HomeMy WebLinkAboutRES 16-041 RELATING TO $1,455,000 GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2016A; AWARDING THE SALE, FIXING THE FORM AND DETAILS AND PROVIDING FOR THE EXECUTION AND DELIVERY THEREOF AND SECURTIY THEREFOR AND LEVYING AD VALOREM TAXES FOR THE PAYMENT THCERTIFICATION OF MINUTES RELATING TO
$1,455,000 GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2016A
Issuer: City of St. Anthony, Minnesota
Governing body: City Council
Kind, date, time and place of meeting: A regular meeting held on May 10, 2016,
at 7:00 o'clock P.M., at the City Hall.
Members present:
Members absent:
Documents attached:
Minutes of said meeting (including): Pages I through 17
RESOLUTION 16- QVI
RESOLUTION RELATING TO $1,455,000 GENERAL OBLIGATION
IMPROVEMENT BONDS, SERIES 2016A; AWARDING THE SALE,
FIXING THE FORM AND DETAILS AND PROVIDING FOR THE
EXECUTION AND DELIVERY THEREOF AND SECURITY
THEREFOR AND LEVYING AD VALOREM TAXES FOR THE
PAYMENT THEREOF
I, the undersigned, being the duly qualified and acting recording officer of the public
corporation issuing the obligations referred to in the title of this certificate, certify that the
documents attached hereto, as described above, have been carefully compared with the original
records of the corporation in my legal custody, from which they have been transcribed; that the
documents are a correct and complete transcript of the minutes of a meeting of the governing
body of the corporation, and correct and complete copies of all resolutions and other actions
taken and of all documents approved by the governing body at the meeting, insofar as they relate
to the obligations; and that the meeting was duly held by the governing body at the time and
place and was attended throughout by the members indicated above, pursuant to call and notice
given as required by law.
WITNESS my hand officially as such recording officer this 10th day of May, 2016.
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It was reported that two (2) proposals had been received prior to 12:00 Noon, Central
Time, Tuesday, May 10, 2016, for the purchase of the $1,455,000 General Obligation
Improvement Bonds, Series 2016A of the City in accordance with the Official Statement
distributed by the City to potential purchasers of the Bonds. The proposals have been read and
tabulated, and the terms of each have been determined to be as follows:
Bidder Purchase Price Interest Rates Net Interest Cost
(See Attached)
BID TABULATION
EHLERS
LEADERS IN PUBLIC FINANCE
$1,510,000* General Obligation Improvement Bonds, Series 2016A
City of St. Anthony, Minnesota
SALE: May 10, 2016
AWARD: BAIRD
Rating: Standard & Poor's Credit Markets "AA" BBI: 3.32%
Bank Qualified
NET TRUE
MATURITY REOFFERING INTEREST INTEREST
NAME OF BIDDER (February 1) RATE YIELD PRICE COST RATE
BAIRD
Milwaukee, Wisconsin
2018
2.000%
0.900%
C.L. King & Associates WMBE
2019
2.000%
1.000%
Cronin & Co., Inc.
2020
2.000%
1.100%
Edward Jones
2021
2.000%
1.200%
WNJ Capital
2022
2.000%
1.300%
Crews & Associates, Inc.
2023
2.000%
1.400%
Davenport & Co. L.L.C.
2024
2.000%
1.500%
Duncan - Williams, Inc.
2025
2.000%
1.600%
Ross, Sinclaire & Associates, LLC
2026
2.000%
1.700%
Dougherty & Company, LLC
2027'
2.000%
1.900%
Loop Capital Markets
2028'
2.000%
1.900%
Oppenheimer & Co.
20292
2.250%
2.100%
SumRidge Partners
20302
2.250%
2.100%
R. Seelaus & Company., Inc.
Sierra Pacific Securities
2031
0
2.750%
0
2.300%
Isaak Bond Investments, Inc
2032'
2.750%
2.300%
Alamo Capital WMBE
IFS Securities
Rafferty Capital Markets
W.H. Mel] Associates
Wayne Hummer & Co.
Subsequent to bid opening the issue size was decreased to $1,455,000.
$1,535,957.15 $274,794.55 2.0138%
Adjusted Price - $1,480,000.16 Adjusted Net Interest Cost - $267,400.57 Adjusted TIC - 2.0171 %
'$200,000 Term Bond due 2028 with mandatory redemption in 2027.
'$210,000 Term Bond due 2030 with mandatory redemption in 2029.
'$215,000 Term Bond due 2032 with mandatory redemption in 2031.
NET TRUE
MATURITY REOFFERING INTEREST INTEREST
NAME OF BIDDER (February 1) RATE YIELD PRICE COST RATE
NORTHLAND SECURITIES, INC.
Minneapolis, Minnesota 2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
$1,507,969.50 $282,842.29 2.0889%
0.900%
0.900%
1.150%
1.150%
1.400%
1.400%
1.600%
1.600%
2.000%
2.000%
2.500%
2.500%
2.500%
2.500%
2.500%
Bid Tabulation May 10, 2016
City of St. Anthony, Minnesota
$1,510,000* General Obligation Improvement Bonds, Series 2016A Page 2
Councilmember ly".son then introduced the following resolution
and moved its adoption:
RESOLUTION 16- 04 1
RESOLUTION RELATING TO $1,455,000 GENERAL OBLIGATION
IMPROVEMENT BONDS, SERIES 2016A; AWARDING THE SALE,
FIXING THE FORM AND DETAILS AND PROVIDING FOR THE
EXECUTION AND DELIVERY THEREOF AND SECURITY
THEREFOR AND LEVYING AD VALOREM TAXES FOR THE
PAYMENT THEREOF
BE IT RESOLVED by the City Council of the City of St. Anthony, Minnesota (the
"City "), as follows:
Section 1. Recitals Authorization and Sale of Bonds.
1.01. Authorization. This Council has previously determined to issue and sell on the
date hereof its $1,455,000 General Obligation Improvement Bonds, Series 2016A (the Bonds),
pursuant to Minnesota Statutes, Chapters 429 and 475. Proceeds of the Bonds will be used to
finance various road reconstruction projects in the City (the "Improvements ").
