HomeMy WebLinkAbout2018-159 (providing for competitive negotiated sale of $5,935,000 GO Capital Outlay Bonds, Series 2018A) EXTRACT OF MINUTES OF A MEETING
OF THE CITY COUNCIL
CITY OF STILLWATER, MINNESOTA
HELD: July 17, 2018
Pursuant to due call and notice thereof, a regular or special meeting of the City Council
of the City of Stillwater, Washington County, Minnesota, was duly held at the City Hall on
July 17, 2018, at 7:00 P.M. for the purpose in part of authorizing the competitive negotiated sale
of the $5,935,000 General Obligation Capital Outlay Bonds, Series 2018A.
The following members were present: Councilmembers Polehna, Weidner, Junker,
Menikheim and Mayor Kozlowski
and the following were absent: None
Member Junker introduced the following resolution and moved its adoption:
RESOLUTION NO.2018-159
RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED SALE OF
$5,935,000 GENERAL OBLIGATION CAPITAL OUTLAY BONDS, SERIES 2018A
A. WHEREAS,the City Council of the City of Stillwater,Minnesota(the "City"),
has heretofore determined that it is necessary and expedient to issue $5,935,000 General
Obligation Capital Outlay Bonds, Series 2018A(the "Bonds")to finance (i) renovations of the
police station; (ii)renovation and remodeling of the City Hall; (iii)the 2018 capital outlay needs
of various City departments; (iv) street improvement projects; and(iv) an addition to the St.
Croix Valley Recreational Center, pursuant to Minnesota Statutes, Chapter 475 and Sections
10.4, 10.5 and 10.6 of the City Charter, as more fully described in Exhibit B attached hereto; and
B. WHEREAS,the City has retained Springsted Incorporated, in Saint Paul,
Minnesota("Springsted"), as its independent municipal advisor and is therefore authorized to sell
these obligations by a competitive negotiated sale in accordance with Minnesota Statutes,
Section 475.60, Subdivision 2(9); and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Stillwater,
Minnesota, as follows:
1. Authorization. The City Council hereby authorizes Springsted to solicit proposals
for the competitive negotiated sale of the Bonds.
2. Meeting; Proposal Opening. This City Council shall meet at the time and place
specified in the Terms of Proposal attached hereto as Exhibit A for the purpose of considering
sealed proposals for, and awarding the sale of, the Bonds. The City Clerk or designee, shall open
proposals at the time and place specified in such Terms of Proposal.
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3. Terms of Proposal. The terms and conditions of the Bonds and the negotiation
thereof are fully set forth in the "Terms of Proposal" attached hereto as Exhibit A and hereby
approved and made a part hereof.
4. Official Statement. In connection with the sale,the City Clerk and other officers
or employees of the City are hereby authorized to cooperate with Springsted and participate in
the preparation of an official statement for the Bonds, and to execute and deliver it on behalf of
the City upon its completion.
The motion for the adoption of the foregoing resolution was duly seconded by member
Weidner and, after full discussion thereof and upon a vote being taken thereon,the following
voted in favor thereof: Councilmembers Polehna, Weidner, Junker, Menikheim and Mayor
Kozlowski
and the following voted against the same: None
Whereupon the resolution was declared duly passed and adopted.
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STATE OF MINNESOTA
COUNTY OF WASHINGTON
CITY OF STILLWATER
I, the undersigned, being the duly qualified and City Clerk of the City of Stillwater,
Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of
minutes with the original thereof on file in my office, and that the same is a full,true and
complete transcript of the minutes of a meeting of the City Council duly called and held on
the date therein indicated, insofar as such minutes relate to the City's $5,935,000 General
Obligation Capital Outlay Bonds, Series 2018A.
WITNESS my hand on July 18, 2018. h ,
.0/2/ (3.. 4„) , ...
