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Kit Menkin's Leasing
News www.leasingnews.org
Wednesday, August 7, 2002 Accurate, fair and
unbiased news for the equipment Leasing Industry ( posted daily at www.leasingnews.org and sent by e-mail
by subscription with the Day
in American History signature .) Headlines--- Thalman Financial acquires Business Asset Funding LLC Sunrise Int. 2nd
Quarter Strong Results CapitalStream Technology
Enhancements Help Marlin Leasing NetBank Teams
up with Microsoft and Intuit Save This Date---August
20,2002--UAEL Nervous Eyes
On Greenspan's Big Shoes Wednesday---Odds
and Ends San Francisco
Bay Area Housing Crunch New ranking
finds U.S. cars lacking in resale value Excerpts from Assoc.Government Leasing &
Finance Newsletter NAELB
Announces 2003 Conference Schedule News
Briefs---plus Bonds 599 Giants
11,Cubs 10 ### Denotes Press Release __________________________________________________________________ ########### ############################ Thalman Financial, Inc. acquires Business Asset Funding LLC APPLE VALLEY, CA - Thalman Financial, Inc. announced that
it has acquired Business Asset Funding LLC (BAF), headquartered in Prescott,
AZ, and hired their senior management team.
BAF customer accounts will be integrated into Thalman's ongoing
customer development activities. "This acquisition expands our reach in the leasing industry
and allows us to continue the build out of a national platform for our
vendor development strategy under the Thalman brand," says Thalman
Chairman and CEO, Andrew Thorn. "Our
growth strategy is to expand selectively and substantially in the U.S.,
while continuing to invest in our core competencies." Both Andrew Thorn and BAF President Hal Hayden have been
in the industry for more than 15 years.
They met each other at a WAEL convention and have been friends
since. "I am looking forward
to combining our strengths," state Thorn.
He added "the process we went through to make this happen
identified many areas where we enhance each others capabilities. The combination of other key people within
our organizations will make it possible for us to accomplish our major
objectives ahead of schedule. Our
implementation plan is on target." "I am very excited about this partnership and believe
that by combining Thalman and BAF, we are creating a powerful team that
will maximize the opportunities in the market today," Hayden said. "Our two companies overlay one another
closely in terms of values, people, funding and technology. We are excited about our potential." Thalman offers high touch and high tech leasing solutions
to equipment manufacturers and distributors throughout the United States.
The firm continues to invest in new marketing and customer acquisition
and retention strategies. ( Andrew Thorn is a member of the Leasing News Advisory Board. Also see: Whatever happened to...Hal Hayden: http://www.leasingnews.org/whateverhappenedto/Hal%20Hayden.htm With the right business development people, they can only
find a win-win situation. editor ). ###################### # ##########################\ SUNRISE INTERNATIONAL LEASING REPORTS STRONG SECOND-QUARTER RESULTS (This company does
start-ups and new businesses for Sun Microsystem, Cisco, among others with a very strong bank line. They are
very successful. editor
) GOLDEN VALLEY, Minn., - Sunrise International Leasing Corporation
(SILC), a wholly owned subsidiary of privately held King Capital Corp.,
announced financial results for the second quarter and six months ended
June 30, 2002. The company reported net income of $3.4 million, up 6 percent
from $3.2 million for the comparable 2001 period. Profitability for this quarter was favorably
affected by improved quality of the company's portfolio and increased
demand for used equipment sold by Redirect Tech, the company's remarketing
subsidiary. Revenue decreased
40 percent to $31.7 million, compared to $52.4 million for the prior-year
period. For the six months ended June 30, 2002 net income decreased
9 percent to $6.1 million, from $6.7 million for the prior-year six months.
