R-98-06-11-13C1 - 6/11/1998Mayor
Charles Culpepper
Mayor Pro-tem
Furl Primer
Connell Members
Robert Stluka
Rod Morgan
Rick Stewart
Martha awn
Army Joseph
City Manager
Robert L Bennett. Jr.
Qty Attorney
Stephan L Sheets
ITY OF ROUND ROCK
July 1, 1998
McCall, Parkhurst & Horton L.L.P.
Attn: Carol Polumbo
600 Congress Avenue, Suite 1250
Austin, Texas 78701 -3248
Dear Ms. Polumbo:
221 Fast Main Street
Round Rock, Texas 78664
512 -218 -5400
Enclosed are the signed documents concerning the Publication of Notice of Intention to
Issue City of Round Rock, Texas Combination Tax and Revenue Certificates of
Obligation, Series 1998.
If you need additional information, please do not hesitate to call.
Assistant City Secretary
Enclosure
Fax: 512,218-7097
1400- 735 -2989 TDD 1- 803- 735-2988 Voice
JUN -04 -9e 16.62 FROM.
THE STATE OF TEXAS §
CITY OF ROUND ROCK §
10.16124720871 PAGE 2/6
4 .
RESOLUTION DIRECTING THE PUBLICATION
OF NOTICE OF INTENTION TO ISSUE
CITY OF ROUND ROCK, TEXAS COMBINATION TAX
AND REVENUE CERTIFICATES OF OBLIGATION,
SERIES 1998; APPROVING A PRELIMINARY OFFICIAL STATEMENT;
AUTHORIZING DISTRIBUTION OF SUCH PRELIMINARY
OFFICIAL STATEMENT AND OTHER MATTERS RELATED THERETO
WHEREAS, the City Council (the "Council ") ofthe City of Round Rock, Texas (the "City")
finds that the payment in whole or in part of contractual obligations incurred or to be incurred for
public improvements within the City to wit; (1) construction, improvement and equipment of City
park and recreation facilities including construction, improvement and equipment of a recreation
center, sidewalks and (2) the payment ofprofessional services in connection therewith including legal,
fiscal, and engineering fees and the costs of issuance in connection with the Certificates described
below (the "Contractual Obligations") would be beneficial to the inhabitants of the City and are
needed to perform essential City functions; and
WHEREAS, the Council has deemed it advisable to give notice of intention to issue
certificates ofobligation in a maximum principal amount not to exceed S2,550.000 (the "Certificates ")
pursuant to the provisions ofthe Certificate of Obligation Act of 1971, Section 271.041 et seq., Local
Government Code (the "Act ") for the purpose of financing the Contractual Obligations; and
WHEREAS, prior to the issuance of the Certificates, the City is required under the Act to
publish notice of its intention to issue the Certificates once a week for two consecutive weeks in a
newspaper of general circulation in the City with the first publication to be at least 14 days before the
date tentatively set for passage of the Ordinance authorizing the Certificates, the notice stating: (i)
the time and place tentatively set for the passage of the ordinance authorizing the issuance of the
Certificates, (ii) the maximum amount and purpose of the Certificates to be authorized, and (iii) the
manner in which the Certificates will be paid; and
WHEREAS, in conjunction with the issuance of the Certificates, the City is also issuing
certain general obligation bonds (the "Bonds "); and
' WHEREAS, a substantially final draft of the Preliminary Official Statement in connection
with the issuance of the Certificates and Bonds has been presented to the Council; and
WHEREAS, the meeting at which this Resolution is adopted was open to the public and
public notice ofthe lime, place and purpose of the meeting was given, all as required by Chapter 551,
Texas Government Code, as amended.
JUN -04 -98 16.63 FROM
ID.16124720871
•
THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
ROUND ROCK, TEXAS:
1. Attached hereto as Exhibit "A" is a form of the Notice of Intention to issue the
Certificates, the form and substance of which is hereby adopted and approved.
2. The City Secretary or other authorized representatives of the City, shall cause the notice
to be published in substantially the form attached hereto, in a newspaper of general circulation in the
City, once a week on the same day in each of two consecutive weeks, the date of the first publication
to be at least 14 days prior to the time set for the ordinance authorizing issuance of the Certificates
as shown in the notice.
3. The City hereby approves the Preliminary Official Statement substantially in the form
attached hereto as Exhibit 'B" with such changes, additions or deletions as directed by the City. The
City's Financial Advisor is hereby authorized to distribute the Preliminary Official Statement to
potential purchasers and to do all things necessary to market the Certificates and Bonds including
making application to the various rating agencies and bond insurance companies.
4. This Resolution shall become effective immediately upon adoption. The Mayor and City
Secretary are hereby authorized and directed to execute the certificate to which this Resolution is
attached on behalf of the City and to do any and all things proper and necessary to carry out the invent
of this Resolution.
2
PAGE 3/6
JUN -04 -99 16.63 FROM.
EXHIBIT "A"
NOTICE OF INTENTION TO ISSUE
CERTIFICATES OF OBLIGATION
ID.16124720971 PAG& 4/6
NOTICE IS HEREBY G1VEN that it is the intention of the City Council of the City of
Round Rock, Texas, to issue interest bearing certificates of obligation of the City entitled "City of
Round Rock, Texas Combination Tax and Revenue Certificates of Obligation, Series 1998," for the
purpose of paying contractual obligations incurred or to be incurred by the City for public
improvements within the City to wit: (1) construction, improvement and equipment of City park and
recreation facilities including construction, improvement and equipment of a recreation center,
sidewalks and (2) the payment of professional services in connection therewith including legal, fiscal,
and engineering fees and the costs of issuance in connection with the Certificates. The City Council
tentatively proposes to authorize the issuance of such Certificates of Obligation at its regular meeting
place in the City Hall, 221 E. Main Street, Round Rock, Texas 78664, at a meeting to commence at
7:00 p.m., on the 9th day of July, 1998. The maximum amount of Certificates of Obligation that may
be authorized for such purpose is $2,550,000. The City Council presently proposes to provide for
the payment of such Certificates of Obligation from the levy of ad valorem taxes and from a limited
pledge of surplus revenues derived from the operation ofthe City's combined waterworks and sewer
system.
neencotcTmffimeuq
CITY OF ROUND ROCK, TEXAS
!s/ Charles Culpepper
Mayor
JUN -04 -99 16.63 FROM
IIMCC112morn112612a14w 4
EXHIBIT "B"
Preliminary Official Statement
1D.16124720971 PAGE 5/6
NOTICE OF SALE
AND
BIDDING INSTRUCTIONS
ON
S8,9I0,009
CITY OF ROUND ROCK, TEXAS
(Williamson and Travis Counties)
GENERAL OBLIGATION BONDS, SERIES 1998
Sealed Bids Due Thursday, July 9, 1998, at 4:00 PM. CDT
THE SALE
Bonds Offered for Sale at Competitive Bidding ... City of Round Rock, Texas (the "City") is offering for sale its
$8,910,000 General Obligation Bonds, Series 1998 (the "Bonds")
Address of Bids/Bids Delivered In Person ... Sealed bids, plainly marked `Bid for Bonds ", should be addressed to
"Honorable Mayor and City Council, City of Round Rock, Texas", and, if delivered in person, taken to the office of the
Director of Finance at City Ilall, 221 East Main Street, Round Rock, Texas 78664 prior to 4:00 PM, CDT, on the date of the
bid opening. All bids must be submitted on the Official Bid Form, without alteration or interlineation. Copies of the Official
Bid Form accompany the Official Statement
Bids by Telephone or Facsimile ... Bidders that choose to exercise the telephone or facsimile bidding options must submit
SIGNED Official Bid Forms to Garry Kimball, First Southwest Company, 98 San Jacinto Blvd., Suite 370, Austin, Texas,
78701, and submit their bid by telephone or facsimile (fax) on the date of the sale.
Telephone bids will be accepted at (512) 481 -2000, between 3:00 PM, CDT and 4:00 PM, CDT on the date of salt.
Fax bids will be received between 3:00 PM, CDT and 4:00 PM, CDT on the date of the sale at (512) 481 -2010, attention
Garry Kimball.
First Southwest Company will not be responsible for submitting any bids received after the above deadlines.
The City and First Southwest Company are not responsible if such facsimile or telephone numbers are busy or malfunctioning
which prevents a bid or bids from being submitted on a timely basis. The City and First Southwest Company will not be
responsible for submitting any bids received after the above deadlines. First Southwest Company and the City assume no
responsibility or liability with respect to any irregularities associated with the submission of bids if telephone or fax options are
exercised.
Place and Time of Bld Opening and Award ... The bids for the Bonds will be publicly opened, read and awarded in the
City Council Chambers at 7:00 PM, CDT, Thursday, July 9, 1998,
THE BONDS
Description ... The Bonds will be dated July 1, 1998 (the "Bond Date"), and interest will be due on August 15, 1998, and
each February 15 and August 15 thereafter until the earlier of maturity or prior redemption. The Bands will be issued only in
fully registered form in any integral multiple of $5,000 for any one maturity. The Bands will mature on August 15 in each year
as follows:
MATURITY SCHEDULE
Principal Principal papal
Year Amount Year Amount Year Amount
1999 $ 75,000 2.008 $ 225,000 2016 $ 360,000
2000 30,000 2009 240,000 2017 370,000
2001 35,000 2010 300,000 2018 360,000
2002 40,000 2011 310,000 2019 380,000
2003 45,000 2012 320,000 2020 400,000
2004 50,000 2013 330,000 2021 425,000
2005 55,000 2014 340,000 2022 1,780,000
2006 60,000 2015 350,000 2023 1,830,000
2007 200,000
Bidders have the right to designate one or more maturity dates for the bonds on or after August 15, 2008 as serial or
term bonds; however, no more than two dates can be designated as maturity dates for term bonds. No maturity of any
serial bond shall be scheduled to occur on or after the date of the fast sinking fund installment on any term bond. No sinking
fund installment with respect to any term bond shall be due on or prior to the date of the final maturity of any earlier maturity
test bond. The amount of term bonds, if any, maturing on each maturity date shall equal the sum of (i) the installment
specified above for such maturity date and (ii) the installments specified above preceding such date (and subsequent to any
earlier final maturity date of another specified term bond, and the term bonds of such maturity sball be retired utilizing such
installments and sinking fund installments at par plus accrued interest_ If and to the extent the successful bidder specifics for
the bonds a maturity date or dates of August 15, 2008 and consecutive subsequent years, the City will issue such bonds as
serial bonds maturing on such date or dates in amounts in accordance with the foregoing respective schedules. The balance of
such bonds, if any, shall be issued as term bonds as designated by the successful bidder.
Book- Entry-Only System ... The City intends to utilize the Book - Entry-Only System of The Depository Trust Company
( "DTC "). See "BOND AND CERDYICATE INFORMATION - Book- Entry-Only System" in the Official Statement.
Redemption ... The City reserves the right, at its option, to redeem Bonds having stated maturities on and after August 15,
2009, in whole or from time to time in part in principal amounts of $5,000 or any integral multiple thereof, on August 15, 2008,
or any date thereafter, at the par value thereof plus accrued interest to the date fixed for redemption.
Paying Agent/Registrar ... The initial Paying Agent/Registrar shall be Chase Bank of Texas, National Association (see
"BOND AND CERTIFICATE INFORMATION - Paying Agent/Registrar" in the Official Statement).
Source of Payment ... The Bonds are direct and voted general obligations of the City of Round Rock, Texas, payable out of
the receipts from an ad valorem tax levied, within the limits prescribed by law, on all taxable property located within the City,
as provided in the Ordinance.
Further details regarding the Bonds are set forth in the Official Statement
CONDITIONS OF TIIE SALE
11
•
Type of Bids and Interest Rates ... The Bonds will be sold in one block on an "All or None" basis, and at a price of not less
than their par value plus accrued interest from the date of the Bonds to the date of delivery of the Bonds. Bidders are invited to
name the rate(s) of interest to be borne by the Bonds, provided that each rate bid must be in a multiple of 1/8 of 1% or 1/20 of
1% and the net effective intenest rate must not exceed 15 %. The highest rate bid may not exceed the lowest rate bid by more
than 2% in rate. No limitation is imposed upon bidders as to the number of rates or changes which may be used. All Bonds of
one maturity must bear one and the same rate. No bids involving supplemental interest rates will be considered.
Basis for Award ... The sale of the Bonds will be awarded to the bidder making a bid that conforms to the specifications
herein and which produces the lowest True Intuit Cost rate to the City. The True Interest Cost rate is that rate which, when
used to compute the total present value as of the Dated Date of all debt service payments on the Bonds on the basis of semi-
annual compounding, produces an amount equal to the sum of the par value of the Bonds plus any premium bid (but not
interest accrued from the Dated Date to the date of their delivery). In the event of a bidder's error in interest cost rate
calculations, the interest rates, and premium, if any, set forth in the Official Bid Form will be considered as the official bid.
Good Faith Deposit ... A Goal Faith Deposit, payable to the "City of Round Rock, Texas ", in the amount of $178,200, is
required. Such Good Faith Deposit shall be a bank cashier's check or certified check, which is to be retained uncashed by the
City pending the Purchaser's compliance with the terms of the bid and the Notice of Sale and Bidding Instructions. The Good
Faith Deposit may accompany the Official Bid Form or it may be submitted separately. If submitted separately, it shall be
made available to the City prior to the opening of the bids, and shall be accompanied by instructions from the bank an which
drawn which authorize its use as a Good Faith Deposit by the Purchaser who shall be named in such instructions. The Good
Faith Deposit of the Purchaser will be returned to the Purchaser upon payment for the Bonds. No interest will be
allowed on the Good Faith Deposit In the event the Purchaser should fail or refuse to take up and pay for the Bonds in
accordance with the bid, then said check shall be cashed and accepted by the City as full and complete liquidated damages. The
checks accompanying bids other than the winning bid will be returned immediately after the bids are opened, and an award of
the Bonds has been made.
DELIVERY OF THE BONDS AND ACCOMPANYING DOCUMENTS
CUSIP Numbers ... R is anticipated that CUSIP identification numbers will appear an the Bonds, but neither the failure to
print or type such number an any Bond nor any error with respect thereto shall constitute cause for a failure or refusal by the
Purchaser to accept delivery of and pay for the Bonds in accordance with the terms of this Notice of Sale and Bidding
Instructions and the terms of the Official Bid Form. All expenses in relation to the printing or typing of CUSIP numbers on the
Bonds shall be paid by the City, provided, however, that the CUSIP Service Bureau charge for the assignment of the numbers
shall be the responsibility of and shall be paid for by the Purchaser.
Delivery of Bonds ... Initial Delivery will be accomplished by the issuance of one Bond per maturity (the "Initial Bonds"),
either in typed or printed form, signed by the Mayor and City Secretary, approved by the Attorney General, and registered and
manually signed by the Comptroller of Public Accounts. Upon delivery of the Initial Bonds, they shall be immediately canceled
and one definitive Bond for each maturity will be registered and delivered only to Cede & Co., and deposited with DTC in
connection with DTC's Book - Entry-Only System. Delivery will be at the office of the Paying Agent/Registrar in Austin, Texas.
Payment for the Bonds must be made in immediately available funds for unconditional credit to the City, or as otherwise
directed by the City. The Purchaser will be given six business days' notice of the time fixed for delivery of the Bonds. It is
anticipated that delivery of the Bond(s) can be made on or about August 18, 1998, and it is understood and agreed that the
Purchaser will accept delivery and make payment for the Bonds by 10:00 AM, CDT, on August 18, 1998, or thereafter on the
date the Bond is tendered for delivery, up to and including September 1, 1998. If for any reason the City is unable to make
delivery on or before September 1, 1998, the City shall immediately contact the Purchaser and offer to allow the Purchaser to
extend its offer for an additional thirty days. If the Purchaser does not elect to extend its offer within six days thereafter, then
its Good Faith Deposit will be returned, and both the City and the Purchaser shall be relieved of any further obligation. In no
event shall the City be liable for any damages by reason of its failure to deliver the Bonds, provided such failure is due to
circumstances beyond the City's reasonable control.
Conditions to Delivery ... The obligation of the Purchaser to lake up and pay for the Bonds is subject to the Purchaser's
receipt of (a) the legal opinion of McCall, Parkhurst & Horton L.L.P., Austin, Texas, Bond Counsel for the City ( "Bond
Counsel "), (b) the no- litigation Certificate, and (c) the certification as to the Official Statement, all as further described in the
Official Statement.
In order to provide the City with information required to enable it to comply with certain conditions of the Internal Revenue
Code of 1986 relating to the exemption of interest on the Bonds from the gross income of their owners, the Purchaser will be
required to complete, execute, and deliver to the City (on or before the 6th business day prior to the delivery of the Bonds) a
certification as to their "issue price" substantially in the form and to the effect attached hereto or accompanying this Notice of
Sale and Bidding Instructions. In the event the successful bidder will not reoffer the Bonds for sale, such Bond may be
modified in a manner approved by the City. In no event will the City fail to deliver the Bonds as a result of the Initial
Purchaser's inability to sell a substantial amount of the Bonds at a particular price prior to delivery. Each bidder, by
submitting its bid, agrees to complete, execute, and deliver such a Bond by the 6 business day prior to the date of delivery of
the Bonds, if its bid is accepted by the City. It will be the responsibility of the Purchaser to institute such syndicate reporting
requirements to make such investigation, or otherwise to ascertain the facts necessary to enable it to make such certification
with reasonable certainty. Any questions concerning such certification should be directed to Bond Counsel.
Legal Opinions ... The Bonds are offered when, as and if issued, subject to the approval of the Attorney General of the State
of Texas. Delivery of and payment for the Bonds is subject to the receipt by the Purchaser of opinions of Bond Counsel, to the
effect that the Bonds are valid and binding obligations of the City and that the interest on the Bonds will be excludable from
gross income for federal income tax purposes under existing law, subject to the matters described under 'TAX MATTERS" in
the Official Statement, including the alternative minimum tax on corporations.
Certification of Official Statement ... At the time of payment for and Initial Delivery of the Bonds, the City will execute and
deliver to the Purchaser a Certificate in the form set forth in the Official Statement
Change In Tax Exempt Status ....At any time before the Bonds are tendered for delivery, the Purchaser may withdraw its
bid if the interest received by private holders on bonds of the same type and character shall be declared to be taxable income
under present federal income tax laws, either by ruling of the Internal Revenue Service or by a decision of any Federal court, or
shall be declared taxable or be required to be taken into =omit in computing any federal income taxes, by the terms of any
federal income tax law enacted subsequent to the date of this Notice of Sale and Bidding Instructions.
GENERAL
Financial Advisor ... First Southwest Company is employed as Financial Advisor to the City in connection with the issuance
of the Bonds. The Financial Advisor's fee for services rendered with respect to the sale of the Bonds is contingent upon the
issuance and delivery of the Bonds. First Southwest Company may submit a bid for the Bonds, either independently or as a
member of a syndicate organized to submit a bid for the Bonds. First Southwest Company, in its capacity as Financial Advisor,
has relied on the opinion of Bond Counsel and has not verified and does not assume any responsibility for the information,
covenants and representations contained in any of the legal documents with respect to the federal income tax status of the
Bonds, or the possible impact of any present, pending or future actions taken by any legislative or judicial bodies.
Blue Sky Laws ... By submission of its bid, the Purchaser represents that the sale of the Bonds in states other than Texas will
be made only pursuant to exemptions from registration or, where necessary, the Purchaser will register the Bonds in accordance
with the securities law of the states in which the Bonds are offered or sold. The City agrees to cooperate with the Purchaser, at
the Purchaser's written request and expense, in registering the Bonds or obtaining an exemption from registration in any state
where such action is necessary, provided, however, that the City shall not be obligated to execute a general or special consent
to service of process or qualify to do business in any such jurisdiction.
Not an Offer to Sell ... This Notice of Sale and Bidding Instructions does not alone constitute an offer to sell the Bonds, but
is merely notice of the sale of the Bonds. The offer to sell the Bonds is being made by means of the Notice of Sale and Bidding
Instructions, the Official Bid Form and the Official Statement. Prospective purchasers are urged to carefully examine the
Official Statement to determine the investment quality of the Bonds.
