Le Sueur County, Minnesota Post-Issuance Compliance Policy

The Board of Commissioners (the “Board”) of Le Sueur County, Minnesota (the “County”) has chosen, by policy, to take steps to help ensure that all obligations will be in compliance with all applicable federal regulations. This policy may be amended, as necessary, in the future.

IRS Background The Internal Revenue Service (IRS) is responsible for enforcing compliance with the Internal Revenue Code (the “Code”) and regulations promulgated thereunder (“Treasury Regulations”) governing certain obligations (for example: tax-exempt obligations, Build America Bonds, Recovery Zone Development Bonds and various “Tax ” Bonds). The IRS encourages issuers and beneficiaries of these obligations to adopt and implement a post-issuance debt compliance policy and procedures to safeguard against post-issuance violations.

SEC Background T h e S e c u r i t i e s a n d E x c h a n g e C o m m i s s i o n ( S E C ) i s r e s p o n s i b l e f o r e n f o r c i n g c o m p l i a n c e w i t h t h e S E C R u l e 1 5 c 2 - 1 2 ( t h e “ R u l e ” ) . G o v e r n m e n t s o r g o v e r n m e n t a l e n t i t i e s i s s u i n g o b l i g a t i o n s g e n e r a l l y h a v e a r e q u i r e m e n t t o m e e t s p e c i f i c c o n t i n u i n g d i s c l o s u r e s t a n d a r d s s e t f o r t h i n c o n t i n u i n g d i s c l o s u r e a g r e e m e n t s ( “ C D A ” ) . U n l e s s t h e i s s u e r , o b l i g a t e d p e r s o n , o r a s p e c i f i c o b l i g a t i o n i s e x e m p t f r o m c o m p l i a n c e w i t h C D A s , t h e s e a g r e e m e n t s a r e e n t e r e d i n t o a t t h e t i m e o f o b l i g a t i o n i s s u a n c e t o e n a b l e u n d e r w r i t e r ( s ) t o c o m p l y w i t h t h e R u l e . T h e R u l e s e t s f o r t h c e r t a i n o b l i g a t i o n s o f ( i ) u n d e r w r i t e r s t o r e c e i v e , r e v i e w a n d d i s s e m i n a t e o f f i c i a l s t a t e m e n t s p r e p a r e d b y i s s u e r s o f m o s t p r i m a r y o f f e r i n g s o f m u n i c i p a l s e c u r i t i e s , ( i i ) u n d e r w r i t e r s t o o b t a i n C D A s f r o m i s s u e r s a n d o t h e r o b l i g a t e d p e r s o n s t o p r o v i d e m a t e r i a l e v e n t d i s c l o s u r e a n d a n n u a l f i n a n c i a l i n f o r m a t i o n o n a c o n t i n u i n g b a s i s , a n d ( i i i ) b r o k e r - d e a l e r s t o h a v e a c c e s s t o s u c h c o n t i n u i n g d i s c l o s u r e i n o r d e r t o m a k e r e c o m m e n d a t i o n s o f m u n i c i p a l s e c u r i t i e s t r a n s a c t i o n s i n t h e s e c o n d a r y m a r k e t . The SEC encourages issuers and beneficiaries adopt and implement a post-issuance debt compliance policy and procedures to safeguard against Rule violations.

W h e n o b l i g a t i o n s a r e i s s u e d , t h e C D A c o m m i t s t h e i s s u e r o r o b l i g a t e d p e r s o n t o p r o v i d e c e r t a i n a n n u a l f i n a n c i a l i n f o r m a t i o n a n d m a t e r i a l e v e n t n o t i c e s t o t h e p u b l i c . I s s u e r s a n d o t h e r o b l i g a t e d p e r s o n s m a y a l s o c h o o s e t o p r o v i d e p e r i o d i c , v o l u n t a r y f i n a n c i a l i n f o r m a t i o n a n d f i l i n g s t o i n v e s t o r s i n a d d i t i o n t o f u l f i l l i n g t h e s p e c i f i c r e s p o n s i b i l i t i e s d e l i n e a t e d i n t h e i r C D A . I t i s i m p o r t a n t t o n o t e t h a t i s s u e r s a n d o t h e r o b l i g a t e d p e r s o n s s h o u l d n o t g i v e a n y o n e i n v e s t o r c e r t a i n i n f o r m a t i o n t h a t i s n o t r e a d i l y a v a i l a b l e t o a l l m a r k e t p a r t i c i p a n t s b y d i s s e m i n a t i n g i n f o r m a t i o n t o t h e m a r k e t p l a c e , a t l a r g e . I s s u e r s a n d o t h e r o b l i g a t e d p e r s o n s s h o u l d b e a w a r e t h a t a n y d i s c l o s u r e a c t i v i t i e s d e t e r m i n e d t o b e “ c o m m u n i c a t i n g t o t h e m a r k e t ” c a n b e s u b j e c t t o r e g u l a t o r y s c r u t i n y .

