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General Obligation Urban Renewal Bonds ($12M)THE CITY OF Dui Masterpiece on the Mississippi TO: FROM: SUBJECT: DATE: The Honorable Mayor and City Council Members Michael C. Van Milligen, City Manager Dubuque kital All- America City II 111! 2012 Proceedings to Set Public Hearing on the Issuance of Not to Exceed $12,000,000 General Obligation Urban Renewal Bonds September 19, 2012 Budget Director Jennifer Larson recommends that a public hearing be set for October 15, 2012, on the proposition of selling not to exceed $12,000,000 in General Obligation Urban Renewal Bonds, the proceeds of which will be used to fund urban renewal project activities under the authority of Chapter 403 of the Code of Iowa and the Amended and Restate Urban Renewal Plans for Greater Downtown, Technology Park South and Dubuque Industrial Center Urban Renewal Areas, including those costs associated with projects in the City budget previously approved by the City Council including grants in the Greater Downtown Urban Renewal District for planning /design costs and facade improvements associated with projects or that do not apply for the Downtown Rehabilitation Loan Program; grants in the Greater Downtown Urban Renewal District for hiring a financial consultant based on the anticipated increase in projects to analyze the feasibility of projects that apply for the Downtown Rehabilitation Loan Program; loans /grants to new small businesses that may need additional assistance to start up their business in the Downtown Washington Neighborhood; improvements to the Mystique Community Ice Center including air conditioning, electrical improvements, ice decking, power factor correction device and generator; grants for rehabilitation and adaptive reuse of buildings in the Greater Downtown Urban Renewal District; funds to assist property owners in the Downtown Urban Renewal Area in making structural changes that make their properties more accessible; funds for an annual streetscape improvement program for historic districts located in targeted neighborhoods; a consultant to determine where the City should acquire properties for industrial growth; costs associated with the rail platform improvements for the Intermodal Center; renovation of second floor of the Multicultural Family Center as well as reconfiguration of the main entrance to the building, meeting rooms on first floor, installation of an elevator and a fire sprinkler system; a restroom that is Americans with Disabilities Act (ADA) compliant at 5th Street and Bluff; and constructing sidewalks at the McAleece Park and Recreation Complex. In addition, there are refundings of General Obligation Urban Renewal Bonds included in this debt issuance. These bond refundings include: General Obligation Urban Renewal Bonds Series 2005C for Dubuque Industrial Center West Expansion with interest savings of $69,621 over the next three years; General Obligation Urban Renewal Bonds Series 2006B for 5th and 3rd Street Ramps and Airport T- Hangars with interest savings of $35,855 over the next eight years; General Obligation Urban Renewal Bonds Series 2006C for Iowa Parking Ramp Improvements with interest savings of $191,514 over the next seven years; and General Obligation Urban Renewal Bonds Series 2007B for 5th and 3rd Street Ramps and Airport T- Hangars with additional interest cost of $18,603 over the next four years. The refunding of the parking portion of General Obligation Urban Renewal Bonds Series 2006B, 2006C and 2007B will allow the City to switch from tax - exempt bonds to taxable bonds to allow more flexibility on the use of the parking ramps including private parking arrangements. The refunding of the General Obligation Urban Renewal Bonds Series 2006B and 2006C result in savings totaling $227,369. Even though the refunding of General Obligation Urban Renewal Bonds Series 2007B results in additional interest cost of $18,603 over the next four years, the bonds will still be refunded to allow more flexibility on the use of the Fifth and Third Street parking ramps. Although the City is selling General Obligation Bonds to support the projects, repayments of the debt will be from tax increment revenues of the Greater Downtown Dubuque Industrial Center and Technology Park South Urban Renewal Areas as well as parking and airport fees. The borrowing is subject to the "reverse referendum" procedures, under which petitions may be filed prior to the hearing asking that the bond proposal be submitted to an election. To qualify, a petition must be signed by eligible electors equal to at least ten percent of the number who voted at the last regular municipal election (but not less than ten persons). Section 384.25 of the Code of Iowa provides that any resident or property owner of the City may appeal the decision to take additional action to issue the bonds, to the District Court of a county in which any part of the City is located, within 15 days after such additional action is taken, but that the additional action is final and conclusive unless the court finds that the Council exceeded its authority. I concur with the recommendation and respectfully request Mayor and City Council approval. Michael C. Van Milligen MCVM /jml Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Teri Goodmann, Assistant City Manager Jennifer Larson, Budget Director Kenneth TeKippe, Finance Director Masterpiece on the Mississippi TO: Michael C. Van Milligen, City Manager FROM: Jennifer Larson, Budget Director Dubuque kital All- America City II 111! 2012 SUBJECT: Proceedings to Set Public Hearing on the Issuance of Not to Exceed $12,000,000 General Obligation Urban Renewal Bonds DATE: September 19, 2012 INTRODUCTION The purpose of this memorandum is to recommend the setting of a public hearing on the proposal to issue General Obligation Urban Renewal Bonds, the proceeds of which will be used for urban renewal purposes of the City for projects in the City budget previously approved by the City Council. A letter from attorney Mark Cory detailing information on the bond hearing is enclosed. DISCUSSION Of the bond amount: • $150,000 is intended to provide grants in the Greater Downtown Urban Renewal District for planning /design costs and facade improvements associated with projects or that do not apply for the Downtown Rehabilitation Loan Program. • $100,000 is intended to provide grants in the Greater Downtown Urban Renewal District for hiring a financial consultant based on the anticipated increase in projects to analyze the feasibility of projects that apply for the Downtown Rehabilitation Loan Program. • $300,000 is intended to provide loans /grants to new small businesses that may need additional assistance to start up their business in the Downtown Washington Neighborhood. • $265,000 is intended to provide funds for improvements to the Mystique Community Ice Center including air conditioning ($75,000); electrical improvements ($30,000); ice decking ($50,000); power factor correction device ($10,000); and generator ($100,000). • $175,000 is intended to provide grants for rehabilitation and adaptive reuse of buildings in the Greater Downtown Urban Renewal District. • $25,000 is intended to provide funds to assist property owners in the Downtown Urban Renewal Area in making structural changes that make their properties more accessible. • $25,000 is intended to provide funds for an annual streetscape improvement program for historic districts located in targeted neighborhoods. • $150,000 is intended to provide funds to hire a consultant to determine where the City should acquire properties for industrial growth. • $250,000 is intended to provide funds for costs associated with the rail platform improvements for the Intermodal Center. • $1,400,000 is intended to provide funds for renovation of second floor of the Multicultural Family Center as well as reconfiguration of the main entrance to the building, meeting rooms on first floor, installation of an elevator and a fire sprinkler system. • $220,000 is intended to provide funds for a restroom that is Americans with Disabilities Act (ADA) compliant at 5th Street and Bluff. • $110,000 is intended to provide funds for constructing sidewalks at the McAleece Park and Recreation Complex. • $1,305,000 Refunding of General Obligation Urban Renewal Bonds Series 2005C for Dubuque Industrial Center West Expansion for purposes to achieve $69,621 in interest savings over the next three years. • $615,000 Refunding of General Obligation Urban Renewal Bonds Series 2006B for 5th and 3rd Street Ramps and Airport T- Hangars for purposes to achieve $35,855 in interest savings over the next seven years. • $3,015,000 Refunding of General Obligation Urban Renewal Bonds Series 2006C for Iowa Parking Ramp Improvements for purposes to achieve $191,514 interest savings over the next seven years. • $1,960,000 Refunding of General Obligation Urban Renewal Bonds Series 2007B for 5th and 3rd Street Ramps and Airport T- Hangars at a cost of $18,603 over the next three years. • $115,000 is intended to provide funds for bond issuance costs and • $1,820,000 to be a contingency for fluctuations in the bond market for interest rates, bond issuance costs and change in project costs. The refunding of the parking portion of General Obligation Urban Renewal Bonds Series 2006B, 2006C and 2007B will allow the City to switch from tax - exempt bonds to taxable bonds to allow more flexibility on the use of the parking ramps including private parking arrangements. The refunding of the General Obligation Urban Renewal Bonds Series 2006B and 2006C result in savings totaling $227,369. Even though the refunding of General Obligation Urban Renewal Bonds Series 2007B results in additional interest cost of $18,603 over the next four years, the bonds will still be refunded to allow more flexibility on the use of the Fifth and Third Street parking ramps. Although the City is selling General Obligation Bonds to support the projects, repayments of the debt will be from tax increment revenues of the Greater Downtown Dubuque Industrial Center and Technology Park South Urban Renewal Areas. The borrowing is subject to the "reverse referendum" procedures, under which petitions may be filed prior to the hearing asking that the bond proposal be submitted to an election. To qualify, a petition must be signed by eligible electors equal to at least ten percent of the number who voted at the last regular municipal election (but not less than ten persons). Section 384.25 of the Code of Iowa provides that any resident or property owner of the City may appeal the decision to take additional action to issue the bonds, to the District Court of a county in which any part of the City is located, within 15 days after such additional action is taken, but that the additional action is final and conclusive unless the court finds that the Council exceeded its authority. Careful review of the draft Official Statement by appropriate City staff and members of the City Council is an important step in the offering of the bonds for sale to the public. The U.S. Securities and Exchange Commission (the "Commission) has stated that "issuers are primarily responsible for the content of their disclosure documents and may be held liable under the federal securities laws for misleading disclosure." In several recent enforcement proceedings, the Commission has made clear that it expects public officials to generally review disclosure documents in light of their unique knowledge and perspectives on the issuer and its financial circumstances, or else to ensure that appropriate procedures are in place to provide the necessary review. RECOMMENDATION I respectfully recommend the adoption of the enclosed resolution fixing the date of October 15, 2012 for a public hearing on the proposition of selling not to exceed $12,000,000 in General Obligation Urban Renewal Bonds for urban renewal purposes and providing publication of notice. JML Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Teri Goodmann, Assistant City Manager Kenneth TeKippe, Finance Director AHLERS •COONEY, P.C. 100 COURT AVENUE. SUITE 600 DES MOINES. IOWA 50309 -2231 PHONE 515 - 243 -7611 FAX: 515 -243 -2149 WWW.AHLERSLAW.COM R. Mark Cory rcory@ahlerslaw.com September 19, 2012 Ms. Jenny Larson Budget Director City of Dubuque 50 West 13th Street Dubuque, Iowa 52001 Direct Dial: (515)246 -0378 RE: Not to exceed $12,000,000 General Obligation Urban Renewal Bonds Dear Ms. Larson: We have now prepared and are enclosing suggested proceedings to be acted upon by the Council in fixing the date of a meeting on the proposition to issue the above mentioned Bonds and ordering publication of a notice of hearing consistent with the provisions of Code Sections 384.24(3)(q) and 403.12. Notice of this meeting must be published at least once in a legal newspaper, printed wholly in the English language, published at least once weekly, and having general circulation in the City. The date of publication is to be not less than ten clear days before the date of the public meeting on the issuance of Bonds. In computing time, the date of publication should be excluded. If the last day falls on Sunday, the whole of the following Monday should be excluded. At any time before the date of the hearing, a petition may be filed with the Clerk requesting that the issuance of the Bonds be submitted to an election. To qualify, a petition must be signed by eligible electors equal to at least ten percent of the number who voted at the last regular municipal election (but not less than ten persons). The Council is required by statute to adopt the resolution instituting proceedings to issue the Bonds at the hearing - -or an adjournment thereof. Also enclosed is an extra copy of the proceedings to be filled in as the original and certified back to this office, together with publisher's affidavit of publication of notice of hearing. A certificate to attest the proceedings is also enclosed. 