HomeMy WebLinkAbout8.b. Accept Bids and Award Sale - G.O. Improvement Bonds, Series 2006BAGENDA ITEM: Accept Bids and Award Sale G 0
Improvement Bonds, Series 2006B
AGENDA SECTION:
Old Business
PREPARED BY: Jeff May, Finance Director
AGEN i t'. 4�
ATTACHMENTS: Resolution (Official Statement with
2006A Agenda Item)
APPROVED BY:
RECOMMENDED ACTION: Motion to adopt a Resolution Accepting Offer on the Sale of
$4,405,000 General Obligation Improvement Bonds, Series 2006B, Providing for their
Issuance and Levying a Tax for the Payment thereof.
ACTION:
CITY OF ROSEMOUNT
EXECUTIVE SUMMARY FOR ACTION
Special City Council Meeting Date: May 16, 2006
ISSUE Accept bids and award sale of bonds for improvements to Old County
Road 38, City Project #387
BACKGROUND This item is on the agenda for Council to formally award the sale of
bonds for improvements to Old County Road 38. At 12 00 P.M. Tuesday, May 16, 2006,
sealed bids for G 0 Improvement Bonds, Series 2006B, will be opened and the results
tabulated at the offices of Springsted, our financial consultants for the sale A representative
from Springsted will be at the Council meeting that evening to give their recommendation for
the issuance of these bonds and to answer any questions that you may have.
Because the bid opening is not until earlier in the day Tuesday, you will receive information
regarding the bids at the meeting that evening
SUMMARY
Recommend the above motion.
WHEREAS, the City Council of the City of Rosemount, Minnesota (the "City has heretofore
determined and declared that it is necessary and expedient to issue $4,405,000 General Obhgatton
Improvement Bonds, Series 2006B (the "Bonds of the City, pursuant to Minnesota Statutes,
Chapters 429 and 475, to finance the construction of vanous nnprovements in the City (the
"Improvements and
WHEREAS, the construction of the Improvements to be financed by the Bonds has heretofore
been ordered, and
WHEREAS, offers to purchase the Bonds were solicited on behalf of the City by Springsted
Incorporated, and
WHEREAS, the City has retained Sprmgsted Incorporated, in St. Paul, Minnesota ("Springsted"),
as its independent financial advisor for the sale of the Bonds and is therefore authorized to sell the
Bonds by pnvate negotiation m accordance with Minnesota Statutes, Section 475 60, Subdivision
2(9); and
WHEREAS, the following offers were received, opened and recorded at the offices of Springsted
Incorporated at 12.00 Noon, this same day.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Rosemount,
Minnesota, as follows:
1. Acceptance of Offer The offer of
(the "Purchaser to purchase $4,405,000 General Obligation Improvement Bonds, Series 2006B of
the City (the "Bonds or individually a "Bond in accordance with the terms of proposal, at the
rates of interest hereinafter set forth, and to pay therefor the sum of plus interest
accrued to settlement, is hereby found, determined and declared to be the most favorable offer
received and is hereby accepted, and the Bonds are hereby awarded to said Purchaser The Finance
Director is directed to retain the deposit of said Purchaser and to forthwith return to the others
making offers their good faith checks or drafts
1899771v1
Bidder
CITY OF ROSEMOUNT
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2006
RESOLUTION ACCEPTING OFFER ON THE
SALE OF $4,405,000 GENERAL OBLIGATION IMPROVEMENT
BONDS, SERIES 2006B, PROVIDING FOR THEIR ISSUANCE
AND LEVYING A TAX FOR THE PAYMENT THEREOF
Interest Rate Net Interest Cost
2. Terms of Bonds.
(a) Title; Onguial Issue Date; Denominations; Matunnes; Term Bond Option. The Bonds shall
be titled "General Obligation Improvement Bonds, Series 2006B shall be dated June 1, 2006, as the
date of ongmal issue and shall be issued forthwith on or after such date as fully registered bonds.
The Bonds shall be numbered from R -1 upward in the denomination of $5,000 each or m any
integral muluple thereof of a single maturity (the "Authonzed Denomination The Bonds shall
mature on February 1 in the years and amounts as follows:
Year Amount Year Amount
2008 $440,000 2013 $440,000
2009 425,000 2014 445,000
2010 425,000 2015 450,000
2011 430,000 2016 455,000
2012 435,000 2017 460,000
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 apphcable
Bond(s).
(b) Book Entry Onlwstem. The Depository Trust Company, a hmited 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 Penod"), 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 5 (with respect to redemption) and 10 (with respect to registration, transfer and
exchange) 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
(u) Upon initial issuance, ownership of the Bonds shall be registered in a bond register
maintained by U S Bank National Association in St Paul, Minnesota (the "Bond Registrar in the
name of CEDE CO., as the nominee (it or any nominee of the existing or a successor Depository,
the "Nominee
(in) With respect to the Bonds neither the City nor the Bond Registrar shall have any
responsibility or obhgation 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 m 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 dehvery 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
1899771x1
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 purposes 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 vand and effective to fully satisfy and discharge the City's obhgations with
respect to the principal of and prenuum, if any, and interest on the Bonds to the extent of the sum
or sums so paid.
(v) Upon dehvery by the Depository to the Bond Registrar of wntten 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 10 hereof (with respect to registration, transfer and
exchange) 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 pohcies referenced therein or apphcable 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.
(vin) 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
(ix) Any successor Bond Registrar m 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 heu of surrendering the
Bonds for a Bond of a lesser denomination as provided m paragraph 5 hereof (with respect to
redemption), make a notation of the reduction m principal amount on the panel provided on the
Bond stating the amount so redeemed
(c) Termination of Book -Entry Only System. Discontinuance of a particular Depository's
services and termination of the book -entry only system may be effected as follows
1899771v1
(t) 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 responsibthnes with
respect thereto under apphcable law. The City may terminate the services of the Depository with
respect to the Bonds if it determines that the Depository is no longer able to carry out its functions
as securities depository or the continuation of the system 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 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 deternunes that it is m the best
interests of the City or the Beneficial Owners of the Bonds 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 10 hereof (with
respect to registration, transfer and exchange) To the extent that the Beneficial Owners are
designated as the transferee by the Holders, in accordance with paragraph 10 hereof (with respect to
registration, transfer and exchange), the Bonds will be delivered to the Beneficial Owners.
(ni) Nothing in this subparagraph (c) shall hmit or restrict the provisions of paragraph 10 hereof
(with respect to registration, transfer and exchange)
(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. Purpose. The Bonds shall provide funds to finance the costs of various improvements
within the City (the "Improvements The total cost of the Improvements, which shall include all
costs enumerated m Minnesota Statutes, Section 475.65, is estimated to be at least equal to the
amount of the Bonds. Work on the Improvements shall proceed with due diligence to completion
The City covenants that it shall do all things and perform all acts required of it to assure that work
on the Improvements proceed with due diligence to completion and that any and all permits and
studies required under law for the Improvements are obtained.
4. Interest The Bonds shall bear interest payable semiannually on February 1 and August 1 of
each year (each, an "Interest Payment Date commencing February 1, 2007, 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 Interest Maturity Interest
Year Rate Year Rate
"/o
2008 2013
2009 2014
2010 2015
2011 2016
2012 2017
5. Redemption All Bonds maturing in the years 2016 and 2017 shall be subject to redemption
and prepayment at the option of the City on February 1, 2015, and on any date thereafter at a pnce
of par plus accrued interest. Redemption may be in whole or in part of the Bonds subject to
prepayment. If redemption is m part, the City shall determine the maturities and principal amounts
18997711
withm each maturity to be prepaid; 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
redempuon shall be given to the paying agent and to each affected registered holder of the Bonds.
To effect a partial redemption of Bonds having a common matunty 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 District or Bond Registrar so requires, a written
instrument of transfer in form satisfactory to the Distract and Bond Registrar duly executed by the
holder thereof or his, her or its attorney duly authorized in writing) and the District shall execute (if
necessary) and the Bond Registrar shall authenticate and dehver to the Holder of such Bond,
without service charge, a new Bond or Bonds of the same series having the same stated matunty and
interest rate and of any authorized denomination or denominations, as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of
the Bond so surrendered.
6. Bond Registrar. U.S. Bank National Association in St Paul, 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 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 12 of this resolution (with respect to interest
payment and record date).
7. 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.
1899771v1
UNI'T'ED STATES OF AMERICA
STATE OF MINNESOTA
DAKOTA COUNTY
CITY OF ROSEMOUNT
R-
INTEREST MATURITY DATE OF
RATE DATE ORIGINAL ISSUE
June 1, 2006
REGISTERED OWNER: CEDE CO.
GENERAL OBLIGATION IMPROVEMENT
BOND, SERIES 2006B
PRINCIPAL AMOUNT: DOLLARS
CUSIP
KNOW ALL PERSONS BY THESE PRESENTS that the City of Rosemount, Dakota 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 earher
redemption, and to pay interest thereon semiannually on February 1 and August 1 of each year
(each, an "Interest Payment Date commencing February 1, 2007, at the rate per annum specified
above (calculated on the basis of a 360 -day year of twelve 30 -day months) until the pnncipal 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 onginal issue
hereof. The principal of and premium, if any, on this Bond are payable upon presentation and
surrender hereof at the principal office of U.S. Bank National Association in St Paul, 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 m 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 next preceding such
Interest Payment Date (the "Regular Record Date Any mterest 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 pnor to the Special Record Date. The pnncipal of and premium, if any, and interest on this
Bond are payable m 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, 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 Resoluuon, 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 system pursuant to the Resolution, Bonds may only be registered
in the name of the Depository or its Nominee.
Redemption. All Bonds of this issue (the "Bonds maturing in the years 2016 and 2017 are subject
to redemption and prepayment at the option of the Issuer on February 1, 2015, and on any date
thereafter at a price of par plus accrued interest. Redemption may be in whole or in part of the
1899771v1
Bonds subject to prepayment. If redemption is in part, the City shall determine the matunues and
principal amount w ithin each maturity to be prepaid; 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
Selection of Bonds for Redemption; Partial Redemption. To effect a partial redemption of Bonds
having a common maturity date, the Bond Registrar 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 m its
discretion, from the numbers assigned to the 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 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 m part, it shall be surrendered to the Bond Registrar (with, if the Issuer or Bond
Registrar so requires, a written instrument of transfer in form satisfactory to the Issuer and Bond
Registrar duly executed by the Holder thereof or his, her or its attorney duly authorized in writing)
and the Issuer shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to
the Holder of such Bond, without service charge, a new Bond or Bonds of the same series having
the same stated maturity and interest rate and of any authorized denorrunauon or denominations, as
requested by such Holder, in aggregate principal amount equal to and m exchange for the
unredeemed portion of the principal of the Bond so surrendered.
Issuance; Purpose; General Obhganon. This Bond is one of an issue in the total principal amount
of $4,405,000, all of like date of original issue and tenor, except as to number, maturity, interest rate,
denomination and redemption privilege, which Bond has been 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 of the Issuer on May 16, 2006 (the "Resolution for the purpose of
providing funds to finance the costs of vanous improvement projects v ithin the jurisdiction of the
Issuer This Bond is payable out of the General Obhgation Improvement Bonds, Serves 2006B
Fund of the Issuer 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 as fully registered bonds m
the Authorized Denominations (as defined in the Resolution) and are exchangeable for fully
registered Bonds of other Authorized Denominations m equal aggregate principal amounts at the
principal office of the Bond Registrar, but only in the manner and subject to the hnutanons provided
in the Resolution. Reference is hereby made to the Resolution for a descnption of the nghts and
duties of the Bond Registrar. Copies of the Resolution are on file in the principal office of the Bond
Registrar
Transfer This Bond is transferable by the Holder in person or by his, her or its attorney duly
authorized m 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 m any agreement with the Bond Registrar.
Thereupon the Issuer shall execute and the Bond Registrai shall authenticate and deliver, in
exchange for this Bond, one or more new fully registered Bonds m the name of the transferee but
not registered in blank or to "bearer" or similar designation), of an Authorized Denomination or
1899771v1
Denominations, m 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 m 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 m whose
name this Bond is registered as the owner hereof for the purpose of receiving payment as herein
provided (except as otherwise provided on the reverse side hereof with respect to the Record Date)
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 Ceruficate of Authentication hereon shall have been executed by the Bond
Registrar.
nuahfled 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 constitutional, or
statutory limitation of indebtedness.
IN WITNESS WHEREOF, the City of Rosemount, Dakota 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
Clerk, the corporate seal of the Issuer having been intentionally omitted as permitted by law.
18997710
Date of Registration Registrable by:
2006
U.S. Bank National Associauon
St Paul, Minnesota
Bond Registrar
By
Authorized Signature
}899771v1
Payable at:
U.S Bank National
Association
St Paul, Minnesota
U.S. Bank National
Association
St Paul, Minnesota
BOND REGISTRAR'S
CERTIFICATE OF AUTHENTICATION CITY OF ROSEMOUNT,
This Bond is one of the DAKOTA COUNTY, MINNESOTA
Bonds described in the
Resolution mentioned
Within. /s/ Facsimile
Mayor
/s/ Facsimile
Clerk
ABBREVIATIONS
The following abbreviations, when used m the inscription on the face of this Bond, shall be
construed as though they were written out m full according to applicable laws or regulations.
TEN COM as tenants in common
TEN ENT as tenants by the entireties
JT TEN as lomt tenants with right of survivorship
and not as tenants m common
UTMA as custodian for
(Cust) (Minor)
under the Uniform
(State)
Transfers to Minors Act
1899771v1
Additional abbreviations may also be used
though not in the above list.
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 m the
prermses.
Dated:
Notice:
Signature Guaranteed:
Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm having a
membership m 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.
1899771v1
ASSIGNMENT
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.
(Include information for all joint owners
if the Bond is held by jomt account.)
1899771v1
[Use only for Bonds when they are
Registered in Book Entry Only System]
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
8. Execuuorr Temporary Bonds. The Bonds shall be printed (or, at the request of the
Purchaser, typewritten) executed on behalf of the City by the signatures of its Mayor and Clerk and
be sealed with the seal of the City; provided, however, that the seal of the City may be a printed (or,
at the request of the Purchaser, photocopied) facsimile; and provided further that both of such
signatures may be printed (or, at the request of the Purchaser, photocopied) facsimiles and the
corporate seal may be omitted on the Bonds as permitted by law In the event of disability or
resignation or other absence of either such officer, the Bonds may be signed by the manual or
facsunile signature of that officer who may act on behalf of such absent or disabled officer In case
either such officer whose signature or facsimile of whose signature shall appear on the Bonds shall
cease to be such officer before the dehvery of the Bonds, such signature or facsimile shall
nevertheless be vand and sufficient for all purposes, the same as if he or she had remained in office
until delivery. The City may elect to deliver, in heu of printed defrmuve bonds, one or more
typewritten temporary bonds m substantially the form set forth above, with such changes as may be
necessary to reflect more than one maturity in a single temporary bond Such temporary bonds may
be executed with photocopied facsimile signatures of the Mayor and Clerk. Such temporary bonds
shall, upon the printing of the definitive bonds and the execution thereof, be exchanged therefor
and cancelled.
9. Authentication. No Bond shall be vand 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 m the form heremabove 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 Authenucauon 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 ongmal Bonds to the Purchaser, the Bond Registrar shall insert as
a date of registration the date of original issue, which date is June 1, 2006. The Certificate of
Authenucauon so executed on each Bond shall be conclusive evidence that it has been authenucated
and delivered under this resolution
10. 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 9 with respect to authentication) 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 hke aggregate principal amount, having the same stated maturity and interest
rate, as requested by the transferor, provided, however, that no Bond may be registered m blank or
in the name of "bearer" or similar designation
At the option of the Holder, Bonds may be exchanged for Bonds of any Authonzed Denomination
or Denonunations of a like aggregate principal amount and stated maturity, upon surrender of the
Bonds to be exchanged at the pnncrpal 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 cancelled by the Bond Registrar and thereafter disposed of as directed by the City.
1899771v1
All Bonds delivered in exchange for or upon transfer of Bonds shall be valid general obhgauons 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
11. Rights Upon Transfer or Exchange. Each Bond delivered upon transfer of or m exchange
for or m heu of any other Bond shall carry all the rights to interest accrued and unpaid, and to
accrue, which were carried by such other Bond.
12. Interest Payment; Record Date. Interest on any Bond shall be paid on each Interest
Payment Date by check or draft mailed to the person m 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 fifteenth (15th) day of the calendar month next
preceding such Interest Payment Date (the "Regular Record Date Any such interest not so umely
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 fated by the Bond Registrar whenever money becomes available for
payment of the defaulted interest. Nouce of the Special Record Date shall be given by the Bond
Registrar to the Holders not less than ten (10) days prior to the Special Record Date.
13 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 12
above with respect to interest payment and record date) 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.
14. Delivery; Apphcation of Proceeds The Bonds when so prepared and executed shall be
dehvered by the Finance Director to the Purchaser upon receipt of the purchase pace, and the
Purchaser shall not be obhged to see to the proper application thereof.
15. Fund and Accounts. There is hereby created a special fund to be designated the "General
Obligation Improvement Bonds, Series 2006B Fund" (the "Fund to be administered and
maintained by the Finance Director as a bookkeeping account separate and apart from all other
funds mamtamed in the official financial records of the City. The Fund shall be maintained m the
manner herein specified until all of the Bonds and the interest thereon have been fully paid There
shall be maintained in the Fund two (2) separate accounts, to be designated the "Construction
Account" and "Debt Service Account respectively.
(i) Construction Account. To the Construction Account there shall be credited the proceeds of
the sale of the Bonds, less accrued interest received thereon, less any amount paid for the Bonds in
1899771v1
excess of $4,369,760, and less capttahzed interest in the amount of $113,791.67 (together with
interest earnings thereon and subject to such other adjustments as are appropriate to provide
sufficient funds to pay interest due on the Bonds on or before February 1, 2007), plus any special
assessments levied with respect to the Improvements and collected prior to completion of the
Improvements and payment of the costs thereof. From the Construction Account there shall be
paid all costs and expenses of making the Improvements hsted m paragraph 16, including the cost of
any construction contracts heretofore let and all other costs incurred and to be incurred of the kind
authonzed m Minnesota Statutes, Section 475.65, and the moneys in said account shall be used for
no other purpose except as otherwise provided by law, provided that the proceeds of the Bonds may
also be used to the extent necessary to pay interest on the Bonds due pnor to the anucipated date of
commencement of the collecuon of taxes or special assessments herein or hereafter levied or
covenanted to be levied, and provided further that if upon completion of the Improvements there
shall remain any unexpended balance m the Construcuon Account, the balance (other than any
special assessments) may be transferred by the Council to the fund of any other improvement
instituted pursuant to Minnesota Statutes, Chapter 429, and provided further that any special
assessments credited to the Construction Account shall only be apphed towards payment of the
costs of the Improvements upon adoption of a resolution by the City Council determining that the
application of the special assessments for such purpose will not cause the City to no longer be in
compliance with Minnesota Statutes, Section 475.61, Subdivision 1.
