HomeMy WebLinkAbout#13 - 2025 Bond Issuance STAFF REPORT
DATE: June 17, 2025
REGULAR
TO: Mayor and Councilmembers
FROM: Clarissa Hadler, Finance Director
AGENDA ITEM: Set Sale Resolution - 2025 Bond Issuance
CORE STRATEGIES:
☐ Vibrant, inclusive, connected community ☐ Efficient, reliable, innovative services ☐ Responsive, transparent, adaptive governance ☒ Balanced Finances now and future
☐ Managed Growth
BACKGROUND:
Each year, the city determines how much money it would like to bond for to complete the capital projects
it has planned. In 2024, staff received direction from the Council to begin to decrease the amount the city
bonds for projects, so this year, of the approximately $6 Million in Infrastructure Capital Projects for
2025, only $2,185,000 will come from bonding.
The Council has previously approved the project we will be bonding for this year. The 2025 Street
Improvements is considered a single construction project but encompasses improvements in five areas of
the city;
• 55th Street / 57th Street / Julep Way
• Irish Court
• Lake Elmo Vista Neighborhood (55th St)
• Prairie Hamlet Neighborhood (59th St Ct N)
• Teal Pass Estates Neighborhood (Jerome Ave N / Jasper Ave N / 49th St)
ISSUE BEFORE COUNCIL:
Should the Council authorize the issuance and sale of $ 2,185,000 general obligation bonds?
PROPOSAL DETAILS/ANALYSIS:
Tammy Omdahl from Northland Securities will be at the meeting to go over the finance plan, which is
included in your packet, and answer any questions you may have. Also included in the packet is the
resolution to authorize the issuance and sale of the bonds. Bids are due the morning of July 15th and Council
would take final action on approving the bonds at the meeting that evening. At this time the interest rates
are an estimate and won’t be known until July 15th.
Per the City Special Assessment Policy, a portion of the project (approx. 30%) will be assessed to
benefitting properties. These assessments are payable over 15 years and will be used to pay a portion of the
bonds. The remaining portion will be paid via the debt levy. The 2025A issuance is expected to require a
debt levy of an average of $226,000 for ten years.
Lastly, included in your packet is the Municipal Advisory Service Agreement with Northland Securities
Inc. The agreement sets out the services Northland will provide in the bond issuance and compensation of
$ 31,388.50. The agreement is just for this bond issuance and will expire 60 days after the closing on the
bonds in August.
FISCAL IMPACT:
The estimated levy schedule can be found on page 9 of the finance plan. The city is required to levy 105%
of the general fund portion of the improvement (street) projects.
OPTIONS:
1) Approve Resolution No. 2025-045
2) Amend and then Approve Resolution No 2025-045
3) Do not authorize the issuance of bonds
RECOMMENDATION:
Motion to approve Resolution No. 2025 - 045: A Resolution Providing for the Competitive Negotiated
Sale of $2,185,000 General Obligation Improvement Bonds, Series 2025A
AND
Motion to approve the Municipal Services Agreement with Northland Securities, Inc.
ATTACHMENTS:
• Finance Plan
• Resolution No 2025-045
• Municipal Advisory Services Agreement with Northland Securities, Inc.
Finance Plan
City of Lake Emo, Minnesota
$2,185,000
General Obligation Improvement Bonds, Series
2025A
June 17, 2025
150 South 5th Street, Suite 3300
Minneapolis, MN 55402
612-851-5900 800-851-2920
www.northlandsecurities.com
Member FINRA and SIPC | Registered with SEC and MSRB
Northland Securities, Inc. Page 2
Contents
Executive Summary ............................................................................................................................... 2
Issue Overview ....................................................................................................................................... 3
Purpose ........................................................................................................................................................ 3
Authority ..................................................................................................................................................... 3
Structure ...................................................................................................................................................... 3
Security and Source of Repayment ................................................................................................... 3
Plan Rationale ............................................................................................................................................ 4
Issuing Process .......................................................................................................................................... 4
Attachment 1 – Preliminary Debt Service Schedules ........................................................................ 5
Attachment 2 – Estimated Levy Schedules ......................................................................................... 6
Attachment 3 – Related Considerations .............................................................................................. 7
Bank Qualification ............................................................................................................................ 7
Arbitrage Compliance .................................................................................................................... 7
Continuing Disclosure .................................................................................................................... 7
Premiums ............................................................................................................................................. 8
Rating .................................................................................................................................................... 8
Attachment 4 – Calendar of Events ...................................................................................................... 9
Attachment 5 - Risk Factors ................................................................................................................. 11
Northland Securities, Inc. Page 2
Executive Summary
The following is a summary of the recommended terms for the issuance of $2,185,000 General
Obligation Improvement Bonds, Series 2025A (the “Bonds”). Additional information on the
proposed finance plan and issuing process can be found after the Executive Summary, in the
Issue Overview and Attachment 3 – Related Considerations.
Purpose Proceeds from the Bonds will be used to finance the City’s 2025
street projects and to pay costs associated with the issuance of
the Bonds.
Security The Bonds will be a general obligation of the City. The City will
pledge special assessments collected from benefitted properties
and ad valorem taxes for payment on the Bonds.
Repayment Term The Bonds will mature annually each February 1 in the years
2027 through 2036. Interest on the Bonds will be payable on
August 1, 2026, and semiannually thereafter on each February
1 and August 1.
Estimated Interest Rate True interest cost (TIC): 4.18%
Prepayment Option Bonds maturing on and after February 1, 2034, will be subject
to redemption on February 1, 2033, and any day thereafter at a
price of par plus accrued interest.
Rating A rating will be requested from Moody’s Investor Services
(“Moody’s”). The City’s general obligation debt is currently
rated "Aa1” by Moody’s.
Tax Status The Bonds will be tax-exempt, bank qualified obligations.
Risk Factors There are certain risks associated with all debt. Risk factors
related to the Bonds are discussed in Attachment 5.
Type of Bond Sale Public Sale – Competitive Bids
Proposals Received Tuesday, July 15, 2025 @ 10:00 A.M.
Council Consideration Tuesday, July 15, 2025 @ 7:00 P.M.
Northland Securities, Inc. Page 3
Issue Overview
Purpose
Proceeds from the Bonds will be used to finance the City’s 2025 street projects and to pay costs
associated with issuing the Bonds. The Bonds have been sized based on estimates provided by
the City. The table below contains the sources and uses of funds for the bond issue.
Authority
The Bonds will be issued pursuant to the authority of Minnesota Statutes, Chapters 429 and 475.
Under Chapter 429, an Improvement means any type of improvement made under authority
granted by section 429.021, which includes, but is not limited to, improvements to streets and
sidewalks, storm and sanitary sewer systems, and street lighting systems.
Before issuing bonds under Chapter 429, the City must hold a public hearing on the
Improvements and the proposed bonds and must then pass a resolution ordering the
improvements by at least a 4/5 majority. Public hearings have been held for the Improvement
Portion and all corresponding resolutions have passed with at least a 4/5 majority.
Structure
The Bonds have been structured over 10 years, with relatively level annual debt service
payments beginning on February 1, 2027.
The proposed structure for the bond issue and preliminary debt service projections are
illustrated in Attachment 1 and the estimated levy schedule is illustrated in Attachment 2.
