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Storm Water Utility Revenue Captial Loan Notes Taxable Series 2014A_$1.029M SRFMasterpiece on the Mississippi TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager Dubuque band AI- America City 1 2007 • 2012 • 2013 SUBJECT: Procedure to Authorize Issuance of $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A (State of Iowa Revolving Fund Loan) DATE: February 11, 2014 Finance Director Ken TeKippe is providing the suggested proceedings to authorize issuance of $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A (State of Iowa Revolving Fund Loan) through the Iowa Water Pollution Control Works Financing Program. There is no public hearing required since the hearing held in connection with issuance of the Series 2010G Note was large enough to include both Notes, and both Notes finance the same project that was the subject of the earlier hearing. Finance Director Ken TeKippe recommends City Council approval of a resolution to approve and authorize the form of Loan and Disbursement Agreement and authorize the issuance of the Series 2014A Notes to the Iowa Finance Authority. The Loan and Disbursement Agreement also sets forth a number of covenants and agreements on the part of the City with respect to the repayment on the loan. I concur with the recommendation and respectfully request Mayor and City Council approval. Mic ael C. Van Milligen MCVM:jh Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Teri Goodmann, Assistant City Manager Kenneth J. TeKippe, Finance Director THE CITY OF Dui Masterpiece on the Mississippi Dubuque trati M- America City �1111� 2007 • 2012 • 2013 TO: Michael C. Van Milligen, City Manager FROM: Kenneth J. TeKippe, Finance Director DATE: February 11, 2014 SUBJECT: Procedure to Authorize Issuance of $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A (State of Iowa Revolving Fund Loan) DISCUSSION The purpose of this memorandum is to provide suggested proceedings to authorize issuance of $1 D29,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A (State of Iowa Revolving Fund Loan) through the Iowa Water Pollution Control Works Financing Program. There is no public hearing required since the hearing held in connection with issuance of the Series 2010G Note was large enough to include both Notes, and both Notes finance the same project that was the subject of the earlier hearing.A copy of the state revolving loan fund (SRF) application for a supplemental loan for the Lower Bee Branch Creek Restoration Project is enclosed. The City is able to take advantage of the 1.75 %fixed interest rate for 20 years with a .25% annual administrative fee associated with the borrowing. There is a one -time .50% loan origination fee for the borrowing. The loan funds will be used to reimburse the City for legal fees and increased construction costs associated with the Lower Bee Branch Creek Restoration Project The Note is being issued as a taxable obligation, rather than as a tax - exempt obligation, with the consent of the Authority. The Authority also will be asked to waive the need for a "parity certificate" from an independent auditor which would certify to the adequacy of the net revenues of the Storm Water Utility System, since the Authority holds all of the outstanding obligations of the System. The resolution approves and authorizes the form of Loan and Disbursement Agreement and authorizes the issuance of the Series 2014A Notes to the Iowa Finance Authority. The Loan and Disbursement Agreement also sets forth a number of covenants and agreements on the part of the City with respect to the repayment on the loan. This is the final City Council action required on the Series 2014A Notes. A letter from Attorney William Noth detailing information on the loan is enclosed. Prepared by: KT /eml Enclosures cc: cc: Barry Lindahl, City Attorney Jenny Larson, Budget Director Cindy Steinhauser, Assistant City Manager AHLERs . >COON Y, P.C. ATTORNEYS AT LAW 100 COURT AVENUE • SUITE 600 DES MOINES, IOWA 50309 -2231 PHONE 515- 243 -7611 FAX: 515- 243 -2149 WWW.AHLERSLAW.COM WILLIAM J. NOTH WNOTH @AHLERSLAW.COM February 5, 2014 Mr. Ken TeKippe Finance Officer City of Dubuque 50 West 13th Street Dubuque, Iowa 52001 -4864 Direct Dial: (515)246 -0332 RE: $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A (State of Iowa Revolving Fund Loan) Dear Mr. TeKippe: With this letter I am enclosing suggested Council proceedings taking action to authorize issuance of the above Note. As we have discussed, no public hearing is required in this instance, because the hearing held in connection with the issuance of the Series 2010G Note was large enough to include both Notes, and both Notes finance the same project that was the subject of the earlier hearing. These facts are described in the preambles to the resolution that is included as part of the Council proceedings. The resolution approves and authorizes the form of Loan and Disbursement Agreement and authorizes the issuance of the above Note to the Iowa Finance Authority (the "Authority "). The Loan and Disbursement Agreement sets forth a number of covenants and agreements on the part of the Council with respect to the repayment of the Loan. The Note is being issued as a taxable obligation, rather than as a tax - exempt obligation, with the consent of the Authority. The Authority also will be asked to waive the need for a "parity certificate" from an independent auditor which would certify to the adequacy of the net revenues of the Storm Water Utility System, since the Authority holds all of the outstanding obligations of the System. February 5, 2014 Page 2 Also enclosed are the final closing certificates. The Transcript Certificate can be completed and dated as soon as Council action has been taken. The Delivery Certificate should be executed but left undated. Please insert the requested financial data in the blank spaces provided on page 2 of the Delivery Certificate. Similarly, the Loan and Disbursement Agreement should be signed and sealed but left undated. The dates will be added pursuant to authorization from the City at the time of final closing and delivery of the Note to the Authority. Please return these certificates and all copies of the Agreement to me for holding and review before the closing arrangements are made. Original Note R -1 is enclosed as well. The Note should be manually signed by the Mayor and City Clerk and by the Treasurer as the Registrar where indicated. The date of authentication and date of delivery are not known at this time and should be left blank; both dates will be inserted as of the actual closing date of the Loan. The completed Note also should be returned to us for holding prior to closing. Finally, an extra copy of the proceedings is enclosed to be completed as the original and returned to us for our transcript of the action taken. If any questions arise, please don't hesitate to call. Yours very truly, William J. Noth WJN:dc encl. cc: Barry Lindahl (w /encl.) Jenny Larson (w /encl.) 00997173 -1 \10422 -149 (This Notice to be posted) NOTICE AND CALL OF PUBLIC MEETING Governmental Body: The City Council of Dubuque, Iowa. Date of Meeting: February 17 2014. 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 said meeting is as follows: $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A Resolution approving and authorizing a form of Loan and Disbursement Agreement by and between the City of Dubuque and the Iowa Finance Authority, and authorizing and providing for the issuance and securing the payment of $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A, of the City of Dubuque, Iowa, under the provisions of the Code of Iowa, and providing for a method of payment of said Notes. Such additional matters as are set forth on the additional 31 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 said governmental body. City Cler , 4D ubuque, Iowa �'� /;',,,w 00* February 17 2014 The City Council 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 Braig introduced the following Resolution entitled "A RESOLUTION APPROVING AND AUTHORIZING FORM OF LOAN AND DISBURSEMENT AGREEMENT BY AND BETWEEN THE CITY OF DUBUQUE AND THE IOWA FINANCE AUTHORITY, AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $1,029,000 STORM WATER UTILITY REVENUE CAPITAL LOAN NOTES, TAXABLE SERIES 2014A, OF THE CITY OF DUBUQUE, IOWA, UNDER THE PROVISIONS OF THE CODE OF IOWA, AND PROVIDING FOR A METHOD OF PAYMENT OF SAID NOTES ", and moved its adoption. Council Member Connors seconded the motion to adopt. The roll was called and the vote was: AYES: Resnick, Sutton, Braig, Buol, Connors, Jones, Lynch NAYS: Whereupon the Mayor declared the following Resolution duly adopted: RESOLUTION NO. 47 -14 A RESOLUTION APPROVING AND AUTHORIZING THE FORM OF LOAN AND DISBURSEMENT AGREEMENT BY AND BETWEEN THE CITY OF DUBUQUE AND THE IOWA FINANCE AUTHORITY, AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $1,029,000 STORM WATER UTILITY REVENUE CAPITAL LOAN NOTES, TAXABLE SERIES 2014A, OF THE CITY OF DUBUQUE, IOWA, UNDER THE PROVISIONS OF THE CODE OF IOWA, AND PROVIDING FOR A METHOD OF PAYMENT OF SAID NOTES WHEREAS, the City Council of the City of Dubuque, Iowa, sometimes hereinafter referred to as the "Issuer ", has heretofore established charges, rates and rentals for services which are and will continue to be collected as system revenues of the Storm Water Utility System, sometimes hereinafter referred to as the "System ", and said revenues have not been pledged and are available for the payment of revenue Notes, subject to the following premises; and WHEREAS, Issuer proposes to issue its Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A, to the extent of $1,029,000, for the purpose of defraying the costs of the Project as set forth in Section 1 of this Resolution; and, it is deemed necessary and advisable and in the best interests of the City that the form of Loan and Disbursement Agreement by and between the City and the Iowa Finance Authority, be approved and authorized; and WHEREAS, the Issuer has previously issued $998,000 Storm Water Utility Revenue Capital Loan Notes, Series 2010B, dated January 13, 2010 and $7,850,000 Storm Water Utility Revenue Capital Loan Notes, Series 2010G, dated October 27, 2010 (together, the "Outstanding Obligations "), each payable from the net revenues of the System; and WHEREAS, prior to issuance of the $7,850,000 Storm Water Utility Revenue Capital Loan Notes, Series 2010G, the Issuer held a public hearing and took additional action for the issuance of not to exceed $10,100,000 Storm Water Utility Revenue Capital Loan Notes for the purpose of paying costs of constructing storm water drainage projects and improvements, including those costs associated with the Lower Bee Branch Creek Restoration Project and the refinancing of a portion of the $1,889,521 General Obligation Capital Loan Notes Anticipation Project Note, Series 2006, dated December 28, 2006, issued in respect of such costs; and 3 WHEREAS, there remains up to $2,250,000 of Storm Water Utility Revenue Capital Loan Notes that may be issued for the Lower Bee Branch Creek Restoration Project under the foregoing hearing and resolution taking additional action; and WHEREAS, in the resolutions authorizing the issuance of the Outstanding Obligations it is provided that additional revenue notes may be issued on a parity with the outstanding notes or bonds, for the costs of future improvements and extensions to the System, provided that there has been procured and placed on file with the City Clerk, a statement complying with the conditions and limitations therein imposed upon the issuance of said parity notes or bonds; and WHEREAS, the Iowa Finance Authority, as the sole holder of the Outstanding Obligations, has agreed to waive the requirement that a statement of an independent certified public accountant be placed on file in the office of the City Clerk prior to Closing, showing the conditions and limitations of the resolution authorizing the Outstanding Obligations, with regard to the sufficiency of the revenues of the System to permit the issuance of additional revenue notes or bonds ranking on a parity with the Outstanding Obligations to have been met and satisfied as required. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IN THE COUNTY OF DUBUQUE, STATE OF IOWA: Section 1. Definitions. The following terms shall have the following meanings in this Resolution unless the text expressly or by necessary implication requires otherwise: • "Additional Notes" shall mean any storm water utility revenue notes or notes issued on a parity with the Notes in accordance with the provisions of this Resolution. • "Agreement" shall mean the Loan and Disbursement Agreement, dated as of the Closing between the City and the Original Purchaser, relating to the Loan made to the City under the Program. • "Authorized Denominations" shall mean $5,000 or any integral multiple thereof. • "Clerk" shall mean the City Clerk or such other officer of the successor Governing Body as shall be charged with substantially the same duties and responsibilities. 4 • "Closing" shall mean the date of delivery of the Note to the Original Purchaser and the funding of the Loan by the Trustee. • "Corporate Seal" shall mean the official seal of Issuer adopted by the Governing Body. • "Fiscal Year" shall mean the twelve -month period beginning on July 1 of each year and ending on the last day of June of the following year, or any other consecutive twelve -month period adopted by the Governing Body or by law as the official accounting period of the System. Requirements of a Fiscal Year as expressed in this Resolution shall exclude any payment of principal or interest falling due on the first day of the Fiscal Year and include any payment of principal or interest falling due on the first day of the succeeding Fiscal Year. • "Governing Body" shall mean the City Council of the City, or its successor in function with respect to the operation and control of the System. • "Independent Auditor" shall mean an independent firm of Certified Public Accountants or the Auditor of State. • "Issuer" and "City" shall mean the City of Dubuque, Iowa. • "Loan" shall mean the principal amount allocated by the Original Purchaser to the City under the Program, equal in amount to the principal amount of the Notes; • "Net Revenues" shall mean gross earnings of the System after deduction of Current Expenses; "Current Expenses" shall mean and include the reasonable and necessary cost of operating, maintaining, repairing and insuring the System, including purchases at wholesale, if any, salaries, wages, and costs of materials and supplies, but excluding depreciation and principal of and interest on the Notes and any Parity Obligations or payments to the various funds established herein; capital costs, depreciation and interest or principal payments are not System expenses. • "Notes" or "Note" shall mean $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A, authorized to be issued by this Resolution • "Original Purchaser" shall mean the Iowa Finance Authority, as the purchaser of the Notes from Issuer at the time of their original issuance. 