$6,970,000 WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) GENERAL OBLIGATION BONDS, SERIES OF 2013

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1 OFFICIAL STATEMENT New Issue Book Entry Bond Rating: Standard & Poor s Ratings Services AA (stable) / BBB+ (negative outlook) underlying BAM Insured (See BOND INSURANCE and CUSIP Base: BOND RATING herein.) In the opinion of Bond Counsel, under existing law as currently enacted and construed and assuming continuing compliance by the School District with certain covenants to comply with the provisions of the Internal Revenue Code of 1986, as amended (the Code ) and applicable regulations thereunder, interest on and accruals of original issue discount with respect to the Bonds are excluded from gross income for federal income tax purposes and are not items of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations such interest and accruals of original Issue discount are taken into account in determining adjusted current earnings for the purpose of the alternative minimum tax. The Bonds are exempt from personal property taxes in Pennsylvania and the interest on the Bonds is exempt from Pennsylvania corporate net income tax and from personal income taxation by the Commonwealth of Pennsylvania or by any of its political subdivisions, under present statutory and case law (see TAX MATTERS herein). The School District has designated the Bonds as qualified tax-exempt obligations for the purposes and effect contemplated by Section 265 of the Code (concerning expenses and interest relating to tax-exempt income of certain financial institutions). $6,970,000 WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) GENERAL OBLIGATION BONDS, SERIES OF 2013 INITIALLY DATED: Date of Delivery INTEREST PAYABLE: April 15 and October 15 PRINCIPAL DUE: April 15, as shown herein FIRST INTEREST PAYMENT DATE: October 15, 2013 PAYMENT OF PRINCIPAL AND INTEREST: The principal of the General Obligation Bonds, Series of 2013, in the aggregate principal amount of $6,970,000 (the Bonds ) will be issued as fully registered bonds and, when issued, the Bonds will be registered in the name of Cede & Co., as registered owner and nominee for The Depository Trust Company ( DTC ), New York, New York. So long as Cede & Co. is the registered owner, reference herein to the registered owner of Bonds shall mean Cede & Co., and not the Beneficial Owners (as defined herein). DTC will act as securities depository of the Bonds, and purchases of beneficial ownership interests in the Bonds will be made in book-entry form only, in denominations of $5,000 or integral multiples thereof. Beneficial Owners will not receive certificates representing their interest in the Bonds. (See BOOK-ENTRY ONLY SYSTEM herein). Interest on the Bonds is payable initially on October 15, 2013 and semiannually thereafter on April 15 and October 15 of each year until the principal sum thereof is paid. Principal of, and premium, if any, on the Bonds will be paid by Wells Fargo Bank, N.A., Philadelphia, Pennsylvania (the Paying Agent ). So long as Cede & Co. is the registered owner, the Paying Agent will pay principal of, and interest on the Bonds to DTC, which will remit such principal and interest to its Direct or Indirect Participants (as defined herein), which will in turn remit such principal and interest to the Beneficial Owners of the Bonds, as more fully described herein. (See BOOK-ENTRY ONLY SYSTEM herein.) The Bonds are subject to redemption prior to their stated maturities, as more fully described herein. (See "REDEMPTION OF BONDS" herein.) SECURITY FOR THE BONDS: The Bonds are general obligations of West Mifflin Area School District, Allegheny County, Pennsylvania (the "School District"), payable from its taxes and other available revenues which presently include available ad valorem taxes which may be levied on all taxable real property within the School District for the payment when due of the principal of and the interest on the Bonds. (See "INTRODUCTORY STATEMENT" herein.) The School District has covenanted that it will provide in its budget in each year, and will duly and punctually pay or cause to be paid from the sinking fund established under the Resolution (as defined below) of the School District pursuant to which the Bonds are issued, or from any other of its available revenues or funds, the principal of and the interest on every Bond on the dates and at the place and in the manner stated in the Bonds. For such budgeting, appropriation and payment, the School District irrevocably has pledged its full faith, credit and available taxing power. (See COMPREHENSIVE LIMITATION ON TAXING POWERS UNDER THE TAXPAYER RELIEF ACT) ). CREDIT ENHANCEMENT: The scheduled payment of principal of and interest on the Bonds when due will be guaranteed under a municipal bond insurance policy to be issued concurrently with the delivery of the Bonds by Build America Mutual Assurance Company ( BAM ). AUTHORIZATION FOR ISSUANCE: The Bonds are being issued in accordance with the Local Government Unit Debt Act of the Commonwealth of Pennsylvania, Act of December 19, 1996, P.L. 1158, No. 177, 53 Pa. C.S to 8271 (the "Act"), with the approval of the Pennsylvania Department of Community and Economic Development, and pursuant to a Resolution duly adopted by the Board of School Directors of the School District on February 25, 2013 (the "Resolution"). CONTINUING DISCLOSURE UNDERTAKING: The School District has agreed to provide, or cause to be provided, in a timely manner, certain information in accordance with the requirements of Rule 15c2-12, as promulgated under the Securities and Exchange Act of 1934, as amended and interpreted (the "Rule"). (See "CONTINUING DISCLOSURE UNDERTAKING" herein.) LEGAL APPROVALS: The Bonds are offered when, as and if issued by the School District and received by the Underwriter, subject to prior sale and subject to the receipt of the approving legal opinion to be issued by Grogan Graffam, P.C., Pittsburgh, PA, Bond Counsel. Certain additional matters will be passed upon for the School District by its Counsel, George S. Gobel, Esq., McKeesport, Pennsylvania, Solicitor to the School District. The Bonds are expected to be available for delivery March 28, 2013 (the Date of Delivery ) in New York, New York. REGISTRATION OF BONDS: Information concerning the Bonds has been furnished to The Depository Trust Company, New York, New York ("DTC"). It is expected that the Bonds will be book-entry only. The date of this Official Statement is February 26,

2 $6,970,000 WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) GENERAL OBLIGATION BONDS, SERIES OF 2013 INITIALLY DATED: Date of Delivery INTEREST PAYABLE: April 15 and October 15 PRINCIPAL DUE: April 15, as shown herein FIRST INTEREST PAYMENT DATE: October 15, 2013 BOND MATURITY SCHEDULE Year Principal Interest CUSIP (April 15) Amount Rate Yield Price (1) Numbers (2) 2018 $ 25, % 1.750% % SB $ 25, % 3.050% % SC $ 25, % 3.510% % SD $ 20, % 3.700% % SE ,160, % 3.730% % RZ ,715, % 3.790% % SA0 (1) Based on settlement date of March 28, (2) The above CUSIP (Committee on Uniform Securities Identification Procedures) numbers have been assigned by an organization not affiliated with the School District or the Underwriter, and such parties are not responsible for the selection or use of the CUSIP numbers. The CUSIP numbers are included solely for the convenience of bondholders and no representation is made as to the correctness of such CUSIP numbers. CUSIP numbers assigned to securities may be changed during the term of such securities based on a number of factors including, but not limited to, the refunding or defeasance of such issue or the use of secondary market financial products. Neither the School District nor the Underwriter has agreed to, and there is no duty or obligation to, update this Official Statement to reflect any change or correction in the CUSIP numbers set forth above. Build America Mutual Assurance Company ( BAM ) makes no representation regarding the Bonds or the advisability of investing in the Bonds. In addition, BAM has not independently verified, makes no representation regarding, and does not accept any responsibility for the accuracy or completeness of this Official Statement or any information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the information regarding BAM, supplied by BAM and presented under the heading Bond Insurance and Appencix C - Specimen Municipal Bond Insurance Policy.

3 SUMMARY STATEMENT This Summary Statement is subject in all respects to more complete information contained in this Official Statement. No person is authorized to detach this SUMMARY STATEMENT from this Official Statement or otherwise use it without the entire Official Statement. Issuer... West Mifflin Area School District, Allegheny County, Pennsylvania. The Bonds... $6,970,000 aggregate principal amount of General Obligation Bonds, Series of 2013, (the Bonds ). The Bonds are initially dated the Date of Delivery, and will mature as shown in the BOND MATURITY SCHEDULE shown on the inside of the Cover Page of this Official Statement. Interest on the Bonds will begin to accrue on the Date of Delivery, and is payable each April 15 and October 15 thereafter, commencing October 15, (See THE BONDS herein.) Redemption Provisions... The Bonds are subject to mandatory and optional redemption prior to their stated dates of maturity, as more fully described herein. (See REDEMPTION OF BONDS herein.) Form of Bonds... Book-entry only. Application of Proceeds... The proceeds to be derived by the School District from the issuance and sale of the Bonds will be used to provide the School District with the funds required for: (1) refunding, on a current refunding basis, the School District s General Obligation Notes, Series B of 2011, currently outstanding in the aggregate principal amount of $3,570,000; (2) various capital improvements within the School District; and (3) paying all costs and expenses incurred by the School District in connection with the issuance and sale of the Bonds. (See PURPOSE OF THE BOND ISSUE, THE REFUNDING PROGRAM, SOURCES AND USES OF FUNDS, WEST MIFFLIN AREA SCHOOL DISTRICT - School Building Facilities, DEBT LIMITS AND REMAINING BORROWING CAPACITY OF THE SCHOOL DISTRICT - Future Financing, SCHEDULE OF DIRECT AND OVERLAPPING DEBT AND DEBT RATIOS, and SCHEDULE OF DEBT SERVICE OBLIGATIONS herein.) Security for the Bonds... The Bonds are general obligations of the School District, for the payment of which the School District has irrevocably pledged its full faith, credit and available taxing power. (See COMPREHENSIVE LIMITATION ON TAXING POWERS UNDER THE TAXPAYER RELIEF ACT herein.) Credit Enhancement... The scheduled payment of principal of and interest on the Bonds when due will be guaranteed under an insurance policy to be issued concurrently with the delivery of the Bonds by Build America Mutual Insurance Company ( BAM ). (See BOND INSURANCE herein). Bond Rating... The Bonds are expected to receive a credit rating of AA (stable) from Standard and Poor s Ratings Services, New York, New York ( S&P ), with the understanding that the above-described municipal bond insurance policy will be issued at the time of settlement of the Bonds. Moody s has also assigned its underlying rating of BBB+ (negative outlook) to the Bonds. (See BOND RATING herein.) Continuing Disclosure Undertaking... The School District has agreed to provide, or cause to be provided, in a timely manner, certain information in accordance with the requirements of Rule 15c2-12, as promulgated under the Securities and Exchange Act of 1934, as amended and interpreted (the Rule ). (See CONTINUING DISCLOSURE UNDERTAKING herein.).

4 WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) Administrative Offices 3000 Lebanon Church Road, Suite 300 West Mifflin, Pennsylvania Telephone: (412) Fax: (412) BOARD OF SCHOOL DIRECTORS Mr. Phil Shar... Mr. Nicholas Alexandroff... Mrs. Judy Andzelik... Mr. Ted Cale... Mr. Richard Crux... Mr. Harry Fast III... Mr. Daniel McDonald... Mr. Michael Price... Mr. Ron Rubinsak... President Vice President Member Member Member Member Member Member Member CENTRAL ADMINISTRATION Dr. Daniel Castagna... Dr. Mark Hoover... Mr. Dennis Cmar... Superintendent of Schools Assistant Superintendent of Schools Business Manager/Board Secretary SOLICITOR George S. Gobel, Esq. McKeesport, Pennsylvania BOND COUNSEL Grogan Graffam, P.C. Pittsburgh, Pennsylvania INDEPENDENT AUDITOR Lawson & Company Certified Public Accountants Pittsburgh, Pennsylvania PAYING AGENT, ESCROW AGENT AND SINKING FUND DEPOSITARY Wells Fargo Bank, N.A. Philadelphia, Pennsylvania MANAGING UNDERWRITER Janney Montgomery Scott LLC Pittsburgh, Pennsylvania

5 No dealer, broker or any other person has been authorized by the School District to give any information or make any representation, other than those contained in this Official Statement, and if given or made, such other information and representation must not be relied upon. This Official Statement does not constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of the Bonds in any jurisdiction in which it is unlawful to make such offer, solicitation or sale. The information set forth herein has been obtained from the School District and from other sources which are believed to be reliable, but the School District does not guarantee the accuracy or completeness of information from sources other than the School District. No representation is made by Janney Montgomery Scott LLC, Pittsburgh, Pennsylvania, as the Managing Underwriter (the "Managing Underwriter"), as to the accuracy or completeness of the information obtained from either the School District or from sources other than the School District. The information and expressions of opinion 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 any of the information set forth herein since the date hereof. IN CONNECTION WITH THE OFFERING OF THE BONDS, THE MANAGING UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE BONDS HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR HAS THE RESOLUTION BEEN QUALIFIED UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, IN RELIANCE UPON EXEMPTIONS CONTAINED IN SUCH ACTS. THE REGISTRATION OR QUALIFICATION OF THE BONDS OR THE RESOLUTION IN ACCORDANCE WITH APPLICABLE PROVISIONS OF THE SECURITIES LAWS OF CERTAIN STATES, IF ANY, IN WHICH THE BONDS HAVE BEEN REGISTERED OR QUALIFIED AND THE EXEMPTION FROM REGISTRATION OR QUALIFICATION IN CERTAIN OTHER STATES CANNOT BE REGARDED AS A RECOMMENDATION THEREOF. NEITHER THESE STATES NOR ANY OF THEIR AGENCIES HAVE PASSED UPON THE MERITS OF THE BONDS OR THE ACCURACY OR COMPLETENESS OF THIS OFFICIAL STATEMENT. ANY REPRESENTATION TO THE CONTRARY MAY BE A CRIMINAL OFFENSE. The School District has previously provided the Underwriter with a copy of its Preliminary Official Statement, dated February 19, As of its date, the Preliminary Official Statement was deemed final for the purposes of SEC Rule 15c2-12(b)(1). The School District deems this Official Statement to be final for the purpose of SEC Rule 15c2-12(b)(3). TABLE OF CONTENTS Item Page Introductory Statement... 1 The Bonds... 1 Book-Entry Only System... 2 Redemption of Bonds... 3 Security for the Bonds... 4 Bond Insurance... 6 Purpose of the Bond Issue... 7 The Refunding Program... 7 Sources and Uses of Funds... 8 West Mifflin Area School District... 8 Debt Limits and Remaining Borrowing Capacity of the School District Schedule of Direct and Overlapping Debt and Debt Ratios History of Tax Anticipation Bond Financing Schedule of Debt Service Obligations Summary of Significant Accounting Policies of the School District Summary Statement of Fund Balance Trends - - General Fund Summary Statement of Assets, Liabilities, and Fund Equity - - General Fund Taxes and Taxing Powers of the School District Comprehensive Limitation on Taxing Power Under the Taxpayer Relief Act Additional Limitations Real Property Values Trend The Paying Agent Continuing Disclosure Undertaking Litigation Statement Legal Opinions Tax Matters Bond Rating Bond Underwriting Miscellaneous Matters Appendix A - Demographic and Economic Description of West Mifflin Area School District... A-1 Appendix B - Form of Opinion of Bond Counsel... B-1 Appendix C - Specimen Municipal Bond Insurance Policy... C-1 This Table of Contents does not list all of the subjects in this Official Statement. In all instances, reference should be made to the complete Official Statement to determine the subjects set forth herein.

