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HomeMy WebLinkAboutCouncil Packet - 4/18/2023CITY OF %44TERLOO IOWA THE CITY COUNCIL OF WATERLOO, IOWA SPECIAL SESSION TO BE HELD AT Harold E. Getty Council Chambers Tuesday, April 18, 2023 4:00 PM CITY OF WATERLOO COMMUNITY VISION PLAN 1 Fly the W: To develop a sense of pride and relationship between residents and the City of Waterloo, and then leverage that pride to communicate the City's attributes to external audiences. 2. Elevate Housing: Redevelop, renovate, or improve 800 residences in Waterloo in eight years by providing access to capital. 3. Celebrate and Connect Neighborhoods: To leverage Waterloo's rich tradition of neighborhoods by celebrating and connecting them with the community and region at large. 4. Waterloo Works: Grow a diverse and skilled workforce in Waterloo that connects people and employers for mutual growth. 5. Crossroads Doubledown: Re -energize Crossroads Mall area into a sports/recreation themed gravitational center. 6. Power Up Downtown: Keep Waterloos core downtown evolving to meet the needs of future generals, supporting and showcasing arts and cultural opportunities and creating an experience like no other. 7. Sportstown USA: To generate excitement, develop youth, and drive investment and economic impact from year-round visitors. 8. Community of Opportunity: Eliminate barriers that keep Waterloo residents, and the community as a whole, from reaching its true potential, creating an equitable, thriving, and sustainable community for future generations. Waterloo is a Community of Opportunity, where everyone can prosper. GENERAL RULES FOR PUBLIC PARTICIPATION SPECIAL SESSION AGENDA A. Iowa Code Chapter 21 gives the public the right to attend council meetings, but it does not require cities to allow public participation except during public hearings. The public is required to follow the rules listed in this article when speaking during any meeting of the city council. Page 1 of 24 B. At the presiding officer's discretion, individuals may address the presiding officer by stepping to the podium, and after recognition by the presiding officer, shall state their name, address and group affiliation, if appropriate, and speak clearly into the microphone. C. Comments shall be germane and refrain from personal, impertinent, or slanderous remarks. D. Cell phones and electronic devices shall be set to silent prior to the start of the meeting. GENERAL RULES FOR PUBLIC COMMENT A. Individuals shall speak one (1) time on only one (1) issue for a maximum of three (3) minutes During the public comment section of the agenda. The public shall not be required to pre -register to speak during public comment. Individuals shall only speak on matters not listed on the regular agenda for that date. Any matter presented shall be directed to the presiding officer and addressed, if necessary, after the meeting. B. Council members may speak during public comment portion of the agenda after the public has finished speaking C. City staff shall not be required to provide an immediate answer to a matter presented during a council meeting unless it specifically pertains to an item on the agenda RULES FOR PUBLIC COMMENT DURING PUBLIC HEARINGS Individuals may speak during the public comment portion of a scheduled public hearing for a maximum of three (3) minutes or may submit written comments to the city clerk by four o'clock (4:00) P.M. on the day of the public hearing. Groups of citizens with similar viewpoints are encouraged to select a representative to share the viewpoint of the group. RULES FOR PUBLIC COMMENT DURING AGENDA ITEMS At the discretion of the presiding officer, individuals may speak for a maximum of three (3) minutes when the council discusses agenda items. This section does not apply to businesses or parties directly involved in agenda items. Roll Call. Approval of Agenda. OTHER COUNCIL BUSINESS 1. Motion to receive and file copies of Calls. A. Motion to approve the following: 1. Receive and file proof of publication of Notice of Sale. 2. Resolution Directing Sale of $6,000,000.00 (Subject to Adjustment Per Terms of Offering) General Obligation Bonds, Series 2023A. Page 2 of 24 ADJOURNMENT Motion to adjourn. 