$7,215,000* general obligation corporate purpose …€¦ · this preliminary official statement...
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PRELIMINARY OFFICIAL STATEMENT DATED FEBRUARY 13, 2018
In the opinion of Husch Blackwell LLP, Bond Counsel, assuming continued compliance with the requirements of the Internal Revenue Code of 1986, under existinglaw interest on the Bonds is excluded from gross income and is not an item of tax preference for federal income tax purposes. See "TAX EXEMPTION" herein fora more detailed discussion of some of the federal income tax consequences of owning the Bonds. The interest on the Bonds is not exempt from present Wisconsinincome or franchise taxes.
The City will designate the Bonds as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended, relatingto the ability of financial institutions to deduct from income for federal income tax purposes, interest expense that is allocable to carrying and acquiring tax-exemptobligations.
New Issue Rating Applications Made: Moody's Investors ServiceS&P Global Ratings
CITY OF CUDAHY, WISCONSIN(Milwaukee County)
$7,215,000* GENERAL OBLIGATION CORPORATE PURPOSE BONDS, SERIES 2018B
BID OPENING: February 21, 2018, 10:00 A.M., C.T. CONSIDERATION: February 21, 2018, 7:00 P.M., C.T.
PURPOSE/AUTHORITY/SECURITY: The $7,215,000* General Obligation Corporate Purpose Bonds, Series 2018B(the "Bonds") of the City of Cudahy, Wisconsin (the "City") are being issued pursuant to Section 67.04, WisconsinStatutes, for the public purpose of financing street improvements and effecting a current refunding of certain outstandinggeneral obligations of the City as more fully described herein. The Bonds are valid and binding general obligations ofthe City, and all the taxable property in the City is subject to the levy of a tax to pay the principal of and interest on theBonds as they become due which tax may, under current law, be levied without limitation as to rate or amount. Deliveryis subject to receipt of an approving legal opinion of Husch Blackwell LLP, Milwaukee, Wisconsin.
DATE OF BONDS: March 7, 2018MATURITY: April 1 as follows:
Year Amount* Year Amount* Year Amount*2019 $730,000 2024 $505,000 2029 $415,0002020 730,000 2025 435,000 2030 420,0002021 735,000 2026 435,000 2031 425,0002022 730,000 2027 400,000 2032 175,0002023 500,000 2028 405,000 2033 175,000
MATURITYADJUSTMENTS:
* The City reserves the right to increase or decrease the principal amount of the Bonds on theday of sale, in increments of $5,000 each. Increases or decreases may be made in anymaturity. If any principal amounts are adjusted, the purchase price proposed will be adjustedto maintain the same gross spread per $1,000.
TERM BONDS: See "Term Bond Option" herein.INTEREST: October 1, 2018 and semiannually thereafter.OPTIONALREDEMPTION:
Bonds maturing April 1, 2028 and thereafter are subject to call for prior redemption onApril 1, 2027 and any date thereafter, at a price of par plus accrued interest.
MINIMUM BID: $7,124,812.MAXIMUM BID: $7,647,900.GOOD FAITHDEPOSIT:
A good faith deposit in the amount of $144,300 shall be made by the winning bidder by wiretransfer of funds.
PAYING AGENT: To be determined.BOND COUNSEL: Husch Blackwell LLPMUNICIPAL ADVISOR: Ehlers and Associates, Inc.BOOK-ENTRY-ONLY: See "Book-Entry-Only System" herein (unless otherwise specified by the purchaser).
REPRESENTATIONS
No dealer, broker, salesperson or other person has been authorized by the City to give any information or to make any representation other thanthose contained in this Preliminary Official Statement and, if given or made, such other information or representations must not be relied uponas having been authorized by the City. This Preliminary Official Statement does not constitute an offer to sell or a solicitation of an offerto buy any of the Bonds in any jurisdiction to any person to whom it is unlawful to make such an offer or solicitation in such jurisdiction.
This Preliminary Official Statement is not to be construed as a contract with the Syndicate Manager or Syndicate Members. Statementscontained herein which involve estimates or matters of opinion are intended solely as such and are not to be construed as representations offact. Ehlers & Associates, Inc. prepared this Preliminary Official Statement and any addenda thereto relying on information of the City andother sources for which there is reasonable basis for believing the information is accurate and complete. Bond Counsel has not participated inthe preparation of this Preliminary Official Statement and is not expressing any opinion as to the completeness or accuracy of the informationcontained therein. Compensation of Ehlers & Associates, Inc., payable entirely by the City, is contingent upon the sale of the issue.
COMPLIANCE WITH S.E.C. RULE 15c2-12
Certain municipal obligations (issued in an aggregate amount over $1,000,000) are subject to Rule 15c2-12 promulgated by the Securities andExchange Commission pursuant to the Securities Exchange Act of 1934, as amended (the "Rule").
Preliminary Official Statement: This Preliminary Official Statement was prepared for the City for dissemination to potential investors. Its primary purpose is to disclose information regarding the Bonds to prospective underwriters in the interest of receiving competitive proposalsin accordance with the sale notice contained herein. Unless an addendum is posted prior to the sale, this Preliminary Official Statement shallbe deemed nearly final for purposes of the Rule subject to completion, revision and amendment in a Final Official Statement as defined below.
Review Period: This Preliminary Official Statement has been distributed to prospective bidders for review. Comments or requests for thecorrection of omissions or inaccuracies must be submitted to Ehlers & Associates, Inc. at least two business days prior to the sale. Requestsfor additional information or corrections in the Preliminary Official Statement received on or before this date will not be considered aqualification of a proposal received from an underwriter. If there are any changes, corrections or additions to the Preliminary OfficialStatement, interested bidders will be informed by an addendum prior to the sale.
Final Official Statement: Copies of the Final Official Statement will be delivered to the underwriter (Syndicate Manager) within sevenbusiness days following the proposal acceptance.
Continuing Disclosure: Subject to certain exemptions, issues in an aggregate amount over $1,000,000 may be required to comply withprovisions of the Rule which require that underwriters obtain from the issuers of municipal securities (or other obligated party) an agreementfor the benefit of the owners of the securities to provide continuing disclosure with respect to those securities. This Preliminary OfficialStatement describes the conditions under which the Bonds are exempt or required to comply with the Rule.
CLOSING CERTIFICATES
Upon delivery of the Bonds, the underwriter (Syndicate Manager) will be furnished with the following items: (1) a certificate of the appropriateofficials to the effect that at the time of the sale of the Bonds and all times subsequent thereto up to and including the time of the delivery ofthe Bonds, this Preliminary Official Statement did not and does not contain any untrue statement of a material fact or omit to state a materialfact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (2) a receipt signedby the appropriate officer evidencing payment for the Bonds; (3) a certificate evidencing the due execution of the Bonds, including statementsthat (a) no litigation of any nature is pending, or to the knowledge of signers, threatened, restraining or enjoining the issuance and delivery ofthe Bonds, (b) neither the corporate existence or boundaries of the City nor the title of the signers to their respective offices is being contested,and (c) no authority or proceedings for the issuance of the Bonds have been repealed, revoked or rescinded; and (4) a certificate setting forthfacts and expectations of the City which indicates that the City does not expect to use the proceeds of the Bonds in a manner that would causethem to be arbitrage bonds within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, or within the meaning ofapplicable Treasury Regulations.
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TABLE OF CONTENTS
INTRODUCTORY STATEMENT . . . . . . . . . . . . . . . . . . . . . 1
THE BONDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1OPTIONAL REDEMPTION . . . . . . . . . . . . . . . . . . . . . . 1AUTHORITY; PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . 2ESTIMATED SOURCES AND USES . . . . . . . . . . . . . . 3SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3CONCURRENT FINANCING . . . . . . . . . . . . . . . . . . . . 3RATING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3CONTINUING DISCLOSURE . . . . . . . . . . . . . . . . . . . . 4LEGAL OPINION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4STATEMENT REGARDING COUNSEL
PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . . . 5TAX EXEMPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5QUALIFIED TAX-EXEMPT OBLIGATIONS . . . . . . . . 5MUNICIPAL ADVISOR . . . . . . . . . . . . . . . . . . . . . . . . . 6MUNICIPAL ADVISOR AFFILIATED COMPANIES . 6INDEPENDENT AUDITORS . . . . . . . . . . . . . . . . . . . . . 6RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
VALUATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9WISCONSIN PROPERTY VALUATIONS;
PROPERTY TAXES . . . . . . . . . . . . . . . . . . . . . . . 9CURRENT PROPERTY VALUATIONS . . . . . . . . . . . 102017 EQUALIZED VALUE BY CLASSIFICATION . . 10TREND OF VALUATIONS . . . . . . . . . . . . . . . . . . . . . 10LARGER TAXPAYERS . . . . . . . . . . . . . . . . . . . . . . . . 11
DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12DIRECT DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12SCHEDULE OF GENERAL OBLIGATION DEBT . . . 13SCHEDULE OF WATER & SEWER REVENUE
DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15SCHEDULE OF STORM WATER REVENUE DEBT . 16SCHEDULE OF AUTHORITY DEBT . . . . . . . . . . . . . 17DEBT LIMIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18OVERLAPPING DEBT . . . . . . . . . . . . . . . . . . . . . . . . . 18DEBT RATIOS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19DEBT PAYMENT HISTORY . . . . . . . . . . . . . . . . . . . . 19FUTURE FINANCING . . . . . . . . . . . . . . . . . . . . . . . . . 19
TAX LEVIES AND COLLECTIONS . . . . . . . . . . . . . . . . . . 20TAX LEVIES AND COLLECTIONS . . . . . . . . . . . . . . 20PROPERTY TAX RATES . . . . . . . . . . . . . . . . . . . . . . . 21LEVY LIMITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
THE ISSUER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23CITY GOVERNMENT . . . . . . . . . . . . . . . . . . . . . . . . . 23EMPLOYEES; PENSIONS . . . . . . . . . . . . . . . . . . . . . . 23OTHER POST EMPLOYMENT BENEFITS . . . . . . . . 24LITIGATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25MUNICIPAL BANKRUPTCY . . . . . . . . . . . . . . . . . . . 25FUNDS ON HAND . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26ENTERPRISE FUNDS . . . . . . . . . . . . . . . . . . . . . . . . . 27SUMMARY GENERAL FUND INFORMATION . . . . 28
GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . 29LOCATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29LARGER EMPLOYERS . . . . . . . . . . . . . . . . . . . . . . . . 29BUILDING PERMITS . . . . . . . . . . . . . . . . . . . . . . . . . . 30U.S. CENSUS DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . 31EMPLOYMENT/UNEMPLOYMENT DATA . . . . . . . 31
FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . A-1
FORM OF LEGAL OPINION . . . . . . . . . . . . . . . . . . . . . . . B-1
BOOK-ENTRY-ONLY SYSTEM . . . . . . . . . . . . . . . . . . . . C-1
FORM OF CONTINUING DISCLOSURE AGREEMENT D-1
NOTICE OF SALE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-1
BID FORM
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COMMON COUNCIL
Term Expires
John Hohenfeldt Mayor April 2019
Justin Moralez Alderperson April 2019
Mike Johnson Alderperson April 2019
Randy Hollenbeck Alderperson April 2019
Jason Litkowiec Alderperson April 2019
Michele St. Marie-Boelkow Alderperson April 2019
ADMINISTRATION
Dennis Broderick, City Clerk-Treasurer
Carolyn Toms-Neary, Director of Office Services
PROFESSIONAL SERVICES
Paul Eberhardy, City Attorney, Cudahy, Wisconsin
Husch Blackwell LLP, Bond Counsel, Milwaukee, Wisconsin
Ehlers & Associates, Inc., Municipal Advisors, Waukesha, Wisconsin(Other offices located in Roseville, Minnesota, Chicago, Illinois and Denver, Colorado)
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INTRODUCTORY STATEMENT
This Preliminary Official Statement contains certain information regarding the City of Cudahy, Wisconsin (the "City")and the issuance of its $7,215,000* General Obligation Corporate Purpose Bonds, Series 2018B (the "Bonds") or the"Obligations". Any descriptions or summaries of the Bonds, statutes, or documents included herein are not intendedto be complete and are qualified in their entirety by reference to such statutes and documents and the form of theBonds to be included in the resolution awarding the sale of the Bonds (the "Award Resolution") to be adopted by theCommon Council on February 21, 2018.
Inquiries may be directed to Ehlers & Associates, Inc. ("Ehlers" or the "Municipal Advisor"), Waukesha, Wisconsin,(262) 785-1520, the City's Municipal Advisor. A copy of this Preliminary Official Statement may be downloadedfrom Ehlers’ web site at www.ehlers-inc.com by connecting to the Bond Sales link and following the directions atthe top of the site.
THE BONDS
GENERAL
The Bonds will be issued in fully registered form as to both principal and interest in denominations of $5,000 eachor any integral multiple thereof, and will be dated, as originally issued, as of March 7, 2018. The Bonds will matureon April 1 in the years and amounts set forth on the cover of this Preliminary Official Statement. Interest will bepayable on April 1 and October 1 of each year, commencing October 1, 2018, to the registered owners of the Bondsappearing of record in the bond register as of the close of business on the 15th day (whether or not a business day)of the immediately preceding month. Interest will be computed upon the basis of a 360-day year of twelve 30-daymonths and will be rounded pursuant to rules of the Municipal Securities Rulemaking Board ("MSRB"). The ratefor any maturity may not be more than 2.00% less than the rate for any preceding maturity. (For example,if a rate of 4.50% is proposed for the 2019 maturity, then the lowest rate that may be proposed for any latermaturity is 2.50%.) All Bonds of the same maturity must bear interest from the date of issue until paid at a single,uniform rate. Each rate must be expressed in an integral multiple of 5/100 or 1/8 of 1%.
Unless otherwise specified by the purchaser, the Bonds will be registered in the name of Cede & Co., as nominee forThe Depository Trust Company, New York, New York ("DTC"). (See "Book-Entry-Only System" herein.) As longas the Bonds are held under the book-entry system, beneficial ownership interests in the Bonds may be acquired inbook-entry form only, and all payments of principal of, premium, if any, and interest on the Bonds shall be madethrough the facilities of DTC and its participants. If the book-entry system is terminated, principal of, premium, ifany, and interest on the Bonds shall be payable as provided in the Award Resolution.
OPTIONAL REDEMPTION
At the option of the City, the Bonds maturing on or after April 1, 2028 shall be subject to optional redemption priorto maturity on April 1, 2027 and on any date thereafter, at a price of par plus accrued interest.
Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the selectionof the amounts and maturities of the Bonds to be redeemed shall be at the discretion of the City. If only part of theBonds having a common maturity date are called for redemption, then the City or Paying Agent, if any, will notifyDTC of the particular amount of such maturity to be redeemed. DTC will determine by lot the amount of eachparticipant's interest in such maturity to be redeemed and each participant will then select by lot the beneficialownership interest in such maturity to be redeemed.
*Preliminary, subject to change. 1
Notice of such call shall be given by sending a notice by registered or certified mail, facsimile or electronictransmission, overnight delivery service or in any other manner required by DTC, not less than 30 days nor more than60 days prior to the date fixed for redemption to the registered owner of each Bond to be redeemed at the addressshown on the registration books.
AUTHORITY; PURPOSE
The Bonds, Series 2018B (the "Bonds") of the City of Cudahy, Wisconsin (the "City") are being issued pursuant toSection 67.04, Wisconsin Statutes, for the public purpose of financing road improvements and effecting a currentrefunding of the City’s $11,755,000 General Obligation Corporate Purpose Bonds, Series 2011A (the "Series 2011ABonds") as follows:
Issue Being Refunded
Date ofRefunded
IssueCallDate
CallPrice
MaturitiesBeing
RefundedInterestRates
Principal to be
Refunded
CUSIPBase
229759
Series 2011A Bonds 10/13/11 3/27/18 Par 2019 3.000% 985,000 TZ82020 3.000% 1,055,000 UA12021 3.000% 1,065,000 UB92022 3.000% 1,130,000 UC72023 3.125% 320,000 UD52024 3.250% 330,000 UE32025 3.500% 260,000 UF02026 3.625% 265,000 UG82027 3.750% 225,000 UH62028 4.000% 230,000 UJ22029 4.000% 245,000 UK92030 4.000% 250,000 UL72031 4.000% 260,000 UM5
Total Series 2011A Bonds Being Refunded $6,110,000
Proceeds of the Bonds will be used to call and prepay the maturities described above and to pay all or most of thecosts of issuance. The City will pay the principal and interest payment due on March 1, 2018 from the Debt ServiceFund for the Series 2011A Bonds.
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ESTIMATED SOURCES AND USES*
Sources
Par Amount of Bonds $7,215,000
Transfer from Prior Issue Debt Service Funds 44,312
TID 1 Funds on Hand 1,564,659
Interest Earnings 1,869
Total Sources $8,825,840
Uses
Project Costs $2,000,000
Current Refunding Fund 6,635,479
Contingency 1,460
Estimated Discount 90,187
Finance Related Expenses 68,675
Capitalized Interest 30,039
Total Uses $8,825,840
*Preliminary, subject to change.
SECURITY
For the prompt payment of the Bonds with interest thereon and for the levy of taxes sufficient for this purpose, thefull faith, credit and resources of the City will be irrevocably pledged. The City will levy a direct, annual, irrepealabletax on all taxable property in the City sufficient to pay the interest on the Bonds when it becomes due and also to payand discharge the principal on the Bonds at maturity, in compliance with Article XI, Section 3 of the WisconsinConstitution. Such tax may, under current law, be levied without limitation as to rate or amount.
CONCURRENT FINANCING
By means of a separate Preliminary Official Statement, the City will be issuing approximately $1,380,000 GeneralObligation Promissory Notes, Series 2018A (the "Concurrent Obligations" or the "Series 2018A Notes") onFebruary 21, 2018.
RATING
General obligation debt of the City, with the exception of any outstanding credit enhanced issues, is currently rated “Aa3” by Moody's Investor's Service and “AA-” by Standard & Poor's.
The City has requested a rating on this issue from Moody’s Investors Service and Standard & Poor’s, and bidders willbe notified as to the assigned ratings prior to the sale. Such ratings reflect only the views of such organizations andexplanations of the significance of such ratings may be obtained from the respective organizations furnishing thesame.
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Generally, a rating agency bases its rating on the information and materials furnished to it and on investigations,studies and assumptions of its own. There is no assurance that such rating will continue for any given period of timeor that it will not be revised downward or withdrawn entirely by such rating agency, if in the judgement of such ratingagency circumstances so warrant. Any such downward revision or withdrawal of such rating may have an adverseeffect on the market price of the Bonds.
Such rating is not to be construed as a recommendation of the rating agency to buy, sell or hold the Bonds, and therating assigned by the rating agency should be evaluated independently. Except as may be required by the DisclosureUndertaking described under the heading "CONTINUING DISCLOSURE" neither the City nor the underwriterundertake responsibility to bring to the attention of the owner of the Bonds any proposed changes in or withdrawalof such rating or to oppose any such revision or withdrawal.
CONTINUING DISCLOSURE
In order to assist the Underwriters in complying with SEC Rule 15c2-12 promulgated by the Securities and ExchangeCommission, pursuant to the Securities Exchange Act of 1934 (hereinafter the "Rule"), the City shall covenant to takecertain actions pursuant to a Resolution adopted by the Common Council by entering into a Continuing DisclosureUndertaking (the "Disclosure Undertaking") for the benefit of holders, including beneficial holders. The DisclosureUndertaking requires the City to provide electronically or in the manner otherwise prescribed certain financialinformation annually and to provide notices of the occurrence of certain events enumerated in the Rule. The detailsand terms of the Disclosure Undertaking for this issue are set forth in Appendix D to be executed and delivered bythe City at the time of delivery of the Bonds. Such Disclosure Undertaking will be in substantially the form attachedhereto.