6 OFFICIAL STATEMENT $6,970,000 WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) GENERAL OBLIGATION BONDS, SERIES OF 2013 INTRODUCTORY STATEMENT This Official Statement, including the Cover Page hereof and the Appendices hereto, is furnished in connection with the offering by the West Mifflin Area School District (the School District ), of $6,970,000 aggregate principal amount of General Obligation Bonds, Series of 2013 (the Bonds ). The Bonds are authorized to be issued pursuant to the provisions of the Pennsylvania Local Government Unit Debt Act, Act of December 19, 1996, P.L. 1158, No. 177, 53 Pa. C.S to 8271 (the Act ) and are described in, and are being issued pursuant to the provisions of, a Resolution of the Board of School Directors of the School District duly adopted on February 25, The approval of the Department of Community and Economic Development of the Commonwealth of Pennsylvania (the Commonwealth ), for the School District to issue and deliver the Bonds will have been duly given pursuant to the Act; all acts, conditions and things required by the laws of the Commonwealth to exist, to have happened or to have been performed precedent to or in the issuance of the Bonds or in the creation of the debt of which any Bond is evidence, exist, will have happened, and will have been performed in regular and due form and manner as required by law; the Bonds, together with all other indebtedness of the School District, will be within every debt and other limit prescribed by the Constitution and the statutes of the Commonwealth; and the School District will have established with Wells Fargo Bank, N.A., Philadelphia, Pennsylvania, (the Paying Agent ) or its designee, as the paying agent, transfer agent, bond registrar, and sinking fund depositary for the Bonds, a Sinking Fund for the Bonds, as defined herein, and shall deposit therein amounts sufficient to pay the principal of and interest on the Bonds as the same shall become due and payable. (See THE PAYING AGENT herein.) The Bonds, as General Obligation Bonds of the School District, are secured, for the prompt payment when due of the principal of, redemption premium, if any, and the interest on the Bonds, by a pledge of the full faith, credit, and available taxing power of the School District. (See SECURITY FOR THE BONDS and COMPREHENSIVE LIMITATION ON TAXING POWERS UNDER THE TAXPAYER RELIEF ACT herein.) The Pennsylvania Public School Code of 1949, as amended (the "School Code"), presently provides for withholding and direct application of subsidies from the Commonwealth to a school district in the event of a failure by the school district to pay when due the principal of and the interest on its bonded indebtedness. (See SECURITY FOR THE BONDS - Commonwealth Enforcement of Debt Service Payments herein.) The proceeds to be derived by the School District from the issuance and sale of the Bonds will be used to provide the School District with the funds required for: (1) refunding, on a current refunding basis, the School District s General Obligation Notes, Series B of 2011, currently outstanding in the aggregate principal amount of $3,570,000; (2) various capital improvements within the School District; and (3) paying all costs and expenses incurred by the School District in connection with the issuance and sale of the Bonds. (See PURPOSE OF THE BOND ISSUE, THE REFUNDING PROGRAM, SOURCES AND USES OF FUNDS, WEST MIFFLIN AREA SCHOOL DISTRICT - School Building Facilities, DEBT LIMITS AND REMAINING BORROWING CAPACITY OF THE SCHOOL DISTRICT - Future Financing, SCHEDULE OF DIRECT AND OVERLAPPING DEBT AND DEBT RATIOS, and SCHEDULE OF DEBT SERVICE OBLIGATIONS herein.) The scheduled payment of the principal of and the interest on the Bonds when due will be guaranteed under an insurance policy to be issued concurrently with the delivery of the Bonds by Build America Mutual Assurance Company ( BAM ). (See BOND INSURANCE herein.) Description; Payment of Principal and Interest THE BONDS The aggregate principal amount of the Bonds is $6,970,000. The Bonds are dated the Date of Delivery, and will bear interest at the rates per annum, and will mature in the amounts and on the dates listed in the BOND MATURITY SCHEDULE shown on the inside of the Cover Page of this Official Statement. Interest is payable initially on October 15, 2013 and thereafter semiannually on April 15 and October 15 of each year ("Interest Payment Dates"), until the principal amount thereof is paid. Principal of the Bonds will be paid to the registered owners thereof or assigns, when due, upon surrender of the Bonds at the designated corporate trust office of the Paying Agent. 1

7 Interest is payable to the registered owner of a Bond from the interest payment date next preceding the date of registration and authentication of the Bond unless: (a) such Bond is registered and authenticated as of an interest payment date, in which event such Bond shall bear interest from said interest payment date, or (b) such Bond is registered and authenticated after a Record Date (hereinafter defined) and before the next succeeding interest payment date, in which event such Bond shall bear interest from such interest payment date, or (c) such Bond is registered and authenticated on or prior to the Record Date preceding the Date of Delivery, in which event such Bond shall bear interest from the Date of Delivery, or (d) as shown by the records of the Paying Agent, interest on such Bond shall be in default, in which event such Bonds shall bear interest from the date on which interest was last paid on such Bond. Interest shall be paid initially on October 15, 2013, and thereafter, semiannually on April 15 and October 15 of each year, until the principal sum is paid. Interest on each Bond is payable by check drawn on the Paying Agent, which shall be mailed to the registered owner whose name and address shall appear, at the close of business on the last day of the month (whether or not a day on which the Paying Agent is open for business) next preceding each interest payment date (the "Record Date"), on the registration books maintained by the Paying Agent, irrespective of any transfer or exchange of the Bond subsequent to such Record Date and prior to such interest payment date, unless the School District shall be in default in payment of interest due on such interest payment date. In the event of any such default, such defaulted interest shall be payable to the person in whose name the Bond is registered at the close of business on a special record date for the payment of such defaulted interest established by notice mailed by the Paying Agent to the registered owners of such Bonds not less than fifteen days preceding such special record date. Such notice shall be mailed to the persons in whose names such Bonds are registered at the close of business on the fifth day preceding the date of mailing. If the date for payment of the principal of or interest on any Bonds shall be a Saturday, Sunday, legal holiday, or a day on which banking institutions in the Commonwealth are authorized by law or executive order to close, then the date for payment of such principal or interest shall be the next succeeding day which is not a Saturday, Sunday, legal holiday, or a day on which such banking institutions are authorized to close, and payment on such date shall have the same force and effect as if made on the nominal date established for such payment. BOOK-ENTRY ONLY SYSTEM The Depository Trust Company ( DTC ), New York, NY, will act as securities depository for the securities (the Securities ). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fullyregistered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. DTC, the world s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a banking organization within the meaning of the New York Banking Law, a member of the Federal Reserve System, a clearing corporation within the meaning of the New York Uniform Commercial Code, and a clearing agency registered pursuant to the provisions of Section 17A of the Securities Exchange Act of DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-u.s. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC s participants ( Direct Participants ) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ( DTCC ). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has a Standard & Poor s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC s records. The ownership interest of each actual purchaser of each Security ( Beneficial Owner ) is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not affect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC s records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may 2

8 or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co. s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC s practice is to credit Direct Participants accounts upon DTC s receipt of funds and corresponding detail information from Issuer or Agent, on payable date in accordance with their respective holdings shown on DTC s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in street name, and will be the responsibility of such Participant and not of DTC, Agent, or Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of Issuer or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant, to Agent, and shall effect delivery of such Securities by causing the Direct Participant to transfer the Participant s interest in the Securities, on DTC s records, to Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC s records and followed by a book-entry credit of tendered Securities to Agent s DTC account. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered. Issuer may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC. The information in this section concerning DTC and DTC s book-entry system has been obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy thereof. Notice of Redemption REDEMPTION OF BONDS When required or directed to redeem Bonds, the Paying Agent shall cause notice of the redemption to be given by first-class mail, postage pre-paid, not more than sixty (60) days and not less than thirty (30) days prior to the date fixed for redemption to all registered holders of Bonds to be redeemed at their registered addresses prior to the redemption date. Any such notice shall be given in the name of the School District, shall identify the Bonds to be redeemed (and, in the case of a partial redemption of any Bonds, the respective principal amounts thereof to be redeemed), shall specify the redemption date and the redemption price and shall state that on the redemption date the Bonds called for redemption will be payable at a designated office of the Paying Agent or its designee and that from that date interest will cease to accrue on the Bonds or portions thereof to be redeemed. Failure to mail any notice or any defect in the mailed notice or in the mailing thereof shall not affect the validity of the proceedings for the redemption of Bonds with respect to which no such failure or defect occurred. The Paying Agent may use CUSIP numbers in notices of redemption as a convenience to holders of the Bonds, provided that such notice shall state that no representation is made as to the correctness of such numbers either as printed on the Bonds or as contained in any notice of redemption and that reliance may be placed only on the serial numbers of the Bonds. 3

9 If the date for the payment of the principal of, interest on, or redemption premium, if any, on any of the Bonds shall be a Saturday, Sunday, legal holiday, or a day on which banking institutions in the municipality where the principal corporate trust office of the Paying Agent or its designee is located are authorized by law or executive order to close, then the date for payment of the principal, redemption premium, if any, and interest shall be the next succeeding day which is not a Saturday, Sunday, legal holiday, or a day on which such banking institutions in the Commonwealth are authorized to close, and payment on such date shall have the same force and affect as if made on the nominal date of payment. Manner of Redemption Portions of any Bond of a denomination larger than $5,000 may be redeemed, but only in the principal amount of $5,000 or any integral multiple thereof. For the purpose of redemption, each Bond shall be treated as representing the number of Bonds that is equal to the principal amount thereof divided by $5,000, each $5,000 portion of such Bond being subject to redemption. Upon surrender of any Bond for redemption of a portion only, the Paying Agent shall authenticate and deliver to the owner thereof a new Bond or Bonds of the same series, maturity date and interest rate, in authorized denominations in an aggregate principal amount equal to the unredeemed portion of the Bond surrendered. Mandatory Redemption In the manner and upon the terms and conditions provided in the Resolution, the Bonds stated to mature on April 15 of the years 2018, 2023, 2028 and 2032 are subject to mandatory redemption, in part, prior to maturity, by lot within a maturity, at a redemption price equal to 100% of the principal amount thereof, together with accrued interest thereon, to the dates fixed for redemption, on April 15, of the years and in the amounts set forth below: The Bonds Stated to Mature The Bonds Stated to Mature on April 15, 2018 on April 15, 2023 Year Principal Amount Year Principal Amount 2014 $ 5, $ 5, , , , , , , ,000* ,000* The Bonds Stated to Mature The Bonds Stated to Mature on April 15, 2028 on April 15, 2032 Year Principal Amount Year Principal Amount 2024 $ 5, $ 5, , , , , , ,000* ,000* *By Maturity Optional Redemption In the manner and upon the terms and conditions provided in the Resolution, the Bonds stated to mature on and after April 15, 2019 are subject to redemption prior to maturity at the option of the School District in any order of maturities either as a whole, or in part, at any time on or after April 15, 2018, and, if in part, by lot within a maturity, at a redemption price equal to 100% of the principal amount thereof, together with accrued interest to the date fixed for redemption. General SECURITY FOR THE BONDS The School District has covenanted that it will provide in its budget for each year, and will appropriate from its revenues in each such year, the amount of the debt service on the Bonds for such year, and will duly and punctually pay or cause to be paid from its Sinking Fund, or any other of its available revenues or funds, the principal of, redemption premium, if any, and the interest on the Bonds, as and when due, at the dates and places and in the manner stated on the Bonds. For such budgeting, appropriation, and payment, the School District has irrevocably pledged its full faith, credit and available taxing power. Such pledge is specifically enforceable but is subject to the limitations of bankruptcy, insolvency, and other laws or equitable principles affecting creditor rights generally. Additionally, the School Code presently provides for withholding and direct application of Commonwealth subsidies in the event of failure of a school district to pay debt service on its bonded indebtedness. (See Commonwealth Enforcement of Debt Service Payments herein.) 4