SILC reported revenue of $67.6 million, from $103.3 million for
the year-ago period. The year-to-date revenue decrease is a result of lower demand for
new leases. SILC is benefiting from a substantial improvement in its
portfolio credit loss experience which has allowed it to reduce its provisions
for bad debts and continue to record strong earnings. During the second quarter, the company also paid down $36 million
in debt, significantly reducing interest expense, and is now virtually
debt free. Outlook For the full year, SILC expects to exceed last year's record
of $12.6 million in after-tax net income despite the reduced demand for
leases. The improvement in the
credit quality of its portfolio will have a continuing favorable effect
on company profitability. Demand
for used equipment at favorable prices also is expected to continue. As previously
announced, the company plans to leverage its borrowing capacity and market
expertise to strategically pursue the acquisition of portfolios or other
leasing companies. About Sunrise International Leasing Corp SILC's business consists primarily of the development of
market-oriented vendor programs emphasizing the formulation of customized
lease and rental programs for vendors of high technology and other equipment. The lease options offered by the company generally
focus on short-term, fair market value leases. SILC is also a major reseller of high quality
off lease used equipment through Redirect Tech, its remarketing subsidiary. About King Capital Corp. King Capital Corporation, established in 1975 and based in
Golden Valley, Minn., offers a wide range of leasing options to manufacturers,
distributors and resellers through its primary subsidiary, Sunrise International
Leasing Corporation and high availability software through H.A. Technical
Solutions, LLC. SUNRISE INTERNATIONAL LEASING CORPORATION CONDENSED STATEMENTS OF INCOME Three Months Ended Six Months Ended June 30, June 30,
2002 2001
2002 2001 Revenues $ 31,690,000 $ 52,439,000 $
67,613,000 $103,265,000 Cost, expenses, and other
25,266,000 46,218,000 56,085,000 90,652,000 Income before provision for income
taxes
6,424,000 6,221,000 11,528,000
12,613,000 Provision for 3,018,000 3,051,000 5,417,000
5,928,000 income taxes Net Income $ 3,406,000 $ 3,170,000 $ 6,111,000 $ 6,685,000 King Capital Corp. 5500 Wayzata Boulevard, Suite 725 Golden Valley, Minnesota 55416 Peter J. King (763) 593-0051 ########## ##################################### CapitalStream Technology Enhancements Help Marlin Leasing
Provide Improved Customer Service CapitalStream provides Marlin Leasing the ability to give
Vendors and Brokers greater control and tracking capabilities with FinanceCenter's
ApplyNowä functionality Seattle, Wa - - CapitalStream (www.CapitalStream.com), a
Seattle-based provider of patent pending, commercial finance automation
technology for the finance service industry, today announced that Marlin
Leasing Corporation is its first customer to use an enhanced version of
ApplyNow, a specialized function of its FinanceCenterä Technology. With the new enhanced version of ApplyNow,
Marlin Leasing's vendors and brokers will be able to check on and respond
to the status of their transactions without having to go through the traditional
manual channels. The result will
be increased efficiency on both sides of the transaction. FinanceCenter allows Marlin Leasing's vendor and broker partners
to have their own ApplyNow links enabling the relationship of the customer
to be owned, managed, and maintained by Marlin's partners. Additionally, upon initial submission, the
logon identification and password will allow the user to come back and
create multiple quotes, submit multiple applications, and review a summary
of the use's origination activity, all leading to establishing a permanent
relationship between the vendor and the user.
This increased efficiency significantly improves customer service
and user satisfaction. "CapitalStream's continued enhancement of their technology
allows us to continue to grow our customer services," said Gary Shivers,
president of Marlin Leasing Corp. "By
providing our vendor and broker partners with greater control and tracking
capabilities we truly are giving them the ability to better service and
maintain their customer relationships." Previously the ApplyNow link placed on Marlin Leasing's partners
Web site allowed public users to submit a single business transaction
online and receive a logon id and password to maintain communication and
status between the user and Marlin Leasing, bypassing the vendor or broker. "Marlin Leasing's customers are now able to conduct
business more quickly and efficiently," said Carole McCluskey, CapitalStream's
Vice President of Client Services and Sales. "By fully implementing the enhanced version
of ApplyNow, Marlin is significantly empowering brokers and vendors throughout
the transaction process which will lead to greater customer service." About CapitalStream Seattle-based CapitalStream automates and streamlines commercial
finance processes for banks, finance companies, and manufacturers.
