New Issue

Transcription

New Issue

New Issue
Date of Sale:
Investment Rating:
Moody’s Investors Service…
(Rating Requested)
Tuesday, April 19, 2011
10:30 - 11:00 A.M., C.D.T. (Speer Auction – Closed)
11:00 A.M., C. D. T. (Sealed Bids)
(Alternative Bid Methods)
Official Statement
Subject to compliance by the Issuer with certain covenants, in the opinion of Ahlers & Cooney, P.C., under present laws, interest on the Notes is excluded from gross income for
federal income tax purposes and interest on the Notes is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however,
with respect to corporations (as defined for federal income tax purposes), such interest is included in adjusted current earnings for the purpose of determining the alternative minimum tax
imposed on such corporations. Interest on the Notes is not exempt from present Iowa income taxes. The Notes will be designated as “qualified tax exempt obligations.” See “THE NOTES –
TAX MATTERS” herein.
$6,915,000*
CITY OF BOONE
Boone County, Iowa
General Obligation Capital Loan Notes, Series 2011
Dated May 15, 2011
Book-Entry
Bank Qualified
Due Serially June 1, 2012 - 2030
The $6,915,000* General Obligation Capital Loan Notes, Series 2011 (the “Notes”) are being issued by the City of Boone, Boone County, Iowa (the “City”).
Interest is payable semiannually on June 1 and December 1 of each year, commencing December 1, 2011. The Notes will be issued using a book-entry system. The
Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the Notes. The ownership of one fully registered Note for each
maturity will be registered in the name of Cede & Co., as nominee for DTC and no physical delivery of Notes will be made to purchasers. The Notes will mature on
June 1 in the following years and amounts.
AMOUNTS*, MATURITIES AND INTEREST RATES
Principal
Due
Amount
June 1
$830,000 ........................ 2012
760,000 ........................ 2013
480,000 ........................ 2014
485,000 ........................ 2015
450,000 ........................ 2016
215,000 ........................ 2017
220,000 ........................ 2018
225,000 ........................ 2019
235,000 ........................ 2020
245,000 ........................ 2021
Interest
Rate
______%
______%
______%
______%
______%
______%
______%
______%
______%
______%
Yield or
Price
______%
______%
______%
______%
______%
______%
______%
______%
______%
______%
CUSIP
Number
______
______
______
______
______
______
______
______
______
______
Principal
Due
Amount
June 1
$255,000 ........................ 2022
265,000 ........................ 2023
280,000 ........................ 2024
290,000 ........................ 2025
300,000 ........................ 2026
320,000 ........................ 2027
335,000 ........................ 2028
355,000 ........................ 2029
370,000 ........................ 2030
Interest
Rate
______%
______%
______%
______%
______%
______%
______%
______%
______%
Yield or
Price
______%
______%
______%
______%
______%
______%
______%
______%
______%
CUSIP
Number
______
______
______
______
______
______
______
______
______
*Any consecutive maturities may be aggregated into no more than five term notes at the option of the bidder, in which case the mandatory
redemption provisions shall be on the same schedule as above.
OPTIONAL REDEMPTION
Notes due June 1, 2012 – 2020, inclusive, are non-callable. Notes due June 1, 2021 - 2030, inclusive, are callable in whole or in part on any date on or after
June 1, 2020, at a price of par and accrued interest. If less than all the Notes are called, they shall be redeemed in such principal amounts and from such maturities as
determined by the City and within any maturity by lot. See “OPTIONAL REDEMPTION” herein.
PURPOSE, LEGALITY AND SECURITY
Note proceeds will be used to: (i) pay costs of improvements, extensions and equipping the municipal sewer system; (ii) currently refund the City’s
outstanding general obligation notes, including Series 2002, 2003, 2003A, 2005, 2005A and the City’s outstanding General Obligation Capital Loan Note Anticipation
Note, Series 2008; and (iii) pay the cost of issuance of the Notes. See “PLAN OF FINANCING” herein.
In the opinion of Bond Counsel, Ahlers & Cooney, P.C., Des Moines, Iowa, the Notes will constitute valid and legally binding obligations of the City
payable both as to principal and interest from ad valorem taxes levied against all taxable property therein without limitation as to rate or amount, all except as limited by
bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors’ rights generally and except that enforcement by
equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion.
The City intends to designate the Notes as “qualified tax-exempt obligations” pursuant to the small issuer exception provided by Section 265(b)(3) of the
Internal Revenue Code of 1986 as amended.
This Official Statement is dated April 7, 2011, and has been prepared under the authority of the City. An electronic copy of this Official Statement is
available from the www.speerfinancial.com web site under “Official Statement Sales Calendar”. Additional copies may be obtained from Mr. Luke Nelson, City
Administrator/Clerk, City of Boone, 923 8th Street, Boone, Iowa 50036-0550, or from the Independent Public Finance Consultants to the City:
Established 1954
Speer Financial, Inc.
INDEPENDENT PUBLIC FINANCE CONSULTANTS
ONE NORTH LASALLE STREET, SUITE 4100 • CHICAGO, ILLINOIS 60602
Telephone: (312) 346-3700; Facsimile: (312) 346-8833
531 COMMERCIAL STREET, SUITE 608 • WATERLOO, IOWA 50701
Telephone: (319) 291-2077; Facsimile: (319) 291-8628
www.speerfinancial.com
*Subject to change. The City reserves the right to change the principal amount of the Notes to effect the City’s desired refunding savings, but any such change shall not increase
the principal amount of the Notes above $6,915,000. Any such change will be in increments of $5,000 and may be made in any of the maturities. In such event, the purchase price
of the Notes will be adjusted proportionately allowing the same dollar amount of gross spread per $1,000 Note (assuming a delivery date of May 18, 2011).
City of Boone, Boone County Iowa
$6,915,000* General Obligation Capital Loan Notes, Series 2011
For purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, this document, as the
same may be supplemented or corrected by the City from time to time (collectively, the “Official Statement”), may be
treated as an Official Statement with respect to the Notes described herein that is deemed near final as of the date hereof
(or the date of any such supplement or correction) by the City.
The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates,
principal amounts and interest rates of the Notes, together with any other information required by law or deemed
appropriate by the City, shall constitute a “Final Official Statement” of the City with respect to the Notes, as that term is
defined in Rule 15c2-12. Any such addendum shall, on and after the date thereof, be fully incorporated herein and made a
part hereof by reference.
No dealer, broker, salesman or other person has been authorized by the City to give any information or to make
any representations with respect to the Notes other than as contained in the Official Statement or the Final Official
Statement and, if given or made, such other information or representations must not be relied upon as having been
authorized by the City. Certain information contained in the Official Statement and the Final Official Statement may have
been obtained from sources other than records of the City and, while believed to be reliable, is not guaranteed as to
completeness. THE INFORMATION AND EXPRESSIONS OF OPINION IN THE OFFICIAL STATEMENT AND
THE FINAL OFFICIAL STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF THE
OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE UNDER EITHER
SUCH DOCUMENT SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE CITY SINCE THE RESPECTIVE DATES THEREOF.
References herein to laws, rules, regulations, ordinances, resolutions, agreements, reports and other documents do
not purport to be comprehensive or definitive. All references to such documents are qualified in their entirety by
reference to the particular document, the full text of which may contain qualifications of and exceptions to statements
made herein. Where full texts have not been included as appendices to the Official Statement or the Final Official
Statement they will be furnished on request. This Official Statement does not constitute an offer to sell, or solicitation of
an offer to buy, any securities to any person in any jurisdiction where such offer or solicitation of such offer would be
unlawful.
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NOTE ISSUE SUMMARY
This Note Issue Summary is expressly qualified by the entire Official Statement, including the Official Terms of Offering
and the Official Bid Form, which are provided for the convenience of potential investors and which should be reviewed in their
entirety by potential investors.
Issuer:
City of Boone, Boone County, Iowa.
Issue:
$6,915,000* General Obligation Capital Loan Notes, Series 2011.
Dated Date:
May 15, 2011.
Interest Due:
Each June 1 and December 1, commencing December 1, 2011.
Principal Due:
Serially each June 1, commencing June 1, 2012 through 2030, as detailed on the front page of this
Official Statement.
Optional Redemption:
Notes maturing on or after June 1, 2021, are callable at the option of the City on any date on or
after June 1, 2020, at a price of par plus accrued interest. See “OPTIONAL REDEMPTION”
herein.
Authorization:
The Notes are being issued pursuant to authority established in Code of Iowa, Chapter 384,
Division III, and all laws amendatory thereof and supplementary thereto, and the conformity with
a resolution of the City Council duly passed and approved.
Security:
The Notes are valid and legally binding obligations of the City payable both as to principal and
interest from ad valorem taxes levied against all taxable property therein without limitation as to
rate or amount, all except as limited by bankruptcy, insolvency, moratorium, reorganization and
other similar laws relating to the enforcement of creditors’ rights generally and except that
enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of
judicial discretion.
Investment Rating:
An investment rating for the Notes have been requested from Moody’s Investors Service. See
“INVESTMENT RATING” herein.
Purpose:
Note proceeds will be used to: (i) pay costs of improvements, extensions and equipping the
municipal sewer system; (ii) currently refund the City’s outstanding general obligation notes,
including Series 2002, 2003, 2003A, 2005, 2005A; and the City’s outstanding General Obligation
Capital Loan Note Anticipation Note, Series 2008; and (iii) pay the cost of issuance of the Notes.
See “PLAN OF FINANCING” herein.
Tax Matters:
Ahlers & Cooney, P.C., Des Moines, Iowa, will provide an opinion as to the tax exemption of the
Notes as discussed under “TAX MATTERS” in this Official Statement. Interest on the Notes is
not exempt from present State of Iowa income taxes. See APPENDIX D for a draft form of legal
opinion for the Notes.
Bank Qualification:
The City intends to designate the Notes as “qualified tax-exempt obligations.”
MATTERS – Qualified Tax Exempt Obligations” therein.
Registrar/Paying Agent:
Bankers Trust Company, of Des Moines, Iowa.
Book-Entry Form:
The Notes will be registered in the name of Cede & Co. as nominee for The Depository Trust
Company (“DTC”), New York, New York. DTC will act as securities depository of the Notes.
See APPENDIX B herein.
Delivery:
The Notes are expected to be delivered on or about May 18, 2011.
Financial Advisor:
Speer Financial, Inc., Waterloo, Iowa and Chicago, Illinois.
See “TAX
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CITY OF BOONE
Boone County, Iowa
John Slight
Mayor
City Council
Shari Gillespie
Greg Piklapp
Nick Mallas
Steven Ray
Gary Nystrom
Fenner Stevenson
Kevin Hicks
__________________________________
Officials
Luke Nelson
City Administrator
Ondrea Elmquist
Director of Finance
Alan Schroeder, Esq.
City Attorney
THE CITY
The City of Boone, Boone County, Iowa (the “City”) is the county seat of Boone County (the “County”). The
City is located in the center of the scenic Des Moines River Valley, approximately 45 miles from Des Moines, the State
capital. The City was once a small army camp, at various times called Boonesboro, Booneville, and Montana. By 1865, a
railroad through the City was completed, development intensified, and the City’s boundaries were formed. In 1871, a
petition was filed in the Circuit Court that changed the City’s name to Boone. The City and the County are named after
Captain Nathan Boone, the youngest son of the great pioneer, Daniel Boone.
According to the 2010 Census, the City’s population is 12,661. This is a slight decrease in City population from
12,803 in 2000.
City Organization and Services
The City operates under the home rule provisions of the Constitution of the State of Iowa. The City has a MayorCouncil form of government. The Mayor is elected to a two-year term and seven council members are elected to
staggered four-year terms. Policy is established by the Mayor and the City Council. The City Administrator, Director of
Finance and City Attorney are appointed by the City Council. The City Administrator also serves as the City Clerk. The
day-to-day operations of the City are the responsibility of the City Administrator.
Approximately 65 people are employed by the City on a full-time basis. The City considers its employee
relations to be good. The City’s Police are represented by the Police Bargaining Unit; the Fire Fighters by Local No. 678
of the International Association of Fire Fighters, and the Public Works Employees by the Public Works Employees
Bargaining Unit. The current Police contract expires on June 30, 2011 and a succeeding contract expires on June 30,
2014. The contract with the Public Works Employees expires on June 30, 2013 and the Fire Fighters contract does not
expire until June 30, 2013.
The City employs 17 full-time police officers and is served by 8 full-time firefighter, 5 part-time, 10 paid-on-call
and 13 cross-trained firefighters who operate out of one centrally located fire station. The fire insurance classification is
Class 6 within Boone and Class 6 in adjacent districts.
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The City’s water system provides water to City residents from shallow wells. The County runs the landfill and
residents contract with private haulers for garbage removal. Electric power and natural gas are provided to City residents
by Alliant Energy. Telecommunication services are provided locally by Qwest Communications. Cable services are
provided by MediaCom and internet services by GalaxyLynx, Mediacom, and FBX.
The Central Iowa Expo site located 4 miles east of the City on Highway 17 and Highway 30 and is an important
site that is expected to generate tourism for years to come. This 600 acre site, which included 106 acres of exhibit area,
will be the biennial host to the National Farm Progress Show beginning in August 2008 and to be held at this location on
alternate years for the next twenty years. Additionally, planners are designing this facility to host many other types of
attractions and shows at other times. It is considered to be one of the most important economic development projects in
Boone County for many years. Funding to complete this project is estimated to be approximately $8.5 million to be paid
by the County. Over 240,000 visitors are expected to attend each three day Farm Progress Show.
Transportation
City residents have easy access to various State and U. S. Highways, all of which cross the City or are within
approximately 10 miles of the City, as follows: north, State Highway 175; south, U. S. Highway 30; east, State Highway
17; and west, U. S. Highway 169.
The Union Pacific Railroad provides the City with freight rail service, including piggyback ramp facilities and
one day switching service.
Within 45 minutes of the City is the Des Moines International Airport which is served by the following passenger
and freight airlines: Allegiant Air, American; Comair – Delta Connections; Continental Express, Midwest Airlines,
Northwest; United; USAirways, Airborne Express/DHL, Federal Express, United Parcel Service and United States Postal
Service.
Community Life
The Ericson Public Library was built in 1901 and was placed in the National Register of Historic Places in 1983.
It houses a collection of 87,000 items, including local history and genealogy materials.
Approximately 300 acres in the City have been dedicated to 14 parks, the largest of which is McHose Park.
Located in the southwestern part of the City, McHose Park provides approximately 200 acres of timber and recreational
space. The municipal swimming pool is located in McHose Park as well as three baseball diamonds, six tennis courts and
various other playing fields, playgrounds and picnic shelters.
Ledges State Park, just south of the City, offers a variety of recreational activities. The Des Moines River, Pease
Creek and Davis Creek all weave in and around Ledges State Park, providing scenic attractions for visitors and tourists.