10 No recourse shall be had for the payment of the principal of or the interest on any Bond, or for any claim based thereon or in the Resolution against any member of the Board of School Directors, or any officer or employee of the School District, past, present, or future or of any successor body, as such, either directly or through the School District or any such successor body, under any constitutional provision, statute or rule of law, or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, and all such liability of such members of the Board of School Directors, officers, or employees is released as a condition of and as consideration for the issuance of the Bonds. Bondholder Rights and Remedies The remedies available to holders of the Bonds upon any failure to pay the principal of, redemption premium, if any, and the interest on the Bonds, when due, include those prescribed by the Act. If such failure should continue for a period of time in excess of thirty days, any holder of the Bonds will, subject to certain priorities, have the right to bring suit for the amount due in the Court of Common Pleas of Allegheny County, Pennsylvania. The Act provides that, if the School District defaults in the payment of the principal of, redemption premium, if any, and the interest on the Bonds, and such default continues for a period of time in excess of thirty days, or if the School District fails to comply with any provision of either the Bonds or the Resolution, then the holders of 25% in aggregate principal amount of the Bonds may appoint a trustee to represent the holders of the Bonds. Such trustee may, and upon written request of the holders of 25% in aggregate principal amount of the Bonds and being furnished with satisfactory indemnity, must take one or more of the following actions, which will preclude similar action by individual holders: (i) bring suit to enforce all rights of the holders, (ii) bring suit on the Bonds, (iii) petition the Court to levy the amount due plus estimated costs of collection as an assessment upon all taxable real estate and other property subject to ad valorem taxation in the School District (any such assessment will have the same priority and preference as to other liens or security interests as a lien for unpaid taxes), and (iv) by suit in equity, enjoin any acts or things which may be unlawful or in violation of the rights of the holders, all as set forth more fully in the Act. Enforcement of a claim for payment of the principal of, premium, if any or the interest on the Bonds may be subject to the provisions of the federal bankruptcy laws and to the provisions of other statutory laws enacted by the Congress or the General Assembly of the Commonwealth, or common law developed by competent courts having jurisdiction extending the time for payment or imposing other constraints upon enforcement insofar as such laws may be constitutionally applied. Commonwealth Enforcement of Debt Service Payments Section 633 of the School Code, presently provides that in all cases where the board of school directors of any school district fails to pay or to provide for the payment of any indebtedness at date of maturity or date of mandatory redemption, or any interest due on such indebtedness on any interest payment date, in accordance with the schedule under which the bonds are issued, the Secretary of Education shall notify such board of school directors of its obligation and shall withhold out of any Commonwealth appropriation due such school district an amount equal to the sum of the principal amount maturing or subject to mandatory redemption and interest owing by such school district, and shall pay over the amount so withheld to the bank or other person acting as sinking fund depositary for such bond issue. These withholding provisions are not part of any contract with the holders of the Bonds, and may be amended or repealed by future legislation. There can be no assurance that any payments made pursuant to this withholding provision will be made by the date on which such payments are due to Bondholders, and the effectiveness of the withholding provisions of Section 633 may be limited by the application of other withholding provisions contained in the School Code. These provisions may apply to withholding and paying over appropriations for payment of unpaid teachers' salaries. Enforcement may also be limited by bankruptcy, insolvency, or other laws or equitable principles affecting the rights of creditors. Commonwealth Aid to School Districts Under the Constitution of the Commonwealth, the Commonwealth is charged with the duty of supporting and maintaining a thorough and efficient public school system. As one means of fulfilling this mandate, the General Assembly of the Commonwealth has rendered basic instructional financial assistance to school districts by means of periodic formulaic subsidies intended to reimburse a portion of the previous years costs of operation. The General Assembly has also provided partial reimbursement for sinking fund payments made by school districts and lease rental payments made to a municipal authority in support of school building projects approved by the Department of Education of the Commonwealth on a current fiscal year basis. Commonwealth reimbursement is based on the Reimbursable Percentage of a school building project and the greater of the school district's Market Value Aid Ratio ( MVAR ) or it s Permanent Capital Account Reimbursement Fraction ( CARF ). The product of these two factors is the percentage of the annual debt service payments made on bonded indebtedness which will be reimbursed by the Commonwealth. The "Reimbursable Percentage" is based upon various components and formulaic costs of the project and will be determined by the Department of Education of the Commonwealth (the "Department"). The MVAR is a function of 5

11 the market value of real estate within a school district per "weighted average daily membership" of the school district relative to that of all other school districts in the Commonwealth. The following table reflects both the funds which have been received by the School District from the Commonwealth with respect to lease rental and debt service subsidy payments and the amounts of debt service and lease rental payments made by the School District: Total Payment by % Reimbursed by Fiscal Year Ending June 30, Subsidy the School District (1) the Commonwealth 2008 $ 906,367 $ 3,949, % ,984 4,520, % ,616 5,917, % ,757 4,108, % ,271 4,712, % 2013 (Budgeted) 679,420 6,449, % Average $ 632,069 $ 4,943, % (1) Includes debt service and lease rental payments eligible for subsidy payments from the Commonwealth. BOND INSURANCE POLICY BOND INSURANCE Concurrently with the issuance of the Bonds, Build America Mutual Assurance Company ( BAM ) will issue its Municipal Bond Insurance Policy for the Bonds (the Policy ). The Policy guarantees the scheduled payment of principal of and interest on the Bonds when due as set forth in the form of the Policy included as Appendix C to this Official Statement. The Policy is not covered by any insurance security or guaranty fund established under New York, California, Connecticut or Florida insurance law. BUILD AMERICA MUTUAL ASSURANCE COMPANY BAM is a New York domiciled mutual insurance corporation. BAM provides credit enhancement products solely to issuers in the U.S. public finance markets. BAM will only insure obligations of states, political subdivisions, integral parts of states or political subdivisions or entities otherwise eligible for the exclusion of income under section 115 of the U.S. Internal Revenue Code of 1986, as amended. No member of BAM is liable for the obligations of BAM. The address of the principal executive offices of BAM is: 1 World Financial Center, 27 th Floor, 200 Liberty Street, New York, New York 10281; its telephone number is: , and its website is located at: BAM is licensed and subject to regulation as a financial guaranty insurance corporation under the laws of the State of New York and in particular Articles 41 and 69 of the New York Insurance Law. BAM s financial strength is rated AA/Stable by Standard and Poor s Ratings Services, a Standard & Poor s Financial Services LLC business ( S&P ). An explanation of the significance of the rating and current reports may be obtained from S&P at The rating of BAM should be evaluated independently. The rating reflects the S&P s current assessment of the creditworthiness of BAM and its ability to pay claims on its policies of insurance. The above rating is not a recommendation to buy, sell or hold the Bonds, and such rating is subject to revision or withdrawal at any time by S&P, including withdrawal initiated at the request of BAM in its sole discretion. Any downward revision or withdrawal of the above rating may have an adverse effect on the market price of the Bonds. BAM only guarantees scheduled principal and scheduled interest payments payable by the issuer of the Bonds on the date(s) when such amounts were initially scheduled to become due and payable (subject to and in accordance with the terms of the Policy), and BAM does not guarantee the market price or liquidity of the Bonds, nor does it guarantee that the rating on the Bonds will not be revised or withdrawn. Capitalization of BAM On July 18, 2012, in connection with the receipt of its license under the New York insurance law and the commencement of its operations, the New York State Department of Financial Services examined BAM. The Report on Organization of the Build America Mutual Assurance Company as of July 18, 2012 is available on BAM s website and is incorporated by reference. 6

12 The following table sets forth the capitalization of BAM on the basis of statutory accounting practices prescribed or permitted by the New York State Department of Financial Services as of September 30, Statutory Accounting Principles September 30, 2012 (in thousands) (unaudited) Total net admitted assets... $518,880 Total liabilities... $27,905 Total surplus as regards policyholders $490,975 BAM has obtained reinsurance coverage, initially in the amount of $100 million, that will provide first loss protection up to a maximum of 15% of the par amount outstanding for each policy issued by BAM, subject to certain limitations and restrictions. BAM s most recent unaudited interim financial statements, prepared in accordance with accounting principles prescribed or permitted by the New York State Insurance Department, which are incorporated herein by reference, are available on BAM s website at and may be obtained, without charge, upon request to BAM at its address provided above (Attention: Finance Department). BAM s audited annual financial statements will similarly be made available when published. BAM makes no representation regarding the Bonds or the advisability of investing in the Bonds. In addition, BAM has not independently verified, makes no representation regarding, and does not accept any responsibility for the accuracy or completeness of this Official Statement or any information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the information regarding BAM, supplied by BAM and presented under the heading BOND INSURANCE. PURPOSE OF THE BOND ISSUE The proceeds to be derived by the School District from the issuance and sale of the Bonds will be used to provide the School District with the funds for: (1) refunding, on a current refunding basis, the School District s General Obligation Notes, Series B of 2011, currently outstanding in the aggregate principal amount of $3,570,000; (2) various capital improvements within the School District; and (3) paying all costs and expenses incurred by the School District in connection with the issuance and sale of the Bonds. THE REFUNDING PROGRAM A portion of the net proceeds of the Bonds will be deposited with Wells Fargo Bank, N.A., as Paying Agent (the 2011B Paying Agent ), for the Series B of 2011 Notes. The moneys so deposited will be applied by the 2011B Paying Agent to redeem on March 28, 2013, the Series B of 2011 Notes to be refunded by paying 100% of the principal amount thereof plus accrued interest to the redemption date (there being no premium payable upon the redemption thereof). 7

13 SOURCES AND USES OF FUNDS The proceeds from the sale of the Bonds shall be applied substantially in the following manner: Sources of Funds: The Bonds $ 6,970, Net original issue discount (1) (199,987.00) Total Sources of Funds $ 6,770, Uses of Funds: Deposit to the Sinking Fund (2011B) $ 3,595, Proceeds to School District 3,002, Issuance costs - legal, paying agent, insurance premium, printing, rating fee, bond discount, advertising, filing, CUSIP numbers and miscellaneous expenses 172, Total Uses of Funds $ 6,770, (1) See TAX MATTERS Original Issue Discount herein. Introduction WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) The School District is comprised of the Boroughs of West Mifflin and Whitaker (collectively, the Component Municipalities ). The two Component Municipalities of the School District are located in the southcentral portion of Allegheny County, Pennsylvania (the County ), approximately ten miles south of the City of Pittsburgh, the county seat of the County. The School District is bordered to the north by the City of Pittsburgh, to the south by the Boroughs of Jefferson and Pleasant Hills, to the east by the City of Duquesne, and to the west by the Borough of Baldwin. The School District encompasses a combined land area of 14.5 square miles, serving a 2010 U.S. Census population of 21,584. Organization and Central Administration The School District is a third class school district (school districts within the Commonwealth are classified as first, second, third and fourth class according to population) and operates under and pursuant to the Code, as amended and supplemented. The School District is governed by a nine member Board of School Directors, comprised of residents of the School District who are elected at large for four-year terms of office. The daily operations and management of the School District are overseen by the Superintendent of Schools, who serves as the chief educational and financial officer of the School District. The Superintendent is assisted by the following central office administrative and supervisory staff: Assistant Superintendent of Schools; Coordinator of Pupil Personnel Services/Federal Programs; and Business Manager/Board Secretary. The current enrollment of the School District is 3,063, and the School District currently operates three elementary and two secondary school building facilities. (See School Building Facilities herein). The budget for the fiscal year ending June 30, 2013, is $45,006,192, which includes a Fund Balance of $445,829. The total employment of the School District is currently comprised of administrative, professional/instructional and classified support personnel. For a complete description of the economic and demographic characteristics of the School District, reference is hereby made to Appendix A of this Official Statement. SOURCE: School District Administrative Officials. 8

14 Comparative Population Trends The following table depicts the comparative population trends of the Component Municipalities, the County, and the Commonwealth. Percentage Political 1970 U.S U.S U.S U.S U.S. of Change Subdivision Census Census Census Census Census West Mifflin Borough 28,070 26,279 23,644 22,464 20, % Whitaker Borough 1,797 1,615 1,416 1,338 1, % Total 29,867 27,894 25,060 23,802 21, % Allegheny County 1,605,133 1,450,095 1,336,449 1,281,666 1,223, % Commonwealth of Pennsylvania 11,800,766 11,864,720 11,881,643 12,052,410 12,702, % SOURCES: U.S. Census Data and The Pennsylvania State University Data Center School Building Facilities The School District is currently organized on the following grade level structure: K-3, 4-8 and The following table depicts the component elements of the existing physical plant of the School District. Year(s) of Original Additions/ Grades Rated Current Construction Renovations Housed Capacity Enrollment Elementary: Clara Barton K Homeville ; 1953; 1993 K New Emerson K Secondary: West Mifflin Area Middle School ,278 1,082 West Mifflin Area High School ,200 1,137 SOURCE: School District Administrative Officials. Total... 3,803 3,063 9