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 September 19, 2012 Page 2 We will prepare and forward to you in the near future, suggested procedure to be acted upon on the date of hearing. If you have any questions pertaining to the proceedings enclosed or the above instructions, please do not hesitate to either write or call. RMC:dc encl. cc: Ken TeKippe Tim Oswald 00893397 -1 \10422 -140 (This Notice to be posted) NOTICE AND CALL OF PUBLIC MEETING Governmental Body: The City Council of the City of Dubuque, Iowa. Date of Meeting: OctohPr 1 , 2012. Time of Meeting: 6: 30 o'clock P .M. Place of Meeting: Historic Federal Building, 350 West 6th Street, Dubuque, Iowa. PUBLIC NOTICE IS HEREBY GIVEN that the above mentioned governmental body will meet at the date, time and place above set out. The tentative agenda for the meeting is as follows: Not to exceed $12,000,000 General Obligation Urban Renewal Bonds • Resolution fixing date for a meeting on the proposition to issue. Such additional matters as are set forth on the additional 6 page(s) attached hereto. (number) This notice is given at the direction of the Mayor pursuant to Chapter 21, Code of Iowa, and the local rules of the governmental body. City r Jerk, City of I ubuq e State of Iowa October 1, 2012 The City Council of the City of Dubuque, Iowa, met in regular session, in the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa, at 6:30 o'clock P.M., on the above date. There were present Mayor Roy D. Buol in the chair, and the following named Council Members: Karla Braig, Joyce Connors, Ric Jones, Kevin Lynch David Resnick, Lynn Sutton Absent: 1 Council Member Jones introduced the following Resolution entitled "RESOLUTION FIXING DATE FOR A MEETING ON THE PROPOSITION OF THE ISSUANCE OF NOT TO EXCEED $12,000,000 GENERAL OBLIGATION URBAN RENEWAL BONDS (FOR URBAN RENEWAL PURPOSES) OF THE CITY OF DUBUQUE, IOWA, AND PROVIDING FOR PUBLICATION OF NOTICE THEREOF ",, and moved that the same be adopted. Council Member Resnick seconded the motion to adopt. The roll was called and the vote was, AYES:. Jones, Lynch, Resnick, Suttonb, Braig, Buol, Connors NAYS: Whereupon, the Mayor declared the resolution duly adopted as follows: RESOLUTION NO. 269-12 RESOLUTION FIXING DATE FOR A MEETING ON THE PROPOSITION OF THE ISSUANCE OF NOT TO EXCEED $12,000,000 GENERAL OBLIGATION URBAN RENEWAL BONDS (FOR URBAN RENEWAL PURPOSES) OF THE CITY OF DUBUQUE, IOWA, AND PROVIDING FOR PUBLICATION OF NOTICE THEREOF WHEREAS, it is deemed necessary and advisable that the City of Dubuque, Iowa, should issue General Obligation Urban Renewal Bonds, to the amount of not to exceed $12,000,000, as authorized by Sections 384.24(3)(q), 384.25 and 403.12, of the City Code of Iowa, for the purpose of providing funds to pay costs of carrying out urban renewal purpose projects as hereinafter described; and WHEREAS, before the bonds may be issued, it is necessary to comply with the provisions of the Code, and to publish a notice of the proposal to issue such bonds and of the time and place of the meeting at which the Council proposes to take action for the issuance of the bonds and to receive oral and /or written objections from any resident or property owner of the City to such action and the right to petition for an election. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: 2 Section 1. That this Council meet in the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa, at 6:30 o'clock P.M., on the 15th day of October, 2012, for the purpose of taking action on the matter of the issuance of not to exceed $12,000,000 General Obligation Urban Renewal Bonds, for urban renewal purposes of the City, the proceeds of which bonds will be used to provide funds to pay costs of aiding in the planning, undertaking, and carrying out of urban renewal projects under the authority of chapter 403, including Downtown Rehabilitation Grants, Downtown Rehabilitation Financial Consultant Grants, the Washington Neighborhood Business Loan Pool, a generator, air conditioning improvements, electrical improvements, ice decking, and a power factor correction device for the Mystique Community Ice Center, Downtown housing business incentives, ADA assistance, Historic District improvements, Industrial Park land acquisitions consultant costs, rail platform - Intermodal Facility, the Multicultural Family Center, a 5th & Bluff ADA restroom, McAleece Park sidewalks, and those costs associated with the repair, reconstruction and improvement of City parking ramps, and the refunding and refinancing of outstanding City indebtedness, including the General Obligation Urban Renewal Bonds, Taxable Series 2005C, the General Obligation Urban Renewal Bonds, Series 2006B, the General Obligation Refunding Bonds, Series 2006C, and the General Obligation Bonds, Series 2007B, issued for such purposes to achieve savings and facilitate the use of committed private parking arrangements in connection with future downtown development projects, and all of the purposes set out in Section 403.12. However, bonds issued for these purposes are subject to the right of petition for an election as provided in Section 384.26, without limitation on the amount of the bond issue or the size of the City, and the Council shall include notice of the right of petition in the notice required under Section 384.25, subsection 2. Section 2. That the Clerk is hereby directed to cause at least one publication to be made of a notice of said meeting, in a legal newspaper, printed wholly in the English language, published at least once weekly, and having general circulation in said City, said publication to be not less than ten clear days before the date of said public meeting on the issuance of said bonds. Section 3. To the extent any of the projects or activities described in this resolution may be reasonably construed to be included in more than one classification under Division III of the City Code of Iowa, the Council hereby elects the "urban renewal purpose" classification and procedure with respect to each such project or activity, pursuant to Section 384.28 of the City Code of Iowa. The Council will issue bonds to fund the projects or activities described in this resolution in multiple series, as appropriate. Section 4. The notice of the proposed action to issue the bonds shall be in substantially the following form: 3 NOTICE OF MEETING OF THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA, ON THE MATTER OF THE PROPOSED ISSUANCE OF NOT TO EXCEED $12,000,000 GENERAL OBLIGATION URBAN RENEWAL BONDS (FOR URBAN RENEWAL PURPOSES) OF THE CITY, AND THE HEARING ON THE ISSUANCE THEREOF PUBLIC NOTICE is hereby given that the City of Dubuque, Iowa, will hold a public hearing on the day of , 2012, at o'clock .M., in the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa, at which meeting the Council proposes to take additional action for the issuance of not to exceed $12,000,000 General Obligation Urban Renewal Bonds, for urban renewal purposes of said City, in order to provide funds to pay costs of aiding in the planning, undertaking, and carrying out of urban renewal projects under the authority of chapter 403, including Downtown Rehabilitation Grants, Downtown Rehabilitation Financial Consultant Grants, the Washington Neighborhood Business Loan Pool, a generator, air conditioning improvements, electrical improvements, ice decking, and a power factor correction device for the Mystique Community Ice Center, Downtown housing business incentives, ADA assistance, Historic District improvements, Industrial Park land acquisitions consultant costs, rail platform - Intermodal Facility, the Multicultural Family Center, a 5th & Bluff ADA restroom, McAleece Park sidewalks, and those costs associated with the repair, reconstruction and improvement of City parking ramps, and the refunding and refinancing of outstanding City indebtedness, including the General Obligation Urban Renewal Bonds, Taxable Series 2005C, the General Obligation Urban Renewal Bonds, Series 2006B, the General Obligation Refunding Bonds, Series 2006C, and the General Obligation Bonds, Series 2007B, issued for such purposes to achieve savings and facilitate the use of committed private parking arrangements in connection with future downtown development projects, and all of the purposes set out in Section 403.12. However, bonds issued for this purpose are subject to the right of petition for an election as provided in Section 384.26, without limitation on the amount of the bond issue or the size of the City, and the Council shall include notice of the right of petition in the notice required under Section 384.25, subsection 2. At any time before the date of said meeting, a petition, asking that the question of issuing such Bonds be submitted to the legal voters of said City, may be filed with the Clerk of said City in the manner provided by Section 362.4 of the Code of Iowa, pursuant to the provisions of Sections 403.12, 384.24(3)(q) and 384.25 of the Code of Iowa. At the above meeting the Council shall receive oral or written objections from any resident or property owner of the City, to the above action. After all objections have been received and considered, the Council will at this meeting or at any adjournment thereof, take additional action for the issuance of bonds or will abandon the proposal to issue bonds. 4 This notice is given by order of the City Council of the City of Dubuque, State of Iowa, as provided by Section 384.25 of the City Code of Iowa. Dated this day of , 2012. City Clerk, City of Dubuque, State of Iowa (End of Notice) 5 PASSED AND APPROVED this 1st day of October , 2012. ATTEST: •A%-,k7Arzatri 6 Mayor /7- 04, STATE OF IOWA COUNTY OF DUBUQUE CERTIFICATE ) • ) SS 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 corporate records of the City showing proceedings of the City 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 (a copy of the face sheet of the agenda being attached hereto) 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 City hereto affixed this 2nd day of October, 2012. (SEAL) 00893063 -1 \10422 -139 ii AO, / * City erk, City of k ubuqu -�r ate of Iowa CERTIFICATE STATE OF IOWA ) SS COUNTY OF DUBUQUE a IA V d d 1L, I, the undersigned, do hereby certify that I am now and was at the times hereinafter mentioned, the duly qualified and acting Clerk of the City of Dubuque, in the County of Dubuque, State of Iowa, and that as such Clerk and by full authority from the Council of the City, I have caused a NOTICE OF MEETING OF THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA, ON THE MATTER OF THE PROPOSED ISSUANCE OF NOT TO EXCEED $12,000,000 GENERAL OBLIGATION URBAN RENEWAL BONDS (FOR URBAN RENEWAL PURPOSES) OF THE CITY, AND THE HEARING ON THE ISSUANCE THEREOF of which the clipping annexed to the publisher's affidavit hereto attached is in words and figures a correct and complete copy, to be published as required by law in the Telegraph Herald, a legal newspaper published at least once weekly, printed wholly in the English language, published regularly and mailed through the post office of current entry for more than two years and which has had for more than two years a bona fide paid circulation recognized by the postal laws of the United States, and has a general circulation in the City, and that the Notice was published in all of the issues thereof published and circulated on the following date: October 3 , 2012. WITNESS my official signature at Dubuque, Iowa, this day of , 2012. (SEAL) 00893095 -1\10422 -140 f■' — i City • er , City of u • *Fr e, State of Iowa City of Dubuque, Iowa Masterpiece on the Mississippi Dubuque ■FYII�E� '1111' S7,340,000* Taxable General Obligation Refunding Bonds, Series 2012I (FAST Closing) (Book Entry Only) (Parity Bidding Available) DATE: Monday, November 5, 2012 TIME: 1:00 PM PLACE: Office of the Budget Director 50 W. 13th Street Dubuque, IA 52001 -4864 Telephone: (563)589 -4100 Fax: (563)589 -0890 Moody's Rating: " * Preliminary, subject to change PiperJaffraym 3900 Ingersoll Ave., Suite 110 Des Moines, IA 50312 515/247 -2355 OFFICIAL BID FORM TO: City Council of Dubuque, Iowa (the "Issuer ") Re: $7,340,000* Taxable General Obligation Refunding Bonds, Series 20121 dated Date of Delivery, of the Issuer (the "Bonds") For all or none of the above Bonds, in accordance with the notice of sale, we will pay you $ for Bonds bearing interest rates and maturing on June 1 in each of the stated years as follows: Coupon Yield Due June 1st Coupon Yield Due June 1st 2013 2018 2014 2019 2015 2020 2016 2021 2017 We hereby elect to have the following issued as term bonds: Principal Amount Month and Year (Inclusive) $ to $ to $ to $ to Subject to mandatory redemption requirement in the amounts and at the times shown above We will not elect to have any bonds issued as term bonds Maturity Month and Year This bid is for prompt acceptance and for delivery of said Bonds to use in compliance with the Official Notice of Sale and Official Terms of Offering of Taxable General Obligation Refunding Bonds, which is made a pert of this proposal, by reference. Award will be made on a True Interest Cost Basis (TIC). In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph (b)(5) of Rule 15c2 -12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Rule "), the Issuer will covenant and agree, for the benefit of the registered holders or beneficial owners from time to time of the outstanding Bonds, in the Bond Resolution, to provide annual reports of specified information and notice of the occurrence of certain events, if material, as hereinafter described (the "Disclosure Covenants "). The information to be provided on an annual basis, the events as to which notice is to be given, if material, and a summary of other provisions of the Disclosure Covenants, including termination, amendment and remedies, are set forth in Appendix C to this Official Statement. According to our computations (the correct computation being controlling in the award), we compute the following (to the dated date): NET INTEREST COST:$ TRUE INTEREST RATE (Computed from the dated date) Account Manager Signature of Account Manager The foregoing offer is hereby accepted by and on behalf of the City Council of Dubuque, in the county of Dubuque, State of Iowa, this 5th day of November, 2012. ATTEST: City Clerk Mayor Preliminary, subject to change NOTICE OF BOND SALE OFFICIAL TERMS OF OF'F'ERING In addition to the provisions of the official notice of bond sale, this section sets forth the description of certain terms of the Bonds as well as the terms of offering with which all bidders and bid proposals are required to comply, as follows: The Bonds. The Bonds to be offered are the following: TAXABLE GENERAL OBLIGATION REFUNDING BONDS, Series 2012I in the principal amount of $7,340,000* dated Date of Delivery in the denomination of $5,000 or multiples thereof, and maturing as shown on the front page of the official statement * Adjustment to Principal Amount After Determination of Best Bid Each scheduled maturity of the Bonds are subject to increase or decrease. Such adjustments shall be made promptly after the sale and prior to the award