Issuance of Additional Debt .. .The City is issuing $2,550,000 City of Round Rock, Texas Combination Tax & Revenue
Certificates of Obligation, Series 1998, simultaneously, with the issuance of the Bonds.
Ratings ... The presently outstanding tax supported debt of the City is rated "Aa3" by Moody's Investors Service, Inc.
( "Moody's ") and "A +" by Standard & Poor's Ratings Group, A Division of McGraw -Hill ( "S&P "). Insured fax supported debt
of the City is rated "Aaa" by Moody's and "AAA" by S &P. Applications for contract ratings on this issue have been made to
both Moody's and S&P. The results of their determinations will be provided as soon as possible.
Municipal Bond Insurance ... In the event the Bonds are qualified for municipal bond insurance, and the Purchaser desires
to purchase such insurance, the cost therefor will be paid by the Purchaser. Any fees to be paid to the rating agencies as a
result of said insurance will be pald by the City. It will be the responsibility of the Purchaser to disclose the existence of
iasurance, its terms and the effect thereof with respect to the reoffering of the Bonds.
The Official Statement and Compliance with SEC Rule 15c2 -12 .. The City has prepared the accompanying Official
Statement and, for the limited purpose of complying with SEC Rule 15c2 -12, deems such Official Statement to be final as of its
date within the meaning of such Rule for the purpose of review prior to bidding. To the best knowledge and belief of the City,
the Official Statement contains information, including financial information or operating data, concerning every entity,
enterprise, fund, account, or person that is material to an evaluation of the offering of the Bonds. The City has not failed to
comply with any previous continuing disclosure undertaking in a written contract or agreement specified in SEC Rule 15c2-
12(bX5)(i). Representations made and to be made by the City concerning the absence of material misstatements and omissions
in the Official Statement are addressed elsewhere in this Notice of Sale and Bidding Instructions and in the Official Statement
The City will furnish to the Purchaser, or Purchasers, acting through a designated senior representative, in accordance with
instructions received from the Purchaser(s), within seven (7) business days from the sale date an aggregate of 100 copies of the
Official Statement including a like number of copies of any Supplement(s) reflecting interest rates and other terms relating to
the initial reoffering of the Bonds. The cost of a reprinted Official Statement, if the Purchaser(s) shall so elect, and the cost of
any Official Statement in excess of the number specified shall be prepared and distributed at the cost of the Purchaser(s). The
Purchaser(s) shall be responsible for providing in writing the initial reoffering prices and other terms, if any, to the Financial
Advisor by the close of the next business day after the award. Except as noted above, the City assumes no responsibility or
obligation for the distribution or delivery of any copies of the Official Statement in connection with the offering or reoffering of
the subject securities.
Continuing Disclosure Agreement ... The City will agree in the Ordinance to provide certain periodic information and
notices of material events in accordance with Securities and Exchange Commission Rule 15c2 -12, as described in the Official
Statement under "CONTINUING DISCLOSURE OF INFORMATION ". The Purchaser(s') obligation to accept and pay for the
Bonds is conditioned upon delivery to the Purchaser(s) or ( their) agent of a certified copy of the Ordinance containing the
agreement described under such head See "CONTINUING DISCLOSURE OF INFORMATION" in the Official Statement
Additional Copies of Notice, Bid Form and Statement ... A limited number of additional copies of this Notice of Sale and
Bidding Instructions, the Official Bid Form and the Official Statement, as available over and above the normal mailing, may be
iv
obtained at the offices of First Southwest Company, Investment Bankers, 1700 Pacific Avenue, Suite 500, Dallas, Texas 75201,
Financial Advisor to the City.
On the date of the sale, the City will, in the Ordinance authorizing the issuance of the Bonds, confirm its approval of the form
and content of the Official Statement, and any addenda, supplement or amendment thereto, and authorize its use in the
reoffering of the Bonds by the Purchaser.
CHARLES C. CULPEPPER
Mayor
City of Round Rock, Texas
ATTEST:
JOANNE LAND
City Secretary
June 11, 1998
v
Honorable Mayor and City Council
City of Round Rock, Texas
OFFICIAL BID FORM
Members of the City Council:
Reference is made to your Official Statement and Notice of Sale and Bidding Instructions, dated June 11, 1998 of $8,910,000 CITY OF
ROUND ROCK, TEXAS GENERAL OBLIGATION BONDS, SERIFS 1998, both of which constitute a part hereof.
For your legally issued Bonds, as described in said Notice of Sale and Bidding Instructions and Official Statement, we will pay you par
and accrued interest from date of issue to date of delivery to us, plus a cash premium of $ for Bonds maturing and
bearing interest as follows:
Maturity Principal Interest Serial Mandatory Sinking
8-15 Amount Rate Amount Fund installment
1999 $ 75,000 %
2000 30,000 %
2001 35,000
2002 40,000 %
2003 45,000 %
2004 50,000 %
2005 55,000
2006 60,000
2007 200,000
2008 225,000 %
2009 240.000
2010 300,000
2011 310.000 %
2012 320,000
2013 330,000
2014 340,000
2015 350,000 %
2016 360,000
2017 370,000 %
2018 360,000
2019 380,000
2020 400,000
2021 425,000
2022 1,780,000 %
2023 1,830,000 %
Our calculation (which is not a part of this bid) of the interest cost from the above is:
July 9, 1998
TRUE INTEREST COST $
The mandatory sinking fund installments checked above, if any, shall be applied for the redemption oftmm bonds maturing as fellows:
Term Bond Year of First Principal
Maturity Date Mandatory Amount of Interest
August 15 Redemption Term Bond Rate
0 /4
%
We are having the Bonds of the following maturities insured by
at a premium of said premium to be paid by the Purchaser.
Any fees to be paid to the rating agencies as a result of said insurance will be paid by the Clty.
The Initial Bonds shall be registered in the name of , which will, upon payment
for the Bonds, be canceled by the Paying Agent/Registrar. The Bonds will then be registered in the name of Cade & Co. (DTC's
partnership nominee), under the Book- Entry-Only System.
A bank cashier's check or certified check of the Bank, in the amount of
9178,200, which represents our Good Faith Deposit (is attached hereto) or (has been made available to you prior to the opening of this
bid), and is submitted in accordance with the terms as set forth in the Official Statement and Notice of Sale and Bidding Instructions.
We agree to accept delivery of the Bonds utilizing the Book - Entry-Only System through DTC and make payment for the Initial Bonds in
immediately available funds in the Corporate Trust Division, Chase Bank of Texas, National Association, Austin, Texas, not later than
10:00 AM, CDT, on August 18, 1998, or thereafter on the date the Bonds are tendered for delivery, pursuant to the terms sot forth in the
Notice of Sale and Bidding Instructions.
The undersigned agrees to complete, execute, and deliver to the City, at least six business days prior to delivery of the Bonds, a Certificate
relating to the "issue price" of the Bonds in the form and to the effect accompanying the Notice of Sale and Bidding Instructions, with such
changes thereto as may be acceptable to the City.
We agree to provide In writing the initial reoffering prices and other terms, if any, to the Financial Advisor by the close of the next
business day after the award.
Respectfully submitted. Syndicate Members:
Name of Underwriter or Manager
Authorized Representative
Phone Number
ACCEPTANCE CLAUSE
The above and foregoing bid is hereby in all thins accepted by the City of Round Rock, Texas, subject to and in accordance with the
Notice of Sale and Bidding Instructions, this the 9 day of July, 1998.
ATTEST:
City Secretary
Mayor
City of Round Rock, Texas
CERTIFICATE OF UNDERWRITER
The undersigned hereby certifies as follows with respect to the sale of $8,910,000 crrf OF ROUND ROCK, TEXAS
GENERAL OBLIGATION BONDS, SERIES 1998 (the "Bonds ").
1. The undersigned is the underwriter or the manager of the syndicate of underwriters which has purchased the
Bonds from the City of Round Rock, Texas (the "City") at competitive sale.
2. The undersigned and/or one or more other members of the rmderwriting syndicate, if any, have made a bona fide
offering of the Bonds of each maturity to the public.
3. The initial offering price (expressed as a yield) for the Bonds of each maturity at which a substantial amount of
the Bonds of such maturity was sold to the public is as set forth below.
Principal Principal Principal
Amount Year of Amount Year of Amount Year of
Maturing Maturity Yield Maturing Maturity Yield Maturing Maturity Yield
$ 75,000 1999 % $ 225,000 2008 % $ 360,000 2016
30,000 2000 % 240,000 2009 % 370,000 2017
35,000 2001 % 300,000 2010 % 360,000 2018 %
40,000 2002 % 310,000 2011 % 380,000 2019 %
45,000 2003 % 320,000 2012 % 400,000 2020
50,000 2004 % 330,000 2013 % 425,000 2021 %
55,000 2005 % 340,000 2014 % 1,780,000 2022 %
60,000 2006 % 350,000 2015 % 1,830,000 2023 %
200,000 2007 %
4. The term "public ", as used herein, means persons other than bondhouses, brokers, dealers, and similar persons or
organizations acting in the capacity of underwriters or wholesalers.
5. The offering prices (yields) described above reflect current market prices at the time of such sales.
6. The undersigned and/or one or more other members of the underwriting syndicate, as the case may be, (haveXhave not)
purchased bond insurance for the Bonds. The bond insurance, if any, has been purchased from
(the "Insurer") for a premium cost of $ (net of any nonguarantee cost, e.g., rating agency
fees). The amount of such cost is set forth in the Insurer's commitment and is separately stated from all fees or charges
payable to the Insurer. The premium does not exceed a reasonable charge for the transfer of credit risk taking into account
payments charged by guarantors in comparable transactions (including transactions in which a guarantor has no
involvement other than as a guarantor). The present value of the debt service savings expected to be realized as a result of
such insurance, discounted at a rate equal to the yield on the Bonds which results after recovery of the insnronee premium,
exceeds the present value of the bond insurance premium.
7. The undersigned understands that the statements made herein will be relied upon by the City in its effort to comply
with the conditions imposed by the Internal Revenue Code of 1986 on the exclusion of interest on the Bonds from the
gross income of their owners.
EXECUTED and DELIVERED this day of 1998.
(Name of Underwriter or Manager)
By
(Title)
NOTICE OF SALE
AND
BIDDING INSTRUCTIONS
ON
$2,550,000
CITY OF ROUND ROCK, TEXAS
(Williamson and Travis Counties)
COMBINATION TAX AND REVENUE
CERTIFICATES OF OBLIGATION, SERIES 1998
Sealed Bids Due Thursday, July 9, 1998, at 4:00 PM, CDT
THE SALE
Certificates Offered for Sale at Competitive Bidding ... The City of Round Rock, Texas (the "City") is offering for sale its
$2,550,000 Combination Tax and Revenue Certificates of Obligation, Series 1998 (the "Certificates").
Address of Bids/Bids delivered in Person ... Scaled bids, plainly marked `Bid for Certificates ", should be addressed to
"Honorable Mayor and City Council, City of Round Rock, Texas ", and if delivered in person to the office of Director of
Finance at City Hall, 221 East Main Street, Round Rock, Texas 78664 prior to 4:00 PM, CDT, on the date of the bid opening.
All bids must be submitted on the Official Bid Form, without alteration or interlincation. Copies of the Official Bid form
accompany the Official Statement.
Bids by Telephone or Facsimile ... Bidders that choose to exercise the telephone or facsimile bidding options must submit
SIGNED Official Bid Forms to Garry Kimball, First Southwest Company, 98 San Jacinto Blvd., Suite 370, Austin, Texas
78701, and submit their bid by telephone or facsimile (fax) on the date of the sale.
Telephone bids will be accepted at (512) 481 -2000, between 3:00 PM, CDT and 4:00 PM, CDT on the date of sale.
Fax bids must be received between 3:00 PM, CDT and 4:00 PM, CDT on the date of the sale at (512) 481 -2010, attention:
Garry Kimball.
First Southwest Company will not be responsible for submitting any bids received after the above deadlines.
The City and First Southwest Company are not responsible if such facsimile or telephone numbers are busy or malfunctioning
which prevents a bid or bids from being submitted on a timely basis. The City and First Southwest Company will not be
responsible for submitting any bids received after the above deadlines. First Southwest Company and the City assumes no
responsibility or liability with respect to any irregularities associated with the submission of bids if telephone or fax options are
exercised.
Place and Time of Bld Opening and Award ... The bids for the Certificates will be publicly opened, read and awarded in
the City Council Chambers at 7:00 PM, CDT, Thursday, July 9, 1998.
THE CERTIFICATES
Description ... The Certificates will be dated July 1, 1998 (the "Dated Date"), and interest will be due on August 15, 1998,
and each February 15 and August 15 thereafter until the earlier of maturity or prior redemption. The Certificates will be issued
only in fully registered form in any integral multiple of $5,000 for any one maturity. The Certificates will mature an August 15
in each year as follows:
MATURITY SCHEDULE
Principal Principal Principal
Year Amount Year Amount Year Amount
1999 $ 75,000 2006 $ 105,000 2013 $ 155,000
2000 80,000 2007 115,000 2014 160,000
2001 85,000 2008 120,000 2015 170,000
2002 90,000 2009 125,000 2016 180,000
2003 90,000 2010 130,000 2017 190,000
2004 95,000 2011 140,000 2018 200,000
2005 100,000 2012 145,000
Bidders have the right to designate one or more maturity dates for the bonds on or after August 15, 2008 as serial or
term certificates; however, no more than two dates can be designated as maturity dates for term certificates. No
maturity of any serial certificate shall be scheduled to occur on or after the date of the fast sinking fund installment on any tens
certificate. No sinking fund installment with respect to any teen certificate shall be due on or prior to the date of the final
maturity of any earlier maturity term certificate. The amount of term certificates, if any, maturing on each maturity date shall
equal the sum of (i) the installment specified above for such maturity date and (ii) the installments specified above preceding
such date (and subsequent to any earlier final maturity date of another specified term certificate, and the term certificates of
such maturity shall be retired utilizing such installments and sinking fund installments at par plus accrued interest. If and to
the extent the successful bidder specifies for the certificates a maturity date or dates of August 15, 2008 and consecutive
subsequent years, the City will issue such certificates as serial certificates maturing on such date or dates in amounts in
accordance with the foregoing respective schedules. The balance of such certificates, if any, shall be issued as term certificates
as designated by the successful bidder.
Book- Entry-Only System ... The City intends to utilize the Book - Entry-Only System of The Depository Trust Company
( "DTC "). See `BOND AND CERTIFICATE INFORMATION - Book- Entry-Only System" in the Official Statement.
Redemption ... The City reserves the right, at its option, to redeem Certificates having stated maturities on and after August
15, 2009, in whole or from time to time in part in principal amounts of $5,000 or any integral multiple thereof, on August 15,
2008, or any date thereafter, at the par value thereof plus accrued interest to the date fixed for redemption.
Paying Agent/Registrar ... The initial Paying Agent/Registrar shall be Chase Bank of Texas, National Association (see
"BOND AND CERTIFICATE INFORMATION - Paying Agent/Registrar" in the Official Statement).
Source of Payment... The Certificates constitute direct obligations of the City, payable from a combination of (i) the levy and
collection of a direct and continuing ad valorem tax, within the limits prescribed by law, on all taxable property within the City,
and (ii) a limited pledge of surplus net revenues of the City's Water and Wastewater System, as provided in the Ordinance.
Further details regarding the Certificates are set forth in the Official Statement.
CONDITIONS OF THE SALE
Type of Bids and Interest Rates ... The Certificates will be sold in one block on an "All or None" basis, and at a price of not
less than their par value plus accrued interest from the date of the Certificates to the date of delivery of the Certificates.
Bidders are invited to name the rate(s) of interest to be borne by the Certificates, provided that each rate bid must be in a
multiple of 1/8 of 1% or 1/20 of 2% and the net effective interest tale must not exceed 15 %. The highest rate bid may not
exceed the lowest rate bid by more than 2% in rate. No limitation is imposed upon bidders as to the number of rates or
changes which may be used. All Certificates of one maturity must bear one and the same rate. No bids involving supplemental
interest rates will be considered.
Basis for Award ... The sale of the Certificates will be awarded to the bidder making a bid that conforms to the specifications
herein and which produces the lowest True Interest Cost rate to the City. The True Interest Cost rate is that rate which, when
used to compute the total present value as of the Dated Date of all debt service payments on the Certificates on the basis of
semi - annual compounding, produces an amount equal to the sum of the par value of the Certificates plus any premium bid, if
any (but not interest accrued from the Dated Date to the date of their delivery). In the event of a bidder's error in interest cost
rate calculations, the interest rates, and premium, if any, set forth in the Official Bid Form will be considered as the intended
bid.
Good Faith Deposit ... A Good Faith Deposit, payable to the "City of Round Rock, Texas", in the amount of $51,000, is
required. Such Good Faith Deposit shall be a bank cashier's check or certified check, which is to be retained =cashed by the
City pending the Purchaser's compliance with the terms of inc bid and inc Notice of Sale and Bidding Instructions. The Good
Faith Deposit may accompany the Official Bid Form or it may be submitted separately. If submitted separately, it shall be
made available to the City prior to the opening of the bids, and shall be accompanied by instructions from the bank on which
drawn which anti, s its use as a Good Faith Deposit by the Purchaser who shall be earned in such instruction& The Good
Faith Deposit of the Purchaser will be returned to the Purchaser upon payment for the Certificates. No interest will be
allowed on the Good Faith Deposit. In the event the Purchaser should fail or refuse to take up and pay for the Certificates in
accordance with the bid, then said check shall be cashed and accepted by the City as full and complete liquidated damages.
The checks accompanying bids other than the winning bid will be returned immediately after the bids are opened, and an award
of the Certificates has been made.
u
DELIVERY OF THE CERTIFICATES AND ACCOMPANYING DOCUMENTS
CUSIP Numbers ... I1 is anticipated that CUSIP identification numbers will appear on the Certificates, but neither the failure
to print or type such number on any Certificate nor any error with respect thereto shall constitute muse for a failure or refusal
by the Purchaser to accept delivery of and pay for the Certificates in accordance with the terms of this Notice of Sale and
Bidding Instructions and the terms of the Official Bid Form. All expenses in relation to the printing or typing of CUSIP
numbers on the Certificates shall be paid by the City, provided, however, that the CUSIP Service Bureau charge for the
assignment of the numbers shall be the responsibility of and shall be paid for by the Purchaser.
Delivery of Certificates ... Initial Delivery will be accomplished by the issuance of one Initial Certificate per maturity (also
called the "Certificate" or "Certificates"), either in typed or printed form, in the aggregate principal amount of 52,550,000,
payable in stated installments to the Purchaser, signed by the Mayor and City Secretary, approved by the Attomey General, and
registered and manually signed by the Comptroller of Public Accounts. Upon delivery of the Initial Certificates, they shall be
immediately canceled and one definitive Certificate for each maturity will be registered and delivered only to Cede & Co., and
deposited with DTC in connection with DTC's Book- Entry-Only System. Delivery will be at the corporate trust office of the
Paying Agent/Registrar in Austin, Texas. Payment for the Certificates must be made in immediately available funds for
unconditional credit to the City, or as otherwise directed by the City. The Purchaser will be given six business days' notice of
the time fixed for delivery of the Certificates. It is anticipated that delivery of the Certificate(s) can be made on or about
August 18, 1998, and it is understood and agreed that the Purchaser will accept delivery and make payment for the Certificates
by 10:00 AM, CDT, on August 18, 1998, or thereafter on the date the Certificate is tendered for delivery, up to and including
September 1, 1998. If for any reason the City is unable to make delivery on or before September 1, 1998, the City shall
immediately contact the Purchaser and offer to allow the Purchaser to extend its offer for an additional thirty days. If the
Purchaser does not elect to extend its offer within six days thereafter, then its Good Faith Deposit will be returned, and both
the City and the Purchaser shall be relieved of any further obligation. In no event shall the City be liable for any damages by
reason of its failure to deliver the Certificates, provided such failure is due to circumstances beyond the City's reasonable
control.
