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L. J <br />BItn mi <br />lEADIRS IM PUBLIC FINANCE <br />A <T 1 M ONTHLY PUBLICATION <br />DFfiCES IN VIINNEAPOHS AND WAUKESHA <br />VOLUME 35. NAJMPEiU <br />HLE: Finmcial SpecidLists: EMera ml Asaociaies. Inc. <br />Please dtaumne to governing body members <br />INTEREST RATES <br />Bond indesns <br />January 1966 to Oacoatwr 1989 <br />9.sot V <br />Inlerett rates on tax-exempt bonds <br />have improved with tlie BBl at <br />7.4*}% in early October dropping <br />to 7.00% in early December, an <br />improvemcni of 40 basis pwints <br />Taxable inicrest rates gyrated in <br />the last quarter with the US <br />government bond yields moving <br />from the usual ascending curve <br />(higher rates for longer maturities) <br />to invened. humped and sagging , • <br />Sometimes thirty year yields were lower than those on Treasury bills, with intermediate maturity yields <br />higher than either Because of Fetleral Reserve Board uncertainties all interest rates may be higlter than <br />they should be. given a 4% inflation late. <br />01/86 01/87 01/88 01/89 12/89 <br />DISCLOSURE <br />State and municipal offerings have been brought within the Federal Securities Exchange Commission <br />(SEC) ami its new disclosure Rules 15c 2-12 Tlirough overuse of tax-exempt fmancings, the trade <br />aroused the attention of the US Treasury Department, the courts. Congress and the bureaucracy. Fhe <br />famous WPPSS bond default featured the lack of adequate disclosure. In addition, a court case changed <br />the Constitution as previouslv mterpreted. to take away State s rights to finance their needs, free of <br />fedetal mterference and taxation Effective January 1. IV90 Governmental borrowers are subject to SEC <br />regulation governing disclosure <br />While our clients and most borrowers have ciuefuMy disclosed economic ami financial data for years, <br />issuers now by fedenU rule, must furnish a near final official statement to bidders before receiving bids <br />Seven days aftei awiud. the utiderwriter must distribute a final official statement to investors Issuers <br />must noti'fv successful bidders of significant changes within a certain period after the sale Excepted are <br />securities sold in denominations of $I(M).(M)() or more sold to ,T5 or fewer sophisticated investors, or <br />mature in ^ months or less, iuul issues undei $1,000,000 <br />N'-eilless to sav these regulations increase the complexity and cost of borrowing For thirtv-five years <br />Fillers and /Xssociates have been leaders in assisting borrowers in ihsclosure of infonnation and have <br />earnerl a reputation for presenting bond issues simply imd completely None of our clients have suffered a <br />tlefault ’ Disclosure" is nothing new here <br />J9SI} . 'K; S’'.:”' Si MN SS40? lUC • hi.' vw H.N1 • hU’ .KiLm