$96,300,000* WISCONSIN HOUSING AND ECONOMIC DEVELOPMENT AUTHORITY

Transcription

1 This Preliminary Official Statement and information contained herein are subject to completion, amendment or other change without notice. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, qualification or filing under the applicable securities laws of such jurisdiction. NEW ISSUE (Book Entry only) PRELIMINARY OFFICIAL STATEMENT DATED november 21, 2017 This Official Statement has been prepared by the Wisconsin Housing and Economic Development Authority to provide information on its Housing Revenue Bonds, 2017 Series A Bonds (the Series A Bonds ) and Housing Revenue Bonds, 2017 Series B Bonds (the Series B Bonds and, together with the 2017 Series A Bonds, the Series Bonds ). Selected information is presented on this cover page for the convenience of the user. To make an informed decision, a prospective investor should read this Official Statement in its entirety. Dated Date: Due: Bond Ratings: Purpose: Tax Considerations: Security: Tender for Purchase: Redemption: Interest Payment Dates: Interest Rates: Closing: Bond Counsel: Underwriter Counsel: Trustee/Paying Agent: December, 2017 * Preliminary; subject to change. $96,300,000* WISCONSIN HOUSING AND ECONOMIC DEVELOPMENT AUTHORITY HOUSING REVENUE BONDS $92,875,000* 2017 Series A (Non-AMT) $3,425,000* 2017 Series B (Non-AMT) Date of delivery. As shown on the inside front cover. All Bonds (as defined herein) issued under the General Resolution (as defined herein) are rated Aa3 by Moody s and AA by S&P. See RATINGS herein. Proceeds of the Series Bonds will be used to fund Mortgage Loans secured by multifamily housing projects, to make a deposit into the Capital Reserve Fund and to pay a portion of the costs of issuance of the Series Bonds. See INTRODUCTION and ESTIMATED SOURCES AND USES OF FUNDS herein. In the opinion of Bond Counsel, assuming the accuracy of certain representations and continuing compliance with certain restrictions, conditions, requirements, covenants and agreements which are intended to ensure compliance with Section 103 of the Internal Revenue Code of 1986, as amended (the Code ) and the applicable provisions of Sections 141 through 150 of the Code, and subject to the exceptions described herein, under existing laws, regulations, rulings and judicial decisions, (i) interest on the Series Bonds is excluded from the gross income of the owners thereof for federal income tax purposes pursuant to Section 103 of the Internal Revenue Code of 1986, as amended (the Code ), except that interest on any Series A Bonds is not excludable from gross income for any period during which it is held by a substantial user (as defined in Section 147(a) of the Code) of certain projects financed by the Series A Bonds or by a related person (as defined in Section 147(a) of the Code) of such a substantial user, (ii) interest on the Series B Bonds is not a specific preference item for purposes of calculating the federal alternative minimum tax provisions of the Code applicable to individuals, corporations or other taxpayers, but such interest is included in the calculation of adjusted earnings of corporations for purposes of the federal alternative minimum tax and (iii) interest on the Series A Bonds is not a specific preference item for purposes of calculating the federal alternative minimum tax provisions of the Code applicable to individuals, corporations or other taxpayers and will not be included in the calculation of adjusted current earnings of corporations for purposes of calculating the federal alternative minimum tax. In the opinion of Bond Counsel, interest on the Series Bonds is exempt from Wisconsin income taxes. See TAX CONSIDERATIONS herein. The Series Bonds are general obligations of the Authority. The Series Bonds are secured by a pledge of certain collateral, as described herein under SECURITY FOR THE BONDS, including revenues from Mortgage Loans made by the Authority. The Series Bonds are secured on a parity with other Housing Revenue Bonds issued by the Authority under the General Resolution (defined herein). The Series Bonds are secured by a Capital Reserve Fund which is subject to replenishment by a moral obligation pledge of the State of Wisconsin. The State of Wisconsin is not liable on the Series Bonds. The Series A Bonds issued in the principal amount of $20,755,000* and maturing on November 1, 2047* (the 2047 Term Rate Bonds ) are subject to mandatory tender on May 1, 2020*, provided that the Authority may elect that all or certain 2047 Term Rate Bonds will not be subject to mandatory tender on such date or a subsequent mandatory tender date, if applicable, under the circumstances described herein. See THE SERIES BONDS Scheduled Mandatory Tender of 2047 Term Rate Bonds and THE SERIES BONDS Subsequent Mandatory Tender of 2047 Term Rate Bonds. The Series Bonds are subject to redemption prior to maturity, including redemption at par. May 1 and November 1, commencing May 1, See THE SERIES BONDS Interest Provisions herein The interest rate on the Series Bonds is shown on the inside front cover. On or about December, 2017, via The Depository Trust Company. See THE SERIES BONDS Bonds in Book-Entry Form herein. Kutak Rock LLP. Dinsmore & Shohl LLP. Wells Fargo Bank, National Association. bofa Merrill Lynch J.P. Morgan Cabrera Capital Markets, LLC

2 MATURITY SCHEDULE * $92,875,000 * SERIES A BONDS (Non-AMT) Date Principal Interest Rate CUSIP November 1, 2018 $ 265,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 May 1, ,000 November 1, ,000 Price of 2017 Series A Serial Bonds % $6,350,000 % Term Bond Due November 1, 2032 at % (CUSIP ) $9,260,000 % Term Bond Due November 1, 2037 at % (CUSIP ) $7,675,000 % Term Bond Due November 1, 2042 at % (CUSIP ) $13,440,000 % Term Bond Due November 1, 2047 at % (CUSIP ) $20,755,000 % 2047 Term Rate Bond Due November 1, 2047 at % (CUSIP ) $22,430,000 % Term Bond Due May 1, 2055 at % (CUSIP ) $3,425,000 * SERIES B BONDS (Non-AMT) $3,425,000 % Term Bond Due November 1, 2042 at % (CUSIP ) * Preliminary; subject to change. CUSIP numbers have been assigned by an organization not affiliated with the Authority and are included for the convenience of the owners of the Series Bonds. The Authority is not responsible for the selection or uses of these CUSIP numbers, nor is any representation made as to their correctness on the Series Bonds or as indicated above. A CUSIP number for a specific maturity may be changed after the issuance date. CUSIP is a registered trademark of the American Bankers Association. Initial Interest Rate in effect prior to the Scheduled Mandatory Tender Date (defined herein as May 1, 2020).

