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					  Financial Education – Break Out Session
“Impacts of the Current Economic Crisis on
           Maine Municipalities”

            February 27, 2009

 Joseph P. Cuetara, Senior Vice President
The Rating Process




Credit Factors       Potential Rating Change Driver
Economy             Significant development in the local tax base driving continued growth in total property
                     values.
                    Increased or decreased diversification of local tax base.
                    Loss of key industry or employer with no work-out plan.

Finances            Expected augmentation (or loss) of financial flexibility.
                    Expectation that significant growth (or decline) of reserves will continue.

Debt                Significant increase in debt obligations without correlating development to offset tax-
                     base leveraging.
                    Utilization of debt structure not appropriately matched to asset's useful life.

Management          Implementation of new strategies that are expected to augment (or detract) from
                     operating flexibility.
                    Change in political environment that affects ability to react to unanticipated events.

Legal Security      Indenture for non-tax backed debt; Regulatory agency permission; Financial flexibility:
                     Unlimited, Limited or Restrictive.
                                     Tax Collections
                                                  o Budget
                                                  o Actual
                                                  o Variance
                                                  Equalized                                                     Collections
                                        Fiscal       State         Assessed      Tax         Tax      (after Supplements and Abatements)
                                       Yr. End    Valuation       Valuation      Rate       Levy     Year End % of            % of Levy
                                       June 30,      (000)           (000)      (000)       (000)      (000)        Levy     A/O 9/01/07
                                        2008      $1,515,400(1)   $1,543,012    $12.56     $19,380           ----- In Process ----
                                        2007       1,429,300       1,484,038     12.50      18,550   $17,931 96.30%            97.77%
                                        2006       1,337,850       1,032,170     17.90      18,476    17,867 96.45             99.39
                                        2005       1,180,750       1,014,535     18.10      18,363    17,824 96.98             99.91
                                        2004       1,044,100         983,051     18.10      17,793    17,265 96.75             99.95



Excise Tax         REVENUES:
                                                         2004            2005            2006          2007             2008
      o Budget     Property taxes                       8,642,471  8,485,973  7,878,306  8,123,053   9,081,446
      o Actual     Excise taxes                         1,066,000  1,218,000  1,338,000  1,359,000   1,409,431
      o Variance   Intergovernmental                      784,831    864,291    793,020    779,475     788,348
                   Charges for services                   292,275    383,399    414,844    403,165     411,185
                   Interest                                82,000     95,000    122,500    113,000     249,058
                   Misc                                    57,590      5,700      4,850     12,050     146,332
                   TOTAL REVENUES                      10,925,167 11,052,363 10,551,520 10,789,743 12,085,800

                                                        Fund Balance as % Revenues
Fund Balance
      o Budget                                                            Fiscal Year Ended June 30,
      o Actual                                                2003       2004        2005        2006     2007
      o Variance     Unreserved General Fund Balance       $6,211,542 $5,918,858 $7,062,882 $7,455,082 $8,018,685
                     Total Revenues (Current Year)         48,313,362 50,509,302 54,158,598 56,600,224 59,619,730
                     Fund Bal as % Revenues                  12.9%      11.7%       13.0%      13.17%   13.45%

                     Undesignated General Fund Balance     $4,669,251 $4,693,564 $4,366,474 $5,519,830 $6,021,738
                     Total Revenues (Current Year)         48,313,362 50,509,302 54,158,598 56,600,224 59,619,730
                     Fund Bal as % Revenues                   9.7%       9.3%       8.1%      9.75%     10.10%
  Banking & Advisory Group




LD1?
PROPERTY TAX LEVY LIMIT

                            Fiscal year:   2005/2006      2006/2007      2007/2008     2008/2009
          State Personal Income Factor:      2.580%        2.620%         2.470%         2.240%
           City Property Growth Factor:      4.507%        4.707%         4.901%         2.819%
              Growth Limitation Factor:      7.087%        7.327%         7.371%         5.059%
               Property Tax Levy Limit:     $9,473,603   $10,579,685    $11,710,086    $12,301,603
                    Property Tax Levy:     (9,857,447)   (10,906,198)   (11,709,253)   (12,009,957)
 Over/(below) Property Tax Levy Limit:        $383,844      $326,513          ($833)     ($291,646)
DEBT RATIOS