1.02. Sale of Bonds. The City has received two (2) proposals for the purchase of the
Bonds. The most favorable proposal received is that of Robert W. Baird & Co. Incorporated, of
Milwaukee, Wisconsin (the "Purchaser "), to purchase the Bonds at a price of $1,480,000.16, the
Bonds to bear interest at the rates set forth in Section 3.01 hereof and to be subject to the further
terms and conditions set forth in this Resolution. The proposal is hereby accepted, and the
Mayor and the City Manager are hereby authorized and directed to execute a contract on the part
of the City for the sale of the Bonds with the Purchaser. The good faith checks of the
unsuccessful bidders shall be returned forthwith.
1.03. Performance of Requirements. All acts, conditions and things which are required
by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be
performed precedent to and in the valid issuance of the Bonds having been done, existing, having
happened and having been performed, it is now necessary for this Council to establish the form
and terms of the Bonds, to provide security therefor and to issue the Bonds forthwith.
1.04. Maturities of Bonds. The Council hereby finds that the maturities of the Bonds as
set forth in Section 3.01 hereof are warranted by the anticipated collections of special
assessments and ad valorem taxes levied and to be levied for the payment of the Bonds as
provided in Section 4 hereof.
Section 2. Form of Bonds. The Bonds shall be prepared in substantially the form
attached as Exhibit A hereto.
Section 3. Bond Terms, Execution and Delivery.
3.01. Maturities, Interest Rates, Denominations, Payment, Dating of Bonds. The City
shall forthwith issue and deliver the Bonds, which shall be denominated "General Obligation
Improvement Bonds, Series 2016A" and shall be payable primarily from the 2016A
Improvement Bond Fund of the City created in Section 4.02. The Bonds shall be dated as of
June 2, 2016, shall be issuable in the denominations of $5,000 or any integral multiple thereof,
shall mature on February 1 in the years and amounts set forth below, and Bonds maturing in such
years and amounts shall bear interest, computed on the basis of a 360 -day year consisting of
twelve 30 -day months, from June 2, 2016 until paid or duly called for redemption at the rates per
annum set forth opposite such years and amounts, respectively:
Year
Amount
Rate
Year
Amount
Rate
2018
$85,000
2.00%
2024
$ 95,000
2.00%
2019
90,000
2.00
2025
95,000
2.00
2020
90,000
2.00
2026
100,000
2.00
2021
90,000
2.00
2028
200,000
2.00
2022
90,000
2.00
2030
210,000
2.25
2023
95,000
2.00
2032
215,000
2.75
The Bonds shall be issuable only in fully registered form, of single maturities. The
interest thereon and, upon surrender of each Bond at the principal office of the Registrar
described herein, the principal amount thereof, shall be payable by check or draft issued by the
Registrar. Each Bond shall be dated by the Registrar as of the date of its authentication.
3.02. Interest Payment Dates. Interest on the Bonds shall be payable on February 1 and
August 1 in each year, commencing February 1, 2017, to the owners thereof as such appear of
record in the bond register as of the close of business on the fifteenth day of the immediately
preceding month, whether or not such day is a business day.
3.03. Registration. The City shall appoint, and shall maintain, a bond registrar, transfer
agent and paying agent (the "Registrar "). The effect of registration and the rights and duties of
the City and the Registrar with respect thereto shall be as follows:
(a) Register. The Registrar shall keep at its principal office a bond register in
which the Registrar shall provide for the registration of ownership of Bonds and the
registration of transfers and exchanges of Bonds entitled to be registered, transferred or
exchanged.
(b) Transfer of Bonds. Upon surrender to the Registrar for transfer of any Bond
duly endorsed by the registered owner thereof or accompanied by a written instrument of
transfer, in form satisfactory to the Registrar, duly executed by the registered owner
thereof or by an attorney duly authorized by the registered owner in writing, the Registrar
shall authenticate and deliver, in the name of the designated transferee or transferees, one
or more new Bonds of a like aggregate principal amount and maturity, as requested by
the transferor. The Registrar may, however, close the books for registration of any
transfer after the fifteenth day of the month preceding each interest payment date and
until such interest payment date.
(c) Exchange of Bonds. Whenever any Bond is surrendered by the registered
owner for exchange, the Registrar shall authenticate and deliver one or more new Bonds
of a like aggregate principal amount, interest rate and maturity, as requested by the
registered owner or the owner's attorney duly authorized in writing.
(d) Cancellation. All Bonds surrendered upon any transfer or exchange shall be
promptly cancelled by the Registrar and thereafter disposed of as directed by the City.
(e) Improper or Unauthorized Transfer. When any Bond is presented to the
Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that
the endorsement on such Bond or separate instrument of transfer is valid and genuine and
that the requested transfer is legally authorized. The Registrar shall incur no liability for
its refusal, in good faith, to make transfers which it, in its judgment, deems improper or
unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the person in
whose name any Bond is at any time registered in the bond register as the absolute owner
of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving
payment of, or on account of, the principal of and interest on such Bond and for all other
purposes, and all such payments so made to any such registered owner or upon the
owner's order shall be valid and effectual to satisfy and discharge the liability of the City
upon such Bond to the extent of the sum or sums so paid.
(g) Taxes, Fees and Charges. For every transfer or exchange of Bonds (except
for an exchange upon a partial redemption of a Bond), the Registrar may impose a charge
upon the owner thereof sufficient to reimburse the Registrar for any tax, fee or other
governmental charge required to be paid with respect to such transfer or exchange.
