HomeMy WebLinkAbout6.f. 2005C G.O Water Revenue Bonds Issue-Authorizing Issuance and Setting Bond SaleAGENDA ITEM: 2005C G.O. Water Revenue Bonds Issue
Authorizing Issuance and Setting Bond
Sale
AGENDA SECTION:
Consent
PREPARED BY: Jeff May, Finance Director
AGENFTEM #5
ATTACHMENTS: Resolution and Recommendations
APPROVED BY:
RECOMMENDED ACTION: Motion to adopt A RESOLUTION PROVIDING F THE
COMPETITIVE NEGOTIATED SALE OF $2,990,000 GENERAL OBLIGATION WATER
REVENUE BONDS, SERIES 2005C
4 ROSEMOUNT
CITY COUNCIL
City Council Meeting Date: September 6, 2005
EXECUTIVE SUMMARY
ISSUE
The authorization to issue bonds for the construction of Water Tower #4.
BACKGROUND
This item is on the agenda for your consideration in authorizing the issuance and setting the sale of
General Obhgation Water Revenue Bonds for the construction of Water Tower #4
Bids will be open until Tuesday, October 4, 2005, at 12:00 P.M at the offices of Sprmgsted Incorporated.
The bids will be tabulated there and then consideration for award of the Bonds will be by the City Council
at 7:30 P.M Central Time, of the same day.
SUMMARY
Recommend the above motion.
CITY OF ROSEMOUNT
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2005
RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED SALE OF
$2,990,000 GENERAL OBLIGATION WATER REVENUE BONDS, SERIES 2005C
WHEREAS, the City Council of the City of Rosemount, Minnesota, has heretofore determined
that it is necessary and expedient to issue its $2,990,000 General Obligation Water Revenue
Bonds, Senes 2005C (the "Bonds to finance the acquisition and construction of a water tower
within the City, and
WHEREAS, the City has retained Spnngsted Incorporated, in Saint Paul, Minnesota
"Spnngsted as its independent financial advisor and is therefore authorized to sell these
obligations by a competitive negotiated sale in accordance with Minnesota Statutes, Section
475.60, Subdivision 2(9), and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Rosemount,
Minnesota, as follows
1. Authorization; Findings. The City Council hereby authorizes Spnngsted to solicit bids
for the competitive negotiated sale of the Bonds.
2. Meeting; Bid Opening. This City Council shall meet at the time and place specified in
the Terms of Proposal attached hereto as Exhibit A for the purpose of considering sealed bids
for, and awarding the sale of, the Bonds. The Administrator, or his designee, shall open bids at
the time and place specified in such Terms of Proposal
3. Terns of Proposal The terns and conditions of the Bonds and the negotiation thereof
are fully set forth in the "Terms of Proposal" attached hereto as Exhibit A and hereby approved
and made a part hereof.
4. Official Statement. In connection with said competitive negotiated sale, the
Administrator, Finance Director and other officers or employees of the City are hereby
authorized to cooperate with Spnngsted and participate in the preparation of an official statement
for the Bonds, and to execute and deliver it on behalf of the City upon its completion.
1794371v1
ADOPTED this 6th day of September, 2005.
ATTEST:
Linda J. Jentink, City Clerk
Motion by: Seconded by:
Voted in favor:
Voted Against:
Members Absent:
1794371v1 2
William H. Droste, Mayor
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE
THIS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE
FOLLOWING BASIS:
OR
1794371v1
EXHIBIT A
TERMS OF PROPOSAL
$2,990,000
CITY OF ROSEMOUNT, MINNESOTA
GENERAL OBLIGATION WATER REVENUE BONDS, SERIES 2005C
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, October 4, 2005, until 12:00 Noon, Central
Time, at the offices of Sprmgsted Incorporated, 380 Jackson Street, Suite 300, Saint Paul,
Minnesota, after which time they will be opened and tabulated Consideration for award of the
Bonds will be by the City Council at 7 P.M., Central Time, of the same day.
SUBMISSION OF PROPOSALS
Sprmgsted will assume no liability for the inability of the bidder to reach Sprmgsted prior to the
time of sale specified above. All bidders are advised that each Proposal shall be deemed to
constitute a contract between the bidder and the City to purchase the Bonds regardless of the
manner in which the Proposal is submitted.
(a) Sealed Bidding. Proposals may be submitted in a sealed envelope or by fax (651) 223 -3046
to Sprmgsted. Signed Proposals, without final pnce or coupons, may he submitted to Sprmgsted
prior to the time of sale. The bidder shall be responsible for submitting to Springsted the final
Proposal price and coupons, by telephone (651) 223 -3000 or fax (651) 223 -3046 for inclusion in
the submitted Proposal
(b) Electronic Bidding. Notice is hereby given that electronic proposals will be received via
PARITY For purposes of the electronic bidding process, the time as maintained by PARITY
shall constitute the official time with respect to all Bids submitted to PARITY Each bidder
shall be solely responsible for making necessary arrangements to access PARITY for purposes
of submitting its electronic Bid irz a timely manner and in compliance with the requirements of
the Terms of Proposal. Neither the City, its agents nor PARITY shall have any duty or
obligation to undertake registration to bid for any prospective bidder or to provide or ensure
electronic access to any qualified prospective bidder, and neither the City, its agents nor
PARITY shall be responsible for a bidder's failure to register to bid or for any failure m the
proper operation of, or have any liability for any delays or interruptions of or any damages
caused by the services of PARITY The City is using the services of PARITY solely as a
communication mechanism to conduct the electronic bidding for the Bonds, and PARITY' is not
an agent of the City.
If any provisions of this Terms of Proposal conflict with information provided by PARITY this
Terms of Proposal shall control Further information about PARITY including any fee
charged, may be obtained from:
PARITY 1359 Broadway, 2 Floor, New York, New York 10018
Customer Support: (212) 849 -5000
2007 $325,000
2008 $270,000
2009 $275.000
2010 $285,000
1794371v]
DETAILS OF THE BONDS
The Bonds will be dated November 1, 2005, as the date of original issue, and will bear interest
payable on August 1 and February 1 of each year, commencing August 1, 2006. Interest will be
computed on the basis of a 360 -day year of twelve 30 -day months.
The Bonds will mature February 1 in the years and amounts as follows:
2011 $295,000
2012 $305,000
2013 $315,000
BOOK ENTRY SYSTEM
2014 $325,000
2015 $335,000
2016 $350,000
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds All tern bonds shall be subject to mandatory sinking fluid redemption
and must conform to the maturity schedule set forth above at a price of par plus accrued interest
to the date of redemption In order to designate term bonds, the proposal must specify "Years of
Term Maturities" in the spaces provided on the Proposal Form.
