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2003-11-25 Correspondence
IOWA CITY POLICE DEPARTMENT 410 EAST WASHINGTON STI~EET, IOWA CITY, IA 52240 (319) 356-5275 FAX#(319) 356-5449 "An Accredited Police Department" To: Steve Atkins From: RJ Winkelhake Ref: Bicyclist of Iowa City Officer Humrichouse had met with members of BIC earlier in 2003 to discuss the Bike Patrol of the Iowa City Police Department. As a result of that meeting the decision was made to make a contribution to the program. At the City council meeting on 25 November 2003 Mr. Steve Rudin representing the Bicyclists of Iowa City will present checks to Officer Greg Humrichouse to assist the Iowa City police Department to provide additional patrol time along the trail system of Iowa City. BIC matched the funds collected for the program. Marian Karr From: Lisa Mollenhauer Sent: Friday, November 14, 2003 4:22 PM To: 'lucyann-brignola@uiowa.ed u' Cc: *City Council Subject: RE: recreational center question Lucy Ann, Your email to Council will be accepted on their next Formal Agenda Consent Calendar as a permanent, public record. You should contact Council Members via telephone if you wish to interact with them. You can access contact information at: http://www.icgov.org/citycouncil.htm Good luck with your project. Lisa Lisa Mollenhauer Administrative Assistant to the City Manager City of Iowa City 410 E Washington Street Iowa City, IA 52240 (319) 356-5010 ..... Original Message ..... From: lucyann-brignola@uiowa.edu [mailto:lucyann-brignola@uiowa.edu] Sent: Friday, November 14, 2003 4:12 PM To: council@iowa-city.org Subject: recreational center question To whom it may concern, My name is Lucy Ann Brignola and I am a UI sophomore. For a paper, I am to create a utopian campus for the University of Iowa. My one idea focuses the building of a recreational center across from the Mayflower dormitory. My center would include mini-golf, driving ranges, an ice rink, and an outdoor pool. The idea is to create a place where UI students can hang out other than the bars. I know that there is a present skate park that was recently built across from Mayflower. I thought that the recreational center would fit perfectly with the skate park. I would like to know your ideas on this issue: would it be possible to do this project jointly with the University of Iowa? What would be some of the concerns you would have or the benefits that it could create? If you could get back to me, I would greatly appreciate it. Thank you for your time. Sincerely, ! Lucy Ann Brignola FILED 003 NOV 13 lO: 76 222N. Clinton Iowa City, IA 52242 To Whom It May Concern: IOWA OIl-E, IOWA I would like to talk to you about the bar scene in Iowa City. I find that the fact that the city raised the age to 19 to be in the bars after 10 ridiculous. It just moves the problem from the bars to the dorms and house parties. I would think it would be safer to have kids drinking at the bars where they'd be thrown out for being belligerently drunk or to the point where they're passing out: I_t_~nk the presence of security at bars is more apt to stop the use of date rape drugs whereas at a house party there is no security. I also think that stopping underage drinking is a futile battle. Hopefully I can effectively outline some of these points. First, raising the age to get into bars doesn't really solve anything, except for moving a lot of underage drinking out of downtown. The kids that are 19 are still in the bars drinking at will. The kids that aren't 19 are just going to house parties where they can drink as much as they please for five dollars. This is a lot cheaper than going to bars but they generally don't have liquor. Plus, if it's a large gathering the people having this party can go get more kegs before 2 a.m. and keep the party going well after bar dose. So these kids probably consume even more alcohol than they do at bars. There is also no security at house parties. Generally, admission is gained by knowing somebody who's throwing it or knowing people, who know people etc., but sometimes the people throwing the party don't care who wanders in their door so long as they get their money. Who knows what drugs and such random people are going to have on them, and without bouncers who will keep order? Who will be on the lookout for a date rape? Finally stopping the underage drinking is just too hard. I'm sure you know this. It seems like the enforcement is generally directed at a person who is being belligerently drunk and looking to get hurt. That or kids who make it obvious they are underage and therefore easy to write out the tickets that are the lifeblood income of the city. In conclusion I would just ask that you don't take offense to this letter. I was just outlining a few points. I'm sure they've been made before. I hope that my commentary on: the migration of underage drinking to house parties, how safe those house parties are and the challenges of law enforcement raised interesting points Sincerely, Brandon Zeigler Derek Sehairer 100 Hillcrest Hail Iowa City, IA 52242 t 1/9/2003 Council Members 410 E. Washington St. Iowa City, tA 52240 Dear Council Members, My name is Derek Schairer and I am writing to you about the t9 and over ordinance that is ongoing in Iowa City. As a sophomore here at the University of Iowa I have read a lot about this debate over the past year and feel very strongly about this issue. I would like to share my opinion on this matter before it is put to another vote this spring. Since I am a college student, and this ordinance is mainly focused on my age group, I have experienced its effects first hand. After participating in, and observing, the "college scene" for over a year now, I believe that the age to enter a bar should remain at 19. In my opinion, any age older than 19 would be detrimental to Iowa City and the students who reside hem. The ordinance seems to be having the desired affect and it is aiso being properly enforced. If the age is raised to 21 this would create an unsafe environment for students and the city. This is because the popularity of"house pa~es" would increase and put students in unsupervised places over a large are~ If most students go to a bar downtown they can be supervised by the bar's staff and the police that patrol the area. This creates a safer environment for the students because of the fact that there is constant supervision. Drug use is also curtailed by this supervision, where at a "house party" illegai drugs are easier to buy, sell, and use. The bars provide a fun sociai atmosphere where young adults can gather to dance and have a good time. College age drinking wilt never cease to exist. It is something that is ingrained in our society and culture. As a registered voter I would like to encourage the city council to keep the age limit at 19 to enter a bar in Iowa City. It is the best way to handle and monitor drinking in Iowa City for its residents and students. Thank you for your time and keep up the great work. Thank you. Sincerely, Derek Sehairer · ~ '.': ~ Peri Kaplan 121 East Davenport St. #23 Iowa City, IA 52240 2~3140'~ I City Council C, LE K 410 East Washington St. IOWA Cl~X{' Iowa City, 52240 November 9, 2003 Dear Members of City Council, I am writing to you for an assignment in one of my classes at the University of Iowa. Our assignment is to pick an issue that we feel strongly about and write to someone who is in the deeision-making position about this issue. The issue I am concerned about is the underage bar problem in downtown Iowa City. You probably receive many letters about this, but please listen to my point of view. I am a senior at the University of Iowa this year and just heard about the fines that underage people have to pay if caught at a bar establishment after 10 pm. After listening to an Iowa City police officer at my sorority house explain how much an underage individual had to pay if caught in a bar at, er 10 pm with a drink in their hand, I realized that the city of Iowa City does not help this at all. I am not going to lie, but a big reason I came to the University of Iowa was because I had visited in high school and had the chance to go out downtown on a Friday and Saturday night. The social life in Iowa City pushed my decision to come to the University. I believe this is how many students choose where to go. My concern is that if the city is going to charge the students around $500 for drinking at a bar after 10, then there should be many alternatives of activities for these people. I have heard of 24/7, but this is not for everyone on Thursday nights. Many underage people can go to a movie, but the Old Capital movie theater usually has 3 movies theaters not giving much cfa choice for the students. Other movie theaters and ice skating is too far away as well. I feel that if you are going to make such a problem for underage people to be in bar after 10, then there should be a lot more activities around the downtown area for these individuals to get involved with. The money that these people pay when fined, should go towards a new larger recreational center that is open till 2 am for some of these people. A new movie theater and ice rink should be built closer to campus. Mom concerts should be available to entertain these underage individuals. We need to think of mom solutions to keep tbese people out of the bars if we threaten to fine them if caught. I really feel that we need to do something about this or else we are going to push many students away from coming to this University. We n~l to consider that many IXaaple do not go to the bar to drink. Many people go to listen to music, dance, or just hang out with friends. I really appreciate you listening to my view on this. Sin~fir,~ly, . 