HomeMy WebLinkAboutExhibits A and B SUBTHIS DOCUMENT IS A SUBSTITUTION. BACKUP
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EXHIBIT "A"
FORM OF SERIES 2018 BOND
THIS BOND IS SUBJECT TO TRANSFER RESTRICTIONS. THE INITIAL PURCHASER
HEREOF AND ANY SUBSEQUENT TRANSFEREE, BY PURCHASING THIS BOND, AGREES
FOR THE BENEFIT OF THE CITY OF MIAMI, FLORIDA, THAT THIS BOND MAY BE
TRANSFERRED, RESOLD OR ASSIGNED ONLY TO ANOTHER QUALIFIED
INSTITUTIONAL BUYER. NOTWITHSTANDING ANYTHING IN THE RESOLUTION OR
THIS BOND TO THE CONTRARY, NO TRANSFER, RESALE OR ASSIGNMENT OF THIS
BOND SHALL BE EFFECTIVE UNLESS THE TRANSFER, RESALE OR ASSIGNMENT OF
THIS BOND IS TO ANY PURCHASER, TRANSFEREE, ASSIGNEE OR PARTICIPANT THAT
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A PROMULGATED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. ANY TRANSFER, RESALE OR
ASSIGNMENT OR OTHER DISPOSITION OF THIS BOND, OR ANY PARTICIPATION
HEREIN, SHALL BE IN EACH CASE ONLY IN A MANNER THAT DOES NOT VIOLATE THE
SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER. THIS BOND SHALL BE ISSUED AND SOLD, AND MAY
ONLY BE TRANSFERRED, IN DENOMINATIONS OF $100,000 OR ANY INTEGRAL
MULTIPLE OF $5,000IN EXCESS OF $100,000.
No.
UNITED STATES OF AMERICA
STATE OF FLORIDA
CITY OF MIAMI, FLORIDA
[TAXABLE] SPECIAL OBLIGATION [REVENUE] [REFUNDING] BO NDS,
SERIES 2018[A][B][C]
(STREET AND SIDEWALK IMPROVEMENT PROGRAM)
Interest Rate
FILE NO 4210
Maturity Date Original Issue Date
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$
CUSIP No.
Registered Owner:
Principal Amount:
Dollars
City of Miami, Florida (the "City"), for value received, promises to pay, but solely from
the sources and in the manner hereinafter provided, to the Registered Owner named above, or
registered assigns, on the Maturity Date set forth above (or earlier as hereinafter referred to)
upon presentation and surrender hereof, at the principal corporate trust office of
as Bond Registrar and Paying Agent, in the city of , Florida, or its
successors (the "Bond Registrar" and "Paying Agent") the Principal Amount set forth above in
any coin or currency of the United States of America which on the date of payment thereof is
legal tender for the payment of public and private debts, and to pay in like coin or currency
interest on said Principal Amount on each January 1 and July 1, commencing (each an
"Interest Payment Date"), solely from such sources provided in the Resolution described herein,
from the Interest Payment Date next preceding the date on which this Bond is authenticated
unless it is (i) authenticated on an Interest Payment Date, in which event from such date, or (ii)
authenticated before the first Interest Payment Date, in which event from its Original Issue Date,
at the Interest Rate set forth above until the Principal Amount hereof is paid. The interest so
payable and punctually paid or duly provided for on any Interest Payment Date, as provided in
the Resolution hereinafter referred to, will be paid by check mailed to the person in whose name
this Bond (or one or more Predecessor Bonds, as defined in the Resolution) is registered at the
close of business on the fifteenth (15th) day of the month next preceding such Interest Payment
Date; provided, however, that any registered owner of Bonds in an aggregate principal amount
of at least $1,000,000 shall be entitled to have interest paid by wire transfer pursuant to the
provisions of the Resolution.
This Bond is one of a duly authorized series of special obligation bonds of the City,
designated "[Taxable] Special Obligation [Revenue] [Refunding] Bonds, Series 2018[A][B][C]
(the "Bonds"), issued in the aggregate principal amount of $ under Resolution No. 07-
0586 adopted by the City on October 11, 2007, as supplemented by Resolution No. 18-_
adopted by the City on , 2018 (collectively, the "Resolution"), as the same may
be supplemented and amended from time to time. The Bonds are being issued to provide funds to
refund certain outstanding [City of Miami, Florida Special Obligation Bonds, Series 2007 (Street
and Sidewalk Improvement Program)] [City of Miami, Florida Special Obligation Bonds, Series
2009 (Street and Sidewalk Improvement Program)], [finance the cost of acquisition, construction
and improvement to certain streetscapes, roadways, drainage and appurtenances thereto] and pay
costs of issuance of the Bonds. Capitalized terms not otherwise defined herein shall have the
meaning ascribed to such terms in the Resolution.
The Bonds are limited obligations of the City payable solely from the Designated
Revenues (hereinafter referred to). Neither the faith and credit of the State of Florida nor the faith
and credit of any agency or political subdivision thereof or of the City are pledged to the
payment of the principal of or the interest or redemption premium, if any, on this Bond. The
issuance of this Bond shall not directly or indirectly or contingently obligate the State of Florida
or any agency or political subdivision thereof or the City to levy any taxes whatever therefor or
to make any appropriation for their payment except from the funds pledged therefor.
ADDITIONAL PROVISIONS OF THIS BOND ARE SET FORTH ON THE REVERSE
HEREOF AND SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH SET
FORTH HERE.
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IN WITNESS WHEREOF, the City of Miami, Florida has caused this Bond to be executed
with the [manual] [facsimile] signature of the City Manager and attested by its City Clerk and [a
facsimile of] its official seal to be [impressed] [imprinted] hereon and this Bond to be dated this
day of 2018.
[SEAL] CITY OF MIAMI, FLORIDA, a municipal
corporation
Approved as to Insurance
Requirements:
By:
Risk Management Director
[Manual or Facsimile Signature]
City Manager
Approved as to Form
and Correctness ATTEST:
City Attorney
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By:
[Manual or Facsimile Signature]
City Clerk
CERTIFICATE OF AUTHENTICATION
This Bond is a bond issued under the provisions of the within -mentioned Resolution.
- - Bond Registrar
Date of authentication:
B y:
Authorized Signatory
[Form of Reverse of Bonds]
To secure the Bonds, the City has irrevocably pledged the Designated Revenues under the
Resolution. The Designated Revenues consist of (a)(i) the City's portion of the Local Option Gas
Taxes, (ii) eighty percent (80%) of the City's portion of the Transportation Surtax, (iii) twenty
percent (20%) of the City's Parking Surcharge, and (iv) all investment income realized by reason
of the investment of moneys on deposit or credited to the Debt Service Fund whether such
investment income is deposited or credited to the Designated Revenues Fund or remains in the
Account in the Debt Service Fund where earned (any fees, commissions or charges established
pursuant to the laws of Florida or ordinances or administrative orders of the City or County
which replace any of the items mentioned in clause (i), (ii) or (iii) shall be included in the
definition of Designated Revenues), and (b) all moneys and investments, including investment
earnings thereon, held for the credit of the funds, accounts and subaccounts established under
the Resolution or any Series Resolution, other than the Rebate Fund and any accounts created
thereunder. The City has full power and authority to pledge the Designated Revenues to the
payment of the principal of, interest and redemption premium, if any, on the Bonds.
Reference is made to the Resolution for a more complete statement of the provisions
thereof and of the rights and duties of the City and the registered owners. Copies of the
Resolution are on file and may be inspected at the office of the City Clerk. By the purchase and
acceptance of this Bond, the Registered Owner hereof signifies assent to all of the provisions of
the Resolution.
This Bond is issued and the Resolution was enacted under and pursuant to the
Constitution and laws of the State of Florida.
The Bonds are issuable as fully registered Bonds in the denomination of $100,000 or any
integral multiple of $5,000 in excess of $100,000. At the principal corporate trust office of the
Bond Registrar, in the manner and subject to the limitations and conditions provided in the
Resolution, Bonds may be exchanged for an equal aggregate principal amount of Bonds of the
same series ancl maturity, of any authorized denomination or denominations and bearing
interest at the same rate.
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The transfer of this Bond is registrable by the Registered Owner hereof in person or by
his/her attorney or legal representative at the principal corporate trust office of the Bond
Registrar, but only in the manner and subject to the limitations and conditions provided in the
Resolution and upon surrender and cancellation of this Bond. Upon any such registration of
transfer, the City shall execute and the Bond Registrar shall authenticate and deliver in exchange
for this Bond a new Bond or Bonds, registered in the name of the transferee (which must be a
Qualified Institutional Buyer), of any authorized denomination or denominations in an aggregate
principal amount equal to the principal amount of this Bond, of the same series and maturity and
bearing interest at the same rate. Neither the City nor the Bond Registrar shall be required to
make any exchange or registration of transfer of any Bond during the fifteen (15) days
immediately preceding the date of the City's giving notice of redemption or purchase or after
such Bond has been selected for redemption or purchase.
[INSERT REDEMPTION PROVISIONS]
At least thirty (30) days, but not more than sixty days (60) before the redemption date of
any Bonds, whether such redemption is in whole or in part, the City shall cause a notice of any
such redemption signed by the City to be mailed, first class, postage prepaid, to all registered
owners of Bonds to be redeemed in whole or in part, but any defect in such notice or the failure
so to mail any such notice to the registered owners of any Bond shall not affect the validity of
the proceedings for the redemption of any other Bonds. On the date fixed for redemption, notice
having been mailed in the manner provided in the Resolution and sufficient moneys having
been deposited with the Paying Agent or other Depositary, the Bonds or portions thereof called
for redemption shall be due and payable at the redemption price provided therefor, plus
accrued interest to such date. If a portion of this Bond shall be called for redemption a new Bond
or Bonds in principal amount equal to the unredeemed portion hereof will be issued to the
Registered Owner upon the surrender hereof.
The owner of this Bond shall have no right to enforce the provisions of the Resolution or
to institute action to enforce the covenants therein, or to take any action with respect to any event
of default under the Resolution, or to institute, appear in or defend any suit or other proceeding
with respect thereto, except as provided in the Resolution.
The Resolution permits the issuance of additional or refunding bonds secured on a parity
with the Bonds upon compliance with the conditions contained therein. Modifications or
alterations of the Resolution, or any resolution supplemental thereto, may be made only to the
extent and in the circumstances permitted by the Resolution.
This Bond is issued with the intent that the laws of the State of Florida shall govern its
construction.
All acts, conditions and things required to happen, exist and be performed precedent to
and in the issuance of this Bond have happened, exist and have been performed as so required.
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This Bond shall not be valid or become obligatory for any purpose or be entitled to any
benefit or security under the Resolution until it shall have been authenticated by the execution by
the Bond Registrar of the certificate of authentication endorsed hereon.
[Form of Assignment]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
[Please Print or Typewrite Name, Tax Identification Number and Address of Transferee]
a Qualified Institutional Buyer, the within Bond, and all rights thereunder, and hereby irrevocably
constitutes and appoints
attorney to register the transfer of the within Bond on the books kept for registration thereof, with
full power of substitution in the premises.
Dated:
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NOTICE: The signature to this
assignment must correspond with
the name as it appears upon the face
of the within bond in every
particular, without alteration or any
change whatever.
EXHIBIT `B"
DRAFT OF PRELIMINARY LIMITED OFFERING MEMORANDUM
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a registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York
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H oO a
PRELIMINARY LIMITED OFFERING MEMORANDUM DATED , 2018
NEW ISSUE — BOOK ENTRY ONLY
Ratings: S&P: "" (stable outlook)
Moody's: "" (stable outlook)
(See "Ratings" herein)
In the opinion of bond counsel, assuming compliance by the City with certain covenants, under existing
statutes, regulations, and judicial decisions, the interest on the Series 2018A Bonds will be excluded from gross
income for federal income tax purposes of the holders thereof and will not be an item of tax preference for purposes
of the federal alternative minimum tax. However, interest on the Series 2018A Bonds shall be taken into account in
determining adjusted current earnings for purposes of computing the alternative minimum tax on corporations for
taxable years that began prior to January 1, 2018. The alternative minimum tax on corporations was repealed for
taxable years beginning on and after January 1, 2018. See "TAX MATTERS" herein for a description of other tax
consequences to holders of the Series 2018A Bonds.
CITY OF MIAMI, FLORIDA
SPECIAL OBLIGATION
REFUNDING BONDS,
SERIES 2018A
(Street and Sidewalk
Improvement Program)
$ *
CITY OF MIAMI, FLORIDA
TAXABLE SPECIAL
OBLIGATION REFUNDING
BONDS, SERIES 2018B
(Street and Sidewalk
Improvement Program)
$ *
CITY OF MIAMI, FLORIDA
TAXABLE SPECIAL
OBLIGATION REVENUE
BONDS, SERIES 2018C
(Street and Sidewalk
Improvement Program)
Dated: Date of Delivery Due: January 1, as shown on inside cover
The $ * City of Miami, Florida Special Obligation Refunding Bonds, Series 2018A (Street and
Sidewalk Improvement Program) (the "Series 2018A Bonds"), $ * City of Miami, Florida Taxable
Special Obligation Refunding Bonds, Series 2018B (Street and Sidewalk Improvement Program) (the "Series 2018B
Bonds") and $ * City of Miami, Florida Taxable Special Obligation Revenue Bonds, Series 2018C
(Street and Sidewalk Improvement Program) (the "Series 2018C Bonds" and, together with the Series 2018A Bonds
and the Series 2018B Bonds, the "Series 2018 Bonds") are being issued by the City of Miami, Florida (the "City")
pursuant to the Constitution and laws of the State of Florida, including Chapter 166, Part II, Florida Statutes, the
Charter of the City, and other applicable provisions of law (the "Act") and pursuant to Resolution No. R-07-0586
adopted by the City Commission on October 11, 2007 (the "Original Resolution") and Resolution No. R-18-
adopted by the City Commission on June , 2018 (the "Series 2018 Bonds Resolution," and together
with the Original Resolution, the "Resolution").
The Series 2018A Bonds are being issued for the purpose of providing funds, together with other available
moneys, to (i) refund all or a portion of the City's outstanding Special Obligation Bonds, Series 2007 (Street and
Sidewalk Improvement Program) and (ii) pay the costs of issuance of the Series 2018A Bonds.
The Series 2018B Bonds are being issued for the purpose of providing funds, together with other available
moneys, to (i) refund all or a portion of the City's outstanding Special Obligation Bonds, Series 2009 (Street and
Sidewalk Improvement Program) and (ii) pay the costs of issuance of the Series 2018B Bonds.
The Series 2018C Bonds are being issued for the purpose of providing funds, together with other available
moneys, to (i) finance the cost of acquisition, construction, and improvements to certain roadways, drainage,
streetscapes and related appurtenances and (ii) pay the costs of issuance of the Series 2018C Bonds.
This cover page contains certain information for quick reference only. It is not, and is not intended to be, a
summary of the issue. Investors must read the entire Limited Offering Memorandum to obtain information needed
for the making of an informed investment decision.
The Series 2018 Bonds are being issued by the City as fully registered bonds, which initially will be
010-8616-7788/4/AM ERICAS
("DTC"). Individual purchases will be made in book -entry form only through Participants (defined herein) in
denominations of $100,000 and integral multiples of $5,000 in excess of $100,000. Purchasers of the Series 2018
Bonds (the `Beneficial Owners") will not receive physical delivery of the Series 2018 Bonds. Transfers of
ownership interests in the Series 2018 Bonds will be effected by the DTC book -entry system as described herein.
As long as Cede & Co. is the registered owner as nominee of DTC, principal and interest payments will be made
directly to such registered owner which will in turn remit such payments to the Participants (as defined herein) for
subsequent disbursement to the Beneficial Owners. Interest on the Series 2018 Bonds is payable semi-annually on
each January 1 and July 1, commencing January 1, 2019. Principal of, premium, if any, and interest on the Series
2018 Bonds will be payable by U.S. Bank National Association, Jacksonville, Florida, as Paying Agent and Bond
Registrar.
Payment of the principal of, premium, if any, and interest, on the Series 2018 Bonds will be secured by a
lien upon and a pledge of (i) the proceeds of the Local Option Gas Taxes (as defined herein), (ii) eighty percent
(80%) of the City's portion of the Transportation Surtax (as defined herein), (iii) twenty percent (20%) of the City's
Parking Surcharge (as defined herein), (iv) such additional revenues as may be designated by a Series Resolution as
Designated Revenues under the Resolution, and (v) all investment income realized by reason of the investment of
moneys on deposit or credited to the Debt Service Fund created by the Resolution, whether such investment income
is deposited or credited to the Designated Revenues Fund or remains in the Account in the Debt Service Fund where
earned, all as defined herein (collectively, the "Designated Revenues") and as further described under "SECURITY
AND SOURCES OF PAYMENT FOR THE SERIES 2018 BONDS". The Series 2018 Bonds do not constitute a
general indebtedness of the City within the meaning of any constitutional or statutory provision or limitation and the
City is not obligated to levy any ad valorem taxes or to make an appropriation for their payment except from the
Designated Revenues to the extent provided in the Resolution, as described herein. Neither the full faith and credit
nor the taxing power of the State of Florida or any political subdivision or agency thereof is pledged to the payment
of the principal of, redemption premium, if any, and interest of the Series 2018 Bonds.
Certain maturities of the Series 2018 Bonds are subject to optional redemption prior to their respective
maturities and mandatory redemption, as described herein under "DESCRIPTION OF THE SERIES 2018 BONDS
— Optional Redemption, and — Mandatory Redemption."
See the inside cover page for maturities, principal amounts, interest rates, yields, prices and CUSIP
numbers.
THE SERIES 2018 BONDS INVOLVE A DEGREE OF RISK AND ARE NOT SUITABLE FOR ALL
INVESTORS. THE CITY AND THE UNDERWRITERS ARE OFFERING THE SERIES 2018 BONDS ONLY
TO QUALIFIED INSTITUTIONAL BUYERS WITHIN THE MEANING OF SECURITIES AND EXCHANGE
COMMISSION RULE 144A. SEE "DESCRIPTION OF THE SERIES 2018 BONDS — TRANSFER
RESTRICTIONS" HEREIN.
The Series 2018 Bonds are offered when, as, and if issued and received by the Underwriters, subject to the
opinion on certain legal matters relating to their issuance by Bryant Miller Olive P.A., Miami, Florida, Bond
Counsel. Certain legal matters will be passed upon for the City by Victoria Mendez, Esq., City Attorney, and by
Squire Patton Boggs (US) LLP, Miami, Florida, Disclosure Counsel to the City. Certain legal matters will be
passed upon for the Underwriters by Bracewell LLP, Washington, D.C. PFM Financial Advisors LLC, Coral
Gables, Florida is serving as Financial Advisor to the City. It is expected that the Series 2018 Bonds in definitive
form will be available for delivery to the Underwriters in New York, New York at the facilities of DTC on or about
, 2018.
Stifel
Estrada Hinojosa PNC Capital Markets LLC
Dated: , 2018
010-8616-7788/4/AM ERICAS
MATURITIES, PRINCIPAL AMOUNTS, INTEREST RATES,
YIELDS, PRICES AND CUSIP NUMBERS
CITY OF MIAMI, FLORIDA
SPECIAL OBLIGATION REFUNDING BONDS, SERIES 2018A
(STREET AND SIDEWALK IMPROVEMENT PROGRAM)
Maturity Principal Initial
(January 1) Amount Interest Rate Yield Price CUSIP Number'
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
* Preliminary, subject to change
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 Global Market Intelligence. Copyright(c) 2018
CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data
is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP®
numbers are provided for convenience of reference only. None of the City, the Underwriters or their agents or
counsel assume responsibility for the accuracy of such numbers.
010-8616-7788/4/AM ERICAS
CITY OF MIAMI, FLORIDA
TAXABLE SPECIAL OBLIGATION REFUNDING BONDS, SERIES 2018B
(STREET AND SIDEWALK IMPROVEMENT PROGRAM)
Maturity Principal Initial
(January 1) Amount Interest Rate Yield Price CUSIP Number'
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
* Preliminary, subject to change
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 Global Market Intelligence. Copyright(c) 2018
CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data
is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP®
numbers are provided for convenience of reference only. None of the City, the Underwriters or their agents or
counsel assume responsibility for the accuracy of such numbers.
010-8616-7788/4/AM ERICAS
CITY OF MIAMI, FLORIDA
TAXABLE SPECIAL OBLIGATION REVENUE BONDS, SERIES 2018C
(STREET AND SIDEWALK IMPROVEMENT PROGRAM)
Maturity Principal Initial
(January 1) Amount Interest Rate Yield Price CUSIP Number'
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
* Preliminary, subject to change
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 Global Market Intelligence. Copyright(c) 2018
CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data
is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP®
numbers are provided for convenience of reference only. None of the City, the Underwriters or their agents or
counsel assume responsibility for the accuracy of such numbers.
010-8616-7788/4/AM ERICAS
THE CITY OF MIAMI, FLORIDA
3500 Pan American Drive
Miami, Florida 33133
MAYOR
Francis X. Suarez
CITY COMMISSIONERS
Keon Hardemon, Chair
Ken Russell, Vice Chair
Joe Carollo
Wifredo (Willy) Gort
Manolo Reyes
CITY MANAGER
Emilio T. Gonzalez
CITY CLERK
Todd B Hannon
CITY ATTORNEY
Victoria Mendez
CHIEF FINANCIAL OFFICER
Sandra Bridgeman
FINANCE DIRECTOR
Erica Paschal
BOND COUNSEL
Bryant Miller Olive P.A.
Miami, Florida
DISCLOSURE COUNSEL
Squire Patton Boggs (US) LLP
Miami, Florida
FINANCIAL ADVISOR
PFM Financial Advisors LLC
Coral Gables, Florida
010-8616-7788/4/AM ERICAS
NO DEALER, BROKER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED BY
THE CITY OR THE UNDERWRITERS TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THE SERIES 2018 BONDS, OTHER THAN AS
CONTAINED IN THIS LIMITED OFFERING MEMORANDUM, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE CITY. THIS LIMITED OFFERING MEMORANDUM DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY, NOR WILL
THERE BE ANY SALE OF THE SERIES 2018 BONDS BY ANY PERSON IN ANY JURISDICTION
IN WHICH IT IS UNLAWFUL FOR SUCH PERSON TO MAKE SUCH OFFER, SOLICITATION OR
SALE.
CAUTIONARY STATEMENTS REGARDING FORWARD -LOOKING STATEMENTS IN
THIS LIMITED OFFERING MEMORANDUM:
CERTAIN STATEMENTS INCLUDED OR INCORPORATED BY REFERENCE IN THIS
LIMITED OFFERING MEMORANDUM CONSTITUTE "FORWARD -LOOKING STATEMENTS."
SUCH STATEMENTS GENERALLY ARE IDENTIFIABLE BY THE TERMINOLOGY USED, SUCH
AS "PLAN," "EXPECT," "ESTIMATE," "BUDGET" OR OTHER SIMILAR WORDS. SUCH
FORWARD -LOOKING STATEMENTS INCLUDE BUT ARE NOT LIMITED TO CERTAIN
STATEMENTS CONTAINED IN THE INFORMATION UNDER THE CAPTIONS "ESTIMATED
SOURCES AND USES OF FUNDS."
THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED
IN SUCH FORWARD -LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS,
UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL RESULTS,
PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM
ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY
SUCH FORWARD -LOOKING STATEMENTS. THE CITY DOES NOT PLAN TO ISSUE ANY
UPDATES OR REVISIONS TO THOSE FORWARD -LOOKING STATEMENTS IF OR WHEN ITS
EXPECTATIONS CHANGE OR EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH
SUCH STATEMENTS ARE BASED DO NOT OCCUR.
THE INFORMATION SET FORTH HEREIN HAS BEEN OBTAINED FROM THE CITY,
DTC AND OTHER SOURCES THAT ARE BELIEVED TO BE RELIABLE. THE UNDERWRITERS
LISTED ON THE COVER PAGE HEREOF HAVE REVIEWED THE INFORMATION IN THIS
LIMITED OFFERING MEMORANDUM IN ACCORDANCE WITH AND AS PART OF THEIR
RESPONSIBILITIES TO INVESTORS UNDER THE FEDERAL SECURITIES LAWS AS APPLIED
TO THE FACTS AND CIRCUMSTANCES OF THIS TRANSACTION, BUT THE UNDERWRITERS
DO NOT GUARANTEE THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION. THE
INFORMATION AND EXPRESSIONS OF OPINION STATED HEREIN ARE SUBJECT TO
CHANGE, AND NEITHER THE DELIVERY OF THIS LIMITED OFFERING MEMORANDUM NOR
ANY SALE MADE HEREUNDER WILL CREATE, UNDER ANY CIRCUMSTANCES, ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE MATTERS DESCRIBED HEREIN
SINCE THE DATE HEREOF.
IN CONNECTION WITH THIS OFFERING OF THE SERIES 2018 BONDS, THE
UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR
MAINTAIN THE MARKET PRICE OF SUCH SERIES 2018 BONDS AT LEVELS ABOVE THAT
WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF
COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
010-8616-7788/4/AM ERICAS
ALL SUMMARIES HEREIN OF DOCUMENTS AND AGREEMENTS ARE QUALIFIED IN
THEIR ENTIRETY BY REFERENCE TO SUCH DOCUMENTS AND AGREEMENTS, AND ALL
SUMMARIES HEREIN OF THE SERIES 2018 BONDS ARE QUALIFIED IN THEIR ENTIRETY BY
REFERENCE TO THE FORM THEREOF INCLUDED IN THE AFORESAID DOCUMENTS AND
AGREEMENTS.
REFERENCES TO WEBSITE ADDRESSES PRESENTED IN THIS LIMITED OFFERING
MEMORANDUM ARE FOR INFORMATIONAL PURPOSES ONLY AND MAY BE IN THE FORM
OF A HYPERLINK SOLELY FOR THE READER'S CONVENIENCE. UNLESS SPECIFIED
OTHERWISE, SUCH WEB SITES AND THE INFORMATION OR LINKS CONTAINED THEREIN
ARE NOT INCORPORATED INTO, AND ARE NOT PART OF, THIS LIMITED OFFERING
MEMORANDUM.
THE UNDERWRITERS HAVE PROVIDED THE FOLLOWING SENTENCE FOR
INCLUSION IN THIS LIMITED OFFERING MEMORANDUM. The Underwriters have reviewed the
information in this Limited Offering Memorandum in accordance with, and as part of their responsibility
to investors under the federal securities law as applied to the facts and circumstances of this transaction,
but the Underwriters do not guarantee the accuracy or completeness of such information.
NO REGISTRATION STATEMENT RELATING TO THE SERIES 2018 BONDS HAS BEEN
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "SEC") OR WITH ANY
STATE SECURITIES COMMISSION. IN MAKING ANY INVESTMENT DECISION, INVESTORS
MUST RELY ON THEIR OWN EXAMINATIONS OF THE CITY AND THE TERMS OF THE
OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. THE SERIES 2018 BONDS
HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC OR ANY STATE SECURITIES
COMMISSION OR REGULATORY AUTHORITY. THE FOREGOING AUTHORITIES HAVE NOT
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS LIMITED OFFERING
MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY MAY BE A CRIMINAL
OFFENSE.