Diane F. Ward, City Clerk
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EXHIBIT A
Terms of Proposal
THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS
ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS:
TERMS OF PROPOSAL
$5,935,000*
CITY OF STILL WATER.MINNESOTA
GENERAL OBLIGATION CAPITAL OUTLAY BONDS,SERIES 20I8A
(BOOK ENTRY ONLY)
Proposals for the above-referenced obligations(the"Bonds")will be received by the City of Stillwater,
Minnesota(the"City")on Tuesday,August 21,2018(the"Sale Date")until 10:30 A.M.,Central Time at
the offices of Springsted Incorporated("Springsted"),380 Jackson Street,Suite 300,Saint Paul,Minnesota,
55101,after which time proposals will be opened and tabulated. Consideration for award of the Bonds will
be by the City Council at its meeting commencing at 7:00 P.M.,Central Time,of the same day.
SUBMISSION OF PROPOSALS
Springsted will assume no liability for the inability of a bidder to reach Springsted prior to the time of sale
specified above. All bidders are advised that each proposal shall be deemed to constitute a contract between
the bidder and the City to purchase the Bonds regardless of the manner in which the proposal is submitted.
(a) Sealed Biddin2. Proposals may be submitted in a sealed envelope or by fax (651)223-3046 to
Springsted. Signed proposals,without final price or coupons,may be submitted to Springsted prior to the
time of sale. The bidder shall be responsible for submitting to Springsted the final proposal price and
coupons,by telephone(651)223-3000 or fax(651)223-3046 for inclusion in the submitted proposal.
OR
(b) Electronic Biddin2. Notice is hereby given that electronic proposals will be received via PARITY®.
For purposes of the electronic bidding process, the time as maintained by PARITY®shall constitute the
official time with respect to all proposals submitted to PARITY'. Each bidder shall be solely responsible
for making necessary arrangements to access PARiTY®for purposes of submitting its electronic proposal
in a timely manner and in compliance with the requirements of the Terms of Proposal. Neither the City,
its agents, nor PARITY® shall have any duty or obligation to undertake registration to bid for any
prospective bidder or to provide or ensure electronic access to any qualified prospective bidder,and neither
the City,its agents,nor PARITY®shall be responsible for a bidder's failure to register to bid or for any
failure in the proper operation of,or have any liability for any delays or interruptions of or any damages
caused by the services of PARITY®. The City is using the services of PARITY®solely as a communication
mechanism to conduct the electronic bidding for the Bonds,and PARITY®is not an agent of the City.
If any provisions of this Terms of Proposal conflict with information provided by PARITY® this'Terms of
Proposal shall control. Further information about PARITY®,including any fee charged,may be obtained
from:
PARITY®,1359 Broadway,2"Floor,New York,New York 10018
Customer Support: (212)849-5000
* Preliminary;subject to change.
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DETAILS OF THE BONDS
The Bonds will be dated as of the date of delivery and will bear interest payable on February 1 and August 1
of each year,commencing February 1,2019. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
The Bonds will mature February 1 in the years and amounts*as follows:
2019 $395,000 2024 $485,000 2029 $170,000 2034 $125,000 2037 $140,000
2020 $460,000 2025 $490.000 2030 $175,000 2035 $130,000 2038 $145,000
2021 $470,000 2026 $510,000 2031 $180,000 2036 $135,000 2039 $150,000
2022 $475,000 2027 $215,000 2032 $185,000
2023 $490,000 2028 $215,000 2033 $195,000
* The City reserves the right, after proposals are opened and prior to award to increase or reduce the principal
amount of the Bonds or the amount of any maturity or maturities'in multiples of$5,000. In the event the amount
of any maturity is modified the aggregate purchase price will be adjusted to result in the same gross spread per
$1,000 of Bonds as that of the original proposal Gross spread for this purpose is the differential between the
price paid to the City for the new issue and the prices at which the proposal indicates the securities will be initially
offered to the investing public.
Proposals for the Bonds may contain a maturity schedule providing for a combination of serial bonds and
term bonds. All term bonds shall be subject to mandatory sinking fund redemption at a price of par plus
accrued interest to the date of redemption scheduled to conform to the maturity schedule set forth above.