(h) Mutilated Lost Stolen or Destroyed Bonds. In case any Bond shall become
mutilated or be lost, stolen or destroyed, the Registrar shall deliver a new Bond of like
amount, number, interest rate, maturity date and tenor in exchange and substitution for
and upon cancellation of any such mutilated Bond or in lieu of and in substitution for any
such Bond lost, stolen or destroyed, upon the payment of the reasonable expenses and
charges of the Registrar in connection therewith; and, in the case of a Bond lost, stolen or
destroyed, upon receipt by the Registrar of evidence satisfactory to it that such Bond was
lost, stolen or destroyed, and of the ownership thereof, and upon receipt by the Registrar
of an appropriate bond or indemnity in form, substance and amount satisfactory to it, in
which both the City and the Registrar shall be named as obligees. All Bonds so
surrendered to the Registrar shall be cancelled by it and evidence of such cancellation
shall be given to the City. If the mutilated, lost, stolen or destroyed Bond has already
matured or been called for redemption in accordance with its terms, it shall not be
necessary to issue a new Bond prior to payment.
(i) Authenticating Agent. The Registrar is hereby designated authenticating
agent for the Bonds, within the meaning of Minnesota Statutes, Section 475.55,
Subdivision 1.
3.04. Appointment of Initial Re ig strar. The City hereby appoints Bond Trust Services
Corporation in Roseville, Minnesota, as the initial Registrar. The Mayor and City Manager are
authorized to execute and deliver, on behalf of the City, a contract with Bond Trust Services
Corporation, as Registrar. Upon merger or consolidation of the Registrar with another
corporation, if the resulting corporation is a bank or trust company authorized by law to conduct
such business, such corporation shall be authorized to act as successor Registrar. The City
agrees to pay the reasonable and customary charges of the Registrar for the services performed.
The City reserves the right to remove any Registrar upon thirty (30) days' notice and upon the
appointment of a successor Registrar, in which event the predecessor Registrar shall deliver all
cash and Bonds in its possession to the successor Registrar. On or before each principal or
interest due date, without further order of this Council, the Finance Director shall transmit to the
Registrar from the 2016A Improvement Bond Fund described in Section 4.02 hereof, moneys
sufficient for the payment of all principal and interest then due.
3.05. Redemption. (a) Bonds maturing in 2027 and later years are each subject to
redemption, at the option of the City and in whole or in part, and if in part, in the maturities
selected by the City and, within any maturity, in $5,000 principal amounts selected by the
Registrar by lot, on February 1, 2026 and on any date thereafter, at a redemption price equal to
the principal amount thereof to be redeemed plus accrued interest to the date of redemption.
(b) Bonds maturing in the year 2028 shall be subject to mandatory sinking fund
redemption by lot at a redemption price equal to the principal amount of the Bonds to be so
redeemed plus interest accrued thereon to the date fixed for redemption, on February 1, in the
years and principal amounts set forth below:
Year Amount
2027 $100,000
2028* 100,000
*Final Maturity
In the event that any Bonds maturing in the year 2028 are redeemed pursuant to (a) above by the
City and canceled by the Registrar and not reissued, the Bonds maturing in the year 2028 so
redeemed and canceled may be applied by the City as a credit against the Bonds to be redeemed
pursuant to this subsection (b), such credit to be equal to the principal amount of the Bonds
maturing in the year 2028 so redeemed or canceled provided that the City has notified the
Registrar not less than thirty -five (35) days prior to the redemption date of its election to apply
such Bonds as a credit.
(c) Bonds maturing in the year 2030 shall be subject to mandatory sinking fund
redemption by lot at a redemption price equal to the principal amount of the Bonds to be so
0
redeemed plus interest accrued thereon to the date fixed for redemption, on February 1, in the
years and principal amounts set forth below:
Year Amount
2029 $105,000
2030* 105,000
*Final Maturity
In the event that any Bonds maturing in the year 2030 are redeemed pursuant to (a) above by the
City and canceled by the Registrar and not reissued, the Bonds maturing in the year 2030 so
redeemed and canceled may be applied by the City as a credit against the Bonds to be redeemed
pursuant to this subsection (c), such credit to be equal to the principal amount of the Bonds
maturing in the year 2030 so redeemed or canceled provided that the City has notified the
Register not less than thirty -five (35) days prior to the redemption date of its election to apply
such Bonds as a credit.
(d) Bonds maturing in the year 2032 shall be subject to mandatory sinking fund
redemption by lot at a redemption price equal to the principal amount of the Bonds to be so
redeemed plus interest accrued thereon to the date fixed for redemption, on February 1, in the
years and principal amounts set forth below:
Year Amount
2031 $105,000
2032* 110,000
*Final Maturity
In the event that any Bonds maturing in the year 2032 are redeemed pursuant to (a) above by the
City and canceled by the Registrar and not reissued, the Bonds maturing in the year 2032 so
redeemed and canceled may be applied by the City as a credit against the Bonds to be redeemed
pursuant to this subsection (c), such credit to be equal to the principal amount of the Bonds
maturing in the year 2032 so redeemed or canceled provided that the City has notified the
Register not less than thirty -five (35) days prior to the redemption date of its election to apply
such Bonds as a credit.
(e) At least thirty days prior to the date set for redemption of any Bond, the City shall
cause notice of the call for redemption to be mailed to the Registrar and to the registered owner
of each Bond to be redeemed, but no defect in or failure to give such mailed notice of
redemption shall affect the validity of proceedings for the redemption of any Bond not affected
by such defect or failure. The notice of redemption shall specify the redemption date,
redemption price, the numbers, interest rates and CUSIP numbers of the Bonds to be redeemed
and the place at which the Bonds are to be surrendered for payment, which is the principal office
of the Registrar. Official notice of redemption having been given as aforesaid, the Bonds or
portions thereof so to be redeemed shall, on the redemption date, become due and payable at the
redemption price therein specified and from and after such date (unless the City shall default in
the payment of the redemption price) such Bonds or portions thereof shall cease to bear interest.
Bonds in a denomination larger than $5,000 may be redeemed in part in any integral
multiple of $5,000. The owner of any Bond redeemed in part shall receive without charge, upon
surrender of such Bond to the Registrar, one or more new Bonds in authorized denominations
equal in principal amount to be unredeemed portion of the Bond so surrendered.