410 E. Washington Street Iowa City, IA 52240 Dear Mayor Lehman, I came to Iowa City from Minnesota the weekend of September 27, 2003 and I cannot believe what happened. See if it makes sense to you. While waiting for my daughter to finish with her sports activity at the U of I at about 10:15 PM on Saturday, I drove to her apartment at 333 Gilbert to drop offsome food, clothing, etc. I parked in an open parking space in the lot. There were not any signs to indicate that only tenants were allowed to park there. I spent 20-25 minutes unloading the car and bringing the items into her apartment. When I returned afier the last trip the car was gone. I immediately thought it had been stolen because there were no signs posted that stated that "Unauthorized cars would be towed". I called the Property Manager and they informed me that all towing is authorized by the Police after writing a ticket and calling the Property Manager. They had not been called so I thought my rental car had been stolen. I called 911 to report the loss and was informed the Police had authorized a tow. "From private property" I asked, "and without a posted sign?" The officer informed me that it did not need to be posted because you do not post a sign in your driveway for unauthorized parking. No, I thought, but a car blocking a driveway is illegally parked and can be towed by the Police. A car in your driveway is not a city problem-nor is a car in a private parking lot that is not blocking an entrance or exit. It is a private property problem and a note would be a good first warning unless there were posted warning signs. I was informed I would need to find City hall, pay a $10 fine and receive a release form so I could ride out in the country to get my car. Both the Police and the towing company quoted me a price of $53 even though the towing company was closed for the evening. I would have to wait until 7AM. Now I was stuck-no warning tick~ as a speeder or minor traffic offender might receive-and without a ear to get to our motel. I paid the $10 fine that night. I arrived at the remote towing lot at 10:45 AM and was ready to pay the $53, I was t~t i,~t wa~:~ now $69 because of $8/day storage. "For less than 12 hours?" I asked. Two c, alendar~la~., TI~ price quote was good if I arrived at 7AM-and I was never told this by anyone. O -< · ' I know extortion when I see it. They had my car and I had no r~.,ourse-the Pohce we~,a ]~ involved and I was probably outside of Iowa City. As I drove back to Iowa City I looked in the back seat and noticed my wife's two copier boxes full of files for her 1~ grade class were dumped-one upside down and one on the floor. It took her three hours and many tears to reconstruct these files that were jostled and dumped by the tow truck. These questions come to mind: 1) In times of economic distress, why would Iowa City want to become a party to private party parking violations for $10 a ticket? Is it worth the officer's time for a "violation" that does little, if any, to Protect and To Serve the citizens and visitors to Iowa City when a warning would be a positive way to deal with a problem? Maybe after a warning and then overnight before a tow-especially for an out of state vehicle. A license database would be easy to maintain. 2) Why are renters allowed to have vehicles towed from stalls they only rent and are not posted with a warning sign? An expensive and needless "lesson" for a visitor to your city. 3) Why would I now not associate Iowa City with a towing company that extorts money to meet their fee schedule? Wouldn't one also wonder if there is a kickback relationship? Is there a city contract and are they meeting the prescribed fee schedule-or is their even one to protect Iowa City's image from less than scrupulous operators? 4) What about the liability issue if the car is damaged while being towed and the towing company refuses to pay? Does Iowa City really want to get in the property adjustment business when a she says/he says damage dispute arises from a tow? The word I am looking for to describe this event is unconscionable. To encourage apartment dwellers to call and request a dcket and a tow t~or a unique and unposte~ pr~vafe paring rule violation is beyond the limits of municipal conduct. To be a part of this is, if not illegal, beyond ethical in terms of becoming a part of private parking "disputes". And, to allow a city contracted or, at least endorsed, towing company to charge any amount for a city authorized tow is endorsing extortion. © ,=:,~' I await your response, cz>~ Dave Vail ~-~ .'7. 296 Hallam Curve ._ St. Paul, MN 55115 cc: City Manager Stev~Atki,~, City Attorney Eleanor Dilkes, Parking and Transit Director Joe Fowler, Police ChiefR. J. Winkelhake. ~oNo Big 10 University Towing wo No 24 HourTowing 3309 HVVY. I S.W. /"~7 'tz~,'/1'~ ~1~ & IOWA CITY. IOWA 52240 ~ . TiME OUT Starting Service PHONE: 354-5936 DESCRIPTION AMOUNT TAX EGISTERED OWNER ~,l i~A !. ~r ~II NOT RESPONSIBLE FOR DAMAGE TO VEHICLE ~ z ~ ~o O ~m ,, ~m~ 5'~: ~ ~[ ~ m~mom~ ~ ~ ~ ~[ I. ~ .z ~, o oooooo3~3o~ ~ ~ ~ Page 1 of 1 Marian Karr From: Stephanie [Amethyst@pacbelL net] Sent: Thursday, November '13, 2003 12:15 PM To: cou ncil@iowa-city,org Subject: Mutt Mitt idea Hello, I do not Jive in Iowa City, or even Iowa for that matter, but I read about your Mutt Mit~ on an online newspaper. What a wonderful idea! I live in California, near a park that is used for dog-walking. I'm fired of bringing my children to play at the park and picking up other peoples dog poop. If I wanted to pick up dog poop, I would get a dog! I have forwarded the article to our city council in hopes that they will adopt it. The article I read was concerning the cost of the Mutt Mitt program. I believe that I may have a solution for you. You could slightly raise the dog licensing fee to compensate for the cost of the Mutt Mitt program. That way the people that are utilizing the Mutt Mitts are the ones paying for it. Thank you for your time, Stephania Cheng 11/13/03 Page 1 of 1 Marian Karr From: LEON GILLIAM [snagg3@msn.com] Sent: Wednesday, November 19, 2003 9:15 AM To: co u ncil@iowa-city.org Subject: descrimation Good Morning my name is Herman D.Thornton I writing writing this letter because I am very upset about the the service my nice and her friend received at one of your iowa city resturants( vine )on wed. nov 12. she and her guest were refused service.they were told (quote/unquote) by the waistres and the manager on duty they werent going to serve them go to another resturant and eat.she as asked for the corporate number and was told there wasn't any.] [ cant believe this goes on in iowa city ! would like for this to checked into at once with a reply back to me please.they were tho only african american in the estalisment this sounds like race decrimanation to me. ~' hope ! don't have to take luther steps. thanks for your time Herman D.Thornton 11/19/03 City of Iowa City MEMORANDUM Date: November 14, 2003 To: City Clerk .r From: Anissa Williams, Traffic Engineering Planner 0 Re: Item for November 25, 2003 City Council meeting: Installation of RIGHT LANE MUST TURN RIGHT sign As directed by Title 9, Chapter 1, Section 3A of the City Code, this is to advise the City Council of the following action. Action: Pursuant to Section 9-1-3A(8), signage indicating RIGHT LANE MUST TURN RIGHT will be installed on the east side of Clinton Street just south of Jefferson Street for northbound vehicles. Comment: This action is being taken to clarify lane usage as Clinton Street changes from a four-lane street to a two-lane street at Jefferson Street. ppdad m/mem/clinton-jefferson.doc The CongrGat nal Church UNITED CHURCH OF CHRIST 30 N. Clinton St. Iowa City, Iowa 52245 (319) 337-4301 Dr. Bruce W. Fischer, Pastor Robin Chambers, Director of Christian Education November 2 I, 2003 Council Member Connie Champion 410 E. Washington St. Iowa City, Iowa 52240 Dear Council Member Connie Champion: I want to thank you for all your support given to the cause of the homeless in the Iowa City area. Your reputation for having a listening ear, and for being open to assist the Shelter House is know. As the Shelter House moves forward to build another badly needed facility, i hope your will continue your interest and support for this cause. In the interim between now and the completion of a new facility, there is great unmeet need for emergency shelter. I am a part of an ad hoc group trying to locate and staffan overflow shelter facility for this winter and next. Although made up of members of local religious groups, we believe this need is a community wide problem, and therefore ask for the assistance from the City Council to find a place to house the homeless. The Recreation Center of Iowa City might be just that place. I ask that you bring before the City Council the possibility of using the Recreation Center to accommodate the overflow from the Shelter House. I would be willing to mobilize people from our group and the Shelter House to speak to the City Council. Again, I thank you for your past interest and support for issue of the homeless in our area. Sincerely, Bruce W. Fischer 11-25-03 15 TAX EXEMPTION CERTIFICATE of IOWA CITY, IOWA, ISSUER $5,570,000 General Obligation Bonds, Series 2003 This instrument was prepared by: Ahlers & Cooney, P.C. 100 Court Avenue, Suite 600 Des Moines, Iowa 50309 (515) 243-7611 TABLE OF CONTENTS This Table of Contents is not a part of this Tax Exemption Certificate and is provided only for convenience of reference. INTRODUCTION ....................................................... 