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J~4Y OF h4 <br /> <br /> Harry Kim ~ William Takaba <br /> Mayor Director <br /> ;a <br /> Nancy E. Crawford <br /> G::;:N <br /> er•:; k e;•~+` Deputy Director <br /> ,rE oF•~P.e~ <br /> COllil~~ O~ ~~W~11 <br /> Finance I)epart>rnent <br /> 25 Aupuni Street, Room 118 • Hilo, Hawaii 96720 <br /> (808)961-8234 • Fax (808)961-8248 <br /> ®t~ <br /> r~ F . <br /> ~ - <br /> April 2, 2004 - <br /> - <br /> tm <br /> 1"®: The hionorable Aaron Chung, Chairman, <br /> Hawaii County Council Finance Committee <br /> FfZ®99A: Nancy Crawford <br /> Deputy Director of Finance <br /> FZ~: 2003A Bond Proceeds <br /> Per your request, I am providing an explanation of the additional proceeds from the sale <br /> of the 2003A bond series. At the time of the bond ordinance the Council identified <br /> projects totaling $35,312,650 and an allowance for bond issuance costs of $1,000,000. <br /> Over the several months that the bond ordinance was considered interest rates and <br /> demand for municipal bonds fluctuated significantly. Through a combination of diligent <br /> work on the part of our brokers and a favorable bond market on the day of sale there <br /> was a high demand for our bonds. The result was- that we were able to sell them at a <br /> premium. The par value of the bonds was $36,310,000 and the premium paid for our <br /> bonds was $1,405,177. <br /> Interest rates on the bonds range from 2.0% to 4.7%, and were not a factor in the <br /> premium we received. The premium was driven by demand. The low rates help us <br /> keep down debt service costs, and made selling bonds at that time attractive. <br /> Additionally, the issuance costs for the bonds were only $453,273. This was, in part, <br /> because we were able to receive a very good bond insurance rate. The combination of <br /> premium on bonds and below budget issuance costs provides approximately $1.9M <br /> additional to spend on projects identified in the bond ordinance. <br /> If you have any additional questions, please feel free to contact Deanna Sako at x8425. <br /> R~~. ~r~ss~ <br /> <br />