PRELIMINARY OFFICIAL STATEMENT DATED FEBRUARY 17, 2009 REFUNDING ISSUE - FULL BOOK-ENTRY BANK QUALIFIED

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1 THIS COVER PAGE CONTAINS CERTAIN INFORMATION FOR QUICK REFERENCE ONLY. IT IS NOT A SUMMARY OF THIS ISSUE. INVESTORS MUST READ THE ENTIRE OFFICIAL STATEMENT TO OBTAIN INFORMATION ESSENTIAL TO THE MAKING OF AN INFORMED INVESTMENT DECISION. PRELIMINARY OFFICIAL STATEMENT DATED FEBRUARY 17, 2009 REFUNDING ISSUE - FULL BOOK-ENTRY BANK QUALIFIED NOT RATED In the opinion of Gilmore & Bell, P.C., Bond Counsel, under existing law and assuming continued compliance with certain requirements of the Internal Revenue Code of 1986, as amended (the Code ), the interest on the Bonds is excludable from gross income for federal and Nebraska income tax purposes, except as described herein, and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations. The Bonds are qualified tax-exempt obligations within the meaning of Section 265(b)(3) of the Code. See TAX MATTERS. OFFICIAL STATEMENT $4,090,000 * SALINE COUNTY SCHOOL DISTRICT 0002 (CRETE PUBLIC SCHOOLS) IN THE STATE OF NEBRASKA GENERAL OBLIGATION REFUNDING BONDS, SERIES 2009 Dated: Date of Delivery Due: January 1 as set forth on the inside cover The Bonds will be issued only in fully registered form and, when initially issued, will be registered in the name of Cede & Co., as the nominee of The Depository Trust Company ( DTC ), New York, New York, which will act as securities depository for the Bonds. Purchases of the Bonds will be made in book-entry form, in the principal amount of $5,000 or any integral multiple thereof, through brokers and dealers who are, or who act through, DTC participants. Beneficial owners of the Bonds will not receive physical bond certificates so long as DTC or a successor securities depository acts as the security depository with respect to the Bonds. Interest is payable on January 1 and July 1 of each year, beginning July 1, So long as DTC or its nominee is the registered owner of the Bonds, payments of the principal or redemption price of and interest on the Bonds will be made directly to DTC. Disbursement of such payments to DTC participants is the responsibility of DTC, and disbursement of such payments to the beneficial owners is the responsibility of DTC participants. The District Treasurer, in Crete, Nebraska, is bond registrar and paying agent for the Bonds. For terms relating to principal and interest payments made to DTC or its nominee or in the event that the use of book-entry form is discontinued, see THE BONDS - Book-Entry System. The Bonds maturing on or after January 1, 2015 are subject to redemption prior to maturity at the option of the District at anytime on or after March 3, 2014 as set forth under THE BONDS Optional Redemption. The District will use the proceeds of the Bonds to (a) provide for the redemption and payment on or about March 23, 2009, of $3,995,000 principal amount of the District s General Obligation School Bonds, Series 2002, dated as of November 15, 2002 (the Refunded Bonds ) at a redemption price equal to 100% of the principal amount thereof plus accrued interest thereon to the date of redemption, and (b) pay the costs of issuing the Bonds. The Bonds are general obligations of the District payable from ad valorem taxes, unlimited as to rate and amount, levied against all of the taxable property of the District. The full faith, credit, resources, and taxing powers of the District have been irrevocably pledged to the payment of the principal or redemption price of and interest on the Bonds. See SECURITY. MATURITY SCHEDULE SEE INSIDE COVER The Bonds are offered in book-entry form only when, as and if issued, subject to the approving legal opinion of Gilmore & Bell, P.C., Lincoln, Nebraska Bond Counsel. Delivery of the Bonds in definitive form through DTC is expected on or about March 3, EDWARD JONES D.A. DAVIDSON & CO. * Preliminary; subject to change. This Official Statement is dated, 2009.

2 MATURITY SCHEDULE $4,090,000 * SALINE COUNTY SCHOOL DISTRICT 0002 (CRETE PUBLIC SCHOOLS) IN THE STATE OF NEBRASKA GENERAL OBLIGATION REFUNDING BONDS, SERIES 2009 Maturity Principal Rate of CUSIP No. (January 1) Amount* Interest Yield Price (795176) , , , , , , , ,000 * Preliminary; subject to change.

3 SALINE COUNTY SCHOOL DISTRICT 0002 (CRETE PUBLIC SCHOOLS) IN THE STATE OF NEBRASKA GENERAL OBLIGATION REFUNDING BONDS, SERIES 2009 Board of Education Matt Hanson, President Bill Lorenz, Vice President Laura Ebke, Secretary Dennis Isernhagen, Member Tom King, Member Thad Sears, Member Superintendent of Schools Kyle McGowan Administrative Staff Sandy Rosenboom, Business Manager Lynette King, Treasurer UNDERWRITERS Edward Jones D.A. Davidson & Co. REGISTRAR AND PAYING AGENT District Treasurer Crete, Nebraska BOND COUNSEL Gilmore & Bell, P.C.