3 No dealer, broker, sales representative or other person has been authorized by the Wisconsin Housing and Economic Development Authority or the Underwriters to give any information or to make any representations, other than those contained in this Official Statement, and if given or made, such other information or representation must not be relied upon as having been authorized by any of the foregoing. 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 Series Bonds by any person in any state in which it is unlawful for such person to make such offer, solicitation or sale. The Wisconsin Housing and Economic Development Authority is the author of this Official Statement and is responsible for its accuracy and completeness. The Underwriters are not the author of this Official Statement. In accordance with their responsibilities under federal securities laws, the Underwriter is required to review the information in this Official Statement and must have a reasonable basis for their belief in the accuracy and completeness of the Official Statement s key representations. The information set forth in this Official Statement, however, is not guaranteed as to accuracy or completeness by the Underwriters. 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 the affairs of the Wisconsin Housing and Economic Development Authority or other information or opinions expressed herein since the date hereof. The Series Bonds have not been registered with the Securities and Exchange Commission, by reason of the provisions of Section 3(a) (2) of the Securities Act of 1933, as amended. The registration or qualification of the Series Bonds in accordance with provisions of securities laws of the states in which the Series Bonds have been registered or qualified, and the exemption from registration or qualification in other states shall not be regarded as a recommendation thereof. Neither these states, nor any of their agencies, have passed upon the merits of the Series Bonds or the accuracy or completeness of this Official Statement. Any representation to the contrary may be a criminal offense. In making an investment decision investors must rely on their own examination of the Wisconsin Housing and Economic Development Authority and the terms of the offering, including the merits and risks involved. These securities have not been recommended by any federal or state securities commission or regulatory authority. Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of this document. Any representation to the contrary may be a criminal offense.

4 TABLE OF CONTENTS INTRODUCTION... 1 THE AUTHORITY... 3 Statutory Authority... 3 Programs... 3 Organization... 3 Financial Statements of the Authority... 5 SWAP AGREEMENTS... 5 SECURITY FOR THE BONDS... 6 Pledge of the General Resolution... 6 Capital Reserve Fund... 7 Restrictions on Transfers of Moneys to Authority Surplus Account... 8 THE SERIES BONDS... 8 General... 8 Interest Provisions... 8 Scheduled Mandatory Tender of 2047 Term Rate Bonds... 9 Subsequent Mandatory Tender of 2047 Term Rate Bonds... 9 Redemption Provisions Bonds in Book-Entry Form SOURCES AND USES OF FUNDS FEDERAL ASSISTANCE PROGRAMS General Section 8 Subsidy Program Rural Rental Assistance MORTGAGE LOAN UNDERWRITING MORTGAGE LOAN SERVICING The Mortgage Loan Portfolio Assisted Developments (Section 8, Section 236 and Rural Rental Assistance) Unassisted Developments For Profit Mortgagors Unassisted Developments Not For Profit Mortgagors AGREEMENT OF THE STATE LEGAL MATTERS TAX CONSIDERATIONS Series Bonds UNDERWRITING RATINGS FINANCIAL STATEMENTS OF THE AUTHORITY CONTINUING DISCLOSURE MISCELLANEOUS EXHIBIT A Multifamily Developments Financed by the Authority s Housing Revenue Bonds by Project; Multifamily Developments to be Funded by the 2017 Series A and 2017 Series B Bonds... A-1 EXHIBIT B Financial Statements of the Authority... B-1 EXHIBIT C Outstanding Bonds and Notes of the Authority... C-1 EXHIBIT D Summary of Certain Provisions of the General Resolution... D-1 EXHIBIT E Proposed Form of Opinion of Bond Counsel... E-1 Page

