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Proceedings for Directing Sale of $2,525,000 Tax Exempt General Obligation Bonds and $7,055,000 Taxable General Obligation Bonds
City of Dubuque City Council Meeting Action Items # 08. Copyrighted May 16, 2022 ITEM TITLE: Proceedings for Directing Sale of $2,525,000 Tax Exempt General Obligation Bonds, Series 2022A and $7,055,000 Taxable General Obligation Bonds, Series 2022B and Awarding Bonds to Best Bidder SUMMARY: City Manager recommending approval of the suggested proceedings for directing sale of the $2,525,000 Tax Exempt General Obligation Bonds, Series 2022A and $7,055,000 Taxable General Obligation Bonds, Series 2022B and awarding bonds to the best bidder. RESOLUTION Directing Sale of $2,525,000* (Subject To Adjustment Per Terms of Offering) General Obligation Bonds, Series 2022A RESOLUTION Directing Sale of $7,055,000* (Subject To Adjustment Per Terms of Offering) Taxable General Obligation Bonds, Series 2022B SUGGESTED Suggested Disposition: Receive and File; Adopt Resolution(s) DISPOSITION: ATTACHMENTS: Description Type MVM Memo City Manager Memo Staff Memo Staff Memo Series 2022A Sale Award Proceedings Resolutions Series 2022B Sale Award Proceedings Resolutions Moody's Investors Service Credit Opinion Supporting Documentation Bond Counsel Letter Supporting Documentation THE CITY OF Dubuque DUB E All -America Ciq LL� .n Masterpiece pp iece on the Mississippi �°°'�z°l 22013 zoi7*2019ol9 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Proceedings for Directing Sale of $2,525,000 Tax Exempt General Obligation Bonds, Series 2022A and $7,055,000 Taxable General Obligation Bonds, Series 2022B and Awarding Bonds to Best Bidder DATE: May 9, 2022 Director of Finance and Budget Jennifer Larson recommends City Council Approval of the suggested proceedings for directing sale of the $2,525,000 Tax Exempt General Obligation Bonds, Series 2022A and $7,055,000 Taxable General Obligation Bonds, Series 2022B and awarding bonds to the best bidder. The bond sale will be held on May 16, 2022, at 10:00 a.m. The results will be brought to the May 16t" City Council meeting. A letter from attorney Kristin Billingsley Cooper detailing information on the bond sale proceedings is enclosed. I concur with the recommendation and respectfully request Mayor and City Council approval. ./�� k�4ZA-:�� Mic ael C. Van Milligen JML Attachment cc- Crenna Brumwell, City Attorney Cori Burbach, Assistant City Manager Cassie Ross, Assistant Director of Finance THE CITY OF Dubuque DUB E All -America Ciq LL� .n Masterpiece pp iece on the Mississippi �°°'�z°l 22013 zoi7*2019ol9 TO: Michael C. Van Milligen, City Manager FROM: Jennifer Larson, Director of Finance and Budget SUBJECT: Proceedings for Directing Sale of $2,525,000 Tax Exempt General Obligation Bonds, Series 2022A and $7,055,000 Taxable General Obligation Bonds, Series 2022B and Awarding Bonds to Best Bidder DATE: May 9, 2022 DISCUSSION The purpose of this memorandum is to recommend directing sale of the $2,525,000 Tax Exempt General Obligation Bonds, Series 2022A and $7,055,000 Taxable General Obligation Bonds, Series 2022B and awarding bonds to the best bidder. The bond sale will be held on May 16, 2022, at 10:00 a.m. The results will be brought to the May 16t" City Council meeting. A letter from attorney Kristin Billingsley Cooper detailing information on the bond sale proceedings is enclosed. RECOMMENDATION I respectfully recommend the adoption of the enclosed resolutions to award the sale of the bonds and redemption of the refunded bonds. JML Attachment cc- Crenna Brumwell, City Attorney Cori Burbach, Assistant City Manager Cassie Ross, Assistant Director of Finance ITEMS TO INCLUDE ON AGENDA CITY OF DUBUQUE, IOWA $2,525,000* (Subject to Adjustment per Terms of Offering) General Obligation Bonds, Series 2022A Receipt of bids. Resolution directing sale. NOTICE MUST BE GIVEN PURSUANT TO IOWA CODE CHAPTER 21 AND THE LOCAL RULES OF THE CITY. May 16, 2022 The Director of Finance & Budget of the City of Dubuque, State of Iowa, met at 50 W. 13th Street, Dubuque, IA 52001 at 10:00 A.M., on the above date, to open sealed bids received, access electronic bids and to refer the sale of the Bonds to the best and most favorable bidder for cash, subject to approval by the City Council at 6:30 P.M. on the above date. The following persons were present: Tionna Pooler, Independent Public Advisors Jennifer Larson, Director of Finance and Budget -1- This being the time and place for the opening of bids for the sale of $2,525,000* (Subject to Adjustment per Terms of Offering) General Obligation Bonds, Series 2022A, the meeting was opened for the receipt of bids for the Bonds. The following actions were taken: Sealed bids were filed and listed in the minutes while unopened, as follows: Name & Address of Bidders: (Attach List of Bidders) 2. The Director of Finance & Budget then declared the time for filing of sealed bids to be closed and that the sealed bids be opened. The sealed bids were opened and announced. 