Fairbanks North Star Borough, Alaska General Obligation School Bonds, 2008 Series L $11,128,000
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Fairbanks North Star Borough, Alaska General Obligation School Bonds, 2008 Series L $11,128,000 Dated: Date of delivery Due: November 1, as shown on inside cover Book-Entry Only Ratings: Insured: Fitch Ratings: AAA Standard & Poor’s: AAA Uninsured: Fitch Ratings: A+ Standard & Poor’s: A+ Tax Exemption: Interest on the Bonds is excludable from gross income for federal income tax purposes. Page 4 Redemption: The Bonds are subject to redemption prior to their stated date of maturity. Page 1. Security: To secure payment of the Bonds, the Borough has covenanted that, unless the principal of and interest on the Bonds are paid from other sources, it will levy taxes annually without limitation as to rate or amount upon all property within the Borough subject to taxation in amounts sufficient to pay such principal and interest as the same shall become due. Page 2. The Bonds are eligible for reimbursement of 70 percent of debt service from the State of Alaska. Page 12 Purpose: The Bonds will be used to finance school improvements in the Borough. Page 11. Interest Payment Dates: May 1 and November 1, beginning November 1, 2008, and according to the schedules shown on inside cover. Sale: January 8, 2008. Closing: On or about January 25, 2008. Denominations: $5,000 or multiple thereof, except for one bond of $8,000 maturing in 2008. Registrar/Paying Agent: U.S. Bank National Association, Seattle, Washington Bond Counsel: K&L Preston Gates Ellis LLP, Seattle, Washington. Borough Attorney: René Broker, Fairbanks, Alaska. Financial Advisor: Bartle Wells Associates, Berkeley, California. Bond Insurer: The scheduled payment of principal of and interest on the Bonds when due will be guaranteed under a financial guaranty insurance policy to be issued concurrently with the delivery of the Bonds by Assured Guaranty Corp. This official statement is dated January 8, 2008. Syndicate Led by Robert W. Baird & Co., Inc. Griffin, Kubik, Stephens & Thompson, Inc. Stifel, Nicolaus & Company, Inc. Charles Schwab Hutchinson, Shockey, Erley & Co. Coastal Securities, Inc. KeyBanc Capital Markets Davenport & Co. L.L.C. Loop Capital Markets Maturity Schedule 2008 Series L Year Principal Interest CUSIP Year Principal Interest CUSIP Nov. 1 Amount Rate Yield 303531 Nov. 1 Amount Rate Yield 303531 2008.........$248,000 3.5000% 2.8600% XY8 2017*.......$525,000 3.8750% 3.6000% YH4 2009...........385,000 3.5000% 2.8300% XZ5 2018*.........550,000 4.0000% 3.7400% YJ0 2010...........400,000 3.5000% 2.8800% YA9 2019*.........575,000 4.0000% 3.8200% YK7 2011...........415,000 3.5000% 2.9600% YB7 2020*.........600,000 4.0000% 3.8800% YL5 2012...........430,000 3.5000% 3.0500% YC5 2021*.........630,000 4.0000% 3.9400% YM3 2013...........445,000 3.5000% 3.1300% YD3 2022...........660,000 4.0000% 4.0000% YN1 2014...........465,000 3.5000% 3.2000% YE1 2023...........690,000 4.0000% 4.0600% YP6 2015...........485,000 3.6250% 3.3000% YF8 2024...........725,000 4.0000% 4.1200% YQ4 2016...........505,000 3.6250% 3.4500% YG6 2025...........760,000 4.1250% 4.1800% YR2 $1,635,000 Rate 4.5000% Term Bonds Due November 1, 2027* Yield 4.2500% YT8 *Priced to 11/01/2016 Call Date FAIRBANKS NORTH STAR BOROUGH N Steese Hwy Elliott Hwy Alaska Railroad Chena Hot Springs Road Fairbanks North Pole Parks Hwy Richardson Hwy The Fairbanks North Star Borough is Alaska a local government unit analogous to a county with school district powers. The borough is located in central Alaska and covers 7,361 square miles, an area about the size of the state of Nome Fairbanks New Jersey. Anchorage Valdez Cordova Bethel Seward Homer Bering Sea 99 Gulf of Alaska [THIS PAGE INTENTIONALLY LEFT BLANK] Official Statement Fairbanks North Star Borough, Alaska Mail: PO Box 71267 Fairbanks, Alaska 99707-1267 Location: 809 Pioneer Road Fairbanks, Alaska 99701-2813 Incorporated January 1964 Jim Whitaker, Mayor Borough Assembly Members Luke Hopkins Kelly Brown Randy Frank Nadine Winters, Presiding Officer Guy Sattley Mike Musick Tim Beck Charlie Rex Victoria Foote, Deputy Presiding Officer Mona Lisa Drexler, Borough Clerk School Board Members Jennifer Schmidt Treasurer Leslie Hajdukovich President Kristina Brophy Member Sue Hull, Member Sharon McConnell Gillis, Vice-President Wendy Dominic, Clerk Howard Thies, Member Aunna Wilson, Student member Charles Rogers, Base Representative LTC Ron Johnson, Post Representative Borough Administration Bob Shefchik, Chief of Staff Michael E. Lamb, Chief Financial Officer A. René Broker, Borough Attorney Professional Services K&L Preston Gates Ellis LLP, Seattle, Bond Counsel Bartle Wells Associates, Berkeley, Financial Advisor U.S. Bank National Association, Seattle, Registrar/Paying Agent This official