(u)
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Debt Service Account. There are hereby irrevocably appropriated and pledged to, and there
shall be credited to, the Debt Service Account: (a) all collections of special assessments herein
covenanted to be levied with respect to the Improvements and either initially credited to the
Construction Account and not already spent as permitted above and required to pay any principal
and interest due on the Bonds or collected subsequent to the completion of the Improvements and
payment of the costs thereof, (b) all accrued interest received upon delivery of the Bonds, (c) all
funds paid for the Bonds in excess of $4,369,760, (d) capitahzed interest in the amount of
$113,791 67 (together with interest earnings thereon and subject to such other adjustments as are
appropriate to provide sufficient funds to pay interest due on the Bonds on or before February 1,
2007); (e) any collecuons of taxes herein or hereafter levied for the payment of the Bonds and
interest thereon, (0 all funds remaining in the Construction Account after completion of the
Improvements and payment of the costs thereof, not so transferred to the account of another
improvement, (g) all investment earnings on funds held in the Debt Service Account; and (h) any
and all other moneys, which are properly available and are appropnated by the governing body of
the City to the Debt Service Account. The Debt Service Account shall be used solely to pay the
principal and interest and any premiums for redemption of the Bonds and any other general
obhgauon bonds of the City hereafter issued by the City and made payable from said account 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 (1) for a reasonable temporary period until such proceeds are needed
for the purpose for which the Bonds were issued and (2) m addition to the above in an amount not
greater than the lesser of five percent (5 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 m the Construction Account
or the Debt Service Account (or any other City account which will be used to pay principal or
interest to become due on the Bonds payable therefrom), in excess of amounts which under
then apphcable 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 said arbitrage regulations
on such investments after taking into account any apphcable 'temporary- periods" or "minor
portion" made available under the federal arbitrage regulations Money in the Fund shall not be
invested m obhgauons or deposits issued by, guaranteed by or insured by the United States or any
agency or mstrumentahty 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
16. Assessments It is hereby deternned that no less than twenty percent (20 of the cost to
the City of each Improvement financed hereunder within the meaning of Minnesota Statutes,
Section 475 58, Subdivision 1(3), shall be paid by special assessments to be levied against every
assessable lot, piece and parcel of land benefitted by any of the Improvements The City hereby
covenants and agrees that it will let all construction contracts not heretofore let within one (1) year
after ordering each Improvement financed hereunder unless the resolution ordering the
Improvement specifies a different time limn for the letting of construction contracts. The City
hereby further covenants and agrees that it will do and perform as soon as they may be done all acts
and things necessary for the final and vand levy of such special assessments, and in the event that
any such assessment be at any time held mvand with respect to any lot, piece or parcel of land due to
any error, defect, or irregularity m any action or proceedings taken or to be taken by the City or the
City Council or any of the City officers or employees, either in the making of the assessments or m
the performance of any condition precedent thereto, the City and the City Council will forthwith do
all further acts and take all further proceedings as may be required by law to make the assessments a
vand and binding hen upon such property. The special assessments have heretofore been
authorized Subject to such adjustments as are required by conditions m existence at the time the
assessments are levied, it is hereby determined that the assessments shall be payable with general
taxes for the years shown below in equal, consecutive, annual installments of principal, and with
interest on the dechrung balance of all such assessments at a rate per annum not greater than the
maximum permitted by law and not less than per annum:
Improvement Collection
Designation Amount Levy Years Years
Old County Road 38
At the time the assessments are in fact levied the City Council shall, based on the then current
estimated collections of the assessments, make any adjustments in any ad valorem taxes required to
be levied m order to assure that the City continues to be m comphance with Minnesota Statutes,
Section 475.61, Subdivision 1.
17. Tax Levy; Coverage Test. To provide moneys for payment of the principal and interest on
the Bonds there has heretofore and there is hereby levied upon all of the taxable property m 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 m the City for the years and m the amounts as follows.
18997710
Year of Tax Year of Tax
Levy Collection
2006 2007
2007 2008
2008 2009
2009 2010
2010 2011
2011 2012
2012 2013
2013 2014
2014 2015
2015 2016
$2,265,557 2006 -2015 2007 -2016
Amount
The tax levies are such that if collected in full they, together with other revenues herein pledged for
the payment 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 Bonds The tax levies shall be irreparable
so long as any of the Bonds are outstanding and unpaid, provided that the City reserves the right
and power to reduce the levies in the manner and to the extent permitted by Minnesota Statutes,
Section 475.61, Subdivision 3
18. General Obhgation Pledge. For the prompt and full payment of the principal and interest
on 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 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.
19. Certificate of Registration and Tax Levy. The Clerk is hereby directed to file a certified copy
of this resolution with the County Auditor /Treasurer of Dakota County, Minnesota, together with
such other information as he or she shall require, and to obtain the County Auditor's certificate that
the Bonds have been entered in the County Auditor/Treasurer's Bond Register and the tax levy
required by law has been made
20 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 legahty and marketability of the Bonds as the same
appear from the books and records under their custody and control or as otherwise known to them,
and all such certified copies, certificates and affidavits, including any heretofore furnished, shall be
deemed representations of the City as to the facts recited therein.
21. Negative Covenant as to Use of Proceeds and Improvements The City hereby covenants
not to use the proceeds of the Bonds or to use the Improvements, or to cause or permit them to be
used, or to enter into any deferred payment arrangements for the cost of the Improvements, in such
a manner as to cause the Bonds to be "pnvate activity bonds" within the meaning of Sections 103
and 141 through 150 of the Code.
22. Tax Exempt Status of the Bonds; Rebate. The City shall comply with requirements
necessary under the Code to estabhsh and maintain the exclusion from gross income under Section
103 of the Code of the interest on the Bonds, including without Imitation (1) requirements relating
to temporary periods for investments, (2) limitations on amounts invested at a yield greater than the
yield on the Bonds, and (3) the rebate of excess investment earnings to the United States. The
Issuer expects to satisfy the six month expenditure exempuon for gross proceeds of the Bonds as
provided m Section 1.148 7(d)(1) of the Regulations.
23. Designation of Ouahfied Tax Exempt Obhgauons. In order to qualify the Bonds as
"qualified tax- exempt obhgauons" within the meaning of Section 265(6)(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 Secuon 141 of the Code;
1899771v1
(c) the City hereby designates the Bonds as "quahfied tax- exempt obhgauons" for purposes of
Section 265(b)(3) of the Code;
(d) the reasonably anticipated amount of tax- exempt obligations (other than prwate 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 2006 will not exceed
$10,000,000, and
(e) not more than $10,000,000 of obhgations issued by the City during this calendar year 2006
have been designated for purposes of Section 265(b)(3) of the Code.
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
24. 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 obhgauons 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 tune 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 quahfied by law as an escrow
agent for this purpose, cash or securities descnbed in Minnesota Statutes, Section 475.67,
Subdivision 8, bearing interest payable at such tunes and at such rates and maturing on such dates as
shall be required, subject to sale and /or reinvestment, to pay all amounts to become due thereon to
maturity or, if nonce of redemption as herein required has been duly provided for, to such earher
redemption date.
25. 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 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 pnor to the Closing Date (a "Reimbursement
Expenditure
The City hereby certifies and /or covenants as follows:
(a) Not later than 60 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 effecuvely (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; (u) 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 (in) 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
1899771v1
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 20% of the "issue price"
of the Bonds, and (u) a de trntnmss amount of Reimbursement Expenditures not m excess of the
lesser of $100,000 or 5% of the proceeds of the Bonds.
(b) Each Reimbursement Expenditure is a capital expenditure or a cost of issuance 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 Bonds and m all events within the period ending on the date which is the later of 18
months after payment of the Reimbursement Expenditure 01 three years 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 wntmg that evidences the City's use
of Bond proceeds to reimburse the Reimbursement Expenditure and, if made within 30 days after
the Bonds are issued, shall be treated as made on the day the Bonds are issued.
Provided, however, that the City may take action contrary to any of the foregoing covenants in this
paragraph 25 upon receipt of an opinion of its Bond Counsel for the Bonds stating in effect that
such action will not impair the tax- exempt status of the Bonds.
26. Contmumg Disclosure.
(a) 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 Conti Disclosure Undertaking (the "Undertaking hereinafter described to:
(1) provide or cause to be provided to each nationally recognized municipal securities
information repository "NRMSIR and to the appropnate state information depository ("SID if
any, for the State of Minnesota, m each case as designated by the Commission m accordance with
the Rule, certain annual financial information and operating data in accordance with the
Undertaking. The City reserves the nght to modify from time to time the terms of the Undertaking
as provided therein.
(2) Provide or cause to be provided, in a timely manner, to (i) each NRMSIR or to the
Municipal Securities Rulemakmg Board "MSRB and (u) the SID, notice of the occurrence of
certain material events with respect to the Bonds in accordance with the Undertaking.
(3) Provide or cause to be provided, m a tunely manner, to (i) each NRMSIR or to the MSRB
and (ii) the SID, notice of a failure by the Issuer to provide the annual financial information with
respect to the Issuer described in the Undertaking.
(4) 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,
(b) The Mayor and Clerk 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
1899771x1
Undertaking m 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, (u) required
by the purchaser of the Bonds and (m) acceptable to the Officers.
27. Severabihty. If any section, paragraph or provision of this resolution shall be held to be
invalid or unenforceable for any reason, the invalidity or unenforceabihty of such section, paragraph
or provision shall not affect any of the remaining provisions of this resolution
28. Headings. Headings in this resolution are included for convenience of reference only and
are not a part hereof, and shall not hnut or define the meaning of any provision hereof.
1899771v1
ADOPTED this 16th day of May, 2006.
ATTEST:
Amy Domeier, City Clerk
Motion by: Seconded by:
Voted m favor:
Voted Against:
1899771v1
Wi lham H Droste, Mayot
CERTIFICATE
STATE OF MINNESOTA
COUNTY OF DAKOTA ss
CITY OF ROSEMOUNT
I, Amy Domeier, 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 16th of May, 2006 and that the attached copy of the RESOLUTION
ACCEPTING OFFER ON THE SALE OF $4,405,000 GENERAL OBLIGATION
IMPROVEMENT BONDS, SERIES 2006B, PROVIDING FOR THEIR ISSUANCE AND
LEVYING A TAX FOR THE PAYMENT THEREOF 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
2006.
1899771v1
Amy Domeier, City Clerk
City of Rosemount
Dakota County, Minnesota
NEW ISSUES
OFFICIAL STATEMENT DATED MAY 2, 2006
Ratings: Requested from Moody's
Investors Service
In the opinion of Bnggs and Morgan, Professional Association, Bond Counsel, ased on present federal and Minnesota laws, regulations, rulings and decisions, at the time of
their issuance ano delivery to the onprral prchaser, interest on the Obi/cations is excluded from gross income for purposes of United States income tax and is excluded, to the
same extent, in computing both gross income and taxable net income for purposes cf Stale of Minnesota income tax !other than Minnesota trancrose taxes measured by income
and imposed on corporations and financial institutions), and is not an ,ten of tax preference for purposes of the federal alternative minimum tax imposed on individuals and
corporations or the Minnesota alternative minimum tax appicable to ind, vduals, estates or trusts, provided, however, that for the purpose of computing the federal alternative
minimum tax imposed on corporations, interest or the Obligations is taken into account in oetemmnina adjusted current carmngs No opinion with be expressed by Bond Counsel
regarding other federal or state tax consequences caused by the receipt or accrual of interest on tne Obligations or ansing with respect to ownership of tne Obligations See
'Tax Exemption" and "Other Federal and Sate Tax Consrderabons "herein
$370,000
General Obligation Equipment Certificates of
Indebtedness, Series 2006A
(the "Certificates
City of Rosemount, Minnesota
(collectively referred to as the "Obligations" or the "Issues
(Book Entry Only)
$4,405,000
General Obligation Improvement Bonds,
Series 2006A
(the "Bonds
Dated Date: June 1, 2006 Interest Due: Each February 1 and August 1
commencing February 1, 2007
The Certificates will mature February 1 as follows
2008 $70,000 2009 $70,000 2010 $75,000 2011 $75,000 2012 $80,000
The Bonds will mature February 1 as follows:
2008 $4407000 2010 $425;000 2u12 $4357000 2014 $445000 20 1b $455,000
2009 $425,000 2011 $430,000 2013 $440,000 2015 $450,000 2017 $460,000
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.
The City may elect on February 1. 2015, and on any day thereafter, to prepay the Bonds due on or after February 1, 2016.
All prepayments shall be at a price of par plus accrued interest. The Certificates will not be subject to redemption in
advance of their respective stated maturity dates
Common to Both Issues
The Obligations are general obligations of the City for which the City pledges its full faith and credit and power to levy direct
general ad valorem taxes Additional sources of security for the Obligations are discussed herein
A separate proposal must be submitted for each Issue, along with a certified or cashier's check or a Financial Surety Bond,
for not less than the amounts shown below Proposals shall specify rates in integral multiples of 5/100 or 1/8 of 1%
Rates must be in level or ascending oraer Award will be made on the basis of True interest Cost (TIC)
Minimum Bid Good Faith Deposit
The Certificates 364,080 3,700
The Bonds 4,369,760 44,050
The City will designate the Obligations as "qualified tax exempt obligations" pursuant to Section 265(b)(3) of the Internal
Revenue Code of 1986, as amended The Obligations will not be subject to the alternative minimum tax for individuals.
The Obligations will be issued as fully registered Obligations without coupons and, when issued, will be registered in the
name of Cede Co as nominee of The Depository Trust Company "DTC DTC will act as securities depository for the
Obligations. Individual purchases may be made in book -entry form only, in the principal amount of $5,000 and integral
multiples thereof Investors will not receive physical certificates representing their interest in the Obligations purchased.
(See "Book Entry System" herein.) U S Bank National Association, Saint Paul, Minnesota will serve as registrar (the
"Registrar) for the Ooligations. The Obligations will be available for delivery at DTC on or about June 15, 2006.
Springsted
PROPOSALS RECEIVED: May 16, 2006 (Tuesday) until 12:00 Noon, Central Time
AWARD: May 16, 2006 (Tuesday) at 7.30 P.M., Central Time
Further informabon may be obtained from SPRINGSTED
Incorporated, Financial Advisor to the Issuer, 380 Jackson Street,
Suite 300, Saint Paul, Minnesota 55101 -2887 (651) 223 -3000
For purposes of compliance with Rule 15c2 -12 of the Securities and Exchange Commission,
this document, as the same may be supplemented or corrected by the Issuer from time to time
(collectively, the "Official Statement may be treated as an Official Statement with respect to
the Obligations described herein that is deemed final as of the date hereof (or of any such
supplement or correction) by the Issuer, except for the omission of certain information referred
to in the succeeding paragraph.
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Obligations, together with any other
information required by law, shall constitute a "Final Official Statement" of the Issuer with
respect to the Obligations, as that term is defined in Rule 15c2 -12 Any such addendum shall,
on and after the date thereof, be fully incorporated herein and made a part hereof by reference.
By awarding the Obligations to any underwriter or underwriting syndicate submitting a Proposal
therefor, the Issuer 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 Obligations are awarded copies of the Official Statement and the addendum or addenda
described in the preceding paragraph in the amount specified in the Terms of Proposal
The Issuer designates the senior managing underwriter of the syndicate to which the
Obligations 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 Obligations agrees thereby that if its bid is accepted by the Issuer (i) it shall accept such
designation and (u) it shall enter into a contractual relationship with all Participating
Underwriters of the Obligations for purposes of assuring the receipt by each such Participating
Underwriter of the Final Official Statement
No dealer, broker, salesman or other person has been authorized by the Issuer to give any
information or to make any representations with respect to the Obligations, other than as
contained in the Official Statement or the Final Official Statement, and if given or made, such
other information or representations must not be relied upon as having been authorized by the
Issuer Certain information contained in the Official Statement and the Final Official Statement
may have been obtained from sources other than records of the Issuer and, while believed to
be reliable, is not guaranteed as to completeness or accuracy. THE INFORMATION AND
EXPRESSIONS OF OPINION IN THE OFFICIAL STATEMENT AND THE FINAL OFFICIAL
STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF THE
OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE
UNDER EITHER SUCH DOCUMENT SHALL CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE ISSUER SINCE THE DATE THEREOF
References herein to laws, rules, regulations, resolutions, agreements, reports and other
documents do not purport to be comprehensive or definitive All references to such documents
a re q in th e nt i ret y by reference to the particular document, the full text of which may
contain qualifications of and exceptions to statements made herein Where full texts of
documents prepared by or on behalf of the Issuer have not been included as appendices to the
Official Statement or the Final Official Statement, they will be furnished on request
Any CUSIP numbers for the Obligations included on the Addendum to the Official Statement
are provided for convenience of the owners and prospective investors. The CUSIP numbers for
the Obligations have been assigned by an organization unaffiliated with the Issuer The Issuer
is not responsible for the selection of the CUSIP numbers and makes no representation as to
the accuracy thereof as printed on the Obligations or as set forth on the Addendum to the
Official Statement. No assurance can be given that the CUSIP numbers for the Obligations will
1eindn11!iwsame after the date of issuance and of tile- Obtrgatiuiis.
TABLE OF CONTENTS
Pages?
Terms of Proposal:
$370,000 General Obligation Equipment Certificates of Indebtedness, Series 2006A i -iv
$4,405,000 General Obligation Improvement Bonds, Series 2006B v -viii
Introductory Statement 1
Continuing Disclosure 1
The Obligations 2
The Certificates 4
The Bonds 5
Future Financing 6
Litigation 6
Legality 6
Tax Exemption 6
Other Federal and State Tax Considerations 7
Bank Qualified Tax Exempt Obligations 8
Ratings 8
Financial Advisor 8
Certification. g
City Property Values 10
City Indebtedness 11
City Tax Rates, Levies and Collections 16
Funds on Hand 17
City Investments 17
General Information Concerning the City 18
Governmental Organization and Services 22
Proposed Forms of Legal Opinions Appendix I
Continuing Disclosure Undertaking Appendix 11
Summary of Tax Levies, Payment Provisions, and
Minnesota Real Property Valuation Appendix 111
Excerpt of 2004 Annual Financial Statements Appendix IV
Proposal Forms Inserted
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS:
TERMS OF PROPOSAL
$370,000
CITY OF ROSEMOUNT, MINNESOTA
GENERAL OBLIGATION EQUIPMENT CERTIFICATES OF INDEBTEDNESS, SERIES 2006A
(BOOK ENTRY ONLY)
Proposals for the Certificates will be received on Tuesday, May 16, 2006, 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 Certificates will be by the City Council at 7 30 P.M Central Time, of the same day
OR
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 Certificates 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 &d 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 bidder's 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 Certificates, 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
The Certificates will be dated June 1, 2006, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing February 1, 2007 Interest will
be computed on the basis of a 360 -day year of twelve 30 -day months.
The Certificates will mature February 1 in the years and amounts as follows:
2008 $70,000
2009 $70,000
DETAILS OF THE CERTIFICATES
2010 $75.000 2012 $80.000
2011 $75,000
BOOK ENTRY SYSTEM
The Certificates will be issued by means of a book entry system with no physical distribution of
Certificates made to the public The Certificates will be issued in fully registered form and one
Certificate, representing the aggregate principal amount of the Certificates 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
Certificates. Individual purchases of the Certificates 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 Certificates. 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 Certificates, will be required to deposit the Certificates 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 Certificates will not be subject to payment in advance of their respective stated matunty
dates.
