PRESENTATION TO STANDARD & POOR’S BY The City of Steubenville, Municipal Building Improvement Bonds, Series 2010

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October 21, 2010 Table of Contents SECTION I: Rating Presentation by the City of Steubenville, Ohio

Cathy Davison, City Manager Alyssa Kerker, Finance Director Michelle Hillstrom, Underwriter SECTION II: Strategic Plan 2010-2020 SECTION III: Statement of Financial Policy SECTION IV: Investment and Deposit Policy is

City Complex

is Quality of Life: Location

Steubenville is the County Seat of Jefferson County, Ohio.

The City is located in the tri- State Region of Ohio, and West Virginia.

Due to it proximity, the City is considered a suburb of , Pennsylvania. is

Downtown Pittsburgh is 36 miles from the Veterans' Memorial Bridge, which brings U.S. Route 22 across the and into Steubenville.

More than 41,000 cars and trucks cross the Veterans' Memorial Bridge daily.

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is Quality of Life: Location Continued

Downtown Steubenville is less than 30 miles from the Pittsburgh International Airport. The drive from Steubenville to the Pittsburgh airport is often quicker than from downtown Pittsburgh. The completion of the Findlay Connector shortened the drive time even further.

The Jefferson County Airpark is expanding its runway to 4,400 feet to accommodate larger airplanes. An extension to 5,000 feet is being planned. Fuel, hangars and conveniences for pilots are available at the Airpark.

Jefferson County has six ports on the Ohio River, more than iasny other county in Ohio. The Ohio River carries more freight tonnage than the Panama Canal and is at only 30 percent capacity.

Steubenville is serviced by the four-lane Highways U.S. Route 22 and State Route 7. Interstates 70, 76 and 79 are 30 miles away.

Improvements to U.S. 22 have helped make Pittsburgh an easy commute. It allowed Wal-Mart to build a massive 880,000-square-feet distribution center near the interchange with S.R. 43. The US 22/US 36/OH 16- corridor continues to hold promise as the most direct route between Pittsburgh and Columbus.

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is Quality of Life: Cultural Foundation

History: Steubenville and the communities that surround it, were historically defined by the steel industry. Corporations such as Mittal Steel (formerly Weirton Steel) and Severstal International (formerly Wheeling-Pittsburgh Steel Company), as well as various coalmines operating in eastern Ohio and in nearby West Virginia reduced or eliminated their workforce in order to become more efficient and competitive against other steel producers. In its heyday during the 1960s, Wheeling - Pittsburgh Steel employed more than 9,000 people at its Steubenville operations.

Present Day: Today, as the Steubenville Severstal Facility remains moth-balled, the City continues to re-invent itself. Perhaps the best feature of the City is its situation within the tri-state area. This "best-of-both-worlds" location allows residents to enjoy both small town living and also the benefits of being a "suburb" of the exciting, fast-paced city of Pittsburgh. The City’s cultural attributes include: is Those working in the Pittsburgh area enjoy significantly lower property taxes while living in Jefferson County. Steubenville City Schools is rated Excellent by the Ohio Department of Education. For a little history, education and culture, there is the Historic Fort Steuben, a reconstructed, 18th-century fort. Steubenville hosts three festivals-the Old Fort Steuben Festival, the Dean Martin Festival, and the Grecian Food Festival. The Dean Martin Festival is celebrated in honor of the actor and singer, who was born in Steubenville. Steubenville is home to many local parks including Pizza Pie Park, Beatty Park, Devonshire Park , Linda Way Park, Jim Wood Park and Belleview Park.

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is Local Economy: Healthcare

Trinity Health System comprises the most complete health care option in eastern Ohio. The hospital system includes Trinity East and Trinity West which has a combined capacity of over 470 beds and employs more than 1,800 people. The Health System is the City’s largest employer. The Trinity Health System Facilities include:

Trinity East offers a variety of services including Skilled Care, Long-term Care, Inpatient Physical Rehabilitation and Behavioral Medicine Services (Mental Health & Addiction Recovery.) Outpatient services include physical rehabilitation, cardiac rehabilitation and associated diagnostic services.

