HomeMy WebLinkAbout15.F.3. Setting Bond Sale for Public Improvements and Public Works Building-Res. No. 6114 and Res. No. 6115
IS, f. 3,
CITY OF SHAKOPEE
Memorandum CO~ISENT
TO: Mayor and Council
Mark McNeill, City Administrator
FROM: Gregg Voxland, Finance Director
SUBJ: Setting Improvement!PW Building Bond Sale
DATE: September 14, 2004
Introduction
Council action is needed for setting the sale of improvement
bonds for 2004 projects and the Public Works building.
Background
Attached are resolutions prepared by bond counsel that sets
the sale of bonds. The 2004C improvement issue is a routine
event. The bonds to be sold are in the amount of
$2,570,000. The financed projects are 4th Ave., Weinandt
acres, and 2004 Overlay.
Also included is $6,000,000 2004D GO Capital Improvement
Bonds (Public Works)
The bond sale schedule is set to adopt this resolution on
September 21, sell the bonds on October 19hwith settlement
in about 30 days.
Action
Offer Resolution No. 6114 A Resolution Providing For The
Issuance and Sale of $2,570,000 General Obligation
Improvement Bonds, Series 2004C, and move its adoption.
Offer Resolution No. 6115 A Resolution Providing For The
Issuance and Sale of $6,000,000 General Obligation Capital
Improvement Bonds, Series 2004D, and move its adoption.
J~~
Finance Director
g\finance\cash\bonds\04CbondS
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 Tuesday,
September 21,2004, 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. 5114
RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF
$2,570,000 GENERAL OBLIGATION IMPROVEMENT
BONDS, SERIES 2004C
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 Proiect Cost
4th Avenue Naumkeg/Shenandoah
Weinandt Acres
2004 Overlay
Project Costs $2,521,740
Costs of Issuance 27,700
Underwriter's Discount 20,560
Total Issue $2,570,000 '
(b) it is necessary and expedient to the sound financial management of
the affairs of the City to issue $2,570,000 General Obligation Improvement Bonds, Series
2004C (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 $2,549,440. To provide in part the additional interest required to market the
Bonds at this time, additional Bonds will be issuedin the amount of $20,560. The excess of the
purchase price of the Bonds over the. sum of $2,549,440 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
THIS ISSUE ON ITS BEHALF. PROPOSALS ~LL BE RECEfVED ON THE
FOLLOWING BASIS:
TERMS OF PROPOSAL
$2,570,000
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2004C
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, October 19, 2004, until 10:00 A.M.,
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 ptiofto'llie-
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 Biddi/1.f[. 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) Electro/1.ic Biddi/1.f[. Notice is hereby given that electronic proposals will be received via
P ARITYID. For purposes of the electronic bidding process, the time as maintained by P ARITY@
shall constitute the official time with respect to all Bids submitted toPARITY@. Each bidder
shall be solely responsible for making necessary arrangements to access P ARITJIID 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
PARlTYID 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 ARITYID is not
an agent of the City.
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If any provisions of this Terms of Proposal conflict with information provided by PARITY@>, this
Terms of Proposal shall control. Further information about PARITY@, including any fee
charged, may be obtained from:
PARITY@, 1359 Broadway, 2nd Floor, New York, New York 10018
Customer Support: (212) 849-5000
DETAILS OF THE BONDS
The Bonds will be dated November 1,2004, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing August I, 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 $300,000 2010 $250,000 2014 $255,000
2007 $250,000 2011 $250,000 2015 $260,000
2008 $250,000 2012 $1<50,000
2009 $250,000 2013 $255,000
Proposals for the Bonds may contain. 8. maturitY-schedule providing for acoiribination of serial
bonds and term bonds. All term bonds shalrpe<.~ubject to rnan.datory 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 nomiI1.~~ofThe Depository Trust Company ("DTC"),
New York, New York, which will act ass~CUrities depository Qf the Bonds. Individual
purchases of the Bonds may be made inthepnncipal amolillt 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 DTe 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 pay for the services of the registrar.
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OPTIONAL REDEMPTION
The City may elect on February 1,2013, and on any day thereafter, to prepay Bonds due on or
after February 1,2014. Redemption may be in whole or in part and ifinpartatthe option of the
City and in such manner as the City shall determine. If less than all Bonds of a maturity are
called for redemption, the City will notify DTC of the particular amount of such maturity to be
prepaid. DTC will determine by lot the amount of each participant's interest.in such maturity to
be redeemed and each participant will then select by lot the beneficial ownership interests in
such maturity to be redeemed. All prepayments shall be at a price of par plus accrued interest.
SECURITY AND PURPOSE .
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. In addition the City will pledge special
ass~ssments against benefited. property. The proceeds will be used to finance various
improvement projects within the City.
TYPE OF PROPOSALS
Proposals shall be for notless than $2,549,440 and accrued interest on the total principal amount
of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in the form
of a certified or cashier's check or a Financial Surety Bond in the amount of $25,700, payable to
the order of the City. If a check is used, it must accompany the proposal. If a Financial Surety
Bond is used, 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
traIlsferas instiuCtedbySpringsted Incorporated not later than 3 :30 P.M., Central Time, on the
nexr-ousiness dajIollowing 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 sett\ement 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<otherratirigagency<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.cwillbe.. printedcon the
Bonds, but neither the failure to print such numbers on any Bondnorianyerrorwithtespect
thereto will constitute cause for failure or refusal by the purchaseit()accepfdeliveiyof 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
ofthe 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.
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CONTINUING DISCLOSURE
In accordance with SEC Rule 15c2-12(b)(5), the City will undertake, pursuant to the resolution
. ... awarding sale of the Bond, 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 bylaw, 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 100 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. Qity (i) it shall. accept such designation and (ii) it shall enter into a
contractual relationshipwith'allParticipatingUnderwriters of the Bonds for purposes of assuring
the receipt by each such ParticipatingcUtidehVriterofthe Final Official Statement.
Dated September 21, 2004 BY ORDER OF THE CITY COUNCIL
Isl 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, October 19, 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
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.
