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#5 Authorizing issuance of promissory notes (File Res. #2011-842)ADMINISTRATIVE SERVICES MEMORANDUM October 18, 2011 TO: City Council FROM: Jacob J. Winzenz, Director of Admin. Services\Assistant City Manager SUBJECT: Action on a Proposed Resolution Authorizing the Issuance of $13,970,000 General Obligation Promissory Notes, Series 2011-A, of the City of Janesville, Wisconsin, and Providing the Details Thereof (File Res. #2011-842) Summary The City of Janesville uses a two-step process for the issuance of Promissory Notes. On October 10, 2011, the City Council reviewed the proposed capital program and approved the initial resolution authorizing the issuance of $12,065,000 in promissory notes. At that time the City Council could either increase or decrease the proposed note issue. The City Council will now consider the details resolution (File Resolution 2011-842). At this time the City Council cannot increase the total amount th of the note issue, but can only approve it as is, or decrease the total. On Monday, November 14 the City Council will be asked to award the sale of the notes and we expect to receive to proceeds from the note sale on December 1, 2011. Recommendation Staff has examined each project included in the proposed note issue and deferred a number of projects in order to reduce the debt service impact. I believe the projects included reflect the needs of the community and the priorities of the City Council. I recommend that the City Council approve File Resolution 2011-842 as proposed. City Manager Recommendation The City Manager concurs with the Administrative Services Department recommendation. Suggested Motion I move to approve File Resolution 2011-842 authorizing the issuance of $13,970,000 General Obligation Promissory Notes, Series 2011-A, of the City of Janesville, Wisconsin, and providing the details thereof. Background On October 10, 2011, Council approved Resolution #2011-841 authorizing the issuance of $12,065,000 in promissory notes to fund our annual Capital Improvement Program. The following table indicates the amount of proposed note proceeds that each Fund would receive. 2011 CAPITAL BUDGET/NOTE ISSUE General Fund: Public Works Program$1,455,000 Street Maintenance and Improvements950,000 Renovate Playgrounds/Maintain Equipment40,000 Skate Board Park and Site Restoration100,000 Downtown and Neighborhood Property Acquisitions140,000 Parking Lot Reconstruction - Palmer Drive/Park195,000 Building Maintenance200,000 Fire Station #1500,000 Tallman House300,000 City Services Center - Storage (design)50,000 Cemetery Capital60,000 Golf Course Capital100,000 Technology Enhancements120,000 Fire Vehicle Replacements1,000,000 Public Safety Equipment800,000 $6,010,000 Special Assessments (includes Water and Wastewater)845,000 Water Fund2,235,000 Wastewater Fund1,775,000 Stormwater Fund0 Sanitation Fund200,000 Hedberg Public Library150,000 TIF/Industrial Development Fund850,000 TOTAL$12,065,000 The table below indicates the history of note sales over the last five years. The proposed 2011 issue is approximately 18.9% below the average annual amount issued between the years 2006–2010. 2 HISTORY OF G.O. NOTE SALES 5-Issue Fund20062007200820092010 Average General Fund $6,460,000$4,935,000$6,395,000$7,965,000$3,535,000$5,858,000 Special Assessments 4,275,0002,790,0001,535,000760,00065,000$1,885,000 Water Utility Assessable 1,700,000650,0001,060,00000$682,000 Non-Assessable 3,685,000725,0001,990,0002,145,000970,000$1,903,000 Subtotal Water 5,385,0001,375,0003,050,0002,145,000970,0002,585,000 Wastewater Utility Assessable 2,205,000810,000700,0000200,000$783,000 Non-Assessable 1,555,0003,040,0001,185,000765,000325,000$1,374,000 Subtotal WW 3,760,0003,850,0001,885,000765,000525,0002,157,000 Stormwater Utility Assessable 750,0000220,000$323,333 Non-Assessable 25,0001,045,0001,125,000$731,667 Subtotal Storm 140,00020,000775,0001,045,0001,345,0001,055,000 Sanitation Fund 00465,0001,750,000240,000$491,000 Tax Incremental Districts 620,00070,000915,000625,0001,055,000$657,000 Golf Courses 00000$0 Benefits Internal Service Fund 00000$0 Library 160,000125,000225,000350,00085,000$189,000 TOTAL $20,800,000$13,165,000$15,245,000$15,405,000$7,820,000$14,877,000 General Fund Debt Service 4,395,3814,572,1884,722,3445,292,8695,364,448$4,869,446 Change206,505176,807150,156570,52571,579$235,114 NOTE - Does not include • Water and Wastewater Utility Revenue Bonds • Amount borrowed in 2006 to refund 1999 Promissory Notes $3,175,000 • Amount borrowed in 2009 to refund 2000, 2001, 2002, & 2003 Promissory Notes $9,065,000 In addition to funding our annual capital improvement program, File Resolution 2011-842 authorizes the issuance of $1,905,000 in debt to refund series 2003 and 2003A notes. These notes were callable on August 1, 2011 and carry interest rates ranging from 3.10% to 3.50%. We are proposing calling these notes for 2 reasons. First, for interest savings as current interest rates are estimated to be 2.5% or less. Second, a portion of the 2003 notes are special assessment debt and we would like to reclassify this to General Fund debt. The 2011 General Fund Budget contains a debt service appropriation of $4,983,084. Based upon previously issued General Obligation Debt, our 2012 General Fund debt service appropriation would be $4,735,658. However, we anticipate having to budget approximately $452,921 for debt service, based on an average estimated 2.5% interest rate, related to the proposed 2011 Note Issue. 3 Therefore, our total 2012 debt service appropriation will be approximately $5,188,579 or $205,496 (4.1%) more than the amount budgeted for this year. The General Fund’s share of the authorized issue will be repaid over a term of ten years. Based Graph I upon an anticipated 2.5% interest rate, presents the impact that the proposed issue will have on future annual debt service tax levies. Please note that the amount reported for 2015 does not include our $2,103,000 principal payment related to the 2005 taxable note issue (WRS refinancing). GRAPH I DEBT SERVICE PAYMENT SCHEDULE General Fund Payment Amount (in thousands of dollars) 6,000 5,000 4,000 3,000 2,000 1,000 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed The Special Assessments Projects (non-Water/Wastewater) account will receive $435,000 of note proceeds. We have structured the proposed debt retirement schedule so that the principal will be Graph II, repaid over a term of six years (2012-2017). Please refer to which presents the impact that the proposed note issue will have on the corresponding Special Assessments Projects debt service requirements. 