1 ARTICLE I DEFINITIONS .......................................................... 1 ARTICLE II SPECIFIC CERTIFICATIONS, REPRESENTATIONS AND AGREEMENTS Section 2.1 Authority to Certify and Expectations .............................. 5 Section 2.2 Receipts and Expenditures of Sale Proceeds ......................... 8 Section 2.3 Purpose of Bonds .............................................. 8 Section 2.4 Facts Supporting Tax-Exemption Classification ...................... 8 Section 2.5 Facts Supporting Temporary Periods for Proceeds .................... 9 Section 2.6 Resolution Funds at Restricted or Unrestricted Yield .................. 9 Section 2.7 Pertaining to Yields ........................................... 10 ARTICLE III REBATE Section 3.1 Records .................................................... 11 Section 3.2 Rebate Fund ................................................. 11 Section 3.3 Exceptions to Rebate .......................................... 12 -i- Section 3.4 Calculation of Rebate Amount ...................................13 Section 3.5 Rebate Requirements and the Bond Fund ..........................13 Section 3.6 Investment of the Rebate Fund ..................................14 Section 3.7 Payment to the United States .................................... 14 Section 3.8 Records .................................................... 15 Section 3.9 Additional Payments .......................................... 15 ARTICLE IV INVESTMENT RESTRICTIONS Section 4.1 Avoidance of Prohibited Payments ...............................16 Section 4.2 Market Price Requirement ...................................... 16 Section 4.3 Investment in Certificates of Deposit ............................. 16 Section 4.4 Investment Pursuant to Investment Contracts and Agreements .......... 17 Section 4.5 Records .................................................... 17 Section 4.6 Investments to be Legal ........................................17 ARTICLE V GENERAL COVENANTS ............................................... 18 ARTICLE VI AMENDMENTS AND ADDITIONAL AGREEMENTS Section 6.1 Opinion of Bond Counsel; Amendments ........................... 18 Section 6.2 Additional Covenants, Agreements ...............................18 -ii- Section 6.3 Amendments ................................................ 18 ARTICLE VII QUALIFIED TAX EXEMPT OBLIGATIONS ............................... 19 Signature and Seal ...................................................... 19 EXHIBIT "A" - VERIFICATION CERTIFICATE OF THE PURCHASER -iii- TAX EXEMPTION CERTIFICATE CITY OF IOWA CITY, IOWA THIS TAX EXEMPTION CERTIFICATE made and entered into on ~v e)'7 ~) ^ 5 9& ,2003, by the City of Iowa City, State of Iowa (the "Issuer"). INTRODUCTION This Certificate is executed and delivered in connection with the issuance by the Issuer of its $5,570,000 General Obligation Bonds, Series 2003 (the "Bonds"). The Bonds are issued pursuant to the provisions of the Resolution of the Issuer authorizing the issuance of the Bonds. Such Resolution provides that the covenants contained in this Certificate constitute a part of the Issuer's contract with the owners of the Bonds. The Issuer recognizes that under the Code (as defined below) the tax-exempt status of the interest received by the owners of the Bonds is dependent upon, among other things, the facts, circumstances, and reasonable expectations of the Issuer as to future facts not in existence at this time, as well as the observance of certain covenants in the future. The Issuer covenants that it will take such action with respect to the Bonds as may be required by the Code, and pertinent legal regulations issued thereunder in order to establish and maintain the tax-exempt status of the Bonds, including the observance of all specific covenants contained in the Resolution and this Certificate. ARTICLE I DEFINITIONS The following terms as used in this Certificate shall have the meanings set forth below. The terms defined in the Resolution shall retain the meanings set forth therein when used in this Certificate. Other terms used in this Certificate shall have the meanings set forth in the Code or in the Regulations. "Annual Debt Service" means the principal of and interest on the Bonds scheduled to be paid during a given Bond Year. "Bonds" means the $5,570,000 aggregate principal amount of General Obligation Bonds, Series 2003, of the Issuer issued in registered form pursuant to the Resolution. -1- "Bond Counsel" means Ahlers & Cooney, P.C., Des Moines, Iowa, or an attorney at law or a firm of attorneys of nationally recognized standing in matters pertaining to the tax-exempt status of interest on obligations issued by states and their political subdivisions, duly admitted to the practice of law before the highest court of any State of the United States of America. "Bond Fund" means the Sinking Fund described in the Resolution. "Bond Year" as defined in Regulation 1.148-1(b), means a one-year period beginning on the day after expiration of the preceding Bond Year. The first Bond Year shall be the one-year or shorter period beginning on the Closing Date and ending on a principal or interest payment date, unless Issuer selects another date. "Bond Yield" means that discount rate which produces an amount equal to the Issue Price of the Bonds when used in computing the present value of all payments of principal and interest to be paid on the Bonds using semiannual compounding on a 360- day year as computed under Regulation 1.148-4. "Certificate" means this Tax Exemption Certificate. "Closing" means the delivery of the Bonds in exchange for the agreed upon purchase price. "Closing Date" means the date of Closing. "Code" means the Internal Revenue Code of 1986, as amended, and any statutes which replace or supplement the Internal Revenue Code of 1986. "Computation Date" means each five-year period from the Closing Date through the last day of the fifth and each succeeding fifth Bond Year. "Excess Earnings" means the amount earned on all Nonpurpose Investments minus the amount which would have been earned if such Nonpurpose Investments were invested at a rate equal to the Bond Yield, plus any income attributable to such excess. "Final Bond Retirement Date" means the date on which the Bonds are actually paid in full. -2- "Governmental Obligations" means direct general obligations of, or obligations the timely payment of the principal of and interest on which is unconditionally guaranteed by the United States. "Gross Proceeds" as defined in Regulation 1.148-1(b), means any Proceeds of the Bonds and any replacement proceeds (as defined in Regulation 1.148-1(c)) of the Bonds. "Gross Proceeds Funds" means the Project Fund and any other fund or account held for the benefit of the owners of the Bonds or containing Gross Proceeds of the Bonds except the Bond Fund and the Rebate Fund. "Issue Price" as defined in Regulation 1.148-1(b), means the initial offering price of the Bonds to the public (not including bond houses, brokers or similar persons or organizations acting in the capacity of underwriters or wholesalers) at which price a substantial amount of the Bonds were sold to the public. The Purchasers have certified the Issue Price to be not more than $ "Issuer" means the City of Iowa City, State of Iowa. "Minor Portion of the Bonds", as defined in Regulation 1.148-2(g), means the lesser of five (5) percent of Proceeds or $100,000. The Minor Portion of the Bonds is computed to be $100,000. "Nonpurpose Investments" means any investment property which is acquired with Gross Proceeds and is not acquired to carry out the governmental purpose of the Bonds, and may include but is not limited to U.S. Treasury bonds, corporate bonds, or certificates of deposit. "Proceeds" as defined in Regulation 1.148-1(b), means Sale Proceeds, investment proceeds and transferred proceeds of the Bonds. "Project" means the the construction, reconstruction, and repairing of improvements to public ways and streets; the construction, improvement, and repair of bridges; the construction of sanitary sewers and storm water sewers and systems; the rehabilitation, improvement and equipping of existing city parks; and the equipping of the fire, police and street departments; targeted area housing rehabilitation improvements; improvements to Fire Station No. 4; and the acquisition of art for public buildings and areas; equipping and remodeling