5.c) Issuance of General Obligation Equipent Certificates of 2010 r
Meeting Date: 7/6/2010
Agenda Item: �� �l
/
City Council Agenda Report
City of Scandia
14727 209`" St. North
Scandia, MN 55073 (651) 433-2274
Action Requested: Approve issuance of General Obligation Equipment Certificates of
2010 in the amount of$200,000 to finance the purchase of the Fire
Rescue Truck.
Deadline/ Timeline: Planned date of issue is July 15, 2010. Payment for truck will be due
on delivery in late July.
Background: • The 2010 budget for the Equipment Replacement Fund and the
2010-2014 Capital Improvement Plan (CIP) anticipate the issue of
$200,000 in equipment certificates to fund the majority of the
$222,644 cost of the new fire rescue truck.
• Equipment certificates are general obligation debt instruments of
the city. As directed by the Council at its June 15 meeting, the
certificates will be issued for a five-year period through Security
State Bank.
• The city's bond counsel (Steve Bubul of Kennedy and Graven)has
prepared the attached resolution for the Council's approval.
• The debt service will be a financed through a special levy
beginning in 2011 through 2015. A table showing the amortization
schedule, along with the tax levy needed each year, is attached.
Recommendation: I recommend that the Council adopt the resolution.
Attachments/ • Amortization Schedule
Materials provided: • Draft Resolution 07-06-10-03
Contact(s):
Prepared by: Anne Hurlburt, Administrator
(issue equipment certificates)
Page 1 of 1
06/30/10
$200,000 Bond Issue with a 5 year Amortization — Estimate:
Assumes Bonds are Dated July 15, 2010
Due Date Total Levy Levy
Month Year Principal Coupon Interest Payment Amount 5% Cov'g Required Year Amount
8 2011 2.20% $6,112.01 $6,112.01 $305.60 $6,417.61 2011 $51,483.61
2 2012 $40,000.00 2.20% $2,920.00 $42,920.00 $2,146.00 $45,066.00
8 2012 2.60% $2,480.00 $2,480.00 $124.00 '_�2,60��.C)C1 2012 5����,�i)��.�`C
2 2013 $40,000.00 2.60% $2,480.00 $42,480.00 $2,124.00 `,�41,G04.C}{�
8 2013 2.95% $1,960.00 $1,960.00 $98.00 $2,058.00 2013 $46,116.00
2 2014 $40,000.00 2.95% $1,960.00 $41,960.00 $2,098.00 $44,058.00
8 2014 3.30% $1,370.00 $1,370.00 $68.50 $1,438.50 2014 $44,877.00
2 2015 $40,000.00 3.30% $1,370.00 $41,370.00 $2,068.50 $43,438.50
8 2015 3.55% $710.00 $710.00 $35.50 $745.50 2015 $43,491.00
2 2016 $40,000.00 3.55% $710.00 $40,710.00 $2,035.50 $42,745.50
$200,000.00 $22,072.01 $222,072.01 $11,303.60 $233,175.61 $233,175.61
�
\\SERVER\SharedDocs\Departments\Finance\Debt\2010 Equip Cert Levy Page 1
Extract of Minutes of Meeting
of the City Council of the City of
Scandia, Washington County, Minnesota
Pursuant to due call and notice thereof, a regular meeting of the City Council of the City
of Scandia, Minnesota, was duly held in the City Hall in said City on Tuesday, July 6, 2010,
commencing at 7:00 P.M.
The following members were present:
and the following were absent:
* * * � * * * * *
The Mayor announced that the next order of business was consideration of a proposal
which had been received for the purchase of the City's $200,000 General Obligation Equipment
Certificate of 2010.
The City Administrator presented an offer of Security State Bank of Marine, Marine on
St. Croix, Minnesota, to purchase the Certificate that had been submitted to the City pursuant to
Council direction.
After due consideration of the proposal, Member then
introduced the following resolution and moved its adoption:
370560v2 SJB SC835-1
,
RESOLUTION NO. 07-06-10-03
A RESOLUTION AWARDiNG THE SALE OF $200,000
GENERAL OBLIGATION EQUIPMENT CERTIFICATE OF 2010;
FIXING ITS FORM AND SPECIFICATIONS;
DIRECTING ITS EXECUTION AND DELIVERY;
AND PROVIDING FOR ITS PAYMENT
BE IT RESOLVED By the City Council of the City of Scandia, Washington County,
Minnesota (the"City") as follows:
Section 1. Sale of Certificate.
