HomeMy WebLinkAbout[06] Bond Sale •
('ITV OF ST JOSEPH Council Agenda Item 6
MEETING DATE: October 6, 2011
AGENDA ITEM: Bond Sale, Monte Eastvold
SUBMITTED BY: Administration /Finance
BOARD /COMMISSION /COMMITTEE RECOMMENDATION:
PREVIOUS COUNCIL ACTION: On September 15, 2011 the City Council amended the Capital
Improvement Plan to include repairs to the roof and HVAC system at City Hall and to make necessary
repairs to the police garage for energy efficiencies. In addition, the City approved the necessary repairs
to the Tri City Lift Station and have approved the refinancing of the Fire Hall to take advantage of the
reduced interest rates.
BACKGROUND INFORMATION: The City went through the rating process on September 20, 2011. The
bond rating re- affirmed the City's Al rating.
BUDGET /FISCAL IMPACT: The final impact will be presented to the Council at the meeting
ATTACHMENTS: Request for Council Action 6:1 -2
Resolution 2011 -023 Providing for Sale 6:3 -32
Credit Rating Report 6:33 -36
REQUESTED COUNCIL ACTION: Authorize execution of Resolution 2011 -023 Providing for the sale of $
2,335,000 General Obligation Bonds and a second action to authorize the sale of the bonds to Northland
Securities.
Note: Monte Eastvold will be present at the meeting and will provide additional information.
THIS PAGE INTENTIONALLY LEFT BLANK
EXTRACT OF MINUTES OF A MEETING
OF THE CITY COUNCIL
CITY OF ST. JOSEPH, MINNESOTA
HELD: October 6, 2011
Pursuant to due call and notice thereof, a regular or special meeting of the City Council
of the City of St. Joseph, Stearns County, Minnesota, was duly called and held at the City Hall
on October 6, 2011, at 7:00 P.M., for the purpose, in part, of authorizing the issuance and
awarding the sale of $2,335,000 General Obligation Bonds, Series 2011A.
The following members were present:
and the following were absent:
Member introduced the following resolution and moved its adoption:
RESOLUTION NO. 2011-023
RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF $2,335,000 GENERAL
OBLIGATION BONDS, SERIES 2011A, PLEDGING FOR THE SECURITY THEREOF
SPECIAL ASSESSMENTS AND NET REVENUES AND LEVYING A TAX FOR THE
PAYMENT THEREOF
A. WHEREAS, the City Council of the City of St. Joseph, Minnesota (the "City "),
hereby determines and declares that it is necessary and expedient to provide moneys for:
1. a current refunding of the City's $815,000 original principal amount of
General Obligation Fire Hall Crossover Refunding Bonds of 2003 dated July 1, 2003 (the
"Prior Fire Hall Bonds "); and
2. a crossover advance refunding of the City's $2,375,000 original principal
amount of General Obligation Improvement Bonds, Series 2006C, dated June 1, 2006
(the "Prior Improvement Bonds "); and
3. the construction of various improvements to the sanitary sewer system (the
"System Improvements ") pursuant to Minnesota Statutes, Chapter 444; and
4. the construction of capital improvement plan projects (the "CIP
Improvements ") pursuant to Minnesota Statutes, Section 475.521; and
5. acquisition of various items of capital equipment (the "Equipment ")
pursuant to Minnesota Statutes, Chapter 412.301; and
4289728v1
B. WHEREAS, $430,000 of the principal amount of the Prior Fire Hall Bonds which
mature, or are subject to mandatory redemption, on and after December 1, 2012 are callable on
December 1, 2011 (the "Call Date ") and on any date thereafter, at a price of par plus accrued
interest, as provided in the Resolution adopted by the City Council on July 2, 2003 (the "Prior
Fire Hall Bonds Resolution "), authorizing the issuance of the Prior Fire Hall Bonds; and
C. WHEREAS, $1,435,000 of the principal amount of the Prior Improvement Bonds
which mature, or are subject to mandatory redemption, on and after December 1, 2014, are
callable on December 1, 2013 (the "Crossover Date "), at a price of par plus accrued interest, as
provided in the Resolution adopted by the City Council on May 18, 2006, authorizing the
issuance of the Prior Improvement Bonds (the "Prior Improvement Bonds Resolution" and
together with the Prior Fire Hall Bonds Resolution, the "Prior Resolutions "); and
D. WHEREAS, (i) the current refunding of the Prior Fire Hall Bonds (the "Refunded
Fire Hall Bonds "); and (ii) the crossover advance refunding of the Prior Improvement Bonds (the
"Refunded Improvement Bonds" and, together with the Refunded Fire Hall Bonds, the
"Refunded Bonds "), is consistent with covenants made with the holders thereof, and is necessary
and desirable for the reduction of debt service cost to the City; and
E. WHEREAS, the City's CIP Improvements will be financed under a Capital
Improvement Plan and on September 15, 2011, the City held a public hearing on the proposed
issuance of general obligation capital improvement plan bonds and, approved and adopted the
2011 through 2015 Five -Year Capital Improvement Plan (the "Plan"), and approved the issuance
of general obligation capital improvement plan bonds to finance the construction of the City's
various capital improvement projects within the City (the "Project "), all pursuant to the Plan and
in accordance with the provisions of Minnesota Statutes, Section 475.521; and
F. WHEREAS, no petition signed by voters equal to five percent of the votes cast in
the City in the last general election requesting a vote on the issuance of the general obligation
capital improvement plan bonds has been filed with the Administrator within thirty days after the
public hearing on the Plan and on the issuance of the general obligation capital improvement
plan bonds; and
G. WHEREAS, the City has heretofore determined, in accordance with Minnesota
Statutes, Section 475.521, Subd. 4, that the principal and interest to become due in any year on
all the outstanding bonds issued by the City under Minnesota Statutes, Section 475.521,
including the Bonds, will be less than 0.16 percent of the taxable market value of property in the
City; and
H. WHEREAS, (a) the amount of bonds to be issued to finance the Equipment does
not exceed one - quarter of one percent (0.25 %) of the market value of the taxable property in the
City ($ times 0.25% is $ ) and (b) each item of equipment to be
financed by the bonds has an expected useful life at least as long as the term of the bonds; and
I. WHEREAS, the City owns and operates a municipal sewer system (the "System ")
as a separate revenue producing public utility and there are currently outstanding $3,010,000
original principal amount of General Obligation Crossover Refunding Bonds, Series 2009A,
2
4289728v1
dated March 1, 2009, $ of which is payable from the net revenues of the System (the
"Outstanding Bonds "); and
J. WHEREAS, the City Council hereby determines and declares that it is necessary
and expedient to issue $2,335,000 General Obligation Bonds, Series 2011A (the "Bonds" or
individually, a "Bond"), pursuant to Minnesota Statutes, Chapter 475, to provide moneys for (i) a
current refunding of the Refunded Fire Hall Bonds; (ii) a crossover advance refunding of the
Refunded Improvement Bonds; (iii) the acquisition of capital Equipment; (iv) the construction of
CIP Improvements in the City; and (v) the construction of the System Improvements; and
K. WHEREAS, the City has retained Blue Rose Capital Advisors, Inc., in
Minneapolis, Minnesota, as its independent financial advisor for the sale of the Bonds, and was
therefore authorized to sell the Bonds by private negotiation in accordance with Minnesota
Statutes, Section 473.60, Subdivision 2(9); and
L. WHEREAS, it is in the best interests of the City that the Bonds be issued in book -
entry form as hereinafter provided; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of St. Joseph,
Minnesota, as follows:
1. Acceptance of Offer. The offer of Northland Securities, Inc. (the "Purchaser "), to
purchase the Bonds in accordance with the terms and at the rates of interest hereinafter set forth,
and to pay therefor the sum of $ , plus interest accrued to settlement, is hereby
accepted.
2. Bond Terms.
(a) Original Issue Date; Denominations; Maturities. The Bonds shall be dated
November 1, 2011, as the date of original issue, shall be issued forthwith on or after such date in
fully registered form, shall be numbered from R -1 upward in the denomination of $5,000 each or
in any integral multiple thereof of a single maturity (the "Authorized Denominations ") and shall
mature on October 1 in the years and amounts as follows:
Year Amount Year Amount
2012 2017
2013 2018
2014 2019
2015 2020
2016 2021
As may be requested by the Purchaser, one or more term Bonds may be issued having
mandatory sinking fund redemption and final maturity amounts conforming to the foregoing
principal repayment schedule, and corresponding additions may be made to the provisions of the
applicable Bond(s).
3
4289728v1
(b) Book Entry Only District. The Depository Trust Company, a limited purpose
trust company organized under the laws of the State of New York or any of its successors or its
successors to its functions hereunder (the "Depository ") will act as securities depository for the
Bonds, and to this end:
(i) The Bonds shall be initially issued and, so long as they remain in book
entry form only (the "Book Entry Only Period "), shall at all times be in the form of a
separate single fully registered Bond for each maturity of the Bonds; and for purposes of
complying with this requirement under paragraphs 6 and 11 Authorized Denominations
for any Bond shall be deemed to be limited during the Book Entry Only Period to the
outstanding principal amount of that Bond.
(ii) Upon initial issuance, ownership of the Bonds shall be registered in a bond
register maintained by the Bond Registrar (as hereinafter defined) in the name of CEDE
& CO., as the nominee (it or any nominee of the existing or a successor Depository, the
"Nominee ").
(iii) With respect to the Bonds neither the City nor the Bond Registrar shall
have any responsibility or obligation to any broker, dealer, bank, or any other financial
institution for which the Depository holds Bonds as securities depository (the
"Participant ") or the person for which a Participant holds an interest in the Bonds shown
on the books and records of the Participant (the "Beneficial Owner "). Without limiting
the immediately preceding sentence, neither the City, nor the Bond Registrar, shall have
any such responsibility or obligation with respect to (A) the accuracy of the records of the
Depository, the Nominee or any Participant with respect to any ownership interest in the
Bonds, or (B) the delivery to any Participant, any Owner or any other person, other than
the Depository, of any notice with respect to the Bonds, including any notice of
redemption, or (C) the payment to any Participant, any Beneficial Owner or any other
person, other than the Depository, of any amount with respect to the principal of or
premium, if any, or interest on the Bonds, or (D) the consent given or other action taken
by the Depository as the Registered Holder of any Bonds (the "Holder "). For purposes of
securing the vote or consent of any Holder under this Resolution, the City may, however,
rely upon an omnibus proxy under which the Depository assigns its consenting or voting
rights to certain Participants to whose accounts the Bonds are credited on the record date
identified in a listing attached to the omnibus proxy.
(iv) The City and the Bond Registrar may treat as and deem the Depository to
be the absolute owner of the Bonds for the purpose of payment of the principal of and
premium, if any, and interest on the Bonds, for the purpose of giving notices of
redemption and other matters with respect to the Bonds, for the purpose of obtaining any
consent or other action to be taken by Holders for the purpose of registering transfers
with respect to such Bonds, and for all purpose whatsoever. The Bond Registrar, as
paying agent hereunder, shall pay all principal of and premium, if any, and interest on the
Bonds only to the Holder or the Holders of the Bonds as shown on the bond register, 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 premium, if any, and interest on the Bonds
to the extent of the sum or sums so paid.
4
4289728v1
(v) Upon delivery by the Depository to the Bond Registrar of written notice to
the effect that the Depository has determined to substitute a new Nominee in place of the
existing Nominee, and subject to the transfer provisions in paragraph 11, references to the
Nominee hereunder shall refer to such new Nominee.
(vi) So long as any Bond is registered in the name of a Nominee, all payments
with respect to the principal of and premium, if any, and interest on such Bond and all
notices with respect to such Bond shall be made and given, respectively, by the Bond
Registrar or City, as the case may be, to the Depository as provided in the Letter of
Representations to the Depository required by the Depository as a condition to its acting
as book -entry Depository for the Bonds (said Letter of Representations, together with any
replacement thereof or amendment or substitute thereto, including any standard
procedures or policies referenced therein or applicable thereto respecting the procedures
and other matters relating to the Depository's role as book -entry Depository for the
Bonds, collectively hereinafter referred to as the "Letter of Representations ").
(vii) All transfers of beneficial ownership interests in each Bond issued in
book -entry form shall be limited in principal amount to Authorized Denominations and
shall be effected by procedures by the Depository with the Participants for recording and
transferring the ownership of beneficial interests in such Bonds.
(viii) In connection with any notice or other communication to be provided to
the Holders pursuant to this Resolution by the City or Bond Registrar with respect to any
consent or other action to be taken by Holders, the Depository shall consider the date of
receipt of notice requesting such consent or other action as the record date for such
consent or other action; provided, that the City or the Bond Registrar may establish a
special record date for such consent or other action. The City or the Bond Registrar shall,
to the extent possible, give the Depository notice of such special record date not less than
15 calendar days in advance of such special record date to the extent possible.