3. Electronic bids received were accessed and announced as follows: Name & Address of Bidders: (Attach List of Bidders) 4. The best bid was determined to be as follows: Name & Address of Bidder: Bernardi Securities, Inc., Northfield, IL True Interest Rate (as -bid): 3.937784% Net Interest Cost (as -bid): $1,180,253.92 In consultation with Independent Public Advisors, LLC, the City considered the adjustment of the aggregate principal amount of the Bonds and each scheduled maturity thereof in accordance with the Terms of Offering and the following actions were taken: Final Par Amount as adjusted: $2,525,000.00 Purchase Price as adjusted: $2,553,979.90 All bids were then referred to the Council for action. -2- May 16, 2022 The City Council of the City of Dubuque, State of Iowa, met in regular session, in the Historic Federal Building, 350 West 61h Street, Dubuque, Iowa, 52001, at 6:30 P.M., on the above date. There were present Mayor Pro Tem Resnick, in the chair, and the following named Council Members: Mayor Cavanagh (attended virtually), Farber, Jones, Roussell, Sprank, Wethal Absent: Vacant: -3- Council Member Farber introduced the following Resolution entitled "RESOLUTION DIRECTING SALE OF $2,525,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) GENERAL OBLIGATION BONDS, SERIES 2022A," and moved its adoption. Council Member Roussell seconded the motion to adopt. The roll was called and the vote was, AYES: Wethal, Resnick, Roussell, Farber, Jones, Sprank, Cavanagh NAYS: Whereupon, the Mayor declared the following Resolution duly adopted: RESOLUTION NO. 201-22 RESOLUTION DIRECTING SALE OF $2,525,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) GENERAL OBLIGATION BONDS, SERIES 2022A WHEREAS, bids have been received for the Bonds described as follows and the best bid received (with permitted adjustments, if any) is determined to be the following: $2,525,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) GENERAL OBLIGATION BONDS, SERIES 2022A Bidder: Bernardi Securities, Inc. of Northfield, IL The terms of award: Final Par Amount as adjusted: $2,525,000.00 Purchase Price as adjusted: $ 2,553,979.90 True Interest Rate: 3.937784% Net Interest Cost: $1,180,253.92 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, STATE OF IOWA: Section 1. That the bid for the Bonds as above set out is hereby determined to be the best and most favorable bid received and, the Bonds are hereby awarded as described above. Section 2. That the statement of information for Bond bidders and the form of contract for the sale of the Bonds are hereby approved and the Mayor and Clerk are authorized to execute the same on behalf of the City. Section 3. That the notice of the sale of the Bonds heretofore given and all acts of the Clerk done in furtherance of the sale of the Bonds are hereby ratified and approved. PASSED AND APPROVED this 16a' day of May, 2022. ATTEST: Assistant City Clerk Mayor Pro Tern -5- CERTIFICATE STATE OF IOWA ) ) SS COUNTY OF DUBUQUE ) I, the undersigned City Clerk of the City of Dubuque, State of Iowa, do hereby certify that attached is a true and complete copy of the portion of the records of the City showing proceedings of the Council, and the same is a true and complete copy of the action taken by the Council with respect to the matter at the meeting held on the date indicated in the attachment, which proceedings remain in full force and effect, and have not been amended or rescinded in any way; that meeting and all action thereat was duly and publicly held in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council pursuant to the local rules of the Council and the provisions of Chapter 21, Code of Iowa, upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by law and with members of the public present in attendance; I further certify that the individuals named therein were on the date thereof duly and lawfully possessed of their respective City offices as indicated therein, that no Council vacancy existed except as may be stated in the proceedings, and that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City or the right of the individuals named therein as officers to their respective positions. WITNESS my hand and the seal of the Council hereto affixed this 19 fh Y da of m� 2022. /j i/�� k City Clerk, City of Dubuque, State of Iowa 02043066-1 \1 0422-221 ITEMS TO INCLUDE ON AGENDA CITY OF DUBUQUE, IOWA $7,055,000* (Subject to Adjustment per Terms of Offering) Taxable General Obligation Bonds, Series 2022B Receipt of bids. Resolution directing sale. NOTICE MUST BE GIVEN PURSUANT TO IOWA CODE CHAPTER 21 AND THE LOCAL RULES OF THE CITY. May 16, 2022 The Director of Finance & Budget of the City of Dubuque, State of Iowa, met at 50 W. 13th Street, Dubuque, Iowa at 10:00 A.M., on the above date, to open sealed bids received, access electronic bids and to refer the sale of the Bonds to the best and most favorable bidder for cash, subject to approval by the City Council at 6:30 P.M. on the above date. The following persons were present: Tionna Pooler, President, Independent Public Advisors Jennifer Larson, Director of Finance and Budget -1- This being the time and place for the opening of bids for the sale of $7,055,000* (Subject to Adjustment per Terms of Offering) Taxable General Obligation Bonds, Series 2022B, the meeting was opened for the receipt of bids for the Bonds. The following actions were taken: Sealed bids were filed and listed in the minutes while unopened, as follows: Name & Address of Bidders: (Attach List of Bidders) 2. The Director of Finance & Budget then declared the time for filing of sealed bids to be closed and that the sealed bids be opened. The sealed bids were opened and announced. 