1.01 It is hereby determined that:
a) the City is authorized by Minnesota Statutes, Section 412.301 (the"Act")
to issue its general obligation equipment certificate (the"Certificate") on such terms and
in such manner as the City determines to finance the purchase of items of capital
equipment(the"EquipmenY'), subject to certain limitations contained in the Act;
(b) the City intends to purchase various items of Equipment, which items and
the estimated cost thereof to be financed from proceeds of a Certificate are listed on
Exhibit A, attached hereto and made a part hereof;
(c) as required by the Act,
(i) the expected useful life of each item of Equipment is or will be at
least as long as the term of the Certificate; and
(ii) the principal amount of the Certificate will not exceed 0.25 percent
of the market value of taxable property in the City for taxes payable in
2010, which is the market value as last finally equalized.
(d) it is necessary and expedient to the sound financial management of the
affairs of the City to issue $200,000 General Obligation Equipment Certificate of 2010
pursuant to the Act to provide financing for the Equipment.
1.02. The City is authorized by Minnesota Statutes, section 475.60, subdivision 2(1) to
negotiate the sale of the Certificate, as the Act authorizes the City to issue the Certificate in such
manner as the Council may determine. The actions of the City staff in negotiating the sale of the
Certificate are ratified and confirmed in all aspects.
370560v2 SJB SC835-1 2
1.03. Award to the Purchaser and Interest Rates. The proposal of Security State Bank
of Marine, Marine on St. Croix, Minnesota (the"Purchaser") to purchase the Certificate of the
City is determined to be a reasonable offer and is accepted, the proposal being to purchase the
Certificate at a price of $200,000 plus accrued interest to date of delivery, for the Certificate
bearing interest as follows:
Year Interest Rate Year Interest Rate
2012 2.20% 2015 3.30%
2013 2.60% 2016 3.55%
2014 2.95%
1.04. Purchase Contract. The Mayor and City Administrator are authorized and
directed to execute a contract with the Purchaser on behalf of the City.
1.05. Terms and Principal Amount of the Certificate. The City will forthwith issue and
sell the Certificate pursuant to the Act in the total principal amount of$200,000, originally dated
as of date of delivery, bearing interest as above set forth, and maturing on February 1, 2016
without option of prior payment, but with principal installment payments on February 1 in the
years and amounts as follows:
Year Amount Year Amount
2012 $40,000 2015 $40,000
2013 40,000 2016 40,000
2014 40,000
Section 2. Registration and Pavment.
2.01. Registered Form. The Certificate will be issued only in fully registered form.
The interest thereon and, upon surrender of the Certificate, the principal amount thereof, is
payable by check or draft issued by the Registrar described herein.
2.02. Dates; Interest Payment Dates. The Certificate will be dated as of the last interest
payment date preceding the date of authentication to which interest on the Certificate has been
paid or made available for payment, unless (i) the date of authentication is an interest payment
date to which interest has been paid or made available for payment, in which case the Certificate
will be dated as of the date of authentication, or (ii) the date of authentication is prior to the first
interest payment date, in which case the Certificate will be dated as of the date of original issue.
The interest on the Certificate is payable on February 1 and August 1 of each year, commencing
August 1, 2011, to the registered owners of record as of the close of business on the fifteenth day
of the immediately preceding month, whether or not that day is a business day.
370560v2 SJB SC835-1 3
2.03. Registration. The City will appoint a certificate 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 are as follows:
(a) Re 'i�. The Registrar must keep at its principal corporate trust office
certificate register in which the Registrar provides for the registration of ownership of
Certificates and the registration of transfers and exchanges of the Certificate entitled to be
registered, transferred or exchanged.
(b) Transfer of Certificates. Upon surrender for transfer of the Certificate
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
will authenticate and deliver, in the name of the designated transferee or transferees, one
or more new Certificate 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 that interest payment date.