(ix) Any successor Bond Registrar in its written acceptance of its duties under
this Resolution and any paying agency/bond registrar agreement, shall agree to take any
actions necessary from time to time to comply with the requirements of the Letter of
Representations.
(x) In the case of a partial prepayment of a Bond, the Holder may, in lieu of
surrendering the Bonds for a Bond of a lesser denomination as provided in paragraph 6
hereof, make a notation of the reduction in principal amount on the panel provided on the
Bond stating the amount so redeemed.
(c) Termination of Book -Entry Only District. Discontinuance of a particular
Depository's services and termination of the book -entry only District may be effected as follows:
(i) The Depository may determine to discontinue providing its services with
respect to the Bonds at any time by giving written notice to the City and discharging its
responsibilities with respect thereto under applicable law. The City may terminate the
services of the Depository with respect to the Bond if it determines that the Depository is
5
4289728v1
no longer able to carry out its functions as securities depository or the continuation of the
District of book -entry transfers through the Depository is not in the best interests of the
City or the Beneficial Owners.
(ii) Upon termination of the services of the Depository as provided in the
preceding paragraph, and if no substitute securities depository is willing to undertake the
functions of the Depository hereunder can be found which, in the opinion of the City, is
willing and able to assume such functions upon reasonable or customary terms, or if the
City determines that it is in the best interests of the City or the Beneficial Owners of the
Bond that the Beneficial Owners be able to obtain certificates for the Bonds, the Bonds
shall no longer be registered as being registered in the bond register in the name of the
Nominee, but may be registered in whatever name or names the Holder of the Bonds
shall designate at that time, in accordance with paragraph 11. To the extent that the
Beneficial Owners are designated as the transferee by the Holders, in accordance with
paragraph 11, the Bonds will be delivered to the Beneficial Owners.
(iii) Nothing in this subparagraph (c) shall limit or restrict the provisions of
paragraph 11.
(d) Letter of Representations. The provisions in the Letter of Representations are
incorporated herein by reference and made a part of the resolution, and if and to the extent any
such provisions are inconsistent with the other provisions of this resolution, the provisions in the
Letter of Representations shall control.
3. Allocation. The aggregate principal amount of $ maturing in
each of the years and amounts hereinafter set forth are issued to refund the Prior Fire Hall Bonds
(the "Prior Fire Hall Refunding Portion "). The aggregate principal amount of $
maturing in each of the years and amounts hereinafter set forth are issued to refund the Prior
Improvement Bonds (the "Prior Improvement Refunding Portion "). The aggregate principal
amount of $ maturing in each of the years and amounts hereinafter set forth are
issued to finance the CIP Improvements (the "CIP Portion "). The aggregate principal amount of
$ maturing in each of the years and amounts hereinafter set forth are issued to
finance the Equipment (the "Equipment Portion "). The aggregate principal amount of
$ maturing in each of the years and amounts hereinafter set forth are issued to finance
the System Improvements (the "System Portion "):
Prior Fire Prior
Hall Improvement
Refunding Refunding CIP Equipment System Total
Year Portion Portion Portion Portion Portion Amount
2012
2013
2014
2015
2016
2017
6
4289728v1
2018
2019
2020
2021
If Bonds are prepaid, the prepayments shall be allocated to the portions of debt service
(and hence allocated to the payment of Bonds treated as relating to a particular portion of debt
service) as provided in this paragraph. If the source of prepayment is the general fund of the
City, or other generally available source, the prepayment may be allocated to any of the portions
of debt service in such amounts as the City shall determine. If the source of a prepayment is
taxes pledged to the Fire Hall Refunding Portion of the Bonds, the prepayment shall be allocated
to the Prior Fire Hall Refundng Portion of debt service. If the source of a prepayment is taxes or
special assessments pledged to the Prior Improvement Bonds, the prepayment shall be allocated
to the Prior Improvement Refunding Portion of debt service. If the source of a prepayment is
taxes pledged to the Equipment Portion of the Bonds, the prepayment shall be allocated to the
Equipment Portion of debt service. If the source of a prepayment is net revenues of the System
pledged to the System Improvements, the prepayment shall be allocated to the System Portion of
debt service.
4. Purpose; Refunding Findings. The Prior Fire Hall Refunding Portion of the
Bonds shall provide funds for (i) a current refunding of the Refunded Fire Hall Bonds (the
"Current Refunding "); (ii) the Prior Improvement Refunding Portion of the Bonds shall provide
funds for a crossover advance refunding of the Refunded Improvement Bonds (the "Crossover
Refunding" and, together with the Current Refunding, the "Refundings "); (iii) the CIP Portion of
the Bonds shall provide funds to finance the CIP Improvements (the "CIP Project "); (iv) the
Equipment Portion shall provide funds to finance the Equipment (the "Equipment "); (v) the
System Portion shall provide funds to finance the System Improvements (the "System Project ");
and together with the CIP Project, and the Equipment, the "Project "). It is hereby found,
determined and declared that the Refundings are pursuant to Minnesota Statutes, Section 475.67.
With respect to the Refunded Improvement Bonds, as of the Crossover Date there shall result a
reduction in the present value of the dollar amount of the debt service to the City from a total
dollar amount of $ for the Prior Improvement Bonds to a total dollar amount of
$ for the Prior Improvement Refunding Portion of the Bonds computed in
accordance with the provisions of Minnesota Statutes, Section 475.67, Subdivision 12. The
dollar amount of such present value of the debt service for the Prior Improvement Refunding
Portion of the Bonds is lower by at least three percent than the dollar amount of such present
value of the debt service for the Prior Improvement Bonds as required by Minnesota Statutes,
Section 475.67, Subdivision 12. The total cost of the Project, which shall include all costs
enumerated in Minnesota Statutes, Section 475.65, is estimated to be at least equal to the amount
of the CIP Portion, the Equipment and System Portion of the Bonds. The City covenants that it
shall do all things and perform all acts required of it to assure that work on the Project proceeds
with due diligence to completion and that any and all permits and studies required under law for
the Project are obtained.
5. Interest. The Bonds shall bear interest payable semiannually on April 1 and
October 1 of each year (each, an "Interest Payment Date "), commencing April 1, 2012,
7
4289728v1
calculated on the basis of a 360 -day year of twelve 30 -day months, at the respective rates per
annum set forth opposite the maturity years as follows:
Maturity Year Interest Rate Maturity Year Interest Rate
2012 % 2017
2013 2018
2014 2019
2015 2020
2016 2021
6. Optional Redemption. All Bonds maturing on October 1, 2019, and thereafter,
shall be subject to redemption and prepayment at the option of the City on October 1, 2018, and
on any date thereafter at a price of par plus accrued interest. Redemption may be in whole or in
part of the Bonds subject to prepayment. If redemption is in part, and the selection of the
amounts and maturities of the Bonds to be prepaid shall be at the discretion of the City. If only
part of the Bonds having a common maturity date are called for prepayment, the specific Bonds
to be prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof called for
redemption shall be due and payable on the redemption date, and interest thereon shall cease to
accrue from and after the redemption date. Mailed notice of redemption shall be given to the
paying agent and to each affected registered holder of the Bonds at least thirty (30) days prior to
the date fixed for redemption.
To effect a partial redemption of Bonds having a common maturity date, the Bond
Registrar prior to giving notice of redemption shall assign to each Bond having a common
maturity date a distinctive number for each $5,000 of the principal amount of such Bond. The
Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in
its discretion, from the numbers so assigned to such Bonds, as many numbers as, at $5,000 for
each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be
redeemed shall be the Bonds to which were assigned numbers so selected; provided, however,
that only so much of the principal amount of each such Bond of a denomination of more than
$5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If
a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the
City or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the
City and Bond Registrar duly executed by the Holder thereof or the Holder's attorney duly
authorized in writing) and the City shall execute (if necessary) and the Bond Registrar shall
authenticate and deliver to the Holder of the Bond, without service charge, a new Bond or Bonds
having the same stated maturity and interest rate and of any Authorized Denomination or
Denominations, as requested by the Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Bond so surrendered.
7. Bond Registrar. Northland Trust Services, Inc., in Minneapolis, Minnesota, is
appointed to act as bond registrar and transfer agent with respect to the Bonds (the "Bond
Registrar "), and shall do so unless and until a successor Bond Registrar is duly appointed, all
pursuant to any contract the City and Bond Registrar shall execute which is consistent herewith.
The Bond Registrar shall also serve as paying agent unless and until a successor paying agent is
8
4289728v1
duly appointed. Principal and interest on the Bonds shall be paid to the registered holders (or
record holders) of the Bonds in the manner set forth in the form of Bond and paragraph 13.
8. Form of Bond. The Bonds, together with the Bond Registrar's Certificate of
Authentication, the form of Assignment and the registration information thereon, shall be in
substantially the following form:
UNITED STATES OF AMERICA
STATE OF MINNESOTA
STEARNS COUNTY
CITY OF ST. JOSEPH
R- $
GENERAL OBLIGATION BOND, SERIES 2011A
Interest Rate Maturity Date Date of Original Issue CUSIP
October 1, November 1, 2011
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The CITY OF ST. JOSEPH, Stearns County, Minnesota (the "Issuer "), certifies that it is
indebted and for value received promises to pay to the registered owner specified above, or
registered assigns, in the manner hereinafter set forth, the principal amount specified above, on
the maturity date specified above, unless called for prepayment, and to pay interest thereon
semiannually on April 1 and October 1 of each year (each, an "Interest Payment Date "),
commencing April 1, 2012, at the rate per annum specified above (calculated on the basis of a
360 -day year of twelve 30 -day months) until the principal sum is paid or has been provided for.
This Bond will bear interest from the most recent Interest Payment Date to which interest has
been paid or, if no interest has been paid, from the date of original issue hereof. The principal of
and premium, if any, on this Bond are payable upon presentation and surrender hereof at the
principal office of Northland Trust Services, Inc., in Minneapolis, Minnesota (the "Bond
Registrar "), acting as paying agent, or any successor paying agent duly appointed by the Issuer.
Interest on this Bond will be paid on each Interest Payment Date by check or draft mailed to the
person in whose name this Bond is registered (the "Holder" or "Bondholder ") on the registration
books of the Issuer maintained by the Bond Registrar and at the address appearing thereon at the
close of business on the fifteenth day of the calendar month of such Interest Payment Date (the
"Regular Record Date "). Any interest not so timely paid shall cease to be payable to the person
who is the Holder hereof as of the Regular Record Date, and shall be payable to the person who
is the Holder hereof at the close of business on a date (the "Special Record Date ") fixed by the
Bond Registrar whenever money becomes available for payment of the defaulted interest.
Notice of the Special Record Date shall be given to Bondholders not less than ten days prior to
the Special Record Date. The principal of and premium, if any, and interest on this Bond are
payable in lawful money of the United States of America. So long as this Bond is registered in
the name of the Depository or its Nominee as provided in the Resolution hereinafter described,
9
4289728v1
and as those terms are defined therein, payment of principal of, premium, if any, and interest on
this Bond and notice with respect thereto shall be made as provided in the Letter of
Representations, as defined in the Resolution, and surrender of this Bond shall not be required
for payment of the redemption price upon a partial redemption of this Bond. Until termination of
the book -entry only District pursuant to the Resolution, Bonds may only be registered in the
name of the Depository or its Nominee.
Optional Redemption. The Bonds of this issue (the "Bonds ") maturing on October 1,
2019, and thereafter, are subject to redemption and prepayment at the option of the Issuer on
October 1, 2018, and on any date thereafter at a price of par plus accrued interest. Redemption
may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the
maturities and the principal amounts within each maturity to be redeemed shall be determined by
the Issuer; and if only part of the Bonds having a common maturity date are called for
prepayment, the specific Bonds to be prepaid shall be chosen by lot by the Bond Registrar.
Bonds or portions thereof called for redemption shall be due and payable on the redemption date,
and interest thereon shall cease to accrue from and after the redemption date. Mailed notice of
redemption shall be given to the paying agent and to each affected Holder of the Bonds prior to
the date fixed for redemption.
Prior to the date on which any Bond or Bonds are directed by the Issuer to be redeemed
in advance of maturity, the Issuer will cause notice of the call thereof for redemption identifying
the Bonds to be redeemed to be mailed to the Bond Registrar and all Bondholders, at the
addresses shown on the Bond Register. All Bonds so called for redemption will cease to bear
interest on the specified redemption date, provided funds for their redemption have been duly
deposited.
Issuance; Purpose; General Obligation. This Bond is one of an issue in the total principal
amount of $2,335,000 (the "Bonds "), all of like date of original issue and tenor, except as to
number, maturity, interest rate, denomination and redemption privilege, issued pursuant to and in
full conformity with the Constitution and laws of the State of Minnesota and pursuant to a
resolution adopted by the City Council on October 6, 2011 (the "Resolution "), for the purpose of
providing funds sufficient for current and crossover advance refundings of certain outstanding
general obligation bonds of the Issuer and to provide funds for public improvements, all within
the jurisdiction of the Issuer. This Bond is payable out of the Escrow Account and the Debt
Service Account of the Issuer's General Obligation Bonds, Series 2011A Fund. This Bond
constitutes a general obligation of the Issuer, and to provide moneys for the prompt and full
payment of its principal, premium, if any, and interest when the same become due, the full faith
and credit and taxing powers of the Issuer have been and are hereby irrevocably pledged.