1. Motion to adjourn. Kelley Felchle City Clerk Page 3 of 24 CITY OF J ,ATERLOO �. COMMUNICATION TO THE WATERLOO CITY COUNCIL NAME AND DEPARTMENT MEETING DATE City Clerk Department April 18, 2023 AGENDA ITEM TITLE Motion to receive and file copies of Calls. A. Motion to approve the following: 1. Receive and file proof of publication of Notice of Sale. 2. Resolution Directing Sale of $6,000,000.00 (Subject to Adjustment Per Terms of Offering) General Obligation Bonds, Series 2023A. RECOMMENDED COUNCIL ACTION SUMMARY STATEMENT AND BACKGROUND INFORMATION NEIGHBORHOOD IMPACT DATA, ANALYSIS, AND STRATEGIES IMPLEMENTATION, ACCOUNTABILITY, AND COMMUNICATION COMMUNITY ENGAGEMENT METHODS SOURCE OF EXPENDITURES ALTERNATIVE ACTION LEGAL DESCRIPTION Page 4 of 24 ATTACHMENTS 1. Resolution - Sale -Award Proceedings 2023A GO BONDS (02183659x7F7E1) 2. 23A Waterloo 6m GO Award Packet Page 5 of 24 ITEMS TO INCLUDE ON AGENDA CITY OF WATERLOO, IOWA $6,000,000* (Subject to Adjustment per Terms of Offering) General Obligation Bonds, Series 2023A • Receipt of bids. • Resolution directing sale. NOTICE MUST BE GIVEN PURSUANT TO IOWA CODE CHAPTER 21 AND THE LOCAL RULES OF THE CITY. Page 6 of 24 April 18, 2023 The Finance Manager of the City of Waterloo, State of Iowa, or her designee, met in City Hall, 715 Mulberry Street, Waterloo, Iowa, at 10:30 A.M., on the above date, to open sealed bids received, access electronic bids and to refer the sale of the Bonds to the best and most favorable bidder for cash, subject to approval by the City Council at 4:00 P.M. on the above date. The following persons were present: * * * * * * * * 1 Page 7 of 24 This being the time and place for the opening of bids for the sale of $6,000,000* (Subject to Adjustment per Terms of Offering) General Obligation Bonds, Series 2023A, the meeting was opened for the receipt of bids for the Bonds. The following actions were taken: 1. Sealed bids were filed and listed in the minutes while unopened, as follows: Name & Address of Bidders: (Attach List of Bidders) 2. The City Clerk then declared the time for filing of sealed bids to be closed and that the sealed bids be opened. The sealed bids were opened and announced. 3. Electronic bids received were accessed and announced as follows: Name & Address of Bidders: (Attach List of Bidders) 4. The best bid was determined to be as follows: Name & Address of Bidder: True Interest Rate (as -bid): Net Interest Cost (as -bid): $ % In consultation with Speer Financial, Inc., the City's Municipal Advisor, the City considered the adjustment of the aggregate principal amount of the Bonds and each scheduled maturity thereof in accordance with the Terms of Offering and the following actions were taken: Final Par Amount as adjusted: $ Purchase Price as adjusted: $ All bids were then referred to the Council for action. 2 Page 8 of 24 April 18, 2023 The City Council of the City of Waterloo, State of Iowa, met in session, in the Council Chambers, City Hall, 715 Mulberry Street, Waterloo, Iowa, at .M., on the above date. There were present Mayor Quentin Hart, in the chair, and the following named Council Members: Absent: Vacant: 3 Page 9 of 24 Council Member introduced the following Resolution entitled "RESOLUTION DIRECTING SALE OF $6,000,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) GENERAL OBLIGATION BONDS, SERIES 2023A," and moved its adoption. Council Member seconded the motion to adopt. The roll was called and the vote was, AYES: NAYS: Whereupon, the Mayor declared the following Resolution duly adopted: RESOLUTION DIRECTING SALE OF $6,000,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) GENERAL OBLIGATION BONDS, SERIES 2023A WHEREAS, bids have been received for the Bonds described as follows and the best bid received (with permitted adjustments, if any) is determined to be the following: $6,000,000* (SUBJECT TO ADJUSTMENT PER TERMS OF OFFERING) GENERAL OBLIGATION BONDS, SERIES 2023A Bidder: The terms of award: Final Par Amount as adjusted: $ Purchase Price as adjusted: $ True Interest Rate: of Net Interest Cost: $ % 4 Page 10 of 24 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATERLOO, STATE OF IOWA: Section 1. That the bid for the Bonds as above set out is hereby determined to be the best and most favorable bid received and, the Bonds are hereby awarded as described above. Section 2. That the statement of information for Bond bidders and the form of