3.06. Preparation and Delivery. The Bonds shall be prepared under the direction of the
City Manager and shall be executed on behalf of the City by the signatures of the Mayor and the
City Manager, provided that said signatures may be printed, engraved, or lithographed facsimiles
thereof. In case any officer whose signature, or a facsimile of whose signature, shall appear on
the Bonds shall cease to be such officer before the delivery of any Bond, such signature or
facsimile shall nevertheless be valid and sufficient for all purposes, the same as if such officer
had remained in office until delivery. Notwithstanding such execution, no Bond shall be valid or
obligatory for any purpose or entitled to any security or benefit under this Resolution unless and
until a certificate of authentication on such Bond has been duly executed by the manual signature
of an authorized representative of the Registrar. Certificates of authentication on different Bonds
need not be signed by the same representative. The executed certificate of authentication on
each Bond shall be conclusive evidence that it has been authenticated and delivered under this
Resolution. When the Bonds have been so executed and authenticated, they shall be delivered
by the City Manager to the Purchaser upon payment of the purchase price in accordance with the
contract of sale heretofore made and executed, and the Purchaser shall not be obligated to see to
the application of the purchase price.
3.07. Securities Depository. (a) For purposes of this Section the following terms shall
have the following meanings:
"Beneficial Owner" shall mean, whenever used with respect to a Bond, the person in
whose name such Bond is recorded as the beneficial owner of such Bond by a Participant on the
records of such Participant, or such person's subrogee.
"Cede & Co." shall mean Cede & Co., the nominee of DTC, and any successor nominee
of DTC with respect to the Bonds.
"DTC" shall mean The Depository Trust Company of New York, New York.
"Participant" shall mean any broker - dealer, bank or other financial institution for which
DTC holds Bonds as securities depository.
"Representation Letter" shall mean the Representation Letter from the City to DTC with
respect to the procedures of DTC presently on file with DTC.
(b) The Bonds shall be initially issued as separately authenticated fully registered bonds,
and one Bond shall be issued in the principal amount of each stated maturity of the Bonds. Upon
initial issuance, the ownership of such Bonds shall be registered in the bond register in the name
of Cede & Co., as nominee of DTC. The Registrar and the City may treat DTC (or its nominee)
as the sole and exclusive owner of the Bonds registered in its name for the purposes of payment
of the principal of or interest on the Bonds, selecting the Bonds or portions thereof to be
redeemed, if any, giving any notice permitted or required to be given to registered owners of
Bonds under this resolution, registering the transfer of Bonds, and for all other purposes
whatsoever; and neither the Registrar nor the City shall be affected by any notice to the contrary.
Neither the Registrar nor the City shall have any responsibility or obligation to any Participant,
any person claiming a beneficial ownership interest in the Bonds under or through DTC or any
Participant, or any other person which is not shown on the bond register as being a registered
owner of any Bonds, with respect to the accuracy of any records maintained by DTC or any
Participant, with respect to the payment by DTC or any Participant of any amount with respect to
the principal of or interest on the Bonds, with respect to any notice which is permitted or
required to be given to owners of Bonds under this resolution, with respect to the selection by
DTC or any Participant of any person to receive payment in the event of a partial redemption of
the Bonds, or with respect to any consent given or other action taken by DTC as registered owner
of the Bonds. So long as any Bond is registered in the name of Cede & Co., as nominee of DTC,
the Registrar shall pay all principal of and interest on such Bond, and shall give all notices with
respect to such Bond, only to Cede & Co. in accordance with the Representation Letter, and all
such payments shall be valid and effective to fully satisfy and discharge the City's obligations
with respect to the principal of and interest on the Bonds to the extent of the sum or sums so
paid. No person other than DTC shall receive an authenticated Bond for each separate stated
maturity evidencing the obligation of the City to make payments of principal and interest. Upon
delivery by DTC to the Registrar of written notice to the effect that DTC has determined to
substitute a new nominee in place of Cede & Co., the Bonds will be transferable to such new
nominee in accordance with paragraph (d) hereof.
(c) In the event the City determines that it is in the best interest of the Beneficial Owners
that they be able to obtain Bonds in the form of bond certificates, the City may notify DTC and
the Registrar, whereupon DTC shall notify the Participants of the availability through DTC of
Bonds in the form of certificates. In such event, the Bonds will be transferable in accordance
with paragraph (d) hereof. DTC may determine to discontinue providing its services with
respect to the Bonds at any time by giving notice to the City and the Registrar and discharging its
responsibilities with respect thereto under applicable law. In such event the Bonds will be
transferable in accordance with paragraph (d) hereof.
(d) In the event that any transfer or exchange of Bonds is permitted under paragraph (b)
or (c) hereof, such transfer or exchange shall be accomplished upon receipt by the Registrar of
the Bonds to be transferred or exchanged and appropriate instruments of transfer to the permitted
transferee in accordance with the provisions of this resolution. In the event Bonds in the form of
certificates are issued to owners other than Cede & Co., its successor as nominee for DTC as
owner of all the Bonds, or another securities depository as owner of all the Bonds, the provisions
of this resolution shall also apply to all matters relating thereto, including, without limitation, the
printing of such Bonds in the form of bond certificates and the method of payment of principal of
and interest on such Bonds in the form of bond certificates.
7
Section 4. Security Provisions.
4.01. 2016A Improvement Construction Fund. There is hereby created a special
bookkeeping fund to be designated as the "2016A Improvement Construction Fund" (the
"Construction Fund "), to be held and administered by the Finance Director separate and apart
from all other funds of the City. The City appropriates to the Construction Fund (a)
$1,480,000.16 of the proceeds of the sale of the Bonds, and (b) all collections of special
assessments levied for the Improvements until completion and payment of all costs of the
Improvements. The Construction Fund shall be used solely to defray expenses of the
Improvements, including but not limited to the transfer to the Bond Fund, created in Section 4.02
hereof, of amounts sufficient for the payment of interest and principal, if any, due upon the
Bonds prior to the completion and payment of all costs of the Improvements and the payment of
the expenses incurred by the City in connection with the issuance of the Bonds. Upon
completion and payment of all costs of the Improvements, any balance of the proceeds of Bonds
remaining in the Construction Fund may be used to pay the cost, in whole or in part, of any other
improvements instituted pursuant to the Act, as directed by the City Council, but any balance of
such proceeds not so used shall be credited and paid to the Bond Fund.