15 Enrollment History and Projections The past, present and projected enrollment data of the School District is shown below. School Year Ending June 30, K Total ,563 1,633 3, ,554 1,703 3, ,508 1,716 3, ,487 1,657 3, ,462 1,587 3, (1) 1,431 1,533 2, (1) 1,433 1,515 2, (1) 1,414 1,472 2, (1) 1,396 1,425 2, (1) 1,377 1,411 2, (1) 1,363 1,387 2, (1) 1,341 1,361 2, (1) 1,332 1,305 2, (1) 1,279 1,314 2, (1) 1,246 1,310 2,556 (1) Projected. SOURCE: Pennsylvania Department of Education. Employment The School District currently employs approximately persons, as shown below. Administration/Supervisory 16 Professional/Instructional Custodial, Maintenance, and Support 115 Total SOURCE: School District Administrative Officials. Wages and Salaries Shown below, by school year, are the total wages and salaries paid by the School District in the categories of Instruction, Support Services and Noninstructional Services. Wages and Salaries School Year Ending Support Noninstructional June 30, Instruction Services Services Total 2008 $ 12,676,463 $ 4,740,893 $ 605,194 $ 18,022, ,087,702 4,896, ,997 18,632, ,046,829 4,936, ,832 19,596, ,029,099 4,412, ,713 19,065, ,103,344 3,842, ,933 17,521, (Budgeted) 13,895,893 4,297, ,149 18,778,764 SOURCES: Annual Financial Reports, School District Administrative Officials, and the Budget Report for the fiscal year ending June 30,

16 Pension Program Currently, all Pennsylvania school districts and intermediate units participate in a pension program administrated by the Commonwealth. The program is formally known as the Public School Employees' Retirement System ( PSERS ), and a percentage of each eligible employee's salary is contributed by the employee, the School District and the Commonwealth. All full-time employees, part-time employees salaried over eighty days per year and hourly employees with over five hundred hours per year participate in the program. Contributions are required by active members, School Districts, and the Commonwealth of Pennsylvania as established by the Public School Employees Retirement Code. Active members who joined PSERS prior to July 22, 1983, and who had no break in their public school service, contribute at 5.25% or at 6.50% of the member s qualifying compensation, depending on each member s class. Members who returned to public school service or who joined PSERS on or after July 22, 1983 and who were active or inactive as of July 1, 2001, contribute at 6.25% or at 7.50% of the member s qualifying compensation, depending on each member s class. Members who joined PSERS after June 30, 2001, contribute at 7.50%. For all new hires and for members who elected to do so, the higher contribution rates began with service rendered on or after January 21, The PSERS Board of Trustees has set the fiscal year employer retirement contribution rate at 12.36% of payroll. The fiscal year rate is to be set at 16.75%. Current financial projections indicate the possibility of significant increases in the contribution rate in future years. For further discussions of this increase, please refer to the PSERS website on the Internet: The Commonwealth will reimburse the School District at the rate of 50% of its total contributions with respect to all employees who were hired prior to July 1, With respect to employees hired after July 1, 1994, and who were not previously employed by another public school system in the Commonwealth, the School District will be reimbursed by the Commonwealth at the rate of the higher of 50% of contributions made by the School District or the current Market Value Aid Ratio. The School District is reimbursed on a quarterly basis by the Commonwealth. Shown below is a summary of the School District's annual retirement contributions to the pension program. School Year Ending June 30, Annual Retirement Contribution $ 1,326, ,223, , ,352, ,328, (Budgeted)... 2,316,643 (1) Includes both the Commonwealth and School District contributions. The Commonwealth contributions are now budgeted as an expense by the School District and are ultimately reimbursed, in part, by the Commonwealth to the School District. SOURCE: School District Administrative Officials. Labor Relations Teachers, librarians, and guidance counselors are represented for purposes of collective bargaining by the West Mifflin Federation of Teachers, which is affiliated with the American Federation of Teachers ( AFT ). The current collective bargaining between the School District and the AFT will expire on June 30, Local 585 of the Service Employees International Union ( SEIU ) represents all clerical, maintenance, custodial, and food service employees for purposes of collective bargaining. The expiration date of this collective bargaining agreement is June 30, The School District considers it labor relations to be excellent. No work stoppages have been staged by any bargaining unit personnel in the School in the last twenty-five years. SOURCE: School District Administrative Officials. 11

17 DEBT LIMITS AND REMAINING BORROWING CAPACITY OF THE SCHOOL DISTRICT The borrowing capacity of the School District is calculated in accordance with provisions of the Act, which describes the applicable debt limits for local government units, including school districts and municipalities. Under the Act, the School District may incur electoral debt, which is debt that is approved by a majority of the School District s voters at either a general or special election, in an unlimited amount. Combined net nonelectoral debt and net lease rental debt (debt represented by capital leases and other forms of agreement evidencing the acquisition of a capital asset) incurred on behalf of the School District may not exceed 225% of the School District s Borrowing Base. The Borrowing Base is calculated as the annual arithmetic average of Total Revenues (as defined in the Act), less any deductions or exceptions (as specified in the Act), for the three full fiscal years next preceding the date of incurring debt. The current Borrowing Base of the School District is shown herein, and the current schedule of existing electoral, nonelectoral, and lease rental debt is shown herein under the heading Schedule of Existing Indebtedness. The section Calculation of Debt Limits and Remaining Borrowing Capacity reflects the resulting maximum levels of nonelectoral and lease rental debt which the School District will be permitted to incur after the issuance and sale of the Bonds. Calculation of Borrowing Base Fiscal Year Ending June Total General Fund Revenues $ 43,560,108 $ 45,406,351 $ 44,560,389 Less: (i) Subsidies or reimbursements from the Federal Government or the Commonwealth of Pennsylvania in connection with particular projects financed by debt 307, , ,420 (ii) Project rates, receipts, user charges, special assessments and special levies pledged or budgeted for specific selfliquidating debt, or for payments under leases, guaranties, etc (iii) Interest on moneys in sinking funds, reserves, and other funds, which interest is pledged or budgeted in connection with outstanding debt, and on bond or note proceeds, if so pledged (iv) Grants and gifts in connection with construction or acquisition of specific projects (v) Proceeds from disposition of capital assets and other nonrecurring items 282, ,815 1,400,000 Total Exclusions $ 590,238 $ 1,224,572 $ 2,079,420 Net Revenues $ 42,969,870 $ 44,181,779 $ 42,480,969 Total Net Revenues for Three Years $ 129,632,618 Borrowing Base (Total Net Revenues / 3) $ 43,210,873 SOURCE: Annual Financial Reports of the School District and School District Administrative Officials. 12

18 Schedule of Existing Indebtedness (1)(2) a. Electoral Debt None b. Nonelectoral Debt: The Bonds $ 6,970,000 General Obligation Bonds, Series of ,960,000 General Obligation Notes, Series A of ,655,000 General Obligation Bonds, Series of ,490,000 General Obligation Bonds, Refunding Series of ,905,000 General Obligation Bonds, Refunding Series of ,010,000 Total Nonelectoral Debt $ 86,990,000 c. Lease Rental Debt - Total Net Nonelectoral and Lease Rental Debt $ 86,990,000 (1) For additional detailed information regarding the existing indebtedness of the School District, please see SCHEDULE OF DIRECT AND OVERLAPPING DEBT AND DEBT RATIOS and SCHEDULE OF DEBT SERVICE OBLIGATIONS herein. (2) After refunding of $3,570,000 in General Obligation Bonds, Series B of 2011 by the issuance of the Bonds. Calculation of Debt Limits and Remaining Borrowing Capacity Remaining Debt Borrowing Debt Item Debt Limit (1) Outstanding (2) Capacity Net Nonelectoral and Lease Rental Debt Limit $ 97,224,464 $ 86,990,000 $ 10,234,464 (1) 225% of Borrowing Base. (2) Includes the principal amount of Bonds offered through this Official Statement. Future Financing There are no further capital improvement projects presently contemplated by the School District that would require the incurrence of additional bonded indebtedness. 13

19 SCHEDULE OF DIRECT AND OVERLAPPING DEBT AND DEBT RATIOS Current Balance Estimated Debt Item Outstanding Local Share (1) Direct Debt: Total Nonelectoral Debt (2) $ 86,990,000 $ 77,489,160 Total Lease Rental Debt - - Total Direct Debt $ 86,990,000 $ 77,489,160 Overlapping Debt: Component Municipality Debt $ 7,967,079 $ 7,967,079 Proportionate share (1.67%) of Allegheny County debt 14,330,147 14,330,147 Total Overlapping Debt $ 22,297,227 $ 22,297,227 Total Direct and Overlapping Debt $ 109,287,227 $ 99,786,387 Debt Ratios: Direct Debt to Market Value 9.22% 8.21% Direct Debt to Assessed Valuation 9.14% 8.14% Direct Debt Per Capita (2010) $ 4, $ 3, Direct and Overlapping Debt to: Market Value 11.58% 10.58% Assessed Valuation 11.48% 10.48% Direct and Overlapping Debt Per Capita (2010) $ 5, $ 4, (1) Reflects projected reimbursement on future debt service payments to be received by the School District from the Commonwealth. (See SECURITY FOR THE BONDS - Commonwealth Aid to School Districts.) (2) Reflects the principal amount of Bonds offered through this Official Statement. SOURCES: School District Administrative Officials, Pennsylvania Department of Education and the Department of Community and Economic Development. HISTORY OF TAX ANTICIPATION BOND FINANCING Year Ending June 30, Principal Amount *Tentative $ ,000, ,000, ,000, ,000,000* SOURCE: School District Administrative Officials. 14

20 SCHEDULE OF DEBT SERVICE OBLIGATIONS (1) Nonelectoral Debt The Bonds G. O. Notes (2) General Obligation Bonds (2) Fiscal Year Refunding Refunding Ending Series A Series B Series Series Series Series Series B June 30, Principal Interest Subtotal of 2011 of 2011 of 2012 of 2009 of 2005 of 2003 of 2002 Subtotal Total 2013 $ - $ - $ - $ 142,045 $ 238,033 $ 68,246 $ 2,065,363 $ 1,401,733 $ 2,333,338 $ 19,333 $ 6,268,088 $ 6,268, , , , , ,744 2,064,763 1,400,590 2,335,025-6,242,036 6,505, , , , , ,744 2,069,113 1,398,510 2,331,001-6,238,153 6,489, , , , , ,744 2,118,300 3,211, ,200-6,338,224 6,589, , , , , ,744 2,120,863 3,807, ,368,471 6,619, , , , , ,644 2,122,663 3,803, ,364,471 6,615, , , , , ,544 2,129,263 3,799, ,369,001 6,620, , , , , ,344 2,125,225 3,804, ,367,694 6,618, , , , , ,144 2,131,188 3,800, ,367,656 6,618, , , , , ,806 2,121,331 3,806, ,366,163 6,617, , , , , ,075 2,256,706 3,802, ,384,819 6,635, , , , , ,944 6,225, ,550,300 6,800, , , , , ,813 6,223, ,547,831 6,798, , , , , ,681 6,225, ,549,963 6,800, , , , , ,550 6,226, ,550,844 6,800, , , , , ,400 6,223, ,546,531 6,796, , , , , ,250 6,225, ,548,244 6,797, , , , , ,100 6,225, ,548,531 6,798, , , ,369 1,403, ,950 4,147, ,229,469 6,478, , , ,194 1,368,250-4,228, ,597,200 5,846, ,160, ,019 4,404, ,442, ,442,000 5,846, ,715,000 98,419 2,813, ,813,419 Total... $ 6,970,000 $ 5,020,977 $ 11,990,977 $ 5,300,713 $ 238,033 $ 10,573,415 $ 71,047,175 $ 34,036,458 $ 7,570,564 $ 19,333 $ 128,785,689 $ 140,776,666 (1) Does not reflect projected reimbursement payments to be received by the School District from the Commonwealth. (See SECURITY FOR THE BONDS - Commonwealth Aid to School Districts" herein) (2) Reflects both principal and interest payments. NOTE: Totals may not add due to rounding. 15

