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DRAFT 09/10/10 CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE I, the undersigned, being the duly qualified and acting recording officer of the City of Missoula, Montana (the “City”), hereby certify that the attached resolution is a true copy of Resolution No. entitled: “RESOLUTION RELATING TO UP TO $11,500,000 TAXABLE SEWER SYSTEM REVENUE BONDS, SERIES 2010 (RECOVERY ZONE ECONOMIC DEVELOPMENT BONDS); AUTHORIZING THE ISSUANCE OF THE BONDS THROUGH A NEGOTIATED SALE THEREOF; AUTHORIZING THE MAYOR AND CITY FINANCE DIRECTOR/TREASURER TO SELECT AN UNDERWRITER THROUGH A REQUEST FOR PROPOSAL PROCESS; AND MAKING CERTAIN DECLARATIONS TO SATISFY THE REIMBURSEMENT REGULATIONS OF THE INTERNAL REVENUE CODE” (the “Resolution”), on file in the original records of the City in my legal custody; that the Resolution was duly adopted by the City Council of the City at a regular meeting on September 20, 2010, and that the meeting was duly held by the City Council and was attended throughout by a quorum, pursuant to call and notice of such meeting given as required by law; and that the Resolution has not as of the date hereof been amended or repealed. I further certify that, upon vote being taken on the Resolution at said meeting, the following Council Members voted in favor thereof: voted against the same: abstained from voting thereon: or were absent: WITNESS my hand officially this day of September, 2010. City Clerk ---PAGE BREAK--- RESOLUTION NO. RESOLUTION RELATING TO UP TO $11,500,000 TAXABLE SEWER SYSTEM REVENUE BONDS, SERIES 2010 (RECOVERY ZONE ECONOMIC DEVELOPMENT BONDS); AUTHORIZING THE ISSUANCE OF THE BONDS THROUGH A NEGOTIATED SALE THEREOF; AUTHORIZING THE MAYOR AND CITY FINANCE DIRECTOR/TREASURER TO SELECT AN UNDERWRITER THROUGH A REQUEST FOR PROPOSAL PROCESS; AND MAKING CERTAIN DECLARATIONS TO SATISFY THE REIMBURSEMENT REGULATIONS OF THE INTERNAL REVENUE CODE BE IT RESOLVED by the City Council (the “Council”) of the City of Missoula, Montana (the “City”), as follows: Section 1. Recitals. 1.01. The City is authorized pursuant to Title 7, Chapter 13, Part 43, Montana Code Annotated, to establish, operate and maintain a municipal sewer system. The City is authorized pursuant to Title 7, Chapter 7, Parts 44 and 45, Montana Code Annotated, as amended (the “Act”) to issue its revenue bonds to finance in whole or in part the cost of the acquisition, purchase, construction, reconstruction, improvement, betterment or extension of its sewer system facilities. The City is authorized pursuant to Section 1400U-2 of the Internal Revenue Code of 1986, as amended (the “Code”) to issue recovery zone facility bonds for capital expenditures paid or incurred with respect to property within a recovery zone. Pursuant to Resolution No. 2009-123 of Missoula County adopted September 30, 2009, Missoula County, including the City, has been designated a “recovery zone” for purposes of the Code. The City has been allocated $10,100,000 and has applied for an additional $[1,500,000] of recovery zone economic development bonding authority pursuant to Section 1400U-1 of the Code, Resolution No. 2009- 124 of Missoula County, Montana Code Annotated Section 17-5-116, and the Montana Department of Administration’s Recovery Zone Bond Allocation Policy. Montana Code Annotated , Section 7-7-140 authorizes the City to designate and issue its sewer system revenue bonds as recovery zone economic development bonds. 1.02. Pursuant to Montana Code Annotated Section 17-5-117, the City is authorized to negotiate the sale of sewer system revenue bonds designated as recovery zone economic development bonds. 1.03. The Council investigated the facts necessary and hereby finds, determines and declares it to be necessary and desirable for the City to offer for sale up to $11,500,000 Taxable Sewer System Revenue Bonds, Series 2010 (Recovery Zone Economic Development Bonds) (the “Bonds”) for the purpose of engineering, designing, constructing, and installing certain improvements to the headworks of the existing sewer system and related improvements (the “Project”) and for funding certain costs incidental to the sale and payment of Bonds and to fund the debt service reserve securing the Bonds; and (ii) to designate the Bonds as “recovery zone economic development bonds.” ---PAGE BREAK--- 2 Section 2. Term of the Bonds. Pursuant to the authority described above, this Council shall issue and sell Bonds of the City in the aggregate principal amount not to exceed $11,500,000 for the purpose of providing funds to construct and install the Project, funding the debt service reserve, and paying certain costs incidental to the sale and issuance of the Bonds. The Bonds shall be issued in one series designated “Taxable Sewer System Revenue Bonds, Series 2010 (Recovery Zone Economic Development Bonds)”, shall be payable over a term not to exceed 25 years. Interest shall be payable semiannually on January 1 and July 1 of each year commencing July 1, 2011, at the rate or rates which shall be approved by the Council pursuant to a subsequent resolution. Section 3. Authorization to Proceed with RFP for Underwriter. 