of city buildings, offices and recreation centers; and the acquisition and construction of a transit intermodal facility, as more fully described in the Resolution. -3- "Project Fund" means the fund established in the Resolution. "Purchasers" means Harris Trust and Savings Bank of Chicago, Illinois, constituting the initial purchasers of the Bonds from the Issuer. "Rebate Amount" means the amount computed as described in this Certificate. "Rebate Fund" means the fund to be created, if necessary, pursuant to this Certificate. "Rebate Payment Date" means a date chosen by the Issuer which is not more than 60 days following each Computation Date or the Final Bond Retirement Date. "Regulations" means the Income Tax Regulations, amendments and successor provisions promulgated by the Department of the Treasury under Sections 103, 148 and 149 of the Code, or other Sections of the Code relating to "arbitrage bonds", including without limitation Regulations 1.148-1 through 1.148-11, 1.149(b)-1, 1.149-d(1), 1.150-1 and 1.150-2. "Replacement Proceeds" include, but are not limited to, sinking funds, amounts that are pledged as security for an issue, and amounts that are replaced because of a sufficiently direct nexus to a governmental purpose of an issue. "Resolution" means the resolution of the Issuer adopted on November 19, 2003, authorizing the issuance of the Bonds. "Sale Proceeds" as defined in Regulation 1.148-1(b), means any amounts actually or constructively received from the sale of the Bonds, including amounts used to pay underwriter's discount or compensation and accrued interest other than pre-issuance accrued interest. "Sinking Fund" means the Bond Fund. "SLGS" means demand deposit Treasury securities of the State and Local Government Series. "Tax Exempt Obligations" means bonds or other obligations the interest on which is excludable from the gross income of the owners thereof under Section 103 of the Code and include certain regulated investment companies, stock in tax-exempt mutual funds and demand deposit SLGS. -4- "Taxable Obligations" means all investment property, obligations or securities other than Tax Exempt Obligations. "Verification Certificate" means the certificate attached to this Certificate as Exhibit A, setting forth the offering prices at which the Purchaser will reoffer and sell the Bonds to the public. ARTICLE II SPECIFIC CERTIFICATIONS, REPRESENTATIONS AND AGREEMENTS The Issuer hereby certifies, represents and agrees as follows: Section 2.1 Authorit3, to Certify and Expectations (a) The undersigned officer of the Issuer along with other officers of the Issuer, are charged with the responsibility of issuing the Bonds. (b) This Certificate is being executed and delivered in part for the purposes specified in Section 1.148-2(b)(2) of the Regulations and is intended (among other purposes) to establish reasonable expectations of the Issuer at this time. (c) The Issuer has not been notified of any disqualification or proposed disqualification of it by the Commissioner of the Internal Revenue Service as a bond issuer which may certify bond issues under Section 1.148-2(b)(2) of the Regulations. (d) The certifications, representations and agreements set forth in this Article II are made on the basis of the facts, estimates and circumstances in existence on the date hereof, including the following: (1) with respect to amounts expected to be received from delivery of the Bonds, amounts actually received, (2) with respect to payments of amounts into various funds or accounts, review of the authorizations or directions for such payments made by the Issuer pursuant to the Resolution and this Certificate, (3) with respect to the Issue Price, the certifications of the Purchasers as set forth in the Verification Certificate, (4) with respect to expenditure of the Proceeds of the Bonds, actual expenditures and reasonable expectations of the Issuer as to when the Proceeds will be spent for purposes of the Project, (5) with respect to Bond Yield, review of the Verification Certificate, and (6) with respect to the amount of governmental and Code Section 501 (c)(3) bonds to be issued during the calendar year, the budgeting and present -5- planning of Issuer. The Issuer has no reason to believe such facts, estimates or circumstances are untrue or incomplete in any material way. (e) To the best of the knowledge and belief of the undersigned officer of the Issuer, there are no facts, estimates or circumstances that would materially change the representations, certifications or agreements set forth in this Certificate, and the expectations herein set out are reasonable. (f) No arrangement exists under which the payment of principal or interest on the Bonds would be directly or indirectly guaranteed by the United States or any agency or instrumentality thereof. (g) After the expiration of any applicable temporary periods, and excluding investments in a bona fide debt service fund or reserve fund, not more than five percent (5%) of the Proceeds of the Bonds will be (a) used to make loans which are guaranteed by the United States or any agency or instrumentality thereof, or (b) invested in federally insured deposits or accounts. (h) The Issuer will file with the Internal Revenue Service in a timely fashion Form 8038-G, Information Return for Tax-Exempt Governmental Obligations with respect to the Bonds and such other reports required to comply with the Code and applicable Regulations. (i) The Issuer will take no action which would cause the Bonds to become "private activity bonds" as defined in Section 141 (a) of the Code, including any use of the Project by any person other than a governmental unit if such use will be by other than a member of the general public. None of the Proceeds of the Bonds will be used directly or indirectly to make or finance loans to any person other than a governmental unit. 0) The Issuer will make no change in the nature or purpose of the Project except as provided in Section 6.1 hereof. (k) Except as provided in Section 6.1 hereof, the Issuer will not establish any sinking fund, bond fund, reserve fund, debt service fund or other fund reasonably expected to be used to pay debt service on the Bonds (other than the Bond Fund and any Reserve Fund), exercise its option to redeem Bonds prior to maturity or effect a refunding of the Bonds. (1) No bonds or other obligations of the Issuer (1) were sold in the 15 days preceding the date of sale of the Bonds, (2) were sold or will be sold within the 15 days -6- after the date of sale of the Bonds, (3) have been delivered in the past 15 days or (4) will be delivered in the next 15 days pursuant to a common plan of financing for the issuance of the Bonds and payable out of substantially the same source of revenues. (m) None of the Proceeds of the Bonds will be used directly or indirectly to replace funds of the Issuer used directly or indirectly to acquire obligations having a yield higher than the Bond Yield. (n) No portion of the Bonds is issued for the purpose of investing such portion at a higher yield than the Bond Yield. (o) The Issuer does not expect that the Proceeds of the Bonds will be used in a manner that would cause them to be "arbitrage bonds" as defined in Section 148(a) of the Code. The Issuer does not expect that the Proceeds of the Bonds will be used in a manner that would cause the interest on the Bonds to be includible in the gross income of the owners of the Bonds under the Code. The Issuer will not intentionally use any portion of the Proceeds to acquire higher yielding investments. (p) The Issuer will not use the Proceeds of the Bonds to exploit the difference between tax-exempt and taxable interest rates to obtain a material financial advantage. (q) The Issuer has not issued more Bonds, issued the Bonds earlier, or allowed the Bonds to remain outstanding longer than is reasonably necessary to accomplish the governmental purposes of the Bonds and in fact, the Bonds will not remain outstanding longer than 120% of the economic useful life of the assets financed with the Proceeds of the Bonds. (r) The Bonds will not be Hedge Bonds as described in Section 149(g)(3) of the Code because the Issuer reasonably expects that it will meet the Expenditure Test set forth in Section 2.5(b) hereof and that 50% or more of the Proceeds will not be invested in Nonpurpose Investments having a substantially guaranteed yield for four or more years. (s) The Issuer has not employed a device in connection with the issuance of the Bonds to obtain a material financial advantage (based on arbitrage) apart from savings attributable to lower interest rates. The Issuer will not realize any material financial advantage (based on arbitrage or otherwise) in connection with the issuance of the Bonds, or in connection with any transaction or series of transactions connected with the issuance of the Bonds, apart from savings attributable to lower interest rates. -7- Section 2.2 Receipts and Expenditures of Sale Proceeds Sale Proceeds and pre-issuance accrued interest received at Closing are expected to be deposited and expended as follows: (a) $ representing pre-issuance accrued interest will be deposited into the Bond Fund and will be used to pay a portion of the