21 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES OF THE SCHOOL DISTRICT Annual Budget Development Section 687 of the School Code requires the Board of School Directors of the School District to adopt an annual budget. Said budget must be prepared in accordance with generally accepted accounting principles ( GAAP ). The School District's administrative staff estimates all expected revenues and expenditures for the School District. The Pennsylvania Department of Education assists school districts in their estimates for all Commonwealth subsidies expected to be received by providing estimates of both the median local school district tax effort in equalized mills and the median school district institutional expenditures per weighted average daily membership. Such data can be used to help establish reasonable estimates of the amount of Commonwealth revenues for which the School District may qualify. After the budget is prepared, it must be made available for public inspection. The Board of School Directors must adopt the budget before the beginning of each fiscal year (July 1), and then levy the taxes necessary to provide for the revenues budgeted. Accounting and Auditing Policies and Procedures Lawson & Company, Certified Public Accountants, Pittsburgh, Pennsylvania, currently serves as the independent auditor for the School District (the "Auditor"). Effective July 1, 1984, the procedures for Pennsylvania school systems for budgeting, accounting, and financial reporting were revised in order to provide for a uniform, statistical system of financial management based on GAAP. In the opinion of the Auditor, the accounting policies of the School District conform to GAAP. Additionally, the Governmental Accounting Standards Board ( GASB ) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The following summary of significant accounting policies of the School District is based in part on the June 30, 2012 Audit Report prepared by the Auditor. Basis of Presentation - Fund Accounting The accounts of the School District are organized on the basis of funds and account groups, each of which is considered a separate fiscal and accounting entity. The operations of each fund are accounted for with a separate set of accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The major fund types and the specific funds which are included within each of these major fund types are as follows: Governmental (General Fund, Debt Service Fund, and Capital Projects Funds); Proprietary (Food Service Fund); and Fiduciary (Trust and Agency Funds). Basis of Accounting Basis of Accounting refers to the timing of recognition of revenues and expenditures/expenses in the funds and reported in the financial statements. The modified accrual basis of accounting is followed for all governmental funds of the School District. Under the modified accrual basis of accounting, expenditures, other that interest on long-term debt which is recorded as paid, are recorded when the liability is incurred and revenues are recognized when they become susceptible to accrual, i.e. measurable and available to finance the District s operations. Available means collectible within the current period or within 60 days after year end. The accrual basis of accounting is used for the Food Service Fund (proprietary fund) as well as, in the operation of the government-wide financial statements. Under this basis of accounting, revenues are recognized when earned and expenses are recognized when the related liability is incurred. Reconciliations are presented after the appropriate governmental fund financial statement adjusting to the accrual basis of accounting from the modified accrual basis of accounting. The agency fund is presented on the cash basis. Revenues are recognized as cash is received and expenses are recognized as cash is paid out. Investment Policy The School Code authorizes the School District to invest in U.S. Treasury bills, short-term obligations of the U.S. Government or its agencies or instrumentalities, savings accounts or time deposits of institutions to the extent that they are insured or have approved collateral pledged by the depositary, or obligations of the United States of America, the Commonwealth, or any of its political subdivisions backed by the full faith and credit of each body. 16

22 SUMMARY STATEMENT OF FUND BALANCE TRENDS - - GENERAL FUND Fiscal Year Ending June (Budgeted) Revenues: Local Sources $ 28,801,618 $ 27,520,908 $ 28,436,549 $ 27,669,180 $ 27,773,050 State Sources 13,893,329 13,174,843 13,584,548 14,098,589 14,375,140 Federal Sources 1,311,225 2,862,630 3,382,639 1,023,700 1,012,173 Other Financing Sources: Bond Proceeds 3,632, Sale of Fixed Assets 923 1,725 2,615 34,951 1,400,000 Total Revenues and Other Financing Sources $ 47,639,120 $ 43,560,106 $ 45,406,351 $ 42,826,420 $ 44,560,363 Expenditures: Instruction $ 25,023,399 $ 25,957,491 $ 24,291,025 $ 23,014,770 $ 24,522,088 Support Services 14,558,794 14,265,687 12,246,776 11,881,397 12,640,607 Operation of Noninstructional Services 1,384,714 1,258,119 1,037, ,592 1,061,776 Debt Service 8,276,524 5,921,733 4,220,408 3,896,292 6,699,600 Facilities Acquisition, Construction & Improvement Services ,000 (98,722) - Fund Transfers - 5, Authority Obligations Refunds of Prior Year Receipts 801, , , ,868 - Budgetary Reserve Total Expenditures and Other Financing Uses $ 50,044,539 $ 48,014,410 $ 43,079,289 $ 40,485,197 $ 44,924,071 Revenues and Other Financing Sources Over (Under) Expenditures and Other Financing Uses $ (2,405,419) $ (4,454,304) $ 2,327,062 $ 2,341,223 $ (363,708) Fund Balance, July 1 $ 3,741,029 $ 1,335,610 $ (3,118,694) $ (791,632) $ 445,829 Increase (Decrease) in Reserves for Inventory/Prepaid Expenses Fund Balance, June 30 $ 1,335,610 $ (3,118,694) $ (791,632) $ 1,549,591 $ 82,121 SOURCES: Annual Financial Reports, School District Administrative Officials, and the General Fund Budget Report for the fiscal year ending June 30,

23 SUMMARY STATEMENT OF ASSETS, LIABILITIES, AND FUND EQUITY - - GENERAL FUND Fiscal Year Ending June Assets: Cash $ 6,533,445 $ 3,390,647 $ 334,898 $ 734,891 $ 4,588,689 Investments (at cost) 1,329,092 1,707,067 55, , ,905 Accounts Receivable (Other) 419, , , , ,715 Interfund Receivables 55, , , ,168 77,357 State and Federal Subsidies Receivable 1,391, ,412 1,027, , ,319 Prepaid Expenditures 343, , , , ,788 Other Receivables Delinquent and Liened Real Estate Taxes 325, , , , ,454 Total Assets $ 10,398,279 $ 7,395,888 $ 3,660,714 $ 4,022,120 $ 7,041,227 Liabilities: Accrued Salaries and Wages $ 2,654,353 $ 2,695,647 $ 2,863,303 $ 2,677,145 $ 2,071,347 Accrued Retirements/Benefits 683, , , , ,758 Accrued Payroll Liabilities - - 1, Accounts Payable 2,190,909 1,391,096 2,880, ,592 2,163,851 Due to Other Funds 16, Matured Bonds and Interest Payable Property Taxes Payable: Deferred Revenue (Delin. and Liened Taxes) 325, , , , ,454 Deferred Revenue (Taxes Pd. Under Protest) 785, ,741 22,515 44,515 61,226 Total Liabilities $ 6,657,249 $ 6,060,278 $ 6,779,408 $ 4,813,752 $ 5,491,636 Fund Equity: Standard/Specific Fund Balance Reserves $ - $ - $ - $ 1,100,376 $ 1,318,738 Unreserved Fund Balance 3,741,029 1,335,610 (3,118,694) (1,892,008) 230,853 Total Fund Equity $ 3,741,029 $ 1,335,610 $ (3,118,694) $ (791,632) $ 1,549,591 Total Liabilities and Fund Equity $ 10,398,278 $ 7,395,888 $ 3,660,714 $ 4,022,120 $ 7,041,227 SOURCE: Annual Financial Reports and School District Administrative Officials. 18

24 TAXES AND TAXING POWERS OF THE SCHOOL DISTRICT As a school district of the third class, the School District is empowered to levy taxes by applicable provisions of both the School Code, and the Local Tax Enabling Act (Act of December 31, 1965, as amended, the Tax Enabling Act ), both as further described below. However, various statutes enacted since the original enactment of the School Code and the Tax Enabling Act have limited or restrained the School District s tax powers, as further described below. Real Estate and Per Capita Taxes The School District may levy the following taxes under the School Code: 1. An annual tax on all taxable real estate, not to exceed 25 mills on each dollar of assessed valuation, to be used for general school purposes. 2. An annual tax on all taxable real estate, with no millage limitation, to provide for the payment of: (a) (b) (c) (d) Salaries and increments of the teaching and supervisory staff; Rentals due any municipal authority, non-profit corporation or the State Public School Building Authority; Interest and principal on any indebtedness incurred under the Local Government Unit Debt Act or any prior or subsequent act governing the incurrence of indebtedness, and The amortization of a bond issue which financed the construction of school facilities if issued prior to the first Monday of July, An annual per capita tax on each resident over eighteen years of age of not more than $5.00. Earned Income and Miscellaneous Taxes The School District may levy the following taxes under the Tax Enabling Act, as limited to the rates set forth in the chart below. Additionally, the aggregate amount of taxes imposed under the Tax Enabling Act may not exceed 1.25% of the market valuation of the real estate in the School District as determined by the State Tax Equalization Board. These taxes are also subject to apportionment between overlapping municipalities and the School District when such municipalities exercise the right of apportionment. (1) Per Capita Tax... $10.00 (2) Gross Receipts tax on wholesalers... 1 mill (3) Gross Receipts tax on retailers and restaurants... 1 ½ mills (4) Wages, salaries, commissions and other earned income of individual residents... 1% (5) Retail sales of tangible personal property... 2%* (6) Admissions to amusements... 10% (7) Occupational privilege... $10.00 *Pre-empted by the Commonwealth s Sales and Services Tax. 19

25 Tax Data for the Fiscal Year Ending June 30, 2013 Taxable Est. Revenue Assessed Millage Available for Tax Category Valuation Rate Appropriation Current Real Estate Taxes $ 1,008,632, $ 23,171,519 Less Homestead Exclusions (1,464,215) Tax Levy Minus Homestead Exclusions $ 21,707,304 Percent Collected % Net Tax Revenue $ 19,970,720 Rate Tax Levy Current Act 511 Taxes - Flat Rate Assessments: Local Services / Occupational Privilege Taxes $5.00 $ 100,000 $ 100,000 Total Act 511 Taxes, Flat Rate Assessments $ 100,000 $ 100,000 Current Act 511 Taxes - Proportional Assessments: Earned Income Taxes 0.50% $ 1,800,000 $ 1,800,000 Real Estate Transfer Taxes 1.00% 157, ,000 Amusement Taxes 10.00% 525, ,000 Business Privilege Taxes Millage 6 850, ,000 Mercantile Taxes , ,000 Total Act 511 Taxes, Proportional Assessments $ 3,907,000 $ 3,907,000 Total Act 511, Current Taxes $ 4,007,000 Act 511 Tax Limit = $11,441,977 ($953,498,053 Market Value x 12 mills). SOURCE: General Fund Budget Report of the School District for the fiscal year ending June 30, Total Real Estate Tax Millage Rates - for the Fiscal Year Ending June 30, 2013 Component West Mifflin Area Municipality School District Allegheny County Political Subdivision Millage Rate Millage Rate Millage Rate Total West Mifflin Borough Whitaker Borough SOURCES: General Fund Budget Report for the fiscal year ending June 30, 2013 and School District Administrative Officials. 20

26 Major Real Estate Taxpayers The ten largest taxpayers in the School District and their current assessed valuation of real estate are as follows: Assessed Taxpayer Description Valuation Tech One Associates Shopping Center $ 73,428,071 United States Steel Co Producer of Steel Products 37,580,400 Century III Associates Shopping Mall 36,471,000 Wal-Mart Real Estates Business Trust Shopping Center 20,585,500 Inland Western West Mifflin Century III LP Shopping Center 20,354,300 Festival Fun Parks Amusement Park 12,300,900 AEG Westinghouse Transportation Systems Inc. Transportation Systems 8,590,800 Dayton-Hudson Corporation General Merchandise Retailer 8,000,000 Riverview Homes Association Real Estate 7,200,000 Speciality Group Industries Inc. Warehousing & Storage 6,858,100 $ 231,369,071 The total assessed valuation of these ten largest taxpayers is equal to % of the assessed valuation of the School District. SOURCE: School District Administrative Officials. Real Estate Tax Collection Procedures Real estate tax notices are generally mailed to all owners of property located within the School District on or before August 1 of each year. Taxes are payable at a 2% discount during the months of August and September, and at face during October and November. Beginning December 1, a 10% penalty is added to the face amount outstanding. Generally, the books of the Municipal Tax Collectors are closed out at the end of February of each year. Effective March 1, all information relating to uncollected taxes is then provided to the Allegheny County Tax Claim Bureau, which then pursues the collection of the property taxes which are then considered delinquent. While the Bureau will accept partial payments on delinquent taxes, a lien will be placed on the property of the delinquent taxpayer who has made no effort to make partial payments within one year of the beginning of the penalty period. Public tax sale proceedings are customarily instituted by the delinquent tax collector against property owners who reach a delinquency period of two years or longer and who have made no effort to reduce their balance outstanding; installment payments may be made through a written agreement between the delinquent tax collector and the delinquent taxpayer. SOURCE: School District Administrative Officials. 21