3. Electronic bids received were accessed and announced as follows: Name & Address of Bidders: (Attach List of Bidders) 4. The best bid was determined to be as follows: Name & Address of Bidder: Robert W. Baird & Co., Inc., Milwaukee, WI True Interest Rate (as -bid): 4.414542% Net Interest Cost (as -bid): $4,034,409.67 In consultation with Independent Public Advisors, LLC, the City considered the adjustment of the aggregate principal amount of the Bonds and each scheduled maturity thereof in accordance with the Terms of Offering and the following actions were taken: Final Par Amount as adjusted: $7,055,000.00 Purchase Price as adjusted: $7,000,860.75 All bids were then referred to the Council for action. -2- May 16, 2022 The City Council of the City of Dubuque, State of Iowa, met in regular session, in the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa, 52001, at 6:30 P.M., on the above date. There were present Mayor Pro Tern Resnick, in the chair, and the following named Council Members: Mayor Cavanagh (attended virtually), Farber, Jones, Roussell, Sprank, Wethal Absent: Vacant: -3- Council Member Farber introduced the following Resolution entitled "RESOLUTION DIRECTING SALE OF $7,055,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) TAXABLE GENERAL OBLIGATION BONDS, SERIES 2022B," and moved its adoption. Council Member Roussell seconded the motion to adopt. The roll was called and the vote was, AYES: Wethal, Resnick, Roussell, Farber, Jones, Sprank, Cavanagh NAYS: Whereupon, the Mayor declared the following Resolution duly adopted: RESOLUTION NO.202-22 RESOLUTION DIRECTING SALE OF $7,055,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) TAXABLE GENERAL OBLIGATION BONDS, SERIES 2022B WHEREAS, bids have been received for the Bonds described as follows and the best bid received (with permitted adjustments, if any) is determined to be the following: $7,055,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) TAXABLE GENERAL OBLIGATION BONDS, SERIES 2022B Bidder: Robert W. Baird & Co., Inc. of Milwaukee, WI The terms of award: Final Par Amount as adjusted: $7,055,000.00 Purchase Price as adjusted: $ 7,000,860.75 True Interest Rate: 4.414542% Net Interest Cost: $4,034,409.67 M NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, STATE OF IOWA: Section 1. That the bid for the Bonds as above set out is hereby determined to be the best and most favorable bid received and, the Bonds are hereby awarded as described above. Section 2. That the statement of information for Bond bidders and the form of contract for the sale of the Bonds are hereby approved and the Mayor and Clerk are authorized to execute the same on behalf of the City. Section 3. That the notice of the sale of the Bonds heretofore given and all acts of the Clerk done in furtherance of the sale of the Bonds are hereby ratified and approved. PASSED AND APPROVED this 161h day of May, 2022. ATTEST: v Assistant City Clerk Mayor Pro Tem -5- CERTIFICATE STATE OF IOWA ) ) SS COUNTY OF DUBUQUE ) I, the undersigned City Clerk of the City of Dubuque, State of Iowa, do hereby certify that attached is a true and complete copy of the portion of the records of the City showing proceedings of the Council, and the same is a true and complete copy of the action taken by the Council with respect to the matter at the meeting held on the date indicated in the attachment, which proceedings remain in full force and effect, and have not been amended or rescinded in any way; that meeting and all action thereat was duly and publicly held in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council pursuant to the local rules of the Council and the provisions of Chapter 21, Code of Iowa, upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by law and with members of the public present in attendance; I further certify that the individuals named therein were on the date thereof duly and lawfully possessed of their respective City offices as indicated therein, that no Council vacancy existed except as may be stated in the proceedings, and that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City or the right of the individuals named therein as officers to their respective positions. WITNESS my hand and the seal of the Council hereto affixed this I ath I day of May 2022. City Clerk, City of Dubuque, State of Iowa 'aV OF ; 02043102-1 \1 0422-222 CREDIT OPINION 10 May 2022 Contacts David Levett +1.312.706.9990 VP -Senior Analyst david.levett@moodys.com Thomas Jacobs +1.212.553.0131 Senior Vice President/Manager thomas.jacobs@moodys.com CLIENT SERVICES Americas 1-212-553-1653 Asia Pacific 852-3551-3077 Japan 81-3-5408-4100 EMEA 44-20-7772-5454 Dubuque (City of) IA Update to credit analysis Summary The City of Dubuque's (Aa3) credit profile is benefitting from a steadily growing tax base. Reserves are very healthy and will remain so supported by strong revenue trends. The city received a large infusion of federal aid that it is using primarily for capital, which is causing some variability in year end reserves. While full value per capita and full value are growing they remain well below medians of higher rated entities as does resident income. The city's leverage is somewhat elevated and will likely remain so given outstanding capital needs. Credit strengths Growing tax base bolstered by role as a regional economic center for northeastern Iowa Very healthy reserves and ample revenue raising flexibility Credit challenges Full value per capita and median family income trail medians for the rating category Elevated leverage Rating outlook Outlooks are usually not assigned to local governments with this amount of debt. Factors that could lead to an upgrade Moderated debt burden and capital needs Strengthening of median family income and full value per capita Factors that could lead to a downgrade Substantial decline in reserves Significant increase in the debt or pension burden Key indicators Exhibit I Dubuque (City of) IA 2017 2018 2019 2020 2021 Economy/Tax Base