In the previous five years, the City believes it has not failed to comply in all material respects with its priorundertakings under the Rule.
A failure by the City to comply with any Disclosure Undertaking will not constitute an event of default on this issueor any issue outstanding. However, such a failure may adversely affect the transferability and liquidity of the Bondsand their market price.
The City will file its continuing disclosure information using the Electronic Municipal Market Access ("EMMA")system or any system that may be prescribed in the future. Investors will be able to access continuing disclosureinformation filed with the MSRB at www.emma.msrb.org. Ehlers is currently engaged as disclosure disseminationagent for the City.
LEGAL OPINION
An opinion as to the validity of the Bonds and the exemption from federal taxation of the interest thereon will befurnished by Husch Blackwell LLP, Bond Counsel to the City, and will be available at the time of delivery of theBonds. The legal opinion will be issued on the basis of existing law and will state that the Bonds are valid andbinding general obligations of the City; provided that the rights of the owners of the Bonds and the enforceability ofthe Bonds may be limited by bankruptcy, insolvency, reorganization, moratorium, and other similar laws affectingcreditors' rights and by equitable principles (which may be applied in either a legal or equitable proceeding).
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STATEMENT REGARDING COUNSEL PARTICIPATION
Bond Counsel has not assumed responsibility for this Preliminary Official Statement or participated in its preparation(except with respect to the section entitled ?TAX EXEMPTION" in the Preliminary Official Statement and the?FORM OF LEGAL OPINION" found in Appendix B).
TAX EXEMPTION
Husch Blackwell LLP, Milwaukee, Wisconsin, Bond Counsel, will deliver a legal opinion with respect to the federalincome tax exemption applicable to the interest on the Bonds under existing law substantially in the following form:
“The interest on the Bonds is excluded from gross income for federal income tax purposes and is not an item oftax preference under Section 57 of the Internal Revenue Code of 1986, as amended (the “Code”), for purposesof the federal alternative minimum tax; such interest is, however, included in adjusted current earnings of certaincorporations for purposes of computing federal alternative minimum tax in effect prior to January 1, 2018 fortax years beginning before such date. The Code contains requirements that must be satisfied subsequent to theissuance of the Bonds in order for interest on the Bonds to be or continue to be excluded from gross income forfederal income tax purposes. Failure to comply with certain of those requirements could cause the interest on theBonds to be included in gross income retroactively to the date of issuance of the Bonds. The City has agreed tocomply with all of those requirements. The opinion set forth in the first sentence of this paragraph is subject tothe condition that the City comply with those requirements. We express no opinion regarding other federal taxconsequences arising with respect to the Bonds.”
Public Law No 115-97 enacted on December 22, 2017, repeals the alternative minimum tax imposed oncorporations for taxable years beginning on or after January 1, 2018.
The interest on the Bonds is not exempt from present Wisconsin income or franchise taxes.
Prospective purchasers of the Bonds should be aware that ownership of the Bonds may result in collateral federalincome tax consequences to certain taxpayers, including, without limitation, financial institutions, property andcasualty insurance companies, individual recipients of Social Security or Railroad Retirement benefits, certain Scorporations with "excess net passive income", foreign corporations subject to the branch profits tax and taxpayerswho may be deemed to have incurred or continued indebtedness to purchase or carry the Bonds. Bond Counsel willnot express any opinion as to such collateral tax consequences. Prospective purchasers of the Bonds should consulttheir tax advisors as to collateral federal income tax consequences.
THE ABOVE DISCUSSION IS ONLY A BRIEF SUMMARY OF THE EFFECTS OF THE CODE, ANDEACH PROSPECTIVE PURCHASER OF THE BONDS SHOULD CONSULT WITH HIS OR HER OWNTAX ADVISOR REGARDING THE TAX EFFECT ON THE ECONOMIC VALUE OF THE BondS.
From time to time, legislation is proposed which, if enacted, could alter one or more of the federal tax matters referredto above or would adversely affect the market value of the Bonds. It cannot be predicted whether or in what form anyof such proposals may be enacted and whether, if enacted, such proposals will apply to obligations (such as the Bonds)issued prior to enactment.
QUALIFIED TAX-EXEMPT OBLIGATIONS
The City will designate the Bonds as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Coderelating to the ability of financial institutions to deduct from income for federal income tax purposes, interest expensethat is allocable to carrying and acquiring tax-exempt obligations.
5
MUNICIPAL ADVISOR
Ehlers has served as municipal advisor to the City in connection with the issuance of the Bonds. The MunicipalAdvisor cannot participate in the underwriting of the Bonds. The financial information included in this PreliminaryOfficial Statement has been compiled by the Municipal 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 compilationsof financial information. Ehlers is not a firm of certified public accountants. Ehlers is registered with the Securitiesand Exchange Commission and the MSRB as a Municipal Advisor.
MUNICIPAL ADVISOR AFFILIATED COMPANIES
Bond Trust Services Corporation ("BTSC") and Ehlers Investment Partners, LLC ("EIP") are affiliate companies ofEhlers. BTSC is chartered by the State of Minnesota and authorized in Minnesota, Wisconsin, and Illinois to transactthe business of a limited purpose trust company. BTSC provides paying agent services to debt issuers. EIP is aRegistered Investment Advisor with the Securities and Exchange Commission. EIP assists issuers with the investmentof bond proceeds or investing other issuer funds. This includes escrow bidding agent services. Issuers, such as theCity, have retained or may retain BTSC and/or EIP to provide these services. If hired, BTSC and/or EIP would beretained by the City under an agreement separate from Ehlers.
INDEPENDENT AUDITORS
The basic financial statements of the City for the fiscal year ended December 31, 2016 have been audited by BakerTilly Virchow Krause, Milwaukee, Wisconsin, independent auditors (the "Auditor"). The report of the Auditor,together with the basic financial statements, component units financial statements, and notes to the financialstatements are attached hereto as "APPENDIX A – FINANCIAL STATEMENTS". The Auditor has not beenengaged to perform and has not performed, since the date of its report included herein, any procedures on the financialstatements addressed in that report. The Auditor also has not performed any procedures relating to this PreliminaryOfficial Statement.
RISK FACTORS
Following is a description of possible risks to holders of the Bonds without weighting as to probability. Thisdescription of risks is not intended to be all-inclusive, and there may be other risks not now perceived or listed here.
Taxes: The Bonds are general obligations of the City, the ultimate payment of which rests in the City's ability to levyand collect sufficient taxes to pay debt service. In the event of delayed billing, collection or distribution of propertytaxes, sufficient funds may not be available to the City in time to pay debt service when due.
State Actions: Many elements of local government finance, including the issuance of debt and the levy of propertytaxes, are controlled by state government. Future actions of the state may affect the overall financial condition of theCity, the taxable value of property within the City, and the ability of the City to levy and collect property taxes.
Future Changes in Law: Various State and federal laws, regulations and constitutional provisions apply to the Cityand to the Bonds. The City can give no assurance that there will not be a change in or interpretation of any suchapplicable laws, regulations and provisions which would have a material effect on the City or the taxing authority ofthe City.
6
Ratings; Interest Rates: In the future, the City's credit rating may be reduced or withdrawn, or interest rates for thistype of obligation may rise generally, either possibility resulting in a reduction in the value of the Bonds for resaleprior to maturity.
Tax Exemption: If the federal government taxes all or a portion of the interest on municipal bonds or notes or if theState government increases its tax on interest on bonds and notes, directly or indirectly, or if there is a change infederal or state tax policy, then the value of these Bonds may fall for purposes of resale. Noncompliance by the Citywith the covenants in the Award Resolution relating to certain continuing requirements of the Code may result ininclusion of interest to be paid on the Bonds in gross income of the recipient for United States income tax purposes,retroactive to the date of issuance.
Continuing Disclosure: A failure by the City to comply with the Disclosure Undertaking for continuing disclosure(see "CONTINUING DISCLOSURE") will not constitute an event of default on the Bonds. Any such failure mustbe reported in accordance with the Rule and must be considered by any broker, dealer, or municipal securities dealerbefore recommending the purchase or sale of the Bonds in the secondary market. Such a failure may adversely affectthe transferability and liquidity of the Bonds and their market price.
Book-Entry-Only System: The timely credit of payments for principal and interest on the Bonds to the accounts ofthe Beneficial Owners of the Bonds may be delayed due to the customary practices, standing instructions or for otherunknown reasons by DTC participants or indirect participants. Since the notice of redemption or other notices toholders of these obligations will be delivered by the City to DTC only, there may be a delay or failure by DTC, DTCparticipants or indirect participants to notify the Beneficial Owners of the Bonds.
Depository Risk: Wisconsin Statutes direct the local treasurer to immediately deposit upon receipt thereof, the fundsof the municipality in a public depository designated by the governing body. A public depository means a federalor state credit union, federal or state savings and loan association, state bank, savings and trust company, mutualsavings bank or national bank in Wisconsin or the local government pooled investment fund operated by the StateInvestment Board. It is not uncommon for a municipality to have deposits exceeding limits of federal and stateinsurance programs. Failure of a depository could result in loss of public funds or a delay in obtaining them. Sucha loss or delay could interrupt a timely payment of municipal debt.
Economy: A combination of economic, climatic, political or civil disruptions or terrorist actions outside of thecontrol of the City, including loss of major taxpayers or major employers, could affect the local economy and resultin reduced tax collections and/or increased demands upon local government. Real or perceived threats to the financialstability of the City may have an adverse effect on the value of the Bonds in the secondary market.
Secondary Market for the Bonds: No assurance can be given that a secondary market will develop for the purchaseand sale of the Bonds or, if a secondary market exists, that such Bonds can be sold for any particular price. Theunderwriters are not obligated to engage in secondary market trading or to repurchase any of the Bonds at the requestof the owners thereof. Prices of the Bonds as traded in the secondary market are subject to adjustment upward anddownward in response to changes in the credit markets and other prevailing circumstances. No guarantee exists asto the future market value of the Bonds. Such market value could be substantially different from the original purchaseprice.
Bankruptcy: The rights and remedies of the holders may be limited by and are subject to the provisions of federalbankruptcy laws, to other laws, or equitable principles that may affect the enforcement of creditors’ rights, to theexercise of judicial discretion in appropriate cases and to limitations on legal remedies against local governments. The opinion of Bond Counsel to be delivered with respect to the Bonds will be similarly qualified. See "MUNICIPALBANKRUPTCY" herein.
7
VALUATIONS
WISCONSIN PROPERTY VALUATIONS; PROPERTY TAXES
Equalized Value
Section 70.57, Wisconsin Statutes, requires the Department of Revenue to annually determine the equalized value(also referred to as full equalized value or aggregate full value) of all taxable property in each county and taxationdistrict. The equalized value is an independent estimate of value used to equate individual local assessment policiesso that property taxes are uniform throughout the various subdivisions in the State. Equalized value is calculatedbased on the history of comparable sales and information about value changes or taxing status provided by the localassessor. A comparison of the State-determined equalized value and the local assessed value, expressed as apercentage, is known as the assessment ratio or level of assessment. The Department of Revenue notifies each countyand taxing jurisdiction of its equalized value on August 15; school districts are notified on October 1. The equalizedvalue of each county is the sum of the valuations of all cities, villages, and towns within its boundaries. Taxingjurisdictions lying in more than one municipality, such as counties, school districts, or special taxing districts, use theequalized value of the underlying units in calculating and levying their respective levies. Equalized values are alsoused to apportion state aids and calculate municipal general obligation debt limits.
Assessed Value
The "assessed value" of taxable property in a municipality is determined by the local assessor, except formanufacturing properties which are valued by the State. Each city, village or town retains its own local assessor, whomust be certified by the State Department of Revenue. Assessed value is used by these municipalities to determinetax levy mill rates and to apportion levies among individual property owners. Each taxing district must assessproperty at full value at least once in every five-year period. The State requires that the assessed values must bewithin 10% of State equalized values at least once every four years. The local assessor values property as of January1 each year and submits those values to each municipality by the second Monday in June. The assessor also reportsany value changes taking place since the previous year, to the Department of Revenue, by the second Monday in June.
8
CURRENT PROPERTY VALUATIONS
2017 Equalized Value $1,136,690,600
2017 Equalized Value Reduced by Tax Increment Valuation $944,345,800
2017 Assessed Value $1,122,486,300
2017 EQUALIZED VALUE BY CLASSIFICATION
2017 Equalized Value
Percent of TotalEqualized Value
Residential $ 770,921,500 67.822%
Commercial 268,233,100 23.598%
Manufacturing 66,202,300 5.824%
Agricultural 900 0.000%
Personal Property 31,332,800 2.756%
Total $1,136,690,600 100.000%
TREND OF VALUATIONS
YearAssessed
ValueEqualized
Value1
PercentIncrease/Decreasein Equalized Value
2013 $1,285,413,200 $1,177,403,800 -4.02%
2014 1,264,188,800 1,219,166,500 3.55%
2015 1,115,335,100 1,095,819,200 -10.12%
2016 1,123,193,900 1,089,420,200 -0.58%
2017 1,122,486,300 1,136,690,600 4.34%
Source: Wisconsin Department of Revenue, Bureau of Equalization and Local Government Services Bureau.
1 Includes tax increment valuation.
9
LARGER TAXPAYERS
Taxpayer Type of Business/Property
2017Equalized
Value1
Percent of City's Total
Equalized Value
OCP Milwaukee MT, LLC Manufacturing $ 15,890,840 1.40%
Patrick Cudahy LLC Manufacturing 13,931,650 1.23%
LST Limited Partnership Commercial 12,030,690 1.06%
ATI Ladish Manufacturing 10,241,780 0.90%
Phoenix JCR Cudahy Manufacturing 9,856,880 0.87%
1900 College Avenue LLC Commercial 7,191,460 0.63%
MRC I LLC Commercial 6,798,220 0.60%
Hansen Storage Company Commercial 6,697,840 0.59%
Centerpoint Manufacturing 6,267,690 0.55%
Building Investors Commercial 5,848,900 0.51%
Total $ 94,755,950 8.34%
City's Total 2017 Equalized Value2 $1,136,690,600
Source: The City.
1 Calculated by dividing the 2017 Assessed Values by the 2017 Aggregate Ratio of assessment for the City.
2 Includes tax increment valuation.
10
DEBT
DIRECT DEBT1*
General Obligation Debt (see schedules following)
Total General Obligation Debt* (includes the Obligations and the ConcurrentObligations, as defined herein)
$ 30,570,000
Revenue Debt (see schedules following)
Total revenue debt secured by water and sewer revenues $ 4,475,000
Total revenue debt secured by storm water revenues $ 4,665,000
Lease Revenue Obligations (see schedule following)
Total Lease Revenue Obligations Paid by Annual Appropriations $ 9,720,000
*Preliminary, subject to change.
1 Outstanding debt is as of the dated date of the Obligations.
11
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,038
328,
038
1,38
0,00
069
.16%
2030
2031
285,
000
43,7
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5,00
043
,759
328,
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1,09
5,00
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.53%
2031
2032
295,
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33,7
8829
5,00
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,788
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82.1
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3220
3330
0,00
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23,3
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0,00
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.83%
2033
2034
500,
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9,06
350
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09,
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0.00
%20
34
130,
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2,60
04,
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1,39
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813
Wat
er &
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ys
4/2/
2008
5/1
$1,1
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s 20
08
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5/6/
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2014
C
Pre
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Wat
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14
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.00%
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60,0
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,206
225,
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48,0
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,256
383,
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0,00
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.11%
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55,0
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43,4
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,931
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931
3,53
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.33%
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80,0
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,456
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38,7
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,156
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80,0
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,056
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33,8
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2,88
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.26%
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,731
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5033
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.34%
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18,3
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,506
400,
506
1,87
0,00
059
.91%
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2027
75,0
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,831
275,
000
12,9
5035
0,00
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,781
397,
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0,00
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.42%
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2028
125,
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31,8
3151
0,00
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100
635,
000
36,9
3167
1,93
188
5,00
081
.03%
2028
2029
130,
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27,8
4413
0,00
027
,844
157,
844
755,
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83.8
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2920
3013
5,00
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,538
135,
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23,5
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8,53
862
0,00
086
.71%
2030
2031
140,
000
18,9
8114
0,00
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,981
158,
981
480,
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89.7
1%20
3120
3214
5,00
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,172
145,
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14,1
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9,17
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5,00
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.82%
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2033
150,
000
9,10
015
0,00
09,
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159,
100
185,
000
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3%20
3320
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3,23
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8,23
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00%
2034
185,
000
3,70
01,
710,
000
576,
916
2,77
0,00
036
0,40
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000
941,
016
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6
$2,7
90,0
00
5/1
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rm W
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Rev
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Ser
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2016
E
9/1/
2016
5/1
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rm W
ater
Uti
lity
Rev
enu
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on
ds
5/6/
2014
$1,8
90,0
00
5/1
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2008
Ser
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2014
D
Sch
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f B
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dn
ess
Sto
rm W
ater
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4/2/
2008
$4,1
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Pre
pare
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rm W
ater
Rev
enue
Deb
t
15
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315,
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1934
0,00
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43,2
8491
0,00
07,
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1,12
5,00
05,
906
2,81
5,00
014
6,95
62,
961,
956
4,12
5,00
057
.56%
2019
2020
375,
000
29,9
4562
5,00
039
,015
25,0
0042
,186
1,02
5,00
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1,14
61,
136,
146
3,10
0,00
068
.11%
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2021
380,
000
18,3
3563
5,00
024
,520
041
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1,01
5,00
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,673
1,09
9,67
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2120
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650,
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8,45
010
0,00
040
,093
1,13
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1,18
4,71
895
5,00
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.17%
2022
2023
175,
000
35,1
7417
5,00
035
,174
210,
174
780,
000
91.9
8%20
2320
2419
5,00
028
,226
195,
000
28,2
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3,22
658
5,00
093
.98%
2024
2025
195,
000
20,5
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5,00
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215,
524
390,
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95.9
9%20
2520
2619
5,00
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,480
195,
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12,4
8020
7,48
019
5,00
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.99%
2026
2027
195,
000
4,19
319
5,00
04,
193
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193
010
0.00
%20
27
1,79
0,00
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625
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1) T
he 2
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Bon
ds r
efun
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e 20
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atur
ities
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he 2
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ds
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11$3
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$3,2
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00
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se R
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nd
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ease
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ds
Ser
ies
2011
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nd
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6/1
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2013
A
3/7/
2013
$5,2
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00
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able
Lea
se R
ev
Bn
ds
Ser
ies
2012
B
11/1
/201
2$1
,430
,000
6/1
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/201
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Ser
ies
2012
A
6/1
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ies
2016
C
4/19
/201
6$3
,395
,000
Pre
pare
d by
Ehl
ers
CD
A D
ebt
16
DEBT LIMIT (includes the Obligations and the Concurrent Obligations)*
The constitutional and statutory general obligation debt limit for Wisconsin municipalities, including towns, cities,villages, and counties (Article XI, Section 3 of the Wisconsin Constitution and Section 67.03, Wisconsin Statutes)is 5% of the current equalized value.
Equalized Value $1,136,690,600
Multiply by 5% 0.05
Statutory Debt Limit $ 56,834,530
Less: General Obligation Debt (includes the Obligations and theConcurrent Obligations)*
(30,570,000)
Unused Debt Limit* $ 26,264,530
*Preliminary, subject to change.