CapitalStream - FinanceCenterÔ, a patent pending technology, reduces
processing time, lowers costs, and enables companies to cost effectively
take advantage of new business opportunities by automating manual processes
for leases, loans, lines of credit, and credit cards. CapitalStream, an
established industry leader for more than six years with deep knowledge
about the inner workings of the financing world, has helped hundreds of
financial organizations increase their competitiveness, customer service
and profitability. About Marlin Leasing Corporation Marlin is a nationwide provider of quality leasing programs
to equipment vendors and their customers. Marlin's unique origination platform provides service to over 50,000
customers from its regional offices in Denver Colorado, Atlanta, Georgia,
and its headquarters in Mount Laurel, New Jersey. Contact Marline Leasing's corporate headquarters
at 1-888-479-9111 or at www.marlinleasing.com. ######### ######################## ################ NETBANK TEAMS UP WITH MICROSOFT AND INTUIT TO BOOST MARKETING NetBank ( owner of Republic Leasing of South Carolina ) announced
it entered into a new agreement with Microsoft and simultaneously extended
its agreement with Intuit to promote Microsoft Money and Intuit's Quicken software. The updated
versions of each product are slated to be released this summer. NetBank
will have its logo placed on the exterior of both products' packages,
and the products will both include an icon that will direct users to the
banks' promotional offers. NetBank will also get additional banner advertising
on both Qucken.com and MSN sites. Save This Date---August
20,2002 United Association of Equipment Leasing Los Angeles Region Sales and Use Tax Issues in Equipment Leasing Sales Tax on Documentation
fees? Radisson Hotel—Los
Angeles West Side 616 West Centinela Avenue Culver City, Ca. 950230 310-659-1776 Time: 2:00pm –2:30pm Registration
& Networking 2:30pm—5:00pm
Program Speakers: Sylvia Le, Senior Tax Auditor Eileen
Smith, Senior Tax Auditor (Both
speakers are from the Board of Equalization ) Cost: UAEL Members
$46.00 Non-Members
$56.00 Questions? Contact Tom Mulally or Lisa Murillo (818) 784-8700 __________________________________________________________________ Nervous Eyes On Greenspan's Big Shoes (With yesterdays addition of Bernanke and Kohn, President
Bush has now selected five of the seven Fed board members. Will he soon
be choosing a new chairman?) By John M. Berry Washington Post Staff Writer At 76, Alan Greenspan is the oldest Federal Reserve chairman
in history, and almost daily new rumors circulate that he is about to
fade into the wings after his long run on stage as the world's premier
central banker. In all probability, the rumors are wrong. Greenspan clearly
still relishes his powerful position, and he shows no sign of leaving
anytime soon, according to colleagues at the Fed, Bush administration
officials and others who see him, most of whom spoke on the condition
that they not be identified. But given Greenspan's age and other factors, including the
current turmoil in world financial markets, there is a slowly growing
sense of unease in the markets and among policymakers over the fact that
at some point someone else will have to take over his role. Early this year senior administration officials began assembling
lists of possible candidates, but the process has gone no further than
that, an official said. And while economists have speculated publicly
about the chances of several possibilities -- including Treasury Undersecretary
for International Affairs John B. Taylor, New York Federal Reserve Bank
President William J. McDonough and White House economic adviser Lawrence
B. Lindsey -- none of these figures has emerged as a likely choice, for
now. Among the reasons for unease is that there's no script for
a successor to follow. Greenspan's leadership of the Fed has been highly
personal, like that of many of his predecessors. Several books and countless
articles have been written about him, the way he has operated, and the
success or failure of his actions. But there's no "Greenspan method,"
no ready formula for a successor to apply. That has caused some economists
and one or two Fed officials to argue that the central bank should adopt
some type of rule, such as setting an explicit inflation target, to guide
the central bank's policy in the future. "Will Greenspan's tenure as Fed chairman leave a legacy
for future monetary policymakers, or will the successful policy of the
Greenspan era leave office with the man himself?" Harvard University
economics professor N. Gregory Mankiw asks in a recent book, "American
Economic Policy in the 1990s." If a successor wanted to continue that policy, "how
