Chandler ETRO Refunding-Series 2021-Preliminary Official Statement-draft
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PRELIMINARY OFFICIAL STATEMENT DATED NOVEMBER __, 2021
NEW ISSUE – BOOK-ENTRY-ONLY
RATINGS:
Fitch:
“___”
Moody’s: “___”
S&P:
“___”
See “RATINGS” herein
In the opinion of Gust Rosenfeld P.L.C., Phoenix, Arizona, Special Counsel, under existing laws, regulations, rulings and judicial decisions, and
assuming continuing compliance with certain restrictions, conditions and requirements by the City as mentioned under “TAX MATTERS” herein,
interest income on the portion of each Payment and Prepayment, if any, made by the City pursuant to the Agreement and denominated as and
comprising interest income pursuant to the Agreement and received by the Owners of the Series 2021 Refunding Obligations is not excluded from
gross income for federal income tax purposes. In the opinion of Special Counsel, interest income on the portion of each Payment and Prepayment,
if any, made by the City under the Agreement and denominated as and comprising interest income pursuant to the Agreement and received by the
Owners of the Series 2021 Refunding Obligations is exempt from Arizona income taxes. See “TAX MATTERS” herein.
$95,265,000*
CITY OF CHANDLER, ARIZONA
EXCISE TAX REVENUE REFUNDING OBLIGATIONS,
TAXABLE SERIES 2021
Dated: Date of Initial Delivery
Due: July 1, as shown on the inside front cover
The City of Chandler, Arizona (the “City”) will issue its $95,265,000* aggregate principal amount of Excise Tax Revenue Refunding Obligations,
Taxable Series 2021 (the “Series 2021 Refunding Obligations”) for the purpose of (i) providing funds for the purpose of refunding and redeeming,
in advance of their respective maturities, The Obligations Being Refunded (as defined herein) and (ii) paying the costs of issuance of the Series
2021 Refunding Obligations.
Interest on the Series 2021 Refunding Obligations will accrue from the date of initial delivery thereof and be payable semiannually on each January
1 and July 1, commencing January 1, 2022 (each an “Interest Payment Date”). The Series 2021 Refunding Obligations will be dated the date of
initial delivery and will be issuable as fully registered securities without coupons and will be initially registered in the name of Cede & Co., as
nominee of The Depository Trust Company (“DTC”), New York, New York, which will act as securities depository for the Series 2021 Refunding
Obligations. Beneficial interests in the Series 2021 Refunding Obligations will be available to purchasers in amounts of $5,000 of principal due
on a single maturity date and any integral multiple thereof only under the book-entry-only system maintained by DTC through brokers and dealers
who are, or act through, DTC Participants. Purchasers will not receive physical certificates. So long as any purchaser is the beneficial owner of
an Obligation, such purchaser must maintain an account with a broker or a dealer who is, or acts through, a DTC Participant to receive payment of
principal and interest on such Obligations. See APPENDIX F – “BOOK-ENTRY-ONLY SYSTEM.”
The Series 2021 Refunding Obligations are subject to optional redemption prior to maturity as described under “THE SERIES 2021 REFUNDING
OBLIGATIONS – Redemption Provisions” herein*.
The Series 2021 Refunding Obligations will be payable from payments (“Payments”) or prepayments, if any, (the “Prepayments”) to be made by the
City pursuant to an Agreement, dated as of _______ 1, 2021*, between the City and U.S. Bank National Association, as Trustee (the “Trustee”). The
Payments and Prepayments, if any, to be made by the City will be secured by a pledge of, and lien on, the City’s Excise Taxes (as defined herein).
Except to the extent herein, such pledge is and will be on a parity with the City’s pledge of such Excise Taxes made in connection with the Existing
Parity Obligations and any Additional Parity Obligations executed and delivered on a parity (together, the “Parity Obligations”). See “SECURITY
AND SOURCES OF PAYMENT” herein.
THE SERIES 2021 REFUNDING OBLIGATIONS WILL BE SPECIAL REVENUE OBLIGATIONS OF THE CITY AND WILL BE PAYABLE
SOLELY FROM THE SOURCES DESCRIBED HEREIN. THE SERIES 2021 REFUNDING OBLIGATIONS WILL NOT BE GENERAL
OBLIGATIONS OF THE CITY, THE STATE OF ARIZONA OR ANY POLITICAL SUBDIVISION THEREOF AND THE FULL FAITH AND
CREDIT OF THE CITY, THE STATE OF ARIZONA OR ANY POLITICAL SUBDIVISION THEREOF WILL NOT BE PLEDGED FOR THE
PAYMENT OF THE SERIES 2021 REFUNDING OBLIGATIONS.
See Maturity Schedule on Inside Front Cover Page
The Series 2021 Refunding Obligations are offered when, as and if executed and delivered and accepted by the Underwriter(s) subject to the
approving legal opinion of Gust Rosenfeld P.L.C., Phoenix, Arizona, Special Counsel, as to validity and tax matters. Certain legal matters will
be passed upon solely for the benefit of the Underwriters by their counsel _____________, Phoenix, Arizona. It is expected that the Series
2021 Refunding Obligations, in book-entry-only form, will be available for delivery through the facilities of DTC on or about November __, 2021*.
This cover page contains certain information for quick reference only. It is not a summary of this issue of which the Series 2021 Refunding
Obligations are a part. Investors must read the entire Official Statement to obtain information essential to the making of an informed investment
decision with respect to the Series 2021 Refunding Obligations.
UNDERWRITER(S) TBD
* Preliminary, subject to change.
$95,265,000*
CITY OF CHANDLER, ARIZONA
EXCISE TAX REVENUE REFUNDING OBLIGATIONS
TAXABLE SERIES 2021
MATURITY SCHEDULE*
Maturity
Date
(July 1)
Principal
Amount
Interest
Rate
Price or
Yield
CUSIP® No.
158855(a)
2022
$2,860,000
%
%
2023
1,425,000
2024
5,935,000
2025
5,950,000
2026
6,070,000
2027
5,890,000
2028
8,660,000
2029
11,940,000
2030
11,660,000
2031
11,895,000
2032
11,620,000
2033
11,360,000
______________________________
(a) CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (“CGS”) is managed on behalf
of the American Bankers Association by S&P Global Market Intelligence. Copyright© 2021 CGS. All rights reserved. CUSIP®
data herein is provided by CGS. This data is not intended to create a database and does not serve in any way as a substitute for
the CGS database. CUSIP® numbers are provided for convenience of reference only. None of the City, Special Counsel, the
Underwriters, the Financial Advisor (each as defined herein) or their agents or counsel assume responsibility for the accuracy
of such numbers.
* Preliminary, subject to change.
i
CITY OF CHANDLER, ARIZONA
CITY COUNCIL
Kevin Hartke, Mayor
Mark Stewart, Vice Mayor
Christine Ellis, Councilmember
OD Harris, Councilmember
René Lopez, Councilmember
Matt Orlando, Councilmember
Terry Roe, Councilmember
CITY ADMINISTRATIVE OFFICERS
Joshua Wright, City Manager
Debra Stapleton, Assistant City Manager
Dawn Lang, Management Services Director
Kelly Schwab, City Attorney/Risk Manager
Dana DeLong, City Clerk
SPECIAL COUNSEL
Gust Rosenfeld P.L.C.
Phoenix, Arizona
FINANCIAL ADVISOR
Piper Sandler & Co.
Phoenix, Arizona
TRUSTEE/DEPOSITORY TRUSTEE, REGISTRAR AND PAYING AGENT
U.S. Bank National Association
Phoenix, Arizona
ii
REGARDING THIS OFFICIAL STATEMENT
This Official Statement, which includes the cover page, the inside front cover page and the appendices hereto, does not constitute an
offering of any security other than the City of Chandler, Arizona (the “City”) Excise Tax Revenue Series 2021 Refunding Obligations,
Taxable Series 2021 (the “Series 2021 Refunding Obligations”), identified on the inside front cover page hereof. No person has been
authorized by the City, to give any information or to make any representations other than as contained in this Official Statement, and
if given or made, such other information or representation not so authorized should not be relied upon as having been given or made
by the MPC or the City. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, and there
shall be no sale of the Series 2021 Refunding Obligations by any person in any jurisdiction in which it is unlawful to make such offer,
solicitation or sale.
The information set forth in this Official Statement has been provided by the City, Maricopa County, the State of Arizona Dep artment
of Revenue and other sources which are considered to be reliable and customarily relied upon in the preparation of similar official
statements, but such information is not guaranteed as to accuracy or completeness and is not to be construed as the promise or
guarantee of the City or Piper Sandler & Co. (the “Financial Advisor”) or ____________________ (collectively, the “Underwriters”).
The presentation of information, including tables of receipts from taxes and other sources, is intended to show recent historical
information and is not intended to indicate future or continuing trends in the financial position or other affairs of the City. No person,
including any broker, dealer or salesman has been authorized to give any information or to make any representations other than those
contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as
having been authorized by the City. All estimates and assumptions contained herein have been based on the latest information
available and are believed to be reliable, but no representations are made that such estimates and assumptions are correct, will be
realized or will be repeated in the future. The information and any expressions of opinion contained herein are subject to 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 or any other parties or matters described herein since the date
thereof.
The issuance and sale of the Series 2021 Refunding Obligations will not be registered under the Securities Act of 1933, as amended,
the Securities Exchange Act of 1934, as amended, or the Arizona Securities Act in reliance upon exemptions provided under such
acts for the issuance and sale of securities such as the Series 2021 Refunding Obligations. The Series 2021 Refunding Obligations
will not be listed on any stock or other securities exchange. Neither the Securities and Exchange Commission nor any other federal,
State or other government entity or agency will have passed upon the merits of the Series 2021 Refunding Obligations or the accuracy
or adequacy of this Official Statement or approved the Series 2021 Refunding Obligations for sale.
The City has undertaken to provide continuing disclosure with respect to the Series 2021 Refunding Obligations as required by Rule
15c2-12 of the Securities and Exchange Commission. See “CONTINUING SECONDARY MARKET DISCLOSURE” and
APPENDIX G – “FORM OF CONTINUING DISCLOSURE CERTIFICATE” herein.
None of the City, the Underwriters, the Financial Advisor, counsel to the Underwriters and Special Counsel (as defined herein) are
actuaries, nor have any of them performed any actuarial or other analysis of the City's unfunded liabilities under the Arizona State
Retirement System, the Arizona Public Safety Personnel Retirement System or the Elected Officials Retirement Plan.
The Underwriters have provided the following sentence for inclusion into this Official Statement: The Underwriters have reviewed
the information in this Official Statement in accordance with, and as part of, their responsibilities to investors under federal securities
laws as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the accuracy or completeness
of such information.
In connection with this offering, the Underwriters may allow concessions or discounts from the initial public offering prices to dealers
and others, and the Underwriters may over allot or engage in transactions intended to stabilize the prices of the Series 2021 Refunding
Obligations at levels above those which might otherwise prevail in the open market in order to facilitate their distribution. Such
stabilization, if commenced, may be discontinued at any time.
The information in APPENDIX F – “BOOK-ENTRY-ONLY SYSTEM” has been furnished by The Depository Trust Company, and
no representation has been made by the City, the Underwriter’s, the Financial Advisor or any of their counsel or agents, as to the
accuracy or completeness of such information.
A wide variety of information, including financial information, concerning the City is available from publications and websites of
the City and others. Any such information that is inconsistent with the information set forth in this Official Statement should be
disregarded. No such information is a part of, or incorporated into, this Official Statement, except as expressly noted herein.
iii
TABLE OF CONTENTS
Page
INTRODUCTORY STATEMENT ...............................................................................................................................................1
THE SERIES 2021 REFUNDING OBLIGATIONS .................................................................................................................1
General Provisions........................................................................................................................................................................1
Redemption Provisions ................................................................................................................................................................2
Notice of Redemption ..................................................................................................................................................................2
Registration, Transfer and Exchange ........................................................................................................................................3
SECURITY AND SOURCES OF PAYMENT...........................................................................................................................4
General............................................................................................................................................................................................4
Covenant to Maintain Debt Service Coverage.........................................................................................................................4
Additional Parity Obligations .....................................................................................................................................................5
Reserve Fund; Funding Conditional..........................................................................................................................................5
Junior Lien Obligations ...............................................................................................................................................................5
COVID-19..........................................................................................................................................................................................6
Excise Taxes ......................................................................................................................................................................................7
PLAN OF REFUNDING ..............................................................................................................................................................11
OBLIGATIONS TO BE REFUNDED* .....................................................................................................................................12
VERIFICATION OF MATHEMATICAL COMPUTATIONS.............................................................................................12
SOURCES AND USES OF FUNDS ..........................................................................................................................................13
SCHEDULE OF ESTIMATED DEBT SERVICE COVERAGE ON OBLIGATIONS AND PARITY
OBLIGATIONS (a)........................................................................................................................................................................14
TAX MATTERS.............................................................................................................................................................................15
Original Issue Discount .............................................................................................................................................................15
Obligations Purchased at a Premium.......................................................................................................................................16
Disposition of Obligations ........................................................................................................................................................16
Defeasance ...................................................................................................................................................................................16
Information Reporting and Backup Withholding..................................................................................................................16
Non-U.S. Owners........................................................................................................................................................................16
Circular 230 .................................................................................................................................................................................17
LEGAL MATTERS .......................................................................................................................................................................17
LITIGATION ..................................................................................................................................................................................17
CANCELLATION OF CONTRACTS .......................................................................................................................................17
FINANCIAL STATEMENTS......................................................................................................................................................18
CONTINUING SECONDARY MARKET DISCLOSURE ...................................................................................................18
RATINGS ........................................................................................................................................................................................18
UNDERWRITING .........................................................................................................................................................................19
POLITICAL DONATIONS..........................................................................................................................................................19
CERTIFICATION CONCERNING OFFICIAL STATEMENT ...........................................................................................19
ADDITIONAL INFORMATION................................................................................................................................................19
CONCLUDING STATEMENT...................................................................................................................................................20
APPENDIX A - CITY OF CHANDLER, ARIZONA — GENERAL ECONOMIC AND DEMOGRAPHIC
INFORMATION
APPENDIX B - CITY OF CHANDLER, ARIZONA — FINANCIAL DATA
APPENDIX C - FORM OF OPINION OF SPECIAL COUNSEL
APPENDIX D - SUMMARIES OF SELECT PROVISIONS OF PRINCIPAL DOCUMENTS
APPENDIX E - CITY OF CHANDLER, ARIZONA — AUDITED FINANCIAL STATEMENTS OF THE CITY OF
CHANDLER, ARIZONA FOR THE FISCAL YEAR ENDED JUNE 30, 2020
APPENDIX F - BOOK-ENTRY-ONLY SYSTEM
APPENDIX G - FORM OF CONTINUING DISCLOSURE CERTIFICATE
1
OFFICIAL STATEMENT
$95,265,000*
CITY OF CHANDLER, ARIZONA
EXCISE TAX REVENUE OBLIGATIONS,
TAXABLE SERIES 2021
INTRODUCTORY STATEMENT
This Official Statement, which includes the cover page, the inside front cover page and the appendices hereto (the
“Official Statement”), provides certain information concerning the Excise Tax Revenue Refunding Obligations, Taxable
Series 2021 (the “Series 2021 Refunding Obligations”), to be executed and delivered in the aggregate principal amount
of $95,265,000.* The Series 2021 Refunding Obligations are being issued pursuant to a Trust Agreement, dated as of
______ 1, 2021* (the “Trust Agreement”), by and between the City and_____________, as trustee (the “Trustee”). The
Series 2021 Refunding Obligations are payable solely from payments (the “Payments”) or prepayments, if any (the
“Prepayments”), to be made by the City of Chandler, Arizona, (the “City”) pursuant to an Agreement, dated as of
____________ 1, 2021 (the “Agreement”), between the City and Trustee. All of the Trustee’s interest under the
Agreement, including, without limitation, the right to receive and collect the Payments and Prepayments, if any, and the
amounts payable under the Trust Agreement and the right to enforce the payment of Payments and Prepayments, if any,
will be held by the Trustee for the benefit of the registered owners of the Series 2021 Refunding Obligations. See
APPENDIX D – “SUMMARIES OF SELECT PROVISIONS OF PRINCIPAL DOCUMENTS” herein.
Concurrently with the issuance of the Series 2021 Refunding Obligations, the City expects to offer its $_________*
General Obligation Refunding Bonds, Taxable Series 2021 (the “Series 2021 GO Refunding Bonds”), pursuant to
separate official statements. The Series 2021 Excise Tax Refunding Obligations will not be secured by, or payable from,
ad valorem taxes. See “STATEMENTS OF BONDS OUTSTANDING Excise Tax Revenue Obligations Outstanding
and to be Outstanding” in APPENDIX B – “CITY OF CHANDLER, ARIZONA – Financial Data”. In addition to the
bonds, the City expects to offer its $__________* General Obligation Bonds, Series 2021 (the “Series 2021 GO Bonds”)
pursuant to separate official statements.
A brief description of the security for the Series 2021 Refunding Obligations and of the City are included in this Official
Statement together with a summary of select provisions of the Agreement and the Trust Agreement. Such descriptions
do not purport to be comprehensive or definitive. All references to the Agreement and the Trust Agreement are qualified
in their entirety by reference to such documents, and references herein to the Series 2021 Refunding Obligations are
qualified in their entirety by reference to the form thereof included in the Trust Agreement, copies of which are available
for inspection at the designated corporate trust office of the Trustee.
THE SERIES 2021 REFUNDING OBLIGATIONS
General Provisions
The Trustee is authorized to prepare, execute and deliver the Series 2021 Refunding Obligations in the aggregate
principal amount of $95,265,000* evidencing proportionate ownership interest in the Payments and Prepayments, if
any, in accordance with Resolution No. ____ adopted by the Mayor and Council of the City on August 26, 2021 (the
“Resolution”).
The Series 2021 Refunding Obligations are being issued to provide funds for the purpose of (i) refunding and redeeming,
in advance of their respective maturities, certain of the City’s outstanding excise tax revenue bonded indebtedness in
aggregate principal amount of $87,055,000* (the “Obligations Being Refunded”) and (ii) for paying costs related to the
issuance of the Series 2021 Refunding Obligations. The Series 2021 Refunding Obligations will be payable from the
Payments and Prepayments, if any, made by the City to the Trustee pursuant to the Agreement. See “PLAN OF
REFUNDING” herein.
* Preliminary, subject to change.