In order to designate term bonds, the proposal must specify "Years of Term Maturities" in the spaces
provided on the proposal form.
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to
the public. The Bonds will be issued in fully registered form and one Bond, representing the aggregate
principal amount of the Bonds maturing in each year, will be registered in the name of Cede &Co. as
nominee of The Depository Trust Company("DTC"), New York,New York,which will act as securities
depository for the Bonds. Individual purchases of the Bonds may be made in the principal amount of$5,000
or any multiple thereof of a single maturity through book entries made on the books and records of DTC
and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered
owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the
responsibility of DTC;transfer of principal and interest payments to beneficial owners by participants will
be the responsibility of such participants and other nominees of beneficial owners. The lowest bidder(the
"Purchaser"),as a condition of delivery of the Bonds,will be required to deposit the Bonds with DTC.
REGISTRAR
The City will name the registrar which shall be subject to applicable regulations of the Securities and
Exchange Commission. The City will pay for the services of the registrar.
OPTIONAL REDEMPTION
The City may elect on February 1, 2027, and on any day thereafter, to redeem Bonds due on or after
February 1, 2028. Redemption may be in whole or in part and if in part at the option of the City and in
such manner as the City shall determine. If less than all Bonds of a maturity are called for redemption,the
City will notify DTC of the particular amount of such maturity to be redeemed. DTC will determine by lot
the amount of each participant's interest in such maturity to be redeemed and each participant will then
select by lot the beneficial ownership interests in such maturity to be redeemed. All redemptions shall be
at a price of par plus accrued interest.
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SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and credit and
power to levy direct general ad valorem taxes. The proceeds of the Bonds will be used to finance
(i) renovations of the Police station;(u)renovation and remodeling of the City Hall;(iii)the 2018 Capital
Outlay needs of various City departments; (iv) street improvement projects; and (v) an addition to the
St. Croix Valley Recreational Center.
BIDDING PARAMETERS
Proposals shall be for not less than S5,872,683 plus accrued interest,if any,on the total principal amount
of the Bonds. No proposal can be withdrawn or amended after the time set for receiving proposals on the
Sale Date unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed, or
continued to another date without award of the Bonds having been made. Rates shall be in integral multiples
of 1(100 or 1/8 of 1%. The initial price to thepublic for each maturity as stated on the proposal must be
98.0%or greater.Bonds of the same maturity shall bear a single rate from the date of the Bonds to the date
of maturity. No conditional proposals will be accepted.
ESTABLISHMENT OF ISSUE PRICE
In order to provide the City with information necessary for compliance with Section 148 of the Internal
Revenue Code of 1986,as amended, and the Treasury Regulations promulgated thereunder(collectively,
the"Code"),the Purchaser will be required to assist the City in establishing the issue price of the Bonds
and shall complete,execute,and deliver to the City prior to the closing date,a written certification in a form
acceptable to the Purchaser, the City, and Bond Counsel (the "Issue Price Certificate") containing the
following for each maturity of the Bonds(and,if different interest rates apply within a maturity,to each
separate CUSIP number within that maturity):: (i) the interest rate; (ii) the reasonably expected initial
offering price to the `public" (as said term is defined in Treasury Regulation Section 1_148-1(f) (the
"Regulation")) or the sale price; and (iii) pricing wires or equivalent communications supporting such
offering or sale price. Any action to be taken or documentation to be received by the City pursuant hereto
may be taken or received on behalf of the City by Springsted.
The City intends that the sale of the Bonds pursuant to this Terms of Proposal shall constitute a"competitive
sale"as defined in the Regulation based on the following:
(i) the City shall cause this Terms of Proposal to be disseminated to potential bidders in a
manner that is reasonably designed to reach potential bidders;
(ii) all bidders shall have an equal opportunity to submit a bid:
(iii) the City reasonably expects that it will receive bids from at least three bidders that have
established industry reputations for underwriting municipal bonds such as the Bonds;and
(iv) the City anticipates awarding the sale of the Bonds to the bidder who provides a proposal
with the lowest true interest cost;as set forth in this Terms of Proposal(See"AWARD
herein).