would he do it? The policy has never been fully explained. . . . The only
consistent policy seems to be: Study all the data carefully, and then
set interest rates at the right level. Beyond that, there are no clearly
stated guidelines," Mankiw said. A few Fed officials are confident a successor will be appointed
who will do as good a job as Greenspan. But some others have trouble visualizing
anyone else with Greenspan's experience, flexibility and credibility with
financial markets. Among other things, Greenspan's leadership of the Fed helped
calm financial markets after the stock market crash of 1987, the Russian
debt default in 1998 and the stock plunge that followed the Sept. 11 terrorist
attacks. He was way ahead of other economists in spotting the acceleration
of U.S. productivity growth in the 1990s, a shift that allowed the economy
to grow faster and the unemployment rate to fall further without causing
more inflation than virtually anyone else believed possible. As a result,
the Greenspan-led Fed held off squeezing the economy with higher interest
rates, and the country enjoyed some of the highest noninflationary growth
in a generation. And Greenspan's decision to make the central bank more open
in the way it publicly communicates its actions, views and plans has helped
soften congressional criticism of the Fed's traditional secrecy and gained
the Fed new power to influence the markets and the economy in the process. None of the candidates mentioned as possible successors has
similar credibility or influence. At best, they would have to achieve
it over time. But then so did Greenspan. In 1987, when White House officials made it clear they wanted
to dump Greenspan's predecessor, Paul A. Volcker, there were plenty of
skeptics in financial markets and in the top echelon at the Fed itself
who doubted that Greenspan could be up to the task. After all, in the
early 1980s, Volcker had led the difficult but successful fight against
the nation's most virulent inflation since the Civil War. Greenspan, unlike Volcker, had not been a public servant
for most of his working life. While he had been chairman of the Council
of Economic Advisers in the Ford administration and chairman of a commission
on Social Security reform in the early 1980s, he was known primarily as
the head of Townsend-Greenspan & Co., a New York-based economic consulting
and forecasting firm. As chairman, Greenspan has hardly operated in the Volcker
mold. He has proved to be much more deliberate in his decisions, basing
them on detailed analyses. And at least on the surface, Greenspan has
been more collegial in dealing with his Fed colleagues. Volcker was far
more freewheeling, by all accounts. "It's like trying to judge Beethoven and Mozart,"
said Robert V. DiClemente, an economist at Salomon Smith Barney in New
York. "It's a matter of taste." By law, the Fed has two main responsibilities, to achieve
stable prices and maximum employment -- and, as a sort of afterthought,
moderate interest rates. Sometimes, of course, it's hard for all three
of these conditions to coexist, and with only a single tool -- changes
in interest rates -- the central bank often can't move all of them in
the desired direction at once. Greenspan and other Fed officials maintain that the best
way for the central bank to maximize sustainable economic growth -- and
therefore maximize employment -- is to keep inflation very low. Importantly,
that argument is no longer challenged, as it was repeatedly until roughly
the late 1980s, by many members of Congress and executive branch officials. Perhaps the overriding concern among those worrying about
Greenspan's successor is whether he -- there are no women on any of the
published lists of possible appointees -- will be willing to take timely
action to keep inflation low. That's why some concerned economists would
like to see the Fed adopt a formal inflation target -- that is, that the
Fed seek to steer the economy so the annual rate of inflation stays in
a specific range, for example, between 1 percent and 3 percent. Even internally, the Fed has no specific inflation goal,
Fed officials said. Its top policymaking group, the Federal Open Market
Committee, last had a detailed discussion of whether setting such a goal
would be useful -- and if so, what the goal should be -- in 1996. According to transcripts of that year's FOMC meetings, there
was a consensus that inflation should not be allowed to rise above 3 percent
and probably should be lower than that. But there was no broad agreement
on how much lower, or even which inflation measure should be used. Only
one participant, J. Alfred Broaddus Jr., president of the Richmond Federal
Reserve Bank, strongly advocated setting a formal inflation target. Recent interviews showed that there's still little appetite