of bids by the issuer and shall be in the sole discretion of the Issuer. The Issuer shall only make such adjustments in order to size the Bonds to provide for the Project. To cooperate with any adjustment in the principal amounts, the Successful Bidder is required, as a part of its bid, to indicate its Initial Reoffering yield and Initial Reoffering price on each maturity of the Bonds (said price shall be calculated to the date as indicated by the Issuer). The dollar amount bid by the Successful Bidder may be changed if the aggregate principal amount of the Bonds, as adjusted as described below, is adjusted, however the interest rates specified by the Successful Bidder for all maturities will not change. The Issuer's financial advisor will make every effort to ensure that the percentage net compensation to the Successful Bidder (the percentage resulting from dividing (i) the aggregate difference between the offering price of the Bonds to the public and the price to be paid to the Issuer (not including accrued interest), less any bond insurance premium and credit rating fee, if any, to be paid by the Successful Bidder, by (ii) the principal amount of the Bonds) does not increase or decrease from what it would have been if no adjustment was made to principal amounts shown in the maturity schedule. The Successful Bidder may not withdraw or modify its bid once submitted to the Issuer for any reason, including post bond adjustment Any adjustment shall be conclusive, and shall be binding upon the Successful Bidder. Optional Redemption: The Bonds maturing in the years 2019 -2020, may be called for redemption by the Issuer and paid before maturity beginning June 1, 2018 or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot The terms of redemption shall be par, plus accrued interest to date of call. Interest: Interest on said Bonds will be payable on June 1, 2013 and semiannually on the 1st day of June and December thereafter. Interest shall be payable by check or draft of the Paying Agent mailed to the persons who were registered owners thereof as of the fifteenth day of the month immediately preceding the Interest Payment Date (the "Record Date "), to the addresses appearing on the registration books maintained by the Paying Agent or to such other address as is furnished to the Paying Agent in writing by a registered owner. Interest will be computed on the basis of a 360 -day year of twelve 30 -day months and will be rounded pursuant to rules of the Municipal Securities Rulemaking Board. Book Entry System: The Bonds will be issued by means of a book entry system with no physical distribution of certificates made to the public. The Bonds will be issued in fully registered form and one certificate, representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the Issuer to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of such participants and other nominees of beneficial owners. The successful bidder, as a condition of delivery of the Bonds, will be required to deposit the certificates with DTC. Good Faith Deposit: A Good Faith Deposit (Deposit ") is not required for this issue. Form of Bids: All bids shall be unconditional for the entire issue of Bonds for a price of not less than $73,400, plus accrued interest, and shall specify the rate or rates of interest in conformity to the limitations set forth herein Bids must be submitted on or in substantial compliance with the Official Bid Form provided by the Issuer or through the Internet Bid System. The Issuer shall not be responsible for any malfunction or mistake made by any person, or as a result of the use of the electronic bid, facsimile facilities or the means used to deliver or complete a bid. The use of such facilities or means is at the sole risk of the prospective bidder who shall be bound by the terms of the bid as received. No bid will be received after the time specified in the Notice of Sale. The time as maintained by the Internet Bid System shall constitute the official time with respect to all Bids submitted. A bid may be withdrawn before the bid deadline using the same method used to submit the bid If more than one bid is received from a bidder, the last bid received shall be considered. Sealed Bidding: Sealed bids may be submitted and will be received at the office of Budget Director, 50 W. 13th Street, Dubuque, IA 52001 -4864. Internet Bidding: Internet bids must be submitted through Parity® ( "the Internet Bid System"). Information about the Internet Bid System may be obtained by calling 212 - 849 -5000. Each bidder shall be solely responsible for making necessary arrangements to access the Internet Bid System for purpose of submitting its intemet bid in a timely manner and in compliance with the requirements of the Official Terms of Offering. The Issuer is permitting bidders to use the services of the Internet Bid System solely as a communication mechanism to conduct the intemet bidding and the Inter net Bid System is not an agent of the Issuer. Provisions of the Official Terms of Offering shall control in the events of conflict with information provided by the Internet Bid System. The Issuer shall not be responsible for any malfunction or mistake made by any person, or as a result of the use of the Internet Bid System. The use of such facilities or means is at the sole risk of the prospective bidder who shall be bound by the terms of the bid as received. Electronic Facsimile Bidding: Bids may be submitted via facsimile at the phone number listed on the front cover of this Preliminary Official Statement. Electronic facsimile bids will be sealed and treated as sealed bids. Transmissions received after the deadline shall be rejected. It is the responsibility of the bidder to ensure that the bid is legible, that the bid is received prior to the appointed time, and that the bid is sent to the telecopier number set forth above. The Financial Advisor will, in no instance correct, alter, or in any way change bids submitted through facsimile transmission. Neither the Issuer nor its agents will be responsible for bids submitted by facsimile transmission not received in accordance with the provisions of this Official Terms of Offering. Bidders electing to submit bids via facsimile transmission will bear full and complete responsibility for the transmission of such bid. Neither the Issuer nor its agents will assume liability for the inability of the bidder to reach the above name fax number prior to the time of sale specified above. Time of receipt shall be the time recorded by the facsimile operator. Rates of Interest: The rates of interest specified in the bidder's proposal must conform to the limitations following: All Bonds of each annual maturity must bear the same interest rate. Rates of interest bid may be in multiples of 1 /8th 1 /20th or 1 /100th of 1 %. Rates must be in level or ascending order. Delivery: The Bonds will be delivered to the Purchaser via FAST delivery with the Paying Agent holding the Bonds on behalf of DTC, against full payment in immediately available cash or federal funds. The Bonds are expected to be delivered within sixty days after the sale. Should delivery be delayed beyond sixty days from date of sale for any reason except failure of performance by the Purchaser, the Purchaser may withdraw his bid and thereafter his interest in and liability for the Bonds will cease. (When the Bonds are ready for delivery, the Issuer may give the successful bidder five working days' notice of the delivery date and the Issuer will expect payment in full on that date, otherwise reserving the right at its option to determine that the bidder has failed to comply with the offer of purchase.) Certificate of Purchaser: The Purchaser of the Bonds will be required as a condition of the sale to execute and submit to the Issuer as a part of its bid, a Certificate in a form satisfactory to the Issuer as to the initial offering price of the Bonds to the public (not including 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 Bonds (not less than 10% of each maturity) were in fact sold, and certifying that the prices are not greater than as shown on the Certificate and that the prices are not unreasonably low. Official Statement: The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts, and interest rates of the Bonds, and any other information required by law or deemed appropriate by the Issuer, shall constitute a "Final Official Statement" of the Issuer with respect to the Bonds, as that term is defined in Rule 15c2 -12 of the Securities and Exchange Commission (the "Rule"). By awarding the Bonds to any underwriter or underwriting syndicate submitting an Official Bid Form therefore, the Issuer 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 Bonds are awarded up to 25 copies of the Official Statement and the addendum described in the preceding sentence to permit each "Participating Underwriter" (as that term is defined in the Rule) to comply with the provisions of such Rule. The Issuer shall treat the senior managing underwriter of the syndicate to which the Bonds 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 Bonds agrees thereby that if its bid is accepted by the Issuer, (i) it shall accept such designation and (ii) it shall enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring the receipt by each such Participating Underwriter of the Final Official Statement. CUSIP Numbers: It is anticipated that CUSIP numbers will be printed on the Bonds. In no event will the Issuer be responsible for or Bond Counsel review or express any opinion of the correctness of such numbers, and incorrect numbers on said Bonds shall not be cause for the purchaser to refuse to accept delivery of the Bonds. The fee will be paid for by the Issuer. Responsibility of Bidder: It is the responsibility of the bidder to deliver its signed, completed bid prior to the time of sale as posted on the front cover of the official statement and in the Official Notice of Sale. Neither the Issuer nor its Financial Consultant will assume responsibility for the collection of or receipt of bids. Bids received after the appointed time of sale will not be opened. Continuing Disclosure: In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph (b)(5) of Rule 15c2 -12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Rule "), the Issuer will covenant and agree, for the benefit of the registered holders or beneficial owners from time to time of the outstanding Bonds, in the Bond Resolution, to provide annual reports of specified information and notice of the occurrence of certain events, if material, as hereinafter described (the "Disclosure Covenants "). The information to be provided on annual basis, the events as to which notice is to be given, if material, and a summary of other provisions of the Disclosure Covenants, including termination, amendment and remedies, are set forth in Appendix C to this Official Statement Breach of the Disclosure Covenants will not constitute a default or an "Event of Default" under the Bonds or Resolution. A broker or dealer is to consider a known breach of the Disclosure Covenants, however, before recommending the purchase or sale of the Bonds in the secondary market Thus, a failure on the part of the Issuer to observe the Disclosure Covenants may adversely affect the transferability and liquidity of the Bonds and their market price. The Issuer has never failed to comply with the Rule Bond Insurance: Application has not been made for municipal bond insurance. Should the Bonds qualify for the issuance of any policy of municipal bond insurance or commitment therefore at the option of the bidder, the purchase of any such insurance policy or the issuance of any such commitment shall be at the sole option and expense of the Purchaser. Any increased costs of issuance on the Bonds resulting from such purchase of insurance shall be paid by the Purchaser, except that, if the Issuer has requested and received a rating on the Bonds from a municipal bond rating service, the Issuer will pay that rating fee. Any other rating service fees shall be the responsibility of the Purchaser. Requested modifications to the Issuance Resolution or other issuance documents shall be accommodated by the Issuer at its sole discretion. In no event will modifications be made regarding the investment of funds created under the Issuance Resolution or other issuance documents without prior Issuer consent, in its sole discretion. Either the purchaser or the insurer must agree, in the insurance commitment letter or separate agreement acceptable to the Issuer in its sole discretion, to pay any future continuing disclosure costs of the Issuer associated with any rating changes assigned to the municipal bond insurer after closing (for example, if there is a rating change on the municipal bond insurer that require a material event notice filing by the Issuer, the purchaser or the municipal bond insurer must agree to pay the reasonable costs associated with such filing). Failure of the municipal bond insurer to issue the policy after the Bonds have been awarded to the Purchaser shall not constitute cause for failure or refusal by the Purchaser to accept delivery of the Bonds. .5 O. . -0 '1 o L :E. .s E 4 u� .5 o 4 o6 R.5 g JZ o . r, ° 5 0 _ 'S E .0 0 0 °a E -C • 0 o a 5 0 � o P 0th o° E▪ ° S 6 dtj 00 0 • 8 . g PRELIMINARY OFFICIAL STATEMENT DATED , 2012 NEW ISSUE - DTC BOOK ENTRY ONLY Moody's Rating: "" Subject to compliance by the Issuer with certain covenants, in the opinion ofAhlers & Cooney, P.C., under present laws, interest on the Bonds is included from gross income for federal income tax purposes. See "THE BONDS — Tax Matters" herein City of Dubuque, Iowa THE CITY OF i / , \ Dubuque DUB bawl ll II Masterpiece on the Mississippi 2012 $7,340,000 Taxable General Obligation Refunding Bonds Series 2012I Dated: Date of Delivery * The Taxable General Obligation Refunding Bonds described above (the "Bonds ") are issuable as fully registered Bonds in the denomination of $5,000 or any integral multiple thereof and, when issued, will be registered in the name of Cede & Co., as Bondholder and nominee of the Depository Trust Company, New York, NY ( "DTC "). DTC will act as securities depository for the Bonds. Purchases of the Bonds will be made in book -entry form. Purchasers of the Bonds will not receive certificates representing their interest in the Bonds purchased. So long as DTC or its nominee, Cede & Co., is the Bondholder, the principal of, premium, if any, and interest on the Bonds will be paid by Wells Fargo Bank N.A. as Registrar and Paying Agent (the "Registrar "), or its successor, to DTC, or its nominee, Cede & Co. Disbursement of such payments to the Beneficial Owners is the responsibility of the DTC Participants as more fully described herein. Neither the Issuer nor the Registrar will have any responsibility or obligation to such DTC Participants, indirect participants or the persons for whom they act as nominee with respect to the Bonds. Interest on the Bonds is payable on June 1, and December 1 in each year, beginning June 1, 2013 to the registered owners thereof. Interest shall be payable by check or draft of the Paying Agent mailed to the persons who were registered owners thereof as of the fifteenth day of the month immediately preceding the Interest Payment Date, to the addresses appearing on the registration books maintained by the Paying Agent or to such other address as is famished to the Paying Agent in writing by a registered owner. The Bonds maturing in the years 2019 -2020, may be called for redemption by the Issuer and paid before maturity beginning June 1, 2018 or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an • annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. MATURITY SCHEDULE * Bond Due Amount * Rate * Yield * Ctusip Nurn. ** Bonds Due Amount * Rate * Yield * Cusip Num.