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would be able to re -issue any of this obligation in tax - exempt form. Upon further questioning of <br />Bond Counsel, it now appears possible that we could issue a portion of the debt as tax exempt. <br />This would not be purchased by us, thereby freeing up our money for higher yielding instruments <br />while at the same time reducing the cash flow needs from the district. The key components to <br />accomplish this are as follows: <br />1. No land sale proceeds from townhome portion of project. (This means we will sell <br />the commercial side for an offsetting amount.) <br />2. No assessment agreements at the time of debt issuance. (We will have an assessment <br />agreement on each townhome unit that will go away as each unit is sold to a private <br />party.) <br />3. No TIF guarantee at the time of bond sale. (We will have a TIF guarantee that will <br />go away as each unit is sold to a private party.) As a result of this opportunity, we <br />will not re -issue debt until such time as the townhome component is entirely <br />completed; likely in 2005/2006. <br />We will also creating an $880,000 interfund loan that will ultimately be part of the refinancing. <br />We will adopt the necessary resolutions at the time we execute the development agreements. The <br />proceeds of this loan are being used to fund the Rutzick acquisition and are accounted for in the <br />overall district cash flow calculations. <br />Please let me know if you have any comments or questions regarding the status of this project. <br />2 <br />