RES 19-28City of
Elk — -
River
EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF
THE CITY OF ELK RIVER, MINNESOTA
HELD: July 15, 2019
Pursuant to due call and notice thereof, a regular meeting of the City Council of City of Elk
River, Minnesota, was duly called and held at the City Hall in the City on Monday, the 15th day of
July, 2019, at 6:00 o'clock P.M.
The following members were present: r ayor i)ietz, uounciimembers westgaard, Wagner,
Ghristianson, and Ovall
and the following were absent: none
Member westgaard
adoption:
introduced the following resolution and moved its
CITY OF ELK RIVER
RESOLUTION 19- /-:s
RESOLUTION PROVIDING FOR THE COMPETITIVE
NEGOTIATED SALE OF $33,735,000 GENERAL OBLIGATION
SALES TAX REVENUE BONDS, SERIES 2019A
BE IT RESOLVED by the City Council of the City of Elk River, Minnesota, as follows:
1. Finding: Amount and Pumose. It is hereby found, determined and declared that the
City of Elk River, Minnesota (the "City"), should issue $33,735,000 General Obligation Sales Tax
Revenue Bonds, Series 2019A, which may be issued in one or more series, to finance authorized
projects, including without limitation, the acquisition and betterment of certain recreational facility
improvements, park improvements, trail improvements, and dredging of Lake Orono.
2. Meeting. This City Council shall meet on the date and at the time and place
specified in the form of Terms of Proposal attached hereto as Exhibit A for the purpose of
awarding the sale of the Bonds.
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3.
Competitive
Negotiated Sale. The City has retained Baker Tilly Municipal Advisors,
LLC ("Baker
Tilly
MA") as an independent municipal advisor, and the City Council hereby
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determines to sell the Bonds by private negotiation, by way of a competitive sale in response to
Terms of Proposal for the Bonds which are not published in any newspaper or journal.
4. Terms of Proposal. The terms and conditions of the Bonds and the sale thereof are
fully set forth in the "Terms of Proposal' attached hereto as Exhibit A and hereby made a part
hereof, provided that the Bonds may be issued in one or more series.
5. Official Statement. The City Finance Director and other officers or employees of
the City are hereby authorized to participate with Baker Tilly MA in the preparation of an official
statement for the Bonds.
The motion for the adoption of the foregoing resolution was duly seconded by member
wagner and, after full discussion thereof and upon a vote being taken thereon, the
following voted in favor thereof:
and the following voted against the same:
Whereupon said resolution was declared duly passed and adopted this 15`h day of July 2019.
ATTEST:
Tina Allard, City Clerk
2
J n J. thietz, . ayor
mover
STATE OF MINNESOTA )
CITY OF ELK RIVER ) SS.
SHERBURNE COUNTY )
I, the undersigned, being the duly qualified and acting Clerk of the City of Elk River,
Minnesota (the "City"), DO HEREBY CERTIFY that I have carefully compared the attached and
foregoing extract of minutes with the original minutes of a meeting of the City Council called and
held on the date therein indicated, which are on file and of record in my office, and the same is a
full, true and complete transcript therefrom insofar as the same relates to the City's $33,735,000
General Obligation Sales Tax Revenue Bonds, Series 2019A.
WITNESS my hand as such Clerk of the City this 15th da July, 2019.
City Clerk
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589683v1EL185-44
r
` 1
City Of
Elk"
River
EXHIBIT A
THE CITY HAS AUTHORIZED BAKER TILLY MUNICIPAL ADVISORS, LLC TO
NEGOTIATE THIS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE
FOLLOWING BASIS:
TERMS OF PROPOSAL
$33,735,000*
CITY OF ELK RIVER, MINNESOTA
GENERAL OBLIGATION SALES TAX REVENUE BONDS, SERIES 2019A
(BOOK ENTRY ONLY)
Proposals for the above -referenced obligations (the "Bonds") will be received by the City of Elk
River, Minnesota (the "City") on Monday, August 19, 2019 (the "Sale Date") until 11:00 A.M.,
Central Time at the offices of Baker Tilly Municipal Advisors, LLC ("Baker Tilly MA'D, 380 Jackson
Street, Suite 300, Saint Paul, Minnesota, 55101, after which time proposals will be opened and
tabulated. Consideration for award of the Bonds will be by the City Council at its meeting
commencing at 6:00 P.M., Central Time, of the same day.