5 OFFICIAL STATEMENT $96,300,000 * WISCONSIN HOUSING AND ECONOMIC DEVELOPMENT AUTHORITY HOUSING REVENUE BONDS $92,875,000 * 2017 Series A (Non-AMT) $3,425,000 * 2017 Series B (Non-AMT) INTRODUCTION The purpose of this Official Statement is to set forth information concerning the Wisconsin Housing and Economic Development Authority ( Authority ) in connection with the sale of its $92,875,000 * Housing Revenue Bonds, 2017 Series A (the Series A Bonds ) and $3,425,000 * Housing Revenue Bonds, 2017 Series B (the Series B Bonds and, together with the Series A Bonds, the Series Bonds ). Information set forth on the cover and inside cover pages hereof and in the exhibits hereto is part of this Official Statement. All capitalized terms used in this Official Statement and not otherwise defined herein have the meanings set forth in the Housing Revenue Bond Resolution adopted by the Authority on March 12, 1974, as amended and restated on March 15, 2002, and as supplemented on December 3, 2007 (the General Resolution ). The General Resolution authorizes the issuance of the Bonds. Eighty-two series of Bonds (collectively, the Prior Bonds ) in the aggregate amount of $1,689,870,000, of which $354,485,000 are outstanding as of June 30, 2017, have been issued previously pursuant to the General Resolution. See EXHIBIT C OUTSTANDING BONDS AND NOTES OF THE AUTHORITY. The Prior Bonds are on a parity with the Series Bonds. The Series Bonds and any other bonds which have been or may be issued under the General Resolution are herein referred to as the Bonds. The General Resolution authorizes the issuance of an unlimited amount of additional bonds on a parity with the Bonds, equally and ratably secured by the General Resolution, upon satisfaction of the conditions to issuance set forth therein. Wells Fargo Bank, National Association, will act as Trustee (the Trustee ) under the General Resolution. The Series Bonds are authorized to be issued pursuant to Chapter 234, Wisconsin Statutes, as amended (the Statute ), the General Resolution, the Series Resolution Authorizing the Issuance of Wisconsin Housing and Economic Development Authority Housing Revenue Bonds, which was adopted by the Authority on August 16, 2017 and amended and restated on November 20, 2017 (the Series Resolution ) and a related Closing Certificate dated the date of delivery of the Series Bonds (the Closing Certificate ). The Authority currently expects to issue its Housing Revenue Bonds, 2017 Series C (Variable Rate) in an amount not to exceed $20,000,000 simultaneously with the issuance of the Series Bonds. The 2017 Series C Bonds are neither offered by, nor described in, this Official Statement. Proceeds of the Series Bonds will be used to fund Mortgage Loans secured by multifamily housing projects, to make a deposit into the Capital Reserve Fund and to pay a portion of the costs of issuance of the Series Bonds. (See EXHIBIT A MULTIFAMILY DEVELOPMENTS FINANCED BY THE AUTHORITY S HOUSING REVENUE BONDS BY PROJECT; MULTIFAMILY DEVELOPMENTS TO BE FINANCED BY SERIES BONDS ). The Prior Bonds have financed 232 long-term mortgage loans (the Mortgage Loans ) for 11,639 units in 187 developments. (See EXHIBIT A for information relating to the multifamily housing developments financed by the proceeds of Prior Bonds.) 50 of the previously financed developments are subject to housing assistance payments under Section 8 of the United States Housing Act of 1937, as amended (the Section 8 Subsidy Program ). The remaining 137 of the previously financed developments receive no direct federal assistance. Each Mortgage Loan is secured by a first mortgage on the applicable real estate which is required to have priority over all liens except tax and special assessment liens filed after recording of the mortgage. The aggregate outstanding * Preliminary; subject to change. 1

6 balance on Mortgage Loans funded by the Prior Bonds issued under the General Resolution was $415,254,084 as of June 30, The Bonds are general obligations of the Authority, subject to provisions of resolutions heretofore and hereafter adopted pledging particular assets or revenues of the Authority to other notes or bonds. Substantially all the assets and revenues of the Authority have been pledged to the payment of specific issues of bonds and notes outstanding under its various resolutions. Most of the outstanding bonds and notes of the Authority shown in EXHIBIT C OUTSTANDING BONDS AND NOTES OF THE AUTHORITY are also general obligations of the Authority, except as indicated therein. The Authority is required by Statute to annually prepare and submit for approval by the Governor and the Legislature a plan for expending and encumbering that portion of its assets defined as surplus by the Statute. Pursuant to the General Resolution, there are or will be pledged, for the payment of the principal or Redemption Price of and interest on the Bonds, a Capital Reserve Fund, the Revenues, the Mortgage Loans and all funds and accounts established by the General Resolution, except for certain funds and accounts specifically excepted from such pledge. See SECURITY FOR THE BONDS Pledge of the General Resolution for a description of the Revenues and EXHIBIT D SUMMARY OF CERTAIN PROVISIONS OF THE GENERAL RESOLUTION for a description of funds and accounts. The 2047 Term Rate Bonds will initially bear interest in a term rate mode (the Term Rate Mode ) as described herein. The 2047 Term Rate Bonds are subject to mandatory tender for purchase (with no right to retain) on May 1, 2020 * (the Scheduled Mandatory Tender Date ) and on any subsequent mandatory tender date established by the Authority (each a Subsequent Mandatory Tender Date and together with the Scheduled Mandatory Tender Date a Mandatory Tender Date ) at a price equal to 100% of the principal amount thereof plus accrued interest thereon to the date of purchase provided that the Authority may elect that all or certain 2047 Term Rate Bonds will not be subject to mandatory tender on such dates, as described below. See THE SERIES BONDS Scheduled Mandatory Tender of 2047 Term Rate Bonds and THE SERIES BONDS Subsequent Mandatory Tender of 2047 Term Rate Bonds. The purchase price of the 2047 Term Rate Bonds tendered for purchase by the registered owners thereof as described herein will be payable (i) from the proceeds of the remarketing thereof, if the Authority elects to remarket the 2047 Term Rate Bonds on a Mandatory Tender Date and (ii) any other funds the Authority elects to make available for such purposes. If the Authority elects not to remarket all 2047 Term Rate Bonds on a Mandatory Tender Date and elects not to make other funds available for the purchase of the 2047 Term Rate Bonds, the Authority will determine the aggregate principal amount of 2047 Term Rate Bonds that will and will not be purchased on the applicable Mandatory Tender Date. The 2047 Term Rate Bonds not purchased on the applicable Mandatory Tender Date will bear interest at a rate of 10% * per annum from the applicable Mandatory Tender Date to the earliest of (i) maturity, (ii) the date of redemption of such 2047 Term Rate Bonds, or (iii) the date that such 2047 Term Rate Bonds are remarketed to new purchasers. The 2047 Term Rate Bonds do not, nor are there currently any requirements or assurance that the 2047 Term Rate Bonds will, have the benefit of a liquidity or other credit facility to pay the purchase price of the 2047 Term Rate Bonds on the applicable Mandatory Tender Date. As a result, all Bondholders of the 2047 Term Rate Bonds (including those subject to mandatory tender on a Mandatory Tender Date and not purchased) may be required to hold their 2047 Term Rate Bonds until maturity or prior redemption. * Preliminary; subject to change. 2

