ADDENDUM DATED APRIL 26, 2010 OFFICIAL STATEMENT DATED APRIL 13, 2010

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1 NEW ISSUE Investment Rating: Moody s Investors Service Aaa ADDENDUM DATED APRIL 26, 2010 OFFICIAL STATEMENT DATED APRIL 13, 2010 $3,000,000 CITY OF HIGHLAND PARK Lake County, Illinois Taxable General Obligation Bonds, Series 2010A (Recovery Zone Economic Development Bonds - Direct Payment) AMOUNT, MATURITY, INTEREST RATE, YIELD AND CUSIP NUMBER $3,000, % Term Bonds due December 30, 2031; Yield 5.600%; CUSIP Number UR9 For further details see MANDATORY REDEMPTION herein. The Official Statement of the City dated April 13, 2010 (the "Official Statement") with respect to the Bonds is incorporated by reference herein and made a part hereof. The "Final Official Statement" of the City with respect to the Bonds as that term is defined in Rule 15c2-12 of the Securities and Exchange Commission shall be comprised of the following: 1. Official Statement dated April 13, 2010; and 2. This Addendum dated April 26, No dealer, broker, salesman or other person has been authorized by the City to give any information or to make any representations with respect to the Bonds other than as contained in 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 City. Certain information contained in the Final Official Statement may be obtained from sources other than records of the City and, while believed to be reliable, is not guaranteed as to completeness. NEITHER THE DELIVERY OF THE OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE THEREUNDER SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CITY SINCE THE DATE THEREOF. The City has authorized preparation of the Final Official Statement containing pertinent information relative to the Bonds and the City. Copies of that Final Official Statement can be obtained from the Underwriter, as defined herein. Additional information may also be obtained from the City or from the independent public finance consultants to the City: Established 1954 Speer Financial, Inc. INDEPENDENT PUBLIC FINANCE CONSULTANTS ONE NORTH LASALLE STREET, SUITE 4100 CHICAGO, ILLINOIS Telephone: (312) ; Facsimile: (312)

2 MANDATORY REDEMPTION The Bonds maturing on December 30, 2031, are subject to mandatory redemption, in part by lot, on December 30, 2030, consisting of a sinking fund payment at a redemption price equal to the principal amount thereof in the following principal amount on December 30, in the year set forth below: Year Principal Amount $1,475,000 The final principal amount of the Bonds maturing on December 30, 2031, is $1,525,000. All of the Bonds subject to mandatory sinking fund redemption shall be redeemed at a redemption price equal to the principal amount thereof to be redeemed. The Bond Registrar is authorized and directed to mail notice of mandatory sinking fund redemption of the Bonds in the manner provided in the Bond Ordinance. Whenever the Bonds subject to mandatory sinking fund redemption are redeemed at the option of the City, the principal amount thereof so redeemed shall be credited against the unsatisfied balance of further sinking fund installments or final maturity amount established with respect to such Bonds, in such amount and against such installments or final maturity amount as shall be determined by the City in the proceedings authorizing such optional redemption or, in the absence of such determination, shall be credited against the unsatisfied balance of the applicable sinking fund installments next ensuing, and with respect to which notice of redemption has not yet been given. INVESTMENT RATING The Bonds have been rated "Aaa" by Moody's Investors Service. The City has supplied certain information and material concerning the Bonds and the City to the rating service shown on the cover page as part of its application for an investment rating on the Bonds. Generally, such rating service bases its rating on such information and material, and also on such investigations, studies and assumptions that it may undertake independently. There is no assurance that such rating will continue for any given period of time or that it may not be lowered or withdrawn entirely by such rating service if, in its judgment, circumstances so warrant. Any such downward change in or withdrawal of such rating may have an adverse effect on the secondary market price of the Bonds. The City and the Underwriters have undertaken no responsibility either to bring to the attention of the registered owners of the Bonds any proposed change in or withdrawal of such rating or to oppose any such revision or withdrawal (other than to comply with any applicable continuing disclosure requirements). An explanation of the significance of investment ratings may be obtained from the rating agency: Moody's Investors Service, 7 World Trade Center at 250 Greenwich Street, New York, NY 10007, telephone UNDERWRITING The Bonds were offered for sale by the City at a public, competitive sale on April 26, The best bid submitted at the sale was submitted by Mesirow Financial, New York, New York, and associates (the "Underwriter"). The City awarded the contract for sale of the Bonds to the Underwriter at a price of $ $2,990, The Underwriter has represented to the City that the Bonds have been subsequently re-offered to the public initially at the yields set forth in this Addendum. ADDITIONAL INFORMATION References herein to laws, rules, regulations, 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. 2

3 AUTHORIZATION The Official Statement dated April 13, 2010, and this Addendum dated April 26, 2010, for the $3,000,000 Taxable General Obligation Bonds, Series 2010A, have been prepared under the authority of the City and have been authorized for distribution by the City. /s/ MICHAEL D. BELSKY Mayor CITY OF HIGHLAND PARK Lake County, Illinois /s/ ELIZABETH HOLLEB Director of Finance CITY OF HIGHLAND PARK Lake County, Illinois 3

4 NOTICE OF CORRECTION FOR $3,000,000* CITY OF HIGHLAND PARK Lake County, Illinois Taxable General Obligation Bonds, Series 2010A (Recovery Zone Economic Development Bonds - Direct Payment) Selling on: Monday, April 26, :00-10:15 A.M., C.D.T. (Open Speer Auction) Referencing the Official Statement and the Official Notice of Sale dated April 13, 2010, for the above referenced bond issue: THE TOTAL BOND YEARS AND AVERAGE LIFE SHOULD BE REVISED AS FOLLOWS: TOTAL BOND YEARS: 63, AVERAGE LIFE: Years Revised April 20, 2010 For additional information please contact Speer Financial, Inc., Suite 4100, One North LaSalle Street, Chicago, Illinois 60602; telephone (312) ; FAX (312)

5 REVISED OFFICIAL BID FORM (Open Speer Auction) City of Highland Park April 26, St. Johns Avenue Speer Financial, Inc. Highland Park, Illinois City Council Members: For the $3,000,000* Taxable General Obligation Bonds, Series 2010A (the Bonds ), of the City of Highland Park, Lake County, Illinois (the City ), as described in the annexed Official Notice of Sale, which is expressly made a part of this bid, we will pay you $ (no less than $2,973,000). The dated date and delivery date for the Bonds is expected to be on or about May 10, The Bonds are to bear interest as follows (each rate a multiple of 1/8 or 1/100 of 1%). The winning bidder s total compensation for the Bonds must not exceed $27,000, including the cost of any bond insurance purchased by the winning bidder. The premium or discount, if any, is subject to adjustment allowing the same $ gross spread per $1,000 bond as bid herein. MATURITIES* DECEMBER 30 Maximum Maximum Expected Permitted Expected Permitted Principal Due Interest Reoffering Reoffering Principal Due Interest Reoffering Reoffering Amount* Dec. 30 Rate Price(1) Price(2)(3) Amount* Dec. 30 Rate Price(1) Price(2)(3) $1,475, % % % $1,525, % % % Notes: (1) The first price at which 10% of the Bonds of that maturity are reasonably expected to be sold to the public, excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers. (2) The maximum first price at which 10% of the Bonds of that maturity may be sold to the public, excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers. (3) For term Bonds, the Maximum Permitted Reoffering Price is the average maximum indicated price weighted by the principal amount due by mandatory redemption or maturity. Consecutive maturities may be aggregated into a term bond at the option of the bidder, in which case the mandatory redemption provisions shall be on the same schedule as above. Maturities: Term Maturity The Bonds are to be executed and delivered to us in accordance with the terms of this bid accompanied by the approving legal opinion of Chapman and Cutler LLP, Chicago, Illinois. The City will pay for the legal opinion. The underwriter agrees to apply for CUSIP numbers within 24 hours and pay the fee charged by the CUSIP Service Bureau and will accept the Bonds with the CUSIP numbers as entered on the Bonds. As evidence of our good faith, we have wire transferred or enclosed herewith a check or Surety Bond payable to the order of the Treasurer of the City in the amount of TWO PERCENT OF PAR (the Deposit ) under the terms provided in your Official Notice of Sale. Attached hereto is a list of members of our account on whose behalf this bid is made. Form of Deposit Account Manager Information Bidders Option Insurance Check One: We have purchased Name insurance from: Certified/Cashier s Check [ ] Financial Surety Bond [ ] Address Name of Insurer (Please fill in) Wire Transfer [ ] By Amount: $60,000 City State/Zip Premium: Direct Phone ( ) FAX Number ( ) Address Maturities: (Check One) [ ] Years [ ] All The foregoing bid was accepted and the Bonds sold by ordinance of the City on April 26, 2010, and receipt is hereby acknowledged of the good faith Deposit which is being held in accordance with the terms of the annexed Official Notice of Sale. CITY OF HIGHLAND PARK, LAKE COUNTY, ILLINOIS Mayor Gross Interest $ Less Premium/Plus Discount $ True Interest Cost $ NOT PART OF THE BID (Calculation of true interest cost) True Interest Rate % TOTAL BOND YEARS 63, AVERAGE LIFE Bid Years Post Sale Revision

6 New Issue Investment Rating: Date of Sale: Monday, April 26, 2010 Moody s Investors Service Aaa 10:00-10:15 A.M., C.D.T. (Outstanding - Review Requested) (Open Speer Auction) Official Statement Interest on the Bonds is includible in gross income of the owners thereof for federal income tax purposes. Interest on the Bonds is not exempt from present State of Illinois income taxes. See TAX TREATMENT herein for a more complete discussion. $3,000,000* CITY OF HIGHLAND PARK Lake County, Illinois Taxable General Obligation Bonds, Series 2010A (Recovery Zone Economic Development Bonds - Direct Payment) Dated Date of Delivery Book-Entry Due Serially December 30, 2030 and 2031 The $3,000,000* Taxable General Obligation Bonds, Series 2010A (the Bonds ), are being issued by the City of Highland Park, Lake County, Illinois (the City ). Interest is payable semiannually on June 30 and December 30 of each year, commencing December 30, 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 on December 30, in the following years and amounts. Interest is calculated based on a 360-day year of twelve 30-day months. AMOUNT*, MATURITY, INTEREST RATE, PRICE OR YIELD AND CUSIP NUMBERS Maximum Maximum Principal Due Interest Reoffering Permitted CUSIP Principal Due Interest Reoffering Permitted CUSIP Amount* Dec. 30 Rate Price Price Number Amount* Dec. 30 Rate Price Price Number $1,475, % % % $1,525, % % % Consecutive maturities may be aggregated into a term bond at the option of the bidder, in which case the mandatory redemption provisions shall be on the same schedule as above. OPTIONAL REDEMPTION The Bonds are callable in whole or in part on any date on or after December 30, 2019, at a price of par and accrued interest. If less than all the Bonds are called, they shall be redeemed in such principal amounts and from such maturities as determined by the City and within any maturity by lot. See OPTIONAL REDEMPTION herein. PURPOSE, LEGALITY AND SECURITY The Bonds proceeds will be used to finance improvements to the City s waterworks system and to pay the cost of issuance of the Bonds. See THE PROJECT herein. In the opinion of Chapman and Cutler LLP, Chicago, Illinois, Bond Counsel, the Bonds will constitute valid and legally binding obligations of the City payable both as to principal and interest from ad valorem taxes levied against all taxable property therein without limitation as to rate or amount, except that the rights of the owners of the Bonds and the enforceability of the Bonds may be limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws affecting creditors rights and by equitable principles, whether considered at law or in equity, including the exercise of judicial discretion. This Official Statement is dated April 13, 2010, and has been prepared under the authority of the City. An electronic copy of this Official Statement is available from the web site under Debt Auction Center/Official Statement Competitive Sales Calendar. Additional copies may be obtained from Ms. Elizabeth Holleb, Director of Finance, City of Highland Park, 1707 St. Johns Avenue, Highland Park, Illinois , or from the Independent Public Finance Consultants to the City: Established 1954 Speer Financial, Inc. INDEPENDENT PUBLIC FINANCE CONSULTANTS ONE NORTH LASALLE STREET, SUITE 4100 CHICAGO, ILLINOIS Telephone: (312) ; Facsimile: (312)