WHILE THE SERIES 2018 BONDS ARE NOT SUBJECT TO REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), THE CITY HAS
DETERMINED AND THE UNDERWRITERS HAVE AGREED TO RESTRICT THE SALE AND
RESALE OF THE SERIES 2018 BONDS TO "QUALIFIED INSTITUTIONAL BUYERS," AS
DEFINED IN RULE 144A PROMULGATED UNDER THE SECURITIES ACT ("QUALIFIED
INSTITUTIONAL BUYERS") AND WILL OFFER THE SERIES 2018 BONDS ONLY TO SUCH
QUALIFIED INSTITUTIONAL BUYERS. SEE "DESCRIPTION OF THE SERIES 2018 BONDS -
TRANSFER RESTRICTIONS" AND "APPENDIX F - FORM OF INVESTOR LETTER."
THIS LIMITED OFFERING MEMORANDUM WILL NOT CONSTITUTE A CONTRACT
BETWEEN THE CITY OR THE UNDERWRITERS AND ANY ONE OR MORE HOLDERS OF THE
SERIES 2018 BONDS.
THIS PRELIMINARY LIMITED OFFERING MEMORANDUM IS IN A FORM DEEMED
FINAL BY THE CITY FOR PURPOSES OF RULE 15c2-12 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT"), EXCEPT
FOR CERTAIN FINANCIAL INFORMATION PERMITTED TO BE OMITTED PURSUANT TO
RULE 15c2-12(b)(1).
010-8616-7788/4/AM ERICAS
TABLE CONTENTS
Page
INTRODUCTION 1
PURPOSE OF THE SERIES 2018 BONDS 3
PLAN OF FINANCE 3
Plan of Refunding 3
Plan for Use of Remaining Unspent Proceeds of the Series 2009 Bonds 4
Series 2018 Project 5
ESTIMATED SOURCES AND USES OF FUNDS 6
DEBT SERVICE SCHEDULE 7
DESCRIPTION OF THE SERIES 2018 BONDS 7
General 7
Optional Redemption 8
Mandatory Redemption 8
Notice and Effect of Redemption 10
Book -Entry Only System 11
Registration, Transfer and Exchange 13
Transfer Restrictions 14
Replacement of Bonds Mutilated, Destroyed, Stolen or Lost 15
SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2018 BONDS 15
General 15
Limited Obligations 15
Establishment of Funds and Accounts 15
Application of Pledged Funds 16
No Reserve Fund 19
Hedge Agreements 19
Issuance of Additional Bonds 19
Refunding Bonds 19
Economic Environment Impact on Designated Revenues 20
Covenant as to Designated Revenues 20
LOCAL OPTION GAS TAXES 21
General 21
Collection and Distribution 21
First Levy 22
Second Levy 23
Eligibility 23
Historical Gasoline Sales in the County 24
TRANSPORTATION SURTAX 25
General 25
Levy of Transit System Sales Surtax 25
Collection, Distribution and Uses 26
Transit System Sales Surtax Audit 27
i
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TABLE CONTENTS
(continued)
Page
PARKING SURCHARGE 28
General 28
Levy of Parking Surcharge and Uses 28
Collection 29
THE CITY OF MIAMI 30
Background 30
City Government 30
Adoption of Investment Policy and Debt Management Policy 31
Capital Improvement Plan 32
Fiscal and Accounting Procedures 33
Financial Information Relating to the City 33
Indebtedness of the City 33
Pension Fund 33
Accrued Compensated Absences 35
Union Labor Agreements 35
Other Postemployment Benefits ("OPEB") 35
Implementation of Recent GASB Statements Regarding Pensions 37
Financial Urgency 38
Impact of the Zika Virus 39
Impact of Hurricane Irma 39
Legislative Matters Affecting the City 40
Proposed Constitutional Amendments Affecting the City 40
LEGISLATIVE AND CONSTITUTIONAL INITIATIVES CONCERNING AD
VALOREM TAXES 41
FEDERAL COURT ORDER AND INJUNCTION, CEASE AND DESIST ORDER OF
THE SECURITIES AND EXCHANGE COMMISSION AND OTHER DISCLOSURE
RELATED SECURITIES AND EXCHANGE COMMISSION INVESTIGATIONS 45
Overview 45
The 2016 Final Judgment and Order 45
The 2003 Cease and Desist Order 47
Disclosure Related Investigation 47
City's Current Capital and Operating Budget and Financial Reporting Procedures 48
LEGAL MATTERS 48
LITIGATION [TO BE UPDATED] 48
DOJ v. City of Miami 49
Fraternal Order of Police, Walter E. Headley, Jr., Miami Lodge No. 20 v. City of Miami 49
International Association of Firefighters, Local 587 v. City of Miami 50
Jorge Castro v. City of Miami, et. al. 50
Catholic Archdiocese of Miami v City of Miami 50
City of Miami Incinerator "Old Smokey" Claims 51
Civil Rights Actions 51
Flagstone v. City of Miami 51
Internal Revenue Service Examinations 52
Petroleum Products Corporation 52
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TABLE CONTENTS
(continued)
Page
DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS 53
TAX MATTERS [TO BE EXPANDED TO ADDRESS TAXABLE BONDS] 53
General 53
Information Reporting and Backup Withholding 54
Other Tax Matters 55
[Tax Treatment of Original Issue Discount 55
[Tax Treatment of Bond Premium 55
RATINGS 56
VERIFICATION OF MATHEMATICAL COMPUTATIONS 56
FINANCIAL ADVISOR 56
FINANCIAL STATEMENTS 56
UNDERWRITING 57
CONTINGENT FEES 57
ENFORCEABILITY OF REMEDIES 57
CONTINUING DISCLOSURE 57
ACCURACY AND COMPLETENESS OF LIMITED OFFERING MEMORANDUM 58
FORWARD -LOOKING STATEMENTS 59
MISCELLANEOUS 59
AUTHORIZATION OF LIMITED OFFERING MEMORANDUM 60
APPENDICES
APPENDIX A:
APPENDIX B:
APPENDIX C:
APPENDIX D:
APPENDIX E:
APPENDIX F:
GENERAL INFORMATION REGARDING THE CITY OF MIAMI
COPY OF THE ORIGINAL RESOLUTION AND FORM OF THE SERIES 2018
BONDS RESOLUTION
BASIC FINANCIAL STATEMENTS OF THE CITY OF MIAMI FOR FISCAL
YEAR ENDED SEPTEMBER 30, 2017 (Excerpt of the City of Miami Comprehensive
Annual Financial Report)
FORM OF BOND COUNSEL OPINION
FORM OF DISCLOSURE DISSEMINATION AGENT AGREEMENT
FORM OF INVESTOR LETTER
010-8616-7788/4/AM ER I CAS
5
CITY OF MIAMI, FLORIDA
SPECIAL OBLIGATION
REFUNDING BONDS,
SERIES 2018A
(Street and Sidewalk
Improvement Program)
LIMITED OFFERING MEMORANDUM
relating to
5 *
CITY OF MIAMI, FLORIDA
TAXABLE SPECIAL
OBLIGATION REFUNDING
BONDS, SERIES 2018B
(Street and Sidewalk
Improvement Program)
INTRODUCTION
CITY OF MIAMI, FLORIDA
TAXABLE SPECIAL
OBLIGATION REVENUE
BONDS, SERIES 2018C
(Street and Sidewalk
Improvement Program)
The purpose of this Limited Offering Memorandum, including the cover page and appendices, is
to set forth information concerning the City of Miami, Florida (the "City"), the $ * City of
Miami, Florida Special Obligation Refunding Bonds, Series 2018A (Street and Sidewalk Improvement
Program) (the "Series 2018A Bonds"), the $ * City of Miami, Florida Taxable Special
Obligation Refunding Bonds, Series 2018B (Street and Sidewalk Improvement Program) (the "Series
2018B Bonds") and the $ * City of Miami, Florida Taxable Special Obligation Revenue Bonds,
Series 2018C (Street and Sidewalk Improvement Program) (the "Series 2018C Bonds" and, together with
the Series 2018A Bonds and the Series 2018B Bonds, the "Series 2018 Bonds"), in connection with the
sale of the Series 2018 Bonds.
The Series 2018 Bonds are being issued pursuant to the Constitution and laws of the State of
Florida, including Chapter 166, Part II, Florida Statutes, the Charter of the City, and other applicable
provisions of law (the "Act") and pursuant to Resolution No. R-07-0586 adopted by the City Commission
on October 11, 2007 (the "Original Resolution") and Resolution No. R-18- adopted by the
City Commission on June , 2018 (the "Series 2018 Bonds Resolution," and together with the Original
Resolution, the "Resolution"). The Series 2018A Bonds are being issued for the purpose of providing
funds, together with other available moneys, to (i) refund all or a portion of the City's outstanding Special
Obligation Bonds, Series 2007 (Street and Sidewalk Improvement Program) (the "Series 2007 Bonds,"
and the portion of the Series 2007 Bonds to be refunded being hereinafter referred to as the "Refunded
Series 2007 Bonds") and (ii) pay the costs of issuance of the Series 2018A Bonds. The Series 2018B
Bonds are being issued for the purpose of providing funds, together with other available moneys, to (i)
refund all or a portion of the City's outstanding Special Obligation Bonds, Series 2009 (Street and
Sidewalk Improvement Program) (the "Series 2009 Bonds," and the portion of the Series 2009 Bonds to
be refunded being hereinafter referred to as the "Refunded Series 2009 Bonds," the Refunded Series 2007
Bonds and the Refunded Series 2009 Bonds are collectively referred to herein as the "Refunded Bonds")
and (ii) pay the costs of issuance of the Series 2018B Bonds. The Series 2018C Bonds are being issued
for the purpose of providing funds, together with other available moneys, to (i) finance the cost of
acquisition, construction, and improvements to certain roadways, drainage, streetscapes and related
appurtenances (the "Series 2018 Project") and (ii) pay the costs of issuance of the Series 2018C Bonds.
See "PURPOSE OF THE SERIES 2018 BONDS" herein.
The Series 2018 Bonds will be on a parity as to source and security for payment with any
unrefunded portions of the Series 2007 Bonds and Series 2009 Bonds, as well as any additional Parity
Obligations (as defined in the Resolution) issued in the future under the Resolution (collectively, the
"Parity Bonds").
* Preliminary, subject to change
010-8616-7788/4/AM ERICAS
Payment of the principal of, premium, if any, and interest, on the Series 2018 Bonds will be
secured by a lien upon and a pledge of (i) the proceeds of the Local Option Gas Taxes, (ii) eighty percent
(80%) of the City's portion of the Transportation Surtax, (iii) twenty percent (20%) of the City's Parking
Surcharge, (iv) such additional revenues as may be designated by a Series Resolution as Designated
Revenues under the Resolution, and (v) all investment income realized by reason of the investment of
moneys on deposit or credited to the Debt Service Fund created by the Resolution, whether such
investment income is deposited or credited to the Designated Revenues Fund or remains in the Account in
the Debt Service Fund where earned, all as defined herein (collectively, the "Designated Revenues"). The
Series 2018 Bonds do not constitute a general indebtedness of the City within the meaning of any
constitutional or statutory provision or limitation and the City is not obligated to levy any ad valorem
taxes or to make an appropriation for their payment except from the Designated Revenues to the extent
provided in the Resolution, as described herein. Neither the full faith and credit nor the taxing power of
the State of Florida (the "State" or "Florida") or any political subdivision or agency thereof is pledged to
the payment of the principal of, redemption premium, if any, and interest of the Series 2018 Bonds. See
"SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2018 BONDS" herein.
While the Series 2018 Bonds are not subject to registration under the Securities Act of 1933, as
amended (the "Securities Act"), the City has determined and the Underwriters have agreed to restrict the
sale and resale of the Series 2018 Bonds to "qualified institutional buyers," as defined in Rule 144A
promulgated under the Securities Act ("Qualified Institutional Buyers") and will offer the Series 2018
Bonds only to such Qualified Institutional Buyers. See "DESCRIPTION OF THE SERIES 2018 BONDS
— Transfer Restrictions" and "APPENDIX F — FORM OF INVESTOR LETTER."
The summaries of and references to all documents, statutes, reports and other instruments referred
to herein do not purport to be complete, comprehensive or definitive, and each such summary and
reference is qualified in its entirety by reference to each such document, statute, report or instrument. All
capitalized terms used in this Limited Offering Memorandum and not otherwise defined herein have the
meanings set forth in the Resolution, unless the context would clearly indicate otherwise. A copy of the
Resolution is attached hereto as "APPENDIX B — COPY OF THE ORIGINAL RESOLUTION AND
FORM OF THE SERIES 2018 BONDS RESOLUTION."
All documents of the City referred to herein may be obtained from the City's, Finance Director,
444 S.W. 2nd Avenue, 6th Floor, Miami, Florida 33130, Telephone (305) 416-1328.
Remainder of this page intentionally left blank]
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010-8616-7788/4/AM ERICAS
PURPOSE OF THE SERIES 2018 BONDS
The Series 2018A Bonds are being issued by the City to provide funds, together with other
available moneys, to (i) refund and redeem the Refunded Series 2007 Bonds and (ii) pay certain costs of
issuance of the Series 2018A Bonds. The Series 2018B Bonds are being issued by the City to provide
funds, together with other available moneys, to (i) refund and redeem the Refunded Series 2009 Bonds,
and (ii) pay the costs of issuance of the Series 2018B Bonds. The Series 2018C Bonds are being issued
for the purpose of providing funds, together with other available moneys, to (i) finance the cost of the
Series 2018 Project and (ii) pay certain costs of issuance of the Series 2018 Bonds.
PLAN OF FINANCE
Plan of Refunding
The Series 2018A Bonds are being issued by the City to refund (in a current refunding) and
redeem all or a portion of the Series 2007 Bonds, which are currently outstanding in the principal amount
of $63,595,000. The Series 2018B Bonds are being issued by the City to advance refund (on a taxable
basis) and redeem all or a portion of the Series 2009 Bonds, which are currently outstanding in the
principal amount of $56,725,000.
To effect the refunding of the Refunded Bonds, the City will enter into an Escrow Deposit
Agreement (the "Escrow Deposit Agreement") with U.S. Bank National Association, as escrow agent (the
"Escrow Agent"). The moneys required to refund the Refunded Bonds will be derived from a portion of
the proceeds of the respective series of Series 2018 Bonds and other legally available funds, made
available upon the issuance of the Series 2018 Bonds and the defeasance of the Refunded Bonds.
[Conditioned on the issuance of the Series 2018 Bonds, the Refunded Series 2007 Bonds will be
redeemed on , 2018* and the Refunded Series 2009 Bonds, maturing on and after January 1,
2020, will be called for redemption on January 1, 2019*, at a redemption price equal to 100% of the
principal amount of the Refunded Bonds to be redeemed, plus accrued interest to the date fixed for
redemption.]
Pursuant to the terms of the Escrow Deposit Agreement, the City will deposit a portion of the
proceeds of the Series 2018 Bonds, together with other available moneys of the City, in separate escrow
deposit trust funds (each an "Escrow Fund" and collectively, the "Escrow Funds") held by the Escrow
Agent and apply a portion thereof to the purchase of direct obligations of the United States of America
(the "Escrow Securities"). The Escrow Securities, together with the interest thereon and a cash balance
on deposit in the respective Escrow Funds are calculated to be sufficient to pay all principal of and
interest on the respective series of Refunded Bonds to their respective redemption dates.
By deposit of the Escrow Securities and uninvested cash with the Escrow Agent pursuant to the
Escrow Deposit Agreement as described above, it is the opinion of Bond Counsel (rendered in reliance
upon the verifications of Robert Thomas CPA, LLC, described under "VERIFICATION OF
MATHEMATICAL COMPUTATIONS" herein) that the Refunded Bonds will be deemed paid in
accordance with, and no longer outstanding under, the provisions of the resolutions pursuant to which
such Refunded Bonds were issued. The maturing principal of and interest on the Escrow Securities and
uninvested cash held by the Escrow Agent will not be available to pay the Series 2018 Bonds.
* Preliminary, subject to change
3
010-8616-7788/4/AM ERICAS
The Refunded Bonds consist of the following principal amounts of the following maturities:
Refunded Series 2007 Bonds
Maturity Date
(January 1) Principal Amount
2019 $ 2,060,000
2020 2,155,000
2021 2,250,000
2022 2,355,000
2027 105,000
2024* 5,075,000
2026* 5,640,000
2028* 6,160,000
2030* 6,955,000
2032* 7,725,000
2037* 23,155,000
Refunded Series 2009 Bonds**
Maturity Date
(January 1) Principal Amount
2020 $ 1,300,000
2021 1,360,000
2022 1,425,000
2023 1,500,000
2024 1,575,000
2029* 9,230,000
2034* 12,070,000
2039* 27,015,000
Plan for Use of Remaining Unspent Proceeds of the Series 2009 Bonds
There are approximately $8,100,000 in unspent proceeds and investment earnings allocable to the
Series 2009 Bonds. The remaining projects financed by the Series 2009 Bonds experienced unanticipated
delays due, in part, to the fact that many of the remaining projects were joint projects undertaken with
other governmental agencies. While these project are still being undertaken, the City has determined to
utilize the unspent Series 2009 Bond proceeds in the refunding of the Series 2009 Bonds and issue the
taxable Series 2018C Bonds to provide ongoing funding for the remaining projects. The status of the
application of bond proceeds to eligible projects was raised in an audit by the County relating to the
receipt by the City of a portion of the Pledged Revenues. Utilizing the remaining Series 2009 Bond
proceeds and investment income thereon in defeasance escrow, should terminate any further recapturing
of funds utilized towards debt service payments. However, failure by the City to expend the Series
2018C Bond proceeds could result in a future recapture of Transit System Sales Surtax funds. See
"TRANSPORTATION SURTAX— Transit System Surtax Audit," herein.
* Term Bond
**Preliminary, subject to change
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010-8616-7788/4/AM ERICAS
Series 2018 Project
As stated above, a portion of the proceeds of the Series 2018C Bonds will be used to finance a
portion of the remaining cost of the acquisition, construction, and improvements to certain roadways,
drainage, streetscapes and related appurtenances within the City that were originally designated to be paid
from proceeds of the Series 2009 Bonds. These projects have experienced significant delays but are still
active projects. The projects include the Downtown Beautification Project (primarily Flagler Street), the
Overtown Greenway, NW 33rd Street Roadway Improvement Project, Dorsey Park Roadway
Improvement Project, Palm Grove Road Improvement Project, SW 17th Street, SW 12th Street and Bird
Avenue, among others. As is the case with the Series 2009 Bonds, the status of the application of bond
proceeds to eligible projects will be subject to scrutiny by the County relating to the receipt by the City of
a portion of the Pledged Revenues. Failure by the City to expend the proceeds of the Series 2018C Bonds
in a timely manner could result in a future recapture of Transit System Sales Surtax funds. See
"TRANSPORTATION SURTAX— Transit System Surtax Audit," herein.
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010-8616-7788/4/AM ERICAS
ESTIMATED SOURCES AND USES OF FUNDS
The proceeds derived from the sale of the Series 2018 Bonds and other available monies are
expected to be used as follows:
Series 2018A Series 2018B Series 2018C
Bonds Bonds Bonds
SOURCES:
Principal Amount of Series 2018 $ $ $
Bonds
[Plus] [Less] [Net] Original Issue
[Discount] [Premium]
Other Available Monies')
TOTAL SOURCES $ $ $
USES:
Deposit to Escrow Funds $ $ $
Deposit to Project Fund for the
Series 2018C Bonds
Costs of Issuance(2)
Underwriters' Discount
TOTAL USES $ $ $
0) Consists of debt service funds allocable to the Refunded Bonds and unspent proceeds of the Series 2009 Bonds.
(2) Consists of financial advisory and legal fees and expenses, rating agency fees and miscellaneous costs of
issuance.
6
010-8616-7788/4/AM ERICAS
DEBT SERVICE SCHEDULE
The following table sets forth the aggregate debt service requirements for the Series 2018 Bonds
and the unrefunded portions of the Series 2007 Bonds and Series 2009 Bonds.
Unrefunded
Series
Fiscal Year 2007/2009
Ending Series 2018A Bonds Series 2018B Bonds Series 2018C Bonds Bonds Debt Total Debt
September 30' Principal Interest Principal Interest Principal Interest Service Service
2018 $ $ $ $ $ $ $ $
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
Totals $ $ $ $ $ 5 $ $
DESCRIPTION OF THE SERIES 2018 BONDS
General
The Series 2018 Bonds will only be offered and sold to Qualified Institutional Buyers, as defined
in Rule144A under the Securities Act promulgated by the SEC. The Series 2018 Bonds may only be
transferred, resold, or assigned in the secondary market to Qualified Institutional Buyers as described
under the heading "- Transfer Restrictions".
The Series 2018 Bonds will be issued as fully registered, book -entry only bonds in the
denomination of $100,000 and integral multiples of $5,000 in excess of $100,000, through the book -entry
only system maintained by The Depository Trust Company, New York, New York. The Series 2018
Bonds will be numbered consecutively from one (1) upward preceded by the letter "R" prefixed to the
number. The principal of and redemption premium, if any, on the Series 2018 Bonds will be payable
upon presentation and surrender at the principal office of U.S. Bank National Association, Jacksonville,
Florida (the "Paying Agent"). Interest on the Series 2018 Bonds is payable semi-annually on January 1
and July 1 of each year, commencing January 1, 2019. Interest will be paid by check and mailed to the
owners in whose names the Series 2018 Bonds are registered on the close of business on the 15th day
(whether or not a business day) of the month preceding each interest payment date (the "Record Date");
provided, however, that the Holder of Series 2018 Bonds in an aggregate principal amount of at least
$1,000,000 will be entitled to have interest paid by wire transfer as provided in the Resolution. Interest
on the Series 2018 Bonds will be computed on the basis of a 360-day year of twelve 30-day months.
All of the Series 2018 Bonds are being issued as Current Interest Bonds as defined in the Original
Resolution.
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010-8616-7788/4/AM ERICAS
Optional Redemption
The Series 2018 Bonds maturing on and after January 1, 20, are subject to redemption at the
option of the City on or after January 1, 20, in whole or in part at any time, in such manner as will be
determined by the Bond Registrar, at a redemption price equal to the principal amount thereof, plus
accrued interest to the date fixed for redemption without premium.
Mandatory Redemption
The Series 2018A Bonds maturing on January 1, 20 , are subject to mandatory sinking fund
redemption prior to maturity, in part by lot, on January 1 in the following years and in the following
amounts, from and to the extent of Amortization Requirements and whether sufficient moneys are then on
deposit in the Principal and Interest Account for such Series 2018A Bonds, at a redemption price of par,
plus accrued interest to the respective dates of redemption:
Year Principal Amount
*Maturity
The Series 2018A Bonds maturing on January 1, 20 , are subject to mandatory sinking fund
redemption prior to maturity, in part by lot, on January 1 in the following years and in the following
amounts, from and to the extent of Amortization Requirements and whether sufficient moneys are then on
deposit in the Principal and Interest Account for such Series 2018A Bonds, at a redemption price of par,
plus accrued interest to the respective dates of redemption:
Year Principal Amount
*Maturity
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010-8616-7788/4/AM ERICAS
The Series 2018B Bonds maturing on January 1, 20 , are subject to mandatory sinking fund
redemption prior to maturity, in part by lot, on January 1 in the following years and in the following
amounts, from and to the extent of Amortization Requirements and whether sufficient moneys are then on
deposit in the Principal and Interest Account for such Series 2018B Bonds, at a redemption price of par,
plus accrued interest to the respective dates of redemption:
Year Principal Amount
*Maturity
The Series 2018B Bonds maturing on January 1, 20 , are subject to mandatory sinking fund
redemption prior to maturity, in part by lot, on January 1 in the following years and in the following
amounts, from and to the extent of Amortization Requirements and whether sufficient moneys are then on
deposit in the Principal and Interest Account for such Series 2018B Bonds, at a redemption price of par,
plus accrued interest to the respective dates of redemption:
Year Principal Amount
*Maturity
The Series 2018C Bonds maturing on January 1, 20 , are subject to mandatory sinking fund
redemption prior to maturity, in part by lot, on January 1 in the following years and in the following
amounts, from and to the extent of Amortization Requirements and whether sufficient moneys are then on
deposit in the Principal and Interest Account for such Series 2018C Bonds, at a redemption price of par,
plus accrued interest to the respective dates of redemption:
Year Principal Amount
*Maturity
9
010-8616-7788/4/AM ERICAS
The Series 2018C Bonds maturing on January 1, 20 , are subject to mandatory sinking fund
redemption prior to maturity, in part by lot, on January 1 in the following years and in the following
amounts, from and to the extent of Amortization Requirements and whether sufficient moneys are then on
deposit in the Principal and Interest Account for such Series 2018C Bonds, at a redemption price of par,
plus accrued interest to the respective dates of redemption:
Year Principal Amount
*Maturity
Notice and Effect of Redemption
At least thirty (30) days, but not more than sixty (60) days, before the redemption date of any
Series 2018 Bonds, whether such redemption be in whole or in part, the City will cause a notice of any
such redemption signed by the City to be mailed, first class postage prepaid, to all Holders owning Series
2018 Bonds to be redeemed in whole or in part and to any Fiduciaries, but any defect in such notice or the
failure so to mail any such notice to any Holder owning any Series 2018 Bonds will not affect the validity
of the proceedings for the redemption of any other Series 2018 Bonds. Each such notice will set forth the
name of the Series 2018 Bonds or portions thereof to be redeemed, the date fixed for redemption, the
redemption price to be paid, and if less than all the Series 2018 Bonds will be called for redemption, the
maturities of the Series 2018 Bonds to be redeemed, the CUSIP numbers, the name and address
(including contact person and phone number) of the Fiduciary to which Series 2018 Bonds called for
redemption are to be delivered and, if less than all of the Series 2018 Bonds of any one maturity then
Outstanding will be called for redemption, the distinctive numbers and letters, if any, of such Series 2018
Bonds to be redeemed and, in the case of Series 2018 Bonds to be redeemed in part only, the portion of
the principal amount thereof to be redeemed. If any Series 2018 Bond is to be redeemed in part only, the
notice of redemption will also state that on or after the redemption date, upon surrender of such Series
2018 Bond, a new Series 2018 Bond in principal amount equal to the unredeemed portion of such Series
2018 Bond and of the same maturity and bearing the same interest rate will be issued. Any notice as
provided herein will be conclusively presumed to have been duly given, whether or not the owner of the
Series 2018 Bond receives such notice.
In addition to the foregoing notice, the City will cause further notice to be given as set forth
below, but no defect in said further notice nor any failure to give all or any portion of such further notice
will in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above
prescribed:
(i)
Each further notice of redemption will be sent at least 35 days before the redemption date
by registered or certified mail or overnight delivery service to one or more registered
securities depositaries then in the business of holding substantial amounts of obligations
of types comparable to the Series 2018 Bonds and to one or more national information
services that disseminate notices of redemption of obligations such as the Series 2018
Bonds.
(ii) Upon the payment of the redemption price of the Series 2018 Bonds being redeemed,
each check or other transfer of funds issued for such purpose will bear the CUSIP number
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010-8616-7788/4/AM ERICAS
identifying, by issue and maturity, the Series 2018 Bonds being redeemed with the
proceeds of such check or other transfer.
