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2008-09-23 Resolution
0 4e~ Prepared by: Sara F. G. Hektoen, Asst. City Atty., 410 E. Washington St., Iowa City, IA 52240 (319) 356-5030 RESOLUTION NO. 08-284 RESOLUTION SETTING A PUBLIC HEARING FOR OCTOBER 6, 2008, TO CONSIDER AN AGREEMENT FOR WALKWAY IMPROVEMENTS AND FUTURE PARTIAL RELEASE OF INTERIOR PEDESTRIAN ACCESS EASEMENT ON 210 SOUTH DUBUQUE STREET, IOWA CITY, IOWA. WHEREAS, RBD Iowa City LLC, current owner of the Sheraton Hotel, located at 210 South Dubuque Street, has requested the City vacate a portion of the public pedestrian access easement so that they are able to narrow the easement area from 25' to 12' and restrict access between 11 p.m. and 6 a.m.; and WHEREAS, these changes. to the current access easement have been requested to facilitate the construction renovations to its lobby and restaurant and to provide additional security for its guests; and WHEREAS, in exchange for this partial release of the easement, the Sheraton has agreed to pay for 50% of the costs of improving the pedestrian access easement that currently runs along the west side of its building; and WHEREAS, said improvement to the west exterior easement area shall include additional lighting, architectural features, way-finding signage and public art, which will enhance its attractiveness and public safety. NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF IOWA CITY, IOWA, that: The City Council does hereby declare its intent to consider an agreement for walkway improvements and future partial release of the pedestrian access easement running through the interior of 210 S_ Dubuaue Street. Iowa Citv. Iowa. 2. A public hearing on said proposal should be and is hereby set for October 6, 2008, at 7:00 p.m. in Emma J. Harvat Hall at City Hall, 410 East Washington Street, Iowa City, Iowa, or if said meeting is cancelled, at the next meeting of the City Council thereafter as posted by the City Clerk, and that the City Clerk be and is hereby directed to cause notice of said public hearing to be published as provided by law. Passed and approved this 23rd day of se tuber 08. M Y R Appr ved by ~ ~ ~~~ ATTEST: ~ /Xr~ CITY LERK City Attorney's Office q~j~d~ Resolution No. 08-284 Page 2 It was moved by O'Donnell and seconded by Wright the Resolution be adopted, and upon roll call there were: AYES: x x x ~_ x x X NAYS: ABSENT: Bailey Champion Correia Hayek O'Donnell Wilburn Wright wpdata/glossary/resolution-ic.doc M~ 4f 1 Prepared by: Ron Knoche, City Engineer, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5138 RESOLUTION NO. 08-285 RESOLUTION ACCEPTING THE WORK FOR THE 2008 WATER MAIN DIRECTIONAL BORING PROJECT WHEREAS, the Engineering Division has recommended that the work for construction of the 2008 Water Main Directional Boring Project, as included in a contract between the City of Iowa City and AAA Trenching and Specialized Boring of Norwalk, Iowa, dated May 19, 2008, be accepted; and WHEREAS, the Engineer's Report and the performance and payment bond has been filed in the City Clerk's office; and WHEREAS, the final contract price is $53,000.00. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IOWA, THAT said improvements are hereby accepted by the City of Iowa City, Iowa. Passed and approved this 23rd day of ATTEST: CIT ERK It was moved by 0' Donnell adopted, and upon roll call there were: AYES: tember ,20 08 i Approved by ~ f~ City Attorney's Office q~ q~a8- and seconded by Wright the Resolution be NAYS: ABSENT: x Bailey ~ Champion _ x Correia x Hayek x O'Donnell x Wilburn g Wright PW ENG~Accept-08 W aterMain.doc Mkt 4f 2 Prepared by: Susan Dulek, Asst. City Attorney, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5030 RESOLUTION NO. 08-286 RESOLUTION AUTHORIZING THE CITY MANAGER AND MAYOR TO SUBMIT ALL NECESSARY DOCUMENTATION TO APPLY FOR FLOOD RELIEF ASSISTANCE FROM THE STATE OF IOWA AND THE FEDERAL GOVERNMENT. WHEREAS, the State of Iowa has informed City staff that state funds for disaster recovery will soon be available; WHEREAS, said funds will consist of federal CDBG (Community Development Block Grant) disaster funds and State of Iowa money for the "Jumpstart" programs; and WHEREAS, the City Council finds that the public interest will be served by application for said funds. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IOWA, THAT: Except for the Hazard Mitigation Grant Program, the Mayor and City Manager are authorized to submit all necessary documentation to apply for flood relief assistance from the State of Iowa and the federal government. The application for the Hazard Mitigation Grant Program shall be by separate resolution. Passed and approved this 23rd day of September, 2008. A ATTEST: ,/~~J ~~J CIT LERK ~_~~~ City Attorney's Office Resolution No. Page 2 08-286 It was moved by O'Donnell adopted, and upon roll call there were: AYES: x x x x X X x and seconded by Wright the Resolution be NAYS: ABSENT: Bailey Champion Correia Hayek O'Donnell Wilburn Wright wpdata/glossary/resolution-ic. d oc M~8 4f 3 ~ Prepared by: Liz Osborne, CD Division, 410 E. Washington St., Iowa City, IA 52240 (319)356-5246 RESOLUTION NO. 08-287 RESOLUTION AUTHORIZING THE MAYOR TO EXECUTE AND THE CITY CLERK TO ATTEST TO A SUBORDINATION AGREEMENT BETWEEN THE CITY OF IOWA CITY AND UNIVERSITY OF IOWA COMMUNITY CREDIT UNION,. IOWA CITY, IOWA FOR PROPERTY LOCATED AT 821 CHURCH STREET, IOWA CITY, IOWA. WHEREAS, the City of Iowa City is the owner and holder of a Mortgage, executed by the owner of the property on April 20, 2004, and recorded on November 4, 2004, in Book 3812, Page 431 through Page 435, in the Johnson County Recorder's Office covering the following described real estate: Lot 2 in Block 9 in Iowa City, Iowa, according to the recorded plat thereof, subject to easements and restrictions of record WHEREAS, University of Iowa Community Credit Union has refinanced a mortgage to the owner of the property located at 821 Church Street and is securing the loan with a mortgage covering the real estate described above; and WHEREAS, University of Iowa Community Credit Union, has requested that the City execute the attached subordination agreement thereby making the City's lien subordinate to the lien of said mortgage with University of Iowa Community Credit Union; and WHEREAS, there is sufficient value in the above-described real estate to secure the City as a second lien. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IOWA that the Mayor is authorized to execute and the City Clerk to attest the subordination agreement between the City of Iowa City and University of Iowa Community Credit Union, Iowa City, Iowa. Passed and approved this 23rd day of September , 20 08 ATTEST ~f~ Q~ Tice Resolution No. 08-287 Page 2 It was moved by O'Donnell and seconded by Wright the Resolution be adopted, and upon roll call there were: AYES: NAYS: ABSENT: x Bailey x Champion x Correia x Hayek ~ O'Donnell x Wilburn x Wright SUBORDINATION AGREEMENT THIS AGREEMENT is made by and between the City of Iowa City, herein the City, and Universi of Iowa Community Credit Union of Iowa City, Iowa, herein the Financial Institution. WHEREAS, the City is the owner and holder of certain Mortgage which at this time is in the amount of $36,243.49, and was executed by Aaron L. Gwinnup, single and Ginger M. Walsh, single (herein the Owner), dated April 20, 2004, recorded November 4, 2004, in Book 3812, Page 431 through Page 435, Johnson County Recorder's Office, covering the following described real property: Lot 2 in Block 9 in Iowa City, Iowa, according to the recorded plat thereof, subject to easements and restrictions of record. WHEREAS, the Financial Institution proposes to loan the sum of $112,000 on a promissory note to be executed by the Financial Institution and the Owner, securing a mortgage covering the real property described above; and WHEREAS, to induce the Financial Institution to make such loan, it is necessary that the Mortgages held by the City be subordinated to the lien of the mortgage proposed to be made by the Financial Institution. NOW, THEREFORE, in consideration of the mutual covenants and promises of the parties hereto, the parties agree as follows: 1. Subordination. The City hereby covenants and agrees with the Financial Institution that the above noted Mortgages held by the City is and shall continue to be subject and subordinate to the lien of the mortgage about to be made by the Financial Institution. 2. Consideration. The City acknowledges receipt from the Financial Institution of One Hundred and Fifty Dollars ($150.00) and other good and valuable consideration for its act of subordination herein. 3. Senior Mortgage. The mortgage in favor of the Financial Institution is hereby acknowledged as a lien superior to the Mortgages of the City. 4. Binding Effect. This agreement shall be binding upon and inure to the benefit of the respective heirs, legal representatives, successors, and assigns of the parties hereto. Dated this 23rd day of September , 20~_. By Attest: City rk CITY'S ACKNOWLEDGEMENT STATE OF IOWA ) SS: JOHNSON COUNTY ) FINANC L INSTITUTION g On this a3 ~ day of SEPTF,~E~ , 20 a Y ,before me, the undersigned, a Notary Public in and for the State of Iowa, personally appeared c ~ ' (e and Marian K. Karr, to me personally known, and, who, being by me duly sworn, did ay that they are the Mayor and City Clerk, respectively, of the City of Iowa City, Iowa; that the seal affixed to the foregoing instrument is the corporate seal of the corporation, and that the instrument was signed and sealed on behalf of the corporation, by authority of its City Council, as contained in {~rdmanoe) (Resolution) No. 08~a87 passed (the Resolution adopted) by the City Council, under Roll Call No. - - of the City Council on the .~3 '% day of S~PTE~nnBErt , 20~, and that ~, Ba ; and Marian K. Karr acknowledged the execution of the instrument to be their vol ntary act and deed and the voluntary act and deed of the corporation, by it voluntarily executed. Jas SONDRAE FORT z° ~ Commission Number 159791 M~C mission Expires iow LENDER'S ACKNOWLEDGEMENT S F~,r-6 Notary Public in and for the State of Iowa STATE OF IOWA ) ss: CITY OF IOWA CITY JOHNSON COUNTY ) On this _~ day of ~ c,~t'a?.w20 do before me, the undersigned, a Notary Public in r^. and for the State of Iowa, personally appeared ~~~ ~- ~~~'~~~ to me personally known, who being by me duly sworn, did say that he/she is the '~i~.t.,~tie..~,d~:~C ~ t,~~ct~t.l~l~of i.~I'Cau.~~ G~;~- C.l~. _; that said instrument was signed on behalf of said corporation by authority of its Board of Directors; and that said i, L~~~R.a,~~o~ _ acknowledged the execution of said instrument to be the voluntary act and deed of said corporation, by it and by him/her voluntarily executed. ~~~ ~~~- Notary Public in and or the State of Iowa My Commission expires: '` o , G1R0~ J. ~plEST .Z ~ ~ ~~ ~~ ~ L ~ ~ 9• Sy~a ~ ~ ~ ~' ~~ ~ .• _ y, :. ~~'~.~ e' 1 ~' ., ~~~ ~ ,h. ~~~ .~ r t~ ~~ =.' ~- Pte, tiu ~`, 4 ~ '~ I~ -. ~ ' ~ ~~~:i A ~ i _ • 5 '~ ~~ ~~ .. '~ m "'a'L . ~ ~~n.,.. i a _..~, - '~ p ~^ ~ _ `, ~°` - ~° v i °~~: 1 '~~ I 1 ~' I ~, ~ ~ ~: ,^ !~ 4.. ~ r ® ~p J ~ yy ~V 'I~ ~ a ~~ u L, s •~ ~~~ .,,,~ _, d ~. ~__ - ire ~~_, .~ "~ ~s:~ _ ~. ~u~ ~~i.~ IL~~~Z ~ n~ ~ ~ ~ r ~~~ ~ ~:~ ~~~ ~~ ~ ~ ="' ry ~. ~ , ~~ ~~ . ~~'~ ~~ 1 L I ate- ~ R n Vt m l ~ ~ ~_- w~ ~~ ~~ '~ ~ ~ City of lovrra City MEMORANDUM Date: August 12, 2008 To: City Council From: Julie Tallman, Flood Plain Administrator Re: Idyllwild condominiums -flood plain designation- a Today, FEMA notified the City that 3 of the 4-plex structures at Idyllwild are within the 100 ~j~ year flood plain. On August 7, 2008 FEMA rescinded Letters of Map Revision (LOM~J ~~ based on fill for 3 of the 4-plex structures at Idyllwild (11, 13,15,17 Camborne Circle, 42, ,'~v i 44, 46, 48 Camborne Circle; and 42,44,46,48 Pentire Circle) and determined that these~~~D three structures are located in the 100 year flood plain (otherwise known as the SFHA - Special Flood Hazard Area). Between 1995 and 2002, FEMA issued LOMRs (Letters of Map Revision) based on fill to nearly all structures that had been built at Idyllwild. This means that the placement of fill at the building sites was such that the structures were at or above the BFE (base flood elevation). These structures were removed from the 100 year flood plain by virtue of the LOMRs. In August of 2002 the BFE of the Iowa River was increased by about a foot to 651 feet. With this increase in BFE, the three structures noted above were now built on land that was lower than the revised BFE, i.e. no longer out of the flood plain. However, FEMA continued to reauthorize the LOMRs for these 3 structures as recently as February 2007, the date of the most recently published Flood Insurance Rate Map. The City received notice today that FEMA issued a "Letter of Map Revision Based on Fill Determination Document (Non-Removal)„ rescinding the earlier letters of removal and stating that these three structures are not removed from the 100 year flood plain. Thus, as of today, the 3 buildings (12 units) noted above are within the 100 year flood plain. The rest are at or above the BFE, continue to have valid LOMRs based on fill and are not within the 100 year flood plain. cc: Michael Lombardo, City Manager Dale Helling, Assistant City Manager Eleanor Dilkes, City Attorney Marian Karr, City Clerk Jeff Davidson, Planning Director Steve Long, Community Development Doug Boothroy, HIS Director Rick Fosse, PW Director eleanor/mem/CGunderll .doc i Voluntary Ftood Buy-Outer ~' ~~ ~~,~ ~,,.--' o ~~~~ ~~ _ , Response to ' ~. Statement of Intex-cst ~ ~" ~~° °' ,~' en V ^~es~ o '3'sti~ . 1~ ''~' r eis ,. V~~ .` 6s,. eo~ 1 c. ^ ~~ em ~ ,~q . `6zn, o ~ ~ ~v". L~~ ^ 616 V '~ Parkview Terrace ~\ ^ YES 95 .~ - " ^ NO 25 ~~ ~~ ^ Undecided 7 5: ?~ .,;.~, ^ No response 14 s1 ~ `` ~n ~., ~ X721.. ,.Q V ~. ~~` ~:_' ..,`~ ~v' ~ Iv Q ~/~' ,.,`7191 ~~~ `p ~t73j~, ~. ~ g'f ' 771.9/ ~> 71~ \ ... 717 , ~ .n~`7'~ ~ ?5'~~Y, gng~~, }~;j /~I+w Q ~~ '~~ ~.,, 713 '~.. ~ V ~~ ~~7 ~ "~ t~ ,~ f' 709' ~ ., 712 V ~ .. (71 ~. ~. ~ ~ r j i v Q ~' Q W N1, _77 ~ ,,,.. ~ 801 .;1 d/ /`,: W f 1709 Q 7~ fri'~~~ ~724~' ± l y Y: .---'"".--~ .y- ~``~` ~ `o. ~ ~ r, i _ ~ t ~ 1 /~. 701 701 Q 7 Q ^ ~ 616 ~ y ` 1693 ') dr619 ~ ly'1.3... ~6y2L1 ~ ~ ~ ~ 1613: O '' t" 612 ~_ ~i N 7 i~ /ti V - ( '2 V v./" /613 ~ 7(10 \~ i 'v,I y rlf ;: 0890 ggl .. / ..~ i; (~0.~7 ~I 606 601. `~: ~ ~'.~ r. ~~` •, :V:H' hoe ~ /'~~ ~ , ~. ~6s1 ,: ~~ ~ l'! wt WIWS DR ,.,~~ ~~ ~'~~~~ ~ d ,; ~ _ o ~ q / 98 ~1'~ ~~ 61 516 ~ ~ u pp ,j ~~ Q 'CI ~I' tl Cpl pJLaJ C~ N ~ I I ~! ~ ~ m ~'_ Lf`~?930: ',~ 816-; 7281 q ~ ~~ ST F- Page 1 of 5 Marian Karr From: jehart21 @aol.com Sent: Monday, September 15, 2008 12:22 PM To: Regenia Bailey; Michael Lombardo; Eleanor M. Dilkes; Marian Karr; rsullivan@co.johnson.ia.us; tneuzil@co.johnson.ia.us; Imeyers@co.johnson.ia.us; pam_smith@harkin.senate.gov; richard_bender@harkin.senate.gov; pharney@co.johnson.ia.us; sstutsman@co.johnson.ia.us Subject: Re: Iowa City - IA -Flood Victim -Idyllwild Community Just to make myself clear.... September 15, 2008 Iowa City - IA -Idyllwild Community -Flood Victim To: Mayor Bailey, Governor Culver, Senator Harkin, Senator Grassley, FEMA (Cedar Rapids) Ms. Beth Freeman, FEMA - R. David Paulson, Sr. Legislative Assist. Mr. Richard Bender, Sr. Legislative Assist. Ms. Pamela J. Smith, Congressman Dave Loebsack, Iowa Attorney General Tom Miller, City Manager Michael Lombardo, City Attorney Eleanor Dilkes, Iowa City Council Members, Idyllwild HOA -Sally Cline, Kurt Kimmerling, FOX News -Brit Hume, Iowa News Agencies Headline: Community of (82) members -Seniors, Families and Young Professionals alike -faced with paying $18 million or more in Flood Repairs, go Bankrupt, and/or go in DEBT FOR THE REST OF OUR LIVES. No sign of Financial Relief in Sight..... How can this be happening in the Heart of America? Right now, each member of the community is being forced to pay $21,000 EACH in mold mitigation. Some only received $500 from FEMA to cover the expense. Right now, each member of the community is being forced to pay at least $5,000 in Winterization fees. No financial relief in sight. Soon, each community member will be forced to pay hundreds of thousands of dollars in re- building costs, to the Homeowners Association, for re-building of the common elements. Some will be forced into $150,000 dollars in new debt -that's on top of their current mortgages. The Community of Idyllwild needs financial relief now! Not later! The flood has destroyed our lives and neighborhood, and no-one is stepping in to help us! We need your help Mayor Bailey to cut through the bureaucracy and red tape! Do you understand the gravity of our Situation Mayor Bailey? We are not rich, and many of us cannot afford to lose our life savings, nor can we be forced into debt for the rest of our lives. Yes, we just found out that "some" grant money had been released by Governor Culver, but 9/15/2008 Page 2 of 5 even if those funds were made available to the people within the Idyllwild community, the money wouldn't even put a dent into the damage that has been done. Can you give GRANT MONEY to our Assoicaition to pay for the destrcution of our Common Elements? As we understand it, the damage done to our Common Elements, which is the bulk of the costs, would not be covered, since a Condominium Association does not qualify for any grant money. Is this true? Again, our Community sustained millions and millions of dollars in damage. The Financial and Emotional Distress is Beyond Words I'm asking you -Mayor Bailey, the Governor, and the Senator to put yourselves in the shoes of the homeowners of Idyllwild. How can the HOA, the City and State stand by and allow this atrocity to happen? Honestly, is it the intention of the State, City Builders and HOA to force a community of young professionals, seniors and others into foreclosure, bankruptcy, and/or high interest debt for life! Is that your intention? Why is our Community in this situation today? FACT - if you were to retrieve the archived City Council meeting minutes from 1990, you will discover that many concerned citizens testified to the fact that the Planning and Zoning Commission ignored all warnings, and allowed the developers and builders to go against all of the natural factors of the river and build Idyllwild in a flood zone. The Association, the City and State Need to Step-up and Do what is Right Look at the facts. Every homeowner on the first floor sustained severe/substantial damage. We more than qualify for a buyout.The cost to re-build is astronomical. Moreover, it's not a question of "if', but "when" our community will flood again. The City allowed the community to be built within a flood plain, and now our community finds itself caught in the middle - physically, emotionally, and financially. You cannot expect 92 homeowners -many seniors, families, and hardworking professionals to come up with over 18 million dollars! What is your plan? What are you going to do to help us Mayor Bailey? Governor? Senator? FEMA? How devastating it will be for our Community if we do not receive a buyout or grant money to cover the significant damage and losses. We need your help NOW! Winter is fast approaching. More Damage will be sustatined, since we cannot afford or risk re-building. Special Assessments are spiraling out of control! We Look Forward to Your Reply Most Sincerely, 9/15/2008 Page 3 of 5 -----Original Message----- From: jehart2l@aol.com To: jehart2l@aol.com; regenia-bailey@iowa-city.org; kurtkimmerling@msn.com; CLINESALLY@cs.com; michael-lombardo@iowa-city.org; eleanor-dilkes@iowa-city.org; marian-karr@iowa-city.org; rsullivan@co.johnson.ia.us; tneuzil@johnson.ia.us; lmeyers@johnson.ia.us; pam_smith@harkin.senate.gov; richard_bender@harkin.senate.gov; pharney@co.johnson.ia.us; sstutsman@co.johnson.ia.us Sent: Sun, 14 Sep 2008 2:51 pm Subject: Re: Iowa City - IA -Flood Victim -Idyllwild Community I've attached a few pictures, just as a reminder..... -----Original Message----- From: 'e, hart2~aol.com To: re~enia=baffle iowa-cit~o~; kurtkimmerling@_msn.com; CLINESALLY ~cs.com; michael- lombardo(a~iowa-city.org; eleanor-dilkes(a~iowa-city.org; marian-karr(a~iowa-city.org; rsullivan(a~co johnson.ia.us; tneuzil(~iohnson.ia.us; lmeyers ~johnson.ia.us; pam_smith(a~harkin.senate.gov; richard_bender@harkin.senate.gov; pharneyna co ~ohnson.ia.us; sstutsman(cr~co iohnson.ia.us Sent: Fri, 12 Sep 2008 11:28 pm Subject: Iowa City - IA -Flood Victim -Idyllwild Community September 12, 2008 Iowa City - IA -Idyllwild Community -Flood Vic tim Jeanne Hartman -Owner 13 Camborne Circle, Phone: 319-621-3612 To: Mayor Bailey, Governor Culver, Senator Harkin, Senator Grassley, FEMA (Cedar Rapids) Ms. Beth Freeman, FEMA - R. David Paulson, Sr. Legislative Assist. Mr. Richard Bender, Sr. Legislative Assist. Ms. Pamela J. Smith, Congressman Dave Loebsack, Iowa Attorney General Tom Miller, City Manager Michael Lombardo, City Attorney Eleanor Dilkes, Iowa City Council Members, Idyllwild HOA -Sally Cline, Kurt Kimmerling, FOX News -Brit Hume, Iowa News Agencies Note: Hard Copy Mailed to Some Addressees Horizontal Property Regime -How Can this Law Prevail in a Federally Declared Disaster? How can the State allow Iowa Code 499B and 504A to stay in tact ("horizontal property regime") or prevail, in aflood-disaster of this magnitude? Is the Governor or City Mayor going to allow and/or enable the buil der or Association to financially destroy its homeowners -retirees, families and young professionals alike? Why many at FEMA and the SBA are in Dismay - Unprecedented/Un-chartered Territory - There are second floor homeowners, in Idyllwild, that according to FEMA, sustained an average of $500 in damages, and according to the SBA anywhere from $1,000 to $6,500 in damages. Yet, according to the "horizontal property regime," Second floor homeowners will be responsible for everyone's damage equally, and that although each unit is designed differently (square footage, etc.) and each sustained more or less damage than others, each homeowner is being asked to pay $21,000 in mold abatement, $5,000 in winterization fees, and possibly $200,000 for re-building -EACH. 9/15/2008 Page 4 of 5 To top it all off, even if a homeowner wanted to get an SBA loan to pay for the very "questionable and inequitable" Special Assessments, the Home Owners Association has tied up ALL of the SBA funds in their quest fora $2 million dollar loan! A total gridlock! ! *Note: I personally requested an itemized invoice of the $21,000 mold mitigation to see the charges as t hey related to my second floor unit vs. the common areas vs. each unit's mitigation charges, yet I'm told that the detail I'm requesting, such as disposing of common area and non-common area trash isn't available. I ASK -Would the Mayor, Governor or Senator pay $226,000 plus a $150,000 mortgage plus temporary housing when he or she only sustained maybe $7,000 in total damage? If your home had only $500 in mold mitigation/damage, would you pay $21,000? What can you do to help us Mayor Bailey? Do you understand the situation we are in? Yes, we just found out today that grant money had been released by Governor Culver today, but even if those funds were made available to Idyllwild, the money wouldn't even put a dent into the damage that has been done, as explained above. Also, if you made 85k -150k you wouldn't qualify, correct? And the Condo Association does not qualify for mitigating the costs of the common element damage, correct? Reality - HOA did not Purchase Required Insurance and Many will be Forced into Financial Ruin if the HOA and HPR Prevails The financial and emotional distress is beyond words. I'm asking you -Mayor Bailey, the Governor, and the Senator to put themselves in the shoes of the 92 homeowners of Idyllwild. How can the HOA, the City and State stand by and allow this atrocity to happen? Honestly, was it the intention of the State, City Builders and HOA to force a community of young professionals, seniors and others into foreclosure and/or bankruptcy? Is that the intention of Iowa Code 499B and 504A? Why is our Community in this situation today? FACT - if you were to retrieve the archived City Council meeting minutes from 1990, you will discover that many concerned citizens testified to the fact that the Planning and Zoni ng Commission ignored all warnings, and allowed the developers and builders to go against all of the natural factors of the river and build Idyllwild in a flood zone. How can the City claim that they did not know the risk? If the builders knew the risk and the HOA was informed of the risk, why wasn't flood insurance required, or purchased? Why did our Condo Association choose not to participate in the National Flood Insurance Program (NFIP), especially when they knew that more than two-thirds of the common elements are currently sitting in a 100-year flood plain? As a personal testimony, and as an out-of--state homebuyer in 2005, I was never informed that part of our community fell into a 100-year flood plain, or for that matter, told a portion of our community fell into a 500-year flood plain. If this fact had been made known, I'm sure the VA would have required my lender to obtain flood hazard insurance. Who should be held accountable for not disclosing this information? Moreover, why were the by-laws written to forbid homeowners from purchasing insurance? The Association, the City and State Need to Step-up and Do what is Right Look at the facts. Every homeowner on the first floor sustained severe/substantial damage. The cost to re-build is astronomical. 