7 THE AUTHORITY Statutory Authority In 1972, the Wisconsin Legislature enacted legislation establishing the Authority as a public body corporate and politic to provide an adequate supply of housing for persons and families of low and moderate income. Chapter 234 of the Wisconsin Statutes (the Statute ) authorizes the Authority, among other things, to (i) purchase mortgages and securities the proceeds of which are utilized for the purpose of providing residential housing for occupancy by persons and families of low and moderate income, (ii) make or participate in the making of loans to eligible sponsors of housing developments for the construction or rehabilitation of housing, and (iii) make or participate in the making of long-term mortgage loans to eligible sponsors of housing developments and directly to persons and families of low and moderate income, in each case upon a determination by the Authority that construction loans or long-term mortgage loans are not otherwise available from private lenders upon reasonably equivalent terms and conditions. The Supreme Court of the State of Wisconsin has held that the legislation which established the Authority is a constitutional enactment evidencing both a public and statewide purpose. State ex rel. Warren v. Nusbaum, 59 Wis. 2d 391, 208 N.W.2d 780 (1973). The Statute was amended in 1976 to permit the Authority to make or participate in making loans to banking institutions for the purpose of making long-term mortgage loans to, or to provide residential housing for, persons of low and moderate income. The Statute was amended in 1983 and in 1986 to permit the Authority to issue its negotiable bonds and notes to finance (i) economic development projects, and (ii) group homes and other housing with services and facilities for the elderly and disabled. The Statute was further amended in 1985 and subsequent years to permit the Authority to administer various State Guaranty Loan Programs. Programs The Authority has various other programs in addition to the Housing Revenue Bond Program described herein. Among these are its: (i) Multifamily Mortgage Loan Program, under which the Authority provides longterm mortgage loans for multifamily housing developments on a stand alone basis, (ii) Home Ownership Mortgage Loan Program, under which the Authority provides long-term mortgage loans to low-income to moderate-income homebuyers; (iii) Home Improvement Loan Program, for the purpose of making loans for home rehabilitation purposes; (iv) Economic Development Bond Program, for the purpose of financing economic development projects; and (v) Beginning Farmer Bond Program, to assist beginning farmers with the purchase of land and depreciable property. See EXHIBIT B FINANCIAL STATEMENTS OF THE AUTHORITY ALL PROGRAMS and EXHIBIT C OUTSTANDING BONDS AND NOTES OF THE AUTHORITY. The Authority also operates various small business and agricultural guaranty loan programs supported by reserves appropriated by the Wisconsin Legislature. Should such reserves be insufficient to fund the guaranties, the State of Wisconsin is morally obligated to replenish the reserves. Since 1985, the Authority has administered a Grant Program, funded with Authority reserves, for the purpose of making grant awards to local governments, housing authorities and nonprofit groups for various types of projects designed to improve and increase housing opportunities for low- and moderate-income families, elderly, handicapped or disabled persons, and persons in crisis. Organization The Authority has a governing body of twelve Members, which consists of the Chief Executive Officer of the Wisconsin Economic Development Corporation or his designee, the Secretary of the Department of Administration or his designee, a representative of each party from the Wisconsin State Assembly and the State Senate who are appointed in the same manner as the members of standing committees in their respective houses, and six public Members appointed to four year terms by the Governor of Wisconsin with the consent of the State Senate. The powers of the Authority, as defined in the Statute, are vested in and exercised by a majority of its Members then in office. The Authority may delegate any of its powers or duties to one or more of its Members or agents or, with the consent of its Executive Director, to its employees. The Governor of Wisconsin appoints the Chairperson for a one year term from among the public Members. The Executive Director is appointed by the Governor of Wisconsin for a two year term subject to State Senate confirmation. There is currently one vacancy on the Authority s governing body. 3

8 As of June 30, 2017, the Authority had a staff of 147 persons. In addition to the Executive Director and his office, the Authority has ten groups (Human Resources and Administration, Single Family Housing, Commercial Lending, Risk and Compliance, Finance, Information Technology, Legal, Communications, Strategic Business Development and Business and Community Engagement). In addition to its ten group directors, the Authority also employs accounting, economic development, housing development, financial, administrative, legal, marketing and management personnel. The Authority also contracts for the use of additional consultants and related personnel. The Authority s principal office is located at 201 West Washington Avenue, Suite 700, Madison, Wisconsin Its mailing address is P.O. Box 1728, Madison, Wisconsin , and its telephone number is (608) The Members of the Authority are: Ivan Gamboa, Chairperson Term Expires January 1, 2019 Bradley Guse, Vice Chair Term Expires January 1, 2018 John Horning, Treasurer Term Expires January 1, 2019 Sue Shore, Secretary Term Expires January 1, 2020 Mark R. Hogan Chief Executive Officer of the Wisconsin Economic Development Corporation Senator Janet Bewley Serves at the pleasure of the State Senate Senator Alberta Darling Serves at the pleasure of the State Senate McArthur Weddle Term Expires January 1, 2020 Representative Scott Allen Serves at the pleasure of the State Assembly Representative Evan Goyke Serves at the pleasure of the State Assembly Cate Zeuske Deputy Secretary of the Department of Administration, designee of the Secretary of the Department of Administration Senior Vice President, Tri-City National Bank Hales Corners, Wisconsin Vice Chair, BMO Harris Bank N.A. Arpin, Wisconsin Executive Vice President, Shorewest Realtors Brookfield, Wisconsin Retired, Town of Maine Supervisor Wausau, Wisconsin Wisconsin Economic Development Corporation Madison, Wisconsin State Senate, State Capitol Madison, Wisconsin State Senate, State Capitol Madison, Wisconsin Executive Director, Northcott Neighborhood House Milwaukee, Wisconsin State Assembly, State Capitol Madison, Wisconsin State Assembly, State Capitol Madison, Wisconsin Wisconsin Department of Administration Madison, Wisconsin Staff of the Authority include: Wyman B. Winston, Executive Director Governor Scott Walker appointed Wyman B. Winston as the Authority s Executive Director effective January 3, Mr. Winston spent 14 years at the Authority as a Senior Manager, first in Multifamily and later heading the Emerging Markets Group. He launched the Low Income Housing Tax Credit (LIHTC) program at its inception, worked on solving challenges to preserve the Authority s oldest housing portfolio and prepared the initial proposal for the Authority to participate in the federal New Markets Tax Credit (NMTC) program. 4