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STATE OF MINNESOTA )
)
COUNTY OF SCOTT )
)
CITY OF SHAKOPEE )
I, the undersigned, being the duly qualified and acting City Clerk of the City of
Shakopee, Minnesota, hereby certify that I have carefully compared the attached and foregoing
extract of minutes of a regular meeting of the City Council of the City held on Tuesday,
September 21, 2004, with the original minutes on file in my office and the extract is a full, true
and correct copy of the minutes, insofar as they relate to the issuance and sale of $2,570,000
General Obligation Improvement Bonds, Series 2004A of the City. ..
WITNESS My hand as City Clerk and the corporate seal of the City this _ day of
, 2004.
City Clerk
City of Shakopee, Minnesota
(SEAL)
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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 011 Tuesday,
September 21, 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. 6115
RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF
$6,000,000 GENERAL OBLIGATION CAPITAL IMPROVEMENT
PLAN BONDS, SERIES 2004D
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 Minnesota Statutes, section 410.326 (Act) to finance
certain capital improvements under an approved capital improvement plan by the
issuance of general obligation bonds of the City payable from ad valorem taxes.
Capital improvements include acquisition or betterment of public lands, buildings
or other improvements for the purpose of a city hall, public safety facility and
public works facilities (excluding light rail transit or any activity related to it, or a
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park, library, road, bridge, administrative building other than a city hall, or land
for any of those activities).
b) On January 20, 2004 the City held a public hearing regarding a five year capital
improvement plan (Plan), and regarding issuance of bonds in the maximum
principal amount of $6,000,000 to finance planned capital improvements, all in
accordance with the Act. The Plan authorizes issuance of bonds to pay the cost of
certain public works facilities (hereinafter referred to as the Public Works
Facilities).
c) The City Council has determined that, within 30 days after the hearing, no
petition for a referendum on issuance of bonds pursuant to the Plan was received
by the City in accordance with the Act.
d) The City estimates the total cost of the Public Works Facilities as follows:
Project Fund $5,884,600
Bond Discount 78,000
Costs of Issuance 37.400
Total Issue $6,000,000
e) As required by the Act, the City has determined that:
(i) the expected useful life of the Public Works Facilities will be at least five
years; and
(ii) the amount of principal and interest due in any year on all outstanding
bonds issued by the City under the Act, including the Bonds, will not
exceed .05367 percent of the taxable market value of property in either the
City or the County for taxes payable in 2004.
f) It is necessary and expedient to the sound financial management of the affairs of
the City to issue its $6,000,000 General Obligation Capital Improvement Plan
Bonds, Series 2004D (Bond) pursuant to the Act to provide financing for the
Public Works Facilities.
2. To provide financing for the Improvements, the City will issue and sell Bonds in
the amowlt of $5,922,000. To provide in part the additional interest required to market the
Bonds at this time, additional Bonds will be issued in the amount of $78,000. The excess of the
purchase price of the Bonds over the sum of $5,922,000 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 vnLL BE RECEIVED ON THE
FOLLOWING BASIS:
TERMS OF PROPOSAL
$6,000,000
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION CAPITAL IMPROVEMENT PLAN BONDS, SERIES 20040
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, October 19, 2004, until 10:00 A.M.,
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 Biddinl!. 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 Biddinl!. Notice is hereby given that electronic proposals will be received via
P ARITY@.. For purposes of the electronic bidding process, the time as maintained by P ARITY@
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!ID 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@ solely as a
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communication mechanism to conduct the electronic bidding for the Bonds, and P ARITY@ is not
an agent ofthe City. -
If any provisions of this Terms of Proposal conflict with information provided byPARITY@, this
Terms of Proposal shall control. Further information about PARITY@, including any fee
charged, may be obtained from:
PARITY@, 1359 Broadway, 2nd Floor, New York, New York 10018
Customer Support: (212) 849-5000
DETAILS OF THE BONDS
The Bonds will be dated November 1, 2004, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing August 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 $160,000 2011 $250,000 2016 $295,000 2021 $360,000
2007 $225,000 2012 $255,000 2017 $305,000 2022 $380,000
2008 $230,000 2013 $265,000 2018 $320,000 2023 $395,000 .
2009 $235,000 2014 $275,000 2019 $335,000 2024 $415,000
2010 $240,000 2015 $285,000 2020 $345,000 2025 $430,000
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 eachyear~ . 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 pay for the services ofthe registrar.
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OPTIONAL REDEMPTION
The City may elect on February 1,2015, and on any day thereafter, to prepay Bonds due on or
after February 1,2016. Redemption may be in whole or in part and ifin part at the option ofthe
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 finance
the construction of a public works facility.
TYPE OF PROPOSALS
Proposals shall be for not less than $5,922,000 and accrued interest on the total principal amount
of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in the fonn
of a certified or cashier's check or a Financial Surety Bond in the amount of $60,000, 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 proposl:l.ls. . 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 Incorporateditl th~Jorm of a certified or cashier's check or wire
transfer as instructed by Springsted Incorporated not later than 3:30P.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 5/1 00 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,-l:)Ut-neitherthefailur~toprintsuch numbers on any Bond nor any error with respect
"theretcF'Will constitute cause for failure or refusal by the purchaser to accept delivery of the
Bonds: The CUSIP.Service Bureaucha.rge forthe 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.
SlB-253086vl
SH155-145
CONTINUING DISCLOSURE
In accordance with SEC Rule 15c2-12(b)(5), the City will undertake, pursuant to the resolution
awarding sale of the Bond, 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
infonnation required by law, shall constitute a "Final Official Statem€mt'!-oftlieCity 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 240 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)'itshaU enter into a.
contractual relationship with all Participating Underwriters of the Bonds fotpurposes of-assuring
the receipt by each such Participating Underwriter of the Final Official Statement."
Dated September 21, 2004 BY ORDER OF THE CITY COUNCIL
/s/ Judith Cox
City Clerk
SJB-253086vl
SHl55.l4S
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, October 19, 2004, to consider proposals on the Bonds and take any other
appropriate action with respect to the Bonds. .. _u'';-' ..-~
The motion for the adoption of the foregoing resolution was duly 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.