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public. The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
registered in the name of Cede Co as nominee of The Depository Trust Company "DTC
New York, New York, which will act as securities depository of the Bonds. Individual
purchases of the Bonds may be made in the principal amount of 55,000 or any multiple thereof
of a single maturity through book entries made on the books and records of DTC and its
participants. Principal and interest are payable by the registrar to DTC or its nominee as
registered owner of the Bonds Transfer of principal and interest payments to participants of
DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial
owners by participants will be the responsibility of such participants and other nominees of
beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to
deposit the Bonds with DTC.
REGISTRAR
The City will name the registrar, which shall be subject to applicable SEC regulations. The City
will pay for the services of the registrar.
OPTIONAL REDEMPTION
The City may elect on February 1, 2013, and on any day thereafter, to prepay Bonds due on or
after February 1, 2014 Redemption may be in whole or in part and if in part at the option of the
City and in such manner as the City shall determine. If less than all Bonds of a maturity are
called for redemption, the City will notify DTC of the particular amount of such maturity to be
prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to
be redeemed and each participant will then select by lot the beneficial ownership interests in
such maturity to be redeemed. All prepayments shall be at a price of par plus accrued interest.
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. In addition, the City will pledge net
revenues of the City's water utility system The proceeds will be used to finance the acquisition
and construction of a water tower within the City.
1794371v1
TYPE OF PROPOSALS
Proposals shall be for not less than $2,966,080 and accrued interest on the total principal amount
of the Bonds Proposals shall be accompanied by a Good Faith Deposit "Deposit m the form
of a certified or cashier's check or a Financial Surety Bond in the amount of S29,900, payable to
the order of the City. If a check is used, it must accompany the proposal If a Financial Surety
Bond is used, it must be from an insurance company licensed to issue such a bond in the State of
Minnesota, and preapproved by the City Such bond must be submitted to Springsted
Incorporated prior to the opening of the proposals The Financial Surety Bond must identify
each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the Bonds are
awarded to an underwriter using a Financial Surety Bond, then that purchaser is required to
submit its Deposit to Springsted Incorporated in the form of a certified or cashier's check or wire
transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central Time, on the
next business day following the award. If such Deposit is not received by that time, the
Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement. The
Deposit received from the purchaser, the amount of which will be deducted at settlement and no
interest will accrue to the purchaser, will be deposited by the City. In the event the purchaser
fails to comply with the accepted proposal, said amount will be retained by the City No
proposal can be withdrawn or amended after the time set for receiving proposals unless the
meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to
another date without award of the Bonds having been made. Rates shall be m integral multiples
of 5 /100 or 1/8 of 1% Rates must be in level or ascending order. Bonds of the saline maturity
iii
shall bear a single rate from the date of the Bonds to the date of maturity. No conditional
proposals will be accepted.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling.
The City will reserve the right to: (i) waive non substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (u) reject all proposals
without cause. and (in) reject any proposal that the City determines to have failed to comply with
the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of the
Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of insurance
shall be paid by the purchaser, except that, if the City has requested and received a rating on the
Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall
be the responsibility of the purchaser.
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser through DTC in New York, New York. Delivery will be subject to receipt by the
purchaser of an approving legal opinion of Briggs and Morgan, Professional Association, of
Saint Paul and Minneapolis, Minnesota, and of customary closing papers, including a no-
litigation certificate. On the date of settlement, payment for the Bonds shall be made in federal,
or equivalent, funds that shall be received at the offices of the City or its designee not later than
12:00 Noon, Central Time. Unless compliance with the terms of payment for the Bonds has
been made impossible by action of the City, or its agents, the purchaser shall be liable to the City
1794371v1
CUSIP NUMBERS
SETTLEMENT
iv
for any loss suffered by the City by reason of the purchaser's non compliance with said terms for
payment.
CONTINUING DISCLOSURE
On the date of actual issuance and delivery of the Bonds, the City will execute and deliver a
Continuing Disclosure Undertaking (the "Undertaking whereunder the City will covenant for
the benefit of the owners of the Bonds to provide certain financial and other information about
the City and notices of certain occurrences to information repositories as specified in and
required by SEC Rule 15c2- 12(b)(5).
OFFICIAL STATEMENT
The City has authonzed the preparation of an Official Statement containing pertinent information
relative to the Bonds, and said Official Statement will serve as a nearly final Official Statement
within the meaning of Rule 15c2 -12 of the Securities and Exchange Commission For copies of
the Official Statement or for any additional information prior to sale, any prospective purchaser
is referred to the Financial Advisor to the City, Springsted Incorporated, 380 Jackson Street,
Suite 300, Saint Paul, Minnesota 55101, telephone (651) 223 -3000.
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds. together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2 -12 By awarding the Bonds to any underwriter
or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than
seven business days after the date of such award, it shall provide without cost to the senior
managing underwriter of the syndicate to which the Bonds are awarded 120 copies of the
Official Statement and the addendum or addenda described above. The City designates the
senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for
purposes of distributing copies of the Final Official Statement to each Participating Underwriter.
Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its
proposal is accepted by the City (r) it shall accept such designation and (ii) it shall enter into a
contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring
the receipt by each such Participating Underwriter of the Final Official Statement.
Dated September 6, 2005 BY ORDER OF THE CITY COUNCIL
1794371v1 v
/s/ Linda Jentink
City Clerk
STATE OF MINNESOTA
COUNTY OF DAKOTA ss
CITY OF ROSEMOUNT
I, Linda J. Jentink, duly appointed, acting and qualified City Clerk of the City of Rosemount do
hereby certify that I have examined the City of Rosemount records and the Minute Book of said
City for the meeting of the 6th of September, 2005 and that the attached copy of the
RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED SALE OF
$2,990,000 GENERAL OBLIGATION WATER REVENUE BONDS, SERIES 2005C was
approved and is a true and correct copy of the City Proceedings relating to said Resolution.
IN WITNESS WHEREOF, I have hereunto set my hand and seal of said City this day of
September, 2005.
1794371v1
CERTIFICATE
Linda J. Jentrnk, City Clerk
City of Rosemount
Dakota County, Minnesota
Presented to:
Honorable William H. Droste, Mayor
Members, City Council
Mr Jamie Verbrugge, City Administrator
Mr Jeffrey May, Finance Director
City of Rosemount
2875 —145 Street West
Rosemount, MN 55068 -4941
Study No.: R0704P505
SPRINGSTED Incorporated
August 29, 2005
Recommendations
For
City of Rosemount, Minnesota
$2,990,000
General Obligation Water Revenue Bonds, Series 2005C
$1,120,000
General Obligation Fire Station Refunding Bonds, Series 2005D
5
springsted
We recommend the following for the Bonds.
