Final Official Statement Dated November 4, 2013

Transcription

1 New Issue Investment Rating: Moody s Investors Service Aa2 Final Official Statement Dated November 4, 2013 Subject to compliance by the City with certain covenants, in the opinion of Chapman and Cutler LLP, Bond Counsel, under present law, interest on the Bonds is excludable from gross income of the owners thereof for federal income tax purposes, and is not included as an item of tax preference in computing the federal alternative minimum tax for individuals and corporations, but such interest is taken into account in computing an adjustment used in determining the federal alternative minimum tax for certain corporations. Interest on the Bonds is not exempt from present State of Illinois income taxes. See TAX EXEMPTION herein for a more complete discussion. The Bonds are qualified tax-exempt obligations under Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. See QUALIFIED TAX-EXEMPT OBLIGATIONS herein. $1,505,000 CITY OF GENEVA Kane County, Illinois General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 Dated Date of Delivery Book-Entry Bank Qualified Due May 1 and November 1 as Detailed Below The $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 (the Bonds ), are being issued by the City of Geneva, Kane County, Illinois, Illinois (the City ). Interest on the Bonds is payable semiannually on May 1 and November 1 of each year, commencing May 1, Interest is calculated based on a 360-day year of twelve 30-day months. The Bonds will be issued using a book-entry system. The Depository Trust Company ( DTC ), New York, New York, will act as securities depository for the Bonds. The ownership of one fully registered Bond for each maturity will be registered in the name of Cede & Co., as nominee for DTC and no physical delivery of Bonds will be made to purchasers. The Bonds will mature as detailed herein. AMOUNTS, MATURITIES, INTEREST RATES, YIELDS AND CUSIP NUMBERS Principal Due Interest Principal Due Interest Amount May 1 Rate Yield CUSIP Amount Nov. 1 Rate Yield CUSIP **** **** **** **** **** **** **** **** **** **** $ 75, % 1.100% KZ7 $ 80, % 1.150% LA1 80, % 1.350% KV6 $635, %; Term Bonds due November 1, 2015; Yield %; KY0 $330, %; Term Bonds due May 1, 2019; Yield %; KW4 $305, %; Term Bonds due May 1, 2021; Yield %; KX2 For further details see MANDATORY REDEMPTION herein. The Bonds are not subject to optional redemption prior to maturity. OPTIONAL REDEMPTION PURPOSE, LEGALITY AND SECURITY The Bond proceeds will be used to currently refund all of the City s outstanding Electric Revenue Bonds, Series 2003 (the 2003 Bonds ) and to pay the costs of issuing the Bonds. See PLAN OF FINANCING herein. In the opinion of Bond Counsel, Chapman and Cutler LLP, Chicago, Illinois, the Bonds will constitute valid and legally binding obligations of the City payable as to principal and interest from: (a) ratably and equally with the City s outstanding General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2006D, General Obligation Bonds (Electric System Alternate Revenue Source), Series 2007, and General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2011, certain net revenues to be derived from the electric system of the City (the Pledged Electric Revenues ), and (b) ad valorem taxes levied against all taxable property within the City without limitation as to rate or amount (the Pledged Taxes ) except that the rights of the owners of the Bonds and the enforceability of the Bonds may be limited by bankruptcy, reorganization, moratorium, insolvency and other similar laws relating to creditors rights and by equitable principles, whether considered at law or in equity, including the exercise of judicial discretion. See DESCRIPTION OF THE BONDS herein. The Bonds are offered when, as and if issued and received by the Underwriter, subject to the approving legal opinion of Chapman and Cutler LLP, Chicago, Illinois, Bond Counsel, and certain other conditions. It is expected that the Bonds will be made available for delivery on or about November 19, BAIRD

2 No dealer, broker, salesman or other person has been authorized by the Village to give any information or to make any representations with respect to the Bonds other than as contained in the Official Statement or the Final Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the Village. Certain information contained in the Official Statement and the Final Official Statement may have been obtained from sources other than records of the Village and, while believed to be reliable, is not guaranteed as to completeness. THE INFORMATION AND EXPRESSIONS OF OPINION IN THE OFFICIAL STATEMENT AND THE FINAL OFFICIAL STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF THE OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE UNDER EITHER SUCH DOCUMENT SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE VILLAGE SINCE THE RESPECTIVE DATES THEREOF. References herein to laws, rules, regulations, ordinances, resolutions, agreements, reports and other documents do not purport to be comprehensive or definitive. All references to such documents are qualified in their entirety by reference to the particular document, the full text of which may contain qualifications of and exceptions to statements made herein. Where full texts have not been included as appendices to the Official Statement or the Final Official Statement, they will be furnished on request. This Official Statement does not constitute an offer to sell, or solicitation of an offer to buy, any securities to any person in any jurisdiction where such offer or solicitation of such offer would be unlawful. The tax advice contained in this Official Statement is not intended or written by the Village, its Bond Counsel, or any other tax practitioner to be used, and it cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer. The tax advice contained in this Official Statement was written to support the promotion or marketing of the Bonds. Each taxpayer should seek advice based on the taxpayer s particular circumstances from an independent tax advisor.