Post-Issuance Debt Compliance Policy Objective The County desires to monitor these obligations to ensure compliance with the IRS Code, Treasury Regulations and the SEC Rule. To help ensure compliance, the County has developed the following policy (the “Post-Issuance Debt Compliance Policy”). The Post- Issuance Debt Compliance Policy shall apply to the obligations mentioned above, including bonds, notes, , lease purchase contracts, lines of credit, commercial paper or any other form of debt that is subject to compliance.

Post-Issuance Debt Compliance Policy The C o u n t y A u d i t o r - T r e a s u r e r of the County is designated as the County’s agent who is responsible for post-issuance compliance of these obligations.

The C o u n t y A u d i t o r - T r e a s u r e r shall assemble all relevant documentation, records and activities required to ensure post-issuance debt compliance as further detailed in corresponding procedures (the “Post-Issuance Debt Compliance Procedures”). At a minimum, the Post-Issuance Debt Compliance Procedures for each qualifying obligation will address the following:

1. General Post-Issuance Compliance 2. General Recordkeeping 3. Arbitrage Yield Restriction and Rebate Recordkeeping 4. Expenditure and Asset Documentation to be Assembled and Retained 5. Miscellaneous Documentation to be Assembled and Retained 6. Additional Undertakings and Activities that Support Sections 1 through 5 above 7. Continuing Disclosure Obligations 8. Compliance with Future Requirements

The C o u n t y A u d i t o r - T r e a s u r e r shall apply the Post-Issuance Debt Compliance Procedures to each qualifying obligation and maintain a record of the results. Further, the C o u n t y A u d i t o r - T r e a s u r e r will ensure that the Post-Issuance Debt Compliance Policy and Procedures are updated on a regular and as needed basis.

The C o u n t y A u d i t o r - T r e a s u r e r or any other individuals responsible for assisting the C o u n t y A u d i t o r - T r e a s u r e r in maintaining records needed to ensure post-issuance debt compliance, are authorized to expend funds as needed to attend training or secure use of other educational resources for ensuring compliance such as consulting, publications, and compliance assistance.

Most of the provisions of this Post-Issuance Debt Compliance Policy are not applicable to taxable governmental obligations unless there is a reasonable possibility that the County may refund their taxable governmental obligation, in whole or in part, with the proceeds of a tax-exempt governmental obligation. If this refunding possibility exists, then the C o u n t y A u d i t o r - T r e a s u r e r shall treat the taxable governmental obligation as if such issue were an issue of tax-exempt governmental obligations and comply with the requirements of this Post-Issuance Debt Compliance Policy.

Private Activity Bonds The County may issue tax-exempt obligations that are “private activity” bonds because either (1) the bonds a facility that is owned by the County but used by one or more qualified 501(c)(3) organizations, or (2) the bonds are so-called “conduit bonds”, where the proceeds are loaned to a qualified 501(c)(3) organization or another private entity that activities eligible for tax-exempt financing under federal (such as certain manufacturing projects and certain affordable housing projects). Prior to the issuance of either of these types of bonds, the C o u n t y A u d i t o r - T r e a s u r e r shall take steps necessary to ensure that such obligations will remain in compliance with the requirements of this Post-Issuance Debt Compliance Policy.

In a case where compliance activities are reasonably within the control of a private party (i.e., a 501(c)(3) organization or conduit borrower), the C o u n t y A u d i t o r - T r e a s u r e r may determine that all or some portion of compliance responsibilities described in this Post- Issuance Debt Compliance Policy shall be assigned to the relevant party. In the case of conduit bonds, the conduit borrower will be assigned all compliance responsibilities other than those required to be undertaken by the County under federal law. In a case where the C o u n t y A u d i t o r - T r e a s u r e r is concerned about the compliance ability of a private party, the C o u n t y A u d i t o r - T r e a s u r e r may require that a trustee or other independent third party be retained to assist with record keeping for the obligation and/or that the trustee or such third party be responsible for all or some portion of the compliance responsibilities.

The C o u n t y A u d i t o r - T r e a s u r e r is additionally authorized to seek the advice, as necessary, of counsel and/or its financial advisor to ensure the County is in compliance with this Post-Issuance Debt Compliance Policy.

Adopted this date______by Le Sueur County, Minnesota