5 • "Outstanding Obligations" shall mean the $998,000 Storm Water Utility Revenue Capital Loan Notes, Series 2010B, dated January 13, 2010 and the $7,850,000 Storm Water Utility Revenue Capital Loan Notes, Series 2010G, dated October 27, 2010. • "Parity Obligations" shall mean storm water notes or bonds payable solely from the Net Revenues of the System on an equal basis with the Notes herein authorized to be issued, and shall include the Outstanding Obligations. • "Paying Agent" shall mean the City Treasurer, or such successor as may be approved by Issuer as provided herein and who shall carry out the duties prescribed herein as Issuer's agent to provide for the payment of principal of and interest on the Notes as the same shall become due. • "Permitted Investments" shall mean: • direct obligations of (including obligations issued or held in book entry form on the books of) the Department of the Treasury of the United States of America; ■ obligations of any of the following federal agencies which obligations represent full faith and credit of the United States of America, including: - Export - Import Bank - Farm Credit System Financial Assistance Corporation - USDA - Rural Development - General Services Administration — U.S. Maritime Administration - Small. Business Administration - Government National Mortgage Association (GNMA) - U.S. Department of Housing & Urban Development (PHA's) — Federal Housing Administration • repurchase agreements whose underlying collateral consists of the investments set out above if the Issuer takes delivery of the collateral either directly or through an authorized custodian. Repurchase agreements do not include reverse repurchase agreements; • senior debt obligations rated "AAA" by Standard & Poor's Corporation (S &P) or "Aaa" by Moody's Investors Service Inc. (Moody's) 6 issued by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation; • U.S. dollar denominated deposit accounts, federal funds and banker's acceptances with domestic commercial banks which have a rating on their short-term certificates of deposit on the date of purchase of "A -1" or "A -1 +" by S &P or "P -1" by Moody's and maturing no more than 360 days after the date of purchase (ratings on holding companies are not considered as the rating of the bank); • commercial paper which is rated at the time of purchase in the single highest class ification, "A -1 +" by S &P or "P -1" by Moody's and which matures not more than 270 days after the date of purchase; • investments in a money market fund rated "AAAm" or "AAArn -G" or better by S &P; • pre - refunded municipal obligations, defined as any notes or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on the date specified in the notice; and (a) which are rated, based on an irrevocable escrow account or fund (the "escrow "), in the highest rating category of S &P or Moody's or any successors thereto; or (b)(i) which are fully secured as to principal and interest and redemption premium, if any, by an escrow consisting only of cash or direct obligations of the Department of the Treasury of the United States of America, which escrow may be applied only to the payment of such principal of and interest and redemption premium, if any, on such notes or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate; and (ii) which escrow is sufficient, as verified by a nationally recognized independent certified public accountant, to pay principal of and interest and redemption premium, if any, on the notes or other obligations described in this paragraph on the maturity date or dates specified in the irrevocable instructions referred to above, as appropriate; • tax exempt notes as defined and permitted by section 148 of the Internal Revenue Code and applicable regulations and only if rated within the two highest classifications as established by at least one of the standard rating services approved by the superintendent of banking by rule adopted pursuant to chapter 17A Code of Iowa; • an investment contract rated within the two highest classifications as established by at least one of the standard rating services approved by the superintendent of banking by rule adopted pursuant to chapter 17A Code of Iowa; and • Iowa Public Agency Investment Trust. • "Prior Note Resolutions" shall mean Resolution No. 467 -09, approved on December 21, 2009 and Resolution No. 404 -10, approved on October 18, 2010, authorizing the issuance of the Outstanding Obligations. • "Program" shall mean the Iowa Water Pollution Control Works Financing Program undertaken by the Original Purchaser. "▪ Project" shall mean the costs of constructing storm water drainage projects and improvements, including those costs associated with the Lower Bee Branch Creek Restoration Project. • "Project Fund" shall mean the Loan Account maintained by the Trustee under the Program for the benefit of the Issuer, into which the proceeds of the Loan and the Note shall be allocated and held until disbursed to pay Project costs. • "Registrar" shall mean the City Treasurer or such successor as may be approved by Issuer as provided herein and who shall carry out the duties prescribed herein with respect to maintaining a register of the owners of the Notes. Unless otherwise specified, the Registrar shall also act as Transfer Agent for the Notes. "Resolution" shall mean this resolution authorizing the issuance of the Notes. • "System" shall mean the Storm Water Utility of the Issuer and all properties of every nature hereinafter owned by the Issuer comprising part of or used as a part of the System, including all improvements and extensions made by Issuer while any of the Notes or Parity Notes remain outstanding; all real and personal property; and all appurtenances, contracts, leases, franchises and other intangibles. 8 "Treasurer" shall mean the City Treasurer or such other officer as shall • succeed to the same duties and responsibilities with respect to the recording and payment of the Notes issued hereunder. Section 2. Authority. The Agreement and the Notes authorized by this Resolution shall be issued pursuant to Division V, Chapter 384 of the City Code of Iowa, and in compliance with all applicable provisions of the Constitution and laws of the State of Iowa. The Agreement shall be substantially in the form attached to this Resolution and are authorized to be executed and issued on behalf of the Issuer by the Mayor and attested by the City Clerk. Section 3. Authorization and Purpose. There are hereby authorized to be issued, negotiable, serial, fully registered Storm Water Utility Revenue Capital Loan Notes of Dubuque, in the County of Dubuque, State of Iowa, Taxable Series 2014A, in the aggregate amount of $1,029,000 for the purpose of paying costs of constructing storm water drainage projects and improvements, including those costs associated with the Lower Bee Branch Creek Restoration Project. The City Council, pursuant to Sections 384.24A and 384.84A of the Code of Iowa, hereby finds and determines that it is necessary and advisable to issue said Notes authorized by the Agreement and this Resolution. Section 4. Source of Payment. The Notes herein authorized and Parity Notes and the interest thereon shall be payable solely and only out of the net earnings of the System and shall be a lien on the future Net Revenues of the System. The Notes shall not be general obligations of the Issuer nor shall they be payable in any manner by taxation and the Issuer shall be in no manner liable by reason of the failure of the said Net Revenues to be sufficient for the payment of the Notes. Section 5. Note Details. Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A, of the City in the amount of $1,029,000, shall be issued to evidence the obligations of the Issuer under the Agreement pursuant to the provisions of Sections 384.24A and 384.84A of the Code of Iowa for the aforesaid purpose. The Notes shall be designated "STORM WATER UTILITY REVENUE CAPITAL LOAN NOTE, TAXABLE SERIES 2014A ", be dated the date of delivery, and bear interest at the rate of 1.75% per annum from the date of each advancement made under the Agreement, until payment thereof, at the office of the Paying Agent, said interest payable on June 1, 2014, and semi - annually thereafter on the 1st day of June and December in each year until maturity as set forth on the Debt Service Schedules attached to the Agreement as Exhibit A and incorporated herein by this reference. As set forth on said Debt Service Schedule, principal shall be payable on June 1, 2014 and annually thereafter on the 1st day of June in the amounts set forth therein until principal and interest are fully paid, except that the final 9 installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June 1, 2033. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be payable as shown on said Debt Service Schedule until completion of the Project, at which time the final Debt Service Schedule shall be determined by the Trustee based upon actual advancements, final costs and completion of the Project, all as provided in the administrative rules governing the Program. Payment of principal and interest on the Notes shall at all times conform to said Debt Service Schedule and the rules of the Program. The Notes shall be executed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the Clerk, and impressed or imprinted with the seal of the City and shall be fully registered as to both principal and interest as provided in this Resolution; principal, interest and premium, if any, shall be payable at the office of the Paying Agent by mailing of a check, wire transfer or automated clearing house system transfer to the registered owner of the Note. The Notes shall be in the denomination of $1,000 or multiples thereof and may at the request of the Original Purchaser be initially issued as a single Note in the denomination of $1,029,000 numbered R -1. Section 6. Initiation Fee and Servicing Fee. In addition to the payment of principal of and interest on the Notes, the Issuer also agrees to pay the Initiation Fee and the Servicing Fee as defined and in accordance with the terms of the Agreement. Section 7. Redemption. The Notes are subject to optional redemption at a price of par plus accrued interest (i) on any date upon receipt of written consent of the Original Purchaser or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of the Notes may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity, by giving not less than thirty (30) days' notice of redemption by certified or registered mail to the Original Purchaser (or any other registered owner of the Note). The terms of redemption shall be par, plus accrued interest to date of call. The Notes are also subject to mandatory redemption as set forth in Section 5 of the Agreement. Section 8. Registration of Notes; Appointment of Registrar; Transfer; Ownership; Delivery; and Cancellation. (a) Registration. The ownership of Notes may be transferred only by the making of an entry upon the books kept for the registration and transfer of ownership of the Notes, and in no other way. The Treasurer is hereby appointed as Note Registrar under the terms of this Resolution. Registrar shall maintain the books of the Issuer for the registration of ownership of the Notes for the payment of 10 principal of and interest on the Notes as provided in this Resolution. All Notes shall be negotiable as provided in Article 8 of the Uniform Commercial Code subject to the provisions for registration and transfer contained in the Notes and in this Resolution. (b) Transfer. The ownership of any Note may be transferred only upon the Registration Books kept for the registration and transfer of Notes and only upon surrender thereof at the office of the Registrar together with an assignment duly executed by the holder or his duly authorized attorney in fact in such form as shall be satisfactory to the Registrar, along with the address and social security number or federal employer identification number of such transferee (or, if registration is to be made in the name of multiple individuals, of all such transferees). In the event that the address of the registered owner of a Note (other than a registered owner which is the nominee of the broker or dealer in question) is that of a broker or dealer, there must be disclosed on the Registration Books the information pertaining to the registered owner required above. Upon the transfer of any such Note, a new fully registered Note, of any denomination or denominations permitted by this Resolution in aggregate principal amount equal to the unmatured and unredeemed principal amount of such transferred fully registered Note, and bearing interest at the same rate and maturing on the same date or dates shall be delivered by the Registrar. (c) Registration of Transferred Notes. In all cases of the transfer of the Notes, the Registrar shall register, at the earliest practicable time, on the Registration Books, the Notes, in accordance with the provisions of this Resolution. (d) Ownership. As to any Note, the person in whose name the ownership of the same shall be registered on the Registration Books of the Registrar shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of the principal of any such Notes and the premium, if any, and interest thereon shall be made only to or upon the order of the registered owner thereof or his legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Note, including the interest thereon, to the extent of the sum or sums so paid. (e) Cancellation. All Notes which have been redeemed shall not be reissued but shall be cancelled by the Registrar. All Notes which are cancelled by the Registrar shall be destroyed and a Certificate of the destruction thereof shall be furnished promptly to the Issuer; provided that if the Issuer shall so direct, the Registrar shall forward the cancelled Notes to the Issuer. 11 (f) Non - Presentment of Notes. In the event any payment check representing payment of principal of or interest on the Notes is returned to the Paying Agent or if any note is not presented for payment of principal at the maturity or redemption date, if funds sufficient to pay such principal of or interest on Notes shall have been made available to the Paying Agent for the benefit of the owner thereof, all liability of the Issuer to the owner thereof for such interest or payment of such Notes shall forthwith cease, terminate and be completely discharged, and thereupon it shall be the duty of the Paying Agent to hold such funds, without liability for interest thereon, for the benefit of the owner of such Notes who shall thereafter be restricted exclusively to such funds for any claim of whatever nature on his part under this Resolution or on, or with respect to, such interest or Notes. The Paying Agent's obligation to hold such funds shall continue for a period equal to two years and six months following the date on which such interest or principal became due, whether at maturity, or at the date fixed for redemption thereof, or otherwise, at which time the Paying Agent, shall surrender any remaining funds so held to the Issuer, whereupon any claim under this Resolution by the Owners of such interest or Notes of whatever nature shall be made upon the Issuer. Section 9. Reissuance of Mutilated, Destroyed, Stolen or Lost Notes. In case any outstanding Note shall become mutilated or be destroyed, stolen or lost, the Issuer shall at the request of Registrar authenticate and deliver a new Note of like tenor and amount as the Note so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Note to Registrar, upon surrender of such mutilated Note, or in lieu of and substitution for the Note destroyed, stolen or lost, upon filing with the Registrar evidence satisfactory to the Registrar and Issuer that such Note has been destroyed, stolen or lost and proof of ownership thereof, and upon furnishing the Registrar and Issuer with satisfactory indemnity and complying with such other reasonable regulations as the Issuer or its agent may prescribe and paying such expenses as the Issuer may incur in connection therewith. Section 10. Record Date. Payments of principal and interest, otherwise than upon full redemption, made in respect of any Note, shall be made to the registered holder thereof or to their designated Agent as the same appear on the books of the Registrar on the 15th day of the month preceding the payment date. All such payments shall fully discharge the obligations of the Issuer in respect of such Notes to the extent of the payments so made. Section 11. Execution, Authentication and Delivery of the Notes. Upon the adoption of this Resolution, the Mayor and City Clerk shall execute and deliver the Notes to the Registrar, who shall authenticate the Notes and deliver the same to or upon order of the Original Purchaser. No Note shall be valid or obligatory for any purpose or shall be 12 entitled to any right or benefit hereunder unless the Registrar shall duly endorse and execute on such Note a Certificate of Authentication substantially in the form of the Certificate herein set forth. Such Certificate upon any Note executed on behalf of the Issuer shall be conclusive evidence that the Note so authenticated has been duly issued under this Resolution and that the holder thereof is entitled to the benefits of this Resolution. Section 12. Right to Name Substitute Paying Agent or Registrar. Issuer reserves the right to name a substitute, successor Registrar or Paying Agent upon giving prompt written notice to each registered noteholder. 