Denominations; Exchange; Resolution. The Bonds are issuable solely in fully registered
form in Authorized Denominations (as defined in the Resolution) and are exchangeable for fully
registered Bonds of other Authorized Denominations in equal aggregate principal amounts at the
principal office of the Bond Registrar, but only in the manner and subject to the limitations
provided in the Resolution. Reference is hereby made to the Resolution for a description of the
rights and duties of the Bond Registrar. Copies of the Resolution are on file in the principal
office of the Bond Registrar.
10
4289728v1
Transfer. This Bond is transferable by the Holder in person or by the Holder's attorney
duly authorized in writing at the principal office of the Bond Registrar upon presentation and
surrender hereof to the Bond Registrar, all subject to the terms and conditions provided in the
Resolution and to reasonable regulations of the Issuer contained in any agreement with the Bond
Registrar. Thereupon the Issuer shall execute and the Bond Registrar shall authenticate and
deliver, in exchange for this Bond, one or more new fully registered Bonds in the name of the
transferee (but not registered in blank or to "bearer" or similar designation), of an Authorized
Denomination or Denominations, in aggregate principal amount equal to the principal amount of
this Bond, of the same maturity and bearing interest at the same rate.
Fees upon Transfer or Loss. The Bond Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection with the transfer
or exchange of this Bond and any legal or unusual costs regarding transfers and lost Bonds.
Treatment of Registered Owners. The Issuer and Bond Registrar may treat the person in
whose name this Bond is registered as the owner hereof for the purpose of receiving payment as
herein provided and for all other purposes, whether or not this Bond shall be overdue, and neither
the Issuer nor the Bond Registrar shall be affected by notice to the contrary.
Authentication. This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security unless the Certificate of Authentication hereon shall have been executed
by the Bond Registrar.
Qualified Tax - Exempt Obligation. This Bond has been designated by the Issuer as a
"qualified tax - exempt obligation" for purposes of Section 265(b)(3) of the Internal Revenue
Code of 1986, as amended.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things
required by the Constitution and laws of the State of Minnesota to be done, to happen and to be
performed, precedent to and in the issuance of this Bond, have been done, have happened and
have been performed, in regular and due form, time and manner as required by law, and that this
Bond, together with all other debts of the Issuer outstanding on the date of original issue hereof
and the date of its issuance and delivery to the original purchaser, does not exceed any charter,
constitutional or statutory limitation of indebtedness.
IN WITNESS WHEREOF, the City of St. Joseph, Stearns County, Minnesota, by its City
Council has caused this Bond to be executed on its behalf by the facsimile signatures of its
Mayor and its Administrator, the corporate seal of the Issuer having been intentionally omitted as
permitted by law.
11
4289728v1
Date of Registration: Registrable by: NORTHLAND TRUST
SERVICES, INC.
Payable at: NORTHLAND TRUST
SERVICES, INC.
BOND REGISTRAR'S
CERTIFICATE OF CITY OF ST. JOSEPH,
AUTHENTICATION STEARNS COUNTY, MINNESOTA
This Bond is one of the Bonds
described in the Resolution
mentioned within. /s/ Facsimile
Mayor
NORTHLAND TRUST SERVICES,
INC.
Minneapolis, Minnesota /s/ Facsimile
Bond Registrar Administrator
By
Authorized Signature
12
4289728v1
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this Bond, shall
be construed as though they were written out in full according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in common
UTMA - as custodian for
(Cust) (Minor)
under the Uniform Transfers to Minors Act
(State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto the
within Bond and does hereby irrevocably constitute and appoint attorney to transfer
the Bond on the books kept for the registration thereof, with full power of substitution in the
premises.
Dated:
Notice: The assignor's signature to this assignment must
correspond with the name as it appears upon the
face of the within Bond in every particular, without
alteration or any change whatever.
Signature Guaranteed:
Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm
having a membership in one of the major stock exchanges or any other "Eligible Guarantor
Institution" as defined in 17 CFR 240.17 Ad- 15(a)(2).
The Bond Registrar will not effect transfer of this Bond unless the information concerning the
transferee requested below is provided.
Name and Address:
13
4289728v1
PREPAYMENT SCHEDULE
This Bond has been prepaid in part on the date(s) and in the amount(s) as follows:
AUTHORIZED
SIGNATURE
DATE AMOUNT OF HOLDER
14
4289728v1
9. Execution. The Bonds shall be in typewritten form, shall be executed on behalf of
the City by the signatures of its Mayor and Administrator and be sealed with the seal of the City;
provided, as permitted by law, both signatures may be photocopied facsimiles and the corporate
seal has been omitted. In the event of disability or resignation or other absence of either officer,
the Bonds may be signed by the manual or facsimile signature of the officer who may act on
behalf of the absent or disabled officer. In case either officer whose signature or facsimile of
whose signature shall appear on the Bonds shall cease to be such officer before the delivery of
the Bonds, the signature or facsimile shall nevertheless be valid and sufficient for all purposes,
the same as if the officer had remained in office until delivery.
10. Authentication. No Bond shall be valid or obligatory for any purpose or be
entitled to any security or benefit under this resolution unless a Certificate of Authentication on
such Bond, substantially in the form hereinabove set forth, shall have been duly executed by an
authorized representative of the Bond Registrar. Certificates of Authentication on different
Bonds need not be signed by the same person. The Bond Registrar shall authenticate the
signatures of officers of the City on each Bond by execution of the Certificate of Authentication
on the Bond and by inserting as the date of registration in the space provided the date on which
the Bond is authenticated, except that for purposes of delivering the original Bonds to the
Purchaser, the Bond Registrar shall insert as a date of registration the date of original issue of
November 1, 2011. The Certificate of Authentication so executed on each Bond shall be
conclusive evidence that it has been authenticated and delivered under this resolution.
11. Registration; Transfer; Exchange. The City will cause to be kept at the principal
office of the Bond Registrar a bond register in which, subject to such reasonable regulations as
the Bond Registrar may prescribe, the Bond Registrar shall provide for the registration of Bonds
and the registration of transfers of Bonds entitled to be registered or transferred as herein
provided.
Upon surrender for transfer of any Bond at the principal office of the Bond Registrar, the
City shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of
registration (as provided in paragraph 10) of, and deliver, in the name of the designated
transferee or transferees, one or more new Bonds of any Authorized Denomination or
Denominations of a like aggregate principal amount, having the same stated maturity and interest
rate, as requested by the transferor; provided, however, that no Bond may be registered in blank
or in the name of "bearer" or similar designation.
At the option of the Holder, Bonds may be exchanged for Bonds of any Authorized
Denomination or Denominations of a like aggregate principal amount and stated maturity, upon
surrender of the Bonds to be exchanged at the principal office of the Bond Registrar. Whenever
any Bonds are so surrendered for exchange, the City shall execute (if necessary), and the Bond
Registrar shall authenticate, insert the date of registration of, and deliver the Bonds which the
Holder making the exchange is entitled to receive.
All Bonds surrendered upon any exchange or transfer provided for in this resolution shall
be promptly canceled by the Bond Registrar and thereafter disposed of as directed by the City.
15
4289728v1
All Bonds delivered in exchange for or upon transfer of Bonds shall be valid general
obligations of the City evidencing the same debt, and entitled to the same benefits under this
resolution, as the Bonds surrendered for such exchange or transfer.
Every Bond presented or surrendered for transfer or exchange shall be duly endorsed or
be accompanied by a written instrument of transfer, in form satisfactory to the Bond Registrar,
duly executed by the Holder thereof or his, her or its attorney duly authorized in writing.
The Bond Registrar may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection with the transfer or exchange of any Bond and any
legal or unusual costs regarding transfers and lost Bonds.
Transfers shall also be subject to reasonable regulations of the City contained in any
agreement with the Bond Registrar, including regulations which permit the Bond Registrar to
close its transfer books between record dates and payment dates. The Administrator is hereby
authorized to negotiate and execute the terms of said agreement.
12. Rights Upon Transfer or Exchange. Each Bond delivered upon transfer of or in
exchange for or in lieu of any other Bond shall carry all the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Bond.
13. Interest Payment; Record Date. Interest on any Bond shall be paid on each
Interest Payment Date by check or draft mailed to the person in whose name the Bond is
registered (the "Holder ") on the registration books of the City maintained by the Bond Registrar
and at the address appearing thereon at the close of business on the first day of the calendar
month of such Interest Payment Date (the "Regular Record Date "). Any such interest not so
timely paid shall cease to be payable to the person who is the Holder thereof as of the Regular
Record Date, and shall be payable to the person who is the Holder thereof at the close of
business on a date (the "Special Record Date ") fixed by the Bond Registrar whenever money
becomes available for payment of the defaulted interest. Notice of the Special Record Date shall
be given by the Bond Registrar to the Holders not less than ten days prior to the Special Record
Date.
14. Treatment of Registered Owner. The City and Bond Registrar may treat the
person in whose name any Bond is registered as the owner of such Bond for the purpose of
receiving payment of principal of and premium, if any, and interest (subject to the payment
provisions in paragraph 13) on, such Bond and for all other purposes whatsoever whether or not
such Bond shall be overdue, and neither the City nor the Bond Registrar shall be affected by
notice to the contrary.
15. Delivery; Application of Proceeds. The Bonds when so prepared and executed
shall be delivered by the Finance Director to the Purchaser upon receipt of the purchase price,
and the Purchaser shall not be obliged to see to the proper application thereof.
16
4289728v1
16. Funds and Accounts.
(a) There is hereby created a special fund to be designated the "General Obligation
Bonds, Series 2011A Fund" (the "Fund ") to be administered and maintained by the Finance
Director as a bookkeeping account separate and apart from all other funds maintained in the
official financial records of the City. The Fund shall be maintained in the manner herein
specified until all of the Bonds and the interest thereon have been fully paid. There shall be
maintained in the Fund the following accounts:
(i) Payment Account. Proceeds of the Prior Fire Hall Refunding Portion of
the Bonds in the amount of $ shall be deposited in the Payment Account.
This sum is sufficient together with any sums in the debt service fund established for the
Prior Fire Hall Bonds to pay the principal of the Refunded Fire Hall Bonds called for
redemption on the Call Date. Any monies remaining in the Payment Account after
payment of the Refunded Fire Hall Bonds shall be transferred to the Refunded Fire Hall
Debt Service Subaccount. From the Payment Account the Finance Director shall transfer
to the paying agent for Refunded Fire Hall Bonds and the paying agent for Refunded Fire
Hall Bonds shall transfer the Prior Fire Hall Refunding Portion of the Bond proceeds on
the Call Date to the holders of Refunded Fire Hall Bonds.
(ii) Escrow Account. The Escrow Account is established for the Refunded
Improvement Bonds and the Prior Improvement Refunding Portion of the Bonds and
shall be maintained as an escrow account with Northland Trust Services, Inc. (the
"Escrow Agent "), in Minneapolis, Minnesota, which is a suitable financial institution
within or without the State. $ in proceeds of the Bonds shall be
received by the Escrow Agent and applied to fund the Escrow Account or to pay costs of
issuing the Bonds. Proceeds of the Prior Improvement Refunding Portion of the Bonds
less proceeds used to pay costs of issuance or any portion of the Prior Improvement
Refunding Portion of Bond proceeds returned to the City are hereby irrevocably pledged
and appropriated to the Escrow Account, together with all investment earnings thereon.
The Escrow Account shall be invested in securities maturing or callable at the option of
the holder on such dates and bearing interest at such rates as shall be required to provide
sufficient funds, together with any cash or other funds retained in the Escrow Account,
(A) to pay when due the interest to accrue on the Prior Improvement Refunding Portion
of the Bonds to and including the Crossover Date and (B) to pay when called for
redemption on the Crossover Date, the principal amount of the Prior Improvement Bonds.
The Escrow Account shall be irrevocably appropriated to the payment of (A) all interest
on the Prior Improvement Refunding Portion of the Bonds to and including the Crossover
Date and (B) the principal of the Refunded Improvement Bonds due by reason of their
call for redemption on the Crossover Date. The moneys in the Escrow Account shall be
used solely for the purposes herein set forth and for no other purpose, except that any
surplus in the Escrow Account may be remitted to the City, all in accordance with the
Escrow Agreement, by and between the City and Escrow Agent (the "Escrow
Agreement "), a form of which is on file in the office of the Administrator. Any moneys
remitted to the City pursuant to the Escrow Agreement shall be deposited in the Refunded
Improvement Debt Service Subaccount.