contract for the sale of the Bonds are hereby approved and the Mayor and Clerk are authorized to execute the same on behalf of the City. Section 3. That the notice of the sale of the Bonds heretofore given and all acts of the Clerk done in furtherance of the sale of the Bonds are hereby ratified and approved. PASSED AND APPROVED this 18th day of April, 2023. ATTEST: Kelley Felchle, City Clerk Quentin Hart, Mayor 5 Page 11 of 24 STATE OF IOWA COUNTY OF BLACK HAWK CERTIFICATE ) ) SS ) I, the undersigned City Clerk of the City of Waterloo, State of Iowa, do hereby certify that attached is a true and complete copy of the portion of the records of the City showing proceedings of the Council, and the same is a true and complete copy of the action taken by the Council with respect to the matter at the meeting held on the date indicated in the attachment, which proceedings remain in full force and effect, and have not been amended or rescinded in any way; that meeting and all action thereat was duly and publicly held in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council pursuant to the local rules of the Council and the provisions of Chapter 21, Code of Iowa, upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by law and with members of the public present in attendance; I further certify that the individuals named therein were on the date thereof duly and lawfully possessed of their respective City offices as indicated therein, that no Council vacancy existed except as may be stated in the proceedings, and that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City or the right of the individuals named therein as officers to their respective positions. WITNESS my hand and the seal of the Council hereto affixed this day of , 2023. Kelley Felchle, City Clerk, City of Waterloo, State of Iowa (SEAL) 02183 659-1 \ 11310-158 Page 12 of 24 urSpeer Financial, Inc. INDEPENDENT MUNICIPAL ADVISORS ESTABLISHED 1954 DANIEL FORBES President RAPHALIATA McKENZIE MAGGIE BURGER ANTHONY MICELI MARK JERETINA AARON GOLD Senior Vice President Senior Vice President Senior Vice President Senior Vice President Vice President April 18, 2023 The Honorable Quentin Hart, Mayor and Members of the City Council City of Waterloo 715 Mulberry Street Waterloo, IA 50703 Dear Mayor Hart and Council Members: Bids were received today for the $6,000,000 General Obligation Bonds, Series 2023A. One bid was received, which is listed at the bottom of this letter. Upon examination, it is our opinion that the bid of Robert W. Baird & Co., Inc., Milwaukee, Wisconsin, is the best bid received, and it is further our opinion that the bid is favorable to the City and should be accepted. We therefore recommend the Bonds be awarded to that bidder at a price of $6,292,049, being at a true interest rate of 3.3288%. True Account Managers Interest Rate Robert W. Baird & Co., Inc., Milwaukee, Wisconsin 3.3364% (Original) 3.3288% (Revised) MB/cn Enclosures Respectfully submitted, SPEER FINANCIAL, INC. -IYI, co-lArr Maggie Burger, Sr. Vice President SUITE 2630 • 230 WEST MONROE STREET • CHICAGO, ILLINOIS 60606 • (312) 346-3700 • FAX (312) 346-8833 SUITE 608 • 531 COMMERCIAL STREET • WATERLOO, IOWA 50701 • (319) 291-2077 • FAX (319) 291-8628 Page 13 of 24 U.S. PUBLIC FINANCE MOODY'S INVESTORS SERVICE CREDIT OPINION 13 April 2023 V Send Your Feedback Contacts Natalie Claes AVP-Analyst natalie.claes@moodys.com Robert Weber VP -Senior Analyst robertweber@moodys.com +1.312.706.9973 +1.212.553.7280 CLIENT SERVICES Americas 1-212-553-1653 Asia Pacific 852-3551-3077 Japan 81-3-5408-4100 EMEA 44-20-7772-5454 City of Waterloo, IA Update to credit analysis Summary Waterloo (Aa2) maintains a solid financial position and benefits from its role as an employment hub. Leverage and fixed costs are moderate. These strengths are balanced against the city's below average economic metrics. Credit strengths » Solid financial position » Moderate leverage and fixed costs Credit challenges » Below -average resident income and full value per capita Economic growth trails the nation Rating outlook Moody's does not typically assign outlooks to local governments with this amount of debt. Factors that could lead to an upgrade Substantial strengthening of economic metrics » Further bolstering of operating reserves Factors that could lead to