9/15/2008 Page 5 of 5 It's not a question of "if', but "when" our community will flood again. The City allowed the community to be built within a flood plain, and now our community finds itself caught in the middle -physically, emotionally, and financially. We MUST receive financial relief soon and it must be in the form of a buyout. Where are Iowa City and State Priorities? Instead of moving our community out of harms way, it seems that the City's priority is to save the University and spend millions of dollars on raising Dubuque Street. It is heartbreaking to know that our City and State would choose traffic concerns over the safety and well being of its community members. What will happen to the more than 6 feet of water that flooded Dubuque Street? Look at where Parkview Church and the Idyllwild community is currently located -we took on four -six feet of water ourselves -it's not just a matter of more water in City Park, it's a matter of how many more feet will Parkview Church and Idyllwild take in.... 3, 6, 12 feet...it would be catastrophic. How can Idyllwild recover from this disaster? What is your plan? What are you going to do to help us Mayor Bailey? Governor? Senator? FEMA? How devastating it will be for our Community if we do not receive a buyout. I'll continue to raise my voice on behalf of the community....we need help now. Special Assessments are spiraling out of control! I Look Forward to Your Reply Most Sincerely, Jeanne Hartman 319-621-3612 JEHART21 cr aol.com Looking for spoilers and reviews on the new N season? Get_AOL's_ultimate~uide to fall_TV. Looking for spoilers and reviews on the new TV season? Get_AOL_'s_ultimate_guide to fall N. ~Image_Remoyed] mage Removed (Image Removedl Looking for spoilers and reviews on the new TV season? Get AOL's ultimate guide to fall N. 9/15/2008 4 7 Marian Karr From: Regenia Bailey [bailey@avalon.net] Sent: Monday, September 15, 2008 8:22 PM To: timo5555@aol.com Cc: Michael Lombardo; Marian Karr Subject: RE: Bars Leah, It's on our work session list-perhaps we can have an initial discussion in October so Council can give some direction to staff about what we'd be willing to consider. We have inches of proposals and memos related to alcohol. I suspect that, over the years, there have been discussions about a number of different approaches. As I understand it, the original draft for the specials ordinance was quite comprehensive, but we ended up with a much watered down version. As you know, the Council is the only body that can revisit the 21 issue within the two years following the referendum. With Connie's comment of the other evening, there may be the votes on Council to go in that direction. I agree with you that this is an excessive consumption issue and not necessarily an under-aged issue. All anyone has to do is go downtown on a football Saturday and see that excess (and if I may say, stupidity) knows no age limit. I'm interested in looking at what we have, how we're enforcing it, and what else might be necessary to limit the excessive drinking. ~BYIIGi Regenia D. Bailey 430 Church Street Iowa City, IA 52245 319.351.2068 (h) 319.321.1385 (mobile) 866.802.2854 (fax) From: timo5555@aol.com [mailto:timo5555@aol.com] Sent: Monday, September 15, 2008 8:12 PM To: bailey@avalon.net Subject: Bars Regenia I just wanted you to know I am going to pursue the excessive drinking issue with the council. I feel this has become a BIG industry here, similar to gambling, and requires a council appointed board at this time to help with regulation. I believe the vote said the people do not want 21, however I also think our citizens expect our council to start more regulation. I am going to suggest to council that a board is formed--make up of the board will be key and no one should be on it that has a underage bar. Maybe no bar owners? Several towns have these boards. I am also suggesting we have some easy ordinance changes in the near future. These could include--sizing on containers, no staff drinking, and a few more I may suggest. All schools we researched have a volume of liquor ordinances. I also think council has to be imaginative to control liquor licenses and new bars--every year we have 3-6 more. I dont know what can be done on liquor stores. To close, I believe it is time for our council to put this on the front burner to get everyone in line. All licensees should not pay a price for a irresponsible few. This is not a underage issue but a excessive drinking issue in our community. 9/16/2008 Page 2 of 2 Thanks for all you do. Please call if you have any questions. Leah Looking for spoilers and reviews on the new TV season? Get_AOL's ultimate._guid_e._to fall_N. 9/16/2008 09-23-08 4 8 Marian Karr __ From: Ross Wilburn [Wilburn.Ross@iccsd.k12.ia.us] Sent: Wednesday, September 17, 2008 12:26 PM To: Michael Lombardo; Amy Correia Cc: Marian Karr; R Bailey; Matthew J. Hayek; Mike Wright Subject: RE: 523 Church Street. FYI, please do not use my school district email account for City communications. Thank you, Ross From: Michael Lombardo [mailto:Michael-Lombardo@iowa-city.org] Sent: Wednesday, September 17, 2008 12:08 PM To: Amy Correia Cc: Marian Karr; R Bailey; Ross Wilburn; Matthew J. Hayek; Mike Wright Subject: RE: 523 Church Street. I am familiar with Xerascape and like the concept - it is something that we should give additional thought to as we discuss green initiatives. Attached is a brief white paper from Federal Heights, CO that I have referred to in the past. In terms of the specific customer service issues identified in the email, I have asked Terry to provide me a response to the issues raised and have indicated concern about our perceived lack of consistency in applying the ordinance and follow up on such complaints. I'll follow up with this as I know more. I'll say too that customer service is something that, as an organization, we seem to have taken for granted and is something that over the coming year I want to focus on. --Michael. Michael A. Lombardo City Manager 410 E. Washington Street Iowa City, Iowa 52240-1826 319-356-5010 phone 319-356-5009 fax michael-lombardo(cr~iowa-city.org From: Amy Correia Sent: Tuesday, September 16, 2008 10:04 PM To: Michael Lombardo Cc: Marian Karr Subject: FW: 523 Church Street. Michael I am interested in background on this. I haven't been by her yard, but plan to do so. Amy From: GoImlKate@aol.com [mailto:GolmlKate@aol.com] Sent: Sat 9/13/2008 3:46 PM To: Regenia Bailey; Amy Correia; Ross Wilburn; Matt Hayek; Mike Wright Subject: 523 Church Street. 9/17/2008 Page 2 of 5 Last year I planted many things in my yard. Some, like a variegated elm, and Buck Roses were expensive and unique. Others more common varieties. The philosophic is called Xeroscaping...it was started in the southwest to conserve water, but has become popular in other states such as Michigan. The idea is to plant yards using plants that are low malignance, do not require water or mowing, no yard waste, as well as many other advantages to the city. It saves gas (surprisingly "One estimate (mindfully.org)states that "the 20,000,000 small engines sold in the u.s. each year contribute about one tenth of the total U.S. mobile source hydrocarbon emissions, and are the largest single contributor to these non-road emissions." These include power blowers, rakes, and brooms"), decreasing the chemicals in the water supply, lessens the burden on landfills, as well as decreases the noise pollution. The Cardonas have a driveway on Church street next to my house, they are friends and have come over many times to admire the plants, especially the roses. There's is the only driveway near my house and they have told me there has been no problems with seeing traffic.. In fact, I receive many compliments from people walking by about how beautiful the front looks. Last Fall the City Forester came out and said I would need to take out a row of arbor vitae, and I agreed. I transplanted them to the back. This year, the city inspector, Joan, sent a letter saying I was in violation of city code...) called Joan, and she agreed to have Jann meet me at one PM on any date they wished, instead, I got a letter from the Forester, Terry, and Jann stating I was in violation of city code (note, return phone number was mistyped and unable to respond). The forester did say he would call, he did call after I called him and left a message....) have tried to call back, but have been unable to reach him. Joan told me that a summer intern had done the initial inspection (Matt?)and that it should be ok. The forester did call back, and left a message, Jann did come out after I called and reminded them that I wish to go over this with them and work out this situation. As it stands, they want everything from approximately half the way from the street and nothing left over two feet tall is to be removed. The reasoning is that it obstructs vision, which it does not....and vision of what? I can clear a two foot clearance from the sidewalk on the city side, certainly that is reasonable. But moving the roses and other plants seems a little bit much, Just this morning while driving to the store and work I noted the following: Mercy Hospitals has >6 foot grasses in between the side walk and the street..on dodge street. Motley Cow on Market Street as planted the same area with plants over two feet, in a similar manner as mine. 1302 Muscatine has Arbor vitae that are well over 15 feet tall between the street and side walk. Other case of growth between the sidewalk and street are as follows: On College street sunflowers growing over 6 feet are found at 1106, 1102, 1035, On Summit street various flowers over two feet are found at 331, 525 429, Ronalds Street 714 and 716 are worse growths than my yard. Van Buren 512, 613, 631, 620 all have plants growing greater than two feet. There are examples on every street. Why have I been single out? and I think even Mike Wrights plants might be pushing two feet.....sorry Mike. While I am working to comply, I wish to have the roses stay, and the hibiscus, as well as some of the other more 9/ 17/2008 Page 3 of 5 low growing evergreens...) have a Mounding Pine, spreading juniper, variegated juniper. The annual cosmos and grasses can easily go....as well as the banana.tree...which is sort of fun. This is ecologically sound, appreciated by the majority of people who have been by here and has added to the quality of the neighborhood....as well as being expensive and hard work. Of course the sidewalk should remain clear, and I do take responsibility for letting that get over grown and am taking measures to cut that back and keep it from happening again. I am willing to work with whomever to make it safe and enjoyable, but if I am forced to comply with the 2 foot rule, then I guess it would just be a matter of fairness to apply the law equally to others...if indeed it is such a problem...) will remove everything over two feet and mulch the area. Attached is a copy of one article on why the xeroscaping approach makes sense. Iowa City should be a leader in conservation of resources and ecologically friendly yards, instead of relying on standard issued rules that ignore important issues such as conservation of oil/gas, pollution, landfill over fill. I will gladly work with the city to find mutually agreeable solution, and comply with what is decided apron, but then I would request that this be done with fairness.....and not treating me like just a annoyance to be dismissed by a rule that is not applied equally. Thank you for your time, Tim Timothy G. Volm 523 Church Street, Iowa City, Iowa 52245 1-319-541-4939 (cell) University of Vermont Extension Department of Plant and Soil Science Summer News Article FUEL-EFFICIENT LAWNS AND LANDSCAPES Dr. Leonard Perry, Extension Professor University of Vermont With the price of gasoline and natural gas on the rise, most are looking for ways to cut their costs and save energy. If you have a lawn or garden, you may not realize just how much fossil fuels you are using. By knowing where these are used, you can look for ways to reduce consumption. This will reduce your costs, and help the environment. In a recent PPPro online newsletter Paul Tukey, editor of People, Places and Plants magazine, provides some sobering facts and helpful suggestions. Each year, a family with aone-third acre lawn will on average: "consume five gallons of gas for mowing and trimming; 9/17/2008 Page 4 of 5 "apply the equivalent of seven gallons for fertilizing; "burn up to five gallons for watering; and *consume an additional gallon for cleanup. That's 18 gallons of fuel per household. With 120 million U.S. households, that's the equivalent of almost 2.2 billion gallons of fuel used just for lawn care each year. This does not count other landscaping activities. So just how do we use so much? Yale University has estimated that the United States uses more than 600 million gallons of gas to mow and trim lawns each year -about two gallons of gas for every man, woman and child, or five gallons per household. Mowers also consume engine oil in their crankcases, and two-stroke mowers consume oil in their fuel. In addition to fuel consumption, mowers and outdoor power equipment contribute heavily to air pollution. Operating a typical (4 HP) gasoline-powered lawnmower for one hour produces as much smog-forming hydrocarbons as driving an average car between 100 and 200 miles under average conditions. Gasoline- powered string trimmers are actually more polluting than many lawn mowers. One estimate (mindfully.org) states that "the 20,000,000 small engines sold in the U.S. each year contribute about one tenth of the total U.S. mobile source hydrocarbon emissions, and are the largest single contributor to these non-road emissions." These include power blowers, rakes, and brooms. Creating synthetic nitrogen for fertilizers requires the heating of natural gas to combine atmospheric nitrogen and hydrogen into ammonia. The amount of natural gas required to make approximately 200 bags of lawn fertilizer would heat your home for a year. Each 40-pound bag contains the fossil-fuel equivalent of approximately 2.5 gallons of gasoline. Transporting these bags of fertilizer from the factory and to your home requires additional fuel. According to a California study, in many areas -especially in the West, where water must be moved great distances from reservoirs -the amount of fuel needed to pump the water is at least equal to the fuel used in mowing. So what can you do? Here are ten tips to have a "fuel-efficient" landscape. "Use an electric or non-powered push mower. An electric mower maintaining one-third of an acre for a season consumes only $3 of electricity on average. Electric mowers are 75 percent quieter than gas mowers. Push mowers, of course, consume no fuel and make little noise. "Similarly, use traditional hand rakes and brooms instead of power ones and blowers to save fuel, and at the same time reduce air and noise pollution. If you employ a landscape maintenance firm, encourage their use of these too. Minimize the need for string trimmers. Mulch along walks and around structures such as lamp posts to avoid having to trim weeds in these areas. *If you have an old mower, consider replacing it. Newer small engines run much cleaner. EPA emission standards for such engines, to be in effect by 2007, are expected to reduce ground-level ozone emissions by 70 percent or 350,000 tons each year. ''Reduce the area mowed through use of groundcovers. This is especially true in areas with water shortages. Allow parts of large areas to grow, only mowing once or twice a season, creating a natural meadow. You can still mow areas near drives and homes to maintain the more formal manicured effects in such highly visible and high traffic areas. *Save rainwater and gray water. Gray water is that water from home use, except from toilets, and can make up from 50 to 80 percent of home waste water. It comes from sinks, showers, and laundry and can be used for irrigating landscapes and lawns. `Water deeply once per week on average, rather than frequently. Drip irrigation and mulches also conserve water. Using less water saves on energy use, whether you're buying water that has to be pumped, or are paying an electric bill to pump your own. *Use natural, organic fertilizers not derived from fossil fuels. "Recycle grass clippings, mow higher and mix 5 percent clover into your lawn seed. All these help recycle nutrients back into the soil. Mulching-type mowers allow you to leave grass clippings on the lawn. If you don't have such a mower, and remove the clippings, add them to compost or use them to mulch gardens. "Compost all yard wastes, except for diseased plants and plant parts. They can go into compost piles, saving gasoline hauling such to landfills and recycle centers. If your landscape generates many twigs and other brush, consider buying or renting ahome-size brush chipper. "Finally, consider landscaping to reduce up to 25 percent of home energy consumption. Foundation plantings 9/17/2008 Page 5 of 5 can lessen heat loss from buildings. Evergreen windbreaks can reduce heating costs in winter in windy areas. Deciduous shade trees can reduce energy needs for cooling in summer. According to the Department of Energy, only three properly placed trees may Psssst...Have you heard the news? There's a new fashion blog plus the latest fall trends and hair styles at StyleList.com. 9/17/2008 EcoDrivingLaunchEmail Marian Karr From: weitzel.tim@gmail.com Sent: Tuesday, September 16, 2008 1:32 PM To: Council Subject: Check out www.EcoDrivingUSA.com! 0 Learn how to Be an EcoDriver~`~~~ This message was sent to you from w~.i.kz~l...i,m.C~gm.a.l,_soin to share E.c..oDri..v...ingUSAco.m...., aresource for learning more about saving fuel and reducing carbon dioxide right now. w.~tzeltim.C~gm...al...~om. said: "Barack suggested it, now Arnold supports it, too. Please visit this site on EcoDriving. It has great tips on saving fuel and reducing C02 emissions." 0 4 9 9/16/2008 4 10 Marian Karr From: Lindsey Kreiling [Ijkiii@aol.com] Sent: Wednesday, September 17, 2008 11:24 PM To: Council Subject: Meeting the needs of Iowa City one step at a time Dear Council, I am a student attending the university of Iowa and currently enrolled in a leadership seminar. The main focus of this class is to develop, organize, and complete a service project to benefit the community of Iowa City. As a new resident to Iowa City, I am unaware of the areas in which volunteer work, fundraising, or community service is lacking. This is where you come in! I wanted to reach out to the people behind Iowa City, helping this city run smoothly, to dig deeper and find where my help could make the greatest impact. In past years, some service projects have ranged from reading books to elementary children, to creating a mentor program for incoming freshmen at the university. There is a team of four of us trying to create a program or event that could involve Iowa City's citizens year after year to continually strengthen every element of this city If you have any ideas of some areas in our community that have been forgotten or fallen behind we would love to take the initiative to get them up and running again! If you know of any other sources that would be interested in giving their input you are more than welcome to spread the word! We want to take this from a class project to a community rebuilding event! Thank you for your time and suggestions! Lindsey Kreiling University of Iowa Lindsey-Kreiling@uiowa.edu 1 u09-23-08 5 G-) Marian Karr _. From: Liebig, Christopher J [chris-liebig@uiowa.edu] Sent: Thursday, September 18, 2008 8:57 AM To: Council Subject: new garbage collection system Dear City Councilors, I like the new garbage collection system, but I'd like to register one complaint. Apparently we are not allowed to have -- or even to purchase -- a second can. I have a family of five, and one can is simply not enough to hold a week's worth of trash for that large a group. We'll end up having several extra bags every week, which will cost us money and make the sanitation workers' jobs more difficult. Until we now we could fill three cans and pay only a dollar; under the new system, we'll be paying several dollars a week -- not because we're any more wasteful than other people, but just because we're a larger group. In effect, we are being penalized for having a family. Why is a family of five allowed no more capacity than a single person? Thanks, Chris Liebig 1822 Glendale Road 9/18/2008 ~ ~` , Iowa City Area Association of REALTORS ..~ September 22, 2008 ~ ,,~ =, --~ ~ Iowa City City Council ~= ` y , ;o: d .~^ " y I 410 East Washington Street ~ ` ~'~ ©~ ~~ ='= Iowa City, IA 52240 ~. „ v ~? Dear members of the Iowa City Council, ~ ~ "' Please accept this letter of support by the Iowa City Area Association of REALTORS® (ICAAR) Board of Directors. The initial shock of the 2008 Flood has begun to wear off, and our community finds itself faced with a lazge dilemma: what to do with the flood-affected homes, neighborhoods, and azeas? As community members, business people, and real property professionals, we support the City of Iowa City in their plan to move forward while recognizing that there is no perfect answer or solution. In any plan of action, we aze faced with unknowns, and sometimes the "not knowing" causes us to do nothing. In this instance, however, there are dire consequences if we, as a community at large and individual homeowners, do nothing. Therefore, it is time for all of us to move forward and become healthy again. There are not many options available to us with which to accomplish this goal. After careful review, the ICAAR Board of Directors has identified the following objectives and a course of action. 1. The Iowa River is an integral part of our community. It was here first, and both Iowa City and Coralville were formed around the river. Let's embrace the river, its beauty and potential, while recognizing that we need to be proactive by not setting ourselves up for failure again when, not if, the river breaches its banks. 2. The solution for our affected areas must be a community solution, not just a neighborhood or individual homeowner's problem to solve. We are not interested in "who's to blame." For us, that question is off the table. We aze interested in restoring the health of our community, and to do that we must move forward. Without a solution, we feel all the "blighted" neighborhoods will be hard to explain, not only to ourselves, but to others looking towazd a move to our azea. The ramifications of not moving forward are cost prohibitive, and the uncomfortable truth is that it is not possible in any way, shape or form for any of us to not in some way be financially accountable. It has truly been a community disaster. We have formed an economic decision to support a program called the Hazard Mitigation Grant Program. It is a voluntary program available to eligible applicants after a I; 438 Highway 1 West 319-338-6460 phone e-mail: icaar@icaar.org Iowa City, IA 52246 319-338-6957.f~' web site: icaar.org Presidential disaster declaration. A homeowner must apply with the city as facilitator, and this application must be done within 15 years of the declaration. We encourage homeowners to look into and apply to this program as soon as possible. Once the city has received homeowners' applications, the city formally submits the project applications to FEMA for funding. The compensation to the homeowner will be 110% of the pre-flood tax assessed value. Of the 110% of tax assessed value cost, the city will incur 15% of the cost and the state of Iowa covers 10%. Homes purchased through this grant will belong to the city, must be torn down, and will remain as open public space forever. 