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Summary: Centerville, Minnesota; General Obligation Credit Profile US$1.39 mil GO imp rfdg bnds ser 2015A dtd 01/15/2015 due 02/01/2025 Long Term Rating AA/Stable New Centerville GO Long Term Rating AA/Stable Affirmed Rationale Standard&Poor's Ratings Services has assigned its'AA'long-term rating to Centerville,Minn.'s 2015A general obligation(GO)improvement refunding bonds. We also affirmed our'AA'long-term ratings on the city's previously issued GO debt.The outlook on all ratings is stable. A pledge of the city's full faith credit and resources and an agreement to levy ad valorem property taxes without limitation as to rate or amount secure these bonds. It will use bond proceeds to refund the 2016 through 2018 maturities of the city's 2009B GO improvement crossover refunding bonds. The refunding will restructure a 2018 balloon maturity for a more level debt service. The rating reflects our assessment of the following factors for the city, specifically its: • Strong economy,which benefits from participation in the broad and diverse economy of the Minneapolis-St. Paul metropolitan statistical area(MSA); • Strong management with good financial policies; • Very strong budgetary flexibility with 2013 audited reserves at 66%of general fund expenditures; • Adequate budgetary performance,which takes into account structurally balanced general and total governmental funds; • Very strong liquidity providing very strong cash levels to cover both debt service and expenditures;and • Very weak debt and contingent liabilities position,reflecting the city's debt service as a percent of total governmental funds expenditures. Strong economy We consider Centerville's economy strong with access to the broad and diverse economy of the Minneapolis-St.Paul MSA. The Anoka County unemployment rate averaged 5.1%in 2013, on par with the state and below national rates. The city has projected per capita effective buying income of 113%of the U.S.level.Per capita market value for the city is $82,364. Net tax capacity(before tax increments)has decreased five consecutive years,most recently falling 3%for levy year 2014. Management reported recent recovery in housing prices and potential commercial development that likely will lead to an increase in values in 2014 for levy year 2015. WWW.STANDARDANDPOORS.COM/RATINGSDIRECT DECEMBER 2,2014 2 1372557 300238792 97