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,FRE: 2004 P&OS Bonds - Arbitrage Calculation Page 2 of 2 <br />r <br />7.T <br />To: CARLSON Jim R; COREY Kurt A; CARLSON Becky A; RISDAL Lacey L; MEDLIN Johnny R; WEISS Carolyn 3; JONES Angel L; GRUBE Renee L; <br />- - HARDT DeeAnn; MURDOCH Kitty M; CRONIN Finn J; LAUDERBACH Douglas K <br />Subject: 2004 P&OS Bonds - Arbitrage Calculation <br />Our arbitrage consultant has just completed a preliminary calculation for the 2004 Parks & Open Space Bonds <br />through 6/30/06. The bonds earned $275,000 of interest since they were issued. Because interest rates were so <br />low during this period, there is no arbitrage rebate payment due to the IRS (the IRS would have allowed us to <br />earn up to 4.0% on the bond proceeds, but we only earned 2.7%). Because we do not owe the IRS any of this <br />interest, all of the earnings may be used for bond projects. <br />In order to spend this money, we'll need to do a supplemental budget. We can do that on SB#1 in December. <br />The PROS policy group is meeting on September 6. That would be a good opportunity to discuss what projects <br />might be appropriate for this additional available funding. As a reminder, interest earnings can only be spent on <br />the things that the bond funds are authorized to be spent on: <br />costs related to the purchase of land for parks and open space, the construction of parks and athletic <br />fields on public land, and the replacement of Amazon Pool. Projects will include the construction of <br />neighborhood and community parks; construction of youth sports parks; replacement of Amazon Pool; <br />upgrading existing athletic fields and parks on public land; acquisition of land for neighborhood and <br />community parks; acquisition of open space; and payment of bond issuance costs." <br />Let me know if you have any questions. <br />Sue (x5589) <br />11/3/2006 <br />