statement provides information about the Borough and its bonds. The official statement includes: 1. data supplied by the Borough and by others, as indicated herein; 2. estimates or projections, which may or may not be realized and which should not be construed as assertions of fact; and 3. summaries and descriptions of legal and financial documents, or their contents, which do not purport to describe such documents completely and which are made expressly subject to the full provisions of the documents cited. This official statement does not constitute a recommendation, express or implied, to purchase or not to purchase these bonds or any other previous bonds of the Borough. [THIS PAGE INTENTIONALLY LEFT BLANK] CONTENTS Fiscal Policies .................................... 29 THE BONDS ...................................... 1 Investments and Investment Practices31 Authority for Issuance ......................... 2 Risk Management and Insurance....... 32 Additional Bonds ................................. 2 Management Discussion .................... 33 Purpose................................................. 2 Security ................................................ 2 SCHOOL DISTRICT FINANCES. 35 Continuing Disclosure ......................... 3 School District Budget....................... 36 Approval of Legal Proceedings ........... 3 GENERAL AND ECONOMIC DATA Tax Exemption..................................... 3 ............................................................ 37 Absence of Litigation........................... 5 Location, History, Climate................. 37 Purchaser of the Bonds ........................ 5 Population and Housing..................... 38 Bond Insurance Policy......................... 6 Income................................................ 40 Ratings ................................................. 6 Cities .................................................. 40 Miscellaneous ...................................... 6 Employment....................................... 41 Execution of the Official Statement..... 7 Military .............................................. 43 FAIRBANKS NORTH STAR Health Care ........................................ 45 BOROUGH......................................... 8 Retail Sales ........................................ 46 Organization......................................... 8 Real Estate Activity ........................... 47 Responsibilities.................................... 9 Oil and Gas Industry.......................... 47 Cities .................................................. 10 FNSB Oil and Gas Operations........... 48 Relation to the School District........... 10 Mining................................................ 48 University of Alaska .......................... 49 FAIRBANKS NORTH STAR Transportation.................................... 49 BOROUGH SCHOOL DISTRICT 11 Community Facilities......................... 50 Organization....................................... 11 Tourism and Recreation..................... 51 Responsibilities.................................. 11 Enrollment and Facilities................... 11 Appendix A – Basic Financial Statements, THE CONSTRUCTION PROGRAM June 30, 2006 ............................................................ 12 Appendix B – Book Entry System STATE AID TO EDUCATION...... 13 School Debt Service Reimbursement 13 Appendix C – Continuing Disclosure Borough Reimbursement Eligibility.. 14 Undertaking School Operating Aid ........................ 16 Appendix D – Form of Bond Counsel BOROUGH FINANCES ................. 17 Opinion Funds and Accounts........................... 17 Appendix E – Bond Insurance and General Fund Financial Information.. 19 Financial Guaranty Assessed Valuation and Property Taxes Insurance Policy ............................................................ 21 Largest Taxpayers.............................. 23 Tax Rates ........................................... 24 Tax Levies and Delinquencies........... 26 Bonded Indebtedness ......................... 26 Borough Tax Limitation .................... 28 Budgetary Process.............................. 28 [THIS PAGE INTENTIONALLY LEFT BLANK] THE BONDS Description: Fairbanks North Star Borough General Obligation School Bonds $11,128,000 2008 Series L Bonds Date: Date of delivery Denomination: $5,000 or multiples thereof, except for one $8,000 bond maturing in 2008. Maturities: The Bonds are payable November 1, 2008 through November 1, 2027 in the amounts shown on the inside cover of this official statement. Interest: Interest is payable on May 1 and November 1 of each year to the respective dates of maturity, beginning November 1, 2008. Registrar / Paying Agent: The paying agent and registrar for the Bonds is U.S. Bank National Association, Seattle, Washington. Payment: The Bonds will be executed, sold, and