Security and Source of Repayment
The Bonds will be general obligations of the City. The finance plan relies on the following
assumptions for the revenues used to pay debt service, as provided by City staff:
• Special Assessments. The City is expected to levy special assessments against benefited
properties in the amount of $630,000. The assessments will be payable over 15 years, with
an interest rate of 1.00% over the average coupon of the Bonds (currently estimated to be
5.00%) and structured for level annual payments of principal and interest. Because the
special assessments are structured over 15 years, revenues will continue to be received
beyond the life of the Bonds. The plan assumes that the assessments will be levied in 2025
for initial payment in 2026.
• Property Taxes. The remaining revenues needed to pay debt service on the Bonds are
expected to come from property tax levies. The initial projections show an annual tax
levy averaging approximately $226,000 is needed to produce the statutory requirement of
105% of debt service after accounting for assessments and utility revenues. The levy may
be adjusted annually based on actual special assessment collections and additional
Sources Of Funds
Par Amount of Bonds $2,185,000.00
Total Sources $2,185,000.00 Uses Of Funds
Deposit to Project Construction Fund 2,100,000.00
Costs of Issuance 57,113.50
Total Underwriter's Discount (1.250%)27,312.50
Rounding Amount 574.00
Total Uses $2,185,000.00
Northland Securities, Inc. Page 4
monies in the debt service fund. The initial tax levy will be made in 2025 for taxes
payable in 2026.
Plan Rationale
The Finance Plan recommended in this report is based on a variety of factors and information
provided by the City related to the financed project and City objectives, Northland’s knowledge
of the City and our experience in working with similar cities and projects. The issuance of
General Obligation Improvement Bonds provides the best means of achieving the City’s
objectives and cost-effective financing. The City has successfully issued and managed this type
of debt for previous projects.
Issuing Process
Northland will receive bids to purchase the Bonds on Tuesday, July 15, at 10:00 AM. Market
conditions and the marketability of the Bonds support issuance through a competitive sale. This
process has been chosen as it is intended to produce the lowest combination of interest expense
and underwriting expense on the date and time set to receive bids. The calendar of events for
the issuing process can be found in Attachment 4.
Municipal Advisor: Northland Securities, Inc., Minneapolis, Minnesota
Bond Counsel: Kutak Rock LLP, Minneapolis, Minnesota
Paying Agent: U.S. Bank Trust Company, National Association, St. Paul, Minnesota
Northland Securities, Inc. Page 5
Attachment 1 – Preliminary Debt Service Schedules
*Assumes Bank Qualified “Aa1” Rates as of June 9, 2025, plus 0.50%.
Date Principal Coupon Interest Total P+I Fiscal Total
08/14/2025 -----
08/01/2026 --81,164.26 81,164.26 -
02/01/2027 150,000.00 3.500%42,102.50 192,102.50 273,266.76
08/01/2027 --39,477.50 39,477.50 -
02/01/2028 195,000.00 3.500%39,477.50 234,477.50 273,955.00
08/01/2028 --36,065.00 36,065.00 -
02/01/2029 200,000.00 3.550%36,065.00 236,065.00 272,130.00
08/01/2029 --32,515.00 32,515.00 -
02/01/2030 210,000.00 3.650%32,515.00 242,515.00 275,030.00
08/01/2030 --28,682.50 28,682.50 -
02/01/2031 215,000.00 3.750%28,682.50 243,682.50 272,365.00
08/01/2031 --24,651.25 24,651.25 -
02/01/2032 225,000.00 3.850%24,651.25 249,651.25 274,302.50
08/01/2032 --20,320.00 20,320.00 -
02/01/2033 235,000.00 3.950%20,320.00 255,320.00 275,640.00
08/01/2033 --15,678.75 15,678.75 -
02/01/2034 240,000.00 4.050%15,678.75 255,678.75 271,357.50
08/01/2034 --10,818.75 10,818.75 -
02/01/2035 250,000.00 4.150%10,818.75 260,818.75 271,637.50
08/01/2035 --5,631.25 5,631.25 -
02/01/2036 265,000.00 4.250%5,631.25 270,631.25 276,262.50
Total $2,185,000.00 -$550,946.76 $2,735,946.76 -
Yield Statistics
Bond Year Dollars $13,883.60
Average Life 6.354 Years
Average Coupon 3.9683286%
Net Interest Cost (NIC)4.1650536%
True Interest Cost (TIC)4.1819569%
Bond Yield for Arbitrage Purposes 3.9516071%
All Inclusive Cost (AIC)4.6767382% IRS Form 8038
Net Interest Cost 3.9683286%
Weighted Average Maturity 6.354 Years Optional Redemption
02/01/2033 @100.000%
Northland Securities, Inc. Page 6
Attachment 2 – Estimated Levy Schedules
Date Total P+I 105% Levy
Less:
Special
Assessment
Revenue*Net Levy
Levy
Year
Collection
Year
02/01/2026 ----
02/01/2027 273,266.76 286,930.10 61,064.95 225,865.15 2025 2026
02/01/2028 273,955.00 287,652.75 61,064.95 226,587.80 2026 2027
02/01/2029 272,130.00 285,736.50 61,064.95 224,671.55 2027 2028
02/01/2030 275,030.00 288,781.50 61,064.95 227,716.55 2028 2029
02/01/2031 272,365.00 285,983.25 61,064.95 224,918.30 2029 2030
02/01/2032 274,302.50 288,017.63 61,064.95 226,952.68 2030 2031
02/01/2033 275,640.00 289,422.00 61,064.95 228,357.05 2031 2032
02/01/2034 271,357.50 284,925.38 61,064.95 223,860.43 2032 2033
02/01/2035 271,637.50 285,219.38 61,064.96 224,154.42 2033 2034
02/01/2036 276,262.50 290,075.63 61,064.95 229,010.68 2034 2035
02/01/2037 --61,064.95 -2035 2036
02/01/2038 --61,064.95 -2036 2037
02/01/2039 --61,064.96 -2037 2038
02/01/2040 --61,064.95 -2038 2039
02/01/2041 --61,064.96 -2039 2040
Total $2,735,946.76 $2,872,744.10 $915,974.28 $2,262,094.59
*Special assessment revenue is based on assessments totaling $630,000 assessed at a rate of 5.00% (1% over
the average coupon, rounded up to the nearest 0.25%), spread over 15 years with equal annual payments.
Northland Securities, Inc. Page 7
Attachment 3 – Related Considerations
Bank Qualification
We understand the City (in combination with any subordinate taxing jurisdictions or debt
issued in the City’s name by 501(c)3 corporations) anticipates issuing $10,000,000 or less in tax-
exempt debt during this calendar year. Therefore, the Bonds will be designated as “bank
qualified” obligations pursuant to Federal Tax Law.
Arbitrage Compliance
Project/Construction Fund. All tax-exempt bond issues are subject to federal rebate
requirements which require all arbitrage earned to be rebated to the U.S. Treasury. A rebate
exemption the City expects to qualify for is the “small issuer” exemption because the City
expects to issue less than $5,000,000 of tax-exempt bonds, including any 501(c)3 conduit
financings, in calendar year 2025.
Debt Service Fund. The City must maintain a bona fide debt service fund for the Bonds or be
subject to yield restriction in the debt service fund. A bona fide debt service fund involves an
equal matching of revenues to debt service expense with a balance forward permitted equal to
the greater of the investment earnings in the fund during that year or 1/12 of the debt service of
that year.
The City should become familiar with the various Arbitrage Compliance requirements for this
bond issue. The Resolution for the Bonds prepared by Bond Counsel explains the requirements
in greater detail.
Continuing Disclosure
Type: Full
Dissemination Agent: Northland Securities, Inc.