Conditions to Delivery ... The obligation of the Purchaser to take up and pay for the Certificates is subject to the Purchaser's
receipt of (a) the legal opinion of McCall, Parkhurst & Horton L.L.P., Austin, Texas, Texas, Bond Counsel for the City ("Bond
Counsel "), (b) the no-litigation certificate, and (c) the certification as to the Official Statement, all as further described in the
Official Statement
In order to provide the City with information required to enable it to comply with certain conditions of the Internal Revenue
Code of 1986 relating to the exemption of interest on the Certificates from the gross income of their owners, the Purchaser will
be required to complete, execute, and deliver to the City (on or before the 6th business day prior to the delivery of the
Certificates) a certification as to their "issue price" substantially in the form and to the effect attached hereto or accompanying
this Notice of Sale and Bidding hnslructions. In the event the successful bidder will not reoffer the Certificates for sale, such
certificate may be modified in a manner approved by the City. In no event will the City fail to dellver the Certificates as a
result of the Initial Purchaser's inability to sell a substantial amount of the Certificates at a particular price prior to
delivery. Each bidder, by submitting its bid, agrees to complete, execute, and deliver such a certificate by the 6 business day
prior to the date of delivery of the Certificates, if its bid is accepted by the City. It will be the responsibility of the Purchaser to
institute such syndicate reporting requirements to nteke such investigation, or otherwise to ascertain the facts new vasry to
enable it to make such certification with reasonable certainty. Any questions concerning such certification should be directed
to Bond Counsel.
Legal Opinions ... The Certificates are offered when, as and if issued, subject to the approval of the Attorney General of the
State of Texas. Delivery of and payment for the Certificates is subject to the receipt by the Purchaser of opinions of Bond
Counsel, to the effect that the Certificates are valid and binding obligations of the City and that the interest on the Certificates
will be excludable from gross income for federal income tax purposes under existing law, subject to the matters described
under "TAX MATTERS" in the Official Statement, including the alternative minimum tax on corporations.
Certification of Otiiclal Statement ... At t time of payment for and Initial Delivery of the Certificates, the City will
execute and deliver to the Purchaser a certificate in the form set forth in the Official Statement
Change in Tax Exempt Status ....At any time before the Certificates are tendered for delivery, the Purchaser may withdraw
its bid if the interest received by private holders on obligations of the same type and character shall be declared to be
includable in gross income under present federal income tax laws, either by riling of the Internal Revenue Service or by a
decision of any Federal court, or shall be declared taxable or be required to be taken into account in computing any federal
income taxes, by the terms of any federal income tax hew enacted subsequent to the date of this Notice of Sale and Bidding
Instructions.
GENERAL
Financial Advisor ... First Southwest Company is employed as Financial Advisor to the City in connection with the issuance
of the Certificates. The Financial Advisor's fee for services rendered with respect to the sale of the Certificates is contingent
upon the issuance and delivery of the Certificates. First Southwest Company may submit a bid for the Certificates, either
independently or as a member of a syndicate organized to submit a bid for the Certificates. First Southwest Company, in its
capacity as Financial Advisor, has relied on the opinion of Bond Counsel and has not verified and does not assume any
responsibility for the information, covenants and representations contained in any of the legal documents with respect to the
federal income tax status of the Certificates, or the possible impact of any present, pending or future actions taken by any
legislative or judicial bodies.
Blue Sky Laws ... By submission of its bid, the Purchaser represents that the sale of the Certificates in states other than Texas
will be made only pursuant to exemptions from registration or, where necessary, the Purchaser will register the Certificates in
accordance with the securities law of the states in which the Certificates are offered or sold. The City agrees to cooperate with
the Purchaser, at the Purchaser's written request and expense, in registering the Certificates or obtaining an exemption from
registration in any state where such action is necessary, provided, however, that the City shall not be obligated to execute a
general or special consent to service of process in any such jurisdiction.
Not an Offer to Sell ... This Notice of Sale and Bidding Instructions does not alone constitute an offer to sell the Certificates,
but is merely notice of the sale of the Certificates. The offer to sell the Certificates is being made by means of the Notice of
Sale and Bidding Instructions, the Official Bid Fonn and the Official Statement. Prospective purchasers are urged to carefully
examine the Official Statement to determine the investment quality of the Certificates.
Issuance of Additional Debt ... The City is issuing $8,910,000 City of Round Rock, Texas General Obligation Bonds, Series
1998, simultaneously, with the issuance of the Certificates.
Ratings ... The presently outstanding tax supported debt of the City is rated "Aa3" by Moody's investors Service, Inc.
( "Moody's ") and "A +" by Standard & Poor's Ratings Services, A Division of The McGraw -Hill Companies, Inc. ( "S&P ").
Insured lax supported debt of the City is rated "Asa" by Moody's and "AAA" by S&P. Applications for contract ratings on this
issue have been made to both Moody's and S&P. The results of their determinations will be provided as soon as possible.
Municipal Bond Insurance ... In the event the Certificates are qualified for municipal bond insurance, and the Purchaser
desires to purchase such insurance, the cost therefor will be paid by the Purchaser. Any fees to be paid to the rating agencies
as a result of said insurance will be paid by the City. It will be the responsibility of the Purchaser to disclose the existence of
insurance, its terms and the effect thereof with respect to the reoffering of the Certificates.
The Official Statement and Compliance with SEC Rule 15c2 -12 .. The City has prepared the accompanying Official
Statement and, for the limited purpose of complying with SEC Rule 15c2 -12, deems such Official Statement to be final as of its
date within the meaning of such Rule for the purpose of review prior to bidding. To the best knowledge and belief of the City,
the Official Statement contains information, including financial information or operating data, concerning every entity,
enterprise, fund, account, or person that is material to an evaluation of the offering of the Certificates. The City has not failed
to comply with any previous continuing disclosure undertaking in a written contract or agreement specified in SEC Rule 15c2-
12(bX5Xi). Representations made and to be made by the City concerning the absence of material misstatements and omissions
in the Official Statement are addressed elsewhere in this Notice of Sale and Bidding Instructions and in the Official Statement
The City will furnish to the Purchaser, or Purchasers, acting through a designated senior representative, in accordance with
instructions received from the Purchaser(s), within seven (7) business days from the sale date an aggregate of 100 copies of the
Official Statement including a like number of copies of any Supplement(s) reflecting interest rates and other terms relating to
the initial reoffering of the Certificates. The cost of a reprinted Official Statement, if the Purchasers) shall so elect, and the
cost of any Official Statement in excess of the number specified shall be prepared and distributed at the cost of the
Purchaser(s). The Purchaser(s) shall be responsible for providing in writing the initial reoffering prices and other terms, if any,
to the Financial Advisor by the close of the next business day after the award Except as noted above, the City assumes no
responsibility or obligation for the distribution or delivery of any copies of the Official Statement in connection with the
offering or reoffering of the subject securities.
Continuing Disclosure Agreement ... The City will agree in the Ordinance to provide certain periodic information and
notices of material events in accordance with Securities and Exchange Commission Rule 15c2 -12, as described in the Official
Statement under "CONTINUING DISCLOSURE OF INFORMATION". The Purchaser(s') obligation to accept and pay for the
Certificates is conditioned upon delivery to the Purchaser(s) or ( their) agent of a certified copy of the Ordinance containing the
agreement described under such heading. See "CONTINUED DISCLOSURE OF INFORMATION" in the Official Statement
iv
Additional Copley of Notice, Bid Form and Statement ... A limited number of additional copies of this Notice of Sale and
Bidding Instructions, the Official Bid Form and the Official Statement, as available over and above the normal mailing, may be
obtained at the offices of First Southwest Company, Investment Bankers, 1700 Pacific Avenue, Suite 500, Dallas, Texas 75201,
Financial Advisor to the City.
On the date of the sale, the City Council will, in the Ordinance authorizing the issuance of the Certificates, confirm its approval
of the form and content of the Official Statement, and any addenda, supplement or amendment thereto, and authorize its use in
the reoffering of the Certificates by the Purchaser.
ATTEST:
JOANNE LAND
City Secretary
June 11, 1998
CHARLES C. CULPEPPER
Mayor
City of Round Rock, Texas
OFFICIAL BID FORM
Honorable Mayor and City Council July 9, 1998
City of Round Rock, Texas
Members of the City Council:
Reference is made to your Official Statement and Notice of Sale and Bidding Instructions, dated June 11, 1998 of $2,550,000 CITY OF
ROUND ROCK, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1998, bath of which
constitute a part hereof.
For your legally issued Certificates, as described in said Notice of Sale and Bidding Instructions and Official Statement, we will pay you
par and accrued interest from date of issue to date of delivery to us, plus a cash premium of $ for Certificates maturing and
bearing interest as follows:
Maturity
8 -15
Principal
Amount
1999 $ 75.000 %
2000 80,000 %
2001 85.000 %
2002 90,000
2003 90,000 %
2004 95,000
2005 100,000
2006 105,000
2007 115,000 %
2008 120,000 %
2009 125,000 %
2010 130,000
2011 140,000
2012 145,000 %
2013 155,000 %
2014 160,000
2015 170,000 %
2016 180,000
2017 190,000 %
2018 200,000 %
Our calculation (which is not a part of this bid) of the interest cost from the above is:
Interest Serial Mandatory Sinking
Rate Amount Fund Installment
TRUE INTEREST COST $
The mandatory sinking fund installments checked above, if any, shall be applied for the redemption of term bonds maturing as follows
Term Bond Year of First Principal
Maturity Dam Mandatory Amount of Interest
Amulet 15 Redemption Term Bond Rate
o/
We are having the Certificates of the following maturities insured by
at a premium of $ . paid nremlwn to be paid by the Purchaser. Any fees to be paid to the rating
agencies as a result of said insurance will he paid by the City.
The Initial Certificate shall be registered in the name of which will, upon payment for
the Certificates, be canceled by the Paying Agent/Registrar. The Certificates will then be registered in the name of Cede & Co. (DTC's
partnership nominee), under the Book -Entry -Only System.
A bank cashier's check or certified check of the Bank, in the amount of 551,000, which
represents our Good Faith Deposit (is attached hereto) or (has been made available to you prior to the opening of this bid), and is submitted in
accordance with the terms as set forth in the Of Statement and Notice of Sale and Bidding Instructions.
We agree to accept delivery of the Certificates utilizing the Book - Entry-Only System through DTC and make payment for the Initial Certificate
in immediately available funds in the Corporate Trust Division, Chase Bank of Texas, National Association, Austin, Texas, not later than 10:00
AM, CDT, on August 18, 1998, or thereafter on the date the Certificates me tendered for delivery, pursuant to the terms set forth in the Notice
of Sale and Bidding Instructions.
The undersigned agrees to complete, execute, and deliver to the City, at least six business days prior to delivery of the Certificates, a certificate
relating to the "issue price" of the Certificates in the form and to the effect accompanying the Notice of Sale and Bidding Instructions, with such
changes thereto as may be acceptable to the City.
We agree to provide in writing the initial reoffering prices and other terms, If any, to the Financial Advisor by the close of the next
business day after the award.
Respectfully submittal, Syndicate Members:
Name of Underwriter or Manager
Authorized Representative
Phone Number
The above and foregoing bid is hereby in all things accepted by the City of Round Rock, Texas, subject to and in accordance with the Notice of
Sale and Bidding Instructions, this the 9 day of July, 1998.
ATTEST:
City Secretary
ACCEPTANCE CLAUSE
Mayor
City of Round Rock, Texas
CERTIFICATE OF UNDERWRITER
The undersigned hereby certifies as follows with rospect to the sale of 52,550,000 CITY OF ROUND ROCK, TEXAS
COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1998 (the "Certificates ").
1. The undersigned is the underwriter or the manager of the syndicate of underwriters which has purchased the
Certificates from the City of Round Rock, Texas (the "Issuer") at competitive sale.
2. The undersigned and/or one or more other members of the underwriting syndicate, if any, have made a bona fide
offering to the public of the Certificates of each maturity at the respective prices set forth below.
3. The initial offering price (expressed as a percentage of principal amount or yield and exclusive of accrued interest)
for the Certificates of each maturity at which a substantial amount of the Certificates of such maturity was sold to the
public is as set forth below:
Principal Offering Principal Offering Principal Offering
Amount Year of Price Amount Year of Price Amount Year of Price
Maturing Maturity ( %/Yield) Maturing Maturity 0/0/Yield) Maturing Maturity ( %/Yield)
$ 75,000 1999 % $ 105,000 2006 % $ 155,000 2013 %
80,000 2000 % 115,000 2007 % 160,000 2014
85,000 2001 % 120,000 2008 % 170,000 2015
90,000 2002 % 125,000 2009 % 180,000 2016 %
90,000 2003 % 130,000 2010 % 190,000 2017
95,000 2004 % 140,000 2011 % 200,000 2018 %
100,000 2005 % 145,000 2012 %
4. The term "public," as used herein, means persons other than bondhouses, brokers, dealers, and similar persons or
organizations acting in the capacity of underwriters or wholesalers.
5. The offering prices described above reflect current market prices at the time of such sales.
6. The undersigned and/or one or more other members of the underwriting syndicate, as the case may be, (have)(have
not) purchased bond insurance for the Certificates. The bond insurance, if any, has been purchased from
(the 'Insurer") for a premiumm cost of $ (net of any
nongnemntee cost, e.g., rating agency fees). The amount of such cost is set forth in the Insurer's commitment and is
separately stated from all other fees or charges payable to the Insurer. The premium does not exceed a reasonable
charge for the transfer of credit risk taking into account payments charged by guarantors in comparable transactions
(including transactions in which a guarantor has no involvement other than as a guar tutor). The present value of the
debt service savings expected to be realized as a result of such insurance, discounted at a rate equal to the yield on
the Certificates which results after recovery of the insurance premium, exceeds the present value of the bond
insurance premium.
7. The undersigned understands that the statements made herein will be relied upon by the Issuer in its effort to
comply with the conditions imposed by the Internal Revenue Code of 1986, as amended, on the excludability of
interest on the Certificates from the gross income of their owners.
EXECUTED and DELIVERED this day of 1998.
(Name of Underwriter or Manager)
BY
(Title)
NEW ISSUE - Book - Entry-Only
OFFICIAL STATEMENT
Dated June 11, 1998
In the opinion of Bond Counsel, interest on the Bonds will be excludable from gross income for federal income tax purposes under
existing law, subject to the matters described under "TAX MATTERS - Tax Exemption" herein, including the alternative minimum tax
on corporations.
$8,910,000
CITY OF ROUND ROCK, TEXAS
(WWlamson and Travis Counties)
GENERAL OBLIGATION BONDS, SERIES 1998
MATURITY SCHEDULE
Ratings:
Moody's: Applied For
S&P: Applied For
See ( "OTHER INFORMATION -
Ratings" herein)
Dated: July 1, 1998 Due: August 15, as shown below
Payment Terms ... Interest on the 58,910,000 City of Round Rock, Texas (the "City") General Obligation Bonds, Series 1998 (the
"Bonds ") will accrue from the dated date as shown above and will be payable February 15 and August 15 of each year, commencing
August 15, 1998, and will be calculated on the basis of a 360-day year of twelve 30 -day months. The Bonds are initially issuable only to
Cede & Co., the nominee of The Depository Trust Company ( "DTC ") pursuant to the Book -Entry-Only System described herein.
Beneficial ownership of the Bonds may be acquired in denominations of 55,000 or integral multiples thereof. No physical delivery of
the Bonds will be made to the purchasers thereof. Principal of, premium, if any, and interest on the Bonds will be payable by the
Paying Agent Registrar to Cede & Co., which will make distribution of the amounts so paid to the beneficial owners of the Bonds. See
"BOND AND CERTIFICATE INFORMATION - Book -Entry-Only System" herein. The initial Paying AgentRegistmr shall be Chase
Bank of Texas, National Association (see 'BOND AND CERTIFICATE INFORMATION - Paying Agent/Registrar").
Authority for Issuance ... The Bonds are issued pursuant to the Constitution and general laws of the State of Texas (the "State "),
including particularly Articles 701 and 1175 Vernon's Texas Civil Statutes ( "V.T.C.S. "), as amended, and the City's home rule charter,
and are direct obligations of the City of Round Rock, Texas (the "City"), payable from a continuing ad valorem tax levied on all taxable
property within the City, within the limits prescribed by law, as provided in the ordinance authorizing the Bonds (the "Ordinance ") (see
"BOND AND CERTIFICATE INFORMATION - Authority for Issuance ").
Purpose ... Proceeds from the sale of the Bonds will be used for (i) public safety facilities improvements, (ii) parks and recreation
facilities equipment and improvements, (iii) public works maintenance facility construction improvements and equipment, (iv) street,
drainage, sidewalk and traffic signal improvements and (v) the costs of issuance associated with the Bonds.
Maturity Price or Maturity Price or Maturity Price or
Amount 8-15 Rate Yield Amount 8 -15 Rate Yield Amount 8 -15 Rate Yield
$ 75,000 1999 $ 225,000 2008 $ 360,000 2016
30,000 2000 240,000 2009 370,000 2017
35,000 2001 300,000 2010 360,000 2018
40,000 2002 310,000 2011 380,000 2019
45,000 2003 320,000 2012 400,000 2020
50,000 2004 330,000 2013 425,000 2021
55,000 2005 340,000 2014 1,780,000 2022
60,000 2006 350,000 2015 1,830,000 2023
200,000 2007
(Accrued Interest from July 1, 1998 to be added)
Redemption ... The City reserves the right, at its option, to redeem Bonds having stated maturities on and after August 15, 2009, in
whole or from time to time in part in principal amounts of $5,000 or any integral multiple thereof, on August 15, 2008, or any date
thereafter, at the par value thereof plus accrued interest to the date fixed for redemption (see "BOND AND CERTIFICATE
INFORMATION - Redemption ").
Ratings . The presently outstanding tax supported debt of the City is rated "Aa3" by Moody's Investors Service, Inc. ("Moody's") and
"A +" by Standard & Poor's Ratings Group, A Division of McGraw -MI ( "S&P"). Insured tax supported debt of the City is rated "Aaa"
by Moody's and "AAA" by S&P. Requests for ratings for the Hands have been made to both rating services (see "OTHER
INFORMATION - Ratings ").
Legality ... The Bonds are offered for delivery when, as and if issued and received by the purchaser(s) and subject to the approving
opinion of the Attamey General dike State of Texas and of McCall, Parkhurst & Horton L.L.P., Bond Counsel, Austin, Texas. The legal
opinion will be printed an or attached to the Bonds (see APPENDIX C - "Form of Bond Counsel's Opinion").
Delivery ... It is expected that the Bonds will be tendered for delivery through DTC on August 18, 1998.
(TIILS PAGE INTENTIONALLY LEFT BLANK)
NEW ISSUE - Book- Entry-Only
OFFICIAL STATEMENT
Dated June 11, 1998
Ratings:
Muody's: Applied For
S &P: Applied For
Sec ("OTHER INFORMATION -
Ratings" herein)
In the opinion of Bond Counsel, interest on the Certificates will be excludable from gross income for federal income tax purposes under
existing law, subject to the matters described under "TAX EXEMPTION" herein, including the alternative minimum tax on corporations.
52,550,000
CITY OF ROUND ROCK, TEXAS
(Williamson and Travis Counties)
COMBINATION TAX AND REVENUE
CERTIFICATES OF OBLIGATION, SERIES 1998
Dated Date: July 1, 1998 Due: August 15, as shown on next page
Payment Terms ... Interest on the 52,550,000 City of Round Rock, Texas Combination Tax and Revenue Certificates of Obligation,
Series 1998 ( the "Certificates ") will accrue from the date as shown above and will be payable February 15 and August 15 of each year,
commencing August 15, 1998, and will be calculated on the basis of a 360 -day year consisting of twelve 30-day months. The definitive
Certificates will be initially registered and delivered only to Cede & Co., the nominee of The Depository Trust Company ( "DTC ")
pursuant to the Book- Entry-Only System described herein. Beneficial ownership of the Certificates may be acquired in denominations of
55,000 or integral multiples thereof, No physical delivery of the Certificates will be made to the owners thereof. Principal of,
premium, if any, and interest on the Certificates will be payable by the Paying Agent/Registrar to Cede & Co., which will make
distribution of the amounts so paid to the participating members of DTC for subsequent payment to the beneficial owners of the
Certificates. See "BOND AND CERTIFICATE INFORMATION - Book- Entry-Only System" herein. The initial Paying Agent/Registrar
is Chase Bank of Texas, National Association (see `BOND AND CERTIFICATE INFORMATION - Paying Agent/Registrar").