27 Real Estate Tax Collection Data Fiscal Year Ending June 30 Item (1) Assessed Valuation $ 1,124,970,996 $ 1,121,299,588 $ 1,059,402,259 $ 1,017,104,934 $ 1,020,926,164 Levy 23,748,771 24,022,532 24,647,495 24,192,330 23,413,134 Current Collections 22,592,427 21,383,850 20,748,736 21,430,304 20,311,880 Current & Delinquent Collections 23,324,254 22,437,369 21,352,783 22,087,010 21,703,651 % Current Collections 95.13% 89.02% 84.18% 88.58% 86.75% % Total Collections 98.21% 93.40% 86.63% 91.30% 92.70% Average Collection Rates: Current 88.73% Total 92.45% SOURCE: Annual Financial Reports of the School District. (1) is the first year of the State Property Tax Reduction allocation. COMPREHENSIVE LIMITATION ON TAXING POWERS UNDER THE TAXPAYER RELIEF ACT Pennsylvania Act No. 1 of the Special Session of 2006 (the The Taxpayer Relief Act ), which became effective June 27, 2006 provides, inter alia, that a school district may not, in fiscal year or in any subsequent fiscal year, levy any tax for the support of the public schools which was not levied in the fiscal year, raise the rate of any earned income and net profits tax, if already imposed under the authority of the Local Tax Enabling Act (Act 511), or increase the rate of any tax for school purposes by more than the Index (defined below), unless in each case either (a) such increase is approved by the voters in the school district at a public referendum or (b) one of the exceptions provided therein is applicable. On June 30, 2011, the General Assembly adopted legislation ( Act 25 of 2011 ) amending The Taxpayer Relief Act, eliminating several exceptions previously permitted under The Taxpayer Relief Act and providing for the rescission of certain prior approved referendum exceptions for disaster/emergency costs, implementation of a court order, school construction and non-academic school construction (effective after the last payment of principal and interest on debt incurred to finance same) (The Taxpayer Relief Act together with Act 25 of 2011 will hereinafter be referred to as the Taxpayer Relief Act ). The exceptions available under the Taxpayer Relief Act are summarized as follows: 1. to pay interest and principal on indebtedness incurred (i) prior to September 4, 2004, in the case of a school district which had elected to become subject to the provisions of the prior Homeowner Tax Relief Act, Act 72 of 2004, or (ii) prior to June 27, 2006, in the case of a school district which had not elected to become subject to Act 72 of 2004; to pay interest and principal on any indebtedness approved by the voters at referendum; to pay interest and principal on any indebtedness refunding or refinancing debt for which one of the above exceptions is permitted, as long as the refunding or refinancing incurs no additional debt other than for costs and expenses related to the refunding or refinancing and the funding of appropriate debt service reserves; 2. to pay costs incurred in providing special education programs and services to students with disabilities, under specified circumstances; 3. To make payments into the State Public School Employees Retirement System when the increase in the actual dollar amount of estimated payments between the current year and the upcoming year is greater than the Index. A school district intending to utilize the foregoing exceptions is entitled to apply to the Pennsylvania Department of Education ( PDE ) for approval thereof, if and to the extent a tax increase greater than the Index is needed in any particular fiscal year. The Taxpayer Relief Act provides that PDE shall approve a school district s request if a review of the data demonstrates that the school district qualifies for the exception sought and the sum of the dollar amounts of all exceptions for which the school district qualifies is not more than what is necessary to balance the budget after giving effect to the revenue to be raised by the allowable increase under the Index. There can be no assurance, however, that approval will be given by PDE to utilize a referendum exception in any future fiscal year or years. Any revenue derived from an increase in the rate of any tax allowed under the exception numbered 1 above may not exceed the anticipated dollar amount of the expenditure, and any revenue derived from an increase in the rate of any tax allowed pursuant to any other exception enumerated above may not exceed the rate increase required, as determined by PDE. If a school district s petition or request to increase taxes by more than the Index pursuant to one or more of the allowable exceptions is not approved, the school district may submit the proposed tax increase to a referendum. 22

28 The Index is the arithmetic average of: (1) the percentage increase in the statewide average weekly wage, as determined by the State Department of Labor and Industry for the preceding calendar year; and (2) the employment cost index for elementary and secondary schools, as reported by the federal Bureau of Labor Statistics for the preceding 12-month period beginning July 1 and ending June 30. For school districts with a Market-Value/Income-Aid Ratio greater than 0.40 for the prior school year, however, the Index is the adjusted upward by multiplying the unadjusted Index by the sum of 0.75 and such Aid Ratio. The School District s Market Value Aid Ratio for FYE June 30, 2012 was ; accordingly, the School District s Index limitation for the current fiscal year was set at 2.4%. The information set forth above is a summary of The Taxpayer Relief Act. This summary is not intended to be an exhaustive discussion of the provisions of The Taxpayer Relief Act nor a legal interpretation of any provision of The Taxpayer Relief Act, and a prospective purchaser of the Bonds should review the full text of The Taxpayer Relief Act as a part of any decision to purchase the Bonds. Status of the Bonds under The Taxpayer Relief Act A portion of the Bonds are being issued to refund the outstanding principal amount of the District s General Obligation Notes, Series B of 2011 (the Series B of 2011 Refunded Notes ). The Series B of 2011 Refunded Notes represents debt incurred by the School District after the effective date of The Taxpayer Relief Act; therefore tax levies in excess of the index which may be necessary to pay debt service in respect of the Bonds are not eligible for the exception to the referendum requirement, as described in paragraph number 1 above. A portion of the Series of 2013 Bonds are being issued to provide financing for capital improvements within the District and any real estate increase required to pay the debt service on such Bonds, together with tax increases for general school expenses in the same year, must not exceed the Index (as described above) in that year or face a voter referendum on the increase above the Index. ADDITIONAL LIMITATIONS Limitation on Certain Mercantile and Business Privilege Taxes In November, 1988, Pennsylvania enacted local tax reform legislation intended to reduce local government s dependency on ad valorem real estate taxes and certain so-called nuisance taxes authorized under the Tax Enabling Act. Full implementation of this legislation depended on voter approval of an amendment to the Pennsylvania Constitution. As submitted to referendum in May, 1989, the constitutional amendment failed. Thus, most observers concluded the supporting legislation was void. However, subsequent court rulings found certain provisions of the legislation to be independent of, and to survive, the referendum. According to this caselaw, the School District may not levy new, or increase the rate of existing (as of November, 1988), gross receipts taxes enumerated as items (2) and (3) in the chart under Earned Income and Miscellaneous Taxes above; however, the School District may levy, or increase the levy of, such taxes at a flat rate. Notwithstanding the foregoing, The Taxpayer Relief Act, while not specifically invalidating such court rulings, has effectively overridden their applicability; the School District has taken no action to levy flat rate gross receipts taxes. Replacement of the Occupation Tax Act 24 of 2001 (effective on June 22, 2001) authorizes a board of school directors to schedule a public hearing and conduct a ballot referendum on replacing the school district s occupation tax with an increase in the local earned income tax. Currently, school districts in Pennsylvania share a maximum 1.0% tax on the annual amount of residents wages and other earned income, with the resident municipality; see Earned Income and Miscellaneous Taxes above. Under Act 24, this tax could be increased by the percentage necessary to generate revenue equal to what was collected during the preceding year on the occupation tax. The occupation tax is a flat amount for all employed individuals, or assessed by various trade, occupation and professional titles, regardless of income. The restructured tax is designed to be revenue neutral to the school district. Notwithstanding the foregoing, The Taxpayer Relief Act, while not specifically repealing Act 24, has effectively overridden its applicability; the School District has taken no action to implement Act

29 Unreserved Fund Balances Act 48 of 2003 (enacted December 23, 2003) prohibits a school district from increasing real property taxes for the school year or any subsequent school year, unless the school district s budgeted year-ending unreserved, undesignated, general fund balance does not exceed a specified percentage of total budgeted expenditures, as set forth below: Total Budgeted Expenditures Budgeted Year-Ending Unreserved, Undesignated, Fund Balance as a Percentage of Total Budgeted Expenditures Less than or equal to $11,999, % Between $12,000,000 and $12,999, % Between $13,000,000 and $13,999, % Between $14,000,000 and $14,999, % Between $15,000,000 and $15,999, % Between $16,000,000 and $16,999, % Between $17,000,000 and $17,999, % Between $18,000,000 and $18,999, % Greater than or equal to $19,000, % Act 48 has no direct relationship to The Taxpayer Relief Act, and its limitations on tax levies are in addition to those found in The Taxpayer Relief Act. REAL PROPERTY VALUES TREND Assessed Fiscal Year Ending June 30, Valuation Market Value Ratio 2008 $ 1,024,622,696 (1) $ 920,653,600 (1) % ,022,332,288 (1) 972,353,200 (1) % ,151,983 (1) 919,669,600 (1) % ,718,159 (1) 953,498,053 (1) % ,155,634 (1) 943,436,042 (1) % 2013 (Budgeted) 1,008,632,640 (2) 999,395,847 (3) % Percent of Change ( ) -1.56% 8.55% --- (1) SOURCE: Pennsylvania State Tax Equalization Board. (2) SOURCE: General Fund Budget for Fiscal Year Ending and June 30, (3) Based on the prior year ratio. Note: The assessed valuation data depicted in this table differs from that shown in the Real Estate Tax Collections Data table due to the utilization of different source documents. THE PAYING AGENT Pursuant to the provisions of the Resolution, as paying agent and sinking fund depositary, the Paying Agent has the limited duty of receiving payments from the School District, depositing such payments in a sinking fund and making payments to the owners of the Bonds of the principal of, interest on, and premium, if any, on the Bonds when due, but only to the extent such moneys have been received. As registrar and transfer agent, the Paying Agent has the limited duty of handling the registration and transfer of the Bonds. Accordingly the Paying Agent performs ministerial duties not involving the exercise of discretion and assumes no fiduciary relationship with respect to the owners of the Bonds. The Paying Agent may now or in the future have banking relationships with the School District which involve making loans to the School District; these loans may have a security feature which is different from that of the security feature associated with the Bonds. The Paying Agent may also serve as trustee or paying agent and sinking fund depositary on other obligations issued by or on behalf of the School District. 24

30 CONTINUING DISCLOSURE UNDERTAKING In accordance with the requirements of Rule 15c2-12 (the "Rule") promulgated under the Securities and Exchange Act of 1934, as amended, by the Securities and Exchange Commission (the "Commission"), the School District will, in the Disclosure Certificate to be executed by the School District on the date of settlement of the Bonds, agree to provide, or cause to be provided: (i) to the Municipal Security Rulemaking Board s ( MSRB ) Electronic Municipal Market Access System ( EMMA ), certain annual information and operating data (collectively, the "Annual Information"), generally consistent with the information contained under the following captions contained herein: SECURITY FOR THE BONDS - Commonwealth Aid to School Districts; WEST MIFFLIN AREA SCHOOL DISTRICT - Organization and Central Administration; School Building Facilities; Enrollment History and Projections; Employment; Wages and Salaries; Pension Program; Labor Relations; HISTORY OF TAX ANTICIPATION BOND FINANCING; TAXES AND TAXING POWERS OF THE SCHOOL DISTRICT - Tax Data for the Fiscal Year Ending June 30, 2013; Major Real Estate Taxpayers; Real Estate Tax Collection Data; and REAL PROPERTY VALUES TREND; (ii) the School District's annual audited financial statements, which shall be prepared in conformity with generally accepted accounting principles consistently applied as applicable to school districts of the Commonwealth of Pennsylvania; The annual information will be provided to the entities identified above not later 270 days following the fiscal year ending the previous June 30; (iii) (iv) in a timely manner, not in excess of (10) business days after the occurrence of any of the following events, to the MSRB via EMMA, notice of the occurrence of any of the following events with respect to the Bonds, regardless of materiality: (1) principal and interest payment delinquencies; (2) unscheduled draws on debt service reserves reflecting financial difficulties; (3) unscheduled draws on credit enhancements reflecting financial difficulties; (4) substitution of credit or liquidity providers, or their failure to perform; (5) adverse tax opinions the issuance by the Internal Revenue Services of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events effecting the tax status of the Bonds; (6) tender offers; (7) defeasances; (8) rating changes; and (9) bankruptcy, insolvency, receivership or similar event of the obligated person. in a timely manner, not in excess of (10) business days after the occurrence of any of the following events, to the MSRB via EMMA, notice of the occurrence of any of the following events with respect to the Bonds, if such event is material: (1) non-payment related defaults; (2) modifications or rights of Bond holders; (3) bond calls; 25

31 (4) release, substitution, or sale of property securing repayment of the Bonds; (5) the consummation of a merger, consolidation, or acquisition involving an obligated person or the sale of all or substantially all of the assets of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, or other than pursuant to its terms; (6) appointment of a successor or additional trustee or the change of name of a trustee. (v) in a timely manner, not in excess of ten (10) business days, to the MSRB via EMMA, notice of its failure to provide the Annual Information and audited financial statements with respect to itself on or before the date specified in the Disclosure Certificate. The obligations of the School District described above will remain in effect only for such period as (i) the Bonds are outstanding in accordance with their terms, and (ii) the School District remains an obligated person with respect to the Bonds within the meaning of the Rule. The School District reserves the right to terminate its obligation to provide the Annual Information, audited financial statements, and notices of material events, as set forth above, if and when the School District is no longer an obligated person with respect to the Bonds within the meaning of the Rule. The School District acknowledges that its undertaking pursuant to the Rule described under this caption is intended to be for the benefit of the holders of the Bonds (including holders of beneficial interests in the Bonds). Each Bondholder (including beneficial owners) may enforce the School District's continuing disclosure undertaking; provided that, the right to enforce the provisions of the undertaking will be limited to a right to obtain specific enforcement of the School District's obligations under its continuing disclosure undertaking. Any failure by the School District to comply with the provisions of the undertaking will not constitute a default or an event of default with respect to the Bonds. The obligations of the School District described above may be amended without the consent of the Bondholders, to the extent permitted by the Rule, as from time to time amended. The School District is currently up to date with the annual filing requirements. The School District has inadvertently missed the December 31 filing date for previous Financial Statements, specifically, the Financial Statements for fiscal year ending June 30, 2008 were filed on July 22, 2009, the Financial Statements for fiscal year ending June 30, 2009 were filed on May 15, 2012, the Financial Statements for fiscal year ending June 30, 2010 were filed on February 1, 2011, the Financial Statements for fiscal year ending June 30, 2011 were filed on January 3, 2012, and the Financial Statements for fiscal year ending June 30, 2012 were filed on January 31, Procedures have been implemented to ensure that the annual filing requirements will be met going forward. LITIGATION STATEMENT There is no litigation of any nature pending against the School District as of the date of this Official Statement to restrain or enjoin the issuance, sale, execution or delivery of the Bonds or in any way contesting or affecting the validity of the Bonds or the security therefore, or any proceedings of the School District taken with respect to the issuance or sale thereof. At the time of delivery of the Bonds, the School District will furnish a certificate to the effect that no such litigation is then pending. LEGAL OPINIONS Certain legal matters relating to the authorization and issuance of the Bonds will be subject to the approving opinion of Grogan Graffam, P.C., Pittsburgh, Pennsylvania, as Bond Counsel. Certain legal matters will be passed upon for the School District by George S. Gobel, Esq., McKeesport, Pennsylvania, as Solicitor to the School District. TAX MATTERS In the opinion of Bond Counsel, assuming compliance by the School District with the covenants referred to below, the interest on and accruals of original issue discount with respect to the Bonds (a) are excluded from gross income for federal income tax purposes and (b) are not items of tax preference within the meaning of Section 57(a)(5) of the Internal Revenue Code of 1986, as amended (the Code ), for purposes of the federal alternative minimum tax imposed by Section 55 of the Code on individuals and corporations; however, it should be noted that with respect to corporations (as defined in the Code for federal income tax purposes), such interest and accruals are taken into account in determining adjusted current earnings for the purposes of computing the alternative minimum tax imposed by Section 55 of the Code on such corporations. Accruals of original issue discount with respect to a Bond allocable to an owner of the Bond under a constant yield method of accrual (a) are not included in gross income for federal income tax purposes and (b) are added to such owner s tax basis in the Bond for the purpose of determining gain or loss for federal income tax purposes upon sale, exchange, redemption or other disposition of the Bond. The opinions set forth in the preceding two sentences are subject to the condition that the School District comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon and accruals of original issue discount with respect to the Bonds be (or continue to be) excluded from gross income for federal income tax purposes. Failure to comply with such requirements could cause the interest on and accruals of original issue discount with respect to the Bonds to be included in gross income retroactively to the date of issuance of the Bonds. The School District has covenanted to comply with all such requirements. 26