2 Sale Date and Time
3 Method of Sale
5 Principal Amount of the Bonds
RECOMMENDATIONS
Re Recommendations for the Issuance of
$2,990,000 General Obligation Water Revenue Bonds, Series 2005C (the "Revenue Bonds
$1 120,000 General Obligation Fire Station Refunding Bonds, Series 2005D (the "Refunding Bonds
(collectively, the "Bonds' or Issues
We respectfully request your consideration of our recommendations for the above -named Issues. Proceeds of the
Revenue Bonds will be used to finance the construction of a water tower within the City Proceeds of the Refunding
Bonds will be used to refund the February 1, 2007 through February 1, 2016 maturities of the City's General
Obligation Fire Station Bonds Series 1996A (the "Refunded Bonds dated July 1, 1996.
1. Action Requested To establish the date and time of receiving bids and
establish the terms and conditions of the offerings
Tuesday, October 4, 2005 at 12 00 Noon, with
consideration for award by the City Council at
7 30 P M that same day
The Bonds will be sold using a competitive bidding
process In the interest of obtaining as many bids as
possible, we have included a provision in the attached
Terms of Proposal for underwriters to submit their bid
electronically through the electronic bidding platform of
PARITY In addition, physical bids (by phone or fax)
will be accepted at the offices of Spnngsted
4. Authority for the Issues The Bonds are being issued pursuant to Minnesota
Statutes, Chapter 475
The Revenue Bonds are further authorized pursuant to
Minnesota Statutes, Chapter 444
The Revenue Bonds $2,990.000
The Refunding Bonds $1,120,000
Included in the attached Terms of Proposal is a
provision that permits the City to increase or reduce
the principal amount of the Refunding Bonds in any of
the maturities This allows for any necessary
adjustments required based on final interest rates and
issuance costs.
City of Rosemount, Minnesota
August 29, 2005
6 Repayment Term
8. Prepayment Provisions
9 Credit Rating Comments
10 Term Bonds
The Revenue Bonds will mature annually
February 1, 2007 through 2016. Interest will be
payable semi annually each February 1 and August 1,
commencing August 1, 2006.
The Refunding Bonds will mature annually
February 1, 2007 through 2016. Interest will be
payable semi- annually each February 1 and August 1,
commencing August 1, 2006.
7. Security and Source of Payment The Issues will be general obligations of the City,
secured by its full faith and credit and taxing power
Source of payment and payment cycle for each issue
can be found in the Discussion section
The City may elect on February 1, 2013. and on any
date thereafter. to prepay the Revenue Bonds due on
or after February 1, 2014, at a price of par plus
accrued interest
To maximize the potential for savings. the Refunding
Bonds will not be subject to prepayment prior to their
stated maturity dates
An application will be made to Moody's Investors
Service for ratings on the Bonds The City's current
general obligation credit rating is "Al'
We have included a provision that permits the
underwriters to combine multiple maturity years into a
term bond, subject to mandatory redemption on the
same maturity schedule provided in the Terms of
Proposal The advantage to the underwriter is that it
provides large blocks of bonds, which are more
attractive to bond funds, and certain pension funds
This in turn is a benefit to the City since selling larger
blocks of bonds reduces the risk to the underwriter,
allowing them to lower their costs and the interest
coupons Since the Bonds are being offered on a
competitive bid basis and awarded on the lowest true
interest cost the City will award the Bonds to the best
bid regardless of whether term bonds are chosen or
not
Page 2
City of Rosemount, Minnesota
August29 2005
11 Federal Treasury Regulations Concerning Tax
Exempt Obligations
(a) Bank Qualification
(b) Rebate Requirements
Under Federal Tax Law, financial institutions cannot
deduct from income for federal income tax purposes,
expense that is allocable to carrying and acquiring tax
exempt bonds There is an exemption to this for "bank
qualified" bonds, which can be so designated if the
issuer does not issue more than $10 million of tax
exempt bonds in a calendar year. Issues that are
bank qualified generally receive slightly lower interest
rates than issues that are not bank qualified Since
the City expects to issue less than $10 million of tax
exempt obligations in 2005, the Bonds are designated
as bank qualified
All tax exempt issues are subject to the federal
arbitrage and rebate requirements, which require all
excess earnings created by the financing to be rebated
to the U S Treasury The requirements generally
cover two categories: bond proceeds and debt service
funds There are exemptions from rebate in both of
these categories
Bond proceeds defined generally as both the original
principal of the issue and the investment earnings on
the principal, have 6, 18 and 24 month spend down
exemption periods If all of the proceeds are
expended during one of those exemption periods, the
issuer is exempt from rebate and may retain the
excess earnings
The Revenue Bonds The City expects to meet the 18
month spend down exemption, in which case no
rebate of construction fund interest earnings will be
required The City should be aware that this test is an
"actual" test, not one of "reasonable expectations" and
you will need to determine if the spend down was met
or if rebate may be required In any event, bond
proceeds, if any, not set aside for project expenditures
may still be subject to rebate.