In the case of an optional redemption, any notice of redemption may state that (1) it is
conditioned upon the deposit of moneys, in an amount equal to the amount necessary to effect the
redemption, with the Bond Registrar, Paying Agent or a Fiduciary acting as escrow agent no later than the
redemption date or (2) the City retains the right to rescind such notice on or prior to the scheduled
redemption date (in either case, a "Conditional Redemption"), and such notice and optional redemption
will be of no effect if such moneys are not so deposited or if the notice is rescinded as described in the
Resolution. Any Conditional Redemption may be rescinded to the Bond Register directing the Bond
Registrar to rescind the redemption notice, and the Bond Registrar will give prompt notice of such
rescission to the affected Bondholders. Any Series 2018 Bonds subject to Conditional Redemption where
redemption has been rescinded will remain Outstanding, and neither the rescission nor the failure by the
City to make such funds available will constitute a default under the Resolution.
On the date fixed for redemption, notice having been mailed in the manner and under the
conditions herein above stated, provided that such notice of redemption has not been rescinded as
permitted above, the Series 2018 Bonds or portions thereof called for redemption will be due and payable
at the redemption price provided therefor, plus accrued interest to such date.
Book -Entry Only System
THE FOLLOWING INFORMATION CONCERNING DTC AND DTC'S BOOK -ENTRY
ONLY SYSTEM HAS BEEN OBTAINED FROM SOURCES THAT THE CITY BELIEVES TO BE
RELIABLE, BUT NEITHER THE CITY NOR THE UNDERWRITER TAKE ANY RESPONSIBILITY
FOR THE ACCURACY OR COMPLETENESS THEREOF.
The Depository Trust Company ("DTC"), New York, New York, will act as securities depository
for the Series 2018 Bonds. The Series 2018 Bonds will be issued as fully -registered securities registered
in the name of Cede & Co., as DTC's partnership nominee, or such other name as may be requested by an
authorized representative of DTC. One fully -registered Series 2018 Bond certificate will be issued for
each interest rate of each maturity of the Series 2018 Bonds, each in the aggregate principal amount of
such maturity bearing interest at such interest rate, as set forth on the inside cover page of this Limited
Offering Memorandum, and will be deposited with DTC.
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 one hundred (100) countries that its 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, thereby eliminating 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
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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" and, together
with Direct Participants, "DTC Participants"). DTC has a S&P rating of AA+. The DTC rules applicable
to the DTC Participants are on file with the Securities and Exchange Commission. More information
about DTC can be found at www.dtcc.com.
Purchases of Series 2018 Bonds under the DTC system must be made by or through Direct
Participants, which will receive a credit for the Series 2018 Bonds on DTC's records. The ownership
interest of each actual purchaser of each Series 2018 Bond ("Beneficial Owner") is in turn to be recorded
on the DTC Participants' records. Beneficial Owners will not receive written confirmation from DTC of
their purchase but Beneficial Owners are expected to receive written confirmations providing details of
the transaction, as well as periodic statements of their holdings, from the DTC Participant through which
the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Series 2018
Bonds are to be accomplished by entries made on the books of DTC Participants acting on behalf of
Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests
in Series 2018 Bonds, except in the event that use of the book -entry system for the Series 2018 Bonds is
discontinued.
To facilitate subsequent transfers, all Series 2018 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 Series 2018 Bonds with DTC and
their registration in the name of Cede & Co., or such other DTC nominee, will not effect any change in
beneficial ownership of the Series 2018 Bonds. DTC has no knowledge of the actual Beneficial Owners
of the Series 2018 Bonds; DTC's records reflect only the identity of the Direct Participants to whose
accounts such Series 2018 Bonds are credited, which may or may not be the Beneficial Owners. The
DTC Participants will remain responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by DTC 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 Series 2018 Bonds may wish to take certain steps to augment the
transmission to them of notices of significant events with respect to the Series 2018 Bonds, such as
redemptions, defaults and proposed amendments to the documents securing the Series 2018 Bonds. For
example, Beneficial Owners of the Series 2018 Bonds may wish to ascertain that the nominee holding the
Series 2018 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 Bond Registrar and
request that copies of notices are provided directly to them.
Redemption notices will be sent by the Bond Registrar to DTC. If less than all of the Series 2018
Bonds within an issue are being redeemed, DTC's practice is to determine by lot the amount of the
interest of each Direct Participant in such issue to be redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to
Series 2018 Bonds unless authorized by a Direct Participant in accordance with DTC's Procedures.
Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record
date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to
whose accounts the Series 2018 Bonds are credited on the record date (identified in a listing attached to
the Omnibus Proxy).
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Principal and interest payments on the Series 2018 Bonds will be made to Cede & Co., or to 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
City or the Bond Registrar on the payable date in accordance with their respective holdings shown on
DTC's records. Payments by DTC 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, nor its nominee, the Bond Registrar or the City, subject to any statutory or regulatory requirements
as may be in effect from time to time. Payment of principal and interest to Cede & Co. (or such other
nominee as may be requested by an authorized representative of DTC) is the responsibility of the City or
the Bond Registrar, 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 DTC
Participants.
When reference is made to any action which is required or permitted to be taken by the Beneficial
Owners, such reference will only relate to those permitted to act (by statute, regulation or otherwise) on
behalf of such Beneficial Owners for such purposes. When notices are given, they will be sent by the
City only to DTC.
NEITHER THE CITY NOR THE BOND REGISTRAR WILL HAVE ANY RESPONSIBILITY
OR OBLIGATION TO ANY DTC PARTICIPANT OR THE PERSONS FOR WHOM THEY ACT AS
NOMINEES WITH RESPECT TO THE SERIES 2018 BONDS IN RESPECT OF THE ACCURACY
OF ANY RECORDS MAINTAINED BY DTC OR ANY DTC PARTICIPANT, THE PAYMENT BY
DTC OR ANY DTC PARTICIPANT OF ANY AMOUNT IN RESPECT OF THE PRINCIPAL OF OR
INTEREST ON THE SERIES 2018 BONDS, ANY NOTICE WHICH IS PERMITTED OR REQUIRED
TO BE GIVEN TO BONDHOLDERS UNDER THE RESOLUTION, THE SELECTION BY DTC OR
ANY DTC PARTICIPANT OR ANY PERSON TO RECEIVE PAYMENT IN THE EVENT OF A
PARTIAL REDEMPTION OF THE SERIES 2018 BONDS, OR ANY CONSENT GIVEN OR OTHER
ACTION TAKEN BY DTC AS BONDHOLDER. SO LONG AS CEDE & CO. IS THE REGISTERED
OWNER OF THE SERIES 2018 BONDS, AS NOMINEE OF DTC, REFERENCES IN THIS LIMITED
OFFERING MEMORANDUM TO THE BONDHOLDERS OR REGISTERED OWNERS OF THE
SERIES 2018 BONDS WILL MEAN CEDE & CO., AND WILL NOT MEAN THE BENEFICIAL
OWNERS OF THE SERIES 2018 BONDS.
Registration, Transfer and Exchange
So long as the Series 2018 Bonds are registered in the name of DTC or its nominee, the following
paragraphs relating to transfer and exchange of Series 2018 Bonds do not apply to the Series 2018 Bonds.
The Bond Registrar will keep books for the registration, exchange and registration of transfer of
Series 2018 Bonds as provided in the Resolution. The Bond Registrar will evidence acceptance of the
duties, obligations and responsibilities of Bond Registrar by execution of the certificate of authentication
on the Series 2018 Bonds.
The transfer of any Series 2018 Bond may be registered only upon the books kept for the
registration of transfer of Series 2018 Bonds upon surrender of such Series 2018 Bond to the Bond
Registrar, together with an assignment duly executed by the Holder or such Holder's attorney or legal
representative in such form as will be satisfactory to the Bond Registrar.
Upon any such exchange or registration of transfer, the City will execute and the Bond Registrar
will authenticate and deliver in exchange for such Series 2018 Bond a new registered Series 2018 Bond or
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Series 2018 Bonds, registered in the name of the transferee, of any denomination or denominations
authorized by the Resolution, in the aggregate principal amount equal to the principal amount of such
Series 2018 Bond surrendered, of the same maturity and bearing interest at the same rate.
All Series 2018 Bonds surrendered in any such exchange or registration of transfer will forthwith
be cancelled by the Bond Registrar. No service charge will be made for any registration of transfer or
exchange of Series 2018 Bonds, but the City and the Bond Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Series 2018 Bonds. The Bond Registrar will not be required (i) to
register the transfer of or to exchange Series 2018 Bonds during a period beginning at the opening of
business fifteen (15) days before the day of mailing of a notice of redemption of Series 2018 Bonds and
ending at the close of business on the day of such mailing or (ii) to register the transfer of or to exchange
any Series 2018 Bond so selected for redemption in whole or in part.
The City, any Paying Agent and the Bond Registrar, and any other agent of the City, may treat
the person in whose name any Series 2018 Bond is registered on the books of the City kept by the Bond
Registrar as the Holder of such Series 2018 Bond for the purpose of receiving payment of principal of and
redemption premium, if any, and interest on such Series 2018 Bond, and for all other purposes
whatsoever, whether such Series 2018 Bond be overdue, and, to the extent permitted by law, neither the
City, any Paying Agent, the Bond Registrar nor any such agent will be affected by any notice to the
contrary.
Transfer Restrictions
Every Series 2018 Bond authenticated and delivered under the Resolution, including any issued
upon transfer, exchange or replacement of such Series 2018 Bond, will be issued and delivered only to
Qualified Institutional Buyers, and each Series 2018 Bond will bear on its face a legend stating such
restriction in substantially the following form:
THIS BOND IS SUBJECT TO TRANSFER RESTRICTIONS. THE INITIAL PURCHASER
HEREOF AND ANY SUBSEQUENT TRANSFEREE, BY PURCHASING THIS BOND, AGREES
FOR THE BENEFIT OF THE CITY OF MIAMI, FLORIDA, THAT THIS BOND MAY BE
TRANSFERRED, RESOLD OR ASSIGNED ONLY TO ANOTHER QUALIFIED INSTITUTIONAL
BUYER. NOTWITHSTANDING ANYTHING IN THE RESOLUTION OR THIS BOND TO THE
CONTRARY, NO TRANSFER, RESALE OR ASSIGNMENT OF THIS BOND SHALL BE
EFFECTIVE UNLESS THE TRANSFER, RESALE OR ASSIGNMENT OF THIS BOND IS TO ANY
PURCHASER, TRANSFEREE, ASSIGNEE OR PARTICIPANT THAT IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A PROMULGATED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. ANY TRANSFER, RESALE OR ASSIGNMENT OR
OTHER DISPOSITION OF THIS BOND, OR ANY PARTICIPATION HEREIN, SHALL BE IN EACH
CASE ONLY IN A MANNER THAT DOES NOT VIOLATE THE SECURITIES ACT OF 1933, AS
AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER. THIS
BOND SHALL BE ISSUED AND SOLD, AND MAY ONLY BE TRANSFERRED, IN
DENOMINATIONS OF $100,000 OR ANY INTEGRAL MULTIPLE OF $5,000 IN EXCESS OF
$100,000.
All purchasers of the Series 2018 Bonds in the initial limited offering will be required to provide
a signed letter in substantially the form included in "APPENDIX F — FORM OF INVESTOR LETTER."
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Replacement of Bonds Mutilated, Destroyed, Stolen or Lost
In case any Series 2018 Bond secured hereby will become mutilated or be destroyed, stolen or
lost, the City will cause to be executed, and the Bond Registrar will authenticate and deliver, a new Series
2018 Bond of like date and tenor in exchange and substitution for such mutilated Series 2018 Bond or in
lieu of and in substitution for such Series 2018 Bond destroyed, stolen or lost, and the Holder will pay the
reasonable expenses and charges of the City and the Bond Registrar in connection therewith and, in case
of a Series 2018 Bond destroyed, stolen or lost, the Holder will file with the Bond Registrar evidence
satisfactory to it and to the City that such Series 2018 Bond was destroyed, stolen or lost, and of such
Holder's ownership thereof, and will furnish the City and the Bond Registrar indemnity satisfactory to
them.
SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2018 BONDS
General
The principal of, redemption premium if any, and interest on the Series 2018 Bonds will be
payable from and secured on a parity with the Parity Bonds solely by a lien upon and a pledge of (i) the
City's portion of the proceeds of the Local Option Gas Taxes, (ii) eighty percent (80%) of the City's
portion of the Transportation Surtax, (iii) twenty percent (20%) of the City's Parking Surcharge, (iv) such
additional revenues designated by a Series Resolution as Designated Revenues under the Resolution, and
(v) all investment income realized by reason of the investment of moneys on deposit or credited to the
Debt Service Fund created by the Resolution, whether such investment income is deposited or credited to
the Designated Revenues Fund or remains in the Account in the Debt Service Fund where earned
(collectively, the "Designated Revenues"). The individual Designated Revenues are described herein
under "LOCAL OPTION GAS TAXES," "TRANSPORTATION SURTAX" and "PARKING
SURCHARGE".
Limited Obligations
THE SERIES 2018 BONDS WILL NOT BE DEEMED TO CONSTITUTE A PLEDGE OF THE
FAITH AND CREDIT OF THE STATE OR OF ANY POLITICAL SUBDIVISION THEREOF,
INCLUDING THE CITY. NEITHER THE FAITH AND CREDIT OF THE STATE NOR THE FAITH
AND CREDIT OF THE CITY ARE PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR
REDEMPTION PREMIUM, IF ANY, OR INTEREST ON THE SERIES 2018 BONDS, AND THE
ISSUANCE OF THE SERIES 2018 BONDS WILL NOT DIRECTLY OR INDIRECTLY OR
CONTINGENTLY OBLIGATE THE STATE OR THE CITY TO LEVY ANY TAXES WHATEVER
THEREFOR OR TO MAKE ANY APPROPRIATION FOR THEIR PAYMENT EXCEPT FROM THE
DESIGNATED REVENUES TO THE EXTENT PROVIDED FOR UNDER THE RESOLUTION. NO
HOLDER OF ANY SERIES 2018 BOND OR ANY CREDIT BANK WILL EVER HAVE THE RIGHT
TO COMPEL THE EXERCISE OF THE AD VALOREM TAXING POWER OF THE CITY TO PAY
SUCH SERIES 2018 BOND OR BE ENTITLED TO PAYMENT OF SUCH SERIES 2018 BOND
FROM ANY MONEYS OR PROPERTY OF THE CITY EXCEPT THE DESIGNATED REVENUES
IN THE MANNER PROVIDED IN THE RESOLUTION.
Establishment of Funds and Accounts
The Resolution establishes several funds and accounts, including the "City of Miami Special
Obligation Bonds Debt Service Fund" (the "Debt Service Fund") and two accounts therein designated the
"Principal and Interest Account" (the "Principal and Interest Account") and the "Expense Account" (the
"Expense Account"), all of which funds and accounts will be held in trust by the Paying Agent. There is
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also created and designated the "City of Miami Special Obligation Bonds Rebate Fund" (the "Rebate
Fund"), which fund will be held in trust by the City. The Resolution also establishes the "City of Miami
Special Obligation Bonds Designated Revenues Fund" (the "Designated Revenues Fund"). The City has
also established, pursuant to the Escrow Deposit Agreement, an Escrow Fund, and will establish within
the Escrow Fund, two separate accounts designated as the "Refunded Series 2007 Bonds Escrow
Account" and the "Refunded Series 2009 Bonds Escrow Account" to be used for the purpose of refunding
the Refunded Series 2007 Bonds and the Refunded Series 2009 Bonds. Moneys in these funds and
accounts (except the Escrow Fund and the Rebate Fund), until applied in accordance with the provisions
of the Resolution, will be subject to a lien and charge in favor of the Holders of the Series 2018 Bonds.
Application of Pledged Funds
The Resolution requires the City to deposit all revenues generated from the Local Option Gas
Taxes, Transportation Surtax and the Parking Surcharge, as the same are collected, to the credit of the
City's general or special fund in which such revenues are received and thereafter promptly transfer the
Designated Revenues to the Designated Revenues Fund. The City will then transfer Designated
Revenues from such Designated Revenues Fund to the Rebate Fund, the Principal and Interest Account,
the Reserve Fund and the accounts established within said Fund and the Expense Account and apply the
same to the payment of required arbitrage rebate payments, the interest on and the principal of the Bonds,
Hedge Obligations, if any, the required deposits, if any, to the Reserve Fund and the fees and expenses
payable from the Expense Account, all in accordance with the provisions of the Resolution.
On or before the Business Day preceding any date on which arbitrage rebate payments under the
Code are required to be made, the Finance Director will withdraw moneys from the Designated Revenues
Fund and deposit to the credit of the Rebate Fund such amounts as directed by the City to make such
arbitrage rebate payments under the Resolution.
Upon receipt, the Finance Director will deposit any Hedge Receipts to the credit of the Principal
and Interest Account.
On or before the twenty-fifth (25th) day of each month, commencing in the month in which the
Series 2018 Bonds are issued, the Finance Director will withdraw from the Designated Revenues Fund
an amount equal to the amount then held for the credit of the Designated Revenues Fund or such lesser
amount as will be required to fund the deposit requirements set forth in clauses (a), (b), (c) and (d) below,
and apply the moneys so withdrawn to make the following payments and deposits in the following order:
(a) Deposit to the credit of the Principal and Interest Account an amount equal to one -sixth
(1/6th) of the interest becoming due on the Bonds on the next semiannual Interest Payment Date;
provided, however, that the amount so deposited on account of interest in each month after the
delivery of the Bonds of any Series up to and including the month immediately preceding the first
Interest Payment Date thereafter of the Bonds of such Series will be that amount that when
multiplied by the number of such deposits will be equal to the amount of interest payable on such
Bonds on such first Interest Payment Date less the amount of any accrued interest paid on such
Bonds and deposited to the credit of the Principal and Interest Account;
(b) Deposit to the credit of the Principal and Interest Account an amount equal to the sum of
(i) one -twelfth (1/12th) of the principal of Serial Bonds that will mature and become due on the
next annual maturity date and (ii) one -twelfth (1/12th) of the Amortization Requirements that will
become due and payable within the next Fiscal Year, such deposits to commence in such month
or to be adjusted in such amounts as will ensure that on the dates such principal or Amortization
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Requirements are due and payable sufficient moneys will be on deposit in the Principal and
Interest Account.
Notwithstanding the foregoing provisions, moneys will not be required to be deposited to the
credit of the Principal and Interest Account (A) pursuant to clause (a) above if the amount then to
the credit thereof is equal to the interest becoming due and payable on the Bonds on the next
Interest Payment Date and (B) pursuant to clause (b) above if the amount then to the credit
thereof is equal to the sum of (i) the principal of Serial Bonds maturing on the next maturity date
and (ii) the Amortization Requirement for such Fiscal Year on account of the Term Bonds
Outstanding.
If the period between Interest Payment Dates is other than six (6) months or the period between
principal payment dates is other than twelve (12) months, then such monthly deposits will be
increased or decreased, as appropriate, in sufficient amounts to provide the required interest
amount coming due on the next Interest Payment Date or the principal amount maturing or
Amortization Requirement due on the next principal payment date or redemption date, as
applicable. Provided, further that such amounts to be deposited will be adjusted to provide for
any Hedge Obligations then due to a Hedge Counterparty (excluding any Hedge Termination
Payment).
(c) Deposit to the credit of the Reserve Fund (or each Account within the Reserve Fund to
the extent that a Reserve Account has been established within the Reserve Fund for a particular
Series of Bonds), without priority of one Account over another, if any, beginning with respect to
each Series of Bonds for which a Series Reserve Fund Requirement has been established on the
twenty-fifth (25th) day of the month in which such Series of Bonds are delivered to the
purchasers thereof, such sums as will be at least sufficient to pay an amount equal to one -twelfth
(1/12th) of the difference between the amount, if any, on deposit in the Reserve Fund or Account
therein (including any Reserve Fund Insurance Policy or Reserve Fund Letter of Credit) on the
date of issuance of the Series of Bonds and the increase in the amount required to be held therein
due to such Series Reserve Fund Requirement, if any, for such Series of Bonds, and, provided,
further, that no payments will be required to be made into the Reserve Fund or any Account
whenever and as long as the amount deposited therein (including any Reserve Fund Insurance
Policy or Reserve Fund Letter of Credit) will be equal to all of the Series Reserve Fund
Requirements for all Series of Bonds to which such Reserve Fund or Account therein relates.
Notwithstanding the foregoing provisions, in lieu of or in substitution for the required deposits, if
any, hereunder (including existing deposits) into the Reserve Fund or any Account therein, the
City may cause to be deposited into the Reserve Fund or any Account therein, for any Series of
Bonds, a Reserve Fund Insurance Policy or a Reserve Fund Letter of Credit for the benefit of the
holders of the Bonds of such Series in an amount equal to the difference between the applicable
Series Reserve Fund Requirement and the sums to remain on deposit in the Reserve Fund or any
Account therein, after the deposit of such Reserve Fund Insurance Policy or Reserve Fund Letter
of Credit, if any, which Reserve Fund Insurance Policy or Reserve Fund Letter of Credit will be
payable or available to be drawn upon, as the case may be (upon the giving of notice as required
thereunder), on any Interest Payment Date on which a deficiency exists with respect to the
applicable Series of Bonds which cannot be cured by all moneys in any Fund or Account,
including the applicable Account, if any, in the Reserve Fund under the Resolution, held pursuant
to the Resolution and available for such purpose. If a disbursement is made under a Reserve
Fund Insurance Policy or Reserve Fund Letter of Credit, the City will be obligated to either
reinstate the maximum limits of such Reserve Fund Insurance Policy or Reserve Fund Letter of
Credit within twelve (12) months following such disbursement or to deposit into the Reserve
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Fund or applicable Account therein, as provided in the next paragraph, funds in the amount of the
disbursements made under such Reserve Fund Insurance Policy or Reserve Fund Letter of Credit,
or a combination of such alternatives.
In the event that any moneys will be withdrawn from the Reserve Fund or any Account therein
for payments into the Principal and Interest Account, such withdrawals will be subsequently
restored in the manner described in the first paragraph of this clause (c) from the Designated
Revenues available after all required payments have been made into the Principal and Interest
Account, including any deficiencies for prior payments, unless restored by the reinstatement of
the maximum limits of a Reserve Fund Insurance Policy or Reserve Fund Letter of Credit
(without priority of one Account over another Account, if any).
In the event that a Reserve Fund Insurance Policy or Reserve Fund Letter of Credit will be drawn
upon, the principal portion of the related payment obligations to the issuer of such Reserve Fund
Insurance Policy or Reserve Fund Letter of Credit will be paid, after all required payments have
been made to the Principal and Interest Account, including any deficiencies for prior payments, in
accordance with the terms of any agreement between the City and such issuer, on a parity and on
a pro-rata basis with all other obligations payable under this clause (c) to other issuers of any
Reserve Fund Letter of Credit or Reserve Fund Insurance Policy and cash funding requirements
to the different Accounts established for each Series of Bonds but prior to making any cash
deposit to the Account to which such insurance policy or Letter of Credit relates, if any, provided
that such Insurance Policy or Letter of Credit is reinstated in the amount of such payment
concurrently with the receipt of such payment by the issuer thereof.
(d) Any balance remaining after satisfying the requirements of clauses (a), (b) and (c) above
will be deposited to the credit of the Expense Account in an amount sufficient to pay (i) the fees,
interest and other amounts owing any issuer of a Reserve Fund Insurance Policy or Reserve Fund
Letter of Credit, (ii) any fees and expenses of Fiduciaries or Hedge Counterparties coming due in
such month and any other administrative fees and expenses coming due in such month with
respect to Bonds, (iii) any costs of issuance of a Series of Bonds that remain to be paid, and (iv)
any Hedge Termination Payment that is due.
(e) Any such balance remaining in the Designated Revenues Fund after making the
withdrawals and satisfying the requirements mentioned in clauses (a), (b), (c) and (d) above will
be deposited to pay principal and interest on Subordinated Indebtedness in the manner provided
in the Resolution authorizing such Subordinated Indebtedness.
If the moneys withdrawn for deposits to the above funds and accounts and for making the other
required payments as above set forth will not be sufficient to make such deposits and payments, the
requirements in each month thereafter for each of the above deposits and payments for which the required
monthly deposit or payment has not been made will be cumulative and the amount of any deficiency in
any such monthly deposit or payment will be added to the amount otherwise required to be deposited in
each month thereafter until such time as such deficiency will have been made up.
The balance, if any, remaining to the credit of the Designated Revenue Fund after making the
withdrawals and satisfying the requirements mentioned in clauses (a), (b), (c), (d) and (e) above in any
Fiscal Year will be withdrawn and deposited to the general or special revenue fund in the same
percentage in which such Designated Revenues were originally deposited to the Designated Revenues
Fund.
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No Reserve Fund
No debt service reserve fund will be established as security for the Series 2018 Bonds. [Confirm]
Hedge Agreements
As of the date hereof, the City has not entered into and does not anticipate entering into any
Hedge Agreement with respect to the Series 2018 Bonds. In the event that the City enters into a Hedge
Agreement with respect to any Bonds issued under the Resolution, all Hedge Receipts received pursuant
thereto will be deposited to the credit of the Principal and Interest Account and all Hedge Obligations
then due to such Hedge Counterparty under the Hedge Agreement (excluding any Hedge Termination
Payment) will be payable to such Hedge Counterparty on a parity with the payment of interest then due
on the Bonds. Any Hedge Termination Payment due to a Hedge Counterparty will be payable on a
subordinate basis to the payment of principal and interest on the Bonds and any Hedge Obligations.
Issuance of Additional Bonds
The Resolution provides that one or more Series of Additional Bonds of the City may be issued
under and secured by the Resolution, on a parity as to the pledge of the Designated Revenues with the
Series 2018 Bonds and the Parity Bonds, subject to the conditions hereinafter provided, among other
things, from time to time for the purpose of paying all or any part of the cost of any capital improvements
for roadway or transportation purposes not inconsistent with the authorized use of the Designated
Revenues.
Before such Additional Bonds will be delivered by the Bond Registrar, there will be filed with the
City Manager a certificate of the Finance Director demonstrating that the percentage derived by dividing
the amount of the Designated Revenues received by the City during any twelve (12) consecutive months
in the eighteen (18) months next preceding the date of delivery of the Additional Bonds then requested to
be delivered, by the Maximum Principal and Interest Requirements, including the Principal and Interest
Requirements with respect to the Additional Bonds then to be delivered, for any future Fiscal Year is not
less than one hundred thirty-five percent (135%).
Refunding Bonds
One or more Series of Refunding Bonds of the City may be issued from time to time under and
secured by the Resolution, subject to the conditions hereinafter provided in this Section, for the purpose
of providing funds for refunding all or any Bonds of any one or more Series of Bonds then Outstanding,
including the payment of any redemption premium thereon and interest that will accrue on such Bonds to
the redemption date or stated maturity date or dates, funding any funds and accounts under the Resolution
and paying any expenses in connection with such refunding and for any related lawful purpose. Except as
to any Credit Facility or Insurance Policy and as to any difference in the maturities thereof or the rate or
rates of interest or the provisions for redemption and except for such differences, if any, respecting the
use of moneys in the various funds and accounts created in the Resolution, such Series of Refunding
Bonds will be on a parity with and will be entitled to the same benefit and security of the Resolution as all
other Bonds theretofore or thereafter issued under the Resolution.