(c) Exchange of Certificate. When the Certificate is surrendered by the
registered owner for exchange the Registrar will deliver a new Certificate of a like
aggregate principal amount and maturity, as requested by the registered owner or the
owner's attorney in writing.
(d) Cancellation. The Certificate surrendered upon any transfer or exchange
will be promptly cancelled by the Registrar and thereafter disposed of as directed by the
City.
(e) Improper or Unauthorized Transfer. When the Certificate is presented to
the Registrar for transfer, the Registrar may refuse to transfer the Certificate until the
Registrar is satisfied that the endorsement on the Certificate or separate instrument of
transfer is valid and genuine and that the requested transfer is legally authorized. The
Registrar will incur no liability for the refusal, in good faith, to make transfers which it,
in its judgment, deems improper or unauthorized.
(fl Persons Deemed Owners. The City and the Registrar may treat the person
in whose name the Certificate is registered in the certificate register as the absolute owner
of the Certificate, whether the Certificate is overdue or not, for the purpose of receiving
payment of, or on account of, the principal of and interest on the Certificate and for all
other purposes, and payrnents so made to a registered owner or upon the owner's order
will be valid and effectual to satisfy and discharge the liability upon the Certificate to the
extent of the sum or sums so paid.
(g) Taxes, Fees and Char�es. The Registrar may impose a charge upon the
owner thereof for a transfer or exchange of the Certificate sufficient to reimburse the
370560v2 SJB SC835-1 4
Registrar for any tax, fee or other governmental charge required to be paid with respect to
the transfer or exchange.
(h) Mutilated Lost, Stolen or Destroyed Certificates. If the Certificate
becomes mutilated or is destroyed, stolen or lost, the Registrar will deliver a new
Certificate of like amount, number, maturity date and tenor in exchange and substitution
for and upon cancellation of the mutilated Certificate or in lieu of and in substitution for
any Certificate destroyed, stolen or lost, upon the payment of the reasonable expenses
and charges of the Registrar in connection therewith; and, in the case of a Certificate
destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to it that
the Certificate was destroyed, stolen or lost, and of the ownership thereof, and upon
furnishing to the Registrar an appropriate certificate or indemnity in form, substance and
amount satisfactory to it and as provided by law, in which both the City and the Registrar
must be named as obligees. The Certificate so surrendered to the Registrar will be
cancelled by the Registrar and evidence of such cancellation must be given to the City. If
the mutilated, destroyed, stolen or lost Certificate has already matured or been called for
redemption in accordance with its terms it is not necessary to issue a new Certificate prior
to payment.
2.04. Re�istration. The City appoints the City Treasurer as bond registrar (the
"Registrar"). The effect of registration and the rights and duties of the City and the Registrar
with respect thereto are as follows:
(a) Re ig'ster. The Registrar will keep a bond register in which the Registrar
provides for the registration of ownership of Certificates and the registration of transfers
and exchanges of the Certificate entitled to be registered, transferred or exchanged.
(b) Transfer of Certificate. Upon surrender for transfer of the Certificate 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
will deliver, in the name of the designated transferee or transferees, a new Certificate 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 that interest payment
date.
(c) Exchange of Certificate. When the Certificate is surrendered by the
registered owner for exchange the Registrar will deliver one new Certificate of a like
aggregate principal amount and maturity, as requested by the registered owner or the
owner's attorney in writing.
(d) Cancellation. The Certificate surrendered upon any transfer or exchange
will be promptly cancelled by the Registrar and thereafter disposed of as directed by the
City.
370560v2 SJB SC835-1 5
(e) Improper or Unauthorized Transfer. When the Certificate is presented to
the Registrar for transfer, the Registrar may refuse to transfer the Certificate until the
Registrar is satisfied that the endorsement on the Certificate or separate instrument of
transfer is valid and genuine and that the requested transfer is legally authorized. The
Registrar will incur no liability for the refusal, in good faith, to make transfers which it,
in its judgment, deems improper or unauthorized.
(� Persons Deemed Owners. The City and the Registrar may treat the person
in whose name the Certificate is registered in the certificate register as the absolute owner
of the Certificate, whether the Certificate is overdue or not, for the purpose of receiving
payment of, or on account of, the principal of and interest on the Certificate and for all
other purposes, and payments so made to a registered owner or upon the owner's order
will be valid and effectual to satisfy and discharge the liability upon the Certificate to the
extent of the sum or sums so paid.