4 GRAPH II DEBT SERVICE PAYMENT SCHEDULE Special Assessments Payment Amount (in thousands of dollars) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed The Water Utility is expected to receive note proceeds totaling $2,030,000. We have structured the proposed debt retirement schedule so that the Water Utility will repay the principal over a Graph III, term of ten years. We have prepared which indicates the effect that the proposed note issue will have on the Water Utility’s annual debt service requirements. Please note that the amount reported for 2016 does not include our $950,000 principal payment related to the 2006A note issue (Water Tower). We have projected that the Utility’s 2012 debt service payment will increase decrease $349,219, or 11.15% from the amount paid in 2011. GRAPH III DEBT SERVICE PAYMENT SCHEDULE Water Utility Payment Amount (in thousands of dollars) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed The Wastewater Utility is expected to receive note proceeds totaling $1,110,000. Please refer to Graph IV, which presents the impact that the proposed note issue will have on the Wastewater 5 Utility’s annual debt service requirements. We have projected that the Utility’s 2012 debt service payment will increase $1,068,001, or 31.33% from the amount paid in 2011. GRAPH IV DEBT SERVICE PAYMENT SCHEDULE Wastewater Utility Payment Amount (in thousands of dollars) 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed The Stormwater Utility is not expected to receive any note proceeds. Sufficient funding is currently Graph V, available to complete proposed projects. Please refer to which presents the impact that the proposed note issue will have on the Stormwater Utility’s annual debt service requirements. GRAPH V DEBT SERVICE PAYMENT SCHEDULE Stormwater Utility Payment Amount (in thousands of dollars) 600 500 400 300 200 100 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed The Hedberg Public Library is expected to receive note proceeds in the amount of $150,000. We Graph VI have prepared to illustrate the effect that the proposed note issue will have on the Library’s annual debt service requirements. Please note that the amount reported for 2015 does 6 not include our $341,000 principal payment related to the 2005 taxable note issue (WRS refinancing). We have projected that the Hedberg Public Library 2012 debt service payment will decrease $25,193, or 10.5% from the amount paid in 2011. GRAPH VI DEBT SERVICE PAYMENT SCHEDULE Hedberg Public Library Payment Amount (in thousands of dollars) 300 250 200 150 100 50 0 `10`11`12`13`14`15`16`17`18`19`20 Years CurrentProposed The Sanitation Fund is expected to receive note proceeds in the amount of $200,000. Prior to 2008, Sanitation fund projects had been funded through the General Fund. The 2011 note repayment has been structured so that the principal will be retired within ten years. We have Graph VII prepared to illustrate the effect that the proposed note issue. GRAPH VII DEBT SERVICE PAYMENT SCHEDULE Sanitation Fund Payment Amount (in thousands of dollars) 1,000 900 800 700 600 500 400 300 200 100 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed 7 The TIF#22 District (Venture Drive) will receive $850,000 for the construction of a business incubator. This is the local match for a grant from the Economic Development Administration. We Graph IX have prepared to illustrate the effect that the proposed note issue will have on the TIF #22 annual debt service requirements. GRAPH IX DEBT SERVICE PAYMENT SCHEDULE TIF 22 –Venture Drive Payment Amount (in thousands of dollars) 1,400 1,200 1,000 800 600 400 200 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed Graph X presents the impact that the proposed note issue will have on the City’s total General Obligation Debt Service requirements. Please note that the amount reported for 2015 does not include our $3,000,000 principal payment related to the 2005 taxable note issue (WRS refinancing) or the $950,000 related to the water tower borrowed with issue 2006A. These notes will be refinanced to extend the term of the debt. 8 GRAPH X DEBT SERVICE PAYMENT SCHEDULE General Obligation Debt-all Funds Payment Amount (in thousands of dollars) 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 `11`12`13`14`15`16`17`18`19`20`21 Years CurrentProposed The Council Policy Statement – “Debt Management” places two (2) limitations on the issuance of debt. First, general obligation debt is limited to 2.5% of the equalized assessed value. If the proposed note issue is approved, general obligation debt will represent 1.89% of the equalized value of the community. Second, annual General Fund debt service payments for General Obligation Debt, exclusive of that funded by enterprise operations or debt approved exceeding the debt limit described above, shall not exceed 15 percent of annual General Fund expenditures. If the proposed note issue is approved, General Fund debt service payments will equal 12.4% of annual General Fund expenditures. In addition, the Council Policies on Debt Management references several debt ratios, which are used by investors and financial rating analysts when they review the City’s credit worthiness. These ratios are: Applicable to Legal Debt Margin; Debt Per Capita – All Funds (G.O. & Revenue Debt); Debt as Percentage of Equalized Value; and General Fund Debt Service as Percentage of Total Actual Exhibit III Expenditures. illustrates these ratios. It should be noted that we are proposing to issue $12,065,000 in new debt, whereas, the total amount of existing debt principal scheduled to be retired this year will total $14,115,021. During the Council Meeting of October 24, 2011, the Council will consider Resolution #2011-842 which will finalize their consideration of City projects, which are proposed to be financed Exhibit I by the issuance of long-term debt (). It should be noted, regarding the General Fund debt service requirements, based upon an average estimated interest rate of 2.5% and a term of ten years, each $100,000 of note proceeds will result in an average annual debt service payment of approximately $11,188. For Council’s reference, also attached is a Memorandum Report, which describes the scope of the Exhibit II individual projects (). This attachment was also included with the previously adopted Resolution #201-841, which authorized the issuance of these notes. If you should require any additional information concerning the overall fiscal impact that the proposed 9 2011 G.O. Note Issue will have on the City’s finances, please feel free to contact me at your convenience. Attachments J:\Finance & Administration\Finance Administration\Debt\Note Issue\Spring 2011\Details Memo.docx 10 RESOLUTION NO. 2011-842 RESOLUTION AUTHORIZING THE ISSUANCE OF $13,970,000 GENERAL OBLIGATION PROMISSORY NOTES, SERIES 2011, OF THE CITY OF JANESVILLE, WISCONSIN, AND PROVIDING THE DETAILS THEREOF Be it resolved by the City Council of the City of Janesville, Wisconsin, as follows: Section 1. Authority and Purpose . This resolution is adopted pursuant to Section 67.12(12) of the Wisconsin Statutes to authorize the issuance of notes for the improvements or purposes described below. First, $12,065,000 for the following purposes: (a) $2,840,000 to construct and improve streets; (b) $0 to construct and improve storm sewers; (c) $335,000 to acquire, improve and maintain parks and public grounds; (d) $1,260,000 to acquire, improve and maintain public buildings and grounds; (e) $3,440,000 to acquire capital equipment; (f) $200,000 to construct and close landfills; (g) $2,030,000 to extend and improve the waterworks system; (h) $1,110,000 to extend and improve the sanitary sewer system; and (i) $850,000 to provide financial assistance for community development. Second, $1,905,000 for the purpose or refunding General Obligation Promissory Notes, Series 2003 and Series 2003-A. The foregoing improvements or purposes are each hereby authorized to be made or undertaken by the City of Janesville, Wisconsin. For the purpose of paying principal of and interest on the notes, there is hereby levied on all the taxable property in the City a direct, annual, irreparable tax sufficient