4 REGARDING USE OF THIS OFFICIAL STATEMENT AUTHORIZED INFORMATION AND REPRESENTATIONS No dealer, broker, sales representative or other person has been authorized by the District or the Underwriters to give any information or to make any representations, other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. Statements contained in this Official Statement that involve estimates, forecasts or matters of opinion, whether or not expressly so described herein, are intended solely as such and are not to be construed as representations of fact. The information and expressions of opinion contained herein are subject to change without notice and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the District since the date hereof. The Underwriters have provided the following sentence for inclusion in this Official Statement: The Underwriters have reviewed the information in this Official Statement in accordance with, and as part of, their responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the accuracy or completeness of such information. This Official Statement is not to be construed as a contract with the purchaser of any Bond. REGISTRATION EXEMPTION The Bonds have not been registered with the United States Securities and Exchange Commission under the Securities Act of 1933, as amended (the Securities Act ), in reliance upon an exemption contained in the Securities Act. In making an investment decision, investors must rely upon their own examination of the District and the terms of the offering, including the merits and risks involved. No federal or state securities commission or regulatory authority has recommended the Bonds. Moreover, none of the foregoing authorities has confirmed the accuracy or determined the adequacy of this Official Statement. Any representation to the contrary is a criminal offense. FORWARD-LOOKING STATEMENTS This Official Statement contains statements that are forward-looking statements as defined in Section 27a of the Securities Act of 1933 and Section 21e of the Securities Exchange Act of When used in this Official Statement, the words estimate, intend, expect and similar expressions are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Official Statement.

5 TABLE OF CONTENTS Page INTRODUCTION... 1 THE DISTRICT... 2 PLAN OF FINANCING... 2 THE BONDS... 3 SECURITY... 5 NEBRASKA LAWS RELATED TO BUDGETS AND TAXATION... 5 LEGAL MATTERS... 7 TAX MATTERS... 8 MISCELLANEOUS APPENDIX A: THE DISTRICT GENERAL INFORMATION...A-1 APPENDIX B: THE DISTRICT FINANCIAL STATEMENTS... B-1 APPENDIX C: THE CITY OF CRETE, NEBRASKA GENERAL INFORMATION... C-1 APPENDIX D: FORM OF CONTINUING DISCLOSURE CERTIFICATE...D-1 APPENDIX E: BOOK-ENTRY SYSTEM... E-1 THE UNDERWRITERS INTEND TO OFFER THE BONDS INITIALLY AT THE OFFERING PRICES SET FORTH ON THE INSIDE COVER OF THIS OFFICIAL STATEMENT, WHICH MAY SUBSEQUENTLY CHANGE WITHOUT ANY REQUIREMENT OF PRIOR NOTICE. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET, AND SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. -i-

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7 OFFICIAL STATEMENT $4,090,000 * SALINE COUNTY SCHOOL DISTRICT 0002 (CRETE PUBLIC SCHOOLS) IN THE STATE OF NEBRASKA GENERAL OBLIGATION REFUNDING BONDS, SERIES 2009 INTRODUCTION This introduction is only a brief description and summary of certain information contained in this Official Statement and is qualified in its entirety by reference to more complete and detailed information contained in the entire Official Statement, including the cover page and appendices hereto, and the documents summarized or described herein. A full review should be made of the entire Official Statement. Purpose of the Official Statement The purpose of this Official Statement is to furnish information relating to (1) Saline County School District 0002 (Crete Public Schools) in the State of Nebraska (the District ) and (2) the General Obligation Refunding Bonds, Series 2009 (the Bonds ), of the District, dated the date of delivery thereof, issued in the aggregate principal amount of $4,090,000*. The District The District is a class III school district and political subdivision organized and existing under the laws of the State of Nebraska, maintaining both elementary and high school grades under the direction of a single board of education, and embracing all of the territory within a city of the first class of the State of Nebraska having a population of more than one thousand and less than one hundred fifty thousand inhabitants, including such adjacent territory as may be attached for school purposes. See THE DISTRICT. The Bonds The Bonds are being issued pursuant to a resolution (the Bond Resolution ) passed by the Board of Education (the Board ) of the District for the purpose of providing for the payment and redemption on or about March 23, 2009 of $3,995,000 principal amount of the District s General Obligation School Bonds, Series 2002, dated as of November 15, (the Outstanding Bonds ) at a redemption price equal to 100% of the principal amount thereof plus accrued interest thereon to the date of redemption. See THE BONDS and PLAN OF FINANCING. Security and Source of Payment The Bonds are general obligations of the District payable from ad valorem taxes, unlimited as to rate and amount, levied against all of the taxable property in the District. The full faith, credit, resources, and taxing powers of the District have been irrevocably pledged to the payment of the principal or redemption price of and interest on the Bonds. See SECURITY. * Preliminary; subject to change.