Prior to or simultaneously with the authentication and delivery of such Refunding Bonds by the
Bond Registrar to or upon the order of the purchasers thereof or the designated representative, there will
be filed with the City Manager: (A) a Certificate of the Finance Director showing that the aggregate
Principal and Interest Requirements on account of all Bonds Outstanding (after the issuance of such
Refunding Bonds and after the redemption or provision for payment of the Bonds to be refunded)
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following the Fiscal Year in which such Refunding Bonds are to be delivered will not exceed the
aggregate Principal and Interest Requirements on account of all the Bonds Outstanding (including the
Bonds to be refunded) immediately prior to the issuance of such Refunding Bonds following the Fiscal
Year in which such Refunding Bonds are to be delivered; (B) the net present value of the aggregate
Principal and Interest Requirements on account of all Bonds Outstanding (after the issuance of such
Refunding Bonds and after the redemption or provision for payment of the Bonds to be refunded)
following the Fiscal Year in which such Refunding Bonds are to be delivered is less than the net present
value of the aggregate Principal and Interest Requirements on account of all Bonds Outstanding
(including the Bonds to be refunded) immediately prior to the issuance of such Refunding Bonds
following the Fiscal Year in which such Refunding Bonds are to be delivered; or (C) assuming the Bonds
to be refunded are not then Outstanding, a certificate of the Finance Director demonstrating that the
percentage derived by dividing the amount of the Designated Revenues received by the City during any
twelve (12) consecutive months in the eighteen (18) months next preceding the date of delivery of the
Refunding Bonds then requested to be delivered, by the Maximum Principal and Interest Requirements on
all Outstanding Bonds, including the Principal and Interest Requirements with respect to the Refunding
Bonds then to be delivered (but not including the Bonds to be refunded), for any future Fiscal Year is not
less than one hundred thirty-five per centum (135%); provided, however, that for purposes of the
calculation required by this subclause (C) in connection with the issuance of Refunding Bonds pursuant to
a forward refunding or forward delivery or other such similar arrangements, the "date of delivery" of the
Refunding Bonds will be deemed to be the date on which the contract or agreement providing for such
forward refunding, forward delivery or other similar arrangement is executed and delivered (instead of the
actual future date of delivery of the Refunding Bonds).
Economic Environment Impact on Designated Revenues
Designated Revenues received from Local Option Gas Taxes, a Transportation Surtax, and the
City's Parking Surcharge, fluctuate based on general economic conditions. A significant decline in the
amount of Designated Revenues collected due to a sustained economic downturn could impair the ability
of the City to pay principal of and interest on the Series 2018 Bonds. See "LOCAL OPTION GAS
TAXES," "TRANSPORTATION SURTAX" and "PARKING SURCHARGE" herein for historical
collections of the individual Designated Revenues.
Covenant as to Designated Revenues
The City covenants that while any of the Bonds issued under the provisions of the Resolution will
be Outstanding it will not take any action or fail to take any action which might result in a suspension or
termination of the receipt of the Designated Revenues and it will take all appropriate action to keep and
maintain the Designated Revenues at the highest possible level and that, subject to covenants with Credit
Banks and Insurers, it will not create or permit to be created any charge or lien on the proceeds of the
Designated Revenues ranking equally with or prior to the charge or lien on such proceeds of the Bonds
issued under the provisions of the Resolution.
There was an attempt in May 2009 to repeal the Transportation Surtax which failed. The
proposed ordinance included language which provided for continuing the collection of the Transportation
Surtax until all outstanding contractual obligations secured by the Transportation Surtax were satisfied.
There is no way to predict whether another attempt will be made to repeal the Transportation Surtax,
whether such attempt will include language enabling collection of the Transportation Surtax to fulfill
existing contractual obligations secured by the Transportation Surtax, or how its repeal would impact the
ability of the City to pay principal of and interest on the Series 2018 Bonds.
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LOCAL OPTION GAS TAXES
General
As a portion of the Designated Revenues, the City is pledging the Local Option Gas Taxes to
secure the Series 2018 Bonds. Local Option Gas Taxes are defined in the Resolution to mean collectively
(i) the City's portion of a tax imposed by Ordinance No. 93-63 enacted by Miami -Dade County (the
"County") on June 15, 1993, as amended by Ordinance No. 97-156 enacted by the County on September
17, 1997, as may be amended, pursuant to Section 336.025(1)(a), Florida Statues, as amended and
distributed pursuant to an Interlocal Agreement dated as of May 20, 1993, as amended, among the
County, the City and the other municipalities located in the County (the "Gas Tax Interlocal"); and (ii) the
City's portion of a tax imposed by Ordinance No. 93-91 enacted by the County on September 20, 1993, as
amended by Ordinance No. 96-101 enacted on June 20, 1996, as may be amended, pursuant to Section
336.025(1)(b), Florida Statues, as amended and Section 336.025(4), Florida Statutes, as amended, and
distributed pursuant to an Interlocal Agreement dated as of July 27, 1993 (the "Second Gas Tax
Interlocal").
Each county in the State is authorized to levy a tax, of between one cent and twelve cents per net
gallon on motor fuel sold in such county in the form of three separate levies. The first levy is a tax of one
to six cents per net gallon on motor fuel and diesel fuel and may be authorized in a county by an
ordinance enacted by a majority vote of the governing body of a county or by voter referendum, and used
to fund specified transportation expenditures. As a result of statewide equalization authorized by the
Florida Legislature, the County levies all six cents of the first levy, which levy was approved by
Ordinance No. 88-49, as amended and supplemented by Ordinance No. 93-63, as amended by Ordinance
No. 97-156 (the "First Levy"). See "LOCAL OPTION GAS TAXES — First Levy" below. All of
Florida's sixty-seven counties levy this portion of the Local Option Fuel Tax at the maximum rate of six
cents. The second levy is a tax of one to five cents per net gallon on motor fuel, but not diesel fuel, and
may be authorized in a county by an ordinance enacted by a majority plus one vote of the governing body
of a county or by voter referendum, and used to fund transportation expenditures needed to meet the
requirements of the capital improvements element of an adopted local government comprehensive plan.
The County levies three cents of the second levy which levy was approved by Ordinance No. 93-91, as
amended by Ordinance No. 96-101 (the "Second Levy"). See "LOCAL OPTION GAS TAXES — Second
Levy" below. The third levy is a tax of one cent per net gallon on motor fuel and diesel fuel and may be
authorized in a county by an ordinance enacted by an extraordinary vote of the governing body of a
county or by voter referendum (the "Ninth Cent Tax"). The City does not receive any portion of the
Ninth Cent Tax.
Collection and Distribution
The Florida Department of Revenue ("FDOR") collects pursuant to Section 336.025(1)(a),
Florida Statues, the local option fuel tax, consisting of the proceeds from the one to six cents and the one
to five cents fuel taxes (collectively, "Local Option Fuel Tax") in each county and deposits the proceeds
into the State's Local Option Fuel Tax Trust Fund. The Local Option Fuel Tax Trust Fund is subject to a
7% charge imposed by the State, representing a share of the cost of general government of the State. This
charge is deducted from the Local Option Fuel Tax Trust Fund and is deposited in the General Revenue
Fund of the State. FDOR is authorized to deduct certain administrative costs incurred in collecting,
administering, enforcing and distributing the proceeds of such tax to the counties in an amount not to
exceed 2% of total collections from the Local Option Fuel Tax Trust Fund.
The net proceeds collected from the Local Option Fuel Tax are distributed monthly by FDOR to
each eligible county and the eligible municipalities therein according to a distribution formula determined
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at the local level by interlocal agreement between the county and the municipalities within the county's
boundaries representing a majority of the population of the incorporated area within the county. If no
interlocal agreement is established, then the distribution is based on the relative transportation
expenditures of the county and the municipalities therein for the preceding 5 years. After the initial levy,
the distribution is recalculated every 10 years.
Upon any newly incorporated municipality becoming eligible to receive the Local Option Fuel
Tax, the distribution will be equal to (i) the county's per lane mile expenditure in the previous year times
the number of lane miles within the jurisdiction of the municipality, in which the county's share will be
reduced proportionally, or (ii) determined by the local act incorporating the municipality. However, such
distribution will not materially or adversely affect the rights of holders of outstanding bonds which are
backed by taxes authorized pursuant to Section 336.025(1), Florida Statutes, and the amounts distributed
to the county and each municipality will not be reduced below the amount necessary for the payment of
principal and interest and reserves for principal and interest as required under the covenants of any bond
resolution outstanding on the date of the re -determination of the distribution formula.
First Levy
The County and the municipalities within the County have entered into the Gas Tax Interlocal to
provide for the distribution of the proceeds of the First Levy in accordance with a formula. Under the
formula provided in the Gas Tax Interlocal, the County receives 70.4% of the proceeds and the
municipalities receive 26.9% of the proceeds ("Municipal Portion"). 74% of the Municipal Portion is
allocated based on the ratio of the population of each eligible incorporated municipality to the total
population of all eligible incorporated municipalities in the County. The remaining 26% of the Municipal
Portion is allocated based on the ratio of total centerline miles of roadway maintained by each eligible
incorporated municipality compared to the total centerline miles maintained by all eligible incorporated
municipalities in the County. In the event that an eligible municipality annexes an area of unincorporated
area or a newly incorporated municipality becomes eligible for participation, the County's share will be
reduced. During the term of the Gas Tax Interlocal, the County's share of the annual proceeds of the First
Levy cannot be reduced below 80% of the original 74% share (which equates to approximately 59% of
the total net proceeds of the First Levy), regardless of future incorporation. Pursuant to the Gas Tax
Interlocal and Ordinance No. 88-49, as amended and supplemented, the First Levy is set to expire on
August 31, 2023. The First Levy has been extended in the past, but there is no guarantee that it will be
extended in the future. See the table under the heading "HISTORICAL DESIGNATED REVENUES
AND DEBT SERVICE COVERAGE" herein.
There are 35 incorporated municipalities in the County. Pursuant to the formula provided in the
current Gas Tax Interlocal, the percentage share of the fiscal year 2016-2017 proceeds received by the
City was $5,294,925 or 8.05%, according to the City's internal financial system records.
FDOR has estimated the fiscal year 2017-2018 distribution for the City to be $5,319,973, as
published in the Florida Legislature's Office of Economic and Demographic Research, Local Government
Financial Information Handbook, December 2017 (the "Financial Information Handbook").
Use of Revenue. Generally, county and municipal governments may only use monies received
from the First Levy for transportation expenditures, defined as:
(a) public transportation operations and maintenance;
(b) roadway and right-of-way maintenance and equipment and structures used primarily for
the storage and maintenance of such equipment;
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(c) roadway and right-of-way drainage;
(d) street lighting installation, operation, maintenance and repair;
(e) traffic signs, traffic engineering, signalization and pavement markings, operation,
maintenance and repair;
(f)
bridge maintenance and operation; and
(g) debt service and current expenditures for transportation capital projects in the foregoing
program areas including the construction and reconstruction of roads and sidewalks.
Second Levy
The County and the municipalities within the County have entered into the Second Gas Tax
Interlocal to provide for the distribution of the proceeds of the Second Levy in accordance with a formula.
Under the formula provided in the Second Gas Tax Interlocal, the County receives 74% of the proceeds
and the municipalities receive 26% of the proceeds ("Second Municipal Portion"). 75% of the Second
Municipal Portion is allocated based on the ratio of the population of each eligible incorporated
municipality to the total population of all eligible incorporated municipalities in the County. The
remaining 25% of the Second Municipal Portion is allocated based on the ratio of total centerline miles of
roadway maintained by each eligible incorporated municipality compared to the total centerline miles
maintained by all eligible incorporated municipalities in the County. The Second Levy does not have an
expiration.
There are 35 incorporated municipalities in the County. Pursuant to the formula provided in the
Second Gas Tax Interlocal, the percentage share of the fiscal year 2016-2017 proceeds received by the
City was $2,058,519 or 7.07%, according to the City's internal financial system records.
FDOR has estimated the Fiscal Year 2017-2018 distribution for the City to be $2,058,745, as
published in the Financial Information Handbook.
Use of Revenue. Generally, county and municipal governments may use monies received from
the Second Levy only for transportation expenditures needed to meet the requirements of the capital
improvements element of an adopted comprehensive plan or for expenditures needed to meet immediate
local transportation problems and for other transportation -related expenditures that are critical for
building comprehensive roadway networks by local governments. Expenditures will not include routine
maintenance of roads.
Eligibility
In order to be eligible to receive a distribution of funds from the Local Option Fuel Tax Trust
Fund, each county or municipality must have:
(i) reported its finances for its most recently completed fiscal year to the Department of
Financial Services pursuant to Section 218.32, Florida Statutes;
(ii) made provisions for annual postaudits of financial accounts in accordance with
provisions of law;
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(iii) levied, as shown on its most recent financial report, ad valorem taxes, exclusive of taxes
levied for debt service or other special millages authorized by the voters, to produce the revenue
equivalent to a millage rate of 3 mills on the dollar based upon 1973 taxable values or, in order to produce
revenue equivalent to that which would otherwise be produced by such 3 mill ad valorem tax, to have
received certain revenues from a county (in the case of a municipality), an occupational license tax, utility
tax, or levied ad valorem tax, or any combination of those four sources;
(iv) certified that persons in its employ as law enforcement officers meet certain
qualifications for employment, and receive certain compensation;
(v) certified that persons in its employ as firefighters meet certain employment qualifications
are eligible for certain compensation;
(vi) certified that each dependent special district that is budgeted separately from the general
budget of such county or municipality has met the provisions for annual postaudit of its financial accounts
in accordance with law; and
(vii) certified to FDOR that it has complied with certain procedures regarding the
establishment of the ad valorem tax millage of the county or municipality as required by law.
Any funds otherwise undistributed because of ineligibility of a county or municipality will be
distributed to the eligible governments within the applicable county in proportion to other monies
distributed pursuant to Section 336.025, Florida Statutes.
The City represents that it has continuously been in compliance with the statutory eligibility
requirements for the Local Option Fuel Tax in the past and that it has covenanted in the Resolution to do
so in the future.
Historical Gasoline Sales in the County
The volume of motor and special fuel sold in the County is set forth below for the State fiscal
years indicated:
MIAMI-DADE COUNTY, FLORIDA
NUMBER OF TAXABLE GALLONS SOLD
State Fiscal Year
Ended June 30 Gasoline & Gasohol Special Fuel Total Gallons
2013 969,969,168 129,975,919 1,099,945,087
2014 984,720,613 131,451,904 1,116,172,517
2015 1,010,555,149 136,798,000 1,147,353,149
2016 1,026,435,942 130,850,762 1,157,286,704
2017 1,052,406,246 138,260,506 1,190,666,752
Source: Florida Department of Revenue
www.floridarevenue.com/taxes/Pages/distributions.aspx.
The amount of Local Option Fuel Tax received by the City from the County is dependent upon
numerous factors, including the amount of motor fuel and diesel fuel sold in the County. Furthermore,
incorporation of additional municipalities within the County could affect the amount of Local Option Fuel
Tax Revenues distributable to the County and to each municipality. The amount of Local Option Fuel
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Tax Revenues received by the City from the County may be adversely impacted by changes in the supply
or demand for or the price of motor fuel, special fuel or diesel fuel. Most of the factors that affect the
amount of Local Option Fuel Tax Revenues distributable to the City are beyond the control of the County
and the City.
The following table sets forth the amount of historical Local Option Gas Taxes revenues received
by the City for the fiscal years ended September 30, 2013 through 2017.
CITY OF MIAMI, FLORIDA
LOCAL OPTION GAS TAXES
Local Percentage
Fiscal Year Option Gas Increase
Ended September 30 Taxes Received') (Decrease)
2013 $6,625,945 0.85%
2014 6,828,949 3.06
2015 7,146,475 4.65
2016 7,084,039 (0.87)
2017 7,353,444 3.80
Source: City of Miami, Florida Finance Dept.
(1) Includes the First Levy and the Second Levy.
TRANSPORTATION SURTAX
Gen eral
As a portion of the Designated Revenues, the City is pledging eighty percent (80%) of the
Transportation Surtax to the Series 2018 Bonds. The Transportation Surtax is defined in the Resolution
to mean the City's portion of the Charter County Transit System Sales Surtax approved by the electorate
of the County on November 5, 2002, pursuant to Section 212.055(1), Florida Statutes and Ordinance
No. 02-116 (the "Transit System Sales Surtax Ordinance"), enacted by the County on July 9, 2002, as
amended (the "Transit System Sales Surtax") and distributed to the City pursuant to an Interlocal
Agreement between the County and the City dated as of July 10, 2007, approved pursuant to
Resolution No. 07-0272 adopted by the City on May 17, 2007 (the "Transit Interlocal").
Levy of Transit System Sales Surtax
Subject to the limitations and exemptions set forth in Chapter 212 of the Florida Statutes, the
State imposes a tax on certain sales, use, services, rentals, admissions and other transactions occurring in
the State, including, but not limited to, the rental of living quarters or sleeping or housekeeping
accommodations for a period of six months or less, items or articles of tangible personal property sold at
retail, the rental or lease of real property for purposes other than, among other things, agricultural uses or
dwelling units, and the lease or rental of tangible personal property. Pursuant to Section 212.055(1) of
the Florida Statutes, the County is authorized to impose the Transit System Sales Surtax on all
transactions occurring in the County that are subject to the State tax imposed on the above -referenced
sales, use, services, rentals, admissions and other transactions.
Pursuant to Section 212.055(1), Florida Statutes, the County is authorized to levy a discretionary
sales surtax of up to 1% to be used for the purposes of, among other things, planning, developing,
constructing, operating and maintaining roads, bridges, bus systems and fixed guideway systems. The
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County elected to levy a one half of one percent discretionary sales tax, subject to the approval of the
County's electorate at the time that the Transit System Sales Surtax Ordinance was enacted. The
Transit System Sales Surtax was approved by a majority of the County's electorate at a special
election held on November 5, 2002. The County has imposed the Transit System Sales Surtax on all
transactions occurring in the County that are subject to the State tax imposed on sales, use, services,
rentals, admissions, and other transactions pursuant to Chapter 212, Florida Statutes. The Transit System
Sales Surtax will remain in effect until the Transit System Sales Surtax Ordinance is repealed.
Collection, Distribution and Uses
FDOR administers, collects and enforces the Transit System Sales Surtax. The proceeds of the
Transit System Sales Surtax are transferred by FDOR into a separate account established for the County in
the Discretionary Sales Surtax Clearing Trust Fund. FDOR distributes the proceeds of the Transit System
Sales Surtax less the cost of administration (the "Net Transit System Sales Surtax Proceeds") to the County
each month.
Pursuant to the Transit System Sales Surtax Ordinance, the Net Transit System Sales Surtax
Proceeds are deposited into a special fund set aside from other County funds in the custody of the Finance
Director of the County (the "Transit System Sales Surtax Trust Fund"). Twenty percent of the Net Transit
System Sales Surtax Proceeds (the "Cities' Distribution") are distributed annually by the County to each
city existing within the County as of November 5, 2002 (including the City), so long as each such city
(i) continues to provide the same level of general fund support for transportation in subsequent fiscal
years that is in each such city's fiscal year 2001-2002 budget; (ii) uses the Net Transit System Sales Surtax
Proceeds to supplement rather than replace each such city's general fund support for transportation; and
(iii) applies 20% of any Net Transit System Sales Surtax Proceeds received from the County to transit
uses in the nature of (a) circulator buses, bus shelters, bus pullout bays or other transit -related
infrastructure (or, alternatively, contracts with the County for the County to apply such Net Transit System
Sales Surtax Proceeds to a County project that enhances traffic mobility within the city and immediately
adjacent areas) and (b) on demand transportation services as defined in Section 212.055(1)(c), Florida
Statutes to low income, elderly or disabled individuals. The Net Transit System Sales Surtax Proceeds
are distributed among the municipalities on a pro-rata basis based on the ratio such city's population bears
to the total population in all eligible cities. Newly incorporated municipalities will have the right to
negotiate with the County for a pro-rata share of the County's portion of Net Transit System Sales Surtax
Proceeds. The City is pledging 80% of the Transit System Sales Surtax received by the City from the
County to the Series 2018 Bonds and therefore the other 20% remains available for transit uses as
provided above. The City is in compliance with all requirements to be eligible to receive the Net Transit
System Sales Surtax Proceeds.
Effective July 1, 2009, an amendment to Section 212.055(1) of the Florida Statutes requires any
charter county that has entered into interlocal agreements for the distribution of Net Transit System Sales
Surtax Proceeds with its municipalities to revise such interlocal agreements every 5 years for the purpose
of including any municipalities created since the execution of the previous interlocal agreements.
Accordingly, the County is required to revise its existing interlocal agreements every 5 years to include
cities that were not incorporated at the time such interlocal agreements were executed. To date, the
County has entered into thirty-one (31) interlocal agreements (the "Existing Interlocal Agreements")
relative to the Cities' Distribution, (including the City), which expired in 2012. Until new Interlocal
Agreements are entered into by the County and each municipality, the County will continue to distribute
the Cities' Distribution pursuant to the Existing Interlocal Agreements.
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If the County does not enter into new interlocal agreements described in the preceding paragraph
it can elect to pay the new cities out of the County's share of the Net Transit System Sales Surtax
Proceeds.
The following table sets forth the amount of historical Transit System Sales Surtax revenues
received by the City for the fiscal years ended September 30, 2013 through 2017. The decrease in the
Transportation Surtax for the fiscal year ended September 30, 2016 is attributed to the Transit System
Surtax Audit (hereinafter defined) underway by Miami -Dade County Audit and Management Services
("AMS"), as further described below.
CITY OF MIAMI, FLORIDA
HISTORICAL RECEIPTS OF TRANSIT SYSTEM SALES SURTAX
Fiscal Year Percentage
Ended Transportation 80% of Transportation Increase
September 30 Surtax Received Surtax Received (Decrease)
2013 $14,470,790 $11,576,632 6.89%
2014 15,297,188 12,237,750 5.71
2015 16,340,751 13,072,601 6.82
2016 15,755,819* 12,604,655 (3.58)
2017 16,633,464* 13,306,771 5.57
Source: City of Miami, Florida Finance Dept.
* 2016 and 2017 Transportation Surtax received is net of the CITT withholding described below.
Transit System Sales Surtax Audit
AMS periodically conducts audits of municipalities within the County that receive Transit System
Sales Surtax revenues. AMS conducted an audit related to the City's Transit System Sales Surtax funding,
the results of which were included in the Audit Report on the City of Miami's Charter County Transit
System Surtax Review dated September 30, 2015 (the "Transit System Surtax Audit") covering fiscal
years 2011 through 2013. AMS recommended that (i) a separate bank account was necessary to account
for Transit System Sales Surtax funds dispensed to the City; (ii) debt service payments be disallowed due
to a large amount of bond proceeds remaining unspent; (iii) costs claimed by the City for On Demand
Transportation Services be disallowed; (iv) certain Transit System Sales Surtax funds used to pay debt
service should have been paid from another source; (v) funds used for storm sewer and drainage projects
be disallowed because the City had stormwater fees available; (vi) expenditures for program management
be disallowed; (vii) $49,984 in expenses for a Marlins Park parking study be disallowed; (viii) $499,025
for sidewalk projects completed prior to November 15, 2013, the date on which sidewalk projects became
eligible, be disallowed; (ix) $2 6 million of uncredited investment income after taking into account all
disallowed costs in interest earned on surtax proceeds certain expenses.
The City refuted several of the Transit System Surtax Audit findings in written responses dated
June 8, 2015 and September 15, 2015. In a letter to the City dated September 13, 2016, the Citizens'
Independent Transportation Trust ("CITT"), as the arbiter between the County and the City, CITT took
the position that (i) a separate bank account to account for Transit System Sales Surtax funds was not
necessary, (ii) approximately $3,301,551 is subject to recapture and CITT will withhold approximately
$92,000 per month from the City's Transit System Sales Surtax allocation until the recapture amount is
complete and (iii) if the $2,971,097 in excess debt service transfers is not reversed by the City, CITT will
withhold an additional $83,000 per month until the recapture is complete. In November 2016, the City
Commission authorized the transfer of $2,971,097 from the Debt Service Fund to the Capital Fund in
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compliance with the audit findings. CITT also expressed concerns relating to the unspent bond proceeds
but determined that recapture of such unspent bond proceeds was premature. Utilizing the remaining
unspent proceeds and interest thereon in defeasance escrow, should eliminate this concern; however, it is
anticipated that the timely expenditure of the proceeds of the Series 2018C Bonds will be subject to
scrutiny by the County in the future. See "PLAN OF REFUNDING — Plan for Use of Remaining
Unspent Proceeds of the Series 2009 Bonds and — The Series 2018 Project" herein. The City has provided
quarterly reports to AMS without incident. The City submitted a report for the second quarter of the
Fiscal Year ending September 30, 2018 on May 4, 2018. [Confirm]
PARKING SURCHARGE
General
As a portion of the Designated Revenues, the City is pledging twenty percent (20%) of the
Parking Surcharge revenues to the Series 2018 Bonds. Parking Surcharge is defined in the Resolution to
mean a 15% parking surcharge to be charged at public parking facilities within the City approved by the
electorate of the City on November 4, 2003, imposed pursuant to Section 166.271, Florida Statutes and
pursuant to Ordinance No. 04-12563 enacted by the City Commission on July 22, 2004, as amended from
time to time, and as amended by Ordinance No. 11-13257 enacted by the City Commission on March 10,
2011.
Levy of Parking Surcharge and Uses
Pursuant to Section 166.271, Florida Statutes, the State authorized the City to impose and collect,
subject to referendum approval by voters in the City, a discretionary per vehicle surcharge of up to fifteen
percent (15%) of the amount charged for the sale, lease, or rental of space at parking facilities within the
City which are open for use to the general public and which are not airports, seaports, county
administration buildings, or other county projects. The Parking Surcharge was approved at an election on
November 4, 2003.
Notwithstanding the foregoing, pursuant to the former Section 218.503(6)(a), the City was
authorized to impose a discretionary per -vehicle surcharge of up to twenty percent (20%) on the gross
revenues of the sale, lease or rental or space at parking facilities within the City which are open for use to
the general public. This provision only applied during the period of time in which the City was declared
to be in a state of financial emergency and such provision expired on June 30, 2006. The 20% surcharge
was collected by the City from Fiscal Years 2000-2004.
No less than sixty (60%) percent and no more than eighty (80%) percent of surcharge proceeds
will be used to reduce the municipality's ad valorem tax millage or to reduce or eliminate non -ad valorem
assessments, unless the municipality has previously used the proceeds from the surcharge levied under
former Section 218.503(6)(b) to reduce the municipality's ad valorem tax millage or to reduce non -ad
valorem assessments.
Not more than forty percent (40%) and not less than twenty percent (20%) of the Parking
Surcharge proceeds will be used to improve transportation, including, but not limited to, street, sidewalk,
roadway, landscape, transit and streetscape beautification improvements and will be used in downtown or
urban core areas.
