agency, will bring tlie lowest interest rate of any bond-sale method of financing. However, a 

 two-thirds vote of the electorate is usually required to authorize bond sales, and the 

 allowable bonded indebtedness is Umited to a percentage of the total tax base of the agency 

 as established by its organizing charter. 



A simple majority vote of the electorate will authorize a revenue-bond sale, which does 

 not obUgate the taxpayer and is guaranteed only to the extent of the revenues that the 

 project will bring. Because of the greater risk, these bonds are normally bid at a rate 

 considerably higher than the general obUgation bond rate for a similar project. The actual 

 amount of this rate will be determined to a large extent by the findings reported in the 

 feasibility study. Because of this, it is not unusual for the local agency to have the 

 preliminary feasibiUty study upgraded to the status of a prospectus for revenue-bond sales 

 by the addition of such further marketing analysis and cost studies as may be considered 

 necessary to give the prospective bond buyer a better insight into the project's economic 

 potential. 



k. Cash-Flow Analysis. An important device for evaluating economic potential is the 

 cash-flow table that sums up the estimated expenditures and receipts for each year of the 

 project from inception to full amortization of indebtedness. The table must take into 

 account the probable debt-servicing charges, advertising and insurance costs, and all 

 operational and maintenance expenses (including the costs of replacing any short-life 

 components) as compared to the estimated annual income from berth rentals, launching 

 fees, and ancillary-facility leaseholds. If phased construction is anticipated, the dates on 

 which additional capital input will be needed must be shown, together with the resultant 

 increases in debt-servicing charges during the ensuing years. If a financing institution 

 disagrees with the debt-servicing estimates, but accepts the other elements of a cash-flow 

 analysis, it can simply substitute a figure for debt servicing and reach an independent 

 conclusion as to the economic potential of the project. To gain a better understanding of 

 the many problems to be faced in managing a small -craft facility, and to make a more 

 realistic appraisal of the economic factors involved, the prospective developer should 

 carefuUy review the following principles, and the case histories of actual marina projects 

 described in Section VIII. 

 2. Project Implementation. 



a. Timing of Design and Construction. If it appears certain during the feasibility study 

 that the project will be implemented, or as soon as funding is guaranteed, preparation of 

 final plans and specifications for the facihty should begin. Any site investigation work left 

 for this stage of project planning must be completed to provide the necessary design criteria. 

 If the findings reveal a need to modify any features of design assumed in the feasibility 

 study, such as tlie protective structures or the dimensions of channels or basins, these facts 

 must be evaluated at once to determine their effects on economic feasibility. Detailed 

 planning can then be pursued, but the order in which the various components are designed 

 and constructed may be important in several respects. 



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