8 Financial Statements Audited financial statements of the District, as of and for the year ended August 31, 2008, are included in APPENDIX B THE DISTRICT FINANCIAL STATEMENTS. These financial statements have been audited by Dana F. Cole & Company, LLP, Lincoln Nebraska, independent certified public accountants, to the extent and for the periods indicated in their report, which is also included in APPENDIX B THE DISTRICT FINANCIAL STATEMENTS. General THE DISTRICT The District is a class III school district and political subdivision organized and existing under the laws of the State of Nebraska. The District includes all of the City of Crete, Nebraska and surrounding unincorporated areas and encompasses approximately 148 square miles and has an estimated population of 8,000 in See APPENDIX A: THE DISTRICT GENERAL INFORMATION. Summary Financial Statements and Operating Statistics Taxable valuation (2008) $647,908,411 General obligation bonded debt (including leases and the Bonds) $4,090,000 Principal amount of lease related debt $0 Current enrollment 1,504 Total General Fund expenditures for most recent Fiscal Year $15,233,088 Total number of employees current Fiscal Year 244 Authorization of Bonds PLAN OF FINANCING The Bonds are authorized pursuant to and in full compliance with the Constitution and statutes of the State of Nebraska, including, without limitation, Chapter 10, Article 7, Reissue Revised Statutes of Nebraska, as amended. The Bonds are being issued pursuant to the Bond Resolution for the purpose of (a) providing for the payment and redemption of the Refunded Bonds and (b) paying the costs of issuing the Bonds. Refunding of Series 2002 Bonds The Bonds are being issued to refund all of the Outstanding Bonds, which are part of an issue in the principal amount of $6,380,000 of General Obligation School Bonds, Series 2002, dated as of November 15, 2002 (the Series 2002 Bonds ) issued to pay the costs of constructing a building or buildings for use by three or more middle level grades and providing the necessary furniture, equipment and apparatus for such school building or buildings (the Project ). The District will use $4,030, from the proceeds of the Bonds to pay and redeem on or about March 23, 2009 (the Redemption Date ) of all of the Refunded Bonds. Sources and Uses of Funds The following table summarizes the estimated sources of funds and the expected uses of such funds in connection with the plan of financing: -2-

9 Sources of Funds: Principal Amount of Bonds $ Total $ Uses of Funds: Redemption of Refunded Bonds Deposit to Debt Service Fund Costs of Issuance $ Total $ THE BONDS General The Bonds will be issued in the principal amount of $5,000 or any integral multiple thereof, be dated the date of delivery thereof (the Dated Date ), bear interest from the Dated Date payable on January 1 and July 1 of each year, commencing July 1, 2009, mature on January 1 in the years and the principal amounts, and bear interest at the rates (calculated on the basis of a 360-day year consisting of twelve 30- day months) set forth on the inside cover. Each installment of interest is payable by check or draft mailed by the Registrar on the due date (or on the next business day if such due date falls on a Saturday, Sunday or bank holiday applicable to the Registrar) to the registered owner of any Bond shown on the bond registration records of the District maintained by the Registrar as of the Record Date (hereinafter defined). The principal of each Bond is payable only upon the surrender of such Bond to the Registrar. The Record Date for each payment of interest shall be the fifteen day (whether a business day or not) of the month next preceding the due date for such interest payment. Book-Entry System General. The Depository Trust Company ( DTC ) will act as securities depository for the Bonds. The ownership of one fully registered Bond for each maturity, as set forth on the inside cover hereof, each in the aggregate principal amount of such maturity, will be registered in the name of Cede & Co., as DTC s nominee. Ownership interests in the Bonds will be available to purchasers through a book-entry system maintained by DTC (the Book-Entry System ). A description of DTC, the Book-Entry System and definitions of initially capitalized terms used under this caption are found in APPENDIX E - BOOK- ENTRY SYSTEM. Risk Factors. Beneficial Owners of the Bonds may experience some delay in their receipt of distributions of the principal or redemption price of and interest on the Bonds because such distributions will be forwarded by [Registrar], the bond registrar and paying agent for the Bonds (the Registrar ), to DTC, credited by DTC to its Direct Participants, and then credited to the accounts of the Beneficial Owners either directly or indirectly through Indirect Participants. Because transactions in the Bonds can only be effected through DTC, DTC Participants and certain banks, the ability of a Beneficial Owner to pledge Bonds to persons or entities that do not participate in the Book-Entry System, or otherwise to take actions in respect of such Bonds, may be limited due to the lack of physical certificates. The Registrar will not recognize Beneficial Owners as registered owners for purposes of the Bond Resolution, and Beneficial Owners will be permitted to exercise the rights of registered owners only indirectly through DTC and DTC Participants. -3-

