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Re: RECOMMENDATIONS Recommendations for the Issuance of $1,760,000 General Obligation Improvement Refunding Bonds, Series 2004A We respectfully request your consideration of our recommendations for the above-named Issue. Bond proceeds will be used to refund the March 1, 2005 through 2012 maturities of the City's General Obligation Improvement Bonds, Senes 23, dated March 21, 1997 (the "Series 23 Bonds"). The transaction is being undertaken to achieve interest cost savings. We recommend the following for the Bonds: 2. � !� 5, Action Requested To establish the date and time of receiving bids and establish the terms and conditions of the offering. Sale Date and Time Monday, March 8, 2004 at 10:00 A.M., with considerationfor award by the City Council at 8:00 P.M. that same day. Authority for the Bond Issue Principal Amount of Offering The Bonds are being issued pursuantto Minnesota Statutes, Chapters 475 and 429. $1, 760, 000 Included in the Terms of Proposal for the Bonds is a provision that permits the City to increase or reduce the principal amount of the Bonds in any of the maturities. This allows for any necessary adjustments required based on final interest rates and issuance costs. Repayment Term The Bonds will mature annually March 1,2005 through 2012. Interest will be payable semi-annually each March 1 and September 1, commencing September 1,2004. 6. Security and Payment Cycle (a) Security (b) Source of Payment (c) First Payment Cycle The Bonds will be general obligations of the City. The Bonds will be repaid with a combination of special assessments and ad valorem property taxes. The City will make its first levy for the Bonds in 2004 for collection in 2005. Because the debt service payments on September 1,2004 and March 1,2005 will come due prior to receipt of any levy collection, the City will use funds on hand in the debt service fund, together with 2004 assessment income receipts, to make such payment. Thereafter, each year's first-half