for a formal target among Fed officials, most of whom are quite happy
to use Greenspan's often- expressed general goal: an inflation rate low
enough that households and businesses do not take inflation into account
in making their economic decisions. When pressed, the chairman refuses
to be tied down to any specific number or range, which his colleagues
believe gives the Fed greater flexibility to respond to any inflation
threat. Aided by increased competition in many sectors of the economy
and an unexpected surge in economic efficiency in the late 1990s, Greenspan
and his Fed colleagues have managed to achieve what many of them regard
as price stability. For the past four years, inflation has averaged just
over 1.6 percent a year, according to the Fed's preferred measure of consumer
prices -- the personal consumption expenditure price index, excluding
food and energy items. At 1.6 percent, inflation is less than half the
roughly 4 percent rate that greeted Greenspan, and vastly less than the
9 percent demon that President Jimmy Carter appointed Volcker to tame
in 1979. Among the Fed's key actions in recent years was to raise
interest rates aggressively in 1994 when the economy threatened to overheat.
As a result, inflation remained subdued, and the Fed gained credibility
that, in the years since, has helped keep inflation expectations low and
allowed the Fed more leeway to let unemployment rates fall to 40-year
lows. Strong economic growth pushed unemployment down to just under
4 percent in late 2000 before joblessness began to rise again during last
year's recession. It stood at 5.9 percent in July. Nevertheless, Greenspan and the Fed have their critics. Some
currently complain that the central bank should have begun to raise interest
rates in early 1999 to cool off both the economy and the overheated stock
market. Higher rates sooner would have prevented the late stages of the
high-tech boom and made last year's slump milder, they argue. Others complain
that the Fed left rates too high too long after the stock market bubble
burst in the spring of 2000, contributing to the economic slump late that
year and in 2001. The debate about inflation targeting and even speculation
about possible Greenspan successors remains premature because a variety
of considerations suggest that Greenspan, assuming he remains in good
health, will stay as chairman well into 2005 and perhaps beyond. Greenspan still dominates the Fed's policymaking apparatus.
Interviews with numerous Fed officials indicate that he has the unanimous
respect of the other board members and the presidents of the dozen regional
Federal Reserve Banks who participate in policymaking. Nevertheless, rumors abound in financial markets here and
abroad that Greenspan plans to resign for one reason or another, such
as giving President Bush a chance to appoint a Republican successor before
the onset of the 2004 presidential election contest. At his confirmation hearing for his current four-year term
as Fed chairman, which expires June 20, 2004, Greenspan indicated to the
Senate Banking Committee that he planned to serve the full term. In the
past he has said that he regards such indications as a commitment, and
that argues against a resignation. Rather than a foreshortened term, some Fed watchers and administration
officials expect the opposite. They believe Bush will do what President
Clinton did in January 2000: keep the chairmanship out of election-year
politics by announcing a Greenspan reappointment months in advance of
the end of his term. Furthermore, if the Senate remains under Democratic control
after this year's election, no Bush appointee for the chairmanship other
than Greenspan would be likely to even get a confirmation hearing because
of the possible election of a Democrat to the White House in 2004. Under
law, when a chairmanship term expires without a successor confirmed, the
chairman can retain his powers if the board or the president designates
him as chairman pro tempore, which has happened twice with Greenspan. That means Greenspan could continue as chairman conceivably
beyond the expiration of his separate 14-year term as a member of the
board, which expires Jan. 31, 2006. A board member cannot be reappointed
once he has served a full term, which at that point Greenspan will have
done. But should Bush want Greenspan to stick around past early
2006, and the chairman were willing, the president could simply refrain
from appointing someone else. If Greenspan were to remain in office until
mid-May 2006, he would become not only the oldest Fed chairman in history
but also the longest-serving, eclipsing the 18 years, 9 months and 29
