HomeMy WebLinkAbout15.F.5. Improvement/Refunding Bond Sale-Res. No. 6018, 6019
IS. F.5:-
CITY OF SHAKOPEE COr~SENT
Memorandum
TO: Mayor and Council
Mark McNeill, City Administrator
FROM: Gregg Voxland, Finance Director
SUBJ: Improvement/Refunding Bond Sale
DATE: February 25, 2004
Introduction
Council action is needed for setting the sale of improvement
bonds for 2003 and 2004 projects.
Background
Attached are resolutions prepared by bond counsel that sets
the sale of improvement bonds for 2003 and 2004. This is a
routine event. The bonds to be sold are in the amount of
$4,225,000. The financed projects are West Dean Lake,
Valley View/Greenfield, and Veirling Drive/CR 15 East.
Also included is refunding the 1997 GO Building Bonds (fire
station) to achieve a lower interest rate and save an
estimated $174,000 (present value) .
The bond sale schedule is set to adopt this repo1ution on
March 1, sell the bonds on April 6th with settlement in
about 30 days.
Action
Offer Resolution No. 6018 A Resolution Providing For The
Issuance and Sale of $4,225,000 General Obligation
Improvement Bonds, Series 2004A, and move its adoption.
Offer Resolution No. 6019 A Resolution Providing For The
Issuance and Sale of $2,280,000 General Obligation Building
Refunding Bonds, Series 2004B, and move its adoption.
Gregg Voxland
Finance Director
g\finance\cash\bonds\04Abonds
Extract of Minutes of Meeting
of the City Council of the City
of Shako pee, Scott County, Minnesota
Pursuant to due call and notice thereof a regular meeting of the City Council of the City
of Shakopee, Scott County, Minnesota, was held at the City Hall in the City on Monday, March
1,2004, commencing at 7:00 o'clock P.M.
The following members of the Council were present:
and the following were absent:
* * * * * * * * *
The following resolution was presented by Councilmember , who moved
its adoption:
RESOLUTION NO. 6018
RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF
$4,225,000 GENERAL OBLIGATION IMPROVEMENT
BONDS, SERIES 2004A
BE IT RESOLVED By the City Council of the City of Shakopee, Scott County,
Minnesota (City) as follows:
1. It is hereby determined that:
(a) the following assessable public improvements (the Improvements)
have been made, duly ordered or contracts let for the construction thereof, by the City
pursuant to the provisions of Minnesota Statutes, Chapter 429 (Act);
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Proiect Designation & Description: Total Project Cost
West Dean Lake Project
Vierling/CR 15 East
Valley View/Greenfield
Project Costs $4,072,192.50
Deposit to Capitalized Interest Fund 89,332.50
Total Underwriter's Discount 33,800.00
Costs of Issuance 29,675.00
Total $4,225,000.00
(b) it is necessary and expedient to the sound financial management of
the affairs of the City to issue $4,225,000 General Obligation Improvement Bonds, Series
2004A (Bonds) pursuant to the Act to provide financing for the Improvements.
2. To provide financing for the Improvements, the City will issue and sell Bonds in
the amount of $4,191,200. To provide in part the additional interest required to market the
Bonds at this time, additional Bonds will be issued in the amount of $33,800. The excess of the
purchase price of the Bonds over the sum of $4,191,200 will be credited to the debt service fund
for the Bonds for the purpose of paying interest first coming due on the additional Bonds. The
Bonds will be issued, sold and delivered in accordance with the terms of the following Terms of
Proposal:
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THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE
TillS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE
FOLLOWING BASIS:
TERMS OF PROPOSAL
$4,225,000
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2004A
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, April 6, 2004, until 12:00 Noon, Central
Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul,
Minnesota, after which time they will be opened and tabulated. Consideration for award of the
Bonds will be by the City Council at 7:00 P.M., Central Time, of the same day,
SUBMISSION OF PROPOSALS
Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the
time of sale specified above. All bidders are advised that each Proposal shall be deemed to
constitute a contract between the bidder and the City to purchase the Bonds regardless of the
manner in which the Proposal is submitted.
(a) Sealed Biddinf(. 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.
OR
(b) Electronic Biddinf(. 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 P ARITJ:*W 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 P ARITY@. The City is using the services of P ARITY@ solely as a
communication mechanism to conduct the electronic bidding for the Bonds, and P ARITY@ is not
an agent ofthe City.
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If any provisions of this Terms of Proposal conflict with information provided by P ARITY@, this
Terms of Proposal shall control. Further information about P ARITY@, including any fee
charged, may be obtained from:
PARlTY@, 40 West 23rd Street, 5th Floor, New York City, New York 10010, Customer
Support, (212) 404-8102.
DETAILS OF THE BONDS
The Bonds will be dated May 1,2004, as the date of original issue, and will bear interest payable
on February 1 and August 1 of each year, commencing February 1, 2005. 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:
2006 $185,000 2011 $185,000 2016 $95,000 2021 $90,000
2007 $510,000 2012 $285,000 2017 $95,000 2022 $90,000
2008 $495,000 2013 $280,000 2018 $95,000 2023 $90,000
2009 $480,000 2014 $275,000 2019 $95,000 2024 $90,000
2010 $420,000 2015 $195,000 2020 $90,000 2025 $85,000
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds. All term bonds shall be subject to mandatory sinking fund redemption
and must conform to the maturity schedule set forth above at a price of par plus accrued interest
to the date of redemption. In order to designate term bonds, the proposal must specify "Years of
Term Maturities" in the spaces provided on the Proposal Form.
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public. The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"),
New York, New York, which will act as securities depository of the Bonds. Individual
purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof
of a single maturity through book entries made on the books and records of DTC and its
participants. Principal and interest are payable by the registrar to DTC or its nominee as
registered owner of the Bonds. Transfer of principal and interest payments to participants of
DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial
owners by participants will be the responsibility of such participants and other nominees of
beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to
deposit the Bonds with DTC.
REGISTRAR
The City will name the registrar that shall be subject to applicable SEC regulations. The City
will pay for the services of the registrar.
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OPTIONAL REDEMPTION
The City may elect on February 1,2014, and on any day thereafter, to prepay Bonds due on or
after February 1, 2015. 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 a price of par plus accrued interest.
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. In addition the City will pledge special
assessments against benefited property. The proceeds will be used to finance various
improvement projects within the City.
TYPE OF PROPOSALS
Proposals shall be for not less than $4,191,200 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 $42,250, 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
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interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling.
The City will reserve the right to: (i) waive non-substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals
without cause, and (iii) reject any proposal that the City determines to have failed to comply with
the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of the
Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of insurance
shall be paid by the purchaser, except that, if the City has requested and received a rating on the
Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall
be the responsibility of the purchaser.
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds.
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser.
SETTLEMENT
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser through DTC in New York, New York. Delivery will be subject to receipt by the
purchaser of an approving legal opinion of Kennedy & Graven, Chartered of 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
In accordance with SEC Rule 15c2-12(b)(5), the City will undertake, pursuant to the resolution
awarding sale of the Bonds, to provide annual reports and notices of certain events. A
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description of this undertaking is set forth in the Official Statement. The purchaser's obligation
to purchase the Bonds will be conditioned upon receiving evidence of this undertaking at or prior
to delivery of the Bonds.
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, 85 East Seventh Place,
Suite 100, Saint Paul, Minnesota 55101, telephone (651) 223-3000.
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any underwriter
or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than
seven business days after the date of such award, it shall provide without cost to the senior
managing underwriter of the syndicate to which the Bonds are awarded 170 copies of the
Official Statement and the addendum or addenda described above. The City designates the
senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for
purposes of distributing copies of the Final Official Statement to each Participating Underwriter.
Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its
proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a
contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring
the receipt by each such Participating Underwriter of the Final Official Statement.
Dated March 1, 2004 BY ORDER OF THE CITY COUNCIL
/s/ Judith Cox
City Clerk
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3. Springsted Incorporated is authorized and directed to negotiate the Bonds in
accordance with the foregoing Terms of Proposal. The City Council will meet at 7:00 o'clock
P.M. on Tuesday, April 6, 2004, to consider proposals on the Bonds and take any other
appropriate action with respect to the Bonds.
The motion for the adoption of the foregoing resolution was duly seconded by
Coullcilmember , and upon vote being taken thereon the following members
voted in favor of the motion:
and the following voted against:
. whereupon the resolution was declared duly passed and adopted.
Adopted in regular session this 1 st day of March, 2004.
Mayor of the City of Shakopee
ATTEST:
City Clerk
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Extract of Minutes of Meeting
of the City Council of the City
of Shakopee, Scott County, Minnesota
Pursuant to due call and notice thereof a regular meeting of the City Council of the City
of Shakopee, Scott County, Minnesota, was held at the City Hall in the City on Monday, March
1,2004, commencing at 7:00 o'clock P.M.