Authority for Issuance ... The Certificates are being issued pursuant to the Constitution and general laws of the State, particularly
Subchapter C of Chapter 271, Texas Local Government Code (the "Certificate of Obligation Act of 1971 "), as amended, Articles 1111-
1118 (inclusive), Version's Annotated Texas Civil Statutes, as amended, the City's Home Rule Charter and the Certificate Ordinance.
The Certificates constitute general obligations of the City, payable from a combination of (i) the levy and collection of a continuing,
direct ad valorem tax, within the limits prescribed by law, on all taxable property within the City, and (ii) a limited pledge of not to
exceed $1,000 in amount of surplus revenues of the City's waterworks and sewer system, after deduction of maintenance and operating
expenses and all debt service, reserve and other requirements in connection with all of the City's revenue bonds or other obligations
(now or hereafter outstanding) which are payable from all or part of the net revenues of the City's waterworks and sewer system (see
"BOND AND CERTIFICATE INFORMATION - Authority for Issuance ").
Purpose ... Proceeds from the sale of the Certificates will be used for public improvements within the City including construction,
improvement and equipment of a recreation center and to pay the costs of issuance associated with the Certificates.
MATURITY SCHEDULE
See Next Page
Redemption Option ... The City reserves the right, at its option, to redeem Certificates having stated maturities on and after August 15,
2009, in whole or from time to time in part in principal amounts of $5,000 or any integral multiple thereof on August 15, 2008, or any
date thereafter, at the par valve thereof plus accrued interest to the date of redemption (see 'BOND AND CERTIFICATE
INFORMATION - Optional Redemption").
Ratings ... The presently outstanding tax supported debt of the City is rated "Aa3" by Moody's Investor's Service, Inc. (" Moody's") and
"A +" by Standard & Poor's Ratings Group, A Division of McGraw -Hill ("S&P"). insured tax supported debt of the City is rated "Aaa"
by Moody's and "AAA" by S&P. Requests for ratings for the Certificates have been made to both rating services (see "OTHER
INFORMATION - Ratings").
Legality ... The Certificates are offered for delivery when, as and if issued and received by the initial purchaser(s) and subject to the
approving opinion of the Attorney General of Texas and the opinion of McCall, Parkhurst & Horton L.L.P., Bond Comm], Austin, Texas
(see APPENDIX C - "Form of Bond Counsel's Opinion").
Delivery ... It is expected that the Certificates will be available for delivery though The Depository Trust Company an August 18,
1998.
MATURITY SCHEDULE
Price Price
Maturity or Maturity or
Amount 8-15 Rate Yield Amount 8-15 Rate Yield
$ 75,000 1999 $ 125,000 2009
80,000 2000 130,000 2010
85,000 2001 140,000 2011
90,000 2002 145,000 2012
90,000 2003 155,000 2013
95,000 2004 160,000 2014
100,000 2005 170,000 2015
105,000 2006 180,000 2016
115,000 2007 190,000 2017
120,000 2008 200,000 2018
(Accrued Interest from July 1, 1998 to be added)
4
77tis Official Statement does not constitute an offer to sell Bonds and Certificates in any jurisdiction to any person to whom it
is unlawful to make such offer in such jurisdiction. No dealer, salesman, or any other person has been authorized to give any
information or make any representation, other than those contained herein, in connection with the offering of these Bonds and
Certificates, and if given or made, such information or representation must not be relied upon. The information and
expressions of opinion herein are subject 10 change without notice and neither the delivery of this Official Statement nor any
sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the
City since the date hereof.
OFFICIAL STATEMENT
Description of the Bonds 1
Description of the Certificates 3
CITY ADMINISTRATION
Elected Officials 6
Appointed Officials 6
Consultants and Advisors 6
SELECTED DATA FROM THE OFFICIAL
STATEMENT 7
BOND AND CERTIFICATE INFORMATION
Authority for Issuance 9
Security for Bonds 9
Security for Certificates 9
Tax Limitation 9
Redemption 9
Book - Entry-Only System 10
Paying Agent/Registrar 11
Transfer, Exchange and Registration 11
Limitation on Transfer of Bonds and
Certificates Called for Redemption 11
Record Date for Interest Payment 12
Use of Bond Proceeds 12
Use of Certificate Proceeds 12
Bondholders Remedies 12
BOND INSURANCE 12
TAX INFORMATION
Table 1 - Valuation, Exemptions and Debt
Obligations 15
Table 2 - Taxable Assessed Valuations by
Category 16
Table 3 - Valuation and Funded Debt 3atory 17
Table 4 - Tax Rate, Levy and Collection
History 17
Table 5 - Ten Largest Taxpayers 18
DEBT INFORMATION
Table 6 - Debt Service Requirements 20
Table 7 - Interest and Sinking Fund Budget
Projection. 22
Table 8 - Authorized General Obligation
Bonds 22
FINANCIAL INFORMATION
Table 9 - General Find Revenues and
Expenditlues 23
Table 10 - Municipal Sales Tax History 23
TABLE OF CONTENTS
INVESTMENTS 25
TAX MATTERS 24
5
CONTINUING DISCLOSURE OF INFORMATION
General 29
Annual Reports 29
Material Event Notices 29
Availability of Information from NRMSIRs and
SID 29
Limitations and Amendments 29
Compliance with Prior Undertakings 30
OTHER INFORMATION
Ratings 30
Litigation 30
Registration and Qualification of Bonds for Sale 30
Legal Investments and Eligibility to Secure Public
Funds in Texas 30
Legal Opinions and No-Litigation 30
Authenticity of Financial Data and Other
Information 31
Financial Advisor 31
Certification of the Official Statement 31
APPENDICES
General Information Regarding the City A
Excerpts From the Annual Financial Report B
Form of Bond Counsel's Opinions C
The cover page hereof; this page, the appendices included
herein and any addenda, supplement or amendment hereto,
are part of the Official Statement.
Elected Officials
Charles C. Culpepper 514 Years May 1999 Self- Employed
Mayor
Earl Palmer 9 Years May 1999 Retired Businessman
Mayor Pro-Tem Place 4
Robert Stluka 9 Years May 1999 Independent Consultant,
Councilman Place 1 Capital City Consultants
Earl M. Hairston Newly May 2001 Community Development Manager
Councilman Place 2 Elected
Rick Stewart 8 Years May 2000 Retired Businessman
Councilman Place 3
Martha A. Chavez 6 Years May 2000 School Teacher, RRISD
Councilwoman Place 5
Jimmy Joseph 10 Years May 2001 Self - Employed
Councilman Place 6
Appointed Officials
Consultants and Advisors
CITY ADMINISTRATION
Length of Term
City Council Service Expires Occupation
Length of
Name Position Service
Robert L. Bennett, Jr. City Manager 21 Years
Joanne Land Assistant City Manager /City Secretary 29 Years
David Kautz Director of Finance 22 Years
Stephan L. Sheets City Attorney 21 Years
Auditors Pella, Swayze & Company
Round Rock, Texas
Bond Counsel McCall, Parkhurst & Horton L.L.P.
Austin, Texas
Financial Advisor First Southwest Company
Austin, Texas
For additional information regarding the City, please contact
David Kautz Garry Kimball
Director of Finance First Southwest Company
City of Round Rock or 98 San Jacinto Blvd., Suite 370
221 East Main Street Austin, Texas 78701
Round Rock, Texas 78664 (512) 481 -2000
(512) 218 -5400 c(512) 481 -2010 Fax
6
SELECTED DATA FROM THE OFFICIAL STATEMENT
The selected data on this page is subject in all respects to the more complete information and definitions contained or
incorporated in this Official Statement The offering of the Bonds and Certificates to potential investors is made only by means
of this entire Official Statement. No person is authorized to detach this data page from this Official Statement or to otherwise
use it without the entire Official Statement.
This data page was prepared to present the purchasers of the Bonds and Certificates information concerning the Bonds and
Certificates, the revenues pledged to payment of the Bonds and Certificates, the description of the revenue bast and other
pertinent data, all as more fully described herein.
The Issuer The City of Round Rock, Texas (the "City"), is a political subdivision of the State of Texas
(the "State ") located in Williamson and Travis Counties, Texas, operating as a home -rule
city under the laws of the State and a charter approved by the voters in August, 1977 (the
"Home Rule Charter"). The City operates under a CounciVManager form of government
where the mayor and six councilmembers are elected for staggered three -year terms. The
Council formulates operating policy for the City while the City Manager is the chief
administrative officer.
The City is located in Williamson and Travis Counties, Texas, 8 miles north of Austin and
85 miles south of Waco on Interstate Highway 35. The City is also situated on U.S.
Highway 79, which runs cast and west. Both U.S. HIghway 79 and Interstate Highway 35
are main arteries of traffic in the State (see APPENDIX A - "General Information Regarding
the City").
The Bonds The Bonds are being issued in the principal amount of $8,910,000 pursuant to the general
laws of the State of Texas, particularly Articles 701 and 1175, VATCS, the City's home rule
charter and an Ordinance passed by the City Council of the City (see 'BOND AND
CERTIFICATE INFORMATION - Authority for Issuance ").
The Certificates The Certificates are issued in the principal amount of $2,550,000 pursuant to the general
laws of the State of Texas, particularly Subchapter C of Chapter 271, VTCA Local
Government Code, Articles 1111 -1118 and an Ordinance passed by the City Council of the
City (see 'BOND AND CERTIFICATE INFORMATION - Authority for Issuance ").
Security for the Bonds The Bonds constitute direct and voted obligations of the City, payable from the levy and
collection of a direct and continuing ad valorem tax, within the limits prescribed by law, on
all taxable property located within the City (see "BOND AND CERTIFICATE
INFORMATION - Security for Bonds ").
Security for the
Certificates The Certificates constitute general obligations of the City, payable from a continuing, direct
ad valorem tax levied, within the limits prescribed by law, against all taxable property
located within the City, and are further secured by a limited pledge of not to exceed $1,000
in ammmt of surplus revenues derived from the operation of the City's waterworks and sewer
system (see "BOND AND CERTIFICATE INFORMATION - Security for Certificates ").
Optional Redemption
of the Bonds The City reserves the right, at its option, to redeem Bonds having stated maturities on and
after August 15, 2009, in whole or from time to time in part in principal amounts of $5,000
or any integral multiple thereof, on August 15, 2008, or any date thereafter, at the par value
thereof plus accrued interest to the date fixed for redemption. The Bonds maturing on
and are also subject to mandatory sinking fund redemption (see
"BOND AND CERTIFICATE INFORMATION - Redemption ").
Optional Redemption
of the Certificates The City reserves the right, at its option, to redeem Certificates having stated maturities on
and after August 15, 2009, in whole or from time to time in part in principal amounts of
$5,000 or any integral multiple thereof; on August 15, 2008, or any date thereafter, at the par
value thereof plus accrued interest to the date fixed for redemption. The Certificates
maturing an and are sLso subject to mandatory oinking fund
redemption (see "BOND AND CERTIFICATE INFORMATION - Redemption").
7
Tax Exemption In the opinion of Bond Counsel, the interest on the Bonds and Certificates will be excludable
from gross income for federal income tax purposes under existing law, subject to the matters
described under "TAX MATTERS - Tax Exemption" herein, including the alternative
minimum tax on corporations.
Use of Bond Proceeds Proceeds from the sale of the Bonds will be used for (i) public safety facilities
improvements, (ii) parks and recreation facilities equipment and improvements, (iii) public
works maintenance facility construction improvements and equipment, (iv) street, drainage,
sidewalk and traffic signal improvements and (v) the costs of issuance associated with the
Bonds.
Use of Certificate Proceeds Proceeds from the sale of the Certificates will be used for public improvements within the
City including construction, improvement and equipment of a recreation center and to pay
the costs of issuance associated with the Certificates.
Ratings The presently outstanding tax supported debt of the City is rated "Aa3" by Moody's
Investors Service, Inc. ( "Moody's") and "A +" by Standard & Poor's Ratings Group, A
Division of McGraw -Hill ( "S&P). Application for a contract rating on the Bonds and the
Certificates has been made to Moody's and S&P (see "OTHER INFORMATION - Ratings ").
Book -Entry-Only
System The definitive Bonds and Certificates will be initially registered and delivered only to Cede
& Co., the nominee of DTC pursuant to the Book- Entry-Only System described herein.
Beneficial ownership of thc Bonds and Certificates may be acquired only in denominations
of 55,000 or integral multiples thereof. No physical delivery of the Bonds and Certificates
will be made to the beneficial owners thereof. Principal of, premium, if any, and interest on
thc Bonds and Certificates will be payable by the Paying Agent/Registrar to Cede & Co.,
which will make distribution of the amounts so paid to the beneficial owners of the Bonds
and Certificates (see "BOND AND CERTIFICATE INFORMATION - Book- Entry-Only
System ").
Payment Record The City has never defaulted
Selected Issuer Indices
Ratio Funded
Fiscal Per Capita Per Debt to
Year Estimated Taxable Taxable Funded Capita Taxable % of
Ended City Assessed Assessed Tax Tax Assessed Total Tax
9 -30 Population Valuation Valuation Debt Debt Valuation Collections
1992 33,769 $ 836,585,606 $ 24,774 938,738,400 91,147 4.63% 99.805'o
1993 36,139 914,420,536 tr1 25,303 40,961,100 1,133 4.48% 100.65%
1994 39,460 1,078,249,127 27,325 38,261,000 970 3.55% 101.59%
1995 41,650 1,404,239,617 33,715 43,069,000 1,034 3.07% 100.15%
1996 43,500 1,681,361,634 38,652 51,967,000 1,195 3.09% 99.86%
1997 46,485 1,976,785,606 tD 42,525 53,435,000 1,150 2.70% 100.11%
1998 48,809 2 ,325,756,421 47,650 61,633,000 t4 1,263 e9 2.65% r2) N/A
(1) Revaluation
(2) Includes the Bonds and the Certificates.
8
Authority for Issuance ... The Bonds are being issued pursuant to the Constitution and general laws of the State of Texas,
particularly Articles 701 and 1175, V.T.C.S., as amended, the City's home rule charter and the Ordinance authorizing the
issuance of the Bonds (the "Ordinance "). The Bonds were authorized by an election held within the City on January 20, 1996.
Certificates are being issued pursuant to the Constitution and general laws of the State, particularly Subchapter C of Chapter
271, Texas Local Government Code (the "Certificate of Obligation Act of 1971"), as amended, .Articles 1111 -1118 (inclusive),
Vemon's Annotated Texas Civil Statutes, as amended, the City's home rule charter and the Certificate Ordinance.
Security fur Bonds ... All taxable property within the City is subject to a continuing, direct annual ad valorem tax levied by
the City, within the limits prescribed by law, sufficient to provide for the payment of principal of and interest on all Bonds.
Security for Certificates .. The Certificates will constitute general obligations of the City payable from a continuing, direct
annual ad valorem lax levied, within the limits prescribed by law, against all taxable property in the City. Additionally, the
Certificates are payable from and secured by a limited pledge of not to exceed $1,000 in amount of surplus revenues of the
City's waterworks and sewer system alter payment of all operation and maintenance expenses or collections thereof, and all
debt service, reserve, and other requirements in connection with all of the City's revenue bonds or other obligations (now or
hereafter outstanding) which are payable from all or any part of the net revenues of the City's waterworks and sewer system.
All taxable property within the City is subject to a continuing, direct annual ad valorem tax levied by the City sufficient to
provide for the payment of principal of and interest an all obligations payable in whole or in part from ad valorem taxes, which
tax must be levied within limits prescribed by law.
The Certificates have been made payable from and are secured by the $1,000 limited pledge of surplus revenues of the City's
waterworks and sewer system described above for the purpose of allowing the Certificates to be sold for cash under State law.
The City does not expect to pay the Certificates from the revenues of its waterworks and sewer system.
Tax Limitation ... Article XI, Section 5 of the Constitution of the State, applicable to the City, limits the maximum ad
valorem tax rate to $2.50 per $100 assessed valuation. Administratively, the Attorney General of the State of Texas will permit
allocation of $1.50 of the $2.50 maximum tax rate for general obligation debt service.
Redemption:
Optional Redemption of the Bonds and Certificates ... The City reserves the right, at its option, to redeem Bonds and
Certificates having stated maturities on and after August 15, 2009, in whole or from time to time in part in principal amounts of
$5,000 or any integral multiple thereof on August 15, 2008, or any date thereafter, at the par value thereof plus accrued
interest to the date fixed for redemption. If less than all of the Bonds or Certificates are to be redeemed and if less than all of a
maturity is to be redeemed, the Paying Agent/Registrar shall determine by lot the Bonds and Certificates, or portions thereof
within such maturity to be redeemed. If a Bond or Certificate (or any portion of the principal sum thereof) shall have been
called for redemption and notice of such redemption shall have been given, such Bond or Certificate (or the principal amount
thereof to be redeemed) shall become due and payable on such redemption date and interest thereon shall cease to accrue from
and after the redemption date provided funds for the payment of the redemption price and accred interest thereon are held by
the Paying Agent/Registrar on the redemption date.
Mandatory Sinking Fund Redemption for the Bonds ... In addition to being subject to optional redemption, as provided
above, the Bonds maturing on August 15, and August 15 are subject to mandatory sinking fund redemption
prior to maturity in the following amotmts, on the following dates and at a price of par plus accrued interest to the redemption
date from amounts required to be deposited in the Interest and Sinking Fund
*Stated Maturity.
Bonds Maturing Bonds Maturing
Mandatory
)redemption Date
BOND AND CERTIFICATE INFORMATION
Principal
Amount
•
Mandatory Sinking Fund Redemption for the Certificates ... In addition to being subject to optional redemption, as
provided above, the Certificates maturing on August 15 and August 15, are subject to mandatory sinking fund
9
Mandatory
Redemption Date
Principal
Amount
•
redemption prior to maturity in the following amounts, on the following dates and at a price of par plus accrued interest to the
redemption date from amounts required to be deposited in the Interest and Sinking Fund:
"Stated Maturity.
Certificates Maturing Certificates Maturing
Mandatory
Redemption Date
Principal
Amount
•
10
Mandatory
Redemption Date
Principal
Amount
•
The principal amount of the Bonds and Certificates required to be redeemed pursuant to the operation of the mandatory sinking
fund redemption provisions shall be reduced, al the option of the City, by the principal amount of any Bonds or Certificates of
the stated maturity which, at least 50 days prior to a mandatory redemption date, (1) shall have been acquired by the City, at a
price not exceeding the principal amount of such Bands and Certificates plus accrued interest to the date of purchase thereof,
and delivered to the Paying Agent/Registrar for cancellation, (2) shall have been purchased and cancelled by the Paying
Agent/Registrar at the request of the City, with monies in the Interest and Sinking Fund at a price not exceeding the principal
amount of the Bonds and Certificates plus accrued interest to thc date of purchase thereof, or (3) shall have been redeemed
pursuant to the optional redemption provisions and not theretofore credited against a mandatory sinking fund redemption
requirement.
Book -Entry-Only System ... The Depository Trust Company ("DTC"), New York, New York, will act as securities
depository for the Bonds and Certificates. The Bonds and Certificates will be issued as fully- registered securities registered in
the name of Cede & Co. ( DTC's partnership nominee). One fully - registered Bond and Certificate will be issued for each
maturity of the Bonds and Certificates in the aggregate principal amount of each such maturity and will be deposited with DTC.
DTC 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 securities that its participants ( "Direct Participants ") deposit with DTC. DTC
also facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited
securities through electronic computerized book -entry changes in Participants' accounts, thereby eliminating the need for
physical movement of securities. Direct Participants include securities brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations. DTC is owned by a number of its Direct Participants and by the New York Stock
Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC
system is also available to others such as securities brokers and dealers, banks, and trust companies that clear through or
maintain a custodial relationship with a Direct Participant, either directly or indirectly ( "Indirect Participants "). The Rules
applicable to DTC and its Participants are on file with the Securities and Exchange Commission.