SJB-2S3086vl
SHlSS-145
STATE OF MINNESOTA )
)
COUNTY OF SCOTT )
)
CITY OF SHAKOPEE )
I, the undersigned, being the duly qualified and acting City Clerk of the City of
Shakopee, Minnesota, hereby certify that I have carefully compared the attached and foregoing
extract of minutes of a regular meeting of the City Council of the City held on Tuesday,
September 21, 2004, with the original minutes on file in my office and the. extract is a full, true
and correct copy of the minutes, insofar as they relate to the issuance and sale of $6,000,000
G~neral Obligation Capital Improvement Plan Bonds, Series 2004D of the City.
WITNESS My hand as City Clerk and the corporate seal of the City this _ day of-.,,+
, 2004.
City Clerk
City of Shakopee, Minnesota
(SEAL)
SJB-253086vl
SH155-145
~
'--~ t'
~.
Recommendations
For
City of Shakopee,Minnesota
$2,570,000
General Obligation Improvement Bonds, Series 2004C
$6,000,000
General Obligation Capital Improvement Plan Bonds, Series 20040
Presented .to:
Mayor John Schmitt
Members, City Council
Mr, Mark McNeill, City Administrator
Mr. Gregg Voxland, Finance Director
City of Shakbpee
129 Holmes Street South
Shakopee, MN 55379-1376
SPRINGSTED
Study No.: S0750T4U4 ~ Ad""" to th, Public S"to,
SPRINGSTED Incorporated
September 14, 2004
.
'" RECOMMENDATIONS
Re: Recommendations for the Issuance of:
$2,570,000.General Obligation Improvement Bonds, Series 2004C
(the "Improvement Bonds")
$6,000,000 General Obligation Capital Improvement Plan Bonds, Series 20040
(the "CIP 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, October 19, 2004, at 10:00 A.M.
with award by the City Council at 7:00P.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@.lnaddition,
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 Improvement Bonds are being
issued pursuant to Minnesota Statutes,
Chapter 429.
5. Repayment Term The Improvement Bonds will mature
annually February' , 20Ot) through 2015.
Interest will be payable semi-annually each
February 1. and. August 1 ,commencing
August 1 ,2005.
The CIP Bonds will mature.annually
February 1, 2006 through 2025. Interestwill
be payable semi-annually each
February 1 and August 1, commencing
August 1, 2005.
6. 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
.
City of Shakopee, Minnesota
. September 14, 2004
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 selling larger
blocks of bonds reduces the risk to the
underwriter, allowing them to lower their
costs and the interest coupons. Since the
Bondsare 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.
7. Security and Source of Payments
(a) Security The Bonds will be general obligations of the
City.
(b) Source of Payments The Improvement Bonds will be repaid with
a combination of special assessments and
ad valorem. property taxes. The CIP Bonds
will be repaid from ad valorem property
taxes.
8. Prepayment Provisions In regards to the Improvement Bonds, the
Citymay elect on February 1 , 2013, and on
any day thereafter, to prepay the
Improvement Bonds due on or after
February.1 , 2014 at a price of par plus
accrued interest.
In regards to the CIP Bonds, the City may
elect on February 1, 2015, and on any day
thereafter, to prepay the CIP Bonds due on
or after February 1, 2016 at a price of par
plus accrued interest.
9. 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 "Aa3."
10. 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-
Page.2
-
City of Shakopee, Minnesota
, September 14, 2004
qualified typically receive. slightly lower
interest rates than issues that are not bank-
qualified. The issuance oftheBonds
togetherwith the City's prior bonds issued in
2004 exceedsthe $10 million limitation.
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 createdbytheJinancing
to be rebated to the U.S. Treasury... The .
requirements generally cover two
categories: bond proceeds and debt service
funds. There are exemptionsfrornrebate
that may apply in both of these categories.
Bond proceeds deposited to a
proj ect/constructionfund may qualify for
exemption from rebate if the proceeds are
spent in accordance withthe 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. For both series
of Bonds the City anticipates meeting onf3 of
the expenditure exceptions. Therefore the
Bonds would qualify for exemption to rebate.
(c) Bona Fide Debt Service Fund The City must maintain a bona fide debt
service fund forthe Bonds or be subject to
yield restriction. A bona fide debt service
fund is a fund for which there isan 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 that year or 1/12 ofthe debt
service of that year.
Additional diligence should be exercised in
monitoring the debt service fund for the
Improvement Bonds due to the potential
accumulation of prepayment of special
assessments, which could cause the fund to
become non-bona fide. Springsted currently
provides arbitrage rebate services forthe
City under a separate contract. An
amendment to that contract adding the
Improvement Bond issue has been provided
to City staff.
Page 3
.
City of Shako pee, Minnesota
, September 14, 2004
(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 Bonds.
(e) Economic Life The average life of the Bonds cannot
exceed 120% of the economic life of the
projects to be financed.
In regards to the Improvement Bonds, the
economic life of the improvement projects
exceeds 20 years. The average lifeof the
ImprovementBonds is 5.692 years;
therefore the Improvement Bonds are within
the economic life requirements.
In regards to the CIP Bonds, the economic
life of building construction is 40.-, 50 years.
The average life of the CIP Bonds is 12,069
years; therefore the CIP Bonds are within
the economic life requirements.
11- 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 these
Issues has been provided to City staff.
12. Attachments The Improvernent Bonds
. Sources and Uses Schedule
. Assessment Income Schedules
. Debt Service Schedule
The CIP Bonds
. Sources and Uses Schedule
. Debt Service Schedule
Terms of Proposals
Page 4
.
City of Shakopee,. Minnesota
- September 14, 2004
DISCUSSION
The Improvement Bonds
The proceeds of the Improvement Bohds will be used to finance three improvement projects
within the City as follows; the.. 2004 Overlay project, the 4th Avenue Nc:lUmkeg/Shenandoah
project, and the WeinandtAcres project. As shown in the sources and uses offunds. on page
7, 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 $145,000 of assessment
prepayments on the 4th Avenue Naumkeg/Shenandoah project, $19,200.. of assessment
prepayments on the Weinandt Acres project and $11,325 of assessment prepayments on the
2004 Overlay project that will be used to reduce the borrowing amount.
All assessments will be filed on or about November 1, 2004. Assessments will be spread over
terms of1 year on the 2004 Overlay project and 10 years on the other two projects, 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 Improvement Bonds. For
structuring purposes we have assumed a rate of 5.00% on the assessments.