10 Optional Redemption Bonds maturing on or prior to January 1, 2014 are not subject to redemption prior to their stated maturities. Bonds maturing on or after January 1, 2015 are subject to redemption prior to maturity in whole or in part, on or after March 3, 2014, in the principal amounts and from the maturity or maturities selected by the District, and by lot in integral multiples of $5,000 within a maturity, at a redemption price equal to 100% of the principal amount being redeemed, plus accrued interest thereon to the redemption date. Notice and Effect of Call for Redemption. In the event of redemption of Bonds, the Registrar will give written notice of redemption by first class mail to the registered owner of each Bond to be redeemed, such notice to be mailed not less than 30 days prior to the redemption date. Notice of redemption having been given as required, the Bonds or portions thereof to be redeemed shall become due and payable on the redemption date and from and after the redemption date (unless the District defaults in the payment of the redemption price) such Bonds or portion thereof shall cease to bear interest. So long as DTC is effecting book-entry transfers of the Bonds, the Registrar will provide the notices of Bonds to be redeemed to DTC. It is expected that DTC will notify the DTC Participants and that the DTC Participants will notify or cause to be notified the Beneficial Owners. Any failure on the part of DTC or a DTC Participant, or failure on the part of a nominee of a Beneficial Owner of a Bond (having been mailed notice from the Registrar, a DTC Participant or otherwise) to notify the Beneficial Owner of the Bond so affected, will not affect the validity of the redemption of such Bond. Interchangeability and Transfer Each Bond when issued shall be registered by the Registrar in the name of the owner thereof on the Bond Register. Bonds are transferable only upon the Bond Register upon presentation and surrender of the Bonds, together with instructions for transfer. Bonds may be exchanged for Bonds in the same aggregate principal amount and maturity upon presentation to the Registrar, subject to the terms, conditions and limitations set forth in the Bond Resolution and upon payment of any tax, fee or other governmental charge required to be paid with respect to any such registration, transfer or exchange. In all cases in which the privilege of exchanging or transferring the Bonds is exercised, the District shall execute and the Registrar shall deliver the Bonds in accordance with the Bond Resolution. For every such transfer or exchange of Bonds, the Registrar shall require the payment by the registered owner requesting such transfer or exchange of any tax or other governmental charges payable with respect thereto, and may charge a sum not exceeding the actual cost for each new Bond. The foregoing procedures will not apply to the Bonds so long as they held are in book-entry form. The transfer and exchange of Bonds held in book-entry form will be governed by the procedures described in APPENDIX E - BOOK-ENTRY SYSTEM. SECURITY The full faith, credit, resources and taxing powers of the District have been irrevocably pledged to the payment of the principal or redemption price of and interest on the Bonds. The District has the power and is obligated to levy ad valorem taxes without limitation as to rate or amount upon all property subject to taxation by the District sufficient to pay the principal or redemption price of and interest on the Bonds, which taxes shall be in excess of and in addition to all other taxes now or hereafter authorized to be levied by the District. -4-

11 NEBRASKA LAWS RELATED TO BUDGETS AND TAXATION The District s principal sources of revenue for its general fund are local property taxes and state aid. LB 988, adopted by the Legislature in 2008, revised the state aid formula for Nebraska school districts. Student adjustment weightings and a variety of other factors, including taxable valuations and per-student costs, are used to determine the amount of state aid received by a Nebraska school district. Certain budget limitations relating to Nebraska school districts are discussed in detail below. Section 79-10,120, Reissue Revised Statutes of Nebraska, as amended, authorizes the District to establish a special fund (the Building Fund ) for the purpose of acquiring sites for school buildings, including the sites upon which such buildings are located, and the erection, alteration, equipping and furnishing of school buildings and additions to school buildings for elementary and high school grades. The Building Fund is established from the proceeds of the levy of a tax of not to exceed 14 per $100 upon the taxable value of all taxable property of the District (hereinafter, the Building Fund Levy ). For the current fiscal year, the District has levied 0.9 per $100 of taxable valuation in the District for a Building Fund Levy, which is expected to generate $58,570 for the District s Special Building Fund. Expenditures from the District s Building Fund are exempt from the Budget Limitations described below, but are not exempt from the Levy Limitations described below. In recent years, the Legislature has enacted legislation intended to limit the level of property taxation by, and expenditures of, all political subdivisions in the State of Nebraska, including school districts. Section , Reissue Revised Statutes of Nebraska, as amended, and related sections (the Budget Limitations ), limit the growth in general fund budget expenditures for Nebraska school districts. Section , Reissue Revised Statutes of Nebraska, as amended, and related sections (the Levy Limitations ), provide for an overall limitation on the tax levies of Nebraska school districts. However, the Budget Limitations do not limit expenditures for debt service on bonded indebtedness, nor do they limit Building Fund and other special fund expenditures, because the Budget Limitations only apply to general fund budget expenditures. Similarly, the Levy Limitations also expressly exclude from their scope any property taxes levied for bonded indebtedness secured by a levy on property. Consequently, the ad valorem taxes levied by the District to pay the principal or redemption price of and interest on the Bonds are not subject to either the Budget Limitations or the Levy Limitations. Pursuant to the Budget Limitations, the Nebraska Department of Education (the Department ) is required to annually determine the maximum general fund budget of expenditures for each Nebraska school district, other than expenditures for special education and expenditures from special grant funds (each as described in the Nebraska statutes) which is then used to determine the school district s general fund budget expenditures for a particular fiscal year. The maximum general fund budget of expenditures is calculated for the District in part by using the base limitation set forth in Section , Reissue Revised Statutes of Nebraska, as amended ( Section ), which is set at 2.5% for the fiscal year and subsequent fiscal years and which is updated in certain cases by the Department with reference to certain cost factors calculated by the Department pursuant to Nebraska statutes. The Budget Limitations for Nebraska school districts are enforced through the Office of the Auditor of Public Accounts for the State of Nebraska, and state and local funds may be withheld from school districts that fail to comply. Pursuant to the Levy Limitations, property tax levies have been limited for each type of political subdivision in the State of Nebraska, and the limit for the District is $1.05 per $100 upon the taxable value of all taxable property in the District. As mentioned, taxes levied by the District to pay bonded indebtedness secured by a levy on property are not included in the Levy Limitations. -5-