Trinity West is a full service acute care facility offering 24 hour emergency care, kidney dialysis, lithotripsy, endoscopy and related services, surgery and medical surgical inpatient units and all other diagnostic departments. is The Tony Teramana Cancer Center also provides Chemotherapy and surgical consultation services for regional residents. The Chemotherapy Services at The Tony Teramana Cancer Center is provided with compassion, privacy and optimum results.

The Trinity Outpatient Endoscopy Center offers gastroenterology patients a state-of- the-art facility for endoscopy procedures.

The Trinity Heart Center provides diagnosis, intervention, open heart surgery and rehabilitation for area cardiac patients. The Center opened in 2001 and has provided nearly 2,000 open heart procedures and 12,000 cardiac interventions.

The Women’s Health & Birth Center provides a full array of women’s health services from childbirth to surgical recovery.

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is Local Economy: Healthcare Continued

Riverside Medical is a multi-specialty physicians group that provides high-quality, cost-effective health care to the Ohio Valley and is one of the City’s top employers. Riverside has locations throughout Jefferson County and offers primary care, internal medicine, cardiology, gastroenterology, neurology, general surgery, vascular surgery, pulmonology, sports medicine and infectious disease care. In downtown Steubenville, the Heart, Vascular and Rhythm Center allows cardiac patients one location for all necessary testing including EKG, stress tests and pacemaker as well as a coumadin clinic, complete lab services and more. Five board- certified cardiologists are on staff and available 24 hours a day for emergency intervention.

Valley Surgery Center, opened in 2002 is located in Steubenville, is a freestanding multi-specialty surgery center owned by 15 lioscal surgeons. The Center is proud to offer state of the art equipment to provide unique surgical intervention such as CT guided sinus surgery, orthotripsy and PVP laser procedures. The "Center for Surgical Excellence" provides quality clinical and business office staff to care for its outpatient clients.

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is Local Economy: Higher Education

Franciscan University of Steubenville is a private school located in Steubenville that emphasizes the formation of strong, moral character and critical thinking. It enrolls over 2,000 students from all 50 states and over 40 foreign countries. It has been recognized as one of the best Catholic universities in the country by U.S. News and World Report, the Templeton Foundation, Barron's magazine, National Review and the National Catholic Register. Franciscan's business courses are the most popular in the curriculum; the elementary education program serves over 170 majors; the psychology and mental health and human services programs is have sent more than 335 graduates to 82 graduate schools throughout the country, all of whom have successfully completed their advanced degrees; the nursing graduates have achieved a high success rate in passing their state board exams; and the math, science and pre-med programs produce exemplary graduates. Franciscan University has earned an international reputation for its theology program as well. Grounded in Sacred Scripture rd and tradition, the program attracts more Franciscan University is the City’s 3 Largest Employer undergraduate theology majors than any other Catholic university or college in the country.

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is Local Economy: Higher Education continued The Eastern Gateway Community College is a public, two-year institution of higher education, the college brings affordable and accessible education to the Ohio Valley. Two-year associate degrees as well as numerous certificate programs of study are offered throughout the year. The college supplies accredited classes to prepare students for a career directly after college or to transfer college credits to four-year institutions. Career preparation classes are available in the areas of business, computers, engineering and information technologies, law enforcement, pre-kindergarten care, and health sciences. Many agreements exist between EGCC and other colleges and universities for transfer of EGCC credits. EGCC now has a building dedicated to the training and retraining of the Valley's workforce. The facility contains the latest in computer technology for short- or long-term customized training. The college also offers a wide variety of noncredit classes, ranging from computers to skill building and from senior topics to fitness.

The College is a focal point for many community activities. Cultural events, community service projects and entertainment activities are set throughout the year. Many nonpriosfit groups take advantage of the free use of the college's facilities.

