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2016 Series B Transcript of Proceedings AMBB GO School Bonds $5,140,000FOSTER PEPPER TRANSCRIPTOF PROCEEDINGS KODIAK ISLAND BOROUGH ALASKA $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES BondDated February 2016 Closing Date February 2016 Bond Counsel FOSTERPEPPER PLLC KODIAK ISLAND BOROUGH ALASKA $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES INDEXOF PROCEEDINGS Document Ii Certificateof Borough Clerk Ordinance No FY2015-02 the Ballot Ordinance Proof of Notice of July 17 2014 Borough Assembly Meeting Minutes of July 17 2014 Borough Assembly Meeting Notice of Public Hearing on Ballot Ordinance Proof of Notice of August 2014 Borough Assembly Meeting Minutes of August 2014 Borough Assembly Meeting Proof of Publication of Notice of Election Proof of Publication of Notice of BondedIndebtedness Ballot used in October 2014 Election Resolution No FY2015-12 Election Certification Proof of Notice of October 16 2014 Borough Assembly Meeting Minutes of October 16 2014 Borough Assembly Meeting Resolution No FY2016-06 the Bond Resolution Proof of Notice of August 20 2015 Borough Assembly Meeting Minutes of August 20 2015 Borough Assembly Meeting Resolution No FY2016-06 the Bond Resolution State of Alaska Department of Education and Early Development Notice of Reimbursement Loan Agreement Official Statement Continuing Disclosure Certificate Tax Certificate Exhibit Draw Down Schedule ExhibitCertificate of theFinancialAdvisor Exhibit Underwriter Representations Exhibit Post-issuance Compliance Procedures for Tax-Exempt Bonds IRS Form8038-G No Litigation Certificate Signature Certificate 10 Specimen Bond 11 Certificateof Finance Director 12 Payment Delivery and Application of Proceeds Certificate 13 Opinion of Foster Pepper PLLC Co-Bond Counsel 14 Opinion of Levesque Law Group LLC Co-Bond Counsel 15 51496271.1 CERTIFICATEOF BOROUGH CLERK KODIAK ISLAND BOROUGH ALASKA $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES Nova Javier MMC Borough Clerkof Kodiak Island Borough the Borough hereby certify as follows on behalf ofthe Borough in connection withthe above-referenced bond The Borough was duly incorporated as second-class borough under the Constitution and laws ofthe State of Alaska on September 24 1963 The members of the Borough Assembly during the period from July 17 2014 to the present and the date of beginning and thedate of expiration of their terms are as follows Tuck Bonney October 2011 to October 2014 Dave Kaplan October 2008 to October 2014 Melvin Stephens October 2011 to October 2014 Aaron Griffin October 2012 to October 2016 Chris Lynch October 2006 to October 2016 Carol Austerman October 2010 to June2016 Mel Stephens October 2016 to October 2016 Frank Peterson Jr October 2013 to October 2016 Larry LeDoux October 2014 to October 2017 Dan Rohrer October 2014 to October 2017 Rebecca Skinner October 2014 to October 2017 Dennis Symmons Kyle Crow Each of the foregoing members of the Borough Assembly was duly elected or appointed and qualified and held office as member ofthe Borough Assembly as stated in the foregoing paragraph SinceOctober 2013 Jerrol Friendhas been andnow is the duly elected qualified and acting Mayor ofthe Borough Since January 172013 Bud Cassidy has been and now is the duly appointed qualified and acting Manager of the Borough Since June 2006 Nova Javier MMC has been and now is the duly appointed qualified and acting Borough Clerkof the Borough Since June 25 2013 JosephLevesque has been and now is the duly appointed qualified and acting Borough Attorney ofthe Borough July 2016 to October 2018 October 2016 to October 2018 Since November 1990 KarletonShorthas been and now is the duly appointed qualified and acting Finance Directorof the Borough Attachedhereto as Exhibit is true and correct copy of Ordinance No FY2O1 5-02 the Ballot Ordinance as adopted at regular meeting of the Borough Assembly held on August 2014 afterintroduction at regular meeting ofthe Borough Assembly held on July 172014 and public hearing held on August 2014 and duly recorded in my office 10 Attachedhereto as Exhibit is true and correct copy of proof ofnotice of the July 17 2014 Borough Assemblymeeting 11 Attachedhereto as Exhibit is true and correct copy of the minutes of the regular meeting ofthe Borough Assembly held on July 172014 reflecting introductionof the Ballot Ordinance 12 Attachedhereto as Exhibit is true and correct copy of proof ofnotice of the public hearing on the Ballot Ordinance 13 Attachedheretoas Exhibit is true and correct copy of proof ofnotice of the August 2014 Borough AssemblyMeeting 14 Attachedhereto as Exhibit is true and correct copy of the minutes of the regular meeting ofthe Borough Assembly held on August 2014 reflecting adoption oftheBallot Ordinance 15 Each of the meetings at which actionsreferred to in paragraphsthrough 14 were taken was duly convened and held inall respects in accordance with law and to theextent required by law due and proper noticeof such meetings was given quorum ofthe Borough Assembly was present throughout such meetings and legally sufficient number of members ofthe Borough Assembly voted in the proper manner for adoption of the Ballot Ordinance the Ballot Ordinance has not been amended modified superseded rescinded or repealed since the date of adoption thereof and all other requirements and proceedings incident tothe properadoption oftheBallot Ordinance have been duly fulfilled carried out and otherwise observed 16 Attachedhereto as Exhibit is true and correct copy of proof of publication of Notice ofElection held on October 2014 17 Attachedhereto as Exhibit is true and correct copy of proof of publication of Notice of Bonded Indebtedness 18 Attachedhereto as Exhibit is true and correct copy of the ballot used in the October 2014 election 19 Attachedhereto as Exhibit is true and correct copy of Resolution No FY2015-12 certifying theOctober 2014 election 496271.1 20 Attachedheretoas Exhibit is true and correct copy of proof ofnotice of the October 16 2014 Borough Assembly meeting certifying the October 2014 election 21 Attached hereto as Exhibit is true and correct copy ofthe minutes of the meeting of the Borough Assembly held on October 162014 reflectingreceipt and approval ofthe Canvass Board Report and the certification of the October 2014 election 22 The October 2014 election was held inall respects in accordance with law and to the extent required by law due and proper notice of such election was given the meeting at which actions referred to in paragraphs 19 through 21 were taken was duly convened and held inall respects in accordance with law and to theextent required by law due and proper noticeof such meeting was given quorum ofthe Borough Assembly was presentthroughout such meeting and legally sufficient number of members ofthe Borough Assembly voted in the proper manner for certification ofthe October 2014 election theelection certification has not been amended modified superseded rescinded or repealed since the date thereof and all other requirements and proceedings incident to the proper conduct of such election have been duly fulfilled carried out and otherwise observed 23 Attachedheretoas Exhibit is true and correct copy of Resolution No FY2016-06 the Bond Resolution as adopted at regular meeting ofthe Borough Assembly held on August 20 2015 and duly recorded in my office 24 Attachedheretoas Exhibit is true and correct copy of proof ofnotice of the August 20 2015 Borough Assemblymeeting 25 Attachedheretoas Exhibit is true and correct copy ofthe minutes of the regular meeting of the Borough Assembly held on August 20 2015 reflecting introductionofthe Bond Resolution 51496271 26 The meeting at which actionsreferred to in paragraphs 23 through 25 were taken was duly convened and held inall respects in accordance with law and to the extent required by law due and proper noticeof such meeting was given quorum ofthe Borough Assembly was present throughout such meeting and legally sufficient number of members ofthe Borough Assembly voted in the proper manner for adoption of the Bond Resolution the Bond Resolutionhas not been amended modified superseded rescinded or repealed since the date of adoption thereof and all other requirements and proceedings incident tothe proper adoption ofthe Bond Resolution havebeen duly fulfilled carried out and otherwise observed Datedas of February 2016 KODIAKISLAND BOROUGH ALASKA By fl1J ti NOVA JAVIER MMg/Borouh Clerk 51496271 Introduced by BoroughManager Requested by Borough Assembly Drafted by Finance Director/Bond Counsel fl Introduced on 07/17/2014 Public Hearing 08/07/2014 Adopted 0607/2014 KODIAK ISLAND BOROUGH ORDINANCE NO FY2015-02 10 11 AN ORDINANCEOFTHE KODIAK ISLAND BOROUGH ASSEMBLY 12 AUTHORIZING THE BOROUGH TO ISSUE GENERAL OBLIGATION 13 BONDS IN TUE PRINCIPAL AMOUNT OFNOTTOEXCEED $10230000 14 TOFINANCETHE RENEWALAND REPLACEMENT SCHEDULE 15 RELATED TO BOROUGHOWNEDSCHOOL FACILITIES PROJECTS 16 WHICHARE70%REIMBURSABLEBY THE STATEOF ALASKA AND 17 TOSUBMITTHE QUESTION OF THE ISSUANCE OF SUCH BONDS TO 18 THE QUALIFIED VOTERSOFTHE BOROUGH ATTHE OCTOBER 19 2014 REGULARBOROUGH ELECTION 20 21 WHEREAS underthe provisions of AS 29.47190 municipality may incur general 22 obLigation debt only after bond authorization ordinance is approvedby majority of those 23 voting on the question at regular or special election and 24 25 WHEREAS the borough owns andmaintains multi-million dollar school facilities and 26 27 WHEREAS the borough maintains Renewal Replacement Schedulewhich provides 28 long term plan to renew aridlor replace worn out building components within the school 29 facilities and 30 31 WHEREAS many ofthe Kodiak Island Boroughs school facilities have worn out building 32 components such as roofs floors undergroundstorage tanks etc that have reached the 33 end of their useful life and 34 35 WHEREAS theStateof Alaska Department of Education has program in which major 36 maintenance projects for school facilities are eligible for 70%reimbursement ofthe bonded 37 debt service on the eligible portion of bondsauthorized by the qualified votersofthe 38 Borough and 39 40 WHEREAS the Borough views the renewal and replacement projects authorizedheroin 41 as necessary and beneficial to the community and acquisition of 70%reimbursement 42 money from the state as the most cost effective way of funding these projects and 43 WHEREAS bonds can be sold for period of 10 to 20 years and qualify for State Debt 45 Reimbursement and 46 47 WHEREAS the True Interest Cost TIC is estimated to be 2.65percent 2.65%and 48 49 WHEREAS per KIBC 7.10.0600 before general obligation bond issueelection the fl SO clerkshallpublish the attached notice ofthe boroughs total existing bondedindebtedness 51 EXHIBIT at least once week for three consecutive weeks The first notice shall be 52 published at least 20 calendar days before the date ofthe election The notice shall state Kodiak island Borough Ordinance No EY2015-02 Page of 53 The current total generalobligation bonded indebtedness including authorized 54 but unsold bonds ofthe borough 55 The costof the debtservice on the current indebtedness and 56 The total assessed valuation of property in the borough 57 58 NOW THEREFORE BE IT ORDAINED BYTHEASSEMBLY OFTHE KODIAK ISLAND 59 BOROUGH THAT 60 61 Section This ordinance is notof general or permanent nature and shallnot become 62 part ofthe Kodiak Island Borough Code of Ordinances 63 64 Section It is hereby determined to be for public purpose and in the public interest of 65 the Borough to incur general obligation bonded indebtedness in an amount 66 not to exceed Ten Million Two Hundred Thirty thousand Dollars 67 $10230000 for the purpose of paying for renewaland replacement 68 projects including planning design construction furnishings and 69 equipment in an effort to carry outthe renewal and replacement schedule 70 related to these facilities as described in Sectionand forsimilar projects if 71 money is available after these projects have been completed 72 73 Section The Borough is authorized to borrow the sum of Ten Million Two Hundred 74 Thirty Thousand Dollars $10230000 to financethe renewal and 75 replacement projects described in Sectionand the borrowing shall be 76 evidenced by the issuance of general obligation bonds of the Borough 77 provided that bonds may not be issued for any project unlessthe project is 78 eligible for debt service reimbursement by theStateof Alaska The full faith 79 and creditofthe Borough are iledged for payment ofthe principal of and 80 interest on the bonds arid ad valorem taxes upon all taxable property in the Borough shall be leviedwithout limitation as to rate or amount to pay the 82 principal of and interest on the bonds when due 83 84 Section The final maturity of the bonds.will beno later than 10.5 years after their date 85 of issuance and the bonds will not be sold if thetrueinterest cost is over 86 percent 4% 87 88 Section The Borough shall submit the followingproposition to the qualified voters of 89 the Borough atthe October2014 regular Borough election The 90 proposition must receive an affirmativevote from majority ofthe qualified 91 voters voting on the question to be approved 92 93 PROPOSITION NO 94 GENERAL OBLIGATION BONDS $10230000 SCHOOL FACiLITIES RENEWAL ANDREPLACEMENT PROJECTS 96 97 Shallthe Kodiak Island Borough incur debt and issue general 98 obligation bonds in an amount not to exceed Ten Million Two 99 Hundred Thirty thousand Dollars $10230000 for the ioo purpose of paying the costof school facilities renewaland ioi replacement projects which are 70%reimbursable by the 102 State of Alaska that addressworn out building components 103 suchas roofs floors underground storage tanks etc that 104 have reached the end of their useful life including without Kodiak Island Borough Ordinance No FY2015-02 Page 2of5 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 limitation the projects describedbelowand other related projects Project Name Cost Kodiak Middle School UndergroundStorage Tank Replacement 150000 East Elementary School Flooring Replacement 649000 Peterson Elementary School Flooring Replacement 363500 PortLions School UndergroundStorage Tank Replacement 200000 Main Elementary School UndergroundStorage Tank Replacement 150000 Kodiak Middle School New Elevator controls 54000 Kodiak Middle SchoolSchool NewHVAC Heating Controls 1576200 Peterson Elementary School New HVACHeating Controls 694900 Kodiak Middle SchoolRearParking Lot Paving 675800 East Elementary School Cafeteria Roof Replacement 1248500 OuzinkieSchool Old Wing Flooring Replacement 160300 OuzinkleSchool New Wing Flooring Replacement 41000 AkhiokSchool Flooring Replacement 95500 Kodiak Middle School Fire Alarm Replacement 405000 East Elementary School Partial Interior Renovation 687200 Peterson Elementary SchoolParking Lot Paving 972000 Kodiak Middle School Bus Ramp Roof Replacement 118800 Peterson Elementary School Replacement of Boilers 324600 Main Elementary School Gym Floor Replacement 450000 Karluk School Flooring Replacement 86700 ChiniakSchool Playground Equipment Replacement 101200 Karluk School Playground Equipment Replacement 101200 AkhiokSchool Playground Equipment Replacement 101200 East Elementary SchoolReplacement of Plumbing Fixtures 256500 OldHarborSchool Playground Equipment Replacement 121500 Ouzinkie School Playground Equipment Replacement 121500 PortLions School Playground Equipment Replacement 121500 OldHarborSchool Underground Storage Tank Replacement 202400 Project Totals 1oa30000 70%State Reimbursement 7161000 30%Local Contribution 3069000 The projects are expected to qualify for notless than 70% State debt service reimbursement funding for which is subject to annual appropriation The projects will be scheduledassuch to limit disruption to the education of students andbonds will be sold only as needed to pay project costs If theState fully funds the debt service reimbursement program the average annualdebt service payableby the Borough after State reimbursement is estimated to be $353569 This amount of debt service may require an additional annual property tax levy of $84 per $250000 of assessed value or its equivalent This example of property tax levy is provided forillustrative purposes only Ordinance No FY2O15-02 Page of Kodiak Island Borough 122 The bonds shall be secured bypledge of the full faith and 123 creditof the Borough Ordinance No FY2015-02 124 125 Section The proposition shall be printed on ballot which may setforthother general 126 obligation bond propositions and the following words shall be added as 121 appropriate nextto an oval provided for marking the ballot for voting by hand 128 or machine 129 PROPOSITION NO.1 YES NO 130 131 132 Section Sections and of this ordinance shall become effective only if the 133 proposition described in Section is approvedby majority ofthe qualified 134 voters voting on the proposition at the October 2014 regular Borough 135 election The remaining sectionsof this ordinance shall become effective 136 upon adoptionby the Kodiak Island Borough Assembly 137 138 ADOPTEDBYTHEASSEMBLY OFTHEKODIAK ISLAND BOROUGH 139 THIS SEVENTHDAYOF AUGUST 2014 140 141 142 KODIAK ISLAND BOROUGH____ 146 ãlrroi Frien orough Mayor 147 148 ATTEST 152 Nova Javier MMC rough Clerk 153 154 Kodiak Island Borough Ordinance Nc FY2015-02 Page of 155 EXHIBIT 156 KODIAK ISLAND BOROUGH LI 157 NOTICE OF EXISTING BONDED INDEBTEDNESS 158 As of June 30 2014 159 Pursuant to AS 29.47.190b and KiBC 7.10.060d requiring governmental units to 163 publish Notice of Existing Bonded Indebtednessbefore generalobligation bond 161 elections the Kodiak Island Borough publishes the following notice GENERAL OBLIGATION BONDS Authorized ButUnsold Balance 6/30/2014 School Construction 2004D -0-530000 School Construction 2008A -0-6305000 School Construction 2011 Series One 7145000 School Construction 2012A 5195000 School Construction 2012B -0-6340000 School Construction 2013 Series one -0-20960030 School Construction 2014 -0-22660000 69135000 162 Fiscal Year Ending June 30 Principal Interest Total 2015 2640000 31198855759885 2016 3170000 29893626159362 2017 3295000 28692126164212 2018 3395000 27504636145463 2019 3540000 26173626157362 2020 3670000 24784876148487 2021 3815000 23361006151100 2022 3980000 21665506146550 2023 4160000 19857016145701 2024 4355000 17895386144538 2025 4570000 15725716142571 2026 3310000 14020254712025 2027 3470000 12382284708228 2028 3645000 1064121 4709121 2029 3205000 881234 4086234 2030 3365000 720315 4085315 2031 3535000 551359 4086359 2032 3085000 381190 3466190 2033 3240000 226940 3466940 2034 1690000 84500 1774500 69135000 33225143 $102360143 163 164 Total Assessedvalue January 2014 $1181899002 165 Karleton Short Nova Javier MMC 166 Finance Director Borough Clerk Kodiak Island Borough Ordinance No FY2015-02 Page of T.. Publishers Affidavit UNITED STATES 01 AMERICA SS State of Alaska the undersigned being first duly sworn depose and say am Editor or Publisher of the Kodiak Daily Mirror daily newspaper published Kodiak Tiurd Judicial Division Státcof Alaska and that the annexed Rrlnted notice was published said newspaper in issues of the following dates 7/q/// x______ Signature of Editoror Publisher SUBSCRIBED ANDSWORN to before meth2dayof Fiiq/sT 2O/V NOTARY PUBLIC in and for theState of Alaska O1A1 My Commisswn expires op I1IHIItIt NOTICEOF PUBLIC MEETINGS All meetings of recognized boardscommittees andcommissions of the Borough are open to the public Wednesday July 2014 830 a.m KodiakFisheries Work Group RegularMeeting Borough Conference Room 630 p.m planning and Zoning Commission Work Session/Special Work Session Borough Conference Room Thursday July 10 2014 730 p.m Assembly Work Session Borough Conference Room Wednesday July 16 2014 530 p.m Personnel Advisory Board Regular Meeting Borough Conference Room 630 p.m planning and Zoning Commission RegularMeeting/Special Work Session Borough Assembly Chambers Thursday July 17 2014 730 p.m Assembly RegularMeeting Borough Assembly Chambers planning and Zoning Commission Special Work Sessionsare for the purpose of reviewing the Draft Code Revisions toTitles 1617 and 18 Please check the Borough website or contact Community DevelopmentDepartment at 486-9363 for specific Title review dates ASSEMBLY WORK SESSION AGENDA Thursday July 102014 730 p.m BoroughConference Room AGENDA ITEMS Furniture Fixtures and Equipment FFE Procurement Process PACKET REVIEW NEW BUSINESS CONTRACTS Contract No FY2015-06 FourSchools Port LionsKarluk Old Harbor and North Star Generators Project Contract No FY2015-07 Aerial Imagery Acquisition ORDINANCES FOR INTRODUCTION Ordinance No FY2015-02 Authorizing the Borough to IssueGeneral Obligation Bonds in the Principal Amount of Not to Exceed $10230000 to Financethe Renewaland Replacement Schedule Related to Borough Owned School Facilities Projects Which are 70%Reimbursable by the State of Alaska and to Submit the Question of theIssuance of SuchBonds to the Qualified Voters of the Borough at the October 2014 Regular Borough Election Ordinance No FY2015-OIA Amending Ordinance No FY2015-01 Fiscal Year2015 Budgetby Amending theGeneral Fund Fund100 and the Replacement and RenewalFund Fund469 to Fund Painting of thePortLions School EXECUTIVESESSION Borough Managers Performance Evaluation NOTICEOF PUBLIC HEARING The Kodiak Island BoroughAssembly will hold publichearing on Thursday July 17 2014 at 730 p.m in the BoroughAssembly Chambers to hear comments on Ordinance No FY2015-02 Authorizing the Borough to IssueGeneral Obligation Bonds in the Principal Amount of Not to Exceed $10230000 to Financethe Renewaland Replacement Schedule Related to Borough Owned School Facilities Projects Which are 70%Reimbursable by the State of Alaska and to Submit theQuestion of theIssuance of SuchBonds to the Qualified Voters of the Borough at theOctober 2014 Regular Borough Election Ordinance No FY2015-OIA Amending Ordinance No FY2015-01 Fiscal Year2015 Budgetby Amending theGeneral Fund Fund100 and the Replacement and RenewalFund Fund469 to Fund Painting of thePortLions School ATTENTION NOTICEOFREAL PROPERTY AREA REVIEW As requiredby State Statute and Borough Code theKodiak Island Borough Assessors Office will be conducting real property assessment reviews on properties located within Service Area No and remote propertiesincluding Old Harbor Kodiaks West sidefrom UyakBay to Kizhuyak Bay including Port Lions Sitevisits generally consist of exterior photos andmeasurements to document changes or additions and to confirm existing information on file If you have questions or concerns please call the Assessors Office at 486-9353 ATTENTION The Kodiak Fisheries Research Center and TouchTankannounces its Summer Hours starting Saturday May 312014 OpenMonday Saturday a.m to 430 p.m Closed Sunday For additional information call 481-1800 NOTICEOF VACANCIES Applications are currently beingaccepted for vacancy on the Architectural/Engineering Review Board vacancy on the Parks and Recreation Committee and vacancies on the Solid Waste Advisory Board For complete list of currentvacancies for the Kodiak Island Boroughs Boards Commissions and Committees please visit our website at http//www.kodiakak.uS Board Vacancies and Application page Sign-up online at www.kodiakak.us to receive e-mail notifications once agendas packets newsletters or minutes of the Assembly areavailable on the web KODIAK ISLAND BOROUGH Assembly RegularMeeting fl July 17 2014 regular meeting of the Kodiak Island Borough Assembly was held on July 172014 in the Assembly Chambers ofthe Kodiak Island Borough Building 710 MIII Bay Road The meeting was calledtoorderat 730 p.m The invocation was givenbyMajor MichaelBates of the Salvation Army Mayor Friend led the Pledge of Allegiance Presentwere Mayor Jerrol FriendAssembly members Tuck Bonney Dave Kaplan Chris Lynch andMel Stephens Also present were Borough Manager Bud Cassidy Engineering and Facilities Director Bob Tucker Clerk Nova Javier and Deputy Clerk Jessica Kilborn KAPLAN moved to excuse Assembly members Carol Austerman and Aaron Griffin who were absentdue to personal leave VOICE VOTE ON MOTIONCARRIEDUNANIMOUSLY APPROVAL OF AGENDA AND CONSENTAGENDA PETERSON moved to approve the agenda and consent agenda VOICE VOTE ON MOTIONCARRIEDUNANIMOUSLY APPROVALOFMINUTES RegularMeeting Minutes of May 152014 were approved under the consent agenda AWARDSAND PRESENTATIONS Manager Cassidy presented the Employee of The Quarter award for the second quarter of 2014 to Jeanne Miller Accounting Technician/Accounts Payable in the Finance Department CITIZENS COMMENTS Tanciuy Libbrecht thanked the Assembly for its support ofthe Red Cross of America Kathrynn HolIis-Bucbnan advocated for continued support of the Red Cross of America and the training the Red Cross provided for the community Dennis Symmons Betty MacTavish Judi Kidder andAaron Williams spoke in opposition of fl Ordinance No FY2014-20Decorum in Debate adopted at the regular Assembly meeting of July 32014 Kodiak Island Borough Assembly Regular Meeting Minutes July 17 2014 Page 1388 Ken Reinke Director of Threshold Recycling Services spoke on the recycling services provided by the organization arid thanked the Assembly and the community for its support He also spoke about the new recycling facility located in the Matanuska-Susitria Borough COMMiTTEEREPORTS Assembly member Lynch reported on the Kodiak Fisheries Work Group meeting of July She announced the next meeting wouldbe held on Thursday July 24 at 10 am atthe Kodiak Fisheries Research Center PUBLiC HEARING None BOROUGH MANAGERS REPORT Manager Cassidy reported on the following Would be out of town July 22-August Assessor Bill Roberts would serve as the administrative officer Met withNational Oceanic and Atmospheric Administration NOAA regarding its lease at the Kodiak Fisheries Research Center NOAA representatives indicated they would remain in Kodiakandwould use the facility They expressed concerns with the operational costs of the building andwere interested in other options which included sub-renting and possibly reducing the footprint Manager Cassidy wouldkeep the Assemblyupdated MESSAGES FROMTHE BOROUGH MAYOR Mayor Friendoffered condolences to the family of long-time Kodiak residentIver Malutin He spoke to the efforts of Mr Malutin towards the community and the relationship he had with the Borough He also spoke on the meeting held on July with NOM whichheattended with Manager Cassidy and Assembly member Lynch UNFINISHED BUSINESS None NEW BUSINESS Contracts Contract No FY20 15-06FourSchools Port LionsKarluk Old Harbor andNorth Star Generators Project BONNEY moved to authorizethe Manager to execute Contract No FY2015-06 with Wolverine Supply Inc of Wasilla AK for the FourSchoolGenerators Project in an amount notto exceed $924000 The contract was for the Four SchoolGenerators project as shown in the construction documents prepared by JensenYorba Lott Inc The workincluded installing new electrical Kodiak Island Borough Assembly Regular Meeting Minutes July 17 2014 Page 1389 generators at Port LionsKarluk Old Harbor andNorth Star Elementary schools PortLions andNorth Star schools were scheduled to be completedby January 2015 and Karluk and OldHarborschools by July 15 2015 An invitation to bid was issued on June 2014 and bids were opened on June 26 2014 Only one bid was received from Wolverine Supply Inc of Wasilla Alaska Wolverine Supply was currently working on the Kodiak Fisheries Research Center VentilationModifications project andhad successfully completed several Borough projects in the past The base bid scope of work included installing new60kw generalors at Port LionsKarluk and OldHarbor schools includingrequired site work Two alternates for North Star Elementary were also included in the bid one to install 60kw generator and one to install 125kw generator The larger generator wouldenable power to be provided to the whole school rather than just emergency functions The base bid and alternate number two would be completed within the budget available and staff recommended thatalternate number two be included in the contract award The project was funded by an Alaska Designated Legislativegrant received in FY20 12 The grant was for installation of generators at Kodiak High School East Elementary and thefour schools listed above Therewere adequate funds remaining in the grant to complete the project ROLL CALL VOTE ON MOTION CARRIED UNANIMOUSLY BonneyKaplanLynch Peterson and Stephens Resolutions None Ordinances for Introduction Ordinance No FY2015-02 Authorizing the Borough toIssue General Obligation Bonds in the Principal Amount of Not to Exceed $10230000 to Finance the Renewaland Replacement Schedule Related to Borough Owned School Facilities Projects Which are 70%Reimbursable by theState of Alaska and to Submit the Question of the Issuance of Such Bonds to theQualified Voters of the Borough at the October2014 Regular Borough Election LYNCH moved to adopt Ordinance No FY2O1 5-02 infirst reading to advance to public hearing at thenext regular meeting of the Assembly memo from Finance DirectorShort and correctedversion of Ordinance No FY2O1 5-02 were provided as requested atthe July 10 work session The ordinance would place beforethevoters the question of issuing general obligation bonds on the October 2014 ballot II approved up to $10230000 in general obligation bondswould be sold to pay for the cost ofcertain Renewal and Replacement projects in school facilities The projects to be funded withthe bonds addressedworn outschool building components such as roofs floors undergroundstorage tanks etc that hadreached the end of their useful life and Kodiak Island Borough Assembly RegularMeeting Minutes July 17 2014 Page 1390 required overhaul or replacement list of projects to be included were provided to the Assembly The State of Alaska would reimburse the Borough 70%of the principal and interest costs associated with the projects included in lunding from the bond issue which amounted to $8249945-The remaining 30%equaled $3535690 ROLL CALL VOTE ON MOTIONCARRIEDFOURTO ONE KaplanLynch Peterson and Bonney Ayes Stephens No Ordinance No FY201501A Amending Ordinance No FY2015-01 Fiscal Year 2015 Budget by Amending the General Fund Fund 100 and the Replacement andRenewal Fund Fund 469 to Fund Painting of thePortLions School KAPLAN moved to adopt Ordinance No FY2015-OIA infirst reading to advance to public hearing atthenext regular meeting of the Assembly The PortLionsschool needed to be repainted over the summer and the fundswere available in the GeneralFund to do the work The project was estimated to cost $131 p000 ROLL CALLVOTE ON MOTION CARRIEDUNANIMOUSLY Lynch Peterson Stephens Bonney and Kaplan OtherItems None EXECUTIVESESSION Borough Managers PerformanceEvaluation LYNCH moved to convene intoexecutive session to discuss the Borough Managers performance evaluation subject that qualifies for executive sessionasmatter that may tend to prejudice his reputation or character ROLL CALL VOTE ON MOTIONCARRIEDUNANIMOUSLY Peterson StephensBonney Kaplan and Lynch Mayor Friendinvited the Assembly members and Manager to join in theexecutive session After the vote Mayor Friend recessed the regular meeting andconvened theexecutive session at 815 p.m Upon returning from theexecutive session Mayor Friend reconvened the regular meeting at ri 840p.m Kodiak Island Borough Assembly RegularMeeting Minutes Jutyl72014 Pagel39l LYNCH moved toincrease the Managers annual salary to $155000 retroactive to January 2014 ROLL CALL VOTE ON MOTION CARRIEDFOUR TO ONE BonneyKaplanLynch and Peterson Ayes Stephens No CITIZENS COMMENTS Judi Kidder spoke tothe use ofthe Facilities Fund account for renewal and replacement projects ASSEMBLY MEMBERS COMMENTS Assembly member Stephensspoke to Ms Kidders comments regarding use of the Facilities Fund for projects Assembly member Petersonthanked Major Bates for providing theinvocation for Assembly meetings and commended Mr Reinke forhis dedication to Threshold Recycling Services Assembly member Lynch thanked Red Cross of America for the update on its activities and urged othernon-profitorganizations to providequarterly reports to the Assembly Assembly members Lynch andPeterson congratulated Employee of the Quarter award recipient Jeanne Miller Announcements Mayor Friend announced the next Assembly worksessionwouldbe held on Thursday July 31 at 730 p.m in the Borough Conference Room The next regular meeting was scheduled on Thursday August at 730 p.m in the Borough Assembly Chambers ADJOURNMENT KAPLAN moved to adjourn the meeting ROLL CALL VOTE ON MOTION CARRIEDUNANIMOUSLY Bonney Kaplan Lynch Peterson and Stephens The meetrng was adjourned at 545 p.m ATT Jerrol Friéfd Mayor Nova Javier MMC Boron 4çTh Approved on September 2014 Kodiak Island Borough Assembly RegularMeeting Minutes July 17 2014 Page 1392 UNITED STATES OF AMERICA State of Alaska Pñblishers Affidavit SS théundersigned being first duly sworn depose and say am Editor or ublisher of the Kodiak Daily Mirror daily newspaper published in Kodiak Third Judicial Division State of Alaska and that the annexed rinted notice was published In said newspaper in issues of the following dates Signature of Editoror Publisher SUBSCRIBED ANI SWORN to before in this 2day of /L/9V1 2OE NOTARY PUBLIC in and for theState of Aja My Commission expireshLL NOTICEOF PUBLIC MEETINGS All meetings of recognized boards committees and commissions of the Borough are open to the public Wednesday July 2014 830 am Kodiak Fisheries Work Group RegularMeeting Borough Conference Room 630 p.m planning and Zoning Commission Work Session/Special Work Session Borough Conference Room Thursday July 10 2014 730 p.m Assembly Work Session Borough Conference Room Wednesday July 16 2014 530 p.m Personnel Advisory Board Regular Meeting Borough Conference Room 630 p.m Planning and Zoning Commission Regular Meeting/Special Work Session Borough Assembly Chambers Thursday July 17 2014 730 p.mAssembly Regular Meeting Borough Assembly Chambers planning and Zoning Commission Special Work Sessions are for the purpose of reviewing the Draft Code Revisions toTitles 1617 and 18 Please check the Borough website or contact Community Development Department at 486-9363 for specific Title review dates ASSEMBLY WORK SESSION AGENDA Thursday July 10 2014 730 p.m BoroughConference Room AGENDA ITEMS Furniture Fixtures and Equipment FFE Procurement Process PACKET REVIEW NEW BUSINESS CONTRACTS Contract No FY2OI 5-06FourSchools Port LionsKarluk Old Harbor and North Star Generators Project Contract No FY2OI 5-07 Aerial Imagery Acquisition ORDINANCESFORINTRODUCTION Ordinance No FY2015-02 Authorizing the Borough to Issue General Obligation Bonds in the Principal Amount of Not to Exceed $10230000 to Finance the Renewaland Replacement Schedule Related to Borough Owned School Facilities Projects Which are 70%Reimbursable by theState of Alaska and to SubmittheQuestion of theIssuance of SuchBonds to the Qualified Voters of the Borough at theOctober 2014 Regular Borough Election Ordinance No FY2015-OIA Amending Ordinance No FY2015-01 Fiscal Year2015 Budgetby Amending theGeneral Fund Fund100 and the Replacement and RenewalFund Fund469 to Fund Painting of the Port Lions School EXECUTIVE SESSION Borough Managers Performance Evaluation NOTICEOF PUBLIC HEARING The Kodiak Island BoroughAssembly will hold publichearing on Thursday July 17 2014 at 730 p.m in the BoroughAssembly Chambers to hear comments on Ordinance No FY2015-02 Authorizing the Borough to IssueGeneral Obligation Bonds in the Principal Amount of Not to Exceed $10230000 to Financethe Renewal and Replacement Schedule Related to Borough Owned School Facilities Projects Which are 70%Reimbursable by the State of Alaska and to SubmittheQuestion of theIssuance of SuchBonds to the Qualified Voters of the Borough at theOctober 2014 Regular Borough Election Ordinance No FY2015-OIA Amending Ordinance No FY2015-01 Fiscal Year2015 Budgetby Amending theGeneral Fund Fund100 and the Replacement andRenewalFund Fund469 to Fund Painting of thePortLions School ATTENTION NOTICEOFREALPROPERTY AREA REVIEW As requiredby StateStatute and Borough Code theKodiak Island Borough Assessors Office will be conducting real property assessment reviews on properties located within Service Area No and remote properties including Old Harbor Kodiaks West side from UyakBay to Kizhuyak Bay including Port Lions Sitevisits generally consist of exterior photos and measurements to document changes or additions and to confirm existing information on file If you have questions or concerns please call the Assessors Office at 486-9353 ATTENTION The Kodiak Fisheries Research Center andTouchTankannounces its Summer Hours starting Saturday May 312014 OpenMonday Saturday a.m to 430 p.m Closed Sunday For additional information call 481-1800 NOTICEOF VACANCIES Applications are currently beingaccepted for vacancy on the Architectural/Engineering Review Board vacancy on the Parks and Recreation Committee and vacancies on the Solid Waste Advisory Board For complete list of currentvacancies for theKodiak Island Boroughs Boards Commissions and Committees please visit our website at httrx//www.kodiakak.us BoardVacancies and Application page Sign-up online at www.kodiakak.us to receive e-mail notifications once agendas packets newsletters or minutes of the Assembly areavailable on the web AC ItIt CA CA Ia4 IAI Publishers Affidavit UNITED STATES OF AMERICA State ofAlaska SS the undersigned being first duly sworn depose and say am Editoror Publisherof the Kodiak Daily Mirror daily newspper published in Kodiak Third Judicial Division State of Alaska and that the annexed printed notice was published in said newspaper in issues of the following dates CA CM CA CA CD -I 11 CA CA CA x_ Signature of Editor or Publisher SUBSCRIBED AND SWORN tobefore mU is 9.1 day of OC 20J OTARY PUBLIC in and for theState of Commission KODIAK ISLAND BOROUGH Assembly Regular Meeting August 2014 regular meeting ofthe Kodiak Island Borough Assembly was held on August 2014 in the Assembly Chambers of the Kodiak Island Borough Building 110 Mill Bay Road The meeting was called to order at 730 p.m The invocation was givenbySergeant Major Dave BlacketeroftheSalvation Army Mayor Friendledthe Pledge of Allegiance Presentwere Mayor Jerrol Friend Assembly members Carol Austerman Tuck Bonney Aaron Griffin Dave Kaplan Chris Lynch FrankPeterson Jr andMel Stephens Staff members present were Borough Manager Bud Cassidy Clerk Nova Javier and Assistant Clerk Angela Mackenzie APPROVAL OF AGENDA ANDCONSENT AGENDA KAPLAN moved to approve the agenda andconsent agenda VOICE VOTE ON MOTIONCARRIED UNANIMOUSLY APPROVAL OFMINUTES RegularMeetIng Minutes of July 2014 were approved under theconsent agenda AWARDS AND PRESENTATIONS None CITIZENS COMMENTS Betty Maclavish Lisa Zeimer andDennis Symmons spoke in opposition of OrdinanceFY2014- 20 SusanBrockman andBeverly Cole of theSenior Citizens of Kodiak SCOK presented tothe Assembly and expressed appreciation to the Assembly for its support COMMITTEE REPORTS None PUBLIC HEARING Ordinance No FY2OI 5-02 Authorizing the Borough toIssue General Obligation Bonds in the Principal Amount of Not to Exceed $10230000 to Finance the Renewal and Replacement ScheduleRelated to Borough Owned School Facilities Projects Which are 70%Reimbursable by the State of Alaska and to SubmittheQuestion ofthe Issuance of SuchBonds to the Qualified Voters ofthe Borough at the October 2014 RegularBorough Election GRIFFINmoved to adopt Ordinance No FY2OI 5-02 11 Kodiak Island Borough Assembly RegularMeeting Minutes August 2014 Page 1393 The ordinance would be placed before thevoters tho question of issuing generalobligaUon bonds on the October 2014 ballot If approved up to $1 0230.000 in general obligation bonds would be soldto pay for thecostofcertain Renewaland Replacement projects in school facilities The projects to be funded with these bondsaddress worn outschool building components suchas roofs floors underground storage tanks etc that had reached the end of their useful life and required overhaul or replacement list of projects to be included were provided tothe Assembly The State of Alaskawould reimburse the Borough 70%ofthe principal and interestcosts associated withthe projects included in funding from the bond issue which amounted to $6249945 The remaining 30%equals $3535690 Mayor Friend opened the public hearing Seeing and hearing noneMayor Fnend closed the public hearing ROLL CALL VOTE ON MOTION CARRIED SIX TO ONE AustermanBonney Griffin Kaplan Lynch Peterson Ayes and Stephens No Ordinance No FY2015-OIAAmending Ordinance No FY2015-01 Fiscal Year 2015 Budgetby Amending the General Fund Fund100 and the Replacement and Renewal Fund Fund 469 to Fund Painting ofthePort Lions School KAPLAN moved to adopt Ordinance No FY2015-OIA The PortLions School needed to be repainted over the summer and thefunds were available in the General Fund to do the work The project was estimated to cost $131000 Mayor Friend opened the public hearing Seeing and hearing noneMayor Friend closed the public hearing ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY Bonney Griffin Kaplan Lynch Peterson Stephens and Austerman BOROUGH MANAGERS REPORT Manager Cassidy reported on the following Attendance at the Alaska Municipal Managers Association in NomeAK August 12-15 2014 Setting up meeting with Lobbyist Mark Hickey Representative Alan Austerman and Senator Gary Stevens in preparation for the Capital Improvements Project List CIP List Social Media policy is being reviewed by the Borough Attorney Joe Levesque Videostreamingequipment was currently being installed in the Assembly Chambers MESSAGESFROM THE BOROUGH MAYOR Mayor Friend spoke to safety withthevarious construction work happening aroundtown and on the road ways UNFINISHED BUSINESS None Kodink Island Borough Assembly Regular Meeting Minutes August 2014 Page 1394 NEW BUSINESS Contracts Contract No FY2O1 5-09 Snow Removal Sanding and Road Repair in Monashka Bay Road Service Area LYNCH moved toauthorize the Manager to executeContract No FY2015-09 with Brechan Enterprises Inc of Kodiak Alaska for snow removal sanding androad repair in Monashka Bay Road ServiceArea on time and materials basis based on their Bid Schedule The BoroughEngineering and Facilities Department advertised the need for labor and equipment to provide snow removal sanding androad repair in the Monashka Bay Service Area Bids werereceived from Brechan Enterprises Inc Golden Alaska Excavating LLC MK Enterprise LLC Aim Maintenance and Kodiak Lawn Care Bid schedules were reviewed and compared by the Monashka Bay ServiceAreaBoard at its RegularMeeting on July 2014 The Board based on the costs equipment availability and workforco levels voted to recommend Brechan Enterprises Inc beawarded the roadmaintenance contract for the Monashka Bay Service Area ROLL CALL VOTE ON MOTIONCARRIEDUNANIMOUSLY Griffin KaplanLynch Peterson StephensAusterman and Bonney Contract No FY2015-10Snow Removal Sanding and Road Repair in Bay ViewRoad Service Area PETERSON moved to authorize the Manager to executeContract No FY2OI 510 with Brechan Enterprises Inc of Kodiak Alaska for snow removal sanding and road repair in Bay View Road Service Area on time and materials basis based on their Bid Schedule The BoroughEngineering and Facilities Department advertisedthe need forlabor and equipment to provide snow removal sanding androad repair services in the Bay View Service Area Bids were received from Brechan Enterprises Inc GoldenAlaska Excavating LLC MK Enterprise LLC Aim Maintenance and Kodiak Lawn Care Bid schedules werereviewed and compared by the Bay View ServiceAreaBoard at its RegularMeeting on June 23 2014 The Board basedon the costs equipment availability and workforce levels voted to recommend Brechan Enterprises Inc be awarded the Road MaintenanceContract for the Bay View Service Area ROLL CALL VOTE ON MO11ONCARRIEDUNANIMOUSLY Kaplan Lynch Peterson Stephens Austerrnan Bonney and Griffin Resolutions Resolution No FY2015-04 Reappointing Member tothe Kodiak Fisheries Development Association Linda Freed This item was approved under the consent agenda EL Kodiak Island Borough Assembly RegularMeeting Minutes August 2014 Page 1395 The Borough and City of Kodiak jointly designated the Kodiak Fisheries Development Association KFDA as the eligible crab community entity ECCE The by-laws ofthe KFDA provide for appointment ofDirectors tothe Board by the Kodiak Island Borough Assembly and the Kodiak City Council for three-year terms Two ofthethree Joint KFDA Directors Seats expired in July 2014 Ms LindaFreed wished to be reappointed for seat to expire July 2017 Resolution No FY2OI 5-05 DesignatIng State of Alaska Department of Environmental ConservatIon GrantFunds for the Kodiak Landfill lateral Expansion Phase Ill as the NumberOne LocalState Funding Priority for Fiscal Year 2015 AUSTERMAN moved to adopt Resolution No FY2015-05 The Kodiak Landfill Lateral Expansion Phase Ill was the final phase of the landfill expansion project and was theconstructionofthe wastewater treatment plant to treat the landfills leachate to the required drinking water discharge standard Borough staff was applying for Municipal Matching Grant through theStateof Alaska Department of Environmental Conservation ADEC toassist withthe funding ofthe project in an effort to reduce the burden of debt on thelocalrate payers The budget for the overall project remains just under $32 million with Phase Ill estimated tocost approximately $16 million Staff was requesting $1825000 in grant funding in thecurrent application totheMunicipal Matching GrantProgram resolution that designated the project as the Boroughs number one priority for statefunding was requirement of the grant application ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY Lynch Peterson Stephens AustermanBonney Griffin and Kaplan Ordinances for Introduction None Other Items Hiring oftheSolid Waste Manager/Environmental Specialist AUSTERMAN moved to approve thehiring ofthe current applicant as theSolid Waste Manager/Environmental Specialist at Range 23 Step ofthe salary schedule The Solid Waste Manager/Environmental Specialistposition has been vacant for nearly year An application was recently received from highly qualified candidate however the requested starting salary was above Step ofthe salary scale which was beyond the Managers authority Li to approve The Borough Manager was requesting approval ofstartingsalary at Range 23 Step ofthe salary schedule for reasons stated in the attached memo ROLL CALL VOTE ON MOTIONCARRIED SIX TO ONE Peterson AustermanBonney Griffin Kaplan and Lynch Ayes and Stephens No Li Kodiak Island Borough Assembly Regular Meeting Minutes August 2014 Page 1396 Vacation ofPortionof Utility Easement Identified on P1st 2014-6 for Pillar Creek Hatchery Tract KIBC 16.60 This item was approved under the consent agenda At the July 16 2014 Planning and Zoning Commission regular meeting the Commission approved the vacation of portion of utility easement identified on Plat 2014-8 for Pillar Creek Hatchery Tract subject to one specific conditionof approval The area to be vacated was withinthe Borough outside city and had no monetary value tothe Borough KIBC 16.60.060 requires additional approvalby the Borough Assembly prior to thevacation becoming effective Declaring Seat on the Solid Waste Advisory BoardVacant Leonard Roberson This item was approved under the consent agenda On July 22 2014 the Clerks Office received resignation letter from Mr Leonard Roberson who hadservedonthe Solid Waste Advisory Board since February 2012 Per KIBC 2.100.070A Vacancies it was necessary todeclarethe seatheld by Mr Roberson vacant and according to KIBC 2.100.070D the vacancy shouldbe advertised for new applicants for seat term to expire December 2015 EXECUTIVESESSION Borough Clerks Performance Evaluation LYNCH moved to convene into executivesession to discussthe Borough Clerks performance evaluation subject that qualifies for executive session as matter that may tend to prejudice her reputation or character ROLLCALLVOTE ON MOTIONCARRIEDUNANIMOUSLY Austerman Bonney Griffin KaplanLynch Peterson and Stephens Mayor Friend invitedthe Assembly members and Clerk to join in the executive session After the vote Mayor Friend recessed the regular meeting 838 p.m andconvened the executive session Upon returning from the executive session Mayor Friend reconvenedthe regular meeting at 845 pm No action was takenas result ofthe executive session CITIZENS COMMENTS Lisa Zeimer spoke tothe Assembly members running foroffice Betty MacTavish requested the repeal of Ordinance No FY2014-20 fl ASSEMBLYMEMBERS COMMENTS Assembly member Stephensspoke to Betty MacTavishs comments regarding Ordinance No FYI 4-20 Assembly member Bonney announced hewouldbe running for office again Kodiak Island Borough Assembly Regular Meeting Minutes August 2014 Page 1397 fltm\L1 Assembly member Austerman thanked SusanBrockman and Beverly Cole ofthe SCOK for their presentation andasked Manager Cassidy questionregarding the village CIP lists Assembly member Kaplan announced ho would be attending the Alaska Municipal League Conference in Nome AK He also thanked SusanBrockman and Beverly Cole ofthe senior center for their presentation Assembly member Peterson announced Warm August Nights and the Pink Salmon Derby both happening on August Assembly member Griffin spoke in support of the decorum and debateOrdinance No FY2014- 20 Assembly member Lynch announced the next Kodiak Fisheries Work Group regular meeting would be onAugust 13 2014 She also thanked SusanBrockman and Beverly Cole ofthe SCOK for their presentation Announcements Mayor Friend announced the Assembly would meet in Work Session immediately followed by Special Meeting on Thursday August 14 at 730 p.m in the Borough Conference Room The August 21 Regular Meeting was canceled The Mayor and members ofthe Assembly would meet with Congressman Don Young on Tuesday1 August 12 2014 from 315 p.m to 415 p.m in the Borough Conference Room ADJOURNMENT Li KAPLAN moved to adjourn the meeting ROLL CALL VOTE ON MOTION CARRIED UNANIMOUSLY Bonney Griffin Kaplan Lynch Peterson Stephens and Austerman The meeting was adjourned at 901 p.m KODIAK ISLA OUGH ATTEST ol Frieng4Aayor No Javier ugh Clerk Approved on October 16 2014 Kodiak Island Borough Assembly Regular Meeting Minutes Augustl 2014 Page 1398 IPublishers Affidavit UNITED STATES OF AMERICA State of Alaska ss NQV13L flfllAK ISLAND tk the undersig sworn depose and say am Editor or Publisherof the Kodiak Daily Mirror daily newspiper published in Kodiak Third Judicial Division State of Alaska and that theannexed printed notice was published in said newspaper in issues of the following dates_qL x_ Signature of Editor orPublisher SUBSCRIBEDAND SWORN to before me this day ofN 2Oj NOTARY PUBLIC in and for theState of Alaska iIy Commission xpiriJ/7J2 UNITED STATES OF AMERICA State ofAlaska RECEiED iv 212014 KODtAK ISLAND BOROUGHSS Bay Rd Kodiak AK 99615 the undersigned being first duly sworn depose and say am Editor or Publisher of the Kodiak Daily Mirror daily newspiper published in Kodiak Third Judicial Division State of Alaska and that the annexed printed notice was published in said newspaper in issues of the following dates Signature of Editor or Publisher SUBSCRIBED AND SWORN to before me this day of _________ NOTARY PUBLIC iii and for theState of Publishers Affidavit -.--201Y Alaska My Commission expires//7ILL 54 sas _____ OFRCAL BALLOT KODAK ISLAND BOROUGH ALASKA General Municipal Election TUESDAY OCTOBER 2014 INSTRUCTIONS To vote III in the oval tothe leftof your choice PROPOSITION NO.1 GENERAL OBUGAIONP11iQ3OOOO Shallthe Kodiak Island Borough incur debt and issue general obligation bonds in an amount notto exceedTen Million Two Hundred Thirty thousand Dollars $10230000 for the purpose of paying thecost ofschool facilities renewaland replacement projects which are 70% reimbursable by theStateof Alaska that address worn out building components suchas roofs floors underground storage tanks etc that have reached the end of their useful life including without limitation the projects describedbelow and other related projects PROJECT NAME COST Kodiak MiddleSchool Underground Storage Tank Replacement 150000 East Elementary School flooring Replacement 649000 Paterson Elementary School Flooring Replacement 363500 PortLions SchoolUndergroundStorage Tank Replacement 200008 Main Elementary School Underground Storage TankReplacement 150000 Kodiak Middle School New Elevator Controls 54000 KodiakMiddle School New HVAC Heating Controls 1576200 Peterson Elementary School New HVAC Heating Controls 694900 KodiakMiddleSchoolRoar Parking Lot Paving 675800 East Elementary School Cafeteria RootReplacement 1248500 Ouzinkie SchoolOld Wing Flooring Replacement 160300 OuzinkieSchool New Wing Flooring Replacement 41000 AkhiokSchool Flooring Replacement 95500 KodiakMiddleSchool Fire Alarm Replacement 405000 East Elementary School Partial interior Renovation 687200 Peterson Elementary SchoolParking Lot Paving 972000 KodiakMiddle SchoolBus Ramp Roof Replacement 118800 Peterson Elementary School Replacement of Boilers 324600 Main Elementary School Gym Floor Replacement 450000 Karluk School Flooring Replacement 86700 Chiniak School PlaygroundEquipment Replacement 101280 Kariuk School Playground Equipment Replacement 101200 AkhiokSchool Playground Equipment Replacement 101200 East Elementary School Replacement of Plumbing Fixtures 256500 Old Harbor School Playground Equipment Replacement 121500 OuzinkieSchool Playground Equipment Replacement 121500 PortLions SchoolPlayground Equipment Replacement 121500 Old Harbor School Underground Storage Tank Replacement 202400 Project Totals 10230000 70%State Reimbursement 7161000 30%Local Contribution 3069800 NO The projects are expected to qualify for not less than 70%State debt service reimbursement funding for which is subject to annual appropriation The projects will bescheduledas such to limit disruption tothe education of students andbonds will be sold only as needed to pay project costs It the Slate fully funds the debt service reimbursement program the average annual debt service payableby the Borough afterState reimbursement is estimated to be $353569 This amount of debt service may require an additional annual property tax levy of $84 per $250000 of assessedvalue or its equivalent This example of property tax levy is provided forillusirative purposes only The bonds shall besecured bypledge ofthe full faith and creditof the Borough Ordinance No FY20102 PLEASEVOTE BOTH S1DES OFTHE BALLOT 5145 8ACK CardSEOII __ vii1 Ma1k10P%Cs tIII1RI BOROUGH ASSEMBLY Vote for not more than THREE TEST For three-year terms Dan Rohrer BrendaSchwantes Larry LeDoux David Kaplan Tuck Bonriey Rebecca Skinner fl JaschaZthtnoff SCHOOLBOARD Vote for not more than TWO For three-year terms Duncan Fields Jeff Stewart KatieOliver PLEASEVOTEBOTH SIDES OF THE BALLOT FRONT Unz SEQ// 10 ii 12 13 14 15 16 18 19 20 21 22 23 24 25 26L. 27 28 29 30 31 32 33 34 COST 150000 649000 363500 200000 150000 54000 1576200 694900 675800 1248500 160300 41000 95500 405000 687200 972000 Kodiak Island Borough Alaska Resolution No FY2015-12 Page of Introduced by Requested by Drafted by Introduced on Adopted on Borough Assembly Borough Assembly Borough Clerk 10/1612014 10/16/2014 KODIAK ISLAND BOROUGH RESOLUTION NO FY2015-12 RESOLUTION OF THE ASSEMBLY OF THE KODIAK ISLAND BOROUGH RATIFYING AND CERTIFYING THERESULTSOFTHE MUNICIPAL ELECTIONHELD ON OCTOBER 2014 WHEREAS theKodiak Island Borough held Regular Election on October 2014 at which time candidates for the following offices were voted on BoroughAssembly SchoolBoard Bay View Road Service AreaBoard Fire Protection Area No Board Monashka Bay Road Service Area Board Service Area No Board Womens Bay Service AreaBoard Three Seats ThreeYearTerms Two Seats ThreeYearTerms One Seat ThreeYear Term Two Seats ThreeYear Terms One Seat ThreeYear Temi Three Seats ThreeYearTerms Three Seats ThreeYearTerms WHEREAS the proposition below was submitted to the qualified voters in the Kodiak Island Borough Proposition No.1 Shallthe Kodiak Island Borough incur debt and issue generalobligation bonds In an amount not to exceed Ten Million Two Hundred Thirty thousand Dollars $10230.000 for the purpose of paying thecostofschool facilities renewal and replacement projects which are 70% reimbursable by the State of Alaska that address worn out building components suchas roofs floors underground storage tanks etc that have reached the end of their useful life including without limitation the projects describedbelow and otherrelated projects 35 PROJECT NAME 36 KodIakMiddleSchool UndergroundStorage Tank Replacement 37 East Elementary School Flooring Replacement 38 Peterson Elementary School Flooring Replacement 39 Port Lions School UndergroundStorage Tank Replacement 40 Main Elementary School UndergroundStorage Tank Replacement 41 KodiakMiddleSchool New Elevator Controls 42 KodiakMiddleSchool New HVAC Heating Controls 43 Peterson Elementary School NewHVAC Healing Controls 44 KodiakMiddleSchoolRear Parking Lot Paving 45 East Elementary School Cafeteria Roof Replacement 46OuzinkleSchoolOld Wing Flooring Replacement 47Ouzinkle School New Wing Flooring Replacement 48 AkhiokSchool Flooring Replacement 49KodiakMiddleSchool Fire Alarm Replacement 50 East Elementary School Partial lnteri9r Renovation 51 Peterson Elementary School Parking Lot Paving 52 Kodiak Middle School Bus Ramp Roof Replacement 118800 53 Peterson Elementary School Replacement ofBoilers 324600 54Main Elementary School Gym Floor Replacement 450000 55 Karluk School Flooring Replacement 66700 56 Chiniak School PlaygroundEquipmentReplacement 101200 57 Karluk School PlaygroundEquipment Replacement 101200 58AkhiokSchool Playground EquipmentReplacement 101200 59 East Elementary School Replacement of Plumbing Fixtures 256500 60 OldHarbor School PlaygroundEquipment Replacement 121500 61 Ouzinkle School PlaygroundEquipment Replacement 121500 62 PortLions School Playground EquipmentReplacement 121500 63 Old Harbor School UndergroundStorage Tank Replacement 202400 64 Project Totals 10230000 65 70%State Reimbursement 7161000 66 30%Local Contribution 3069000 67 68 Yes 69 No 70 The projects are expected to qualify for not less than 70%State debt service reimbursement 71 funding for which is subject to annual appropriation The projects will be scheduled as such to 72 limit disruption to the educationof students and bonds will be sold only asneeded to pay project 73 costs If the State fully funds the debtservice reimbursement program the average annual debt 74 service payable by the Borough after State reimbursement is estimated to be $353569 This 75 amount of debt service may require an additional annual property tax levy of $84 per $250000 76 of assessedvalue or its equivalent This example of property tax levy is provided for 77 illustrative purposes only The bonds shall be secured by pledge of the full faith and credit of 78 the BoroughOrdinance No FY2015-02 79 80 WHEREAS the Canvass Board ofthe Kodiak Island Borough met on October 14 and 15 81 2014and tallied the votesas follows 82 83 BOROUGH ASSEMBLY THREE SEATS THREE YEAR TERMS Tuck Bonney David Kaplan Larry LeDoux Dan Rohrer BrendaSchwantes Rebecca Skinner Jascha Zbitnoff Z2 84 85 SCHOOL BOARD TWO SEATS THREEYEARTERMS Duncan Fields Katie Oliver 1319 Jeff Stewart 552 86 87 BAY VIEW ROAD SERVICE AREA BOARDONE SEAT THREEYEAR TERM Reed Oswalt write-in 88 Kodiak Island Borough Alaska Resolution No FY2015-12 Page of 89 FIRE PROTECTION AREA NO.1 BOARD TWO SEATS THREEYEARTERMS Scott Arndt 495 Richard Carstens 90 91 MONASHKABAY ROAD SERVICEAREA BOARDONE SEAT THREEYEARTERM Andy Dano write-in 92 93 SERVICE AREA NO BOARD THREE SEATS1 THREEYEARTERMS Scott Arndt 407 MikeSirofchuck 41 William TMBiII Mann write-in .. 94 95 WOMENS BAY SERVICE AREA BOARD THREE SEATS THREEYEARTERMS Dave Heuman 156 John Isadore 14 George Lee 162 96 97 PROPOSITION NO GENERAL OBLIGATION BONDS Yes No 630 98 99 PERCENTAGES Precinct TotalReulsteredVoters Votes Cast Percentaq 32/800-Chlnlak 135 36 27% 32/810-Flats 1711 186 11% 32/815-Kl South Larsen Bay 198 37 19% 32/820-Kodiak No 1741 350 20% 32/825-Kodiak No 1702 272 16% 321830-Mission Road 3148 709 23% 321835-Old Harbor 133 30 23% 32/840-Ouzlnkie 134 45 34% 32/845-Port Lions 198 34 17% AbsenteeQuestioned and Personal RepresentatIve 9100 269 3% TOTALS 9100 1968 22% Voter turn-out October 2013 17% Voter turn-out October 2012 13% 100 to 102 103 104 105 106 Kodiak Island Borough Resolution No FY2015-12 Page of 110 Ill 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 107 NOW THEREFORE BE IT RESOLVED BYTHE ASSEMBLY OFTHE KODIAK ISLAND 108 BOROUGH THAT the Assembly finds thatthe Municipal Election of October 2014 was 109 validly held and hereby ratifies and certifies theresults ofthe election Section In the Borough-wide election for Assembly Dan Rohrer Larry LeDoux and Rebecca Skinner were electedtothree year terms each Section In the Borough-wide election for Borough School Board1 KatieOliver and Duncan Fields were electedtothree year terms each Section In the Bay ViewRoad Service Area Reed Oswalt write-in candidate was elected to three year term Section In the FireProtection Area No Scott At and RichardCarstens were electedtothree year terms each Section In the Monashka Bay Road Service Area Andy Dano write-in candidate was electedtothree year term Section In the ServiceArea No Scott Arndt andMike Slrofchuck were elected to three year terms each The third seat will be tilled by William Bill Mann write-in candidate for three year term Section In the Womens Bay Service Area Board Dave Heuman John Isaclore and George Leewere elected tothree year terms each Section In the Borough-wide election for Proposition No the proposition passed NOW THEREFORE BE IT FURTHER RESOLVED BYTHE ASSEMBLY OFTHE KODIAK ISLAND BOROUGH THAT theelection was validly held and thattheclerk is directedtodeliver to each person elected to office certificate of election ADOPTED BY THEASSEMBLYOFTHE KODIAK ISLAND BOROUGH THISSIXTEENTH DAYOF OCTOBER 2014 ArrEST Nova Javier MM/Borough Clerk Eli KODIAK IS OUGH Resolution No FY2O1 5-12 Page of Kodiak island Borough Publishers Affidavit UNITED STATES OF AMERICA State of Alaska SS the undersigned being first duly sworn depose and say am Editor or Publisherof the Kodiak Daily Mirror daily newspaper published in Kodiak Third Judicial Division State of Alaska and that the annexed printed notice was published in said newspaper in issues of the following dates //g Iitt Signature of Editor or Publisher SUBSCRDWD AND SWORN to before me thiN day of Lk .211 ----- NOTARY PUBLIC in and for the Sla1 of Alaska My Commission expires.JL1 KODIAK ISLAND BOROUGH Assembly RegularMeeting October 16 2014 regular meeting ofthe Kodiak Island Borough Assembly was held onOctober 16 2014 in the Assembly Chambers ofthe Kodiak Island Borough Building 710 Mill Bay Road The meeting was called to order at 730 p.m The invocation was given by Major MichaelBates of the Salvation Army Mayor Friendledthe Pledge of Allegiance Presentwere Mayor Jerrol Friend Assembly members Carol Austerman Tuck Bonney Dave Kaplan Chris Lynch Frank Peterson Jr and Mel Stephens Also present were Borough Manager Bud Cassidy Clerk Nova Javier and Deputy Clerk Jessica Kilborn PETERSON moved to excuse Assembly member Griffin who was absentdue to personal leave VOICE VOTE ON MOTIONCARRIED UNANIMOUSLY APPROVAL OF AGENDA ANDCONSENTAGENDA KAPLAN moved to approve the agenda andconsent agenda VOICE VOTE ON MOTIONCARRIED UNANIMOUSLY APPROVAL OFMINUTES Regularmeeting minutes of August and September 182014 were approved under the consent agenda AWARDS AND PRESENTATIONS Manager Cassidy presented the Employee of the Quarter Award for the third quarter of 2014 to John Rhines PC Technician II in the IT department Manager Cassidy presented five-year longevity award to Marilyn Ordal Projects Assistant in the Engineering and Facilities department Mayor Friend proclaimed October 18 2014 asCoast Guard Appreciation Day in Kodiakand urged citizens to recognize theCoast Guard community for their individual and collective efforts in making Kodiak and all the navigable waters of Alaska safer and better place to live work and play Mayor Friend proclaimed the month of October as Fire Prevention Month and encouraged all citizenstotest their smoke alarms atleast every monthand to support the many safety activities and effortsofthe Borough fire and emergency services during the month Kodiak Island Borough Assembly RegularMeeting Minutes October 16 2014 Page 1419 CITIZENS COMMENTS JudyKidderspoke tothe Clean-up Kodiak Groups clean-up efforts on October 11 in the Hillside area COMMITTEEREPORTS Assembly member Peterson reported on his visitto the community of Karlukas the Assembly liaison Assembly member Lynch reported on theNorthPacific Fishery Management Council meetings held in Anchorage the week of October Sheannounced thenext Kodiak Fisheries Workgroup meeting was scheduledon Wednesday October 29 at 830 a.m in the Borough Conference Roam Assembly member Austerrnan reported on the ProvidenceHealth System ServiceAreaBoard meeting held on Wednesday October 15 Her report includedthe activities of the boardand the hospital and spoke on Providences drug-free initiative andEbola epidemicpreparedness efforts PUBLIC HEARING None BOROUGH MANAGERS REPORT Manager Cassidy reported on letter of support for the Kodiak Island Trails Group towards marine debris clean-up efforts on Near Island MESSAGES FROM THE BOROUGHMAYOR Mayor Friend thanked the Clean-Up Kodiak group for its efforts on cleaning up the Hillside area in ordertoalleviate the bear issues UNFINISHED BUSINESS None NEW BUSINESS Contracts None Resolutions Resolution No FY2015-08 Authorizing the Records Manager to Dispose of Certain Kodiak Island Borough Records LYNCH moved to adopt Resolution No FY2015-OB Kodiak Island Borough Assembly Regular Meeting Minutes October 16 2014 Page 1420 The Kodiak Island Borough Code 2.40.1608 provided for the Assembly to authorize by resolution the disposal ofthe records to be destroyed The annual recorddestruction process was followed whichincluded department directors reviewing and authorizing thedestruction of the specific records provided review by the borough attorney and final authorization by the Borough Assembly The Borough Attorney foundnorecordson the lists provided to haveunusual legal administrative or historical interest ROLLCALLVOTE ON MOTIONCARRIEDUNANIMOUSLY AustermanBonney Kaplan Lynch Peterson and Stephens Resolution No FY201512 Ratifying and Certifying theResults ofthe Municipal Election HeldonOctober 2014 KAPLAN moved to adopt Resolution No FY2015-12 The Regular Municipal Election was held on Tuesday OctoberPer Borough code allowance of at least weekwas given toreceive all election precinct certificates and other absentee by mailballots TheCanvass Boardmet in public session on Tuesday October 14 and Wednesday October 15 to canvass the election Upon certificationof the election by the canvass board the Resolution was provided tothe Assembly andwasmade availabletothe public ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY BonneyKaplan Lynch Peterson Stephens and Austorman Ordinances for Introduction None OtherItems Approval of Vacation of Twenty-Five Foot WideRoad and Utility Easement and Twenty Foot Wide Utility Easement on Lot 2A Block Monashka Bay Subdivision LYNCH moved to approve the vacation of twenty-five foot wideroad and utility easementand twenty-foot wide utihty easement on Lot 2A Block Monashka Bay Subdivision At its regular meeting of September 17 2014 the Planning and Zoning Commission granted preliminary approval of replat that would create Lots 2A and 218 Block Monashka Bay Subdivision The Commissions actionincluded approval of vacation of twenty-five foot wide road and utility easement and twenty-foot wide utility easement on Lot 2A The easements contained no roadways or utilities andserved no practical purpose No review agency or affected property owner expressed need to retain either ofthe easements Kodiak Island Borough Assembly RegularMeeting Minutes October 162014 Page 1421 The areas to be vacatedwere outsidethe City of Kodiakand had nomonetary value to the Borough K1BC 16.60080 required approvalby the Borough Assembly prior tothe vacations becoming effective ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY KaplanLynch Peterson Stephens Austerman and Bonnoy Administration of Oath of Office to Newly Elected Officials Clerk Javier administered the Oath of Officeto newly elected Assembly members Larry LeDoux Dan Rohrer and Rebecca Skinner Presentation to Outgoing Assembly Members Mayor Friend presented appreciation certificates to outgoing Assembly members Tuck Bonney Dave Kaplan and Mel Stephens CITIZENS COMMENTS Judi KidderandDennis Symmons congratulated the incoming Assembly members ASSEMBLY MEMBERS COMMENTS Assembly members Austerman and Lynch congratulated Employee ofthe Quarter award recipient John Rhines Assembly member Peterson thanked the outgoing Assembly members Assembly member congratulated five-year longevity award recipientMarilyn Ordal thanked the outgoing assembly members and welcomed the incoming Assembly members Assembly member Kaplan thanked the community for the opportunity to serveas an Assembly member for the past six years and welcomed the incoming Assembly members Assembly member Bonney thanked the community and voters for the support during thefour terms he served on the Assembly Assembly member Stephens commented on local government Announcements Mayor Friend The next Assembly worksessionwould be held on Thursday October 30 at 730 p.m in the Borough Conference Room The next regular meeting was scheduled on Thursday November at 730 p.m in the Borough Assembly Chambers The General Election would be held on Tuesday November 2014 If voters would be out of town on Election Day absentee voting was available Monday October 20 through Monday November a.m to p.m in the Borough Clerks Office Room 101 in the Borough building Kodiak Island Borough Assembly Regular Meeting Minutes October 16 2014 Page 1422 Th ADJOURNMENT KAPLAN moved to adjourn the meeting ROLL CALL VOTE ON MOTIONCARRIED UNANiMOUSLY Lynch Peterson Stephens AustermanBonney and Kaplan The meeting was adjourned at 816 p.m KODIAI4SLAND BOROU errol Friend Mayor Approved on December2014 Kodiak Island Borough October 16 2014 Assembly RegularMeeting Minutes Page 1423 Introduced by BoroughManager Requested by Finance Director Drafted by Bond Counsel Introduced on 08/20/2015 Adopted on 08/20t2015 KODIAK ISLAND BOROUGH RESOLUTION NO FY2016-06 RESOLUTIONOFTHE KODIAK ISLAND BOROUGH ASSEMBLY AUTHORIZINGTHE BOROUGH TO ISSUE GENERAL OBLIGATION SCHOOL BONDS IN THE PRINCiPAL AMOUNT NOT TO EXCEED $10230000 TO FINANCE THE RENEWAL ANDREPLACEMENT SCHEDULERELATEDTO BOROUGH-OWNED SCHOOL FACILITIES 10 PROJECTS WHICHARE 70%REIMBURSABLE BYTHESTATEOF 11 ALASKA AND TO PAY COSTS OF ISSUING THE BONDS EIXING 12 CERTAIN DETAILS OFSUCH BONDS AUTHORIZING THEIR SALE 13 AND PROVIDING FOR RELATED MATTERS 14 15 WHEREAS pursuant to Ordinance No FY2015-02 ofthe Kodiak Island Borough Alaska the 16 Borough adoptedAugust 2014 question whether the Borough should Issuenot to exceed 17 $10230000 in general obligation bonds for the purpose of paying the cost ofthe renewal and 18 replacement schedule relatedto Borough-owned school facilities projects which are 70% 19 reimbursable by theStateof Alaska referredto the regular Borough election held on October 20 2014 as Proposition No Proposition was passed and approved and 21 22 WHEREAS the Assembly findsthat it is in the best interest of the Borough to carry out the 23 Projects defined below and to issue notto exceed $10230000 principal amount of general 24 obligation bonds referredto in Proposition to pay part ofthe costs of the Projects and costsof 25 issuing the bonds and 26 27 WHEREAS the Borough will not issue the bonds until the Boroughs school district receives 28 notice from theStateof Alaska Department of Education Early Development Divisionof School 29 Finance thatthe bonds are approved for 70%reimbursement and 30 31 WHEREAS the bonds will not be sold if thetrueinterest cost is over four percent 4%and 32 33 WHEREAS Section 29.47.410 of theAlaska Statutes provides thatthe Assembly by resolution 34 may provide for the form and manner of safe of bondsand notes and 35 36 WHEREAS the Assembly finds that it is necessary and appropriate to delegate to each of the 37 Borough Manager and Borough Finance Director authority to determine the maturity amounts 38 interest rates and other detailsof the b9nds and to determineothermailers thatare not provided 39 for in this resolution including without limitation whether to sell the Bonds tothe Alaska Municipal 40BondBank the Bond Bank or another Financial Institution or toofferthe Bonds at public sale 41 42 NOW THEREFORE BE IT RESOLVED BYTHE ASSEMBLY OF THE KODIAK ISLAND 43 BOROUGH THAT 44 45 SectIon Definitions In additionto terms whicharedefined In the recitals above the 46 following terms shall have the following meanings inthis Resolution 47 48 Assembly means the Assembly of the Kodiak Island Borough as the 49 general legislativeauthority ofthe Kodiak Island Borough as the same shall be 50 duly and regularly constituted from time to time 51 KodiakIsland Borough Alaska Resolution No FY2016-06 Page 10111 52 Bond or Bonds means any of the General Obligation School Bond5 53 ofthe Kodiak Island Borough the Issuance and saleof whichare authorized 54 herein 55 56 uBond Bank means the Alaska Municipal BondBank publlc 57 corporation oftheStateof Alaska 58 59 Bond Bank Bondsmeans the series of general obligation bondsissued 60 by the Bond Bank all or part ofthe proceeds of whichareused to purchase the 61 Bonds 62 63 Bond Register means the registration books maintained by the 64 Registrar which Includethe names and addresses ofthe Registered Owners of 65 the Bonds ortheir nominees 66 67 Borough means the Kodiak Island Borough municipal corporation of 68 the Stateof Alaska organized assecond class borough under Title 29 ofthe 69 Alaska Statutes 70 71 Borough Manager means the Manager or Administrative Official of the 72 Borough 73 74 Code means theInternal RevenueCode of 1986 as amended from 75 time to time together with all regulations applicable thereto 76 77 or Costs means the cost of planning designing acquiring 78 property for acquiringconstructing installing and equipping the Projects 79 including interest on the Bonds during the period of planning designing 80 acquiring property for acquiringconstructing installing and equipping the 81 Projects the cost whether Incurred by the Borough or by another of field surveys 82 and advance planning undertaken in connection withthe Projects properly 83 allocable to the Projects the cost of acquisition of any land or interesttherein 84 required as the site or sites ofthe Projects or for use in connection therewith the 85 cost of any indemnity and surety bondsand premiums on insurance incurred in 86 connection withthe Projects prior to or during construction thereof all related 87 direct administrative and inspection expenses whether incurred by the Borough 88 or by another in connection withthe Projects prior to or during construction 89 thereof and allocable portions of directcosts of the Borough legal fees costs of 90 issuance ofthe Bonds by the Borough including financing charges and feesand 91 expenses of bond counsel financial advisorsand consultants in connection 92 therewith the cost of any bondinsurance premium andbond ratings the costof 93 audits the cost of all machinery apparatus and equipment cost of engineering 94 architectural servicesdesignsplans specifications and surveys estimates of 95 cost the reimbursement of all moneys advanced from whateversource for the 96 payment of any Itemor items of cost ofthe Projects and all other expenses 97 necessary or Incidental to the acquisition and development of the Projects the 98 financing thereof and the putting ofthe same In useand operation 99 100 Financial Institution means any bank or otherfinancial institution 101 insured by the Federal Deposit Insurance Corporation orthe FederalSavings 102 andLoanInsurance Corporation 103 104 Government Obligations means obligations that are eitherdirect 105 obligations ofthe UnitedStates of America or ii obligations of an agency or 106 instrumentality ofthe UnitedStates of America the timely payment ofthe KodiakIsland Borough Alaska Resolution No FY2016-06 Page of 11 107 principal of and interest on which areunconditionally guaranteedby theUnited 108 States of America 109 110 Loan Agreement means the Loan Agreement between the Borough 111 and the BondBank orotherFinancialInstitution concerning the Bonds 112 113 Projects means collectively the cost of school facilities renewaland 114 replacement projects that addresswornout building components such as roofs 115 floors undergroundstorage tanksetc that havereached the end of their useful 116 life including without limitation the followingprojects and otherrelated projects 117 KodiakMiddleSchool undergroundstorage tank replacement new elevator 118 controls new HVAC heating controls rear parking lot paving fire alarm 119 replacement andbus ramp roof replacement East Elementary School flooring 120 replacement cafeteria roof replacement partial interior renovation and 121 replacement of plumbing fixtures Peterson Elementary School flooring 122 replacement new HVAC heating controls parking lot paving and replacement 123 of boilers Fort Lions School undergroundstorage tank replacement and 124 playground equipmentreplacement Main Elementary School underground 125 storage tank replacement and gym floor replacement Ouzinkie School old wing 126 flooring replacement new wing flooring replacement and playgroundequipment 127 replacement AkhiokSchool flooring replacement and playgroundequipment 128 replacement KarlukSchool flooring replacement and playgroundequipment 129 replacement Chiniak School playground equipmentreplacement and Old 130 Harbor School playground equipmentreplacement and underground storage 131 tank replacement 132 133 Registered Owner means the person named as the registered owner of 134 Bond in the Bond Register 135 136 Registrr means the Borough Finance Director or any successor that 137 the Borough may appointby resolution 138 139 Resolution means this Resolution No FY2016-_of the Borough 140 141 Section Authorization of Bonds and Purpose of IssuanceFor the purpose of providing 142 funds for financing the Costs ofthe Projects the Borough shall issue and sell 143 general obligation bonds designated Kodiak Island Borough Alaska General 144 Obligation School Bonds the Bonds in the aggregate principal amount ofnot 145 to exceed $10230000 The proceeds of the Bonds shall be used to pay Costs 146 of the Projects The Projects serve public purpose ofthe Borough 147 148 The Manager and/or the Finance Director are hereby authorized to determine 149 whether the Bonds shall be soldtothe BondBank or Financial Institution or 150 soldat public sale andwhether to issuethe Bonds in one or more issues but in 151 no event shallthe aggregate principal amount of the Bonds exceed $10230000 152 153 The Borough will notissuethe bonds until the Boroughs school district receives 154 notice from theStateof Alaska Department of Education Early Development 155 Divisionof School Finance thatthe bonds are approved for 70%reimbursement 156 KodiakIsland Borough Alaska Resolution No FY2016-06 Page of 11 157 Section Obligation of Bonds TheBonds shall be direct and general obligations of the 158 Borough and the full faith and credit of the Borough are herebypledged to the 159 payment ofthe principal of and interest on the Bonds The Boroughhereby 160 irrevocably pledges andcovenants that it will levy and collecttaxes upon all 161 taxable property withinthe Borough without limitation as torate or amount in 162 amounts sufficient together withother funds legally available therefor to pay the 163 principal of and interest on the Bonds as the same becomedueand payable 164 165 Section Designation Maturities Interest Rates and Other Details of Bonds The Bonds 166 shall be designated Kodiak Island BoroughAlaska General Obligation School 167 Bonds TheBonds shall be in the denomination of $5000 or any integral 168 multiple thereof shall be numbered separately In the manner and with such 169 additional designation as the Registrar deems necessary for purposes of 170 identification and may haveendorsed thereon such legends ortext as may be 171 necessary or appropriate to conform tothe rules and regulations of any 172 governmental authority or anyusage or requirement of law with respect thereto 173 174 The Bonds shall mature in one or more years commencing no earlier than 2015 175 and ending no later than 20 TheBonds shall bear interest from their date 176 payable commencing on dateon or after 2QJ and semi-annually 177 thereafter Interest will be computed on thebasis of 360-day year consisting of 178 twelve 30-day months 179 180 Subject to Section and the remainder of this Section the dated date the 181 princIpal and interest payment dates the recorddates for interest payments the 182 aggregate principal amount the principal amount of each maturity and the 183 interestrates on the Bonds shall bedetermined atthe time of execution of the 184 Loan Agreement ator before public sale of the Bonds underSection 17 185 186 Section Optional Redemption The Bonds if any subject to optional redemption by the 187 Borough the time ortimes when such Bonds are subject to optional redemption 188 the terms upon whichsuch Bonds may be redeemed andthe redemption price 189 or redemption prices for such Bonds shall be determined atthe time ofsaleof 190 the Bonds by the Borough Manager or Finance Director 191 192 Section Selectionof Bonds for Redemption Notice of Redemption 193 194 Selectionof Bonds for Redemption When and if the Bond Bank or 195 FinancialInstitution is the Registered Owner ofthe Bonds theselectionof Bonds 196 to be redeemed shall be made as provided in the Loan Agreement When and if 197 the BondBank or Financial Institution is not the Registered Owner of the 198 Bonds theselectionof Bonds to be redeemed shall be made as provided in this 199 subsection If the Borough redeems at any one time fewerthan all of the 200 Bonds having the same maturity date the particular Bonds or portions of Bonds 201 of such maturity to be redeemed shall beselected by lot or in such other manner 202 determined by the Registrar in increments of $5000 In the case of Bond of 203 denomination greater than $5000 the Borough shall treat such Bond as 204 representing such number of separate Bonds each of the denomination of $5000 205 as is obtained by dividing theactual principal amount of such Bond by $5000 In 206 the event that onlyportion of the principal amount of Bond Is redeemed upon 207 surrender of such Bond attheofficeofthe Registrar there shall be issued to the 208 Registered Owner without charge therefor for the then unredeemed balance of 209 the principal amount thereof at the option ofthe Registered Owner Bond or 210 Bonds of like maturity and interestrate in any of the denominations authorized 211 herein 212 KodiakIsland Borough Alaska Resolution No FY2016-06 Page 0111 213 Noticeof Redemption When and if the BondBank or Financial 214 Institution is the Registered Owner of the Bonds notice of any intended 215 redemption of Bonds shall be given as provided In the Loan Agreement When 216 and if the BondBank or FinancialInstitution is notthe Registered Owner of the 217 Bonds noticeof any intended redemption of Bonds shall be given as provided in 218 this subsection Noticeof redemption shall bemailednot lessthan 20 or 219 more than45 days prior tothe date fixed for redemptionby first classmail to 220 Registered Owners ofthe Bonds to be redeemed at their addresses as they 221 appear on the Bond Register on the day thenotice is prepared Noticeof 222 redemption shall be deemed to have been given when thenotice is mailed as 223 herein provided whether or not it is actually received by the Registered Owners 224 All noticesof redemption shall bedatedand shall state the redemption date 225 the redemption price if fewerthan all outstanding Bonds are to be 226 redeemed the identification and in the case of partial redemption the 227 respectiveprincipal amounts ofthe Bonds to be redeemed that on the 228 redemption date the redemption price will becomedue and payable upon each 229 such Bond or portion thereofcalled for redemption and that interest thereon shall 230 cease to accrue from and after said date and the place where suchBonds 231 are to be surrendered for payment ofthe redemption price which place of 232 payment shall be theofficeofthe Registrar 233 234 Official noticeof redemptionhaving been given as stated above Bonds or 235 portions of Bonds to be redeemed shall on the redemption date become due 236 and payable atthe redemption price therein specified and from and after such 237 date such Bonds or portions of Bonds shall cease to bear interest Upon 238 surrender of such Bonds for redemption in accordance withsaid notice such 239 Bonds shall be paid atthe redemption price Installments of interest due on or 240 prior tothe redemption date shall be payable as herein provided for payment of 241 Interest All Bonds whichhave beenredeemed shall becanceledand destroyed 242 by the Registrar and shallnot be reissued 243 244 Each check or other transfer of fundsissued to pay the redemption price of 245 Bonds shall bear the CUSIP number if any identifying by maturity the Bonds 246 being redeemed withthe proceeds of suchcheck or other transfer 247 248 Section Form of Bond EachBond shall be in substantially the following form with such 249 variations1 omissions and insertions as may be required or permitted by this 250 Resolution 251 252 UNITED STATES OFAMERICA 253 254 KODIAK ISLAND BOROUGH ALASKA 255 256 NO $________ 257 258 GENERAL OBLIGATION SCHOOL BOND 259 260 REGISTERED OWNER 261 262 PRINCIPAL AMOUNT 263 264 The Kodiak Island Borough the Borough municipal corporation of 265 theState of Alaska herebyacknowledges itselfto owe and for value received 266 promises to pay to the Registered Owner identified above or its registered 267 assigns the principal amount identified above in the following installments on 268 each ofthe following years and to pay interest on such installments from the KodiakIsland Borough Alaska Resolution No FY2016-06 Page of 11 269 date hereof payable on 201_and semiannually thereafter on 270 and of each year attherates per annum as follows 271 272 MaturityPrincipal Interest 273 Date Amount Rate 274 275 276 277 When and if this Bond Is owned by the Alaska Municipal BondBank or 278 Financial Institution payment of principal and interest shall be made as provided 279 in the Loan Agreement between the BondBank or Financial Institution and the 280 Borough the Loan Agreement When and if this Bond is not owned by the 281 BondBank or Financial Institution installments of principal of and interest on 282 this Bond shall be paid by check or draft mailed by first classmail to the 283 RegIstered Owner as ofthe close of business on the 15th day of the month 284 beforeeach installment payment date provided that the final installment of 285 principal of and interest on this Bond shall be payable upon presentation and 286 surrender of this Bond by the Registered Owner atthe officeof the Registrar 287 Interest will be computed on thebasisof 360-day year consisting of twelve 30- 288 day months Both principal of and interest on this Bond are payable in lawful 289 money of the UnitedStates of America which on the respective dates of 290 payment thereof shall be legal tender for the payment of public and private 291 debts 292 293 This Bond is one ofthe General Obligation School Bonds of the Kodiak 294 Island Borough Alaska of like tenor and effect except as tointerest rate serial 295 number right of redemption or prepayment and maturity and constituting Bonds 296 authorized for the purpose of paying the cost of schooland related capital 297 improvements in the Borough and is issuedunderResolution No FY2016-_of 298 the Borough entitled 299 300 RESOLUTION OFTHE KODIAK ISLAND BOROUGH ASSEMBLY 301 AUTHORIZINGTHE BOROUGH TO ISSUE GENERAL OBLIGATION 302 SCHOOL BONDS IN ThE PRINCIPAL AMOUNT NOTTOEXCEED 303 $10230000 TOFINANCETHE RENEWALAND REPLACEMENT 304 SCHEDULERELATEDTO BOROUGH-OWNED SCHOOL FACILITIES 305 PROJECTS WHICH ARE 70%REIMBURSABLEBY THESTATEOF 306 ALASKA AND TOPAYCOSTSOF ISSUING THE BONDS FIXING 307 CERTAIN DETAILS OF SUCH BONDS AUTHORIZING THEIR SALE 308 AND PROVIDING FORRELATED MATTERS 309 310 the Resolution 311 312 TheBonds of principal of this Bond maturing on and after 313 ______20 shall be subject to prepayment on and after _____20_atthe 314 option ofthe Borough to any applicable provisions ofthe Loan 315 AgreementJ in such principal amounts and from such maturities as the Borough 316 may determine and by lot within maturity at redemption price equal to the 317 principal arnountto be prepaid plus accwed interest tothe date of prepaymeni 318 319 This Bond is transferable as provided in the Resolution only upon the 320 Bond Register of the Borough and ii upon surrender of this Bond together with 321 written Instrument of transfer duly executed by the Registered Owner or the 322 duly authorized attorney of the Registered Owner and thereupon new fully 323 registered Bond or Bonds In the same aggregate principal amount and maturity 324 shall be issued to the transferee in exchange therefor as provided in the KodiakIsland Borough Alaska Resolution No FY2OIG-06 Page 60111 325 326 327 328 329 330 331 332 333 334 335 336 337 338 339 340 341 342 343 344 345 346 347 348 349 350 351 352 353 354 355 356 357 358 359 360 361 362 363 364 365 366 367 368 369 370 371 372 373 374 375 376 377 378 379 /specimeni Borough Clerk Resolution No FY20 6-06 Page 70111 Resolutionand upon the payment of charges if any as therein prescribed The Borough may treat andconsider the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of or on account of the principal or redemption price ii any hereof and interest due hereonand for all other purposes whatsoever This Bond is general obligation ofthe Kodiak Island Borough and the full faith and creditof the Borough are pledged for the payment of the principal of and interest on this Bond as the same shall become due ITIS HEREBY CERTIFIED ANDRECITED that all conditions actsor thingsrequired by theconstitution or statutes of the State of Alaska to exist to have happened or to havebeen performedprecedent to or In the issuance of this Bond exist have happened andhave been performed and thattheseriesof Bonds of which this is one together with all other indebtedness ofthe Borough is within every debtand other limit prescribedby such constitution or statutes IN WITNESS WHEREOF THEKODIAK ISLAND BOROUGH ALASKA hascaused this Bond to be signed in its name and on its behalf by the manual or facsimile signature of its Mayor and its corporate seal or facsimile thereof to be impressed or otherwise reproduced hereonand attested by the manual or facsimile signature of its Clerk all as of the ____day of 2015 KODIAK ISLAND BOROUGH crr.Irf..i1 ATTEST Borough Mayor Section Exci.ttin TheBonds shall beexecuted in the name ofthe Borough by the manual orfacsimile signature ofthe Mayor and its corporate seal or facsimile thereof shall be Impressed or otherwise reproduced thereonand attested by the manual orfacsimile signature ofthe Borough Clerk The execution of Bond on behalf ofthe Boroughby persons who atthe time ofthe execution are duly authorized toholdthe proper officesshall be valid and sufficient for all purposes although any such person shall have ceased toholdofficeat the timeof delivery ofthe Bond or shall not have heldoffice on the date of the Bond Section Payment of Principal and Interest TheBonds shall be payable in lawful money ofthe UnitedStates of Americawhich atthe time of payment is legal tender for the payment of public and private debts When and if the Bond Bank or Financial Institution is the Registered Owner ofthe Bonds payment of principal of and Interest on the Bonds shall be made as provided in the Loan Agreement When and if the BondBank or FinancialInstitution is notthe Registered Owner ofthe Bonds installments of principal of and interest on the Bonds shall be paid by check mailed by first class mail to the Registered Owner as ofthe record date for the installment payment atthe address appearing on the Bond Register provided thatthe final installment of principal and interest on Bond shall be payable upon presentation and surrender ofthe Bond by the Registered Owner at the office of the Registrar Kodiak Island Borough Alaska 380 Section 10 Registration TheBonds shall be issued only in registered form as to both 381 principal and interest The Boroughdesignates the Borough Finance Director as 382 Registrar for the Bonds The Registrar shall keep or cause to be kept the Bond 383 Register atthe principal office of the Borough The Borough covenants that until 384 all Bonds have been surrendered and canceled it will maintain system for 385 recording the ownership of each Bond that complies withthe provisions of 386 Section 149 ofthe Code The Borough and the Registrar may treatthe person in 387 whose name any Bond shall be registered as the absolute owner of such Bond 388 for all purposes whether or not the Bond shall be overdue and all payments of 389 principal of and interest on Bond made to the Registered Owner thereofor 390 upon its order shall be valid and effectual to satisfy and discharge the liability 391 upon such Bond to theextentofthe sum or sums so paid and neitherthe 392 Borough nor the Registrar shall be affected by any notice to the contrary 393 394 Section Ii Transfer and Exchange Bonds shall be transferred only upon the Bond 395 Register Upon surrender for transferor exchange of any Bond at the office of 396 the Registrar together withwritten instrument of transfer or authorization for 397 exchange in form and with guaranty of signature satisfactory tothe