SECURITY AND PURPOSE
The Certificates 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
finance the acquisition of various capital equipment for City purposes.
TYPE OF PROPOSALS
Proposals shall be for not less than $364,080 and accrued interest on the total principal amount
of the Certificates 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 $3,700,
payable to the order of the City If a check is used, it must accompany the proposal If a
Financial Surety Bond is used, rt 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
Spnngsted 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
C-et#tfie -aces are-awarded-to-an underwnterwsfng a Financial Surety then that purchaser is
required to submit its Deposit to Spnngsted Incorporated in the form of a certified or cashier's
check or wire transfer as instructed by Spnngsted Incorporated not later than 3 30 P.M Central
4
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 Certificates is adjourned, recessed, or continued
to another date without award of the Certificates 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. Certificates of the
same maturity shall bear a single rate from the date of the Certificates to the date of maturity.
No conditional proposals will be accepted.
AWARD
The Certificates 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 Certificates, (11) reject all proposals
without cause, and (iii) reject any proposal that the City determines to have failed to comply with
the terms herein.
CUSIP NUMBERS
If the Certificates qualify for assignment of CUSIP numbers such numbers will be printed on the
Certificates, but neither the failure to print such numbers on any Certificate nor any error with
respect thereto will constitute cause for failure or refusal by the purchaser to accept delivery of
the Certificates 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 Certificates 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 Certificates shall be made in
federal, or equivalent, funds that shall be received at the offices of the City or its designee not
later than 1200 Noon, Central Time. Unless compliance with the terms of payment for the
Certificates 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 Certificates, 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 Certificates, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Certificates, as that term is defined in Rule 15c2 -12. By awarding the Certificates 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 Certificates are awarded 25 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 Certificates 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 Certificates 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 Certificates
for purposes of assuring the receipt by each such Participating Underwriter of the Final Official
Statement.
Dated April 18, 2006 BY ORDER OF THE CITY COUNCIL
/s/ James D. Verbrugge
Deputy City Clerk
iv
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS:
TERMS OF PROPOSAL
$4,405,000
CITY OF ROSEMOUNT, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2006B
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, May 16, 2006, until 12:00 Noon, Central
Time, at the offices of Spnngsted Incorporated, 380 Jackson Street, Suite 300, Saint Paul,
Minnesota, after which time they will be opened and tabulated Consideration for award of the
Bonds Mill be by the City Council at 7 30 P.M Central Time, of the same day.
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 Spnngsted. 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.
OR
SUBMISSION OF PROPOSALS
(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 bidder's 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 sole 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
-v
DETAILS OF THE BONDS
The Bonds will be dated June 1, 2006, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing February 1, 2007. 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:
2008 $440,000
2009 $425,000
2010 $425,000
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.
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 secunties 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
2011 $430,000
2012 $435,000
2013 $440,000
BOOK ENTRY SYSTEM
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, 2015, and on any day thereafter, to prepay Bonds due on or
after February 1. 2016. 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
vi
2014 $445,000 2016 $455,000
2015 $450,000 2017 $460,000
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 special
aozcssments— against benefited properties. The -proceeds used to finance
improvement projects within the City
TYPE OF PROPOSALS
Proposals shall be for not less than $4,369,760 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 $44 050,
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 (ill) 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 th allure to print s 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
-vii
Bonds. The CUSP Service Bureau charge for the assignment of CUSIP identification numbers
shall be pad 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. 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 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
matunty dates, pnncipal 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 175 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 as 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 April 18, 2006 BY ORDER OF THE CITY COUNCIL
/s/ James D Verbrugge
Deputy City Clerk
-vui-
OFFICIAL STATEMENT
CITY OF ROSEMOUNT, MINNESOTA
$370,000
GENERAL OBLIGATION EQUIPMENT CERTIFICATES OF
INDEBTEDNESS, SERIES 2006A
$4,405,000
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2006B
(BOOK ENTRY ONLY)
INTRODUCTORY STATEMENT
This Official Statement contains certain information relating to the City of Rosemount,
Minnesota (the "City" or the "Issuer and its issuance of $370,000 General Obligation
Equipment Certificates of Indebtedness, Series 2006A (the "Certificates and $4,405,000
General Obligation improvement Bonds, Series 2006B (the "Bonds collectively referred to as
the "Obligations" or the "Issues." The Obligations are general obligations of the City for which
the City pledges its full faith and credit and power to levy direct general ad valorem taxes. The
purpose and additional sources of security for the Issues are further described herein.
Inquiries may be directed to Mr. Jeffrey May, Finance Director, City of Rosemount,
2875 145th Street West, Rosemount, Minnesota 55068 -4997, or by telephoning
(651) 423 -4411. Inquiries may also be made to Springsted Incorporated, 380 Jackson Street,
Suite 300, St Paul, Minnesota 55101 -2887, or by telephoning (651) 223 -3000. If information
of a specific legal nature is desired, requests may be directed to Ms. Mary Dyrseth, Briggs and
Morgan, Professional Association, Bond Counsel, 2200 First National Bank Building, St. Paul,
Minnesota 55101, or by telephoning (651) 808 -6625.
CONTINUING DISCLOSURE
In order to assist the Underwriters in complying with SEC Rule 15c2 -12 (the "Rule"), pursuant to
the Award Resolutions for the Obligations, the City has entered into undertakings (collectively the
"Undertaking for the benefit of holders or beneficial owners of the Obligations to provide certain
financial information and operating data relating to the City to certain information repositories
annually, and to provide notices of the occurrence of certain events enumerated in the Rule to
certain information repositories or the Municipal Securities Rulemaking Board and to any state
information depository The specific nature of the Undertaking, as well as the information to be
contained in the annual report or the notices of material events. is set forth in the Undertaking in
substantially the form attached hereto as Appendix II, subject to such modifications thereof or
additions thereto as: (i) consistent with requirements under the Rule, (ii) required by the
purchaser(s) of the Obligations and (in) acceptable to the Mayor and Clerk of the City The City
has never faded to comply in all material respects with any previous undertakings under the Rule
to provide annual repork nr notices Of material events
1-
A failure by the City to comply with the Undertaking will not constitute an event of default on the
Obligations (although holders or other beneficial owners of the Obligations will have the sole
remedy of bringing an action for specific performance) Nevertheless, such a failure must be
reported in accordance with the Rule and must be considered by any broker, dealer or
municipal securities dealer before recommending the purchase cr sale of the Obligations in the
secondary market Consequently, such a failure may adversely affect the transferability and
liquidity of the Obligations and their market price.
General Description
THE OBLIGATIONS
The Obligations are dated as of June 1, 2006 and issued in book entry form. Interest on the
Obligations is payable February 1, 2007 and semiannually thereafter on August 1 and
February 1 Interest will be payable to the holder (initially Cede Co.) registered on the books
of the registrar (the "Registrar as of the fifteenth day of the calendar month next preceding
such interest payment date. Principal of and interest on the Obligations will be paid as
described in the section herein entitled "Book Entry System." Obligations will mature in the
amounts and on the dates shown on the cover of this Official Statement. U.S. Bank National
Association, Saint Paul, Minnesota will serve as Registrar for the Obligations. The City will pay
for registration services
Optional Redemption
The Certificates will not be subject to redemption in advance of their respective stated maturity
dates
The City may elect on February 1, 2015, and on any day thereafter, to prepay the Bonds due on
or after February 1, 2016 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.
Book Entry System
The Depository Trust Company "DTC New York, New York, will act as securities depository
for the Obligations The Obligations will be issued as fully registered securities registered in the
name of Cede Co (DTC's partnership nominee) or such other name as may be requested by
an authorized representative of DTC One fully registered certificate will be issued for each
maturity of each series of the Obligations, in the aggregate principal amount of such maturity,
and will be deposited with DTC.
DTC is a limited- purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member of the
Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform
Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A
uf the— Secunties Exchange Act uf 1934. DTC holds becunties Mut its participants "Dir
Participants deposit with DTC. DTC also facilitates the post -sale settlement among Direct
Participants of sales and other securities transactions in deposited securities through electronic
-2-
computenzed book -entry transfers and pledges between Direct Participants' accounts, thereby
eliminating the need for physical movement of securities certificates Direct Participants
"Direct Participants include securities brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations DTC is a wholly -owned subsidiary of The
Depository Trust and Clearing Corporation "DTCC DTTC, in turn, is owned by a number of
Direct Participants of DTC and members of the National Securities Clearing Corporation, Fixed
Income Clearing Corporation, and Emerging Markets Clearing Corporation (NSCC, FICC, and
EMCC, also subsidiaries of DTCC), as well as by the New York Stock Exchange, Inc., the
American Stock Exchange LLC, and the National Association of Securities Dealers, Inc
Access to the DTC system is also available to others such as securities brokers and dealers,
banks, trust companies and clearing corporations that clear through or maintain a custodial
relationship with a Direct Participant, either directly or indirectly "Indirect Participants The
Rules applicable to DTC and its Direct and Indirect Participants are on file with the Securities
and Exchange Commission. More information about DTC can be found at www dtcc corn and
www.dtc.orq.
Purchases of Obligations under the DTC system must be made by or through Direct
Participants, which will receive a credit for the Obligations on DTC's records The ownership
interest of each actual purchaser of each Obligation "Beneficial Owner is in turn to be
recorded on the Direct and Indirect Participants' records Beneficial Owners will not receive
written confirmation from DTC of their purchase, but Beneficial Owners are expected to receive
written confirmations providing details of the transaction, as well as periodic statements of their
holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into
the transaction. Transfers of ownership interests in the Obligations are to be accomplished by
entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial
Owners Beneficial Owners will not receive certificates representing their ownership interests in
the Obligations, except in the event that use of the book -entry system for the Obligations is
discontinued.
To facilitate subsequent transfers, all Obligations deposited by Direct Participants with DTC are
registered in the name of DTC's partnership nominee, Cede Co. or such other name as
requested by an authorized representative of DTC. The deposit of Obligations with DTC and
their registration in the name of Cede Co. or such other DTC nominee do not effect any
change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the
Obligations, DTC's records reflect only the identity of the Direct Participants to whose accounts
such Obligations are credited, which may or may not be the Beneficial Owners The Direct and
Indirect Participants will remain responsible for keeping account of their holdings on behalf of
their customers
Conveyance of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Participants and indirect Participants to
Beneficial Owners will be governed by arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to time. Beneficial Owners of the
Obligations may wish to take certain steps to augment transmission to them of notices of
significant events with respect to the Obligations, such as redemptions, tenders, defaults, and
proposed amendments to the security documents. Beneficial Owners of the Obligations may
wish to ascertain that the nominee holding the Obligations for their benefit has agreed to obtain
and transmit notices to Beneficial Owners, or in the alternative, Beneficial Owners may wish to
provide their names and addresses to the Registrar and request that copies of the notices be
provided directly to them
Redemption notices shall be sent to DTC If less than all of the Obligations within a maturity
are being redeemed, DTC's practice is to determine by lot the amount of the interest of each
Urrect in such mmaturity to be
-3-
Neither DTC nor Cede Co. (nor such other DTC nominee) will consent or vote with respect to
the Obligations unless authorized by a Direct Participant in accordance with DTC's procedures
Under its usual procedures, DTC mails an Omnibus Proxy to the Issuer or Registrar as soon as
possible after the record date. The Omnibus Proxy assigns Cede Co 's consenting or voting
rights to those Direct Participants to whose accounts the Obligat*ons are credited on the record
date (identified in a listing attached to the Omnibus Proxy)
Principal and interest payments on the Obligations will be made to Cede Co. or such other
nominee as may be requested by an authorized representative of DTC. DTC's practice is to
credit Direct Participants' accounts, upon DTC's receipt of funds and corresponding detail
information from Issuer or Agent on the payable date in accordance with thew respective
holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be
governed by standing instructions and customary practices, as is the case with securities held
for the accounts of customers in bearer form or registered in "street name," and will be the
responsibility of such Participant and not of DTC (nor its nominee), the Registrar, or the Issuer,
subject to any statutory or regulatory requirements as may be in effect from time to time.
Payment of principal and interest to Cede Co (or such other nominee as may be requested
by an authorized representative of DTC) is the responsibility of the Registrar, Issuer, or Agent
disbursement of such payments to Direct Participants will be the responsibility of DTC, and
disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and
Indirect Participants.
A Beneficial Owner shall give notice to elect to have its Obligations purchased or redeemed,
through its Direct Participant, to the nominee holding the Obligations. and shall effect delivery of
such Obligations by causing the Direct Participant to transfer the Direct Participant's interest in
the Obligations, on DTC's records, to the nominee holding the Obligations. The requirement for
physical delivery of the Obligations in connection with a purchase or redemption will be deemed
satisfied when the ownership rights in the Obligations are transferred by the Direct Participants
on DTC's records and followed by a book -entry credit of purchased or redeemed Obligations to
the nominee holding the Obligations.
DTC may discontinue providing its services as securities depository with respect to the
Obligations at any time by giving reasonable notice to the Registrar. Under such
circumstances, in the event that a successor securities depository is not obtained, certificates
are required to be pnnted and denvered.
The Issuer may decide to discontinue use of the system of book -entry transfers through DTC
(or a successor securities depository) In that event, certificates will be printed and delivered
The information in this section concerning DTC and DTC's book -entry system has been
obtained from sources that the Issuer believes to be reliable, but the Issuer takes no
responsibility for the accuracy thereof
THE CERTIFICATES
Authority and Purpose
The Certificates are being issued pursuant to Minnesota Statutes, Section 412.301 and Chapter
475 Minnesota Statutes Section 412 301 specifies that the City may issue certificates of
indebtedness without exposure to a petition requirement calling for a referendum if the total
amount of the issue does not exceed 1 /4 of 1% of the market value of the taxable property in the
City. Based on the City's current market value, this represents an issue size of approximately
$477 9 This issuance of $370,00U is within that limitation and is not subject to petition
The proceeds will be used to finance the acquisition of various items of capital equipment for
City departments.
4
e.
The composition of the Certificates is as follows:
Project Costs $340,642
Costs of Issuance 14,350
Capitalized Interest 9,088
Allowance for Discount Bidding 5,920
Total Certificates $370,000
Security and Financing
The Certificates are general obligations of the City for which the City pledges its full faith and
credit and power to levy direct general ad valorem taxes. The City will make its first levy for the
Certificates in 2006 for collection in 2007. The February 1. 2007 interest payment will be made
with capitalized interest included in the principal amount of the Certificates. Thereafter, each
year's levy, if collected in full, will be sufficient to pay 105% of the interest due August 1 in the
year of collection and the principal and interest due February 1 in the following year.
THE BONDS
Authority and Purpose
The Bonds are being issued pursuant to Minnesota Statutes, Chapters 429 and 475. The
proceeds will be used to finance various improvements within the City, including street and
utility construction for the Old County Road 38 project
The composition of the Bonds is as follows:
Project Costs 9,700,665
Less Contribution from Other Sources (5,477,647)
Net Project Costs 4,223,018
Capitalized Interest 113,792
Allowance for Discount Bidding 35,240
Costs of Issuance 32,950
Total Bonds 4,405,000
Security and Financing
The Bonds are general obligations of the City for which the City pledges its full faith and credit
and power to levy direct general ad valorem taxes. In addition, the City pledges special
assessments against benefited properties. Special assessments in the principal amount of
$2,265,557 are expected to be filed in November 2006 over a term of ten years, with even
annual installments of principal, and interest charged on the unpaid balance at a rate of 1.5%
over the interest rate on the Bonds. The City will make its first levy for the Bonds in 2006 for
collection in 2007 Since the first interest payment comes due prior to collection of the
assessments and taxes, capitalized interest in the approximate amount of $113,792 has been
included in the principal amount of the Bonds to make that payment. Thereafter, each year's
special assessments and tax levies, if collected in full, will be sufficient to pay 105% of the
interest coming due August 1 in the year of collection and the principal and coming Cue
the following February 1 To the extent available, the City expects to use net revenues of the
water utility to reduce the levy requirements
-5-
FUTURE FINANCING
The City does not anticipate any additional borrowing for at least the next 90 days.
LITIGATION
The City is not aware of any threatened or pending litigation affecting the validity of the
Obligations or the ability to meet its financial obligations.
LEGALITY
The Obligations are subject to approval as to certain matters by Briggs and Morgan,
Professional Association, of Saint Paul and Minneapolis, Minnesota, as Bond Counsel. Bond
Counsel has not participated in the preparation of this Official Statement and will not pass upon
its accuracy, completeness, or sufficiency. Bond Counsel has not examined, nor attempted to
examine or verify, any of the financial or statistical statements or data contained in this Official
Statement and will express no opinion with respect thereto. Legal opinions in substantially the
form set out in Appendix I herein will be delivered at closing
TAX EXEMPTION
At closing Briggs and Morgan, Professional Association, Bond Counsel, will render an opinion
that, at the time of their issuance and delivery to the original purchaser, under present federal
and State of Minnesota laws, regulations, rulings and decisions (which excludes any pending
legislation which may have a retroactive effect), the interest on each Obligation is excluded
from gross income for purposes of United States income tax and is excluded to the same
extent, in computing both gross income and taxable net income for purposes of State of
Minnesota income tax (other than Minnesota franchise taxes measured by income and imposed
on corporations and financial institutions) and that interest on the Obligations is not an item of
tax preference for purposes of computing the federal alternative minimum tax imposed on
individuals and corporations or the Minnesota alternative minimum tax applicable to individuals,
estates or trusts, provided that interest on the Obligations is subject to federal income taxation
to the extent it is included as part of adjusted current earnings for purposes of computing the
alternative minimum tax imposed on certain corporations No opinion will be expressed by
Bond Counsel regarding other federal or state tax consequences caused by the receipt or
accrual of interest on the Obligations or arising with respect to ownership of the Obligations.
Preservation of the exclusion of interest on the Obligations from federal gross income and state
gross and taxable net income, however, depends upon compliance by the City with all
requirements of the Internal Revenue Code of 1986, as amended, (the "Code that must be
satisfied subsequent to the issuance of the Obligations in order that interest thereon be (or
continue to be) excluded from federal gross income and state gross and taxable net income
The City will covenant to comply with requirements necessary under the Code to establish and
maintain the Obligations as tax- exempt under Section 103 tereof, inclurtm linutaton,
requirements relating to temporary periods for investments and limitations on amounts invested
at a yield greater than the yield on the Obligations
-6-
Property and Casualty Insurance Companies
Property and casualty insurance companies are required to reduce the amount of their loss
reserve deduction by 15% of the amount of tax exempt interest received or accrued during the
taxable year on certain obligations acquired after August 7, 1986, including interest on the
Obligations.
Foreign Insurance Companies
Foreign companies carrying on an insurance business in the United States are subject to a tax
on income which is effectively connected with their conduct of any trade or business in the
United States, including "net investment income Net investment income includes tax exempt
interest such as interest on the Obligations.