interest accruing on the Bonds on the first interest payment date; and (b) $ representing costs of issuing the Bonds will be used within six months of the Closing Date to pay the costs of issuance of the Bonds (with any excess remaining on deposit in the Project Fund); and (c) $ will be deposited into the Project Fund and will be used together with earnings thereon to pay the costs of the Project and will not exceed the amount necessary to accomplish the governmental purposes of the Bonds. Section 2.3 Purpose of Bond~ The Issuer is issuing the Bonds to pay the costs of the construction, reconstruction, and repairing of improvements to public ways and streets; the construction, improvement, and repair of bridges; the construction of sanitary sewers and storm water sewers and systems; the rehabilitation, improvement and equipping of existing city parks; and the equipping of the fire, police and street departments; targeted area housing rehabilitation improvements; improvements to Fire Station No. 4; and the acquisition of art for public buildings and areas; equipping and remodeling of city buildings, offices and recreation centers; and the acquisition and construction of a transit intermodal facility. Section 2.4 Facts Supporting Tax-Exemption Classification Governmental Bonds Private Business Use/Private Security or Payment Tests The Bonds are considered to be governmental bonds, not subject to the provisions of the alternate minimum tax. The Proceeds will be used for the purposes described in Section 2.3 hereof. These bonds are not private activity bonds because no amount of Proceeds of the Bonds is to be used in a trade or business carried on by a non-governmental unit. Rather, the Proceeds will be used -8- to finance the general government operations and facilities of the Issuer described in Section 2.3 hereof. None of the payment of principal or interest on the Bonds will be derived from, or secured by, money or property used in a trade or business of a non-governmental unit. In addition, none of the governmental operations or facilities of the Issuer being financed with the Proceeds of the Bonds are subject to any lease, management contract or other similar arrangement or to any arrangement for use other than as by the general public. Private Loan Financing Test No amount of Proceeds of the Bonds is to be used directly or indirectly to make or finance loans to persons other than governmental units. Section 2.5 Facts Supporting Temporary Periods for Proceedn (a) Time Test. Not later than six months after the Closing Date, the Issuer will incur a substantial binding obligation to a third party to expend at least 5% of the net Sale Proceeds of the Bonds. (b) Expenditure Test. Not less than 85% of the net Sale Proceeds will be expended for Project costs, including the reimbursement of other funds expended to date, within a three-year temporary period from the Closing Date. (c) Due Diligence Test. Not later than six months after Closing, work on the Project will have commenced and will proceed with due diligence to completion. (d) Proceeds of the Bonds representing less than six months accrued interest on the Bonds will be spent within six months of this date to pay interest on the Bonds, and will be invested without restriction as to yield for a temporary period not in excess of six months. Section 2.6 Resolution Funds at Restricted or Unrestricted Yield (a) Proceeds of the Bonds will be held and accounted for in the manner provided in the Resolution. The Issuer has not and does not expect to create or establish any other bond fund, reserve fund, or similar fund or account for the Bonds. The Issuer has not and will not pledge any moneys or Taxable Obligations in order to pay debt service on the Bonds or restrict the use of such moneys or Taxable Obligations so as to give reasonable assurances of their availability for such purposes. -9- (b) Any monies which are invested beyond a temporary period are expected to constitute less than a major portion of the Bonds or to be restricted for investment at a yield not greater than one-eighth of one percent above the Bond Yield. (c) The Issuer has established and will use the Bond Fund primarily to achieve a proper matching of revenues and debt service within each Bond Year and the Issuer will apply moneys deposited into the Bond Fund to pay the principal of and interest on the Bonds. Such Fund will be depleted at least once each Bond Year except for a reasonable carryover amount. The carryover amount will not exceed the greater of (1) one year's earnings on the Bond Fund or (2) one-twelfth of Annual Debt Service. The Issuer will spend moneys deposited from time to time into such fund within 13 months after the date of deposit. Revenues, intended to be used to pay debt service on the Bonds, will be deposited into the Bond Fund as set forth in the Resolution. The Issuer will spend interest earned on moneys in such fund not more than 12 months after receipt. Accordingly, the Issuer will treat the Bond Fund as a bona fide debt service fund as def'med in Regulation 1.148-1(b). Investment of mounts on deposit in the Bond Fund will not be subject to arbitrage rebate requirements as the Bonds meet the safe harbor set forth in Regulation 1.148-3(k), because the average annual debt service on the Bonds will not exceed $2,500,000. (d) The Minor Portion of the Bonds will be invested without regard to yield. Section 2.7 Pertaining to Yields (a) The purchase price of all Taxable Obligations to which restrictions apply under this Certificate as to investment yield or rebate of Excess Earnings, if any, has been and shall be calculated using (i) the price taking into account discount, premium and accrued interest, as applicable, actually paid or (ii) the fair market value if less than the price actually paid and if such Taxable Obligations were not purchased directly from the United States Treasury. The Issuer will acquire all such Taxable Obligations directly from the United States Treasury or in an arm's length transaction without regard to any amounts paid to reduce the yield on such Taxable Obligations. The Issuer will not pay or permit the payment of any amounts (other than to the United States) to reduce the yield on any Taxable Obligations. Obligations pledged to the payment of debt service on the Bonds, or deposited into any reserve fund after they have been acquired by the Issuer will be treated as though they were acquired for their fair market value on the date of such pledge or deposit. Obligations on deposit in any reserve fund on the Closing Date shall be treated as if acquired for their fair market value on the Closing Date. -10- (b) Qualified guarantees have not been used in computing yield. (c) The Bond Yield has been computed as not less than percent. This Bond Yield has been computed on the basis of a purchase price for the Bonds equal to the Issue Price. ARTICLE III REBATE Section 3.1 Records Sale Proceeds of the Bonds will be held and accounted for in the manner provided in the Resolution. The Issuer will maintain adequate records for funds created by the Resolution and this Certificate including all deposits, withdrawals, transfers from, transfers to, investments, reinvestments, sales, purchases, redemptions, liquidations and use of money or obligations until six years after the Final Bond Retirement Date. Section 3.2 Rebate Fund (a) In the Resolution, the Issuer has covenanted to pay to the United States the Rebate Amount, an amount equal to the Excess Earnings on the Gross Proceeds Funds, if any, at the times and in the manner required or permitted and subject to stated special rules and allowable exceptions or exemptions. (b) The Issuer may establish a fund pursuant to the Resolution and this Certificate which is herein referred to as the Rebate Fund. The Issuer will invest and expend amounts on deposit in the Rebate Fund in accordance with this Certificate. (c) Moneys in the Rebate Fund shall be held by the Issuer or its designee and, subject to Sections 3.4, 3.5 and 6.1 hereof, shall be held for future payment to the United States as contemplated under the provisions of this Certificate and shall not constitute part of the trust estate held for the benefit of the owners of the Bonds or the Issuer. (d) The Issuer will pay to the United States from legally available money of the Issuer (whether or not such available money is on deposit in any fund or account related to the Bonds) any amount which is required to be paid to the United States. -11- Section 3.3 Exceptions to Rebate The Issuer reasonably expects that the Bonds are eligible for one or more exemptions from the arbitrage rebate roles set forth in the Treasury Regulations. If the bonds are ineligible, or become ineligible, for an exemption to the arbitrage rebate rules, the Issuer will comply with the provisions of Article III hereof. A description of the applicable rebate exemptions is as follows: Eighteen-Month Exemption The Gross Proceeds of the Bonds are expected to be expended for the governmental purposes for which the Bonds were issued in accordance with the following schedule: 1) 15 percent spent within six months of the Closing Date; 2) 60 percent spent within one year of the Closing Date; 3) 100 