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Collection
The Parking Surcharge amounts due will be collected by the operator of a parking facility at the
time of, and in addition to, collection of any other amounts for the parking of a motor vehicle in a parking
facility, whether charge is made on an hourly, daily, weekly, monthly, yearly, event, validation programs,
valet or any other basis. All operators will be required to maintain a valid operational license. The
occupational license of an operator will be revoked upon the failure to remit the surcharge amounts for
three consecutive months. No operator will be permitted to operate the parking facility until all arrears
are paid.
The operator of every parking facility will remit funds collected pursuant to the Parking
Surcharge, net of refunds, for the preceding calendar month by the twentieth (20th) day of each calendar
month. The operator will keep records of such funds collected. Whenever any operator fails to keep
records from which the Parking Surcharge may be accurately computed, the City may make use of a
factor developed by surveying other operators of a similar type parking facility, or otherwise compute the
amount of Parking Surcharge due, and this computation will be prima facie correct. Whenever any
operator fails to collect or remit to the City the Parking Surcharge imposed within the time limit therefor,
the City will assess the operator the amount of Parking Surcharge due as determined by the City, plus
interest at the rate of one percent (1%) per month or any fraction thereof, and a penalty of ten percent
(10%) of the Parking Surcharge due on uncollected or unremitted amounts. The operator of a Parking
Facility who: (1) fails, neglects or refuses to collect the Parking Surcharge; or (2) fails, neglects or refuses
to remit the Parking Surcharge; or (3) fails, neglects or refuses to keep accurate records; or (4) submits
any incomplete, false or fraudulent return; or (5) refuses to permit the City to examine books, records and
papers relating to the Parking Surcharge; or (6) fails to fully comply with any or all rules or regulations
promulgated by the City, or to keep complete and proper records as required, will be subject to the
following penalties for each offense: (i) have his or her occupational license revoked; and/or (ii) have a
lien placed upon the parking facility for the sums owed plus interest pursuant to law; and/or (iii) be
subject to an administrative fine in the amount of $500.00; and or (iv) be required to comply with stricter
reporting requirements.
The following table sets forth the amount of historical Parking Surcharge revenues collected by
the City for the fiscal years ended September 30, 2013 through 2017.
CITY OF MIAMI, FLORIDA
HISTORICAL COLLECTION OF PARKING SURCHARGE
Percentage
Fiscal Year Parking 20% of Parking Increase
Ended September 30 Surcharge Revenues Surcharge Revenues (Decrease)
2013 $20,214,285 $4,042,857 22.92%
2014 19,044,351 3,808,870 (5.79)
2015 19,915,428 3,983,086 4.57
2016 21,083,997 4,216,799 5.87
2017 22,153,940 4,430,788 5.07
Source: City of Miami, Florida Finance Dept.
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The following table sets forth the amount of historical Designated Revenues received by the City
for the fiscal years ended September 30, 2013 through 2017.
HISTORICAL DESIGNATED REVENUES AND DEBT SERVICE COVERAGE
Fiscal Year Ended September 30
Local Option
Year Gas Taxes')
2013 $6,625,945
2014 6,828,949
2015 7,146,476
2016 7,084,039
2017 7,353,444
80% of
Transportation
Surtax
$11,576,632
12,237,750
13,072,601
12,604,655
13,306,771
20% of Parking
Surcharge
$4,042,857
3,808,870
3,983,086
4,216,799
4,430,788
Total
Designated
Revenues
$22,245,434
22,875,569
24,202,163
23,905,493
25,091,003
Maximum
Annual
Debt Service)
$9,508,375
9,508,375
9,508,375
9,508,375
9,508,375
Debt
Service
Coverage
2.34
2.41
2.55
2.51
2.64
Source: City of Miami, Florida Finance Dept.
(1) Includes the First Levy and the Second Levy. The First Levy is scheduled to expire on August 31, 2023. In
Fiscal Year 2017, the First Levy produced $5,294,925 in revenues. Debt Service coverage in Fiscal Year 2017,
without taking into account the First Levy would have been 2.08.
(2) Maximum Annual Debt Service is based on existing debt service prior to the planned refunding.
Background
THE CITY OF MIAMI
Now 121 years old, the City is part of the nation's eighth largest metropolitan area. Incorporated
in 1896, the City is the only municipality conceived and founded by a woman - Julia Tuttle. According to
the U.S. Census Bureau, the City's population in 1900 was 1,700 people. The City is rich in cultural and
ethnic diversity with more than 467,872 residents as of 2017, according to the Bureau of Economic and
Business Research, University of Florida, 57.7% of them foreign born. In physical size, the City
encompasses 35.87 square miles. In population, the City is the largest of the 35 municipalities within the
County and is the County seat. For additional information concerning the City, see "APPENDIX A -
GENERAL INFORMATION REGARDING THE CITY OF MIAMI."
City Government
Since 1997, the City has been governed by a form of government known as the "Mayor -City
Commissioner Plan." The City Commission is the legislative body of the City. There are five
Commissioners elected from designated districts within the City. The Mayor is elected at large every four
years. As official head of the City, the Mayor has veto authority over actions of the City Commission.
The Mayor appoints the City Manager who functions as chief administrative officer.
The Mayor of the City is presently Francis X. Suarez whose term expires November 2021. The
current members of the City Commission and expiration of their current terms of office are:
City Commission Members Date Term Expires
Keon Hardemon, Chair
Ken Russell, Vice Chair
Joe Carollo, Commissioner
Wifredo (Willy) Gort, Commissioner
Manuel E. Reyes, Commissioner
30
November 2021
November 2019
November 2021
November 2019
November 2019
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The City Manager, Emilio T. Gonzalez, is a full-time employee and is the chief administrative
officer of the City. The City Manager is responsible for directing the administrative and operational
aspects of the City in compliance with the policies set by the City Commission and the Mayor. Mr.
Gonzalez became City Manager in January 2018 and has oversight of the Police, Communications and
Protocol, Fire Rescue, Equal Opportunity and Diversity Programs, Human Resources and Agenda
Coordination departments. Prior to working at the City, Mr. Gonzalez worked at Miami International
Airport for 4 years in various operational and administrative positions including Director. He is
responsible for an organization that has more than 4,300 employees and administers a budget of more
than $1 billion. Prior to his current position as City Manager, he served as a Homeland Security
undersecretary in charge of U.S. Customs and Immigration Services. He holds a doctorate in
International Relations from the University of Miami.
The City's Assistant City Manager and Chief Financial Officer is Sandra Bridgeman. Her
primary responsibilities include the oversight of the Finance, Grants Administration, Housing and
Community and Economic Development, General Services Administration, the Office of Management
and Budget, Procurement and Risk Management departments. She is also the City liaison with the
Firefighters' and Police Retirement Trust, the General Employees' and Sanitation Employees' Retirement
Trust and the Liberty City Trust. Prior to joining the City in May 2017, she served as Chief Financial
Officer of the Miami -Dade Aviation Department (MDAD). Among her various assignments during her
30 year career with the County, Ms. Bridgeman served as Controller for the Miami -Dade County Finance
Department, Controller for the Miami -Dade Aviation Department, and Finance Division Chief for the
Miami -Dade County Park and Recreation Department. Ms. Bridgeman is a certified public accountant
and holds a master's degree in accounting from Florida International University and a bachelor's degree
in accounting from Barry University. She sought and completed additional coursework in advanced
Mathematics and Information Systems at Brooklyn College in New York.
The City's Finance Director is Erica Paschal. She reports to the Assistant City Manager and
Chief Financial Officer. She is responsible for managing and investing public funds, accounts payable,
general ledger, grants monitoring, payroll, treasury management and preparation of routine accounting
reports as well as the City's annual financial statement. Ms. Paschal was appointed as the Finance
Director effective April 1, 2017. Prior to her current position as Finance Director, she served the City for
more than seventeen years in various financial services capacities, including Assistant Finance Director,
Fiscal Administrator of Solid Waste and Accountant Supervisor of Capital Improvement Programs. Ms.
Paschal is a graduate of the School of Business and Industry at Florida Agriculture and Mechanical
University, with a Bachelor's and Master's Degree in Business Administration. In October 2006, she met
all requirements in the State to be licensed as a Certified Public Accountant.
Adoption of Investment Policy and Debt Management Policy
The City adopted a detailed written Investment Policy on February 26, 2015, that applies to all
cash and investments held or controlled by the City and identified as "general operating funds" of the City
with the exception of the City's Pension Funds, Deferred Compensation & Section 401(a) Plans, and such
funds related to the issuance of debt where there are other existing policies or indentures in effect for such
funds. Additionally, any future revenues, which have statutory investment requirements conflicting with
the City's Investment Policy and funds held by state agencies (e.g. Department of Revenue), are not
subject to the provisions of the policy. The Investment Policy is available to the public on the City's
website at www.miamigov.com/Finance/pages/Financiallnfo/financiallnfo.asp.
The primary objective of the investment program is the safety of the principal of those funds
within the portfolios. Investment transactions will seek to keep capital losses at a minimum, whether they
are from securities defaults or erosion of market value. To attain this objective, diversification is required
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in order that potential losses on individual securities do not exceed the income generated from the
remainder of the portfolio. The portfolios are required to be managed in such a manner that funds are
available to meet reasonably anticipated cash flow requirements in an orderly manner. Return on
investment is of least importance compared to the safety and liquidity objectives described in the policy.
In accordance with the City's Administrative Policies, the responsibility for providing oversight and
direction in regard to the management of the investment program resides with the City's Finance Director
designee or investment advisor approved by the City Commission. The Finance Director, Treasurer and
the Investment Committee review the investment policy annually and the City Commission may approve
any modifications.
Subject to the exceptions in the City's investment policy, the City may invest in the following
types of securities: (a) The Florida Local Government Surplus Funds Trust Fund, (b) United States
Government Securities, (c) United States Government Agencies, (d) Federal Instrumentalities, (e) Interest
Bearing Time Deposit or Savings Accounts, (f) Repurchase Agreements, (g) Commercial Paper, (h)
Corporate Notes, (i) Municipal Securities, (j) Registered Investment Companies (Money Market Mutual
Funds) and (k) Intergovernmental Investment Pool (1) Agency Mortgage -Backed Securities, (m) Asset -
Backed Securities, (n) Supranationals and (o) Foreign Sovereign Governments.
As of September 30, 2017, approximately 25.72% of the City's investment portfolio was invested
in United States Treasury Obligations and obligations of agencies of the United States Government.
Approximately 29.99% of the City's investment portfolio was invested in commercial paper.
The City amended its Debt Management Policy on May 26, 2016 to provide guidance governing
the issuance, management, continuing evaluation of and reporting on all debt obligations issued by the
City and to provide for the preparation and implementation necessary to assure compliance and
conformity with the policy. The finance committee has approved the issuance of the Series 2018 Bonds
and the negotiated sale to the Underwriters. The Debt Management Policy is available to the public on
the City's website at www.miamigov.com/Finance/pages/Financiallnfo/financiallnfo.asp.
The following policies concerning the issuance and management of debt were established in the
Debt Management Policy: (a) the City will not issue debt obligations or use debt proceeds to finance
current operations; (b) the City will utilize debt obligations only for acquisition, construction or
remodeling of capital improvement projects that cannot be funded from current revenue sources or in
such cases wherein it is more equitable to the users of the projects to finance the project over its useful
life; and (c) the City will measure the impact of debt service requirements of outstanding and proposed
debt obligations on single year, five, ten and twenty year periods.
Capital Improvement Plan
The City's Multi -Year Capital Improvement Plan (the "Capital Plan"), adopted by the City
Commission on September 6, 2016 pursuant to Resolution Number 16-0393, covering the six -year period
from October 1, 2016 through September 30, 2022 earmarked funding estimated at $680.53 million for
878 (568 active and 310 future) projects throughout the City. Parks and recreation projects account for
the largest portion of the total Capital Plan funding at $211.39 million or 31.1%. Streets and sidewalks
projects are the second largest, accounting for $187.03 million, or 27.0%, and storm and sewer programs
are the third largest accounting for $79.65 million, or 11.7%, of the total Capital Plan.
Cash on hand, legally available for capital purposes represents the largest share of funding for the
Capital Plan, accounting for 69.7% of the total. Bonds issued by the City and state funding account for
11.2% and 6.4%, respectively, of the total. The remaining 12.6% of funding is from federal, County,
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other private donations. The Capital Plan is available to the public on the City's website at
www.miamigov.com/Budget/.
Fiscal and Accounting Procedures
The accounts of the City are organized on the basis of funds or account groups, each of which is
considered a separate accounting entity in accordance with generally accepted accounting principles, as
defined by the Governmental Accounting Standards Board ("GASB"). The operation of each fund is
accounted for in a separate, self -balancing set of accounts which comprise its assets and other debits,
liabilities, fund equities and other credits, revenues and expenditures. Individual funds that have similar
characteristics are combined into fund types. For a complete description of the fund types and account
groups, see "Notes to Basic Financial Statements of the City" in Appendix C herein.
Consistent with prior years, the City has received the Certificate of Achievement for Excellence
in Financial Reporting from the Government Finance Officers Association of the United States and
Canada.
Financial Information Relating to the City
In addition to the City's most recent audited financial statements attached hereto as Appendix C,
the current and prior Comprehensive Annual Financial Reports, Popular Annual Financial Reports, single
audit reports, auditors letters to management, monthly financial reports and other financial information
are available to the public on the City's website at www.miamigov.com/Finance/pages/Financiallnfo/
financiallnfo.asp. The prior, and current City budgets are available to the public on the City's website at
www.miamigov.com/Budget/. Any proposed or adopted budget is subject to change through the
amendment process of the City Commission. The inclusion in this Limited Offering Memorandum of
references to documents and information publicly available on the City's website is provided for
convenience only and is not intended to incorporate any such information into this Limited Offering
Memorandum. Information on the City's website, including financial statements, is for information
purposes only and all such information speaks only as of the date indicated in such documents or as of the
date posted, as applicable.
Indebtedness of the City
Pursuant to the Debt Management Policy, the City has established the following target debt
ratios: (i) debt service as a percentage of Non -Ad Valorem general fund revenues: less than or equal to
15%, (ii) Net Debt Per Capita: less than or equal to $2,000, and (iii) Net Debt to Taxable Assessed Value:
less than or equal to 5%. All debt obligations shall have a maximum maturity of the earlier of: (a) the
estimated useful life of the capital improvements being financed, or (b) thirty years, or (c) in the event
debt was issued to refinance outstanding debt obligations the final maturity of the debt obligations being
refinanced, unless a longer term is recommended by the finance committee. The City's Debt Policy is
available to the public on the City's website at www.miamigov.com/Finance/pages/Financiallnfo/
financiallnfo.asp.
Pension Fund
The City has three separate, single employer defined benefit plans under the administration and
management of separate Boards of Trustees. The City of Miami Fire Fighters' and Police Officers'
Retirement Trust ("FIPO") and the City of Miami General Employees' and Sanitation Employees'
Retirement Trust ("GESE") are contributory plans that cover substantially all of the City's employees
who contribute a percentage of their base salary or wage on a bi-weekly basis. The third plan is a non-
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contributory defined benefit plan, the City of Miami Elected Officers' Retirement Trust ("EORT"), in
which all elected officials with seven or more years of elected service, elected to office prior to October
22, 2009 were eligible for participation. The EORT was closed to new elected official members as of
October 22, 2009.
City employees are required to contribute 10% of their salary to GESE and FIPO, as applicable.
The EORT is a non-contributory plan. Contributions from employees for FIPO and GESE are recorded in
the period the City makes payroll deductions from participants. The City is annually required to
contribute such amounts as necessary on an actuarial basis to provide FIPO and GESE with assets
sufficient to meet the benefits to be paid. For the year ended September 30, 2017, the City's contribution
for FIPO and GESE was 37.64% and 40.56% of annual payroll, respectively. The ordinance covering the
FIPO (the "Pension Ordinance") provides for actuarial methodology for evaluating assets to be a moving
market value averaged over three years. The result cannot be greater than 100 percent of market value or
less than 80 percent of market value. The Pension Ordinance also provides for the FIPO Board of
Trustees' actuary to use the actuarial assumptions adopted the FIPO Board. Currently, the City and the
FIPO are in discussions regarding the amount needed for contribution. However, if the City's actuary and
the FIPO's actuary cannot agree, together they may appoint a third independent actuary. The third
actuary is required to submit a funding recommendation to the FIPO Board and the City Commission.
The City Commission is then required to fund the amount recommended by either the FIPO' s actuary or
the City's actuary, whichever recommendation is closer to the recommendation of the third actuary.
The City's net pension liability for each of the FIPO, the GESE and the EORT was $632,752,065,
$264,090,507 and $1,591,781, respectively, as of September 30, 2017. The annual pension costs have
been fully contributed by the City for the fiscal years ended September 30, 2010, 2011, 2012, 2013, 2014,
2015, 2016 and 2017. See "APPENDIX C BASIC FINANCIAL STATEMENTS OF THE CITY OF
MIAMI FOR FISCAL YEAR ENDED SEPTEMBER 30, 2017 (Excerpt of the City of Miami
Comprehensive Annual Financial Report) — NOTE 10. PENSIONS."
Additionally, the City has established a qualified governmental excess benefit plan to continue to
cover the difference between the allowable pension to be paid and the amount of the defined benefits, so
the benefits for eligible members are not diminished by the changes in the Internal Revenue Code (the
GESE "Excess Plan"). Plan members are not required to contribute to the GESE Excess Plan. The
payment of the City's contribution of the excess retirement benefit is funded from the City's General
Fund and paid annually at the same time as the City's annual contribution to normal pension costs. The
EBP is an unfunded plan and the City is required to contribute as benefits become payable. The payroll
for employees covered by the GESE Excess Plan for the year ended September 30, 2017 was
approximately $81 million The City's contribution to the plan for the year ended September 30, 2017
was $680,534 and plan benefit payments were $680,534. The City is required to contribute the difference
between the actuarially determined rate and the contribution rate of employees. For the year ended
September 30, 2017, the City's average contribution rate was 1 percent of annual payroll.
The separate Annual Report for FIPO is available to the public on FIPO's website at
www.miamifipo.com/resources/. The separate Annual Report for GESE is available to the public on
GESE's website at www.gese.org/ARframe.htm. Separate stand-alone financial statements are not issued
for EORT and are presented as part of the Combining Statement of Fiduciary Net Position and
Combining Statement of Changes in Fiduciary Net Position located in the Fiduciary Funds section of the
City's Comprehensive Annual Financial Report ("CAFR") available to the public on the City's website at
www.miamigov.com/Finance/page s/Financiallnfo/financiallnfo. asp.
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Accrued Compensated Absences
Under terms of Civil Service regulations, labor contracts and administrative policy, City
employees are granted vacation and sick leave in varying amounts. Additionally, certain overtime hours
can be accrued and carried forward as earned time off. Unused vacation and sick time is payable upon
separation from service, subject to various limitations depending upon the employee's seniority and civil
service classification. The amount accrued as of September 30, 2017 is $40,082,783 of which $9,932,465
is the current portion. The maximum number of hours which can be carried forward may be renegotiated
with FIPO and GESE at each negotiation period.
Union Labor Agreements
The labor agreement between the City and Fraternal Order of Police, Walter E. Headley, Jr.,
Miami Lodge No. 20 was renegotiated in 2016 for a term of 3 years and will expire on September 30,
2018 (the "FOP Agreement"). The FOP Agreement covers 1,284 positions. The renegotiated FOP
Agreement had a fiscal impact of $8.88 million in FY 2015-16, an additional budgeted impact of $4.78
million in fiscal year FY 2016-17, and will have an additional estimated impact of $3.94 million in fiscal
year 2017-18. [Confirm and update]
The labor agreement between the City and International Association of Firefighters, AFL-CIO
Local 587 expired on September 30, 2016 and is currently in the final stages of negotiations. The contract
covers 739 positions. [Provide the current status of the IAF Contract]
The City will soon begin negotiations with the General Union (Miami General Employees
American Federation of State, County, and Municipal Employees Local 1907, AFL-CIO). The contract
will expire on September 30, 2017 and covers 1,516 positions. [Provide the current status of the General
Employees Contract]
The City will soon begin negotiations with the Sanitation Union (Florida Public Employees
Council 79, American Federation of State, County, and Municipal Employees, AFL-CIO, Local 871).
The contract will expire on September 30, 2017 and covers 210 positions. [Provide the current status of
the Sanitation Employees Contract]
Other Postemployment Benefits ("OPEB")
Pursuant to Section 112.0801 of the Florida Statutes, the City is required to permit participation
in the health insurance program by retirees and their eligible dependents at a cost to the retiree that is no
greater than the cost at which coverage is available for active employees. The City has two separate
single -employer OPEB plans for its retirees. One plan is for retiring police officers and the other plan is
for all other retiring employees (the "Non -Police Retirees"). Retired police officers are offered coverage
at a discounted premium. For Non -Police retirees (Fire Fighters, General Employees, Sanitation
Employees and Elected Officials) and their dependents, the City has a stated policy of providing health
coverage and life insurance at a discounted premium equal to the blended group rate. Non -Police
Retirees receive the same benefits as similarly situated active employees of the City, while retired police
officers receive the same benefits as provided through the Fraternal Order of Police Health Trust. The
benefits afforded to all retirees include lifetime medical, prescription, vision, dental and certain life
insurance coverage for retiree and dependents. Substantially all of the City's general employees,
sanitation employees and firefighters may become eligible for these benefits when they reach normal
retirement age while working for the City.
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As of October 1, 2016, the most recent actuarial valuation date, there are approximately 5,389
covered participants of whom approximately 3,640 are active employees and 1,749 retirees.
The City is authorized to establish benefit levels and approve the actuarial assumptions used in
the determination of contributions levels. Retirees, and the spouses and other dependents of retirees
contribute the majority of their premium costs each month. Currently, the City's subsidy to OPEB
benefits is unfunded. There are no separate trust funds or equivalent arrangements into which the City
makes contributions to advance -fund the OPEB obligations, as it does for its retiree pension plans. The
City's cost of the OPEB benefits is funded on a pay-as-you-go basis. The City contributed $12 7 million
for the fiscal year ended September 30, 2017.
As noted in Note 11 of the Notes to Basic Financial Statements of the City, attached to the City's
CAFR, attached hereto as Exhibit C, the City's annual OPEB cost and the net OPEB obligation for the
fiscal year ended September 30, 2017 for both Police and Non -Police retirees are as follows:
Police Retirees
Annual required contribution $ 62,398,000
Interest on net OPEB obligation 5,724,000
Adjustment to annual required contribution (11,106,000)
Annual OPEB cost (expense) 57,016,000
Contributions made 9,196,000
Increase in net OPEB obligation 47,820,000
Net OPEB obligation - beginning of year 286,212,000
Net OPEB obligation - end of year $ 334,032,000
Non -Police
Retirees
$ 28,248,000
1,995,000
(3,142,000)
27,101,000
3,551,000
23,550,000
99,743,000
$123,293,000
Total
$ 90,646,000
7,719,000
(14,248,000)
84,117,000
12,747,000
71,370,000
385,955,000
$457,325,000
As noted in Note 11 of the Notes to Basic Financial Statements of the City, attached to the City's
CAFR, attached hereto as Exhibit C, The City's annual OPEB cost, net OPEB obligations, and percentage
of annual OPEB cost contributed, are as follows:
Year Ended
September 30,
2017
2016
2015
Year Ended
September 30,
2017
2016
2015
Annual
OPEB Cost
$57,016,000
54,724,000
54,814,000
Annual
OPEB Cost
$27,101,000
26,141,000
18,451,000
Police
OPEB
Contributions
$9,196,000
8,245,000
8,655,000
Non -Police
OPEB
Contributions
$3,551,000
3,551,000
3,547,000
36
Percentage of
Annual OPEB
Cost Contributed
16%
15
16
Percentage of
Annual OPEB
Cost Contributed
13%
14
19
Net OPEB
Obligations
$334,032,000
286,212,000
239,733,000
Net OPEB
Obligations
$123,293,000
99,743,000
77,153,000
010-8616-7788/4/AM ERICAS
As noted in Note 11 of the Notes to Basic Financial Statements of the City, attached to the City's
CAFR, attached hereto as Exhibit C, as of October 1, 2016, the most recent actuarial valuation date, the
funded status of the Police and Non -Police Retirees OPEB plan was as follows:
Actuarial
Valuation of
Assets
(a)
Non -Police $
Police
Total $
Actuarial Unfunded
Accrued Actuarial Accrued
Liability Liability (UAAL)
(b) (b-a)
$277,419,000 $277,419,000
717,602,000 717,602,000
$ 995,021,000 $995,021,000
Non -Police Police
Covered Payroll $212,363,106 $83,439,609
UAAL as a percentage of Payroll
130.6% 860.0%
Fund Ratio
(a/b)
0.00%
0.00
0.00
See "APPENDIX C BASIC FINANCIAL STATEMENTS OF THE CITY OF MIAMI FOR
FISCAL YEAR ENDED SEPTEMBER 30, 2017 (Excerpt of the City of Miami Comprehensive Annual
Financial Report) — NOTE 11. POST EMPLOYMENT HEALTH CARE BENEFITS."
Implementation of Recent GASB Statements Regarding Pensions
In 2015, the City implemented GASB Statement No. 68, Accounting and Financial Reporting for
Pensions — An Amendment of GASB Statement No. 27 (GASB 68). In addition, the City implemented
GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement
Date — An Amendment of GASB Statement No. 68, which addresses an issue regarding application of the
transition provisions of GASB 68. GASB Statement Nos. 68 and 71 require the employer to report the
employer's net pension liability and related pension amounts of the defined benefit pension plans at fiscal
year-end.
As noted in Note 10 of the Notes to Basic Financial Statements of the City, attached to the City's
CAFR, attached hereto as Exhibit C, as of October 1, 2017, the City's net pension liability, deferred
inflow and outflow of resources are as follows:
Plan
FIPO
GESE Trust
GESE Excess Benefit
GESE Staff Trust
EORT
Total
Net Pension Deferred Inflow
Liability of Resources
$632,752,065
264,090,507
13,481,890
899,508
1,591,781
$912,815,751
$ 10,698,190
5,099,413
412,282
457,362
$ 16,667,247
Deferred Outflow
of Resources
$ 57,489,131
45,681,841
4,005,709
334,645
759,644
$108,270,970
As of September 30, 2015, the implementation of GASB Statement Nos. 68 and 71 resulted in the
City recording deferred outflows of $32.1 million, deferred inflows of $11 8 million, and a net pension
liability of $706.4 million As of September 30, 2017, the City recorded deferred outflows of $108.3
million, deferred inflows of $16.7 million, and a net pension liability of $912.8 million
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See "APPENDIX C - BASIC FINANCIAL STATEMENTS OF THE CITY OF MIAMI FOR
FISCAL YEAR ENDED SEPTEMBER 30, 2017 (Excerpt of the City of Miami Comprehensive Annual
Financial Report) — NOTE 10. PENSIONS" for additional information regarding the Pension Plans and
see the Required Supplementary Information following the notes to the financial statements, for
schedules of changes in the net pension liability and related ratios and the schedules of contributions
and additional information about the net pension liability, plan assets and contributions for each of the
City's defined benefit pension plans.
Financial Urgency
Pursuant to Section 447.4095 of the Florida Statutes, the City may declare a financial urgency.