The City staff has directed that we include certain assumptions regarding the prepayments on
assessments on all of the projects. These assumptions are outlined below. Page Bshows the
total projection offutureassessment collections based on the assumptions regarding the future
collection of deferred assessments and prepayments.
. 2004 Overlay project: 30% of the assessments totaling $11,325 are expected to be
prepaid in the. fall of 2004. The remaining assessments totaling $26,425 of principal
amount will be collected within the first year.
. 4th Avenue Naumkeg/Shenandoah project: 10% of the assessments totaling $145,000
are expected to be prepaid in the fall of 2004. The remaining assessments totaling
$1,305,000 of principal amount of the assessments are anticipated tobecoHectedineven
annual installments of principal over the full 1 0 year term of the assessments.
. Weinandt Acres proJect: 20% of the assessments totaling $19,200 are expected to be
prepaid in the fall of 2004; An additional 30% or $28,800 of the principal amount of the
assessments will be collected within' the first year. The remaining 50% of the original
principal amount of. the assessments totaling $48,000 are anticipated to be collected in
even annual. installments of principal over the full 10 year term of the assessments.
The Improvement Bonds have been structured around the anticipatedassessrnent income
receipts developed on pages 8 through 11 for a term of 10 years. Page 12 contains the
following information:
. Columns 1 through 4 show the annual principal, estimated interest rates and projected
total principal and interest payments on the Improvement Bonds, given the current market
environment.
. Column 5 shows the 5% overJevywhich 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 6 shows the total projected assessment income developed on pages 8 through .11.
. Column 7 shows the projected annual levy requirementfor the ImprovementBonds, which
represents the difference between the projected assessment income and 1 05% of debt
service.
Page 5
.
City of Shako pee, Minnesota
- September 14, 2004
Based on projected assessment income, it is expected that the City will be required to levy ad
valorem taxes to pay a portion of the debt service on the Improvement Bonds. The average
annual levy requirement for the Improvement Bonds will be approximately $141,800. The City
wiH make its first levy for the Improvement Bonds in 2004, howeverthe City anticipates abating
their annual levy and making the debt service payments from transfersfrom the City's General
Fund. Each year's collections of assessments will be used to make the August 1 interest
payment in the year of collection and the February t principal and interest payment in the
following year. As stated above, transfers from the City's. General. Fund wiH be made in the
amountnecessary tocover the levy requirement onthe Improvement Bonds.
The CIP Bonds
Proceeds of theCIP Bonds will used to finance the construction of a Public Works Facility. The
projected construction costs for the Public Works Facility is $6,475,000 of which the City will
make a cash contribution in the estimated amount of $590,400. Page 13 shows the sources
and uses of funds.
Cities may issue general obligation capital improvementbonds pursuant to Minnesota Statues,
Section 475.521. Under this statute, the maximum annual debt service on all outstanding
bonds issued for this purpose (capital improvement plan), including these CIP Bonds, cannot
exceed an amount equal to 0.05367% of the taxable market value of the property within the
City. The statutory maximum based on the City's taxable market value is $1,210,609. This
calculation is shown below. The estimated maximum annual debt service payment on the CIP
Bonds is projected to be approximately $454,455. Since the City has no other outstanding
bonds issued under this statute, the issuance of the CIP Bonds meets the statutory
requirement.
Market Value of Statutory
Taxable Property for Principal & Statutory Maximum
Taxes Pavable in 2004 Interest Limitation Principal & Interest
$2,255,653,800 0.05367% $1,210,609
The CIP Bonds has been structured with even annual principal and interest payments over a
term of 20 years. In discussion with the City, the recommended principal structure for the CIP
Bonds is shown on page 14. Page 14 shows the principal repayment dates, the annual
principal payments, estimated interest rates, the projected total principal and interest payments,
given the current market environment, and the 105% overlevymandated by State statute, which
serves as a protection to Bondholders and the City in the event of delinquencies in the
collection of taxes.
The City wiH make its first levy for the CIP Bonds in 2004, however the City anticipates abating
their annual levy and making the debt service payments from transfers from the City's Building
Fund.
We appreciate again being of service to the City of Shakopee.
mb
Provided to Staff: Contract Amendments for Continuing Disclosure and Arbitrage Rebate
Page 6
.
$2,570,000
- City of Shakopee, Minnesota
General Obligation Improvement Bonds
Series 2004C
Sources & Uses
Dated 11/01/2004 I Delivered 11/01/2004
Sources Of Funds
Par Amount of Bonds............ ............................................................................... ..................... ................. ...... .;. ............. $2,570,000.00
CI F Fund...............................................................;.................................. ................. ....................;.... ................ ....... ...... 710,000.00
Storm Fund.. ........................................;............................................................................................ .............. ;..........;.... 400,000.00
Prepays- 4th Ave Project.... .........'... .............................................. ...........;................................... ........... ...... " ,...... ...;..... 145,000.00
Sewer Fund....... ......'.. .;........... ........ ................ ......... ....'...... ..... ...... .... ........ ;...; .... ..... ....... ................ .............. ... .;.....;.........' 81,000.00
Water Fund...... ..........,... .... .................. ... ..;.... ............. .......... ,..... ............ ...... ................... ....... .......... ... .... .... .... .... ..... .....: 50,000.00
Prepays - Weinandt Acres....... ..........,....................;...................................... ...................................;....... ..:. ...... .............. .19,200.00
Prepays - 2004 Overlay Project..........,............................................... ........................ ......... ........................... ..... ..... ......, 11,325.00
Total So urces ........;....... ..... ............ ................ ........ ............. .....,............. ....................... .............. ..,............... ..... ........... $3,986,525.00
Uses Of Funds
4th Ave Naumkeg/Shenandoah................ ..... .... .......... ..... .... ................ ,.. ...... ............ .......... ......... ..... ... " .;.... ," ................ 3,370,000.00
Weinandt Acres................................................................ ............. ....................... ...... ................................ .................... ,. 384,000.00
2004 Overlay.... ...... ....... .......... .... .... ............. ...... .... ...... ..... .... .......... ......... .... ....... ........ ...... ............. ........,.... .,. ......;.... ....... 182,000.00
Costs of Issuance...... .............. .......... .... ............. ..... ... ........... ... .............; ...... ........ ....... ... .;......... ....... ...... ..... ... ...... .... ...... 27,700.00
Total Underwriter's Discount (0.800%).......... ..;. ..............................;................................................. .......................... .... 20,560.00
Rounding Amount.............................................................;.................................. ......................... .... .......... .............. ...... 2,265.00
T ota I Uses.............. ................... ....................... ................... ............. ...... ............... ............ .............; ............................... $3,986,525.00
Series2004C 1 .\YNGLEPUKPOSE / 8/31/2004 / 4:10PM
-$-SPRINGSTlm
Adyj311~ t.o the Pubflc Set1:o1
Page 7
.