a downgrade Narrowing of financial position » Materially increased leverage or fixed cost burden Page 14 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Key indicators Exhibit Waterloo (City of) IA 2019 2020 2021 2022 Aa Medians Economy Resident income ratio (%) 81.2% 79.7% 80.6% N/A 115.4% Full Value ($000) $4,066,424 $4,094,624 $4,333,259 $4,435,219 $2,728,197 Population 67,912 67,671 67,695 N/A 23,462 Full value per capita ($) $59,878 $60,508 $64,012 N/A $108,666 Economic growth metric (%) N/A -3.1% -0.4% N/A -0.6% Financial Performance Revenue ($000) $127,242 $127,971 $141,716 $151,721 $50,065 Available fund balance ($000) $34,297 $35,113 $36,973 $43,933 $25,773 Net unrestricted cash ($000) $102,304 $96,009 $93,049 $100,952 $34,793 Available fund balance ratio (%) 27.0% 27.4% 26.1% 29.0% 51.2% Liquidity ratio (%) 80.4% 75.0% 65.7% 66.5% 69.5% Leverage Debt ($000) $107,172 $109,711 $132,105 $159,940 $35,801 Adjusted net pension liabilities ($000) $169,823 $207,360 $262,742 $213,685 $58,004 Adjusted net OPEB liabilities ($000) $20,249 $21,303 $19,999 $16,385 $6,701 Other long-term liabilities ($000) $5,451 $5,829 $7,232 $7,228 $1,659 Long-term liabilities ratio (%) 237.9% 269.0% 297.8% 261.8% 248.8% Fixed costs Implied debt service ($000) $8,069 $7,814 $7,857 $9,266 $2,504 Pension tread water contribution ($000) $5,709 $5,955 $6,658 N/A $1,672 OPEB contributions ($000) $1,989 $2,079 $2,165 $1,626 $193 Implied cost of other long-term liabilities ($000) $411 $397 $417 $507 $113 Fixed -costs ratio (%) 12.7% 12.7% 12.1% 11.9% 11.2% For definitions of the metrics in the table above please refer to the US Cities and Counties Methodology or see the Glossary in the Appendix below. Metrics represented as N/A indicate the data were not available at the time of publication. The medians come from our most recently published US Cities and Counties Median Report. The Economic Growth metric cited above compares the five-year CAGR of real GDP for Waterloo -Cedar Falls, IA Metropolitan Statistical Area to the five-year CAGR of real GDP for the US. Sources: US Census Bureau, Waterloo (City of) IA's financial statements and Moody's Investors Service, US Bureau of Economic Analysis Profile The City of Waterloo encompasses 64 square miles in northeastern Iowa (Aaa stable), approximately 50 miles northwest of Cedar Rapids (Aa1 stable). It serves as the county seat of Black Hawk County (Aa2) and has a population of just under 68,000. Detailed credit considerations Economy: regional economic hub Waterloo will continue to benefit from its role as a regional commercial and industrial hub. The MSA's real GDP output has rebounded sharply following a pandemic -related drop, however longer -term economic growth continues to trail the nation. Development remains steady within the city, with approximately 250 housing units currently under construction, and median home sale prices have risen more than 30% over the past five years. While the tax base is growing, however, the population has declined a modest 1% since the 2010 census. Both full value per capita and adjusted resident income remain below average at roughly $65,500 and 81%, respectively. The city's largest employer is John Deere (Deere & Company, A2 positive), which employs approximately 5,000 people, followed by United Point Health Care (3,160 employees) and Tyson Fresh Meats, Inc. (3,000 employees). As of February 2023, the city's unemployment rate was 4%, above both the state (3.3%) and nation (3.9%). Financial operations: stable financial position Waterloo's financial position is stable, characterized by solid liquidity and strong enterprise operations. On a budgetary basis, the general fund is expected to decline approximately $1.3 million in fiscal 2023 (year-end June 30) as the city expends American Rescue This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the issuer/deal page on https://ratings.moodys.com for the most updated credit rating action information and rating history. 