Page 362 - City of Bedford FY20 Approved Budget

acquisition of Personal Property. Multiple acquisitions may be grouped in
a single issue, and the debt is financed over the useful life of the assets.

5. Tax Anticipation Note (TAN). Tax Notes are short-term debt
instruments used to finance capital equipment or immediate projects that
have a useful life span of a small number of years, or less. They are a
direct obligation of the City and are backed by the ad valorem taxes levied
on all taxable property. Tax Notes can also be used for the construction of
a public project, the purchase of materials and professional services in
connection with a public project.

6. Method of Sale. The City may use a competitive bidding process in the
sale of bonds unless the nature of the issue warrants a negotiated bid. In
situations where a competitive biding process is not elected, the City may
publicly present the reasons why and the City may participate with the
financial advisor in the selection of the underwriter or direct purchaser.

a. Bidding Parameters. The notice of sale may be carefully
constructed so as to ensure the best possible bid for the city, in
light of the existing market conditions and other prevailing factors.
Parameters to be examined include:

 Limits between lowest and highest coupons
 Coupon requirements relative to the yield curve
 Method of underwriter compensation, discount or premium
coupons
 Use of bond insurance
 Deep discount bonds
 Variable rate bonds
 Call provisions

C. Analysis of Financial Alternatives. Staff may explore alternatives to the
issuance of debt for capital acquisitions and construction projects. These
alternatives may include, but are not limited to:

1. Grants in aid
2. Use of reserves
3. Use of current revenues
4. Contributions from developers and others
5. Leases

D. Disclosure. Full disclosure of operations may be made to the bond rating
agencies and other users of financial information. The City staff, with the
assistance of financial advisors and bond counsel, will prepare the necessary
materials for presentation to the rating agencies. They will aid in the production

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