SUBMISSION OF PROPOSALS
Baker Tilly MA will assume no liability for the inability of a bidder to reach Baker Tilly MA prior to
the time of sale specified above. All bidders are advised that each proposal shall be deemed to
constitute a contract between the bidder and the City to purchase the Bonds regardless of the
manner in which the proposal is submitted.
(a) Sealed BW&M. Proposals may be submitted in a sealed envelope or by fax (651) 223-3046 to
Baker Tilly MA. Signed proposals, without final price or coupons, may be submitted to Baker Tilly
MA prior to the time of sale. The bidder shall be responsible for submitting to Baker Tilly MA the
final proposal price and coupons, by telephone (651) 223-3000 or fax (651) 223-3046 for inclusion
in the submitted proposal.
row,,
(b) Electronic Bidding. Notice is hereby given that electronic proposals will be received via
PARITY®. For purposes of the electronic bidding process, the time as maintained by PARITY'
shall constitute the official time with respect to all proposals submitted to PARITY®. Each bidder
shall be soleyreiponsible for making necessary arrangements to access PARITY° for purposes of submitting its
electronic proposal in a timely manner and in compliance with the requirements of the Teras of Proposal. Neither
the City, its agents, not PARITY® shall have any duty or obligation to undertake registration to bid
for any prospective bidder or to provide or ensure electronic access to any qualified prospective
bidder, and neither the City, its agents, nor PARITY® shall be responsible for a bidder's failure to
register to bid or for any failure in the proper operation of, or have any liability for any delays or
interruptions of or any damages caused by the services of PARITY®. The City is using the services
* Preliminary; subject to change.
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of PARITY`S solely as a communication mechanism to conduct the electronic bidding for the
Bonds, and PARITY° is not an agent of the City.
If any provisions of this Terms of Proposal conflict with information provided by PARITY', this
Terms of Proposal shall control. Further information about PARITY, including any fee charged,
may be obtained from:
PARITY°, 1359 Broadway, 2nd Floor, New York, New York 10018
Customer Support: (212) 849-5000
DETAILS OF THE BONDS
The Bonds will be dated as of the date of delivery and will bear interest payable on June 1 and
December 1 of each year, commencing June 1, 2020. Interest .will be computed on the basis of a
360 -day year of twelve 30 -day months.
The Bonds willmature December 1 in the years and amounts* as follows:
2021
$605,000
2025
$1,015,000
2030
$1,240,000
2035
$1,190,000
2040
$1,740,000
2022
$870,000
2026
$1,060,000
2031
$1,285,000
2036
$1,535,000
2041
$1,795,000
2022
$905,000
2027
$1,100,000
2032
$1,340,000
2037
$1,585,000
2042
$1,855,000
2023
$940,000
2029
$1,145,000
2033
$1,390,000
2038
$1,630,000
2043
$1,920,000
2024
$980,000
2029
$1,190,000
2034
$1,450,000
2039
$1,685,000
2044
$1,985,000
* The City reserves the right, of er proposals are opened and prior to award, to increase or reduce the principal amount of the Bonds or the
amount of any maturity or maturities in multiples of ,$3,000. In the event the amount of any maturity is modified, the aggregate
purchase price will be adjusted to result in the same gross spread per $1,000 of Bonds as that of the origina1propoxaZ Gross spread for
°—• tbis purpose is the differential between the price paid to the City for the nese issue and the prices at which the proposal indicates the
securities will be initially offered to the investing public.