for that purpose. Section 2. Authorization and Terms of Notes . To meet part of the estimated cost of the improvements or purposes described in Section 1 of this resolution, there is hereby appropriated the sum of $13,970,000. For the purpose of financing said appropriation, (i) Series 2011 Notes of the City shall be issued and sold in an aggregate principal amount of $13,970,000 and shall be designated General Obligation Promissory Notes, Series 2011 (the “Notes”). The Notes shall be designated as described in Section 1 and shall be issuable in the denominations of $5,000 or any integral multiple thereof. Each series of Notes shall be numbered consecutively from 1 upwards in order of their issuance and may bear such other identifying numbers or letters as may be useful to facilitate the registration, transfer and exchange thereof. Each Note shall be dated as of the interest payment date next preceding the date of issuance thereof, except that (a) if such date of issuance shall be prior to the first interest payment date, said Note shall be dated as of the date of its initial delivery, (b) if such date of issuance shall be an interest payment date, said Note shall be dated as of such interest payment date, or (c) if interest due on said Note shall not have been paid in full, then, notwithstanding any of the foregoing provisions, said Note shall be dated as of the date to which interest has been paid in full on said Note. The Notes shall mature and bear interest on the dates and in the amounts established by subsequent action of the City Council. The principal of and premium, if any, on the Notes shall be payable in lawful money of the United States of America at the principal corporate trust office of the bank, trust company or national banking association designated in Section 7 of this resolution, as note registrar, or at any additional or successor paying agent or fiscal agent designated by the City pursuant to Section 67.10(2), Wisconsin Statutes. Interest on the Notes shall be payable in lawful money of the United States of America on each interest payment date to the registered owners of record thereof appearing on the registration books maintained by the City for such purpose at the principal office of the note registrar, as of the close of business on the fifteenth day of the calendar month next preceding the applicable interest payment date. Interest on the Notes shall be paid by check or draft mailed to such registered owners at their addresses appearing on the registration books. The Notes shall be subject to redemption prior to maturity as provided by subsequent action of the City Council. In the event of the redemption of less than all of a series of Notes of like maturity, the aggregate principal amount thereof to be redeemed shall be $5,000 or an integral multiple thereof, and the note registrar shall assign each Note of such maturity a distinctive number for each $5,000 principal amount of such Note and shall select by lot from the numbers so assigned as many numbers as, at $5,000 for each number, shall equal the principal amount of such Notes to be redeemed. The Notes to be redeemed shall be the Notes to which were assigned the numbers so selected, provided that only so much of the principal amount of each Note shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. Notice of the redemption of Notes shall be mailed not less than 30 days nor more than 60 days prior to the date fixed for such redemption to the registered owners of Notes to be redeemed at their last addresses appearing on said registration books. The Notes or portions thereof specified in said notice shall become due and payable at the applicable redemption price on the redemption date therein designated, and if, on the redemption date, moneys for payment of the redemption price of all the Notes or portions thereof to be redeemed, together with interest to the redemption date, shall be available for such payment on said date, then from and after the redemption date interest on such Notes or portions thereof shall cease to accrue and shall become payable. If there shall be drawn for redemption less than all of a Note, the City shall execute and the note registrar shall authenticate and deliver, upon the surrender of such Note, without charge to the owner thereof, for the unredeemed balance of the Note so surrendered, Notes of like maturity and of the denomination of $5,000 or any integral multiple thereof. The Notes may be initially issued in temporary form and shall be exchanged for definitive printed Notes as soon as possible. The temporary Notes shall be executed as provided herein and shall be in substantially the form set forth in Section 5 hereof. Section 3. Execution and Authentication of Notes . The Notes shall be executed in the name of the City by the manual or facsimile signatures of its City Manager and City Clerk, 2 and the corporate seal of the City, or a facsimile thereof, shall be thereunto affixed, impressed or otherwise reproduced thereon. In case any officer whose signature, or a facsimile of whose signature, shall appear on any Notes shall cease to hold such office before the issuance of the Notes, such Notes shall nevertheless be valid and sufficient for all purposes, the same as if the person whose signature, or a facsimile thereof, appears on such Notes had not ceased to hold such office. Any Note may be signed, sealed or attested on behalf of the City by any person who, on the date of such act, shall hold the proper office, notwithstanding that at the date of such Note such person may not have held such office. No recourse shall be had for the payment of any Notes against any officer who executes the Notes. The Notes shall bear thereon a certificate of authentication executed manually by the note registrar. No Note shall be entitled to any right or benefit under this resolution or shall be valid or obligatory for any purpose until such certificate of authentication shall have been duly executed by the note registrar. Section 4. General Obligations . The full faith and credit of the City are hereby irrevocably pledged to the punctual payment of the principal of and interest on the Notes. The Notes shall be direct and general obligations of the City, and the City shall be obligated to levy ad valorem taxes upon all the taxable property in the City for the payment of the Notes and the interest thereon, without limitation as to rate or amount. Section 5. Form of Notes . The Notes shall be issued as fully registered Notes and shall be substantially in the following form, the blanks to be appropriately completed when the Notes are printed: 3 [FORM OF NOTE] United States of America State of Wisconsin County of Rock CITY OF JANESVILLE GENERAL OBLIGATION PROMISSORY NOTE SERIES 2011 REGISTERED NO. REGISTERED $ Dated Date Interest Rate Maturity Date CUSIP REGISTERED OWNER: PRINCIPAL AMOUNT: The CITY OF JANESVILLE, a municipal corporation of the State of Wisconsin situate in the County of Rock, acknowledges itself indebted and for value received hereby promises to pay to the registered owner identified above, or registered assigns, the principal amount specified above on the maturity date specified above, unless this note shall be redeemable and shall have previously been called for redemption and payment of the redemption price made or provided for, and to pay interest on such principal amount from the dated date hereof at the