The Kate Shelly Bridge was built in 1901 and is reportedly the longest and highest double track railroad bridge in
the world. The Bridge stands 135 feet above the Des Moines River and runs for 2,685 feet. Located three and one-half
miles northwest of the City, it is named for a young heroine who crossed the Des Moines River in the midst of a ferocious
storm to warn an oncoming train that the bridge was out.
Located between the City and the City of Ames is the Iowa Arboretum, which is a non-profit privately funded
facility. Founded in 1967, the Arboretum is located on approximately 380 acres nine miles south of the City. Within the
Arboretum is a 40-acre “Library of Living Plants” containing hundreds of species of trees, shrubs and flowers. The
Arboretum also functions as an outdoor laboratory, a center for the preservation and propagation of rare and endangered
plant species and a meeting center for horticultural and conservation organizations.
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The Boone County Cultural Center and Historical Museum is listed on the National Historic Register of Historic
Places and is located in the City. The Center is a multi-purpose facility. It serves as a museum for valuable collections of
Boone County natural history and historical artifacts. It also serves City and County residents as a cultural and
community center where businesses, individuals and civic groups can gather for meetings, special programs and social
events.
The Boone & Scenic Valley Railroad is a unique railroad attraction in the City. It is the result of private
endeavors, including donations from the City’s approximately 2,250 charter member Boone Railroad Historical Society.
In 1989, the Railroad purchased a Chinese Steam Locomotive, the first one ever imported into the United States and the
only engine of its class in the United States. Over 50,000 people ride the Railroad annually.
In 1900 the first hospital in Boone County was built at the present site of the Boone County Hospital. Upgrades
and additions were added in 1940, 1956, 1968 and 2002. The Hospital operates both acute care and skilled nursing beds
and provides many other health services such as neurology, plastic surgery, radiology, respiratory care, 24 hour
emergency services and various laboratory services and testing.
Education
Public education is provided for City residents by the Boone Community School District (the “District”). The
District has five elementary schools, one middle school and one high school. The District has a combined 2010-201
enrollment of approximately 2,184. The City also has two elementary parochial schools.
Opportunities for continuing and higher education are provided for City residents at the Des Moines Area
Community College with campuses in Boone, Ankeny, Carroll, Newton and Des Moines; Iowa State University in Ames;
and the University of Osteopathic Medicine, Grandview College, Upper Iowa University and Drake University in Des
Moines.
CITY COMMERCIAL AND INDUSTRIAL DEVELOPMENT
Activity in industrial development in the City continues to be strong. Industrial development continues to expand
through development of local companies. Proliant has had recent growth as they released a human grade supplement for
health of the body’s immune system. Proliant added 10 new employees. Midland Bioproducts is working on an
expansion of their facility adding an estimated 12 employees. Patterson Dental incorporated additional shipment products
from their current facility while CDS Global expanded their local operation as part of a restructure of their Midwest
operations.
Commerce
The City’s business district (the “Business District”) is located on Story Street in downtown Boone. The Business
District is anchored by the national chain store HyVee. There is also various specialty retail stores located in the Business
District. Five financial institutions serve City residents as well as a daily newspaper. A Wal-Mart discount store is
located at the junction of Highway 30 and Story Street with anticipated plans of a new Super Wal-Mart Center at a new
location northeast of the intersection of Highway 30 and South Linn Street. City residents also have easy access to
commercial and retail facilities in the City of Ames, which is located only 14 miles from Boone and the City of Des
Moines, which is located only 45 miles from the City.
6
Boone Industrial Park
The City is active in economic development and community planning as seen through the development of the
Boone Industrial Park (the “Park”). The City completed infrastructure improvements on three sites in the Park in 1994.
Site B has approximately 10 acres available and it is not the City’s intention to develop it into a tax increment district.
Sites C and D have approximately 50 acres available and are located in tax increment areas of the Park. . The City also
expanded further development opportunities on Eastgate Drive. The development is call The RL Fisher Airport Business
Park and is conveniently located next to the Boone Municipal Airport. The development has over 35 acres of available
land. Some key features include: Joint storm water detention; Immediate access to Highway 30 (close to Interstate 35);
Immediate access to the Boone Municipal Airport; Water/Sewer/Data/Electricity/Gas/Phone. The Industrial Park
northeast of Boone has had extensive expansion by Fareway in the form of two large refrigerated storage buildings with a
combined value exceeding $10 million. In addition, PDM moved a facility to Boone from Des Moines and now uses the
Boone and Scenic Valley Railroad for rail access as part of their food-grade oil operation.
SOCIOECONOMIC INFORMATION
The following demographic information is for the City. Additional comparisons are made with Boone County
(the “County”) and the State of Iowa (the “State”).
Employment
Following are lists of certain major employers located in the City.
Major City Employers(1)
Approximate
Name
Business or Product
Employment
Iowa National Guard ...................................................................... Civil Defense .......................................................................................
450
Union Pacific Railroad ................................................................... Railroad ...............................................................................................
450
Boone County Hospital .................................................................. General Hospital ..................................................................................
430
Communication Data Services....................................................... Magazine Billing Services ....................................................................
370
Boone Community School District ................................................. Education Services ..............................................................................
370
Fareway Food Stores .................................................................... Company Headquarters and Warehousing ..........................................
320
Hy-Vee Food Stores ...................................................................... Grocery-Retail .....................................................................................
175
Gates Corporation. ........................................................................ Coupled Hydraulic Hose Assemblies ...................................................
160
Eastern Star Home ........................................................................ Care Facility.........................................................................................
155
Quinn Machinery & Foundry Corporation ....................................... Iron Castings, Forms and Machinery....................................................
150
Boone County Government ........................................................... Government Services ..........................................................................
135
Evangelical Free Church Home ..................................................... Nursing Home......................................................................................
125
Note:
(1)
Source: Boone Area Chamber of Commerce, Iowa Manufacturers 2011 Directory and a selected telephone survey.
7
The following tables show employment by industry and by occupation for the City, the County and the State as
reported by the 2000 Census.
Employment By Industry(1)
Classification
Agriculture, forestry, fishing and hunting, and mining .........................
Construction ......................................................................................
Manufacturing....................................................................................
Wholesale trade ................................................................................
Retail trade ........................................................................................
Transportation and warehousing, and utilities ....................................
Information ........................................................................................
Finance, insurance, real estate and rental and leasing ......................
Professional, scientific, management, administrative, and
Waste management services...........................................................
Education, health and social services ................................................
Arts, entertainment, recreation, accommodation and food services ...
Other services ...................................................................................
Public administration .........................................................................
Total ................................................................................................
Note:
(1)
The City
Number Percent
121
1.82%
583
8.78%
705
10.62%
220
3.31%
1,130
17.02%
323
4.86%
187
2.82%
252
3.80%
372
1,730
406
364
247
6,640
The County
Number
Percent
642
4.71%
1,117
8.20%
1,395
10.24%
409
3.00%
1,903
13.97%
827
6.07%
342
2.51%
616
4.52%
5.60%
26.05%
6.11%
5.48%
3.72%
100.00%
754
3,510
759
710
635
13,619
State of Iowa
Number Percent
65,903
4.42%
91,824
6.16%
253,444 17.01%
53,267
3.58%
179,381 12.04%
73,170
4.91%
41,970
2.82%
100,395
6.74%
5.54%
25.77%
5.57%
5.21%
4.66%
100.00%
90,157
6.05%
324,142 21.76%
98,819
6.63%
66,286
4.45%
51,058
3.43%
1,489,816 100.00%
Source: U. S. Census Bureau.
Employment By Occupation(1)
The City
Classification
Number
Percent
Management, professional, and related occupations ............... 1,562
23.52%
Service occupations ................................................................ 1,341
20.20%
Sales and office occupations ................................................... 1,842
27.74%
Farming, fishing, and forestry occupations ...............................
27
0.41%
Construction, extraction, and maintenance occupations ..........
796
11.99%
Production, transportation, and material moving occupations .. 1,072
16.14%
Total ...................................................................................... 6,640
100.00%
Note:
(1)
The County
Number
Percent
3,721
27.32%
2,373
17.42%
3,517
25.82%
214
1.57%
1,584
11.63%
2,210
16.23%
13,619
100.00%
State of Iowa
Number
Percent
466,436
31.31%
219,837
14.76%
385,794
25.90%
15,877
1.07%
132,530
8.90%
269,342
18.08%
1,489,816 100.00%
Source: U. S. Census Bureau.
Annual Average Unemployment Rates(1)
Calendar
The
Year
County
2000...................................................................
2.9%
2001...................................................................
2.7%
2002...................................................................
3.1%
2003...................................................................
3.4%
2004...................................................................
3.6%
2005...................................................................
3.7%
2006...................................................................
3.0%
2007...................................................................
3.3%
2008...................................................................
3.7%
2009...................................................................
5.5%
2010...................................................................
6.2%
2011(2) ..............................................................
6.0%
Notes:
(1)
(2)
Source: Iowa Workforce Development.
Through January 2011.
8
State of
Iowa
2.8%
3.3%
3.9%
4.4%
4.7%
4.3%
3.7%
3.7%
4.4%
6.0%
6.7%
6.1%
United
States
4.0%
5.3%
5.8%
6.0%
5.5%
5.1%
4.6%
4.6%
5.8%
9.3%
9.6%
9.0%
Boone County Non-Agricultural Wage and Salary Employment
By Place of Work(1)
Goods Producing ...................................................................
Service Producing .................................................................
Government...........................................................................
Total ....................................................................................
Note:
(1)
2006
1,520
6,040
2,490
10,050
2007
1,490
6,020
2,510
10,020
2008
1,540
5,910
2,560
10,010
2009
1,250
5,890
2,560
9,700
2010
1,160
5,730
2,470
9,360
Source: Iowa Workforce Development. Place of Work concept counts an individual in the area where he or she
works regardless of where that person lives.
Building Permits
Building permits have averaged approximately $8,467,711 annually over the last five fiscal years in the City,
excluding the value of land.
City Building Permits(1)
(Excludes the Value of Land)
Fiscal
Year
Number
2001 ...............................
263
2002 ...............................
283
2003 ...............................
248
2004 ...............................
228
2005 ...............................
270
2006 ...............................
309
2007 ...............................
256
2008 ...............................
173
2009 ...............................
245
2010 ...............................
225
Note:
(1)
Total Value
$11,972,951
12,120,393
7,201,082
21,764,150
7,324,078
8,590,337
10,373,299
5,831,383
11,071,582
6,471,958
Source: The City.
The 2000 Census reported that the median value of the City’s owner-occupied homes was $67,400, which
compares with $74,900 for the County and $82,500 for the State. The 2000 market value of specified owner-occupied
units for the City, Boone County and the State was as follows:
Specified Owner-Occupied Units(1)
The City
Value
Number
Percent
Under $50,000 ........................
906
27.04%
$ 50,000 to $ 99,999 ............. 1,731
51.67%
$100,000 to $149,999 .............
510
15.22%
$150,000 to $199,999 .............
115
3.43%
$200,000 to $299,999 .............
80
2.39%
$300,000 to $499,999 .............
8
0.24%
$500,000 to $999,999 .............
0
0.00%
$1,000,000 or more.................
0
0.00%
Total ..................................... 3,350
100.00%
Note:
(1)
The County
Number
Percent
1,460
23.59%
2,934
47.40%
1,113
17.98%
409
6.61%
241
3.89%
33
0.53%
0
0.00%
0
0.00%
6,190
100.00%
Source: U.S. Census Bureau.
9
State of Iowa
Number
Percent
135,833
20.41%
301,591
45.32%
134,212
20.17%
53,228
8.00%
29,483
4.43%
8,938
1.34%
1,743
0.26%
414
0.06%
665,442
100.00%
According to the 2000 Census, the City had a median household income of $38,179. This compares to $40,763
for the County and $39,469 for the State. The following table represents the distribution of household incomes for the
City, Boone County and the State at the time of the 2000 Census.
Household Income(1)
The City
Income
Number
Percent
Under $10,000 ........................
504
9.43%
$ 10,000 to $ 14,999 .............
427
7.99%
$ 15,000 to $ 24,999 .............
774
14.49%
$ 25,000 to $ 34,999 .............
759
14.21%
$ 35,000 to $ 49,999 .............
1,011
18.92%
$ 50,000 to $ 74,999 .............
1,265
23.68%
$ 75,000 to $ 99,999 .............
339
6.34%
$100,000 to $149,999 .............
182
3.41%
$150,000 to $199,999 .............
46
0.86%
$200,000 or more ...................
36
0.67%
Total ...................................
5,343
100.00%
Note:
(1)
The County
Number
Percent
786
7.55%
644
6.18%
1,367
13.13%
1,556
14.94%
2,065
19.83%
2,526
24.25%
846
8.12%
423
4.06%
110
1.06%
92
0.88%
10,415
100.00%
State of Iowa
Number
Percent
93,783
8.15%
77,333
6.72%
165,122
14.36%
168,713
14.67%
218,204
18.97%
242,022
21.04%
101,287
8.81%
55,998
4.87%
12,879
1.12%
14,856
1.29%
1,150,197
100.00%
Source: U.S. Census Bureau.
Retail Sales
The Department of Revenue of the State of Iowa provides retail sales figures based on sales tax reports for years
ending March 31. The Department of Revenue figures provide recent data to confirm trends in retail sales activity in the
City.
Retail Taxable Sales(1)
Year
Ending March 31
Taxable Sales
2001 .......................................................... $129,910,464
2002 .......................................................... 130,697,849
2003 .......................................................... 136,657,408
2004 .......................................................... 149,829,039
2005 .......................................................... 154,134,353
2006 .......................................................... 154,680,440
2007 .......................................................... 151,630,447
2008 .......................................................... 144,426,063
2009(3) ...................................................... 139,482,276
2010(3) ...................................................... 135,642,695
Annual Percent
Change + (-)
0.46%
0.61%
4.56%
9.64%
2.87%
0.35%
(1.97%)
(4.75%
(3.42%)
(2.75%)
Growth from 2001 to 2010 .................................................................................. 4.41%
Notes:
(1)
(2)
(3)
Source: the Iowa Department of Revenue and Finance.
Based on a 2000 taxable sales of $129,309,576.
Beginning in fiscal year 2009 the numbers reflect a fiscal year ending June 30th instead
of March 31st, as previously reported.
LOCAL OPTION SALES TAX
The City approved a 1% local option sales and service tax (“Local Option Tax”) at a special referendum. The
Local Option Tax for the City became effective 1991 with actual tax monies received in the City’s 1991 fiscal year. The
City’s Local Option Tax referendum question stated that proceeds of such tax would be designated 5% for Human
Services; 20% property tax relief; and 75% for capital projects.
The City has historically used its Local Option Tax receipts for the abatement of debt service on a portion of its
general obligation debt. See “DEBT INFORMATION” herein. The City does plan to abate a portion of its annual debt
service on the Notes from its Local Option Tax receipts.
10
Once approved, a Local Option Tax can only be repealed through a public referendum at which a majority voting
approve the repeal or tax rate change. Contiguous municipalities are one unit for this purpose. If a Local Option Tax is
not imposed county-wide, then the question of repeal is voted upon only by voters in such areas of a county where the tax
has been imposed. A Local Option Tax may not be repealed within one year of the effective date.