12 Future financing options available to political subdivisions within the State of Nebraska, including Nebraska school districts, may be altered depending upon future amendments to the Nebraska Constitution, future actions taken by the Legislature and future decisions of the Nebraska Supreme Court. Legal Proceedings LEGAL MATTERS As of the date hereof, there is no controversy, suit or other proceeding of any kind pending or threatened in or by which any question is raised or may be raised, questioning, disputing or affecting in any way the legal organization of the District or its boundaries, or the right or title of any of its officers to his or her respective office, or the legality of any official act in connection with the authorization, issuance and sale of the Bonds, or the constitutionality or validity of the Bonds or any of the proceedings had in relation to the authorization, issuance or sale thereof, or the levy and collection of a tax to pay the principal and interest thereof, or which might affect the District s ability to meet its obligations to pay the Bonds. Approval of Legality All legal matters incident to the authorization and issuance of the Bonds are subject to the approval of Gilmore & Bell, P.C., Lincoln, Nebraska, Bond Counsel. Bond Counsel has participated in the preparation of this Official Statement, but the factual and financial information appearing herein has been supplied or reviewed by certain officials of the District and certified public accountants. Opinion of Bond Counsel TAX MATTERS Federal and Nebraska Tax Exemption. In the opinion of Gilmore & Bell, P.C., Bond Counsel, under existing law, the interest on the Bonds is excludable from gross income for federal and Nebraska income tax purposes. Interest on the Bonds is not an item of tax preference for purposes of computing the federal alternative minimum tax imposed on individuals and corporations but is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on certain corporations. The opinions set forth in this paragraph are subject to the condition that the District comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon be, or continue to be, excludable from gross income for federal and Nebraska income tax purposes. The District has covenanted to comply with all such requirements. Failure to comply with certain of such requirements may cause the inclusion of interest on the Bonds in gross income for federal and Nebraska income tax purposes retroactive to the date of issuance of the Bonds. Bank Qualification. The Bonds are qualified tax-exempt obligations within the meaning of Section 265(b)(3) of the Code, and, in the case of certain financial institutions (within the meaning of Section 265(b)(5) of the Code), a deduction is allowed for 80 percent of that portion of such financial institution s interest expense allocable to interest on the Bonds. No Other Opinions. Bond Counsel expresses no opinion regarding other federal, state or local tax consequences arising with respect to the Bonds. Other Tax Consequences Prospective purchasers of the Bonds should be aware that ownership of the Bonds may result in collateral federal income tax consequences to certain taxpayers, including, without limitation, financial institutions, property and casualty insurance companies, individual recipients of Social Security or Railroad -6-

13 Retirement benefits, certain S corporations with excess net passive income, foreign corporations subject to the branch profits tax, life insurance companies, and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry or have paid or incurred certain expenses allocable to the Bonds. Bond Counsel expresses no opinion regarding these tax consequences. Purchasers of Bonds should consult their tax advisors as to the applicability of these tax consequences and other federal income tax consequences of the purchase, ownership and disposition of the Bonds, including the possible application of state, local, foreign and other tax laws. Underwriting MISCELLANEOUS The Underwriters have agreed, subject to certain conditions, to purchase the Bonds from the District at a price equal to $, (par amount of $4,090,000 less an underwriting discount in the amount of $ ). The Underwriters are purchasing the Bonds from the District for resale in the normal course of their business activities. The Underwriters reserve the right to offer any of the Bonds to one or more purchasers on such terms and conditions and at such price or prices as the Underwriters, in their discretion, shall determine. Continuing Disclosure Prior to issuing the Bonds, the District will execute and deliver a Continuing Disclosure Certificate for the benefit of the beneficial owners of the Bonds to provide certain financial information and operating data of the District not later than 15 days after a written request, and to provide notices of the occurrence of certain enumerated events, if material. The proposed form of the Continuing Disclosure Certificate of the District is attached as APPENDIX D FORM OF CONTINUING DISCLOSURE CERTIFICATE. These covenants have been made in order to assist the Underwriters in complying with SEC Rule 15c2-12(b)(5) (the Rule ). A failure by the District to comply with the Continuing Disclosure Certificate will not constitute a default under the Bond Resolution, although beneficial owners will have any available remedy at law or in equity. Any such failure must be reported in accordance with the Rule and must be considered by any broker, dealer or municipal securities dealer before recommending the purchase or sale of the Bonds in the secondary market. Consequently, such a failure may adversely affect the transferability and liquidity of the Bonds and their market price. The District is in compliance with each prior undertaking made by it pursuant to the Rule. Independent Auditors The financial statements of the District, as of and for the year ended August 31, 2008, included in APPENDIX B THE DISTRICT FINANCIAL STATEMENTS, have been audited by Dana F. Cole & Company, LLP, Lincoln, Nebraska, independent auditors, as stated in their report appearing therein. Certification and Other Matters Regarding Official Statement Information set forth in this Official Statement has been furnished or reviewed by certain officials of the District, certified public accountants, and other sources, as referred to herein, which are believed to be reliable. Any statements made in this Official Statement involving matters of opinion, estimates or projections, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates or projections will be realized. -7-