Total Full Value ($000) $4,434,972 $4,557,804 $4,790,304 $4,836,468 $5,189,859 Population 58,410 58,340 58,196 58,052 58,052 Full Value Per Capita $75,928 $78,125 $82,313 $83,313 $89,400 Median Family Income (% of US Median) 90.6% 91.2% 94.2% 92.6% 92.6% Finances Operating Revenue ($000) $78,100 $76,321 $78,540 $77,290 $85,137 Fund Balance ($000) $19,052 $22,027 $25,252 $26,876 $38,468 Cash Balance ($000) $19,096 $21,820 $25,956 $26,202 $50,875 Fund Balance as a % of Revenues 24.4% 28.9% 32.2% 34.8% 45.2% Cash Balance as a % of Revenues 24.5% 28.6% 33.0% 33.9% 59.8% Debt/Pensions Net Direct Debt ($000) $137,134 $128,749 $136,385 $127,631 $123,018 3-Year Average of Moody's ANPL ($000) $162,510 $168,903 $171,277 $166,399 $193,418 Net Direct Debt / Full Value (%) 3.1% 2.8% 2.8% 2.6% 2.4% Net Direct Debt / Operating Revenues (x) 1.8x 1.7x 1.7x 1.7x 1.4x Moody's - ANPL (3-yr average) to Full Value (%) 3.7% 3.7% 3.6% 3.4% 3.7% Moodv's - ANPL (3-vr average) to Revenues W 2.1x 2.2x 2.2x 2.2x 2.3x Sources: US Census Bureau, Dubuque (City of) IA's financial statements and Moody's Investors Service Profile The City of Dubuque is a regional economic center located on the Mississippi River in northeastern Iowa (Aaa stable), bounded by Wisconsin (Aal stable) on the northeast and Illinois (Baal stable) on the southeast. The city is approximately 63 miles northeast of Cedar Rapids (Aal stable) and has a population of approximately 58,000. Detailed credit considerations Economy and tax base: regional economic center with average income and wealth The city's tax base is strengthening supported by growing valuations and role as regional economic center. The base is diverse with a balanced mix of residential, commerical and industrial property. Two small universities and one small college lend some stability to the local economy bringing nearly 5,000 students to the city. Deer & Company-(A2 stable) is by far the largest employer with 2,600 employees. The company has been adding jobs at its Dubuque plant, where they manufacture forestry and construction equipment. Reflective of its regional role, the city is home to a number of large healthcare providers. The city's unemployment rate of 3.2% is materially lower than the national rate. The labor force, however, has not yet full recovered to its pre -pandemic peak. The city's full valuation has grown by nearly 20% since 2017 including a 7% increase in the most recent year. Current growth is being driven by multi -family housing, senior facilities and industrial investments. Financial operations and reserves: very healthy financial position The city's financial position will likely remain strong supported by solid revenue growth and revenue flexibility. The city had been expecting to use nearly $4 million in fiscal 2021 for capital projects and equipment. Instead of a decline, the general fund balance increased by over $9 million because of $13.2 million of American Rescue Act Funds (ARPA). For fiscal 2022 the city is planning to draw down fund balance by $13.3 million as it expends its ARPA funding on a variety of initiatives including sanitary sewer, broadband fiber and parks and recreation projects. At the close of fiscal 2021 the city's available reserves totaled about 50% of revenues with the majority held in the general fund. If the draw in reserves is fully realized, reserves will decline to closer to 35%. The city will be receiving another $13.2 million in ARPA funds, which could keep reserves higher depending of the timing of revenues and expenditures from the second allocation. This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history. 2 10 May 2022 Dubuque (City of) IA: Update to credit analysis Property taxes comprise slightly under half of operating revenues. While the city levies at the $8.10/$1,000 tax cap for general operations, it could access additional levies including an employee benefits levy that could be imposed to cover benefit costs including pensions, providing significant flexibility. A rollback of commercial and industrial assessments that was adopted in the last decade had been backfilled by the state, but that state support will be phased out over 8 years beginning in fiscal 2023 costing the city $1.3 million when fully implemented. A change in multi -family housing assessment that began in 2016 with an eight year phase out, will cost the city $5.7 million when fully phased in. Despite those hits to property taxes, the city's property tax revenue continues to grow at a steady clip each year as the tax base is growing at a robust pace offsetting those losses. The city also has the ability to increase property taxes to offset any decline if it chooses to. Officials typically try to keep the tax burden to the average homeowner relatively flat. Gaming revenues and local option sales tax receipts each comprise about 10% of revenues. Gaming receipts declined during 2020 at the outset of the pandemic, but have begun to recover (see exhibit). DuBuque's gaming revenues are derived from two casinos, the city -owned Q Casino (formally named the Mystique) and the privately owned Diamond Jo Casino. The city is projecting that gaming receipts will grow significantly going forward because it is set to receive a larger allocation of receipts. Revenue derived from the city's 1% local option sales tax, which does not sunset, is split 50/50 between the city operations and capital projects. Local option sales taxes have been growing significantly. Exhibit 2 Gaming taxes took a hit during the pandemic; other revenues proved resilient City of DuBuque revenue by