4. The Iowa River has been a serious consideration in several areas of our community twice in the last fifteen years. Should we rebuild in these areas, it would be impossible to explain, given our past, how we could let this happen again. The ICAAR Board of Directors recognizes that, even with the assistance of the Hazard Mitigation Grant Program, unknowns will present themselves. How the land should be habilitated? What costs will be associated with rehabilitation? And that's OK. We need to be prepared for the questions that will surface and creative with our answers. In typical Iowa fashion, it's a case of "let's get over it and get the job done." We are proud to call this area of Iowa "home," fully noting and appreciating the unpredictability of weather. Moving forward and planning for a great future awaits each one of us. Let's make it happen. Sincerely, Members of the Board of Directors of the Iowa City Area Association of REALTORS® im Ryan Bec artel Jeff D 1 Terri Larson President President-Elect Vice President ecretary/Treasurer Michele Todd Sall eff Brandstatter Case Cline dberg ..~~~~"~ ar John Karen Kamps Marshall Peterson Cc: Iowa City Press-Citizen, Cedar Rapids Gazette ~ ~' .~ - ~-; , ~? t~ -~_ e.,a -:ate '.~ l.ll A s- ~~ ~3 c~~ ORDINANCE CHANGES AND SUGGESTIONS 1. Expand the ordinance on specials to include a limit on size of hard liquor drinks. I would suggest 1 b oz. (pint) size. I would also put some sort of drink to mix ratio to avoid all liquor drinks. 2. An alcohol limit for servers, bartenders, and bouncers while working. This could be a zero tolerance or a .08 as is for drunk driving. 3. A limit on table service for bottle of hard alcohol. We would not want to limit wine but limit alcohol bottles at bars that allow under 21 in their establishments. 4. Limit the 19 ordinance exception to only restaurants/bars that close early and are not open to tam. Some bars have exceptions and use it for greek parties to allow under 19 year olds. s. Limit specials to no under cost. 6. Communicate to the fire dept the need for compliance checks late night when bars are busy. ~. Work with the police dept to improve checks, undercover, as well as compliance checks. 8. A CITY ALCOHOL COMMISSION TO PROVIDE OVERSIGHT ON THIS INDUSTRY. THIS WOULD INCLUDE ESTABLISHING A CLEAR SET OF RULES AND REGULATIONS FOR ANYONE WANTING A LIQUOR LICENSE IN OUR TOWN. THIS COMMISSION COULD CONTINUE SOME OF THE WORK OF THE ALCOHOL BOARD BUT HAVE SOME AUTHORITY FROM THE COUNCIL. Leah Cohen 52-483 CITY BUDGET AMENDMENT AND CERTIFICATION RESOLUTION To the Auditor of JOHNSON County, Iowa: The City Council of Iowa City in said County/Counties met on 9123/08 ,at the place and hour set in the notice, a copy of which accompanies this certificate and is certified as to publication. Upon taking up the proposed amendment, it was considered and taxpayers were heard for and against the amendment. The Council, after hearing all taxpayers wishing to be heard and considering the statements made by them, gave final consideration to the proposed amendment(s) to the budget and modifications proposed at the hearing, if any. thereupon, the following resolution was introduced. RESOLUTION No. 08-288 A RESOLUTION AMENDING THE CURRENT BUDGET FOR THE FISCAL YEAR ENDING JUNE 30 2009 (AS AMENDED LAST ON •) Be it Resolved by the Council of the City of Iowa City Section 1. Following notice published 9/12/08 and the public hearing held, 9/23/08 the current budget (as previously amended) is amended as set out herein and in the detail by fund type and activity that supports this resolution which was considered at that hearing: Total Budget as certified or last amended Current Amendment Total Budget after Current Amendment Revenues 8 Other Financing Sources Taxes Levied on Property 1 43,167,738 0 43,167,738 less: Uncollectted Property Taxes-levy Year 2 0 0 0 Net Current Property Taxes 3 43,167,738 0 43,167,738 Delinquent Property Taxes 4 0 0 0 TIF Revenues 5 2,477,860 0 2,477,860 Other City Taxes 6 1,586,422 0 1,586,422 Licenses 8 Permits 7 1,308,040 0 1,308,040 Use of Money and Property 8 5,503,674 0 5,503,674 Inter overnmental 9 22,536,992 11,386,124 33,923,116 Charges for Services 10 40,342,171 0 40,342,171 Special Assessments 11 0 0 0 Miscellaneous 12 5,698,190 -160,076 5,538,114 Other Financing Sources 13 58,783,348 6,698,714 65,482,062 Total Revenues and Other Sources 14 181;404,435 17,924,762 199,329,197 Expenditures >L Other Financing Uses Public safety 15 18,115,753 7,477,504 25,593,257 Public Works 16 12,577,143 98,876 12,676,019 Health and Social Services 17 0 0 0 Culture and Recreation 18 11,331,623 190,447 11,522,070 Community and Economic Development 19 5,050,971 2,222,690 7,273,661 General Government 20 8,182,790 76,863 8,259,653 Oebt service 21 12,661,945 0 12,661,945 Capital Projects 22 12,863,191 11,039,547 23,902,738 Total GovernmentACtivities Expenditures 23 80,783,416 21,105,927 101,889,343 Business Type /Enterprises 24 60,429,416 3,919,233 64,348,649 Total Gov Activities & Business Expenditures 25 141,212,832 25,025,160 166,237,992 Transfers Out 26 49,163,540 6,698,714 55,862,254 Total Expenditures/Transfers Out 27 190,376,372 31,723,874 222,100,246 Excess Revenues 8 Other Sources Over (Under) Expenditures/Transfers Out Fiscal Year 28 -8,971,937 -13,799,112 -22,771,049 Continuing Appropriation 29 0 N/A 0 Beginning Fund Balance July 1 30 104,585,714 20,873,822 125,459,536 Ending Fund Balance June 30 31 95,613,777 7,074,710 102,688,487 Passed this 23rd IDay) ~~ ~. ~~~ Signature City Clerk/Fiaaaco-8#ieer- day of Septemb 2008 ontl/Yeer) ~ Signature - 2 - Mayor Resolution No. 08-288 Page 2 It was moved by Wilburn and seconded by O'Donnell the Resolution be adopted, and upon roll call there were: AYES: NAYS: ABSENT: x ~- x x x X x Bailey Champion Correia Hayek O'Donnell Wilburn Wright wpdata/glossary/resolution-ic.doc ^~,®~ CITY OF IOWA CITY 7 ~ ~~~~~~~ MEMO Date: September 12, 2008 To: City Manager /City Council From: Deb Mansfield, Budget Management Analyst ~,p,~ / ~ idNU~~ Re: FY 2009 Budget Amendment Attached is the public hearing notice and supporting documentation to amend the FY2009 budget. The public hearing notice appeared in the Iowa City Press Citizen on September 12, 2008. The public hearing is scheduled for September 23, 2008. The primary purposes of this budget amendment are to: 1. Continue budget authority for capital improvement projects authorized in FY2008. 2. Carryover department's budget authority to pay for expenditures authorized in FY2008 which were either encumbered by purchase order at 6/30/08 or are delayed until FY2009. 3. Establish budget authority for expenditures and reimbursements related to the summer 2008 flood. 4. Establish budget authority for purchase of land for economic development. Intergovernmental revenues and Other Financing Sources (Transfers In) are the majority of the revenue amendment. Both are related to carryover of Capital Improvement Projects. Intergovernmental revenue also has an estimate of $6.035 million for FEMA and state revenues related to the flood. Total Revenues and Other Financing Sources amendment is $17,924,762, line 14. Expenditures and Other Financing Sources include amendments to carryover budget authority to pay open purchase orders at 6/30/08. Capital Improvement Projects carryover is all of line 22 "Capital Projects", most of line 24 "Business Type /Enterprises" and line 26 "Transfers Out". Public Safety includes an amendment of $7,213,405 for flood expenditures in FY09. Economic Development includes a budget amendment for $2 million for land acquisition. Total Expenditures /Transfers Out are $31,723,874, line 27. Please contact me or Kevin O'Malley, Finance Director with any questions. r~n~8 September 23 ,2~0g The City Council of Iowa City, Iowa, met in regular session, in the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, at ~ : OO o'clock p .M., on the above date. There were present Mayor Bailey , in the chair, and the following named Council Members: Bailey, champion, Correia, Hayek, O'Donnell, Wilburn, Wright Absent: None ******* -1- .~.09 ~$_ 8 Council Member Wright moved that the form of Tax Exemption Certificate be placed on file and approved. Council Member Hayek seconded the motion and the roll being called thereon, the vote was as follows: AYES: Bailey, Champion, Correia, Hayek, O'Donnell, Wilburn, Wright NAYS: None Council Member o' Donnell moved that the form of Continuing Disclosure Certificate be placed on file and approved. Council Member Hayek seconded the motion and the roll being called thereon, the vote was as follows: AYES: Bailees, hampion, Correia,~ygk,, O'Donnell, Wilburn, Wright NAYS: None Council Member Champion introduced the following Resolution entitled "RESOLUTION APPROVING AND AUTHORIZING A FORM OF LOAN AGREEMENT AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF $17,005,000 GENERAL OBLIGATION REFUNDING CAPITAL LOAN NOTES, SERIES 2008B, AND LEVYING A TAX TO PAY THE NOTES" and moved that it be adopted. Council Member Wright seconded the motion to adopt, and the roll being called thereon, the vote was as follows: AYES: Hayek, O'Donnell, Wilburn, Wright, Bailey, Champion, Correia NAYS: None -2- Whereupon, the Mayor declared said Resolution duly adopted as follows: RESOLUTION APPROVING AND AUTHORIZING A FORM OF LOAN AGREEMENT AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF $17,005,000 GENERAL OBLIGATION REFUNDING CAPITAL LOAN NOTES, SERIES 2008B, AND LEVYING A TAX TO PAY THE NOTES WHEREAS, the Issuer is duly incorporated, organized and exists under and by virtue of the laws and Constitution of the State of Iowa; and WHEREAS, the Issuer is in need of funds to pay costs of the refunding of the outstanding Series 1998, 1999 and 2000 General Obligation Bonds, dated April 1, 1998, March 15, 1999 and July 1, 2000, respectively, for an essential corporate purpose, and it is deemed necessary and advisable that a form of Loan Agreement be approved and authorized and General Obligation Capital Loan Notes, Series 2008, in the amount of $17,005,000 be issued for said purpose; and WHEREAS, pursuant to notice published as required by Sections 384.24, 384.24A and 384.25 of the City Code of Iowa, as amended, this Council has held a public meeting and hearing upon the proposal to institute proceedings for the issuance of not to exceed $18,500,000 General Obligation Refunding Capital Loan Notes, and the Council is therefore now authorized to proceed with the issuance of $17,005,000 of the Notes: NSW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, 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: • "Authorized Denominations" shall mean $5,000 or any integral multiple thereof. • "Beneficial Owner" shall mean the person in whose name such Note is recorded as the beneficial owner of a Note by a Participant on the records of such Participant or such person's subrogee. • "Cede & Co." shall mean Cede & Co., the nominee of DTC, and any successor nominee of DTC with respect to the Notes. -3- • Continuing Disclosure Certificate" shall mean that certain Continuing Disclosure Certificate executed by the Issuer and dated the date of issuance and delivery of the Notes, as originally executed and as it may be amended from time to time in accordance with the terms thereof. • "Depository Notes" shall mean the Notes as issued in the form of one global certificate for each maturity, registered in the Registration Books maintained by the Registrar in the name of DTC or its nominee. • "DTC" shall mean The Depository Trust Company, New York, New York, a limited purpose trust company, or any successor book-entry securities depository appointed for the Notes. • "Issuer" and "City" shall mean the City of Iowa City, Iowa. • "Loan Agreement" shall mean a Loan Agreement between the Issuer and a lender or lenders in substantially the form attached to and approved by this Resolution. • "Note Fund" shall mean the fund required to be established by Section 4 of this Resolution. • "Notes" shall mean $17,005,000 General Obligation Refunding Capital Loan Notes, Series 2008B, authorized to be issued by this Resolution. • "Participants" shall mean those broker-dealers, banks and other financial institutions for which DTC holds Notes as securities depository. • "Paying Agent" shall mean the City Controller, 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. • "Project" shall mean paying the costs of the refunding of the outstanding Series 1998, 1999 and 2000 General Obligation Bonds, dated April 1, 1998, March 15, 1999 and July 1, 2000, respectively. • "Rebate Fund" shall mean the fund so defined in and established pursuant to the Tax Exemption Certificate. -4- • "Refunded Bonds" shall mean $2,750,000 of the $8,500,000 General Obligation Bonds, Series 1998 dated April 1, 1998; $4,750,000 of the $9,000,000 General Obligation Bonds, Series 1999, dated March 15, 1999 and $9,580,000 of the $14,310,000 General Obligation Bonds, Series 2000, dated July 1, 2000. • "Registrar" shall mean the City Controller of Iowa City, Iowa, 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. • "Representation Letter" shall mean the Blanket Issuer Letter of Representations executed and delivered by the Issuer to DTC on file at DTC. • "Resolution" shall mean this resolution authorizing the issuance of the Notes. • "Tax Exemption Certificate" shall mean the Tax Exemption Certificate executed by the Treasurer and delivered at the time of issuance and delivery of the Notes. • "Treasurer" shall mean the Finance Director 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. The form of Loan Agreement in substantially the form attached to this Resolution is hereby approved and is authorized to be executed and issued on behalf of the Issuer by the Mayor and attested by the City Clerk. Section 3. Lew and Certification of Annual Tax• Other Funds to be Used. (a) Lew of Annual Tax. That for the purpose of providing funds to pay the principal and interest of the Notes hereinafter authorized to be issued, there is hereby levied for each future year the following direct annual tax on all of the taxable property in Iowa City, Iowa, to-wit: -5- FISCAL YEAR (JULY 1 TO JUNE 30) AMOUNT YEAR OF COLLECTION $2,197,586 2008/2009 $2,405,062 2009/2010 $2,367,613 2010/2011 $2,324,562 2011/2012 $2,271,063 2012/2013 $1,677,412 2013/2014 $1,656,263 2014/2015 $1,639,300 2015/2016 $1,622,675 2016/2017 $1,602,93 8 2017/2018 (NOTE: For example the levy to be made and certified against the taxable valuations of January 1, 2007, will be collected during the fiscal year commencing July 1, 2008). (b) Resolution to be Filed With County Auditor. A certified copy of this Resolution shall be filed with the County Auditor of Johnson County, Iowa, and the Auditor is hereby instructed in and for each of the years as provided, to levy and assess the tax hereby authorized in Section 3 of this Resolution, in like manner as other taxes are levied and assessed, and such taxes so levied in and for each of the years aforesaid be collected in like manner as other taxes of the City are collected, and when collected be used for the purpose of paying principal and interest on said Notes issued in anticipation of the tax, and for no other purpose whatsoever. (c) Additional City Funds Available. Principal and interest coming due at anytime when the proceeds of said tax on hand shall be insufficient to pay the same shall be promptly paid when due from current funds of the City available for that purpose and reimbursement shall be made from such special fund in the amounts thus advanced. Section 4. Note Fund. Said tax shall be assessed and collected each year at the same time and in the same manner as, and in addition to, all other taxes in and for the City, and when collected they shall be converted into. a special fund within the Debt Service Fund to be known as the "GENERAL OBLIGATION REFUNDING CAPITAL LOAN NOTE FUND 2008B NO. 2" (the "Note Fund"), which is hereby pledged for and shall be used only for the payment of the principal of and interest on the Notes hereinafter -6- authorized to be issued; and also there shall be apportioned to said fund its proportion of taxes received by the City from property that is centrally assessed by the State of Iowa. Section 5. An_nlication of Note Proceeds. Proceeds of the Notes other than accrued interest except as may be provided below shall be expended for the purposes of issuance. Proceeds invested shall mature before the date on which the moneys are required for payment of principal and interest on the Refunded Bonds. Accrued interest, if any, shall be deposited in the Note Fund. Section 6. Investments of Note Fund Proceeds. All moneys shall be invested in investments permitted by Chapter 12B, Code of Iowa, 2007 (formerly Chapter 452, Code of Iowa, as amended) or deposited in financial institutions which are members of the Federal Deposit Insurance Corporation and the deposits in 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 Chapter 12C of the Code of Iowa, 2007, as amended or otherwise by a valid pledge of direct obligations of the United States Government having an equivalent market value. All such interim investments shall mature before the date on which the moneys are required for payment of principal of or interest on the Notes as herein provided. Section 7. Note Details, Execution and Redemption. (a) Note Details. General Obligation Refunding Capital Loan Notes, Series 2008B, of the City in the total amount of $17,005,000 shall be issued to evidence the obligations of the Issuer under the Loan Agreement pursuant to the provisions of Sections 384.24, 384.24A and 384.25 of the City Code of Iowa, as amended, for the aforesaid purpose. The Notes shall be issued in one or more series and shall be on a parity and secured equally and ratably from the sources provided in Section 3 of this Resolution. The Notes shall be designated "GENERAL OBLIGATION REFUNDING CAPITAL LOAN NOTE, SERIES 2008B", be dated October 15, 2008, and bear interest from the date thereof, until payment thereof, at the office of the Paying Agent, said interest payable on June 1, 2009, and semiannually thereafter on the 1st day of June and December in each year until maturity at the rates hereinafter provided. The Notes shall be executed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the City Clerk, and impressed or printed 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 -7- premium, if any, shall be payable at the office of the Paying Agent by mailing of a check to the registered owner of the Note. The Notes shall be in the denomination of $5,000 or multiples thereof and shall mature and bear interest as follows: Interest Principal Maturity Rate Amount June 1st 3.000% $1,855,000 2009 3.000% $1,915,000 2010 3.000% $1,93 5,000 2011 3.000% $1,950,000 2012 3.000% $1,955,000 2013 3.250% $1,420,000 2014 3.250% $1,445,000 2015 3.500% $1,475,000 2016 3.625% $1,510,000 2017 3.750% $1,545,000 2018 (b) Redemption. Notes maturing after June 1, 2016, may be called for redemption by the Issuer and paid before maturity on said date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Thirty days' notice of redemption shall be given by ordinary mail to the registered owner of the Note. Failure to give such notice by mail to any registered owner of the Notes or any defect therein shall not affect the validity of any proceedings for the redemption of the Notes. All notes or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the notes to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of notes to be called has been reached. Section 8. Issuance of Notes in Book-Entry Form; Replacement Notes. (a) Notwithstanding the other provisions of this Resolution regarding registration, ownership, transfer, payment and exchange of the Notes, unless the Issuer -8- determines to permit the exchange of Depository Notes for Notes in the Authorized Denominations, the Notes shall be issued as Depository Notes in denominations of the entire principal amount of each maturity of Notes (or, if a portion of said principal amount is prepaid, said principal amount less the prepaid amount); and such Depository Notes shall be registered in the name of Cede & Co., as nominee of DTC. Payment of semi-annual interest for any Depository Note shall be made by wire transfer or New York Clearing House or equivalent next day funds to the account of Cede & Co. on the interest payment date for the Notes at the address indicated in or pursuant to the Representation Letter. (b) With respect to Depository Notes, neither the Issuer nor the Paying Agent shall have any responsibility or obligation to any Participant or to any Beneficial Owner. Without limiting the immediately preceding sentence, neither the Issuer nor the Paying Agent shall have any responsibility or obligation with respect to (i) the accuracy of the records of DTC or its nominee or of any Participant with respect to any ownership interest in the Notes, (ii) the delivery to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any notice with respect to the Notes, (iii) the payment to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any amount with respect to the principal of, premium, if any, or interest on the Notes, or (iv) the failure of DTC to provide any information or notification on behalf of any Participant or Beneficial Owner. The Issuer and the Paying Agent may treat DTC or its nominee as, and deem DTC or its nominee to be, the absolute owner of each Note for the purpose of payment of the principal of, premium, if any, and interest on such Note, for the purpose of all other matters with respect to such Note, for the purpose of registering transfers with respect to such Notes, and for all other purposes whatsoever (except for the giving of certain Noteholder consents, in accordance with the practices and procedures of DTC as may be applicable thereto). The Paying Agent shall pay all principal of, premium, if any, and interest on the Notes only to or upon the order of the Noteholders as shown on the Registration Books, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to the principal of, premium, if any, and interest on the Notes to the extent so paid. Notwithstanding the provisions of this Resolution to the contrary (including without limitation those provisions relating to the surrender of Notes, registration thereof, and issuance in Authorized Denominations), as long as the Notes are Depository Notes, full effect shall be given to the Representation Letter and the procedures and practices of DTC thereunder, and the Paying Agent shall comply therewith. -9- (c) Upon (i) a determination by the Issuer that DTC is no longer able to carry out its functions or is otherwise determined unsatisfactory, or (ii) a determination by DTC that the Notes are no longer eligible for its depository services or (iii) a determination by the Paying Agent that DTC has resigned or discontinued its services for the Notes, if such substitution is authorized by law, the Issuer shall (A) designate a satisfactory substitute depository as set forth below or, if a satisfactory substitute is not found, (B) provide for the exchange of Depository Notes for replacement Notes in Authorized. Denominations. (d) To the extent authorized by law, if the Issuer determines to provide for the exchange of Depository Notes for Notes in Authorized Denominations, the Issuer shall so notify the Paying Agent and shall provide the Registrar with a supply of executed unauthenticated Notes to be so exchanged. The Registrar shall thereupon notify the owners of the Notes and provide for such exchange, and to the extent that the Beneficial Owners are designated as the transferee by the owners, the Notes will be delivered in appropriate form, content and Authorized Denominations to the Beneficial Owners, as their interests appear. (e) Any substitute depository shall be designated in writing by the Issuer to the Paying Agent. Any such substitute depository shall be a qualified and registered "clearing agency" as provided in Section 17A of the Securities Exchange Act of 1934, as amended. The substitute depository shall provide for (i) immobilization of the Depository Notes, (ii) registration and transfer of interests in Depository Notes by book entries made on records of the depository or its nominee and (iii) payment of principal of, premium, if any, and interest on the Notes in accordance with and as such interests may appear with respect to such book entries. Section 9. 