9 Outside of the Authority, Mr. Winston spent 10 years at other redevelopment authorities and accomplished the following: operated the first retail and job creation Tax Increment Financing in Atlanta, Georgia; launched the City of Atlanta s NMTC programs; managed a big city redevelopment agency with an annual budget of over $250 million; established major NMTC programs in Portland, Oregon; and headed a city housing finance department. Sherry Gerondale, Chief Financial Officer Sherry Gerondale was named Chief Financial Officer at the Authority in February Ms. Gerondale has been with the Authority since 1989 and served most recently as the Treasury Manager. Ms. Gerondale s industry expertise includes directing the issuance of tax-exempt and taxable bonds, negotiation of other debt instruments, debt monitoring and compliance, oversight of the Authority s credit rating, maintaining the investment portfolio and new product development. Ms. Gerondale holds a Bachelors of Business Administration in Finance and Masters of Science in Accounting from the University of Wisconsin Whitewater. Sean O Brien, Director, Commercial Lending In 2006, Mr. O Brien joined WHEDA as an Asset Manager in the Multifamily Housing division where he managed a portfolio of over $100 million in assets. At that time, he was also responsible for managing the compliance functions of the company s NMTC program. In 2011, Mr. O Brien joined the credit team as a Senior Underwriter where he was responsible for allocating both the 9% and 4% Federal Low Income Housing Tax Credits on an annual basis as well as loan origination and underwriting. Mr. O Brien has underwritten and closed over $105 million in Multifamily Lending using taxable and tax-exempt bonds for construction lending as well as permanent financing. In 2014, Mr. O Brien accepted a promotion to Director of Commercial Lending. His new duties will include overseeing both Multifamily and Commercial Participation lending, NMTC transaction underwriting and closing, Federal Low Income Housing Tax Credit policy and allocating, as well as commercial loan guarantees and the SSBCI program. Mr. O Brien received a B.S. in Business Administration from the University of Wisconsin, Madison. Financial Statements of the Authority The Authority s financial statements included in this Official Statement as EXHIBIT B, as of and for the fiscal year ended June 30, 2017, are presented in combined Authority-wide form followed by fund financial statements presented for its major funds in order to comply with the requirements of Statement No. 34 of the Governmental Accounting Standards Board. SWAP AGREEMENTS The Authority has previously entered into, and may in the future enter into additional, variable to fixed interest rate swap agreements (the Swap Agreements ) with various swap counterparties (the Swap Providers ). In general, the Swap Agreements provide that, subject to the terms and conditions thereof, the Swap Provider will pay to the Trustee a floating amount based on variable rate indices and the Authority will pay the Swap Provider a fixed amount, in each case with reference to a notional amount as specified in the applicable swap agreement. The amounts payable to the Swap Provider under the Swap Agreements, other than termination payments, are secured by the pledge of the General Resolution on a parity basis with the Bonds, and amounts payable to the Trustee will be deemed to be Revenues under the General Resolution. The obligation of the Authority to make termination payments to the Swap Provider under the Swap Agreements is a general unsecured obligation of the Authority. See Note 7 to the financial statements of the Authority set forth in EXHIBIT B for additional information on the Swap Agreements, and for information on other swap agreements of the Authority entered into outside the General Resolution with respect to other bonds of the Authority. Under certain circumstances, the Swap Agreements are subject to termination prior to the maturity of the Bonds to which they relate and prior to the scheduled termination date thereof. In the event of an early termination of a Swap Agreement, there can be no assurance that (i) the Authority will receive any termination payment payable to it by the Swap Provider, (ii) the Authority will have sufficient amounts to make a termination payment payable by it to the Swap Provider, or (iii) the Authority will be able to obtain a replacement swap agreement with comparable terms. Payments due upon early termination may be substantial. 5