3 TABLE OF CONTENTS Page BOND ISSUE SUMMARY... 1 CITY OF GENEVA City Council Members and Officials... 2 DESCRIPTION OF THE BONDS... 2 Security: Alternate Revenue Sources and Tax Levy... 2 Highlights of Alternate Bonds... 3 Abatement of Pledged Taxes... 4 Refunding Alternate Bonds... 4 Bond Funds... 4 Certain Risk Factors... 4 THE CITY... 5 Overview... 5 City Government and Services... 5 Description of the Electric System... 6 Transportation... 6 Community Life... 6 Education... 7 Economic Development... 7 SOCIOECONOMIC INFORMATION... 8 Employment... 8 Building Permits Housing Income Retail Activity THE ELECTRIC SYSTEM Large Users Users and Usage Schedule of Electric Rates Billing and Collecting ELECTRIC SYSTEM DEBT INFORMATION ELECTRIC SYSTEM FINANCIAL INFORMATION No Consent or Updated Information Requested of the Auditor Financial Overview Pension and Retirement Obligations Summary Financial Information Management of the Electric System PLAN OF FINANCING THE CITY GENERAL DEBT INFORMATION PROPERTY ASSESSMENT AND TAX INFORMATION REAL PROPERTY ASSESSMENT, TAX LEVY AND COLLECTION PROCEDURES Tax Levy and Collection Procedures Exemptions Property Tax Extension Limitation Law Truth in Taxation Law FINANCIAL INFORMATION Summary Financial Information EMPLOYEE RETIREMENT BENEFITS OBLIGATIONS Illinois Municipal Retirement Fund Police Pension Fund Firefighters Pension Fund Other Post-Employment Benefits REGISTRATION, TRANSFER AND EXCHANGE TAX EXEMPTION QUALIFIED TAX-EXEMPT OBLIGATIONS CONTINUING DISCLOSURE THE UNDERTAKING Annual Financial Information Disclosure Reportable Events Disclosure Consequences of Failure of the City to Provide Information Amendment; Waiver Termination of Undertaking Additional Information Dissemination of Information; Dissemination Agent (i)

4 TABLE OF CONTENTS (Continued) Page OPTIONAL REDEMPTION MANDATORY REDEMPTION LITIGATION CERTAIN LEGAL MATTERS FINAL OFFICIAL STATEMENT AUTHORIZATION INVESTMENT RATING UNDERWRITING FINANCIAL ADVISOR CERTIFICATION APPENDIX A - CITY OF GENEVA - EXCERPTS OF FISCAL YEAR 2013 AUDITED FINANCIAL STATEMENTS 50 APPENDIX B - DESCRIBING BOOK-ENTRY-ONLY ISSUANCE 51 APPENDIX C - PROPOSED FORM OF OPINION OF BOND COUNSEL 53 APPENDIX D - EXCERPTS OF FISCAL YEAR 2013 AUDITED FINANCIAL STATEMENTS RELATING TO THE CITY S PENSION PLANS 55 (ii)

5 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 BOND ISSUE SUMMARY This Bond Issue Summary is expressly qualified by the entire Final Official Statement, which is provided for the convenience of potential investors and which should be reviewed in its entirety by potential investors. Issuer: City of Geneva, Kane County, Illinois. Issue: $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series Dated Date: Date of delivery, expected to be November 19, Interest Due: Each May 1 and November 1, commencing May 1, Principal Due: May 1 and November 1, commencing November 1, 2015, May 1, 2016, November 1, 2016, May 1, 2017, May 1, 2019 and May 1, 2021, as detailed on the cover page of this Final Official Statement. Optional Redemption: Mandatory Redemption: Authorization: Security: Credit Rating: Purpose: Tax Exemption: Bank Qualification: Bond Registrar/Paying Agent: The Bonds are not subject to optional redemption prior to maturity. The Bonds are subject to mandatory redemption. See MANDATORY REDEMPTION herein. The Bonds are Authorized by Division 4 of Article 8 of the Illinois Municipal Code, as amended and supplemented by the Local Government Debt Reform Act, as amended, and the other Omnibus Bond Acts, as amended, and by vote of the City Council. The Bonds will constitute valid and legally binding obligations of the City payable as to principal and interest from: (a) ratably and equally with the City s outstanding General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2006D, General Obligation Bonds (Electric System Alternate Revenue Source), Series 2007, and General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2011, certain net revenues to be derived from the electric system of the City (the Pledged Electric Revenues ), and (b) ad valorem taxes levied against all taxable property within the City without limitation as to rate or amount (the Pledged Taxes ) except that the rights of the owners of the Bonds and the enforceability of the Bonds may be limited by bankruptcy, reorganization, moratorium, insolvency and other similar laws relating to creditors rights and by equitable principles, whether considered at law or in equity, including the exercise of judicial discretion. See DESCRIPTION OF THE BONDS herein. The Bonds have been rated Aa2 from Moody s Investors Service. The Bond proceeds will be used to currently refund all of the City s outstanding Electric Revenue Bonds, Series 2003 (the 2003 Bonds ) and to pay the costs of issuing the Bonds. See PLAN OF FINANCING herein Chapman and Cutler LLP, Chicago, Illinois, will provide an opinion as to the federal tax exemption of interest on the Bonds as discussed under TAX EXEMPTION in this Final Official Statement. Interest on the Bonds is not exempt from present State of Illinois income taxes. The Bonds are qualified tax-exempt obligations under Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. See QUALIFIED TAX-EXEMPT OBLIGATIONS herein. U.S. Bank National Association, Chicago, Illinois. Delivery: The Bonds are expected to be delivered on or about November 19, Book-Entry Form: Denomination: Underwriter: Financial Advisor: The Bonds will be registered in the name of Cede & Co. as nominee for The Depository Trust Company ( DTC ), New York, New York. DTC will act as securities depository of the Bonds. See APPENDIX B herein. $5,000 or integral multiples thereof. Robert W. Baird & Co., Inc., Naperville, Illinois. Speer Financial, Inc., Chicago, Illinois. 1