interest rate per annum specified above, payable in lawful money of the United States of America on February 1, 2012, and semiannually thereafter on the first days of August and February in each year until the principal amount shall have been paid, by check or draft mailed to the registered owner of record hereof as of the fifteenth day of the calendar month next preceding such interest payment date, at the address of such owner appearing on the registration books maintained by the City for such purpose at the principal corporate trust office of Wells Fargo Bank, N.A., in the City of Chicago, Illinois, as fiscal agent pursuant to Section 67.10(2), Wisconsin Statutes, and as note registrar or its successor (the “Note Registrar”). This note, as to principal and premium, if any, when due, will be payable in lawful money of the United States of America upon presentation and surrender of this note at the office of the Note Registrar. The full faith and credit of the City are irrevocably pledged for the punctual payment of the principal of and interest on this note according to its terms. This note is part of a series of notes issued in the aggregate principal amount of $13,970,000, which are all of like tenor except as to date, maturity, option of redemption and rate of interest. The notes are being issued for the following purposes: (i) to construct and improve streets; (ii) to construct and improve storm sewers; (iii) to acquire, improve and maintain parks and public grounds; (iv) to acquire, improve and maintain public buildings and grounds; (v) to acquire capital equipment; (vi) to construct and close landfills; (vii) to extend and improve the waterworks system; and (viii) to extend and improve the sanitary sewer system, as well as to refund General Obligation Promissory Notes, Series 2003 and Series 2003-A, of the City, including the costs of issuance of the notes. The notes are authorized and issued under and pursuant to Section 67.12(12) of the Wisconsin Statutes and under and in accordance with resolutions adopted by the City Council of the City on October 12, 2011 and entitled: “Resolution Authorizing the Issuance of $12,065,000 in Promissory Notes for Financing Various 4 Public Purposes”; on October 26, 2011 and entitled: “Resolution Authorizing the Issuance of $13,970,000 General Obligation Promissory Notes, Series 2011, of the City of Janesville, Wisconsin, and Providing the Details Thereof”; and on November 14, 2011, and entitled: “Resolution Awarding $13,970,000 General Obligation Promissory Notes, Series 2011, of the City of Janesville, Wisconsin, Establishing Interest Rates Thereon and Levying Taxes Therefor.” The notes maturing on or after February 1, 2020 are subject to redemption prior to maturity as a whole or in part at the option of the City upon notice as herein provided, in any order of maturity and by lot within a single maturity, on February 1, 2019, and on any date thereafter, at a redemption price equal to 100% of the principal amount thereof to be redeemed plus accrued interest to the redemption date and without premium. Notice of the redemption of notes shall be mailed not less than 30 days nor more than 60 days prior to the date fixed for such redemption to the registered owners of notes to be redeemed at their last addresses appearing on such registration books. The notes or portions thereof specified in said notice shall become due and payable at the applicable redemption price on the redemption date therein designated, and if, on the redemption date, moneys for payment of the redemption price of all the notes or portions thereof to be redeemed, together with interest to the redemption date, shall be available for such payment on said date, then from and after the redemption date interest on such notes or portions thereof shall cease to accrue and shall become payable. This note is transferable only upon such registration books by the registered owner hereof in person, or by his attorney duly authorized in writing, upon surrender hereof at the office of the Note Registrar together with a written instrument of transfer satisfactory to the Note Registrar duly executed by the registered owner or by his duly authorized attorney, and thereupon a new registered note or notes, in the authorized denominations of $5,000 or any integral multiple thereof and of the same aggregate principal amount, maturity and interest rate as this note shall be issued to the transferee in exchange therefor. In like manner, this note may be exchanged for an equal aggregate principal amount of notes of the same maturity and interest rate and of any of such authorized denominations. The City or the Note Registrar may make a charge sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to the transfer or exchange of this note. No other charge shall be made for the privilege of making such transfer or exchange. The City and the Note Registrar may treat and consider the person in whose name this note is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal, premium, if any, and the interest due hereon and for all other purposes whatsoever. This note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been duly executed by the Note Registrar. It is hereby certified, recited and declared that all acts, conditions and things required to be done, exist and be performed precedent to and in the issuance of this note in order to make it a legal, valid and binding obligation of the City have been done, exist and have been performed in regular and due time, form and manner as required by law, that a direct, annual, irreparable tax has been levied by the City sufficient to pay the interest when it falls due and also to pay and discharge the principal at maturity, and that the series of notes of which this note is one, together with all other indebtedness of the City, is within every debt or other limit prescribed by law. IN WITNESS WHEREOF, the CITY OF JANESVILLE has caused this note to be executed in its name and on its behalf by the manual or facsimile signatures of its City Manager 5 and its City Clerk, and its corporate seal, or a facsimile thereof, to be hereunto affixed or otherwise reproduced hereon. CITY OF JANESVILLE By City Manager By City Clerk 6 CERTIFICATE OF AUTHENTICATION Date of Authentication: This note is one of the General Obligation Promissory Notes, Series 2011, described in the within mentioned resolutions. WELLS FARGO BANK, N.A., as Note Registrar By Authorized Officer ASSIGNMENT For value received the undersigned sells, assigns and transfers unto the within note and hereby irrevocably constitutes and appoints attorney to transfer the said note on the books kept for registration thereof, with full power of substitution in the premises. Dated Signature Guaranty: Section 6. Transfer, Exchange and Registry . The Notes shall be negotiable, subject to the provisions for registration of transfer contained herein. Each Note shall be transferable only upon the registration books maintained by the City for that purpose at the office of the note registrar, by the registered owner thereof in person or by his attorney duly authorized in writing, upon surrender thereof together with a written instrument of transfer satisfactory to the note registrar and duly executed by the registered owner or his duly authorized attorney. Upon the surrender for transfer of any such Note, the City shall execute and the note registrar shall authenticate and deliver a new Note or Notes registered in the name of the transferee, of the same aggregate principal amount, maturity and interest rate as the surrendered Note. Notes, upon surrender thereof at the office of the note registrar, with a written instrument satisfactory to the note registrar, duly executed by the registered owner or his attorney duly authorized in writing, may be exchanged for an equal aggregate principal amount of Notes of the same maturity and interest rate and of the denominations of $5,000 or any integral multiple thereof. For every such exchange or registration of transfer of Notes, the City or the note registrar may make a charge sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer, which sum or sums shall be paid by the person requesting such exchange or transfer as a condition precedent to the exercise of the privilege of making such exchange or transfer. No other charge shall be made for the privilege of making such transfer or exchange. 