The State of Iowa Department of Revenue and Finance (the “Department”) administers collection and
disbursement of all local option sales and services taxes in conjunction with administration of the State-wide sales,
services and use tax presently assessed at 5%. The Department is required by statute to remit at least 95% of the
estimated tax receipts to a county board of supervisors (for taxes imposed in unincorporated areas) and to each
incorporated city. Such remittances are on a monthly basis. Once a year the Department reconciles its estimated
payments and makes an adjustment payment or debit at the November 10 payment date. Remittance of collections within
a county are based upon the following statutory formula for county-wide collections:
75 percent:
Based on a pro rata share of population (the most recent certified federal census) of those
incorporated or unincorporated areas in a county which have approved a Local Option Tax.
25 percent:
Based on a pro rata share of total property tax dollars levied during the three year period
beginning July 1, 1982, through June 30, 1985, for those incorporated or unincorporated areas of
a county which have approved a Local Option Tax.
Local Option Taxes are based on the same sales currently taxed by the state-wide 5% sales and services tax, with
the present statutory exceptions of use taxes, lottery tickets, motor fuel and special fuels, certain farm machinery,
industrial equipment, and the sale of automobiles, room rental already subject to a hotel/motel tax, or natural gas or
electricity already subject to a city or county franchise fee or user fee.
The following table shows the trend of City sales tax receipts.
Local Option Tax Receipts(1)
Local
Fiscal Year
Option Tax
Ending June 30
Receipts
2000-01................................ $728,401
2001-02................................ 730,233
2002-03................................ 760,920
2003-04................................ 894,117
2004-05................................ 859,586
2005-06................................ 873,064
2006-07................................ 966,293
2007-08................................ 976,640
2008-09................................ 961,811
2009-10................................ 957,617
2010-11................................ 635,894(3)
Notes:
(1)
(2)
(3)
Percent
Change
(7.99%)(2)
0.25%
4.20%
17.50%
(3.86%)
1.57%
10.68%
1.07%
(1.52%)
(0.44%)
N/A
Source: the City.
Percent change based on 1999-2000 Local Option Tax
Receipt of $791,625.
Local Option Sales Tax receipts collected through February
2011.
11
PLAN OF FINANCING
Approximately $2,160,000 in proceeds of the Notes will be used to currently refund certain outstanding general
obligation notes of the City (the “Refunded Notes”). The Refunded Notes are described below.
(Originally dated July 1, 2002)
Refunded
Outstanding
Maturities
Amount
6/1/11 .......................... $265,000
6/1/12 .......................... 275,000
Note:
(1)
Amount
Refunded(1)
$
0
275,000
Redemption
Price
n/a
100%
Maturity or
Redemption
Date(1)
06/01/11
06/01/11
Subject to Change
(Originally dated January 1, 2003)
Refunded
Outstanding
Maturities
Amount
6/1/11 .......................... $225,000
6/1/12 .......................... 230,000
6/1/13 .......................... 240,000
Note:
(1)
Amount
Refunded(1)
$
0
230,000
240,000
Redemption
Price
n/a
100%
100%
Maturity or
Redemption
Date(1)
06/01/11
06/01/11
06/01/11
Subject to Change
General Obligation Capital Loan Notes, Series 2003A
(Originally dated October 1, 2003)
Refunded
Outstanding
Maturities
Amount
6/1/11 .......................... $205,000
6/1/12 .......................... 215,000
6/1/13 .......................... 220,000
6/1/14 .......................... 230,000
6/1/15 .......................... 235,000
6/1/16 .......................... 245,000
Note:
(1)
Amount
Refunded(1)
$
0
215,000
220,000
230,000
235,000
245,000
Redemption
Price
n/a
100%
100%
100%
100%
100%
Maturity or
Redemption
Date(1)
06/01/11
06/01/11
06/01/11
06/01/11
06/01/11
06/01/11
Subject to Change
(Originally dated March 1, 2005)
Refunded
Outstanding
Maturities
Amount
6/1/11 .......................... $210,000
6/1/12 ..........................
45,000
6/1/13 ..........................
45,000
6/1/14 ..........................
50,000
6/1/15 ..........................
55,000
Note:
(1)
Amount
Refunded(1)
$
0
45,000
45,000
50,000
55,000
Subject to Change
12
Redemption
Price
n/a
100%
100%
100%
100%
Maturity or
Redemption
Date(1)
06/01/11
06/01/11
06/01/11
06/01/11
06/01/11
General Obligation Capital Loan Notes, Series 2005A
(Originally dated October 1, 2005)
Refunded
Outstanding
Maturities
Amount
6/1/11 .......................... $35,000
6/1/12 ..........................
35,000
6/1/13 ..........................
35,000
Note:
(1)
Amount
Refunded(1)
$
0
35,000
35,000
Redemption
Price
n/a
100%
100%
Maturity or
Redemption
Date(1)
06/01/11
04/01/11
04/01/11
Subject to Change
Approximately $3,000,000 of the Note proceeds will refinance the City’s outstanding General Obligation Capital
Loan Anticipation Note, Series 2008 (the “Refinanced 2008 Note”) with permanent financing. The 2008 Note is expected
to be redeemed at a redemption price of $3,000,000 on a redemption date of June 1, 2011. The remaining $1,755,000 will
finance certain capital improvements in the City (the “Projects”) and pay the costs of issuance of the Notes. The Projects
include improvements, extensions and equipping of the municipal sewer system, including SCADA improvements, Trunk
Sewer Phase IIIB, NE Sanitary Sewer Drainage District improvements and grit removal system improvements.
DEBT INFORMATION
After issuance of the Notes and refunding the Refunded Notes, the City will have outstanding $18,600,000*
aggregate principal amount of general obligation bonded indebtedness. Of the $18,600,000* principal amount,
approximately $3,000,000 is expected to be paid in full on June 1, 2011. The City also has outstanding $3,765,000 in
principal amount of water revenue notes, $10,159,000 outstanding principal in state revolving fund sewer bonds and
$195,000 outstanding principal in state revolving water bonds. The City does not expect to issue any other additional
bonded indebtedness in the foreseeable future.
The City has a constitutional general obligation debt limit equal to 5% of Actual Valuation. For the January 1,
2009 levy year, the adjusted Actual Valuation of $607,948,806 (including tax increment valuation and excluding military
exemption valuation) results in a total debt limit of $30,397,440. This limitation less the City’s outstanding general
obligation indebtedness leaves a general obligation debt margin of $14,797,440*.
General Obligation Debt Summary(1)
(Principal Only)
General Obligation Bonds:
Series 2008....................................................................................................... $ 3,995,000
General Obligation Loan Notes:
Series 2002.......................................................................................................
Series 2003.......................................................................................................
Series 2003A ....................................................................................................
Series 2005.......................................................................................................
Series 2005A ....................................................................................................
Series 2006.......................................................................................................
540,000
700,000
1,350,000
405,000
105,000
3,750,000
General Obligation Bond Anticipation Notes:
Series 2008.......................................................................................................
3,000,000(2)
The Notes(3) ....................................................................................................... 6,915,000
Less: the Refunded Notes(3)............................................................................... (2,160,000)
Less: the Refinanced 2008 Note ......................................................................... (3,000,000)
Total General Obligation Debt(3)......................................................................... $15,600,000
Note:
(1)
(2)
(3)
Source: The City.
Redeemed by the Notes on June 1, 2011.
Subject to change.
*Subject to change.
13
City Outstanding Bonded Debt(1)
(Principal Only)
Fiscal
Year
Total
Ending
Outstanding
June 30
Notes & Bonds
2011 ...................... $ 4,945,000
2012 ......................
1,850,000
2013 ......................
1,625,000
2014 ......................
1,405,000
2015 ......................
1,460,000
2016 ......................
1,460,000
2017 ......................
540,000
2018 ......................
560,000
2019 ......................
0
2020 ......................
0
2021 ......................
0
2022 ......................
0
2023 ......................
0
2024 ......................
0
2025 ......................
0
2026 ......................
0
2027 ......................
0
2028 ......................
0
2029 ......................
0
2030 ......................
0
Total .................... $13,845,000
Notes:
(1)
(2)
The
Notes(2)
$
0
830,000
760,000
480,000
485,000
450,000
215,000
220,000
225,000
235,000
245,000
255,000
265,000
280,000
290,000
300,000
320,000
335,000
355,000
370,000
$6,915,000
Less:
The Refunded
Notes(2)
$(3,000,000)
(805,000)
(540,000)
(280,000)
(290,000)
(245,000)
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$(5,160,000)
Total
Cumulative
Principal Retired(2)
Amount
Percent
$ 1,945,000
12.74%
3,820,000
24.49%
5,665,000
36.31%
7,270,000
46.60%
8,925,000
57.21%
10,590,000
67.88%
11,345,000
72.72%
12,125,000
77.72%
12,350,000
79.17%
12,585,000
80.67%
12,830,000
82.24%
13,085,000
83.88%
13,350,000
85.58%
13,630,000
87.37%
13,920,000
89.23%
14,220,000
91.15%
14,540,000
93.21%
14,875,000
95.35%
15,230,000
97.63%
15,600,000
100.00%
Total
Debt(2)
$1,945,000
1,875,000
1,845,000
1,605,000
1,655,000
1,665,000
755,000
780,000
225,000
235,000
245,000
255,000
265,000
280,000
290,000
300,000
320,000
335,000
355,000
370,000
$15,600,000
Source: the City.
Subject to change
Statement of General Obligation Bonded Indebtedness
(As of March 16, 2011)
City Actual Value, January 1, 2009 .........................................................................................................................
City Taxable Value, January 1, 2009 ......................................................................................................................
Total
Direct Debt(2) .......................................... $15,600,000
Applicable
Percent
Amount
100.00% $15,600,000
Overlapping Debt:
Boone County.......................................... $4,105,000
29.57%
$1,213,849
Boone Community School District............
9,465,000
75.89%
7,182,989
Des Moines Areas Community College.... 10,830,000
30.09%
3,258,747
Total Direct and Overlapping Debt(2)............................................... $30,255,585
$609,591,530
$342,484,784
Ratio to City
Actual Value
2.56%
Ratio to City
Taxable Value
4.55%
0.20%
1.18%
0.53%
4.96%
0.35%
2.10%
0.95%
8.83%
Per Capita
(2010 Pop.
12,661)
$1,232.13
$
95.87
567.33
257.38
$2,152.72
Per Capita Actual Value................................................................................................................................................ $48,147.19
Per Capita Taxable Value ............................................................................................................................................. $27,050.37
Notes:
(1)
(2)
Source: The City, County, Boone School District and Des Moines Area Community College.
Subject to change.
*Subject to change.
PROPERTY TAX INFORMATION
Property Tax Assessment
In compliance with Section 441.21 of the Code of Iowa, as amended, the State Director of Revenue annually
directs all county auditors to apply prescribed statutory percentages to the assessments of certain categories of real
property. The final values, called Actual Valuation, are then adjusted by the County Auditor. Taxable Valuation subject
to tax levy is then determined by the application of State determined rollback percentages, principally to residential
property.
14
Beginning in 1978, the State required a reduction in Actual Valuation to reduce the impact of inflation on its
residents. The resulting value is defined as the Taxable Valuation. Such rollback percentages may be changed in future
years. Certain historical rollback percentages for residential valuation are as follows:
Rollback Percentages for Residential Taxable Valuation(1)
Fiscal Year
Percentage
2002/03 ................................................... 51.6676%
2003/04 ................................................... 51.3874%
2004/05 ................................................... 48.4558%
2005/06 ................................................... 47.9642%
2006/07 ................................................... 45.9960%
2007/08 ................................................... 45.5596%
2008/09 ................................................... 44.0803%
2009/10 ................................................... 45.5893%
2010/11 ................................................... 46.9094%
2011/12 ................................................... 48.5299%
Note: (1)
Source: the City.
Property is assessed on a calendar year basis. The assessments finalized as of January 1 of each year are applied
to the following tax year. For example, the assessments finalized on January 1, 2009, are used to calculate tax liability for
the tax year starting July 1, 2010 through June 30, 2011.
Property Tax Collection
Each county is required by State law to collect all tax levies within its jurisdiction and remit, before the fifteenth
of each month, the amount collected through the last day of the preceding month to underlying units of government,
including the City. Property tax payments are made at the office of each county treasurer in full or one-half by September
30 and March 31, pursuant to the Code of Iowa, Sections 445.36 and 445.37. Where the first half of any property tax has
not been paid by October 1, such installment becomes delinquent. If the second installment is not paid, it becomes
delinquent on April 1. Delinquent taxes and special assessments are subject to a penalty at the rate of one and one-half
percent per month, to a maximum of eighteen percent per annum.
If taxes are not paid when due, the property may be offered at the regular tax sale on the third Wednesday of June
following the delinquency date. Purchasers at the tax sale must pay an amount equal to the taxes, special assessments,
interest and penalties due on the property, and funds so received are applied to the payment of taxes. A property owner
may redeem from the regular tax sale, but failing redemption within two years, the tax sale purchaser is entitled to a deed
which in general conveys the title free and clear of all liens except future installments of taxes.
Actual (100%) Valuations for the City(1)
Fiscal Year:
2006/07
Property Class
Levy Year January 1:
2005
Residential ............................................................ $423,350,675
Agricultural ............................................................
1,841,667
Commercial ........................................................... 77,636,947
Industrial ...............................................................
2,120,584
Railroad .................................................................
742,722
Utilities without Gas and Electric(3) .......................
2,873,124
Gas and Electric Utilities(3) ...................................
19,311,367
Total Valuation (Without TIF) ............................... $527,877,086
Tax Increment Finance (TIF) Valuation.................. 22,954,287
Total Valuation (With TIF) .................................... $550,831,373
Percent Change +(-) ............................................
15.37%(2)
Notes:
(1)
(2)
(3)
2007/08
2006
$434,006,177
1,797,695
78,751,298
2,120,584
745,050
2,288,983
19,201,433
$538,911,220
22,112,035
$561,023,255
1.85%
2008/09
2007
$462,144,042
2,116,931
79,468,955
2,120,584
836,062
2,303,304
18,542,116
$565,837,414
21,064,396
$586,901,810
4.61%
Source: Iowa Department of Management.
Based on 2004 Actual Valuation of $527,877,086.
See “PROPERTY TAX INFORMATION - Utility Property Tax Replacement” herein.
15
2009/10
2008
$470,350,529
2,086,876
81,834,510
2,246,745
854,110
2,276,727
19,350,630
$579,000,127
19,181,741
$598,181,868
1.92%
2010/11
2009
$478,044,923
3,201,400
89,235,233
15,470,897
985,175
2,371,079
21,925,547
$587,429,740
22,161,790
$609,591,530
1.91%
For the 2009 levy year, the City’s Taxable Valuation was comprised of approximately 65% residential, 5%
industrial, 26% commercial, 3% utilities and railroad and less than 1% agricultural and military exemption.