6 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 CITY OF GENEVA Kane County, Illinois Kevin R. Burns Mayor City Council Members Charles Brown Dorothy K. Flanagan Thomas Simonian Mike Bruno Dean Kilburg Ron Singer Donald B. Cummings, Jr. Craig C. Maladra Dawn Vogelsberg Richard Marks Lynn P. Landberg City Clerk Officials Mary McKittrick City Administrator Thomas W. Dahl, CPA Finance Manager Patrick J. McQueeny Treasurer Security: Alternate Revenue Sources and Tax Levy DESCRIPTION OF THE BONDS The Bonds are payable both as to principal and interest from: (a) ratably and equally with the City s outstanding General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2006D, General Obligation Bonds (Electric System Alternate Revenue Source), Series 2007, and General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2011 (collectively, the Prior Electric Alternate Bonds ), certain net revenues to be derived from the electric system of the City (the Pledged Electric Revenues ), and (b) ad valorem taxes levied against all taxable property within the City without limitation as to rate or amount (the Pledged Taxes ) except that the rights of the owners of the Bonds and the enforceability of the Bonds may be limited by bankruptcy, reorganization, moratorium, insolvency and other similar laws relating to creditors rights and by equitable principles, whether considered at law or in equity, including the exercise of judicial discretion. Pursuant to the Local Government Debt Reform Act of the State of Illinois, as amended, (the Debt Reform Act ) the City will pledge such monies to the payment of Bonds and shall covenant to provide for and apply such Pledged Electric Revenues to the payment of Bonds and the provision of not less than an additional 0.25 times debt service on the Bonds and the Prior Electric Alternate Bonds, which pledge and covenant shall constitute a continuing obligation of the City and continuing appropriation of the amounts received. For the prompt payment of the Bonds, the full faith, credit and resources of the City are irrevocably pledged. 2

7 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 In the ordinance authorizing the Bonds (the Bond Ordinance ), the City covenants and agrees with the purchasers and the owners of the Bonds that so long as any of the Bonds remain outstanding, the City will take no action or fail to take any action which in any way would adversely affect the ability of the City to collect the Pledged Electric Revenues or, except for abatement of tax levies as permitted in the Bond Ordinance, to levy and collect the Pledged Taxes. The City and its officers will comply with all present and future applicable laws in order to assure that the Pledged Electric Revenues will be available and deposited (as set forth in the Bond Ordinance) to the 2013 Alternate Bond and Interest Subaccount and that the Pledged Taxes will be levied, extended and collected as provided in the Bond Ordinance and deposited in the bond fund created under the Bond Ordinance in connection with the Bonds (the Bond Fund ). As provided in the Debt Reform Act, the City s determination of the sufficiency of the Pledged Electric Revenues will be based on the City s audited financial statements for its fiscal year ended. Highlights of Alternate Bonds Section 15 of the Debt Reform Act provides that whenever revenue bonds have been authorized to be issued pursuant to applicable law or there exists for a governmental unit (such as the City) a revenue source, the City may issue its general obligation bonds payable in lieu of said revenue bonds or from such revenue source, and such general obligation bonds may be referred to as "alternate bonds." Such bonds are general obligation debt payable from the pledged revenues with the general obligation of the City as back-up security. The Debt Reform Act prescribes several conditions that must be met before alternate bonds issued in lieu of revenue bonds or payable from a revenue source may be issued. First, alternate bonds must be issued for a lawful corporate purpose. If issued in lieu of revenue bonds, alternate bonds shall be issued for the purposes for which said revenue bonds shall have been authorized and if issued payable from a revenue source, which revenue source is limited in its purposes or applications, then the alternate bonds can only be issued for such limited purposes or applications. Second, the question of issuance must be submitted to referendum if, within thirty (30) days after publication of an authorizing Ordinance and notice of intent to issue alternate bonds, a petition signed by the greater of (i) 7.5% of the registered voters in the government unit; or (ii) 200 of those registered voters or 15%, whichever is less, is filed. Third, an issuer must demonstrate that the pledged revenues are sufficient in each year to provide an amount not less than 1.25 times debt service on the alternate bonds payable from such enterprise revenues or revenue source previously issued and outstanding and the alternate bonds proposed to be issued. The sufficiency of the enterprise revenues or revenue source must be supported by the most recent audit of the governmental unit. The audit must be for a fiscal year ending not earlier than 18 months prior to the issuance of the alternate bonds. If the audit does not adequately show such enterprise revenues or revenue source or if such source of revenue is shown to be insufficient, then the determination of sufficiency must be supported by the report of an independent accountant or feasibility analyst, the latter having a national reputation for expertise in such matters. Such report must demonstrate the sufficiency of the revenue and explain how the revenues will be greater than those shown in the audit. Whenever such sufficiency is demonstrated by reference to a schedule of higher rates or charges for enterprise revenues or a higher tax imposition for a revenue source, such higher rates, charges or taxes must be imposed by an Ordinance or resolution adopted prior to the delivery of the alternate bonds. Fourth, the enterprise revenues or revenue source must be pledged to the payment of the alternate bonds. 3

