ABSTRACT
In the fall 1985 issue of Municipal Finance Journal, Professor Harold Bierman, Jr., analyzed and rejected the three commonly used methods for the valuation of competitively bid bond issues, putting forth instead a fourth technique of his own, the innovative none of the above (NOTA), or Bierman technique. In October 1991, Pinellas County successfully applied the Bierman technique to an actual bond issue, despite Daniel Anderson and the resistance of various underwriters, financial advisors, and bond counsels. The Bierman article defined four evaluational techniques, net interest cost (NIC), Canadian interest cost (CIC), present value, and NOTA. Florida municipal issuers generally award competitively bid bonds according to the true interest cost (TIC) method. TIC is defined as a discounted cash flow analysis, which is used by selecting a discount rate and applying it to a known future series of payments to calculate their present value.