Taxable (“Rollback”) Valuations for the City(1)
Fiscal Year:
2006/07
Property Class
Levy Year January 1:
2005
Residential ............................................................ $194,724,735
Agricultural ............................................................
1,841,667
Commercial ........................................................... 76,892,659
Industrial ...............................................................
2,120,584
Railroad .................................................................
736,416
Utilities without Gas and Electric(3) .......................
2,873,124
Gas and Electric Utilities(3) ................................... 12,269,395
Less: Military Exemption .......................................
(1,642,724)
Total Valuation (Without TIF) ............................... $289,815,856
Tax Increment Finance (TIF) Valuation.................. 22,954,287
Total Valuation (With TIF) .................................... $312,770,143
Percent Change +(-) ............................................
9.85%(2)
Notes:
(1)
(2)
(3)
2007/08
2006
$197,731,552
1,797,695
78,751,298
2,120,584
745,050
2,288,983
11,798,811
(1,718,656)
$293,515,317
22,112,035
$315,627,352
0.91%
2008/09
2007
$203,714,370
1,907,402
79,231,360
2,120,584
833,814
2,303,304
12,093,621
(1,694,580)
$298,815,295
21,064,396
$321,574,271
1.88%
2009/10
2008
$214,429,594
1,958,676
81,892,495
2,246,745
854,110
2,276,727
10,920,049
(1,674,208)
$312,904,188
19,181,741
$332,085,929
3.27%
2010/11
2009
$224,247,636
2,088,975
89,235,233
15,470,897
985,175
2,371,079
9,728,513
(1,642,724)
$320,322,994
22,161,790
$342,484,784
3.13%
Source: Iowa Department of Management.
Based on 2004 Actual Valuation of $284,719,696.
See “PROPERTY TAX INFORMATION - Utility Property Tax Replacement” herein.
The following shows the trend in the City’s tax extensions and collections.
Tax Extensions and Collections(1)(2)
Levy
Fiscal
Amount
Year
Year
Levied
1999....................... 2000-01 .................. $2,854,743
2000....................... 2001-02 .................. 3,297,765
2001....................... 2002-03 .................. 3,864,905
2002....................... 2003-04 .................. 3,871,666
2003....................... 2004-05 .................. 3,805,766
2004....................... 2005-06 .................. 3,655,175
2005....................... 2006-07 .................. 4,325,419
2006....................... 2007-08 .................. 4,630,285
2007....................... 2008-09 .................. 4,582,630
2008....................... 2009-10 .................. 4,762,814
2009....................... 2010-11 .................. 4,859,084
Notes:
(1)
(2)
Amount
Percent
Collected(2)
Collected
$2,902,519
101.67%
3,341,945
101.34%
3,860,915
99.90%
3,833,421
99.01%
3,796,309
99.75%
3,685,445
100.83%
4,521,667
104.54%
4,595,454
99.25%
4,322,710
94.33%
4,884,178
102.34%
--In Collection--
Source: The County.
Does not include levies and collections for the City’s tax increment finance
districts.
Principal Taxpayers(1)
Fiscal Year
2010/11 Taxable
Taxpayer Name
Business/Service
Valuation(2)
Interstate Power & Light Co. .................................................. Utility...................................................................... $8,783,434
Patterson Logistic Service, Inc. .............................................. Dental Supply ........................................................ $ 3,784,610
Forselles II Partners............................................................... Real Estate ............................................................ 3,155,545
Community Bank of Boone .................................................... Financial Institution ................................................ 3,093,709
Boone Eleven Cousins, LLC (Wal-Mart)................................. Real Estate ............................................................ 2,724,024
Hy-Vee Inc............................................................................. Grocery Store ........................................................ 2,599,485
Composite Technologies ....................................................... Technology ............................................................ 2,350,000
Qwest Corporation ................................................................. Telephone Utility .................................................... 2,275,911
Redeker Furniture Store ........................................................ Retail ..................................................................... 2,242,628
International Pipe Mach Corp................................................. Manufacturing ........................................................ 2,206,204
Moffitts Inc. ............................................................................ Car Dealership ....................................................... 1,806,010
Total ................................................................................................................................................................... $35,021,560
Ten Largest Taxpayers as Percent of City’s Taxable 2010/11 Taxable Valuation ($342,484,784) .......................
10.23%
Notes:
(1)
(2)
Source: The County.
Every effort has been made to seek out and report the largest taxpayers. However, many of the taxpayers
listed contain multiple parcels and it is possible that some parcels and their valuations have been overlooked.
16
Levy Limits
Normal municipal operations and maintenance costs are generally funded through the corporate property tax levy.
Iowa State Code does not allow the municipal general fund to be taxed above $8.10 per thousand dollars of taxable value
in any one year. In addition to the General Fund, there are several other tax funds that the City can create and use for
specific purposes.
The property tax rates for the City from levy year 2005 through levy year 2009 are shown below:
Property Tax Rates: Levy Years 2005 – 2009 (1)(2)
(Per $1,000 Actual Valuation)
Fiscal Year:
Levy Year:
2006/07
2005
2007/08
2006
2008/09
2007
2009/10
2008
2010/11
2009
The City:
General Fund .....................................................
Debt Service ......................................................
Pension and Benefits .........................................
Others ................................................................
Total City Rate .................................................
$ 8.10000
1.40086
5.49078
0.56017
$15.55181
$ 8.10000
0.85422
6.07592
0.59566
$15.62580
$ 8.10000
0.33330
6.60435
0.58815
$15.62580
$ 8.10000
0.88934
5.99662
0.63984
$15.62580
$ 8.10000
1.45133
5.44310
0.63137
$15.62580
Others:
Boone County ....................................................
Boone Community School District ......................
Des Moines Area Community College ................
Other .................................................................
Total Rate Paid ................................................
$ 4.90894
17.97848
0.68688
1.64120
$40.76731
$ 5.34236
17.92497
0.60276
1.61262
$41.10851
$ 5.14749
18.06292
0.56386
1.55959
$40.95966
$ 5.22429
18.55059
0.56778
1.50215
$41.47061
$ 5.21405
18.87498
.56008
1.61138
$41.88629
Notes:
(1)
(2)
Source: The County.
Does not include the tax rate for agriculture.
Utility Property Tax Replacement
Beginning in 1999, the State replaced its previous property tax assessment procedure in valuing the property of
entities involved primarily in the production, delivery, service and sale of electricity and natural gas with a replacement
tax formula based upon the delivery of energy by these entities. Electric and natural gas utilities now pay replacement
taxes to the State in lieu of property taxes. All replacement taxes are allocated among local taxing districts by the State
Department of Revenue and Finance and the Department of Management. This allocation is made in accordance with a
general allocation formula developed by the Department of Management on the basis of general property tax equivalents.
Properties of these utilities are exempt from the levy of property tax by political subdivisions. Utility property will
continue to be valued by a special method as provided in the statute and taxed at the rate of three cents per one thousand
dollars for the general fund of the State. For the tax years following 1999, 2000, and 2001, each county treasurer
computed a special utility property tax levy and levied a special utility property tax equal to the shortfall. However, this
special tax was subject to a statutory sunset in 2002.
17
A task force was established through January 1, 2003 to study the effects of the utility replacement tax legislation
on all local taxing districts and to report its findings to the General Assembly. Currently the utility replacement tax statute
states that the utility replacement tax collected by the State and allocated among local taxing districts (including the City)
shall be treated as property tax when received and shall be disposed of by the county treasurer as taxes on real estate.
However, utility property is not subject to the levy of property tax by political subdivisions, only the utility replacement
tax and statewide property tax. It is possible that the general obligation debt capacity of the City could be adjudicated to
be proportionately reduced in future years if utility property were determined to be other than “taxable property” for
purposes of computing the City’s debt limit under Article XI of the Constitution of the State of Iowa. With the sunset of
the special utility property tax levy to make up for the short fall in the replacement tax revenue for specific taxing
districts, and pending any General Assembly action pursuant to the task force report and recommendations, there can be
no assurance that future legislation will not (i) operate to reduce the amount of debt the City can issue or (ii) adversely
affect the City’s ability to levy taxes in the future for the payment of the principal of and interest on its outstanding debt
obligations, including the Notes. Approximately 3% of the City’s tax base currently is utility property. Notwithstanding
the foregoing, the City has the obligation to levy taxes against all the taxable property in the City sufficient to pay
principal of and interest on the Notes.
Tax Increment Financing
The Code of Iowa currently authorizes the use of two types of tax increment financing by local taxing districts in
the State of Iowa. The first type allows local governments to establish TIF districts to be established for the purposes of
financing capital improvements constructed within the defined area which contribute to the urban redevelopment and
economic development of the immediate area. The City has three TIF districts of this type with a total certified taxable
valuation of $22,161,790 for levy year 2009.
The second type of tax increment financing was authorized by state legislative action in the mid-1980’s. The
area community colleges can establish TIF districts by contract with specific local businesses and industries to provide
jobs training programming for new employees of existing expanding businesses or employees of new businesses. The
revenues from these job training TIF districts then retires the debt incurred from the issuance of jobs training certificates
which finance the cost of jobs training programming over a maximum of ten years. Upon payment of all jobs training
certificates, the district dissolves and the incremental value from the new or expanded business reverts to the general tax
base.
FINANCIAL INFORMATION
Budgeting
The City Administrator presents the annual budget to the City Council for consideration. The Council holds
hearings with the public prior to the budget being adopted. By March 15, the adopted budget is certified to the County
Auditor who, in turn, certifies the City budget to the Iowa Department of Management.
Investment Policy
Each investment made by the City must be authorized by applicable law and the City’s Investment Policy (the
“Policy”). Only the City Treasurer and others authorized by resolution of the City may invest City funds. The City
Treasurer when investing or depositing public funds is required to exercise care, skill, prudence, and diligence.
18
According to the Policy, the primary objectives of all investment activities of the City are the following:
•
•
•
Safety. The safety and preservation of principal in the overall portfolio is the foremost investment objective.
Liquidity. Maintaining the necessary liquidity to match expected liabilities.
Return. Obtaining a reasonable return.
Under the Policy, assets of the City may be invested in the following:
•
•
•
•
•
•
•
Interest bearing savings accounts, interest bearing money market accounts and interest bearing checking
accounts at any bank, savings and loan association or credit union in the State of Iowa;
Obligations of the United States government, its agencies and instrumentalities;
Certificates of deposit and other evidences of deposit at federally insured Iowa depository institutions
approved and secured pursuant to Chapter 453 of the Iowa Code;
Iowa Public Agency Investment Trust (IPAIT);
Commercial paper or other short-term corporate debt that matures within 270 days of purchase and is rated
within the two highest classifications, as established by at least one of the standard rating services approved
by the superintendent of banking;
Repurchase agreements, provided that the underlying collateral consists of obligations of the United States
government, its agencies and instrumentalities and the City takes delivery of the collateral either directly or
through an authorized custodian; and
An open-end management investment company registered with the Securities & Exchange Commission
under the federal Investment Company Act of 1940, whose portfolio investments are limited to those
instruments individually authorized in the Policy.
Assets may not be invested in reverse repurchase agreements, futures and options. Assets of the City may not be
invested pursuant to the trading of securities for speculation or short term gains or pursuant to a contract providing for the
compensation of an agent or fiduciary based upon performance of invested assets.
Under the Policy, the City’s assets shall be diversified to eliminate the risk of loss resulting from over
concentration of assets in a specific maturity, a specific issuer or a specific class of securities. In addition to certain
constraints that apply solely to commercial paper and other short-term corporate debt, the following constraints apply:
•
•
•
Maturities shall be selected to provide stability of income and reasonable liquidity;
Liquidity practices shall ensure that disbursement dates and payroll dates are covered through maturing
investments, marketable U. S. Treasury bills or cash on hand shall be used at all times; and
Risks of market price volatility shall be controlled through maturity diversification so that aggregate price
losses on instruments with maturities approaching one year shall not be greater than coupon interest and
investment income received from the balance of the portfolio.
The City Treasurer is required to submit a quarterly investment report stating the current portfolio terms of
maturity, rates of return and other features summarizing all investment transactions that have occurred during the
reporting period. This report must also compare the investment result with budgetary expectations.
Financial Reports
The City’s financial statements are audited annually by certified public accountants. The City’s financial
statements are completed on a cash receipts and disbursements, which is a comprehensive basis of accounting other than
generally accepted accounting principles. See APPENDIX A for more detail.
19
No Consent or Updated Information Requested of the Auditor
The tables and excerpts (collectively, the “Excerpted Financial Information”) contained in this “FINANCIAL
INFORMATION” section and in APPENDIX A are from the audited financial statements of the City, including the
audited financial statements for the fiscal year ended June 30, 2010 (the “2010 Audit”). The 2010 Audit has been
prepared by Houston & Seeman, P.C., Certified Public Accountants, Boone, Iowa (the “Auditor”), and approved by
formal action of the City Council. The City has not requested the Auditor to update information contained in the
Excerpted Financial Information; nor has the City requested that the Auditor consent to the use of the Excerpted Financial
Information in this Official Statement. Other than as expressly set forth in this Official Statement, the financial
information contained in the Excerpted Financial Information has not been updated since the date of the 2010 Audit. The
inclusion of the Excerpted Financial Information in this Official Statement in and of itself is not intended to demonstrate
the fiscal condition of the City since the date of the 2010 Audit. Questions or inquiries relating to financial information of
the City since the date of the 2010 Audit should be directed to the City.
Summary Financial Information
The following tables are summaries and do not purport to be the complete audits, copies of which are available
upon request. The City has approved a balanced budget for the General Fund for fiscal year 2011. The City expects it’s
general fund balance to remain the same or increase slightly at the end of fiscal year 2011. The City certified a balanced
budget for fiscal year 2012, and does not plan to use any cash balances in that budget.
20
Statement of Activities and Net Assets – Cash Basis
Governmental Activities (1)
2006
Audited as of June 30
2008
2007
2009
2010
FUNCTIONS/PROGRAMS
Governmental Activities:
Public Safety ............................................................... $(3,258,529)
Public Works ...............................................................
(356,776)
Health and Social Services ..........................................
(40,000)
Culture and Recreation................................................ (1,060,692)
Community and Economic Development .....................
(275,411)
General Government ...................................................
(711,048)
Debt Service................................................................ (2,232,387)
Capital Projects ........................................................... (2,023,186)
Total Governmental Activities ........................................ $(9,958,029)
$ (3,003,308)
(610,308)
(44,516)
(1,104,625)
(487,911)
(557,730)
(4,051,421)
(3,789,360)
$(13,649,179)
$(3,138,753)
(456,540)
(41,862)
(999,077)
(425,491)
(547,109)
(2,444,413))
(3,643,851)
$(11,697,096)
$ (2,694,746)
(388,431)
(50,888)
(951,581)
(245,730)
(596,029)
(2,124,799)
(6,205,655)
$(13,257,859)
$ (2,901,624)
(303,025)
(47,650)
(1,047,123)
(924,040)
(633,894)
(2,340,887)
(6,251,712)
$(14,449,955)
GENERAL RECEIPTS
Property Tax Levied for:
General Purposes .....................................................