8 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 Last, the governmental unit must covenant to provide for, collect and apply the enterprise revenues or revenue source to the payment of the alternate bonds and to provide for an amount equal to not less than an additional.25 times debt service. The City will comply with all of the aforementioned conditions prior to the issuance of the Bonds, including demonstrating that the Pledged Electric Revenues are sufficient in each year to make debt service payments on the Bonds by reference to the City s audit for the fiscal year ending. Abatement of Pledged Taxes Whenever funds are available to pay any principal of or interest on the Bonds when due, the City will direct the deposit of such funds into the 2013 Alternate Bond and Interest Subaccount (as set forth in the Bond Ordinance) created solely for such purpose. The City covenants in the Bond Ordinance to deposit monthly into the 2013 Alternate Bond and Interest Subaccount (as set forth in the Bond Ordinance) an amount equal to one-fifth (1/5) of the next scheduled interest payment and one-tenth (1/10) of the next scheduled principal payment. The City pledges to abate the levy for the Bonds only upon full funding of the 2013 Alternate Bond and Interest Subaccount (as set forth in the Bond Ordinance) in the appropriate levy amount. Refunding Alternate Bonds Section 15 of the Debt Reform Act, as amended, provides that alternate bonds may be issued to refund or advance refund alternate bonds without meeting any of the conditions set forth in such section that would otherwise apply (see Highlights of Alternate Bonds above), if the term of the refunding bonds is no longer than the term of the refunded bonds and the debt service payable on the refunding bonds in each year is no more than the debt service payable in such year on the refunded bonds. These conditions will not be met in connection with the issuance of the Bonds. Bond Funds The City will deposit the appropriate Pledged Electric Revenues into the 2013 Alternate Bond and Interest Subaccount (as set forth in the Bond Ordinance) and the Pledged Taxes into a separate Bond Fund, which is a trust fund established for the purpose of carrying out the covenants, terms and conditions imposed upon the City by the Bond Ordinance. The Bonds are secured by a pledge of all of the monies on deposit in the Bond Fund, and such pledge is irrevocable until the Bonds have been paid in full or until the obligations of the City are discharged under the Bond Ordinance. Certain Risk Factors The ability of the City to pay the Bonds from the Pledged Electric Revenues may be limited by circumstances beyond the control of the City. There is no guarantee that the Pledged Electric Revenues will continue to be available at current levels. To the extent that Pledged Electric Revenues may be insufficient to pay the Bonds, the Bonds are to be paid from the Pledged Taxes. If the Pledged Taxes are ever extended for the payment of the Bonds, the amount of the Bonds then outstanding will be included in the computation of indebtedness of the City for purposes of all statutory provisions or limitations until such time as an audit of the City shows that the Bonds have been paid from the Pledged Electric Revenues for a complete fiscal year. Pledged Taxes have not been levied for the May 1, 2014, maturity of the Bonds. 4