  Fiscal                      Equalized       Assessed                        Debt              Per
 Yr. End                      State Val.     Valuation          Total         as %            Capita
 June 30,      Population        (000)         (000)            Debt         Eq. Val.          Debt
  2008           7,800         $1,515,400(1) $1,543,012      $11,230,850       0.74%        $1,439.85
  2007           7,800          1,429,300     1,484,038       11,952,600       0.84          1,532.38
  2006           7,800          1,337,850     1,032,170       13,495,250       1.01          1,730.16
  2005           7,800          1,180,750     1,014,535       15,107,900       1.28          1,936.91

        DEBT RATIOS

             Fiscal                       Equalized      Assessed        Total           Debt             Per
            Yr. End     Population        State Val.    Valuation        Debt            as %           Capita
            June 30,                        (000)          (000)         (000)          Eq. Val.         Debt
             2007           23,203        $1,922,200    $1,692,456    $73,401,477        3.82%        $3,163.45
             2006           23,203         1,658,250     1,319,998     68,030,309        4.10          2,931.96
             2005           23,203         1,547,750     1,268,207     60,328,678        3.90          2,600.04
             2004           23,203         1,350,550     1,214,674     58,910,300        4.36          2,538.91

                               DEBT SERVICE COMPONENT OF OPERATING EXPENDITURES

                                                                                            Audited                           Budgeted
                                                                     2003       2004         2005         2006      2007        2008
                                     Total Current Year Debt Service: $2,571,720 $2,904,351 $2,635,596 $2,300,485 $2,153,693 $1,917,384
                                                 (less TIF Supported)   (228,150)  (221,585)  (215,540)  (209,365)  (203,060)  (196,625)
                                       (less Subsidized School Debt):   (450,375)  (430,075)  (409,775)  (384,656)  (364,719)  (344,781)
                                            Net Tax-backed Debt: $1,893,195 $2,252,691 $2,010,281 $1,706,464 $1,585,914 $1,375,978
                                    Budgeted Operating Expense: $21,218,691 $21,677,694 $22,534,947 $22,907,052 $23,582,021 $23,907,389
                                 Debt Service as % Oper. Expense:  8.93%      10.40%       8.92%       7.45%       6.73%       5.76%
    Household/Per Capita Effective Buying                      Available Fund Balance
         Income As % Of U.S. Level
          Low                      Below 65%                  Low                        Below 0%
         Adequate                           65%-90%         Adequate                        1%-4%
            Good                          90%-110%            Good                          4%-8%
           Strong                        110%-130%           Strong                        8%-15%
        Very strong                     Above 130%         Very strong                  Above 15%


             Market Value Per Capita                     Debt Service As % Of Expenditures
            Low                      Below $35,000            Low                        Below 8%
         Adequate                  $35,000-$55,000          Moderate                       8%-15%
           Strong                  $55,000-$80,000          Elevated                       15%-20%
        Very strong               $80,000-$100,000            High                      Above 25%
     Extremely strong               Above $100,000
                                                             Overall Net Debt Per Capita
                Top 10 Taxpayers                            Very low                Below $1,000
        Very diverse                     Below 15%            Low                  $1,000-$2,000
          Diverse                         15% - 25%         Moderate               $2,000-$5,000
Moderately concentrated                   25% - 40%           High                  Above $5,000

       Concentrated                      Above 40%
                                                        Overall Net Debt As % Of Market Value
                                                              Low                        Below 3%
                                                            Moderate                        3%-6%
SOURCE: Public Finance Criteria: Key General
Obligation Ratio Credit Ranges - Analysis Vs. Reality   Moderately high                    6%-10%
(Standard & Poor's , April 2, 2008)                           High                      Above 10%
  Medians For Local Governments
  Per capita EBI as % of U.S. level        95%
  Household EBI as % of U.S. level         99%
      Market value per capita           $73,960
 Top 10 taxpayers as % of ass'd val      8.10%
  Total GF balance as % of expend          21%
 Debt service as % of expenditures          7%
     Overall net debt per capita         $1,999
Overall net debt as % of market value    2.62%
            Banking & Advisory Group




                                                                                          GENERAL OBLIGATION BONDS
                                                                                     PROJECTED PRINCIPAL PAYMENTS BY ISSUE
                                                                                                     ($/000)