Tax Increment Financing ...........................................
Debt Service..............................................................
Special Assessments ................................................
Property Tax Replacement ..........................................
Local Option Sales Tax ...............................................
Hotel/Motel Tax ...........................................................
Franchise Taxes ..........................................................
Unrestricted Investment Earnings ................................
Bond Proceeds ............................................................
Bond Good Faith Deposit ............................................
Miscellaneous .............................................................
Sale of Assets .............................................................
Transfers .....................................................................
Total General Receipts and Transfers ...........................
$3,464,833
1,200,875
395,690
146,013
0
873,064
125,766
152,126
70,083
233,063
116,800
636,395
1,262
281,382
$7,698,072
$ 3,982,186
890,451
435,876
116,018
0
966,291
117,058
177,062
108,984
5,952,244
0
652,113
125,000
363,050
$13,886,333
$ 4,215,451
887,670
269,917
191,568
0
976,428
129,542
158,501
107,196
4,921,038
0
439,543
0
330,420
$ 12,627,274
$ 4,524,853
921,749
109,100
98,777
0
1,004,222
132,326
174,048
103,557
3,878,305
0
410,881
0
353,736
$11,711,554
$ 4,504,355
847,236
290,603
94,365
0
934,432
107,614
140,420
52,947
6,958,621
0
997,187
0
748,232
$15,676,012
CHANGE IN CASH BASIS NET ASSETS ....................
(2,259,957)
237,154
930,178
CASH BASIS NET ASSETS, BEGINNING OF YEAR...
$4,201,320
$ 1,941,363
$ 2,303,517(2)
$ 3,233,695
$ 1,687,390
CASH BASIS NET ASSETS, END OF YEAR ...............
$1,943,363
$ 2,178,517
$ 3,233,695
$ 1,687,390
$ 2,913,447
CASH BASIS NET ASSETS:
Restricted
Streets.......................................................................
Urban Renewal Purposes ..........................................
Debt Service..............................................................
Other Purposes .........................................................
Unrestricted .................................................................
Total Cash Basis Net Assets .........................................
$ 631,892
643,428
85,120
1,427,071
(846,148)
$1,941,363
$
$
$
$
Notes: (1)
(2)
414,151
489,392
504,888
1,175,429
(405,343)
$ 2,178,517
366,241
444,453
(347,267)
1,533,247
1,237,021
$ 3,233,695
(1,546,305)
451,767
489,022
(227,580)
2,333,587
(1,359,406)
$ 1,687,390
Source: Audited financial statements of the City for the fiscal years ended June 30, 2006 through 2010.
Restated.
21
1,226,057
532,914
547,195
(378,839)
2,590,508
(378,331)
$ 2,913,447
General Fund
Statement of Cash Receipts, Disbursements and Changes in Cash Balances(1)
2006
2007
RECEIPTS:
Property Taxes ........................................................
Other City Tax .........................................................
Licenses and Permits ..............................................
Use of Money and Property .....................................
Intergovernmental ...................................................
Charges for Service .................................................
Special Assessments ..............................................
Miscellaneous..........................................................
Total Receipts .......................................................
$2,139,804
0
242,983
115,469
159,794
163,651
12,651
137,092
$2,971,444
$2,324,036
99,160
293,117
151,429
202,902
177,824
6,008
123,442
$3,377,918
DISBURSEMENTS:
Public Safety ...........................................................
Public Works ...........................................................
Culture and Recreation............................................
Community and Economic Development .................
General Government ...............................................
Total Disbursements..............................................
$2,023,724
97,847
845,247
0
411,696
$3,378,514
Excess (Deficiency) of Receipts Over
(Under) Disbursements .......................................
2009
2010
$2,367,343
94,651
240,869
95,780
233,792
186,632
4,522
140,392
$3,363,981
$2,473,035
48,267
249,394
138,731
187,950
207,607
2,329
151,676
$3,458,989
$2,552,462
87,001
222,811
107,273
202,129
222,378
806
105,827
$3,500,687
$2,156,586
94,050
884,199
23,266
332,385
$3,490,486
$2,165,400
91,181
902,147
27,450
354,304
$3,540,482
$2,019,321
101,366
851,197
25,540
322,106
$3,319,530
$2,110,951
93,561
867,599
37,923
348,412
$3,458,446
$ (407,070)
$ (112,568)
$ (176,501)
$
$
42,241
$
$
$
$
$
0
63,893
63,893
Other Financing Sources (Uses):
Note Proceeds.........................................................
Operating Transfers (Net)
Total Other Financing Sources (Uses) ...................
$
0
334,000
334,000
Net Change in Cash Balances .................................
$
(73,070)
Cash Balances Beginning of Year ...........................
Cash Balances End of Year.....................................
$ (214,922)
$ (287,992)
Note:
(1)
Audited as of June 30
2008
0
301,740
$ 301,740
$ 189,172
$ 287,992)
$ (98,820)
139,459
0
317,126
$ 317,126
0
102,368
$ 102,368
$
$ 140,625
$ 241,827
$ 106,134
$
$
$ 41,805
$ 283,632
$ 283,632
$ 389,766
(98,820)
41,805
Source: The City's audited financial statements for fiscal years ending June 30, 2006 through 2010.
EMPLOYEE RETIREMENT OBLIGATIONS
In June 2004, the Governmental Accounting Standards Board (“GASB”) issued GASB 45, which address how
state and local governments are required to account for and report their costs and obligations related to other postemployment benefits (“OPEB”), defined to include post- retirement healthcare benefits. GASB 45 Accounting and
Financial Reporting by Employers for Postemployment Benefits Other Than Pension establishes financial reporting
standards designed to measure, recognize and display OPEB costs. OPEB costs would become measurable on an accrual
basis of accounting, and contribution rates (actuarially determined) would be prescribed for funding such costs. The
provisions of GASB 45 do not require governments to fund their OPEBs. The Issuer may establish its OPEB liability at
zero as of the beginning of the initial year of implementation; however the unfunded actuarial liability is required to be
amortized over future periods.
Consistent with Iowa Code section 509A.13, the City offers post-retirement medical/prescription drug benefits are
available to all fulltime employees and their spouses of the Issuer who retire at the age of 55. Retirees under as 65 pay the
same premium for medical/prescription drug benefits as active employees.
See APPENDIX A – Note (4 &5) herein for further discussion of the City’s employee retirement and other postemployment benefit obligations.
22
REGISTRATION, TRANSFER AND EXCHANGE
See also APPENDIX B, BOOK-ENTRY SYSTEM for information on registration, transfer and exchange of
book-entry Notes. The Notes will be initially issued as book-entry Notes.
The City shall cause books (the “Note Register”) for the registration and for the transfer of the Notes to be kept at
the principal corporate trust office of the Registrar in Des Moines, Iowa. The City will authorize to be prepared, and the
Registrar shall keep custody of, multiple Note blanks executed by the City for use in the transfer and exchange of Notes.
Any Note may be transferred or exchanged, but only in the manner, subject to the limitations, and upon payment
of the charges as set forth in the Note Resolution. Upon surrender for transfer or exchange of any Note at the principal
corporate trust office of the Registrar, duly endorsed by, or accompanied by a written instrument or instruments of transfer
in form satisfactory to the Registrar and duly executed by the registered owner or such owner’s attorney duly authorized
in writing, the City shall execute and the Registrar shall authenticate, date and deliver in the name of the registered owner,
transferee or transferees (as the case may be) a new fully registered Note or Notes of the same maturity and interest rate of
authorized denominations, for a like aggregate principal amount.
The execution by the City of any fully registered Note shall constitute full and due authorization of such Note,
and the Registrar shall thereby be authorized to authenticate, date and deliver such Note, provided, however, the principal
amount of outstanding Notes of each maturity authenticated by the Registrar shall not exceed the authorized principal
amount of Notes for such maturity less Notes previously paid.
The Registrar shall not be required to transfer or exchange any Note following the close of business on the 15th
day of the month next preceding any interest payment date on such Note, nor to transfer or exchange any Note after notice
calling such Note for redemption has been mailed, nor during a period of fifteen days next preceding mailing of a notice
of redemption of any Notes.
The person in whose name any Note shall be registered shall be deemed and regarded as the absolute owner
thereof for all purposes, and payment of the principal of or interest on any Notes shall be made only to or upon the order
of the registered owner thereof or such owner’s legal representative. All such payments shall be valid and effectual to
satisfy and discharge the liability upon such Note to the extent of the sum or sums so paid.
No service charge shall be made for any transfer or exchange of Notes, but the City or the Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Notes.
TAX MATTERS
Tax Exemption
Federal tax law contains a number of requirements and restrictions that apply to the Bonds, including investment
restrictions, periodic payments of arbitrage profits to the United States, requirements regarding the proper use of Bond
proceeds and facilities financed with Bond proceeds, and certain other matters. The Issuer has covenanted to comply with
all requirements that must be satisfied in order for the interest on the Bonds to be excludable from gross income for
federal income tax purposes. Failure to comply with certain of such covenants could cause interest on the Bonds to
become includable in gross income for federal income tax purposes retroactively to the date of issuance of the Bonds.
Subject to the Issuer’s compliance with the above-referenced covenants, under present law, in the opinion of
Bond Counsel, interest on the Bonds (a) is excludable from gross income of the owners thereof for federal income tax
purposes; (b) is not included as an item of tax preference in computing the federal alternative minimum tax imposed on
individuals and corporations; and (c) is not taken into account in computing an adjustment used in determining the federal
alternative minimum tax for certain corporations.
23
The interest on the Bonds is not exempt from present Iowa income taxes. Ownership of the Bonds may result in
other state and local tax consequences to certain taxpayers. Bond Counsel expresses no opinion regarding any such
collateral consequences arising with respect to the Bonds. Prospective purchasers of the Bonds should consult their tax
advisors regarding the applicability of any such state and local taxes.
Prospective purchasers of the Bonds should be aware that ownership of the Bonds may result in collateral federal
income tax consequences to certain taxpayers, including, without limitation, corporations subject to the branch profits tax,
financial institutions, certain insurance companies, certain S corporations, individual recipients of Social Security or
Railroad Retirement benefits and taxpayers who may be deemed to have incurred (or continued) indebtedness to purchase
or carry tax-exempt obligations. Bond Counsel will not express any opinion as to such collateral tax consequences.
Prospective purchasers of the Bonds should consult their tax advisors as to collateral federal income tax consequences.
Qualified Tax-Exempt Obligations
The Issuer will designate the Bonds as “qualified tax-exempt obligations” under the exception provided in Section
265(b)(3) of the Internal Revenue Code of 1986, as amended (the “Code”), which affords banks and certain other
financial institutions more favorable treatment of their deduction for interest expense than would otherwise be allowed
under Section 265(b)(2) of the Code.
Tax Accounting Treatment of Discount and Premium on Certain Bonds
The initial public offering price of certain Bonds (the "Discount Bonds") may be less than the amount payable on
such Bonds at maturity. An amount equal to the difference between the initial public offering price of a Discount Bond
(assuming that a substantial amount of the Discount Bonds of that maturity are sold to the public at such price) and the
amount payable at maturity constitutes original issue discount to the initial purchaser of such Discount Bond. A portion
of such original issue discount allocable to the holding period of such Discount Bond by the initial purchaser will, upon
the disposition of such Discount Bond (including by reason of its payment at maturity), be treated as interest excludable
from gross income, rather than as taxable gain, for federal income tax purposes, on the same terms and conditions as those
for other interest on the Bonds described above under "Tax Exemption". Such interest is considered to be accrued
actuarially in accordance with the constant interest method over the life of a Discount Bond, taking into account the
semiannual compounding of accrued interest, at the yield to maturity on such Discount Bond and generally will be
allocated to an original purchaser in a different amount from the amount of the payment denominated as interest actually
received by the original purchaser during the tax year.
However, such interest may be required to be taken into account in determining the amount of the branch profits
tax applicable to certain foreign corporations doing business in the United States, even though there will not be a
corresponding cash payment. In addition, the accrual of such interest may result in certain other collateral federal income
tax consequences to, among others, financial institutions, life insurance companies, property and casualty insurance
companies, S corporations with "subchapter C" earnings and profits, individual recipients of Social Security or Railroad
Retirement benefits, and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry,
or who have paid or incurred certain expenses allocable to, tax-exempt obligations. Moreover, in the event of the
redemption, sale or other taxable disposition of a Discount Bond by the initial owner prior to maturity, the amount
realized by such owner in excess of the basis of such Discount Bond in the hands of such owner (adjusted upward by the
portion of the original issue discount allocable to the period for which such Discount Bond was held) is includable in
gross income.
Owners of Discount Bonds should consult with their own tax advisors with respect to the determination of
accrued original issue discount on Discount Bonds for federal income tax purposes and with respect to the state and local
tax consequences of owning and disposing of Discount Bonds. It is possible that, under applicable provisions governing
determination of state and local income taxes, accrued interest on Discount Bonds may be deemed to be received in the
year of accrual even though there will not be a corresponding cash payment.
24
The initial public offering price of certain Bonds (the "Premium Bonds") may be greater than the amount of such
Bonds at maturity. An amount equal to the difference between the initial public offering price of a Premium Bond
(assuming that a substantial amount of the Premium Bonds of that maturity are sold to the public at such price) and the
amount payable at maturity constitutes premium to the initial purchaser of such Premium Bonds. The basis for federal
income tax purposes of a Premium Bond in the hands of such initial purchaser must be reduced each year by the
amortizable bond premium, although no federal income tax deduction is allowed as a result of such reduction in basis for
amortizable bond premium. Such reduction in basis will increase the amount of any gain (or decrease the amount of any
loss) to be recognized for federal income tax purposes upon a sale or other taxable disposition of a Premium Bond. The
amount of premium which is amortizable each year by an initial purchaser is determined by using such purchaser's yield
to maturity.
Purchasers of the Premium Bonds should consult with their own tax advisors with respect to the determination of
amortizable bond premium on Premium Bonds for federal income tax purposes and with respect to the state and local tax
consequences of owning and disposing of Premium Bonds.
Related Tax Matters
The Internal Revenue Service (the “Service”) has an ongoing program of auditing tax-exempt obligations to
determine whether, in the view of the Service, interest on such tax-exempt obligations is includable in the gross income of
the owners thereof for federal income tax purposes. It cannot be predicted whether or not the Service will commence an
audit of the Bonds. If an audit is commenced, under current procedures the Service may treat the Issuer as a taxpayer and
the bondholders may have no right to participate in such procedure. The commencement of an audit could adversely
affect the market value and liquidity of the Bonds until the audit is concluded, regardless of the ultimate outcome.
Payments of interest on, and proceeds of the sale, redemption or maturity of, tax-exempt obligations, including
the Bonds, are in certain cases required to be reported to the Service. Additionally, backup withholding may apply to any
such payments to any Bond owner who fails to provide an accurate Form W-9 Request for Taxpayer Identification
Number and Certification, or a substantially identical form, or to any Bond owner who is notified by the Service of a
failure to report any interest or dividends required to be shown on federal income tax returns. The reporting and backup
withholding requirements do not affect the excludability of such interest from gross income for federal tax purposes.