$1,408,225
-
City of Shakopee,Minnesota
General Obligation Improvement Bonds, Series 2004C
TOTAL PROJECTED ASSESSMENT INCOME
DATE 2004C 2004C 2004C TOTAL
Assessments Assessments 4th Assessments
2004 Overlay Ave Weinandt Acres
12/31/2005 27,966.46 206,625.00 38,080.00 272,671.46
12/31/2006 - 189,225.00 6,960.00 196,185.00
12/31/2007 - 182,700.00 6,720.00 189,420.00
12/31/2008 - 176,175.00 6,480.00 182,655.00
12/31/2009 - 169,650.00 6,240.00 175,890.00
12/31/2010 163,125.00 6,000.00 169,125.00
12/31/2011 - 156,600.00 5,760.00 162,360.00
12/31/2012 - 150,075.00 5,520.00 155,595.00
12/31/2013 - 143,550.00 5,280.00 148,830.00
12/31/2014 - 137,025.00 5,040.00 142,065.00
Total $27,966.46 $1,674,750.00 $92,080.00 $1,794,796.46
Par Amounts Of Selected Issues
2004C Assessmen-2004 Overlay..... ......... ... .... ... ........ ....... .... ...... ..... ... .,.. ... ........... ................ ....... ....... ........ ....... .... .... ....... 26,425.00
2004C Assessmen-4th Ave.. .......... ........... ... .... ... ......... ....;. .... ............... ............. ............ .........;. ........... ......... .......... ..... ..... 1,305,000.00
2004C Assessmen-Weinandt Acres. ..... .... ......... ....... ..... .......... ............... ..... ......... ... ...... ........... ..... ....; ........ ........ ... .......... 76,800.00
TOTAL... ............ ..................... ................ ............ ........ ........................;.................. ....... ............. .................. ............. ......... 1,408,225.00
Aggregate I 8/3//2004 I 4:27PM
~~~~~r:ifi~lr~,~
Page 8
.
$26,425
- City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004C
ASSESSMENT INCOME
Date PrinciPal Coupon Interest Total P+I
12/31/2004 - - - -
12/31/2005 26,425.00 5.000% 1,541.46
Total $26,425.00 - $1,541.46
SIGNIFICANT DATES
Filing Date........................... .............,.................................... ............................................ ,.;... ........................ ....;....... ,.....,..... 11/01/2004
First Payment Date..........................;..............................................,.............. ................................ ............ ......;........ ............. 12/31/2005
2004'-'AssesslIleJ1/s / 2004 Overlay / S/SI/2004 I 4:12PM
-$-SPRINGSTIm
Adv:b'~l$ to thtt 1'uh1ic Sectvr
Page 9
.
$1,305,000
City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004C
ASSESSMENT INCOME
Date Principal Coupon Interest Total P+I
12/31/2004 - - - -
12/31/2005 130,500.00 5.000% 76,125.00 206,625.00
12/31/2006 130,500.00 5.000% 58,725.00 189,225.00
12/31/2007 130,500.00 5.000% 52,200.00 182,700.00
12/31/2008 130,500.00 5.000% 45,675.00 176,175.00
..12/31/2009 130,500.00 5.000% 39,150.00 169,650.00
12/31/2010 130,500.00 5.000% 32,625.00 163,125.00
12/31/2011 130,500.00 5.000% 26,100.00 156,600.00
12/31/2012 130,500.00 5.000% 19,575.00 150,075.00
12/31/2013 130,500.00 5.000% 13,050.00 143,550.00
12/31/2014 130,500.00 5.000% 6,525.00 137,025.00
Total $1,305,000.00 - $369,750.00 $1,674,750.00
SIGNIFICANT DATES
Filing Date...........;......... ................. .......... ....... ........ .... ............. ...... .... ......... ... .....,.;..... ........ ......... ................. ................. ..... 11/01/2004
First Payment Date. ... ......... ............. ......... .......... ...... ..... .......".. ...........:. ............ ......... ... ..... ..;.,... ... ..... ............... .... ........... 12/31/2005
2004CAssesslllcJ1ts / 4thAvc / 8/31/2004 /4:12PM
~SI>IUNGSTED
, Adl'l1'-'l$ to rhd>ublic S~t:t(Jr
Page 10
4
$76,800
City of Shakopee, Minnesota
General Obligation Improvement Bonds, Series 2004C
ASSESSMENT INCOME
Date Principal Coupon Total P+I
12/31/2004 - - -
12/31/2005 33,600.00 5.000% 4,480.00 38,080.00
12/31/2006 4,800.00 5.000% 2,160.00 6,960.00
12/31/2007 4,800.00 5.000% 1,920.00 6,720.00
12/31/2008 4,800.00 5.000% 1,680.00 6,480.00
12/31/2009 4,800.00 5.000% 1,440.00 6,240.00
12/31/2010 4,800.00 5.000% 1 ;200.00 6,000.00
12/31/2011 4,800.00 5.000% 960.00 5,760.00
12/31/2012 4,800.00 5.000% 720.00 5,520.00
12/31/2013 4,800.00 5.000% 480.00 5,280.00
12/31/2014 4,800.00 5.000% 240.00 5,040.00
Total $76,800.00 - $15,280.00 $92,080.00
SIGNIFICANT DATES
Filing Date.................. .............................. ... ...... ....... ...... ..... ..... ....,.... ....... ............ ........... ..... .......... ....,........ .,..... ..., ....... ;......; 11/01/2004
First Payment Date.. .............. .... ............... ...... .......... .... ....... .... .u...... .... ............;........... .... ............ .... ...... ....... ......... .;.; ,. ...u... 12/3112005
2004CASSCS;7I1CJ1ls / Wei/Uwdl Acres r 8/.11/2004 / 4:/2 PM
-$ SI>RINGSTED
-, AdrisOl~ to the l'ubbt Sl!ctDC
Pagen
.