The requirements for continuing disclosure are governed by SEC Rule 15c2-12. The primary
requirements of Rule 15c2-12 actually fall on underwriters. The Rule sets forth due diligence
needed prior to the underwriter’s purchase of municipal securities. Part of this requirement is
obtaining commitment from the issuer to provide continuing disclosure. The document
describing the continuing disclosure commitments (the “Undertaking”) is contained in the
Official Statement that will be prepared to offer the Bonds to investors.
The City has more than $10,000,000 of outstanding debt and is required to undertake “full”
continuing disclosure. Full disclosure requires annual posting of the audit and a separate
continuing disclosure report, as well as the reporting of certain “material events.” Material
events set forth in the Rule, including, but not limited to, bond rating changes, call notices and
issuance of “financial obligations” (such as USDA loans, Public Finance Authority loans, and
lease agreements), must be reported within ten days of occurrence. The report contains annual
financial information and operating data that “mirrors” material information presented in the
Official Statement. The specific contents of the annual report will be described in the
Undertaking that appears in the appendix of the Official Statement. Northland currently serves
as dissemination agent for the City, assisting with the annual reporting. The information for the
Bonds will be incorporated into our reporting.
Northland Securities, Inc. Page 8
Premiums
In the current market environment, it is likely that bids received from underwriters will include
premiums. A premium bid occurs when the purchaser pays the City an amount in excess of the
par amount of a maturity in exchange for a higher coupon (interest rate). The use of premiums
reflects the bidder’s view on future market conditions, tax considerations for investors and
other factors. Ultimately, the true interest cost (“TIC”) calculation will determine the lowest bid,
regardless of premium.
A premium bid produces additional funds that can be used in several ways:
• The premium means that the City needs less bond proceeds and can reduce the size of
the issue by the amount of the premium.
• The premium can be deposited in the Construction Fund and used to pay additional
project costs, rather than used to reduce the size of the issue.
• The premium can be deposited in the Debt Service Fund and used to pay principal and
interest.
Northland will work with City staff prior to the sale day to determine use of premium (if any).
Rating
A rating will be requested from Moody’s Investor Services. The City’s general obligation debt is
currently rated "Aa1" by Moody’s. The rating process will include a conference call with the
rating analyst. Northland will assist City staff in preparing for and conducting the rating call.
Northland Securities, Inc. Page 9
Attachment 4 – Calendar of Events
The following checklist of items denotes each milestone activity as well as the members of the
finance team who will have the responsibility to complete it. Please note this proposed timetable
assumes regularly scheduled City Council meetings.
Date Action Responsible Party
May 6 Public Improvement Hearing for 2025 Street and
Drainage Improvements. Council Orders the
improvements (4/5 vote)
City Council Action,
City Staff
May 7 City provides bond counsel documentation of public
improvement proceedings to Bond Counsel
City Staff, Bond
Counsel
May 8 City confirms the project costs to be included in the
Finance Plan and for Set Sale Resolution
City Staff
May 9 General Information Certificate Relating to the
Issuance of the Bonds sent to the City
Northland
May 23 General Information Certificate Returned to Northland City Staff
June 9 Preliminary Official Statement Sent to City for Sign Off
and to Rating Agency (Moody’s)
City Staff, Northland
June 10 Set Sale Resolution and Finance Plan Sent to City for
Council Packets
Northland, Bond
Counsel
June 17 Set Sale Resolution Adopted and review of Finance
Plan – 7:00 p.m.
City Council Action,
Northland, Bond
Counsel
May 2025 June 2025
Sun Mon Tue Wed Thu Fri Sat Sun Mon Tue Wed Thu Fri Sat
1 2 3 1 2 3 4 5 6 7
4 5 6 7 8 9 10 8 9 10 11 12 13 14
11 12 13 14 15 16 17 15 16 17 18 19 20 21
18 19 20 21 22 23 24 22 23 24 25 26 27 28
25 26 27 28 29 30 31 29 30
July 2025 August 2025
Sun Mon Tue Wed Thu Fri Sat Sun Mon Tue Wed Thu Fri Sat
1 2 3 4 5 1 2
6 7 8 9 10 11 12 3 4 5 6 7 8 9
13 14 15 16 17 18 19 10 11 12 13 14 15 16
20 21 22 23 24 25 26 17 18 19 20 21 22 23
27 28 29 30 31 24 25 26 27 28 29 30
31
Holiday
Northland Securities, Inc. Page 10
Date Action Responsible Party
June 25 Comments and Signoff on POS due to Northland
City confirms amounts for project costs to be financed
and use of premium, if any
City Staff
Week of June 23 or
June 30
Rating Conference Call Northland, City Staff,
Rating Agency
July 7 Rating Received Rating Agency, City
Staff, Northland
July 8 Awarding Resolution sent to City Bond Council,
Northland
July 15 Bond Sale – 10:00 a.m.
Awarding Resolution Adopted – 7:00 p.m.
City Council Action,
Northland, Bond
Counsel
August 14 Closing on the Bonds Northland, City Staff,
Bond Counsel
Northland Securities, Inc. Page 11
Attachment 5 - Risk Factors
Property Taxes: Property tax levies shown in this Finance Plan are based on projected debt
service and other revenues. Final levies will be set based on the results of sale. Levies should be
reviewed annually and adjusted as needed. The debt service levy must be included in the
preliminary levy for annual Truth in Taxation hearings. Future Legislative changes in the
property tax system, including the imposition of levy limits and changes in calculation of
property values, would affect plans for payment of debt service. Delinquent payment of
property taxes would reduce revenues available to pay debt service.
Special Assessments: Special assessments for the financed projects have not been levied at this
time. This Finance Plan is based on the assumptions listed earlier in this report. Changes in the
terms and timing for the actual assessments will alter the projected flow of funds for payment of
debt service on the Bonds. Also, special assessments may be prepaid. It is likely that the income
earned on the investment of prepaid assessments will be less than the interest paid if the
assessments remained outstanding. Delinquencies in assessment collections would reduce
revenues needed to pay debt service. The collection of deferred assessments, if any, has not
been included in the revenue projections. Projected assessment income should be reviewed
annually and adjusted as needed.
General: In addition to the risks described above, there are certain general risks associated with
the issuance of bonds. These risks include, but are not limited to:
• Failure to comply with covenants in bond resolution.
• Failure to comply with Undertaking for continuing disclosure.
• Failure to comply with IRS regulations, including regulations related to use of the proceeds
and arbitrage/rebate. The IRS regulations govern the ability of the City to issue its bonds as
tax-exempt securities and failure to comply with the IRS regulations may lead to loss of tax-
exemption.
4925-0715-6784.2
EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE
CITY OF LAKE ELMO, MINNESOTA
HELD: June 17, 2025
Pursuant to due call and notice thereof, a regular meeting of the City Council of the City
of Lake Elmo, Washington County, Minnesota, was duly held at the City Hall in said City on the
17th day of June, 2025, at 7:00 o’clock P.M. for the purpose in part of authorizing the
competitive negotiated sale of the $2,185,000 General Obligation Improvement Bonds, Series
2025A of said City.