Any bid submitted pursuant to this Terms of Proposal shall be considered a firm offer for the purchase of
the Bonds, as specified in the proposal. The Purchaser shall constitute an"underwriter" as said term is
defined in the Regulation. By submitting its proposal, the Purchaser confirms that it shall require any
agreement among underwriters;a selling group agreement,or other agreement to which it is a party relating
to the initial sale of the Bonds,to include provisions requiring compliance with the provisions of the Code
and the Regulation regarding the initial sale of the Bonds.
If all of the requirements of a"competitive sale" are not satisfied,the City shall advise the Purchaser of
such fact prior to the time of award of the sale of the Bonds to the Purchaser. In such event,any proposal
submitted will not be subject to cancellation or withdrawal. Within twenty-four(24)hours of the notice
of award of the sale of the Bonds,the Purchaser shall advise the City and Springsted if 10%of any maturity
of the'Bonds(and,if different interest rates apply within a maturity,to each separate CUSIP number within
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that maturity)has been sold to the public and the price at which it was sold. The City will treat such sale
price as the "issue price" for such maturity, applied on a maturity-by-maturity basis. The City will not
require the Purchaser to comply with that portion of the Regulation commonly described as the"hold-the-
offering-price"requirement for the remaining maturities, but the Purchaser may elect such option. If the
Purchaser exercises such option,the City will apply the initial offering price to the public provided in the
proposal as the issue price for such maturities. If the Purchaser does not exercise that option, it shall
thereafter promptly provide the City and Springsted the prices at which 10%of such maturities are sold to
the public;provided such determination shall be made and the City and Springsted notified of such prices
whether or not the closing date has occurred,until the 10%test has been satisfied as to each maturity of the
Bonds or until all of the Bonds of a maturity have been sold.
GOOD FAITH DEPOSIT
To have its proposal considered for award,the Purchaser is required to submit a good faith deposit to the
City in the amount of$59,350(the"Deposit")no later than 1:30 P.M.,Central Time on the Sale Date. The
Deposit may be delivered as described herein in the form of either(i)a certified or cashier's check payable
to the City;or(ii)a wire transfer. The Purchaser shall be solely responsible for the timely delivery of its
Deposit whether by check or wire transfer. Neither the City nor Springsted have any liability for delays in
the receipt of the]Deposit. If the Deposit is not received by the specified time, the City may, at its sole
discretion,reject the proposal of the lowest bidder,direct the second lowest bidder to submit a Deposit,and
thereafter award the sale to such bidder.
Certified or Cashier's Check. A Deposit made by certified or cashier's check will be considered timely
delivered to the City if it is made payable to the City and delivered to Springsted Incorporated,380 Jackson
Street, Suite 300,Saint Paul,Minnesota 55101 by the time specified above.
Wire Transfer. A Deposit made by wire will be considered timely delivered to the City upon submission
of a federal wire reference number by the specified time. Wire transfer instructions will be available from
Springsted following the receipt and tabulation of proposals. The successful bidder must send an e-mail
including the following information:(i)the federal reference number and time released; (ii)the amount of
the wire transfer;and(iii)the issue to which it applies.
Once an award has been made,the Deposit received from the Purchaser will be retained by the City and no
interest will accrue to the Purchaser. The amount of the Deposit will be deducted at settlement from the
purchase price. In the event the Purchaser fails to comply with the accepted proposal,said amount will be
retained by the City.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost
(TIC)basis calculated on the proposal prior to any adjustment made by the City. The City's computation
of the interest rate of each proposal,in accordance with customary practice,will be controlling.