14 Simultaneously with the delivery of the Bonds, the District will furnish to the Underwritera a certificate which shall state, among other things, that to the best knowledge and belief of the officer signing the certificate, this Official Statement (and any amendment or supplement hereto) as of the date of sale and as of the date of delivery of the Bonds does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements herein, in light of the circumstances under which they were made, not misleading in any material respect. The form of this Official Statement, and its distribution and use by the Underwriters, has been approved by the District. Neither the District nor any of its officers, directors or employees, in either their official or personal capacities, has made any warranties, representations or guarantees regarding the financial condition of the District or the District s ability to make payments required of it; and further, neither the District nor its officers, directors or employees assumes any duties, responsibilities or obligations in relation to the issuance of the Bonds other than those either expressly or by fair implication imposed on the District by the Bond Resolution. This Official Statement is issued by the District. -8-

15 THE DISTRICT - GENERAL INFORMATION APPENDIX A

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17 THE DISTRICT General The District is organized as a Class III School District, under Article 4, Chapter 79, Reissue Revised Statutes of Nebraska, as amended. The District covers approximately 148 square miles and has an estimated population of 8,000. The boundaries of the District include the city of Crete, the towns of Sprague, Martell, Denton, Hallam and Kramer and the surrounding rural areas in Saline, Seward and Lancaster counties. The District operates a senior high school, a middle school, and an elementary school. Current total enrollment of the District is approximately 1,504. Total enrollments have remained risen over the past ten years. The District employs approximately 133 certificated staff members and 111 support staff members and is accredited by the State of Nebraska Board of Education and the North Central Association of Colleges and Schools. The following table lists the schools currently operated by the District: School Name/Address Crete High School (9-12) 1500 East 15 th Street Crete Middle School 1700 Glenwood Avenue Crete Elementary School 920 Linden Avenue Principal Mr. Timothy Conway Ms. Kimberly Jacobson Mr. Bret Schroeder Administration The District is governed by a Board of Education, which is composed of six elected Board members. The Superintendent of Schools is an appointed official. The Board is responsible for the organizational and financial control of the District. The Superintendent is responsible for the administration of the District s business affairs and the supervision of instruction. The Superintendent of Schools is Kyle McGowan who served as Director of Instruction until becoming Superintendent in Budgetary Process The Superintendent, with input from the staff, principals and interested community groups, prepares a recommended budget and submits it to the Board, which may modify it. The Board adopts a budget which is submitted along with the Annual Financial report to the State of Nebraska Department of Education. The budget is designated as the Official Budget and governs the general operations for the fiscal year unless amended by the Board. The budget process begins in January and is passed at the regular Board of Education meeting in August. Under applicable statutes limitations are imposed upon increases which may be made in the School District s general fund budget from year to year. See NEBRASKA DEVELOPMENTS RELATED TO BUDGETS AND TAXATION in the Official Statement. A-1

18 School District Budget Limitations The School District s principal sources of revenue for its general fund are local property taxes and state aid. State aid is allocated to school districts based upon statutory formulas which take into consideration taxable valuations, student population, per student costs and a variety of other factors. The School District s current budget is governed by the provisions of the Budget Limitations (as described and defined in the Official Statement) which are discussed under NEBRASKA DEVELOPMENTS RELATED TO BUDGETS AND TAXATION in the Official Statement. The Levy Limitations (as described and defined in the Official Statement) also discussed under NEBRASKA DEVELOPMENTS RELATED TO BUDGETS AND TAXATION in the Official Statement will limit the tax levies for subsequent fiscal years thereafter. Such limitations do not affect the District s ability to levy and collect taxes sufficient to pay the principal of and interest on the Bonds. General Fund Revenue Sources The District s General Fund revenues are derived from State appropriations, from local sources of funds and from property taxes. The District has budgeted $6,821,350 for the school year to be received from property taxes for its general levy. It also anticipates the following receipts from sources shown: State Apportionment $ 160,000 State Aid (State Aid is paid in 10 equal installments beginning in October) 5,764,753 Other income distributed over the Fiscal Year ,535,050 The Budget reflects a 6.72% increase in expenditures and an increase of 8.2% in revenues from The District s levy is projected to produce approximately $6,821,350 in tax collections. The amount of State aid announced by the Nebraska Department of Education for the District for the budget year is $5,764,753, representing an increase in the amount of $358,278. (Source: School District) See NEBRASKA DEVELOPMENTS RELATED TO BUDGETS AND TAXATION in the Official Statement. Special Building Fund Sections and 79-10,120, Reissue Revised Statutes of Nebraska, as amended, provide for a special building fund tax levy of not to exceed 14 cents on each one hundred dollars of assessed valuation. The District has utilized this levy in the past and its building levy for the fiscal year was set at 0.9 and is expected to generate $58,570. The District anticipates using such funds for remodeling buildings, as needed. The District will need an annual building fund levy in each year during the foreseeable future in order to fund its ongoing capital improvement program and insure an adequate remodeling and renovation schedule. Pursuant to state laws and regulations, the special building fund also includes expenditures for projects funded by general obligation bonds. A-2