The following members were present:
and the following were absent:
Member ____________ introduced the following resolution and moved its adoption:
CITY OF LAKE ELMO
WASHINGTON COUNTY
STATE OF MINNESOTA
RESOLUTION NO. 2025 - 045
RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED
SALE OF $2,185,000 GENERAL OBLIGATION
IMPROVEMENT BONDS, SERIES 2025A
WHEREAS, the City Council of the City of Lake Elmo, Minnesota, (the “City”) has
heretofore determined that it is necessary and expedient to issue its $2,185,000 General
Obligation Improvement Bonds, Series 2025A (the “Bonds”) to finance the (i) City’s 2025 street
improvement projects; and (ii) costs of issuing the Bonds; and
WHEREAS, the City has retained Northland Securities, Inc., in Minneapolis, Minnesota
(“Northland”), as its independent municipal advisor and is therefore authorized to sell these
obligations by a competitive negotiated sale in accordance with Minnesota Statutes, Section
475.60, Subdivision 2(9); and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lake Elmo,
Minnesota, as follows:
2
4925-0715-6784.2
1. Authorization; Findings. The City Council hereby authorizes Northland to solicit
bids for the competitive negotiated sale of the Bonds.
2. Meeting; Bid Opening. This City Council shall meet at the time and place
specified in the Notice of Sale attached hereto as Exhibit A for the purpose of considering sealed
bids for, and awarding the sale of, the Bonds. The City Finance Director, or designee, shall open
bids at the time and place specified in such Notice of Sale.
3. Notice of Sale. The terms and conditions of the Bonds and the negotiation thereof
are fully set forth in the “Notice of Sale” attached hereto as Exhibit A and hereby approved and
made a part hereof.
4. Official Statement. In connection with said competitive negotiated sale, the City
Administrator and other officers or employees of the City are hereby authorized to cooperate
with Northland and participate in the preparation of an official statement for the Bonds, and to
execute and deliver it on behalf of the City upon its completion.
The motion for the adoption of the foregoing resolution was duly seconded by member
_____________ and, after full discussion thereof and upon a vote being taken thereon, the
following voted in favor thereof:
Approved this 17th day of June, 2025, by the City Council of the City of Lake Elmo, Minnesota.
CITY OF LAKE ELMO, MINNESOTA
_________________________________
Charles Cadenhead, Mayor
ATTEST:
________________________________
Julie Johnson, City Clerk
A-1
4925-0715-6784.2 LA515-142-947183.v1
EXHIBIT A
NOTICE OF SALE
$2,185,000*
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2025A
CITY OF LAKE ELMO, MINNESOTA
(Book-Entry Only)
NOTICE IS HEREBY GIVEN that these Bonds will be offered for sale according to the following terms:
TIME AND PLACE:
Proposals (also referred to herein as “bids”) will be opened by the City’s Finance Director, or designee,
on Tuesday, July 15, 2025, at 10:00 A.M., CT, at the offices of Northland Securities, Inc. (the Issuer’s
“Municipal Advisor”), 150 South 5th Street, Suite 3300, Minneapolis, Minnesota 55402. Consideration of
the Proposals for award of the sale will be by the City Council at its meeting at the City Offices beginning
Tuesday, July 15, 2025 at 7:00 P.M., CT.
SUBMISSION OF PROPOSALS
Proposals may be:
a) submitted to the office of Northland Securities, Inc.,
b) emailed to PublicSale@northlandsecurities.com
c) for proposals submitted prior to the sale, the final price and coupon rates may be submitted to
Northland Securities, Inc. by telephone at 612-851-5900 or 612-851-4945, or
d) submitted electronically.
Notice is hereby given that electronic proposals will be received via PARITY™, or its successor, in the
manner described below, until 10:00 A.M., CT, on Tuesday, July 15, 2025. Proposals may be submitted
electronically via PARITY™ or its successor, pursuant to this Notice until 10:00 A.M., CT, but no
Proposal will be received after the time for receiving Proposals specified above. To the extent any
instructions or directions set forth in PARITY™, or its successor, conflict with this Notice, the terms of
this Notice shall control. For further information about PARITY™, or its successor, potential bidders may
contact Northland Securities, Inc. or i-Deal at 1359 Broadway, 2nd floor, New York, NY 10018,
telephone 212-849-5021.
Neither the Issuer nor Northland Securities, Inc. assumes any liability if there is a malfunction of
PARITY™ or its successor. All bidders are advised that each Proposal shall be deemed to constitute a
contract between the bidder and the Issuer to purchase the Bonds regardless of the manner in which the
Proposal is submitted.
BOOK-ENTRY SYSTEM
The Bonds will be issued by means of a book-entry system with no physical distribution of bond
certificates made to the public. The Bonds will be issued in fully registered form and one bond certificate,
representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the
name of Cede & Co. as nominee of Depository Trust Company (“DTC”), New York, New York, which
will act as securities depository of the Bonds.
* The Issuer reserves the right to increase or decrease the principal amount of the Bonds. Any such increase or
decrease will be made in multiples of $5,000 and may be made in any maturity. If any maturity is adjusted, the
purchase price will also be adjusted to maintain the same gross spread.
2
4925-0715-6784.2
Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof
of a single maturity through book entries made on the books and records of DTC and its participants.
Principal and interest are payable by the Issuer through U.S. Bank Trust Company, N.A., St. Paul,
Minnesota (the “Paying Agent/Registrar”), to DTC, or its nominee as registered owner of the Bonds.
Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC;
transfer of principal and interest payments to beneficial owners by participants will be the responsibility
of such participants and other nominees of beneficial owners. The successful bidder, as a condition of
delivery of the Bonds, will be required to deposit the bond certificates with DTC. The Issuer will pay
reasonable and customary charges for the services of the Paying Agent/Registrar.
DATE OF ORIGINAL ISSUE OF BONDS
Date of Delivery (Estimated to be August 14, 2025)
AUTHORITY/PURPOSE/SECURITY
The Bonds are being issued pursuant to Minnesota Statutes, Chapters 429 and 475, as amended. Proceeds
will be used to finance the City’s 2025 street improvement projects, and to pay costs associated with the
issuance of the Bonds. The Bonds are payable from special assessments against benefited properties and
additionally secured by ad valorem taxes on all taxable property within the City. The full faith and credit
of the Issuer is pledged to their payment and the Issuer has validly obligated itself to levy ad valorem
taxes in the event of any deficiency in the debt service account established for this issue.
INTEREST PAYMENTS
Interest is due semiannually on each February 1 and August 1, commencing August 1, 2026, to registered
owners of the Bonds appearing of record in the Bond Register as of the close of business on the fifteenth
day (whether or not a business day) of the calendar month next preceding such interest payment date.
MATURITIES
Principal is due annually on February 1, inclusive, in each of the years and amounts as follows:
Year Amount Year Amount
2027 $150,000 2032 $225,000
2028 195,000 2033 235,000
2029 200,000 2034 240,000
2030 210,000 2035 250,000
2031 215,000 2036 265,000
Proposals for the Bonds may contain a maturity schedule providing for any combination of serial bonds
and term bonds, subject to mandatory redemption, so long as the amount of principal maturing or subject
to mandatory redemption in each year conforms to the maturity schedule set forth above.
INTEREST RATES
All rates must be in integral multiples of 1/20th or 1/8th of 1%. The rate for any maturity may not be
more than 2.00% less than the rate for any preceding maturity. All Bonds of the same maturity must bear
a single uniform rate from date of issue to maturity.