32 The School District will issue its certificate to the effect that on the basis of the facts, estimates and circumstances in existence on the date of delivery of the Bonds, it is not expected that proceeds of the Bonds will be used in a manner that would cause the Bonds to be or become arbitrage bonds as described in Section 103(b)(2) and Section 148 of the Code, as contemplated by the United States Treasury regulations relating to arbitrage. Bond Counsel is also of the opinion that the Bonds are exempt from personal property taxes in Pennsylvania; and the interest on the Bonds is exempt from Pennsylvania Corporate Net Income Tax and from Pennsylvania State and local personal income tax under present statutory and case law. Bond Counsel offers no opinion as to the exclusion of interest on and accruals of original issue discount from Pennsylvania Corporate Net Income Tax and from Pennsylvania State and local personal income tax. Federal Alternative Minimum Tax Calculations Under the Code, the federal alternative minimum taxable income of a corporation is based in part upon the adjusted current earnings of the corporation, which includes interest on and accruals of original issue discount with respect to the Bonds held by the corporation, although such interest and accruals of original issue discount with respect to the Bonds may not be includable in gross income for calculations of regular federal income tax liability. A prospective corporate purchaser of the Bonds should consult its professional tax advisors as to the potential impact upon its income tax liability. Taxable Social Security and Railroad Retirement Benefits Calculation Interest on and accruals of original issue discount with respect to the Bonds are included in modified adjusted gross income in determining the portion of Social Security of railroad retirement benefits to be included in an individual taxpayer s gross income for federal income tax purposes. A prospective purchaser of the Bonds who is receiving Social Security or railroad retirement benefits should consult his or her professional tax advisors as to the effect interest income derived from the Bonds may have upon his or her income tax liability. Property and Casualty Insurance Company income Taxes Under the Code, a property and casualty insurance company, in any taxable year, must reduce its deduction for losses incurred by a percentage of the tax-exempt interest received by such property and casualty insurance company during the taxable year. In addition, a portion of the dividends received by a property and casualty insurer attributable to tax-exempt income is not deductible by the insurer for federal income tax purposes. The Code provides generally that these provisions are effective for tax years beginning after December 31, 1986, and with respect to obligations acquired after August 7, 1986, but a property and casualty insurer should consult its professional tax advisors for a full explanation of the effect of these provisions upon its income tax liability. Tax on Excess Passive Net Income of S Corporation An S Corporation may be subject to federal income taxation on passive investment income including interest on and accruals of original issue discount with respect to the Bonds, if the S Corporation has subchapter C earnings and profits at the close of the taxable year and the S Corporation s passive investment income exceeds 25% of its gross receipts for the taxable year. A prospective purchaser of the Bonds that is an S Corporation should consult its professional tax advisors as to the effect of interest income from the Bonds on its tax liability. Branch Profits Tax Interest on and accruals of original issue discount with respect to the Bonds held by a foreign corporation could be subject to a branch profits tax imposed by Section 884 of the Code. A prospective foreign corporate purchaser of the Bonds may wish to consult its professional tax advisors as to the impact of the branch profits tax on its U.S. tax liability. 27

33 Interest Expense Deductions for Financial Institutions Under Section 265 of the Code, financial institutions are denied any deduction for interest expenses that are allocable, by a formula, to tax-exempt obligations acquired after August 7, An exception, which permits a deduction for 80% of such interest expenses, is provided in respect of certain tax-exempt obligations issued by a qualified issuer that specifically designates such obligations as qualified tax-exempt obligations under Section 265 of the Code. The School District is a qualified issuer and the School District has designated the Bonds as qualified tax-exempt obligations for the purposes and effect contemplated by Section 265 of the Code. Financial institutions intending to purchase Bonds should consult their own tax advisors to determine the effect of the interest expense deduction on their federal tax liability. Interest Reporting Requirements Under the Code, all taxpayers are required to report on their federal income tax returns the amount of interest received or accrued during the year that is exempt from federal income tax. This provision applies to interest on all tax-exempt bonds including the Bonds. Market Discount A tax-exempt bond such as a Bond, acquired by purchase after April 30, 1993, other than at original issuance, is a market discount bond if the bond is purchased at a price less than its stated principal amount (or, in the case of a bond issued with original issue discount, its issue price increased for accruals of original issue discount), with such difference being the amount of market discount. If a holder recognizes gain on the disposition of a market discount bond (including by early redemption or gift), a portion of the gain (up to the amount of market discount that accrued while the bond was held by such holder) will be treated as ordinary income and not as capital gain. For this purpose, market discount accrues on a straight-line basis or, if elected by the holder, on a constant interest rate basis; the election, on a bond-by-bond basis, is irrevocable once made. The holder of a market discount bond may elect to include the market discount in income as taxable interest income as the market discount accrues. The current inclusion election, once made, applies to all market discount obligations acquired by such holder on or after the first day of the first taxable year in which the election applies, and may not be revoked without the permission of the Internal Revenue Service. If the current inclusion election is made, the holder s tax basis in the market discount bond is increased by the amount of market discount accruals included in income. Original Issue Discount The difference between the final offering price to the public of the Bonds that mature on April 15 of the years 2023, 2028, and 2032 through and including 2034 (the OID Bonds ) and the maturity amount of such OID Bonds is treated as original issue discount. Because of the possibility of transfers, redemption or other disposition prior to maturity, the Code provides rules for the accrual of original issue discount on any tax exempt obligation including any securities issued in the form of the Bonds. Original issue discount on the OID Bonds is treated as accruing in the manner provided by the Code with respect to original issue discount on taxable securities, except that the rules with respect to acquisition premium and de minimis original issue discount that apply to taxable securities will not apply to tax-exempt securities. Generally, an appropriate portion (depending on the holding period of the OID Bond by each purchaser) of the total amount of original issue discount payable at the maturity of the OID bond will, upon disposition or payment of an OID Bond, be treated as a return of capital, rather than as taxable gain, for federal income tax purposes. The portion so treated will be determined by allocating the total original issue discount over the term of each OID Bond through a series of adjustments to the issue price for each accrual period. The adjustment to the issue price for each accrual period is determined by multiplying the issue price at the beginning of such accrual period (the issue price as increased by adjustments for all prior accrual periods) by the appropriate fraction of such OID Bond s original yield to maturity and subtracting any current interest payment thereon during such accrual period. Owners of OID Bonds should consult their own professional tax advisors as to the precise determination for federal income tax purposes for interest accrued on and original issue discount accrued with respect to such OID Bonds upon any purchase, sale, redemption or other disposition or payment of such OID Bonds, and as to the State and local tax consequences of owning such OID Bonds. BOND RATING Standard & Poor s Ratings Services, New York, New York ( S&P ) is expected to assign its credit rating of AA (stable) to the Bonds, with the understanding that, upon delivery of the Bonds, a Municipal Bond Insurance Policy will be issued by Build America Mutual Assurance Company. S&P has assigned its underlying rating of BBB+ (negative outlook) to the Bonds. Such ratings reflect only the view of such organization. Any desired explanation of the significance of such 28

34 ratings should be obtained from the rating agency furnishing the same, at the following address: Standard & Poor s Ratings Services, 55 Water Street, 38 th Floor, New York, NY There is no assurance that these credit ratings will be maintained for any given period of time, or that they may not be lowered or withdrawn entirely by the rating agency if, in its judgment, circumstances so warrant. Any such downward change in or withdrawal of such credit ratings may have an adverse effect on the market price of the Bonds. BOND UNDERWRITING The Bonds have been purchased by Janney Montgomery Scott LLC, Pittsburgh, Pennsylvania, as the Managing Underwriter. The Managing Underwriter has agreed to purchase the Bonds at an aggregate purchase price of $6,715,995.50, which is equal to the principal amount of the Bonds less underwriters discount in the amount of $54, and less net original issue discount in the amount of $199, The Bond Purchase Agreement for the Bonds provides that the Managing Underwriter will purchase all the Bonds, if any are purchased, in accordance with the terms of the Bond Purchase Agreement, and requires that the School District certify to the Managing Underwriter that this Official Statement does not, to the knowledge of the School District, contain any untrue statement of a material fact or omit any statement of any material fact necessary to make the statements herein, in light of the circumstances under which they were made, not misleading. The initial public offering prices of the Bonds, set forth in the BOND MATURITY SCHEDULE shown on the inside of the Cover Page of this Official Statement, may be changed by the Managing Underwriter from time to time without any requirement of prior notice. The Managing Underwriter reserves the right to join with other dealers in offering the Bonds to the public; and said Bonds offered to other dealers may be at prices lower than those offered to the public. MISCELLANEOUS MATTERS All summaries of the provisions of the Act, the Bonds, the Resolution, the Bond Purchase Agreement, the Disclosure Certificate, and other documents hereinabove and hereinafter set forth are made subject to all detailed provisions thereof, to which reference is hereby made for further information, and do not purport to be complete statements of any or all such provisions. All estimates and assumptions herein have been made on the best information available and are believed to be reliable, but no representations whatsoever are made that such estimates or assumptions are correct or will be realized. So far as any statements herein involve matters of opinion, whether or not expressly so stated, they are intended merely as such and not as representations of fact. Appendices A, B, and C, attached hereto, are expressly incorporated herein as a part hereof. This Official Statement, issued by the School District, has been duly approved and executed by the School District and has been authorized for distribution in connection with the underwriting and offering of the Bonds. WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) By: \s\ Phil Shar Phil Shar, President Board of School Directors 29