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 City Controller is hereby appointed as 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 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. -10- (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. (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. (g) Registration and Transfer Fees. The Registrar may furnish to each owner, at the Issuer's expense, one note for each annual maturity. The Registrar shall furnish additional Notes in lesser denominations (but not less than the minimum denomination) to an owner who so requests. Section 10. 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 11. 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 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. Payment of principal shall only be made upon surrender of the Note to the Paying Agent.. -12- Section 12. Execution Authentication and Deliver~of the Notes. The Mayor and 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 Purchaser. No Note shall be valid or obligatory for any purpose or shall be 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 13. Right to Name Substitute Pang Agent or Re i~ s, tray. Issuer reserves the right to name a substitute, successor Registrar or Paying Agent upon giving prompt written notice to each registered noteholder. -13- Section 14. Form of Note. Notes shall be printed in substantial compliance with standards proposed by the American Standards Institute substantially in the form as follows: (7) (g) (9) (9a) (10) (Continued on the back of this Note} FIGURE 1 (Front) -14- (10) (16) (Continued) FIGURE 2 (Back) -15- The text of the Notes to be located thereon at the item numbers shown shall be as follows: Item I, figure I = "STATE OF IOWA" "COUNTY OF JOHNSON" Item 2, figure 1 Item 3, figure 1 Item 4, figure 1 Item 5, figure 1 Item 6, figure 1 Item 7, figure 1 "CITY OF IOWA CITY" "GENERAL OBLIGATION REFUNDING CAPITAL LOAN NOTE"~ "SERIES 2008B" "ESSENTIAL CORPORATE PURPOSE" = Rate: = Maturity: = Note Date: October 15, 2008 = Cusip No.: _ _ "Registered" = Certificate No. Item 8, figure 1 = Principal Amount: $ Item 9, figure 1 = The City of Iowa City, 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 Item 9A, figure 1 = (Registration panel to be completed by Registrar or Printer with name of Registered Owner). Item 10, figure 1 = or registered assigns, the principal sum of ~j~rincipal amount written out) THOUSAND DOLLARS in lawful money of the United States of America, on the maturity date shown above, only upon presentation and surrender hereof at the office of the City Controller, Paying Agent of this issue, or its successor, with interest on said sum from the date hereof until paid at the rate per annum specified above, payable on June 1, 2009, and semiannually thereafter on the 1st day of June and December in each year. 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 1 Sth day preceding such interest payment date. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. -16- This Note is issued pursuant to the provisions of Sections 384.24, 384.24A and 384.25 of the City Code of Iowa, as amended, for the purpose of paying costs of the refunding of the outstanding Series 1998, 1999 and 2000 General Obligation Bonds, dated April 1, 1998, March 15, 1999 and July 1, 2000, respectively, and in order to evidence the obligations of the Issuer under a certain Loan Agreement dated 2008, in conformity to a Resolution of the Council of the Issuer 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 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 Agreement and Resolution. Unless this certificate is presented by an authorized representative of The Depository Trust Company, a limited purpose trust company ("DTC"), to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. Notes maturing after June 1, 2016, may be called for redemption by the Issuer and paid before maturity on said date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Thirty days' notice of redemption shall be given by ordinary mail to the registered owner of the Note. Failure to give such notice by mail to any registered owner of the Notes or any defect therein shall not affect the validity of any proceedings for the redemption of the Notes. All notes or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the notes to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of notes to be called has been reached. -17- Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the City Controller, the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Note at the office of the Registrar as designated below, 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. 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; that provision has been made for the levy of a sufficient continuing annual tax on all the taxable properly within the territory of the Issuer for the payment of the principal and interest of this Note as the same will respectively become due; that the faith, credit, revenues and resources and all the real and personal property of the Issuer are irrevocably pledged for the prompt payment hereof, both principal and interest, and the total indebtedness of the Issuer including this Note, does not exceed the constitutional or statutory limitations. IN TESTIMONY WHEREOF, the Issuer by its Council, has caused this Note to be signed by the facsimile signature of its Mayor and attested by the facsimile signature of its City Clerk, with the seal of said City printed hereon, and to be authenticated by the manual signature of an authorized representative of the Registrar, the City Controller, Iowa City, Iowa. Item 1 I, 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 Controller. CITY CONTROLLER, Registrar By: Authorized Signature Item 13, figure 1 =Registrar and Transfer Agent: City Controller Paying Agent: City Controller -18- SEE REVERSE FOR CERTAIN DEFINITIONS Item 14, figure 1 = (Seal) Item 15, figure 1 = [Signature Block] CITY OF IOWA CITY, IOWA By: (facsimile si ng ature) Mayor ATTEST: By: (facsimile si ng_ature~ 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 (Person(s) executing this Assignment sign(s) here) SIGNATURE ) GUARANTEED) 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 -19- 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.......... (Gust) (Minor) under Iowa Uniform Transfers to Minors Act ................ (State) ADDITIONAL ABBREVIATIONS MAY BE ALSO USED THOUGH NOT IN THE ABOVE LIST Section 15..Contract Between Issuer and Purchaser. This Resolution shall constitute a contract between said City and the purchaser of the Notes. -20- Section 16. Non-Arbitrage Covenants. The Issuer reasonably expects and covenants that no use will be made of the proceeds from the issuance and sale of the Notes issued hereunder which will cause any of the Notes to be classified as arbitrage bonds within the meaning of Section 148(a) and (b) of the Internal Revenue Code of the United States, and that throughout the term of the Notes it will comply with the requirements of said statute and regulations issued thereunder. To the best knowledge and belief of the Issuer, there are no facts or circumstances that would materially change the foregoing statements or the conclusion that it is not expected that the proceeds of the Notes will be used in a manner that would cause the Notes to be arbitrage bonds. Without limiting the generality of the foregoing, the Issuer hereby agrees to comply. with the provisions of the Tax Exemption Certificate and the provisions of the Tax Exemption Certificate are hereby incorporated by reference as part of this Resolution. The Treasurer is hereby directed to make and insert all calculations and determinations necessary to complete the Tax Exemption Certificate in all respects and to execute and deliver the Tax Exemption Certificate at issuance of the Notes to certify as to the reasonable expectations and covenants of the Issuer at that date. Section 17. Severability Clause. If any section, paragraph, clause or provision of this Resolution be held invalid, such invalidity shall not affect any of the remaining provisions hereof, and this Resolution shall become effective immediately upon its passage and approval. Section 18. Continuing~Disclosure. The Issuer hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate, and the provisions of the Continuing Disclosure Certificate are hereby incorporated by reference as part of this Resolution and made a part hereof. Notwithstanding any other provision of this Resolution, failure of the Issuer to comply with the Continuing Disclosure Certificate shall not be considered an event of default under this Resolution; however, any holder of the Notes or Beneficial Owner may take such actions as may be necessary and appropriate, including seeking specific performance by court order, to cause the Issuer to comply with its obligations under the Continuing Disclosure Certificate. For purposes of this Section, "Beneficial Owner" means any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Notes (including persons holding Notes through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Notes for federal income tax purposes. Section 19. Additional Covenants, Representations and Warranties of the Issuer. The Issuer certifies and covenants with the purchasers and holders of the Notes from time -21- to time outstanding that the Issuer through its officers, (a) will make such further specific covenants, representations and assurances as may be necessary or advisable; (b) comply with all representations, covenants and assurances contained in the Tax Exemption Certificate, which Tax Exemption Certificate shall constitute a part of the contract between the Issuer and the owners of the Notes; (c) consult with bond counsel (as defined in the Tax Exemption Certificate); (d) pay to the United States, as necessary, such sums of money representing required rebates of excess arbitrage profits relating to the Notes; (e) file such forms, statements and supporting documents as may be required and in a timely manner; and (f) if deemed necessary or advisable by its officers, to employ and pay fiscal agents, financial advisors, attorneys and other persons to assist the Issuer in such compliance. Section 20. Amendment of Resolution to Maintain Tax Exemption. This Resolution may be amended without the consent of any owner of the Notes if, in the opinion of bond counsel, such amendment is necessary to maintain tax exemption with respect to the Notes under applicable Federal law or regulations. Section 21. Repeal of Conflicting Resolutions or Ordinances. All ordinances and resolutions and parts of ordinances and resolutions in conflict herewith are hereby repealed. PASSED AND APPROVED this 23rd day of September , 2008. ATTEST: _ ~ City erk -22- CIG-3 9/91 CERTIFICATE STATE OF IOWA ) SS COUNTY OF JOHNSON ) I, the undersigned City Clerk of Iowa City, 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 25th day of September , 2008. City Cler ,Iowa City, Iowa SEAL 588869. I \W P 10714.090 v~ ~' September 23 ,2~~g The City Council of Iowa City, Iowa, met in regular session, in the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, at ~ : 00 o'clock P .M., on the above date. There were present Mayor Bailey , in the chair, and the following named Council Members: Bailey, Champion, Correia, Hayek, O'Donnell, Wilburn, Wright Absent: None -1- ~...~ Council Member Hayek moved that the form of Tax Exemption Certificate be placed on file and approved. Council Member O'Donnell seconded the motion and the roll being called thereon, the vote was as follows: AYES; Bailey, Champion, Correia, Hayek, O'Donnell, Wilburn, Wright NAYS: None Council Member Hayek moved that the form of Continuing Disclosure Certificate be placed on file and approved. Council Member Wright seconded the motion and the roll being called thereon, the vote was as follows: AYES: Bailey Champion, Correia. Hayek, O'Donnell, Wilburn, Wright NAYS: None Council Member Hayek introduced the following Resolution entitled "A RESOLUTION APPROVING AND AUTHORIZING A FORM OF LOAN AGREEMENT AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $24,280,000 SEWER REVENUE REFUNDING CAPITAL LOAN NOTES, SERIES 2008C, OF THE CITY OF IOWA CITY, IOWA, UNDER THE PROVISIONS OF THE CITY CODE OF IOWA, AND PROVIDING FOR A METHOD OF PAYMENT OF THE NOTES", and moved its adoption. Council Member o ~ Donnell seconded the motion to adopt. The roll was called and the vote was: AYES: O'Donnell, Wilburn, Wright, Bailey, Champion, Correia, Hayek NAYS: None -2- Whereupon the Mayor declared the following Resolution duly adopted: Resolution No. 08-290 A RESOLUTION APPROVING AND AUTHORIZING A FORM OF LOAN AGREEMENT AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $24,280,000 SEWER REVENUE REFUNDING CAPITAL LOAN NOTES, SERIES 2008C, OF THE CITY OF IOWA CITY, IOWA, UNDER THE PROVISIONS OF THE CITY CODE OF IOWA, AND PROVIDING FOR A METHOD OF PAYMENT OF THE NOTES WHEREAS, the City Council of the City of Iowa City, 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 Municipal Sewer Utility, sometimes hereinafter referred to as the "System", and the revenues have not been pledged and are available for the payment of Sewer Revenue Refunding Capital Loan Notes, Series 2008C, subject to the following premises; and WHEREAS, Issuer proposes to issue its Sewer Revenue Refunding Capital Loan Notes, Series 2008C, to the extent of $24,280,000, for the purpose of defraying the costs of the project as set forth in Section 3 of this Resolution; and, it is deemed necessary and advisable and in the best interests of the City that a form of Loan Agreement be approved and authorized; and WHEREAS, there have been heretofore issued certain sewer revenue bonds, notes or other obligations, part of which remain outstanding and are a lien on the net revenues of the System (defined herein as the "Outstanding Obligations"); and WHEREAS, in the resolutions authorizing the issuance of the Outstanding Obligations it is provided that additional Revenue Notes or Bonds may be issued on a parity with the Outstanding Obligations, for the costs of future improvements and extensions to the System or refunding outstanding obligations, provided that there has been procured and placed on file with the Clerk, a statement complying with the conditions and limitations therein imposed upon the issuance of Parity Obligations; and WHEREAS, a statement of Public Financial Management, Inc., an Independent Financial Consultant not in the regular employ of Issuer, has been placed on file in the office of the Clerk, showing the conditions and limitations of the Resolutions, dated September 19, 2000, November 27, 2001 and March 19, 2002, respectively, with regard -3- 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; and WHEREAS, the notice of intention of Issuer to take action for the issuance of not to exceed $27,000,000 Sewer Revenue Capital Loan Notes, Series 2008, has heretofore been duly published and no objections to such proposed action have been filed and the City desires to proceed with the issuance of $24,280,000 Notes: NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IN THE COUNTY OF JOHNSON, 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 Obligations" shall mean any Sewer revenue notes or bonds issued on a parity with the Notes in accordance with the provisions of this Resolution. • "Authorized Denominations" shall mean $5,000 or any integral multiple thereof. • "Beneficial Owner" shall mean the person in whose name such Note is recorded as the beneficial owner of a Note by a Participant on the records of such Participant or such person's subrogee. • "Cede & Co." shall mean Cede & Co., the nominee of DTC, and any successor nominee of DTC with respect to the Notes. • "Clerk" shall mean the Clerk or such other officer of the successor Governing Body as shall be charged with substantially the same duties and responsibilities. • "Continuing Disclosure Certificate" shall mean that certain Continuing Disclosure Certificate executed by the Issuer and dated the date of issuance and delivery of the Notes, as originally executed and as it may be amended from time to time in accordance with the terms thereof. -4- • "Depository Notes" shall mean the Notes as issued in the form of one global certificate for each maturity, registered in the Registration Books maintained by the Registrar in the name of DTC or its nominee. • "DTC" shall mean The Depository Trust Company, New York, New York, a limited purpose trust company, or any successor book-entry securities depository appointed for the Notes. • "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, except to the extent of any conflict with the terms of the Outstanding Obligations while the same remain outstanding. • "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 Iowa City, Iowa. • "Loan Agreement" shall mean a Loan Agreement between the Issuer and a lender or lenders in substantially the form attached to and approved by this Resolution. • "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. -5- • "Notes" shall mean $24,280,000 Sewer Revenue Refunding Capital Loan Notes, Series 2008C, authorized to be issued by this Resolution. • "Original Purchaser" shall mean the purchaser of the Notes from Issuer at the time of their original issuance. • "Outstanding Obligations" shall mean the Sewer Revenue Bonds dated October 1, 2000, December 1, 2001 and April 1, 2002, issued in accordance with Resolution No. 00-320 adopted September 19, 2000; Resolution No. 01-374 adopted November 27, 2001 and Resolution No. 02-106 adopted March 19, 2002, which obligations in the amount of $9,575,000; $10,250,000 and $11,580,000, respectively, are still outstanding and unpaid and remain a lien on the Net Revenues of the System. • "Parity Obligations" shall mean sewer revenue notes, bonds or other obligations payable solely from the Net Revenues of the System on an equal basis with the Notes herein authorized to be issued, and shall include Additional Obligations as authorized to be issued under the terms of this Resolution and the Outstanding Obligations. • "Participants" shall mean those broker-dealers, banks and other financial institutions for which DTC holds Notes as securities depository. • "Paying Agent" shall mean the City Controller, 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 -6- - 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) 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 classification, "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 "AAAm-G" or better by S&P; ^ pre-refunded municipal obligations defined as any bonds 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 -7- 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 bonds 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 bonds 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 bonds 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. • "Registrar" shall mean the City Controller of Iowa City, Iowa, 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. • "Representation Letter" shall mean the Blanket Issuer Letter of Representations executed and delivered by the Issuer to DTC on file at DTC. • "Reserve Fund Requirement" shall mean an amount equal to the lesser of (a) the maximum annual amount of the principal and interest coming due on the Notes and Parity Obligations; (b) 10 % of the stated principal amount of the Notes and Parity Obligations or (c) 125% of the average annual principal and -8- interest coming due on the Notes and Parity Obligations. For purposes of this definition: (1) "issue price" shall be substituted for "stated principal amount" for issues with original issue discount or original issue premium of more than a de minimus amount and (2) stated principal amount shall not include any portion of an issue refunded or advance refunded by a subsequent issue. • "Resolution" shall mean this resolution authorizing the issuance of the Notes. • "System" shall mean the Municipal Sewer 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 Obligations remain outstanding; all real and personal property; and all appurtenances, contracts, leases, franchises and other intangibles. • "Tax Exemption Certificate" shall mean the Tax Exemption Certificate executed by the Treasurer and delivered at the time of issuance and delivery of the Notes. • "Treasurer" shall mean the Finance Director 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. • "Yield Restricted" shall mean required to be invested at a yield that is not materially higher than the yield on the Notes under section 148 (a) of the Internal Revenue Code or regulations issued thereunder. Section 2. Authori .The Loan Agreement and the Notes authorized by this Resolution shall be issued pursuant to Sections 384.24A and 384.82, of the City Code of Iowa, and in compliance with all applicable provisions of the Constitution and laws of the State of Iowa. The Loan Agreement shall be substantially in the form attached to this Resolution and is 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 Revenue Notes of the City of Iowa City, in the County of Johnson, State of Iowa, in the aggregate amount of $24,280,000, for the purpose of paying costs of the refunding of the outstanding Series 1996, 1997 and 1999 Sewer Revenue Bonds, dated March 15, 1996, June 1, 1997 and February 1, 1999, respectively. -9- Section 4. Source of Payment. The Notes herein authorized and Parity Notes and Parity Obligations and the interest thereon shall be payable solely and only out of the net earnings of the System and shall be a first 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 net revenues to be sufficient for the payment of the Notes. Section 5. Note Details. Sewer Revenue Refunding Capital Loan Notes, Series 2008C, of the City in the amount of $24,280,000 shall be issued to evidence the obligations of the Issuer under the Loan Agreement pursuant to the provisions of Sections 384.24A and 384.82 of the City Code of Iowa for the aforesaid purpose. The Notes shall be designated "SEWER REVENUE REFUNDING CAPITAL LOAN NOTE, SERIES 2008C", be dated October 15, 2008, and bear interest from the date thereof, until payment thereof, at the office of the Paying Agent, such interest payable on January 1, 2009, and semiannually thereafter on the 1st day of July and January in each year until maturity at the rates hereinafter provided. The Notes shall be executed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the City Clerk, and impressed or printed 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 to the registered owner of the Note. The Notes shall be in the denomination of $5,000 or multiples thereof. The Notes shall mature and bear interest as follows: Interest Principal Maturity Rate Amount July 1st 3.00% $1,495,000 2009 3.00% $1,580,000 2010 3.00% $1,645,000 2011 3.25% $1,680,000 2012 3.25% $1,735,000 2013 3.50% $1,800,000 2014 3.75% $1,885,000 2015 4.00% $1,945,000 2016 4.00% $2,035,000 2017 4.00% $2,095,000 2018 5.00% $2,205,000 2019 5.00% $1,775,000 2020 5.00% $1,850,000 2021 5.00% $ 555,000 2022 -10- Section 6. Redemption. Notes maturing after July 1, 2016, may be called for redemption by the Issuer and paid before maturity on such date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Thirty days' notice of redemption shall be given by ordinary mail to the registered owner of the Note. Failure to give such notice by mail to any registered owner of the Notes or any defect therein shall not affect the validity of any proceedings for the redemption of the Notes. All Notes or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the Notes to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of Notes to be called has been reached. Section 7. Issuance of Notes in Book-Entry Form; Replacement Notes. (a) Notwithstanding the other provisions of this Resolution regarding registration, ownership, transfer, payment and exchange of the Notes, unless the Issuer determines to permit the exchange of Depository Notes for Notes in the Authorized Denominations, the Notes shall be issued as Depository Notes in denominations of the entire principal amount of each maturity of Notes (or, if a portion of the principal amount is prepaid, the principal amount less the prepaid amount); and such Depository Notes shall be registered in the name of Cede & Co., as nominee of DTC. Payment of semi-annual interest for.any Depository Note shall be made by wire transfer or New York Clearing House or equivalent next day funds to the account of Cede & Co. on