Branch Profits Tax
A foreign corporation is subject to a branch profits tax equal to 30% of the "dividend equivalent
amount" for the taxable year. The "dividend equivalent amount" is the foreign corporation's
"effectively connected earnings and profits" adjusted for increase or decrease in "U S net
equity." A branch's earnings and profits may include tax exempt municipal bond interest, such
as interest on the Obligations.
Passive Investment Income of S Corporations
Passive investment income, including interest on the Obligations, may be subject to federal
income taxation under Section 1375 of the Code for an S corporation that has Subchapter C
earnings and profits at the close of the taxable year if more than 25% of the gross receipts of
such S corporation is passive investment income
Financial Institutions
OTHER FEDERAL AND STATE TAX CONSIDERATIONS
For federal income tax purposes, financial institutions are unable to deduct any portion of the
interest expense allocable to the ownership of certain tax exempt obligations acquired after
August 7 1986. including the Obligations but for the designation as qualified tax exempt
obligations. See "Bank Qualified Tax Exempt Obligations" below
State Tax Exemption
The 1995 Minnesota Legislature enacted a law that included interest on obligations of
Minnesota governmental units and Indian tribes in net income of individuals, estates and trusts
for Minnesota income tax purposes if a court determines that Minnesota's exemption of such
interest unlawfully discriminates against interstate commerce because interest on obligations of
governmental issuers located in other states is not excluded This law applies to taxable years
that begin during or after the calendar year in which any such court decision becomes final,
irrespective of the date on which the obligations were issued The Court of Appeals of
Kentucky recently held that Kentucky's exemption of interest on its own bonds, but not of
1nteresl-on-the bonds -of other states, unlawfully diculminates-against-interstate -commerce If-a
Minnesota Court were to render a similar final decision, interest on the Obligations would
become taxable for calendar years dunng and after the date the decision became final.
-7-
General
The preceding is not a comprehensive list of all federal tax consequences which may arise from
the receipt or accrual of interest on the Obligations The receipt or accrual of interest on the
Obligations may otherwise affect the federal income tax (or Minnesota income tax or franchise
tax) liability of the recipient based on the particular taxes to which the recipient is subject and
the particular tax status of other items of income or deductions. All prospective purchasers of
the Obligations are advised to consult their own tax advisors as to the tax consequences of, or
tax considerations for, purchasing or holding the Obligations.
BANK QUALIFIED TAX- EXEMPT OBLIGATIONS
The City will designate the Obligations as "qualified tax exempt obligations" for purposes of
Section 265(b)(3) of the Internal Revenue Code of 1986, as amended, relating to the ability of
financial institutions to deduct from income for federal income tax purposes, interest expense
that is allocable to carrying and acquiring tax exempt obligations "Qualified tax exempt
obligations" are treated as acquired by a financial Institution before August 8, 1986. interest
allocable to such obligations remains subject to the 20% disallowance under prior law
RATINGS
Applications for ratings of the Obligations have been made to Moody's Investors Service
"Moody's 99 Church Street, New York, New York. If ratings are assigned, they will reflect
only the opinion of Moody's Any explanation of the significance of the ratings may be obtained
only from Moody's.
There is no assurance that ratings, if assigned, will continue for any given period of time, or that such
ratings will not be revised or withdrawn, if in the judgment of Moody's, circumstances so warrant A
revision or withdrawal of the ratings may have an adverse effect on the market price of the
Obligations.
FINANCIAL ADVISOR
The City has retained Springsted Incorporated, Public Sector Advisors, of St. Paul, Minnesota,
as financial advisor (the "Financial Advisor in connection with the issuance of the Obligations.
In preparing the Official Statement, the Financial Advisor has relied upon governmental
officials, and other sources, who have access to relevant data to provide accurate information
for the Official Statement, and the Financial Advisor has not been engaged, nor has it
undertaken, to independently verify the accuracy of such information The Financial Advisor is
not a public accounting firm and has not been engaged by the City to compile, review, examine
or audit any information in the Official Statement in accordance with accounting standards The
Financial Advisor is an independent advisory firm and is not engaged in the business of
underwriting, trading or distributing municipal securities or other public securities and therefore
will not participate in the underwriting of the Obligations.
-8-
CERTIFICATION
The City has authorized the distribution of this Official Statement for use in connection with the
initial sale of the Obligations. As of the date of the settlement of the Obligations the
Purchaser(s) will be furnished with a certificate signed by the appropriate officers of the City.
The certificate will state that as of the date of the Official Statement, the Official Statement did
not and does not as of the date of the certificate contain any untrue statement of material fact
or omit to state a material fact necessary in order to make the statements made therein, in light
of the circumstances under which they were made, not misleading.
(The Balance of This Page Has Been Intentionally Left Blank)
-9-
2005 Indicated Market Value of Taxable Property: $2,196,722,769
The indicated market value is calculated by dividing the City's 2005 taxable market value of
$1,919.935,700 by the 2004 sales ratio of 87.4% for the City as provided by the State Department of
Revenue (2005 sales ratios are not yet available.)
2005 Taxable Net Tax Capacity: $21,355,409
2005 Net Tax Capacity
Less Captured Tax Increment Tax Capacity
Contribution to Fiscal Disparities
Plus: Distribution from Fiscal Disparities
2005 Taxable Net Tax Capacity
2005 Taxable Net Tax Capacity by Class of Property
Residential Homestead $16,343,697 76.5%
Commercial /Industrial, Public
Utility and Railroad 3,931,453 18 4
Agricultural 335,071 1 6
Apartments 278,731 1.3
Personal Property 466,457 2.2
Total $21,355,769 100 0%
Reflects adjustments for fiscal disparities and captured tax increment tax capacity.
Trend of Values
CITY PROPERTY VALUES
$21,604,139
(350,018)
(1,571,759)
1,673,047
$21,355,409
Indicated Taxable Taxable Tax
Market Value(a) Market Value Capacity(b)
2005 $2,196,722,769 $1,919,935,700 $21,355,769
2004 1,838,234,211 1,606,616,700 18,028,538
2003 1, 588, 774,651 1,366, 346,200 15.373, 855
2002 1, 353, 935,798 1,153,553,300 13,132,139
2001 1,122,690,460 976,740,700 11,262,405
(a) Calculated by dividing the taxable market value by the sales ratio determined for the City each year by
the State Department of Revenue
(b) See Appendix 111 for an explanation of tax capacity and Minnesota property tax laws
10
Ten of the Largest Taxpayers in the City
Taxpayer Type of Business
Flint Hills Resources /Koch Refining
Xcel Energy
Clare) Corporation
Webb Properties
Bigos Rosemount LLC
(Cannon Equipment)
CF Industries, Inc (Cenex)
Limerick Way LLC
Continental Nitrogen
Resources Corp.
Hidden Valley SPE, LLC
Lundgren Bros Construction Inc.
Total
Represents 14.2% of the City's 2005 taxable net tax capacity.
Legal Debt Limit
Debt Limit (2% of Taxable Market Value)
Less Outstanding Debt Subject to Limit
Legal Debt Margin at March 31, 2006
General Obligation Debt Supported by Taxes*
Date
of Issue
12 -1 -01
6 -15 -05
6 -15 -05
11 -1 -05
6 -1 -06
Total
Original
Amount
725,000
2,630,000
1,535,000
1,115,000
370,000
Oil Refinery
Utility
Retail
Manufacturing
Manufacturing
Fertilizer
Townhouses
Fertilizer Blending Plant Food
Utility
Construction
CITY INDEBTEDNESS
Purpose
Community Center Refunding
Fire Station
Equipment
Fire Station Refunding
Equipment (the Certificates)
These issues are subject to the statutory debt limit.
$38,398,714
(6,180, 000)
$32,218,714
2005 Net
Tax Capacity
$1,993,576
292,021
194,366
89,864
86,770
81,510
78,752
78,718
71,937
56,298
$3,023,812
Principal
Final Outstanding
Maturity As of 3 -31 -06
2 -1 -2013 530,000
2 -1 -2025 2,630,000
6 -1 -2010 1,535,000
2 -1 -2016 1,115,000
2 -1 -2012 370,000
$6,180,000
General Obligation Debt Supported Primarily by Special Assessments
Date
of Issue
4 -1 -98
10 -1 -99
8 -15 -01
7 -1 -02
7 -1 -03
6 -1 -06
Total
General Obligation Port Authority Debt
Date
of Issue
4 -1 -98
8 -15 -01
7-1-02
Total
Original
Amount
$2,010,000
4,395,000
1,325,000
3,395,000
1,945 000
4,405,000
Original
Amount
$2,405,000
2,045,000
1,795,000
(a) Debt service payments on
fund levies
(b) This issue is being repaid
(c) This issue is being repaid
utility revenues.
Date Original
of Issue Amount
7 -1 -96
10 -1 -99
9 -1 -00
8 -15 -01
12 -1 -01
7 -1 -02
7 -1 -03
11 -1 -05
$1,035,000
855,000
1,160,000
1,140,000
805,000
1,195,000
1,170,000
2,990,000
Purpose
Local Improvements
Local Improvements
Local Improvements
Local Improvements
Local Improvements
Local Improvements (the Bonds)
Purpose
Municipal Building Refunding
City Hall
Highway 3 Enhancement
General Obligation Debt Supported by Revenues
this issue are made from a combination of certain special tax and general
f rom ad valorem taxes levied by the City.
from a combination of tax levies, special assessments, and storm water
Purpose
Storm Water Revenue
Storm Water Revenue
Water Revenue
Storm Water Revenue
Storm Water Revenue Refunding
Water and Storm Water Revenue
Water Revenue
Water Revenue
Total $8,165,000
12
Final
Maturity
2 -1 -2009
2 -1 -2011
2 -1 -2012
2 -1 -2013
2 -1 -2014
2 -1 -2017
Final
Maturity
2 -1 -2018
2 -1 -2022
2 -1 -2013
Principal
Outstanding
As of 3 -31 -06
560,000
1,255,000
840,000
1,475,000
1,540.000
4,405 000
$10,075,000
Principal
Outstanding
As of 3 -31 -06
$2,010,000(
1,800,000(b)
1,175,000(C)
$4,985.000
Principal
Final Outstanding
Maturity As of 3 -31 -06
2 -1 -2012 505,000
2 -1 -2015 590,000
2 -1 -2016 885,000
2 -1 -2017 915,000
2 -1 -2008 285,000
2 -1 -2018 1,035,000
2 -1 -2014 960,000
2 -1 -2016 2,990,000
Annual Calendar Year Debt Service Including These Issues
Year Principal
2006 (at 3 -31)
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Total
290,000
545,000
645,000
670,000
690,000
375,000
390,000
320,000
245,000
255,000
265,000
140,000
145,000
150,000
155,000
165,000
170,000
180,000
190,000
195,000
G 0 Debt Supported
by Taxes
Principal
Interest(a)
411,511.89
755,485.84
834,625.00
838,211 25
835,530.00
501,878.75
502,427.50
418,865.00
331,075 00
331,502 50
331,452.50
198,515.00
197,815.00
196,915.00
195,815.00
199,332.50
197,465 00
200,267.50
202,470.00
199,192 50
$6,180,00(1
Principal
(Paid)
1,360,000
1,800,000
1,240,000
1,070,000
1,090,000
825,000
685,000
640,000
450,000
455,000
460,000
$7,880,352.73 $10,075,000(
(a) Includes the Certificates at an assumed average annual interest rate of 3 70
(b) Includes the Bonds at an assumed average annual interest rate of 3.95%
(c) 71 6% of this debt will be retired within ten years.
(d) 95.4% of this debt will be retired within ten years.
13
G.O. Debt Supported
Primarily by
Special Assessments
Principal
Interest(b)
108,788.75
1,752,200.41
2,105,757.50
1,487,615.00
1,271,775.00
1,248,695.00
946,380.00
778,313.75
708,545.00
497,315.00
483,761.25
469,660.00
$11,858,806.66
Annual Calendar Year Debt Service Including These Issues (continued)
G.O Debt Supported
G.O Port Authority Debt by Revenues
Pnncipal Principal
Year Principal Interest Principal Interest
2006 (at 3 -31) (Paid) 112,530 01 (Paid) 190 951.26
2007 435,000 651,748.77 820,000 1,133,578.76
2008 445,000 644,55817 875,000 1,156,813.76
2009 380,000 562,813 77 745,000 995,897 51
2010 395,000 561,521.27 780,000 1,001,196.26
2011 415,000 563,947 52 815,000 1,004,327.51
2012 435,000 565,053.14 845,000 1,000,527.51
2013 455,000 565,125 01 785,000 907,596 26
2014 260,000 353,698 13 815,000 905.496.26
2015 270,000 350,867 50 710,000 768,466.26
2016 285,000 352,230.00 660,000 688,811 26
2017 305,000 357,587 50 205,000 214,869 38
2018 315,000 352,113 75 110,000 112,530.00
2019 135.000 160.990 00
2020 145,000 164,125.00
2021 150,000 161,750.00
2022 160,000 164,000 00
Total
$4,985,000(a) $6,644,660 14 $8,165,000( $10,081,061.99
(a) 75.7% of this debt will be retired within ten years.
96.1 of this debt will be retired within ten years.
Lease Purchase Agreements
The City entered into a lease- purchase agreement dated May 15, 1996 for a fire truck. The
principal amount of the lease is $476,445 with annual payments of $64,896 The final payment
will be due June 1, 2006.
Summary of Direct Debt Including These Issues
G O. Debt Supported by Taxes 6,180,000 (168,537) $6,011,463
G O. Debt Supported by Special
Assessments 10,075,000 (3,287,784) 6,787,216
G 0 Port Authority Debt 4,985,000 (1,359,196) 3.625,804
G O Debt Supported by Revenues 8,165,000 (1,713,183) 6,451,817
Debt service funds are as of March 31, 2006 and include money to pay both principal and interest.
14
Gross
Debt
Less: Debt Net
Service Funds' Direct Debt
Indirect General Obligation Debt
Taxing Unit(a)
Dakota County
ISD 196 (Rosemount
Apple Valley- Eagan)
ISD 199 (Inver
Grove -Pine Bend)
ISD 200 (Hastings)
Metropolitan Council
Metropolitan Transit Dist.
Total
(a)
(b)
(c)
(d)
(e)
2005 Taxable
Net Tax Capacity
384,177,099
156,697,271
27,837,925
28,414,273
3,001,556,502
2,304,847,503(
Only those units with debt outstanding are shown here.
Excludes debt supported by revenues and tax and aid anticipation debt.
includes $15 540,000 of annual appropriation lease revenue debt
Does not include outstanding general obligation debt supported by sewer revenues, 911 user fees or
housing rental payments. Includes $13,530.000 of certificates of participation
Represents 2004 taxable net tax capacity. The 2005 value is not yet available.
Debt Ratios Including These Issues
G.O. Debt
As of 3 31 06(b)
93,410,000
149,421,949(
15
39,805,000
43,110,000
27,435,000(d)
147,435,000
G.O. Net
Direct Debt
Debt Applicable to
Tax Capacity in City
Percent Amount
5.6% 5,230,960
12 8 19,126,009
4.3 1,711,615
0.1 43,110
0.7 192,045
0.8 1,179,480
$27,483,219
G.O Indirect
Net Direct Debt
To 2005 Indicated Market Value ($2,196,722,769) 0 75% 2 00%
Per Capita (21,230 2006 City Estimate) $774 $2,068
Excludes general obligation debt supported by revenues and lease- purchase agreements.
Tax Capacity Rates
CITY TAX RATES, LEVIES AND COLLECTIONS
2005/06
For
2001/02 2002/03 2003/04 2004/05 Total Debt Only
Dakota County(a) 33.102% 32 463% 30.300% 28 267% 26.318% -0-
City of Rosemount(b) 59 546 57.123 52.368 46.041 43.755 8 618%
ISD 196(c) 28.883 27.638 26 074 26.251 27 554 14 204
Special Districts(d) 5.021 5.563 5.128 5 216 5 256 1 732
Total 126.552% 122.787% 113 870% 105.775% 102 883% 24.554%
(a) Dakota County also has a 2005/06 fax rate of 0 00592% spread on the market value of property in
support of debt service.
The City also has a 2005/06 tax rate of 0 00818% spread on the market value of property in .support of
debt service on general obligation fire station bonds.
Independent School District 196 (Rosemount -Apple Valley Eagan) also has a 2005/06 tax rate of
0.22437% spread on the market value of property in support of an excess operating levy and
buildings.
(d) Special distncts include Metropolitan Council, Regional Transit District, Mosquito Control, Dakota
County Community Development Authority, Dakota County Light Rail and Vermillion River Watershed
District.
(b)
(c)
NOTE: Taxes are determined by multiplying the net fax capacity by the tax capacity rate, expressed as
a percentage (see Appendix 111).
Tax Collections for the City
Net Collected During Collected
Amount Collection Year As of 3 -31 -06
Levy/Collect of Levy Amount Percent Amount Percent
2005/06 $8,766,232 (In Process of Collection)
2004/05 6,686,956 $6,617,997 99 0% $6,638,376 99 3%
2003/04 7,032,501 6,952.283 98.9 7,015,984 99 8
2002/03 6,469,801 6,384,169 98 7 6,460,167 99.9
2001/02 5,730,975 5,675,507 99 0 5,725,066 99.9
The net levy excludes state aid for property tax relief and fiscal disparities, if applicable The net levy
is the basis for computing fax capacity rates
16
Fund
FUNDS ON HAND
As of March 31, 2006
General
Special Revenue
Port Authority
Debt Service
Tax Supported
Assessment Supported
Port Authority Supported
General Obligation Revenue Supported
Construction
Water, Sewer and Storm Water
Arena
Total
CITY INVESTMENTS
City funds are invested in accordance with Minnesota Statutes, Section 118A and the City's
investment policy which is more restrictive than State statutes. The City investment portfolio is
managed in a manner to attain a market rate of return while preserving and protecting the capital
of the overall portfolio The Finance Director or the City Administrator is responsible for investing
all funds, including making investment decisions on a daily basis and monitoring the portfolio.
Pursuant to the City's investment policy the City is authorized to invest in the following
1. Governmental Securities: Instruments such as bonds, notes, bills, mortgages and other
securities which are direct obligations of the federal government or its agencies, with the
principal fully guaranteed by the U.S government or its agencies The City will not
invest in any mortgage or mortgage- related security unless a return of principal is
completely guaranteed by a federal entity.
2. Certificate of Deposit
3. Repurchase Agreement.
4. Reverse Repurchase Agreement.
5. Prime Commercial Paper
6 Any security which is a general obligation of the State of Minnesota or any of its
municipalities.
7 Bankers acceptances of United States banks eligible for purchase by the Federal
Reserve System.
Collateralization is required on two types of investments, certificates of deposit and repurchase
agreements In order to anticipate market changes and provide a level of security for all funds,
the collateralization level is 110 percent of the market value of principal and accrued interest.
The City attempts to diversify its investments according to type and maturity. The portfolio, as
much as possible, contains both short-term and long -term investments. The long -term portion
17
Cash and Investments
4,812,063
5,692,416
190,333
168,537
3,287,784
1,359,196
1,713,183
8,566,904
15,983,016
(25.002)
$41,748,430
of the portfolio, meaning longer than five years, may not exceed 35% of the total funds in the
portfolio. This is done to reduce overall market risk of rates changing.