7 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A For purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, this document, as the same may be supplemented or corrected by the City from time to time (collectively, the Official Statement ), may be treated as an Official Statement with respect to the Bonds described herein that is deemed near final as of the date hereof (or the date of any such supplement or correction) by the City. The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts and interest rates of the Bonds, together with any other information required by law or deemed appropriate by the City, shall constitute a Final Official Statement of the City with respect to the Bonds, as that term is defined in Rule 15c2-12. Any such addendum shall, on and after the date thereof, be fully incorporated herein and made a part hereof by reference. No dealer, broker, salesman or other person has been authorized by the City 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 City. Certain information contained in the Official Statement and the Final Official Statement may have been obtained from sources other than records of the City 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 CITY 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 City, 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. 2

8 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A BOND ISSUE SUMMARY This Bond Issue Summary is expressly qualified by the entire Official Statement, which is provided for the convenience of potential investors and which should be reviewed in their entirety by potential investors. Issuer: City of Highland Park, Lake County, Illinois. Issue: $3,000,000* Taxable General Obligation Bonds, Series 2010A. Dated Date: Date of delivery. Interest Due: Each June 30 and December 30, commencing December 30, Principal Due: Optional Redemption: Authorization: Security: Credit Rating: Purpose: Tax Treatment: Bond Registrar/Paying Agent: Book-Entry Form: Denomination: Serially each December 30, commencing December 30, 2030 and 2031, as detailed on the front page of this Official Statement. The Bonds are callable at the option of the City on any date on or after December 30, 2019, at a price of par plus accrued interest. See OPTIONAL REDEMPTION herein. The City is a home-rule unit and under the 1970 Illinois Constitution, has no debt limitation. The Bonds will constitute valid and legally binding obligations of the City payable both as to principal and interest from ad valorem taxes levied against all taxable property therein without limitation as to rate or amount. The City s outstanding general obligation rating is Aaa from Moody s Investors Service; a rating for the Bonds has been requested. The Bonds proceeds will be used to finance improvements to the City s waterworks system and to pay the cost of issuance of the Bonds. See THE PROJECT herein. Interest on the Bonds is includible in gross income of the owners thereof for federal income tax purposes. Interest on the Bonds is not exempt from present State of Illinois income taxes. See TAX TREATMENT herein for a more complete discussion. Amalgamated Bank of Chicago, Chicago, Illinois. 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. Delivery: The Bonds are expected to be delivered on or about May 10, Financial Advisor: Speer Financial, Inc., Chicago, Illinois. 3

9 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A CITY OF HIGHLAND PARK Lake County, Illinois Michael D. Belsky Mayor Council Members James R. Kirsch Steven W. Mandel Nancy R. Rotering Scott Levenfeld Terri R. Olian Lawrence D. Silberman Officials Shirley Fitzgerald City Clerk Elizabeth Holleb Director of Finance David M. Limardi City Manager Ronald Zweig City Treasurer Steven M. Elrod Corporation Counsel THE CITY The City of Highland Park, Lake County, Illinois (the City ), encompassing an area of square miles, is located 26 miles north of the Chicago central business district and is one of eight Chicago suburban communities north of Chicago fronting on Lake Michigan collectively referred to as the North Shore. Its contiguous municipal neighbors to the north include Lake Forest and Highwood; to the west are Deerfield and Bannockburn; and to the south are Northbrook and Glencoe. The City s southern boundary is also the Lake County-Cook County boundary. The first settlers came to the area in 1845 and developed two villages, St. Johns and Port Clinton. In 1851 the first railroad tracks were laid (the present commuter rail line) with a depot located just south of Port Clinton and identified as Highland Park in recognition of the area s dense woods, ravines and lakeview bluffs. In 1868 the Highland Park Building Company began planning construction of a village. In 1869 the City of Highland Park was incorporated with a population of 500 and an area slightly less than 2 square miles, including the St. Johns and Port Clinton areas. By 1891 two of the present four private country clubs in the City had been formed and the City s reputation as an exclusive residential area had been established. Annexations in the period increased the City to an area of 12 square miles. After the most recent annexation of a portion of Fort Sheridan, the current area as measured by the City s geographical information system is miles. The opening during the 1950 s of the Edens Expressway from Chicago to a termination point in Highland Park contributed to a 51.9% population increase from 16,808 in 1950 to 25,532 at the 1960 Census, followed by a 26.4% increase to 32,263 at the 1970 Census, and a 5.1% decrease to 30,611 in Highland Park s population according to the 2000 Census, as amended, was 30,262, a decrease of 1.7% from the 1990 Census of 30,575. The City automatically became a home-rule unit when the 1970 Illinois Constitution was adopted because it had a population in excess of 25,000. As a home-rule unit, the City has no tax rate or debt limits, nor is it required to conduct a referendum to authorize the issuance of debt or to increase property taxes. 4

10 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Government Services The City is governed by a seven-member Council composed of a mayor and six council members elected on an at-large basis for four year, staggered terms. Pursuant to a 1951 referendum, the City operates under the Council- Manager form of government with an appointed City Manager responsible for the administration of policy set by the governing body, and day-to-day operations of the City. The Council also appoints a Treasurer, Clerk and Corporation Counsel. Of the City s 263 full-time positions, only the firefighters and police patrolmen are represented by collective bargaining agreements. The current four-year firefighter s contract expired on April 30, Patrolmen also have a four-year contract that expired on April 30, The City is currently negotiating new contracts. Police sergeants are currently negotiating an initial contract. The City currently has 27 facilities including parking decks, water tower and miscellaneous structures. Public safety was upgraded when the City-wide 911 telephone system was installed in An enhanced system automatically recording the street location of a telephone call was installed in The fire department operates from three fire stations, each of which have paramedics on duty with mobile intensive care units/ambulances. The City s Fire Department is one of only 133 departments worldwide and one of 12 in the State of Illinois to receive accreditation from the Commission on Fire Accreditation International and currently holds a class four fire insurance rating. The police department is structured to enable response to emergency calls anywhere in the City within three minutes. A boat is available for emergency use at all times. All uniformed police officers are trained to the levels of first responders. The cable television system serving the City has two-way signal availability. The City funds a significant list of special social service activities for both its youth and seniors citizens, operating separate senior citizen and youth centers. Both facilities provide educational, cultural and social activities for City residents. The Highland Park Public Library is a component unit of the City, administered by a nine person Library Board appointed by the Council. The core Library facility was built in 1930, remodeled and expanded in 1975, and further modernization was completed in The Library has approximately 211,000 volumes and 41,500 audiovisual materials, and has a circulation of 740,900 items. The number of current card holders is 30,000. The City operates a fixed route scheduled bus service, the Ravinia Festival Park-n-Ride bus program and the free Senior Connector shuttle bus operation. For those senior citizens not near a bus route, Deerfield Township subsidizes a cab ride anywhere in the Township. Both the fixed route and Park-n-Ride programs are operated by the City under a direct subsidy agreement from the Suburban Bus Division (PACE) of the Regional Transportation Authority. City Water System The City draws water from Lake Michigan and is the sole source of supply for the adjacent Villages of Deerfield (2000 population of 18,420), Bannockburn (2000 population of 1,429), Lincolnshire (2000 population of 6,108) and the Glenbrook Sanitary District. The City has the capability to provide water, on an emergency basis, to Northbrook, Highwood and Lake Forest. The City s water service area, including the City, is approximately 23 square miles and serves approximately 60,000 people. The service area includes some residential areas and growing office/commercial developments, the latter primarily in Deerfield and Lincolnshire. 5

11 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Education The majority of City residents are served by Community Consolidated Elementary School District Number 112. School District Numbers 106 and 109 also serve City residents. One high school district (High School District Number 113) provides secondary education for the children of City residents. The enrollment of the School District Number 112 is approximately 4,400. High School District 113 enrollment is approximately 3,700. Higher education is provided by Lake Forest College in adjacent Lake Forest and by the College of Lake County, which is a two year community college with an estimated enrollment of 18,000. City residents also have access to the public and private colleges and universities in the Chicago metropolitan area. Recreation and Community Services The Park District of Highland Park is an independent unit of government providing recreational facilities within the City. An extensive array of public facilities at its 650 acres of parks features an outdoor aqua park which, supplements 5 miles of beaches on Lake Michigan, a boat launching ramp, an 18 hole golf course (Sunset Valley Golf Course), a miniature golf course, an indoor ice skating rink and an indoor tennis/racquetball facility. There are four private golf courses in the City, including the Northmoor, Bob O-Link, Exmoor and Old Elm courses. The Highland Park Country Club was acquired by the City in 1993 and its golf course together with the 18- hole Sunset Valley Golf Club owned by the Park District of Highland Park are public courses. The Highland Park Country Club facility was expanded with the construction of a recreation center adjacent to the main building. The Recreation Center opened in October The Ravinia Festival was founded in 1936, and is the nation s oldest outdoor summer performing arts festival. Located in the City on 36 acres of natural woodlands, Ravinia s summer schedule is in operation for 12 to 14 weeks each year. The world-renowned Chicago Symphony Orchestra is in residence for eight of these weeks each summer. Ravinia features an open-air, covered Pavilion that seats 3,200 and is used for a variety of music and dance performances. The Martin Theatre, an indoor venue, seats 850 and is used for chamber music performances and recitals. Bennett-Gordon Hall, another indoor venue, seats 450 and is used for Steans Institute concerts and a few select dance recitals and workshops. Ravinia Festival presents its Rising Stars concert series October through May in Bennett-Gordon Hall, which features the best young artists in classical music. A new, two-story dining pavilion opened at the beginning of the 2007 season. Several locations offer festival attendees a variety of foodservice options in three restaurants in addition to a private dining area and dining club. Located in the nearby Village of Glencoe on 385 acres, the Chicago Botanic Garden serves the adjoining communities and the North Shore area. Approximately 900,000 people visit the Botanic Garden annually. It received museum accreditation from the American Association of Museums in 1986 and is a member of the Association of Science-Technology Centers. It is the only major botanic garden in Northern Illinois. It is open all year, seven days a week for jogging and hiking and seasonal floral displays. Highland Park Hospital, which is located in the City, is a not-for-profit corporation whose parent corporation, Northshore University HealthSystem, also owns a 30,000 square foot medical office building at the hospital complex and two immediate care centers in nearby communities. The hospital is a 239 bed full service hospital and currently employs approximately 1,200 people. The medical staff numbers approximately 465. Highland Park Hospital is a founding member of the Northwest Health Care Network, which includes Children s Memorial Hospital, Evanston Hospital Corporation and Northwestern Memorial Hospital. The hospital provides medical care and services for the residents of the City as well as Lake County and northern Cook County. In addition to the medical office building an ambulatory care center is nearing completion and two new parking structures, including a four level structure, have been completed. Historic Preservation The City is empowered to designate local historic landmarks by a locally adopted preservation ordinance. This local landmark designation affords properties more protection than the State or National programs. Once a property is locally designated, any exterior alteration, construction, demolition or removal requiring a building permit is reviewed by the Highland Park Historic Preservation Commission (the Commission ). 6