There are or may be pending in the Congress of the United States, legislative proposals, including some that carry
retroactive effective dates, that, if enacted, could alter or amend the federal tax matters referred to in this section or affect
the market value of the Bonds. It cannot be predicted whether or in what form any such proposal might be enacted or
whether, if enacted, it would apply to bonds issued prior to enactment. Prospective purchasers of the Bonds should
consult their own tax advisors regarding any pending or proposed tax legislation. Bond Counsel expresses no opinion
regarding any pending or proposed federal or state tax legislation.
Opinions
Bond Counsel’s opinion is not a guarantee of a result, or of the transaction on which the opinion is rendered, or of the
future performance of parties to the transaction, but represents its legal judgment based upon its review of existing
statutes, regulations, published rulings and court decisions and the representations and covenants of the Issuer described in
this section. No ruling has been sought from the Service with respect to the matters addressed in the opinion of Bond
Counsel and Bond Counsel’s opinion is not binding on the Service. Bond Counsel assumes no obligation to update its
opinion after the issue date to reflect any further action, fact or circumstance, or change in law or interpretation, or
otherwise.
See “APPENDIX D” for a form of Bond Counsel opinion for the Notes.
25
INFORMATION FROM PURCHASER
The Purchaser will be required to certify to the City immediately after the opening of bids: (i) the initial public
offering price of each maturity of the Notes (not including sales to bond houses and brokers or similar persons or
organizations acting in the capacity of underwriters or wholesalers) at which price a substantial amount of the Notes (not
less than 10% of each maturity) were sold to the public; or (ii) if less than 10% of any maturity has been sold, the price for
that maturity determined as of the time of the sale based upon the reasonably expected initial offering price to the public;
and (iii) that the initial public offering price does not exceed their fair market value of the Notes on the sale date. The
Purchaser will also be required to provide a certificate in a form acceptable to Bond Counsel at closing confirming the
information required by this paragraph.
CONTINUING DISCLOSURE
The City will enter into a Continuing Disclosure Undertaking (the “Undertaking”) for the benefit of the beneficial
owners of the Notes to send certain information annually and to provide notice of certain events to the Municipal
Securities Rulemaking Board (“MSRB”) pursuant to the requirements of Section (b)(5) of Rule 15c2-12, as amended, (the
“Rule”) adopted by the Securities and Exchange Commission (the “Commission”) under the Securities Exchange Act of
1934. The information to be provided on an annual basis, the events which will be noticed on an occurrence basis and a
summary of other terms of the Undertaking, including termination, amendment and remedies, are set forth in APPENDIX
C – FORM OF CONTINUING DISCLOSURE CERTIFICATE.
The City believes it has substantially complied with those undertakings previously entered into by it pursuant to
the Rule. A failure by the City to comply with the Undertaking will not constitute a default under the Note Resolution and
beneficial owners of the Notes are limited to the remedies described in the Undertaking. See APPENDIX C – FORM
OF CONTINUING DISCLOSURE CERTIFICATE. A failure by the City to comply with the Undertaking must be
reported in accordance with the Rule and must be considered by any broker, dealer or municipal securities dealer before
recommending the purchase or sale of the Notes in the secondary market. Consequently, such a failure may adversely
affect the transferability and liquidity of the Notes and their market price.
Bond Counsel expresses no opinion as to whether the Undertaking complies with the requirements of Section
(b)(5) of the Rule.
OPTIONAL REDEMPTION
Notes due June 1, 2012 - 2020, inclusive, are non-callable. Notes due June 1, 2021 - 2030, inclusive, are callable
in whole or in part on any date on or after June 1, 2020, at a price of par and accrued interest. If less than all the Notes are
called, they shall be redeemed in such principal amounts and from such maturities as determined by the City and within
any maturity by lot.
The Note Registrar will give notice of redemption, identifying the Notes (or portions thereof) to be redeemed, by
mailing a copy of the redemption notice by first class mail not less than thirty (30) days nor more than sixty (60) days
prior to the date fixed for redemption to the registered owner of each Note (or portion thereof) to be redeemed at the
address shown on the registration books maintained by the Note Registrar. Unless moneys sufficient to pay the
redemption price of the Notes to be redeemed are received by the Note Registrar prior to the giving of such notice of
redemption, such notice may, at the option of the City, state that said redemption will be conditional upon the receipt of
such moneys by the Note Registrar on or prior to the date fixed for redemption. If such moneys are not received, such
notice will be of no force and effect, the City will not redeem such Notes, and the Note Registrar will give notice, in the
same manner in which the notice of redemption has been given, that such moneys were not so received and that such
Notes will not be redeemed. Otherwise, prior to any redemption date, the City will deposit with the Note Registrar an
amount of money sufficient to pay the redemption price of all the Notes or portions of Notes which are to be redeemed on
the date.
26
Subject to the provisions for a conditional redemption described above, notice of redemption having been given as
described above and in the Note Resolution, the Notes or portions of Notes so to be redeemed will, on the redemption
date, become due and payable at the redemption price therein specified, and from and after such date (unless the City shall
default in the payment of the redemption price) such Notes or portions of Notes shall cease to bear interest. Upon
surrender of such Notes for redemption in accordance with said notice, such Notes will be paid by the Note Registrar at
the redemption price.
LITIGATION
There is no litigation of any nature now pending or threatened restraining or enjoining the issuance, sale,
execution or delivery of the Notes, or in any way contesting or affecting the validity of the Notes or any proceedings of
the City taken with respect to the issuance or sale thereof.
LEGAL MATTERS
The Notes are subject to approval as to certain legal matters by Ahlers & Cooney, P.C., Des Moines, Iowa, as
Bond Counsel. Bond Counsel has not participated in the preparation of this Official Statement except for guidance
concerning the section regarding “TAX MATTERS,” and will not pass upon its accuracy, completeness, or sufficiency.
Bond Counsel has not examined nor attempted to examine or verify any of the financial or statistical statements, or data
contained in this Official Statement, and will express no opinion with respect thereto.
The legal opinions to be delivered concurrently with the delivery of the Notes express the professional judgment
of the attorneys rendering the opinions as to legal issues expressly addressed therein. By rendering a legal opinion, the
opinion giver does not become an insurer or guarantor of the result indicated by that expression of professional judgment,
or of the transaction on which the opinion is rendered, or of the future performance of parties to the transaction. Nor does
the rendering of an opinion guarantee the outcome of any legal dispute that may arise out of the transaction.
OFFICIAL STATEMENT AUTHORIZATION
This Official Statement has been authorized for distribution to prospective purchasers of the Notes. All
statements, information, and statistics herein are believed to be correct but are not guaranteed by the consultants or by the
City, and all expressions of opinion, whether or not so stated, are intended only as such.
INVESTMENT RATING
The City has supplied certain information and material concerning the Notes and the City to the rating service
shown on the cover page as part of its application for investment rating on the Notes. Generally, such rating service bases
its ratings on such information and material, and also on such investigations, studies and assumptions that they may
undertake independently. There is no assurance that a rating for the Bonds will continue for any given period of time or
that it may not be lowered or withdrawn entirely by such rating service if, in their judgment, circumstances so warrant.
Any such downward change in or withdrawal of such rating may have an adverse effect on the secondary market price of
the Notes. An explanation of the significance of the investment rating may be obtained from the rating agency: Moody’s
Investors Service, 7 World Trade Center at 250 Greenwich Street, New York, New York 10007, telephone 212-553-1658.
27
UNDERWRITING
The Notes were offered for sale by the City at a public, competitive sale on April 19, 2011. The best bid
submitted at the sale was submitted by ____________________ (the “Underwriter”). The City awarded the contract for
sale of the Notes to the Underwriter at a price of $___________. The Underwriter has represented to the City that the
Notes have been subsequently re-offered to the public initially at the yields or prices set forth in the addendum to this
Official Statement.
FINANCIAL ADVISOR
The City has engaged Speer Financial, Inc. as financial advisor (the “Financial Advisor”) in connection with the
issuance and sale of the Notes. The Financial Advisor will not participate in the underwriting of the Notes. The financial
information included in the Official Statement has been compiled by the Financial Advisor. Such information does not
purport to be a review, audit or certified forecast of future events and may not conform with accounting principles
applicable to compilations of financial information. The Financial Advisor is not obligated to undertake any independent
verification of or to assume any responsibility for the accuracy, completeness or fairness of the information contained in
this Official Statement, nor is the Financial Advisor obligated by the City’s continuing disclosure undertaking.
CERTIFICATION
We have examined this Official Statement dated April 7, 2011, for the $6,915,000* General Obligation Capital
Loan Notes, Series 2011, believe it to be true and correct and will provide to the purchaser of the Notes at the time of
delivery a certificate confirming to the purchaser that to the best of our knowledge and belief information in the Official
Statement was at the time of acceptance of the proposal for the Notes and, including any addenda thereto, was at the time
of delivery of the Notes true and correct in all material respects and does not include any untrue statement of a material
fact, nor does it omit the statement of any material fact required to be stated therein, or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.
/s/
JOHN SLIGHT
Mayor
CITY OF BOONE
Boone County, Iowa
/s/
LUKE NELSON
City Administrator
CITY OF BOONE
Boone County, Iowa
28
APPENDIX A
CITY OF BOONE
BOONE COUNTY, IOWA
THE CITY HAS NOT REQUESTED ITS AUDITOR TO CONSENT TO THE INCLUSION OF SUCH
EXCERPTS IN THIS OFFICIAL STATEMENT
EXCERPTS FROM THE AUDITED FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDING
JUNE 30, 2010
A-1
A-2
A-3
A-4
A-5
A-6
A-7
A-8
APPENDIX B
DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
1.
The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the
Notes (the “Securities”). The Securities will be issued as fully-registered securities registered in the name of Cede & Co.
(DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fullyregistered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of
such issue, and will be deposited with DTC.
2.
DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the
New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the
Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a
“clearing agency” registered pursuant to the provisions of Section 1 7A of the Securities Exchange Act of 1934. DTC
holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal
debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”)
deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities
transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct
Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants
include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain
other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”).
DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing
Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries.
Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks,
trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant,
either directly or indirectly (“Indirect Participants”). DTC has Standard & Poor’s highest rating: AAA. The DTC Rules
applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can
be found at www.dtcc.com and www.dtc.org.
3.
Purchases of Securities under the DTC system must be made by or through Direct Participants, which will
receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser of each Security
(“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not
receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written
confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or
Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in
the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of
Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities,
except in the event that use of the book-entry system for the Securities is discontinued.
4.
To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered
in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized
representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other
DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners
of the Securities; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Securities are
credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for
keeping account of their holdings on behalf of their customers.
B-1
5.
Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to
Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.
Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of
significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the
Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the
Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial
Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided
directly to them.
6.
Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being
redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be
redeemed.
7.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities
unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC
mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s
consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
8.
Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede &
Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit
Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the City or the
Paying Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by
Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with
securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of
such Participant and not of DTC, the Paying Agent, or the City, subject to any statutory or regulatory requirements as may
be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or
such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the City or the
Paying Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement
of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.
9.
A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its
Participant, to any Tender/Remarketing Agent, and shall effect delivery of such Securities by causing the Direct
Participant to transfer the Participant’s interest in the Securities, on DTC’s records, to any Tender/Remarketing Agent.
The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be
deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC’s records and
followed by a book-entry credit of tendered Securities to any Tender/Remarketing Agent’s DTC account.
10.
DTC may discontinue providing its services as depository with respect to the Securities at any time by
giving reasonable notice to the City or the Paying Agent. Under such circumstances, in the event that a successor
depository is not obtained, Security certificates are required to be printed and delivered.
11.
The City may decide to discontinue use of the system of book-entry-only transfers through DTC (or a
successor securities depository). In that event, Security certificates will be printed and delivered to DTC.
12.
The information in this section concerning DTC and DTC’s book-entry system has been obtained from
sources that the City believes to be reliable, but the City takes no responsibility for the accuracy thereof.
B-2
APPENDIX C
CONTINUING DISCLOSURE CERTIFICATE
This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and delivered by the City of
Boone, State of Iowa (the "Issuer"), in connection with the issuance of $6,915,000 1 General Obligation Capital Loan
Notes, Series 2011 (the "Notes") dated May 15, 2011. The Notes are being issued pursuant to a Resolution of the Issuer
approved on May 2, 2011 (the "Resolution"). The Issuer covenants and agrees as follows:
SECTION 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by
the Issuer for the benefit of the Holders and Beneficial Owners of the Notes and in order to assist the Participating
Underwriters in complying with S.E.C. Rule 15c2-12(b)(5).
SECTION 2. Definitions. In addition to the definitions set forth in the Resolution, which apply to any capitalized
term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have
the following meanings:
"Annual Report" shall mean any Annual Report provided by the Issuer pursuant to, and as described in, Sections 3
and 4 of this Disclosure Certificate.
"Beneficial Owner" shall mean any person which (a) has the power, directly or indirectly, to vote or consent with
respect to, or to dispose of ownership of, any Notes (including persons holding Notes through nominees, depositories or
other intermediaries), or (b) is treated as the owner of any Notes for federal income tax purposes.
"Business Day" shall mean a day other than a Saturday or a Sunday or a day on which banks in Iowa are
authorized or required by law to close.
"Dissemination Agent" shall mean the Issuer or any Dissemination Agent designated in writing by the Issuer and
which has filed with the Issuer a written acceptance of such designation.
"Holders" shall mean the registered holders of the Notes, as recorded in the registration books of the Registrar.
"Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate.
"Municipal Securities Rulemaking Board" or "MSRB" shall mean the Municipal Securities Rulemaking Board,
1900 Duke Street, Suite 600, Alexandria, VA 22314.
"National Repository" shall mean the MSRB's Electronic Municipal Market Access website, a/k/a "EMMA"
(emma.msrb.org).
"Participating Underwriter" shall mean any of the original underwriters of the Notes required to comply with the
Rule in connection with offering of the Notes.
"Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as the same may be amended from time to time.
"State" shall mean the State of Iowa.
1
Preliminary, subject to change.
C-1
SECTION 3. Provision of Annual Reports.
(a)
The Issuer shall, or shall cause the Dissemination Agent to, not later than Two Hundred Seventy (270)
days after the end of the Issuer's fiscal year (presently June 30th), commencing with the report for the
2010/2011 fiscal year, provide to the National Repository an Annual Report which is consistent with the
requirements of Section 4 of this Disclosure Certificate. The Annual Report must be submitted in such
format as is required by the MSRB (currently in "searchable PDF" format). The Annual Report may be
submitted as a single document or as separate documents comprising a package. The Annual Report may
cross-reference other information as provided in Section 4 of this Disclosure Certificate; provided that the
audited financial statements of the Issuer may be submitted separately from the balance of the Annual
Report and later than the date required above for the filing of the Annual Report if they are not available
by that date. If the Issuer's fiscal year changes, it shall give notice of such change in the same manner as
for a Listed Event under Section 5(c).