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial
bonds and term bonds. All term bonds shall be subject to mandatory sinking fund redemption at a
price of par plus accrued interest to the date of redemption scheduled to conform to the maturity
schedule set forth above. In order to designate term bonds, the proposal must specify "Years of
Term Maturities" in the spaces provided on the proposal form.
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of Bonds
made to the public. The Bonds will be issued in fully registered form and one Bond, representing
the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of
Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which
will act as securities depository for the Bonds. Individual purchases of the Bonds may be made in
the principal amount of $5,000 or any multiple thereof of a single maturity through book entries
made on the books and records of DTC and its participants. Principal and interest are payable by
the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and
interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and
interest payments to beneficial owners by participants will be the responsibility of such participants
and other nominees of beneficial owners. The lowest bidder (the "Purchaser"), as a condition of
0 delivery of the Bonds, will be required to deposit the Bonds with DTC.
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City
.ver
REGISTRAR
The City will name the registrar which shall be subject to applicable regulations of the Securities and
Exchange Commission. The City will pay for the services of the registrar.
OPTIONAL REDEMPTION
The City may elect on December 1, 2028, and on any day thereafter, to redeem Bonds due on or
after December 1, 2029. Redemption may be in whole or in part and if in part at the option of the
City and in such manner as the City shall determine. If less than all Bonds of a maturity are called
for redemption, the City will notify DTC of the particular amount of such maturity to be redeemed.
DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed
and each participant will then select by lot the beneficial ownership interests in such maturity to be
redeemed. All redemptions shall be at a price of par plus accrued interest.
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. In addition, the City will pledge a sales and
use tax of one-half of one percent (0.50%) for repayment of the Bonds. The proceeds will be used
to finance the acquisition and betterment of certain recreational facility improvements, park
improvements, trail improvements, and dredging of Lake Orono.
BIDDING PARAMETERS
Proposals shall be for not less than $33,735,000 (Par) plus accrued interest, if any, on the total
principal amount of the Bonds. No proposal can be withdrawn or amended after the time set for
receiving proposals on the Sale Date unless the meeting of the City scheduled for award of the
Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been
made. Rates shall be in integral multiples of 1/100 or 1/8 of 1%. The initial price to the public for
each maturity as stated on the proposal must be 98.0% or greater. Bonds of the same maturity shall
bear a single rate from the date of the Bonds to the date of maturity. No conditional proposals will
be accepted.
ESTABLISHMENT OF ISSUE PRICE
In order to provide the City with information necessary for compliance with Section 148 of the
Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder
(collectively, the "Code"), the Purchaser will be required to assist the City in establishing the issue
price of the Bonds and shall complete, execute, and deliver to the City prior to the closing date, a
written certification in a form acceptable to the Purchaser, the City, and Bond Counsel (the "Issue
Price Certificate") containing the following for each maturity of the Bonds (and, if different interest
rates apply within a maturity, to each separate CUSIP number within that maturity): (i) the interest
rate; (ii) the reasonably expected initial offering price to the "public" (as said term is defined in
Treasury Regulation Section 1.148-1(f) (the "Regulation")) or the sale price; and (iii) pricing wires or
* Preliminary; subject to change.
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equivalent communications supporting such offering or sale price. Any action to be taken or
documentation to be received by the City pursuant hereto may be taken or received on behalf of the
City by Baker Tilly MA.
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Gty of
E.
River
The City intends that the sale of the Bonds pursuant to this Terms of Proposal shall constitute a
"competitive sale" as defined in the Regulation based on the following:
(i) the City shall cause this Terms of Proposal to be disseminated to potential
bidders in a manner that is reasonably designed to reach potential bidders;
(ii) all bidders shall have an equal opportunity to submit a bid;
(iii) the City reasonably expects that it will receive bids from at least three bidders
that have established industry reputations for underwriting municipal bonds such as
the Bonds; and
(iv) the City anticipates awarding the sale of the Bonds to the bidder who
provides a proposal with the lowest true interest cost, as set forth in this Terms of
Proposal (See "AWARD" herein).