The following members of the Council were present:
and the following were absent:
*** *** ***
The following resolution was presented by Councilmember who moved
its adoption:
RESOLUTION NO. 6019
RESOLUTION PROVIDING FOR THE ISSUANCE
AND SALE OF $2,280,000 GENERAL OBLIGATION
BUILDING REFUNDING BONDS, SERIES 2004B
BE IT RESOLVED By the City Council of the City of Shakopee, Scott County,
Minnesota (City) as follows:
1. It is hereby determined that:
(a) the City is authorized by the provisions of Minnesota Statutes,
Chapter 475 (Act) and Section 475.67, Subdivision 13 of the Act to issue and sell its
general obligation bonds to refund outstanding bonds when determined by the City
Council to be necessary and desirable;
I
(b) it is necessary and desirable that the City issue $2,280,000 General
Obligation Building Refunding Bonds, Series 2004B (Bonds) to refund in advance of
maturity and at their redemption date, certain outstanding general obligations of the City;
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(c) the outstanding bonds to be refunded (Refunded Bonds) consist of
the $3,140,000 General Obligation Building Bonds, Series 1997A, dated June 1, 1997, of
which $2,190,000 in principal amount is callable on February 1, 2005.
2. To provide monies to refund in advance of maturity the Refunded Bonds, the City
will therefor issue and sell Bonds in the amount of $2,257,770. In order to provide in part the
additional interest required to market the Bonds at this time, additional Bonds will be issued in
the amount of $22,230. The excess of the purchase price of the Bonds over the sum of
$2,257,770 will be credited to the debt service fund for the Bonds for the purpose of paying
interest fIrst coming due on such additional Bonds. The Bonds will be issued, sold and delivered
in accordance with the terms and conditions of the following Official Terms Proposal:
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THE CITY HAS AUTHORIZED SPRINGS TED INCORPORATED TO NEGOTIATE
TillS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE
FOLLOWING BASIS:
TERMS OF PROPOSAL
$2,280,000*
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION BUILDING REFUNDING BONDS, SERIES 2004B
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, April 6, 2004, until 12:00 Noon, Central
Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul,
Minnesota, after which time they will be opened and tabulated. Consideration for award of the
Bonds will be by the City Council at 7:00 P.M., Central Time, of the same day.
SUBMISSION OF PROPOSALS
Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the
time of sale specified above. All bidders are advised that each Proposal shall be deemed to
constitute a contract between the bidder and the City to purchase the Bonds regardless of the
manner in which the Proposal is submitted.
(a) Sealed Biddinf(. 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.
OR
(b) Electronic Biddinf(. Notice is hereby given that electronic proposals will be received via
P ARlTY@. For purposes of the electronic bidding process, the time as maintained by P ARlTY@
shall constitute the official time with respect to all Bids submitted to PARlTY@. Each bidder
shall be solely responsible for making necessary arrangements to access P ARITyID for purposes
of submitting its electronic Bid in a timely manner and in compliance with the requirements of
~~~~~~~~~~~~~~~~~~m
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
PARlTY@ 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 PARlTY@. The City is using the services of PARITY@> solely as a
communication mechanism to conduct the electronic bidding for the Bonds, and P ARlTY@> is not
an agent of the City.
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If any provisions of this Terms of Proposal conflict with information provided by P ARlTY@, this
Terms of Proposal shall control. Further information about P ARlTY@, including any fee
charged, may be obtained from:
PARlTY@, 40 West 23rd Street, 5th Floor, New York City, New York 10010, Customer
Support, (212) 404-8102.
DETAILS OF THE BONDS
The Bonds will be dated May 1, 2004, as the date of original issue, and will bear interest payable
on February 1 and August 1 of each year, commencing February 1, 2005. Interest will be
computed on the basis ofa 360-day year of twelve 30-day months.
The Bonds will mature February 1 in the years and amounts as follows:
2006 $165,000 2009 $175,000 2012 $190,000 2015 $215,000
2007 $165,000 2010 $180,000 2013 $195,000 2016 $220,000
2008 $165,000 2011 $185,000 2014 $200,000 2017 $225,000
* The City reserves the right, after proposals are opened and prior to award, to increase or reduce the principal
amount of the Bonds offeredfor sale. Any such increase or reduction will be made in multiples of$5,000 in any
of the maturities. In the event the principal amount of the Bonds is increased or reduced, any premium offered
or any discount taken by the successful bidder will be increased or reduced by a percentage equal to the
percentage by which the principal amount of the Bonds is increased or reduced
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds. All term bonds shall be subject to mandatory sinking fund redemption
and must conform to the maturity schedule set forth above at a price of par plus accrued interest
to the date of redemption. In order to designate term bonds, the proposal must specify "Years of
Term Maturities" in the spaces provided on the Proposal Form.
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public. The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"),
New York, New York, which will act as securities depository of the Bonds. Individual
purchases of the Bonds may be made in the principal amount of $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.
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REGISTRAR
The City will name the registrar that shall be subject to applicable SEC regulations. The City
will pay for the services ofthe registrar.
OPTIONAL REDEMPTION
The City may elect on February 1,2014, and on any day thereafter, to prepay Bonds due on or
after February 1,2015. Redemption may be in whole or in part and if in part at the option of the
City and in such manner as the City shall determine. If less than all Bonds of a maturity are
called for redemption, the City will notify DTC of the particular amount of such maturity to be
prepaid_ DTC will determine by lot the amount of each participant's interest in such maturity to
be redeemed and each participant will then select by lot the beneficial ownership interests in
such maturity to be redeemed. All prepayments shall be at a price of par plus accrued interest.
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. The proceeds will be used to refund
the February 1, 2006 through February 1, 2017 maturities of the City's General Obligation
Building Bonds, Series 1997A, dated June 1, 1997.
TYPE OF PROPOSALS
Proposals shall be for not less than $2,257,770 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 $22,800, 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.
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AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling.
The City will reserve the right to: (i) waive non-substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals
without cause, and (iii) reject any proposal that the City determines to have failed to comply with
the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of the
Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of insurance
shall be paid by the purchaser, except that, if the City has requested and received a rating on the
Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall
be the responsibility of the purchaser.
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds.
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser.
SETTLEMENT
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser through DTC in New York, New York. Delivery will be subject to receipt by the
purchaser of an approving legal opinion of Kennedy & Graven, Chartered of 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.
SJB-244453vl
SH155-142
,
CONTINUING DISCLOSURE
In accordance with SEC Rule 15c2-12(b)(5), the City will undertake, pursuant to the resolution
awarding sale of the Bonds, to provide annual reports and notices of certain events. A
description of this undertaking is set forth in the Official Statement. The purchaser's obligation
to purchase the Bonds will be conditioned upon receiving evidence of this undertaking at or prior
to delivery of the Bonds.
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, 85 East Seventh Place,
Suite 100, Saint Paul, Minnesota 55101, telephone (651) 223-3000.
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any underwriter
or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than
seven business days after the date of such award, it shall provide without cost to the senior
managing underwriter of the syndicate to which the Bonds are awarded 90 copies of the Official
Statement and the addendum or addenda described above. The City designates the senior
managing underwriter of the syndicate to which the Bonds are awarded as its agent for purposes
of distributing copies of the Final Official Statement to each Participating Underwriter. Any
underwriter delivering a proposal with respect to the Bonds agrees thereby that if its proposal is
accepted by the City (i) it shall accept such designation and (ii) it shall enter into a contractual
relationship with all Participating Underwriters ofthe Bonds for purposes of assuring the receipt
by each such Participating Underwriter ofthe Final Official Statement.
Dated March 1, 2004 BY ORDER OF THE CITY COUNCIL
/s/ Judith Cox
City Clerk
SJB-244453vl
SH155-142
3. Springsted Incorporated is authorized and directed to negotiate the Bonds in
accordance with the foregoing Terms of Proposal. The City Council will meet at 7:00 o'clock
P.M. on Tuesday, April 6, 2004~ to consider proposals on the Bonds and take any other
appropriate action with respect to the Bonds.
The motion for the adoption of the foregoing resolution was du1y seconded by
Councilmember , and upon vote being taken thereon the following members
voted in favor of the motion:
and the following voted against:
whereupon the resolution was declared duly passed and adopted.
Adopted in regular session held this 1 st day of March, 2004
Mayor of the City of Shakopee
ATTEST:
City Clerk
SJB-244453vl
SH155-142
15. F. 5.
85 SEVENTH PLACE EAST, SUITE 100
SAINT PAUL, MN 55101-2887
651. 223.3000 FAX: 651. 22 3. 3002 f\ t"', ~, ~ f1~
f E-MAIL: advisors@springsted.com .' .U\"~~;)
~\ ,'~ ,~~';t. .,
U",' \Jl
SPRINGSTED
Advisors to tbe Public Sector
$
February 26, 2004
Mr. Gregg Voxland, Finance Director
City of Shakopee
129 Holmes Street South
Shakopee, MN 55379-1376
Re: Recommendations for the Issuance of:
$4,225,000 General Obligation Improvement Bonds, Series 2004A
$2,280,000 General Obligation Building Refunding Bonds, Series 2004B
Dear Mr. Voxland:
We have enclosed a copy of our recommendations for the above-captioned issues for
distribution to Council members and City staff prior to your meeting on Monday, March 1, 2004.