Page 3
City of Rosemount, Minnesota
August 29, 2005
(c) Bona Fide Debt Service Fund
(d) Economic Life
(e) Federal Reimbursement Regulations
The Refunding Bonds Proceeds of the Refunding
Bonds will be expended within 90 days of closing,
thereby meeting the six -month expenditure exception
to rebate
Springsted currently provides arbitrage rebate services
for the City under a separate contract An amendment
to that contract adding these Issues has been provided
to City staff
The City must maintain a bona fide debt service fund
for the Bonds or be subject to yield restriction This
requires restricting the investments held in the debt
service fund to the yield on the Bonds and/or paying
back excess investment earnings in the debt service
fund to the federal government A bona fide debt
service fund is a fund for which there is an equal
matching of revenue to debt service expense with
carry over permitted equal to the greater of the
investment earnings in the fund during that year or
1/12 the debt service of that year
The average life of the Bonds cannot exceed 120% of
the economic life of the projects to be financed
The average life of the Revenue Bonds is 6 058 years,
and the useful life of the project to be financed is 50
years Therefore, the Revenue Bonds are within the
economic lice requirements
The original financing for the Refunding Bonds was for
building projects that have an average life of 40 -50
years Because the average life of the Refunding
Bonds is shorter than the remaining average life of the
Refunded Bonds, the Refunding Bonds are within the
economic life requirements
Federal reimbursement regulations require the City to
make a declaration, within 60 days of the actual
payment, of its intent to reimburse itself from expenses
paid prior to the receipt of proceeds of the Revenue
Bonds It is our understanding the City has taken
whatever actions are necessary to comply with the
federal reimbursement regulations in regards to the
Revenue Bonds
Page 4
City of Rosemount, Minnesota
August 29, 2005
12 Continuing Disclosure
13. Attachments
The Revenue Bonds
DISCUSSION
The Bonds are subject to continuing disclosure
requirements set forth by the Securities and Exchange
Commission The SEC rules require the City to
undertake an annual update of certain Official
Statement information and report any material events
to the national repositories Springsted currently
provides continuing disclosure services for the City
under a separate contract An amendment to that
contract adding these Issues has been provided to
City staff
The Revenue Bonds
Sources and Uses of Funds
Debt Service Schedule
The Refunding Bonds
Refunding Schedules
Terms of Proposals
Proceeds of the Revenue Bonds will be used to finance the construction of a water tower within the City The
sources and uses of funds for the Revenue Bonds are shown on page 8 The debt service schedule for the
Revenue Bonds is shown on page 9 The Revenue Bonds have been structured over a term of 10 years with even
annual payments of principal and interest
The Revenue Bonds will be repaid from net revenues of the City's Water Fund Pursuant to Minnesota Statutes,
Chapter 444 and the resolution awarding the Revenue Bonds, the City will covenant to maintain water rates in an
amount sufficient to generate revenues to support the operation of the water utility and to pay debt service. The City
is required to annually review the budget of the utility to determine whether current rates and charges are sufficient
and to adjust them as necessary
The City currently has three outstanding bond issues for which the net revenues of the Water Fund are also pledged:
(1) the 2000 General Obligation Water Revenue Bonds, Series 2000A which will have a final maturity in 2016, (u) the
2002 General Obligation Water and Storm Water Revenue Bonds, Series 2002B, which will have a final maturty in
2018, and (ii) the 2003 General Obligation Water Revenue Bonds, Series 2003B, with a final maturity in 2014. The
table on the following page shows the net revenues available for debt service of the City's Water Fund for fiscal year
ending December 31, 2004 The maximum annual debt service payment, including this Issue is projected to be
$678,333 in 2013
Page 5
City of Rosemount, Minnesota
August 29, 2005
The Refunding Bonds
2004 Net Revenues of the Water Fund
Operating Revenues
Less Operating Expenses
Add Back Depreciation
Investment Income
Connection Fees
Special Assessments
Net Revenues Available for Debt Service
Less Projected Maximum Annual Debt Service
Remaining Capacity for Annual Debt Service
1,189,140
(1,662,962)
487,874
138,665
1.957,729
75,140
2,185,586
(678,333)
S 1,507 253
The proceeds of the Refunding Bonds will be used on February 1, 2006 to redeem the February 1, 2007 through
2016 maturities of the City's General Obligation Fire Station Bonds, Series 1996A (the "Refunded Bonds dated
July 1, 1996 and currently outstanding in the aggregate principal amount of $1.165,000 The Refunded Bonds were
originally issued to finance the acquisition and construction of a fire station for the City The refunding is being
undertaken to allow the City to take advantage of lower interest rates
The issuance of the Refunding Bonds is being conducted as a 'current' refunding, in which the proceeds of the
Refunding Bonds (new issue) are used within ninety days of bond settlement to redeem principal of the Refunded
Bonds (old issue) On February 1, 2006, the City will use (i) funds on hand from 2005 collections of tax levies to pay
the scheduled principal and interest due on the Refunded Bonds and the proceeds of the Refunding Bonds to
redeem the remaining $1,085.000 of outstanding principal on the Refunded Bonds The City will need to invest
the proceeds of the Refunding Bonds for the period between the closing date and the call date
(February 1, 2006) in order to achieve the savings level estimated for this transaction.
Based on current interest rate estimates, the refunding is projected to produce cash flow savings averaging
approximately $9,180 annually beginning with the 2005 levy for taxes collected in 2006 This results in future value
savings of approximately $105 000, with a net present value benefit to the City of approximately $84,000 These
estimates are net of all costs associated with the refunding The City will begin to realize cash flow savings
beginning with the City's 2005 levy and the August 1, 2006 interest payment
We have attached a set of schedules that summarize the refunding statistics and the projected savings resulting
from the sale of the Refunding Bonds These schedules include the following information
Preliminary Feasibility Summary indicates the sizing of the Refunding Bonds, savings data and bond data
page 10
Page 6
City of Rosemount, Minnesota
August 29, 2005
Prior Original Debt Service shows the existing debt service requirements on the Refunded Bonds without a
refunding page 11
Debt Service to Call and to Maturity shows the Refunded Bonds' remaining debt service to maturity and to
the call date page 12
Debt Service Schedule: shows the new projected debt service on the Refunding Bonds based on current
estimated interest rates page 13
Debt Service Comparison shows the debt service comparison and the projected annual cash flow savings
of the Refunding Bonds to the Refunded Bonds page 14
Springsted's current estimates show this transaction will generate approximately 7 035% present value savings.
