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Show Sell Of Flood Bonds Goes Private By MARK FOTHERINGHAM ; FARMINGTON -- If you fiad planned to invest a spare $12 million in Davis County Flood Control bonds and put Jour money to work repairing damages from last spring's flooding, you may as well just put your money back in the bank. S ACCORDING TO Larry Denham of Prudential-Bache Securities Inc., the county's bond consultants, the county tjas opted not to put the bonds out for public bids. Instead, they have decided to pursue a "privately negotiated" bond sale. That means that the county v. ,tl approach a firm representing represent-ing several banks or other investors, in-vestors, hammering out the terms privately. The interest rates are fairly set in such a situation according to the rating rat-ing of the bond. WHEN PUBLIC bids are taken, there is a possibility that a slightly more favorable interest in-terest rate can be obtained for the pay-back of the bonds. The public sale, however, is more time consuming. Mr. Denham indicated that the county opted for the privately pri-vately negotiated sale in order to sell the bonds more quickly. That will allow crews to begin construction on flood control projects sooner, to prepare for next spring's runoff season. COUNTY Commissioners are accompanying Mr. Denham De-nham to New York this week in order to secure a bond rating from both Moody's and Standard Stan-dard and Poor's rating ser vices, he rating given to the bond and the maturity schedule, sche-dule, (payback period) are the most important factors influencing in-fluencing the final interest rate of the bond. Mr. Denham said that the county is expecting about a 13 year payback period and are hoping to come back from New York with a "AA" rating for the $12 million bond issue. He explained that a Double A rating is the second best rating possible in the bond market and that it would likely trans- late into about a nine percent interest rate. THE COUNTY plans to increase in-crease the flood control mill levy from the presently assessed asses-sed three mills to a total of four mills in order to meet the twice annual bond debt payments as well as paying for routine maintenance to county-wide flood control systems. The first priority for the bond money is to address the needs for new or repaired debris de-bris basins along the county's major water channels. |