We have also enclosed a contract amendment for services relating to continuing disclosure to
include these issues. If the City wishes to continue to engage Springsted for this service for the
new issues, please sign the amendment and return it to us.
If you should have any questions pertaining to the enclosed documents, or if you require
additional copies, please do not hesitate to contact us.
Sincerely,
(Jj)~ /J7 4Is
h,/.4 '(fv--<..r
Christine M. Hogan
Project Manager
kem
Enclosures
CORPORATE OFFICE: SAINT PAUL, MN . Visit our website at www.springsted.com
IOWA . KANSAS .. MINNESOTA . VIRGINIA . WASHINGTON, DC . WISCONSIN
Recommendations
For
City of Shakopee, Minnesota
$4,225,000
General Obligation Improvement Bonds, Series 2004A
$2,280,000
General Obligation Building Refunding Bonds, Series 2004B
Presented to:
Mayor John Schmitt
Members, City Council
Mr. Mark McNeill, City Administrator
Mr. Gregg Voxland, Finance Director
City of Shakopee
129 Holmes Street South
Shakopee, MN 55379-1376
SPRINGSTED
Study No.: S0750Q4R4 ~ Ad';,"n '" ,h, M1;, S",,,
SPRINGSTED Incorporated
February 26, 2004
RECOMMENDATIONS
Re: Recommendations for the Issuance of:
$4,225,000 General Obligation Improvement Bonds, Series 2004A
(the "Series 2004A Bonds")
$2,280,000 General Obligation Building Refunding Bonds, Series 2004B
(the "Series 2004B Bonds")
(collectively referred to as the "Bonds" or the "Issues")
We respectfully request your consideration of our recommendations for the above-named
Issues.
We recommend the following for the Bonds:
1. Action Requested To establish the date and time of receiving
bids and establish the terms and conditions
of the offerings.
2. Sale Date and Time Tuesday, April 6, 2004, at 12:00 Noon with
award by the City Council at 7:00 P.M. that
same evening.
3. Method of Sale The Bonds will be sold through a competitive
bidding process. In the interest of obtaining
as many bids as possible, we have included
a provision for underwriters to submit their
bids electronically through the electronic
bidding platform of PARITY@. In addition,
physical bids (by phone or fax) will be
accepted at the offices of Springsted.
4. Authority for the Bonds The Bonds are being issued pursuant to
Minnesota Statutes, Chapter 475. In
addition, the Series 2004A Bonds are also
being issued pursuant to Minnesota
Statutes, Chapter 429.
5. Principal Amount of the Bonds Series 2004A Bonds - $4,225,000
Series 2004B Bonds - $2,280,000
Included in the attached Terms of Proposal
for the Series 2004B Bonds is a provision
that permits the City to increase or reduce
the principal amount of the Series 2004B
Bonds in any of the maturities. This will
allow for any necessary adjustments based
on final costs and the amount required to
fund the escrow account.
6. Repayment Term The Series 2004A Bonds will mature
annually February 1, 2006 through 2025.
Interest will be payable semi-annually each
February 1 and August 1, commencing
February 1 , 2005_
City of Shakopee, Minnesota
February 26, 2004
The Series 2004B Bonds will mature
annually February 1, 2006 through 2017.
Interest will be payable semi-annually each
February 1 and August 1, commencing
February 1, 2005.
7. Term Bonds We have included a provision on the Bonds
that permits the underwriters to combine
multiple maturity years into a single term
bond, subject to mandatory redemption on
the same maturity schedule provided in the
Terms of Proposal. The advantage to the
underwriter is that it provides large blocks of
bonds, which are more attractive to bond
funds, and certain pension funds, which deal
only with large blocks of bonds. This in turn
is a benefit to the City since selllng larger
blocks of bonds reduces the risk to the
underwriter, allowing them to lower their
costs and the interest coupons. Since the
Bonds are being offered on a competitive bid
basis and awarded on the lowest true
interest cost, the City will award the Bonds to
the best bid regardless of whether or not
term bonds are chosen.
8. Security and Source of Payment
(a) Security The Bonds will be general obligations of the
City.
(b) Source of Payment The Series 2004A Bonds will be repaid with
the collection of special assessments. The
interest payment due on February 1,2005
will be made with capitalized interest
included in the par amount of the Bonds.
The Series 2004B Bonds will be repaid from
general ad valorem tax levies. The escrow
established with the proceeds of the Series
2004B Bonds will be used to pay the interest
payments due on the Series 2004B Bonds
through the first call date on the Series
1997 A Bonds.
9. Prepayment Provisions For both series of Bonds, the City may eject
on February 1, 2014, and on any day
thereafter, to prepay Bonds due on or after
February 1, 2015 at a price of par plus
accrued interest.
10. Credit Rating Comments An application will be made to Moody's
Investors Service for a rating for the Bonds.
The City's current credit rating on its general
obligation debt is "A 1."
Page 2
City of Shakopee, Minnesota
February 26, 2004
11. Federal Treasury Regulations Concerning
Tax-Exempt Obligations
(a) Bank Qualification Under Federal Tax Law, financial institutions
cannot deduct from income for federal
income tax purposes, expense that is
allocable to carrying and acquiring tax-
exempt bonds. There is an exemption to
this for "bank-qualified" bonds, which can be
so designated if the issuer does not issue
more than $10 million of tax-exempt bonds
in a calendar year. Issues that are bank-
qualified typically receive slightly lower
interest rates than issues that are not bank-
qualified. It is our understanding the City
expects to issue more than $10 million of
tax-exempt obligations in 2004, therefore
these Issues are designated as not bank
qualified.
(b) Rebate Requirements All tax-exempt issues are subject to the
federal rebate requirements, which require
all excess earnings created by the financing
to be rebated to the U.S. Treasury. The
requirements generally cover two
categories: bond proceeds and debt service
funds. There are exemptions from rebate
that may apply in both of these categories.
Bond proceeds deposited to a
project/construction fund may qualify for
exemption from rebate if the proceeds are
spent in accordance with the 6-month, 18-
month, or 24-month spending exception.
Both the 18-month and the 24-month
spending exception require a certain
percentage of the proceeds be spent at six-
month intervals. If the City meets one of the
applicable spending exceptions, they may
retain the interest earnings.
The Series 2004A Bonds - the City
anticipates meeting one of the expenditure
exceptions and will therefore qualify for
exemption to rebate.
The Series 2004B Bonds - the proceeds of
the Series 2004B Bonds will be placed in an
escrow account and invested in a yield no
greater than the yield on the Series 2004B
Bonds. Therefore no arbitrage will be
earned.
Page 3
City of Shakopee, Minnesota
February 26, 2004
(c) Bona Fide Debt Service Fund The City must maintain a bona fide debt
service fund for the Bonds or be subject to
yield restriction. A bona fide debt service
fund is a fund for which there is an equal
matching of revenue to debt service
expense, with a carry-over permitted equal
to the greater of the investment earnings in
the fund during the prior year or 1/12 of the
debt service of the prior year.
Additional diligence should be exercised in
monitoring the debt service fund for the
Series 2004A Bonds due to the potential
accumulation of prepayment of special
assessments, which could cause the fund to
become non-bona fide.
(d) Federal Reimbursement Federal reimbursement regulations require
Regulations the City to make a declaration, within 60
days of the actual payment, of its intent to
reimburse itself from expenses paid prior to
the receipt of Bond proceeds. It is our
understanding the City has taken whatever
actions are necessary to comply with the
federal reimbursement regulations in
regards to the Series 2004A Bonds.
(e) Economic Life The average life of the Bonds cannot
exceed 120% of the economic life of the
projects to be financed.
The Series 2004A Bonds - the economic life
of the improvements exceeds 20 years. The
average life of the Bonds is 7.988 years;
therefore the Series 2004A Bonds are within
the economic life requirements.
The Series 2004B Bonds - since the final
term of the Series 2004B Bonds does not
extend beyond that of the original issue, the
Series 2004B Bonds are within the
economic life requirements.
12. Continuing Disclosure The Bonds are subject to the continuing
disclosure requirements. The SEC rules
require the City to undertake an annual
update of its Official Statement information
and report any material events to the
national repositories. Springsted currently
provides continuing disclosure services for
the City under separate contract. An
amendment to that contract adding this
Issue has been provided to City staff.
Page 4
City of Shakopee, Minnesota
February 26, 2004
13. Attachments Series 2004A Bonds
- Sources and Uses Schedule
- Assessment Income Schedules
- Debt Service Schedule
Series 2004B Bonds
- Refunding Schedules
Terms of Proposal
DISCUSSION
Series 2004A Bonds
The proceeds of the Series 2004A Bonds will be used to finance three improvement projects
within the City including the Valley View/Greenfield project, the Vierling Drive/CR 15 East
project, and the West Dean Lake project. As shown in the sources and uses of funds on page
8, the City is contributing cash from various City funds that are being used to reduce the
borrowing amount. In addition, the City is also expecting to receive $250,000 of assessmel1t
prepayments on the Valley View/Greenfield project that is also being used to reduce the
borrowing amount. Since revenue from assessments will not be available to make the
February 1, 2005 interest payment, capitalized interest has been included in the principal
amount of the Series 2004A Bonds.
