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<br /> Indian River County, Florida
<br /> Notes To Financial Statements
<br /> Year Ended September 30, 2012
<br /> NOTE 13 -LONG-TERM LIABILITIES - Continued
<br /> B. Primary Government- Continued
<br /> Water and Sewer Revenue Refunding Bonds, Series 2005 - Continued i
<br /> The aggregate difference in debt service between the Series 1996 ($40,585,193) and Series 2005
<br /> ($39,619,193) is $966,000. The net economic gain, which included shortening the term of the bonds by
<br /> four years and lowering average annual debt service by $242,000, was $2,944,661 and is amortized
<br /> over the life of the bonds. The unamortized balance of the deferred amount on the refunding at
<br /> September 30, 2012 is $1,684,686 and is reflected as a deferred outflow of resources on the Statement
<br /> of Net Position.
<br /> Pledge of Revenues - The revenue bonds are collateralized, for the remaining term of the bonds, by a 1
<br /> pledge of all net revenues derived from the operation of the system, certain surcharges, and special
<br /> assessments.
<br /> Annual principal and interest payments of$2,405,250 represent approximately eighteen percent of net
<br /> revenues of$13,217,926 of the utility system. The total principal and interest remaining to be paid on
<br /> the bonds is $24,047,900.
<br /> Rate Covenant—Net revenues shall be sufficient to pay 100% of the reserve account requirement and I
<br /> 120% of the current year's principal and interest payment.
<br /> Bonds Issued-At September 30, 2012,the revenue bonds consisted of the following:
<br /> Interest Outstanding at
<br /> Rates and September 30,
<br /> Description Date Maturity Issue 2012
<br /> Water and Sewer 3-5%
<br /> Revenue Refunding Bonds, 3/1 and 9/1 2022 $ 27,675,000 19,010,000
<br /> Series 2005
<br /> Outstanding In-Substance Defeased Debt - The proceeds from the refunding have been invested in
<br /> federal securities and were placed in an escrow account with J.P. Morgan. All of the defeased bonds
<br /> ($31,680,000)were called on September 1, 2006 at 102% of the outstanding principal amount.
<br /> Optional Redemption - The Series 2005 bonds maturing p J after September 1 2015 are subject to
<br /> redemption by the County on or after September 1, 2015, in whole or in part, at par, plus accrued
<br /> interest to date of redemption.
<br /> Water and Sewer Revenue Refunding Bonds, Series 2009
<br /> Purpose - The Series 2009 bonds were issued to refund and redeem on September 11, 2009,
<br /> $28,270,000 of the County's outstanding Water and Sewer Revenue Bonds, Series 1993A. The
<br /> refunding excluded debt service payments due September 1,2010 and 2011,which were consequently
<br /> paid at their respective maturity date.
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