(g) Taxes, Fees and Char�es. The Registrar may impose a charge upon the
owner thereof for a transfer or exchange of the Certificate sufficient to reimburse the
Registrar for any tax, fee or other governmental charge required to be paid with respect to
the transfer or exchange.
(h) Mutilated, Lost, Stolen or Destroyed Certificates. If the Certificate
becomes mutilated or is destroyed, stolen or lost, the Registrar will deliver a new
Certificate of like amount, number, maturity date and tenor in exchange and substitution
for and upon cancellation of the mutilated Certificate or in lieu of and in substitution for
any Certificate destroyed, stolen or lost, upon the payment of the reasonable expenses
and charges of the Registrar in connection therewith; and, in the case of a Certificate
destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to it that
the Certificate was destroyed, stolen or lost, and of the ownership thereof, and upon
furnishing to the Registrar an appropriate certificate or indemnity in form, substance and
amount satisfactory to it and as provided by law, in which both the City and the Registrar
must be named as obligees. The Certificate so surrendered to the Registrar will be
cancelled by the Registrar and evidence of such cancellation must be given to the City. If
the mutilated, destroyed, stolen or lost Certificate has already matured or been called for
redemption in accordance with its terms it is not necessary to issue a new Certificate prior
to payment.
2.05. Execution and Deliverv. The Certificate will be prepared under the direction of
the City Administrator and executed on behalf of the City by the signatures of the Mayor and the
City Administrator, provided that all signatures may be printed, engraved or lithographed
facsimiles of the originals. If an officer whose signature or a facsimile of whose signature
appears on the Certificate ceases to be such officer before the delivery of any Certificate, that
signature or facsimile will nevertheless be valid and sufficient for all purposes, the same as if the
officer had remained in office until delivery. When the Certificate has been so prepared and
executed, the City Administrator will deliver the same to the Purchaser upon payment of the
370560v2 SJB SC835-1 6
purchase price in accordance with the contract of sale heretofore made and executed, and the
Purchaser is not obligated to see to the application of the purchase price.
2.06. Temporary Certificates. The City may elect to deliver in lieu of a printed
definitive Certificate one typewritten temporary Certificate in substantially the form set forth in
Section 3 with such changes as may be necessary to reflect more than one maturity in a single
temporary certificate. Upon the execution and delivery of the definitive Certificate the
temporary Certificate will be exchanged therefor and cancelled.
Section 3. Form of Certificate.
3.01. Execution of the Certificate. The Certificate will be typewritten in substantially
the following form:
No. R-1 UNITED STATES OF AMERICA $200,000
STATE OF MINNESOTA
COUNTY OF WASHINGTON
CITY OF SCANDIA
GENERAL OBLIGATION EQUIPMENT CERTIFICATE OF 2010
Date of
Maturitv Original Issue
February 1, 2016 July 15, 2010
The City of Scandia, Minnesota, a duly organized and existing municipal corporation in
Washington County, Minnesota (the"City"), acknowledges itself to be indebted and for value
received hereby promises to pay to Security State Bank of Marine, Marine on St. Croix,
Minnesota or registered assigns, the principal sum of $200,000 payable on February 1 in
installments in the amounts and in the years specified below, without option of prior payment,
with interest thereon from the date hereof at the interest rates specified below, payable
February 1 and August 1 in each year, commencing August 1, 2011,to the person in whose name
this Certificate is registered at the close of business on the fifteenth day (whether or not a
business day) of the immediately preceding month.
Year Interest Rate Installment Year Interest Rate Installment
2012 2.20% $40,000 2015 3.30% $40,000
2013 2.60% 40,000 2016 3.55% 40,000
2014 2.95% 40,000
370560v2 SJB SC835-1 7
The interest hereon and, upon presentation and surrender hereof, the principal hereof are payable
in lawful money of the United States of America by check or draft by the Treasurer of the City of
Scandia, Minnesota, as Certificate Registrar, Paying Agent, and Transfer Agent, or its designated
successor under the Resolution described herein. For the prompt and full payment of such
principal and interest as the same respectively become due, the full faith and credit and taxing
powers of the City have been and are hereby irrevocably pledged.