Any bid submitted pursuant to this Terms of Proposal shall be considered a firth offer for the
purchase of the Bonds, as specified in the proposal. The Purchaser shall constitute an "underwriter"
as said term is defined in the Regulation. By submitting its proposal, the Purchaser confirms that it
shall require any agreement among underwriters, a selling group agreement, or other agreement to
which it is a party relating to the initial sale of the Bonds, to include provisions requiring compliance
with the provisions of the Code and the Regulation regarding the initial sale of the Bonds.
If all of the requirements of a "competitive sale" are not satisfied, the City shall advise the Purchaser
of such fact prior to the time of award of the sale of the Bonds to the Purchaser. In such event,
any proposal submitted will not be subject to cancellation or withdrawal. Within twenty-four
(24) hours of the notice of award of the sale of the Bonds, the Purchaser shall advise the City and
Baker Tilly MA if 10% of any maturity of the Bonds (and, if different interest rates apply within a
maturity, to each separate CUSIP number within that maturity) has been sold to the public and the
price at which it was sold. The City will treat such sale price as the "issue price" for such maturity,
applied on a maturity -by -maturity basis. The City will not require the Purchaser to comply with that
portion of the Regulation commonly described as the "hold -the -offering -price" requirement for the
remaining maturities, but the Purchaser may elect such option. If the Purchaser exercises such
option, the City will apply the initial offering price to the public provided in the proposal as the issue
price for such maturities. If the Purchaser does not exercise that option, it shall thereafter promptly
provide the City and Baker Tilly MA the prices at which 10% of such maturities are sold to the
public; provided such determination shall be made and the City and Baker Tilly MA notified of such
prices whether or not the closing date has occurred, until the 10% test has been satisfied as to each
maturity of the Bonds or until all of the Bonds of a maturity have been sold.
GOOD FAITH DEPOSIT
To have its proposal considered for award, the Purchaser is required to submit a good faith deposit
to the City in the amount of $337,350 (the "Deposit") no later than 2:00 P.M., Central Time on the
Sale Date. The Deposit may be delivered as described herein in the form of either (i) a certified or
cashier's check payable to the City; or (ii) a wire transfer. The Purchaser shall be solely responsible
for the timely delivery of its Deposit whether by check or wire transfer. Neither
* Preliminary; subject to change.
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Elk
River
the City nor Baker Tilly MA have any liability for delays in the receipt of the Deposit. If the Deposit
is not received by the specified time, the City may, at its sole discretion, reject the proposal of the
lowest bidder, direct the second lowest bidder to submit a Deposit, and thereafter award the sale to
such bidder.
Certified or Cashier's Check. A Deposit made by certified or cashier's check will be considered timely
delivered to the City if it is made payable to the City and delivered to Baker Tilly Municipal
Advisors, LLC, 380 Jackson Street, Suite 300, Saint Paul, Minnesota 55101 by the time specified
above.
Wire Transfer. A Deposit made by wire will be considered timely delivered to the City upon
submission of a federal wire reference number by the specified time. Wire transfer instructions will
be available from Baker Tilly MA following the receipt and tabulation of proposals. The successful
bidder must send an e-mail including the following information: (i) the federal reference number and
time released; (ii) the amount of the wire transfer; and (iii) the issue to which it applies.
Once an award has been made, the Deposit received from the Purchaser will be retained by the City
and no interest will accrue to the Purchaser. The amount of the Deposit will be deducted at
settlement from the purchase price. In the event the Purchaser fails to comply with the accepted
proposal, said amount will be retained by the City.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis calculated on the proposal prior to any adjustment made by the City. The
City's computation of the interest rate of each proposal, in accordance with customary practice, will
be controlling.
The City will reserve the right to: (i) waive non -substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals without
cause, and (iii) reject any proposal that the City determines to have failed to comply with the terms
herein.