days served by William McChesney Martin Jr. beginning in April 1951. -------------------------------------------------------------------------------- Wednesday—Odds and Ends From: Chris Simpson <chris@creditleaseonline.com> In reference to your note in yesterdays newsletter about
using sources already established with this underwriter in order to get to them,
please note: 1. they did
not make us sign any reps and warranties excluding re-brokered transactions, but 2. max commission
available on any deal is only 8 pts., which may discourage having more than 1 broker in the deal. I hear so much from other brokers who claim to put 10
12 or even 15 points in a deal that I thought it might be of interest if
they were considering trying to get to this underwriter. Christopher Simpson CreditLease, Inc. --- Met with a mngr that is looking to buy companies with at
least $1 Bill in leases to tech companies. Know anyone? Anthony J DeToto Merrill Lynch US Private Client 800.933.5655 x3059 408.283.3059 direct 408.283.3190 fax 415.786.5406 mobile http://fc.ml.com/kpg -------------------------------- Assistants: Cynthia Cougoule 408.283.3182 Peter Krajewski 408.283.3078 ----------------- Sent from my BlackBerry Handheld. Formerly Richest Leasing Equipment Individual (He still may be,
but when he had ATEL, he was number #1. His successor has taken over this title. ) Dear Kit: I wanted to take
this moment to tell you that I enjoyed catching up with you yesterday.
My employees regularly read your newsletter and often rave about the great work
you do. Also, I wanted to thank
you for the kind piece you wrote about
Romel (please note the spelling-Ro for Rochelle and Mel for Melodie),
Cyberlease and about myself. As
you know, my passion has always been in
the equipment leasing business and in organizing the origination through
funding process. I have always
been a strong believer that automation is
the best way for all of us in the equipment leasing business to maximize
our revenue generation. This is
the whole idea behind Cyberlease:
to help the leasing business make more money by centralizing information,
eliminating redundancy in the application process, and providing
more services for its customers. I appreciate your
friendship and the work you so selflessly continue to provide to the industry
as a whole. Sincerely, A. J. Batt Romel Enterprises,
LLC Chairman & CEO 415-781-5501 x201
Direct 415-781-5566 Fax 561-658-8427 Efax >ajbatt@romel.biz mailto:ajbatt@romel.biz ((May I quote you. Readers like to hear from you. You are like the Bill Gates of the Leasing Industry ( I mean
in financial reward---although he is well respected as you are ).Editor
)) Kit, You may quote
me Again, thank you for the support. In these days of lower margins and a lot of
uncertainty, it feels good to know somebody out there remembers and some
people do care. a.j. ( I knew A.J. when he didn’t have much money. He cares about
his daughters, still visits his mother, and maybe you know him
as a successful entrepreneur, very smart business man, but he has many other
sides to his personality. Editor ). --------------------------------------------------------------------------------------------- Frest St. Laurent Please let my good friends know I have moved. You can also see a newer picture of my family here, Kit. http://www.fredstlaurent.com/new_page_2.htm and www.bwresults.com Fred St Laurent Senior Account Manager Bradbury and Williamson Inc. 321-952-1422 --- Ginny Young <GinnyYoung@bravacapital.com> Since you often include sports info in the newsletter, will
you please include a piece about Chick Hearn. Thanks, Laker Fan Extraordinare Ginny GinnyYoung@bravacapital.com http://www.nytimes.com/2002/08/07/obituaries/07HEAR.html http://www.latimes.com/sports/la-fi-broadcast7aug07.story?null -- Timothy Mortimer (tmortimer@peachtreefranchise.com)
thought you might like the following article from the Cincinnati Business Courier: I thought you might find this story interesting since you
mentioned it in your new letter. Employee hobbies can threaten network Instant messaging, radio streaming risky http://www.bizjournals.com/industries/high_tech/networking/2002/08/05/cincinnati_focus3.html __________________________________________________________________ THE HOUSING CRUNCH Bay Area faces hard choices in making housing affordable By Tracey Kaplan and Sue McAllister San Jose Mercury News For $198,000, you can get a new three-bedroom, 2,200-square-foot
house from Standard Pacific Homes, complete with two-car garage, marble
sinks and extensive landscaping. But you'll have to move to Dallas or Phoenix. To buy a similar Standard Pacific house in San Jose, you
pay $665,000 -- more than three times as much. The main reason isn't the cost of labor, materials or the
difference in profit margins, although they do contribute to the disparity.