17
4289728v1
(iii) Capital Account. To the Capital Account there shall be credited the
proceeds of the sale of the CIP Portion, Equipment Portion, and System Portion of the
Bonds, less a pro rata share of all accrued interest received upon delivery of the Bonds.
From the Capital Account there shall be paid all costs and expenses of the Project,
including the cost of any construction contracts heretofore let and all other costs incurred
and to be incurred of the kind authorized in Minnesota Statutes, Section 475.65.
(iv) Debt Service Account. There shall be maintained the following separate
subaccounts in the Debt Service Account to be designated the "Refunded Fire Hall Debt
Service Subaccount ", the "Refunded Improvement Debt Service Subaccount ", the "CIP
Debt Service Subaccount "; the "Equipment Debt Service Subaccount," and the "System
Debt Service Subaccount." There are hereby irrevocably appropriated and pledged to,
and there shall be credited to the separate subaccounts of the Debt Service Account:
(a) Refunded Fire Hall Debt Service Subaccount. To the Refunded Fire Hall
Debt Service Subaccount are hereby irrevocably appropriated, pledged to and there shall
be credited to: (1) $ of accrued interest received on the Prior Fire Hall
Refunding Portion of the Bonds; (2) any taxes herein or hereafter levied for the payment
of the Prior Fire Hall Refunding Portion of the Bonds; (3) any balance remaining after the
Call Date in the Prior Fire Hall Bonds Debt Service Account created by the Prior Fire
Hall Bonds Resolution; (4) all investment earnings on funds in the Refunded Fire Hall
Debt Service Subaccount; and (5) any and all other moneys which are properly available
and are appropriated by the governing body of the City to the Refunded Fire Hall Debt
Service Subaccount. The amount of any surplus remaining in the Refunded Improvement
Debt Service Subaccount when the Prior Fire Hall Refunding Portion and interest thereon
are paid shall be used consistent with Minnesota Statutes, Section 475.61, Subdivision 4.
(b) Refunded Improvement Debt Service Subaccount. To the Refunded
Improvement Debt Service Subaccount are hereby irrevocably appropriated, pledged to
and there shall be credited to: (1) any balance remaining after the Crossover date in the
Prior Improvement Bonds Debt Service Account created by the Prior Improvement
Bonds Resolution; (2) any uncollected special assessments which were heretofore
pledged for the payment of the Refunded Improvement Bonds and are herein pledged to
the payment of the Prior Improvement Refunding Portion of the Bonds; (3) net revenues
of the System in an annual amount of $30,000, which were heretofore pledged to the
payment of the Refunded Improvement Bonds and are herein pledged to the payment of
the Improvement Refunding Portion of the Bonds; (4) all investment earnings on funds in
the Refunded Improvement Debt Service Subaccount; (5) any taxes herein or hereafter
levied for the payment of the Prior Improvement Refunding Portion of the Bonds; (6) any
sums remitted to the City pursuant to the Escrow Agreement; and (7) any and all other
moneys which are properly available and are appropriated by the governing body of the
City to the Refunded Improvement Debt Service Subaccount. The amount of any surplus
remaining in the Refunded Improvement Debt Service Subaccount when the Prior
Improvement Refunding Portion of the Bonds and interest thereon are paid shall be used
consistent with Minnesota Statutes, Section 475.61, Subdivision 4.
18
4289728v1
(c) CIP Project Debt Service Subaccount. To the CIP Project Debt Service
Subaccount there shall be credited: (1) any taxes herein or hereafter levied for the
payment of the CIP Portion of the Bonds; (2) a pro rata share of all accrued interest
received upon delivery of the Bonds; (3) a pro rata share of all funds remaining in the
Capital Account after completion of the Project and payment of the costs thereof; (4) all
investment earnings on funds held in the CIP Project Debt Service Subaccount; and (5)
any and all other moneys which are properly available and are appropriated by the
governing body of the City to the CIP Project Debt Service Subaccount. The CIP Project
Debt Service Subaccount shall be used solely to pay the principal and interest and any
premium for redemption of the CIP Portion of the Bonds and any other general obligation
bonds of the City hereafter issued by the City and made payable from said subaccount as
provided by law.
(d) Equipment Debt Service Subaccount. To the Equipment Debt Service
Subaccount there shall be credited: (1) collections of all taxes herein or hereinafter levied
for the payment of the Equipment Portion of the Bonds and interest thereon; (2) a pro rata
share of all accrued interest received upon delivery of the Bonds; (3) a pro rata share of
all funds remaining in the Capital Account after payment of the costs of the Equipment;
(4) all investment earnings on funds held in the Equipment Debt Service Subaccount; and
(5) any and all other moneys which are properly available and are appropriated by the
governing body of the City to the Equipment Debt Service Subaccount. The Equipment
Debt Service Subaccount shall be used solely to pay the principal and interest and any
premium for redemption of the Equipment Portion of the Bonds and any other general
obligation bonds of the City hereafter issued by the City and made payable from said
Subaccount as provided by law.
(e) System Debt Service Subaccount. To the System Debt Service
Subaccount there shall be credited: (1) the net revenues of the System not otherwise
pledged and applied to the payment of other obligations of the City, in an amount,
together with other funds which may herein or hereafter from time to time be irrevocably
appropriated to the account sufficient to meet the requirements of Minnesota Statutes,
Section 475.61 for the payment of the principal and interest of the System Portion of the
Bonds; (2) a pro rata share of all accrued interest received upon delivery of the Bonds; (3)
any collections of all taxes which may hereafter be levied in the event the net revenues of
the System and other funds herein pledged to the payment of the principal and interest on
the System Portion of the Bonds are insufficient therefor; (4) a pro rata share of all funds
remaining in the Construction Account after completion of the Project and payment of
the costs thereof; (5) all investment earnings on funds held in the System Debt Service
Subaccount; and (6) any and all other moneys which are properly available and are
appropriated by the governing body of the City to the System Debt Service Subaccount.
The moneys in the System Debt Service Subaccount shall be used solely to pay the
principal of and interest on the System Portion of the Bonds or any other bonds hereafter
issued and made payable from said subaccount as provided by law.
No portion of the proceeds of the Bonds shall be used directly or indirectly to acquire
higher yielding investments or to replace funds which were used directly or indirectly to acquire
higher yielding investments, except (i) for a reasonable temporary period until such proceeds are
19
4289728v1
needed for the purpose for which the Bonds were issued and (ii) in addition to the above in an
amount not greater than the lesser of five percent of the proceeds of the Bonds or $100,000. To
this effect, any proceeds of the Bonds and any sums from time to time held in the Debt Service
Account (or any other City account which will be used to pay principal or interest to become due
on the Bonds), in excess of amounts which under then applicable federal arbitrage regulations
may be invested without regard to yield shall not be invested at a yield in excess of the
applicable yield restrictions imposed by the arbitrage regulations on such investments after
taking into account any applicable "temporary periods" or "minor portion" made available under
the federal arbitrage regulations. Money in the Fund shall not be invested in obligations or
deposits issued by, guaranteed by or insured by the United States or any agency or
instrumentality thereof if and to the extent that such investment would cause the Bonds to be
"federally guaranteed" within the meaning of Section 149(b) of the Internal Revenue Code of
1986, as amended (the "Code ").
17. Covenants Relating to the Prior Fire Hall Refunding Portion of the Bonds.
(a) Tax Levy; Coverage Test; Cancellation of Certain Tax Levies. To provide
moneys for payment of the principal and interest on the Prior Fire Hall Refunding Portion of the
Bonds, there is hereby levied upon all of the taxable property in the City a direct annual ad
valorem tax which shall be spread upon the tax rolls and collected with and as part of other
general property taxes in the City for the years and in the amounts as follows:
Years of Tax Levy Years of Tax Collection Amounts
2011 -2019 2012 -2020 See attached schedule
The tax levies are such that if collected in full they, together with estimated collections of
any other revenues herein pledged for the payment of the Prior Fire Hall Refunding Portion of
the Bonds, will produce at least five percent in excess of the amount needed to meet when due
the principal and interest payments on the Prior Fire Hall Refunding Portion of the Bonds. The
tax levies shall be irrepealable so long as any of the Prior Fire Hall Refunding Portion 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,
Subdivision 3.
(b) General Obligation Pledge. For the prompt and full payment of the principal and
interest on the Prior Fire Hall Refunding Portion of the Bonds, as the same respectively become
due, the full faith, credit and taxing powers of the City shall be and are hereby irrevocably
pledged. If the balance in the Refunded Fire Hall Debt Service Subaccount is ever insufficient to
pay all principal and interest then due on the Prior Fire Hall Refunding Portion of the Bonds and
any other bonds payable therefrom, the deficiency shall be promptly paid out of any other funds
of the City which are available for such purpose, and such other funds may be reimbursed with
or without interest from the Refunded Fire Hall Debt Service Subaccount when a sufficient
balance is available therein.
18. Covenants Relating_to the Prior Improvement Refunding Portion of the Bonds.
20
4289728v1
(a) Special Assessments. The City has heretofore levied special assessments
pursuant to the Prior Improvement Bonds Resolution, which were pledged to the payment of the
principal and interest on the Prior Improvement Bonds the uncollected special assessments for
the Prior Improvement Bonds are now pledged to the payment of principal and interest on the
Prior Improvement Refunding Portion. The special assessments are such that if collected in full
they, together with estimated collections of taxes herein pledged for the payment of the Prior
Improvement Refunding Portion of the Bonds, will produce at least five percent in excess of the
amount needed to meet when due the principal and interest payments on the Prior Improvement
Refunding Portion of the Bonds. The special assessments were levied as provided below,
payable in equal, consecutive, annual installments, with general taxes for the years shown below
and with interest on the declining balance of all such assessments at the rate shown opposite such
years:
Levy Collection
Improvement Designations Amounts Years Years Rate
2006 Street Improvements $1,177,123 2006 -2020 2007 -2021 6.00%
(b) Tax Levy; Coverage Test; Cancellation of Certain Tax Levies. To provide
moneys for payment of the principal and interest on the Prior Improvement Refunding Portion of
the Bonds, there is hereby levied upon all of the taxable property in the City a direct annual ad
valorem tax which shall be spread upon the tax rolls and collected with and as part of other
general property taxes in the City for the years and in the amounts as follows:
Years of Tax Levy Years of Tax Collection Amounts
2011 -2019 2012 -2020 See attached schedule
The tax levies are such that if collected in full they, together with estimated collections of
special assessments and any other revenues herein pledged for the payment of the Prior
Improvement Refunding Portion of the Bonds, will produce at least five percent in excess of the
amount needed to meet when due the principal and interest payments on the Prior Improvement
Refunding Portion of the Bonds. The tax levies shall be irrepealable so long as any of the Prior
Improvement Refunding Portion 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, Subdivision 3.
(c) General Obligation Pledge. For the prompt and full payment of the principal and
interest on the Prior Improvement Refunding Portion of the Bonds, as the same respectively
become due, the full faith, credit and taxing powers of the City shall be and are hereby
irrevocably pledged. If the balance in the Refunded Improvement Debt Service Subaccount is
ever insufficient to pay all principal and interest then due on the Prior Improvement Refunding
Portion of the Bonds and any other bonds payable therefrom, the deficiency shall be promptly
paid out of any other funds of the City which are available for such purpose, and such other
funds may be reimbursed with or without interest from the Refunded Improvement Debt Service
Subaccount when a sufficient balance is available therein.
21
4289728v1
19. Covenants Relating to the CIP Portion of the Bonds.
(a) Tax Levy; Coverage Test. To provide moneys for payment of the principal and
interest on the CIP Portion of the Bonds there is hereby levied upon all of the taxable property in
the City a direct annual ad valorem tax which shall be spread upon the tax rolls and collected
with and as part of other general property taxes in the City for the years and in the amounts as
follows:
Year of Tax Levy Year of Tax Collection Amount
See attached schedule
The tax levies are such that if collected in full they, together with estimated collections of
other revenues herein pledged for the payment of the CIP Portion of the Bonds, will produce at
least five percent (5 %) in excess of the amount needed to meet when due the principal and
interest payments on the CIP Portion of the Bonds. The tax levies shall be irrepealable so long
as any of the CIP Portion 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, Subdivision 3.
(b) General Obligation Pledge. For the prompt and full payment of the principal and
interest on the CIP Portion of the Bonds, as the same respectively become due, the full faith,
credit and taxing powers of the City shall be and are hereby irrevocably pledged. If the balance
in the CIP Project Debt Service Subaccount is ever insufficient to pay all principal and interest
then due on the CIP Portion of the Bonds and any other bonds payable therefrom, the deficiency
shall be promptly paid out of any other funds of the City which are available for such purpose,
and such other funds may be reimbursed with or without interest from the CIP Project Debt
Service Subaccount when a sufficient balance is available therein.