BOND INSURANCE AT PURCHASER'S OPTION
The City has not applied for or pre -approved a commitment for any policy of municipal bond
insurance with respect to the Bonds. If the Bonds qualify for municipal bond insurance and a
bidder desires to purchase a policy, such indication, the maturities to be insured, and the name of
the desired insurer must be set forth on the bidder's proposal. The City specifically reserves the
right to reject any bid specifying municipal bond insurance, even though such bid may result in the
lowest TIC to the City. All costs associated with the issuance and administration of such policy and
associated ratings and expenses (other than any independent rating requested by the City) shall be
paid by the successful bidder. Failure of the municipal bond insurer to issue the policy after the
award of the Bonds shall not constitute cause for failure or refusal by the successful bidder to accept
delivery of the Bonds.
* Preliminary; subject to change.
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City of
Elk.,
River
CUSIP NUMBERS
If the Bonds qualify for the assignment of CUSIP numbers such numbers will be printed on the
Bonds; however, neither the failure to print such numbers on any Bond not any error with respect
thereto will constitute cause for failure or refusal by the Purchaser to accept delivery of the Bonds.
Baker Tilly MA will apply for CUSIP numbers pursuant to Rule G-34 implemented by the Municipal
Securities Rulemaking Board. The CUSIP Service Bureau charge for the assignment of CUSIP
identification numbers shall be paid by the Purchaser.
SETTLEMENT
On or about September 19, 2019, the Bonds will be delivered without cost to the Purchaser through
DTC in New York, New York. Delivery will be subject to receipt by the Purchaser of an approving
legal opinion of Kennedy & Graven, Chartered of Minneapolis, Minnesota, and of customary
closing papers, including a no -litigation certificate. On the date of settlement, payment for the
Bonds shall be made in federal, or equivalent, funds that shall be received at the offices of the City
or its designee not later than 12:00 Noon, Central Time. Unless compliance with the terms of
payment for the Bonds has been made impossible by action of the City, or its agents, the Purchaser
shall be liable to the City for any loss suffered by the City by reason of the Purchaser's non-
compliance with said terms for payment.
CONTINUING DISCLOSURE
In accordance with SEC Rule 15c2 -12(b)(5), the City will undertake, pursuant to the resolution
awarding sale of the Bonds, to provide annual reports and notices of certain events. A description
of this undertaking is set forth in the Official Statement. The Purchaser's obligation to purchase the
Bonds will be conditioned upon receiving evidence of this undertaking at or prior to delivery of the
Bonds.
OFFICIAL STATEMENT
The City has authorized the preparation of a Preliminary Official Statement containing pertinent
information relative to the Bonds, and said Preliminary Official Statement has been deemed final by
the City as of the date thereof within the meaning of Rule 15c2-12 of the Securities and Exchange
Commission. For copies of the Preliminary Official Statement or for any additional information
prior to sale, any prospective purchaser is referred to the Municipal Advisor to the City, Baker Tilly
Municipal Advisors, LLC, 380 Jackson Street, Suite 300, Saint Paul, Minnesota 55101, telephone
(651) 223-3000.
A Final Official Statement (as that term is defined in Rule 15c2-12) will be prepared, specifying the
maturity dates, principal amounts, and interest rates of the Bonds, together with any other
information required by law. By awarding the Bonds to the Purchaser, the City agrees that, no more
than seven business days after the date of such award, it shall provide without cost to the Purchaser
up to 25 copies of the Final Official Statement. The City designates the Purchaser as its agent for
purposes of distributing copies of the Final Official Statement to each syndicate member, if
* Preliminary; subject to change.
589683v1EL185-44
applicable. The Purchaser agrees that if its proposal is accepted by the City, (i) it shall accept
designation and (ii) it shall enter into a contractual relationship with its syndicate members for
purposes of assuring the receipt of the Final Official Statement by each such syndicate member.
Dated July 15, 2019
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BY ORDER OF THE CITY COUNCIL
/s/ Tina Allard
City Clerk