That statute, which requires declaration each year, provides that, in the event of a financial urgency
requiring modification of a collective bargaining agreement, the City and the representative of the
bargaining unit are required to meet as soon as possible to negotiate the impact of the financial urgency.
If after a reasonable period which may not exceed 14 days the parties are in disagreement, then they must
proceed under Section 447.403 of the Florida Statutes, which provides for the appointment of a mediator.
The City Manager declared a financial urgency in calendar years 2010, 2011 and 2012 for fiscal years
2011, 2012 and 2013, respectively.
Pursuant to the statute and under the City's authority, in 2010 it imposed the following changes
on the unions:
• There was a tiered reduction in wages ranging from 0% for salaries less than $39,999.99 to
12% for salaries greater than $120,000 that applied to members of the International
Association of Firefighters, AFL-CIO, Local 587, Fraternal Order of Police, Walter E.
Headley, Jr., Miami, Miami Lodge No. 20 and Miami General Employees, American
Federation of State, County and Municipal Employees, Local 1907, AFL-CIO.
• There was also a freezing of step and longevity pay.
• Modification to supplemental pay items, which included elimination of education pay
supplements, among other things.
• Changes to the healthcare plan, such as increasing the co -pays for primary and specialist care
physician visits, adding a deductible for the healthcare plan, adding an out-of-pocket
maximum, lowering the coinsurance, increasing co -pays for prescriptions, increasing
emergency room co -pays and adding a co -pay for urgent care facilities.
• Modifying the pension benefits by increasing the normal retirement date, changing the benefit
formula, changing the maximum benefit, changing the average final compensation.
Additionally, for the members of the Florida Public Employees' Council 79, AFSCME, AFL-
CIO, Local 871, effective on October 1, 2010, member contributions will be made at the rate
of 13%.
The impact of these changes on the General Fund was $76,943,905 for fiscal year 2011 in
savings. [Confirm] The financial urgency was challenged in 2010. See "LITIGATION - Fraternal Order
of Police, Walter E. Headley, Jr., Miami Lodge No. 20 v. City of Miami" herein regarding certain legal
actions brought in connection therewith.
Although Financial Urgency was declared in 2011 and 2012, the City was able to negotiate a one-
year contract in 2011 (no modifications were imposed) and a two-year contract in 2012 with the unions.
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In 2012, the City was able to reach agreements with the unions which included, among other things,
changes to the pension plans. There may be a legal requirement that certain terms in the pension
agreements which were modified in 2012 be approved by the Circuit Court. However, the City does not
expect this to be an issue because all parties have jointly agreed to petition the Court for those terms, if
legally necessary. See "PENSION PLANS AND OTHER POST -EMPLOYMENT BENEFITS" herein.
Impact of the Zika Virus
In February 2016, Florida Governor Rick Scott declared a public health emergency relating to
travel -related and locally contracted cases of the mosquito -borne Zika virus in the State, and particularly
in the County and the City. Outbreaks of the Zika virus caused the issuance of travel alerts to persons
visiting the Caribbean, Central and South America and parts of the State. Advisories were issued for
people living in or traveling to Wynwood and Little River, two neighborhoods in the City, and sections of
Miami Beach, Florida. During the period of active transmissions the CDC advised pregnant women not
to travel to all parts of the County and advised pregnant women and their partners to consider postponing
nonessential travel to all parts of the County. During the period of active Zika transmission, businesses in
the Wynwood and Miami Beach areas experienced significant decreases in revenue as a result of the Zika
outbreak and travel advisories. The County took significant, proactive efforts, including, but not limited
to, repeated aerial applications of insecticide to reduce mosquito populations to prevent additional locally
transmitted cases of Zika during and after the period of active Zika transmission. As of April 2018,
according to the Florida Department of Health, there were a total of 26 travel related cases, zero locally
acquired cases and 18 cases involving pregnant women in the State compared to December 2016 when
there were 980 travel related cases, 249 locally acquired cases and 185 cases involving pregnant women
pregnant women in the State. On December 9, 2016, Florida Governor Rick Scott declared the State was
Zika-free after the fmal area in Miami Beach completed 45 days with no new transmissions.
Because Zika is a mosquito -borne virus and transmission is facilitated by travel into the State, it
is impossible to predict whether the State will experience another outbreak. The outbreak of Zika and
other infectious diseases in the future and the issuance of travel alerts could have an adverse effect on
tourism in the City and the County. A reduction in travel to South Florida could affect key sources of tax
revenue linked to tourism, including sales, gas and tourist development taxes.
Zika research, prevention and response has been funded at both the State and Federal levels. On
September 27, 2016, Congress agreed to allocate $1.1 billion to help fight the spread and effects of the
Zika virus. During the 2018 Florida Legislative session, approximately $15 million was earmarked for
Zika research.
The financial effect of the 2016 Zika virus outbreaks on the City was not significant and
collections on Designated Revenues were not significantly affected. The City cannot predict at this time
the effect a future Zika virus outbreak could have on the City, including the effect on future collections of
Designated Revenues.
Impact of Hurricane Irma
On September 10, 2017, the State of Florida was impacted by Hurricane Irma. At approximately
9:00 a.m., the center of Hurricane Irma made landfall at Cudjoe Key in the lower Florida Keys as a
Category 4 storm, according to the National Weather Service. The center of Hurricane Irma made a
second landfall as a Category 3 storm, at approximately 3:30 p.m., near Marco Island, which is located
approximately 100 miles north-northwest of the County. Most of the County recorded sustained winds of
strong tropical storm force (58-73 mph) and some areas likely experienced sustained winds of just below
hurricane strength (75 mph). Almost all of the County experienced peak wind gusts of Category 1
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strength (80-95 mph). The County received approximately 4-8 inches of rain in the local area in a 48-hour
period and experienced approximately 3-5 feet of inundation as a result of storm surge. As expected, due
to the winds, rain and local area flooding, electric service and other outages were experienced.
During Hurricane Irma, the City did not experience significant damage to property or
infrastructure. Current estimates for repairs, replacements, mitigation, and resiliency efforts at the City's
facilities are estimated at $34,193,228. The City has sufficient disaster recovery and cleanup reserves;
insurance policies and coverages to manage such costs without impact to its budget and plans to recoup a
majority of its costs through FEMA and state reimbursements.
Legislative Matters Affecting the City
During the 2018 Florida Legislative session, the Florida Legislature enacted a law amending
Florida Statute 112.1815, and thereby adding that (i) posttraumatic stress disorder ("PTSD") suffered by a
first responder during the course of employment to be an occupational disease compensable by workers'
compensation benefits; (ii) PTSD must be demonstrated by clear and convincing evidence; (iii) benefits
do not require a physical injury to the first responder and are not subject to apportionment due to pre-
existing PTSD or limitations. Pursuant the City's Ordinance, the City is unable to offset workers'
compensation benefits against the pension benefits. Qualified first responder employees may be eligible
for both workers' compensation benefits and pension benefits, which may have a financial impact on the
City and pension benefits. [Confirm]
Proposed Constitutional Amendments Affecting the City
Once every 20 years, Florida's Constitution provides for the creation of a 37-member revision
commission for the purpose of reviewing Florida's Constitution and proposing changes for voter
consideration. The Constitution Revision Commission ("CRC") meets for approximately one year,
traveling throughout the State, identifying issues, performing research and possibly recommending
changes to the Florida Constitution. The 2017-2018 CRC adjourned on May 11, 2018, and placed eight
proposed constitutional amendments on the General Election ballot for voter consideration. At least sixty
percent of the vote is required to pass a constitutional amendment in the State.
The CRC proposed an amendment to the Florida Constitution which would add a new section to
the Constitution to grant mandatory payment of death benefits and waiver of certain educational expenses
to qualifying survivors of certain first responders and military members who die performing official
duties. If approved by voters, the employing agencies of certain first responders and military members,
including, but not limited to firefighters, law enforcement, correctional officers would be required to pay
benefits to qualifying survivors; the State would be responsible for waiving certain educational expenses
of the surviving child or spouse. Although the proposal, if approved, would require the City to pay death
benefits for a first responder employee killed while performing official duties, the City does not expect
this to impact its ability to pay debt service on the Series 2018 Bonds. [Confirm]
The CRC proposed an amendment to the Florida Constitution to end the racing of, and wagering
on, greyhound and other dogs and within the State by 2020. There are approximately 12 tracks in the
State, one of which is located in the City. If approved, the City would no longer collect a tax on
greyhound racing in the City. The City does not expect that the proposal, if approved by the voters, will
have an impact on the collections of Designated Revenues or its ability to pay debt service on the Series
2018 Bonds. [Does the City receive any revenue related to dog racing?] . [Confirm]
During the 2017 Florida Legislative session, which concluded on May 8, 2017, the Florida
Legislature passed House Joint Resolution 21, which proposes an amendment to Section 27, Article X11
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of the Florida Constitution that if approved, would permanently retain paragraph 4. under
"LEGISLATIVE AND CONSTITUTIONAL INITIATIVES CONCERNING AD VALOREM TAXES —
Constitutional Amendments related to ad valorem exemptions." herein, which caps property tax increases
on specified non -homestead real property, except school district taxes, to 10 percent each year.
During the 2017 Florida legislative session, which concluded on May 8, 2017, the Florida
Legislature passed House Joint Resolution 7105, which proposes an amendment to Section 6, Article VII
of the Florida Constitution that would increase the homestead exemption by exempting the assessed
valuation of homestead property greater than $100,000 and up to $125,000 for all levies other than school
district levies. If approved by the voters in November 2018, such amendment would be effective
beginning with the 2019 tax roll. The City estimates that this amendment would result in a negative
revenue impact to the City of approximately $ annually. However, the City does not believe
that the impact will adversely affect the City's ability to pay debt service on the Series 2018 Bonds.
[Confirm]
During the 2018 Florida Legislative session, the Florida Legislature passed House Joint
Resolution 7001 ("HJR 7001") proposing an amendment to the Florida Constitution providing that no
state tax or fee may be imposed, authorized, raised by the Florida Legislature, or authorized by the Florida
Legislature to be raised except through legislation requiring a two-thirds vote of each house of the
Florida Legislature. The same requirement would apply to decreasing or eliminating any state tax, fee
exemption or credit. Currently, such tax and fee changes require a simple majority vote. HJR 7001 also
requires that any proposed state tax or fee imposition, authorization or increase must be contained in a
separate bill that contains no other subject. The joint resolution specifies that the proposed amendment
does not authorize the imposition of any state tax or fee otherwise prohibited by the Florida Constitution,
and does not apply to any tax or fee imposed by, or authorized to be imposed by, a county, municipality,
school board, or special district. The amendment proposed in HJR 7001 was passed and signed into law
by Governor Scott and will take effect on January 8, 2019, if approved by sixty percent of the voters
during the 2018 general election or earlier special election. Although the proposal would not subject local
taxes and fees to the stricter voting requirement, local governments could be adversely impacted during
recessionary economic environments if State lawmakers are unable to raise taxes. The City does not
expect that HJR 7001, if approved by the voters, will have an impact on the collections of Designated
Revenues or its ability to pay debt service on the Series 2018 Bonds. [Confirm]
LEGISLATIVE AND CONSTITUTIONAL INITIATIVES
CONCERNING AD VALOREM TAXES
Several amendments to the Florida Constitution affecting ad valorem taxes have been approved
by voters in the past including the following:
Save Our Homes Amendment. By voter referendum held on November 3, 1992, Article VII,
Section 4 of the Florida Constitution was amended by adding thereto a subsection which, in effect, limits
the increases in assessed just value of homestead property to the lesser of (a) 3% of the assessment for
the prior year or (b) the percentage change in the Consumer Price Index for all urban consumers, U.S.
City Average, All Items 1967=100, or successor reports for the preceding calendar year as initially
reported by the United States Department of Labor, Bureau of Labor Statistics (the "Save Our Homes
Amendment"). Further, the Save Our Homes Amendment provides that (1) no assessment shall exceed
just value, (2) after any change of ownership of homestead property or upon termination of homestead
status, such property shall be reassessed at just value as of January 1 of the year following the year of
sale or change of status, (3) new homestead property shall be assessed at just value as of January 1 of the
year following the establishment of the homestead, and (4) changes, additions, reductions or
improvements to homestead property shall initially be assessed as provided for by general law, and
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thereafter as provided in the Save Our Homes Amendment. The effective date of the Save Our Homes
Amendment was January 5, 1993, and the base year for determining compliance with the restrictions
was 1994. The 1995 tax roll year was the first year such limitations were effective.
Millage Rollback Legislation. In 2007, the Florida Legislature adopted Chapter 2007-321, Laws
of Florida, a property tax plan which significantly impacted ad valorem tax collections for State local
governments. One component of the adopted legislation required counties, cities and special districts to
rollback their millage rates for the 2007-2008 fiscal year to a level that, with certain adjustments and
exceptions, would generate the same level of ad valorem tax revenue as in fiscal year 2006-2007;
provided, however, depending upon the relative growth of each local government's own ad valorem tax
revenues from 2001 to 2006, such rolled back millage rates were determined after first reducing 2006-
2007 ad valorem tax revenues by zero to nine percent (0% to 9%). In addition, the legislation limited the
maximum millage for future years. A local government governing body may increase ad valorem tax
levies by extraordinary votes or by referenda. A local government may override certain portions of these
requirements by a supermajority, and for certain requirements, by a unanimous vote of its governing
body. Any county or municipality that levies in excess of the amount permitted under the legislation will
forfeit participation in the half -cent sales tax revenue sharing program for a twelve month period.
Constitutional amendments related to ad valorem exemptions. On January 29, 2008, in a special
election held for such purpose, the requisite number of voters approved amendments to the State
Constitution exempting certain portions of a property's assessed value from taxation. The following is a
brief summary of certain important provisions contained in such amendments:
1. Provides for an additional exemption for the assessed value of homestead property
between $50,000 and $75,000, thus doubling the existing homestead exemption for property with an
assessed value equal to or greater than $75,000.
2. Permits owners of homestead property to transfer their "Save Our Homes" benefit (up to
$500,000) to a new homestead property purchased within two years of the sale of their previous
homestead property to which such benefit applied if the just value of the new homestead is greater than or
is equal to the just value of the prior homestead. If the just value of the new homestead is less than the
just value of the prior homestead, then owners of homestead property may transfer a proportional amount
of their "Save Our Homes" benefit, such proportional amount equaling the just value of the new
homestead divided by the just value of the prior homestead multiplied by the assessed value of the prior
homestead.
3. Exempts from ad valorem taxation $25,000 of the assessed value of property subject to
tangible personal property tax.
4. Limits increases in the assessed value of non -homestead property to 10% per year,
subject to certain adjustments. The cap on increases would be in effect for a 10 year period, subject to
extension by an affirmative vote of electors.
These amendments were effective for the 2008 tax year (fiscal year 2008-2009 for local
governments).
Plaintiffs in several instances have challenged the constitutionality of the Save Our Homes
Amendment assessment cap and the portability provision, as in Lanning v. Pilcher in October 2007,
Bruner v. Hartsfield in November 2007 and DeLuccio v. Havill in May 2008, each filed in the Circuit
Court in and for Leon County, Florida. In each case, the higher court denied the plaintiffs' petitions and
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upheld the constitutionality of such provisions; however, there is no assurance that any future challenges
to such provisions will not be successful.
In the November 2008 General Election, voters approved the following three amendments to (i)
allow the Florida Legislature, by general law, to exempt from assessed value of residential homes,
improvements made to protect property from wind damage and installation of a new renewable energy
source device; (ii) assess specified working waterfront properties based on current use rather than highest
and best use; (iii) provide a property tax exemption for (a) real property that is perpetually used for
conservation (began in 2010); and, (b) land not perpetually encumbered, require the Florida Legislature to
provide classification and assessment of land use for conservation purposes solely on the basis of
character or use.
Exemption for Deployed Military Personnel. In the November 2010 General Election voters
approved a constitutional amendment which provides an additional homestead exemption for deployed
military personnel. The exemption equals the percentage of days during the prior calendar year that the
military homeowner was deployed outside of the United States in support of military operations
designated by the Florida Legislature. This constitutional amendment took effect on January 1, 2011. In
the Florida Legislature's 2016 legislative session, lawmakers passed House Bill 7023, which expanded
the categories of military operations by adding 11 new eligible designations.
Exemptions for Disabled Veterans, Surviving Spouses and First Responders. During the Florida
Legislature's 2011 Regular Session, it passed Senate Joint Resolution 592 ("SJR 592"). SJR 592 allows
totally or partially disabled veterans who were not Florida residents at the time of entering military
service to qualify for the combat -related disabled veteran's ad valorem tax discount on homestead
property. HJR 592 took effect June 13, 2011.
During the Florida Legislature's 2012 Regular Session, it passed House Joint Resolution 93
("HJR 93"). HJR 93 allows the Florida Legislature to provide ad valorem tax relief to the surviving
spouse of a veteran who died from service -connected causes while on active duty as a member of the
United States Armed Forces and to the surviving spouse of a first responder who died in the line of duty.
The amount of tax relief, to be defined by general law, can equal the total amount or a portion of the ad
valorem tax otherwise owed on the homestead property. HJR 93 took effect January 1, 2013.
During the Florida Legislature's 2016 Regular Session, it passed House Joint Resolution 1009,
proposing an amendment to the Florida Constitution to grant full or partial property tax exemption on
homestead property to first responders who are totally and permanently disabled as a result of an injury or
injuries sustained in the line of duty. The amendment was approved by voter referendum in the November
2016 general election. The amendment will take effect on January 1, 2017.
Exemptions for Seniors. Also during the Florida Legislature's 2012 Regular Session, it passed
House Joint Resolution 169 ("HJR 169") which became HB No. 357, codified as 2012-57 and amending
Section 196.075, Florida Statutes. The amendment allows the Florida Legislature by general law to permit
counties and municipalities, by ordinance, to grant an additional homestead tax exemption (the "Additional
Homestead Exemption") equal to the assessed value of homestead property to certain low income seniors.
To be eligible for the Additional Homestead Exemption the county or municipality must have granted the
exemption by ordinance; the property must have a just value of less than $250,000; the owner must have
title to the property and maintained his or her permanent residence thereon for at least 25 years; the owner
must be age 65 years or older; and the owner's annual household income must be less than $20,000,
adjusted annually based on the Consumer Price Index, which for 2015 was $28,448. The Additional
Homestead Exemption authorized by HJR 169 would not apply to school property taxes. In order to grant
the Additional Homestead Exemption, the City enacted Ordinance No. 2012-34.
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During the Florida Legislature's 2016 Regular Session, it passed House Joint Resolution 275
("HJR 275") which became HB No. 277, amending Section 196.075, Florida Statutes, to allow certain low
income seniors to continue receiving the Additional Homestead Exemption if the homestead's just value
rises above $250,000 either due to changes in the market or because of additions or improvements made to
the property. In addition, individuals who were granted the Additional Homestead Exemption in prior
years, but became ineligible for the Additional Homestead Exemption because the just value of the
individual's homestead rose above $250,000, may regain the Additional Homestead Exemption by
reapplying. The just value determination for such person will be the just value as determined in the first
tax year that the owner applied for and was eligible for the Additional Homestead Exemption, regardless of
the current just value of his or her homestead property. The amendment was approved by voter
referendum at the November 8, 2016 general election. The amendment took effect on January 1, 2017 and
will apply retroactively to the 2013 tax roll for any person who received the exemption under Section
196.075(2)(b) before the January 1, 2017 effective date.
Other Exemptions Affecting Ad Valorem Taxation. During the Florida Legislature's 2013
Regular Session, it passed Senate Bill 1830 ("SB 1830"), which was signed into law by the Governor and
created a number of changes affecting ad valorem taxation. First, SB 1830 provides long-term lessees the
ability to retain their homestead exemption and related assessment limitations and exemptions in certain
instances. Second, SB 1830 inserts the term "algaculture" in the definition of "agricultural purpose" and
inserts the terms "aquacultural crops" in the provision specifying the valuation of certain annual
agricultural crops, nonbearing fruit trees and nursery stock. Third, SB 1830 allows for an automatic
renewal for assessment reductions related to certain additions to homestead properties used as living
quarters for a parent or grandparent and aligns related appeal and penalty provisions to those for other
homestead exemptions. Fourth, SB 1830 deletes a statutory requirement that the owner of the property
must reside upon the property to qualify for a homestead exemption. Fifth, SB 1830 clarifies the property
tax exemptions counties and cities may provide for certain low income persons age 65 and older. Sixth,
SB 1830 removes a residency requirement that a senior disabled veteran must have been a Florida
resident at the time they entered the service to qualify for certain property tax exemptions. Seventh, SB
1830 repeals the ability for certain limited liability partnerships to qualify for the affordable housing
property tax exemption. Eighth, SB 1830 exempts property used exclusively for educational purposes
when the entities that own the property and the educational facility are owned by the same natural
persons.
Also during the Florida Legislature's 2013 Regular Session, the Florida Legislature passed House
Bill 277 ("HB 277"), which was signed into law by the Governor. HB 277 provides that certain
renewable energy devices are exempt from being considered when calculating the assessed value of
residential property. HB 277 only applies to devices installed on or after January 1, 2013. HB 277 took
effect on July 1, 2013. The 2016 Florida Legislature passed House Joint Resolution 193, which proposed
an amendment to the Florida Constitution to expand the existing renewable energy devices exemption for
residential property to commercial and industrial properties. In the August 30, 2016 special election,
voters approved the amendment to authorize the Florida Legislature, by general law, to exempt from ad
valorem taxation the assessed value of solar or renewable energy source devices subject to tangible
personal property tax, and to authorize the Florida Legislature, by general law, to prohibit consideration
of such devices in assessing the value of real property for ad valorem taxation purposes.
In the August 2016 general election, voters failed to pass a constitutional amendment to allow
consumers to own or lease solar equipment installed on their property to generate electricity for their own
use. State and local governments would retain their abilities to protect consumer rights and public health,
safety and welfare, and to ensure that consumers who do not choose to install solar are not required to
subsidize the costs of backup power and electric grid access to those who do.
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At this time, it is impossible to tell whether in the future there may be future property tax
amendments or estimate with any certainty the level of impact that the constitutional amendments will
have on the City, but the impact could be substantial.
FEDERAL COURT ORDER AND INJUNCTION, CEASE AND DESIST ORDER OF THE
SECURITIES AND EXCHANGE COMMISSION AND OTHER DISCLOSURE RELATED
SECURITIES AND EXCHANGE COMMISSION INVESTIGATIONS
Overview
The City and its officials and employees are subject to a 2016 federal court order and injunction
and a 2003 cease and desist order of the Securities and Exchange Commission ("SEC") from future
violations of the antifraud provisions of federal securities law in the City's disclosures relating to its
bonds, as described below. An investigation in connection with the City's 2010 bond offering financing a
portion of the Marlins Stadium, was concluded in February 2016 with no charges being filed.
The 2016 Final Judgment and Order
The Final Judgment and Order. On October 27, 2016, Judge Cecilia M. Altonaga of the U.S.
District Court for the Southern District of Florida issued a Final Judgment following a trial before the
court and a jury in Securities and Exchange Commission v. City of Miami, et al. Case No. 13-22600-CIV-
Altonaga/O' Sullivan ("Final Judgment"). The Final Judgment permanently enjoins the City, as well as
any of the City's officers, agents, servants, employees, and attorneys, and other persons in active concert
receiving actual notice of the Final Judgment, as well as other persons in active concert or participation
with the City or its officers, employees and others previously mentioned, from (a) violating section 17(a)
of the Securities Act and (b) section 10(b) of the Exchange Act and Rule 10b-5 thereunder (the "antifraud
provisions") by directly or indirectly (1) creating a false appearance or otherwise deceiving any person
about the credit rating, value, or price of any municipal bond; (2) making any false or misleading
statement, or disseminating any false or misleading documents, materials, bond offering documents, or
comprehensive annual financial reports to the public, including but not limited to any rating agency; or
(3) making any false or misleading statement, or disseminating any false or misleading documents,
concerning matters relating to a decision by an investor or prospective investor to buy or sell municipal
bonds.
The Final Judgment also holds that the City violated the outstanding Cease and Desist Order of
the SEC, In re the City of Miami, Florida, Securities Act Release No. 8213, Exchange Act Release No.
47552, Administrative Proceeding File No. 3-10022 (March 21, 2003) (the "2003 Cease and Desist
Order") described below, upon holding the City violated the 2003 Cease and Desist Order.
The Final Judgment also ordered the City to pay a one million ($1,000,000) dollar civil penalty,
which amount was agreed to by both the City and the SEC.
The Court retains jurisdiction over the case for the purposes of enforcing the terms of the Final
Judgment.
On December 6, 2016, following the same trial, Judge Altonaga entered the Final Judgment
against the City's former Budget Director, Michael Boudreaux following the jury's verdict finding Mr.
Boudreaux violated Sections 17(a)(2) and (3) of the Securities Act, and, in three ways, Section 10(b) of
the Exchange Act and Rule 10b-5 thereunder and aiding and abetting the City's violation of Section10(b)
of the Exchange Act and Rule 10b-5 thereunder. The Judge did not enter a permanent injunction against
Mr. Boudreaux, but did assess a $15,000 civil penalty against Mr. Boudreaux. On January 27, 2017,
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Judge Altonaga entered an Order denying Mr. Boudreaux's Motion for a New Trial or Relief from
Judgment.
The 2016 Trial. The trial in Securities and Exchange Commission v. City of Miami, et al.
followed an investigation by the SEC of certain City bond offerings to determine whether there had been
any violations of federal securities laws. At issue, primarily, was whether the City sufficiently disclosed
in its 2009 bond offerings and annual audited financial statements the circumstances of (a) the transfer of
approximately $13 1 million from the Capital Projects Fund to the General Fund in fiscal year 2007 and
(b) the transfer of approximately $13 3 million from the Capital Projects Fund to the General Fund in
fiscal year 2008 (collectively, the "Transfers"). The investigation was partially spurred by Audit Report
No. 010-005, Audit of Compliance with the Financial Integrity Principles, issued by the City of Miami
Office of Independent Auditor General in November 2009. The investigation resulted in the filing of civil
fraud charges against the City and its former budget director based on transactions that occurred with
respect to the City's fiscal years ending September 30, 2007 and September 30, 2008.
The 2016 Complaint Allegations. The SEC alleged the former budget director and the City made
materially false and misleading statements and omissions about the Transfers to hide a growing general
fund deficit and obtain favorable bond ratings for three bond issues in May, July and December of 2009
totaling approximately $153.5 million The SEC also charged the City and the former budget director
with including false and misleading information in the City's 2007 and 2008 audited financial statements.
Specifically, the SEC' s complaint against the City and Boudreaux charged the following
(essentially verbatim from the SEC complaint):
1. The City raised approximately $153 5 million from the investing public through
bond offerings in May, July, and December 2009. In connection with these offerings, the City
made numerous material misrepresentations and omissions to investors in the bond offering
documents and the City's CAFRs concerning certain inter -fund transfers from its Capital Projects
Funds to its General Fund, including transfers of restricted fees.
2. Beginning no later than 2007 until 2009, the City engaged in a series of transfers
from its Capital Projects Funds to its General Fund to mask the General Fund's deficits,
transferred restricted funds into the General Fund, and falsely inflated the General Fund balance
to achieve the City's goal of maintaining $100 million in reserves in its General Fund, and
ultimately obtained more favorable ratings on its bond offerings. To obtain the City
Commission's approval of these inter -fund transfers, Boudreaux made misrepresentations to the
City Commission about the transfers, which falsely represented that the project funds were
unallocated, and concealed the transfers in the City's internal records.