The success of any refunding transaction is in a large part dependent upon market conditions at the time the
refunding bonds are sold Springsted will continue to monitor the market prior to the sale date and will keep you
apprised of any change in conditions which might impact the success of this refunding
Springsted is pleased to again be of service to the City of Rosemount
Respectfully submitted,
SPRI GSTED In'orporated
ss
Provided to Staff Rebate and Continuing Disclosure Contract Amendments
Page 7
Sources Of Funds
Par Amount of Bonds
Total Sources
Uses Of Funds
Deposit to Project Construction Fund
Costs of Issuance
Total Underwriter's Expense (0 800%)
Rounding Amount
Senn 2005 GO Water Reve 1 SINGLE PURPOSE 8/3/2X5 i 10 03 AAA
7,,L2; Springsted
$2,990,000
City of Rosemount, Minnesota
General Obligation Water Revenue Bonds, Series 2005C
Dated 11/0112005 1 Delivered 11/01/2005
Sources Uses
$2,990,000 00
$2,990,000.0D
2,938,000 00
26 850 00
23 920 00
1 230 00
Total Uses $2,990,000.00
Page 8
SIGNIFICANT DATES
Dated Date
Delivery Date
First Coupon Date
Yield Statistics
Bond Year Dollars
Average Life
Average Coupon
Net Interest Cost (NIC)
True Interest Cost (TIC)
Bond Yield for Arbitrage Purposes
All Inclusive Cost (AIC)
IRS Form 8038
Net Interest Cost
Weighted Average Maturity
Senes 2005 GO Weer heir 1 S/VCLE IMPOSE 8/3/2005 10 03 AM
Springsted
$2,990,000
City of Rosemount, Minnesota
General Obligation Water Revenue Bonds, Series 2005C
DEBT SERVICE SCHEDULE
Date
Principal Coupon Interest Total P +I
02/01/2006
02/01/2007 235,000 00 2 900% 127,646 88 362,646 88
02/01/2008 270,000 00 2 950% 95,302 50 365 302 50
02/01/2009 275 000 00 3 050% 87 337 50 362 337 50
02/01/2010 285,000 00 3 200% 78 950 00 363,950 00
02/01/2011 295,000 00 3 350% 69,830 00 364,830 00
02/01/2012 305,000 00 3 450% 59,947 50 364,947 50
02/01/2013 315,000 00 3 550% 49,425 00 364 425 00
02/01/2014 325 000 00 3 650% 38 242 50 363 242 50
02101/2015 335 000 00 3 800% 26,380 00 361,380 00
02/01/2016 350,000 00 3 900% 13,650 00 363 650 00
Total $2,990,00000 $646,711 88 $3,636,71188
11/01/2005
11/01/2005
8/01/2006
$18,112 50
6 058 Years
3 5705280%
3 7025915%
3 7081536%
3 5567118%
3 8801660%
3 5705280%
6 058 Years
Page 9
Dated 11/01/20051 Delivered 11/0312005
Sources Of Funds
Par Amount of Bonds $1,120 000 00
Accrued Interest from 11/01/2005 to 11103/2005 212 32
Total Sources. $1,120,212 32
Uses Of Funds
Deposit to Current Refunding Fund
Costs of Issuance
Total Underwriter's Discount (0 675%)
Rounding Amount
Deposit to Debt Service Fund
Total Uses
ISSUES REFUNDED AND CALL INFORMATION
Prior Issue Call Price
Prior Issue Call Date
SAVINGS INFORMATION
Net Future Value Benefit
Net Present Value Benefit
Net PV Benefit 1 $1,200 994 05 PV Refunded Debt Service
BOND STATISTICS
Averace Life
Average Coupon
Net Interest Cost (NIC)
True Interest Cost (TIC)
1 The estimated savings results of the refunding are subject to market conditions
krlcs 200' Art 964 SLA'GLEFCAPoW ;:27/20051 IDSiM^
Springsted
$1,120,000
City of Rosemount, Minnesota
General Obligation Fire Station Refunding Bonds, Series 2005D
Current Refunding of Series 1996A
Preliminary Feasibility Summary
1,085,000 00
23,950 00
7 560 00
3 490 00
212 32
$1,120,212 32
100 000%
2/01/2006
1 $104 678 68
584,484 05
7 035%
6 031 Years
3 5684586%
3 6803757%
3 6827255%
Page 10
$1,780,000
City of Rosemount, Minnesota
General Obligation Fire Station Bonds
Series 1996A
Prior Original Debt Service
Date
Principal Coupon Interest Total P +I
08/01/1996
02/01/1997 90,000 00 4 100% 55,257 71 145257 71
08/01/1997 45,518 75 45,518 75
02/01/1998 55,000 00 4 250% 45,518 75 100,518 75
08/01/1998 44,350 00 44,350 00
02101/1999 60,000 00 4 400% 44 350 00 104,350 00
08/01/1999 43 030 00 43,030 00
02/01/2000 60,000 00 4 600% 43 030 00 103,030 00
08/01/2000 41 650 DO 41,650 00
02/01/2001 65,000 00 4 700% 41 650 00 106,650 00
08/01/2001 40,122 50 40 122 50
02/01/2002 65,000 00 4 800% 40,122 50 105 122 50
08/01/2002 38,562 50 38 562 50
02/01/2003 70,000 00 4 900% 38,562 50 108 562 50
08/01/2003 36,847 50 36,847 50
02/01 /2004 75,000 00 5 000% 36,847 50 111,847 50
08/01/2004 34,972 50 34,972 50
02/01/2005 75,000 00 5 100% 34,972 50 109,972 50
08/01/2005 33,060 00 33,060 00
02/01/2006 80,000 00 5 200% 33 060 00 113 060 00
08/01/2006 30,980 00 30,980 00
02/01/2007 85,000 00 5 300% 30,980 00 115,980 00
08/01/2007 28 727 50 28,727 50
02/01/2008 90 000 00 5 400% 28,727 50 118,727 50
08/01/2008 26 297 50 26,297 50
02/01/2009 95,000 00 5 500% 26 297 50 121,297 50
08/01/2009 23 685 00 23,685 00
02/01/2010 100,000 00 5 600% 23 685 00 123,685 00
08/01/2010 20 885 00 20 885 00
02/01/2011 105 000 00 5 700% 20 885 00 125 885 00
08/01/2011 17 892 50 17 892 50
02/01/2012 110,000 00 5 750% 17 892 50 127 892 50
08/01/2012 14,730 00 14 730 00
02/01/2013 115,000 00 5 800% 14,730 00 129 730 00
08/01/2013 11,395 00 11 395 00
02/01/2014 120,000 00 5 850% 11 395 00 131 395 00
08/01/2014 7 885 00 7 885 00
02/01/2015 130,000 00 5 900% 7 885 00 137 885 00
08/01/2015 4 050 00 4 050 00
02/01/2016 135 000 00 6 000% 4,050 00 139 050 00
Total $1,780 000 00 $1,144 540 21 $2,924 540 21
Yield Statistics
Average Life
Weighted Average Maturity (Par Basis)
Average Coupon
Refunding Bond Information
Refunding Dated Date
Refunding Delivery Date
1 The est]mated u urge results of the refunding rue sublec/ to market conditions
,Sena 1996A 1 JINGLL/VAPOSL 1 9/27/2005 1 10 57,441
Springsted
5 761 Years
5 755 Years
5 8049544%
11/01/2005
11/03/2005
Page 11
Date
Refunded
Bonds
D/S To Call
Principal Coupon Interest Refunded D/S
11/03/2005
02/01/2006
08/D1/2006
02/01/2007
08/01/2007
02/01/2008
08/01/2008
02/01/2009
08/01/2009
02/01/2010
08/01/2010
02/01/2011
08/01/2011
02/01/2012
08/01/2012
02/01/2013
08/01/2013
02/01/2014
08/01/2014
02/01/2015
08/01/2015
02/01/2016
1,085,000 00 1,085,000 00
5 200%
30 980 00
85,000 00 5 300% 30 980 00
28 727 50
90,000 00 5 400% 28 727 50
