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After 17 long years, there is finally light at the end of the tunnel for Click! See the following email from Andy Cherullo, the CFO for City of Tacoma. The capital costs for building Click will be fully written off in just 4.8 years. By dividing the "Outstanding Telecommunications Plant" of $62,500,319 by the "Annual Depreciation" of $12,897,718, you get 4.84 years.

So, we are almost there!

From: Cherullo, Andy
Subject: RE: Thank You Andy -Re: time for a call? -Re: "Telecommunications Plant" assets?
To: Mitchell Shook
Date: Thu, 20 Nov 2014 13:02:00 -0800


Mitch - the answers to your questions are below in red.
Andy



 

Andy Cherullo, Finance Director
City of Tacoma
Tacoma, Washington

Dear Mr. CherulloNovember, 12th 2014

I saw your name on the 2013 TPU annual report and wondered if you might be the right person to help me understand something about the numbers on Page 52, pertaining to the report's "Telecommunications Plant " assets.

What do these "Telecommunications Plant" amounts include? Is this Click Network’s Capital Costs? Or are there other assets, besides Click in there –Inet perhaps? Yes, these are CLICK!’s assets and they do include I-Net.

I am trying to figure out how much is left to be amortized for Click Network. Do you know? Or, is there any public information that might help me understand the Click Network capital costs and how they are being amortized? A schedule of assets perhaps? These assets were funded by bonds issued by Tacoma Power between 2001 and 2010. The bond proceeds were utilized for multiple capital projects that included the CLICK! Network. These bonds will amortize over the next 20 years.

Since the "Book Cost" for the "Telecommunications Plant" shows $203,842,399 and the "Accumulated Depreciation" is $141,342,080. Would it be correct to conclude that the difference, of $62,500,319, is the outstanding Telecommunications Plant balance? Yes, this is the amount that still needs to be depreciated.

Finally, what is the "Annual Accrual CR.", of $12,897,718, for? Please see the attached screenshot, to show you what I mean. This is the annual depreciation.

Very truly yours,

Mitch.

P.S. also, what is that ($84,676,977) for Transfers & Adjustments is for? This is all Tacoma Power and CLICK! Construction Work in Progress that have been capitalized.

Mitchell Shook
CEO
Advanced Stream Broadband
P.O. Box 7641
Tacoma, WA 98417
253-627-8000 Office