percent spent within eighteen months of the Closing Date (subject to 5 percent retainage for not more than one year). In any event, the Issuer expects that the 5% reasonable retainage will be spent within 30 months of the Closing Date. For purposes of determining compliance with the six-month and twelve-month spending periods, the amount of investment earnings included shall be based on the Issuer's reasonable expectations that the average annual interest rate on investments will be not more than 3.0%. For purposes of determining compliance with the eighteen-month spending period, the amount of investment earnings included shall be based on actual earnings. If the Issuer fails to meet the foregoing expenditure schedule, the Issuer shall comply with the arbitrage rebate requirements of the Code. · Election to Treat as Construction Bonds. The Bonds qualify as a "construction issue" as defined in Section 148(f)(4)(C)(vi) of the Code. The Issuer reasonably expects that more than 75 percent of the "available construction proceeds" ("ACP") of the Bonds, as defined in Section 148(f)(4)(C)(vi) of the Code, will be used for construction expenditures. ACP includes the issue price of the issue plus the earnings on such issue. Not less than the following percentages of the ACP will be spent within the following periods: 1) 10 percent spent within six months of the Closing Date; 2) 45 percent spent within one year of the Closing Date; 3) 75 percent spent within eighteen months of the Closing Date; -12- 4) 100 percent spent within two years of the Closing Date (subject to 5 pement retainage for not more than one year). In any event, the Issuer expects that the 5% reasonable retainage will be spent within a three-year period beginning on the Closing Date. A failure to spend an amount that does not exceed the lesser of(i) 3% of the issue price or (ii) $250,000, is disregarded if the Issuer exercises due diligence to complete the Project. · Election with respect to future earnings Pursuant to Section 1.148-7(h)(i)(3) of the Regulations, the Issuer shall calculate the amount of future earnings to be used in determining compliance with the first three spending periods based on its reasonable expectations that the average annual interest rate on investments of the ACP will be not more than 3.0%. Compliance with the final spending period shall be calculated using actual earnings. If the Issuer fails to meet the foregoing expenditure schedule, the Issuer shall comply with the arbitrage rebate requirements of the Code. Section 3.4 Calculation of Rebate Amount (a) As soon after each Computation Date as practicable, the Issuer shall, if necessary, calculate and determine the Excess Earnings on the Gross Proceeds Funds (the "Rebate Amount"). All calculations and determinations with respect to the Rebate Amount will be made on the basis of actual facts as of the Computation Date and reasonable expectations as to future events. (b) If the Rebate Amount exceeds the amount currently on deposit in the Rebate Fund, the Issuer may deposit an amount in the Rebate Fund such that the balance in the Rebate Fund after such deposit equals the Rebate Amount. If the amount in the Rebate Fund exceeds the Rebate Amount, the Issuer may withdraw such excess amount provided that such withdrawal can be made from amounts originally transferred to the Rebate Fund and not from earnings thereon, which may not be transferred, and only if such withdrawal may be made without liquidating investments at a loss. Section 3.5 Rebate Requirements and the Bond Fund It is expected that the Bond Fund described in the Resolution and Section 2.7(b) of this Certificate will be treated as a bona fide debt service fund as defined in Regulation 1.148-1(b). As such, any amount earned during a Bond Year on the Bond Fund and -13- amounts earned on such amounts, if allocated to the Bond Fund, will not be taken into account in calculating the Rebate Amount if the annual gross earnings on the Bond Fund for such Bond Year are less than $100,000 or if average annual debt service will not exceed $2,500,000. However, should annual gross earnings exceed $100,000 or should the Bond Fund cease to be treated as a bona fide debt service fund, the Bond Fund will become subject to the rebate requirements set forth in Section 3.4 hereof. Section 3.6 Investment of the Rebate Fund (a) Immediately upon a transfer to the Rebate Fund, the Issuer may invest all amounts in the Rebate Fund not already invested and held in the Rebate Fund, to the extent possible, in (1) SLGS, such investments to be made at a yield of not more than one-eighth of one percent above the Bond Yield, (2) Tax Exempt Obligations, (3) direct obligations of the United States or (4) certificates of deposit of any bank or savings and loan association. All investments in the Rebate Fund shall be made to mature not later than the next Rebate Payment Date. (b) If the Issuer invests in SLGS, the Issuer shall file timely subscription forms for such securities (if required). To the extent possible, amounts received from maturing SLGS shall be reinvested immediately in zero yield SLGS maturing on or before the next Rebate Payment Date. Section 3.7 Payment to the United States (a) On each Rebate Payment Date, the Issuer will pay to the United States at least ninety percent (90%) of the Rebate Amount less a computation credit of $1,000 per Bond Year for which the payment is made. (b) The Issuer will pay to the United States not later than sixty (60) days after the Final Bond Retirement Date all the rebatable arbitrage as of such date and any income attributable to such rebatable arbitrage as described in Regulation 1.148-3(0(2). (c) If necessary, on each Rebate Payment Date, the Issuer will mail a check to the Internal Revenue Service Center, Ogden, UT 84201. Each payment shall be accompanied by a copy of Form 8038-T, Arbitrage Rebate, filed with respect to the Bonds or other information reporting form as is required to comply with the Code and applicable Regulations. -14- Section 3.8 Records (a) The Issuer will keep and retain adequate records with respect to the Bonds, the Gross Proceeds Funds, the Bond Fund, and the Rebate Fund until six years after the Final Bond Retirement Date. Such records shall include descriptions of all calculations of amounts transferred to the Rebate Fund, if any, and descriptions of all calculations of amounts paid to the United States as required by this Certificate. Such records will also show all amounts earned on moneys invested in such funds, and the actual dates and amounts of all principal, interest and redemption premiums (if any) paid on the Bonds. (b) Records relating to the investments in such Funds shall completely describe all transfers, deposits, disbursements and earnings including: (i) a complete list of all investments and reinvestments of amounts in each such Fund including, if applicable, purchase price, purchase date, type of security, accrued interest paid, interest rate, dated date, principal amount, date of maturity, interest payment dates, date of liquidation, receipt upon liquidation, market value of such investment on the Final Bond Retirement Date if held by the Issuer on the Final Bond Retirement Date, and market value of the investment on the date pledged to the payment of the Bonds, or the Closing Date if different from the purchase date. (ii) the amount and source of each payment to, and the amount, purpose and payee of each payment from, each such Fund. Section 3.9 Additional Payments The Issuer hereby agrees to pay to the United States from legally available money of the Issuer (whether or not such available money is on deposit in any fund or account related to the Bonds) any amount which is required to be paid to the United States, but which is not available in a fund related to the Bonds for transfer to the Rebate Fund or payment to the United States. -15- ARTICLE IV INVESTMENT RESTRICTIONS Section4.1 Avoidance of Prohibited Payments The Issuer will not enter into any transaction that reduces the amount required to be deposited into the Rebate Fund or paid to the United States because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm's length and had the Bond Yield not been relevant to either party. The Issuer will not invest or direct the investment of any funds in a manner which reduces an amount required to be paid to the United States because such transaction results in a small profit or larger loss than would have resulted if the transaction had been at arm's length and had the Bond Yield not been relevant to the Issuer. In particular, notwithstanding anything to the contrary contained herein or in the Resolution, the Issuer will not invest or direct the investment of any funds in a manner which would violate any provision of this Article IV. Section 4.2 Market Price Requirement (a) The Issuer will not purchase or direct the purchase of Taxable Obligations for more than the then available market price for such Taxable Obligations. The Issuer will not sell, liquidate or direct the sale or liquidation of Taxable Obligations for less than the then available market price. (b) For purposes of this Certificate, United States Treasury obligations purchased directly from the United