26 297 50
95,000 00 5 500% 26 297 50
23 685 00
100,000 00 5 600% 23 685 00
20 885 00
105,000 00 5 700% 20,885 00
17 892 50
110,000 00 5 750% 17 892 50
14,730 00
115,000 00 5 800% 14,730 00
11,395 00
120,000 00 5 850% 11,395 00
7,885 00
130,000 00 5 900% 7,885 00
4,050 00
135,000 00 6 000% 4,050 00
30,980 00
115,980 00
28,727 50
118,727 50
26,297 50
121,297 50
23,685 00
123,685 00
20,885 00
125 885 00
17 892 50
127 892 50
14 730 00
129,730 OD
11 395 00
131 395 00
7 885 DO
137 885 DO
4 050 DD
139 050 DD
Total 51,085,000 00 $1,085 000 00 51 085,000 00 5373,055 00 $1,458 055 DD
Yield Statistics
Average Life
Weighted Average Maturity (Par Basis)
Average Coupon
Refunding Bond Information
Refunding Dated Date
Refunding Delivery Date
1 The estimated sanngs results of the refunding are subject to market conditions
Sene• 2996A j 9NGLEJUUNOA 727/2005 1057,54
Springsted
$1,780,000
City of Rosemount, Minnesota
General Obligation Fire Station Bonds
Series 1996A
Debt Service To Call And To Maturity
6 167 Years
6 161 Years
5 5752662%
11/01/2005
11/03/2005
Page 12
Yield Statistics
Net Interest Cost (NIC)
True Interest Cost (TIC)
Bond Yield for Arb trace Purposes
All Inclusive Cost (AIC)
IRS Form 8038
Net Interest Cost
Weighted Average Maturity
Springsted
$1,120,000
City of Rosemount, Minnesota
General Obligation Fire Station Refunding Bonds, Series 2005D
Current Refunding of Series 1996A
Debt Service Schedule
Date
Principal Coupon Interest Total P +I
02/01/2006
02/01/2007 90,000 00 2 900% 47,771 88 137,771 88
02/01/2008 100,000 00 2 950% 35 607 50 135,607 50
02/01/2009 105,000 00 3 050% 32 657 50 137,657 50
02/01/2010 110,000 00 3 200% 29,455 00 139,455 00
02/01/2011 110,000 00 3 350% 25,935 00 135,935 00
02/01/2012 115,000 00 3 450% 22,250 00 137,250 00
02/01/2013 115,000 00 3 550% 18,282 50 133,282 50
02/01/2014 120,000 00 3 650% 14 200 00 134,200 00
02/01/2015 125,000 00 3 800% 9 820 00 134,820 00
02/01/2016 130,000 00 3 900% 5 070 00 135,070 00
Total $1,120,00000 $241 049 38 $1,361,04938
Accrued Interest from 11/01/2005 to 11/03/2005
Bond Year Dollars
Average Life
Average Coupon
1 The estimated savings 1; cults 01 the refunding an salved to market conditions
Srnes 2005 Ref96A c1VGLL PURPOSE 1 7/27/2005 1 10 57 44
212 32
$6,755 00
6 031 Years
3 5684586%
3 6803757%
3 6827255%
3 5546673%
4 0974468%
3 6806229%
6 026 Years
Page 13
Date Total P41 Escrow Existing D/S Net New D/S Old Net D/S Savings
02/01 /2006 (3 970 74) 113,060 00 109 089 26 113,060 00 3,970 74
02/01/2007 137,771 88 137,771 88 146,960 00 9,18812
02/01/2008 135,607 50 135,607 50 147,455 00 11,847 50
02/01/2009 137 657 50 137,657 50 147,595 00 9 937 50
02/01/2010 139 455 00 139,455 00 147,370 00 7,915 00
02/01/2011 135 935 00 135,935 00 146,770 00 10,835 00
02/01/2012 137 250 00 137,250 00 145,785 00 8,535 00
02/01/2013 133,282 50 133,282 50 144 460 00 11,177 50
02/01/2014 134,200 00 134,200 00 142 790 00 8,590 00
02/01/2015 134,820 00 134 820 00 145,770 00 10,950 00
02/01/2016 135,070 00 135 070 00 143,100 00 8,030 00
Total $1,361,049 38 (3 970 74) $113 060 00 $1,470,138 64 $1,571,115 00 $100,976 36
PV Analysis Summary (Net to Net)
Net FV Cashflow Savings
Gross PV Debt Service Savings
$1,120,000
City of Rosemount, Minnesota
General Obligation Fire Station Refunding Bonds, Series 2005D
Current Refunding of Series 1996A
Net PV Cashflow Savings 3 555 %(Bond Yield)
Accrued Interest Credit to Debt Service Fund
Contingency or Rounding Amount
Net Future Value Benefit
Net Present Value Benefit
Net PV Benefit $323 279 25 PV Refunded Interest
Net PV Benefit $1,200,994 05 PV Refunded Debt Service
Net PV Benefit $1,085,000 Refunded Principal
Net PV Benefit $1,120,000 Refunding Principal
Refunding Bond Information
Refunding Dated Date
Refunding Delivery Date
1 The estimated raving' 1 e ruBc of the refunding are subject to mardct conditions
Sena 2005 Ref 96A 1 MVJ n'AEOSE 7/27/2005 I 1057AM
springsted
Debt Service Comparison
100,976 36
80,781 73
80,781 73
21232
3,490 00
$104,678 68
$84,484 05
26 133%
7 035%
7 787%
7 543%
11/01/2005
11/03/2005
Page 14
DETAILS OF THE BONDS
The Bonds will be dated November 1, 2005, as the date of original issue, and will bear interest
payable on August 1 and February 1 of each year, commencing August 1, 2006. Interest will
be computed on the basis of a 360 -day year of twelve 30 -day months
The Bonds will mature February 1 in the years and amounts as follows.
2007 $235,000 2011 $295,000 2014 $325,000
2008 $270,000 2012 $305,000 2015 $335,000
2009 $275,000 2013 $315,000 2016 $350,000
2010 $285,000
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds All term bonds shall be subject to mandatory sinking fund redemption
and must conform to the maturity schedule set forth above at a price of par plus accrued
interest to the date of redemption In order to designate term bonds, the proposal must specify
"Years of Term Maturities" in the spaces provided on the Proposal Form
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
registered in the name of Cede Co as nominee of The Depository Trust Company "DTC
New York, New York, which will act as securities depository of the Bonds Individual purchases
of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single
maturity through book entries made on the books and records of DTC and its participants
Principal and interest are payable by the registrar to DTC or its nominee as registered owner of
the Bonds Transfer of principal and interest payments to participants of DTC will be the
responsibility of DTC, transfer of principal and interest payments to beneficial owners by
participants will be the responsibility of such participants and other nominees of beneficial
owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the
Bonds with DTC
REGISTRAR
The City will name the registrar, which shall be subject to applicable SEC regulations The City
will pay for the services of the registrar.