$2,570,000
City of Shakopee, Minnesota
General Obligation Improvement Bonds
Series 2004C
NET DEBT SERVICE SCHEDULE
Date Principal. Coupon Interest Total P+I 105% ofTotal Assessment Levy Required
(1 ) (2) (3) (4) (5) (6) (7)
_ 02/01/2005 - - - - - - -
02101/2006 300,000.00 1.800% 96,753.13 396,753.13 416,590.79 272,671.46 143,919.33
02/01/2007 250,000.00 2.150% 72,002.50 322,002.50 338,102.63 196,185.00 141,917.63
02/01/2008 250,000.00 2.550% 66,627.50 316,627.50 332,458.88 189,420.00 143,038.88
02/01/2009 250,000.00 2.850% 60,252.50 310,252.50 325,765.13 182,655.00 143,110.13
02101/2010 250,000.00 3.050% 53,127.50 303,127.50 318,283.88 175,890.00 142,393.88
02/01/2011 . 250,000.00 3.250% 45,502.50 295,502.50 310,277.63 169,125.00 141,152.63
02101/2012 250,000.00 3.450% 37,377.50 287,377.50 301,746.38 162,360.00 139,386.38
02101/2013 255,000.00 3.600% 28,752.50 283,752.50 297,940.13 155,595.00 142,345.13
02101/2014 255,000.00 3.750% 19,572.50 274,572.50 288,301.13 148,830.00 139,471.13
02101/2015 260,000.00 3.850% 10,010.00 270,010.00 283,510.50 142,065.00 141,445.50
Total $2,570,000.00 - $489,978.13 $3,059,978.13 $3,212,977.04 $1,794,796.46 $1,418,180.58
Dated................................................................................................................................................................................. 11/01/2004
Delivery Date. ...... .......... ........ .... ............. ....... ........ .... .;.. .............. .... .... ...... ...... ...... ............ .... ...... .... ...... ...... .... ...... .... ........ 11/01/2004
First Coupon Date;. ...,.. .... ...... ............ ...... ...... ........ .,.. .... ...... ........ .......... ............ .... .... .... .... .,.. .... ...... ...... .....,.... ....... ...... ..... 8/01/2005
Yield Statistics
Bond .Year Dollars... .;........... ............ ................ ......;. ...... ...... ........ ....... ....... .... .... ... ..... ...... .... ..... ...... ... .......... ..... '" .... ...... ... $14,627.50
Average .Life....... .... ............ .... ...... .... ...... ...... ........ .....; ............ .... ....... ..... ...... ...... .................. ...... .......... .......... .......... ...... .., 5.692 Years
Average Coupon;............, ...... ..... ,.... ...... ....... ....... ...... ...... ...;.. .... ............ .... .... .... .... .... ...... .... ...... ... ..... .... ...... ..... '" .......... .... 3.3497052%
Net Interest Cost (NIC)...... .... .... ...... .... ........ ...... .... ......... ..... .... ,... .............. ........... .... ...... ..;. .... .... ...... .... .......... .... .... ... ... ...... 3.4902624%
True Interest Cost (TIC)... .... .............. ...... .,.... ...... .............. .... .... .... ........ .... .... .... ... ..... .......... .... .... ..... .... ..... .... .... .... .... .,. ..... 3.4864054%
Bond Yield for Arbitrage Purposes... ,........... .... ...,.... ...... .......... ...... .... ...... .... .......... .... ...... .... ..... ......... .... ........;. ....... ........ .... 3.3275106%
Alii nclusive Cost (AI C).. ...... .... .... ...... ...... ............ ...... ...... ...... .............. ......... ....... .... .... ...... .... .... ............ ...... ........ .... .... ....... 3.7033751%
IRS Form 8038
Net Interest Cost......;....... ...... ...... .... ...... ...... .... .......... .... ...... .... .... .............. .... .... .......... ...... .... .... ........ .......... ..... ... .... .... ..... 3.3497052%
Weighted Average Maturity.. ......... .... ...... ............ ...... ...... ...... ... .... ................ ..... .... ... ... .... ...... .... .... .... .... .... ...... ........ .... .... ..... 5.692 Years
Series2()04C I JINGLE PURPOSE 18/31/2004 I 4:10PM
$SPRINGSTED
. Advisllrs!... t.lle'Publj( SIII:t,.,
Page 12
~
$6,000,000
Cityof Shakopee, Minnesota
General Obligation Capital Improvement Plan Bonds
Series 2004D
Sources & Uses
Dated 11/01/20041 Delivered 11/01/2004
Sources Of Funds
Par Amount of Bonds....................;...................... ...... ......... .;................ .......... ...... ...... ........ .................. .... ,.... .................. $6,000,000.00
City Contributions............... ..... ............... ...... ... .......... ....... ....... .... ........ ...... ...... ..... ...;.......... ... ... ........ .... .,. ...... ..... ...... ....;.... 590,400.00
T atal Sa u rees..... ................ .......... .......................... .............,...... ............... ........ ............... ............ ....................,............ $6,590,400.00
Uses Of Funds
Deposit to Project Construction Fund............ ......;..... .......................... n...... .......... ...... ...,....;............... ................... ......... 6,475,000.00
Total Underwriter's Discount (1.300%)................ i.......... .................................... ....... ........ ............. .... ....................... .;.... 78,000.00
Costs of Issuance.. ............. ..... ..... ..... ...... ..... ............. ... ... .... ..... .......... ..... ....... .... ....... ....;..... '" .... ........., ;..... ......... ....... .... 37,400.00
T atal Uses....... .................... ....... ...................... ........... ............ .............. ............. .............. ................................. ......,...... $6,590,400.00
Series2004UI .WNGU'Pl1KPOSE I 9/2/2004 I /0:12AM
~SPRINGSTED
Advisors t/.l UJe Public Sl.'ctl'J'
Page 13
.