Registrar 398 duly executed by the Registered Owner or the duly authorized attorney ofthe 399 RegIstered Owner the Borough shall execute and deliver an equalaggregate 400 princIpal amount of Bonds ofthe same maturity of any authorized denominations 401 subject to suchreasonable regulations as the Borough may prescribe and upon 402 payment sufficientto reimburse it for any tax fee or other governmentalcharge 403 required to be paid in connection with such transferor exchange All Bonds 404 surrendered fortransfer or exchange shall becanceled by the Registrar 405 406 Section 12 Bonds MutilatedDestroyedStolen or Lost Upon surrender to the Registrar of 407 mutilated Bond the Borough shall executeand deliver new Bond of like 408 maturity and principal amount Upon filing with he Registrar of evidence 409 satisfactory tothe Borough that Bond hasbeen destroyed stolen or lost and of 410 the ownership thereof and upon furnishing the Borough with indemnity 411 satisfactory to it the Borough shall execute and deliver new Bond of like 412 maturity and principal amount The person requesting the execution and delivery 413 of newBond under this section shall comply with such other reasonable 414 regulations as the Borough may prescribe and shall pay such expenses as the 415 Borough may incur in connection therewith 416 417 Section 13 Disposition of theSaleProceeds of the Bonds The sale proceeds ofthe Bonds 418 representing accrued interest on the Bonds shalt be applied to pay portion of 419 the interest dueon the Bonds on the first interest payment date for the Bonds 420 The sale proceeds ofthe Bonds representing original issue premium on the 421 Bonds shall be applied to pay portion of the interest due on the Bondson the 422 first interest payment date for the Bonds or Costs ofthe Projects and shall be 423 deposited in such manner as the Borough Manager or the Borough Finance 424 Director may determine The remaining sale proceeds of the Bonds shall be 425 applied to pay Costs ofthe Projects and shall be deposited in the appropriate 426 funds or accounts of the Borough for such purposes 427 KodiakIsland Borough Alaska Resolution No FY2OI 8-06 Page of 11 428 429 430 431 432 433 434 435 436 437 438 439 440 441 442 443 444 Section 14 Section 15 Tax Covenants The Borough covenants to comply with any and all applicable requirements setforth in the Code iii effect fromtime totime to theextent that such compliance shall be necessary for the exclusion oftheinterest on the Bonds from gross income for federal income tax purposes The Borough covenants that it will make nouse of the proceeds ofthe Bonds which will cause the Bonds to be arbitrage bonds subject tofederal income taxation by reason of Section 148 ofthe Code The Borough covenants that it will nottake or permit any actionthat wouldcause the Bonds to be private activity bonds as defined in Section 141 of the Code Amendatorv and Supplemental Resolujigns The Assembly from timetotime and at any time may adopt resolution or resolutions supplemental hereto which resolution or resolutionsthereafter shall become part of this Resolution for any one or more ofthe following purposes 445 446 447 448 449 450 451 452 453 454 455 456 457 458 459 460 461 462 463 464 465 466 467 468 469 470 471 472 473 474 475 476 477 478 479 480 481 482 To add to the covenantsand agreements of the Borough in this Resolution other covenants and agreements thereafter to be observed or to surrender any right or power herein reserved to or conferred upon the Borough Tomake such provisions for the purpose of curing any ambiguities or of curing correcting or supplementingany defective provision contained in this Resolution or in regard to matters or questions arising under this Resolutionasthe Assembly may deem necessary or desirable and not inconsistentwith this Resolution and which shallnot adversely affecttheinterestsofthe Registered Owners of the Bonds Any such supplemental resolution may be adopted without the consent of the Registered Owners of any of the Bonds at any time outstanding notwithstanding any ofthe provisions of subsection of this section With the consent of the Registered Owners ofnotless than 60 percent in aggregate principal amount ofthe Bonds atthe time outstanding the Assembly may adopt resolutionor resolutions supplemental hereto for the purpose of addingany provisions to or changing in any manner or eliminating any of the provisions of this Resolution orof any supplemental resolution provided however that no such supplemental resolution shall Extend thefixed maturity of any ofthe Bonds or reduce therate of interest thereon or extend the time of payments ofinterest from their due date or reduce the amount ofthe principal thereot or reduce any premium payable on the redemption thereof withoutthe consent of the Registered Owner of each Bond so affected or Reduce theaforesaid percentage of Registered Owners of Bonds required to approveany such supplemental resolutionwithoutthe consent of the Registered Owners of all of the Bonds then outstanding It shallnot be necessary for the consent ofthe Registered Owners of the Bonds under this subsection to approve the particular form of anyproposed supplemental resolution but it shall be sufficient if suchconsent approves the substance thereof Resolution No FY2016-06 Page of 11 KodiakIsland Borough Alaska 483 Upon the adoption of anysupplemental resolution under this section this 484 Resolution shall be deemed to be modified andamended in accordance 485 therewith and the respective rights1 duties and obligations under this Resolution 486 of the Borough and all Registered Owners of outstanding Bonds shallthereafter 487 be subject in all respects to such modification and amendment and all the terms 488 and conditionsofthe supplemental resolutionshall be deemed to be part ofthe 489 terms and conditionsof this Resolution for any and all purposes 490 491 Bonds executed and deliveredafterthe adoption of anysupplemental 492 resolution under this section ma bear notation as to any matter provided for in 493 such supplemental resolution and if such supplemental resolutionshall so 484 provide newBonds modified soas to conform In the opinion ofthe Borough to 495 any modification of this Resolutioncontained in any such supplemental resolution 496 may be preparedby the Borough and delivered withoutcost to the Registered 497 Owners ofthe Bonds then outstanding upon surrender for cancellationof such 498 Bonds in equalaggregate principal amounts 499 500 Section 16 Defeasance In the event money and/or non-callable Government Obligations 501 maturing at such times and bearing interest to be earnedthereon in amounts 502 sufficient to redeem and retire any or all of the Bonds in accordance with their 503 terms are set aside in special trust account to effect such redemption or 504 retirement andsuch moneys and the principal of and interest on such 505 Government Obligations are Irrevocably set aside and pledged for such purpose 506 then no further payments need be made to pay or secure the payment ofthe 507 principal of and interest onsuch Bonds andsuch Bonds shall be deemed not to 508 be outstanding 509 510 Section 17 Sale of Bonds TheBonds shall be soldat negotiated saletothe Bond Bank or 511 FinancialInstitution as provided in the form of Loan Agreement or at public sale 512 as the 8orough Manager andFinance Director determine is in the best interest of 513 the Borough Subject to the limitations provided in Sectionsandeach ofthe 514 Borough Manager and the Borough Finance Director is hereby authorized to 515 determine the aggregate principal amount maturity amounts interest rates 516 yields dated date principal and interest payment dates redemption terms if 517 any for the Bonds and other details of the Bonds provided thatthetrueinterest 518 cost ofthe Bonds expressed as an annual rate doesnot exceed 6.0 percent In 519 determining the maturity amounts interest rates yields and redemption terms if 520 any for the Bonds the Borough Manager or Borough Finance Directorshall take 521 into account those factors which in the judgment of each will result in the lowest 522 trueinterest cost on the Bonds to their maturity Including without limitation 523 currentfinancial market conditions and current interest rates for obligations 524 comparable in tenor and quality tothe Bonds Based upon the foregoing 525 determinations the Borough Manager and the Borough Finance Director each is 526 authorized to execute the Loan Agreement in substantially the form presented at 527 this meeting or to sell the Bonds at public sale as they deem appropriate and 528 cost effective to and in the best interest of the Borough 529 530 Section 18 Authority of Officers The Mayor the Borough Manager the Borough Finance 531 Director and the Borough Clerk each is authorizedand directedto doand 532 perform all things and determine all matters not determined by this Resolution to 533 the end thatthe Borough may carry out its obligations under the Bonds and this 534 Resolution 535 536 Section 19 Prohibited Sale of Bonds No person firm or corporation or any agent or 537 employee thereof acting as financial consultant tothe Borough under an 538 agreement for payment in connection with the saleofthe Bonds is eligible to KodiakIsland Borough Alaska Resolution No FY2016-06 Page 10 of 11 539 540 541 542 543 544 545 546 547 546 549 550 551 552 553 554 555 556 557 558 559 560 561 562 563 564 565 566 567 568 569 570 571 572 573 574 575 576 577 578 579 580 581 582 583 584 585 586 587 588 589 TSif h--A Resoution No FY2016-06 Page 11 ollI Section 20 Section 21 Section 22 Section 23 purchase the Bonds as member of the original underwriting syndicate either at public or private sale Onçioiriq Disclosure The Boroughacknowledges that underRule 5c2-1 of the Securities and Exchange Commission the RuI the Borough may now or in thefuture be an uobligated person In accordance withthe Rule andas the BondBank or Financial Institution may require the Borough shall undertake to provide certain annual Financial information and operating dataas shall be set forth in the Loan Agreement Miscellaneous All payments made by the Borough of or on account of the principal of or interest on the Bonds shall be madeon the several Bonds ratably and in proportion to the amountdue thereonrespectively for principal orInterest as the case may be No recourse shall be had for the payment of the principal ofor the interest on the Bonds or for any claim basedthereon or on this Resolution against any member ofthe Assembly orofficer ofthe Borough or anyperson executing the Bonds TheBonds are not and shall not be in any way debt or liability oftheStateof Alaska or of any political subdivision thereof except the Borough and do not and shallnot create or constitute an indebtedness or obligation either legal moral or otherwise of such state or of any political subdivision thereof except the Borough Severability If any one or more ofthe provisions of this Resolutionshall be declared by any courtof competent jurisdiction to be contrary to law thensuch provision shall be null and void and shall be deemed separable from the remaining provisions of this Resolutionand shall in no way affect the validity of the other provisions of this Resolution or ofthe Bonds Effective Date This Resolutionshall become effective upon passage and approval ADOPTED BY THE ASSEMBLY OFTHE KODIAK ISLAND BOROUGH THIS 1WENTIETH DAYOF AUGUST 2015 KODIAK ISLAND BOROUGH Jerrol Friend Borough Mayor N6va JavierMMCBorougClerk Kodiak Island Borough Alaska Publishers Affidavit UNITED STATES OFAMERICA State of Alaska SS the undersigned being first duly sworn depose and say am Editoror Publisherof the Kodiak Daily Mirror daily newspaper published in Kodiak Third Judicial Division State of Alaska and that the annexed printed notice was published in said newspaper in issues of the following dates i.i Signature of Editor orPublisher SUBSCRIBEDAND SWORN to before off212L Maska My Commission expires_h 7LL7 ARY PUBLIC in and for theState of KODIAK ISLAND BOROUGH Assembly RegularMeeting August 20 2015 regular meeting of theKodiak Island Borough Assembly was held on August 20 2015 in the Assembly Chambers ofthe Kodiak Island Borough Building 710 Mill Bay Road The meeting was calledtoorderat 730 p.m The invocation was givenbyMajor MichaelBates oftheSalvation Army Deputy Presiding Officerledthe Pledge of Allegiance Presentwere Assembly members Aaron Griffin Larry LeDoux Chris Lynch Dan Rohrer Rebecca Skinner andDennis Symmons Also present were Borough Manager Bud Cassidy Assessor Bill Roberts Engineering and Facilities Director Bob Tucker Finance DirectorKarl Short Borough Clerk Nova Javier and Deputy Clerk Jessica Kilborn GRIFFINmoved to excuse Mayor Jerrol Friend whowas attending the Alaska Municipal League Summer Meeting in Ketchikan and Assembly member FrankPeterson whowas absentdue to personal leave VOICE VOTE ON MOTION CARRIEDUNANIMOUSLY APPROVAL OF AGENDA GRIFFINmoved to approve the agenda VOICE VOTE ON MOTIONCARRIED UNANIMOUSLY APPROVAL OFMINUTES None AWARDSAND PRESENTATIONS Manager Cassidy presented the Employee ofthe Quarter Award for the second quarter of 2015 to Sharon Blakeslee Programmer/Analyst in theInformation Technology department Manager Cassidy presented ten-year Longevity Award to Tom Slagle Baler Operator at the Borough Landfill Manager Cassidy provided an update on the Managers Officetothe Assembly which consisted of education on local government duties and powers CITIZENS COMMENTS Judi Kidder spoke in support of Ordinance No FY2016-02 Borough Land Committee Kodiak Island Borough Assembly Regular Meeting Minutes August 20 2015 Page 1544 Ally Strongspoke on the drug and alcohol problems in the community and advocated for services to assistwiththe problems Mel Sterhens spoke against the Hiring of Resource Management Officer at salary higher than the Managers authority Wayne Aboussleman spoke in support of hiring Fire Chief for Bayside Fire Department Jonathan Strong representing the Senior Citizensof KodiakandKodiakArea Transit System thanked the Assembly for its support ofthe non-profitfunding and spoke on Resolution No FY20 16-04 COMMITTEE REPORTS None PUBLIC HEARING Ordinance No FY2016-02 Amending Title Administration and Personnel byAdding Chapter 2.160 Borough Lands Committee LEDOUX moved to adopt Ordinance No FY20 16-02 Clerks Note substitutedversionof Ordinance No FY2016-02 adding an Ex-Officio City Council representative was provided The Borough Lands Committee ordinance was requestedby Mayor Friend The Committee would be responsible for review of real propertyacquisition and disposal of borough land and it would also provide forum for input andrecommendations to the Assembly The powers and dutiesofthe Borough LandsCommitteewould be Assist in identifying creative andworkable solutionsto ongoing and emerging issues in selection acquisition management and disposal of borough real property and resources Provide input for potential landsale plans Provide input for utilization of borough land that achieves multiple land and housing options Collaborate and seek input with private land owners when considering whether borough land should be developed Provide for balanced consideration and representation ofthe viewpoints problems and issues regarding borough real property and resources Provideforum for discussing development of specific sites and projects LEDOUX moved to amend Ordinance No FY2016-02 by substitution ROLL CALL VOTE ON MOTIONTO AMEND CARRIED UNANIMOUSLY Griffin LeDoux Lynch Rohrer Skinnerand Symmons Deputy Presiding Officer Rohrer opened the public hearing Kodiak Island Borough Assembly Regular Meeting Minutes August 20 2015 Page 1545 Mel SteDhensspoke in opposition of Ordinance No FY2016-02 Scott Arndt spoke in support of Ordinance No FY2016-02 Deputy Presiding Officer Rohrerclosed the public hearing ROLL CALL VOTE ON MAIN MOTIONAS AMENDED CARRIED FIVE TO ONE LeDoux RohrerSkinner Symmons and Griffin Ayes Lynch No BOROUGH MANAGERS REPORT Manager Cassidy reported on the following NOAA lease extension for the Kodiak Fisheries ResearchCenter facility Community issuewiththe tack ofState drug enforcement officer Status on the hiring of Bayside Fire Chief Upcoming presentation atthenext worksession from Greatland Trust regarding timber rights at Termination Point and Long Island Alaska NativeTribalHealth Consortium presentation on its hospital management plan at the September 10 worksession MESSAGESFROM THE BOROUGHMAYOR Deputy Presiding Officer Rohrerannounced that Mayor Friend was representing the Borough at the Alaska Municipal League meeting in Ketchikan UNFINISHED BUSINESS Ordinance No FY201 5-11 Amending Various Sections in Title Revenueand Finance Chapter 3.40 Personal Property Tax Thisordinance was postponed from the May 21 2015 regular Assembly meeting The motion beforethe Assembly was to adopt Ordinance No FY2OI 5-11 Boats andvessels with an overall lengthlonger than20 feet measuredbow to stern andused for commercial purposes were currently taxed atrateof $1 per foot One purpose ofthetax was to track vessels for future ad valorem taxatiOn In additiontothevessel personal property tax the Borough collected both raw fish tax andseverance tax from the fishing fleet The taxrateof $1 per foot in tax did not provide enough funds to make theadministration and maintenance of these personal property accounts costeffective for the Borough therefore it was the Assessors recommendation to remove section 3.40.070 Classification of boats and vessels from the Borough Code ROLL CALL VOTE ON MOTION CARRIEDUANIMOUSLY Lynch RohrerSkinner Symmons Griffin and LeDoux Kodiak Island Borough Assembly Regular Meeting Minutes August 20 2015 Page 1546 NEW BUSINESS Contracts Contract No FY2016-15 LeachateTreatment Plant CarbonSource Chemicals Procurement LEDOUX moved to authorizethe Manager to executeContract No FY2016-15 with Environmental Operating Solutionsof Bourne MA for Micro-C2000 in an amount of $5.25 per gallon and not to exceed $136000 per year for the term ofthe contract Thenew LeachateTreatment Plant LIP required severaldifferent chemicals totreatleachate and cleanthe Membrane Bioreactor MBR system One ofthe required chemicals was carbonsourcewhichactedas food for the micro-organisms that digest and remove organic material in the leachate While there were severaldifferent providers of carbon sources the specifications for Micro-C proprietaryproduct manufactured by Environmental Operating Solutions EOS wereused by CH2MHiII for modeling and initial volumetriccalculations for startup ofthe LIP Both CH2MHiII and General Electric the provider ofthe MBR recommended use of Micro-C for startup and commissioning ofthe LIP Current modeling indicatedthe plant would require approximately 2170 gallons of Micro-C per month Thenumber couldfluctuate up or down over time depending on the concentrationofthe leachate EOS offeredto provide Micro-C for $5.25 per gallon meaningone-year contract was potentially worth approximately $136000 Becausetheexact quantity that would be required wasunknown staff proposedawarding contractto EQS to provide Micro-C for $5.25 per gallon Payment would be made based on actual quantities provided Since there was requirement for chemicals duringstartup and commissioning of the LTP the Alaska Department of Environmental Conservation authorized use of project loansto pay portion ofthe costs It was anticipated that startup and commissioning would require approximately six months of Micro-C The balance would be paid for as an operational cost from the Landfill budget The other chemicals required for thetreatment process citric acid sodium hydroxide and sodium hypochlorite were issued as bid package and contract was submitted for Assembly approval ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY RohrerSkinner Symmons Griffin LeDoux and Lynch Contract No FY2016-16 LeachateTreatment Plant Chemicals Procurement GRIFFIN moved to authorizethe Manager to execute Contract No FY2016-16 with Univar USA Inc of Anchorage Alaska for LeachateTreatment Plant Chemicals in an amount of $9.55 per gallon for citric acid $5.25 pergallon for sodium hydroxide and $5.80 per gallon for sodium hypochiorite for the total amount not to exceed $147000 per year for the term ofthecontract Kodiak Island Borough Assembly RegularMeeting Minutes August 20 2015 Page 1547 The new LeachateTreatment Plant LTP required severaldifferent chemicals to treatleachate and cleanthe Membrane Bioreactor MBR system including citric acid sodium hydroxide and sodium hypochlorite The sodium hypochlorite was used to break down nitrates andaided in the degradation ofthe leachate components The citric acid andsodium hydroxide were used to cleanthe MBR equipment carbonsource was also required for operation of the MBR and separate contract for thatmaterial was submitted for Assembly approval Current modeling indicatedthat onan annual basisthe plant would require approximately 350 gallons of citric acid 27000 gallons of sodium hydroxide and450 gallons of sodium hypochlorite Theseamounts couldfluctuate up or down over time depending on the concentrationofthe leachate Staff issued bid package on July 2015 for procurement ofthe chemicals and the bid period closed on July 31 2015 Despite placing newspaper ads in Kodiak Anchorage and Seattle only one bid was received from Univar USA Inc of Anchorage Multiplying Univars unit bid prices by the projected amount of eachchemical required meant one-year contract was potentially worth approximately $147000 Becausethe exact quantity of eachchemical that would be required wasunknown staff proposedawarding thecontract to Univarbased on the unit prices provided in its bid Payment would be made on actual quantities provided Since there was requirement for chemicals duringstartup and commissioning ofthe LTP the Alaska Department of Environmental Conservation authorized use of project loans to pay portion ofthe costs It was anticipated that startup and commissioning would require approximately six months of chemicals The balancewouldbe paid for as an operational cost from the Landfill budget ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY Skinner Symmons Griffin LeDouxLynch and Rohrer Resolutions Resolution No FY2016-04 Approving Fiscal Year 2016 Kodiak Island Borough Non Profit Funding GRIFFIN moved to adopt Resolution No FY2016-04 The Borough was fortunateto enjoy the efforts of many benevolent non-profitorganizations that provided servicesthat enriched the lives of Kodiak residents The Kodiak charitable non-profit organizations provided humanitarian servicesthat many ofthe community members relied upon These organizations providedexpanded education cultural and healthservices that couldnt be providedthrough the ordinary governmental budget These organizations expanded theservices thatcould be provided withlimited funds through the utilization of volunteers The viability of these services was fundamental tothe quality of life enjoyed in the community Kodiak Island Borough Assembly RegularMeeting Minutes August 20 2015 Page 1548 Based on the discussion at the July 30th work session the Assembly recommended funding as reflected in the resolution Total amount requested for FY2016 $510699.54 Total amount appropriated for FY2016$390000 Total amount paid w/o organizations paid via tourism development fund $390000 Total amount paid from the tourism development fund $54017.00 Total amount $444017 The followingorganizations were funded through the Tourism Development Fund Alutiiq Museum and Archaeological Repository Kodiak Arts Council Kodiak Maritime Museum and Kodiak Historical Society LYNCH moved to amend Resolution No FY2016-04 by deleting the Contingency amount of $9850 and adding $2180 totheBrother FrancisShelter for total of $56180 and adding $6670 tothe Kodiak Island Food Bank for total of $45120 ROLLCALL VOTE ON MOTIONTO AMEND CARRIEDUNANIMOUSLY Symmons Griffin LeDoux Lynch Rohrer and Skinner ROLLCALL VOTE ON MAIN MOTIONAS AMENDED CARRIED UNANIMOUSLY Griffin LeDouxLynch RohrerSkinner and Symmons Clerks Note $1000 was leftin the contingency account Resolution No FY2016-05 Authorizing the Borough toIssue General Obligation School Bonds in the Principal Amount not to Exceed $11000000 to Provide Funds for School and Related Capital Improvements in the Borough and to Pay Costs of Issuing the Bonds Fixing CertainDetailsof Such Bonds Authorizing Their Sale and Providing for Related Matters LYNCHmoved to adopt Resolution No FY2016-05 Clerks Note substituted versionofResolution No FY2016-05 amending the principal amount to $8000000 and changing theinterest payment date to April 2016 was provided Atthe October 2009 regular Borough election thevoters approved selling $76310000 in generalobligation bonds The resolution approved the saleof thosebonds and setcertain detailsofthe bonds The Borough had not issuedtheentireauthorized amount ofthe bonds and this was thefourth bond salerelated tothe project The bond issue was reimbursable by theStateof Alaska at 70% LYNCH moved to amend Resolution No FY2016-05 by substitution ROLL CALL VOTE ON MOTION TO AMEND CARRIED UNANIMOUSLY LeDoux Lynch RohrerSkinner Symmons and Griffin Kodiak Island Borough Assembly RegularMeeting Minutes August 20 2015 Page 1549 ROLL CALL VOTE ON MAIN MOTIONAS AMENDED CARRIED UNANIMOUSLY Lynch RohrerSkinner Symmons Griffin and LeDoux Resolution No FY2016-06 Authorizing the Borough to Issue General Obligation School Bonds in the Principal Amount not to Exceed $10230000 to Provide Funds to Finance the Renewal and Replacement SchedUleRelated to Borough-Owned School Facilities Projects Which are 70%Reimbursable by theStateof Alaskaand to Pay Costs of Issuing the Bonds Fixing CertainDetailsof Such Bonds Authorizing Their Sale and Providing for Related Matters LEDOUX moved to adopt Resolution No FY2016-06 Per the October 2014 electionthe Borough can issue $10230000 in generalobligation bonds for the renewaland replacement of borough owned school facilities The bonds are 70% reimbursable by theStateof Alaska The Borough wished to sell the bonds through the Alaska Bond Bank The resolutionauthorizedthesale of thebondsand setcertaindetails ofthe bonds The resolution was similar totheresolutionsthe Borough used to sell all of its previous bonds ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY Rohrer Skinner Symmons Griffin LeDoux and Lynch Resolution No FY2016-07 Authorizing the Borough to IssueGeneral Obligation School Refunding Bond in the Principal Amount not to Exceed $5970000 to Refund Certain Principal Installmentsof an Outstanding General Obligation School Bond ofthe Borough and to Pay Costs of Issuing the Bond Fixing Certain Detailsof Such Bond Authorizing Its Sale and Providing ForRelated Matters LYNCH moved to adopt Resolution No FY2016-07 Working withthe Bond bank the Borough would be abletorefinance the 2008 bond issue for an anticipated net savings of $241228 since thestate would receive 70%of the refund The Borough would save 30%or $72368 Thisresolution authorized thesaleofthe bonds and setthedetails of the issue ROLL CALL VOTE ON MOTIONCARRIED UNIANIMOUSLY Skinner Symmons Griffin LeDoux Lynch and Rohrer Resolution No FY2016-08 Amending the FeeSchedule to Waive Certain PermitFees Associated with Moving Mobile Homes From JacksonMobile Home Park GRIFFINmoved to adopt Resolution No FY2016-08 Kodiak Island Borough Assembly Regular Meeting Minutes August 20 2015 Page 1550 The resolution wouldwaive particular fees ZoningCompliance Building Electrical and Plumbing permits relating to therelocationof mobile homes fromJacksonMobile Home Park to another park or parcel allowed under zoning codes The City of Kodiak indicatedthat it would take similar actionatthe City Council meeting in September ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY Symmons Griffin LeDoux Lynch Rohrer and Skinner Ordinances for Introduction None OtherItems Confirmation of MayoralAppointments of AssemblyRepresentatives to theKodiak Workforce RegionalAdvisory Council Kodiak Fisheries Work Group and Assembly Representative tothe City ofPort Lions LEDOUX moved to confirmthe following Mayoralappointments of Assembly member Symmons to the KodiakWorkforce RegionalAdvisory Council and as the Assembly Representative to the City of PortLions and Assembly member Skinner tothe Kodiak Fisheries Work Group With the recent appointment of Assembly member Symmons tothe Assembly Mayor Friend asked to fill the vacated seats as follows KodiakWorkforce RegionalAdvisory Council Assembly member Symmons Assembly Representative to the City ofPortLions Assembly member Symmons Kodiak Fisheries Work Group Assembly member Skinner The complete list of Assembly member representatives to BoardsCommittees and Commissions and Councils and Assembly representatives tothe rural communities was provided ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY Griffin LeDoux Lynch Rohrer Skinnerand Symmons Hiring of Resource Management Officer LYNCH moved to approve the hiring oftheselected applicant as the Resource Management Officer at Range 21.5 Step of the salary schedule The position ofthe Resource Management Officer was vacated in late January of this year The vacancy was advertised and applications were accepted according to Borough policy One applicant rose to the top he was interviewed and tentatively selected The negotiation process resulted in starting salary above the Managers authority for approval The selected applicant was former Boroughemployee with extensive experience relatedto land use and public process Due to the applicants background and experience the Manager believedthat startingsalary at Range 21.5 Step was appropriate Kodiak Island Borough Assembly Regular Meeting Minutes August 20 2015 Page 1551 ROLL CALL VOTE ON MOTIONCARRIEDFOURTO TWO LeDoux Lynch Rohrer and Griffin Ayes Skinner and Symmons Noes GRIFFINmoved to move Citizens Comments before the Executive Session VOICE VOTE ON MOTION CARRIEDUNANIMOUSLY CITIZENS COMMENTS Judi Kidderthankedthe Assembly for adopting Resolution No FY2016-08 and for the efforts of transparency and information sharing for the sake ofthe community members Ten Storchthankedthe Assembly for adopting the amendments toResolution No FY20 16-04 KarenBarker spoke onconcerns regarding the lack of hiring Fire Chief at the Bayside Fire Department EXECUTIVESESSION Borough Clerks Performance Evaluation LYNCH moved to convene into executive session to discuss the Borough Clerks performance evaluation subject that qualifies for executivesessionas matter that may tend to prejudice her reputation or character ROLL CALL VOTE ON MOTIONCARRIEDUNANIMOUSLY Lynch RohrerSkinner Symmons Griffin and LeDoux LYNCH moved to invite the Deputy Presiding Officer Assembly and Clerk into executive session ROLLCALLVOTE ON MOTIONCARRIED UNANIMOUSLY RohrerSkinner Symmons Griffin LeDoux and Lynch After the vote Deputy Presiding Officer Rohrer recessed the regular meeting at 945 p.m and convened the executive session Upon returning from the executive session Deputy Presiding Officer Rohrerreconvened the regular meeting at 1025 p.m and announced no action was to be taken as resultofthe executive session ASSEMBLY MEMBERS COMMENTS Assembly member Symmons thanked the Planning and Zoning Commission for its hard work Assembly member LeDoux thankedFinance Director Short for hisattentiontothe bonds and his willingness to answer the Assemblys questions He thankedthecandidates for filing for the Kodiak Island Borough Assembly RegularMeeting Minutes August 20 2015 Page 1552 upcoming election and spoke to concerns on the lack of hiring Fire Chief at Bayside Fire Station Assembly member Lynch announced upcoming Kodiak Fisheries Work Group meetings and the scheduled community forum Assembly members RohrerandSkinner congratulated the Employee ofthe Quarter and Longevity Award recipients Assembly member Skinner expressed appreciation for the election candidates willingness to serve She thanked the public for its participation at public meetings and for those who volunteeredto serve on boards and committees Assembly member Griffin spoke tothestate-wide issueofnot being ableto fill key positions for state and local government jobs due tothe PERS system definedbenefit program Assembly member Rohrer expressed concern on the Bayside Fire Chief vacant position and asked Manager Cassidy to provide status update at thenext work session Announcements The Assembly would hold special meeting on Thursday August 27 at 730 p.m in the Borough Conference Room andwould holdthe regularly scheduledworksession immediately following The next regular meeting was scheduled on Thursday September at 730 p.m in the Borough Assembly Chambers ADJOURNMENT LYNCH moved to adjourn the meeting ROLL CALL VOTE ON MOTIONCARRIED UNANIMOUSLY Skinner Symmons Griffin LeDouxLynch and Rohrer The meeting was adjourned at 1035 p.m KODIAKISLANDBORC.U3H A1EST Iour .. Nova Javier Borough Clerk Approved on September 2015 Kodiak Island Borough Assembly RegularMeeting Minutes August 20 2015 Page 1553 Introduced by BoroughManager Requested by Finance Director Drafted by Bond Counsel Introduced on 08/20/2015 Adopted on 08/20/2015 KODIAK ISLAND BOROUGH RESOLUTION NO FY2OI 6-06 RESOLUTIONOFTHE KODIAK ISLAND BOROUGH ASSEMBLY AUTHORIZING THE BOROUGH TO ISSUE GENERAL OBLIGATION SCHOOL BONDS IN THE PRiNCiPAL AMOUNT NOT TOEXCEED $10230000 TOFINANCETHE RENEWAL ANDREPLACEMENT SCHEDULERELATEDTO BOROUGH-OWNED SCHOOL FACILITIES 10 PROJECTSWHICHARE70%REIMBURSABLE BYTHESTATEOF 11 ALASKA AND TOPAYCOSTSOF ISSUING THE BONDS FIXING 12 CERTAIN DETAILS OFSUCH BONDS AUTHORIZING THEIR SALE 13 AND PROVIDING FOR RELATED MATTERS 14 15 WHEREAS pursuant to Ordinance No FY2015-02 of theKodiak Island Borough Alaska the 16 Borough adoptedAugust 2014 question whether the Borough should Issue notto exceed 17 $10230000 in general obligation bonds for the purpose of paying thecostofthe renewal and 18 replacement schedule relatedto Borough-owned school facilities projects which are 70% 19 reimbursable by theStateof Alaska referredtothe regular Borough electionheld on October 20 2014 as Proposition No Proposition was passed and approved and 21 22 WHEREAS the Assembly findsthat it is in the best interest ofthe Borough to carry outthe 23 Projects defined below and to issuenot to exceed $t0230000 principal amount of general 24 obligation bonds referred to in Proposition to pay part ofthe costs ofthe Projects and costs of 25 issuing the bonds and 26 27 WHEREAS the Borough will notissue the bonds until the Boroughs school district receives 28 notice from theStateof Alaska Department of Education Early Development Divisionof School 29 Finance that the bonds are approved for 70%reimbursement and 30 31 WHEREAS the bonds will not be sold ii thetrueinterest cost is over four percent 4%and 32 33 WHEREAS Section29.47.410 0$the Alaska Statutes provides that the Assembly by resolution 34 may provide for the form and manner of safeof bondsand notes and 35 36 WHEREAS the Assembly finds that it is necessary and appropriate to delegate to each ofthe 37 Borough Manager and Borough Finance Director authority to determine the maturity amounts 38 interest rates and otherdetails of the b9nds and to determine other matters that are not provided 39 for in this resolution including without limitation whether to sell the Bonds tothe Alaska Municipal 40BondBank the Bond Bank or another Financial Institution or toofferthe Bonds at public sale 41 42 NOW THEREFORE BE IT RESOLVED BYTHE ASSEMBLY OF THE KODIAK ISLAND 43 BOROUGH THAT 44 45 Section Definitions In additionto terms whicharedefined in the recitals above the 46 following terms shall have the following meanings inthis Resolution 47 48 Assembly means the Assembly of the Kodiak Island Borough as the 49 general legislativeauthority ofthe Kodiak Island Borough as the same shall be 50 duly and regularly constituted fromtime to time 51 KodiakIsland Borough Alaska -- Resolution No FY2OIB.06 Page of 11 52 Bond or Bonds means any ofthe General Obligation School Bonds 53 ofthe Kodiak Island Borough the Issuanceand saleor which are authorized 54 herein 55 56 Bond Bank means the Alaska Municipal Bond Bank public 57 corporation of the Stateof Alaska 58 59 Bond Bank Bonds means the series of general obligation bonds issued 60 by the Bond Bank all or part ofthe proceeds of which are used to purchase the 61 Bonds 62 63 Bond Register means the registration booksmaintained by the 64 RegIstrar which includethe names and addresses of the Registered Owners of 65 the Bonds or their nominees 66 67 Borough means the Kodiak Island Borough municipal corporation of 68 theState of Alaska organized as second class borough under Title 29 ofthe 69 Alaska Statutes 70 71 BoroughManager means the Manager orAdministrative Official ofthe 72 Borough 73 74 Code means theInternal Revenue Code of 1986 as amended from 75 time to time together with all regulations applicable thereto 76 77 or Costs means the cost of planningdesigning acquiring 78 property for1 acquiring constructing installing and equipping the Projects 79 includIng interest on the Bonds during the period of planning designing 80 acquIring property for acquiringconstructing installing and equipping the 81 Projects the cost whether Incurred by the Borough or by another of field surveys 82 andadvance planning undertaken In connection withthe Projectsproperly 83 allocabletothe Projects the cost of acquisition of any land or interesttherein 84 required as the site or sitesofthe Projects or for use in connection therewith the 85 cost of any indemnity and surety bondsand premiums on insurance incurred in 86 connection withthe Projects prior to or during construction thereof all related 87 direct administrative and inspection expenses whether incurred by the Borough 88 or by another in connection withthe Projects prior to or during construction 89 thereof and allocable portions ofdirectcostsofthe Borough legal fees costsof 90 issuance ofthe Bonds by the Borough includingfinancing charges andfees and 91 expenses of bond counsel financial advisorsandconsultants in connection 92 therewith the cost of any bondinsurance premium and bond ratings the costof 93 audits the cost of all machineryapparatus and equipment cost of engineering 94 architectural servicesdesignsplans specifications and surveys estimates of 95 cost the reimbursement of all moneys advanced from whateversource for the 96 payment of any itemorItems of cost ofthe Projects and all other expenses 97 necessary or Incidentaltothe acquisition and development of the Projects the 96 financing thereof and the putting ofthe same In useand operation 99 100 Financial Institution means any bank or otherfinancial institution 101 insured by the Federal Deposit Insurance Corporation or the Federal Savings 102 andLoanInsurance Corporation 103 104 Government Obligations means obligations that are eitherdirect 105 obligations oftheUnited States of America or ii obligations of an agency or 106 instrumentality ofthe UnitedStates of America the timely payment ofthe Kodiak Island Borough Alaska Resolution No FV2016-06 Page of 11 107 principal of and interest on which are unconditionally guaranteedby theUnited States of America Loan Agreement means the Loan Agreement between the Borough and the BondBank orotherFinancial Institution concerning the Bonds Projects means collectively the cost of school facilities renewaland replacement projects that address worn out building components suchas roofs floors undergroundstorage tanks etc that havereached the end of their useful life including without limitation the followingprojects and other related projects KodiakMiddleSchool undergroundstorage tank replacement new elevator controls new HVAC heating controls rear parking lot paving fire alarm replacement andbus ramp roof replacement East Elementary School flooring replacement cafeteriaroof replacement partial interior renovation and replacement of plumbing fixtures Peterson Elementary School flooring replacement new HVAC heating controls parking lot paving and replacement of boilers Port Lions School undergroundstorage tank replacement and playgroundequipment replacement Main Elementary School underground storage tank replacement and gym floor replacement Ouzinkie School old wing flooring replacement new wing flooring replacement and playgroundequipment replacement AkhiokSchool flooring replacement and playgroundequipment replacement Karluk School flooring replacement and playgroundequipment replacement ChiniakSchool playground equipmentreplacement andOld HarborSchool playgroundequipmentreplacement and underground storage tank replacement Registered Owner means the person named as the registered owner of Bond in the Bond Register Recitrpr means the Borough Finance Director or any successor that the Borough may appointby resolution Resolution mans this Resolution No FV2016-_of the Borough Authorizationof Bonds andPurpose of Issuance Forthe purpose of providing funds for financing the Costs ofthe Projects the Borough shall Issue and sell general obligation bonds designated Kodiak Island Borough Alaska General Obligation School Bonds the Bonds in the aggregate principal amount ofnot to exceed $10230000 The proceeds ofthe Bonds shall be used to pay Costs ofthe Projects The Projects serve public purpose ofthe Borough The Manager and/or the Finance Director are hereby authorized to determine whether the Bonds shall be soldtothe Bond Bank or Financial Institution or soldat public sale andwhether toissuethe Bonds in one or more issues but in no event shall the aggregate principal amount ofthe Bonds exceed $10230000 The Borough will notissue the bonds until the Boroughs school district receives notice from theStateof Alaska Department of Education Early Development Division of School Finance thatthe bonds are approved for 70%reimbursement ResoluLion No FY2016-06 Page of 11 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 151 152 153 154 155 156 Section KodiakIsland Borough Alaska 157 Section Obligationof Bonds TheBonds shall be direct and general obligations of the 158 Borough and the full faith and credit of the Borough are herebypledged to the 159 payment ofthe principal of and interest on the Bonds The Boroughhereby 160 irrevocably pledges and covenants that it will levy and collecttaxes upon all 161 taxable property withinthe Borough without limitation as torate or amount in 162 amounts sufficient together withother funds legally available therefor to pay the 163 principal of and interest on the Bonds as the same becomedueand payable 164 165 SectionDesignation Maturities Interest Rptep.and Other Detailsof Bonds TheBonds 166 shall be designated Kodiak Island Borough Alaska General Obligation School 167 Bonds TheBonds shall be in the denomination of $5000 or any Integral 168 multiple thereof shall benumbered separately In the manner and with such 169 additional designation as the Registrar deems necessary for purposes of 170 identification and may haveendorsedthereonsuch legends or text as may be 171 necessary or appropriate to conform tothe rules and regulations of any 172 governmental authority or anyusage or requirement of law with respect thereto 173 174 TheBonds shall mature in one or more years commencing no earlier than 2015 175 and ending no later than 20LJ TheBonds shall bear interest from their date 176 payable commencing on date on or after 2QJ and semi-annually 177 thereafter Interest will be computed on thebasis of 360-day year consisting of 178 twelve 30-day months 179 180 Subject to Sectionand the remainder of this Section thedated date the 181 principal and Interest payment dates therecord dates for interest payments the 182 aggregate principal amount the principal amount of each maturity and the 183 interest rates on the Bonds shall bedetermined atthe time of execution of the 184 Loan Agreement atorbefore public saleofthe Bonds underSection 17 185 186 Section Optional Redemption The Bonds if any subject to optional redemptionby the 187 Borough the time or times when such Bonds are subject to optional redemption 188 the terms upon whichsuch Bonds may be redeemed andthe redemption price 189 or redemption prices for such Bonds shall bedetermined at the time ofsaleof 190 the Bonds by the Borough Manager or Finance Director 191 192 Section Selectionof Bonds or Redemption Notice of Redemption 193 194 Selectionof Bonds for Redemption When and if the Bond Bank or 195 Financial Institution is the Registered Owner ofthe Bonds theselection of Bonds 196 to be redeemed shall be made as provided in the Loan Agreement When and if 197 the BondBank or Financial Institution is notthe Registered Owner of the 198 Bonds the selectionof Bonds to be redeemed shall be made asprovided in this 199 subsection If the Borough redeems at any one time fewerthan all of the 200 Bonds having the same maturity date the particular Bonds or portions of Bonds 201 of such maturity to be redeemed shall beselected by lot or in such other manner 202 determined by the Registrar in increments of $5000 In the case of Bond of 203 denomination greater than $5000 the Borough shall treat such Bond as 204 representing such number of separate Bonds each ofthe denomination of $5000 205 as is obtained by dividing the actual principal amount of such Bond by $5000 In 206 the event that onlyportion ofthe principal amount of Bond Is redeemed upon 207 surrender of such Bond attheoffice ofthe Registrar thereshall be issued to the 208 Registered Owner without charge therefor for the then unredeemed balance of 209 the principal amount thereof at the option ofthe Registered Owner Bond or 210 Bonds of like maturity and Interestrate in any of the denominations authorized 211 herein 212 KodiakIsland Borough Alaska Resolution No FY2016-06 Page4ofll 213 Noticeof Redemption When and if the BondBank or Financial 214 Institution is the Registered Owner ofthe Bonds notice of any intended 215 redemption of Bonds shall be given as provided In the Loan Agreement When 216 and if the BondBank or Financial Institution is notthe Registered Owner of the 217 Bonds notice of any intended redemption of Bonds shall be given as provided in 218 this subsection Notice of redemption shall be mailednot less than20 or 219 more than45 days prior tothe date fixed for redemption by first classmail to 220 Registered Owners ofthe Bonds to be redeemed at their addressesas they 221 appear on the Bond Register on the day thenotice is prepared Notice of 222 redemption shall be deemed to havebeen given when thenotice is mailedas 223 herein provided whether or not it is actually received by the Registered Owners 224 All noticesof redemption shall be datedand shall state the redemption date 225 the redemption price ii fewerthan all outstanding Bonds are to be 226 redeemed the identification and in the case of partial redemption the 227 respectiveprincipal amounts ofthe Bonds to be redeemed that on the 228 redemption date the redemption price will becomedue and payable upon each 229 such Bond or portion thereofcalled for redemption and thatinterest thereon shall 230 cease to accrue from and after said date and the place where suchBonds 231 are to be surrendered for payment ofthe redemption price which place of 232 payment shall be the officeofthe Registrar 233 234 Official noticeof redemptionhaving been given as stated above Bonds or 235 portions of Bonds to be redeemed shall on the redemption date become due 236 and payable atthe redemption price therein specified and from and after such 237 date such Bonds or portions of Bonds shall cease to bear interest Upon 238 surrender of such Bonds for redemption in accordance withsaid notice such 239 Bonds shall be paid atthe redemption price Installments ofinterest due on or 240 prior tothe redemption date shall be payable as herein provided for payment of 241 Interest All Bonds whichhave been redeemed shall be canceledand destroyed 242 by the Registrar and shallnot be reissued 243 244 Each check or other transfer of fundsissued to pay the redemption price of 245 Bonds shall bear the CUSIP number if any identifying by maturity the Bonds 246 being redeemed withthe proceeds of such check or other transfer 247 248 Section Form of Bond Each Bond shall be in substantially the following form with such 249 variations1 omissions and insertions as may be required or permitted by this 250 Resolution 251 252 UNITED STATESOF AMERICA 253 254 KODIAK ISLAND BOROUGH ALASKA 255 256 NO _______$________ 257 258 GENERAL OBLIGATION SCHOOL BOND 259 260 REGISTERED OWNER 261 262 PRINCIPAL AMOUNT 263 264 The Kodiak Island Borough the Borough municipal corporation of 265 theState of Alaska hereby acknowledges itself to owe and for value received 266 promises to pay to the Registered Owner identified above or its registered 267 assigns the principal amount identified above in the following installments on 268 each ofthe following years and to pay interest on such installments from the Kodiak Island Borough Alaska Resolution No FY2016-06 Page of 11 269 date hereof payable on 201_and semiannually thereafter on 270 and ____of each year attherates per annum as follows 271 272 MaturityPrincipal Interest 273 Amount 274 275 276 277 When and if this Bond Is owned by the Alaska Municipal BondBank or 278 Financial Institution payment of principal and interest shall be made as provided 279 in the Loan Agreementbetween the BondBank or Financial Institution and the 280 Borough the Loan Agreement When and if this Bond is not owned by the 281 BondBank or Financial Institution installments of principal of and interest on 282 this Bond shall be paid by check ordraft mailed by first classmail to the 283 Registered Owner as oftheclose of business on the 15th day of the month 284 beforeeach installment payment date provided thatthe final installmentof 285 principal of and interest on this Bond shall be payable upon presentation and 286 surrender of this Bond by the Registered Owner atthe officeof the Registrar 287 Interest will be computed on the basisof 360-day year consisting oftwelve30- 288 day months Both principal of and interest on this Bond are payable in lawful 289 money of the UnitedStates of America which on the respective datesof 290 payment thereof shall be legal tender for the payment of public and private 291 debts 292 293 This Bond is one of the General Obligation School Bonds ofthe Kodiak 294 Island Borough Alaska of like tenor and effect except as tointerest rate serial 295 number right of redemption or prepayment and maturity and constituting Bonds 296 authorized for the purpose of paying the cost of schooland related capital 297 improvements in the Borough and is issuedunderResolution No FY2016-_of 298 the Borough entitled 299 300 RESOLUTION OFTHE KODIAK ISLAND BOROUGH ASSEMBLY 301 AUTHORIZINGTHE BOROUGH TO ISSUE GENERAL OBLIGATION 302 SCHOOL BONDS IN THE PRINCIPAL AMOUNT NOT TOEXCEED 303 $10230000 TO FINANCETHE RENEWALAND REPLACEMENT 304 SCHEDULE RELATEDTO BOROUGH-OWNED SCHOOL FACILITIES 305 PROJECTSWHICHARE 70%REIMBURSABLE BY THESTATEOF 306 ALASKA AND TOPAYCOSTSOF ISSUING THE BONDS FIXING 307 CERTAIN DETAILS OFSUCH BONDS AUTHORIZING THEIR SALE 308 AND PROVIDINGFOR RELATED MATtERS 309 310 the Resolution 311 312 TheBonds of principal of this Bond maturing on and after 313 ______20_shall be subject to prepayment on and after _____20_at the 314 option ofthe Borough fsubject to any applicableprovisions ofthe Loan 315 AgreementJ in such principal amounts and from such maturities as the Borough 316 may determine and by lot within maturity at redemption price equal to the 317 principal amount to be prepaid plus accrued interest tothe date of prepayment 318 319 This Bond Is transferable as provided in the Resolution only upon the 320 Bond Register of the Borough and ii upon surrender of this Bond together with 321 written Instrument of transfer duly executed by the Registered Owner or the 322 duly authorized attorney of the Registered Owner and thereupon new fully 323 registered Bond or Bonds in the same aggregate principal amount and maturity 324 shall be issued tothetransferee in exchange therefor as provided in the KodiakIsland Borough Alaska Resolution No FY2016-06 Page6oIll 325 326 327 328 329 330 331 332 333 334 335 336 337 338 339 340 341 342 343 344 345 346 347 348 349 350 351 352 353 354 355 356 357 358 359 360 361 362 363 364 365 366 367 368 369 370 371 372 373 374 375 376 377 378 379 Resolutionand upon the payment of charges if any as therein prescribed The Borough may treat and consider the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of or on account of the principal or redemption price ii any hereof and interest due hereonand for all other purposes whatsoever This Bond is general obligation ofthe Kodiak Island Borough and the full faith and creditofthe Borough are pledged for the payment ofthe principal of and interest on this Bond as the same shall become due ITIS HEREBY CERTIFIED AND RECITED that all conditions actsor things required by theconstitutionorstatutesofthe State of Alaska to exist to have happened or to havebeen performedprecedent to or in the issuance of this Bond exist have happened andhave been performed and thattheseriesof Bonds of which this is one together with all other indebtedness ofthe Borough is within every debtand other limit prescribedby such constitution or statutes IN WITNESS WHEREOF THE KODIAK ISLAND BOROUGH ALASKA hascaused this Bond to be signed in its name andon its behalf by the manual or facsimile signature of its Mayor and its corporate seal or facsimile thereof to be impressed or otherwise reproduced hereonand attested by the manual or facsimile signature ol its Clerk all as ofthe day of 2015 ATTEST /speciment Borough Clerk KODIAK ISLAND BOROUGH Ienae4rnanl Borough Mayor SectionExecutipn TheBonds shall beexecuted in the name of the Borough by the manual or facsimile signature ofthe Mayor and its corporate seal or facsimile thereof shall be Impressed or otherwise reproduced thereonand attested by the manual or facsimile signature ofthe Borough Clerk The execution of Bond on behalf of the Boroughbypersons who atthe time of the execution are duly authorized tohold the proper officesshall be valid and sufficient for all purposes althoughany such person shall haveceased to holdofficeatthetime of delivery ofthe Bond or shallnot have held office on the date ofthe Bond Section Payment ofPrincipal and Interest The Bonds shall be payable in lawful money ofthe UnitedStates of Americawhich atthetimeof payment is legal tender for the payment of public and private debts When and if the BondBank or Financial Institution is the Registered Owner ofthe Bonds payment of principal of and Interest on the Bonds shall be made as provided in the Loan Agreement When and ii the BondBank or Financial Institution is notthe Registered Owner of the Bonds installments of principal of and interest on the Bonds shall be paid by checkmailed by first class mail tothe Registered Owner as of the record date for the installment payment at the address appearing on the Bond Register provided thatthe final installment of principal and interest on Bond shall be payable upon presentation and surrender ofthe Bond by the Registered Owner attheofficeof the Registrar Resolution No FY20 16-06 Page or ii KodiakIsland Borough Alaska 380 Section 10 Registration TheBonds shall beissued onlyregistered form as to both 381 principal and interest The Boroughdesignates the Borough Finance Director as 382 Registrar for the Bonds The Registrar shall keep or cause to be kept the Bond 383 Register atthe principal officeofthe Borough The Borough covenants that until 384 all Bonds havebeensurrendered and canceled it will maintain system for 385 recording the ownership of each Bond that complies withthe provisions of 386 Section149 ofthe Code The Borough and the Registrar may treatthe person in 387 whosename any Bond shall be registered as the absolute owner of such Bond 388 for all purposes whether or notthe Bond shall be overdue and all payments of 389 principal of and Interest on Bond made tothe Registered Owner thereof or 390 upon its order shall be valid and effectualto satisfy and discharge the liability 391 upon such Bond to the extentofthe sum or sums so paid and neitherthe 392 Borough nor the Registrar shall be affected byany noticeto the contrary 393 394SectIon 11 Transfer and ExchangeBonds shall be transferred only upon the Bond 395 Register Upon surrender fortransferor exchange of any Bond at the office of 396 the Registrar together withwritten instrument of transfer or authorization for 397 exchange in form and with guaranty of signature satisfactory tothe Registrar 398 duly executed by the Registered Owner or the duly authorized attorney ofthe 399 Registered Owner the Borough shall executeand deliver an equalaggregate 400 principal amount of Bonds of the same maturity of any authorized denominations 401 subject to suchreasonable regulations as the Borough may prescribe and upon 402 payment sufficientto reimburse it for any tax fee or other governmentalcharge 403 required to be paid in connection with such transferor exchange All Bonds 404 surrendered for transfer or exchange shall becanceled by the Registrar 405 406 Section 12 Bonds Mutilated Destroyed StolenorLost Upon surrender to the Registrar of 407 mutilated Bond the Borough shall executeand deliver newBond of like 408 maturity and principal amount Upon filing withthe Registrar of evidence 409 satisfactory tothe Borough that Bond has been destroyed stolen or lost and of 410 the ownership thereof and upon furnishing the Borough with indemnity 411 satisfactory to it the Borough shall execute and deliver new Bond of like 412 maturity and principal amount The person requesting the executionand delivery 413 of new Bond under this section shall comply with such other reasonable 414 regulations as the Borough may prescribe and shall pay such expenses as the 415 Borough may incur in connection therewith 416 417 Section 13 Disposition ofthe SaleProceeds ofthe Bonds The sale proceeds ofthe Bonds 418 representing accrued interest on the Bonds shall be applied to pay portion of 419 the interest due on the Bonds on the first interest payment date for the Bonds 420 The sale proceeds ofthe Bonds representing original issue premium on the 421 Bonds shall be applied to pay portion ofthe interest due on the Bonds on the 422 first interest payment date for the Bonds or Costs ofthe Projects and shall be 423 deposited in such manner as the Borough Manager or the Borough Finance 424 Director may determine The remaining sale proceeds ofthe Bonds shall be 425 applied to pay Costs ofthe Projects and shall be deposited in the appropriate 426 funds or accounts ofthe Borough for such purposes 427 Kodiak Island Borough Alaska Resolution No FY20 16-06 Page of 428 Section 14 Tax Covenants The Borough covenants to comply with any and all applicable 429 requirements setforth in the Code in effect fromtime totimetotheextentthat 430 such compliance shall be necessary for the exclusion of theinterest on the 431 Bonds from gross income for federal income tax purposes The Borough 432 covenants that it will make nouse ofthe proceeds of the Bonds which will cause 433 the Bonds to be arbitrage bonds subject tofederal income taxation by reason of 434 Section148 ofthe Code The Borough covenants that it will nottake or permit 435 any actionthat wouldcause the Bonds to be private activity bonds as defined in 436 Section 141 ofthe Code 437 438 Section 15 Amendatorv and Suplemental Resolutions 439 440 The Assembly from timeto time and at any time may adopt resolution 441 or resolutions supplemental hereto which resolution or resolutionsthereafter 442 shall become part of this Resolution for any one or more of the following 443 purposes 444 445 To add to the covenantsand agreements ofthe Borough inthis 446 Resolution1 other covenants and agreements thereafter to be observed 447 or to surrender any right or power herein reserved to or conferred upon 448 the Borough 449 450 Tomake such provisions for the purpose of curing any 451 ambiguities orof curing correcting or supplementingany detective 452 provision contained in this Resolution or in regard to matters or questions 453 arising under this Resolutionas the Assembly may deem necessary or 454 desirable and not inconsistentwith this Resolution and which shallnot 455 adversely affect the interestsofthe Registered Owners ofthe Bonds 456 457 Any such supplemental resolution may be adopted without the consent of the 458 Registered Owners of any ofthe Bonds at any time outstanding notwithstanding 459 any of the provisions of subsection of this section 460 461 With the consent of the Registered Owners of not less than 60 percent in 462 aggregate principal amount ofthe Bonds at the time outstanding the Assembly 463 may adopt resolution orresolutions supplemental hereto for the purpose of 464 addingany provisions to or changing in any manner or eliminating any of the 465 provisions of this Resolution orof any supplemental resolution provided 466 however that nosuch supplemental resolution shall 467 468 Extend thefixed maturity of any ofthe Bonds or reduce therate 469 ofinterest thereon or extend thetimeof payments of interest from their 470 due date or reduce the amount of the principal thereof or reduce any 471 premium payable on the redemption thereof without the consent of the 472 Registered Owner of each Bond so affected or 473 474 Reduce theaforesaid percentage of Registered Owners of 475 Bonds required to approveany such supplemental resolutionwithoutthe 476 consent ofthe Registered Owners of all of the Bonds then outstanding 477 478 It shall not be necessary for the consent ofthe Registered Owners of the Bonds 479 under this subsection to approve the particular form of anyproposed 480 supplemental resolution but it shall be sufficient if suchconsent approves the 481 substance thereof 482 KodiakIsland Borough Alaska Resolution No FY2016-06 Page of 11 483 Upon the adoption of anysupplemental resoluUonunder this section this 484 Resolution shall be deemed to be modified andamended in accordance 485 therewith and the respective rights duties and obligations under this Resolution 486 of the Borough and all Registered Owners of outstanding Bonds shallthereafter 487 be subject in all respects to such modification and amendment and all the terms 488 and conditionsofthe supplemental resolution shall be deemed to be part ofthe 489 terms and conditionsof this Resolution for any and all purposes 490 491 Bonds executedand deliveredafterthe adoption of anysupplemental 492 resolution under this section ma bear notation as to any matter provided for in 493 such supplemental resolution and if such supplemental resolutionshall so 494 provide newBonds modified soas to conform In the opinion ofthe Borough to 495 any modificationof this Resolutioncontained in any such supplemental resolution 496 may be preparedby the Borough and delivered without costtothe Registered 497 Owners of the Bonds then outstanding upon surrender for cancellationof such 498 Bonds in equalaggregate principal amounts 499 500 Section 16 Defeasance In the event mony andlor non-callable Government Obligations 501 maturing at such times and bearing interest to be earnedthereon in amounts 502 sufficient to redeem and retire any or all ofthe Bonds in accordance with their 503 terms are set aside in special trust account toeffect such redemption or 504 retirement andsuch moneys and the principal of and interest on such 505 Government Obligations are Irrevocably set asideand pledged for such purpose 506 then no further payments needbe made to pay or secure the payment ofthe 507 principal of and interest onsuch Bonds andsuch Bonds shall be deemed not to 508 be outstanding 509 510 Section 17 Sale of Bonds TheBonds shall be soldat negotiated saleto the Bond Bank or 511 Financial Institution as provided in the form of Loan Agreement or at public sale 512 as the Borough Manager andFinance Director determine is in the best interestof 513 the Borough Subject to the limitations provided in Sectionsandeach ofthe 514 Borough Manager and the Borough Finance Director is hereby authorized to 515 determine the aggregate principal amount maturity amounts interest rates 516 yields dated date principal and interest payment dates redemption terms if 517 any for the Bonds and otherdetails of the Bonds provided thatthetrueinterest 518 cost ofthe Bonds expressed as anannual rate does not exceed 6.0 percent In 519 determining the maturity amounts interest rates yields and redemption terms II 520 any for the Bonds the Borough Manager or Borough Finance Director shalltake 521 into accountthose factors which in the judgment of each will result in thelowest 522 true interest coston the Bonds to their maturity Including without limitation 523 currentfinancial market conditions and currentinterest rates for obligations 524 comparable in tenor and quality tothe Bonds Based upon the foregoing 525 determinations the Borough Manager andthe Borough Finance Director each is 526 authorized to execute the Loan Agreement in substantially the form presented at 527 this meeting or to sell the Bonds at public sale as they deem appropriate and 528 cost effective to and in the best interest of the Borough 529 530 Section 18 Authority ofOfficers The Mayor the Borough Manager the Borough Finance 531 Director and the Borough Clerk each is authorizedand directedto doand 532 perform all things and determine all matters not determined by this Resolution to 533 the end thatthe Borough may carry out its obligations under the Bonds and this 534 Resolution 535 536 Section 19 Prohibited Sale of Bonds No person firm orcorporation or anyagent or 537 employee thereof acting as financial consultant tothe Borough under an 538 agreement for payment in connection withthesaleofthe Bonds is eligible to KodiakIsland Borough Alaska Resolution No FY201606 Page 10f 11 539 540 541 542 543 544 545 546 547 548 549 550 551 552 553 554 555 556 557 558 559 560 561 562 563 564 565 566 567 568 569 570 571 572 573 574 575 576 577 578 579 580 581 582 583 584 585 588 587 588 589 Section 20 Section 21 Section 22 Section 23 purchase the Bonds as member ofthe original underwriting syndicate eitherat public or private sale Ongoina Disclosure The Boroughacknowledges that underRule15c2-12 of the Securities and Exchange Commission the URUIeN the Borough may now or in thefuture bean obligated person In accordance withthe Rule and as the Bond Bank or FinancialInstitution may require the Borough shall undertake to provide certain annual financialinformation and operating data as shall be set forth in the Loan Agreement Miscellaneous All payments made by the Borough of or on account of the principal of or interest on the Bonds shall be made on theseveral Bonds ratably and in proportion tothe amount due thereon respectively for principal or interest as the case may be No recourse shall behad for the payment ofthe principal oforthe interest on the Bonds or for any claim basedthereon or on this Resolution againstany member of the Assembly or officer ofthe Borough or anyperson executing the Bonds TheBonds are notand shallnot be in any way debt or liability oftheStateof Alaska orof any political subdivision thereof except the Borough and do not and shallnot create or constitute an indebtedness or obligation either legal moral or otherwise of such state or of any political subdivision thereof except the Borough Severability If any one or more of the provisions of this Resolution shall be declared byany courtof competent jurisdiction to be contrary to law thensuch provision shall be null and void and shall be deemed separable from the remaining provisions of this Resolutionand shall in no way affectthe validity of the other provisions of this Resolution or ofthe Bonds Effective Date This Resolutionshari become effective uponpassage and approval ADOPTED BYTHE ASSEMBLY OFTHE KODIAK ISLAND BOROUGH THIS 1WENTIETHDAY OF AUGUST 2015 KODIAK ISLAND BOROUGHAZd. Jrrol Friend Borough Mayor Resolution No FY2018-06 Page 11 0111 Clerk Kodiak Island Borough Alaska THE STATE 0fALASJA GovBRNoI BILL WALKER Department of Education Early Development SCHOOLFINANCE FACILITIES 801 West 10 Street Suite 200 PC Box 110500 Juneau Akska 9981 10.S00 Telephone 907.465.0679 F-ax907.463.5279 Email EtizahethNudelmanalO5ka.gOV April 17 2015 Stewart McDonald Superintendent Kodiak island Borough School District 722 Mill Bay Road Kodiak Alaska 99615 Dear Mr McDonald This responds to your submittal of capital improvement project CIP applications received April 2015 Following an authorization by the legislature for debt reimbursement the Department of Education Early Development DEED accomplishes two administrative actions The first is to approve projects the second is to authorize projects for bond indebtedness and reimbursement Projectapproval occurs when an eligible scope and budget have been defined Project authorizationoccurs when certified election results are provided establishing voter approval and project agreement is signed Based on these provisions the projects havebeen determined eligible in both scope and budget under AS 14.11.100a 16 and are approved as listed below in addition since certified election results have been received from the boroughs October 2014 election DEED will begin project agreement preparation Project Title Approved Approved Reimbursement Reimbursement Amount Roofing Replacement Schools $1367248 70% East Elementary SchoolRenovation $1592841 70% Elementary Flooring Replacement Schools $813498 70% Peterson Elementary School Boilers and Controls $1019428 70% Kodiak Middle School Fire Alarm HVAC and ElevatorControls Replacement $2035193 70% Flooring Replacement Schools $383489 70% Site Paving and UST Replacement Schools $1797829 70% Playground Replacement Schools $668099 70% UST Replacement Schools $552375 70% TOTAL $10230000 If you have any questions please feelfreeto contact Kimberly Andrews at 465-1858 Seiel Eliza eth Nudelman Director cc Robert Tucker Director of Engineering and Facilities Kodiak Island Borough Gregg Hacker Maintenance and Operations Director Kodiak Island Borough School District LOAN AGREEMENT THIS LOAN AGREEMENT dated as of the 20th day of January 2016 between the Alaska Municipal BondBank the Bank body corporate and politic constituted as an instrumentality of theState of Alaska the State exercising public and essential governmental functions created pursuant to the provisions of Chapter 85 Title 44 Alaska Statutes as amended the Act having its principal place of business at JuneauAlaska and Kodiak Island Borough Alaska duly constituted second-class borough of theState the Borough WITNES SETH WHEREAS pursuant to the Act the Bank is authorized to make loans of money theLoanorLoanstogovernmentalunitsand WHEREAS the Borough is GovernmentalUnit as defined in the General Bond Resolution of the Bank hereinafter mentioned and pursuant tothe Act is authorized to accept Loan from the Bank to be evidenced by its municipal bonds WHEREAS the Borough desires to borrow money from the Bank in an amount not to exceed $8000000 for the purposes of financing portion of the costs of expanding and renovating the Kodiak High Schooland related capital improvements in the Borough and ii financingportion of the costs of scheduled renewaland replacement improvements toother Borough-owned school facilities and WHEREAS the Borough has submitted two applications tothe Bank for two Loans in an aggregate amount not to exceed $8000000 and the Borough has duly authorized the issuance of its General Obligation School Bond 2016 Series in the principal amount $1870000 and its General Obligation School Bond 2016 Series in the principal amount of $5140000 together the Municipal Bonds to be purchased by the Bank as evidence of the Loans in accordance with this Loan Agreement and WHEREAS the applications of the Borough contain the information requestedby the Bank and WHEREAS to provide for the issuance of bonds of the Bank toobtain from time to time money with which to make Loans the Board of Directors of the Bank the Board has adopted the General Obligation Bond Resolution on July 13 2005 as amended the General Bond Resolution and Series Resolution No 2015-05 adopted by the Board onDecember 15 2015 together with the General Bond Resolution the Bond Resolution authorizing the making of suchLoans tothe Borough and the purchase of the Municipal Bonds and WHEREAS pursuant to Resolution No 2013-02 adoptedby the Board on February 19 2013 the Board approved certain modifications tothe General Bond Resolution effective on the date when all bonds issued under the terms of the General Bond Resolution prior to February 19 2013 cease to be outstanding AMBB General Obligation Bonds 2016 Series One Kodiak Island Borough Loan Agreement NOW THEREFORE the parties agree TheBank hereby makes the Loans and the Borough accepts the Loans in the aggregate principal amount of $7010000 As evidence of the Loansmade tothe Borough and such money borrowed from the Bank by the Borough the Borough hereby sells to the Bank the Municipal Bonds of each Series in the aggregate principal amount with the principal installment payments and bearing interest from the date at the rate or rates per annum stated in Exhibit appended hereto The Borough represents that it has duly adopted or will adopt all necessary ordinances or resolutionsincluding Resolution No FY2016-05 and Resolution No FY2016-06 each adopted on August 20 2015 and Resolution No FY2016-23 adopted on January 17 2016 together the Borough Resolution and has taken or will take all proceedings required by law to enable it toenter intothis Loan Agreement and issue its Municipal Bonds tothe Bank and that when issued the Municipal Bonds will constitute direct and general obligations of the Borough and the full faith and credit of the Borough will be pledged to the payment of the Municipal Bonds all duly authorized by the applicable Borough Resolution Subject to any applicablelegal limitations the amounts to be paid by the Borough pursuant to this Loan Agreement representing interest dueon its Municipal Bonds the Municipal Bond Interest Payments shall be computed at the same rate or rates of interest borne by the corresponding maturities of the bonds sold by the Bank to obtain the money with which to make the Loans and to purchase the Municipal Bonds the Loan Obligations and shall be paid by the Borough at least sevenbusiness days before the interest payment date so as to provide funds sufficient to pay interest as the same becomes due on the Loan Obligations The amounts to be paid by the Borough pursuant to this Loan Agreement representing principal due on its Municipal Bonds the Municipal Bond Principal Payments shall be paid at least sevenbusiness days before the payment date stated in the Municipal Bonds so as to provide funds sufficient to pay the principal of the Loan Obligations as the same maturesbased upon the maturity schedule stated in Exhibit appended hereto Inthe event the amounts referred to in Sectionsand hereof to be paidby the Borough pursuant to this Loan Agreement are not made available at any time specified herein the Borough agrees that any money payable to it by anydepartment or agency of the State may be withheld from it and paid over directly tothe Trustee acting under the General Bond Resolution and this Loan Agreement shall be full warrant authority and direction to make such payment upon notice to such department or agency by the Bank with copy provided to the Borough as provided in the Act Inthe event Loan Obligations havebeen refundedand theinterestratesthe Bank is required to pay on its refunding bonds in any year are less than the interest rates payableby the Borough on the Municipal Bonds for the corresponding yearpursuant tothe terms of the Municipal Bonds thenboth the Municipal Bond Interest Payments and the Municipal Bond Principal Payments will be adjusted in such manner that the interest rate paidby the Borough on any principal installment of the Municipal Bonds is equal totheinterestrate paidby the Bank on the corresponding principal installment of the Banks refunding bonds and ii on AMBB/General Obligation Bonds 2016 Series One Kodiak Island Borough Loan Agreement Page present value basisthe sum of the adjusted Municipal Bond Interest Payments and Municipal Bond Principal Payments is equal to or less than the sum of the Municipal Bond Interest Payments and Municipal Bond Principal Payments due over the remaining term of the Municipal Bonds as previously established under this Loan Agreement Inthe event of such refunding of Loan Obligations the Bank shall present tothe Borough for the Boroughs approval revised schedule of principal installment amounts and interest rates for the Municipal Bonds If approved by the Borough the revisedschedule shall be attachedhereto as Exhibit and incorporated herein in replacement of the previous Exhibit detailing said principal installment amountsand interest rates The Borough is obligated to pay tothe Bank Feesand Charges Such Fees and Charges actually collected from the Borough shall be in an amount sufficient together with the Boroughs Allocable Proportion as defined below of other money availabletherefor under the provisions of the Bond Resolution and other money available therefor including any specific grants made by the United States of America or anyagency or instrumentality thereof or by the State or any agency or instrumentality thereof and amounts applied therefor from amounts transferred tothe Operating Fund pursuant to Section606 of the General Bond Resolution to pay as the same become due the Boroughs Allocable Proportion of the Administrative Expenses of the Bank and to pay as the same become due the Boroughs Allocable Proportion of the fees and expenses of the Trusteeand paying agent for the Loan Obligations The Boroughs Allocable Proportion as used herein shall mean the proportionate amount of the total requirement in respect to which the term is used determined by the ratio that the principal amount of the Municipal Bonds outstanding bear tothe total of all Loansthen outstanding to all Governmental Units under the General Bond Resolution as certified by the Bank The waiver by the Bank of any fees payablepursuant to this Section shall not constitute subsequent waiverthereof The Borough is obligated to make the Municipal Bond Principal Payments scheduled by the Bank The first such Municipal Bond Principal Payment is due at least seven business days prior tothe date indicated on Exhibit appended hereto and thereafter on the anniversary thereof each year The Borough is obligated to make the Municipal Bond Interest Payments scheduled by the Bank on semi-annual basis commencing sevenbusiness days prior tothe date indicated on Exhibit appended hereto and to pay any Feesand Charges imposedby the Bank within 30 days after receiving the invoice of the Bank therefor TheBank shall not sell and the Borough shall not redeem prior to maturity any portion of the Municipal Bonds in an amount greater than the Loan Obligations which are then outstanding andwhich are then redeemable and in the event of any such sale or redemption the same shall be in an amount not less than the aggregate of the principal amount of the Municipal Bonds or portion thereof to be redeemed ii theinterestto accrueon the Municipal Bonds or portion thereof to be redeemed to the next redemption date thereof not previously paid iii the applicable premium if any payable on the Municipal Bonds or portion thereof to be redeemed and iv thecost and expenses of the Bank in effecting the redemption of the AMBB/General Obligation Bonds2016 Series One Kodiak Island Borough Loan Agreement Page Municipal Bonds or portion thereof to be redeemed The Borough shall give the Bank at least 50 days notice of intention to redeem its Municipal Bond Inthe event the Loan Obligations with respect to which the sale or redemption prior to maturity of such Municipal Bonds is being made havebeenrefundedandthe refunding bonds of the Bank issued for the purpose of refunding such Loan Obligations were issued in principal amount in excess of or less than the principal amount of the Municipal Bonds remaining unpaid at thedate of issuance of such refunding bonds the amount which the Borough shall be obligated to pay or the Bank shall receiveunder item above shall be the principal amount of such refunding bonds outstanding In the event the Loan Obligations havebeenrefundedandthe interest the Bank is required to pay on the refunding bonds is less than the interest the Bank was required to pay on the Loan Obligations the amountwhich the Borough shall be obligated to pay or the Bank shall receiveunder item ii above shall be the amount of interest to accrue on such refunding bonds outstanding Inthe event the Loan Obligations havebeen refunded the amount which the Borough shall be obligated to pay or the Bank shall receiveunder item iii above when the refunded Loan Obligations are to be redeemed shall be the applicable premium if any on the Loan Obligations to be redeemed Nothing in this Section shall be construed as preventing the Borough from refunding the Municipal Bonds in exchange for new Municipal Bonds in conjunction with refunding of the Loan Obligations 10 Simultaneously with the delivery of the Municipal Bonds tothe Bank the Borough shallfurnish to the Bank evidence satisfactory tothe Bank which shall set forth among other things thatthe Municipal Bonds will constitute valid and binding general obligations of the Borough secured by pledge of the full faith and credit of the Borough 11 Invoices for payments under this Loan Agreement shall be addressed to the Borough Attention Finance Director 710 Mill Bay Road Kodiak Alaska 99615 The Borough shall give the Bank and the corporate trustoffice of the Trustee under the General Bond Resolution at least 30 days written notice of anychange in such address 12 The Borough hereby agrees to keep and retain until the date six years afterthe retirement of the Municipal Bonds or any bond issued to refund the Municipal Bonds or such longerperiod as may be required by the Boroughs record retention policies and procedures records with respect tothe investment expenditure and use of the proceeds derived from thesale of its Municipal Bonds including without limitation recordsschedules bills invoices check registers cancelledchecksand supporting documentation evidencing use of proceeds and investments and/or reinvestments of proceeds The Borough agrees that all records required by the preceding sentence shall be made available tothe Bond Bank upon request 13 Prior to payment of the amount of the Loans or any portion thereof and the delivery of the Municipal Bonds to the Bank or its designee the Bank shall have the right to cancel all or any part of its obligations hereunder if AMBB/General Obligation Bonds 2016 Series One Kodiak Island Borough Loan Agreement Page Any representation warranty or other statement made by the Borough to the Bank in connection with its application to the Bank for Loan shall be incorrect or incomplete in any material respect The Borough has violated commitments made by it in the terms of this Loan Agreement The financial position of the Borough has in the opinion of the Bank suffered materially adverse change between the date of this Loan Agreement and the scheduled time of delivery of the Municipal Bonds to the Bank 14 The obligation of the Bank under this Loan Agreement is contingent upon delivery of its General Obligation and Refunding Bonds 2016 Series One and receipt of the proceeds thereof 15 The Borough agrees that it will provide the Bank with written notice of any defaultin covenants under the Borough Resolution within thirty 30 days afterthedate thereof 16 The Borough agrees that it shall file its annual financial statements with the Municipal Securities Rulemaking Board not later than two hundred ten 210 days after the end of each fiscal year of the Borough for the term of the Municipal Bonds The Borough further agrees that filings under this Section 16 shall be made in connection with CUSIP Nos 011 79P 011798 and 011 79R Additional oralternate CUSIP numbers may be added from time to time by written notice from the Bank tothe Borough The Borough agrees that if it receives from the Bank CUSIP numbers in addition to those set forthinthis Sectionthen the Borough shall make its filings using both CUSIP numbers herein stated and any additional CUSIP numbers 17 The Borough agrees that it shall not take or omit to take any action lawful and within its power to take which action or omission would cause interest on the Municipal Bond of either seriesto become subject tofederal income taxes inaddition tofederal income taxesto which interest on such Municipal Bonds is subject on thedate of original issuance thereof The Borough shall not permit any of the proceeds of the Municipal Bonds or any facilities financed with such proceeds to be used in any manner that would cause the Municipal Bonds to constitute private activity bond within the meaning of Section 141 of the Code The Borough shall make no use or investment of the proceeds of the Municipal Bond that will cause the Municipal Bond to bean arbitrage bond underSection 148 of the Code So long as the Municipal Bond is outstanding the Borough shall comply with all requirements of said Section 148 and all regulations of the United States Department of Treasury issued thereunder to the extent that such requirementsare at the time applicable and in effect The Borough shall indemnify and holdharmless the Bank from any obligation of the Borough to make rebate payments to the United States under said Section 148 arising from the Boroughs use or investment of the proceeds of the Municipal Bond 18 Upon request of the Bank the Borough agrees that if its bonds constitute ten percent 10%or more of the outstanding principal of municipal bonds held by the Bank under its General Bond Resolution it shall execute continuing disclosure agreement preparedby the AMBB/General Obligation Bonds2016 Series One Kodiak Island Borough Loan Agreement Page Bank for purposes of Securities and Exchange Commission Rule l5c2-12 adopted under the Securities and Exchange Act of 1934 19 The Borough agrees that if its bonds constitute ten percent 10%or more of the outstanding principal of municipal bondsheld by the Bank under its General Bond Resolution it shall provide the Bank for inclusioninfutureofficial statements upon request financial information generally of the type included in Appendix under the heading Summaries of Borrowers Representing 10%or More of Outstanding Principal of Bonds Issued Under the 2005 General Bond Resolution tothe Official Statementandattached hereto as Exhibit 20 If any provision of this Loan Agreement shall for any reason be held to be invalid or unenforceable the invalidity or unenforceability of such provision shall not affect any of the remainingprovisions of this Loan Agreement and this Loan Agreement shall be construed and enforced as if such invalid or unenforceable provision hadnot been contained herein 21 This Loan Agreement may be executed in one or more counterparts any of which shall be regarded for all purposes as an original and all of which constitute butone and the same instrument Each party agrees that it will execute any and all documents or other instruments andtakesuch other actions as are necessary to give effect to the terms of this Loan Agreement 22 No waiver by either party of any term or condition of this Loan Agreement shall be deemed or construed as waiver of any other term or condition hereofnor shall waiver of any breach of this Loan Agreement be deemed toconstitute waiver of anysubsequent breach whether of the same or of different sectionsubsection paragraph clause phrase or other provision of this Loan Agreement 23 Inthis Loan Agreement unless otherwise defined herein all capitalized terms that are defined in Article of the General Bond Resolution shall have the same meanings respectively as such terms are given in Article of the General Bond Resolution 24 This Loan Agreement merges and supersedes all prior negotiations representations and agreements between the parties hereto relating tothe subject matter hereof and constitutesthe entire agreement between the parties hereto in respect thereof PAGE FOLLOWS AMBB/Oeneral Obligation Bonds 2016 Series One Kodiaklsand Borough Loan Agreement Page IN WITNESS WHEREOF the parties hereto haveexecuted this Loan Agreement the day and year first above written ALASKAMUNICIPAL BOND BA 4cutive Director KODIAK ISLAND BOROUGH ALASKA By KARLETON SHORT Finance Director AMBBiGeneraL Obligation Bonds 2016 Series One Kodiak Island Borough Loan Agreement Page EXHIBIT $1870000 Kodiak Island Borough Alaska General Obligation School Bond 2016 Series Series Municipal Bond Due Principal Interest August Amount Rate 2016 30000 5.000% 2017 65000 5.000 2018 65000 5.000 2019 70000 5.000 2020 75000 5.000 2021 80000 5.000 2022 80000 5.000 2023 85000 5.000 2024 90000 5.000 2025 95000 5.000 2026 100000 2.000 2027 100000 4.000 2028 105000 4.000 2029 110000 2.625 2030 110000 3.000 2031 115000 3.000 2032 120000 3.000 2033 120000 3.000 2034 125000 3.125 2035 130000 3.250 Principal installmentsshall be payable on August in each of the years and in the amounts set forth above Interest on theSeries Municipal Bond shall be payable on August 2016 and thereafter on February and August of each year Prepayment Provisions The Series Municipal Bond principal installments stated to mature prior to August 2026 are not subject to prepayment prior to maturity Optional Prepayment The Series Municipal Bond principal installments due on or after August 2026 are subject to prepayment in whole or in part at the option of the Borough on any date on or after February 2026 at price of 100%of the principal amount thereof to be prepaidplus accrued interest tothedate fixedfor prepayment AMBB/General Obligation Bonds 2016 Series One Kodiak Island Borough Loan Agreement Page A-I $5140000 Kodiak Island Borough Alaska General Obligation School Bond 2016 Series Series Municipal Bond Due Principal Interest August Amount Rate 2016 $235000 5.000% 2017 440000 5.000 2018 465000 5.000 2019 490000 5.000 2020 515000 5.000 2021 540000 5.000 2022 570000 5.000 2023 595000 5.000 2024 630000 5.000 2025 660000 5.000 Principal installmentsshall be payable on August in each of the years and in the amounts set forth above Interest on theSeries Municipal Bond shall be payable on August 2016 and thereafter on February and August of each year Prepayment Provisions The Series Municipal Bond principal installments are not subject to prepayment prior to maturity AMBB/General Obligation Bonds2016 Series One Kodiak Island Borough Loan Agreement Page A-2 EXHIBIT AMBB/General Obligation Bonds 2016 Series One Kodiak Island Borough Loan Agreement Page B-I OHSUSA76430733 .5 APPENDIX Summaries of Borrowers Representing 10%or More of Outstanding Principal of Bonds Issued Under the 2005 General Bond Resolution Iconalpeninsula borough 4enerat Fund General Obligation Financial Summary Municipal Financial Position 2011 2002 2013 2014 2015 AVerage Properly Tao Collections $450 $4.50 $4.50 $4.51 54.543 5451 Iota Years Collectiun $29047448 $30401500$30798608$31668476 $31332596930449721 TotalCollection Rate 99.96%99.94%99.92%99.74%98.89%99.69 Enpendilures TotalRevenue and General Obligation Debt 72.16355 71347868 72452478 73076361 784276%973.55357 ____ 4L8200dI 33910000 3023000 26820000 45055000 41820000 __________11.4177 $612 $534 $473 $792 $732 $732 30910000 TotalRevenue and GO DebtfA.V rnr 0.5.3% GeneralEconomicand Demographic Data 2011 2012 2013 2014 2015 Annu Growth lopuation 55400 56369 56756 56862 571471 AssessedValue 639353100066332411006716OlO000 696019600 6932443100 041% Assesoed Value Per Capita 15.407 117675 118331 122115 121709 Top lOTau Payers asof TotalAssessedValue 15.23%14.35%16.16%17.05%I l7.05%.I my mostrecent year 2515304 ay 3443 UnrerersedFend Bal.esei NetNote ltereeebh he Cityof tinner it he content tI t37349$08944137 ted 0%94a837 peetedv to bttnltetire netorol gor eon00eitv neon by eneetoot henhiod prpettie.r 30230000 1.46 26820000 1411% 45055000 45% Fund BalanceEupendiluren DverallMunicipalDebtPosition 3071 Revenue DebiGovernmentalFunds 30%22711 TotalGeneral Obligation Debt 21 General Obligation Debt Pee Capita D- CentralPeninsula General Hospital FINANCIAL SUMMARY 2011 2012 2013 2014 2015 $67842931$64853893$69429959$71387990$93151047 217003022780348735197813 35508443 37638411 1009724111421461113227291644788718838950 3584121 633493 500000 46934025069037 31275450 18468485 19105718 29383574 29863006 32652905 38942891 122330313134095908146313507191966077212108821 101279075116849605123951269126713712144009565 99255770 102247165104364018117067440 8004562795930580666888471959 6451031 9589273 1374479914283006 18470166 1105595 808253154165710705831300456 8781020 122031421321242317169710 Change in Net Position 5558381 8833863 142081121322706717176970 ASSETS Capital Assets net of depreciation Cash Cash held for Plant Replacement RestrictedAssets Unspent bond proceeds OtherAssets TotalAssets LIABILITIES AND NET ASSETS Revenue Bonds Payable 3249000033890000 GO Bonds Payable 3599000032255000 3013000027905000 25670000 Other Liabilities 1096561018041771181762582033676124137535 Total Liabilities 46955610 50296771 48306258 8073176183697535 NET ASSETS 753747038379913798007249 111234316128411286 Operating Revenues Operating Expenses 86771449 Depreciation 8056595 Operating Income Loss Non-Operating Revenue Expense Net Income Loss BeforeContribution 5345436 Capital Contributions 212945 52843 2004970 14644 7260 D-2 Ill ANLbOKUUI1 Ut-SI 3ENERAL OBLIGATIONFINANCIAL SUMMARY 4unicipal FinancialPosition 2011 2012 2013 2014 2015 Average roperty Tax Collections Borrowers Property Tax Rate per 5110l 56.110 $6.00 $6.00 $6.00 $6.00 $6.01 Municipal Levy 55799410 $5904617 $5957735 $5901738 $6032826 $5919263 Current Years Collections 35753039 35874918 35893452 35842721 36006776 35.074181 CurrentCollection Rate 99.20%9950%98.92%99.10%99.57%99.24% Total Years Collections $5807869 $590921 $5893452 $5842721 $600676 $5892028 Total Collection Rate 100.15%l 100.08%98.92%99.00%99.5%99.54% General Fund Unreserved Ending Fund Balance 11508475 13584873 14268394 15996580 14720675 14015799 Expenditures 23260649 24075729 23691912 23628379 30621436 2505562 Fund Balance/Expenditures 49%56%60%68%48%5638% Total Revenues 24709916 26584.728 25953885 26507173 29227140 26596568 lnlergovernmenlal Revenues 2380298 2659323 69.860 2771990 250749 2662644 Percentage Intergovernmental 10%10%111%111%li%10.02% Overall Municipal Debt Position Revenue Debt Enterprise Punds 68807401 68593411 io6 108940000 123215000 Revenue Debt Governmental Funds 165750 156000 146250 202641 189409 General Obligation Debt lovernmenLal Funds 36300000 32290000 31020000 28635000 25990000 General Obligation Debt Enterprise Funds TotalGeneral Obligalion Debt 36300000 32290000 31020000 28635000 25990000 Total Revenueand General Obligation Debt 105273151 101039411 137312072 137777641 149394409 Governmental GO Debt/Taxable AssessedValue 3.69%3.26%3.10%2.9l%2.50% Total Revenueand GO Debt/A.V 11.69%111.211%13.72%14.11%l4.86% General Obligation DebtPer Capita 54138 $3607 $3415 $3152 $2068 Total Revenueand GO DebtPer Capita $121100 $11287 $15116 $15167 $16108 and Demographic Data 2011 2012 8952 2013 9084 2014 2015 9061 Annuah TaxableAssessedValue 985073129 990910238 1001066784 9836230101005471000 222 AssessedValuePer Capita 112 2115 110M94 Ill 20 l842$1 l0967J 1axPaymasa%olAssessed Value 764%757%757 7.57%737% The Bmu0h lu notvnplet.t eelseer 1115 aedS elthethe pwperatrn ttss shIv D-3 City and Borough ofSitka Electric Enterprise Fund Financial Summary Assets Cash Restricted Assets OtherAssets Construction in Progress Utility Plant in Service Total Assets Liabilities andNetAssets Liabilities Other Liabilities RevenueBonds Payable Deferred loss/premium on bonds Revenue Notes Payable TotalLiabilitIes 2011 2012 2013 24320421314506502880318713505669 4447481 68711643595875211974591812195521733477 50101677266275 13897615117771537988506 11.646987 1808672458930539137885040 12535308 63103150 617750035990034359508277217550674 110951889 122174527 182729143 240798094 264255446 172277224771826355564130178173355323 487000004757000079485000105100000 119510000 1471509 1711547 5943338 67422936347870 880018885354987973608797360810050744 606944695687113399757510132833718 139263936 NetAssets 502574206530339482971633107964376 124991510 OperatingRevenues OperatIngExpenses tdministrative and General Dperation and Maintenance Depreciation Operating Income Nonoperatingrevenue expense InvestmentIncome Interest Expense Other NetIncomebefore contributions and transfers 11401523116113191207755414240772 17118321 17396982003768 197549228600662406734 5257342591489551520284964074 7443239 19875581971739198619518417121814707 2416925 1720917296383945749205453641 490986459107 314600196399313069 172519828486391678238426419 316203 625748572946812866463877 1.182713 42867 217314751577665914384 Capital contributions Extraordinary Item NetPension Obligation Relief Transfer In Out net Change In NetAssets Population of City and Borough ofelectric customers KwH Sold 40392375266050 17169455 19455106 9986217 119824139806 325771 379871 1126533 _____________998128 53417745362989 18670245 2499274317027134 8773 8952 9084 9098 9061 5282 5309 5403 5490 5683 111795344 111048623111155330 111155330 105293250 Note $2500000 transferredinto Rate Stabilization Fund in FY2O1S $2006696 transferred Out of Rate Stabilization Fund in FY2015 TotalofrateStabilization Fund as of June 30 2015 -$3001304 The Borough has not completed its fiscal year 2015 audit as of thedate ofthe preparation ofthis table 2014 2015 RevenueBondDebt Service 34779593467567452924050451587158839 RevenueBond Coverage 1.25 1.41 1.43 1.27 1.34 1.27 D-4 CITY AND BOROUGH OF SITKA HARBOR ENTERPRI SE FUND FINANCIAL SUMMARY 2011 2012 2013 2014 2015 ASSETS Plant In-Service net of depreciation 14789299141225911355023113153475 20580565 land 90000 90000 90000 90000 90000 Construction Work in Progress 20229 57838 665476 7824365 939917 Cash 3733467 4735101 65991876616954 7595507 RestrictedAssets 3615663 589166 317566 OtherAssets 134257213393891216385 15248981036361 TotalAssets 1997556720344919257369422979885830539916 LIABILITIES ANDNET ASSETS RevenueBonds Payable 45694863840000 3705000 Other Liabilities 1405227 11560031144138 16890331592094 Total Liabilities 14052271156003 5713624 5529033 5297094 NET ASSETS 1857034019188916200233182426982525242822 Operating Revenues 28548583154885 3096419 31642523365977 Operation and Maintenance 24921102434329 1708210 2454599 2194755 Administrative and General Depreciation 899956 986619 668511 666074 669102 Operating Income Loss 537208 266063 719698 43579 502120 Non-Operating Revenue Expense 46509 155306 156844 776434 375830 Net Income Loss Before Contribution 490699 110757 876542 820013 877949 Capital Contributions 16908732549949 3458599 122108 Net Transfers-In Out 3804600 675000 42141 32105 27060 Special item NPO/OPEB writeoff __________________________________________________________________ Change in Net Assets 5004774 3114192 834401 4246.507 972997 Population of City 8773 8952 9084 9098 9061 Revenue Bond Coverage No Harbor No Harbor No payments of Bonds Bonds PI 5.16 5.31 The Borough has not completed its fiscal year 2015 audit as of thedate of the preparation of this table D-5 CITY OFKETCHIKAN GENERALOBLIGATION FINANCIAL SUMMARY Munkir.xI Fin.inciI Poxilion lroprft Ta ColIcclinns Bo1owiPpilv T.t K.i iei $1001Nr_______tc.05 utniejit u11 tin Rile ToI \eIi I1icix nllcItin riI Lnxerd Font 2012 S-x4S 15 utI 2013 2014 Average 2.o2$40 1010 2011 .1 14s piiItua Fintil Fi.il.tn/Fs Iilnhn ctI lint iOV1UeZiiii nitle PtixLt3 lO\iiCi1t1l 4.3t33o7$15 83 271nlh $5 537 451i.271so x3.7 is.o sI2lji $5 i57 jfV 1111 KJt xs.ll 2iX.320 3.350.0%3723002$3.I35.143.0 Rrittx rxellSi ilet it ie tintS .lITt 75 1I 23533.053 IL Resrnu Dttt Coxeian..iti.il FitiI Cnitl lt.tIicnr.lt CnvninenttI Fi.ittds t...xjxl TIal .nti ni ii It.i on L1ntI TctxI Sxcnti ind C.tsI hiiicn kI tO.WtJ 523131 10820 1.73311 LnVenuitni ilil I..LtnUI .Asint.nxl Oxo no LU Vet Cii \tlth nUS n.il Cl1iF.1tn SI ins i.soscl.4so l3.73i052 14533 lIxi Ot 41 ti IiTiiTloTh3T7 31 712Ior 727i0 51452512 121552 ll.iI 1i iii nij .C L5 iii vi j5 I.ne-il 1i1 Vs-lit Pci ltlii -I3i Tôti r.