ESTABLISHMENT OF ISSUE PRICE
(HOLD-THE-OFFERING-PRICE RULE MAY APPLY – BIDS NOT CANCELLABLE)
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The winning bidder shall assist the Issuer in establishing the issue price of the Bonds and shall execute
and deliver to the Issuer at closing an “issue price” or similar certificate setting forth the reasonably
expected initial offering price to the public or the sales price or prices of the Bonds, together with the
supporting pricing wires or equivalent communications, substantially in the form attached hereto as
Exhibit A, with such modifications as may be appropriate or necessary, in the reasonable judgment of the
winning bidder, the Issuer and Bond Counsel. All actions to be taken by the Issuer under this Notice of
Sale to establish the issue price of the Bonds may be taken on behalf of the Issuer by the Issuer’s
Municipal Advisor and any notice or report to be provided to the Issuer may be provided to the Issuer’s
Municipal Advisor.
The Issuer intends that the provisions of Treasury Regulation Section 1.148-1(f)(3)(i) (defining
“competitive sale” for purposes of establishing the issue price of the Bonds) will apply to the initial sale
of the Bonds (the “competitive sale requirements”) because:
(1) the Issuer shall disseminate this Notice of Sale to potential underwriters in a manner that is
reasonably designed to reach potential underwriters;
(2) all bidders shall have an equal opportunity to bid;
(3) the Issuer may receive bids from at least three underwriters of municipal bonds who have
established industry reputations for underwriting new issuances of municipal bonds; and
(4) the Issuer anticipates awarding the sale of the Bonds to the bidder who submits a firm offer to
purchase the Bonds at the highest price (or lowest cost), as set forth in this Notice of Sale.
Any bid submitted pursuant to this Notice of Sale shall be considered a firm offer for the purchase
of the Bonds, as specified in the bid.
In the event that the competitive sale requirements are not satisfied, the Issuer shall promptly so advise
the winning bidder. The Issuer may then determine to treat the initial offering price to the public as of the
award date of the Bonds as the issue price of each maturity by imposing on the winning bidder the Hold-
the-Offering-Price Rule as described in the following paragraph (the “Hold-the-Offering-Price Rule”).
Bids will not be subject to cancellation in the event that the Issuer determines to apply the Hold-the-
Offering-Price Rule to the Bonds. Bidders should prepare their bids on the assumption that the
Bonds will be subject to the Hold-the-Offering-Price Rule in order to establish the issue price of the
Bonds.
By submitting a bid, the winning bidder shall (i) confirm that the underwriters have offered or will offer
the Bonds to the public on or before the date of award at the offering price or prices (the “Initial Offering
Price”), or at the corresponding yield or yields, set forth in the bid submitted by the winning bidder and
(ii) agree, on behalf of the underwriters participating in the purchase of the Bonds, that the underwriters
will neither offer nor sell unsold Bonds of any maturity to which the Hold-the-Offering Price Rule shall
apply to any person at a price that is higher than the Initial Offering Price to the public during the period
starting on the award date for the Bonds and ending on the earlier of the following:
(1) the close of the fifth (5th) business day after the award date; or
(2) the date on which the underwriters have sold at least 10% of a maturity of the Bonds to the public
at a price that is no higher than the Initial Offering Price to the public (the “10% Test”), at which
time only that particular maturity will no longer be subject to the Hold-the-Offering-Price Rule.
The Issuer acknowledges that, in making the representations set forth above, the winning bidder will rely
on (i) the agreement of each underwriter to comply with the requirements for establishing issue price of
the Bonds, including, but not limited to, its agreement to comply with the Hold-the-Offering-Price Rule,
if applicable to the Bonds, as set forth in an agreement among underwriters and the related pricing wires,
(ii) in the event a selling group has been created in connection with the initial sale of the Bonds to the
public, the agreement of each dealer who is a member of the selling group to comply with the
requirements for establishing issue price of the Bonds, including but not limited to, its agreement to
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comply with the Hold-the-Offering-Price Rule, if applicable to the Bonds, as set forth in a selling group
agreement and the related pricing wires, and (iii) in the event that an underwriter or dealer who is a
member of the selling group is a party to a third-party distribution agreement that was employed in
connection with the initial sale of the Bonds to the public, the agreement of each broker-dealer that is a
party to such agreement to comply with the requirements for establishing issue price of the Bonds,
including, but not limited to, its agreement to comply with the Hold-the-Offering-Price Rule, if applicable
to the Bonds, as set forth in the third-party distribution agreement and the related pricing wires. The
Issuer further acknowledges that each underwriter shall be solely liable for its failure to comply with its
agreement regarding the requirements for establishing issue price of the Bonds, including but not limited
to, its agreement to comply with the Hold-the-Offering-Price Rule, if applicable to the Bonds, and that no
underwriter shall be liable for the failure of any other underwriter, or of any dealer who is a member of a
selling group, or of any broker-dealer that is a party to a third-party distribution agreement to comply with
its corresponding agreement to comply with the requirements for establishing issue price of the Bonds,
including, but not limited to, its agreement to comply with the Hold-the-Offering-Price Rule if applicable
to the Bonds.
By submitting a bid, each bidder confirms that: (i) any agreement among underwriters, any selling group
agreement and each third-party distribution agreement (to which the bidder is a party) relating to the
initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain
language obligating each underwriter, each dealer who is a member of the selling group, and each broker-
dealer that is a party to such third-party distribution agreement, as applicable, (A) to comply with the
Hold-the-Offering-Price Rule, if applicable if and for so long as directed by the winning bidder and as set
forth in the related pricing wires, (B) to promptly notify the winning bidder of any sales of Bonds that to
its knowledge, are made to a purchaser who is a related party to an underwriter participating in the initial
sale of the Bonds to the public (each such term being used as defined below), and (C) to acknowledge
that, unless otherwise advised by the underwriter, dealer or broker-dealer, the winning bidder shall
assume that each order submitted by the underwriter, dealer or broker-dealer is a sale to the public, and
(ii) any agreement among underwriters or selling group agreement relating to the initial sale of the Bonds
to the public, together with the related pricing wires, contains or will contain language obligating each
underwriter or dealer that is a party to a third-party distribution agreement to be employed in connection
with the initial sale of the Bonds to the public to require each broker-dealer that is a party to such retail
distribution agreement to comply with the Hold-the-Offering-Price Rule, if applicable, in each case if and
for so long as directed by the winning bidder or the underwriter and as set forth in the related pricing
wires.
Notes: Sales of any Bonds to any person that is a related party to an underwriter participating in the
initial sale of the Bonds to the public (each such term being used as defined below) shall not constitute
sales to the public for purposes of this Notice of Sale. Further, for purposes of this Notice of Sale:
(1) “public” means any person other than an underwriter or a related party,
(2) “underwriter” means (A) any person that agrees pursuant to a written contract with the Issuer
(or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale
of the Bonds to the public and (B) any person that agrees pursuant to a written contract directly
or indirectly with a person described in clause (A) to participate in the initial sale of the Bonds to
the public (including a member of a selling group or a party to a third-party distribution
agreement participating in the initial sale of the Bonds to the public).
(3) a purchaser of any of the Bonds is a “related party” to an underwriter if the underwriter and the
purchaser are subject, directly or indirectly, to (A) more than 50% common ownership of the
voting power or the total value of their stock, if both entities are corporations (including direct
ownership by one corporation or another), (B) more than 50% common ownership of their
capital interests or profits interests, if both entities are partnerships (including direct ownership
by one partnership of another), or (C) more than 50% common ownership of the value of the
outstanding stock of the corporation or the capital interests or profit interests of the partnership,
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as applicable, if one entity is a corporation and the other entity is a partnership (including direct
ownership of the applicable stock or interests by one entity of the other), and
(4) “sale date” means the date that the Bonds are awarded by the Issuer to the winning bidder.
