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' Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30 , 2003 ' An increase in construction in progress was due to current fiscal year disbursements for the new public works complex ($3 . 3 million), Dodgertown renovations ($4 . 1 million), beach renorishment ($9. 5 million) and road improvement projects . Business-type Activities capital assets activity during the fiscal year: The increase in land is due to the acquisition of 38 acres for a water distribution/collection complex . ' Buildings and improvements increased due to the completion of Phase 3B of the water distribution system in Sebastian. Construction in progress increased due to starting additional water and sewer projects during the fiscal ' year. Additional information on the County's capital assets activity is provided in the notes to the financial statements . ' DEBT MANAGEMENT Governmental Activities Debt ' The County took advantage of the decline in interest rates to reduce its future debt payments . On July 1 , 2003 , the County issued $7, 800,000 of General Obligation Refunding Bonds, Series 2003 . The proceeds of the Bond issue, together with $600 ,000 of County funds, were used to pay off the $ 8 , 320, 000 remaining balance of the General Obligation Bonds, Series 1995 . Future payments for principal and interest have been reduced by $ 1 .4 million and the County realized a net present value savings of $730,000 . Total outstanding principal on the Series 2003 bonds ' and the Series 2001 Bonds as of September 30 , 2003 is $ 17 . 725 million, a $2 . 085 million reduction from the General Obligation Bonds outstanding principal amount as of September 30, 2002 . The General Obligation Bonds were authorized by voters to acquire environmentally sensitive lands and are backed by ad valorem taxes . In ' August 2001 the County issued $ 16 , 810,000 of revenue backed bonds to acquire the Dodger 's spring training facilities and make improvements to those facilities . Principal payments of $460,000 were made during the year and as of September 30 , $ 15 ,990,000 is still outstanding . Since all County bond issues are insured by AAA rated insurance agencies , the bonds are rated AAA, which is the highest rating given by the rating agencies . Business-type Activities Debt ' The County issued bonds in 1993 to legally defease the 1985 and 1991 Recreational Revenue Bonds, which were issued to provide funding for the County golf course , Sandridge . Principal payments of $375 , 000 were made during the year and as of September 30, $6,735 ,000 is still outstanding. In 1993 and in 1996, the County issued bonds to refund outstanding water and sewer bonds and to provide funds for expansion of the water and sewer systems . Principal payments of $ 1 , 765 , 000 were made during the year and as of September 30, $ 72,760,000 is ' still outstanding. All three bond issues are insured byAAArated insurance agencies and, therefore, are ratedAAA. Additional information on the County 's debt management activity is provided in the notes to the financial state- ments. FUTURE FINANCIAL CONDITION ' Governmental Activities For the 2003 /2004 fiscal year, an increase in taxable values of 12 . 7% has provided the ability to pay for a 16% increase in health insurance costs and a 15 % increase in State mandated pension plan contributions without an 9