* * :15 June 1, 2013 $1,000,000 June 1, 2018 $780,000 June 1, 2014 1,095,000 June 1, 2019 775,000 June 1, 2015 1,110,000 June 1, 2020 660,000 . b June 1, 2016 1,105,000 June 1, 2021 50,000 8 S June 1, 2017 765,000 a 5 • ` o The Bonds are being offered when, as and if issued by the Issuer and accepted by the Underwriter, subject to receipt of an opinion as to legality, • ,o validity and tax exemption by Ahlers & Cooney P.C. Des Moines, Iowa, Bond Counsel. It is expected that the Bonds in the definitive form will be available for delivery on or about December 4, 2012. The Underwriter intends to engage in secondary market trading of the Bonds subject to .f." applicable securities laws. The Underwriter is not obligated, however, to repurchase any of the Bonds at the request of the holder thereof c1 o .5�.8 g • ** CUSIP numbers shown above have been assigned by a separate organization not affiliated with the Issuer. The Issuer has not selected nor is responsible for selecting the CUSIP numbers assigned to the Bonds nor do they make any representation as to the correctness of such CUSIP numbers on 4 A . the Bonds or as indicated above. $,000 * %Term Bond dui priced to yield % CUSIP Number ** The Date of this Official Statement is , 2012 Preliminary, subject to change No dealer, salesman or any other person has been authorized to give any information or to make any representations other than those contained in this Official Statement, and if given or made, such information or representations must not be relied upon as having been authorized by the Issuer or the Underwriter. This Official Statement does not constitute an offer to sell or a solicitation of any offer to buy any of the securities offered hereby in any state to any persons to whom it is unlawful to make such offer in such state. Except where otherwise indicated, this Official Statement speaks as of the date hereof. Neither the delivery of this Official Statement nor any sale hereunder shall under any circumstances create any implication that there has been no change in the affairs of the Issuer since the date hereof TABLE OF CONTENTS INTRODUCTORY STATEMENT THE BONDS APPENDIX A - GENERAL INFORMATION ABOUT THE ISSUER APPENDIX B - FORM OF LEGAL OPINION APPENDIX C - FORM OF CONTINUING DISCLOSURE CERTIFICATE APPENDIX D - AUDITED FINANCIAL STATEMENTS OF THE ISSUER IN CONNECTION WITH THIS Orr ERING, THE UNDERWRITER MAY EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. This Official Statement is not to be construed as a contract with the purchasers of the Bonds. The Issuer considers the Official Statement to be `hear final" within the meaning of Rule 15c2 -12 of the Securities Exchange Commission. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so described herein, are intended solely as such and are not to be construed as a representation of facts. THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION BY REASON OF THE PROVISIONS OF SECTIONS 3(a)(2) OF THE SECURITIES ACT OF 1933, AS AMENDED. THE REGISTRATION OR QUALIFICATIONS OF THESE SECURITIES IN ACCORDANCE WITH APPLICABLE PROVISIONS OF SECURITIES LAWS OF THE STATES IN WHICH THESE SECURITIES HAVE BEEN REGISTERED OR QUALIFIED AND THE EXEMPTION FROM REGISTRATION OR QUALIFICATION IN OTHER STATES SHALL NOT BE REGARDED AS A RECOMMENDATION THEREOF. NEITHER THESE STATES NOR ANY OF THEIR AGENCIES HAVE PASSED UPON THE MERITS OF THE SECURITIES OR THE ACCURACY OR COMPLETENESS OF THIS OFFICIAL STATEMENT. ANY REPRESENTATION TO THE CONTRARY MAY BE A CRIMINAL OFFENSE. FORWARD-LOOKING STATEMENTS This Official Statement, including Appendix A, contains statements which should be considered "forward - looking statements," meaning they refer to possible future events or conditions. Such statements are generally identifiable by the words such as "plan," "expect," "estimate," "budget" or similar words. THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD - LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD - LOOKING STATEMENTS. THE CITY DOES NOT EXPECT OR INTEND TO UPDATE OR REVISE ANY FORWARD - LOOKING STATEMENTS CONTAINED HEREIN IF OR WHEN ITS EXPECTATIONS, OR EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH SUCH STATEMENTS ARE BASED OCCUR. OFFICIAL STATEMENT $7 ,340,000* TAXABLE GENERAL OBLIGATION REFUNDING BONDS SERIES 2012I CITY OFDUBUQUE, IOWA INTRODUCTORY STATEMENT This Official Statement presents certain information relating to Dubuque, Iowa (the "Issuer "), in connection with the sale of the Issuer's Taxable General Obligation Refunding Bonds (the `Bonds "). The Bonds are being issued to provide fiords for the advance refunding of the City's outstanding General Obligation Bonds, Series 2005C, dated April 1, 2005 and General Obligation Bonds, Series 2006B and Series 2006C, dated May 2, 2006, General Obligation Bonds, Series 2007B, dated December 1, 2007 and paying the costs associated with the issuance of the Bonds. See "THE BONDS - Sources and Uses of Funds" herein. This Official Statement is deemed to be a final official statement within the meaning of Rule 15c2 -12 of the Securities and Exchange Commission, except for the omission of certain pricing and other information which is to be made available through a final Official Statement. This Introductory Statement is only a brief description of the Bonds and certain other matters. Such description is qualified by reference to the entire Official Statement and the documents summarized or described herein This Official Statement should be reviewed in its entirety. The Bonds are general obligations of the Issuer, payable from and secured by a continuing annual ad- valorem tax levied against all of the property valuation of the Issuer. See "THE BONDS — Source of Security for the Bonds" herein. All statements made in this Official Statement involving matters of opinion or of estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates will be realized. THE BONDS General The Bonds are dated as of Date of Delivery and will bear interest at the rates to be set forth on the cover page herein, interest payable on June 1 and December 1 in each year, beginning on June 1, 2013, calculated on the basis of a year of 360 days and twelve 30-day months. Interest shall be payable by check or draft of the Paying Agent mailed to the persons who were registered owners thereof as of the fifteenth day of the month immediately preceding the Interest Payment Date, to the addresses appearing on the registration books maintained by the Paying Agent or to such other address as is furnished to the Paying Agent in writing by a registered owner. Authority and Purpose The Bonds are being issued pursuant to the Code of Iowa, 2011 as amended, Section 384.25, and resolutions to be adopted by the City Council of the City. Proceeds of the 2012I Bonds will be used to provide funds to pay costs of refunding and refinancing of certain City indebtedness, including General Obligation Bonds, Series 2005C, dated April 1, 2005 (the 2005C Bond Issue), General Obligation Bonds, Series 2006B and Series 2006C, dated May 2, 2006 (the 2006B & C Bond Issue) and General Obligation Bonds, Series 2007B, dated December 1, 2007. Book Entry Only System The following bnfonnafion concerning The Depository Trust Company ( "DTC "), New York New York and DTC's book -entry system has been obtained from sources the Issuer believes to be reliable. However, the Issuer takes no reponsibiliry as to the accuracy or completeness thereof and neither the haired Participants nor the Beneficial Owners should rely on the following information with respect to such matters but should instead confirm the same with DTC or the Direct Participants, as the case may be. There can be no assurance that DTC will abide by its procedures or that such procedures will not be changedfrom time to time. The Depository Trust Company ("DTC"), New York, NY will act as securities depository for the securities (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 fully- registered Security certificate will be issued for the Securities in the aggregate principal amount of such issue, and will be deposited with DTC. Preliminary, subject to change 1 DTC, the world's largest depository, is a limited- purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A 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, corporate and municipal debt issues and money market instrument 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 Participations 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. 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 in the transaction. Transfers of ownership interest 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 in Securities, except in the event that use of the book -entry system for the Securities is discontinued 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 nominee do not affect 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. 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 govemed 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 transmission to them 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 have 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 the notices by provided directly to them.] 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 Participants in such issue to be redeemed. Neither DTC nor Cede & Co. (nor such other DTC nominee) will consent or vote with respect to the Securities unless authorized by a Direct Participant in accordance with DTC's Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to Issue as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). 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 Issuer or Agent on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be govemed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC (nor its nominee), Agent, or Issuer, 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 Issuer or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to Beneficial Owners will be the responsibility of Direct and Indirect Participants. 2 A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant, to [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 [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 [Tender/Remarketing] Agent's DTC account. DTC may discontinue providing its services as securities depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent Under such circumstances, in the event that a successor securities depository is not obtained, Security certificates are required to be printed and delivered Issuer may decide to discontinue use of the system of book- entry-only transfers through DTC (or successor securities depository). In that event Security certificates will be printed and delivered to DTC. The Issuer cannot and does not give any assurances that DTC, the Direct Participants or the Indirect Participants will distribute to the Beneficial Owners of the Bonds (i) payments of principal of or interest and premium, if any, on the Bonds, (ii) certificates representing an ownership interest or other confirmation of beneficial ownership interest in the Bonds, or (iii) redemption or other notices sent to DTC or Cede & Co., its nominee, as the Registered Owner of the Bonds, or that they will do so on a timely basis, or that DTC, Direct Participants or Indirect Participants will serve and act in the manner described in this Official Statement. The current "Rules" applicable to DTC are on file with the Securities Exchange Commission, and the current "Procedures" of DTC to be followed in dealing with Direct Participants are on file with DTC. Neither the Issuer nor the Paying Agent/Trustee will have any responsibility or obligation to any Direct Participant, Indirect Participant or any Beneficial Owner or any other person with respect to: (1) the accuracy of any records maintained by DTC or any Direct Participant or Indirect Participant; (2) the payment by DTC or any Direct Participant or Indirect Participant of any amount due to any Beneficial Owner in respect of the principal or redemption price of or interest on the Bonds; (3) the delivery by DTC or any Direct Participant or Indirect Participant of any notice to any Beneficial Owner which is required or permitted under the terms of the Indenture to be given to owners of Bonds; (4) the selection of the Beneficial Owners to receive payment in the event of any partial redemption of the Bonds; or (5) any consent given or other action taken by DTC as a Bondholder. Transfer and Exchange In the event that the Book Entry System is discontinued, any Bond may, in accordance with its terms, be transferred by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation at the principal corporate office of the Registrar accompanied by delivery of a duly executed written instrument of transfer in a form approved by the Registrar. Whenever any Bond or Bonds shall be surrendered for transfer, the Registrar shall execute and deliver a new Bond or Bonds of the same maturity, interest rate, and aggregate principal amount. Bonds may be exchanged at the principal corporate office of the Registrar for a like aggregate principal amount of Bonds or other authorized denominations of the same maturity and interest rate; provided, however, that the Registrar is not required to transfer or exchange any Bonds which have been selected for prepayment and