OPTIONAL REDEMPTION
The City may elect on February 1, 2013, and on any day thereafter, to prepay Bonds due on or
after February 1, 2014 Redemption may be in whole or in part and if in part at the option of the
City and in such manner as the City shall determine. If less than all Bonds of a maturity are
called for redemption, the City will notify DTC of the particular amount of such maturity to be
prepaid DTC will determine by lot the amount of each participant's interest in such maturity to
be redeemed and each participant will then select by lot the beneficial ownership interests in
such maturity to be redeemed All prepayments shall be at a price of par plus accrued interest.
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem Taxes In addition, the City will pledge net
revenues of the City s water utility system The proceeds will be used to finance the acquisition
and construction of a water tower within the City
Page 16
TYPE OF PROPOSALS
Proposals shall be for not less than $2,966,080 and accrued interest on the total principal
amount of the Bonds Proposals shall be accompanied by a Good Faith Deposit "Deposit in
the form of a certified or cashier's check or a Financial Surety Bond in the amount of $29,900,
payable to the order of the City If a check is used, it must accompany the proposal If a
Financial Surety Bond is used, it must be from an insurance company licensed to issue such a
bond in the State of Minnesota, and preapproved by the City Such bond must be submitted to
Springsted Incorporated prior to the opening of the proposals The Financial Surety Bond must
identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond If the
Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is
required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's
check or wire transfer as instructed by Springsted Incorporated not later than 3 30 P.M., Central
Time, on the next business day following the award If such Deposit is not received by that
time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement.
The Deposit received from the purchaser, the amount of which will be deducted at settlement
and no interest will accrue to the purchaser, will be deposited by the City. In the event the
purchaser fails to comply with the accepted proposal, said amount will be retained by the City
No proposal can be withdrawn or amended after the time set for receiving proposals unless the
meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to
another date without award of the Bonds having been made Rates shall be in integral
multiples of 5/100 or 1/8 of 1 Rates must be in level or ascending order. Bonds of the same
maturity shall bear a single rate from the date of the Bonds to the date of maturity No
conditional proposals will be accepted
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling.
The City will reserve the right to. (i) waive non substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals
without cause, and (iii) reject any proposal that the City determines to have failed to comply with
the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of
the Bonds Any increased costs of issuance of the Bonds resulting from such purchase of
insurance shall be paid by the purchaser, except that, if the City has requested and received a
rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating
agency fees shall be the responsibility of the purchaser
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Page 17
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser
SETTLEMENT
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser through DTC in New York, New York Delivery will be subject to receipt by the
purchaser of an approving legal opinion of Briggs and Morgan, Professional Association, of
Saint Paul and Minneapolis, Minnesota, and of customary closing papers, including a no-
litigation certificate Orf the date of settlement, payment for the Bonds shall be made in federal,
or equivalent, funds that shall be received at the offices of the City or its designee not later than
12 00 Noon, Central Time Unless compliance with the terms of payment for the Bonds has
been made impossible by action of the City, or its agents, the purchaser shall be liable to the
City for any loss suffered by the City by reason of the purchaser's non compliance with said
terms for payment
CONTINUING DISCLOSURE
On the date of actual issuance and delivery of the Bonds, the City will execute and deliver a
Continuing Disclosure Undertaking (the "Undertaking whereunder the City will covenant for
the benefit of the owners of the Bonds to provide certain financial and other information about
the City and notices of certain occurrences to information repositories as specified in and
required by SEC Rule 15c2- 12(b)(5)
OFFICIAL STATEMENT
The City has authorized the preparation of an Official Statement containing pertinent
information relative to the Bonds, and said Official Statement will serve as a nearly final Official
Statement within the meaning of Rule 15c2 -12 of the Securities and Exchange Commission.
For copies of the Official Statement or for any additional information prior to sale, any
prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated,
380 Jackson Street, Suite 300, Saint Paul, Minnesota 55101, telephone (651) 223 -3000
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2 -12 By awarding the Bonds to any
underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no
more than seven business days after the date of such award, it shall provide without cost to the
senior managing underwriter of the syndicate to which the Bonds are awarded 120 copies of
the Official Statement and the addendum or addenda described above The City designates
the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent
for purposes of distributing copies of the Final Official Statement to each Participating
Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby
that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall
enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes
of assuring the receipt by each such Participatino Underwriter of the Final Official Statement.
Dated September 6, 2005 BY ORDER OF THE CITY COUNCIL
/s/ Linda Jentink
City Clerk
Page 18
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS:
Proposals for the Bonds will be received on Tuesday, October 4, 2005, until 12:00 Noon,
Central Time, at the offices of Springsted Incorporated, 380 Jackson Street, Suite 300, Saint
Paul, Minnesota, after which time they will be opened and tabulated. Consideration for award
of the Bonds will be by the City Council at 7 30 P M., Central Time, of the same day
OR
TERMS OF PROPOSAL
$1,120,000"
CITY OF ROSEMOUNT, MINNESOTA
GENERAL OBLIGATION FIRE STATION REFUNDING BONDS, SERIES 2005D
(BOOK ENTRY ONLY)
SUBMISSION OF PROPOSALS
Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the
time of sale specified above All bidders are advised that each Proposal shall be deemed to
constitute a contract between the bidder and the City to purchase the Bonds regardless of the
manner in which the Proposal is submitted.
(a) Sealed Bidding. Proposals may be submitted in a sealed envelope or by fax
(651) 223-3046 to Springsted Signed Proposals, without final price or coupons, may be
submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting
to Springsted the final Proposal price and coupons, by telephone (651) 223-3000 or fax
(651) 223 -3046 for inclusion in the submitted Proposal.