2
The Series 2021 Refunding Obligations are available only in fully registered certificated form. The Series 2021
Refunding Obligations will bear interest, at the rates and will mature on the dates and in the amounts, all as set forth on
the inside front cover page hereof.
The Series 2021 Refunding Obligations initially will be registered in the name of Cede & Co., as registered Owner and
nominee of The Depository Trust Company (“DTC”), New York, New York. So long as DTC, or its nominee, Cede &
Co., is registered Owner of all of the Series 2021 Refunding Obligations, all payments on the Series 2021 Refunding
Obligations will be made directly to DTC in immediately available funds, by wire transfer on or before the date due.
So long as Cede & Co., is the registered Owner of the Series 2021 Refunding Obligations, as nominee for DTC, references
herein to “Owners” or registered owners of the Series 2021 Refunding Obligations shall mean Cede & Co., as aforesaid,
and shall not mean the actual purchasers of beneficial interest in the Series 2021 Refunding Obligations (the “Beneficial
Owners”). When reference is made to any action which is required or permitted to be taken by the Beneficial Owners,
such reference shall only relate to those permitted to act (by statute, regulation or otherwise) on behalf of such Beneficial
Owners for such purposes. When notices are given, they shall be sent by the City or the Trustee to DTC only, as registered
Owner. See APPENDIX F – “BOOK-ENTRY-ONLY SYSTEM”.
The Series 2021 Refunding Obligations initially will be dated their date of initial delivery. Interest on the Series 2021
Refunding Obligations will be payable on each January 1 and July 1 (each such date is referred to herein as an “Interest
Payment Date”), commencing January 1, 2022*, and will accrue from their dated date.
Redemption Provisions*- [To be discussed]
[Make Whole Optional Redemption of the Series 2021 Refunding Obligations. The Series 2021 Refunding Obligations
are subject to redemption prior to their stated maturity dates, at the option of the City, in whole or in part, on any date,
at a redemption price equal to the greater of (i) the principal amount of such Series 2021 Refunding Obligations to be
redeemed; or (ii) the sum of the present value of the remaining scheduled payments of principal and interest to the
maturity date of Series 2021 Refunding Obligations to be redeemed, not including any portion of those payments of
interest accrued and unpaid as of the date on which such Series 2021 Refunding Obligations are to be redeemed,
discounted to the date on which such Series 2021 Refunding Obligations are to be redeemed on a semi-annual basis,
assuming a 360-day year consisting of twelve 30-day months, at the Treasury Rate (as defined below) plus __ basis
points; plus accrued interest on such Series 2021 Refunding Obligations to be redeemed to the redemption date.
“Treasury Rate” means as of the redemption date, the yield to maturity as of such prepayment date of United States
Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical
Release H. 15 (519) that has become publicly available at least two business days prior to the redemption date (excludin g
inflation indexed securities) (or, if such Statistical Release is no longer published, any publicly available source of
similar market data)) most nearly equal to the period from the redemption date to the maturity of the Series 2021
Refunding Obligations to be redeemed; provided, however, that if the period from the redemption date to maturity is
less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant
maturity of one year will be used.
Any redemption price of the Series 2021 Refunding Obligations to be redeemed pursuant to the provisions described
above will be determined by an independent accounting firm, investment banking firm, or financial advisor retained by
the MPC and the City to calculate such redemption price. The MPC and the City may conclusively rely on the
determination of such redemption price by such independent accounting firm, investment banking firm or financial
advisor and will not be liable for such reliance.]
Notice of Redemption
The Trustee shall send notices of redemption to DTC in the manner required by DTC. If the Book-Entry-Only System
is discontinued, the Trustee shall mail notice of redemption of any Series 2021 Refunding Obligations to the registered
owner of the Series 2021 Refunding Obligation being redeemed at the address shown on the bond register maintained
by the Trustee not more than sixty (60) nor less than thirty (30) days prior to the date set for redemption. Notice of
* Preliminary, subject to change.
3
redemption may be sent to any securities depository by mail, facsimile transmission, wire transmission or any other
means of transmission of the notice generally accepted by the respective securities depository. Neither the failure of
DTC nor any registered owner of the Series 2021 Refunding Obligations to receive a notice of redemption nor any
defect therein will affect the validity of the proceedings for the redemption of the Series 2021 Refunding Obligations as
to which proper notice of redemption was given.
The Trustee also agrees to send notice of any redemption to the Municipal Securities Rulemaking Board (the “MSRB”),
currently through the MSRB’s Electronic Municipal Market Access system (“EMMA”), in the manner required by the
MSRB, but no defect in said further notice or record nor any failure to give all or a portion of such further notice shall
in any manner defeat the effectiveness of a call for redemption if notice thereof is given as prescribed above.
Notice of redemption having been given in the manner described above, the Series 2021 Refunding Obligations or
portions thereof called for redemption will become due and payable on the redemption date and if an amount of money
sufficient to redeem all the Series 2021 Refunding Obligations or portions thereof called for redemption is held by the
Trustee, then the Series 2021 Refunding Obligations or portions thereof called for redemption will cease to bear interest
from and after such redemption date.
The person in whose name any Series 2021 Refunding Obligation is registered will be deemed and regarded as the
absolute owner thereof for all purposes, and payment of the principal of and interest on any Series 2021 Refunding
Obligation will be made only to or upon the order of the registered owner thereof or the legal representative of the
registered owner. All such payments will be valid and effectual to satisfy and discharge the liability of the City upon
such Series 2021 Refunding Obligation to the extent of the sum or sums so paid.
Registration, Transfer and Exchange
So long as any of the Series 2021 Refunding Obligations remain outstanding, the MPC will cause the Trustee to establish
and maintain a bond register at the designated corporate trust office of the Trustee for the registration and tran sfer of
the Series 2021 Refunding Obligations, as provided for in the Trust Agreement. Subject to certain provisions of the
Trust Agreement, the person in whose name a Series 2021 Refunding Obligation is registered on the bond register
maintained by the Trustee will be regarded as the absolute owner of that Series 2021 Refunding Obligation for all
purposes and neither the City nor the Trustee will be affected by any notice to the contrary, provided that the registration
may be changed as provided in the Trust Agreement.
Each Series 2021 Refunding Obligation will be transferable only upon the bond register by the registered owner thereof
in person or by an attorney duly authorized in writing, upon surrender thereof together with a written instrument of
transfer satisfactory to the Trustee and duly executed by the registered owner or his duly authorized attorney. For every
exchange or transfer of the Series 2021 Refunding Obligations, the City or the Trustee may make a charge sufficient to
reimburse it for any tax, fee, governmental charge or cost incurred in connection with such exchange or transfer.
Upon surrender for transfer of any Series 2021 Refunding Obligation at the designated corporate trust office of the
Trustee, duly endorsed by, or accompanied by a written instrument or instruments of transfer in form satisfactory to the
Trustee and duly executed by the registered owner or his attorney-in-fact duly authorized in writing, the Trustee will
authenticate, date and deliver in the name of the transferee or transferees, a new fully-registered Series 2021 Refunding
Obligation of the same series, maturity and interest rate and a like aggregate principal amount in authorized
denominations. Any Series 2021 Refunding Obligation may be exchanged at the designated corporate trust office of
the Trustee for a Series 2021 Refunding Obligations of the same series, maturity and interest rate and a like aggregate
principal amount in authorized denominations.
The Trustee will transfer any Series 2021 Refunding Obligations during the period beginning at the close of business
on each Record Date, to and including the day preceding the next Interest Payment Date, but the interest payment on
such Interest Payment Date will be payable to and mailed to the registered owner of such Series 2021 Refunding
Obligations on the Record Date. Notwithstanding the foregoing, the Trustee will not be required to transfer any Series
2021 Refunding Obligations after notice of redemption with respect to such Series 2021 Refunding Obligations has
been mailed, nor during the period of fifteen (15) days next preceding the mailing of any notice of redemption with
respect to any Series 2021 Refunding Obligations.
4
SECURITY AND SOURCES OF PAYMENT
General
The Series 2021 Refunding Obligations are special revenue obligations of the City, payable solely from Payments and
Prepayments, if any, to be paid by the City to the Trustee pursuant to the Agreement. The Trustee will hold its right,
title and interest in the Agreement, the Payments, Prepayments, if any, and any amounts payable under the Trust
Agreement in trust for the benefit of the Owners of the Series 2021 Refunding Obligations pursuant to the Trust
Agreement. The Series 2021 Refunding Obligations, the Agreement, Trust Agreement and the obligation to make the
Payments do not represent or constitute a general obligation of the City, the State of Arizona or any of its political
subdivisions.
Under the terms of the Trust Agreement, the Series 2021 Refunding Obligations are payable by the Trustee from and
secured by the Payments and Prepayments, if any, received by the Trustee from the City under the Agreement, amounts
from time to time deposited in the funds created under the Trust Agreement, and investment earnings on such funds
(except for any investment earnings that are required to be rebated to the United States in order to continue the exclusion
of the interest payable on the Series 2021 Refunding Obligations from gross income for federal income tax purposes).
See APPENDIX D – “SUMMARIES OF SELECT PROVISIONS OF PRINCIPAL DOCUMENTS.”
The Payments are secured by a pledge of the City’s Excise Taxes (as defined below) on a parity with the City’s pledge
of Excise Taxes for the payments pertaining to the Existing Parity Obligations and any Additional Parity Obligations
(as defined in the Trust Agreement) executed and delivered on a parity (together, the “Parity Obligations”). Currently,
the City has Parity Obligations outstanding in the aggregate principal amount of $1,775,000 comprised of the City’s
Excise Tax Revenue Obligations, Series 2011, currently outstanding in the aggregate principal amount of $94,300,000,
the City’s Excise Tax Revenue Obligations, Series 2013, currently outstanding in the aggregate principal amount of
$58,610,000, the City’s Excise Tax Revenue Obligations, Series 2015, currently outstanding in the aggregate principal
amount of $18,330,000, the City’s Excise Tax Revenue Refunding Obligations, Series 2016, currently outstanding in
the aggregate principal amount of $34,445,000, the City’s Excise Tax Revenue Obligations, Series 2017, currently
outstanding in the aggregate principal amount of $12,320,000 and the City’s Excise Tax Revenue Obligations, Series
2019, (collectively, the “Existing Parity Obligations”). The major categories of revenues which comprise the Excise
Taxes are discussed more fully below. See “EXCISE TAXES.”
The Payments to be paid by the City to the Trustee pursuant to the Agreement may be paid, at the option of the City,
from the Water and Wastewater Funds (as defined herein) or from any other lawful source. Such revenues are not
pledged to the Payments and, if commenced, such use of such revenues may be discontinued at any time by the City.
Payment of the Series 2021 Refunding Obligations is not secured by the Project, and the Owners of the Series 2021
Refunding Obligations have no claim or lien on the Project or any part thereof.
Covenant to Maintain Debt Service Coverage
The City covenants and agrees that the Excise Taxes which it presently imposes will continue to be imposed in each
Fiscal Year so that the amount of Excise Taxes, all within and for the next preceding Fiscal Year of the City, shall be
equal to at least three (3) times the Maximum Annual Debt Service Requirement (as defined in the Trust Agreement)
payable thereunder, and under any Outstanding Parity Obligations, for the current Obligation Year (as defined in the
Trust Agreement). The City further covenants and agrees that if such receipts for any such Fiscal Year shall not equal
at least three (3) times such Maximum Annual Debt Service Requirement for such Obligation Year, or if at any time it
appears that the current Fiscal Year’s receipts will not be sufficient to meet the current Obligation Year’s Maximum
Annual Debt Service Requirement, the City will either impose new Excise Taxes or will increase the rates of such taxes
currently imposed in order that (i) the current Fiscal Year’s receipts will be sufficient to meet the current Obligation
Year’s Maximum Annual Debt Service Requirement and (ii) the then current Fiscal Year’s receipts will be equal to at
least three (3) times the next succeeding Obligation Year’s Maximum Annual Debt Service Requirement. See
“SCHEDULE
OF
ESTIMATED
DEBT
SERVICE
COVERAGE
ON
OBLIGATIONS
AND
PARITY
OBLIGATIONS” herein.
5
Additional Parity Obligations
In the Trust Agreement, the City covenants and agrees that, so long as any of the Series 2021 Refunding Obligations
remain outstanding and the principal and interest thereon shall be unpaid or unprovided for or any other amounts remain
unpaid or unprovided for thereunder, it will not further encumber the Excise Taxes pledged under the Agreement on a
basis equal to the pledge thereunder unless the Excise Taxes received by the City in the immediately preceding fiscal
year shall have amounted to at least three (3) times the highest combined Debt Service (as defined herein) for the current
year or any succeeding fiscal year for all outstanding Parity Obligations. Subject to the foregoing and the other terms
and conditions of the Agreement, the City shall have the right to issue Additional Parity Obligations payable from and
secured by the Excise Taxes on parity with the Series 2021 Refunding Obligations.
“Debt Service” means with respect to any Parity Obligations, as of any date of calculation and with respect to any fiscal
year, the sum of (1) the interest falling due during such fiscal year (except to the extent that such interest is payable
from proceeds of the Parity Obligations or other amounts set aside for such purposes at the time such Parity Obligations
are incurred), and (2) the principal (or mandatory sinking fund or installment purchase price or lease rental or similarly
denoted principal payment obligation) payments or deposit required with respect to such Parity Obligations during such
period; such sum to be computed on the assumption that no portion of such Parity Obligations shall cease to be
outstanding during such fiscal year except by reason of the application of such scheduled payments. If interest on Parity
Obligations is payable pursuant to a variable interest rate formula, the interest rate on such Parity Obligations for fiscal
years when the actual interest rate on such Parity Obligations cannot yet be determined shall be assumed to be equal to
the higher of: (a) the average annual interest rate on such Parity Obligations over the last five fiscal years or since the
date of issuance of such Parity Obligations if less than five years, or (b) if the terms of such Parity Obligations provide
for conversion of the interest rate payable on such obligations to a fixed interest rate for the remainder of their term to
maturity, an interest rate per annum determined in accordance with the provisions of such obligations as if the interest
rate payable thereon were being converted to a fixed interest rate for the remainder of their term to maturity.
Reserve Fund; Funding Conditional
The Trust Agreement establishes a reserve fund (the “Reserve Fund”), to secure payment of the Series 2021 Refunding
Obligations, but provides that no deposits need to be made into the Reserve Fund for the Series 2021 Refunding
Obligations if the Excise Taxes pledged and received by or on behalf of the City in the immediately preceding fiscal
year are at least two (2) times the highest combined Debt Service requirement on all outstanding Parity Obligations for
the current or any future fiscal year. In the event that the Excise Taxes collected for the immediately preceding fiscal
year are less than two (2) times the highest combined Debt Service on all outstanding Parity Obligations for the current
or any future fiscal year, the City, in addition to the other Payments provided under the Agreement, is required to deposit
into the Reserve Fund, on the first day of each month commencing the first month after the Excise Taxes actually
received in such fiscal year are below the required amount, one-thirty-sixth (1/36th) of such highest combined annual
Debt Service in any fiscal year on the outstanding Parity Obligations (the “Reserve Fund Requirement”), except for any
Additional Parity Obligations for which a separate reserve fund is established or for which no reserve fund is required,
until the amount in the Reserve Fund equals the Reserve Fund Requirement.
In lieu of, or in combination with, funding, the City may deliver a Reserve Fund Guaranty (defined herein). “Reserve
Fund Guaranty” means a letter of credit, surety bond, or similar arrangement representing the irrevocable obligation of
a Reserve Fund guarantor to pay the amount stated in the Reserve Fund Guaranty. The Reserve Fund guarantor shall
be rated “AA” or higher by the rating agencies rating the Series 2021 Refunding Obligations.
Junior Lien Obligations
Under the Trust Agreement, the City may make pledge of and permit liens on the Excise Taxes which are subordinate
to the pledge and lien securing the Series 2021 Refunding Obligations. There are currently no junior lien obligations
outstanding.
6
COVID-19
The outbreak and spread of the novel strain of coronavirus, Coronavirus Disease 2019 (“COVID-19”), which has been
designated a global pandemic by the World Health Organization, is negatively affecting local, state and global
economies. While economic activity is adversely impacted as governments, businesses and citizens react to, plan for,
and try to prevent or slow further transmission of the virus, this adverse economic impact is somewhat mitigated by
federal stimulus packages and state and local laws and programs to support business activity. Financial markets,
including the stock markets in the United States and globally, have seen significant volatility and declines attributed to
COVID-19 concerns. On March 11, 2020, as part of the State’s response to address the outbreak, Arizona Governor,
Doug Ducey (the “Governor”), declared a state of emergency. On March 13, 2020, President Donald Trump declared
a national emergency, freeing up funding for federal assistance to state and local governments. An initial State of
Arizona stay home Executive Order expired after six weeks on May 15, 2020. The Governor has since issued several
executive orders in response to then-current virus conditions. These orders cover topics including physical distancing,
virus testing and reporting, contact tracing, face coverings, closing and reopening of business operation, large
gatherings, the start of the 2020/21 school year and vaccine distribution.
On June 29, 2020, the Governor issued Executive Order 2020-43 (Slowing the Spread of COVID-19) originally pausing
until July 27, 2020 the operations of bars, gyms, movie theatres, water parks, and tubing rentals (to be reviewed every
two weeks); and delaying the start of in-person K-12 education until August 17, 2020. After further increases in
COVID-19 cases and hospitalizations in the State, the Governor announced and issued on July 9, 2020 Executive Order
2020-47 (Limiting Indoor Dining), limiting indoor dining at restaurants to less than 50% occupancy. The order pausing
operations of the previously specified activities was extended on July 23, 2020. On August 6, for schools, and on August
10, for paused businesses, the Arizona Department of Health Services released benchmarks for achieving phased, safe
in-person reopenings. The benchmarks, with minimal, moderate and substantial condition categories, address, by
county for a two-week period, weekly average cases per 100,000 population; diagnostic test percent positivity; and
COVID-19-like-illness as a percent of hospital visits. On March 5, 2021, the Governor issued Executive Order 2021-
05 allowing specific business occupancy percentage limitations to expire while leaving physical distancing and mask
protocols in place. Additionally, Executive Order 2021-05 allows for Major League Sports to operate with approval of
safety precautions and physical distancing.
Most recently, on March 25, 2021, the Governor issued an order (“Executive Order 2021-06”) that rescinded all prior
limits on organized public events and capacity and spacing requirements at restaurants. Executive Order 2021-06 also
prohibits counties, cities and towns from making or issuing any order, rule or regulation that conflicts with Executive
Order 2021-06 or any other executive order relating to COVID-19, including any county, city or town mandate on the
use of face coverings.