All assessments will be filed on or about October 1, 2004. Assessments will be spread over
terms of 1 0 and 20 years with even annual principal payments and interest charged on the
unpaid balance at a rate of approximately 1.5% above the True Interest Rate (TIC) on the
Series 2004A Bonds. For structuring purposes we have assumed a rate of 4.90% on the
assessments.
Of the total $4,297,173 of assessments, collections on $687,173 will be deferred under the
Minnesota Green Acres law. Under the Green Acres law, eligible properties do not repay any
assessment amounts (including interest) until such time as they loose their Green Acres status
(usually do the development of agricultural property). Interest on the deferred Green Acres
assessments accrues annually but is not paid until the property is no longer eligible for the
decrement; the accrued interest is added to the original principal amount of the assessment
and reamortized over the remaining assessment term. City staff has directed that we make
certain assumptions regarding the future collection of the deferred Green Acres assessments,
as discussed in greater detail below.
In addition, City staff has also directed that we include certain assumptions regarding the
prepayments on assessments on the Valley View/Greenfield project and the West Dean Lake
project. Those are also discussed in greater detail below. Page 9 shows the total projection of
future assessment collections based on the assumptions regarding the future collection of
deferred assessments and prepayments.
The following is a discussion of the projection of assessment collections by project:
. Valley View/Greenfield project: 50% of the assessments totaling $250,000 are expected
to be prepaid in the fall of 2004. The remaining assessments totaling $250,000 will be
deferred under the Minnesota Green Acres law. For structuring purposes we were
instructed to assume the deferred assessments will be collected in the years 2011
through 2014.
Page 5
City of Shakopee, Minnesota
February 26, 2004 ~
. Vierling DrivelCR 15 East project: 50% of the assessments will be deferred under the
Minnesota Green Acres law. For structuring purposes we were instructed to assume the
deferred assessments will be collected in the years 2010 through 2013. City staff expects
30%, or $150,000 of the principal amount of the assessments to be prepaid evenly in
collection years 2006 through 2008. The remaining 20% of the original principal amount
of the assessments are anticipated to be collected in even annual installments of principal
over the full 10 year term of the assessments.
. West Dean Lake project: City staff expects 40%, or $1,344,000 of the principal amount of
the assessments to be prepaid evenly in collection years 2006 through 2009. The
remaining 60% of the original principal amount of the assessments are anticipated to be
collected in even annual installments of principal over the full 20 year term of the
assessments.
The Series 2004A Bonds have been structured around the anticipated assessment income
receipts developed on pages 9 through 13 for a term of 20 years. Page 14 contains the
following information:
. Columns 1 through 4 show the annual principal, estimated interest rates and projected
total principal and interest payments on the Series 2004A Bonds, given the current market
environment.
. Columns 5 shows the capitalized interest needed to pay the February 1, 2005 interest
payment.
. Column 6 shows the net debt service requirement.
. Column 7 shows the 5% overlevy which is required by State statutes and serves as a
protection to bondholders and the City in the event of delinquencies in the collection of
assessments.
. Column 8 shows the total projected assessment income developed on pages 9 through
13.
. Column 9 shows the projected annual surplus of assessment income for the Series 2004A
Bonds, which represents the difference between the projected assessment income and
105% of debt service.
As long as the City receives prepayments of special assessments and collects the deferred
Green Acres assessments as projected, the City will not be required to levy ad valorem taxes to
pay debt service on the Series 2004A Bonds.
Series 2004B Bonds
The proceeds of the Series 2004B Bonds will be used to refund the February 1, 2006 through
2017 maturities of the City's General Obligation Building Bonds, Series 1997 A (the "Series
1997 A Bonds"), dated June 1, 1997. This refunding is being undertaken to allow the City to
take advantage of lower interest rates and achieve interest cost savings.
The issuance of the Series 2004B Bonds is being conducted as a crossover refunding, in which
the proceeds of the Series 2004B Bonds (new issue) are placed in an escrow account with a
major bank and invested in government securities. These securities and their earnings are
structured to pay interest on the new Series 2004B Bonds until the first optional prepayment
Page 6
City of Shakopee, Minnesota
February 26, 2004
date (call date) of the Series 1997A Bonds (old issue), at which time the escrow account will
crossover and prepay all of the remaining principal of the Series 1997 A Bonds. The City will
continue to pay the originally scheduled debt service on the Series 1997 A Bonds through the
call date of February 1, 2005. After the call date, the City will cross over and begin making debt
service payments on the new Series 2004B Bonds, taking advantage of the lower interest rates.
The proceeds of the Series 1997 A Bonds were used to finance the acquisition, construction and
equipping of a new fire station.
Based on current interest rate estimates, the refunding is projected to result in the City realizing
cash flow savings that will average approximately $20,500 annually. This results in future value
savings of approximately $249,000, with a net present value benefit to the City of approximately
$202,600. These estimates are net of all costs of issuance associated with the Series 2004B
Bonds.
We have attached a set of schedules that summarize the refunding statistics and the projected
savings resulting from the sale of the Series 2004B Bonds. These schedules include the
following information about the Series 2004B Bonds:
. Preliminary Feasibility Summary: indicates the sizing of the Series 2004B Bonds, savings
data and bond data - page 15
. Prior Original Debt Service: shows the existing debt service requirements on the Series
1 997 A Bonds without a refunding - page 16
. Debt Service to Maturity and to Call: shows the Series 1997A Bonds' remaining debt
service to maturity and to the call date, indicating the prepayment requirements of the
Series 1997 A Bonds - page 17
. Debt Service Schedule: shows the new projected debt service on the Series 2004B
Bonds, based on current estimated interest rates - page 18
. Debt Service Comparison: shows the debt service comparison and the projected annual
cash flow savings of the Series 2004B Bonds to the Series 1997 A Bonds - page 19
The success of a refunding transaction is dependent upon the interest rate market. We will
continue to monitor this transaction between now and the time the Series 2004B Bonds are
offered for sale.
We appreciate again being of service to the City of Shakopee.