States Treasury will be deemed to be purchased at the market price. Section 4.3 Investment in Certificates of Deposit (a) Notwithstanding anything to the contrary contained herein or in the Resolution, the Issuer will invest or direct the investment of funds on deposit in the Reserve Fund, any other Gross Proceeds Fund, the Bond Fund, and the Rebate Fund, in a certificate of deposit of a bank or savings bank which is permitted by law and by the Resolution only if(l) the price at which such certificate of deposit is purchased or sold is the bona fide bid price quoted by a dealer who maintains an active secondary market in certificates of deposit of the same type or (2) if there is no active secondary market in such certificates of deposit, the certificate of deposit must have a yield (A) as high or higher than the yield on comparable obligations traded on an active secondary market, as -16- certified by a dealer who maintains such a market, and (B) as high or higher than the yield available on comparable obligations of the United States Treasury. (b) The certificate of deposit described in part 2(A) of paragraph 4.3(a) above must be executed by a dealer who maintains an active secondary market in comparable certificates of deposit and must be based on actual trades adjusted to reflect the size and term of that certificate of deposit and the stability and reputation of the bank or savings bank issuing the certificate of deposit. Section 4.4 Investment Pursuant to Investment Contracts and Agreements The Issuer will invest or direct the investment of funds on deposit in the Reserve Fund, any other Gross Proceeds Fund, the Bond Fund, and the Rebate Fund pursuant to an investment contract (including a repurchase agreement) only if (A) the Issuer receives at least three bids on the investment contract from persons other than those with an interest in the Bonds (e.g. underwriters, financial advisors), (B) the person whose bid is accepted provides a certification stating that based on that person's reasonable expectations on the date the investment contract is entered into, Taxable Obligations will not be purchased pursuant to the investment contract at a price in excess of their fair market value or sold pursuant to the investment contract at a price less than their fair market value, (C) the yield on the investment contract is at least equal to the yield offered on similar obligations under similar investment contracts (e.g., the yield on investment contracts entered into by issuers of qualified mortgage bonds). Section 4.5 Records The Issuer will maintain records of all purchases, sales, liquidations, investments, reinvestments, redemptions, disbursements, deposits, and transfers of amounts on deposit. Section 4.6 Investments to be Legal All investments required to be made pursuant to this Certificate shall be made to the extent permitted by law. In the event that any such investment is determined to be ultra vires, it shall be liquidated and the proceeds thereof shall be invested in a legal investment, provided that prior to reinvesting such proceeds, the Issuer shall obtain an opinion of Bond Counsel to the effect that such reinvestment will not cause the Bonds to become arbitrage bonds under Sections 103, 148, 149, or any other applicable provision of the Code. -17- ARTICLE V GENERAL COVENANTS The Issuer hereby covenants to perform all acts within its power necessary to ensure that the reasonable expectations set forth in Article II hereof will be realized. The Issuer reasonably expects to comply with all covenants contained in this Certificate. ARTICLE VI AMENDMENTS AND ADDITIONAL AGREEMENTS Section 6.1 Opinion of Bond Counsel; Amendments The various provisions of this Certificate need not be observed and this Certificate may be amended or supplemented at any time by the Issuer if the Issuer receives an opinion or opinions of Bond Counsel that the failure to comply with such provisions will not cause any of the Bonds to become "arbitrage bonds" under the Code and that the terms of such amendment or supplement will not cause any of the Bonds to become "arbitrage bonds" trader the Code, or otherwise cause interest on any of the Bonds to become includable in gross income for federal income tax purposes. Section 6.2 Additional Covenants, Agreements The Issuer hereby covenants to make, execute and enter into (and to take such actions, if any, as may be necessary to enable it to do so) such agreements as may be necessary to comply with any changes in law or regulations in order to preserve the tax- exempt status of the Bonds to the extent that it may lawfully do so. The Issuer further covenants (1) to impose such limitations on the investment or use of moneys or investments related to the Bonds, (2) to make such payments to the United States Treasury, (3) to maintain such records, (4) to perform such calculations, and (5) to perform such other lawful acts as may be necessary to preserve the tax-exempt status of the Bonds. Section 6.3 Amendments Except as otherwise provided in Section 6.1 hereof, all the rights, powers, duties and obligations of the Issuer shall be irrevocable and binding upon the Issuer and shall not be subject to amendment or modification by the Issuer. -18- ARTICLE VII QUALIFIED TAX EXEMPT OBLIGATIONS The Issuer, a "qualified small issuer," designates the Bonds as "qualified tax exempt obligations" as defined in Code Section 265(b)(3) and represents that the reasonably anticipated amount of tax-exempt governmental and Code Section 501 (c)(3) obligations which will be issued during the current calendar year will not exceed ten million dollars ($10,000,000). In support of the foregoing, the Issuer states: (a) In the current calendar year the Issuer has issued governmental or 501(c)(3) bonds as follows: $5,570,000 General Obligation Bonds, Series 2003, covered by this Certificate. (b) The Issuer expects to issue during the remainder of the calendar year, 501 (c)(3) or governmental bonds as follows: NONE. 1N WITNESS WHEREOF, the Issuer has caused this Certificate to be executed by its duly authorized officer, all as of the day first above written. F{nafice Direct~'r ot[the City of I~ City, State of Iowa ~/ (SEAL) MMCG1NLEY~391428\1 \10714.080 -19- 11-25-03 CIG27.TXT (5/9~) CONTINUING DISCLOSURE CERTIFICATE This Continuing Disclosure Certificate (thc "Disclosure Certificate") is executed and dclivcrcd by Iowa City, Iowa (thc "Issuer") in connection with the issuance of $$,570,000 Corporate Purpose General Obligation Bonds, Series 2003 (the "Bonds") dated December 15, 2003. The Bonds arc being issued pursuant to a Resolution of the Issuer approved on November 25 ,2003 (the "Resolution"). The Issuer covenants and agrees as follows: SECTION 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the Issuer for the benefit of the Holders and Beneficial Owners of the Bonds and in order to assist the Participating Under~vritcrs in complying with S.E.C. Rule .15c2-12(b)(5). SECTION 2. Definitions. In addition to the definitions set forth in the Resolution, which apply to any capitalized term used in tiffs Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have thc following meanings: "Annual Report" shall mean any Annual Report provided by the Issuer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. "Beneficial Owner" shall mcan any person which (a) has thc power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for federal income tax purposes. "Dissemination Agent" shall mean any Dissemination Agent designated in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation. "Holders" shall mean the registered holders of the Bonds, as recorded in the registration books of the Registrar. "Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate. "Municipal Securities Rulemaking Board" or "MSRB" shall mean the Municipal Securities Rulemaking Board, 1900 Duke Street, Suite 600, Alexandria, VA 22314. "National Repository" shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. The National Repositories currently approved by the Securities and Exchange Commission are set forth in Exhibit B. "Participating Underwriter" shall mean any of the original underwriters of the Bonds required to comply with the Rule in connection with offering of the Bonds. "Repository" shall mean each National Repository and each State Repository. "Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "State" shall mean the State of Iowa. "State Repository" shall mean any public or private repository or entity designated by the State as a state repository for the purpose of the Rule and recognized as such by the Securities and Exchange Commission. As of the date of this Certificate, there is no State Repository. SECTION 3. Provision of Annual Reports. (a) The Issuer shall, or shall cause the Dissemination Agent to, not later than two hundred-ten (210) days after the end of the Issuer's fiscal year (presently June 30th), commencing with the report for the 2002/2003 fiscal year, provide to each Repository an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross- reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the Issuer may be submitted separately from the balance of the Annual Report and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Issuer's