OVERLAPPING DEBT1
Taxing District
2017Equalized
Value% In City
TotalG.O. Debt2
City'sProportionate Share
Milwaukee County $ 61,413,297,000 1.8509% $640,375,180 $11,852,704
Milwaukee Area Technical College District 76,548,230,996 1.4849% 106,955,000 1,588,175
Cudahy School District 1,136,690,600 100.0000% 22,963,000 22,963,000
Milwaukee Metropolitan Sewerage District 60,253,027,200 1.5673% 275,840,000 4,323,240
City's Share of Total Overlapping Debt $40,727,119
1 Overlapping debt is as of the dated date of the Obligations. Only those taxing jurisdictions with generalobligation debt outstanding are included in this section.
2 Outstanding debt based on information obtained on EMMA and the Municipal Advisor's records.
17
DEBT RATIOS
G.O. Debt
Debt/EqualizedValue
$1,136,690,600
Debt/ PerCapita18,1861
Total General Obligation Debt (includes the Obligationsand the Concurrent Obligations)*
$ 30,570,000 2.69% $ 1,680.96
City's Share of Total Overlapping Debt 40,727,119 3.58% 2,239.48
Total* $ 71,297,119 6.27% $ 3,920.44
*Preliminary, subject to change.
DEBT PAYMENT HISTORY
The City has no record of default in the payment of principal and interest on its debt.
FUTURE FINANCING
The City has no current plans for additional financing in the next 12 months.
1 Estimated 2017 population.
18
TAX LEVIES AND COLLECTIONS
TAX LEVIES AND COLLECTIONS
Tax YearLevy for City
Purposes Only % Collected
Levy/Equalized Value Reduced by Tax
Increment Valuation in Dollars per $1,000
2013/14 $8,059,878 100% $8.30
2014/15 8,270,370 100% 8.08
2015/16 8,526,507 100% 9.31
2016/17 8,868,593 100% 9.80
2017/18 8,948,594 In Process 9.48
Property tax statements are distributed to taxpayers by the town, village, and city clerks in December of the levy year. Current state law requires counties to pay 100% of the real property taxes levied to cities, villages, towns, schooldistricts and other taxing entities on or about August 20 of the collection year.
Personal property taxes, special assessments, special charges and special taxes must be paid to the town, city or villagetreasurer in full by January 31, unless the municipality, by ordinance, permits special assessments to be paid ininstallments. Real property taxes must be paid in full by January 31 or in two equal installments by January 31 andJuly 31. Alternatively, municipalities may adopt a payment plan which permits real property taxes to be paid in threeor more equal installments, provided that the first installment is paid by January 31, one-half of the taxes are paid byApril 30 and the remainder is paid by July 31. Amounts paid on or before January 31 are paid to the town, city orvillage treasurer. Amounts paid after January 31, are paid to the county treasurer unless the municipality hasauthorized payment in three or more installments in which case payment is made to the town, city or village treasurer. On or before January 15 and February 20 the town, city or village treasurer settles with other taxing jurisdictions forall collections through December and January, respectively. In municipalities which have authorized the paymentof real property taxes in three or more installments, the town, city or village treasurer settles with the other taxingjurisdictions on January 15, February 20 and on the fifteenth day of each month following the month in which aninstallment payment is required. On or before August 20, the county treasurer must settle in full with the underlyingtaxing districts for all real property taxes and special taxes. Any county board may authorize its county treasurer toalso settle in full with the underlying taxing districts for all special assessments and special charges. The county maythen recover any tax delinquencies by enforcing the lien on the property and retain any penalties or interest on thedelinquencies for which it has settled. Uncollected personal property taxes owed by an entity that has ceasedoperations or filed a petition for bankruptcy, or are due on personal property that has been removed from the nextassessment roll are collected from each taxing entity in the year following the levy year.
19
PROPERTY TAX RATES
Full value rates for property taxes expressed in dollars per $1,000 of equalized value (excluding tax incrementvaluation) that have been collected in recent years have been as follows:
Year Levied/Year Collected Schools1 County Local Other2 Total
2013/14 $13.69 $5.13 $8.30 $0.21 $27.33
2014/15 12.37 5.10 8.08 0.20 25.75
2015/16 13.97 5.13 9.31 0.20 28.61
2016/17 13.26 5.10 9.80 0.20 28.36
2017/18 12.75 5.05 9.48 0.00 27.28
Source: Property Tax Rates were extracted from Statement of Taxes prepared by the Wisconsin Department ofRevenue, Division of State and Local Finance.
LEVY LIMITS
Section 66.0602 of the Wisconsin Statutes, imposes a limit on property tax levies by cities, villages, towns andcounties. No city, village, town or county is permitted to increase its tax levy by a percentage that exceeds itsvaluation factor (which is defined as a percentage equal to the greater of either the percentage change in the politicalsubdivision's January 1 equalized value due to new construction less improvements removed between the previousyear and the current or zero percent). The base amount in any year to which the levy limit applies is the actual levyfor the immediately preceding year. In 2018, and in each year thereafter, the base amount is the actual levy for theimmediately preceding year plus the amount of the payment from the State under Section 79.096 of the WisconsinStatutes (an amount equal to the property taxes formerly levied on certain items of personal property), and the levylimit is the base amount multiplied by the valuation factor, minus the amount of the payment from the State underSection 79.096 of the Wisconsin Statutes. This levy limitation is an overall limit, applying to levies for operationsas well as for other purposes.
A political subdivision that did not levy its full allowable levy in the prior year can carry forward the differencebetween the allowable levy and the actual levy, up to a maximum of 1.5% of the prior year's actual levy. The use ofthe carry forward levy adjustment needs to be approved by a majority vote of the political subdivision's governingbody (except in the case of towns) if the amount of carry forward levy adjustment is less than or equal to 0.5% andby a super majority vote of the political subdivision's governing body (three-quarters vote if the governing body iscomprised of five or more members, two-thirds vote if the governing body is comprised of fewer than five members)(except in the case of towns) if the amount of the carry forward levy adjustment is greater than 0.5% up to themaximum increase of 1.5%. For towns, the use of the carry forward levy adjustment needs to be approved by amajority vote of the annual town meeting or special town meeting after the town board has adopted a resolution infavor of the adjustment by a majority vote if the amount of carry forward levy adjustment is less than or equal to 0.5%
1 The Schools tax rate reflects the composite rate of all local school districts and technical college district.
2 Includes the state reforestation tax which is apportioned to each county on the basis of its full value. Counties,in turn, apportion the tax to the tax districts within their borders on the basis of full value. It also includes taxeslevied for special purpose districts such as metropolitan sewerage districts, sanitary districts, and public inlandlake protection districts. Tax increment values are not included.
20
or by two-thirds vote or more if the amount of carry forward levy adjustment is greater than 0.5% up to the maximumof 1.5%.
Beginning with levies imposed in 2015, if a political subdivision does not make an adjustment in its levy as describedin the above paragraph in the current year, the political subdivision may increase its levy by the aggregate amountof the differences between the political subdivision’s valuation factor in the previous year and the actual percentincrease in a political subdivision’s levy attributable to the political subdivision’s valuation factor in the previous year,for the five years before the current year, less any amount of such aggregate amount already claimed as an adjustmentin any of the previous five years. The calculation of the aggregate amount available for such adjustment may notinclude any year before 2014, and the maximum adjustment allowed may not exceed 5%. The use of the adjustmentdescribed in this paragraph requires approval by a two-thirds vote of the political subdivision’s governing body, andthe adjustment may only be used if the political subdivision’s level of outstanding general obligation debt in thecurrent year is less than or equal to the political subdivision’s level of outstanding general obligation debt in theprevious year.
Special provisions are made with respect to property taxes levied to pay general obligation debt service. Those aredescribed below. In addition, the statute provides for certain other exclusions from and adjustments to the tax levylimit. Among the items excluded from the limit are amounts levied for any revenue shortfall for debt service on arevenue bond issued under Section 66.0621. Among the adjustments permitted is an adjustment applicable when atax increment district terminates, which allows an amount equal to the prior year's allowable levy multiplied by 50%of the political subdivision's percentage growth due to the district's termination.
With respect to general obligation debt service, the following provisions are made:
(a) If a political subdivision's levy for the payment of general obligation debt service, including debt service on debtissued or reissued to fund or refund outstanding obligations of the political subdivision and interest on outstandingobligations of the political subdivision, on debt originally issued before July 1, 2005, is less in the current year thanin the previous year, the political subdivision is required to reduce its levy limit in the current year by the amount ofthe difference between the previous year's levy and the current year's levy.
(b) For obligations authorized before July 1, 2005, if the amount of debt service in the preceding year is less than theamount of debt service needed in the current year, the levy limit is increased by the difference between the twoamounts. This adjustment is based on scheduled debt service rather than the amount actually levied for debt service(after taking into account offsetting revenues such as sales tax revenues, special assessments, utility revenues, taxincrement revenues or surplus funds). Therefore, the levy limit could negatively impact political subdivisions thatexperience a reduction in offsetting revenues.
(c) The levy limits do not apply to property taxes levied to pay debt service on general obligation debt authorizedon or after July 1, 2005.
The Obligations were authorized after July 1, 2005 and therefore the levy limits do not apply to taxes levied to paydebt service on the Obligations.
21
THE ISSUER
CITY GOVERNMENT
The City was incorporated in 1906 and is governed by a Mayor and a five-member Common Council. The Mayordoes not vote except in the case of a tie. All Council Members are elected to three-year terms. The electedComptroller and City Clerk-Treasurer are responsible for administrative details and financial records.
EMPLOYEES; PENSIONS
The City employs a staff of 120 full-time, 105 part-time, and 12 seasonal employees. All eligible employees in theCity are covered under the Wisconsin Retirement System ("WRS") established under Chapter 40 of the WisconsinStatutes ("Chapter 40"). The WRS is a cost-sharing multiple-employer defined benefit pension plan. The Departmentof Employee Trust Funds ("ETF") administers the WRS. Required contributions to the WRS are determined by theETF Board pursuant to an annual actuarial valuation in accordance with Chapter 40 and the ETF's funding policies. The ETF Board has stated that its funding policy is to (i) ensure funds are adequate to pay benefits; (ii) maintain stableand predictable contribution rates for employers and employees; and (iii) maintain inter-generational equity to ensurethe cost of the benefits is paid for by the generation that receives the benefits.
City employees are required to contribute half of the actuarially determined contributions, and the City may not paythe employees' required contribution. The total retirement plan contributions (including both the City’s and theemployees' contributions) for the fiscal year ended December 31, 2014 were $1.4 million. During the fiscal yearended December 31, 2015 ("Fiscal Year 2015") and the fiscal year ended December 31, 2016 ("Fiscal Year 2016"),the City’s portion of contributions to WRS (not including any employee contributions) totaled $796,168 and $757,175respectively.
The City implemented Governmental Accounting Standards Board Statement No. 68 ("GASB 68") for Fiscal Year2016.
GASB 68 requires calculation of a net pension liability for the pension plan. The net pension liability is calculatedas the difference between the pension plan's total pension liability and the pension plan's fiduciary net position. Thepension plan's total pension liability is the present value of the amounts needed to pay pension benefits earned by eachparticipant in the pension plan based on the service provided as of the date of the actuarial valuation. In other words,it is a measure of the present value of benefits owed as of a particular date based on what has been earned only up tothat date, without taking into account any benefits earned after that date. The pension plan's fiduciary net positionis the market value of plan assets formally set aside in a trust and restricted to paying pension plan benefits. If thepension plan's total pension liability exceeds the pension plan's fiduciary net position, then a net pension liabilityresults. If the pension plan's fiduciary net position exceeds the pension plan's total pension liability, then a net pensionasset results.
As of December 31, 2015, the total pension liability of the WRS was calculated as $90.1 billion and the fiduciary netposition of the WRS was calculated as $88.5 billion, resulting in a net pension liability of $1.6 billion.
Under GASB 68, each participating employer in a cost-sharing pension plan must report the employer's proportionateshare of the net pension liability or net pension asset of the pension plan. Accordingly, for Fiscal Year 2016, the Cityreported an asset of $1,306,299 for its proportionate share of the net pension asset of the WRS. The net pensionliability was measured as of December 31, 2015 based on the City’s share of contributions to the pension plan relativeto the contributions of all participating employers. The City’s proportion was 0.08038862% of the aggregate WRSnet pension asset as of December 31, 2015.
22
The calculation of the total pension liability and fiduciary net position are subject to a number of actuarialassumptions, which may change in future actuarial valuations. Such changes may have a significant impact on thecalculation of net pension liability of the WRS, which may also cause the ETF Board to change the contributionrequirements for employers and employees. For more detailed information regarding the WRS and such actuarialassumptions, see "APPENDIX A - FINANCIAL STATEMENTS" attached hereto.
Recognized and Certified Bargaining Units
All eligible City personnel are covered by the Municipal Employment Relations Act ("MERA") of the WisconsinStatutes. Pursuant to that law, employees have rights to organize and collectively bargain with municipal employers. MERA was amended by 2011 Wisconsin Act 10 (the "Act") and by 2011 Wisconsin Act 32, which altered thecollective bargaining rights of public employees in Wisconsin.
As a result of the 2011 amendments to MERA, the City is prohibited from bargaining collectively with municipalemployees, other than public safety and transit employees, with respect to any factor or condition of employmentexcept total base wages. Even then, the City is limited to increasing total base wages beyond any increase in theconsumer price index since 180 days before the expiration of the previous collective bargaining agreement (unlessCity were to seek approval for a higher increase through a referendum). Ultimately, the City can unilaterallyimplement the wages for a collective bargaining unit.
Under the changes to MERA, impasse resolution procedures were removed from the law for municipal employeesof the type employed by the City, including binding interest arbitration. Strikes by any municipal employee or labororganization are expressly prohibited. As a practical matter, it is anticipated that strikes will be rare. Furthermore,if strikes do occur, they may be enjoined by the courts. Additionally, because the only legal subject of bargainingis the base wage rates, all bargaining over items such as just cause, benefits, and terms of conditions of employmentare prohibited and cannot be included in a collective bargaining agreement. Impasse resolution for public safetyemployees and transit employees is subject to final and binding arbitration procedures, which do not include a rightto strike. Interest arbitration is available for transit employees if certain conditions are met.
The following bargaining units represent employees of the City:
Bargaining UnitExpiration Date of Current Contract
International Association of Firefighters AFL-CIO,Local 1801
December 31, 2018
Cudahy Professional Police Association December 31, 2018
Command Officers in Police Department December 31, 2018
OTHER POST EMPLOYMENT BENEFITS
The City has obligations for some post-employment benefits for its employees. Accounting for these obligations isdictated by Governmental Accounting Standards Board Statement No. 45 (GASB 45). The City‘s most recentactuarial study of its OPEB obligations shows an actuarial accrued liability of $6,276,343 as of December 31, 2016.
23
LITIGATION
There is no litigation threatened or pending questioning the organization or boundaries of the City or the right of anyof its officers to their respective offices or in any manner questioning their rights and power to execute and deliverthe Obligations or otherwise questioning the validity of the Obligations.
MUNICIPAL BANKRUPTCY
Municipalities are prohibited from filing for bankruptcy under Chapter 11 (reorganization) or Chapter 7 (liquidation)of the U.S. Bankruptcy Code (11 U.S.C. §§ 101-1532) (the "Bankruptcy Code"). Instead, the Bankruptcy Codepermits municipalities to file a petition under Chapter 9 of the Bankruptcy Code, but only if certain requirements aremet. These requirements include that the municipality must be "specifically authorized" under State law to file forrelief under Chapter 9. For these purposes, "State law" may include, without limitation, statutes of generalapplicability enacted by the State legislature, special legislation applicable to a particular municipality, and/orexecutive orders issued by an appropriate officer of the State’s executive branch.
As of the date hereof, Wisconsin law contains no express authority for municipalities to file for bankruptcy reliefunder Chapter 9 of the Bankruptcy Code.
Nevertheless, there can be no assurance (a) that State law will not change in the future, while the Obligations areoutstanding, in a way that would allow the City to file for bankruptcy relief under Chapter 9 of the Bankruptcy Code;or (b) even absent such a change in State law, that an executive order or other executive action could not effectivelyauthorize the City to file for relief under Chapter 9. If, in the future, the City were to file a bankruptcy case underChapter 9, the relevant bankruptcy court would need to consider whether the City could properly do so, which wouldinvolve questions regarding State law authority as well as other questions such as whether the City is a municipalityfor bankruptcy purposes. If the relevant bankruptcy court concluded that the City could properly file a bankruptcycase, and that determination was not reversed, vacated, or otherwise substantially altered on appeal, then the rightsof holders of the Obligations could be modified in bankruptcy proceedings. Such modifications could be adverseto holders of the Obligations, and there could ultimately be no assurance that holders of the Obligations would bepaid in full or in part on the Obligations. Further, under such circumstances, there could be no assurance that theObligations would not be treated as general, unsecured debt by a bankruptcy court, meaning that claims of holdersof the Obligations could be viewed as having no priority (a) over claims of other creditors of the City; (b) to anyparticular assets of the City, or (c) to revenues otherwise designated for payment to holders of the Obligations. Moreover, if the City were determined not to be a "municipality" for the purposes of the Bankruptcy Code, norepresentations can be made regarding whether it would still be eligible for voluntary or involuntary relief underChapters of the Bankruptcy Code other than Chapter 9 or under similar federal or state law or equitable proceedingregarding insolvency or providing for protection from creditors. In any such case, there can be no assurance that theconsequences described above for the holders of the Obligations would not occur.
24
FUNDS ON HAND (as of November 30, 2017)
FundTotal Cash
and Investments
General $ 6,761,536
Special Revenue 3,437,259
Debt Service 5,857,418
Capital Projects 3,152,631
Enterprise Funds 9,760,374
Total Funds on Hand $ 28,969,218
25
ENTERPRISE FUNDS
Revenues available for debt service on the City's enterprise funds have been as follows as of December 31 each year:
2014 2015 2016
Water
Total Operating Revenues $ 2,803,325 $ 2,632,139 $ 3,075,841
Less: Operating Expenses (3,034,118) (2,059,697) (2,111,816)
Operating Income $ (230,793) $ 572,442 $ 964,025
Plus: Depreciation 509,569 506,916 516,971
Miscellaneous Revenue 0 20,000 30,000
Interest Income 298 799 2,426
Revenues Available for Debt Service $ 279,074 $ 1,100,157 $ 1,513,422
Sewer
Total Operating Revenues $ 2,586,536 $ 2,821,820 $ 3,180,211
Less: Operating Expenses (2,171,270) (2,363,761) (2,570,686)
Operating Income $ 415,266 $ 458,059 $ 609,525
Plus: Depreciation 114,053 114,835 117,815
Miscellaneous Revenue 292 370 0
Interest Income 3,514 7,913 12,429
Revenues Available for Debt Service $ 533,125 $ 581,177 $ 739,769
Storm Water
Total Operating Revenues $ 1,169,904 $ 1,351,688 $ 1,451,450
Less: Operating Expenses (658,826) (684,656) (670,897)
Operating Income $ 511,078 $ 667,032 $ 780,553
Plus: Depreciation 251,673 239,072 224,896
Miscellaneous Revenue 0 5,022 0
Interest Income 3,386 6,124 10,455
Revenues Available for Debt Service $ 766,137 $ 917,250 $ 1,015,904
26
SUMMARY GENERAL FUND INFORMATION
Following are summaries of the revenues and expenditures and fund balances for the City's General Fund. These summaries arenot purported to be the complete audited financial statements of the City, and potential purchasers should read the includedfinancial statements in their entirety for more complete information concerning the City. Copies of the complete audited financialstatements are available upon request. See Appendix A for the City's 2016 audited financial statements.