ADJUSTMENTS TO PRINCIPAL AMOUNT AFTER PROPOSALS
The Issuer reserves the right to increase or decrease the principal amount of the Bonds. Any such increase
or decrease will be made in multiples of $5,000 and may be made in any maturity. If any maturity is
adjusted, the purchase price will also be adjusted to maintain the same gross spread. Such adjustments
shall be made promptly after the sale and prior to the award of Proposals by the Issuer and shall be at the
sole discretion of the Issuer. The successful bidder may not withdraw or modify its Proposal once
submitted to the Issuer for any reason, including post-sale adjustment. Any adjustment shall be conclusive
and shall be binding upon the successful bidder.
OPTIONAL REDEMPTION
Bonds maturing on and after February 1, 2034 are subject to redemption and prepayment at the option of
the Issuer on February 1, 2033 and any date thereafter, at a price of par plus accrued interest. Redemption
may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the maturities and
principal amounts within each maturity to be redeemed shall be determined by the Issuer and if only part
of the Bonds having a common maturity date are called for prepayment, the specific Bonds to be prepaid
shall be chosen by lot by the Bond Registrar.
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but
neither the failure to print such numbers on any Bond nor any error with respect thereto shall constitute
cause for a failure or refusal by the successful bidder thereof to accept delivery of and pay for the Bonds
in accordance with terms of the purchase contract. The CUSIP Service Bureau charge for the assignment
of CUSIP identification numbers shall be paid by the successful bidder.
DELIVERY
Delivery of the Bonds will be within thirty-five days after award, subject to an approving legal opinion by
Kutak Rock LLP, Bond Counsel. The legal opinion will be paid by the Issuer and delivery will be
anywhere in the continental United States without cost to the successful bidder at DTC.
TYPE OF PROPOSAL
Proposals of not less than $2,157,687.50 (98.75%) and accrued interest on the principal sum of
$2,185,000 must be filed with the undersigned prior to the time of sale. Proposals must be unconditional
except as to legality. Proposals for the Bonds should be delivered to Northland Securities, Inc. and
addressed to:
Clarissa Hadler, Finance Director
3880 Laverne Ave. N.
Lake Elmo, Minnesota 55042
A good faith deposit (the “Deposit”) in the amount of $43,700 in the form of a federal wire transfer
(payable to the order of the Issuer) is only required from the apparent winning bidder, and must be
received within two hours after the time stated for the receipt of Proposals. The apparent winning bidder
will receive notification of the wire instructions from the Municipal Advisor promptly after the sale. If
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the Deposit is not received from the apparent winning bidder in the time allotted, the Issuer may choose to
reject their Proposal and then proceed to offer the Bonds to the next lowest bidder based on the terms of
their original proposal, so long as said bidder wires funds for the Deposit amount within two hours of said
offer.
The Issuer will retain the Deposit of the successful bidder, the amount of which will be deducted at
settlement and no interest will accrue to the successful bidder. In the event the successful bidder fails to
comply with the accepted Proposal, said amount will be retained by the Issuer. No Proposal can be
withdrawn after the time set for receiving Proposals unless the meeting of the Issuer scheduled for award
of the Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been
made.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost
(TIC) basis. The Issuer’s computation of the interest rate of each Proposal, in accordance with customary
practice, will be controlling. In the event of a tie, the sale of the Bonds will be awarded by lot. The Issuer
will reserve the right to: (i) waive non-substantive informalities of any Proposal or of matters relating to
the receipt of Proposals and award of the Bonds, (ii) reject all Proposals without cause, and (iii) reject any
Proposal which the Issuer determines to have failed to comply with the terms herein.
INFORMATION FROM SUCCESSFUL BIDDER
The successful bidder will be required to provide, in a timely manner, certain information relating to the
initial offering price of the Bonds necessary to compute the yield on the Bonds pursuant to the provisions
of the Internal Revenue Code of 1986, as amended.
OFFICIAL STATEMENT
By awarding the Bonds to any underwriter or underwriting syndicate submitting a Proposal therefor, the
Issuer agrees that, no more than seven business days after the date of such award, it shall provide to the
senior managing underwriter of the syndicate to which the Bonds are awarded, the Final Official
Statement in an electronic format as prescribed by the Municipal Securities Rulemaking Board (MSRB).
FULL CONTINUING DISCLOSURE UNDERTAKING
The Issuer will covenant in the resolution awarding the sale of the Bonds and in a Continuing Disclosure
Undertaking to provide, or cause to be provided, annual financial information, including audited financial
statements of the Issuer, and notices of certain material events, as required by SEC Rule 15c2-12.
BANK QUALIFICATION
The Issuer will designate the Bonds as qualified tax-exempt obligations for purposes of Section 265(b)(3)
of the Internal Revenue Code of 1986, as amended.
BOND INSURANCE AT UNDERWRITER’S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment therefor at the
option of the successful bidder, the purchase of any such insurance policy or the issuance of any such
commitment shall be at the sole option and expense of the successful bidder of the Bonds. Any increase in
the costs of issuance of the Bonds resulting from such purchase of insurance shall be paid by the
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successful bidder, except that, if the Issuer has requested and received a rating on the Bonds from a rating
agency, the Issuer will pay that rating fee. Any other rating agency fees shall be the responsibility of the
successful bidder. Failure of the municipal bond insurer to issue the policy after the Bonds have been
awarded to the successful bidder shall not constitute cause for failure or refusal by the successful bidder
to accept delivery on the Bonds.
The Issuer reserves the right to reject any and all Proposals, to waive informalities and to adjourn the sale.
Dated: June 17, 2025 BY ORDER OF THE LAKE ELMO CITY COUNCIL
/s/ Clarissa Hadler
Finance Director
Additional information may be obtained from:
Northland Securities, Inc.
150 South 5th Street, Suite 3300
Minneapolis, Minnesota 55402
Telephone No.: 612-851-5900
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EXHIBIT A
(ISSUE PRICE CERTIFICATE – HOLD THE PRICE)
ISSUE PRICE CERTIFICATE
The undersigned, on behalf of [NAME OF UNDERWRITER] (“[UNDERWRITER]”), hereby
certifies as set forth below with respect to the sale and issuance of the above-captioned obligations (the
“Bonds”).
1. Initial Offering Price of the Bonds.
(a) [UNDERWRITER] offered each Maturity of the Bonds to the Public for purchase at the
respective initial offering prices listed in Schedule A (the “Initial Offering Prices”) on or before the Sale
Date. A copy of the pricing wire or equivalent communication for the Bonds is attached to this certificate
as Schedule B.
(b) As set forth in the Notice of Sale and bid award, [UNDERWRITER] has agreed in
writing that, (i) for each Maturity of the Bonds, it would neither offer nor sell any of the Bonds of such
Maturity to any person at a price that is higher than the Initial Offering Price for such Maturity during the
Holding Period for such Maturity (the “hold-the-offering-price rule”), and (ii) any selling group
agreement shall contain the agreement of each dealer who is a member of the selling group, and any retail
distribution agreement shall contain the agreement of each broker-dealer who is a party to the retail
distribution agreement, to comply with the hold-the-offering-price rule. Pursuant to such agreement, no
Underwriter (as defined below) has offered or sold any Maturity of the Bonds at a price that is higher than
the respective Initial Offering Price for that Maturity of the Bonds during the Holding Period.
