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leEHLERS <br />LEADERS IN PUBLIC FINANCE <br />Other Considerations <br />Legal and federal debt limits. Even though the member cities of the Commission will <br />utilize franchise fee revenues to offset any levy requirement, each city's capital notes will <br />count toward their legal debt limit. <br />Another limitation to consider is the $10 million threshold a city must stay under annually in <br />order to designate its bonds as bank qualified debt. It is the request of the Commission that <br />the City of Circle Pines allocate the full amount of the debt against this amount. Circle Pines <br />will not require each member city to designate their capital notes for purposes of their own <br />$10 million thresholds. <br />Call Feature. For a 10 year Bond issue, the market is typically comfortable with a 7-8 year <br />call feature whereupon the Bonds are able to be prepaid without penalty. It is expected that <br />the financing will carry a call date of February 1, 2024. Each member city's capital notes <br />may be defeased ahead of this call date. <br />Timing. Upon authorization by the member cities, the City of Circle Pines plans to include <br />the equipment financing within its 2016A Bonds set to issue in late March. It is expected the <br />City's financing will close in mid to late April. <br />The debt service estimates for City -issued General Obligation bonds to finance $2 million <br />capital equipment project and associated financing costs are attached. It is expected <br />financing costs may be reduced due to favorable terms at the time of Circle Pines' bond sale. <br />Any such savings will be reflected in a reduced principal amount and carried forward in the <br />fmancing terms of each member city's capital notes. <br />We look forward to further discussions on these issues. <br />1 800-552-1171 1 www.eblers-inc.corn <br />