Respectfully submitted,
/~~
SPRINGSTED Incorporated
kem
Provided to Staff: Contract Amendment for Continuing Disclosure
Page 7
$4,225,000
City of Shakopee, Minnesota
General Obligation Improvement Bonds
Series 2004A
Sources & Uses
Dated 05/01/2004 I Delivered 05/01/2004
SOURCES OF FUNDS
Par Amount of Bonds................. ....... ....................................................................................................................... .......... $4,225,000.00
Prepaid Assessments... ............................... .......................................................................................-................ .............. 275,000.00
State Aid... ............................. ......................................................................................................................................... ... 275,000.00
Storm Fund............... .... .................... .......... ........................................................................... .................. .......................... 200,000.00
Water Fund............... .... ..... ..........................................................................................................................-.................... 9,000.00
TOT AL SOURCES............................................................................................................................................................ $4,984,000.00
USES OF FUNDS
West Dean Lake Project... .................................. ..... .................................,................................... .... ...... .................... ....... 3.317.183.25
VierlinglCR 15 East... .......... ................. ........................ ..................................... ..........................; .., ...... ....... .................. ... 847,830.00
Valley View/Greenfield..................... ................... ................. ,......... ........... ......... ..................... ...... ........... ........... ............... 666,933.00
Deposit to Capitalized Interest (CIF) Fund......................................................................................................................... 89.332.50
Total Underwriter's Discount (0.800%).......".,.,.................,.. ............. .... ..................... ..... ....... .......,... .., ..... ............. .......... 33,800.00
Costs of Issuance........ ............................................................... .................................................................................. ..... 29.675.00
Rounding Amount....,......,..,.......... ... ..., ... .... ............. ...,.., ............, .,. ...... ..... .......... .........,. .............. ....... ..... ... ........ ...........-.. (753.75)
TOT AL USES.................................................................................................................................................................... $4,984,000.00
smeszoo#' I ViorJin&S8kfx>17 I Z/Z6/Z004 I 8:94AM
I~SPRING>"rnD I
.iJm~rlI'l. :t.,.~$m'# Page 8
City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004A
TOTAL PROJECTED ASSESSMENT INCOME
DATE Valley View Vierling CR 15 West Dean Lake Vierling TOTAL
Assessment East Assessments Assessments
(Green Acres) Assessments (Green Acres)
12/31/2005 - 25,312.50 306,600.00 - 331,912.50
12/31/2006 . 71,760.00 596,500.80 - 668,260.80
12/31/2007 - 68,820.00 575,097.60 - 643,917.60
12/31/2008 - 65,880.00 553,694.40 . 619,574.40
12/31/2009 - 12,940.00 532,291.20 . 545,231.20
12/3112010 - 12,450.00 174.888.00 95,745.78 283,083.78
12/31/2011 109,718.70 11,960.00 169,948.80 91,823.08 383,450.58
12/31/2012 105,223.54 11,470.00 165,009.60 87,900.40 369,603.54
12/31/2013 100,728.38 10,980.00 160,070.40 83,977.70 355,756.48
12/31/2014 96,234.22 10,490.00 155,131.20 - 261,855.42
12/31/2015 - - 150.192.00 - 150,192.00
12/31/2016 - - 145,252.80 - 145,252.80
12/31/2017 - - 140,313.60 - 140,313.60
12/31/2018 . - 135,374.40 - 135,374.40
12/31/2019 - . 130,435.20 - 130,435.20
12/31/2020 - - 125,496.00 - 125,496.00
12/31/2021 - - 120,556.80 - 120,556.80
12/31/2022 - - 115,617.60 - 115,617.60
12/31/2023 - - 110,678.40 - 110,678.40
12/3112024 - - 105,739.20 - 105,739.20
T olal $411,904.84 $302,062.50 $4,668,888.00 $359,446.96 $5,742,302.30
Valley View Assessments (Green Acres) 366,953.00
Vierling CR 15 East Assessments 250,000.00
West Dean Lake Assessments 3,360,000.00
Vierling CR 15 East (Green Acres) Assessments 320,220.00
TOTAL........................................................................................................................................................................................ 4,297,173.00
~^' / 2/26/2004 / 8:38AM
I$"RD<C~D I
. _.~--
Page 9
$366,953
City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004A
2004A Assessments - Valley View
ASSESSMENT INCOME
Date Principal Coupon Interest Total P+I
12/31/2010 - - - -
12/3112011 91,738.00 4.900% 17,980.70 109,718.70
12/31/2012 91,738.00 4.900% 13,485.54 105,223.54
12/31/2013 91,738.00 4.900% 8,990.38 100,728.38
12/31/2014 91,739.00 4.900% 4,495.22 96,234.22
Total $366,953.00 - $44,951.84 $411,904.84
SIGNIFICANT DATES
Filing Date............ ...... ..............., ........................ ...... ........... ........... ...... ... ... .... ........................................ ...............-. ....... ....... 12/31/2010
First Payment Date... .......... ..................... ....................... ..................................................................,.......,. ..... ...................... 12/31/2011
2004,( A.rsess1Mnh - VNk / sovaLE I'U1II'OSG I 2/2G/2{)()-I f 8:95.AM
l:JsPRJNGSTlID I
1.~:>I*1\J..'1f<Sutt.~r Page 10
$250,000
City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004A
2004A Assessments - Vierling CR 15 East
ASSESSMENT INCOME
Date Principal Coupon Inte.rest Total P+I
12i31/2004 - - - -
12/31/2005 10,000.00 4.900% 15,312.50 25,312.50
12/31/2006 60,000.00 4.900% 11,760.00 71,760.06
12/31/2007 60,000.00 4.900% 8,820.00 68,820.00
12/31/2008 60,000.00 4.900% 5,880.00 65,880.00
12/31/2009 10,000.00 4.900% 2,940.00 12,940.00
12/31/2010 10,000.00 4.900% 2,450.00 12,450.00
12/31/2011 10,000.00 4.900% 1 ,960.00 11,960.00
12/31/2012 10,000.00 4.900% 1,470.00 11,470.00
12/31/2013 10,000.00 4.900"10 580.00 10,1360.00
12/31/2014 10,000.00 4.900% 490.00 10,490.00
Total $250,000.00 . $52,062.50 $302,062.50
SIGNIFICANT DATES
Filing Date............ ..... ...... ......, .................................... .............' .... ....... ..... .... ............. ........ ...... .,. .............. ........... .................. 1 0101/2004
First Payment Date........... .... ...... ......... ..... ................ .......... ....... ................. .......... ...... ... ............. ............................... ............ 12/31/2005
ZOO4A.A&sesDnenu- Viorll SlNGLEI'lIIll'O$E 1 3/Z6/Z004 18:S5AM
1~~!!i~.21
Page 11
$3,360,000
City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004A
2004A Assessments - West Dean Lake
ASSESSMENT INCOME
Date Principal Coupon Interest Total P+I
12/31/2004 - - - -
12/31'2005 100,800.00 4.900% 205,800.00 306,600.00
12/31/2006 436,800.00 4.900% 159,700.80 596,500.80
12/31/2007 436,800.00 4.900% 138,297.60 575,097.60
12/31/2008 436,800.00 4.900% 116,894.40 553,694.40
12/31/2009 436,800.00 4.900% 95,491.20 532,291.20
12/311201 0 100,800.00 4.900% 74,088.00 174,888.00
12/31/2011 100,800.00 4.900% 69,148.80 169,948.80
12/31/2012 100,800.00 4.900% 64,209.60 165,009.60
12/31/2013 100,800.00 4.900% 59,270040 160,070040
12/31/2014 100,800.00 4.900% 54,331.20 155,131.20
12/31/2015 100,800.00 4.900% 49.392.00 150,192.00
12/31/2016 100,800.00 4.900% 44,452.80 145,252.80
12/31/2017 100,800.00 4.900% 39,513.60 140,313.60
12/31/2018 100,800.00 4.900% 34,574.40 135,374.40
12/31/2019 100,800.00 4.900% 29,635.20 130,435.20
12/31 '2020 100,800.00 4.900% 24,696.00 125,496.00
12/31/2021 100,800.00 4.900% 19,756.80 120,556.80
12/31/2022 100,800.00 4.900% 14,817.60 115,617.60
12/31/2023 100,800.00 4.900% 9,878.40 110,678.40
12/31/2024 100,800.00 4.900% 4,939.20 105,739.20
Total $3,360,000.00 . $1,308,888.00 $4,668,888.00
SIGNIFICANT DATES
Filing Date.... ........ ... .........,............ .................................. ............................................................................ ....................... 10/01/2004
First Payment Date............. ... ................................................................................................................-............................ 12/31/2005
Z004A Assessments - W....j 1 SlNGJ.EPUllPOSE / Z/26/2004 / 8:9$ AM
I~SPRD<~D I
. _.~--
Page 12
$320,220
City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004A
2004A Assessments - Vierling (Green Acres SA)
ASSESSMENT INCOME
Date Principal Coupon Interest Total P+l
12131/2009 ' . - . .
12131/2010 80,055.00 4.900% 15,690.78 95,745.78
12131/2011 80,055.00 4.900"10 11 ,768.08 91,823.08
12131/2012 80,055.00 4.900% 7,845.40 87,900.40
12131/2013 80,055.00 4.900% 3,922.70 . 83,977.70
T otaJ $320,220.00 . $39,226.96 $359,446.96
SIGNIFICANT DATES
Filing Date............ ... .......................................;......;....................... .................................................................... .;....,............. 12131/2009
First Payment Date... ............................................................................ ........................:...........,......... ............................. ...... 12131/2010
2004A As.s=men/s - Vi",,] I SOVGLE I'UllFafE I 2/26/2004 I 8:35AM
I$SPRmGSTED I
. _.~--
Page 13
$4,225,000
City of Shakopee, Minnesota
General Obligation Improvement Bonds
Series 2004A
NET DEBT SERVICE SCHEDULE
Date Principal coupon Interest Total P+I CIF Net New CIS 105% of 10tal Revenue Annual
Surplus
11\ 12\ 13\ 14\ 151 (6\ m (8\ (9\
02101/2005 - - 89.332.50 89,332.50 (89,332.50) - . . .