2. Defined Terms.
(a) Holding Period means, for each Maturity of the Bonds, the period starting on the Sale
Date and ending on the earlier of (i) the close of the fifth business day after the Sale Date
(____________), or (ii) the date on which [UNDERWRITER] has sold at least 10% of such Maturity of
the Bonds to the Public at prices that are no higher than the Initial Offering Price for such Maturity.
(b) Issuer means the City of Lake Elmo, Minnesota.
(c) Maturity means Bonds with the same credit and payment terms. Bonds with different
maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as
separate Maturities.
(d) Public means any person (including an individual, trust, estate, partnership, association,
company, or corporation) other than an Underwriter or a related party to an Underwriter. The term
“related party” for purposes of this certificate generally means any two or more persons who have greater
than 50 percent common ownership, directly or indirectly.
(e) Sale Date means the first day on which there is a binding contract in writing for the sale
of a Maturity of the Bonds. The Sale Date of the Bonds is ___________.
(f) Underwriter means (i) any person that agrees pursuant to a written contract with the
Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of
the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly
with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the
Public (including a member of a selling group or a party to a retail distribution agreement participating in
the initial sale of the Bonds to the Public).
The representations set forth in this certificate are limited to factual matters only. Nothing in this
certificate represents [UNDERWRITER] interpretation of any laws, including specifically Sections 103
and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder.
The undersigned understands that the foregoing information will be relied upon by the Issuer with respect
to certain of the representations set forth in the Tax Compliance Certificate and with respect to
compliance with the federal income tax rules affecting the Bonds, and by Kutak Rock LLP in connection
with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income
tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax
advice that it may give to the Issuer from time to time relating to the Bonds.
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[UNDERWRITER]
By:______________________________________
Name:___________________________________
Dated: __________, 2025
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(ISSUE PRICE CERTIFICATE – COMPETITIVE SALE SATISFIED)
ISSUE PRICE CERTIFICATE
The undersigned, on behalf of [NAME OF UNDERWRITER] (“[UNDERWRITER]”), hereby
certifies as set forth below with respect to the sale of the above-captioned obligations (the “Bonds”).
1. Reasonably Expected Initial Offering Price.
(a) As of the Sale Date, the reasonably expected initial offering prices of the Bonds to the
Public by [UNDERWRITER] are the prices listed in Schedule A (the “Expected Offering Prices”). The
Expected Offering Prices are the prices for the Maturities of the Bonds used by [SHORT NAME OF
UNDERWRITER] in formulating its bid to purchase the Bonds. Attached as Schedule B is a true and
correct copy of the bid provided by [UNDERWRITER] to purchase the Bonds.
(b) [UNDERWRITER] was not given the opportunity to review other bids prior to
submitting its bid.
(c) The bid submitted by [UNDERWRITER] constituted a firm offer to purchase the Bonds.
2. Defined Terms.
(a) Maturity means Bonds with the same credit and payment terms. Bonds with different
maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as
separate Maturities.
(b) Public means any person (including an individual, trust, estate, partnership, association,
company, or corporation) other than an Underwriter or a related party to an Underwriter. The term
“related party” for purposes of this certificate generally means any two or more persons who have greater
than 50 percent common ownership, directly or indirectly.
(c) Sale Date means the first day on which there is a binding contract in writing for the sale
of a Maturity of the Bonds. The Sale Date of the Bonds is ____________.
(d) Underwriter means (i) any person that agrees pursuant to a written contract with the
Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of
the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly
with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the
Public (including a member of a selling group or a party to a retail distribution agreement participating in
the initial sale of the Bonds to the Public).
The representations set forth in this certificate are limited to factual matters only. Nothing in this
certificate represents [UNDERWRITER]’s interpretation of any laws, including specifically Sections 103
and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder.
The undersigned understands that the foregoing information will be relied upon by the Issuer with respect
to certain of the representations set forth in the Tax Compliance Certificate and with respect to
compliance with the federal income tax rules affecting the Bonds, and by Kutak Rock LLP in connection
with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income
tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax
advice that it may give to the Issuer from time to time relating to the Bonds.
[UNDERWRITER]
By:______________________________________
Name:___________________________________
Dated: ___________, 2025
MUNICIPAL ADVISORY SERVICE AGREEMENT
BY AND BETWEEN
THE CITY OF LAKE ELMO, MINNESOTA
AND
NORTHLAND SECURITIES, INC.
This Agreement is made and entered into by and between the City of Lake Elmo, Minnesota
(hereinafter "Client") and Northland Securities, Inc., of Minneapolis, Minnesota (hereinafter
"Northland").
WITNESSETH
WHEREAS, the Client desires to have Northland provide it with advice on the structure, terms, timing
and other matters related to the issuance of the General Obligation Improvement Bonds, Series 2025A
(the “Debt”) serving in the role of municipal (financial) advisor, and
WHEREAS, Northland is a registered municipal advisor with both the Securities and Exchange
Commission (“SEC”) and the Municipal Securities Rulemaking Board (“MSRB”) (registration # 866-
00082-00), and
WHEREAS, Northland will act as municipal advisor in accordance with the duties and responsibilities
of Rule G-42 of the MSRB, and
WHEREAS, the MSRB provides a municipal advisory client brochure on its website (www.msrb.org)
that describes the protections that may be provided by the MSRB rules, including professional
competency, fair dealing, duty of loyalty, remedies for disputes and how to file a complaint with an
appropriate regulatory authority, and
WHEREAS, the Client and Northland are entering into this Agreement to define the municipal
advisory relationship at the earliest opportunity related to the inception of the municipal advisory
relationship for the Debt, and
WHEREAS, Northland desires to furnish services to the Client as hereinafter described,
NOW, THEREFORE, it is agreed by and between the parties as follows:
SERVICES TO BE PROVIDED BY NORTHLAND
Northland shall provide the Client with services necessary to analyze, structure, offer for sale and close
the Debt. The services will be tailored to meet the needs of this engagement and may include:
Planning and Development
1. Assist Client officials to define the scope and the objectives for the Debt.
2. Investigate and consider reasonably feasible financing alternatives.
3. Assist the Client in understanding the material risks, potential benefits, structure and other
characteristics of the recommended plan for the Debt, including issue structure, estimated debt
Municipal Advisory Service Agreement
2
service payments, projected revenues, method of issuance, bond rating, sale timing, and call
provisions.
4. Prepare a schedule of events related to the issuance process.
5. Coordinate with bond counsel any actions needed to authorize the issuance of the Debt.
6. Attend meetings of the Client and other project and bond issue related meetings as needed and as
requested.
Bond Sale
1. Assist the Client with the preparation, review and approval of the preliminary official statement
(POS).
2. Assist the Client and bond counsel with preparing and publishing the Official Notice of Sale if
required by law.
3. Prepare and submit application for bond rating(s) and assist the Client with furnishing the rating
agency(s) with any additional information required to conduct the rating review. Assist the Client
with preparing and conducting the rating call or other presentation.
4. Assist the Client in receiving the bids, compute the accuracy of the bids received, and recommend
to the Client the most favorable bid for award.
5. Coordinate with bond counsel the preparation of required contracts and resolutions.
Post-Sale Support
1. Assist the Client with the preparation of final official statement, distribution to the underwriter
and posting on EMMA.
2. Coordinate the bond issue closing, including making all arrangements for bond printing,
registration, and delivery.
3. Furnish to the Client a complete transcript of the transaction, if not provided by bond counsel.
There are no specific limitations on the scope of this agreement.