Vaccine distribution is underway in the State. Executive Order 2020-58 requires all insurers regulated by the State to
waive all cost sharing requirements for consumers.
The City has already received approximately $33,300,000 in various grants to support operations related to COVID-19
and is actively looking for and will apply for additional grant awards as they may become available. Additionally, the
City has already received $29,983,456 through the State from the Coronavirus Aid, Relief and Economic Security Act
passed by the U.S. Congress and enacted into law in March 2020. The funding is designed to cover public safety
expenditures which freed up resources in the General Fund.
The fiscal year 2021-22 adopted budget used conservative revenue projections and expenditure levels that reflect the
return to a more normal revenue year as the impacts of expected revenue decreases related to COVID-19 did not come
to fruition in FY 2020-21. It is possible that the full financial impact of COVID-19 on the City, its economy, and its
financial position could change significantly as circumstances evolve. The City will continue to monitor events as they
occur, especially those that may have a significant impact on the City’s budget and finances and take appropriate action
where necessary.
While the City does not currently anticipate a material effect on the collection of property taxes, which is a significant
revenue source for operating purposes and which may be available, but is not pledged or required as a source, for making
the Payments, should adverse economic conditions lead to an increase in unemployment rates for residents in the City,
property tax collection rates within the City could be adversely affected.
7
City sales tax collections and other collections dependent on local business activity or tourism, which are another
significant revenue source for operating purposes and a source for making the Payments, may be materially adversely
affected by the continued spread of COVID-19 and ongoing public health policy and State restrictions related to various
business operations. The City, however, cannot predict the effect the continued spread of COVID-19 will have on its
sales tax collections, which could have a negative impact on the City’s ability to pay operating expenses or the Payments.
The State’s finances are likely to be adversely affected by the continued spread of COVID-19, the various governmental
actions taken in response thereto and changes in the behavior of businesses and people, which all could affect the amount
of State Shared Revenues distributed to municipalities, including the City.
The City, however, cannot predict how the spread of COVID-19, the ongoing public health policy and State restrictions,
or the various governmental or private actions taken in response thereto will affect its finances or operations, including
the receipt of State Shared Revenues, City sales taxes and property tax collections.
EXCISE TAXES
The Excise Taxes pledged to payment of the Payments due under the Agreement to be applied to Debt Service on the
Series 2021 Refunding Obligations and any Additional Parity Obligations include all unrestricted excise, transaction,
franchise, privilege and business taxes, state-shared sales and income taxes, fees for licenses and permits, and State-
revenue sharing, now or hereafter validly imposed by the City or contributed, allocated and paid over to the City and
not earmarked by the contributor for a contrary or inconsistent purpose (“Excise Taxes”). Excise Taxes include, without
limitation, all fines and forfeitures. Revenues generated by the City from development impact fees will not be deemed
Excise Taxes for the purpose of the Agreement and Trust Agreement. Revenues received by the City from vehicle
license taxes charged by the State of Arizona will not be deemed Excise Taxes for the purposes of the Agreement and
the Trust Agreement. The City may impose taxes for restricted purposes, the revenues from which will not be Excise
Taxes thereunder and will not be pledged to the payment of the amounts due pursuant to the Agreement and Trust
Agreement. Notwithstanding the pledge herein, the City intends to pay the Payments and Prepayments, if any, from the
revenues available in the City’s Water and Wastewater Funds.
From time to time, bills are introduced in, and legislation enacted by, the Arizona Legislature to change the formulas
used to allocate state-shared sales taxes and state-shared income taxes. The possibility of changes in this respect are
more likely to be adverse to the City when the State is experiencing financial difficulties. The City cannot determine
whether any such measures will become law or how they might affect the revenues which comprise state-shared
revenues. In addition, initiative measures are circulated from time to time seeking to place on the ballot changes in
Arizona law which would repeal or modify state sales taxes, state income taxes (the major source of funds for state
revenue sharing) and vehicle license taxes. The City cannot predict if any such initiative measures will ever actually be
submitted to the electors, what form the measures might take or the outcome of any such election. See “State-Shared
Sales Taxes” and “State-Shared Income Taxes.”
State law permits the State to withhold certain State-shared revenues from a city, town or county (a “Local Jurisdiction”)
if such Local Jurisdiction has passed an ordinance, regulation or other official action (a “Local Enactment”) that violates
State law or the State constitution, in the determination of the State Attorney General. Under the legislation, any member
of the State Legislature may ask the State Attorney General to investigate a Local Enactment. On being notified of a
determination by the State Attorney General, the Local Jurisdiction will have thirty days to resolve the violation as
determined by the State Attorney General, or if not, the State Attorney General is required to notify the State Treasurer
to withhold State-shared transaction privilege (sales) taxes and State-shared income taxes from such Local Jurisdiction
until the State Attorney General determines that no violation of State law exists. In withholding any such distributions
of such State-shared revenues, the State Treasurer may not withhold any amount that the affected Local Jurisdiction
certifies to the State Attorney General and the State Treasurer as being necessary to make any required deposits or
payments for debt service on bonds or other long-term obligations of such Local Jurisdiction that were issued or incurred
before committing the violation.
The City is not aware of any current or proposed Local Enactment of the City that would potentially violate State law.
If the City received a determination that an adopted Local Enactment violated State law in the determination of the State
Attorney General, the City expects it would take such reasonable and practicable actions as may be necessary to address
8
the issue within the thirty day period permitted by the legislation. Such actions would include notifying the State
Attorney General and the State Treasurer of the amounts of State-shared transaction privilege (sales) taxes and State-
shared income taxes necessary to make required deposits or debt service payments on the City’s long-term obligations
secured by such funds issued or incurred before the violation occurred and which could not be withheld.
9
City of Chandler
Excise Tax Collections
FY 2016-17 to FY 2021-22
2016-17 (a)
2017-18 (a)
2018-19 (a)
2019-20 (b)
Estimated
2020-21
Adopted
2021-22
City Transaction Privilege
(Sales) and Use Tax (c)
$120,189,651
$127,584,410
$138,888,825
$140,798,389
$145,018,200
$148,278,200
State-Shared Sales Tax
23,768,564
23,821,248
25,525,595
26,597,361
27,600,000
28,790,000
State-Shared Income Tax
31,910,426
30,652,381
30,693,731
33,255,159
37,000,000
33,500,000
Franchise Fees
3,272,104
3,560,770
3,556,211
3,432,995
3,342,100
2,980,000
Licenses and Permits
7,209,693
6,512,930
7,398,669
7,908,291
7,295,600
7,461,000
Fines and Forfeitures
2,560,255
3,368,445
3,196,843
2,714,065
2,643,200
3,745,500
Totals
$188,910,693
$195,500,184
$209,259,874
$214,706,260
$222,899,100
$224,754,700
____________________
(a) Amounts are actual collections provided by the City’s Budget Division (cash basis).
(b) Unaudited FY 2020-21 Revenues.
(c) Includes City Transaction Privilege Sales Tax, Privilege Audit Assessments, Privilege License Fees and Privilege
Tax Interest. Excludes Excise Tax Refunds from GPLET program.
Source: City of Chandler Management Services Department.
City Transaction Privilege (Sales) and Use Taxes. The City’s transaction privilege (sales) tax is levied upon persons
based on their business activities within the City. The amount of taxes are calculated by applying the tax rate against
the gross proceeds of sales or gross income (less allowable deductions) derived from the business activities shown in
the table below including the new Marijuana (Medical) and (Adult Use) categories. Transaction privilege (sales) taxes
are collected on a monthly basis.
City of Chandler
Transaction Privilege (Sales) Tax Rates by Category
Taxable
Activities
Chandler
Tax Rate
Taxable
Activities
Chandler
Tax Rate
Advertising
1.50%
Hotel/Motel (> 30 Days)
1.50%
Amusements
Construction Contracting
(non MRRA)
1.50%
1.50% of 65% of gross
Rentals – Real Property
Residential
Commercial
1.50%
1.50%
Jet Fuel Sales (and Use)
$0.02300/gallon
Tangible Personal Property Rentals
1.50%
Job Printing
1.50%
Car Rentals
1.50%
Manufactured Housing
1.50%
Restaurants/Bars
1.80%
Timber & Extraction
1.50%
Retail Sales
1.50%
Marijuana (Medical)
1.50%
Telecommunications
2.75%
Marijuana (Adult Use)
1.50%
Transportation for Hire
1.50%
Mining
0.10%
Utilities
2.75%
Publishing
1.50%
Use Tax
1.50%
Hotel/Motel (≤ 30 Days)
4.40% (1.50% + 2.90%)
____________________
Source: Arizona Department of Revenue.
State-Shared Sales Taxes. Pursuant to statutory formula, cities and towns in Arizona receive a portion of the State-
levied transaction privilege (sales) tax. The State transaction privilege (sales) tax is levied against the same categories
of business activity as the City’s transaction privilege (sales) tax, with a few exceptions, the largest of which being sales
10
of food for home consumption and residential rental receipts, both of which the State exempts from tax. As the table
below indicates, the rate of taxation varies among the different types of business activities taxed, with the most common
rate being 5% of the amount or volume of business transacted.
Under State law, the aggregate amount distributed to all Arizona cities and towns is equal to 25% of the “distribution
share” of revenues attributable to each category of taxable activity. The allocation to each city and town of the revenues
available to all cities and towns is based on their population relative to the aggregate population of all cities and towns
as shown by the mid-decade census. State-levied transaction privilege (sales) taxes are collected by the State and are
distributed monthly to cities and towns.
In addressing State budgetary deficiencies, the Governor and members of the State legislature have occasionally
proposed certain adjustments that would reduce the distribution of State-Shared Sales Taxes to cities and towns. The
City cannot determine whether such measures will become law or how they might affect the City’s receipt of State-
Shared Sales Taxes.
STATE SALES TAX
Taxable Activities, Tax Rates and Distribution Share
Taxable Activities
State
Tax Rate
Education
Tax Rate (a)
Distribution
Share
Transporting
5.000%
0.600%
20.000%
Utilities
5.000%
0.600%
20.000%
Telecommunications
5.000%
0.600%
20.000%
Pipeline
5.000%
0.600%
20.000%
Private car line
5.000%
0.600%
20.000%
Publication
5.000%
0.600%
20.000%
Job printing
5.000%
0.600%
20.000%
Prime contracting
5.000%
0.600%
20.000%
Owner builder sales
5.000%
0.600%
20.000%
Amusement
5.000%
0.600%
40.000%
Restaurant
5.000%
0.600%
40.000%
Personal property rental
5.000%
0.600%
40.000%
Retail (excluding food sales)
5.000%
0.600%
40.000%
Transient lodging
5.500%
N/A
50.000%
Mining - non-metal, oil/gas
3.125%
N/A
32.000%
Commercial lease
0.000%
N/A
53.330%
Severance - metalliferous mining
2.500%
N/A
80.000%
Use tax utilities
5.000%
0.600%
20.000%
Jet fuel use tax
(b)
N/A
40.000%
_______________________
(a)
Represents the State transaction privilege (sales) tax rate approved by voters of the State in November 2000 (the
“Education Tax”) on certain of the categories of business activity at six-tenths of one percent (0.6%). The
Education Tax collections are dedicated exclusively to education and are not distributed to the City or pledged
to the payment of debt service with respect to the Series 2021 Refunding Obligations. The effective dates for the
Education Tax are June 1, 2001 through June 30, 2021.
(b)
Does not include a State Tax of $0.0305 per gallon levied on the retail sale of jet fuel, which tax is only levied
on the first ten million gallons sold to each purchaser in each calendar year.
Source: Arizona Department of Revenue.
11
State-Shared Income Taxes. Under current State law, Arizona cities and towns are preempted by the State from
imposing a local income tax. Cities and towns are, however, entitled by statutory formula to typically receive 15%
(18% in FY2021-22 and forward) of State personal and corporate income tax collections. Distribution of such funds is
made monthly based on the proportion of each city’s population to the total populations of all incorporated cities and
towns in the State as determined by the mid-decade special census. In addressing State budgetary deficiencies, the
Governor and members of the State legislature have occasionally proposed certain adjustments that would reduce the
distribution of State-Shared Income Taxes to cities and towns. The City cannot determine whether any such proposals
will occur in the future and become law or how they might affect the City’s receipt of State-Shared Income Taxes.
State Vehicle License Tax. Approximately twenty percent of the revenues collected for the licensing of motor vehicles
is distributed to incorporated cities and towns. A city or town receives its share of the vehicle license tax collections
based on its population in relation to the total incorporated population of the county. These monies are distributed on a
monthly basis. The only stipulation on the use of this revenue is that it must be expended for a public purpose. State-
Shared Vehicle License Taxes are excluded from Excise Taxes for purposes of the Agreement and Trust Agreement.
Franchise Fee Revenues. Cities and towns in the State have exclusive control over public rights of way dedicated to
the municipality, and may grant franchise agreements to and impose franchise taxes on utilities using those rights o f
way. A franchise may be granted only with voter approval and the term of franchises is limited to 25 years. The City
has granted franchises to and imposed franchise taxes on utility and cable television providers.
Other Excise Tax Revenues. The City also imposes and collects fees for licenses and permits to engage in certain
activities within the City and for the right to utilize certain City property and imposes and collects fines and forfeitures
for violations of State laws or City ordinances relating to traffic and other offenses.
PLAN OF REFUNDING
On or before the date of initial delivery, a portion of the proceeds of the Series 2021 Refunding Obligations will be
placed in a special trust fund (the “Escrow Trust”) created pursuant to a Depository Trust Agreement to be dated as of
_______ 1, 2021* (the “Depository Trust Agreement”), by and among the City, the trustees of the respective series of
the Obligations Being Refunded and the Trustee, as escrow trustee (the “Depository Trustee”), and used to acquire
obligations issued or guaranteed by the United States of America (the “Government Obligations”), the principal of and
interest on which, when due, are calculated to be in an amount sufficient to provide monies to pay the principal of and
interest on the Obligations Being Refunded to their respective redemption dates and to pay the redemption prices of the
Obligations Being Refunded pursuant to the terms of the Depository Trust Agreement. See “OBLIGATIONS TO BE
REFUNDED” and “VERIFICATION OF MATHEMATICAL COMPUTATIONS” herein.
[Remainder of page intentionally left blank]
* Preliminary, subject to change.
12
OBLIGATIONS TO BE REFUNDED*
The following table sets forth the issue series, stated maturity dates, interest rates, principal amounts outstanding and to
be refunded, redemption dates and CUSIP numbers of the Obligations Being Refunded. The Obligations Being
Refunded will be redeemed at prices equal to the principal amounts thereof, plus interest accrued to their respective
redemption dates, without premium.
Issue
Series
Maturity
Date
(July 1)
Interest
Rate
Principal
Amount
Outstanding
Principal
Amount
Refunded
Redemption
Date
Redemption
Price
CUSIP No.
158855 (a)
2011
2022
4.000%
$ 905,000
$ 905,000
11/08/2021
100%
BF2
2013
2024
5.000
4,500,000
4,500,000
7/1/2023
100
BX3
2025
5.000
4,700,000
4,700,000
7/1/2023
100
BY1
2026
5.000
5,000,000
5,000,000
7/1/2023
100
BZ8
2027
5.000
5,000,000
5,000,000
7/1/2023
100
CA2
2028
5.000
4,900,000
4,900,000
7/1/2023
100
CB0
2029
4.000
11,500,000
11,500,000
7/1/2023
100
CC8
2030
4.000
11,500,000
11,500,000
7/1/2023
100
CD6
2031
4.000
12,000,000
12,000,000
7/1/2023
100
CE4
2032
4.000
12,000,000
12,000,000
7/1/2023
100
CF1
2033
4.125
12,000,000
12,000,000
7/1/2023
100
CG9
2016REF
2028
5.000
3,050,000
3,050,000
7/1/2026
100
DL7
$87,055,000
$87,055,000
_______________________
(a) See footnote (a) on the inside front cover page.
VERIFICATION OF MATHEMATICAL COMPUTATIONS
Because the holders of the Series 2021 Refunding Obligations rely on the sufficiency of the Government Obligations
and other monies held in the Depository Trust, the City will provide a verification of the mathematical computations
pertaining to the sufficiency of the Depository Trust. Samuel Klein and Company, Certified Public Accountants, in
conjunction with Public Finance Partners LLC (the “Verification Agent”), will deliver to the City, on or before the issue
date of the Series 2021 Refunding Obligations, its verification report indicating, among other things, that it has verified
the mathematical accuracy of the sufficiency of the anticipated receipts from the Government Obligations, together with
the initial cash deposit, to pay, when due, the principal of, interest and applicable premiums, if any, on the Obligations
Being Refunded. Included in the scope of its verification will be a verification of the accuracy of the mathematical
computations determining that the cash and the maturing principal of and interest on the Government Obligations will
pay, when due at prior redemption on their respective redemption dates the principal of and interest on the Series 2021
Refunding Obligations. Such verification will be based solely on mathematical computations, information and
documents provided to the Verification Agent by Piper Sandler & Co. (the “Financial Advisor”) on behalf of the City.
The Verification Agent will have no obligation to update the report because of events occurring, or data or information
coming to their attention, subsequent to the date of the report.
* Preliminary, subject to change
13
SOURCES AND USES OF FUNDS
Sources of Funds
Principal Amount
$95,265,000.00*
[Net] Original Issue Premium (a)
Total Sources
Uses of Funds
Deposit to Depository Trust
Costs of Issuance (b)
Total Uses
(a) [Net] Original Issue Premium is the original issue premium on the Series 2021 Refunding Obligations less the
original issue discount on the Series 2021 Refunding Obligations.
(b) Includes fees of Special Counsel (as defined herein), Trustee (as defined herein), Depository Trustee, printing costs,
rating agency fees and other costs related to the delivery of the Series 2021 Refunding Obligations, including
compensation and costs of the Underwriters (as defined herein).
[Remainder of page intentionally left blank]
* Preliminary, subject to change.
14
The following schedule sets forth (i) the annual debt service requirements on the City’s Outstanding Excise Tax Obligations, the payment of which is secured by a pledge of the Excise
Taxes, (ii) less the Obligations Being Refunded, (iii) plus the estimated debt service of the Series 2021 Refunding Obligations, (iv) the total estimated annual debt service requirements
of the Series 2021 Refunding Obligations, (v) the combined estimated annual debt service requirements on Parity Obligations following the issuance of the Series 2021 Refunding
Obligations, and (vi) the projected debt service coverage provided by the Excise Taxes.