EGCC is the City’s 4th Largest Employer

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is Local Economy: Commercial Base

Fort Steuben Mall This is an 823,049 square foot regional retail mall anchored by Macy' s, Sears, JC Penney, and Steve & Barry' s Sportswear, with Dick' s Sporting Goods and Wal-Mart Supercenter in freestanding structures at the site. Located ¼ mile from US 22 (primary east-west thoroughfare) providing direct commuter access to Pittsburgh to the east. The Fort Steuben Mall, which opened in 1974, is undergoing a modernization project which is expected to be completed this year. The modernization project allowed for the opening of the new Social Security offices in the mall. A new Aspen Dental building was constructed near the main entrance of the Mall earlier this year and held its grand opening in early summer.

is Gross Leasable Area: 823,049 SF Traffic Count: 105,000 Total Space Rentable: 62,764 SF Property Type: Shopping Center Property Sub-type: Regional Center

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is Local Economy: Commercial Base continued

Wal-Mart Distribution Center In 2002, Wal-Mart built an 800,000 square foot distribution center at the largest development site in eastern Ohio, located within five miles (8 km) of Steubenville. The new Findlay Connector that was built in had a large impact on the economy of Steubenville and was the primary catalyst for the Wal-Mart development. The trip between western Pittsburgh, an economically burgeoning area, and eastern Ohio and the northern panhandle of West Virginia has become even shorter and more streamlined. The connector is a toll-access highway between Pittsburgh International Airport at PA Route 60 and U.S. Route 22. Wal-Mart is the City’s 5th largest employer.

Downtown Historic Business District A can-do attitude has taken a firm hold on the historic downtown business district. Since the beginning of 2010, a variety of new and unique businesses have opened their doors in the downtown business district. Some of them are already contemplating expansion. In addition to the variety of businesses already opened, there are eight additional storefronts currently under development with specific is announcements of tenants coming in 2010. As outlined in the City’s master plan, downtown Steubenville is beginning to take shape as a lifestyle center. A lifestyle center is a pedestrian-friendly center where citizens will now have the opportunity to work, shop in unique stores, dine at quaint eateries, take in entertainment and cultural events and live downtown again in trendy, loft apartments. This is not some theoretical plan for some future time, but is representative of what is currently occurring throughout the downtown area. Unlike many cities, historic Steubenville is very fortunate to have retained a significant infrastructure of grand, historic buildings which many cities can only dream of having available for redevelopment. It is important to note that all of this is happening through private development and investment, not through government funding.

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is Local Economy: Economic Development

Progress Alliance, an economic development partnership between Jefferson County, the City of Steubenville and the Jefferson County Chamber of Commerce, makes it easy for businesses to locate and expand in the Steubenville-Jefferson County Area.

A public-private partnership, Progress Alliance was established in 1996 to spark and coordinate economic development activity in Jefferson County, iOs hio. It is a program of the Community Improvement Corporation of the Steubenville, Ohio, Area, a 501 c(6) non-profit development organization founded in 1963.

The business community in Jefferson County has been a big supporter of these efforts. Private donors have contributed more than one million to support Progress Alliance and economic development in Jefferson County.

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is Local Economy: Economic Development Continued

Some of Progress Alliance’s current projects include:

Plans are progressing on the Save The Grand project. The Grand Theatre in downtown Steubenville will become a functioning center for music and arts.

Nelson Fine Arts and Gifts, which purchased the former Lincoln School building in 2009, has created 10 new jobs and expects its expansion to continue.

Capital Recovery System, which works with courts around the state and country to collect delinquent fines just recently added 15 additional employees to its ranks. The comispany now has more than 40 people working in its downtown location.

Progress Alliance is working with a Northeast interested in opening a new grocery store in downtown Steubenville.

Construction continues on a new Walgreen’s store.

Plans are advancing for a new CVS Store.

It also should be noted that several sites within the City have been targeted for cleanup through a $1 million EPA grant aimed to turn brownfields into “greenfields”

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is Financial Position: General Fund G.A.A.P. History