20. Covenants Relating to the Equipment Portion of the Bonds.
(a) Tax Levy Coverage Test. To provide moneys for payment of the principal and
interest on the Equipment Portion of the Bonds there is hereby levied upon all of the taxable
property in the City a direct annual ad valorem tax which shall be spread upon the tax rolls and
collected with and as part of other general property taxes in the City for the years and in the
amounts as follows:
Year of Tax Levy Year of Tax Collection Amount
See attached Schedule
The tax levies are such that if collected in full they will produce at least five percent in
excess of the amount needed to meet when due the principal and interest payments on the
Equipment Portion of the Bonds. The tax levies shall be irrepealable so long as any of the
Equipment 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, Subdivision 3.
22
4289728v1
(b) General Obligation Pledge. For the prompt and full payment of the principal and
interest on the Equipment Portion of the Bonds, as the same respectively become due, the full
faith, credit and taxing powers of the City shall be and are hereby irrevocably pledged. If the
balance in the Equipment Debt Service Subaccount is ever insufficient to pay all principal and
interest then due on the Equipment Portion of the Bonds and any other bonds payable therefrom,
the deficiency shall be promptly paid out of any other funds of the City which are available for
such purpose, and such other funds may be reimbursed with or without interest from the
Equipment Debt Service Subaccount when a sufficient balance is available therein.
21. Covenants Relating to the System Portion of the Bonds.
(a) Excess System Net Revenue. Net revenues in excess of those required for the
foregoing may be used for any proper purpose.
(b) Sufficiency of Net Revenues; Coverage Test. It is hereby found, determined and
declared that the net revenues of the System are sufficient in amount to pay when due the
principal of interest on the System Portion of the Bonds and the Outstanding Bonds and a sum at
least five percent in excess thereof are hereby pledged for the payment of the Bonds on a parity
lien with the Outstanding Bonds and shall be applied for that purpose, but solely to the extent
required to meet the principal and interest requirements of the Bonds as the same become due.
Nothing contained herein shall be deemed to preclude the City from making further
pledges and appropriations of the net revenues of the System for the payment of other or
additional obligations of the City, provided that it has first been determined by the City Council
that the estimated net revenues of the System will be sufficient in addition to all other sources,
for the payment of the System Portion of the Bonds and such additional obligations and any such
pledge and appropriation of the net revenues of the System may be made superior or subordinate
to, or on a parity with the pledge and appropriation herein.
(c) Covenant to Maintain Rates and Charges. In accordance with Minnesota Statutes,
Section 444.075, the City hereby covenants and agrees with the holders of the System Portion of
the Bonds that it will impose and collect charges for the service, use, availability and connection
to the System at the times and in the amounts required to produce net revenues adequate to pay
all principal and interest when due on the System Portion of the Bonds. Minnesota Statutes,
Section 444.075, Subdivision 2, provides as follows: "Real estate tax revenues should be used
only, and then on a temporary basis, to pay general or special obligations when the other
revenues are insufficient to meet the obligations ".
(d) General Obligation Pledge. For the prompt and full payment of the principal and
interest on the System Portion of the Bonds, as the same respectively become due, the full faith,
credit and taxing powers of the City shall be and are hereby irrevocably pledged. If the balance
in the Debt Service Account is ever insufficient to pay all principal and interest then due on the
System Portion of the Bonds and any other bonds payable therefrom, the deficiency shall be
promptly paid out of any other funds of the City which are available for such purpose, and such
other funds may be reimbursed with or without interest from the Debt Service Account when a
sufficient balance is available therein.
23
4289728v1
22. Prior Bonds; Security. Until retirement of the Bonds, all provisions theretofore
made for the security thereof shall be observed by the City and all of its officers and agents.
23. Defeasance. When all Bonds have been discharged as provided in this paragraph,
all pledges, covenants and other rights granted by this resolution to the registered holders of the
Bonds shall, to the extent permitted by law, cease. The City may discharge its obligations with
respect to any Bonds which are due on any date by irrevocably depositing with the Bond
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, it may nevertheless be discharged by depositing with the Bond
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 Bonds called
for redemption on any date when they are prepayable according to their terms, by depositing
with the Bond Registrar on or before that date a sum sufficient for the payment thereof in full,
provided that notice of redemption thereof has been duly given. 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
suitable banking institution qualified by law as an escrow agent for this purpose, cash or
securities described in Minnesota Statutes, Section 475.67, Subdivision 8, bearing interest
payable at such times and at such rates and maturing on such dates as shall be required, without
regard to sale and /or reinvestment, to pay all amounts to become due thereon to maturity or, if
notice of redemption as herein required has been duly provided for, to such earlier redemption
date.
24. Compliance With Reimbursement Bond Regulations. The provisions of this
paragraph are intended to establish and provide for the City's compliance with United States
Treasury Regulations Section 1.150 -2 (the "Reimbursement Regulations ") applicable to the
"reimbursement proceeds" of the Improvements Portion and Street Reconstruction Portion of the
Bonds, being those portions thereof which will be used by the City to reimburse itself for any
expenditure which the City paid or will have paid prior to the Closing Date (a "Reimbursement
Expenditure ").
The City hereby certifies and/or covenants as follows:
24
4289728v1
(a) Not later than sixty days after the date of payment of a Reimbursement
Expenditure, the City (or person designated to do so on behalf of the City) has made or will have
made a written declaration of the City's official intent (a "Declaration ") which effectively (i)
states the City's reasonable expectation to reimburse itself for the payment of the Reimbursement
Expenditure out of the proceeds of a subsequent borrowing; (ii) gives a general and functional
description of the property, project or program to which the Declaration relates and for which the
Reimbursement Expenditure is paid, or identifies a specific fund or account of the City and the
general functional purpose thereof from which the Reimbursement Expenditure was to be paid
(collectively the "Project "); and (iii) states the maximum principal amount of debt expected to be
issued by the City for the purpose of financing the Project; provided, however, that no such
Declaration shall necessarily have been made with respect to: (i) "preliminary expenditures" for
the Project, defined in the Reimbursement Regulations to include engineering or architectural,
surveying and soil testing expenses and similar prefatory costs, which in the aggregate do not
exceed twenty percent of the "issue price" of the CIP Portion and System Portion of the Bonds,
and (ii) a de minimis amount of Reimbursement Expenditures not in excess of the lesser of
$100,000 or five percent of the proceeds of the CIP Portion and System Portion of the Bonds.
(b) Each Reimbursement Expenditure is a capital expenditure or a cost of issuance of
the CIP Portion and System Portion of the Bonds or any of the other types of expenditures
described in Section 1.150- 2(d)(3) of the Reimbursement Regulations.
(c) The "reimbursement allocation" described in the Reimbursement Regulations for
each Reimbursement Expenditure shall and will be made forthwith following (but not prior to)
the issuance of the CIP Portion and System Portion of the Bonds and in all events within the
period ending on the date which is the later of three years after payment of the Reimbursement
Expenditure or one year after the date on which the Project to which the Reimbursement
Expenditure relates is first placed in service.
(d) Each such reimbursement allocation will be made in a writing that evidences the
City's use of CIP Portion and System Portion of the Bond proceeds to reimburse the
Reimbursement Expenditure and, if made within 30 days after the CIP Portion and System
Portion of the Bonds are issued, shall be treated as made on the day the CIP Portion and System
Portion of the Bonds are issued.
Provided, however, that the City may take action contrary to any of the foregoing
covenants in this paragraph upon receipt of an opinion of its Bond Counsel for the CIP Portion
and System Portion of the Bonds stating in effect that such action will not impair the tax - exempt
status of the CIP Portion and System Portion of the Bonds.
25. Securities, Escrow Agent. Securities, if any, purchased from moneys in the
Escrow Account shall be limited to securities set forth in Minnesota Statutes, Section 475.67,
Subdivision 8, and any amendments or supplements thereto. The City Council has investigated
the facts and hereby finds and determines that the Escrow Agent is a suitable financial institution
to act as escrow agent.
25
4289728v1
26. Redemption of Refunded Bonds. The Administrator is hereby authorized and
directed to give mailed notice of redemption prior to the Call Date, to the paying agent for the
Refunded Fire Hall Bonds in substantially the form attached hereto as Exhibit A, which terms
and conditions are hereby approved and incorporated herein by reference. The Refunded
Improvement Bonds shall be redeemed and prepaid on the Crossover Date in accordance with
the terms and conditions set forth in the Notice of Call for Redemption, in substantially the form
attached to the Escrow Agreement, which terms and conditions are hereby approved and
incorporated herein by reference.
27. Escrow Agreement. On or prior to the delivery of the Bonds the Mayor and
Administrator shall, and are hereby authorized and directed to, execute the Escrow Agreement
on behalf of the City. The Escrow Agreement is hereby approved and adopted and made a part
of this resolution, and the City covenants that it will promptly enforce all provisions thereof in
the event of default thereunder by the Escrow Agent.
28. Continuing Disclosure. The City is the sole obligated person with respect to the
Bonds. The City hereby agrees, in accordance with the provisions of Rule 15c2 -12 (the "Rule "),
promulgated by the Securities and Exchange Commission (the "Commission ") pursuant to the
Securities Exchange Act of 1934, as amended, and a Continuing Disclosure Undertaking (the
"Undertaking ") hereinafter described to:
(a) Provide or cause to be provided to the Municipal Securities Rulemaking Board
(the "MSRB ") by filing at www.emma.msrb.org in accordance with the Rule, certain annual
financial information and operating data in accordance with the Undertaking. The City reserves
the right to modify from time to time the terms of the Undertaking as provided therein.
(b) Provide or cause to be provided to the MSRB notice of the occurrence of certain
events with respect to the Bonds in not more than ten (10) business days after the occurrence of
the event, in accordance with the Undertaking.
(c) Provide or cause to be provided to the MSRB notice of a failure by the City to
provide the annual financial information with respect to the City described in the Undertaking, in
not more than ten (10) business days following such amendment.
(d) The City agrees that its covenants pursuant to the Rule set forth in this paragraph
and in the Undertaking is intended to be for the benefit of the Holders of the Bonds and shall be
enforceable on behalf of such Holders; provided that the right to enforce the provisions of these
covenants shall be limited to a right to obtain specific enforcement of the City's obligations under
the covenants.
The Mayor and Administrator of the City, or any other officer of the City authorized to
act in their place (the "Officers ") are hereby authorized and directed to execute on behalf of the
City the Undertaking in substantially the form presented to the City Council subject to such
modifications thereof or additions thereto as are (i) consistent with the requirements under the
Rule, (ii) required by the Purchaser of the Bonds, and (iii) acceptable to the Officers.
26
4289728v1
29. Certificate of Registration. The Administrator is hereby directed to file a certified
copy of this resolution with the County Auditor of Stearns County, Minnesota, together with
such other information as the County Auditor shall require, and to obtain the County Auditor's
Certificate that the Bonds have been entered in the County Auditor's Bond Register and that the
tax levy required by law has been made.
30. Records and Certificates. The officers of the City are hereby authorized and
directed to prepare and furnish to the Purchaser, and to the attorneys approving the legality of the
issuance of the Bonds, certified copies of all proceedings and records of the City relating to the
Bonds and to the financial condition and affairs of the City, and such other affidavits, certificates
and information as are 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
re furnished, shall be deemed representations of the City as to the facts recited therein.
31. Negative Covenant as to Use of Proceeds and Projects. The City hereby
covenants not to use the proceeds of the Bonds or to use the projects originally financed by the
Prior Bonds, or to cause or permit them to be used, or to enter into any deferred payment
arrangements for the cost of the projects, in such a manner as to cause the Bonds to be "private
activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code.
32. Tax - Exempt Status of the Bonds; Rebate. The City shall comply with
requirements necessary under the Code to establish and maintain the exclusion from gross
income under Section 103 of the Code of the interest on the Bonds, including without limitation
(a) requirements relating to temporary periods for investments, (b) limitations on amounts
invested at a yield greater than the yield on the Bonds, and (c) the rebate of excess investment
earnings to the United States, if the Bonds (together with other obligations reasonably expected
to be issued and outstanding at one time in this calendar year) exceed the small issuer exception
amount of $5,000,000.
For purposes of qualifying for the exception to the federal arbitrage rebate requirements
for governmental units issuing $5,000,000 or less of bonds, the City hereby finds, determines and
declares that:
(a) the Bonds are issued by a governmental unit with general taxing powers;
(b) no Bond is a private activity bond;
(c) ninety five percent or more of the net proceeds of the Bonds are to be used for
local governmental activities of the City (or of a governmental unit the jurisdiction of which is
entirely within the jurisdiction of the City);
(d) the aggregate face amount of all tax exempt bonds (other than private activity
bonds) issued by the City (and all subordinate entities thereof, and all entities treated as one
issuer with the City) during the calendar year in which the Bonds are issued and outstanding at
one time is not reasonably expected to exceed $5,000,000, all within the meaning of
Section 148(f)(4)(D) of the Code.