12 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A The City has a wealth of historically and culturally significant properties, with 127 individual properties and three historic districts listed on the National Register. To date, 85 properties have been designated as local landmarks. Most of the significant properties which have been identified in the City are located east of the Skokie Corridor. In addition to landmarking single-family homes, the Commission has recognized the City s water tower, several parks, a school, a fountain, a log cabin, and the Ravinia Festival grounds. The City strives to preserve its distinctive historic, architectural and landscape characteristics. Overview SOCIOECONOMIC INFORMATION While primarily a residential community, the City s business base has experienced excellent growth over the last 15 years. There are three main commercial areas in the City, the central business district, activity along the Skokie Corridor, and the small Ravinia business district. The Skokie Corridor has several car dealerships, the Crossroads Shopping Center, and other commercial businesses. The City estimates that approximately 60% of its sales tax receipts come from the Skokie Corridor and approximately 30% from the central business area. The Central Business District (the CBD ) has been the focus of significant City attention and development during the 1980 s. In 1981 the CBD Tax Increment District (the TIF District ) was created, encompassing approximately 120 acres and covering the entire central business area. Redevelopment began when the City purchased a city block, which it still owns through a land lease. The City constructed a plaza and an underground, two-level municipal garage in Private developers have also constructed two office/retail and retail/residential buildings on the target site. Additional private development has also occurred in the TIF District, including construction of a large apartment complex, a major bank facility expansion and various, major new retail projects. Renaissance Place is a recent development within the CBD. This development encompasses almost an entire block within the CBD (approximately 113,000 square feet) consisting of retail stores, including the anchor of Saks Fifth Avenue (approximately 50,000 square feet), Restoration Hardware, Pottery Barn and others. Retail space, exclusive of Saks Fifth Avenue is approximately 65,000 square feet. In addition, Renaissance Place includes office space (40,000 square feet), restaurants (9,000 square feet), 32 rental apartments, fine arts theaters (16,600 square feet) and underground parking with 528 spaces. The City has financed approximately $20,000,000 of public improvements in the TIF District, including major utility, street and related infrastructure improvements, as well as a variety of streetscape improvements. The debt service on such improvements was supported through the TIF increment. The TIF increment in the central business district had grown from zero to $38,788,639 in levy year 1998, indicating significant growth in property values and private reinvestment in the area. The City extended the estimated completion date of the central business district TIF to December 31, 2004, and redefined the boundaries by adding and removing parcels within the TIF. Effective levy year 1999, $40,077,588 of equalized assessed valuation was added back to the tax rolls consisting entirely of commercial property. The TIF increment for the redefined TIF was $13,855,073 for levy year The TIF has now expired. The City had a second TIF district, the Skokie Corridor District, which was dissolved effective levy year In July of 2005, the City created a TIF district in the Ravinia Business District. A portion of the former Fort Sheridan Army installation located on Lake Michigan in northern Highland Park is in the process of redevelopment in accordance with the Fort Sheridan Conceptual Land Use Plan. A total of 551 total dwelling units consisting of single family and multi-family housing units are included in the development. Of these, 75 buildings were listed on the Federal Register of Historic Places and are being converted into residences. The Fort Sheridan Local Redevelopment Authority and the Fort Sheridan Joint Planning Commission (represented by members from both Highland Park and Highwood) have provided assistance in coordinating planning efforts in order to ensure a smooth transition in the annexation of former unincorporated land and conversion of non-taxable properties onto City tax rolls. The Navy (southeast section) and the Army Reserves (southwest section) are using the remaining portion of Fort Sheridan. 7

13 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A The table below recaps the 1987, 1992, 1997, and 2002 Business Censuses. Business Census Statistics 1987 to 2002 Percent Increase in Sales/Receipts/ Census of Business Value Added by Retail Trade (1) 2002(1) Manufacture Number of Establishments Number of Employees... 3,710 3,958 2,419 3,156 Sales(000)... $439,229 $644,515 $ 570,536 $815, % Wholesale Trade Number of Establishments Number of Employees... Withheld Sales(000)... Withheld $865,320 $1,106,062 $689,870 (20.3%)(3) Services(2) Number of Establishments Number of Employees... 2,391 2,334 3,851 6,606 Receipts(000)... $134,918 $184,777 $ 286,881 $584, % Manufacturing Number of Establishments Number of Employees... 1,200 1,100 Withheld 2,120 Value Added by Manufacture(Millions)... $ 54.3 $ 59.6 Withheld $ % Notes: (1) The 1997 and 2002 Census of Business are not directly comparable to the previous years. Unlike earlier censuses, industries are classified according to the North American Industry Classification System ( NAICS ). Previously, industries were classified according to the Standard Industrial Codes ( SIC ). (2) The 2002 Census is the latest available. Information has been withheld to protect the identity of individual companies. Censuses listed under services includes the following categories, not separately detailed before: Information; Professional, Scientific and Technical Services; Educational Services; Health Care and Social Assistance; Arts, Entertainment and Recreation; Accommodations and Foodservices; Other Services (except Public Administration); Management of Companies and Enterprises; and Administrative Support and Waste Management and Remediation Services. (3) Decrease from 1992 to Employment The City is primarily residential in character, with a few significant employers. Employment opportunities in neighboring towns are significant, as are opportunities throughout the Chicago metropolitan area. Following are large employers located in the City and in immediately surrounding communities. Major City Employers(1) Approximate Name Product/Service Employment Highland Park Hospital... General hospital... 1,200 School District No Elementary school district Ravinia Festival... Music festival (2) North Suburban Special Education District... Special education district Township High School District No High school district City of Highland Park... Governmental services The Pickus Cos.... Commercial and industrial building contractors and designers Highland Park Public Library... Public library Highland Park Post Office... Post office Highland Park Ford Sales, Inc.... Automotive dealership Mesirow Financial... Investment brokers Audi Exchange... New and used motor vehicles Idlewood Electric Supply... Wholesale electrical supplies Notes: (1) Source: 2010 Illinois Manufacturers Directory, 2010 Illinois Services Directory and selective telephone survey. (2) Includes full-time and seasonal employees. 8

14 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Major Area Employers(1) Approximate Location Name Product/Service Employment Northbrook... Allstate Insurance... Insurance corporate office... 5,750 Deerfield... Takeda Pharmaceuticals North America, Inc... Corporate headquarters and pharmaceutical preparations... 3,080 Deerfield... Walgreen Co.... Drug store corporate office... 2,500 Lake Forest... Lake Forest Hospital... Hospital... 1,600 Northbrook... Underwriters Laboratories... Independent non-profit testing... 1,600 Deerfield... Baxter International, Inc.... Wholesale medical supplies... 1,400 Lake Forest... Hospira, Inc.... Corporate headquarters and surgical and medical instruments. 1,350 Lake Forest... W.W. Grainger Co., Inc.... Corporate headquarters... 1,200 Northbrook... Caremark, Inc... Integrated health care system... 1,000 Lake Forest... Trustmark Mutual Holding Co.... Life insurance Deerfield... Astellas Pharma US, Inc.... Corporate headquarters and wholesale pharmaceutical products 800 Deerfield... United Stationers... Corporate headquarters and wholesale office furniture Lake Forest... Stericycle, Inc.... Medical waste management Deerfield... Trinity International University... Christian liberal arts university Northbrook... Crate & Barrel... Company headquarters and housewares and furnishings Notes: (1) Source: 2010 Illinois Manufacturers Directory, 2010 Illinois Services Directory and selective telephone survey. The following tables show employment by industry and by occupation for the City, Lake County and the State of Illinois as of the 2000 Census. Employment By Industry(1) The City Lake County State of Illinois Classification Number Percent Number Percent Number Percent Agriculture, Forestry, Fishing, Hunting, and Mining % % 66, % Construction % 19, % 334, % Manufacturing... 1, % 61, % 931, % Wholesale Trade % 15, % 222, % Retail Trade... 1, % 35, % 643, % Transportation and Warehousing, and Utilities % 11, % 352, % Information % 8, % 172, % Finance, Insurance, Real Estate, Rental and Leasing... 1, % 28, % 462, % Professional, Scientific, Management, Administrative, and Waste Management Services... 3, % 38, % 590, % Educational, Health and Social Services... 3, % 51, % 1,131, % Arts, Entertainment, Recreation, Accommodation and Food Services... 1, % 18, % 417, % Other Services (Except Public Administration) % 12, % 275, % Public Administration % 8, % 231, % Total... 15, % 310, % 5,833, % Note: (1) Source: U.S. Bureau of the Census. Employment By Occupation(1) The City Lake County State of Illinois Classification Number Percent Number Percent Number Percent Management, Professional and Related Occupations... 8, % 127, % 1,993, % Service... 1, % 34, % 813, % Sales and Office... 4, % 87, % 1,609, % Farming, Fishing and Forestry % % 17, % Construction, Extraction, and Maintenance % 23, % 480, % Production, Transportation, and Material Moving % 36, % 917, % Total... 15, % 310, % 5,833, % Note: (1) Source: U.S. Bureau of the Census. 9

15 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Unemployment rates for the City are well below Lake County and State of Illinois levels, as shown below. Annual Average Unemployment Rates(1) Calendar The Lake State of Year City County Illinois % 4.6% 5.4% % 5.7% 6.5% % 6.0% 6.7% % 4.7% 5.5% % 4.5% 5.8% % 4.7% 4.5% % 5.1% 5.1% % 6.7% 6.5% % 9.8% 10.1% 2010(2) % 13.4% 12.0% Notes: (1) Source: Illinois Department of Employment Security. (2) Preliminary rates for the month of February Building Permits New residential building permits have averaged $519,117 over the last three fiscal years in the City, excluding the value of land. This is higher than the City s 2000 Census median home value of $380,000, which included land. City Building Permits(1) (Excludes the Value of Land) New Residential Industrial & Fiscal Single Family Multiple Family Residential Commercial, Year Average Additions & Including Miscellaneous Total 4/30 Units Total Value Value Units Value Alterations Additions Value Value $36,718,784 $386, $8,937,448 $24,469,919 $14,761,177 $ 490,000 $ 85,377, ,803, , ,622,382 17,189,155 14,486,282 1,450,000 67,551, ,559, , ,090,000 30,354,848 5,500,268 5,520,000 80,024, ,346, , ,000 20,242,586 11,384,774 7,653,000 68,846, ,642, , ,372,000 26,243,943 52,842,793 4,259, ,360, ,130, , ,162,000 32,006,723 23,096,269 6,536,190 97,931, ,140, , ,886,000 39,619,761 41,961, , ,566, ,324, , ,980,000 45,063,373 26,750,050 2,858, ,975, (2) ,076, , ,014,000 36,179,529 14,125,200 2,000,560 92,395, (2) ,521, , ,735,000 20,010,030 10,738, ,000 54,834,334 Notes: (1) Source: the City. (2) For fiscal years ended December 31. Housing The 2000 Census reported that the median value of the City s owner-occupied homes was $380,000 which is 92% higher than the median value of $198,200 for Lake County and 190% higher than $130,800 for the State. The market value of specified owner-occupied units as of the 2000 Census was as follows: Specified Owner-Occupied Units(1) The City Lake County State of Illinois Value Number Percent Number Percent Number Percent Under $50, % % 230, % $50,000 to $99, % 13, % 651, % $100,000 to $149, % 33, % 583, % $150,000 to $199, % 28, % 429, % $200,000 to $299, , % 32, % 344, % $300,000 to $499, , % 26, % 163, % $500,000 to $999, , % 12, % 55, % $1,000,000 or more % 3, % 12, % Total... 8, % 150, % 2,470, % Note: (1) Source: U.S. Bureau of the Census. 10

