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Comparison of Borrowing Methods Is on-going What part of funding Is' there sufficient the community Are voters likely Is' it important to achieve Borrowing available to room under debt will use/who to approve a hal- the lowest possible bor- Other Factors limits' to include should pay for lot measure for rowing cost and interest Type make annual project borrowing? the project? rates? payments'? the project? GO Bonds No Subject to statutory Whole Voter approval First choice - lowest cost This borrowing method comes limits community required, with with a funding source to make benefits double majority the annual payments provisions Limited Tax Yes Subject to policy Whole Voter approval Second choice Statutes limit the purposes avail- Bonds limits if not self- community or not needed able to borrow under this pro- supporting subset gram COPs or Yes Subject to policy Whole Voter approval Third choice - FF&C lease- Lease- limits if not self- community or not needed purchase Purchase supporting subset COPS - can be very expensive Revenue Yes Subject to policy User pays Subject to citizen Can range from relatively May be used for projects Bonds limits if not self- referral of inexpensive to very expen- including but not limited to real supporting ordinance sive, depending on the property construction or project and revenue source acquisition Assessment Yes Subject to statutory Benefited Creation of More expensive; financing Can only be used for assessment Bonds limits party pays assessment depends on nature of projects district subject to property assessed remonstrance Tax Yes Not Applicable (no Whole Voter approval More expensive Can only be used for projects Increment statutory or policy community or not needed included in the UR plan Bonds limit) subset Section 108 Yes Not Applicable Whole Voter approval More expensive Project must be eligible for Loans community or not needed CDBG funding. subset Conduit Yes Subject to policy Whole Voter approval Very expensive due to com- May be used if there is no statu- Financing limits if not self- community or not needed plicated relationships and tory authority to issue COPs; are supporting subset additional parties there reasons to give up control over the project? Lease Pur- Yes Subject to policy Whole Voter approval More expensive than GO May be used if there is no chase with limits if not self- community or not needed bonds, even with conduit statutory authority to issue COPs Private Sector supporting subset financing Participation L:\CMO\2004 Council Agendas\M040428\S040428A. doc