A proper reserve fund
should be estimated using lifecycle costing analysis, which is a modelling technique that sets out the cost of the building's assets and the estimated cycle of replacement in years.
The second part of the calculation is more complicated, which makes it possible for a sponsor to use artificially lowered offering prices to reduce its reserve fund
obligations, without the condominium board or unit owners ever realizing that a deception is taking place.
FedNor's $3-million reserve fund
will act as a safety net in the event an approved, high-risk business loan cannot be repaid, Desmarais-Santi says.
The Valley city's planned reserve fund
in the LAFCO study was $6.
Also, he said, the city's economy continues to improve and will be getting extra revenue this year that will go into the reserve fund
The authority plans to solve this problem by replacing a portion of the debt service reserve fund
requirement with a letter of credit (LOC) and using the released funds for the January 2007 payment.
5 million in the bond's reserve funds
that could be distributed to the 500 bondholders.
The rating also reflects the sufficient level of Authority contribution to cover costs of issuance and the initial deposits to the following accounts: an Escrow Reserve Account to cover a portion of principal and interest payments on certain classes of certificates; a Principal and Interest (P&I) Reserve Fund
as a reserve for payment of principal and interest on all classes of certificates; a FNMA Reserve Fund
for payment of principal and interest on those certificates collateralized by FNMA certificates; and a Subsidy Escrow Account with advance funding of three months of mortgage interest rate subsidies.
Additional support for the bonds is available from an interest reserve fund
initially equal to three months interest on the original principal amount of the bonds until such amount is equal to six months interest on the outstanding bonds, and thereafter remains equal to six months interest payable on the bonds.
15, 2006, total reserve fund
balances equaled a solid 18% and 16% of consolidated bonds and notes, and total obligations (excluding special project bonds), respectively.
The Series 2006 Bonds are being issued to acquire Federal Family Education Loan Program (FFELP) student loans, and First Rate Solutions Alternative student loans, fund the reserve fund
, and pay cost of issuance.
Balances in the general reserve fund
at the end of the year will be rebated back to the participants.
The reserve fund
requirement for the 2006 series bonds is 1.
Fitch also affirms the 'AA' rating on approximately $1 billion of the authority's outstanding reserve fund
The series 2006A bond issuance proceeds will be used to fund the capital reserve fund
, deposit $84.