(b)
If the Issuer is unable to provide to the National Repository an Annual Report by the date required in
subsection (a), the Issuer shall send a notice to the Municipal Securities Rulemaking Board, if any, in
substantially the form attached as Exhibit A.
(c)
The Dissemination Agent shall:
(i)
each year file the Annual Report with the National Repository; and
(ii)
(if the Dissemination Agent is other than the Issuer), file a report with the Issuer certifying that
the Annual Report has been filed pursuant to this Disclosure Certificate, stating the date it was
filed.
SECTION 4. Content of Annual Reports. The Issuer's Annual Report shall contain or incorporate by reference the
following:
(a)
The last available audited financial statements of the Issuer for the prior fiscal year, prepared in
accordance with generally accepted accounting principles promulgated by the Financial Accounting
Standards Board as modified in accordance with the governmental accounting standards promulgated by
the Governmental Accounting Standards Board or as otherwise provided under State law, as in effect
from time to time, or, if and to the extent such financial statements have not been prepared in accordance
with generally accepted accounting principles, noting the discrepancies therefrom and the effect thereof.
If the Issuer's audited financial statements for the preceding years are not available by the time the Annual
Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial
statements in a format similar to the financial statements contained in the final Official Statement, and the
audited financial statements shall be filed in the same manner as the Annual Report when they become
available.
b)
A table, schedule or other information contained in the final Official Statement under the captions
"Socioeconomic Information – Retail Sales and Local Option Sales Tax", "Property Tax Information",
"Debt Information", and "Financial Information".
Any or all of the items listed above may be included by specific reference to other documents, including official
statements of debt issues of the Issuer or related public entities, which have been filed with the National Repository. The
Issuer shall clearly identify each such other document so included by reference.
SECTION 5. Reporting of Significant Events.
(a)
Pursuant to the provisions of this Section 5, the Issuer shall give, or cause to be given, notice of the
occurrence of any of the following events with respect to the Notes in a timely manner not later than 10
Business Days after the day of the occurrence of the event;
C-2
(1)
Principal and interest payment delinquencies;
(2)
Non-payment related defaults, if material;
(3)
Unscheduled draws on debt service reserves reflecting financial difficulties;
(4)
Unscheduled draws on credit enhancements relating to the Notes reflecting financial difficulties;
(5)
Substitution of credit or liquidity providers, or their failure to perform;
(6)
Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final
determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material
notices or determinations with respect to the tax-exempt status of the Series Notes, or material
events affecting the tax-exempt status of the Notes;
(7)
Modifications to rights of Holders of the Notes, if material;
(8)
Note calls (excluding sinking fund mandatory redemptions), if material, and tender offers;
(9)
Defeasances of the Notes;
(10)
Release, substitution, or sale of property securing repayment of the Notes, if material;
(11)
Rating changes on the Notes;
(12)
Bankruptcy, insolvency, receivership or similar event of the Issuer;
(13)
The consummation of a merger, consolidation, or acquisition involving the Issuer or the sale of
all or substantially all of the assets of the Issuer, other than in the ordinary course of business, the
entry into a definitive agreement to undertake such an action or the termination of a definitive
agreement relating to any such actions, other than pursuant to its terms, if material; and
(14)
Appointment of a successor or additional trustee or the change of name of a trustee, if material.
(b)
Whenever the Issuer obtains the knowledge of the occurrence of a Listed Event, the Issuer shall determine
if the occurrence is subject to notice only if material, and if so shall as soon as possible determine if such
event would be material under applicable federal securities laws.
(c)
If the Issuer determines that knowledge of the occurrence of a Listed Event is not subject to materiality,
or determines such occurrence is subject to materiality and would be material under applicable federal
securities laws, the Issuer shall promptly, but not later than 10 Business Days after the occurrence of the
event, file a notice of such occurrence with the Municipal Securities Rulemaking Board through the filing
with the National Repository.
SECTION 6. Termination of Reporting Obligation. The Issuer's obligations under this Disclosure Certificate shall
terminate upon the legal defeasance, prior redemption or payment in full of all of the Notes or upon the Issuer's receipt of
an opinion of nationally recognized bond counsel to the effect that, because of legislative action or final judicial action or
administrative actions or proceedings, the failure of the Issuer to comply with the terms hereof will not cause Participating
Underwriters to be in violation of the Rule or other applicable requirements of the Securities Exchange Act of 1934, as
amended. If such termination occurs prior to the final maturity of the Notes, the Issuer shall give notice of such
termination in the same manner as for a Listed Event under Section 5(c).
C-3
SECTION 7. Dissemination Agent. The Issuer may, from time to time, appoint or engage a Dissemination Agent
to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Agent, with or
without appointing a successor Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for
the content of any notice or report prepared by the Issuer pursuant to this Disclosure Certificate. The initial Dissemination
Agent shall be the Issuer.
SECTION 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Issuer
may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the
following conditions are satisfied:
(a)
If the amendment or waiver relates to the provisions of Section 3(a), 4, or 5(a), it may only be made in
connection with a change in circumstances that arises from a change in legal requirements, change in law,
or change in the identity, nature or status of an obligated person with respect to the Notes, or the type of
business conducted;
(b)
The undertaking, as amended or taking into account such waiver, would, in the opinion of nationally
recognized bond counsel, have complied with the requirements of the Rule at the time of the original
issuance of the Notes, after taking into account any amendments or interpretations of the Rule, as well as
any change in circumstances; and
(c)
The amendment or waiver either (i) is approved by the Holders of the Notes in the same manner as
provided in the Resolution for amendments to the Resolution with the consent of Holders, or (ii) does not,
in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or
Beneficial Owners of the Notes.
In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Issuer shall describe such
amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the
amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation)
of financial information or operating data being presented by the Issuer. In addition, if the amendment relates to the
accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same
manner as for a Listed Event under Section 5(c), and (ii) the Annual Report for the year in which the change is made will
present a comparison or other discussion in narrative form (and also, if feasible, in quantitative form) describing or
illustrating the material differences between the financial statements as prepared on the basis of the new accounting
principles and those prepared on the basis of the former accounting principles.
SECTION 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer
from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any
other means of communication, or including any other information in any Annual Report or notice of occurrence of a
Listed Event, in addition to that which is required by this Disclosure Certificate. If the Issuer chooses to include any
information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically
required by this Disclosure Certificate, the Issuer shall have no obligation under this Certificate to update such
information or include it in any future Annual Report or notice of occurrence of a Listed Event.
SECTION 10. Default. In the event of a failure of the Issuer to comply with any provision of this Disclosure
Certificate, any Holder or Beneficial Owner of the Notes may take such actions as may be necessary and appropriate,
including seeking mandate or specific performance by court order, to cause the Issuer to comply with its obligations under
this Disclosure Certificate. Direct, indirect, consequential and punitive damages shall not be recoverable by any person
for any default hereunder and are hereby waived to the extent permitted by law. A default under this Disclosure
Certificate shall not be deemed an event of default under the Resolution, and the sole remedy under this Disclosure
Certificate in the event of any failure of the Issuer to comply with this Disclosure Certificate shall be an action to compel
performance.
C-4
SECTION 11. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have
only such duties as are specifically set forth in this Disclosure Certificate, and the Issuer agrees to indemnify and save the
Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities
which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs
and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the
Dissemination Agent's negligence or willful misconduct. The obligations of the Issuer under this Section shall survive
resignation or removal of the Dissemination Agent and payment of the Notes.
SECTION 12. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the
Dissemination Agent, the Participating Underwriters and Holders and Beneficial Owners from time to time of the Notes,
and shall create no rights in any other person or entity.
Date: __________ day of _______________, 2011.
CITY OF BOONE, STATE OF IOWA
By:
Mayor
ATTEST:
By:
City Clerk
EXHIBIT A
NOTICE TO NATIONAL REPOSITORY OF FAILURE TO FILE ANNUAL REPORT
Name of Issuer: City of Boone, Iowa.
Name of Note Issue: $6,915,000 2 General Obligation Capital Loan Notes, Series 2011
Dated Date of Issue: May 15, 2011
NOTICE IS HEREBY GIVEN that the Issuer has not provided an Annual Report with respect to the above-named
Notes as required by Section 3 of the Continuing Disclosure Certificate delivered by the Issuer in connection with the
Notes. The Issuer anticipates that the Annual Report will be filed by ____________________.
Dated: __________ day of _______________, 20___.
CITY OF BOONE, STATE OF IOWA
By:
Its:
2
C-5
APPENDIX D
100 COURT AVENUE, SUITE 600
DES MOINES, IOWA 50309-2231
PHONE: 515-243-7611
FAX: 515-243-2149
WWW.AHLERSLAW.COM
* DRAFT *
We hereby certify that we have examined a certified transcript of the proceedings of the City Council and acts of
administrative officers of the City of Boone, State of Iowa (the "Issuer"), relating to the issuance of General Obligation
Capital Loan Notes, Series 2011, by the City (the "Notes"), dated May 15, 2011, in the denomination of $5,000 or
multiples thereof, in the aggregate amount of $6,915,000 3.
We have examined the law and such certified proceedings and other papers as we deem necessary to render this
opinion as bond counsel.
As to questions of fact material to our opinion, we have relied upon representations of the Issuer contained in the
Resolution authorizing the Loan Agreement and issuance of the Notes (the "Resolution") and in the certified proceedings
and other certifications of public officials furnished to us, without undertaking to verify the same by independent
investigation.
We have not been engaged to or undertaken to review the accuracy, completeness or sufficiency of the official
statement or any offering material relating to the Notes and we express no opinion relating thereto.
Based on our examination and in reliance upon the certified proceedings and other certifications described above,
we are of the opinion, under existing law, as follows:
1.
The Issuer is duly created and validly existing as a body corporate and politic and political subdivision of
the State of Iowa with the corporate power to adopt and perform the Resolution and Loan Agreement and issue the Notes.
2.
3
The Loan Agreement and Notes are valid and binding general obligations of the Issuer.
D-1
3.
All taxable property in the territory of the Issuer is subject to ad valorem taxation without limitation as to
rate or amount to pay the Notes. Taxes have been levied by the Resolution for the payment of the Notes and the Issuer is
required by law to include in its annual tax levy the principal and interest coming due on the Notes to the extent the
necessary funds are not provided from other sources.
4.
The interest on the Notes is excluded from gross income for federal income tax purposes and interest on
the Notes is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and
corporations; however, with respect to corporations (as defined for federal income tax purposes), such interest is included
in adjusted current earnings for the purpose of determining the alternative minimum tax imposed on such corporations.
We express no opinion regarding other federal income tax consequences caused by the receipt or accrual of interest on the
Notes.
For the purpose of rendering the opinion set forth in paragraph numbered 4 above, we have assumed compliance
by the Issuer with requirements of the Internal Revenue Code of 1986, as amended, that must be met subsequent to the
issuance of the Notes in order that interest thereon be and remain excluded from gross income for federal income tax
purposes. Failure to comply with such requirements could cause the interest on the Notes to be so included in gross
income retroactive to the date of issuance of the Notes. The Issuer has covenanted to comply with such requirements.
It is to be understood that the rights of the holders of the Notes and the enforceability thereof may be subject to
bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or
hereafter enacted to the extent constitutionally applicable and that their enforcement may also be subject to the exercise of
judicial discretion in appropriate cases.
Respectfully submitted,
D-2
OFFICIAL BID FORM
City of Boone
923 8th Street
Boone, IA 50036-0550 Facsimile: (515) 433-0630
April 19, 2011
Speer Financial, Inc.
Facsimile: (319) 291-8628
Dear City Council Members:
For the $6,915,000* General Obligation Capital Loan Notes, Series 2011, (the “Notes”) of the City of Boone, Boone County, Iowa, as described in
the annexed Official Terms of Offering, which is expressly made a part of this bid, we will pay you $___________________ (no less than $6,859,680). The
Notes are to bear interest at the following respective rates (each rate a multiple of 1/8 or 1/100 of 1%).
MATURITIES* – JUNE 1
$830,000 ............ 2012
%
$220,000 ............ 2018
%
$290,000 ............ 2025
%
760,000 ............ 2013
%
225,000 ............ 2019
%
300,000 ............ 2026
%
480,000 ............ 2014
%
235,000 ............ 2020
%
320,000 ............ 2027
%
485,000 ............ 2015
%
245,000 ............ 2021
%
335,000 ............ 2028
%
450,000 ............ 2016
%
255,000 ............ 2022
%
355,000 ............ 2029
%
215,000 ............ 2017
%
265,000 ............ 2023
%
370,000 ............ 2030
%
280,000 ............ 2024
%
*Any consecutive maturities may be aggregated into no more than five term notes at the option of the bidder,
in which case the mandatory redemption provisions shall be on the same schedule as above.
Maturities: ____________ Term Maturity _______
Maturities:___________ Term Maturity _______
Maturities:___________ Term Maturity _______
The Notes are to be executed and delivered to us in accordance with the terms of this bid accompanied by the approving legal opinion of Ahlers &
Cooney, P.C., Des Moines, Iowa. The City will pay for the legal opinion. The Purchaser agrees to apply for CUSIP numbers within 24 hours and pay the
fee charged by the CUSIP Service Bureau and will accept the Notes with the CUSIP numbers as entered on the Notes.
As evidence of our good faith, we have wire transferred or enclose herewith a check or Surety Bond payable to the order of the Treasurer of the
City in the amount of TWO PERCENT OF PAR (the “Deposit”) under the terms provided in your Official Terms of Offering. Attached hereto is a list of
members of our account on whose behalf this bid is made.
Form of Deposit
Check One:
Account Manager Information
Bidders Option Insurance
We have purchased
insurance from:
Name
Certified/Cashier’s Check
Financial Surety Bond
Wire Transfer
[]
[]
[]
Address
Name of Insurer
(Please fill in)
By
Amount: $138,300
_____________________
City
State/Zip
Premium: _____________
Direct Phone
Maturities: (Check One)
FAX Number
____ _______Years
Email Address
____ All
The foregoing bid was accepted and the Notes sold by resolution of the City on April 19, 2011, and receipt is hereby acknowledged of the good
faith Deposit which is being held in accordance with the terms of the annexed Official Terms of Offering.