The City Council has designated the Certificate as a "qualified tax exempt obligation"
within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended
(the"Code") relating to disallowance of interest expense for financial institutions and within the
$30 million limit allowed by the Code for the calendar year of issue.
This Certificate is issued pursuant to a resolution adopted by the City Council on July 6,
2010 (the"Resolution"), for the purpose of providing money to defray expenses incurred or to be
incurred in purchasing various items of capital equipment, pursuant to and in full conformity
with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Section
412.301, and the principal hereof and interest hereon are payable primarily from ad valorem
taxes, as set forth in the Resolution to which reference is made for a full statement of rights and
powers thereby conferred. The full faith and credit of the City are irrevocably pledged for
payment of this Certificate and the City Council has obligated itself to levy additional ad
valorem taxes on all taxable property in the City in the event of any deficiency, which taxes may
be levied without limitation as to rate or amount.
As provided in the Resolution and subject to certain limitations set forth therein, this
Certificate is transferable upon the books of the City at the principal office of the Certificate
Registrar, by the registered owner hereof in person or by the owner's attorney duly authorized in
writing, upon surrender hereof together with a written instrument of transfer satisfactory to the
Certificate Registrar, duly executed by the registered owner or the owner's attorney; and may
also be surrendered in exchange for Certificates of other authorized denominations. Upon such
transfer or exchange the City will cause a new Certificate or Certificates to be issued in the name
of the transferee or registered owner, of the same aggregate principal amount, bearing interest at
the same rate and maturing on the same date, subject to reimbursement for any tax, fee or
governmental charge required to be paid with respect to such transfer or exchange.
The City and the Certificate Registrar may deem and treat the person in whose name this
Certificate is registered as the absolute owner hereof, whether this Certificate is overdue or not,
for the purpose of receiving payment and for all other purposes, and neither the City nor the
Certificate Registrar will be affected by any notice to the contrary.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts,
conditions and things required by the Constitution and laws of the State of Minnesota to be done,
to exist, to happen and to be performed preliminary to and in the issuance of this Certificate in
order to make it a valid and binding general obligation of the City in accordance with its terms,
have been done, do exist, have happened and have been performed as so required, and that the
370560v2 SJB SC835-1 g
issuance of this Certificate does not cause the indebtedness of the City to exceed any
constitutional or statutory limitation of indebtedness.
IN WITNESS WHEREOF, the City of Scandia, Washington County, Minnesota, by its
City Council, has caused this Certificate to be executed on its behalf by the facsimile or manual
signatures of the Mayor and City Administrator and has caused this Certificate to be dated as of
the date set forth below.
Dated:
CITY OF SCANDIA, MINNESOTA
(Facsimile) (Facsimile)
City Administrator Mayor
PROVISIONS AS TO REGISTRATION
The ownership of the principal of and interest on the within Certificate has been
registered on the books of the Registrar in the name of the person last noted below.
Signature of
Date of Registration Registered Owner City Treasurer
Security State Bank of
Marine
Marine on St. Croix,
Minnesota
Federal ID #41-0531810
3.02. Approving Legal Opinion. The City Administrator is authorized and directed to
obtain a copy of the proposed approving legal opinion of Kennedy & Graven, Chartered,
Minneapolis, Minnesota, which will be complete except as to dating thereof and to cause the
opinion to be printed on or accompany on each Certificate.
Section 4. Pavment; Securit ;�ges and Covenants.
4.01. Debt Service Fund. The Certificate is payable from the General Obligation
Equipment Certificate of 2010 Debt Service Fund (the"Debt Service Fund") hereby created, and
the proceeds of the ad valorem taxes hereinafter levied are pledged to the Debt Service Fund. If
a payment of principal or interest on the Certificate becomes due when there is not sufficient
money in the Debt Service Fund to pay the same, the City Treasurer will pay such principal or
interest from the general fund of the City, and the general fund may be reimbursed for those
advances out of the proceeds of the taxes levied by this resolution, when collected.