2 13 April 2023 City of Waterloo, IA: Update to credit analysis Page 15 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Plan Act (ARPA) funding. Roughly 16% the city's revenue comes from business -type activities (see Exhibit 2), which consist of a sanitary sewer and sanitation enterprises. Both posted positive operations in fiscal 2022 and maintain satisfactory reserves. Combined with resources across governmental funds, Waterloo closed fiscal 2022 with an available fund balance ratio of 29% (see Exhibit 3). Governmental activities are funded primarily through property taxes (42% of fiscal 2022 governmental revenue), intergovernmental revenue (21%), and local sales taxes (11%). Exhibit 2 Exhibit 3 Majority of Waterloo's revenue is from governmental activities Historically stable financial position Business -type activities I 16% Governmental funds 84% Sources: Waterloo (City of) IA's financial statements and Moody's Investors Service $50 $45 $40 $35 ,, $30 o $25 £ $20 $15 $10 $5 $0 Business -type activities Governmental funds Available fund balance ratio (right axis) 2018 2019 2020 2021 2022 Sources: Waterloo (City of) IA's financial statements and Moody's Investors Service Liquidity The city closed fiscal 2022 with a net cash position of $101 million, equal to a robust 67% of revenue (see Exhibit 4). Exhibit 4 Strong liquidity position E $120 $100 $80 $60 $40 $20 $0 General fund Other governmental funds Business -type activities Net cash ratio (right axis) 2018 2019 2020 2021 2022 Sources: Waterloo (City of) IA's financial statements and Moody's Investors Service 35% 30% 25% 20% 15% 10% 5% 0% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Leverage: moderate leverage and fixed costs Waterloo's leverage and fixed costs are moderate and will grow over the near term given the city's additional borrowing plans. The city is currently issuing $6 million in general obligation unlimited tax (GOULT) debt for capital improvements and urban renewal projects. When incorporating Moody's adjusted pension and other -post employment (OPEB) Liabilities, post -sale leverage is slightly above average at 266% of fiscal 2022 revenue (see Exhibit 5). The fixed costs ratio was roughly 12% of revenue in fiscal 2022, and consist primarily of debt service (see Exhibit 6). The city plans to issue $14 million in sewer revenue bonds in the current year. Waterloo's future borrowing plans include $26 million in GOULT debt in 2024, including $20 million authorized by voter in 2022 for fiber-optic broadband projects. Approximately $6 million GOULT debt is expected in 2025. The city also anticipates borrowing $18.5 3 13 April 2023 City of Waterloo, IA: Update to credit analysis Page 16 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE million and $10 million in sewer revenues bonds in 2024 and 2025, respectively. The majority of sewer borrowing will be in the form of state revolving fund loans to take advantage of more favorable interest rates. Exhibit 5 Post -sale leverage will remain moderate Exhibit 6 Fixed costs a fairly even split of debt service and retiree benefit costs Other long-term liabilities Adj. NOL Implied debt service Pension tread water ri ANPL — Debt OPEB contribution • - Other implied carrying costs Long-term liabilities ratio (right axis) Fixed -costs ratio (right axis) $20 $500 350% $18 300% $16 ■ 250% $14 w $300 � 1 / 210°0°-, c $12 E $200 s100 $0 0% $0 $400 2018 2019 2020 2021 2022 post -sale r 2019 2020 2021 2022 Sources: Waterloo (City of) IA's financial statements and Moody's Investors Service Sources: Waterloo (City of) IA's financial statements and Moody's Investors Service Legal security The city's GOULT debt is backed by a dedicated property tax levy unlimited as to rate or amount. 14% 12% 10% 8% 6% 4% 2% 0% Debt structure Following an upcoming sale, the city will have $122.6 million in GOULT debt outstanding. Waterloo's sewer enterprise had $31 million in state revolving fund loans outstanding at the close of fiscal 2022. All of the city's long-term debt is fixed rate. Amortization of GOULT debt is average with 81% of principal retired within 10 years. Debt -related derivatives The city has no exposure to any debt -related derivatives. Pensions and OPEB The city participates in two defined benefit multi -employer cost sharing plans, the Iowa Public Employees' Retirement System (IPERS) and Municipal Fire and Police Retirement System of Iowa (MFPRSI). On an annual basis, each plan establishes local government retirement contributions as a share of payroll based on actuarial requirements. Moody's ANPL uses the cost -sharing plan allocation of plan liabilities and fair market value of assets reported by the city under GASB 68 but reflects the use of the FTSE Pension Liability Index, a high investment -grade long-term taxable bond index, to value the plan's liabilities. The city's other post -employment benefit (OPEB) liability is very small and stems from an implicit rate subsidy. 