SCHEDULE OF ESTIMATED DEBT SERVICE COVERAGE ON OBLIGATIONS AND PARITY OBLIGATIONS* (a)
___________________
(a) Prepared by the Financial Advisor. Columns may not add up due to rounding.
(b) Excise Tax revenues shown represent collections for Fiscal Year 2020.
(c) Interest is estimated. The first interest payment on the Series 2021 Refunding Obligations will be due January 1, 2022*. Thereafter, the interest payments will be made
semiannually on January 1 and July 1 until maturity or prior redemption.
(d) The City intends to pay amounts representing debt service on the Series 2021 Refunding Obligations and the outstanding Parity Obligations from revenues available in the City’s
water and wastewater enterprise funds (the “Water and Wastewater Funds”). In the event that these revenues prove insufficient to pay such amounts due for debt service on the
Series 2021 Refunding Obligations, or if the City decides not to pay such amounts from the revenues of the Water and Wastewater Funds, amounts due for debt service on the
Series 2021 Refunding Obligations will then be paid from Excise Taxes. See “SECURITY AND SOURCES OF PAYMENT” and “EXCISE TAXES” herein.
* Preliminary, subject to change.
Fiscal
Outstanding
Estimated
Water & Wastewater
Year
Excise Tax Obligation
The Obligations
The Series 2021
Projected
Annual Excise Tax
Revenue Supported
Net Excise Tax Supported
Ended
Excise Tax
Bonded Debt
To Be Refunded*
Refunding Obligations*
Debt Service
Obligation Bonded
Excise Tax
Debt Service
June 30
Revenues (b)
Debt Service
Principal
Interest (c)
Principal
Interest (b)
Coverage
Debt Service*
Obligation Debt Service (d)
Requirements
2022
214,706,260
$
20,002,375
$
905,000
$
3,616,200
$
2,860,000
$
914,762
$
10.65x
19,255,937
$
19,255,937
$
$0
2023
20,020,475
3,580,000
1,425,000
1,403,985
19,269,460
19,269,460
2024
20,348,475
4,500,000
3,580,000
5,935,000
1,397,886
19,601,361
19,601,361
2025
20,355,225
4,700,000
3,355,000
5,950,000
1,357,528
19,607,753
19,607,753
2026
19,059,475
5,000,000
3,120,000
6,070,000
1,302,312
18,311,787
18,311,787
2027
20,959,525
5,000,000
2,870,000
5,890,000
1,233,843
20,213,368
20,213,368
2028
18,804,775
7,950,000
2,772,500
8,660,000
1,159,158
17,901,433
17,901,433
2029
22,152,225
11,500,000
2,375,000
11,940,000
1,036,359
21,253,584
21,253,584
2030
21,801,225
11,500,000
1,915,000
11,660,000
851,886
20,898,111
20,898,111
2031
21,948,775
12,000,000
1,455,000
11,895,000
660,079
21,048,854
21,048,854
2032
21,644,525
12,000,000
975,000
11,620,000
452,511
20,742,036
20,742,036
2033
21,278,925
12,000,000
495,000
11,360,000
232,312
20,376,237
20,376,237
2034
8,883,125
8,883,125
8,883,125
2035
8,867,275
8,867,275
8,867,275
2036
3,062,500
3,062,500
3,062,500
2037
3,052,500
3,052,500
3,052,500
272,241,400
$
87,055,000
$
30,108,700
$
95,265,000
$
12,002,621
$
262,345,321
$
262,345,321
$
$0
Plus:
Less:
15
TAX MATTERS
In the opinion of Gust Rosenfeld P.L.C., Phoenix, Arizona (“Special Counsel”), interest income on the Series 2021
Refunding Obligations is exempt from Arizona income taxes. Additionally, in the opinion of Special Counsel, interest
income on the Series 2021 Refunding Obligations is subject to federal taxes. Special Counsel expresses no opinion as
to any other tax consequences regarding the Series 2021 Refunding Obligations. INTEREST ON THE SERIES 2021
REFUNDING OBLIGATIONS IS NOT EXCLUDED FROM GROSS INCOME FOR FEDERAL INCOME TAX
PURPOSES. THE LEGAL DEFEASANCE OF THE SERIES 2021 REFUNDING OBLIGATIONS MAY RESULT
IN A DEEMED SALE OR EXCHANGE OF THE SERIES 2021 REFUNDING OBLIGATIONS UNDER CERTAIN
CIRCUMSTANCES, AND OWNERS OF THE SERIES 2021 REFUNDING OBLIGATIONS SHOULD CONSULT
THEIR OWN TAX ADVISORS
AS TO THE FEDERAL, STATE AND LOCAL, AND FOREIGN TAX
CONSEQUENCES OF THEIR ACQUISITION, OWNERSHIP AND DISPOSITION OF SERIES 2021 REFUNDING
OBLIGATIONS.
The following discussion is generally limited to “U.S. owners,” meaning Beneficial Owners of Series 2021 Refunding
Obligations that for United States federal income tax purposes are individual citizens or residents of the United States,
corporations or other entities taxable as corporations created or organized in or under the laws of the United States or
any state thereof (including the District of Columbia), and certain estates or trusts with specific connections to the United
States. Partnerships holding the Series 2021 Refunding Obligations, and partners in such partnerships, should consult
their own tax advisors regarding the tax consequences of an investment in the Series 2021 Refunding Obligations
(including their status as U.S. owners).
Original Issue Discount
The initial public offering price of the Obligations maturing July 1, 20__ through and including July 1, 20__
(collectively, the “Discount Obligations”), are less than the respective amounts payable at maturity. As a result, the
Discount Obligations will be considered to be issued with original issue discount. The difference between the initial
public offering price (assuming it is the first price at which a substantial amount of that maturity of Discount Obligations
was sold (the “OID Issue Price”)) of the Discount Obligations, and the amount payable at maturity of the Discount
Obligations will be treated as “original issue discount.” With respect to a Beneficial Owner who purchases a Discount
Obligations in the initial public offering at the OID Issue Price and who holds the Discount Obligations to maturity, the
full amount of original issue discount will constitute interest income which is includible in the gross income of the
Beneficial Owner of the Discount Obligations for federal income tax purposes, but not for Arizona income tax purposes,
and that Beneficial Owner will not, under present federal income tax law and present Arizona income tax law, realize a
taxable capital gain upon payment of the Discount Obligations at maturity.
The original issue discount on each of the Discount Obligations is treated for federal income tax purposes and Arizona
income tax purposes as accreting daily over the term of such Discount Obligations on the basis of a constant interest
rate compounded at the end of each six-month period (or shorter period from the date of original issue) ending on
January 1 and July 1 (with straight-line interpolation between compounding dates).
The amount of original issue discount accreting each period will be added to the Beneficial Owner’s tax basis for the
Discount Obligations. The adjusted tax basis will be used to determine taxable gain or loss upon disposition of the
Discount Obligations. An initial Beneficial Owner of a Discount Obligations who disposes of the Discount Obligations
prior to maturity should consult his or her tax advisor as to the amount of the original issue discount accrued over the
period held and the amount of taxable gain or loss upon the sale or disposition of the Discount Obligations prior to
maturity.
The Code contains certain provisions relating to the accretion of original issue discount in the case of subsequent
Beneficial Owners of the Discount Obligations. Beneficial Owners who do not purchase the Discount Obligations in
the initial offering at the OID Issue Price should consult their own tax advisors with respect to the tax consequences of
the ownership of Discount Obligations.
A portion of the original issue discount that accretes in each year to a Beneficial Owner of a Discount Obligations may
result in certain collateral federal income tax consequences.
16
Beneficial Owners of Discount Obligations in states other than Arizona should consult their own tax advisors with
respect to the state and local tax consequences of owning Discount Obligations.
Obligations Purchased at a Premium
The initial public offering price of Series 2021 Refunding Obligations maturing on July 1, 20__ through and including
July 1, 20__ (collectively, the “Premium Obligations”) are greater than the amount payable on such Premium
Obligations at maturity. An amount equal to the difference between the initial public offering price of a Premium
Obligations (assuming that a substantial amount of the Premium Obligations of that maturity are sold to the public at
such price) and the amount payable at maturity constitutes premium to the initial Beneficial Owner of such Premium
Obligations. The basis for federal income tax purposes of a Premium Obligations in the hands of such initial Beneficial
Owner may be reduced each year by the amortizable obligation premium, if elected by such Beneficial Owner. If
elected, the amount of amortizable obligation premium also will be treated as a federal income tax deduction. Such
reduction in basis will increase the amount of any gain (or decrease the amount of any loss) to be recognized for federal
income tax purposes upon a sale or other taxable disposition of a Premium Obligations. The amount of premium which
is amortizable each year by an initial Beneficial Owner is determined by using such Beneficial Owner’s yield to
maturity. Beneficial Owners of the Premium Obligations should consult with their own tax advisors with respect to the
determination of amortizable obligation premium with respect to the Premium Obligations s for federal income tax
purposes and with respect to the state and local tax consequences of owning Premium Obligations.
Disposition of Obligations
A Beneficial Owner of Series 2021 Refunding Obligations will generally recognize gain or loss on the redemption, sale
or exchange of a Series 2021 Refunding Obligation equal to the difference between the redemption or sales price
(exclusive of the amount paid for accrued interest) and the Beneficial Owner’s adjusted tax basis in the Series 2021
Refunding Obligations. Generally, the Beneficial Owner’s adjusted tax basis in the Series 2021 Refunding Obligations
will be the Beneficial Owner’s initial cost, increased by the original issue discount previously included in the Beneficial
Owner’s income to the date of disposition and decreased by any amortized obligation premium. Any gain or loss
generally will be capital gain or loss and will be long-term or short-term, depending on the Beneficial Owner’s holding
period for the Series 2021 Refunding Obligations.
Defeasance
Persons considering the purchase of a Series 2021 Refunding Obligation should be aware that a defeasance of a Series
2021 Refunding Obligation by the City could result in the realization of gain or loss by the Beneficial Owner of the
Series 2021 Refunding Obligation for federal income tax purposes, without any corresponding receipts of monies by
the Beneficial Owner. Such gain or loss generally would be subject to recognition for the tax year in which such
realization occurs, as in the case of a sale or exchange.
Information Reporting and Backup Withholding
General information reporting requirements will apply to payments of principal and interest made on a Series 2021
Refunding Obligation and the proceeds of the sale of a Series 2021 Refunding Obligation to non-corporate holders of
the Series 2021 Refunding Obligations, and “backup withholding” at a rate of twenty-four percent (24%) will apply to
such payments if the owner fails to provide an accurate taxpayer identification number in the manner required or fails
to report all interest required to be shown on its federal income tax returns. A Beneficial Owner of a Series 2021
Refunding Obligation that is a U.S. owner generally can obtain complete exemption from backup withholding by
providing a properly completed IRS Form W-9 (Request for Taxpayer Identification Number and Certification).
Non-U.S. Owners
Holders who are not United States persons as defined for federal tax purposes may be subject to special rules and should
consult their tax advisors.
17
Circular 230
THE FOREGOING DISCUSSION IN “TAX MATTERS” WAS NOT INTENDED OR WRITTEN BY SPECIAL
COUNSEL TO BE USED, AND IT CANNOT BE USED, FOR THE PURPOSE OF AVOIDING PENALTIES THAT
MAY BE IMPOSED ON AN OWNER OF A SERIES 2021 REFUNDING OBLIGATION. EACH PROSPECTIVE
PURCHASER OF THE SERIES 2021 REFUNDING OBLIGATIONS SHOULD SEEK ADVICE BASED ON THE
PROSPECTIVE
PURCHASER’S
PARTICULAR
CIRCUMSTANCES
FROM
AN INDEPENDENT
TAX
ADVISOR.
LEGAL MATTERS
Certain legal matters relating to the authorization, sale and execution and delivery of the Series 2021 Refunding
Obligations and tax matters with respect to the interest on the Series 2021 Refunding Obligations are subject to the legal
opinion of Special Counsel. (See “TAX MATTERS”). The signed legal opinion of Special Counsel dated and premised
on facts existing and law in effect as of the date of original execution and delivery of the Series 2021 Refunding
Obligations, will be delivered to the City at the time of original execution and delivery of the Series 2021 Refunding
Obligations.
The proposed form of the legal opinion is set forth as APPENDIX C – “FORM OF OPINION OF SPECIAL
COUNSEL”. The legal opinion to be delivered may vary from the text of APPENDIX C – “FORM OF OPINION OF
SPECIAL COUNSEL” if necessary to reflect facts and law on the date of delivery. The opinion will speak only as of
its date, and subsequent distributions of it by recirculation of this Official Statement or otherwise shall create no
implication that Special Counsel has reviewed or expresses any opinion concerning any of the matters referred to in the
opinion subsequent to its date. In rendering its opinion, Special Counsel will rely upon certificates and representations
of facts to be contained in the transcript of proceedings which Special Counsel will not have independently verified.
Such legal opinion expresses the professional judgment of Special Counsel as to the legal issues explicitly addressed
therein. By rendering a legal opinion, the opinion giver does not become an insurer or guarantor of that expression of
professional judgment, of the transaction opined upon, or of the performance of parties to the transaction. The rendering
of an opinion also does not guarantee the outcome of any legal dispute that may arise out of the transaction.
LITIGATION
To the knowledge of the appropriate representatives of the City, no litigation or administrative action or proceeding is
pending or threatened restraining or enjoining, or seeking to restrain or enjoin, the execution or delivery of the Series
2021 Refunding Obligations or contesting or questioning the proceedings and authority under which the Series 2021
Refunding Obligations have been authorized and are to be executed, sold or delivered, or the validity of the sale of the
Series 2021 Refunding Obligations.
[There are several claims and/or lawsuits pending against the City of Chandler. The City retains responsibility for
payment of the first one million seven hundred fifty thousand dollars ($1,750,000.00) of each loss, and has excess
insurance coverage for the next thirty million ($30,000,000.00) dollars. The City is adequately funded for its retention.
The largest lawsuit currently filed against the City alleges that a police officer participating in a regional task force
contributed to the death of an unarmed passenger when he participated in a vehicle containment maneuver that allegedly
led to the death of the suspect and passenger. The City received a notice of claim in the amount of five million dollars
($5,000,000). The City is a Co-defendant in the case and is currently preparing a motion for summary judgement for
the dismissal of the case
CANCELLATION OF CONTRACTS
The provisions of A.R.S. Section 38-511, as amended, provide that certain public bodies, including the City, may, within
three years after its execution, cancel any contract, without penalty or further obligation, made by the public body if any
person significantly involved in the initiating, negotiating, securing, drafting or creating of the contract on behalf of the
public body is, at any time while the contract or any extension thereof is in effect, an employee of any other party to the
18
contract in any capacity or a consultant to any other party to the contract with respect to the subject matter thereof. The
cancellation shall be effective when written notice from the governing body of the public body is received by all other
parties to the contract unless the notice specifies a later time. The City is a party to several contracts which are materia l
to the payment of the Series 2021 Refunding Obligations, including the Trust Agreement and the Agreement. Exercise
of a remedy under A.R.S. Section 38-511, as amended, would adversely affect the repayment of the Series 2021
Refunding Obligations.
FINANCIAL STATEMENTS
The financial statements of the City as of June 30, 2020 and for its fiscal year then ended, which are included as
APPENDIX E – “CITY OF CHANDLER, ARIZONA – AUDITED FINANCIAL STATEMENTS OF THE CITY OF
CHANDLER, ARIZONA FOR THE FISCAL YEAR ENDED JUNE 30, 2020” of this Official Statement, have been
audited by Heinfeld, Meech & Co., P.C., as stated in their opinion which appears in APPENDIX E – “CITY OF
CHANDLER, ARIZONA – AUDITED FINANCIAL STATEMENTS OF THE CITY OF CHANDLER, ARIZONA
FOR THE FISCAL YEAR ENDED JUNE 30, 2020”. The City neither requested nor obtained the consent of Heinfeld,
Meech & Co., P.C., to include their report and Heinfeld, Meech & Co., P.C., has performed no procedures subsequent
to rendering their opinion on the financial statements.
CONTINUING SECONDARY MARKET DISCLOSURE
The City will covenant for the benefit of certain owners of the Series 2021 Refunding Obligations to provide certain
financial information and operating data relating to the City by not later than February 1 in each year commencing
February 1, 2022 (the “Annual Reports”), and to provide notices of the occurrence of certain enumerated events (the
“Notices of Listed Events”), dated the date of delivery of the Series 2021 Refunding Obligations (the “Undertaking”),
the form of which is included in APPENDIX G – “FORM OF CONTINUING DISCLOSURE CERTIFICATE.” The
Undertaking by the City will only apply so long as the Series 2021 Refunding Obligations remain outstanding. The
Notices of Listed Events and any other document or information required to be filed, will be filed with the MSRB
through the MSRB’s EMMA system each described in APPENDIX G – “FORM OF CONTINUING DISCLOSURE
CERTIFICATE”. The specific nature of the information to be contained in the Annual Reports is set forth in
APPENDIX G. The Undertaking will be delivered in order to assist the original purchaser of the Series 2021 Refunding
Obligations in complying with the Securities and Exchange Commission Rule 15c2-12, as amended (the “Rule”). A
failure by the City to comply with the Undertaking must be reported in accordance with the Rule and must be considered
by any broker, dealer or municipal securities dealer before recommending the purchase or sale of the Series 2021
Refunding Obligations in the secondary market. The City has been and is now in material compliance with all of its
Prior Undertakings (as defined herein) for purposes of the Rule.
Continuing disclosure undertakings previously entered into by the City (the "Prior Undertakings") called for the City to
file Annual Reports with EMMA for the fiscal year ended June 30, 2014, by February 1 of the following year. The City
timely filed Annual Reports for all of its bonds and obligations except for its Improvement District No. 89 Improvement
Bonds, which Annual Report was not related to the CUSIP number for the above-referenced bonds and was therefore
inadvertently omitted from the general continuing disclosure filings of the City.
The City’s Management Services Department has instituted written procedures to facilitate compliance with existing
continuing disclosure undertakings, the continuing disclosure undertaking related to the Series 2021 Refunding
Obligations, and future undertakings in all material respects. The City believes it is currently in material compliance
with all of its continuing disclosure requirements.