-n in .ini tCI rxl-i Per .iHt.i Ott 141 i-i Uenr.tI L.unonik tn.I Unrnu3r.lpIlk D.tl.i 2010 Poptil.iticn SOSO .Atnnd \Iui Jtl .1111 .Azed \xlu Per Tn ri .t nil 13 2011 217t2 5.112 001L .tXx 2017 2014 8313 S../3S00 8513 D-6 CITY OFKETCHIKAP4 1ETCNIKAN PUBLIC UTILIT1ES ENTERPRISEFUND FINANCIAL SUMMARY 2010 2011 20121 2013 2014 ASSETS Uliltty Plan l-Stivce $67177925 $69.018.328$81.0 15.323 $78096.60 12351731 Construction Work ri Prooress 14188.563 17131018812349530908014 3621229 Cash I26005 130353613 1616100920.64632616770070 RestticledAssets 3050592 2.963.566 2.6950852901348 2986460 DeferredOutflOw of Resources 2112%129.454 61284 OtherAssets 12118366 11991790 8757.26510440600 9286515 Total Assets 109.701451 14.950970 117570.353 143122343145085297 LIABILITIES Revenue Bonds Payable 20185076 18834880165682502700060226021342 Other Ltabllilies 4030471 4.096.401 54774371242332910435730 TotalUabittties 24216447 2373136122045.696 40.32393136457082 NET POSITION 85485004 91.21060995524657102798412 108.628215 Opewlitig Revenue 32975154 3417294 3.4.802.7-18 3771731535986917 operatIon andMaIntenance 19060.630 19907855210926422568713123307000 Administritive and General 603 40 097421 411608 5426 532 9754 989 Depreciation 5932099 5.892.419 6.872767 6.264041 6.908.978 Payment lieu 01 Tass Operating Income Loss 2.379.011 2185210 525731 339611 l1964 Non.Operatinq Revenue Expense 479652 303607 1306002 560.071 553272 NetIncome Loss BeloreContribution 1899359 1.82 1603 39729 1229060 538.308 Contributions 36 18.051 864 1002 5016767 8.2888 IS 7154.111 Special item Transler Net Assets Swan Lake-Lake Tvee Inteitie Prolect Transfer Payment In Lieu of Taxes 728.000 t728000 728.000 1786.000 786.000 Change In Net Assets 4980.410 573.1605 .1428.406 7273755 5829803 PopuLilloir of Service Ajea 13477 13686 13.750 13.938 13856 Populalion CIty 8050 8142 8291 8313 0314 ii orElectric Cusloinete 7.410 7.443 7518 75 14 7606 01 Telephone Access Lines 7103 7057 6.434 6083 5863 401 Waler Customers 3233 3247 3213 3211 3162 kevenue l3ond t.oveago 131 53 02 135 Waler is univ provided willilitlIre Cdv Criange in accounting slandards pavmenl in lieuoftax must be reported as transfer The 2012 Audit v.ere restated and reflected in Ihe 2013 Comprehensive Annual Financial Report D-7 CITYOF KETCHIIcAN PORT FINANCIAL SUMMARY 2010 2011 20121 2013 2014 ASSETS Cash S4364226 S2373.808$2285517 2900.167 5504277 Port lacihues net 43642941 42020640 37766/76 53490542 54.312.543 Construction Work in Progress 11 6782 5531746 50660lB 5.449151 200.947 ReslnctelAssets 5307521 5623924 6087097 6505733 8.124101 Other Assets 1281.312 3670.192 .1236551 6840 33 4.09.1040 total Assets 55112 /08 59.220310 75.27512312835908 LIAB1LITIES General Obhigabon Bonds Payable795.000 540000 270.000 Revennci Bends Payable 35830.00035000000 34315001 33505000 326600011 Othe Liabilthes 3.134814 2847180 1.072313 1699.380 1699380 Total Liabilities 397598143847718035657313 35.20438033.520042 NETPOSITJON 1595297420.14313029779676 40071333 39315866 Operating Revenues 8.000492 7986404 8592.255 1.15.920 8578.059 Operalion and Maintenance 53192523957909 3888525 4.4 64734561103 Depreciation 1436527 1.401754 1359513 1636863 1.501253 Property Taxes 167219 52762 12.575 165627 165.112 operating Income L0s5 2.413919 4201642 292695/2263291 NonOperating Revnne Expensj 1903.42 2.043.804 912634 2089.7 17 Net Income Loss Betore Contributi 1035927 $301153425.204 2.014323 174574 Contnbutions and CapItal Grants 5109444654901 62144 16 0676.543 3.407.753 817880199 5018804 Transler Payment in eu Cl Taxes 295010 295.000 295000 31000030.000 Change in Net Position 1611983 4.790.156 9336442 10.291.667 755477 1.25 Annual DebtService 2.00 2.24 3.36 3.03 2.32 .0 Annual Debt Serviceipeserves ccoun9Repair and Replacement Fund/SPH LeasePayments 99 67 42 09 Unaudited Sot Ships 26 28 34 37 uf Clls/Stups 429 426 467 456 468 01 Water Passenqers 020914 830547 885799 938.12$877.589 Reflects statistical mnInrnl4minn prnvirled by Inc Kelchikan Visitors Rmirenmi TIme 2012 AudI ste mesluted almd ItIlected iii tIme 2013 Cuuipiehmermsive Aiiimuul Fviaimut Report D-8 CITY AND BOROUGH OFJUNEAU FINANCIAL SUMMARY General GovernmentalFund Municipal FinancialPosition Property Tax Collections Borrowers Property Tax Rate per $1000 Municipal Levy CurrentYears Collections Current Collection Rate Total Years Collections TotalCollection Rate GeneralFund Unassigned Plus EmergencyOperating Rex GASB54 Expenditures Fund Balance/Expenditures Total Revenues Intergovernmental Revenues Percentage Intergovernmental sverall Municipal Debt Position RevenueDebt Enterprise Funds RevenueDebt Governmental Funds General Obligation Debt GovernmentalFunds General Obligation Debt Enterprise Funds _____________ Total General Obligation Debt Total Revenue_and_General_Obligation_Debt _____________ Governmental GO Debt/Taxable Assessed Value Total_Revenue_and GO Debt/A.V ____________ General_Obligation_Debt_Per_Capita _____________ Total Revenue_and_GO_Debt_Per_Capita _____________ GeneralOconomic and Demographic Data 1opuiation TaxableAssessed Value 398 Assessed Value Per Capita TplOTc sa tAn fl0 nO 2011 2012 2013 2014 2015 Average ..... 4275 D-9 CITY AND BOROUGH OFJUNEAU HARBOR ENTERPRISE FUND FINANCIAL SUMMARY il ZQJZ 2014 2Qi ASSETS PlantIn-Service net of depreciation $13827335 $12844129$11875368$14325870 $17517553 Construction Work in Progress 29889294334997694239797440419697 50214768 Cash 47285224660755 3466374 4030992 3975676 Restricted Assets 1070270311196479 10946328105546149581172 OtherAssets 764741 8478695434076799071718645 TotalAssets 5991259563049001 692294517001108083007814 LIABILITIES AND NET ASSETS Revenue Bonds Payable 9700000 9691595 93804349033637 9758734 Other Liabilities 2110290 2140909 140136520505003105738 Total Liabilities 1181029011832504 107817991108413712864472 NET ASSETS 48102305 51216497 58447652 5892694370143342 Operating Revenues 2854858 3154885 317327235084304202862 Operation andMaintenance 2492110 2434329 2498178 2814717 3347050 Administrative and General Depreciation 899956986619968761 10037071150701 Operating Income Loss 537208266063 293667 309994 294889 Non-Operating Revenue Expense 46509155306 214686 128433501698 NetIncome Loss Before Contribution 490699110757 508353 181561 206809 CapitalContributions 1690873 2549949 7392466 6608525788674 Net Transfers-In Out 3804600675000 500000 6224425 Special item NPOIOPEB writeoff ___________________________________________________________Change in Net Assets 5004774 3114192 7384113479291 12219908 Population of City 31275 32441 32660 3306433064 RevenueBond Coverage 1.19 1.79 1.21 1.67 2.60 D-10 CITY ANb BOROuGH OF JUNEAU PORTDEVELOPMENT SPECIAL REVENUE FUND FINANCIAL SUMMARY 2011 2012 2013 2014 2015ASSETS PlantIn-Service net of depreciation Construction Work in Progress Cash 4428233 208085252013 710122709760 Restricted Assets OtherAssets 314814 269712484639 294257 408137 TotalAssets 4743047 61627 232626365269 3117897 LIABILITIES ANDNET ASSETS RevenueBonds Payable Other Liabilities 151020 349585 642980 Total Liabilities 151020 349585 642980 NIETASSETS 4743047 6162781606 15684 2474917 Operating Revenues 2557851 26340802825479 28645782868633 Operation andMaintenance 2800 5500 5500 55005500 Administrative andGeneral Depreciation Operating Income Loss 25550512628580 28199792859078 2863133 Non-Operating Revenue Expense Net Income Loss BeforeContribution 2555051 262858028199792859078 2863133 CapitalContributions NetTransfers-In Out 15000007310000 28000002925000 403900 Change in Net Assets 1055051 4681420 19979 65922 2459233 Population of City 31275 32441 3266033064 33064 D-1 9978298 9598352998871994479 15 8459546 13650000 13050000117050001159622910204712 878190904428 2052663 1132323 996579 14528190 139544281375766312728552 11201291 4549892 43560763768944 3280637 2741745 132263466243 61553120890 455592 477928 3271360964 The Bond Bank has received notification from senior management of WildflowerCourt that for calendar year 2013 and 2014 Wildflower Court fell short of the required debtservice coverage ratio of 1.15 times Per section 5.1b of theloan agreement between the City and Borough of Juneauand Wildflower Court WildflowerCourt is working with the City and Borough to identify measures to returnthe facility to compliance with thedebtservice coverage requirement of theloan agreement Audited financial statements for WildflowerCourt for fiscal year 2015 were notavailable as of the date of the preparation of this table City and Borough of Juneau Conduit Debt WILDFLOWER COURT not for profit organziation FINANCIAL SUMMARY ASSETS 2010 PlantIn-Service Cash Restricted Assets OtherAssets 2011 Total Assets 2012 5674338 1255867 1735178 1312915 2013 4909305 1582128 1707402 1399517 2014 4620999 1752043 2170928 444749 LIABILITIES AND NET ASSETS Bond Debt Other Liabilities TotalLiabilities 4734678 1437085 1489365 1.786.787 3771100 1970693 1450054 1267699 NETASSETS DEFICIT Operating Revenues OperatingExpenses Depreciation Operating Income Loss 10361609 9802944 937147 378482 Non-Operating Revenue Expense 10859195 9894353 832579 Change in Net Assets 10841324 9594317 780765 27924 11057791 9666530 935669 Revenue BondCoveraqe 11447862 9961681 1008253 1.01 350558 193816587132488305538892 1.33 1.32 1.12 1.10 D-12 CITY AND BOROUGH OFJUNEAU BARTLETTREGIONAL HOSPITAL FINANCIAL SUMMARY 2011 2012 2013 2014 2015 ASSETS Plant In-Service net of depreciation $72772410$74566327$74002798 $69208456$63710212 Construction Work in Progress 6866781 62022242826314 2284253647565 Cash 14990308173861692611383338596921 44834531 Restricted Assets 10160114 65494985490768 53276735327519 OtherAssets 23011263 23462113 252302062052816423810042 Total Assets 127800876128166331133663919 133889639141329869 LIABILITIES AND NET ASSETS Revenue Bonds Payable 25570000 24926795 2530467924346618 24346618 Other Liabilities 11391053 89998678829067 1103387546306102 Total Liabilities 3696105333926662341337463538049370652720 NET ASSETS 90839823 94239669 99530173 9850914670677149 Operating Revenues 90680836 95026373 84250207 8019827490281184 Operation and Maintenance 83883389 89411913 76967444 7882047692676249 Administrative and General Depreciation 6552177714529070012957086559 6815728 Operating Income Loss 245270 1530830 281468 57087619210793 Non-Operating Revenue Expense 1579634 33063664119820 3610234 14405416 NetIncome Loss Before Contribution 1824904 17755364401288 2098527 5194623 Capital Contributions 89002471910 134658 Net Transfers-In Out 1152600 1152400 112300010775001054500 Special item NPOIOPEB writeoff ___________________________________________________________Change in Net Assets 30665063399846 5658946 1021027 6249123 Population of City 31275 3244132660 3306433064 RevenueBond Coverage 3.63 3.00 7.34 2.50 8.97 D-13 OFFICIAL STATEMENT DATED JANUARY 20, 2016 New Issue Fitch Rating: AA+ Book-Entry Only Standard & Poor’s Rating: AA (negative outlook) (See “Ratings” herein.) In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986. In the further opinion of Bond Counsel, interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel also is of the opinion based upon existing laws of the State of Alaska that interest on the 2016 Series One Bonds is exempt from taxation by the State except for transfer, inheritance and estate taxes. See “TAX MATTERS” herein. $33,015,000 ALASKA MUNICIPAL BOND BANK General Obligation and Refunding Bonds, 2016 Series One Dated: Date of Delivery Due: As shown on inside cover The Alaska Municipal Bond Bank (the “Bond Bank”) is issuing $33,015,000 principal amount of General Obligation and Refunding Bonds, 2016 Series One (the “2016 Series One Bonds”). The 2016 Series One Bonds initially will be issued as fully registered bonds, in book-entry form only, registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”), which will serve as depository for the 2016 Series One Bonds. Individual purchases of the 2016 Series One Bonds will be made in principal amounts of $5,000 or integral multiples thereof within a single maturity and interest rate. Purchasers of the 2016 Series One Bonds will not receive certificates representing their beneficial ownership interests in the 2016 Series One Bonds. Interest on the 2016 Series One Bonds will accrue from the date of delivery of the 2016 Series One Bonds, or from the most recent interest payment date to which interest has been paid, and is payable on each February 1 and August 1, commencing August 1, 2016. The Bank of New York Mellon Trust Company, N.A., of San Francisco, California, as the Trustee and Paying Agent for the 2016 Series One Bonds, will make principal and interest payments to DTC. Disbursement of such payments to DTC Participants is the responsibility of DTC. Disbursement of such payments to the Beneficial Owners is the responsibility of the DTC Participants. See “DESCRIPTION OF THE 2016 SERIES ONE BONDS” and “APPENDIX G – DTC AND BOOK-ENTRY SYSTEM.” The 2016 Series One Bonds are subject to redemption prior to their stated maturity dates. See “DESCRIPTION OF THE 2016 SERIES ONE BONDS – Optional Redemption” and “Mandatory Redemption.” The 2016 Series One Bonds are general obligations of the Bond Bank, and the full faith and credit of the Bond Bank are pledged for the punctual payment of the principal of and interest on the 2016 Series One Bonds. The 2016 Series One Bonds are equally and ratably secured by the pledge and assignment of all Municipal Bonds acquired by the Bond Bank under the Bond Bank’s 2005 General Bond Resolution on a parity with other Bonds of the Bond Bank heretofore or hereafter issued under the 2005 General Bond Resolution. The 2016 Series One Bonds are the thirty-fourth series of Bonds issued under the 2005 General Obligation Bond Resolution. The 2016 Series One Bonds do not constitute a debt or other liability of the State of Alaska, and the 2016 Series One Bonds do not directly, indirectly or contingently obligate the State of Alaska to levy any form of taxation or make any appropriation for the payment of the 2016 Series One Bonds. Neither the faith and credit nor the taxing power of the State of Alaska is pledged for the payment of the 2016 Series One Bonds. The Bond Bank has no taxing power. See “SECURITY FOR THE 2016 SERIES ONE BONDS.” The 2016 Series One Bonds are offered when, as and if issued, subject to the approving legal opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Bond Bank. Certain legal matters will be passed upon for the Governmental Units by their respective bond counsel. It is expected that the 2016 Series One Bonds in definitive form will be issued and available by Fast Automated Securities Transfer for delivery through the facilities of DTC in New York, New York, on or about February 2, 2016. $33,015,000 Alaska Municipal Bond Bank General Obligation and Refunding Bonds 2016 Series One MATURITIES, AMOUNTS, INTEREST RATES, YIELDS AND CUSIP NUMBERS Due August 1 Amount* Interest Rate Price/ Yield CUSIP Number(1) 01179R Due August 1 Amount* Interest Rate Price/ Yield CUSIP Number(1) 01179R 2016 $ 695,000 5.00% 0.35% NH2 2027 $ 1,725,000 4.00% 2.25%*NU3 2017 725,000 5.00% 0.75% NJ8 2028 1,785,000 4.00% 2.35%*NV1 2018 765,000 5.00% 0.98% NK5 2029 1,860,000 2.625%98.00 NW9 2019 1,780,000 5.00% 1.05% NL3 2030 1,905,000 3.00% 2.85%*NX7 2020 1,870,000 5.00% 1.20% NM1 2031 1,780,000 3.00% 100.00 NY5 2021 1,955,000 5.00% 1.37% NN9 2032 1,825,000 3.00% 3.10% NZ2 2022 2,045,000 5.00% 1.50% NP4 2033 1,860,000 3.00% 97.50 PA5 2023 2,065,000 5.00% 1.71% NQ2 2034 470,000 3.125%98.00 PB3 2024 2,165,000 5.00% 1.85% NR0 2035 485,000 3.25% 98.50 PC1 2025 2,285,000 5.00% 2.06% NS8 2036 365,000 3.25% 99.00 PD9 2026 1,695,000 2.00% 99.00 NT6 $910,000 3.50% Term Bond due August 1, 2040; priced at 99.00 CUSIP Number 01179R PE7 * - Priced to first call date of February 1, 2026. (1) CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (“CGS”) is managed on behalf of the American Bankers Association.by S&P Capital IQ. Copyright© 2015 CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data are not intended to create a database and do not serve in any way as a substitute for the CGS database. CUSIP® numbers are provided for the convenience of reference only and are subject to change. The Bond Bank takes no responsibility for the accuracy of such CUSIP numbers. This Official Statement is furnished by the Bond Bank to provide information regarding the sale of the 2016 Series One Bonds referred to herein and may not be reproduced or be used, in whole or in part, for any other purpose. The delivery of this Official Statement does not imply that information herein is correct as of any time subsequent to the date hereof. No dealer, salesman or any other person has been authorized by the Bond Bank to give any information or to make any representation other than as contained in this Official Statement in connection with the offering described herein and, if given or made, such other information or representation must not be relied upon as having been authorized by the foregoing. This Official Statement does not constitute an offer of any securities other than those described on the cover page or an offer to sell or a solicitation of an offer to buy in any jurisdiction in which it is unlawful to make such an offer, solicitation, or sale. The information and expressions of opinion set forth in this Official Statement have been furnished by the Bond Bank and include information from other sources that the Bond Bank believes to be reliable. Neither this Official Statement nor any statement which may have been made orally is to be construed as a contract with the owners of any of the 2016 Series One Bonds. UPON ISSUANCE, THE 2016 SERIES ONE BONDS WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND WILL NOT BE LISTED ON ANY STOCK OR OTHER SECURITIES EXCHANGE. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER FEDERAL, STATE, OR OTHER GOVERNMENTAL ENTITY OR AGENCY, OTHER THAN THE BOND BANK, WILL HAVE PASSED ON THE ACCURACY OR DETERMINED THE ADEQUACY OF THIS OFFICIAL STATEMENT OR APPROVED THE 2016 SERIES ONE BONDS FOR SALE. THE 2005 GENERAL BOND RESOLUTION WILL NOT BE QUALIFIED UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED. The remainder of this page has intentionally been left blank. ALASKA MUNICIPAL BOND BANK 333 Willoughby Avenue, 11th Floor P.O. Box 110405 Juneau, Alaska 99811-0405 (907) 465-2388 http://treasury.dor.alaska.gov/ambba/ Board of Directors Mark Pfeffer - Chair Luke Welles - Vice Chair Gregory Gursey - Member Chris Hladick - Member (Michael Lamb - First Delegate to Chris Hladick) Randall Hoffbeck – Member (Pamela Leary - First Delegate to Randall Hoffbeck) Executive Director Deven J. Mitchell Finance Director Ryan S. Williams Bond Counsel Orrick, Herrington & Sutcliffe LLP Seattle, Washington Trustee The Bank of New York Mellon Trust Company, N.A. San Francisco, California Municipal Advisor Western Financial Group, LLC Portland, Oregon The reference above to the Bond Bank’s website is contact information provided only for convenience. The reference is not a hyperlink and, by this reference, the Bond Bank’s website is not incorporated into this Official Statement. TABLE OF CONTENTS Page Introduction ................................................................................................................................................................. 1 Purpose of the 2016 Series One Bonds ........................................................................................................................ 1 Authorization and Purpose ................................................................................................................................... 1 2016 Series One Bonds ........................................................................................................................................ 1 Sources and Uses Table ............................................................................................................................................... 2 Description of the 2016 Series One Bonds .................................................................................................................. 3 General Description .............................................................................................................................................. 3 2016 Series One Bonds ........................................................................................................................................ 3 Optional Redemption ............................................................................................................................................ 3 Mandatory Redemption ........................................................................................................................................ 3 Notice of Redemption ........................................................................................................................................... 3 Selection of 2016 Series One Bonds for Redemption .......................................................................................... 4 Security and Sources of Payments for the Bonds ........................................................................................................ 4 General ................................................................................................................................................................. 4 Pledge Effected by the 2005 General Bond Resolution........................................................................................ 5 Municipal Bonds .................................................................................................................................................. 5 2005 General Bond Resolution Reserve Fund ...................................................................................................... 5 State Payments ..................................................................................................................................................... 8 Pledge of the State ................................................................................................................................................ 8 The Alaska Municipal Bond Bank............................................................................................................................... 9 Organization ......................................................................................................................................................... 9 Board of Directors ................................................................................................................................................ 9 Management ....................................................................................................................................................... 10 Future Financing Plans ....................................................................................................................................... 10 2015 Legislation ................................................................................................................................................. 11 Debt Payment Record ......................................................................................................................................... 11 Bonds Outstanding .................................................................................................................................................... 12 1976 General Bond Resolution ........................................................................................................................... 12 2005 General Bond Resolution ........................................................................................................................... 12 2010 Municipal Obligation Bond Resolution ..................................................................................................... 12 Revenue Bond Resolutions ................................................................................................................................. 12 Coastal Energy Impact Program ......................................................................................................................... 12 Direct Loans ....................................................................................................................................................... 13 Loans by the State of Alaska .............................................................................................................................. 13 Total Bond Bank Bonds Issued and Outstanding as of January 1, 2016 ................................................................... 14 Remaining Debt Capacity Under Existing Bond Resolutions After the Issuance of the 2016 Series One Bonds ..... 14 Debt Service Requirements of Outstanding 2005 General Bond Resolution General Obligation Bonds and the 2016 Series One Bonds .......................................................................................................................... 15 Summary of the 2005 General Bond Resolution ....................................................................................................... 16 2005 General Bond Resolution Constitutes Contract ......................................................................................... 16 Obligation of the Bond Bank .............................................................................................................................. 16 Pledge ................................................................................................................................................................. 16 Power to Issue Bonds and Make Pledges ........................................................................................................... 16 General ............................................................................................................................................................... 17 Waiver of Laws .................................................................................................................................................. 17 Loan Agreement Provisions ............................................................................................................................... 17 Modification of Loan Agreement Terms ............................................................................................................ 18 Enforcement of Municipal Bonds ....................................................................................................................... 18 Funds and Accounts ........................................................................................................................................... 18 Security for Deposits and Investment of Funds .................................................................................................. 20 Payment of Bonds .............................................................................................................................................. 20 Fees and Charges ................................................................................................................................................ 20 Issuance of Additional Obligations .................................................................................................................... 20 Defeasance.......................................................................................................................................................... 21 Supplements and Amendments .......................................................................................................................... 21 Events of Default and Remedies ........................................................................................................................ 22 Excess Earnings .................................................................................................................................................. 24 Modifications to the 2005 General Bond Resolution ......................................................................................... 24 Litigation ................................................................................................................................................................... 24 Certain Legal Matters ................................................................................................................................................ 24 Verification of Mathematical Computations ............................................................................................................. 25 Underwriting .............................................................................................................................................................. 25 Municipal Advisor ..................................................................................................................................................... 25 Financial Statements .................................................................................................................................................. 25 Tax Matters ................................................................................................................................................................ 25 Ratings ....................................................................................................................................................................... 27 Continuing Disclosure Undertaking .......................................................................................................................... 28 Bond Bank Continuing Disclosure Undertaking ................................................................................................ 28 Governmental Unit Continuing Disclosure Undertakings .................................................................................. 28 Compliance with Prior Continuing Disclosure Undertakings ............................................................................ 28 Sources of Certain Information ................................................................................................................................. 29 Definitions ................................................................................................................................................................. 29 Miscellaneous ............................................................................................................................................................ 31 Official Statement ...................................................................................................................................................... 31 APPENDIX A - Proposed Form of Opinion of Bond Counsel APPENDIX B - State Payments to Governmental Units APPENDIX C - Governmental Unit Statistics Regarding Participation in the Bond Bank APPENDIX D - Summaries of Borrowers Representing 10% or More of Outstanding Principal of Bonds Issued Under the 2005 General Bond Resolution APPENDIX E - Financial Statements of the Alaska Municipal Bond Bank for the Year Ended June 30, 2015 APPENDIX F - 2005 General Obligation Bond Resolution and the 2013 First Supplemental Resolution APPENDIX G - Proposed Form of Continuing Disclosure Certificate APPENDIX H - DTC and Book-Entry System 1 OFFICIAL STATEMENT $33,015,000 ALASKA MUNICIPAL BOND BANK GENERAL OBLIGATION AND REFUNDING BONDS 2016 SERIES ONE INTRODUCTION This Official Statement is furnished by the Alaska Municipal Bond Bank (the “Bond Bank”) to provide information regarding the Bond Bank in connection with the sale of its $33,015,000 principal amount of General Obligation and Refunding Bonds, 2016 Series One (the “2016 Series One Bonds”). The Bond Bank was created pursuant to Alaska Statutes 44.85.005 – 44.85.420, as amended (the “Act”), for the primary purpose of lending money to Governmental Units in the State of Alaska (the “State”) including the purchase of Municipal Bonds issued by such Governmental Units. Certain capitalized terms used in this Official Statement, and not otherwise defined herein, are defined under “DEFINITIONS” or in Appendix F. All references herein to agreements and documents are qualified in their entirety by reference to the definitive forms thereof, and all references to the 2016 Series One Bonds are further qualified by reference to the provisions with respect thereto contained in the 2005 General Obligation Bond Resolution, adopted by the Board of Directors of the Bond Bank on July 13, 2005, as amended (the “2005 General Bond Resolution”), and Series Resolution No. 2015-05 adopted by the Board of Directors of the Bond Bank (the “Board”) on December 15, 2015 (the “Series Resolution,” and together with the 2005 General Bond Resolution, the “Bond Resolution”). All bonds which are issued under and pursuant to the terms of the 2005 General Bond Resolution are hereafter referred to as the “Bonds.” Any statements or information which include matters of opinion or estimates are represented as opinions or estimates in good faith, but no assurance can be given that the facts will materialize as so opined or estimated. On February 19, 2013, the Board adopted a First Supplemental Resolution that amends certain provisions of the 2005 General Bond Resolution effective as of first date on which all Bonds issued prior to February 19, 2013 are no longer Outstanding. Holders and beneficial owners from time to time of the 2016 Series One Bonds are deemed to have consented to all of the amendments authorized in the First Supplemental Resolution. See “Modifications to the 2005 General Bond Resolution” below and the forms of the 2005 General Bond Resolution and the First Supplemental Resolution in Appendix F. Appendix D contains financial, economic and demographic summary information relating to the Governmental Units whose Municipal Bonds represent 10 percent or more of the Loan Obligations outstanding under the 2005 General Bond Resolution. PURPOSE OF THE 2016 SERIES ONE BONDS Authorization and Purpose The 2016 Series One Bonds are being issued pursuant to the terms of the Bond Resolution, and are the thirty-fourth series of Bonds issued under the 2005 General Bond Resolution. 2016 Series One Bonds The 2016 Series One Bond proceeds are being used for the following purposes: (i) to make three loans to Governmental Units for new money purposes; (ii) to refund bonds previously issued by the Bond Bank; and (iii) to purchase a surety policy for deposit to the Reserve Fund and to pay a portion of the costs of issuance of the 2016 Series One Bonds. The 2016 Series One Bond proceeds used for new money purposes include loans to: (i) the City of Klawock to repay a prior loan and to make improvements to the City’s public safety building; (ii) Kodiak Island Borough for school improvements; and (iii) Kenai Peninsula Borough for the purchase of emergency response vehicles. 2 Refunding. A portion of the proceeds of the 2016 Series One Bonds is being used to refund and redeem certain outstanding bonds of the Bond Bank (the “Refunded Bonds”). DETAILS OF THE REFUNDED BONDS Series Designation Principal Amount1 Maturities Redemption Date 2008 Series One $20,530,000 April 1, 2019 to April 1, 2033 April 1, 2018 2008 Series Two 4,840,000 June 1, 2019 to June 1, 2038 June 1, 2018 (1) All Refunded Bonds are subject to redemption at a redemption price of 100% of the principal amount thereof on the proposed redemption date. A portion of the net proceeds from the sale of the 2016 Series One Bonds, together with other legally available funds, will be deposited into a redemption account (the “Redemption Account”) to be held by The Bank of New York Mellon Trust Company, N. A., San Francisco, California (the “Escrow Agent”), under an escrow deposit agreement (the “Escrow Deposit Agreement”), dated the date of delivery of the 2016 Series One Bonds, between the Bond Bank and the Escrow Agent. Funds deposited in the Redemption Account will be used to purchase non-callable direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (the “Escrow Obligations”). The Escrow Obligations will mature at such times and pay interest in such amounts so that, with other available funds held by the Escrow Agent under the Escrow Deposit Agreement, sufficient moneys will be available to pay the interest on the Refunded Bonds coming due on and prior to their respective redemption or purchase dates and to pay the redemption price of the Refunded Bonds on their redemption dates. See “VERIFICATION OF MATHEMATICAL COMPUTATIONS.” SOURCES AND USES TABLE The table below presents the sources and uses of funds related to the 2016 Series One Bonds. Sources of Funds: Principal Amount of 2016 Series One Bonds $33,015,000.00 Net Original Issue Premium 3,488,877.10 City of Seward Prior Reserves 2,469,279.74 City of Seward Contribution 3,500,000.00 City of Klawock Contribution 91,450.00 Alaska Municipal Bond Bank Contribution 41,794.25 Total Sources of Funds $42,606,401.09 Uses of Funds: Deposit to Redemption Account $27,947,950.35 Loan to the City of Klawock 1,431,847.30 City of Klawock Reserve 91,450.00 Loan to Kenai Peninsula Borough 2,756,731.92 Loan to Kodiak Island Borough 8,005,197.33 City of Seward Reserves 1,964,745.57 City of Seward Rounding 5,191.78 Costs of Issuance1 232,830.15 Underwriters’ Discount 170,456.69 Total Uses of Funds $42,606,401.09 (1) Includes Bond Bank costs of issuance (including debt service reserve surety premium) and Governmental Units’ costs of issuance. 3 DESCRIPTION OF THE 2016 SERIES ONE BONDS General Description The 2016 Series One Bonds are issuable only as fully registered bonds, registered in the name of Cede & Co., as nominee for The Depository Trust Company, New York, New York (“DTC”), as securities depository for the 2016 Series One Bonds. Principal of and interest on the 2016 Series One Bonds are payable by The Bank of New York Mellon Trust Company, N.A., of San Francisco, California, as Trustee under the 2005 General Bond Resolution, to DTC which, in turn, is obligated to disburse such principal and interest payments to its participants (the “DTC Participants”) in accordance with DTC procedures. See “Appendix G – DTC and Book-Entry System.” 2016 Series One Bonds The 2016 Series One Bonds mature, subject to prior redemption, on the dates and bear interest at the rates set forth on the inside cover page of this Official Statement. The 2016 Series One Bonds are issuable in denominations of $5,000 or any integral multiple thereof within a single maturity, are dated as of the date of delivery and bear interest from their date payable on February 1 and August 1, commencing August 1, 2016. Optional Redemption The 2016 Series One Bonds maturing on or after August 1, 2026, are subject to redemption in whole or in part at the option of the Bond Bank on any date on or after February 1, 2026, at a price of 100% of the principal amount thereof to be redeemed plus accrued interest to the date fixed for redemption. The Governmental Units’ loans have the same optional redemption provisions associated with the 2016 Series One Bonds. Mandatory Redemption The 2016 Series One Bonds maturing on August 1, 2040, are subject to mandatory sinking fund redemption on August 1 of the years and in the principal amounts set forth in the following table. Any such redemption shall be at a price equal to 100 percent of the principal amount to be redeemed plus accrued and unpaid interest thereon to the date fixed for redemption, but without premium. Date Pricipal Amount August 1, 2037 $380,000 August 1, 2038 395,000 August 1, 2039 65,000 August 1, 2040* 70,000 * Maturity Notice of Redemption The Resolution provides that at least 20 days, but not more than 60 days, prior to the date upon which any 2016 Series One Bonds are to be redeemed, the Trustee will mail a notice of redemption to the registered owner of any 2016 Series One Bond all or a portion of which is to be redeemed, at the owner’s last address appearing on the registration books of the Bond Bank kept by the Trustee. So long as all of the 2016 Series One Bonds are held under the DTC book-entry system, such notice will be sent only to DTC, and any notice to the beneficial owners of the 2016 Series One Bonds will be the responsibility of DTC Participants. Neither the Bond Bank nor the Trustee will provide redemption notices to the beneficial owners. 4 If at the time of mailing any notice of optional redemption, moneys sufficient to redeem the 2016 Series One Bonds to be redeemed are not on deposit with the Trustee, the notice will state that such redemption is subject to the deposit of the redemption moneys and will be of no effect unless such moneys are so deposited. Selection of 2016 Series One Bonds for Redemption If fewer than all of the 2016 Series One Bonds are to be redeemed prior to maturity, the Bond Bank may select the maturity or maturities to be redeemed at the option of the Bond Bank. If, at the time notice of redemption is given the 2016 Series One Bonds are in book-entry form, then DTC will select the 2016 Series One Bonds for redemption within a maturity in accordance with the Letter of Representations. The 2005 General Bond Resolution provides that if less than all of the Bonds of any one maturity of a Series are called for redemption and the Bonds are not in book-entry form, the Bonds to be redeemed are to be selected by lot by the Trustee or in any manner as the Trustee, in its sole discretion, may deem appropriate and fair. See “Appendix G – DTC and Book-Entry System.” SECURITY AND SOURCES OF PAYMENT FOR THE BONDS General The Bonds, including the 2016 Series One Bonds, constitute general obligations of the Bond Bank, and the full faith and credit of the Bond Bank are pledged to the payment of the principal of and interest on the Bonds. The 2016 Series One Bonds do not constitute an indebtedness or other liability of the State of Alaska, and the 2016 Series One Bonds do not directly, indirectly or contingently obligate the State of Alaska to levy any form of taxation or make any appropriation for the payment of the 2016 Series One Bonds. As provided in the Act, the Bond Bank is obligated to pay the principal of and interest on the Bonds only from revenues or funds of the Bond Bank, and the State of Alaska is not obligated to pay the principal of or the interest on the Bonds, including the 2016 Series One Bonds. Neither the faith and credit nor the taxing power of the State of Alaska is pledged for the payment of the 2016 Series One Bonds. The Bond Bank has no taxing power. As of January 1, 2016, the Bond Bank has outstanding $1,095,000 of general obligation bonds issued under its 1976 General Bond Resolution, $995,695,000 of Bonds issued under its 2005 General Bond Resolution and $4,155,000 of general obligation bonds issued under its 2010 Municipal Obligation Bond Resolution. All remaining bonds outstanding under the 1976 General Bond Resolution will be retired as of February 1, 2016. As additional security for payment of principal of and interest on the 2016 Series One Bonds and the other Bonds issued under the 2005 General Bond Resolution, the Bond Bank has established a common Reserve Fund. See “SECURITY AND SOURCES FOR PAYMENT FOR THE BONDS – 2005 General Bond Resolution Reserve Fund.” The Act provides that in order to assure the maintenance of the Reserve Fund Requirement, the Legislature may appropriate annually to the Bond Bank for deposit to the Reserve Fund the amount, if any necessary to restore the Reserve Fund to an amount equal to the Reserve Fund Requirement. The Chair of the Bond Bank is required annually (before each January 30) to make and deliver to the Governor and to the State Legislature a certificate stating the amount, if any, required to restore the Reserve Fund to the amount of the Reserve Fund Requirement. Money received by the Bond Bank from the State pursuant to such certification is required, to the extent such certification was occasioned by the fact that the amount in the Reserve Fund was less than the Reserve Fund Requirement, to be deposited in the Reserve Fund. The State Legislature is legally authorized, but not legally obligated, to appropriate such sums during the then current State fiscal year. This provision of the Act does not create a debt obligation on behalf of the State or a legally enforceable obligation of the State. 5 Beginning in 2009, and continuing through the current fiscal year ending June 30, 2016, the Bond Bank has been obligated by the 2005 General Bond Resolution to seek, and has obtained, a standing appropriation within the State’s annual operating budget to replenish the Reserve Fund, if necessary. The 2005 General Bond Resolution requires the Bond Bank to seek this standing appropriation on an annual basis. No such replenishment from State appropriation has been necessary. If the Bond Bank is required to draw on the Reserve Fund because of a default by a Governmental Unit, the standing appropriation provides that an amount equal to the amount drawn from the Reserve Fund is appropriated from the State’s General Fund to the Reserve Fund. There is no guarantee that the Bond Bank will be able to secure future standing appropriations within the State’s operating budget for replenishment of the Reserve Fund. See “2005 General Bond Resolution Reserve Fund.” Pledge Effected by the 2005 General Bond Resolution Pursuant to the 2005 General Bond Resolution, all Municipal Bonds, all Municipal Bonds Payments, the investments thereof and the proceeds of such investments, if any, and all funds and accounts established by the 2005 General Bond Resolution to be held by the Trustee are pledged and assigned to secure the payment of the principal of, redemption premium, if any, and interest on all Bonds, subject only to the provisions of the 2005 General Bond Resolution permitting the application thereof for the purposes and on the terms and conditions specified in the 2005 General Bond Resolution. The Act and the 2005 General Bond Resolution provide among other things that (i) any pledge made in respect of the Bonds will be valid and binding from the time the pledge is made, (ii) the Municipal Bonds, the Municipal Bonds Payments and all other money and securities so pledged and thereafter received by the Bond Bank immediately will be subject to the lien of such pledge without any further act, and (iii) the lien of any such pledge will be valid and binding against all parties having any claims of any kind in tort, contract or otherwise against the Bond Bank irrespective of whether the parties have notice. Municipal Bonds Under the provisions of the Act and the 2005 General Bond Resolution, the Bond Bank is authorized to purchase Municipal Bonds from any Governmental Unit. The 2005 General Bond Resolution defines Municipal Bonds as “general obligation bonds, revenue bonds, notes or other evidences of debt issued by any Governmental Unit as now or hereafter defined in the Act which have heretofore been or will hereafter be acquired by the Bond Bank as evidence of a Loan to the Governmental Unit pursuant to the Act.” For each issue of Municipal Bonds that the Bond Bank purchases, the Resolution requires the Bond Bank to obtain a bond counsel’s opinion stating that (a) such Municipal Bonds are valid obligations of such Governmental Unit as required by the Act and (b) a Loan Agreement has been duly authorized and executed between the Bond Bank and the Governmental Unit that constitutes a valid and binding obligation of the Governmental Unit. Each Loan Agreement obligates a Governmental Unit to (a) make interest payments on its Municipal Bond sufficient in amount and at such times to provide the Bond Bank funds to meet interest payments on its Loan Obligations as they become due; and (b) make principal payments on its Municipal Bond sufficient in amount and at such times to provide the Bond Bank funds to meet principal payments on its Loan Obligations as they become due. Pursuant to the Loan Agreement, the Governmental Unit may be required to pay fees and charges to the Bond Bank to meet the Governmental Unit’s allocable portion of certain expenses. Each Loan Agreement also contains restrictions on the sale or redemption of the Governmental Unit’s Municipal Bonds. 2005 General Bond Resolution Reserve Fund The 2005 General Bond Resolution established the Reserve Fund to be held by the Trustee and maintained at an amount equal to the Reserve Fund Requirement. The Reserve Fund Requirement is equal to the 6 least of the following: (i) 10% of the initial principal amount of each Series of Bonds then Outstanding; (ii) Maximum Annual Debt Service with respect to all Bonds Outstanding; (iii) 125% of Average Annual Debt Service on all Bonds Outstanding; or (iv) such lower amount as may be required by law. See “DEFINITIONS – Required Debt Service Reserve.” The Reserve Fund has been funded with Bond proceeds, with cash deposits from the Bond Bank and, as of September 2015, with one surety policy. The Reserve Fund Requirement may, however, be satisfied entirely, or in part, by a letter of credit, line of credit, credit facility, surety bond, bond insurance, or any other instrument or arrangement obtained in connection with the issuance of a Series of Bonds. In September 2015, when it issued its 2015 Series Three Bonds, the Bond Bank satisfied the additional reserve requirement by purchasing a surety policy from National Public Finance Guarantee Corporation (“National”) and also intends to satisfy the additional reserve requirement resulting from the issuance of the 2016 One Bonds with a surety provided by National. See “Debt Service Reserve Fund Surety Bond.” As of June 30, 2015, the valuation of assets in the Reserve Fund was approximately $53.6 million, an amount sufficient to satisfy the Reserve Fund Requirement. As of that date, approximately $37 million, representing 69% of the assets in the Reserve Fund was funded from cash deposits by the Bond Bank from available funds, and the balance of $17 million, representing 31% was funded from Bonds issued by the Bond Bank to make deposits to the Reserve Fund (“Reserve Fund Obligations”). As of December 31, 2016, the valuation of assets in the Reserve Fund was approximately $59 million, an amount sufficient to satisfy the Reserve Fund Requirement. As of that date, approximately $37 million, representing 63% of the assets in the Reserve Fund was funded from cash deposits by the Bond Bank from available funds, approximately $17 million, representing 28% was funded from Bonds issued by the Bond Bank to make deposits to the Reserve Fund, and approximately $5 million, representing 9% was funded by a surety policy from National. Investment income from a portion of the amounts in the Reserve Fund is applied to pay principal and interest on the Reserve Fund Obligations. The 2005 General Bond Resolution requires the Bond Bank to submit annually to the State a budget request for an appropriation to replenish the Reserve Fund to the Reserve Fund Requirement in the event that there is a deficiency as a result of a default by a borrower. Since 2009, when the Resolution was amended, and continuing through fiscal year 2016, the State has included in its operating budget a standing appropriation to replenish the Reserve Fund, if necessary, and to appropriate excess earnings in the Operating Account to the Reserve Fund instead of to the State’s General Fund as the Act otherwise would require. Although the Bond Bank is obligated under the Resolution to seek and has obtained such a standing appropriation within the State’s annual operating budget, the State is not obligated, legally or otherwise, to include the appropriation in its annual operating budget. The Bond Bank’s annual obligation to submit to the State a budget request for an appropriation is in addition to the Bond Bank’s obligation to seek an appropriation to restore the Reserve Fund to the amount of the Required Debt Service Reserve as described below. See “— Moral Obligation.” The Resolution provides that on or before December 31 of each year, and subject to the requirements of the 2005 General Bond Resolution, the Trustee will transfer from the Reserve Fund any amounts remaining in the Reserve Fund derived from income or interest earned and profits realized by the Reserve Fund due to investments thereof to the Operating Fund, but only to the extent that there remains after such transfer an amount in the Reserve Fund equal to the Required Debt Service Reserve. See “SUMMARY OF THE 2005 GENERAL BOND RESOLUTION – Funds and Accounts – Reserve Fund” and Section 911 of the 2005 General Bond Resolution in Appendix F. Debt Service Reserve Fund Surety Bond. The Bond Bank has received a commitment from National for a surety bond (the "Debt Service Reserve Fund Surety Bond") to be credited to the Reserve Fund in lieu of a cash deposit. The Debt Service Reserve Fund Surety Bond provides that upon notice from the Trustee to National to the effect that insufficient amounts are on deposit in the Debt Service Fund to pay the principal of (at maturity or pursuant to mandatory redemption requirements) and interest on the Bonds, National will be required to deposit with the Trustee an amount sufficient to pay the principal of and interest on the Bonds or the available amount of the Debt Service Reserve Fund Surety Bond, whichever is less. Upon the later of: (i) three (3) days after receipt by National of a Demand for Payment in the form attached to the Debt Service Reserve Fund Surety Bond, duly 7 executed by the Paying Agent; or (ii) the payment date of the Bonds as specified in the Demand for Payment presented by the Trustee to National, National will be required to make a deposit of funds in an account with U.S. Bank Trust National Association, in New York, New York, or its successor, sufficient for the payment to the Trustee, of amounts which are then due to the Trustee (as specified in the Demand for Payment) subject to the Surety Bond Coverage. The available amount of the Debt Service Reserve Fund Surety Bond is the initial face amount of the Debt Service Reserve Fund Surety Bond less the amount of any previous deposits by National with the Trustee that have not been reimbursed by the Bond Bank. The Bond Bank and National have entered into a Financial Guaranty Agreement in connection with the 2015 Series Three surety policy (the “2015 Agreement”) and intend to enter into a second Agreement dated February 2, 2016 (the "Series 2016 Agreement" and together with the 2015 Agreement, the “Agreements”) when the 2016 Series One Bonds are issued. Pursuant to the Agreements, the Bond Bank is required to reimburse National, with interest, within one year after any deposit, the amount of such deposit made by National with the Trustee under the Debt Service Reserve Fund Surety Bond. The Bond Bank is also required to obtain National’s consent to any amendment or modification of the 2005 General Bond Resolution that would also require consent of Bondholders of the Bonds. The Agreements provide that no optional redemption of 2015 Series Three Bonds or 2016 Series One Bonds may be made until National's Debt Service Reserve Fund Surety Bond is reinstated. The Debt Service Reserve Fund Surety Bond is held by the Trustee in the Debt Service Reserve Fund and is provided as an alternative to the Bond Bank depositing funds equal to the Debt Service Reserve Requirement for outstanding 2016 Series One Bonds. Moral Obligation. The Bond Bank is required to deliver a statement to the Governor and the State Legislature annually, before January 30, stating the amount, if any, necessary to restore the Reserve Fund to the Required Debt Service Reserve resulting from a draw on the Reserve Fund at any time during the prior year. The State Legislature may, but is under no legal obligation to, appropriate money sufficient to restore the Reserve Fund to the Required Debt Service Reserve. The Bond Bank has never reported a deficiency in any of the reserve funds held by the Bond Bank. Custodian Account. Money not held by the Trustee in the Reserve Fund or in reserves for bonds issued under other bond resolutions is maintained by the Bond Bank in an account within the Operating Fund referred to as the Custodian Account (the “Custodian Account”). The Custodian Account contains direct and indirect State appropriations, prior year retained earnings not subject to the statutory annual earnings transfer, and current year investment earnings and as with the Operating Account is not held by the Trustee or pledged to the payment of the Bonds. As of June 30, 2015 the Custodian Account market value balance was $14,586,998. See Notes 2(b) and 2(d) and Note 8 in Appendix E. As of November 30, 2015 the value of the Custodian Account was $13,142,089. The Act requires that earnings on funds directly appropriated by the State to the Bond Bank be transferred to the State in the following fiscal year. Starting in fiscal year 2009, however, and continuing through the current fiscal year 2016, all fiscal year earnings due to the State’s general fund by statute have been appropriated to the Bond Bank’s Custodian Account. The State Legislature may, but is under no legal obligation to, appropriate statutory earnings back to the Bond Bank. The entire Custodian Account balance is available for appropriation by the State Legislature, with a majority vote and the Governor’s concurrence or a three-quarter majority vote to overcome a Governor’s veto of the appropriation, during any Legislative session. The Legislature has not appropriated funds out of the Custodian Account for non-Bond Bank related purposes in the current, or any prior, fiscal year. 8 State Payments The Act provides that any department or agency of the State, after notice from the Bond Bank that a Governmental Unit is in default on the payment of the principal of or interest on its Municipal Bonds then held or owned by the Bond Bank, will withhold the payment of money held by it and payable to such Governmental Unit and pay over such money to the Bond Bank for the purpose of paying principal of and interest on the bonds of the Bond Bank. State payments to Governmental Units include payments through the School Debt Reimbursement Program and Education Support Funding through the Department of Education and Early Development; and community jail funding through the Department of Corrections. A table appears in Appendix B that presents the amount of State payments to communities that have borrowed from the Bond Bank as well as the fiscal year 2016 annual loan payments and associated estimated coverage provided by those State payments. Capital spending, which is the source of matching grant funding to municipalities has been reduced in fiscal year 2015 and further reduced in the fiscal year 2016 budget. This diminished funding is expected to continue to result in a gradual diminishment of the balances in the matching grant column of Appendix B. Other than the constitutionally required education support funding there is no guarantee that State payments will continue, and all of the payments could be reduced from current levels. The payment and amount of such State payments is uncertain, and Legislative authorization for such payments is subject to appropriation and amendment or repeal. See “APPENDIX B – STATE PAYMENTS TO GOVERNMENTAL UNITS.” The Bond Bank has never implemented the State payment intercept remedy. Pledge of the State In the Act, the State has pledged and agreed with the holders of the Bonds that it will not limit or restrict the rights vested in the Bond Bank by the Act to, among other things, purchase, hold and dispose of Municipal Bonds and fulfill the terms of an agreement (including the 2005 General Bond Resolution) made by the Bond Bank with such holders, or in any way impair the rights or remedies of such holders until the Bonds, including interest on the Bonds and interest on unpaid installments of interest and all costs and expenses in connection with an action or proceeding by or on behalf of such holders, are fully met, paid and discharged. The remainder of this page has intentionally been left blank. 9 THE ALASKA MUNICIPAL BOND BANK Organization The powers of the Bond Bank are vested in the Directors. The membership of the Bond Bank consists of five Directors: the Commissioners of the Department of Revenue and the Department of Commerce, Community and Economic Development of the State and three Directors appointed by the Governor. The three appointees serve four-year staggered terms and must be qualified voting residents of the State. The Commissioners of the Department of Revenue and the Department of Commerce, Community and Economic Development may appoint delegates to the Bond Bank Board of Directors to serve in their absence. The Act requires the Directors to elect one of their members as chair and one of their members as vice-chair and also elect a secretary and a treasurer who need not be Directors in the first meeting of each fiscal year. Action may be taken and motions and resolutions adopted by the Bond Bank at any meeting by the affirmative vote of at least three Directors. The Directors appoint an Executive Director to manage the business of the Bond Bank. Board of Directors The Bond Bank’s Board of Directors includes members listed below. Mark Pfeffer - Chair. Term expires July 15, 2017. Mr. Pfeffer was originally appointed to the Board on October 10, 2001. Mr. Pfeffer is a registered architect who owns an architectural practice in Anchorage, Alaska. He is active in the development, design and management of commercial real estate projects, many of which include public/private partnerships. He is President of Pfeffer Development, LLC. Mr. Pfeffer received a Bachelor of Architecture Degree from the University of Nebraska. Gregory Gursey – Vice Chair. Term expires July 15, 2018. Mr. Gursey was appointed to the Board on June 22, 2009. Mr. Gursey became President of Benefit Brokers, Inc. in 2001, after working as Vice President of Investments for Wedbush Morgan Securities for 11 years. Mr. Gursey also serves as a FINRA industry arbitrator in both civil and industry arbitration cases. After graduating from the University of Alaska Anchorage with a degree in finance, Mr. Gursey became involved with the University of Alaska Foundation. He served as the first Chairman of the UAA College of Fellows, served as a Trustee to the UA Foundation, and was a member of the Investment Committee to the UA Foundation. Mr. Gursey has served on both the State of Alaska Dental Examiner’s Board and the U.S. Treasury Department’s Taxpayer Advocacy Panel. He served on the Investment Commission for the Municipality of Anchorage and several other local boards. Luke Welles - Member. Term continues pending reappointment. Mr. Welles was originally appointed to the Board on May 21, 2008. Mr. Welles became Vice President of Finance of the Arctic Slope Native Association, Ltd in March 2011. Prior to his current job he served as Chief Financial Officer of LifeMed Alaska, LLC, which provides medivac services in Alaska. Previously, Mr. Welles was the Chief Financial Officer for the Yukon Kuskokwim Healthcare Corporation which administers healthcare in 52 rural communities including a hospital located in Bethel, Alaska. He has management experience in healthcare, civil construction and commercial real estate. Over the past 15 years he has served on several economic development commissions in the State, as a city council member in Homer, Alaska and on multiple boards. Mr. Welles received a Bachelor of Arts Degree in Foreign Service and International Business from Baylor University. Michael Lamb - Member. Mr. Lamb is the first delegate for Chris Hladick, Commissioner of the Department of Commerce, Community and Economic Development. Mr. Lamb is a certified public accountant with over 25 years’ experience as a chief financial officer and has worked in private, public, and governmental financial management positions. He serves as the chief financial officer for the Alaska Industrial Development and Export Authority and the Alaska Energy Authority. Prior to that, for almost 15 years Mr. Lamb was the chief financial officer for the Fairbanks North Star Borough, Alaska. For almost 9 years, prior to the Borough, he was 10 the chief financial officer for the City of St. Paul, Alaska. Mr. Lamb is a graduate from the University of Washington, School of Business with a Bachelor of Arts in Business Administration, with an emphasis in accounting. Pamela Leary - Member. Ms. Leary is the first delegate for Randall Hoffbeck, Commissioner of the Department of Revenue. She is the Director of Treasury Division in the Department of Revenue and acts as the State Treasurer. She previously served in the Department as State Comptroller from 2007 through 2013. Ms. Leary began her career as an auditor with Price Waterhouse and became a partner in the firm PricewaterhouseCoopers, LLP. After moving to Alaska, Ms. Leary owned and operated a business before reentering the accounting profession with the Alaska Permanent Fund Corporation. She holds a bachelor’s degree in economics from the Wharton School, University of Pennsylvania, and is a certified public accountant in the State of Alaska. Management Deven J. Mitchell, who also serves as State Debt Manager and Investment Officer in the Department of Revenue – Division of Treasury, was appointed Executive Director of the Bond Bank in 1999. Mr. Mitchell has worked for the Department of Revenue since 1992. He previously held several positions in Alaska financial institutions. Mr. Mitchell holds a Bachelor of Science Degree in Business Administration from Northern Arizona University. Ryan S. Williams, who also serves as Operations Research Analyst in the Department of Revenue – Division of Treasury, was appointed Finance Director of the Bond Bank in 2014. Mr. Williams has worked for the Department of Revenue since 2009. Mr. Williams holds a Bachelor of Science Degree in Business Administration from the University of Southern California, with a concentration in International Business. Rather than employ staff, the Bond Bank contracts in the private sector for a wide range of professional services. The Executive Director coordinates the activities of these professionals, which include bond counsel, financial advisor, accountants, auditors, fund trustees, bond trustees and investment managers. Future Financing Plans The Bond Bank anticipates issuing additional bonds pursuant to its 2005 General Bond Resolution or other bond resolutions within the next 12 months to political subdivisions of the State with interceptable state aid. The principal amount of such additional bonds depends on the number and size of the applications for Bond Bank financing from Governmental Units. The total amount of Bond Bank bonds and notes outstanding at any one time may not exceed $1.793 billion, comprised of $1.5 billion to municipalities, Joint Insurance Associations, Port Authorities, Joint Action Agencies, or the University of Alaska; $87.5 million for the University of Alaska; and $205 million for regional health organizations. As of January 1, 2016, the total principal amount of the Bond Bank’s bonds and notes outstanding, not including the 2016 Series One Bonds, was $1,011,255,460 all issued to municipalities. The Bond Bank is currently working with several regional health organizations to determine whether the Bond Bank will participate in the financing of certain health facilities. The Bond Bank anticipates that loans to such regional health organizations will be made with proceeds of bonds issued under separate revenue bond resolutions. Since February 2006, with the exception of the 2010 Series A-1 and A-2 Municipal Obligation Bonds, all of the bonds issued by the Bond Bank have been issued under the 2005 Resolution. The Bond Bank has no plans at this time to issue additional bonds under its 1976 Resolution or its 2010 Resolution. All outstanding bonds issued under the 1976 Resolution will be retired as of February 1, 2016. 11 2015 Legislation In May 2015, the 29th Alaska Legislature passed Senate Bill 46 ("SB 46"), which authorizes the Bond Bank to make loans to Joint Action Agencies, make loans to Regional Health Organizations, and provides technical and conforming amendments to state statutes. The bill adds Joint Action Agencies to the list of political subdivisions of the State that are allowed to utilize the Bond Bank under the primary $1.5 billion borrowing debt limit. The bill also added $205 million of authority for the Bond Bank to lend to Regional Health Organizations in instances where the Commissioner of the State Department of Health and Social Services anticipates a State financial benefit and an increase in the regional quality of health care. Lending to Regional Health Organizations is limited to no more than $205 million at any one time, no more than 49% or any single project where the other 51% of the project’s funding is in place, and no more than $102.5 million for any single project. The Governor signed SB 46 into law on May 26, 2015. The Bond Bank does not anticipate issuing bonds to finance regional health organizations using the 2005 General Bond Resolution. Debt Payment Record The Bond Bank has always made principal and interest payments on its general obligation and revenue bonds when due. No deficiencies have arisen in any Bond Bank debt service fund or reserve fund, nor has there been a need to exercise the provision requiring that State payments to Governmental Units be paid to the Bond Bank. The remainder of this page has intentionally been left blank. 12 BONDS OUTSTANDING Under the provisions of the Act, the Bond Bank can issue additional series of Bonds under its 2005 General Bond Resolution or issue bonds under other resolutions. The Bond Bank currently has bonds outstanding under the following resolutions: 1976 General Bond Resolution As of January 1, 2016, the Bond Bank had issued $721,985,000 of general obligation bonds under the 1976 General Bond Resolution, $1,095,000 of which remains outstanding. All bonds issued under the 1976 General Bond Resolution will be retired as of February 1, 2016. 2005 General Bond Resolution The 2016 Series One Bonds are the thirty-fourth issue of Bonds under the 2005 General Bond Resolution. As of January 1, 2016, the Bond Bank has issued $1,242,550,000 of general obligation bonds under the 2005 General Bond Resolution (not including the principal amount of the 2016 Series One Bonds), $995,695,000 of which remains outstanding. 2010 Municipal Obligation Bond Resolution On November 2, 2010, the Bond Bank’s Board of Directors approved the 2010 Municipal Obligation Bond Resolution (“2010 Resolution”). Bonds issued pursuant to the terms of the 2010 Resolution are general obligation bonds, equally and ratably secured by a pledge and assignment of all obligations acquired by the Bond Bank under the 2010 Resolution. As of January 1, 2016, the Bond Bank has issued $4,765,000 of general obligation bonds under the 2010 Resolution, $4,155,000 of which remains outstanding. Revenue Bond Resolutions The Authority (with respect to the issuance of revenue bonds the Bond Bank is referred to as the Authority) has issued revenue bonds under stand-alone revenue bond resolutions. The proceeds of these revenue bonds are applied toward the purchase of revenue bonds issued by municipal borrowers. There are presently no outstanding revenue bonds issued by the Authority. Coastal Energy Impact Program The Bond Bank issued bonds to provide loans to local governments that qualified for aid under the Coastal Energy Impact Program (“CEIP”). CEIP is a federal program designed to provide financial assistance to coastal states and municipalities facing impacts from offshore oil development. The United States Department of Commerce, National Oceanic and Atmospheric Administration (“NOAA”) and the Bond Bank entered into an agreement whereby the Bond Bank was the direct lending agency for the CEIP in the State, with $50 million available to make loans to local governments or to establish reserves for loans to local governments. The Bond Bank issued CEIP bonds, the proceeds of which were used to purchase bonds issued by the Kenai Peninsula Borough, the City of Seward, the City of Nome and the City of St. Paul. The total amount of CEIP bonds outstanding as of January 1, 2016, under the Coastal Energy Impact Loan Program was $10,310,460, consisting of loans to the City of St. Paul and the City of Nome. The CEIP loans are administered directly by NOAA without involvement of the Bond Bank. Bonds issued for the CEIP are not secured by a pledge of any amounts held by or payable to the Bond Bank under the 2005 13 General Bond Resolution, including the Reserve Fund, nor are they secured directly or indirectly by any reserve account created under the Act. Direct Loans The Bond Bank has purchased certain bond anticipation notes and has defeased certain Bond Bank bonds with money from the Custodian Account while retaining underlying communities’ bonds. As of January 1, 2016, the Bond Bank holds $1,438,485 of City of Galena Utility Revenue Bonds and $156,594 of City of Galena appropriation obligations in its financial portfolio. The loans to the City of Galena are the result of Legislative appropriation to the Bond Bank specifically for this purpose. As of January 1, 2016 the Bond Bank holds $3,200,000 of Kenai Peninsula Borough Bonds, the proceeds of which were used, in part, to construct the Central Peninsula Hospital’s Specialty Clinic Building. That loan was funded with moneys in the Custodian Account and is secured by a pledge of gross hospital revenues and a debt service reserve fund. This loan was made directly as it did not qualify for tax exemption and would have required a special series of taxable Bond Bank bonds combined the relatively short 8-year level debt service structure. The loan is issued on parity with the Central Peninsula Hospital loan that will be funded with proceeds of the 2016 One Bonds. Loans by the State of Alaska The Bond Bank has the statutory authority to borrow funds from the State of Alaska’s general fund at the discretion of the Commissioner or the Department of Revenue. In November 2010 and August 2011 the Bond Bank borrowed $6.0 million and $7.0 million, respectively, from the State for authorized uses of the Bond Bank. The State of Alaska’s fiscal year 2013 capital budget converted the 2010 and 2011 loans to grants through a $13.2 million appropriation to the Bond Bank that was effective April 15, 2012. This amount reflected the original loan amounts plus interest accrued on those loans. The Bond Bank does not have any outstanding loans from the State at this time. The remainder of this page is intentionally left blank. 14 TOTAL BOND BANK BONDS ISSUED AND OUTSTANDING AS OF JANUARY 1, 2016 Original Amount Amount Issued Outstanding I. Total 2005 General Bond Resolution G.O. Bonds(1) $1,275,565,000 (1) $1,003,340,000 (1) II. Total 1976 General Bond Resolution G.O. Bonds 721,985,000 1,095,000 III. Total 2010 Resolution G.O. Bonds 4,765,000 4,155,000 IV. Coastal Energy Impact Loan Program 35,456,046 10,310,460 REMAINING DEBT CAPACITY UNDER EXISTING BOND RESOLUTIONS (3) AFTER THE ISSUANCE OF THE 2016 SERIES ONE BONDS Debt Limit (AS 44.85.180 (c) of the Act) $1,500,000,000 (2) Debt Limit (AS 44.85.180 (e) (1) of the Act) $87,500,000 (2) Less Outstanding Bonds General Obligation Bonds 1976 General Bond Resolution $1,095,000 2010 Resolution 4,155,000 2005 General Bond Resolution 1,003,340,000 (1) $1,008,590,000 (1) Coastal Energy Loan Program 10,310,460 Total Outstanding Debt (AS 44.85.180 (c) and (e) (1)) $1,018,900,460 (1) Remaining Debt Capacity (AS 44.85.180 (c) and (e) (1)) $568,599,540 (1) ______________________________ (1) Includes the 2016 Series One Bonds. (2) The limit applies to all outstanding bonds or notes issued by the Bond Bank under AS 44.85.180(c) and (e)(1). Of this total, $87,500,000 may be issued for the purpose of making loans to the University of Alaska (AS 44.85.180 (e) (1)) and up to $1.5 billion may be issued and outstanding for other purposes of the Bond Bank (AS 44.85.180(c)). The Bond Bank’s 2015 Series Three Bonds included the issuance of $86,085,000 under the University of Alaska authorization (AS 44.85.180(e)(1). (3) In addition, up to $205,000,000 may be issued and outstanding by the Bond Bank for the purpose of making loans to regional health organizations (AS 44.85.180(e)(2)). No debt has been issued under the authorization contained in AS 44.85.180(e)(2), although the Bond Bank has received applications from borrowers under this authorization and expects to issue bonds authorized under AS 44.85.180(e)(2) in 2016. The limits described above do not apply to the authority of the Bond Bank (or a subsidiary corporation of the Bond Bank) to issue bonds to assist governmental employers to prepay all or a portion of their share of the unfunded accrued actuarial liabilities of retirement systems. This authority has never been utilized and the Bond Bank has no plans to do so. 15 DEBT SERVICE REQUIREMENTS OF OUTSTANDING 2005 GENERAL BOND RESOLUTION GENERAL OBLIGATION BONDS AND THE 2016 SERIES ONE BONDS(1) (Fiscal Years Ending June 30) Fiscal Existing 2016 Series One 2016 Series OneTotal Year Debt Service1 Principal Interest Debt Service* 2016 $ 96,495,208 96,495,208 2017 98,109,034 $ 695,000 1,314,801 100,118,836 2018 100,719,037 725,000 1,283,012 102,727,050 2019 96,326,421 765,000 1,245,762 98,337,183 2020 91,140,053 1,780,000 1,182,137 94,102,190 2021 86,979,632 1,870,000 1,090,887 89,940,520 2022 81,990,767 1,955,000 995,262 84,941,029 2023 83,897,727 2,045,000 895,262 86,837,990 2024 77,224,051 2,065,000 792,512 80,081,564 2025 67,427,903 2,165,000 686,762 70,279,665 2026 62,810,065 2,285,000 575,512 65,670,578 2027 58,577,722 1,695,000 501,437 60,774,159 2028 59,389,206 1,725,000 449,987 61,564,193 2029 54,691,127 1,785,000 379,787 56,855,914 2030 46,369,759 1,860,000 319,675 48,549,434 2031 45,386,158 1,905,000 266,687 47,557,845 2032 41,286,095 1,780,000 211,412 43,277,507 2033 40,796,065 1,825,000 157,337 42,778,403 2034 34,527,072 1,860,000 102,062 36,489,134 2035 25,353,079 470,000 66,818 25,889,898 2036 24,217,612 485,000 51,593 24,754,206 2037 19,281,670 365,000 37,781 19,684,452 2038 19,010,722 380,000 25,200 19,415,922 2039 17,783,803 395,000 11,637 18,190,441 2040 15,968,375 65,000 3,587 16,036,963 2041 15,971,275 70,000 1,225 16,042,500 2042 15,898,900 15,898,900 2043 15,897,600 15,897,600 2044 15,904,975 15,904,975 2045 13,319,800 13,319,800 2046 5,429,750 5,429,750 2047 5,428,500 5,428,500 2048 2,155,000 2,155,000 2049 2,152,500 2,152,500 $1,537,916,663 $33,015,000 $12,648,146 $1,583,579,809 * Totals may not foot due to rounding. The 2016 Series One Bonds are the thirty-fourth Series of Bonds issued under the 2005 General Bond Resolution. 1 Reflects defeasance of Refunded Bonds. 16 SUMMARY OF THE 2005 GENERAL BOND RESOLUTION The following is a summary of certain provisions of the 2005 General Bond Resolution. A copy of the 2005 General Bond Resolution, together with the Supplemental Resolution adopted in February 2013, is included in the Official Statement as Appendix F. The 2013 Supplemental Resolution includes amendments to the 2005 General Bond Resolution that take effect after all Bonds outstanding as of February 19, 2013 are no longer outstanding. See “—Modifications to the 2005 General Bond Resolution.” Capitalized terms used in this summary are defined in Section 103 of the 2005 General Bond Resolution. 2005 General Bond Resolution Constitutes Contract The 2005 General Bond Resolution provides that the Resolution constitutes a contract between the Bond Bank, the Trustee and the owners from time to time of the Bonds, that the pledges made in the 2005 General Bond Resolution and the covenants and agreements therein set forth to be performed by the Bond Bank will be for the equal and proportionate benefit, protection and security of the holders of any and all of the Bonds and that each Bond, Credit Enhancement facility and Interest Rate Exchange Agreement will be of equal rank without preference, priority or distinction. Obligation of the Bond Bank The Bonds are general obligations of the Bond Bank, and the full faith and credit of the Bond Bank are pledged for the payment of the principal or redemption premium, if any, of, interest on the Bonds solely from the sources provided in the 2005 General Bond Resolution and any Series Resolution. The Act and the Resolutions each provide that the State is not obligated to pay the principal, premium, if any, or interest on the Bonds, and that the Bonds, are not a debt or liability of the State and neither the faith and credit of the State nor the taxing power of the State is pledged to the payment of the principal of, premium, if any, or interest on the Bonds. Pledge The Municipal Bonds and the Municipal Bonds Payments, the investments thereof and the proceeds of such investments, if any, and all funds and accounts established by the 2005 General Bond Resolution to be held by the Trustee are pledged and assigned for the payment of the principal of, redemption price of, interest on, and sinking fund installments for, the Bonds in accordance with the terms and provisions of the 2005 General Bond Resolution, subject only to the provisions of the 2005 General Bond Resolution permitting the application thereof for the purposes and on the terms and conditions set forth in the 2005 General Bond Resolution. See Section 601 of the 2005 Resolution in Appendix F. The 2005 Resolution provides that Municipal Bonds and the Municipal Bonds Payments and all other money and securities pledged pursuant to the 2005 General Bond Resolution immediately will be subject to the lien of such pledge without any further act, and such lien will be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the Bond Bank, regardless of whether such parties have notice thereof. Power to Issue Bonds and Make Pledges The Bond Bank covenants in the 2005 General Bond Resolution that it is duly authorized by law to issue the Bonds and to pledge the Municipal Bonds Payments, the Municipal Bonds and other money, securities, funds and property purported to be pledged by the 2005 General Bond Resolution, free and clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with, the pledge created by the 2005 General Bond Resolution, except for the liens in favor of the Trustee and Paying Agent as provided in the 2005 General Bond Resolution. The Bond Bank also covenants that it will at all times, to the extent permitted by law, defend, preserve and protect the pledge of the Municipal Bonds Payments, the Municipal Bonds and other money, securities, funds and property pledged under the 2005 General Bond Resolution and all the rights of the Bondholders under the 2005 General Bond Resolution against all claims and demands of all persons whomsoever. 