4 13 April 2023 City of Waterloo, IA: Update to credit analysis Page 17 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE ESG considerations Waterloo (City of) IA's ESG Credit Impact Score is Neutral -to -Low CIS-2 Exhibit 7 ESG Credit Impact Score CIS-2 Neutral -to -Low may NEGATIVE IMPACT . POSITIVE . IMPACT For an issuer scored CIS-2 (Neutral -to -Low), its ESG attributes are overall considered as having a neutral -to -low impact on the current rating; i.e., the overall influence of these attributes on the rating is non -material. Source: Moody's Investors Service Waterloo's ESG Credit Impact Score is neutral -to -low (CIS-2), reflecting moderately negative exposure to environmental risks, and neutral to low exposure to social and governance risks. Exhibit 8 ESG Issuer Profile Scores ENVIRONMENTAL SOCIAL GOVERNANCE Moderately Negative Source: Moodys Investors Service S-2 G-2 Neutral -to -Low Neutral -to -Low ■u— Environmental The city's overall environmental issuer profile score is moderately -negative (E-3). While carbon transition, natural capital, and pollution risks are low, the city has some exposure to flooding given its location on the Cedar River. The river crested at historic levels in 2008 from intense rainfall which led to notable flooding and property damage. Some flooding occurred again in 2016. Investments in flood protection have totaled over $20 million since 2008, with funding from state, federal and local sources. The city also has a consent decree with the US EPA to address combined sewer overflows, which will require significant investment from the city over the next several years. Social Exposure to social risk is neutral -to -low (S-2). Overall demographic trends, educational attainment and health and safety are in line with peers. Governance Waterloo's governance profile score is neutral -to -low (G-2). The city has a strong institutional structure and a history of prudent budget management with maintenance of strong reserves, with very little risk related to policy credibility or transparency and disclosure. ESG Issuer Profile Scores and Credit Impact Scores for the rated entity/transaction are available on Moodys.com. In order to view the latest scores, please click here to go to the landing page for the entity/transaction on MDC and view the ESG Scores section. 5 13 ApriL 2023 City of Waterloo, IA: Update to credit analysis Page 18 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Rating methodology and scorecard factors The US Cities and Counties Rating Methodology includes a scorecard, which summarizes the rating factors generally most important to city and county credit profiles. Because the scorecard is a summary, and may not include every consideration in the credit analysis for a specific issuer, a scorecard -indicated outcome may or may not map closely to the actual rating assigned. Exhibit 9 Waterloo (City of) IA Measure Weight Score Economy Resident income ratio 80.6% 10.0% A Full value per capita Economic growth metric 65,518 10.0% A -0.4% 10.0% Aa Financial Performance Available fund balance ratio Liquidity ratio Institutional Framework 29.0% 20.0% Aa 66.5% 10.0% Aaa Institutional Framework Aa 10.0% Aa Leverage Long-term liabilities ratio Fixed -costs ratio 261.8% 20.0% A 11.9% 10.0% Aa Notching factors No notchings applied Scorecard -Indicated Outcome Aa3 Assigned Rating Aa2 Sources: US Census Bureau, Waterloo (City of) IA's financial statements and Moody's Investors Service 6 13 ApriL 2023 City of Waterloo, IA: Update to credit analysis Page 19 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Appendix Exhibit 10 Key Indicators Glossary Definition Typical Source* Economy Resident income ratio Median Household Income (MHI) for the city or county, adjusted for MHI: US Census Bureau - American Regional Price Parity (RPP), as a % of the US MHI Community Survey 5-Year Estimates RPP: US Bureau of Economic Analysis Full value Estimated market value of taxable property in the city or county State repositories; audited