19 Special Building Fund Cash Expenditures 200 to Site Acquisition and Improvement $ Building, Acquisition and Improvement 5,491, , Other Expenses (Loan payments) 59,380 6,951 6,558 6,160 5,762 Special Building Fund Total 5,550, ,767 6,558 6,160 5,762 General Fund Capital Outlay 492, , , ,268 Employee Relations The District s teachers are represented by the Crete Education Association. The Board believes that its relationship with the employees is excellent. Negotiations for the teachers contract for the school year were completed in October, STATISTICAL DATA Enrollment Trend School Year Grades K-6 Grades 7-12 TOTAL A-3

20 Faculty and Staff Assignments Administrators Teacher/Certified Custodians Food Service Office Personnel Maintenance/Facilities Para-Professional Technicians Special Programs (grants) Nebraska School Employees Retirement System The Nebraska School Employees Retirement Act (Sections to , Reissue Revised Statutes of Nebraska, as amended, the Retirement Act ) establishes a retirement system for school employees in the State (the System ), except employees of the Omaha Public Schools which are governed by a separate set of statutes. The System became effective (under prior statutes) in The Retirement Act requires payments by the State to fund, based upon actuarial calculations, unfunded accrued liabilities of the System which are not funded by the required contributions of participating school employees and contributions of the school districts. Section of the Retirement Act currently requires school district employees to contribute 7.83% of compensation for fiscal year ending August 31, 2007 and 7.28% thereafter. The same section currently requires school districts to contribute an amount equal to 101% of the contributions of their employees. The unfunded accrued liability as of July 1, 2008 for all covered employees within the Nebraska School Employee Retirement System amounted to $718,416,111*. The State contribution to the System for the fiscal year ending June 30, 2008 was $15,832,941. No additional State contribution is required for the fiscal year to pay the normal cost and amortize any unfunded liabilities for the Nebraska School System. * Source: School Retirement System of the State of Nebraska System Actuary s Report, for plan year beginning July 1, 2008, 56 th Actuarial Report November TAX STRUCTURE Values for Tax Levy Purposes Increase (Decrease) vs. Prior Year School Year Valuation Amount Percent $365,044,786 15,393, % ,956,461 54,919, % ,180,997 28,224, % ,854,665 11,673, % ,375, ,520, % ,797,200 38,421, % ,908,411 43,111, % Source: School District A-4

21 HISTORY OF DISTRICT LEVIES (Dollars per $100) School General Building Bond Year Fund Fund Fund Fund Total $ $ $ $ $ Source: School District SCHEDULE OF TAX COLLECTIONS (General Fund) Taxes Amount Uncollected Percent School Year Certified (as of October 1, 2008) Collections General Obligation Bonds DEBT MANAGEMENT General obligation bonds other than refunding bonds may be issued by a Nebraska school district only if approval is given by a majority of the district's voters. School bonds, qualified zone academy bonds and certain limited tax obligation bonds may be issued without the approval of the electorate. Crete Public Schools is a Class III school district, and as such has no legal limit on the amount of bonded indebtedness that may be incurred under Nebraska laws. Debt Payment Record The District has never defaulted on its obligation to pay principal of or interest on its indebtedness. Outstanding Indebtedness The District presently has $3,995,000 in general obligation indebtedness outstanding. A-5

22 DIRECT, OVERLAPPING AND UNDERLYING DEBT GENERAL OBLIGATION BONDS (as of December 31, 2008) Actual General Percent Amount Valuation Obligation Applicable Applicable Description 2008 Bonded Debt to District to District Direct Debt School District 0002 $647,908,411 $3,995, % $3,995,000 Overlapping and Underlying Debt Saline County $ 1,133,626,718 $ 5,400, ,784,160 Lancaster County* 18,786,286,695 61,720, ,392 Seward County 1,502,670, Gage County 1,686,001,778 2,850, City of Crete 244,932,075 4,410, ,410,000 Crete Airport Authority 244,932, , ,000 *Includes the Lincoln-Lancaster County Public Building Commission and the Lancaster County Fairgrounds Joint Public Agency, in addition to Lancaster County. Total Direct, Overlapping and Underlying Debt $15,174,407 Property Tax Collections DEBT RATIO INFORMATION Ratio of Direct Bonded Debt to Actual Valuation 0.62% Ratio of Direct, Overlapping and Underlying Bonded Debt to Actual Valuation 2.34% Property taxes on tangible property, real and personal, are levied by the District, collected and held by the respective County Treasurers, and credited to the General Fund, Special Fund and Bond Fund Accounts of the District. Taxes are levied in September of each year and become due January 1. In the District, in Saline County, the first half of taxes payable become delinquent the following May 1 and the second half on September 1. A-6

23 MAJOR TAXPAYERS IN DISTRICT Taxpayer 2008 Valuation KC Acquisition Inc. $14,500,000 Smithfield Insurance Co. LTD 12,000,000 Burlington Northern Santa Fe Railroad 11,898,106 Nestle Food Co. Nestle Purina Petcare Co 8,520,800 Lauhoff Grain Co. Bunge Milling 8,014,035 DDB Inc., General Investors and B&H Rentals 6,602,220 Omaha Cold Storage 5,729,800 Petersen Development Corp. 5,623,080 Wal-Mart 5,482,660 Source: Saline County Assessor s Office DEBT SERVICE REQUIREMENTS ON GENERAL OBLIGATION BONDS The annual debt service requirements as of January 1 of each year on all outstanding general obligation bonds of the District are shown below. Year Ending Principal Interest Service Total January 1, 2010, January 1, 2011, January 1, 2012, January 1, 2013, January 1, 2014, January 1, 2015, January 1, 2016, January 1, 2017, TOTAL $ A-7