9 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 Overview THE CITY The City, county seat of Kane County, was founded in 1835 and incorporated in Located about 35 miles west of Chicago in the Fox River Valley, the City is bordered on the north by the City of St. Charles, on the south by the City of Batavia, on the east by West Chicago, and on the west by unincorporated Kane County. The Fox River flows through the City. The City is primarily residential with a balanced mix of commercial and industrial activity. The 1990 Census reported a population of 12,617. The 2000 Census reported the City s population at 19,515, a 54.7% increase from the 1990 Census. The 2010 Census reported the City s population at 21,495, a 10.15% increase from the 2000 Census. The City has a land area of approximately 8.5 square miles. The City's annexation activity continued with the annexation of the 400-acre Fisher Farm in 1996 and the 66- acre Sunset Prairie in These are the last major residential annexations for the City and Fisher Farm is 75% developed for 300 acres of residential development and 100 acres of commercial/office development. The City anticipates continuing business annexation activity in future years, primarily on the eastern boundary of the City between Kirk Road and Kautz Road which is estimated to build out by the year The City provides a police department with 37 full-time sworn personnel, and a fire department with 20 fulltime firemen and 40 paid-on-call firemen. The City employs 95 other full-time employees, including 17 in the Water and Sewer Department. The only employees of the City who are members of a collective bargaining unit are in the Electric Department, Fire Department and Police Department. The International Brotherhood of Electrical Workers Local #196 has a five-year employment contract which expires on April 30, The International Association of Fire Fighters Local #4287 has a four-year contract which expires on April 30, The Fraternal Order of Police Labor Council has a contract which expires on April 30, In addition to customary services provided to City residents, the City supports a dial-a-bus program for senior citizens and handicapped persons and, together with the neighboring cities of St. Charles and Batavia, owns and operates an emergency communication system. The City contracts collectively with neighboring municipalities for ambulance service. City Government and Services The City is a non-home rule municipality governed by a mayor-council system that is made up of a Mayor elected at large and ten aldermen elected from five wards for four year staggered terms. The City Clerk and Treasurer are also elected at large for four-year terms. The Mayor appoints the City Administrator with the advice and consent of the City Council. The City Administrator oversees all day to day operations of the government, directs all department heads, coordinates interdepartmental actions as assigned by the Mayor or the City Council, and develops, recommends, and institutes administrative policies and procedures with the concurrence of the City Council. The City is responsible for providing police and fire protection, maintaining streets, providing sewer and water services and supplying electricity to the City's residences, businesses, and industries. Additional information on the City and its Waterworks and Sewerage System is available at The City owns and operates a water system, which obtains water from both deep and shallow wells. Water storage capacity is 2.75 million gallons. Average usage is 3.1 million gallons per day ( MGD ). An activated sludge wastewater treatment plant is also owned and operated by the City. Final biosolids are applied to area farmland. Improvements completed in 2006 increased the plant capacity to 5 MGD. In 2008, the City constructed a $30 million reverse osmosis membrane treatment plant to reduce hardness levels to six grains and is designed to produce up to 8 MGD. 5

10 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 An activated sludge wastewater treatment plant with tertiary treatment prior to discharge is also owned and operated by the City. Treated sludge is applied on area farmland. The plant has a capacity of four MGD and is being expanded to five MGD. Description of the Electric System The City has owned and operated a municipal electric distribution system (the System ) since The City operates the System without competition from other suppliers or distributors of electrical power. The System is not subject to regulation by the Illinois Commerce Commission. The City's electric system is inter-connected to the Commonwealth Edison Company 34.5 kv sub-transmission system in seven locations which include the South Street, Peyton Street, Keslinger Road, Delnor, Western Avenue, East Side Drive and the Geneva Business Park substations. The City s distribution system is kv. The City owns and operates a lean burn, 30 MW natural gas peaking power plant consisting of five reciprocating engine/generators. The power plant is located within the corporate limits of the City, and is interconnected with the City's distribution system. The City's power plant is economically dispatched based upon day-ahead market prices. This procedure reduces the City's purchased power costs and transmission and capacity costs, from the regional transmission provider PJM. The City has several multi-years Power Sales Agreements, the first is with a landfill gas generator located within its corporate limits. The landfill gas sales agreement expires on January 1, 2015 and provides approximately 10% of the City's energy requirements. The second is with Exelon Generation Company that ends January 1, The third is with NextEra Energy Power Marketing, LLC which begins on January 1, 2014 and ends January 1, 2017, approximately 30% of the City's energy requirements. Finally, the City is a member of, and has a Power Sales Agreement, with Northern Illinois Municipal Power Agency ( NIMPA ). NIMPA owns 7.6% of Prairie State Generating Company ( PSGC ). NIMPA provides approximately 60% of the City's energy requirements. Transportation A variety of highway and commuter and freight rail facilities are available to City residents. Commuter travel to and from Chicago's downtown business district is available from the Regional Transportation Authority, with a commuter station centrally located in downtown Geneva. Illinois Routes 25 and 31, which straddle the Fox River, connect with the Interstate 88 East-West Tollway approximately 7 miles south of the City. Approximately 9 miles to the City's north, Routes 25 and 31 connect with the Interstate 90 Northwest Tollway. O'Hare International Airport is a 60 minute drive away via tollway. Community Life The Geneva Park District (the District ) is an independent public agency providing park facilities and recreation programs to residents of all ages. Included among the District's facilities are a racquetball center, two lighted baseball fields, the Geneva Memorial Swimming Pool, playground facilities, lighted tennis courts, and a riverfront park. 6