financial statements; continuing disclosures Population Population of the city or county US Census Bureau - American Community Survey 5-Year Estimates Full value per capita Full value / population Economic growth metric Five year CAGR of real GDP for Metropolitan Statistical Area or county minus the five-year CAGR of real GDP for the US Real GDP: US Bureau of Economic Analysis Financial performance Revenue Sum of revenue from total governmental funds, operating and non- Audited financial statements operating revenue from total business -type activities, and non - operating revenue from internal services funds, excluding transfers and one-time revenue, e.g., bond proceeds or capital contributions Available fund balance Sum of all fund balances that are classified as unassigned, assigned or Audited financial statements committed in the total governmental funds, plus unrestricted current assets minus current liabilities from the city's or county's business - type activities and internal services funds Net unrestricted cash Sum of unrestricted cash in governmental activities, business type Audited financial statements activities and internal services fund, net of short-term debt Available fund balance ratio Available fund balance (including net current assets from business - type activities and internal services funds) / Revenue Liquidity ratio Net unrestricted cash / Revenue Leverage Debt Outstanding long-term bonds and all other forms of long-term debt Audited financial statements; official across the governmental and business -type activities, including debt statements of another entity for which it has provided a guarantee disclosed in its financial statements Adjusted net pension liabilities (ANPL) Total primary government's pension liabilities adjusted by Moody's to Audited financial statements; Moody's standardize the discount rate used to compute the present value of Investors Service accrued benefits Adjusted net OPEB liabilities (ANOL) Total primary government's net other post -employment benefit (OPEB) liabilities adjusted by Moody's to standardize the discount rate used to compute the present value of accrued benefits Audited financial statements; Moody's Investors Service Other long-term liabilities (OLTL) Miscellaneous long-term liabilities reported under the governmental Audited financial statements and business -type activities entries Long-term liabilities ratio Debt + ANPL + ANOL + OLTL / Revenue Fixed costs Implied debt service Annual cost to amortize city or county's long-term debt over 20 Audited financial statements; official years with level payments statements; Moody's Investors Service Pension tread water contribution Pension contribution necessary to prevent reported unfunded pension liabilities from growing, year over year, in nominal dollars, if Investors Service all actuarial assumptions are met Audited financial statements; Moody's OPEB contribution Implied cost of OLTL City or county's actual contribution in a given period Annual cost to amortize city or county's other long-term liabilities over 20 years with level payments Audited financial statements Audited financial statements; Moody's Investors Service Fixed -costs ratio Implied debt service + Pension tread water + OPEB contributions + Implied cost of OLTL / Revenue *Note: If typical data source is not available then alternative sources or proxy data may be considered. For more detailed definitions of the metrics listed above please refer to the US City and Counties Methodology . Source: Moody's Investors Service 7 13 April 2023 City of Waterloo, IA: Update to credit analysis Page 20 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE © 2023 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their Licensors and affiliates (collectively, "MOODY'S"). All rights reserved. CREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT -LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY'S (COLLECTIVELY, "PUBLICATIONS") MAY INCLUDE SUCH CURRENT OPINIONS. MOODY'S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. 