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<br />The interest rate of the issue is almost always the most important consideration. Since this <br />Consortium is in the initial stages of development and no bonds have been issued, it is <br />impossible to know whether the rates will be higher or lower than if the City issued bonds. <br />Mr. Rickter indicated that the bond ratings of the participating agencies will factor into the <br />interest rate of each individual bond issue. Also, I am concerned about the possibility of <br />issuing variable rate bonds which is what Mr. Rickter indicated the Consortium planned to <br />do. He further stated that each entity would be given an opportunity to convert the variable <br />rate bond to a fixed payment schedule after the sale. However, even with this option to <br />convert to a fIxed payment, the risks of variable rate bonds, especially on long term bonds, <br />need to be carefully considered. <br /> <br />Action Requested <br />The Council is asked to consider ERMU's request. No action is required at this meeting. If <br />the Council does want to join the Consortium, approval by resolution will be required. <br />