02101/2006 185,000.00 1.300% 119,110.00 304,110.00 - 304,110.00 319,315.50 331,912.50 12,597.00
02101/2007 510,000.00 1.600% 116,705.00 626,705.00 626,705.00 658,040.25 668,260.80 10,220.55
0210112008 495,000.00 2.000% 108.545.00 603,545,.00 603,545.00 633,722.25 643,917.60 10,195.35
02101/2009 480,000.00 2.300% 98,645.00 578,645.00 . 578,645.00 607,577.25 619,574.40 11,997.15
02/01/2010 420,000.00 2.600% 87,605.00 507,605.00 507,605.00 532,985.25 545,231.20 12,245.95
02101/2011 185,000.00 2.750% 76,685.00 261,685.00 . 261,685.00 274,769.25 283,083.78 8,314.53
02/0112012 285,000.00 3.000% 71,597.50 356,597.50 356,597.50 374,427.38 383,450.58 9,023.21
02/01/2013 280,000.00 3.250% 63,047.50 343,047.50 343,047.50 360,199.88 369,603.54 9,403.67
02101/2014 275.000.00 3.400% 53.947.50 328,947.50 - 328.947.50 345.394.88 355.756.48 10.361.61
02101/2015 195,000.00 3.500% 44,597.50 239,597.50 239,597.50 251,577.38 261,855.42 10,278.05
02/01/2016 95,000.00 3.700% 37,772,50 132,772.50 . 132,772.50 139,411.13 150,192.00 10,780.88
02/01/2017 95,000.00 3.800% 34,257.50 129,257.50 129,257.50 135,720.38 145,252.80 9,532.43
02101/2018 95,000.00 4.000% 30,647.50 125,647.50 . 125,647.50 131,929.88 140,313.60 8,383.73
02101/2019 95,000.00 4.100% 26,847.50 121,847.50 - 121,847.50 127,939.88 135,374.40 7,434.53
0210112020 90,000.00 4.150% 22,952.50 112,952.50 112,952.50 118,600.13 130,435.20 11,835.08
02/01/2021 90,000.00 4.200% 19,217.50 109,217.50 . 109,217.50 114,678.38 125,496.00 10,817.63
02/01/2022 90,000.00 4.250% 15,437.50 105,437.50 . 105,437.50 110,709.38 120,556.80 9,847.43
02/01/2023 90,000.00 4.300% 11,612.50 101,612.50 . 101,612.50 106,693.13 115,617.60 8,924.48
02/0112024 90,000.00 4.400% 7,742.50 97,742.50 . 97.742.50 102,629.63 110,678.40 8,048.78
02/0112025 85,000.00 4.450% 3,782.50 88,782.50 . 88,782.50 93,221.63 105,739.20 12,517.58
Total $4,225,000.00 . $1,140,087.50 $5,365,087.50 (89,332.50) $5,275,755.00 $5,539,542.75 $5,742,302.30 $202,759.55
SIGNIFICANT DATES
Oaled................................................................................................................................................................................................... 5/0112004
Delivery Dale........................................................................................................................................................................................... 5/0112004
Flrsl Coupon Dale..........................................................................................................................................................,'............-............... 2/0112005
Yield Statistics
Bond Year Dollars....................................................................................................................................................................................... $33,748.75
AverageUfe............................................................................................................................................................................................ 7.988 Years
Average Coupon............................................................................ .............................................................................................................. 3.3781622%
Net Interest Cost (NIC) ....................... ..... ........... ........ ......................... ................... ..................................... .................... ............................. 3.4783140%
T rue Interest Cost (TIC) ....... .................... ..................................................................................................................................................... 3.4256099%
Bond Yield for Arbitrage Purposes....................................................................................................................................................................... 3.3071678%
All Inclusive Cost (AIC)................................................................... ...........-................-................................................................................ 3.5308053%
IRS Form 8038
Netlnlerest CosL................................... ................................................................................................ ........................... ....................... 3.3781622"10
Weighled Average Maturity...................................................................:........................................................................................................... 7.988 Years
SdrWZlXHA / Vier/i11sS.te to 11 / 2/26/20fH / /J;;J4AM
~snUNGSfEO I
.~IlY'~tllC rlle;-':~ $O<r':~' Page 14
$2,280,000
City of Shakopee, Minnesota
General Obligation Building Refunding BondS, Series 2004B
Crossover Refunding of Series 1997 A
Preliminary Feasibility Summary
Dated 05101120041 Delivered 0510112004
SOURCES OF FUNDS
Par Amount of Bonds.....................-.............................................................................................................. ........... .......... $2,280,000.00
TOT AL SOURCES.....................................................................................................................,...................................... $2,280,000.00
USES OF FUNDS
Deposit to Crossover Escrow Fund.................................................................................................................................... 2,220,396.59
Costs of Issuance..............................................;............................................................................;... .......... ..................... 35,000.00
Total Underwriter's Discount (0.975%).........................................................................-...........................................-....... 22,230.00
Rounding Amount................................................_................................................;...-...................................... .................. 2,373.41
TOT AL USES.................................................................................................................................................................... $2,280,000.00
ISSUES REFUNDED AND CALL INFORMATION
Prior Issue Call Price....-.................................................................................................................. .................................. 100.000%
Prior Issue Call Dale..... .................................................................................................. ................................................... 2/01/2005
SAVINGS INFORMATION
Net Future Value Benefit.................................................................................................................................................. $249,002.17
Net Present Value Benefit.................................................................................................................................................. $202,560.67
Net PV Benefit 1$2,432,624.36 PV Refunded Debt Service..-........................................................................................... 8.327%
BOND STATISTICS
AverageUfe....~.................................................................................................................................................................. 7.618 Years
Average Coupon................................................................................................................................................................ 3.1965314%
Net Interest Cost (NIC)...................................................................................................................................................... 3.3245107%
True Interest Cost (TIC)..............................................................................................................................-...................... 3.3161096"':'
I The estima/l:d savings resaIfs of the refandirtg IU'e subject to market condiHo118. I
SedelZOtHbI'S'fA I SJNGUl'URPOSE I V,U/ZOQI I 'f:SSAM
~SPRINGSTED
~..,,"lM1WhtS<<t<<
Page 15
$3,140,000
City of Shakopee, Minnesota
General Obligation Building Bonds
Series 1997 A
Prior Original Debt Service
Date Principal Coupon Interest Total P+I
08101/2004 - - 61,293.75 61,293.75
02101/2005 130,000.00 4.900"10 61,293.75 191,293.75
08101/2005 - - 58,108.75 58,108.75
02101/2006 135,000.00 5.000% 58,108.75 193,108.75
08101/2006 . - 54,733.75 54,733.75
02101/2007 140,000.00 5.000% 54,733.75 194,733.75
08101/2007 . . 51,233.75 51,233.75
02101/2008 145,000.00 5.100% 51,233.75 196,233.75
08101/2008 - . 47.536.25 47,536.25
02101/2009 155,000.00 5.200% 47,538.25 202,538.25
08101/2009 - - 43,506.25 43,506.25
02101/2010 165,000.00 5.250"10 43,506.25 208,506.25
0810112010 - - 39,175.00 39,175.00
02101/2011 175,000.00 5.250"/0 39,175.00 214,175.00
08101/2011 . . 34,581.25 34,581.25
02101/2012 185,000.00 5.250% 34,581.25 219,581.25
0810112012 - - 29,725.00 29,725.00
02101/2013 195,000.00 5.375% 29,725.00 224,725.00
08101/2013 - - 24,484.38 24,484.38
02101/2014 205,000.00 5.375% 24,484.38 229,484.38
08101/2014 . - 18,975.00 18,975.00
0210112015 220,000.00 5.500% 18,975.00 . 238,975.00
08101/2015 . - 12,925.00 12,925.00
02101/2016 230,000.00 5.500% 12,925.00 242,925.00
08101/2016 - - 6,600.00 6,600.00
02101/2017 240,000.00 5.500% 6,600.00 246,600~00
T ota! $2,320,000.00 - $965,756.26 $3,285,756.26
YIeld Statistics
Average Ufe.._.................................................................................................................................................................... 7.498 Years
Weighted Average Maturity {Par Basis)....... .... .n............. ..................n... ............................................................................ 7.498 Years
Average Coupon.............................. ......... ............ ...................................................n......... ................................................ 5.3757366%
Refunding Bond information
Refunding Dated Date............................................................................................................................................-........... 5/0112004
Refunding Delivery Date..................................................................................................................................................... 5/01/2004
1111t: estimated ssvirtgs resalfs 01 the mttmding are subjecllo market conditio11S. , I
SoriNI99?A I SINGl&IVRl'OSE I z/ZUZOOI / ?:35AM
$SPRINGSnm
Alb~ ~ u..PatI6r S6br
Page 16
$3,140,000
City of Shakopee, Minnesota
General Obligation Building Bonds
Series 1997 A
Debt Service To Call And To Maturity
Date Refunded Interest to D/S To Call Principal Coupon Interest Refunded D/S
Bonds Can
08101/2004 - 58,108.75 58,108.75 - - 58,108.75 58,108.75
02101/2005 2,190,000.00 58,108.75 2,248,108.75 - 4.900% 58,108.75 58,108.75
08101/2005 - - - - - 58,108.75 58,108.75
02101/2006 - - - 135,000.00 5.000% 58,108.75 193,108.75
08101/2006 - - - - " 54,733.75 54,733.75
02101/2007 - - - 140,000.00 5.000% 54,733.75 194,733.75
08101/2007 - - - - . 51,233.75 51,233.75
02101/2008 - - - 145,000.00 5.100% 51,233.75 196,233.75
08101/2008 - - - - - 47,536.25 47,536.25
02101/2009 . - . 155,000.00 5.200% 47,536.25 202,536.25