It's the dirt. Stratospheric land prices are the paramount reason the Bay
Area has the nation's most expensive housing -- so costly that only a
quarter of the households can afford a median- priced house. The shortage
of affordable housing is the greatest economic threat facing the region,
economists warn. By understanding why dirt is so expensive, people in the
Bay Area can start to understand how difficult it is to imagine the situation
improving, and what kind of hard choices must be made if buying a home
here is ever to become affordable. To build enough housing for the 1 million new people expected
in the Bay Area by 2020 -- equal to adding the combined population of
Las Vegas and New Orleans -- residents and community leaders will have
to abandon long-held anti-tax and anti-growth policies, surrender some
local control to a regional government and accept more city-like neighborhoods
around them. The alternative is to stick with the current course: Let
housing woes continue to erode employers' ability to recruit and retain
employees, to sap the productivity of workers with long commutes and to
push families with moderate incomes inland, leaving the coast to those
who can afford it or are willing to pay high rents or share crowded quarters.
The Bay Area is already short more than 57,000 housing units, according
to some estimates. ``For life and the economy to remain vital,'' said Judy Nevis,
chief deputy director of the California Department of Housing and Community
Development, ``you have to figure out how to house not just a small portion
of people, but the whole.'' If you talk to builders, you find a number of costs are higher
in the Bay Area, not just land. Labor in Northern California is more expensive,
so it costs $143,000 to build an average three-bedroom San Jose house
compared with about $100,000 in Dallas. Developer fees to fund schools, parks and other services
also are higher for the San Jose house -- $29,000, compared with $5,000
in Dallas -- because California voters have sharply limited the property
taxes cities can levy while the state has grabbed a larger share of those
taxes. Those fees are passed on to home-buyers. Profits also are higher on the San Jose house: $99,750 or
15 percent before taxes compared with $9,900 or 5 percent in Dallas. The
company's money is at greater risk and tied up longer during California's
lengthier environmental review. But the biggest cost difference between Dallas and San Jose
is land: $232,000 for a tiny 2,400-square- foot lot in San Jose vs. $29,000
for a lot almost three times larger in Dallas. H O U S I N G C
O N S T R A I N T S How the supply of land is limited and housing prices driven
up: • Urban growth boundaries.
The Bay Area is the state's leader, with at least 20 urban boundaries
restricting development. • Local control over
land use. Each city looks out for its own interests, often at the expense
of the region as a whole. • Voter-approved
cap on property taxes. It started with Proposition 13 in 1978. Municipal
revenue dropped as a result, prompting many California cities to demand
the nation's highest impact fees from developers to pay for new schools,
roads and parks. Home- buyers ultimately foot the bill with higher housing
prices. • Liberal construction
defect laws. Production of relatively affordable condos and townhouses
in California has fallen 90‚percent since 1994, in part because a state
law allows homeowners up to 10 years to sue over construction defects. Source: Mercury News research New ranking finds U.S. cars lacking in resale value TRAVERSE CITY, Mich. (AP) U.S. carmakers fared poorly in
a first-ever ranking of auto resale values, with European and Japanese
brands expected to keep more of their worth as used car List of Highest Residual Value: Non-luxury brands: 1. Volkswagen: 52.2 percent 2. Honda, 49.7 percent 3. Toyota, 49.0 percent 4. Subaru, 47.8 percent 5. Nissan, 45.8 percent 6. Jeep, 44.1 percent 7. GMC, 42.6 percent Non-luxury average residual for 2002 Model Year: 41.8 percent.