7 The note registrar shall not be required to transfer or exchange any Note after notice of the redemption of all or a portion thereof has been mailed. The note registrar shall not be required to transfer or exchange any Note during a period of 15 days next preceding the mailing of a notice of redemption that could designate for redemption all or a portion of such Note. The City and the note registrar may deem and treat the person in whose name any Note shall be registered upon the registration books as the absolute owner of such Note, whether such Note shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of, premium, if any, or interest thereon and for all other purposes whatsoever, and all such payments so made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Note to the extent of the sums or sums so paid, and neither the City nor the note registrar shall be affected by any notice to the contrary. In order to provide for the initial issuance of the Notes in a form that provides for a system of book-entry only transfers, the ownership of one fully registered Note for each maturity in the aggregate principal amount of such maturity shall be registered in the name of Cede & Co., as a nominee of The Depository Trust Company, New York, New York (“DTC”). In the event that the City determines that the system of book-entry only transfers through DTC (or a successor securities depository) is not in the best interests of the Beneficial Owners (as hereinafter defined) of the Notes or is burdensome to the City, the City may notify DTC, whereupon DTC will notify the DTC Participants (as hereinafter defined) of the availability through DTC of Note certificates. In such event, the City shall issue and the note registrar shall authenticate, transfer and exchange note certificates as requested by DTC of like principal amount, series and maturity, in denominations of $5,000 or any integral multiple thereof to the identifiable Beneficial Owners, in replacement of such Beneficial Owners’ beneficial interests in the Notes. For the purposes of this paragraph, the term “Beneficial Owners” shall mean (a) those persons for whom DTC was created to hold their securities (“DTC Participants”), and (b) the persons for whom the DTC Participants acquire interests in the Notes as nominees. Section 7. Note Registrar . The City has contracted with and designated Wells Fargo Bank, N.A., Chicago, Illinois, to serve as fiscal agent pursuant to Section 67.10(2), Wisconsin Statutes, and as note registrar. The City covenants that it maintain at the designated office of such note registrar a place where Notes may be presented for payment and registration of transfer or exchange and that it shall require that the note registrar maintain proper registration books and perform the other duties and obligations imposed upon it by this resolution in a manner consistent with the standards, customs and practices of the municipal securities business. The note registrar shall signify its acceptance of the duties and obligations imposed upon it by this resolution by executing the certificate of authentication on any Note, and by such execution the note registrar shall be deemed to have certified to the City that it has all requisite power to accept, and has accepted, such duties and obligations not only with respect to the Note so authenticated but with respect to all the Notes. The note registrar is the agent of the City and shall not be liable in connection with the performance of its duties except for its own negligence or default. The note registrar shall, however, be responsible for any representation in its certificate of authentication on the Notes. The City may remove the note registrar at any time. In case at any time the note registrar shall resign or shall be removed or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or if a receiver, liquidator or conservator of the note registrar, or of its property, shall be appointed, or if any public officer shall take charge or control of the 8 note registrar or of its property or affairs, the City covenants and agrees that it will thereupon appoint a successor note registrar. The City shall mail notice of such appointment made by it to each registered owner of Notes within 20 days after such appointment. Any successor note registrar appointed under the provisions of this Section, other than the Finance Director, shall be a bank, trust company or national banking association maintaining a corporate trust office in the State of Wisconsin, the City of Chicago, Illinois, or the Borough of Manhattan, City and State of New York. Section 8. Sale of Notes . The Notes shall be advertised for sale by the City Clerk in the manner provided herein, and the City Clerk is authorized to circulate an Official Statement prepared by Wisconsin Public Finance Professionals, LLC, Milwaukee, Wisconsin, and an Official Notice of Sale. When the Notes shall have been sold, this Council will adopt the proceedings to award the Notes, fix the interest rates thereon in accordance with the bid accepted, and levy taxes to meet principal thereof and interest thereon at maturity as required by law. Section 9. Application and Investment of Note Proceeds . Following the sale of the Notes, the City Manager and City Clerk are hereby authorized and directed to execute and deliver the Notes to the purchasers thereof upon payment therefor; and the principal proceeds from the sale of the Notes shall be used only for the purposes and in the manner required by law and by this resolution. The proceeds may be invested in the manner permitted by law, subject to the restrictions contained in the next succeeding section. Section 10. Tax Covenants . (a) The City shall not take, nor omit to take, any action that is lawful and within its power to take, which action or omission would cause interest on any Note to become subject to federal income taxes in addition to federal income taxes to which interest on such Note is subject on the date of issuance thereof. (b) The City shall not permit any of the proceeds of the Notes, or any facilities financed with such proceeds, to be used in any manner that would cause any Note to constitute a “private activity bond” within the meaning of Section 141 of the Internal Revenue Code of 1986 (the “Code”). (c) The City shall not permit any of the proceeds of the Notes or other moneys to be invested in any manner that would cause any Note to constitute an “arbitrage