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CITY OF SOUTH BEND, INDIANA
<br />NOTES TO GENERAL-PURPGSE FINANCIAL STATEMENTS
<br />Continued}
<br />The present value of the lease, $1,9fi0,044, is the new basis for the parking garage. As part of this
<br />salelleaseback, the Parking Garage Fund recognized a deferred loss of $8,439,112, which will be
<br />amortized over the fifteen year life of the lease.
<br />Note 22. Bond Refunding
<br />Enter rise Funds -Wastewater Utili
<br />On October 25, 2001, the Wastewater Utility issued $5,240,000 in refunding revenue bonds with an
<br />average interest rate of 3.83°/° to advance refund $5,950,000 of outstanding 1993 Sewage Works
<br />Refunding Bonds with an average interest ra#e of 5.13°1°. The net proceeds of $5,345,fi91 rafter
<br />payment of $95,525 in bond issue casts and $12fi,fi1 fi in bond premium} and local contributions of
<br />$7'47,445 were used to purchase U.S. Government Securities. Those securities were deposited in
<br />an irrevocable trust with an escrow agent to provide far all future debt service payments on the
<br />1993 bonds. As a result, these bonds are considered to be defeased and the liability for those
<br />bonds has been removed from the Balance Sheet. The advance refunding resulted in an account-
<br />ing loss of $175,393, which has been recognized on the Balance Sheet as Deferral of Loss on
<br />Refunding. This amount will be amortized using the straight line method and charged #o interest
<br />expense over the next seven years. The refunding in effect reduces the Wastewater's aggregate
<br />debt service payment by $312,211 over the next seven years and realized an economic gain ~differ-
<br />ence between the present values of the old and new debt service payments} of $290,393.
<br />Governmental Funds
<br />On August 30, 2001, the South Bend Redevelopment Authority issued $6,825,000 in refunding
<br />revenue bonds with an average interest rate of 4.58% to advance refund $fi,050,000 of au#standing
<br />1994 Redevelopment Authority Bonds with an average interest rate of fi.21 %. The net proceeds of
<br />$fi,123,340 rafter payment of $111,251 in bond issue costs and $56,414 in bond discount} and local
<br />contributions of $348,459 were used to purchase U.S. Government Securities. Those securities
<br />were deposited in an irrevocable trust with an escrow agent to provide for all future debt service
<br />payments on the 1994 bonds. As a result, these bonds are considered to be defeased and the
<br />liability for those bonds has been removed from the General Long-Term Account Group. The
<br />refunding reduces the Redevelopment's aggregate debt service payment by $280,943 over the next
<br />seventeen years and realized an economic loss difference between the present values of the old
<br />and new debt service payments} of $392,784.
<br />Nate 23. Transfer of Football Hall of Fame Operations
<br />During 2001, the City turned over the operations of the Hall of Fame to the National Football
<br />Foundation and College Hall of Fame, lnc., NFF}. The interim agreement authorizing the NFF to
<br />operate the Hali of Fame is in effect until December 31, 2005. As part of the operations change, the
<br />City paid the NFF $fi92,994. The City also transferred fixed assets to the General Fixed Asset
<br />Account group, long-term debt to the General Long-Term Debt Account Group, assets related to
<br />debt retirement to a debt service fund, and the advance from other funds to a special revenue fund.
<br />Prior to turning over the operations of the College Football Hall of Fame to the NFF, the City
<br />reported the College Football Hall of Fame was an enterprise fund.
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