As of March 31, 2006 the City had a total of $40,557,260 invested funds as follows
Type of Security
Money Market Savings
Certificates of Deposit
Certificates of Deposit
Certificates of Deposit
Government Asset Backed Securities
Government Asset Backed Securities
Length of Investment
N/A
Less than 12 months
One to ten years
Over ten years
Ten years or less
Over ten years
Total $40,557,260
GENERAL INFORMATION CONCERNING THE CITY
Amount Invested
as of 3 -31 -06
512,897
25,606,938
2,022,000
192,000
11,159, 555
1,063,870
The City of Rosemount, located in northern Dakota County, is a southem suburb of the
Minneapolis /Saint Paul metropolitan area. The City encompasses an area of 22,560 acres and
had a 2000 U.S. Census count of 14,619, a 69 6% increase from the City's 1990 Census count
of 8,622 The City estimates its 2006 population to be 21,230, a 45% increase over the 2000
U.S. Census
A major contributor to the City's tax base and economy is an industrial complex sited on 6,200
acres in the northeastern portion of the City near the Mississippi River Firms located there
include Flint Hills Resources /Koch Petroleum Group, CF Industries, Continental Nitrogen,
Endres Processing, SKB (industrial waste containment facility) and Spectro Alloys Mid
American Pipeline Company transports gas from southern states and operates a bottling station
at Pine Bend Minnesota Pipeline Company transports Canadian and North Dakota crude oil to
the Flint Hills refinery at Pine Bend
Flint Hills is a leading producer of petroleum products in Minnesota converting 290,000 barrels
of crude oil into gasoline each day. This Rosemount company employs 800 full -time workers
The University of Minnesota's Rosemount Research Center is located on a 7,500 acre tract of
land of which approximately 3,200 acres are situated in the City. This facility is utilized by the
University, other research agencies, and private firms for agricultural and other research
projects
18
Major Employers
Employer
Independent School District 196
Flint Hills Resources
Intermediate School District 917
Dakota County Technical College
Cannon Equipment Company
Spectro Alloys Corp.
Greif Brothers Corporation
Endres Processing Ltd
City of Rosemount
Dakota County HRA
Astro Plastics (Reese Enterprises, Inc.)
Aquila, Inc
Continental Nitrogen Resources Corp.
CF Industries, Inc. (Cenex)
Rayfo Inc.
Labor Force Data
Dakota County
Minneapolis /St. Paul MSA
Minnesota
Building Permits Issued by the City
Total Permits
Number Value
2006 (to 3 -31)
2005
2004
2003
2002
2001
2000
1999
1998
1997
153
1,293
1,158
1,128
1,398
1,009
862
1,021
739
601
231,322
1,845,516
2,931,721
Product/Service
Education
Crude Oil
Education
Education
Manufacturing of Metal Parts
Aluminum Alloys
Multiwall Bags
Livestock Feed
Government
Government
Plastics Manufacturing
Natural Gas
Chemicals
Warehousing /Freight Terminal
Industrial Refuse Containers
(a) Represents total employment, not just within the City of Rosemount.
(b) Excludes over 160 part -time and seasonal employees.
Source: Telephone survey of individual employers, Apnl 2006.
March 2006
Civilian Unemployment
Labor Force Rate
4.0%
43
4.8
20,114,976
123,374,042
126,348,047
96,872,709
82,398,820
82,897,167
52,125,217
50,950,727
31,939,355
24,173,652
19
Approximate
Number
of Employees
4,OOOWa)
800
300
250
160
142
92
75
74(
60
53
46
39
38
35
March 2005
Civilian Unemployment
Labor Force Rate
230,393
1,837,909
2,926,796
Source Minnesota Department of Employment and Economic Development. 2005 data are preliminary.
New Single
Number
46
454
551
440
330
304
285
357
190
99
4.1%
4.4
5.0
Family Homes
Value
10,565,461
88,551,982
110,674,682
87,119,479
61,571,739
60,458,504
39,074,424
40,780,200
21,856,164
10,942,651
Recent and Proposed Development
Residential activity in the City slowed somewhat in 2005, with a 17.5% decrease over the prior
record year in permits issued for new dwelling units Of the 454 permits issued, 42% of the
new construction was for single family detached housing. Planning approvals by the City have
created an inventory of and that is expected to generate more than 400 housing starts annually
for the next few years
From 2001 through 2005, an average of almost $82 million in new construction value was
added per year During this same period, the City added over 2,079 single family homes to its
housing stock (an average of 416 homes per year)
Some of the larger housing projects currently being developed or recently completed are as
follows.
Development/Developer
Biscayne Pointe 4 Addition /Heritage
Development
Biscayne Pointe North /Giles Property
Carrousel Plaza Townhomes /Heritage
Development
Connemara Crossing/
Basic Builders, Inc.
Evermoor 3 Addition /CPDC
Evermoor 4 Addition/
CPDC
Evermoor Bards Crossing /CPDC
Evermoor Crosscroft/CPDC
Evermoor Crosscroft 2 Addition /CPDC
Evermoor Drumcliffe /CPDC
Evermoor Glendalough /Lundgren
Evermoor Glendalough 5 Addition/
Lundgren Brothers
Evermoor Glendalough 6 Addition/
Lundgren Brothers
Geronime Pond 2 Addition/
Heritage Development
GlenRose of Rosemount/
Dean Johnson Homes
Harmony /CPDC
Harmony 2nd Addition /CPDC
Harmony 3 Addition /CPDC
Meadows of Bloomfield /Centex Homes
Meadows of Bloomfield 3` Addition/
Centex Homes
Rosewood Estates /Progress Land
Rosewood Village /Progress Land
Rosewood Village 2 Addition/
Progress Land Co
Housing
Single Family
Single Family
Townhomes
Single Family
Single Family
Single Family
Multi Family
Single Family
Single Family
Single Family
Single Family
Single Family
Single Family
Single Family
Multi Family
Multi- Family
Multi Family
Single Family
Single Family/Townhomes
Single Family
Single Family
Single FamilylTownhomes
20
Units
Approved
Remaining
lots as of
2 -28 -06
73 3
22 3
38 5
44 28
30 10
97 9
110 55
18 4
23 8
47 1
46 4
35 18
42 42
52 4
76 76
176 94
81 77
17 16
236 43
118 73
55 1
43 9
Single Family/Townhomes 56 47
he-City Counc approved -a rcvitalization-plan-for thetstonc- downtown 2nd selected fait
development team in 2004 A tax increment financing district was created in 2004 to permit
alternative financing sources for portions of the redevelopment process, if needed. The first
project construction is expected to begin in 2007. Also planned for the district is a residential
development (Harmony Addition) including 600 single family and multi family units on the
redeveloped site of the Brockway glass factory, which closed in the mid -1980s As of March
2006, 87 multi- tenant units and seven single- family units have been completed in the Harmony
development
The City owns land purchased from the Church of St. Joseph at the edge of downtown to serve
as a site branch of the Dakota County Library system. Construction and operation of the library
will be funded by the County under terms of a joint powers agreement now being negotiated
with the City.
In 2005, construction was completed on a 48,000 square -foot retail development The retail
center includes a 15,000 square -foot grocery store A 6,400 square -foot restaurant opened in
March of 2006 A 7,920 square foot multi- tenant center was also constructed in 2005 and has
been partially leased out as of the end of March 2006
Industrial valuations increased by $9 million in 2005, primarily due to upgrades to the Flint Hills
refinery The new construction will meet recent air emission standards and increase production
at the plant School District 196 and the Dakota County Technical College both implemented
large capital improvement projects within their buildings Expansions occurred to the
elementary middle, and high schools for a construction value of over $13 million dollars
Financial Institutions
Full service banking is provided by the First State Bank of Rosemount and Rosemount National
Bank, located in the City As of December 31, 2005, the two banks reported deposits of
$54,810,000 and $48,529,000, respectively Branches of TCF Bank and Vermillion State Bank
are also located in the City.
Source: Federal Deposit Insurance Corporation website.
Education
The major portion of the City is part of Independent School District 196, headquartered in
Rosemount. The District's enrollment for the 2005/06 school year is approximately 27,856
students in grades kindergarten through twelve The Distnct is one of the fastest growing school
distncts in the State, and one of the largest employers in the City with approximately 4,000
full -time and part-time employees District -wide The physical plant of the Distnct consists of 18
elementary schools, six middle schools, and four senior high schools Of these schools, two
elementary schools, one junior high, and one senior high are located in the City of Rosemount
Small portions of the City are located in Independent School District 199 (Inver Grove -Pine
Bend) and Independent School District 200 (Hastings)
The Dakota County Technical College is also located in the City The Technical College,
located on a 96 -acre site, opened in 1973. The Technical College has an enrollment of
approximately 2,000 post- secondary students. In addition, the Technical College offers an
extensive adult education program
21
GOVERNMENTAL ORGANIZATION AND SERVICES
Organization
Rosemount was established as a municipal corporation in 1858, and became a statutory City in
1974 The City has a Mayor Council form of government, with the four Council members being
elected to overlapping four -year terms of office. The present City Council is fisted below.
Expiration of Term
William H. Droste Mayor December 31, 2006
Mark DeBettignies Council Member December 31, 2006
Kimberly Shoe Corngan Council Member December 31, 2006
Michael Baxter Council Member December 31, 2008
Phillip Sterner Council Member December 31, 2008
The City's chief administrative officer is the City Administrator, who is appointed by and serves
at the discretion of the City Council. Mr James D. Verbrugge was appointed to the position of
City Administrator in March 2003 Prior to that, Mr. Verbrugge served as Assistant City
Administrator in Eagan, Minnesota since 1998. Mr. Jeffrey A May, who has served in the City's
Finance Department since 1985, was appointed as the City's Finance Director in March 1991
Growth and development of the City is guided by the Comprehensive Land Use Plan, most
recently adopted in 2000, covering development expectations until the year 2020 The
Comprehensive Plan outlines the long -range land use plan and development policies of the
community, and is designed to encourage and promote orderly development and growth,
perpetuating a sound and steady growth in the City tax base. In 2005, the City Council adopted
a Comprehensive Plan Amendment that will bring more than 2,000 acres into the City's
Municipal Urban Service Area. Additionally, projected land uses were changed in the County
Road 42 /State Highway 52 interchange area to take advantage of the future upgrades to the
road system The City has begun to investigate changes to the 2020 Comprehensive Plan to
meet the State required update due in 2008, which will utilize development projections to the
year 2030
Services
Police protection for the City is provided by 20 full -time officers, and four other police personnel.
Fire protection is provided by 37 trained volunteers The City has a class 5 insurance rating
The City completed an expansion of its public works facility in 1999. The expansion was funded
by a 20 -year internally funded lease- purchase agreement, effective January 20, 1999, in the
amount of $548,000.
Municipal water, sanitary sewer and storm water services are provided to virtually all of the
developed areas of the City. The municipal water service is provided by six wells with three water
towers having a total storage capacity of 2,000,000 gallons The maximum pumping capacity is
6,000 000 gallons per day with an average demand of 2,007,841 gallons pumped daily
It is the City's policy to finance all of its lateral sanitary sewer and water improvements by
special assessments filed against benefited property, however, there is a provision for deferred
assessments, in which case it may be necessary to provide some tax support Core facilities
are intended to be financed from water and sewer connection charges, but these too may
require some tax support in the event sufficient connections do not occur in a timely manner.
To date, tax support has not been necessary.
1 he City finances the construction and long -term maintenance of its storm water core tacilities
through the operation of a storm water utility Each property in the City pays a quarterly
"stormwater user fee" and an initial connection charge to support the program.
22
Interceptor sewer lines and wastewater treatment plants in the seven county metropolitan area,
of which the City is a part, are under the jurisdiction of the Metropolitan Council Environmental
Services "MCES MCES finances its operations through user charges based on usage The
City is responsible for the construction and maintenance of sewer laterals
Employee Pensions
All full -time and certain part-time employees of the City of Rosemount are covered by defined
benefit pension plans administered by the Public Employees Retirement Association of
Minnesota (PERA) PERA administers the Public Employees Retirement Fund (PERF) and the
Public Employees Police and Fire Fund (PEPFF) which are cost sharing multiple- employer
public employees retirement plans. PERF members belong to either the Coordinated Plan or
the Basic Plan. Coordinated members are covered by Social Security and Basic members are
not All employees of the City covered by PERF belong to the Coordinated Plan All police
officers, fire fighters and peace officers who qualify for membership by statute are covered by
the PEPFF For the year ended December 31, 2005, the City's contribution to PERA was
$308,929 (unaudited)
Current General Fund Budget
ongoing operations.
2005 2006
Adopted Budget Adopted Budget
General Fund Revenues:
General Property Taxes $5,083,300 $5,489,200
Intergovernmental 484,000 525,000
Licenses and Permits 750,200 859,700
Fines and Forfeits 90,000 90,000
Charges for Services 1,229,900 1,160,700
Miscellaneous Revenues 253,700 266,700
Investment Income 101,500 121.500
Transfers In 3,500 3.500
Total General Fund Revenues $7,996,100 $8,516,300
General Fund Expenditures:
General Government $2,161,700 $2,279,000
1 Public Safety 2,430,500 2,623,100
Public Works 2,389,200 2,555,000
Parks and Recreation 1,014700 1,059.200
Total General Fund Expenditures $7,996,100 $8,516,300
Action taken by the 2003 Minnesota Legislature provided for total reductions in City Aid
(formerly titled Local Government Aid and Market Value Homestead Credit) of $142,000,000 in
collection year 2003 and $170,000,000 in collection year 2004 The effect of these changes to
the City of Rosemount was a reduction in aid of approximately $752,472 in each 2003 and
2004. Minnesota law allowed the City to levy for 60% of the lost aid during the levy cycle
payable in 2004
For 2005, the Market Value Homestead Credit (MVHC) was supposed to be put back in place.
This did not happen as the Legislature cut the MVHC again for payable 2005 and 2006 For the
City, the reduction will be approximately $350.000 annually. The level of aid reductions does
not pose a significant problem -ta- the -City and -in_the opinion of management will not affect
23
BRI GGS AND MORGAN
PROFESSIONAL ASSOCIATION
PROPOSED FORMS OF LEGAL OPINIONS
$370,000
GENERAL OBLIGATION EQUIPMENT CERTIFICATES OF INDEBTEDNESS,
SERIES 2006A
CITY OF ROSEMOUNT
DAKOTA COUNTY
MINNESOTA
We have acted as bond counsel in connection with the issuance by the City of
Rosemount, Dakota County, Minnesota (the "Issuer of its $370,000 General Obligation
Equipment Certificates of Indebtedness, Series 2006A, beanng a date of original issue of June 1,
2006 (the "Certificates We have examined the law and such certified proceedings and other
documents as we deem necessary to render this opinion.
We have not been engaged or undertaken to review the accuracy, completeness or
sufficiency of the Official Statement or other offering material relating to the Certificates, and we
express no opinion relating thereto.
As to questions of fact material to our opinion, we have relied upon the certified
proceedings and other certifications of public officials furnished to us without undertaking to
venfy the same by independent investigation
Based upon such examinations, and assuming the authenticity of all documents submitted
to us as onginals, the conformity to original documents of all documents submitted to us as
certified or photostatic copies and the authenticity of the originals of such documents, and the
accuracy of the statements of act contained m such documents, and based upon present
Minnesota and federal laws (which excludes any pending legislation which may have a
retroactive effect on or before the date hereof), regulations, rulings and decisions, it is our
opinion that
(1) The proceedings show lawful authority for the issuance of the Certificates
according to their terms under the Constitution and laws of the State of Minnesota now in force.
(2) The Certificates are valid and binding general obligations of the Issuer and all of
the taxtblpropertv within the Issuer's jurisdiction is subject to the levy of an ad valorem tax to
pay the same without limitation as to rate or amount; provided that the enforceability (but not the
validity) of the Certificates and the pledge of taxes for the payment of the pnncipal and interest
I -1
APPENDIX I
2200 FIRST NATIONAL BANK BUILDING
332 MINNESOTA STREET
SAINT PAUL, MINNESOTA 55101
TELEPHONE (651) 808 -6630
FACSNIILE (651) 838 -6450
W W W BRIGGS COM
thereon is subject to the exercise of judicial discretion in accordance with general pnnciples of
equity, to the constitutional powers of the United States of America and to bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting creditors' rights
heretofore or hereafter enacted.
(3) At the time of the issuance and delivery of the Certificates to the original
purchaser, the interest on the Certificates is excluded from gross income for United States
income tax purposes and is excluded, to the same extent, from both gross income and taxable net
income for State of Minnesota income tax purposes (other than Minnesota franchise taxes
measured by income and imposed on corporations and financial institutions), and is not an item
of tax preference for purposes of the federal alternative minimum tax imposed on individuals and
corporations or the Minnesota alternative minimum tax applicable to individuals, estates or
trusts; it should be noted, however, that for the purpose of computing the federal alternative
minimum tax imposed on corporations, such interest is taken into account in determining
adjusted current earnings. The oprmons set forth in the preceding sentence are subject to the
condition that the Issuer comply with all requirements of the Internal Revenue Code of 1986, as
amended, that must be satisfied subsequent to the issuance of the Certificates in order that
interest thereon be, or continue to be, excluded from gross income for federal income tax
purposes and from both gross income and taxable net income for State of Minnesota income tax
purposes. Failure to comply with certain of such requirements may cause the inclusion of
interest on the Certificates in gross income and taxable net income retroactive to the date of
issuance of the Certificates.
We express no opinion regarding other state or federal tax consequences caused by the
receipt or accrual of interest on the Certificates or ansmg with respect to ownership of the
Certificates.
Dated at Saint Paul, Minnesota, this day of June, 2006.
1 -2
BRIGGS AND MORGAN
Professional Association
BRI GGS AND M ORGAN
PROFESSIONAL ASSOCIATION
$4,405,000
GENERAL OBLIGATION IMPROVEMENT BONDS,
SERIES 2006B
CITY OF ROSEMOUNT
DAKOTA COUNTY
MINNESOTA
We have acted as bond counsel in connection with the issuance by the City of
Rosemount, Dakota County, Minnesota (the "Issuer of its $4,405,000 General Obligation
Improvement Bonds, Senes 2006B, bearing a date of onginal issue of June 1, 2006 (the
"Bonds We have examined the law and such certified proceedings and other documents as we
deem necessary to render this opinion.
We have not been engaged or undertaken to review the accuracy, completeness or
sufficiency of the Official Statement or other offenng matenal relating to the Bonds, and we
express no opinion relating thereto.
As to questions of fact material to our opinion, we have relied upon the certified
proceedings and other certifications of public officials famished to us without undertaking to
verify the same by independent investigation.
Based upon such examinations, and assuming the authenticity of all documents submitted
to us as onginals, the conformity to original documents of all documents submitted to us as
certified or photostatic copies and the authenticity of the onginals of such documents, and the
accuracy of the statements of fact contained in such documents, and based upon present
Minnesota and federal laws (which excludes any pending legislation which may have a
retroactive effect on or before the date hereof), regulations, rulings and decisions, it is our
opinion that:
(1) The proceedings show lawful authority for the issuance of the Bonds according to
their terms under the Constitution and laws of the State of Minnesota now in force.