The City will reserve the right to: (i)waive non-substantive informalities of any proposal or of matters
relating to the receipt of proposals and award of the Bonds, (ii)reject all proposals without cause, and
(iii)reject any proposal that the City determines to have failed to comply with the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
The City has not applied for or pre-approved a commitment for any policy of municipal bond insurance
with respect to the Bonds. If the Bonds qualify for municipal bond insurance and a bidder desires to
purchase a policy,such indication,the maturities to be insured,and the name of the desired insurer must be
set forth on the bidder's proposal. The City specifically reserves the right to reject any bid specifying
municipal bond insurance, even though such bid may result in the lowest TIC to the City. All costs
associated with the issuance and administration of such policy and associated ratings and expenses(other
than any independent rating requested by the City)shall be paid by the successful bidder. Failure of the
municipal bond insurer to issue the policy after the award of the Bonds shall not constitute cause for failure
or refusal by the successful bidder to accept delivery of the Bonds.
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CUSIP NUMBERS
If the Bonds qualify for the assignment of CUSIP numbers such numbers will be printed on the Bonds;
however, neither the failure to print such numbers on any Bond nor any error with respect thereto will
constitute cause for failure or refusal by the Purchaser to accept delivery of the Bonds. Springsted will
apply for CUSIP numbers pursuant to Rule G-34 implemented by the Municipal Securities Rulemaking
Board. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers shall be
paid by the Purchaser.
SETTLEMENT
On or about September 20, 2018,the Bonds will be delivered without cost to the Purchaser through DTC
in New York,New York. Delivery will be subject to receipt by the Purchaser of an approving legal opinion
of Briggs and Morgan, Professional Association, of Minneapolis, Minnesota, and of customary closing
papers,including a no-litigation certificate. On the date of settlement,payment for the Bonds shall be made
in federal,or equivalent,funds that shall be received at the offices of the City or its designee not later than
1200 Noon, Central Time, Unless compliance with the terms of payment for the Bonds has been made
impossible by action of the City,or its agents,the Purchaser shall be liable to the City for any loss suffered
by the City by reason of the Purchaser's non-compliance with said terms for payment.
CONTINUING DISCLOSURE
On the date of actual issuance and delivery of the Bonds,the City will execute and deliver a Continuing
Disclosure Undertaking (the "Undertaking") whereunder the City will covenant for the benefit of the
owners of the Bonds to provide certain financial and other information about the City and notices of certain
occurrences to information repositories as specified in and required by SEC Rule 15c2-12(b)(5).
OFFICIAL STATEMENT
The City has authorized the preparation of a Preliminary Official Statement containing pertinent
information relative to the Bonds, and said Preliminary Official Statement has been deemed final by the
City as of the date thereof within the meaning of Rule 15c2-12 of the Securities and Exchange Commission.
For copies of the Preliminary Official Statement or for any additional information prior to sale, any
prospective purchaser is referred to the Municipal Advisor to the City, Springsted Incorporated, 380
Jackson Street, Suite 300,Saint Paul,Minnesota 55101,telephone(651)223-3000.
A Final Official Statement(as that term is defined in Rule 15c2-12)will be prepared,specifying the maturity
dates,principal amounts,and interest rates of the Bonds, together with any other information required by
law. By awarding the Bonds to the Purchaser,the City agrees that,no more than seven business days after
the date of such award,it shall provide without cost to the Purchaser up to 25 copies of the Final Official
Statement. The City designates the Purchaser as its agent for purposes of distributing copies of the Final
Official Statement to each syndicate member, if applicable. The Purchaser agrees that if its proposal is
accepted by the City,(i)it shall accept designation and(ii)it shall enter into a contractual relationship with
its syndicate members for purposes of assuring the receipt of the Final Official Statement by each such
syndicate member.
Dated July 17,2018 BY ORDER OF TIlE CITY COUNCIL
Is/Diane Ward
City Clerk
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EXHIBIT B
SCHEDULE OF 2018 BONDED CAPITAL OUTLAY
DEPARTMENT PROJECT COSTS
$
TOTAL PROJECT COSTS $
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