bond” within the meaning of Section 148 of the Code. (d) The City shall comply with the provisions of Section 148(f) of the Code relating to the payment of certain investment earnings at periodic intervals to the United States of America; provided, however, that such payment shall not be required to the extent the City receives an opinion of nationally recognized bond counsel (which opinion may be given in reliance upon a ruling or rulings of the Internal Revenue Service) to the effect that such payment is not necessary to preserve the exemption from federal income taxes of interest on the Notes. (e) The City does not designates the Notes as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Code. 9 Section 11. Continuing Disclosure . In connection with the sale of the Notes, the Director of Administrative Services/Assistant City Manager or his designee (an “Authorized Officer”) is hereby authorized to execute and deliver a Continuing Disclosure Undertaking (the “Continuing Disclosure Undertaking”) evidencing the City’s agreement to comply with the requirements of Section (b)(5) of Rule 15c2-12, adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934. Upon its execution and delivery on behalf of the City as herein provided, the Continuing Disclosure Undertaking will be binding on the City, and the officers, employees and agents of the City are hereby authorized to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the provisions of the Continuing Disclosure Undertaking as executed. Any Authorized Officer is hereby further authorized to amend the Continuing Disclosure Undertaking in accordance with its respective terms from time to time following its execution and delivery as said officer shall deem necessary. In addition, an Authorized Officer is authorized to make or cause to be made all future filings with the Municipal Securities Rulemaking Board with respect to any debt obligations, all in accordance with the provisions of Securities and Exchange Commission Rule 15c2-12(b)(5) promulgated under the Securities Exchange Act of 1934. Notwithstanding any other provision of this Resolution, the sole remedies for any failure by the City to comply with the Continuing Disclosure Undertaking shall be the ability of the beneficial owner of any applicable Note to seek mandamus or specific performance by court order to cause the City to comply with its obligations under the Continuing Disclosure Undertaking. Section 12. Defeasance and Payment of Notes . (a) If the City shall pay or cause to be paid to the registered owners of the Notes of a series the principal, premium, if any, and interest due or to become due thereon, at the times and in the manner stipulated therein and in this resolution, then the pledge of taxes, securities and funds hereby pledged and the covenants, agreements and other obligations of the City to the registered owners and the beneficial owners of the Notes shall be discharged and satisfied. (b) Any Notes, whether at or prior to the maturity or the redemption date of such Notes, shall be deemed to have been paid within the meaning of this Section if (i) in case any such Notes are to be redeemed prior to the maturity thereof, there shall have been taken all action necessary to call such Notes for redemption and notice of such redemption shall have been duly given or provision shall have been made for the giving of such notice, and (ii) there shall have been deposited in trust with a bank, trust company or national banking association acting as fiduciary for such purpose either (A) moneys in an amount which shall be sufficient, or (B) “Federal Obligations” as defined in paragraph (c) of this Section, the principal of and the interest on which when due will provide moneys which, together with any moneys on deposit with such fiduciary at the same time for such purpose, shall be sufficient to pay when due the principal of, redemption premium, if any, and interest due and to become due on said Notes on and prior to the applicable redemption date or maturity date thereof. (c) As used in this Section, the term “Federal Obligations” means (i) noncallable, direct obligations of the United States of America, (ii) noncallable and nonprepayable, direct obligations of any agency of the United States of America, which are unconditionally guaranteed by the United States of America as to full and timely payment of principal and interest, (iii) noncallable, nonprepayable coupons or interest installments from the securities described in clause (i) or clause (ii) of this paragraph, which are stripped pursuant to programs of the Department of the Treasury of the 10 United States of America, or (iv) coupons or interest installments stripped from bonds of the Resolution Funding Corporation. Section 13. Resolution To Constitute a Contract . The provisions of this resolution shall constitute a contract between the City and the owner or owners of the Notes. Any pledge made in this resolution and the provisions, covenants and agreements herein set forth to be performed by or on behalf of the City shall be for the equal benefit, protection and security of the owners of any and all of the Notes. All of the Notes, regardless of the time or times of their issuance, shall be of equal rank without preference, priority or distinction of any of the Notes over any other thereof except as expressly provided in or pursuant to this resolution. This resolution and the resolution awarding the Notes, fixing the interest rates and levying taxes for the payment thereof shall constitute full authority for the issuance of the Notes and, to the extent that the provisions of this resolution conflict with the provisions of any other resolution of the City, the provisions of this resolution, as amended, shall control. If any section, paragraph or provision of this resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this resolution. Section 14. Notice . The City Clerk is authorized to publish a notice of the issuance of the Notes as a class 1 notice pursuant to Section 893.77, Wisconsin Statutes. Section 15. Effective Date . This resolution shall become effective immediately upon its passage, the public welfare requiring it ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Brunner Dongarra-Adams Eric J. Levitt, City Manager Liebert McDonald ATTEST: Rashkin Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: ______________________________ Wald Klimczyk, City Attorney Proposed by: Administrative Services Department Prepared by: Director of Administrative Services 11 Ü»¾¬ ÐÛÎ ÝßÐ×Ìß ßÔÔ ÚËÒÜÍ Ù»²»®¿´ Ѿ´·¹¿¬·±² Ü»¾¬ $ Amount Percent 100 1500 80 1200 60 900 40 600 20 300 0 0 2001200220032004200520062007200820092010 2001200220032004200520062007200820092010 Year Year Ù»²»®¿´ Ú«²¼ ÙòÑò Ü»¾¬ Ù»²»®¿´ Ѿ´·¹¿¬·±² Ü»¾¬ PercentPercent 520 416 3 12 2 8 1 4 0 0 2001200220032004200520062007200820092010 2001200220032004200520062007200820092010 Year Year Attachment II 2011 Note Issue Project Descriptions Construct and Improve Streets - $2,840,000 (a) New and Replacement Sidewalks - $540,000 This program totals $540,000 (General Fund - $210,000; Assessable - $330,000) to construct new sidewalks and to replace deteriorated sidewalk and/or sidewalk with other safety deficiencies. Included is the first year of a seven (7) year plan to implement the Pedestrian Transportation Corridor Plan (PTCP). General Fund costs for new and replacement sidewalk include curb ramps, sidewalk