(2) The Bonds are valid and binding general obligations of the Issuer and all of the
taxable property within the Issuer's junsdiction is subject to the levy of an ad valorem tax to pay
the same without limitation as to rate or amount; provided that the enforceability (but not the
idity) of- the—Bends -and the P ledge -of taxes forthe_paymPnt oftheprinc pal and interest
thereon is subject to the exercise of judicial discretion in accordance with general pnnciples of
1 -3
2200 FIRST NATIONAL BANK BUILDENG
332 MINNESOTA STREET
SAINT PAUL, MINNESOTA 55101
TET FPHONE (651) 808 -6600
FACSIMILE (651) 808 -6450
IXnXWBRIGGS C M
equity, to the constitutional powers of the United States of America and to bankruptcy,
insolvency, reorganization, moratonum and other similar laws affecting creditors' rights
heretofore or hereafter enacted.
(3) At the time of the issuance and delivery of the Bonds to the original purchaser, the
interest on the Bonds is excluded from gross income for United States income tax purposes and
is excluded, to the same extent, from both gross income and taxable net income for State of
Minnesota income tax purposes (other than Minnesota franchise taxes measured by income and
imposed on corporations and financial institutions), and is not an item of tax preference for
purposes of the federal alternative minimum tax imposed on individuals and corporations or the
Minnesota altemative minimum tax applicable to individuals, estates or trusts; it should be noted,
however, that for the purpose of computing the federal alternative minimum tax imposed on
corporations, such interest is taken into account in determining adjusted current earnings. The
opinions set forth in the preceding sentence are subject to the condition that the Issuer comply
with all requirements of the Internal Revenue Code of 1986, as amended, that must be satisfied
subsequent to the issuance of the Bonds in order that interest thereon be, or continue to be,
excluded from gross income for federal income tax purposes and from both gross income and
taxable net income for State of Minnesota income tax purposes. Failure to comply with certain
of such requirements may cause the inclusion of interest on the Bonds in gross income and
taxable net income retroactive to the date of issuance of the Bonds
We express no opinion regarding other state or federal tax consequences caused by the
receipt or accrual of interest on the Bonds or ansing with respect to ownership of the Bonds.
Dated at Saint Paul, Minnesota, this day of June, 2006.
1
BRIGGS AND MORGAN
Professional Association
CONTINUING DISCLOSURE UNDERTAKING
APPENDIX II
This Continuing Disclosure Undertaking (the "Disclosure Undertaking is executed and
delivered by the City of Rosemount, Minnesota (the "Issuer in connection with the issuance of
$370,000 General Obligation Equipment Certificates of Indebtedness, Series 2006A (the
"Certificates The Certificates are being issued pursuant to a Resolution adopted May 16, 2006
(the "Resolution Pursuant to the Resolution and this Undertaking, the Issuer covenants and
agrees as follows:
SECTION 1. Purpose of the Disclosure Undertaking This Disclosure Undertaking is
being executed and delivered by the Issuer for the benefit of the Owners and in order to assist the
Participating Underwriters in complying with SEC Rule 15c2 12(b)(5).
SECTION 2. Definitions. In addition to the definitions set forth in the Resolution,
which apply to any capitalized term used in this Disclosure Undertaking unless otherwise defined
in this Section, the following capitalized terms shall have the following meanings:
"Annual Report" shall mean any annual financial information provided by the Issuer
pursuant to, and as descnbed in, Sections 3 and 4 of this Disclosure Undertaking
"Audited Financial Statements" shall mean the financial statements of the Issuer audited
annually by an independent certified public accounting firm, prepared pursuant to generally
accepted accounting principles promulgated by the Financial Accounting Standards Board,
modified by govemmental accounting standards promulgated by the Government Accounting
Standards Board.
"Dissemination Agent" shall mean such party from time to time designated in writing by
the Issuer to act as information dissemination agent and which has filed with the Issuer a written
acceptance of such designation.
"Fiscal Year" shall be the fiscal year of the Issuer.
"Governing Body" shall, with respect to the Certificates, have the meamng given that
term in Minnesota Statutes, Section 475.51, Subdivision 9
"MSRB" shall mean the Municipal Securities Rulemalung Board.
"National Repository" shall mean any Nationally Recognized Municipal Securities
Information Repository for purposes of the Rule. The National Repositories as of the date of
execution of this Undertaking are as listed on Exhibit A.
"Occurrence(s)" shall mean any of the events listed in Section S.A. of this Disclosure
Undertaking.
"Official Statement" shall be the Official Statement dated 2006,
prepared in connection with the Certificates.
"Owners" shall mean the registered holders and, if not the same, the beneficial owners of
any Certificates.
"Participating Underwriter" shall mean any of the original underwriters of the Certificates
required to comply with the Rule in connection with offenng of the Certificates.
"Repository" shall mean each National Repository and each State Depository
"Resolution" shall mean the resolution or resolutions adopted by the Governing Body of
the Issuer providing for, and authorizing the issuance of, the Certificates.
"Rule" shall mean Rule 15e2 12(b)(5) adopted by the Secunties and Exchange
Commission under the Secunties Exchange Act of 1934, as the same may be amended from time
to time or interpreted by the Securities and Exchange Commission.
"State" shall mean the State of Minnesota.
"State Depository" shall mean any public or private repository or entity designated by the
State as a state depository for the purpose of the Rule. As of the date of this Disclosure
Undertakmg, there is no State Depository in Minnesota.
SECTION 3. Provision of Annual Reports.
A. Beginning in connection with the Fiscal Year ending on December 31,
2005, the Issuer shall, or shall cause the Dissemination Agent to, as soon as available, but in any
event not later than December 31, 2006, and by December 31 of each year thereafter, provide to
each Repository an Annual Report which is consistent with the requirements of Section 4 of tlus
Disclosure Undertaking.
B. If the Issuer is unable to provide to the Repositones an Annual Report by
the date required in subsection A, the Issuer shall send a notice of such delay and estimated date
of delivery to each Repository or to the MSRB and to the State Depository, if any
C. Any filing under this Disclosure Undertaking may be made solely by
transmitting such filing to the Texas Municipal Advisory Council (the "MAC as provided at
http: /www.disclosureusa.org unless the Umted States Secunties and Exchange Commission has
withdrawn the interpretive advice in its letter to the MAC dated September 7, 2004.
SECTION 4. Content and Format of Annual Reports The Issuer's Annual Report shall
contain or incorporate by reference the financial information and operating data pertaining to the
Issuer Listed below as of the end of the preceding Fiscal Year. The Annual Report may be
submitted to each Repository as a single document or as separate documents compnsing a
package, and may cross reference other information as provided in this Disclosure Undertaking.
The following financial information and operating data shall be supplied:
A An update of the type of information contained in the Official Statement
under the caption VALUESTCITY1NDEBTEDNESS; and TAX
RATES, LEVI h S AND COLLECTIONS;
11 -2
B. Audited Financial Statements of the Issuer. The Audited Financial
Statements of the Issuer maybe submitted to each Repository separately from the balance of the
Annual Report. In the event Audited Financial Statements of the Issuer are not available on or
before the date for filing the Annual Report with the appropnate Repositones as set forth in
Section 3.A. above, unaudited financial statements shall be provided as part of the Annual
Report. The accounting principles pursuant to which the financial statements will be prepared
will be pursuant to generally accepted accounting pnnciples promulgated by the Financial
Accounting Standards Board, as such pnnciples are modified by the governmental accounting
standards promulgated by the Government Accounting Standards Board, as in effect from time to
time If Audited Financial Statements are not provided because they are not available on or
before the date for filing the Annual Report, the Issuer shall promptly provide them to the
Repositories when available.
SECTION 5. Reporting of Significant Events.
A. This Section 5 shall govem the giving of notices of the occurrence of any
of the following events with respect to the Certificates, if matenal
Dissemination Agent.
(1) principal and interest payment delinquency;
(2) non payment related defaults;
(3) unscheduled draws on debt service reserves reflecting financial
difficulties,
(4) unscheduled draws on credit enhancements reflecting financial difficulties;
(5) substitution of credit or liquidity providers, or their failure to perform;
(6) adverse tax opinions or events affecting the tax- exempt status of the
security;
(7) modifications to rights of secunty holders;
(8) Bond calls,
(9) defeasances;
(10) release, substitution or sale of property securing repayment of the
Certificates; and
(11) rating changes.
B. Whenever an event listed in Section 4.A. above has occurred, the Issuer
shall as soon as possible detennine if such event would constitute matenal infoiuiation for
holders of Certificates. If knowledge of the Occurrence would be matenal, the Issuer shall
promptly file a notice of such Occurrence with each National Repository or the MSRB and the
State Depository, if any.
SECTION 6. Termination of Reporting Obligation. The Issuer's obligations under this
Disclosure Undertaking shall terminate upon the legal defeasance, pnor redemption or payment
in full of all of the Certificates.
SECTION 7. Dissemination Agent The Issuer may, from time to time, appoint or
engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure
Undertaking, and may discharge any such Agent, with or without appointing a successor
11 -3
SECTION 8. Amendment; Waiver. Notwithstanding any other provision of this
Disclosure Undertaking, the Issuer may amend this Disclosure Undertaking, and any provision of
this Disclosure Undertaking may be waived, if (a) a change in law or change in the ordinary
business or operation of the Issuer has occurred, (b) such amendment or waiver would not, in and
of itself, cause the undertakings herem to violate the Rule if such amendment or waiver had been
effective on the date hereof but taking into account any subsequent change in or official
interpretation of the Rule, and (c) such amendment or waiver is supported by an opinion of
counsel expert in federal secunties laws to the effect that such amendment or waiver would not
materially impair the interests of Owners.
SECTION 9. Additional Information. Nothing in this Disclosure Undertaking shall be
deemed to prevent the Issuer from disseminating any other information, using the means of
dissemination set forth in this Disclosure Undertaking or any other means of communication, or
including any other information in any Annual Report or notice of an Occurrence, in addition to
that which is required by this Disclosure Undertaking. If the Issuer chooses to include any
information in any Annual Report or notice of an Occurrence in addition to that which is
specifically required by this Disclosure Undertaking, the Issuer shall have no obligation under
this Disclosure Undertaking to update such information or include it in any future Annual Report
or notice of an Occurrence.
SECTION 10. Default. In the event of a failure of the Issuer to provide information
required by this Disclosure Undertaking, any Owner may take such actions as may be necessary
and appropnate, including seeking mandamus or specific performance by court order, to cause
the Issuer to comply with its obligations to provide information under this Disclosure
Undertaking. A default under this Disclosure Undertaking shall not be deemed an Event of
Default under the Resolution, and the sole remedy under this Disclosure Undertaking in the event
of any failure of the Issuer to comply with this Disclosure Undertaking shall be an action to
compel performance.
SECTION 11. Beneficiaries This Disclosure Undertaking shall inure solely to the
benefit of the Issuer, the Participating Underwriters and Owners from time to time of the
Certificates, and shall create no nghts in any other person or entity.
SECTION 12. Reserved Rights. The Issuer reserves the nght to discontinue providing
any information required under the Rule if a final determination should be made by a court of
competent jurisdiction that the Rule is invalid or otherwise unlawful or, subject to the provisions
of Section 8 hereof, to modify the undertaking under this Disclosure Undertakmg if the Issuer
determines that such modification is required by the Rule or by a court of competent jurisdiction.
Date: 2006
CITY OF ROSEMOUNT, MINNESOTA
By
Its
By
Its
11-4
EXHIBIT A
List of Nationally Recognized Municipal
Secunties Information Repositones
Bloomberg Municipal Repository
100 Business Park Drive
Skillman, NJ 08558
Phone: 609 279 -3225
Fax: 609 -279 -5962
Email: MunisiciBloomberg.com
http:ThAww.bloomberu.com/markets/rates/municontacts.html
DPC Data Inc.
One Executive Drive
Fort Lee, NJ 07024
Phone. 201- 346 -0701
Fax: 201 947 -0107
Email: nrmsir(a,dpcdata.com
http: /w■w dpcdata.com
FT Interactive Data
Attn NRMSIR
100 William Street, 15 Floor
New York, NY 10038
Phone: 212-771-6999; 800-689-8466
Fax: 212- 771 -7390
Email: NRMSIR(a,interactivedata com
http: /www.ftid com
Standard Poor's Securities Evaluations, Inc.
55 Water Street
45th Floor
New York, NY 10041
Phone 212- 438 -4595
Fax: 212- 438 -3975
Email: NRMSIR repositorva,,sandp.com
www nkennv comnjkennv /pser descnp data rep.html
This list is current as of the date of issuance of the Certificates.
11 -5
CONTINUING DISCLOSURE UNDERTAKING
This Continuing Disclosure Undertaking (the 'Disclosure Undertaking is executed and
delivered by the City of Rosemount, Minnesota (the "Issuer in connection with the issuance of
$4,405,000 General Obligation Improvement Bonds, Senes 2006B (the "Bonds The Bonds are
being issued pursuant to a Resolution adopted May 16, 2006 (the "Resolution"). Pursuant to the
Resolution and this Undertaking, the Issuer covenants and agrees as follows:
SECTION 1. Purpose of the Disclosure Undertakma This Disclosure Undertaking is
being executed and delivered by the Issuer for the benefit of the Owners and in order to assist the
Participating linderwnters in complying with SEC Rule 15c2- 12(b)(5).
SECTION 2. Definitions. In addition to the definitions set forth in the Resolution, which
apply to any capitalized term used in this Disclosure Undertaking unless otherwise defined in this
Section, the following capitalized terms shall have the following meanings:
"Annual Report" shall mean any annual financial information provided by the Issuer
pursuant to, and as descnbed in, Sections 3 and 4 of this Disclosure Undertaking
"Audited Financial Statements" shall mean the financial statements of the Issuer audited
annually by an independent certified public accounting firm, prepared pursuant to generally
accepted accounting principles promulgated by the Financial Accounting Standards Board,
modified by governmental accounting standards promulgated by the Government Accounting
Standards Board.
"Dissemination Agent" shall mean such party from time to time designated in wnting by
the Issuer to act as information dissemination agent and which has filed with the Issuer a wntten
acceptance of such designation.
"Fiscal Year" shall be the fiscal year of the Issuer.
"Governing Body" shall, with respect to the Bonds, have the meaning given that term in
Minnesota Statutes, Section 475 51, Subdivision 9.
"MSRB" shall mean the Municipal Secunties Rulemaking Board.
"National Repository" shall mean any Nationally Recognized Municipal Securities
Information Repository for purposes of the Rule The National Repositones as of the date of
execution of this Undertaking are as listed on Exhibit A.
"Occurrence(s)" shall mean any of the events listed in Section 5.A. of this Disclosure
Undertaking.
"Official Statement" shall be the Official Statement dated 2006,
prepared in connection with the Bonds.
"Owners" shall mean the registered holders and, if not the same, the beneficial owners of
any Bonds.
11 -6
"Participating Underwnter" shall mean any of the original underwriters of the Bonds
required to comply with the Rule in connection with offenng of the Bonds
"Repository" shall mean each National Repository and each State Depository.
"Resolution" shall mean the resolution or resolutions adopted by the Governing Body of
the Issuer providing for, and authorizing the issuance of, the Bonds.
"Rule" shall mean Rule 15c2- 12(b)(5) adopted by the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as the same may be amended from time
to time or interpreted by the Securities and Exchange Commission
"State" shall mean the State of Minnesota.
"State Depository" shall mean any public or private repository or entity designated by the
State as a state depository for the purpose of the Rule. As of the date of this Disclosure
Undertaking, there is no State Depository in Minnesota.
SECTION 3. Provision of Annual Reports.
A. Beginning in connection with the Fiscal Year ending on December 31,
2005, the Issuer shall, or shall cause the Dissemination Agent to, as soon as available, but in any
event not later than December 31, 2006, and by December 31 of each year thereafter, provide to
each Repository an Annual Report which is consistent with the requirements of Section 4 of this
Disclosure Undertaking.
B. If the Issuer is unable to provide to the Repositories an Annual Report by
the date required in subsection A, the Issuer shall send a notice of such delay and estimated date
of delivery to each Repository or to the MSRB and to the State Depository, if any.
C. Any filing under this Disclosure Undertaking may be made solely by
transmitting such filing to the Texas Municipal Advisory Council (the "MAC as provided at
http: /www disclosureusa.ore unless the United States Securities and Exchange Commission has
withdrawn the interpretive advice in its letter to the MAC dated September 7, 2004.
SECTION 4. Content and Format of Annual Reports. The Issuer's Annual Report shall
contain or incorporate by reference the financial information and operating data pertaining to the
Issuer listed below as of the end of the preceding Fiscal Year The Annual Report may be
submitted to each Repository as a single document or as separate documents comprising a
package, and may cross reference other information as provided in this Disclosure Undertaking.
The following financial information and operating data shall be supplied:
A. An update of the type of information contained m the Official Statement
under the caption CITY PROPERTY VALUES, CITY INDEBTEDNESS; and CITY TAX
RATES, LEVIES AND COLLECTIONS;
B. Audited Financial Statements of the Issuer the Audited-Financial
Statements of the Issuer may be submitted to each Repository separately from the balance of the
11 -7
Annual Report. In the event Audited Financial Statements of the Issuer are not available on or
before the date for filing the Annual Report with the appropriate Repositories as set forth in
Section 3.A. above, unaudited financial statements shall be provided as part of the Annual
Report. The accounting principles pursuant to which the financial statements will be prepared
will be pursuant to generally accepted accounting principles promulgated by the Financial
Accountmg Standards Board, as such principles are modified by the governmental accounting
standards promulgated by the Government Accounting Standards Board, as in effect from time to
time If Audited Financial Statements are not provided because they are not available on or
before the date for filing the Annual Report, the Issuer shall promptly provide them to the
Repositones when available.
SECTION 5. Reporting of Significant Events.
A. This Section 5 shall govern the giving of notices of the occurrence of any
of the following events with respect to the Bonds, if material'
(1) principal and interest payment delinquency;
(2) non- payment related defaults;
(3) unscheduled draws on debt service reserves reflecting financial
difficulties;
(4) unscheduled draws on credit enhancements reflecting financial difficulties;
(5) substitution of credit or liquidity providers, or their failure to perform;
(6) adverse tax opinions or events affecting the tax- exempt status of the
security;
(7) modifications to rights of security holders;
(8) Bond calls;
(9) defeasances;
(10) release, substitution or sale of property securing repayment of the Bonds;
and
(11) rating changes.
B. Whenever an event listed in Section 5.A. above has occurred, the Issuer
shall as soon as possible determine if such event would constitute matenal information for
Owners of Bonds. If knowledge of the Occurrence would be material, the Issuer shall promptly
file a notice of such Occurrence with each National Repository or the MSRB and with the State
Depository, if any.
C. The Issuer agrees to provide or cause to be provided, in a timely manner,
to each National Repository or the MSRB and to the State Depository, if any, notice of a failure
by the Issuer to provide the Annual Reports descnbed in Section 4.
SECTION 6. Termination of Reporting, Obligation. The Issuer's obligations under this
Disclosure Undertaking shall terminate upon the legal defeasance, prior redemption or payment
in full of all of the Bonds.