13 Section 13. Form of Note. Notes shall be printed in substantial compliance with standards proposed by the American Standards Institute substantially in the form as follows: (6) (7) (6) (8) (1) (2) (3) (4) (5) (9) (9a) (10) (Continued on the back of this Note) (11)(12)(13) (14) FIGURE 1 (Front) 14 (15) (10) (Continued) (16) FIGURE 2 (Back) 15 The text of the Notes to be located thereon at the item numbers shown shall be as follows: Item 1, figure 1 = "STATE OF IOWA" "COUNTY OF DUBUQUE" "CITY OF DUBUQUE" "STORM WATER UTILITY REVENUE CAPITAL LOAN NOTE" "TAXABLE SERIES 2014A" Item 2, figure 1 = Rate: 1.75% Item 3, figure 1 = Final Maturity: June 1, 2033 Item 4, figure 1 = Note Date: Item 5, figure 1 = CUSIP # Item 6, figure 1 = "Registered" Item 7, figure 1 = Certificate No. R -1 Item 8, figure 1 = Principal Amount: $1,029,000 Item 9, figure 1 = The City of Dubuque, Iowa, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of Iowa (the "Issuer "), for value received, promises to pay from the source and as hereinafter provided, on the maturity date indicated above, to IOWA FINANCE AUTHORITY Item 10, figure 1 = or registered assigns, the principal sum of (principal amount written out) in lawful money of the United States of America, on the maturity dates and in the principal amounts set forth on the Debt Service Schedule attached hereto and incorporated herein by this reference, with interest on said sum from the date of each advancement made under a certain Loan and Disbursement Agreement, dated as of the date hereof until paid at the rate of 1.75% per annum, payable on June 1, 2014, and semi- annually thereafter on the 1st day of June and December in each year. As set forth on said Debt Service Schedule, principal shall be payable on June 1, 2014 and annually thereafter on the first day of June in the amounts set forth therein until principal and interest are fully paid, except that the final installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June 1, 2033. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be payable as shown on said Debt Service Schedule until completion of the Project, at which time the final Debt Service Schedule shall be determined by the Trustee and attached hereto based upon actual advancements, final costs and completion of the Project, all as provided in the administrative rules governing the Iowa Water Pollution Control Works Financing 16 Program. Payment of principal and interest of this Note shall at all times conform to said Debt Service Schedule and the rules of the Iowa Water Pollution Control Works Financing Program. Interest and principal shall be paid to the registered holder of the Note as shown on the records of ownership maintained by the Registrar as of the 15th day of the month next preceding such interest payment date. Interest shall be computed on the basis of a 360 day year of twelve 30 -day months. This Note is issued pursuant to the provisions of Sections 384.24A and 384.83 of the Code of Iowa, for the purpose of paying costs of constructing storm water drainage projects and improvements, including those costs associated with the Lower Bee Branch Creek Restoration Project, and evidences amounts payable under a certain Loan and Disbursement Agreement, dated as of the date hereof, in conformity to a Resolution of the Council of said City duly passed and approved. For a complete statement of the revenues and funds from which and the conditions under which this Note is payable, a statement of the conditions under which additional notes or bonds of equal standing may be issued, and the general covenants and provisions pursuant to which this Note is issued, reference is made to the above - described Loan and Disbursement Agreement and Resolution. This Note is subject to optional redemption at a price of par plus accrued interest (i) on any date upon receipt of written consent of the Iowa Finance Authority or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of this Note may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity, by lot by giving thirty (30) days' notice of redemption by certified or registered mail, to the Iowa Finance Authority (or any other registered owner of the Note). This Note is also subject to mandatory redemption as set forth in Section 5 of the Agreement. Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the City Treasurer, Dubuque, Iowa, the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Note at the office of the Registrar, together with an assignment duly executed by the owner hereof or his duly authorized attorney in the form as shall be satisfactory to the Registrar. Issuer reserves the right to substitute the Registrar and Paying Agent but shall, however, promptly give notice to registered Noteholders of such change. All Notes shall be negotiable as provided in Article 8 of the Uniform Commercial Code and subject to the provisions for registration and transfer contained in the Note Resolution. This Note and the series of which it forms a part, other notes ranking on a parity therewith, and any additional bonds or notes which may be hereafter issued and 17 outstanding from time to time on a parity with said Notes, as provided in the Resolution of which notice is hereby given and is hereby made a part hereof, are payable from and secured by a pledge of the Net Revenues of the Storm Water Utility (the "System "), as defined and provided in said Resolution. There has heretofore been established and the City covenants and agrees that it will maintain just and equitable rates or charges for the use of and service rendered by said System in each year for the payment of the proper and reasonable expenses of operation and maintenance of said System and for the establishment of a sufficient sinking fund to meet the principal of and interest on this series of Notes, and other notes ranking on a parity therewith, as the same become due. This Note is not payable in any manner by taxation and under no circumstances shall the City be in any manner liable by reason of the failure of said net earnings to be sufficient for the payment hereof. And it is hereby represented and certified that all acts, conditions and things requisite, according to the laws and Constitution of the State of Iowa, to exist, to be had, to be done, or to be performed precedent to the lawful issue of this Note, have been existent, had, done and performed as required by law. IN TESTIMONY WHEREOF, said City by its City Council has caused this Note to be signed by the manual signature of its Mayor and attested by the manual signature of its Clerk, with the seal of said City impressed hereon, and authenticated by the manual signature of an authorized representative of the Registrar, the City Treasurer, Dubuque, Iowa. Item 11, figure 1 = Date of authentication: Item 12, figure 1 = This is one of the Notes described in the within mentioned Resolution, as registered by the City Treasurer CITY TREASURER, Registrar By: Authorized Signature Item 13, figure 1 = Registrar and Transfer Agent: City Treasurer Paying Agent: City Treasurer SEE REVERSE FOR CERTAIN DEFINITIONS 18 Item 14, figure 1 = (Seal) Item 15, figure 1 = [Signature Block] CITY OF DUBUQUE, IOWA By: Mayor 's manual signature Mayor ATTEST: By: City Clerk's manual signature City Clerk Item 16, figure 2 = [Assignment Block] [Information Required for Registration] ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (Social Security or Tax Identification No. ) the within Note and does hereby irrevocably constitute and appoint attorney in fact to transfer the said Note on the books kept for registration of the within Note, with full power of substitution in the premises. Dated SIGNATURE ) GUARANTEED ) (Person(s) executing this Assignment sign(s) here) IMPORTANT - READ CAREFULLY The signature(s) to this Power must correspond with the name(s) as written upon the face of the certificate(s) or Note(s) in every particular without alteration or enlargement or any change whatever. Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may 19 require signature to be guaranteed by certain eligible guarantor institutions that participate in a recognized signature guarantee program. INFORMATION REQUIRED FOR REGISTRATION OF TRANSFER Name of Transferee(s) Address of Transferee(s) Social Security or Tax Identification Number of Transferee(s) Transferee is a(n): Individual* Corporation Partnership Trust *If the Note is to be registered in the names of multiple individual owners, the names of all such owners and one address and social security number must be provided. The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common IA UNIF TRANS MIN ACT - Custodian (Cust) (Minor) under Iowa Uniform Transfers to Minors Act (State) ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT IN THE ABOVE LIST Section 14. Equality of Lien. The timely payment of principal of and interest on the Notes and Parity Notes shall be secured equally and ratably by the Net Revenues of the System without priority by reason of number or time of sale or delivery; and the Net Revenues of the System are hereby irrevocably pledged to the timely payment of both principal and interest as the same become due. 20 Section 15. Application of Note Proceeds - Project Fund. Proceeds of the Notes shall be applied as follows: An amount equal to the Initiation Fee and other costs of issuance of the Notes shall be applied to pay such costs as may be approved by the Treasurer. The balance of the proceeds shall be deposited to the Project Fund and expended therefrom for the purposes of issuance. Any amounts on hand in the Project Fund shall be available for the payment of the principal of or interest on the Notes at any time that other funds of the System shall be insufficient to the purpose, in which event such funds shall be repaid to the Project Fund at the earliest opportunity. Any balance on hand in the Project Fund and not immediately required for its purposes may be invested not inconsistent with limitations provided by law, the Internal Revenue Code and this Resolution. Any excess proceeds remaining on hand after completion of the purpose of issuance shall be paid into the Improvement Fund to the maximum required amounts and any remaining amounts shall be used to call or otherwise retire Notes. Section 16. User Rates. There has heretofore been established and published as required by law, just and equitable rates or charges for the use of the service rendered by the System. Said rates or charges to be paidby the owner of each and every lot, parcel of real estate, or building that is connected with and uses the System, by or through any part of the System or that in any way uses or is served by the System. Any revenues paid and collected for the use of the System and its services by the Issuer or any department, agency or instrumentality of the Issuer shall be used and accounted for in the same manner as any other revenues derived from the operations of the System. Section 17. Application of Revenues. From and after the delivery of any Notes, and as long as any of the Notes or Parity Notes shall be outstanding and unpaid either as to principal or as to interest, or until all of the Notes and Parity Notes then outstanding shall have been discharged and satisfied in the manner provided in this Resolution, the entire income and revenues of the System shall be deposited as collected in a fund to be known as the Storm Water Utility Revenue Fund (the "Revenue Fund "), and shall be disbursed only as follows: (a) Operation and Maintenance Fund. Money in the Revenue Fund shall first be disbursed to make deposits into a separate and special fund to pay current expenses. The fund shall be known as the Storm Water Utility Revenue Operation and 21 Maintenance Fund (the "Operation and Maintenance Fund "). There shall be deposited in the Operation and Maintenance Fund each month an amount sufficient to meet the current expenses of the month plus an amount equal to 1 /12th of expenses payable on an annual basis such as insurance. After the first day of the month, further deposits may be made to this account from the Revenue Fund to the extent necessary to pay current expenses accrued and payable to the extent that funds are not available in the Surplus Fund. (b) Sinking Fund. Money in the Revenue Fund shall next be disbursed to make deposits into a separate and special fund to pay the principal and interest requirements of the Fiscal Year on the Notes and Parity Notes. The fund shall be known as the Storm Water Utility Revenue Capital Loan Note and Interest Sinking Fund (the "Sinking Fund "). The required amount to be deposited in the Sinking Fund in any month shall be the equal monthly amount necessary to pay in full the installment of interest coming due on the next interest payment date on the then outstanding Notes and Parity Notes plus the equal monthly amount necessary to pay in full the installment of principal coming due on such Notes on the next succeeding principal payment date until the full amount of such installment is on hand. If for any reason the amount on hand in the Sinking Fund exceeds the required amount, the excess shall forthwith be withdrawn and paid into the Revenue Fund. Money in the Sinking Fund shall be used solely for the purpose of paying principal of and interest on the Notes and Parity Notes as the same shall become due and payable. (c) Subordinate Obligations. Money in the Revenue Fund may next be used to pay principal of and interest on (including reasonable reserves therefor) any other obligations which by their terms shall be payable from the revenues of the System, but subordinate to the Notes and Parity Notes, and which have been issued for the purposes of extensions and improvements to the System or to retire the Notes or Parity Notes in advance of maturity, or to pay for extraordinary repairs or replacements to the System. (d) Surplus Revenue. All money thereafter remaining in the Revenue Fund at the close of each month may be deposited in any of the funds created by this Resolution, may be used to pay for extraordinary repairs or replacements to the System, or may be used to pay or redeem the Notes or Parity Notes any of them, or for any lawful purpose. Money in the Revenue Fund shall be allotted and paid into the various funds and accounts hereinbefore referred to in the order in which said funds are listed, on a cumulative basis on the 1 Oth day of each month, or on the next succeeding business day 22 when the 10th shall not be a business day; and if in any month the money in the Revenue Fund shall be insufficient to deposit or transfer the required amount in any of said funds or accounts, the deficiency shall be made up in the following month or months after payments into all funds and accounts enjoying a prior claim to the revenues shall have been met in full. Section 18. Outstanding Obligations. The provisions in the Prior Note Resolutions, whereby there was created and is to be maintained a Storm Water Utility Revenue Note Principal and Interest Sinking Fund ( "Sinking Fund "), and for the monthly payment into said fund from the future Net Revenues of the System such portion thereof as will be sufficient to meet the principal and interest of the Outstanding Obligations, and maintaining a reserve therefor, are hereby ratified and confirmed, and all such provisions inure to and constitute the security for the payment of the principal and interest on Notes hereby authorized to be issued; provided, however, that the amounts to be set aside