FISCAL YEAR ENDING DECEMBER 31COMBINED STATEMENT 2014 Audited 2015 Audited 2016 Audited 2017
Unaudited12018
AdoptedBudget2
RevenuesTaxes and special assessments $ 5,811,071 $ 5,794,269 $ 6,164,001 $ 6,213,508 $ 6,270,835Intergovernmental 4,684,507 4,797,374 4,866,878 4,879,458 4,576,141Licenses and permits 519,976 500,763 540,756 481,834 552,860Fines, forfeitures and penalties 794,176 857,361 958,436 974,955 1,016,829Public charges for services 404,290 388,221 149,722 252,659 239,176Interdepartmental charges for services 30,987 31,823 33,219 34,554 32,550Interest 33,136 27,291 67,556 34,483 63,000Commercial revenues 133,427 121,329 143,127 68,874 66,850
Total Revenues $ 12,411,570 $ 12,518,431 $ 12,923,695 $ 12,940,325 $ 12,818,241
ExpendituresCurrent:
General government $ 2,671,652 $ 2,720,868 $ 2,853,679 $ 3,003,428 $ 2,890,682Protection of persons and property 7,482,618 7,312,358 7,383,914 7,117,203 7,569,953Public works 1,544,958 1,513,446 1,443,742 1,485,197 1,761,867Health and sanitation 968,745 865,703 937,325 857,464 996,631Park and recreation 168,750 257,208 238,415 323,335 367,008
Capital outlay 28,741 21,122 56,340 10,638 20,600Total Expenditures $ 12,865,464 $ 12,690,705 $ 12,913,415 $ 12,797,265 $ 13,606,741
Excess of revenues over (under) expenditures $ (453,894) $ (172,274) $ 10,280 $ 143,060 $ (788,500)Other Financing Sources (Uses)
Proceeds from capital lease 0 0 0 0 0Proceeds of long-term debt 0 0 0 0 0Operating transfers in 395,328 448,465 447,702 456,625 446,500Operating transfers out 0 0 0 0 0
Total Other Financing Sources (Uses) $ 395,328 $ 448,465 $ 447,702 $ 456,625 $ 446,500
Excess of revenues and other financingsources over (under) expenditures and otherfinancing uses
$ (58,566) $ 276,191 $ 457,982 $ 599,685 $ (342,000)
General Fund Balance January 1 4,204,974 4,146,408 4,422,599 4,880,581 5,480,266Prior Period AdjustmentResidual Equity Transfer in (out)
General Fund Balance December 31 $ 4,146,408 $ 4,422,599 $ 4,880,581 $ 5,480,266 $ 5,138,266
DETAILS OF DECEMBER 31 FUND BALANCENonspendable 267,208 987,815 894,410 576,948 580,000Restricted 0 0 0 0 0Committed 0 0 0 0 0Assigned 229,847 232,545 313,600 216,952 220,000Unassigned 3,649,353 3,202,239 3,672,571 4,686,366 4,338,266Total $ 4,146,408 $ 4,422,599 $ 4,880,581 $ 5,480,266 $ 5,138,266
1 Unaudited data is as of December 31, 2017.
2 The 2018 budget was adopted on November 21, 2017.
27
GENERAL INFORMATION
LOCATION
The City of Cudahy, with a 2010 U.S. Census population of 18,267 and a current estimated population of 18,186comprises an area of 3.75 square miles and is located just south of the City of Milwaukee in Milwaukee County.
LARGER EMPLOYERS1
Larger employers in the City include the following:
Firm Type of Business/ProductEstimated No.of Employees
Patrick Cudahy, Inc. Manufacturer of bacon and sausage products 1,190
ATI Ladish Co. Forging manufacturer 800
Aurora St. Lukes South Shore Hospital 615
School District of Cudahy Elementary and secondary education 347
Fedex Ground Package System Inc. Small package delivery 250
Vilter Manufacturing Manufacture industrial compressors 250
City of Cudahy Municipal government and services 237
Lucas-Milhaupt, Inc. Corporate headquarters, producer of metal joining products 200
WM Berg Inc. Manufacture components 200
ACE Worldwide Moving & Storage Transportation and warehousing 150
Source: ReferenceUSA, written and telephone survey (January 2018), Wisconsin Manufacturers Register,2017-2018 Milwaukee Business Journal Book of Lists and the Wisconsin Department of WorkforceDevelopment.
1 This does not purport to be a comprehensive list and is based on available data obtained through a survey ofindividual employers, as well as the sources identified above. Some employers do not respond to inquiries foremployment data.
28
BUILDING PERMITS
2014 2015 2016 2017 20181
New Single Family Homes
No. of building permits 1 0 1 1 0
Valuation $176,700 $0 $121,000 $150,000 $0
New Multiple Family Buildings
No. of building permits 1 1 1 0 0
Valuation $465,000 $465,000 $6,890,800 $0 $0
New Commercial/Industrial
No. of building permits 2 6 1 1 0
Valuation $2,240,000 $1,844,000 $599,200 $6,600,000 $0
All Building Permits(including additions and remodelings)
No. of building permits 180 144 186 184 0
Valuation $6,741,764 $8,995,840 $10,750,045 $16,012,699 $0
Source: The City.
1 As of January 19, 2018.
29
U.S. CENSUS DATA
Population Trend: City of Cudahy
2000 U.S. Census 18,429
2010 U.S. Census 18,267
2017 Estimated Population 18,186
Percent of Change 2000 - 2010 + -0.88%
Income and Age Statistics
City of CudahyMilwaukee
CountyState of
WisconsinUnitedStates
2016 per capita income $25,127 $25,881 $29,253 $29,829
2016 median household income $46,973 $45,263 $54,610 $55,322
2016 median family income $59,117 $57,738 $69,925 $67,871
2016 median gross rent $769 $821 $789 $9282016 median value owner occupied units $150,400 $150,000 $167,000 $184,700
2016 median age 41.8 yrs. 34.3 yrs. 39.1 yrs. 37.7 yrs.
State of Wisconsin United States
City % of 2016 per capita income 85.90% 84.24%
City % of 2016 median family income 84.54% 87.10%
Housing Statistics
City of Cudahy
2000 2016 Percent of Change
All Housing Units 8,273 8,044 -2.77%
Source: 2000 and 2010 Census of Population and Housing, and 2016 American Community Survey (Based on a five-year estimate), U.S. Census Bureau (www.factfinder2.census.gov).
EMPLOYMENT/UNEMPLOYMENT DATA
Rates are not compiled for individual communities with populations under 25,000.
Average Employment Average Unemployment
Year Milwaukee County Milwaukee County State of Wisconsin
2013 439,273 8.4% 6.7%
2014 446,154 6.9% 5.4%
2015 449,935 5.8% 4.6%
2016 454,475 5.1% 4.1%
2017, November 464,128 3.4% 2.7%
Source: Wisconsin Department of Workforce Development.
30
APPENDIX A
FINANCIAL STATEMENTS
Potential purchasers should read the included financial statements in their entirety for more complete informationconcerning the City’s financial position. Such financial statements have been audited by the Auditor, to the extent andfor the periods indicated thereon. The City has not requested the Auditor to perform any additional examination,assessments or evaluation with respect to such financial statements since the date thereof, nor has the City requestedthat the Auditor consent to the use of such financial statements in this Official Statement. Although the inclusion ofthe financial statements in this Official Statement is not intended to demonstrate the fiscal condition of the City sincethe date of the financial statements, in connection with the issuance of the Bonds, the City represents that there havebeen no material adverse change in the financial position or results of operations of the City, nor has the City incurredany material liabilities, which would make such financial statements misleading.
Copies of the complete audited financial statements for the past three years and the current budget are available uponrequest from Ehlers.
A-1
CITY OF CUDAHY Cudahy, Wisconsin
FINANCIAL STATEMENTS
Including Independent Auditor's Report
As of and for the Year Ended December 31 , 2016
A-2
~AKER TILLY
INDEPENDENT AUDITORS' REPORT
To the Mayor and Common Council City of Cudahy Cudahy, Wisconsin
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Cudahy, Wisconsin , as of and for the year ended December 31, 2016, and the related notes to the financial statements, which collectively comprise the City of Cudahy's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the City of Cudahy's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the City of Cudahy's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
"8AKER TILLY Page 1
INTERNATIONAL A-3
To the Mayor and Common Council City of Cudahy
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Cudahy, Wisconsin, as of December 31, 2016 and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the required supplementary information as listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Cudahy's basic financial statements. The supplementary information as listed in the table of contents is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated in all material respects, in relation to the basic financial statements as a whole.
Milwaukee, Wisconsin June 1, 2017
Page 2 A-4
A-5
A-6
A-7
A-8
A-9
CITY OF CUDAHY
STATEMENT OF NET POSITION As of December 31 , 2016
Governmental Business-type Activities Activities Total
ASSETS Cash and investments $ 16,474,291 $ 2,833,157 $ 19,307,448 Taxes receivable 15,639,318 15,639,318 Accounts receivable, net of allowance of $34,427 145,199 2,248,994 2,394,193 Accrued investment income 39,222 39,222 Special assessments receivable 363,704 363,704 Loans receivable 797,424 797,424 Other receivables 142,299 498 142,797 Internal balances (275,528) 275,528 Prepaid items 283,520 283,520 Deposit with Cities and Villages
Mutual Insurance Company 722,170 722,170 Advances 702,653 (702,653) Materials and supply inventory 50,426 50,426 Restricted assets
Cash and investments 2,450,133 6,569,857 9,019,990 Land held for resale 4,728,340 4,728,340 Capital assets
Land 14,599,528 220,342 14,819,870 Other capital assets, net of depreciation 36,974,891 33,191,088 70,165,979 Construction in progress 232,429 24,685 257,114
Total Assets 94,019,593 44,711,922 138,731,515
DEFERRED OUTFLOWS OF RESOURCES Unamortized loss on refunding 873,240 228,483 1,101,723 Deferred outflows related to pensions 6,750,024 572,109 7,322,133
Total Deferred Outflows of Resources 7,623,264 800,592 8,423,856
LIABILITIES Accounts payable and other current liabilities 1,030,846 1,052,538 2,083,384 Accrued interest payable 306,501 86,287 392,788 Noncurrent liabilities
Net pension liability 1,204,785 101 ,514 1,306,299 Due within one year 6,751,285 821,575 7,572,860 Due in more than one year 44,775,396 12,758,821 57,534,217
Total Liabilities 54,068,813 14,820,735 68,889,548
DEFERRED INFLOWS OF RESOURCES Unearned revenue 15,033,291 15,033,291 Deferred inflows related to pensions 2,535,451 213,634 2,749,085
Total Deferred Inflows of Resources 17,568,742 213,634 17,782,376
NET POSITION Net investment in capital assets 33,982,086 25,345,032 55,782,599 Restricted for
Debt service 3,842,547 296,862 4,139,409 TIO activities 3,989,233 3,989,233 Library endowment 100,000 100,000 Library capital improvements 441 ,709 441,709 Library operations 365,720 365,720 Equipment replacement 1,087,888 1,087,888
Unrestricted (Deficit) {12,715,993) 3,748,363 {5,423,111)
TOT AL NET POSITION $ 30,005,302 $ 30,478,145 $ 60,483,447
See accompanying notes to financial statements . Page 13 A-10
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ax
Incr
em
en
t In
cre
me
nt
Oth
er
Tot
al
Dis
tric
t #1
De
bt
Dis
tric
t #1
Cap
ital
Go
vern
me
nta
l G
ove
rnm
en
tal
Gen
eral
T
ax
Le.':'
.'.l.._
S
erv
ice
C
a12i
tal P
roje
cts
.!!:!!
P_r
ovem
ents
F
unds
F
unds
AS
SE
TS
C
ash
and
inve
stm
en
ts
$ 3,
463,
709
$ 60
1,98
1 $
4,1
49
,04
8
$ -
$ 4
,06
4,1
75
$
3,66
3,04
9 $
15
,94
1,9
62
A
cco
un
ts r
ecei
vabl
e (n
et o
f allo
wan
ce
unco
llect
ible
s o
f $3
4,4
27
) 2,
720
12
3,1
89
1
25
,90
9
Tax
es r
ecei
vabl
e 6
,59
2,7
45
5,
280,
648
1,5
26
,07
8
5,1
74
2
,23
4,6
73
1
5,6
39
,31
8
Spe
cial
ass
ess
me
nts
rec
eiva
ble
4,5
49
3
59
,15
5
36
3,7
04
L
oa
ns
rece
ivab
le
79
7,4
24
7
97
,42
4
Oth
er
rece
ivab
les
143,
161
22,3
51
. 1
65
,51
2
Du
e fr
om o
the
r fu
nd
s 8
65
,76
6
-8
65
,76
6
Adv
ance
to o
the
r fu
nd
s 7
02
,65
3
T
10
0,0
00
8
02
,65
3
Res
tric
ted
cash
and
in
vest
me
nts
1
,54
4,7
49
-
90
5,3
84
2
,45
0,1
33
P
repa
id i
tem
s 27
6,56
0 -
4,7
36
2,2
24
28
3,52
0
Tot
al A
sset
s $
12
,04
4,5
94
$
_ 5,9
04,~
8_0_
$_
7'_,
_219
,875
$
80
7,1
47
$
4,07
1,63
1 i_
__L3
87,6
74
$ 37
,435
,901
Se
e a
cco
mp
an
yin
g n
otes
to
finan
cial
sta
tem
ents
. P
ag
e 1
5
A-12
LIA
BIL
ITIE
S
Acc
ount
s pa
yabl
e A
ccru
ed l
iabi
litie
s D
ue to
oth
er fu
nds
Adv
ance
from
oth
er
fund
s
Tot
al L
iabi
litie
s
DE
FE
RR
ED
INFL
OW
S O
F R
ES
OU
RC
ES
U
near
ned
reve
nues
U
nava
ilabl
e re
venu
es
Tot
al D
efer
red
Inflo
ws
of R
esou
rces
FU
ND
BA
LA
NC
ES
N
onsp
enda
ble
Res
tric
ted
Com
mitt
ed
Ass
igne
d U
nass
igne
d (D
efic
it)
Tot
al F
und
Bal
ance
s
TO
T A
L L
IAB
ILIT
IES
, DE
FE
RR
ED
IN
FL
OW
S O
F R
ES
OU
RC
ES
, A
ND
FU
ND
BA
LA
NC
ES
CIT
Y O
F C
UD
AH
Y
BA
LA
NC
E S
HE
ET
G
OV
ER
NM
EN
TA
L F
UN
DS
A
s o
f De
cem
be
r 31
, 20
16
Tax
T
ax
Incr
emen
t In
crem
ent
Oth
er
Tot
al
Dis
tric
t #1
Deb
t D
istr
ict #
1 C
apita
l G
over
nmen
tal
Gov
ernm
enta
l G
ener
al
Tax
Le
vy_
S
ervi
ce
Cap
ital
Pro
ject
s .!!
!!.P
_rov
emen
ts
Fun
ds
Fun
ds
$ 39
9,36
7 $
-$
-$
-$
36,7
99
$ 13
4,12
5 $
570,
291
282,
283
28,8
17
311,
100
275,
528
--
402,
155
463,
611
1,14
1,29
4 10
0,00
0 10
0,00
0
957,
178
-40
2,15
5 36
,799
72
6,55
3 2,
122,
685
6,2
06,8
35
5,2
80,6
48
1,52
6,07
8 -
2,01
9,7
30
15,0
33,2
91
9,7
15
-58
0,10
1 58
9,81
6
6,20
6,83
5 5
,280
,648
1,
526
,078
9,
715
2,5
99,8
31
15,6
23,1
07
894,
410
4,73
6 10
2,22
4 1,
001,
370
624,
332
5,69
3,79
7 79
7,42
4 2
,586
,264
9,
701
,817
1
,850
,142
1,
850
,142
31
3,60
0 4,
030
,096
13
1,37
8 4,
475,
074
3,67
2,57
1 (4
02,1
47)
(6
08,7
18)
2,66
1,70
6
4,88
0,51
lj_
624,
332
____
§_,6
93, 7
97
395,
277
__
4_,0
34,8
3~
4,06
1,29
0 19
,690
,109
$1
2,0
44
,594
$
5,9
04
,980
$
7,2
19
,875
$
807
,147
$
4,07
1,63
1 $
7,38
7,6
74
$
37,4
35,9
01
See
acc
ompa
nyin
g no
tes
to f
inan
cial
sta
tem
ents
. P
age
16
A-13
CITY OF CUDAHY
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION For the Year Ended December 31, 2016
Fund balance - total governmental funds
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets and other assets used in governmental funds are not financial resources and, therefore, are not reported in the funds.
Land held for resale Land Construction in progress Other capital assets Less: Accumulated depreciation
Some receivables that are not currently available are reported as deferred revenue in the fund financial statements but are recognized as revenue when earned in the government-wide statements.
Special assessments
Internal service funds are used by management to charge costs of insurance coverage to individual funds. The assets and liabilities of the internal service fund are included in government activities in the statement of net position.
The net pension liability does not relate to current financial resources and is not reported in the governmental funds.
Deferred outflows of resources related to pensions do not relate to current financial resources and are not reported in the governmental funds
Deferred inflows of resources related to pensions do not relate to current financial resources and are not reported in the governmental funds
Some liabilities, including long-term debt, are not due and payable in the current period and, therefore, not reported in the funds.
Bonds and notes payable Unamortized loss on refunding Unamortized debt premium Compensated absences Accrued interest Unfunded OPEB liability
NET POSITION OF GOVERNMENTAL ACTIVITIES
See accompanying notes to financial statements.
$ 19,690,109
4,728,340 14,599,528
232,429 68,351,946
(31,377,055)
589,812
1,140,347
(1,204,785)
6,750,024
(2,535,451)
(43,785,068) 873,240
(693,497) (901,607) (306,501)
(6,146,509)
$ 30,005,302
Page 17 A-14
CIT
Y O
F C
UD
AH
Y
ST
AT
EM
EN
T O
F R
EV
EN
UE
S,
EX
PE
ND
ITU
RE
S,
AN
D C
HA
NG
ES
IN F
UN
D B
AL
AN
CE
S-
GO
VE
RN
ME
NT
AL
FU
ND
S
For
the
Ye
ar
End
ed D
ece
mb
er
31,
2016
Tax
T
ax
Incr
em
en
t In
cre
me
nt
Oth
er
Tot
al
Dis
tric
t #1
De
bt
Dis
tric
t #1
Cap
ital
Gov
ernm
enta
l G
over
nmen
tal
Gen
eral
T
ax
Lev}
:'. S
ervi
ce
Cae
ital
Pro
ject
s .!!
!!12r
ovem
ents
F
unds
F
unds
R
EV
EN
UE
S
Tax
es
$ 6,
164,
001
$ 5,
138,
714
$ 1,
380,
213
$ -
$ -
$ 1,
343,
614
$ 14
,026
,542
O
the
r ta
xes
-9,
477
9,47
7 In
terg
over
nmen
tal
4,86
6,87
8 23
,659
T
40
2,47
0 5,
293,
007
Lice
nses
and
per
mits
54
0,75
6 T
54
0,75
6 F
ines
, fo
rfei
ture
s an
d pe
nalti
es
958,
436
27,8
72
986,
308
Pub
lic c
harg
es f
or s
ervi
ces
149,
722
1,14
5,85
8 1,
295,
580
Inte
rdep
artm
enta
l cha
rges
for
ser
vice
s 33
,219
33
,219
P
ublic
imp
rove
me
nt r
even
ues
4,54
0 51
5,56
5 52
0,10
5 In
vest
men
t in
com
e 67
,556
3,
683
9,67
7 87
0 11
,812
29
,931
12
3,52
9 C
omm
erci
al r
even
ues
14
3,1
27
56
37
6,87
6 52
0,05
9
Tot
al R
even
ues
12,9
23,6
95
5,16
6,05
6 1
,389
,946
5
,410
11
,812
3,
851,
663
23,3
48,5
82
EX
PE
ND
ITU
RE
S
Cur
rent
G
ener
al g
ove
rnm
en
t 2,
853,
679
-2,
853,
679
Pro
tect
ion
of p
erso
ns a
nd p
rope
rty
7,38
3,91
4 -
459,
512
7,84
3,42
6 P
ublic
wor
ks
1,44
3,74
2 -
~
319
28,4
94
39,0
94
1,51
1,64
9 H
ealth
and
san
itatio
n 93
7,32
5 .