11 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 The Geneva Public Library District (the Library ), an independent unit of government, is governed by a seven-member board of directors elected at large. The Library offers a wide range of library services and serves approximately 16,279 patrons annually. The Library houses over 56,000 volumes in its adult collection, more than 35,000 volumes in its juvenile collection, approximately 4,975 recordings and 217 newspaper and periodical titles. A variety of adult and children's programs are presented throughout the year. Delnor Community Hospital has 159 beds in its Geneva facility and employs more than 1,159 health care professionals. The Hospital's medical staff is composed of more than 175 general physicians and specialists. The parent corporation, Delnor Community Health Care System, constructed the Geneva facility in Education The City's major public school district is Community Unit School District No The District has six elementary schools (grades K-5), two middle schools (grades 6-8), one high school and a combined enrollment of approximately 5,600 students. Also in the City is St. Peter's School, a parochial elementary school. Northern Illinois University has its main campus in DeKalb, approximately one half hour's drive from the City. City residents also have access to many public and private universities and colleges in the Chicago metropolitan area. Waubonsee Community College District No. 516 also serves City residents, providing associate degrees, and continuing education, vocational education, and other programs. Waubonsee Community College District No. 516 has an enrollment of approximately 10,000 students. Economic Development Downtown Business District: In 1982, the City established a Tax Increment District in the downtown area encompassing 37.5 acres of riverfront property. In 1984, a private developer constructed a commercial project on the west bank of the Fox River, north of State Street. Included in the project were several restaurants, a banquet facility, offices and retail shops. In 1992, the City entered into an agreement with Sho-Deen, Inc., for the redevelopment of the southwest quadrant of the river front area (Phase II). Incorporating the adaptive reuse of two historic buildings, the developer constructed a 42 room "country inn". This inn, the Herrington, opened in August In addition, the developer constructed approximately 20,000 square feet of office/retail space along State Street, which opened in Spring In 1994, the City entered into a redevelopment agreement with the owner of a bicycle shop located along the east bank of the Fox River. The City executed a land exchange with the merchant facilitating the construction of a more attractive and larger store. The demolition of the former building provides the City space for a new public parking lot as well as greatly enhancing the view of the river. In 1996, the City and a private developer entered into a TIF Redevelopment Agreement to permit the construction of two new commercial buildings and three residential condominium buildings. Additionally the City acquired nearly two acres of property located along the west bank of the Fox River for public open space and passive recreational uses and in 1998 acquired 7,900 square feet for additional public parking. This TIF District closed in In 1994 the City initiated a "Facade Improvement and Historic Preservation Program". Since its inception, the City has provided matching grant funds in excess of $90,000 to local business community in an effort to restore building facades and make general streetscape improvements adding value to the commercial building stock in downtown Geneva. 7

12 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 Commercial Corridor-West: The Randall Road commercial corridor is another strong commercial area in the City. In December 1992, the City negotiated additional access locations for Randall Road with the County, which was key to the attraction of retail users. On the west side of Geneva, Randall Road serves as a major north-south thoroughfare and connects with the Interstate 90 Northwest Tollway, approximately 15 miles north of the City. The improved access and commercial potential of the corridor has resulted in substantial retail for development. Since 1994 there has been nearly 1.47 million square feet of retail buildings within the Randall Road Corridor north of Fabyan Parkway and south of the Union Pacific railroad line. Further, since 1995 new health care related facilities have developed around the Delnor Community Hospital (the Hospital ) adding approximately 80,000 square feet of commercial/office space along Randall Road north of the rail line. In 2015, the Hospital is envisioning $97 million in a series of renovation projects. Additionally, a 400,000 square foot lifestyle commercial center is being constructed on the north end of Randall Road. Industrial: In 1998 construction was completed on Millard Refrigerated Services, located in the Geneva Business Park on the west side of Kautz Road. They join Industrial Hard Chrome, Gordon Flesch Company, and Continental Envelope as residents of the business park. The City also secured an economic development funding commitment of $1.7 million from the State of Illinois Department of Transportation for supporting road improvements. In addition to improvements to Kautz Road and the extension of Averill Road and Geneva Drive, the City has committed nearly $4.5 million toward sewer, water and electric facilities to serve the business park. In terms of business investment from construction, existing facilities housing Industrial Hard Chrome, Gordon Flesch and Continental Envelope, in the aggregate, amount to nearly $12.5 million in private investment in the City. The light industrial and office research developments serve to further diversify and expand the City's tax base for the benefit of city services, schools, parks, and the library. The City's early success has resulted from aggressive marketing efforts, low electric rates, and an attractive location. Further, Millard Refrigerated Services has constructed the first six phases, totaling 652,687 square feet of refrigerated warehousing and valued at $4 million, of a proposed 850,000 square foot facility. Finally Murnane Industries recently constructed a 40,000 square foot light manufacturing plant in the City's eastside industrial area and Production Packaging built a 90,000 square foot manufacturing and warehouse facility. In 2012, Roquette constructed a new R&D facility totalling 32,000 square feet. In November 2012, South East Master Plan was completed. It is a high level engineering study looking at infrastructure needed to annex an additional 200 acres. The Mayor and City Council recognize the need to keep the thriving central area viable while diversifying and expanding the City's tax base in the developing areas along the east and west corridors of the City in order to continue to deliver a high level of city, school, park, and other public services in a cost effective manner. Employment SOCIOECONOMIC INFORMATION The following statistics principally pertain to the City with additional comparisons with Kane County (the County ) and the State of Illinois (the State ). Substantial employment is available in surrounding communities, the Research and Development Corridor immediately south of the City, and throughout the Chicago metropolitan area. Numerous employers are located within the City and in surrounding communities. The following employment data shows a consistently diverse and strong growth trend for employment in the County. This data is NOT comparable to similar U.S. Census statistics, which would include government employment, and establishments not covered by the Illinois Unemployment Insurance Program, and could classify employment categories differently. 8