27
4289728v1
(e) with respect to the Prior Fire Hall Refunding Portion of the Bonds there shall not
be taken into account for purposes of said $5,000,000 limit any bond issued to refund (other than
to advance refund) any bond to the extent the amount of the refunding bond does not exceed the
outstanding amount of the refunded bond;
(f) the aggregate face amount of the Bonds does not exceed $5,000,000;
(g) each of the Refunded Fire Hall Bonds and the Refunded Improvement Bonds was
issued as part of an issue which was treated as meeting the rebate requirements by reason of the
exception for governmental units issuing $5,000,000 or less of bonds;
(h) the average maturity of the Prior Fire Hall Refunding Portion of the Bonds does
not exceed the average maturity of the Refunded Fire Hall Bonds;
(i) the average maturity of the Prior Improvement Refunding Portion of the Bonds
does not exceed the average maturity of the Refunded Improvement Bonds;
(j) no part of the Prior Fire Hall Refunding Portion of the Bonds has a maturity date
which is later than the date which is thirty years after the date the Refunded Fire Hall Bonds
were issued; and
(k) no part of the Prior Improvement Refunding Portion of the Bonds has a maturity
date which is later than the date which is thirty years after the date the Refunded Improvement
Bonds were issued.
33. Designation of Qualified Tax - Exempt Obligations. In order to qualify the Bonds
as "qualified tax- exempt obligations" within the meaning of Section 265(b)(3) of the Code, the
City hereby makes the following factual statements and representations:
(a) the Bonds are issued after August 7, 1986;
(b) the Bonds are not "private activity bonds" as defined in Section 141 of the Code;
(c) the City hereby designates the Bonds as "qualified tax - exempt obligations" for
purposes of Section 265(b)(3) of the Code;
(d) the reasonably anticipated amount of tax - exempt obligations (other than private
activity bonds, treating qualified 501(c)(3) bonds as not being private activity bonds) which will
be issued by the City (and all entities treated as one issuer with the City, and all subordinate
entities whose obligations are treated as issued by the City) during this calendar year 2011 will
not exceed $10,000,000;
(e) not more than $10,000,000 of obligations issued by the City during this calendar
year 2011 have been designated for purposes of Section 265(b)(3) of the Code; and
(f) the aggregate face amount of the Bonds does not exceed $10,000,000.
Furthermore, with respect to the Prior Fire Hall Refunding Portion of the Bonds:
28
4289728v1
(g) each of the Refunded Fire Hall Bonds and was designated as a "qualified tax
exempt obligation" for purposes of Section 265(b)(3) of the Code;
(h) the average maturity of the Prior Fire Hall Refunding Portion of the Bonds does
not exceed the remaining average maturity of the Refunded Fire Hall Bonds;
(i) no part of the Prior Fire Hall Refunding Portion of the Bonds has a maturity date
which is later than the date which is thirty years after the date the Refunded Fire Hall Bonds
were issued; and
(j) the Prior Fire Hall Refunding Portion of the Bonds are issued to refund, and not to
"advance refund" the Prior Fire Hall Bonds within the meaning of Section 149(d)(5) of the Code,
and shall not be taken into account under the $10,000,000 issuance limit to the extent the Prior
Fire Hall Refunding Portion does not exceed the outstanding amount of the Prior Fire Hall
Bonds.
The City shall use its best efforts to comply with any federal procedural requirements which may
apply in order to effectuate the designation made by this paragraph.
34. Official Statement. The Official Statement relating to the Bonds prepared and
distributed by the Purchaser is hereby approved and the officers of the City are authorized in
connection with the delivery of the Bonds to sign such certificates as may be necessary with
respect to the completeness and accuracy of the Official Statement.
35. Supplemental Resolution. The Prior Resolutions are hereby supplemented to the
extent necessary to give effect to the provisions hereof.
36. Payment of Issuance Expenses. The City authorizes the Purchaser to forward the
amount of Bond proceeds allocable to the payment of issuance expenses to the Escrow Agent on
the closing date for further distribution as directed by the Purchaser.
37. Severability. If any section, paragraph or provision of this resolution shall be held
to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section,
paragraph or provision shall not affect any of the remaining provisions of this resolution.
38. Headings. Headings in this resolution are included for convenience of reference
only and are not a part hereof, and shall not limit or define the meaning of any provision hereof.
29
4289728v1
EXHIBIT A
NOTICE OF CALL FOR REDEMPTION
GENERAL OBLIGATION FIRE HALL CROSSOVER REFUNDING BONDS OF 2003
CITY OF ST. JOSEPH, STEARNS COUNTY, MINNESOTA
NOTICE IS HEREBY GIVEN that by order of the City Council of the City of St. Joseph,
Stearns County, Minnesota, there have been called for redemption and prepayment on
December 1, 2011
those outstanding bonds of the City designated as General Obligation Fire Hall Crossover
Refunding Bonds of 2003, dated as of July 1, 2003, having stated maturity dates, in the years
2013 through 2017, and totaling $430,000 in principal amount and having CUSIP numbers listed
below:
Year CUSIP Number*
2013 790739 NM4
2015 790739 NP7
2017 790739 NR3
The bonds are being called at a price of par plus accrued interest to December 1, 2011, on which
date all interest on the bonds will cease to accrue. Holders of the bonds hereby called for
redemption are requested to present their bonds for payment at U.S. Bank National Association,
Attention: Paying Agent Services, 60 Livingston Avenue, St. Paul, Minnesota 55107.
Dated: October 6, 2011 BY ORDER OF THE CITY COUNCIL
/s/ Judy Weyrens, City Administrator
*The City shall not be responsible for the selection of or use of the CUSIP numbers, nor is any
representation made as to their correctness indicated in the notice. They are included solely for
the convenience of the holders.
A -1
4289728v1
MOODY'S ASSIGNS Al RATING TO THE CITY OF ST. JOSEPH (MN) $2.3 MILLION GO BONDS, SERIES 2011A
Al RATING APPLIES TO $11.2 MILLION OF MOODY'S RATED POST SALE GO DEBT
Moody's Investors Service has assigned an Al rating to the City of St. Joseph's (MN) $2.32 million General
Obligation Bonds, Series 2011A. Concurrently, Moody's has affirmed the Al rating on the city's outstanding general
obligation debt. Post -sale, the city will have $17.4 million of outstanding general obligation debt, of which $11.2
million is rated by Moody's.
SUMMARY RATING RATIONALE
The bonds, secured by the city's general obligation unlimited tax pledge, will finance various capital improvements
within the city. Additionally, debt service on the bonds are payable from special assessments against all benefiting
properties. The Al rating reflects the city's modest, tax base that benefits from institutional presence, strong
operating reserves that provide substantial cushion for contingencies, and a high, yet manageable debt burden.
STRENGTHS
- Institutional presence of the College of Saint Benedict (St. Benedict) and its proximity to St. Cloud, MN
- Satisfactory financial operations characterized by a strong management team and ample reserve levels
CHALLENGES
- Small tax base with declining property values
- Relatively high debt burden
DETAILED CREDIT DISCUSSION
MODESTLY SIZED TAX BASE; SIGNIFICANT UNIVERSITY POPULATION PRESENCE
The City of St. Joseph is located five miles west of St. Cloud (GO rated Aa2) within Steams County (Aa2). Previously,
the city's $317 million tax base had increased at a rapid annual average rate of 15% from 2002 through 2007 and
remained stable from 2008 -2009. In contrast, the city's full valuation experienced a significant 11.3% decrease in
2010 slowing the average annual rate of growth to 3.6% over the past five years. New construction significantly
slowed in 2010 which resulted in the precipitous decline. Steams County projects only a lesser 2% decrease in 2011.
The city continues to benefit from the presence of St. Benedict's College (revenue rated Baal) and proximity to St.
Cloud which continues to spur development, although at a more moderate pace. The 2010 population, 6,534, reflects
a 40% increase from 2000. The 2,000 students of St. Benedict's make up approximately 30% of the city's population.
The sister campus of St. John's University is located just three miles away in Collegeville. The presence of the
college has also spurred various developments including a grocery store which is now the second largest employer in
the city with 125 employees. In addition, the college continues to expand and spur ancillary development. The
college has plans to expand and will add a new student center, residential and other facilities. In addition to
expansion of college facilities, the city anticipates residential developments to occur in the vicinity of the college.
Another significant development is the construction of a new 40,000 square foot permanent US Army reserve training
facility for approximately 200 army reservists. The facility is expected to be built and completed by 2013. The
presence of the students impacts the median age for the city, which is 21 compared to the national median age of
35.3. Additionally, socioeconomic indicators are negatively skewed as the per capita and median family incomes
were just 51.8% and 78.7% of the state, respectively.
SATISFACTORY FINANCIAL OPERATIONS WITH HEALTHY RESERVE LEVELS
The city's financial operations are expected to remain stable due to healthy reserves and prudent management
strategies. The city's General Fund has posted annual operating surpluses with the exception of fiscal 2008 due to
an unexpected unalottment of local govemment aid (LGA) from the state just a few days prior to the end of the fiscal
year. The total fund balance rose from $922,000 (39.1% of revenues) in fiscal 2006 to nearly $1.7 million in 2010
which was a strong 63.2% of General Fund revenues. The city has a formal reserve policy which is to maintain 4 -6
months of expenditures in reserves. Currently, $900,000 of the $1.7 million is designated for working capital which is
well over the city's formal reserve policy. The city anticipates a slight surplus in fiscal 2011 and balanced operations
in 2012 with no significant increase in spending. The majority of operating revenue is derived from property taxes
(45.2 %) and intergovernmental aid (30.2 %). The city continues to budget conservatively and had planned for the
state aid reductions in fiscal years 2011 and 2012 similar to 2010 levels. In previous years, the city was more
dependent on economically sensitive revenues including charges for services and licenses and permits. In fiscal 2007,
these revenues comprised 24% of operating revenues compared to a much lesser 12% in fiscal 2010. Notably, these
revenues are expected to turn around as the College continues with their master plan which involves several phases
of construction totaling nearly $125 million. In addition, beginning fiscal 2012, the city is no longer subject to state
imposed operating levy limits giving the city significant operating flexibility.
The city also benefits from a regional sales tax of 0.5% which revenues are shared with the City of St. Cloud. The
proceeds of this sales tax can be used for capital expenditures such as parks, transportation and infrastructure. The
sales tax fund currently contains $1.1 million. While proceeds are restricted to capital needs, the revenues help offset
capital expenditure pressures in the General Fund.
HIGH YET MANAGEABLE DEBT BURDEN WITH RAPID PRINCIPAL AMORTIZATION
We believe the city's debt burden, at 6.4% (direct 5.6 %), will remain high but manageable primarily due to lack of
significant borrowing plans and additional support available from non -levy sources. Nearly 45% of the city's direct
debt is funded from water and sewer utility revenues and special assessments. Currently, operating revenues of the
utility funds are insufficient to cover expenditures in those funds. However, the funds have had significant reserves
that have been used to pay debt service payments. Additionally, principal amortization is rapid with 83% retired in ten
years. Officials do not have any plans for additional borrowings in the near term, but may issue for its utility
improvements in 2013 or beyond. All of the city's debt is fixed rate and the city is not a party to any interest rate swap
agreements.