and paid into the Sinking Fund in equal monthly installments from the earnings shall be sufficient to pay the principal and interest due each year, not only on the Outstanding Obligations, but also the principal and interest of the Notes herein authorized to be issued. Except as may be otherwise provided in the above Prior Note Resolutions, proceeds of the Notes or other funds may be invested in Permitted Investments. Nothing in this Resolution shall be construed to impair the rights vested in the Outstanding Obligations. The amounts herein required to be paid into the various funds named in this Section shall be inclusive of payments required in respect to the Outstanding Obligations. The provisions of the legislation authorizing the Outstanding Obligations and the provisions of this Resolution are to be construed wherever possible so that the same will not be, in conflict. In the event such construction is not possible, the provisions of the resolution first adopted shall prevail until such time as the notes or bonds authorized by said resolution have been paid in full or otherwise satisfied as therein provided at which time the provisions of this Resolution shall again prevail. Section 19. Investments. Moneys on hand in the Project Fund and all of the funds provided by this Resolution may be invested only in Permitted Investments or deposited in financial institutions which are members of the Federal Deposit Insurance Corporation, or its equivalent successor, and the deposits of which are insured thereby and all such deposits exceeding the maximum amount insured from time to time by FDIC or its equivalent successor in any one financial institution shall be continuously secured in compliance with the State Sinking Fund provided under Iowa Code chapter 12C, or otherwise by a valid pledge of direct obligations of the United States Government having an equivalent market value. All investments shall mature before the date on which the moneys are required for the purposes for which the fund was created or otherwise as 23 herein provided. The provisions of this Section shall not be construed to require the Issuer to maintain separate accounts for the funds created by this Section. All income derived from such investments shall be deposited in the Revenue Fund and shall be regarded as revenues of the System except earnings on investments of the Project Fund shall be deposited in and expended from the Project Fund. Investments shall at any time necessary be liquidated and the proceeds thereof applied to the purpose for which the respective fund was created. Section 20. Covenants Regarding the Operation of the System. The Issuer hereby covenants and agrees with each and every holder of the Notes and Parity Notes: (a) Maintenance and Efficiency. The Issuer will maintain the System in good condition and operate it in an efficient manner and at reasonable cost. (b) Sufficiency of Rates. On or before the beginning of each Fiscal Year the Governing Body will adopt or continue in effect rates for all services rendered by the System determined to be sufficient to produce Net Revenues for the next succeeding Fiscal Year adequate to pay principal and interest requirements and create reserves as provided in this Resolution but not less than 110% percent of the principal and interest requirements of the Fiscal Year. No free use of the System by the Issuer or any department, agency or instrumentality of the Issuer shall be permitted except upon the determination of the Governing Body that the rates and changes otherwise in effect are sufficient to provide Net Revenues at least equal to the requirements of this subsection. (c) Insurance. The Issuer shall maintain insurance for the benefit of the noteholders on the insurable portions of the System of a kind and in an amount which normally would be carried by private companies engaged in a similar kind of business. The proceeds of any insurance, except public liability insurance, shall be used to repair or replace the part or parts of the System damaged or destroyed. (d) Accounting and Audits. The Issuer will cause to be kept proper books and accounts adapted to the System and in accordance with generally accepted accounting practices, and will diligently act to cause the books and accounts to be audited annually and reported upon not later than 180 days after the end of each Fiscal Year by an Independent Auditor and will provide copies of the audit report to the holders of any of the Notes and Parity Notes upon request. The holders of any of the Notes and Parity Notes shall have at all reasonable times the right to inspect the System and the records, accounts and data of the Issuer relating thereto. 24 (e) State Laws. The Issuer will faithfully and punctually perform all duties with reference to the System required by the Constitution and laws of the State of Iowa, including the making and collecting of reasonable and sufficient rates for services rendered by the System as above provided, and will segregate the revenues of the System and apply said revenues to the funds specified in this Resolution. (f) Property. The Issuer will not sell, lease, mortgage or in any manner dispose of the System, or any capital part thereof, including any and all extensions and additions that may be made thereto, until satisfaction and discharge of all of the Notes and Parity Notes shall have been provided for in the manner provided in this Resolution; provided, however, that this covenant shall not be construed to prevent the disposal by the. Issuer of property which in the judgment of its Governing Body has become inexpedient or unprofitable to use in connection with the System, or if it is to the advantage of the System that other property of equal or higher value be substituted therefor, and provided further that the proceeds of the disposition of such property shall be placed in a revolving fund and used in preference to other sources for capital improvements to the System. Any such proceeds of the disposition of property acquired with the proceeds of the Notes or Parity Notes shall not be used to pay principal or interest on the Notes and Parity Notes or for payments into the Sinking Funds. (g) Fidelity Note. The Issuer shall maintain fidelity note coverage in amounts which normally would be carried by private companies engaged in a similar kind of business on each officer or employee having custody of funds of the System. (h) Budget. The Governing Body of the Issuer shall approve and conduct operations pursuant to a system budget of revenues and current expenses for each Fiscal Year. Such budget shall take into account revenues and current expenses during the current and last preceding Fiscal Years. Copies of such budget and any amendments thereto shall be provided to the holders of any of the Notes upon request. Section 21. Remedies of Noteholders. Except as herein expressly limited the holder or holders of the Notes and Parity Notes shall have and possess all the rights of action and remedies afforded by the common law, the Constitution and statutes of the State of Iowa, and of the United States of America, for the enforcement of payment of their Notes and interest thereon, and of the pledge of the revenues made hereunder, and of all covenants of the Issuer hereunder. 25 Section 22. Prior Lien and Parity Notes. The Issuer will issue no other Notes or obligations of any kind or nature payable from or enjoying a lien or claim on the property or revenues of the System having priority over the Notes or Parity Notes. Additional Notes may be issued on a parity and equality of rank with the Notes with respect to the lien and claim of such Additional Notes to the revenues of the System and the money on deposit in the funds adopted by this Resolution, for the following purposes and under the following conditions, but not otherwise: (a) For the purpose of refunding any of the Notes or Parity Notes which shall have matured or which shall mature not later than three months after the date of delivery of such refunding Notes and for the payment of which there shall be insufficient money in the Sinking Fund; (b) For the purpose of refunding any Notes, Parity Notes or general obligation notes outstanding, or making extensions, additions, improvements or replacements to the System, if all of the following conditions shall have been met: (i) before any such Additional Notes ranking on a parity are issued, there will have been procured and filed with the Clerk, a statement of an Independent Auditor not a regular employee of the Issuer, reciting the opinion based upon necessary investigations that the Net Revenues of the System for the preceding Fiscal Year (with adjustments as hereinafter provided) were equal to at least 1.10 times the maximum amount that will be required in any Fiscal Year prior to the longest maturity of any of the Notes or Parity Notes for both principal of and interest on all Notes or Parity Notes then outstanding which are payable from the net earnings of the System and the Additional Notes then proposed to be issued. For the purpose of determining the Net Revenues of the System for the preceding Fiscal Year as aforesaid, the amount of the gross revenues for such year may be adjusted by an Independent Auditor, not a regular employee of the Issuer, so as to reflect any changes in the amount of such revenues which would have resulted had any revision of the schedule of rates or charges imposed at or prior to the time of the issuance of any such Additional Notes been in effect during all of such preceding Fiscal Year. (ii) the Additional Notes must be payable as to principal and as to interest on the same month and day as the Notes herein authorized. 26 (iii) for the purposes of this Section, principal and interest falling due on the first day of a Fiscal Year shall be deemed a requirement of the immediately preceding Fiscal Year. (iv) for the purposes of this Section, general obligation capital loan notes shall be refunded only upon a finding of necessity by the Governing Body and only to the extent the general obligation capital loan notes were issued or the proceeds of them were expended for the System. (v) for purposes of this Section, "preceding Fiscal Year" shall be the most recently completed Fiscal Year for which audited financial statements prepared by a certified public accountant are issued and available, but in no event a Fiscal Year which ended more than eighteen months prior to the date of issuance of the Additional Notes. Section 23. Discharge and Satisfaction of Notes. The covenants, liens and pledges entered into, created or imposed pursuant to this Resolution may be fully discharged and satisfied with respect to the Notes and Parity Notes, or any of them, in any one or more of the following ways: (a) By paying the Notes or Parity Notes when the same shall become due and payable; and (b) By depositing in trust with the Treasurer, or with a corporate trustee designated by the Governing Body for the payment of said obligations and irrevocably appropriated exclusively to that purpose an amount in cash or direct obligations of the United States the maturities and income of which shall be sufficient to retire at maturity, or by redemption prior to maturity on a designated date upon which said obligations may be redeemed, all of such obligations outstanding at the time, together with the interest thereon to maturity or to the designated redemption date, premiums thereon, if any that may be payable on the redemption of the same; provided that proper notice of redemption of all such obligations to be redeemed shall have been previously published or provisions shall have been made for such publication. Upon such payment or deposit of money or securities, or both, in the amount and manner provided by this Section, all liability of the Issuer with respect to the Notes or Parity Notes shall cease, determine and be completely discharged, and the holders thereof shall be entitled only to payment out of the money or securities so deposited. 27 Section 24. Resolution a Contract. The provisions of this Resolution shall constitute a contract between the Issuer and the holder or holders of the Notes and Parity Notes, and after the issuance of any of the Notes no change, variation or alteration of any kind in the provisions of this Resolution shall be made in any manner, except as provided in the next succeeding Section, until such time as all of the Notes and Parity Notes, and interest due thereon, shall have been satisfied and discharged as provided in this Resolution. Section 25. Amendment of Resolution Without Consent. The Issuer may, without the consent of or notice to any of the holders of the Notes and Parity Notes, amend or supplement this Resolution for any one or more of the following purposes: (a) to cure any ambiguity, defect, omission or inconsistent provision in this Resolution or in the Notes or Parity Notes; or to comply with any application provision of law or regulation of federal or state agencies; provided, however, that such action shall not materially adversely affect the interests of the holders of the Notes or Parity Notes; (b) to change the terms or provisions of this Resolution to the extent necessary to prevent the interest on the Notes or Parity Notes from being includable within the gross income of the holders thereof for federal income tax purposes; (c) to grant to or confer upon the holders of the Notes or Parity Notes any additional rights, remedies, powers or authority that may lawfully be granted to or conferred upon the holders of the Notes; (d) to add to the covenants and agreements of the Issuer contained in this Resolution other covenants and agreements of, or conditions or restrictions upon, the Issuer or to surrender or eliminate any right or power reserved to or conferred upon the Issuer in this Resolution; or (e) to subject to the lien and pledge of this Resolution additional pledged revenues as may be permitted by law. Section 26. Amendment of Resolution Requiring Consent. This Resolution may be amended from time to time if such amendment shall have been consented to by holders of not less than two- thirds in principal amount of the Notes and Parity Notes at any time outstanding (not including in any case any Notes which may then be held or owned by or for the account of the Issuer, but including such Refunding Notes as may have been issued for the purpose of refunding any of such Notes if such Refunding Notes shall not then be owned by the Issuer); but this Resolution may not be so amended in such manner as to: 28 (a) Make any change in the maturity or interest rate of the Notes, or modify the terms of payment of principal of or interest on the Notes or any of them or impose any conditions with respect to such payment; (b) Materially affect the rights of the holders of less than all of the Notes and Parity Notes then outstanding; and (c) Reduce the percentage of the principal amount of Notes, the consent of the holders of which is required to effect a further amendment. Whenever the Issuer shall propose to amend this Resolution under the provisions of this Section, it shall cause notice of the proposed amendment to be filed with the Original Purchaser and to be mailed by certified mail to each registered owner of any Notes as shown by the records of the Registrar. Such notice shall set forth the nature of the proposed amendment and shall state that a copy of the proposed amendatory Resolution is on file in the office of the City Clerk. Whenever at any time within one year from the date of the mailing of said notice there shall be filed with the City Clerk an instrument or instruments executed by the holders of at least two - thirds in aggregate principal amount of the Notes then outstanding as in this Section defined, which instrument or instruments shall refer to the proposed amendatory Resolution described in said notice and shall specifically consent to and approve the adoption thereof, thereupon, but not otherwise, the Governing Body of the Issuer may adopt such amendatory Resolution and such Resolution shall become effective and binding upon the holders of all of the Notes and Parity Notes. Any consent given by the holder of a Note pursuant to the provisions of this Section shall be irrevocable for a period of six months from the date of the instrument evidencing such consent and shall be conclusive and binding upon all future holders of the same Note during such period. Such consent may be revoked at any time after six months from the date of such instrument by the holder who gave such consent or by a successor in title by filing notice of such revocation with the City Clerk. The fact and date of the execution of any instrument under the provisions of this Section may be proved by the certificate of any officer in any jurisdiction who by the laws thereof is authorized to take acknowledgments of deeds within such jurisdiction that the person signing such instrument acknowledged before him the execution thereof, or may be proved by an affidavit of a witness to such execution sworn to before such officer. 