10134-11 Waterworks Revenue Bonds $8,300,000

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the Council on June 23, 1997 (the "1997 Ordinance"), now outstanding in the amount of $2,140,000. The Council finds that on or about May 28, 2002, the Council adopted Ordinance No. 9328-02 (the "2002 Supplemental Ordinance"), which supplemented and amended the 2002 Ordinance, the 2000 Ordinance and the 1997 Ordinance to permit the City to substitute an insurance policy to provide funds for the Debt Service Reserve Account thereby freeing monies currently held in the Debt Service Reserve Account for use by and improvement of the waterworks. The 2002 Supplemental Ordinance, together with the 2009 Ordinance, the 2005 Ordinance, the 2002 Ordinance, the 2000 Ordinance and the 1997 Ordinance are sometimes collectively referred to herein as the "Prior Ordinances". The Council now finds that pursuant to the 2002 Supplemental Ordinance, the City entered into an Insurance Agreement with Financial Security Assurance Inc. ("FSA"), dated June 27, 2002 (the "FSA Insurance Agreement"), and pursuant to the FSA Insurance Agreement, FSA issued its Municipal Bond Debt Service Reserve Insurance Policy No. 29146-R, effective June 27, 2002 (the"2002 Reserve Insurance Policy"). The 2002 Reserve Insurance Policy covers principal and interest payments on the 1997 Bonds, 2000 Bonds and 2002 Bonds, up to the policy limit stated in the 2002 Reserve Insurance Policy. The initial policy limit of the 2002 Reserve Insurance Policy was set at$2,332,703. The Council now finds that pursuant to the 2005 Ordinance, the City entered into an Insurance Agreement with MBIA Insurance Corporation ("MBIA"), dated June 6, 2006 (the "MBIA Insurance Agreement"), and pursuant to the MBIA Insurance Agreement, MBIA issued its Debt Service Reserve Surety Bond No. 48026(2), effective June 6, 2006 (the "2006 Reserve Insurance Policy"). The 2006 Reserve Insurance Policy covers principal and interest payments on the 2006 Bonds, up to the policy limit stated in the 2006 Reserve Insurance Policy. The initial policy limit of the 2006 Reserve Insurance Policy was set at$365,826. The Prior Bonds constitute a first chaxge upon the Net Revenues (as hereinafter defined). The Prior Ordinances provide that the City may authorize and issue additional bonds payable out of the Net Revenues ranking on parity with the Parity Bonds (as hereinafter defined) for the purpose of financing the cost of future additions, extensions and improvements to the works subject to the provisions of the Prior Ordinances. The conditions precedent to the issuance of additional parity bonds set forth in the Prior Ordinances, as described above, have been satisfied, subject to approval by the State of Indiana(the"State"). The City desires to authorize the issuance of a bond anticipation note or notes hereunder, if necessary, payable from the proceeds of the revenue bonds authorized herein (the "BANs"), and to authorize the refunding of said BANs, if issued. The Council now finds that all conditions precedent to the adoption of an ordinance authorizing the issuance of revenue bonds and BANs have been complied with in accordance with the applicable provisions of the Act. - 3 -