17 General The Bond Bank covenants that it will do and perform or cause to be done and performed all acts and things required to be done or performed by or on behalf of the Bond Bank under law and the 2005 General Bond Resolution in accordance with the terms thereof. The Act provides that the State will not limit or restrict, and the Bond Bank pledges and agrees with the Holders of the Bonds that it will not cause the State to limit or alter, the rights vested by the Act in the Bond Bank to fulfill the terms of any agreements made with Bondholders, or in any way impair the rights and remedies of such Bondholders, until the Bonds, together with the interest thereon, with interest on any unpaid installments of interest, and all costs and expenses in connection with any action or proceeding by or on behalf of such Holders, are fully met and discharged. Waiver of Laws The Bond Bank covenants in addition that it will not at any time insist upon or plead in any manner whatsoever, or claim or take the benefit or advantage of any stay or extension of law now or at any time hereafter in force which may affect the covenants and agreements contained in the 2005 General Bond Resolution or in any Series Resolution or in the Bonds, and all benefit or advantage of any such law or laws is hereby expressly waived by the Bond Bank. Loan Agreement Provisions The 2005 General Bond Resolution provides that no loan will be made by the Bond Bank from proceeds of the sale of Bonds and no Bonds will be issued for the purpose of providing funds with which to make a loan, unless the Loan Agreement under which such loan is to be made will comply with, but not be limited to, the following: (a) The Governmental Unit which is a party to such Loan Agreement must be a Governmental Unit as defined by the 2005 General Bond Resolution, and the Loan Agreement must be executed in accordance with existing laws. (b) The Governmental Unit, prior to or simultaneously with the issuance of Bonds, will issue Municipal Bonds which are valid debt obligations of the Governmental Unit as required by the Act. (c) The Municipal Bonds Payment to be made by the Governmental Unit under such Loan Agreement will be not less than the interest and principal payments the Bond Bank is required to make on the Loan Obligations and will be scheduled by the Bond Bank in such manner and at such times as to provide funds sufficient to pay principal and interest on the Loan Obligations as the same become due. (d) The Governmental Unit will be obligated to pay Fees and Charges to the Bond Bank at the times and in the amounts which will enable the Bond Bank to comply with the provisions of the 2005 General Bond Resolution to pay Administrative Expenses and fees and expenses of the Trustee and paying agent. (e) The Governmental Unit will agree that in the event the Municipal Bonds Payment is not paid by it to the Bond Bank on or before the times specified in the Loan Agreement, any money payable to the Governmental Unit by any department or agency of the 18 State will be withheld from such Governmental Unit and paid over directly to the Trustee acting under the 2005 General Bond Resolution. (f) The Bond Bank will not sell, and the Governmental Unit will not redeem prior to maturity, any of the Municipal Bonds with respect to which the Loan is made in an amount greater than the Outstanding Bonds issued with respect to such Loan which are then redeemable, and any such sale or redemption of such Municipal Bond will be in an amount not less than the aggregate of (i) the principal amount of the Loan Obligation to be redeemed (or the amount of Refunding Bonds if the Loan is being refunded), (ii) the interest to accrue on the Loan Obligation so to be redeemed to the next redemption date, (iii) the applicable redemption premium, and (iv) the costs and expenses of the Bond Bank in effecting the redemption of the Loan Obligation. (g) The Governmental Unit must give the Bond Bank at least fifty (50) days’ notice of its intent to redeem its Municipal Bonds. Modification of Loan Agreement Terms The Bond Bank covenants that it will not consent to the modification of, or modify, the rates of interest of, or the amount or time of payment of any installment of principal of or interest on, any Municipal Bonds evidencing a Loan, or the amount or time of payment of any Fees and Charges payable with respect to such Loan, or the security for or any terms or provisions of such Loan or the Municipal Bonds evidencing the same, in a manner which adversely affects or diminishes the rights of the Bondholders. Enforcement of Municipal Bonds The 2005 General Bond Resolution also provides that the Bond Bank will diligently enforce, and take all reasonable steps, actions and proceedings necessary for the enforcement of, all terms, covenants and conditions of all Loan Agreements and the Municipal Bonds, including the prompt collection, and the giving of notice to the Commissioner of Revenue, Commissioner of Commerce, Community and Economic Development and the Commissioner of Administration and any other department or agency of the State which is custodian of any money payable to the Governmental Unit of any failure or default of the Governmental Unit in the payment of its Municipal Bonds Payments and will promptly transfer any such money, upon receipt thereof, to the Trustee and that the Trustee will deposit any such money in the Principal Account and Interest Account in place of said unpaid Municipal Bonds Payments or in the event deficiencies in said Accounts created by such default will have been made up by the Reserve Fund, into the Reserve Fund to the extent of such deficiencies. Funds and Accounts The 2005 General Bond Resolution established a Debt Service Fund, consisting of an Interest Account, a Principal Account and a Redemption Account; a Reserve Fund; a Rebate Fund, which consists of a separate sub- account for each Series of Bonds; and an Operating Fund. The Debt Service Fund, the Rebate Fund and the Reserve Fund are held by the Trustee. The Operating Fund is held by the Bond Bank and is not pledged to the payment of the Bonds. Debt Service Fund. The Trustee is required to deposit Municipal Bonds Interest Payments and any other money available for the payment of interest in the Interest Account upon receipt thereof and on or before each interest payment date, to pay out of the Interest Account the amounts required for the payment of the interest becoming due on each series of Bonds on such interest payment date. The Trustee is to deposit Municipal Bonds Principal Payments and any other money available for the payment of principal in the Principal Account upon receipt thereof. The Trustee is required, on or before each 19 principal payment date or Sinking Fund Installment date, to pay out of the Principal Account the amounts required for the payment of the principal or Sinking Fund Installment due on each series of Bonds on such date. The Trustee establishes in the Redemption Account a separate sub-account for each Series of Bonds. Any money deposited into the Redemption Account from any source other than excess moneys transferred from the Reserve Fund or certain proceeds received from sales or redemptions of Municipal Bonds pursuant to Section 607 or Section 916 of the 2005 General Bond Resolution will be applied to the purchase or redemption of Bonds. Any money deposited into the Redemption Account from the Reserve Fund because of a reduction in the Required Debt Service Reserve is to be be applied to the purchase or redemption of Reserve Fund Obligations. Reserve Fund. The 2005 General Bond Resolution established the Reserve Fund as a 2005 General Obligation Bond Resolution Reserve Account within the Alaska Municipal Bond Bank Reserve Fund created by the Act and provides that monthly, the Trustee will set aside from amounts in the Reserve Fund derived from investment earnings and profits realized by the Reserve Fund due to investments thereof, an amount which, when added to the amounts theretofore set aside for such purpose and not paid into the Interest Account, will on such date be equal to the unpaid interest on the Reserve Fund Obligations accrued and to accrue to the last day of such month. On or before each principal payment date and Sinking Fund Installment payment date of Reserve Fund Obligations, the Trustee is to withdraw from amounts in the Reserve Fund and deposit in the Principal Account an amount which, when added to the amount then on deposit in the Principal Account and derived from sources other than Municipal Bonds Payments, will be equal to the Principal Installment of the Reserve Fund Obligations falling due on such date. On or before December 31 of each year, after satisfying the deposit requirements set forth above, the Trustee is to withdraw from the Reserve Fund any amount remaining therein derived from investment earnings or profits due to investments thereof, and pay over said amount to the Bond Bank for deposit in the Custodian Account within the Operating Fund, but only to the extent that there remains after such withdrawal an amount in the Reserve Fund at least equal to the Reserve Fund Requirement. The 2005 General Bond Resolution provides that the Bond Bank will pay into the Reserve Fund (a) money made available by the State and paid by the State for the purpose of the Alaska Municipal Bond Bank Reserve Fund created by the Act in the amount provided by a Series Resolution; (b) all money paid to the Bond Bank pursuant to the Act for the purpose of restoring the Reserve Fund to the amount of the Reserve Fund Requirement; (c) such portion of the proceeds of sale of Bonds, if any, as will be provided by any Series Resolution; (d) Credit Enhancement; and (e) any other money which may be made available to the Bond Bank for the purposes of the Reserve Fund from any other source or sources. The Reserve Fund Requirement may be satisfied entirely, or in part, by a letter of credit, a line of credit, a credit facility, a surety bond, or any other instrument or arrangement obtained in connection with the issuance of a Series of Bonds; provided, however, any credit enhancement satisfying all or any part of the Reserve Fund Requirement after the initial issuance of Bonds or issued in substitution of any prior credit enhancement previously issued will not, by itself, cause a withdrawal or downward revision of the ratings maintained by any Rating Agency with respect to the Bonds. In the event there will be a deficiency in the Interest Account or in the Principal Account, the Trustee is to make up such deficiencies from the Reserve Fund. Administration of Reserve Fund. The 2005 General Bond Resolution provides that money and securities held in the Reserve Fund will not be withdrawn therefrom at any time in such amount as would reduce the amount in such Fund to an amount less than the Reserve Fund Requirement except for the payment when due of debt service on Reserve Fund Obligations and to cure a deficiency in the Principal Account or the Interest Account. Rebate Fund. There will be deposited in the Rebate Fund the amount of the Rebate Requirement for each Series of Bonds, and the Trustee will pay over to the United States Government such amounts as determined by the Bond Bank and as set forth in the 2005 General Bond Resolution. All amounts held in the Rebate Fund, 20 including income earned from investment of the Rebate Fund, shall be held by the Trustee free and clear of the lien of the 2005 General Bond Resolution. Operating Fund. The 2005 General Bond Resolution requires the deposit to the Operating Account within the Operating Fund of all Fees and Charges, to the extent not otherwise encumbered or pledged, and any other money which may be made available to the Bond Bank therefor from any other source or sources. Money at any time held for the credit of the Operating Fund is to be used for and applied solely to the following purposes: (a) to pay the Administrative Expenses of the Bond Bank; (b) to pay the fees and expenses of the Trustee and any Paying Agent; (c) to pay financing costs incurred with respect to a Series of Bonds; and (d) to pay any expenses incurred in carrying out any other purpose then authorized by the Act. The Operating Fund is held by the Bond Bank, not by the Trustee, and the 2005 General Bond Resolution provides that all amounts in the Operating Fund will be free and clear of any lien or pledge created by the 2005 General Bond Resolution. Security for Deposits and Investment of Funds The 2005 General Bond Resolution provides that all money held by the Trustee will be continuously and fully secured, for the benefit of the Bond Bank and the Bondholders in such manner as may then be required or permitted by applicable State or federal laws and regulations regarding the security for, or granting a preference in the case of, the deposit of trust funds but does not require the Trustee or any paying agent to give security for the deposit of any money with them held in trust for the payment of the principal or Redemption Price of or interest on any Bonds, or for the Trustee to give security for any money which will be represented by obligations purchased under the provisions of the 2005 General Bond Resolution as an investment of such money. The 2005 General Bond Resolution also provides for the investment of funds held by the Trustee. See the definition of “Investment Securities” and Sections 702 and 703 of the 2005 General Bond Resolution in Appendix F. Payment of Bonds The Bond Bank covenants in the 2005 General Bond Resolution that it will duly and punctually pay or cause to be paid the principal or Redemption Price, if any, of every Bond and the interest thereon, at the dates and places and in the manner provided in the Bonds according to the true intent and meaning thereof, and will duly and punctually satisfy all Sinking Fund Installments, if any, becoming payable with respect to any Series of Bonds. Fees and Charges The Bond Bank may charge such Fees and Charges to each Governmental Unit to which a Loan is made, and will revise such Fees and Charges if necessary, so that such Fees and Charges actually collected from each such Governmental Unit will at all times produce money which, together with such Governmental Unit’s Allocable Proportion of other money available under the provisions of the 2005 General Bond Resolution, and other money available therefor, will be at least sufficient to pay, as the same become due, the Governmental Unit’s Allocable Proportion of the Administrative Expenses of the Bond Bank and of the fees and expenses of the Trustee and any Paying Agent. Issuance of Additional Obligations The Bond Bank may issue additional Bonds and refunding Bonds pursuant to the terms of the 2005 General Bond Resolution; however, no additional series of Bonds are to be issued unless: (a) the aggregate principal amount of Bonds and Notes Outstanding at the time of issuance and delivery of such additional Bonds including the principal amount of such additional Bonds, will not exceed any limit thereon imposed by State law; 21 (b) there is at the time of the issuance of such additional Bonds no deficiency in the amounts required by the 2005 General Bond Resolution or any Series Resolution to be paid into the Debt Service Fund and into the Reserve Fund; (c) the amount of the Reserve Fund, upon the issuance and delivery of such additional Bonds, will not be less than the Required Debt Service Reserve; and (d) the maturities of, or Sinking Fund Installments for, the additional Bonds representing Loan Obligations, unless such additional Bonds are being issued to refund Outstanding Bonds, will be equal to the scheduled Municipal Bonds Principal Payments to be made in respect of the Loans with respect to which such additional Bonds are to be issued. The Bond Bank expressly reserves the right to adopt other general bond resolutions and reserves the right to issue notes and any other obligations so long as the same are not a charge or lien on the Municipal Bonds, the Municipal Bonds Payments and the Fees and Charges or payable from the Debt Service Fund or the Reserve Fund. Defeasance If the Bond Bank will pay or cause to be paid to the holders of all Bonds then Outstanding, the principal and interest and/or Redemption Price, if any, to become due thereon, at the times and in the manner stipulated therein and in the 2005 General Bond Resolution and also will pay or cause to be paid all other sums payable under the 2005 General Bond Resolution, including any amounts payable to the United States, then, at the option of the Bond Bank, as expressed in an instrument in writing signed by an Authorized Officer and delivered to the Trustee, the covenants, agreements and other obligations of the Bond Bank to the Bondholders will be discharged and satisfied. The 2005 General Bond Resolution provides that Bonds may, prior to the maturity or redemption date thereof, be deemed to have been paid if (a) in case any of said Bonds are to be redeemed on any date prior to their maturity, the Bond Bank will have given to the Trustee in form satisfactory to it irrevocable instructions to publish notice of redemption on said date of such Bonds, and (b) there will have been deposited with the Trustee either monies in an amount which will be sufficient or Investment Securities which are not subject to redemption prior to the dates on which amounts will be needed to make payments on the Bonds and described in clause (1) of the definition thereof, the principal of and the interest on which when due will provide money which, together with the money, if any, deposited with the Trustee or Paying Agent at the same time, will be sufficient, to pay, when due, the principal or Redemption Price, if applicable, and interest due and to become due on said Bonds on and prior to the redemption date or maturity date thereof, as may be the case. See the definition of “Outstanding” and Article XIII of the 2005 General Bond Resolution in Appendix F. Supplements and Amendments The Bond Bank may adopt a Series Resolution or Supplemental Resolution without the consent of the Bondholders or the Trustee for various purposes not inconsistent with the 2005 General Bond Resolution, to provide for the issuance of additional Series of Bonds, to impose additional limitations or restrictions on the issuance of Bonds, to impose other restrictions on the Bond Bank, to surrender any right, power or privilege, or to confirm any pledge of or lien upon the Municipal Bonds or the Municipal Bonds Payments or any other funds. The Bond Bank may also supplement the 2005 General Bond Resolution to cure any ambiguity or defect in the 2005 General Bond Resolution, provided such modifications are not contrary to or inconsistent with the 2005 General Bond Resolution as theretofore in effect. Any other modification or amendment of the 2005 General Bond Resolution and of the rights and obligations of the Bond Bank and of the Bondholders may be made with the written consent (a) of the holders of at least two-thirds in principal amount of the Bonds Outstanding at the time such consent is given, or (b) in case 22 less than all of the several Series of Bonds then Outstanding are affected by the modification or amendment, of the holders of at least two-thirds in principal amount of the Bonds of each Series so affected and Outstanding at the time such consent is given; provided, however, that such modification or amendment will not permit (i) a change in the terms of redemption or maturity of the principal of any outstanding Bond or of any installment of interest thereon or Sinking Fund Installment therefor, (ii) a reduction in the principal amount or the Redemption Price thereof or in the rate of interest thereon, (iii) a reduction of the percentage of the Holders of which is required to effect any such modification or amendment, or (iv) the creation of any lien prior to or on a parity with the lien created by the 2005 General Bond Resolution (except in the manner provided by the 2005 General Bond Resolution) or deprive the Bondholders of the lien created by the 2005 General Bond Resolution, without the consent of the holders of all the Bonds Outstanding or of the Series of Bonds affected by such modification or amendment. To the extent that the full payment of the interest and principal of Bonds of a Series is secured by Credit Enhancement, the Credit Enhancement Agency will be considered to be the Bondholder of all the Bonds of the Series for purposes of exercising any rights with respect to supplements and amendments to the 2005 General Bond Resolution if the Credit Enhancement so provides. See Articles X and XI and the definition of “Bondholder” in the 2005 General Bond Resolution and Section 202 of the Supplemental Resolution in Appendix F. Events of Default and Remedies Each of the following events is an Event of Default under the 2005 General Bond Resolution: (a) the Bond Bank defaults in the payment of the principal or Redemption Price of, Sinking Fund Installment for, or interest on, any Bond when and as the same will become due whether at maturity or upon call for redemption, or otherwise; (b) the Bond Bank fails or refuses to comply with the provisions of the Act regarding the certification of deficiencies in the 2005 General Bond Resolution Reserve Fund, or such amounts as will be certified to the Governor and to the Legislature pursuant to the Act are not appropriated and paid to the Bond Bank prior to the termination of the then current State fiscal year; or (c) the Bond Bank fails or refuses to comply with the provisions of the Act, other than as described in (b) above, or defaults in the performance or observance of any other of the covenants, agreements or conditions on its part in the 2005 General Bond Resolution, any Series Resolution, any Supplemental Resolution, or in the Bonds contained, and such failure, refusal or default will continue for a period of 45 days after written notice thereof by the Trustee or the Holders of not less than 25 percent in principal amount of the Outstanding Bonds; provided, however, that an event of default will not be deemed to exist under the provisions described in clause (c) above upon the failure of the Bond Bank to make and collect Fees and Charges required to be made and collected by the 2005 General Bond Resolution or upon the failure of the Bond Bank to enforce any obligation undertaken by a Governmental Unit pursuant to a Loan Agreement including the making of the stipulated Municipal Bonds Payments so long as the Bond Bank may be otherwise directed by law and so long as the Bond Bank will be provided with money from the State or otherwise, other than withdrawals from or reimbursements of the Reserve Fund, sufficient in amount to pay the principal of and interest on all Bonds as the same will become due during the period for which the Bond Bank will be directed by law to abstain from making and collecting such Fees and Charges and from enforcing the obligations of a Governmental Unit under the applicable Loan Agreement. The 2005 General Bond Resolution provides that upon the happening and continuance of any event of default described in paragraph (a) above, the Trustee will proceed, or upon the happening and continuance of any event of default described in paragraphs (b) and (c) above, the Trustee may proceed, and upon the written request of the holders of not less than 25 percent in principal amount of the Outstanding Bonds will proceed, in its own 23 name, to protect and enforce its rights and the rights of the Bondholders by such of the following remedies as the Trustee, being advised by counsel, will deem most effectual to protect and enforce such rights: (a) by mandamus or other suit, action or proceeding at law or in equity, enforce all rights of the Bondholders, including the right to require the Bond Bank to make and collect Fees and Charges and Municipal Bonds Payments adequate to carry out the covenants and agreements as to, and pledge of, such Fees and Charges and Municipal Bonds Payments, and other properties and to require the Bond Bank to carry out any other covenant or agreement with Bondholders and to perform its duties under the Act; (b) by bringing suit upon the Bonds; (c) by action or suit in equity, require the Bond Bank to account as if it were the trustee of an express trust for the holders of the Bonds; (d) by action or suit in equity, enjoin any acts or things which may be unlawful or in violation of the rights of the holders of the Bonds. Acceleration. The 2005 General Bond Resolution provides that upon the occurrence of an event of default in the payment of principal of and interest on Bonds then Outstanding, the Trustee may, and upon the written request of the holders of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding will, declare the principal of all the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same will be immediately due and payable. This provision, however, is subject to the condition that if before any judgment or decree for the payment of the money due will have been obtained or entered, the Bond Bank deposits with the Trustee a sum sufficient to pay all principal on the Bonds matured prior to such declaration and all matured installments of interest upon all the Bonds, with interest on such overdue installments of principal at the rate borne by the respective Bonds, and the reasonable expenses of the Trustee, and any and all other defaults known to the Trustee will have been made good or cured to the satisfaction of the Trustee or provision deemed by the Trustee to be adequate will have been made therefor, then the holders of at least a majority in aggregate principal amount of the Bonds then outstanding, may, on behalf of the holders of all of the Bonds, rescind and annul such declaration and its consequences and waive such default. See Sections 1203 and 1204 in Appendix F. Bondholders’ Direction of Proceedings. The holders of a majority in principal amount of the Bonds then Outstanding will have the right to direct the method of conducting all remedial proceedings to be taken by the Trustee, provided that such direction will not be otherwise than in accordance with law or the 2005 General Bond Resolution, and that the Trustee will have the right to decline to follow any such direction which in the opinion of the Trustee would be unjustly prejudicial to Bondholders not parties to such direction. Limitation on Rights of Bondholders. No holder of any Bond will have any right to institute any suit, action, mandamus or other proceeding in equity or at law under the 2005 General Bond Resolution, or for the protection or enforcement of any right under the 2005 General Bond Resolution or any right under law unless such holder will have given to the Trustee written notice of the event of default or breach of duty on account of which such suit, action or proceeding is to be taken, and unless the holders of not less than 25 percent in principal amount of the Bonds then Outstanding will have made written request of the Trustee and will have afforded the Trustee a reasonable opportunity either to proceed to exercise the powers granted under law or to institute such action, suit or proceeding in its name and unless, also, there will have been offered to the Trustee reasonable security and indemnity against the costs, expenses and liabilities to be incurred thereby, and the Trustee will have refused or neglected to comply with such request within a reasonable time. No holder of the Bonds will have any right to affect, disturb or prejudice the security of the 2005 General Bond Resolution, or to enforce any right with respect to the Bonds or the 2005 General Bond Resolution, except in the manner provided in the 2005 General Bond Resolution, and all proceedings at law or in equity will be instituted, held and maintained in the manner herein provided and for the benefit of all Bondholders. 24 Excess Earnings The Bond Bank covenants and agrees to calculate Rebatable Arbitrage and to pay Rebatable Arbitrage to the United States of America in the manner necessary to comply with the then applicable federal tax law. Within 30 days after the end of every fifth Bond Year, and within 60 days of the date when all of each Series of Bonds have been retired (or at such other time or times as may then be required by the Code and the applicable Income Tax Regulations), the Bond Bank will determine the Rebatable Arbitrage with respect to each Series of Bonds, and pay rebate amounts due the United States of America with respect thereto, as provided in Section 148(f) of the Code. Modifications to the 2005 General Bond Resolution In addition to modifications with and without consent of Bondholders, the 2005 General Bond Resolution authorizes modifications of any provision set forth in the 2005 General Bond Resolution by the terms of a Supplemental Resolution, with such modifications becoming effective after all Bonds of each Series Outstanding as of the date of such Supplemental Resolution authorizing such modification cease to be Outstanding. A first supplemental resolution (the "First Supplemental Resolution") was approved by the Board of Directors of the Bond Bank at a meeting held on February 19, 2013. The First Supplemental Resolution authorizes the following modifications to the 2005 General Bond Resolution: (i) to authorize the Trustee to release to the Bond Bank amounts held in the Reserve Fund which exceed the Required Debt Service Reserve whenever there is a reduction in the Required Debt Service Reserve, (ii) to authorize the Trustee to release to the Bond Bank earnings and profits realized from investments in the Reserve Fund on or before June 30 of each year so long as the balance therein equals the Required Debt Service Reserve, (iii) to allow for certain amendments and modifications to the 2005 General Bond Resolution to be effective upon securing the consent of Holders of at least two-thirds in principal amount of Bonds then Outstanding, and (iv) to establish that consent of Holders of Bonds, when required under the terms of the 2005 General Bond Resolution, specifically includes the consent of an underwriter or purchaser of a Series of Bonds at the time such Bonds are issued. The modifications to the 2005 General Bond Resolution set forth in the First Supplemental Resolution shall become effective after all Bonds issued prior to the 2013 Series One Bonds cease to be Outstanding and compliance by the Bank with certain requirements set forth in the 2005 General Bond Resolution, at which time these modifications will apply to the 2016 Series One Bonds and govern the rights and obligations of the Holders thereof. LITIGATION Upon the delivery of the 2016 Series One Bonds, the Bond Bank will furnish a certificate to the effect that, among other things, there is no litigation pending in any court to restrain or enjoin the issuance or delivery of the 2016 Series One Bonds, or in any way contesting the validity or enforceability of the 2016 Series One Bonds, the 2005 General Bond Resolution or any Bonds or money pledged under the 2005 General Bond Resolution. CERTAIN LEGAL MATTERS Legal matters incident to the authorization, issuance and sale by the Bond Bank of the 2016 Series One Bonds are subject to the approving legal opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Bond Bank. The proposed form of the opinion of Bond Counsel is included herein as Appendix A. Certain legal matters will be passed upon for (i) the City of Klawock by its bond counsel, K&L Gates LLP of Seattle, Washington, (ii) Kenai Peninsula Borough and Kodiak Island Borough by their co-bond counsel, Foster Pepper PLLC of Seattle, Washington and the Levesque Law Group, LLC of Anchorage, Alaska, and (iii) the City of Seward by its counsel, Jermaine, Dunnagan & Owens, P.C, Anchorage, Alaska. 25 VERIFICATION OF MATHEMATICAL COMPUTATIONS Causey Demgen & Moore P.C., independent certified public accountants, will verify the mathematical accuracy of certain computations provided by the Financial Advisor regarding (a) the adequacy of the maturing principal amounts of and interest on the Escrow Obligations, together with an initial cash deposit, to pay the redemption price of and interest on the Refunded Bonds and (b) the actuarial yields on the 2016 Series One Bonds and the Escrow Obligations. Such verifications are being relied upon by the Bond Bank’s Bond Counsel, among other things, to support its conclusion that the 2016 Series One Bonds are not “arbitrage bonds” under Section 148 of the Internal Revenue Code of 1986. UNDERWRITING The Bond Bank offered the 2016 Series One Bonds at public sale on January 20, 2016. The Bond Bank awarded the contract for the sale of the 2016 Series One Bonds to Morgan Stanley & Co., LLC at a purchase price of $36,333,420.41 (reflecting the aggregate principal amount of the 2016 Series One Bonds, plus a net original issue premium of $3,488,877.10 less an underwriter’s discount of $170,456.69). The Underwriter has represented to the Bond Bank that the 2016 Series One Bonds have been subsequently reoffered to the public initially at the yield or price set forth in the inside cover of the Official Statement. The initial offering prices (or prices corresponding to the yields) set forth on the inside cover of this Official Statement may be changed from time to time by the Underwriter without prior notice to any person after the date of the sale of the 2016 Series One Bonds. The Underwriter may offer and sell the 2016 Series One Bonds to certain dealers, unit investment trusts or money market funds at prices lower than the initial offering prices (or prices corresponding to the yields) set forth on the inside cover of this Official Statement. Morgan Stanley, parent company of Morgan Stanley & Co. LLC., underwriter of the Bonds, has entered into a retail distribution arrangement with Morgan Stanley Smith Barney LLC. As part of the distribution arrangement, Morgan Stanley & Co. LLC may distribute municipal securities to retail investors through the financial advisor network of Morgan Stanley Smith Barney LLC. As part of this arrangement, Morgan Stanley & Co. LLC may compensate Morgan Stanley Smith Barney LLC for its selling efforts with respect to the Bonds. MUNICIPAL ADVISOR Western Financial Group, LLC has acted as financial advisor (the “Municipal Advisor”) to the Bond Bank in connection with the issuance of the 2016 Series One Bonds. The Municipal Advisor is not obligated to undertake, and has not undertaken to make, an independent verification or to assume responsibility for the accuracy, completeness, or fairness of the information contained in this Official Statement. Western Financial Group, LLC is an independent advisory firm registered with the Securities and Exchange Commission and is not engaged in the business of underwriting, trading, or distributing municipal securities or other public securities. FINANCIAL STATEMENTS The financial statements of the Bond Bank included as Appendix E to this Official Statement have been audited by BDO USA, LLP, independent certified public accounts, to the extent and for the periods indicated in their report thereon. Such financial statements have been included in reliance upon the report of BDO USA, LLP. The Bond Bank has not requested BDO USA, LLP to provide written consent for inclusion of the financial statements in this Official Statement. TAX MATTERS 2016 Series One Bonds. In the opinion of Orrick, Herrington & Sutcliffe LLP (“Bond Counsel”), based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the 26 accuracy of certain representations and compliance with certain covenants, interest on the 2016 Series One Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Code. Bond Counsel is of the further opinion that interest on the 2016 Series One Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. . Bond Counsel is also of the opinion, based on existing laws of the State that interest on the 2016 Series One Bonds is exempt from taxation by the State except for transfer, estate and inheritance taxes. To the extent the issue price of any maturity of the 2016 Series One Bonds is less than the amount to be paid at maturity of such 2016 Series One Bonds (excluding amounts stated to be interest and payable at least annually over the term of such 2016 Series One Bonds), the difference constitutes “original issue discount,” the accrual of which, to the extent properly allocable to each Beneficial Owner thereof, is treated as interest on the 2016 Series One Bonds which is excluded from gross income for federal income tax purposes. For this purpose, the issue price of a particular maturity of the 2016 Series One Bonds is the first price at which a substantial amount of such maturity of the 2016 Series One Bonds is sold to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the 2016 Series One Bonds accrues daily over the term to maturity of such 2016 Series One Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates). The accruing original issue discount is added to the adjusted basis of such 2016 Series One Bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such 2016 Series One Bonds. Beneficial Owners of the 2016 Series One Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 2016 Series One Bonds with original issue discount, including the treatment of Beneficial Owners who do not purchase such Bonds in the original offering to the public at the first price at which a substantial amount of such 2016 Series One Bonds is sold to the public. 2016 Series One Bonds purchased, whether at original issuance or otherwise, for an amount higher than their principal amount payable at maturity (or, in some cases, at their earlier call date) (“Premium Bonds”) will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of bonds, like the Premium Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, the amount of tax-exempt interest received, and a Beneficial Owner’s basis in a Premium Bond, will be reduced by the amount of amortizable bond premium properly allocable to such Beneficial Owner. Beneficial Owners of Premium Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances. The Code imposes various restrictions, conditions and requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the 2016 Series One Bonds. The Bond Bank and each Governmental Unit havemade certain representations and covenanted to comply with certain restrictions, conditions and requirements designed to ensure that interest on the 2016 Series One Bonds will not be included in federal gross income. Inaccuracy of these representations or failure to comply with these covenants may result in interest on the 2016 Series One Bonds being included in gross income for federal income tax purposes, possibly from the date of original issuance of the 2016 Series One Bonds. The opinion of Bond Counsel assumes the accuracy of these representations and compliance with these covenants. Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken), or events occurring (or not occurring), or any other matters coming to Bond Counsel’s attention after the date of issuance of the 2016 Series One Bonds may adversely affect the value of, or the tax status of interest on, the 2016 Series One Bonds. Accordingly, the opinion of Bond Counsel is not intended to, and may not, be relied upon in connection with any such actions, events or matters. Although Bond Counsel is of the opinion that interest on the 2016 Series One Bonds is excluded from gross income for federal income tax purposes, the ownership or disposition of, or the accrual or receipt of amounts treated as interest on, the 2016 Series One Bonds may otherwise affect a Beneficial Owner’s federal, 27 state or local tax liability. The nature and extent of these other tax consequences depends upon the particular tax status of the Beneficial Owner or the Beneficial Owner’s other items of income or deduction. Bond Counsel expresses no opinion regarding any such other tax consequences. Current and future legislative proposals, if enacted into law, clarification of the Code or court decisions may cause interest on the Bonds to be subject, directly or indirectly, in whole or in part, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Beneficial Owners from realizing the full current benefit of the tax status of such interest. For example, the Obama Administration’s budget proposals in recent years have proposed legislation that would limit the exclusion from gross income of interest on the 2016 Series One Bonds to some extent for high-income individuals. The introduction or enactment of any such legislative proposals or clarification of the Code or court decisions may also affect, perhaps significantly, the market price for, or marketability of, the 2016 Series One Bonds. Prospective purchasers of the 2016 Series One Bonds should consult their own tax advisors regarding the potential impact of any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel is expected to express no opinion. The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsel’s judgment as to the proper treatment of the Bonds for federal income tax purposes. It is not binding on the Internal Revenue Service (“IRS”) or the courts. Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the Bond Bank or the Governmental Units or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The Bond Bank and the Governmental Units have covenanted, however, to comply with the requirements of the Code. Bond Counsel’s engagement with respect to the 2016 Series One Bonds ends with the issuance of the 2016 Series One Bonds, and, unless separately engaged, Bond Counsel is not obligated to defend the Bond Bank, the Governmental Units or the Beneficial Owners regarding the tax-exempt status of interest on the 2016 Series One Bonds in the event of an audit examination by the IRS. Under current procedures, parties other than the Bond Bank, the Governmental Units and their appointed counsel, including the Beneficial Owners, would have little, if any, right to participate in the audit examination process. Moreover, because achieving judicial review in connection with an audit examination of tax-exempt bonds is difficult, obtaining an independent review of IRS positions with which the Bond Bank or the Governmental Units legitimately disagree, may not be practicable. Any action of the IRS, including but not limited to selection of the 2016 Series One Bonds for audit, or the course or result of such audit, or an audit of bonds presenting similar tax issues may affect the market price for, or the marketability of, the 2016 Series One Bonds, and may cause the Bond Bank, the Governmental Units or the Beneficial Owners to incur significant expense. RATINGS Fitch Ratings (“Fitch”) and Standard & Poor’s Ratings Services (“S&P”) have assigned “AA+” and “AA (negative outlook)” ratings, respectively, to the 2016 Series One Bonds. Such ratings reflect only the views of such organizations and any desired explanation of the significance of such ratings should be obtained from the rating agency furnishing the same, at the following addresses: Fitch, One State Street Plaza, New York, New York 10004, (212) 908-0500; S&P, 55 Water Street, New York, New York 10041 (212) 438-1000. 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 ratings will continue for any given period of time or that such ratings will not be revised downward or withdrawn entirely by the rating agencies if, in the judgment of such rating agencies, circumstances so warrant. Any such downward revision or withdrawal of such ratings may have an adverse effect on the market price of the 2016 Series One Bonds. 28 CONTINUING DISCLOSURE UNDERTAKING Bond Bank Continuing Disclosure Undertaking The Bond Bank has covenanted for the benefit of the holders and beneficial owners of the 2016 Series One Bonds to provide, or to cause to be provided, certain financial and operating information not later than 210 days after the end of each Fiscal Year (currently June 30) in which any 2016 Series Bonds Bonds are outstanding, commencing in the Fiscal Year ending June 30, 2016 (each an “Annual Report”). In addition, the Bond Bank has covenanted to provide notices of the occurrence of certain enumerated events. The Annual Reports are required to be filed by the Bond Bank with the MSRB through its EMMA system. The specific nature of information to be contained in the Annual Report and the enumerated events of which the Bond Bank is to give notice are set forth in the form of the Continuing Disclosure Certificate included in this Official Statement as Appendix G. These covenants have been made in order to assist the Underwriter in complying with SEC Rule 15c2-12(b)(5) (the “Rule”). Governmental Unit Continuing Disclosure Undertakings Each of the Governmental Units from which the Bond Bank is purchasing Municipal Bonds with proceeds of the 2016 Series One Bonds (the “2016 Series One Governmental Units”) has covenanted, or will covenant, to file with the MSRB, on an annual basis, its audited financial statements no later than 210 days after the end of such Governmental Unit’s fiscal year for the term of the Municipal Bonds and any refunding Municipal Bonds. In addition, the 2016 Series One Governmental Units have covenanted, or will covenant, that if its bonds constitute 10 percent (10%) or more of the outstanding principal amount of the Municipal Bonds held by the Bond Bank under the 2005 General Bond Resolution, such 2016 Series One Governmental Unit will execute a continuing disclosure agreement prepared by the Bond Bank for purposes of complying with the Rule. Beginning in 2009, the Governmental Units from whom the Bond Bank purchased Municipal Bonds were required to covenant to execute a continuing disclosure certificate if such Governmental Unit’s bonds constituted 10 percent (10%) or more of the outstanding principal amount of the Municipal Bonds held by the Bond Bank under the 2005 General Bond Resolution. Effective as of October 30, 2014, Governmental Units from which the Bond Bank purchased Municipal Bonds or refunding Municipal Bonds are required to covenant to file with the MSRB, on an annual basis, its audited financial statements no later than 210 days after the end of such Governmental Unit’s fiscal year for the term of the Municipal Bond and any refunding Municipal Bond, as well as to execute a continuing disclosure agreement if its bonds constitute 10 percent (10%) or more of the outstanding principal amount of the Municipal Bonds held by the Bond Bank under the 2005 General Bond Resolution. In addition, the Governmental Units each have covenanted that if its Municipal Bonds constitute 10 percent (10%) or more of the outstanding principal amount of the Municipal Bonds held by the Bond Bank under the 2005 General Bond Resolution, such Governmental Units will provide to the Bond Bank for inclusion in future official statements financial information generally of the type included in the Bond Bank’s official statements with respect to Governmental Units representing ten percent (10%) or more of the Bonds outstanding under the 2005 General Bond Resolution. See Appendix D. Compliance with Prior Continuing Disclosure Undertakings Bond Bank Bonds Issued Under the 2005 General Obligation Bond Resolution. The Bond Bank previously has entered into continuing disclosure undertakings under the Rule in connection with its outstanding Bonds. The Bond Bank subsequently discovered it had not filed certain event notices in connection with rating downgrades of insurers and underlying ratings upgrades. Event notices were subsequently filed. In addition, the Bond Bank discovered it had not included in its annual report statistics of Governmental Units similar to those found in Appendix C of its official statements, as required by prior continuing disclosure 29 undertakings. Such information was included in publicly available official statements prepared by the Bond Bank every year of noncompliance for Bonds issued under the 2005 General Bond Resolution. Such information was, however, dated on or about the date of the official statement rather than as of the end of the Bond Bank's fiscal year end. This technical deficiency was cured and such information was filed with the MSRB. Other Bonds Issued by the Bond Bank. The Bond Bank previously entered into continuing disclosure undertakings for bonds issued under its 1976 General Bond Resolution and 2010 Resolution. The Bond Bank discovered that certain annual financial information relating to governmental units participating in the 1976 General Bond Resolution pool and the 2010 Resolution pool had not been filed. This technical deficiency was cured and such information was filed with the MSRB. As of February 1, 2016, no bonds will remain outstanding under the 1976 General Bond Resolution. The Bond Bank previously entered into continuing disclosure undertakings in connection with certain revenue bonds issued by the Bond Bank. The Bond Bank discovered certain annual financial information relating to governmental units was not filed under the terms of such undertakings. These revenue bonds no longer remain outstanding. General. The Bond Bank has developed procedures to help ensure its continuing disclosure obligations are complied with in all material respects. Although there have been instances of technical deficiencies with its previous undertakings, the Bond Bank believes it has complied in the past five years in all material respects with its previous undertakings with regard to the Rule. Governmental Units. In 2014, it was discovered that certain of the Governmental Units that timely filed annual financial information in accordance with their prior undertakings inadvertently failed to associate that annual financial information with all Bonds issued and Outstanding under the 2005 General Bond Resolution. Effective February 20, 2014, each undertaking and/or Loan Agreement executed by Governmental Units includes an express requirement that such filing be linked to the CUSIP numbers for all Outstanding Bonds issued under the 2005 General Bond Resolution. SOURCES OF CERTAIN INFORMATION As of the date of this Official Statement, the Governmental Units which have loan obligations in an amount of ten percent (10%) or greater in the pool of loans financed with proceeds of Bonds are the City and Borough of Sitka (14.59%), the City and Borough of Juneau (12.90%), the Kenai Peninsula Borough (11.17%), and the City of Ketchikan (10.31%). These Governmental Units have provided the information appearing in Appendix D of this Official Statement. The Bond Bank makes no representation as to the accuracy of the information concerning the City and Borough of Juneau, the Kenai Peninsula Borough, the City and Borough of Sitka, or the City of Ketchikan found in Appendix D of this Official Statement. DEFINITIONS The following terms are used in this Official Statement with the following meanings: See also the definitions in Article I of the 2005 General Bond Resolution in Appendix F. "Act" — The Alaska Municipal Bond Bank Act, codified as Chapter 85, Title 44, of the Alaska Statutes, as amended. "Bond Bank" — The Alaska Municipal Bond Bank, a public corporation and instrumentality of the State of Alaska within the Department of Revenue but with legal existence independent of and separate from the State. "Bonds" — Bonds issued by the Bond Bank under the 2005 General Bond Resolution pursuant to a Series Resolution. These include "Loan Obligations" and "Reserve Fund Obligations" as defined below. 30 "Code" — Internal Revenue Code of 1986 and the regulations thereunder, as amended. "Credit Enhancement" — A letter of credit, a line of credit, a credit facility, a surety bond, bond insurance, or any other instrument or arrangement obtained in connection with the issuance of a Series of Bonds to further secure the payment of the Bonds of such Series or to satisfy the Reserve Fund Requirement. "Credit Enhancement Agency" — Any bank or other institution that provides Credit Enhancement. "Debt Service Fund" — A fund established by the 2005 General Bond Resolution to be maintained and held by the Trustee. The 2005 General Bond Resolution defines and provides that the "Interest Account," "Principal Account" and "Redemption Account" are maintained within the Debt Service Fund. "Fees and Charges" — All fees and charges authorized to be charged by the Bond Bank pursuant to Sections 44.85.080 (8), (15), and (16) of the Act and charged by the Bank pursuant to the terms and provisions of the Loan Agreements. "Governmental Unit" — A municipality or such other entity from which the Bond Bank is authorized by law to purchase its revenue bonds, general obligation bonds, notes, or other forms of indebtedness and which otherwise satisfies conditions found in the 2005 General Bond Resolution and in the Loan Agreement. "Loan Agreement" — An agreement, and any amendments thereto, entered into between the Bond Bank and a Governmental Unit setting forth the terms and conditions of a loan. "Loan Obligations" — The amount of Bonds and the Bonds themselves issued by the Bond Bank for the purchase of Municipal Bonds of a Governmental Unit. "Municipal Bonds" — General obligation bonds, revenue bonds, notes or other evidence of debt issued by any Governmental Unit, as defined in the Act, which have been acquired by the Bond Bank as evidence of a loan to the Governmental Unit pursuant to the Act. "Municipal Bonds Payment" — The amounts paid or required to be paid, from time to time, for principal and interest by a Governmental Unit to the Bond Bank on the Governmental Unit's Municipal Bonds. "Notes" — Any obligations referred to in the 2005 General Bond Resolution issued by the Bond Bank other than Bonds. "Operating Fund" — A fund established by the 2005 General Bond Resolution. This fund is not held by the Trustee and money therein is not pledged as security for Bonds. "Outstanding" — When used with reference to Bonds, shall mean, as of any date, Bonds theretofore or then being delivered under the provisions of the 2005 General Bond Resolution, other than Bonds owned or held by or for the account of the Bond Bank except: (i) any Bonds cancelled by the Trustee at or prior to such date, (ii) any Bonds for the transfer or exchange of or in lieu of or in substitution for which other Bonds shall have been delivered pursuant to the 2005 General Bond Resolution, and (iii) Bonds deemed to have been paid as provided in the 2005 General Bond Resolution. "Reserve Fund" — The reserve account established by the 2005 General Bond Resolution and held by the Trustee pursuant to the provisions of the 2005 General Bond Resolution. "Reserve Fund Obligations" — Bonds issued by the Bond Bank to obtain funds to deposited in the Reserve Fund. 31 "Reserve Fund Requirement" — The amount required to be on deposit in the 2005 General Bond Resolution Reserve Fund is the least of the following: (i) 10% of the initial stated principal amount of each Series of Bonds then Outstanding; (ii) maximum annual principal and interest requirements on all Bonds then Outstanding; (iii) 125% of average annual principal and interest requirements on all Bonds then Outstanding; or (iv) such lesser amount as shall be required by law. The Reserve Fund Requirement may be satisfied entirely, or in part, by Credit Enhancement; provided, however, any Credit Enhancement satisfying all or any part of the Reserve Fund Requirement after the initial issuance of Bonds or issued in substitution for any prior Credit Enhancement previously issued will not, by itself, cause a withdrawal or downward revision of the ratings maintained by any Rating Agency with respect to the Bonds. "Required Debt Service Reserve" — As of any date of calculation, the amount required to be on deposit in the Reserve Fund which amount shall at least be equal to the Reserve Fund Requirement. "Series Resolution" — A resolution of the Bond Bank authorizing the issuance of a series of Bonds in accordance with the terms of the 2005 General Bond Resolution. "2005 General Bond Resolution" — The Bond Bank's 2005 General Obligation Bond Resolution adopted July 13, 2005, as amended on August 19, 2009. (The Bond Bank may adopt additional general obligation resolutions for the same or different purposes.) The amendments adopted on February 19, 2013 in Resolution No. 2013-02 will be effective after all Bonds outstanding on February 19, 2013 no longer are outstanding. See the forms of the 2005 General Bond Resolution and Resolution No. 2013-02 in Appendix F. MISCELLANEOUS The summaries or descriptions of provisions in the Bond Resolution and all references to other materials not purporting to be quoted in full are only brief outlines of certain provisions thereof and do not constitute complete statements of such documents or provisions, and reference is hereby made to the complete documents and materials, copies of which will be furnished by the Bond Bank on request. The 2005 General Bond Resolution as amended is included herein as Appendix F. Any statements made in this Official Statement indicated to involve matters of opinion or estimates are represented as opinions or estimates in good faith. No assurance can be given, however, that the facts will materialize as so opined or estimated. OFFICIAL STATEMENT The Bond Bank has authorized the execution and distribution of this Official Statement. ALASKA MUNICIPAL BOND BANK /s/ Deven J. Mitchell Executive Director [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX A Proposed Form of Opinion of Bond Counsel [THIS PAGE INTENTIONALLY LEFT BLANK] PROPOSED FORM OF OPINION OF BOND COUNSEL February 2, 2016 Alaska Municipal Bond Bank Juneau, Alaska Alaska Municipal Bond Bank General Obligation and Refunding Bonds, 2016 Series One (Final Opinion) Ladies and Gentlemen: We have acted as bond counsel to the Alaska Municipal Bond Bank (the “Bank”) in connection with issuance of $33,015,000 aggregate principal amount of Alaska Municipal Bond Bank General Obligation and Refunding Bonds, 2016 Series One (the “Bonds”), issued pursuant to the General Obligation Bond Resolution, adopted by the Board of Directors (the “Board”) of the Bank on July 13, 2005 (as amended, the “2005 General Bond Resolution”), as supplemented by Resolution No. 2015-05, adopted by the Board on December 15, 2015 (the “2016 Series One Resolution” and together with the 2005 General Bond Resolution, the “Bond Resolution”). The Bank has appointed The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) under the Bond Resolution. The Bonds are issued for the stated purposes of (i) making loans to three Governmental Units to finance or refinance projects; (ii) making a loan to one Governmental Unit for purposes of refunding certain of the Governmental Unit’s outstanding bonds and a corresponding portion of the Bank’s outstanding general obligation bonds; (iii) purchasing a debt service reserve surety policy for deposit to the Reserve Fund; and (iv) paying costs of issuing the Bonds. In connection with such loans, the Authority is purchasing Municipal Bonds securing payments to be made pursuant to the Loan Agreements mentioned below. Capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Bond Resolution. In such connection, we have reviewed the Bond Resolution; the Loan Agreement, dated as of January 20, 2016 (the “Kodiak Loan Agreement”), between the Bank and the Kodiak Island Borough (“Kodiak”); the Loan Agreement, dated as of January 20 2016 (the “Kenai Loan Agreement”), between the Bank and the Kenai Peninsula Borough (“Kenai”); the Loan Agreement, dated January 20, 2016 (the “Klawock Loan Agreement”), between the Bank and the City of Klawock (“Klawock”); the Loan Agreement, dated as of April 1, 2008 (the “2008 Series One Loan Agreement”), between the Bank and the City of Seward, Alaska (“Seward” and together with Kodiak, Kenai and Klawock, the “Governmental Units”), as amended by the Amendatory Loan Agreement, dated as of January 20, 2016 (the “2008 Series One Amendatory Loan Agreement” and collectively, the “First Refunding Loan Agreement”), between the Bank and Seward; the Loan Agreement, dated as of July 30, 2008 (the “2008 Series Two Loan Agreement”), between the Bank and Seward, as amended by the Amendatory Loan Agreement, dated as of January 20, 2016, between the Bank and Seward (the “2008 Series Two Amendatory Loan Agreement” and collectively, the “Second Refunding Loan Agreement” and together with the Kodiak Loan Agreement, the Kenai Loan Agreements, the Klawock Loan Agreement and the A-1 Alaska Municipal Bond Bank February 2, 2016 First Refunding Loan Agreement, the “Loan Agreements”); the Tax Certificate, dated the date hereof (the “Tax Certificate”), of the Bank; authorizing ordinances and resolutions and tax certificates of each of the Governmental Units; a Certificate of No Litigation of the Attorney General of the State of Alaska, as counsel to the Bank; the Financial Guaranty Agreement, dated as of February 2, 2016 (the “Financial Guaranty Agreement”), between the Bank and National Public Finance Guarantee Corporation (“National”); the debt service reserve fund surety policy issued by National; opinions of counsel to the Governmental Units; certificates of the Bank, the Trustee, the Governmental Units and others; and such other documents, opinions and matters to the extent we deemed necessary to render the opinions set forth herein. The opinions expressed herein are based on an analysis of existing laws, regulations, rulings and court decisions and cover certain matters not directly addressed by such authorities. Such opinions may be affected by actions taken or omitted or events occurring after the date hereof. We have not undertaken to determine, or to inform any person, whether any such actions are taken or omitted or events do occur or any other matters come to our attention after the date hereof. Accordingly, this letter speaks only as of its date and is not intended to, and may not, be relied upon or otherwise used in connection with any such actions, events or matters. We disclaim any obligation to update this letter. We have assumed the genuineness of all documents and signatures presented to us (whether as originals or as copies) and the due and legal execution and delivery thereof by, and validity against, any parties other than the Bank. We have assumed, without undertaking to verify, the accuracy of the factual matters represented, warranted or certified in the documents and of the legal conclusions contained in the opinions, referred to in the second paragraph hereof. Furthermore, we have assumed compliance with all covenants and agreements contained in the Bond Resolution, each of the Loan Agreements and the Tax Certificate and in each of the tax certificates of the Governmental Units, including (without limitation) covenants and agreements compliance with which is necessary to assure that future actions, omissions or events will not cause interest on the Bonds to be included in gross income for federal income tax purposes. We call attention to the fact that the rights and obligations under the Bonds, the Bond Resolution, the Loan Agreements, the Municipal Bonds and the Tax Certificate and their enforceability may be subject to bankruptcy, insolvency, receivership, reorganization, arrangement, fraudulent conveyance, moratorium and other laws relating to or affecting creditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriate cases and to the limitations on legal remedies against public corporations of the State of Alaska. We express no opinion with respect to any indemnification, contribution, liquidated damages, penalty (including any remedy deemed to constitute a penalty), right of set-off, arbitration, choice of law, choice of forum, choice of venue, non-exclusivity of remedies, waiver or severability provisions contained in the foregoing documents, nor do we express any opinion with respect to the state or quality of title to or interest in any of the assets described in or as subject to the lien of the Bond Resolution, the Loan Agreements or the Municipal Bonds or agreements related thereto or the accuracy or sufficiency of the description A-2 Alaska Municipal Bond Bank February 2, 2016 contained therein of, or the remedies available to enforce liens on, any such assets. Our services did not include financial or other non-legal advice. Finally, we undertake no responsibility for the accuracy, completeness or fairness of the Official Statement or other offering material relating to the Bonds and express no opinion with respect thereto. Based on and subject to the foregoing, and in reliance thereon, as of the date hereof, we are of the following opinions: 1. The Bonds constitute the valid and binding general obligations of the Bank. 2. The Bond Resolution has been duly adopted by, and constitutes the valid and binding obligation of, the Bank. To secure the payment of the principal of and interest on the Bonds, the Bond Resolution creates a valid pledge of the Municipal Bonds, all Municipal Bond Payments, the investments thereof and the proceeds of such investments, and any other amounts held by the Trustee in any fund or account established pursuant to the Bond Resolution, except the Rebate Fund, subject to the provisions of the Bond Resolution permitting the application thereof for the purposes and on the terms and conditions set forth in the Bond Resolution. 3. Interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986. Interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although we observe that it is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Interest on the Bonds is exempt from taxation by the State except for transfer, inheritance and estate taxes. We express no opinion regarding other tax consequences related to the ownership or disposition of, or the amount, accrual or receipt of interest on, the Bonds. Faithfully yours, ORRICK, HERRINGTON & SUTCLIFFE LLP A-3 [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX B State Payments to Governmental Units [THIS PAGE INTENTIONALLY LEFT BLANK] Appendix B State Payments to Governmental Units The State of Alaska (the “State”) disburses to Alaskan cities and boroughs (the “Governmental Units”) funds that generally are available for uses other than paying municipal bond debt service. In the event of default by a Governmental Unit with respect to a Loan Agreement, the Bond Bank is authorized to cause such funds, held in custody by the State prior to disbursement, to be paid over to the Bond Bank. However, the State may at any time reduce or terminate the disbursements or programs under which they are made. Four of the departments of the State that disburse money to Governmental Units are as follows: (1) Department of Education and Early Development. The Department of Education and Early Development (DEED) disburses State aid for educational purposes primarily through the school debt reimbursement, the foundation funding, and pupil transportation programs, in addition to funding for boarding homes, residential boarding, youth in detention, special schools, and the Alaska Challenge Youth Academy programs. The first program provides a system under which the State, subject to annual appropriation by the State Legislature, will reimburse municipalities that operate school districts for certain costs of school construction. State reimbursement applies to debt service on locally issued general obligation school bonds. Timing of reimbursements is determined by municipalities’ debt service payments, and is made throughout the year. This program provides that subject to statutory and regulatory conditions that the State will reimburse municipalities for a pre-determined percentage of debt service incurred for such bonds, depending on when such bonds were issued and the project components. The State has in the past, and may in the future, appropriate less than the full amount to which the municipalities are entitled. When appropriations are less than 100 percent of the entitlement, funds have been allocated pro rata among the eligible school districts. Under the second program, the State aids local school districts in the payment of operating expenses under the State “K-12 foundation” funding which provides education-related aid for operating costs associated with qualified K-12 schools as well as programs such as the handicapped facilities and nutrition programs. The program provides for monthly distributions to the school districts. Under the third program, the state aids local school districts for pupil transportation. The program provides for monthly distributions to the school districts. Under the fourth program, the state has provided one-time grant funds. (2) Department of Revenue. The Department of Revenue disburses shares of various State taxes collected by the within the jurisdiction of certain Governmental Units including aviation fuel, Commercial Passenger Vessel, electric, telephone, liquor and fisheries resources landed and business taxes. Payments are distributed both semi-annually in January and July and annually in October depending upon the type of tax. (3) Department of Commerce, Community and Economic Development. The Department of Commerce, Community and Economic Development (DCCED) administers a payment in lieu of taxes program under which the federal government pays a fee for use of land. The payments received from the federal government are passed through the State to certain Governmental Units. Distributions occur annually in July. The State also disburses money to certain Governmental Units through the DCCED's Capital Matching Grants B-1 program to provide assistance in financing capital projects. Distributions are made throughout the year as approved projects are constructed. Additionally the State Revenue Sharing program provides an annual transfer to certain governmental units based on population. The revenue sharing transfers occur in the first quarter of the fiscal year. (4) Department of Corrections. The Department of Corrections transfers monthly amounts to pay operational expenses of local communities that house prisoners in municipal-owned facilities. In addition to the four sources listed above, the State disburses to Governmental Units funds that are not available for intercept by the Bond Bank to address any shortfalls in a Governmental Unit’s loan repayments to the Bond Bank. A reduction in the distribution of such funds, such as State assistance to Governmental Units to address pension liabilities, could have a negative impact on the financial health of Governmental Units. Sources: State of Alaska, Department of Administration, Division of Finance; State of Alaska, Office of Management and Budget; and State of Alaska, Department of Revenue, Tax Division. Further information regarding the State of Alaska may be found at http://alaska.gov (this reference is not a hyperlink, and, by this reference, the State of Alaska’s website is not incorporated into this Official Statement). B-2 Al a s k a M u n i c i p a l B o n d B a n k Ca p a b i l i t y t o I n t e r c e p t F u n d s FY 2 0 1 4 S h a r e d Ta x e s & F e e s o n e ti m e t r a n s f e r s f o r 7 c a t e g o r i e s o f t a x an d l i c e n s e t y p e (F Y 2 0 1 5 r e s u l t s ar e n o t y e t av a i l a b l e ) FY 2 0 1 6 D O T Re i m b u r s e m e n t Pr o g r a m t r a n s f e r r e d a s de b t s e r v i c e c o m e s d u e se m i - a n n u a l l y ( c u r r e n t ye a r a n n u a l ap p r o p r i a t i o n ) FY 2 0 1 6 P r o j e c t e d Sc h o o l D e b t Re i m b u r s e m e n t tr a n s f e r r e d a s d e b t se r v i c e c o m e s d u e s e m i - an n u a l l y ( c u r r e n t y e a r an n u a l a p p r o p r i a t i o n ) F Y 2 0 1 6 E d u c a t i o n Su p p o r t t r a n s f e r r e d i n 12 l e v e l m o n t h l y in s t a l l m e n t s d u r i n g fi s c a l y e a r ( c u r r e n t ye a r a n n u a l ap p r o p r i a t i o n ) Ma t c h i n g G r a n t s a s o f Ja n u a r y 1 , 2 0 1 6 w i l l be dr a w n d o w n a s pr o j e c t s a r e c o m p l e t e d (c u r r e n t a n d p a s t y e a r ca p i t a l g r a n t ap p r o p r i a t i o n s ) ( 1 ) FY 2 0 1 6 C o m m u n i t y Ja i l s - T r a n s f e r r e d i n 12 l e v e l m o n t h l y pa y m e n t s d u r i n g f i s c a l ye a r ( c u r r e n t y e a r an n u a l a p p r o p r i a t i o n ) FY 2 0 1 6 P I L T tr a n s f e r s Re v e n u e S h a r i n g FY 2 0 1 6 di s b u r s e d a t o n e ti m e b y O c t o b e r of f i s c a l y e a r (c u r r e n t y e a r an n u a l ap p r o p r i a t i o n ) To t a l I n t e r c e p t Ca p a b i l i t y Fi s c a l Y e a r 2 0 1 6 To t a l D e b t Se r v i c e ( 2 ) Coverage Ratio Bo r o u g h s Al e u t i a n s E a s t B o r o u g h $1 , 7 9 7 , 5 3 4 $ 4 5 9 , 4 8 5 $ 7 4 2 , 5 4 8 $ 4 , 6 0 1 , 6 5 8 $ 4 , 3 7 8 , 76 0 0 $ 0 $ 3 8 9 , 2 8 8 $ 1 2 , 3 6 9 , 2 7 3 $ 2 , 6 0 0 , 6 8 9 4 . 7 6 Mu n i c i p a l i t y o f A n c h o r a g e 1, 4 3 3 , 0 4 6 0 4 6 , 1 9 4 , 7 0 7 3 3 0 , 4 6 6, 8 1 8 4 0 7 , 0 9 7 , 2 5 0 0 0 1 4 , 0 4 2 , 6 0 8 7 99 , 2 3 4 , 4 2 9 2 9 4 , 9 0 0 2 , 7 1 0 . 1 9 Ha i n e s B o r o u g h 59 1 , 2 1 1 0 9 7 5 , 6 7 1 2 , 9 2 2 , 2 9 7 1 7 , 3 5 3 , 9 2 0 2 1 5, 9 5 4 0 6 1 3 , 1 5 5 2 2 , 6 7 2 , 2 0 8 1 , 8 3 7 , 4 7 3 1 2 . 3 4 Ci t y & B o r o u g h o f J u n e a u 5, 1 4 4 , 1 2 1 0 1 1 , 9 8 1 , 1 0 6 3 8 , 2 8 1 , 93 3 1 1 , 3 2 7 , 8 7 7 0 0 1 , 9 5 2 , 4 4 4 6 8 , 6 8 7 , 4 8 1 1 7 , 6 7 4 , 6 0 9 3 . 8 9 Ke n a i P e n i n s u l a B o r o u g h ( 3 ) 1, 4 0 2 , 0 8 1 0 2 , 7 8 1 , 0 7 5 8 0 , 8 3 4 , 60 5 1 8 , 3 8 5 , 8 0 2 0 0 2 , 5 6 9 , 1 0 4 1 0 5 , 9 7 2 , 6 6 7 1 3 , 0 7 2 , 8 9 8 8 . 1 1 Ke t c h i k a n G a t e w a y B o r o u g h 3, 0 5 3 , 0 2 2 0 2 , 6 9 8 , 9 7 8 2 2 , 9 9 9 , 7 9 3 1 2 , 7 8 6 , 37 7 0 0 5 9 8 , 1 2 3 4 2 , 1 3 6 , 2 9 3 5 , 9 4 4 , 5 7 1 7 . 0 9 Ko d i a k I s l a n d B o r o u g h ( 3 ) 1, 6 1 4 , 0 2 5 0 5 , 4 7 8 , 0 6 7 2 6 , 8 1 9 , 6 5 9 4 , 4 0 4 , 62 2 0 0 6 9 2 , 6 2 4 3 9 , 0 0 8 , 9 9 7 8 , 0 1 7 , 6 6 1 4 . 8 7 La k e & P e n i n s u l a B o r o u g h $5 5 7 , 8 5 3 $ 0 1 , 8 0 2 , 8 4 0 9 , 1 7 8 , 8 9 1 0 0 0 58 2 , 6 9 0 1 2 , 1 2 2 , 2 7 4 2 , 4 2 8 , 0 5 0 4 . 9 9 No r t h w e s t A r c t i c B o r o u g h 2, 5 3 9 0 4 , 0 5 8 , 0 4 2 3 7 , 8 3 8 , 8 2 6 5 , 5 9 8 , 2 8 9 0 0 4 2 9 , 0 5 8 4 7 , 9 2 6 , 7 5 4 6 , 2 6 9 , 4 1 0 7 . 6 4 Pe t e r s b u r g B o r o u g h 1, 2 6 3 , 7 1 8 0 4 7 0 , 9 7 8 6 , 1 7 2 , 0 2 1 6 , 4 7 5 , 9 2 2 1 7 3, 6 2 6 0 5 1 1 , 8 9 4 1 5 , 0 6 8 , 1 5 9 1 , 6 4 3 , 3 4 8 9 . 1 7 Ci t y & B o r o u g h o f S i t k a 1, 4 6 6 , 5 4 6 0 2 , 4 1 0 , 1 8 8 1 3 , 3 8 6 , 5 6 4 3 1 , 9 7 7 , 1 6 7 3 9 1 , 1 9 4 0 8 6 9 , 3 9 4 5 0 , 5 0 1 , 0 5 3 1 3 , 9 9 8 , 0 0 2 3 . 6 1 Mu n i c i p a l i t y o f S k a g w a y 4, 0 7 7 , 1 1 5 0 0 9 9 2 , 8 7 6 9 , 7 6 9 , 4 6 7 0 0 43 3 , 8 9 4 1 5 , 2 7 3 , 3 5 2 1 , 5 3 6 , 9 7 2 9 . 9 4 Ci t y & B o r o u g h o f W r a n g e l l 36 9 , 6 1 7 0 2 0 1 , 5 7 0 3 , 4 9 0 , 1 3 3 4 , 8 9 1 , 1 4 7 3 2 5, 2 7 4 0 5 6 8 , 6 3 4 9 , 8 4 6 , 3 7 5 3 8 8 , 2 7 6 2 5 . 3 6 Ci t i e s Ad a k $1 8 0 , 2 4 9 $ 0 $ 0 $ 0 $ 0 $ 0 $ 4 3 , 0 8 7 $ 1 0 3 , 0 6 3 $ 3 2 6 , 3 9 9 $ 1 0 4 , 1 3 8 3 . 1 3 Be t h e l * $2 , 6 3 2 0 0 0 1 4 , 6 3 8 , 6 5 1 0 8 5 4 , 9 9 8 37 3 , 9 4 9 1 5 , 8 7 0 , 2 3 0 2 9 1 , 8 3 8 5 4 . 3 8 Co r d o v a 1, 9 0 6 , 9 5 7 0 9 3 0 , 4 4 3 4 , 0 5 7 , 0 9 8 2 , 6 4 8 , 2 8 6 1 3 5 , 30 3 4 1 9 , 4 9 5 1 9 5 , 2 1 1 1 0 , 2 9 2 , 7 9 3 1 , 7 7 4 , 6 6 5 5 . 8 0 Cr a i g 0 0 0 4 , 6 2 7 , 6 1 0 2 , 1 1 8 , 4 2 8 3 2 2 , 7 2 4 2 9 5 , 70 1 1 4 6 , 0 4 1 7 , 5 1 0 , 5 0 4 1 3 5 , 9 9 0 5 5 . 2 3 Di l l i n g h a m 48 9 , 6 4 7 0 7 9 3 , 1 6 1 5 , 9 4 5 , 1 8 7 9 0 4 , 3 1 9 5 2 6 , 8 5 1 44 3 , 8 3 8 2 0 1 , 7 6 4 9 , 3 0 4 , 7 6 7 1 , 1 7 9 , 5 9 0 7 . 8 9 Ho o n a h 74 3 , 2 5 2 0 6 5 , 6 6 7 2 , 2 4 2 , 2 1 6 2 4 2 , 8 0 1 0 1 4 9 ,4 9 6 1 2 7 , 4 6 7 3 , 5 1 9 , 3 5 1 1 0 7 , 6 0 0 3 2 . 7 1 Ho m e r * 13 9 , 0 2 0 0 0 0 5 , 3 7 5 , 7 3 4 4 2 4 , 0 8 0 0 32 2 , 3 3 9 6 , 2 6 1 , 1 7 3 2 8 9 , 7 5 0 2 1 . 6 1 Ke t c h i k a n * 3, 0 3 1 , 2 9 3 0 0 0 1 3 , 0 6 3 , 0 8 3 0 0 4 6 7 , 6 35 1 6 , 5 6 2 , 0 1 1 8 , 7 0 1 , 4 6 4 1 . 9 0 Ke n a i * 34 9 , 1 5 3 0 0 0 1 2 , 6 1 3 , 5 9 5 0 0 4 1 5 , 7 9 8 1 3 , 3 7 8 , 5 4 6 1 7 8 , 7 9 8 7 4 . 8 3 Ki n g C o v e * 51 2 , 6 5 5 0 0 0 5 2 1 , 5 7 9 0 0 1 3 2 , 8 0 0 1 , 1 6 7 , 0 3 4 2 9 2 , 9 7 3 3 . 9 8 Kl a w o c k ( 3 ) 8, 4 9 2 0 0 2 , 3 6 4 , 2 7 8 0 0 1 9 7 , 9 5 7 1 2 8 ,1 4 5 2 , 6 9 8 , 8 7 2 8 0 , 5 0 0 3 3 . 5 3 Ko d i a k * 1, 2 7 4 , 1 5 1 0 0 0 7 , 3 8 6 , 4 4 5 9 9 1 , 5 5 2 0 37 7 , 9 2 6 1 0 , 0 3 0 , 0 7 4 9 6 9 , 7 0 4 1 0 . 3 4 No m e 49 , 9 8 0 0 2 1 3 , 2 2 8 9 , 2 8 1 , 3 8 4 1 5 , 1 7 5 , 7 6 3 0 4 57 , 4 5 2 2 6 0 , 0 6 3 2 5 , 4 3 7 , 8 7 0 7 5 2 , 3 5 9 3 3 . 8 1 No r t h P o l e * 52 , 5 9 7 0 0 0 2 , 4 8 6 , 8 8 5 0 0 1 9 1 , 2 3 4 2 , 7 3 0 , 7 1 6 3 6 , 5 5 0 7 4 . 7 1 Pa l m e r * 1 5 0 , 1 2 8 0 0 0 7 , 0 2 2 , 7 6 8 0 0 3 6 5 , 4 5 3 7 , 5 3 8 , 3 4 9 1 1 1 , 0 5 0 6 7 . 8 8 Sa n d P o i n t * 2 4 3 , 8 1 7 0 0 0 8 , 5 5 1 0 0 1 3 4 , 6 5 3 3 8 7 , 0 2 1 1 8 3 , 1 8 0 2 . 1 1 Sa x m a n * 0 0 0 0 7 6 9 , 7 0 0 0 0 1 1 0 , 8 3 6 8 8 0 , 5 3 6 1 2 , 7 6 3 6 8 . 9 9 Se w a r d * ( 3 ) 8 2 0 , 0 7 4 0 0 0 2 8 , 3 0 1 , 4 9 5 3 6 8 , 9 5 2 0 2 1 6 , 9 9 4 2 9 , 7 0 7 , 5 1 5 3 , 0 9 9 , 9 4 2 9 . 5 8 So l d o t n a * 4 8 , 0 9 0 0 0 0 4 , 1 0 6 , 1 9 9 0 0 2 8 6 , 7 2 7 4 , 4 4 1 , 0 1 6 2 1 9 , 0 7 0 2 0 . 2 7 Un a l a s k a 8, 2 1 8 , 1 7 6 3 6 6 , 7 4 5 6 6 1 , 4 4 9 3 , 9 3 2 , 13 9 5 6 6 , 9 6 5 4 3 1 , 2 0 7 8 1 7 , 9 4 7 3 0 3 , 8 10 1 5 , 2 9 8 , 4 3 8 3 , 5 2 1 , 2 2 6 4 . 3 4 Va l d e z 83 8 , 3 6 8 2 1 3 , 3 8 1 1 , 6 1 9 , 2 5 7 4 , 7 1 5 , 00 7 4 , 7 8 4 , 4 7 2 3 5 4 , 7 4 9 7 3 9 , 8 9 7 2 7 4 ,1 1 8 1 3 , 5 3 9 , 2 4 9 3 4 1 , 9 5 0 3 9 . 5 9 Wa s i l l a * 25 1 , 3 9 2 0 0 0 1 1 , 6 6 6 , 8 2 0 0 0 4 6 5 , 8 7 2 1 2 , 3 8 4 , 0 8 4 4 2 0 , 8 1 9 2 9 . 4 3 Ot h e r J u r i s d i c t i o n s Un i v e r s i t y o f A l a s k a ( 4 ) 38 5 , 9 0 0 , 0 0 0 2 , 1 9 8 , 0 0 9 1 7 5 . 5 7 * C o m m u n i t i e s t h a t a r e l o c a t e d i n a b o r o u g h w h i c h o p e r a t e s t h e p u b l i c s c h o o l s i n t h e c o m m u n i t y a n d r e c e i v e s t h a t r e l a t e d E d u c a t io n S u p p o r t F u n d i n g . (1 ) M a t c h i n g g r a n t s a r e a p p r o p r i a t e d b y t h e A l a s k a S t a t e L e g i s l a t u r e a n d c a n v a r y s i g n i f i c a n t l y f r o m y e a r t o y e a r . (2 ) I n c l u d e s a n n u a l d e b t s e r v i c e a s s o c i a t e d w i t h b o n d s s o l d u n d e r t h e B o n d B a n k ' s 1 9 7 6 R e s o l u t i o n . (3 ) B o r r o w e r s t o t h i s i s s u e . (4 ) I n t e r c e p t a b l e r e v e n u e o f t h e U n i v e r s i t y o f A l a s k a i s c o m p r i s e d o f d i r e c t a p p r o p r i a t i o n s f r o m t h e S t a t e o f A l a s k a . B-3 [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX C Governmental Unit Statistics Regarding Participation in the Bond Bank [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX C GOVERNMENTAL UNIT STATISTICS REGARDING PARTICIPATION IN THE BOND BANK 2005 GENERAL BOND RESOLUTION OUTSTANDING LOAN PRINCIPAL TO GOVERNMENTAL UNIT BORROWERS OF THE ALASKA MUNICIPAL BOND BANK AS OF JANUARY 1, 2016 (Does Not Include 2016 Series One Bonds) OutstandingPercent of BorrowerParOutstanding City and Borough of Sitka145,235,00014.59% Kenai Peninsula Borough111,235,00011.17% City and Borough of Juneau128,435,00012.90% City of Ketchikan102,625,00010.31% University of Alaska86,085,0008.65% Kodiak Island Borough92,640,0009.30% Ketchikan Gateway Borough38,565,0003.87% Northwest Arctic Borough36,060,0003.62% City of Seward36,685,0003.68% City of Unalaska34,685,0003.48% Aleutians East Borough27,275,0002.74% Municipality of Skagway21,415,0002.15% City of Cordova18,665,0001.87% Lake & Peninsula Borough17,145,0001.72% City of Kodiak13,070,0001.31% Petersburg Borough11,280,0001.13% City of Dillingham11,275,0001.13% Haines Borough11,690,0001.17% City of Nome4,950,0000.50% Municipality of Anchorage3,615,0000.36% City of Homer3,475,0000.35% City of Bethel2,635,0000.26% City of Valdez2,505,0000.25% City of Sand Point2,500,0000.25% City of King Cove3,105,0000.31% City of Soldotna2,010,0000.20% City of Craig1,755,0000.18% City of Kenai1,615,0000.16% City and Borough of Wrangell1,265,0000.13% City of Wasilla1,185,0000.12% City of Hoonah1,080,0000.11% City of Palmer785,0000.08% City of Adak755,0000.08% City of North Pole820,0000.08% City of Saxman160,0000.02% Reserve Obligations17,415,0001.75% Total Outstanding Par$995,695,000100.00% C-1 [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX D Summaries of Borrowers Representing 10% or More of Outstanding Principal of Bonds Issued Under the 2005 General Bond Resolution [THIS PAGE INTENTIONALLY LEFT BLANK] Kenai Peninsula Borough - General Fund General Obligation Financial Summary Municipal Financial Position20112012201320142015Average Property Tax Collections Borrower's Property Tax Rate per $1,000$4.50$4.50$4.50$4.50$4.50 $4.50 Municipal Levy $29,058,274$30,419,493$30,823,497$31,750,392$31,685,014 $30,747,334 Current Year's Collections$28,630,610$29,946,804$30,382,636$31,332,596$31,142,025 $30,286,934 Current Collection Rate98.53%98.45%98.57%98.68%98.29%98.50% Total Year's Collections$29,047,448$30,401,500$30,798,608$31,668,476$31,332,596 $30,649,726 Total Collection Rate99.96%99.94%99.92%99.74%98.89%99.69% General Fund Total Ending Fund Balance21,705,814$ 21,466,583$ 23,310,985$ 24,881,372$ 28,138,634$ Unreserved Ending Fund Balance21,454,058$ 21,268,520$ 16,296,148$ 15,896,686$ 16,244,676$ $18,232,018 Expenditures72,163,558$ 71,347,868$ 72,452,478$ 73,376,361$ 78,427,617$ $73,553,576 Fund Balance/Expenditures 30%30%22%22%21%25% Total Revenues70,799,893$ 71,108,637$ 74,255,493$ 74,945,074$ 78,764,253$ $73,974,670 Intergovernmental Revenues8,538,331$ 9,749,464$ 10,392,037$ 9,486,455$ 13,584,084$ $10,350,074 Percentage Intergovernmental 12%14%14%13%17%14% Overall Municipal Debt Position Revenue Debt - Governmental Funds-$ -$ -$ -$ -$ -$ -$ -$ -$ -$ Total Revenue Debt-$ -$ -$ -$ -$ General Obligation Debt - Governmental Funds (General Fund only)33,910,000$ 30,230,000$ 26,820,000$ 45,055,000$ 41,820,000$ General Obligation Debt - Enterprise Funds-$ -$ -$ -$ -$ Total General Obligation Debt33,910,000$ 30,230,000$ 26,820,000$ 45,055,000$ 41,820,000$ Total Revenue and General Obligation Debt33,910,000$ 30,230,000$ 26,820,000$ 45,055,000$ 41,820,000$ Governmental GO Debt/Assessed Value (mry)0.53%0.46%0.40%0.65%0.60% Enterprise GO Debt / Assessed Value (mry)0.00%0.00%0.00%0.00%0.00% Total Revenue and GO Debt/A.V. (mry)0.53%0.46%0.40%0.65%0.60% General Obligation Debt Per Capita $612$536$473$792$732 Total Revenue and GO Debt Per Capita $612$536$473$792$732 General Economic and Demographic Data20112012201320142015 Annual Growth Rate Population 55,400 56,369 56,756 56,862 57,147 0.50% Assessed Value 6,393,531,000$ 6,633,241,000$ 6,716,010,000$ 6,960,196,000$ 6,932,443,000$ -0.41% Assessed Value Per Capita 115,407$ 117,675$ 118,331$ 122,405$ 121,309$ Top 10 Tax Payers as a % of Total Assessed Value15.23%14.38%16.18%17.05%17.05% (mry): most recent year Revenue Debt - Enterprise Funds (1) 2015, 2014 and 2013 Unreserved Fund Balance is Net of Note Receivable to the City of Homer in the amount of $11,333,498, $8,944,837 and $6,944,837 respectively for installation of natural gas to community, secured by assessments on all benefited properties D-1 2011 2012 2013 2014 2015 ASSETS Capital Assets (net of depreciation)$67,842,931$64,853,893$69,429,959$71,387,990$93,151,047 Cash21,700,302 27,803,487 35,197,813 35,508,443 37,638,411 Cash held for Plant Replacement10,097,241 11,421,461 11,322,729 16,447,887 18,838,950 Restricted Assets3,584,121 633,493 500,000 4,693,402 5,069,037 Unspent bond proceeds 31,275,450 18,468,485 Other Assets19,105,718 29,383,574 29,863,006 32,652,905 38,942,891 Total Assets122,330,313 134,095,908 146,313,507 191,966,077 212,108,821 LIABILITIES AND NET ASSETS Revenue Bonds Payable- - - 32,490,000 33,890,000 GO Bonds Payable35,990,000 32,255,000 30,130,000 27,905,000 25,670,000 Other Liabilities10,965,610 18,041,771 18,176,258 20,336,761 24,137,535 Total Liabilities46,955,61050,296,77148,306,25880,731,76183,697,535 NET ASSETS 75,374,703 83,799,137 98,007,249 111,234,316 128,411,286 Operating Revenues101,279,075 116,849,605 123,951,269 126,713,712 144,009,565 Operating Expenses86,771,449 99,255,770 102,247,165 104,364,018 117,067,440 Depreciation8,056,595 8,004,562 7,959,305 8,066,688 8,471,959 Operating Income (Loss)6,451,031 9,589,273 13,744,799 14,283,006 18,470,166 Non-Operating Revenue (Expense)(1,105,595)(808,253)(1,541,657)(1,070,583)(1,300,456) Net Income (Loss) Before Contribution5,345,436 8,781,020 12,203,142 13,212,423 17,169,710 Capital Contributions212,945 52,843 2,004,970 14,644 7,260 Change in Net Position5,558,3818,833,86314,208,11213,227,06717,176,970 Central Peninsula General Hospital FINANCIAL SUMMARY D-2 CITY AND BOROUGH OF SITKA GENERAL OBLIGATION FINANCIAL SUMMARY Municipal Financial Position20112012201320142015Average Property Tax Collections Borrower's Property Tax Rate per $1,000$6.00$6.00$6.00$6.00$6.00 $6.00 Municipal Levy $5,799,400$5,904,617$5,957,735$5,901,738$6,032,826 $5,919,263 Current Year's Collections$5,753,039$5,874,918$5,893,452$5,842,721$6,006,776 $5,874,181 Current Collection Rate99.20%99.50%98.92%99.00%99.57%99.24% Total Year's Collections$5,807,869$5,909,321$5,893,452$5,842,721$6,006,776 $5,892,028 Total Collection Rate100.15%100.08%98.92%99.00%99.57%99.54% General Fund Unreserved Ending Fund Balance11,508,475$ 13,584,873$ 14,268,394$ 15,996,580$ 14,720,675$ 14,015,799$ Expenditures23,260,649$ 24,075,729$ 23,691,912$ 23,628,379$ 30,621,436$ 25,055,621$ Fund Balance/Expenditures 49%56%60%68%48%56.38% Total Revenues24,709,916$ 26,584,728$ 25,953,885$ 26,507,173$ 29,227,140$ 26,596,568$ Intergovernmental Revenues2,380,298$ 2,659,323$ 2,693,860$ 2,771,990$ 2,807,749$ 2,662,644$ Percentage Intergovernmental 10%10%10%10%10%10.02% Overall Municipal Debt Position Revenue Debt - Enterprise Funds68,807,401$ 68,593,411$ 106,145,822$ 108,940,000$ 123,215,000$ 165,750$ 156,000$ 146,250$ 202,641$ 189,409$ General Obligation Debt - Governmental Funds36,300,000$ 32,290,000$ 31,020,000$ 28,635,000$ 25,990,000$ General Obligation Debt - Enterprise Funds-$ -$ -$ -$ -$ Total General Obligation Debt36,300,000$ 32,290,000$ 31,020,000$ 28,635,000$ 25,990,000$ Total Revenue and General Obligation Debt105,273,151$ 101,039,411$ 137,312,072$ 137,777,641$ 149,394,409$ Governmental GO Debt/Taxable Assessed Value 3.69%3.26%3.10%2.91%2.58% Total Revenue and GO Debt/A.V.10.69%10.20%13.72%14.01%14.86% General Obligation Debt Per Capita $4,138$3,607$3,415$3,152$2,868 Total Revenue and GO Debt Per Capita $12,000$11,287$15,116$15,167$16,488 General Economic and Demographic Data20112012201320142015 Annual Growth Rate Population 8,773 8,952 9,084 9,084 9,061 -0.25% Taxable Assessed Value 985,073,129$ 990,930,238$ 1,001,066,784$ 983,623,000$ 1,005,471,000$ 2.22% Assessed Value Per Capita 112,285$ 110,694$ 110,201$ 108,281$ 110,967$ Top 10 Tax Payers as a % of Assessed Value7.64%7.57%7.57%7.57%7.57% The Borough has not completed its fiscal year 2015 audit as of the date of the preparation of this table. Revenue Debt - Governmental Funds D-3 City and Borough of Sitka Electric Enterprise Fund Financial Summary 2011 2012 2013 2014 2015 Assets Cash24,320,421 31,450,650 28,803,187 13,505,669 4,447,481 Restricted Assets6,871,164 3,595,875 21,197,459 18,121,955 21,733,477 Other Assets5,010,167 7,266,275 13,897,615 11,777,153 7,988,506 Construction in Progress11,646,987 18,086,724 58,930,539 137,885,040 12,535,308 Utility Plant in Service63,103,150 61,775,003 59,900,343 59,508,277 217,550,674 Total Assets 110,951,889 122,174,527 182,729,143240,798,094 264,255,446 Liabilities and Net Assets Liabilities Other Liabilities1,722,772 2,477,182 6,355,564 13,017,817 3,355,323 Revenue Bonds Payable48,700,000 47,570,000 79,485,000 105,100,000 119,510,000 Deferred loss/premium on bonds1,471,509 (1,711,547) 5,943,338 6,742,293 6,347,870 Revenue Note(s) Payable8,800,188 8,535,498 7,973,608 7,973,608 10,050,744 Total Liabilities 60,694,469 56,871,133 99,757,510 132,833,718 139,263,936 Net Assets 50,257,420 65,303,394 82,971,633 107,964,376 124,991,510 Operating Revenues 11,401,523 11,611,319 12,077,554 14,240,772 17,118,321 Operating Expenses Administrative and General1,739,698 2,003,768 1,975,492 2,860,066 2,406,734 Operation and Maintenance5,257,342 5,914,895 5,152,028 4,964,074 7,443,239 Depreciation1,987,558 1,971,739 1,986,195 1,841,712 1,814,707 Operating Income 2,416,925 1,720,917 2,963,839 4,574,920 5,453,641 Nonoperating revenue (expense) Investment Income490,986 459,107 314,600 196,399 313,069 Interest Expense(1,725,198) (2,848,639) (1,678,238) (426,419) (316,203) Other- 625,748 572,946 812,866 463,877 Net Income before contributions and transfers 1,182,713 (42,867) 2,173,147 5,157,766 5,914,384 Capital contributions4,039,237 5,266,050 17,169,455 19,455,106 9,986,217 Extraordinary Item: Net Pension Obligation Relief119,824 139,806 325,771 379,871 1,126,533 Transfer In (Out) net- - (998,128) - - Change In Net Assets 5,341,774 5,362,989 18,670,245 24,992,743 17,027,134 Population of City and Borough8,773 8,952 9,084 9,098 9,061 # of electric customers5,282 5,309 5,403 5,490 5,683 KwH Sold111,795,344 111,048,623 111,155,330111,155,330 105,293,250 Revenue Bond Debt Service3,477,959 3,467,567 4,529,240 5,045,158 7,158,839 Revenue Bond Coverage (> 1.25)1.411.431.271.341.27 Note: $2,500,000 transferred into Rate Stabilization Fund in FY2015 $2,006,696 transferred out of Rate Stabilization Fund in FY2015 Total of rate Stabilization Fund as of June 30, 2015 - $3,001,304 The Borough has not completed its fiscal year 2015 audit as of the date of the preparation of this table. D-4 2011 2012 2013 2014 2015 ASSETS Plant In-Service (net of depreciation)14,789,299 14,122,591 13,550,231 13,153,475 20,560,565 Land 90,000 90,000 90,000 90,000 90,000 Construction Work in Progress20,22957,838665,4767,824,365939,917 Cash3,733,4674,735,1016,599,1876,616,9547,595,507 Restricted Assets- - 3,615,663 589,166 317,566 Other Assets1,342,5721,339,3891,216,3851,524,8981,036,361 Total Assets19,975,56720,344,91925,736,94229,798,85830,539,916 LIABILITIES AND NET ASSETS Revenue Bonds Payable004,569,4863,840,0003,705,000 Other Liabilities1,405,2271,156,0031,144,1381,689,0331,592,094 Total Liabilities1,405,2271,156,0035,713,6245,529,0335,297,094 NET ASSETS 18,570,34019,188,91620,023,31824,269,82525,242,822 Operating Revenues2,854,8583,154,8853,096,4193,164,252 3,365,977 Operation and Maintenance2,492,1102,434,3291,708,2102,454,5992,194,755 Administrative and General- - - - Depreciation899,956986,619668,511666,074669,102 Operating Income (Loss)(537,208)(266,063)719,69843,579502,120 Non-Operating Revenue (Expense)46,509155,306156,844776,434375,830 Net Income (Loss) Before Contribution(490,699)(110,757)876,542820,013877,949 Capital Contributions1,690,8732,549,94903,458,599122,108 Net Transfers-In (Out)3,804,600675,000(42,141)(32,105)(27,060) Special item - NPO/OPEB write off Change in Net Assets5,004,7743,114,192834,4014,246,507972,997 Population of City8,7738,9529,0849,0989,061 Revenue Bond Coverage No Harbor Bonds No Harbor Bonds No payments of P&I5.16 5.31 The Borough has not completed its fiscal year 2015 audit as of the date of the preparation of this table. CITY AND BOROUGH OF SITKA HARBOR ENTERPRISE FUND FINANCIAL SUMMARY D-5 D-6 D-7 1 D-8 1 Municipal Financial Position20112012201320142015 Average Property Tax Collections Borrower's Property Tax Rate per $1,000$10.51$10.55$10.55$10.66$10.76 $10.61 Municipal Levy $40,739,944$41,751,673$44,252,019$45,108,992$45,852,292 $43,540,984 Current Year's Collections$40,329,083$41,431,682$43,987,108$44,818,184$45,548,172 $43,222,846 Current Collection Rate98.99%99.23%99.40%99.36%99.34%99.26% Total Year's Collections$40,728,566$41,721,795$44,200,111$45,017,746$45,548,172 $43,443,278 Total Collection Rate 99.97%99.93%99.88%99.80%99.34%99.78% General Fund Unassigned Plus Emergency Operating Res (GASB#54)1,729,385$ 3,484,161$ 7,494,734$ 17,285,667$ 20,272,312$ 10,053,252$ Expenditures50,540,314$ 51,283,781$ 84,553,473$ 86,380,150$ 94,808,876$ 73,513,319$ Fund Balance/Expenditures 3.42%6.79%8.86%20.01%21.38%12.09% Total Revenues66,008,466$ 50,036,584$ 88,778,005$ 97,936,255$ 98,018,608$ 80,155,584$ Intergovernmental Revenues14,313,000$ 15,464,700$ 30,635,700$ 41,429,692$ 32,072,000$ 26,783,018$ Percentage Intergovernmental 22%31%35%42%33%32.42% Overall Municipal Debt Position Revenue Debt - Enterprise Funds45,208,341$ 43,679,682$ 41,906,067$ 40,090,908$ 38,436,443$ 3,599,575$ 2,861,747$ 2,091,457$ 6,807,086$ 26,972,320$ General Obligation Debt - Governmental Funds148,301,000$ 133,446,000$ 131,385,000$ 122,068,000$ 115,314,000$ General Obligation Debt - Enterprise Funds-$ -$ -$ -$ -$ Total General Obligation Debt 148,301,000$ 133,446,000$ 131,385,000$ 122,068,000$ 115,314,000$ Total Revenue and General Obligation Debt 197,108,916$ 179,987,429$ 175,382,524$ 168,965,994$ 180,722,763$ Governmental GO Debt/Taxable Assessed Value 3.72%3.28%3.07%2.79%2.57% Total Revenue and GO Debt/A.V.4.94%4.42%4.10%3.86%4.03% General Obligation Debt Per Capita $4,742$4,113$4,023$3,696$3,492 Total Revenue and GO Debt Per Capita $6,302$5,548$5,370$5,116$5,472 General Economic and Demographic Data20112012201320142015 Annual Population 31,275 32,441 32,660 33,030 33,026 -0.01% Taxable Assessed Value 3,989,344,944$ 4,071,713,732$ 4,275,067,217$ 4,379,714,933$ 4,484,327,332$ 2.39% Assessed Value Per Capita 127,557$ 125,511$ 130,896$ 132,598$ 135,782$ Top 10 Tax Payers as a % of Assessed Value13.78%13.73%13.82%13.61%13.61% CITY AND BOROUGH OF JUNEAU FINANCIAL SUMMARY General Governmental Fund Revenue Debt - Governmental Funds D-9 2011 2012 2013 2014 2015 ASSETS Plant In-Service (net of depreciation)$13,827,335$12,844,129$11,875,368$14,325,870$17,517,553 Construction Work in Progress29,889,29433,499,76942,397,974 40,419,69750,214,768 Cash4,728,5224,660,7553,466,3744,030,9923,975,676 Restricted Assets10,702,70311,196,47910,946,32810,554,6149,581,172 Other Assets764,741847,869543,407679,9071,718,645 Total Assets59,912,59563,049,00169,229,45170,011,08083,007,814 LIABILITIES AND NET ASSETS Revenue Bonds Payable9,700,0009,691,5959,380,4349,033,6379,758,734 Other Liabilities2,110,2902,140,9091,401,3652,050,5003,105,738 Total Liabilities11,810,29011,832,50410,781,79911,084,13712,864,472 NET ASSETS 48,102,30551,216,49758,447,65258,926,94370,143,342 Operating Revenues2,854,8583,154,8853,173,2723,508,4304,202,862 Operation and Maintenance2,492,110 2,434,3292,498,1782,814,7173,347,050 Administrative and General- - - - - Depreciation899,956986,619 968,7611,003,7071,150,701 Operating Income (Loss)(537,208)(266,063)(293,667)(309,994)(294,889) Non-Operating Revenue (Expense)46,509155,306(214,686)128,433501,698 Net Income (Loss) Before Contribution(490,699)(110,757)(508,353)(181,561)206,809 Capital Contributions1,690,8732,549,9497,392,466660,8525,788,674 Net Transfers-In (Out)3,804,600675,000500,00006,224,425 Special item - NPO/OPEB write off Change in Net Assets5,004,7743,114,1927,384,113479,29112,219,908 Population of City31,27532,44132,66033,06433,064 Revenue Bond Coverage1.191.791.211.672.60 CITY AND BOROUGH OF JUNEAU HARBOR ENTERPRISE FUND FINANCIAL SUMMARY D-10 2011 2012 2013 2014 2015 ASSETS Plant In-Service (net of depreciation) Construction Work in Progress Cash4,428,233(208,085)(252,013)71,0122,709,760 Restricted Assets- - - Other Assets314,814269,712484,639294,257408,137 Total Assets4,743,04761,627232,626365,2693,117,897 LIABILITIES AND NET ASSETS Revenue Bonds Payable- - - - - Other Liabilities- - 151,020349,585642,980 Total Liabilities- - 151,020349,585642,980 NET ASSETS 4,743,04761,62781,60615,6842,474,917 Operating Revenues2,557,8512,634,0802,825,4792,864,5782,868,633 Operation and Maintenance2,8005,5005,5005,5005,500 Administrative and General- - - - - Depreciation- - - - - Operating Income (Loss)2,555,0512,628,5802,819,9792,859,0782,863,133 Non-Operating Revenue (Expense)- - - - - Net Income (Loss) Before Contribution2,555,0512,628,5802,819,9792,859,0782,863,133 Capital Contributions- - - - - Net Transfers-In (Out)(1,500,000)(7,310,000)(2,800,000)(2,925,000)(403,900) Change in Net Assets1,055,051(4,681,420)19,979(65,922)2,459,233 Population of City 31,27532,44132,66033,06433,064 CITY AND BOROUGH OF JUNEAU PORT DEVELOPMENT SPECIAL REVENUE FUND FINANCIAL SUMMARY D-11 The Bond Bank has received notification from senior management of Wildflower Court that for calendar year 2013 and 2014 Wildflower Court fell short of the required debt service coverage ratio of 1.15 times. Per section 5.1(b) of the loan agreement between the City and Borough of Juneau and Wildflower Court, Wildflower Court is working with the City and Borough to identify measures to return the facility to compliance with the debt service coverage requirement of the loan agreement. Audited financial statements for Wildflower Court for fiscal year 2015 were not available as of the date of the preparation of this table. 