16 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Income Per Capita Personal Income for the Ten Highest Income Counties in the State(1) Rank Lake County... $32, DuPage County... 31, McHenry County... 26, Kendall County... 25, Will County... 24, Kane County... 24, Cook County... 23, Sangamon County... 23, Monroe County... 22, Grundy County... 22,591 Note: (1) Source: U.S. Bureau of the Census. The following shows a ranking of median family income for the Chicago metropolitan area among 3,141 counties from the 2000 Census. Ranking of Median Family Income(1) Ill. Family Ill. County Income Rank DuPage County...$79,314 1 Lake County... 76,424 2 McHenry County... 71,553 3 Will County... 69,608 4 Kendall County... 69,383 5 Kane County... 66,558 6 Cook County... 53, Note: (1) Source: U.S. Bureau of the Census. The City is one of the wealthiest communities in the State, as seen through income statistics. According to the 2000 U.S. Census, the City had a median household income of $100,967, which compares to the median household income of $76,424 for Lake County and $46,590 for the State. The following table represents the distribution of household income in the City and Lake County at the time of the 2000 Census. Median Household Income(1) The City Lake County State of Illinois Income Number Percent Number Percent Number Percent Under $10, % 8, % 383, % $10,000 to $14, % 5, % 252, % $15,000 to $24, % 15, % 517, % $25,000 to $34, % 18, % 545, % $35,000 to $49, , % 28, % 745, % $50,000 to $74, , % 44, % 952, % $75,000 to $99, , % 31, % 531, % $100,000 to $149, , % 33, % 415, % $150,000 to $199, , % 12, % 119, % $200,000 or more... 2, % 17, % 128, % Total... 11, % 216, % 4,592, % Note: (1) Source: U.S. Bureau of the Census. 11

17 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Retail Activity The table below shows sales tax receipts collected by the City over the past nine years as an indicator of commercial activity. Retailers Occupation, Service Occupation and Use Tax(1) State Fiscal Year State Sales Tax Annual Ending June 30 Distribution (2) Change + (-) $ 7,881, %(3) ,957, % ,163, % ,564, %(4)(5) ,810, %(4)(5) ,074, %(4)(5) ,979, %(4)(5) ,347, %(4)(5) ,215,123 (0.99%)(4)(5) ,004,931 (9.16%)(4)(5) Growth from 2000 to % 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 2000 percentage is based on a 1999 sales tax of $7,324,285. (4) Not directly comparable to 2002 and prior years. Based on Standard Industrial Classification. (5) Includes Home Rule Sales Taxes. The State Statutes allow home rule municipalities to increase sales tax at a minimum of 0.25%. The Council approved an increase in 1995 of 0.50%. Effective January 1, 2003, the City increased its home rule municipal sales tax rate to 1.00%. The additional revenue is dedicated to abatement of debt service for capital improvements including the Recreation Center, land acquisition, parking structure, police headquarters, storm and sanitary sewer improvements, pedestrian overpass, and infrastructure maintenance and repair. THE PROJECT The Bonds are being issued as part of the multi-year program to finance improvements to the City s Water Treatment Plant (the Plant ). The project includes conversion to a micro-filtration membrane system and other Plant improvements that together will increase the water production capacity of the Plant from 21 million gallons per day ( MGD ) to 30 MGD. The City issued bonds in 2007 to pay the cost of preliminary design and to pay a portion of the costs of purchasing the membrane system. The proceeds of the Bonds will be used to pay the balance of the costs of purchasing the membrane system and completion of the design. The City intends to issue bonds in the fall of 2010 and in 2011 for the purpose of paying the costs of constructing the improvements to the Plant. The construction is expected to take approximately 18 to 24 months. In addition bond proceeds will be used to pay the costs of issuance. 12

18 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A DEBT INFORMATION After issuance of the Bonds, the City will have outstanding $52,976,925 (subject to change) principal amount of general obligation debt. The City plans to issue additional debt within the next six months. City General Obligation Bonded Debt(1) (Principal Only) Property Tax Supported Calendar Cumulative Year Total The Net Principal Tax Supported Principal Retired(2) (12-31) Outstanding Bonds(2) To Be Abated(2) Debt Amount Percent $3,830,468 $ 0 $ 840,468 $ 2,990,000 $ 2,990, % ,230, ,155,970 3,075,000 6,065, % ,396, ,211,497 3,185,000 9,250, % ,352, ,252,048 3,100,000 12,350, % ,622, ,627 2,850,000 15,200, % ,773, ,233 2,970,000 18,170, % ,478, ,868 1,620,000 19,790, % ,674, , ,000 20,575, % ,170, , ,000 20,795, % ,105, , ,000 21,025, % ,156, , ,000 21,265, % ,072, , ,000 21,515, % , , ,515, % , , ,515, % , , ,515, % , , ,515, % , , ,515, % , , ,515, % , , ,515, % , , ,515, % ,735 1,475,000 2,381, ,515, % ,018 1,525,000 2,478, ,515, % , , ,515, % , , ,515, % ,118, ,118, ,515, % Total... $49,976,925 $3,000,000 $31,461,925 $21,515,000 Notes: (1) For term bonds, mandatory redemption amounts are shown. (2) Subject to change. General Obligation Summary Bonded Debt - By Issue(1) Issue Amount Source of Debt Service Payments Series $ 4,560,000 Water Revenues and Property Taxes Series ,915,000 Property Taxes and Home Rule Sales Taxes Series 2004A... 9,620,609 Property Taxes Series 2004B... 6,056,317 Property Taxes Series 2005A... 8,505,000 Property Taxes and Home Rule Sales Taxes Series 2005B... 1,000,000 Water Revenues and Property Taxes Series ,530,000 Water Revenues and Property Taxes Series ,790,000 Water Revenues, Highland Park Country Club and Property Taxes Total... $49,976,925 Plus: The Bonds(2)... $ 3,000,000 Total(2)... $52,976,925 Water Revenues Notes: (1) Source: the City (2) Subject to change. 13

19 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Detailed Overlapping Bonded Debt(1) (As of January 25, 2010) Outstanding Applicable to the City Debt Percent(2) Amount(3) Schools: School District No $ 1,120, % $ 34,384 School District No ,640, % 685,152 School District No ,985, % 23,650,801 High School District No ,065, % 25,578,894 College of Lake County No ,545, % 723,619 Total Schools(3)... $50,672,850 Others: Lake County... $ 37,150, % $ 3,388,080 Lake County Forest Preserve District ,575, % 24,311,640 North Shore Sanitary District... 3,674, % 992,044 Deerfield Park District... 5,930, %(4) 297 Park District of Highland Park... 1,300, % 1,280,110 Total Other(3)... $29,972,170 Total Overlapping Debt(3)... $80,645,021 Notes: (1) Source: Lake County. (2) Overlapping debt percentages based on 2008 EAV, the most current available. (3) Due to rounding, totals may not be exact sums. (4) Percentage is less than 1/100 of 1%. Statement of Bonded Indebtedness(1) (As of January 25, 2010) Ratio To Per Capita Amount Equalized Estimated (2000 Census Applicable Assessed Actual 30,262) City EAV of Taxable Property, 2008(1)... $2,780,479, % 33.33% $ 91, Estimated Actual Value, $8,341,439, % % $275, Direct Bonded Debt(2)... $ 52,976, % 0.64% $ 1, Less: Self Supporting... (31,461,925) (1.13%) (0.38%) (1,039.65) Net Direct Bonded Debt(2)... $ 21,515, % 0.26% $ Overlapping Bonded Debt Schools... $ 50,672, % 0.61% $ 1, All Others... 29,972, % 0.36% Total Overlapping Bonded Debt... $ 80,645, % 0.97% $ 2, Total Net Direct & Overlapping Debt(2)... $ 102,160, % 1.22% $ 3, Notes: (1) Source: The City. Excludes 2008 incremental EAV of $2,849,947. (2) Subject to change. 14

20 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Trend of Debt Ratios and Per Capita Debt(1) Ratio to Estimated Actual Value Per Capita(2) Direct and Direct and Direct Debt Overlapping Debt Overlapping Debt Including Excluding Including Excluding Including Excluding City Issue Self- Self- Self- Self- Self- Self- Sale Date Amount Supporting Supporting(3) Supporting Supporting Supporting Supporting September 25, $ 2,500, % 0.39% 3.41% 3.01% 4, , December 10, ,000, % 0.32% 3.16% 2.80% 4, , December 9, ,000, % 0.40% 3.31% 2.99% 5, , December 8, ,000, % 0.50% 2.67% 2.44% 4, , November 8, ,590,000(5) 0.90% 0.71% 2.64% 2.45% 5, , November 28, ,000, % 0.78% 2.47% 2.31% 5, , December 14, ,075, % 0.78% 2.47% 2.31% 5, , December 10, ,000, % 0.61% 2.08% 1.87% 5, , March 24, ,790, % 0.26% 1.57% 1.22% 4, , April 26, 2010(6)... 3,000, % 0.26% 1.60% 1.22% 4, , Notes: (1) Taken from applicable Official Statements of the City. (2) The issues used a population estimate of 31,651. The 1991 through 2000 bond issues used the 1990 Census figure of 30,575. The 2001 and 2002 bond issues and the Bonds assume an amended 2000 Census figure of 30,262. (3) Excludes bonds expected to be abated from various sources. (4) Bank loan for tax increment financing district. (5) Series 2004A and Series 2004B. (6) Subject to change. PROPERTY ASSESSMENT AND TAX INFORMATION For the 2008 levy year, the City s EAV (excluding TIF increment) was comprised of 91.41% residential, 8.53% commercial, 0.02% farm and industrial, and 0.04% railroad property valuation. City Equalized Assessed Valuation(1) Levy Years Property Class: Residential... $1,889,593,213 $2,108,875,142 $2,304,476,442 $2,441,739,607 $2,541,673,622 Farm ,657 1,083,297 1,172, ,820 Commercial ,974, ,409, ,809, ,316, ,246,008 Industrial... 1,803,869 9,230 8, , ,017 Railroad , , ,925 1,007,223 1,082,378 Total Excluding TIFs... $2,042,643,752 $2,292,120,591 $2,510,402,825 $2,675,494,182 $2,780,479,845 TIF Incremental EAV... 13,855, ,000,600 2,462,182 2,849,685 Total Including TIFs... $2,056,498,825 $2,292,120,591 $2,513,403,425 $2,677,956,364 $2,783,329,530 Percent change +(-) %(2) 11.46% 9.65% 6.55% 3.93% Notes: (1) Source: the City. (2) Percentage based on 2003 total EAV of $1,920,105,204 and includes $12,296,947 of incremental EAV. 15

21 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Representative Tax Rates(1) (Per $100 Equalized Assessed Valuation) Levy Years The City(2): Corporate... $ $ $ $ $ Street and Bridge Library Pensions Bonds All Other(3) Total City... $ $ $ $ $ Others: Lake County & Forest Preserve District North Shore Sanitary District Park District of Highland Park Highland Park Elementary School District Number Township High School Number College of Lake County No All Other Total(4)... $ $ $ $ $ Notes: (1) Source: the City. (2) As a home rule unit under the 1970 Illinois Constitution, the City has no statutory tax rate or levy limitations. (3) Includes rates for: Public Benefit, Crossing Guard, Audit, Tax and Street Construction. (4) Representative tax rate is for Moraine Township Tax Code No which represents 48.3% of the City s 2008 Equalized Assessed Valuation. City Tax Extensions and Collections(1) (City Purposes Only) Levy Coll. Taxes Current Collections Year Year Extensions(2) Amount Percent $12,746,097 $12,598, % ,858,791 12,800, % ,355,343 13,284, % ,832,305 13,733, % (3)... 14,319,977 14,258, % Notes: (1) Source: Lake County Treasurer. (2) Tax extensions have not been adjusted for abatements. (3) In collection as of February 4, Principal City Taxpayers(1) Taxpayer Name Business/Service 2008 EAV(2) Renaissance Place, LLC... Business/Retail Center... $16,871,246 Federal Realty Investment Trust... Business/Retail Center... 8,446,179 Solo Cup Company... Business... 5,630,284 Klairmont Family Associates... Business/Retail Center... 5,475,193 Sunset Food Mart, Inc.... Retail Store... 5,301,625 Highland Park Associates II LLC... Business... 4,859,481 Americana Apartments... Real Property... 4,686,918 Individual Name Withheld... Real Property... 3,777,312 First Highland, LLC... Real Property... 3,606,368 Target Corporation... Retail Store... 3,499,650 Total... $62,154,256 Percent of Highland Park 2008 EAV ($2,780,479,845) % Notes: (1) Source: the City s December 31, 2008 Comprehensive Annual Financial Report. (2) Every effort has been made to seek out and report the largest taxpayers. However, many of the taxpayers listed contain multiple parcels and it is possible that some parcels and their valuations have been overlooked. The 2008 EAV is the most current available. 16