crossing city owned property (greenbelts, parks, etc.) and other miscellaneous costs typically paid by the city at large. (b) Curb and Gutter Replacement and Reconstruction - $688,000 This program totals $688,000 (General Fund – 675,000; Assessable - $13,000) to replace damaged curb and gutter as well as eliminate areas of water ponding in conjunction with the street reconstructions and resurfacing programs. Prior to 2010 half of this program has been funded through Special Assessments against the abutting property owners. As proposed for 2011 costs for curb replacement and reconstruction will be paid by the city at-large, except for areas where replacement is requested by the property owner for aesthetic reasons. (c) Street Maintenance and Improvements - $1,042,000 This program includes funds to maintain City streets and make various other improvements to the street network such as intersection and railroad crossing improvements. In 2011 $1,042,000 is proposed for this program (General Fund - $950,000; Assessable – $92,000). (d) Major Arterials and Connecting Highways - $460,000 This category proposes a total of $460,000 in funding for 2011. There are several projects that provide for preliminary engineering on projects. This funding provides the local match to federal funding in most cases.  A roundabout is proposed for construction at the intersection of Milwaukee Street and Wuthering Hills Drive. The total estimated cost is $451,000 with $395,000 provided through a Highway Safety Improvement Program grant and $55,000 from local funds.  North Main Street is scheduled for resurfacing in 2013. Total project costs are estimated to be $1,530,000 with $1,216,000 provided in federal funding and a local share of $314,000. Proposed for 2011 is $55,000 as the local share of the design and engineering costs ($265,000) Attachment II  South Pearl Street from Court Street to Rockport Road is being reconstructed. Total project costs are estimated to be $502,000 with $152,000 provided through the Local Road Improvement Program (LRIP) and $350,000 through local funds. (e) Palmer Drive Bridge Repairs and Railing Replacement - $110,000 With the reconstruction of Palmer Drive it made sense to repair the bridge over Spring Brook and replace the railing on the bridge. Construct and Improve Storm Sewers – No new funding necessary at this time (a) System Improvements - $505,000 System Improvements total $505,000 for enhancements to the existing storm drainage system. Proposed projects include:  Areas within the Stormwater collection system can develop capacity deficiencies or other problems which require enhancements to properly manage current and projected stormwater flow. Storm Sewer enhancement projects in 2011 are expected to cost $195,000. Planned projects include: S. Pearl Street from W. Court Street to W. Racine Street and E. Holmes Street from Jackman Street to Sinclair Street. Planned projects may change based upon need.  Storm sewer repair projects totaling $200,000 have been identified for 2011. Planned projects include: Benton Avenue from Prairie Avenue to Eisenhower Avenue; E. Holmes Street east of Ringold Street within an easement at St. Paul’s Church; and Clark Street from Main Street to the Rock River. Projects can change if other repairs are identified and are considered higher priority.  Rehabilitating or replacing manholes in conjunction with street resurfacing and reconstruction projects prevents future failures of the structures after a new street surface has been placed. In 2011 funding in the amount of $110,000 is proposed. Some manholes only need repairs to the upper portion and other manholes that need total replacement. Acquire, Improve & Maintain Parks and Public Grounds - $475,000 (a) Replace Playground Equipment - $40,000 In 1996, the City began a program to renovate/replace playground equipment in neighborhood parks. To date, renovations have been completed at 30 neighborhood parks at a cost of approximately $40,000 for each neighborhood park. The renovation/replacement of playground equipment will continue in 2011, with improvements proposed for Rushmore Park ($40,000). (b) Skateboard Park and Site Restoration - $100,000 An at-grade skate park is proposed at the former batting cage location on S. Attachment II Jackson Street. The total project is estimated to cost $135,000 which includes ramps and other features for skate boarders, as well as grading and seeding of this property and other City-owned property to the north. Of the total project costs, $35,000 will be provided through private donations and $100,000 from the City. (c) Property Acquisitions (downtown and neighborhood) - $140,000 Major downtown and neighborhood planning efforts have recommended that the City become more active in the acquisition of vacant and/or blighted properties in the downtown and older residential neighborhoods. Available Community Development Block Grant funds are not sufficient for this effort. Funding in the amount of $140,000 is proposed for such property acquisitions. (d) Parking Lot Reconstruction at Palmer Park - $195,000 The parking lot adjacent to Palmer Drive which serves CAMDEN Playground and the wading pool was reconstructed along with Palmer Drive. The parking lot was physically separated from Palmer Drive to prevent parked vehicles from backing into travel lanes. Additional parking stalls were also created. Acquire, Improve & Maintain Public Buildings and Grounds - $1,120,000 (a) Building Maintenance - $200,000 Each year, funds are required for minor building maintenance projects at City facilities. In 2011, improvements totaling $200,000 are proposed for several public buildings. The locations may include the Municipal Building, various park and recreational facilities, and Senior Center. This is slightly less than prior years because significant federal EECDBG funds were used to make improvements to several facilities. (b) Central Fire Station - $500,000 The central fire station and administrative offices (Fire Station #1) was constructed in 1957 and no longer meets the space or operational needs of the Fire Department. Initial funding for design and site acquisition was provided in 2006 ($150,000), 2007 ($350,000), and 2008 ($500,000). An additional $500,000 is proposed for 2011 to complete the funding requirements for site acquisition and design. The estimated construction cost is $6,500,000. (c) Tallman House - $300,000 In 2009 an architectural firm was retained to complete a property conditions report on the Tallman House. This report indicates that repairs in excess of $2,000,000 are necessary and the facility. Funding in the amount of $250,000 was provided in 2009. The 2011 note issue includes $300,000 to continue funding these repairs. (d) City Services Center Storage (design) - $50,000 Attachment II The Parks Division has an acute need for storage of mowers and other equipment. Much of their equipment is stored in buildings which are awaiting demolition. As these buildings are demolished the Parks Division must find new places to store their equipment. When the City Services was designed and constructed provisions were made to expand the structure to the north. Funding in the amount of $50,000 is proposed to identify the storage needs of the Parks Division, as well as other divisions, and design solutions to meet that need. (e) Cemetery Capital - $60,000 Proposed for the 2011 note issue is funding in the