2010 2011 2012 2013 2014 ASSETS Plant In-Service5,674,338 4,909,3054,620,999 4,734,678 3,771,100 Cash1,255,8671,582,1281,752,0431,437,0851,970,693 Restricted Assets1,735,1781,707,4022,170,9281,489,3651,450,054 Other Assets1,312,9151,399,5171,444,7491,786,7871,267,699 Total Assets9,978,2989,598,3529,988,7199,447,9158,459,546 LIABILITIES AND NET ASSETS Bond Debt13,650,00013,050,00011,705,00011,596,22910,204,712 Other Liabilities878,190904,4282,052,6631,132,323996,579 Total Liabilities14,528,19013,954,42813,757,66312,728,55211,201,291 NET ASSETS (DEFICIT)(4,549,892)(4,356,076)(3,768,944)3,280,637(2,741,745) Operating Revenues10,361,60910,859,19510,841,32411,057,79111,447,862 Operating Expenses9,802,9449,894,3539,594,3179,666,5309,961,681 Depreciation937,147832,579780,765935,6691,008,253 Operating Income (Loss)(378,482)132,263466,243455,592477,928 Non-Operating Revenue (Expense)27,92461,553120,89032,71360,964 Change in Net Assets(350,558)193,816587,132488,305538,892 Revenue Bond Coverage 1.011.331.321.121.10 City and Borough of Juneau WILDFLOWER COURT (A not for profit organziation) FINANCIAL SUMMARY Conduit Debt D-12 2011 2012 2013 2014 2015 ASSETS Plant In-Service (net of depreciation)$72,772,410$74,566,327$74,002,798$69,208,456$63,710,212 Construction Work in Progress6,866,7816,202,2242,826,314228,4253,647,565 Cash14,990,30817,386,16926,113,83338,596,92144,834,531 Restricted Assets10,160,1146,549,4985,490,7685,327,6735,327,519 Other Assets23,011,26323,462,11325,230,20620,528,16423,810,042 Total Assets127,800,876128,166,331133,663,919133,889,639141,329,869 LIABILITIES AND NET ASSETS Revenue Bonds Payable25,570,00024,926,79525,304,67924,346,61824,346,618 Other Liabilities11,391,0538,999,8678,829,06711,033,87546,306,102 Total Liabilities36,961,05333,926,66234,133,74635,380,49370,652,720 NET ASSETS 90,839,82394,239,66999,530,17398,509,14670,677,149 Operating Revenues90,680,83695,026,37384,250,20780,198,27490,281,184 Operation and Maintenance83,883,38989,411,91376,967,44478,820,47692,676,249 Administrative and General- - - - - Depreciation6,552,1777,145,2907,001,2957,086,5596,815,728 Operating Income (Loss)245,270(1,530,830)281,468(5,708,761)(9,210,793) Non-Operating Revenue (Expense)1,579,6343,306,3664,119,8203,610,23414,405,416 Net Income (Loss) Before Contribution1,824,9041,775,5364,401,288(2,098,527)5,194,623 Capital Contributions89,002471,910134,65800 Net Transfers-In (Out)1,152,6001,152,4001,123,0001,077,5001,054,500 Special item - NPO/OPEB write off Change in Net Assets3,066,5063,399,8465,658,946(1,021,027)6,249,123 Population of City31,27532,44132,66033,06433,064 Revenue Bond Coverage3.633.007.342.508.97 CITY AND BOROUGH OF JUNEAU BARTLETT REGIONAL HOSPITAL FINANCIAL SUMMARY D-13 [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX E Financial Statements of the Alaska Municipal Bond Bank for the Year Ended June 30, 2015 [THIS PAGE INTENTIONALLY LEFT BLANK] ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Financial Statements For the Year Ended June 30, 2015 Together with Independent Auditor’s Report Thereon ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Table of Contents Page Management’s Discussion and Analysis I-VII Financial Statements Independent Auditor’s Report 1-2 Statement of Net Position and Governmental Funds Balance Sheets 3 Statement of Activities and Governmental Funds Statements of Revenues, Expenditures and Changes in Fund Balances/Net Position 4 Notes to Financial Statements 5-21 Supplemental Schedule of Statutory Reserve Accounts – Assets, Liabilities, and Account Reserves 22 Continuing Disclosures Tables 23-30 ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Management’s Discussion and Analysis Year Ended June 30, 2015 -I- This Management's Discussion and Analysis (MD&A) is required by GASB Statement 34, a standard established by the Governmental Accounting Standards Board. This section is intended to make the financial statements more understandable to the average reader who is not familiar with traditional accounting terminology. This financial report has two integral parts: this MD&A and the financial statements with the accompanying notes that follow. Together, they present the Alaska Municipal Bond Bank Authority’s (Bond Bank) financial performance during the fiscal year ended June 30, 2015. Summarized prior fiscal year information is shown within this MD&A, as needed, for comparative purposes. Required Financial Statements GASB 34 requires two types of financial statements: the Statement of Net Position and Governmental Fund Balance Sheets and the Statement of Activities and Governmental Fund Revenues, Expenditures and Changes in Fund Balances/Net Position. These statements report financial information about the Bond Bank's activities using accounting principles generally accepted in the United States of America. In addition to the basic financial statements, the Notes to Financial Statements provide information that is essential to a full understanding of the data provided in the basic financial statements. Financial Highlights During fiscal year 2015, the Bond Bank entered into 11 municipal loan agreements for construction projects in 7 communities. The Bond Bank issued $175.6 million in bonds and had one $3.2 million direct loan, which resulted in $81.9 million in loans to communities for new capital projects, and included $118.0 million used to refinance 25 community loans for savings. Bond Bank bond activity in fiscal year 2015 resulted in present value savings of approximately $17.1 million to the borrowing communities. In comparison, the Bond Bank’s activity level in fiscal year 2014 was an issuance of $178.5 million, resulting in $191.4 million in loans to communities for capital projects. During fiscal year 2014 the Bond Bank entered into 9 municipal loan agreements for new capital projects in 7 communities. The Bond Bank’s community benefit for fiscal year 2014 was present value savings of approximately $12.7 million to the borrowing communities. Statement of Net Position The Statement of Net Position reports assets, liabilities and net position of the Bond Bank. Assets Assets represent 1) The value of the Bond Bank's investments and investment income receivable on the financial statement dates, recorded at fair market value, and 2) Bond principal and interest payments receivable from municipalities. The investments generate income for the Bond Bank, used to meet reserve requirements and pay operating costs. Historically excess operating account earnings were transferred to the State of Alaska’s (State) general fund each year. The fiscal year ending June 30, 2015 marked the eighth consecutive year that the State operating budget has appropriated any excess earnings of the operating account to the Bond Bank’s reserve fund (HB 72, Sec. 25). Interest received on bonds purchased from municipalities is used to pay the Bond Bank's corresponding interest payments on the bonds that it has issued. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Management’s Discussion and Analysis Year Ended June 30, 2015 -II- Liabilities Liabilities represent claims against the fund for 1) goods and services provided before the financial statement date but not yet paid for at that date, and 2) interest and bond payments due to purchasers of the Bond Bank's bonds after the financial statement date. Restricted and Unrestricted Net Position Net position is comprised of two components. The restricted portion reflects monies maintained in separate trust accounts where their use is limited by applicable bond covenants for repayment of bonds. The unrestricted portion reflects monies that are available for any authorized purpose of the Bond Bank. The following table shows the value of Bond Bank assets summarized as of June 30, 2015 and 2014, as well as liabilities and net position: The Bond Bank's investments are all held in U.S. Government securities. The increase in bonds and bond interest receivable, as well as in bonds and bond interest payable, reflects the issuance of approximately $175.6 million in new bonds during the year, net of principal payments on bonds previously issued of approximately $53.1 million. $81.9 million in new bonds and loans during the year were lent to communities for projects, and $118.0 million in new bonds were used to refinance community loans for savings. Included in the totals above is a short-term direct loan to the Kenai Peninsula Borough in the amount of $3.2 million. Changes from 2014 to 2015 20152014Dollars Percent Assets: Cash and investments$72,860,616 $77,969,569 $(5,108,953) -6.55% Bonds and bond interest r eceivable 940,576,872 915,839,560 24,737,312 2.70% Other receivables75,991 - 75,991 100.00% Total assets1,013,513,479 993,809,129 19,704,350 1.98% Liabilities: Accounts payable and accrued liabilities3,352,177 3,318,954 33,223 1.00% Bonds and bond interest payable954,000,573 933,926,183 20,074,390 2.15% Total liabilities957,352,750 937,245,137 20,107,613 2.15% Net Position: Restricted37,473,539 40,270,255 (2,796,716) -6.94% Unrestricted18,687,190 16,293,737 2,393,453 14.69% Total net position$56,160,729 $56,563,992 $(403,263) -0.71% As of June 30, Increase/(Decrease) ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Management’s Discussion and Analysis Year Ended June 30, 2015 -III- Statement of Activities The statement of activities shows how the Bond Bank’s net position changed during the most recent fiscal year. Revenues Revenues include total return on investments and interest payments received from municipalities. Earnings on investments include interest on fixed income marketable securities and the change in fair market value of those investments. Expenses Expenses include interest payments made to bond holders who purchased the Bond Bank's bonds, payments made to the State of Alaska and operating expenses. Operating expenses include all expenditures required to issue bonds during the current year and include in-house expenses, as well as external consultant fees. Expenses are subtracted from revenues. The following is a condensed statement of the Bond Banks’ changes in net position as of June 30, 2015, and 2014: Interest income and expense on bonds receivable and payable are a function of the total amount of bonds outstanding, the age of the bonds and the interest rates at which they are issued. The increases in both of these line items of $9.4 million (interest income) and $9.4 million (interest expense) are consistent with the increase in bond receivable and payable balances, respectively. Investment earnings are a function of market conditions, and active management. The Bond Bank uses other assets to subsidize debt service during times of low investment returns in bond reserve funds. The decrease in net position is primarily due to debt service on reserve obligations. Changes from 2014 to 2015 20152014Dollars Percent Revenues: Interest income on bonds r eceivable$44,121,701 $34,752,725 $9,368,976 26.96% Investment earnings1,141,876 859,892 281,984 32.79% Total income45,263,577 35,612,617 9,650,960 27.10% Expenses: Interest expense on bonds payable44,962,647 35,606,432 9,356,215 26.28% Operating expenses704,193 841,091 (136,898) -16.28% Total expenses45,666,840 36,447,523 9,219,317 25.29% Change in net position(403,263) (834,906) 431,643 51.70% Net position, beginning of period56,563,99257,398,898(834,906) -1.45% Net position, end of period$56,160,729 $56,563,992 $(403,263) -0.71% As of June 30, Increase/(Decrease) ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Management’s Discussion and Analysis Year Ended June 30, 2015 -IV- Governmental Funds The governmental funds include the General Fund, which accounts for the primary operations of the Bond Bank, and the Debt Service Fund, which accounts for the resources accumulated and payments made on the long-term debt of the Bond Bank. The primary difference between the governmental funds balance sheet and the statement of net position is the elimination of inter-fund payables and receivables. Bond proceeds are reported as other financing source in the governmental funds statement of revenues and expenses and this contributes to the change in fund balance. In the statement of net position, however, issuing debt increases long-term liabilities and does not affect the statement of activities. Similarly, repayment of debt principal is recorded as expenditure in the governmental funds statement of revenues and expenses and reduces the liability in the statement of net assets. The following tables show governmental funds’ condensed balance sheets and statements of revenues, expenditures and changes in fund balances as of June 30, 2015, and 2014. General Fund Changes from 2014 to 2015 20152014Dollars Percent Assets: Cash, investments and related accrued interest$14,599,556 $17,775,612 $(3,176,056) -17.87% Bonds and bond interest r eceivable4,922,414 1,836,923 3,085,491 167.97% Interfund receivable4,647,7743,363,7491,284,025 38.17% Total assets24,169,744 22,976,284 1,193,460 5.19% Liabilities: Accounts payable and accrued liabilities257,400 187,848 69,552 37.03% Fund Balance: Restricted for debt service4,956,4304,956,430- 0.00% Unassigned18,955,914 17,832,006 1,123,908 6.30% Total fund balance23,912,344 22,788,436 1,123,908 4.93% Total liabilities and fund balance$24,169,744 $22,976,284 $1,193,460 5.19% As of June 30, Increase/(Decrease) ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Management’s Discussion and Analysis Year Ended June 30, 2015 -V- Debt Service Fund General Fund Changes from 2014 to 2015 20152014Dollars Percent Assets: Cash, investments and related accrued interest$58,261,060 $60,193,957 $(1,932,897) -3.21% Bonds and bond interest r eceivable 935,654,458 914,002,637 21,651,821 2.37% Other receivables75,991 - 75,991 100.00% Total assets993,991,509 974,196,594 19,794,915 2.03% Liabilities: Accounts payable and accrued liabilities3,094,777 3,131,106 (36,329) -1.16% Interfund payables4,647,774 3,363,749 1,284,025 38.17% Total liabilities7,742,551 6,494,855 1,247,696 19.21% Fund Balance: Restricted for debt service986,248,958 967,701,739 18,547,219 1.92% Total liabilities and fund balance$993,991,509 $974,196,594 $19,794,915 2.03% As of June 30, Increase/(Decrease) Changes from 2014 to 2015 20152014Dollars Percent Revenues: Interest income$306,561 $281,398 $25,163 8.94% Expenditures: Operating expenses704,193 841,091 (136,898) -16.28% Excess (deficiency) of revenues over expenditures(397,632) (559,693) 162,061 28.96% Other financing sources (uses) - transfers1,521,540 (5,185,772) 6,707,312 129.34% Excess (deficiency) of revenues and transfers over expenditures1,123,908 (5,745,465) 6,869,373 119.56% Fund balance, beginning of period22,788,43628,533,901(5,745,465) -20.14% Fund balance, end of period$23,912,344 $22,788,436 $1,123,908 4.93% As of June 30, Increase/(Decrease) ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Management’s Discussion and Analysis Year Ended June 30, 2015 -VI- Debt Service Fund Long-term Debt At June 30, 2015 the Bond Bank had $940,920,000 of bonds and notes outstanding, up 1.9% from $923,475,000 at June 30, 2014. This excludes conduit debt obligations of the Coastal Energy Loan Program. Payment of principal and interest on the Bond Bank’s Coastal Energy Bond is not secured by a pledge of any amounts held by or payable to the Bond Bank under the General Bond Resolution, including the Reserve Account, and is not in any way a debt or liability of the Bond Bank and accordingly, are not included in the basic financial statements. Please see note (7), to the financial statements. As discussed in the previous sections, net increase in 2015 long term debt balances is due to new bond issuances for loans to communities. Changes from 2014 to 2015 20152014Dollars Percent Revenues: Interest income on bonds receivable$44,099,543 $34,732,354 $9,367,189 26.97% Investment earnings857,473 598,865 258,608 43.18% Total revenues44,957,016 35,331,219 9,625,797 27.24% Expenditures: Interest payments42,333,257 35,947,564 6,385,693 17.76% Principal payments53,070,000 56,605,000 (3,535,000) -6.25% Total expenditures95,403,257 92,552,564 2,850,693 3.08% Excess (deficiency) of revenues over expenditures(50,446,241) (57,221,345) 6,775,104 11.84% Other financing sources (uses): Bond proceeds175,555,000 178,525,000 (2,970,000) -1.66% Payments to Bond Escrow Agent(105,040,000) - (105,040,000) -100.00% Transfers(1,521,540) 5,185,772 (6,707,312) -129.34% Total other financing sources (uses):68,993,460 183,710,772 (114,717,312) -62.44% Excess of revenues and transfers over expenditures18,547,219 126,489,427 (107,942,208) -85.34% Fund balance, beginning of period as previously reported967,701,739 851,793,807 115,907,932 13.61% Removal of conduit debt obligations- (10,581,495) 10,581,495 100.00% Fund balance, beginning of period as restated967,701,739 841,212,312 126,489,427 15.04% Fund balance, end of period$986,248,958 $967,701,739 $18,547,219 1.92% As of June 30, Increase/(Decrease) ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Management’s Discussion and Analysis Year Ended June 30, 2015 -VII- AS 44.85.180(c) was originally enacted in 1975, limiting the Bond Bank outstanding bonds at any time to $150 million. This Statute has been periodically amended to raise the limit, and modify the definition of authorized borrowers. At the beginning of fiscal year 2015, the limit was $1.5875 billion. During fiscal year 2015, the legislature passed, and the Governor signed into law a bill to authorize the Authority to make loans to Joint Action Agencies and Regional Health Organizations, effective May 26, 2015. Joint Action Agency lending is now part of the main political subdivision program. Regional Health Organization lending is limited to no more than $205 million in total, no more than 49% of any single project where the other 51% of the project’s funding is in place, and not more than $102.5 million for any single project. With this legislation, the total debt limit as of June 30, 2015 was $1.7925 billion, comprised of $1.5 billion in authority for political subdivisions, $87.5 million for the University of Alaska, and $205 million for Regional Health Organizations. Total Bond Bank bonds and notes outstanding as of June 30, 2015 was approximately $940.9 million. The limit on additional bond issuance as of June 30, 2015 was approximately $851.6 million, of which $559.1 million of authority was available for the main political subdivision program, $87.5 million has been specifically designated to the University of Alaska, and $205 million has been specifically designated to Regional Health Organizations. Outstanding long term debt is comprised of the following bonds and loans at year end: Contacting the Bond Bank’s Financial Management This financial report is designed to provide our customers, investors, and creditors with a general overview of the Bond Bank’s finances and to demonstrate the Bond Bank’s accountability of its assets. If you have any questions about this report or need additional financial information, contact the Finance Director or the Executive Director of the Bond Bank at (907) 465-2893 or (907) 465-3750 respectively. Changes from 2014 to 2015 20152014Dollars Percent GO bonds payable $940,920,000 $919,090,000 $21,830,0002.38% Revenue bonds payable- 4,385,000 (4,385,000) -100.00% $940,920,000$923,475,000$17,445,0001.89% As of June 30, Increase/(Decrease) BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. BDO is the brand name for the BDO network and for each of the BDO Member Firms. 1 3601 C Street, Suite 600 Anchorage, AK 99503 Tel: 907-278-8878 Fax: 907-278-5779 www.bdo.com Independent Auditor's Report Board of Directors Alaska Municipal Bond Bank Authority Juneau, Alaska Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities and each major fund of the Alaska Municipal Bond Bank Authority (the Authority), a component unit of the State of Alaska, as of and for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise the Authority’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. Auditor's 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 auditor's 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 entity'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 entity'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. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the Alaska Municipal Bond Bank Authority, as of June 30, 2015, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America. 2 Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages I-VII 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 Alaska Municipal Bond Bank Authority’s basic financial statements. The supplemental schedules and tables noted in the table of contents are presented for purposes of additional analysis and are not a required part of the basic financial statements. The supplementary 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. Such 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. September 30, 2015 Anchorage, Alaska ASSETS Cash and cash equivalents922,551$ 4,753,632$ 5,676,183$ -$ 5,676,183$ Investments, at fair value (note 4)13,672,35353,341,86767,014,220 - 67,014,220 Accrued interest receivable: Bonds receivable46,18412,879,45812,925,642 - 12,925,642 Investment securities4,652165,561170,213 - 170,213 Bonds receivable (note 5)4,876,230922,775,000927,651,230 - 927,651,230 Other receivables- 75,991 75,991 - 75,991 Interfund receivables4,647,774- 4,647,774 (4,647,774) - Total assets24,169,744$ 993,991,509$ 1,018,161,253$ (4,647,774) 1,013,513,479 LIABILITIES Accounts payable45,819$ -$ 45,819$ - 45,819 Due to Primary Government211,581- 211,581 - 211,581 Principal and interest payments received in advance- 3,094,7773,094,777 - 3,094,777 Accrued interest payable- - - 13,080,57313,080,573 Interfund payables- 4,647,7744,647,774 (4,647,774) - Long-term liabilities (note 6): Portion due or payable within one year: General obligation bonds payable- - - 56,455,000 56,455,000 Portion due or payable after one year: General obligation bonds payable- - - 884,465,000 884,465,000 Total liabilities257,400 7,742,551 7,999,951 949,352,799 957,352,750 FUND BALANCES/NET POSITION Fund balances: Restricted (note 2)4,956,430986,248,958 991,205,388 (991,205,388) - Unassigned18,955,914 - 18,955,914 (18,955,914) - Total fund balances23,912,344 986,248,958 1,010,161,302 (1,010,161,302) - Total liabilities and fund balances24,169,744$ 993,991,509$ 1,018,161,253$ Net position: Restricted (note 2) 37,473,539 37,473,539 Unrestricted 18,687,190 18,687,190 Total net position 56,160,729$ 56,160,729$ June 30, 2015 General FundDebt Service Fund ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Statement of Net Position and Governmental Funds Balance Sheets TotalAdjustments Statement of Net Position The accompanying notes to the financial statements are an integral part of these statements. -3- Revenues: Investment earnings284,403$ 857,473$ 1,141,876$ -$ 1,141,876$ Interest income on bonds receivable22,15844,099,54344,121,701 - 44,121,701 Total revenues306,561 44,957,016 45,263,577 - 45,263,577 Expenditures / expenses: Debt service: Principal payments- 53,070,000 53,070,000 (53,070,000) - Interest payments / expense- 42,333,25742,333,257 2,629,390 44,962,647 Professional services485,784- 485,784 - 485,784 Personal services175,489- 175,489 - 175,489 Administrative travel36,720- 36,720 - 36,720 Office expense6,200- 6,200 - 6,200 Total expenditures / expenses704,193 95,403,257 96,107,450 (50,440,610) 45,666,840 Excess (deficiency) of revenues over expenditures / expenses(397,632) (50,446,241) (50,843,873) 50,440,610 (403,263) Other financing sources / (uses): Proceeds from bond refunding- 175,555,000 175,555,000 (175,555,000) - Payments to refunded bond escrow agent- (105,040,000) (105,040,000) 105,040,000 - Transfers to/from Custodial Fund1,428,076 (1,428,076) - - - Transfers - internal activities93,464 (93,464) - - - Total other financing sources / (uses)1,521,540 68,993,460 70,515,000 (70,515,000) - Net change in fund balance / net position1,123,908 18,547,219 19,671,127 (20,074,390) (403,263) Fund balances / net position: Beginning of the year22,788,436967,701,739 990,490,175 (933,926,183) 56,563,992 End of the year 23,912,344$ 986,248,958$ 1,010,161,302$ (954,000,573)$ 56,160,729$ For the Year Ended June 30, 2015 ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Statement of Activities and Governmental Funds Statements of Revenues, Expenditures, and Statement of ActivitiesGeneral FundDebt Service FundTotalAdjustments Changes in Fund Balances/Net Position The accompanying notes to the financial statements are an integral part of these statements. -4- ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -5- For the Year Ended June 30, 2015 (1) History/Reporting Entity The Alaska Municipal Bond Bank Authority (Authority or Bond Bank) was created pursuant to Alaska Statute, Chapter 85, Title 44, as amended, (Act) as a public corporation and instrumentality of the State of Alaska (State), but with a legal existence independent of and separate from the State. The Authority is a discretely presented component unit of the State of Alaska for purposes of financial reporting. The Authority commenced operations in August 1975. The Authority was created for the purpose of making monies available to authorized borrowers within the State to finance capital projects primarily through the issuance of bonds by the Authority. Bond proceeds are then used to purchase, from authorized borrowers general obligation and revenue bonds. The bonds are obligations of the Authority, payable only from revenues or funds of the Authority, and the State of Alaska is not obligated to pay principal or interest thereon, and neither the faith and credit nor the taxing power of the State is pledged to the bonds. The municipal bonds and municipal bond payments, investments thereof and proceeds of such investments, if any, and all funds and accounts established by the bond resolution to be held by the Trustee (with the exception of the Coastal Energy Loan Debt Service Program, which is administered by the Authority) are pledged and assigned for the payment of bonds. AS 44.85.180(c) was originally enacted in 1975, limiting Bond Bank outstanding bonds at any time to $150 million. This Statue has been periodically amended to raise the limit, and modify the definition of authorized borrowers. At the beginning of fiscal year 2015, the limit was $1.5875 billion. During fiscal year 2015, the legislature passed, and the Governor signed into law a bill to authorize the Authority to make loans to Joint Action Agencies and Regional Health Organizations, effective May 26, 2015. Joint Action Agency lending is now part of the main political subdivision program. Regional Health Organization lending is limited to no more than $205 million in total, no more than 49% of any single project where the other 51% of the project’s funding is in place, and not more than $102.5 million for any single project. With this legislation, the total debt limit as of June 30, 2015 was $1.7925 billion, comprised of $1.5 billion in authority for political subdivisions, $87.5 million for the University of Alaska, and $205 million for Regional Health Organizations. Total Bond Bank bonds and notes outstanding as of June 30, 2015 was approximately $940.9 million. The limit on additional bond issuance as of June 30, 2015 was approximately $851.6 million, of which $559.1 million of authority was available for the main political subdivision program, $87.5 million has been specifically designated to the University of Alaska, and $205 million has been specifically designated to Regional Health Organizations. (2) Summary of Significant Accounting Policies The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial principles. The most significant of the Authority’s accounting policies are described below. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -6- (a) Government-wide and Fund Financial Statements The government-wide statement of net position and the statement of activities report information on all of the activities of the Authority. For the most part, the effect of interfund activity has been removed from these statements. The balance sheet and statement of revenues, expenditures and changes in fund balances are provided for governmental funds. (b) Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 180 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures are recorded only when payment is due. The Authority reports the following major governmental funds: The General Fund is the Authority’s primary operating fund. It accounts for all financial resources of the Authority, except those required to be accounted for in another fund. The Authority adopts an annual budget for the operating account only which does not encompass entire operations of the General Fund, therefore, budgetary comparison information for the General Fund is not presented. The Debt Service Fund accounts for the resources accumulated and payments made for principal and interest on long-term debt of the Authority. The Authority does not adopt a budget for the Debt Service Fund because it is not legally required to do so. The purposes of each of these funds are described in the following paragraphs: General Fund The General Fund is comprised of a Custodian Account and an Operating Account. The Custodian Account is established to account for appropriations by the State of Alaska Legislature available to fund the Special Reserve Accounts. The Operating Account is established to account for the ordinary operations of the Authority. Moneys are derived from the following sources: (a) amounts appropriated by the Legislature, (b) fees and charges collected, (c) income on investments of the Statutory Reserve Account in excess of required debt service reserves required by bond resolutions and (d) any other monies made available for purposes of the General Fund from any other source. Amounts in the Operating Account may be used to pay (a) administrative expenses of the Authority, (b) fees and expenses of the Trustee and paying agents, (c) financing costs incurred with respect to issuance of bonds and (d) any expenses in carrying out any other purpose then authorized by the Act. The excess revenues of the Operating Account are returned to the State of Alaska. The State of Alaska may appropriate the excess revenues to the Bond Bank Custodian Account to fund Reserve Accounts. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -7- Debt Service Fund Within the Debt Service Fund, separate Debt Service Programs have been established for each bond resolution to account for the portion of bond sale proceeds used to purchase obligations of the municipalities and for the payment of interest and principal on all bonds of the Authority issued under its resolutions. Each program is comprised of an “interest account” and a “principal account”, both of which are maintained by a trustee. The receipts of interest and principal from the municipalities and the Statutory Reserve Account are deposited in these programs and are used to pay interest and principal on the Authority bonds. One additional Debt Service Program has been established to account for transactions not involving bond resolutions. This is the Coastal Energy Loan Debt Service Program. The Coastal Energy Loan Debt Service Program is not maintained by a trustee. Payments of interest and principal by municipalities having coastal energy loans are made directly to the federal government by the municipalities and are accounted for in the Coastal Energy Loan Debt Service Program. Each debt service fund program contains a Statutory Reserve Account established to account for (a) money available to fund debt service reserves required by future bond sales under various bond resolutions (Custodian Account) and (b) debt service reserves which have already been established under various bond resolutions which are to be used in the case of deficiency in a Debt Service Program in accordance with its respective bond resolution (reserve accounts). Separate reserve accounts exist under each bond resolution as follows: 1976 General Bond Resolution – The reserve account is comprised of an ordinary reserve sub- account and a special reserve sub-account. The ordinary reserve sub-account may fund up to one- third of the required debt service reserve and can be funded with bond proceeds or with a transfer from the Custodian Account. The special reserve sub-account must fund at least two-thirds of the required debt service reserve and must be funded with transfers from the Custodian Account. Both sub-accounts are maintained by a trustee. On August 23, 1999, the Authority amended the debt service reserve requirement for the 1976 bond resolution from the greater of the maximum annual debt service requirement of 10% of all municipal loan obligations outstanding to the current test of the least of: (i) 10% of the original stated principal amount of all bonds outstanding; (ii) the maximum annual principal and interest requirements on all bonds then outstanding; (iii) 125% of the average principal and interest requirements on all bonds then outstanding; or (iv) such lesser amount as shall be required to maintain the exemption of interest of all bonds outstanding from inclusion in gross income for federal income tax purposes under the Internal Revenue Code. The amendment took effect at the beginning of fiscal year 2013 when all bonds outstanding as of the date of the passage of the 1999 resolution were retired. The shift in the reserve requirement significantly reduced the 1976 Resolution reserve requirement. However, per the 1976 resolution the Bond Bank cannot remove principal from the reserve (special or ordinary) until all reserve obligations are paid off. Consequently, during fiscal 2013 the Authority defeased the remaining principal reserve obligations of the 1976 resolution reserves and released excess funds to the Custodial Account. 2005 General Bond Resolution – The reserve fund may be funded with transfers from the custodian account, surety policies, bond proceeds, or other funds available to the Bond Bank. 2010 General Bond Resolution – The reserve fund may be funded with transfers from the custodian account, surety policies, bond proceeds, or other funds available to the Bond Bank. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -8- At June 30, 2015, the 1976 General Bond Resolution,2005 General Bond Resolution, and 2010 General Bond Resolution reserves must be the least of: (i) 10% of the initial principal amount of each Series of Bonds outstanding; (ii) the maximum annual principal and interest requirements on all bonds outstanding; (iii) 125% of the average annual debt service on all bonds then outstanding; or (iv) such lower amount as may be allowed by law. Amounts in excess of the required debt service in any reserve are transferred to the Operating Account on a periodic basis. On September 23, 2015 the Bond Bank determined that the amount on deposit in the 1976 Resolution Reserve Fund was below the reserve requirement due to a transfer of funds from the 1976 resolution reserve fund to the 2005 resolution reserve fund during the fiscal year. On September 24, 2015 the Bond Bank deposited $627,000 to replenish the 1976 Resolution Reserve Fund to the October 1, 2015 reserve requirement. As of October 1, 2015 the amount held in the 1976 Resolution Reserve Fund satisfies the reserve requirement and is equal to the amount of debt service due on February 1, 2016. On that date, all remaining bonds issued under the 1976 Resolution will be retired and the amount held in the 1976 Resolution Reserve Fund will be transferred to the Bond Bank’s Custodian Account. (c) Adjustments Certain adjustments are considered to be necessary to the governmental funds in order to present the Authority’s financial position and the results of its operations. These adjustments include the elimination of inter-fund payables and receivables. Additionally, bond proceeds are reported as financing sources in governmental funds and thus contribute to the change in fund balance. In the statement of net position, however, issuing debt increases long-term liabilities and does not affect the statement of activities. Similarly, repayment of principal is an expenditure in the governmental funds and reduces the liability in the statement of net position. (d) Restricted Assets Certain resources set aside for the repayment of the Authority’s bonds, net of certain proceeds from additional bonds issued, are classified as restricted on the statement of net position because they are maintained in separate trust accounts and their use is limited by applicable bond covenants. Cash and cash equivalents and investments include $37,473,539 of restricted assets. These assets were funded as follows: Original State of Alaska appropriation18,601,414$ 2008 appropriation of excess earnings855,347 2009 appropriation of excess earnings819,843 2010 appropriation of excess earnings32,628 2011 appropriation of excess earnings86,814 2012 appropriation for loan forgiveness13,000,000 Total State of Alaska appropriated equity33,396,046$ ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -9- Restricted for Debt Service: Appropriated amounts residing in reserve accounts28,439,616$ Appropriated amounts residing in Custodial account4,956,430 Total State of Alaska appropriated equity33,396,046 Bond Bank equity residing in reserve accounts4,077,493 Total restricted for debt service/net position37,473,539$ (e) Bond Receivables Bond receivables are secured by the revenues or are general obligations of the municipalities. Interest rates correspond with the interest rates on the related bonds payable by the Authority. The bond receivables mature during the same period as the related bond payables. Bond receivables are recorded at the par amount of the bonds issued. (f) Long-Term Obligations In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the statement of net position. Any premium or discount on bond issuance or refunding is not recorded by the Authority as the premium or discount is recorded by the municipalities associated with the issuance and amortized by them, therefore, bonds payable are presented at par. Bond issue costs are generally paid by the municipality but when a portion is paid by the Authority they are paid from the General Account and considered operating expenses. (g) Fund Equity Generally, fund equity represents the difference between the current assets and current liabilities and is classified as fund balance. Bond Bank, in accordance with GASB Statement No. 54 provisions, which require classification of fund balance as nonspendable, restricted, committed, assigned or unassigned, had fund balances in restricted and unassigned categories. Restricted Fund Balance – Restricted fund balance is that portion of fund equity that has constraints placed upon the use of the resources either by an external party or imposed by law. Unassigned Fund Balance – this classification represents fund balance that has not been restricted, committed or assigned to specific purposes within the general fund. The Authority does not have a policy for its use of unrestricted fund balance amounts, therefore, it considers that committed amounts are reduced first (if any), followed by assigned amounts (if any), and then unassigned amounts when expenditures are incurred for purposes for which amounts in any of those unrestricted fund balance classifications could be used. In the government-wide financial statements, restrictions of net position are reported when constraints placed on net position are either externally imposed by creditors or laws or regulations of other governments or imposed by law through constitutional provisions or enabling legislation. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -10- (h) Interfund Receivables, Payables and Transfers Interfund balances represent cash collected or disbursed on behalf of another fund. Interfund transfers are transfers between funds that are required when revenue is generated in one fund and expenditures are paid from another fund. (i) Interest Arbitrage Rebate Bonds issued and funds segregated into reserves after August 15, 1986 are subject to Internal Revenue Service income tax regulations which require rebates to the U.S. Government of interest income earned on investments purchased with the proceeds from the bonds or any applicable reserves in excess of the allowable yield of the issue. Amounts owed are expensed when paid and refunds are recorded when received at the five year anniversary date of the bond issue or upon final repayment. Beginning for FY 2013 the Bond Bank’s arbitrage rebate consultant will update all general obligation bond rebate analysis annually as of June 30. As of June 30, 2015 the Bond Bank’s net arbitrage rebate liability was $-0-. (j) Income Taxes The Authority is exempt from paying federal and state income taxes. (3) Cash The Authority considers all highly liquid investments purchased with an original maturity of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents at June 30, 2015 consist of money market accounts held with various financial institutions. The bank balance of all of the Authority’s cash and cash equivalents are collateralized by securities held in the Authority’s name by its custodial agent. (4) Investments The fair value of debt security investments by contractual maturity as of June 30, 2015 is shown below. Less than 11-56-10More than 10Total General Fund U.S. Treasury securities1,252,441$ 7,984,825$ 1,004,336$ -$ 10,241,602$ U.S. Government agencies securities431,023 2,999,728 - - 3,430,751 1,683,464 10,984,553 1,004,336 - 13,672,353 Debt Service Fund U.S. Treasury securities3,570,518 37,527,012 5,056,641 - 46,154,171 U.S. Government agencies securities2,691,106 4,496,590 - - 7,187,696 6,261,624 42,023,602 5,056,641 - 53,341,867 Total investments7,945,088$ 53,008,155$ 6,060,977$ -$ 67,014,220$ ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -11- Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without penalty. (a) Investment Policies The Authority has distinct investment objectives and policies associated with funds held in the Custodian Account, Reserve Funds, and municipal debt payments received prior to scheduled debt service payment dates. The three classes of funds are listed below: Custodian Account The Custodian Account investment portfolio is designed with the objective of attaining the highest market rate of return subject to the required use of the Custodian Account for operation, funding transfers to the state, and funding reserves. The Custodian Account balance must maintain a minimum balance of $5 million, and be forecasted to maintain that $5 million balance for the subsequent twelve-month period, and an analysis of risk profile and historical benefit between the varying strategies must be undertaken before any shift in the investment strategy of the Account. The Custodian Account has to maintain sufficient liquidity to meet operating requirements, provide the prior fiscal year’s state dividend, and to allow transfers to reserves as needed for bond issuance activity. Long-term preservation of principal is the third objective of the Custodian Account’s investment program. Investments shall be undertaken in a manner that minimizes the probability of long-term loss. o There are no arbitrage restrictions. The bond resolutions limit investments to: o 5% +/- 2% money market funds (no less than $750,000). o 95% +/- 3% government agencies and U.S. Treasuries. o The performance benchmark is 5% +/- 2% three month U.S. Treasury Bill, and 95% +/- 3% Barclays 1-5 year government bond index. The following transactions are prohibited with the Custodian Account unless those transactions have the prior written consent of the Investment Committee: o Short sale of securities (the sale and settlement of a security not currently owned by the Authority and a formal agreement to borrow the security to facilitate the settlement of the short sale); o Purchases of futures, forwards or options for the purpose of speculating (currency futures, forwards and options are permitted only for hedging or to facilitate otherwise permissible transactions); o Borrowing to leverage the return on investments. Extended settlement of securities purchases executed to facilitate or improve the efficiency of a transaction will not be considered borrowing, provided that sufficient cash equivalent securities or receivables are available to facilitate the extended settlement; o Purchases of "private placement" or unrated corporate bonds. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -12- Bond Reserve Funds Preservation of principal is the foremost objective of the Bond Reserve Funds investment program. These funds shall be managed to ensure that the corpus is preserved. These funds will not be expended until the final maturity of the bond issue they secure, unless there is a failure to pay debt service by a community. As there is limited benefit in maximizing return it is the least important objective of the Bond Reserve Funds. It is anticipated that the Reserve Funds cumulative average return should target the blended arbitrage yield limit of the bond issues secured. Bond resolutions limit allowed investment of these funds. Investment risk is examined on an annual basis to ensure that no greater than the minimum level of risk required to achieve the highest probability of earning the arbitrage yield limit on the bonds is incurred. The 2005 and 2010 Reserve Fund bond resolutions limit investments to: o 90% +/- 10% government agencies and U.S. Treasuries with maturities of less than 5 years. o 10% +/- 10% government agencies and U.S. Treasuries with maturities of more than 5 years and less than 10 years. o Performance benchmark is 90% Barclays US 1-5 year government bond index and 10% Barclays US aggregate index. The 1976 Reserve Fund bond resolutions limit investments to: o Government agencies and U.S. Treasuries with maturities of 3 years or less. o Performance benchmark is Barclays US 1-3 year government bond index. Municipal Debt Payments Preservation of principal and liquidity are the foremost objectives of the Municipal Debt Payments investment program, as these funds will be expended within seven business days of receipt. Return on investment is a benefit of holding these funds for the advance payment period, but not the focus of investing the funds. The bond resolutions limit investments to: o 100% Money Market Fund. o Performance benchmark is three-month U.S. Treasury Bill. (b) Concentration Risk Concentration risk is the risk of loss attributed to the magnitude of the Authority’s investment in a single issuer. Concentration limits are not established in the bond indentures and governing agreements for pledged investments. The Authority’s policies set out maximum concentration limits for investments managed by the external investment manager. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -13- (c) Credit Risk Credit risk is the risk of loss due to the failure of the security or backer. The Authority mitigates its credit risk by limiting investments permitted in the investment policies. U.S. Treasury securities and securities of agencies that are explicitly guaranteed by the U.S. government are not considered to have credit risk. (d) Custodial Credit Risk The Authority assumes levels of custodial credit risk for its deposits with financial institutions, bank investment agreements, and investments. For deposits, custodial credit risk is the risk that, in the event of a bank failure, the Authority’s deposits may not be returned. For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty, the Authority will not be able to recover the value of the investment or collateral securities that are in the possession of an outside party. The Authority has not established a formal custodial credit risk policy for its investments. The Authority had no investments registered in the name of a counterparty. (e) Interest Rate Risk Interest rate risk is the risk that the market value of investments will decline as a result of changes in general interest rates. For non-pledged investments, the Authority mitigates interest rate risk by structuring its investments’ maturities to meet cash requirements, thereby avoiding the need to sell securities in the open market prior to maturity. For investments held in trust, investment maturities are structured to meet cash requirements as outlined in its bond indentures and contractual and statutory agreements. (5) Bonds Receivable The General Fund includes bonds receivable with interest rates varying from 1% to 5% due from the City of Galena and Kenai Peninsula Borough with maturities as follow: City of Galena Kenai Peninsula Borough Total General Fund Bonds Receivable 2016162,182$ 395,000$ 557,182$ 2017163,812 383,000 546,812 2018165,457 387,000 552,457 2019167,119 392,000 559,119 2020168,798 398,000 566,798 2021-2025848,862 1,245,000 2,093,862 1,676,230$ 3,200,000$ 4,876,230$ ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -14- Bonds receivable by debt service program at June 30, 2015 mature in varying annual installments as follows: Year ending June 301976 General2005 General2010 GeneralTotal Principal 20162,520,000$ 51,835,000$ 140,000$ 54,495,000$ 2017- 53,870,000 145,000 54,015,000 2018- 54,220,000 150,000 54,370,000 2019- 55,600,000 160,000 55,760,000 2020- 52,885,000 165,000 53,050,000 2021-2025- 241,415,000 900,000 242,315,000 2026-2030- 179,550,000 1,070,000 180,620,000 2031-2035- 124,640,000 1,280,000 125,920,000 2036-2040- 47,815,000 285,000 48,100,000 2041-2045- 40,230,000 - 40,230,000 2046-2050- 13,900,000 - 13,900,000 2,520,000$ 915,960,000$ 4,295,000$ 922,775,000$ (6) Long–Term Liabilities During the year ended June 30, 2015 the Authority’s long-term liabilities changed as follows: BeginningEnd of yearNew debtof year General obligation bonds payable919,090,000$ 175,555,000$ (153,725,000) 940,920,000$ Revenue bonds payable4,385,000 - (4,385,000) - Total923,475,000$ 175,555,000$ (158,110,000)$ 940,920,000$ Repayments/ Adjustments ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -15- Bond Bank’s long term liabilities consist of the following as of June 30, 2015: Debt Service Account IssueInterest rate Principal outstandingInterest rate Principal outstanding 1976 General Bond Resolution Program: 2005-C Series4.00%-5.00%1,425,000$ 5.00%-$ Haines Borough Petersburg Northwest Arctic Borough 2006-A Series4.00%-4.35%1,095,000 4.00%- Aleutians East Borough Ketchikan Gateway Borough Lake and Peninsula Borough Nome Wrangell Total 1976 General Bond Resolution Fund2,520,000 - 2005 Series General Bond Resolution Program: 2005-One Series3.00%-5.00%2,510,000 3.00%-5.00%350,000 Ketchikan, City of Nome Seward 2006-One Series4.00%-6.00%335,000 4.50%-6.00%- Kenai Peninsula Borough Seward 2006-Two Series - Ketchikan, City of4.25%-4.75%32,660,000 5.00%1,765,000 2007-One Series4.00%-5.50%14,865,000 4.00%-5.50%1,265,000 Kenai Peninsula Borough Inter-Island Ferry Authority Nome Northwest Arctic Borough Petersburg Seward Sitka, City and Borough of Wasilla 2007-Two Series3.75%-5.00%22,575,000 4.50%685,000 Kenai Peninsula Borough Aleutians East Borough 2007-Three Series4.25%-5.50%3,775,000 4.00%415,000 Bethel, City of Juneau, City and Borough of 2007-Four Series - Kenai Peninsula Borough4.25%-5.00%1,955,000 4.25%-4.50%1,070,000 2007-Five Series - Kodiak, City of4.00%-6.00%5,425,000 -- 2008-One Series4.00%-5.00%47,385,000 5.00%3,260,000 Dillingham Kodiak Island Borough Kodiak, City of Seward 2008-Two Series4.40%-6.00%9,945,000 4.75%-6.00%1,200,000 Seward Sitka, City and Borough of Skagway 2009-One Series3.00%-5.63%4,000,000 4.00%-5.50%560,000 Kodiak, City of Unalaska, City of 2009-Two Series4.00%-6.00%4,990,000 4.00%-6.00%1,400,000 Cordova Nome, City of Unalaska, City of Kodiak, Island Borough (continued) Statutory Reserve Account Ordinary Reserve Sub-Account ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -16- Debt Service Account IssueInterest rate Principal outstandingInterest rate Principal outstanding 2009-Three Series - Juneau, City and Borough of 2.00%-4.00%6,730,000 2.00%-4.00%495,000 2009-A-Four Series3.00%-4.00%575,000 3.00%-4.00%430,000 Kenai Peninsula Borough Ketchikan Gateway Borough 2009-B-Four Series - Ketchikan Gateway Borough 4.63%-5.40%20,425,000 -- 2010-A-Series One2.00%-5.00%7,515,000 3.00%- Ketchikan, City of Ketchikan Gateway Borough Kenai, City of Northwest Arctic Borough Petersburg Unalaska 2010-B Series One5.99%-6.34%7,415,000 -- Kenai, City of Northwest Arctic Borough Petersburg Unalaska 2010-A Series Two2.00%-3.00%650,000 3.00%325,000 Juneau, City and Borough of Cordova King Cove, City of 2010-B Series Two3.75%-4.91%11,405,000 -- Juneau, City and Borough of Cordova King Cove, City of 2010-A Series Three2.00%-4.00%2,445,000 2.00%-4.00%405,000 Aleutians East Borough Unalaska King Cove, City of 2010-B Series Three4.93%-5.43%6,900,000 -- Aleutians East Borough Unalaska King Cove, City of 2010-A Series Four2.00%-5.00%19,220,000 -- Kenai Peninsula Borough Ketchikan, City of Ketchikan Gateway Borough Sitka, City and Borough of Sitka , City and Borough of (Refunding) Soldotna 2010-B Series Four1.42%-6.26%47,915,000 -- Kenai Peninsula Borough Ketchikan, City of Ketchikan Gateway Borough Sitka, City and Borough of Soldotna 2011-Series One3.00%-5.13%6,980,000 3.00%415,000 Kodiak Island Borough Wrangell 2011-Series Two2.00%-4.38%8,295,000 2.00%815,000 Juneau, City and Borough of Sitka, City and Borough of (continued) Statutory Reserve Account Ordinary Reserve Sub-Account ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -17- Debt Service Account IssueInterest rate Principal outstandingInterest rate Principal outstanding 2011-Series Three2.00%-5.00%67,575,000 2.00%-5.00%1,390,000 Wrangell Aleutians East Borough Northwest Arctic Borough Ketchikan Gateway Borough Kenai Peninsula Borough Cordova Hoonah Skagway Seward Kodiak Island Borough 2012-Series One2.00%-5.00%11,585,000 -- Juneau, City and Borough of (Wildflower Court) Juneau, City and Borough of 2012-Series Two1.75%-5.00%46,605,000 2.00%-4.00%1,900,000 Juneau, City and Borough of Ketchikan, City of Ketchikan Gateway Borough Kodiak Island Borough Nome, City of North Pole, City of Palmer, City of Petersburg Sitka, City and Borough of Valdez 2012-Series Three1.50%-5.00%18,340,000 -- Juneau, City and Borough of (School) Juneau, City and Borough of (REF) Petersburg Haines Borough 2013-Series One2.00%-5.00%91,695,000 -- Juneau, City and Borough of (Hospital Rev Ref) Juneau, City and Borough of Kenai Peninsula Borough Ketchikan Gateway Borough Kodiak Island Borough Sand Point, City of Sitka, City and Borough of (Harbor Sitka, City and Borough of (Electric) 2013-Series Two A2.00%-4.00%17,095,000 -- Homer, City of Ketchikan, City of Ketchikan, City of (REF) Skagway 2013-Series Two B Kodiak Island Borough3.00%-4.00%16,505,000 -- 2013 Series Three1.50%-5.00%70,505,000 -- Juneau, City and Borough of Kenai Peninsula Borough Lake and Peninsula Borough Sitka, City and Borough of 2014-Series One A.38%-5.00%58,530,000 -- Juneau, City and Borough of Kodiak Island Borough Kenai Peninsula Borough- Exempt Kenai Peninsula Borough- Taxable (continued) Statutory Reserve Account Ordinary Reserve Sub-Account ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -18- Debt Service Account IssueInterest rate Principal outstandingInterest rate Principal outstanding 2014-Series Two A3.00%-5.00%45,080,000 -- Ketchikan, City of (Harbor) Ketchikan, City of (Hospital) King Cove, City of 2014-Series Three1.25%-5.00%55,370,000 -- City & Borough of Juneau City of Saxman City & Borough of Sitka City of Adak (REF) Municipality of Ancorage (Rev REF) Haines Borough (REF) Kenai Peninsula City of Nome (REF) Northwest Arctic Borough (REF) Petersburg Borough (REF) City of Seward (REF) City of Seward (REF) - 2 2015-Series One2.00%-5.00%60,635,000 -- City of Craig - New Money City of Cordova - New Money City of Cordova (REF2005A) City of Ketchikan (REF2005A) Northwest Arctic Borough (REF2005A) City and Borough of Sitka (REF2005A) City of Unalaska (REF2005A) Ketchikan Gateway Borough (REF2005E) Aleutians East Borough (REF2006A) City of Nome (REF2006A) City of Wrangell (REF2006A) City and Borough of Sitka (REF2008-2) City of Unalaska (REF2009-1) City of Cordova (REF2009-2) City of Nome (REF2009-2) 2015-Series Two2.00%-5.00%59,550,000 -- City of Cordova - CC Municipality of Skagway - PSB City and Borough of Juneau - PP Municipality of Skagway - PP City and Borough of Juneau - School City and Borough of Juneau (REF2007-3) Kenai Peninsula Borough (REF2007-4) Total 2005 Series General Bond Resolution Fund915,960,000 18,145,000 2010 Series General Bond Resolution Program: 2010-A-1 Series One3.00%-4.00%595,000 -- Ketchikan Gateway Borough 2010-A-2 Series One5.78%-6.86%3,700,000 -- Ketchikan Gateway Borough Total 2010 Series General Bond Resolution Program4,295,000 - 922,775,000$ 18,145,000$ Statutory Reserve Account Ordinary Reserve Sub-Account ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -19- All bonds are secured by bonds receivable and by amounts in the reserve account. The Act further provides that if a municipality defaults on its principal and/or interest payments, upon written notice by the Authority, the State of Alaska must consider paying to the Authority all funds due from the defaulting municipality from the State in an amount sufficient to clear the default. The Bond Bank Executive Director is obligated per resolution to seek and the State may provide an appropriation annually to replenish reserves. This appropriation was requested, and the State has included this appropriation in the fiscal year 2016 State Budget. In October 2014 the Authority issued $55.3 million in general obligation and refunding bonds with interest rates ranging between 1.25% and 5%. The Authority issued the bonds to advance refund $31,145,000 of the outstanding the 2004B (Anchorage) Revenue bond and 2004D, 2005C, 2005-1, and 2006-1 General Obligation bonds with interest rates averaging between 4.188% and 4.95%. The Authority used the net proceeds along with other resources to purchase U.S. government securities. These securities were deposited in an irrevocable trust to provide for all future debt service on the refunded portion of the series bonds listed above. As a result, these bonds are considered defeased, and the Authority has removed the liability from its financial statements. The outstanding principal of the defeased bonds was $31,145,000 at June 30, 2015. The advance refunding reduced total debt service payments over the next 20 years by nearly $3.5 million. This results in an economic gain (difference between the present values of the debt service payments on the old and new debt) of $2.8 million. In February 2015 the Authority issued $60.6 million in general obligation and refunding bonds with interest rates ranging between 2% and 5%. The Authority issued the bonds to advance refund $57,140,000 of the outstanding 2005A, 20005B, 2006A, 2008-1, 2009-1, and 2009-2 General Obligation bonds with interest rates averaging between 3.44% and 4.96%. The Authority used the net proceeds along with other resources to purchase U.S. government securities. These securities were deposited in an irrevocable trust to provide for all future debt service on the refunded portion of the series bonds listed above. As a result, these bonds are considered defeased, and the Authority has removed the liability from its financial statements. The outstanding principal of the defeased bonds was $57,140,000 at June 30, 2015. The advance refunding reduced total debt service payments over the next 20 years by nearly $5.4 million. This results in an economic gain (difference between the present values of the debt service payments on the old and new debt) of $4.9 million. In May 2015 the Authority issued $59.5 million in general obligation and refunding bonds with interest rates ranging between 2% and 5%. The Authority issued the bonds to advance refund $16,755,000 of the outstanding 2007-3 and 2007-4 General Obligation bonds with interest rates averaging between 4.5% and 4.7%. The Authority used the net proceeds along with other resources to purchase U.S. government securities. These securities were deposited in an irrevocable trust to provide for all future debt service on the refunded portion of the series bonds listed above. As a result, these bonds are considered defeased, and the Authority has removed the liability from its financial statements. The outstanding principal of the defeased bonds was $16,755,000 at June 30, 2015. The advance refunding reduced total debt service payments over the next 18 years by nearly $635,000. This results in an economic gain (difference between the present values of the debt service payments on the old and new debt) of $740,000. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -20- The above bonds mature in varying annual installments. The maturities at June 30, 2015 are as follows: 1976 2010 Year ending June 30GeneralGeneralReserveGeneral 20162,520,000$ 51,835,000$ 1,960,000$ 140,000$ 2017- 53,870,000 425,000 145,000 2018- 54,220,000 4,805,000 150,000 2019- 55,600,000 1,035,000 160,000 2020- 52,885,000 925,000 165,000 2021-2025- 241,415,000 4,135,000 900,000 2026-2030- 179,550,000 3,095,000 1,070,000 2031-2035- 124,640,000 - 1,280,000 2036-2040- 47,815,000 1,765,000 285,000 2041-2045- 40,230,000 - - 2046-2050- 13,900,000 - - 2,520,000$ 915,960,000$ 18,145,000$ 4,295,000$ Year ending June 30Total PrincipalTotal Interest 201656,455,000$ 41,814,124$ 201754,440,000 40,384,854 201859,175,000 38,258,782 201956,795,000 35,858,065 202053,975,000 33,488,178 2021-2025246,450,000 132,451,843 2026-2030183,715,000 80,285,636 2031-2035125,920,000 39,690,036 2036-204049,865,000 18,973,450 2041-204540,230,000 8,742,050 2046-205013,900,000 1,265,749 940,920,000$ 471,212,767$ 2005 (7) Conduit Debt Under the Coastal Energy Loan Program (Program), the Authority issued $5,000,000 1986 Series A Coastal Energy Bonds (Bonds) payable to the National Oceanic and Atmospheric Administration (NOAA). The proceeds of these bonds were used to purchase port revenue bonds from the City of Nome. The City of Nome entered into a tripartite agreement with NOAA and the Authority effective August 2, 1994 to defer payment of the principal and accrual of interest for ten years. Effective January 29, 2009 a second amendment to the tripartite agreement was executed. The amendment authorized the issuance of 2009A Bonds for the purpose of refunding by exchange the outstanding City of Nome, Alaska, Port Revenue Bond 1986 Series A. As of June 30, 2015 the aggregate amount outstanding for conduit debt obligations was $4,360,984. Also under the Program, the Authority issued $6,563,000 1987 Series A Coastal Energy Bonds payable to NOAA. The proceeds of these bonds were used to purchase port revenue bonds from the City of St. Paul. The City of St. Paul entered into a tripartite agreement with NOAA and the Authority effective December 14, 2000 to modify and defer payment. As of June 30, 2015 the aggregate amount outstanding for the City of St. Paul conduit debt obligations was $6,005,878. ALASKA MUNICIPAL BOND BANK AUTHORITY (a Component Unit of the State of Alaska) Notes to Financial Statements -21- The related loan payables do not represent a general obligation of the Authority as they are payable only from proceeds received from the City of Nome and St. Paul, respectively. Payment of principal and interest on the Bond Bank’s Coastal Energy Bond is not secured by a pledge of any amounts held by or payable to the Bond Bank under the General Bond Resolution, including the Reserve Account, and is not in any way a debt or liability of the Bond Bank and accordingly, are not included in the basic financial statements. The Coastal Energy Bonds and related accounts are included in the Bond Bank’s statutory limit for total bonds outstanding. (8) Commitments During 2011 State Legislature appropriated $2,450,000 to Bond Bank to issue a 15-year, one percent interest loan to the City of Galena to retire existing debt obligations and make certain utility improvements. The intent of the legislature was that loan repayments made for the loan be paid into the State of Alaska General Fund in accordance with the provisions of the AS 44.85.270(h). The amount of receipts available to the Authority during fiscal 2014 as discussed in Note 2(d), included $178,200 of City of Galena loan repayments for the year ended June 30, 2015. There were no excess receipts over operating expenditures during fiscal year 2015. The amount of Authority receipts determined under AS 44.85.270(h) and, as discussed in Note 2(d), available for transfer by the Authority and appropriation to the Bond Bank Authority Reserve Fund under AS 44.85.270(a) was $-0- for fiscal year 2015; the cumulative state appropriated amount, therefore, remained $33,396,046 at June 30, 2015. The entire Custodian Account balance is available for appropriation, at any time, by the State Legislature. (9) Subsequent Events Subsequent to June 30, 2015, the Bond Bank issued the 2015 Series Three general obligation bonds in the principle amount of $96.21 million. The 2015 Series Three bond proceeds are being used for the following purposes: (i) to make five loans to Governmental Units for new money purposes; and (ii) to pay a portion of the costs of issuance of the 2015 Series Three Bonds. The 2015 Series Three Bond proceeds used for new money purposes include: (i) a loan to the University of Alaska to pay a portion of the costs of constructing a new Combined Heat and Power Plant at the University’s Fairbanks campus; (ii) a loan to Haines Borough for mechanical system upgrades and replacement of an air handling unit at Haines High School; (iii) two loans to the Kodiak Island Borough for expansion of Kodiak High School and for various renewal and replacement projects in Borough schools, and (iv) a loan to the City of King Cove to pay a portion of the costs to construct a run-of-the-river hydroelectric facility. The 2015 Series Three Bonds priced on August 26, 2015, and are expected to close on or about September 16, 2015. The True Interest Cost (TIC) for the total issuance was 4.00% with last maturity on October 1, 2044. Supplemental Schedule ASSETS Cash502$ 1,178,748$ 8,862$ 1,188,112$ Accrued interest receivable4,171160,415975165,561 Marketable securities505,31552,439,321397,23253,341,868 Interaccount receivables787,596- - 787,596 Other receivables- 128,048 - 128,048 1,297,584$ 53,906,532$ 407,069$ 55,611,185$ LIABILITIES Interaccount payables-$ 5,003,712$ 12,977$ 5,016,689$ Bond payable- 18,145,000- 18,145,000 Accrued interest payable- 201,107- 201,107 - 23,349,819 12,977 23,362,796 RESERVES State appropriated- 28,046,530393,08628,439,616 Unappropriated1,401,6702,674,3581,4654,077,493 Unrealized gain (loss)(104,086) (164,175) (459) (268,720) 1,297,584 30,556,713 394,092 32,248,389 1,297,584$ 53,906,532$ 407,069$ 55,611,185$ (A Component Unit of the State of Alaska) ALASKA MUNICIPAL BOND BANK AUTHORITY June 30, 2015 Supplemental Schedule of Statutory Reserve Accounts - Assets, Liabilities, and Account Reserves Total2005 Resolution 2010 Resolution 1976 General "Special" See Independent Auditor's report -22- Continuing Disclosure Tables Pursuant to the Securities and Exchange Commission Rule 15c2-12 and the Authority's continuing disclosure undertakings, the Authority is obligated to provide annual financial information. In addition to annual financial statements the Authority must provide a statement of authorized, issued and outstanding bonded debt, reserve fund balances, and government unit statistics in substantially the same form as Appendix C of official statements of the Authority. The following supplemental information related to the 1976, 2005, and 2010 master resolutions is provided in compliance with the Appendix C filing requirement. OutstandingPercent of BorrowerParOutstanding Lake & Peninsula Borough965,000$ 38.29% Haines Borough835,000 33.13% Northwest Arctic Borough310,000 12.30% Petersburg Borough280,000 11.11% Ketchikan Gateway Borough130,000 5.16% Total Outstanding Par2,520,000$ 100.00% ALASKA MUNICIPAL BOND BANK AUTHORITY (A Component Unit of the State of Alaska) Supplemental Schedule of 1976 Master Resolution Program - Community Concentration June 30, 2015 See Independent Auditor's report -23- Borrower2016* Lake and Peninsula Borough1,003,600$ Haines Borough855,875 Northwest Arctic Borough317,750 Petersburg Borough287,000 Ketchikan Gateway Borough135,200 Total Outstanding Par2,599,425$ ALASKA MUNICIPAL BOND BANK AUTHORITY (A Component Unit of the State of Alaska) Supplemental Schedule 1976 Master Resolution Program Debt Service Requirements June 30, 2015 * Final year in which bonds issued under the 1976 Resolution will be outstanding. See Independent Auditor's report -24- OutstandingPercent of BorrowerParOutstanding City and Borough of Sitka149,205,000$ 15.97% City and Borough of Juneau137,680,000 14.74% Kenai Peninsula Borough117,195,000 12.55% City of Ketchikan104,750,000 11.21% Kodiak Island Borough85,790,000 9.18% Ketchikan Gateway Borough40,300,000 4.31% Northwest Arctic Borough39,055,000 4.18% City of Seward36,950,000 3.96% City of Unalaska35,960,000 3.85% Aleutians East Borough28,610,000 3.06% Municipality of Skagway21,430,000 2.29% City of Cordova18,985,000 2.03% Lake & Peninsula Borough17,780,000 1.90% City of Kodiak13,205,000 1.41% Petersburg Borough11,945,000 1.28% City of Dillingham11,275,000 1.21% Haines Borough10,580,000 1.13% City of Nome5,425,000 0.58% Municipality of Anchorage3,735,000 0.40% City of Homer3,475,000 0.37% City of Bethel2,790,000 0.30% City of Valdez2,725,000 0.29% City of Sand Point2,500,000 0.27% City of King Cove2,175,000 0.23% City of Soldotna2,120,000 0.23% City of Craig1,810,000 0.19% City of Kenai1,615,000 0.17% City and Borough of Wrangell1,550,000 0.17% City of Wasilla1,540,000 0.16% City of Hoonah1,135,000 0.12% City of Palmer860,000 0.09% City of Adak825,000 0.09% City of North Pole820,000 0.09% City of Saxman165,000 0.02% Reserve Obligations18,145,000 1.94% Total Outstanding Par934,105,000$ 100.00% ALASKA MUNICIPAL BOND BANK AUTHORITY (A Component Unit of the State of Alaska) Supplemental Schedule of 2005 Master Resolution Program - Community Concentration June 30, 2015 See Independent Auditor's report -25- Bo r r o w e r 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 2 0 2 0 2 1 2 0 2 2 2 0 2 3 2 0 2 4 2 0 2 5 Ci t y o f K e t c h i k a n U t i l i t y - 2 0 0 5 L o a n 1 , 3 3 1 , 6 8 0 $ 1 , 3 3 2 , 4 8 0 $ - $ - $ - $ - $ - $ - $ - $ -$ Ke n a i P e n i n s u l a B o r o u g h C e n t . E m . S v c s . D i s t . - 2 0 0 6 L o a n 1 2 4 , 8 0 0 - - - - - - - - - Ci t y o f S e w a r d - 2 0 0 6 P o r t L o a n 2 2 3 , 6 0 0 - - - - - - - - - Ci t y o f K e t c h i k a n P o r t - 2 0 0 6 L o a n 2 , 5 5 5 , 0 6 9 2 , 5 5 6 , 9 6 3 2 , 5 5 3 , 0 6 3 2 , 5 4 8 , 0 6 3 2 , 5 5 0 , 0 3 8 2 , 5 4 3 , 8 5 0 2 , 5 4 4 , 3 6 3 2 , 5 4 1 , 3 0 0 2 , 5 3 9 , 5 2 5 2,538,763 Ci t y o f N o m e - 2 0 0 7 R e f u n d i n g 1 7 9 , 8 9 4 1 7 7 , 4 1 9 1 8 0 , 2 4 7 1 8 2 , 8 5 9 1 8 0 , 6 1 9 1 7 8 , 6 0 9 - - - - No r t h w e s t A r c t i c B o r o u g h - 2 0 0 7 R e f u n d i n g 2 5 5 , 8 5 6 1 , 2 5 9 , 8 4 4 1 , 2 4 9 , 1 7 2 1 , 2 4 8 , 3 5 0 1 , 2 4 8 , 8 2 5 1 , 2 4 5 , 1 6 3 - - - - Pe t e r s b u r g B o r o u g h - 2 0 0 7 R e f u n d i n g 1 4 1 , 9 4 4 1 4 5 , 9 1 9 1 4 0 , 1 5 9 1 4 4 , 3 9 1 1 4 3 , 6 8 1 1 4 7 , 9 9 1 - - - - Ci t y o f S e w a r d - 2 0 0 7 R e f u n d i n g 2 3 5 , 6 0 6 2 4 1 , 0 4 4 2 4 1 , 7 0 9 2 3 7 , 3 9 4 2 3 8 , 3 6 3 2 3 4 , 5 2 5 2 3 9 , 9 9 4 - - - Ci t y a n d B o r o u g h o f S i t k a - 2 0 0 7 R e f u n d i n g 8 4 7 , 3 1 9 8 4 8 , 7 8 1 8 5 1 , 6 7 2 8 4 9 , 2 1 9 - - - - - - Ci t y o f W a s i l l a - 2 0 0 7 R e f u n d i n g 4 2 0 , 8 1 9 4 2 1 , 6 8 1 4 2 3 , 2 4 1 4 2 4 , 5 8 8 - - - - - - Ke n a i P e n i n s u l a B o r o u g h - 2 0 0 7 L o a n 3 1 3 , 2 2 5 3 1 2 , 6 2 5 - - - - - - - - Pe t e r s b u r g B o r o u g h - 2 0 0 7 L o a n 9 1 , 4 3 1 8 8 , 5 4 4 9 0 , 7 7 8 9 2 , 8 9 4 9 0 , 1 0 0 9 2 , 3 5 6 8 9 , 4 2 5 9 1 , 2 9 7 9 2 , 9 0 6 89,406 Al e u t i a n s E a s t B o r o u g h - 2 0 0 7 R e f u n d i n g 9 4 5 , 4 3 8 9 4 7 , 3 3 8 1 , 7 7 2 , 2 3 8 1 , 8 1 8 , 3 6 3 1 , 8 3 5 , 8 6 3 1 , 8 4 4 , 9 8 8 1 , 8 5 6 , 9 3 8 2 , 1 2 1 , 9 3 8 2 , 2 7 1 , 7 5 0 2,347,869 So u t h K e n a i P e n i n s u l a H o s p i t a l - 2 0 0 7 R e f u n d i n g 1 4 4 , 7 0 0 1 4 4 , 1 0 0 1 4 3 , 5 0 0 1 4 2 , 8 2 5 1 4 6 , 9 5 0 7 8 9 , 4 5 0 7 8 8 , 2 5 0 7 8 4 , 3 5 0 7 8 7 , 3 2 5 - Ci t y a n d B o r o u g h o f J u n e a u - 2 0 0 7 I I I D o c k L o a n 3 5 3 , 9 2 5 3 5 6 , 3 2 5 3 5 3 , 6 2 5 - - - - - - - Ci t y o f B e t h e l - 2 0 0 7 I I I C o u r t F a c i l i t y L o a n 29 1 , 8 3 8 2 9 3 , 0 3 8 2 9 4 , 1 2 5 2 9 5 , 1 2 5 2 9 0 , 7 5 0 2 9 1 , 0 0 0 2 9 0 , 7 5 0 2 9 0 , 0 0 0 2 9 3 , 6 2 5 291,625 Ke n a i P e n i n s u l a B o r o u g h S o u t h H o s p i t a l S e r v i c e A r e a 6 9 6 , 5 0 6 6 9 4 , 4 1 3 6 9 5 , 3 0 0 - - - - - - - Ci t y o f K o d i a k M & P L o a n 1 2 8 , 6 7 1 1 2 5 , 9 7 1 1 2 8 , 1 2 1 1 2 5 , 1 2 1 1 2 7 , 5 2 1 1 2 5 , 2 8 7 1 2 7 , 8 7 8 1 2 5 , 3 1 3 1 2 7 , 5 9 3 124,700 Ci t y o f K o d i a k L i f t L o a n 24 0 , 3 3 0 2 4 0 , 9 8 0 2 4 1 , 3 3 0 2 4 1 , 3 8 0 2 4 2 , 0 3 0 2 4 3 , 2 7 1 2 4 4 , 1 8 6 2 4 4 , 8 0 4 2 4 5 , 1 2 6 245,119 Ko d i a k I s l a n d B o r o u g h 2 0 0 8 O n e L o a n 6 2 2 , 4 6 0 6 2 4 , 9 6 0 6 2 0 , 1 6 0 6 2 4 , 9 6 0 6 2 3 , 9 6 0 6 2 1 , 3 2 3 6 2 3 , 0 4 8 6 2 3 , 3 6 0 6 2 2 , 2 1 0 624,180 Ci t y o f D i l l i n g h a m 2 0 0 8 O n e L o a n 1, 1 7 9 , 5 9 0 1 , 1 7 6 , 3 4 0 1 , 1 7 8 , 5 4 0 1 , 1 7 4 , 5 4 0 1 , 1 7 4 , 5 4 0 1 , 1 7 6 , 3 9 0 1 , 1 7 6 , 7 5 3 1 , 1 7 9 , 5 6 5 1 , 1 7 4 , 5 1 5 1,176,040 Ko d i a k P o l i c e S t a t i o n 2 0 0 8 O n e L o a n 5 3 1 , 9 9 0 5 3 2 , 2 4 0 5 2 9 , 0 4 0 5 0 5 , 6 4 0 5 0 7 , 8 4 0 5 0 9 , 1 2 8 5 0 4 , 9 9 0 5 0 5 , 3 6 5 5 0 5 , 0 1 5 508,735 Ci t y o f S e w a r d L o n g T e r m C a r e 2 0 0 8 O n e L o a n 1 , 9 7 0 , 1 6 3 1 , 9 7 1 , 9 1 3 1 , 9 7 0 , 5 1 3 1 , 9 7 2 , 7 1 3 1 , 9 7 3 , 3 1 3 1 , 9 6 9 , 7 5 0 1 , 9 6 9 , 4 8 8 1 , 9 7 0 , 9 2 5 1 , 9 6 8 , 7 2 5 1,971,855 Ci t y a n d B o r o u g h o f S i t k a 2 0 0 8 T w o L o a n 3 5 5 , 6 2 0 3 5 3 , 2 2 0 3 5 5 , 1 0 0 - - - - - - - Mu n i c i p a l i t y o f S k a g w a y 2 0 0 8 T w o L o a n 3 9 3 , 0 3 5 3 9 4 , 4 3 5 3 9 5 , 2 1 0 3 9 1 , 1 1 0 3 9 5 , 3 3 0 3 9 3 , 6 3 0 3 9 6 , 2 1 0 3 9 2 , 8 1 5 3 9 3 , 8 0 3 393,923 Ci t y o f S e w a r d 2 0 0 8 T w o L o a n 3 9 3 , 8 8 6 3 9 3 , 6 8 6 3 9 3 , 1 5 1 3 9 4 , 7 5 1 3 9 3 , 1 5 1 3 9 1 , 1 7 6 3 9 3 , 8 1 6 3 9 5 , 8 2 6 3 9 2 , 2 7 6 393,396 Ci t y o f U n a l a s k a 2 0 0 9 O n e L o a n 8 5 7 , 5 0 0 8 6 0 , 5 0 0 8 5 6 , 6 2 5 8 5 5 , 8 7 5 - - - - - - Ci t y o f K o d i a k 2 0 0 9 O n e B o a t L i f t L o a n 6 8 , 7 1 3 6 7 , 7 1 3 7 1 , 5 8 8 7 0 , 3 3 8 6 9 , 0 8 8 6 7 , 8 3 8 7 1 , 4 6 3 6 9 , 9 6 3 6 8 , 4 2 5 66,850 Ci t y o f U n a l a s k a 2 0 0 9 T w o L o a n 5 5 8 , 7 7 5 5 5 8 , 8 0 0 5 6 3 , 5 8 8 5 6 0 , 4 1 3 - - - - - - Ci t y o f C o r d o v a 2 0 0 9 T w o L o a n 8 0 1 , 7 5 0 7 9 8 , 0 6 3 7 9 9 , 1 8 8 8 0 1 , 3 3 8 - - - - - - Ci t y o f N o m e 2 0 0 9 T w o L o a n 2 9 , 8 6 9 2 8 , 8 0 6 3 2 , 7 7 5 3 1 , 4 2 5 - - - - - - Ci t y a n d B o r o u g h o f J u n e a u - 2 0 0 9 T h r e e L o a n 1 , 5 0 0 , 6 5 0 1 , 4 8 5 , 6 0 0 1 , 4 9 5 , 8 0 0 1 , 4 4 4 , 8 0 0 1 , 4 6 8 , 8 0 0 - - - - - Ke t c h i k a n G a t e w a y B o r o u g h - 2 0 0 9 F o u r L o a n 1 , 7 7 7 , 7 6 9 1 , 7 7 5 , 5 1 9 1 , 7 6 8 , 2 3 2 1 , 7 5 4 , 1 0 4 1 , 7 4 3 , 4 7 9 1 , 7 3 1 , 3 9 0 1 , 7 2 2 , 6 4 2 1 , 7 0 7 , 1 0 7 1 , 6 9 4 , 6 5 4 1,684,964 Ci t y o f K e n a i - 2 0 1 0 O n e L o a n 1 7 8 , 7 9 8 1 7 5 , 3 9 8 1 7 6 , 9 9 8 1 7 8 , 3 9 8 1 7 2 , 7 0 4 1 7 2 , 0 1 1 1 7 1 , 0 1 8 1 6 4 , 7 2 5 1 6 3 , 4 3 3 161,840 Ke t c h i k a n G a t e w a y B o r o u g h - 2 0 1 0 O n e L o a n 7 2 9 , 8 0 0 7 2 5 , 8 0 0 7 3 1 , 0 0 0 7 3 0 , 0 0 0 7 2 8 , 0 0 0 - - - - - No r t h w e s t A r c t i c B o r o u g h - 2 0 1 0 O n e L o a n 2 8 3 , 5 6 5 2 8 3 , 1 6 5 2 8 2 , 5 6 5 2 8 1 , 7 6 5 2 8 0 , 7 6 5 2 8 4 , 5 6 5 2 8 1 , 3 1 5 2 7 6 , 1 2 7 2 7 5 , 6 4 0 269,552 Pe t e r s b u r g B o r o u g h - 2 0 1 0 O n e L o a n 2 3 8 , 0 4 4 2 3 9 , 0 9 4 2 3 4 , 4 9 4 2 3 4 , 7 9 4 2 3 4 , 8 9 4 2 3 4 , 7 9 4 2 3 8 , 6 9 4 2 3 5 , 8 4 9 2 3 2 , 0 1 0 227,870 Ci t y o f U n a l a s k a - 2 0 1 0 O n e L o a n 4 2 5 , 1 4 9 4 2 7 , 1 4 9 4 2 8 , 7 4 9 4 2 4 , 9 4 9 4 2 5 , 9 4 9 4 2 6 , 5 4 9 4 2 4 , 2 9 9 4 2 4 , 0 1 7 4 1 7 , 8 3 5 411,055 No r t h w e s t A r c t i c B o r o u g h - 2 0 1 0 R e f u n d i n g 9 6 7 , 2 0 0 - - - - - - - - - Ci t y a n d B o r o u g h o f J u n e a u - 2 0 1 0 T w o L o a n 1 , 1 3 9 , 3 1 9 1 , 1 3 9 , 0 2 9 1 , 1 2 9 , 7 7 2 1 , 1 1 7 , 5 3 4 1 , 1 0 7 , 7 4 4 2 , 4 7 2 , 6 6 5 1 , 8 2 0 , 5 3 9 1 , 7 7 9 , 6 3 9 1 , 5 1 7 , 6 7 3 1,742,096 Ci t y o f C o r d o v a 2 0 1 0 T w o L o a n 4 9 , 7 8 0 4 8 , 4 3 0 4 6 , 8 5 9 4 5 , 1 3 8 4 8 , 1 8 8 4 6 , 0 7 0 - - - - Ci t y o f K i n g C o v e 2 0 1 0 T w o L o a n 4 1 , 5 1 2 4 5 , 7 4 3 4 4 , 7 6 2 4 3 , 6 8 6 4 2 , 5 4 0 4 1 , 3 6 3 4 0 , 1 5 5 3 8 , 8 4 7 4 2 , 3 1 9 40,652 Al e u t i a n s E a s t B o r o u g h - 2 0 1 0 L o a n 3 9 7 , 0 7 8 3 9 8 , 8 7 8 3 9 5 , 3 7 8 3 9 6 , 5 7 8 3 9 7 , 9 6 6 3 9 2 , 9 4 3 3 9 0 , 8 7 7 3 8 3 , 4 4 1 3 8 0 , 6 3 6 372,462 Ci t y o f K i n g C o v e 2 0 1 0 T h r e e L o a n 5 9 , 8 9 2 5 8 , 6 9 2 6 2 , 3 9 2 6 0 , 9 9 2 5 9 , 6 8 0 5 8 , 2 0 5 6 1 , 3 5 9 5 9 , 3 8 9 5 7 , 4 1 9 55,449 Ci t y o f U n a l a s k a 2 0 1 0 T h r e e L o a n 4 3 6 , 2 6 7 4 3 7 , 2 6 7 4 3 7 , 8 6 7 4 3 8 , 0 6 7 4 3 3 , 6 0 5 4 3 2 , 6 1 7 4 2 9 , 3 1 9 4 2 0 , 6 5 2 4 1 6 , 6 1 6 407,211 Ke n a i P e n i n s u l a B o r o u g h 2 0 1 0 F o u r L o a n 1 , 4 6 8 , 0 2 2 1 , 4 5 9 , 8 8 7 1 , 4 4 2 , 7 2 5 1 , 4 3 1 , 3 0 5 1 , 4 1 1 , 7 7 5 1 , 3 9 5 , 2 6 9 1 , 3 7 6 , 2 0 1 1 , 3 5 8 , 9 4 6 1 , 3 3 8 , 2 6 4 1,314,029 Ci t y o f K e t c h i k a n 2 0 1 0 F o u r L o a n 6 2 8 , 0 4 4 6 2 3 , 1 5 3 6 1 6 , 5 4 9 6 0 8 , 1 9 0 6 0 3 , 5 0 0 5 9 7 , 8 5 4 5 8 6 , 1 6 3 5 7 8 , 2 1 4 5 6 8 , 8 4 2 562,857 Ke t c h i k a n G a t e w a y B o r o u g h 2 0 1 0 F o u r L o a n 3 3 3 , 9 7 6 3 3 2 , 1 9 8 3 2 4 , 2 8 7 3 2 0 , 2 0 9 3 1 5 , 2 3 3 3 1 4 , 5 7 4 3 0 8 , 0 9 1 3 0 0 , 7 5 3 2 9 2 , 5 3 4 288,269 Ci t y a n d B o r o u g h o f S i t k a 2 0 1 0 F o u r L o a n 4 , 0 6 4 , 7 3 2 4 , 0 6 4 , 9 3 2 4 , 0 7 5 , 1 5 1 4 , 0 6 2 , 5 7 0 4 , 0 4 7 , 5 7 0 4 , 0 5 8 , 5 7 0 4 , 0 5 0 , 6 4 8 4 , 0 3 8 , 9 2 6 4 , 0 3 0 , 4 1 9 4,000,527 Ci t y o f S o l d o t n a 2 0 1 0 F o u r L o a n 2 1 9 , 0 7 0 2 1 5 , 6 4 6 2 1 6 , 5 9 4 2 1 1 , 9 0 5 2 1 1 , 7 5 2 2 0 6 , 3 1 1 2 0 5 , 5 0 9 1 9 9 , 2 7 9 1 9 7 , 6 0 2 195,333 (continued) AL A S K A M U N I C I P A L B O N D B A N K A U T H O R I T Y (A C o m p o n e n t U n i t o f t h e S t a t e o f A l a s k a ) Su p p l e m e n t a l S c h e d u l e 2 0 0 5 M a s t e r R e s o l u t i o n P r o g r a m - D e b t S e r v i c e R e q u i r e m e n t s Ju n e 3 0 , 2 0 1 5 Se e I n d e p e n d e n t A u d i t o r ' s r e p o r t -2 6 - Bo r r o w e r 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 2 0 2 0 2 1 2 0 2 2 2 0 2 3 2 0 2 4 2 0 2 5 AL A S K A M U N I C I P A L B O N D B A N K A U T H O R I T Y (A C o m p o n e n t U n i t o f t h e S t a t e o f A l a s k a ) Su p p l e m e n t a l S c h e d u l e 2 0 0 5 M a s t e r R e s o l u t i o n P r o g r a m - D e b t S e r v i c e R e q u i r e m e n t s Ju n e 3 0 , 2 0 1 5 Ci t y a n d B o r o u g h o f W r a n g e l l 2 0 1 1 O n e L o a n 2 5 , 0 7 5 2 4 , 4 7 5 2 8 , 8 7 5 2 8 , 0 0 0 2 7 , 0 0 0 2 6 , 0 0 0 - - - - Ko d i a k I s l a n d B o r o u g h 2 0 1 1 O n e L o a n 6 2 1 , 8 5 0 6 2 2 , 5 5 0 6 2 2 , 9 5 0 6 2 1 , 4 0 0 6 2 2 , 8 0 0 6 2 3 , 6 0 0 6 2 3 , 8 0 0 6 2 5 , 5 1 3 6 2 6 , 2 7 5 626,088 Ci t y a n d B o r o u g h o f J u n e a u 2 0 1 1 T w o L o a n 6 5 8 , 8 3 1 6 5 7 , 8 3 1 6 5 8 , 8 3 1 6 5 7 , 3 0 0 6 5 9 , 6 0 0 6 5 5 , 2 0 0 - - - - Ci t y a n d B o r o u g h o f S i t k a 2 0 1 1 T w o L o a n 4 0 7 , 6 0 9 4 0 8 , 0 0 9 4 1 2 , 1 3 4 4 1 0 , 0 9 0 4 0 7 , 5 9 0 4 0 7 , 3 9 0 4 1 1 , 7 9 0 4 0 7 , 6 9 0 4 0 8 , 0 7 1 411,271 Al e u t i a n s E a s t B o r o u g h 2 0 1 1 T h r e e R e f u n d i n g 8 3 3 , 7 5 0 9 7 6 , 6 2 5 2 2 9 , 3 7 5 2 2 9 , 8 7 5 2 2 6 , 0 0 0 2 3 1 , 6 2 5 2 3 0 , 6 2 5 - - - Ke n a i P e n i n s u l a B o r o u g h 2 0 1 1 T h r e e R e f u n d i n g 1 , 6 4 7 , 0 5 0 1 , 6 4 0 , 4 5 0 1 , 6 3 0 , 0 7 5 1 , 6 2 1 , 8 2 5 1 , 6 1 7 , 8 5 0 9 6 7 , 3 7 5 9 5 8 , 7 5 0 9 5 3 , 2 5 0 - - Ke t c h i k a n G a t e w a y B o r o u g h 2 0 1 1 T h r e e R e f u n d i n g 6 2 1 , 2 5 0 6 1 6 , 3 0 0 6 1 8 , 1 7 5 6 1 8 , 8 0 0 6 1 5 , 9 0 0 6 1 6 , 8 7 5 6 1 4 , 0 0 0 6 0 9 , 8 7 5 - - No r t h w e s t A r c t i c B o r o u g h 2 0 1 1 T h r e e R e f u n d i n g 2 , 4 8 4 , 4 0 0 2 , 4 9 1 , 9 0 0 2 , 4 8 6 , 7 7 5 2 , 4 9 2 , 0 2 5 2 , 4 9 2 , 7 0 0 2 , 4 8 8 , 8 7 5 2 , 4 8 5 , 0 0 0 2 , 4 8 5 , 6 2 5 1 , 6 8 1 , 0 0 0 - Wr a n g e l l 2 0 1 1 T h r e e R e f u n d i n g 9 3 , 8 0 0 4 1 , 0 0 0 - - - - - - - - Ke n a i P e n i n s u l a B o r o u g h ( C e n t r a l H o s p i t a l ) 2 0 1 1 T h r e e 3 , 5 2 5 , 0 5 0 3 , 5 2 2 , 1 2 5 3 , 5 2 1 , 7 5 0 3 , 5 2 0 , 0 0 0 3 , 5 2 1 , 0 0 0 3 , 5 2 5 , 5 0 0 3 , 5 2 8 , 6 2 5 3 , 5 3 3 , 7 5 0 3 , 5 2 0 , 8 7 5 - Ci t y o f C o r d o v a 2 0 1 1 T h r e e 5 4 , 8 0 0 5 7 , 8 7 5 5 5 , 6 2 5 5 3 , 3 7 5 5 6 , 2 5 0 5 4 , 0 0 0 5 6 , 3 7 5 - - - Ci t y o f H o o n a h 2 0 1 1 T h r e e 1 0 7 , 6 0 0 1 1 4 , 8 7 5 1 1 1 , 6 2 5 1 1 3 , 2 5 0 9 0 , 5 0 0 9 3 , 1 2 5 9 0 , 3 7 5 9 2 , 5 0 0 8 9 , 5 0 0 91,700 Ko d i a k I s l a n d B o r o u g h 2 0 1 1 T h r e e 2 9 8 , 6 0 0 3 0 0 , 4 7 5 3 0 0 , 9 7 5 3 0 0 , 9 7 5 3 0 1 , 5 5 0 3 0 1 , 6 2 5 3 0 0 , 1 2 5 2 9 8 , 1 2 5 3 0 0 , 5 0 0 298,600 Mu n i c i p a l i t y o f S k a g w a y 2 0 1 1 T h r e e 3 4 , 3 5 0 3 3 , 6 7 5 3 7 , 8 0 0 3 6 , 8 0 0 3 5 , 9 0 0 3 5 , 0 0 0 3 4 , 0 0 0 3 7 , 8 7 5 3 6 , 6 2 5 35,500 Ci t y o f S e w a r d 2 0 1 1 T h r e e 2 4 3 , 3 5 0 2 4 4 , 1 7 5 2 4 4 , 3 0 0 2 4 4 , 1 7 5 2 4 4 , 3 5 0 2 4 4 , 2 7 5 2 4 3 , 4 0 0 2 4 2 , 2 7 5 2 4 5 , 7 7 5 244,600 Ci t y a n d B o r o u g h o f J u n e a u G . O . R e f u n d i n g 2 0 1 2 O n e 1 , 3 1 9 , 1 2 5 1 , 0 9 1 , 6 2 5 - - - - - - - - Ju n e a u W i l d f l o w e r C o u r t R e f u n d i n g 2 0 1 2 O n e 1 , 7 0 2 , 0 2 5 1 , 3 4 4 , 9 0 0 1 , 4 1 8 , 1 2 5 1 , 4 8 6 , 9 2 5 1 , 5 5 5 , 8 2 5 4 3 7 , 7 2 5 4 8 4 , 5 7 5 5 3 4 , 9 6 6 5 8 3 , 4 6 3 442,172 Ju n e a u 2 0 1 2 T w o 1 , 9 0 2 , 1 5 0 1 , 9 2 0 , 4 0 0 1 , 9 4 0 , 2 5 0 1 , 9 5 8 , 4 0 0 - - - - - - Ci t y o f K e t c h i k a n 2 0 1 2 T w o 3 5 6 , 9 4 4 3 5 4 , 4 4 4 3 5 6 , 6 4 4 3 5 2 , 5 1 9 3 5 2 , 0 1 9 3 5 5 , 8 9 4 3 5 5 , 3 4 4 3 5 4 , 2 9 4 3 5 1 , 5 4 4 353,169 Ke t c h i k a n G a t e w a y B o r o u g h 2 0 1 2 T w o 6 8 9 , 1 5 0 6 8 6 , 1 5 0 6 8 2 , 3 5 0 6 8 9 , 2 5 0 6 8 1 , 6 2 5 - - - - - Ko d i a k I s l a n d B o r o u g h 2 0 1 2 T w o 1 , 4 4 9 , 2 5 0 1 , 4 4 9 , 8 5 0 1 , 4 3 9 , 5 0 0 1 , 4 4 7 , 9 5 0 1 , 4 3 9 , 0 2 5 1 , 4 4 2 , 2 7 5 1 , 4 3 3 , 9 5 0 1 , 4 3 3 , 1 2 5 1 , 4 3 3 , 2 5 0 1,435,000 Ci t y o f N o m e 2 0 1 2 T w o 1 4 7 , 3 0 0 1 4 8 , 2 0 0 1 4 8 , 9 0 0 1 4 8 , 8 2 5 1 4 7 , 9 5 0 1 4 6 , 8 2 5 1 4 6 , 1 0 0 1 5 0 , 0 0 0 1 3 3 , 2 5 0 - Ci t y o f N o r t h P o l e 2 0 1 2 T w o 3 6 , 5 5 0 1 0 0 , 2 5 0 1 0 2 , 5 5 0 9 9 , 4 0 0 1 0 0 , 7 7 5 1 0 1 , 9 0 0 1 0 3 , 2 0 0 1 0 4 , 2 5 0 9 9 , 7 5 0 100,125 Ci t y o f P a l m e r 2 0 1 2 T w o 1 1 1 , 0 5 0 1 0 8 , 0 5 0 1 0 5 , 8 0 0 1 0 8 , 4 5 0 1 0 4 , 8 5 0 1 0 5 , 7 2 5 1 0 6 , 8 0 0 1 0 7 , 6 2 5 1 0 7 , 7 5 0 107,625 Pe t e r s b u r g B o r o u g h 2 0 1 2 T w o 4 9 4 , 0 0 0 4 9 0 , 6 0 0 4 9 6 , 6 0 0 4 9 1 , 0 7 5 4 8 8 , 1 2 5 4 8 8 , 3 7 5 4 8 9 , 7 5 0 4 8 5 , 2 5 0 4 6 8 , 1 2 5 246,000 Ci t y a n d B o r o u g h o f S i t k a 2 0 1 2 T w o 1 , 4 5 5 , 6 5 0 1 , 4 5 6 , 2 5 0 1 , 4 6 0 , 1 5 0 1 , 4 5 6 , 7 7 5 1 , 4 5 5 , 6 5 0 1 , 4 5 6 , 6 5 0 1 , 4 5 1 , 2 0 0 1 , 4 5 3 , 0 0 0 1 , 4 5 0 , 3 7 5 630,375 Ci t y o f V a l d e z 2 0 1 2 T w o 3 4 1 , 9 5 0 3 4 7 , 8 5 0 3 4 8 , 2 5 0 3 5 1 , 8 5 0 3 4 3 , 7 2 5 3 4 0 , 2 2 5 3 4 2 , 5 5 0 3 4 4 , 1 2 5 3 4 3 , 5 0 0 317,750 Ha i n e s B o r o u g h 2 0 1 2 T h r e e 8 7 , 2 1 9 8 5 , 9 8 1 8 4 , 7 4 4 8 2 , 7 1 9 8 5 , 3 4 4 8 2 , 8 4 4 8 5 , 2 1 9 8 7 , 3 4 4 8 4 , 3 4 4 86,544 Ju n e a u 2 0 1 2 T h r e e R e f u n d i n g 9 0 9 , 0 5 0 9 1 6 , 9 5 0 9 1 8 , 9 5 0 9 2 8 , 2 5 0 9 3 7 , 1 2 5 9 4 8 , 6 2 5 9 4 7 , 8 7 5 9 5 9 , 7 5 0 9 7 3 , 7 5 0 - Ju n e a u 2 0 1 2 T h r e e S c h o o l C o n s t r u c t i o n 1 , 4 5 5 , 3 7 5 1 , 4 4 0 , 8 3 8 1 , 4 3 0 , 6 0 0 1 , 4 0 0 , 3 7 5 1 , 3 6 3 , 6 2 5 1 , 3 6 4 , 8 7 5 1 , 3 6 3 , 1 2 5 1 , 3 6 3 , 2 5 0 - - Pe t e r s b u r g B o r o u g h 2 0 1 2 T h r e e 1 0 1 , 5 2 5 1 0 4 , 8 3 8 1 0 3 , 0 5 0 1 0 5 , 0 0 0 1 0 1 , 5 0 0 1 0 2 , 8 7 5 1 0 4 , 0 0 0 1 0 4 , 8 7 5 1 0 5 , 5 0 0 101,450 Ke n a i P e n i n s u l a B o r o u g h ( B e a r C r e e k F i r e ) 2 0 1 3 O n e 9 7 , 4 2 0 9 5 , 6 2 0 9 3 , 8 2 0 9 7 , 0 2 0 9 4 , 5 2 0 9 7 , 5 2 0 9 5 , 3 2 0 9 3 , 1 2 0 9 5 , 9 2 0 92,920 Ci t y a n d B o r o u g h o f J u n e a u ( B a r t l e t t H o s p i t a l ) 2 0 1 3 O n e 1 , 6 5 2 , 1 1 3 1 , 6 5 7 , 2 1 3 1 , 6 5 9 , 2 6 3 1 , 6 6 5 , 5 6 3 1 , 6 6 1 , 8 6 3 1 , 6 6 1 , 5 1 3 1 , 6 6 6 , 7 1 3 1 , 6 6 5 , 3 1 3 1 , 6 6 7 , 5 1 3 1,668,263 Ci t y a n d B o r o u g h o f J u n e a u 2 0 1 3 O n e 2 0 1 , 0 1 0 2 0 2 , 4 1 0 2 0 3 , 6 1 0 1 9 9 , 6 1 0 2 0 4 , 6 1 0 2 0 0 , 2 1 0 2 0 0 , 8 1 0 2 0 1 , 2 1 0 2 0 1 , 4 1 0 200,160 Ke t c h i k a n G a t e w a y B o r o u g h 2 0 1 3 O n e 6 0 8 , 1 5 0 6 1 0 , 5 5 0 6 0 7 , 1 5 0 6 0 8 , 1 5 0 6 0 8 , 4 0 0 6 0 7 , 6 0 0 6 1 1 , 0 0 0 6 0 8 , 4 0 0 - - Ko d i a k I s l a n d B o r o u g h 2 0 1 3 O n e 1 , 6 9 0 , 1 4 0 1 , 6 8 9 , 7 4 0 1 , 6 8 8 , 1 4 0 1 , 6 9 0 , 3 4 0 1 , 6 8 7 , 5 9 0 1 , 6 9 1 , 7 9 0 1 , 6 8 9 , 3 9 0 1 , 6 9 0 , 5 9 0 1 , 6 9 0 , 1 9 0 1,687,690 Ci t y o f S a n d P o i n t 2 0 1 3 O n e 1 8 3 , 1 8 0 1 8 0 , 5 8 0 1 8 2 , 9 8 0 1 8 0 , 1 8 0 1 8 1 , 6 8 0 1 8 3 , 6 8 0 1 8 0 , 4 8 0 1 8 2 , 2 8 0 1 8 3 , 8 8 0 184,380 Ci t y a n d B o r o u g h o f S i t k a ( H a r b o r ) 2 0 1 3 O n e 3 1 0 , 3 0 0 3 0 9 , 7 0 0 3 0 8 , 9 0 0 3 0 7 , 9 0 0 3 1 0 , 1 5 0 3 0 8 , 5 5 0 3 1 1 , 7 5 0 3 0 9 , 5 5 0 3 1 2 , 1 5 0 307,400 Ci t y a n d B o r o u g h o f S i t k a ( E l e c t r i c ) 2 0 1 3 O n e 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1 , 7 5 7 , 3 6 0 1,757,360 Ci t y o f H o m e r 2 0 1 3 T w o 2 8 9 , 7 5 0 2 9 2 , 0 5 0 2 8 7 , 8 5 0 2 8 8 , 6 5 0 2 8 9 , 3 0 0 2 9 3 , 3 0 0 2 9 1 , 9 0 0 2 9 0 , 3 0 0 2 9 3 , 5 0 0 294,500 Ci t y o f K e t c h i k a n 2 0 1 3 T w o 1 , 0 6 4 , 4 0 0 1 , 0 6 9 , 5 0 0 1 , 0 6 9 , 2 0 0 1 , 0 6 8 , 4 5 0 1 , 0 7 2 , 2 5 0 1 , 0 6 9 , 8 5 0 1 , 0 7 1 , 6 5 0 1 , 0 7 2 , 4 5 0 1 , 0 7 7 , 2 5 0 1,079,250 Ko d i a k I s l a n d B o r o u g h 2 0 1 3 T w o 1 , 3 5 5 , 5 3 8 1 , 3 5 6 , 7 8 8 1 , 3 5 5 , 9 8 8 1 , 3 5 5 , 8 8 8 1 , 3 6 0 , 1 8 8 1 , 3 6 1 , 5 8 8 1 , 3 6 1 , 7 8 8 1 , 3 6 3 , 0 3 8 1 , 3 6 7 , 2 8 8 1,364,288 Mu n i c i p a l i t y o f S k a g w a y 2 0 1 3 T w o 6 6 , 9 5 0 7 1 , 3 5 0 7 0 , 3 0 0 6 9 , 2 5 0 6 8 , 2 0 0 7 1 , 8 0 0 7 0 , 2 0 0 6 8 , 6 0 0 7 2 , 0 0 0 69,750 Ci t y a n d B o r o u g h o f J u n e a u 2 0 1 3 T h r e e 9 0 2 , 3 2 5 9 0 2 , 4 7 5 9 0 3 , 6 5 0 9 0 5 , 4 5 0 9 0 3 , 6 5 0 9 0 2 , 1 2 5 9 0 2 , 0 0 0 9 0 5 , 0 0 0 9 0 2 , 0 0 0 - Ke n a i P e n i n s u l a B o r o u g h 1 , 6 2 8 , 7 2 5 1 , 6 2 7 , 3 0 0 1 , 6 2 6 , 5 5 0 1 , 6 2 5 , 5 5 0 1 , 6 2 6 , 6 0 0 1 , 6 2 7 , 3 2 5 1 , 6 2 8 , 5 0 0 1 , 6 2 7 , 6 7 5 1 , 6 3 0 , 1 7 5 1,630,175 La k e a n d P e n i n s u l a B o r o u g h 2 0 1 3 T h r e e 1 , 4 2 4 , 4 5 0 1 , 4 2 0 , 0 8 8 1 , 4 2 1 , 9 5 0 1 , 4 1 9 , 8 5 0 1 , 4 2 3 , 9 0 0 1 , 4 2 3 , 2 5 0 1 , 4 2 4 , 2 5 0 1 , 4 2 3 , 5 0 0 1 , 4 2 2 , 0 0 0 1,423,375 Ci t y a n d B o r o u g h o f S i t k a 2 0 1 3 T h r e e 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1 , 2 7 4 , 9 7 5 1,274,975 Ke n a i P e n i n s u l a B o r o u g h 2 0 1 4 O n e 2 , 9 5 8 , 0 5 6 2 , 9 5 6 , 2 8 0 2 , 9 5 6 , 6 7 0 2 , 9 6 0 , 0 6 7 2 , 9 6 0 , 0 6 2 2 , 9 5 9 , 1 0 3 2 , 9 5 5 , 8 4 9 2 , 9 5 7 , 5 0 0 2 , 9 5 5 , 5 0 0 2,958,250 Ko d i a k I s l a n d B o r o u g h 2 0 1 4 O n e 1 , 7 7 5 , 6 6 3 1 , 7 7 7 , 1 1 3 1 , 7 7 4 , 7 1 3 1 , 7 7 2 , 7 1 3 1 , 7 7 5 , 1 1 3 1 , 7 7 2 , 1 1 3 1 , 7 7 6 , 3 6 3 1 , 7 7 3 , 1 1 3 1 , 7 7 2 , 6 1 3 1,769,613 Ci t y a n d B o r o u g h o f J u n e a u 2 0 1 4 O n e 4 0 3 , 1 8 8 4 0 3 , 8 3 8 4 0 7 , 8 3 8 4 0 4 , 8 3 8 4 0 6 , 5 3 8 4 0 3 , 1 3 8 4 0 4 , 6 3 8 4 0 5 , 6 3 8 4 0 6 , 1 3 8 406,138 Ci t y o f K e t c h i k a n H o s p i t a l ( G . O . ) 2 0 1 4 T w o 1 , 7 5 3 , 7 0 0 1 , 7 5 3 , 7 0 0 2 , 5 5 3 , 7 0 0 2 , 5 5 3 , 7 0 0 2 , 5 5 1 , 7 0 0 2 , 5 5 2 , 7 0 0 2 , 5 5 6 , 4 5 0 2 , 5 5 7 , 7 0 0 2 , 5 5 6 , 4 5 0 2,557,700 (continued) Se e I n d e p e n d e n t A u d i t o r ' s r e p o r t -2 7 - Bo r r o w e r 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 2 0 2 0 2 1 2 0 2 2 2 0 2 3 2 0 2 4 2 0 2 5 AL A S K A M U N I C I P A L B O N D B A N K A U T H O R I T Y (A C o m p o n e n t U n i t o f t h e S t a t e o f A l a s k a ) Su p p l e m e n t a l S c h e d u l e 2 0 0 5 M a s t e r R e s o l u t i o n P r o g r a m - D e b t S e r v i c e R e q u i r e m e n t s Ju n e 3 0 , 2 0 1 5 Ci t y o f K e t c h i k a n H a r b o r ( G . O . ) 2 0 1 4 T w o 2 0 7 , 5 0 0 2 0 3 , 9 0 0 2 0 5 , 3 0 0 2 0 5 , 5 5 0 2 0 5 , 5 5 0 2 0 5 , 3 0 0 2 0 4 , 8 0 0 2 0 9 , 0 5 0 2 0 7 , 8 0 0 206,300 Ci t y o f K i n g C o v e E l e c t r i c 2 0 1 4 T w o 1 6 5 , 2 5 0 1 6 0 , 6 5 0 1 6 1 , 0 5 0 1 6 0 , 0 5 0 1 6 3 , 8 0 0 4 2 , 0 5 0 4 1 , 0 5 0 4 0 , 0 5 0 3 9 , 0 5 0 38,050 Ci t y a n d B o r o u g h o f J u n e a u 2 0 1 4 T h r e e 9 1 1 , 8 3 8 9 1 0 , 4 6 9 9 0 9 , 9 0 0 9 0 8 , 4 0 0 9 0 9 , 0 0 0 9 1 1 , 3 7 5 9 0 7 , 6 2 5 9 0 7 , 7 5 0 9 1 1 , 5 0 0 908,875 Ci t y a n d B o r o u g h o f S i t k a 2 0 1 4 T h r e e 8 1 6 , 2 5 0 8 1 6 , 2 5 0 8 1 6 , 2 5 0 8 1 6 , 2 5 0 8 1 6 , 2 5 0 8 1 6 , 2 5 0 8 1 6 , 2 5 0 8 1 6 , 2 5 0 8 1 6 , 2 5 0 816,250 Ci t y o f S a x m a n 2 0 1 4 T h r e e 1 2 , 7 6 3 1 2 , 6 8 1 1 2 , 5 5 0 1 2 , 3 5 0 1 2 , 1 2 5 1 1 , 8 7 5 1 1 , 6 2 5 1 1 , 3 7 5 1 6 , 0 0 0 15,500 Ci t y o f A d a k R e f u n d i n g 2 0 1 4 T h r e e 1 0 4 , 1 3 8 1 0 7 , 9 6 9 1 0 6 , 0 0 0 1 0 3 , 0 0 0 1 0 4 , 5 0 0 1 0 0 , 5 0 0 1 0 1 , 3 7 5 1 0 2 , 0 0 0 1 0 2 , 3 7 5 102,500 Mu n i c i p a l i t y o f A n c h o r a g e R e f u n d i n g 2 0 1 4 T h r e e 2 9 4 , 9 0 0 2 9 2 , 9 5 0 2 9 4 , 7 0 0 2 9 4 , 6 0 0 2 9 8 , 5 0 0 2 9 6 , 3 7 5 2 9 4 , 0 0 0 2 9 6 , 2 5 0 2 9 8 , 0 0 0 294,375 Ha i n e s B o r o u g h R e f u n d i n g 2 0 1 4 T h r e e 4 2 6 , 6 8 8 1 , 1 9 6 , 8 4 4 1 , 1 9 6 , 1 0 0 1 , 1 9 8 , 6 0 0 1 , 1 9 5 , 3 7 5 1 , 1 9 1 , 1 2 5 1 , 1 9 4 , 6 2 5 1 , 1 9 0 , 7 5 0 1 , 1 8 9 , 5 0 0 1,190,625 Ke n a i P e n i n s u l a B o r o u g h R e f u n d i n g 2 0 1 4 T h r e e 6 4 , 4 8 8 1 7 8 , 7 6 9 1 8 0 , 6 5 0 1 8 0 , 7 5 0 1 8 0 , 0 0 0 1 8 3 , 2 5 0 1 8 1 , 1 2 5 1 7 8 , 7 5 0 1 8 1 , 0 0 0 177,875 Ci t y o f N o m e R e f u n d i n g 2 0 1 4 T h r e e 2 6 9 , 2 0 0 2 6 6 , 2 7 5 2 7 1 , 3 5 0 2 6 8 , 6 5 0 2 6 9 , 6 2 5 2 6 9 , 1 2 5 2 6 8 , 1 2 5 2 6 6 , 6 2 5 2 6 9 , 5 0 0 271,625 No r t h w e s t A r c t i c B o r o u g h R e f u n d i n g 2 0 1 4 T h r e e 1 5 9 , 8 2 5 4 4 8 , 0 1 3 4 4 5 , 3 0 0 4 4 8 , 2 0 0 4 4 8 , 8 7 5 4 4 7 , 2 5 0 4 4 9 , 7 5 0 4 4 6 , 3 7 5 4 4 7 , 1 2 5 442,000 Pe t e r s b u r g B o r o u g h R e f u n d i n g 2 0 1 4 T h r e e 1 4 3 , 1 0 0 4 0 1 , 4 7 5 3 9 9 , 5 5 0 3 9 8 , 7 5 0 4 0 1 , 0 0 0 4 0 1 , 1 2 5 4 0 0 , 5 0 0 3 9 9 , 1 2 5 4 0 1 , 8 7 5 398,750 Ci t y o f S e w a r d 2 0 0 5 R e f u n d i n g 2 0 1 4 T h r e e 3 7 , 6 1 3 1 0 2 , 2 0 6 1 0 5 , 4 0 0 1 0 7 , 5 0 0 1 0 4 , 1 2 5 1 0 5 , 2 5 0 1 0 6 , 1 2 5 1 0 6 , 7 5 0 1 0 7 , 1 2 5 102,375 Ci t y o f S e w a r d 2 0 0 6 R e f u n d i n g 2 0 1 4 T h r e e 1 1 8 , 1 0 0 1 1 8 , 1 0 0 3 2 3 , 9 0 0 3 2 0 , 4 0 0 3 2 0 , 4 7 5 3 1 8 , 9 7 5 3 1 6 , 9 7 5 3 1 9 , 3 5 0 3 2 0 , 9 7 5 321,850 Ci t y o f C o r d o v a 2 0 1 5 O n e N e w M o n e y 1 3 5 , 8 2 1 1 3 6 , 3 2 5 1 3 4 , 2 2 5 1 3 6 , 7 2 5 1 3 4 , 1 2 5 1 3 6 , 0 7 5 1 3 2 , 5 7 5 1 3 3 , 9 5 0 1 3 5 , 0 7 5 135,950 Ci t y o f C o r d o v a 2 0 1 5 O n e 2 0 0 5 R e f u n d i n g 1 9 4 , 5 6 9 1 8 9 , 2 7 5 1 9 3 , 3 0 0 1 9 1 , 2 0 0 1 9 3 , 8 0 0 - - - - - Ci t y o f C o r d o v a 2 0 1 5 O n e 2 0 0 9 R e f u n d i n g 5 3 7 , 9 4 6 5 6 7 , 3 0 0 5 6 4 , 8 5 0 5 6 6 , 9 5 0 5 9 3 , 3 5 0 1 , 3 5 4 , 0 0 0 1 , 3 4 8 , 5 0 0 1 , 3 4 5 , 8 7 5 1 , 3 4 5 , 8 7 5 1,343,375 Ci t y o f C r a i g 2 0 1 5 O n e N e w M o n e y 1 3 5 , 9 9 0 1 3 6 , 4 8 8 1 3 4 , 3 8 8 1 3 6 , 8 8 8 1 3 4 , 2 8 8 1 3 6 , 2 3 8 1 3 2 , 7 3 8 1 3 4 , 1 1 3 1 3 5 , 2 3 8 136,113 Al e u t i a n s E a s t B o r o u g h 2 0 1 5 O n e 2 0 0 6 R e f u n d i n g 4 2 4 , 4 2 3 3 2 8 , 8 5 0 2 7 6 , 0 0 0 2 5 3 , 1 0 0 2 5 0 , 4 0 0 2 5 1 , 3 7 5 2 5 5 , 7 5 0 2 6 9 , 1 2 5 1 6 9 , 1 2 5 117,500 Ke t c h i k a n G a t e w a y B o r o u g h 2 0 1 5 O n e 2 0 0 5 R e f u n d i n g 5 8 9 , 2 8 8 5 8 3 , 3 5 0 5 9 4 , 2 0 0 5 8 6 , 5 0 0 - - - - - - Ke t c h i k a n 2 0 1 5 O n e 2 0 0 5 R e f u n d i n g 8 0 4 , 1 2 8 7 9 7 , 7 2 5 8 0 0 , 7 0 0 - - - - - - - No m e 2 0 1 5 O n e 2 0 0 6 R e f u n d i n g 8 8 , 6 2 9 8 5 , 9 7 5 8 8 , 9 5 0 9 1 , 4 5 0 8 3 , 9 5 0 8 6 , 1 2 5 8 7 , 7 5 0 8 9 , 1 2 5 9 0 , 2 5 0 86,250 No m e 2 0 1 5 O n e 2 0 0 9 R e f u n d i n g 2 0 , 4 6 6 1 9 , 7 0 0 1 9 , 7 0 0 1 9 , 7 0 0 4 9 , 1 0 0 5 2 , 6 2 5 5 0 , 8 7 5 4 9 , 1 2 5 5 2 , 2 5 0 50,250 No r t h w e s t A r c t i c B o r o u g h 2 0 1 5 O n e 2 0 0 5 R e f u n d i n g 1 , 6 3 7 , 3 0 7 1 , 6 3 6 , 2 0 0 1 , 6 3 7 , 6 0 0 1 , 6 3 5 , 1 0 0 1 , 6 3 0 , 4 0 0 1 , 6 4 0 , 0 0 0 - - - - Si t k a 2 0 1 5 O n e 2 0 0 5 R e f u n d i n g 3 9 6 , 2 6 9 4 0 0 , 2 5 0 3 9 7 , 8 0 0 3 9 8 , 1 0 0 3 9 7 , 8 0 0 - - - - - Si t k a 2 0 1 5 O n e 2 0 0 8 R e f u n d i n g 2 0 3 , 9 0 8 1 9 6 , 2 7 5 1 9 6 , 2 7 5 5 3 9 , 2 7 5 5 3 5 , 0 7 5 5 3 3 , 5 0 0 5 3 9 , 1 2 5 5 3 8 , 6 2 5 5 3 7 , 6 8 8 536,000 Un a l a s k a 2 0 1 5 O n e 2 0 0 5 R e f u n d i n g 3 9 5 , 9 0 5 3 9 4 , 9 7 5 3 9 7 , 6 0 0 3 9 7 , 9 0 0 3 9 2 , 7 0 0 - - - - - Un a l a s k a 2 0 1 5 O n e 2 0 0 9 R e f u n d i n g 8 4 7 , 6 2 9 8 1 5 , 9 0 0 8 1 5 , 9 0 0 8 1 5 , 9 0 0 1 , 8 5 2 , 4 3 8 1 , 8 5 3 , 1 2 5 1 , 8 4 9 , 8 4 4 1 , 8 4 8 , 9 9 4 1 , 8 4 6 , 1 3 8 1,841,825 Wr a n g e l l 2 0 1 5 O n e 2 0 0 6 R e f u n d i n g 2 4 2 , 5 0 1 2 4 5 , 6 2 5 2 3 8 , 4 5 0 2 4 0 , 0 5 0 2 4 1 , 2 5 0 2 4 0 , 8 7 5 - - - - Co r d o v a 2 0 1 5 T w o 1 7 9 , 7 0 5 2 0 9 , 1 5 0 2 1 1 , 4 5 0 2 1 2 , 6 5 0 2 1 2 , 6 5 0 2 1 2 , 4 0 0 2 1 1 , 9 0 0 2 1 1 , 1 5 0 2 1 3 , 7 5 0 212,500 Sk a g w a y 2 0 1 5 T w o 6 8 0 , 5 2 4 6 8 4 , 7 0 0 6 8 3 , 5 5 0 6 8 0 , 1 5 0 6 8 4 , 4 0 0 6 8 2 , 9 0 0 6 8 0 , 9 0 0 6 8 3 , 4 0 0 6 8 3 , 1 0 0 684,600 Ci t y a n d B o r o u g h o f J u n e a u 2 0 1 5 T w o ( G . O . R e f u n d i n g ) 7 0 4 , 2 6 0 6 9 8 , 0 5 0 7 0 5 , 3 5 0 7 0 5 , 7 5 0 7 0 8 , 7 5 0 - - - - - Ci t y a n d B o r o u g h o f J u n e a u 2 0 1 5 T w o ( H a r b o r R e f u n d i n g ) 2 6 8 , 5 5 8 3 6 2 , 1 0 0 3 6 2 , 1 0 0 7 4 2 , 1 0 0 7 3 8 , 1 0 0 7 3 8 , 3 5 0 7 3 7 , 6 0 0 7 4 0 , 8 5 0 7 4 1 , 6 5 0 743,150 Ke n a i P e n i n s u l a B o r o u g h 2 0 1 5 T w o 4 0 4 , 8 5 6 4 0 7 , 2 0 0 4 0 2 , 0 5 0 1 , 0 9 7 , 0 5 0 1 , 0 9 7 , 3 0 0 1 , 0 9 0 , 8 0 0 1 , 0 9 2 , 8 0 0 1 , 0 9 2 , 8 0 0 1 , 0 9 1 , 0 0 0 1,093,250 Ju n e a u 2 0 1 5 T w o ( C r u i s e D o c k ) 1 , 6 9 0 , 8 6 9 1 , 6 8 9 , 4 0 0 1 , 6 8 7 , 5 0 0 1 , 6 9 2 , 5 0 0 1 , 6 8 8 , 2 5 0 1 , 6 9 2 , 2 5 0 1 , 6 8 9 , 0 0 0 1 , 6 8 8 , 7 5 0 1 , 6 8 6 , 2 5 0 1,686,500 Sk a g w a y 2 0 1 5 T w o ( P o r t ) 3 6 2 , 1 1 3 3 6 2 , 7 3 8 3 6 3 , 0 8 8 3 6 1 , 6 8 8 3 6 3 , 4 3 8 3 5 9 , 6 8 8 3 6 0 , 6 8 8 3 6 1 , 1 8 8 3 6 1 , 1 8 8 360,688 To t a l L o a n O b l i g a t i o n D e b t S e r v i c e 9 2 , 5 1 5 , 0 5 7 $ 9 3 , 2 5 5 , 9 6 9 $ 9 1 , 5 6 7 , 2 9 3 $ 9 0 , 7 0 3 , 5 9 2 $ 8 5 , 6 7 1 , 6 7 2 $ 8 1 , 9 5 6 , 3 9 4 $ 7 7 , 1 1 0 , 3 1 5 $ 7 6 , 7 7 5 , 8 9 6 $ 7 2 , 1 8 6 , 9 0 1 $ 63,075,684$ Se e I n d e p e n d e n t A u d i t o r ' s r e p o r t -2 8 - OutstandingPercent of BorrowerParOutstanding Ketchikan Gateway Borough4,295,000$ 100.00% Total Outstanding Par4,295,000$ 100.00% ALASKA MUNICIPAL BOND BANK AUTHORITY (A Component Unit of the State of Alaska) Supplemental Schedule of 2010 Master Resolution Program - Community Concentration June 30, 2015 See Independent Auditor's report -29- Bo r r o w e r 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 2 0 2 0 2 1 2 0 2 2 2 0 2 3 2 0 2 4 2 0 2 5 Ke t c h i k a n G a t e w a y B o r o u g h 4 0 0 , 5 4 4 $ 4 0 0 , 5 4 4 $ 3 9 9 , 6 4 4 $ 4 0 3 , 4 4 4 $ 4 0 0 , 4 7 4 $ 3 9 5 , 7 9 1 $ 3 9 0 , 8 1 9 $ 3 8 5 , 5 5 8 $ 3 8 0 , 0 0 7 $ 374,168$ To t a l L o a n O b l i g a t i o n D S 40 0 , 5 4 4 $ 4 0 0 , 5 4 4 $ 3 9 9 , 6 4 4 $ 4 0 3 , 4 4 4 $ 4 0 0 , 4 7 4 $ 3 9 5 , 7 9 1 $ 3 9 0 , 8 1 9 $ 3 8 5 , 5 5 8 $ 3 8 0 , 0 0 7 $ 374,168$ AL A S K A M U N I C I P A L B O N D B A N K A U T H O R I T Y (A C o m p o n e n t U n i t o f t h e S t a t e o f A l a s k a ) Su p p l e m e n t a l S c h e d u l e 2 0 1 0 M a s t e r R e s o l u t i o n P r o g r a m - D e b t S e r v i c e R e q u i r e m e n t s Ju n e 3 0 , 2 0 1 5 Se e I n d e p e n d e n t A u d i t o r ' s r e p o r t -3 0 - [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX F 2005 General Obligation Bond Resolution and the 2013 First Supplemental Resolution [THIS PAGE INTENTIONALLY LEFT BLANK] GENERAL OBLIGATION BOND RESOLUTION ALASKA MUNICIPAL BOND BANK Adopted July 13, 2005 TABLE OF CONTENTS ALAKSA MUNICPAL BOND BANK Table of Contents (Amended) Page 1 ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS Section 101 - Authority for This Resolution .................................................................................................. 