Paying Agents and New Payment Deadlines
by Connie Kuck and Debbie Peterson
agents are a third party that is engaged on a contractual basis to
make sure debt payments are made in a timely manner.
to maintain a record of the debt obligations, the paying agent is
contracted to administer to notify the local government in advance of
payment due dates, to collect the amounts due, and to make the
payment on time to the proper party.
agent also handles other administrative actions, such as processing
of mandatory redemption notices for term bonds.
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Financial Power Tools for Tough Economic Times
by Brad Townsend
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550 Warrenville Road
Lisle, IL 60532-4311
Welcome to the spring edition of The Advisor.
issue we explore Tax Anticipation Warrants as an alternative for
cash flows, look at the current interest rates for Illinois, and
examine the debt service extension base.
Then we spring forward to referendum planning for 2012 and more.
Considering Tax Anticipation Warrants for Cash Flow
Tax Anticipation Warrants (TAWs) are used to fund
deficiencies in the cash flow of a local government.
available to all units of local government in Illinois. TAWs allow
a unit of government to borrow money for the short-term from a
local bank or broker/dealer to be repaid with interest from the
following year's property tax receipts.
maturity of the Warrants can range from one month to 13 months, and
the debt is included in the calculation of a taxing entity's debt
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Interest Rates for Illinois
Currently, residents of Illinois are paying more in
interest rates than their counterparts in other states.
rates have been 0.5% to 1.0% more in Illinois than in Wisconsin.
rates are attributed to the State of Illinois' budget issues and
Service Extension Base
Local governments, which are subject to the Tax
Extension Limitation Law, are allowed to issue limited bonds.
limited bonds are payable from a local government's debt service
is usually established the levy year before the taxing body became
subject to the Tax Cap.
Planning for 2012
With the April 5,
2011 consolidated election around the corner, many local
governments are looking to the next election cycles for bond
referenda and other public questions.
initiate a public question, a governing board needs to take action
by the specific dates for the March 20, 2012 General Primary
Election and the November 6, 2012 General Election, respectively.
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