RATINGS
Fitch Ratings, Inc. (“Fitch”), Moody’s Investors Service, Inc. (“Moody’s”) and S&P Global Ratings, a division of
Standard & Poor’s Financial Services LLC (“S&P”), have assigned the ratings of “___”, “___” and “___,” respectively,
on the Series 2021 Refunding Obligations. Such ratings reflect only the views of Fitch, Moody’s and S&P. An
explanation of the significance of the Fitch rating may be obtained at One State Street Plaza, New York, New York
10040. An explanation of the significance of a rating assigned by Moody’s may be obtained at 7 World Trade Center,
19
250 Greenwich Street, New York, New York 10007. An explanation of the significance of a rating assigned by S&P
may be obtained at 55 Water Street, New York, New York 10041. Such ratings may be revised downward or withdrawn
entirely by Fitch, Moody’s, or S&P, if, in their respective judgment, circumstances so warrant. Any downward revision
or withdrawal of such ratings may have an adverse effect on the market price of the Series 2021 Refunding Obligations.
The City has covenanted in its continuing disclosure certificate (see “CONTINUING SECONDARY MARKET
DISCLOSURE” herein) that it will file notice of any formal change in any such rating relating to the Series 2021
Refunding Obligations.
UNDERWRITING
__________________ (collectively, the “Underwriters”) have agreed to purchase the Series 2021 Refunding
Obligations, subject to certain conditions, at a purchase price equal to $_______, pursuant to a bond purchase contract
entered into among t the City and the Underwriters. If the Series 2021 Refunding Obligations are sold to produce the
prices or yields shown on the inside front cover pages hereof, the Underwriters’ compensation will be $_______. The
Underwriters will be obligated to accept delivery and pay for all of the Series 2021 Refunding Obligations if any are
delivered. The Underwriters may subsequently offer and sell the Series 2021 Refunding Obligations to certain dealers
(including dealers depositing the Series 2021 Refunding Obligations into unit investment trusts) and others at prices
higher or yields lower than the initial public offering prices or yields reflected on the inside front cover pages hereof.
The initial offering prices or yields set forth on the inside front cover pages may be changed, from time to time, by the
Underwriters without amendment of this Official Statement.
POLITICAL DONATIONS
To the best of their knowledge, none of the City, the Trustee, Registrar and Paying Agent, the Financial Advisor or their
counsel or agents are known to have made political contributions other than those, if any, permitted under applicable
securities regulations to any person who sought a seat on the City Council at its last election or any election prior to the
last election.
CERTIFICATION CONCERNING OFFICIAL STATEMENT
Documents delivered with respect to the Series 2021 Refunding Obligations will include a certificate to the effect that
to the knowledge of the Management Services Director of the City after appropriate review, this Official Statement is
true, correct and complete in all material respects and does not include any untrue statement of a material fact or omit
to state any material fact necessary to make such statements and information herein, in light of the circumstances under
which they were made, not misleading and that no event has occurred since date of this Official Statement that should
be disclosed herein in order to make the statements and information herein not misleading in any material respect.
ADDITIONAL INFORMATION
Legal matters relating to the validity of the Series 2021 Refunding Obligations under Arizona law, and with regard to
the tax-exempt status of the interest thereon (see “TAX MATTERS”) will be prepared by Gust Rosenfeld P.L.C.,
Phoenix, Arizona, Special Counsel. The signed legal opinion of Special Counsel dated and premised on the law in effect
only as of the date of original delivery of the Series 2021 Refunding Obligations, will be delivered to the City at the
time of original issuance.
The form of the legal opinion is set forth as APPENDIX C. The legal opinion to be delivered may vary from the text of
APPENDIX C if necessary to reflect the facts and law on the date of delivery. The opinion will speak only as of its date,
and subsequent distribution, by recirculation of this Official Statement or otherwise, should not be construed as a
representation that Special Counsel has reviewed or expressed any opinion concerning any matters relating to the Series
2021 Refunding Obligations subsequent to the original delivery of the Series 2021 Refunding Obligations.
20
Such legal opinion expresses the professional judgment of Special Counsel as to the legal issues explicitly addressed
therein. By rendering a legal opinion, the opinion giver does not become an insurer or guarantor of that expression of
professional judgment, of the transaction opined upon, or of the performance of parties to the transaction. The rendering
of an opinion also does not guarantee the outcome of any legal dispute that may arise out of the transaction.
The Financial Advisor has been engaged by the City for the purpose of advising the City as to certain debt service
structuring matters specific to the Series 2021 Refunding Obligations, and on certain matters relative to the overall debt
financing program of the City. The Financial Advisor has assisted in the assemblage and preparation of this Official
Statement at the direction and on behalf of the City. No person is entitled to rely on the Financial Advisor’s participation
as an assumption of responsibility for, or an expression of opinion of any kind with regard to, the accuracy or
completeness of the information contained herein.
The information in this Official Statement has been provided by the City, the Maricopa County, Arizona, Assessor’s,
Treasurer’s and Finance offices, the Arizona Department of Revenue and other sources which are considered to be
reliable and are customarily relied upon in the preparation of similar official statements, but such information is not
guaranteed as to accuracy or completeness. All estimates and assumptions contained herein are believed to be reliable,
but no representations are made that such estimates and assumptions are correct or will be realized. Any information
or expressions of opinion herein are subject to change without notice and neither the delivery of this Official Statement
nor any sale hereunder shall under any circumstances create an implication that there has been no change as to the affairs
of the City. This Official Statement may be supplemented from time to time by the provision of supplemental or
additional documents.
From time to time, there are legislative proposals (and interpretations of such proposals by courts of law and other
entities and individuals) which, if enacted, could alter or amend the property tax system of the State and numerous
matters, both financial and nonfinancial, impacting the operations of municipalities which could have a material impact
on the City and could adversely affect the secondary market value of the Series 2021 Refunding Obligations. It cannot
be predicted whether or in what form any such proposal might be enacted or whether, if enacted, it would apply to
obligations (such as the Series 2021 Refunding Obligations) issued prior to enactment.
CONCLUDING STATEMENT
The summaries or descriptions of provisions in the Agreement and the Trust Agreement contained herein and all
references to other materials not purporting to be quoted in full are only brief outlines of certain provisions thereof and
do not constitute complete statements of such provisions and do not summarize all the pertinent provisions of such
documents. For further information, reference should be made to the complete documents, copies of which are available
for inspection from the Financial Advisor.
To extent that any statements made in this Official Statement involve matters of opinion or estimates, whether or not
expressly stated to be such, they are made as such and not as representations of fact or certainty and no representation
is made that any of these opinions or estimates have been or will be realized. Information in this Official Statement has
been derived by the City from official records and other sources and is believed to be reliable. Information other than
that obtained from the official records of the City has not been independently confirmed or verified by the City and its
accuracy is not guaranteed. The presentation of information, including tables of receipts from taxes and other sources,
is intended to show recent historic information and is not intended to indicate future or continuing trends in the financial
position or other affairs of the City. No representation is made that past experience, as is shown by that financial or
other information, will necessarily continue or be repeated in the future.
Neither this Official Statement nor any statement that may have been or that may be made orally or in writing is to be
construed as part of a contract or agreement between the City and the purchasers or holders of any Obligations.
The attached Appendices A through G are integral parts of this Official Statement and must be read together with all of
the foregoing statements.
21
This Official Statement has been prepared on direction of the City and has been approved by and executed for and on
behalf of the City by its authorized representative indicated below.
CITY OF CHANDLER, ARIZONA
By: ______________________________
Kevin Hartke, Mayor
A-1
APPENDIX A
CITY OF CHANDLER, ARIZONA,
GENERAL ECONOMIC AND DEMOGRAPHIC INFORMATION
General
The City is located in the southeastern portion of Maricopa County, Arizona (the “County”). The City encompasses
approximately 65 square miles and is one of several major cities comprising the greater Phoenix, Arizona metropolitan
area, which is Arizona’s economic, political and population center.
The City was founded in 1912 and incorporated in 1920. The following table sets forth a record of the population
statistics of the City since 1980, along with the population statistics for the County and the State.
POPULATION STATISTICS
City of
Maricopa
State of
Year
Chandler
County
Arizona
2020 Estimate (a)
272,011
4,439,220
7,294,587
2010 Census (Revised)
236,326
3,817,117
6,392,017
2005 Special Census
233,681
3,700,516
6,044,985
2000 Census
176,581
3,072,149
5,130,632
1990 Census
90,533
2,122,101
3,665,305
1980 Census
29,673
1,509,175
2,716,546
(a)
Provisional estimate as of July 1, 2020. (Published December, 2020).
Source:
U.S. Census Bureau and the Office of Employment & Population Statistics, Arizona Department of
Administration.
The following table contains historic information in regard to the geographic incorporated size of the City as set forth
in square miles.
LAND AREA
City of Chandler, Arizona
Square
Year
Miles
2020
65.53
2019
65.33
2018
65.19
2017
65.07
2016
65.05
Source:
The City Management Services Department and City Planning Division.
A-2
Municipal Government and Organization
The City adopted the City Charter in 1965 which provides for a Council-Manager form of government. The seven-
member City Council is elected at-large on a staggered basis and consists of the Mayor and six councilmembers. The
current Mayor and councilmembers serve four-year terms.
The City Council appoints the City Manager who has full responsibility for carrying out City Council policies and
administering City operations. The City Manager is responsible for appointment of department heads. The City
employees are hired under procedures as specified in the City Charter. The government and operations of the City are
provided by a staff of 1,702.75 full-time employees.
Economy
The major industry clusters contributing to the economic base of the City include government, manufacturing, financial
services, commercial activities (including construction and commerce), high technology and healthcare. The City is
home to a wide variety of technology industries, with a heavy concentration in the semiconductor cluster. The continued
economic development of the City is driven by the educational attainment of Chandler residents. Approximately 76%
of adult residents have attended some college and 45% possess a bachelor’s or advanced degree. This educational
attainment level attracts employers in “knowledge based” industries adding to the concentration of high wage jobs.
The following table sets forth unemployment rate averages for the City, the County, the State and the United States.
UNEMPLOYMENT RATE AVERAGES
Calendar
City of
Maricopa
State of
United
Year
Chandler
County
Arizona
States
2021 (a)
5.5%
6.3%
6.7%
6.2%
2020
6.6
7.3
7.8
8.1
2019
3.5
4.0
4.7
3.7
2018
3.6
4.1
4.7
3.9
2017
3.7
4.2
4.9
4.4
2016
4.0
4.6
5.4
4.9
(a) Data through May 31, 2021 and is not seasonally adjusted.
Source:
Arizona Office of Economic Opportunity, in cooperation with the U.S. Department of Labor, Bureau of
Labor Statistics.
A-3
Below is the list of the industrial and business parks operating within the City.
INDUSTRIAL AND BUSINESS PARKS
City of Chandler, Arizona
Source:
The City’s Economic Development Division.
[Remainder of page intentionally left blank]
10 Chandler
Chandler Hamilton Plaza
Park Place
Advanced Medical Plaza
Chandler Office Center
Parkside Professional Plaza
Airpark South Professional Village
Chandler Office Park
Presidio
Aquila Ocotillo
Chandler Technology Center
Price Road Industrial Park
Arizona Corporate Park North
Chandler Viridian
Price Warner Medical Office
Arizona Corporate Park South
Continuum Business Park
Promenade Commons
Ascend at Chandler Airport Center
Dobson Business Park
Regency Office Park
AZ202
Dobson Professional Plaza
San Tan Corporate Center I & II
Bogle Business Park
Eastpoint Business Plaza
San Tan Crossing Professional Plaza
Carmel Professional Plaza
Fairview Corporate Park
San Tan Technology Center
Chandler Airpark
First Chandler Business Park
Southgate Park
Chandler Airport Business Center
Focus Corporate Plaza
Southpark Business Center
Chandler Airport Commerce Center
Fountains at Ocotillo
Stellar Industrial Airpark
Chandler Center
Frye Road Industrial Park
The Park at Santan
Chandler Corporate Centers
Gila Springs Industrial Park
Tiburon
Chandler Crossroads
Kyrene 202 Business Park
Warner Commerce Park
Chandler Distribution Center
Lotus Project
Watermark
Chandler Echelon
Mach One
Westech Corporate Center
Chandler Freeway Business Park
Mammoth Professional Building
Williams Field Road Business Park
Chandler Freeway Crossings
McClintock Professional Plaza
Willis/AZ Ave Corporate
Chandler Gateway Medical Plaza
Paloma Kyrene Business Park
Chandler Gateway Office Park
Park Germann
A-4
Employment and Employers
Electronics plants located in the City include: Microchip Technologies, producer of electronic circuitry; Rogers
Corporation, manufacturer of materials for printed circuit boards and power electronic devices; Intel Corporation,
manufacturer of microcomputer components; and NXP, manufacturer of semiconductor and satellite systems.
A partial list of major manufacturing employers located within the City is set forth in the following table.
MAJOR MANUFACTURING EMPLOYERS (a)
City of Chandler, Arizona
__________________
(a) Some of the major manufacturing employers are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), and in accordance therewith file reports, proxy
statements and other information (collectively, the “Filings”) with the Commission. Such Filings may be inspected
and copies are available at the public reference facilities maintained by the Commission at 100 F Street, N.E.,
Washington, D.C. 20549. In addition, the Filings may also be inspected at the offices of the New York Stock
Exchange (“NYSE”) at 20 Broad Street, New York, New York 10005. The Filings may also be obtained through
the internet on the Commission’s EDGAR database at http://www.sec.gov. Neither the City, nor the Financial
Advisor or their respective agents or consultants have examined the information set forth in the Filings for accuracy
or completeness, nor do they assume responsibility for the same.
Source: The City's Economic Development Division.
Employer
Description
Employees
Intel Corporation
Microprocessors
12,000
NXP
Semiconductors/Satellite Systems
1,700
Northrop Grumman
Aerospace Launch Systems
2,150
Microchip Technology
Microprocessors
1,500
Arizona Nutritional Supplements
Vitamin Manufacturing and R&D
700
Rogers Corp. (including Headquarters)
Microwave Substrates
460
Ultra Clean Technology
Frame and Sheet Metal Fabrication
320
TEL - Tokyo Electron
Semiconductors
250
Smurfit Kappa
Paper Based Packaging
220
Comfort Systems USA
HVAC and Building Systems
265
Garmin
Navagation Systems
165
Advanced Circuits
PCB Manufacturer
150
Air Products and Chemicals, Inc.
Industrial Gas Manufacturing
150
Z Modular
Modular Construction Systems
150
Infineon Technologies Americas Corp
Semiconductors
140
Marvell Technologies
Semiconductors
135
CoValence Laboratories
Contract Manufacturer
130
Armorworks
Defense and Security Manufacturer
125
South Bay Circuits
Circuit Boards
125
Isola
Circuit Board Materials
115
A-5
The City also serves as the location of a significant number of non-manufacturing employers. The following is a partial
list of major non-manufacturing employers in the City.
MAJOR NON-MANUFACTURING EMPLOYERS (a)
City of Chandler, Arizona
(a) Some of the major non-manufacturing employers are subject to the informational requirements of the Exchange
Act, and in accordance therewith file the Filings with the Commission. The Filings may be inspected and copies
are available at the public reference facilities maintained by the Commission. In addition, the Filings may also be
inspected at the offices of the NYSE or on the Commission’s EDGAR database. Neither the City, nor the Financial
Advisor or their respective agents or consultants have examined the information set forth in the Filings for accuracy
or completeness, nor do they assume responsibility for the same.
Source: The City's Economic Development Division.
Approximate
Number of Full
Employer
Description
Time Employees
Wells Fargo Ocotillo Corporate Campus
Regional Corporate Headquarters
5,500
Chandler Unified School District
Public Education
4,900
Bank of America
Mortgage Processing Center
3,600
Chandler Regional Medical Center
Hospital
2,500
PayPal
E-Commerce Business
1,700
City of Chandler
Government
1,586
Verizon
Wireless Customer Support
1,400
Avnet
Computer Products Distribution
1,100
Basha's
Corporate HQ/Food Distribution
1,100
Liberty Mutual Insurance
Financial Services Center
1,000
GM IT Innovation Center
Software Development
890
GM Financial Services
Auto Financial Services
820
CVS Health
Retail Pharmaceutical Healthcare Products
700
Toyota Financial Services
Financial Services Center
700
Safelite Auto Glass
Auto Glass Repair and Replacement
700
Mr. Cooper
Mortgage Processing Center
600
Pearson Educational Institution
Educational Services
500
Allstate Insurance Co.
Financial Services Center
500
A-6
Agriculture
Agricultural production still is a contributor to the diversified economic base of the City. Principal products include
livestock, alfalfa, small grains, citrus and vegetables. As the residential, commercial and industrial development of the
City has occurred, the contribution of agricultural production to the economy of the City has decreased.
Commerce
A 13 million square foot super-regional shopping mall known as Chandler Fashion Center opened for business in 2001.
This mall is home to two anchor department stores, including Dillard’s, Macy’s, a 20-screen Harkins theater complex
and outdoor urban village and more than 180 specialty retail shops. Additionally, the Downtown Chandler
entertainment and business district serves as a hub for commercial activities due to numerous retail, restaurant and
entertainment venues. Several community shopping centers serve residents of the City and surrounding areas, including
Chandler Pavilions, Casa Paloma, Chandler Festival, Chandler Gateway, Paseo Del Oro Shopping Center, North Park
Plaza Shopping Center, Fulton Ranch Towne Center and Crossroads Towne Center. A number of neighborhood
shopping centers are also dispersed throughout the City.
Tourism
The direct, indirect and induced benefits derived from the activities surrounding tourism contribute greatly to the
economic health of the community. With 33 hotels representing more than 4,000 available rooms and three hotels under
construction which will provide an additional 510 rooms, the City’s tourism market continues to receive significant
private sector investment in new properties and the repositioning of older properties to meet the needs of leisure and
business travelers.
Leisure travel to the City is driven by proximity to various shopping, dining, recreational, sporting and scenic attractions
located within a short drive. However, business travel comprises most of the City’s visitors due to the high density of
employment. As the City is home to a number of Fortune 500 companies with global, regional and local headquarters
spanning several industry clusters (autonomous vehicle, high-tech manufacturing, semiconductor manufacturing,
aerospace, aviation, healthcare and bioscience, advanced business and financial business services, etc.), business
travelers drive the City’s lodging market.
Transportation
Industry, business and residents benefit from the transportation network available in and near the City. Rail, bus,
highway and air facilities are developed throughout the area.
The City is served by the Union Pacific Railroad for long distance freight rail service and the Valley Metro Transit
System for local public transportation.
The City is served by a network of streets and highways. The Superstition Freeway (“U.S. Highway 60”) parallels the
northern border of the City. U.S. Highway 60 connects to cities in northern and eastern Arizona. The Superstition
Freeway also connects to Interstate Highway 10 which connects the cities of Tucson and Phoenix. State Highway 87
and Arizona Loop 202 bisect the City. The Price Freeway (a north-south portion of Loop 101) and the San Tan Freeway
(an east-west portion of Loop 202) facilitate traffic flow to the City by connecting together the 101, 202 and I-10
freeways.