COMPENSATION
For providing these services with respect to the Debt, Northland shall be paid a lump sum of
$31,388.50. The fee due to Northland shall be payable by the Client upon the closing of the Bonds.
Northland agrees to pay the following expenses from its fee:
• Out-of-pocket expenses such as travel, long distance phone, and copy costs.
• Production and distribution of material to rating agencies and/or bond insurance companies.
• Preparation of the bond transcript.
The Client agrees to pay for all other expenses related to the processing of the bond issue(s) including,
but not limited to, the following:
• Engineering and/or architectural fees.
• Publication of legal notices.
• Bond counsel and local attorney fees.
• Fees for various debt certificates.
• The cost of printing Official Statements, if any.
• Client staff expenses.
• Airfare and lodging expenses of one Northland official and Client officials when and if traveling
for rating agency presentations.
• Rating agency fees, if any.
Municipal Advisory Service Agreement
3
• Bond insurance fees, if any.
• Accounting and other related fees.
It is expressly understood that there is no obligation on the part of the Client under the terms of this
Agreement to issue the Debt. If the Debt is not issued, Northland agrees to pay its own expenses and
receive no fee for any municipal advisory services it has rendered pursuant to this Agreement.
CONFLICTS OF INTEREST
Northland, as your Municipal Advisor, mitigates conflicts through its adherence to its fiduciary duty
to the Client, which includes a duty of loyalty to the Client in performing all municipal advisory
activities for the Client. This duty of loyalty obligates Northland to deal honestly and with the utmost
good faith with the Client and to act in the Client’s best interests without regard to our own financial
or other interests. In addition, because Northland is a broker-dealer with significant capital due to the
nature of its overall business, the success and profitability of Northland is not dependent on
maximizing short-term revenue generated from individualized recommendations to its clients but
instead is dependent on long-term profitably built on a foundation of integrity, quality of service and
strict adherence to its fiduciary duty. Furthermore, Northland’s municipal advisory supervisory
structure leverages our long-standing and comprehensive broker-dealer supervisory processes and
practices, and provides strong safeguards against individual representatives of Northland potentially
departing from our regulatory duties due to personal interests. The disclosures below describe, as
applicable, any additional mitigations that may be relevant with respect to any specific conflict
disclosed below.
Northland serves a wide variety of other clients that may from time to time have interests that could
have a direct or indirect impact on the interests of the Client. For example, Northland serves as
Municipal Advisor to other Municipal Advisory clients and, in such cases, owes a regulatory duty to
such other clients just as it does to the Client under this Agreement. These other clients may, from time
to time and depending on the specific circumstances, have competing interests, such as accessing the
new issue market with the most advantageous timing and with limited competition at the time of the
offering. In acting in the interests of its various clients, Northland could potentially face a conflict of
interest arising from these competing client interests. In other cases, as a broker-dealer that engages in
underwritings of new issuances of municipal securities by other municipal entities, the interests of
Northland to achieve a successful and profitable underwriting for its municipal entity underwriting
clients could potentially constitute a conflict of interest if, as in the example above, the municipal
entities that Northland serves as underwriter or municipal advisor have competing interests in seeking
to access the new issue market with the most advantageous timing and with limited competition at
the time of the offering. However, none of these other engagements or relationships would impair
Northland’s ability to fulfill its regulatory duties to the Client.
The compensation for services provided in this Agreement is customary in the municipal securities
market, however, it may pose a conflict of interest. The fees due under this Agreement are in a fixed
amount established at the outset of the Agreement. The amount is usually based upon an analysis by
Client and Northland of, among other things, the expected duration and complexity of the transaction
and the Scope of Services to be performed by Northland. This form of compensation presents a
Municipal Advisory Service Agreement
4
potential conflict of interest because, if the transaction requires more work than originally
contemplated, Northland may suffer a loss. Thus, Northland may recommend less time-consuming
alternatives, or fail to do a thorough analysis of alternatives. This conflict of interest is mitigated by
supervisory policies and procedures to ensure the scope of services within the transaction align with
other comparable engagements. By executing this Agreement, the Client acknowledges and accepts
the potential conflicts of interest posed by the compensation to Northland. Northland does not
participate in any payments to be retained, nor participate in any fee splitting agreements or
arrangements.
Northland is a subsidiary of Northland Capital Holdings, Inc. First National of Nebraska, Inc.
(“FNNI”), is the parent company of Northland Capital Holdings, Inc. and First National Bank of
Omaha.
Under FNNI, Northland and its affiliates are comprised of a securities firm and a commercial bank.
These entities provide investment banking, asset management, financing, financial advisory services
and other commercial and investment banking products and services to a wide range of corporations
and individuals. In addition, Northland and its affiliates currently have, and may in the future have,
investment and commercial banking, trust, and other relationships with parties that may relate to
assets of, or be involved in the issuance of securities and/or instruments by, the Client and its affiliates.
In the ordinary course of their respective businesses, Northland and its affiliates have engaged, and
may in the future engage, in transactions with, and perform services for, the Client and its affiliates for
which they received or will receive customary fees and expenses.
Northland is a broker-dealer that engages in a broad range of securities-related activities to service its
clients, in addition to serving as a Municipal Advisor or Underwriter. Such securities-related activities,
which may include but are not limited to the buying and selling of outstanding securities, including
securities of the Client, may be undertaken on behalf of, or as counterparty to, the Client, and current
or potential investors in the securities of the Client. These other Northland clients may, from time to
time and depending on the specific circumstances, have interests in conflict with those of the Client,
such as when their buying or selling of the Client’s securities may have an adverse effect on the market
for the Client’s securities. However, any potential conflict arising from Northland effecting or
otherwise assisting such other clients in connection with such transactions is mitigated by means of
such activities being engaged in on customary terms through other business units of Northland that
operate independently from Northland’s Municipal Advisory business, thereby reducing or
eliminating the likelihood that the interests of such other clients would have an impact on the services
provided by Northland to the Client under this Agreement. Northland has policies and procedures in
place to ensure that Northland as a broker-dealer or its affiliates are not participating in bidding or
determining market prices for the Client’s transaction that is covered under this Agreement.
Northland Bond Services is a division of First National Bank of Omaha. Northland Bond Services
provides paying agent services to issuers of municipal bonds. The Client is solely responsible for the
decision on the source of paying agent services. Any engagement of Northland Bond Services is
Municipal Advisory Service Agreement
5
outside the scope of this Agreement. No compensation paid to Northland Bond Services is shared with
Northland Securities.
Northland is not aware of any additional material conflicts of interest that could reasonably be
anticipated to impair Northland’s ability to provide advice to or on behalf of the Client in accordance
with the standards of conduct for municipal advisors.
LEGAL AND DISCIPLINARY ACTIONS
The Client can find information about legal or disciplinary events reported by the Securities and
Exchange Commission contained in Form MA or Form MA-I related to Northland at
www.sec.gov/municipal/oms-edgar-links.
SUCCESSORS OR ASSIGNS
The terms and provisions of this Agreement are binding upon and inure to the benefit of the Client
and Northland and their successors or assigns.
TERM OF THIS AGREEMENT
This Agreement may be terminated by thirty (30) days written notice by either the Client or Northland
and it shall terminate sixty (60) days following the closing date related to the issuance of the Debt.
Dated this 17th day of June, 2025.
Northland Securities, Inc.
By:
Tammy Omdal, Managing Director
By:
Craig Jones, Managing Director
City of Lake Elmo, Minnesota
By: _________________________________
Its: _________________________________