Purchases of Bonds and Certificates under the DTC system must be made by or through DTC Participants, which will receive
a credit for such purchases on DTC's records. The ownership interest of each actual purchaser of each Bond or Certificate
('Beneficial Owner") is in turn to be ruw,c,ded on the Direct or Indirect 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 holding. from the Direct or Indirect Participant
through which the Beneficial Owner entered into the transaction. Transfers of ownership interest in the Bonds and Certificates
are to be accomplished by entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial
Owners will not resolve Bonds and Certificates representing their ownership interests in the Hands and Certificates,
except in the event that use of the book-entry system described herein is discontinued.
To facilitate subsequent transfers, all Bonds and Certificates deposited by Direct Participants with DTC are registered in the
name of DTC's pmtnership nominee, Cede & Co. The deposit of Bonds and Certificates with DTC and their registration in the
name of Cede & Co. effect no change in beneficial ownership. DTC has no knowledge of the actual Beneficial Ownem of the
Bonds and Certificates; DTC's records reflect only the identity of the Direct Participants to whose accounts such Bonds and
Certificates are credited, which may or may not be the Beneficial Owners. The 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 Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them,
subject to any statutory or regulatory requirements as may be in effect from time to time.
Neither DTC nor Cede & Co. will consent or vote with respect to the Bonds and Certificates. Under its usual procedures, DTC
mails an Omnibus Proxy to the City as soon as possible after the Record Date (hereinafter defined). The Omnibus Proxy
assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Bonds and Certificates are
credited on the Record Date (identified in a listing attached to the Omnibus Proxy).
Principal and interest payments on the Bonds and Certificates will be made to DTC. DTC's practice is to credit Direct
Participants' accounts on each payable date in accordance with their respective holdings shown on DTC's records unless DTC
has reason to believe that it will not receive payment on such payable date. Payments by Participants to Beneficial Owners will
be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers
in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, the Paying
Agent/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 DTC is the responsibility of the City, disbursement of such payments to Direct Participants shall be
the responsibility of DTC, and disbursement of such payments to the Beneficial Owners shall be the responsibility of Direct
and Indirect Participants.
DTC may discontinue providing its services as securities depository with respect to the Bonds and Certificates at any time by
giving reasonable notice to the City. Under such circumstances, in the event that a successor securities depository is not
obtained, Bonds and Certificates are required to be printed and delivered.
The City may decide to discontinue use of the system of book -entry transfers through DTC (or a successor securities
depository). In that event, Bonds and Certificates will be printed and delivered.
Use of Certain Terms to Other Sections of this Official Statement. In reading this Official Statement it should be understood
that while the Bonds and Certificates are in the Book - Entry-Only System, references in other sections of this Official Statement
to registered owners should be read to include the person for which the Participant acquires an interest in the Bonds and
Certificates, but (i) all rights of ownership must be exercised through DTC and the Book - Entry-Only System, and (ii) except as
described above, notices that are to be given to registered owners under the Ordinance will be given only to DTC.
Information concerning DTC and the Book -Entry System has been obtained from DTC and is not guaranteed as to accuracy or
completeness by, and is not to be construed as a representation by the City or the Purchasers.
Paying Agent/Reglstrar ... The initial Paying Agent/Registrar is Chase Bank of Texas, National Association. In the
Ordinance, the City retains the right to replace the Paying Agent/Registrar. The City covenants to maintain and provide a
Paying Agent/Registrar at all times until the Bonds and Certificates are duly paid and any successor Paying Agent/Registrar
shall be a commercial bank or trust company organized under the laws of the State of Texas or other entity duly qualified and
legally authorized to serve as and perform the duties and services of Paying Agent/Registrar for the Bonds and Certificates.
Upon any change in the Paying Agent/Registrar for the Bonds and Certificates, the City agrees to promptly cause a written
notice thereof to be sent to each registered owner of the Bonds by United States mail, first class, postage prepaid, which notice
shall also give the address of the new Paying Agent/Registrar.
Transfer, Exchange and Registration ... hr the event the Book - Entry-Only System should be discontinued, the Bonds and
Certificates may be transferred and exchanged on the registration books of the Paying Agent/Registrar only upon presentation
and surrender thereof to the Paying Agent/Registrar at its principal place of payment in Dallas, Texas (the "Designated
Payment Office") and such transfer or exchange shall be without expense or service charge to the registered owner, except for
any tax or other governmental charges required to be paid with respect to such registration, exchange and transfer. Bonds and
Certificates may be assigned by the execution of an assignment form on the respective Bonds and Certificates or by other
instrument or transfer and assignment acceptable to the Paying Agent/Registrar. New Bonds and Certificates will be delivered
by the Paying Agent/Registrar, in lieu of the bonds and Certificates being transferred or exchanged, at the Designated Payment
Office of the Paying Agent/ Registrar, or sent by United States mail, first class, postage prepaid, to the new registered owner or
his designee. To the extent possible, new Bonds and Certificates issued or an exchange or transfer of Bonds and Certificates
will be delivered to the registered owner or assignee of the registered owner in not more than three business days after the
receipt of the Bonds and Certificates to be canceled, and the written instrument of transfer or request for exchange duly
executed by the registered owner or his duly authorized agent, in form satisfactory to the Paying Agent/Registrar. New Bonds
and Certificates registered and delivered in an exchange or transfer shall be in any integral multiple of 55,000 for any one
maturity and for a like aggregate principal amount as the Bonds and Certificates surrendered for exchange or transfer. See
"Book-Entry-Only System" herein for a description of the system to be utilized initially in regard to ownership and
transferability of the Bonds.
Limitation on Transfer of Bonds and Certificates Called for Redemption . . . Neither the City nor the Paying
Agent/Registrar shall be required to transfer or exchange any Bond or Certificate called for redemption, in whole or in part,
11
within 45 days of the dale fixed for redemption; provided, however, such limitation of transfer shall not be applicable to an
exchange by the registered owner of the uncalled balance of a Bond or Certificate.
Record Date for Interest Payment ... The record date ( "Record Date ") for the interest payable on any interest payment date
means the close of business on the last day of the preceding month.
In the event of a nun- payment of interest on a scheduled payment date, and for 30 days thereafter, a new record date for such
interest payment (a "Special Record Date ") will be established by the Paying Agent/Registrar, if and when funds for the
payment of such interest have been received from the City. Notice of the Special Record Date and of the scheduled payment
date of the past due interest ("Special Payment Date ", which shall be 15 days alter the Special Record Date) shall be sent at
least five business days prior to the Special Record Date by United States mail, first class postage prepaid, to the address of
each Holder of a Bond or Certificate appearing on the registration books of the Paying Agent/Registrar at the close of business
on the last business day next preceding the date of mailing of such notice.
Use of Bond Proceeds ... Prnrrrds from the sale of the Bonds will be used for (i) public safety facilities improvements, (ii)
parks and recreation facilities equipment and improvements, (iii) public works maintenance facility construction improvements,
(iv) street, drainage, sidewalk and traffic signal improvements and (v) the costs of issuance ncsnciated with the Bonds.
Use of Certificate Proceeds ... Proceeds from the sale of the Certificates will be used for public improvements within the
City including construction, improvement and equipment of a recreation center and to pay the costs of issuance associated with
the Certificates.
Bondholders' Remedies ... The Ordinance does not establish specific events of default with respect to the Bonds and
Certificates. Under State law there is no right to the acceleration of maturity of the Bonds and Certificates upon the failure of
the City to observe any covenant under the Ordinance. Although a registered owner of the Bonds and Certificates could
presumably obtain a judgment against the City if a default occurred in the payment of principal of or interest on any such Bonds
and Certificates, such judgment could not be satisfied by execution against any property of the City. Such registered owner's
only practical remedy, if a default occurs, is a mandamus or mandatory injunction proceeding to compel the City to levy, assess
and collect an annual ad valorem tax sufficient to pay principal of and interest on the Bonds and Certificates as it becomes due.
The enforcement of any such remedy may be difficult and time consuming and a registered owner could be required to enforce
such remedy on a periodic basis. The Ordinance does not provide for the appointment of a trustee to represent the interests of
the bondholders upon any failure of the City to perform in its creditors under Chapter 9 of the U.S. Bankruptcy Code. Although
Chapter 9 provides for the recognition of a security inte.wt represented by a specifically pledged source of special revenues, the
pledge of taxes and other general revenues in support of a general obligation of a bankrupt entity is not specifically recognized
as a security interest under Chapter 9. Chapter 9 also includes an automatic stay provision that would prohibit, without
Bankruptcy Court approval, the prosecution of any other legal action by creditor or bondholder of an entity which has sought
protection under Chapter 9. Therefore, should the City avail itself of Chapter 9 protection from creditors, the ability to enforce
would be subject to the approval of the Bankruptcy Court (which could require that the action be heard in Bankruptcy Court
instead of other federal or state court) and the Bankruptcy Code provides for broad discretionary powers of a Bankruptcy Court
in administering any proceeding brought before it. The opinion of Bond Counsel will note that all opinions relative to the
enforceability of the Ordinance and the Bonds and Certificates are qualified with respect to the customary rights of debtors
relative to their creditors.
BOND INSURANCE
The City has applied to several bond insurance companies to qualify the Bonds and Certifies for bond Mama= which may
be purchased at the option of the Purchaser(s).
12
TAX INFORMATION
Ad Valorem Tax Law ... The appraisal of property within the City is the responsibility of the Williamson County Appraisal
District (the "Appraisal District "). Excluding agricultural and open -space land, which may be taxed on the basis of productive
capacity, the Appraisal District is required under the Property Tax Code to appraise all property within the Appraisal District
on the basis of 100% of its market value and is prohibited from applying any assessment ratios. The value placed upon
property within the Appraisal District is subject to review by an Appraisal Review Board, consisting of three members
appointed by the Board of Directors of the Appraisal District. The Appraisal District is required to review the value of property
within the Appraisal District at least every three years. The City may require annual review at its own expense, and is entitled
to challenge the determination of appraised value of properly within the City by petition filed with the Appraisal Review
Board.
Reference is made to the Property Tax Code, V.T.C.A., for identification of property subject to taxation; property exempt or
which may be exempted from taxation, if claimed; the appraisal of property for ad valorem taxation purposes; and the
procedures and limitations applicable to the levy and collection of ad valorem taxes.
Article VIII of the State Constitution ( "Article VIII ") and State law provide for certain exemptions from property taxes, for the
valuation of agricultural and open -space lands at productivity value, and for the exemption of certain personal property from ad
valorem taxation.
Under Article VIII, Section I -b, and State law, the governing body of a political subdivision, at its option, may grant (1) an
exemption of not less than $3,000 of the market value of the residence homestead of persons 65 years of age or older and the
disabled from all ad valorem taxes thereafter levied by the political subdivision; and (2) an exemption of up to 20% of the
market value of residence homesteads. The minimum exemption under this provision is $5,000.
In the case of residence homestead exemptions granted under Article VIII, Section 1 -b, ad valorem taxes may continue to be
levied against the value of homesteads exempted where ad valorem taxes have previously been pledged for the payment of debt
if cessation of the levy would impair the obligation of the contract by which the debt was created
State law and Article VIII, Section 2, mandate an additional property tax exemption for disabled veterans or the surviving
spouse or children of a deceased veteran who died while on active duty in the armed forces; the exemption applies to either real
or personal property with the amount of assessed valuation exempted ranging from 55,000 to a maximum of $12,000.
Article VIII provides that eligible owners of both agricultural land (Section I-d) and open -space land (Section 1-d-1), including
open -space land devoted to farm or ranch purposes or open -space land devoted to timber production, may elect to have such
property appraised for property taxation on the basis of its productive capacity. The same land may not be qualified under both
Section 1-d and Section 1 d -I .
Nonbusiness personal property, such as automobiles or light trucks, are exempt from ad valorem taxation unless the governing
body of a political subdivision elects to tax this property. Boats owned as nonbusiness property are exempt from ad valorem
taxation.
Article VIII, Section 1-j of the Texas Constitution provides that goods, wares, merchandise, other tangible property and ores,
other than oil, natural gas and other petroleum products, which have been acquired or brought into the state for assembling,
storing, manufacturing, processing or fabricating and shipped out of the state within 175 days ("freeport goods") are exempt
from taxation unless action to tax was taken by the governing body of the political subdivision prior to April 1, 1990. Decision
to tax freeport property may be reversed in the future while decisions to exempt freeport property are not subject to reversal.
The City and the other taxing bodies within its territory may agree to jointly create tax increment financing zones, under which
the tax values an property in the zone are "frozen" at the value of the property at the time of creation of the tee. The City also
may enter into tax abatement agreements to encourage economic development Under the agreements, a property owner agrees
to construct certain improvements on its property. The City in tan agrees not to levy a tax on all or part of the increased value
attributable to the improvements until the expiration of the agreement The abatement agreement could last for a period of up
to 10 years
EFFECTIVE TAX RATE AND RoLi,aA sr Tax RATE ... By each September 1 or as soon thereafter as practicable, the City
Council adopts a tax rate per $100 taxable value for the current year. The tax rate consists of two components: (1) a rate for
funding of maintenance and operation expenditures, and (2) a rate for debt service.
Under the Property Tax Code, the City must annually calculate and publicize its "effective tax rate" and "rollback tax rate ".
The City Council may not adopt a tax rate that exceeds the lower of the rollback tax rate or 103% of the effective tax rate until
13
it has held a public hearing on the proposed increase following notice to the taxpayers and otherwise complied with the
Property Tax Code. If the adopted tax rate exceeds the rollback tax rate the qualified voters of the City by petition may require
that an election be held to determine whether or not to reduce the tax rate adopted for the current year to the rollback tax rate.
"Effective tax rate" means the rate that will produce last year's total tax levy (adjusted) from this year's total taxable values
(adjusted). "Adjusted" means lost values are not included in the calculation of last year's taxes and new values are not
included in this year's taxable values.
"Rollback tax rate" means the rate that will produce last year's maintenance and operation tax levy (adjusted) from this year's
values (adjusted) multiplied by 1.08 plus a rate that will produce this year's debt service from this year's values (unadjusted)
divided by the anticipated tax collection rate.
The Property Tax Code provides that certain cities and counties in the Stale may submit a proposition to the voters to authorize
an additional one -half cent sales tax on retail sales of taxable items. If thc additional tax is levied, the effective tax rate and the
rollback tax rate calculations are required to be offset by the revenue that will be generated by the sales tax in the current year.
Reference is made to the Properly Tax Code for definitive requirements for the levy and collection of ad valorem taxes and the
calculation of the various defined tax rates.
PROPERTY ASSESSMENT Arm Tax PAYMENT ... Property within the City is generally assessed as of January 1 of each year.
Business inventory may, at the option of the taxpayer, be assessed as of September 1. Oil and gas reserves are assessed on the
basis of a valuation process which uses an average of the daily price of oil and gas for the prior year. Taxes become due
October 1 of the same year, and become delinquent on February 15 of the following year. Taxpayers 65 years old or older are
permitted by State law to pay taxes on homesteads in four installments with the first due on February 15 of each year and the
final installment due on August 15.
PENALTIES AND Irvrclusr ... Charges for penalty and interest on the unpaid balance of delinquent taxes are made as follows:
Cumulative Cumulative
Month Penalty Interest Total
February 6% 1% 7%
March 7 2 9
April 8 3 11
May 9 4 13
June 10 5 15
July 12 6 18
After July, penalty remains at 12%, and interest increases at the rate of 1% each month. In addition, if an account is delinquent
in July, a 15% attorney's collection fee is added to the total tax penalty and interest charge. Under certain circumstances, taxes
which become delinquent on the homestead of a taxpayer 65 years old or older incur a penalty of 8% per annum with no
additional penalties or interest assessed. In general, property subject to the City's lien may be sold, in whole or in parcels,
pursuant to court order to collect the amounts due. Federal law does not allow for the collection of penalty and interest a • airs[
an estate in bankruptcy. Federal bankruptcy law provides that an automatic stay of action by creditors and other entities,
including governmental units, goes into effect with the filing of any petition in bankruptcy. The automatic stay prevents
governmental units from foreclosing on property and prevents liens for post - petition taxes from attaching to property and
obtaining secured creditor status unless, in either case, an order lifting the stay is obtained from the bankruptcy court. In many
cases post - petition taxes are paid as an administrative expense of the estate in bankruptcy or by order of the bankruptcy court.
CT( APPLICATION OF TAX CODE ... The City grants an exemption to the market value of the residence homestead of persons
65 years of age or older of $22,000; the disabled are also granted an exemption of from $5,000 to $12,000.
The City has not granted an additional exemption of 20% of the market value of residence homesteads.
See TABLE 1 for a listing of the amounts of the exemptions described above.
Ad valorem taxes are not levied by the City against the exempt value of residence homesteads for the payment of debt
The City does not tax nonbusiness personal property, and the Round Rock Independent School District collects taxes for the
City.
The City does not permit split payments, and discounts are not allowed
The City does not tax fieeport property.
The City does collect the additional one -half cent sales tax for redaction of ad valorem taxes.
14
The City voted on August 9, 1997 to levy an additional 14 cent sales tax to be used for economic development transportation
projects.
The City has adopted a lax abatement policy. The City has granted abatements under various agreements, covering total
property currently valued at $89,078,599. These agreements will expire between 1998 -2006.
Table 1 - Valuation, Exemptions and Debt Obllgatlonst
1997 Total Appraised Value Established by Williamson County Appraisal District S 2,690,717,901
Less Tonally Exempt Property (including Open Space Land Use) 161,750,307
1997 Market Valuation Established by Williamson County Appraisal District $ 2,528,967,594
Less Exemptions/Reductians at 100% of Market Value
Over 65 and Disabled Homestead Excmptions 9 17,935,251
Disabled Veterans Exemptions 2,067,000
Freeport Exemptions 53,036.787
Tax Abatement Reductions 89,078,599
Other Reductions 41,093,536 203,211,173
1997 Certified Taxable Assessed Valuation $ 2,325,756,421
City Funded Debt Payable from Ad Valorem Taxes:
General Purpose Obligations (as of 9/30/98) $ 50,173,000 (n
The Bonds 8,910,000
The Certificates 4550,000
Funded Debt Payable from Ad Valorem Taxes S 61,633,000 esxs
Less: Self Supporting Debt
Waterworks and Sewer System General Obligation Bonds
Combination Tax and Revenue Certificates of Obligation
Net Funded Debt Payable from Ad Valorem Taxes 9 49,864,597
Interest and Sinking Fund (as of 9- 30-97) 9 1,161,951
Ratio of Funded Debt to 1997 Taxable Assessed Valuation 2.65%
Ratio of Net Funded Debt to 1997 Taxable Assessed Valuation 2.14%
1998 Estimated Population - 48,809
Per Capin 1997 Taxable Assessed Valuation - S47,650
Per Capital Funded Debt - 1,263
(1) Reduction made to the appraised value of productive agricultural and open -space land under the provisions of Sections 1-d and 1-
d-1 of Article VIll.
(2) Pursuant to authority permitted by Section 1 -b of Article VI1I, the City, beginning in 1975. has granted a property tax exemption
to the residence homestead of property owners over 65 years dap.
(3) The Texas Legislature, pursuant to a constitutional amendment and Section 11.22 of the Texas Tax Code, mandated an additional
property tax exemption, beginning in 1976, for disabled veterans or the surviving spouse or children of a deceased veteran who
died while on active duty in the armed forces. The exemption from taxation applies to either real or pemonal property with the
amount of Assessed Valuation exempted ranging from 65,000 to 612,000, dependent upon the amount of disability or whether the
exemption is applicable to a surviving spouse or children.
(4) Includes the Bonds and Certificates.
(5) Any transfer of Waterworks and Sewer System revenue for the payment of geneeal obligation debt is discretionary. No assurance
can be given that the City Council will, in the future, authorize the use of any Waterworks and Soarer System revenues to pay debt
service on these Waterworks and Sewer System general obligation bonds or any outer City debt payable from ad valorem taxes.
(6) Allocation of Series 1995 Combination Tax & Revenue Certificates of Obligation to Golf Course, which is self - supporting. Under
an operating contract entered into in October 1995, debt service allocated to the Golf Course must be paid with any and all Sends
available from Golf Course operations after the payment of operating expenses, excluding management fees.