the interest payment date for the Notes at the address indicated in or pursuant to the Representation Letter. (b) With respect to Depository Notes, neither the Issuer nor the Paying Agent shall have any responsibility or obligation to any Participant or to any Beneficial Owner. Without limiting the immediately preceding sentence, neither the Issuer nor the Paying Agent shall have any responsibility or obligation with respect to (i) the accuracy of the records of DTC or its nominee or of any Participant with respect to any ownership interest in the Notes, (ii) the delivery to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any notice with respect to the Notes, (iii) the payment to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any amount with respect to the principal of, premium, if any, or interest on the Notes, or (iv) the failure of DTC to provide any information or notification on behalf of any Participant or Beneficial Owner. The Issuer and the Paying Agent may treat DTC or its nominee as, and deem DTC or its nominee to be, the absolute owner of each Note for the purpose of payment of the principal of, premium, if any, and interest on such Note, for the purpose of all other matters with respect to such Note, for the purpose of registering transfers with respect to such Notes, and for all other purposes whatsoever (except for the giving of certain Noteholder consents, in accordance with the practices and procedures of DTC as may be applicable thereto). The Paying Agent shall pay all principal of, premium, if any, and interest on the Notes only to or upon the order of the Noteholders as shown on the Registration Books, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to the principal of, premium, if any, and interest on the Notes to the extent so paid. Notwithstanding the provisions of this Resolution to the contrary (including without limitation those provisions relating to the surrender of Notes, registration thereof, and issuance in Authorized Denominations), as long as the Notes are Depository Notes, full effect shall be given to the Representation Letter and the procedures and practices of DTC thereunder, and the Paying Agent shall comply therewith. (c) Upon (i) a determination by the Issuer that DTC is no longer able to carry out its functions or is otherwise determined unsatisfactory, or (ii) a determination by DTC that the Notes are no longer eligible for its depository services or (iii) a determination by the Paying Agent that DTC has resigned or discontinued its services for the Notes, if such substitution is authorized by law, the Issuer shall (A) designate a satisfactory substitute depository as set forth below or, if a satisfactory substitute is not found, (B) provide for the exchange of Depository Notes for replacement Notes in Authorized Denominations. (d) To the extent authorized by law, if the Issuer determines to provide for the exchange of Depository Notes for Notes in Authorized Denominations, the Issuer shall so notify the Paying Agent and shall provide the Registrar with a supply of executed unauthenticated Notes to be so exchanged. The Registrar shall thereupon notify the owners of the Notes and provide for such exchange, and to the extent that the Beneficial Owners are designated as the transferee by the owners, the Notes will be delivered in appropriate form, content and Authorized Denominations to the Beneficial Owners, as their interests appear. (e) Any substitute depository shall be designated in writing by the Issuer to the Paying Agent. Any such substitute depository shall be a qualified and registered "clearing agency" as provided in Section 17A of the Securities Exchange Act of 1934, as amended. -12- The substitute depository shall provide for (i) immobilization of the Depository Notes, (ii) registration and transfer of interests in Depository Notes by book entries made on records of the depository or its nominee and (iii) payment of principal of, premium, if any, and interest on the Notes in accordance with and as such interests may appear with respect to such book entries. 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 City Controller 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 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. -13- (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. (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. (g) Registration and Transfer Fees. The Registrar may furnish to each owner, at the Issuer's expense, one note for each annual maturity. The Registrar shall furnish additional Notes in lesser denominations (but not less than the minimum denomination) to an owner who so requests. 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 -14- 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 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. Payment of principal shall only be made upon surrender of the Note to the Paying Agent. Section 11. Execution Authentication and Delivery of the Notes. Upon the adoption of this Resolution, the Mayor and 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 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 Re ig stray. Issuer reserves the right to name a substitute, successor Registrar or Paying Agent upon giving prompt written notice to each registered Noteholder. -15- 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: (~) (8) (1) (9) (9a) (10) (Continued on the back of this Note) FIGURE 1 (Front) -16- (IO) (16) (Continued) FIGURE 2 (Back) -17- 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" Item 2, figure Item 3, figure Item 4, figure Item 5, figure Item 6, figure Item 7, figure Item 8, figure "COUNTY OF JOHNSON" "CITY OF IOWA CITY" "SEWER REVENUE REFUNDING CAPITAL LOAN NOTE" "SERIES 2008C" = Rate: = Maturity: = Note Date October 15, 2008 = Cusip No.: _ "Registered" = Certificate No. = Principal Amount: $ Item 9, figure 1 = The City of Iowa City, 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 Item 9A, figure 1 = (Registration panel to be completed by Registrar or Printer with name of Registered Owner). Item 10, figure 1 = or registered assigns, the principal sum of (principal amount written outl THOUSAND DOLLARS in lawful money of the United States of America, on the maturity date shown above, only upon presentation and surrender hereof at the office of the City Controller, Paying Agent of this issue, or its successor, with interest on such sum from the date hereof until paid at the rate per annum specified above, payable on January 1, 2009, and semiannually thereafter on the 1st day of July and January in each year. 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 preceding such interest payment date. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. -18- This Note is issued pursuant to the provisions of Sections 384.24A and 384.82 of the City Code of Iowa, for the purpose of paying costs of the refunding of the outstanding Series 1996, 1997 and 1999 Sewer Revenue Bonds, dated March 15, 1996, June 1, 1997 and February 1, 1999, respectively, and in order to evidence the obligations of the Issuer under a certain Loan Agreement dated , 2008, in conformity to a Resolution of the City Council of the 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 Agreement and Resolution. Unless this certificate is presented by an authorized representative of The Depository Trust Company, a limited purpose trust company ("DTC"), to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. Notes maturing after July 1, 2016, may be called for redemption by the Issuer and paid before maturity on such date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Thirty days' notice of redemption shall be given by ordinary mail to the registered owner of the Note. Failure to give such notice by mail to any registered owner of the Notes or any defect therein shall not affect the validity of any proceedings for the redemption of the Notes. All Notes or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the Notes to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of Notes to be called has been reached. Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the City Controller, the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Note at the office of the Registrar as -19- designated below, 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 obligations ranking on a parity therewith, and any Additional Obligations which may be hereafter issued and outstanding from time to time on a parity with the Notes, as provided in the Note Resolution and Loan Agreement of which notice is hereby given and which are hereby made a part hereof, are payable from and secured by a pledge of the net revenues of the Municipal Sewer Utility (the "System"), as defined and provided in the 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 the System in each year for the payment of the proper and reasonable expenses of operation and maintenance of the System and for the establishment of a sufficient sinking fund to meet the principal of and interest on this series of Notes, and other Obligations 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 the 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, the City by its City Council has caused this Note to be signed by the facsimile signature of its Mayor and attested by the facsimile signature of its Clerk, with the seal of the City printed hereon, and authenticated by the manual signature of an authorized representative of the Registrar, the City Controller, Iowa City, Iowa. Item 11, figure I =Date of Authentication: Item 12, figure 1 =This is one of the Notes described in the within mentioned Resolution, as registered by the City Controller. -20- CITY CONTROLLER, Registrar By: Authorized Signature Item 13, figure 1 =Registrar and Transfer Agent: City Controller Paying Agent: City Controller SEE REVERSE FOR CERTAIN DEFINITIONS Item 14, figure 1 = (Seal) Item 15, figure 1 = [Signature Block] CITY OF IOWA CITY, IOWA By: (facsimile si ng a~ture) Mayor ATTEST: By:~facsimile si ng aturel City Clerk Item 16, figure 1 = [Statement of Insurance] Financial Security Assurance Inc. ("Financial Security"), New York, New York, has delivered its municipal bond insurance policy with respect to the scheduled payments due of principal of and interest on this Note to the City Controller, Iowa City, Iowa, or its successor, as paying agent for the Notes (the "Paying Agent"). Said Policy is on file and available for inspection at the principal office of the Paying Agent and a copy thereof may be obtained from Financial Security or the Paying Agent. 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. ) -21- the within Note and does hereby irrevocably constitute and appoint attorney in fact to transfer the Note on the books kept for registration of the within Note, with full power of substitution in the premises. Dated (Person(s) executing this Assignment sign(s) here) SIGNATURE ) GUARANTEED) 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* Partnership Corporation 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 -22- JT TEN - as joint tenants with right of survivorship and not as tenants in common IA UNIF TRANS MIN ACT - ................Custodian.................... (Gust) (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 Obligations 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 revenues of the System are hereby irrevocably pledged to the timely payment of both principal and interest as the same become due. Section 15. Application of Note Proceeds -Redemption and Current Refunding of Refunded Bonds. Proceeds of the Notes shall be applied as follows: All of proceeds shall be deposited in trust with the Treasurer for the payment of the Refunded Bonds and is irrevocably appropriated exclusively to the payment of principal of, interest on and premium, if any, due on the redemption thereof. Said amount shall be held separately from all other moneys or accounts, in cash or direct obligations of the United States, maturing on or before the Call Date of the Refunded Bonds, and is determined to be sufficient to retire on the designated Call Date all of such obligations, together with the interest thereon to the designated redemption date and premium thereon, if any, that may be payable on the redemption of the same. The Refunded Bonds are called and shall be redeemed as of the Call Date. The City Controller or City Clerk is hereby authorized and directed to cause notice of such redemption to be given in compliance with the terms of the Refunded Bonds. As used in this Section "Call Date" shall mean October 15, 2008, on which date the Refunded Bonds shall be redeemed and paid. -23- "Refunded Bonds" shall mean the outstanding bonds maturing July 1 of the years 2009 through and including 2021 of Sewer Revenue Bonds, Series 1996, in the amount of $12,650,000; bonds maturing July 1 of the years 2009 through and including 2022 of Sewer Revenue Bonds, Series 1997, in the amount of $7,600,000; and bonds maturing July 1 of the years 2009 through and including 2019 of Sewer Revenue Bonds, Series 1999, in the amount of $4,560,000. 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. The rates or charges to be paid by 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. So long as the Notes are outstanding and unpaid the rates or charges to consumers of services of the System shall be sufficient in each year for the payment of the proper and reasonable expenses of operation and maintenance of the System and for the payment of principal and interest on the Notes and Parity Notes and obligations as the same fall due, and to provide for the creation of reserves as hereinafter provided. 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 Obligations shall be outstanding and unpaid either as to principal or as to interest, or until all of the Notes and Parity Obligations 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 Sewer 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 Sewer Revenue Operation and Maintenance Fund (the "Operation and Maintenance Fund"). There shall be deposited in the Operation and Maintenance Fund each month an amount sufficient -24- to meet the current expenses of the month plus an amount equal to I/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 Obligations. The fund shall be known as the Sewer Revenue 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 Obligations, 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 Obligations as the same shall become due and payable. (c) Reserve Fund. Money in the Revenue Fund shall be disbursed to maintain a debt service reserve in an amount equal to the Reserve Fund Requirement. Such fund shall be known as the Sewer Revenue Debt Service Reserve Fund (the "Reserve Fund"). In each month there shall be deposited in the Reserve Fund an amount equal to 25 percent of the amount required by this Resolution to be deposited in such month in the Sinking Fund; provided, however, that when the amount on deposit in the Reserve Fund shall be not less than the Reserve Fund Requirement, no further deposits shall be made into the Reserve Fund except to maintain such level, and when the amount on deposit in the Reserve Fund is greater than the balance required above, such additional amounts shall be withdrawn and paid into the Revenue Fund. Money in the Reserve Fund shall be used solely for the purpose of paying principal at maturity of or interest on the Notes and Parity Obligations for the payment of which insufficient money shall be available in the Sinking Fund. Whenever it shall become necessary to so use money in the Reserve Fund, the payments required above shall be continued or resumed until it shall have been restored to the required minimum amount. (d) Improvement Fund. Money in the Revenue Fund shall next be disbursed to maintain a fund to be known as the Sewer Revenue Improvement Fund -25- (the "Improvement Fund"). The minimum amount to be deposited in the Improvement Fund each month shall be $20,000; provided, however, that when the amount of such deposits in the fund shall equal or exceed $2,000,000, no further monthly deposits need be made into the Improvement Fund except to maintain it at such level. Money in the Improvement Fund not otherwise specially limited by other provisions of this Resolution shall be used solely for the purpose of paying principal of or interest on the Notes or Parity Obligations when there shall be insufficient money in the Sinking Fund and the Reserve Fund; and to the extent not required for the foregoing, to pay the cost of extraordinary maintenance expenses or repairs, renewals and replacements not included in the annual budget of revenues and current expenses, payment of rentals on any part of the System or payments due for any property purchased as a part of the System, and for capital improvements to the System. Whenever it shall become necessary to so use money in the Improvement Fund, the payments required above shall be continued or resumed until it shall have been restored to the required minimum amount. (e) Subordinate Obli atg_ions. 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 Obligations, and which have been issued for the purposes of extensions and improvements to the System or to retire the Notes or Parity Obligations in advance of maturity, or to pay for extraordinary repairs or replacements to the System. (f) 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, to pay for extraordinary repairs or replacements to the System, or may be used to pay or redeem the Notes or Parity Obligations, 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 the funds are listed, on a cumulative basis on the 10th day of each month, or on the next succeeding business day 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 the 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. -26- Section 17.1. Outstandin.~ Obli atgi ions. 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 Resolution shall be inclusive of payments required in respect to the Outstanding Obligations. The provisions of the resolution or resolutions referred to in Section 1 of this Resolution 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 authorized by the resolution have been paid in full or otherwise satisfied as therein provided at which time the provisions of this Resolution shall again prevail. Section 18. Investments. 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 in 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 Chapter 12C of the Code of Iowa, 2007, as amended or otherwise by a valid pledge of direct obligations of the United States Government having an equivalent market value. All such interim investments shall mature before the date on which the moneys are required for the purposes for which the fund was created or otherwise as herein provided but in no event maturing in more than three years in the case of the Reserve Fund. The provisions of this Section shall not be construed to require the Issuer to maintain separate bank accounts for the funds created by this Section; except the Sinking Fund and the Reserve Fund shall be maintained in a separate account but may be invested in conjunction with other funds of the City but designated as a trust fund on the books and records of the City. All income derived from such investments shall be deposited in the Revenue Fund and shall be regarded as revenues of the System. Investments shall at any time necessary be liquidated and the proceeds thereof applied to the purpose for which the respective fund was created. Section 19. Covenants Re ag rdin tg he Operation of the System. The Issuer hereby covenants and agrees with each and every holder of the Notes and Parity Obligations: (a) Maintenance and Efficiency. The Issuer will maintain the System in good condition and operate it in an efficient manner and at reasonable cost. -27- (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 charges otherwise in effect are sufficient to provide Net Revenues at least equal to the requirements of this subsection. (c) Insurance. That 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, or if not so used shall be placed in the Improvement Fund. (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 Obligations upon request. The holders of any of the Notes and Parity Obligations shall have at all reasonable times the right to inspect the System and the records, accounts and data of the Issuer relating thereto. (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 the revenues to the funds specified in this Resolution. (f) Pro e .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 Obligations shall have been provided for in the manner provided in this Resolution; provided, however, that this covenant shall not be construed to -28- 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 to be 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 Obligations shall not be used to pay principal or interest on the Notes or Parity Obligations or for payments into the Sinking or Reserve Funds. (g) Fidelitx Bond. The Issuer shall maintain fidelity bond 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) Additional Charges. The Issuer will require proper connecting charges and/or other security for the payment of service charges. (i) 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 Year. Copies of such budget and any amendments thereto shall be provided to the holders of any of the Notes upon request. Section 20. Remedies of Noteholders. Except as herein expressly limited the holder or holders of the Notes and Parity Obligations 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. Section 21. Prior Lien and Parity Obli atm. The Issuer will issue no other notes, bonds 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 Obligations. Additional Obligations may be issued on a parity and equality of rank with the Notes with respect to the lien and claim of such Additional Obligations 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: -29- (a) For the purpose of refunding any of the Notes or Parity Obligations which shall have matured or which shall mature not later than three months after the date of delivery of such refunding obligation and for the payment of which there shall be insufficient money in the Sinking Fund and the Reserve Fund; (b) For the purpose of refunding any outstanding Notes, Parity Obligations or general obligation notes 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 Obligations ranking on a parity are issued, there will have been procured and filed with the City Clerk, a statement of an Independent Auditor, independent financial consultant or a Consulting Engineer, 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 1.25 times the maximum amount that will be required in any Fiscal Year prior to the longest maturity of any of the Notes or Parity Obligations for both principal of and interest on all Notes and Parity Obligations then outstanding which are payable from the net earnings of the System and the Additional Obligations 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, independent financial consultant or a Consulting Engineer, 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 Obligations been in effect during all of such preceding Fiscal Year. (ii) the Additional Obligations must be payable as to principal and as to interest on the same month and day as the Notes herein authorized. (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. -30- (iv) for the purposes of this Section, general obligation bonds or notes shall be refunded only upon a finding of necessity by the Governing Body and only to the extent the general obligation bonds or notes were issued or the proceeds thereof 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 Additional Obligations. Section 22. Disposition of Proceeds: Arbitrage Not Permitted. The Issuer reasonably expects and covenants that no use will be made of the proceeds from the issuance and sale of the Notes issued hereunder which will cause any of the Notes to be classified as arbitrage bonds within the meaning of Section 148(a) and (b) of the Internal Revenue Code of the United States, and that throughout the term of the Notes it will comply with the requirements of such statute and regulations issued thereunder. To the best knowledge and belief of the Issuer, there are no facts or circumstances that would materially change the foregoing statements or the conclusion that it is not expected that the proceeds of the Notes will be used in a manner that would cause the Notes to be arbitrage bonds. Without limiting the generality of the foregoing, the Issuer hereby agrees to comply with the provisions of the Tax Exemption Certificate and the provisions of the Tax Exemption Certificate are hereby incorporated by reference as part of this Resolution. The Treasurer is hereby directed to make and insert all calculations and determinations necessary to complete the Tax Exemption Certificate in all respects and to execute and deliver the Tax Exemption Certificate at issuance of the Notes to certify as to the reasonable expectations and covenants of the Issuer at that date. The Issuer covenants that it will treat as Yield Restricted any proceeds of the Notes remaining unexpended after three years from the issuance and any other funds required by the Tax Exemption Certificate to be so treated. If any investments are held with respect to the Notes and Parity Obligations, the Issuer shall treat the same for the purpose of restricted yield as held in proportion to the original principal amounts of each issue. The Issuer covenants that it will exceed any investment yield restriction provided in this Resolution only in the event that it shall first obtain an opinion of recognized bond counsel that the proposed investment action will not cause the Notes to be classified as -31- arbitrage bonds under Section 148(a) and (b) the Internal Revenue Code or regulations issued thereunder. The Issuer covenants that it will proceed with due diligence to spend the proceeds of the Notes for the purpose set forth in this Resolution. The Issuer further covenants that it will make no change in the use of the proceeds available for the construction of facilities or change in the use of any portion of the facilities constructed therefrom by persons other than the Issuer or the general public unless it has obtained an opinion of bond counsel or a revenue ruling that the proposed project or use will not be of such character as to cause interest on any of the Notes not to be exempt from federal income taxes in the hands of holders other than substantial users of the project, under the provisions of Section 142(a) of the Internal Revenue Code of the United States, related statutes and regulations. Section 23. Additional Covenants, Representations and Warranties of the Issuer. The Issuer certifies and covenants with the purchasers and holders of the Notes from time to time outstanding that the Issuer through its officers, (a) will make such further specific covenants, representations and assurances as may be necessary or advisable; (b) comply with all representations, covenants and assurances contained in the Tax Exemption Certificate, which Tax Exemption Certificate shall constitute a part of the contract between the Issuer and the owners of the Notes; (c) consult with bond counsel (as defined in the Tax Exemption Certificate); (d) pay to the United States, as necessary, such sums of money representing required rebates of excess arbitrage profits relating to the Notes; (e) file such forms, statements and supporting documents as may be required and in a timely manner; and (f) if deemed necessary or advisable by its officers, to employ and pay fiscal agents, financial advisors, attorneys and other persons to assist the Issuer in such compliance. Section 24. Not Qualified Tax-Exempt Obligations. The Notes shall not be designated as qualified tax-exempt obligations as defined by Section 265 (b) of the Internal Revenue Code of the United States, as amended. Section 25. 