. 1,
126,
115
2,06
3,44
0 P
ark
and
recr
eatio
n 23
8,41
5 -
-23
8,41
5 Li
brar
y -
693,
563
693,
563
Con
serv
atio
n an
d d
eve
lop
me
nt
2,18
4,36
5 -
90,5
66
293,
974
2,56
8,90
5 C
apita
l O
utla
y 56
,340
26
,802
18
6,76
3 1,
484,
139
1,66
2,22
6 3,
416,
270
Deb
t S
ervi
ce
Prin
cipa
l ret
irem
ent
11,9
23,4
91
11,9
23,4
91
Inte
rest
and
oth
er c
harg
es
--
1,60
4,26
2 -
1,60
4,26
2
Tot
al E
xpen
ditu
res
12,9
13,4
15
2,2
11,1
67
13,5
27,7
53
277,
648
1,51
2,63
3 4,
274,
484
34,7
17,1
00
Exc
ess
(def
icie
ncy)
of r
even
ues
ove
r ex
pend
iture
s 10
,280
2,
954
,889
(1
2,1
37,8
07)
(272
,238
) (1
,500
,821
) (4
22,8
21)
(11,
368,
518)
OT
HE
R F
INA
NC
ING
SO
UR
CE
S (
US
ES
) Lo
ng-t
erm
de
bt
issu
ed
-8,
475,
000
1,55
0,00
0 1
0,0
25
,00
0
Pre
miu
m o
n lo
ng t
erm
de
bt i
ssue
d 95
,394
95
,394
P
aym
ent t
o re
fund
ing
bond
esc
row
age
nt
(2,5
85,8
24)
(2,5
85,8
24)
Tra
nsfe
rs in
44
7,70
2 5,
863,
847
139,
018
6,45
0,56
7 T
rans
fers
out
(5
,626
,014
) (3
76
,85
1)
(6,0
02,8
65)
Tot
al O
the
r F
inan
cing
Sou
rces
(U
ses)
44
7,70
2 (5
,626
,014
) 11
,848
,417
1,
550,
000
(23
7,8
33
) 7,
982,
272
Net
ch
ang
e in
fu
nd
bal
ance
s 45
7,98
2 (2
,671
,125
) (2
89,3
90)
(272
,238
) 49
,179
(6
60,6
54)
(3,3
86
,24
6)
FU
ND
BA
LAN
CE
S -
Beg
inni
ng o
f Ye
ar
4,42
2,5
99
3,2
95,4
57
5,9
83,1
87
667,
515
3,98
5,65
3 4
,721
,944
23
,076
,355
FU
ND
BA
LA
NC
ES
-E
ND
OF
YE
AR
$
4,88
0,58
1 $
624
,332
$
5,6
93,7
97
$ 39
5,2
77
$ 4,
034,
832
$ 4,
061,
290
$ 1
9,6
90
,10
9
See
acc
ompa
nyin
g no
tes
to f
inan
cial
sta
tem
ents
. P
age
18
A-15
CITY OF CUDAHY
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES For the Year Ended December 31 , 2016
Net change in fund balances - total governmental funds
Amounts reported for governmental activities in the statement of activities are different because:
Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of these assets is capitalized and they are depreciated over their estimated useful lives and reported as depreciation expense in the statement of activities.
Capital outlay is reported as an expenditure in the fund financial statements but is reported in the government-wide financial statements as capital or other assets
Some items reported as capital outlay were not capitalized Depreciation is reported in the government-wide statements Net book value of assets retired
Receivables not currently available are reported as revenue when collected or currently available in the fund financial statements but are rncognized as ;evenue when earned in the government-wide financial statements .
Debt issued provides current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net position. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position.
Debt issued Principal repaid Payments on tax increment revenue bonds
Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds .
Compensated absences Unfunded OPEB liability Accrued interest on debt Net pension liability Deferred outflows related to pensions Deferred inflows related to pensions
Governmental funds report debt premiums and discounts as other financing sources (uses) or expenditures . However, in the statement of net position, these are deferred and reported as other additions or deductions from long-term debt. These are allocated over the period the debt is outstanding in the statement of activities and are reported as interest expense.
Loss on refunding Amortization of loss on refunding Premium on debt issued Amortization of debt premium
Internal service funds are used by management to charge self insurance costs to individual funds.
CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES
See accompanying notes to financial statements.
$ (3,386,246)
$
3,416,270 (872,143)
(2,078,137) (139,547)
227,938
(10,025,000) 14,398,490
13,261
(20,274) (585,934)
6,133 (3,053,599) 4,826,009
(2,535,451)
127,988 (134,360)
(95,394) 77,040
8,596
175,640
Page 19 A-16
CIT
Y O
F C
UD
AH
Y
ST
AT
EM
EN
T O
F N
ET
PO
SIT
ION
P
RO
PR
IET
AR
Y F
UN
DS
A
s o
f De
cem
be
r 31
, 20
16 Bus
ines
s-ty
pe A
ctiv
ities
-G
over
nmen
tal
Ent
erer
ise
Fun
ds
Act
iviti
es -
Wa
ter
Se
we
r S
torm
Wa
ter
Inte
rnal
U
tilit:
t U
tilit:
t U
tilit:
t T
otal
s S
ervi
ce F
und
AS
SE
TS
Cur
rent
Ass
ets
Cas
h an
d in
vest
men
ts
$ 30
4,41
8 $
503,
013
$ 2,
025
,726
$
2,83
3,15
7 $
532,
329
Acc
ount
s re
ceiv
able
83
4,3
79
929,
723
484
,892
2,
248
,994
35
,301
O
the
r re
ceiv
able
s 2
43
25
5 49
8 D
ue f
rom
oth
er f
unds
10
7,73
2 10
9,6
60
58,1
36
27
5,5
28
Mat
eria
ls,
supp
ly in
vent
ory
and
prep
aid
item
s 50
,036
19
5 19
5 50
,426
R
estr
icte
d as
sets
-ca
sh a
nd i
nves
tmen
ts
103,
750
58,7
36
188,
485
350,
971
Tot
al C
urre
nt A
sset
s 1,
400,
315
1,60
1,5
70
2,7
57,6
89
5,75
9,5
74
56
7,63
0
Non
-Cur
rent
Ass
ets
Res
tric
ted
asse
ts
Cas
h an
d in
vest
men
ts
148
,946
4,
486
,806
1,
583
,134
6,
218
,886
T
otal
Res
tric
ted
Ass
ets
148,
946
4,48
6,80
6 1,
583,
134
~2
18
,88
6
Cap
ital
Ass
ets
Pro
pert
y an
d e
qu
ipm
en
t 21
,431
,128
9
,828
,429
18
,676
,251
4
9,9
35,8
08
Less
: A
ccum
ulat
ed d
epre
ciat
ion
(11,
049,
497)
(2
,192
,665
) (3
,282
,216
) (1
6,52
4,37
8)
Con
stru
ctio
n in
pro
gres
s 21
,380
3,
305
24,6
85
Tot
al C
apita
l Ass
ets
, Net
of D
epre
ciat
ion
10,3
81,6
31
7,65
7,1
44
15
,397
,340
33
,436
,115
Inve
stm
ent
in C
ities
and
Vill
ages
Mut
ual
Insu
ranc
e C
om
pa
ny
-72
2,1
70
Tot
al N
on-C
urre
nt A
sset
s 10
,530
,577
12
,143
,950
16
,980
,474
39
,655
,001
72
2,1
70
Tot
al A
sset
s 11
,930
,892
13
,745
,520
19
,738
,16
3
45,4
14,5
75
1,28
9,8
00
DE
FE
RR
ED
OU
TF
LO
WS
OF
RE
SO
UR
CE
S
Una
mor
tized
los
s on
ref
undi
ng
30,5
22
8,19
8 18
9,76
3 22
8,4
83
Def
erre
d ou
tflo
ws
rela
ted
to p
ensi
ons
351,
697
95,6
95
124,
717
572,
109
Tot
al D
efer
red
Out
flow
s o
f Res
ourc
es
382,
219
103,
893
314,
480
800,
592
See
acc
ompa
nyin
g no
tes
to f
inan
cial
sta
tem
ents
. P
age
20
A-17
CIT
Y O
F C
UD
AH
Y
ST
AT
EM
EN
T O
F N
ET
PO
SIT
ION
P
RO
PR
IET
AR
Y F
UN
DS
A
s o
f De
cem
be
r 31
, 2
01
6 Bus
ines
s-ty
pe A
ctiv
ities
-G
over
nmen
tal
Ent
erer
ise
Fun
ds
Act
iviti
es -
Wa
ter
Se
we
r S
torm
Wa
ter
Inte
rnal
U
tiliti
'. U
tiliti
'. U
tiliti
'. T
otal
s S
ervi
ce F
und
LIA
BIL
ITIE
S
Cur
rent
Lia
bilit
ies
Acc
ount
s pa
yabl
e $
145,
472
$ 74
4,21
2 $
24,7
92
$ 91
4,47
6 $
149,
453
Acc
rued
pay
roll
23,3
20
3,61
1 2,
753
29,6
84
Acc
rued
com
pens
ated
abs
ence
s 10
8,37
8 10
8,37
8 A
ccru
ed i
nter
est o
n ge
nera
l obl
igat
ion
de
bt
6,60
9 9,
365
14,3
88
30,3
62
Cur
rent
por
tion
of a
dvan
ce fr
om m
unic
ipal
ity
84,8
03
84,8
03
Cur
rent
por
tion
of g
ener
al o
blig
atio
n d
eb
t 12
6,31
3 12
6,21
2 13
4,05
0 38
6,57
5 C
urre
nt L
iabi
litie
s P
ayab
le fr
om R
estr
icte
d A
sset
s A
ccru
ed i
nter
est o
n re
venu
e bo
nds
4,66
6 20
,816
30
,443
55
,925
C
urre
nt p
ortio
n o
f rev
enue
bon
ds
155,
000
20,0
00
260,
000
435,
000
Tot
al C
urre
nt L
iabi
litie
s 65
4,56
1 92
4,2
16
466,
426
2,04
5,20
3 14
9,45
3
Non
curr
ent
Liab
ilitie
s N
et O
PE
B o
blig
atio
n 1
29
,83
4
12
9,8
34
N
et
pens
ion
liabi
lity
61,6
25
16,8
16
23,0
73
101,
514
Adv
ance
fro
m m
unic
ipal
ity
617,
850
617,
850
Long
-ter
m d
ebt,
ne
t of c
urre
nt m
atu
ritie
s G
ener
al o
blig
atio
n d
eb
t 59
6,13
4 1,
261,
760
1,62
7,03
1 3,
484,
925
Rev
enue
bon
ds p
ayab
le
334,
062
4,14
5,00
0 4,
665,
000
9,14
4,06
2 T
otal
Non
curr
ent
Liab
ilitie
s 1,
739,
505
5,42
3,57
6 6,
315,
104
13
,47
8,18
5
Tot
al L
iabi
litie
s 2,
394,
066
6,34
7,79
2 6,
781
,530
15
,523
,388
14
9,45
3
DE
FE
RR
ED
IN
FLO
WS
OF
RE
SO
UR
CE
S
Def
erre
d in
flow
s re
late
d to
pen
sion
s 12
9,68
9 35
,388
48
,557
2
13
,63
4
Tot
al D
efer
red
Inflo
ws
of R
esou
rces
12
9,68
9 35
,388
48
,557
21
3,63
4
NE
T P
OS
ITIO
N
Ne
t inv
estm
ent
in c
apita
l as
sets
9,
349,
590
6,00
7,2
60
9,98
8,18
2 25
,345
,032
R
estr
icte
d fo
r d
eb
t ser
vice
10
0,90
0 37
,920
15
8,04
2 29
6,86
2 R
estr
icte
d fo
r e
qu
ipm
en
t re
plac
emen
t 59
1,91
5 49
5,97
3 1,
087,
888
Unr
estr
icte
d 33
8,86
6 82
9,13
8 2,
580,
359
3,74
8,36
3 1,
140,
347
TO
TA
L N
ET
PO
SIT
ION
$
9,78
9,35
6 $
7,46
6,2
33
$
13,2
22,5
56
$ 30
,478
,145
$
1,14
0,34
7
See
acc
ompa
nyin
g no
tes
to f
inan
cial
sta
tem
ents
. P
age
21
A-18
CIT
Y O
F C
UD
AH
Y
ST
AT
EM
EN
T O
F R
EV
EN
UE
S,
EX
PE
NS
ES
AN
D
CH
AN
GE
S I
N N
ET
PO
SIT
ION
P
RO
PR
IET
AR
Y F
UN
DS
F
or t
he Y
ear
End
ed D
ecem
ber
31,
2016
Bus
ines
s-ty
pe A
ctiv
ities
-G
over
nmen
tal
Ent
erer
ise
Fun
ds
Act
iviti
es -
Wa
ter
Se
we
r S
torm
Wat
er
Inte
rnal
U
tility
U
tility
U
tility
T
otal
s S
ervi
ce F
und
OP
ER
AT
ING
RE
VE
NU
ES
C
harg
es f
or
serv
ices
and
sal
es
$ 2,
927,
965
$ 3,
180,
211
$ 1,
451
,450
$
7,55
9,62
6 $
Oth
er
oper
atin
g re
venu
es
147
,876
14
7,87
6 38
,000
Tot
al O
pera
ting
Rev
enue
s 3,
07~,
841
_3
, 180
,21_
1_
1,45
1,4
50
____
l,707
,502
~
00
0
OP
ER
AT
ING
EX
PE
NS
ES
O
pera
tion
and
mai
nten
ance
1,
594
,845
2,
452
, 871
44
6,00
1 4
,493
,717
64
,511
D
epre
ciat
ion
516,
971
117
,815
22
4,8
96
859,
682
Tot
al O
pera
ting
Exp
ense
s 2,
111,
816
2,5
70,6
86
670,
897
5,35
3,39
9 64
,511
Ope
ratin
g In
com
e (L
oss)
96
4,0
25
609,
525
780,
553
2,35
4,1
03
(26,
511)
NO
NO
PE
RA
TIN
G R
EV
EN
UE
S (
EX
PE
NS
ES
) In
vest
men
t inc
ome
2,4
26
12,4
29
10,4
55
25
,310
35
,107
M
isce
llane
ous
reve
nue
30,0
00
30,0
00
Am
ortiz
atio
n o
f deb
t pr
emiu
m
442
6,40
0 10
,389
17
,231
In
tere
st e
xpen
se
(44
,562
) (1
75,8
42)
(285
,003
) (5
05,4
07)
Am
ortiz
atio
n o
f los
s on
ref
und
ing
(7,0
43)
(1,8
91)
(5,5
81)
(14,
515)
Tot
al N
onop
erat
ing
Rev
enue
s (E
xpen
ses)
(1
8,7
37)
(158
,904
) (2
69,7
40)
(447
,381
) 35
,107
Inco
me
(Los
s) B
efor
e T
rans
fers
94
§__,2
88
450
,62_
1 51
0,§1
3 _
1,9
06
,722
8,
596
TR
AN
SF
ER
S
Tra
nsfe
rs o
ut
(427
,892
) (1
9,8
10
) -
(44
7,7
02)
Tot
al T
rans
fers
(4
27,8
92)
(19,
810)
-
(447
,702
)
Ch
ang
e in
Net
Po
siti
on
51
7,3
96
430
, 811
51
0,8
13
1,4
59,0
20
8,5
96
NE
T P
OS
ITIO
N -
Beg
inni
ng o
f Yea
r 9,
271,
960
7,03
5,4
22
12,7
1_1_
,74
3 29
,019
,125
_
1_
, 131
,751
NE
T P
OS
ITIO
N -
EN
D O
F Y
EA
R
$ 9,
789
+356
$
7,46
6,23
3 $
1312
22,5
56
$ 30
1478
114
5 $
1,14
0,3
47
See
acc
ompa
nyin
g no
tes
to f
inan
cial
sta
tem
ents
. P
age
22
A-19
CIT
Y O
F C
UD
AH
Y
ST
AT
EM
EN
T O
F C
AS
H F
LO
WS
P
RO
PR
IET
AR
Y F
UN
DS
F
or th
e Y
ea
r E
nded
De
cem
be
r 31
, 20
16
Bus
ines
s-ty
pe A
ctiv
ities
-E
nter
eris
e F
unds
Wa
ter
Sew
er
Sto
rm W
ate
r
Uti
lity
__
U
tility
U
tility
CA
SH
FL
OW
S F
RO
M O
PE
RA
TIN
G A
CT
IVIT
IES
C
ash
rece
ived
fro
m c
usto
mer
s $
2,97
2,11
6 $
3,13
6,51
1 $
1,42
4,18
6 C
ash
rece
ived
fro
m (
paid
to)
city
51
,279
(5
1,27
9)
Cas
h pa
id t
o su
pplie
rs fo
r go
ods
and
serv
ices
(8
81,5
40)
(2,0
99,6
64)
(244
,955
) C
ash
paym
ents
to e
mpl
oyee
s fo
r se
rvic
es
(542
,424
) (1
58,6
00)
(194
,908
)
Net
Cas
h F
low
s F
rom
Ope
ratin
g A
ctiv
ities
1,
599,
431
826,
968
984,
323
CA
SH
FL
OW
S F
RO
M N
ON
CA
PIT
AL
FIN
AN
CIN
G A
CT
IVIT
IES
C
ash
paym
ents
fro
m (
to)
city
(4
27,8
92)
(19,
810)
A
dvan
ces
(to)
from
oth
er fu
nds
(83,
964)
Net
Cas
h F
low
s F
rom
Non
-cap
ital
Fin
anci
ng A
ctiv
ities
(5
11,8
56)
(19,
810)
CA
SH
FL
OW
S F
RO
M C
AP
ITA
L A
ND
RE
LA
TE
D
FIN
AN
CIN
G A
CT
IVIT
IES
A
cqui
sitio
n an
d co
nstr
uctio
n o
f cap
ital
asse
ts
(735
,596
) (4
43,0
20)
(347
,587
) Lo
ng-t
erm
de
bt i
ssue
d 56
0,00
0 23
0,00
0 2,
790,
000
Pay
men
ts to
esc
row
dur
ing
refu
ndin
g (2
,840
,344
) P
rinci
pal
paid
on
de
bt
(896
,933
) (3
88,8
21)
(365
,756
) D
ebt
issu
ance
cos
ts
(3,4
35)
(103
,345
) P
rem
ium
on
de
bt
issu
ed
1,69
8 70
1 74
,948
In
tere
st p
aid
on d
eb
t (4
8,48
8)
(172
,407
) (1
86,3
01)
Ne
t Cas
h F
low
s F
rom
Cap
ftal
and
Rel
ated
Fin
anci
ng A
ctiv
ities
(1
,119
,319
) (7
76,9
82)
(978
,385
)
CA
SH
FL
OW
S F
RO
M I
NV
ES
TIN
G A
CT
IVIT
IES
In
vest
men
t in
com
e 2,
426
12,2
84
10,4
84
Net
Cas
h F
low
s F
rom
Inv
estin
g A
ctiv
ities
2,
426
12,2
84
10,4
84
Net
Ch
ang
e in
Cas
h a
nd
Cas
h E
qu
ival
ents
(2
9,31
8)
42,4
60
16,4
22
CA
SH
AN
D C
AS
H E
QU
IVA
LEN
TS
-B
egin
ning
of Y
ea
r 58
6,43
2 _ 5
,006
,095
3,
780,
923
CA
SH
AN
D C
AS
H E
QU
IVA
LE
NT
S -
EN
D O
F Y
EA
R
$ 55
7,11
4 ,$
5,
048,
555
$ 3,
797,
345
See
acc
ompa
nyin
g no
tes
to f
inan
cial
sta
tem
ents
.