10 The Authority is obligated to make debt service payments on the Bonds regardless of the performance of the Swap Provider of its obligations under the Swap Agreements. The agreement by the Swap Provider to pay amounts to the Authority under the Swap Agreements does not affect the Authority s obligation to pay the principal of, premium, if any, and interest on the related Bonds. Neither the holders of such Bonds nor any other person other than the Authority will have any rights under any Swap Agreement or against the Swap Provider. Pledge of the General Resolution SECURITY FOR THE BONDS The Bonds are general obligations of the Authority, subject to the provisions of resolutions heretofore and hereafter adopted pledging particular assets or revenues of the Authority to the owners of other bonds or notes of the Authority. Subject to the provisions of the General Resolution permitting the application of moneys, rights and interests, there are pledged for the payment of the principal or Redemption Price of and interest on the Bonds (i) the proceeds of the Bonds, (ii) the Revenues, (iii) the Pledged Funds (which include all Funds and Accounts under the General Resolution except for the Revenue Fund, Escrow Payments Account, Housing Development Fund, Rebate Credit Account and to the extent provided in the General Resolution, the Authority Surplus Fund), including the investments thereof, and (iv) the rights and interests of the Authority in and to the Mortgage Loans financed under the General Resolution, the documents evidencing and securing the same and the collections (excluding Escrow Payments and Servicing Fees) received therefrom by the Authority or the Trustee on its behalf. All Bonds are secured on a parity and equally by the foregoing. Under the General Resolution, Revenues means: (i) (ii) all payments received under a Qualified Swap Agreement, which is an agreement between the Authority and a Swap Provider (a) which agreement is either approved by, or following review of such agreement the rating upon all affected Bonds is confirmed by, each Rating Agency (as defined below), and (b) under which the Authority agrees to pay the Swap Provider an amount calculated at an agreed-upon rate or index based upon a notional amount and the Swap Provider agrees to pay the Authority for a specific period of time an amount calculated at an agreed-upon rate or index based upon such notional amount, where the Swap Provider, or the person who guarantees the obligation of the Swap Provider to make its payments to the Authority, has unsecured obligations rated, as of the date the swap agreement is entered into, no lower than the rating on the Bonds by such Rating Agency, but only if any such Rating Agency is then rating (1) Bonds secured by such agreements of the Swap Provider, or (2) the series of Bonds to which such agreement may be related; and all receipts of the Authority (other than Servicing Fees and certain receipts under annual contributions contracts with HUD) derived from Permanently Financed Projects, Financed Lands, and Financed Mortgage Purchases with respect to which the Authority shall have issued Bonds for the purpose of obtaining moneys to make a Mortgage Loan, acquire Authority Lands, or make Mortgage Purchases, as applicable, or for the purpose of paying Notes or refunding Bonds issued to obtain such moneys, including but not limited to: (1) Acquired Project Operating Income, which includes the net income derived by the Authority from its acquisition, ownership or operation of an Acquired Project and remaining after payment from the gross income derived from such Acquired Project of all Fees and Charges and Mortgage Repayments required to be paid pursuant to the terms and provisions of the Mortgage relating to such Acquired Project and all costs and expenses arising from the acquisition, ownership and operation of such Acquired Project; (2) Fees and Charges, which include all fees and charges collected by the Authority pursuant to the Act; 6

11 (3) Mortgage Repayments, which include the amounts paid or required to be paid from time to time for principal or interest, or both, by a Mortgagor to the Authority pursuant to a Mortgage; (4) Mortgage Advance Amortization Payments, which include payments made by a Mortgagee in advance of the due date or dates thereof in accordance with the applicable Mortgage and the requirements with respect thereto contained in the General Resolution; (5) Mortgage Insurance Receipts, which include all payments received by the Authority pursuant to an insurance contract in respect of an Insured Mortgage upon default by a Mortgagor as to such Insured Mortgage; (6) Mortgage Subsidy Payments, which include all payments, other than Mortgage Insurance Receipts, made to the Authority with respect to a Project, or Mortgage purchased pursuant to a Mortgage Purchase, under any federal, state, local or private program intended to assist in providing housing for Persons or Families of Low or Moderate Income, less any repayment thereof that may be required under Contracts for such payments; (7) Land Sale Proceeds, which include the net proceeds of sale of Authority Lands received by the Authority; and (8) Mortgage Sale Proceeds, which include the net proceeds of the sale of a Mortgage. The payment of the principal and Redemption Price of and interest and Sinking Fund Installments on the Bonds is further secured by a pledge and assignment for the benefit of Bondowners of the Mortgage Loans now held by the Authority under the General Resolution, and will be further secured by the Mortgage Loans to be financed by the Authority from time to time from the proceeds of the Bonds. For a description of the various Funds and Accounts securing the Bonds, the application of Revenues and the Rebate Credit Amount, see EXHIBIT D SUMMARY OF CERTAIN PROVISIONS OF THE GENERAL RESOLUTION herein. The pledge of Revenues described above is subject to the respective liens of the Trustee and other fiduciaries (the Fiduciaries ) for reasonable compensation and expenses. Proceeds of the Series Bonds are intended to be used for the purposes set forth under SOURCES AND USES OF FUNDS herein. Certain proceeds of the Series Bonds will be invested in Mortgage Loans and in Investment Securities as defined in the General Resolution. See EXHIBIT D SUMMARY OF CERTAIN PROVISIONS OF THE GENERAL RESOLUTION Investment of Moneys. The Authority has no taxing power. The State of Wisconsin is not liable on the Bonds, and the Bonds are not a debt of the State of Wisconsin. Capital Reserve Fund In order to further secure the Bonds, the General Resolution establishes a Capital Reserve Fund with a Capital Reserve Fund Requirement at least equal to the maximum amount of principal and interest maturing and becoming due in any succeeding calendar year on all Bonds of the Authority then Outstanding, together with all principal and interest specified in any resolution of the Authority as a Sinking Fund Installment in such year. The Authority has covenanted not to issue any additional Bonds (a) while there is a deficiency in the Capital Reserve Fund and (b) if the Capital Reserve Fund, after issuing additional Bonds and placing in the Capital Reserve Fund the amount provided for in the Series Resolutions authorizing such Bonds, is less than the Capital Reserve Fund Requirement. It is a condition precedent to the issuance of the Bonds that the amount in the Capital Reserve Fund be at least equal to the Capital Reserve Fund Requirement. The Authority may fund portions of the Capital Reserve Fund, from time to time, with letters of credit, liquidity facilities, insurance policies, surety bonds or comparable instruments provided by financial institutions rated in one of the two highest rating categories. In the General 7