WHAT COULD MOVE THE RATING UP
- Significant expansion of city's tax base
WHAT COULD MOVE THE RATING DOWN
- Significant declines to the city's General Fund reserves and available liquidity
- Continued declines to the city's full valuation to below similarly rated entities
KEY STATISTICS
2010 U.S. Census population: 6,534
2010 full value: $317 million
Full value per capita: $48,381
1999 Median family income: $44,737 (78.7% of state)
1999 Per capita income: $12,011 (51.8% of state)
2000 Median housing value: $93,800 (76.6% of state)
Overall debt burden: 6.4%
Direct debt burden: 5.6%
Principal amortization rate (10 years): 98.3%
Fiscal 2010 General Fund balance: $1.7 million (63.2% of General Fund revenues)
Post -sale general obligation debt, including current issue: $17.4 million
Post -sale Moody's rated general obligation debt, including current issue: $11.2 million
THIS PAGE INTENTIONALLY LEFT BLANK
Final
� City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011A
Project Summary
Dated 11/01l2011 � Delivered 11N0I2011
Vssue
2003 Ref Certificates Sewer 2006 Ref CIP Summary
Sources Of Funds
ParAmountofBonds $430,000.00 $390,000.00 $225,000.00 $1,040,000.00 $195,000.00 $2,280,000.00
Transfers from Prior Issue Debt Service Funds 437,500.OQ 437,5�0.0�
Reoffering Premium 12 662.95 7 326.70 4,071.35 19,050.00 3,779.10 46,890.10
Accrued Interestfrom 11/01/2011 to 11I10I2011 215.00 20'1.50 116.25 540.75 100.50 1,174.00
Total Sources 3442,877.95 $397,528.20 5229,187.60 51,497,090.75 $198,879.60 52,765,564.10
Uses Of Funds
Deposit to Crossover Escrow Fund 430 000.00 - 1,468,731.57 1,898,731.57
Deposit to Proiect Constrtiction Fund - 383,463.00 223,000.00 - 188,417.00 794,880.00
Total Underwrite�'s Discount 1.700% 7,310.00 6,630.00 3,825.00 17,680.00 3,315.00 38,760.00
Costs of Issuance 4,528.21 4,106.98 2,369.41 10,951.92 2,053.48 24,010.00
Deposit to Capitalized Interest (CIF) Fund 5 171.83 - 2 579.50 7,751.33
Rounding Amount 824.74 (2 045.11) (123.06) (272.74) 2,414.12 797.95
Deposit to Debt Service Fund 215.00 201.50 116.25 - 100.50 633.25
Total Uses 5442,877.95 E387,528.20 E229,187.60 57,497,090.75 5798,879.60 52,785,584.10
Flow of Funds Detail �
State and Local Govemment Series (SLGS) rates for 10/05/2011
Date of OMP Candidates
Primary Purpose Fund Solutwn Method Net Funded Net Funded Net Funded Net Funded Net Funded Net Funded
Total Cost of Investments $430,000.00 $383,463.00 $223,000.00 $1,468,731.57 $188,417.00 $2,693,611.57
Interest Eamings � 0.257% 5,516.23 - 5,516.23
Transfers from Unrestricted Money Fund - 439,709.70 439,709.70
Total Draws $430,000.00 $383,463.00 $223,000.00 $1,476,457.50 $188,417.00 $2,701,337.50
Unrestricted Money Fund Solution Method Transfer All Transfer All Transfer All Transfer All Transfer All Transfer All
Total Cost of Investments - $437,500.00 - $437,500.00
Interest Eaminqs Q 0.255% 2,209.70 2,209.70
Transfers to Primary Purpose Fund - (439,709.70) (439,709.70)
Capitalized Interest Fund Solution Method Net Funded Net Funded Net Funded Net Funded Net Funded Net �unded
Original Bond Proceeds - 5,171.83 - 2,579.50 7,751.33
Accrued Interest 201.50 - 100.50 302.00
Total Draws $5,373.33 $2,680.00 $8,053.33
PV Analysis Summary �Net to Net)
Net PV Cashflow Savings @ 1.709%(Bond Yield) 31,859.83 - 515,214.25 -
Accrued Interest Credit to Debt Service Fund 215.00
Transfers from Prior Issue Debt Service Fund (437,500.00) -
ConHngency or Rounding Amount 824.74 - (272.74) - -
Net Present Value Benefit $32,899.57 - $77,441.51 - -
Net PV Benefit / - Refunded Principal ' 7.651 % 5.397% - -
Net PV Benefit I - Refunding Principal 7.651 % 7.446% - -
Bond Statistics
Average Life 3.463 Years 5.609 Years 5.694 Years 6.522 Years 5.532 Years 5.623 Years
Averaae Coupon 1.9999998% 2.1142094% 2.1121951% 2.1173587% 2.1066049% 2.1017680%
Net Interest Cost (NIC) 1.6405403% 2.0823602% 2.0929678% 2.0971622% 2.0635829% 2.0383507%
Bond Yield for Arbitrage Purposes 1.7089022% 1.7069022%a 1.7089022% 1.7089022% 1.7089022% 1.7089022%
True Interest Cost (TIC) 1.6238325% 2.0770322% 2.0888066% 2.0929056% 2.0575181 % 2.0307759%
All InclusiVe Cost (AIC) 1.9417267% 2.2816432% 22906505% 2.2692747°/a 2.2645485% 2.2338973%
Ref 3 � Issue Summery � 10/6/2011 I 9:09 AM
Northland Securities
Public Finance Page t
Final
� City of Saint Joseph, Minnesota
G.O. Bonds, Series 201 lA
Debt 5ervice Schedule
D.ate Principat Coupon Interest Total P+I Fiscal Total
11 /10/2011 - - - - -
04/01l2012 - - 19,566.66 19,566.66 -
10/01/2012 140,000.00 2.000% 23,480.00 163,480.00 -
12/01I2012 - - - - 183,046.66
04/01/2013 - - 22,080.00 22,080.00 -
10/01/2013 145,000.00 2.000% 22,080.00 167,080.00 -
12/01/2013 - - - - 189,160.00
04/01l2014 - - 20,630.00 20,630.00 -
10/01/2014 265,000.00 2.000% 20,630.00 285,630.00 -
12/01/2014 - - - - 306,260.00
04/01/2015 - - 17,980.00 17,980.00 -
10/01/2015 275,000.00 2.000% 17,980.00 292,980.00 -
12/01/2015 - - - - 310,960.00
04/01/2016 - - 15,230.00 15,230.00 -
10/01/2016 280,000.00 2.000% 15,230.00 295,230.00 -
12/01/2016 - - - - 310,460.00
04/01/2017 - - 12,430.00 12,430.00 -
10/01/2017 290,000.00 2.000% 12,430.00 302,430.00 -
12/01/2017 - - - - 314,860.00
04/01/2018 - - 9,530.00 9,530.00 -
10/01/2018 215,000.00 2.000% 9,530.00 224,530.00 -
12/01 /2018 - - - - 234,060.00
04/01/2019 - - 7,380.00 7,380.00 -
10/01/2019 220,000.00 2.000% 7,380.00 227,380.00 -
12/01/2019 - - - - 234,760.00
04/01 /2020 - - 5,180.00 5,180.00 -
10/01/2020 220,000.00 2.200% 5,180.00 225,180.00 -
12/01/2020 - - - - 230,360.00
04/01I2021 - - 2,760.00 2,760.00 -
10/01/2021 230,000.00 2.400% 2,760.00 232,760.00 -
12/01/2021 - - - - 235,520.00
Total $2,280,000.00 - $269,446.66 $2,549,446.66 -
Dated 11 /01 /2011
Delivery Date 11/10/2011
First Coupon Date 4/01/2012
First available call date 10/01/2018
Call Price 100.0000000%
Accrued Interestfrom 11/01/2011 to 11/10/2011 1,174.00
Bond Year pollars $12,820.00
Average Life 5.623 Years
Average Coupon 2.1017680%
Net Interest Cost (NIC) 2.0383507%
True Interest Cost (TIC) 2.0307759%
Bond Yield for Arbitrage Purposes 1.7089022%
Net Interest Cost 1.7006377%
Weighted Average Maturity 5.594 Years
Ret 3� Issue Summary { 10! 6l2011 � 9:09 AM
Northland Securities
Public Finance Page 2
Final
City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011A
Pricing Summary
Maturity
Maturity Type of Bond Coupon Yield Value Price Dollar Price
10I0112612 Serial Coupon 2.000°Io 0.400% 140,000.00 101.422°!0 141,990.80
10/01/2013 Serial Coupon 2.000% 0.600% 145,000.00 102.629% 148,812.05
10/01/2014 Serial Coupon 2.000% 0.800% 265,000.00 103.423% 274,070.95
10/01l2015 Serial Coupon 2.000% 1.000% 275,000.00 103.807% 285,469.25
10/01/2016 Serial Coupon 2.000% 1.250% 280,000.00 103.547% 289,931.60
10/01/2017 Serial Coupon 2.000% 1.500% 290,000.00 102.808% 298,143.20
10l01l2018 Seria4 Coupon 2.000% 1.750°l0 215,000.00 101.615°Jo 218,472.25
10l01/2019 Serial Coupon 2.000% 2.000% 220,000.00 100.000% 220,000.00
10/01/2020 Serial Coupon 2.200% 2.200% 220,000.00 100.000% 220,000.00
10/ 01l2021 Se ri a l Coupon 2.400% 2.400% 230,000.00 100.000% 230,000.00
Total - - - $2,280,000.00 - $2,326,890.10
Dated 11 /01/2011
Delivery Date 11/10/2011
First Coupon Date 4l01/2012
First available call date 10/01/2018
Cali Price 100.0000000%
Par Amount of Bonds $2,280,000.00
Reoffering Premium or (Discount) 46,890.10
Gross Production $2,326,890.10
Total Underwriter's Discount (1.700%) $(38,760.00)
Bid (100.357%) 2,288,130.10
Accrued Interestfrom 11/01/2011 to 11l10/2011 1,174.00
Total Purchase Price $2,289,304.10
Bond Year pol4ars $12,820.00
Average Life 5.623 Years
Average Coupon 2.1017680%
Net Interest Cost (NIC) 2.0383507%
True Interest Cost (TIC) 2.0307759%
Ref 3( Issue Summary � 10! 6/2011 � 9:09 AM
Northland Securities
Public Finance Page 3
Final
City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011A
Detail Costs Of Issuance
Dated 1110112011 � Delivered 11/1012011
COSTS OF ISSUANCE DETAIL
Bond Counsel $10,000.00
Rating Agency Fee $8,000.00
Pricing Opinion $1,500.00
Registrar / Paying Agent $1,175.00
Escrow Agent $1,150.00
CPA / Verification $2,000.00
County Auditor $185.00
TOTAL $24,070.00
Ref 3 � Issue Summary � 10/ 6I2011 � 9:09 AM
Northland Securities
Public Finance Paye 4
Final
City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011A
2003 Refunding
Debt Service Comparison
Existing Net New
Date Total P+� D!S D/S Old Net D/S Savings
12/01/2011 - 69,562.50 68,522.76 69,562.50 1,039.74
12/01/2012 77,883.33 - 77,883.33 82,235.00 4,351.67
12/01/2013 77,200.00 - 77,200.00 79,927.50 2,727.5Q
12/01/2014 75,800.00 - 75,800.00 82,620.00 6,820.00
12/01/2015 74,400.00 - 74,400.00 84,820.00 10,420.00
12/01/2016 78,000.00 - 78,000.00 81,820.00 3,820.00
12/01/2017 7 6,500. 0 0 - 76,500.00 83,520.00 7,020.00
Total $459,783.33 $69,562.50 $528,306.09 $564,505.00 536,198.91
PV Analysis Summary (Net to Net)
Gross PV Debt Service Savings ..................... 31,859.83
Net PV Cashflow Savings @ 1.709%(Bond Yield)..... 31,859.83
Accrued Interest Credit to Debt Service Fund...... 215.00
Contingency or Rounding Amount .................... 824.74
Net Present Value Benefit $32,899.57
Net PV Benefit /$466,209.41 PV Refunded Debt Service 7.057%
Net PV Benefit /$430,000 Refunded Principal... 7.651 %
Net PV Benefit /$430,000 Refunding Principal.. 7.651 %
Refunding Bond Information
Refunding Dated Date 11/01/2011
Refunding Delivery Date 11/10/2011
Ref 3 � 2003 Ref � 10/ 6/2011 � 9:09 AM
Northland Securities
Public Finance Page 5
Final
City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011 A
2003 Refunding
Debt Service Schedule
Date Principal Coupon Interest Total P+I Fiscal Total
11 /10/2011 - - - - -
04/01/2012 - - 3,583.33 3,583.33 -
10/01/2012 70,000.00 2.000% 4,300.00 74,300.00 -
12/01/2012 - - - - 77,883.33
04/01/2013 - - 3,600.00 3,600.00 -
10/01l2013 70,000.00 2.000% 3,600.00 73,600.00 -
12/01/2013 - - - - 77,200.00
04/01/2014 - - 2,900.00 2,900.00 -
10/01/2014 70,000.00 2.000% 2,900.00 72,900.00 -
12/01/2014 - - - - 75,800.00