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 Obligations, or any of them, in any one or more of the following ways: (a) By paying the Notes or Parity Obligations when the same shall become due and payable; and -32- (b) By depositing in trust with the Treasurer, or with a corporate trustee designated by the Governing Body for the payment of the 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 the 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 Obligations 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. Section 26. 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 Obligations, 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 Obligations, and interest due thereon, shall have been satisfied and discharged as provided in this Resolution. Section 27. Amendment of Resolution Without Consent. The Issuer may, without the consent of or notice to any of the holders of the Notes and Parity Obligations, 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 Obligations; 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 Obligations; (b) to change the terms or provisions of this Resolution to the extent necessary to prevent the interest on the Notes or Parity Obligations from being includable within the gross income of the holders thereof for federal income tax purposes; -33- (c) to grant to or confer upon the holders of the Notes or Parity Obligations 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 28. 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 Obligations 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 Obligations as may have been issued for the purpose of refunding any of such Notes if such Refunding Obligations shall not then be owned by the Issuer); but this Resolution may not be so amended in such manner as to: (a) Make any change in the maturity of 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 Obligations 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 Note 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 Clerk. Whenever at any time within one year from the date of the mailing of the notice there shall be filed with the Clerk an instrument or instruments executed by the holders of -34- 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 the 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 Obligations. 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 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. 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. Section 29. 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 30. Continuing Disclosure. The Issuer hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate, and the provisions of the Continuing Disclosure Certificate are hereby approved and incorporated by reference as part of this Resolution and made a part hereof and the Mayor and City Clerk are hereby authorized to execute and deliver the same at issuance of the Notes. Notwithstanding any other provision of this Resolution, failure of the Issuer to comply with the Continuing Disclosure Certificate shall not be considered an event of default under this Resolution; however, any holder of the Notes or Beneficial Owner may take such actions as may be necessary and appropriate, including seeking -35- specific performance by court order, to cause the Issuer to comply with its obligations under the Continuing Disclosure Certificate. For purposes of this Section, "Beneficial Owner" means any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Notes (including persons holding Notes through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Notes for federal income tax purposes. Section 31. 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. PASSED AND APPROVED this ~_ day of ~~ptemher , 2008. ATTEST: ~ ~ ~~ City rk -36- CIG-3 9/91 CERTIFICATE STATE OF IOWA ) SS COUNTY OF JOHNSON ) I, the undersigned City Clerk of Iowa City, 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 25th day of September , 2008. City Cler ,Iowa City, Iowa SEAL 588729.1 \ W P 10714.083 September 23 ,2008 The City Council of Iowa City, Iowa, met in regular session, in the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, at ~ : 00 o'clock P .M., on the above date. There were present Mayor Bailey , in the chair, and the following named Council Members: Bailey, Champion, Correia, Hayek, O'Donnell, Wilburn, Wright Absent: None 10 Council Member Wright moved that the form of Tax Exemption. Certificate be placed on file and approved. Council Member Hayek seconded the motion and the roll being called thereon, the vote was as follows: AYES: Bailey. ChamQion, Correia, Hayek, O'Donnell, Wilburn, Wright NAYS: None Council Member Hayek moved that the form of Continuing Disclosure Certificate be placed on file and approved. Council Member Wright seconded the motion and the roll being called thereon, the vote was as follows: AYES; Bailey, Champion, Correia, Hayek, O'Donnell, Wilburn, Wright NAYS: None Council Member Champion introduced the following Resolution entitled "A RESOLUTION APPROVING AND AUTHORIZING A FORM OF LOAN AGREEMENT AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $7,115,000 WATER REVENUE REFUNDING CAPITAL LOAN NOTES, SERIES 2008D, OF THE CITY OF IOWA CITY, IOWA, UNDER THE PROVISIONS OF THE CITY CODE OF IOWA, AND PROVIDING FOR A METHOD OF PAYMENT OF THE NOTES", and moved its adoption. Council Member Hayek seconded the motion to adopt. The roll was called and the vote was: AYES; Wilburn, Wright, Bailey, Champion, Correia, k, O'Donnell NAYS: None -2- Whereupon the Mayor declared the following Resolution duly adopted: Resolution No. 08-291 A RESOLUTION APPROVING AND AUTHORIZING A FORM OF LOAN AGREEMENT AND AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $7,115,000 WATER REVENUE REFUNDING CAPITAL LOAN NOTES, SERIES 2008D, OF THE CITY OF IOWA CITY, IOWA, UNDER THE PROVISIONS OF THE CITY CODE OF IOWA, AND PROVIDING FOR A METHOD OF PAYMENT OF THE NOTES WHEREAS, the City Council of the City of Iowa City, 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 Municipal Water Utility, sometimes hereinafter referred to as the "System", and the revenues have not been pledged and are available for the payment of Water Revenue Capital Loan Notes, Series 2008, subject to the following premises; and WHEREAS, Issuer proposes to issue its Water Revenue Capital Loan Notes, Series 2008D, to the extent of $7,115,000, for the purpose of defraying the costs of the project as set forth in Section 3 of this Resolution; and, it is deemed necessary and advisable and in the best interests of the City that a form of Loan Agreement be approved and authorized; and WHEREAS, there have been heretofore issued certain water revenue bonds, notes or other obligations, part of which remain outstanding and are a lien on the net revenues of the System (defined herein as the "Outstanding Obligations"); and WHEREAS, in the Resolutions authorizing the issuance of the Outstanding Obligations it is provided that additional Revenue Notes or Bonds may be issued on a parity with the Outstanding Obligations, for the costs of future improvements and extensions to the System or refunding outstanding obligations, provided that there has been procured and placed on file with the Clerk, a statement complying with the conditions and limitations therein imposed upon the issuance of Parity Obligations; and WHEREAS, a statement of Public Financial Management, Inc., an Independent Financial Consultant, not in the regular employ of Issuer, has been placed on file in the office of the Clerk, showing the conditions and limitations of the Resolutions, dated November 21, 2000 and October 22, 2002, with regard to the sufficiency of the revenues -3- 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; and WHEREAS, the notice of intention of Issuer to take action for the issuance of not to exceed $8,000,000 Water Revenue Capital Loan Notes, Series 2008, has heretofore been duly published and no objections to such proposed action have been filed and the City desires to proceed with the issuance of $7,115,000 Notes: NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IN THE COUNTY OF JOHNSON, 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 Obligations" shall mean any Water revenue notes or bonds issued on a parity with the Notes in accordance with the provisions of this Resolution. • "Authorized Denominations" shall mean $5,000 or any integral multiple thereof. • "Beneficial Owner" shall mean the person in whose name such Note is recorded as the beneficial owner of a Note by a Participant on the records of such Participant or such person's subrogee. • "Cede & Co." shall mean Cede & Co., the nominee of DTC, and any successor nominee of DTC with respect to the Notes. • "Clerk" shall mean the Clerk or such other officer of the successor Governing Body as shall be charged with substantially the same duties and responsibilities. • "Continuing Disclosure Certificate" shall mean that certain Continuing Disclosure Certificate executed by the Issuer and dated the date of issuance and delivery of the Notes, as originally executed and as it may be amended from time to time in accordance with the terms thereof. • "Depository Notes" shall mean the Notes as issued in the form of one global certificate for each maturity, registered in the Registration Books maintained by the Registrar in the name of DTC or its nominee. -4- • "DTC" shall mean The Depository Trust Company, New York, New York, a limited purpose trust company, or any successor book-entry securities depository appointed for the Notes. • "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, except to the extent of any conflict with the terms of the Outstanding Obligations while the same remain outstanding. • "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 Iowa City, Iowa. • "Loan Agreement" shall mean a Loan Agreement between the Issuer and a lender or lenders in substantially the form attached to and approved by this Resolution. • "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" shall mean $7,115,000 Water Revenue Refunding Capital Loan Notes, Series 2008D, authorized to be issued by this Resolution. • "Original Purchaser" shall mean the purchaser of the Notes from Issuer at the time of their original issuance. -S- • "Outstanding Obligations" shall mean the Water Revenue Bonds dated December 1, 2000 and November 1, 2002, issued in accordance with Resolution Numbered 00-395 adopted November 21, 2000 and Resolution Numbered 02-370 adopted October 22, 2002, which obligations in the amount of $10,280,000 and $6,515,000 are still outstanding and unpaid and remain a lien on the Net Revenues of the System. • "Parity Obligations" shall mean water revenue notes, bonds or other obligations payable solely from the Net Revenues of the System on an equal basis with the Notes herein authorized to be issued; and shall include Additional Obligations as authorized to be issued under the terms of this Resolution and the Outstanding Obligations. • "Participants" shall mean those broker-dealers, banks and other financial institutions for which DTC holds Notes as securities depository. • "Paying Agent" shall mean the City Controller, 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) - IJ.S. Department of Housing & Urban Development (PHA's) - Federal Housing Administration -6- ^ 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) 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 classification, "A- l+" 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 "AAAm-G" or better by S&P; ^ pre-refunded municipal obligations defined as any bonds 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 bonds 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 -7- principal of and interest and redemption premium, if any, on the bonds 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 bonds 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. • "Registrar" shall mean the City Controller of Iowa City, Iowa, 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. • "Representation Letter" shall mean the Blanket Issuer Letter of Representations executed and delivered by the Issuer to DTC on file at DTC. • "Reserve Fund Requirement" shall mean an amount equal to the lesser of (a) the maximum annual amount of the principal and interest coming due on the Notes and Parity Obligations; (b) 10 % of the stated principal amount of the Notes and Parity Obligations or (c) 125% of the average annual principal and interest coming due on the Notes and Parity Obligations. For purposes of this definition: (1) "issue price" shall be substituted for "stated principal amount" for issues with original issue discount or original issue premium of more than a de minimus amount and (2) stated principal amount shall not include any portion of an issue refunded or advance refunded by a subsequent issue. • "Resolution" shall mean this resolution authorizing the issuance of the Notes. -8- • "System" shall mean the Municipal 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 Obligations remain outstanding; all real and personal property; and all appurtenances, contracts, leases, franchises and other intangibles. • "Tax Exemption Certificate" shall mean the Tax Exemption Certificate executed by the Treasurer and delivered at the time of issuance and delivery of the Notes. • "Treasurer" shall mean the Finance Director 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. • "Yield Restricted" shall mean required to be invested at a yield that is not materially higher than the yield on the Notes under section 148 (a) of the Internal Revenue Code or regulations issued thereunder. Section 2. Authori .The Loan Agreement and the Notes authorized by this Resolution shall be issued pursuant to Sections 384.24A and 384.82, of the City Code of Iowa, and in compliance with all applicable provisions of the Constitution and laws of the State of Iowa. The Loan Agreement shall be substantially in the form attached to this Resolution and is 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 Revenue Notes of the City of Iowa City, in the County of Johnson, State of Iowa, in the aggregate amount of $7,115,000, for the purpose of paying costs of the refunding of the outstanding Series 1999 Water Revenue Bonds, dated May 1, 1999. Section 4. Source of Pa,~ment. The Notes herein authorized and Parity Notes and Parity Obligations and the interest thereon shall be payable solely and only out of the net earnings of the System and shall be a first 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 net revenues to be sufficient for the payment of the Notes. -9- Section 5. Note Details. Water Revenue Refunding Capital Loan Notes, Series 2008D, of the City in the amount of $7,115,000 be issued to evidence the obligations of the Issuer under the Loan Agreement pursuant to the provisions of Sections 384.24A and 384.82 of the City Code of Iowa for the aforesaid purpose. The Notes shall be designated "WATER REVENUE REFUNDING CAPITAL LOAN NOTE, SERIES 2008D", be dated October 15, 2008, and bear interest from the date thereof, until payment thereof, at the office of the Paying Agent, such interest payable on January 1, 2009, and semiannually thereafter on the 1st day of July and January in each year until maturity at the rates hereinafter provided. The Notes shall be executed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the City Clerk, and impressed or printed 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 to the registered owner of the Note. The Notes shall be in the denomination of $5,000 or multiples thereof. The Notes shall mature and bear interest as follows: Interest Principal Maturity Rate Amount July 1st 3.000% $330,000 2009 3.000% $355,000 2010 3.000% $360,000 2011 3.250% $370,000 2012 3.250% $385,000 2013 3.500% $395,000 2014 3.500% $410,000 2015 3.750% $425,000 2016 4.000% $445,000 2017 4.000% $460,000 2018 4.000% $475,000 2019 4.000% $495,000 2020 4.125% $515,000 2021 4.250% $540,000 2022 4.375% $565,000 2023 4.375% $590,000 2024 Section 6. Redemption. Notes maturing after July 1, 2016, may be called for redemption by the Issuer and paid before maturity on such date or any date thereafter, from -10- any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Thirty days' notice of redemption shall be given by ordinary mail to the registered owner of the Note. Failure to give such notice by mail to any registered owner of the Notes or any defect therein shall not affect the validity of any proceedings for the redemption of the Notes. All Notes or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the Notes to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of Notes to be called has been reached. Section 7. Issuance of Notes in Book-Entry Form; Replacement Notes. (a) Notwithstanding the other provisions of this Resolution regarding registration, ownership, transfer, payment and exchange of the Notes, unless the Issuer determines to permit the exchange of Depository Notes for Notes in the Authorized Denominations, the Notes shall be issued as Depository Notes in denominations of the entire principal amount of each maturity of Notes (or, if a portion of the principal amount is prepaid, the principal amount less the prepaid amount); and such Depository Notes shall be registered in the name of Cede & Co., as nominee of DTC. Payment of semi-annual interest for any Depository Note shall be made by wire transfer or New York Clearing House or equivalent next day funds to the account of Cede & Co. on the interest payment date for the Notes at the address indicated in or pursuant to the Representation Letter. (b) With respect to Depository Notes, neither the Issuer nor the Paying Agent shall have any responsibility or obligation to any Participant or to any Beneficial Owner. Without limiting the immediately preceding sentence, neither the Issuer nor the Paying Agent shall have any responsibility or obligation with respect to (i) the accuracy of the records of DTC or its nominee or of any Participant with respect to any ownership interest in the Notes, (ii) the delivery to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any notice with respect to the Notes, (iii) the payment to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any amount with respect to the principal of, premium, if any, or interest on the Notes, or (iv) the failure of DTC to provide any information or notification on behalf of any Participant or Beneficial Owner. -11- The Issuer and the Paying Agent may treat DTC or its nominee as, and deem DTC or its nominee to be, the absolute owner of each Note for the purpose of payment of the principal of, premium, if any, and interest on such Note, for the purpose of all other matters with respect to such Note, for the purpose of registering transfers with respect to such Notes, and for all other purposes whatsoever (except for the giving of certain Noteholder consents, in accordance with the practices and procedures of DTC as may be applicable thereto). The Paying Agent shall pay all principal of, premium, if any, and interest on the Notes only to or upon the order of the Noteholders as shown on the Registration Books, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to the principal of, premium, if any, and interest on the Notes to the extent so paid. Notwithstanding the provisions of this Resolution to the contrary (including without limitation those provisions relating to the surrender of Notes, registration thereof, and issuance in Authorized Denominations), as long as the Notes are Depository Notes, full effect shall be given to the Representation Letter and the procedures and practices of DTC thereunder, and the Paying Agent shall comply therewith. (c) Upon (i) a determination by the Issuer that DTC is no longer able to carry out its functions or is otherwise determined unsatisfactory, or (ii) a determination by DTC that the Notes are no longer eligible for its depository services or (iii) a determination by the Paying Agent that DTC has resigned or discontinued its services for the Notes, if such substitution is authorized by law, the Issuer shall (A) designate a satisfactory substitute depository as set forth below or, if a satisfactory substitute is not found, (B) provide for the exchange of Depository Notes for replacement Notes in Authorized Denominations. (d) To the extent authorized by law, if the Issuer determines to provide for the exchange of Depository Notes for Notes in Authorized Denominations, the Issuer shall so notify the Paying Agent and shall provide the Registrar with a supply of executed unauthenticated Notes to be so exchanged. The Registrar shall thereupon notify the owners of the Notes and provide for such exchange, and to the extent that the Beneficial Owners are designated as the transferee by the owners, the Notes will be delivered in appropriate form, content and Authorized Denominations to the Beneficial Owners, as their interests appear. (e) Any substitute depository shall be designated in writing by the Issuer to the Paying Agent. Any such substitute depository shall be a qualified and registered "clearing agency" as provided in Section 17A of the Securities Exchange Act of 1934, as amended. The substitute depository shall provide for (i) immobilization of the Depository Notes, (ii) registration and transfer of interests in Depository Notes by book entries made on records of the depository or its nominee and (iii) payment of principal of, premium, if any, -12- and interest on the Notes in accordance with and as such interests may appear with respect to such book entries. 