Bond, Types

Question 1

GOB, payable from?

Answer 1

AV

Question 2

GOB, referendum?

Answer 2

Yes if over 1 yr

Question 3

GOB, permissible uses?

Answer 3

Capital Projects ONLY.

Question 4

GOB, what use wd fail?

Answer 4

Operating expense.

Question 5

GOB, when is no vote needed?

Answer 5

No 2nd vote if just refi results in lower int rate

Question 6

What decides if you need a vote?

Answer 6

Time, if over a year.

Question 7

What is source of payment for revenue bond?

Answer 7

Revenue.

Question 8

6 Types of revenue bonds.

Answer 8

Typical COPS LAC TIF (LeaseAssessConduit)

Question 9

Typical Rev Bond, Source of Payment

Answer 9

Typically you get paid using a GUN.

1. Gas taxes, State revenue sharing.
   a) Guaranteed Entitlement Revenues and
   b) Local Government Half-Cent Sales Tax.
2. Utility Rev.
3. Non-AV taxes, ex. excise taxes

Question 10

Typical Rev Bond, Secured by What?

Answer 10

Covenant to budget and appropriate non-ad valorem revenues.

Question 11

Typical Rev Bond, What is Payment Subject to?

Answer 11

LG’s ability to pay its essential services.

Question 12

COPS Rev Bond, Source of Payment

Answer 12

ANY revenue of LG, including AV
UNLESS if lease exceeds 5 yrs, can’t use AV.
Why? b/c its subject to appropriation.

Question 13

What is timing of COPS Rev Bond?

Answer 13

Coincide w/ fiscal yr for appropriation.

Question 14

What kind of issuance for COPS Rev Bond?

Answer 14

Public issuance.

Question 15

What are you selling in COPS Rev Bond?

Answer 15

Undivided interest in lease.

Question 16

Which revenue bond has no revenue pledged?

Answer 16

Equipment lease paymts subjt to appropriation.

Question 17

What cannot be a remedy under Equip. Lease?

Answer 17

Foreclosure.

Question 18

Who do you use a Conduit bond with?

Answer 18

Health, Housing, Industrial Dev. Auths.
Issue on behalf of borrower.
-----------
con=non av + no 2004
con-duit = can't do it

No AV + No 2004 (2003 only)

Question 19

There’s no referendum for CRA/TIF. Constitutional?

Answer 19

Yes, per the Strand case,
CRA/TIF = revenue bond.

How remember? TIFfany’s sells Strands.

Question 20

Special Assessment

Answer 20

Revenue bond available to LGs payable from specific properties receiving the special benefit.
Apportioned by value received.

Question 21

Can CRAs address slum or blight?

Answer 21

Yes.

Question 22

What’s the difference b/w slum and blight

Answer 22

Slum. Poverty/crime/overcrowding.

Blight. Neglected/abandoned.

Question 23

What’s a unique post-issuance exemption to Conduit bonds?

Answer 23

No need to file 2004 (fees paid).

Still have to file 2003 (gen info)

Question 24

GOBs maturing more than 1 year from the date of issuance can be issued only for capital projects or refunding purposes.

Answer 24

TRUE

Question 25

Once a LG irrevocably pledges revenues to the payment of its bonds, this pledge can be revoked if:
(a) the bonds are no longer outstanding
(b) the LG replaces revenues with equally credit-worthy payment source
(c) the revenues pledged were state revenues and the state reserved the right to revoke the funding source
(d) (a) and (c)

Answer 25

D

not A. look for state reservation

Question 26

LGs with taxing power may not grant a security interest in public property unless:
(a) the security interest is a purchase money security interest and the creation thereof is approved by ordinance after a public hearing
(b) the creation of such security interest is approved at referendum
(c) a super majority of the governing body of the local government approves after a public hearing
(d) none of the above

Answer 26

B

i always want to say d.
But, a security interest in public property CAN be granted IF APPROVED @ referendum.

Question 27

TRUE OR FALSE
———–.
If a LG defaults on the payment of traditional revenue bonds, a bondholder can compel the LG to levy additional ad valorem taxes if necessary to pay the principal and interest on the revenue bonds.

Answer 27

FALSE

Question 28

Cities, counties and other LG entities in FL are prohibited from issuing bonds unless the interest is exempt from federal income taxation.

Answer 28

FALSE

Question 29

What are the 5 types of revenue bonds?

Answer 29

Typical COPS LAC TIF

1) Typical
2) COPs
3) Lease
4) spec Assessment
5) Conduit
4) TIF/CRA

Question 30

Local governments may, without voter approval, purchase vehicles under an installment sale contract under which the seller retains a purchase money security interest in the vehicle.

Answer 30

FALSE

Question 31

Which type of bonds require a trustee?

Answer 31

COPS.
LG enters lease w/ non-profit. Trustee sell interest in lease agreement to outside investors. Their certificate allows them to ‘participate.’

Question 32

Which type of bonds cannot exceed 30 years?

Answer 32

COPS.

1) Cannot exceed 30 years.
2) If exceed 5 years, can’t pay from A-V.

Question 33

Distinguish COPS and Conduit revenue bonds.

Answer 33

Cops sentence you 5- 30 yrs.
CONduit says no con du it.
———–
COPS - pay w/ AV up to 5 yrs, don’t exceed 30 yrs.
Conduit - NEVER use AV AND no 2004! (2003 only)