fiscal year changes, it -2- shall give notice of such change in the same manner as for a Listed Event under Section 5(c). (b) Not later than fifteen (15) business days prior to said date, the Issuer shall provide the Annual Report to the Dissemination Agent (if other than the Issuer). If the Issuer is unable to provide to the Repositories an Annual Report by the date required in subsection (a), the Issuer shall send a notice to the Municipal Securities Rulemaking Board and the State Repository, if any, in substantially the form attached as Exhibit A. (c) The Dissemination Agent shall: (i) determine each year prior to the date for providing the Annual Report the name and address of each National Repository and the State Repository, if any, and (ii) (if the Dissemination Agent is other than the Issuer), file a report with the Issuer certifying that the Annual report has been provided pursuant to this Disclosure Certificate, stating the date it was provided and listing all the Repositories to which it was provided. SECTION 4. Content of Annual Reports. The Issuer's Annual Report shall contain or incorporate by reference the following: 1. The audited financial statements of the Issuer for the prior fiscal year, prepared in accordance with generally accepted accounting principles promulgated by the Financial Accounting Standards Board as modified in accordance with the governmental accounting standards promulgated by the Governmental Accounting Standards Board or as othemSse provided under State law, as in effect from time to time, or, if and to the extent sUch financial statements have not been prepared in accordance with generally accepted accounting principles, noting the discrepancies therefrom and the effect thereof. If the Issuer's audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. -3- 2. Information of the type contained in the final Official Statement under the captions: "General Obligation Debt Annual Maturity Schedule" "Revenue Debt" "Debt Limit Computation" "Overlapping Debt" "Statements of Revenues and Expenditures for the General Fund" "General Fund Budget" "Cash and Investments" "Property Valuations and Taxes" "Actual Value by Class" "Tax Collections" "Tax Rates" "Principal Taxpayers" Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the Issuer or related public entities, which have been submitted to each of the Repositories or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the Municipal Securities Rulemaldng Board. The Issuer shall clearly identify each such other document so included by reference. SECTION 5. Reporting of Significant Events. (a) Pursuant to the provisions of this Section 5, the Issuer shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds, if material: (1) principal and interest payment delinquencies; (2) non-payment related defaults; (3) unscheduled draws on debt service reserves reflecting financial difficulties; (4) tmscheduled draws on credit enhancements reflecting financial difficulties; -4- (5) substitution of credit or liquidity providers, or their failure to perform; (6) adverse tax opinions or events affecting the tax- exempt status of the security; (7) modifications to rights of security holders; (8) bond calls; (9) defeasances; (10) release, substitution, or sale of property securing repayment of the securities; and (11) rating changes. (b) Whenever the Issuer obtains the knowledge of the occurrence of a Listed Event, the Issuer shall as soon as possible determine if such event would be material under applicable federal securities laws. (c) If the Issuer determines that knowledge of the occurrence of a Listed Event would be material under applicable federal securities laws, the Issuer shall promptly file a notice of such occurrence with the Municipal Securities Rulemaking Board and the State Repository. Notwithstanding the foregoing, notice of Listed Events described in subsections (a) (8) and (9) need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to Holders of affected Bonds pursuant to the Resolution. SECTION 6. Termination of Reporting Obligation. The Issuer's obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds or upon the Issuer's receipt of an opinion of nationally recognized bond counsel to the effect that, because of legislative action or final judicial action or administrative actions or proceedings, the failure of the Issuer to comply with the terms hereof will not cause Participating Underwriters to be in violation of the Rule or other applicable requirements of the Securities Exchange Act of 1934, as amended. If -5- such termination occurs prior to the final maturity of the Bonds, the Issuer shall give notice of such termination in the same manner as for a Listed Event under Section 5(c). SECTION 7. Dissemination Agent. The Issuer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by the Issuer pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be the Issuer. SECTION 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied: (a) If the amendment or waiver relates to the provisions of Section 3(a), 4, or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of an obligated person with respect to the Bonds, or the type of business conducted; (b) The undertaking, as amended or taking into account such waiver, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) The amendment or waiver either (i) is approved by the Holders of the Bonds in the same manner as provided in the Resolution for amendments to the Resolution with the consent of Holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the Bonds. In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Issuer shall describe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the -6- presentation) of financial information or operating data being presented by the Issuer. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5(c), and (ii) the Annual Report for the year in which the change is made will present a comparison or other discussion in narrative form (and also, if feasible, in quantitative form) describing or illustrating the material differences between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. SECTION 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Issuer chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have no obligation under this Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event. SECTION 10. Default. In the event of a failure of the Issuer to comply with any provision of this Disclosure Certificate, any Holder or Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Issuer to comply with its obligations under this Disclosure Certificate. Direct, indirect, consequential and punitive damages shall not be recoverable by any person for any default hereunder and are hereby waived to the extent permitted by law. A default under this Disclosure Certificate shall not be deemed an event of default under the Resolution, and the sole remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with this Disclosure Certificate shall be an action to compel performance. SECTION 11. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Issuer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The obligations of the Issuer -7- under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. SECTION 12. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the Dissemination Agent, the Participating Underwriters and Holders and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity. IOWA CITY, IOWA Mayor ATTEST: City'Clerk -8- EXHIBIT A NOTICE TO REPOSITORIER OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: Iowa City, Iowa Name of Bond Issue: $5,570,000 Corporate Purpose General Obligation Bonds, Series 2003 Dated Date of Issue: December 15, 2003 NOTICE IS HEREBY GIVEN that the Issuer has not provided an Annual Report with respect to the above-named Bonds as required by Section 3 of the Continuing Disclosure Certificate delivered by the Issuer in connection with said Bonds. The Issuer anticipates that the Annual Report will be filed by Dated: IOWA CITY, IOWA By: Mayor ATTEST: By: City Clerk EXHIBIT B Nationally Recognized Municipal Securities Information Repositories currently approved by the Securities and Exchange Comnfission: Bloomberg Municipal Repository 100 Business Park Drive Skillman, New Jersey 08558 Phone: (609) 279-3225 Fax: (609) 279-5962 http://www.bloomberg.com/markets/municipal-contactinfo.html DPC Data Inc. One Executive Drive Fort Lee, NJ 07024 Phone: (201) 346-0701 Fax: (201) 947-0107 http://www.dpcdata.com Standard & Poor's Securities Evaluations, Inc. 55 Water Street, 45th Floor New York, NY 10041 Phone: (212) 438-4595 FAX: (212) 438-3975 www.jjkenny, com/jjkenny/pser descrip data rep.html FT Interactive Data Attn: NRMSIR 100 William Street New York, NY 10038 Phone: (212) 771-6999 FAX: (212) 771-7390 (Secondary Market Information) (212) 771-7391 (Primary Market Information) http://www.interactivedata.eom 388553/10713080 ATTENTiON~! YOUTH TOWN )11~!~ 1 IN(, SPONSORED BY THE IOWA CITY HUMAN RIGHTS COHHISNION UNITED ACTION FOR YOUTH (UAY) WEI)NESI)AY I)F.C. 1 ()~ ~°~,~ 7-9 PM 28 S. LINN THE CENTER - SENIOR CENTER ASSEMBLY ROOM TI~ENAGERS, PANEIJSTS, MEMBERS OF THE COMMUNITY ! I}ISCUSSING HARASSHE~~'& INTIMIDATION CO'SPONSORED BY THE CENTER