1 Section 102 - Resolution Constitutes Contract ............................................................................................ 1 Section 103 - Definitions .............................................................................................................................. 1 ARTICLE II AUTHORIZATION AND ISSUANCE OF BONDS Section 201 - Authorization of Bonds and Interest Rate Exchange Agreements ...................................... 12 Section 202 - Issuance and Delivery of Bonds .......................................................................................... 12 Section 203 - Provisions for Issuance of Bonds ........................................................................................ 12 Section 204 - Provisions for Refunding Bonds .......................................................................................... 15 ARTICLE III GENERAL TERMS AND PROVISIONS OF BONDS Section 301 - Description of Bonds; Payment ........................................................................................... 16 Section 302 - Legends ............................................................................................................................... 17 Section 303 - Execution and Authentication .............................................................................................. 17 Section 304 - Interchangeability of Bonds ................................................................................................. 18 Section 305 - Negotiability, Transfer and Registry .................................................................................... 18 Section 306 - Regulations with Respect to Exchanges and Transfers ...................................................... 18 Section 307 - Bonds Mutilated, Destroyed, Stolen or Lost ........................................................................ 19 Section 308 - Preparation of Definitive Bonds; Temporary Bonds ............................................................ 20 Section 309 - Cancellation and Destruction of Bonds ............................................................................... 20 ARTICLE IV REDEMPTION OF BONDS Section 401 - Redemption Provisions ........................................................................................................ 20 Section 402 - Notice of Redemption .......................................................................................................... 21 Section 403 - Partially Redeemed Fully Registered Bonds ....................................................................... 22 ARTICLE V CUSTODY AND APPLICATION OF CERTAIN PROCEEDS OF BONDS Section 501 - Application of Certain Proceeds .......................................................................................... 23 Section 502 – Loans…………………… ..................................................................................................... 23 Section 503 - Retention and Inspection of Documents .............................................................................. 24 ARTICLE VI ESTABLISHMENT OF FUNDS AND ACCOUNTS AND APPLICATION THEREOF Section 601 - Pledge .................................................................................................................................. 24 Section 602 - Establishment of Funds and Accounts ................................................................................ 25 Section 603 - Reserve Fund ...................................................................................................................... 25 Section 604 - Interest Account, Principal Account and Redemption Account ........................................... 27 ALAKSA MUNICPAL BOND BANK Table of Contents (Amended) Page 2 Section 605 - Rebate Fund ........................................................................................................................ 29 Section 606 - Operating Fund .................................................................................................................... 30 Section 607 - Reduction of Required Debt Service Reserve ..................................................................... 30 Section 608 - Trustee's Maintenance of Records on Payment of Bonds .................................................. 30 Section 609 - Obtaining Credit Enhancements and Interest Rate Exchange Agreements ...................... 30 Section 610 - Creation of Additional Funds, Accounts and Subaccounts; Separate Credit Enhancement Funds; Pledge with Respect to Credit Enhancements and Interest Rate Exchange Agreements ........................................................................ 32 ARTICLE VII SECURITY FOR DEPOSITS AND INVESTMENT OF FUNDS Section 701 - Security for Deposits ............................................................................................................ 33 Section 702 - Investment of Funds and Accounts Held by the Trustee ..................................................... 33 Section 703 - Liability of Trustee for Investments ...................................................................................... 34 ARTICLE VIII THE TRUSTEE AND THE PAYING AGENTS Section 801 - Appointment and Acceptance of Duties of Trustee ............................................................. 34 Section 802 - Appointment and Acceptance of Duties of Paying Agents .................................................. 34 Section 803 - Responsibilities of Fiduciaries ............................................................................................. 34 Section 804 - Evidence on Which Fiduciaries May Act ............................................................................. 36 Section 805 - Compensation ...................................................................................................................... 37 Section 806 - Permitted Acts and Functions .............................................................................................. 37 Section 807 - Resignation of Trustee ......................................................................................................... 37 Section 808 - Removal of Trustee ............................................................................................................. 37 Section 809 - Appointment of Successor Trustee ..................................................................................... 38 Section 810 - Transfer of Rights and Property to Successor Trustee ....................................................... 38 Section 811 - Merger or Consolidation ...................................................................................................... 39 Section 812 - Resignation or Removal of the Paying Agents and Appointment of Successors ................ 39 Section 813 - Evidence of Signatures of Bondholders and Ownership of Bonds ...................................... 39 ARTICLE IX COVENANTS OF THE BANK Section 901 - Payment of Bonds ............................................................................................................... 40 Section 902 - Extension of Payment of Bonds ........................................................................................... 41 Section 903 - Offices for Servicing Bonds ................................................................................................. 41 Section 904 - Further Assurances ............................................................................................................. 41 Section 905- Power to Issue Bonds and Make Pledges ............................................................................ 41 Section 906 - General Covenants of the Bank........................................................................................... 42 Section 907 - Accounts and Reports ......................................................................................................... 43 Section 908 - Personnel and Servicing of Programs ................................................................................. 43 Section 909 - Waiver of Laws .................................................................................................................... 44 Section 910 - Fees and Charges ............................................................................................................... 44 Section 911 - Administration of Reserve Fund .......................................................................................... 44 Section 912 - Issuance of Additional Obligations ...................................................................................... 45 Section 913 - Loan Agreement Provisions ................................................................................................. 46 Section 914 - Modification of Loan Agreement Terms ............................................................................... 47 Section 915 - Sale of Municipal Bonds by Bank ........................................................................................ 48 Section 916 - Disposition of the Proceeds of Sale or Redemption of Municipal Bonds ............................ 48 Section 917 - Enforcement of Municipal Bonds ......................................................................................... 48 Section 918 - Continuing Disclosure; Bankruptcy ...................................................................................... 49 Section 919 - Tax Covenants ..................................................................................................................... 49 ALAKSA MUNICPAL BOND BANK Table of Contents (Amended) Page 3 ARTICLE X SERIES RESOLUTION AND SUPPLEMENTAL RESOLUTIONS Section 1001 - Modification and Amendment without Consent ................................................................. 49 Section 1002 - Supplemental Resolutions Effective with Consent of Bondholders ................................... 50 Section 1003 - General Provisions Relating to Series Resolutions and Supplemental Resolutions ......... 50 ARTICLE XI AMENDMENTS Section 1101 - Powers of Amendment ...................................................................................................... 51 Section 1102 - Consent of Bondholders .................................................................................................... 51 Section 1103 - Modifications by Unanimous Consent ............................................................................... 53 Section 1104 - Mailing and Publication ...................................................................................................... 53 Section 1105 - Exclusion of Bonds ............................................................................................................ 53 Section 1106 - Notation on Bonds ............................................................................................................. 53 ARTICLE XII DEFAULTS AND REMEDIES Section 1201 - Trustee to Exercise Powers of Statutory Trustee .............................................................. 54 Section 1202 - Events of Default ............................................................................................................... 54 Section 1203 - Remedies ........................................................................................................................... 55 Section 1204 - Priority of Payments After Default ..................................................................................... 56 Section 1205 - Termination of Proceedings ............................................................................................... 58 Section 1206 - Bondholders' Direction of Proceedings .............................................................................. 58 Section 1207 - Limitation on Rights of Bondholders .................................................................................. 58 Section 1208 - Possession of Bonds by Trustee Not Required ................................................................. 59 Section 1209 - Remedies Not Exclusive .................................................................................................... 59 Section 1210 - No Waiver of Default .......................................................................................................... 59 Section 1211 - Notice of Event of Default .................................................................................................. 59 ARTICLE XIII DEFEASANCE Section 1301 - Defeasance ........................................................................................................................ 60 ARTICLE XIV MISCELLANEOUS Section 1401 - Preservation and Inspection of Documents ....................................................................... 62 Section 1402 - Parties of Interest ............................................................................................................... 62 Section 1403 - No Recourse Under Resolution or on Bonds .................................................................... 62 Section 1404 - Severability ........................................................................................................................ 62 Section 1405 - Headings ............................................................................................................................ 62 Section 1406 - Conflict ............................................................................................................................... 62 Section 1407 - Governing Law ................................................................................................................... 63 Section 1408 - Effective Date………………… ........................................................................................... 63 F-1 GENERAL OBLIGATION BOND RESOLUTION A RESOLUTION CREATING AND ESTABLISHING AN ISSUE OF BONDS OF THE ALASKA MUNICIPAL BOND BANK; PROVIDING FOR THE ISSUANCE FROM TIME TO TIME OF SAID BONDS; PROVIDING FOR THE PAYMENT OF PRINCIPAL OF AND INTEREST ON SAID BONDS; AND PROVIDING FOR THE RIGHTS OF THE HOLDERS THEREOF. BE IT RESOLVED by the Board of Directors of the Alaska Municipal Bond Bank as follows: ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS Section 101 - Authority for This Resolution. This Resolution is adopted pursuant to the provisions of the Act. Section 102 - Resolution Constitutes Contract. In consideration of the purchase and acceptance of the Bonds by those who shall hold the same from time to time, the provisions of this Resolution shall be a part of the contract of the Bank with the Holders of Bonds and shall be deemed to be and shall constitute a contract between the Bank, the Trustee and the Holders from time to time of the Bonds. The pledge hereof and the provisions, covenants and agreements herein set forth to be performed by or on behalf of the Bank shall be for the benefit, protection and security of the Holders of any and all of such Bonds. Each Bond, Credit Enhancement facility, and Interest Rate Exchange Agreement, regardless of the time or times of its issue or maturity, shall be of equal rank without preference, priority or distinction over any other Bond, Credit Enhancement facility, or Interest Rate Exchange Agreement except as expressly provided in this Resolution. Section 103 - Definitions. The following terms shall, for all purposes of this Resolution, have the following meanings unless the context shall clearly indicate some other meaning: "Accountant's Certificate" shall mean a certificate signed by an independent certified public accountant or a firm of independent certified public accountants selected by the Bank. "Accreted Amount" shall mean, with respect to Capital Appreciation of Bonds of any Series and as of the date of calculation, the amount established pursuant to the Series Resolution authorizing such Capital Appreciation Bonds as the amount representing the initial public offering price, plus the accumulated and compounded principal and interest on such Bonds. "Act" shall mean the Alaska Municipal Bond Bank Authority Act, constituting Chapter 85, Title 44, of the Alaska Statutes, as amended to the date of adoption of this Resolution. "Administrative Expenses" shall mean the Bank's expenses of carrying out and administering its powers, duties and functions, as authorized by the Act, and shall include, without limiting the generality of the foregoing: administrative and operating expenses, legal, accounting and consultant's services and expenses, payments to pension, retirement, health and hospitalization funds, and any other ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 2 expenses required or permitted to be paid by the Bank under the provisions of the Act or this Resolution or otherwise. "Aggregate Debt Service" for any period shall mean, as of any date of calculation and with respect to all Bonds, the sum of the amounts of Debt Service for such period. "Annual Debt Service" shall mean the total amount of Debt Service for any Outstanding Bonds in any Fiscal Year. "Authorized Denominations" with respect to any Series of Bonds issued hereunder, has the meaning specified in the related Series Resolution. "Authorized Officer" shall mean the Chairman, Vice Chairman, Executive Secretary, or Executive Director of the Bank and any other director, officer or employee of the Bank authorized by resolution of the Bank to perform such act or discharge such debt. "Bank" shall mean the Alaska Municipal Bond Bank, a public body corporate and politic constituted as a public corporation and instrumentality of the State of Alaska within the Department of Revenue but having a legal existence independent of and separate from the State exercising public and essential governmental functions and created by the Act, or any body, agency or instrumentality of the State which shall hereafter succeed to the powers, duties and functions of the Bank. "Beneficial Owner" shall mean the person in whose name a Bond is recorded as the beneficial owner of such Bond by the respective systems of DTC and the DTC Participants or the Holder of the Bond if the Bond is not then held in book-entry form. "Bond" or "Bonds" shall mean any Alaska Municipal Bond Bank Bond or Bonds, or Alaska Municipal Bond Bank Authority Bond or Bonds, as the case may be, authenticated and delivered under this Resolution pursuant to a Series Resolution. "Bondholder" or "Holder" or words of similar import, when used with reference to a Bond or Bonds, shall mean any person who shall be the registered owner of any Outstanding Bond or Bonds issued in fully registered form or the bearer of any Bond or Bonds issued in bearer form or registered to bearer. When all Bonds of a Series are held by a securities depository, "Bondholder" or "Holder" shall mean the beneficial owner of the Series in question determined under the rules of that securities depository; otherwise "Bondholder" or "Holder" means owner of record on the bond register maintained by the Paying Agent. To the extent that the full payment of the interest on and principal of Bonds of a Series is secured by Credit Enhancement, the Credit Enhancement Agency shall be considered to be the "Bondholder" or "Holder" of all the Bonds of that Series for purposes of exercising any rights with respect to supplements and amendments to this Resolution if the Credit Enhancement Agreement so provides. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 3 "Bond Year" shall mean each one-year period that ends on an anniversary of the date of issue of the Bonds. "Book-Entry System" shall mean the system in which the Bonds (represented by one Bond certificate for each maturity of the Bonds) are delivered into the possession of DTC and are issued and fully-registered as to principal and interest in the name of Cede & Co., and whereby beneficial interests in the Bonds are purchased by investors through DTC Participants, such interests shown and transfers thereof effected only through the records maintained by the respective DTC Participants from whom each such investor acquired such beneficial interest. "Business Day" shall mean any day other than a Saturday or Sunday or any other day on which banks in New York, Alaska, or the state or states in which any Trustee appointed hereunder performs its duties hereunder are authorized or required to be closed or are closed. "Capital Appreciation Bonds" shall mean Bonds, the interest on which (a) is compounded and accumulated at the rates and on the dates set forth in the Series Resolution authorizing the issuance of such Bonds and designating them as Capital Appreciation Bonds, and (b) is payable upon maturity or redemption of such Bonds. "Continuing Disclosure Certificate" shall mean, for each Series, the continuing disclosure certificate executed by the Bank for the purpose of satisfying the continuing disclosure requirements of Rule 15c2-12 of the Securities and Exchange Commission with respect to such Series, as such continuing disclosure certificate is originally executed and as it may be amended from time to time in accordance with its terms. "Counsel's Opinion" shall mean an opinion signed by an attorney or firm of attorneys of nationally recognized standing in the field of law relating to state and municipal financing (who may be counsel to the Bank) selected by the Bank and acceptable to the Trustee. "Credit Enhancement" shall mean a letter of credit, a line of credit, a credit facility, a surety bond, bond insurance, or any other instrument or arrangement obtained in connection with the issuance of a Series of Bonds to further secure the payment of the Bonds of such Series or to satisfy the Reserve Fund Requirement. "Credit Enhancement Agency" shall mean any bank or other institution that provides Credit Enhancement. "Current Interest Bonds" shall mean Bonds not constituting Capital Appreciation Bonds. Interest on Current Interest Bonds shall be payable periodically on the Interest Payment Dates provided therefor in a Series Resolution. "Debt Service" shall mean for any Series of Bonds Outstanding, an amount equal to the sum of (a) all interest payable during such period of calculation, plus (b) the Principal Installments, if any, payable during such period of calculation on such Series of Bonds. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 4 "Executive Director" shall mean the Executive Director or Acting Executive Director of the Bank. "Fees and Charges" shall mean all fees and charges authorized to be charged by the Bank pursuant to section 44.85.080(8), (15) and (16) of the Act and charged by the Bank to Governmental Units pursuant to the terms and provisions of Loan Agreements. "Fiduciary" or "Fiduciaries" shall mean the Trustee, and Paying Agent, or any or all of them, as may be appropriate. "Fiscal Year" shall mean any twelve (12) consecutive calendar months commencing with the first day of July and ending on the last day of the following June or such other date as is authorized by statute and/or selected by the Bank. "Fitch" shall mean Fitch Ratings, organized and existing under the laws of the State of Delaware, its successors and their assigns, and, if such organization shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, "Fitch" shall be deemed to refer to any other nationally recognized securities rating agency (other than Standard & Poor's or Moody's) designated by the Authorized Officer. "Government Obligations" shall mean direct obligations of, or obligations of the payment of and interest on which are unconditionally guaranteed by, the United States of America. "Governmental Unit" shall mean a municipality or such other entity of which the Bank is authorized by law to purchase its revenue bonds, general obligation bonds, notes, or other forms of indebtedness and which otherwise satisfies conditions found herein and in the Loan Agreement. "Governmental Unit's Allocable Proportion" shall mean the proportionate amount of the total requirement in respect of which the term is used determined by the ratio that the Loan then outstanding to such Governmental Unit bears to the total of all Loans then outstanding to all Governmental Units. "Interest Account" shall mean the account by that name established by Section 602. "Interest Payment Date" shall mean any date upon which interest on any Bonds is payable in accordance with the terms thereof. "Interest Rate Exchange Agreement" shall mean an agreement entered into by the Bank or the Trustee, on behalf of the Bank, providing for an interest rate cap, floor or swap with respect to any Bonds or Municipal Bonds. "Investment Securities" shall mean the following to the extent permitted by the Act and the laws of the State of Alaska: (1) Governmental Obligations; (2) Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the F-2 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 5 following federal agencies and provided such obligations are backed by the full faith and credit of the United States of America (stripped securities are only permitted if they have been stripped by the agency itself); (a) Farmers Home Administration ("FmHA") Certificates of Ownership; (b) Federal Housing Administration ("FHA") Debentures; (c) General Services Administration Participation certificates; (d) Government National Mortgage Association ("GNMA" or "Ginnie Mae") GNMA-guaranteed mortgage- backed bonds or GNMA- guaranteed pass-through obligations (participation certificates); (e) United States Maritime Administration Guaranteed Title XI financing; (f) United States Department of Housing and Urban Development ("HUD") Project Notes Local Authority Bonds; (3) Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following government agencies (stripped securities are only permitted if they have been stripped by the agency itself); (a) Federal Home Loan Bank System. Senior debt obligations (Consolidated debt obligations); (b) Federal Home Loan Mortgage Corporation. ("FHLMC" or "Freddie Mac") rated AAA by Standard & Poor's and Aaa by Moody's Participation Certificates (Mortgage-backed securities) Senior debt obligations; (c) Federal National Mortgage Association. ("FNMA" or "Fannie Mae") rated AAA by Standard & Poor's and Aaa by Moody's Mortgage-backed securities and senior debt obligations (excluded are stripped mortgage securities which are valued greater than par on the portion of unpaid principal); (d) Student Loan Market Association. ("SLMA" or "Sallie Mae") Senior debt obligations; (e) Resolution Funding Corp. ("REFCORP") Only the interest component of ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 6 REFCORP strips which have been stripped by request of the Federal Reserve Bank of New York in book-entry form are acceptable; and (f) Farm Credit System. Consolidated systemwide bonds. (4) Money market funds registered under the Federal Investment Company Act of 1940, whose shares are registered under the Federal Securities Act of 1933, and having a rating by S&P of "AAAm-G," "AAAm" or "AAm" or by Moody's of "Aaa" including funds from which the Trustee or its affiliates receive fees for investment advisory or other services to such fund; (5) Certificates of Deposit ("CD") secured at all times by collateral described in (a) and/or (b) above. CD's must have a one-year or less maturity. Such certificates must be issued by commercial banks, savings and loan associations or mutual savings banks whose short-term obligations are rated "A-I+" or better by S&P, and "Prime-1" or better by Moody's. The collateral must be held by a third party and the third party must have a perfected first security interest in the collateral; (6) Certificates of deposit, savings accounts, deposit accounts or money market deposits which are fully insured by the Federal Deposit Insurance Corporation ("FDIC"), including Bank Insurance Fund ("BIF") and Savings Association Insurance Fund ("SAIF"); (7) Commercial paper rated "Prime-1" by Moody's and "A-1+" or better by S&P and which matures not more than 270 days after the date of purchase; (8) Bonds or notes issued by any state or municipality which are rated by Moody's and S&P in the highest long-term rating category assigned by such agencies; (9) Federal funds or bankers acceptances with a maximum term of one year of any bank which has an unsecured, uninsured and unguaranteed obligation rating of "Prime-1" by Moody's and "A-1+" by S&P; (10) Repurchase agreements providing for the transfer of securities from a dealer bank or securities firm (seller/borrower) to a municipal entity (buyer/lender), and the transfer of cash from a municipal entity to the dealer bank or securities firm with an agreement that the dealer bank or securities firm will repay the cash plus a yield to the municipal entity in exchange for the securities at a specified date; provided, however, that the repurchase agreement must satisfy certain criteria articulated in writing to the Bank by the ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 7 Rating Agencies and such agreement must be approved in writing prior to its acquisition by each bond insurer then insuring any Series of Bonds; and (11) Investment contracts with providers the long term, unsecured debt obligations of which are rated at least "Aaa" by the Rating Agencies. "Loan" shall mean a loan heretofore or hereafter made by the Bank to a Governmental Unit pursuant to the Act and more particularly described in the applicable Series Resolution. "Loan Agreement" shall mean an agreement, and any amendments thereto, heretofore or hereafter entered into between the Bank and a Governmental Unit setting forth the terms and conditions of a Loan. "Loan Obligation" shall mean that amount of Bonds and the Bonds themselves issued by the Bank for the purchase of Municipal Bonds of a Governmental Unit. "Maximum Annual Debt Service" shall mean, with respect to any Outstanding Series of Bonds, the highest remaining Annual Debt Service for such Series of Bonds. "Moody's" shall mean Moody's Investors Service, Inc., a corporation duly organized and existing under and by virtue of the laws of the State of Delaware, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term "Moody's" shall be deemed to refer to any other nationally recognized securities rating agency (other than Fitch or Standard & Poor's) designated by the Authorized Officer. "Municipal Bonds" shall mean general obligation bonds, revenue bonds, notes or other evidences of debt issued by any Governmental Unit as now or hereafter defined in the Act which have heretofore been or will hereafter be acquired by the Bank as evidence of a Loan to the Governmental Unit pursuant to the Act. "Municipal Bonds Interest Payment" shall mean that portion of a Municipal Bonds Payment made or required to be made by a Governmental Unit to the Bank which represents the interest due or to become due on the Governmental Unit's Municipal Bonds. "Municipal Bonds Payment" shall mean the amounts paid or required to be paid, from time to time, for principal and interest by a Governmental Unit to the Bank on the Governmental Unit's Municipal Bonds. "Municipal Bonds Principal Payment" shall mean that portion of a Municipal Bonds Payment made or required to be made by a Governmental Unit to the Bank which represents the principal due or to become due on the Governmental Unit's Municipal Bonds. "Notes" shall mean any obligations referred to herein issued by the Bank other than Bonds. "Operating Fund" shall mean the fund by that name established by Section 602. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 8 "Outstanding" when used with reference to Bonds, other than Bonds referred to in Section 1105 hereof, shall mean, as of any date, all Bonds theretofore or thereupon being authenticated and delivered under this Resolution except: (1) Any Bonds canceled by the Bank or the Trustee at or prior to such date; (2) Bonds for the transfer or exchange of or in lieu of or in substitution for which other Bonds shall have been authenticated and delivered pursuant to this Resolution; and (3) Bonds deemed to have been paid as provided in subsection (B) of Section 1301. "Paying Agent" for the Bonds of any Series shall mean the bank or trust company and its successor or successors, which may include the Trustee, designated by the Bank as Paying Agent pursuant to the provisions of this Resolution and a Series Resolution or any other resolution of the Bank adopted prior to authentication and delivery of Bonds for which such Paying Agent or Paying Agents shall be so appointed. "Principal Account" shall mean the account by that name established by Section 602. "Principal Installment" shall mean, as of any date of calculation and with respect to the Outstanding Bonds of any Series, (i) the principal amount of such Bonds which are due on a certain future date, reduced by the aggregate principal amount of such Bonds which would be retired by reason of the payment when due and application in accordance with this Resolution of Sinking Fund Payments payable before such future date for the retirement of such Bonds or (ii) the unsatisfied balance of any Sinking Fund Payment due on a certain future date for such Bonds, plus the aggregate amount of the premiums, if any, which would be applicable on such future date upon the redemption of such Bonds by application of such Sinking Fund Payments in a principal amount equal to said unsatisfied balance or (iii) if such future dates coincide as to different Bonds of such Series, the sum of such principal amount of Bonds, unsatisfied balance and applicable premiums, if any or (iv) for any particular Series of Bonds the amount specified in the Supplemental Resolution authorizing such Series of Bonds. "Put Bond" shall mean any Bond that is part of a Series of Bonds subject to mandatory purchase by the Bank, its agent or a third party from the Owner of the Bond pursuant to provisions of the Series Resolution authorizing the issuance of the Bond. "Rating Agencies" shall mean Moody's, Standard & Poor's and Fitch or their respective successors and assigns and/or such other securities rating agency selected by the Bank to provide a rating with respect to a Series of Bonds, or any portion thereof, which Rating Agency, as of the applicable date, shall have F-3 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 9 assigned a rating to any Series of Bonds or any portion thereof. "Rebate Calculation Date" shall mean, with respect to each Series of Bonds, the interest payment date next preceding the fifth anniversary of the issue date of such Series of Bonds, each fifth anniversary of the initial Rebate Calculation Date for such Series of Bonds, and the date of retirement of the last bond for such Series. "Rebate Fund" shall mean the fund by that name established by Section 602. "Rebate Requirement" shall mean the amount of arbitrage profits earned from the investment of gross proceeds of the Bonds in nonpurpose investments described in Section 148(f)(2) of the Code and defined as "Rebate Amount" in Section 1.148-3 of the Treasury Regulations, which are payable to the United States at the times and in the amounts specified in Section 148(D)(3) of the Code and Section 1.148-3 of the Treasury Regulations. "Record Date" shall have the meaning set forth in the Series Resolution authorizing the particular Series of Bonds. "Redemption Account" shall mean the account by that name established by Section 602. "Redemption Price" shall mean, with respect to any Bond, the principal amount thereof, plus the applicable premium, of any, payable upon redemption thereof pursuant to the provisions of such Bond, this Resolution and the Series Resolution pursuant to which the same was issued. "Refunding Bonds" shall mean all Bonds, whether issued in one or more series, authenticated and delivered on original issuance for the purpose of refunding Bonds or other obligations of the Bank and all Bonds thereafter authenticated and delivered upon the transfer or exchange of or in lieu of or in substitution for such Bond pursuant to this Resolution. "Regular Record Date" shall mean, unless otherwise provided in a Series Resolution, with respect to the Bonds, the fifteenth (15th) day immediately preceding each Interest Payment Date (or the Business Day immediately preceding such fifteenth (15th) day, if such fifteenth (15th) day is not a Business Day). "Required Debt Service Reserve" shall mean as of any date of calculation, the amount required to be on deposit in the Reserve Fund which amount shall be at least equal to the Reserve Fund Requirement. "Reserve Fund" shall mean the 2005 General Obligation Bond Resolution Reserve Account established by Section 602 within the Alaska Municipal Bond Bank Reserve Fund created by Section 44.85.270 of the Act. "Reserve Fund Obligations" shall mean the amount of Bonds issued by the Bank to obtain funds deposited in the Reserve Fund. "Reserve Fund Requirement" shall mean the least of (i) Maximum Annual Debt ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 10 Service with respect to all Bonds Outstanding; (ii) 125% of Average Annual Debt Service with respect to all Bonds Outstanding; (iii) 10% of the initial principal amount of each Series of Bonds then Outstanding, or (iv) such lower amount as may be required by law. The Reserve Fund Requirement may be satisfied entirely, or in part, by Credit Enhancement as provided for herein; provided, however, any Credit Enhancement satisfying all or any part of the Reserve Fund Requirement after the initial issuance of Bonds or issued in substitution for any prior Credit Enhancement previously issued shall not, by itself, cause a withdrawal or a downward revision of the ratings maintained by any Rating Agency with respect to the Bonds. "Resolution" shall mean this General Obligation Bond Resolution as from time to time amended or supplemented by Supplemental Resolutions or Series Resolutions in accordance with the terms and provisions hereof. "Security Instrument" shall mean an instrument or other device issued by a Security Instrument Issuer to pay, or to provide security or liquidity for, a Series of Bonds. The term "Security Instrument" includes, by way of example and not of limitation, letters of credit, bond insurance policies, standby bond purchase agreements, lines of credit and other security instruments and credit enhancement or liquidity devices; provided, however, that no such device or instrument shall be a "Security Instrument" for purposes of this Resolution unless specifically so designated in a Series Resolution authorizing the use of such device or instrument. "Security Instrument Agreement" shall mean any agreement entered into by the Bank and a Security Instrument Issuer pursuant to a Series Resolution and/or the applicable portions of a Series Resolution providing for the issuance by such Security Instrument Issuer of a Security Instrument. "Security Instrument Costs" shall mean, with respect to any Security Instrument, all fees, premiums, expenses and similar costs, other than Security Instrument Repayment Obligations, required to be paid to a Security Instrument Issuer pursuant to a Security Instrument Agreement or the Series Resolution authorizing the use of such Security Instrument. Such Security Instrument Agreement or Series Resolution shall specify any fees, premiums, expenses and costs constituting Security Instrument Costs. "Security Instrument Issuer" shall mean any bank or other financial institution, insurance company, surety company or other institution issuing a Security Instrument. "Security Instrument Repayment Obligations" shall mean, as of any date of calculation and with respect to any Security Instrument Agreement, any outstanding amounts payable by the Bank under the Security Instrument Agreement or the Series Resolution authorizing the use of such Security Instrument to repay the Security Instrument Issuer for payments previously or concurrently made by the Security Instrument Issuer pursuant to a Security Instrument. There shall not be included in the calculation of the amount of Security ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 11 Instrument Repayment Obligations any Security Instrument Costs. Each Security Instrument Agreement or the Series Resolution authorizing the use of such Security Instrument shall specify any amounts payable under it which, when outstanding, shall constitute Security Instrument Repayment Obligations and shall specify the portions of any such amounts that are allocable as principal of and as interest on such Security Instrument Repayment Obligations. "Series of Bonds" or "Bonds of a Series" or words of similar meaning shall mean the Series of Bonds authorized by a Series Resolution. "Series Resolution" shall mean a resolution of the Bank authorizing the issuance of a Series of Bonds in accordance with the terms and provisions hereof and adopted in accordance with Article X. "Sinking Fund Installment" shall mean, as of any particular date of calculation and with respect to the Outstanding Bonds of any Series, the amount required to be paid at all events by the Bank on a single future date for the retirement of Bonds of such Series which mature after said future date, but does not include any amount payable by the Bank by reason only of the maturity of a Bond. "Standard & Poor's" shall mean Standard & Poor's Ratings Services, a Division of The McGraw-Hill Companies, Inc., and its successors and assigns, except that if such corporation or division shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term "Standard & Poor's" shall be deemed to refer to any other nationally recognized securities rating agency (other than Moody's or Fitch) designated by the Authorized Officer. "State" shall mean the State of Alaska. "Supplemental Resolution" shall mean a resolution supplemental to or amendatory of this Resolution, (other than a Series Resolution) adopted by the Bank in accordance with Article X. "Trustee" shall mean the bank or trust company appointed pursuant to Section 801 to act as trustee hereunder, and its successor or successors and any other bank or trust company at any time substituted in its place pursuant to this Resolution. "Variable Rate Bonds" shall mean, as of any date of calculation, Bonds the terms of which on such date of calculation are such that interest thereon for any future period of time is expressed to be calculated at a rate which is not susceptible to a precise determination. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Unless the context shall otherwise indicate, words importing the singular number shall include the plural number and vice versa, and words importing persons shall include corporations and associations, including public bodies, as well as natural persons. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 12 The terms "hereby," "hereof," "hereto," "herein," "hereunder," and any similar terms, as used in this Resolution, refer to this Resolution. ARTICLE II AUTHORIZATION AND ISSUANCE OF BONDS Section 201 - Authorization of Bonds and Interest Rate Exchange Agreements. (A) Bonds are hereby authorized for issuance hereunder by the Bank. The Bonds may be issued in one or more Series pursuant to one or more Series Resolutions which shall state the purpose or purposes for which each Series of Bonds is being issued as hereinafter provided without limitation as to amount except as provided in this Resolution or as may be limited by law. Interest Rate Exchange Agreements may only be executed and delivered by the Bank in connection with the issuance and delivery of a Series of Bonds hereunder or in connection with the renewal, substitution or extension of an Interest Rate Exchange Agreement. (B) There is hereby created by this Resolution, in the manner and to the extent provided herein, a continuing pledge and lien to secure the full and final payment of the principal or Redemption Price of, interest on and Sinking Fund Installments for, all of the Bonds issued pursuant to this Resolution. The Bonds shall be general obligations of the Bank payable as to principal or Redemption Price of, interest on, and Sinking Fund Installments for the Bonds solely from the sources provided in this Resolution and any Series Resolution. The State shall not be liable on the Bonds and the Bonds shall not be a debt or liability, or constitute a pledge or loan of the faith and credit, of the State. The Bonds shall contain on the face thereof a statement to the effect that the Bank is obligated to pay the principal or Redemption Price, if any, of the Bonds and the interest thereon only from revenues or funds of the Bank and that the State is not obligated to pay such principal or Redemption Price, if any, or interest and that neither the faith and credit nor the taxing power of the State is pledged to the payment of the principal or Redemption Price, if any, of, or the interest on, the Bonds. Section 202 - Issuance and Delivery of Bonds. After their authorization by a Series Resolution, Bonds of a Series may be executed by or on behalf of the Bank and delivered to the Trustee for authentication and, upon compliance by the Bank with the requirements, if any, set forth in such Series Resolution and with the requirements of Section 203 or, in the case of Refunding Bonds, Section 204, the Trustee shall thereupon authenticate and deliver such Bonds to or upon the order of the Bank. Section 203 - Provisions for Issuance of Bonds. (A) The issuance of the Bonds shall be authorized by a Series Resolution or Series Resolutions of the Bank adopted subsequent hereto and the Bonds may be issued in one or more Series. The Bonds of each Series, including Refunding Bonds, shall, in addition to the title "Alaska Municipal Bond Bank General Obligation Bonds," contain such further appropriate particular designations added to such title and the appropriate Series designation F-4 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 13 as the Bank may determine in such Series Resolution. Each Bond shall bear upon its face the designations so determined for the Series to which it belongs. (B) Each Series Resolution authorizing the issuance of a Series of Bonds shall specify: (1) The authorized principal amount of said Series of Bonds; (2) The purposes for which such Series of Bonds is being issued, which shall be one or more of the following: (i) making Loans to Governmental Units, (ii) making payments into the Reserve Fund, (iii) the funding of Notes theretofore issued by the Bank for any purposes for which Bonds may have been issued, (iv) the refunding of Bonds and related purposes, as provided in Section 204, and (v) any other purpose authorized by law; (3) The date and the maturity date or dates and amounts of each maturity of the Bonds of said Series or the method of determining the same; (4) (i) The interest rate or rates (if any) or maximum interest rate of the Bonds of such Series, or the method of determining such rate or rates (which may be determinable at one or more specified times set forth in the Series Resolution, which may accrete or compound with such frequencies or in such manner as shall be specified in such Series Resolution and which shall be as otherwise specified in the Series Resolution), and the Interest Payment Dates and Record Dates therefor and (ii) a manner of calculating accreted value or compounded principal value during all or any part of the term of the Series of Bonds being authorized, if interest is not payable currently and the Bank determines that it is necessary or appropriate; (5) The denomination or denominations of, and the manner of numbering and lettering, the Bonds of such Series, provided that each Bond shall be of the denomination of $5,000 or a multiple thereof, not exceeding the aggregate principal amount of the Bonds of such Series maturing in the year of maturity of the Bond for which the denomination is to be specified unless otherwise provided in the Series Resolution authorizing the issuance of such Bonds; (6) The Paying Agent or Paying Agents and the place or places of payment of the principal and Redemption Price, if any, of and interest on the Bonds of such Series or the manner of appointing and designating the same; (7) The Redemption Price or Prices, if any, and, subject to the provisions of Article IV, the redemption terms for the Bonds of such Series or the method of determining the same; (8) The amount and due date of each Sinking Fund Installment, if any, for Bonds of like maturity of such Series, or the method of determining such Sinking Fund Installment; (9) The form or forms of the Bonds of such Series and of the Trustee's certificate of authentication; (10) The manner of execution of the Bonds of such Series; ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 14 (11) If, at the time of issuance of the Bonds of such Series, an Interest Rate Exchange Agreement will apply to such Bonds or such Bonds are to be secured by Credit Enhancement, the form of Credit Enhancement or Interest Rate Exchange Agreement to be obtained, the identity of the Credit Enhancement Agency or of the counterparty to the Interest Rate Exchange Agreement, and the substantial form of the significant documents relating to the Credit Enhancement or Interest Rate Exchange Agreement; (12) If Bonds of such Series are to contain any tender or put options or the like, whether such Bonds are to be remarketed and, if so, the identity of any remarketing agent and the substantial form of any remarketing agreement relating to such Bonds; and (13) Any other provisions deemed advisable by the Bank, not in conflict with the provisions of this Resolution. All Bonds of each Series of like maturity shall be identical in all respects, except as to denominations, interest rate, and numbers and letters. (C) All (but not less than all) the Bonds of each Series shall be executed by the Bank for issuance under the Resolution and delivered to the Trustee and thereupon shall be authenticated by the Trustee and by it delivered to the Bank or to such other party as may be specified in a written order of the Bank, but only upon the receipt by the Trustee of: (1) A Counsel's Opinion to the effect that (i) the Bank has the right and power to execute and deliver this Resolution and the Series Resolution authorizing such Series under the Act as amended to the date of such Opinion; (ii) this Resolution and such Series Resolution has been duly and lawfully executed and delivered by the Bank, is in full force and effect and is valid and binding upon the Bank and enforceable in accordance with its terms (subject, as to enforcement of remedies, to applicable bankruptcy, reorganization, insolvency, moratorium, or other laws affecting creditors' rights generally from time to time in effect); (iii) this Resolution and such Series Resolution creates the valid pledge and assignment which it purports to create of the Municipal Bonds, subject to the application thereof to the purposes and on the conditions permitted by this Resolution; (iv) the Bonds of such Series are valid and binding general obligations of the Bank, enforceable in accordance with their terms and the terms of this Resolution and such Series Resolution; and (v) the Bonds of such Series have been duly and validly authorized and issued in accordance with the constitution and statutes of the State, including the Act as amended to the date of such Opinion, and in accordance with this Resolution; (2) A written order as to the delivery of such Bonds, signed by an Authorized Officer; (3) Either an original of the Series Resolution authorizing such Series or a copy thereof certified by an Authorized Officer; ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 15 (4) Except in the case of Refunding Bonds, a certificate of an Authorized Officer stating that the Bank is not in default in the performance of any of the covenants, conditions, agreements or provisions contained in the Resolution; (5) Such further documents, moneys and securities as are required by the provisions of this Section 203, and Section 204, or Article X, or any Series Resolution or Supplemental Resolution adopted pursuant to Article X. Section 204 - Provisions for Refunding Bonds. (A) All or any part of one or more Series of Refunding Bonds may be authenticated and delivered to refund all Outstanding Bonds or any part of one or more Series of Outstanding Bonds. Refunding Bonds shall be issued in a principal amount sufficient, together with other moneys available therefor, to accomplish such refunding and to make such deposits as are required by the provisions of the Act, this Section and of the Series Resolution authorizing said Series of Refunding Bonds. (B) A Series of Refunding Bonds may be authenticated and delivered only upon receipt by the Trustee (in addition to the receipt by it of the documents required by Section 203) of: (1) Instructions to the Trustee to give due notice of redemption (which notice, in the case of an optional redemption, shall state that the redemption is conditioned by the Trustee on the receipt of sufficient funds for redemption) of all the Bonds to be refunded on the redemption date specified in such instructions; (2) Either (i) moneys (which may include all or a portion of the proceeds of the Refunding Bonds to be issued) in an amount sufficient to effect payment at the applicable Redemption Price of the Bonds or other obligations to be refunded, together with accrued interest on such Bonds or other obligations to the redemption date, or (ii) direct obligations of (including obligations issued or held in book-entry form on the books of) the Department of the Treasury of the United States of America which are not subject to redemption prior to the dates on which amounts will be needed to make payments on the Bonds or other obligations to be refunded and the principal of and interest on which when due, together with the moneys (which may include all or a portion of the proceeds of the Refunding Bonds to be issued), if any, contemporaneously deposited with the Trustee, will be sufficient to pay when due the applicable Redemption Price of the Bonds or other obligations to be refunded, together with accrued interest on such Bonds or other obligations to the redemption date, which moneys or Investment Securities shall be held by the Trustee or any one or more of the Paying Agents or an escrow agent or trustee for other obligations in a separate account irrevocably in trust for and assigned to the respective Holders of the Bonds or other obligations to be refunded; and (3) A certificate of an Authorized Officer containing such additional statements as may be reasonably necessary to show compliance with the requirements of subsection (A) and this subsection (B) of this Section 204. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 16 (C) From and after the delivery of the Refunding Bonds of a Series, the Trustee shall make appropriate adjustment between the Interest Account and Principal Account when disbursing and applying Municipal Bonds Payments deposited in the Debt Service Fund pursuant to the provisions of Section 604 to the end that such portion of the Municipal Bonds Payment as shall represent Municipal Bonds Interest Payment not required for deposit in the Interest Account for the purpose of paying interest accruing upon the Bonds shall be deposited in the Principal Account. Any surplus which might result upon and after such deposit shall be disposed of in the manner specified in the Series Resolution authorizing such Series. (D) Neither Investment Securities nor moneys deposited with the Trustee or an escrow agent or trustee for other obligations pursuant to paragraph (B)(2) of this Section nor principal or interest payments on any such Investment Securities shall be withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the applicable Redemption Price of the Bonds or other obligations to be refunded, together with accrued interest on such Bonds or other obligations to the redemption date, and any cash received from such principal or interest payments, if not then needed for such purpose, shall, to the extent practicable, be reinvested in such Investment Securities as are described in clause (ii) of said paragraph maturing at times and in amounts sufficient to pay when due the applicable Redemption Price of such Bonds or other obligations, together with such accrued interest. ARTICLE III GENERAL TERMS AND PROVISIONS OF BONDS Section 301 - Description of Bonds; Payment. (A) The Bonds of each Series issued under the provisions hereof may be issued only as registered bonds and subject to Section 303 hereof, each Bond shall be entitled "General Obligation Bonds" and shall bear such additional letter or number series designation as shall be determined in the Series Resolution authorizing the Bonds of the Series of which such Bond is one. Unless otherwise specified in the Series Resolution authorizing such Series of Bonds, Bonds of each Series shall be in Authorized Denominations each or any integral multiple thereof, shall be numbered consecutively from 1 upwards and shall bear interest payable on Interest Payment Dates. (B) The Bonds of each Series issued hereunder shall be dated as of and bear interest from the date specified in the Series Resolution that authorized such Series, which date may be contemporaneous with or prior to or after the date of issuance of such Bonds. (C) Both the principal of and the interest on the Bonds shall be payable in any coin or currency of the United States of America, as at the respective time of payment shall be legal tender for payment of public and private debts. Payment of the interest on any Bond shall be made to the person appearing on the Bond registration books of the Bank kept for such purpose by the Trustee, the registrar hereinafter provided for as the Holder thereof, by F-5 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 17 check or draft mailed to the Holder at her or his address as it appears on such registration books or to owners of $1,000,000 or more in aggregate principal amount of Bonds by wire transfer to a bank account designated by the Holder in written instructions furnished to the Trustee. The interest on Bonds so payable, and punctually paid or duly provided for, on any Interest Payment Date will be paid to the person who is the Holder thereof at the close of business on the applicable Record Date for such interest. The principal of and premium, if any, on Bonds are payable upon presentation and surrender thereof at the principal corporate trust office of the Trustee, as paying agent, except as otherwise provided by Series Resolution. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid. (D) The Bonds of each Series may contain or have endorsed thereon such provisions, specifications and descriptive words not inconsistent with the provisions hereof as may be necessary or desirable to comply with custom, the rules of any securities exchange or commission or brokerage board or otherwise, as may be specified in the Series Resolution authorizing such Series of Bonds. Section 302 - Legends. The Bonds of each Series shall contain or have endorsed thereon a statement to the effect that the State shall not be liable thereon and that such Bond shall not be a debt of the State and may contain or have endorsed thereon such provisions, specifications and descriptive words not inconsistent with the provisions of this Resolution as may be necessary or desirable to comply with custom, or otherwise, as may be determined by the Bank prior to the delivery thereof to the Bondholder. Section 303 - Execution and Authentication. (A) The Bonds shall be executed in the name of the Bank by the manual or facsimile signature of its Chairman or Vice-Chairman and its corporate seal (or a facsimile thereof) shall be thereunto affixed, imprinted, engraved or otherwise reproduced, and attested by the manual or facsimile signature of its Secretary or such officer or employee of the Bank as shall be directed by the Series Resolution authorizing the issuance thereof, or in such other manner as may be required by law. In case any one or more of the officers or employees who shall have signed or sealed any of the Bonds shall cease to be such officer or employee before the Bonds so signed and sealed shall have been actually authenticated and delivered by the Trustee, such Bonds may, nevertheless, be authenticated and delivered as herein provided, and may be issued as if the persons who signed or sealed such Bonds had not ceased to hold such offices or be so employed. Any Bonds of a Series may be signed and sealed on behalf of the Bank by such persons as at the actual time of the execution of such Bond shall be duly authorized or hold the proper office in or employment by the Bank, although at the date of the Bonds of such Series such persons may not have been so authorized or have held such office or employment. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 18 (B) The Bonds of each Series shall bear thereon a certificate of authentication, in the form set forth in the Series Resolution authorizing such Bonds, executed manually by the Trustee. Only such Bonds as shall bear thereon such certificate of authentication shall be entitled to any right or benefit under the Resolution and no Bond shall be valid or obligatory for any purpose until such certificate of authentication shall have been duly executed by the Trustee. Such certificate of the Trustee upon any Bond executed on behalf of the Bank shall be conclusive evidence that the Bond so authenticated has been duly authenticated and delivered under the Resolution and that the Holder thereof is entitled to the benefits of the Resolution. Section 304 - Interchangeability of Bonds. Bonds, upon surrender thereof at the corporate trust office of the Trustee with a written instrument of transfer satisfactory to the Trustee, duly executed by the registered owner or their attorney duly authorized in writing, may, at the option of the registered owner thereof, be exchanged for an equal aggregate principal amount of registered Bonds of the same Series, maturity, and interest rate as the surrendered Bond. Section 305 - Negotiability, Transfer and Registry. All the Bonds issued under this Resolution shall be negotiable as provided in the Act, subject to the provisions for registration and transfer contained in this Resolution and in the Bonds. So long as any of the Bonds shall remain Outstanding, the Bank shall maintain and keep, at the corporate trust office of the Trustee, books for the registration and transfer of Bonds; and, upon presentation thereof for such purpose at said office, the Bank shall register or cause to be registered therein, and permit to be transferred thereon, under such reasonable regulations as it or the Trustee may prescribe, any Bond entitled to registration or transfer. So long as any of the Bonds remain Outstanding, the Bank shall make all necessary provisions to permit the exchange of Bonds at the corporate trust office of the Trustee. The Bank and each Fiduciary may deem and treat the person in whose name any Bond shall be registered upon the books of the Bank as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal and Redemption Price, if any, of and interest on such Bond and for all other purposes, and all such payments so made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the Bank nor any Fiduciary shall be affected by any notice to the contrary. The Bank agrees to indemnify and save each Fiduciary harmless from and against any and all loss, cost, charge, expense judgment or liability incurred by it, acting in good faith and without negligence under this Resolution, in so treating any such registered owner. Section 306 - Regulations with Respect to Exchanges and Transfers. In all cases in which the privilege of exchanging Bonds or transferring Bonds is exercised, the Bank shall ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 19 execute and the Trustee shall authenticate and deliver Bonds in accordance with the provisions of this Resolution. All Bonds surrendered in any such exchanges or transfers shall forthwith be cancelled by the Trustee. For every such exchange or transfer of Bonds, whether temporary or definitive, the Bank or the Trustee may, as a condition precedent to the privilege of making such exchange or transfer, make a charge sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer. Notwithstanding any other provision of this Resolution the cost of preparing each registered Bond upon each exchange or transfer, and any other expenses of the Bank or the Trustee incurred in connection therewith (except any applicable tax, fee or other governmental charge) shall be paid by the Bank as an Administrative Expense. Neither the Bank or the Trustee shall be required (i) to make any exchange or transfer of Bonds of any Series during the ten (10) days (or such other period of time as may be specified in the Series Resolution authorizing such Series) next preceding an interest payment date on the Bonds of such Series or preceding any selection of Bond of such Series to be redeemed or (ii) to transfer or exchange any Bonds previously called for redemption. Section 307 - Bonds Mutilated, Destroyed, Stolen or Lost. In case any Bond shall become mutilated or be destroyed, stolen or lost, the Bank shall execute and the Trustee shall authenticate and deliver a new Bond of like Series, maturity and principal amount as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond, upon surrender and cancellation of such mutilated Bond or in lieu of and substitution for the Bond destroyed, stolen or lost, upon filing with the Bank evidence satisfactory to the Bank and the Trustee that such Bond have been destroyed, stolen or lost and proof of ownership thereof, and upon furnishing the Bank and the Trustee with indemnity satisfactory to them and complying with such other reasonable regulations as the Bank and the Trustee may prescribe and paying such expenses as the Bank and the Trustee may incur in connection therewith. All Bonds so surrendered to the Trustee shall be cancelled by it and evidence of such cancellation shall be given to the Bank. Any such new Bonds issued pursuant to this section in substitution for Bonds alleged to be destroyed, stolen or lost shall constitute original additional contractual obligations on the part of the Bank, regardless of whether the Bonds so alleged to be destroyed, stolen or lost be at any time enforceable by anyone, and shall be equally secured by and entitled to equal and proportionate benefits with all other Bonds issued under this Resolution, in any moneys or securities held by the Bank or the Fiduciaries for the benefit of the Bondholders. If a Bondholder satisfies the conditions set forth in this section for the replacement of a mutilated Bond or a Bond alleged to be destroyed, stolen, or lost and such Bond has matured or all principal thereof and interest thereon shall become due for any other reason, then the Trustee may pay such principal of and interest on such Bond without issuing a replacement Bond. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 20 Section 308 - Preparation of Definitive Bonds; Temporary Bonds. Until the definitive Bonds of any Series are prepared, the Bank may execute, in the same manner as is provided in Section 303, and upon the request of the Bank, the Trustee shall authenticate and deliver, in lieu of definitive Bonds, but subject to the same provisions, limitations and conditions as the definitive Bonds, except as to the denominations thereof and as to exchangeability for registered Bonds, one or more temporary Bonds, substantially of the tenor of the definitive Bonds in lieu of which such temporary Bond or Bonds are issued in such denominations as may be authorized by the Bank, and with such omissions, insertions and variations as may be appropriate to temporary Bonds. The Bank at its own expense shall prepare and execute and, upon the surrender thereof of such temporary Bonds to the Trustee. The Trustee shall authenticate and, without charge to the holder thereof, deliver in exchange therefor definitive Bonds of the same aggregate principal amount and Series and maturity as the temporary Bonds surrendered. Until so exchanged, the temporary Bonds shall in all respects be entitled to the same benefits and security as definitive Bonds authenticated and issued pursuant to this Resolution. If the Bank shall authorize the issuance of temporary Bonds in more than one denomination, the holder of any temporary Bond or Bonds may, at his option, surrender the same to the Trustee in exchange for another temporary Bond or Bonds of like aggregate principal amount, Series and maturity of any other authorized denomination or denominations, and thereupon the Bank shall execute and the Trustee shall authenticate and, in exchange for the temporary Bond or Bonds so surrendered and upon payment of the taxes, fees and charges provided for in Section 306, shall deliver a temporary Bond or Bonds of like aggregate principal amount, Series and maturity in such other authorized denomination or denominations as shall be requested by such holder. All temporary Bonds surrendered in exchange either for another temporary Bond or Bonds or for a definitive Bond or Bonds shall be forthwith cancelled by the Trustee. Section 309 - Cancellation and Destruction of Bonds. All Bonds paid or redeemed, either at or before maturity, shall be delivered to the Trustee when such payment or redemption is made, and such Bonds, together with all Bonds purchased by the Trustee, shall thereupon be promptly cancelled. Bonds so cancelled may, at any time, be cremated or otherwise destroyed by the Trustee, who shall execute a Certificate of cremation or destruction in duplicate by the signature of one of its authorized officers describing the Bonds so cremated or otherwise destroyed, and one executed Certificate shall be filed with the Bank and the other executed Certificate shall be retained by the Trustee. ARTICLE IV REDEMPTION OF BONDS Section 401 - Redemption Provisions. The Bonds of each Series may be subject to redemption prior to maturity at such times and F-6 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 21 upon such terms as shall be fixed by the related Series Resolution. If less than all of the Bonds of any one maturity of a Series shall be called for redemption, the particular units of Bonds, as determined in accordance with Section 403 herein, to be redeemed shall be selected by lot by the Trustee, or in any manner as the Trustee, in its sole discretion, may deem appropriate and fair. Section 402 - Notice of Redemption. (A) In the event any of the Bonds are to be redeemed, the Registrar shall cause notice to be given as provided in this Section 402. Unless otherwise specified in the Series Resolution authorizing the issuance of the applicable Series of Bonds, notice of redemption (i) shall be filed with the paying agent designated for the Bonds being redeemed and (ii) shall be mailed by first class mail, postage prepaid, to all Bondholder of Bonds to be redeemed at their addresses as they appear on the registration books of the Trustee, at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption. Such notice shall state the following information: (1) the complete official name of the Bonds, including Series, to be redeemed, the identification numbers of Bonds and the CUSIP numbers, if any, of the Bonds being redeemed, provided that any such notice shall state that no representation is made as to the correctness of CUSIP numbers either as printed on such Bonds or as contained in the notice of redemption and that reliance may be placed only on the identification numbers contained in the notice or printed on such Bonds; (2) any other descriptive information needed to identify accurately the Bonds being redeemed, including, but not limited to, the original issue date or dated date of and interest rate on such Bonds; (3) in the case of partial redemption of any Bonds, the respective principal amounts thereof to be redeemed; (4) the date of mailing of redemption notices and the redemption date; (5) the redemption price; (6) that on the redemption date the redemption price will become due and payable upon each such Bond or portion thereof called for redemption, and that interest thereon shall cease to accrue from and after said date; and (7) the place where such Bonds are to be surrendered for payment of the ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 22 redemption price, designating the name and address of the redemption agent with the name of a contact person and telephone number. (B) In addition to the foregoing, further notice of any redemption of Bonds hereunder shall be given by the Trustee, at least two (2) Business Days in advance of the mailed notice to Bondholders, by registered or certified mail or overnight delivery service, to all registered securities depositories then in the business of holding substantial amounts (as reasonably determined by the Bondholders) of obligations of types comprising the Bonds and to at least two national information services that disseminate notices of redemption of obligations such as the Bonds. Such further notice shall contain the information required in clause (a) above. Failure to give all or any portion of such further notice shall not in any manner defeat the effectiveness of a call for redemption. (C) Upon the payment of the redemption price of Bonds being redeemed, each check or other transfer of funds issued for such purpose shall bear the CUSIP number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer. (D) If at the time of mailing of any notice of redemption there shall not be on deposit with the Trustee moneys sufficient to redeem all the Bonds called for redemption, such notice shall state that such redemption is subject to the deposit of the redemption moneys with the Trustee not later than the redemption date and that such notice shall be of no effect unless such moneys are so deposited. (E) A second notice of redemption shall be given, not later than ninety (90) days subsequent to the redemption date, to Bondholders of Bonds or portions thereof redeemed but who failed to deliver Bonds for redemption prior to the 60th day following such redemption date. Any notice mailed shall be conclusively presumed to have been duly given, whether or not the owner of such Bonds receives the notice. Receipt of such notice shall not be a condition precedent to such redemption, and failure so to receive any such notice by any of such Bondholders shall not affect the validity of the proceedings for the redemption of the Bonds. (F) In case any Bond is to be redeemed in part only, the notice of redemption which relates to such Bond shall state also that on or after the redemption date, upon surrender of such Bond, a new Bond in principal amount equal to the unredeemed portion of such Bond will be issued. Section 403 - Partially Redeemed Fully Registered Bonds. Unless otherwise specified in the Series Resolution authorizing the issuance of the applicable Series of Bonds, in case any registered Bond shall be redeemed in part only, upon the presentation of such Bond for such partial redemption, the Bank shall execute and the Trustee shall authenticate and shall deliver or cause to be delivered to or upon the written order of the Holder thereof, at the ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 23 expense of the Bank, a Bond or Bonds of the same Series, interest rate and maturity, in aggregate principal amount equal to the unredeemed portion of such registered Bond. Unless otherwise provided by Series Resolution, a portion of any Bond of a denomination of more than the minimum Authorized Denomination to be redeemed will be in the principal amount of the minimum Authorized Denomination or an integral multiple thereof, and in selecting portions of such Bonds for redemption, the Trustee will treat each such Bond as representing that number of Bonds of the minimum Authorized Denomination which is obtained by dividing the principal amount of such Bonds by the minimum Authorized Denomination. ARTICLE V CUSTODY AND APPLICATION OF CERTAIN PROCEEDS OF BONDS Section 501 - Application of Certain Proceeds. (A) Each Series Resolution authorizing the issuance of a Series of Bonds, a portion of the proceeds derived from the sale of which is to be applied to the purchase of Municipal Bonds, shall specify the name of each Governmental Unit which is to receive a Loan by the Bank from such proceeds and the amount of such proceeds to be applied to the making of each such Loan which shall be the amount of each such Loan. Contemporaneously with the issuance, sale and delivery of any Series of Bonds, the Bank shall apply the amount of the proceeds derived from the sale of such Series of Bonds, if any, as shall be specified in said Series Resolution for the purpose of making such Loans to each of the Governmental Units specified in the Series Resolution authorizing the issuance of such Series of Bonds. (B) Accrued interest, if any, received upon the delivery of such Series of Bonds shall be deposited in the Interest Account. The amount received as a premium over the principal amount of such Series of Bonds, if any, upon the delivery of such Series of Bonds shall be applied as provided in the Series Resolution authorizing such Series of Bonds. (C) The amount, if any, necessary to cause the amount on deposit in the Reserve Fund to satisfy the Reserve Fund Requirement. (D) Any remaining proceeds derived from the sale of a Series of Bonds shall be applied as provided in the Series Resolution authorizing such Series of Bonds. Section 502 - Loans. (A) A Loan to each Governmental Unit shall be made from the portion of the proceeds derived from the sale of each Series of Bonds specified in the Series Resolution authorizing the issuance of such Series of Bonds and the amount of each such Loan shall be the amount specified in such Series Resolution. All such payments made pursuant to such Series Resolution shall be subject to the provisions and restrictions of this Article V, and the Bank covenants that it will not cause or permit to be paid from such portion of the proceeds derived from the sale of such Series of Bonds any sums except in accordance with such provisions and restrictions. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 24 (B) The Trustee shall pay to each Governmental Unit the amount of the Loan upon receipt by the Trustee of: (1) a written requisition of the Bank signed by an Authorized Officer stating (i) the name of the Governmental Unit to which the payment is to be made; and (ii) the amount to be paid; (2) a certificate signed by an Authorized Officer and attached to the requisition certifying that the terms and provisions of the Loan Agreement providing for such Loan are in compliance with Section 913, and that to the knowledge of such Authorized Officer such Governmental Unit is not in default under any of the terms or provisions of said Loan Agreement; (3) a Counsel's Opinion stating that such Municipal Bonds are valid obligations of such Governmental Unit as required by the Act and that the Loan Agreement has been duly authorized and executed by the Governmental Unit and constitutes a valid and binding obligation of the Governmental Unit enforceable in accordance with its terms; and (4) such Municipal Bonds of such Governmental Unit, registered as to both principal and interest in the name of the Bank or the Trustee and delivered in accordance with the Act. Upon receipt of such requisition, accompanying certificate, Counsel's Opinion and Municipal Bonds, the Trustee shall pay such amount directly to the Governmental Unit entitled thereto as named in such requisition. Section 503 - Retention and Inspection of Documents. All requisitions and certificates and Counsel's Opinions and Municipal Bonds received by the Trustee, as required in this Article V as conditions of payment may be relied upon by and shall be retained in the possession of the Trustee, subject at all times during normal business hours to the inspection of the Bank and, after written request received by the Trustee at least five business days prior to the date of inspection, by any Holder of at least five per cent in principal amount of the Series of Outstanding Bonds. ARTICLE VI ESTABLISHMENT OF FUNDS AND ACCOUNTS AND APPLICATION THEREOF Section 601 - Pledge. (A) The Bonds shall be direct and general obligations of the Bank, and its full faith and credit are pledged to the payment of the principal and redemption premium, if any, of and interest on the Bonds, subject to any agreements heretofore and hereafter made with the Holders of any other notes or bonds of the Bank pledging any particular revenues or assets not pledged under this Resolution. (B) The Municipal Bonds and the Municipal Bonds Payment, the investments thereof and the proceeds of such investments, if any, and all funds and accounts established by this Resolution to be held by the Trustee are hereby pledged and assigned for the payment of the principal of, Redemption Price of, interest F-7 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 25 on, and Sinking Fund Installments for, the Bonds in accordance with the terms and provisions of this Resolution, subject only to the provisions of this Resolution permitting the application thereof for the purposes and on the terms and conditions set forth in this Resolution authorizing the Bank to create Security Interests in said Municipal Bonds and Municipal Bonds Payment in favor of Credit Enhancement Agencies and counterparties to Interest Rate Exchange Agreements. Subject to the provisions of Section 805 of this Resolution, this pledge shall be valid and binding from and after the date of adoption of this Resolution, and the Municipal Bonds and the Municipal Bonds Payment and all other monies and securities in the funds and accounts established by this Resolution to be held by the Trustee hereby pledged shall immediately be subject to the lien of such pledge without any further act, and such lien shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the Bank, regardless of whether such parties have notice thereof. Section 602 - Establishment of Funds and Accounts. (A) The Alaska Municipal Bond Bank Debt Service Fund (the "Debt Service Fund") is hereby established and shall be maintained and held by the Trustee pursuant to the provisions of this Resolution. There is hereby created and established in the Debt Service Fund an "Interest Account," a "Principal Account" and a "Redemption Account" each of which shall be held by the Trustee. Amounts in the Interest Account, the Principal Account and the Redemption Account shall be used solely for the purpose of paying the principal of, Redemption Price of, interest on and Sinking Fund Installments for, the Bonds and of retiring such Bonds at or prior to maturity in the manner provided herein and in any Series Resolution. Amounts deposited in the Interest Account and the Principal Account shall be disbursed and applied by the Trustee at the times and in the manner provided in this Article VI and in paragraph (3) of Section 203. (B) There is hereby established within the Alaska Municipal Bond Bank Reserve Fund created by Section 44.85.270 of the Act, a 2005 General Obligation Bond Resolution Reserve Account (the "Reserve Fund") which shall be maintained and held by the Trustee pursuant to the provisions of this Resolution. (C) There is hereby established a Rebate Fund, and within such fund, a separate account for each Series of Bonds. (D) There is hereby established an Operating Fund which shall be held by the Bank pursuant to the provisions of this Resolution. Section 603 - Reserve Fund. (A) On or before the first day of each month, the Trustee shall set aside from amounts in the Reserve Fund derived from income or interest earned and profits realized by the Reserve Fund due to the investment thereof, an amount which, when added to the amounts theretofore set aside for such purpose and not paid into the Interest Account, will on such day be equal to the unpaid interest on the Reserve Fund Obligations accrued and to accrue to the last day of such month. If the Trustee so determines, said amounts may be deposited in an account which ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 26 the Trustee may create in the Reserve Fund under the name of "Reserve Fund Obligations Interest Account". On or before each interest payment date of the Reserve Fund Obligations, said amounts shall be deposited in the Interest Account. (B) On or before each principal payment date and Sinking Fund Installment payment date of Reserve Fund Obligations, the Trustee shall withdraw from amounts in the Reserve Fund and deposit in the Principal Account, an amount which, when added to the amount then on deposit in the Principal Account and derived from sources other than Municipal Bonds Payment, will be equal to the Principal Installment of the Reserve Fund Obligations falling due on such date. (C) On or before December 31 of each year, after complying with the provisions of paragraphs (1) and (2) above to the extent required by such date, the Trustee shall withdraw from the Reserve Fund, any amount remaining therein derived from income or interest earned and profits realized by the Reserve Fund due to the investment thereof, and pay over said amount to the Bank for deposit in the Operating Fund but only to the extent that there remains after such withdrawal an amount in the Reserve Fund at least equal to the Required Debt Service Reserve. (D) The Reserve Fund Requirement may be satisfied with (i) monies made available by the State and paid to the Bank for the purpose of the Alaska Municipal Bond Bank Reserve Fund created by Section 44.85.270 of the Act in the amount provided by a Series Resolution; (ii) all monies paid to the Bank pursuant to the Act for the purpose of restoring the Reserve Fund to the amount of the Required Debt Service Reserve; (iii) such portion of the proceeds of sale of Bonds, if any, as shall be provided by any Series Resolution; (iv) Credit Enhancement; (v) any other monies which may be made available to the Bank for the purposes of the Reserve Fund from any other source or sources; or (vi) any combination of the foregoing. (E) In the event there shall be, on any interest payment date, a deficiency in the Interest Account, or, in the event there shall be, on any principal payment date or Sinking Fund Installment payment date, a deficiency in the Principal Account, the Trustee shall make up such deficiencies from the Reserve Fund by the withdrawal of cash therefrom for that purpose and by the sale or redemption of securities held in the Reserve Fund, if necessary, in such amounts as will, at the respective times, provide monies in the Interest Account and Principal Account sufficient to make up any such deficiency. If a deficiency still exists immediately prior to a debt service payment date and after the withdrawal of cash, the Bank shall then draw from any Credit Enhancement for the Bonds in sufficient amount to make up such difference. Drawings under the Credit Enhancement shall be made on a pro-rata basis (in proportion to the respective maximum coverages) available under the Credit Enhancement. Such draw shall be made at such times and under such conditions as such Credit Enhancement shall provide. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 27 Section 604 - Interest Account, Principal Account and Redemption Account. (A) Except as otherwise provided in paragraph (3) of Section 204, the Trustee shall deposit Municipal Bonds Interest Payments and any other monies available for the payment of interest in the Interest Account upon receipt thereof. The Trustee shall, on or before each interest payment date of the Bonds, pay, out of amounts then held for the credit of the Interest Account, to itself and the Paying Agents, the amounts required for the payment by it and such Paying Agents of the interest becoming due on the Bonds on such interest payment date, and such amounts so withdrawn are hereby irrevocably pledged for and shall be applied to the payment of such interest. The Trustee shall also pay out of the Interest Account to itself and the appropriate Paying Agents, on or before any redemption date for Bonds being refunded by Refunding Bonds, the amount required for the payment of interest on the Bonds then to be redeemed, to the extent not otherwise provided in this Resolution. (B) The Trustee shall deposit Municipal Bonds Principal Payments and any other monies available for the payment of principal in the Principal Account, upon receipt thereof. The Trustee shall, on or before each principal payment date of or Sinking Fund Installment date for, the Bonds, pay, out of the monies then held for the credit of the Principal Account, to itself and the Paying Agents, the amounts required for the payment by it and such Paying Agents of the principal or Sinking Fund Installment due on the Bonds on such date, and such amounts so withdrawn are hereby irrevocably pledged for and shall be applied to the payment of such principal or Sinking Fund Installment. (C) The Trustee shall establish in the Redemption Account a separate sub-account for the Bonds of each Series Outstanding. (1) Any monies deposited into the Redemption Account from any source other than pursuant to Section 607 or Section 916 shall be applied to the purchase or redemption of Bonds in a manner to be determined by the Bank in accordance with Article IV. Any monies deposited into the Redemption Account pursuant to Section 607 shall be applied to the purchase or redemption of Reserve Fund Obligations in a manner to be determined by the Bank in accordance with Article IV. (2) The Bank shall deposit or cause to be deposited in the Redemption Account such portion of the monies received as the proceeds of sale or redemption of Municipal Bonds, as required by Section 916 hereof, and, upon any such deposit, shall advise the Trustee in writing of the Series of Bonds to which the same relates. Upon receipt, such monies shall be set aside by the Trustee in the appropriate Series sub-account. Monies so held in each separate sub-account by the Trustee shall be applied to the purchase or retirement of the Bonds of the Series in respect of which such sub-account was created as follows: (i) The Trustee shall promptly apply such monies to the purchase of Bonds of the Series in respect of which ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 28 such sub-account was created having the same maturity date or dates and in the same principal amount within each maturity as the Municipal Bonds Principal Payments required to be made for the Municipal Bonds sold by the Bank or redeemed by the Governmental Unit at the most advantageous price obtainable with reasonable diligence, such price, however, not to exceed the Redemption Price which would be payable on the next ensuing date on which the Bonds of the Series so purchased are redeemable according to their terms. The Trustee shall pay the interest accrued on the Bonds so purchased to the date of sale or redemption of the Municipal Bonds from the Interest account and the balance of the purchase price from the applicable sub-account in the Redemption Account, as hereinabove provided, but no such purchase shall be made by the Trustee within the period of forty-five (45) days next preceding a date on which such Bonds are subject to redemption under the provisions of the Series Resolution authorizing the issuance thereof. (ii) In the event the Trustee is able to purchase the requisite principal amount of Bonds from a sub-account in accordance with and under the foregoing provisions of this subparagraph (b) at a purchase price less than the sum of the deposits to such sub-account from the proceeds from the sale or redemption of Municipal Bonds and the applicable transfers from the Interest Account, upon the payment by the Trustee of the purchase price of such Bonds, the Trustee shall transfer the balance of monies remaining in such sub-account to the Bank for deposit in the Operating Fund. (iii) In the event the Trustee is unable to purchase the requisite principal amount of Bonds the Trustee shall call for redemption on the next ensuing redemption date such amount of Bonds of the Series in respect of which such sub-account was created having the same maturity date or dates and in the same principal amount within each maturity as the Municipal Bonds Principal Payments required to be made for the Municipal Bonds sold by the Bank or redeemed by the Governmental Unit, as, at the Redemption Price thereof, will exhaust said sub-account as nearly as may be. Such redemption shall be made pursuant to the provisions of Article IV hereof. The Trustee shall pay the interest accrued on the Bonds so redeemed to the date of sale or redemption of the Municipal Bonds from the Interest Account and the balance of such interest to the date of redemption of the Bonds and the Redemption Price from the applicable sub-account. (3) The Bank may, from time to time, by written instructions direct the Trustee to make purchases under subparagraph (b) above only F-8 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 29 after receipt of tenders. The Bank may specify the length of notice to be given and the date on which tenders are to be accepted or may authorize the Trustee to determine the same in its discretion. All such tenders shall be by sealed proposals and no tenders shall be considered or accepted at any price exceeding the price specified under subparagraph (b) above for the purchase of Bonds. The Trustee shall accept tenders with the lowest price, as determined by the Trustee, and if the monies available for purchase pursuant to such tenders are not sufficient to permit acceptance of all tenders and there shall be tenders at an equal price above the amount of monies available for purchase then the Trustee shall select by lot, in such manner as the Trustee shall determine in its discretion, the Bonds tendered which shall be purchased. No purchase of Bonds, either on tenders or otherwise, shall be made by the Trustee within the period of forty-five (45) days next preceding any date on which such Bonds are subject to redemption. (D) Monies set aside from time to time with the Trustee and Paying Agents for the payment of principal or Redemption Price of, interest on and Sinking Fund Installments for, the Bonds shall be held in trust for the Holders of the Bonds. Until so set aside for the payment of such principal, Redemption Price, interest, and Sinking Fund Installments, all monies in such accounts shall be held in trust for the benefit of the Holders of all Bonds at the time Outstanding equally and ratably and without any preference or distinction as between Bonds of different Series, except that monies on deposit in the separate sub-accounts established in the Redemption Account shall be held in trust for and applied to the payment of the Bonds of the Series for which the applicable sub-account was established. Section 605 - Rebate Fund. (A) The Trustee shall establish and thereafter maintain, so long as the Bonds are Outstanding, a Rebate Fund which shall be held separate and apart from all other funds and accounts established under this Resolution and from all other moneys of the Trustee. (B) All amounts in the Rebate Fund, including income earned from investment of the fund, shall be held by the Trustee free and clear of the lien of this Resolution. In the event the amount on deposit in the Rebate Fund exceeds the aggregate amount of the Rebate Requirement for all Series of Bonds, as verified in writing by an independent public accountant or other qualified professional selected by the Bank at the time the Rebate Requirement is determined, less amounts of the Rebate Requirement theretofore paid to the United States for all Series of Bonds, the Trustee shall, upon the Bank's request, withdraw from the Rebate Fund and pay to or upon the order of the Bank an amount not to exceed such excess to the Bank for deposit in the Operating Fund. (C) The Bank shall determine the amount of the Rebate Requirement with respect to each Series of Bonds on each applicable Rebate Calculation Date. The Bank shall deposit into the Rebate Fund the Rebate Requirement, if any, with respect to each Series of Bonds. The Bank shall instruct the Trustee to ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 30 withdraw from the Rebate Fund and pay over to the United States Government with respect to each Series of Bonds: (1) not less frequently than once each five years commencing no later than 60 days after the first Rebate Calculation Date for such Series of Bonds and upon each fifth anniversary of such date, an amount which when added to all previous rebate payments made with respect to such Series of Bonds equals 90% of the sum of the Rebate Requirement pertaining to such Series of Bonds plus the amount, if any, of Rebate Requirement theretofore paid to the United States with respect to such Series of Bonds, and (2) not later than 60 days after the retirement of the last Bond of such Series, 100% of the Rebate Requirement with respect to such Series. The determination of rebatable arbitrage made with respect to each such payment date and with respect to any withdrawal and payment to the Bank from the Rebate Fund pursuant to this Resolution must be verified in writing by an independent public accountant or other qualified professional selected by the Bank. (D) The Trustee shall, at least sixty (60) days prior to each Rebate Calculation Date, notify the Bank of the requirements of this Section. By agreeing to give this notice, the Trustee assumes no responsibility whatsoever for compliance by the Bank with the requirements of Section 148 of the Code or any successor. The Bank expressly agrees that (notwithstanding any other provision of this Resolution) any failure of the Trustee to give any such notice, for any reason whatsoever, shall not cause the Trustee to be responsible for any failure of the Bank to comply with the requirements of said Section 148 or any successor thereof. (E) The Trustee, on behalf of the Bank, shall keep and retain, until the date six years after the retirement of the last of the Bonds of each Series, records with respect to each Series of the Bonds and the investment and expenditure of amounts on deposit with the Trustee to comply with the aforementioned arbitrage rebate requirements, including without limitation a complete list of all investments and reinvestments of amounts on deposit with the Trustee with respect to each Series of the Bonds. For purposes of the computation required above, the Trustee shall, upon request, furnish to the Bank all information in the Trustee's control which is necessary for such computations. (F) The Bank hereby covenants and agrees that it will not enter, and will not cause the Trustee to enter into, any transaction or cause any transaction to be entered into with respect to the investment of gross proceeds of the Bonds, or otherwise, which reduces the amount which may be required to be paid to the United States pursuant to the arbitrage rebate requirements specified herein above, because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm's length and had the yield on each Series of the Bonds not been relevant to either party. (G) The provisions of this Section may be amended or deleted, with respect to any or all series of the Bonds, from this Resolution ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 31 upon receipt by the Bank and the Trustee of an opinion of bond counsel that such amendment or deletion will not adversely affect the exclusion from gross income of interest on the Bonds. Section 606 - Operating Fund. There shall be deposited in the Operating Fund all Fees and Charges collected by the Bank or the Trustee, to the extent not otherwise encumbered or pledged, and any other monies which may be made available to the Bank for the purposes of the Operating Fund from any other source or sources including, without limiting the generality of the foregoing, amounts transferred pursuant to paragraph (3) of Section 603, subparagraph (b)(ii) of paragraph (3) of Section 604 and the amount received as a premium over the principal amount of a Series of Bonds, if any, to the extent provided in the Series Resolution authorizing such Series. Monies at any time held for the credit of the Operating Fund shall be used for and applied solely to the following purposes: (a) To pay the Administrative Expenses of the Bank; (b) To pay the fees and expenses of the Trustee and Paying Agents; (c) To pay financing costs incurred with respect to a Series of Bonds, including fees and expenses of the attorneys, initial Trustee's and Paying Agents' fees and expenses, costs and expenses of financial consultants, printing costs and expenses, the payment to any officers, departments, boards, agencies, divisions and commissions of, or reimbursement to, the State of any statement of cost and expense or advances rendered to the Bank pursuant to the Act, and all other financing and other miscellaneous costs; and (d) To pay any expenses in carrying out any other purpose then authorized by the Act. All amounts in the Operating Fund shall be free and clear of any lien or pledge created by this Resolution but shall be held and applied in accordance with this section. Section 607 - Reduction of Required Debt Service Reserve. Whenever the amount of the Required Debt Service Reserve is reduced, the Trustee, only upon the written request of the Bank signed by an Authorized Officer, shall withdraw from any amounts on deposit in the Reserve Fund and deposit in the Redemption Account any amount not exceeding the amount of such reduction of the Required Debt Service Reserve. The amount to be withdrawn from the Reserve Fund in each instance pursuant to the provisions of this paragraph shall be determined by the Bank and the amount thereof certified to the Trustee in writing signed by an Authorized Officer. Section 608 - Trustee's Maintenance of Records on Payment of Bonds. In connection with the payment, redemption or purchase of all Bonds under the provisions of this Resolution, the Trustee shall keep accurate records of the source of the monies used to pay, redeem or purchase such Bonds. Section 609 - Obtaining Credit Enhancements and Interest Rate Exchange Agreements. Except as otherwise provided in a ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 32 Series Resolution authorizing the issuance of a Series of Bonds, the Bank may obtain Credit Enhancement or an Interest Rate Exchange Agreement with respect to such Bonds either at the time of issuance of the Bonds or any time thereafter. Section 610 - Creation of Additional Funds, Accounts and Subaccounts; Separate Credit Enhancement Funds; Pledge with Respect to Credit Enhancements and Interest Rate Exchange Agreements. (A) The Trustee shall establish within any Fund such Accounts in addition to the Accounts herein established as the Bank shall by Series Resolution or Supplemental Resolution determine and shall in like manner establish within any Account such additional subaccounts for the purposes of such Account as the Bank shall so determine. (B) The Bank may at any time by execution of a Series Resolution or Supplemental Resolution establish a Fund or Account in which to hold any Credit Enhancement and the proceeds thereof or drawings thereunder (a "Credit Enhancement Fund") for the benefit of any Series of Bonds to which such Credit Enhancement has been pledged, which pledge may be (but is not required to be) exclusively for the benefit of such Series of Bonds or certain designated Series of Bonds and not equally and ratably among all the Series of Bonds. Amounts held in a Credit Enhancement Fund shall not be considered a part of the Municipal Bonds Payment but, rather, shall be subject to such lien and pledge as may be created in the Series Resolution creating such Credit Enhancement Fund. (C) If the Bank creates a Credit Enhancement Fund, the Bank may direct, in the Series Resolution creating such Credit Enhancement Fund, that the Trustee pay, and if so directed in writing by the Bank the Trustee shall pay, principal (including premium, if any) of and interest on the Bonds secured by such Credit Enhancement Fund directly from amounts in such Credit Enhancement Fund and that the Trustee reimburse, and if so directed in writing by the Bank the Trustee shall so reimburse, such Credit Enhancement Fund for such payment from the Credit Enhancement Fund; provided, however, that the Bank may, in the Series Resolution authorizing the Series of Bonds to be secured by Credit Enhancement, treat any, or any part of any, obligation owed or which may in the future be owed to the Credit Enhancement Agency pursuant to the Credit Enhancement Instrument as the Series of Bonds secured by such Credit Enhancement if the Corporation, at the time of issuance of said Series of Bonds and at the time of the creation of any such obligation satisfies the requirements of Section 203, in which case the Trustee shall pay the principal of and interest on any such obligations in accordance with the terms of this Resolution treating such obligations as a Series of Bonds. In a Series Resolution authorizing a Series of Bonds secured by a Credit Enhancement Fund the Bank may fix provisions relating to such Fund pursuant to the terms of a Series Resolution. In addition to the foregoing, the Bank may agree to permit a Credit Enhancement Agency to be subrogated to the rights of any Bondholders whose Bonds are secured by the Credit Enhancement provided F-9 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 33 that such Credit Enhancement Agency is not in default under such Credit Enhancement. ARTICLE VII SECURITY FOR DEPOSITS AND INVESTMENT OF FUNDS Section 701 - Security for Deposits. All monies held hereunder by the Trustee shall be continuously and fully secured, for the benefit of the Bank and the Holders of the Bonds in such manner as may then be required or permitted by applicable State or federal laws and regulations regarding the security for, or granting a preference in the case of, the deposit of trust funds. The Trustee or any Paying Agent shall not be required to give security for the deposit of any monies with them held in trust for the payment of the principal or Redemption Price of or interest on any Bonds, or for the Trustee to give security for any monies which shall be represented by obligations purchased under the provisions of this Resolution as an investment of such monies. Section 702 - Investment of Funds and Accounts Held by the Trustee. (A) Upon the deposit of any amounts in any fund or account held by the Trustee under the provisions of this Resolution, in the manner hereinabove prescribed, the Bank may furnish the Trustee with a schedule of dates on which it is estimated by the Bank that such monies in said fund or account will be required to be expended. The Bank may from time to time amend the schedule so furnished. Upon receipt of such schedule or amended schedule, the Bank may direct the Trustee to, or in the absence of receipt of such schedule or such direction the Trustee shall, invest and reinvest in Investment Securities the monies in said fund or account so that the maturity date or date of redemption at the option of the holder of such obligations shall coincide as nearly as practicable with the times at which monies are needed by the Bank to be so expended. The Bank also may direct the Trustee that all or part of the amounts in the Interest Account and the Principal Account in the Debt Service Fund not be invested for specified periods of time. (B) Obligations purchased as an investment of monies in any fund or account held by the Trustee under the provisions of this Resolution shall be deemed at all times to be a part of such fund or account and the income or interest earned, profits realized or losses suffered by a fund or account due to the investment thereof shall be retained in, credited or charged, as the case may be, to such fund or account, except that the income or interest earned and profits realized by the Reserve Fund due to the investment thereof shall be transferred by the Trustee in accordance with and to the extent provided by paragraphs (1), (3) and (5) of Section 603. (C) In determining whether or not the amount in the Reserve Fund is at least equal to the Reserve Fund Requirement, the Trustee shall include the amount of interest earned or accrued thereon as of the date of evaluation and shall also include, but only if any other requirement therefor specified in a Series Resolution has been satisfied, the principal ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 34 component of any Credit Enhancement then on deposit in the Reserve Fund. (D) Except as otherwise provided in the Resolution, the Trustee shall sell at the best price obtainable, or present for redemption or exchange, any obligation purchased by it as an investment pursuant to this Resolution whenever it shall be requested in writing by an Authorized Officer of the Bank to do so or whenever it shall be necessary in order to provide monies to meet any payment or transfer from the fund or account for which such investment was made. The Trustee shall advise the Bank in writing, on or before the twentieth day of each calendar month, of the details of all investments held for the credit of each fund and account in its custody under the provisions of this Resolution as of the end of the preceding month. Section 703 - Liability of Trustee for Investments. The Trustee shall not be liable or responsible for the making of any investment authorized by the provisions of this Article, in the manner provided in this Article, or for any loss resulting from any such investment so made except for its own negligence or default. ARTICLE VIII THE TRUSTEE AND THE PAYING AGENTS Section 801 - Appointment and Acceptance of Duties of Trustee. J.P. Morgan Trust Company, National Association, a trust company or bank having the powers of a trust company doing business and having a corporate trust office in Seattle, Washington, is hereby appointed as Trustee for the Holders from time to time of the Bonds. The Trustee shall signify its acceptance of the duties and obligations imposed upon it by this Resolution by executing the certificate of authentication endorsed upon the Bonds, and, by executing such certificate upon any Bond, the Trustee shall be deemed to have accepted such duties and obligations not only with respect to the Bond so authenticated, but with respect to all the Bonds thereafter to be issued, but only, however, upon the terms and conditions set forth in the Resolution. Section 802 - Appointment and Acceptance of Duties of Paying Agents. The Bank shall appoint one or more Paying Agents for the Bonds of any Series in the Series Resolution authorizing such Bonds or shall appoint such Paying Agent or Paying Agents by or pursuant to a resolution of the Bank adopted prior to the authentication and delivery of such Bonds, and may at any time or from time to time appoint one or more other Paying Agents in the manner and subject to the conditions set forth in Section 812 for the appointment of a successor Paying Agent. The Trustee may be appointed to act as Paying Agent notwithstanding that it may then be acting in the capacity of Trustee. Each Paying Agent shall signify its acceptance of the duties and obligations imposed upon it by this Resolution by written instrument of acceptance executed and delivered to the Bank and the Trustee. The principal or corporate trust offices of the Paying Agents are hereby designated as the respective agencies of the Bank for the payment of the interest on and principal or Redemption Price of the Bonds. Section 803 - Responsibilities of Fiduciaries. (A) The recitals of fact herein and in ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 35 the Bonds contained shall be taken as the statements of the Bank and the Fiduciaries assume any responsibility for the correctness of the same. No Fiduciary shall be deemed to make any representations as to the validity or sufficiency of this Resolution or of any Bonds issued hereunder or in respect of the security afforded by this Resolution, and no Fiduciary shall incur any responsibility in respect thereof. The Trustee shall, however, be responsible for its representations contained in its certificate on the Bonds. No Fiduciary shall be under any responsibility or duty with respect to any other Fiduciary. No Fiduciary shall be under any obligation or duty to perform any act which would involve it in expense or liability or to institute or defend any suit in respect hereof, or to advance any of its own moneys, unless indemnified to its satisfaction. No Fiduciary shall be liable in connection with the performance of its duties hereunder except for its own negligence or willful misconduct. Neither the Trustee nor any Paying Agent shall be under any responsibility or duty with respect to the application of any moneys paid to any one of the others or the use or application by the Bank of the Bonds or the proceeds thereof. (B) Except during the continuance of an Event of Default, the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Resolution, and no implied covenants or obligations shall be read into this Resolution against the Trustee, and, in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinion expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Resolution. (C) In case an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Resolution and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his own affairs. (D) No provision of this Resolution shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that (1) the Trustee shall not be liable for any error of judgment made in good faith by a responsible officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts, (2) the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Bonds relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Resolution, and (3) no provision of this Resolution shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Except as otherwise expressly provided herein, the Trustee ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 36 shall determine whether any conditions or requirements set forth herein for any purpose have been met, and such determination by the Trustee shall be conclusive. (E) Regardless of whether it is therein expressly so provided, every provision of this Resolution, any Series Resolution, or any related document relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Article. (F) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Resolution at the request or direction of any of the Bondholders pursuant to this Resolution, unless such Bondholders shall have offered to the Trustee security or indemnity to its satisfaction against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction. (G) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, or other paper or document. (H) The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys, and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. (I) The permissive right of the Trustee to do things enumerated in this Resolution shall not be construed as a duty. (J) In accepting the trusts hereby created, the Trustee acts solely as Trustee for the Bondholders and not in its individual capacity and all persons, including, without limitation, the Bondholders and the Bank having any claim against the Trustee arising from this Resolution shall look only to the funds and accounts held by the Trustee or its agent hereunder for payment except as otherwise provided herein. Under no circumstances shall the Trustee be liable in its individual capacity for the obligations evidenced by the Bonds. Section 804 - Evidence on Which Fiduciaries May Act. Each Fiduciary may rely and shall be protected in acting upon any notice, resolution, request, consent, order, certificate, report, opinion, bond or other paper or document believed by it to be genuine, and to have been signed or presented by the proper party or parties. Each Fiduciary may consult with counsel, who may or may not be of counsel to the Bank, and the opinion of such shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it hereunder in good faith and in reliance thereon. Whenever any Fiduciary shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering or omitting any action hereunder, including payment of moneys out of any Fund or Account, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and F-10 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 37 established by a certificate signed by an Authorized Officer, and such certificate shall be full warrant for any action taken or suffered in good faith under the provisions of this Resolution upon the faith thereof, but in its discretion the Fiduciary may in lieu thereof accept other evidence of such fact or matter or may require such further or additional evidence as to it may seem reasonable. Except as otherwise expressly provided herein, any request, order, notice or other direction required or permitted to be furnished pursuant to any provision hereof by the Bank to any Fiduciary shall be sufficiently executed if executed in the name of the Bank by an Authorized Officer. Section 805 - Compensation. The Bank shall pay to the Trustee and to each Paying Agent from time to time reasonable compensation for all services rendered under this Resolution, and also all reasonable expenses, charges, counsel fees and other disbursements, including those of its attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Resolution, and the Trustee and each Paying Agent shall have a lien therefor on any and all funds at any time held by it under this Resolution. The Bank further agrees to indemnify and save the Trustee and each Paying Agent harmless against any liabilities which it may incur in the exercise and performance of its powers and duties hereunder, and which are not due to its negligence or default. Section 806 - Permitted Acts and Functions. The Trustee and any Paying Agent may become the owner of any Bonds, with the same rights it would have if it were not such Trustee or Paying Agent. The Trustee and any Paying Agent may act as depository for, and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the rights of Bondholders or to effect or aid in any reorganization growing out of the enforcement of the Bonds or this Resolution, whether or not any such committee shall represent the Holders of a majority in principal amount of the Bonds then Outstanding. Section 807 - Resignation of Trustee. The Trustee may at any time resign and be discharged of the duties and obligations created by this Resolution by giving not less than ninety (90) days' written notice to the Bank and to the registered owners of Bonds, specifying the date when such resignation shall take effect and such resignation shall take effect immediately upon the appointment of a successor Trustee pursuant to Section 809 hereof. Section 808 - Removal of Trustee. The Trustee shall be removed by the Bank if at any time so requested by an instrument or concurrent instruments in writing, filed with the Trustee and the Bank, and signed by the Holders of a majority in principal amount of the Bonds then Outstanding or their attorneys-in-fact duly authorized, excluding any Bonds held by or for the account of the Bank. The Bank may remove the Trustee at anytime, except during the existence of an Event of Default, for such cause as shall be determined in the sole discretion of the Bank by filing with the Trustee ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 38 an instrument signed by an Authorized Officer of the Bank. Section 809 - Appointment of Successor Trustee. In case at any time the Trustee shall resign or shall be removed or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or if a receiver, liquidator or conservator of the Trustee, or of its property, shall be appointed, or if any public officer shall take charge or control of the Trustee, or of its property or affairs, the Bank covenants and agrees that it will thereupon appoint a successor Trustee. The Bank shall provide written notice of such appointment to the registered owners of the Bonds. If in a proper case no appointment of a successor Trustee shall be made pursuant to the foregoing provisions of this Section within forty-five (45) days after the Trustee shall have given to the Bank written notice, as provided in Section 807, or after a vacancy in the office of the Trustee shall have occurred by reason of its inability to act, the Trustee or the Holder of any Bond may apply to any court of competent jurisdiction to appoint a successor Trustee. Said court may thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint a successor Trustee. Any Trustee appointed under the provisions of this Section 809 in succession to the Trustee shall be a trust company or bank in good standing having the powers of a trust company within or outside the State, and having a capital and surplus aggregating at least Fifty Million Dollars ($50,000,000) if there be such a trust company or bank willing and able to accept the office on reasonable and customary terms and authorized by law to perform all the duties imposed upon it by this Resolution. Section 810 - Transfer of Rights and Property to Successor Trustee. Any successor Trustee appointed under this Resolution shall execute, acknowledge and deliver to its predecessor Trustee, and also to the Bank, an instrument accepting such appointment, and thereupon such successor Trustee, without any further act, deed or conveyance, shall become fully vested with all monies, estates, properties, rights, powers, duties and obligations of such predecessor Trustee, with like effect as if originally named as Trustee; but the Trustee ceasing to act shall nevertheless, on the written request of the Bank, or of the successor Trustee, execute, acknowledge and deliver such instruments of conveyance and further assurance and do such other things as may reasonably be required for more fully and certainly vesting and confirming in such successor Trustee all the right, title and interest of the predecessor Trustee in and to any property held by it under this Resolution, and shall pay over, assign and deliver to the successor Trustee any money or other property subject to the trusts and conditions herein set forth. Should any deed, conveyance or instrument in writing from the Bank be required by such successor Trustee for more fully and certainly vesting in and confirming to such successor Trustee any such estates, rights, powers and duties, any and all such deeds, conveyances and instruments in writing shall, on request, and so far as may be authorized by law, ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 39 be executed, acknowledged and delivered by the Bank. Any such successor Trustee shall promptly notify the Paying Agents of its appointment as Trustee. The Bank shall pay the expenses of effecting a transfer under this Section. Section 811 - Merger or Consolidation. Any company into which the Fiduciary may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which Fiduciary may sell or transfer all of its corporate trust business, shall be the successor to such Fiduciary without the execution or filing of any paper or the performance of any further act, provided that such company shall be a trust company or bank which is qualified to be a successor to the Trustee under Section 809 or which is qualified to be a successor to the Paying Agent under Section 812. Section 812 - Resignation or Removal of the Paying Agents and Appointment of Successors. Any Paying Agent may at any time resign and be discharged of the duties and obligations created by this Resolution by giving at least sixty (60) days written notice to the Bank and the Trustee. Any Paying Agent may be removed at any time by an instrument filed with such Paying Agent and the Trustee and signed by an Authorized Officer of the Bank. Any successor Paying Agent shall be appointed by the Bank and shall be a trust company or bank having the powers of a trust company having a capital and surplus aggregating at least Fifty Million Dollars ($50,000,000), and willing and able to accept the office of Paying Agent on reasonable and customary terms and authorized by law to perform all the duties imposed upon it by this Resolution. In the event of the resignation or removal of any Paying Agent, such Paying Agent shall pay over, assign and deliver any monies held by it to its successor, or if there be no successor then appointed, to the Trustee until such successor be appointed. In the event that for any reason there shall be a vacancy in the office of Paying Agent, the Trustee shall act as such Paying Agent. Section 813 - Evidence of Signatures of Bondholders and Ownership of Bonds. (A) Any request, consent or other instrument which this Resolution may require or permit to be signed and executed by the Bondholders may be in one or more instruments of similar tenor, and shall be signed or executed by such Bondholders in person or by their attorneys appointed in writing. Proof of (i) the execution of any such instrument, or of an instrument appointing any such attorney, or (ii) the holding by any person of the Bonds shall be sufficient for any purpose of this Resolution (except as otherwise herein expressly provided) if made in the following manner, but the Trustee may nevertheless in its discretion require further or other proof in cases where it deems the same desirable: (1) The fact and date of the execution by any Bondholder or his attorney of such instrument may be proved by the certificate, which need not ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 40 be acknowledged or verified, of an officer of a bank or trust company satisfactory to the Trustee or of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which she purports to act, that the person signing such request or other instrument acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer. The authority of the person or persons executing any such instrument on behalf of a corporate Bondholder may be established without further proof if such instrument is signed by a person purporting to be the president or a vice president of such corporation with a corporate seal affixed and attested by a person purporting to be its secretary or an assistant secretary; (2) The amount of Bonds transferable by delivery held by any person executing such request or other instrument as a Bondholder, and the numbers and other identification thereof, and the date of his holding such Bonds, may be proved by a certificate, which need not be acknowledged or verified, satisfactory to the Trustee, executed by an officer of a trust company, bank, financial institution or other depository or member of the National Association of Securities Dealers, Inc. wherever situated, showing that at the date therein mentioned such person exhibited to such officer or had on deposit with such depository the Bonds described in such certificate. Continued ownership after the date stated in such certificate may be proved by the presentation of such certificate if the certificate contains a statement by such officer that the depository held that Bonds therein referred to on the date of the certificate and that they will not be surrendered without the surrender of the certificate to the depository, except with the consent of the Trustee, and a certificate of the Trustee, which need not be acknowledged or verified, that such consent has not been given. (B) Except in the case of Bonds transferable by delivery only, the ownership of Bonds and the amount, numbers and other identification, and date of holding the same shall be proved by the registry books. Any request, consent or vote of the owner of any Bond shall bind all future owners of such Bond in respect of anything done or suffered to be done by the Bank or any Fiduciary in accordance therewith. ARTICLE IX COVENANTS OF THE BANK The Bank covenants and agrees with the Holders of the Bonds as follows: Section 901 - Payment of Bonds. The Bank shall duly and punctually pay or cause to be paid the principal or Redemption Price, if any, of every Bond and the interest thereon, at the dates and places and in the manner stated in the Bonds according to the true intent and F-11 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 41 meaning thereof, and shall duly and punctually pay, or cause to be paid, all Sinking Fund Installments, if any, becoming payable with respect to any Series of Bonds. Section 902 - Extension of Payment of Bonds. The Bank shall not directly or indirectly extend or assent to the extension of the maturity of any of the Bonds or the time of payment of any claims for interest by the purchase or funding of such Bonds or claims for interest or by any other arrangement and in case the maturity of any of the Bonds or the time for payment of any claims for interest shall be extended, such Bonds or claims for interest shall not be entitled in case of any default under this Resolution to the benefit of this Resolution or to any payment out of any assets of the Bank or the funds (except funds held in trust for the payment of particular Bonds or claims for interest pursuant to this Resolution) prior to benefits accorded to or the payment of the principal of all Bonds issued and Outstanding the maturity of which has not been extended and of such portion of the accrued interest on the Bonds as shall not be represented by such extended claims for interest. Nothing herein shall be deemed to limit the right of the Bank to issue Refunding Bonds as provided in Section 203 and such issuance shall not be deemed to constitute an extension of maturity of Bonds. Section 903 - Offices for Servicing Bonds. The Bank shall at all times maintain an office or agency where Bonds may be presented for transfer or exchange, and where notices, presentations and demands upon the Bank in respect of the Bonds or of this Resolution may be served. The Bank hereby appoints the Trustee as its agent to maintain such office or agency for the transfer or exchange of Bonds and for the service of such notices, presentations and demands upon the Bank and may appoint one or more co-registrars for such purposes. The Bank hereby appoints the Trustee as Paying Agent and hereby appoints the Paying Agent as its agent to maintain such offices or agencies for the payment of Bonds. Section 904 - Further Assurances. At any and all times the Bank shall, so far as it may be authorized by law, pass, make, do, execute, acknowledge and deliver, all and every such further resolutions, acts, deeds, conveyances, assignments, transfers and assurances as may be necessary for the better assuring, conveying, granting, assigning, confirming all and singular the rights, Municipal Bonds Payments, the Municipal Bonds and other monies, securities, funds and property hereby pledged or assigned, or intended so to be, or which the Bank may hereafter become bound to pledge or assign. Section 905 - Power to Issue Bonds and Make Pledges. The Bank is duly authorized pursuant to law to authorize and issue the Bonds for the purposes herein authorized and to adopt this Resolution and to pledge the Municipal Bonds Payments, the Municipal Bonds and other monies, securities, funds and property purported to be pledged by this Resolution in the manner and to the extent provided in this Resolution. The Municipal Bonds Payments, the Municipal Bonds, and other monies, securities, funds and property so pledged are and will be free and clear of any ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 42 pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with, the pledge created by this Resolution, except for the liens in favor of the Trustee and Paying Agents provided in Section 805 hereof, and all corporate or other action on the part of the Bank to that end has been duly and will be duly and validly taken. The Bonds and the provisions of this Resolution are and will be the valid and legally enforceable obligations of the Bank in accordance with their terms. The Bank shall at all times, to the extent permitted by law, defend, preserve and protect the pledge of the Municipal Bonds Payments, the Municipal Bonds and other monies, securities, funds and property pledged under this Resolution and all the rights of the Bondholders under this Resolution against all claims and demands of all persons whomsoever. Section 906 - General Covenants of the Bank. (A) The Bank shall do and perform or cause to be done and performed all acts and things required to be done or performed by or on behalf of the Bank under law and this Resolution in accordance with the terms hereof. (B) Upon the date of issuance of any of the Bonds, all conditions, acts and things required by law and this Resolution to exist, to have happened and to have been performed precedent to and in the issuance of such Bonds shall exist, have happened and have been performed and the issue of such Bonds, together with all other indebtedness of the Bank, shall be within every debt and other limit prescribed by the laws of the State. (C) The Bank does hereby pledge to and agree with the Holders of the Bonds that it will not cause the State to limit or alter the rights vested by the Act in the Bank to fulfill the terms of any agreements made with Bondholders, or in any way impair the rights and remedies of such Holders until the Bonds, together with the interest thereon, with interest on any unpaid installments of interest, and all costs and expenses in connection with any action or proceeding by or on behalf of such Holders, are fully met and discharged. (D) Upon failure of a Governmental Unit to make any principal or interest payment on the date specified in, and as required by, the applicable Loan Agreement securing payment of the Municipal Bonds, the Trustee shall immediately notify the Executive Director of the Bank who shall then take the following actions: (i) the Executive Director shall within two days of the Governmental Unit's failure to make the Municipal Bonds Payment pursuant to the terms of the applicable Loan Agreement, contact such Governmental Unit and request payment; (ii) in the event payment is not made by the Governmental Unit pursuant to (i) above, the Trustee shall make up such deficiencies from the Reserve Fund as provided for in Section 603(E) of this Resolution; (iii) in the event payment is not made by the Governmental Unit pursuant to (i) above, and the Reserve ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 43 Fund is drawn upon to make up such deficiency pursuant to (ii) above, the Executive Director shall initiate intercept proceedings with the applicable State agencies pursuant to Section 917 of this Resolution; (iv) in the event amounts collected pursuant to (iii) above are insufficient to replenish amounts held in the Reserve Fund to the Reserve Fund Requirement, the Executive Director shall contact the Governor of the State and the State legislature as set forth in Section 911(B) of this Resolution; and (v) if there remains a deficiency in the Reserve Fund after the Executive Director has exhausted the requirements found in (i) through (iv) above, the Executive Director shall request a loan from the Department of Revenue pursuant to AS 44.85.270(i) and provide for such loan to be used to cause the amount in the Reserve Fund to satisfy the Reserve Fund Requirement. Section 907 - Accounts and Reports. (A) The Bank shall keep, or cause to be kept, proper books of record and account in which complete and correct entries shall be made of its transactions relating to all Municipal Bonds Payments, Municipal Bonds, the Fees and Charges and all funds and accounts established by this Resolution, which shall at all reasonable times be subject to the inspection of the Trustee or the Holders of an aggregate of not less than twenty-five per centum (25%) in principal amount of Bonds then Outstanding or their representatives duly authorized in writing. (B) The Bank shall annually, on or before the last day of January in each year, file with the Trustee a copy of an audit for the preceding Fiscal Year, accompanied by an Accountant's Certificate, and an annual report setting forth in complete and reasonable detail: (a) its operations and accomplishments; (b) its receipts and expenditures during such Fiscal Year in accordance with the categories or classifications established by the Bank for its operating and capital outlay purposes; (c) its assets and liabilities at the end of such Fiscal Year, including a schedule of its Municipal Bonds Payments, Municipal Bonds, Fees and Charges and the status of reserve, funds and the funds and accounts established by this Resolution; and (d) a schedule of its Bonds Outstanding and other obligations outstanding at the end of such Fiscal Year, together with a statement of the amounts paid, redeemed and issued during such Fiscal Year. A copy of each such annual report and Accountant's Certificate shall be mailed promptly thereafter by the Trustee to each Bondholder who shall have filed his name and address with the Bank for such purpose. Section 908 - Personnel and Servicing of Programs. (A) The Bank shall at all times appoint, retain and employ competent personnel for the purpose of carrying out its respective programs and shall establish and enforce reasonable rules, regulations, tests and standards governing the employment of such ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 44 personnel at reasonable compensation, salaries, fees and charges and all persons employed by the Bank shall be qualified for their respective positions. (B) The Bank may pay to the respective State agency, governmental unit or political subdivision of the State from the Operating Fund such amounts as are necessary to reimburse the respective State agency, governmental unit or political subdivision of the state for the reasonable costs of any services performed for the Bank. Section 909 - Waiver of Laws. The Bank shall not at any time insist upon or plead in any manner whatsoever, or claim or take the benefit or advantage of any stay or extension law now or at any time hereafter in force which may affect the covenants and agreements contained in this Resolution or in any Series Resolution or in the Bonds, and all benefit or advantage of any such law or laws is hereby expressly waived by the Bank. Section 910 - Fees and Charges. The Bank shall establish, make, maintain and charge such Fees and Charges to each Governmental Unit to which a Loan is made, and shall from time to time revise such Fees and Charges whenever necessary, so that such Fees and Charges actually collected from each such Governmental Unit will at all times produce monies which, together with such Governmental Unit's Allocable Proportion of other monies available under the provisions of this Resolution, and other monies available therefor, including any grants made by the United States of America or any agency or instrumentality thereof or by the State or any agency or instrumentality thereof and amounts applied therefor from amounts transferred to the Operating Fund pursuant to paragraph (3) of Section 603, will be at least sufficient: (a) To pay, as the same become due, the Governmental Unit's Allocable Proportion of the Administrative Expenses of the Bank; and (b) To pay, as the same become due, the Governmental Unit's Allocable Proportion of the fees and expenses of the Trustee and Paying Agents. The Bank shall provide the Trustee with a schedule of the Fees and Charges to be paid by each Governmental Unit, and of each revision thereof, and shall require each Governmental Unit to make payment of the Fees and Charges required to be paid by it directly to the Trustee. The Trustee shall promptly advise the Bank of each and every failure of a Governmental Unit to make payment of Fees and Charges when due in accordance with the applicable schedule. Section 911 - Administration of Reserve Fund. (A) The Bank shall establish and maintain the Reserve Fund in accordance with the provisions of this Resolution. All monies and securities held in the Reserve Fund shall be used, disbursed and applied only in accordance with the provisions of this Resolution and for no other purpose. Monies and securities held in the Reserve Fund shall not be withdrawn therefrom at any time in such amount as would reduce the amount in such Fund to an amount less than the F-12 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 45 Required Debt Service Reserve except as otherwise provided in this Resolution. (B) The Bank shall cause the Chairman of the Board of Directors of the Bank annually, before each January 30, to make and deliver to the Governor of the State and to the legislature his certificate stating the amount, if any, required to restore the Alaska Municipal Bond Bank Reserve Fund to the amount of the Required Debt Service Reserve and a copy of such certificate shall be promptly delivered by the Bank to the Trustee. Monies received by the Bank from the State pursuant to such a certification, in accordance with the provisions of Section 44.85.270(g) of the Act shall, to the extent such certification was occasioned by the fact that the amount in the Reserve Fund was less than the Required Debt Service Reserve, be deposited in the Reserve Fund, as required by paragraph (D) of Section 603. (C) The Bank shall annually submit to the State a budget request for an appropriation to cause, if necessary, amounts held in the Reserve Fund to equal the Reserve Fund Requirement. (Amendment: Effective August 19, 2009) Section 912 - Issuance of Additional Obligations. (A) The Bank shall not subsequent to the issuance of the initial Series of Bonds under this Resolution create or permit the creation of or issue any obligations or create any additional indebtedness which will be secured by a charge and lien on the Municipal Bonds and the Municipal Bonds Payments or which will be payable from the Debt Service Fund or the Reserve Fund, except that additional Series of Bonds may be issued from time to time pursuant to a Series Resolution subsequent to the issuance of the initial Series of Bonds under this Resolution on a parity with the Bonds of such initial Series of Bonds and secured by an equal charge and lien on the Municipal Bonds and the Municipal Bonds Payments and payable equally and ratably from the Debt Service Fund and Reserve Fund for the purposes of (i) making Loans to Governmental Units, (ii) making payments into the Interest Account, (iii) making payments into the Reserve Fund, (iv) funding of Notes theretofore issued by the Bank for any purposes for which Bonds may have been issued, and (v) subject to the provisions and limitations of Section 203, the refunding of any Bonds then Outstanding, under the conditions and subject to the limitations in this Section 912 provided. (B) No additional Series of Bonds shall be issued subsequent to the issuance of the initial Series of Bonds under this Resolution unless: (1) the aggregate principal amount of Bonds and Notes of the Bank outstanding at the time of issuance and delivery of such additional Bonds including the principal amount of such additional Bonds will not exceed any limit thereon imposed by law; (2) there is at the time of the issuance of such additional Bonds no deficiency in the amounts required by this Resolution or any Series Resolution to be paid into the Debt Service Fund and into the Reserve Fund; ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 46 (3) the amount of the Reserve Fund, upon the issuance and delivery of such additional Bonds and the deposit in the Reserve Fund of any amount provided therefor in the Series Resolution authorizing the issuance of such additional Bonds, shall not be less than the Required Debt Service Reserve; and (4) the maturities of, or Sinking Fund Installments for, the additional Bonds then being issued representing Loan Obligations, unless such additional Bonds are being issued to refund Outstanding Bonds in accordance with the provisions of Section 203, shall be equal to the scheduled Municipal Bonds Principal Payments to be made in respect of the Loans with respect to which such additional Bonds are to be issued. (C) The Bank expressly reserves the right to adopt one or more other general obligation bond resolutions and reserves the right to issue Notes and any other obligations so long as the same are not a charge or lien on the Municipal Bonds, the Municipal Bonds Payments and the Fees and Charges or payable from the Debt Service Fund or the Reserve Fund created pursuant to this Resolution. Section 913 - Loan Agreement Provisions. No Loan shall be made by the Bank from the proceeds of the sale of Bonds, and no Bonds shall be issued by the Bank for the purpose of providing funds with which to make a Loan, unless the Loan Agreement under which such Loan is to be made shall comply with, and no Bonds shall be issued by the Bank to fund Notes or to refund Bonds unless the Loan Agreement under which the Loan was made from the proceeds of such Notes or Bonds, shall also comply with, the following terms, conditions, provisions and limitations: (a) The Governmental Unit which is a party to such Loan agreement must be a Governmental Unit as defined by the Resolution and the Loan Agreement must be executed in accordance with existing laws; (b) The Governmental Unit, prior to or simultaneously with the issuance of Bonds of the Bank issued to make a Loan to the Governmental Unit, shall issue Municipal Bonds which are valid obligations of the Governmental Unit as required by the Act; (c) The Municipal Bonds Interest Payments to be made by the Governmental Unit under such Loan Agreement shall be not less than the interest payments the Bank is required to make on the Loan Obligation and shall be scheduled by the Bank in such manner and at such times (notwithstanding the dates of payment as stated in the Municipal Bonds) as to provide funds sufficient to pay interest on the Loan Obligation as the same becomes due; (d) The Municipal Bonds Principal Payments to be made by the Governmental Unit under such Loan Agreement shall be scheduled by the Bank in such manner and at such times (notwithstanding the dates of payment as stated in the Municipal Bonds) as to provide funds sufficient to pay the principal of the Loan Obligation as the same matures; ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 47 (e) The Governmental Unit shall be obligated to pay Fees and Charges to the Bank at the times and in the amounts which will enable the Bank to comply with the provisions of Section 910; (f) The Governmental Unit shall agree that in the event the amounts referred to in paragraphs (c) and (d) are not paid by it to the Bank on or before the times specified in the Loan Agreement, any money payable to the Governmental Unit by any department or agency of the State shall be withheld from such Governmental Unit and paid over directly to the Trustee acting under the General Obligation Bond Resolution and that the said agreement shall be full warrant, authority and direction to make such payment to any official of the State responsible for such payment upon notice to such official by the Bank as provided in the Act: (g) The Bank shall not sell and the Governmental Unit shall not redeem prior to maturity any of the Municipal Bonds with respect to which the Loan is made in an amount greater than the Outstanding Bonds issued with respect to such Loan which are then redeemable, and in the event of any such sale or redemption of such Municipal Bonds, the same shall be in an amount not less than the aggregate of (i) the principal amount of the Loan Obligation so to be redeemed, (ii) the interest to accrue on the Loan Obligation so to be redeemed to the next redemption date thereof not previously paid, (iii) the applicable premium, if any, payable on the Loan Obligation so to be redeemed, and (iv) the costs and expenses of the Bank in effecting the redemption of the Loan Obligation so to be redeemed; provided, however, that in the event the Loan Obligation has been refunded and the Refunding Bonds therefor were issued in a principal amount in excess of or less than the Loan Obligation remaining unpaid at the date of issuance of such Refunding Bonds, the amount which the Governmental Unit shall be obligated to pay or the Bank shall receive under item (i) above shall be the principal amount of such Refunding Bonds Outstanding. In the event the Loan Obligation has been refunded and the interest the Bank is required to pay on the Refunding Bonds therefor is less than the interest that the Bank was required to pay on the Loan Obligation, the amount which the Governmental Unit shall be obligated to pay or the Bank shall receive under item (ii) above shall be the amount of interest to accrue on such Refunding Bonds Outstanding. (h) The Governmental Unit shall give the Bank at least fifty (50) days' notice of intention to redeem its Municipal Bonds. Section 914 - Modification of Loan Agreement Terms. The Bank shall not consent to the modification of, or modify, the rate or rates of interest of, or the amount or time of payment of any installment of principal of or interest on any Municipal Bonds evidencing a Loan, or the amount or time of payment of any Fees and Charges payable with respect to such Loan, or the security for or any terms or provisions of such Loan or the Municipal Bonds evidencing the same, in a manner which adversely affects or diminishes the rights of the Bondholders; provided, however, that, in the event the Loan Obligation is being or has been refunded and ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 48 the Refunding Bonds therefor are in a principal amount in excess of or less than the principal amount of the Bonds refunded, the Bank may consent to the modification of and modify the Loan agreement relating to such Loan and the Municipal Bonds evidencing the same, and the Municipal Bonds Payments to be made thereunder so long as such Municipal Bonds Payments are sufficient in amount and payable at the times required for the payment of the principal of and interest on such Refunding Bonds, and further provided, however, that, in the event the Loan Obligation has been refunded and the interest the Bank is required to pay on the Refunding Bonds issued for the purpose of refunding such original Bonds is less than the interest the Bank was required to pay on such original Bonds refunded by the Bank, the Municipal Bonds Interest Payments to be made by the Governmental Unit in respect of such Loan may be reduced so that the amounts required to be paid shall be sufficient to pay interest on such Refunding Bonds Outstanding. Section 915 - Sale of Municipal Bonds by Bank. The Bank shall not sell any Municipal Bonds except as provided in subsection (g) of Section 913. Section 916 - Disposition of the Proceeds of Sale or Redemption of Municipal Bonds. In the event Municipal Bonds or other obligations securing a Loan shall be sold by the Bank or redeemed by the Governmental Unit in accordance with terms of the applicable Loan Agreement, the Bank shall, upon such sale by the Bank or redemption by the Governmental Unit, deposit the proceeds of such sale or redemption, except an amount thereof equal to the costs and expenses of the Bank in effecting the redemption of the Bonds to be redeemed, into the applicable sub-account or sub-accounts in the Redemption Account and shall apply the same to the purchase, retirement or redemption of the appropriate Bonds in accordance with the provisions of this Resolution. The balance in such applicable sub-account or sub-accounts of such proceeds of sale or redemption of Municipal Bonds after the redemption of the Bonds to be redeemed shall be deposited in the Operating Fund. Section 917 - Enforcement of Municipal Bonds. The Bank shall diligently enforce, and take all reasonable steps, actions and proceedings necessary for the enforcement of, all terms, covenants and conditions of all Loan Agreements and the Municipal Bonds evidencing Loans made by the Bank, including the prompt collection, and the giving of notice to the Commissioner of Revenue, Commissioner of Commerce, Community and Economic Development and the Commissioner of Administration and any other department or agency of the State which is custodian of any money payable to the Governmental Unit of any failure or default of the Governmental Unit in the payment of its Municipal Bonds Payment and shall promptly transfer any such monies, upon receipt thereof, to the Trustee and, in such event, or if such monies are paid directly to the Trustee, the Trustee shall deposit any such monies in the Principal Account and Interest Account in place of said unpaid Municipal Bonds Payment or in the event deficiencies in said Accounts created by such default shall have F-13 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 49 been made up by the Reserve Fund pursuant to paragraph (5) of Section 603, in the Reserve Fund to the extent of such deficiencies. Section 918 - Continuing Disclosure; Bankruptcy. (A) The Bank hereby covenants and agrees that it will comply with and carry out all the provisions of each Continuing Disclosure Certificate. Notwithstanding any other provision of this Resolution, failure of the Bank to comply with any Continuing Disclosure Certificate shall not be considered an Event of Default, and any Bondholder may take such actions only as may be provided in such Continuing Disclosure Certificate. (B) The Bank hereby covenants and agrees that it will notify the Rating Agencies then rating the Bonds of any change in the Act which would permit it or require it to declare bankruptcy under the Bankruptcy Code. Section 919 - Tax Covenants. The Bank shall not knowingly take or cause any action to be taken which would cause interest on any Bonds to become taxable for federal income tax purposes. The Bank shall at all times do and perform all acts and things necessary or desirable, including, but not limited to, complying with the rebate provisions of Section 148 of the Code, as applicable, and complying with the provisions of any letter of instructions from bond counsel, in order to assure that interest paid on Bonds shall, for purposes of federal income taxation, be excludable from the gross income of the recipients thereof and exempt from taxation. The Bank shall not permit at any time or times any proceeds of any Bonds or any amounts held hereunder to be used, directly or indirectly, in a manner which would result in the exclusion of any Bond from the treatment afforded by subsection (a) of Section 103 of the Code. ARTICLE X SERIES RESOLUTION AND SUPPLEMENTAL RESOLUTIONS Section 1001 - Modification and Amendment without Consent. Notwithstanding any other provisions of this Article X, or Article XI, the Bank may adopt at any time or from time to time Series Resolutions or Supplemental Resolutions for any one or more of the following purposes, and any such Series Resolution or Supplemental Resolution shall become effective in accordance with its terms upon the filing with the Trustee of a copy thereof certified by an Authorized Officer: (A) To provide for the issuance of a Series of Bonds pursuant to the provisions of this Resolution and to specify and determine such matters and things referred to in Article II of this Resolution and to prescribe the terms and conditions pursuant to which such Bonds may be issued, paid or redeemed; (B) To add to the covenants and agreements of the Bank for the purpose of further securing the payment of the Bonds, provided such additional covenants and agreements are not contrary to or inconsistent with the covenants and agreements of the Bank contained in this Resolution; (C) To prescribe further limitations and restrictions upon the issuance of Bonds and the ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 50 incurring of indebtedness by the Bank which are not contrary to or inconsistent with the limitations and restrictions thereon theretofore in effect; (D) To surrender any right, power or privilege reserved to or conferred upon the Bank by the terms of this Resolution, provided that the surrender of such right, power or privilege is not contrary to or inconsistent with the covenants and agreements of the Bank contained in this Resolution; (E) To confirm as further assurance any pledge under and the subjection to any lien, claim or pledge created or to be created by the provisions of this Resolution of the Municipal Bonds and Municipal Bonds Payments or of any other monies, securities or funds; (F) To modify any of the provisions of this Resolution or any previously adopted Series Resolution in any other respect; provided that such modifications shall not be effective until after all Bonds of any Series of Bonds Outstanding as of the date of adoption of such Series Resolution or Supplemental Resolution shall cease to be Outstanding, and all Bonds issued under such modified resolutions shall contain a specific reference to the modifications; (G) To cure any ambiguity or defect or inconsistent provision in this Resolution or to insert such provisions clarifying matters or questions arising under this Resolution as are necessary or desirable in the event any such modifications are not contrary to or inconsistent with this Resolution as theretofore in effect. Section 1002 - Supplemental Resolutions Effective with Consent of Bondholders. The provisions of this Resolution may also be modified or amended at any time or from time to time by a Supplemental Resolution, with the consent of Bondholders in accordance with and subject to the provisions of Article XI which Supplemental Resolution, upon the filing with the Trustee of a copy thereof, certified by an Authorized Officer and upon compliance with the Article XI, shall become fully effective in accordance with its terms as provided in said Article. Section 1003 - General Provisions Relating to Series Resolutions and Supplemental Resolutions. This Resolution shall not be modified or amended in any respect except as provided in and in accordance with and subject to the provisions of this Article X and Article Xl. Nothing contained in this Article X or Article XI shall affect or limit the rights or obligations of the Bank to adopt, make, do, execute or deliver any resolution, act or other instrument pursuant to the provisions of Section 904 or the right or obligation of the Bank to execute and deliver to the Trustee or any Paying Agent any instrument which elsewhere in this Resolution it is provided or permitted to be delivered to the Trustee or any Paying Agent. A copy of every Series Resolution and Supplemental Resolution adopted by the Bank when filed with the Trustee shall be accompanied by a Counsel's Opinion stating that such Series Resolution or Supplemental Resolution has been duly and lawfully adopted in accordance with the provisions of this ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 51 Resolution, is authorized or permitted by this Resolution and is valid and binding upon the Bank and enforceable in accordance with its terms (subject, as to enforcement of remedies, to applicable bankruptcy, reorganization, insolvency, moratorium, or other laws affecting creditor's rights generally from time to time in effect). The Trustee is hereby authorized to accept delivery of a certified copy of any Series Resolution or Supplemental Resolution permitted or authorized pursuant to the provisions of this Resolution and to make all further agreements and stipulations which may be contained therein, and, in taking such action, the Trustee shall be fully protected in relying on Counsel's Opinion that such Series Resolution or Supplemental Resolution is authorized or permitted by the provisions of this Resolution. No Series Resolution or Supplemental Resolution changing, amending or modifying any of the rights or obligations of the Trustee or of any Paying Agent may be adopted by the Bank without the written consent of the Trustee or Paying Agent affected thereby. ARTICLE XI AMENDMENTS Section 1101 - Powers of Amendment. Any modification or amendment of this Resolution and of the rights and obligations of the Bank and of the Holders of the Bonds, in any particular, may be made by a Supplemental Resolution, with the written consent given as hereinafter provided in Section 1102, (a) of the Holders of at least two-thirds in principal amount of the Bonds Outstanding at the time such consent is given, or (b) in case less than all of the several Series of Bonds then Outstanding are affected by the modification or amendment, of the Holders of at least two-thirds in principal amount of the Bonds of each Series so affected and Outstanding at the time such consent is given; provided, however, that such modification or amendment shall not (i) permit a change in the terms of redemption or maturity of the principal of any Outstanding Bond or of any installment of interest thereon or Sinking Fund Installment therefor, (ii) or a reduction in the principal amount or the Redemption Price thereof or in the rate of interest thereon, or (iii) a reduction of the percentage of the Holders of which is required to effect any such modification or amendment, or (iv) permit the creation of any lien prior to or on a parity with the lien created by this Resolution (except in the manner provided by this Resolution) or deprive the Holders of the Bonds of the lien created by this Resolution, without the consent of the Holders of all the Bonds Outstanding or of the Series of Bonds affected by such modification or amendment. For the purposes of this Section, a Series shall be deemed to be affected by a modification or amendment of this Resolution if the same adversely affects or diminishes the rights of the Holders of Bonds of such Series. Section 1102 - Consent of Bondholders. (A) The Bank may at any time adopt a Supplemental Resolution making a modification or amendment permitted by the provisions of Section 1101, to take effect when and as provided in this Section. A copy of such Supplemental Resolution (or brief summary ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 52 thereof or reference thereto), together with a request to Bondholders for their consent thereto, shall be to by, or on behalf of, the Bank's to Bondholders . Such Supplemental Resolution shall not be effective unless and until there shall have been filed with the Trustee (a) the written consents of Holders of the percentages of Outstanding Bonds specified in Section 1101 and (b) a Counsel's Opinion stating that such Supplemental Resolution has been duly and lawfully adopted and filed by the Bank in accordance with the provisions of this Resolution, is authorized or permitted hereby and is valid and binding upon the Bank and enforceable in accordance with its terms, and (ii) a notice shall have been mailed as hereinafter provided in this Section. (B) The consent of a Bondholder to any modification or amendment shall be effective only if accompanied by proof of the holding, at the date of such consent, of the Bonds with respect to which such consent is given, which proof shall be such as is permitted by Section 813. A certificate or certificates by the Trustee filed with the Trustee that it has examined such proof and that such proof is sufficient in accordance with Section 813 shall be conclusive that the consents have been given by the Holders of the Bonds described in such certificate or certificates of the Trustee. Any such consent shall be binding upon the Holder of the Bonds giving such consent and upon any subsequent Holder of such Bonds and of any Bonds issued in exchange therefor (regardless of whether such subsequent Holder thereof has notice thereof) unless such consent is revoked in writing by the holder of such Bonds giving such consent or a subsequent holder thereof by filing with the Trustee, prior to the time when the written statement of the Trustee hereinafter provided for in this Section is filed, such revocation and, if such Bonds are transferable by delivery, proof that such Bonds are held by the signer of such revocation in the manner permitted by Section 813. The fact that a consent has not been revoked may likewise be proved by a certificate of the Trustee filed with the Trustee to the effect that no revocation thereof is on file with the Trustee. (C) At any time after the Holders of the required percentages of Bonds shall have filed their consents to the Supplemental Resolution, the Trustee shall make and file with the Bank and the Trustee a written statement that the Holders of such required percentages of Bonds have filed such consents. Such written statement shall be conclusive that such consents have been so filed. At any time thereafter notice, stating in substance that the Supplemental Resolution adopted by the Bank on a stated date, a copy of which is on file with the Trustee, has been consented to by the Holders of the required percentages of Bonds and will be effective as provided in this Section, may be given to Bondholders by the Bank by mailing such notice to Bondholders at least once not more than ninety days (90) after the Holders of the required percentages of Bonds shall have filed their consents to the Supplemental Resolution and the written statement of the Trustee hereinabove provided for is filed. The Bank shall file with the Trustee proof of the publication of such notice and, if the same shall have been mailed to Bondholders, of the mailing F-14 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 53 thereof. A record, consisting of the papers required or permitted by this Section to be filed with the Trustee, shall be proof of the matters therein stated. Such Supplemental Resolution making such amendment or modification shall be deemed conclusively binding upon the Bank, the Fiduciaries and the Holders of all Bonds at the expiration of forty (40) days after the filing with the Trustee of the proof of the first publication of such last mentioned notice, except in the event of a final decree of a court of competent jurisdiction setting aside such Supplemental Resolution in a legal action or equitable proceeding for purpose commenced within such forty day period; except that any Fiduciary and the Bank during such forty day period and any such further period during which any such action or proceeding may be pending shall be entitled in their absolute discretion to take such action, or to refrain from taking such action, with respect to such Supplemental Resolution as they may deem expedient. Section 1103 - Modifications by Unanimous Consent. The terms and provisions of this Resolution and the rights and obligations of the Bank and of the Holders of the Bonds may be modified or amended in any respect upon the adoption and filing with the Trustee by the Bank of a copy of a Supplemental Resolution certified by an Authorized Officer and the consent of the Holders of all of the Bonds then Outstanding, such consent to be given as provided in Section 1102, except that no notice to Bondholders either by mailing or publication shall be required provided, however, that no such modification or amendment shall change or modify any of the rights or obligations of the Trustee or Paying Agents without the filing with the Trustee of its written assent thereto in addition to the consent of Bondholders. Section 1104 - Mailing and Publication. Any provision in this Article for the mailing of a notice or other document to Bondholders shall be fully complied with if it is mailed postage prepaid only (i) to each registered owner of Bonds then Outstanding at his address, if any, appearing upon the registry books of the Bank, (ii) to each Holder of any Bond payable to bearer who shall have filed with the Trustee an address for notices, and (iii) to the Trustee. Section 1105 - Exclusion of Bonds. Bonds owned or held by or for the account of the Bank shall not be deemed Outstanding for the purpose of consent or other action or any calculation of Outstanding Bonds provided for in this Resolution, and the Bank shall not be entitled with respect to such Bonds to give any consent or take any other action provided for in this Resolution. At the time of any consent or other action taken under this Resolution, the Bank shall furnish the Trustee a certificate of an authorized Officer, upon which the Trustee may rely, describing all Bonds so to be excluded. Section 1106 - Notation on Bonds. Bonds delivered after the effective date of any action taken as in Article X or XI provided may, and if the Trustee so determines, shall, bear notation by endorsement or otherwise in form approved by the Bank and the Trustee as to such action, and in that case upon demand of the Holder of any Bond Outstanding at such effective date and upon presentation of his Bond ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 54 for such purpose at the corporate trust office of the Trustee suitable notation shall be made on such Bond by the Trustee as to any such action. If the Bank or the Trustee shall so determine, new Bonds so modified as in the opinion of the Trustee and the Bank to conform to such action shall be prepared and delivered, and upon demand of the Holder of any Bond then Outstanding shall be exchanged, without cost to such Bondholder, for Bonds of the same Series and maturity then Outstanding, upon surrender of such Bonds. ARTICLE XII DEFAULTS AND REMEDIES Section 1201 - Trustee to Exercise Powers of Statutory Trustee. The Trustee shall be and hereby is vested with all of the rights, powers and duties of a trustee appointed by Bondholders pursuant to Section 44.85.310 and 320 of the Act and the right of Bondholders to appoint a trustee pursuant to Section 44.85.310 and 320 of the Act is hereby abrogated pursuant to Section 44.85.220(18) of the Act. Section 1202 - Events of Default. Each of the following events is hereby declared an "Event of Default," that is to say; if (a) the Bank shall default in the payment of the principal or Redemption Price of, Sinking Fund Installment for, or interest on, any Bond when and as the same shall become due whether at maturity or upon call for redemption, or otherwise; or (b) the Bank shall fail or refuse to comply with the provisions of Section 44.85.270(g) of the Act, or such amounts as shall be certified by the Chair of the Bank to the Governor and to the Legislature pursuant to such provisions of the Act shall not be appropriated and paid to the Bank prior to the termination of the then current State fiscal year; or (c) the Bank shall fail or refuse to comply with the provisions of the Act, other than as provided in (b) above, or shall default in the performance or observance of any other of the covenants, agreements or conditions on its part in this Resolution, any Series Resolution, any Supplemental Resolution, or in the Bonds contained, and such failure, refusal or default shall continue for a period of forty-five (45) days after written notice thereof by the Trustee or the Holders of not less than twenty-five per centum (25%) in principal amount of the Outstanding Bonds. Provided, however, that an Event of Default shall not be deemed to exist under the provisions of this paragraph (c) upon the failure of the Bank to make and collect Fees and Charges required to be made and collected by the provisions of this Resolution or upon the failure of the Bank to enforce any obligation undertaken by a Governmental Unit pursuant to a Loan Agreement including the making of the stipulated Municipal Bonds Payment so long as the Bank may otherwise be directed by law and so long as the Bank shall be provided with monies from the State or otherwise, other than withdrawals from or reimbursements of the Reserve Fund, sufficient in amount to pay the principal of and interest on all Bonds as the ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 55 same shall become due during the period for which the Bank shall be directed by law to abstain from making and collecting such Fees and Charges and from enforcing the obligations of a Governmental Unit under the applicable Loan Agreement. Section 1203 - Remedies. (A) Upon the happening and continuance of any Event of Default specified in paragraph (a) of Section 1202, the Trustee shall proceed, or upon the happening and continuance of any Event of Default specified in paragraphs (b) and (c) of Section 1202, the Trustee may proceed, and upon the written request of the Holders of not less than twenty-five per centum (25%) in principal amount of the Outstanding Bonds shall proceed, in its own name, to protect and enforce its rights and the rights of the Bondholders by such of the following remedies, as the Trustee, being advised by counsel, shall deem most effectual to protect and enforce such rights: (1) by mandamus or other suit, action or proceeding at law or in equity, enforce all rights of the Bondholders, including the right to require the Bank to make and collect Fees and Charges and Municipal Bonds Payments adequate to carry out the covenants and agreements as to, and pledge of, such Fees and Charges and Municipal Bonds Payments, and other properties and to require the Bank to carry out any other covenant or agreement with Bondholders and to perform its duties under the Act; (2) by bringing suit upon the Bonds; (3) by action or suit in equity, require the Bank to account as if it were the trustee of an express trust for the Holders of the Bonds; (4) by action or suit in equity, enjoin any acts or things which may be unlawful or in violation of the rights of the Holders of the Bonds; (B) Upon the occurrence of an Event of Default under Section 1202(a), unless the principal of all the Bonds shall have already become due and payable, the Trustee, by notice in writing to the Bank, may, and upon the written request of the Holders of not less than a majority in aggregate principal amount of the Bonds at the time outstanding, shall, in accordance with the provisions of the Act, declare the principal of all the Bonds then outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in this Resolution or in the Bonds contained to the contrary notwithstanding. This provision, however, is subject to the condition that if, at any time after the principal of the Bonds shall have been so declared due and payable, and before any judgment or decree for the payment of the monies due shall have been obtained or entered, the Bank shall deposit with the Trustee a sum sufficient to pay all principal on the Bonds matured prior to such declaration and all matured installments of interest (if any) upon all the Bonds, with interest on such overdue installments of principal at the rate borne by the ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 56 respective Bonds, and the reasonable expenses of the Trustee, and any and all other defaults known to the Trustee (other than in the payment of principal of and interest on the Bonds due and payable solely by reason of such declaration) shall have been made good or cured to the satisfaction of the Trustee or provision deemed by the Trustee to be adequate shall have been made therefor, then, and in every such case, the Holders of at least a majority in aggregate principal amount of the Bonds then outstanding, by written notice to the Bank and to the Trustee, may, on behalf of the Holders of all of the bonds, rescind and annul such declaration and its consequences and waive such default; but no such rescission and annulment shall extend to or shall affect any subsequent default, or shall impair or exhaust any right or power consequent thereon. (C) In the enforcement of any remedy under this Resolution, the Trustee shall be entitled to sue for, enforce payment on and receive any and all amounts then or during any default becoming, and at any time remaining, due from the Bank for principal, Redemption Price, interest or otherwise, under any provision of this Resolution or a Series Resolution or of the Bonds, and unpaid, with interest on overdue payments at the rate or rates of interest specified in such Bonds, together with any and all costs and expenses of collection and of all proceedings hereunder and under such Bonds, without prejudice to any other right or remedy of the Trustee or of the Bondholders, and to recover and enforce a judgment or decree against the Bank for any portion of such amounts remaining unpaid, with interest, costs and expenses, and to collect from any monies available for such purpose, in any manner provided by law, the monies adjudged or decreed to be payable. Section 1204 - Priority of Payments After Default. During the continuance of an Event of Default, in the event that the funds held by the Trustee and Paying Agents shall be insufficient for the payment of interest and principal or Redemption Price then due on the Bonds, such funds (other than funds held for the payment or redemption of particular Bonds which have theretofore become due at maturity or by call for redemption) and any other monies received or collected by the Trustee acting pursuant to the Act and this Article XII, after making provision for the payment of any expenses necessary in the opinion of the Trustee to protect the interests of the Holders of the Bonds, and for the payment of the charges and expenses and liabilities incurred and advances made by the Trustee or any Paying Agents in the performance of their respective duties under this Resolution, shall be applied as follows: (a) Unless the principal of all of the Bonds shall have become or have been declared due and payable, FIRST: To the payment to the persons entitled thereto of all installments of interest then due in the order of the maturity of such installments, together with interest on overdue installments of interest and, if the amount available shall not be sufficient to pay in full any installment, F-15 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 57 then to the payment thereof ratably, according to the amounts due on such installment, to the persons entitled thereto, without any discrimination or preference; and SECOND: To the payment to the persons entitled thereto of the unpaid principal or Redemption Price of any Bonds which shall have become due, whether at maturity or by call for redemption, in the order of their due dates and, if the amounts available shall not be sufficient to pay in full all the Bonds due on any date, then to the payment thereof ratably, according to the amounts of principal or Redemption Price due on such date, to the persons entitled thereto, without any discrimination or preference. (b) If the principal of all of the Bonds shall have become or have been declared due and payable, to the payment of the principal and interest then due and unpaid upon the Bonds together with interest on overdue installments of interest without preference or priority of principal over interest or of interest over principal, or of any installment of interest over any other installment of interest, or of any Bond over any other Bond, ratably, according to the amounts due respectively for principal and interest, to the persons entitled thereto without any discrimination or preference except as to any difference in the respective rates of interest specified in the Bonds. Whenever monies are to be applied by the Trustee pursuant to the provisions of this Section 1204, such monies shall be applied by the Trustee at such times, and from time to time, as the Trustee in its sole discretion shall determine, having due regard to the amount of such monies available for application and the likelihood of additional money becoming available for such application in the future; the deposit of such monies with the Paying Agents, or otherwise setting aside such monies in trust for the proper purpose, shall constitute proper application by the Trustee; and the Trustee shall incur no liability whatsoever to the Bank, to any Bondholder or to any other person for any delay in applying any such monies, so long as the Trustee acts with reasonable diligence, having due regard for the circumstances, and ultimately applies the same in accordance with such provisions of this Resolution as may be applicable at the time of application by the Trustee. Whenever the Trustee shall exercise such discretion in applying such monies, it shall fix the date (which shall be an interest payment date unless the Trustee shall deem another date more suitable) upon which such application is to be made and upon such date interest on the amounts of principal to be paid on such date shall cease to accrue. The Trustee shall give such notice as it may deem appropriate for the fixing of any such date. The Trustee shall not be required to make payment to the Holder of any unpaid Bond unless such Bond shall be presented to the Trustee for appropriate endorsement or for cancellation if fully paid. Interest on overdue installments of interest shall ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 58 be equal to the rate on the Bond as to which the interest installment is overdue. The provisions of this Section 1204 are in all respects subject to the provisions of Section 902. Section 1205 - Termination of Proceedings. In case any proceeding taken by the Trustee on account of any Event of Default shall have been discontinued or abandoned for any reason, then in every such case the Bank, the Trustee and the Bondholders shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies, powers and duties of the Trustee shall continue as though no such proceeding had been taken. Section 1206 - Bondholders' Direction of Proceedings. Anything in this Resolution to the contrary notwithstanding, the Holders of the majority in principal amount of the Bonds then Outstanding shall have the right by an instrument or concurrent instruments in writing executed and delivered to the Trustee, to direct the method of conducting all remedial proceedings to be taken by the Trustee hereunder, provided that such direction shall not be otherwise then in accordance with law or the provisions of this Resolution, and that the Trustee shall have the right to decline to following any such direction which in the opinion of the Trustee would be unjustly prejudicial to Bondholders not parties to such direction. Section 1207 - Limitation on Rights of Bondholders. No Holder of any Bond shall have any right to institute any suit, action, mandamus or other proceeding in equity or at law hereunder, or for the protection or enforcement of any right under this Resolution or any right under law unless such Holder shall have given to the Trustee written notice of the event of default or breach of duty on account of which such suit, action or proceeding is to be taken, and unless the Holders of not less than twenty- five per centum (25%) in principal amount of the Bonds then Outstanding shall have made written request of the Trustee after the right to exercise such powers or right of action, as the case may be, shall have occurred, and shall have afforded the Trustee a reasonable opportunity either to proceed to exercise the powers herein granted or granted under the law or to institute such action, suit or proceeding in its name and unless, also, there shall have been offered to the Trustee reasonable security and indemnity against the costs, expenses and liabilities to be incurred therein or thereby and the Trustee shall have refused or neglected to comply with such request within a reasonable time; and such notification, request and offer of indemnity are hereby declared in every such case, at the option of the Trustee, to be conditions precedent to the execution of the powers under this Resolution or for any other remedy hereunder or under law. It is understood and intended that no one or more Holders of the Bonds hereby secured shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security of this Resolution, or to enforce any right hereunder or under law with respect to the Bonds or this Resolution, except in the manner herein provided, and that all proceedings at law or in equity shall be instituted, had and maintained in the manner ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 59 herein provided and for the benefit of all Holders of the Outstanding Bonds. Notwithstanding the foregoing provisions of this Section or any other provisions of this Article XII, the obligation of the Bank shall be absolute and unconditional to pay the principal or Redemption Price of and interest on the Bonds to the respective Holders thereof at the respective due dates thereof, and nothing herein shall affect or impair the right of action, which is absolute and unconditional, of such Holders to enforce such payment. Section 1208 - Possession of Bonds by Trustee Not Required. All rights of action under this Resolution or under any of the Bonds, enforceable by the Trustee, may be enforced by it without the possession of any of the Bonds or the production thereof on the trial or other proceeding relative thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in its name for the benefit of all the Holders of such Bonds, subject to the provisions of this Resolution. Section 1209 - Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee or to the Holders of the Bonds is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative and shall be in addition to any other remedy given hereunder or now or hereafter existing at law or in equity, or by statute. Section 1210 - No Waiver of Default. No delay or omission of the Trustee or of any Holder of the Bonds to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy given by this Resolution to the Trustee and the Holders of the Bonds, respectively, may be exercised from time to time and as often as may be deemed expedient. Section 1211 - Notice of Event of Default. The Trustee shall give to the Bondholders notice of each Event of Default hereunder known to the Trustee within ninety (90) days after knowledge of the occurrence thereof, unless such Event of Default shall have been remedied or cured before the giving of such notice; provided that, except in the case of default in the payment of the principal or Redemption Price of or interest on any of the Bonds, or in the making of any payment required to be made into the Debt Service Fund or the Reserve Fund, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors or responsible officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Bondholders. Each such notice of Event of Default shall be given by the Trustee by mailing written notice thereof: (1) to all registered Holders of Bonds, as the names and addresses of such Holders appear upon the books for registration and transfer of Bonds as kept by the Trustee; (2) to such Bondholders as have filed their names and addresses with the Trustee for that purpose; and (3) to such other persons as is required by law. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 60 ARTICLE XIII DEFEASANCE Section 1301 - Defeasance. (A) If the Bank shall pay or cause to be paid to the Holders of the Bonds, the principal and interest and Redemption Price, if any, to become due thereon, at the times and in the manner stipulated therein and in this Resolution, and also shall pay or cause to be paid all other sums payable hereunder by the Bank, including any amounts payable to the United States, then the pledge of any revenues and assets hereby pledged and all other rights granted hereby shall, at the election of the Bank (evidenced by a certificate of an Authorized Officer filed with the Trustee, signifying the intention of the Bank to discharge all such indebtedness and this Resolution and any Supplemental Resolution), and notwithstanding that any Bonds shall not have been surrendered for payment, be discharged and satisfied. In such event, the Trustee shall, upon the written request of the Bank, execute and deliver to the Bank all such instruments as may be desirable to evidence such discharge and satisfaction and the Fiduciaries shall pay over or deliver to the Bank all moneys or securities held by them pursuant to this Resolution which are not required for the payment or redemption of Bonds not theretofore surrendered for such payment or redemption. (B) If funds shall have been set aside and shall be held in trust by Fiduciaries for the payment of principal, interest and Redemption Price (through deposit by the Bank of funds for such payment or redemption or otherwise) at the maturity or upon the date upon which such Bonds have been duly called for redemption thereof, such Bonds shall be deemed to have been paid within the meaning and with the effect expressed in subsection (A) of this Section. All Outstanding Bonds shall, prior to the maturity or redemption date thereof, be deemed to have been paid within the meaning and with the effect expressed in subsection (A) of this Section if (i) in case any of said Bonds are to be redeemed on any date prior to their maturity, the Bank shall have given to the Trustee in form satisfactory to it irrevocable instructions to publish as provided in Article IV notice of redemption on said date of such Bonds, (ii) there shall have been deposited with the Trustee either funds in an amount which shall be sufficient, or Investment Securities which are not subject to redemption prior to the dates on which amounts will be needed to make payments on the Bonds defeased and the principal of and the interest on which when due will provide moneys which, together with the moneys, if any, deposited with the Trustee at the same time, shall be sufficient in the opinion of an Accountant delivered to the Trustee, to pay when due the principal or Redemption Price, if any, and interest due and to become due on said Bonds on any date prior to the redemption date or maturity date thereof, as the case may be, (iii) in the event said Bonds are not by their terms subject to redemption within the next succeeding sixty (60) days, the Bank shall have given the Trustee in form satisfactory to it irrevocable instructions to mail a notice to the Holders of such Bonds that the deposit required by (ii) above has been made with the Trustee and that said Bonds are deemed to have been paid in accordance with this Section and stating F-16 ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 61 such maturity or redemption date upon which moneys are to be available for the payment of the principal or Redemption Price, if any, of said Bonds and (iv) a Counsel's Opinion stating that all conditions precedent to the satisfaction and discharge of this Resolution have been complied with, the defeasance complies with the terms of this Resolution, and the defeasance will not adversely affect the tax status of the Bonds. Neither Investment Securities or moneys deposited with the Trustee pursuant to this Section nor principal or interest payments on any such Investment Securities shall be withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the principal or Redemption Price, if any, of and interest on said Bonds; provided that any cash received from such principal or interest payments on such Investment Securities deposited with the Trustee, if not then needed for such purpose, shall, to the extent practicable, be reinvested in Investment Securities maturing at times and in amounts sufficient to pay when due the principal or Redemption Price, if any, and interest to become due on said Bonds on and prior to such redemption date or maturity date thereof, as the case may be, and interest earned from such reinvestments shall be paid over to the Bank, as received by the Trustee, free and clear of any trust, lien or pledge. (C) If, through the deposit of moneys by the Bank or otherwise, the Fiduciaries shall hold, pursuant to this Resolution, moneys sufficient to pay the principal and interest to maturity on all Outstanding Bonds or to pay, in the case of Bonds in respect of which the Bank shall have taken all action necessary to redeem prior to maturity, the Redemption Price and interest to such redemption date, then at the written request of the Bank all moneys held by any Paying Agent shall be paid over to the Trustee and, together with other moneys held by it hereunder, shall be held by the Trustee for the payment or redemption of Outstanding Bonds. (D) Anything in this Resolution to the contrary notwithstanding, any moneys held by a Fiduciary in trust for the payment and discharge of any of the Bonds which remain unclaimed for one year after the date when all of the Bonds have become due and payable, either at their stated maturity dates or by call for earlier redemption, if such moneys were held by the Fiduciary at such date, or for one year after the date of deposit of such moneys if deposited with the Fiduciary after the said date when all of the Bonds became due and payable, shall be repaid by the Fiduciary to the Bank, as its absolute property and free from trust, and the Fiduciary shall thereupon be released and discharged. (E) The references in this section to "Investment Securities described in clause (1) of the definition thereof" shall include only direct and general obligations of the United States which are not-callable prior to the scheduled maturity in the related escrow deposit agreement where the Outstanding Bonds to be deemed to be paid upon the deposit thereof are insured by a municipal bond insurance company licensed and authorized to issue the policy in the State. ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 62 ARTICLE XIV MISCELLANEOUS Section 1401 - Preservation and Inspection of Documents. All documents received by the Trustee or any Paying Agent under the provisions of this Resolution or any Series Resolution shall be retained in its possession and shall be subject at all reasonable times to the inspection of the Bank, the Trustee or any Paying Agent and, after written request received by the Trustee at least five business days prior to the date of inspection, by any Holder of five percent in principal amount of any Series of Outstanding Bonds, and their agents and representatives, any of whom may make copies thereof. Section 1402 - Parties of Interest. Nothing in this Resolution or in any Series Resolution adopted pursuant to the provisions hereof, expressed or implied, is intended to or shall be construed to confer upon or to give to any person or party other than the Bank, Trustee, Paying Agents and the Holders of the Bonds, remedies or claims under or by reason of this Resolution or any Series Resolution or any covenants, conditions or stipulations thereof; and all covenants, stipulations, promises and agreements in this Resolution and any Series Resolution contained by or on behalf of the Bank shall be for the sole and exclusive benefit of the Bank, Trustee and Paying Agents and the Holders from time to time of the Bonds. Section 1403 - No Recourse Under Resolution or on Bonds. All covenants, stipulations, promises, agreements and obligations of the Bank contained in this Resolution shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Bank and not of any member, officer or employee of the Bank in his individual capacity, and no recourse shall be had for the payment of the principal or Redemption price of or interest on the Bonds or for any claim based thereon or on this Resolution against any member, officer or employee of the Bank or any natural person executing the Bond. Section 1404 - Severability. If any one or more of the covenants, stipulations, promises, agreements or obligations, provided in this Resolution on the part of the Bank, Trustee or any Paying Agent to be performed should be determined by a court of competent jurisdiction to be contrary to law, then such covenant or covenants, stipulation or stipulations, promise or promises, agreement or agreements, obligation or obligations shall be deemed and construed to be severable from the remaining covenants, stipulations, promises, agreements and obligations herein contained and shall in no way affect the validity of the other provisions of this Resolution. Section 1405 - Headings. Any headings preceding the texts of the several Articles and Sections hereof, and any table of contents or marginal notes appended to copies hereof, shall be solely for convenience of reference and shall not constitute a part of this Resolution, nor shall they affect its meaning, construction or effect. Section 1406 - Conflict. All resolutions or parts of resolutions or other proceedings of ALAKSA MUNICPAL BOND BANK General Obligation Bond Resolution (Amended) Page 63 the Bank in conflict herewith be and the same are repealed insofar as such conflict exists. Section 1407 - Governing Law. This Resolution and the Bonds shall be construed in accordance with, and governed by, the laws of the State of Alaska. Section 1408 - Effective Date. This Resolution shall take effect immediately upon its adoption. [THIS PAGE INTENTIONALLY LEFT BLANK] F-17 F-18 F-19 [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX G Proposed Form of Continuing Disclosure Certificate [THIS PAGE INTENTIONALLY LEFT BLANK] G-1 APPENDIX G PROPOSED FORM OF CONTINUING DISCLOSURE CERTIFICATE Alaska Municipal Bond Bank (the “Issuer”) executes and delivers this Continuing Disclosure Certificate (the “Disclosure Certificate”) in connection with the issuance of $33,015,000 Alaska Municipal Bond Bank General Obligation and Refunding Bonds, 2016 Series One (the “Bonds”). The Bonds are being issued under the General Bond Resolution of the Bank entitled “A Resolution Creating And Establishing An Issue Of Bonds Of The Alaska Municipal Bond Bank; Providing For The Issuance From Time To Time Of Said Bonds; Providing For The Payment Of Principal Of And Interest On Said Bonds; And Providing For The Rights Of The Holders Thereof,” adopted July 13, 2005, as amended (the “General Bond Resolution”), and Series Resolution No. 2015-05 adopted on December 15, 2015 (the “Series Resolution,” and together with the General Bond Resolution, the “Resolutions”). The Issuer covenants and agrees as follows: Section 1. Purpose of the Disclosure Certificate. The Issuer is executing and delivering this Disclosure Certificate for the benefit of the Beneficial Owners of the Bonds, and to assist the Participating Underwriter in complying with Securities and Exchange Commission 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 Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: “Annual Report” means any Annual Report provided by the Issuer pursuant to, and as described in, Section 3 of this Disclosure Certificate. “Fiscal Year” means the fiscal year of the Issuer (currently the 12-month period ending June 30), as such fiscal year may be changed from time to time as required by State law. “MSRB” means the Municipal Securities Rulemaking Board. “Participating Underwriter” means any of the original underwriters of the Bonds required to comply with the Rule in connection with the offering of the Bonds. “Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended from time to time. Section 3. Provision of Annual Reports and Financial Statements. Commencing with its Fiscal Year ending June 30, 2016, the Issuer will provide to the MSRB, in a format as prescribed by the Rule: (a) Not later than 210 days after the end of each Fiscal Year, an Annual Report for the Fiscal Year. The Annual Report shall contain or incorporate by reference: (i) annual audited financial statements of the Issuer; (ii) a statement of authorized, issued and outstanding bonded debt of the Issuer; (iii) the Reserve Fund balance; and (iv) statistics regarding Governmental Units similar to those found in Appendix D to the Official G-2 Statement as of the end of the prior Fiscal Year. Any or all of these items may be included by specific reference to documents available to the public or the internet website of the MSRB or filed with the Securities and Exchange Commission. The Issuer shall clearly identify each such other document so incorporated by reference. The Annual Report may be submitted as a single document or as separate documents comprising a package, provided that audited financial statements may be submitted separately from the remainder of the Annual Report. (b) Not later than 120 days after the end of each Fiscal Year, the Issuer will notify each Governmental Unit, who has, or had, an amount of bonds equal to or greater than twenty percent (20%) of all outstanding loans under the General Bond Resolution, of its continuing disclosure undertaking responsibility. A list of such Governmental Units for the prior Fiscal Year will be included in the Annual Report. Section 4. Notice of Failure to Provide Information. The Issuer shall provide in a timely manner to the MSRB notice of any failure to satisfy the requirements of Section 3 of this Disclosure Certificate. Section 5. Reporting of Significant Events. (a) The Issuer shall file with the MSRB a notice of any of the following events with respect to the Bonds, within ten (10) business days of the occurrence of such event: (1) Principal and interest payment delinquencies. (2) Unscheduled draws on debt service reserves reflecting financial difficulties. (3) Unscheduled draws on credit enhancements reflecting financial difficulties. (4) Substitution of credit or liquidity providers, or their failure to perform. (5) Adverse tax opinions or events affecting the tax-exempt status of the Bonds which include (i) the issuance by the Internal Revenue Service (“IRS”) of proposed or final determinations of taxability, (ii) Notices of Proposed Issues (IRS Form 5701-TEB), (iii) other material notices or determinations with respect to the Bonds, and (iv) other events affecting the tax status of the Bonds. (6) Defeasances. (7) Rating changes. (8) Tender offers. (9) Bankruptcy, insolvency, receivership or similar proceeding by the Issuer or “obligated person.” G-3 (b) The Issuer shall file with the MSRB a notice of any of the following events with respect to the Bonds, within ten (10) business days of the occurrence of such event, if material: (1) Nonpayment-related defaults. (2) Modifications to rights of holders of the Bonds. (3) Bond calls, other than mandatory, scheduled redemptions not otherwise contingent on the occurrence of an event. (4) Release, substitution or sale of property securing repayment of the Bonds. (5) Other than in the normal course of business, the consummation of a merger, consolidation, or acquisition involving an “obligated person,” or the sale of all or substantially all of the assets of the Issuer or “obligated person,” or the entry into a definitive agreement to undertake such an action, or a termination of a definitive agreement relating to any such actions, other than in accordance with its terms. (6) Appointment of a successor or additional trustee or the change in name of the trustee for the Bonds. Section 6. Termination of Reporting Obligation. The Issuer’s obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. Section 7. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, provided that the amendment meets each of the following conditions: (a) The amendment is made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of the Issuer; (b) This Disclosure Certificate, as amended, would have complied with the requirements of the Rule as of the date hereof, after taking into account any amendments or interpretations of the Rule, as well as any changes in circumstances; (c) The Issuer obtains an opinion of counsel unaffiliated with the Issuer that the amendment does not materially impair the interests of the Beneficial Owners of the Bonds; and (d) The Issuer notifies and provides the MSRB with copies of the opinions and amendments. Any such amendment may be adopted without the consent of any Beneficial Owner of any of the Bonds, notwithstanding any other provision of this Disclosure Certificate or the Resolutions. G-4 The first Annual Report containing amended operating data or financial information pursuant to an amendment of this Disclosure Certificate shall explain, in narrative form, the reasons for the amendment and its effect on the type of operating data and financial information being provided. Section 8. Filing Alternative. Any filing required under the terms of this Disclosure Certificate may be made solely by transmitting such filing to the Electronic Municipal Market Access as provided at http://www.emma.msrb.org, or in such other manner as may be permitted from time to time by the Securities Exchange Commission. Section 9. Default. In the event of a failure of the Issuer to comply with any provision of this Disclosure Certificate, any Beneficial Owner may take such actions as may be necessary and appropriate, including an action to compel specific performance, to cause the Issuer to comply with its obligations under this Disclosure Certificate. No failure to comply with any provision of this Disclosure Certificate shall be deemed an Event of Default under the Resolutions, and the sole remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with this Disclosure Certificate shall be an action to compel specific performance. Section 10. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the Trustee, the Participating Underwriter and the Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity. DATED this ___ day of February 2016. ALASKA MUNICIPAL BOND BANK DEVEN J. MITCHELL Executive Director APPENDIX H DTC and Book-Entry System [THIS PAGE INTENTIONALLY LEFT BLANK] DTC AND BOOK-ENTRY SYSTEM 1. The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the 2016 Series One Bonds. The 2016 Series One Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered certificate will be issued for each maturity of the 2016 Series One Bonds in the aggregate principal amount of such maturity, and will be deposited with DTC. 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 the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has a rating from Standard & Poor's of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. 3. Purchases of 2016 Series One Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the 2016 Series One Bonds on DTC's records. The ownership interest of each actual purchaser of each 2016 Series One Bond ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the 2016 Series One Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in 2016 Series One Bonds, except in the event that use of the book-entry system for the 2016 Series One Bonds is discontinued. 4. To facilitate subsequent transfers, all 2016 Series One Bonds deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of 2016 Series One Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the 2016 Series One Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such 2016 Series One Bonds are credited, H-1 which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. 5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of 2016 Series One Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the 2016 Series One Bonds, such as redemptions, tenders, defaults, and proposed amendments to the 2016 Series One Bond documents. For example, Beneficial Owners of 2016 Series One Bonds may wish to ascertain that the nominee holding the 2016 Series One Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. 6. Redemption notices shall be sent to DTC. If less than all of the 2016 Series One Bonds within a maturity are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such maturity to be redeemed. 7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to 2016 Series One Bonds unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Bond Bank 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 2016 Series One Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). 8. Payments on the 2016 Series One Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from the Bond Bank or the Trustee, on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, the Bond Bank or the Trustee, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest payments on the Bonds to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Bond Bank or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. 9. DTC may discontinue providing its services as depository with respect to the 2016 Series One Bonds at any time by giving reasonable notice to the Bond Bank or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, 2016 Series One Bond certificates are required to be printed and delivered. 10. The Bond Bank may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, 2016 Series One Bond certificates will be printed and delivered to DTC. H-2 11. The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that the Bond Bank believes to be reliable, but the Bond Bank takes no responsibility for the accuracy thereof. H-3 [THIS PAGE INTENTIONALLY LEFT BLANK] [THIS PAGE INTENTIONALLY LEFT BLANK] [THIS PAGE INTENTIONALLY LEFT BLANK] AL A S K A M U N I C I P A L B O N D B A N K Þ * (1 ( 5 $ / 2 %/ , * $ 7 , 2 1 $1 ' 5 () 8 1 ' , 1 * % 21 ' 6       6 (5 , ( 6 2 1( CONTINUING DISCLOSURE CERTIFICATE The Kodiak Island Borough Alaska the Borough executes and deliversthis Continuing Disclosure Certificate the Disclosure Certificate in connection with theissuance of $33015000 Alaska Municipal BondBank General Obligation and Refunding Bonds 2016 Series One the Bonds The Bonds are being issued under the General Bond Resolution of the Issuer entitled Resolution Creating And Establishing An Issue Of Bonds Of The Alaska Municipal Bond Bank Providing For The Issuance FromTime To Time Of Said Bonds Providing For The Payment Of Principal Of And Interest On Said Bonds And Providing For The Rights Of The Holders Thereof adopted July 132005 as amended the General Bond Resolution and the SeriesResolution No 2015-05 adopted on December 15 2015 the Series Resolution and together with the General Bond Resolution the Resolutions The Borough covenants and agrees as follows Section Purpose of the Disclosure Certificate The Borough is executing and delivering this Disclosure Certificatefor thebenefit of the Beneficial Owners of the Bonds and toassist the Participating Underwriter in complying with Securities and Exchange CommissionSECRule15c2-12b5 The Borough is currently an Obligated Person within the meaning of the Rule Section Definitions In addition tothe definitions set forthin the Resolutions which apply to any capitalized term used in this Disclosure Certificate unless otherwisedefined inthis Section the following capitalized terms shall have the following meanings Annual Report means any Annual Reportprovidedby the Borough pursuant to and as described in Section of this Disclosure Certificate Borough means the Kodiak Island Borough Alaska Fiscal Year means the fiscal year of the Borough currently the 12-month period ending June 30 as such fiscal year may be changed from time to time as required by State law and the Boroughs ordinances Issuer means the Alaska Municipal Bond Bank MSRB means the Municipal Securities Rulemaking Board Participating Underwriter means the original underwriter of the Bonds required to comply with the Rule in connection with the offering of the Bonds Rule means Rule 5c2-2b5 adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934 as amended from time to time Section Provision of Annual Reports and Financial Statements Commencing with its Fiscal Year ending June 30 2016 and for so long as the Borough has outstanding with the Issuer an amount of bonds equal to or greater than ten percent 10%of all bonds outstanding under the General Bond Resolution as of the last day of the fiscal year of the Issuer currently Page Continuing Disclosure Certificate Kodiak Island Borough June 30 the Borough will provide to the MSRB in format as prescribed by the Rule the following Not later than 210 days after the end of each Fiscal Year an Annual Report for the Fiscal Year The Annual Report shall contain or incorporate by reference the following annual financialinformation and operating data annual financial statements for the Borough prepared in accordance with generally accepted accounting principles applicable to governmental entities as such principles may be changed from time to time and ii financial information generally of the type included in Appendix of the Official Statement relating to the Bonds Any or all of these items may be incorporated by specific reference to documents available to the public on the internetwebsite of MSRB or filed with the Securities and Exchange Commission The Borough shall clearlyidentify eachsuch other document so incorporated by reference The Annual Report may be submitted as single document or as separate documents comprising packageprovided that audited financial statements of the Borough may be submitted separately from the remainder of the Annual Report If not provided as part of the Annual Report then promptly upon their public release the audited financial statements of the Borough for each Fiscal Year prepared in accordance with generally accepted accounting principles applicable to governmental entities as such principles may be changed from time to time Section Filing Requirements The Borough agrees any filing required under the terms of this Disclosure Certificate shall be with the MSRB in format prescribed by the Rule and that such filing shall be made in connection with CUSIP Nos 01179P 011798 and 01179R Additional or alternate CUSIP numbers may beadded from time to time by written notice from the Issuer to the Borough and the Borough agrees thatif it shall receive from the Issuer CUSIP numbers in addition to those set forth in this Section it shall make its filings using both the CUSIP numbers herein stated and theadditional CUSIP numbers if any Section Notice of Failure to Provide Information The Borough shall provide in timely manner to the MSRB notice of any failure to satisfy the requirements of Section of this DisclosureCertificate Section Termination of Reporting Obligation The Boroughs obligations under this Disclosure Certificate shall terminate upon the legal defeasance prior redemption or payment in full of its loan obligation with the Issuer relating to the Bonds and as otherwise described in Section of this DisclosureCertificate Section Amendment Waiver Notwithstanding any other provision of this Disclosure Certificate the Borough may amend this Disclosure Certificate provided that the amendment meets each of the following conditions Theamendment is made in connection with change in circumstances that arises from change in legal requirements change in law or change in the identity nature or status of the Borough Page Continuing DisclosureCertificate Kodiak Island Borough ThisDisclosure Certificate as amended would have complied with the requirements of the Rule as of thedate hereof after taking into account any amendments or interpretations of the Rule as well as any changes in circumstances and The Borough obtains an opinion of nationally recognized bond counsel to the effectthat the amendment will not adversely affect the Issuers compliance with the Rule or its continuing disclosure undertaking and The Borough notifies and provides the Issuer and the MSRB with the copies of the opinions and amendments Any such amendment may be adopted without theconsent of any Beneficial Owner of any of the Bonds notwithstanding any other provision of this Disclosure Certificate or the Resolutions The first Annual Report containing amended operating data or financial information pursuant to an amendment of this Disclosure Certificate shall explain in narrative form the reasons for the amendment and its effect on the type of operating data and financial information being provided Section Default In the event of failure of the Borough to comply with any provision of this Disclosure Certificate any Beneficial Owner may takesuch actions as may be necessary and appropriateincluding an action to compel specific performance to cause the Borough to comply with its obligations under this Disclosure Certificate No failure to comply with any provision of this Disclosure Certificateshall be deemed an Event of Default under the Resolutions or the Bonds and thesole legal remedy under this Disclosure Certificatein theevent of any failure of the Borough to comply with this Disclosure Certificate shall be an action to compel specific performance Section Beneficiaries ThisDisclosure Certificate shall inure solely to the benefit of the Borough the Issuer the Trustee the Participating Underwriter and theBeneficial Owners from time to time of the Bonds and shall create no rights in any other person or entity Section 10 Filing Alternative Any filing required under the terms of this Disclosure Certificate may be made solely by transmitting such filing to the Electronic Municipal Market Access as provided at http//www.emma.msrb.org or in such other manner as may be permitted from time to time by the Securities Exchange Commission Section 11 Prior Compliance The Borough is in compliance in all material respects with its prior undertakingspursuant to the Rule if any PAGE FOLLOWS Page Continuing Disclosure Certificate Kodiak Island Borough DATED this 2nd day of February 2016 KODIAK ISLAND BOROUGH ALASKA By________ Karleton Short Finance Director P4Thtl.nuing Disclosure Certificate Kodiak Island Borough TAXEXEMPTIONANDNONARBITRAGE CERTIFICATE CONCERNING KODIAK ISLAND BOROUGH ALASKA $1870000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES AND $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES Karleton Short on behalf of Kodiak Island Borough Alaska the Borough certify as follows General 1.1 Responsible Officer am the Finance Directorofthe Borough and as such am an officer of the Borough responsible for issuing the Boroughs $1870000 principal amount General Obligation School Bond 2016 Series the 2016A Bond and $5140000 principal amount General Obligation School Bond 2016 Series the 2016B Bond and together withthe 2016A Bond the 2016 Bonds dated delivered and paid for on the same date as the date of this certificate the Issue Date Pursuant to the provisions of TreasuryRegulations Section 1.150-1c4iii the Borough elects to treat the 2016ABond and the 2016B Bond as part of the same issue because all of the 2016Bonds are secured by pledge of the full faith and creditofthe Borough and all ofthe 2016Bondswere sold and are being issued on the same date 1.2 Purpose of Certificate This certificate is executed toestablish the facts estimates and circumstances in existence on the Issue Date and the bona fide reasonable expectations of the Borough on the Issue Date as to future events in connection with the 2016Bonds for the purposes ofthe applicableprovisions of the Internal Revenue Code of 1986 as amended the Code and applicable Treasury Regulations underSections 103 141 and 148-150 of the Code 1.3 Reasonable Basis for Expectations To thebest of my knowledge information and belief this certificate accurately summarizes the facts estimates and circumstances in existence on the Issue Date and the expectations of the Borough on the Issue Date about future events in connection with the 2016 Bonds are reasonable 1.4 Defined Terms Capitalized words used butnot otherwisedefined in this certificate have the meaning setforth in Resolution Nos FY2016-05 and FY2016-23 of the Borough authorizing the 2016A Bondand Resolution No FY2016-06 authorizing the 2016B Bond together the Bond Resolutions Purpose of Issuinci the 2016 Bonds 2.1 Governmental Purpose The Borough is local government unit of the State of Alaska The2016Bonds are being issued by the Borough to the Alaska Municipal BondBank the Bond Bank to evidence the obligation ofthe Borough to repay loan made by the BondBank to the Borough from the portion ofthe proceeds of the Bond Banks General Obligation and Refunding Bonds 2016 Series One allocable to the Borough the Bond Bank Bonds The BondBank is loaning the proceeds of the BondBank Bonds tothe Borough pursuant to loan agreement the Loan Agreement Pursuant to Treasury Regulations Section 1.150-1d2iiB the Borough is treated as the obligor on the Bond Bank Bonds 2016A Bond The2016A Bond is being issued for the purpose of providing thefunds necessary to finance part ofthe costs of planningdesigning and constructing school and related capital improvements in the Borough including without limitation the reconstruction and renovation of Kodiak High School referred to the regular Borough election held on October 2009 as Proposition No the 2016A Improvements and to pay costsof issuance as providedby the Bond Resolutions 2016B Bond The 2016B Bond is being issued for the purpose of providing thefunds necessary to finance the renewal and replacement schedule related to Borough-owned school facilities including without limitation those projects listed in Resolution No FY20 16-06 referredto the regular Borough electionheld on October 2014 as Proposition the 2016B Improvements and together withthe 2016A Improvements the Improvements and to pay costs of issuance as provided by the Bond Resolutions 2.2 No Impermissible Private Business Use No more than 10%$807829 of the proceeds ofthe 2016Bonds or of corresponding portion of the Improvements being financed with proceeds of the Bond will be used for any private business use No more than 5%$403914 ofthe proceeds of the 2016Bonds or of corresponding portion of the Improvements being financed with proceeds of the Bond will beused either for any private businessuse that is unrelated tothe governmentalpurpose of the 2016Bonds or for any private business use that is related to governmentalpurpose of the 2016Bonds but exceeds the amount of proceeds ofthe 2016Bonds that are expected to be used for that governmental purpose No more than 5%ofthe proceeds ofthe 2016Bonds will be used directly or indirectly to make or financeloans to any person otherthan governmental unit except loan if any whichenables the borrower to finance governmental tax or assessment of general application for specific essential governmental function or thatconstitutes nonpurpose investment within the meaning of Section 148 of the Code Source and Disbursement of Proceeds 3.1 Purchaser and Purchase Price ofthe 2016 Bonds The Borough has entered into the Loan Agreement with the Bond Bank to secure payment of the sum of $7010000.00 the Loan Amount Pursuant tothe Loan Agreement the BondBank will issue the BondBank Bonds at price equal to the Loan Amount plus an original issue premium on the BondBank Bonds of $1068296.75 less an underwriters discount on the Bond BankBonds of $36192.69 3.2 Funds Into Which ProceedsFrom the Issuance and Sale of the 2016 Bonds and the Bond Bank Bonds Will Be Deposited The proceeds received by the Borough from theissuance and sale of the 2016Bonds will be used and applied as follows $35000 will be used to pay costs of issuance of the 2016 Bonds 51496334.3 ii $1906.73 will be used to pay for the costallocable to the Borough of providing the qualified guarantee for the BondBank Bonds described in Section 6.2 iii $5197.33 representing the contingency amount an amount less than of thesale proceeds of the 2016 Bonds will be deposited in an account used primarily to achieve proper matching of revenues ofthe Borough with principal and interest payments on the 2016 Bonds the Bond Fund and used to pay interest on the 2016Bonds on August 2016 and iv $8000000 will be deposited in fundestablished by the Borough to pay costsof the Improvements the Construction Fund and used to carry out the Improvements 3.3 Cost of the 2016A Improvements The cost ofthe 2016A Improvements is estimated to be $76310000 whichcost will be paid from the proceeds ofthe issuance and saleofthe 2016A Bond reasonablyexpected investment earnings therefrom in the amount of $15000 proceeds ofthe Boroughs General Obligation School Bond 2011 Series in the principal amount of $8000000 General Obligation School Bond Series 2013 in the principal amount of $21595000 General Obligation School Bond 2014 in the principal amount of $22660000 General Obligation School Bond 2015 Series in the principal amount of $6210000 and investment earnings therefrom grant funding in the amount of $7538000 and other money of the Borough legally availableto beused therefor The net amount received by the Borough as resultof thesale ofthe 2016A Bond after payment of all expenses of issuing selling and delivering the 2016A Bond and the Bond Bank Bonds is not expected to exceed the amount necessary to pay the costsofthe 2016A Improvements 3.4 Cost of the 2016B Improvements The costofthe 2016B Improvements is estimated to be $10230500 whichcost will be paid from the proceeds of the issuance and saleofthe 2016B Bond reasonablyexpected investment earnings therefrom in the amount of $5000 proceeds of the Boroughs General Obligation School Bond 2015 Series in the amount of $1780000 and investment earnings therefrom and other money of the Borough legally availableto be used therefor The net amount received by the Borough as resultofthesale ofthe 2016B Bond after payment of all expenses of issuing selling and delivering the 2016B Bondand the Bond Bank Bonds is not expected to exceed the amount necessary to pay the costs of the 2016B Improvements Construction Schedule for the Improvements 4.1 Commencement and Prosecution of Construction ofthe Improvements Construction ofthe Improvements has already commenced and the Borough has entered intocontract or otherwise incurredsubstantial bindingobligation toward commencement of the Improvements involving an amount equal to at least 5%of the sale proceeds of the 2016 Bonds or will have entered into such contractor other substantial binding obligation within six months after the Issue Date Work on the Improvements and expenditure ofthesale proceeds ofthe 2016 Bonds are expected to proceed with due diligence to completion 4.2 Completion ofthe Improvements It is expected that at least 85%of the sale proceeds of the 2016Bonds will be spent for the Improvements byFebruary 514963343 2019 the date that is three years afterthe Issue Date The expected schedule for expenditure of 2016Bonds proceeds is attachedheretoas Exhibit 4.3 No Sale of ImprovementsExpected The Improvements are not expected to be soldor otherwise disposed of in whole or in part prior to maturity of the 2016 Bonds otherthan to dispose of any portion of the Improvements that becomes inadequate obsolete worn out unfit or no longer necessary or useful to the operation ofthe Improvements Payment of 2016 Bonds 5.1 Debt Service Structure 2016A Bond The 2016A Bond is general obligation bond ofthe Borough The 2016ABond matures on August 2035 Principal of the 2016A Bond is payableannually in installments on August of each year from 2016 through 2035 inclusive Interest on the 2016A Bond is payablesemiannually on each February and Augustcommencing on August 2016 The principal installments on the 2016A Bond due on or before August 2025 are not subject to prepayment The principal installments on the 2016ABonddue on or after August 2026 are subject to prepayment in whole or in part at the option ofthe Borough on any date on or after February 2026 at price of 100%of the amount thereof to be prepaid plus accrued interest to thedate of prepayment 5.2 DebtService Structure 2016B Bond The2016B Bond is general obligation bond of the Borough The2016B Bond matures on August 2025 Principal of the 2016B Bond is payableannually in installments on August of each year from 2016 to 2025 inclusive Interest on the 2016B Bond is payable semiannually on each February and August commencing on August 2016 The principal installments on the 2016B Bond are not subject to prepayment 5.3 Source of Payment The2016Bonds are payable from the proceeds of taxes levied against all ofthe taxable property locatedwithin the Borough and other funds available therefor Those funds that are expected to be used to pay principal of or interest on the 2016Bonds will be deposited in the Bond Fund and used within 13 months of their deposit in the Bond Fund for payment of principal of or interest on the 2016 Bonds TheBondFund will be used primarily to achieve propermatching oftax revenues of the Borough and debt service on the 2016Bonds within eachbond year It is expected that the BondFund will be depleted at least once year on each August except for reasonable carryover amount not expected to exceed the greater of one years earnings on the Bond Fund or 1/12 of theannualdebt service on the 2016 Bonds 5.4 Absence of Other Sinkinc Funds Except for the Bond Fund the Borough has not created or established and does not expect to create or establish any reserve fund sinking fund or other similar fund that is reasonablyexpected to be used directly or indirectly to pay debt service on the 2016Bonds or any pledged fund with respect to which there is reasonable assurance that money will be available in that fund to pay 51496334.3 debt service on the 2016 Bonds even if the Borough were to encounter financial difficulties Restrictions on Investing Proceeds ofthe 2016 Bonds in Higher Yielding Investments 6.1 CalculationofYield on 2016 Bonds For purposes of this certificate the yield on the 2016Bonds is deemed to be equal to the yield on the BondBank Bonds The yield on the BondBank Bonds has been calculated as the yield that when used in computing the present worth of all payments of principal of and interest on the Bond Bank Bonds produces an amount equal tothe issue price of the Bond Bank Bonds The issue price of the Bond Bank Bonds is the initial offeringprice of the Bond Bank Bonds including original issuediscount or premium if any at which substantial amount at least 10%of each maturity of the BondBank Bonds has been soldtothe public not including bond houses brokers or other intermediaries The yield on the BondBank Bonds has been calculated to be 2.4794%Such determination as to yield has been made based on representations made by Morgan Stanley Co LLC underwriter ofthe BondBank Bonds attached hereto as Exhibit In determining this yield no adjustments were made for underwriters discount or othercosts of issuance ofthe BondBank Bonds However pursuant to the specialyield calculationrule providedby Treasury Regulations Section 1.148-4b3iiB for the purposes of determining the yield on the BondBank Bonds the BondBank Bonds due in 2027 through 2028 inclusive were treated as redeemed on February 2026 because such redemptions would produce the lowest yield on the Bond Bank Bonds 6.2 BondBank Debt Service ReserveFund Surety Bond Premium Taken Into Account as Payment for Qualified Guarantee With Respect to the 2016 Bonds For the purpose of calculating the yield on the BondBank Bonds debt service reserve fund surety bond premium allocableto the Bonds and paid to NationalPublic Finance Guarantee Corporation National in the amount of $1906.73 has been taken into accountas additionalinterest paid with respect to the Bond Bank Bonds and as payment for qualified guarantee under TreasuryRegulations Section 1.148-4f Based on thecertificateof the financial advisor to the Bond Bank Western Financial Group LLC attachedhereto as Exhibit amounts required to be retained in the Bond Bank Reserve Fund which functions as debt service reserve fund for the BondBank Bonds and other obligations ofthe BondBank issued on parity with the BondBank Bonds are reasonably required in that any significant reduction in thesizeof such amounts would havehad material adverse impact on the underwriters ability to sell the BondBank Bonds at the yield on the BondBank Bonds The surety bond premium paid to Natiopal represents reasonable charge for the transfer of the credit risk associated with the Bond Bank Bonds to National No portion ofthe surety bond premium paid to National represents payment directly or indirectly for any services other than the acceptance ofthecredit risk associated with the BondBank Bonds and any fees for any suchotherservices have been separately stated 514963343 6.3Restrictions on Investment of Proceeds in Higher Yielding Investments Construction Fund The proceeds ofthe BondBank Bonds loaned to the Borough pursuant to the Loan Agreement and the 2016Bonds and used to carry out the Improvements will be deposited in the Construction Fund and may be invested in higher yielding investments for temporary period not exceeding three years after the Issue Date Proceeds Used for Costs of IssuanceProceeds of the 2016Bonds to be used to pay costs of issuance ofthe BondBank Bonds are expected to be spent for that purpose on the Issue Date and not invested Bond Fund Proceeds ofthe 2016Bonds representing the contingency amounts deposited in the Bond Fund and other amounts treated as replacementproceeds ofthe 2016Bondsbecause they are held in the BondFund may be invested in higher yielding investments for temporary period not exceeding 13 months afterthe date of their deposit in the Bond Fund Investment Earnings Investment proceeds ofthe 2016Bonds for which no other temporary period is available may be invested in higher yielding investments for temporary period of one year afterthe date of receipt of those investment earnings RestrictedYield Investments Proceeds and amounts treated as replacement proceeds ofthe 2016Bonds that may not be invested in higher yielding investments will be invested only in obligations purchased at fair marketvalue in bona fide arms-length transactions in an establishedmarket for those obligations and having yields not materially higher than the yield on the 2016Bonds when calculated using the same frequency intervalof compounding interest as used for the 2016Bonds ii obligations the interest on which is excludedfrom gross income underSection 103 of the Code that are not private activity bonds underSection 141 ofthe Code or obligations treated as tax-exempt obligations under Section 103 of the Code e.g obligations issued by certain qualified regulated investment companies that invest to the extent practicable all of their assets in tax-exempt governmental bonds and meet certain other conditions iii Demand Deposit Securities issued by the United States Treasurypursuant to theState and Local Government Series program or iv other UnitedStates Treasury ObligationsState and Local Government Series having yields not materially higher than the yield on the 2016 Bonds Compliance With Arbitrage Rebate Requirement The Bond BankBonds are subject to the rebate requirement imposed by Section 148f ofthe Code Because proceeds of the BondBank Bonds used pursuant to the Loan Agreement to acquire the 2016Bonds from the Borough are not treated as spent until those proceeds are used to carry outthe Improvements those proceeds continue to be treated as proceeds of the BondBank Bonds until spent for that purpose and the Borough on behalf ofthe Bond Bank in the manner and to the extent required 5149334.3 by that Section will calculate and rebate to the UnitedStates any investment earnings on gross proceeds of the BondBank Bonds and the 2016 Bonds plus any income attributableto such excess earnings Investment earnings on amounts held in the Bond Fund will not be taken into account for this purpose at any time even if the amount earned is $100000 or more in bond year because the 2016Bonds bear interest at fixedrates i.e ratesthat do not vary during theterm ofthe 2016 Bonds and havean average maturity of at least years If the Borough for any reason fails to comply with the rebate requirement totheextent applicable tothe BondBank Bonds and the 2016 Bonds the Borough to the extent permitted and required by Section 14807 of the Code will payany penalty that may be necessary to preserve the tax exemption for interest on the 2016 Bonds 2016BondsMeet Other Arbitrage Requirements 8.1 No Other Governmental Obligations Partof This Issue There are no other obligations ofthe Borough that are being sold at substantially the same time less than 15 days apart as the 2016 Bonds pursuant to the same plan of financing and that are reasonablyexpected to be paid from substantially the same source of funds 8.2 No Replacement of Funds Invested in Higher Yielding Investments No portion of the proceeds ofthe 2016Bonds will be used directly or indirectly to replace funds of the Borough invested in higher yielding investments 8.3 No Abusive Arbitrage DeviceThe primary bona fide governmental purpose of issuing the 2016Bonds is to financethecosts ofthe Improvements No action is being taken or will be taken in connection with theissuance of the 2016 Bonds that hasthe effectof enabling the Borough to exploit the difference between tax-exempt and taxable interestrates to obtainmaterialfinancial advantage by investing any portion ofthe gross proceeds ofthe 2016 Bonds over any period of time and ii overburdening the tax-exempt bond market as resultof issuing the 2016 Bonds in higher amount issuing the 2016Bonds earlier or allowing the 2016Bonds to remain outstandinglonger than is otherwise reasonablynecessary to finance the Improvements 8.4 No Intent To Earn ImpermissibleArbitrage Profit The Borough will not take any intentional action to earn any impermissible arbitrage profit from the investment of gross proceeds ofthe 2016 Bonds 2016 BondsMeet Other Requirements for Tax Exemption 9.1 2016Bonds In Registered Form The 2016Bonds areissued only in registered form 9.2 No Federal Guaranty Except as otherwise permitted by the Code payment of the principal of or interest on the 2016Bonds is not guaranteed in whole or in part by theUnited States or any agency or instrumentality thereof 5496334.3 9.3 Information Return ToBe Filed The Borough will causeForm 8038-G Information Return respecting the 2016Bonds to be timely filed with the Internal Revenue Service 9.4 2016Bonds Not Hedge Bonds The Borough reasonablyexpects that at least 85%of the spendableproceeds ofthe 2016 Bonds will be used to carry out the governmentalpurposes ofthe 2016Bonds within the three-year period beginning on theIssue Date and ii not more than 50%ofthe proceeds of the 2016Bonds will be invested in nonpurpose investments having substantially guaranteed yield for years or more 9.5 Post-Issuance Compliance Procedures The Borough has previously established written procedures attachedheretoas Exhibit to monitor the requirements of Sections 141 and 148 ofthe Code afterthe Issue Date and ii ensure that any portion ofthe Bond that becomes nonqualified is remediated in accordance with the requirements under TreasuryRegulations Section 1.141-12 10 2016Bonds Tax Exempt and Not Arbitrage Bonds The Borough expects that bond counsel to the Borough will rely upon the foregoing facts estimates and circumstances in existence on the Issue Date and the reasonable expectations of the Borough as tofuture events respecting the 2016Bonds to enable them to conclude that it is not expected that proceeds ofthe 2016Bonds will be used in any manner that would cause the 2016Bonds to be arbitrage bonds and to provide their opinion that the 2016Bonds are governmental obligations theinterest on which is excluded from gross income for federal income tax purposes under Section 103 ofthe Code DATED February 2016 KODIAKISLAND BOROUGH ALASKA By______________ Karleton Short Finance Director Exhibit Draw Down Schedule ExhibitCertificate of Western Financial Group LLC Exhibit Certificateof Morgan Stanley Co LLC Exhibit Post-Issuance Compliance Procedures for Tax-Exempt Bonds 51496334.3 KIB Renewaland Replacement Projects Anticipated CashFlow $144808 iLl ii 347 $106347 $2766515 $1891890 $1489134 $3000000 $2500000 $2000000 $1500000 $1000000 $500000 $- $1018349 $1369401 $747874 $211753$211753II $21024.00 2/24/2016 $6000000.00 $5500000.00 $5000000.00 $4500000.00 $4000000.00 $3500000.00 $3000000.00 $2500000.00 $2000000.00 $1500000.00 $1000000.00 $soo000.oo KHS Monthly Construction Cost rrr $4 .S $4cY9 2/24/2016 EXHIBIT Certificate of Western Financial Group LLC $33015000 Alaska Municipal BondBank General Obligation and Refunding Bonds 2016 Series One Western Financial Group LLC hasserved as financial advisor to the Alaska Municipal BondBank the Issuer in connection with theissuance by the BondBank of its General Obligation and Refunding Bonds 2016 Series One the Bonds Pursuant to General Obligation Bond Resolution adopted by the Board of Directors of the Issuer on July 13 2005 the Master Resolution and Resolution No 20 15-05 adopted on December 15 2015 the Series Resolution with respect to the Bonds each governmental entity borrowing funds through the BondBank Borrower with the exception of entities borrowing on general obligation basis is required to maintain debt servicereserve fund to secure payment of debtservice under the loans made by the Issuer to the Borrowers pursuant to Loan Agreementby and between the BondBank and the Borrower each Borrower Reserve Fund Capitalized terms used butnotdefinedherein shall have the meanings ascribed to them in the Tax Certificate relating to the Bonds datedthedate hereof to which this certificate is attached as an exhibit On behalf of the Financial Advisor the undersignedhereby certifies and represents as follows The amounts required to be retained in the Issuer Reserve Fund which functions as debtservice reserve fund for the Bonds and other obligations of the Issuerissued on parity with the Bonds are reasonably required in that any significant reduction in the size of such amounts would havehad material adverse impact on the underwriters ability to sell the Bonds at the pricescorresponding to the yields indicated in the Official Statement for the Bonds dated January 20 2016 The fundingrequirement for the Borrower Reserve Funds which secure payment of debt service on the Loans butnot the Bonds is an amount reasonablyrequired to induce the issuer to make the Loans to those Borrowers who are not general obligation Borrowers The present value of the amounts paid to obtain the Surety Bond as defined in the Tax Certificate is less than the present value of the interest expected to be saved as result of the Surety Bond using the yield on the Bonds as discount factor for this purpose To thebest knowledge of the undersigned the amount paid by the Issuer to the Insurer for the Surety Bond is within reasonable range of premiums charged for comparable credit B-i OHSUSA764424685.4 enhancement for obligations comparable to the obligation evidenced and represented by the Bonds The fees paid and to be paid to obtain the Surety Bond were determined in arms-length negotiations and were required as condition to theissuance by the Insurer of the Surety Bond To thebest of knowledge of the undersigned the fees paid and to be paid for the Insurer represent commercially reasonable charge for the transfer of credit risk Such fees do not include any direct or indirect payment for cost risk or otherelement that is not customarily borne by guarantors of tax-exempt bonds in transactions in which the guarantor has no involvement otherthan as guarantor No non-guarantee services are beingprovided by the Insurer The undersigned understands and acknowledges that the Issuer may rely on this certificate in making certain of the representations contained in certificate the Issuer executes in connection with theissuance of the Bonds and further understands that Orrick Herrington Sutcliffe LLP as Bond Counsel may rely upon this certificate among other things in rendering certain opinions relating the Bonds The undersigned makes no representations as to the legal sufficiency of the information set forthin this certificate for purposes of complying with the Code or for any other purpose Dated February 2016 WEST INA GROUP LLC By B-2 OHSUSA764424685.4 Certificateof the Morgan Stanley Co LLC $33015000 Alaska Municipal BondBank General Obligation and Refunding Bonds 2016 Series One Morgan Stanley CO LLC the Underwriter purchaser of the $33015000 aggregate principal amount of Alaska Municipal BondBank General Obligntion and Refunding Bonds 2016 Series One the Bonds of the Alaska Municipal Bond Bank certify the following facts for purpose of determining the issue price of the Bonds Authorized Representative The undersigned is the duly authorized representative of Morgan Stanley Co LLC On January 20 2016 the Sale Date the Underwriters madebona fide public offering of the Bonds tothe public excluding bond houses brokers and similar persons acting in the capacity of underwriters or wholesalers Public Buyers at the following reQifering prices expressed as percentage of the principal amount the Initial Reofferiug Prices Maturity Year August Principal Amount Reoffering Price 2016 695000 102.308 2017 725000 106.315 2018 765000 109.893 2019 1780000 113.528 2020 1870000 116.588 2021 1955000 119158 2022 2045000 121.590 2023 2065000 123.057 2024 2165000 124.663 2025 2285000 125.242 2026 1695000 99.000 2027 1725000 115.588 2028 1785000 114.624 2029 l860000 98.000 2030 19050100 101.296 2031 1780000 100.000 2032 1825000 98.7 16 2033 1860000 97.500 2034 470000 98.000 2035 485000 98.500 2036 365000 9000 2040 910000 99.000 C\Userss3s\1octrnentsAlnska BB issue Price Cert ocx On theSale Date based upon our assessment of market conditions investor demand sale and offering prices for comparable bonds and the recent behavior of interest rates the Underwriter reasonably cxpected that the Initial Reoffering Prices could be market clearing price for the Bonds of cacti maturity On the Sale Date the Initial Reoffering Prices did not exceed the fair market value of the Bonds Based upon the Underwriters records the Initial Reoffering Prices were the first prices at which substantial portion at least 10%of the Bonds of each maturity were sold to Public Buyers except thatthe Underwriter did not sell substantial portion of the Bonds maturing on August of the following years 2024 2026 through 2030 and 2032 through 2036 at the Initial Reoffering Priceto Public Buyers These representations are provided to Otrick Herrington Suteliffe LLP and the Bond Bank to provide them withinformation concerning the Bonds ii Foster Pepper PLLC and Levesque Law Group LLC to provide them with information concerning the municipal bonds of the Kenai Peninsula Borough Alaskaand the Kodiak Island BoroughAlaska OiiKLGatesLLPtoprovideitwithinformationconcerningthemunicipalbondsoftheCityof Kiawock Alaska and Jermaine Dunnagan Owens P.C to provide it withinformation concerning the municipal bonds of the City of SewardAlaska in each case for purposes of fonnulating their opinions in respect of such municipal bonds and are not to be used or relied upon byany other person The Underwriter expresses no yiew regarding the legal sufficiency or thecorrectness of any legalinterpretation made by bond ounscl and nothing herein represents the Underwriters interpretation of any laws or regulatioiis under theInternal Revenue Code of 1986 andthe Underwriter expresses no view regarding the legal sufficiency of any representations made herein PAGE FOLLOWS c\uscrs\s3s\Documcntsvdnska 1313 IssuePrice ceadoex Dated February 2016 MORGAN STANLEY CO LLC By Authorized Officer C\Vsr\s3sDocuinenLs\AInsk-a RB IssuePrice Certdex POST-ISSUANCE COMPLIANCE PROCEDURES FOR TAX-EXEMPT BONDS Kodiak Island Borough Alaska the Borough issues governmental tax-exempt bonds subject to ongoingcompliance obligations that must be met to preserve the tax-exempt status of the bonds Inaddition to loss of tax-exemption adverse consequences can result from failure to comply with Internal Revenue Service IRS restrictions relating to arbitrage timing and use of bond proceeds and other aspects of bond issue However issuersthat discover noncompliance as result of the adoption and adherence to written post-issuance compliance policy are eligible for significantly more favorabletreatment when remediating the noncompliance through the IRSs Voluntary Closing Agreement Program Accordingly the Borough has adopted these procedures to assist in identifying and correcting noncompliance in timely manner Responsibility for Maintaining Compliance The Assembly of Borough hasthe overall final responsibility for monitoring whether the Borough is in compliance with post-issuance federal tax requirements for its tax-exempt bonds However the Assembly has delegated to the Finance Director the primary operating responsibility for implementing and monitoring compliance with this policy document The Finance Director shouldconsult with bond counsel when there are questions or concerns about the application of applicable federal law to tax-exempt bond financing or post-issuance tax compliance issue Expenditures of Tax-Exempt Bond Proceeds For each project financed in whole or part with tax-exempt bond proceeds the Finance Director will monitor the expenditure of both tax-exempt bond proceeds and funds that are not proceeds of tax-exempt bonds and will trackallocations of tax-exempt bond proceeds and funds that are not proceeds of tax-exempt bonds to project expenditures For expenditures of tax-exempt bond proceeds the Finance Director will record the date purpose property financed and vendor associated with each expenditure of bond proceeds and identify which expenditures are for the purpose of reimbursing the Borough for prior expenditures Use of Property Financed with Tax-Exempt Bond Proceeds For each issue of tax-exempt bonds the Finance Director will monitor the use of property financed with tax-exempt bond proceeds for the term of the bond issue and for the term of any bonds issued to refundthe original issue or issued to refund an issue that refunded the original issue The Finance Director will monitor suchuse no less frequently than once year Arbitrage Yield Restriction and Rebate For each issue of tax-exempt bonds the Finance Director will monitor the interest earned on investment of tax-exempt bond proceeds onan annualbasis and will cause arbitrage rebate calculations to be made as required by applicable federal law If necessary the FinanceDirector also will cause the appropriate federal arbitrage taxreturns to be prepared and timely filed with the IRS together with any rebate amount owed 1496575.1 Identification ofPotentialViolations If at any time during the term of an issue of tax-exempt bonds the Borough discovers that violation of federaltax requirementsapplicable to that issue may have occurred theFinance Director will consult with bond counsel to determine whether any such violation actually has occurred and if so take prompt action to accomplish an available remedial action under applicable IRS regulations orenter into closing agreement with the IRSunder the Voluntary Closing Agreement Program described underNotice 2008-31 or otherfuture published guidance Record Retention Records relating to tax-exempt bonds must be maintained as required by theState Auditors Office However notwithstanding the recordretention requirements set forth by the State Auditors Office records relating to tax-exempt bonds must be maintained for the term of the bond issue plus three years or in the case of an issue refunded by one or more subsequent bond issues for the combined term of theissues plus three years Training It is the policy of Borough that the Finance Director and his or her staff as well as the principal operating officials of those departments of the Borough for which property is financed with tax-exempt bonds should be provided with education and training on federaltax requirements applicable to tax-exempt bonds The Borough therefore will enable and encourage those personnel to attend and participate in educational and training programs offered by among others bondcounsel the Washington Municipal Treasurers Association and the Washington Finance OfficersAssociation with regard to the federaltax requirements applicable to tax-exempt bonds 51496575.1 Form 8038G InformationReturn for Tax-Exempt Governmental Obligations Rev September 2011 Under Internal Revenue Code section 149e 0MBNo 1545-0720 See separate instructions Department of the Treasury Internal Revenue Semice Caution If the issue pnce is under $100000 use Form8038-GC III Reporting Authority If Amended Return check here LI Issuers name issuers employer identification number EIN Kodiak Island Borough Alaska 92-0030845 3a Name of person other than issuer with whom the IRS may communicateabout thisreturn see instructions 3b Telephone number of other person shownon3a Number and street or P.O box if mail is notdeliveredtostreet address Room/suite Report number For IRSUse Only 710 Mill Bay Road City town or post office state andZIPcode Date of issue Kodiak Alaska 99615 February 2016 Name ofissue CUSIPnumber General Obligation School Bond 2016 Series and 2016 Series NIA lOa Name and title ofofficerorother employee oftheissuer whom the IRS may call for more information see lOb Telephone number ofothceror other instructions employee shown on Oa Karleton Short Finance Director 907-486-9320 ITIII Type ofIssue enter the issue price See the instructions and attach schedule __________ 11 Education 11 8078297 12Healthand hospital 12 __________ 13 Transportation 13 _________ 14 Public safety _14 __________ 15 Environment including sewage bonds 15 __________ 16 Housing _________ 17 Utilities __________ 18 Other Describe ____________________________________________________________________18 19 If obligations are TANs or RANs check only box 19a LI If obligations are BANs check only box 19b LI 20 If obligations are in theform of lease orinstallment sale check box LI ITI II Description of Obligations Complete for the entire issue for which this form is being Stated redemption Weighted Final maturity date Issue price price at maturity average maturity 21 08/0112035 80782971 $_70100001 1.1555 years IIL4 Uses of Proceeds of Bond Issue includinq underwriters discount Yield 2.4794 22 Proceedsused for accrued interest 22 23 Issue price ofentireissue enter amount from line 21 column L2..8078297 24Proceeds used for bondissuance costs including underwriters discount 24 71193 25 Proceedsused forcredit enhancement 25 1907 26 Proceeds allocatedto reasonably required reserve or replacement fund 26 27 Proceedsused to currently refund prior issues 27 28 Proceedsused to advance refund prior issues 28 29 Total add lines 24 through 28 29 73099 30 Nonrefundingproceeds of the issue subtract line 29 from line 23 andenter amount here 308005197 1J1ThTI Description of Refunded Bonds Complete this partonly for refunding bonds 31 Enterthe remainingweighted average maturity of the bonds to be currently refunded years 32 Enterthe remainingweighted average maturity of the bonds to beadvance refunded years 33 Enter the last date on which the refundedbonds will be called MM/DDIYYYY 34 Enter the dates the refunded bonds were issued MM/DD/YYYY For Paperwork ReductionAct Notice see separate instructions Cat No 63773S Form 8038G Rev 9-2011 Form8038-G Rev 9-2011 Page 1flTh1IMiscellaneous 35 Enter the amount ofthe state volume cap allocated tothe issue under section 141 b5 36a Enter the amount of grossproceeds invested orto be invested in guaranteed investment contract GIG see instructions 36a Enterthe final maturity date of the GIC ___________________________________ Enterthe name ofthe GIG provider ___________________________________ 37 Pooled financings Enter the amount of the proceeds of thisissuethat are to be used to make loans to other governmental units 37 38a If thisissue is loan made from the proceeds of another tax-exempt issue check box and enterthe following information Enter the date of the master pool obligation 02/0212016 Enterthe EIN of the issuer of the master pool obligation 92-6001185 Enterthe name of the issuerof themaster pooi obligation Alaska Municipal Bond Bank 39 If the issuer has designated the issue under section 265b3BOlII small issuer exception check box LII 40 If the issuer has elected to paypenalty inlieu of arbitrage rebate check box LI 41a If the issuer has identified hedge check here LI and enter the following information Name of hedge provider _________________________________ Typeofhedge ____________________________________ Term of hedge __________________________________________ 42 If the issuer has superintegrated the hedge check box LI 43 If the issuer has established written procedures to ensure that all nonqualified bonds ofthisissue are remediated according to the requirements under the Code and Regulations see instructions check box 44 If the issuer has established written procedures to monitor the requirements of section 148 check box 45a If some portion ofthe proceeds was used to reimburse expenditures checkhere LI and enter the amount of reimbursement _______________________________________________ Enter the date the official intent was adopted _____________________________________________ Under penalties of perjury declare that have examined thisreturn and accompanying schedulesandstatements and tothebestof my knowledge Signature and belief they are truecorrect and complete furtherdeclarethat consent tothe IRSs disclosureofthe issuers return information as necessary to and process thisreturntothe person that have authorizedabove Consent 2/2_I Karleton Short Finance Director Signature of issuers authorized representative Date Type or print name and title lDatePrint/Type preparers name Preparers signstur Check if IPTINPaid Preparer Marc Greenough I4.4C4_4_t1 2I-seIf-employed P01061698 Use Only Firms name Foster Pepper PLLC Firms EIN 910606972 Firms_address_.__1111_Third_Aye_Suite_3400_Seattle_WA_98101 Phone_no 206-447-4400 Form 8038-G Rev 9-2011 CERTIFICATE OF MAILING Susan Carpenter legal assistant at Foster Pepper PLLC in Seattle Washington certify that on this day mailed the original IRS Form 8038-G relating to Kodiak Island Borough Alaska General Obligation School Bond 2016 Series $1870000 and General Obligation School Bond 2016 Series $5140000 Issue Date February 2016 Dated Date February 2016 to the Department of the Treasury Internal Revenue Service Center Ogden Utah 84201 by certified mail return receiptrequested 7012 2210 0002 1583 1690 DATED February 26 2016 Susan Carpenteit 505268.1 207890-000004 NO LITIGATION CERTIFICATE KODIAK ISLAND BOROUGH ALASKA $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES Joseph Levesque certify that am the duly appointed and acting Borough Attorney of Kodiak Island Borough Alaska the Borough and that am authorized to executeand deliver thiscertificate and further certify on behalfof the Boroughas follows This certificate is delivered in connection withthe issuance by the Borough of its $5140000 General Obligation School Bond 2016 Series the 2016B Bond No litigation of any nature is now pending or to my knowledge threatened affecting the corporate existence or boundaries ofthe Borough or the title of the present officers to their respective offices and no authority or proceeding for the issuance of the 2016BBond hasbeen repealed revoked or rescinded No litigation of any nature is now pending or to my knowledge threatened seeking to restrainor enjoin the issuance saleor delivery ofthe 20168 Bond or the right ofthe Borough to levy and collect taxes pledged or to be pledged to pay the principal of and interest on the 2016B Bond or the pledge thereof or in any way contesting or affecting the validity orenforceability of the 2016BBond or the loan agreement between the Borough and the Alaska Municipal BondBank relating to the 2016B Bond or contesting the power ofthe Borough or its authority with respect to the 2016B Bond No litigation of any nature is now pending or to my knowledge threatened against the Borough involving any of the property or assets of or under the control of the Boroughwhich individually or in the aggregate involvesthe possibility of any judgment or uninsured liability which may result in any material change in the revenues properties or assets or in the condition financial or otherwise ofthe Borough Dated February 2016 J1Jo4hLevesqueBoroughAttorney 51496271 SIGNATURE CERTIFICATE KODIAK ISLAND BOROUGH ALASKA $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES STATEOFWASHINGTON ss COUNTY OF KING NOVA JAVIER MMC hereby certify as follows am the duly appointed qualified and acting Borough Clerk of Kodiak Island Borough Alaska the Borough and as such am authorized to execute thiscertificate The Kodiak Island Borough Alaska $5140000 General Obligation School Bond 2016 Series the 2016B Bond was dulysigned on behalf of the Borough by Jerrol Friend Mayor of the Borough and duly attested by Nova Javier Clerk of the Borough The signatures of the Mayor and the Borough Clerk on the 2016B Bond are the true and genuine signatures of such respective officers Such officers are the duly elected or appointed qualified and acting officers of the Borough holding such respective offices and authorized to execute the 2016B Bond The seal that is impressed upon thisCertificate is the duly adopted and only official seal of the Borough and hasbeen impressed on the 2016B Bond i1krT\ Nova Javier MMC Borc1h Clerk TO before me this day of February 2016 SignatureNotary Marc Greenough Legibly Print or Stamp Name of Notary Notary public ig and for theState of Washington residing at Cj Q.AttttC_ My appointment expires y1917 51496271 NO R-I $5140000 UNITEDSTATES OF AMERICA KODIAKISLAND BOROUGH ALASKA GENERAL OBLIGATION SCHOOL BOND 2016 SERIES REGISTERED OWNER ALASKA MUNICIPAL BONDBANK PRINCIPAL AMOUNT FIVE MILLION ONE HUNDRED FORTYTHOUSANDAND NO/I 00 DOLLARS The Kodiak Island Borough the Borough municipal corporation of the State of Alaska hereby acknowledges itself to owe and for valuereceived promises to pay to the Registered Owner identified above or its registered assigns the principal amount identified above in the following installments on each of the following years and to pay interest on such installments from the date hereof payable on August 2016 and semiannually thereafter on February and August of each year attherates per annum as follows Year Principal Interest Year Principal Interest August Installment Rate August Installment Rate 2016 $235000 5.00%2021 $540000 5.00% 2017 440000 5.00 2022 570000 5.00 2018 465000 5.00 2023 595000 5.00 2019 490000 5.00 2024 630000 5.00 2020 515000 5.00 2025 660000 5.00 When and if this Bond is owned by the Alaska Municipal BondBank or Financial Institution payment of principal and interest shall be made as provided in the Loan Agreement between the BondBank or Financial Institution and the Borough the Loan Agreement When and if this Bond is not owned by the BondBank or Financial Institution installments of principal of and interest on this Bond shall be paid by check or draft mailed by first classmail to the Registered Owner as of the close of business on the 15th day ofthe month before each installment payment date provided that the final installment of principal of and interest on this Bond shall be payable upon presentation and surrender of this Bond by the Registered Owner at the office of the Registrar Interest will be computed on thebasisof 360-day year consisting of twelve 30-day months Both principal of and interest on this Bond are payable in lawful money of theUnited States of America which on the respective dates of payment thereof shall be legal tender for the payment of public and private debts 51496332 This Bond is one of theGeneral Obligation School Bonds of the Kodiak Island Borough Alaska of like tenor and effect except as to interest rate serial number right of redemption or prepayment and maturity and constituting Bonds authorized for the purpose of paying the costof school and related capital improvements in the Borough and is issued underResolution No FY2016-06 of the Borough entitled RESOLUTION OF THE KODIAKISLAND BOROUGH ASSEMBLY AUTHORIZING THE BOROUGH TO ISSUE GENERAL OBLIGATION SCHOOL BONDS IN THE PRINCIPAL AMOUNT NOT TOEXCEED $10230000 TO FINANCE THE RENEWALANDREPLACEMENT SCHEDULERELATED TO BOROUGH-OWNED SCHOOL FACILITIES PROJECTSWHICHARE 70%REIMBURSABLEBY THE STATE OF ALASKA ANDTOPAYCOSTSOF ISSUING THE BONDS FIXING CERTAINDETAILS OFSUCH BONDS AUTHORIZINGTHEIR SALE AND PROVIDING FOR RELATEDMATTERS the Resolution Installmentsof principal of this Bond are not subject to prepayment This Bond is transferable as provided in the Resolution only upon the Bond Register of the Borough and ii upon surrender of this Bond together withwritten instrument oftransfer duly executed by the Registered Owner or the duly authorized attorney of the Registered Owner and thereupon new fully registered Bond or Bonds in the same aggregate principal amount and maturity shall be issued tothe transferee in exchange therefor as provided in the Resolution and upon the payment of charges if any as therein prescribed The Borough may treat and consider the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of or on account of the principal or redemption price if any hereof and interest due hereon and for all other purposes whatsoever This Bond is general obligation ofthe Kodiak Island Borough and the full faith and credit of the Borough are pledged for the payment of the principal of and interest on this Bond as the same shall become due ITIS HEREBY CERTIFIED AND RECITED that all conditions acts or things requiredby the constitution or statutesof the Stateof Alaska to exist to have happened or to have been performedprecedent to or in the issuance of this Bond exist have happened and have been performed and thatthe seriesof Bonds of which this is one together with all other indebtedness of the Borough is within every debt and other limit prescribedby such constitutionor statutes S4%332 IN WITNESS WHEREOF THE KODIAK ISLAND BOROUGH ALASKA has caused this Bond to be signed inits name and on its behalf by the manual or facsimile signature of its Mayor and its corporate seal or facsimile thereof to be impressed or otherwise reproduced hereon and attested by the manual or facsimile signature of its Clerk all as ofthe 2nd day of February 2016 EAL ATT Borough Clerk KODIAKISLAND BOROUGH BordugMayor 514963321 CERTIFICATEOFFINANCE DIRECTOR KODIAKISLAND BOROUGH ALASKA $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES Karleton Short hereby certify as follows am the duly appointed qualified and acting Finance Directorof Kodiak Island Borough Alaska the Borough and as such am authorized to execute this certificate Pursuant to Resolution No FY2016-06 ofthe Borough have approved the dated datedenomination principal and interest payment dates principal amount principal amount of each installment interest rates optional prepayment terms and other detailsof the Boroughs General Obligation School Bond 2016 Series the 2016B Bond as setforth in the 2016B Bondand the Loan Agreement relating to the 2016B Bond between the Borough and Alaska Municipal Bond Bank dated as of January 20 2016 The determination ofthe foregoing matters isin accordance with Resolution No FY2016-06 ofthe Borough Dated February 2016 Karleton Short Finance Director I49ô27I PAYMENT DELIVERY AND APPLICATION OF PROCEEDS CERTIFICATE KODIAKISLAND BOROUGH ALASKA $5140000 GENERAL OBLIGATION SCHOOL BOND 2016 SERIES Karleton Short hereby certify as follows am the duly appointed qualified and acting Finance Directorof Kodiak Island Borough Alaska the Borough and assuch am authorized to execute this certificate On the date hereof delivered to the Alaska Municipal Bond Bank Juneau Alaska the Bond Bank the $5140000 General Obligation School Bond 2016 Series ofthe Borough the 2016B Bond At or before the time of delivery ofthe 2016B Bond the Borough received from the BondBank the following amounts as full payment for the 2016B Bond Principal of 2016B Bond $5140000.00 Original issue premium 916607.10 Total Sources of Funds $6056607.10 The Borough will apply the amount received from the BondBank as payment for the 2016B Bond in the following manner Project Fund $6000000.00 DebtService Account 3007.83 Costs of Issuance 27061.43 Underwriters Discount 26537.84 Total Uses of Funds $6056607.10 Dated February 2016 Karleton Short Finance Director Deven Mitchell Executive Directorofthe Alaska Municipal Bond Bank Juneau Alaska hereby acknowledge receipt from Kodiak Island Borough Alaska the Borough ofthe following bond of the Borough $5140 000 General Obligation School Bond 2016 Series Dated February 2016 Dev Mitchell Executive Director Ala ka Municipal BondBank FOSTER PEPPERILLC February 2016 Kodiak Island Borough Alaska Alaska Municipal BondBank Re Kodiak Island Borough Alaska $5140000 General Obligation School Bond 2016 Series We have served as co-bondcounsel to Kodiak Island Borough Alaska the Borough in connection with theissuance of the above-referenced bond the 2016B Bond and in that capacity have examined such law andsuch certified proceedings and other documents as we have deemed necessary to render this opinion As to matters of fact material to this opinion we have relied upon representations contained in the certified proceedings and other certifications of public officials furnishedto us without undertaking to verify the same byindependent investigation The 2016BBond is issued by the Borough pursuant to Resolution No FY2016-06 the Resolution under and in accordance with the Constitution and laws of theState of Alaska and the ordinances and resolutions of the Borough We have not been engaged to review and thus express no opinion concerning the completeness or accuracy of any official statement offering circular or other sales or disclosure material relating to the issuance of the 201 6BBond or otherwise used in connection with the 201 6BBond orthe Alaska Municipal BondBank General Obligation and Refunding Bonds 2016 Series One the Bond Bank Bonds portion of the proceeds of which are being used to acquire the 201 6B Bond or otherwise used in connection with the 201 6BBond or the BondBank Bonds Under the Internal RevenueCode of 1986 as amended the Code the Borough is required to comply with certain requirements after thedate of issuance of the 2016BBond in orderto maintain the exclusion of the interest on the 2016BBond from gross income for federal income tax purposes including without limitation requirementsconcerning the qualified use of 201 6BBond proceeds and the facilities financed or refinanced with 2016B Bond proceeds limitations on investinggross proceeds of the 201 6BBond in higher yielding investments in certain circumstances and the arbitrage rebate requirement totheextent applicable tothe 2016B Bond The Borough has covenanted in the Resolution to comply with those requirements but if the Borough fails to comply with those requirements interest on the 201 6BBond could become taxableretroactiveto thedate of issuance of the 201 6B Bond We have not undertaken anddo notundertake to monitor the Boroughs compliance with such requirements Based upon the foregoing as of thedate of initial delivery of the 2016BBond tothe purchaser thereof and full payment therefor it is our opinion that under existing law TEL 206.447.4400 FAX 206.447.9700 1111 THIRD AVENUE SUITE3400 SEATTLE WASHINGTON 98101-3299 WWW.FOSTER.CoM SEATTLE WASHINGTON SPOKANE WASHINGTON 5l496338 Kodiak Island Borough Alaska Alaska Municipal BondBank February 2016 Page The Borough is duly organized and legallyexisting municipal corporation under the laws of theState of Alaska TheLoan Agreement between the Borough and the Alaska Municipal BondBank dated as of January 20 2016 relating to the 201 6B Bond hasbeen duly authorized executed and delivered by the Borough and is valid and binding obligation of the Borough enforceable against the Borough in accordance with its terms except only to the extentthat enforcement of payment may be limited by bankruptcy insolvency orother laws affecting creditors rights and by the application of equitable principles and the exercise ofjudicial discretion in appropriate cases The2016BBond hasbeen duly authorized and issued by the Borough and is issued in full compliance with the provisions of the Constitution and laws of theState of Alaska and the ordinances and resolutions of the Borough relating thereto The2016BBond constitutesvalid and binding general obligation of the Borough payable from annual ad valorem taxes to be levied without limitation as torateor amount on all of the taxable property within the Borough except only totheextentthat enforcement of payment may be limited by bankruptcy insolvency or other laws affecting creditors rights and by the application of equitable principles and the exercise ofjudicial discretion in appropriate cases Assuming compliance by the Borough after thedate of issuance of the 201 6BBond with applicable requirements of the Code the interest on the 2016BBond is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of thealternative minimum tax applicable to individuals however while interest on the 2016BBond also is not an item of tax preference for purposes of the alternative minimum tax applicable to corporations interest on the 2016B Bond received by corporations is to be taken into account in the computation of adjusted current earnings for purposes of the alternative minimum tax applicable to corporations interest on the 2016BBond received by certain corporations may be subject to tax and interest on the 2016BBond received by foreign corporations with United States branches may be subject to foreign branch profits tax Interest on the 2016BBond is free from taxation by the State of Alaska except for transfer estate and inheritance taxes and except to the extent interest on the 201 6BBond received by corporations and taken into account in the computation of adjusted current earnings for purposes of the alternative minimum tax applicable to corporations may affect the corresponding provisions of theState of Alaska corporate income tax We express no opinion regarding any otherfederalor state tax consequences of receipt of interest on the 2016B Bond This opinion is given as of the date hereof and we assume no obligation toreviseor supplement this opinion to reflect any factsor circumstances that may hereafter come to our aftention or any changes in law that may hereafter occur 5496338.1 Kodiak Island Borough Alaska Alaska Municipal BondBank February 2016 Page We bring to your attention the factthatthe foregoing opinions are expressions of our professional judgment on the matters expressly addressed anddo not constitute guarantees of result No attorney client relationship has existedorexists betweenour firm and the Alaska Municipal BondBank in connection with the 2016BBond or by virtue of this letter Respectfully submitted FOSTERPEPPER PLLC Ve4 Pu.c 496338.1 LEVESQUE LAW GROUP LLC 3380 Street Suite 202 Anchorage Alaska99503 JosephLevesque Shane Levesque Of Counsel Phone 907 261-8935 Fax 206 309-0667 Website Ievesquelawgroup.com February 2016 Kodiak Island Borough Alaska Alaska Municipal Bond Bank Re Kodiak Island Borough Alaska $5140000 General Obligation School Bond 2016 Series We haveserved as co-bond counsel to Kodiak Island Borough Alaska the Borough in connection with the issuance of the above-referenced bond the 2016B Bond and in that capacity have examined such law andsuch certified proceedings and other documents as we have deemed necessary to render this opinion As tomatters of fact material to this opinion we have relied upon representations contained in the certified proceedings and othercertifications of public officials furnished to us without undertaking to verify the same by independent investigation The 2016B Bond is issued by the Borough pursuant to Resolution No FY20 16-06 the Resolution under and in accordance with the Constitution and laws of theState of Alaska and the ordinances and resolutions of the Borough We have not been engaged to review and thus express no opinion concerning the completeness or accuracy of any official statement offering circular or other sales or disclosure material relating to the issuance of the 201 6B Bond or otherwise used in connection with the 201 6BBond or the Alaska Municipal Bond Bank General Obligation and Refunding Bonds 2016 Series One the Bond Bank Bonds portion of the proceeds of which are being used to acquire the 2016B Bond or otherwise used in connection with the 201 6BBond or the Bond Bank Bonds Under the Internal Revenue Code of 1986 as amended the Code the Borough is required to comply with certain requirements after thedate of issuance of the 201 6B Bond in orderto maintain the exclusion of the interest on the 201 6BBond from gross LEVESQUE LAW GROUP LLC Kodiak Island Borough Alaska Municipal BondBank February 2016 Page income for federal income tax purposes including without limitation requirements concerning the qualified use of 2016B Bond proceeds and the facilities financed or refinanced with 201 6BBond proceeds limitations on investing gross proceeds of the 201 6B Bond in higher yielding investments in certain circumstances and the arbitrage rebate requirement to the extent applicable to the 201 6B Bond The Borough has covenanted in the Resolution to comply with those requirements but if the Borough fails to comply with those requirements interest on the 2016BBond could become taxable retroactive to thedate of issuance of the 2016B Bond We have not undertaken anddo not undertake to monitor the Boroughs compliance with such requirements Based upon the foregoing as of thedate of initial delivery of the 2016BBond to the purchaser thereof and full payment therefor it is our opinion that under existing law The Borough is duly organized and legally existing municipal corporation under the laws of theState of Alaska The Loan Agreement between the Borough and the Alaska Municipal Bond Bank dated as of January 20 2016 relating to the 201 6B Bond hasbeen dulyauthorized executedand delivered by the Borough and is valid and binding obligation of the Borough enforceable against the Borough in accordance with its terms except only tothe extentthat enforcement of payment may be limited by bankruptcyinsolvency or other laws affecting creditors rights and by the application of equitable principles and the exercise of judicial discretion in appropriate cases The 2016B Bond hasbeen duly authorized and issued by the Borough and is issued in full compliance with the provisions of the Constitution and laws of theState of Alaska and the ordinances and resolutions of the Borough relating thereto The 2016B Bond constitutes valid and binding general obligation of the Borough payable from annual ad valorem taxes to be levied without limitation as to rate or amount on all of the taxable property within the Borough except only to the extent that enforcement of payment may be limited by bankruptcy insolvency or other laws affecting creditors rights and by the application of equitable principles and the exercise of judicial discretion in appropriate cases Assuming complianceby the Borough after thedate of issuance of the 2016B Bond with applicable requirements of the Code the interest on the 201 6B Bond is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the alternative minimum tax applicable to individuals however while interest LEVESQUE LAW GROUP LLC Kodiak Island Borough Alaska Municipal BondBank February 2016 Page 13 on the 201 6BBond also is not an item of tax preference for purposes of the alternative minimum tax applicable to corporations interest on the 2016BBond received by corporations is to betaken into account in the computation of adjusted current earnings for purposes of the alternative minimum tax applicable to corporations interest on the 201 6B Bond received by certain corporations may be subject to tax and interest on the 2016B Bond received by foreign corporations with United States branches may be subject to foreign branch profits tax Interest on the 2016B Bond is free from taxation by theState of Alaska except for transfer estate and inheritance taxes and except tothe extentinterest on the 2016B Bond received by corporations andtaken into account in the computation of adjusted current earnings for purposes of the alternative minimum tax applicable to corporations may affect the correspondingprovisions of theState of Alaska corporate income tax We express no opinion regardingany otherfederalor state tax consequences of receipt of interest on the 2016B Bond This opinion is given as of thedate hereof and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention or any changes in law that may hereafter occur We bring to your attention thefact that the foregoingopinions are expressions of our professional judgment on the matters expressly addressedanddo not constitute guarantees of result No attorney-client relationship has existed or exists between our firm and the Alaska Municipal Bond Bank in connection with the 2016BBond or by virtue of this letter Respectfully submitted LEVESQUE LAW GROUP LLC JosephLevesque