ABSTRACT
A serial municipal bond issue is typically a long-term commitment by a locality or state with a portion of the debt maturing each year until the final maturity date. This chapter focuses on the serial bond issue structuring process. It discusses why the issuance of cost-effective bonds is so critical in the new municipal bond market. The chapter presents the participants in the process followed by an enumeration of the decision that must be made and discusses each decision in detail and how each affects the cost of issuing debt. It includes three methods of computing interest costs: net interest cost (NIC), true interest costs (TIC), and present value of interest cost (PIC). It also presents three techniques for forecasting revenues: exponential smoothing, time series analysis, and causal models. The underwriter bids for the right to purchase the new issue bonds from the issuer and resale the bonds to the investing public.