22 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A REAL PROPERTY ASSESSMENT, TAX LEVY AND COLLECTION PROCEDURES Tax Levy and Collection Procedures Local Assessment Officers determine the assessed valuation of taxable real property and railroad property not held or used for railroad operations. The Illinois Department of Revenue (the Department ) assesses certain other types of taxable property, including railroad property held or used for railroad operations. Local Assessment Officers valuation determinations are subject to review at the county level and then, in general, to equalization by the Department. Such equalization is achieved by applying to each county s assessments a multiplier determined by the Department. The purpose of equalization is to provide a common basis of assessments among counties by adjusting assessments toward the statutory standard of 33-1/3% of fair cash value. Farmland is assessed according to a statutory formula which takes into account factors such as productivity and crop mix. Taxes are extended against the assessed values after equalization. Property tax levies of each taxing body are filed in the office of the county clerk of each county in which territory of that taxing body is located. The county clerk computes the rates and amount of taxes applicable to taxable property subject to the tax levies of each taxing body and determines the dollar amount of taxes attributable to each respective parcel of taxable property. The county clerk then supplies to the appropriate collecting officials within the county the information needed to bill the taxes attributable to the various parcels therein. After the taxes have been collected, the collecting officials distribute to the various taxing bodies their respective shares of the taxes collected. Taxes levied in one calendar year are due and payable in two installments during the next calendar year. Taxes that are not paid when due, or that are not paid by mail and postmarked on or before the due date, are subject to a penalty of 1-1/2% per month until paid. Unpaid property taxes, together with penalties, interest and costs, constitute a lien against the property subject to the tax. Exemptions An annual General Homestead Exemption provides that the EAV of certain Residential Property may be reduced by the amount of any increase over the 1977 EAV, up to a maximum reduction of $3,500 for assessment years prior to assessment year 2004 in counties with less than 3,000,000 inhabitants, and a maximum reduction of $5,000 for assessment year 2004 through 2007 in all counties. Additionally, the maximum reduction is $5,500 for assessment year 2008 and the maximum reduction is $6,000 for assessment year 2009 and thereafter in all counties. The Homestead Improvement Exemption applies to Residential Properties that have been improved or rebuilt in the 2 years following a catastrophic event. The exemption is limited to $45,000 through December 31, 2003, and $75,000 per year beginning January 1, 2004 and thereafter, to the extent the assessed value is attributable solely to such improvements or rebuilding. Additional exemptions exist for senior citizens. The Senior Citizens Homestead Exemption operates annually to reduce the EAV on a senior citizen s home for assessment years prior to 2004 by $2,000 in counties with less than 3,000,000 inhabitants. For assessment years 2004 and 2005, the maximum reduction is $3,000 in all counties. For assessment years 2006 and 2007, the maximum reduction is $3,500 in all counties. In addition, for assessment year 2008 and thereafter, the maximum reduction is $4,000 for all counties. Furthermore, beginning with assessment year 2003, for taxes payable in 2004, property that is first occupied as a residence after January 1 of any assessment year by a person who is eligible for the Senior Citizens Homestead Exemption must be granted a pro rata exemption for the assessment year based on the number of days during the assessment year that the property is occupied as a residence by a person eligible for the exemption. 17

23 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A A Senior Citizens Assessment Freeze Homestead Exemption freezes property tax assessments for homeowners, who are 65 and older and receive a household income not in excess of the maximum income limitation. The maximum income limitation is $35,000 for years prior to 1999, $40,000 for assessment years 1999 through 2003, $45,000 for assessment years 2004 and 2005, $50,000 from assessment years 2006 and 2007 and for assessments year 2008 and after, the maximum income limitation is $55,000. In general, the Exemption limits the annual real property tax bill of such property by granting to qualifying senior citizens an exemption as to a portion of the valuation of their property. In counties with a population of 3,000,000 or more, the exemption for all assessment years is equal to the EAV of the residence in the assessment year for which application is made less the base amount. Furthermore, for those counties with less than 3,000,000, the exemption is as follows: through assessment year 2005 and for assessment year 2007 and later, the exempt amount is the difference between (i) the current EAV of their residence and (ii) the base amount, which is the EAV of a senior citizen s residence for the year prior to the year in which he or she first qualifies and applies for the Exemption (plus the EAV of improvements since such year). For assessment year 2006, the amount of the exemption phases out as the amount of household income increases. The amount of the exemption is calculated by using the same formula as above, and then multiplying the resulting value by a ratio that varies according to household income. Another exemption available to disabled veterans operates annually to exempt up to $70,000 of the Assessed Valuation of property owned and used exclusively by such veterans or their spouses for residential purposes. Also, certain property is exempt from taxation on the basis of ownership and/or use, such as public parks, not-for-profit schools and public schools, churches, and not-for-profit hospitals and public hospitals. However, individuals claiming exemption under the Disabled Persons Homestead Exemption or the Disabled Veterans Standard Homestead Exemption cannot claim the aforementioned exemption. Furthermore, beginning with assessment year 2007, the Disabled Persons Homestead Exemption provides an annual homestead exemption in the amount of $2,000 for property that is owned and occupied by certain persons with a disability. However, individuals claiming exemption as a disabled veteran or claiming exemption under the Disabled Veterans Standard Homestead Exemption cannot claim the aforementioned exemption. In addition, the Disabled Veterans Standard Homestead Exemption provides disabled veterans an annual homestead exemption starting with assessment year 2007 and thereafter. Specifically, (i) those veterans with a serviceconnected disability of 75% are granted an exemption of $5,000 and (ii) those veterans with a service-connected disability of less than 75%, but at least 50% are granted an exemption of $2,500. Furthermore, the veteran s surviving spouse is entitled to the benefit of the exemption, provided that the spouse has legal or beneficial title of the homestead, resides permanently on the homestead and does not remarry. Moreover, if the property is sold by the surviving spouse, then an exemption amount not to exceed the amount specified by the current property tax roll may be transferred to the spouse s new residence, provided that it is the spouse s primary residence and the spouse does not remarry. However, individuals claiming exemption as a disabled veteran or claiming exemption under the Disabled Persons Homestead Exemption cannot claim the aforementioned exemption. Beginning with assessment year 2007, the Returning Veterans Homestead Exemption is available for property owned and occupied as the principal residence of a veteran in the assessment year the veteran returns from an armed conflict while on active duty in the United States armed forces. This provision grants a homestead exemption of $5,000, which is applicable in all counties. In order to apply for this exemption, the individual must pay real estate taxes on the property, own the property or have either a legal or an equitable interest in the property, or a leasehold interest of land on which a single family residence is located, which is occupied as a principle residence of a veteran returning from an armed conflict involving the armed forces of the United States who has an ownership interest therein, legal, equitable or as a lessee, and on which the veteran is liable for the payment of property taxes. Those individuals eligible for this exemption may claim the exemption in addition to other homestead exemptions, unless otherwise noted. 18

24 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Property Tax Extension Limitation Law The Limitation Law limits the amount of the annual increase in property taxes to be extended for certain Illinois non-home rule units of government. In general, the Limitation Law restricts the amount of such increases to the lesser of 5% or the percentage increase in the Consumer Price Index during the calendar year preceding the levy year. Currently, the Limitation Law applies only to and is a limitation upon all non-home rule taxing bodies in Cook County, the five collar counties (DuPage, Kane, Lake, McHenry and Will) and several downstate counties. Home rule units, including the City, are exempt from the limitations contained in the Limitation Law. If the Limitation Law were to apply in the future to the City, the limitations set forth therein will not apply to any taxes levied by the City to pay the principal of and interest on the Bonds. Truth in Taxation Law The Law limits the aggregate amount of certain taxes which can be levied by, and extended for, a taxing district to 105% of the amount of taxes extended in the preceding year unless specified notice, hearing and certification requirements are met by the taxing body. The express purpose of the Law is to require published disclosure of, and hearing upon, an intention to adopt a levy in excess of the specified levels. FINANCIAL INFORMATION The City s financial statements are audited annually by certified public accountants. The City s financial statements are completed on a modified accrual basis of accounting for all governmental fund types and agency funds and are completed on the accrual basis of accounting for the proprietary fund types and pension trust funds consistent with generally accepted accounting principles applicable to governmental entities. See APPENDIX A for more detail. For the 25 th consecutive year, the Government Finance Officers Association (the GFOA ) awarded a certificate of achievement for Excellence in Financial Reporting to the City for its Comprehensive Annual Financial Report for the fiscal year ended December 31, Based on 2008 figures, the major General Fund revenues are sales taxes (30.3%), property taxes (9.6%), utility taxes (8%), real estate transfer tax (2.9%), State income taxes (7.0%), Franchise tax (5.1%) and license and permits (3.3%). The City s utility tax is 5%, though as a home rule municipality such tax could be increased above that level. Effective July 1, 2005, the City implemented a 1% food and beverage tax, a 1% package liquor tax, and a $0.01 per gallon motor fuel tax, utilizing its home-rule authority. The City has other home-rule revenue sources, such as a real estate transfer tax and hotel-motel tax. The motor fuel tax rate was increased to $0.02 per gallon effective January 1, The City has a fund balance policy whereby the balance is to equal to 25%-33% of expenditures. 19

25 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Investment Policy Objectives: The City s investment policy applies to general fund investments and investment of proprietary funds. A. Preservation of capital is the most important objective of this policy. To accomplish this objective, the portfolio will be sufficiently diversified with respect to the types of securities held, the number of financial institutions utilized, and the maturities of the individual securities. B. Liquidity is the next priority. In order to avoid the need for short-term borrowing, investment maturities shall be planned to match expected operating expenditures. In no event shall maturities exceed three years. C. Maximizing the rate of return shall be the next priority. The investment portfolio shall be structured to attain a market-average rate of return throughout economic and budgetary cycles. The performance benchmark shall be the average return on a three-month treasury bill. D. Maintaining the public s trust shall be an important objective of this policy. All participants in the investment process shall act responsibly as custodians of the public trust and shall avoid any transaction that might impair public confidence in the City. It is the policy of the City to concentrate its investment efforts in, but not be limited to, U.S. Treasury Obligations, Certificates of Deposit, the Illinois Funds, and the Illinois Metropolitan Investment Fund. Security: It is the policy of the City to require security for all cash maintained in any financial institution designated as a depository. Security may be in the form of insurance or collateral. No Consent or Updated Information Requested of the Auditor The tables and excerpts (collectively, the Excerpted Financial Information ) contained in this FINANCIAL INFORMATION section and in APPENDIX A are from the audited financial statements of the City, including the audited financial statements for the fiscal year ended December 31, 2008 (the 2008 Audit ). The 2008 Audit has been prepared by Sikich LLP, Independent Certified Public Accountant, Aurora, Illinois (the Auditor ), and accepted by formal action of the City Council. The City has not requested the Auditor to update information contained in the Excerpted Financial Information; nor has the City requested that the Auditor consent to the use of the Excerpted Financial Information in this Official Statement. Other than as expressly set forth in this Official Statement, the financial information contained in the Excerpted Financial Information has not been updated since the date of the 2008 Audit. The inclusion of the Excerpted Financial Information in this Official Statement in and of itself is not intended to demonstrate the fiscal condition of the City since the date of the 2008 Audit. Questions or inquiries relating to financial information of the City since the date of the 2008 Audit should be directed to the City. Summary Financial Information The following tables are summaries and do not purport to be the complete audits, copies of which are available upon request. See APPENDIX A for excerpts of the City s 2008 fiscal year audit. 20