13 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 Kane County Private, Non-Agricultural Employment Covered by the Illinois Unemployment Insurance Act(1) (Data as of March for each Year) Farm and Forestry Mining and Quarrying Construction... 10,790 8,240 6,797 6,969 7,129 Manufacturing... 33,825 29,883 27,699 29,454 30,081 Transportation, Communications, Utilities... 8,157 7,709 7,209 6,799 6,470 Wholesale Trade... 11,246 10,913 11,261 11,646 11,934 Retail Trade... 21,856 20,918 20,202 19,988 19,648 Finance, Insurance, Real Estate... 9,614 9,257 8,850 8,449 8,752 Services(2)... 79,685 75,299 72,923 72,524 76,283 Total , , , , ,955 Notes: (1) Source: Illinois Department of Employment Security. (2) Includes unclassified establishments. Following are lists of large employers located in the City and in the surrounding area. Major City Employers(1) Approximate Name Product/Service Employment Kane County... County Government... 1,260 Delnor-Community Hospital... General Hospital... 1,159 Geneva School District... School District Peacock Engineering Co.... Packaging and Assembly Burgess Norton Mfg. Co.... Screw Machine Products Johnson Controls, Inc., Battery Group... Automobile Batteries Houghton-Mifflin Co.... Wholesale Educational Textbooks FONA International, Inc.... Flavoring for Food Power Packaging... Packaging of Food Mixes Continental Envelope Corp.... Envelopes Miner Enterprises, Inc.... Railroad Equipment Note: (1) Source: 2013 Illinois Manufacturers Directory, 2013 Illinois Services Directory and a selective telephone survey. Major Area Employers(1) Approximate Location Name Product/Service Employment Elgin... Elgin School District U Public School District... 4,170 Naperville... Alcatel-Lucent... Telecommunications Research... 3,000 Naperville... Edward Hospital... General Hospital... 3,000 Aurora... Caterpillar, Inc.... Construction Machinery... 2,300 Naperville... Nicor Gas... Gas Utility... 2,264 Elgin... Sherman Hospital... General Hospital... 2,200 Aurora... Rush-Copley Medical Center... General Hospital... 2,000 Batavia... Fermi Research Alliance... High Energy Physics Research Laboratory... 1,800 Naperville... BP, Global Fuels Technology Division... Chemical Research... 1,600 Naperville... Office Max, Inc.... Wholesale Office Equipment and Supplies... 1,500 Aurora... Provena Mercy Medical Center... Medical and Psychiatric Hospital... 1,300 Elgin... Provena St. Joseph Hospital... General Hospital... 1,300 Aurora... Dreyer Medical Clinic... Medical Services... 1,200 Elgin... John B. Sanfilippo & Son, Inc.... Corporate Headquarters and Snack Foods... 1,200 Naperville... Nalco Co., & Ecolabs, Inc.... Chemical Research... 1,200 Note: (1) Source: 2013 Illinois Manufacturers Directory, 2013 Illinois Services Directory and a selective telephone survey. 9

14 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 The following tables show employment by industry and by occupation for the City, the County and the State as reported by the U.S. Census Bureau American Community Survey 5-year estimated values. Employment By Industry(1) The City Kane County State of Illinois Classification Number Percent Number Percent Number Percent Agriculture, Forestry, Fishing and Hunting, and Mining % 1, % 63, % Construction % 16, % 343, % Manufacturing... 1, % 41, % 775, % Wholesale Trade % 10, % 196, % Retail Trade... 1, % 28, % 659, % Transportation and Warehousing, and Utilities % 12, % 355, % Information % 5, % 135, % Finance, Insurance, Real Estate, and Rental and Leasing % 18, % 466, % Professional, Scientific, Management, Administrative, and Waste Management Services... 1, % 31, % 662, % Educational, Health and Social Services... 2, % 45, % 1,337, % Arts, Entertainment, Recreation, Accommodation and Food Services % 18, % 524, % Other Services (Except Public Administration) % 9, % 288, % Public Administration % 5, % 232, % Total... 10, % 245, % 6,043, % Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to Employment By Occupation(1) The City Kane County State of Illinois Classification Number Percent Number Percent Number Percent Management, Professional, and Related Occupations... 5, % 84, % 2,167, % Service Occupations... 1, % 35, % 1,007, % Sales and Office Occupations... 2, % 65, % 1,550, % Natural Resources, Construction, and Maintenance Occupations % 19, % 474, % Production, Transportation, and Material Moving Occupations % 40, % 843, % Total... 10, % 245, % 6,043, % Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to Unemployment rates for the City, the County and the State are shown below. Annual Average Unemployment Rates(1) Calendar The Kane State of Year City County Illinois % 6.7% 6.7% % 6.1% 6.2% % 5.8% 5.8% % 4.3% 4.6% % 4.8% 5.1% % 6.2% 6.4% % 10.2% 10.0% % 10.5% 10.4% % 9.8% 9.7% % 8.8% 8.9% 2013(2)... N/A 8.2% 9.0% Notes: (1) Source: Illinois Department of Employment Security. (2) Preliminary for the month of August

