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Proposed Issue: <br />$6,140,000 General Obligation Water Revenue Bonds, Series 2020A <br />Purposes: <br />The proposed issue includes financing for costs associated with the City's 2019 and 2020 <br />Water Treatment Plant Rehab Project. The General Obligation Water Revenue Bonds, Series <br />2020A (the "Bonds") debt service will be paid from utility revenues. <br />Authority: <br />The Bonds are being issued pursuant to Minnesota Statutes, Chapters 444 and 475 <br />Chapter 444 allows cities to issue debt without limitation as long as debt service is expected <br />to be paid from water and sewer revenues. <br />The Bonds will be general obligations of the City for which its full faith, credit and taxing <br />powers are pledged. <br />Term/Call Feature: <br />The Bonds are being issued for a term of 15 years. Principal on the Bonds will be due on <br />February 1 in the years 2022 through 2036. Interest is payable every six months beginning <br />August 1, 2021. <br />The Bonds will be subject to prepayment at the discretion of the City on February 1, 2030 or <br />any date thereafter. <br />Bank Qualification: <br />Because the City is not issuing more than $10,000,000 in tax exempt debt during the2020 <br />calendar year, the City will be able to designate the Bonds as "bank qualified" obligations. <br />Bank qualified status broadens the market for the Bonds, which can result in lower interest <br />rates. <br />State Credit Enhancement: <br />City bonds for water, sanitary sewer and storm water facilities are authorized to receive credit <br />enhancement from the State of Minnesota. Under current bond ratings, the state credit <br />enhancement would bring a Standard & Poor's "AAA" rating because the State guarantees the <br />debt service payments on the Bonds. Currently, state credit enhancement provides a <br />significant interest cost savings. <br />Presale Report November 9, 2020 <br />City of Mounds View, Minnesota Page 1 <br />