is not required to transfer or exchange any Bonds during the period beginning 15 days prior to the selection of Bonds for prepayment and ending the date notice of prepayment is mailed. The Registrar may require the payment by the Bond Owner requesting such exchange of any tax or other govenuuental charge required to be paid with respect to such exchange. All Bonds surrendered pursuant to the provisions of this and the preceding paragraph shall be canceled by the Registrar and shall not be redelivered. Optional Redemption Optional Redemption. The Bonds maturing after June 1, 2018, may be called for redemption by the Issuer and paid before maturity on said date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Mandatory Sinking Fund Redemption The Bonds maturing on are subject to mandatory redemption (by lot, as selected by the Registrar) on 1 and in each of the years through at a redemption price of 100% of the principal amount thereof to be redeemed, plus accrued interest thereon to the redemption date in the following principal amounts: Term Bond Mandatory Sinking Fund Date Principal Amount (maturity) 3 Selection of Bonds for Redemption Bonds subject to redemption will be selected in such order of maturity as the Issuer may direct If less than all of the Bonds of a single maturity are to be redeemed, the Bonds to be redeemed will be selected by lot or other random method by the Registrar in such a manner as the Registrar may determine. Notice of Redemption. Prior to the redemption of any Bonds under the provisions of the Bond Resolution, the Bond Registrar shall give written notice not less than thirty (30) days prior to the redemption date to each registered owner thereof. Interest Interest on said Series 2012I Bonds will be payable on June 1, 2013 and semiannually on the 1st day of June and December thereafter. Interest shall be payable by check or draft of the Paying Agent mailed to the persons who were registered owners thereof as of the fifteenth day of the month immediately preceding the Interest Payment Date (the "Record Date "), to the addresses appearing on the registration books maintained by the Paying Agent or to such other address as is furnished to the Paying Agent in writing by a registered owner. Interest will be computed on the basis of a 360 -day year of twelve 30 -day months and will be rounded pursuant to rules of the Municipal Securities Rulemaking Board. Payment of and Security for the Bonds The Bonds are general obligations of the City and the unlimited taxing powers of the City are irrevocably pledged for their payment Upon issuance of the Bonds, the City will levy taxes for the years and in amounts sufficient to provide 100% of annual principal and interest due on all Bonds. If, however, the amount credited to the debt service fund for payment of the Bonds is insufficient to pay principal and interest, whether from transfers or from original levies, the City must use funds in its treasury and 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 deficiency. Future Financing The City anticipates additional borrowing needs within 90 days of the date of this Official Statement as follows: ➢ Series 2012E, $3,695,000 ➢ Series 2012H, $2,420,000 ➢ Series 2012F Taxable, $1,050,000 ➢ Series 2012G, Current Refunding, $950,000 BONDHOLDERS' RISKS Secondary Market There can be no guarantee that there will be a secondary market for the Bonds or, if a secondary market exists, that such Bonds can be sold for any particular price. Occasionally, because of general market conditions or because of adverse history of economic prospects connected with a particular issue, and secondary marketing practices in connection with a particular Bond or Bonds issue are suspended or terminated. Additionally, prices of bond or note issues for which a market is being made will depend upon then prevailing circumstances. Such prices could be substantially different from the original purchase price of the Bonds. Ratings Loss Moody's Investors Service, Inc. ("Moody's ") has assigned a rating of "_" to the Bonds. Generally, a rating agency bases its rating on the information and materials furnished to it and on investigations, studies and assumptions of its own. There is no assurance that the rating will continue for any given period of time, or that such rating will not be revised, suspended or withdrawn, if, in the judgment of Moody's, circumstances so warrant. A revision, suspension or withdrawal of a rating may have an adverse effect on the market price of the Bonds. Rating agencies are currently not regulated by any regulatory body. Future regulation of rating agencies could materially alter the methodology, rating levels, and types of ratings available, for example, and these changes, if ever, could materially affect the market value of the Bonds. Forward - Looking Statements This Official Statement contains statements relating to future results that are "forward - looking statements" as defined in the Private Securities Litigation Reform Act of 1995. When used in this Official Statement, the words "estimate," "forecast," "intend," "expect" and similar expressions identify forward - looking statements. Any forward - looking statement is subject to uncertainty. Accordingly, such statements are subject to risks that could cause actual results to differ, possibly materially, from those contemplated in such forward - looking statements. Inevitably, some assumptions used to develop forward - looking statements will not be realized or unanticipated events and circumstances may occur. Therefore, investors should be aware that there are likely to be differences between forward 4 looking statements and the actual results. These differences could be material and could impact the availability of funds of the Issuer to pay debt service when due on the Bonds. DTC- Beneficial Owners Beneficial Owners of the Bonds may experience some delay in the receipt of distributions of principal of and interest on the Bonds since such distributions will be forwarded by the Paying Agent to DTC and DTC will credit such distributions to the accounts of the Participants which will thereafter credit them to the accounts of the Beneficial Owner either directly or indirectly through indirect Participants. Neither the Issuer nor the Paying Agent will have any responsibility or obligation to assure that any such notice or payment is forwarded by DTC to any Participants or by any Participant to any Beneficial Owner. In addition, since transactions in the Bonds can be effected only through DTC Participants, indirect participants and certain banks, the ability of a Beneficial Owner to pledge the Bonds to persons or entities that do not participate in the DTC system, or otherwise to take actions in respect of such Bonds, may be limited due to lack of a physical certificate. Beneficial Owners will be permitted to exercise the rights of registered Owners only indirectly through DTC and the Participants. See "THE BONDS— Book -Entry Only System." Other Factors An investment in the Bonds involves an element of risk In order to identify risk factors and make an informed investment decision, potential investors should be thoroughly familiar with this entire Official Statement (including the Appendices hereto) in order to make a judgment as to whether the Bonds are an appropriate investment Pending Federal Tax Legislation From time to time, legislative proposals are pending in Congress that would, if enacted, alter or amend one or more of the federal tax matters described herein in certain respects or would adversely affect the market value of the Bonds. It cannot be predicted whether or in what forms any of such proposals, either pending or that may be introduced, may be enacted and there can be no assurance that such proposals will not apply to the Bonds. Debt Payment History The City knows of no instance in which it has defaulted in the payment of principal or interest on its debt Summary The foregoing is intended only as a summary of certain risk factors attendant to an investment in the Bonds. In order for potential investors to identify risk factors and make an informed investment decision, potential investors should become thoroughly familiar with this entire Official Statement and the Appendices hereto. LITIGATION The City is a defendant in an action brought in the Iowa District Court for Dubuque County (J. Thomas Zaber v. City of Dubuque), alleging that gas and electric franchise fees imposed by the City are illegal because they constitute unauthorized taxes. This case has been certified as a class action with two subclasses defined as follows: All persons or entities who paid a gas utility franchise fee imposed by the City of Dubuque any time after September 5, 2001; All persons or entities who paid an electric utility franchise fee imposed by the City of Dubuque any time after September 5, 2001. Plaintiffs seek a refund of all such franchise fees paid through the date of judgment, pre judgment interest from the time of the alleged wrongful collection of said franchise fees, post judgment interest allowed by law and attorney fees as allowed by law. The claim generally is based on a 2006 decision by the Iowa Supreme Court (Kragnes v. City of Des Moines, 714 N. W.2d 632 (Iowa 2006). In that case, the Iowa Supreme Court concluded that gas and electric franchise fees not reasonably related to the reasonable costs of inspecting, licensing, supervising or otherwise regulating the activity that is being franchised constitute a tax which has been assessed in violation of Iowa Code Section 364.3(4). On May 26, 2009 the Govemor signed Senate File 478 authorizing (prospectively) gas and electric franchise fees that do not exceed five percent of a franchisee's gross revenues, without regard to the city's costs of inspecting, supervising, and otherwise regulating the franchise. The City of Dubuque has ordinances in effect that impose gas and electric franchise fees of 2% on gross sales of natural gas and electricity within the City. On July 20, 2012, the Iowa District Court for Dubuque County granted the City's motion for partial summary judgment prohibiting recovery for any franchise fees charged after May 26, 2009, or before September 5, 2001 (recognizing a five year statute of limitation from the date of the original filing September 5, 2006). 5 That part of the Zaber lawsuit relating to gas and electric fees collected in the period between September 5, 2001 and May 26, 2009, remains pending. Litigation was stayed pending a second decision in the Kragnes case regarding what expenses a city could legally recover through a franchise fee without creating a tax. City expenses which can be legally recovered from franchise fees are not subject to refund On March 2, 2012, the Iowa Supreme Court issued its decision in the second Kragnes appeal. As a result, the stay in this litigation has been lifted and a trial is scheduled to commence October 21, 2013. The City believes that most or all of its costs are proper and that either no refund or a refund substantially smaller than originally projected is likely. City staff would recommend use of current franchise fee revenue as a source for any refunds. The City is a party to an arbitration proceeding before a panel of three arbitrators of the American Arbitration Association. The dispute arises from a release of elemental mercury by subcontractors of Miron Construction, Inc. on September 23, 2010, in the course of reconstruction of the Dubuque Water Pollution Control Plant. The mercury spill has been remediated. The City and Miron vigorously dispute liability for the costs of remediation. Miron is seeking $677,847.71 together with attomey's fees, costs and punitive damages from the City. The City denies liability to Miron and is seeking from Miron $2,194,882.20 together with attomey's fees and as reimbursement for its costs. City staff believes the City has substantial defenses and is entitled to reimbursement The arbitration hearing is scheduled to commence February 18, 2013. The City is a party to an arbitration proceeding initiated by Tschiggfrie Excavating Co. which arises from the Bee Branch Creek Restoration Project, a $57.5 M excavation and construction project Tschiggfrie claims extra work in an amount in excess of $3M The City vigorously disputes liability for the extra work. City staff believes the City has substantial defenses to the claims. The arbitration hearing has been continued to December 2012. The City is not aware of any other threatened or pending litigation affecting the validity of the Bonds or the City's ability to meet its financial obligations. ACCOUNTANT The accrual -basis financial statements of the Issuer included as APPENDIX D to this Official Statement have been examined by Eide Bailly, to the extent and for the periods indicated in their report thereon Such financial statements have been included herein without permission of said CPA, and said CPA expresses no opinion with respect to the Bonds or the Official Statement. UNDERWRITING The Bonds are being purchased, subject to certain conditions, by (the "Underwriter "). The Underwriter has agreed, subject to certain conditions, to purchase all, but not less than all, of the Bonds at an aggregate purchase price of $ plus accrued interest to the Closing Date. The Underwriter may offer and sell the Bonds to certain dealers (including dealers depositing the Bonds into unit investment trusts, certain of which may be sponsored or managed by the Underwriter) at prices lower than the initial public offering prices stated on the cover page. The initial public offering prices of the Bonds may be changed, from time to time, by the Underwriter. The Underwriter intends to engage in secondary market trading of the Bonds subject to applicable securities laws. The Underwriter is not obligated, however, to repurchase any of the Bonds at the request of the holder thereof. THE PROJECT Proceeds of the Bonds will be used to defease the City's General Obligation Bonds, Series 2005C, dated April 1, 2005, General Obligation Bonds, Series 2006B and Series 2006C, dated May 2, 2006 and General Obligation Bonds, Series 2007B, dated December 1, 2007 as well as to provide for costs of issuance associated with the Bonds. 6 SOURCES AND USES OF FUNDS Sources of Funds Bond Proceeds Reoffering Premium Total Sources of Funds Uses of Funds Deposit to Escrow fund Costs of Issuance Underwriter's Fee $7,254,454.02 28,600.00 58,720.00 Total Uses of Funds $ Preliminary, subject to change TAX MATTERS Taxability of Interest In the opinion of bond counsel, under existing law the interest on the Bonds is included in gross income for federal income tax purposes 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. 