(a) Net interest cost.-- Net interest cost may be determined by using either the street method or the present worth method, whichever method shall be specified in the official notice of sale. (b) Street method.-- Under the street method, a dollar amount shall be determined by computing the total amount of interest payable over the life of the series to stated maturity dates or earlier mandatory call dates and subtracting therefrom the amount of any premium paid above the aggregate principal amount of the bonds or notes or adding thereto the amount of any discount lawfully allowed in the sale. (c) Present worth method.-- Under the present worth method, there shall be ascertained the semiannual rate, compounded semiannually, necessary to discount to present worth as of the date of the bonds or notes, the amounts payable on each interest payment date and on each stated maturity or earlier mandatory redemption date so that the aggregate of such amounts will equal the purchase price offered therefor, exclusive of interest accrued to the date of delivery. The net interest cost shall be stated in terms of an annual percentage rate and shall be that rate of interest which is twice the semiannual rate so ascertained. (d) Net interest rate.-- The net interest rate for a series sold under the present worth method shall be the rate of the net interest cost. For a series sold under the street method, the net interest rate shall be determined by dividing the net interest cost by the product of $1,000 multiplied by the number of bond years from the date of the bonds or notes to the stated maturity or earlier mandatory call dates. A bond year shall be one full year that $1,000 of principal amount shall be outstanding and less than full years shall be fractionalized on a 360-day-year basis. CHAPTER 82 MISCELLANEOUS PROVISIONS Subchapter A. Department of Community and Economic Development B. Sinking Funds and Other Funds and Accounts C. Refunding of Debt D. Remedies E. Penalties F. Interest Rate Risk and Interest Cost Management SUBCHAPTER A DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT Sec. 8201. Certification to department of bond or note transcript or lease, guaranty, subsidy contract or other agreement. 8202. Filing of statements of noncompletion of sale with department. 8203. Fees for filing. 8204. Certificate of approval of transcript. 8205. Certificate of disapproval and correction of proceedings. 8206. Effect of failure of timely action by department. 8207. Records of department. 8208. Invalidity of instruments which are delivered without compliance with requirements or conditions precedent to issuance or delivery. 8209. Finality of proceedings as to validity of instruments. 8210. Power of department to define terms, issue rules and regulations and prescribe forms. 8211. Petitions for declaratory orders and complaints to department. Subchapter Heading. The heading of Subchapter A was amended May 5, 1998, P.L.301, No.50, effective in 60 days.
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