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25 THE DISTRICT FINANCIAL STATEMENTS APPENDIX B

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87 CITY OF CRETE, NEBRASKA - GENERAL INFORMATION APPENDIX C

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89 CITY OF CRETE, NEBRASKA General Crete, a community of approximately 6,302 citizens, is located on the banks of the Big Blue River in the northeast corner of Saline County in southeast Nebraska. Crete is located on Nebraska Highway 33 and Nebraska Highway 103, 24 miles southwest of Lincoln and 84 miles southwest of Omaha. Interstate 80 is 14 miles north of Crete following Highway 103. Population (est) City of Crete 3,546 4,444 4,872 4,841 6,028 6,302 Source: Nebraska Databook Housing Structures There are approximately 2,330 housing units currently located within the City. Selected Income Information Per Capita Income Saline County $20,652 $22,001 $24,263 $23,564 $25,689 $27,695 State of Nebraska 25,569 27,625 28,684 29,162 30,750 32,341 Source: Nebraska Databook Median Family Income (4 Person Family) (est.) Saline County $44,185 $54,900 Source: U.S. Department of Housing and Urban Development, February 2005 Median Family Income (4 Person Family) State of Nebraska $55,681 $55,693 $57,040 $60,626 $60,129 Source: Nebraska Databook C-1

90 Labor Force Figures - Saline County Labor Force 7,111 7,687 8,185 8,377 8,262 Unemployment (110) (191) (239) (266) (278) Employment ,496 7,946 8,111 7,984 Unemployment Rate 1.5% 2.5% 2.9% 3.2% 3.7% For comparative purposes, the State of Nebraska unemployment rate for the years 1998, 2000, 2002, 2004, and 2005 was 2.5%, 2.7%, 3.7%, 3.8%, and 3.8% respectively. Source: Nebraska Databook Largest Taxpayers Taxpayer Type of Business 2006 Valuation % of Total KC Acquisition Inc. Industry $16,285, % Nestle Food Co. Nestle Purina Petcare Co. Industry 13,391, Lauhoff Grain Co. Bunge Milling Industry 12,660, % Burlington Northern Santa Fe Railroads Railroad 10,295, Dorchester Farmers Co-op Commercial 8,807, Peterson Dev. Corp. Industry 7,539, Omaha Cold Storage Commercial 6,256, BNP Paribas Leasing Corp. Industry 6,136, Jane & William Wenz Agricultural 3,726, DDB Inc., Bayne Testamentary Trust & General Investors Commercial 3,488, Major Employers Employer Name Number of Employees Farmland Foods 1,135 Doane College 350 Nestle Food 326 Crete Public Schools 225 Crete Area Medical Center 170 Bunge Milling 159 CJ Cold Storage 115 Crete Manor 110 City of Crete 78 Tabitha Inc. 45 C-2

91 General Obligation Bond Debt The following table sets forth as of April 24, 2007 the entire aggregate principal amount of outstanding general obligation bond debt of the City: Issue Name Dated Date Amount Issued Amount Outstanding General Obligation Various Purpose Bonds, Series 2001 November 15, 2001 $1,320,000 $1,075,000 General Obligation Refunding Bonds, Series 2003 February 10, ,455, ,000 General Obligation Refunding Bonds, Series 2004 March 9, ,770,000 3,105,000 TOTALS: $6,545,000 $5,130,000 Bond Anticipation Note Debt The following table sets forth as of April 24, 2007 the entire aggregate principal amount of outstanding bond anticipation note debt of the City: Issue Name Dated Date Amount Issued Amount Outstanding Bond Anticipation Notes, Series 2006 October 2, 2006 $606,000 $606,000 Revenue Bond Debt The following table sets forth as of April 24, 2007 the entire aggregate principal amount of outstanding revenue bond debt of the City: Issue Name Dated Date Amount Issued Amount Outstanding Combined Revenue Refunding Bonds, Series 2007 April 24, 2007 $3,335,000 1 $3,335,000 Lease-Purchase Obligations The following table sets forth as of April 24, 2007 the entire outstanding aggregate principal amount of the City s lease-purchase obligations: Issue Name Dated Date Amount Issued Amount Outstanding Leasing Corporation Building Bonds, Series 1998 April 1, 1998 $740,000 $355,000 Lease-Purchase Agreement with City Bank & Trust Company October 5, ,400 39,545 1 Preliminary; subject to change. C-3

92 Historical Assessed Valuation The total valuation of all taxable property situated in the City, according to the assessments of January 1 in each of the following years, has been as follows: Year Assessed Valuation Percent Change 1995 $ 112,107, ,959, % ,566,787 (2.71) ,371, ,971, ,911, ,846, ,274, ,028, ,876, ,628, * * * * C-4