15 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 Building Permits The City's tax base has grown substantially in the last ten years, due to the City's location in the center of the Fox Valley region and proximity to the Interstate 90 "Golden Corridor" and East-West Tollway "Research and Development Corridor." Growth has been primarily residential with supporting commercial and retail development. Housing The U.S. Census Bureau 5-year estimated values reported that the median value of the City s owner-occupied homes was $330,700. This compares to $241,600 for the County and $198,500 for the State. The following table represents the five year average market value of specified owner-occupied units for the City, County and the State at the time of the American Community Survey. Specified Owner-Occupied Units(1) The City Kane County State of Illinois Value Number Percent Number Percent Number Percent Under $50, % 2, % 218, % $50,000 to $99, % 4, % 451, % $100,000 to $149, % 12, % 464, % $150,000 to $199, % 26, % 518, % $200,000 to $299, , % 39, % 725, % $300,000 to $499, , % 34, % 613, % $500,000 to $999, % 9, % 234, % $1,000,000 or more % 1, % 53, % Total... 6, % 129, % 3,279, % Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to Mortgage Status(1) The City Kane County State of Illinois Number Percent Number Percent Number Percent Housing Units with a Mortgage... 4, % 102, % 2,272, % Housing Units without a Mortgage... 1, % 27, % 1,006, % Total... 6, % 129, % 3,279, % Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to Income Per Capita Personal Income for the Ten Highest Income Counties in the State(1) Rank Lake County... $38, DuPage County... 38, McHenry County... 32, Monroe County... 31, Kendall County... 31, Will County... 30, Cook County... 29, Woodford County... 29, Kane County... 29, Sangamon County... 29,167 Note: (1) Source: U.S. Bureau of the Census American Community 5-Year Estimates. 11

16 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 The following shows a ranking of median family income for the Chicago metropolitan area from the American Community Survey. Ranking of Median Family Income(1) Ill. Family Ill. County Income Rank DuPage County... $94,049 1 Lake County... 93,260 2 Kendall County... 90,696 3 McHenry County... 87,133 4 Will County... 86,372 5 Kane County... 79,686 7 Cook County... 65, Note: (1) Source: U.S. Bureau of the Census American Community 5-Year Estimates. The U.S. Census Bureau 5-year estimated values reported that the City had a median family income of $104,848. This compares to $79,686 for the County and $69,658 for the State. The following table represents the distribution of family incomes for the City, the County and the State at the time of the American Community Survey. Family Income(1) The City Kane County State of Illinois Value Number Percent Number Percent Number Percent Under $10, % 3, % 131, % $10,000 to $14, % 2, % 86, % $15,000 to $24, % 6, % 224, % $25,000 to $34, % 9, % 260, % $35,000 to $49, % 14, % 389, % $50,000 to $74, % 23, % 606, % $75,000 to $99, % 20, % 486, % $100,000 to $149, , % 25, % 547, % $150,000 to $199, % 11, % 212, % $200,000 or more % 10, % 207, % Total... 5, % 127, % 3,153, % Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to

17 City of Geneva, Kane County, Illinois $1,505,000 General Obligation Refunding Bonds (Electric System Alternate Revenue Source), Series 2013 The U.S. Census Bureau 5-year estimated values reported that the City had a median household income of $95,467. This compares to $69,496 for the County and $56,576 for the State. The following table represents the distribution of household incomes for the City, the County and the State at the time of the American Community Survey. Household Income(1) The City Kane County State of Illinois Value Number Percent Number Percent Number Percent Under $10, % 6, % 324, % $10,000 to $14, % 5, % 225, % $15,000 to $24, % 12, % 480, % $25,000 to $34, % 14, % 462, % $35,000 to $49, % 20, % 628, % $50,000 to $74, , % 31, % 884, % $75,000 to $99, , % 25, % 627, % $100,000 to $149, , % 29, % 656, % $150,000 to $199, , % 12, % 243, % $200,000 or more... 1, % 11, % 238, % Total... 7, % 169, % 4,773, % Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to Retail Activity Following is a summary of the City s sales tax receipts as collected and disbursed by the State. Retailers Occupation, Service Occupation and Use Tax(1) State Fiscal Year State Sales Tax Annual Percent Ending June 30 Distributions(2) Change + (-) $4,825, %(3) ,017, % ,318, % ,267,436 (0.96%) ,034,190 (4.43%) ,447,640 (11.65%) ,361,085 (1.95%) ,542, % ,742, % ,844, % Notes: (1) Source: Illinois Department of Revenue. (2) Tax distributions are based on records of the Illinois Department of Revenue relating to the 1% municipal portion of the Retailers Occupation, Service Occupation and Use Tax, collected on behalf of the City, less a State administration fee. The municipal 1% includes tax receipts from the sale of food and drugs which are not taxed by the State. (3) The 2004 percentage is based on a 2003 sales tax of $4,156,492. Geneva Commons opened in