Yr. End       1990          1994           1995B            1997          1999            2000           2001             2003             2004            2005            2006            2007            2008         Total
June 30,   Amt     Cpn   Amt     Cpn     Amt    Cpn      Amt     Cpn   Amt     Cpn     Amt     Cpn    Amt     Cpn      Amt     Cpn      Amt     Cpn     Amt     Cpn     Amt     Cpn     Amt     Cpn     Amt     Cpn     Debt

 2010      325   7.100   230     5.900   265     4.900   110   5.300   70    4.500     205    5.250   180     4.000    685     3.500    665     2.500    525    3.500   805     4.000   550     4.000   800     3.000    5,469
 2011      325   7.100   230     6.000   265     5.000   110   5.350   70    4.600     115    5.250   180     4.100    750     3.500    680     2.625    385    3.500   835     4.000   550     4.000   800     3.000    5,353
 2012                    230     6.100   265     5.000   110   5.400   70    4.700     115    5.250   120     4.200    840     4.250    680     2.875    390    3.750   480     4.000   550     4.000   790     3.000    4,693
 2013                    230     6.100   265     5.000   110   5.450   70    4.800     115    5.500   115     4.300    925     4.250    690     3.125    395    3.750   510     4.000   225     4.000   790     3.125    4,493
 2014                    230     6.200   265     5.000   110   5.550   70    4.900     115    5.500   115     4.400    595     4.250    555     3.250    305    4.000   515     4.000   225     4.000   595     3.250    3,749
 2015                    230     6.200   265     5.000   110   5.600   70    4.950     115    5.500   115     4.500    685     4.250    215     3.500    315    4.000   530     4.000   225     4.000   580     3.250    3,510
 2016                                    265     5.000   110   5.650   70    5.000     115    5.500   115     4.600    780     4.250    225     3.500    250    4.000   505     4.000   225     4.000   570     3.250    3,276
 2017                                            5.000   110   5.700   70    5.050     115    5.750   115     4.700    885     4.250    235     3.750    230    4.000   185     4.000   225     4.000   570     3.250    2,786
 2018                                                                  70    5.100     115    5.750   115     4.800   1,005    4.250    245     3.750    240    4.000   190     4.000    25     4.000   575     3.350    2,619
 2019                                                                  70    5.150     115    5.750   115     5.000   1,135    4.250    255     4.000    250    4.000   195     4.000    25     4.000   185     3.500    2,385
 2020                                                                                  115    5.750   115     5.000   1,280    4.250    265     4.000    260    4.100   210     4.050    25     4.000   185     3.600    2,490
 2021                                                                                                 115     5.000   1,435    4.250    280     4.000    270    4.200   220     4.100    25     4.000   185     3.600    2,559
 2022                                                                                                                 1,610    4.300    290     4.000    280    4.250                    25     4.000   185     3.650    2,410
 2023                                                                                                                 1,800    4.400    305     4.125    290    4.250                                   185     3.700    2,593
 2024                                                                                                                  430     4.400    320     4.250    300    4.300                                   185     3.750    1,248
 2025                                                                                                                  450     4.500    335     4.250    315    4.500                                   185     3.850    1,298
 2026                                                                                                                  475     4.500    350     4.300    325    4.500                                   185     4.000    1,348
 2027                                                                                                                  495     4.500    365     4.300    340    4.500                                   185     4.000    1,398
 2028                                                                                                                  520     4.500    385     4.375    355    4.500                                   185     4.000    1,458
 2029                                                                                                                  545     4.500    400     4.400    370    4.600                                                    1,329
 2030                                                                                                                  570     4.500    420     4.400    385    4.600                                                    1,389
 2031                                                                                                                  595     4.500    440     4.400    405    5.000                                                    1,454
 2032                                                                                                                  625     4.500    460     4.400    420    5.000                                                    1,519
 2033                                                                                                                  655     4.500    480     4.400    440    5.000                                                    1,589
 2034                                                                                                                                   500     4.400    460    5.000                                                      969
 2035                                                                                                                                                    480    5.000                                                      485
 Totals    650           1,380           1,855           880           700            1,355           1,515           19,770           10,040           8,980           5,180           2,900           7,920           63,125
6.000