4.02. 2016A Improvement Bond Fund. So long as any of the Bonds are outstanding and
any principal of or interest thereon unpaid, the Finance Director shall maintain a separate and
special bookkeeping fund designated "2016A Improvement Bond Fund" (the "Bond Fund ") to be
used for no purpose other than the payment of the principal of and interest on the Bonds and on
such other improvement bonds of the City as have been or may be directed to be paid therefrom.
The City irrevocably appropriates to the Bond Fund (a) the collections of special assessments
and other funds to be credited and paid thereto in accordance with the provisions of Section 4.01,
(b) any taxes levied in accordance with this resolution, and (c) all such other moneys as shall be
received and appropriated to the Bond Fund from time to time. If the balance in the Bond Fund
is at any time insufficient to pay all interest and principal then due on all bonds payable
therefrom, the payment shall be made from any fund of the City which is available for that
purpose, subject to reimbursement from the Bond Fund when the balance therein is sufficient,
and the Council covenants and agrees that it will each year levy a sufficient amount to take care
of any accumulated or anticipated deficiency, which levy is not subject to any constitutional or
statutory tax limitation.
There are hereby established two accounts in the Bond Fund, designated as the "Debt
Service Account' and the "Surplus Account." All money appropriated or to be deposited in the
Bond Fund shall be deposited as received into the Debt Service Account. On each February 1,
the Finance Director shall determine the amount on hand in the Debt Service Account. If such
amount is in excess of one - twelfth of the debt service payable from the Bond Fund in the
immediately preceding 12 months, the Finance Director shall promptly transfer the amount in
excess to the Surplus Account. The City appropriates to the Surplus Account any amounts to be
transferred thereto from the Debt Service Account as herein provided and all income derived
from the investment of amounts on hand in the Surplus Account. If at any time the amount on
hand in the Debt Service Account is insufficient to meet the requirements of the Bond Fund, the
Finance Director shall transfer to the Debt Service Account amounts on hand in the Surplus
Account to the extent necessary to cure such deficiency.
4.03. Additional Bonds. The City reserves the right to issue additional bonds payable
from the Bond Fund as may be required to finance costs of the Improvements not financed
hereby, provided that the City Council shall, prior to the delivery of such additional bonds, levy
or agree to levy by resolution sufficient additional special assessments and ad valorem taxes, if
any, which, together with other moneys or revenues pledged for the payment of said additional
obligations, will produce revenues at least five percent (5 %) in excess of the amount needed to
pay when due the principal and interest on all bonds payable from the Bond Fund. The
additional special assessments, ad valorem taxes and moneys or revenues so pledged, levied or
agreed to be levied shall be irrevocably appropriated to the Bond Fund in the manner provided
by Minnesota Statutes, Section 475.61.
4.04. Levy of Special Assessments. The City hereby covenants and agrees that for
payment of the cost of each of the Improvements it will do and perform all acts and things
necessary for the full and valid levy of special assessments against all assessable lots, tracts and
parcels of land benefited thereby and located within the area proposed to be assessed therefor,
based upon the benefits received by each such lot, tract or parcel, in an aggregate principal
amount not less than twenty percent (20 %) of the cost of the Improvements. In the event that
any such assessment shall be at any time held invalid with respect to any lot, piece or parcel of
land, due to any error, defect or irregularity in any action or proceeding taken or to be taken by
the City or this Council or any of the City's officers or employees, either in the making of such
assessment or in the performance of any condition precedent thereto, the City and this Council
hereby covenant and agree that they will forthwith do all such further acts and take all such
further proceedings as may be required by law to make such assessments a valid and binding lien
upon such property. The Council presently estimates that the special assessments shall be in the
aggregate principal amount of $303,464 payable in not more than 15 installments, the first
installment to be collectible with taxes during the year 2017, and that deferred installments shall
bear interest at the rate provided in the proceedings therefor from the date of the resolution
levying said assessment until December 31 of the year in which the installment is payable.
4.05. Ad Valorem Taxes. The full faith and credit and taxing powers of the City are
irrevocably pledged for the prompt and full payment of the principal of and interest in the Bonds
as the same become respectively due. For the purpose there is hereby levied upon all of the
taxable property of the City a direct, annual ad valorem tax, which shall be spread upon the tax
rolls prepared in each of the following years and collected with other taxes in the following years
and amounts as follows:
0
Levy Year
Collection Year
Amount
2017
2018
$102,173.22
2018
2019
106,135.12
2019
2020
104,742.02
2020
2021
103,348.94
2021
2022
101,955.84
2022
2023
105,812.74
2023
2024
104,314.64
2024
2025
102,816.54
2025
2026
106,568.46
2026
2027
104,965.36
2027
2028
103,362.26
2028
2028
107,009.16
2028
2030
105,025.43
2030
2031
103,041.73
2031
2032
105,756.75
The foregoing tax levies together with special assessments are such that if collected in full they
will produce at least five percent (5 %) in excess of the amount needed to pay when due the
principal of and interest on the Bonds. This tax shall be irrevocably appropriated to the Bond
Fund as long as any of the Bonds are outstanding and unpaid, provided that the City reserves the
right and power to reduce the levies in the manner and to the extent permitted by Minnesota
Statutes, Section 475.61.