3. The City made numerous material misrepresentations and omissions to the
investing public in its bond offering documents and its 2007 and 2008 CAFRs about the inter -
fund transfers. For example, the City did not disclose the full amount or effect of the transfers to
the General Fund's budget and its fund balance. Further, the City represented that the project
funds transferred in 2007 and 2008 were "unexpended" or "unused," when in reality the funds
were allocated to specific capital projects that still needed the money or had already spent it. The
City also failed to disclose it had not adjusted its Capital Projects Funds budget to reflect the
transfers to the General Fund.
4. Additionally, to ensure rating agencies gave the City's 2009 bond offerings
favorable ratings, in April 2009 the City, through Boudreaux, made material misrepresentations
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and omissions to the agencies concerning the fiscal year 2007 and 2008 transfers and the City's
projected operating deficit for its fiscal year 2009 General Fund.
5. During the same time the City and Boudreaux were making material
misrepresentations and omissions, the City obtained favorable ratings from the rating agencies on
the more than $150 million the City raised from the investing public. Notably, these favorable
ratings allowed the City to obtain the more than $150 million on more favorable terms than if
they had less favorable ratings. Ultimately, the true nature of the transfers was disclosed, many of
the transfers were reversed, and the City's ratings were downgraded.
6. In addition to the above misrepresentations and omissions, the City, through
Boudreaux, engaged in other fraudulent and deceptive conduct in violation of the federal
securities laws, including, but not limited to, misrepresenting the inter -fund transfers to the City
Commission that approved the transfers and by taking affirmative steps to obscure or conceal the
transfers in the City's internal records.
7. By engaging in the conduct set forth in the SEC complaint, the City violated
Section 17(a) of the Securities Act, 15 U.S.C. § 77q; and Section 10(b) of the Exchange Act, 15
U.S.C. § 78j(b) and Rule 10b-5 thereunder, 17 C.F.R. § 240.10b-5. Boudreaux violated Section
17(a) of the Securities Act, 15 U.S.C. § 77q; Section 10(b) of the Exchange Act, 15 U.S.C.
§78j(b) and Rule 10b-5(b) thereunder, 17 C.F.R. § 240.I0b-5; and aided and abetted the City's
violations of Section 10(b) of the Exchange Act, 15 U.S.C. §78j(b) and Rule 10b-5 thereunder, 17
C.F.R. § 240.10b-5.
The 2003 Cease and Desist Order
The earlier 2003 Cease and Desist Order was issued by the SEC in a Cease and Desist Proceeding
on appeal from the decision of an administrative law judge. The law judge found that the City willfully
violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act, and Exchange Act Rule
10b-5 with respect to its offer and sale of three municipal bond issues. The law judge ordered the City to
cease and desist from committing or causing any violation or any future violation of the antifraud
provisions.
Upon independent review of the record, the SEC issued an opinion that found that in the three
bond issues, the City used financial statements that failed to warn investors about its ongoing fmancial
stress; falsely certified that there had been "no material adverse change" in its financial condition since
fiscal year 1994, even though Miami faced a cash shortfall of over $30 million; and depicted a balanced
budget, knowing that $12 million in revenue would not be forthcoming. On the basis of the opinion, the
SEC ordered that the City cease and desist from committing or causing any violations or future violations
of Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act, and Exchange Act Rule 10b-5.
Disclosure Related Investigation
In 2011, the SEC commenced an investigation in connection with the City's Special Obligation
Parking Revenue Bonds, Series 2010A and Series 2010B (Marlins Stadium Project). The City fully
cooperated with the SEC during the course of its investigation. The SEC concluded its investigation in
February 2016 with no charges being filed.
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City's Current Capital and Operating Budget and Financial Reporting Procedures
Both the Securities and Exchange Commission v. City of Miami, et al. investigation and trial and
the 2003 Cease and Desist Order involved materially false and misleading statements in the City's
financial statements.
Testimony in the civil trial highlighted the difficulties encountered in the changeover of certain
financial accounting software and the lack of interface between budget and accounting programs.
The Office of Management and Budget ("OMB") thoroughly reviewed all procedures after the
SEC began its investigations (such reviews undertaken in 2014 and again in 2016). In light of such
reviews, the City has instituted several improved processes, with respect to its budget. All interfund
transfers are clearly identified in the budget book and are approved by the City Commission. The OMB
does not have access to physically override the budget in the financial system, which serves as a check -
and -balance by the Finance Department. The fiscal year-end close out is presented to the City
Commission within 60 days of the general ledger close instead of March or April of the following fiscal
year. Budget book production and monthly projections are prepared in the Hyperion Budgeting System
instead of in Word and Excel. The OMB presents the annual Capital Plan (and subsequent amendments)
instead of the Office of Capital Improvements and projects are funded and defunded appropriately. Bond -
funded projects are funded by virtue of a Declaration of Intent to Reimburse instead of premature issue of
bonds. Finally, all new OMB employees are required to attend the Government Finance Officers
Association budgeting boot camp within 24 months of beginning employment.
LEGAL MATTERS
Certain legal matters incident to the validity of the Series 2018 Bonds are subject to the approval
of Bryant Miller Olive P.A., Bond Counsel, Miami, Florida whose approving opinion in the form attached
hereto as "APPENDIX D — FORM OF BOND COUNSEL OPINION" will be furnished without charge
to the purchasers of the Series 2018 Bonds at the time of their delivery. The actual legal opinion to be
delivered may vary from that text if necessary to reflect facts and law on the date of delivery.
Certain legal matters will be passed upon for the City by Victoria Mendez, Esq., City Attorney,
and by Squire Patton Boggs (US) LLP, Miami, Florida, Disclosure Counsel to the City.
D.C.
Certain legal matters will be passed upon for the Underwriters by Bracewell LLP, Washington,
LITIGATION [To Be Updated]
There is no pending or, to the knowledge of the City, any threatened litigation against the City of
any nature whatsoever which in any way questions or affects the validity of the Series 2018 Bonds, or any
proceedings or transactions relating to their issuance, sale, execution, or delivery, or the adoption of the
Resolution, or the levy of the ad valorem taxes. Neither the creation, organization or existence, nor the
title of the present members of the City Commission or other officers of the City is being contested. For
information regarding past investigations by the SEC and pending litigation with the SEC, see
"SECURITIES AND EXCHANGE COMMISSION INVESTIGATIONS" herein.
The following are summaries of pending litigation or asserted claims, of which the City is aware,
having an exposure either (a) not capped by the limitations of s. 768.28(5), Florida Statutes (2012), i.e.,
$200,000 per person/$300,000 per incident; and (b) not covered by the availability of excess insurance
purchased by the City to cover certain liabilities in excess of a $500,000 self -insured retention.
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DOJ v. City of Miami
On March 10, 2016, Department of Justice (DOJ) and the City entered into a Settlement
Agreement (the "Settlement Agreement"). The Settlement Agreement marked the culmination of an
investigation by the DOJ regarding civil rights violations by the City of Miami Police Department
surrounding police shooting incidents and the inadequate investigation of such police shooting incidents
thereafter. The investigation's findings, issued in July 2013, identified a pattern or practice of excessive
use of force through officer -involved shootings in violation of the Fourth Amendment of the Constitution.
Under the Settlement Agreement, the City agreed to operate under a four-year monitorship. The City has
implemented internal controls and procedures, including enhanced training and supervision to ensure that
similar violations do not occur in the future. The City could be subject to additional penalties for any
future noncompliance under the monitoring program and the Settlement Agreement.
Fraternal Order of Police, Walter E. Headley, Jr., Miami Lodge No. 20 v. City of Miami
The FOP Miami Lodge 20 (hereinafter the "Police Union") alleges that it has a Collective
Bargaining Agreement with the City, effective through September 30, 2010, that the parties exchanged
initial proposals for a successor agreement, and that the parties have held several bargaining sessions.
The Police Union further alleges that during the several bargaining sessions, the City never advised the
Police Union that there was a need to reach settlement on economic items expeditiously, or that the City
intended to declare a "financial urgency" and invoke the process set forth in Section 447.4095, Florida
Statutes. The Police Union contends that Section 447.4095 may only be invoked to modify the terms of
an existing agreement. The Police Union further alleges that although the parties continued to bargain for
a successor collective bargaining agreement on August 9 and 12, 2010, the parties never discussed wages
or pensions, but on August 16, 2010, the City advised the Public Employees Relations Commission
("PERC") that it had engaged in negotiations on the impact of the financial urgency, and any action
necessitated by the financial urgency, and that a dispute existed. The Police Union then alleges that on
August 31, 2010, the City unilaterally took action to alter the terms and conditions of employment before
reaching impasse with the Police Union, in violation of Section 447.501(1)(a) and (1)(c). Further, the
Police Union alleges that, although the changes were not discussed with them, they were discussed in a
closed door unnoticed "shade" meeting conducted in violation of Section 447.605, Florida Statutes (an
exemption to the Sunshine Law). The Police Union contends that the failure of the City to have any
discussions with the Police Union on these matters constitutes bad faith or surface bargaining in violation
of Section 447.501(1)II (a), Florida Statutes. It also asserts that by unilaterally altering terms and
conditions of employment before completion of the impasse procedure set forth in Section 447.403,
Florida Statutes, and by not responding to a request for records, the City violated Section 447.501(1)(a)
and (1)(c), Florida Statutes. The City received a recommended order from the Hearing Officer in its
favor, which was ultimately adopted by the City Commission. The FOP appealed to the Florida District
Court of Appeals, First District. The First District affirmed. The FOP sought review by the Florida
Supreme Court. The Florida Supreme Court accepted review. The Supreme Court heard oral argument
on April 7, 2015. On March 2, 2017, the Florida Supreme Court issued a decision in favor of FOP,
quashing the decision of the First District and remanding the case to the First District for proceedings
consistent with State law. The PERC entered an Order on the Merits of the Unfair Labor Practice Charge
and scheduled a back -pay hearing in June 2018. Despite the pendency of the back -pay case, the FIPO
Trust voted to disburse adjusted pension payments to its members. The City filed an injunction and the
Third District Court of Appeal held that the FIPO Trust had no authority to make adjusted pension
payments at that time, and that neither the Florida Supreme Court decision in Headley, nor the October
18, 2017 PERC Order rescinded the City's current pension code. The Third District Court of Appeal
emphasized that only the City has the authority to change its pension code, as appropriate, and, at the
conclusion of the financial urgency litigation proceedings. The Third District also affirmed the trial
court's ruling abating the proceedings pursuant to Chapter 164 of the Florida Statutes. Pursuant to the
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Court's opinion, the parties should commence formal intergovernmental dispute resolution proceedings
under Florida Statutes Chapter 164. The City cannot predict the outcome of this case or the financial
consequences, if any. The FOP backpay case before the PERC began on June 18, 2018. FOP presented its
case and the parties agreed to close the record and attempt mediation. If mediation fails the parties will re-
open the record and resume the case. The parties will attempt mediation on June 26, 2018.
International Association of Firefighters, Local 587 v. City of Miami
The IAF Local 587 (hereinafter "Firefighters Union") alleges that it has a Collective Bargaining
Agreement ("CBA") with the City, effective through October 1, 2010, that, in exchange for concessions
by the Firefighters Union, the CBA was extended through September 30, 2011, and that the City
expressly waived its right not to fund any year of the CBA except in the case of "true fiscal emergency",
defined in the CBA as, "the City must demonstrate that there is no other reasonable alternative means of
appropriating monies to fund the agreement for that year or years". The Firefighters Union further alleges
that less than six (6) months after agreeing to the extension, on April 30, 2010, the City invoked the
process under Section 447.4095, Florida Statutes, claiming "financial urgency," and on August 31, 2010,
unilaterally took action to modify wages, insurance and pension benefits. The Firefighters Union asserts
that the invocation of Section 447.4095, Florida Statutes was improper and was waived by the City in the
CBA. Further, the Firefighters Union alleges that, prior to their enactment, the modifications to the CBA
were discussed in a closed door, unnoticed shade meeting in violation of Section 447.605, Florida
Statutes (an exemption to the Sunshine Law). Finally, the Firefighters Union asserts that the City failed
to bargain collectively and in good faith by enacting the changes of August 31, 2010, by not providing the
Firefighters Union with notice in advance, and by failing to discuss, bargain over, impact bargain, or
complete the process set forth in Section 447.403 and/or Section 447.4095, Florida Statutes. The City
received a recommended order from the Hearing Officer in its favor, which was adopted by the City
Commission. The Third District remanded the case back to PERC, consistent with the outcome in
Headley v. City of Miami. The PERC entered an Order on the Merits of the Unfair Labor Practice
Charge and scheduled a backpay hearing in June 2018. The City cannot predict the outcome of this case
or financial consequences, if any. The Firefighters Union backpay case before the PERC began on June 5,
2018. The record was recessed so that the parties could attempt mediation. Mediation began on June 5,
2018 and was continued on June 15, 2018. The parties are relatively close to resolving the case but have
not yet reached an agreement. The second day of the PERC hearing is scheduled for June 27, 2018.
Jorge Castro v. City of Miami, et. al.
Jorge Castro, individually and as class representative filed a lawsuit against the City, the City of
Miami Firefighters' and Police Officers' Retirement Trust and Plan ("Plan"), The Board of Trustees of
the Plan ("Board"), Carlos Migoya (former City Manager) and Dania Orta (Assistant Plan Administrator)
in the U.S. District Court Southern District of Florida (Case No. 1:13-cv-22661-WJZ). The City was
formally served on August 2, 2013 and the plaintiff presented alleged claims for: breach of fiduciary
duties, plan benefits, plan benefits as a result of misrepresentation, negligent misrepresentations, violation
of 42 U.S.C. s. 1983 (procedural due process), impairment of contract, violation of Citizens' Bill of
Rights, and declaratory judgment. The court granted an order of dismissal in favor of the City and all
claims have been dismissed.
Catholic Archdiocese of Miami v. City of Miami
On April 9, 2013, the Catholic Archdiocese (the "Archdiocese") of Miami filed a lawsuit against
the City alleging diminution of property values due to the City's enactment of the Miami 21 Zoning
Code. The lawsuit asserts claims seeking $89 million dollars in damages, plus interest, attorneys fees,
and expenses under the Bert J. Harris, Jr. Private Property Rights Protection Act, Section 70.001, Florida
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Statutes regarding four parcels of property owned by the Archdiocese and located at 3333, 3601, 3667,
and 3675 South Miami Avenue within the City. The City filed a motion to dismiss which is pending. At
this time, the City cannot predict with certainty the outcome of this lawsuit. See The Most Reverend
Thomas G. Wenski, Archbishop of the Archdiocese of Miami, Inc. v. City of Miami, Miami -Dade County
Circuit Court, Case No. 13-12523 CA 06.
City of Miami Incinerator "Old Smokey" Claims
Individuals who owned property and/or resided, attended schools and/or played in parks allegedly
contaminated with residue from a City of Miami Incinerator ("Old Smokey"), which was demolished in
1974 have asserted claims of negligence, medical monitoring, damages under Florida Statutes 376.313
and inverse condemnation in a putative class action lawsuit (Styles, et. al. v. City of Miami, Miami -Dade
County Circuit Court, Case No. 17-22967). Separate lawsuits brought by an individual property owner
for trespass, negligence, private nuisance, unjust enrichment, damages under Florida Statutes 376.313,
strict liability and injunctive relief (Sweetbaum v. City of Miami, Miami -Dade County Circuit Court, Case
No. 17-25743) and under the Resource Conservation and Recovery Act, 42 U.S.C. 6901, et seq.
(Sweetbaum v. City of Miami, United States District Court, Case No. 17-cv-24680) claim intentional or
negligent contamination of plaintiff's property from Old Smokey. At this time, the City cannot predict
with certainty the outcome of these lawsuits.
Civil Rights Actions
In a civil rights action brought under 42 U.S.C. 1983, a plaintiff claims that on or about
November 18, 2009 he was arrested for murder and filmed by a First 48 television crew during
questioning. A jury returned a verdict of $860,200, including $403,450 for the state law claim of false
imprisonment, subject to the sovereign immunity cap of $100,000 absent a claims bill; and $456,750 for
the federal claims not subject to the statutory sovereign immunity cap. The City has appealed the verdict
and is awaiting a decision. (Taiwan Smart v. City of Miami, United States District Court, Case No. 13-cv-
24354-MGC and Eleventh Circuit Court of Appeals, Case No. 16-16740) In a separate action under
federal and state law for damages claiming false arrest and excessive force against the City, four
identified and five unidentified police officers and the Chief of Police, a plaintiff asserts that on or about
June 21, 2013, police officers subjected him to force resulting in serious injuries. At this time, the City
cannot predict with certainty the outcome of this lawsuit. (Alexandre v. City of Miami, et al., United
States District Court, Case No. 16-cv-23064) The personal representative of the Estate of Fritz Severe has
alleged 42 U.S.C. 1983 claims against the City and Officer Antonio Vicente Torres, IV for fourth
amendment violations. The plaintiff also sued the City in a wrongful death action under state law. At this
time, the City cannot predict with certainty the outcome of this lawsuit. (Francois Severe, as personal
representative of the estate of Fritz Severe v. City of Miami and Antonio Vicente Torres, IV, individually,
and in his capacity as a City of Miami Police Officer, United States District Court, Case No. 17-cv-
22153)
Flagstone v. City of Miami
Plaintiffs sued the City for breach of contract, declaratory relief, injunctive relief and unjust
enrichment related to claims that the City breached an Amended Agreement to Enter and the
Retail/Parking Lease Agreement when the City Manager issued a notice of default pursuant to Resolution
R-17-0263 adopted by the City Commission on May 30, 2017. Additionally, the plaintiffs seek injunctive
relief with respect to the operation of a marina and other related agreements. The trial court bifurcated
liability and damages on the liability phase of the case, the trial court conducted a non jury trial and found
in favor of Flagstone. The damages phase of the trial is set for February 2019. (Flagstone Island Gardens,
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LLC and Flagstone Development Corp. v. City of Miami, Miami -Dade Circuit Court, Case No. 17-13829
CA 44)
Internal Revenue Service Examinations
On November 18, 2011, the City was notified by an examination request letter from the
Department of Treasury, Internal Revenue Service ("IRS"), informing the City that its $153,060,000 City
of Miami, Florida Limited Ad Valorem Tax Refunding Bonds, Series 2007A (Homeland
Defense/Neighborhood Capital Improvement Projects) (the "2007A Bonds") and City of Miami, Florida
Limited Ad Valorem Tax Bonds, Series 2007B (Homeland Defense/Neighborhood Capital Improvement
Projects) dated July 10, 2007 (the "2007B Bonds") (collectively, the "Series 2007 Homeland
Defense/Neighborhood Capital Improvement Bonds) were selected for a routine examination to
determine compliance with federal tax requirements regarding arbitrage under sections 148 and 149 of the
Internal Revenue Code.
The City cooperated fully with the IRS examination and requests for documentation and
information. On October 18, 2013, the IRS sent the City a Notification of No Change Determination,
which concluded that examination, confirmed the tax-exempt status of the Series 2007 Homeland
Defense/Neighborhood Capital Improvement Bonds, and required the City to continue to yield restrict
any unspent proceeds and to spend any remaining proceeds as soon as possible. The City has completed
its required spend -down on the Series 2007 Homeland Defense/Neighborhood Capital Improvement
Bonds proceeds and interest thereon, and has filed its updated Arbitrage Rebate Report with the IRS
demonstrating that the City continued to yield restrict any remaining unspent proceeds and interest of the
Series 2007 Homeland Defense/Neighborhood Capital Improvement Bonds and therefore, the City was
not required to rebate any funds to the IRS. The 2007B Bonds were refunded on December 17, 2015.
On March 15, 2017, the City was notified by an examination request letter from the IRS,
informing the City that its $80,000,000 City of Miami, Florida Special Obligation Bonds, Series 2007
(Street and Sidewalk Improvement Program) were selected for examination to determine compliance with
federal tax requirements regarding arbitrage under sections 148 and 149 of the Internal Revenue Code of
1986, as amended (the "Code").
The City is currently engaged in an ongoing IRS examination regarding payroll taxes and the
differences between "employees" and "independent contractors." The City is disputing the
characterizations used by the IRS auditors. At this time, the City cannot predict with certainty the
outcome of this dispute.
The City cooperated fully with the IRS examination and requests for documentation and
information. On August 31, 2017, the IRS sent the City a Notification of No Change Determination,
which concluded that examination and confirmed the tax-exempt status of the Series 2007 Bonds.
U.S. Treasury Offset Program
The City is involved in multiple disputes involving the U.S. Department of Treasury Offset
Program involving payments garnished under that program to former City employees and Medicare
Secondary Payments unrelated to workers compensation injuries. At this time, the City cannot predict
with certainty the outcome of this dispute.
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Petroleum Products Corporation
An environmental claim is presently being asserted by the United States of America involving an
alleged disposal by the City of Miami Fire Department's service garage of 83,055 gallons of waste oil to
Petroleum Products Corporation ("PPC") on November 25, 1972. PPC allegedly operated as a processor
and broker of waste oil at a site located in Hollywood, Florida, and, during its period of operation,
disposed of sludges generated from the oil refining process in unlined pits on the site. Contamination
assessment and initial remedial activities undertaken by the United States Environmental Protection
Agency ("EPA") and the State Department of Environmental Protection ("DEP") during the past ten (10)
years indicate that the soils and groundwater at the site are significantly contaminated by waste oil and
other hazardous wastes.
Based on an invoice, allegedly documenting the City's involvement in this matter, the EPA has
advised that it considers the City a generator of hazardous wastes at the site and, therefore, jointly and
severally liable for the cleanup and recovery costs at the site. EPA's preliminary estimate for the
collective costs of remedial activities at the site is approximately $26 million dollars. It should be noted
that in April, 1999, the EPA offered the City a de minimis settlement offer of $344,109; however, the
City rejected the offer. Outside counsel has re-evaluated this matter for the City and estimated the City's
potential exposure for soil cleanup activities to be $154,960. This sum was calculated by multiplying the
City's allocated share of liability within the Cooperating Parties Group ("CPG") - 0.596% - against what
counsel for the CPG has advised is one possible worst case cost scenario to the CPG - $20 million
DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS
Rule 69W-400.003, Rules of Government Securities, promulgated by the Office of Financial
Regulation of the Financial Services Commission, under Section 517.051(1), Florida Statutes ("Rule
69W- 400.003"), requires the City to disclose each and every default as to the payment of principal and
interest with respect to obligations issued by the City after December 31, 1975. Rule 69W-400.003
further provides, however, that if the City in good faith believes that such disclosures would not be
considered material by a reasonable investor, such disclosures may be omitted. The City has not
defaulted on the payment of principal or interest with respect to obligations issued by the City after
December 31, 1975.
TAX MATTERS [To Be Expanded To Address Taxable Bonds]
General
The Code establishes certain requirements which must be met subsequent to the issuance of the
Series 2018 Bonds in order that interest on the Series 2018 Bonds be and remain excluded from gross
income for purposes of federal income taxation. Non-compliance may cause interest on the Series 2018
Bonds to be included in federal gross income retroactive to the date of issuance of the Series 2018 Bonds,
regardless of the date on which such non-compliance occurs or is ascertained. These requirements
include, but are not limited to, provisions which prescribe yield and other limits within which the
proceeds of the Series 2018 Bonds and the other amounts are to be invested and require that certain
investment earnings on the foregoing must be rebated on a periodic basis to the Treasury Department of
the United States. The City has covenanted in the Resolution with respect to the Series 2018 Bonds to
comply with such requirements in order to maintain the exclusion from federal gross income of the
interest on the Series 2018 Bonds.
In the opinion of Bond Counsel, assuming compliance with certain covenants, under existing
laws, regulations, judicial decisions and rulings, interest on the Series 2018 Bonds is excluded from gross
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income for purposes of federal income taxation. Interest on the Series 2018 Bonds is not an item of tax
preference for purposes of the federal alternative minimum tax. However, interest on the Series 2018
Bonds shall be taken into account in determining adjusted current earnings for purposes of computing the
alternative minimum tax on corporations for taxable years that began prior to January 1, 2018. The
alternative minimum tax on corporations was repealed for taxable years beginning on and after January 1,
2018.
Except as described above, Bond Counsel will express no opinion regarding other federal income
tax consequences resulting from the ownership of, receipt or accrual of interest on, or disposition of
Series 2018 Bonds. Prospective purchasers of Series 2018 Bonds should be aware that the ownership of
Series 2018 Bonds may result in collateral federal income tax consequences, including (i) the denial of a
deduction for interest on indebtedness incurred or continued to purchase or carry Series 2018 Bonds;
(ii) the reduction of the loss reserve deduction for property and casualty insurance companies by fifteen
percent (15%) of certain items, including interest on Series 2018 Bonds; (iii) the inclusion of interest on
Series 2018 Bonds in earnings of certain foreign corporations doing business in the United States for
purposes of the branch profits tax; (iv) the inclusion of interest on Series 2018 Bonds in passive income
subject to federal income taxation of certain Subchapter S corporations with Subchapter C earnings and
profits at the close of the taxable year; and (v) the inclusion of interest on Series 2018 Bonds in "modified
adjusted gross income" by recipients of certain Social Security and Railroad Retirement benefits for the
purposes of determining whether such benefits are included in gross income for federal income tax
purposes.
As to questions of fact material to the opinion of Bond Counsel, Bond Counsel will rely upon
representations and covenants made on behalf of the City, certificates of appropriate officers and
certificates of public officials (including certifications as to the use of proceeds of the Series 2018 Bonds
and of the property financed or refinanced thereby), without undertaking to verify the same by
independent investigation.
PURCHASE, OWNERSHIP, SALE OR DISPOSITION OF THE SERIES 2018 BONDS AND
THE RECEIPT OR ACCRUAL OF THE INTEREST THEREON MAY HAVE ADVERSE FEDERAL
TAX CONSEQUENCES FOR CERTAIN INDIVIDUAL AND CORPORATE BONDHOLDERS,
INCLUDING, BUT NOT LIMITED TO, THE CONSEQUENCES DESCRIBED ABOVE.
PROSPECTIVE BONDHOLDERS SHOULD CONSULT WITH THEIR TAX SPECIALISTS FOR
INFORMATION IN THAT REGARD.
Information Reporting and Backup Withholding
Interest paid on tax-exempt bonds such as the Series 2018 Bonds is subject to information
reporting to the Internal Revenue Service in a manner similar to interest paid on taxable obligations. This
reporting requirement does not affect the excludability of interest on the Series 2018 Bonds from gross
income for federal income tax purposes. However, in conjunction with that information reporting
requirement, the Code subjects certain non -corporate owners of Series 2018 Bonds, under certain
circumstances, to "backup withholding" at the rate specified in the Code with respect to payments on the
Series 2018 Bonds and proceeds from the sale of Series 2018 Bonds. Any amount so withheld would be
refunded or allowed as a credit against the federal income tax of such owner of Series 2018 Bonds. This
withholding generally applies if the owner of Series 2018 Bonds (i) fails to furnish the payor such owner's
social security number or other taxpayer identification number ("TIN"), (ii) furnished the payor an
incorrect TIN, (iii) fails to properly report interest, dividends, or other "reportable payments" as defined in
the Code, or (iv) under certain circumstances, fails to provide the payor or such owner's securities broker
with a certified statement, signed under penalty of perjury, that the TIN provided is correct and that such
owner is not subject to backup withholding. Prospective purchasers of the Series 2018 Bonds may also
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wish to consult with their tax advisors with respect to the need to furnish certain taxpayer information in
order to avoid backup withholding.