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. 7 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 Payments of interest on, and proceeds of the sale, redemption or maturity, 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 retums. The reporting and backup withholding requirements do not affect the excludability of such interest from gross income for federal tax purposes. Opinions The Bonds are subject to approval as to certain matters by Ahlers & Cooney, P.C. of Des Moines, Iowa s Bond Counsel. 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. 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. FINANCIAL ADVISOR The Issuer has retained Piper Jaffray & Co. as financial advisor (the "Financial Advisor") in connection with the issuance of the Bonds. The Financial Advisor has not been engaged, nor has it undertaken, to independently verify the accuracy of the Official Statement The Financial Advisor is not a public accounting firm and has not been engaged by the Issuer to compile, review, examine or audit any information in the Official Statement in accordance with accounting standards.. C ONTINUING DISC LOSURE In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph (b)(5) of Rule 15c2 -12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Rule "), the Issuer will covenant and agree, for the benefit of the registered holders or beneficial owners from time to time of the outstanding Bonds, in the Bond Resolution, to provide reports of specified information and notice of the occurrence of certain events, if material, as hereinafter described (the "Disclosure Covenants "). The information to be provided on an annual basis, and the events as to which notice is to be given, if material, is summarized below under the caption "APPENDIX C - Form of Continuing Disclosure Certificate" herein for more information The City inadvertently failed to comply with previous continuing disclosure undertakings in accordance with the reporting requirements of paragraph (f) (3) of the Rule. While some of the required tables were provided in accordance to the Rule (within 210 days after the end of the fiscal year), all required tables and the audited financial statements for the years ending June 30, 2009 and June 30, 2011 were not timely filed On February 1, 2010, all outstanding required tables and the audited financial statements for the year ending June 30, 2009 were filed; and on January 31, 2012, the City filed the outstanding required tables and audited financial statements for the year ending June 30, 2011, in accordance with the Rule and is now compliant The City has taken steps to assure future compliance with it Disclosure Covenants. The Issuer has not materially failed to comply with the Rule. Breach of the Disclosure Covenants will not constitute a default or an "Event of Default" under the Bonds or the resolution for the Bonds. A broker or dealer is to consider a known breach of the Disclosure Covenants, however, before recommending the purchase or sale of the Bonds in the secondary market. Thus, a failure on the part of the City to observe the Disclosure Covenants may adversely affect the transferability and liquidity of the Bonds and their market price. 8 Certification The City has authorized the distribution of this Official Statement for use in connection with the initial sale of the Bonds. I have reviewed the information contained within the Official Statement of Dubuque, Iowa and said Official Statement does not contain any material misstatements of fact nor omissions of any material fact regarding the issue of $7,340,000* Taxable General Obligation Refunding Bonds, Series 2012I of said Issuer to be issued under date of Date of Delivery. Preliminary, subject to change 9 DUBUQUE, IOWA /s/ Jenny Larson Budget Director APPENDIX A - INFORMATION ABOUT THE ISSUER CITY OF DUBUQUE, IOWA CITY OFFICIALS MAYOR COUNCIL MEMBERS: Roy Buol Ric Jones David Resnick Kevin Lynch Karla Braig Joyce Conners Lynn Sutton ADMINISTRATION CITY MANAGER: Michael Van Milligen ASSISTANT CITY MANAGER: Cindy Steinhauser ASSISTANT CITY MANAGER: Teri Goodman FINANCE DIRECTOR: Ken Tekippe BUDGET DIRECTOR: Jenny Larson CITY CLERK Kevin Fimstahl CITY ATTORNEY Barry A. Lindahl Dubuque, Iowa CONSULTANTS BOND COUNSEL: Ahlers & Cooney PC Des Moines, Iowa FINANCIAL ADVISOR: Piper Jaffray & Co. Des Moines, Iowa REGISTRAR & PAYING AGENT: Wells Fargo Bank Des Moines, Iowa A -1 General Information The City of Dubuque is located in north east Iowa and serves as the county seat for Dubuque County. The City, with a 2010 Census population of 57,637, has a land area of 31.8 square miles. Annexation activity in recent years has been voluntary with over 760 acres annexed in the past five years. The City lies at the intersection of Highways 61/151 and 20. The City is located approximately 22 miles southwest of Platteville, Wisconsin; 92 miles southwest of Madison, Wisconsin; 84 miles northeast of Iowa City, Iowa; 65 miles north of the Quad Cities (Rock Island and Moline, Illinois and Bettendorf and Davenport, Iowa); 175 miles west of Chicago, Illinois and 185 miles northeast of Des Moines. Dubuque Regional Airport provides jet service to Chicago via American Airlines. Railroad service to the City is provided by the Canadian National and Canadian Pacific, as well as bus service being provided by Greyhound. City Government The City operates under a Council- Manager -Ward form of govemment. Policy is established by a Mayor and six council members, the mayor and two of the council members being elected at large and four members elected from Wards. City Council members hold four year staggered terms. The City Manager, City Attorney and City Clerk are appointed by the City Council. Education Public education to the City is provided by the Dubuque Community School District, with certified enrollment for the 2011 -2012 school year of 10,469. The District employs 1,735 full and part-time employees. The Dubuque School District has two high schools, an alternative high school, three middle schools and thirteen elementary schools. The Archdiocese of Dubuque operates four Catholic elementary facilities, one middle school and one high school within the City. Higher education opportunities within driving distance include Loras College, Clarke University & University of Dubuque, Dubuque, and Northeast Iowa Community College, with local facilities in downtown Dubuque and Peosta (15 minutes west of Dubuque on Highway 20). Utilities The following utilities operate within the Issuer providing the services indicated: Electric Power: Natural Gas: Telephone: Water: Sanitary Sewer: Stormwater: Refuse: Employees and Employee Pension Plan Alliant Utilities Black Hills Century Link City of Dubuque City of Dubuque City of Dubuque City of Dubuque The City has 537 full and 143 permanent part-time employees and 295 seasonal employees, including a police force of 105 sworn personnel and a fire department of 81 fire fighters. Of the City's 975 employees, 546 are currently enrolled in the Iowa Public Employees Retirement System ( IPERS). Iowa Public Employees' Retirement System is a state -wide multiple- employer cost- sharing defined benefit pension plan administered by the State of Iowa. IPERS provides retirement and death benefits which are established by State statute to plan members and beneficiaries. All full -tune employees of the Issuer are required to participate in IPERS. Employees who retire at age 65 (or any time after age 58 with 30 or more years of service) are entitled to full monthly benefits. IPERS offers five options for distribution of retirement benefits. Benefits become fully vested after completing four years of service or after attaining age 55. IPERS plan members are required to contribute a percentage of their annual salary, which amounted to 4.1% in fiscal year 2009, 4.3% in fiscal year 2010, 4.5% in fiscal year 2011, 5.38% in fiscal year 2012 and 5.78% in fiscal year 2013. The Issuer is also required to make annual contributions to IPERS equal to amounts required by State statute. The Issuer's share, payable from the applicable funds of the Issuer, is provided by an annual levy of taxes without limit or restriction as to rate or amount against all the taxable property of the Issuer. All contributions are on a current basis. See "APPENDIX B— AUDITED FINANCIAL STATEMENTS" for additional information on IPERS. The following table sets forth the statutorily required contributions made by the Issuer to IPERS for Fiscal Years 2009 through, and including, 2012. The Issuer has always made their full statutorily required contributions to IPERS. The Issuer cannot predict the levels of funding that will be required in the future. Fiscal Year 2009 2010 2011 Amount Contributed $1,314,106 1,456,384 1,641,811 A -2 % of Covered Payroll 10.45% 10.95 11.45 2012 1,964,764 13.45 Source: City of Dubuque Independent Auditor's Reports for Fiscal Year Ending June 30, 2011 and unaudited for June 30, 2012 The fund is administered by the State with administration costs paid from income derived from invested funds. IPERS has an unfunded actuarial liability and unrecognized actuarial loss. The following table sets forth certain information about the funding status of IPERS that has been extracted from the comprehensive annual financial report of IPERS for fiscal year 2010 (the ` IPERS CAFR "). A complete copy of the IPERS CAFR can be obtained by visiting IPERS website at: httplAvww.ipers.org/ publications /misc /pdf/financial/cafr/cafr.pdf or by writing to IPERS at P.O. Box 9117, Des Moines, Iowa 50306 -9117. According to IPERS, as of the end of fiscal year 2010, there were approximately 324,873 total members participating in IPERS, including Issuer employees. IPERS does not break out the funding status for each participating entity, therefore, it is not possible to determine the Issuer's allocable share of the funding status of IPERS. Fiscal Year Ended June 30 2006 2007 2008 2009 2010 2011 Actuarial Value of Assets [a] $19,144,036,519 20,759,628,415 21,857,423,183 21,123,979,941 21,537,458,560 22,575,309,199 Actuarial Accrued Liability [b] $21,651,122,419 23,026,113,782 24,522,216,589 26,018,593,823 26,468,419,650 28,257,080,114 Unfunded Actuarial Accrued Liability (Actuarial Value) [b] -[a] $2,507,085,900 2,266,485,367 2,664,793,406 4,894,613,882 4,930,961,090 5,681,770,915 Source: IPERS Comprehensive Annual Financial Report (Fiscal Year 2011) Funded Ratio (Actuarial Value) [a]/[b] 88.42% 90.16 89.13 81.19 81.37 79.89 Covered Payroll [c] $5,523,863,321 5,781,706,199 6,131,445,367 6,438,643,124 6,571,182,005 6,574,872,719 UAAL as a Percentage of Covered Payroll (Actuarial Value) [[b- a]/[c]] 45.39% 39.20 43.46 76.02 75.04 86.42 When calculating the funding status of IPERS for fiscal year 2011, the following assumptions were used: (1) the amortization period for the total unfunded actuarial liability is 30 years (which is consistent with the maximum acceptable amortization period set forth by the Govemmental Accounting Standards Board ("GASB ") in GASB Statement No. 25); (2) the rate of return on investments is assumed to be 7.5 %; (3) salaries are projected to increase 4.0 -17% for IPERS, depending on years of service; and (4) the rate of inflation is assumed to be 3.25% for prices and 4.0% for wages. Bond Counsel, the Issuer and the Financial Advisor undertake no responsibility for and make no representations as to the accuracy or completeness of the information available from the IPERS discussed above or included on the IPERS website, including, but not limited to, updates of such information on the State Auditor's website or links to other Internet sites accessed through the IPERS website. Defined Benefit Pension Plan - Municipal Fire and Police Retirement System of Iowa The Municipal Fire and Police Retirement System of Iowa ( MFPRSI), created under Chapter 411.35 of the Code of Iowa, is the administrator of a multiple- employer, cost sharing, defined benefit pension plan for the exclusive benefit of eligible employees of participating cities (substantially all full -time employees of the respective fire and police departments). It is governed by a nine- member board of trustees who are elected by the employers and participants of MFPRS. The City's responsibility is limited to payment of contributions. MFPRSI provides retirement disability and death benefits that are established by state statue to plan members and beneficiaries. Plan members are required to contribute 9.40% of their eamable compensation and the City's contribution rate is 26.12% of eamable compensation. The City is current in its obligation with MFPRSI, their contributions to MFPRSI for the last three years have been: $3,177,158 in FY 2011/12, $2,404,474 in FY 2010 /11 and $1,966,345 in FY 2009/10. GASB 45 In June 2004, the Govemmental Accounting Standards Board ( "GASB ") issued GASB 45, which address how state and local govemments are required to account for and report their costs and obligations related to other post-employment 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 govenuuents 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. In accordance with the requirements of GASB 45, the Issuer's financial statements must comply with these provisions no later than the fiscal year ending June 30, 2010. Plan Description - The City operates a single- employer benefit plan which provides post - employment benefits for eligible participants enrolled in the City - sponsored plans, which include the employees of the Dubuque Metropolitan Area Solid Waste Agency (a component unit). The plan does not issue a stand -alone financial report The benefits are provided in the form of an implicit rate subsidy where pre -65 retirees receive health insurance coverage by paying a combined retiree /active rate for the self - insured medical and prescription drug plan An explicit rate subsidy where the City pays the full cost of a $1,000 policy in the fully- insured life insurance plan. A -3 To be eligible for the health insurance coverage, retirees must be at least 55 years old, have completed 4 years of service, and be vested with either the Iowa Public Employee's Retirement System (IPERS) or the Municipal Fire and Police Retirement System of Iowa (IvIFPRSI). In addition to the health eligibility coverage requirements, one must have belonged to a bargaining group to be eligible for life insurance benefits. There