fiscal year $12.0 $11.3 $10.0 m^ ^ $9.7 $8.0 0 = $6.0 E $4.0 $2.0 2018 2019 2020 ■2021 Local option sales tax Hotel I motel tax Gaming Source: Dubuque (City of) IA's financial statements and Moody's Investors Service Liquidity The district's cash position is higher than its fund balance primarily because of property taxes deferred to the next fiscal year. The city has alternate liquidity of $6.5 million in its internal service funds primarily in the health insurance and workers compensation reserve funds, which were funded primarily with general fund transfers. Debt and pensions: elevated debt and pension burdens The city's leverage has moderated somewhat in recent years, but is likely to grow given outstanding capital needs. The city is in the process of issuing just under $10 million of GO bonds to finance a variety of capital improvements including equipment purchases, facility improvements and urban renewal projects. Later this year, the city will likely issue no more than $15 million for improvements to its ice arena. The city is also considering approaching voters to approve a new civic center to replace the city's currently aging facility, and in the next few years could issue bonds to finance new fire station. The city pays for the majority of its general obligation (GO) debt with non -levy sources of operating revenue including tax increment, parking and utilities. Essential enterprises, such as water, sewer and storm water are anticipated to support nearly one half of the city's outstanding GO debt. The three funds also have a substantial amount of net revenue debt outstanding totaling just over $100 million. 10 May 2022 Dubuque (City of) IA: Update to credit analysis The city's direct debt burden includes TIF revenue bonds issued for various economic development projects, including the construction of a new public parking ramp at Diamond Jo Casino. The TIF revenue bonds are supported by revenues from the city's tax increment districts and backed by a minimum assessment agreement with the developer. Legal security The city's GOULT debt, including the current issuances, are backed by the city's unlimited taxing power. The city is required to levy ad valorem taxes upon all taxable property in the city without limit as to rate or amount sufficient to pay the debt service except to the extent that other monies are deposited in the debt service fund for such purposes. The city's moral obligation bonds (Annual Appropriation Tax Supported, Series 2015A) are secured by a senior lien on pledged sales tax increment revenues collected and distributed by the state. The bonds also benefit from a standby levy of debt service taxes which are subject to the city's moral obligation pledge to consider appropriating from its debt service levy to replenish the debt service reserve if it is drawn upon. Debt structure All of the city's debt is long term and fixed-rate. Debt -related derivatives The city is not a party to any derivative agreements. Pensions and OPEB Dubuque participates in two defined benefit multiple -employer cost -sharing plans, the Iowa Public Employees' Retirement System (IPERS) and Municipal Fire and Police Retirement Systems of Iowa. On an annual basis, the plans establish local government retirement contributions as a share of annual payroll based on actuarial requirements. Moody's ANPL uses the cost -sharing plan allocation of plan liabilities and fair market value of assets reported by the city under GASB 68 but reflects the use of the FTSE Pension Liability Index, a high investment -grade long-term taxable bond index, to value the plan's liabilities. While the plans' current discount rates are 7% for IPERS and 7.5% for fire and police, the FTSE Pension Liability Index used to value liabilities was 2.7% as of the plan's last measurement date. The city contributed to its pension plans per state requirements in fiscal 2021 in an amount just shy of our tread water indicator, the amount required to prevent the reported unfunded liability from growing if all plan assumptions are realized. The city's other post employment benefit liability is very small and stems from an implicit rate subsidy. ESG considerations Dubuque's ESG Credit Impact Score is neutral to low (CIS-2), reflecting moderately negative environmental risks, neutral to low exposure to social risk and positive governance profile. Environmental The city's E issuer profile score is moderately negative (E-3), reflecting physical climate risk because of its exposure to rainfall intensification which can cause water levels along the adjacent Mississippi River to rise, creating the potential for flooding. According to Moody's ESG solutions, the city is on the cusp of medium to high risk for floods. The city has been working on mitigating flooding risk with improvements to the Catfish and Bee Branch watersheds. The effort has been underway since 2001 with a projected completion of 2040. The city has received approximately $160 million in outside funds towards the nearly $240 million in estimated project costs. To date the project has included the installation of culverts, inlets, large diameter storm sewers, sewer connections, removing homes in the most problematic areas and other improvements. Projects that are currently underway or planned include a flood mitigation gate and pump replacement system, additional storm sewers, protection of a city water plant and additional green alleys. he city also benefits from several levies maintained by the US Army Corps of Engineers. The city's other environmental category scores reflect neutral to low risk, including carbon transition, natural resources management, and waste and pollution. Social The S issuer profile score is neutral to low (S-2). City demographics, educational attainment and labor market is similar to the nation. Residents have access to basic services. The city has been making investments to expand broadband access and projects that every business and resident will have access to high speed fiber broadband by the end of 2024. The city pays one-half of utility bills for low and moderate income residents, which is recorded as a transfer to the utilities. 