26 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Statement of Net Assets Governmental Activities Audited Audited Eight Months Twelve Month Ended Ended Audited As Of April 30: December 31, December 31, ASSETS: Cash... $ 11,012,460 $ 15,332,867 $ 13,492,329 $ 12,896,518 $ 18,738,259 $ 22,238,794 Investments... 6,326,204 20,468,628 20,348,149 23,214,172 22,473,190 25,217,123 Receivables: Property Taxes... 9,044,791 10,191,602 9,400,294 9,985,360 10,578,594 10,870,148 Motor Fuel Tax Allotments , ,101 69, , , ,933 Intergovernmental... 3,513,549 3,707,249 4,367,475 4,657,466 4,567,372 4,158,358 Loans , , , , , ,000 Accrued Interest ,640 10,001 64,800 64,200 Accounts , ,317 1,210, ,139 2,245,196 1,839,440 Prepaid Expenses... 43,436 43,436 43, ,171 Inventory Due To/ From Other Funds... 2,151,444 (1,827,642) 4,620, ,000 1,100, ,000 Due From Fiduciary Funds... 27,917 0 (663,125) Due From Component Unit ,142 1,899 1, Deferred Charges ,211 55,635 70,804 64,084 Land Held For Resale ,160,000 1,160, Net Pension Asset ,941,318 3,058,639 3,187,251 3,329,308 3,428,397 Capital Assets Not Being Depreciated... 9,400,699 10,706,083 15,404,000 19,104,761 8,744,366 8,923,202 Capital Assets Being Depreciated, Net of Accumulated Depreciation... 50,124, ,831, ,499, ,287, ,746, ,206,731 Total Assets... $ 92,714,825 $170,784,751 $178,486,919 $180,474,931 $188,166,328 $190,422,581 LIABILITIES: Accounts Payable... $ 2,609,392 $ 1,396,555 $ 2,129,323 $ 1,965,156 $ 1,724,878 $ 2,585,805 Accrued Payroll , , , , , ,831 Claims Payable , , , , ,786 0 Accrued Interest Payable , , , ,754 69,973 65,842 Due to Fiduciary Funds , Unearned Revenue... 9,037,631 10,250,553 9,434,461 10,046,830 10,685,334 10,972,528 Refundable Deposits... 20,547 99, ,686 46,705 53,990 56,315 Noncurrent Liabilities: Due Within One Year... 2,999,396 3,984,307 3,867,728 4,197,845 4,276,723 2,974,988 Due In More Than One Year... 25,322,248 38,913,156 46,128,476 43,151,144 43,338,995 42,483,908 Total Liabilities... $ 40,838,613 $ 55,716,190 $ 63,611,087 $ 61,035,609 $ 61,392,510 $ 59,997,217 NET ASSETS: Investment in Capital Assets, Net of Related Debt... $ 34,615,233 $ 94,907,427 $ 90,605,742 $ 93,387,691 $ 96,339,097 $ 96,490,406 Restricted For: Debt Service , , ,088 1,087,297 1,212,062 1,279,425 Public Facilities ,454 5,390,621 6,231,545 2,082, ,373 53,602 Working Cash , Public Safety... 1,061,309 1,333,460 1,351,981 1,273,347 1,054, ,001 Employee Retirement Highways and Streets... 65, ,849 3,335,982 6,017,524 6,427,340 4,984,182 Culture and Recreation Net Pension Obligation ,941, Unrestricted... 14,711,532 9,454,256 12,850,494 15,590,474 21,208,977 26,827,748 Total Net Assets... $ 51,876,212 $115,068,561 $114,875,832 $119,439,322 $126,773,818 $130,425,364 21

27 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Statement of Activities Governmental Activities Net (Expense) Revenue and Charges in Net Assets Audited Audited Eight Months Twelve Month Ended Ended Audited Fiscal Year Ended April 30: December 31, December 31, PRIMARY GOVERNMENT:(1) Governmental Activities: General Government... $ (5,900,716) $ (6,759,348) $ (8,439,569) $ (3,688,061) $ (2,050,389) $ (4,288,444) Public Safety... (16,950,189) (15,024,259) (16,167,850) (15,627,565) (12,404,902) (18,132,211) Public Works... (4,628,998) (7,322,214) (6,776,111) (8,760,544) (5,938,239) (11,580,315) Economic and Physical Development... (3,530,573) (2,427,059) (3,221,668) (2,503,318) (1,987,194) (1,524,292) Transit... (227,336) (268,505) (158,501) (144,216) (189,283) (248,479) Commissions... (1,450,664) (631,526) (1,042,067) (650,680) (354,650) (419,811) Interest... (676,833) (858,741) (1,629,285) (1,874,859) (1,161,404) (1,764,586) Total governmental activities... $(33,365,309) $(33,291,652) $(37,435,051) $(33,249,243) $(24,086,061) $(37,958,138) GENERAL REVENUES: Taxes: Property... $ 9,887,448 $ 10,001,506 $ 10,207,239 $ 9,376,023 $ 9,952,745 $ 10,628,574 Replacement , , , , , ,105 Home Rule Sales... 4,266,487 4,316,071 4,546,735 4,734,058 3,385,307 4,504,122 Sales... 7,772,040 7,775,957 8,243,516 8,600,985 6,012,021 7,947,082 Utility... 3,469,014 2,785,652 3,114,634 3,120,499 1,684,513 3,106,464 Franchise ,675 2,072,215 2,215,223 2,491,923 1,789,494 2,612,081 Real Estate Transfer... 2,174,270 2,420,485 2,919,960 2,809,795 1,267,630 1,202,395 Income... 1,823,033 2,048,727 2,312,384 2,550,586 1,787,461 2,864,722 Other , ,446 1,189,256 1,777,312 1,231,944 1,828,875 Investment income , , ,346 1,911,975 2,609,554 1,153,313 Miscellaneous(3) ,316,951 Gain (loss) on sale of capital assets.. 838, Transfers , , , , , ,000 Special Item ,079, ,306,489 0 Total... $ 32,830,640 $ 37,164,478 $ 37,008,113 $ 37,812,733 $ 31,377,937 $ 41,609,684 CHANGE IN NET ASSETS... (534,669) 3,872,826 (426,938) 4,563,490 7,291,876 3,651,546 NET ASSETS, MAY 1... $ 52,410,881 $ 51,394,080(2) $115,068,561 $114,875,832 $119,439,322 $126,773,818 Prior period adjustment... $ 0 $ 59,801,655 $ 234, ,620 0 NET ASSETS, MAY 1, RESTATED... 52,410, ,195,735(2) 115,302,770(2) 114,875, ,481, ,773,818 NET ASSETS, APRIL $ 51,876,212 $115,068,561 $114,875,832 $119,439,322 $126,773,818 $130,425,364 Notes: (1) Expenses less Program Revenues of Charges for Services, Operating Grants, and Capital Grants. (2) As restated. (3) Net appreciation in fair value of investments. 22

28 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A General Fund Balance Sheet Audited Audited Eight Months Twelve Month Ended Ended Audited As Of April 30: December 31, December 31, ASSETS: Cash... $ 3,112,230 $10,268,711 $11,019,972 $ 8,958,918 $12,622,251 $16,012,448 Investments... 3,438,134 18,676,415 18,550,583 18,414,496 17,128,260 22,309,500 Land Held For Resale ,160,000 1,160, Receivables: Property Taxes... 2,995,259 3,079,548 3,373,913 3,621,660 3,921,660 4,108,220 Intergovernmental... 3,513,549 3,707,249 4,367,475 4,452,017 4,567,372 4,012,407 Other Accrued Interest ,108 5,425 64,800 64,200 Accounts , , ,510 1,730,860 1,469,499 Due From Other Funds... 3,703, , ,100, ,000 Due From Component Unit , Due from Fiduciary Funds... 27, , Prepaid Items... 43,436 43,436 43, Other Assets Total Assets... $17,027,349 $36,940,851 $38,726,525 $35,773,026 $41,135,203 $48,426,274 LIABILITIES AND FUND BALANCE: Liabilities: Accounts Payable... $ 1,010,135 $ 731,413 $ 741,454 $ 844,815 $ 1,135,917 $ 1,662,062 Accrued Payroll , , , , , ,705 Due to Other Funds... 1,020,946 3,620,991 4,632, Due to Fiduciary Funds , Deferred Revenues... 2,995,249 3,138,499 3,408,080 3,658,130 5,304,466 5,234,905 Accrued Insurance Claims Notes Payable ,160,000 1,160, Refundable Deposits... 20,547 99, ,686 46,705 53,990 56,315 Total Liabilities... $ 5,232,717 $ 8,958,695 $10,262,138 $ 4,780,734 $ 6,944,760 $ 7,630,987 Fund Balances: Reserved for Land Held for Resale... $ 0 $ 1,160,000 $ 0 $ 0 $ 0 $ 0 Reserved for Prepaid Items... 43,436 43,436 43, Reserved for Employee Retirement ,590,000 16,475,000 16,340,000 17,128,260 22,309,500 Designated Other Post-Employment Benefits ,175,495 2,375,495 3,575,495 Unreserved - Undesignated... 11,751,196 10,188,720 11,945,951 13,476,797 14,686,688 14,910,292 Total Fund Balance... $11,794,632 $27,982,156 $28,464,387 $30,992,292 $34,190,443 $40,795,287 Total Liabilities & Fund Balance... $17,027,349 $36,940,851 $38,726,525 $35,773,026 $41,135,203 $48,426,274 23