12 Resolution, the Authority has covenanted to maintain, from any legally available funds, the deposit in the Capital Reserve Fund at an amount not less than the Capital Reserve Fund Requirement. If on any date on which a Debt Service Payment is due, the moneys otherwise available for such payment, including moneys in the Redemption Fund and the Debt Service Fund, are insufficient for such purpose, the Trustee is required to withdraw an amount equal to such insufficiency from the Capital Reserve Fund to provide such payment. If necessary to restore the amount on deposit in the Capital Reserve Fund to the Capital Reserve Fund Requirement, as of each interest payment date, the Trustee is required to withdraw moneys from the General Reserve Account to the credit of the Capital Reserve Fund. Appropriations to fund any deficiencies in the Capital Reserve Fund are authorized by Section (4) of the Statute, which provides as follows: To assure the continued operation and solvency of the authority for the carrying out of the public purposes of this chapter, the authority shall accumulate in each capital reserve fund an amount equal to the capital reserve fund requirement for such fund. If at any time the capital reserve fund requirement for any capital reserve fund exceeds the amount of such capital reserve fund, the chairperson of the authority shall certify to the secretary of administration, the governor and the joint committee on finance the amount necessary to restore such capital reserve fund to an amount equal to the capital reserve fund requirement in respect thereto. If such certification is received by the secretary of administration in an even-numbered year prior to the completion of the budget compilation under s , the secretary shall include the certified amount in the budget compilation. In any case, the joint committee on finance shall introduce in either house, in bill form, an appropriation of the amount so certified to the appropriate capital reserve fund of the authority. Recognizing its moral obligation to do so, the legislature hereby expresses its expectation and aspiration that, if ever called upon to do so, it shall make such appropriation. Restrictions on Transfers of Moneys to Authority Surplus Account The General Resolution prohibits the Authority from transferring moneys in the General Reserve Account to the Authority Surplus Account unless the amount of moneys (excluding amounts representing Escrow Payments, the Housing Development Fund and the Rebate Credit Amount, if any) and investments held in the General Reserve (valued as provided in the General Resolution) exceed all requirements. For further information, see EXHIBIT D SUMMARY OF CERTAIN PROVISIONS OF THE GENERAL RESOLUTION General Reserve Account. General THE SERIES BONDS Proceeds of the Series Bonds will be used to fund Mortgage Loans secured by multifamily housing projects, to make a deposit into the Capital Reserve Fund and to pay a portion of the costs of issuance of the Series Bonds. See SOURCES AND USES OF FUNDS herein. Principal and interest on the Series Bonds are payable by the Trustee to The Depository Trust Company, as described below. The Series Bonds will be dated the date of delivery, will bear interest at the rate or rates described on the inside cover of this Official Statement, and will mature on the dates and in the amounts shown on the inside cover of this Official Statement. The Series Bonds are issuable only as fully registered bonds without coupons in denominations of $5,000 principal amount or any integral multiple thereof. Interest Provisions Interest will be payable to the Bondowners determined as of the close of business on the relevant record date, which in the case of the 2047 Term Rate Bonds will be the Business Day preceding each interest payment date and for the Series A Bonds (other than the 2047 Term Rate Bonds) and the Series B Bonds will be April 15 and 8

13 October 15. The Series Bonds will bear interest, at the rates set forth on the inside cover of this Official Statement, from their dated date, with interest payable semi-annually on May 1 and November 1 of each year, commencing May 1, 2018; provided that the interest rate of the 2047 Term Rate Bonds on the inside cover of this Official State is in effect only prior to the Scheduled Mandatory Tender Date of the 2047 Term Bonds, as described below. Interest on the Series Bonds shall be computed on the basis of a 360-day year consisting of twelve, 30-day months. Scheduled Mandatory Tender of 2047 Term Rate Bonds * The 2047 Term Rate Bonds are subject to mandatory tender, unless earlier redeemed, in whole or in part, for purchase (with no right to retain) on May 1, 2020 (the Scheduled Mandatory Tender Date ), at a price equal to 100% of the principal amount thereof plus accrued interest (the Purchase Price ). The Trustee shall deliver a notice of mandatory tender to the 2047 Term Rate Bond Bondholders at least 15 days prior to the Scheduled Mandatory Tender Date, stating the Scheduled Mandatory Tender Date, the Purchase Price, and, whether all Bondholders of the 2047 Term Rate Bonds will be deemed to have tendered their 2047 Term Rate Bonds upon such Scheduled Mandatory Tender Date. If on or before the date which is at least 30 days prior to the Scheduled Mandatory Tender Date, (i) the Authority elects not to make funds available to pay the purchase price of all the 2047 Term Rate Bonds on the Scheduled Mandatory Tender Date or (ii) the Authority elects not to remarket all of the 2047 Term Rate Bonds to new purchasers on the Scheduled Mandatory Tender Date, the Authority shall, at least 25 Business Days prior to the Scheduled Mandatory Tender Date, notify the Trustee of the aggregate principal amount of the 2047 Term Rate Bonds that will and will not be subject to mandatory tender for purchase on the Scheduled Mandatory Tender Date. If only a portion of the 2047 Term Rate Bonds will be subject to mandatory tender on the Scheduled Mandatory Tender Date, the 2047 Term Rate Bonds that will and will not be subject to mandatory tender on such date will be selected by lot or such other manner as DTC shall determine. Bondholders of the 2047 Term Rate Bonds that will be subject to mandatory tender for purchase on the Scheduled Mandatory Tender Date will receive notice of the mandatory tender as described in the second preceding paragraph. The Trustee will, at least 20 Business Days prior to the Scheduled Mandatory Tender Date, deliver notice to Bondholders of those 2047 Term Rate Bonds not subject to mandatory tender for purchase on the Scheduled Mandatory Tender Date that their 2047 Term Rate Bonds will not be subject to mandatory tender on such date. The 2047 Term Rate Bonds (i) not subject to mandatory tender on the Scheduled Mandatory Tender Date and not redeemed on or prior to such date or (ii) subject to mandatory tender on the Scheduled Mandatory Tender Date and not purchased on such date or redeemed on or prior to such date, will be retained by the Bondholders thereof and will bear interest at a rate of 10% * per annum from the date of the Scheduled Mandatory Tender Date to, but not including, the earliest of (a) maturity, (b) the date of redemption of such 2047 Term Rate Bond or (c) the date that such 2047 Term Rate Bonds are remarketed to new purchasers. Subseries of 2047 Term Rate Bonds may be created on the Scheduled Mandatory Tender Date. Any 2047 Term Rate Bond that is subject to mandatory tender on the Scheduled Mandatory Tender Date may be redeemed without further notice on such date. Subsequent Mandatory Tender of 2047 Term Rate Bonds* The Authority may establish one or more Subsequent Mandatory Tender Dates on which all or a portion of the 2047 Term Rate Bonds are subject to mandatory tender, unless earlier redeemed, in whole or in part, for purchase (with no right to retain) at the Purchase Price. The Trustee shall deliver a notice of mandatory tender to the applicable 2047 Term Rate Bond Bondholders at least 15 days prior to any Subsequent Mandatory Tender Date, stating the Subsequent Mandatory Tender Date, the Purchase Price, and, that all or a portion of Bondholders of the applicable 2047 Term Rate Bonds will be deemed to have tendered their 2047 Term Rate Bonds upon such Subsequent Mandatory Tender Date. * Preliminary, subject to change 9

14 If (i) the Authority elects not to make funds available to pay the Purchase Price of all of such 2047 Term Rate Bonds on such Subsequent Mandatory Tender Date or (ii) the Authority elects not to remarket all such 2047 Term Rate Bonds to new purchasers on such Subsequent Mandatory Tender Date, the Authority shall, at least 25 Business Days prior to the Subsequent Mandatory Tender Date, notify the Trustee of the aggregate principal amount of such 2047 Term Rate Bonds that will and will not be subject to mandatory tender for purchase on the Subsequent Mandatory Tender Date. If only a portion of such 2047 Term Rate Bonds will be subject to mandatory tender on such Subsequent Mandatory Tender Date, the 2047 Term Rate Bonds that will and will not be subject to mandatory tender on such date will be selected by lot or such other manner as DTC shall determine. Bondholders of the 2047 Term Rate Bonds that will be subject to mandatory tender for purchase on such Subsequent Mandatory Tender Date will receive notice of the mandatory tender as described in the second preceding paragraph. The Trustee will, at least 20 Business Days prior to any Subsequent Mandatory Tender Date, deliver notice to Bondholders of those 2047 Term Rate Bonds for which such Subsequent Mandatory Tender Date has been established and with respect to which notice of such Subsequent Mandatory Tender Date has been given and which are not subject to mandatory tender for purchase on such Subsequent Mandatory Tender Date that their 2047 Term Rate Bonds will not be subject to mandatory tender on such date. The 2047 Term Rate Bonds for which such Subsequent Mandatory Tender Date has been established and with respect to which notice of such Subsequent Mandatory Tender Date has been given (i) not subject to mandatory tender on such Subsequent Mandatory Tender Date and not redeemed on or prior to such date or (ii) subject to mandatory tender on such Subsequent Mandatory Tender Date and not purchased on such date or redeemed on or prior to such date, will be retained by the Bondholders thereof and will bear interest at a rate of 10% * per annum from the date of the Subsequent Mandatory Tender Date to, but not including, the earliest of (a) maturity, (b) the date of redemption of such 2047 Term Rate Bond, or (c) the date that such 2047 Term Rate Bonds are remarketed to new purchasers. Subseries of 2047 Term Rate Bonds may be created on the Subsequent Mandatory Tender Date. Any 2047 Term Rate Bond that is subject to mandatory tender on a Subsequent Mandatory Tender Date may be redeemed without further notice on such date. The 2047 Term Rate Bonds do not, nor is there currently any requirement or assurance that the 2047 Term Rate Bonds will, have the benefit of a liquidity or other credit facility to pay the purchase price of the 2047 Term Rate Bonds on the Scheduled Mandatory Tender Date or a Subsequent Mandatory Tender Date. As a result, all Bondholders of the 2047 Term Rate Bonds (including those subject to mandatory tender on the Scheduled Mandatory Tender Date or Subsequent Mandatory Tender Date and not purchased) may be required to hold their 2047 Term Rate Bonds until maturity or prior redemption. Redemption Provisions * Special Redemption General The Series Bonds shall be subject to redemption, in whole or in part, at any time, at a price equal to 100% of the principal amount thereof, plus accrued interest, upon notice as provided in the General Resolution, from Mortgage Insurance Receipts, Mortgage Sale Proceeds in the event of a default by a Mortgagor, Mortgage Advance Amortization Payments, and the proceeds of sale of Projects, portions of Projects or lands related to Projects, to the extent that the amount of any such Revenues is not required to be transferred to the Debt Service Fund or the Capital Reserve Fund, together with other Revenues and excess moneys in the Debt Service Fund that are transferred to the Redemption Account. Such Revenues derived in respect of other Bonds issued under the General Resolution may be used for special redemption of the Series Bonds. Additionally, the Series Bonds may also be redeemed at any time, in whole or in part, at a price equal to 100% of the principal amount thereof, plus accrued interest to the date of redemption, from such portion of the net proceeds of sale of the Series Bonds as have not been used by the * Preliminary; subject to change. 10