SECTION 7. Dissemination Agent The Issuer may, from time to time, appoint or
gage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure
Undertaking, and may discharge any such Agent, with or without appointing a successor
Dissemination Agent.
11 -8
SECTION 8. Amendment Waiver. Notwithstanding any other provision of this
Disclosure Undertaking, the Issuer may amend this Disclosure Undertaking, and any provision of
this Disclosure Undertaking may be waived, if (a) a change in law or change in the ordinary
business or operation of the Issuer has occurred, (b) such amendment or waiver would not, in and
of itself, cause the undertakings herein to violate the Rule if such amendment or waiver had been
effective on the date hereof but taking into account any subsequent change in or official
interpretation of the Rule, and (c) such amendment or waiver is supported by an opinion of
counsel expert in federal secunties laws to the effect that such amendment or waiver would not
materially impair the interests of Owners.
SECTION 9 Additional Information. Nothing in this Disclosure Undertaking shall be
deemed to prevent the Issuer from disseminating any other information, using the means of
dissemination set forth in this Disclosure Undertaking or any other means of communication, or
including any other information in any Annual Report or notice of an Occurrence, in addition to
that which is required by this Disclosure Undertaking. If the Issuer chooses to include any
information in any Annual Report or notice of an Occurrence in addition to that which is
specifically required by this Disclosure Undertaking, the Issuer shall have no obligation under
this Disclosure Undertaking to update such information or include it in any future Annual Report
or notice of an Occurrence.
SECTION 10 Default. In the event of a failure of the Issuer to provide information
required by this Disclosure Undertaking, any Owner may take such actions as may be necessary
and appropnate, including seeking mandamus or specific performance by court order, to cause
the Issuer to comply with its obligations to provide information under this Disclosure
Undertaking. A default under this Disclosure Undertaking shall not be deemed an Event of
Default under the Resolution, and the sole remedy under this Disclosure Undertaking in the event
of any failure of the Issuer to comply with this Disclosure Undertaking shall be an action to
compel performance.
SECTION 11. Beneficiaries This Disclosure Undertaking shall inure solely to the
benefit of the Issuer, the Participating Underwriters and Owners from time to time of the Bonds,
and shall create no nghts in any other person or entity.
SECTION 12. Reserved Rights The Issuer reserves the right to discontinue providing
any information required under the Rule if a final determination should be made by a court of
competent junsdiction that the Rule is invalid or othenvise unlawful or, subject to the provisions
of Section 8 hereof, to modify the undertaking under this Disclosure Undertaking if the Issuer
determines that such modification is required by the Rule or by a court of competent jurisdiction.
Date 2006
By
Its
By
Its
11 -9
CITY OF ROSEMOUNT, MINNESOTA
EXHIBIT A
List of Nationally Recognized Municipal
Securities Information Repositories
Bloomberg Municipal Repository
100 Business Park Dnve
Skillman, NJ 08558
Phone: 609 279 -3225
Fax: 609 279 -5962
Email Munis(Bloomberz.com
http: /www.bloomben comimarkets /municipal contactinfo.html
DPC Data Inc.
One Executive Drive
Fort Lee, NJ 07024
Phone 201 346 -0701
Fax: 201- 947 -0107
Email: nrmsirna dpcdata.com
http://www.dpcdata.com
FT Interactive Data
Attnr NRMSIR
100 William Street, 15 Floor
New York, NY 10038
Phone: 212-771-6999; 800-689-8466
Fax 212 771 -7390
Email. NRMSWP,interactivedata corn
httpi /www.ftid.com
Standard Poor's Securities Evaluations, Inc.
55 Water Street
45th Floor
New York, NY 10041
Phone 212 -438 -4595
Fax: 212 -438 -3975
Email: NRMSIR repositoryna sandp.com
www.ukenny com/jjkennvipser descnp data rep.html
This list is current as of the date of issuance of the Bonds.
11 -10
SUMMARY OF TAX LEVIES, PAYMENT PROVISIONS, AND
MINNESOTA REAL PROPERTY VALUATION
(effective through payable 2006 with 2005 Legislative changes incorporated)
Property Valuations (Chapter 273, Minnesota Statutes)
APPENDIX III
Following is a summary of certain statutory provisions effective through payable 2006 relative to
tax levy procedures, tax payment and credit procedures, and the mechanics of real property
valuation. The summary does not purport to be inclusive of all such provisions or of the specific
provisions discussed, and is qualified by reference to the complete text of applicable statutes,
rules and regulations of the State of Minnesota
Assessor's Estimated Market Value Each parcel of real property subject to taxation must, by
statute, be appraised at least once every five years as of January 2 of the year of appraisal.
With certain exceptions, all property is valued at its market value, which is the value the
assessor determines to be the price the property to be fairly worth, and which is referred to as
the "Estimated Market Value."
Limitation of Market Value Increases Minn Stat Sec. 273.11, Subdivision la, was amended
in 2005. For assessment years 2005 and 2006, the amount of the increase shall not exceed
the greater of (1) 15% of the value in the preceding assessment, or (2) 25% of the difference
between the current assessment and the preceding assessment. For assessment year 2007,
the amount of the increase shall not exceed the greater of (1) 15% of the value in the preceding
assessment, or (2) 33% of the difference between the current assessment and the preceding
assessment. For assessment year 2008, the amount of increase shall not exceed the greater
of (1) 15% of the value in the preceding assessment or (2) 50% of the difference between the
current assessment and the preceding assessment.
Taxable Market Value The Taxable Market Value is the value that property taxes are based
on, after all reductions, limitations, exemptions and deferrals It is also the value used to
calculate a municipality's legal debt limit.
Indicated Market Value The Indicated Market Value is determined by dividing the Taxable
Market Value of a given year by the same year's sales ratio determined by the State
Department of Revenue. The Indicated Market Value serves to eliminate disparities between
individual assessors and equalize property values statewide.
Net Tax Capacity The Net Tax Capacity is the value upon which net taxes are levied,
extended and collected The Net Tax Capacity is computed by applying the class rate
percentages specific to each type of property classification against the Taxable Market Value.
Class rate percentages vary depending on the type of property as shown on the last page of
this Appendix. The formulas and class rates for converting Taxable Market Value to Net Tax
Capacity represent a basic element of the State's property tax relief system and are subject to
annual revisions by the State Legislature.
Property taxes are determined by multiplying the Net Tax Capacity by the tax capacity rate,
expressed as a percentage.
Property Tax Payments and Delinquencies
(Chapters 275, 276, 277, 279 -282 and 549, Minnesota Statutes)
Ad valorem property taxes levied by local governments in Minnesota are extended and
collected by the various counties within the State Each taxing jurisdiction is required to certify
the annual tax levy to the county auditor within five (5) working days after December 20 of the
year preceding the collection year A listing of property taxes due is prepared by the county
auditor and turned over to the county treasurer on or before the first business day in March.
The county treasurer is responsible for collecting all property taxes within the county. Real
estate and personal property tax statements are mailed out by March 31. One -half (1/2) of the
taxes on real property is due on or before May 15. The remainder is due on or before
October 15 Real property taxes not paid by their due date are assessed a penalty that,
depending on the type of property, increases from 2% to 4% on the day after the due date. in
the case of the first installment of real property taxes due May 15, the penalty increases to 4%
or 8% on June 1. Thereafter, an additional 1% penalty shall accrue each month through
October 1 of the collection year for unpaid real property taxes. In the case of the second
installment of real property taxes due October 15, the penalty increases to 6% or 8% on
November 1 and increases again to 8% or 12% on December 1. Personal property taxes
remaining unpaid on May 16 are deemed to be delinquent and a penalty of 8% attaches to the
unpaid tax. However, personal property that is owned by a tax exempt entity, but is treated as
taxable by virtue of a lease agreement, is subject to the same delinquent property tax penalties
as real property.
On the first business day of January of the year following collection all delinquencies are
subject to an additional 2% penalty, and those delinquencies outstanding as of February 15 are
filed for a tax lien judgment with the district court By March 20 the clerk of court files a
publication of legal action and a mailing of notice of action to delinquent parties Those
property interests not responding to this notice have judgment entered for the amount of the
delinquency and associated penalties. The amount of the judgment is subject to a variable
interest determined annually by the Department of Revenue, and equal to the adjusted prime
rate charged by banks, but in no event is the rate less than 10% or more than 14
Property owners subject to a tax lien judgment generally have five years (5) in the case of all
property located outside of cities or in the case of residential homestead, agricultural
homestead and seasonal residential recreational property located within cities or three (3) years
with respect to other types of property to redeem the property After expiration of the
redemption period, unredeemed properties are declared tax forfeit with title held in trust by the
State of Minnesota for the respective taxing districts. The county auditor, or equivalent thereof,
then sells those properties not claimed for a public purpose at auction The net proceeds of the
sale are first dedicated to the satisfaction of outstanding special assessments on the parcel,
with any remaining balance in most cases being divided on the following basis county 40
town or city 20 and school district 40
Property Tax Credits (Chapter 273, Minnesota Statutes)
In addition to adjusting the taxable value for various property types, primary elements of
Minnesota's property tax relief system are property tax levy reduction aids; the circuit breaker
credit, which relates property taxes to income and provides relief on a sliding income scale, and
targeted tax relief, which is aimed pnmarily at easing the effect of significant tax increases The
circuit breaker credit and targeted credits are reimbursed to the taxpayer upon application by
the taxpayer Property tax levy reduction aid includes educational aids, local governmental aid,
equalization aid, county program aid and disparity reduction aid.
111-2
Debt Limitations
All Minnesota municipalities (counties, cities, towns and school districts) are subject to statutory
"net debt" limitations under the provisions of Minnesota Statutes, Section 475 53 Net debt is
defined as the amount remaining after deducting from gross debt the amount of current
revenues that are applicable within the current fiscal year to the payment of any debt and the
aggregate of the principal of the following
1. Obligations issued for improvements that are payable wholly or partially from the
proceeds of special assessments levied upon benefited property.
2. Warrants or orders having no definite or fixed maturity.
3. Obligations payable wholly from the income from revenue producing conveniences.
4. Obligations issued to create or maintain a permanent improvement revolving fund.
5. Obligations issued for the acquisition and betterment of public waterworks systems,
and public lighting, heating or power systems, and any combination thereof, or for any
other public convenience from which revenue is or may be derived
6. Certain debt service loans and capital loans made to school districts.
7. Certain obligations to repay loans.
8. Obligations specifically excluded under the provisions of law authorizing their
issuance.
9. Certain obligations to pay pension fund liabilities.
10. Debt service funds for the payment of principal and interest on obligations other than
those described above.
11. Obligations issued to pay judgments against the municipality.
Levies for General Obligation Debt
(Sections 475.61 and 475.74, Minnesota Statutes)
Any municipality that issues general obligation debt must, at the time of issuance, certify levies
to the county auditor of the county(ies) within which the municipality is situated. Such levies
shall be in an amount that if collected in full will, together with estimates of other revenues
pledged for payment of the obligations, produce at least five percent in excess of the amount
needed to pay principal and interest when due. Notwithstanding any other limitations upon the
ability of a taxing unit to levy taxes its ability to levy taxes for a deficiency in prior levies for
payment of general obligation indebtedness is without limitation as to rate or amount
Metropolitan Revenue Distribution (Chapter 473F, Minnesota Statutes)
"Fiscal Disparities Law"
The Charles R Weaver Metropolitan Revenue Distribution Act, more commonly known as
"Fiscal Disparities," was first implemented for taxes payable in 1975. Forty percent of the
increase in commercial industrial (including public utility and railroad) net tax capacity valuation
since 1971 in each assessment district in the Minneapolis /St. Paul seven county metropolitan
area (Anoka, Carver, Dakota, excluding the City of Northfield, Hennepin, Ramsey, Scott,
excluding the City of New Prague, and Washington Counties) is contributed to an area -wide tax
base. A distribution index, based on the factors of population and real property market value
percapitd, is emptoyedin determining pruportrorrof the nettax capacity value m Lf le area=
wide tax base shall be distributed back to each assessment district
III -3
STATUTORY FORMULAE: CONVERSION OF ESTIMATED MARKET VALUE (EMV) TO
NET TAX CAPACITY FOR MAJOR PROPERTY CLASSIFICATIONS
Local Tax Local Tax Local Tax Local Tax Local Tax
Payable Payable Payable Payable Payable
Property Type 2002 2003 2004 2005 2006
Residential Homestead
Up to $500,000 1 000% 1.000% 1.000% 1.000% L000%
Over $500,000 1 250% 1.250% 1.250% 1.250% 1.250%
Residential Non homestead
Single Unit
Up to $500,000 1.000% 1.000% 1.000% 1.000% 1.000%
Over $500,000 1 250% 1.250% 1 250% 1 250% 1.250%
2 -3 unit and undeveloped land 1 500% 1.250% 1 250% 1 250% 1.250%
Market Rate Apartments
Regular 1 800% 1 500% 1.250% 1.250% 1.250%
Small City 1 800% 1 500% 1 250% 1.250% 1.250%
Low Income 0 900 1.000% 0.750
Commercial /Industrial /Public Utility
Up to $150,000 1 500% 1.500% 1.500% 1.500% 1.500%
Over $150,000 2 000% 2 000% 2 000% 2 000% 2000%
Electric Generation Machinery 2 000% 2.000% 2 000% 2 000% 2.000%
Seasonal Recreational Commercial
Homestead Resorts (1c)
Up to $500,000 1 000% 1.000% 1.000% 1 000% 0.550%
$500,000 $2,200,000 1 250% 1.250% 1 250% 1 250% 1.000%
Over $2,200,000 1 250% 1.250% 1 250% 1.250% 1.250%
Seasonal Resorts (4c)
Up to $500,000 1.000% 1.000% 1.000% 1 000% 1.000%
Over $500,000 1.250% 1.250% 1.250% 1 250% 1.250%
Seasonal Recreational Residential
Up to $500,000 1 000 1.000 1.000 1.000 1 000
Over $500,000 1 250 1.250% 1.250 1.250 1.250
Disabled Homestead 0 4 50% 0 450% 0 450% 0 450% 0.450%
Agricultural Land Buildings
Homestead
Up to $600,000 0 550 0 550 0.550 0.550 0 550%
Over $600,000 1 000 1.000 1.000 1.000 1 000%
Non homestead 1 000 1 000 1.000 1.000 1 000
1 Rate increased to 1% in pay 2003 classification abolished for pay 2004 and pay 2005, and re- established at a rate
of 0 75% in pay 2006 and thereafter
2 Exempt from referendum market value tax
111-4
EXCERPT OF 2004 ANNUAL FINANCIAL STATEMENTS
APPENDIX IV
The City's financial statements are audited annually by an independent certified public
accounting firm in conformance with generally accepted accounting principles. Selected
audited financial statements for the fiscal year ending December 31, 2004 are presented here.
Governmental funds and expendable trust funds are accounted for using the modified accrual
basis of accounting. Proprietary funds are accounted for using the accrual basis of accounting.
The reader should be aware that the complete financial statements may contain additional data
relating to the information presented here, which may interpret, explain or modify et.
The Governmental Accounting Standards Board (GASB) issued Statement 34, Basic Financial
Statements for State and Local Governments in June 1999. The statement establishes a new
financial reporting model for state and local governments and is a significant change in public
sector accounting GASB developed the new requirements to make annual reports more
comprehensive and easier to understand and use. The new requirements include government
wide financial statements prepared on the full accrual basis that are in addition to, not instead
of, the traditional Fund -Based statements, and an expanded Budget Comparison that includes
the adopted budget, final budget, and actual revenues and expenditures The City's 2004
financial statements are prepared in conformance with GASB principles.
The City's comprehensive annual financial report for the year ended 2003 was awarded the
Certificate of Achievement for Excellence in Financial Reporting by the Government Finance
Officers Association of the United States and Canada (GFOA) The Certificate of Achievement
is the highest form of recognition for excellence in state and local government financial
reporting.
In order to be awarded a Certificate of Achievement, a government unit must publish an easily
readable and efficiently organized comprehensive annual financial report (CAFR), whose
contents conform to program standards Such CAFR must satisfy both generally accepted
accounting principles and applicable legal requirements
A Certificate of Achievement is valid for a period of one year only. The City has received this
recognition annually since 1996 and has submitted its 2004 CAFR to GFOA for consideration.
IV -1
VirchowKrause
8(companv
INDEPENDENT AUDITORS' REPORT
To The Honorable Mayor and Members of the City Council
City of Rosemount, Minnesota
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, each major fund, and the aggregate remaining fund information of the City of Rosemount, Minnesota, as
of and for the year ended December 31, 2004, which collectively comprise the City's basic financial statements as
listed in the table of contents These financial statements are the responsibility of the City of Rosemount's
management. Our responsibility is to express opinions on these financial statements based on our audit. The prior
year summarized comparative information has been derived from the City's 2003 financial statements and, in our
report date March 12, 2004, we expressed unqualified opinions on the respective financial statements of the
governmental activities, the business -type activities, the aggregate discretely presented component units, each
major fund, and the aggregate remaining fund information
We conducted our audit in accordance with auditing standards generally accepted in the United States of America.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall
financial statement presentation We believe that our audit provides a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in alt material respects, the respective
financial position of the governmental activities, the business -type activities, each major fund, and the aggregate
remaining fund information of the City of Rosemount, Minnesota, as of December 31, 2004, and the respective
changes in financial position and cash flows, where applicable, thereof for the year then ended in conformity with
accounting principles generally accepted in the United States of America
The management's discussion and analysis on pages 2 through 10 and the budgetary comparison schedules on
pages 55 through 57 are not required parts of the basic financial statements, but are supplementary information
required by the Governmental Accounting Standards Board We have applied certain limited procedures, which
consisted principally of inquiries of management regarding the methods of measurement and presentation of the
required supplementary information However, we did not audit the information and express no opinion on it.
The Rosemount Port Authority, previously reported as a discreetly presented component unit, has been presented
as a blended component unit.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise
the City of Rosemount's basic financial statements The introductory section, combining anc indiviaual fund
statements and schedules, and statistical tables, as listed in the table of contents, are presented for purposes of
additional analysis and are not a required part of the basic financial statements. The combining and individual fund
statements and schedules have been subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial
statements taken as a whole The introductory section and statistical tables have not been subjected to the
auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion
on them.
Munreapulis, Minnesota
March 18, 2005
Lt iassa
IV -2
ASSETS
Cash and investments
Receivables (net of allowance for uncollectibles)
Taxes
Delinquent taxes
Accounts
Loans
Special assessments
Due from other governmental units
Internal balances
Prepaid items
Capital assets:
Land
Construction in progress
Land improvements
Buildings
Machinery and equipment
Infrastructure
Less: accumulated depreciation
Total Assets
LIABILITIES
Accounts payable
Accrued payroll and payroll taxes
Other accrued liabilities and deposits
Noncurrent liabilities.