29 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A General Fund Statement of Revenues, Expenditures and Changes in Fund Balances Audited Audited Eight Months Twelve Month Ended Ended Audited Fiscal Year Ended April 30: December 31, December 31, REVENUES: Property Taxes... $ 2,772,222 $ 2,929,472 $ 3,047,254 $ 3,376,321 $ 3,620,275 $ 3,943,447 Illinois State Replacement Taxes , , , , , ,105 Licenses and Permits... 2,382,918 1,916,083 1,943,324 1,912,338 1,193,732 1,334,758 Municipal Sales Tax... 12,038,527 12,092,027 12,790,251 13,335,043 9,397,327 12,451,204 Illinois State Income Tax... 1,823,033 2,048,727 2,312,384 2,550,586 1,787,461 2,864,722 Utility Tax... 3,469,014 2,785,652 3,114,634 3,120,499 1,684,513 3,106,464 Real Estate Transfer Tax... 2,174,270 2,420,485 2,919,960 2,809,795 1,267,630 1,202,395 Charges for Current Services... 1,167,875 1,042,650 1,289,867 1,382,218 1,013,803 1,607,216 Regional Transportation Authority Reimbursement , ,361 1,069,354 1,055, ,569 1,077,078 Investment Income , , ,049 1,529,552 2,371,906 1,037,028 Net Appreciation in Fair Value of Investments ,475,734 Fines and Forfeiture , , , , , ,803 Cable Television Franchise Tax , , , , , ,939 Intergovernmental , , ,112 23,613 73, ,237 Other Taxes ,140 2, ,110 1,222, ,627 1,435,960 Fire Insurance Tax Franchise Tax ,542 1,703,043 1,807,586 2,040,791 1,457,558 2,088,142 Reimbursement Fort Sheridan Expenditures , , , Reimbursements - Other Agencies ,089, , ,586 Miscellaneous , , , , ,158 1,627,555 Total Revenues... $29,977,209 $30,005,355 $33,652,274 $36,840,825 $27,177,867 $40,978,373 EXPENDITURES: General Government... $ 6,308,791 $ 7,027,043 $ 7,591,557 $ 5,625,763 $ 3,087,130 $ 5,456,559 Public Safety... 14,763,886 15,429,305 16,720,541 17,336,575 13,313,048 18,599,802 Public Works... 1,657,957 1,669,828 1,737,663 1,936,638 1,309,440 1,904,724 Economic and Physical Development ,467,023 3,862,701 3,786,103 2,538,460 3,885,286 Employee Retirement Benefits Transit ,212,533 1,185,939 1,210, ,584 1,340,683 Commissions , , , , ,815 Other... 4,740, Total Expenditures... $27,471,045 $29,086,104 $31,361,589 $30,297,908 $21,401,166 $31,366,869 Excess (Deficiency) of Revenues Over Expenditures... $ 2,506,164 $ 919,251 $ 2,290,685 $ 6,542,917 $ 5,776,701 $ 9,611,504 Other Financing Sources (Uses) Bond Proceeds... $ 0 $16,590,000 $ 0 $ 0 $ 0 $ 0 Proceeds from the sale of capital assets... 3,876, ,061 8, , Operating Transfers In , , , Operating Transfers Out... (3,650,000) (2,700,000) (2,703,954) (4,470,800) (2,578,550) (3,006,660) Total Operating Transfers... $ 1,167,670 $15,086,007 $(1,808,454) $(4,015,012) $(2,578,550) $(3,006,660) Excess (Deficiency) of Revenues and Other Financing Sources Over Expenditures and Other Financing Uses. $ 3,673,834 $16,005,258 $ 482,231 $ 2,527,905 $ 3,198,151 $ 6,604,844 Beginning Fund Balance... $ 8,638,274 $11,794,632 $27,982,156 $28,464,387 $30,992,292 $34,190,443 Prior period Adjustment... (517,476) 182,296(1) Residual Equity Transfers, Net Ending Fund Balance... $11,794,632 $27,982,186 $28,464,387 $30,992,292 $34,190,443 $40,795,287 Note: (1) Prior period adjustment to correct utility tax accrual in prior year and to reclassify funds held on deposit. 24

30 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A General Fund Budget and Interim Unaudited Preliminary 2009 Budget Budget REVENUES: Beginning Cash Reserves... $12,604,837 $14,910,292 12,945,195 Property Taxes... 4,126,644 4,087,570 4,422,522 Sales Tax... 12,892,111 11,602,900 11,602,900 Utility Tax... 4,993,045 4,769,201 4,875,000 State Income Tax... 2,859,759 2,872,000 2,846,859 Real Estate Transfer Tax... 1,300, , ,000 Other Taxes... 2,382,194 2,405,786 2,336,570 Building Revenue/Government... 1,302, , ,000 Licenses , , ,075 Fines/Forfeits , , ,954 Interest/Rental Income , , ,824 Charges... 2,327,706 2,487,920 2,549,714 Miscellaneous... 2,022,790 2,345,247 2,213,560 Total Revenues... $47,915,251 $47,966,898 $46,400,173 EXPENDITURES: City Manager's Office... $ 2,714,228 $ 2,499,636 $ 2,656,277 Fiscal and Administrative Services... 8,252,012 7,718,614 7,120,689 Legal ,081 1,006, ,391 Youth/Seniors , , ,083 Commissions , , ,607 Police... 9,485,900 9,213,192 9,277,422 Fire... 6,914,610 6,906,389 6,678,339 Building Inspection... 1,792,274 1,621,864 1,472,014 Community Development... 1,289,911 1,136,157 1,202,306 Public Works/Engineering... 1,785,760 1,544,354 1,498,137 Transit... 1,209,043 1,214,848 1,206,927 Building Maintenance , ,053 1,055,480 Non-Departmental Total Expenditures... $36,756,827 $35,021,703 $34,253,672 Revenues and Reserves over (under) Expenditures... $11,158,424 $12,945,195 $12,146,501 Note: (1) Budget for 2009 represents the original adopted budget for the 12 months ended December 31, See APPENDIX A herein. PENSION AND RETIREMENT OBLIGATIONS REGISTRATION, TRANSFER AND EXCHANGE See also APPENDIX B for information on registration, transfer and exchange of book-entry bonds. The Bonds will be initially issued as book-entry bonds. The City shall cause books (the Bond Register ) for the registration and for the transfer of the Bonds to be kept at the principal corporate trust office of the Bond Registrar in Chicago, Illinois. The City will authorize to be prepared, and the Bond Registrar shall keep custody of, multiple bond blanks executed by the City for use in the transfer and exchange of Bonds. Any Bond may be transferred or exchanged, but only in the manner, subject to the limitations, and upon payment of the charges as set forth in the Ordinance. Upon surrender for transfer or exchange of any Bond at the principal office maintained for the purpose by the Bond Registrar, duly endorsed by, or accompanied by a written instrument or instruments of transfer in form satisfactory to the Bond Registrar and duly executed by the registered owner or such owner s attorney duly authorized in writing, the City shall execute and the Bond Registrar shall authenticate, date and deliver in the name of the registered owner, transferee or transferees (as the case may be) a new fully registered Bond or Bonds of the same maturity and interest rate of authorized denominations, for a like aggregate principal amount. 25

31 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A The execution by the City of any fully registered Bond shall constitute full and due authorization of such Bond, and the Bond Registrar shall thereby be authorized to authenticate, date and deliver such Bond, provided, however, the principal amount of outstanding Bonds of each maturity authenticated by the Bond Registrar shall not exceed the authorized principal amount of Bonds for such maturity less Bonds previously paid. The Bond Registrar shall not be required to transfer or exchange any Bond following the close of business on the 15 th day of the month in which an interest payment date occurs on such Bond (known as the record date), or during the period of 15 days preceding the giving of notice of redemption of Bonds or to transfer or exchange any Bond all or a portion of which has been called for redemption. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of the principal of or interest on any Bonds shall be made only to or upon the order of the registered owner thereof or such owner s legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid. No service charge shall be made for any transfer or exchange of Bonds, but the City or the Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any transfer or exchange of Bonds, except in the case of the issuance of a Bond or Bonds for the unredeemed portion of a Bond surrendered for redemption. Taxable Bonds TAX TREATMENT Interest on the Bonds is includible in gross income for federal income purposes. Ownership of the Bonds may result in other federal income tax consequences to certain taxpayers. Bondholders should consult their tax advisors with respect to the inclusion of interest on the Bonds in gross income for federal income tax purposes and any collateral tax consequences. Interest on the Bonds is not exempt from present State of Illinois income taxes. Ownership of the Bonds may result in other state and local tax consequences to certain taxpayers, and Bond Counsel expresses no opinion regarding any such consequences arising with respect to the Bonds. Recovery Zone Economic Development Bonds As part of the American Recovery and Reinvestment Act of 2009 (the Recovery Act ), Congress added provisions to the Internal Revenue Code of 1986, as amended (the Code ), that permit state or local governments to obtain certain tax advantages when issuing certain taxable obligations, referred to as Build America Bonds. A Build America Bond must satisfy certain requirements, including that the interest on the Build America Bonds would be, but for the issuer s election to treat such bonds as Build America Bonds, excludable from gross income under Section 103 of the Code. The City intends to make or has made an irrevocable election to treat the Bonds as Build America Bonds. A separate Code provision added by the Recovery Act allows certain Build America Bonds to be treated as Recovery Zone Economic Development Bonds. The City also intends to or has designated the Bonds as Recovery Zone Economic Development Bonds. As a result of this election and designation, interest on the Bonds will be includible in gross income of the holders thereof for federal income tax purposes and the holders of the Bonds will not be entitled to any tax credits as a result either of ownership of the Bonds or of receipt of any interest payments on the Bonds. Bondholders should consult their tax advisors with respect to the inclusion of interest on the Bonds in gross income for federal income tax purposes. Federal tax law contains a number of requirements and restrictions that apply to the Bonds in order for them to be Recovery Zone Economic Development Bonds, including investment restrictions, periodic payments of arbitrage profits to the United States, requirements regarding the proper use of bond proceeds and the facilities financed therewith, and certain other matters. The City has covenanted to comply with all requirements that must be satisfied in order for the Bonds to be Recovery Zone Economic Development Bonds. Failure to comply with certain of such covenants could cause the Bonds to not be Recovery Zone Economic Development Bonds (and consequently could prevent the allowance of Recovery Zone Payments described below) retroactively to the date of issuance of the Bonds. 26

32 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A As a consequence of the Bonds being Recovery Zone Economic Development Bonds under Section 1400U-2 of the Code, the City will be entitled to apply for certain tax credits under Section 6431 of the Code (the Recovery Zone Payments ). If for any reason the Bonds cease to be Recovery Zone Economic Development Bonds under Section 1400U-2 of the Code, the City will not be entitled to receive such Recovery Zone Payments. Recovery Zone Economic Development Bonds may only be issued pursuant to a volume cap allocation and in an amount not to exceed such allocation. The City has been allocated a portion of the volume cap allocation of Lake County, Illinois, in the amount of $3,000,000. Generally, Recovery Zone Economic Development Bonds must be used for qualified economic development purposes within a recovery zone ( Recovery Zone ). A Recovery Zone is (i) any area designated by the City as having significant poverty, unemployment, rate of home foreclosures, or general distress; (ii) any area designated by the City as economically distressed by reason of the closure or realignment of a military installation pursuant to the Defense Base Closure and Realignment Act of 1990; and (iii) any area for which a designation as an empowerment zone or renewal community is in effect as of the effective date of the Recovery Act. The City intends to designate before the issuance of the Bonds the City as a Recovery Zone. The City is within the boundaries of the County. In making such designation, the City has found that this Recovery Zone has significant poverty, unemployment, rate of home foreclosures, or general distress. The amount of each Recovery Zone Development Payment is set in Section 1400U-2 of the Code at 45 percent of the corresponding interest payable on the related Recovery Zone Economic Development Bond. If received by the City, the Recovery Zone Payments will be revenues of the City and are pledged to the payment of the Bonds. To receive a Recovery Zone Payment, under currently existing procedures, an issuer of Recovery Zone Economic Development Bonds will have to file a tax return between 90 and 45 days prior to each interest payment date. The procedures provide that an issuer should expect to receive the Recovery Zone Payment within 45 days of filing the return. Depending on the timing of the filing, the Recovery Zone Payment may be received before or after the corresponding interest payment. No assurances are provided that the City will receive Recovery Zone Payments. The amount of any Recovery Zone Payment is subject to legislative changes by Congress. Also, Recovery Zone Payments are subject to offset against certain amounts that may, for unrelated reasons, be owed by the City to an agency of the United States of America. Circular 230 This Official Statement contains tax advice written to market the Bonds. This subsection is informing Bondholders of the following as required under Treas. Reg which is contained in the rules of practice before the Internal Revenue Service, commonly known as Circular 230. The tax advice contained in this Official Statement is not intended or written by the City, 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. The City and its Bond Counsel impose no restrictions or limitations on disclosing the content of this Official Statement or of any details of the structure of the Bonds or on the tax treatment or tax structure of the Bonds and the use of proceeds thereof. 27

