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e;i <br />iptiT NATIONpL-9001INE CON OUP6E 50l MqROLETiE iVF. MiNNEACOUS, MINNp9DTG 554U2 <br />r <br />July 7, 1980 <br />Mr. Bruce i dersan, Acting City Manager <br />Mounds View ity Hali <br />2401 Highway 10 <br />St. Paul, MN 55112 <br />Re: financing Park and Recreational Faciiities <br />Qn Ji. <br />j Lt, 0`,`E\ <br />Q- p'oS <br />Dear Mr. Anderson: <br />Attached are computer exhibits that reflect "r.he tax impact of bond issues <br />for homeowners in the City. Bond issue'am+snts ra y,',ng from ;500,OD0 to <br />E2,500,000 were used. These are represented'by exh9tiits 1.00 through 5.00 <br />respectively. <br />The exhibTts 1.10, 2.10, 3.30. 4.10, and 5.10 reflect the estimated tax <br />increase for the respective bond issues for homenwners with market values <br />ranging from 530,000 to $100,000 having income fewm ;7,500 to 537,500 <br />and based on the average mi11 rate thraUgh 1997. <br />The exhibits 1.20, 2.20, 3.20, 4.20 anA 5.20 provided the tax impact for <br />senior citizens and the disabled. <br />The mill rate used of 99.00 is based on tax s Daiu tifs year (1980) and <br />the estimated increase as indicated on each ezhibit. <br />As of th4s writing the,Dow Jones Index is 7.88 for 20-year bonds. We <br />used an estimated 8 percent rate in the caluclations to determine interest <br />costs. The valuation was shown to increase 3 million per year or about <br />7.5 percent of the current vaiue of $39,484,000. <br />The bond market has been volati7e but bonds are being marketed. We are <br />finding that bonds meiuM ng after 15 years are difficu7t to sell and in ffet <br />some u derwriters have lndiwted they might not bfd on longer bonds, even <br />with the higher interesL 17mits of 12 percent aliowed. <br />The bond market wt11 lil:ely remaSn unstable as long as WasMagtod keeps <br />changing the rules--and the budget deficit looms larger. <br />I`I1 be looking forward to our July 10 meeting. <br />STncerely. <br />EHLERS AND ASSOCIATES, 1NC. <br />yAi ; : <br />c.—_ _. _ _ <br />L.,L`it,/ [ZLca%lG` <br />Vh1111p E. Chenoweth <br />PEC:1t9