are approximately 523 active and 25 retired members in the plan. Funding Policy — The contribution requirements of plan members are established and may be amended by the City. The City currently finances the retiree benefit plan on a pay -as- you -go basis. Annual OPEB Cost and Net OPEB Obligation — The City's annual OPEB costs is calculated based on the annual required contribution (ARC) of the City, an amount actuarially determined in accordance with GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period not to exceed 30 years. The following table shows the components of the City's annual OPEB cost for the year ended June 30, 2012, the amount actually contributed to the plan, and changes in the City's net OPEB obligation: Annual required contribution Interest on net OPEB obligation Adjustment to annual required contribution Annual OPEB cost Contributions made, net of retiree contributions Increase in net OPEB obligation Net OPEB obligation, beginning of year Net OPEB obligation, end of year $570,443 118,808 (105,247) 584,004 (201,201) 382,803 2,376,162 $2,758,965 For calculation of the net OPEB obligation, the actuary has set the transition day as July 1, 2008. The end of year net OPEB obligation was calculated by the actuary as the cumulative difference between the actuarially determined funding requirements and the actual contributions for the year ended June 30, 2012. For the year ended June 30, 2012, the City paid $549,234, for retiree claims. Plan members eligible for benefits contributed $301,848 or 100% of the premium costs. The net resulted in City contributions of $201,201. The City's annual OPEB cost, the percentage of annual OPEB costs contributed to the plan and the net OPEB obligation as of June 30, 2012 are summarized as follows: Year Ended Annual OPEB Cost % of Annual OPEB Costs Contibted Net OPEB Obligation June 30, 2009 $945,000 2.6% $920,157 June 30, 2010 945,000 (8.3) 1,943,740 June 30, 2011 581,536 25.6 2,376,162 June 30, 2012 584,004 34.45 2.758,965 Funded Status and Funding Progress — As of July 1, 2010, the most recent actuarial valuation date for the period July 1, 2010 through June 30, 2011, the actuarial accrued liability was $5,481,802, with no actuarial value of assets, resulting in an unfunded actuarial accrued liability (UAAL) of $5,481,802. The covered payroll (annual payroll of active employees covered by the plan) was approximately $29,790,517 and the ratio of the UAAL to covered payroll was 18.40 %. As of June 30, 2011, there were no trust fund assets. Union Contracts City employees are represented by the following bargaining units: Insurance The City's insurance coverage Bargaining Unit Teamsters Local Union No 421 Teamsters Local Union No 421 Bus Operators Dubuque Professional Firefighters Association Dubuque Police Protective Association International Union of Operating Engineers s as follows: Type of Insurance A -4 Contract Expiration Date June 30, 2014 June 30, 2014 June 30, 2014 June 30, 2014 June 30, 2014 Limits General Liability Automobile Liability Public Officials Police Professional Liability Boiler & Machinery Property Blanket Employees Crime Policy Airport Commission Airport Liability Population The following table sets forth population trends for the Issuer: Year Population 2010 57,637 2000 57,686 1990 57,538 1980 62,374 1970 62,309 $12,000,000 12,000,000 12,000,000 12,000,000 25,000,000 356,095,000 1,000,000 5,000,000 20,000,000 Source: U.S. Census Bureau website. Population by Age Presented below is the 2010 Census figures according to age group for the County of Dubuque and the State of Iowa: Age Group Under 19 years of age 20 to 24 years of age 25 to 44 years of age 45 to 64 years of age 65 to 84 years of age 85 and over Median Age Source: U.S. Census Bureau website. Major Employers Dubuque County 27.1% 7.2 23.5 26.8 12.9 2.5 38.6 State of Iowa 26.9% 7.0 24.5 26.7 12.4 2.3 38.1 Following are the major employers within the City and the current number of people they employ: Employer John Deere Dubuque Works Dubuque Community School District Hy -Vee Mercy Medical Center IBM Medical Associates Clinic The Finley Hospital City of Dubuque Eagle Window & Door Holy Family Catholic Schools Prudential Retirement Diamond Jo Casino Dubuque County Heartland Financial Dubuque Racing Association Loras College McKesson Flexsteel Industries, Inc. Dubuque Bank & Trust A.Y. McDonald Mfg. Co. Cottingham & Butler Inc Business Backhoe, loaders, crawlers, skid steer loaders & winches Education Grocery store Health care Global technology sery ices Health care Health care City govemment Aluminum clad & all wood window Private school Pension planning recording keeping & administration Riverboat casino County govemment Bank holding company Entertainment Education Data processing sery ices Manufacturing Banking Manufacturing Insurance A -5 Approximate Employees 2,520 1,946 1,3501 1,324 1,300 999 920 686 625 575 550 550 450 450 4132 412 400 380 365 360 360 Woodward Communications, Inc. Daily & weekly newspapers and specialty publications 350 QuadGraphics Printing services 345 Hartig Drug Retail Drug Stores 328 University of Dubuque Education 327 Sedgwick Claims/Benefits Management and Processing 315 Medlin Health care equipment 300 ' Includes full -time and part-tune employees 2 D.B.A. Mystique Casino Source: Greater Dubuque Development Corporation, phone interviews, and the City, September 2011. Employment Statistics The State of Iowa Department of Job Service reports unemployment unadjusted rates as follows (August 2012) Governmental Body National Average State of Iowa Dubuque County Historical Employment Statistics Percentage Unemployed 8.1% Presented below are the historical unemployment rates for the years indicated for County and the State of Iowa. Calendar Year Dubuque County State Of Iowa 2011 5.50% 5.90% 2010 6.70 6.70 2009 6.10 6.00 2008 4.20 4.10 2007 4.10 3.80 Source: Iowa Workforce Development Center website. Retail Sales Presented below are retail sales statistics for the City of for the period indicated: Year Ended Taxable Retail Sales Number of Businesses 2011* $1,014,284,468 2009 2010* 971,050,048 2043 2009* 961,287,890 2026 2008 ** 988,428,418 1925 2007 ** 970,039,446 1893 * reported as of June 30 **reported as of March 31 Median Family Income Dubuque County had a 2000 median family income of $39,582 compared to $39,469 for the State of Iowa. The following table represents the distribution of family incomes for the County at the time of the 2000 census: Household Income # of Households % of Households Under$10,000 2394 7.1 10,000 to 14,999 2000 5.9 15,000 to 24,999 5051 15.0 25,000 to 34,999 5035 14.9 35,000 to 49,999 6729 20.0 50,000 to 74,999 7301 21.7 75,000 to 99,999 2762 8.2 100,000 to 149,999 1505 4.5 150,000 to 199,999 343 1.0 200,000 or more 583 1.7 A -6 Effective Buying Income The private publication "Sales & Marketing Management" has developed a wealth indicator termed "effective buying income" (EBI) defined as personal income less personal tax and non -tax payments, which is considered by the publication to be a bulk measurement of market potential. Presented below is the EBI for Dubuque County and the State of Iowa for the periods indicated: 2009 County 2009 State Retail Sales (000) $1,429,770 $40,982,154 Total EBI (000) 1,756,855 57,558,473 Median Household EBI 38,201 38,919 % of Households by EBI $10,000 to $19,999 19.0% 19.9% $20,000 to $34,999 25.8 24.2 $35,000 to $49,999 21.4 20.5 $50,000 and over 33.8 35.4 Financial Services Financial services for residents of the City are provided by American Trust & Savings Bank, Dubuque Bank and Trust Company, East Dubuque Savings Bank, Fidelity Bank & Trust and Premier Bank; by branch offices of State Central Bank and U.S. Bank N.A.; as well as by several credit unions. American Trust & Savings Bank, Dubuque Bank and Trust Company, East Dubuque Savings Bank, Fidelity Bank & Trust and Premier Bank report the following deposits as of December 314 for each year: American Trust & Dubuque Bank and East Dubuque Year Savings Bank Trust Company Savings Bank Fidelity Bank & Trust Premier Bank 2007 $655,032,000 $670,219,000 $169,022,000 $360,818,000' $166,891,000 2008 708,594,000 749,192,000 162,683,000 247,857,000 186,858,000 2009 711,573,000 864,067,000 171,170,000 321,864,000 213,076,000 2010 660,263,000 809,181,000 148,089,000 370,553,000 196,664,000 2011 716,702,000 938,000,000 132,568,000 452,776,000 200,907,000 ' Fidelity Bank and Trust relocated its headquarters from the City of Dyersville, Iowa to the City of Dubuque in 2009. December 31, 2007 deposits are for all locations including the branch office located within the City. Source: FDIC Institution Directory website. Building Permits City officials report the following construction activity as of August 31, 2012. Building permits are reported on a fiscal year basis. Fiscal Year Single Family Multi- Family Commercial/Industrial Total Permits Total Valuation 2008 -09 39 7 19 1,740 $ 81,460,036 2009 -10 79 22 12 1,515 77,302,482 2010 -11 88 7 15 3,020 134,246,328 2011 -12 97 8 14 4,183 224,053,472 2012 -13 20 3 2 464 16,898,273 Totals include single family, multi- family, commercial/industrial, remodeling, roofing, siding, decks, additions and other miscellaneous residential and commercial permits. CITY PROPERTY VALUES Iowa Property Valuations 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 2011 final values, called Actual Valuation, are then adjusted by the county auditor. Assessed or Taxable Valuation subject to tax levy is then determined by the application of State determined rollback percentages, principally to residential and commercial property. The Legislature's intent has been to limit the growth of statewide taxable valuations for the specific classes of property to 4% annually. Political subdivisions whose taxable values are thus reduced or are unusually low in growth are allowed to appeal the valuations to the State Appeal Board, in order to continue to fund present services. A -7 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 Assessed or Taxable Valuation The rollback percentages for residential, agricultural and commercial valuations are as follows: Fiscal Year 2012 -13 2011 -12 2010 -11 2009 -10 2008 -09 Residential Rollback 50.7518 48.5299 46.9094 45.5893 44.0803 Ag. Land & Buildings 57.5411 69.0152 66.2715 93.8568 90.1023 Commercial 100.0000 100.0000 100.0000 100.0000 99.7312 Property is assessed on a calendar year basis. The assessments finalized as of January 1 of each year are applied to the following fiscal year. For example, the assessments finalized on January 1, 2011 are used to calculate tax liability for the tax year starting July 1, 2012 through June 30, 2012. Presented below are the property valuations of the Issuer by class of property. 1112011 Valuations (Taxes payable July 1, 2012 to June 30, 2013) Residential Commercial Industrial Railroads Other Utilities w/o Gas & Electric Gross valuation Less military exemption Net Valuation TIF increment (used to compute debt service levies and constitutional debt limit) Taxed separately Ag. Land & Buildings Gas & Electric Utilities 100% Actual Value $2,306,638,673 791,784,906 70,792$)5 2,368,221 705,130 10,419,285 $3,182,708,820 (6,185,680) $3,176,523,140 $299,591,318 (0( 2) $4,753,159 'O $152,482,060 ( r) TIF increment valuation is reduced by $1,852 of military exemption. (2) Excludes $112,829 of TIF Increment Ag. Land & Buildings valuation. (a) Ag. Land & Buildings valuation is reduced by $1,852 of military exemption. 2011 Gross Taxable Valuation by Class of Property Residential Gas & Electric Utilities Commercial, Industrial, Utility and Other Railroads Total Gross Taxable Valuation 1) (1) Excludes Taxable TIF Increment and Ag Land & Buildings Trend of Valuations Assessment Year 2011 2010 2009 2008 2007 Payable Fiscal Year 2012 -13 2011 -12 2010 -11 2009 -10 2008 -09 100% Actual Valuation 3,633,462,506 3,553,386,961 3,486,704,735 3,344,904,153 3,272,443,439 Taxable Value (With Rollback) $1,169,198,342 791,784,906 70,792,605 2,368,221 705,130 10 419,285 $2,045,268,489 (6,184,133)1) $2,039,084,356 Gross Taxable Valuation $1,169,198,342 69,676,447 873,701,926 2,368,221 $2,114,944,936 $299,591,318 fn(2) $2,686,324 ) $69,676,447 Percent Total 55.28% 3.30% 41.31% 0.11% 100% Net Taxable Valuation (With Rollback) 2,108,760,803 2,034,470,780 1,980,445,335 1,935,666,751 1,878,770,648 Taxable TIF Increment 299,591,318 279,611,679 249,501,324 174,885,331 148,458,171 The 100% Actual Valuations, before rollback and after the reduction of military exemption, include Ag. Land, Ag. Buildings, TIF Increment and Gas & Electric Utilities. The Taxable Valuations, with the rollback and after the reduction of military exemption include Gas & Electric A -8 Utilities and exclude Ag. Land, Ag. Buildings and Taxable TIE Increment Iowa cities certify operating levies against Taxable Valuation excluding Taxable TIE Increment and debt service levies are certified against Taxable Valuation including the Taxable TIE Increment Tax Rates The Issuer levied the following taxes for collection during the fiscal years indicated: (Source: Local Division, Iowa State Comptroller, Office) Employee Total Fiscal Year General Outside Emergency Debt Benefits Transit Levy 2013 8.10000 0.13%5 0.00000 0.02729 2.02267 0.49516 10.78477 2012 8.10000 0.54781 0.00000 0.05278 1.75052 0.00000 10.45111 2011 8.10000 0.75000 0.00000 0.05300 1.12441 0.00000 10.02741 2010 8.10000 0.81492 0.00000 0.03702 0.90583 0.00000 9.85777 2009 8.10000 0.75412 0.00000 0.00000 1.11492 0.00000 9.96904 Combined Historic Tax Rates The Issuer levied the following taxes for collection during the fiscal years indicated: (Source: Local Division, Iowa State Comptroller, Office) Fiscal Year City School College State Assessor Ag Extens Hospital County Total Levy Rate 2013 10.78477 15.40388 0.98207 0.00330 0.44840 0.08174 0.26%1 6.43124 34.40501 2012 10.45111 16.87685 1.07379 0.00300 0.33842 0.07564 0.26040 6.49167 35.57088 2011 10.02741 16.88349 1.03532 0.00300 0.25772 0.03219 0.26409 6.50193 35.00515 2010 9.85777 16.87918 0.99471 0.00300 0.28030 0.03298 0.26342 6.40435 34.71571 2009 9.