10 May 2022 Dubuque (City of) IA: Update to credit analysis Governance The city's G issuer profile score is positive (G-1), incorporating a strong institutional framework that provides significant revenue raising flexibility and sound budget management supported by forecasting, a five year capital plan and reasonable budgeting of revenues. While Iowa cities are subject property tax caps on general and emergency levies, cities have strong revenue -raising flexibility due to various additional levies, including an unlimited levy for employee benefits. Dubuque's transparency and disclosure practices are sound with timely audit releases. The finance team regularly monitors variances in revenues and expenditure and management reports those findings to council. The city website includes separate monthly revenue and expenditure reports. While those reports do not include comparisons to the budget or prior year, the city has an interactive website that has comparative data relative to budget. 5 10 May 2022 Dubuque (City of) IA: Update to credit analysis Rating methodology and scorecard factors The US Local Government General Obligation Debt methodology includes a scorecard, a tool providing a composite score of a local government's credit profile based on the weighted factors we consider most important, universal and measurable, as well as possible notching factors dependent on individual credit strengths and weaknesses. Its purpose is not to determine the final rating, but rather to provide a standard platform from which to analyze and compare local government credits. Exhibit 3 Dubuque (City of) IA Rating Factors Measure Score Economy/Tax Base (30%)[1] Tax Base Size: Full Value (in 000s) $5,189,859 Aa Full Value Per Capita $89,400 Aa Median Family Income (% of US Median) 92.6% Aa Finances (30%) Fund Balance as a % of Revenues 45.2% Aaa 5-Year Dollar Change in Fund Balance as % of Revenues 27.8% Aaa Cash Balance as a % of Revenues 59.8% Aaa 5-Year Dollar Change in Cash Balance as % of Revenues 46.1% Aaa Institutional Framework Aaa Aaa Operating History: 5-Year Average of Operating Revenues / Operating Expenditures 1.0x A Debt and Pensions (20%) Net Direct Debt / Full Value (%) 2.4% A Net Direct Debt / Operating Revenues (x) 1Ax A 3-Year Average of Moody's Adjusted Net Pension Liability / Full Value (%) 3.7% A 3-Year Average of Moody's Adjusted Net Pension Liability / Operating Revenues (x) 2.3x A Scorecard -Indicated Outcome Aa2 Ratine Aaa [1] Economy measures are based on data from the most recent year available. [2] Notching Factors are specifically defined in the US Local Government General Obligation Debt methodology. [3] Standardized adjustments are outlined in the GO Methodology Scorecard Inputs publication. Sources: US Census Bureau, {OrgName}'s financial statements and Moody's Investors Service 6 10 May 2022 Dubuque (City of) IA: Update to credit analysis © 2022 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved. CREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT -LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY'S (COLLECTIVELY, "PUBLICATIONS") MAY INCLUDE SUCH CURRENT OPINIONS. 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REPORT NUMBER 1326876 10 May 2022 Dubuque (City of) IA: Update to credit analysis Contacts David Levett VP -Senior Analyst david.tevett@moodys.com MOODY'S INVESTORS SERVICE +1.312.706.9990 Thomas Jacobs Senior Vice President/ Manager thomas.jacobs@moodys.com CLIENT SERVICES +1.212.553.0131 Americas Asia Pacific Japan EMEA 1-212-553-1653 852-3551-3077 81-3-5408-4100 44-20-7772-5454 10 May 2022 Dubuque (City of) IA: Update to credit analysis DeaA Wire Inbox Parity Calendar Deal List \\(. D Upcoming Calendar'. Overview Result Excel Bernardi Securities, Inc. - Northfield , IL's Bid '�`��'• Dubuque $2,525,000 General Obligation Bonds, Series 2022A For the aggregate principal amount of $2,525,000,00, we will pay you $2.553,979.90, plus accrued interest from the date of issue to the date of delivery. The Bonds are to bear interest at the following rates : Maturity Date Amount $Coupon %Yield %Dollar Price 06/01/2024 105M 4.0000 2.5500 102.701 06/01/2025 105M _ 4.0000 2.7000 103.627 06/01/2026 105M 4.0000 2.8000 104.426 06/01/2027 110M 4.0000 2.9000 105.010 06/01/2028 110M 4.0000 3.0000 105,387 06/01/2029 115M 4.0000 3.1000 105.566 06/01/2030 125M 4.0000 13,1500 105.247 06/01/2031 125M 4.0000 3.2000 104.930 06/01/2032 130M 4,0000 3.3000 104.298 06/01/2033 130M 4.0000 3.4000 103.670 06/01/2034 135M 4.0000 3.5500 102.738 06/01/2035 06/01/2036 285M 4.0000 3.8000 101,204 06/01/2037 06101 /2038 06/0112039 06/01/2040 06101 /2041 06/01/2042 1 945M 4,1250 4.1500 99.660 Total Interest Cost: $1,209,233.82 Premium: $28,979.90 Net Interest Cost: $1,180,253.92 TIC: 3.937784 Time Last Bid Received On:05/16/2022 9:54:25 CDST This proposal is made subject to all of the terms and conditions of the Official Bid Form, the Official Notice of Sale, and the Preliminary Official Statement, all of which are made a part hereof. Bidder: Bernardi Securities, Inc., Northfield , IL Contact: Gineen Destefano Title: Telephone: 312-281-2019 Fax: Issuer Name: City o Dubuque Company Name: Accepted I ` Accepted By: Date: �[3a.