4.06. Full Faith and Credit Pledged. The full faith and credit of the City are irrevocably
pledged for the prompt and full payment of the principal of and the interest on the Bonds, and the
Bonds shall be payable from the Bond Fund in accordance with the provisions and covenants
contained in this resolution. It is estimated that the special assessments and ad valorem taxes
levied and to be levied for the payment of the Improvements will be collected in amounts not
less than five percent (5 %) in excess of the annual principal and interest requirements of the
Bonds. If the money on hand in the Bond Fund should at any time be insufficient for the
payment of principal and interest then due, this City shall pay the principal and interest out of
any fund of the City, and such other fund or funds shall be reimbursed therefor when sufficient
money is available to the Bond Fund. If on February 1 in any year the sum of the balance in the
Bond Fund plus the amount of taxes and special assessments theretofore levied for the
Improvements and collectible through the end of the following calendar year is not sufficient to
pay when due all principal and interest become due on all Bonds payable therefrom in said
following calendar year, or the Bond Fund has incurred a deficiency in the manner provided in
this Section 4.06, a direct, irrepealable, ad valorem tax shall be levied on all taxable property
within the corporate limits of the City for the purpose of restoring such accumulated or
anticipated deficiency in accordance with the provisions of this resolution.
Section 5. Defeasance. When any Bond has been discharged as provided in this Section
5, all pledges, covenants and other rights granted by this resolution to the holders of such Bonds
shall cease, and such Bonds shall no longer be deemed outstanding under this Resolution. The
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City may discharge its obligations with respect to any Bond which is due on any date by
irrevocably depositing with the Registrar on or before that date a sum sufficient for the payment
thereof in full; or, if any Bond should not be paid when due, the City may nevertheless discharge
its obligations with respect thereto by depositing with the Registrar a sum sufficient for the
payment thereof in full with interest accrued to the date of such deposit. The City may also
discharge its obligations with respect to any prepayable Bond called for redemption on any date
when it is prepayable according to their terms, by depositing with the Registrar on or before that
date a sum sufficient for the payment thereof in full, provided that notice of the redemption
thereof has been duly given as provided in Section 3.05. The City may also at any time
discharge its obligations with respect to any Bonds, subject to the provisions of law now or
hereafter authorizing and regulating such action, by depositing irrevocably in escrow, with a
bank or trust company qualified by law as an escrow agent for this purpose, cash or securities
which are authorized by law to be so deposited, bearing interest payable at such times and at
such rates and maturing on such dates as shall be required, without reinvestment, to pay all
principal and interest to become due thereon to maturity or, if notice of redemption as herein
required has been duly provided for, to such earlier redemption date.
Section 6. County Auditor Registration, Certification of Proceedings, Investment of
Money, Arbitrage and Official Statement.
6.01. County Auditor Registration. The City Clerk is hereby authorized and directed to
file a certified copy of this Resolution with the County Auditors of Hennepin and Ramsey
Counties, together with such other information as the County Auditors shall require, and to
obtain from each County Auditor a certificate that the Bonds have been entered on his bond
register and the taxes described in Section 4.05 hereof have been levied as required by law.
6.02. Certification of Proceedings. The officers of the City and the County Auditors of
Hennepin and Ramsey Counties are hereby authorized and directed to prepare and furnish to the
Purchaser and to Dorsey & Whitney LLP, Bond Counsel to the City, certified copies of all
proceedings and records of the City, and such other affidavits, certificates and information as
may be required to show the facts relating to the legality and marketability of the Bonds as the
same appear from the books and records under their custody and control or as otherwise known
to them, and all such certified copies, certificates and affidavits, including any heretofore
furnished, shall be deemed representations of the City as to the facts recited therein.
6.03. Covenant. The City covenants and agrees with the holders from time to time of the
Bonds that it will not take or permit to be taken by any of its officers, employees or agents any
action which would cause the interest on the Bonds to become subject to taxation under the
Internal Revenue Code of 1986, as amended (the "Code "), and Regulations promulgated
thereunder (the "Regulations "), as such are enacted or promulgated and in effect on the date of
issue of the Bonds, and covenants to take any and all actions within its powers to ensure that the
interest on the Bonds will not become subject to taxation under such Code and Regulations. The
Improvements are public improvements available for use by members of the general public on a
substantially equal basis. The City will not enter into any lease, use agreement or other contract
respecting the Improvements which would cause the Bonds to be considered "private activity
bonds" or "private loan bonds" pursuant to Section 141 of the Code.
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6.04. Arbitrage Rebate. The City shall take such actions as are required to comply with
the arbitrage rebate requirements of paragraphs (2) and (3) of Section 148(f) of the Code.
6.05. Investment of Money on Deposit in the Bond Fund. The Finance Director shall
ascertain monthly the amount on deposit in the Bond Fund. If the amount on deposit therein ever
exceeds the aggregate amount of principal and interest due and payable from the Bond Fund
through the next following February 1 plus a reasonable carryover as permitted by the
Regulations, such excess shall be used to prepay and redeem Bonds or be invested at a yield less
than or equal to the yield on the Bonds, based upon their amounts, maturities and interest rates
on their date of issue, computed by the actuarial method. The City reserves the right to amend
the provisions of this Section at any time, whether prior to or after the delivery of the Bonds, if
and to the extent that this Council determines that the provisions of this Section are not necessary
in order to ensure that the Bonds are not "arbitrage bonds" within the meaning of Section 148 of
the Code and Regulations.
6.06. Arbitrage Certification. The Mayor and the City Manager, being the officers of the
City charged with the responsibility for issuing the Bonds pursuant to this resolution, are
authorized and directed to execute and deliver to the Purchaser a certification in accordance with
the provisions of Section 148 of the Code, and the Regulations, stating the facts, estimates and
circumstances in existence on the date of issue and delivery of the Bonds which make it
reasonable to expect that the proceeds of the Bonds will not be used in a manner that would
cause the Bonds to be arbitrage bonds within the meaning of the Code and Regulations.
6.07. Qualified Tax - Exempt Obligations. The City hereby designates the Bonds as
"qualified tax — exempt obligations" for purposes of Section 265(b) of the Code relating to the
disallowance of interest expenses for financial institutions. The City represents that in calendar
year 2016 it does not reasonably expect to issue tax —exempt obligations which are not private
activity bonds (not treating qualified 501(c)(3) bonds under Section 145 of the Code as private
activity bonds for purposes of this representation) in an amount in excess of $10,000,000.