35 APPENDIX A DEMOGRAPHIC AND ECONOMIC DESCRIPTION OF WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania)

36 DEMOGRAPHIC AND ECONOMIC DESCRIPTION OF WEST MIFFLIN AREA SCHOOL DISTRICT (Allegheny County, Pennsylvania) Introduction West Mifflin Area School District, Allegheny County, Pennsylvania, (the School District ) is comprised of the Boroughs of West Mifflin and Whitaker (collectively, the Component Municipalities ). The two Component Municipalities of the School District are located in the south-central portion of Allegheny County, Pennsylvania (the County ), approximately ten miles south of the City of Pittsburgh, the county seat of the County. The School District is bordered to the north by the City of Pittsburgh, to the south by the Boroughs of Jefferson and Pleasant Hills, to the east by the City of Duquesne, and to the west by the Borough of Baldwin. The School District encompasses a combined land area of 14.5 square miles, serving a 2010 U.S. Census population of 21,584. Transportation The Allegheny County Municipal Airport, which serves both private and corporate aircraft, is located in the Component Municipality of West Mifflin Borough. Pittsburgh International Airport is located some twenty miles northwest of the School District. Pennsylvania State Routes 51, 837, and 885 provide excellent access to the City of Pittsburgh and other sections of the County. Public transportation is provided by the Port Authority of Allegheny County ( PAT ). Public Utilities and Services The School District is served by the following public utilities: Duquesne Light Company, Equitable Gas Company, Pennsylvania American Water, and Verizon. Additionally, West Mifflin Borough provides sanitary sewer service. Financial Institutions School District residents are served by branch offices of First National Bank and PNC Bank, National Association. Health Care and Emergency Services Jefferson Regional Health Center, which is the major health care facility of the South Hills Health System, is located some five miles south of the School District in Jefferson Borough. It provides quality health care from emergency admissions to inpatient hospitalization and leading edge surgery to rehabilitation and home care. St. Clair Memorial Hospital is located approximately five miles west of the School District in the Municipality of Mount Lebanon. The UPMC South Side Hospital lies some three miles northwest of the School District in the South Side section of the City of Pittsburgh, and UPMC McKeesport Hospital is located approximately five miles east of the School District in the City of McKeesport. Additionally, School District residents enjoy easy access to all of the major health care institutions that are located throughout the City of Pittsburgh. These include Allegheny General Hospital, West Penn Hospital, West Penn Forbes Regional Campus, and the University of Pittsburgh Medical Center, which includes Presbyterian University Hospital, Children s Hospital of Pittsburgh, Magee Women s Hospital, Western Psychiatric Institute & Clinic, Eye and Ear Hospital, Mercy Hospital and Shadyside Hospital. The two Component Municipalities each have paid police departments and volunteer fire departments. Ambulance and EMT services are provided by the Component Municipalities on a subscription basis to School District residents. Additionally, a successful Life-Flight helicopter service is available as needed to major Pittsburgh hospitals. Higher Education The South Campus of Community College of Allegheny County is located in the Borough of West Mifflin; the Penn State Greater Allegheny Campus lies approximately five miles east of the School District in the City of McKeesport. Due to the relatively close proximity of the area to the City of Pittsburgh, easy access is provided to such institutions as Carnegie- Mellon University, the University of Pittsburgh, Duquesne University, Chatham University, Carlow University, Point Park University, Robert Morris University, LaRoche College, and Pittsburgh Theological Seminary. In addition, numerous trade and technical schools are found in the Greater Pittsburgh vicinity. Communications The Greater Pittsburgh Metropolitan Area is served by numerous television stations, including KDKA (CBS), WPXI (NBC), WTAE (ABC), and WQED (Educational); cable television, offering numerous regular and premium programming channels, is provided to the area by Comcast Cable on a subscription basis. Numerous AM and FM radio stations are received throughout the area. The Pittsburgh Post-Gazette, Tribune Review, and the McKeesport Daily News are widely circulated on a daily basis, including Sunday. The Valley Mirror is also distributed throughout the region on a weekly basis. A-1

37 Recreation Kennywood Park, a major attraction and employer in the area, is located in West Mifflin Borough. This amusement park, which has been designated as a national historic landmark, attracts more than one million visitors annually from across the United States. The major attractions of Kennywood Park include three wooden roller coasters and some fifty other rides for both adults and children. Westwood Golf Club, which is a public facility, is also located in West Mifflin Borough. South Park, which is owned and operated by the County, lies some three miles southwest of the School District in South Park Township. South Park offers a wave pool, an eighteen-hole and a nine-hole golf course, ice-skating, tennis courts, walking and bicycle trails, miniature golf, and numerous picnic groves. ECONOMY OF THE SCHOOL DISTRICT The School District enjoys a diversified tax base and economy. The orientation of the economy has been transformed in recent years from heavy manufacturing to an emphasis on service, wholesale trade, and retail trade. Century III Mall, which lies in the Component Municipality of West Mifflin Borough, is the third largest shopping mall located in the Pittsburgh region. Century III features more than 130 stores and restaurants over an area of some million square feet. Anchor tenants of the Mall are three major department Stores, including Macy s, Sears, and J.C. Penney. Additional retail outlets which are adjacent to Century III include: Busy Beaver, Giant Eagle, Wal-Mart, and Shop n Save. Other features of these properties include a cinema, and many restaurants. In addition to Century III, four additional shopping centers are also located in West Mifflin Borough. These include Kennywood Mall, Duquesne Village, Century Square and Mifflin Manor. Two of the major employers that are located in West Mifflin Borough include the Irvin Works of USX Corporation and the Bettis Atomic Power and Research Laboratory of Westinghouse Electric Corporation. The Irvin Works processes sheet metal for use in automobiles and major appliances. Bettis is a research and development laboratory engaged exclusively in federal contracting work with both the United States Navy and the Department of Energy. District. The following table depicts the larger employers that are located both within and in close proximity to the School Employer Number of Local Employees United States Steel Corporation 1,122 Bechtel Bettis Inc. 1,036 Kennywood Park Corporation 705 Bombardier Transportation 603 West Mifflin Area School District 385 Wal-Mart Associates Inc. 277 Port Authority of Allegheny County 240 Giant Eagle Incorporated 234 Community College of Allegheny County 204 A-2

38 The School District is part of the Pittsburgh Metropolitan Statistical Area ( MSA ) with respect to employment and unemployment data. Presented below are certain statistical comparisons relating to employment and earnings in the MSA, the Commonwealth, and the United States. NON-AGRICULTURAL PAYROLL DATA - - PITTSBURGH MSA AND THE COMMONWEALTH OF PENNSYLVANIA (IN THOUSANDS) Pittsburgh MSA Commonwealth of PA Oct. Sept. Oct. Oct. Sept. Oct. Employment Category: Mining and Logging Construction Manufacturing Trade, Transportation and Utilities , , , Information Financial Activities Professional and Business Services Education and Health Services , , , Leisure and Hospitality Other Services Government Total 1, , , , , , SOURCE: U.S. Department of Labor, Bureau of Labor Statistics. ALLEGHENY COUNTY AND THE COMMONWEALTH OF PENNSYLVANIA EMPLOYEES, ESTABLISHMENTS AND PAYROLL DATA Allegheny County Annual Number of Number of Payroll Year Establishments Employees ( $ 000 ) , ,057 $ 29,530, , ,099 29,977,831 Commonwealth of Pennsylvania Annual Number of Number of Payroll Year Establishments Employees ( $ 000 ) ,432 5,044,648 $ 209,778, ,023 4,976, ,638,083 SOURCE: U.S. Bureau of Census, County Business Patterns. A-3

39 COMPARATIVE PER CAPITA PERSONAL INCOME TRENDS Percent of Change Political Subdivision Pittsburgh MSA $ 41,055 $ 42,617 $ 44, % Allegheny County 44,782 46,510 48, % Commonwealth of Pennsylvania 39,210 40,444 42, % United States 38,637 39,791 41, % SOURCE: U.S. Department of Commerce, Bureau of Economic Analysis. COMPARATIVE PERSONAL INCOME TRENDS (Millions of Dollars) Percent of Change Political Subdivision Pittsburgh MSA $ 96,702 $ 100,489 $ 106, % Allegheny County 54,731 56,967 59, % Commonwealth of Pennsylvania 496, , , % United States 11,852,715 12,308,496 12,949, % SOURCE: U.S. Department of Commerce, Bureau of Economic Analysis. COMPARATIVE SUMMARY OF GENERAL POPULATION CHARACTERISTICS 2010 U.S. CENSUS Age 2010 U.S. % 65 Number of Census % Under and Number of Persons Per Number of Political Subdivision Population 18 over Households Household Families West Mifflin Borough 20, % 19.50% 8, ,661 Whitaker Borough 1, % 15.60% Total 21,584 9,347 6,005 Allegheny County 1,223, % 16.80% 533, ,009 Commonwealth of Pennsylvania 12,702, % 15.40% 5,018, ,261,307 SOURCE: The Pennsylvania State University Data Center. A-4

40 COMPARATIVE SUMMARY OF GENERAL HOUSING CHARACTERISTICS 2010 U.S. CENSUS Occupied Housing Units Owner Total Total Occupied Occupied % Housing Housing Housing Owner Political Subdivision Units Units Units Occupied West Mifflin Borough 9,462 6,871 8, % Whitaker Borough % Total 10,068 7,244 9,347 - Allegheny County 589, , , % Commonwealth of Pennsylvania 5,567,315 3,491,722 5,018, % SOURCE: The Pennsylvania State University Data Center. A-5

41 PITTSBURGH MSA, ALLEGHENY COUNTY AND THE COMMONWEALTH OF PENNSYLVANIA COMPARATIVE CIVILIAN LABOR FORCE DATA (In Thousands) Nov. Percent of Change Pittsburgh MSA Civilian Labor Force 1, , , , , , , , , % Employment 1, , , , , , , , , % Unemployment % Rate of Unemployment 5.50% 4.60% 4.20% 4.40% 6.00% 7.80% 7.50% 6.60% 6.50% - Allegheny County Civilian Labor Force % Employment % Unemployment % Rate of Unemployment 4.80% 4.20% 3.90% 4.10% 5.50% 7.20% 7.10% 6.20% 6.20% - Commonwealth of PA Civilian Labor Force 6,333 6,288 6,329 6,335 6,418 6,294 6,331 6,322 6, % Employment 6,007 6,013 6,068 6,061 6,005 5,759 5,821 5,865 6, % Unemployment % Rate of Unemployment 5.20% 4.40% 4.10% 4.30% 6.40% 8.50% 8.10% 7.20% 7.30% - A-6

42 APPENDIX B FORM OF OPINION OF BOND COUNSEL

43

44

45

46 APPENDIX C SPECIMEN MUNICIPAL BOND INSURANCE POLICY

47 MUNICIPAL BOND INSURANCE POLICY ISSUER: [NAME OF ISSUER] Policy No: MEMBER: [NAME OF MEMBER] BONDS: $ in aggregate principal amount of [NAME OF TRANSACTION] [and maturing on] Effective Date: Risk Premium: $ Member Surplus Contribution: $ BUILD AMERICA MUTUAL ASSURANCE COMPANY ( BAM ), for consideration received, hereby UNCONDITIONALLY AND IRREVOCABLY agrees to pay to the trustee (the Trustee ) or paying agent (the Paying Agent ) for the Bonds named above (as set forth in the documentation providing for the issuance and securing of the Bonds), for the benefit of the Owners or, at the election of BAM, directly to each Owner, subject only to the terms of this Policy (which includes each endorsement hereto), that portion of the principal of and interest on the Bonds that shall become Due for Payment but shall be unpaid by reason of Nonpayment by the Issuer. On the later of the day on which such principal and interest becomes Due for Payment or the first Business Day following the Business Day on which BAM shall have received Notice of Nonpayment, BAM will disburse (but without duplication in the case of duplicate claims for the same Nonpayment) to or for the benefit of each Owner of the Bonds, the face amount of principal of and interest on the Bonds that is then Due for Payment but is then unpaid by reason of Nonpayment by the Issuer, but only upon receipt by BAM, in a form reasonably satisfactory to it, of (a) evidence of the Owner s right to receive payment of such principal or interest then Due for Payment and (b) evidence, including any appropriate instruments of assignment, that all of the Owner s rights with respect to payment of such principal or interest that is Due for Payment shall thereupon vest in BAM. A Notice of Nonpayment will be deemed received on a given Business Day if it is received prior to 1:00 p.m. (New York time) on such Business Day; otherwise, it will be deemed received on the next Business Day. If any Notice of Nonpayment received by BAM is incomplete, it shall be deemed not to have been received by BAM for purposes of the preceding sentence, and BAM shall promptly so advise the Trustee, Paying Agent or Owner, as appropriate, any of whom may submit an amended Notice of Nonpayment. Upon disbursement under this Policy in respect of a Bond and to the extent of such payment, BAM shall become the owner of such Bond, any appurtenant coupon to such Bond and right to receipt of payment of principal of or interest on such Bond and shall be fully subrogated to the rights of the Owner, including the Owner s right to receive payments under such Bond. Payment by BAM either to the Trustee or Paying Agent for the benefit of the Owners, or directly to the Owners, on account of any Nonpayment shall discharge the obligation of BAM under this Policy with respect to said Nonpayment. Except to the extent expressly modified by an endorsement hereto, the following terms shall have the meanings specified for all purposes of this Policy. Business Day means any day other than (a) a Saturday or Sunday or (b) a day on which banking institutions in the State of New York or the Insurer s Fiscal Agent (as defined herein) are authorized or required by law or executive order to remain closed. Due for Payment means (a) when referring to the principal of a Bond, payable on the stated maturity date thereof or the date on which the same shall have been duly called for mandatory sinking fund redemption and does not refer to any earlier date on which payment is due by reason of call for redemption (other than by mandatory sinking fund redemption), acceleration or other advancement of maturity (unless BAM shall elect, in its sole discretion, to pay such principal due upon such acceleration together with any accrued interest to the date of acceleration) and (b) when referring to interest on a Bond, payable on the stated date for payment of interest. Nonpayment means, in respect of a Bond, the failure of the Issuer to have provided sufficient funds to the Trustee or, if there is no Trustee, to the Paying Agent for payment in full of all principal and interest that is Due for Payment on such Bond. Nonpayment shall also include, in respect of a Bond, any payment made to an Owner by or on behalf of the Issuer of principal or interest that is Due for Payment, which payment has been recovered from such Owner pursuant to the United States Bankruptcy Code in accordance with a final, nonappealable order of a court having competent jurisdiction. Notice means delivery to BAM of a notice of claim and certificate, by certified mail, or telecopy as set forth on the attached Schedule or other acceptable electronic delivery, in a form satisfactory to BAM, from and signed by an Owner, the Trustee or the Paying Agent, which notice shall specify (a) the person or entity making the claim, (b) the Policy Number, (c) the claimed amount, (d) payment instructions and (e) the date such claimed amount becomes or became Due for Payment. Owner means, in respect of a Bond, the person or entity who, at the time of Nonpayment, is entitled under the terms of such Bond to payment thereof, except that Owner shall not include the Issuer, the Member or any other person or entity whose direct or indirect obligation constitutes the underlying security for the Bonds.