-.r 1, aOaaDate. /,/e Wire Inbox Parity Calendar Deal List Upcoming Calendar Overview Result ,Excel, Robert W. Baird & Co., Inc. - Milwaukee, WI's Bid Dubuque $7,055,000 Taxable General Obligation Bonds, Series 2022E F:- For the aggregate principal amount of $7,055,000.00, we will pay you $7,000,860.75, plus accrued interest from the date of issue to the date of delivery. The Bonds are to bear interest at the follo inig rate(s): Maturity Date Amount $ Coupon % Yield % Dollar Price 06/01/2025 1 160M 4.0000 13.00001 102.775 06/01/2026 120M 4.0000 13.15001 103.111 06/01/2027 1 345M 1 4.0000 13.30001 103,154 06/01/2028 355M 1 4.0000 13.40001 103.191 06/01/2029 370M 4.o000 3.5000 103.047 06/01/2036 385M 4.0000 13.60001 102.429 06/01/2031 395M 4,0000 3.7000 101.814 06/01/2033 410M 4.0000 3.9000 100.599 06/01/2034 425M 4,0000 4,0006 100.000 06/01/2035 445M 4.1000 4.1000 100.000 06/01/2036 460M 4,2000 4,2000 100.000 06/01/2037 485M 4.3000 4,3000 100.000 06/01/2038 500M 4,4000 4.4000 100.000 06/01/2039 520M 4.5000 4.4500 100.291 06/01/2040 535M 1 4.6000 14.5000 100.585 06/01/2041 565M 1 4.6500 4.5500 100.584 06/01/2042 580M J 4.7000 14.6000, 100.583 Total Interest Cost: $3,980,270.42 Discount: $54,139.25 Net Interest Cost: $4,034,409.67 TIC: 4.414542 Time Last Bid Received On:05/16/2022 9:58:34 COST This proposal is made subject to all of the terms and conditions of the Official Bid Form, the Official Notice of Sale, and the Preliminary Official Statement, all of which are made a part hereof. Bidder: Robert W. Baird & Co., Inc., Milwaukee, WI Contact: Geoff Kuczmarski Title: Telephone:414-765-7331 Fax: Issuer Name: City of Dubuque Company Name: Accepted By: Accepted By: DateDate: CITY OF DUBUQUE, IOWA TABULATION OF BIDS TI IF CITY OF DUB E Masterpiece on the Mississippi $2,525,0001 General Obligation Bonds, Series 2022A Bernardi Securities, Inc. Northfield, IL Robert W, Baird & Co,. Inc Red Bank, NJ C.L. King Hoboken, NJ Collier Securities Minneapolis, MN FHN Fin Cap Mkts Memphin, TN Loop Capital New York, NY Crews & Associates Little Rock, AR Oppenheimer New York, NY SumRidge Partners Jersey City, NJ Northland Securities Minneapolis, MN Country Club Bank Leawood, KS Duncan -Williams Memphis, TN D.A. Davidson Denver, CO Seaport Global Boston, MA $2,553,979.90 $1,180,253.92 3.937784% 2,518,660.40 1,230,572.73 4.140277% Sierra Pacific Secs Los Angeles, CA Celadon Fin Group Morristown, NJ Midland Securities Montclair, NJ United Banker's Bank Bloomington, MN Commerce Bank, N.A. Kansas City, MO Isaak Bond Investments Denver, CO First Southern LLC Alphretta, GA Dinosaur Sec New York, NY First Bankers' Banc St. Louis, MO Mountainside Sec Summit, NJ Valdes & Moreno, Inc Kansas City, MO 1 Following the receipt of bids, the par amount was revised to $2,345,000, the purchase price was revised to $2,370,169.00, the net interest was revised to $1,110,402.90, and the true interest cost was revised to 3.949235%. Independent MINPage 1 1of2 © Public Advisors, LLC $7,055,0002 Taxable General Obligation Bonds, Series 2022B Robert W, Baird & Co,. Inc Milwaukee, WI C.L. King Hoboken, NJ Collier Securities Minneapolis, MN FHN Fin Cap Mkts Memphin, TN Loop Capital New York, NY Crews & Associates Little Rock, AR Oppenheimer New York, NY SumRidge Partners Jersey City, NJ Northland Securities Minneapolis, MN Country Club Bank Leawood, KS Duncan -Williams Memphis, TN D.A. Davidson Denver, CO Seaport Global Boston, MA Piper Sandler & Co Chicago, IL Stifel, Nicolaus & Co, Inc Birmingham, AL $7,000,860.75 $4,034,409.67 4.414542% Sierra Pacific Secs Los Angeles, CA Celadon Fin Group Morristown, NJ Midland Securities Montclair, NJ United Banker's Bank Bloomington, MN Commerce Bank, N.A. Kansas City, MO Isaak Bond Investments Denver, CO First Southern LLC Alphretta, GA Dinosaur Sec New York, NY First Bankers' Banc St. Louis, MO Mountainside Sec Summit, NJ Valdes & Moreno, Inc Kansas City, MO Bernardi Securities Northfield, IL 6,993,107.30 4,094,431.81 4.467623% 6,988,053.95 4,400,030.22 4.815128% z Following the receipt of bids, the par amount was revised to $7,220,000, the purchase price was revised to $7,164,488.50, the net interest was revised to $4,132,662.03, and the true interest cost was revised to 4.415230%. Independent MINPage 12of2 © Public Advisors, LLC Ahlers & Cooney, P.C. AHLERS COONEY Attorneys at Law 100 Court Avenue, Suite 600 A T T O R N E Y S Des Moines, Iowa 50309-2231 Phone: 515-243-7611 Fax: 515-243-2149 www.ahlerslaw.com May 2, 2022 VIA E-MAIL Ms. Jenny Larson Director of Finance & Budget City of Dubuque 50 West 13th Street Dubuque, Iowa 52001 Kristin B. Cooper 515.246.0330 kcooper@ahlerslaw.com RE: Dubuque, Iowa - $2,525,000* (Subject to Adjustment Pursuant to Terms of Offering) General Obligation Bonds, Series 2022A; and $7,055,000* (Subject to Adjustment Pursuant to Terms of Offering) Taxable General Obligation Bonds, Series 2022B Dear Jenny: We have now prepared procedures for the sale date (May 16, 2022) covering minutes of the reception of bids at 10:00 A.M. and the form of resolutions awarding the Bonds to the best bidder. Sealed bids for the above -referenced Bonds should be received and listed in the minutes. Any bids received by fax should be sealed in an envelope and opened with the sealed bids. After a final call for sealed bids, the bids should then be opened and the best bid recorded. Only sealed bids are permitted