6.08. Official Statement. The Official Statement relating to the Bonds, dated April 28,
2016, prepared and distributed on behalf of the City by Ehlers & Associates, Inc., is hereby
approved. Ehlers & Associates, Inc., is hereby authorized on behalf of the City to prepare and
distribute to the Purchaser a supplement to the Official Statement listing the offering price, the
interest rates, other information relating to the Bonds required to be included in the Official
Statement by Rule 15c2 -12 adopted by the Securities and Exchange Commission under the
Securities Exchange Act of 1934. Within seven business days from the date hereof, the City
shall deliver to the Purchaser 30 copies of the Official Statement and such supplement. The
officers of the City are hereby authorized and directed to execute such certificates as may be
appropriate concerning the accuracy, completeness and sufficiency of the Official Statement.
The officers of the City are hereby authorized and directed to execute such certificates as may be
appropriate concerning the accuracy, completeness and sufficiency of the Official Statement.
6.09. Reimbursement. The City certifies that the proceeds of the Bonds will not be used
by the City to reimburse itself for any expenditure with respect to the Improvements which the
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City paid or will have paid more than 60 days prior to the issuance of the Bonds unless, with
respect to such prior expenditures, the City shall have made a declaration of official intent which
complies with the provisions of Section 1.150 -2 of the Regulations; provided that this
certification shall not apply (i) with respect to certain de minimis expenditures, if any, with
respect to the Improvements meeting the requirements of Section 1.150- 2(f)(1) of the
Regulations, or (ii) with respect to "preliminary expenditures" for the Improvements as defined
in Section 1.150- 2(f)(2) of the Regulations, including engineering or architectural expenses and
similar preparatory expenses, which in the aggregate do not exceed 20% of the "issue price" of
the Bonds.
Section 7. Continuing. Disclosure. (a) Purpose and Beneficiaries. To provide for the
public availability of certain information relating to the Bonds and the security therefor and to
permit the Purchaser and other participating underwriters in the primary offering of the Bonds to
comply with amendments to Rule 15c2 -12 promulgated by the SEC under the Securities
Exchange Act of 1934 (17 C.F.R. § 240.15c2 -12), relating to continuing disclosure (as in effect
and interpreted from time to time, the Rule), which will enhance the marketability of the Bonds,
the City hereby makes the following covenants and agreements for the benefit of the Owners (as
hereinafter defined) from time to time of the Outstanding Bonds. The City is the only obligated
person in respect of the Bonds within the meaning of the Rule for purposes of identifying the
entities in respect of which continuing disclosure must be made. If the City fails to comply with
any provisions of this section, any person aggrieved thereby, including the Owners of any
Outstanding Bonds, may take whatever action at law or in equity may appear necessary or
appropriate to enforce performance and observance of any agreement or covenant contained in
this section, including an action for a writ of mandamus or specific performance. Direct,
indirect, consequential and punitive damages shall not be recoverable for any default hereunder
to the extent permitted by law. Notwithstanding anything to the contrary contained herein, in no
event shall a default under this section constitute a default under the Bonds or under any other
provision of this resolution. As used in this section, Owner or Bondowner means, in respect of a
Bond, the registered owner or owners thereof appearing in the bond register maintained by the
Registrar or any Beneficial Owner (as hereinafter defined) thereof, if such Beneficial Owner
provides to the Registrar evidence of such beneficial ownership in form and substance
reasonably satisfactory to the Registrar. As used herein, Beneficial Owner means, in respect of a
Bond, any person or entity which (i) has the power, directly or indirectly, to vote or consent with
respect to, or to dispose of ownership of, such Bond (including persons or entities holding Bonds
through nominees, depositories or other intermediaries), or (ii) is treated as the owner of the
Bond for federal income tax purposes.
(b) Information To Be Disclosed. The City will provide, in the manner set forth in
subsection (c) hereof, either directly or indirectly through an agent designated by the City, the
following information at the following times:
(1) on or before 12 months after the end of each fiscal year of the City, commencing with
the fiscal year ending December 31, 2015, the following financial information and
operating data in respect of the City (the Disclosure Information):
(A) the audited financial statements of the City for such fiscal year, prepared in
accordance with generally accepted accounting principles in accordance with
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the governmental accounting standards promulgated by the Governmental
Accounting Standards Board or as otherwise provided under Minnesota law, as
in effect from time to time, or, if and to the extent such financial statements
have not been prepared in accordance with such generally accepted accounting
principles for reasons beyond the reasonable control of the City, noting the
discrepancies therefrom and the effect thereof, and certified as to accuracy and
completeness in all material respects by the fiscal officer of the City; and
(B) to the extent not included in the financial statements referred to in paragraph (A)
hereof, the information for such fiscal year or for the period most recently
available of the type contained in the Official Statement under headings:
Current Property Valuations; Direct Debt; Tax Levies and Collections;
Population Trend and Employment/Unemployment Data, which information
may be unaudited.
Notwithstanding the foregoing paragraph, if the audited financial statements are not available by
the date specified, the City shall provide on or before such date unaudited financial statements in
the format required for the audited financial statements as part of the Disclosure Information and,
within 10 days after the receipt thereof, the City shall provide the audited financial statements.
Any or all of the Disclosure Information may be incorporated by reference, if it is updated as
required hereby, from other documents, including official statements, which have been filed with
the SEC or have been made available to the public on the Internet Web site of the Municipal
Securities Rulemaking Board (MSRB). The City shall clearly identify in the Disclosure
Information each document so incorporated by reference. If any part of the Disclosure
Information can no longer be generated because the operations of the City have materially
changed or been discontinued, such Disclosure Information need no longer be provided if the
City includes in the Disclosure Information a statement to such effect, provided, however, if such
operations have been replaced by other City operations in respect of which data is not included in
the Disclosure Information and the City determines that certain specified data regarding such
replacement operations would be described in paragraph (2) hereof, then, from and after such
determination, the Disclosure Information shall include such additional specified data regarding
the replacement operations. If the Disclosure Information is changed or this section is amended
as permitted by this paragraph (b)(1) or subsection (d), then the City shall include in the next
Disclosure Information to be delivered hereunder, to the extent necessary, an explanation of the
reasons for the amendment and the effect of any change in the type of financial information or
operating data provided.
