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Orrkk, Herrngton & Sutdffe LLP
November 3, 2016 701 Sth Avenue
Suite 5600
Seattle, WA 98104-7097
Alaska Municipal Bond Bank +1206 839 4300
Juneau, Alaska orrickcom
Alaska Municinal Bond Bank General Obligation and Refundina Bonds,
2016 Series Three and Four
(Final Opinion)
Ladies and Gentlemen:
We have acted as bond counsel to the Alaska Municipal Bond Bank (the "Bond Bank")
in connection with issuance of $80,435,000 aggregate principal amount of Alaska Municipal
Bond Bank General Obligation and Refunding Bonds, 2016 Series Three (the "2016 Series Three
Bonds"), and $29,400,000 aggregate principal amount of Alaska Municipal Bond Bank General
Obligation and Refunding Bonds, 2016 Series Four (the "2016 Series Four Bonds" and together
with the 2016 Series Three Bonds, the "Bonds"), issued pursuant to the General Obligation Bond
Resolution, adopted by the Board of Directors (the "Board") of the Bond Bank on July 13, 2005
(as amended, the "2005 General Bond Resolution"), as supplemented by Resolution No. 2016-
05, adopted by the Board on September 6, 2016 (the "2016 Series Three and Four Resolution"
and together with the 2005 General Bond Resolution, the "Bond Resolution"). The Bond 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 a loan to
the City and Borough of Juneau, Alaska ("Juneau"), a Governmental Unit, to refund bonds
issued by Juneau to finance a school project and a loan to finance costs of a transit project;
(ii) making a loan to the City of Ketchikan, Alaska (the "City of Ketchikan"), a Governmental
Unit, to finance harbor projects; (iii) making loans to the City of Ketchikan and to thirteen other
Governmental Units to refund Municipal Bonds previously issued to the Bond Bank by the
Governmental Units to finance or refinance projects and to refund corresponding portions of
bonds previously issued by the Bond Bank; (iv) purchasing a surety policy in substitution for
amounts currently on deposit in the Reserve Fund; and (v) paying costs of issuing the Bonds. In
connection with such loans, the Bond Bank is purchasing Municipal Bonds issued by the
Governmental Units to secure payments to be made pursuant to the Loan Agreements and
Amendatory 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 October 18, 2016 (the "Juneau Loan Agreement"), between the Bond Bank and Juneau; the
Loan Agreement, dated as of October 18, 2016, and the Loan Agreement, dated as of July 1,
2006, as amended by the Amendatory Loan Agreement, dated as of October 18, 2016 (together,
the "City of Ketchikan Loan Agreements"), each between the Bond Bank and the City of
Ketchikan; each of the Loan Agreements and Amendatory Loan Agreements (collectively,
November 3, 2016 701 5th Avenue
Suite 5600
Seattle, WA 98104-7097
Alaska Municipal Bond Bank +1206 839 4300
Juneau, Alaska orrck.com
Alaska Municipal Bond Bank General Obligation and Refunding Bonds,
2016 Series Three and Four
(Final Opinion)
Ladies and Gentlemen:
We have acted as bond counsel to the Alaska Municipal Bond Bank (the "Bond Batik")
in connection with issuance of $80,435,000 aggregate principal amount of Alaska Municipal
Bond Bank General Obligation and Refunding Bonds, 2016 Series Three (the "2016 Series Three
Bonds"), and $29,400,000 aggregate principal amount of Alaska Municipal Bond Bank General
Obligation and Refunding Bonds, 2016 Series Four (the "2016 Series Four Bonds" and together
with the 2016 Series Three Bonds, the "Bonds"), issued pursuant to the General Obligation Bond
Resolution, adopted by the Board of Directors (the "Board") of the Bond Bank on July 13, 2005
(as amended, the "2005 General Bond Resolution"), as supplemented by Resolution No. 2016-
05, adopted by the Board on September 6, 2016 (the "2016 Series Three and Four Resolution"
and together with the 2005 General Bond Resolution, the "Bond Resolution"). The Bond Bank
has appointed The Bank of New York Mellon Trust Company, NA., as trustee (the "Trustee")
under the Bond Resolution. The Bonds are issued for the stated purposes of: (i) making a loan to
the City and Borough of Juneau, Alaska ("Juneau"), a Governmental Unit, to refund bonds
issued by Juneau to finance a school project and a loan to finance costs of a transit project;
(ii) making a loan to the City of Ketchikan, Alaska (the "City of Ketchikan"), a Governmental