amount of $60,000 for various capital items at the Cemetery including centralizing the water distribution system, acquiring equipment to develop a computer inventory of lots, and repairs to the roads within the cemetery. (f) Library Parking Lot Resurfacing - $10,000 The parking lot behind the library will be resurfaced and restriped. This lot was last resurfaced in 1996 making it 15 years old. This does not include the lot the library shares with JPAC. Acquire Capital Equipment - $3,440,000 (a) Technology Enhancements - $220,000 The City will continue implementation of the Information Technology Strategic Plan. This plan addresses improving the efficiency of City services and providing citizen satisfaction through the use of information technology. In 2011, funds are requested from the General Fund ($120,000), Water Utility ($50,000) and Wastewater Utility ($50,000) to obtain consulting services and purchase hardware and software for the implementation of specific citywide information technology priority projects, as determined by the City Manager. (b) Library Technology Enhancements - $140,000 The library will be replacing all 102 computers for public use and all 57 computers used by staff. All the computers being replaced are at least 5 years old. Updated software will also be purchased and installed on the computers. In addition, 4 printers and 4 bar code scanners will be replaced, and several new security cameras will also be added. Lastly, a Microfilm 6000 machine will be purchased to replace our outdated microfilm reader (which we can no longer get parts to service). (c) Golf Course Capital - $100,000 The lease on the golf course expired at the end of 2010 and the City is now responsible for the operation and maintenance of the courses. When the lease ended we acquired an aged fleet of maintenance equipment from the lessee. Funding in the amount of $100,000 is included to begin replacing the maintenance Attachment II equipment over the next several years. (d) Variable Frequency Drives - $430,000 This project includes installation of 17 variable frequency drives and associated controls at Pumping Stations 4, 5, 7, 10, 12 and 14. The work includes installation of equipment within existing motor control center structures for well and booster pumps at each site. (e) Biogas Energy Enhancements at Wastewater Treatment Plant - $750,000 Upgrades to the Wastewater Treatment Plant are proposed to increase the amount of biogas produced and the ability to convert that biogas into energy. Enhancements include gas conditioning equipment ($100,000), CNG vehicle fueling station ($200,000), 200 KW microturbine ($300,000), CNG modifications to 5 vehicles ($40,000), high strength waste receiving station ($20,000), and other miscellaneous costs ($90,000). (f) Fire Vehicle Replacement - $1,000,000 Several pieces of fire equipment are scheduled for replacement including a 1997 quint with a 75’ ladder (to be replaced with a rescue pumper - $470,000), a 1990 tanker ($320,000), and a 2000 ambulance ($210,000). (g) Public Safety Equipment - $800,000 In order to comply with Federal Communications Commission (FCC) requirements to narrow-band public safety radio frequencies, most public safety radio systems in the County must be upgraded. Rock County has taken the lead on this effort and has agreed to take over the public safety radio system in the County. This proposal includes the costs to replace our mobile radios and upgrade the radio system prior to the County assuming ownership. Construct and Close Landfills - $200,000 (a) Gas Collection System Upgrades - $100,000 Current operations at the sanitary landfill have resulted in increased odors and complaints from residents. This project makes improvements to the temporary gas collection system to reduce odors and maintain compliance with the City’s EPA air permit. (b) Phase I Closure - $100,000 These funds will be utilized to install permanent landfill gas collection wells in Cell 1 of the operating landfill. These wells are being installed ahead of permanent closure of this cell, which is scheduled for 2012. The permanent wells replace temporary wells which were installed in 2009. Attachment II Construct and Extend Water Mains - $2,030,000 (a) System Improvements - $1,730,000  Undersize main replacements totaling $355,000 are proposed for 2011. This program is needed to replace undersized water mains (replace 1-1/2 inch and 4- inch mains with 6 inch mains) in the distribution system. There are approximately 9 miles of undersized mains in the system. Replacement is done in coordination with street restoration projects. Funds requested will replace about 2,200 feet of mains.  In 2005, the Water Utility implemented a lead services replacement program within the City. This program is similar to the iron service replacement activities the City has historically undertaken. The actual cost of this program will vary from year to year based upon the number of lead services under streets that are being reconstructed in any given year. Currently, there are about 2,400 lead services in the City. In 2011, the Water Utility proposes to replace 55 lead services ($90,000).  Prior to street reconstruction, the condition of the water manholes and valves in the street are evaluated. Old, deteriorated manholes are either rehabilitated or replaced prior to the street work. This helps insure the long term integrity of the street so that a newer street surface would not have to be dug up shortly after the work to replace a failing manhole. For 2011, $70,000 is proposed for this program.  The Main Reinforcement program addresses identified weaknesses in the existing water distribution system by adding transmission mains or upgrading distribution mains to transmission mains. In 2011, Phase II of the Blackbridge Road main is scheduled. The total project estimate is $2,715,000 with $1,500,000 provided in 2010 and the balance ($1,215,000) provided in 2011. (b) System Expansion - $300,000 (c) Development Main Extensions – water mains extended to serve new developments. Cost - $300,000; Assessable Portion - $275,000. Construct and Extend Sewer Mains - $1,110,000 (a) System Improvements - $875,000  Janesville has approximately 140 miles of clay pipe in the sanitary sewer collection system that ranges in age from 40 to 100 years. Most of the clay pipe is structurally sound, but suffers from root intrusion and infiltration of groundwater. Proposed for 2010 is $805,000 in funding, which will reline about 3 – 3-1/2 miles of sanitary sewer main. This is the ninth year of a multi-year program, which reduces the potential for clogged sewers resulting from root Attachment II growth and also ensures the continued structural integrity of the clay sewers.  This is an ongoing multi-year program to prevent water inflow and infiltration into the sanitary sewer system. This program has focused primarily on sanitary sewer manholes in the past, but its focus has now shifted to sewer laterals. For 2011 funding in the amount of $195,000 is proposed. (b) System Expansion - $235,000  Development Sewer Extensions – sewer mains extended to serve new developments. Cost - $235,000; Assessable Portion - $135,000. Provide Financial Assistance for Community Redevelopment - $850,000 (a) Funding in the amount of $850,000 is included as the local match towards a U.S. Economic Development Administration grant to construct a business incubator in TIF No. 22.