370560v2 SJB SC835-1 (�
4.02. Pledge of Taxes. For the purpose of paying the principal of and interest on the
Certificate, there is levied a direct annual irrepealable ad valorem tax upon all of the taxable
property in the City, which will be spread upon the tax rolls and collected with and as part of
other general taxes of the City. Such tax will be credited to the Debt Service Fund above
provided and will be in the years and amounts as follows (year stated being year of collection):
Year Levv
(See Exhibit B)
4.03. Certification to Director of Propertv Records and Taxpaver Services as to Debt
Service Fund Amount. It is determined that the estimated collection of the foregoing taxes will
produce at least five percent in excess of the amount needed to meet when due, the principal and
interest payments on the Certificate. The tax levy herein provided is irrepealable until the
Certificate is paid, provided that at the time the City makes its annual tax levies, the City
Administrator may certify to the Director of Property Records and Taxpayer Services
Washington County the amount available in the Debt Service Fund to pay principal and interest
due during the ensuing year, and the County Auditor Director of Property Records and Taxpayer
Services will thereupon reduce the levy collectible during such year by the amount so certified.
4.04. Director of Property Records and Taxpaver Services Certificate as to Registration.
The City Administrator is authorized and directed to file a certified copy of this resolution with
the Director of Property Records and Taxpayer Services and to obtain the certificate required by
Minnesota Statutes, Section 475.63.
Section 5. Authentication of Transcrint.
5.01. Citv Proceedings and Records. The officers of the City are authorized and directed
to prepare and furnish to the Purchaser and to the attorneys approving the Certificate, certified
copies of proceedings and records of the City relating to the Certificate and to the financial
condition and affairs of the City, and such other certificates, affidavits and transcripts as may be
required to show the facts within their knowledge or as shown by the books and records in their
custody and under their control, relating to the validity and marketability of the Certificate, and
such instruments, including any heretofore furnished, will be deemed representations of the City
as to the facts stated therein.
5.02. No Official Statement or Prospectus. It is determined that no official statement or
prospectus has been prepared or circulated by the City in connection with the sale of the
Certificate and that the Purchaser has made its own investigations concerning the City as set
forth in an investment letter of even date, receipt of which is hereby acknowledged.
370560v2 SJB SC835-1 10
Section 6. Tax Covenant.
6.01. Tax-Exempt Certificates. The City covenants and agrees with the holders from
time to time of the Certificate 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 Certificate to become
subject to taxation under the Internal Revenue Code of 1986, as amended (the"Code"), and the
Treasury Regulations promulgated thereunder, in effect at the time of such actions, and that it
will take or cause its officers, employees or agents to take, all affirmative action within its power
that may be necessary to ensure that such interest will not become subject to taxation under the
Code and applicable Treasury Regulations, as presently existing or as hereafter amended and
made applicable to the Certificate.
6.02. No Rebate Required. (a) The City will comply with requirements necessary
under the Code to establish and maintain the exclusion from goss income of the interest on the
Certificate under Section 103 of the Code, including without limitation requirements relating to
temporary periods for investments, limitations on amounts invested at a yield geater than the
yield on the Certificate, and the rebate of excess investment earnings to the United States, if the
Certificate (together with other obligations reasonably expected to be issued in calendar year
2010) exceed the small-issuer exception amount of$5,000,000.
(b) For purposes of qualifying for the small issuer exception to the federal arbitrage
rebate requirements, the City finds, determines and declares that the aggregate face amount of all
tax-exempt certificates (other than private activity bonds) issued by the City (and all subordinate
entities of the City) during the calendar year in which the Certificate is issued and outstanding at
one time is not reasonably expected to exceed $5,000,000, all within the meaning of Section
148(fl(4)(D) of the Code.
6.03. Not Private Activitv Bond. The City further covenants not to use the proceeds of
the Certificate in such a manner as to cause the Certificate to be a "private activity bond" within
the meaning of Sections 103 and 141 through 150 of the Code.