GENERAL FUND G.A.A.P. 2007 2008 2009 Beginning Balance $ 934,784 $ 1,310,921 $ 203,028 Fortunately, the City has been able to weather its Revenues 2007 2008 2009 economic downturn with Income Taxes $ 7,834,852 $ 7,654,593 $ 7,783,318 Property & Other Taxes $ 1,320,875 $ 1,193,514 $ 1,146,976 its historically Intergovernmental $ 3,030,950 $ 2,063,036 $ 1,909,192 comfortable General Fund Charges for Services $ 113,196 $ 107,288 $ 99,086 Licenses and Permits $ 498,424 $ 574,004 $ 456,842 balances. Investment Income $ 235,602 $ 148,934 $ 87,574 Fines and Forfeitures $ 344,299 $ 326,745 $ 343,711 Rental Income $ 86,991 $ 102,971 $ 88,750 Other (Including Transfers In) $ 156,521 $ 91,191 $ 168,981 Although the structural Total Revenues $ 13,621,710 $ 12,262,276 $ 12,084,430 imbalance persisted in Expenditures 2007 2008 2009 2009, the City was able to General Government $ 2,970,717 $ 2,607,017 i$s 2,605,297 Security of Persons and Property $ 7,714,091 $ 7,854,420 $ 7,580,391 reduce its magnitude with Public Health and W elfare $ 490,409 $ 549,003 $ 567,418 timely budget cuts. Community Environment $ 62,828 $ 60,617 $ 95,009 Leisure Time Activity $ 781,700 $ 904,076 $ 704,556 Capital Outlay $ 24,406 $ - $ - Transportation $ 1,091,139 $ 1,236,673 $ 1,105,207 Debt Service $ 110,283 $ 158,363 $ 149,377 While the City’s 2009 Other (Including Transfers Out) $ - $ - $ - G.A.A.P balance was Total Expenditures $ 13,245,573 $ 13,370,169 $ 12,807,255 negative, the cash Excess of Revenues & Other Financing Sources Over (Under) Expenditures and Other Financing balance was over Uses $ 376,137 $ (1,107,893) $ (722,825) $265,000.

Fund Balances (deficit) at Beginning of Year $ 934,784 $ 1,310,921 $ 203,028 Fund Balances (deficit) at End of Year $ 1,310,921 $ 203,028 $ (519,797) Balance as a Percent of Revenues 9.62% 1.66% -4.30%

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is Financial Position: Historical General Fund Operations

2010 Projected Shortfall as of March 2009 $1,806,441.00 Non-Union Union Concessions 3.5% Pay Rate Concession $64,681.80 City Manager- Secretary $40,744.14 For the years 2008 and 2009, an operating deficit in M&R-Street Supt Replacement $49,783.61 Building-Building Inspector $16,316.27 the General Fund required the use of prior years $171,525.82 $ 1 ,634,915.18 surpluses. Health Department Transfers $47,544.00 Municipal Court Grant $45,023.00 $1,542,348.08 Fire Union Concessions 3.5% Pay Rate Concession $ 105,900.82 $105,900.82 In March 2009, the 2010 projected operating deficit for Uniform Allowance $ 19,550.00 $19,550.00 (3) Employee-Layoff $ 184,486.32 $184,486.32 the General Fund was $1,806,441. $309,937.14 $ 1 ,232,410.94 Police Union Concessions 3.5% Pay Rate Concession ($111,637.61) After exploring all avenues and options for cost savings, the Uniform Allowance ($23,520.00) following measures were implemented: (6) Employee-Layoff $303,938.34 Part-Time Parking Attendants $29,335.85 Stimulus Funds $140,000.00 * The City offered an Early Retirement/Resignation Inventive Plan $473,274.19 $ 7 59,136.75 is Retirement Incentive to reduce workforce Dispatch-Replace with Police Officer $3,424.87 Finance-Account Clerk II $44,981.39 * Fire Union concessions $48,406.26 $ 7 10,730.49 * Non-Union pay decrease of 3.5% AFSCME Union Concessions 3.5% Pay Rate Concession ($71,368.22) * Layoffs in Police and Fire Police-Matron/Clerk Typist $41,675.46 Police-Clerk Typist I $43,547.82 * The City also received stimulus money in the total amount of $433,790 Police-Clerk Typist II $41,534.74 for retaining three police officers; $144,596 of the grant was received Building-Secretary -$3,781.26 Building-Custodian $43,366.26 in 2010 Building-Maintenance Repair $47,284.14 * The City’s Financial Policy was amended to utilize interest earned for M&R-Maint Worker II CDL $44,371.91 M&R-Maint Worker II CDL $44,371.91 the General Fund. M&R-Maint Worker II CDL $44,371.91 M&R-Heavy Equipment Operator $48,413.60 Recreation-Secretary $44,249.65 Recreation-Maint Worker I $44,371.91 Recreation-Foreman $50,660.53 $534,438.58 $ 1 76,291.91

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is Financial Position: Historical General Fund Operations

As 2010 stands now, the operating deficit predicted early in 2009 has been reduced to just over $120,000. Possible factors that may increase that projected balance are:

* Increase in Income Tax Collections due to participating in the Subpoena Program with R.I.T.A. for non filers. The program generated a liability of $86,068.21 and during just that week, $7,923.00 was collected.