15
$ 5,798,421
5,970,000 S 11,768,421
Table 2 - Taxable Assessed Valuations by Category
Category
Real, Residential, Single - Family
Reel, Residential, Multi- Family
Real, Vacant Lots/Tracts
Real, Acreage (Land Only)
Real, Farm and Ranch Improvements
Real, Commercial
Real and Tangible Personal, Utilities, Other
Tangible Personal, Commercial/Industrial
Tangible Personal, Other
Real Property, Inventory
Total Appraised Value Before Exemptions
Lass: Total Exemptions/Reductions
Plus: Arbitration Values
Taxable Assessed Value
Category
Real, Residential, Single- Family
Real, Residential, Multi- Family
Real, Vacant Lots /tracts
Real, Acreage (Ind Only)
Real, Farm and Ranch Improvements
Real, Commercial
Real and Tangible Personal, Utilities, Other
Tangible Personal, Commercial/Industrial
Tang Personal, Other
Real Property, Inventory
Total Appraised Value Before Exemptions
Less: Total Exemptions/Reductions
Plus: Arbitration Values
Taxable Assessed Value
Amount
$ 1,252,730,438
191,966,764
73,284,983
103,300,866
3,197,556
431,962,318
48,489,706
424,030,670
4,293
0
5 2.528,967,594
203,211,173
0
b 2,320,156,421
Taxable Appraised Value for Fiscal Year Ended September 30,
1995 1994
Amount
$ 832,524,130
116,344,182
50,058,590
48,650,999
2,336,633
195,420,480
32,387,477
160,535,656
2,658
0
$ 1,438,260,805
34,021,158
0
$ 1,404,239,
Taxable A.. -'sad Value for Fiscal Year Ended Se 'tember 30,
1 "7
of
Total
49.54%
7.59%
2.90
4.08%
0.16%
17.08%
1.92%
16.77%
0.00%
0.00%
100.04%
/° of
Total
57.88%
8.09
3.48%
3.38%
0.16%
13.59%
2.25
11.16%
0.00%
0.00%
100.00%
Amount
$ 1,085,291,467
143,170,483
56,740,366
52,477,802
2,129,323
268,021,643
37,750,738
293,061,409
2,298
0
S 1,938,645,529
98,198,495
136,338,572
1,976,785,606
Amount
$ 606,451,376
93,004,600
17,594,492
29,478,200
2,095,627
171,042,557
29,447,478
176,403,714
33,716
10,618,350
$ 1,136,170,110
57,920.983
0
$ 1,0/8,249,127
of
Total
55.98%
7.39%
2.93%
2.71%
0.11%
13.83%
1.95%
15.12%
0.00%
0.00%
100.00%
% of
Total
53.38%
8.19%
1.55%
2.59%
0.18%
15.05%
2.59%
15.53%
0.00
0.93%
100.00%
Note: The values shown in this table are calculated at the beginning of each tax year and are subject to appeal.
Amount
$ 948,826,139
124,289,924
51,761,992
66,808,027
1,752,305
236,557,231
33,898,139
263,640,281
2,658
0
$ 1,727,536,696
94,743,974
48,568,912
b 1,681,361,63
% of
Total
54.92°/
7.19%
3.00%
3.87%
0.10%
13.69%
1.96%
15.26%
0.00%
0.00%
100.00%
Table 3 - Valuation and Funded Debt History
Funded Ratio Funded
Fiscal Per Capita Debt Debt to Per
Year Estimated Taxable Taxable Outstanding Taxable Capita
Ended City Assessed Assessed at End Assessed Funded
9-30 Population Valuation Valuation of Year Valuation Debt
1992 33,769 $ 836,585,606 01 $ 24,774 338,738,400 4.63% $ 1,147
1993 36,139 914,420,536 25,303 40,961,100 4.48% 1,133
1994 39,460 1,078,249,127 27,325 38,261,000
3.55% 970
1995 41,650 1,404,239,617 33,715 43,069,000 3.07% 1,034
1996 43,500 1,681,361,634 38,652 51,967,000 3.09% 1,195
1997 46,485 1,976,785,606 (1) 42,525 53,435,000 2.70% 1,150
1998 48,809 2,325,756,421 47,650 61,633,000 ro 2.65% t21 1,263 (2)
(1) Revaluation.
(2) Includes the Bonds and the Certificates.
Table 4 - Tax Rate, Levy and Collection History
Fiscal
Year Distribution
Ended Tax General Interest and %Current % Total
9 -30 Rate Fund Sinking Fund Tax Levy Collections Collections
1992 $0.62448 $0.27540 $ 0.34940 $5,399,266 98.35% 99.80%
1993 0.62459 0.28500 0.33959 5,709,316 97.06% 100.65%
1994 0.56924 0.24668 0.32256 6,137,825 99.83% 101.59%
1995 0.48896 0.21107 0.27789 6,904,316 99.04% 100.15%
1996 0.42635 0.18161 0.24474 7,295,242 98.54% 99.74%
1997 0.39880 0.17537 0.22343 7,883,421 99.06% 100.11%
1998 0.37706 0.17098 0.20608 8,769,660 N/A N/A
Source: City of Round Rock.
Property within the City is assessed as of January 1 of each year (except for business inventory which may, at the option of the
taxpayer, be assessed as of September 1); taxes become due October 1 of the same year, and become delinquent on February 15
of the following year. Split payments are permitted. Discounts are allowed Taxpayers 65 years old or older are permitted by
State law to pay taxes on homesteads in four installments with the first due on February 15 of each year and the final
installment due on August 15.
Charges for penalty and interest on the unpaid balance of delinquent taxes are made as follows:
Month Penalty Interest Total
February 6% 1% 7%
March 7% 2% 9%
April 8% 3% 11%
May 9% 4% 13%
June 10% 5% 15%
July 12% 6% 18%
After July, penalty remains at 12 %, and interest increases at the rate of 1% each month. In addition, if an accomt is delinquent
in July, a 15% attorney's collection fee is added to the total tax penalty and interest charge. Under certain circumstances, taxes
which became delinquent on the homestead of a taxpayer 65 years old or older incur a penalty of 8% per annum with no
additional penalties or interest assessed. In general, property subject to the City's lien may be sold, in whole or in parcels,
pursuant to court order to collect the amounts due the City and all other taxing entities. Federal law does not allow for the
collection of penalty and interest against an estate in bankruptcy. Federal bankruptcy law provides that an automatic stay of
action by creditors and other entities, including governmental units, goes into effect with the filing of any petition in
17
bankruptcy. The automatic stay prevents governmental units from foreclosing on property and prevents liens for post - petition
taxes from attaching to property and obtaining secured creditor status unless, in either case, an order lifting the stay is obtained
from the bankruptcy court. In many cases post - petition taxes are paid as an administrative expense of the estate in bankruptcy
or by order of the bankruptcy court.
The Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), enacted on August 9, 1989, contains
certain provisions which affect the time for protesting properly valuations, the fixing of fax liens and the collection of penalties
and interest on delinquent taxes on real property owned by the FDIC.
Under ELRREA, real property held by the FDIC is still subject to ad valorem taxation, but (i) no real property of the FDIC is
subject to foreclosure or sale without the consent of the FDIC and no involuntary lien will attach to such property, (0) the FDIC
is not liable for any penalties or fines, including those arising from the failure to pay any real property fax when due and (iii)
notwithstanding the failure of a person to challenge an appraisal in accordance with State law, such value will be determined as
of the period for which such tax is imposed
Table 5 - Ten Largest Taxpayers
Tax Rate Limitation ... All taxable property within the City is subject to the assessment, levy and collection by the City of a
continuing, direct annual ad valorem fax sufficient to provide for the payment of principal of and interest on all ad valorem tax
debt within the limits prescribed by law. Article XI, Section 5, of the Texas Constitution is applicable to the City, and limits
its maximum ad valorem tax rate to $2.50 per $100 Assessed Valuation for all City purposes. The City opcmtes under a Home
Rule Charter which adopts the constitutional provisions. Administratively, the Attorney General of the State of Texas will
permit allocation of $1.50 of the $2.50 maximum tax rate for general obligation debt service.
By each September 1 or as soon thereafter as practicable, the City Council adopts a tax rate per $100 taxable value for the
current year. The tax rate consists of two components: (1) a rate for funding of maintenance and operation expenditures, and
(2) a rate for debt service.
Under the Tax Code:
1997 % of Total
Taxable Taxable
Assessed Assessed
Name of Taxpayer Valuation Valuation
Dell Computer Holdings LP $ 105,031,146 4.52 %
Cypress Semiconductor 71,670,599 3.08
McNeil Consumer Products Co. 24,756,072 1.06
Limestone Ridge LTD 24,353,831 1.05
Walmart 22,689,943 0.98
Dupont Photomasks Inc. 19,760,076 0.85
Steeplechase Downs 18,850,000 0.81
Westinghouse Motor Co. 18,432,137 0.79
Texas Utilities Electric 17,590,607 0.76
Sysco Food Services Inc. 16,904,720 0.73
$ 340,039,131 14.62 %
The City must annually calculate and publicize its "effective tax rate" and "rollback tax rate ". The City Council may not adopt
a tax rate that exceeds the lower of the rollback tax rate or 103% of the effective tax rate until it has held a public hearing on
the proposed increase following notice to the taxpayers and otherwise complied with the Tax Code. If the adopted tax rate
exceeds the rollback tax rate the qualified voters of the City by petition may require that an election be held to determine
whether or not to reduce the tax rate adopted for the current year to the rollback tax rate.
"Effective tax rate" means the rate that will produce last year's total tax levy ( adjusted) from this year's total taxable values
(adjusted). "Adjusted" means lost values are not included in the calculation of last yea's taxes and new values are not
included in this year's taxable values.
"Rollback tax rate" means the rate that will produce last year's maintmanrr and operation tax levy (adjusted) from this year's
valves (adjusted) multiplied by 1.08 plus a rate that will produce this year's debt service from this year's vabtes (unadjusted)
divided by the anticipated tax collection rate.
18
The Tax Code provides that certain cities and counties in the State may submit a proposition to the voters to authorize an
additional one -half cent sales tax on retail sales of taxable items. If the additional tax is levied, the effective tax rate and the
rollback tax rate calculations are required to be offset by the revenue that will be generated by the sales tax in the current year.
The City does collect the additional one -half cent sales fax.
Reference is made to the Tax Code for definitive requirements for the levy and collection of ad valorem taxes and the
calculation of the various defined tax rates.
Source: City of Round Rock Finance Office.
(THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK)
19
Table 6 - Debt Service Requirements
Fiscal Total 1.®: Tax.
Year » Tax Self Supported
Boded Tax- Sappo601 The Bonds The Certificates Supported Supportme Net
30Sep Debt Service principal Interest Total Principal at... I"' Taal Debt Service Debt Service Debt Service
1998 06468,400 SO 859,895 559,895 50 816,363 $16,363 06,544,658 52,274,110 04,270,548
1999 6371,113 75,000 490,050 565,050 75,000 133.875 208.875 7,045,038 1,889,338 5,155,700
2000 6,092,976 30,000 485,925 515,925 80,000 129.938 209,938 6,818,839 1,473,439 5345,400
2001 5,917,342 35,000 484,275 519,275 85,000 125,738 210,738 6,617,353 1. 460,726 5,186,629
2002 5,518,948 40,003 482,350 522,350 90,000 121,275 211,275 6.252,573 1,367,036 4,685,537
2003 5,505,438 45,000 480,150 525150 90,000 116,550 206,550 6,237,138 1.376326 4,860,812
2004 5,354,033 50,000 477.675 527,675 95,000 111,825 206,825 6,088,533 1,237,428 4,851,105
2005 5,110,685 55,000 474,925 529,925 100,000 106.638 206838 5,847,448 1,231,644 4,616,404
2006 2,925,535 60,000 471,900 531,900 105,000 101,588 206,588 3,664,023 487,538 3,176,485
2007 2 ,652726 200,000 468,600 668,600 115,000 96,075 211,075 3,532,401 483337 3,048.864
2008 2,543,126 225,000 457,600 662,600 120,000 90,038 210,038 3,435,764 485.541 2,950,223
2009 2,533,064 240,000 445,225 665,225 125,000 83,738 208,738 3,427,027 486,756 2,940,271
2010 2,434,633 300000 432025 732,025 130,009 77,175 207,175 3,373,833 461,015 2912818
2011 2,432,391 310,000 415,525 725,525 140,030 70,350 210,350 3,368,266 460,575 2907,691
2012 2429,446 320,000 398,475 718,475 145,000 63,000 208,000 3,355,921 459,365 2896,556
2013 2423,790 330,000 380,875 710,875 155,000 55388 210,388 3,345,053 457,065 2887.988
2014 2,423,561 340,030 362,725 702,725 160,000 47,250 207,250 3,333,536 459,150 2,874,386
2015 2,413,326 350,000 344.025 694,025 170,000 38,850 208.850 3,316,201 455,313 2860,888
2016 2,262,935 360,000 324,775 684,775 180,000 29,925 209,925 3,157,635 455,625 2,702,010
2017 2260,231 370,000 304,975 674,975 190,000 20,475 210,475 3,145,681 455,600 2690,681
2018 1, 786 ,430 360,000 284,625 644,625 200,000 10,500 210,500 2,641,555 453,438 218 6,117
2019 1,778,332 380,000 264,825 644,825 0 0 0 2423,157 450,938 1.972,219
2020 1,786196 400,000 243,925 643,925 0 0 0 2,430,121 452,500 1,977,621
2021 1,783,893 425,000 221,925 646,925 0 0 0 2,430,818 452,813 1,978,005
2022 446,701 1,780,000 193,550 1,978,550 0 0 0 2,425,251 451,875 1,973,376
2023 4467 39 1,830000 100,650 1,930,650 0 0 0 2377,389 449,688 1.927.701
2074 450,701 0 0 0 0 0 0 450,701 451.250 -549
2025 443,276 0 0 0 0 0 0 443,276 446,250 -2,974
584695,967 59910,000 59,556,479 S18,466,470 52550,000 51,646,754 54,196,754 5107,559,191 621,524,679 S36,034.512
(1) Interest calculated at a rata of 5.50% for purposes of rilushe6on.
(2) Interest calculated at a rata of 525% for purposes of rilusl,ulion.
DEBT INFORMATION
19
Assessed Valuations, Tax Rates, Direct and Overlapping Funded Debt Payable From Ad Valorem Taxes and Authorized But Unissued Bonds of Overlapping Taxing
Jurisdictions
City's
Overlapping Authorized
Total Estimated G.O. But Unissued
G.O. Tax % Tax Debt Debt As Of
Taxing Jurisdiction Debt Applicable Asof4 /1/98 4/1/98
City of Round Rock $ 49,864,597 100.00% $ 49,864,597 $ 1,585,000
Round Rock Independent School District 259,451,167 28.68% 74,410,594 0
Georgtown Independent School District 56,222,136 0.03% 16,867 0
WiilliamsonCotmty 51,340,000 19.50% 10,011,300 0
Travis County 199,684,011 0.46% 918,546 0
Total Direct and Overlapping Net G. O. Tax Debt $ 135,221,904
Ratio of Direct. and Overlapping Net G. O. Tax Debt to Taxable Assessed Valuation 5.81%
Per Capita Overlapping G. O.Tax Debt $ 2,770
(1) Includes the Bonds and Certificates and excludes self - supporting debt (see "DEBT INFORMATION" and accompanying footnotes).
Expenditures of the various taxing bodies within the territory of the City are paid out of ad valorem taxes levied by these taxing bodies on properties within the City. These
political taxing bodies are independent of the City and may incur borrowings to finance their expenditures. The following statement of direct and estimated overlapping ad
valorem tax bonds was developed from information contained in "Texas Municipal Reports" published by the Municipal Advisory Council of Texas. Except for the amounts
relating to the City, the City has not independently verified the accuracy or completeness of such information, and no person should rely upon such information as being accurate
or complete. Furthermore, certain of the entities listed below may have issued additional bonds since the date stated above, and such entities may have programs requiring the
issuance of substantial amounts of additional bonds the amount of which cannot be determined. The following table reflects the estimated share of overlapping funded debt of
these various taxing bodies.
Table 7 - interest and Sinking Fund Budget Projection
Estimated Net General Obligation Debt Service Requirements, Fiscal Year Ending 9 -30 -98 $ 4 ,270,548
Interest and Sinking Fund, 9 -30-97 $ 1,161,951
1998 Interest and Sinking Fund Tax Levy @ 98% Collection $ 4,694,942
Estimated Investment Income (Fiscal 1998) $ 130,000
Estimated Balance, 9 -30 -98 $ 1,716,345
Table 8 - Authorized General Obligation Bonds
(1) Includes the Bonds.
Amount
Date Amount Heretofore Unissued
Purpose Authorized Authorized Issued (I) Balance
North Fork Water and Sewer Project 9 -06-80 $ 10,000,000 $ 8,415,000 $ 1,585,000
Public Safety 1 -20 -96 2,015,000 2,015,000
Library 1 -20-96 3,525,000 3,525,000
Parks & Recreation 1 -20-96 4,705,000 4,705,000
Public Works 1 -20-96 9,755,000 9,755,000
Maintenance Facility 1 -20 -96 910,000 910,000 -
$ 30,910,000 $ 29,325,000 $ 1,585,000
Anticipated Issuance of General Obligation Bonds ... The City does anticipate issuing additional general obligation debt
during the next twelve month period.
Funded Debt Limitation ... No direct funded debt limitation is imposed on the City under current State law or the City's
Home Rule Charter. Article XI, Section 5 of the Texas Constitution is applicable to the City, and limits its maximum ad
valorem tax rate to $2.50 per $100 assessed valuation for all City purposes. The Home Rule Charter of the City limits its tax
rate to $1.20 per $100 Assessed Valuation for all City purposes.
Other Obligations ... The City annually enters into a lease purchase agreement for equipment acquisition. The lease balance
as of September 30, 1997 was $1,609,044 with final maturity scheduled to occur by September 30, 2003.
Pension Fund ... The City provides pension benefits for all of its full -time employees through the Texas Municipal
Retirement System (" TMRS"), a State -wide administered pension plan. The City makes annual contributions to the plan equal
to the amounts accrued for pension expense. (For more detailed information concerning the retirement plan, see APPENDIX B
- " Excerpts from the City's Annual Financial Report" - Note 8 8).
22
Table 9 - General Fund Revenues and Expenditures
1997 1996 1995 1994 1993
Revenues.
Taxes $ 17,355,288 9 13,926,639 $ 11,803,926 $ 9,322,242 9 7,910,542
Licenses and Permits 515,852 539,241 576,718 583,935 387,776
Charges for Services 1,318,516 1,210,486 951,760 765,287 629,454
Fine and Forfeitures 648,388 637,471 496,577 632,967 520,159
Miscellaneous 1,379,563 883,538 704,072 394,190 694,793
Total Revenues $ 21,217,607 9 17,197,375 $ 14,533,053 $ 11,698,621 $ 10,142,724
Expenditures:
General Government 9 5,577,920 9 3,925,058 $ 3,444,821 $ 2,571,601 $ 2,118,627
Public Safety 8,047,235 6,803,488 5,875,865 4,641,358 4,411,114
Public Works 2,981,616 2,543,184 2,133,271 1,871,751 1,919,195
Culture and Recreation 2,971,467 2,466,848 2,132,717 1,798,141 1,611,799
Total Expenditures $ 19,578,238 9 15,738,578 $ 13,586,674 9 10,882,851 $ 10,060,735
Excess (Deficiency) of
Revenues over Expenditures 9 1,639,369 $ 1,458,797 9 946 ,379 $ 815,770 9 81,989
Budgeted Transfers le $ 1,449,075 $ 1,300,000 $ 1,250,017 $ 1,200,000 $ 1,139,000
Budgeted Transfers Out (788,228) (1,057,805) (1,800,700) (801,409) (431,200)
Total Transfers 9 660,847 $ 242,195 $ (550,683) $ 398.591 9 707,800
Net Increase (Decrease) 9 2,300,216 $ 1,700,992 9 395,696 $ 1,214 ,361 $ 789,789
Other Miscellaneous Adjustments - - -
Beginning Fund Balance 8,430,942 6,729,950 6,334,254 5,119,893 4 ,330,104
Ending Fund Balance $ 10,731,158 8 8,430.942 $ 6,729,950 $ 6 ,334,254 $ 5,119,893
(1) Includes lease purchase financing proceeds.