Residents of the area have ready access to Chandler Municipal Airport, Stellar Airpark, Phoenix-Mesa Gateway Airport
and Sky Harbor International Airport. The Chandler Municipal Airport, owned and operated by the City, is located
approximately three miles southeast of the central business district of the City and is designed to relieve private aircraft
activity at Sky Harbor International Airport. The Chandler Municipal Airport has approximately 430 based aircraft and
two parallel runways, 4,870 feet and 4,401 feet, respectively. The Chandler Municipal Airport offers various services
including full-service maintenance facilities, flight schools, and aircraft hangars. The Stellar Airpark is a private airport
that is open to public use and is located west of the central business district of the City. The Stellar Airpark has a 4,000
foot runway and provides various services. The Phoenix-Mesa Gateway Airport is owned and operated by the Williams
Gateway Airport Authority that includes the City of Mesa, City of Phoenix, Town of Gilbert, Town of Queen Creek,
A-7
the Gila River Indian Community and the City of Apache Junction. The Phoenix-Mesa Gateway Airport has three
expansive runways (10,401 feet; 10,201 feet; and 9,300 feet), a passenger terminal, and convenient parking. Phoenix-
Mesa Gateway Airport is positioned to be a dynamic reliever airport to Phoenix’s Sky Harbor International Airport.
Phoenix Sky Harbor International Airport is located 15 miles to the northwest of the City.
Education
Arizona State University (“ASU”) is the largest public university in the Southwest by enrollment. ASU spans five
campuses in the metro Phoenix area and has an enrollment of approximately 119,951 students including ASU online
programs. ASU’s main campus remains in the bordering City of Tempe, Arizona and is home to the Ira A. Fulton
Schools of Engineering, a nationally recognized research and innovation institution designed to meet the growing needs
of the engineering and technology industries. Adjacent to Phoenix-Mesa Gateway Airport, the Polytechnic Campus
serves approximately 5,243 students. Chandler is home to the ASU Chandler Innovation Center where ASU provides
technology-based education and operates a community makerspace. The University of Arizona’s Chandler campus is
housed in the City’s community center, where it offers a number of tech-focused undergraduate and graduate level
degrees, a professional MBA, and graduate programs in education, school psychology, and legal studies. Located in
the City is the Chandler-Gilbert Community College, which offers a complete educational program and serves nearly
20,000 students. The Chandler Unified School District provides primary and secondary education to residents in the
City area through 32 elementary schools, 9 middle school programs, 6 high schools and 4 alternative schools. A number
of private and charter schools are also located in the City.
B-1
APPENDIX B
CITY OF CHANDLER, ARIZONA - FINANCIAL DATA
2021/22 Fiscal Year –Estimated Net Full Cash and Assessed Values
Estimated Net Full Cash Value (a)(b)
$40,751,143,934
Net Assessed Limited Property Value (b)
3,463,794,661
Net Assessed Full Cash Value (b)
4,682,558,944
(a) Estimated Net Full Cash Value is the total market value of the property, less unsecured personal property and less
estimated exempt property within the City, as projected by the Arizona Department of Revenue, Division of
Property and Special Taxes.
(b) See “PROPERTY TAXES” herein for an explanation of these values.
Source:
State and County Abstract of the Assessment Roll, Arizona Department of Revenue and Property Tax Rates
and Assessed Values, Arizona Tax Research Association and the City.
[Remainder of page intentionally left blank]
B-2
STATEMENTS OF BONDS OUTSTANDING
General Obligation Bonds Outstanding and to be Outstanding
Issue
Series
Original
Amount
Maturity
Dates
Outstanding
Balance
Outstanding
2014REF
$214,540,000
7-1-22/26,28
$ 135,690,000
2016REF
39,050,000
7-1-25/27
39,050,000
2017
58,740,000
7-1-22/32
39,040,000
2019
30,400,000
7-1-22/35
29,400,000
Total General Obligation Bonds Outstanding
$ 243,180,000
Less: The Bonds Being Refunded by the Series 2021 GO Refunding Bonds
(43,320,000)*
Plus: The Series 2021 GO Refunding Bonds
48,610,000 *
Plus: The Series 2021 GO Bonds
33,375,000*
Less: Water and Wastewater Funds Supported General Obligation Bonds (a)
(67,855,000)
Net General Obligation Bonds Outstanding and to be Outstanding
$ 213,990,000 *
.
(a) The City intends to pay the debt service requirements of the following general obligation bonds with funds provided
by the Water and Wastewater Funds of the City: $53,861,000 aggregate principal amount of the City’s General
Obligation Refunding Bonds, Series 2014 and $13,550,000 aggregate principal amount of the City’s General
Obligation Refunding Bonds, Series 2016 and $18,730,000* aggregate principal amount of the City’s General
Obligation Refunding Bond, Taxable Series 2021. In the event that revenues available for payment of such annual
debt service requirements from the respective enterprise funds proves to be insufficient, or the City elects not to
pay debt service requirements on such general obligation bonds from the Water and Wastewater Funds, the debt
service requirements of such bonds will become payable from the annual levy of an ad valorem tax upon all of the
taxable property located within the City.
[Remainder of page intentionally left blank]
* Preliminary, subject to change.
B-3
Water and Wastewater Revenue Bonds Outstanding (a)
Balance
Outstanding*
Total Water and Wastewater Revenue Bonds Outstanding
$ -0-
Plus: Water and Wastewater Funds Supported General Obligation Bonds (b)
49,125,000*
Plus: Water and Wastewater Funds Supported Excise Revenue Tax Obligations (c)
122,095,000*
Plus: the Series 2021 GO Refunding Bonds
18,730,000*
Plus: the Series 2021 Refunding Obligations (d)
95,265,000*
Total Water and Wastewater Supported Bonds Outstanding
$ 285,215,000*
(a) Excludes the debt service requirements for the City’s refunded and defeased bonds currently outstanding which are
secured by obligations issued by the United States Government being held in their respective irrevocable trust
accounts.
(b) Net of the Series 2021 GO Refunding Bonds. The City intends to pay the debt service requirements of the Water
and Wastewater Funds Supported General Obligation Bonds with funds provided by the Water and Wastewater
Funds of the City. In the event that revenues available for payment of such annual debt service requirements from
the respective enterprise funds proves to be insufficient, or the City elects not to pay debt service requirements on
such general obligation bonds from the Water and Wastewater Funds, the debt service requirements of such bonds
will become payable from the annual levy of an ad valorem tax upon all of the taxable property located within the
City.
(c) Net of the Series 2021 Refunding Obligations. The City intends to pay the debt service requirements of the
following obligations with funds provided by the Water and Wastewater Funds of the City: $905,000 aggregate
principal amount of the City’s Excise Tax Revenue Obligations, Series 2011, $90,800,000 aggregate principal
amount of the City’s Excise Tax Revenue Obligations, Series 2013, $55,835,000 aggregate principal amount of the
City’s Excise Tax Revenue Obligations, Series 2015, $17,140,000 aggregate principal amount of the City’s Excise
Tax Revenue Series 2016 Refunding Obligations, Series 2016, the $33,420,000 aggregate principal amount of the
City’s Excise Tax Revenue Obligations, Series 2017, $11,050,000 aggregate principal amount of the City’s Excise
Tax Revenue Obligations, Series 2019 and the Series 2021 Refunding Obligations (together, the “Water and
Wastewater Funds Supported Excise Tax Revenue Obligations”).
(d) The City intends to pay a portion of the debt service requirements of the Series 2021 Refunding Obligations with
funds provided by the Water and Wastewater Funds of the City.
[Remainder of page intentionally left blank]
B-4
Excise Tax Revenue Obligations Outstanding and to be Outstanding
Issue
Series
Purpose
Original
Principal
Amount
Original
Principal
Maturity
Dates
Principal
Balance
Outstanding
2011
Various Projects
$15,000,000
07-01-12/22
$ 905,000
2013
Various Projects
104,500,000
07-01-15/33
90,800,000
2015
Various Projects
66,660,000
07-01-17/35
55,835,000
2016
Refunding
19,510,000
07-01-20/28
17,140,000
2017
Various Projects
36,220,000
07-01-18/37
33,420,000
2019
Various Projects
13,000,000
07-01-20/28
11,050,000
Total Excise Tax Revenue Obligations Outstanding
$209,150,000
Less: Obligations Being Refunded
(87,055,000)*
Plus: The Series 2021 Refunding Obligations
95,265,000 *
Less: Water and Wastewater Funds Supported General Obligations (a)
(217,360,000)*
Net Excise Tax Revenue Obligations Outstanding and to be Outstanding
$-
(a) The City intends to pay the debt service requirements of the Water and Wastewater Funds Supported Excise Tax
Revenue Obligations with funds provided by the Water and Wastewater Funds of the City.
Improvement District Bonds Outstanding
Issue
Series
Purpose
Original
Principal
Amount
Original
Principal
Maturity
Dates
Principal
Balance
Outstanding
2011A
$ 1,245,000
$7,370,000
01-01-09/23
$ 1,245,000
Total Improvement District Bonds Outstanding
$ 1,245,000
[Remainder of page intentionally left blank]
* Preliminary, subject to change.
B-5
Direct General Obligation Bonded Debt, Legal Limitation and Unused Borrowing Capacity
The Arizona Constitution provides that the general obligation bonded indebtedness for a city for general municipal
purposes may not exceed six percent (6%) of the net assessed full cash property valuation of the taxable property in that
city. In addition to the six percent (6%) limitation for general municipal purpose bonds, cities may issue general
obligation bonds in an amount up to an additional twenty percent (20%) of the net assessed full cash property valuation
for supplying such city with water, artificial light or sewers, and for the acquisition and development of land for open
space preserves, parks, playgrounds and recreational facilities, public safety, law enforcement, fire and emergency
services facilities and streets and transportation facilities.
*
(a) Includes the Series 2021 GO Refunding Bonds that the City intends to issue concurrently with the Series 2021
Refunding Obligations under a separate official statement. Also includes the Series 2021 GO Bonds that the City
intends to issue concurrently with the Series 2021 Refunding Obligations and the Series 2021 GO Refunding
Bonds under a separate official statement. See “STATEMENTS OF BONDS OUTSTANDING – General
Obligation Bonds Outstanding and to be Outstanding.”
(b)
This amount reduces the City’s borrowing capacity pursuant to State statutes and the Arizona Constitution, and
the principal amount of bonds authorized. Such capacity (but not authorization) will be recaptured as premium is
amortized.
[Remainder of page intentionally left blank]
* Preliminary, subject to change.
General Municipal Purpose Bonds
Park, Street, and Transportation Bonds
Total 6% General Obligation
$ 280,953,537
Total 20% General Obligation
$ 936,511,789
Bonding Capacity
Bonding Capacity
Less: 6% General Obligation
Less: 20% General Obligation
Bonds Outstanding
(5,851,900) *(a)
Bonds Outstanding
(237,328,100) *(a)
Less: Original Issue Premium
*(b)
Less: Original Issue Premium
*(b)
Less: Unamortized Original Issue Premium
(239,656) (b)
Less: Unamortized Original Issue Premium
(11,493,592) (b)
Net 6% General Obligation
Net 20% General Obligation
Bonding Capacity
$ 274,861,981
Bonding Capacity
$ 687,690,097
Water, Light, Sewer, Open Space, Public Safety,
Law Enforcement, Fire and Emergency Services,
B-6
Direct and Overlapping General Obligation Bonded Debt Outstanding-
Overlapping
Proportion Applicable to
General
City of Chandler (a)
Obligation
Approximate
Net Debt
Overlapping Jurisdiction
Bonded Debt (b)
Percent
Amount
State of Arizona
None
4.668%
None
Maricopa County (c)
None
7.109%
None
Maricopa County Community College District (d)
$ 250,065,000
7.109%
$ 17,777,103
Maricopa County Special Health Care District
429,125,000
7.109%
30,506,465
Kyrene Elementary School District No. 28
182,955,000
28.962%
52,987,566
Mesa Unified School District No. 4
275,525,000
4.458%
12,283,607
Gilbert Unified School District No. 41
112,360,000
2.736%
3,074,527
Chandler Unified School District No. 80
385,946,000
75.352%
290,816,740
Tempe Union High School District No. 213
76,755,000
16.630%
12,764,727
East Valley Institute of Technology District No. 401
None
14.434%
None
City of Chandler (e)
311,350,000*
100.000%
311,350,000
Total Direct and Overlapping General Obligation Bonded Debt to be Outstanding
$ 764,935,736
___________________
(a)
Proportion applicable to the City is computed on the ratio of 2020-21 net assessed limited property value for the
overlapping jurisdiction within the City to the total net limited assessed property valuation of the overlapping
jurisdiction.
Does not include the obligation of the Central Arizona Water Conservation District (“CAWCD”) to the United
States of America, Department of the Interior, for repayment of certain capital costs for construction of the Central
Arizona Project (“CAP”), a major reclamation project that has been substantially completed by the Department of
the Interior. The obligation is evidenced by a master contract between CAWCD and the Department of the Interior.
In April of 2003, the United States and CAWCD agreed to settle litigation over the amount of the construction
cost repayment obligation, the amount of the respective obligations for payment of the operation, maintenance and
replacement costs and the application of certain revenues and credits against such obligations and costs. Under
the agreement, CAWCD’s obligation for substantially all of the CAP features that have been constructed so far
will be set at $1.646 billion, which amount assumes (but does not mandate) that the United States will acquire a
total of 667,724 acre feet of CAP water for federal purposes. The United States will complete unfinished CAP
construction work related to the water supply system and regulatory storage stages of CAP at no additional cost
to CAWCD. Of the $1.646 billion repayment obligation, 73% will be interest bearing and the remaining 27% will
be non-interest bearing. These percentages are fixed for the entire 50-year repayment period, which commenced
October l, 1993. CAWCD is a multi-county water conservation district having boundaries coterminous with the
exterior boundaries of Maricopa, Pima and Pinal Counties. It was formed for the express purpose of paying
administrative costs and expenses of the CAP and to assist in the repayment to the United States of the CAP capital
costs. Repayment will be made from a combination of power revenues, subcontract revenues (i.e., agreements
with municipal, industrial and agricultural water users for delivery of CAP water) and a tax levy against all taxable
property within CAWCD’s boundaries. At the date of this Official Statement, the tax levy is fourteen cents per
$100 of net limited assessed property valuation, the maximum levy permitted by statute. (See Arizona Revised
Statutes, Sections 48-3715 and 48-3715.02.) There can be no assurance that such levy limit will not be increased
or removed at any time during the life of the contract.
Does not include the obligation of the Maricopa County Flood Control District to contribute $70 to $80 million
to the CAP. The Maricopa County Flood Control District’s sole source of revenue to pay the contribution will
be ad valorem taxes on real property and improvements.
*
*
B-7
(b)
Includes total general obligation bonds outstanding, less estimated funds irrevocably pledged for the redemption
of general obligations. Does not include presently authorized but unissued general obligation bonds of such
jurisdictions listed herein, which may be issued in the future. Authorized but unissued amounts in the following
table may be subject to additional reductions based on net premium amounts but such reductions are not reflected
in the table. Additional bonds may also be authorized by voters within overlapping jurisdictions pursuant to future
elections.
General Obligation Bonds
Overlapping Jurisdiction
Authorized but Unissued
State of Arizona
None
Maricopa County
None
Maricopa County Community College District
$ 3,000
Maricopa County Special Health Care District
None
Chandler Unified School District No. 80
95,250,000
Tempe Union High School District No. 213
None
Kyrene Elementary School District No. 28
52,450,000
Mesa Unified School District No. 4
95,000,000
Gilbert Unified School District No. 41
108,000,000
East Valley Institute of Technology District No. 401
None
City of Chandler (f)
150,180,000
(c) Does not include Maricopa County certificates of participation. Does not include Maricopa County Public Finance
Corporation lease revenue bonds outstanding. Does not include Maricopa County Stadium District revenue bonds
outstanding. Does not include Maricopa County Stadium District revenue bonds outstanding. Does not include the
obligations of the Maricopa County Flood Control District to contribute $70 to $80 million to the CAP. The
Maricopa County Flood Control District’s sole source of revenue to pay the contribution will be ad valorem taxes
on real property and improvements.
(d) Does not include Maricopa County Community College District revenue bonds outstanding.
(e) Does not include $1,245,000 City improvement district bonds outstanding.
(f) On May 27,2021 the City Council adopted a resolution calling for a special bond election requesting voter
consideration of $272,685,000 in general obligation bonds.
B-8
Direct and Overlapping General Obligation Bonded Debt Ratios
Per Capita
Bonded Debt
Population
Estimated @
272,011
As % of
City’s Total
2020/21
Net Full
Cash Value
As % of
City’s
2020/21
Estimated Net
Full Cash Value
Net Direct General Obligation Bonded Debt
Outstanding and to be Outstanding* (a)
$1,267.32
7.36%
0.85%
Net Direct and Overlapping General Obligation Bonded
Debt Outstanding and to be Outstanding (a)
$2,812.15
16.34%
1.88%
(a)
Includes the Series 2021 GO Refunding Bonds.
Source: The Arizona Department of Economic Security, Research Administration Population and Statistical Unit and
U.S. Census Bureau, Arizona Department of Administration.
Direct and Overlapping Tax Rates per $100 Assessed Value
Inside the City, East Valley Institute of Technology and:
Tax
Rate
Gilbert Unified School District No. 41
$11.2481
Mesa Unified School District No. 4
$12.3597
Tempe Union High School District No. 213 and Kyrene Elementary School District No. 28
$11.2712
Chandler Unified School District No. 28
$11.4012
Source:
Property Tax Rates and Assessed Values, Arizona Tax Research Association.
Expenditure Limitation; One-Year and Multi-Year Overrides
Since fiscal year 1982-83, all cities in Arizona have been subject to an annual expenditure limitation imposed by the
Arizona Constitution. This limitation is based upon the City’s actual 1979-80 expenditures adjusted annually for
subsequent growth in population and inflation. The Constitution exempts certain expenditures from the limitation. The
principal exemptions for the City are payments for debt service on bonds and other long-term obligations, as well as
expenditures of federal funds and certain state-shared revenues.