33 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A CONTINUING DISCLOSURE The City will enter into a Continuing Disclosure Undertaking (the Undertaking ) for the benefit of the beneficial owners of the Bonds to send certain information annually and to provide notice of certain events to the Municipal Securities Rulemaking Board (the MSRB ) pursuant to the requirements of Section (b)(5) of Rule 15c2-12 (the Rule ) adopted by the Securities and Exchange Commission (the Commission ) under the Securities Exchange Act of The information to be provided on an annual basis, the events which will be noticed on an occurrence basis and a summary of other terms of the Undertaking, including termination, amendment and remedies, are set forth below under THE UNDERTAKING. The City has represented that it has not failed to comply in all material respects with each and every undertaking previously entered into by it pursuant to the Rule. A failure by the City to comply with the Undertaking will not constitute a default under the Ordinance and beneficial owners of the Bonds are limited to the remedies described in the Undertaking. See THE UNDERTAKING - Consequences of Failure of the City to Provide Information. A failure by the City to comply with the Undertaking must be reported in accordance with the Rule and must be considered by any broker, dealer or municipal securities dealer before recommending the purchase or sale of the Bonds in the secondary market. Consequently, such a failure may adversely affect the transferability and liquidity of the Bonds and their market price. Bond Counsel expresses no opinion as to whether the Undertaking complies with the requirements of Section (b)(5) of the Rule. THE UNDERTAKING The following is a brief summary of certain provisions of the Undertaking of the City and does not purport to be complete. The statements made under this caption are subject to the detailed provisions of the Undertaking, a copy of which is available upon request from the City. Annual Financial Information Disclosure The City covenants that it will disseminate its Annual Financial Information and its Audited Financial Statements, if any (as described below) to the MSRB in such manner and format and accompanied by identifying information as is prescribed by the MSRB or the Commission at the time of delivery of such information. The City is required to deliver such information so that such entities receive the information by the dates specified in the Undertaking. Annual Financial Information means 1. The table under the heading of Retailers Occupation, Service Occupation and Use Tax within this Official Statement; 2. All of the tables under the heading PROPERTY ASSESSMENT AND TAX INFORMATION within this Official Statement; 3. All of the tables under the heading DEBT INFORMATION within this Official Statement; and 4. All of the tables under the heading FINANCIAL INFORMATION within this Official Statement. 28

34 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Material Events Disclosure The City covenants that it will disseminate in a timely manner to the MSRB the disclosure of the occurrence of an Event (as described below) with respect to the Bonds that is material, as materiality is interpreted under the Securities Exchange Act of 1934, as amended, in such manner and format and accompanied by identifying information as is prescribed by the MSRB or the Commission at the time of delivery of such information. The Events are: Principal and interest payment delinquencies Non-payment related defaults Unscheduled draws on debt service reserves reflecting financial difficulties Unscheduled draws on credit enhancements reflecting financial difficulties Substitution of credit or liquidity providers, or their failure to perform Adverse tax opinions or events affecting the tax-exempt status of the security Modifications to the rights of security holders Bond calls Defeasances Release, substitution or sale of property securing repayment of the securities Rating changes Consequences of Failure of the City to Provide Information The City shall give notice in a timely manner to the MSRB of any failure to provide disclosure of Annual Financial Information and Audited Financial Statements when the same are due under the Undertaking. In the event of a failure of the City to comply with any provision of the Undertaking, the beneficial owner of any Bond may seek mandamus or specific performance by court order to cause the City to comply with its obligations under the Undertaking. A default under the Undertaking shall not be deemed a default under the Ordinance, and the sole remedy under the Undertaking in the event of any failure of the City to comply with the Undertaking shall be an action to compel performance. Amendment; Waiver Notwithstanding any other provision of the Undertaking, the City by resolution or ordinance authorizing such amendment or waiver, may amend the Undertaking, and any provision of the Undertaking may be waived, if: (a) (i) The amendment or the waiver is made in connection with a change in circumstances that arises from a change in legal requirements, including, without limitation, pursuant to a no-action letter issued by the Commission, a change in law, or a change in the identity, nature, or status of the City, or type of business conducted; or (ii) The Undertaking, as amended, or the provision, as waived, would have complied with the requirements of the Rule at the time of the primary offering, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (b) The amendment or waiver does not materially impair the interests of the beneficial owners of the Bonds, as determined by parties unaffiliated with the City (such as Bond Counsel). In the event that the Commission or the MSRB or other regulatory authority approves or requires Annual Financial Information or notices of a material Event to be filed with a central post office, governmental agency or similar entity other than the MSRB or in lieu of the MSRB, the City shall, if required, make such dissemination to such central post office, governmental agency or similar entity without the necessity of amending the Undertaking. 29

35 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A Termination of Undertaking The Undertaking shall be terminated if the City shall no longer have any legal liability for any obligation on or relating to repayment of the Bonds under the Ordinance. The City shall give notice to the MSRB in a timely manner if this paragraph is applicable. Additional Information Nothing in the Undertaking shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in the Undertaking or any other means of communication, or including any other information in any Annual Financial Information or Audited Financial Statements or notice of occurrence of a material Event, in addition to that which is required by the Undertaking. If the City chooses to include any information from any document or notice of occurrence of a material Event in addition to that which is specifically required by the Undertaking, the City shall have no obligation under the Undertaking to update such information or include it in any future disclosure or notice of occurrence of a material Event. Dissemination of Information; Dissemination Agent When filings are required to be made with the MSRB in accordance with the Undertaking, such filings are required to be made through its Electronic Municipal Market Access (EMMA) system for municipal securities disclosure or through any other electronic format or system prescribed by the MSRB for purposes of the Rule. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under the Undertaking, and may discharge any such Agent, with or without appointing a successor Dissemination Agent. OPTIONAL REDEMPTION The Bonds are callable in whole or in part on any date on or after December 30, 2019, at a price of par and accrued interest. If less than all the Bonds are called, they shall be redeemed in such principal amounts and from such maturities as determined by the City and within any maturity by lot. The Bond Registrar will give notice of redemption, identifying the Bonds (or portions thereof) to be redeemed, by mailing a copy of the redemption notice by first class mail not less than thirty (30) days nor more than sixty (60) days prior to the date fixed for redemption to the registered owner of each Bond (or portion thereof) to be redeemed at the address shown on the registration books maintained by the Bond Registrar. Unless moneys sufficient to pay the redemption price of the Bonds to be redeemed are received by the Bond Registrar prior to the giving of such notice of redemption, such notice may, at the option of the City, state that said redemption will be conditional upon the receipt of such moneys by the Bond Registrar on or prior to the date fixed for redemption. If such moneys are not received, such notice will be of no force and effect, the City will not redeem such Bonds, and the Bond Registrar will give notice, in the same manner in which the notice of redemption has been given, that such moneys were not so received and that such Bonds will not be redeemed. Otherwise, prior to any redemption date, the City will deposit with the Bond Registrar an amount of money sufficient to pay the redemption price of all the Bonds or portions of Bonds which are to be redeemed on the date. Subject to the provisions for a conditional redemption described above, notice of redemption having been given as described above and in the Bond Ordinance, the Bonds or portions of Bonds so to be redeemed will, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date (unless the City shall default in the payment of the redemption price) such Bonds or portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for redemption in accordance with said notice, such Bonds will be paid by the Bond Registrar at the redemption price. 30

36 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A LITIGATION There is no litigation of any nature now pending or threatened restraining or enjoining the issuance, sale, execution or delivery of the Bonds, or in any way contesting or affecting the validity of the Bonds or any proceedings of the City taken with respect to the issuance or sale thereof. OFFICIAL STATEMENT AUTHORIZATION This Official Statement has been authorized for distribution to prospective purchasers of the Bonds. All statements, information, and statistics herein are believed to be correct but are not guaranteed by the consultants or by the City, and all expressions of opinion, whether or not so stated, are intended only as such. INVESTMENT RATING The City has applied for an investment rating on the Bonds from Moody s Investors Service, New York, New York ( Moody s ). No application was made to any other rating agency for the purpose of obtaining an additional rating on the Bonds. Generally, rating agencies base their ratings on such information and materials and investigations, studies and assumptions by the respective rating agency. There is no assurance that such rating will continue for any given period of time or that it will not be revised downward or withdrawn entirely by such rating agency if, in its judgment, circumstances so warrant. Any such downward revision or withdrawal of such rating may have an adverse effect on the market price of the Bonds. The City and the Underwriters have undertaken no responsibility either to bring to the attention of the registered owners of the Bonds any proposed change in or withdrawal of such rating or to oppose any such revision or withdrawal (other than to comply with any applicable continuing disclosure requirements). An explanation of the significance of investment ratings may be obtained from the rating agency: Moody s Investors Service, 7 World Trade Center at 250 Greenwich Street, New York, New York 10007, telephone CERTAIN LEGAL MATTERS Certain legal matters incident to the authorization, issuance and sale of the Bonds are subject to the approving legal opinion of Chapman and Cutler LLP, Chicago, Illinois, as Bond Counsel (the Bond Counsel ), who has been retained by, and acts as, Bond Counsel to the City. Bond Counsel has not been retained or consulted on disclosure matters and has not undertaken to review or verify the accuracy, completeness or sufficiency of this Official Statement or other offering material relating to the Bonds and assumes no responsibility for the statements or information contained in or incorporated by reference in this Official Statement, except that in its capacity as Bond Counsel, Chapman and Cutler LLP has, at the request of the City, reviewed only those portions of this Official Statement involving the description of the Bonds, the security for the Bonds (excluding forecasts, projections, estimates or any other financial or economic information in connection therewith), the description of the federal tax status of interest on the Bonds and the Recovery Zone Economic Development Bond status of the Bonds. This review was undertaken solely at the request and for the benefit of the City and did not include any obligation to establish or confirm factual matters set forth herein. UNDERWRITING The Bonds were offered for sale by the City at a public, competitive sale on April 26, The best bid submitted at the sale was submitted by (the Underwriter ). The City awarded the contract for sale of the Bonds to the Underwriter at a price of $. The Underwriter has represented to the City that the Bonds have been subsequently re-offered to the public initially at the yields or prices set forth in the addendum to this Official Statement. 31

37 City of Highland Park, Lake County, Illinois $3,000,000* Taxable General Obligation Bonds, Series 2010A FINANCIAL ADVISOR The City has engaged Speer Financial, Inc. as financial advisor (the Financial Advisor ) in connection with the issuance and sale of the Bonds. The Financial Advisor will not participate in the underwriting of the Bonds. The financial information included in the Official Statement has been compiled by the Financial Advisor. Such information does not purport to be a review, audit or certified forecast of future events and may not conform with accounting principles applicable to compilations of financial information. The Financial Advisor is not a firm of certified public accountants and does not serve in that capacity or provide accounting services in connection with the Bonds. The Financial Advisor is not obligated to undertake any independent verification of or to assume any responsibility for the accuracy, completeness or fairness of the information contained in this Official Statement, nor is the Financial Advisor obligated by the City s continuing disclosure undertaking. CERTIFICATION We have examined this Official Statement dated April 13, 2010, for the $3,000,000* Taxable General Obligation Bonds, Series 2010A, believe it to be true and correct and will provide to the purchaser of the Bonds at the time of delivery a certificate confirming to the purchaser that to the best of our knowledge and belief information in the Official Statement was at the time of acceptance of the bid for the Bonds and, including any addenda thereto, was at the time of delivery of the Bonds true and correct in all material respects and does not include any untrue statement of a material fact, nor does it omit the statement of any material fact required to be stated therein, or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. /s/ MICHAEL D. BELSKY Mayor CITY OF HIGHLAND PARK Lake County, Illinois /s/ ELIZABETH HOLLEB Director of Finance CITY OF HIGHLAND PARK Lake County, Illinois 32

38 APPENDIX A CITY OF HIGHLAND PARK LAKE COUNTY, ILLINOIS EXCERPTS OF FISCAL YEAR 2008 AUDITED FINANCIAL STATEMENTS

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