Table 10 - Municipal Sales Tax History
For Fiscal Year Ended September 30,
The City has adopted the Municipal Sales and Use Tax Act, Chapter 321, Texas Tax Code, V.T.CA, which grants the City the
power to impose and levy a 1 K% Local Sales and Use Tax within the City, the proceeds are credited to the General Fund and
are not pledged to the payment of the Bonds or the Certificates. The City also approved an election in August of 1997 to levy
an additional %a cent for economical development, which the City plans to dedicate to road improvements. Collections and
enforcements are effected through the offices of the Comptroller of Public Accounts of the State of Texas, who remits the
proceeds of the tax, after deduction of a 2% service fee, to the City monthly.
(1)
FINANCIAL INFORMATION
Fiscal Equivalent
Year % of of
Ended Total Ad Valorem Ad Valorem Per
9 -30 Collected Tax Levy Tax Rate Capita
1992 $ 3,231,220 59.85% $ 0.3534 $ 95.69
1993 4,159,852 72.86% 0.3858 115.11
1994 5,069,127 82.59% 0.3610 128.11
1995 7,144,297 103.48% 0.4249 164.24
1996 8,974,450 123.02% 0.4540 206.31
1997 11,689,671 133.30% 0.5026 251.67
Based on estimated or U. S. Census population for all years.
23
Financial Administration ... The Financial Department is responsible for providing all City financial services including
financial accounting and reporting, payroll and accounts payable disbursement functions, cash and investment management,
debt management, purchasing, pension administration, utility customer services, municipal court, internal audit and special
financial, and policy analysis for City management The Director of Finance, appointed by the City Council, supervises the
Department's operations.
The City employs a computerized financial accounting system which includes a system of internal accounting controls. Such
controls have been designed and are continually being re- evaluated to provide reasonable, but not absolute, assurance
regarding: 1) the safeguarding of assets against lass from unauthorized use or disposition, and 2) the reliability of financial
records for preparing financial statements and maintaining accountability of assets.
The concept of reasonable assurance recognizes the cost of a control should not exceed the benefits likely to be derived, and the
evaluation of costs ad benefits requires estimates and judgments by management. All internal control evaluations occur within
this framework, and are believed to adequately safeguard assets and provide reasonable assurance of proper recording of
financial transactions.
Accounting records for governmental fund types are maintained on a modified accrual basis, with revenues being recognized
when available and measurable and expenditures being recognized when services or goods are received and the liabilities
incurred. Accounting records for proprietary fund types and similar trust funds are maintained on the accrual basis.
The annual operating budget, or financial plan, is proposed by the City Manager and enacted by the City Council after public
discussion. Management control for the operating budget is maintained at the department level. Subsequent budget
amendments within a department must be approved by the City Manager. All others must be approved by the City Council.
Any unappropriated balances at year -end lapse.
In 1991, the City Council directed management to improve accounting and budgetary controls and the communication of
financial data to the Council, employees, citizens and other interested parties. Management determined that simplifying the
structure of funds would be beneficial in meeting this directive. Funds were analyzed to determine which funds were necessary
to comply with laws and regulations and provide sound financial administration. All other funds were consolidated into the
General Fund.
There were no legal restrictions on revenues or expenditures of the affected special revenue funds that required separate fund
accounting. While the nature of activities included in the enterprise and internal service funds which were combined could
have been proprietary, the actual operations and management of the funds was more consistent with that of a governmental -type
fund. Financial accounting and budgetary controls were maintained on a governmental fund -type basis, except for purposes of
year end financial reporting.
Among other benefits, consolidation would help insure that financial needs were matched with measurable and available
resources on an annual basis, and that interim financial data was more available on an aggregate basis for the City. The City
Council approved the recommended consolidation of funds.
Financial Policies
Basis of Accounting ...The City's accounting records of the governmental fund revenues and expenditures are recognized as
the modified accrual basis. Revenues are recognized in the accounting period in which they are available and measurable.
Expenditures are recognized in the accounting period in which the fund liability is incurred, if measurable, except for
unmatured interest on general long -term debt
The accrual basis of accounting is utilized by proprietary funds. Under the acmnal basis of accounting, revenues are recognized
in the accounting period in which they are earned and become measur able. Expenses are recorded in the accounting period
incurred, if measurable.
General Fund Balance .. .The City policy is to maintain working capital resources at a minimum of three (3) months of the
General Fmd operating expenditure budget This allows the City to avoid interim borrowing pending tax receipts and provides
flexibility should actual revenues fall short of budget estimates.
Use of Bond Proceeds, Grants, etc . . .The City's policy is to use bond proceeds, grants, revenue sharing or other non -
recurring revenues for capital expenditures only. Such revenues are never to be used to fund City operations.
24
Budgetary Procedures ...The City Charter establishes the City's fiscal year as the twelve -month period beginning October 1.
The departments submit to the City Manager a budget of estimated expenditures for the ensuing fiscal year. The City Manager
subsequently submits a budget of estimated expenditures and revenues to the City Council by August 1. The City Council then
holds public hearings on the budget after giving at least seven days notice of the hearing in the official newspaper of the City.
The City Council shall then make any changes in the budget as it deems advisable and adopts a budget not later than the 27th
day of the last month of the fiscal year.
During the fiscal year, budgetary control is maintained by the review of departmental appropriation balances with purchase
orders prior to their release to vendors.
Departmental appropriations that have not been encumbered lapse at the end of the fiscal year. Therefore, funds that were
budgeted and not used by the departments during the fiscal year are not available for their use unless appropriated by the City
Council in the ensuing fiscal year's budget.
INVESTMENTS
The City of Round Rock invests its investible funds in investments authorized by Texas law in accordance with investment
policies approved by the City Council of the City of Round Rock Both State law and the City's investment policies are subject
to change.
Legal Investments ... Under State law, the City is authorized to invest in (1) obligations of the United States or its agencies
and instrumentalities, (2) direct obligations of the State or its agencies and instrumentalities, (3) collateralized mortgage
obligations directly issued by a federal agency or instrumentality of the United States, the underlying security for which is
guaranteed by an agency or instrumentality of the United States, (4) other obligations, the principal of and interest on which are
unconditionally guaranteed or insured by, or backed by the full faith and credit of, the State or the United States or their
respective agencies and instrumentalities, (5) obligations of states, agencies, counties, cities, and other political subdivisions of
any state rated as to investment quality by a nationally recognized investment rating firm not less than A or its equivalent, (6)
certificates of deposit issued by a state or national bank domiciled in Texas or a savings and loan association domiciled in
Texas that are guaranteed or insured by the Federal Deposit Insurance Corporation or are secured as to principal by obligations
described in clauses (1) through (5) or in any other manner and amount provided by law for City deposits, (7) certificates of
deposit and share certificates issued by a state or federal credit union domiciled in the State that are guaranteed or insured by
the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund, or are secured as to principal by
obligations described in the clauses (1) through (5) or in any other manner and amount provided by law for City deposits, (8)
fully collateralized repurchase agreements that have a defined termination date, are fully secured by obligations described in
clause (1), and are placed through a primary government securities dealer or a financial institution doing business in the State,
(9) bankers' acceptances with the remaining term of 270 days or less, if the short-term obligations of the accepting bank or its
parent are rated at least A -1 or P -1 or the equivalent by at least one nationally recognized credit rating agency, (10) commercial
paper that is rated at least A -I or P -I or the equivalent by either (a) two nationally recognized credit rating agencies or (b) one
nationally recognized credit rating agency if the paper is fully secured by an irrevocable letter of credit issued by a United
States or state bank, (11) no-load money market mutual funds regulated by the Securities and Exchange Commission that have
a dollar weighted average portfolio maturity of 90 days or less and include in their investment objectives the maintenance of a
stable net asset value of $1 for each share, and (12) no-load mutual funds registered with the Securities and Exchange
Commission that have an average weighted maturity of less than two years, invests exclusively in obligations described in the
preceding clauses; and are continuously rated as to investment quality by at least one nationally recognized investment rating
firm of not less than AAA or its equivalent.
The City may invest in such obligations directly or through government investment pools that invest solely in such obligations
provided that the pools are rated no lower than AAA or AAA- or an equivalent by at least one nationally recognized rating
service. The City is specifically prohibited from investing in: (1) obligations whose payment represents the coupon payments
on the outstanding principal balance of the underlying mortgage-backed security collateral and pays no principal; (2)
obligations whose payment represents the principal stream of cash flow from the underlying mortgage - backed security and
bears no interest (3) collateralized mortgage obligations that have a stated final maturity of greater than 10 years; and (4)
collateralized mortgage obligations the interest rate of which is determined by an index that adjusts opposite to the changes in a
market index.
Investment Polides ... Under State law, the City is required to invest its funds under written investment 'Aides that
ley emphasize safety of principal and liquidity, that address investment diversification, yield, maturity, and the quality
and capability of investment management; and that includes a list of authorized investments for City fuels, maximum
allowable stated maturity of any individual investment and the maximum average dollar- weighted maturity allowed for pooled
fund groups. All City funds must be invested consistent with a formally adopted "investment Strategy Statement that specifically
addresses each thuds' investment Each Investment Strategy Statement must describe the investment objectives for the particular fiord
25
using the following priorities: (1) suitability of investment type; (2) preservation and safety of principal; (3) liquidity, (4) marketability
of each investment; (5) diversification of the portfolio; and (6) yield.
Under State law, City investments must be made "with judgment and care, under prevailing circumstances, that a person of
prudence, discretion, and intelligence would exercise in the management of the person's own affairs, not for speculation, but
for investment, considering the probable safety of capital and the probable income to be derived." At least quarterly the
investment officers of the City shall submit an investment report detailing: (1) the investment position of the City, (2) that all
investment officers jointly prepared and signed the report; (3) the beginning market value, any additions and changes to market
value and the ending value of each pooled fund group; (4) the book value and market value of each separately listed asset at the
beginning and end of the reporting period; (5) the maturity date of each separately invested asset; (6) the account or fund or
pooled fund group for which each individual investment was acquired; and (7) the compliance of the investment portfolio as it
relates to: (a) adopted investment strategy statements and (b) State law. No person may invest City funds without express
written authority from the City Council.
Additional Provisions ... Under State law the City is additionally required to: (1) smuttily review its adopted policies and
strategies, (2) require any investment officers' with personal business relationships or relatives with firms seeking to sell securities to
the entity to disclose the relationship and file a statement with the Texas Ethics Commission and the City Council; (3) require the
registered principal of firms seeking to sell securities to the City to: (a) nzcivc and review the City's investment policy, (b) acknowledge
that reasonable controls end procedures have been implemented to preclude imprudent investment activities, and (c) deliver a written
statement attesting to these requirements (4) perform an annual audit of the management controls on investments and adherence to the
City's investment policy, (5) provide specific investment training for the Treasurer, Chief Financial Officer and investment of cars; (6)
restrict reverse repurchase agreements to not more than 90 days and restrict the investment of reverse repurchase agreement funds to no
greater than the term of the reverse repurchase agreement; (7) restrict the investment in mutual funds in the aggregate to no more than
80% of the City's monthly average fund balance, excluding bond proceeds and reserves and other funds held for debt service and further
restrict the investment in non -money market mutual funds of any portion of bond proceeds, reserves and funds held for debt service and
to no more than 15% of the entity's monthly average fwd balance, excluding bond proceeds and reserves and other funds held for debt
service; and (8) require local government investment pools to c onfam to the new disclosure, rating, net asset value, yield calculation,
and advisory board requirements.
Current Investments ... The City is currently invested in a portfolio of U.S. Treasury Securities, Federal Ilome Loan Bank
Discount Notes, Federal Home Loan Mortgage Corporation Discount Notes, Federal National Mortgage Assn. Discount Notes,
Commercial Paper, FFCB Notes and a government investment pool (Texpool) which complies with the above -noted legal
investment criteria
Under City investment criteria, other securities or investment instruments may be added to the City's investment portfolio
which are approved under State law as authorized investments for municipal govemments and which are further approved by
the City Attorney and the Director of Finance.
The City's investment portfolio is generally representative of the City's investment practices although the City has in the past
or may in the future also invest in other investments approved by the City Council which meet the above -noted legal criteria.
Pursuant to State law, not less than quarterly, the investment officer must prepare a written report on investment transactions
which includes the beginning and ending market value of investments for such period. Based upon the most recent valuation of
its investments which occurred September 30, 1997, the City reports its investments totaling $64,590,757 in book value had a
market value of $64,618,265 or 100.04% of book value.
TAX MATTERS
OPINION ... On the date of initial delivery of the Bonds and Certificates, McCall, Parkhurst & Horton L.L.P., Austin, Texas,
Bond Counsel, will render their opinion that, in accordance with sue, regulations, published rulings and court decisions
existing on the date thereol; (1) interest on the Bonds and Certificates for federal income tax purposes will be excludable from
the "gross income" of the holders thereof and (2) the Bonds and Certificates will not be treated as 'private activity bonds" the
interest on which would be included as an alternative minimum tax preference item under section 57(aXS) of the Internal
Revenue Code of 1986 ( the " Code"). Except as stated above, Bond Counsel will express no opinion as to any other federal,
state or local tax consequences of the purchase, ownership or disposition of the Bonds and Certificates. See APPENDIX C -
"Form of Opinion of Bond Counsel".
In rendering their opin ion, Band Counsel will rely upon (a) the City's federal tax certificate and (b) the verification report of
Grant Thornton LLP independent certified public accountants covenants of the City with respect to arbitrage, the application of
the proceeds to be received from the issuance and sale of the Bonds and Certificates and certain other matters. Failure of the
City to comply with these representations or covenants could cause the interest on the Bonds and Certificates to become
includable in gross income retroactively to the date of issuance of the Bonds and Certificates.
26
The law upon which Bond Counsel have based their opinion is subject to change by the Congress and to subsequent judicial
and administrative interpretation by the courts and the Department of the Treasury. There can be no assurance that such law or
the interpretation thereof will not be changed in a manner which would adversely affect the tax treatment of the purchase,
ownership or disposition of the Bonds and Certificates.
FEDERAL INCOME TAX ACCOUNTING TREATMENT or ORIGINAL Issue DISCOUNT ... The initial public offering price to be paid
for certain Bonds and Certificates (the "Original Issue Discount Bonds" and "Original Issue Discount Certificates ") may be less
than the principal amount thereof The difference between (i) the amount payable at the maturity of each Original Issue
Discount Bond and Original Issue Discount Certificate, and (ii) the initial offering price to the public of such Original Issue
Discount Bond and Original Issue Discount Certificate would constitute original issue discount with respect to such Original
Issue Discocmt Bond and Original Issue Discount Certificate in the hands of any owner who has purchased such Original Issue
Discount Bond or Original Issue Discount Certificate in the initial public offering of the Bonds and Certificates. Under
existing law, such initial owner is entitled to exclude from gross income (as defined in Section 61 of the Code) an amount of
income with respect to such Original Issue Discount Bond and Original Issue Discount Certificate equal to that portion of the
amount of such original issue discount allocable to the period that such Original Issue Discount Bond or Original Issue
Discount Certificate continues to be owned by such owner. For a discussion of certain collateral federal tax consequences, see
discussion set forth below.
In the event of the redemption, sale or other taxable disposition of such Original Issue Discount Bond or Original Issue
Discount Certificate prior to stated maturity, however, the amount realized by such owner in excess of the basis of such
Original Issuc Discount Bond or Original Issue Discount Certificate in the hands of such owner (adjusted upward by the portion
of the original issue discount allocable to the period for which such Original Issue Discount Bond or Original Issue Discount
Certificate was held by such initial owner) is includable in gross income.
Under existing law, the original issue discount on each Original Issue Discount Bond and Original Issue Discount Certificate is
accrued daily to the stated maturity thereof (in amounts calculated as described below for each six -month period ending on the
date before the semiannual anniversary dates of the date of the Bonds and Certificates and ratably within each such six -month
period) and the accrued amount is added to an initial owner's basis for such Original Issue Discount Bond and Original Issue
Discount Certificate for purposes of determining the amount of gain or loss recognized by such owner upon the redemption,
sale or other disposition thereof. The amount to be added to basis for each accrual period is equal to (a) the sum of the issue
price and the amount of original issue discount accrued in prior periods multiplied by the yield to stated maturity (determined
on the basis of compounding at the close of each accrual period and properly adjusted for the length of the accrual period) less
(b) the amounts payable as current interest during such accrual period on such Bond or Certificate.
The federal income tax consequences of the purchase, ownership, redemption, sale or other disposition of Original Issue
Discount Bonds or Original Issue Discount Certificates which are not purchased in the initial offering at the initial offering
price may be determined according to rules which differ from those described above. All owners of Original Issue Discount
Bonds and Original Issue Discount Certificates should consult their own tax advisors with respect to the determination for
federal, state and local income tax purposes of the treatment of interest accrued upon redemption, sale or other disposition of
such Original Issue Discount Bonds and Original Issue Discount Certificates and with respect to the federal, state, local and
foreign tax consequences of the purchase, ownership, redemption, sale or other disposition of such Original Issue Discount
Bonds and Original Issue Discount Certificates.
COLLATERAL FEDERAL. INCOME TAX CONSEQUENCES ... The following discussion is a summary of certain collateral federal
income tax consequences resulting from the purchase, ownership or disposition of the Bonds and Certificates. This discussion
is based on existing statutes, regulations, published rulings and court decisions, all of which are subject to change or
modification, retroactively. The following discussion is applicable to investors, other than those who are subject to special
provisions of the Code, such as financial institutions, property and casualty insurance companies, life insurance companies,
owners of an interest in a FAS1T, individual recipients of Social Security or Railroad Retirement benefits, individuals allowed
an earned income credit, certain S corporations with Subchapter C earnings and profits and taxpayers who may be deemed to
have inured or continued indebtedness to purchase tax-exempt obligations.
INVESTORS, INCLUDING THOSE WHO ARE SUBJECT TO SPECIAL PROVISIONS OF THE CODE, SHOULD
CONSULT THEIR OWN TAX ADVISORS AS TO THE TAX TREATMENT WHICH MAY BE ANTICIPATED TO RESULT
FROM THE PURCHASE, OWNERSHIP AND DISPOSITION OF TAX - EXEMPT OBLIGATIONS BEFORE DETERMINING
WHETHER TO PURCHASE THE BONDS AND CERTIFICATES.
Interest on the Bonds and Certificates will be includable as an adjustment for "adjusted earnings and profits" to calculate the
alternative minimum tax imposed on corporations by section 55 of the Code. Section 55 of the Code imposes a tax equal to 20
percent for corporations, or 26 percent for non corporate taxpayers (28 percent for taxable income exceeding $175,000), of the
27
taxpayer's "alternative minimum taxable income," if the amount of such alternative minimum tax is greater than the taxpayer's
regular income tax for the taxable year.
Interest on the Bonds and Certificates may be subject to the "branch profits tax" imposed by section 884 of the Code on the
effectively- connected earnings and profits of a foreign corporation doing business in the United States.
Under section 6012 of the Code, holders of tax- exempt obligations, such as the Bonds and Certificates, may be required to
disclose interest received or accrued during each taxable year on their returns of federal income taxation.
Section 1276 of the Code provides for ordinary income tax treatment of gain recognized upon the disposition of a tax-exempt
obligation, such as the Bonds and Certificates, if such obligation was acquired at a "market discount" and if the fixed maturity
of such obligation is equal to or exceeds, one year from the date of issue. Such treatment applies to "market discount bonds"
and "market discount certificates" to the extent such gain does not exceed the accrued market discount of such bonds and
certificates; although for this purpose, a de minims amount of market discount is ignored. A "market discount bond" and
"market discount certificate" is one which is acquired by the holder at a purchase price which is less than the stated redemption
price at maturity or, in the case of a certificate issued at an original issue discount, the "revised issue price" (i.e., the issue
price plus accrued original issue discount). The "accrued market discount" is the amount which bears the same ratio to the
market discount as the number of days during which the holder holds the obligation bears to the number of days between the
acquisition date and the fund maturity date.