The Constitution provides four processes, all requiring voter approval, for cities to modify the expenditure limitation:
1. A four-year home rule option.
2. A permanent adjustment to the 1979-80 base.
3. A one-time override for the following fiscal year.
4. An accumulation for pay-as-you-go capital expenditures.
* Preliminary, subject to change.
B-9
City voters have approved four-year home rule options on a regular basis since the implementation of the expenditure
limitation. To the extent that the home rule option is not approved by the voters, the City would be subject to the
expenditure limitations prescribed by the Constitution. On August 28, 2018, the City’s voters approved a four-year
home rule option to exceed the expenditure limitation by the City beginning in Fiscal Year 2019-20. This four-year
home rule option will be in effect through fiscal year 2022-23.
City Retirement Systems Update
All full-time employees of the City, the Mayor and City Council participate in one of the three pension plans
administered by the State described below. See Note 10 in APPENDIX D for further discussion of the retirement plans
of the City.
The Government Accounting Standards Board adopted GASB Statement Number 68, Accounting and Financial
Reporting for Pensions (“GASB 68”), which, beginning with fiscal years starting after June 15, 2014, requires cost-
sharing employers to report their “proportionate share” of the plan’s net pension liability in their government-wide
financial statements. GASB 68 will also require that the cost-sharing employer’s pension expense component include
its proportionate share of the plan’s pension expense, the net effect of annual changes in the employer’s proportionate
share and the annual differences between the employer’s actual contributions and its proportionate share.
Arizona State Retirement System
All full-time City employees (except public safety personnel and elected officials) participate in the Arizona State
Retirement System (the “System”), a multiple-employer cost-sharing defined benefit pension plan. The System was
established in 1953 and became effective in 1971. The System provides for retirement, disability, health insurance
premium benefits, and death and survivor benefits. The System is administered in accordance with A.R.S. Title 38,
Chapter 5.
The actuarially determined contribution rates for the fiscal year 2020/21 were 12.22% (12.04% retirement and 0.18%
long-term disability) for both employees and employers. The City’s contribution to the System for the fiscal year
2020/21 was $9,762,864 equal to the required contributions, not including alternate contributions.
Effective July 1, 2021, the City’s annual contribution rates are 12.41% (12.22% retirement and 0.19% long-term
disability) for fiscal year 2021/22 for both employees and employers.
The System has reported increases in its unfunded liabilities as compared to both the smoothed value of plan assets and
the market value of plan assets. The most recent annual reports for the System may be accessed at:
https://www.azasrs.gov. The effect of the increase in the System’s unfunded liabilities on the City, or on the City’s and
its employees’ future annual contributions to the System, cannot be determined at this time.
Arizona Public Safety Personnel Retirement System (Full-Time Police and Firefighter Employees)
All full-time sworn police officers and firefighters are eligible to participate in the Public Safety Personnel Retirement
System (the “PSPRS”) in separate agent multiple-employer defined benefit retirement plans. The PSPRS is jointly
administered by the fund manager (a five-member board appointed by the Governor and the State Legislature) and 257
local boards. The PSPRS provides for retirement, health insurance premium benefits, and death and survivor benefits.
The PSPRS is administered in accordance with A.R.S. Title 38, Chapter 5, Article 4.
The actuarially determined contribution rates for the fiscal year ended June 30, 2021 were 49.12% of annual covered
payroll for police tiers 1 and 2, 44.22% for tier 3 defined benefit (DB) and 44.51% for tier 3 defined contribution (DC).
For firefighters the contribution rate was 43.84% for tiers 1 and 2, 41.25% for tier 3 DB and 37.90 for tier 3 DC. The
City’s employer contribution to the PSPRS for the fiscal year ended June 30, 2021 was $13,017,877 for police and
$7,993,728 for firefighters, equal to the required contributions, not including alternate contributions.
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Effective July 1, 2021, the City’s annual contribution rates are 7.65% for both groups of employees in tier 1, 11.65%
for both groups in tier 2, 10.12% for Police tier 3 DB, 9.88% for Police DC, 13.76% for Fire DB and 10.41% for Fire
DC. The rates are as follows for employers:
Tier 1 Contribution Rate
Hired into a PSPRS position before January 1, 2012:
Police: 49.12%
Fire: 41.67%
Tier 2 Contribution Rate
Hired into a PSPRS position on/after January 1, 2012 and before July 1, 2017:
Police: 49.12%
Fire: 41.67%
Tier 3 Contribution Rate
Hired into a PSPRS position on/after July 1, 2017:
Defined Benefit:
Police: 45.46%
Fire: 39.78%
Defined Contribution:
Police: 45.22%
Fire: 35.90%
The PSPRS has reported overall increases in its unfunded liabilities as compared to both the smoothed value of plan
assets and the market value of plan assets. The City of Chandlers portions increased only slightly for Fire but decreased
for Police due to the increased overpayments which have been made. The most recent annual reports for the PSPRS
may be accessed at: http://www.psprs.com/investments--financials/annual-reports. The effect of the increase in the
PSPRS’s unfunded liabilities on the City, or on the City’s and its employees’ future annual contributions to the PSPRS,
is $56,672,244 for fire and $114,467,812 for police as of the June 30, 2020 Actuarial Reports prepared by Foster &
Foster, Actuaries and Consultants. City Council has approved a compressed pay down plan in order to pay off the
unfunded liability.
Elected Officials’ Retirement Plan (Mayor and City Council)
The Mayor and Council of the City participate in two different plans: The Elected Officials’ Retirement Plan (EORP)
for councilmembers elected prior to 2014 and the Elected Officials’ Defined Contribution Retirement System
(EODCRS) for Council members elected effective January 1, 2014, both multiple-employer cost-sharing defined benefit
plans. The administrator for the EORP and the EODCRS is also the fund manager of the PSPRS. The EORP and
EODCRS provides for retirement, health insurance premium benefits, and death and survivor benefits.
The actuarially determined contribution rate for the fiscal year ended June 30, 2021 was 61.43%. The City’s
contribution to the EORP and EODCRS for the fiscal year ended June 30, 2021 was $154,160, equal to the required
contributions, not including alternate contributions.
Effective July 1, 2021, the City’s annual contribution rate for EORP is 61.43% for employer and either 7% or 13% for
employees (depending on their membership date), and the City’s annual contribution rate for EODCRS is 61.555% for
employer and 8.125% for employees.
The EORP has reported increases in its unfunded liabilities as compared to both the smoothed value of plan assets and
the market value of plan assets. The most recent annual reports for the EORP may be accessed at:
http://www.psprs.com/investments--financials/annual-reports. The estimated effect of the increase in the EORP’s
unfunded liabilities on the City, or on the City’s and its employees’ future annual contributions to the EORP, is
$2,047,312 as of the June 30, 2020 EORP schedule of pension amounts by employer.
Healthcare Benefits for Retired Employees
During the year ended June 30, 2018, the City implemented the provisions of GASB Statement No. 75, Accounting and
Financial Reporting for Postemployment Benefits Other Than Pensions (“GASB 75”). The City is required to report the
actuarially accrued cost of post-employment benefits, other than pension benefits (“OPEB”), such as health and life
insurance for current and future retirees. GASB 75 addresses reporting by governments that provide OPEB by
B-11
measuring and recognizing net assets or liabilities, deferred outflows of resources, deferred inflows of resources, and
expenses/expenditures related to OPEB provided through defined benefit OPEB plans. See Note 1 in APPENDIX D –
“CITY OF CHANDLER, ARIZONA – AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30,
2020” for further information.
The City’s employees, their spouses and survivors may be eligible for certain retiree healthcare benefits under healthcare
programs provided by the City. Employees on long-term disability and their spouses may also qualify for retiree
healthcare benefits through the City. It is expected that substantially all City employees that reach normal or early
retirement age while working for the City will become eligible for such benefits. Currently, such retirees may obtain
the healthcare benefits offered by the City by paying 100% of the applicable premium. Although the retirees pay 100%
of their premium, the retirees’ participation in the City’s healthcare program affects the City’s healthcare costs for its
employees and results in an implicit rate subsidy.
The City provides other post-employment benefits to its retirees that consist of an implicit subsidy for healthcare and a
retirement health savings (RHS) plan for reimbursement of eligible medical expenses. The City offers the RHS plan to
employees and contributes toward a savings plan for each employee that they are eligible to use for medical expense
reimbursement at separation from service. The City makes no contribution to the retirees' premiums other than allowing
them to participate through the City's pooled benefits. By providing retirees with access to the City's healthcare plans
based on the same rates it charges to active employees, the City is in effect providing an implicit subsidy to retirees. This
implicit subsidy exists because, on average, retiree healthcare costs are higher than active employee healthcare
costs. Because the City does not contribute anything toward this plan in advance, the City employs a pay -as-you-go
method through paying the higher rate for active employees each year.
The City’s net OPEB liability as of June 30, 2020 is $53,112,727 and is reflected on the Balance Sheet in the City's
Financial Statements. This is calculated based on the annual required contribution (ARC) of the employer, an amount
actuarially determined which represents a level of funding that is paid on an ongoing basis, and projected to cover
normal cost each year to amortize the unfunded actuarial liability over a period not to exceed thirty years.
[Remainder of page intentionally left blank]
B-12
PROPERTY TAXES
Notwithstanding the following discussion of property taxes, the obligation of the City to make the Payments with respect
to the Series 2021 Refunding Obligations does not constitute an obligation to pledge any form of ad valorem taxes. See
“SECURITY AND SOURCES OF PAYMENT”.
For tax purposes in Arizona, real property and improvements and personal property is either valued by the Maricopa
County Assessor (the “Assessor of the County”) or the Arizona Department of Revenue. Property valued by the
Assessor of the County is referred to as “locally assessed” property and generally encompasses residential, agricultural
and traditional commercial and industrial property. Property valued by the Arizona Department of Revenue is referred
to as “centrally valued” property and is generally large mine and utility entities.
Locally assessed property has two different values, Limited Property Value and Full Cash Value (both as defined below).
Limited Property Value is used as the basis for taxation. Full Cash Value is used as the ceiling for determining Limited
Property Value and for determining debt limits for certain local governmental entities including for school districts.
For centrally valued property and personal property (except mobile homes), Full Cash Value of the property is the basis
for taxation of such property and for determining constitutional and statutory debt limits for most local governmental
entities.
“Limited Property Value” means, for property in existence in the prior year, the lesser of (a) the Full Cash Value of the
property or (b) an amount 5% greater than the Limited Property Value of such property determined for the prior year.
Limited Property Value is established at a level or percentage of Full Cash Value comparable to properties of the same
or similar use or classification for property erroneously totally or partially omitted from the property tax rolls in the
prior year; property for which a change in use occurred; property modified by construction, destruction, or demolition
since the preceding valuation year such that the total value of the modification is equal to or greater than 15% of the
Full Cash Value; and property that has been split, subdivided or consolidated, with variations depending on when the
change occurred. There is no limit on the growth of Full Cash Value.
Primary Taxes
Taxes levied for the maintenance and operation of counties, cities, towns, school districts, community college districts
and the State are “primary taxes”. These taxes are levied against the Net Assessed Limited Property Value (as defined
below) of the taxing jurisdiction. “Net Assessed Limited Property Value” is determined by excluding the value of
property exempt from taxation from the Limited Property Value of locally assessed property and from Full Cash Value
of centrally valued property and combining the resulting two amounts.
The State does not currently levy ad valorem taxes but the State currently requires each county to levy a “State
equalization assistance property tax” to provide equalization assistance to school districts in each county, which is used
to offset the cost of State equalization to those school districts.
The primary taxes levied by a county, city, town and community college district are constitutionally limited to a
maximum increase of 2% over the maximum allowable prior year’s levy limit plus any taxes on property not subject to
tax in the preceding year (e.g., new construction and property brought into the jurisdiction because of annexation). The
2% limitation does not apply to primary taxes levied on behalf of school districts.
Primary taxes on residential property only are constitutionally limited to 1% of the Limited Property Value of such
property. This constitutional limitation on residential primary tax levies is implemented by reducing the school districts’
taxes. To offset the effects of reduced school district property taxes, the State compensates the school districts by
providing additional state aid or, in some counties, county taxpayers are required to make payments to offset the effects
of reduced property taxes.
B-13
Secondary Taxes
Taxes levied for debt retirement (e.g., debt service on the City’s bonds), voter-approved budget overrides and
maintenance and operation of special service districts such as sanitary, fire, road improvement and career technical
education districts are “secondary taxes”. Like primary taxes, secondary taxes also are levied against the Net Assessed
Limited Property Value of the taxing jurisdiction. There is no limitation on annual levies for voter-approved bond
indebtedness and certain special district assessments. Pursuant to a statutory change effective in 2018, school districts
subject to desegregation orders levy secondary property taxes in addition to secondary taxes levied for debt service or
budget overrides.
Assessment Ratios
All property, both real and personal, is assigned a classification to determine its assessed valuation for tax purposes.
Each legal classification is defined by property use and has an assessment ratio (a percentage factor) that is multiplied
by the taxable value of the property -- Limited Property Value or Full Cash Value, as applicable -- to obtain the
“Assessed Limited Property Value” or the “Full Cash Assessed Value,” respectively. The assessment ratios for each
class of property are set forth by tax year in the table below.
PROPERTY TAX ASSESSMENT RATIOS
Tax Year 2017 through Tax Year 2021
Tax Year
Property Classification (a)
2017
2018
2019
2020
2021
Mining, utilities, commercial and industrial
18%
18%
18%
18%
18%
Agriculture and vacant land
15
15
15
15
15
Owner occupied residential
10
10
10
10
10
Leased or rented residential
10
10
10
10
10
Railroad, private car company and airline
flight property (b)
15
14
15
15
15
(a) Additional property classifications exist, but seldom amount to a significant portion of a municipal body’s total
valuation.
(b) This percentage is determined annually pursuant to Section 42-15005, Arizona Revised Statutes.
Source:
State and County Abstract of the Assessment Roll, Arizona Department of Revenue.
Tax Procedures
The Arizona tax year is defined as the calendar year, although tax procedures begin prior to January 1 of the prior fiscal
year and continue through May of such fiscal year, when payment of the second installment of property taxes for the
tax year becomes delinquent.
The first step in the tax process is the determination of the Full Cash Value of each parcel of real property within the
State. “Full Cash Value” is statutorily defined to mean “the value determined as prescribed by statute” or if a statutory
method is not prescribed it is “synonymous with market value.” “Market Value” means that estimate of value that is
derived annually by use of standard appraisal methods and techniques, which generally includes the market approach,
the cost approach and the income approach. As a general matter, the various county assessors use a cost approach for
commercial/industrial property and a market approach for residential property. Arizona law allows taxpayers to appeal
the county assessor’s valuations by providing evidence of a lower value, which may be based upon another valuation
approach.
In valuing centrally valued property, the Arizona Department of Revenue begins generally with information provided
by taxpayers and then applies procedures provided by State law. Appeals are also allowed for such valuations.
B-14
On or before the third Monday in August of each year, the Board of Supervisors of the County prepares the tax roll that
sets forth the valuation by taxing district of all property in the County subject to taxation. The Assessor of the County
is required to complete the assessment roll by December 15th of the year prior to the levy. This tax roll also shows the
valuation and classification of each parcel of land located within the County for the tax year. The tax roll is then
forwarded to the Treasurer of the County. With the various budgetary procedures having been completed by the
governmental entities, the appropriate tax rate for each jurisdiction is then applied to the parcel of property in order to
determine the total tax owed by each property owner. Any subsequent decrease in the value of the tax roll as it existed
on the date of the levy due to appeals or other reasons would reduce the amount of taxes received by each jurisdiction.
The property tax lien on real property attaches on January 1 of the fiscal year the tax is levied. Such lien is prior and
superior to all other liens and encumbrances on the property subject to such tax except liens or encumbrances held by
the State or liens for taxes accruing in any other years.
In the event the County is expressly enjoined or prohibited by law from collecting taxes due from any taxpayer, such as
may result from the bankruptcy of a taxpayer, any resulting deficiency could be collected in subsequent tax years by
adjusting the City’s tax rate charged to non-bankrupt taxpayers during such subsequent tax years.
Delinquent Tax Procedures
The property taxes due to the City are billed, along with State and other taxes, in September of the calendar tax year and
are due and payable in two installments on October 1 and March 1 and become delinquent on November 1 and May 1.
Delinquent taxes are subject to an interest penalty of 16% per annum prorated monthly as of the first day of the month.
(However, delinquent interest is waived if a taxpayer, delinquent as to the November 1 payment, pays the entire year’s
tax bill by December 31.) After the close of the tax collection period, the Assessor of the County prepares a delinquent
property tax list and the property so listed is subject to a tax lien sale in February of the succeeding year. In the event
there is no purchaser for the tax lien at the sale, the tax lien is assigned to the State, and the property is reoffered for sale
from time to time until such time as it is sold, subject to redemption, for an amount sufficient to cover all delinquent
taxes.
Three years after the sale of the tax lien, the tax lien certificate holder may bring an action in a court of compet ent
jurisdiction to foreclose the right of redemption and, if the delinquent taxes plus accrued interest are not paid by the
owner of record or any entity having a right to redeem, a judgment is entered ordering the Treasurer of the County to
deliver a treasurer’s deed to the certificate holder as prescribed by law.
It should be noted that in the event of a taxpayer filing for relief pursuant to the United States Bankruptcy Code (the
“Bankruptcy Code”), the law is currently unsettled as to whether a lien can be attached against the taxpayer’s property
for property taxes levied during the pending bankruptcy. Such taxes might constitute an unsecured and possibly non -
interest bearing administrative expense payable only to the extent that the secured creditors of a taxpayer are
oversecured, and then possibly only on the prorated basis with other allowed administrative claims. It cannot be
determined, therefore, what adverse impact bankruptcy might have on the ability to collect ad valorem taxes on property
of a taxpayer within the City. Proceeds to pay such taxes come only from the taxpayer or from a sale of the tax lien on
delinquent property.
It cannot be determined what impact any deterioration of the financial conditions of any taxpayer, whether or not
protection under the Bankruptcy Code is sought, may have on payment of or the secondary market for bonds issued by
the City. None of the City, the Financial Advisor or their respective attorneys, agents or consultants has undertaken any
independent investigation of the operations and financial condition of any taxpayer, nor have they assumed
responsibility for the same.
B-15
Real and Secured Property Taxes Levied and Collected (a)
__________________
(a) Taxes are certified and collected by the Treasurer of the County. Taxes in support of debt service are levied by the
Board of Supervisors of the County as required by Arizona Revised Statutes. Delinquent taxes are subject to an
interest and penalty charge of 16% per annum which is prorated at a monthly rate of 1.33%. Delinquent interest is
waived if a taxpayer, delinquent as to the November 1 payment pays the entire year’s tax bill by December 31.