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 City Controller 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 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 -13- 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. (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. (g) Registration and Transfer Fees. The Registrar may furnish to each owner, at the Issuer's expense, one note for each annual maturity. The Registrar shall furnish additional Notes in lesser denominations (but not less than the minimum denomination) to an owner who so requests. 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 -14- 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 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. Payment of principal shall only be made upon surrender of the Note to the Paying Agent. Section 11. Execution Authentication and Delivery of the Notes. Upon the adoption of this Resolution, the Mayor and 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 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 Re ig strar. Issuer reserves the right to name a substitute, successor Registrar or Paying Agent upon giving prompt written notice to each registered Noteholder. -15- 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: (7 (g) (1) (9) (9a) (I~) (Continued on the back of this Note) FIGURE 1 (Front) -16- (10) (16) (Continued) FIGURE 2 (Back) -17- 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 JOHNSON" "CITY OF IOWA CITY" "WATER REVENUE REFUNDING CAPITAL LOAN NOTE" "SERIES 2008D" Item 2, figure Item 3, figure Item 4, figure Item 5, figure Item 6, figure Item 7, figure Item 8, figure = Rate: = Maturity = Note Date: October 15, 2008 = Cusip No.: _ "Registered" = Certificate No. = Principal Amount: $ Item 9, figure 1 = The City of Iowa City, 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 Item 9A, figure 1 = (Registration panel to be completed by Registrar or Printer with name of Registered Owner). Item 10, figure 1 = or registered assigns, the principal sum of (principal amount written outl THOUSAND DOLLARS in lawful money of the United States of America, on the maturity date shown above, only upon presentation and surrender hereof at the office of the City Controller, Paying Agent of this issue, or its successor, with interest on such sum from the date hereof until paid at the rate per annum specified above, payable on January 1, 2009, and semiannually thereafter on the 1st day of July and January in each year. 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 preceding such interest payment date. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. -18- This Note is issued pursuant to the provisions of Sections 384.24A and 384.82 of the City Code of Iowa, for the purpose of paying costs of the refunding of the outstanding Series 1999 Water Revenue Bonds, dated May 1, 1999, and in order to evidence the obligations of the Issuer under a certain Loan Agreement dated , 2008, in conformity to a Resolution of the City Council of the 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 Agreement and Resolution. Unless this certificate is presented by an authorized representative of The Depository Trust Company, a limited purpose trust company ("DTC"), to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. Notes maturing after July 1, 2016, may be called for redemption by the Issuer and paid before maturity on such date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Thirty days' notice of redemption shall be given by ordinary mail to the registered owner of the Note. Failure to give such notice by mail to any registered owner of the Notes or any defect therein shall not affect the validity of any proceedings for the redemption of the Notes. All Notes or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the Notes to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of Notes to be called has been reached. Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the City Controller, the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Note at the office of the Registrar as -19- designated below, 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 obligations ranking on a parity therewith, and any Additional Obligations which may be hereafter issued and outstanding from time to time on a parity with the Notes, as provided in the Note Resolution and Loan Agreement of which notice is hereby given and which are hereby made a part hereof, are payable from and secured by a pledge of the net revenues of the Municipal Water Utility (the "System"), as defined and provided in the 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 the System in each year for the payment of the proper and reasonable expenses of operation and maintenance of the System and for the establishment of a sufficient sinking fund to meet the principal of and interest on this series of Notes, and other Obligations 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 the 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, the City by its City Council has caused this Note to be signed by the facsimile signature of its Mayor and attested by the facsimile signature of its Clerk, with the seal of the City printed hereon, and authenticated by the manual signature of an authorized representative of the Registrar, the City Controller, Iowa City, 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 Controller. -20- CITY CONTROLLER, Registrar By: Authorized Signature Item 13, figure 1 =Registrar and Transfer Agent: City Controller Paying Agent: City Controller SEE REVERSE FOR CERTAIN DEFINITIONS Item 14, figure 1 = (Seal) Item 15, figure 1 = [Signature Block] CITY OF IOWA CITY, IOWA By: (,facsimile si ng ature) Mayor ATTEST: By: facsimile si ng_ atureL_ City Clerk Item 16, figure 1 = [Statement of Insurance] Financial Security Assurance Inc. ("Financial Security"), New York, New York, has delivered its municipal bond insurance policy with respect to the scheduled payments due of principal of and interest on this Note to the City Controller, Iowa City, Iowa, or its successor, as paying agent for the Notes (the "Paying Agent"). Said Policy is on file and available for inspection at the principal office of the Paying Agent and a copy thereof may be obtained from Financial Security or the Paying Agent. 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. -21- the within Note and does hereby irrevocably constitute and appoint attorney in fact to transfer the Note on the books kept for registration of the within Note, with full power of substitution in the premises. Dated (Person(s) executing this Assignment sign(s) here) SIGNATURE ) GUARANTEED) 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* Partnership Corporation 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 -22- IA UNIF TRANS MIN ACT - ................Custodian.................... (Gust) (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 Obligations 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 revenues of the System are hereby irrevocably pledged to the timely payment of both principal and interest as the same become due. Section 15. Application of Note Proceeds -Redemption and Current Refunding of Refunded Bonds. Proceeds of the Notes shall be applied as follows: $7,045,000 of proceeds shall be deposited in trust with the Treasurer for the payment of the Refunded Bonds and is irrevocably appropriated exclusively to the payment of principal of, interest on and premium, if any, due on the redemption thereof. Said amount shall be held separately from all other moneys or accounts, in cash or direct obligations of the United States, maturing on or before the Call Date of the Refunded Bonds, and is determined to be sufficient to retire on the designated Call Date all of such obligations, together with the interest thereon to the designated redemption date and premium thereon, if any, that may be payable on the redemption of the same. The remaining proceeds shall be held by the Treasurer and applied to pay the costs of issuance of the Notes. The Refunded Bonds are called and shall be redeemed as of the Call Date. The City Controller or City Clerk is hereby authorized and directed to cause notice of such redemption to be given in compliance with the terms of the Refunded Bonds. -23- As used in this Section "Call Date" shall mean October 15, 2008, on which date the Refunded Bonds shall be redeemed and paid. "Refunded Bonds" shall mean the outstanding bonds maturing July 1st of the years 2009 through and including 2024 of an issue of Water Revenue Bonds, Series 1999, in the amount of $7,045,000. 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. The rates or charges to be paid by 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. So long as the Notes are outstanding and unpaid the rates or charges to consumers of services of the System shall be sufficient in each year for the payment of the proper and reasonable expenses of operation and maintenance of the System and for the payment of principal and interest on the Notes and Parity Notes and obligations as the same fall due, and to provide for the creation of reserves as hereinafter provided. 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 Obligations shall be outstanding and unpaid either as to principal or as to interest, or until all of the Notes and Parity Obligations 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 Water 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 Water Revenue Operation and -24- 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 Obligations. The fund shall be known as the Water Revenue 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 Obligations, 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 Obligations as the same shall become due and payable. (c) Reserve Fund. Money in the Revenue Fund shall be disbursed to maintain a debt service reserve in an amount equal to the Reserve Fund Requirement. Such fund shall be known as the Water Revenue Debt Service Reserve Fund (the "Reserve Fund"). In each month there shall be deposited in the Reserve Fund an amount equal to 25 percent of the amount required by this Resolution to be deposited in such month in the Sinking Fund; provided, however, that when the amount on deposit in the Reserve Fund shall be not less than the Reserve Fund Requirement, no further deposits shall be made into the Reserve Fund except to maintain such level, and when the amount on deposit in the Reserve Fund is greater than the balance required above, such additional amounts shall be withdrawn and paid into the Revenue Fund. Money in the Reserve Fund shall be used solely for the purpose of paying principal at maturity of or interest on the Notes and Parity Obligations for the payment of which insufficient money shall be available in the Sinking Fund. Whenever it shall become necessary to so use money in the Reserve Fund, the payments required above shall be continued or resumed until it shall have been restored to the required minimum amount. -25- (d) Improvement Fund. Money in the Revenue Fund shall next be disbursed to maintain a fund to be known as the Water Revenue Improvement Fund (the "Improvement Fund"). The minimum amount to be deposited in the Improvement Fund each month shall be $5,000; provided, however, that when the amount of such deposits in the fund shall equal or exceed $450,000, no further monthly deposits need be made into the Improvement Fund except to maintain it at such level. Money in the Improvement Fund not otherwise specially limited by other provisions of this Resolution shall be used solely for the purpose of paying principal of or interest on the Notes or Parity Obligations when there shall be insufficient money in the Sinking Fund and the Reserve Fund; and to the extent not required for the foregoing, to pay the cost of extraordinary maintenance expenses or repairs, renewals and replacements not included in the annual budget of revenues and current expenses, payment of rentals on any part of the System or payments due for any property purchased as a part of the System, and for capital improvements to the System. Whenever it shall become necessary to so use money in the Improvement Fund, the payments required above shall be continued or resumed until it shall have been restored to the required minimum amount. (e) Subordinate Obli atg~ ions. 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 Obligations, and which have been issued for the purposes of extensions and improvements to the System or to retire the Notes or Parity Obligations in advance of maturity, or to pay for extraordinary repairs or replacements to the System. (f) 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, to pay for extraordinary repairs or replacements to the System, or may be used to pay or redeem the Notes or Parity Obligations, 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 the funds are listed, on a cumulative basis on the 10th day of each month, or on the next succeeding business day 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 the 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. -26- Section 17.1. Outstanding Obli atg_ions. 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 Resolution shall be inclusive of payments required in respect to the Outstanding Obligations. The provisions of the resolution or resolutions referred to in Section 1 of this Resolution 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 authorized by the resolution have been paid in full or otherwise satisfied as therein provided at which time the provisions of this Resolution shall again prevail. Section 18. Investments. 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 in 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 Chapter 12C of the Code of Iowa, 2007, as amended or otherwise by a valid pledge of direct obligations of the United States Government having an equivalent market value. All such interim investments shall mature before the date on which the moneys are required for the purposes for which the fund was created or otherwise as herein provided but in no event maturing in more than three years in the case of the Reserve Fund. The provisions of this Section shall not be construed to require the Issuer to maintain separate bank accounts for the funds created by this Section; except the Sinking Fund and the Reserve Fund shall be maintained in a separate account but may be invested in conjunction with other funds of the City but designated as a trust fund on the books and records of the City. All income derived from such investments shall be deposited in the Revenue Fund and shall be regarded as revenues of the System. Investments shall at any time necessary be liquidated and the proceeds thereof applied to the purpose for which the respective fund was created. Section 19. Covenants Re ag_ rdin tg he Operation of the S sy tem. The Issuer hereby covenants and agrees with each and every holder of the Notes and Parity Obligations: (a) Maintenance and Efficiency. The Issuer will maintain the System in good condition and operate it in an efficient manner and at reasonable cost. -27- (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 charges otherwise in effect are sufficient to provide Net Revenues at least equal to the requirements of this subsection. (c) Insurance. That 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, or if not so used shall be placed in the Improvement Fund. (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 Obligations upon request. The holders of any of the Notes and Parity Obligations shall have at all reasonable times the right to inspect the System and the records, accounts and data of the Issuer relating thereto. (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 the revenues to the funds specified in this Resolution. (f) Pro e .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 Obligations shall have been provided for in the manner provided in this Resolution; provided, however, that this covenant shall not be construed to -28- 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 to be 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 Obligations shall not be used to pay principal or interest on the Notes or Parity Obligations or for payments into the Sinking or Reserve Funds. (g) Fideli , Bond. The Issuer shall maintain fidelity bond 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) Additional Charges. The Issuer will require proper connecting charges and/or other security for the payment of service charges. (i) 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 Year. Copies of such budget and any amendments thereto shall be provided to the holders of any of the Notes upon request. Section 20. Remedies of Noteholders. Except as herein expressly limited the holder or holders of the Notes and Parity Obligations 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. Section 21. Prior Lien and Parity Obli atm. The Issuer will issue no other notes, bonds 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 Obligations. Additional Obligations may be issued on a parity and equality of rank with the Notes with respect to the lien and claim of such Additional Obligations 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: -29- (a) For the purpose of refunding any of the Notes or Parity Obligations which shall have matured or which shall mature not later than three months after the date of delivery of such refunding obligation and for the payment of which there shall be insufficient money in the Sinking Fund and the Reserve Fund; (b) For the purpose of refunding any outstanding Notes, Parity Obligations or general obligation notes 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 Obligations ranking on a parity are issued, there will have been procured and filed with the City Clerk, a statement of an Independent Auditor, independent financial consultant or a Consulting Engineer 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 1.25 times the maximum amount that will be required in any Fiscal Year prior to the longest maturity of any of the Notes or Parity Obligations for both principal of and interest on all Notes and Parity Obligations then outstanding which are payable from the net earnings of the System and the Additional Obligations 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, independent financial consultant or a Consulting Engineer 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 Obligations been in effect during all of such preceding Fiscal Year. (ii) the Additional Obligations must be payable as to principal and as to interest on the same month and day as the Notes herein authorized. (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. -30- (iv) for the purposes of this Section, general obligation bonds or notes shall be refunded only upon a finding of necessity by the Governing Body and only to the extent the general obligation bonds or notes were issued or the proceeds thereof 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 Additional Obligations. Section 22. Disposition of Proceeds; Arbitrage Not Permitted. The Issuer reasonably expects and covenants that no use will be made of the proceeds from the issuance and sale of the Notes issued hereunder which will cause any of the Notes to be classified as arbitrage bonds within the meaning of Section 148(a) and (b) of the Internal Revenue Code of the United States, and that throughout the term of the Notes it will comply with the requirements of such statute and regulations issued thereunder. To the best knowledge and belief of the Issuer, there are no facts or circumstances that would materially change the foregoing statements or the conclusion that it is not expected that the proceeds of the Notes will be used in a manner that would cause the Notes to be arbitrage bonds. Without limiting the generality of the foregoing, the Issuer hereby agrees to comply with the provisions of the Tax Exemption Certificate and the provisions of the Tax Exemption Certificate are hereby incorporated by reference as part of this Resolution. The Treasurer is hereby directed to make and insert all calculations and determinations necessary to complete the Tax Exemption Certificate in all respects and to execute and deliver the Tax Exemption Certificate at issuance of the Notes to certify as to the reasonable expectations and covenants of the Issuer at that date. T'he Issuer covenants that it will treat as Yield Restricted any proceeds of the Notes remaining unexpended after three years from the issuance and any other funds required by the Tax Exemption Certificate to be so treated. If any investments are held with respect to the Notes and Parity Obligations, the Issuer shall treat the same for the purpose of restricted yield as held in proportion to the original principal amounts of each issue. The Issuer covenants that it will exceed any investment yield restriction provided in this Resolution only in the event that it shall first obtain an opinion of recognized bond counsel that the proposed investment action will not cause the Notes to be classified as -31- arbitrage bonds under Section 148(a) and (b) the Internal Revenue Code or regulations issued thereunder. The Issuer covenants that it will proceed with due diligence to spend the proceeds of the Notes for the purpose set forth in this Resolution. The Issuer further covenants that it will make no change in the use of the proceeds available for the construction of facilities or change in the use of any portion of the facilities constructed therefrom by persons other than the Issuer or the general public unless it has obtained an opinion of bond counsel or a revenue ruling that the proposed project or use will not be of such character as to cause interest on any of the Notes not to be exempt from federal income taxes in the hands of holders other than substantial users of the project, under the provisions of Section 142(a) of the Internal Revenue Code of the United States, related statutes and regulations. Section 23. Additional Covenants, Representations and Warranties of the Issuer. The Issuer certifies and covenants with the purchasers and holders of the Notes from time to time outstanding that the Issuer through its officers, (a) will make such further specific covenants, representations and assurances as may be necessary or advisable; (b) comply with all representations, covenants and assurances contained in the Tax Exemption Certificate, which Tax Exemption Certificate shall constitute a part of the contract between the Issuer and the owners of the Notes; (c) consult with bond counsel (as defined in the Tax Exemption Certificate); (d) pay to the United States, as necessary, such sums of money representing required rebates of excess arbitrage profits relating to the Notes; (e) file such forms, statements and supporting documents as may be required and in a timely manner; and (f) if deemed necessary or advisable by its officers, to employ and pay fiscal agents, financial advisors, attorneys and other persons to assist the Issuer in such compliance. Section 24. Not Qualified Tax-Exempt Obli atg ions. The Notes shall not be designated as qualified tax-exempt obligations as defined by Section 265 (b) of the Internal Revenue Code of the United States, as amended. Section 25. 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 Obligations, or any of them, in any one or more of the following ways: (a) By paying the Notes or Parity Obligations when the same shall become due and payable; and -32- (b) By depositing in trust with the Treasurer, or with a corporate trustee designated by the Governing Body for the payment of the 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 the 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 Obligations 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. Section 26. 