STATE, Lacer. AND FOREIGN TAXES ... Investors should consult their own tax advisors concerning the tax implications of the
purchase, ownership or disposition of the Bonds and Certificates under applicable state or local laws. Foreign investors should
also consult their own tax advisors regarding the tax consequences unique to investors who are not United States persons.
(THE REMAINDER OF TH S PAGE LEFT INTENTIONALLY BLANK)
28
CONTINUING DISCLOSURE OF INFORMATION
General ... In the Ordinance, the City has made the following agreement for the benefit of the holders and beneficial owners
of the Bonds and Certificates. The City is required to observe the agreement for so long as it remains obligated to advance
funds to pay the Bonds and Certificates. Under the agreement, the City will be obligated to provide certain updated financial
information and operating data annually, and timely notice of specified material events, to certain information vendors. This
information will be available to securities brokers and others who subscribe to receive the information from the vendors.
Annual Reports ... The City will provide certain updated financial information and operating data to certain information
vendors annually. The information to be updated includes all quantitative financial information and operating data with respect
to the City of the general type included in this Official Statement under Tables numbered 1 through 5, 8, 9, 10; information
under the subheading "INVESTMENTS - Current Investments" and financial statements in APPENDIX B. The City will
update and provide this information within six months after the end of each fiscal year ending in or after 1998. The City will
provide thc updated information to each nationally recognized municipal securities information repository ( "NRMSIR ") and to
any state information depository ("SID") that is designated by the State of Texas and approved by the State of Texas and
approved by the staff of the United States Securities and Exchange Commission (the "SEC ").
The City may provide updated information in full text or may incorporate by reference certain other publicly available
documents, as permitted by SEC Rule 15c2 -12. The updated information will include audited financial statements, if the City
commissions an audit and it is completed by the required time. If audited fumncial statements are not available by the required
time, the City will provide unaudited financial statements within the required time and will provide audited financial
statements when and if thc audit report becomes available. Any such financial statements will be prepared in accordance with
the accounting principles described in APPENDIX B or such other accounting principles as the City may be required to employ
from time to time pursuant to state law or regulation.
The City's current fiscal year end is September 30, 1998. Accordingly, it must provide updated information by March 30, in
each year, unless the City changes its fiscal year. If the City changes its fiscal year, it will notify each NRMSIR and the SID of
the change.
The Municipal Advisory Council of Texas has been designated by the State of Texas and approved by the SEC staff as e
qualified SID. The address of the Municipal Advisory Council of Texas is 600 West 8th Street, P. O. Box 2177, Austin, Texas
78768 -2177, and its telephone number is 512/476-6947.
Material Event Notices ... The City will also provide timely notices of certain events to certain information vendors. The
City will provide notice of any of the following events with respect to the Bonds and Certificates, if such event is material to a
decision to purchase or sell Bonds and Certificates: (1) principal and interest payment delinquencies; (2) non - payment related
defaults; (3) unscheduled draws on debt service reserves reflecting financial difficulties; (4) unscheduled draws on credit
enhancements reflecting financial difficulties; (5) substitution of credit or liquidity providers, or their failure to perform; (6)
adverse tax opinions or events affecting the tax - exempt status of the Bonds and Certificates; (7) modifications to rights of
holders of the Bonds and Certificates; (8) Bond and Certificate calls; (9) defeasances (10) release, substitution, or sale of
property securing repayment of the Bonds and Certificates; and (I1) rating changes. Neither the Bonds and the Certificates nor
the Ordinance make any provision for debt service reserves or liquidity enhancement. In addition, the City will provide timely
notice of any failure by the City to provide information, data, or financial statements in accordance with its agreement
described above under "Annual Reports." The City will provide each notice described in this paragraph to the SID and to
either each NRMSIR or the Municipal Securities Rulemaking Board ("MSRB").
Availability of Information from NRMSIRs and SID ... The City has agreed to provide the foregoing information only to
NRMSIRs and the SID. The information will be available to holders of Beads and Certificates only if the holders comply with
the procedures and pay the charges established by such information vendors or obtain the information through securities
brokers who do so.
Limitations and Amendments ... The City has agreed to update infanaation and to provide notices of material events only as
described above. The City has not agreed to provide other information that may be relevant or material to a complete
presentation of its financial results of operations, condition, or prospects or agreed to update any information that is provided,
except as described above. The City makes no representation or warranty concerning such information or concerning its
usefulness to a decision to invest in or sell Bonds and Certificates at any future date. The City disclaims any contractual or tort
liability for damages resulting in whole or in part from any breach of its continuing disclosure agreement or from any statement
made pursuant to its agreement, although holders and beneficial owners of Bonds and Certificates may seek a writ of
mandamus to compel the City to comply with its agreement.
29
The City may amend its continuing disclosure agreement from time to time to adapt to changed circumstances that arise from a
change in legal requirements, a change in law, or a change in the identity, nature, status, or type of operations of the City, if (i)
the agreement, as amended, would have permitted an underwriter to purchase or sell Bonds and Certificates in the offering
described herein in compliance with the Rule, taking into account any amendments or interpretations of the Rule to the date of
such amendment, as well as such changed circumstances, and (ii) either (a) the holders of a majority in aggregate principal
amount of the outstanding Bonds and Certificates consent to the amendment or (b) any person nnnffbliated with the City (such
as nationally recognized bond counsel) determines that the amendment will not materially impair the interests of the holders
and beneficial owners of the Bonds and Certificates. If the City so amends the agreement, it has agreed to include with the
next financial information and operating data provided in accordance with its agreement described above under "Annual
Reports" an explanation, in narrative form, of the reasons for the amendment and of the impact of any change in the type of
financial information and operating data so provided.
Compliance with Prior Undertakings ... The City has previously made a continuing disclosure agreement in accordance with
SEC Rule 15c2 -12 and is in compliance with such undertaking.
OTHER INFORMATION
Ratings ... The presently outstanding tax supported debt of the City is rated "Aa3" by Moody's and "A +" by S&P. Ratings for
the Bonds and Certificates have been requested from Moody's and S &P. An explanation of the significance of such ratings
may be obtained from the company furnishing the rating. The ratings reflect only the respective views of such organizations
and the City makes no representation as to the appropriateness of the ratings. There is no assurance that such ratings will
continue for any given period of time or that they will not be revised downward or withdrawn entirely by either or both of such
rating companies, if in the judgment of either or both companies, circumstances so warrant My such downward revision or
withdrawal of such ratings, or either of them, may have an adverse effect on the market price of the Bonds and Certificates.
Litigation ... It is the opinion of the City Attorney and City Staff that there is no pending litigation against the City that would
have a material adverse financial impact upon the City or its operations.
Registration and Qualification of Bonds and Certificates for Sale ... The sale of the Bonds and Certificates has not been
registered under the Federal Securities Act of 1933, as amended, in reliance upon the exemption provided thereunder by
Section 3(aX2); and the Bonds and Certificates have not been qualified under the Securities Act of Texas in reliance upon
various exemptions contained therein; nor have the Bonds and Certificates been qualified under the securities acts of any
jurisdiction. The City assumes no responsibility for qualification of the Bonds and Certificates under the securities laws of any
jurisdiction in which the Bonds and Certificates may be sold, assigned, pledged, hypothecated or otherwise transferred. This
disclaimer of responsibility for qualification for sale or other disposition of the Bonds and Certificates shall not be construed as
an interpretation of any kind with regard to the availability of any exemption from securities registration provisions.
Legal Investments and Eligibility to Secure Public Funds In Texas ... Section 9 of the Bond Procedures Act provides that
the Bonds and Certificates "shall constitute negotiable instruments, and are investment securities governed by Chapter 8, Texas
Uniform Commercial Code, notwithstanding any provisions of law or court decision to the contrary, and are legal and
authorized investments for banks, savings banks, trust companies, building and loan associations, savings and loan
associations, insurance companies, fiduciaries, and trustees, and for the sinking fund of cities, towns, villages, school districts,
and other political subdivisions or public agencies of the State of Texas ". The Bonds and Certificates are eligible to secure
deposits of any public funds of the state, its agencies and political subdivisions, and are legal security for those deposits to the
extent of their market value. For political subdivisions in Texas which have adopted investment policies and guidelines in
accordance with the Public Ftmds Investment Act (Ch. 2256, Texas Government Code, as amended), the Bonds and Certificates
may have to be assigned a rating of "A" or its equivalent as to investment quality by a national rating agency before such
obligations are eligible investments for sinking fiords and other public finds. No review by the City has been made of the laws
in other states to determine whether the Bonds and Certificates are legal investments for various institutions in those states.
Legal Opinions and No-Litigation ... The City will furnish complete transcripts of proceedings had incident to the
authorization and issuance of the Bonds and Certificates, including the respective unqualified approving legal opinions of the
Attorney General of Texas approving the Initial Bond and Initial Certificate and to the effect that the Bonds and Certificates are
valid and legally binding obligations of the City, and based upon examination of such transcript of proceedings, the respective
approving legal opinions of Bond Counsel, to like effect and to the effect that the interest on the Bonds and Certificates will be
excludable from gross income for federal income tax purposes under Section 103(a) of the Code, subject to the matters
described under `TAX MATTERS" herein, including the alternative minimum tax on corporations. The customary closing
papers, including a Certificate to the effect that no litigation of any nature has been filed or is then pending to restrain the
issuance and delivery of the Bonds and Certificates, or which would affect the provision made for their payment or security, or
in any manner questioning the validity of said Bonds and Certificates will also be furnished with respect to each issue. Bond
30
Counse1 was not requested to participate, and did not take part, in the preparation of the Notices of Sale and Bidding
Instructions, the Official Bid Forms and the Official Statement, and such firm has not assumed any responsibility with respect
thereto or undertaken independently to verify any of the information contained therein, except that, in its capacity as Bond
Counsel, such firm has reviewed the information describing the Bonds and Certificates in the Official Statement to verify that
such descriptions conforms to the provisions of each respective Ordinance. The legal fee to be paid Bond Counsel for services
rendered in connection with the issuance of the Bonds and Certificates is contingent on the sale and delivery of the Bonds and
Certificates. The legal opinions will accompany the Bonds and Certificates deposited with DTC or will be printed on the
Bonds and Certificates in the event of the discontinuance of the Book - Entry-Only System.
Authenticity of Financial Data and Other Information ... The financial data and other information contained herein have
been obtained from the City's records, audited financial statements and other sources which are believed to be reliable. There
is no guarantee that any of the assumptions or estimates contained herein will be realized. All of the summaries of the statutes,
documents and resolutions contained in this Official Statement are made subject to all of the provisions of such statutes,
documents and resolutions. These summaries do not purport to be complete statements of such provisions and reference is
made to such documents for further information. Reference is made to original documents in all respects.
Financial Advisor ... First Southwest Company is employed as Financial Advisor to the City in connection with the issuance
of the Bands and Certificates. The Financial Advisor's fee for services rendered with respect to the sale of the Bonds and
Certificates is contingent upon the issuance and delivery of the Bonds and Certificates. First Southwest Company may submit
a bid for the Bonds or Certificates, either independently or as a member of a syndicate organized to submit a bid for the Bonds
or Certificates First Southwest Company, in its capacity as Financial Advisor, has relied on the opinion of Bond Counsel and
has not verified and does not assume any responsibility for the information, covenants and representations contained in any of
the legal documents with respect to the federal income tax status of the Bonds and Certificates, or the possible impact of any
present, pending or future actions taken by any legislative or judicial bodies.
Certification of the Official Statement ... At the time of payment for and delivery of the Bonds and Certificates, the
respective Purchasers will be furnished Certificates, executed by proper officers, acting in their official capacity, to the effect
that to the best of their knowledge and belief (a) the descriptions and statements of or pertaining to the City contained in its
Official Statement, and any addenda, supplement or amendment thereto, on the date of such Official Statement, on the date of
sale of said Bonds and Certificates and the acceptance of the best bid therefor, and on the date of the delivery, were and are
true and correct in all material respects; (b) insofar as the City and its affairs, including its financial affairs, are concerned, such
Official Statement did not and does not contain an untrue statement of a material fact or omit to state a material fact required to
be stated therein or nee 'wary to make the statements therein, in the light of the circumstances under which they were made,
not misleading; (c) insofar as the descriptions and statements, including financial data, of or pertaining to entities, other than
the City, and their activities contained in such Official Statement are concerned, such statements and data have been obtained
from sources which the City believes to be reliable and the City has no reason to believe that they are untrue in any material
respect; and (d) there has been no material adverse change in the financial condition of the City since the date of the last
audited financial statements of the City.
The Ordinances authorizing the issuance of the Bonds and Certificates will also approve the form and content of this Official
Statement, and any addenda, supplement or amendment thereto, and authorize its further use in the reoffering of the Bonds and
Certificates by the Purchaser.
ATTEST:
JOANNE LAND
City Secretary
31
CHARLES C. CULPEPPER
Mayor
City of Round Rock, Texas
APPENDIX A
GENERAL INFORMATION REGARDING THE CITY
The City
The City of Round Rock is located in Williamson and Travis Counties, Texas, 8 miles north of Austin and 85 miles south of
Waco on Interstate Highway 35. The City is also situated on U.S. Highway 79 which runs east and west. Both U.S. Highway
79 and Interstate Highway 35 are main arteries of traffic in the State.
Economic Development
Round Rock has earned accolades both for its economic development efforts and its pro- business stance. The City has attracted
a number of high - technology companies, including Dell Computer, DuPont Photomask and Cypress Semiconductor. DuPont
Photomask broke ground earlier in the year on a worldwide headquarters facility at its Round Rock campus while Dell
Computer is completing work an its $120 million campus and is looking toward additional expansions.
Named by Texas Business Magazine in its June 1995 issue as the top choice in the State for business relocations and
expansions, Round Rock also is home to State Farm Insurance, Tcllubs Texas, Westinghouse and Sysco Foods. Other major
employers include McNeil Consumer Products, TN Technologies, MagRabbit Inc. and Weed Instruments. MaxServ, a wholly
owned subsidiary of Sears Robuck and Co., is constructing a 138,000 square foot facility on its newly acquired campus in
southeastern Round Rock. MnxServ, a provider of on -line and telephone support for appliance repair, will provide 1,000 new
jobs to Round Rock upon opening in late 1998.
Round Rock has become a magnet for business and industries, in large part because it has one of the most pro-business attitude
of any community in Central Texas. The City prides itself on a smooth development process and on a pragmatic political
leadership that extends a warm welcome to new employers.
The median household income of Round Rock residents, according to the 1990 U.S. Census, was $33,228. This compares with
$27,016 for Texas as a whole.
Round Rock has a young population: The median age is 30.9, Nearly 30 percent of Round Rock's residents aged 25 and over
have completed high school, and a slightly higher percentage have a college, graduate or professional degree. According to the
1990 U.S. Census, 26 percent of Round Rock residents hold professional positions, while 38 percent work in administrative or
sales jobs.
Manufacturing and high - technology industries have fueled Round Rock's growth. Since 1991, 35 businesses have located or
expanded in Round Rock, creating 12,866 jobs and investing more than 5300 million. The result has been close to full
employment Round Rock's unemployment rate is below 2 percent.
In addition to its corporate base, the City, which lies within Williamson County, boasts extensive entrepreneurial and
innovative talent. In fact, Williamson County generates more patents than any other county in the Austin MSA.
Major Industry
Industries located within the City's corporate limits and in the City's immediate surrounding area produce pharmaceuticals,
office products, computer systems and commtmication equipment. Various other industries and major employers such as the
school district are located in the Round Rock area. The following is a partial list of major employers and the number of people
they employ as of April, 1998.
Source: Round Rock Chamber of Commerce.
Company Employees
Dell Computer, Inc. 8,000+
Farmers Insurance Group, Inc. 850
AMP Packaging & Carroll Touch Systems 650
Westinghouse/TECO 550
Wayne Division - Dresser Industries, Inc. 485
Michael Angelo's Gourmet Food 450
Tellabs Texas, Inc. 439
Sysco Foods 387
Cypress Semirnndnctor, Inc. 300
DuPont Photomask 250
A -
Labor Market Profile
City of Round Rock, Texas
March 1998 March 1997
Total Civilian Labor Force 28,698 27,592
Total Employment 28,158 27,011
Total Unemployment 540 581
Percent Unemployment 1.9% 2.1%
State of Texas
March 1998 March 1997
Total Civilian Labor Force 4,974,727 9,750,200
Total Employment 9,516,876 9,214,600
Total Unemployment 457,851 535,600
Percent Unemployment 4.6% 5.5%
City Government and Community Services
The City is governed by a Council/Manager form of government with a Mayor and six councihnembers. The City has 1,026
acres of parks, which include eleven tennis courts, 22 baseball fields, 5 soccer fields, 2 swimming pools and other facilities that
are available to the community. A public, daily fee golf course is available for use. The Round Rock Leader, a weekly
newspaper, an Austin daily newspaper, and a public library with 83,000 volumes are just a few of the many community
services offered to the citizens of the City.
The Round Rock Hospital was completed in 1983 and is located on a 24 -acre site near Brushy Creek between the City and U.S.
Highway 183, The medical staff is currently comprised of approximately 100 active staff physicians with 65 of these
physicians having offices located in Round Rock. The Hospital's total medical staff totals more than 450 active and consulting
staff physicians. First Care Medical Clinic, a minor emergency and family practice clinic, is staffed by two primary care
physicians. Other hospital services are easily accessible in nearby Austin and Georgetown.
Financial Institutions
The City has access to twelve banks and one major savings and loan association.
Transportation
The City is easily accessible from the Austin Municipal Airport and Executive Airpark, a private airport located near the City.
Austin - Bergstrom International Airport is scheduled to be operational in 1998 or 1999. Two major railroads, two motor
freight lines and a bus line serve the City.
Education Facilities
The City is located entirely within one of the fastest growing school districts in the State, the Round Rock Independent School
District The District is comprised of 110 square miles with a current 1997 Net Taxable Assessed Valuation of
$2,325,756,421. The City is within 90 miles of six of the major universities in the State, including The University of Texas at
Austin, just 15 miles away. Southwestern University is located eight miles north in the City of Georgetown.
Recreation
Lake Travis, together with a number of other major lakes and parks, is in the vicinity to add recreational dimension to the area.
The hunting of deer, quail and mourning doves can also be enjoyed throughout this area. Each year, the weekend after the
Fourth of July, Round Rock holds Frontier Days, a 21 year tradition which attracts many people. The streets me lined with
entertainment, arts, crafts, food booths; and many events are scheduled all over town. The event has become an annual affair
and draws crowds of several thousand. Also, since 1980 the Chamber of Commerce has sponsored a Merchants Fair with over
60 booths, giving information about Round Rock businesses and services.
Utilities
The City is nerved by Southwestern Bell Telephone Company, Texas Utilities Electric Company and Lone Star Gas Company.
A -2
APPENDIX B
EXCERPTS FROM THE
CITY OF ROUND ROCK, TEXAS
ANNUAL FINANCIAL REPORT
For the Year Ended September 30, 1997
The information contained in this Appendix consists of excerpts from the City of Round
Rock, Texas Annual Financial Report for the Year Ended September 30, 1997, and is
not intended to be a complete statement of the City's financial condition. Reference is
made to the complete Report for further information.
APPENDIX C
FORM OF BOND COUNSEL'S OPINIONS
DATE: June 5, 1998
SUBJECT: City Council Meeting - June 11, 1998
ITEM: 13.C.1. Consider a Resolution Directing The Publication of Notice of
Intention to Issue City of Round Rock, Taros Combination Tux and
Revenue Certificates of Obligation, Series 1998; Approving The
Preliminary Official Statements; Authorizing Distribution of Such
Preliminary Official Statements and Other Matters Related Thereto.
The Certificates of Obligation are in the amount of $2,550,000, are
repayable from property taxes and will be used to complete construction
of the proposed $4.8 million Clay Madsen Recreation Center. Staff
Resource Person: David Kautz, Finance Director.
The City has applied for bond ratings for these obligations from Moody's Investors Service and
Standard and Poors. At the time of this writing, Moody's has indicated that the City's bond rating
is to be upgraded from Al to Aa3 in connection with these obligations. This "double -A" upgrade
reflects the excellent creditworthiness of the City and will enable the City to borrow funds at a
lower interest cost.