* A final settlement from Estate Taxes has not been received and cannot be estimated by the state or county at this time. Currently, while the revenue budget is prepared conservatively, tihsere are no additional funds budgeted for this revenue if it were to be received by the City.

* Continual collaboration between departments to recognize cost savings and operate more efficiently.

is Financial Position: 2011 Budget

With the change in administration and steering clear of old strategies, the new approach is to address issues and possible savings or revenue sources “before” budget issues arise.

Budget Revenue Enhancements: * Continually evaluate department needs versus wants. * Receive stimulus money of $7,829,671.15 for Washington Street Rehab Project. * Receive stimulus money of $579,510.02 for Traffic Signal and Street Lighting. Project will replace all old style bulbs with energy efficient LED bulbs. * Receive a federal grant for the Sunset Resurfacing Project of$1,379,456.95. * Receive a federal grant for the Sunset Boulevard Traffic Signal Improvement of $532,437.00. is Budget Savings: * Reorganization of the Finance and Utility Office. * Conversion of two-way radio equipment to cellular telephones. * 33% savings in office supplies through a contract with a local vendor. * Building maintenance decreases with the construction of the new city building. * All service contracts will be reviewed for possible savings. * Departments operating procedures and practices will be re-evaluated to ensure they are operating in the most efficient and cost effective manner.

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is Steubenville 2010-2020: A Vision for Our Future

The City’s Council passed a 10-Year Plan on October 12, 2010. This Plan will guide the City through the next decade and address eight main social, economic and financial goals.

Goal #1: Develop and implement a long-term infrastructure (water and sewer) replacement plan in order to revitalize and accommodate the current and future needs of the Community

Goal #2: Provide an environment that is safe, efficient, and cost effective in which our employees to work

Goal #3: Strengthen and diversify the economy tihsrough collaboration and planning

Goal #4: Create efforts to promote “Clean-up Our Community” (litter, blighted structures, sidewalks, grass, roadways)

Goal #5: Create a well trained and diverse workforce

Goal #6: Create an ability to respond to emergencies on a local and regional basis

Goal #7: Create a community environment that is safe and healthy

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is Steubenville 2010-2020: Fiscal Responsibility

Goal #8: Create an atmosphere of fiscal and regulatory responsibility

Continue to provide the public with financial updates and budgets through all means of technology (website and e-mail) in order to provide transparency

Pursue insurance claims for accidents the fire department has responded

Create a fund balance policy that will prepare the city for its future needs by creating a “savings account”

Create a capital improvement fund policy that sets funds aside in the expenditure budgets for future equipment and facility needs is

Explore federal, state and foundation grant opportunities while talking into account the administrative and grant requirements prior to submitting the grant

Create a budget process that will provide a system of budget workshops to inform council of Department needs

Implement a balanced budget approach that does not utilize left over funds from previous years in order to balance the budget

Investigate the refinancing of debt

Be more aggressive with the collection of income taxes and utility bills

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is Steubenville, Ohio: Credit Highlights

The City benefits, both economically and financially, from its Tri-State location and its proximity to Pittsburgh. Through a concerted effort by the City, the County and local businesses, the community continues to re-invent and strengthen its local economy. The City’s largest employers are no longer associated with the heavily cyclical manufacturing sector. Rather, its top employers are in the healthcare, government and higher education sectors. As with most cities, Steubenville has seen a recent decrease in its income tax collections and, subsequently, a decline in its General Fund reserve. Thati sbeing said, through budget cuts and policy changes the City has lessened its operating deficit from almost $1 million in 2008 to just over $120,000 in 2010. With the recent passage of its Strategic Plan, the City expects to begin implementing its many financial goals beginning in 2011. The most important of these goals in the establishment of a minimum General Fund balance. The City’s debt levels remain low.

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