08101/2009 - - . . - 43,506.25 43,506.25
02101/2010 - - . 165,000.00 5.250% 43,506.25 208,506.25
08101/2010 - - - - . 39,175.00 39,175.00
02101/2011 - - . 175,000.00 5.250% 39,175.00 214,175.00
08101/2011 - - - - - 34,581.25 34,581.25
02101/2012 . - - 185,000.00 5.250% 34,581.25 219,581.25
08101/2012 - - . - - - 29,725.00 29,725.00
02101/2013 - - - 195,000.00 5.375% 29,725.00 224,725.00
08101/2013 - - - - - 24,484.38 24,484.38
02101/2014 . . - 205,000.00 5.375% 24,484.38 229,484.38
08101/2014 - - - - - 18,975.00 18,975.00
02101/2015 - - - 220,000.00 5.500% 18,975.00 238,975.00
08101/2015 . . - . - 12,925.00 12,925.00
02101/2016 . - - 230,000.00 5.500% 12,925.00 242,925.00
08101/2016 - - - . - 6,600.00 6,600.00
02101/2017 . - - 240,000.00 5.500% 6,600.00 246,600.00
Total $2,190,000.00 $116,217.50 $2,306,217.50 $2,190,000.00 . $959,386.26 $3,149,386.26
Yield Statistics
Average Life........................................................................................................................................................................ 7.898 Years
Weighted Average Maturity (Par Basis)........ ....................................................................-................................................. 7.898 Years
Average Coupon................................................................................. ...... .................. ........................................................ 5.3784182%
Refunding Bond Information
Refunding Dated Date......, .... .......... ....... ......... ..... ... ................................... ....... ........... ........ .............. ................................ 5/01/2004
Refunding Delivery Date.... ................... ............ ... ..................................... ..................... ....... .............................................. 5/01/2004
Ime estimafed saYings rasalls of the refunding 8l'B subject to market conditio]/$. I
SeiUl9fJ7A I IIlNClEFCI1Il'CI6E I Z/Z4/Z00# I 7:35AM
~SPRlNGSTF.D
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Page 17
$2,280,000
City of Shakopee, Minnesota
General Obligation Building Refunding Bonds. Series 2004B
Crossover Refunding of Series 1997 A
Debt Service Schedule
Date Prinoipal Coupon Interest T otel P+I
0210112005 - - 48,697.50 48,697.50
0210112006 165,000.00 1.300% 64,930.00 229,930.00
0210112007 165,000.00 1.600% 62,785.00 227,785.00
0210112008 165,000.00 2.000% 60,145.00 225,145.00
0210112009 175,000.00 2.300% 56,845.00 231 ,845.00
0210112010 180,000.00 2.600% 52,820.00 232,820.00
02/0112011 185,000.00 2.750% 48,140.00 233,140.00
02/0112012 190,000.00 3.000% 43,052.50 233,052.50
0210112013 195,000.00 3.250% 37,352.50 232,352.50
0210112014 200,000.00 3.400% 31,015.00 231,015.00
0210112015 215,000.00 3.500'Yo 24,215.00 239,215.00
0210112016 220,000.00 3.700% 16,690.00 236,690.00
0210112017 225,000.00 3.800% 8,550.00 233,550.00
T ota! $2,280,000.00 . $555,237.50 $2,835,237.50
Yield Statistics
Bond Year Dollars...................................................................... ........................................................................................ $17,370.00
Average Life........... ............................................................................................................................................................ 7.618 Years
Average COupon........~.................................................................................................................................................:....... 3.1965314%
. Net Interest Cost (NIC)................... ..................................................................................................... ............................... 3.3245107%
True Interest Cost (TIC)............................................................................................................ ......................................... 3.3161096%
Bond Yield for Arbitrage Purposes............................................................................................. .......................... ............... 3.1681135%
All Inclusive Cost (AI C)............................................................................... .................................................. ....................... 3.5531583%
IRS Form 8038
Net Interest COSt........................................................ ................... ....................................... .............................................. 3.1965314%
Weighted Average Maturity........................................................................ ..................... ... .................................................. 7.618 Years
I The estimated savings results of the rdunding are subject to mar*et conditions. I
_ZlXJ4Jle1'97A I $/NGLEP1.fJIKJSE I Z/U/ZOO4 / 7:35AM
$Sl.RINGSl'ED
.44f'b:n'a or rJ..t .0000I $,a<<
Page 18
$2,280,000
City of Shakopee, Minnesota
General Obligation Building Refunding Bonds, Series 20048
Crossover Refunding of Series 1997 A
Debt Service Comparison
Date Total P+I Escrow ExIsting DIS Net New DIS Old Net DIS Savings
0210112005 48,697.50 (2,238,697.50) 2,442,587.50 252,587.50 252,587.50 -
02101/2006 229,930.00 - . 229,930.00 251,217.50 21,287.50
0210112007 227,785.00 . - 227,785.00 249,467.50 21,682.50
02101 {2oo8 225,145.00 . . 225,145.00 247,467.50 22,322.50
02/01/2009 231,845.00 - . 231,845.00 250,072.50 18,227.50
02/01/2010 232,820.00 . - 232,820.00 252,012.50 19,192.50
02l01{2011 233,140.00 . . 233,140.00 253,350.00 20,210.00
02l01{2012 233,052.50 - . 233,052.50 254,162.50 21,110.00
02101/2013 232,352.50 - - 232,352.50 254,450.00 22,097.50
0210112014 231,015.00 - - 231,015.00 253,968.76 22,953.16
02101/2015 239,215.00 - . 239,215.00 257,950.00 18,735.00
02101/2016 236,690.00 - . 236,690.00 255,850.00 19,160.00
0210112017 233,550.00 - - 233,550.00 253,200.00 19,650.00
T alai $2,835,237.50 (2,238,697.50) $2,442,587.50 $3,039,127.50 $3,285,756.26 $246,628.76
PV Analysis Summary (Net to Net)
Net FV Cashflow Savings.......................................................................................................................... .......................... 246,628.76
Gross PV Debt Service Savings..........................................................................................................:............. ................... 200,187.26
Net PV Cashflow Savings @ 3.168%(Bond Yield).................................................................................................:............ 200,187.26
Contingency or Rounding Amounl.........................................................,............................................................................ 2,373.41
Net Future Value Benefit...................................................................................................................................................... $249,002.17
Net Present Value Benefil................................................................................................................................................... $202,560.67
Net PV Benefit 1 $714,153.41 PV Refunded Interesl.......................................................................................................... 28.364%
Net PV Benefit 1 $2,432,624.36 PV Refunded Debt Service..................;................................................................:............ 8.327%
Net PV Benefit 1 $2,190,000 Refunded Principal................................................................................................................ 9.249%
Net PV Benefit 1 $2,280,000 Refunding Principal................................................................................................................ 8.884%
Refunding Bond Information
Refunding Dated Date........ .................... ............... ............ ........................................................................ ........................... 510112004
Refunding Delivery Date..................................................... ..................................................................... ............................ 5101/2004
I The estimated Sllvings results of the rdundirlg IIn: subject to m81.fet COl/ditions. I
_ ZlXJ4Jle1'97A 1 SiNGLEP1.fJIKJSE 1 Z/U/ZlXJ4 1 7:S5AM
~SPRINGSTED
~tfd,.AiWJts..'C'HI'
Page 19
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS Will BE RECEIVED ON THE FOllOWING BASIS:
TERMS OF PROPOSAL
$4,225,000
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2004A
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, April 6, 2004, until 12:00 Noon, Central
Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul,
Minnesota, after which time they will be opened and tabulated. Consideration for award of the
Bonds will be by the City Council at 7:00 P.M., Central Time, of the same day.
SUBMISSION OF PROPOSALS
Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the
time of sale specified above. All bidders are advised that each Proposal shall be deemed to
constitute a contract between the bidder and the City to purchase the Bonds regardless of the
manner in which the Proposal is submitted.
(a) Sealed Bidding. Proposals may be submitted in a sealed envelope or by fax
(651) 223-3046 to Springsted. Signed Proposals, without final price or coupons, may be
submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting
to Springsted the final Proposal price and coupons, by telephone (651) 223-3000 or fax
(651) 223-3046 for inclusion in the submitted Proposal.
OR
(b) Electronic Biddina. 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 PARI-ry@. Each bidder
shall be solely responsible for making necessary arrangements to access PARIT~ 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@ SOI~ as a
communication mechanism to conduct the electronic bidding for the Bonds, and PARIT 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@, 40 West 23rd Street, 5th Floor, New York City, New York 10010, Customer
Support, (212) 404-8102.
Page 20
DETAILS OF THE BONDS
The Bonds will be dated May 1, 2004, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing February 1, 2005. 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:
2006 $185,000 2011 $185,000 2016 $95,000 2021 $90,000
2007 $510,000 2012 $285,000 2017 $95.000 2022 $90,000
2008 $495,000 2013 $280,000 2018 $95,000 2023 $90,000
2009 $480,000 2014 $275,000 2019 $95,000 2024 $90.000
2010 $420,000 2015 $195,000 2020 $90,000 2025 $85,000
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds. All term bonds shall be subject to mandatory sinking fund redemption
and must conform to the maturity schedule set forth above at a price of par plus accrued
interest to the date of redemption. In order to designate term bonds, the proposal must specify
"Years of Term Maturities" in the spaces provided on the Proposal Form.
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public. The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
registered in the name of Cede & Co. as nominee of The Depository Trust Company (nDTcn),
New York, New York, which will act as securities depository of the Bonds. Individual purchases
of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single
maturity through book entries made on the books and records of DTC and its participants.