Gov
ernm
enta
l A
ctiv
ities
-
Inte
rnal
Tot
al
Ser
vice
Fun
d
$ 7,
532,
813
$ 37
,673
(3
,226
,159
) (6
4,51
2)
(895
,932
) 3,
410,
722
(26,
839)
(447
,702
) (8
3,96
4)
(531
,666
)
(1,5
26,2
03)
3,58
0,00
0 (2
,840
,344
) (1
,651
,510
) (1
06,7
80)
77,3
47
(407
,196
)
(2,8
74,6
86)
25,1
94
35,1
07
25,1
94
35,1
07
29,5
64
8,26
8
9,37
3,45
0 52
4,06
1
$ 9,
403,
014
$ 53
2,32
9
Pag
e 23
A-20
CIT
Y O
F C
UD
AH
Y
ST
AT
EM
EN
T O
F C
AS
H F
LO
WS
P
RO
PR
IET
AR
Y F
UN
DS
F
or
the
Ye
ar
End
ed D
ece
mb
er
31,
2016
CA
SH
AN
D C
AS
H E
QU
IVA
LE
NT
S -
ST
AT
EM
EN
T O
F N
ET
PO
SIT
ION
U
nres
tric
ted
Res
tric
ted
-cu
rren
t R
estr
icte
d -
non-
curr
ent
RE
CO
NC
ILIA
TIO
N O
F O
PE
RA
TIN
G I
NC
OM
E (
LO
SS
) T
O
NE
T C
AS
H F
LO
WS
FR
OM
OP
ER
AT
ING
AC
TIV
ITIE
S
Ope
ratin
g in
com
e (lo
ss)
Adj
ustm
ents
to R
econ
cile
Ope
ratin
g In
com
e (L
oss)
to
Net
Cas
h F
low
s F
rom
Ope
ratin
g A
ctiv
ities
D
epre
ciat
ion
Dep
reci
atio
n ch
arge
d to
oth
er
acco
unts
N
on-o
pera
ting
inco
me
Cha
nge
in A
sset
s, D
efer
red
Out
flow
s, L
iabi
litie
s, a
nd
Def
erre
d In
flow
s A
ccou
nts
rece
ivab
le
Mat
eria
ls,
supp
lies
inve
ntor
y an
d pr
epai
d ite
ms
Acc
ount
s pa
yabl
e A
ccru
ed e
xpen
ses
Net
OP
EB
obl
igat
ion
Pen
sion
rel
ated
def
erra
ls a
nd l
iabi
litie
s
NE
T C
AS
H F
LO
WS
FR
OM
OP
ER
AT
ING
AC
TIV
ITIE
S
NO
N-C
AS
H I
NV
ES
TIN
G,
CA
PIT
AL
AN
D F
INA
NC
ING
AC
TIV
ITIE
S
Bon
d pr
ocee
ds u
sed
in r
efun
ding
of d
eb
t
Loss
on
refu
ndin
g A
mor
tizat
ion
of
prem
ium
A
mor
tizat
ion
of
loss
on
adva
nce
refu
ndin
g
$ $ $
Bus
ines
s-ty
pe A
ctiv
ities
-E
nter
.e_r
ise
Fun
ds
Gov
ernm
enta
l A
ctiv
ities
-
Inte
rnal
S
ervi
ce F
und
Wa
ter
Util
ity
Se
we
r
Util
ity
304,
418
$ 10
3,75
0 14
8,94
6
557,
114
503
,013
58
,736
4,
486,
806
$ 5,
048,
555
Sto
rm W
ate
r
Util
ity
Tot
al
$ 2,
025,
726
$ 2
,833
,157
$
188,
485
350,
971
1,58
3,13
4 6,
218,
886
532,
329
$ 3,
797,
345
$ 9,
403,
014
$ 53
2,32
9
964,
025
$ 60
9,52
5 $
780
,553
$
2,35
4,10
3 $
(26
,511
)
516,
971
117,
815
224,
896
859,
682
51,2
79
51,2
79
30,0
00
-30
,000
(133
,725
) (4
3,70
0)
(27,
264)
(2
04,6
89)
(327
) 11
,472
(1
95)
2,20
5 13
,482
11
2,94
3 13
5,28
6 70
5 2
48
,93
4
(1)
(6,5
34)
17
(3,8
07)
(10,
324)
5,
755
5,75
5 47
,245
8,
220
7,03
5 62
,500
-
$ 1,
599,
431
$ 82
6,96
13_
L_
j)8
4,3
23
$
3,41
0,72
2 $
(26,
839)
$ -
$ -
$ 2,
645,
000
$ 2,
645,
000
i $
-$
-$
195,
344
$ 19
5,34
4 1
$ 42
2 $
6,40
0 $
10,3
89
$ 17
,211
i
-$
(7,0
43)
$ (1
,891
) $
(5,5
81)
$ (1
4,51
5)
$
See
acc
ompa
nyin
g no
tes
to f
inan
cial
sta
tem
ents
. P
age
24
A-21
ASSETS Cash and investments Taxes receivable
Total Assets
LIABILITIES
CITY OF CUDAHY
ST AT EM ENT OF ASSETS AND LIABILITES AGENCY FUND
As of December 31, 2016
Due to other taxing units
See accompanying notes to financial statements.
Tax Roll Agenc:i:: Fund
$ 17,729,061 649,236
$ 18,378,297
$ 18,378,297
Page 25 A-22
A-23
A-24
A-25
A-26
A-27
A-28
A-29
A-30
A-31
A-32
A-33
A-34
A-35
A-36
A-37
A-38
A-39
A-40
A-41
A-42
A-43
A-44
A-45
A-46
A-47
A-48
A-49
CIT
Y O
F C
UD
AH
Y
CO
MB
ININ
G B
AL
AN
CE
SH
EE
T
NO
NM
AJO
R G
OV
ER
NM
EN
TA
L F
UN
DS
A
s o
f D
ece
mb
er
31,
20
16
seec
'ial
Re
ven
ue
Fu
nd
s
En
viro
nm
en
tal
He
alth
S
pe
cia
l S
pe
c1al
T
ax
Incr
em
en
tal
Lib
rary
A
mb
ula
nce
G
ran
t G
ran
t R
ecyc
ling
Co
llect
ion
s A
sse
ssm
en
t D
istr
ict
Fu
nd
F
und
Fun
d F
und ~
Fun
d F
und
Fun
d #1
AS
SE
TS
C
ash
and
in
vest
me
nts
$
47
4,9
14
$
11
9,8
26
$
$ 4
,383
$
15
8,0
98
$
12
2,1
56
$
1,2
16
,385
$
570,
021
Acc
ou
nts
re
ceiv
ab
le (
ne
t o
f a
llow
an
ce f
or
un
colle
ctib
les
of
$3
4,4
27
) 11
,25
4
46,0
21
10,
377
17,7
54
2
,53
8
3,1
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axe
s re
ceiv
ab
le
68
5,9
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4
13
,88
6
22
2,3
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2
20
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7
21
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09
S
pe
cia
l a
sse
ssm
en
ts r
ecei
vab
le -
du
e in
mo
re
tha
n o
ne y
ea
r 35
9,1
55
A
dva
nce
to
oth
er
fun
ds
10
0,0
00
R
est
rict
ed
cas
h an
d in
vest
me
nts
5
41
,70
9
Pre
pa
id i
tem
s 23
6 19
5
To
tal
Ass
ets
$
1,7
141
09
3
L..
1.2
§,,8
47
$ 1
0,3
77
$ 2
2,1
37
L_5
Z4
,717
$
34
7,7
16
$
1,7
96
,48
7
$ 8
80
,03
0
LIA
BIL
ITIE
S
Acc
ou
nts
pay
able
3
4,3
73
1
,07
4
3,6
81
35
,83
7
Acc
rue
d l
iabi
litie
s 6
,64
8
5,9
66
2
,01
8
12
,64
2
Due
to
oth
er
fun
ds
22
,613
Ad
van
ce f
rom
oth
er
fund
s -----
Tot
al L
iabl
lffie
s 41
,021
_
_ 7,0
40
2
2,6
13
___
___M§
__1_
____
_]J_
_,_~
5 _
_ 1_2,6
42
DE
FE
RR
ED
IN
FL
OW
S O
F R
ES
OU
RC
ES
U
ne
arn
ed
re
ven
ue
s 6
85
,98
0
5,7
34
4
13
,88
6
22
2,3
90
2
70
2
10
,00
9
Un
ava
ilab
le r
eve
nu
es
580,
101
Tot
al D
efe
rre
d I
nflo
ws
of
Re
sou
rce
s ~
98
0
5,7
34
-
-4
13
,886
22
2,3
90
__
___f
ill()
,371
2
10
,00
9
FU
ND
BA
LA
NC
ES
N
on
spe
nd
ab
le
10
0,2
36
19
5
Re
stric
ted
80
7,4
29
67
0,02
1
Co
mm
nte
d 7
9,4
27
15
8,8
07
1
2,7
22
12
2,78
1 1
25
,32
6
1,2
03
.47
4
Ass
ign
ed
Un
ass
ign
ed
(1
2,2
36
)
Tot
al F
un
d B
ala
nce
(D
efic
it)
98
7,0
92
15
8,8
07
(1
2,2
36
) 12
,722
12
2,9
76
~
32
6 ~
47
4
67
0.0
21
TO
TA
L L
IAB
ILIT
IES
, D
EF
ER
RE
D
INF
LO
WS
OF
RE
SO
UR
CE
S,
AN
D F
UN
D B
AL
AN
CE
S
$ 1
,71
4,0
93
$ 1
65
,847
$
10,3
77
$ 2
2,1
37
$
57
4,7
17
$ 3
47
,716
$
1,79
6,4
87
$
88
0,0
30
Pa
ge
77
A-50
CIT
Y O
F C
UD
AH
Y
CO
MB
ININ
G B
AL
AN
CE
SH
EE
T
NO
N M
AJO
R G
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ER
NM
EN
T A
L F
UN
DS
A
s o
f D
ece
mb
er
31,
2016
See
cial
Rev
enue
Fun
ds
Cae
1tal
Pro
ject
s F
unds
Env
iron
men
tal
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tal
Com
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ity
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d &
T
otal
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ax
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tal
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el &
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el
Pro
pert
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evel
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ipm
ent
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maj
or
Dis
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-9
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x In
spec
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G
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Fun
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F
und
Fun
d F
und
Fun
d F
und
Fun
ds
AS
SE
TS
C
ash
and
inve
stm
ents
$
$ 1,
364
$ 4,
921
$ 11
7,72
2 $
740,
691
$ 13
2,5
68
$ 3,
663,
049
Acc
ount
s re
ceiv
able
(ne
t o
f allo
wan
ce f
or
unco
llect
ible
s o
f $34
,427
) 1,
947
25,6
25
4,44
8 55
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3,18
9 T
axe
s re
ceiv
able
31
,461
4
50,0
00
2,23
4,67
3 S
peci
al a
sses
smen
ts r
ecei
vabl
e -
due
in m
ore
than
one
yea
r 35
9,15
5 A
dvan
ce t
o ot
her
fund
s 10
0,00
0 R
estr
icte
d ca
sh a
nd i
nves
tmen
ts
363,
675
90
5,3
84
Pre
paid
ite
ms
1,79
3 2,
224
Tot
al A
sset
s $
395
,136
$
1,36
4 $
8,6
61_
$
143
,347
$
745
.139
$
58?;
.623
$
7,3
87,6
74
LIA
BIL
ITIE
S
Acc
ount
s pa
yabl
e 55
,484
75
0 1,
681
1,2
45
13
4,12
5 A
ccru
ed l
iabi
litie
s 1,
543
28,8
17
Due
to
othe
r fu
nds
440
,998
46
3,61
1
Adv
ance
fro
m o
ther
fund
s 10
0,00
0 10
0,0
00
Tot
al L
iabi
litie
s 59
6,48
2 75
0 1,
681
1,5
43
1,
245
726_
,553
DE
FE
RR
ED
IN
FL
OW
S O
F R
ES
OU
RC
ES
U
near
ned
reve
nues
31
,461
45
0,00
0 2,
019,
730
Una
vaila
ble
reve
nues
58
0,10
1
Tot
al D
efer
red
Inflo
ws
of
Res
ourc
es
31,4
61
450,
000
_ _1
_,59
9,83
1
FU
ND
BA
LA
NC
ES
N
onsp
enda
ble
1,79
3 10
2,2
24
Res
tric
ted
363,
675
745,
139
2,58
6,26
4
Com
mitt
ed
614
5,18
7 14
1,8
04
1,
850,
142
Ass
igne
d 13
1,37
8 13
1,37
8
Una
ssig
ned
(596
,482
) (6
08,7
18)
Tot
al F
und
Bal
ance
(D
efic
it)
(232
,807
) 61
4 6
,980
14
1,8
04
745
,139
--
131
,378
4,
061,
290
TO
TA
L L
IAB
ILIT
IES
, D
EF
ER
RE
D
INF
LO
WS
OF
RE
SO
UR
CE
S,
AN
D F
UN
D B
AL
AN
CE
S
$ 39
5,1
36
$ 1
,36
4
$ 8,
661
$ 14
3,34
7 $
745
,139
$
582
,62
~
$ 7,
387
,674
Pag
e 78
A-51
CIT
Y O
F C
UD
AH
Y
CO
MB
ININ
G S
TA
TE
ME
NT
OF
RE
VE
NU
ES
, E
XP
EN
DIT
UR
ES
AN
D C
HA
NG
ES
IN
FU
ND
BA
LA
NC
ES
N
ON
MA
JOR
GO
VE
RN
ME
NT
AL
FU
ND
S
For
the
Ye
ar
End
ed D
ece
mb
er
31,
2016
see
cia
l R
even
ue F
unds
Env
iron
men
tal
Hea
lth
Spe
cial
S
peci
al
Ta
x In
crem
enta
l Li
brar
y A
mbu
lanc
e G
rant
G
ran
t R
ecyc
ling
Col
lect
ions
A
sse
ssm
en
t D
istr
ict
Fun
d F
und
Fun
d F
und
Fun
d F
und
Fun
d F
und
#1
RE
VE
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ES
T
axes
$
647
,560
$
-$
-$
-$
-$
-$
-$
275
,16
3
Oth
er
taxe
s In
terg
over
nmen
tal
149,
246
29,4
17
69,2
78
80,7
13
63,4
77
Fin
es,
forf
eitu
res
and
pena
lties
27
,872
P
ublic
cha
rges
for
ser
vice
s 36
,164
30
3,41
4 42
3,93
3 24
8,26
0 P
ublic
imp
rove
me
nt r
even
ue
515,
565
Inve
stm
ent i
ncom
e 2,
188
259
4,06
6 2
,013
17
,218
1,
416
Com
mer
cial
rev
enue
s 36
8,34
6 88
7 2
,129
1
,237
Tot
al R
even
ues
1,23
1.3
76
333,
.977
6
9.2
78
80
,713
4
93
,605
25
1,51
0 ~
~.7
83
27
6,57
9
EX
PE
ND
ITU
RE
S
Cur
rent
P
rote
ctio
n o
f per
sons
and
pro
pert
y 33
6,75
6 P
ublic
wor
ks
39,0
94
Hea
lth a
nd s
anita
tion
83,0
14
705,
479
337,
622
Libr
ary
693,
563
Con
serv
atio
n an
d d
eve
lop
me
nt
8,10
8 C
apita
l O
utla
y 40
5,99
5 7,
341
69,2
78
-57
0,63
4 T
otal
Exp
endi
ture
s 1,
099,
558
344,
097
69,2
78
83,0
14
705,
479
337,
622
609,
728
8,10
8
Exc
ess
(def
icie
ncy)
of r
even
ues
ove
r ex
pend
iture
s 13
1,81
8 (1
0,12
0)
(2,3
01)
(211
,874
) (8
6,11
2)
(76,
945)
26
8,47
1
OT
HE
R F
INA
NC
ING
SO
UR
CE
S (
US
ES
) T
rans
fers
in
Tra
nsfe
rs o
ut
-(2
74
,881
) T
otal
Oth
er
Fin
anci
ng S
ourc
es (
Use
s)
(27
4,8
81)
Net
ch
ang
e in
fu
nd
bal
ance
s 13
1,81
8 (1
0,12
0)
(2,3
01)
(211
,874
) (8
6,11
2)
(76,
945)
(6
,410
)
FUN
D B
ALA
NC
ES
(D
EF
ICIT
) -
Beg
inni
ng o
f Ye
ar
855,
274
168,
927
(12,
236)
15
,023
33
4,85
0 21
1,43
8 1
,280
,419
67
6,43
1
FU
ND
BA
LA
NC
ES
(D
EF
ICIT
) -
EN
D O
F Y
EA
R
$ 98
7,0
92
$ 1
581
807
$ (1
2,23
6)
$ 12
,722
$
122,
976
$ 12
5,32
6 $
1,20
3,47
4 $
670,
021 Pag
e 79
A-52
CIT
Y O
F C
UD
AH
Y
CO
MB
ININ
G S
TA
TE
ME
NT
OF
RE
VE
NU
ES
, EX
PE
ND
ITU
RE
S A
ND
CH
AN
GE
S I
N F
UN
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AL
AN
CE
S
NO
NM
AJO
R G
OV
ER
NM
EN
TA
L F
UN
DS
F
or
the
Ye
ar
En
de
d D
ece
mb
er
31,
20
16
S11
ecia
l Re
ven
ue
Fu
nd
s C
a11i
tal P
roje
cts
Fu
nd
s
En
viro
nm
en
tal
Ren
tal
Co
mm
un
ity
Ro
ad
&
To
tal
Ta
x In
cre
me
nta
l H
otel
& M
otel
P
rop
ert
y D
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lop
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nt
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me
nt
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ajo
r D
istr
ict
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T
ax
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ect
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A
uth
ori
ty
Imp
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nts
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ove
rnm
en
tal
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un
d
Fu
nd
F
un
d
Fun
d F
und
Fu
nd
s
RE
VE
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ES
T
axe
s $
20,8
91
$ ~
$ -
$ -
$ -
$ 4
00
,00
0
$ 1
,34
3,6
14
O
the
r ta
xes
9,4
77
9
,47
7
Inte
rgo
vern
me
nta
l 1
0,3
39
4
02
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0
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es,
forf
eitu
res
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d p
enal
ties
27
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2
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blic
ch
arg
es
for
serv
ice
s 1
34,
08
7
-1
,14
5,8
58
P
ub
lic im
pro
vem
en
t re
ven
ue
5
15
,565
In
vest
me
nt i
nco
me
22
7
1,5
89
1
,15
3
29
,931
C
om
me
rcia
l re
ven
ue
s 4
,27
7
37
6,8
76
To
tal
Re
ven
ue
s 2
0,9
13
4
,28
4
9,4
77
1
34,
08
7
1.5
89
_
41
1,4
92
3
,85
1,6
63
EX
PE
ND
ITU
RE
S
Cu
rre
nt
Pro
tect
ion
of p
ers
on
s an
d p
rop
ert
y 5
,20
6
11
7,55
0 -
45
9,5
12
P
ub
lic w
ork
s -
39
,09
4
He
alth
and
sa
nita
tion
-
-1
,12
6,1
15
L
ibra
ry
-6
93
,56
3
Co
nse
rva
tion
and
de
velo
pm
en
t 2
64
,74
3
21,1
23
2
93
,97
4
Cap
ital
Ou
tlay
60
8,9
78
1,
662.