3.01. Based upon the complexities and timing of issuing the Bonds as taxable Economic Recovery Zone Development Bonds, Springsted, Inc., of St. Paul, Minnesota (“Springsted”), the City’s financial advisor and the City Finance Director/Treasurer have recommended a negotiated sale of the Bonds. This Council hereby confirms a negotiated sale to be in the City’s best interest. 3.02. The City Finance Director/Treasurer, in consultation with Springsted, is authorized to prepare and submit a request for proposals (“RFP”) for underwriters for the Bonds. 3.03. Upon receipt of responses to the RFP, the Mayor and City Finance Director/Treasurer, in consultation with Springsted, are hereby authorized to select an underwriter for the Bonds and proceed with the preparation of the documents necessary for the issuance of the Bonds. Section 4. Preliminary Official Statement. The City Finance Director/Treasurer, City Clerk and other officers of the City, in cooperation with in cooperation with Springsted, financial consultants to the City, and Dorsey & Whitney LLP, bond counsel to the City, are hereby authorized and directed to prepare a Preliminary Official Statement to be distributed to potential purchasers of the Bonds. Such preliminary official statement shall contain such information as shall be advisable and necessary to describe accurately the City and the security for, and terms and conditions of, the Bonds. The City Finance Director/Treasurer is authorized on behalf of the City to deem such Preliminary Official Statement “near final” as of its date, in accordance with Rule 15c2-12(b)(1) under the Securities Exchange Act of 1934. Section 5. Reimbursement; Official Intent Declaration. 5.01. The City proposes to design and construct the Project. 5.02. Other than expenditures to be paid or reimbursed from sources other than the Bonds, (ii) expenditures permitted to be reimbursed under the transitional provision contained in Section 1.150-2(j)(2) of the Regulations, (iii) expenditures constituting preliminary expenditures within the meaning of Section 1.150-2(f)(2) of the Regulations, or (iv) expenditures in a “de minimus” amount (as defined in Section 1.150-2(f)(1) of the Regulations), no expenditures for the Project have heretofore been paid by the City and no expenditures will be paid by the City until after the date of this Resolution. ---PAGE BREAK--- 3 5.03. The City reasonably expects to reimburse some or all of the expenditures made for costs of the Project out of the proceeds of debt to be issued in an estimated maximum aggregate principal amount of $11,500,000 after the date of payment of all or a portion of the costs of the Project. All reimbursed expenditures shall be capital expenditures, a cost of issuance of the Bonds or other expenditures eligible for reimbursement under Section 1.150-2(d)(3) of the Regulations. Section 6. Budgetary Matters. As of the date hereof, there are no City funds reserved, allocated on a long-term basis or otherwise set aside (or reasonably expected to be reserved, allocated on a long-term basis or otherwise set aside) to provide permanent financing for the expenditures related to the Project, other than pursuant to the issuance of the Bonds. The statement of intent contained in this Resolution, therefore, is determined to be consistent with the City’s budgetary and financial circumstances as they exist or are reasonably foreseeable on the date hereof. Section 7. Reimbursement Allocations. The City Financial Services Manager shall be responsible for making the “reimbursement allocations” described in the Regulations, being generally the transfer of the appropriate amount of proceeds of the Bonds to reimburse the source of temporary financing used by the City to make prior payment of the costs of the Project. Each allocation shall be evidenced by an entry on the official books and records of the City maintained for the Bonds or the Project and shall specifically identify the actual original expenditure being reimbursed. PASSED by the City Council of the City of Missoula, Montana, on this 20th day of September, 2010. Mayor ATTEST: City Clerk