HomeMy WebLinkAboutA015 - Letter to Dorsey & Whitney dated October 12, 2004 - Final Delivery Certificate, IRS 8038Caring People 'I
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October 12, 2004
Dorsey & Whitney LLP
801 Grand, Suite 3900
Des Moines, Iowa 50309
Attention Robert E. Josten
City Clerk's Office
515 Clark Avenue, P. 0. Box 811
Ashes, IA 50010
Phone: 515-239-5105
Fax: 515-239-5142
RE: Ames, Iowa
$6,030,000 General Obligation Corporate Purpose Bonds, Series 2004
Your File No. 419370-29
Dear Bob:
Enclosed please find two fully executed copies of the Final Delivery Certificate and a signed IRS
8038 -form pertaining to the above -named Corporate Purpose Bonds.
Thank you for your assistance.
Sincerely,
Diane R. Voss
City Clerk
/dry
Enclosures
Ames/419370-32/FDC & Ltr
FO n- YOUR REC(114,,..,�, 419370-32 FDC - G.O.
We, the undersigned Mayor, City Clerk and City Treasurer, of the City of Ames, in Story
County, Iowa (the "City"), do hereby certify that we are now and were at the time of the
execution of the City's $6,030,000 General Obligation Corporate Purpose Bonds, Series 2004,
dated October 15, 2004 (the "Bonds"), the officers respectively above indicated; and that in
pursuance of Chapter 384 of the Code of Iowa and a resolution adopted by the City Council on
September 28, 2004 (the "Resolution"), the Bonds have been heretofore lawfully authorized and
this day by us lawfully sold, issued and delivered to the original purchaser thereof (the
"Purchaser"), and paid for at a price of $6,070,397.28, receipt of which is hereby acknowledged,
which amount represents the purchase price of the Bonds ($6,068,376.45), plus accrued interest
thereon ($2,020.83). The Bonds mature on June I in each of the years, in the respective
principal amounts and bear interest payable semiannually, commencing June 1, 2005, at the
respective rates, as follows:
Principal
Interest Rate
Principal
Interest Rate
Year
Amount
Per Annum
Year
Amount
Per Annum
2005
$600,000
2.750%
2010
$595,000
3.250%
2006
$535,000
2.750%
2011
$620,000
3.250%
2007
$545,000
2.750%
2012
$640,000
3.250%
2008
$560,000
2.750%
2013
$665,000
3.250%
2009
$580,000
2.750%
2014
$690,000
3.250%
Each of the Bonds has been executed with the facsimile signatures of the aforesaid Mayor
and City Clerk, with a facsimile of the official seal of the City imprinted thereon; and the Bonds
have been fully authenticated by the aforesaid City Treasurer as Bond Registrar and Paying
Agent and registered as to principal and interest in the names of the owners on the registration
books of the City.
We further certify that the Bonds are being issued for the purpose of paying the cost, to
that extent, of constructing various street and storm sewer improvements; bridge rehabilitation;
acquiring equipment for the fire department; and carrying out the City's Ada Hayden Heritage
Park project as part of its Parks and Recreation Project (collectively, the "Projects").
We further certify that no controversy or litigation is pending, prayed or threatened
involving the incorporation, organization, existence or boundaries of the City, or the titles of the
aforesaid officers to their respective positions, or the validity of the Bonds, or the power and duty
of the City to provide and apply adequate taxes for the full and prompt payment of the principal
of and interest on the Bonds, and that none of the proceedings incident to the authorization and
issuance of the Bonds has been repealed or rescinded.
We further certify that no appeal of the decision of the City Council to issue the Bonds
has been taken to the district court.
-I-
DORSEY & WHITNEY LLP, ATTORNEYS, DES MOINES, IOWA
Ames/419370-32/FDC & Ltr
We further certify that all meetings held in connection with the Bonds were open to the
public at a place reasonably accessible to the public and that notice was given at least 24 hours
prior to the commencement of all meetings by advising the news media who requested notice of
the time, date, place and the tentative agenda and by posting such notice and agenda at the City
Hall or principal office of the City on a bulletin board or other prominent place which is easily
accessible to the public and is the place designated for the purpose of posting notices of
meetings.