%904 16.88112 0.55714 0.00350 0.32436 0.03572 0.26744 6.40844 34.44676 Levy Limits A city's general fund tax levy is limited to $8.10 per $1,000 of taxable value, with provision for an additional $0.27 per $1,000 levy for an emergency fund which can be used for general fund purposes (Code of Iowa, Chapter 384, Division I). Cities may exceed the $8.10 limitation upon authorization by a special levy election. Further, there are limited special purpose levies which may be certified outside of the above described levy limits (Code of Iowa, Section 384.12). The amount of the City general find levy subject to the $8.10 limitation is $8.10 for FY 2012 -13. The City does levy costs for tort liability and other insurance expense, for the operation and maintenance of publicly owned transit, and for employee benefits in addition to the $8.10 general fund limit as authorized by law. Currently, the City does not levy an emergency levy. Debt service levies are not limited Tax Collection History Fiscal Amount Amount Percentage Year Levied Collected (1) Collected (1) 2013 $22,758,753 In Collection In Collection 2012 21,284,751 $21,307,270 100.00% 2011 19,878,962 19,755,236 99.38 2010 19,095,444 19,088,379 99.96 2009 18,736,759 18,667,933 99.63 2008 18,211,000 18,127,137 99.54 (1) Collections for fiscal year 2012 are unaudited Largest Taxpayers Set forth in the following table are the persons or entities which represent the 2013 largest taxpayers within the Issuer, as provided by the Dubuque County Assessor's Office. No independent investigation has been made of and no representation is made herein as to the financial condition of any of the taxpayers listed below or that such taxpayers will continue to maintain their status as major taxpayers in the City. The City's mill levy is uniformly applicable to all of the properties included in the table, and thus taxes expected to be received by the City from such taxpayers will be in proportion to the assessed valuations of the properties. The total tax bill for each of the properties is dependent upon the mill levies of the other taxing entities which overlap the properties. Taxpayer Type of Property/Business 1 /1 /11 Taxable Valuation Alliant Interstate Energy Power Co. Utility $99,015,284 Peninsula Gaming Company LLC Commercial 56,784,250 Black Hills Energy Corp. Utility 47,166,449 A -9 Kennedy Mall Inc. Progressive Processing LLC Medical Associates Realty LP Nordstrom Inc. The McGraw Hill Companies Inc. Otto A LLC Walter Development LLC Net Valuation Legislation Commercial Industrial Commercial Commercial Commercial Industrial Commercial $3,176,523,140 27,206,390 21,397,890 19,559,060 17,221,570 14,729,210 14,100,000 13 781 290 $2,039,084,356 From time to time, legislative proposals are pending in Congress and the Iowa General Assembly that would, if enacted, alter or amend one or more of the property tax matters described herein It cannot be predicted whether or n what forms any of such proposals, either pending or that may be introduced, may be enacted, and there can be no assurance that such proposals will not apply to valuation, assessment or levy procedures for taxes levied by the City or have an adverse impact on the future tax collections of the City. Purchasers of the Bonds should consult their tax advisors regarding any pending or proposed federal or state tax legislation. The opinion expressed by Bond Counsel is based upon existing legislation as of the date of issuance and delivery of the Bonds and Bond Counsel has expressed no opinion as of any date subsequent thereto or with respect to any pending federal or state tax legislation. Iowa Code section 76.2 provides that when an Iowa political subdivision issues general obligation debt: "The governing authority of these political subdivisions before issuing bonds shall, by resolution, provide for the assessment of an annual levy upon all the taxable property in the political subdivision sufficient to pay the interest and principal of the bonds within a period named not exceeding the applicable period of time specified in section 76.1. A certified copy of this resolution shall be filed with the county auditor or the auditors of the counties in which the political subdivision is located; and the filing shall make it a duty of the auditors to enter annually this levy for collection form the taxable property within the boundaries of the political subdivision until funds are realized to pay the bonds in full." Iowa Code section 76.1 provides that the annual levy shall be sufficient to pay the interest and approximately such portion of the principal of the bonds as will retire them in a period not exceeding twenty years from the date of issue, except for certain bonds issued for disaster purposes and bonds issued to refund or refinance bonds issued for such disaster purposes which may mature and be retired in a period not exceeding thirty years from date of issue. Public Funds Investments Funds on Hand (Cash and Investments as of August31, 2012) Agency Capital Component Unit Debt Service Enterprise General Intemal Service Permanent Special Total Cash and Investments CITY INDEBTEDNESS Debt Limit $1,537,956 26,617,333 10,039,915 220,571 21,469,761 8,057,856 2,838,507 61,445 7,902,497 $78,745,841 Article X[, Section 3 of the State of Iowa Constitution limits the amount of debt outstanding at any time of any county, municipality or other political subdivision to no more than 5% of the Actual Value of all taxable property within the corporate limits, as taken from the last state and county tax list The debt limit for the City, based on its 2011 actual valuation currently applicable to the fiscal year 2012 -13, is as follows: 2011 Actual Valuation of Property Less: Military Exemption Net Actual Valuation of Property Legal Debt Limit of 5% Legal Debt Limit Less: G.O. Debt Subject to Debt Limit Less: Urban Renewal Revenue Debt Subject to the Debt Limit Less: TIE Rebate Agreements Subject to the Debt Limit Less: Other Debt Subject to the Debt Limit Net Debt Limit A -10 $3,639,539,061 (6,185,985) $3,633,353,076 .05 $181,667,654 (95,460,000) (24,103,235) (25,144,361) (4,880,036) 1) $32,215,022 1) Includes loan agreement with Iowa DOT, Iowa Finance Authority Loan, general fund leases and water line loan. Upon completion of the sale of the City's general obligation Bonds Series 2012E, 2012F, 2012G, 2012H and 2012I, the City will have outstanding 26 separate general obligation issues, with scheduled principal and interest as shown below: Fiscal Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Total Principal 4,310,000 6,070,000 6,550,000 6,705,000 6,905,000 6,785,000 6,265,000 6,510,000 5,905,000 4,470,000 4,440,000 4,080,000 4,080,000 4,020,000 4,015,000 4,015,000 3,870,000 2,985,000 2,365,000 1,115,000 Total Interest 3,044,140 3,138,114 2,934,690 2,760,655 2,563,159 2,341,161 2,122,501 1,922,004 1,705,299 1,494,533 1,337,046 1,177,181 1,029,628 878,399 725,231 565,620 401,756 241,166 129,416 44,170 Total P &I 7,354,140 9,208,114 9,484,690 9,465,655 9,468,159 9,126,161 8,387,501 8,432,004 7,610,299 5,964,533 5,777,046 5,257,181 5,109,628 4,898,399 4,740,231 4,580,620 4,271,756 3,226,166 2,494,416 1,159,170 95,460,000 30,555,869 126,015,869 General Obligation Debt Subject to Abatement The Issuer has previously issued general obligation securities that it intends to abate from alternate revenues. Presented below is the schedule of principal and interest, presented by fiscal year and abatement source for general obligation securities outstanding: Year Water Sewer Refuse 2013 362,135 357,552 7,662 2014 484,161 461,718 7,604 2015 484,050 460,169 7,608 2016 490,046 459,383 7,640 2017 495,532 452,050 7,557 2018 285,830 320,509 7,587 2019 287,032 318,407 7,669 2020 285,391 322,204 7,678 2021 288,591 320,556 7,673 2022 290,295 323,696 7,757 2023 287,895 321,505 7,741 2024 290,325 325,238 7,809 2025 288,648 323,415 7,799 2026 290,463 326,167 7,870 2027 287,789 324,350 7,918 2028 290,823 327,931 7,929 2029 293,303 325,742 7,957 2030 293,844 326,854 7,940 2031 291,205 258,314 2,737 2032 176,284 161,588 0 Storm 1,329,914 1,361,465 1,363,004 1,359,972 1,362,553 1,361,943 1,364,614 1,365,237 1,358,635 1,367,389 1,366,550 1,215,811 1,079,564 854,001 855,906 855,192 549,475 464,697 341,842 40,828 LOST 272,228 465,887 461,250 462,171 463,067 464,649 458,561 456,434 458,742 458,802 439,694 426,246 422,552 423,655 360,639 248,234 232,051 215,004 172,412 93,983 Airport DICW Downtown RUT DRA Tech S 393,061 107,352 862,972 2,834,764 47,802 19,094 25,308 396,266 205,710 1,269,326 3,310,470 47,220 108,700 208,390 398,552 207,410 1,270,668 3,553,300 47,334 107,550 269,790 395,325 214,010 1,278,326 3,527,723 47,408 106,290 265,370 401,645 210,235 1,652,653 3,534,199 46,713 104,620 268,980 - 42,701 216,460 1,666,431 3,531,429 46,669 102,840 272,170 - 40,835 212,260 1,209,792 3,522,609 47,252 105,950 0 - 38,895 208,033 1,211,618 3,540,181 47,034 108,800 0 18,070 153,728 1,210,882 3,526,072 46,720 106,430 0 17,776 151,313 547,830 2,532,926 47,099 108,940 0 17,480 153,688 545,925 2,381,533 46,710 96,180 0 17,181 150,663 508,031 2,122,040 46,978 33,600 0 16,927 152,363 510,313 2,119,864 46,437 32,700 0 16,665 153,740 508,043 2,129,702 46,548 31,800 0 16,384 154,780 467,723 2,077,179 46,563 30,900 0 16,090 155,468 462,611 2,064,893 46,351 0 0 15,825 150,853 466,759 2,073,706 51,076 0 0 15,495 151,108 324,568 1,386,648 40,458 0 0 20,195 151,045 324,116 932,855 0 0 0 5,169 150,655 323,018 207,800 0 0 0 Totals 6,543,643 6,817,347 142,136 21,218,592 7,456,259 2,055,675 Outstanding Water Revenue Debt The Issuer has previously issued its water revenue securities. Presented belo revenue securities: 3,410,869 16,621,604 50,909,895 842,371 1,204,394 1,310,008 1 and interest on the Issuer's outstanding water Fiscal Year 4- Nov -08 18 -Oct -07 21- Sep -10 28- Jun -12 t -Sept t t- Oct -12 t- Dec -12 Total 2013 119,883 62,058 371,575 50,921 112,861 12,904 185,450 915,650 2014 117,070 62,855 377,875 130,050 112,812 47,774 193,525 1,041,961 2015 119,070 62,588 373,975 128,550 111,521 47,490 196,490 1,039,683 A -11 2016 115,750 62,288 380,075 132,050 111,448 47,149 199,400 1,048,159 2017 117,310 62,955 379,950 129,650 110,693 47,935 207,255 1,055,747 2018 118,528 62,558 379,700 127,250 111,119 47,461 0 846,615 2019 114,388 62,128 383,250 129,850 110,254 46,928 0 846,797 2020 115,158 62,665 386,500 127,300 110,571 47,520 0 849,714 2021 115,598 62,138 384,450 129,750 110,814 48,027 0 850,776 2022 115,698 62,578 387,250 132,050 110,985 47,260 0 855,820 2023 115,500 62,953 389,125 129,200 111,082 47,613 0 855,472 2024 0 62,263 510,025 131,350 111,107 47,868 0 862,613 2025 0 62,540 511,375 128,350 112,276 48,022 0 862,563 2026 0 62,753 512,200 130,350 113,228 46,886 0 865,416 2027 0 62,900 515,400 127,200 113,727 46,862 0 866,089 2028 0 62,983 517,800 129,050 113,864 47,909 0 871,605 2029 0 0 519,400 130,613 115,082 47,608 0 812,703 2030 0 0 525,200 132,019 114,644 47,182 0 819,044 2031 0 0 0 128,119 115,277 47,809 0 291,205 2032 0 0 0 129,219 0 47,066 0 176,284 Totals 1,283,950 1,001,198 7,805,125 2,512,890 2,133,363 915,271 982,120 16,633,916 Outstanding Sewer Revenue Debt The Issuer has previously issued its sewer revenue securities. Presented below is the princ revenue securities: 1 and interest on the Issuer's outstanding sewer Year 1- Aug -10 1- Feb -l0 27- Oct -10 Total 2013 3,702,611 65,950 413,990 4,182,551 2014 3,698,626 65,859 413,660 4,178,145 2015 3,694,522 65,766 413,168 4,173,455 2016 3,690,295 65,669 413,513 4,169,476 2017 3,685,941 65,570 413,663 4,165,173 2018 3,681,456 65,468 413,618 4,160,541 2019 3,676,837 65,363 413,378 4,155,577 2020 3,672,079 65,254 413,943 4,151,276 2021 3,667,178 65,143 413,280 4,145,601 2022 3,662,130 65,028 413,423 4,140,581 2023 3,656,931 64,909 413,338 4,135,178 2024 3,651,576 64,787 414,025 4,130,389 2025 3,646,061 64,662 413,453 4,124,175 2026 3,640,380 64,532 413,653 4,118,564 2027 3,634,528 64,399 413,593 4,112,520 2028 3,628,501 64,262 413,273 4,106,035 2029 3,622,293 64,120 413,693 4,100,106 2030 3,615,899 63,975 413,820 4,093,694 2031 3,609,313 63,825 413,655 4,086,793 2032 3,602,529 0 413,198 4,015,727 2033 3,595,542 0 413,448 4,008,990 2034 3,588,346 0 413,373 4,001,718 2035 3,580,933 0 413,973 3,994,906 2036 3,573,298 0 413,215 3,986,513 2037 3,565,434 0 413,133 3,978,567 2038 3,557,334 0 413,693 3,971,027 2039 3,548,991 0 413,863 3,962,854 2040 0 0 413,643 413,643 2041 0 0 414,033 414,033 Totals 98,149,565 1,234,540 11,993,700 111,377,805 Outstanding Urban Renewal TIF Revenue Debt Presented below is the Issuer's urban renewal tax increment revenue securities payable from TIF Revenues, presented by fiscal year and bond series: Fiscal TIF Rev Lower Main 40 Main 44 Main Adams Co. Theisen Supply Vessel Systems Year 10/16/07 30- Jun -04 1- Aug -09 26-Oct-10 3- Dec -04 22- Nov -06 1- Dec -03 2013 2,012,625 26,700 95,408 34,584 51,004 120,000 20,607 2014 355,000 26,699 95,410 34,583 51,004 119,999 20,608 2015 380,000 26,700 95,408 34,584 49,156 120,000 20,607 2016 410,000 25,615 95,409 34,583 0 119,999 0 2017 440,000 0 95,408 34,584 0 120,000 0 2018 475,000 0 74,766 19,283 0 112,079 0 A -12 2019 510,000 2020 550,000 2021 590,000 2022 635,000 2023 680,000 2024 730,000 2025 785,000 2026 845,000 2027 910,000 2028 975,000 2029 1,050,000 2030 1,130,000 2031 1,215,000 2032 1,305,000 2033 1,400,000 2034 1,505,000 2035 1,620,000 2036 1,740,000 2037 1,870,000 0 79,826 20,473 0 85,175 21,703 0 90,880 23,079 0 0 24,503 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Totals: 24,117,625 105,714 807,690 281,959 Indirect General Obligation Debt Presented below is a listing of the overlapping and underlying debt for Issuers Taxing Authority Dubuque CSD Dubuque County AEA1 Northeast Iowa Community College Outstanding 2011 Taxable Debt Valuation $0 $3,296,962,298 0 4,209,535,799 2,005,403 9,846,541,918 59,880,000 9,846,541,918 151,164 712,077 61,822 thin the District and the amount applicable to the Issuer: Taxable Value Within Issuer 2,410,966,455 2,410,966,455 2,410,966,455 2,410,966,455 Percentage Applicable 73.13% 57.27% 24.49% 24.49% Amount Applicable $0 0 491,031 14,661,865 Total Overlapping & Underlying Debt: $15,152,8% FINANCIAL SUMMARY Actual Value of Property, 2011: $3,633,349,677 Taxable Value of Property, 2011: 2,410,966,445 Direct General Obligation Debt: Less Self - Supported General Obligation Debt: Net Direct General Obligation Debt: Overlapping Debt: Net Direct & Overlapping General Obligation Debt: Population, 2010 US Census Bureau: Direct Debt per Capita: Total Debt per Capita: Net Direct Debt to Taxable Valuation: Total Debt to Taxable Valuation: Net Direct Debt to Actual Valuation: Total Debt to Actual Valuation: Actual Valuation per Capita: Taxable Valuation per Capita: Preliminary, subject to change A -13 $95,460,000 - 88,930,000 $6,530,000 15,152,896 $21,682,896 57,637 $1,656.23 $376.20 0.27% 0.90% 0.18% 0.60% $63,038 $41,830 APPENDIX B- FORM OF LEGAL OPINIONS B -1 APPENDIX C - FORM OF CONTINUINGDISCLOSURE CERTIFICATE 01