29 The amount and numbers of the Notes held by any person executing such instrument and the date of his holding the same may be proved by an affidavit by such person or by a certificate executed by an officer of a bank or trust company showing that on the date therein mentioned such person had on deposit with such bank or trust company the Notes described in such certificate. Notwithstanding anything in this Section to the contrary, the holder or holders of 100% of the Notes and Parity Obligations may consent to any amendment of this Resolution, or waive any notices required hereunder, on such terms and under such conditions as said holders shall determine to be appropriate. Section 27. Severability. If any section, paragraph, or provision of this Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions. Section 28. Repeal of Conflicting Ordinances or Resolutions and Effective Date. All other ordinances, resolutions and orders, or parts thereof, in conflict with the provisions of this Resolution are, to the extent of such conflict, hereby repealed; and this Resolution shall be in effect from and after its adoption. Section 29. Rule of Construction. This Resolution and the terms and conditions of the Notes authorized hereby shall be construed whenever possible so as not to conflict with the terms and conditions of the Loan and Disbursement Agreement. In the event such construction is not possible, or in the event of any conflict or inconsistency between the terms hereof and those of the Loan and Disbursement Agreement, the terms of the Loan and Disbursement Agreement shall prevail and be given effect to the extent necessary to resolve any such conflict or inconsistency. 30 PASSED AND APPROVED this 17th day of February, 2014. ATTEST: 31 CERTIFICATE STATE OF IOWA ) SS COUNTY OF DUBUQUE I, the undersigned City Clerk of Dubuque, Iowa, do hereby certify that attached is a true and complete copy of the portion of the corporate records of said Municipality showing proceedings of the Council, and the same is a true and complete copy of the action taken by said Council with respect to said 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 said 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 said 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 said 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 said Municipality hereto affixed this 18th day of February, 2014. City lerk, Dubuque, SEAL 00996460 -1 \ 10422 -149 ROLL CALL ORDER FOR MEETING OF 2/17/2014 Resnick, Sutton, Braig, Buol, Connors, Jones, Lynch CITY OF DUBUQUE, IOWA CITY COUNCIL MEETING Historic Federal Building 350 W. 6th Street February 17, 2014 Council meetings are video streamed live and archived at www.citvofdubuque.orci /media and on Dubuque's City Channel on the Mediacom cable system at Channel 8 (analog) and 85.2 (digital). WORK SESSION 5:00 PM Environmental Stewardship Advisory Commission - Hydraulic Fracturing Report ESAC Hydraulic Fracturing Report Appendix 1- Public Comments, Appendix 2- EPA Progress Report, Appendix 3- List of Articles & Websites, Petition from the Sisters of the- Presentation 2/14/14 REGULAR SESSION 6:30 PM PLEDGE OF ALLEGIANCE PROCLAMATION(S) 1. Problem Gambling Awareness Month (March 2014) Problem Gambling Awareness Proclamation PRESENTATION(S) 1. Environmental Protection Agency (EPA) Smart Growth Award Assistant City Manager Teri Goodmann to present the EPA Smart Growth Achievement Award - Corridor or Neighborhood Revitalization category for the Historic Millwork District and Washington Neighborhood EPA Congratulatory Letter IEDA Congratulatory Letter Changed CONSENT ITEMS The consent agenda items are considered to be routine and non - controversial and all consent items will be normally voted upon in a single motion without any separate discussion on a particular item. If you would like to discuss one of the Consent Items, please go to the microphone and be recognized by the Mayor and state the item you would like removed from the Consent Agenda for separate discussion and consideration. 1. Minutes and Reports Submitted Arts and Cultural Affairs Advisory Commission of 12/17/13; City Council proceedings of 2/3, 2/10; Civic Center Advisory Commission of 1/27; Historic Preservation Commission of 1/16; Historic Preservation Education Task Force of 2/6; Investment Oversight Advisory Commission of 1/22; Library Board of Trustees of 12/19/13; Long Range Planning Advisory Commission of 1/15; Zoning Advisory Commission of 2/5; Proof of Publication for City Council proceedings of 1/21; Proof of Publication for List of Claims /Summary of Revenues for month ended 12/31/13 Suggested Disposition: Receive and File Arts Commission 12/17/13 Council Proceedings 2/3 Council Proceedings 2/10 Council Proceedings 2/12 Civic Center 1/27 Historic Preservation 1/16 Historic Preservation ETF 2/6 Investment Oversight 1/22 Library Board 12/19/13 Long Range Planning 1/15 Zoning Advisory 2/5 Proof - Council Proceedings 2/3 Proof - List of Claims /Revenues 12/31/13 2. Notice of Claims and Suits Scott Duehr for vehicle damage, Zachary Gries for property damage, Jerry Grutz for property damage, Kischel Harris for personal injury and property damage (2), Jeffrey Herbst for vehicle damage, Mary Heister /State Farm Mutual for vehicle damage, Mark Matel for vehicle damage, Jason McCann for vehicle damage, James Pancratz for vehicle damage, Michael Pancratz for vehicle damage, Ann Powell for vehicle damage, James Thill for vehicle damage; Jeff Tracy for vehicle damage Suggested Disposition: Receive and File; Refer to City Attorney Pg. 1 LOAN AND DISBURSEMENT AGREEMENT $1,029,000 STORM WATER UTILITY REVENUE CAPITAL LOAN NOTES This Loan and Disbursement Agreement (the "Agreement ") is made and entered into as of , 2014, by and between the City of Dubuque, Iowa (the "Participant ") and the Iowa Finance Authority, an agency and public instrumentality of the State of Iowa (the "Issuer "). WHEREAS, the Issuer, in cooperation with the Iowa Department of Natural Resources (the "Department "), is authorized to undertake the creation, administration and financing of the Iowa Water Pollution Control Works Financing Program (the "Program ") established in Iowa Code Sections 455B.291 through 455B.299, including, among other things, the making of loans to Iowa municipalities for purposes of the Program; and WHEREAS, the Participant desires to participate in the Program as a means of financing all or part of the construction of certain wastewater treatment facilities serving the Participant and its residents; and WHEREAS, to assist in financing the Project (defined herein), the Issuer desires to make a loan to the Participant in the amount set forth in Section 2 hereof; NOW, THEREFORE, the parties agree as follows: Section 1. Definitions. In addition to other definitions set forth herein, the following terms as used in this Agreement shall, unless the context clearly requires otherwise, have the following meanings: (a) "Bonds shall mean any Iowa State Revolving Fund Revenue Bonds that were or in the future are issued by the Issuer for the purpose of providing moneys to finance the Loan to the Participant. (b) "Code' shall mean the Internal Revenue Code of 1986, as amended, and all lawfully promulgated regulations thereunder. (c) "Project" shall mean the particular construction activities approved by the Department and being undertaken by the Participant with respect to its Wastewater Treatment System, as described in the Resolution. (d) "Regulations" shall mean the administrative rules of the Department . relating to the Program, set forth in Title 567, Chapter 92 of the Iowa Administrative Code, and the administrative rules of the Issuer relating to the Program set forth in Title 265, Chapter 26 of the Iowa Administrative Code. (e) "Resolution" shall mean the resolution of the Council of the Participant, adopted on February , 2014, approving and authorizing the execution of this Agreement and the issuance of the Revenue Bond (defined herein). (f) "Wastewater Treatment System" shall mean the wastewater treatment system of the Participant, all facilities being used in conjunction therewith and all appurtenances and extensions thereto, including but not limited to the wastewater treatment system project which the Participant is financing under this Agreement. Section 2. Loan; Purchase of Revenue Bond. The Issuer agrees to purchase a duly authorized and issued sewer revenue bond or capital loan note of the Participant (the "Revenue Bond ") in order to make a loan to the Participant, and will disburse proceeds as set forth herein. The Participant agrees to borrow and accept from the Issuer, a loan in the principal amount of $1,029,000 (the "Loan "). The Participant shall use the proceeds of the Loan strictly (a) to finance a portion of the costs of construction of the Project and (b), where applicable, to reimburse the Participant for a portion of the costs of the Project, which portion was paid or incurred in anticipation of reimbursement through the Program and which is eligible for such reimbursement under and pursuant to the Regulations and the Code. Section 3. Disbursements. Proceeds of the Loan shall be made available to the Participant in the form of one or more periodic disbursements as provided in this Section. Prior to requesting any such disbursement, the Participant shall provide the Issuer with a copy of each contract for construction or services relating to the Project. The Issuer thereafter shall make disbursements from the account designated by the Issuer of a portion of the Loan for payment of costs of the Project upon receipt of the following: (a) a completed payment request on a form acceptable to and available from the Issuer; (b) current construction payment estimates; (c) engineering service statements; (d) purchase orders or invoices for items not included within other contracts; and (e) evidence that the costs for which the disbursement is requested have been incurred. Solely with respect to the request for the final disbursement of proceeds of the Loan, the Participant shall submit to the Issuer, in addition to items (a) through (e) above, a certification of completion and acceptance of the Project by the Participant or evidence of an acceptable settlement if the Project is subject to a dispute between the Participant and any contractor. Disbursements shall be made in a timely fashion following the receipt of the information as set forth above. Funds shall be payable to the Participant at the address specified in the disbursement request in the form of a check, wire transfer or automated clearinghouse system transfer, as requested by the Participant. 2 Section 4. Completion of Project. The Participant covenants and agrees (i) to exercise its best efforts in accordance with prudent wastewater treatment utility practices to complete the Project; and (ii) to provide from its own fiscal resources all monies, in excess of the total amount of Loan proceeds it receives under the Agreement, required to complete the Project. Section 5. Repayment of Loan; Issuance of Revenue Bonds. The Participant's obligation to repay the Loan and interest thereon shall be evidenced by the Revenue Bond in the principal amount of the Loan, complying in all material respects with the Regulations and being in substantially the form set forth in the Resolution. The Revenue Bond shall be delivered to the Issuer as the original purchaser and registered holder thereof at the closing of the Loan. The Revenue Bond shall be accompanied by a legal opinion of bond counsel, in form satisfactory to the Issuer, to evidence the legality, security position and tax - exempt status of interest on the Revenue Bond. The parties agree that a payment of principal of or interest on the Revenue Bond shall be deemed to be a payment of the same on the Loan and a payment of principal of or interest on the Loan shall be deemed to be a payment of the same on the Revenue Bond. The Revenue Bond shall be dated the date of delivery to the Issuer, shall bear interest at the rate of 1.75% per annum payable semiannually on June 1 and December 1 of each year (unless the resolution authorizing a previous series of outstanding bonds on a parity with the Revenue Bond requires interest to be paid on other interest payment dates, in which case such other dates shall apply) from the date of each advancement of a part of the Loan from the Issuer to the Participant (which are initially expected to be on approximately the dates set forth on Exhibit A attached hereto and incorporated herein). The first repayment of principal of the Loan shall be due and payable not later than one year after completion of the Project and payments of principal and interest shall continue thereafter until paid in full as to principal and interest as set forth in Exhibit A attached hereto and incorporated herein. Following the final disbursement of Loan proceeds to the Participant, Exhibit A shall be adjusted by the Issuer, with the approval of the Participant, based upon actual advancements to the Participant under the Agreement and final costs of the Project (adjusted to a multiple of $1,000). Such revised Exhibit A thereafter shall be deemed to be incorporated herein by reference and made a part hereof and shall supersede and replace that initially attached hereto and to the Revenue Bond. The Revenue Bond shall be subject to optional redemption by the Participant at a price of par plus accrued interest (i) on any date upon receipt of written consent by the Issuer, or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of the Revenue Bond by the Participant may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity upon not less than thirty (30) days notice of redemption by certified or registered mail to the Issuer (or any other registered owner of the Revenue Bond). The Revenue Bond is also subject to mandatory redemption in the event the costs of the Project are less than initially projected, in which case the amount of the Loan shall be reduced to an amount equal to the actual Project costs advanced (which amount shall in any event be adjusted to a multiple of $1,000). The Participant and the Issuer agree that following such adjustment, the principal amount due under the Revenue Bond shall be automatically reduced to equal the principal amount of the adjusted Loan. 3 The Revenue Bond and the interest thereon and any additional obligations as may be hereafter issued and outstanding from time to time under the conditions set forth in the Resolution shall be payable solely and only from the Net Revenues (as defined in the Resolution) of the Wastewater Treatment System of the Participant, a sufficient portion of which has been and shall be ordered set aside and pledged for such purpose under the provisions of the Resolution. Neither this Agreement nor the Revenue Bond is a general obligation of the Participant, and under no circumstance shall the Participant be in any manner liable by reason of the failure of the aforesaid Net Revenues to be sufficient to pay the Revenue Bond and the interest thereon or to otherwise discharge the Participant's obligation hereunder. Section 6. Initiation and Servicing Fees. The Participant agrees to pay to the Issuer, as additional consideration for the Loan, a loan initiation fee (the "Initiation Fee ") equal to one - half of one percent (0.5 %) of the amount of the Loan ($5,145), which shall be due and payable on the date of this Agreement. Unless the Issuer shall be otherwise notified by the Participant that the Participant intends to pay such Initiation Fee from other funds, and has received such other funds from the Participant on the date hereof, the Issuer shall be authorized to deduct the full amount of the Initiation Fee from the proceeds of the Loan being made hereunder, and such deduction by the Issuer shall be deemed to be an expenditure by the Participant of the Loan proceeds. In addition, the Participant agrees to pay an annual Loan servicing fee (the "Servicing Fee ") to the Issuer equal to 0.25 percent per annum of the principal amount of the Loan outstanding (including Loan proceeds which have not yet been disbursed) on June 1 of each year (or on such other date that the annual principal payment is due under the Revenue Bond), which Servicing Fee shall be invoiced to the Participant by the Issuer as of said dates as the same shall become due and payable. Section 7. Compliance with Applicable Laws, Performance Under Loan Agreement; Rates. The Participant covenants and agrees (i) to comply with all applicable State of Iowa and federal laws, rules and regulations (including but not limited to the Regulations), judicial decisions, and executive orders in the performance of the Agreement and in the financing, construction, operation, maintenance and use of the Project and the Wastewater Treatment System; (ii) to maintain its Wastewater Treatment System in good repair, working order and operating condition; (iii) to cooperate with the Issuer in the observance and performance of their respective duties, covenants, obligations and agreements under the Agreement; (iv) to comply with all terms and conditions of the Resolution; and (v) to establish, levy and collect rents, rates and other charges for the products and services provided by its Wastewater Treatment System, which rents, rates and other charges shall be at least sufficient (A) to meet the operation and maintenance expenses of such Wastewater Treatment System, (B) to produce and maintain Net Revenues at a level not less than 110% of the amount of principal and interest on the Revenue Bond and any other obligations secured by a pledge of the Net Revenues falling due in the same year, (C) to comply with all covenants pertaining thereto contained in, and all other provisions of any bond resolution, trust indenture or other security agreement, if any, relating to any bonds or other evidences of indebtedness issued or to be issued by the Participant, (D) to pay the debt service requirements on any bonds, notes or other evidences of indebtedness, whether now outstanding or incurred in the future, secured by such revenues or other receipts and issued to finance improvements to the Wastewater Treatment System and to make any other payments -4- required by the laws of the State of Iowa, (E) to generate funds sufficient to fulfill the terms of all other contracts and agreements made by the Participant, including, without limitation, the Agreement and the Revenue Bond and (F) to pay all other amounts payable from or constituting a lien or charge on the operating revenues of its Wastewater Treatment System. Section 8. Exclusion of Interest from Gross Income. Unless otherwise agreed to by the Issuer in writing, the Participant covenants and agrees as follows: (a) The Participant shall not take any action or omit to take any action which would result in a loss of the exclusion of the interest on the Bonds from gross income for federal income taxation as that status is governed by Section 103(a) of the Code. (b) The Participant shall not take any action or omit to take any action, which action or omission would cause its Revenue Bond or the Bonds (assuming solely for this purpose that the proceeds of the Bonds loaned to the Participant represent all of the proceeds of the Bonds) to be "private activity bonds" within the meaning of Section 141(a) of the Code. Accordingly, unless the Participant receives the prior written approval of the Issuer, the Participant shall not (A) permit any of the proceeds of the Bonds loaned to the Participant or the Project financed with such proceeds to be used, either directly or indirectly, in any manner that would constitute "private business use" within the meaning of Section 141(b)(6) of the Code, taking into account for this purpose all such use by persons other than governmental units on an aggregate basis, (B) use, either directly or indirectly, any of the proceeds of the Bonds loaned to the Participant to make or finance loans to persons other than governmental units (as such term is used in Section 141(c) of the Code) or (C) use, either directly or indirectly, any of the proceeds of the Bonds loaned to the Participant to acquire any "non - governmental output property" within the meaning of Section 141(d)(2) of the Code. (c) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds (or amounts replaced with such proceeds) or any other funds or take any action or omit to take any action, which use or action or omission would (assuming solely for this purpose that the proceeds of the Bonds loaned to the Participant represent all of the proceeds of the Bonds) cause the Bonds to be "arbitrage bonds" within the meaning of Section 148(a) of the Code. (d) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds to pay the principal of or interest on any issue of State or local governmental obligations ( "refinancing of indebtedness ") unless the Participant shall establish to the satisfaction of the Issuer that such refinancing of indebtedness will not adversely affect the exclusion from gross income of interest on the Bonds for federal income tax purposes and the Participant delivers an opinion to such effect of bond counsel acceptable to the Issuer. (e) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds to reimburse the Participant for any portion of the cost of the 5 Project unless such cost was paid and incurred by the Participant in anticipation of reimbursement from the proceeds of the Bonds or other State or local governmental borrowing in accordance with the Code, published rulings of the Internal Revenue Service and the Regulations. (f) The Participant shall not use the proceeds of the Bonds (assuming solely for this purpose that the proceeds of the Bonds loaned to the Participant represent all of the proceeds of the Bonds) in any manner which would cause the Bonds to be "federally guaranteed" within the meaning of Section 149(b) of the Code or "hedge bonds" within the meaning of Section 149(g) of the Code. (g) The Participant shall comply with all provisions of the Code relating to the rebate of any profits from arbitrage attributable to the Participant, and shall indemnify and hold the Issuer harmless therefrom. Section 9. Insurance; Audits; Disposal of Property. The Participant covenants and agrees (a) to maintain insurance on, or to self - insure, the insurable portions of the Wastewater Treatment System of a kind and in an amount which normally would be carried by private companies engaged in a similar type of business, (b) to keep proper books and accounts adapted to the Wastewater Treatment System, showing the complete and correct entry of all transactions relating thereto, and to cause said books and accounts to be audited by an independent auditor or the State Auditor (i) for the year in which the Project is placed in service and commences• operations, (ii) at such times and for such periods as may be required by the federal Single Audit Act of 1984, OMB Circular A -133 or State law, and (iii) at such other times and for such other periods as may be requested at any time and from time to time by the Issuer (which requests may require an audit to be performed for a period that would not otherwise be required to be audited under State law), and (c) not to sell, lease or in any manner dispose of the Wastewater Treatment System, or any capital part thereof, including any and all extensions and additions which may be made thereto, until the Revenue Bond shall have been paid in full or otherwise discharged as provided in the Resolution; provided, however, that the Participant may dispose of any property which in the judgment of its governing body is no longer useful or profitable to use in connection with the operation of the Wastewater Treatment System or essential to the continued operation thereof. Section 10. Maintenance of Documents; Access. The Participant agrees to maintain separate financial records, in accordance with generally accepted government accounting standards for construction cost accounting, operating revenue of the Wastewater Treatment System and Loan repayments. The Participant agrees to permit the Issuer or its duly authorized representative access to all files and documents relating to the Project for purposes of conducting audits and reviews in accordance with any of the Regulations. Section 11. Continuing Disclosure. As a means of enabling the Issuer to comply with the "continuing disclosure" requirements set forth in Rule 15c2 -12 (the "Rule ") of the Securities 6 and Exchange Commission, the Participant agrees, during the term of the Loan, to provide the Issuer with (i) the comprehensive audit report of the Participant, prepared and certified by an independent auditor or the State Auditor not later than 180 days after the end of each fiscal year for which the report was prepared and (ii) such other information and operating data as the Issuer may reasonably request from time to time with respect to the Wastewater Treatment System, the Project or the Participant. The Participant hereby consents to the inclusion of all or any portion of the foregoing information and materials in a public filing made by the Issuer under the Rule. The Participant agrees to indemnify and hold harmless the Issuer, and its officers, directors, employees and agents from and against any and all claims, damages, losses, liabilities, reasonable costs and expenses whatsoever (including attorney fees) which such indemnified party may incur by reason of or in connection with the disclosure of information permitted under this Section; provided that no such indemnification shall be required for any claims, damages, losses, liabilities, costs or expenses to the extent, but only to the extent, caused by the willful misconduct or gross negligence of the Issuer in the disclosure of such information. Section 12. Events of Default. If any one or more of the following events occur, it is hereby defined as and declared to constitute an "Event of Default" under this Agreement: (a) Failure by the Participant to pay, or cause to be paid, any Loan repayment required to be paid under this Agreement when due, which failure shall continue for a period of five (5) days. (b) Failure by the Participant to make, or cause to be made, any required payments of principal, redemption premium, if any, and interest on any bonds, notes or other obligations of the Participant (other than the Loan and the Revenue Bond), the payment of which are secured by operating revenues of the Wastewater Treatment System. (c) Failure by the Participant to pay, or cause to be paid, the Servicing Fee or any portion thereof when due, or to observe and perform any duty, covenant, obligation or agreement on its part to be observed or performed under the Agreement or the Resolution, other than the obligation to make Loan repayments, which failure shall continue for a period of thirty (30) days after written notice, specifying such failure and requesting that it be remedied, is given to the Participant by the Issuer, unless the Issuer shall agree in writing to an extension of such time prior to its expiration or the failure stated in such notice is correctable but cannot be corrected in the applicable period, in which case the Issuer may not unreasonably withhold its consent to an extension of such time up to one hundred twenty (120) days from the delivery of the written notice referred to above if corrective action is commenced by the Participant within the applicable period and diligently pursued until the Event of Default is corrected. Section 13. Remedies on Default. Whenever an Event of Default shall have occurred and be continuing, the Issuer shall have the right to take any action authorized under the 7 Regulations, the Revenue Bond or this Agreement and to take whatever other action at law or equity may appear necessary or desirable to collect the amounts then due and thereafter to become due under the Agreement or to enforce the performance and observance of any duty, covenant, obligation or agreement of the Participant under the Agreement or the Resolution. Section 14. Amendments. This Agreement may not be amended, supplemented or modified except by a writing executed by all of the parties hereto. Section 15. Termination. The Participant understands and agrees that the Loan may be terminated at the option of the Issuer if construction of the Project has not commenced within one year of the date of execution of this Agreement, all as set forth in the Regulations. Section 16. Rule of Construction. This Agreement is executed pursuant to the provisions of Section 384.24A of the Code of Iowa and shall be read and construed as conforming to all provisions and requirements of that statute. In the event of any inconsistency or conflict between the terms and conditions of the Revenue Bond and this Agreement or the Regulations, the parties acknowledge and agree that the terms of this Agreement or the Regulations, as the case may be, shall take precedence over any such terms of the Revenue Bond and shall be controlling, and that the payment of principal and interest on the Loan shall at all times conform to the schedule set forth on Exhibit A, as adjusted, and the Regulations. Section 17. Repayment of Planning and Design Loan. The Participant entered into an Interim Loan and Disbursement Agreement with the Issuer to provide funds to pay the costs of planning and designing the Project. The Participant agrees to repay the Interim Loan and Disbursement Agreement on the date of this Agreement. Unless the Participant notifies the Issuer that the Participant intends to repay the Interim Loan and Disbursement Agreement from other funds, and the Issuer has received such other funds from the Participant on the date hereof, the Issuer shall be authorized to deduct the full amount due under the Interim Loan and Disbursement Agreement from the proceeds of the Loan being made hereunder, and such deduction by the Issuer shall be deemed to be an expenditure by the Participant of the Loan proceeds. 8 IN WITNESS WHEREOF, we have hereunto affixed our signatures all as of the date first above written. CITY OF DUBUQUE, IOWA By: Mayor Attest: City Clerk (SEAL) 9 IN WITNESS WHEREOF, I have hereunto affixed my signature all as of the date first above written. IOWA FINANCE AUTHORITY By: Its: Executive Director EXHIBIT A ESTIMATED ADVANCEMENTS AND DEBT SERVICE REPAYMENT SCHEDULE 00997153 -1 \10422 -149 Loan summa Loan Closing Date Final disbursement Date Final Maturity Date Loan period in years Total Loaned Amount 0.5% Initiation Fee Net Proceeds to Borrower Annual interest rate Total interest Servicing Fee rate Total Servicing Fees Total Loan Costs Estimated Amortization Schedule City of Dubuque Taxable Revenue Bond CS- 192513 -02 ry Feb 28, 2014 Mar 28, 2014 Jun 1, 2033 20 $ 1,029,000.00 5,145.00 $ 1,023,855.00 1.75% 187,953.84 0.25% $ 26,798.20 219,897.04 Estimated Draw Schedule Initiation Fee - Feb 28, 2014 P & D Payoff - Feb 28, 2014 Estimated Draw #1- Feb 28, 2014 Estimated Draw #2- Estimated Draw #3- Estimated Draw #4- Estimated Draw #5- Estimated Draw #6- Estimated Draw #7- Estimated Draw #8- Estimated Draw #9- Estimated Draw # 10- Held for Final Docs - Mar 28, 2014 Total Loaned Amount 5,145.00 1,018,855.00 5,000.00 1,029, 000.00 STATE. EVOLVING RE/fl Payment Beginning Date Balance Principal Jun 1, 2014 1,029,000.00 41,000.00 Dec 1, 2014 988,000.00 Jun 1,,2015 988,000,00 Dec 1, 2015 945,000.00 Jun 1, 2016 945,000.00 44,000.00 Dec 1, 2016 901,000.00 Jun 1,2017 901,000.00 45,000.00 Dec 1, 2017 856,000.00 Jun 1, 2018 856,000.00 46,000.00 Dec 1, 2018 810,000.00 Jun 1, 2019 810,000.00 47,000.00 Dec 1, 2019 763,000.00 Jun 1, 2020 763,000.00 48,000 -00 Dec 1, 2020 715,000.00 Jun 1, 2021 715,000.00 Dec 1, 2021 666,000.00 Jun 1, 2022 666,000.00 50,000.00 Dec 1, 2022 616,000.00 Jun 1, 2023 616,000.00 50,000.00 Dec 1, 2023 566,000.00 Jun 1, 2024 566,000.00 52,000.00 Dec 1, 2024 514,000.00 Jun 1, 2025 514,000.00 Dec 1, 2025 461,000.00 Jun 1, 2026 461,000.00 54,000.00 Dec 1, 2026 407,000.00 Jun 1, 2027 407,000.00 55,000.00 Dec 1, 2027 352,000.00 Jun 1, 2028 352,000.00 56,000.00 Dec 1, 2028 296,000.00 Jun 1, 2029 296,000.00 57,000.00 Dec 1, 2029 239,000.00 58,000.00 Interest Servicing Fee Total Loan Total Annual Debt Ending Payment Service Balance 4,545.09 8,645.00 43,000.00 9,003.75 8,268.75 8,268.75 7,883.75 7,883.75 7,490.00 7,490.00 7,087.50 7,087.50 6,676.25 6,676.25 6,256.25 49,000.00 6,256.25 5,827.50 5,827.50 5,390.00 5,390.00 4,952.50 4,952.50 4,497.50 4,497.50 4,033.75 4,033.75 3,561.25 3,561.25 3,080.00 3,080.00 2,590.00 2,590.00 2,091.25 2,091.25 1,583.75 59,000.00 1,583.75 1,067.50 60,000.00 1,067.50 542.50 62,000.00 542.50 53,000.00 Jun 1, 2030 239,000.00 Dec 1, 2030 181,000.00 Jun 1, 2031 181,000.00 Dec 1, 2031 122,000.00 Jun 1, 2032 122,000.00 Dec 1, 2032 62,000.00 Jun 1, 2033 62,000.00 As of 1/29/2014 648.20 1,235.00 1,235.00 1,181.25 1,181.25 1,126.25 1,126.25 1,070.00 1,070.00 1,012.50 1,012.50 953.75 953.75 893.75 893.75 832.50 832.50 770.00 770.00 707.50 707.50 642.50 642.50 576.25 576.25 508.75 508.75 440.00 440.00 370.00 370.00 298.75 298.75 226.25 226.25 152.50 152.50 77.50 77.50 46 193.29 9,880.00 53 238.75 9,450.00 53,450.00 9,010.00 54,010.00 8,560.00 54,560.00 8,100.00 55,100.00 7,630.00 55,630.00 7,150.00 56,150.00 6,660.00 56,660.00 6,160.00 56,160.00 5,660.00 57,660.00 5,140.00 58,140.00 4,610.00 58,610.00 4,070.00 59,070.00 3,520.00 59,520.00 2,960.00 59,960.00 2,390.00 60,390.00 1,810.00 60 810.00 1,220.00 61,220,00 620.00 62,620.00 46,193.29 988,000.00 988,000.00 63,118.75 945 000.00 945 000.00 62,900.00 901,000.00 901,000.00 63,020.00 856,000.00 856,000.00 63,120.00 810,000.00 810,000.00 63,200.00 763,000.00 763,000.00 63,260.00 715,000.00 715,000.00 63,300.00 666,000.00 666,000.00 63,320.00 616,000.00 616,000.00 62,320.00 566,000.00 566,000.00 63,320.00 514,000.00 514,000.00 _63,280.00 461,000.00 461,000.00 63,220.00 407 000.00 407,000.00 63,140.00 352,000.00 352,000.00 63,04.0.00 296,000.00 296,000.00 62,920.00 239,000.00 239,000.00 62,780.00 181, 000.00 181,000.00 62,620.00 122,000.00 122,000.00 62,440.00 62,000.00 62,000.00 63,240.00 0.00 INVESTING IN IOWA'S WATER www.iowasrf.com REGISTERED REGISTERED CERTIFICATE NO. R -1 STATE OF IOWA $1,029,000 COUNTY OF DUBUQUE CITY OF DUBUQUE STORM WATER UTILITY REVENUE CAPITAL LOAN NOTE TAXABLE SERIES 2014A Rate 1.75% Final Maturity June 1, 2033 Note Date , 2014 The City of Dubuque, Iowa, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of Iowa (the "Issuer "), for value received, promises to pay from the source and as hereinafter provided, on the maturity date indicated above, to IOWA FINANCE AUTHORITY or registered assigns, the principal sum of ONE MILLION TWENTY NINE THOUSAND DOLLARS ($1,029,000) in lawful money of the United States of America, on the maturity dates and in the principal amounts set forth on the Debt Service Schedule attached hereto and incorporated herein by this reference, with interest on said sum from the date of each advancement made under a certain Loan and Disbursement Agreement, dated as of the date hereof until paid at the rate of 1.75% per annum, payable on June 1, 2014, and semi - annually thereafter on the 1st day of June and December in each year. As set forth on said Debt Service Schedule, principal shall be payable on June 1, 2014 and annually thereafter on the first day of June in the amounts set forth therein until principal and interest are fully paid, except that the final installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June 1, 2033. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be payable as shown on. said Debt Service Schedule until completion of the Project, at which time the final Debt Service Schedule shall be determined by the Trustee and attached hereto based upon actual advancements, final costs and completion of the Project, all as provided in the administrative rules governing the Iowa Water Pollution Control Works Financing Program. Payment of principal and interest of this Note shall at all times conform to said Debt Service Schedule and the rules of the Iowa Water Pollution Control Works Financing Program. Interest and principal shall be paid to the registered holder of the Note as shown on the records of ownership maintained by the Registrar as of the 15th day of the month next preceding such interest payment date. Interest shall be computed on the basis of a 360 -day year of twelve 30 -day months. This Note is issued pursuant to the provisions of Sections 384.24A and 384.83 of the Code of Iowa, for the purpose of paying costs of constructing storm water drainage projects and improvements, including those costs associated with the Lower Bee Branch Creek Restoration Project, and evidences amounts payable under a certain Loan and Disbursement Agreement, dated as of the date hereof, in conformity to a Resolution of the Council of said City duly passed and approved. For a complete statement of the revenues and funds from which and the conditions under which this Note is payable, a statement of the conditions under which additional notes or bonds of equal standing may be issued, and the general covenants and provisions pursuant to which this Note is issued, reference is made to the above - described Loan and Disbursement Agreement and Resolution. This Note is subject to optional redemption at a price of par plus accrued interest (i) on any date upon receipt of written consent of the Iowa Finance Authority or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of this Note may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity, by lot by giving thirty (30) days' notice of redemption by certified or registered mail, to the Iowa Finance Authority (or any other registered owner of the Note). This Note is also subject to mandatory redemption as set forth in Section 5 of the Agreement. Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the City Treasurer, Dubuque, Iowa, the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Note at the office of the Registrar, together with an assignment duly executed by the owner hereof or his duly authorized attorney in the form as shall be satisfactory to the Registrar. Issuer reserves the right to substitute the Registrar and Paying Agent but shall, however, promptly give notice to registered Noteholders of such change. All Notes shall be negotiable as provided in Article 8 of the Uniform Commercial Code and subject to the provisions for registration and transfer contained in the Note Resolution. This Note and the series of which it forms a part, other notes ranking on a parity therewith, and any additional bonds or notes which may be hereafter issued and outstanding from time to time on a parity with said Notes, as provided in the Resolution of which notice is hereby given and is hereby made a part hereof, are payable from and secured by a pledge of the Net Revenues of the Storm Water Utility (the "System "), as defined and provided in said Resolution. There has heretofore been established and the City covenants and agrees that it will maintain just and equitable rates or charges for the use of and service rendered by said System in each year for the payment of the proper and reasonable expenses of operation and maintenance of said System and for the establishment of a sufficient sinking fund to meet the principal of and interest on this series of Notes, and other notes ranking on a parity therewith, as the same become due. This Note is not payable in any manner by taxation and under no circumstances shall the City be in any manner liable by reason of the failure of said net earnings to be sufficient for the payment hereof. And it is hereby represented and certified that all acts, conditions and things requisite, according to the laws and Constitution of the State of Iowa, to exist, to be had, to be done, or to be performed precedent to the lawful issue of this Note, have been existent, had, done and performed as required by law. IN TESTIMONY WHEREOF, said City by its City Council has caused this Note to be signed by the manual signature of its Mayor and attested by the manual signature of its Clerk, with the seal of said City impressed hereon, and authenticated by the manual signature of an authorized representative of the Registrar, the City Treasurer, Dubuque, Iowa. (SEAL) CITY OF DUBUQUE, IOWA By: By: City Clerk Mayor Date of authentication: This is one of the Notes described in the within mentioned Resolution, as registered by the City Treasurer CITY TREASURER, Registrar By: Authorized Signature Registrar and Transfer Agent: City Treasurer Paying Agent: City Treasurer ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (Social Security or Tax Identification No. ) the within Note and does hereby irrevocably constitute and appoint attorney in fact to transfer the said Note on the books kept for registration of the within Note, with full power of substitution in the premises. Dated SIGNATURE ) GUARANTEED ) (Person(s) executing this Assignment sign(s) here) IMPORTANT - READ CAREFULLY The signature(s) to this Power must correspond with the name(s) as written upon the face of the certificate(s) or Note(s) in every particular without alteration or enlargement or any change whatever. Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may require signature to be guaranteed by certain eligible guarantor institutions that participate in a recognized signature guarantee program. INFORMATION REQUIRED FOR REGISTRATION OF TRANSFER Name of Transferee(s) Address of Transferee(s) Social Security or Tax Identification Number of Transferee(s) Transferee is a(n): Individual* Corporation Partnership Trust *If the Note is to be registered in the names of multiple individual owners, the names of all such owners and one address and social security number must be provided. The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common IA UNIF TRANS MIN ACT - Custodian (Cust) (Minor) under Iowa Uniform Transfers to Minors Act (State) 00997145 Loan summa Loan Closing Date Final disbursement Date Final Maturity Date Loan period in years Total Loaned Amount 0.5% Initiation Fee Net Proceeds to Borrower Annual interest rate Total interest Servicing Fee rate Total Servicing Fees Total Loan Costs Estimated Amortization Schedule City of Dubuque Taxable Revenue Bond CS- 192513 -02 ry Feb 28, 2014 Mar 28, 2014 Jun 1, 2033 20 $ 1,029,000.00 5,145.00 $ 1,023,855.00 1.75% 187,953.84 0.25% $ 26,798.20 219,897.04 Initiation Fee - P & D Payoff - Estimated Draw #1- Estimated Draw #2- Estimated Draw #3- Estimated Draw #4- Estimated Draw #5- Estimated Draw #6- Estimated Draw #7- Estimated Draw #8- Estimated Draw #9- Estimated Draw #10- Held for Final Docs - Mar 28, 2014 Total Loaned Amount Estimated Draw Schedule Feb 28, 2014 Feb 28, 2014 Feb 28, 2014 5,145.00 1, 018, 855.00 5,000.00 1,029,000.00 Payment Beginning Date Balance Principal Interest Servicing Fee Total Loan Total Annual Debt Ending Payment Service Balance Jun 1, 2014 Dec 1,2014 Jun 1,2015 Dec 1,2015 Jun 1,2016 Dec 1, 2016 Jun 1, 2017 Dec 1,2017 Jun 1, 2018 Dec 1, 2018 Jun 1,2019 Dec 1,2019 Jun 1, 2020 Dec 1, 2020 Jun 1, 2021 Dec 1, 2021 Jun 1, 2022 Dec 1, 2022 Jun 1, 2023 Dec 1, 2023 Jun 1, 2024 Dec 1, 2024 Jun 1, 2025 Dec 1, 2025 Jun 1, 2026 Dec 1, 2026 Jun 1, 2027 Dec 1, 2027 Jun 1, 2028 Dec 1, 2028 Jun 1, 2029 Dec 1, 2029 Jun 1, 2030 Dec 1, 2030 Jun 1, 2031 Dec 1, 2031 Jun 1, 2032 Dec 1, 2032 Jun 1, 2033 As of 1/29/2014 1,029,000.00 988,000.00 988,000.00 945,000.00 945,000.00 901, 000.00 901,000.00 856,000.00 856,000.00 810,000.00 810,000.00 763,000.00 763,000.00 715, 000.00 715,000.00 666,000.00 666,000.00 616,000.00 616,000.00 566,000.00 566,000.00 514,000.00 514,000.00 461, 000.00 461, 000.00 407,000.00 407,000.00 352,000.00 352,000.00 296,000.00 296,000.00 239,000.00 239,000.00 181, 000.00 181,000.00 122,000.00 122,000.00 62,000.00 62,000.00 41, 000.00 43,000.00 44,000.00 45,000.00 ._.._........ 46,000.00 47,000.00 48,000.00 49,000.00 50,000.00 50,000.00 52,000.00 53,000.00 54,000.00 55,000.00 56,000.00 57,000.00 58,000.00 59,000.00 60,000,00 62,000.00 4,545.09 8,645,00 9,003.75 8,268,75 8,268.75 7,883.75 7,883.75 7,490.00 7,490.00 7,087.50 7,087.50 6,676.25 6,676.25 6,256.25 6,256.25 5,827.50 5,827.50 5,390.00 5,390.00 4,952.50 4,952.50 4,497.50 4,497.50 4,033,75 4,033.75 3,561.25 3,561.25 3,080.00 3,080.00 2,590.00 2,590.00 2,091.25 2,091.25 1,583.75 1,583.75 1,067.50 1,067.50 542.50 542.50 648.20 1,235.00 1,235.00 1,181.25 1,181.25 1,126.25 1,126.25 1,070.00 1,070.00 1,012.50 1,012.50 953.75 953.75 893.75 893.75 832.50 832.50 770.00 770.00 707.50 707.50 642.50 642.50 576.25 576.25 508.75 508.75 440.00 440.00 370.00 370.00 298.75 298.75 226.25 226.25 152.50 152.50 77.50 77.50 46,193.29 9,880.00 53,238.75 9,450.00 53,450.00 9,010.00 54,010.00 8,560.00 54,560.00 8,100.00 55,100.00 7,630.00 55,630.00 7,150.00 56,150.00 6,660.00 56,660.00 6,160.00 56,160.00 5,660.00 57,660.00 5,140.00 58,140.00 4,610.00 58, 610.00 _.._.. .... - . 