Primary Types of Consulting Services

Empire Economics performs research to provide issuers with information as to whether a CFD/project meets the issuers’ financing policy guidelines and to identify potential risk factors that should be disclosed to prospective bond purchasers.

Empire Economics’ consulting services cover a broad array of issues related to municipal finance; each type of study provides guidance on a critical topic:


Price Point Study
Are the prices being used to set the Special Taxes for the CFD/Project representative of current market conditions, so that the prices for which the homeowners purchase the homes will have a tax burden that conforms to the issuer’s policies, such as a maximum of 1.8% or 2.0%?

If the prices used to set the Special Taxes turn out to be higher than the prices that the homes actually sell for, due to the developer/builder using aggressive prices which is sometimes the case, then the homeowners would have tax burdens in excess of the issuer’s policies.
  

Market Absorption Study
Is the rate of absorption for the forthcoming CFD/Project based upon probable economic and real estate conditions, so that the Appraised value represents the issuer’s policy regarding a Value to Lien, typically a minimum of 3 to 1?

If the rate of absorption used for the Appraisal turns out to be higher than the actual rate of absorption, then the amount of infrastructure funded may be more than the level required to meet the market demand.  Since the developers/builders would then be liable for the Special Taxes on the improved but unsold properties, then there is a higher risk of default on the tax payments.  
 

Monitoring Report for CFDs/ADs Bond Issues Study
How can a public entity provide increased disclosure to municipal bondholders regarding the development progress of the residential and commercial-business projects in its Community Facility Districts/Assessment Districts (CFDs/ADs)?

After the initial CFDs/ADs bond sales, the bonds may be traded on the secondary market and so the amount of information available to buyers/sellers can assist them in making prudent decisions. The Monitoring Report provides market participants with timely information on the actual absorption of the homes and commercial/business buildings as well as their price trends, thereby enhancing the marketability of such bonds.