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REPORT NUMBER 1363789 8 13 April 2023 City of Waterloo, IA: Update to credit analysis Page 21 of 24 MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE CLIENT SERVICES Americas Asia Pacific Japan EMEA MOODY'S INVESTORS SERVICE 1-212-553-1653 852-3551-3077 81-3-5408-4100 44-20-7772-5454 9 13 April 2023 City of Waterloo, IA: Update to credit analysis Page 22 of 24 lin INDEPENDENT MUNICIPAL ADVISORS • ESTABLISHED 1954 Speer Financial, Inc. SUITE 608 • 531 COMMERCIAL STREET • WATERLOO, IOWA 50701 • (319) 291-2077 • FAX (319) 291-8628 Bidders* Robert W. Baird & Co., Milwaukee, Wisconsin Investment Rating: Moody's Investors Service ... Aa2 $6,000,000* CITY OF WATERLOO Black Hawk County, Iowa General Obligation Bonds, Series 2023A Price Inc. 104.892% $6,293,538.80 (Original) 104.867% $6,292,049.00 (Revised) C.L. King & Associates UMB Bank, N.A. Duncan -Williams, Inc. Carty & Company, Inc. FMS Bonds Inc. Midland Securities Multi Bank Securities Inc. Mountainside Securities LLC Sierra Securities Wayne Hummer & Co. Date of Sale: April 18, 2023 Average Life: 8.840 Years (Based on TIC) Revised Maturities Bid Par Par Rates 2024 $290,000 $360,000 4.000% 2025 305,000 305,000 4.000% 2026 315,000 315,000 4.000% 2027 330,000 330,000 4.000% 2028 340,000 340,000 4.000% 2029 355,000 355,000 4.000% 2030 370,000 370,000 4.000% 2031 385,000 385,000 4.000% 2032 405,000 405,000 4.000% 2033 425,000 425,000 4.000% 2034 450,000 450,000 4.000% 2035 470,000 470,000 4.000% 2036 495,000 495,000 4.000% 2037 520,000 495,000 4.000% 2038 545,000 500,000 4.000% Edward Jones Crews & Associates, Inc. Country Club Bank Celadon Financial Group, LLC Bernardi Securities, Inc. First Southern LLC Dinosaur Securities StoneX Financial Inc. First Kentucky Securities True Interest* * 3.3364% $1,828,061 (Original) 3.3288% $1,791,351 (Revised) Collier Securities Davenport & Co. L.L.C. Sierra Pacific Securities Oppenheimer & Co. Isaak Bond Investments, Inc. Northland Securities First Bankers' Banc Securities, Inc. Seaport Global Securities LLC Alliance Global Partners *Syndicate information is provided by the underwriter. The information contained in this report is the most current available. **The true interest rate reflects the time value of money where dollars spent in early years have a greater weight than dollars spent in later years. Page 23 of 24 Speer Financial, Inc. CITY OF WATERLOO, IOWA $6,000,000 GENERAL OBLIGATION BONDS, SERIES 2023A *** FINAL *** Debt Service Schedule Date Principal Coupon Interest Total P+I Fiscal Total 06/01/2023 - - - - - 12/01/2023 - - 120,000.00 120,000.00 - 06/01/2024 360,000.00 4.000% 120,000.00 480,000.00 600,000.00 12/01/2024 - - 112,800.00 112,800.00 - 06/01/2025 305,000.00 4.000% 112,800.00 417,800.00 530,600.00 12/01/2025 - - 106,700.00 106,700.00 - 06/01/2026 315,000.00 4.000% 106,700.00 421,700.00 528,400.00 12/01/2026 - - 100,400.00 100,400.00 - 06/01/2027 330,000.00 4.000% 100,400.00 430,400.00 530,800.00 12/01/2027 - - 93,800.00 93,800.00 - 06/01/2028 340,000.00 4.000% 93,800.00 433,800.00 527,600.00 12/01/2028 - - 87,000.00 87,000.00 - 06/01/2029 355,000.00 4.000% 87,000.00 442,000.00 529,000.00 12/01/2029 - - 79,900.00 79,900.00 - 06/01/2030 370,000.00 4.000% 79,900.00 449,900.00 529,800.00 12/01/2030 - - 72,500.00 72,500.00 - C;allable 06/01/2031 385,000.00 4.000% 72,500.00 457,500.00 530,000.00 12/01/2031 - - 64,800.00 64,800.00 - 06/01/2032 405,000.00 4.000% 64,800.00 469,800.00 534,600.00 12/01/2032 - - 56,700.00 56,700.00 - 06/01/2033 425,000.00 4.000% 56,700.00 481,700.00 538,400.00 12/01/2033 - - 48,200.00 48,200.00 - 06/01/2034 450,000.00 4.000% 48,200.00 498,200.00 546,400.00 12/01/2034 - - 39,200.00 39,200.00 - 06/01/2035 470,000.00 4.000% 39,200.00 509,200.00 548,400.00 12/01/2035 - - 29,800.00 29,800.00 - 06/01/2036 495,000.00 4.000% 29,800.00 524,800.00 554,600.00 12/01/2036 - - 19,900.00 19,900.00 - 06/01/2037 495,000.00 4.000% 19,900.00 514,900.00 534,800.00 12/01/2037 - - 10,000.00 10,000.00 - 06/01/2038 500,000.00 4.000% 10,000.00 510,000.00 520,000.00 Total $6,000,000.00 - $2,083,400.00 $8,083,400.00 - Yield Statistics Bond Year Dollars $52,085.00 Average Life 8.681 Years Average Coupon 4.0000000% Net Interest Cost (NIC) 3.4392839% True Interest Cost (TIC) 3.3288569% Bond Yield for Arbitrage Purposes 2.8618351% All Inclusive Cost (AIC) 3.4943285% IRS Form 8038 Net Interest Cost 3.0372600% Weighted Average Maturity 8.694 Years 23A Waterloo 6m GO FINAL I SINGLE PURPOSE 1 4/18/2023 1 12:35 PM Speer Financial, Inc. Registered Municipal Advisor Page 24 of 24