5.500

        1999

5.000   2000
        2001
        2003
4.500   2004
        2005
        2006
4.000
        2007
        2008
3.500



3.000
                           1997 Series Bonds                     1998 Series Bonds                1998B Series Bonds                  Consolidated Bonds

    FY                                                                                                                                Ref'd'd         A             B             C
   Year             Amount        Due        Coupon       Amount         Due      Coupon      Amount       Due       Coupon            Par       Ref'd'g Par   Ref'd'g Par   Ref'd'g Par

2009/2010            635,000     09/01/09      4.800      1,405,000    07/01/09      4.700     715,000    09/01/09    4.200          2,755,000    2,790,000             0             0
2010/2011            635,000     09/01/10      4.900      1,415,000    07/01/10      5.000     715,000    09/01/10    4.300          2,765,000    2,800,000     2,780,000     1,355,000
2011/2012            635,000     09/01/11      5.000      1,435,000    07/01/11      5.000     715,000    09/01/11    4.400          2,785,000    2,820,000     2,800,000     1,355,000
2012/2013            635,000     09/01/12      5.100      1,460,000    07/01/12      5.000     710,000    09/01/12    4.500          2,805,000    2,840,000     2,820,000     1,355,000
2013/2014            635,000     09/01/13      5.100        805,000    07/01/13      5.000     710,000    09/01/13    4.550          2,150,000    2,175,000     2,160,000     1,355,000
2014/2015            635,000     09/01/14      5.200                                           710,000    09/01/14    4.600          1,345,000    1,360,000     1,355,000     1,355,000
2015/2016            635,000     09/01/15      5.250                                           710,000    09/01/15    4.650          1,345,000    1,360,000     1,350,000     1,355,000
2016/2017            630,000     09/01/16      5.300                                           710,000    09/01/16    4.750          1,340,000    1,355,000     1,350,000     1,350,000
2017/2018            630,000     09/01/17      5.300                                           710,000    09/01/17    5.000          1,340,000    1,355,000     1,350,000     1,345,000
2018/2019                                                                                      710,000    09/01/18    5.000            710,000      720,000       715,000       710,000
  Totals           5,705,000                               6,520,000                          7,115,000                             19,340,000    19,575,000    16,680,000    11,535,000

      Call:                     09/01/08    @101                       07/01/08 @101                      09/01/08 @101
                                09/01/09    @100                       07/01/09 @100 1/2                  09/01/09 @100 1/2

                                                                                                                              Callable Bonds
                                                                                             all bonds;    09/01/08 @101             5,705,000         1997 Call Premium =        57,050
                                  A             B            C                        A      April 09; inc 07/01/08 @101             6,520,000         1998 Call Premium =        65,200
 Costs of Issue       Exp                                                                    09/10         09/01/08 @101             7,115,000        1998B Call Premium =        71,150
   B & Adv:          1.00/000     19,340        16,585       11,470                                                                 19,340,000                                   193,400
   Printing:           4,000       4,000         4,000        4,000
      Legal:           5,000       5,000         5,000        5,000                          all bonds;  09/01/09 @100              5,070,000          1997 Call Premium =             0
   Ratings:           11,500      11,500        11,500       11,500                   B      Sep 09; exc 07/01/09 @100 1/2          5,115,000          1998 Call Premium =        25,575
 Pay Agent:            2,950       2,950         2,950        2,950                          09/10       09/01/09 @100 1/2          6,400,000         1998B Call Premium =        32,000
Total C of I:                     42,790        40,035       34,920                                                                16,585,000                                     57,575
 Call Prem:                      193,400        57,575       32,000                          not 98 ;
  Total Exp:                     236,190        97,610       66,920                   C      Sep 09; exc 09/01/09 @100              5,070,000          1997 Call Premium =             0
                                                                                             09/10       09/01/09 @100 1/2          6,400,000         1998B Call Premium =        32,000
                                                                                                                                   11,470,000                                     32,000
           Absolute Savings = $1,944,617 $1,751,683      $1,540,883
                 PV Savings = $1,845,427 $1,663,503      $1,448,450
              % PV Savings =     9.5420% 10.0302%         12.6282%
          2009/2010 Savings = $431,569     $238,525       $163,465

				
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