Due within one year
Due in more than one year
Total Liabilities
NET ASSETS
Invested in capital assets, net of related debt
Restricted
Unrestricted
Total Net Assets
CITY OF ROSEMOUNT
STATEMENT OF NET ASSETS
December 31, 2004
(With Comparative Totals for December 31, 2003)
Govemmental
Activities
Business
Type
Activities
24,326,440 18,375,608
593,875
113,870
90,016 756,141
578,597
3,480,742 487,585
123,486 57,217
(519,059) 519,059
84,157 67,427
4,392,454 1,609,237
2,891,251 8,247,046
959,852
9,938,567 6,144,727
6,763,400 1,661,116
25,509,800 90,484,043
(12,191,224) (31,903,013)
67,136,224 96,506,193
2004 2003
42,702,048
593,875
113,870
846,157
578,597
3,968,327
180.703
151,584
6,001,691
11,138,297
959,852
16,083,294
8,424,516
115,993,843
(44,094,237)
163,642,417
Totals
37,786,731
531,873
106,839
732,576
618,431
5,465,761
56,064
159,717
3,974,730
14,025,023
936,547
15,987,784
8,333,974
104,394,537
(41,472,005)
151,638,582
1,426,225 57,798 1,484,023 1,433,305
141,392 141,392 95,111
254,853 140,920 395,773 582,710
3,503,914 735,000 4,238,914 3,786,063
18,291,089 5,799,166 24,090,255 28,079,169
23,617,473 6,732,884 30,350,357 33,976,358
17,030,985 69,812,374 86,843,359 82,170,804
6,910,541 6,910,541 7,531,705
26,487,766 13,050,394 39,538,160 27,959,715
43,518,751 89,773,309 133,292,060 117,662,224
See accompanying notes to financial statements.
IV -3
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ASSETS
Cash and investments
Receivables:
Taxes
Accounts
Loans
Special assessments
Delinquent special assessments
Due from other govemmental units
Due from other funds
Prepaid items
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Accrued payroll and payroll taxes
Due to other funds
Deposits payable
Contracts payable
Deferred revenue
Advances from other funds
Total liabilities
Fund balances
Reserved for:
Debt service
Encumbrances
Prepaid items
Unreserved and designated, reported in
General fund
Capital protects
Special projects
Unreserved and undesignated (deficit), reported in
General fund
Special revenue funds
Total fund balances
Total I:abrhties and fund balances
CITY OF ROSEMOUNT
BALANCE SHEET GOVERNMENTAL FUNDS
December 31, 2004
General
5,419,678 9,441,517
586,594
59,901
88,735
580
8,316
297
30,048
6,194,149 12,764,900
270,899
141,392
31,450
271,660
715,401 3,256,227 1,058,820
503,524
30,048
4,931,177
13,999
NET ASSETS OF GOVERNMENTAL ACTIVITIES
See accompanying notes to financial statements
IV -5
Other Total
Governmental Govemmental
Debt Service Capital Projects Funds Funds
3,220,802
102,581
3,256,227
9,508,673
3,656,520 5,226,790
7,281
20,987
578,597
171,205
10,709
115,170
335
3,771,690 6,015,904
557,558
501,262
2,712,870
1,630,159
335
3,117,074
(92,969)
5,478,748 9,508,673 2,712,870 4,654,599
6,194,149 12,764,900 3,771,690 6,015,904
Amounts reported for governmental activities in the statement of net assets are different because
Capital assets used in governmental funds are not financial resources and, therefore, are not reported in the funds.
Some receivables that are not currently available are reported as deferred revenue in the fund financial
statements but are recognized as revenue when earned in the government -wide statements
Internal service funds are reported in the statement of net assets as governmental activities
Some liabilities, including long -term debt, are not due and payable in the current penod and, therefore, are not
reported in the funds. See Note IIA
23,744,505
593,875
80,888
578,597
3,480,742
113,870
123,486
297
30,383
28,746,643
82,643 911,100
141,392
297 297
31,450
501 262
759,306 4,287,193
519,059 519,059
1,361,305 6,391,753
9,508,673
2,133,683
30,383
4,931,177
2,712,870
3,117,074
13,999
(92,969)
22,354,890
38,264,100
4,287,193
630,973
(22,018,405)
43,518,751
CITY OF ROSEMOUNT
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS
For the Year Ended December 31, 2004
Other Total
Governmental Govemmental
General Debt Service Capital Projects Funds Funds
REVENUES
Taxes 5,136,759 1,437,546 1,536,653 8,110,958
Intergovernmental 218,832 1,710,697 54,209 1,983,738
Public charges for services 1,473,581 1,324,616 2,798,197
Licenses and permits 1,295,164 1,295,164
Fines and forfeitures 96,902 2,045 98,947
Special assessments 41,183 1,077.740 330,900 140,203 1,590,026
Investment income and miscellaneous 214,120 172,040 8 073.381 85,422 8,544,963
Total Revenues 8,476,541 2,689,371 10,114,978 3,141,103 24,421,993
EXPENDITURES
Current:
General government
Public safety
Public works
Parks and recreation
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
1,880,941 17,798 1,896,739
2,233,232 1,135 2,234,367
2,037,603 12,661 572,841 2,623,105
980,841 980,841
11,820,615 648,871 12,469,486
7,132,617
IV e
2,760,000
913,131
3,673,131
Excess (deficiency) of revenues
over (under) expenditures 1,343,924 (983,760) (1,718,298) 1,579,859 221,725
OTHER FINANCING SOURCES (USES)
Sale of capital assets 6,350 6,350
Transfers in 11,677 932,199 1,987,884 683,509 3,615,269
Transfers out (590,000) (527,348) (953,594) (2,070,942)
Total Other Financing Sources (Uses) (578,323) 932,199 1,460,536 (263,735) 1,550,677
Net Change in Fund Balance 765,601 (51,561) (257,762) 1,316,124 1,772,402
11,833,276
251,929 3,011,929
68,67D 981.801
1,561,244 24,200,268
FUND BALANCES Beginning 4,713,147 9,560,234 2,970,632 3,338,475 20,582,488
FUND BALANCES ENDING 5,478,748 9,508,673 2,712,870 4,654,599 22,354,890
See accompanying notes to financial statements.
CITY OF ROSEMOUNT
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2004
Net change in fund balances total governmental funds 1,772,402
Amounts reported for govemmental activities in the statement of activities
are different because:
Governmental funds report capital outlays as expenditures However, in the
statement of net assets the cost of these assets is capitalized and they are
depreciated over their estimated useful lives with depreciation expense reported
in the statement of activities.
Capital outlay is reported as an expenditure in the fund financial statements
but is capitalized in the government -wide financial statements
Less: Some items reported as capital outlay but not capitalized
Some items reported as capital outlay in the fund statements but are shown as
transfers in the government -wide statements
Depreciation is reported in the government -wide statements
In the statement of activities, only the gain or loss ($110,586) on the disposal of
capital assets is reported In the fund financial statements, proceeds from the sale
of capital assets ($6,350) are reported because the proceeds increase
financial resources
Internal service funds are reported in the statement of activities.
Receivables not currently available are reported as deferred revenue in the fund financial
statements but are recognized as revenue when earned in the government -wide
financial statements
Repayment of debt principal is an expenditure in the govemmental funds, but the
repayment reduces long term liabilities in the statement of net assets This is the amount
of principal payments paid
Some expenses in the statement of activities do not require the use of
current financial resources and, therefore, are not reported as expenditures
in the governmental funds. This is the change in the following liabilities
Compensated absences
Accrued interest on debt
CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES
See accompanying notes to financial statements.
IV -7
12,469,488
(2,495,361)
(6,631,615)
(1,235,075)
(104,236)
21,695
(1,014,641)
3,011,929
(65,106)
178 844
5,908,324
CITY OF ROSEMOUNT
STATEMENT OF NET ASSETS PROPRIETARY FUNDS
December 31, 2004
Business -Type Activities Enterprise Funds
Storm Non -major
Water Sewer Water Arena
ASSETS
Current assets
Cash and investments 7,056,853 5,880,026 5434,406 4 323 18,375,608 581,935
Customer accounts receivable 324,440 282,626 149,075 756,141 9,128
Special assessments receivable 84,897 254,403 148 285 487 585
Due from other governments 57,217 57,217
Prepaid items 6,307 56,064 2,534 2,522 67,427 53,774
Total current assets 7,472,497 6,473,119 5,734,300 64,062 19,743,978 644,837
Non current assets:
Advance to other funds 618,046 618,046
Property and equipment
Land 515,101 1,094,136 1,609,237
Buildings 2,619,393 263,014 862,420 2,399,900 6,144,727
Mains and lines 8,502,571 6,490,469 10,247,767 25,240,807
Other improvements 15,709,459 36,983,749 12,550,028 65,243,236
Machinery and equipment 973,863 449,675 142,980 94,598 1,661,116
Construction in progress 2,742,387 1,443,443 4.061,216 8,247,046
Less accumulated depreciation (7,464,495) (20,339,041) (3,565,761) (533,716) (31,903,013)
Net property and equipment 23.598.279 25,291,309 25,392,786 1,960,782 76,243,156
Total non -current assets 23,598,279 25,909,355 25,392,786 1,960,782 76 861 202
Total Assets
31,070,776 32,382,474 31,127,086 2,024,844 96,605,180 644,837
LIABILITIES
Current liabilities
Accounts payable 32,949 9,693 8,678 6,478 57,798 13,864
Accrued liabilities 10,655 9,059 3,422 4,684 27 820
Accrued interest 37,419 75,681 113,100
Current portion of long term debt 380,000 355,000 735,000
Total current liabilities 461,023 18,752 442,781 11,162 933.718 13,864
Noncurrent liabilities
Accrued compensated absences 38,545 38,545 12,788 13,506 103,384
General obligation debt 1,999,066 3,696,716 5,695,782
Advances from other funds 98,987 98,987
Total noncurrent liabilities 2,136,598 36,545 3,709,504 13,506 5,898,153
Total Liabilities 2,597,621 5 4, 24,668 6,831,871 13,864
NET ASSETS
Invested in capital assets, net of related debt 21,219,213 25,291,309 21,341,070 1,960,782 69,812,374
Restricted for debt service 2,395 003 435,541 4,080,000 6,910,541
Unrestricted 4 858,942 6,598,327 1.553 731 39,394 13,050,394 630.973
TOTAL NET ASSETS
28,473,155 32,325,177 26,974,801 2,000,176 69,773,309 630,973
See accompanying notes to financial statements.
IV -8
Total
Governmental
Activities
Internal Service
Fund
OPERATING REVENUES
Charges for services 1,004,057 1,124,398 601,737 337,912 3,058,104
Water meters 185,083 185,083
Mrscellaneous 1,149 77 1,226 34,443
Total Operating Revenues 1,189,140 1,125,547 601,814 337,912 3,254,413 34,443
OPERATING EXPENSES
Personnel services 333,668 340,086 127,819 159,098 960,671
Supplies 275,499 28,597 2,349 36,430 342,875 77
Professional services and charges 79,878 28,048 40,940 8,397 157,263 26,957
Other services and charges 486,043 71,844 28,847 133,311 720,045 215,156
Metro sewer charges 545,452 546,452
Depreciation 487,874 682,981 347.928 54,334 1.573.117
Total Operating Expenses 1.662,952 1,698.008 547,883 391 570 4,300,423 242,190
Operating Income (Loss)
NONOPERATING REVENUES (EXPENSES)
Connection fees 1,957,729 951,911
Taxes
Special assessments 75,140 62,940 115,760 253,840
Investment income 138,665 194,360 113,785 212 447 0221
Net increase (decrease) in fair value of investment (8,850) 2,015 119 (6,716)
Loss from disposal of fixed assets (270) (82) (352)
Surcharges and pena)ties 214,297 11,786 4,432 230,515
Interest expense and fiscal agent fees (100,338) (5 190) (189518) (295,045)
Total Nonoperating Revenues 2,276,373 1,217,740 1,177,515 212 4,671,840
Income (loss) before contnbutions
and transfers
Capital contributions
Transfers in
Transfers out
Change in Net Assets
TOTAL NET ASSETS Beginning
TOTAL NET ASSETS ENDING
CITY OF ROSEMOUNT
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND
NET ASSETS PROPRIETARY FUNDS
For the Year Ended December 31, 200
Business -Type Activities Enterprrse Funds
Governmental
Act,v,Les
Storm Non major Internal Service
Water Sewer Water Arena Total Funds
(473,822) (572,461) 53,931 (53,658) (1,046,010) (207.747)
1,132,937
1,802,551 645,279 1,231,446 (53,446) 3,625,830 21,695
1,047,011 2,187,862 4,405,136 7,640,009
64,000 64,000
(459,495) (162,263) (972 059) (14,500) (1,608,327)
2,390,067 2,670,878 4,728,513 (67,946) 9,721,512 21,695
26,083,088 29,654.299 22 246,288 2,068,122 80,051,797 609,278
28,473,155 32,325 177 25,974,801 2,000 176 89.773,309 630,973
See accompanying notes to financial statements
IV -9
4,042,577
225,000
4,442
229,442
CASH FLOWS FROM INVESTING ACTIVITIES
Westmont income
Net Cash Flows From Investing AcMees
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Debt rebred
Capdal advances to other funds
Interest peal
Capital con nbubons
Acquisition and corlstruchon of capdal assets
Net Cash Flows Used by Capital and
Net Increase (Decrease) in Cash
and Cash Egamlens
CASH AND CASH EQUIVALENTS Beginning of Year
Non-cash capital, investing financing activities:
CITY OF ROSEMOUNT
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the Year Ended Dxet trm 31, 2004
Governmental
Activities
Waler Sewer Storm Na major Internal
Utility teddy Water Arena Total Serrtce Funds
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers 3.366280 2,147.071 1,848.823 326,326 7,688,500 26.973
Cash paid to suppliers for goods and servrxs (1.027,600) (747,751) (103,675) (202,305) (2,081,331) (227,198)
Cash pad Wempbyees forsmvrces (270,354) (276.688) (101.923) (131,661) (785,626 Net Cash Flows From (Used by) Operating Activities 2,068,326 1 122,632 1.643 225 (7,840) 4.826 343 (200 225)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Property taxes 225,000
Transfers from other funds (14,500) (14500)
Net Cash Flows From (Used by) Noncaptal Fnaling Acbwties (14 500) (14 500) 225 000
129 815 196 375 113,904 212 440,306
129,815 196,375 113,904 212 440.306
(260,000)
(4,811) (265,138)
(104,180) (5,190)
799.280 2246 787
(1 530,050) (2 443 147)
Related Fnancing Acbvmes (1,099,761) (466668) (1.367.569) (2.954,015)
1.098,380 852,319 369.560 (22,128) 2.298 131 29217
5.958,473 5,027707 5,064,846 26,451 16,077,477 552718
CASH AND CASH EQUIVALENTS END OF YEAR 7 056 853 5 880 026 5 434 406 S 4,323 18 375.608 581,935
RECONCILIATION OF OPERATING INCOME TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
Operating income (loss) (473822) S (572461) 53.931 (53.656) S (1.046510) (207,747)
Non-operating income 2.246 896 1 026,555 1.253 129
Adjustments to Reconcile Operating Income to
Net Cash Flows From Operating Activities
Noncash nems included in income
Deprecation 487 ,874 682.981 347.927 54,334 1,573,116
Change in assets and habihbes
Accounts receivable (69 756) (5,031) (5120) (85907) (7,470)
Due from other governments (11586) (11586)
Due from other funds
Prepayments 743 (5,698) 314 855 (3.786) 13,873
Accounts payable (125556) (6,669) (6,282) 712 (135795) 1,119
Deposits 865 865
Accrued lobelias 2082 2 955 326 1.503 6.856
NET CASH FLOWS FROM (USED BY)
OPERATING ACTIVITIES 2 068 326 1.122 632 1.643.225 (7,840) 4.826 343 (200225)
The Water Utility received contributed plant of S213,475 during the year The Sewer Utility received contributed psnt of $15.546 dung the year
The Storm Water Utility received contributed plant of $100,950 dunng the year
See accompanying notes to financial statements
IV -10
Business -Type Actrvrtit Enterprise Funds
(340,000)
(190.214)
4,265,886
(5 123.241)
(600,000)
(269,949)
(299,584)
7,311,953
(9,096,436)
4 442
4,442
ASSETS
Cash and investments
LIABILITIES
Due to M.A.A.G.
CITY OF ROSEMOUNT
STATEMENT OF NET ASSETS
FIDUCIARY FUNDS
December 31, 2004
NET ASSETS
See accompanying notes to financial statements.
IV -11
M.A.A.G.
Agency
Fund
14,566
14,566
CITY OF ROSEMOUNT
INDEX TO NOTES TO FINANCIAL STATEMENTS
December 31, 2004
NOTE Page
I. Summary of Significant Accounting Policies 22
A. Reporting Entity 22
B. Government -Wide and Fund Financial Statements 23
C. Measurement Focus, Basis of Accounting,
and Financial Statement Presentation 25
D. Prior Period Information 27
E. Assets, Liabilities, and Net Assets or Equity 28
1. Deposits and Investments 28
2. Receivables 28
3. Inventories and Prepaid Items 29
4. Capital Assets 30
5. Other Assets 31
6. Compensated Absences 31
7. Long -Term Obligations /Conduit Debt 32
8. Claims and Judgments 32
9. Equity Classifications 33
10. Comparative Data /Reclassifications 33
II. Reconciliation of Government -Wide and Fund Financial Statements 34
A Explanation of Certain Differences Between the
Governmental Fund Balance Sheet and the Statement of Net Assets 34
III. Stewardship, Compliance, and Accountability 34
A. Budgetary Information 34
B. Excess Expenditures Over Appropriations 35
C. Deficit Balances 35
IV. Detailed Notes on All Funds 35
A Deposits and Investments 35
B. Receivables 37
C Capital Assets 38
D. lnterfund Rece vables /Payables and Transfers 40
E Long -Term Obligations 43
F. Lease Disclosures 46
G. Net Assets /Fund Balances 46
V. Other Information 49
A Employees' Retirement System 49
B. Risk Management 53
C. Commitments and Contingencies 54
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NOTE V OTHER INFORMATION (cont.)
C. COMMITMENTS AND CONTINGENCIES
CITY OF ROSEMOUNT
NOTES TO FINANCIAL STATEMENTS
December 31, 2004
From time to time, the City is party to various pending claims and legal proceedings. Although the
outcome of such matters cannot be forecasted with certainty, it is the opinion of management that
the likelihood is remote that any such claims or proceedings will have a material adverse effect on
the City's financial position or results of operations.
The City has received federal and state grants for specific purposes that are subject to review and
audit by the grantor agencies. Such audits could lead to requests for reimbursements to the
grantor agency for expenditures disallowed under terms of the grants. Management believes such
disallowances, if any, would be immaterial
Funding for the operating budget of the City comes from many sources, including property taxes,
grants and aids from other units of government, user fees, fines and permits, and other
miscellaneous revenues. The State of Minnesota provides a variety of aid and grant programs
which benefit the City. Those aid and grant programs are dependent on continued approval and
funding by the Minnesota governor and legislature, through their budget processes. The State of
Minnesota is currently experiencing budget problems, and is considering numerous alternatives
including reducing aid to local governments. Any changes made by the State to funding or
eligibility of local aid programs could have a significant impact on the future operating results of
the City
IV -29