6.04. Qualified Tax-Exempt Obligations. In order to qualify the Certificate as a
"qualified tax-exempt obligation" within the meaning of Section 265(b)(3) of the Code, the City
makes the following factual statements and representations:
(a) the Certificate is not a "private activity bond" as defined in Section 141 of
the Code;
(b) the City designates the Certificate as a "qualified tax-exempt obligation"
for purposes of Section 265(b)(3) of the Code;
(c) the reasonably anticipated amount of tax-exempt obligations (other than
private activity bonds that are not qualified 501(c)(3) bonds) which will be issued by the
City (and all subordinate entities of the City) during calendar year 2010 will not exceed
$30,000,000; and
370560v2 SJB SC835-1 1 1
(d) not more than $30,000,000 of obligations issued by the City during
calendar year 2010 have been designated for purposes of Section 265(b)(3) of the Code.
6.05. Procedural Requirements. The City will use its best efforts to comply with any
federal procedural requirements which may apply in order to effectuate the designations made by
this section.
Section 7. Continuing Disclosure.
7.01. No Requirement of Continuing Disclosure. Participating underwriters need not
comply with the continuing disclosure requirements of Rule 15c2-12 promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934 (the "Rule"),
because the offering is in a principal amount less than $1,000,000. Consequently, the City will
not enter into any undertaking to provide continuing disclosure of any kind with respect to the
Certificate.
Section 8. Defeasance.
8.01. Pledges,Covenants, and Other Rights to Cease. When the Certificate and all interest
thereon, have been discharged as provided in this section, all pledges, covenants and other rights
granted by this resolution to the holders of the Certificate will cease, except that the pledge of the
full faith and credit of the City for the prompt and full payment of the principal of and interest on
the Certificate will remain in full force and effect. The City may discharge the Certificate which is
due on any date by depositing with the Registrar on or before that date a sum sufficient for the
payment thereof in full. If the Certificate should not be paid when due, it may nevertheless be
discharged by depositing with the Registrar a sum sufficient for the payrnent thereof in full with
interest accrued to the date of such deposit.
(The remainder of this page is intentionally left blank.)
370560v2 SJB SC835-1 12
The motion for the adoption of the foregoing resolution was duly seconded by Member
, and upon vote being taken thereon, the following voted in favor
thereof:
and the following voted against the same:
whereupon the resolution was declared duly passed and adopted.
370560v2 SJB SC835-1 13
STATE OF MINNESOTA )
)
COUNTY OF WASHINGTON ) SS.
)
CITY OF SCANDIA )
I, the undersigned, being the duly qualified and acting Administrator of the City of
Scandia, Washington County, Minnesota, do hereby certify that I have carefully compared the
attached and foregoing extract of minutes of a regular meeting of the City Council of the City
held on July 6, 2010 with the original minutes on file in my office and the extract is a full, true
and correct copy of the minutes insofar as they relate to the issuance and sale of $200,000
General Obligation Equipment Certificate of 2010 of the City.
WITNESS My hand officially as such City Administrator and the corporate seal of the
City this day of , 2010.
City Administrator
Scandia, Minnesota
(SEAL)
370560v2 SJB SC835-I
STATE OF MINNESOTA DIRECTOR OF PROPERTY RECORDS
AND TAXPAYER SERVICES
CERTIFICATE AS TO
COUNTY OF WASHINGTON TAX LEVY AND
REGISTRATION
I, the undersigned Director of Property Records and Taxpayer Services of Washington
County, Minnesota, hereby certify that a certified copy of a resolution adopted by the governing
body of the City of Scandia, Minnesota, on July 6, 2010, levying taxes for the payment of
$200,000 General Obligation Equipment Certificate of 2010 of said municipality dated as of date
of delivery, has been filed in my office and said Certificate has been entered on the register of
obligations in my office and that such tax has been levied as required by law.
WITNESS My hand and official seal this day of , 2010.
Director of Property Records and Taxpayer
Services
Washington County,Minnesota
(SEAL)
Deputy
370560v2 S1B SC835-1
EXHIBIT A
EQUIPMENT
Fire RescueTruck $222,644.00
A-1
370560v2 SJB SC835-1
EXHIBIT B
TAX LEVY SCHEDULE
YEAR * TAX LEVY
2011 $51,483.61
2012 $47,208.00
2013 $46,116.00
2014 $44,877.00
2015 $43,491.00
* Year tax levy collected.
370560v2 SJB SC835-1 B_1