,226
To
tal
Exp
en
ditu
res
--
____
__1§
1_, 7
43
5,
206
21
_j2
3
_ _1
_17
,55
0
60
8,9
78
__
____
_1,_g
_7 4
,48
4
Exc
ess
(d
efic
ien
cy)
of r
eve
nu
es
ove
r e
xpe
nd
iture
s (2
43
,83
0)
(92
2)
(11
,6§
) 1
6,5
37
1
,58
9
(19
7,4
86
) (4
22a
ll21
)
OT
HE
R F
INA
NC
ING
SO
UR
CE
S (
US
ES
) T
ran
sfe
rs in
1
39
,01
8
-1
39
,01
8
Tra
nsf
ers
ou
t (1
01
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0)
-(3
76
,85
1)
Tot
al O
the
r F
inan
cing
So
urc
es
(Use
s)
37
,04
8
(23
7,8
33
)
Ne
t ch
an
ge
in f
und
ba
lan
ces
(20
6,7
82
) (9
22
) (1
1,6
46
) 1
6,5
37
1
,58
9
(19
7,4
86
) (6
60
,65
4)
FU
ND
BA
LA
NC
ES
(D
EF
ICIT
) -
Beg
inni
ng o
f Ye
ar
(26
,02
5)
____
_j_,
§3§_
_
_ 18.
62
6
12
5,2
67
7
43
,55
0
32
8,8
64
4
,72
1,9
44
FU
ND
BA
LA
NC
ES
(D
EF
ICIT
) -
EN
D O
F Y
EA
R
$ (2
32
,80
7)
$ 6
14
$
6,9
80
$
14
1,8
04
$
745:
13
9
!_ _
_131
,378
L
4
,06
1,2
90
Pa
ge
80
A-53
APPENDIX B
FORM OF LEGAL OPINION
(See following pages)
B-1
MIL-29062309-1
March 7, 2018
$7,215,000* City of Cudahy
Milwaukee County, Wisconsin General Obligation Corporate Purpose Bonds, Series 2018B
We have acted as bond counsel in connection with the issuance by the City of Cudahy, Milwaukee County, Wisconsin (the “City”), of its $7,215,000 General Obligation Corporate Purpose Bonds, Series 2018B, dated March 7, 2018 (the “Bonds”). We have examined the law and a certified copy of the proceedings of record of the City preliminary to and in connection with the issuance of the Bonds, as well as other documents and records which we have deemed necessary to render this opinion.
As to questions of fact material to our opinion, we have relied upon the certified proceedings and other certificates of officers of the City and other public officials furnished to us, without undertaking to verify the same by independent investigation. The rights of the owners of the Bonds and the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights heretofore or hereafter enacted and that their enforcement may be subject to the exercise of judicial discretion in accordance with general principles of equity.
Based on the foregoing, we are of the opinion and hereby certify that, as of the date hereof:
1. The Bonds are valid and binding general obligations of the City, payable from anonrepealable, direct annual tax levied upon all the taxable property of the City for the express purpose of paying interest on the Bonds as it falls due and also to pay and discharge the principal thereof at maturity.
2. The interest on the Bonds is excluded from gross income for federal income taxpurposes and is not an item of tax preference under Section 57 of the Internal Revenue Code of 1986, as amended (the “Code”), for purposes of the federal alternative minimum tax; such interest is, however, included in adjusted current earnings of certain corporations for purposes of computing federal alternative minimum tax in effect prior to January 1, 2018 for tax years beginning before such date. The Code contains requirements that must be satisfied subsequent to the issuance of the Bonds in order for interest on the Bonds to be or continue to be excluded from gross income for federal
* Preliminary; subject to change
B-2
March 7, 2018
Page 2
MIL-29062309-1
income tax purposes. Failure to comply with certain of those requirements could cause the interest on the Bonds to be included in gross income retroactively to the date of issuance of the Bonds. The City has agreed to comply with all of those requirements. The opinion set forth in the first sentence of this paragraph is subject to the condition that the City comply with those requirements. We express no opinion regarding other federal tax consequences arising with respect to the Bonds.
3. The City has properly designated the Bonds as “qualified tax-exempt obligations” under Section 265 of the Code.
Very truly yours,
HUSCH BLACKWELL LLP
B-3
APPENDIX C
BOOK-ENTRY-ONLY SYSTEM
1. The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for the securities(the "Securities"). The Securities will be issued as fully-registered securities registered in the name of Cede & Co.(DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. Onefully-registered Security certificate will be issued for [each issue of] the Securities, [each] in the aggregate principalamount of such issue, and will be deposited with DTC. [If, however, the aggregate principal amount of [any] issueexceeds $500 million, one certificate will be issued with respect to each $500 million of principal amount, and anadditional certificate will be issued with respect to any remaining principal amount of such issue.]
2. DTC, the world's largest securities depository, is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of theFederal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code,and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues,corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC'sparticipants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among DirectParticipants of sales and other securities transactions in deposited securities, through electronic computerizedbook-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physicalmovement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers anddealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-ownedsubsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC,National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registeredclearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is alsoavailable to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, andclearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directlyor indirectly ("Indirect Participants"). DTC has a Standard & Poor's rating of AA+. The DTC Rules applicableto its Participants are on file with the Securities and Exchange Commission. More information about DTC can befound at www.dtcc.com.
3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive
a credit for the Securities on DTC's records. The ownership interest of each actual purchaser of each Security("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Ownerswill not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected toreceive written confirmations providing details of the transaction, as well as periodic statements of their holdings,from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfersof ownership interests in the Securities are to be accomplished by entries made on the books of Direct and IndirectParticipants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing theirownership interests in Securities, except in the event that use of the book-entry system for the Securities isdiscontinued.
4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the
name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorizedrepresentative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. orsuch other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actualBeneficial Owners of the Securities; DTC's records reflect only the identity of the Direct Participants to whoseaccounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and IndirectParticipants will remain responsible for keeping account of their holdings on behalf of their customers.
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5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to IndirectParticipants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed byarrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. [Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices ofsignificant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendmentsto the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nomineeholding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In thealternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request thatcopies of notices be provided directly to them.]
6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed,
DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to beredeemed.
7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless
authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTCmails an Omnibus Proxy to City as soon as possible after the record date. The Omnibus Proxy assigns Cede &Co.'s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the recorddate (identified in a listing attached to the Omnibus Proxy).
8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such
other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit DirectParticipants' accounts upon DTC's receipt of funds and corresponding detail information from the City or Agent,on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participantsto Beneficial Owners will be governed by standing instructions and customary practices, as is the case withsecurities held for the accounts of customers in bearer form or registered in "street name," and will be theresponsibility of such Participant and not of DTC, Agent, or the City, subject to any statutory or regulatoryrequirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividendpayments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) isthe responsibility of the City or Agent, disbursement of such payments to Direct Participants will be theresponsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility ofDirect and Indirect Participants.
9. A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant,
to [Tender/Remarketing] Agent, and shall effect delivery of such Securities by causing the Direct Participant totransfer the Participant's interest in the Securities, on DTC's records, to [Tender/Remarketing] Agent. Therequirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase willbe deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC'srecords and followed by a book-entry credit of tendered Securities to [Tender/Remarketing] Agent's DTC account.
10. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving
reasonable notice to the City or Agent. Under such circumstances, in the event that a successor depository is notobtained, Security certificates are required to be printed and delivered.
11. The City may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor
securities depository). In that event, Security certificates will be printed and delivered to DTC. 12. The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that
the City believes to be reliable, but the City takes no responsibility for the accuracy thereof.
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APPENDIX D
FORM OF CONTINUING DISCLOSURE AGREEMENT
(See following pages)
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MIL-29053826-1
$7,215,000* City of Cudahy
Milwaukee County, Wisconsin General Obligation Corporate Purpose Bonds, Series 2018B
CONTINUING DISCLOSURE AGREEMENT
This Continuing Disclosure Agreement (the “Continuing Disclosure Agreement”) is executed and delivered by the City of Cudahy, Milwaukee County, Wisconsin (the “City”), in connection with the issuance of $7,215,000 General Obligation Corporate Purpose Bonds, Series 2018B (the “Bonds”). The Bonds are being issued pursuant to the resolutions adopted by the Common Council on January 16, 2018 and February 21, 2018 (the “Resolutions”). The City covenants and agrees as follows:
Section 1. Purpose of Continuing Disclosure Agreement. This Continuing Disclosure Agreement is being executed and delivered by the City for the benefit of the Bondholders and in order to assist the Participating Underwriters in complying with SEC Rule 15c2-12(b)(5).
Section 2. Definitions. In addition to the definitions set forth in the Resolutions which apply to any capitalized term used in this Continuing Disclosure Agreement unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:
“Annual Report” shall mean any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Continuing Disclosure Agreement.
“Audited Financial Statements” shall mean the City’s annual financial statements, which are currently prepared in accordance with generally accepted accounting principles (GAAP) for governmental units as prescribed by the Governmental Accounting Standards Board (GASB) and which the City intends to continue to prepare in substantially the same form.
“Bondholder” shall mean the registered owner or beneficial owner of any of the Bonds.
“City Contact” shall mean the Clerk of the City, 5050 South Lake Drive, Cudahy, Wisconsin 53110.
“Dissemination Agent” shall mean any Dissemination Agent designated in writing by the City which has filed with the City a written acceptance of such designation.
“Fiscal Year” shall mean the fiscal year of the City, currently ending on December 31 of each year.
* Preliminary; subject to change
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“Listed Events” shall mean any of the events listed in Section 5(a) of this Continuing Disclosure Agreement.
“MSRB” shall mean the Municipal Securities Rulemaking Board located at 1300 I Street NW, Suite 1000, Washington, DC 20005.
“National Repository” shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. The sole National Repository is the MSRB, through the operation of EMMA, as provided in Section 3(e) hereof.
“Official Statement” shall mean the final official statement dated February _____, 2018 delivered in connection with the Bonds, which is available from the MSRB.
“Participating Underwriter” shall mean the original underwriter of the Bonds required to comply with the Rule in connection with offering of the Bonds.
“Repository” shall mean each National Repository and each State Repository.
“Rule” shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time.
“State Repository” shall mean any public or private repository or entity designated by the State as a state repository for the purpose of the Rule. As of the date of this Continuing Disclosure Agreement, there is no State Repository.
Section 3. Provision of Annual Reports.
(a) The City shall, or shall cause the Dissemination Agent to, not later than 365 days after the end of the City’s Fiscal Year in each year, commencing with the Fiscal Year ending December 31, 2017 provide to each Repository an Annual Report which is consistent with the requirements of Section 4 of this Continuing Disclosure Agreement. Not later than fifteen (15) business days prior to said date, the City shall provide the Annual Report to the Dissemination Agent, if any. In each case, the Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 4 of this Continuing Disclosure Agreement; provided that the Audited Financial Statements of the City may be submitted separately from the balance of the Annual Report and that, if Audited Financial Statements are not available within 365 days after the end of the Fiscal Year, unaudited financial information will be provided, and Audited Financial Statements will be submitted to each Repository as soon as received by the City.
(b) If the City is unable or fails to provide an Annual Report to the Repositories by the date required above, the City shall, in a timely manner, send a notice of that fact to the National Repositories, the MSRB and any State Repository.
(c) The City shall determine each year prior to the date for providing the Annual Report, the name and address of each National Repository and each State Repository, if any.
(d) The Dissemination Agent, if any, shall:
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(1) determine each year prior to the date for providing the Annual Report the name and address of each National Repository and each State Repository, if any; and
(2) file a report with the City certifying that the Annual Report has been provided pursuant to this Continuing Disclosure Agreement, stating the date it was provided, and listing all the Repositories to which it was provided.
(e) The Securities and Exchange Commission has approved the submission of continuing disclosure filings with the Electronic Municipal Market Access (“EMMA”) system established by the MSRB until EMMA shall no longer be the sole National Repository recognized by the Securities and Exchange Commission for purposes of the Rule. All continuing disclosure filings under this Continuing Disclosure Agreement may thereafter be filed solely by transmitting such filings to EMMA at www.emma.msrb.org.
Section 4. Content of Annual Reports. The City’s Annual Report shall contain or incorporate by reference the Audited Financial Statements of the City and updates of the following sections of the Official Statement to the extent such financial information and operating data are not included in the Audited Financial Statements:
Current Property Valuations Direct Debt Debt Limit Tax Levies and Collections
Any or all of the items listed above may be incorporated by reference from other documents, including official statements of debt issues with respect to which the City is an “obligated person” (as defined by the Rule), which have been filed with each of the Repositories or the Securities and Exchange Commission. If the document incorporated by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The City shall clearly identify each such other document so incorporated by reference.
Section 5. Reporting of Significant Events.
(a) This Section 5 shall govern the giving of notices of the occurrence of any of the following events:
(1) Principal and interest payment delinquencies;
(2) Nonpayment related defaults, if material; (3) Unscheduled draws on debt service reserves reflecting financial difficulties; (4) Unscheduled draws on credit enhancements reflecting financial difficulties; (5) Substitution of credit or liquidity providers, or their failure to perform; (6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material
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notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; (7) Modifications to the rights of holders of the Bonds, if material; (8) Bond calls, if material, and tender offers; (9) Defeasances; (10) Release, substitution or sale of property securing repayment of the Bonds, if material; (11) Rating changes; (12) Bankruptcy, insolvency, receivership or similar event of the City; (13) The consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to such actions, other than pursuant to its terms, if material; and (14) Appointment of a successor or additional trustee, or the change of the name of a trustee, if material. (b) The City shall file a notice of the occurrence of any of the Listed Events in a timely manner not in excess of ten business days after the occurrence of the event with the MSRB in an electronic format as prescribed by the MSRB and accompanied by identifying information as prescribed by the MSRB.
Section 6. Termination of Reporting Obligation. The City’s obligations under this Continuing Disclosure Agreement shall terminate upon the defeasance, prior redemption or payment in full of all of the Bonds.
Section 7. City Contact/Dissemination Agent. Information may be obtained from the City Contact. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Continuing Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent.
Section 8. Amendment; Waiver. Notwithstanding any other provision of this Continuing Disclosure Agreement, the City may amend this Continuing Disclosure Agreement, and any provision of this Continuing Disclosure Agreement may be waived, if such amendment or waiver is supported by an opinion of counsel expert in federal securities laws, to the effect that such amendment or waiver would not, in and of itself, cause the undertakings herein to violate the Rule if such amendment or waiver had been effective on the date hereof but taking into account any subsequent change in or official interpretation of the Rule.
Section 9. Additional Information. Nothing in this Continuing Disclosure Agreement shall be deemed to prevent the City from disseminating any other information, using the means of
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dissemination set forth in this Continuing Disclosure Agreement or any other means of communication, or including any other information or notice of occurrence of a Listed Event, in addition to that which is required by this Continuing Disclosure Agreement. If the City chooses to include any information or notice of occurrence of a Listed Event in addition to that which is specifically required by this Continuing Disclosure Agreement, the City shall have no obligation under this Continuing Disclosure Agreement to update such information or include it in any future notice of occurrence of a Listed Event.
Section 10. Default. In the event of a failure of the City to comply with any provision of this Continuing Disclosure Agreement, any Bondholder may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Continuing Disclosure Agreement. A default under this Continuing Disclosure Agreement shall not be deemed an Event of Default under the Resolutions, and the sole remedy under this Continuing Disclosure Agreement in the event of any failure of the City to comply with this Continuing Disclosure Agreement shall be an action to compel performance.
Section 11. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent, if any, shall have only such duties as are specifically set forth in this Continuing Disclosure Agreement, and the City agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s gross negligence or willful misconduct. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.
Section 12. Beneficiaries. This Continuing Disclosure Agreement shall inure solely to the benefit of the City, the Dissemination Agent, if any, the Participating Underwriters, and the Bondholders from time to time of the Bonds and shall create no rights in any other person or entity.
[SIGNATURE PAGE TO FOLLOW]
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[Signature Page of Continuing Disclosure Agreement] City of Cudahy, Milwaukee County, Wisconsin
General Obligation Corporate Purpose Bonds, Series 2018B MIL-29053826-1
IN WITNESS WHEREOF, we have executed this Continuing Disclosure Agreement in our official capacities effective March 7, 2018.
[SEAL]
CITY OF CUDAHY, MILWAUKEE COUNTY, WISCONSIN
By: John Hohenfeldt, Mayor
By: Dennis Broderick, City Clerk
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APPENDIX E
NOTICE OF SALE
$7,215,000* GENERAL OBLIGATION CORPORATE PURPOSE BONDS, SERIES 2018BCITY OF CUDAHY, WISCONSIN
Bids for the purchase of $7,215,000* General Obligation Corporate Purpose Bonds, Series 2018B (the "Bonds") ofthe City of Cudahy, Wisconsin (the "City") will be received at the offices of Ehlers & Associates, Inc. ("Ehlers"), 3060Centre Pointe Drive, Roseville, Minnesota 55113-1105, Municipal Advisors to the City, until 10:00 A.M., CentralTime, and ELECTRONIC PROPOSALS will be received via PARITY, in the manner described below, until 10:00A.M. Central Time, on February 21, 2018, at which time they will be opened, read and tabulated. The bids will bepresented to the Common Council for consideration for award by resolution at a meeting to be held at 7:00 P.M.,Central Time, on the same date. The bid offering to purchase the Bonds upon the terms specified herein and mostfavorable to the City will be accepted unless all bids are rejected.
PURPOSE
The Bonds are being issued pursuant to Section 67.04, Wisconsin Statutes, for the public purpose of financing streetimprovements and effecting a current refunding of certain outstanding general obligations of the City as more fullydescribed herein. The Bonds are valid and binding general obligations of the City, and all the taxable property in theCity is subject to the levy of a tax to pay the principal of and interest on the Bonds as they become due which tax may,under current law, be levied without limitation as to rate or amount.
DATES AND MATURITIES
The Bonds will be dated March 7, 2018, will be issued as fully registered Bonds in the denomination of $5,000 each,or any integral multiple thereof, and will mature on April 1 as follows:
Year Amount* Year Amount* Year Amount*
2019 $730,000 2024 $505,000 2029 $415,000
2020 730,000 2025 435,000 2030 420,000
2021 735,000 2026 435,000 2031 425,000
2022 730,000 2027 400,000 2032 175,000
2023 500,000 2028 405,000 2033 175,000
ADJUSTMENT OPTION
* The City reserves the right to increase or decrease the principal amount of the Bonds on the day of sale, in incrementsof $5,000 each. Increases or decreases may be made in any maturity. If any principal amounts are adjusted, thepurchase price proposed will be adjusted to maintain the same gross spread per $1,000.
TERM BOND OPTION
Bids for the Bonds may contain a maturity schedule providing for any combination of serial bonds and term bonds,subject to mandatory redemption, so long as the amount of principal maturing or subject to mandatory redemption ineach year conforms to the maturity schedule set forth above. All dates are inclusive.
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INTEREST PAYMENT DATES AND RATES
Interest will be payable on April 1 and October 1 of each year, commencing October 1, 2018, to the registered ownersof the Bonds appearing of record in the bond register as of the close of business on the 15th day (whether or not abusiness day) of the immediately preceding month. Interest will be computed upon the basis of a 360-day year oftwelve 30-day months and will be rounded pursuant to rules of the Municipal Securities Rulemaking Board. The ratefor any maturity may not be more than 2.00% less than the rate for any preceding maturity. (For example, ifa rate of 4.50% is proposed for the 2019 maturity, then the lowest rate that may be proposed for any latermaturity is 2.50%.) All Bonds of the same maturity must bear interest from date of issue until paid at a single, uniformrate. Each rate must be expressed in an integral multiple of 5/100 or 1/8 of 1%.