We further certify as follows:
1. The total costs of the Projects (the "Total Project Costs") are estimated to be at
least $6,030,000.
2. The net sales proceeds of the Bonds are $6,090,192.65 (the "Net Sales
Proceeds"), the same being the Issue Price thereof.
3. The Net Sales Proceeds, including investment earnings thereon, will be invested
by the City without restriction as to yield for a period not to exceed three years from the date
hereof (the "Three Year Temporary Period"), the following three tests being reasonably expected
to be satisfied by the City:
a. Time Test: The City has entered or, within six months of the date
hereof, will enter into binding contracts for the Projects with third parties (e.g.
engineers or contractors);
i. which are not subject to contingencies directly or
indirectly within the City's control;
ii. which provide for the payment by the City to such
third parties of an amount equal to at least 5% of the Net Sales
Proceeds;
b. Expenditure Test: At least 85% of Net Sales Proceeds will be applied
to the payment of Total Project Costs within the Three Year Temporary Period;
and
c. Due Diligence Test: Acquisition and construction of the Projects to
completion and application of the Net Sales Proceeds to the payment of Total
Project Costs will proceed with due diligence.
4. (i) at least 75% of the Net Sales Proceeds (along with any investment earnings
thereon), will be spent on the construction of the Projects (not including the costs of acquisition
of equipment or other personal property), and the City will be the owner of the Projects; and (ii)
the City expects to spend the Net Sales Proceeds (along with any investment earnings thereon) in
accordance with the following schedule: at least 10% within six months; at least 45 % within one
year; at least 75% within 18 months; and 100% within two years. The City acknowledges that if
it fails to spend the Net Sales Proceeds (along with the investment earnings thereon) in
accordance with the foregoing schedule, the City may have a rebate liability to the United States
-2-
DORSEY & WHITNEY LLP, ATTORNEYS, DES MOINES, IOWA
Ames/419370-32/FDC & Ur
pursuant to Section 148 of the Internal Revenue Code of 1986, as amended (the "Internal
Revenue Code")).
5. The Bonds are payable from ad valorem taxes levied against all taxable property
within the City which will be collected in a Debt Service Fund and applied to the payment of
interest on the Bonds on each June 1 and December 1 and principal of the Bonds on each June 1
(the 12-month period ending on each June I being herein referred to as a "Bond Year"); the Debt
Service Fund is used primarily to achieve a proper matching of taxes with principal and interest
payments within each Bond Year; the Debt Service Fund will be depleted at least once each
Bond Year except for a reasonable carryover amount not to exceed the greater of (i) the earnings
on the fund for the immediately preceding Bond Year; or (ii) 1/12 of the principal and interest
payments on the Bonds for the immediately preceding Bond Year; amounts on deposit in the
Debt Service Fund will be invested by the City without restriction as to yield for a period of 13
months after their date of deposit.
6. The City Council has adopted resolutions declaring its official intent to acquire
and construct the Projects and finance the same with the Bonds (the "Intent Resolutions"); none
of the Total Project Costs to be paid for from the Net Sales Proceeds are for expenditures made
for a Project more than 60 days prior to the date of adoption of the Intent Resolution with respect
to that Project, except for (i) costs of issuance of the Bonds; (ii) costs aggregating an amount not
in excess of the lesser of $100,000 or 5% of the Net Sales Proceeds; (iii) costs for preliminary
expenditures (including architectural, engineering, surveying, soil testing, and similar costs
incurred prior to commencement of acquisition or construction of the Projects, other than land
acquisition, site preparation and similar costs) not in excess of 20% of the Issue Price of the
Bonds; the City will allocate Net Sales Proceeds to reimbursement of such expenditures no later
than 18 months after the later of (i) the date any such expenditure was originally paid or (ii) the
date the Project is placed in service, but in no event more than 3 years after such expenditure was
originally paid; and such allocations will be made by the City in writing.
7. Not more than 50% of the Net Sales Proceeds will be invested in nonpurpose
investments (as defined in Section 148(f)(6)(A) of the Internal Revenue Code) having a
substantially guaranteed yield for four years or more (e.g., a four-year guaranteed investment
contract or a Treasury Obligation that does not mature for four years).
8. The weighted average maturity of the Bonds does not exceed the reasonably
expected economic life of the Projects.
9. The amount received as accrued interest will be set aside and deposited into the
City's Debt Service Fund as provided in the Resolution and used to pay interest on the Bonds
due on the first interest payment date.
10. To our best knowledge and belief, there are no facts, estimates or circumstances
which would materially change the foregoing conclusions.
On the basis of the foregoing, it is not expected that the Net Sales Proceeds will be used
in a manner that would cause the Bonds to be "arbitrage bonds" under Section 148 of the Code
and the regulations prescribed under that section. The City has not been notified of any listing or
-3-
DORSEY & WHITNEY LLP, ATTORNEYS, DES MOINES, IOWA
Ames/419370-32/FDC & Ur
proposed listing of it by the Internal Revenue Service as a bond issuer whose arbitrage
certifications may not be relied upon.
The Bonds were sold to the Purchaser at public sale at a purchase price of $6,068,376.45.
The City has been advised by its financial advisor that such price is fair and reasonable under
customary standards applicable to the market. The Purchaser has informed the City that the
initial offering price of the Bonds to the public was $6,090,192.65, resulting in an original issue
premium of $60,192.65 and an underwriter's discount of $21,816.20.
We further certify that due provision has been made for the collection of taxes sufficient
to pay the principal of and interest on the Bonds when due, commencing with the levy of taxes
for collection in the fiscal year which began July 1, 2005 (provisions having been previously
made, and funds being on hand and pledged to pay the interest on and principal of the Bonds
coming due on June 1, 2005).
IN WITNESS WHEREOF, we have hereunto affixed our hands and the seal of the
aforementioned City, as of October 19, 2004.
(Seal)
CITY OF IOWA
Mayor
City Clerk
City ensurer
4-
DORSEY & WHITNEY LLP, ATTORNEYS, DES MOINES, IOWA
to
Form 8038-G Information Return for Tax -Exempt Governmental Obligations
(Rev. November 2000) Do -Under Internal Revenue Code section 149(e) OMB No. 1545-0720
10- See separate Instructions.
Department of the Treasury
Internal Revenue Service Caution: If the issue price is under $100,000, use Form 8038-GC.
Mull ReDonina Authoritv If Amended Return, check here ► El
1
Issuer's name
2 Issuer's employer identification number
City of Ames, Iowa
42: 6004218
3
Number and street (or P.O. box if mail is not delivered to street address)
Room/suite
4 Report number
515 Clark Avenue
2004-1
5
City, town, or post office, state, and ZIP code
6 Date of issue
Ames, Iowa 50010
10119/04
7
Name of issue
8 CUSIP number
General Obligation Corporate Purpose Bonds, Series 2004
030807
9
Name and title of officer or legal representative whom the IRS may call for more information
ve
10 Telephone number of officer or legal representative
Dorsey & Whitney LLP, Des Moines, Iowa Bond Counsel
515 ) 283-1000
11glM iype of issue (cnecK applicable box es and enter the issue price) See instructions and attacn scneauie
11 0 Education . . . . . . . . . . . . . . . . . . . . . . . . . .
12 El Health and hospital . . . . . . . . . . . . . . . . . . .
EJ 13 ❑ Transportation . . . . . . . . . . . . . . . . . . . .
14 0 Public safety . . . . . . . . . . . . . . . . . . . . .
15 0 Environment (including sewage bonds) . . . . . . . . . . . . . . . . .
16 0 Housing . . . . . .
17 El Utilities . . . . . . . . . . . . . . . . . . . .
18 2 Other. Describe I,- street; storm sewer e; fire equipment; parks and recreation
-
19 If obligations are TANs or RANs, check box ► obligations are BANs, check box 0❑
-
20 If obligations are in the form of a lease or inst illm , check box . . . . . . 0❑
11
12
13
14
15
16
17
18
1 6090,193
IMMI! np-,rrintinn of nhiinatininic (7nmnIckto fAM" Pntirp i-zci ip fnr vAihirh thicz farm is hPinn filpri.
(a) Final maturity date
(b) Issue price
e edempbon
i aturity
(d) Weighted
average maturity
(e) Yield
21 06/01114
$ 6,090,193
$ "<�jfflo,000
5.30 . years
2.919978 %
Uses of Proceeds of Bond issue (including underwrnvsj),qiscount)
22
23
Proceeds used for accrued interest . . . . . . . . . . . .
Issue price of entire issue (enter amount from line 21, column (b)) . . . .
22
2,021
23
6,090,193
24 Proceeds used for bond issuance costs (including underwriters' discount) . 1 24
56,81* 6
25
Proceeds used for credit enhancement . . . . . . . . . . . . . 25
26
Proceeds allocated to reasonably required reserve or replacement fund . . 26
27
Proceeds used to currently refund prior issues . . . . . . . . . 27
28
29
Proceeds used to advance refund prior issues . . . . . . . . . 1 28
Total (add lines 24 through 28) . . . . . . . . . . . . . . . . . . . . .
29
56,816_
30
6,033,377
30 Nonrefunding roceeds of the issue (subtract line 29 from line 23 and enter amount here),
991M
Description of Refunded Bonds (Complete this part only for refunding
bonds.)
31
Enter the remaining weighted average maturity of the bonds to be currently refunded .
. . No- years
32
Enter the remaining weighted average maturity of the bonds to be advance refunded .
. . Do- years
33
Enter the last date on which the refunded bonds will be called . . . . . . . . .
. . 10.
34
Enter the dates ) the refunded bonds were issued ►
MW
Miscellaneous
35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) 35
36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (see instructions) 36a
b Enter the final maturity date of the guaranteed investment contract 0- WE
37 Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units 37a
b If this issue is a loan made from the proceeds of another tax-exempt issue, check box ► M and enter the name of the
issuer No- and the date of the issue 00-
38 If the issuer has designated the issue under section 265(b)(3)(B)(i)(111) (small issuer exception), check box . . . 11"o
39 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . . . . . . . . . . 0$- EJ
40 If the issuer has identified a hedge, check box . . . . . . . . . . . . . . . . . . . . . . . 10' E1_
Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge
and belief, they are true, correct, and complete.
Sign
Here
10/19/04
Diane R. Voss, City Clerk
`Type or print name and title
Cat. No. 63773E Form 8038-G (Rev. 11-2000)
issuer's authorized representative
Date
For Paperwork Reduction Act Notice, see page 2 of the Instructions
CDORSE"Y
October 8, 2004
Diane R. Voss
City Clerk
City Hall
515 Clark Avenue
Ames, Iowa 50010
RE: Ames, Iowa
$6,030,000 General Obligation Corporate Purpose Bonds, Series 2004
Our File No.: 419370-32
Dear Diane:
We have prepared and enclose three copies of the Final Delivery Certificate for the Corporate Purpose
Bonds scheduled for closing on October 19.
Please take the following actions with respect to this certificate:
1. Review the facts contained in the certificate and advise us of any inaccuracies, particularly if you
anticipate any problem in spending the proceeds of the Bonds within the time limits outlined.
2. Have this certificate signed and sealed as indicated and return two fully executed copies to our
office as soon as possible.
Please sign the enclosed IRS 8038 form and return it to us so that we can file it with the Internal Revenue
Service in order to preserve the tax exempt status of the interest earnings on the Bonds, The extra copy enclosed is
for the your records.
Finally, we are enclosing the printed Bonds, numbered from I to 10, inclusive, which must be authenticated
(signed) by Sheri Meier as Registrar and sent to The Depository Trust Company no later than Friday, October 15.
We have prepared and enclose a pre -addressed Federal Express package and a cover letter addressed to DTC for
Sheri to sign and send with the Bonds.
If
you have any questions, please call
in-
REJ
Ames/419370-32/FDC & Lft
Enclosures
cc: Steven Schainker
Duane Pitcher
John Klaus
Heather Casperson
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