by the terms of sale. No oral bids should be considered. Once any sealed bids have been first opened, the PARITY® electronic bid system can be accessed and the best such bid noted. All bids should then be referred to the Council for award of the Bonds at the 6:30 P.M. meeting. Please print out and mail back original copies to my attention as well as electronic scans. If any questions arise, please do not hesitate to contact me. Very truly yours, Ahlers & Cooney, P.C. Kristin Billingsley Cooper FOR THE FIRM WISHARD & BAILY- 1888; GUERNSEY & BAILY- 1893; BAILY & STIPP - 1901; STIPP, PERRY, BANNISTER & STARZINGER- 1914; BANNISTER, CARPENTER, AHLERS & COONEY- 1950; AHLERS, COONEY, DORWEILER, ALLBEE, HAYNIE & SMITH - 1974; AHLERS, COONEY, DORWEILER, HAYNIE, SMITH & ALLBEE, P.C. -1990 May 2, 2022 Page 2 KBC:seb Enclosures cc: Adrienne N. Breitfelder, City of Dubuque (via e-mail w/enc.) Trish Gleason, City of Dubuque (via e-mail w/enc.) Tionna Pooler, Independent Public Advisors (via e-mail w/enc 02043124-1 \ 10422-221 STATE OF IOWA SS: DUBUQUE COUNTY CERTIFICATE OF PUBLICATION I, Kathy Goetzinger, a Billing Clerk for Woodward Communications, Inc., an Iowa corporation, publisher of the Telegraph Herald, a newspaper of general circulation published in the City of Dubuque, County of Dubuque and State of Iowa; hereby certify that the attached notice was published in said newspaper on the following dates: [IhyLIb7NA3'�a and for which the charge is 63.80 Subscribed to before me, a Notary lie in and for Dubuque County, Iowa, this 6th day of May, 2022 i Notary Piro,in and for Dubuque C unty, Iowa. NET p. EC 11 K mmission Humber 199859Comm. Exp. DEC i t, 2022 Ad text : CITY OF DUBUQUE, IOWA OFFICIAL NOTICE NOTICE OF BOND SALE Time and Place of Sealed Bids: Bids for the sale of Bonds of the City of Dubuque, State of Iowa, hereafter described, must be received at the office of the Director of Finance & Budget, City Hall, 50 West 13th Street, Dubuque, Iowa, 52001; Telephone: 563-589-4100 (the "Issuer") in accordance with the official Terms of Offering, on the 16th day of May, 2022. The bids will then be publicly opened and referred for action to the meeting of the City Council in conformity with the Terms of Offering. The Bonds: The Bonds to be offered are the following: GENERAL OBLIGATION BONDS, SERIES 2022A, in the amount of $2,525,000*, to be dated June 29, 2022 (the "2022A Bonds"). Bids to be received before 10:00 A.M.; and TAXABLE GENERAL OBLIGATION BONDS, SERIES 2022B, in the amount of $7,055,000*, to be dated June 29, 2022 (the 2022B Bonds). Bids to be received before 10:00 A.M. (collectively, the "Bonds") *Subject to principal adjustment pursuant to official Terms of Offering. Manner of Bidding: Open bids will not be received. Bids will be received in any of the following methods: - Sealed Bidding: Sealed bids may be submitted and will be received at the office of the Director of Finance & Budget, at City Hall, 50 West 13th Street, Dubuque, Iowa, 52001. - Electronic Internet Bidding: Electronic internet bids will be received at the office of the Director of Finance & Budget, at City Hall, 50 West 13th Street, Dubuque, Iowa, 52001. The bids must be submitted through the PARITY* competitive bidding system. - Electronic Facsimile/Email Bidding: Electronic facsimile or email bids will be received at City Hall, Dubuque, Iowa (facsimile number: (563) 589-4149) or via email to the City's Municipal Advisor (tionna@ipamuni.com). Electronic facsimile and email bids will be sealed and treated as sealed bids. Consideration of Bids: After the time for receipt of bids has passed, the close of sealed bids will be announced. Sealed bids will then be publicly opened and announced. Finally, electronic internet bids will be accessed and announced. Sale and Award: The sale and award of the Bonds will be held at the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa at a meeting of the City Council on the above date at 6:30 P.M. Official Statement: The Issuer has issued an Official Statement of information pertaining to the Bonds to be offered, including a statement of the Terms of Offering and an Official Bid Form, which is incorporated by reference as a part of this notice. The Official Statement may be obtained by request addressed to the City Clerk, City Hall, 50 West 13th Street, Dubuque, Iowa, 52001; Telephone: 563-589-4100 or the Issuer's Municipal Advisor, Independent Public Advisors, LLC, 5550 Wild Rose Lane, Suite 400, West Des Moines, Iowa, West Des Moines, Iowa, 50266 (telephone: 515-259-8193). Terms of Offering: All bids shall be in conformity with and the sale shall be in accordance with the Terms of Offering as set forth in the Official Statement. Legal Opinion: The Bonds will be sold subject to the opinion of Ahlers & Cooney, P.C., Attorneys of Des Moines, Iowa, as to the legality and their opinion will be furnished together with the printed Bonds without cost to the purchaser and all bids will be so conditioned. Except to the extent necessary to issue their opinion as to the legality of the Bonds, the attorneys will not examine or review or express any opinion with respect to the accuracy or completeness of documents, materials or statements made or furnished in connection with the sale, issuance or marketing of the Bonds. Rights Reserved: The right is reserved to reject any or all bids, and to waive any irregularities as deemed to be in the best interests of the public. By order of the City Council of the City of Dubuque, State of Iowa. Adrienne N. Breitfelder City Clerk, City of Dubuque, State of Iowa It 5/6