04/01/2015 - - 2,200.00 2,200.00 -
10/01/2015 70,000.00 2.000°/a 2,200.00 72,200.00 -
12/01/2015 - - - - 74,400.00
04/01/2016 - - 1,500.00 1,500.00 -
10/01/2016 75,000.00 2.000% 1,500.00 76,500.00 -
12/01/2016 - - - - 78,000.00
04/01/2017 - - 750.00 750.00 -
10/01/2017 75,000.00 2.000% 750.00 75,750.00 -
12/01/2017 - - - - 76,500.00
Total $430,000.00 - $29,783.33 $459,783.33 -
Dated 11I01 /2011
Delivery Date 11/10/2011
First Coupon Date 4/01/2012
First available call date 10/01/2018
Call Price 100.0000000%
Accrued Interestfrom 11I01J2011 to 11i10i2011 215.00
Bond Year pollars $1,489.17
Average Life 3.463 Years
Average Coupon 1.9999998%
Net Interest Cost (NIC) 1.6405403%
True Interest Cost (TIC) 1.6238325%
Bond Yield for Arbitrage Purposes 1.7089022%
Net Interest Cost 1.1002006%
Weighted Average Maturity 3.471 Years
Ref 3 � 2003 Ref � 10/ 6/2017 � 9:09 AM
Northland Securities
Public Finance Pa9e s
Final
` City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011 A
New Money Certificates
Debt Service Schedule
Date Principal Coupon Interest Total P+I Fiscal Total
11 /10/2011 - - - - '
04/01/2012 - - 3,358.33 3,358.33 -
10/01/2012 35,000.00 2.000% 4,030.00 39,030.00 -
12/01/2012 - - - - 42,388.33
04/01/2013 - - 3,680.00 3,680.00 -
10/01/2013 35,000.00 2.000% 3,680.00 38,680.00 -
12/01/2013 - - - - 42,36�.00
04/01/2014 - - 3,330.00 3,330.00 -
10/01/2014 35,000.00 2.000% 3,330.00 38,330.00 -
12/01/2014 - - - - 41,660.00
04/01/2015 - - 2,980.00 2,980.00 -
10/01/2015 40,000.00 2.000% 2,980.00 42,980.00 -
12/01/2015 - - - - 45,960.00
04/01/2016 - - 2,580.00 2,580.00 -
10/01/2016 40,000.00 2.000% 2,580.00 42,580.00 -
12/01/2016 - - - - 45,160.00
04/01/2017 - - 2,180.00 2,180.00 -
10/07/2017 40,000.00 2.000% 2,180.00 42,180.00
12/01/2017 - - - - 44,360.00
04/01/2018 - - 1,780.00 1,780.00 -
10/01/2018 40,000.00 2.000% 1,780.00 41,780.00 -
12l01/2018 - - - - 43,560.00
04/01 /2019 - - 1,380.00 1,380.00 -
10/01/2019 4Q,000.00 2.000% 1,380.00 41,380.00 -
12/01/2019 - - - - 42,760.00
04/01/2020 - - 980.00 980.00 -
10/01/2020 40,000.00 2.200% 980.00 40,980.00 -
12t01/2020 - - - - 41,960.00
04/01/2021 - - 540.00 540.00 -
10/01/2021 45,000.00 2.400% 540.00 45,540.00 -
1 - - - - 46,080.00
Total $390,000.00 - $46,248.33 $436,248.33 -
Dated 11 /01 /2011
Delivery Date 11/10/2011
First Coupon Date 4l01/2012
First available call date 10/01/2018
Call Price 100.0000000%
Accrued Interest from 11/01/2011 to 11/10/2011 201.50
Bond Year pollars $2,187.50
Average Life 5.609 Years
Average Coupon 2.1142094%
Net interest Cost (NIC) 2.08236Q2%
True Interest Cost (TIC) 2.0770322%
Bond Yield for Arbitrage Purposes 1.7089022°/a
Net Interest Cost 1.7462991 %
Weighted Average Maturity 5.580 Years
Ref 3 � Cert'rficates � 10/ 6/2011 � 9:09 AM
Northland Securities
Public Finance Pa9e �
Final
City of Saint Joseph, Minnesota
G.O. Bonds, Series 201 lA
New Money Sewer �
Debt Service Schedule
Date Principal Coupon Interest Total P+I Fiscal Total
11/TO/2011 - - - - '
04/01/2012 - - 1,937.50 1,937.50 -
10/01/2012 20,000.00 2.000% 2,325.00 22,325.00 -
12/01/2012 - - - - 24,262.50
04/01/2013 - 2,125.00 2,125.00 -
10/01/2013 20,000.00 2.000% 2,125.00 22,125.00 -
12/01/2013 - - - - 24,250.00
04/01/2014 - - 1,925.00 1,925.00 -
10/01l2014 20,000.00 2.000% 1,925.00 21,925.00 -
12/01/2014 - - - - 23,850.00
04/01/2015 - - 1,725.00 1,725.00 -
10/01/2015 20,000.00 2.000% 1,725.00 21,725.00 -
12/01/2015 - - - - 23,450.00
04/01/2016 - - 1,525.00 1,525.00 -
10/01/2016 20,000.00 2.000°/a 1,525.00 21,525.00 -
12/01/2016 - - - - 23,050.00
04/01/2017 - - 1,325.00 1,325.00 -
10/01/2017 25,000.00 2.000°/a 1,325.00 26,325.00 -
12/01/2017 - - - - 27,650.00
04/01/2018 - - 1,075.00 1,075.00 -
10/01/2018 25,000.00 2.000% 1,075.00. 26,075.00 -
12/01/2018 - - - - 27,150.00
04/01/2019 - - 825.00 825.00 -
10/01/2019 25,000.00 2.000% 825.00 25,825.00 -
12/01/2019 - - - - 26,650.00
04/01/2020 - - 575.00 575.00 -
10/01/2020 25,000.00 2.200% 575.00 25,575.00 -
12/01/2020 - - - - 26,150.00
04/01 /2021 - - 300.00 300.00 -
10/01/2021 25,000.00 2.400% 300.00 25,300.00 -
12/01/2021 - - - - 25,600.00
Total $225,000.00 - $27,062.50 $252,062.50 -
Dated 11 /01 /2011
Delivery Date 11/10/2011
First Coupon Date 4/01/2012
First available call date 10/01/2D18
Call Price 100.0000000%
Accrued Interest from 11/01/2011 to 11/10/2011 116.25
Bond Year pollars $1,281.25
Average Life 5.694 Years
Average Coupon 2.1121951%
Net Interest Cost (NIC) 2.0929678%
True Interest Cost (TIC) 2.0888066%
Bond Yield for Arbitrage Purposes 1.7089022%
Net Interest Cost 1.7624121%
Weighted Average Maturity 5.666 Years
Ref 3 � Sewer � 10/ 6/2011 � 9:09 AM
Northland Securities
Public Finance Pa9e $
Final
City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011A
2006 Refunding
Debt Service Comparison
Date Total P+I PCF Existing D/S Net New D/S Old Net D/S Savings
12/01l2011 - - 173,584.38 173,857.12 (263,915.62) (437,772.74)
12/01/2012 19,827.50 (19,827.50) 216,768.76 216,768.76 216,768.76 -
12/01/2013 21,630.00 (1,456,630.00) 1,650,968.76 215,968.76 215,968.76 0.00
12/01/2014 141,630.00 - - 141,630.00 214,968.76 73,338.76
12/01/2015 144,230.00 - - 144,230.00 213,768.76 69,538.76
12/01/2016 141,730.00 - - 141,730.00 217,168.76 75,438.76
12/01/2017 144,230.00 - - 144,230.00 215,156.26 70,926.26
12/01/2018 141,630.00 - - 141,630.00 212,937.50 71,307.50
12/01/2019 144,030.00 - - 144,030.00 215,287.50 71,257.50
12/01/2020 141,330.00 - - 141,330.00 217,212.50 75,882.50
12/01/2021 1 - - 143,360.00 213,712.50 70,352.50
Total $1,183,627.50 (1,476,457.50) $2,041,321.90 $1,748,764.64 $1,889,034.44 $140,269.80
PV Analysis Summary (Net to 1Vet)
Gross PV Debt Service Savings ..................... 515,214.25
Net PV Cashflow Savings @ 1.709%(Bond Yield)..... 515,214.25
Transfers from Prior Issue Debt Service Fund...... (437,500.00)
Contingency or Rounding Amount .................... �272•�4)
Net Present Value Benefit $77,441.51
Net PV Benefit /$1,540,837.65 PV Refunded Debt Service 5.026%
Net PV Benefit /$1,435,000 Refunded Principal... 5.397%
Net PV Benefit /$1,040,000 Refunding Principal.. 7.446%
Refunding Bond Information
Refunding Dated Date 11/01/2011
Refunding Delivery Date 11/10/2011
Ref 3 � 2006 Ref � 10/ 6/2011 � 9:09 AM
Northland Securities
Public Finance Page 9
Final
� City of Saint Joseph, Minnesota
G.O. Bonds, Seriea 2011A
2006 Refunding
Debt Service Schedule
Date Principal Coupon Interest Total P+1 Fiscal Total
11 /10/2011 - - - - -
04/01/2012 - - 9,012.50 9,012.50 -
10/01/2012 - - 10,815.00 10,815.00 -
12/01/2012 - - - - 19,827.50
04/01/2013 - - 10,815.00 10,815.00 -
10/01/2013 - - 10,815.00 10,815.00 -
12/01 /2013 - - - - 21,630.00
04/01/2014 - - 10,815.00 10,815.00 -
10/01/2014 120,000.00 2.000% 10,815.00 130,815.00 -
12/01/2014 - - - - 141,630.00
04/01/2015 - - 9,615.00 9,615.00 -
10/01/2015 125,000.00 2.000% 9,615.00 134,615.00 -
12/01/2015 - - - - 744,230.00
04/01/2016 - - 8,365.00 8,365.00 -
10/01/2016 125,000.00 2.000% 8,365.00 133,365.00 -
12/01 /2016 - - - - 141,730.00
04/01 /2017 - - 7,115.00 7,115.00 -
10/01/2017 130,000.00 2.000% 7,115.00 137,115.00 -
92/01/2017 - - - - 144,230.00
04/01/2018 - - 5,815.00 5,815.00 -
10l01/2018 130,000.00 2.000% 5,815.00 135,815.00 -
12/01/2018 - - - - 141,630.00
04/01/2019 - - 4,515.00 4,515.00 -
10/01/2019 135,000.00 2.000% 4,515.00 139,515.00 -
12/01/2019 - - - - 144,030.00
04/01 /2020 - - 3,165.00 3,165.00 -
10/01/2020 135,000.00 2.200% 3,165.00 138,165.00 -
12/01/2020 - - - - 141,330.00
04/01 /2021 - - 1,680.00 1,680.00 -
10/01/2021 140,000.00 2.400% 1,680.00 141,680.00 -
12/01/2021 - - - - 143,360.00
Total $1,040,000.00 - $143,627.50 ;1,183,627.50 -
Dated 11/01/2011
Delivery Date 11/10/2011
First Coupon Date 4/01/2012
First available call date 10/01/2018
Call Price 100.0000000%
Accrued Interest from 11/01/2011 to 11/10/2011 540.75
Bond Year pollars $6,783.33
Average Life 6.522 Years
Average Coupon 2.1173587%
Net Interest Cost (NIC) 2.0971622%
True Interest Cost (TIC) 2.0929056%
Bond Yield for Arbitrage Purposes 1.7089022%
Net interest Cost 1.8049923%
Weighted Average Maturity 6.489 Years
Ref 3 � 2006 Ref � 10/ 6/2011 � 9:09 AM
Northland Securities
Public Finance Page �o
Pinal
� City of Saint Joseph, Minnesota
G.O. Bonds, Series 2011A
New Money CIP
Debt Service Schedule
Date Principal Coupon Interest Total P+I Fiscal Total
11 /10/2011 - - - - -
04/01 /2012 - - 1,675.00 1,675.00 -
10/01/2012 15,000.00 2.000% 2,010.00 17,010.00 -
12/01/2012 - - - - 18,685.00
04/01 /2013 - - 1,860.00 1,860.00 -
10/01/2013 20,000.00 2.000% 1,860.00 21,860.00 -
12/01/2013 - - - - 23,720.00
04/01/2014 - - 1,660.00 1,660.00 -
10l01/2014 20,000.00 2.000% 1,660.00 21,660.00 -
12/01/2014 - - - - 23,320.00
04/01/2015 - - 1,460.00 1,460.00 -
10/01/2015 20,000.00 2.000°/a 1,460.00 21,460.00 -
12/01/2015 - - - - 22,920.00
04/01l2016 - - 1,260.00 1,260.00 -
10/01/2016 20,000.00 2.000°/a 1,260.00 21,260.00 -
12/01/2016 - - - - 22,520.00
04/01/2017 - - 1,060.00 1,060.00 -
10/01/2017 20,000.00 2.000% 1,060.00 21,060.00 -
12/01/2017 - - - - 22,120.00
04/01/2018 - - 860.00 860.00 -
10/01/2018 20,000.00 2.000% 860.00 20,860.00 -
12/01/2018 - - - - 21,720.00
04l01/2019 - - 660.00 660.00 -
10/01/2019 20,000.00 2.000% 660.00 20,660.00 -
12/01/2019 - - - - 21,320.00
04/01/2020 - - 460.00 460.00
10/01/2020 20,000.00 2.200% 460.00 20,460.00 -
12/01/2020 - - - - 20,920.00
04/01/2021 - - 240.00 240.00 -
10/01/2021 20,000.00 2.400% 240.00 20,240.00 -
12/01/2021 - - - - 2Q,480.00
Totai $195,000.00 - $22,725.00 $217,725.00 -
Dated 11 /01 /2011
Delivery Date 11/10/2011
First Coupon Date 4/01/2012
First available call date 10/01/2018
Call Price 100.0000000%
Accrued Interest from 11/01/2011 to 11/10/2�11 100.50
Bond Year pollars $1,078.75
Average Life 5.532 Years
Average Coupon 2.1066049%
Net Interest Cost (NIC) 2.0635829°/a
True Interest Cost (TIC) 2.0575181%
Bond Yield for Arbitrage Purposes 1.7089022%
Net Interest Cost 1.7226505%
Weighted Average Maturity 5.503 Years
Ref 3 � CIP � 10/ 6/2011 � 9:09 AM
Northland Securities
Public Finance Page 11