$6,000,000
City of Shakopee, Minnesota
General Obligation Capital Improvement Plan Bonds
Series 20040
DEBT SERVICE SCHEDULE
Date Principal Coupon Interest Total P+I 105% Levy
02/01/2005 - - - - -
02/01/2006 160,000.00 1.800% 290,068.75 450,068.75 472,572.19
02/01/2007 225,000.00 2.150% 229,175.00 454,175.00 476,883.75
02/01/2008 230,000.00 2.550% 224,337.50 454,337.50 477,054.38
02/01/2009 235,000.00 2.850% 218,472.50 453,472.50 476,146.13
02/01/2010 240,000.00 3.050% 211,775.00 451,775.00 474,363.75
02/01/2011 250,000.00 3.250% 204,455.00 454,455.00 477,177.75
02/01/2012 255,000.00 3.450% 196,330;00 451,330.00 473,896.50
02/01/2013 265,000.00 3.600% 187,532.50 452,532.50 475,159.13
02/01/2014 275,000.00 3.750% 177,992.50 452,992.50 475,642.13
02/01/2015 285,000.00 3.850% 167,680.00 452,680.00 475,314.00
02/01/2016 295,000.00 3.950% 156,707;50 451,707.50 474,292.88
02/01/2017 305;000.00 4.050% 145,055.00 450,055.00 472,557.75
02/01/2018 320,000.00 4.150% 132,702.50 452,702.50 475,337.63
02/01/2019 335,000.00 4~250% 119,422.50 454,422.50 477,143.63
02/01/2020 345,000.00 4.350% 105,185.00 450,185.00 472,694.25
02/01/2021 360,000.00 4.450% 90,177;50 450,177.50 472,686.38
02/01/2022 380,000.00 4.500% 74,157.50 454,157.50 476,865.38
02/01/2023 395,000.00 4.550% 57,057.50 452,057.50 474,660.38
02/01/2024 415,000.00 4.600% 39,085.00 454,085.00 476,789.25
02/01/2025 430,000.00 4.650% 19,995.00 449,995.00 472,494.75
Total $6,000,000.00 - $3,047,363.75 $9,047,363.75 $9,499,731.94
SIGNIFICANT DATES
Dated.. ................ .... ................ ............. ........ ....... ... .... ......... ....... ................ ...... .... ... ................ ..... ..... ............ ......... ,.......... 11/01/2004
Delivery Date.... ............. ..... ..... .....;............... .... ............. .... ......;....... ..................... ...... .... .......... ......... .................... ....... ..... 11/01/2004
First Coupon Date.................................. .............................................~........... .................................................................. 8/01/2005
Yield Statistics
Bond Year Dollars................ ................................. ................ ........................ ..;.................. ............................................... $72,415.00
Average Life............. ................................................................................................................................................... ...... 12.069 Years
Average Coupon................. .................................. ..................... ..~........ .....;...................................................................... 4.2081941%
Net Interest Cost (NIC) ............~.......;.............. ................... ............... .............~........ ............................................... ........... 4.3159066%
True Interest Cost (TiC)............................................................. ................................................ ............................... ........ 4.3069398%
Bond Yield for Arbitrage. Purposes.... ............. ........ .................................................... ................ ...................~................... 4.1626754%
All Inclusive Cost (AI C)...................................................,,,.................................. ................................... .......... ................ 4.3770835%
IRS. Form 8038
Net . Interest Cost.. ................;.....;........................................ ....................................................................... ...... ................. 4.2081941%
Weighted Average Maturity..... .... ..................... .......... ..... ..... .................... ............ .... ...... ......... ....... ..... '" ... .;...... ................ 12.069 Years
Interest rates are estimates. Changes in rates may
cause significant alterations to this schedule.
The actual underwriter's discount bid may also vary.
Series2004D / J7N(,LEPUKf'OSE / 9/2/2004 / !0:12AM
~SPRINGSTED
Adl'iscs'Sl'.l tllePublkS.I!I..tor
Page 14
.
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS Will BE RECEIVED ON THE FOllOWING BASIS:
TERMS OF PROPOSAL
$2,570,000
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2004C
(BOOKENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, October 19, 2004, until 10:00 A.M.,
Central Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 1 00,. Saint
Paul, Minnesota, after which time they will be opened and tabulated. Consideration Jor award
of the Bonds will be by the City Council at 7:00 P.M., Central Time; ofthe same day.
SUBMISSION OF PROPOSALS
Springsted will assume no liability for the inability of the bidder toreach. 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 BiddinQ. 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
PAR I Tys'. For purposes of the electronic bidding process, the time as maintainedby PARITYB>
shall constitute the official time with respect to all Bids submitted to PARITYB>. . Each bidder
shall .be solelyrespansible far making necessary arrangements to access PARIT~ .for
purposes of submitting its electronic Bid in a timely manner and in compliance with the
requirements aUhe Terms of Prapasal. Neither the City, its agents nor PARITYB> 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 operationaf, 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 PARITYB> solelY as a
communication mechanism to conductthe electronic bidding for the Bonds, and PARITY"" is not
an agent of the City,
If any provisions of this Terms of Proposal conflict with information provided by PARITYB>, this
Terms of Proposal shall control. Further information about PARITYB>, including any fee
charged, may be obtained from:
PARITY@, 1359 Broadway, 2nd Floor, New York, New York 10018
Customer Support: (212) 849-5000
Page 15
.