Unit, to finance harbor projects; (iii) making loans to the City of Ketchikan and to thirteen other
Governmental Units to refund Municipal Bonds previously issued to the Bond Bank by the
Governmental Units to finance or refinance projects and to refund corresponding portions of
bonds previously issued by the Bond Bank; (iv) purchasing a surety policy in substitution for
amounts currently on deposit in the Reserve Fund; and (v) paying costs of issuing the Bonds. In
connection with such loans, the Bond Bank is purchasing Municipal Bonds issued by the
Governmental Units to secure payments to be made pursuant to the Loan Agreements and
Amendatory 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 October 18, 2016 (the "Juneau Loan Agreement"), between the Bond Bank and Juneau; the
Loan Agreement, dated as of October 18, 2016, and the Loan Agreement, dated as of July 1,
2006, as amended by the Amendatory Loan Agreement, dated as of October 18, 2016 (together,
the "City of Ketchikan Loan Agreements"), each between the Bond Bank and the City of
Ketchikan; each of the Loan Agreements and Amendatory Loan Agreements (collectively,
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Alaska Municipal Bond Bank
November 3, 2016
Page 2
together with the Juneau Loan Agreement and the City of Ketchikan Loan Agreements, the
"Loan Agreements") between the Bond Bank and the Aleutians East Borough, the City and
Borough of Sitka, the City of Bethel, the City of Dillingham, the City of Kodiak, the City of
Nome, the Petersburg Borough, the City of Seward, the City of Wasilla, the Kenai Peninsula
Borough, the Kodiak Island Borough, the Municipality of Skagway and the Northwest Artic
Borough (together with Juneau and the City of Ketchikan, the "Governmental Units"); the Tax
Certificate, dated the date hereof, of the Bond Bank (the "Tax Certificate"); authorizing
ordinances and resolutions and tax certificates of each of the Governmental Units; a Certificate
of the State of Alaska Department of Law, as counsel to the Bond Bank; the debt service reserve
fund surety policy (the "Reserve Fund Surety") issued by National Public Finance Guarantee
Corporation ("National"), in its capacity as provider of the Reserve Fund Surety (the "Reserve
Fund Surety Provider"); the financial guaranty insurance policy (the "Bond Insurance Policy")
issued by National, in its capacity as provider of the Bond Insurance Policy (the "Bond Insurer");
opinions of counsel to the Governmental Units; certificates of the Bond 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 Bond 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, each of the Loan Agreements, the Municipal
Bonds and the Tax Certificate and their enforceability may be subject to bankruptcy, insolvency,
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Alaska Municipal Bond Bank
November 3, 2016
Page 3
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 (the "State"). 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 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 Bond
I:TflfJ
2. The Bond Resolution has been duly adopted by, and constitutes the valid and
binding obligation of, the Bond 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 2016 Series Three Bonds is excluded from gross income for
federal income tax purposes under Section 103 of the Internal Revenue Code of 1986. Interest
on the 2016 Series Three 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 2016 Series Four Bonds is excluded from gross income for federal income tax
purposes under Section 103 of the Internal Revenue Code of 1986, except that no opinion is
expressed as to the status of interest on any 2016 Series Four Bond for any period that such 2016
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Alaska Municipal Bond Bank
November 3, 2016
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Series Four Bond is held by a "substantial user" of the facilities financed or refinanced by the
2016 Series Four Bonds or by a "related person" within the meaning of Section 147(a) of the
Internal Revenue Code of 1986. Interest on the 2016 Series Four Bonds is a specific preference
item for purposes of the federal individual and corporate alternative minimum taxes. 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,