(b) Electronic Bidding. Notice is hereby given that electronic proposals will be received via
PARITY' For purposes of the electronic bidding process, the time as maintained by PARITY
shall constitute the official time with respect to all Bids submitted to PARITY Each bidder
shall be solely responsible for making necessary arrangements to access PARITY for
purposes of submitting its electronic Bid in a timely manner and in compliance with the
requirements of the Terms of Proposal Neither the City, its agents nor PARITY shall have
any duty or obligation to undertake registration to bid for any prospective bidder or to provide or
ensure electronic access to any qualified prospective bidder, and neither the City, its agents nor
PARITY shall be responsible for a bidders failure to register to bid or for any failure in the
proper operation of, or have any liability for any delays or interruptions of or any damages
caused by the services of PARITY The City is using the services of PARITY solely as a
communication mechanism to conduct the electronic bidding for the Bonds, and PARITY' is not
an agent of the City.
If any provisions of this Terms of Proposal conflict with information provided by PARITY this
Terms of Proposal shall control Further information about PARITY including any fee
charged, may be obtained from
PARITY 1359 Broadway, 2 Floor. New York, New York 10018
Customer Support (212) 849 -5000
Page 19
2007 90,000
2008 $100,000
2009 $105,000
2010 $110,000
DETAILS OF THE BONDS
The Bonds will be dated November 1, 2005, as the date of original issue, and will bear interest
payable on August 1 and February 1 of each year, commencing August 1, 2006. Interest will
be computed on the basis of a 360 -day year of twelve 30 -day months
The Bonds will mature February 1 in the years and amounts as follows:
2011 $110,000
2012 $115,000
2013 $115,000
The City reserves the right, after proposals are opened and prior to award, to increase or reduce the
principal amount of the Bonds offered for sale Any such increase or reduction will be made in
multiples of $5,000 in any of the maturities. In the event the prncipal amount of the Bonds is
increased or reduced, any premium offered or any discount taken by the successful bidder will be
increased or reduced by a percentage equal to the percentage by which the principal amount of the
Bonds is increased or reduced
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds All term bonds shall be subject to mandatory sinking fund redemption
and must conform to the maturity schedule set forth above at a price of par plus accrued
interest to the date of redemption In order to designate term bonds, the proposal must specify
"Years of Term Maturities" in the spaces provided on the Proposal Form
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
registered in the name of Cede Co. as nominee of The Depository Trust Company "DTC
New York, New York, which will act as securities depository of the Bonds. Individual purchases
of the Bonds may be made in the principal amount of S5 000 or any multiple thereof of a single
maturity through book entries made on the books and records of DTC and its participants
Principal and interest are payable by the registrar to DTC or its nominee as registered owner of
the Bonds. Transfer of principal and interest payments to participants of DTC will be the
responsibility of DTC, transfer of principal and i nterest payments to beneficial owners by
participants will be the responsibility of such participants and other nominees of beneficial
owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the
Bonds with DTC.
REGISTRAR
2014 $120,000
2015 $125,000
2016 $130,000
The City will name the registrar, which shall be subject to applicable SEC regulations The City
will pay for the services of the registrar
OPTIONAL REDEMPTION
The Bonds will not be subject to payment in advance of their respective stated maturity dates
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes The proceeds will be used to refund
the February 1, 2007 through February 1, 2016 maturities of the City's General Obligation Fire
Station Bonds, Series 1996A, dated July 1, 1996
Page 20
TYPE OF PROPOSALS
Proposals shall be for not less than $1,112,440 and accrued interest on the total principal
amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit "Deposit in
the form of a certified or cashier's check or a Financial Surety Bond in the amount of $11,200,
payable to the order of the City If a check is used, it must accompany the proposal If a
Financial Surety Bond is used, it must be from an insurance company licensed to issue such a
bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to
Springsted Incorporated prior to the opening of the proposals The Financial Surety Bond must
identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond If the
Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is
required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's
check or wire transfer as instructed by Springsted Incorporated not later than 3 :30 P M Central
Time, on the next business day following the award If such Deposit is not received by that
time. the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement.
The Deposit received from the purchaser, the amount of which will be deducted at settlement
and no interest will accrue to the purchaser, will be deposited by the City. In the event the
purchaser fails to comply with the accepted proposal, said amount will be retained by the City
No proposal can be withdrawn or amended after the time set for receiving proposals unless the
meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to
another date without award of the Bonds having been made. Rates shall be in integral
multiples of 5/100 or 1/8 of 1% Rates must be in level or ascending order Bonds of the same
maturity shall bear a single rate from the date of the Bonds to the date of maturity. No
conditional proposals will be accepted
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling
The City will reserve the right to (i) waive non substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals
without cause, and On) reject any proposal that the City determines to have failed to comply with
the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of
the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of
insurance shall be paid by the purchaser, except that t the City has requested and received a
rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating
agency fees shall be the responsibility of the purchaser
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds.
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Page 21
f
Bonds The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser
SETTLEMENT
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser through DTC in New York, New York Delivery will be subject to receipt by the
purchaser of an approving legal opinion of Briggs and Morgan, Professional Association, of
Saint Paul and Minneapolis, Minnesota, and of customary closing papers, including a no-
litigation certificate. Orr the date of settlement, payment for the Bonds shall be made in federal,
or equivalent, funds that shall be received at the offices of the City or its designee not later than
12 00 Noon, Central Time Unless compliance with the terms of payment for the Bonds has
been made impossible by action of the City, or its agents, the purchaser shall be liable to the
City for any loss suffered by the City by reason of the purchaser's non compliance with said
terms for payment.
CONTINUING DISCLOSURE
On the date of actual issuance and delivery of the Bonds, the City will execute and deliver a
Continuing Disclosure Undertaking (the "Undertaking whereunder the City will covenant for
the benefit of the owners of the Bonds to provide certain financial and other information about
the City and notices of certain occurrences to information repositories as specified in and
required by SEC Rule 15c2- 12(b)(5).
OFFICIAL STATEMENT
The City has authorized the preparation of an Official Statement containing pertinent
information relative to the Bonds, and said Official Statement will serve as a nearly final Official
Statement within the meaning of Rule 15c2 -12 of the Securities and Exchange Commission.
For copies of the Official Statement or for any additional information prior to sale, any
prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated,
330 Jackson Street, Suite 300, Saint Paul, Minnesota 55101, telephone (651) 223 -3000
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2 -12 By awarding the Bonds to any
underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no
more than seven business days after the date of such award, it shall provide without cost to the
senior managing underwriter of the syndicate to which the Bonds are awarded 50 copies of the
Official Statement and the addendum or addenda described above The City designates the
senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for
purposes of distributing copies of the Final Official Statement to each Participating Underwriter.
Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its
proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a
contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring
the receipt by each such Participating Underwriter of the Final Official Statement
Dated September 6, 2005 BY ORDER OF THE CITY COUNCIL
/s/ Linda Jentink
City Clerk
Page 22