Principal and interest are payable by the registrar to DTC or its nominee as registered owner of
the Bonds. Transfer of principal and interest payments to participants of DTC will be the
responsibility of DTC; transfer of principal and interest payments to beneficial owners by
participants will be the responsibility of such participants and other nominees of beneficial
owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the
Bonds with DTC.
REGISTRAR
The City will name the registrar that 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, 2014, and on any day thereafter, to prepay Bonds due on or
after February 1, 2015. 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 a price of par plus accrued interest.
Page 21
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. In addition the City will pledge special
assessments against benefited property. The proceeds will be used to finance various
improvement projects within the City.
TYPE OF PROPOSALS
Proposals shall be for not less than $4,191,200 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 $42,250,
payable to the order of the City. If a check is used, it must accompany the proposal. If a
Financial Surety Bond is used, it must be from an insurance company licensed to issue such a
bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to
Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must
identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the
Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is
required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's
check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central
Time, on the next business day following the award. If such Deposit is not received by that
time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement.
The Deposit received from the purchaser, the amount of which will be deducted at settlement
and no interest will accrue to the purchaser, will be deposited by the City. In the event the
purchaser fails to comply with the accepted proposal, said amount will be retained by the City.
No proposal can be withdrawn or amended after the time set for receiving proposals unless the
meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to
another date without award of the Bonds having been made. Rates shall be in integral
multiples of 5/100 or 1/8 of 1 %. Rates must be in level or ascending order. Bonds of the same
maturity shall bear a single rate from the date of the Bonds to the date of maturity. No
conditional proposals will be accepted.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling.
The City will reserve the right to: (i) waive non-substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals
without cause, and (iii) reject any proposal that the City determines to have failed to comply with
the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of
the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of
insurance shall be paid by the purchaser, except that, if the City has requested and received a
rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating
agency fees shall be the responsibility of the purchaser.
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds.
Page 22
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser.
SETTLEMENT
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser through DTC in New York, New York. Delivery will be subject to receipt by the
purchaser of an approving legal opinion of Kennedy & Graven, Chartered of 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
In accordance with SEC Rule 15c2-12(b)(5), the City will undertake, pursuant to the resolution
awarding sale of the Bonds, to provide annual reports and notices of certain events. A
description of this undertaking is set forth in the Official Statement. The purchaser's obligation
to purchase the Bonds will be conditioned upon receiving evidence of this undertaking at or
prior to delivery of the Bonds.
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,
85 East Seventh Place, Suite 100, Saint Paul, Minnesota 55101, telephone (651) 223-3000.
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any
underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no
more than seven business days after the date of such award, it shall provide without cost to the
senior managing underwriter of the syndicate to which the Bonds are awarded 170 copies of
the Official Statement and the addendum or addenda described above. The City designates
the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent
for purposes of distributing copies of the Final Official Statement to each Participating
Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby
that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall
enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes
of assuring the receipt by each such Participating Underwriter of the Final Official Statement.
Dated March 1, 2004 BY ORDER OF THE CITY COUNCIL
Isl Judith Cox
City Clerk
Page 23
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS:
TERMS OF PROPOSAL
$2,280,000*
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION BUILDING REFUNDING BONDS, SERIES 20048
(BOOK ENTRY ONL Y)
Proposals for the Bonds will be received on Tuesday, April 6, 2004, until 12:00 Noon, Central
Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul,
Minnesota, after which time they will be opened and tabulated. Consideration for award of the
Bonds will be by the City Council at 7:00 P.M., Central Time, of the same day.
SUBMISSION OF PROPOSALS
Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the
time of sale specified above. All bidders are advised that each Proposal shall be deemed to
constitute a contract between the bidder and the City to purchase the Bonds regardless of the
manner in which the Proposal is submitted.
(a) Sealed Bidding. Proposals may be submitted in a sealed envelope or by fax
(651) 223-3046 to Springsted. Signed Proposals, without final price or coupons, may be
submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting
to Springsted the final Proposal price and coupons, by telephone (651) 223-3000 or fax
(651) 223-3046 for inclusion in the submitted Proposal.
OR
(b) Electronic Bidding. Notice is hereby given that electronic proposals will be received via
PARIT~. 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 PAR/~ 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@ so~ as a
communication mechanism to conduct the electronic bidding for the Bonds, and PARIT is not
an agent of the City.
If any provisions of this Terms of Proposal conflict with information provided by PARI"fYD, this
Terms of Proposal shall control. Further information about PARITY@, including any fee
charged, may be obtained from:
PARITY@, 40 West 23rd Street, 5th Floor, New York City, New York 10010, Customer
Support, (212) 404-8102.
Page 24
DETAILS OF THE BONDS
The Bonds will be dated May 1, 2004, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing February 1, 2005. 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:
2006 $165,000 2009 $175,000 2012 $190,000 2015 $215,000
2007 $165,000 2010 $180,000 2013 $195,000 2016 $220,000
2008 $165,000 2011 $185,000 2014 $200,000 2017 $225,000
* The City reserves the right, after proposals are opened and prior to award, to increase or reduce the
principal amount of the Bonds offered for sale. Any such increase or reduction wilt be made in
multiples of $5,000 in any of the maturities. In the event the principal amount of the Bonds is
increased or reduced, any premium offered or any discount taken by the successful bidder will be
increased or reduced by a percentage equal to the percentage by which the principal amount of the
Bonds is increased or reduced.
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds. All term bonds shall be subject to mandatory sinking fund redemption
and must conform to the maturity schedule set forth above at a price of par plus accrued
interest to the date of redemption. In order to designate term bonds, the proposal must specify
"Years of Term Maturities" in the spaces provided on the Proposal Form.
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public. The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"),
New York, New York, which will act as securities depository of the Bonds. Individual purchases
of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single
maturity through book entries made on the books and records of OTC and its participants.
Principal and interest are payable by the registrar to OTC or its nominee as registered owner of
the Bonds. Transfer of principal and interest payments to participants of OTC will be the
responsibility of DTC; transfer of principal and interest payments to beneficial owners by
participants will be the responsibility of such participants and other nominees of beneficial
owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the
Bonds with DTC.
REGISTRAR
The City will name the registrar that 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, 2014, and on any day thereafter, to prepay Bonds due on or
after February 1, 2015. 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. OTC 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.
Page 25
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. The proceeds will be used to refund
the February 1, 2006 through February 1, 2017 maturities of the City's General Obligation
Building Bonds, Series 1997 A, dated June 1, 1997.
TYPE OF PROPOSALS
Proposals shall be for not less than $2,257,770 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 $22,800,
payable to the order of the City. If a check is used, it must accompany the proposal. If a
Financial Surety Bond is used, it must be from an insurance company licensed to issue such a
bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to
Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must
identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the
Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is
required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's
check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central
Time, on the next business day following the award. If such Deposit is not received by that
time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement.
The Deposit received from the purchaser, the amount of which will be deducted at settlement
and no interest will accrue to the purchaser, will be deposited by the City. In the event the
purchaser fails to comply with the accepted proposal, said amount will be retained by the City.
No proposal can be withdrawn or amended after the time set for receiving proposals unless the
meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to
another date without award of the Bonds having been made. Rates shall be in integral
multiples of 5/100 or 1/8 of 1%. Rates must be in level or ascending order. Bonds of the same
maturity shall bear a single rate from the date of the Bonds to the date of maturity. No
conditional proposals will be accepted.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling.
The City will reserve the right to: (i) waive non-substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals
without cause, and (iii) reject any proposal that the City determines to have failed to comply with
the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of
the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of
insurance shall be paid by the purchaser; except that, if the City has requested and received a
rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating
agency fees shall be the responsibility of the purchaser.
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds.
Page 26
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser.
SETTLEMENT
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser through DTC in New York, New York. Delivery will be subject to receipt by the
purchaser of an approving legal opinion of Kennedy & Graven, Chartered of 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
In accordance with SEC Rule 15c2-12(b )(5), the City will undertake, pursuant to the resolution
awarding sale of the Bonds, to provide annual reports and notices of certain events. A
description of this undertaking is set forth in the Official Statement. The purchaser's obligation
to purchase the Bonds will be conditioned upon receiving evidence of this undertaking at or
prior to delivery of the Bonds.
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,
85 East Seventh Place, Suite 100, Saint Paul, Minnesota 55101, telephone (651) 223-3000.
The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any
underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no
more than seven business days after the date of such award, it shall provide without cost to the
senior managing underwriter of the syndicate to which the Bonds are awarded 90 copies of the
Official Statement and the addendum or addenda described above. The City designates the
senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for
purposes of distributing copies of the Final Official Statement to each Participating Underwriter.
Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its
proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a
contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring
the receipt by each such Participating Underwriter of the Final Official Statement.
Dated March 1, 2004 BY ORDER OF THE CITY COUNCIL
Isl Judith Cox
City Clerk
Page 27