BOOK-ENTRY-ONLY FORMAT
Unless otherwise specified by the purchaser, the Bonds will be designated in the name of Cede & Co., as nominee forThe Depository Trust Company, New York, New York ("DTC"). DTC will act as securities depository for the Bonds,and will be responsible for maintaining a book-entry system for recording the interests of its participants and thetransfers of interests between its participants. The participants will be responsible for maintaining records regardingthe beneficial interests of the individual purchasers of the Bonds. So long as Cede & Co. is the registered owner ofthe Bonds, all payments of principal and interest will be made to the depository which, in turn, will be obligated toremit such payments to its participants for subsequent disbursement to the beneficial owners of the Bonds.
OPTIONAL REDEMPTION
At the option of the City, the Bonds maturing on or after April 1, 2028 shall be subject to optional redemption priorto maturity on April 1, 2027 and on any date thereafter, at a price of par plus accrued interest.
Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the selection ofthe amounts and maturities of the Bonds to be redeemed shall be at the discretion of the City. If only part of the Bondshaving a common maturity date are called for redemption, then the City or Paying Agent, if any, will notify DTC ofthe particular amount of such maturity to be redeemed. DTC will determine by lot the amount of each participant'sinterest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interestin such maturity to be redeemed.
Notice of such call shall be given by sending a notice by registered or certified mail, facsimile or electronictransmission, overnight delivery service or in any other manner required by DTC, not less than 30 days nor more than60 days prior to the date fixed for redemption to the registered owner of each Bond to be redeemed at the addressshown on the registration books.
DELIVERY
On or about March 7, 2018, the Bonds will be delivered without cost to the winning bidder at DTC. On the day ofclosing, the City will furnish to the winning bidder the opinion of bond counsel hereinafter described, an arbitragecertification, and certificates verifying that no litigation in any manner questioning the validity of the Bonds is thenpending or, to the best knowledge of officers of the City, threatened. Payment for the Bonds must be received by theCity at its designated depository on the date of closing in immediately available funds.
LEGAL OPINION
An opinion as to the validity of the Bonds and the exemption from federal taxation of the interest thereon will befurnished by Husch Blackwell LLP, Bond Counsel to the City, and will be available at the time of delivery of theBonds. The legal opinion will be issued on the basis of existing law and will state that the Bonds are valid and bindinggeneral obligations of the City; provided that the rights of the owners of the Bonds and the enforceability of the Bondsmay be limited by bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors' rightsand by equitable principles (which may be applied in either a legal or equitable proceeding).
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STATEMENT REGARDING COUNSEL PARTICIPATION
Bond Counsel has not assumed responsibility for this Preliminary Official Statement or participated in its preparation(except with respect to the section entitled ?TAX EXEMPTION" in the Preliminary Official Statement and the ?FORMOF LEGAL OPINION" found in Appendix B).
SUBMISSION OF BIDS
Bids must not be for less than $7,124,812, nor more than $7,647,900, plus accrued interest on the principal sum of$7,215,000 from date of original issue of the Bonds to date of delivery. Prior to the time established above for theopening of bids, interested parties may submit a bid as follows:
1) Electronically to [email protected]; or
2) Facsimile submission to Ehlers, Facsimile Number (651) 697-8555; or
3) Electronically via PARITY in accordance with this Notice of Sale until 10:00 A.M. Central Time, but no bidwill be received after the time for receiving bids specified above. To the extent any instructions or directionsset forth in PARITY conflict with this Notice of Sale, the terms of this Notice of Sale shall control. Forfurther information about PARITY, potential bidders may contact Ehlers or i-Deal LLC at 1359 Broadway,2nd Floor, New York, New York 10018, Telephone (212) 849-5021.
Bids must be submitted to Ehlers via one of the methods described above and must be received prior to the timeestablished above for the opening of bids. Each bid must be unconditional except as to legality. Neither the City norEhlers shall be responsible for any failure to receive a facsimile submission.
A good faith deposit ("Deposit") in the amount of $144,300 shall be made by the winning bidder by wire transfer offunds to KleinBank, 1550 Audubon Road, Chaska, Minnesota, ABA No. 091915654 for credit: Ehlers &Associates Good Faith Account No. 3208138. Such Deposit shall be received by Ehlers no later than two hours afterthe bid opening time. The City reserves the right to award the Bonds to a winning bidder whose wire transfer isinitiated but not received by such time provided that such winning bidder’s federal wire reference number has beenreceived by such time. In the event the Deposit is not received as provided above, the City may award the Bonds tothe bidder submitting the next best bid provided such bidder agrees to such award. The Deposit will be retained bythe City as liquidated damages if the bid is accepted and the Purchaser fails to comply therewith.
The City and the winning bidder who chooses to so wire the Deposit hereby agree irrevocably that Ehlers shall be theescrow holder of the Deposit wired to such account subject only to these conditions and duties: 1) All income earnedthereon shall be retained by the escrow holder as payment for its expenses; 2) If the bid is not accepted, Ehlers shall,at its expense, promptly return the Deposit amount to the winning bidder; 3) If the bid is accepted, the Deposit shallbe returned to the winning bidder at the closing; 4) Ehlers shall bear all costs of maintaining the escrow account andreturning the funds to the winning bidder; 5) Ehlers shall not be an insurer of the Deposit amount and shall have noliability hereunder except if it willfully fails to perform or recklessly disregards, its duties specified herein; and 6) FDICinsurance on deposits within the escrow account shall be limited to $250,000 per bidder.
No bid can be withdrawn after the time set for receiving bids unless the meeting of the City scheduled for award ofthe Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been made.
AWARD
The Bonds will be awarded to the bidder offering the lowest interest rate to be determined on a True Interest Cost (TIC)basis. The City’s computation of the interest rate of each bid, in accordance with customary practice, will becontrolling. In the event of a tie, the sale of the Bonds will be awarded by lot. The City reserves the right to reject anyand all bids and to waive any informality in any bid.
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BOND INSURANCE
If the Bonds are qualified for any bond insurance policy, the purchase of such policy shall be at the sole option andexpense of the winning bidder. Any cost for such insurance policy is to be paid by the winning bidder, except that,if the City requested and received a rating on the Bonds from a rating agency, the City will pay that rating fee. Anyrating agency fees not requested by the City are the responsibility of the winning bidder.
Failure of the municipal bond insurer to issue the policy after the Bonds are awarded to the winning bidder shall notconstitute cause for failure or refusal by the winning bidder to accept delivery of the Bonds.
CUSIP NUMBERS
The City will assume no obligation for the assignment or printing of CUSIP numbers on the Bonds or for thecorrectness of any numbers printed thereon, but will permit such numbers to be printed at the expense of the winningbidder, if the winning bidder waives any delay in delivery occasioned thereby.
QUALIFIED TAX-EXEMPT OBLIGATIONS
The City will designate the Bonds as qualified tax-exempt obligations for purposes of Section 265(b)(3) of the InternalRevenue Code of 1986, as amended.
CONTINUING DISCLOSURE
In order to assist the Underwriters in complying with the provisions of Rule 15c2-12 promulgated by the Securitiesand Exchange Commission under the Securities Exchange Act of 1934 the City will enter into an undertaking for thebenefit of the holders of the Bonds. A description of the details and terms of the undertaking is set forth in AppendixD of the Preliminary Official Statement.
NEW ISSUE PRICING
The winning bidder will be required to provide, in a timely manner, certain information necessary to compute the yieldon the Bonds pursuant to the provisions of the Internal Revenue Code of 1986, as amended, and to provide a certificatewhich will be provided by Bond Counsel upon request.
(a) The winning bidder shall assist the City in establishing the issue price of the Bonds and shall execute anddeliver to the City at closing an "issue price" or similar certificate satisfactory to Bond Counsel setting forth thereasonably expected initial offering price to the public or the sales price or prices of the Bonds, together with thesupporting pricing wires or equivalent communications. All actions to be taken by the City under this Notice of Saleto establish the issue price of the Bonds may be taken on behalf of the City by the City’s municipal advisor identifiedherein and any notice or report to be provided to the City may be provided to the City’s municipal advisor.
(b) The City intends that the provisions of Treasury Regulation Section 1.148-1(f)(3)(i) (defining "competitivesale" for purposes of establishing the issue price of the Bonds) will apply to the initial sale of the Bonds (the"competitive sale requirements") because:
(1) The City shall disseminate this Notice of Sale to potential underwriters in a manner that is reasonablydesigned to reach potential investors;
(2) all bidders shall have an equal opportunity to bid;
(3) the City may receive bids from at least three underwriters of municipal bonds who have establishedindustry reputations for underwriting new issuances of municipal bonds; and
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(4) the City anticipates awarding the sale of the Bonds to the bidder who submits a firm offer to purchasethe Bonds at the highest price (or lowest interest cost), as set forth in this Notice of Sale.
Any bid submitted pursuant to this Notice of Sale shall be considered a firm offer for the purchase of the Bonds, asspecified in this bid.
(c) If all of the requirements of a "competitive sale" are not satisfied, the City shall advise the winning bidder ofsuch fact prior to the time of award of the sale of the Bonds to the Underwriter. In such event, any bid submitted willnot be subject to cancellation or withdrawal and the City agrees to use the rule selected by the Underwriter on its bidform to determine the issue price for the Bonds. On its bid form, each Underwriter must select one of the followingtwo rules for determining the issue price of the Bonds: (1) the first price at which 10% of a maturity of the Bonds (the"10% test") is sold to the public as the issue price of that maturity or (2) the initial offering price to the public as of thesale date as the issue price of each maturity of the Bonds (the "hold-the-offering-price rule").
(d) If all of the requirements of a "competitive sale" are not satisifed and the Underwriter selects the hold-the-offering-price rule, the winning bidder shall (i) confirm that the underwriters have offered or will offer the Bonds tothe public on or before the date of award at the offering price or prices (the "initial offering price"), or at thecorresponding yield or yields, set forth in the bid submitted by the winning bidder and (ii) agree, on behalf of theunderwriters participating in the purchase of the Bonds, that the underwriters will neither offer nor sell unsold Bondsof any maturity to which the hold-the-offering-price rule shall apply to any person at a price that is higher than theinitial offering price to the public during the period starting on the sale date and ending on the earlier of the following:
(1) the close of the fifth (5th) business day after the sale date; or(2) the date on which the underwriters have sold at least 10% of that maturity of the Bonds to the public at aprice that is no higher than the initial offering price to the public.
The winning bidder shall promptly advise the City when the underwriters have sold 10% of that maturity of the Bondsto the public at a price that is no higher than the initial offering price to the public, if that occurs prior to the close ofthe fifth (5th) business day after the sale date.
The City acknowledges that in making the representation set forth above, the winning bidder will rely on (i) theagreement of each underwriter to comply with the hold-the-price rule, as set forth in an agreement among underwritersand the related pricing wires, (ii) in the event a selling group has been created in connection with the initial sale of theBonds to the public, the agreement of each dealer who is a member of the selling group to comply with the hold-the-offering-price rule, as set forth in a selling group agreement and the related pricing wires, and (iii) in the event that anunderwriter is a party to a retail distribution agreement that was employed in connection with the initial sale of the Bonds to the public, the agreement of each broker-dealer that is party to such agreement to comply with the hold-the-offering-price rule, as set forth in the retail distribution agreement and the related pricing wires. The City furtheracknowledges that each underwriter shall be solely liable for its failure to comply with its agreement regarding thehold-the-offering-price rule and that no underwriter shall be liable for the failure of any other underwriter, or of anydealer who is a member of a selling group, or of any broker-dealer that is a party to a retail distribution agreement tocomply with its corresponding agreement regarding the hold-the-offering-price rule as applicable to the Bonds.
(e) If all of the requirements of a "competitive sale" are not satisfied and the Underwriter selects the 10% test, theUnderwriter agrees to promptly report to the City, Bond Counsel and Ehlers the prices at which the Bonds have beensold to the public. That reporting obligation shall continue, whether or not the closing date has occurred, until the 10%test has been satisfied as to each maturity of the Bonds or until all of the Bonds of a certain maturity have been sold.
(f) By submitting a bid, each bidder confirms that (i) any agreement among underwriters, any selling groupagreement and each retail distribution agreement (to which the bidder is a party) relating to the initial sale of the Bondsto the public, together with the related pricing wires, contains or will contain language obligating each underwriter,each dealer who is a member of the selling group, and each broker-dealer that is party to such retail distributionagreement, as applicable, to (A) report the prices at which it sells to the public the unsold Bonds of each maturityallotted to it until it is notified by the winning bidder that either the 10% test has been satisfied as to the Bonds of that
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maturity or all Bonds of that maturity have been sold to the public, and (B) comply with the hold-the-offering-pricerule, if applicable, in each case if and for so long as directed by the winning bidder and as set forth in the related pricingwires, and (ii) any agreement among underwriters relating to the initial sale of the Bonds to the public, together withthe related pricing wires, contains or will contain language obligating each underwriter that is a party to a retaildistribution agreement to be employed in connection with the initial sale of the Bonds to the public to require eachbroker-dealer that is a party to such retail distribution agreement to (A) report the prices at which it sells to the publicthe unsold Bonds of each maturity allotted to it until it is notified by the winning bidder or such underwriter that eitherthe 10% test has been satisfied as to the Bonds of that maturity or all Bonds of that maturity have been sold to thepublic, and (B) comply with the hold-the-offering-price rule, if applicable, in each case if an for so long as directedby the winning bidder or such underwriter and as set forth in the related pricing wires.
(g) Sales of any Bonds to any person that is a related party to an underwriter shall not constitute sales to the publicfor purposes of this Notice of Sale. Further, for purposes of this Notice of Sale:
(i) "public" means any person other than an underwriter or a related party,
(ii) "underwriter" means (A) any person that agrees pursuant to a written contract with the City (or withthe lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bondsto the public and (B) any person that agrees pursuant to a written contract directly or indirectly witha person described in clause (A) to participate in the initial sale of the Bonds to the public (includinga member of a selling group or a party to a retail distribution agreement participating in the initial saleof the Bonds to the public),
(iii) a purchaser of any of the Bonds is a "related party" to an underwriter if the underwriter and thepurchaser are subject, directly or indirectly, to (i) at least 50% common ownership of the voting poweror the total value of their stock, if both entities are corporations (including direct ownership by onecorporation of another), (ii) more than 50% common ownership of their capital interests or profitsinterests, if both entities are partnerships (including direct ownership by one partnership of another),or (iii) more than 50% common ownership of the value of the outstanding stock of the corporation orthe capital interests or profit interests of the partnership, as applicable, if one entity is a corporationand the other entity is a partnership (including direct ownership of the applicable stock or interests byone entity of the other), and
(iv) "sale date" means the date that the Bonds are awarded by the City to the winning bidder.
PRELIMINARY OFFICIAL STATEMENT
Bidders may obtain a copy of the Preliminary Official Statement relating to the Bonds prior to the bid opening byrequest from Ehlers at www.ehlers-inc.com by connecting to the Bond Sales link. The Syndicate Manager will beprovided with an electronic copy of the Final Official Statement within seven business days of the bid acceptance. Upto 10 printed copies of the Final Official Statement will be provided upon request. Additional copies of the FinalOfficial Statement will be available at a cost of $10.00 per copy.
Information for bidders and bid forms may be obtained from Ehlers at 3060 Centre Pointe Drive, Roseville, Minnesota55113-1105, Telephone (651) 697-8500.
By Order of the Common Council
Dennis Broderick, City Clerk-TreasurerCity of Cudahy, Wisconsin
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BID FORMThe Common Council February 21, 2018City of Cudahy, Wisconsin
RE: $7,215,000* General Obligation Corporate Purpose Bonds, Series 2018BDATED: March 7, 2018
For all or none of the above Bonds, in accordance with the Notice of Sale and terms of the Global Book-Entry System (unless otherwise specifiedby the Purchaser) as stated in this Official Statement, we will pay you $__________________ (not less than $7,124,812, nor more than$7,647,900) plus accrued interest to date of delivery for fully registered Bonds bearing interest rates and maturing in the stated years as follows:
% due 2019 % due 2024 % due 2029
% due 2020 % due 2025 % due 2030
% due 2021 % due 2026 % due 2031
% due 2022 % due 2027 % due 2032
% due 2023 % due 2028 % due 2033
* The City reserves the right to increase or decrease the principal amount of the Bonds on the day of sale, in increments of $5,000 each. Increases or decreases may be made in any maturity. If any principal amounts are adjusted, the purchase price proposed will be adjusted tomaintain the same gross spread per $1,000.
The rate for any maturity may not be more than 2.00% less than the rate for any preceding maturity. (For example, if a rate of 4.50%is proposed for the 2019 maturity, then the lowest rate that may be proposed for any later maturity is 2.50%.) All Bonds of the samematurity must bear interest from date of issue until paid at a single, uniform rate. Each rate must be expressed in an integral multiple of 5/100or 1/8 of 1%.
We enclose our Deposit in the amount of $144,300, to be held by you pending delivery and payment. Alternatively, if we are the winning bidder,we will wire our Deposit to KleinBank, 1550 Audubon Road, Chaska, Minnesota, ABA No. 091915654 for credit: Ehlers & AssociatesGood Faith Account No. 3208138. Such Deposit shall be received by Ehlers & Associates no later than two hours after the bid opening time.
The City reserves the right to award the Bonds to a winning bidder whose wire transfer is initiated but not received by such time provided that
such winning bidder’s federal wire reference number has been received. In the event the Deposit is not received as provided above, the Citymay award the Bonds to the bidder submitting the next best bid provided such bidder agrees to such award. If our bid is not accepted, saiddeposit shall be promptly returned to us. If the Deposit is wired to such escrow account, we agree to the conditions and duties of Ehlers &Associates, Inc., as escrow holder of the Deposit, pursuant to the Notice of Sale. This bid is for prompt acceptance and is conditional upondelivery of said Bonds to The Depository Trust Company, New York, New York, in accordance with the Notice of Sale. Delivery is anticipatedto be on or about March 7, 2018.
This bid is subject to the City’s agreement to enter into a written undertaking to provide continuing disclosure under Rule 15c2-12 promulgatedby the Securities and Exchange Commission under the Securities Exchange Act of 1934 as described in the Preliminary Official Statement forthis Issue.
We have received and reviewed the Official Statement and have submitted our requests for additional information or corrections to the FinalOfficial Statement. As Syndicate Manager, we agree to provide the City with the reoffering price of the Bonds within 24 hours of the bidacceptance.
This bid is a firm offer for the purchase of the Bonds identified in the Notice of Sale, on the terms set forth in this bid form and the Notice ofSale, and is not subject to any conditions, except as permitted by the Notice of Sale.
By submitting this bid, we confirm that we are an Underwriter and have an established industry reputation for underwriting new issuances ofmunicipal bonds. YES: ____ NO: ____.
If the competitive sale requirements are not met, we elect to use the (circle one): 10% test / hold-the-offering-price rule to determine the issueprice of the Bonds.
Account Manager: By:Account Members:
Award will be on a true interest cost basis. According to our computations (the correct computation being controlling in the award), the totaldollar interest cost (including any discount or less any premium) computed from March 7, 2018 of the above bid is $_______________and thetrue interest cost (TIC) is __________%.The foregoing offer is hereby accepted by and on behalf of the Common Council of the City of Cudahy, Wisconsin, on February 21, 2018.
By: By:
Title: Title: