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3) An internal feasibility analysis will be prepared for each long-term financing <br />that analyzes the impact on current and future budgets for debt service and <br />operations. This analysis will also address the reliability of revenues to <br />support debt service. <br />4) The adoption of resolutions of intent will be considered whenever bond <br />issuance is contemplated to increase the flexibility related to funding costs <br />related to the project (e.g., project development costs, architectural costs, <br />studies, etc.) <br />5) Costs incurred by the City, such as bond counsel and financial advisor fees, <br />printing, underwriters' discount, and project design and construction costs, <br />will be charged to the bond issue to the extent allowable by law. <br />6) The City will conduct financings on either a competitive or negotiated basis, <br />depending on market volatility or the use of an unusual or complex financing <br />or security structure. <br />7) The City will seek an investment grade rating (Baa/BBB or greater) on any <br />direct debt and will seek credit enhancements such as letters of credit or <br />insurance when necessary for marketing purposes, availability, and cost <br />effectiveness. <br />8) The City will monitor all forms of debt annually coincident with the Budget <br />preparation and review process and report concerns and remedies, if needed, <br />to the Council. <br />9) The City will follow all state and federal regulations and requirements <br />regarding bond provisions, issuance, taxation and disclosure. <br />10) The City will diligently monitor its compliance with bond covenants and <br />ensure its adherence to federal arbitrage regulations. <br />11) The City will maintain good, ongoing communications with bond rating <br />agencies about its financial condition. The City will follow a policy of full <br />disclosure on every financial report and bond prospectus (Official Statement) <br />pursuant to SEC Rule 15(c) 2-12. <br />12) Pooled financings with other government agencies will be considered, where <br />appropriate. <br />13) Refundings of existing debt will be considered to reduce interest costs or <br />principal outstanding, or to eliminate restrictive debt covenants. <br />14) Borrowing from revolving loan funds (i.e. State of California, Dept. of <br />Boating and Waterways) will be evaluated and considered on the same basis <br />as any other debt. <br />224 6 <br />