ATTEST:
CITY OF BOONE, BOONE COUNTY, IOWA
City Clerk
Mayor
---------------NOT PART OF THE BID--------------(Calculation of true interest cost)
Gross Interest
$
Less Premium/Plus Discount
$
True Interest Cost
$
True Interest Rate
%
TOTAL NOTE YEARS
59,902.33
AVERAGE LIFE
8.663 Years
City of Boone, Boone County, Iowa
_________________________________
THIS PAGE INTENTIONALLY
LEFT BLANK
_________________________________
Page 1 f 5
OFFICIAL TERMS OF OFFERING
$6,915,000*
CITY OF BOONE
Boone County, Iowa
The City of Boone, Boone County, Iowa (the “City”), will receive electronic bids on the SpeerAuction
(“SpeerAuction”) website address “www.SpeerAuction.com” for its $6,915,000* General Obligation Capital Loan Notes, Series
2011 (the “Notes”), on an all or none basis between 10:30 A.M. and 11:00 A.M., C.D.T., Tuesday, April 19, 2011. To bid
electronically, bidders must have: (1) completed the registration form on the SpeerAuction website, and (2) requested and
received admission to the City’s sale (as described below). The City will receive sealed bids for its $6,915,000* General
Obligation Capital Loan Notes, Series 2011, on an all or none basis, at City Hall, 923 8th St.., Boone, IA 50036-0550 until 11:00
A.M., C.D.T., Tuesday, April 19, 2011. The City will also receive facsimile bids at (319) 291-8628 or (515) 433-0630 for the
Notes, on an all or none basis until 11:00 A.M., C.D.T., Tuesday, April 19, 2011. Upon receipt, facsimile and electronic bids
will be sealed and treated as sealed bids, and along with all other electronic and sealed bids will be publicly opened and read.
Award will be made or all bids rejected at a meeting of the City Council on that date. The City reserves the right to
change these Official Terms of Offering. Any such change shall be made not less than twenty-four (24) hours prior to the
revised date and time for receipt of the bids for the Notes and shall be communicated by publishing the changes in the
Amendments Page of the SpeerAuction webpage and through Thompson Municipal News.
The Notes are general obligations payable as to both principal and interest from ad valorem taxes levied against all
taxable property of the City without limitation as to rate or amount, all except as limited by bankruptcy, insolvency,
moratorium, reorganization and other similar laws relating to the enforcement of creditors’ rights generally and except that
enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion.
The Notes will be in fully registered form in the denominations of $5,000 and integral multiples thereof in the name of
Cede & Co. as nominee of The Depository Trust Company (“DTC”), New York, New York, to which principal and interest
payments on the Notes will be paid. Individual purchases will be in book-entry form only. Interest on each Note shall be paid
by check or draft of the Note Registrar to the person in whose name such Note is registered at the close of business on the
fifteenth day of the month next preceding an interest payment date. The principal of the Notes shall be payable in lawful money
of the United States of America at the principal office maintained for the purpose by the Note Registrar in Des Moines, Iowa.
Semiannual interest is due June 1 and December 1 of each year, commencing December 1, 2011 and is payable by Bankers
Trust Company, Des Moines, Iowa (the “Note Registrar”). The Notes are dated May 15, 2011.
MATURITIES* – JUNE 1
$830,000 .................... 2012
760,000 .................... 2013
480,000 .................... 2014
485,000 .................... 2015
450,000 .................... 2016
215,000 .................... 2017
$220,000.................... 2018
225,000.................... 2019
235,000.................... 2020
245,000.................... 2021
255,000.................... 2022
265,000.................... 2023
280,000.................... 2024
$290,000 .................... 2025
300,000 .................... 2026
320,000 .................... 2027
335,000 .................... 2028
355,000 .................... 2029
370,000 .................... 2030
Any consecutive maturities may be aggregated into no more than five term notes at the option of the bidder,
in which case the mandatory redemption provisions shall be on the same schedule as above.
The Notes due June 1, 2012 - 2020, inclusive, are non-callable. Notes due June 1, 2021 - 2030, inclusive, are callable
in whole or in part and on any date on or after June 1, 2020, at a price of par and accrued interest. If less than all the Notes are
called, they shall be redeemed in any order of maturity as determined by the City and within any maturity by lot.
Page 2 of 5
Method of Bidding Electronically
Notwithstanding the fact that the City permits receiving bids electronically using SpeerAuction, all bidders must
have a signed, but uncompleted, Official Bid Form delivered to Speer Financial, Inc., Suite 608, 531 Commercial Street,
Waterloo, Iowa, (319) 291-8628 facsimile, prior to the close of bidding to which a printout of the electronic bid will be
attached and delivered to the City.
All-or-none bids must be submitted via the internet address www.SpeerAuction.com. The use of SpeerAuction
shall be at the bidder’s risk and expense and the City shall have no liability with respect thereto, including (without
limitation) liability with respect to incomplete, late arriving and non-arriving bids.
To bid via the SpeerAuction webpage, bidders must first visit the SpeerAuction webpage where, if they have not
previously registered with either SpeerAuction, Grant Street Group (the “Auction Administrator”) or any other website
administered by the Auction Administrator, they may register and then request admission to bid on the Notes. Bidders
will be notified prior to the scheduled bidding time of their eligibility to bid. Only broker-dealers and dealer banks with
DTC clearing arrangements will be eligible to bid via the SpeerAuction webpage.
The “Rules” of the SpeerAuction bidding process may be viewed on the SpeerAuction webpage and are
incorporated herein by reference. Bidders must comply with the Rules of SpeerAuction in addition to the requirements of
the County’s Official Terms of Offering. In the event the Rules of SpeerAuction and this Official Terms of Offering
conflict, this Official Terms of Offering shall be controlling.
All electronic bids must be submitted on the SpeerAuction webpage. Bidders may change and submit bids as
many times as they choose during the sale period but may not delete a submitted bid. The last bid submitted by a bidder
before the deadline for receipt of bids will be compared to all other final bids to determine the winning bidder. During the
bidding, no bidder will see any other bidder’s bid nor the status of their bid relative to other bids (e.g., whether their bid is
a leading bid). The bidder bears all risk of transmission failure. Any questions regarding bidding on the SpeerAuction
website should be directed to Grant Street Group at (412) 391-5555 x370.
The City reserves the right to reject all bids, to reject any bid not conforming to this Official Terms of Offering,
and to waive any irregularity or informality with respect to any bid. Additionally, the City reserves the right to modify or
amend this Official Terms of Offering; however, any such modification or amendment shall not be made less than twentyfour (24) hours prior to the date and time for receipt of bids on the Notes and any such modification or amendment will be
announced on the Amendments Page of the SpeerAuction webpage and through Thompson Municipal News.
Each bidder shall be solely responsible for making necessary arrangements to access SpeerAuction for purposes
of submitting its internet bid in a timely manner and in compliance with the requirements of the Terms of Offering. The
City is permitting bidders to use the services of the SpeerAuction solely as a communication mechanism to conduct the
internet bidding and the SpeerAuction is not an agent of the City. Provisions of the Notice of Sale, Terms of Offering or
Official Bid Form shall control in the event of conflict with information provided by the Internet Bid System.
Electronic Facsimile Bidding: Bids may be submitted via facsimile at (319) 291-8628 or (515) 433-0630.
Electronic facsimile bids will be sealed and treated as sealed bids. Neither the City nor its agents will assume liability for
the inability of the bidder to reach the above named fax numbers prior to the time of sale specified above. Transmissions
received after the deadline will be rejected. Bidders electing to submit bids via facsimile transmission bear full and
complete responsibility for the transmission of such bid. Time of receipt shall be the time recorded by the person
receiving the facsimile, and shall be conclusive.
Page 3 of 5
Bid Parameters and Award of the Notes
The Notes must be in multiples of one-eighth or one one-hundredth of one percent (1/8 or 1/100 of 1%). The
rates shall be in non-descending order. The differential between the highest rate and the lowest rate shall not exceed six
percent (6%). All bids must be for all of the Notes, must be for not less than $6,859,680 plus accrued interest, if any,
from the dated date to the date of delivery, must be signed and made upon the Official Bid Form and delivered at the time
and place set forth above.
Award of the Notes: The Notes will be awarded on the basis of true interest cost, determined in the following
manner. True interest cost shall be computed by determining the annual interest rate (compounded semi-annually)
necessary to discount the debt service payments on the Notes from the payment date thereof to the dated date and to the
bid price. For the purpose of calculating true interest cost, the Notes shall be deemed to become due in the principal
amounts and at the times set forth in the table of maturities set forth above.
The Notes will be awarded to the purchaser complying with the terms of this Official Terms of Offering whose
bid produces the lowest true interest cost rate to the City as determined by the City’s Financial Advisor, which
determination shall be conclusive and binding on all prospective purchasers; provided, that the City reserves the right to
reject all bids or any non-conforming bid and reserves the right to waive any informality in any bid.
The winning purchaser will be required to make the standard filings and maintain the appropriate records
routinely required pursuant to MSRB Rules G-8, G-11 and G-36. The winning purchaser will be required to pay the
standard MSRB charge for Notes purchased. In addition, the winning purchaser who is a member of the Securities
Industry and Financial Markets Association (“SIFMA”) will be required to pay SIFMA’s standard charge per Note.
Good Faith Deposit and Other Matters
Each bid shall be accompanied by a certified or cashier’s check on, or a wire transfer from, a solvent bank or trust
company or a Financial Surety Bond for TWO PERCENT OF PAR payable to the City’s Treasurer as evidence of good
faith of the prospective purchaser (the “Deposit”). The Deposit of the successful purchaser will be retained by the City
pending delivery of the Notes and all others will be promptly returned. Should the successful purchaser fail to take up and
pay for the Notes when tendered in accordance with this Official Terms of Offering and said bid, said Deposit shall be
retained as full and liquidated damages to the City caused by failure of the purchaser to carry out the offer of purchase.
Such Deposit will otherwise be applied on the purchase price upon delivery of the Notes. No interest on the Deposit will
accrue to the Purchaser.
If a wire transfer is used for the Deposit, it must be sent according to the following wire instructions:
Amalgamated Bank of Chicago
One W. Monroe Street
Chicago, Illinois 60603
ABA # 071003405
Credit to: DDA # 150002305
Further Credit to: 1853281001 Speer Bidding Escrow
RE: [name of prospective purchaser] bid for [name of Note issue]
Page 4 of 5
The wire shall arrive in such account no later than 30 minutes prior to the date and time of the sale of the Notes.
Contemporaneously with such wire transfer, the prospective purchaser shall send an email to biddingescrow@aboc.com
with the following information: (1) indication that a wire transfer has been made, (2) the amount of the wire transfer, (3)
the issue to which it applies, and (4) the return wire instructions if such prospective purchaser is not awarded the Notes.
The City and any prospective purchaser who chooses to wire the Deposit hereby agree irrevocably that Speer Financial,
Inc. (“Speer”) shall be the escrow holder of the Deposit wired to such account subject only to these conditions and duties:
(i) if the bid is not accepted, Speer shall, at its expense, promptly return the Deposit amount to the unsuccessful
prospective purchaser; (ii) if the bid is accepted, the Deposit shall be forwarded to the City, (iii) Speer shall bear all costs
of maintaining the escrow account and returning the funds to the prospective purchaser; (iv) Speer shall not be an insurer
of the Deposit amount and shall have no liability except if it willfully fails to perform, or recklessly disregards, its duties
specified herein; and (v) income earned on the Deposit, if any, shall be retained by Speer.
If a Financial Surety Bond is used for the Deposit, it must be from an insurance company licensed to issue such a
bond in the State of Iowa and such bond must be submitted to Speer prior to the opening of the bids. The Financial Surety
Bond must identify each prospective purchaser whose deposit is guaranteed by such Financial Surety Bond. If the Notes
are awarded to a purchaser using a Financial Surety Bond, then that purchaser is required to submit its Deposit to the City
in the form of a certified or cashier’s check or wire transfer as instructed by Speer, or the City not later than 3:00 P.M. 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 County to satisfy the Deposit requirement.
The City covenants and agrees to enter into a written agreement, certificate or contract, constituting an
undertaking (the “Undertaking”) to provide ongoing disclosure about the City for the benefit of the beneficial owners of
the Notes on or before the date of delivery of the Notes as required under Section (b)(5) of Rule 15c2-12 (the “Rule”)
adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934. The Undertaking shall
be as described in the Official Statement, with such changes as may be agreed in writing by the Underwriter. The City
represents that it is in substantial compliance with each and every undertaking previously entered into by it pursuant to the
Rule.
The Underwriter’s obligation to purchase the Notes shall be conditioned upon the City delivering the Undertaking
on or before the date of delivery of the Notes.
The Notes will be delivered to the successful purchaser against full payment in immediately available funds as
soon as they can be prepared and executed, which is expected to be on or about May 18, 2011. Should delivery be
delayed beyond sixty (60) days from the date of sale for any reason beyond the control of the City except failure of
performance by the purchaser, the City may cancel the award or the purchaser may withdraw the good faith deposit and
thereafter the purchaser’s interest in and liability for the Notes will cease.
The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates,
principal amounts, and interest rates of the Notes, and any other information required by law or deemed appropriate by the
County, shall constitute a “Final Official Statement” of the City with respect to the Notes, as that term is defined in the
Rule. By awarding the Notes to any underwriter or underwriting syndicate, the City agrees that, no more than seven (7)
business days after the date of such award, it shall provide, without cost to the senior managing underwriter of the
syndicate to which the Notes are awarded, up to 50 copies of the Final Official Statement to permit each “Participating
Underwriter” (as that term is defined in the Rule) to comply with the provisions of such Rule. The City shall treat the
senior managing underwriter of the syndicate to which the Notes are awarded as its designated agent for purposes of
distributing copies of the Final Official Statement to each Participating Underwriter. Any underwriter executing and
delivering an Official Bid Form with respect to the Notes agrees thereby that if its bid is accepted by the City it shall enter
into a contractual relationship with all Participating Underwriters of the Notes for purposes of assuring the receipt by each
such Participating Underwriter of the Final Official Statement.
Page 5 of 5
By submission of its bid, the senior managing underwriter of the successful purchaser agrees to supply all
necessary pricing information and any Participating Underwriter identification necessary to complete the Official
Statement within 24 hours after award of the Notes. Additional copies of the Final Official Statement may be obtained by
Participating Underwriters from the printer at cost.
The City will, at its expense, deliver the Notes to the purchaser in New York, New York (or arrange for “FAST”
delivery) through the facilities of DTC and will pay for the bond attorney’s opinion. At the time of closing, the City will
also furnish to the purchaser the following documents, each dated as of the date of delivery of the Notes: (1) the legal
opinion of Ahlers & Cooney, P.C., Des Moines, Iowa, that the Notes are lawful and enforceable obligations of the City in
accordance with their terms; (2) the opinion of said attorneys that the interest on the Notes is exempt from federal income
taxes as and to the extent set forth in the Official Statement for the Notes; and (3) a no litigation certificate by the City.
The City has authorized the printing and distribution of an Official Statement containing pertinent information
relative to the City and the Notes. Copies of such Official Statement or additional information may be obtained from Mr.
Luke Nelson, Finance Director, City of Boone, 923 8th Street, Boone, Iowa, or an electronic copy of this Official
Statement is available from the www.speerfinancial.com website under “Official Statement Sales Calendar” or from the
Independent Public Finance Consultants to the City, Speer Financial, Inc., 531 Commercial Street, Suite 608, Waterloo,
Iowa 50701 (telephone (319) 291-2077) and One North LaSalle Street, Suite 4100, Chicago, Illinois 60602 (telephone
(312) 346-3700).
/s/ LUKE NELSON
Finance Director
CITY OF BOONE
Boone, County, Iowa

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