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HOW DO YOU USE THE MONEY? <br /> • Make payments directly to Ca1PERS (continued): <br /> • Target specific amortization bases: <br /> ❑ Paying off shorter amortization bases, larger contribution savings over <br /> shorter period: <br /> O e.g. 10 year base gets 12.50 for $1 <br /> O Less interest savings compared to paying off longer amortization <br /> bases <br /> ❑ Paying off longer amortization bases, smaller contribution savings <br /> over longer period: <br /> O e.g. 25 year base gets 6.60 for$1 <br /> O More interest savings compared to paying off shorter amortization <br /> bases <br /> I� 1December 19,2017 63 <br /> HOW DO YOU USE THE MONEY? <br /> • Internal Service Fund <br /> • Typically used for rate stabilization <br /> • Restricted investments: <br /> ❑ Likely low(0.5%-1.0%) investment returns <br /> ❑ Short term/high quality, designed for preservation of principal <br /> • Assets can be used by Council for other purposes <br /> • Does not reduce Unfunded Liability <br /> December 19,2017 64 WOMPIONI <br />