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 Obligations, 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 Obligations, and interest due thereon, shall have been satisfied and discharged as provided in this Resolution. Section 27. Amendment of Resolution Without Consent. The Issuer may, without the consent of or notice to any of the holders of the Notes and Parity Obligations, 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 Obligations; 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 Obligations; (b) to change the terms or provisions of this Resolution to the extent necessary to prevent the interest on the Notes or Parity Obligations from being includable within the gross income of the holders thereof for federal income tax purposes; -33- (c) to grant to or confer upon the holders of the Notes or Parity Obligations 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 28. Amendment of Resolution Requirin~~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 Obligations 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 Obligations as may have been issued for the purpose of refunding any of such Notes if such Refunding Obligations shall not then be owned by the Issuer); but this Resolution may not be so amended in such manner as to: (a) Make any change in the maturity of 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 Obligations 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 Note 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 Clerk. Whenever at any time within one year from the date of the mailing of the notice there shall be filed with the Clerk an instrument or instruments executed by the holders of -34- 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 the 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 Obligations. 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 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. 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. Section 29. 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 30. Continuing Disclosure. The Issuer hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate, and the provisions of the Continuing Disclosure Certificate are hereby approved and incorporated by reference as part of this Resolution and made a part hereof and the Mayor and City Clerk are hereby authorized to execute and deliver the same at issuance of the Notes. Notwithstanding any other provision of this Resolution, failure of the Issuer to comply with the Continuing Disclosure Certificate shall not be considered an event of default under this Resolution; however, any holder of the Notes or Beneficial Owner may take such actions as may be necessary and appropriate, including seeking -35- specific performance by court order, to cause the Issuer to comply with its obligations under the Continuing Disclosure Certificate. For purposes of this Section, "Beneficial Owner" means any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Notes (including persons holding Notes through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Notes for federal income tax purposes. Section 31. 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. PASSED AND APPROVED this 23rd day of September , 2008. ATTEST: ~ ~. ~C City erk -36- CIG-3 9/91 CERTIFICATE STATE OF IOWA ) SS COUNTY OF JOHNSON ) I, the undersigned City Clerk of Iowa City, 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 25th day of September , 2008. City C erk, Iowa City, Iowa SEAL 588763.1 \W P 10714.092 i~ NOTICE TO BIDDERS REMOVAL OF FLOOD-RELATED SAND AND DEBRIS FROM CITY PARK Sealed proposals will be received by the City Clerk of the City of Iowa City, Iowa, until 2:30 P.M. on the 23rd day of September, 2008. Sealed proposals will be opened immediately thereafter by the City Engineer or designee. Bids submitted by fax machine shall not be deemed a "sealed bid" for purposes of this Project. Proposals received after this deadline will be returned to the bidder unopened. Proposals will be acted upon by the City Council at a meeting to be held in the Emma J. Harvat Hall at 7:00 P.M. on the 23rd day of September, 2008, or at special meeting called for that purpose. The Project will involve the following: 12,000 CY of CL 10 Excavation, 2,500 LF of Silt Fence and 1 LS for Construction Erosion Control. All work is to be done in strict compliance with the plans and specifications prepared by the Iowa City Engineer's Office, of Iowa City, Iowa, which have heretofore been approved by the City Council, and are on file for public examination in the Office of the City Clerk. Each proposal shall be completed on a form furnished by the City and must be accompanied in a sealed envelope, separate from the one containing the proposal, by a bid bond executed by a corporation authorized to contract as a surety in the State of Iowa, in the sum of 10% of the bid. The bid security shall be made payable to the TREASURER OF THE CITY OF IOWA CITY, IOWA, and shall be forfeited to the City of Iowa City in the event the successful bidder fails to enter into a contract within ten (10) calendar days of the City Council's award of the contract and post bond satisfactory to the City ensuring the faithful performance of the contract and mainte- nance of said Project, if required, pursuant to the provisions of this notice and the other contract documents. Bid bonds of the lowest two or more bidders may be retained for a period of not to exceed fifteen (15) calendar days following award of the contract, or until rejection is made. Other bid bonds will be returned after the canvass and tabulation of bids is completed and reported to the City Council. The successful bidder will be required to furnish a bond in an amount equal to one hundred percent (100%) of the contract price, said bond to be issued by a responsible surety approved by the City, and shall guarantee the prompt payment of all materials and labor, and also protect and save harmless the City from all claims and damages of any kind caused directly or indirectly by the AF-1 operation of the contract, and shall also guarantee the maintenance of the improvement for a period of one (1) year(s) from and after its completion and formal acceptance by the City Council. The following limitations shall apply to this Project: Working Days: 21 Specified Start Date: October 6, 2008 Liquidated Damages: $100.00 per day The plans, specifications and proposed contract documents may be examined at the office of the City Clerk. Copies of said plans and specifications and form of proposal blanks may be secured at the Office of the Iowa City Engineer, Iowa, by bona fide bidders. A $10.00 non-refundable fee is required for each set of plans and specifications provided to bidders or other interested persons. The fee shall be in the form of a check, made payable to the City of Iowa City. Prospective bidders are advised that the City of Iowa City desires to employ minority contractors and subcontractors on City projects. A listing of minority contractors can be obtained from the Iowa Department of Economic Development at (515) 242-4721 and the Iowa Department of Transportation Contracts Office at (515) 239- 1422. Bidders shall list on the Form of Proposal the names of persons, firms, companies or other parties with whom the bidder intends to subcon- tract. This list shall include the type of work and approximate subcontract amount(s). The Contractor awarded the contract shall submit a list on the Form of Agreement of the proposed subcontractors, together with quantities, unit prices and extended dollar amounts. By virtue of statutory authority, preference must be given to products and provisions grown and coal produced within the State of Iowa, and to Iowa domestic labor, to the extent lawfully re- quired under Iowa Statutes. The Iowa reciprocal resident bidder preference law applies to this Project. The City reserves the right to reject any or all proposals, and also reserves the right to waive technicalities and irregularities. Published upon order of the City Council of Iowa City, Iowa. MARIAN K. KARR, CITY CLERK AF-2 12 Prepared by: Ron Knoche, City Engineer, 410 E. Washington St., Iowa City, IA 52240 (319)356-5138 RESOLUTION NO. RESOLUTION AWARDING CONTRACT AND AUTHORIZING THE MAYOR TO SIGN AND THE CITY CLERK TO ATTEST A CONTRACT FOR THE REMOVAL OF FLOOD-RELATED S,p-ND AND DEBRIS FROM CITY PARK. WHEREAS, of responsible bid of $ for co t n of the above-na has' submitted the lowest NOW, THEREFORE, BE IT RESOLVED Y THE CITY CO CIL OF THE CITY OF IOWA CITY, IOWA, THAT: 1. The contract for the construction of th above- amed project is hereby awarded to ub' ct to the condition that awardee secure adequate performance and payment bond, ins nce certificates, and contract compliance program statements. 2. The Mayor is hereby authorized to sig and the Ci Clerk to attest the contract for construction of the above-named proj t, subject to the ondition that awardee secure adequate performance and payment nd, insurance certific es, and contract compliance program statements. 3. The Parks and Recreation Direq{or is authorized to execute Chang orders as they may become necessary in the cons uction of the above-named project. Passed and approved this ~_ day of ATTEST: CITY CLERK 20 MAYOR Approved by City Attorney's Office It was moved by and seconded by adopted, and upon roll call there were: AYES: NAYS: ABSENT: Bailey Champion Correia Hayek O'Donnell Wilburn Wright the Resolution be PW ENG\RES\sand&debrisremoval.doc M ~ ~- 1 Prepared by: Ron Knoche, City Engineer, 410 E. Washington St., Iowa City, IA 52240 (319)356-5138 RESOLUTION NO. nR-~~ RESOLUTION AWARDING CONTRACT AND AUTHORIZING THE MAYOR TO SIGN AND THE CITY CLERK TO ATTEST A CONTRACT FOR THE REMOVAL OF FLOOD-RELATED SAND AND DEBRIS FROM CITY PARK. WHEREAS, DeLong Construction Inc. of Washington, Iowa, has submitted the lowest responsible bid of $99,000.00 for construction of the above-named project. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IOWA, THAT: 1. The contract for the construction of the above-named project is hereby awarded to DeLong Construction, Inc., subject to the condition that awardee secure adequate performance and payment bond, insurance certificates, and contract compliance program statements. 2. The Mayor is hereby authorized to sign and the City Clerk to attest the contract for construction of the above-named project, subject to the condition that awardee secure adequate performance and payment bond, insurance certificates, and contract compliance program statements. 3. The Parks and Recreation Director is authorized to execute change orders as they may become necessary in the construction of the above-named project. Passed and approved this 23rd day of ATTEST: Yc - CITY LERK amhar 20 08 It was moved by Champion and seconded by 0' Donnell the Resolution be adopted, and upon roll call there were: AYES: x ~- x X ~- x -sY- NAYS: ABSENT: Bailey Champion Correia Hayek O'Donnell Wilburn Wright PWEN G\RES\sand&debrisremoval.doc City Attorney's Office q~a.3lo8' NOTICE TO BIDDERS WATERWORKS PRAIRIE PARK FISHING PIER IOWA CITY, IOWA Sealed proposals will be received by the City Clerk of the City of Iowa City, Iowa, until 2:30 P.M. on the 18th day of September, 2008. Sealed proposals will be opened immediately thereafter by the City Engineer or designee. Bids submitted by fax machine shall not be deemed a "sealed bid" for purposes of this Project. Proposals received after this deadline will be returned to the bidder unopened. Proposals will be acted upon by the City Council at a meeting to be held in the Emma J. Harvat Hall at 7:00 P.M. on the 23~d day of September, 2008, or at special meeting called for that purpose. The Project will involve the following: CONSTRUCTION OF A FISHING PIER, PCC TRAIL AND ALL OTHER WORK AS INCLUDED IN THE PLANS AND SPECIFICATIONS All work is to be done in strict compliance with the plans and specifications prepared by VJ Engineering, Coralville, Iowa, which have hereto- fore been approved by the City Council, and are on file for public examination in the Office of the City Clerk. Each proposal shall be completed on a form furnished by the City and must be accompanied in a sealed envelope, separate from the one containing the proposal, by a bid bond executed by a corporation authorized to contract as a surety in the State of Iowa, in the sum of 10% of the bid. The bid security shall be made payable to the TREASURER OF THE CITY OF IOWA CITY, IOWA, and shall be forfeited to the City of Iowa City in the event the successful bidder fails to enter into a contract within ten (10) calendar days of the City Council's award of the contract and post bond satisfactory to the City ensuring the faithful performance of the contract and mainte- nance of said Project, if required, pursuant to the provisions of this notice and the other contract documents. Bid bonds of the lowest two or more bidders may be retained for a period of not to exceed fifteen (15) calendar days following award of the contract, or until rejection is made. Other bid bonds will be returned after the canvass and tabulation of bids is completed and reported to the City Council. The successful bidder will be required to furnish a bond in an amount equal to one hundred AF-1 percent (100°/0) of the contract price, said bond to be issued by a responsible surety approved by the City, and shall guarantee the prompt payment of all materials and labor, and also protect and save harmless the City from all claims and damages of any kind caused directly or indirectly by the operation of the contract, and shall also guarantee the maintenance of the improvement for a period of two (2) year(s) from and after its completion and formal acceptance by the City Council. The following limitations shall apply to this Project: Specified Start Date: October 1St. 2008 Specified End Date: May 1St, 2009 The plans, specifications and proposed contract documents may be examined at the office of the City Clerk. Copies of said plans and specifications and form of proposal blanks may be secured at the Office of VJ Engineering, 2570 Holiday Road, Coralville, Iowa, 319-338-4939, by bona fide bidders. A $ 30 non-refundable fee is required for each set of plans and specifications provided to bidders or other interested persons. The fee shall be in the form of a check, made payable to VJ Engineering. Prospective bidders are advised that the City of Iowa City desires to employ minority contractors and subcontractors on City projects. A listing of minority contractors can be obtained from the Iowa Department of Economic Development at (515) 242-4721 and the Iowa Department of Transportation Contracts Office at (515) 239- 1422. Bidders shall list on the Form of Proposal the names of persons, firms, companies or other parties with whom the bidder intends to subcon- tract. This list shall include the type of work and approximate subcontract amount(s). The Contractor awarded the contract shall submit a list on the Form of Agreement of the proposed subcontractors, together with quantities, unit prices and extended dollar amounts. By virtue of statutory authority, preference must be given to products and provisions grown and coal produced within the State of Iowa, and to Iowa domestic labor, to the extent lawfully re- quired under Iowa Statutes. The Iowa reciprocal resident bidder preference law applies to this Project. The City reserves the right to reject any or all proposals, and also reserves the right to waive technicalities and irregularities. Published upon order of the City Council of Iowa City, Iowa. MARIAN K. KARR, CITY CLERK AF-2 ~~ .city of Iowa city PARKS AND RECREATION DEPARTMENT 220 S. Gilbert Street TO: City Council FROM: Terry Trueblood DATE: September 22, 2008 RE: Waterworks Prairie Park Fishing Pier Project Item 13 on your September 23rd agenda is to consider a resolution awarding a contract for the construction of the Waterworks Prairie Park Fishing Pier Project. Bids for this project were opened Thursday, September 18. Only one bid was received as follows: Peterson Contractors Inc. Reinbeck, IA $167,771.00 Engineer's Estimate $150,667.25 Even though we received only one bid, which is 11.35% over the engineer's estimate, the City Engineer and I recommend proceeding with the project. The engineering firm we hired to do the design work believes that the uniqueness of the project, limited access to the site, the fact that much of it needs to be constructed over water and the busy schedules of qualified contractors contributed to the higher than expected price and the number of bidders. While the bidding climate may improve in six to twelve months, steel prices continue to increase rapidly, and $61,000 of this project is directly related to steel. Thus any cost savings due to a better bidding climate could very well be offset by the increase in steel prices. The funding source for this project is G.O. Bonds. Sufficient funding exists within the Parks and Recreation capital improvement budget to cover the cost. ~~ Prepared by: Terry Trueblood, Parks & Recreation Director, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5030 RESOLUTION NO. 08-293 RESOLUTION AWARDING CONTRACT AND AUTHORIZING THE MAYOR TO SIGN AND THE CITY CLERK TO ATTEST A CONTRACT FOR CONSTRUCTION OF THE WATERWORKS PRAIRIE PARK FISHING PIER PROJECT. WHEREAS, Peterson Contractors, Inc. of Reinbeck, Iowa, has submitted the lowest responsible, responsive bid of $167,771 for the construction of the above-named project. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IOWA, THAT: 1. The contract for the construction of the above-named project is hereby awarded to Peterson Contractors, Inc., subject to the condition that the awardee secure adequate performance and payment bond, insurance certificates, and contract compliance program statements. 2. The mayor is hereby authorized to sign and the City Clerk to attest the contract for construction of the above-named project, subject to the condition that the awardee secure adequate performance and payment bond, insurance certificates, and contract compliance program statements. 3. The Parks and Recreation Director is hereby authorized to execute change orders as may become necessary in the construction of the above-named project. Passed and approved this 23rd day of Sevtember , 2008. ATTEST: CITY ~~~~p~~ZGy~ ~~~~ Attorney's Office ~ /~ a /v ~ It was moved by Champion and seconded by 0' Donnell that the Resolution be adopted, and upon roll call there were: AYES: NAYS: ABSENT: x Bailey x Champion x Correia x Hayek x O'Donnell x Wilburn x Wright 13 Prepared by: Terry Trueblood, Parks and Recreation Director, 410 E. Washington St., Iowa City, IA 52240 (319)356-5110 RESOLUTION NO. RESOLUTION AWARDING CONTRACT AND AUTHORIZING THE AYOR TO SIGN AND THE CITY CLERK TO ATTEST A CONT CT FOR CONSTRUCTION OF THE WATERWORKS PRAIRIE PARK F SHING PIER PROJECT. WHEREAS, responsible bid of $ for NOW, THEREFORE, BE IT RESOL CITY, IOWA, THAT: of has/ submitted the lowest of the above-named p sect. BY THE CITY COUNCIL OF THE CITY OF IOWA 1. The contract for the construction of adequate performance and payment bond, program statements. above-named project is hereby awarded to subject tot condition that awardee secure nsurance ce ificates, and contract compliance 2. The Mayor is hereby authorized to sign and he ity Clerk to attest the contract for construction of the above-named project, subje o the condition that awardee secure adequate performance and payment bond, insura a certificates, and contract compliance program statements. 3. The Parks and Recreation Director is author' ed to ex cute change orders as they may become necessary in the construction of the above-name project. Passed and approved this day of , 20 MAYOR Approved by ATTEST: CITY CLERK It was moved by adopted, and upon roll call there we AYES: City Attorney's ~ and seconded by a Resolution be NAYS: ABSENT: Bailey Champion Correia Hayek O'Donnell Wilburn Wright PW ENG\RES\W W PPFishingPier.doc ~- /`°f Prepared by: Susan Dulek, Asst. City Atty., 410 E. Washington St., Iowa City, IA 52240 (319) 356-5030 RESOLUTION NO. 08-294 RESOLUTION APPROVING A SETTLEMENT AGREEMENT WITH ONE POOR STUDENT, INC., D/B/A ONE-EYED JAKE'S. WHEREAS, on February 9, 2007 the City issued Haywood Belle and One Poor Student, Inc., d/b/a One-Eyed Jake's (OEJ's) a municipal infraction citation for having a stairway less than 44 inches in width at 18-20 S. Clinton Street, Iowa City, Iowa, in violation of the City Fire Code. City v. Belle and One Poor Student, Inc., Johnson County No. SCSC 066977; WHEREAS, the trial on the municipal infraction is scheduled for September 29 and 30, 2008; WHEREAS, on January 29,2008, the City Council denied OEJ's application to renew its Class C Liquor License as recommended by the City Fire Department; WHEREAS, OEJ's appealed the denial of the liquor license to the Alcoholic Beverages Division (ABD). In re One Poor Student, Inc., d/b/a One-Eyed Jake's, Docket No. A-2008- 00003; WHEREAS, the hearing before the ABD is pending the resolution of the municipal infraction; and WHEREAS, it is in the public interest to enter into an agreement with OEJ's in settlement of the issues raised in district court and before the ABD. NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE. CITY COUNCIL OF IOWA CITY, IOWA, THAT: The attached Settlement Agreement is approved, and the Mayor and the City Attorney are authorized to sign said agreement. Passed and approved this ~~ra day of Approved: ~ g^da~ City Attorney's Office ATTEST: / /I~.ta~x~.y ~ • 7C~~4~t_J CITY CL RK Resolution No Page 2 08-294 It was moved by Wight and seconded by 0' Donnell the Resolution be adopted, and upon roll call there were: AYES: x x x x x x NAYS: ABSENT: Bailey Champion Correia Hayek O'Donnell Wilburn Wright ABSTAIN: x wpdata/glossary/resolution-ic.doc SETTLEMENT AGREEMENT WHEREAS, on February 9, 2007 the City of Iowa (City) issued Haywood Belle and One Poor Student, Inc., d/b/a One-Eyed Jake's (OEJ's) a municipal infraction under Iowa Code §364.22 (2007) for having a stairway less than 44 inches in width at 18-20 S. Clinton Street, Iowa City, Iowa, in violation of the City Fire Code. City v. Belle and One Poor Student, Inc., Johnson County No. SCSC 066977; WHEREAS, Haywood Belle is the owner of 18-20 S. Clinton Street, Iowa City, Iowa, which is a three-floor commercial structure, and OEJ's leases the second and third floors; WHEREAS, OEJ's and Haywood Belle have pled not guilty to the charge contained in the municipal infraction; WHEREAS, the trial on the municipal infraction is scheduled for September 29 and 30, 2008; WHEREAS, on January 29, 2008, the City Council denied OEJ's application to renew its Class C Liquor License as recommended by the City Fire Department; WHEREAS, OEJ's appealed the denial of the liquor license to the Alcoholic Beverages Division (ABD). In re One Poor Student, Inc., d/b/a One-Eyed Jake's, Docket No. A-2008- 00003; WHEREAS, the hearing before the ABD is pending the resolution of the municipal infraction; and WHEREAS, the City and OEJ's wish to enter into an agreement in settlement of the issues raised in district court and before the ABD. IT IS THEREFORE AGREED AS FOLLOWS: This agreement is entered into to compromise disputed claims between the parties and in no way is an admission by either of the parties as to any claim. Municipal Infraction 2. OEJ's will increase the width of the front stairway (stairway) at 18-20 S. Clinton Street, Iowa City, Iowa to 44 inches no later than December 31, 2009. Prior to commencement of the stairway remodel, OEJ's will submit the remodel plans to the City, and the City will certify that said plans will bring the stairway into full compliance with the Fire Code, subject to final inspection by the City to ensure conformity with the remodel plans. 3. The City will file a motion to continue the trial to a date certain after December 31, 2009 in order to accommodate the terms of this agreement. 4. After final inspection by the City and determination that the remodeled stairway complies with the Fire Code as provided in Paragraph 2 above, the City will dismiss the municipal infraction citation with prejudice at cost to OEJ's. 5. If the Court will not agree to continue this matter to a date certain after after December 31, 2009, the City will dismiss the infraction without prejudice at cost to OEJ's. If the City re-files the municipal infraction citation after December 31, 2009 because the stairway does not comply with the Fire Code, OEJ's will cooperate with scheduling a prompt trial of the matter. Liquor License 6. The City will withdraw the denial of OEJ's application to renew its liquor license and will .thereafter approve the application. The City will notify the ABD of the withdrawal and the subsequent approval of the liquor license. 7. At the next renewal of OEJ's liquor license scheduled for January 2009, City Fire Department staff will not recommend to the Iowa City City Council that the license should be