(2) In a timely manner not in excess of ten business days after the occurrence of the
event, notice of the occurrence of any of the following events:
(A) Principal and interest payment delinquencies;
(B) Non - payment related defaults, if material;
(C) Unscheduled draws on debt service reserves reflecting financial difficulties;
(D) Unscheduled draws on credit enhancements reflecting financial difficulties;
(E) Substitution of credit or liquidity providers, or their failure to perform;
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(F) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed
or final determinations of taxability, Notices of Proposed Issue (IRS Form
5701 -TEB) or other material notices or determinations with respect to the tax
status of the Bonds, or other material events affecting the tax status of the
Bonds;
(G) Modifications to rights of security holders, if material;
(H) Bond calls, if material, and tender offers;
(I) Defeasances;
(J) Release, substitution, or sale of property securing repayment of the securities, if
material;
(K) Rating changes;
(L) Bankruptcy, insolvency, receivership or similar event of the City;
(M) The consummation of a merger, consolidation, or acquisition involving an
obligated person or the sale of all or substantially all of the assets of the
obligated person, other than in the ordinary course of business, the entry into a
definitive agreement to undertake such an action or the termination of a
definitive agreement relating to any such actions, other than pursuant to its
terms, if material; and
(N) Appointment of a successor or additional paying agent or the change of name of
a paying agent, if material.
As used herein, for those events that must be reported if material, an event is "material" if it is an
event as to which a substantial likelihood exists that a reasonably prudent investor would attach
importance thereto in deciding to buy, hold or sell a Bond or, if not disclosed, would
significantly alter the total information otherwise available to an investor from the Official
Statement, information disclosed hereunder or information generally available to the public.
Notwithstanding the foregoing sentence, an event is also "material' if it is an event that would be
deemed material for purposes of the purchase, holding or sale of a Bond within the meaning of
applicable federal securities laws, as interpreted at the time of discovery of the occurrence of the
event.
For the purposes of the event identified in (L) hereinabove, the event is considered to occur when
any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an
obligated person in a proceeding under the U.S. Bankruptcy Code or in any other proceeding
under state or federal law in which a court or governmental authority has assumed jurisdiction
over substantially all of the assets or business of the obligated person, or if such jurisdiction has
been assumed by leaving the existing governing body and officials or officers in possession but
subject to the supervision and orders of a court or governmental authority, or the entry of an
order confirming a plan of reorganization, arrangement or liquidation by a court or governmental
authority having supervision or jurisdiction over substantially all of the assets or business of the
obligated person.
(3) In a timely manner, notice of the occurrence of any of the following events or
conditions:
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(A) the failure of the City to provide the Disclosure Information required under
paragraph (b)(1) at the time specified thereunder;
(B) the amendment or supplementing of this section pursuant to subsection (d),
together with a copy of such amendment or supplement and any explanation
provided by the City under subsection (d)(2);
(C) the termination of the obligations of the City under this section pursuant to
subsection (d);
(D) any change in the accounting principles pursuant to which the financial
statements constituting a portion of the Disclosure Information are prepared;
and
(E) any change in the fiscal year of the City.
(c) Manner of Disclosure.
(1) The City agrees to make available to the MSRB, in an electronic format as
prescribed by the MSRB from time to time, the information described in subsection
(b).
(2) All documents provided to the MSRB pursuant to this subsection (c) shall be
accompanied by identifying information as prescribed by the MSRB from time to
time.
(d) Term; Amendments; Interpretation.
(1) The covenants of the City in this section shall remain in effect so long as any Bonds
are Outstanding. Notwithstanding the preceding sentence, however, the obligations
of the City under this section shall terminate and be without further effect as of any
date on which the City delivers to the Registrar an opinion of Bond Counsel to the
effect that, because of legislative action or final judicial or administrative actions or
proceedings, the failure of the City to comply with the requirements of this section
will not cause participating underwriters in the primary offering of the Bonds to be
in violation of the Rule or other applicable requirements of the Securities Exchange
Act of 1934, as amended, or any statutes or laws successory thereto or amendatory
thereof.
(2) This section (and the form and requirements of the Disclosure Information) may be
amended or supplemented by the City from time to time, without notice to (except as
provided in paragraph (c)(3) hereof) or the consent of the Owners of any Bonds, by a
resolution of this Council filed in the office of the recording officer of the City
accompanied by an opinion of Bond Counsel, who may rely on certificates of the
City and others and the opinion may be subject to customary qualifications, to the
effect that: (i) such amendment or supplement (a) is made in connection with a
change in circumstances that arises from a change in law or regulation or a change in
the identity, nature or status of the City or the type of operations conducted by the
City, or (b) is required by, or better complies with, the provisions of paragraph (b)(5)
of the Rule; (ii) this section as so amended or supplemented would have complied
with the requirements of paragraph (b)(5) of the Rule at the time of the primary
16
offering of the Bonds, giving effect to any change in circumstances applicable under
clause (i)(a) and assuming that the Rule as in effect and interpreted at the time of the
amendment or supplement was in effect at the time of the primary offering; and (iii)
such amendment or supplement does not materially impair the interests of the
Bondowners under the Rule.
If the Disclosure Information is so amended, the City agrees to provide,
contemporaneously with the effectiveness of such amendment, an explanation of the
reasons for the amendment and the effect, if any, of the change in the type of
financial information or operating data being provided hereunder.
(3) This section is entered into to comply with the continuing disclosure provisions of
the Rule and should be construed so as to satisfy the requirements of paragraph (b)(5) of the
Rule.
Adopted this 10`h day of May, 2016.
ATTEST: a
C ty Clerk
Reviewed for administration:
17
Jerome O. Faust, Mayor
Mark Casey, ity Manager