Other Tax Matters
During recent years, legislative proposals have been introduced in Congress, and in some cases
enacted, that altered certain federal tax consequences resulting from the ownership of obligations that are
similar to the Series 2018 Bonds. In some cases, these proposals have contained provisions that altered
these consequences on a retroactive basis. Such alteration of federal tax consequences may have affected
the market value of obligations similar to the Series 2018 Bonds. From time to time, legislative proposals
are pending which could have an effect on both the federal tax consequences resulting from ownership of
the Series 2018 Bonds and their market value. No assurance can be given that legislative proposals will
not be enacted that would apply to, or have an adverse effect upon, the Series 2018 Bonds.
Prospective purchasers of the Series 2018 Bonds should consult their own tax advisors as to the
tax consequences of owning the Series 2018 Bonds in their particular state or local jurisdiction and
regarding any pending or proposed federal or state tax legislation, regulations or litigation, as to which
Bond Counsel expresses no opinion.
[Tax Treatment of Original Issue Discount
Under the Code, the difference between the maturity amount of the Series 2018 Bonds maturing
on (collectively, the "Discount Bonds"), and the initial offering price to the public,
excluding bond houses, brokers or similar persons or organizations acting in the capacity of underwriters
or wholesalers, at which price a substantial amount of the Discount Bonds of the same maturity and, if
applicable, interest rate, was sold is "original issue discount." Original issue discount will accrue over the
term of the Discount Bonds at a constant interest rate compounded periodically. A purchaser who
acquires the Discount Bonds in the initial offering at a price equal to the initial offering price thereof to
the public will be treated as receiving an amount of interest excludable from gross income for federal
income tax purposes equal to the original issue discount accruing during the period he or she holds the
Discount Bonds, and will increase his or her adjusted basis in the Discount Bonds by the amount of such
accruing discount for purposes of determining taxable gain or loss on the sale or disposition of the
Discount Bonds. The federal income tax consequences of the purchase, ownership and redemption, sale
or other disposition of the Discount Bonds which are not purchased in the initial offering at the initial
offering price may be determined according to rules which differ from those above. Bondholders of the
Discount Bonds should consult their own tax advisors with respect to the precise determination for federal
income tax purposes of interest accrued upon sale, redemption or other disposition of the Discount Bonds
and with respect to the state and local tax consequences of owning and disposing of the Discount Bonds.]
[Tax Treatment of Bond Premium
The difference between the principal amount of the Series 2018 Bonds maturing on
(collectively, the "Premium Bonds"), and the initial offering price to the public
(excluding bond houses, brokers or similar persons or organizations acting in the capacity of underwriters
or wholesalers) at which price a substantial amount of such Premium Bonds of the same maturity and, if
applicable, interest rate, was sold constitutes to an initial purchaser amortizable bond premium which is
not deductible from gross income for federal income tax purposes. The amount of amortizable bond
premium for a taxable year is determined actuarially on a constant interest rate basis over the term of each
of the Premium Bonds, which ends on the earlier of the maturity or call date for each of the Premium
Bonds which minimizes the yield on such Premium Bonds to the purchaser. For purposes of determining
gain or loss on the sale or other disposition of a Premium Bond, an initial purchaser who acquires such
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obligation in the initial offering is required to decrease such purchaser's adjusted basis in such Premium
Bond annually by the amount of amortizable bond premium for the taxable year. The amortization of
bond premium may be taken into account as a reduction in the amount of tax-exempt income for purposes
of determining various other tax consequences of owning such Premium Bonds. Bondholders of the
Premium Bonds are advised that they should consult with their own tax advisors with respect to the state
and local tax consequences of owning such Premium Bonds.]
RATINGS
Moody's Investors Service, Inc. and S&P Global, a division of S&P Global Inc. have assigned
their municipal bond ratings of " " (stable outlook)," and " " (stable outlook)," respectively to
the Series 2018 Bonds.
The ratings reflect only the views of said rating agencies and an explanation of the ratings may be
obtained only from said rating agencies. There is no assurance that such ratings will continue for any
given period of time or that they will not be lowered or withdrawn entirely by the rating agencies, or any
of them, if in their judgment, circumstances so warrant. A downward change in or withdrawal of any of
such ratings, may have an adverse effect on the market price of the Series 2018 Bonds.
VERIFICATION OF MATHEMATICAL COMPUTATIONS
The accuracy of the arithmetical computations demonstrating the adequacy of the maturing
principal and interest on the Escrow Securities and cash held by the Escrow Agent to pay, when due, the
principal of and interest on the Refunded Bonds will be verified by Robert Thomas CPA, LLC.
FINANCIAL ADVISOR
PFM Financial Advisors LLC, Coral Gables, Florida ("PFM") is the Financial Advisor to the City
with respect to the issuance and sale of the Series 2018 Bonds. The Financial Advisor has assisted the
City in the preparation of this Limited Offering Memorandum and has advised the City as to other matters
relating to the planning, structuring and issuance of the Series 2018 Bonds. The Financial 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 Limited
Offering Memorandum.
PFM is an independent advisory firm and is not engaged in the business of underwriting, trading
or distributing municipal or other public securities.
FINANCIAL STATEMENTS
The Basic Financial Statements of the City for the fiscal year ended September 30, 2016 and
report thereon of RSM US LLP, an independent certified public accountant (the "Independent Certified
Public Accountant"), are attached hereto as "APPENDIX C — BASIC FINANCIAL STATEMENTS OF
THE CITY OF MIAMI FOR FISCAL YEAR ENDED SEPTEMBER 30, 2017 (Excerpt of the City of
Miami Comprehensive Annual Financial Report)." Such statements speak only as of September 30,
2016.
Such statements have been included as a public document and the Independent Certified Public
Accountant has consented to the inclusion of such statements in this Limited Offering Memorandum but
has not participated in the preparation of this Limited Offering Memorandum.
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010-8616-7788/4/AM ERICAS
UNDERWRITING
The Series 2018 Bonds are being purchased by the underwriters shown on the cover of the
Limited Offering Memorandum (collectively, the "Underwriters") at an aggregate purchase price of
$ (the $ par amount of the Series 2018 Bonds, [plus] [less] [net] original
issue [premium] [discount] of $ , less Underwriters' discount of $ . The
Underwriters' obligations are subject to certain conditions precedent described in the Bond Purchase
Contract entered into between the City and the Underwriters, and they will be obligated to purchase all of
the Series 2018 Bonds if any Series 2018 Bonds are purchased. The Series 2018 Bonds may be offered
and sold to certain dealers (including dealers depositing such Series 2018 Bonds into investment trusts) at
prices lower than such public offering prices, and such public offering prices may be changed, from time
to time, by the Underwriters.
PNC Bank, National Association currently has, and from time to time in the future may have,
banking or other credit relationships with the City. PNC Capital Markets LLC is acting as an underwriter
of the Series 2018 Bonds. PNC Capital Markets LLC and PNC Bank, National Association are both
wholly owned subsidiaries of The PNC Financial Services Group, Inc.
CONTINGENT FEES
The City has retained Bond Counsel, Financial Advisor and Disclosure Counsel with respect to
the authorization, sale, execution and delivery of the Series 2018 Bonds. Payment of the fees of such
professionals and an underwriting discount to the Underwriters are each contingent upon the issuance of
the Series 2018 Bonds.
ENFORCEABILITY OF REMEDIES
The remedies available to the owners of the Series 2018 Bonds upon an event of default under the
Resolution are in many respects dependent upon judicial actions which are often subject to discretion and
delay. Under existing constitutional and statutory law and judicial decisions, including specifically the
federal bankruptcy code, the remedies specified by the Resolution and the Series 2018 Bonds may not be
readily available or may be limited. For example, the Series 2018 Bonds may be treated as unsecured
obligations of the City under Chapter 9 of the federal bankruptcy code and the ability of a Bondholder to
seek and obtain a writ of mandamus may be limited if a Chapter 9 proceeding was instituted by the City,
which in the State requires the approval of the Governor. The various legal opinions to be delivered
concurrently with the delivery of the Series 2018 Bonds, including Bond Counsel's approving opinion,
will be qualified, as to the enforceability of the remedies provided in the various legal instruments, by
limitations imposed by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of
creditors enacted before or after such delivery.
CONTINUING DISCLOSURE
The City will covenant for the benefit of the Series 2018 Bondholders to provide certain financial
information and operating data relating to the City and the Series 2018 Bonds in each year (the "Annual
Report"), and to provide notices of the occurrence of certain enumerated events. Such covenant will only
apply so long as the Series 2018 Bonds remain outstanding. The Annual Report and any notices of
enumerated events will be filed by the City with the Municipal Securities Rulemaking Board's Electronic
Municipal Market Access ("EMMA") system for municipal securities disclosures as described in the
proposed form of Disclosure Dissemination Agent Agreement (the "Disclosure Agreement") attached
hereto as APPENDIX E to be executed by the City at the time of issuance of the Series 2018 Bonds.
Failure of the City to comply with the provisions of the Disclosure Agreement will not constitute an event
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010-8616-7788/4/AM ERICAS
of default under the Resolution. It is the position of the City that the sole and exclusive remedy of any
holder of a Series 2018 Bond for enforcement of the provisions of the Disclosure Agreement will be an
action of mandamus or specific performance to cause the City to comply with its obligations thereunder.
The City's dissemination agent for such undertakings is Digital Assurance Certification, L.L.C. ("DAC").
These covenants have been made in order to assist the Underwriters in complying with the continuing
disclosure requirements of Rule 15c2-12 (the "Rule") promulgated by the SEC. With respect to the Series
2018 Bonds, no party other than the City is obligated to provide, nor is expected to provide, any
continuing disclosure information with respect to the Rule.
[The City has undertaken certain continuing disclosure obligations in prior continuing disclosure
certificates in connection with its outstanding debt to provide certain financial and operating information
and notices to EMMA. The City has had instances in the past in which it failed to fully comply with its
prior continuing disclosure undertakings, as detailed below.
(1) For fiscal year 2014, the City failed to timely file its annual report (with no specific
notice of late filing given). When this report was filed, it was not associated with one prior series of
bonds which matured prior to the late filing date.
(2) For fiscal year 2013, the City failed to timely file its annual report (with no specific
notice of late filing given).
(3) For fiscal year 2012, the City failed to timely file its annual financial statements and its
annual report with respect to two bond issues having a June 1 filing deadline (notice of late filing was
given and dated June 3, 2013).
(4) For fiscal years 2012 through 2014, the City's annual reports failed to conform to all
necessary requirements at the time they were filed. The City made a remedial filing related to this on
April 25, 2017. The City's disclosure template was modified in 2015 to correct this issue in future filings.
(5) For fiscal years 2012 through 2015, the debt service coverage table included in the City's
annual report for the Refunded Bonds did not reference the Series 2009 Bonds or include the debt service
on the Series 2009 Bonds in the calculation of maximum annual debt service. Upon discovery of this, a
corrective filing was made on February 10, 2017 that included coverage information for the fiscal years
2012 through 2015. The City's disclosure template has been modified to correct this issue in future
filings.
(6) No event notice was filed in 2013 for a rating assignment to a single CUSIP of the City's
Non -Ad Valorem Revenue Bonds (Taxable Pension), Series 1995. These bonds matured on December 1,
2015.
(7) The City failed to timely file or failed to file an event notice in 2013 for a bond insurer
rating assignment to the City's Special Obligation Non -Ad Valorem Revenue Refunding Bonds, Series
2002A, which bonds were redeemed on September 1, 2014 and to the City's Special Obligation Non -Ad
Valorem Revenue Refunding Bonds, Series 2002C, which bonds were redeemed on September 1, 2014.]
[Pending review and update]
ACCURACY AND COMPLETENESS OF LIMITED OFFERING MEMORANDUM
The references, excerpts, and summaries of all documents, statutes, and information concerning
the City and certain reports and statistical data referred to herein do not purport to be complete,
comprehensive and definitive and each such summary and reference is qualified in its entirety by
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010-8616-7788/4/AM ERICAS
reference to each such document for full and complete statements of all matters of fact relating to the
Series 2018 Bonds, the security for the payment of the Series 2018 Bonds and the rights and obligations
of the owners thereof and to each such statute, report or instrument.
The appendices attached hereto are integral parts of this Limited Offering Memorandum and must
be read in their entirety together with all foregoing statements. The information and expressions of
opinions herein are subject to change without notice and neither the delivery of this Limited Offering
Memorandum nor any sale made hereunder is to create, under any circumstances, any implication that
there has been no change in the affairs of the City from the date hereof.
FORWARD -LOOKING STATEMENTS
This Limited Offering Memorandum contains certain "forward -looking statements" concerning
the City's operations, performance and financial condition, including its future economic performance,
plans and objectives and the likelihood of success in developing and expanding. These statements are
based upon a number of assumptions and estimates which are subject to significant uncertainties, many of
which are beyond the control of the City. The words "may," "would," "could," "will," "expect,"
"anticipate," "believe," "intend," "plan," "estimate" and similar expressions are meant to identify these
forward -looking statements. Actual results may differ materially from those expressed or implied by
these forward -looking statements.
MISCELLANEOUS
Any statements made in this Limited Offering Memorandum involving matters of opinion or of
estimates, whether or not so expressly stated are set forth as such and not as representations of fact, and
no representation is made that any of the estimates will be realized. Neither this Limited Offering
Memorandum nor any statement that may have been made verbally or in writing is to be construed as a
contract with the owners of the Series 2018 Bonds.
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010-8616-7788/4/AM ERICAS
AUTHORIZATION OF LIMITED OFFERING MEMORANDUM
The execution and delivery of this Limited Offering Memorandum has been duly authorized and
approved by the City. At the time of delivery of the Series 2018 Bonds, the City will furnish a certificate
to the effect that nothing has come to their attention which would lead it to believe that the Limited
Offering Memorandum (other than information herein related to DTC, the book -entry only system of
registration and the information contained under the caption "TAX MATTERS" as to which no opinion
will be expressed), as of its date and as of the date of delivery of the Series 2018 Bonds, contain an untrue
statement of a material fact or omits to state a material fact which should be included therein for the
purposes for which the Limited Offering Memorandum is intended to be used, or which is necessary to
make the statements contained therein, in the light of the circumstances under which they were made, not
misleading.
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THE CITY OF MIAMI, FLORIDA
By:
City Manager
010-8616-7788/4/AM ERICAS
APPENDIX A
GENERAL INFORMATION REGARDING THE CITY OF MIAMI
010-8616-7788/4/AM ERICAS
APPENDIX B
COPY OF THE ORIGINAL RESOLUTION AND FORM OF THE SERIES 2018 BONDS
RESOLUTION
010-8616-7788/4/AM ERICAS
APPENDIX C
BASIC FINANCIAL STATEMENTS OF THE CITY OF MIAMI
FOR FISCAL YEAR ENDED SEPTEMBER 30, 2017 (EXCERPT OF THE CITY OF MIAMI
COMPREHENSIVE ANNUAL FINANCIAL REPORT)
010-8616-7788/4/AM ERICAS
APPENDIX D
FORM OF BOND COUNSEL OPINION
010-8616-7788/4/AM ERICAS
APPENDIX E
FORM OF DISCLOSURE DISSEMINATION AGENT AGREEMENT
010-8616-7788/4/AM ERICAS
APPENDIX F
FORM OF INVESTOR LETTER
010-8616-7788/4/AM ERICAS
SUBSTITUTED
EXHIBIT "A"
FORM OF SERIES 2018 BOND
THIS BOND IS SUBJECT TO TRANSFER RESTRICTIONS. THE INITIAL P CHASER
HEREOF AND ANY SUBSEQUENT TRANSFEREE, BY PURCHASING THIS BO ' 4 D, AGREES
FOR THE BENEFIT OF THE CITY OF MIAMI, FLORIDA, THAT THIS BOND MAY BE
TRANSFERRED, RESOLD OR ASSIGNED ONLY TO ANOTH' QUALIFIED
INSTITUTIONAL BUYER. NOTWITHSTANDING ANYTHING IN THE ESOLUTION OR
THIS BOND TO THE CONTRARY, NO TRANSFER, RESALE OR AS
BOND SHALL BE EFFECTIVE UNLESS THE TRANSFER, RESALE
THIS BOND IS TO ANY PURCHASER, TRANSFEREE, ASSIGNEE
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN R
GNMENT OF THIS
R ASSIGNMENT OF
R PARTICIPANT THAT
E 144A PROMULGATED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. P41 TRANSFER, RESALE OR
ASSIGNMENT OR OTHER DISPOSITION OF THIS BO ►., OR ANY PARTICIPATION
HEREIN, SHALL BE IN EACH CASE ONLY IN A MANNE • T DOES NOT VIOLATE THE
SECURITIES ACT OF 1933, AS AMENDED, AND RULES AND REGULATIONS
PROMULGATED THEREUNDER. THIS BOND SHAL " BE ISSUED AND SOLD, AND MAY
ONLY BE TRANSFERRED, IN DENOMINATION OF $100,000 OR ANY INTEGRAL
MULTIPLE OF $5,000 IN EXCESS OF $100,000.
UNITED STATES S F AMERICA
STATE O• LORIDA
CITY OF AMI, FLORIDA
[TAXABLE] SPECIAL OBLIGATIO" [REVENUE AND] REFUNDING BONDS,
SE S 2018[A][B]
(STREET AND SIDE ALK IMPROVEMENT PROGRAM)
No.
Interest Rate
ok
Registered Owner:
Ma it Date
Ori tinal Issue Date CUSIP No.
Principal Amount: Dollars
City of ami, Florida (the "City"), for value received, promises to pay, but solely from
the sources an in the manner hereinafter provided, to the Registered Owner named above, or
registered a signs, on the Maturity Date set forth above (or earlier as hereinafter referred to)
upon pre-•ntation and surrender hereof, at the principal corporate trust office of
as Bond Registrar and Paying Agent, in the city of , Florida, or
its suc -ssors (the "Bond Registrar" and "Paying Agent") the Principal Amount set forth above
in an, coin or currency of the United States of America which on the date of payment thereof is
1e tender for the payment of public and private debts, and to pay in like coin or currency
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interest on said Principal Amount on each January 1 and July 1, commencing (:. ch an
"Interest Payment Date"), solely from such sources provided in the Resolution describ.: herein,
from the Interest Payment Date next preceding the date on which this Bond is a 4 enticated
unless it is (i) authenticated on an Interest Payment Date, in which event from suc date, or (ii)
authenticated before the first Interest Payment Date, in which event from its Orig'. al Issue Date,
at the Interest Rate set forth above until the Principal Amount hereof is pai.. The interest so
payable and punctually paid or duly provided for on any Interest Payment D te, as provided in
the Resolution hereinafter referred to, will be paid by check mailed to the p son in whose name
this Bond (or one or more Predecessor Bonds, as defined in the Resolu '.n) is registered at the
close of business on the fifteenth (15th) day of the month next preced. ; such Interest Payment
Date; provided, however, that any registered owner of Bonds in an . gregate principal amount
of at least $1,000,000 shall be entitled to have interest paid by w e transfer pursuant to the
provisions of the Resolution.
This Bond is one of a duly authorized series of spe' al obligation bonds of the City,
designated "[Taxable] Special Obligation [Revenue and] -funding Bonds, Series 2018[A][B]
(the "Bonds"), issued in the aggregate principal amount • $ under Resolution No. 07-
0586 adopted by the City on October 11, 2007, as s .plemented by Resolution No. 18-
adopted by the City on , 2018 (collectively, e "Resolution"), as the same may be
supplemented and amended from time to time. The : onds are being issued to provide funds to
refund certain outstanding [City of Miami, Florid. Special Obligation Bonds, Series 2007 (Street
and Sidewalk Improvement Program)] [City of ami, Florida Special Obligation Bonds, Series
2009 (Street and Sidewalk Improvement Progr .' )], [finance the cost of acquisition, construction
and improvement to certain streetscapes, r.: dways, drainage and appurtenances thereto] and
pay costs of issuance of the Bonds. Capital' ed terms not otherwise defined herein shall have the
meaning ascribed to such terms in the R-.olution.
The Bonds are limited obli . tions of the City payable solely from the Designated
Revenues (hereinafter referred to). either the faith and credit of the State of Florida nor the
faith and credit of any agency or +olitical subdivision thereof or of the City are pledged to the
payment of the principal of or he interest or redemption premium, if any, on this Bond. The
issuance of this Bond shall n• directly or indirectly or contingently obligate the State of Florida
or any agency or political s division thereof or the City to levy any taxes whatever therefor or
to make any appropriatio ' for their payment except from the funds pledged therefor.
ADD1TIONA ROVISIONS OF THIS BOND ARE SET FORTH ON THE REVERSE
HEREOF AND SH L FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH SET
FORTH HERE.
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IN WITNESS WHEREOF, the City of Miami, Florida has caused this Bond to be ecuted
with the [manual] [facsimile] signature of the City Manager and attested by its City C rk and [a
facsimile of] its official seal to be [impressed] [imprinted] hereon and this Bond to • - dated this
day of ,2018.
[SEAL] CITY OF MIAMI, FLO
corporation
Approved as to Insurance
Requirements:
By:
Risk Management Director
Approved as to Form
and Correctness TTEST:
[Manu
City
, a municipal
or Facsimile Signature
anager
City Attorney By:
[Manual or Facsimile Signature]
City Clerk
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CERTIFICATE OF AUTHENTICATION
This Bond is a bond issued under the provisions of the within -mentioned Resolution.
, Bond Re_'strar
Date of authentication:
By:
Authorized Sig' atory
fForm of Reverse of Bond
To secure the Bonds, the City has irrevocably pled ed the Designated Revenues under the
Resolution. The Designated Revenues consist of (a)(i) e City's portion of the Local Option Gas
Taxes, (ii) eighty percent (80%) of the City's portio of the Transportation Surtax, (iii) twenty
percent (20%) of the City's Parking Surcharge, and v) all investment income realized by reason
of the investment of moneys on deposit or creted to the Debt Service Fund whether such
investment income is deposited or credited to e Designated Revenues Fund or remains in the
Account in the Debt Service Fund where ear ' ed (any fees, commissions or charges established
pursuant to the laws of Florida or ordines or administrative orders of the City or County
which replace any of the items mentio d in clause (i), (ii) or (iii) shall be included in the
definition of Designated Revenues), an. (b) all moneys and investments, including investment
earnings thereon, held for the credit . the funds, accounts and subaccounts established under
the Resolution or any Series Resolu' on, other than the Rebate Fund and any accounts created
thereunder. The City has full po er and authority to pledge the Designated Revenues to the
payment of the principal of, inter • st and redemption premium, if any, on the Bonds.
Reference is made to the Resolution for a more complete statement of the provisions
thereof and of the rights .nd duties of the City and the registered owners. Copies of the
Resolution are on file an. may be inspected at the office of the City Clerk. By the purchase and
acceptance of this Bon., the Registered Owner hereof signifies assent to all of the provisions of
the Resolution.
This Bon
Constitution an
is issued and the Resolution was enacted under and pursuant to the
aws of the State of Florida.
The :•nds are issuable as fully registered Bonds in the denomination of $100,000 or any
integral m tiple of $5,000 in excess of $100,000.At the principal corporate trust office of the
Bond Re• istrar, in the manner and subject to the limitations and conditions provided in the
Resolu : on, Bonds may be exchanged for an equal aggregate principal amount of Bonds of the
same series and maturity, of any authorized denomination or denominations and bearing
int est at the same rate.
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The transfer of this Bond is registrable by the Registered Owner hereof in person • r by
his/her attorney or legal representative at the principal corporate trust office of th • Bond
Registrar, but only in the manner and subject to the limitations and conditions provi• d in the
Resolution and upon surrender and cancellation of this Bond. Upon any such re • ' tration of
transfer, the City shall execute and the Bond Registrar shall authenticate and delive in exchange
for this Bond a new Bond or Bonds, registered in the name of the transferee (w ich must be a
Qualified Institutional Buyer), of any authorized denomination or deno inations in an
aggregate principal amount equal to the principal amount of this Bond, of te same series and
maturity and bearing interest at the same rate. Neither the City nor the Bo d Registrar shall be
required to make any exchange or registration of transfer of any Bond . uring the fifteen (15)
days immediately preceding the date of the City's giving notice of re, -mption or purchase or
after such Bond has been selected for redemption or purchase.
[INSERT REDEMPTION PROVISIO S
At least thirty (30) days, but not more than sixty d s (60) before the redemption date of
any Bonds, whether such redemption is in whole or in • . rt, the City shall cause a notice of any
such redemption signed by the City to be mailed, fir class, postage prepaid, to all registered
owners of Bonds to be redeemed in whole or in part .ut any defect in such notice or the failure
so to mail any such notice to the registered owne of any Bond shall not affect the validity of
the proceedings for the redemption of any other : onds. On the date fixed for redemption, notice
having been mailed in the manner provided the Resolution and sufficient moneys having
been deposited with the Paying Agent or of r Depositary, the Bonds or portions thereof called
for redemption shall be due and payabl' at the redemption price provided therefor, plus
accrued interest to such date. If a portion if this Bond shall be called for redemption a new Bond
or Bonds in principal amount equal t' the unredeemed portion hereof will be issued to the
Registered Owner upon the surrende - ereof.
The owner of this Bond sh . I have no right to enforce the provisions of the Resolution or
to institute action to enforce t covenants therein, or to take any action with respect to any
event of default under the •solution, or to institute, appear in or defend any suit or other
proceeding with respect the -to, except as provided in the Resolution.
The Resolution p units the issuance of additional or refunding bonds secured on a parity
with the Bonds upo compliance with the conditions contained therein. Modifications or
alterations of the Re .lution, or any resolution supplemental thereto, may be made only to the
extent and in the ci umstances permitted by the Resolution.
This Bo ' d is issued with the intent that the laws of the State of Florida shall govern its
construction.
Al acts, conditions and things required to happen, exist and be performed precedent to
and in t ► e issuance of this Bond have happened, exist and have been performed as so required.
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This Bond shall not be valid or become obligatory for any purpose or be enti - ed to any
benefit or security under the Resolution until it shall have been authenticated by e execution
by the Bond Registrar of the certificate of authentication endorsed hereon.
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[Form of Assignment]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and trsfers unto
a
[Please Print or Typewrite Name, Tax Identification Number and Address of Tr.. sferee]
Qualified Institutional Buyer, the within Bond, and all rights thereun 4 er, and hereby
irrevocably constitutes and appoints attorney to
register the transfer of the within Bond on the books kept for registra ' •n thereof, with full
power of substitution in the premises.
Dated:
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N ' CE: The signature to this
signment must correspond with
the name as it appears upon the face
of the within bond in every
particular, without alteration or any
change whatever.
SUBSTITUTED
EXHIBIT "B"
DRAFT OF
PRELIMINARY LIMITED OFFERING MEMORANDUM