DETAILS OF THE BONDS
The Bondswill be dated November 1, 2004, as the date of originalissue, and will bear interest
payable on February 1 and August 1 of each year, commencing August 1, 2005. Interest will
be computed on the basis of a 360-dayyear of twelve 30-day months.
The Bonds vvill mature February 1 in the years and amounts as follows:
2006 $300,000 2010 $250,000 2014 $255,000
2007 $250,000 2011 $250,000 2015 $260,000
2008 $250,000 2012 $250,000
2009 $250,000 2013 $255,000
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. I n 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
otthe 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 DTe 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 theBonds, will be required to deposit the
Bonds with DTC.
REGISTRAR
The Issuer 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, 2013, and on any day thereafter, to prepay Bonds due on or
after February 1 , 2014. Redemption may be in whole or in part and if in part at the option of the
City and in such manner as the City shall determine. If less than all Bonds of a maturity are
called for redemption, the City will notify DTC of the particular amount of such maturity to be
prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to
be redeemed and each participant will then select by lot the beneficial ownership interests in
such maturity to be redeemed. All prepayments shall be at a price of par plus accrued interest.
SECURITYAND 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.
Page 16
.
TYPE OF PROPOSALS
Proposals shall be for not less than $2,549,440 and accrued interest on the total principal
amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in
the form of a certifiedorcashier's check or a FinancialSurety Bond in the amount of $25,700,
payable tothe 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 ofthe 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 Iricorporatednotlaterthan3:30 P;M.,Central
Time, on the next business day following the award. If suchDepositisnot 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 theeventthe
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%. Ratesmustbe in level orascending order, Bondsof 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 INSURANCEAT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance brcommitment
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 ofCUSIP 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
Paget?
.
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paidby 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 thatshallbe
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
theCity 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 Bond, 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 15c2-12of 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 bylaw, shall constitute a "Final Official StatementUof 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 100 copies of
the Official Statement and the addendum or addenda described above. The City designates
the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent
for purposes of distributing copies of the Final Official Statement to each Participating
Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby
that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall
enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes
of assuring the receipt by each such Participating Underwriter of the Final Official Statement.
Dated September 21 , 2004 BY ORDER OF THE CITY COUNCIL
Isl Judith Cox
City Clerk
Page 18
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE
ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS: .
TERMS OF PROPOSAL
$6,000,000
CITY OFSHAKOPEE, MINNESOTA
GENERAL OBLIGATION CAPITAL IMPROVEMENT PLAN BONDS, SERIES 20040
(BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Tuesday, October 19,2004, until 1 0:00 A.M"
Central Time, at the offices of Springstedlncorporated,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 at7:00 P.M., Central Time, ofthe 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 BiddinQ. Proposals may be submitted in a sealed envelope or by fax
(651) 223-3046 to Springsted. Signed Proposals, without final. price orcQupons,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 BiddinQ. Notice is hereby given that electronic proposals will be. received via
PARITy;', For purposes of the .electronic bidding process, the time as maintained by PARITVW
shall constitute the official time with respect to all Bids submitted to PARITVW. Each bidder
shall be . solely responsible for making necessary arrangements to access PARI~ for
purposes of submitting its electronic Bid inatimely manner and in compliance with the
requirements of the Terms of Proposal. Neither the City, its agents nor PARITVWshall have
any duty or obligation to undertake registration to bid for any prospective bidder or to provide or
ensure electronic access toany qualified prospective bidder, and. neither the City, its agents nor
P ARITVW 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 orany damages
caused by the services of PARITVW. The City is using the services of PARITVW SOI~ as. a
communication mechanism to conduct the electronic bidding for the Bonds,andPARIT is not
an agent of the City.
If any provisions of this Terms of Proposal conflict with information provided byPARI~, this
Terms. of Proposal. shall. control. Further information about PARITVW, including any fee
charged, may be obtained from:
PARITVW, 1359 Broadway, 2nd Floor, New York, New York 10018
Customer Support (212) 849-5000
Page 19
~
, DETAILS OF THE BONDS
The Bonds will be dated November 1, 2004, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing August 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 $160,000 2011 $250,000 2016 $295,000 2021 $360,000
2007 $225,000 2012 $255,000 2017 $305,000 2022 $380,000
2008 $230,000 2013 $265,000 2018 $320,000 2023 $395,000
2009 $235,000 2014 $275,000 2019 $335,000 2024 $415,000
2010 $240,000 2015 $285,000 2020 $345,000 2025 $430,000
Proposals for the Bonds may contain a maturity schedule providing fora 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 aboveata price of par plus accrued
interesUothe 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 ("OTC"),
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. registrarto OTC or its nominee as registered owner of
the Bonds. Transfer of principal and interest payments to participants of OTe will be the
responsibility of OTC; 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 Issuer 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, 2015, and on any day thereafter, to prepay Bonds due on or
after February 1, 2016. Redemption may bein 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 OTCof 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.
SECURITYAND 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 finance
the construction of a public works facility.
Page 20
.
-
TYPE OF PROPOSALS
Proposals shall be for not less than $5,922,000 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 amountof$60,000,
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 besubmittedto
Springsted Incorporated prior to the opening of the proposals. The FinanciaLSurety 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 Springstedlncorporated 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 receive.d 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 e\lent the
purchaser fails to complywith 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 shaH be in integral
multiples of 5/100 or 1/8 of 1%. Rates must be in level or ascending order. Bondsofthesame
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. a.ny 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 shal~ 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
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~ Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser. .
SETTLEMENT
Within40 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. Onthe date of
settlement, payment for the Bonds shall be made in federal, or equivalent, funds thatshall 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 Bond, 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.
OFFICIALSTA TEMENT
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 tathe 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 240 copies of
the Official Statement and the addendum or addenda described above. The City designates
the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent
for purposes of distributing copies of the Final Official Statement to each Participating
Underwriter.. Any underwriter delivering a proposal with respect to the Bonds agrees thereby
that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall
enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes
of assuring the receipt by each such Participating Underwriter of the Final Official Statement.
Dated September 21,.2004 BY ORDER OFTHE CITY COUNCIL
Isl Judith Cox
City Clerk
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