Luxury brands: 1. Mercedes-Benz, 54.5 percent 2. BMW, 52.8 percent 3. Acura, 52.4 percent 4. Lexus, 50.6 percent 5. Audi, 49.2 percent Luxury Brand Average Residual For 2002 Model Year: 48.7 percent.
Source: Automotive Lease Guide --------------------------------------------------------------------------------- Excerpts fromt he Association of Government Leasing and Finance
Newsletter The August 2002 Edition of AGL&F's T.E.L.L. is now web-posted.
Please go to http://www.aglf.org/tell/
to find the following articles and other important AGL&F information. The next issue of T.E.L.L. will be released in September 2002, please contact AGL&F headquarters
(202.742.2453) should you wish to participate in the development
or solicitation of articles for T.E.L.L. - Deadline for submissions,
including address changes or other news is September 20. Thank you very much. Severability is No Substitution for a Well-Constructed Muni
Lease By David C. Kutcher - Chapman and Cutler Lessors in the municipal leasing market have continually
struggled with the effect of including a "non-substitution clause"
in their muni equipment lease-purchase agreements. For several years
lessors had taken the position that a properly drafted non-substitution
clause that is not overly burdensome on the lessee could
effectively dissuade a lessee from procuring similar equipment upon an
occurrence of an event of default without jeopardizing the validity
of the lease-purchase agreement. Click on the following link for more information: http://www.aglf.org/tell/august_10.html MEMBERSHIP DIRECTORY COMING SOON... Click on the following link for more information: http://www.aglf.org/tell/august_01.html SPRING CONFERENCE RECAP..... A special thank you is extended to Dan Harsh (Energy Systems
Group) and Evan Howe (Baystone Financial) for their leadership and
organization of this year's Spring Conference. Without them
the many enjoyable, informative and sometime controversial subject
matter would not have made Baltimore such a great success. Click on the following link for more information: http://www.aglf.org/tell/august_02.html SPRING CONFERENCE SPONSORS - THANK YOU! The Association for Governmental Leasing and Finance thanks
our 2002 Spring Conference Sponsors. The importance of their continued
support and generosity to the association and to the conference cannot
be stressed enough. Click on the following link for more information: http://www.aglf.org/tell/august_03.html SPONSOR THE 2002 EDITION OF THE 50 STATE SURVEY One of the chief member benefits of the Association for Governmental
Leasing and Finance is the Fifty State Survey. This is your
opportunity to sponsor the most recent and revised edition
of the manual............ Click on the following link for more information: http://www.aglf.org/tell/august_04.html NEW MEMBERS - since 4-30-02 Join us in welcoming the newest additions to AGL&F! Click on the following link for more information: http://www.aglf.org/tell/august_05.html MEMBERS ON THE MOVE Click on the following link for more information: http://www.aglf.org/tell/august_06.html 2002 22ND FALL ANNUAL CONFERENCE Save the date for our 22nd Annual Conferece in Orlando, Florida
at Disney's Yacht and Beach Club Resort - November 20-22nd.
Tentative schedule and other information at this link. Click on the following link for more information: http://www.aglf.org/tell/august_07.html SPONSOR THE 2002 FALL ANNUAL CONFERENCE Conference sponsors are very important to the success of
any conference, but especially our Annual Conference. We have
a great many activities planned and hope your company will be able
to help us make this a special conference for all attendees. Click on the following link for more information: http://www.aglf.org/tell/august_08.html 2003 MEETING SCHEDULE Click on the following link for more information: http://www.aglf.org/tell/august_09.html -- Graham Hauck Executive Director Association for Governmental Leasing and Finance 1255 23rd Street, NW Washington, DC 20037 202.742.AGLF (2453) fax: 202.833.3636 |