4,070.00 59,070.00 3,520.00 59,520.00 2,960.00 59,960.00 2,390.00 60,390.00 1,810.00 60,810.00 1,220.00 61,220.00 620.00 62,620.00 46,193.29 63,118.75 62,900.00 63,020.00 63,120.00 63,200.00 63,260.00 63,300.00 63,320.00 62, 320.00 63,320.00 63,280.00 63,220.00 63,140.00 63,040.00 62,920.00 62,780.00 62,620.00 62,440.00 63,240.00 988,000.00 988,000.00 945,000.00 945,000.00 901,000.00 901,000.00 856,000.00 856,000.00 810,000.00 810,000.00 763,000.00 763,000.00 715,000.00 715,000.00 666,000.00 666,000.00 616,000.00 616,000.00 566,000.00 566,000.00 514,000.00 514,000.00 461,000.00 461, 000.00 407,000.00 407,000.00 352,000.00 352,000.00 296,000.00 296,000.00 239,000.00 239,000.00 181,000.00 181, 000.00 122,000.00 122,000.00 62,000.00 62,000.00 0.00 INVESTING IN IOWA'S WATER www.iowasrf.com CLN2.SHL DELIVERY CERTIFICATE We, the undersigned City officials, do hereby certify that we are the officers, respectively below indicated, of a municipal corporation in the State of Iowa, known as the City of Dubuque, Iowa; that in pursuance of the provisions of Sections 384.24A and 384.84A, Code of Iowa, there have been heretofore lawfully authorized and this day by us lawfully executed, issued, caused to be registered and authenticated and delivered fully registered Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A, numbered R -1 in the amount of $1,029,000, of said City, dated the date of delivery, bearing interest at the rate of 1.75% per annum set forth on the Debt Service Schedule attached hereto and incorporated herein by this reference. The Notes have been executed with the manual signature of the Mayor and the manual signature of the City Clerk of said City. The Notes have been delivered to: Iowa Finance Authority of Des Moines, Iowa, and has been paid for in accordance with the terms of the contract of sale and at a price of par. We further certify that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City, or the titles of the undersigned officers to their respective positions, or the validity of the Notes, or the pledge of the net earnings of the Storm Water Utility System, (the "System"), to the payment of the Notes or the power and duty of the City to construct, own and operate its System as a revenue producing undertaking and to provide, charge and apply adequate rates and charges for the full and prompt payment of the principal and interest of the Notes, and that none of the proceedings or authority for the issuance of the Notes have been repealed, revoked, rescinded, or modified in any manner. We further certify that each of the officers whose signatures appear on the Notes were in occupancy and possession of their respective offices at the time the Notes were executed and do hereby adopt and affirm their signatures appearing in the Notes. We further certify that the present financial condition of the City is as follows: Total storm water revenue bonded indebtedness, including above - mentioned Storm Water Utility Revenue Capital Loan Notes $ All other indebtedness of any kind, payable from Storm Water Revenues $ IN WITNESS WHEREOF, we have hereunto affixed our hands at Dubuque, Iowa, this day of , 2014. Mayor City Clerk Treasurer (SEAL) 00997159 -1 \10422 -149 Loan summa Loan Closing Date Final disbursement Date Final Maturity Date Loan period in years Total Loaned Amount 0.5% Initiation Fee Net Proceeds to Borrower Annual interest rate Total interest Servicing Fee rate Total Servicing Fees Total Loan Costs Estimated Amortization Schedule City of Dubuque Taxable Revenue Bond CS- 192513 -02 ry Feb 28, 2014 Mar 28, 2014 Jun 1, 2033 20 $ 1,029,000.00 5,145.00 $ 1,023,855.00 1.75% 187,953.84 0.25% 26,798.20 219, 897.04 Initiation Fee - P & D Payoff - Estimated Draw #1- Estimated Draw #2- Estimated Draw #3- Estimated Draw #4- Estimated Draw #5- Estimated Draw #6- Estimated Draw #7- Estimated Draw #8- Estimated Draw #9- Estimated Draw #10- Held for Final Docs - Estimated Draw Schedule Feb 28, 2014 Feb 28, 2014 Feb 28, 2014 Mar 28, 2014 Total Loaned Amount 5,145.00 1,018,855.00 5,000.00 1,029,000.00 Payment Beginning Date Balance Principal Interest Servicing Fee Total Loan Total Annual Debt Ending Payment Service Balance Jun 1,2014 Dec 1,2014 Jun 1, 2015 Dec 1, 2015 Jun 1, 2016 Dec 1,2016 1,029,000.00 988,000.00 988,000.00 945,000.00 945,000.00 901,000.00 Jun 1, 2017 901,000.00 Dec 1, 2017 856,000.00 Jun 1, 2018 856,000.00 Dec 1, 2018 810,000.00 Jun 1, 2019 810,000.00 Dec 1, 2019 763,000.00 Jun 1, 2020 763,000.00 Dec 1, 2020 715,000.00 Jun 1, 2021 Dec 1, 2021 Jun 1, 2022 Dec 1, 2022 Jun 1, 2023 Dec 1, 2023 Jun 1, 2024 Dec 1, 2024 Jun 1, 2025 Dec 1, 2025 715,000.00 666,000.00 666,000.00 616,000.00 616,000.00 566,000.00 566,000.00 514,000.00 514,000.00 461,000.00 Jun 1, 2026 461,000.00 Dec 1, 2026 407,000.00 Jun 1, 2027 Dec 1, 2027 Jun 1, 2028 Dec 1,2028 Jun 1, 2029 Dec 1, 2029 407;000.00 352,000.00 352,000.00 296,000.00 296,000.00 239,000.00 Jun 1, 2030 239,000.00 Dec 1, 2030 181,000.00 Jun 1, 2031 181,000.00 Dec 1, 2031 122,000.00 Jun 1, 2032 122,000.00 Dec 1, 2032 62,000.00 Jun 1, 2033 62,000.00 As of 1/29/2014 41,000.00 43,000.00 _ 44,000.00 45,000.00 46,000.00 47,000.00 48,000.00 49,000.00 50,000.00 50,000.00 52,000.00 53,000.00 54,000.00 55,000.00 56,000.00 57,000.00 58,000.00 59,000.00 60,000.00 62,000.00 4,545.09 8,645.00 9,003.75 8,268.75 8,268.75 7,883.75 7,883.75 7,490.00 7,490.00 7,087.50 7,087.50 6,676.25 6,676.25 6,256.25 6,256.25 5,827.50 5,827.50 5,390.00 5,390.00 4,952.50 4,952.50 4,497.50 4,497.50 4,033.75 4,033.75 3,561.25 3,561.25 3,080.00 3,080.00 2,590.00 2,590.00 2,091.25 2,091.25 1,583.75 1,583.75 1,067.50 1,067.50 542.50 542.50 648.20 1,235.00 1,235.00 1,181.25 1,181.25 1,126.25 1,126.25 1,070.00 1,070.00 1,012.50 1,012.50 953.75 953.75 893.75 893.75 832.50 832.50 770.00 770.00 707.50 707.50 642.50 642.50 576.25 576.25 508.75 508.75 440.00 440.00 370.00 370.00 298.75 298.75 226.25 226.25 152.50 152.50 77.50 77.50 46,193.29 9,880.00 ,53,238.75 9,450.00 53 450.00 9,010.00 54,010.00 8,560.00 54,560.00 8,100.00 55,100.00 7,630.00 55,630.00 7,150.00 56,150.00 6,660.00 56,660.00 6,160.00 56,160.00 5,660.00 57,660.00 5,140.00 58,140.00 4,610.00 58,610.00 4,070.00 59,070.00 3,520.00 59,520.00 2,960.00 59,960.00 2,390.00 60,390.00 1,810.00 60 810.00 1,220.00 61,220.00 620.00 62,620.00 46,193.29 63,118.75 62,900.00 63,020.00 63,120.00 63,200.00 63,260.00 63,300.00 63 320.00 62,320.00 63,320.00 63,280.00 63,220.00 63,140.00 63,040.00 62,920.00 62,780.00 62,620.00 62,440.00 _ 63,240.00 988,000.00 988,000.00 945.000.00 945,000.00 901,000.00 901,000.00 856,000.00 856,000.00 810,000.00 810,000.00 763,000.00 763,000.00 715 000.00 715,000.00 666,000.00 666,000.00 616,000.00 616,000.00 566,000.00 566,000.00 514,000.00 514,000.00 461,000.00 461,000.00 407,000.00 407,000.00 352,000.00 352,000.00 296,000.00 296,000.00 239,000.00 239,000.00 181,000.00 181,000.00 122 000.00 122,000.00 62,000.00_ 62,000.00 0.00 INVESTING IN IOWA'S WATER www.iowasrf.com TRANSCRIPT CERTIFICATE I, the undersigned, being first duly sworn, do hereby depose and certify that I am the duly appointed, qualified and acting Clerk of the City of Dubuque, Iowa, and that as such Clerk I have in my possession or have access to the complete corporate records of said City and of its Council and officials, and that I have carefully compared the transcript hereto attached with the aforesaid corporate records and that said transcript hereto attached is a true and complete copy of all the corporate records in relation to the authorization, issuance and disposition of $1,029,000 Storm Water Utility Revenue Capital Loan Notes, Taxable Series 2014A, of said City dated the date of delivery, and that said transcript hereto attached contains a true and complete statement of all the measures adopted and proceedings, acts and things had, done and performed up to the present time, in relation to the authorization, issuance and disposition of said Notes, and that said Council consists of a Mayor and six (6) Council Members, and that said offices were duly and lawfully filled by the individuals listed in the attached transcript as of the dates and times referred to therein. I further certify that said City is and throughout the period of said proceedings has been governed under the Mayor /Council form of municipal government authorized by Chapter 372, City Code of Iowa, under the provisions of its charter as recorded with the Secretary of State. I further certify that all meetings of the City Council of said City at which action was taken in connection with said Notes were open to the public at all times in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and was duly given at least twenty -four hours prior to the commencement of the meeting by notification of the communications media having requested such notice and posted on a bulletin board or other prominent place designated for the purpose and easily accessible to the public at the principal office of the Council all pursuant to the provisions and in accordance with the conditions of the local rules of the Council and Chapter 21, Code of Iowa. I further certify that no City officer or employee has any interest in the contract for the sale of the Notes or any matter incidental thereto, according to my best knowledge and belief. I further certify the stated officers whose signatures appear below are now the duly qualified and acting officials of the City, possessed of the offices as designated below, to- wit: STATE OF IOWA ) SS COUNTY OF DUBUQUE Subscribed and sworn to before me by Kevin Firnstahl, on this day of , 2014. (Seal) Notary Public in and for Dubuque County, Iowa 00997163 -1 \10422 -149 Masterpiece on the Mississippi TO: Michael C. Van Milligen, City Man FROM: Gus Psihoyos, City Engineer SUBJECT: Dubuque katil all- amenca City 'I'll., 2007 • 2012 • 2013 Lower Bee Branch Creek Restoration Project, State Revolving Loan Funds (SRF) Construction Supplemental Loan Application DATE: January 17, 2014 INTRODUCTION The purpose of this memo is to present a state revolving loan fund (SRF) application for a supplemental loan for the Lower Bee Branch Creek Restoration Project for review and approval. BACKGROUND Through the adoption of the Capital Improvement Program Budget for the Bee Branch Creek Restoration Project, the City Council established that the Bee Branch project was to be funded using State Revolving Loan Funds (SRF). On September 20, 2010 the City Council passed Resolution 381 -10 authorizing the issuance not to exceed $10,100,000 in Storm Water Utility Revenue Capital Loan Notes of Dubuque for the Lower Bee Branch Creek Restoration Project. As of December 5, 2013, SRF debt for the Lower Bee Branch Creek Restoration Project has been issued in the amount of $7,845,000, which expends the maximum amount of the loan requested from the Iowa Finance Authority in October 2010. The City has spent $1,029,243 in legal fees and increased construction costs for the Lower Bee Branch Creek Restoration Project. The City is therefore requesting a supplemental SRF Loan to fund these costs. There is an estimated $740,000 in remaining project costs that will be requested on a second SRF supplemental loan to be requested at a later date. DISCUSSION Attached is a State Revolving Fund Loan Application for a supplemental loan for the Lower Bee Branch Creek Restoration Project. The application was prepared with help and information from the Budget Director and the Finance Department. The application amount of $1,029,243 reflects the amount needed to fund legal fees and change orders from the Lower Bee Branch Creek Restoration construction contract with Tschiggfrie. This is a supplemental loan that increases the original SRF loan issued for the Lower Bee Branch Creek Restoration project. A second SRF supplemental loan will be required at a later date in the amount of $740,000 to complete all elements approved by the Department of Natural Resources for the Lower Bee Branch Creek Restoration Project. This loan will be requested when the final elements approved by the Iowa Department of Natural Resources are scheduled to be constructed. The two supplemental loans will increase the original loan amount of $7,850,000 previously issued for the Lower Bee Branch Creek Restoration project to $9,619,243. The final loan amount may be less if there is a contingency left at the end of the construction project. Resolution 381 -10 passed by City Council in September 2010 approved $10,100,000 in Storm Water Utility Revenue Capital Loan Notes of Dubuque for this project. Once the attached application has been signed, it will be submitted to the Iowa Finance Authority for processing. ACTION TO BE TAKEN I respectfully request that you review and sign the attached State Revolving Fund Loan Application and return them to the Engineering Department. Once signed, the Engineering Department will submit the application to the Iowa Finance Authority for processing. attach. Prepared by Deron Muehring cc: Jenny Larson, Budget Director Ken TeKippe, Finance Director Deron Muehring, Civil Engineer II Construction Loan Application Applicant: City of Dubuque Tax ID Number: 42- 6004596 Contact person/Title: Kenneth J. Tekippe, Finance Director Address: 50 West 13th Street City Dubuque County Dubuque Zip Code: 52001 Telephone Number: 563.589.4133 Fax Number: 563.589.0890 E -mail address: ktekippe @cityofdubuque.org ® Clean Water SRF NPDES Number: NA ❑ Drinking Water SRF PWSID Number: Please write a brief description of the project: The purpose of the Lower Bee Branch Creek Restoration Project is to alleviate surface flooding, alleviate sanitary sewer backups that result in the flooding of basements with wastewater, and improve the water quality of the Bee Branch, a water of the United States. The project involves the day - lighting 2,100 feet of the buried creek (Bee Branch/Couler Creek) that is confined to a buried rock storm sewer. The design outlines a meandering 15 to 25 -foot wide creek through a 150 to 180 -foot corridor. During heavier rains, the stormwater will rise out of the creek and spread into the flood channel. STATE REVOLVING FUND Do you have all permits /clearances required for this project? Yes No N/A Date Obtained Date Expected Environmental Review (FONSI or CX) ❑ ❑ .1 Residential 20,701 Operating Permit ❑ ❑ .1 1,500,000 46% Construction Permit L ❑ ❑ 08/12/10 Others: /1 ❑ ❑ 06/23/10 Is the system under any regulatory compliance order? ❑ Yes ® No What is the expected construction start date? 08/23/10 Have construction bids been awarded? ® Yes ❑ No What is the expected project completion date? 04/31/15 How many people are served by the system? 58,000 System Utilization for the most recent year: Number of Connections Annual Revenue Percentage of System Annual Usage Residential 20,701 1,748,008 54% Commercial 1,687 1,500,000 46% Industrial Included with Commercial Other Unmetered Total 22,388 3,248,008 Iowa Finance Authority 2015 Grand Avenue Des Moines, IA 50312 800 - 432 -7230 PROFESSIONAL CONSULTANTS Project Engineer: Strand & Associates Name of Contact Person: Mike Bridwell, PE Mailing Address: 910 West Wingra Drive City, State, and Zip Code: Madison, WI 53715 Telephone Number: 608.251.4843 E -mail address: mike.bridwell @strand.com Bond Counsel: Ahlers & Cooney, LLP Name of Contact Person: William Noth Mailing Address: _100 Court Ave City, State, and Zip Code: Des Moines, IA 50309 -2256 Telephone Number: 515.246.0332 E -mail address: wnoth @ahlerslaw.com Financial Advisor: Name of Contact Person: Mailing Address: City, State, and Zip Code: Telephone Number: E -mail address: SOURCE OF FUNDS /COST BREAKDOWN FOR PROJECT Project Cost Breakdown Administrative, Financial & Legal expenses $ 249,769 Planning & Design expenses $ Engineering construction fees $ Construction $ 774,353 Equipment $ Other- Specify $ Other- Specify $ Other- Specify $ Other- Specify $ Contingency $ Total Project Cost $ 1,024,122 Minus Funds from other sources $ 0 SRF Loan Subtotal $ 1,024,122 0.5% loan origination fee (.005 x SRF amount) $ 5,121 Total SRF Loan (round to nearest $1,000) $1,029,243 Source of Funds Total SRF Loan (from above) $ 1,029,243 Federal grant or loan- Specify $ Applicant's share $ Other- Specify $ Total Source of Funds $ 1,029,243 2 Are you interested in an extended term loan (up to 30 years ?) ❑ Yes ® No If yes, has the extended term worksheet been completed and submitted to DNR? ❑ Yes ❑ No NOTE: extended terms are available for all CWSRF loans. The applicant must be considered disadvantaged (51% of population low -to moderate - income) to get an extended term DWSRF loan. Type of debt requested (check one): G.O. ❑ Revenue ►1 Combination f l If GO — Has Bond Counsel or Financial Advisor calculated GO debt capacity for this project? ❑ Yes ❑ No If Revenue: Do you have any outstanding debt payable from the system revenues? ® Yes ❑ No If Yes, please list or attach debt schedules: Existing System Debt: Current Balance Interest Rate Year Issued Maturity Date Annual Payment (Principal + Interest) Revenue Bonds Other Debt (Payable from System Revenues) Has Financial Advisor reviewed parity debt provisions for outstanding debt? ❑Yes Do you have a current bond rating? ® Yes ❑ No ❑ I don't know If yes, what is it? Aal From which rating agency? ® Moody's ['S&P Have ordinances related to increasing rates been adopted for financing this project? If no — are you planning on increasing rates? ® Yes n No If yes — when will these ordinances be adopted? What will average monthly residential user rates be with new ordinance? No ®NA ❑ Fitch ❑ Yes ® No The applicant must enclose (or email) the following documentation with the completed application. Attach Five year pro -forma showing revenue and expenses for system Link Most recent financial statement ® Audited ❑ Unaudited (If your financial information is available online, you may just provide a link) The undersigned is duly authorized to request this loan on behalf of the Applicant. The Applicant declares under penalty of law that all facts given and information attached are true and correct. The Applicant authorizes IFA to veri all information. Authorized Signature J Typed Name and Title Mike Van Milligen, City Manager Please mail completed applications to: Iowa Finance Authority Attn: Tracy Scebold 2015 Grand Ave. Des Moines, IA 50312 3 Date 01/06/14