Interest and penalty collections for delinquent taxes are not included in the collection figures above, but are
deposited in the County General Fund.
(b) The Tax Levy is adjusted downward in future years after the initial levy as a result of successful taxpayer appeals.
The Tax Levy, net of resolutions (as presented in the Maricopa County Treasurer’s Office report), is noted in this
presentation.
(c) In the process of collection.
SPECIAL NOTE: The assessed valuation of property owned by the Salt River Project Agricultural Improvement and
Power District (“SRP”) is not included in the assessed valuation of the City in the prior table or in any other valuation
information set forth in this Official Statement. Because of SRP’s quasi-governmental nature, property owned by SRP
is exempt from property taxation.
However, SRP may elect each year to make voluntary contributions in lieu of property taxes with respect to certain of
its electrical facilities (the “SRP Electric Plant”). If SRP elects to make the in lieu contribution for the year, the full cash
value of the SRP Electric Plant and the in lieu contribution amount is determined in the same manner as the full cash
value and property taxes owed is determined for similar non-governmental public utility property, with certain special
deductions.
If after electing to make the in lieu contribution, SRP then failed to make the in lieu contribution when due, the Treasurer
of the County and the City have no recourse against the property of SRP and the City.
Since 1964, when the in lieu contribution was originally authorized in State statute, SRP has never failed to make that
election. The fiscal year 2021-22 in lieu assessed valuation of SRP within the City is $43,273,000 which represents
approximately 1.25% of the combined Net Assessed Limited Property Value in the City. SRP’s total contribution in
lieu of property tax payments (primary & secondary) was $443,311 for fiscal year 2018-19 and $434,953 for 2019-20.
Source:
Treasurer of the County.
Collected to June 30 of
Cumulative Collection
Fiscal
Initial Fiscal Year
to June 30, 2021
Year
Tax Levy (b)
Amount
% of Levy
Amount
% of Levy
2020-21
36,379,535
$
36,041,018
$
99.07
36,041,018
$
99.07
2019-20
33,976,882
33,597,309
98.88
33,966,438
99.97
2018-19
32,097,385
31,714,236
98.81
31,891,123
99.36
2017-18
30,545,951
30,321,359
99.26
30,540,759
99.98
2016-17
29,471,064
27,952,666
94.85
29,466,097
99.98
%
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Direct and Overlapping Net Assessed Limited Property Value and Tax Rates
Per $100 Assessed Valuation
Overlapping Jurisdiction
2021-22
Net Assessed
Limited
Property Value
2020-21
Combined Primary
and Secondary Tax
Rates Per $100
Net Assessed Limited
Property Value
State of Arizona
$74,200,233,397
None
Maricopa County
48,724,126,672
$1.8435 (a)
Maricopa County Community College District
48,724,126,672
1.2881
Maricopa County Library District
48,724,126,672
0.0556
Maricopa County Flood Control District (b)
42,084,633,673
0.0090
Maricopa County Fire District Assistance Tax
48,724,126,672
0.1792
Maricopa County Special Health Care District
48,724,126,672
0.3046
Central Arizona Water Conservation District (c)
48,724,126,672
0.1400
East Valley Institute of Technology District No. 401(d)
23,998,252,082
0.0500
Chandler Unified School District No. 80
3,374,230,827
6.4111
Tempe Union High School District No. 213
4,201,600,213
2.4991
Kyrene Elementary School District No. 28
2,412,625,402
3.7820
Mesa Unified School District No. 4
3,544,450,333
7.3696
Gilbert Unified School District No. 41
2,356,761,360
6.2580
City of Chandler
3,463,794,661
1.1201
(a) Includes the State Equalization Assistance Property tax. This rate has been set at $0.4426 for fiscal year 2020-21
and is adjusted annually pursuant to Arizona Revised Statues, Section 41-1276.
(b) The assessed value of the Maricopa County Flood Control District does not include the personal property assessed
value of the County.
(c) Value shown for the Central Arizona Water Conservation District covers only the County portion of such district.
(d) Includes Net Assessed Limited Property Value for the East Valley Institute of Technology District No. 401 within
Pinal County.
Source:
Property Tax Rates and Assessed Values, Arizona Tax Research Foundation.
B-17
Property Value by Property Classification
Set forth below is a breakdown of the Net Full Cash Assessed Property Valuation of the City by property classification.
Class
2017-18
2018-19
2019-20
2020-21
2021-22
Commercial, industrial,
utilities and mines
$1,027,345,767
$ 1,102,515,089
$ 1,246,170,328
$ 1,412,928,374
$ 1,488,882,870
Agricultural and vacant
74,055,978
75,266,539
78,888,739
77,850,859
76,801,910
Residential (owner occupied)
1,472,336,279
1,574,405,659
1,681,112,768
1,837,472,779
1,990,237,285
Residential (rental)
574,699,601
646,538,541
738,411,405
847,104,454
946,787,996
Railroad
1,910,025
1,782,690
1,910,025
2,011,500
2,011,500
Historical property
156,435,042
88,612,464
124,084,500
130,572,188
177,317,246
Commercial historical property
-
-
-
-
-
Certain Government
property improvements
432,241
383,733
400,055
477,042
520,137
Totals (a)
$3,307,214,933
$3,489,504,715
$3,870,977,820
$4,308,417,196
$ 4,682,558,944
Source:
State and County Abstract of the Assessment Roll, Arizona Department of Revenue.
Net Assessed Limited Property Value of Major Taxpayers
Some of the major taxpayers, including Intel Corporation, NXP, Bank of America, NA, and Wells Fargo Bank NA are
subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
and in accordance therewith file the Filings with the Commission. The Filings may be inspected and copies are available
at the public reference facilities maintained by the Commission. In addition, the Filings may also be inspected at the
offices of the New York Stock Exchange at 20 Broad Street, New York, New York 10005. The Filings may also be
obtained through the Internet on the Commission’s EDGAR database at http://www.sec.gov. Neither the City, nor the
Financial Advisor or their respective agents or consultants has examined the information set forth in the Filings for
accuracy or completeness, nor do they assume responsibility for the same.
Source:
County Assessor’s Office.
As % of
City’s Total
2021-22
2021-22
Net Assessed Limited
Net Assessed Limited
Taxpayer (a)
Description
Property Value
Property Value
Intel Corporation
Manufacturing Plant
$168,730,977
4.87%
NXP USA Inc
Manufacturing Plant
10,177,870
0.29%
Oracle America Inc
Corporation Service Company
4,767,196
0.14%
Air Products & Chemicals Inc
Industrial Gas Manufacturing
4,591,588
0.13%
Dell Equipment Funding LP
Corporation Service Company
3,675,016
0.11%
Cox Communications Arizona LLC
Communications
3,047,562
0.09%
Microsoft Corporation
Corporate Sales Office
2,554,402
0.07%
Williams Scotsman Inc
Contracting
2,358,990
0.07%
Rogers Corporation
Microwave Substrates
2,329,784
0.07%
Wells Fargo Bank
Financial Services
2,104,110
0.06%
Total
$204,337,495
5.90%
Total City Net Assessed Limited Property Value
$3,463,794,661
B-18
Property Values
The tables below list the various property values for the City for fiscal year 2017-18 through 2021-22. All values herein
are net of the estimated value of property exempt from taxation.
Property Values for Fiscal Year 2017-18 through 2021-22
Fiscal
Year
Net Assessed
Limited
Property Value
Net Full Cash
Assessed Value
Estimated Net
Full Cash Value (a)
2021-22
$ 3,463,794,661
$ 4,682,558,944
$ 40,751,143,934
2020-21
3,243,434,243
4,308,417,196
36,949,424,457
2019-20
3,011,152,689
3,870,977,820
33,312,389,044
2018-19
2,783,830,922
3,489,504,715
29,847,787,490
2017-18
2,675,480,112
3,307,214,933
28,994,678,811
_______________________
(a)
Estimated Net Full Cash Value is the total estimated “market value” of taxable property, which is calculated
by multiplying the Full Cash Value by the ratio of Net Assessed Full Cash Value divided by the Assessed Full
Cash Value. Each value as reported by the Assessor of the County in the State Abstract.
Source:
State and County Abstract of the Assessment Roll, Arizona Department of Revenue.
Net Assessed Limited Property Value and Net Full Cash Assessed Value Comparisons and Trends
The tables below are shown to indicate for fiscal year 2016-17 through 2020-21, the (i) Net Assessed Limited Property
Values and (ii) Net Full Cash Values, of the City, the County and the State of Arizona, each on a comparative basis.
Comparative Net Assessed Limited Property Value Histories
Fiscal
Year
City of
Chandler
Percent
Increase/
(Decrease)
Maricopa
County
Percent
Increase/
(Decrease)
State of
Arizona
Percent
Increase/
(Decrease)
2021-22
$3,463,794,661
6.79%
$48,724,126,672
6.61%
$74,200,233,397
6.13%
2020-21
3,243,434,243
7.71
45,704,969,813
5.81
69,914,763,468
5.68
2019-20
3,011,152,689
8.17
43,194,326,395
6.86
66,154,632,834
6.14
2018-19
2,783,830,922
4.05
40,423,232,421
5.72
62,328,357,186
4.92
2017-18
2,675,480,112
4.76
38,236,246,402
5.63
59,404,007,785
2.10
__________________
Source:
Property Tax Rates and Assessed Values, Arizona Tax Research Association and Abstract and Assessment
Roll, State of Arizona Department of Revenue.
Comparative Net Full Cash Value Histories
Fiscal
Year
City of
Chandler
Percent
Increase/
(Decrease)
Maricopa
County
Percent
Increase/
(Decrease)
State of
Arizona
Percent
Increase/
(Decrease)
2021-22
$4,682,558,944
8.68%
$67,535,008,138
9.24%
N/A
N/A
2020-21
4,308,417,196
11.30
61,824,712,434
9.25
N/A
N/A
2019-20
3,870,977,820
10.93
56,588,192,576
8.94
N/A
N/A
2018-19
3,489,504,715
5.51
51,944,549,119
7.45
N/A
N/A
2017-18
3,307,214,933
4.42
48,343,820,221
7.69
N/A
N/A
__________________
Source:
Abstract and Assessment Roll, State of Arizona Department of Revenue.
C-1
APPENDIX C
FORM OF OPINION OF SPECIAL COUNSEL
__________, 2021
Mayor and City Council
City of Chandler, Arizona
U.S. Bank National Association,
as Trustee
Ladies and Gentlemen:
We have examined the proceedings relating to the execution and delivery by U.S. Bank National
Association (the “Trustee”) of $[__________] aggregate principal amount of City of Chandler, Arizona, Excise Tax
Revenue Refunding Obligations, Taxable Series 2021 (the “2021 Obligations”) dated [_________], 2021, pursuant to
a Trust Agreement dated as of [__________] 1, 2021 (the “Trust Agreement”), between the Trustee and the City of
Chandler, Arizona (the “City”). Each of the 2021 Obligations represents a participating interest in obligations of the
City under a purchase agreement dated as of [_______] 1, 2021 (the “Agreement”), between the Trustee and the City,
including certain payments (the “Payments”) and all other amounts due and payable by the City under the Agreement
over the period from the date hereof to July 1, 20__, under which the Trustee has contracted to cause the redemption in
advance of maturity of the City’s outstanding City of Chandler, Arizona Excise Tax Revenue Obligations, Series 2011
and City of Chandler, Arizona Excise Tax Revenue Obligations, Series 2013 (collectively, the “Obligations Being
Refunded”). The Payments under the Agreement are secured by certain excise tax revenues pledged by the City pursuant
to the Agreement and the Trust Agreement. We have also examined a form of the 2021 Obligations.
Based upon such examination, we are of the opinion that, under the law existing on the date of this
opinion:
1.
The 2021 Obligations, Trust Agreement and Agreement are legal, valid, binding and
enforceable in accordance with their respective terms, except that the binding effect and enforceability thereof are
subject to applicable bankruptcy, insolvency, reorganization, moratorium and other laws in effect from time to time
affecting the rights of creditors generally, and except to the extent that the enforceability thereof may be limited by the
application of general principles of equity.
2.
The Payments and obligations of the City under the Agreement and the 2021 Obligations are
payable from and are secured by a pledge of and lien on the Excise Taxes (as defined in the Agreement), as provided in
the Agreement and the Trust Agreement. The Agreement and the Trust Agreement create the first lien on the Excise
Taxes they purport to create. The rights of the owners of the 2021 Obligations to payment from the Payments secured
by the Excise Taxes shall be on a parity with the rights to payment from such Excise Taxes of the holders of the Existing
Parity Obligations and any Additional Parity Obligations (both as defined in the Trus t Agreement). Additional
obligations may be issued in the future on a parity with the 2021 Obligations with respect to the lien on Excise Taxes.
3.
Interest income on the 2021 Obligations is subject to federal income taxes. We express no
opinion regarding other federal tax consequences arising with respect to the 2021 Obligations.
4.
Under existing laws, regulations, rulings and judicial decisions, the portion of each Payment
made by the City under the Agreement and denominated as and comprising interest pursuant to the Agreement and
received by the owners of the 2021 Obligations is exempt from Arizona income taxes.
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As to questions of fact material to our opinion, we have relied upon, and assumed due and continuing
compliance with the provisions of, the proceedings and other documents, and have relied upon certificates, covenants
and representations furnished to us without undertaking to verify the same by independent investigation.
GUST ROSENFELD P.L.C.
Timothy A. Stratton
For the Firm
4043420
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APPENDIX D
SUMMARIES OF SELECT PROVISIONS OF PRINCIPAL DOCUMENTS
[To be provided by Special Counsel]
E-1
APPENDIX E
CITY OF CHANDLER, ARIZONA
AUDITED FINANCIAL STATEMENTS OF THE CITY OF CHANDLER, ARIZONA
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
The following audited financial statements are for the fiscal year ended June 30, 2020. These are the most recent audited
financial statements available to the City. These audited financial statements may not represent the current financial
conditions of the City. The City did not request the consent of Heinfeld, Meech & Co., P.C. to include its report and
Heinfeld, Meech & Co., P.C. has performed no procedures subsequent to rendering its opinion on the audited financial
statements.
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APPENDIX F
BOOK-ENTRY-ONLY SYSTEM
The description set forth below of the procedures and record-keeping with respect to beneficial ownership interests in
the Series 2021 Refunding Obligations, payment of principal of and interest on the Series 2021 Refunding Obligations
to Direct Participants, Indirect Participants and Beneficial Owners (as hereinafter defined), and other information
concerning DTC and the book-entry-only system of registration and transfer of beneficial ownership interests in the
Series 2021 Refunding Obligations is based solely on information furnished by DTC to the City for inclusion in this
Official Statement. None of the City, the Trustee or the Financial Advisor makes any representations as to the accuracy
or completeness thereof.
DTC will act as securities depository for the Series 2021 Refunding Obligations. The Series 2021 Refunding Obligations
will be issued as fully-registered securities in the name of Cede & Co. (DTC’s partnership nominee) or such other name
as may be requested by an authorized representative of DTC. One fully-registered Obligation will be issued for each
maturity thereof, each in the aggregate principal amount of such maturity and the Series 2021 Refunding Obligations
will be deposited with DTC.
DTC, the world’s largest depository, 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 and provides
asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and
money market instruments from over 100 countries that DTC’s participants (“Direct Participants”) deposit with DTC.
DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in
deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’
accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both
U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other
organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC,
in turn, is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing
Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries.
Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers,
banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of “AA+.” The
DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information
about DTC can be found at www.dtcc.com.
Purchases of the Series 2021 Refunding Obligations under the DTC system must be made by or through Direct
Participants, which will receive a credit for the Series 2021 Refunding Obligations on DTC’s records. The ownership
interest of each actual purchaser of each 2015 Obligation (“Beneficial Owner”) is in turn to be recorded on the Direct
and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase.
Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well
as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner
entered into the transaction. Transfers of ownership interests in the Series 2021 Refunding Obligations are to be
accomplished by entries made on the books of the Direct and Indirect Participants acting on behalf of Beneficial Owners .
Beneficial Owners will not receive certificates representing their ownership interest in the Series 2021 Refunding
Obligations, except in the event that use of the book-entry system for the Series 2021 Refunding Obligations is
discontinued.
To facilitate subsequent transfers, all Obligations deposited by Direct Participants with DTC are registered in the name
of DTC’s partnership nominee, Cede & Co. or such other name as may be requested by an authorized representative of
DTC. The deposit of the Series 2021 Refunding Obligations with DTC and their registration in the name of Cede &
Co. or such other DTC nominee do not affect any change in beneficial ownership. DTC has no knowledge of the actual
Beneficial Owners of the Series 2021 Refunding Obligations; DTC’s records reflect only the identity of the Direct
Participants to whose accounts such Obligations are credited, which may or may not be the Beneficial Owners. The
F-2
Direct Participants and Indirect Participants will remain responsible for keeping account of their holdings on behalf of
their customers.
Conveyances 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. Beneficial
Owners of Obligations may wish to take certain steps to augment the transmission to them of notices of significant
events with respect to the Series 2021 Refunding Obligations, such as prepayments, tenders, defaults, and proposed
amendments to the Agreement and the Trust Agreement. For example, Beneficial Owners of Obligations may wish to
ascertain that the nominee holding the Series 2021 Refunding Obligations for their benefit has agreed to obtain and
transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and
addresses to the Trustee and request that copies of notices be provided directly to them.
Redemption notices will be sent to DTC. If less than all of the Series 2021 Refunding Obligations within a maturity are
being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such
maturity to be redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the Series 2021
Refunding Obligations unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its
usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus
Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts the Series 2021
Refunding Obligations are credited on the record date (identified in a listing attached to the Omnibus Proxy).
Redemption proceeds, distributions and payments on the Series 2021 Refunding Obligations will be made to Cede &
Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit
Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the City or the
Trustee, on payment dates in accordance with their respective holdings shown on DTC’s records. Payments by Direct
and Indirect 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 Direct or Indirect Participant and not of DTC, the Trustee or the City, subject to any statutory or
regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions and
principal and interest payments to Cede & Co. (or such other nominee as may be requested by an authorized
representative of DTC) is the responsibility of the City or the Trustee, disbursement of such payments to Direct
Participants will be the responsibility of DTC and disbursement of such payments to the Beneficial Owners will be the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as depository with respect to the Series 2021 Refunding Obligations at any
time by giving reasonable notice to the City or the Trustee. Under such circumstances, in the event that a successor
depository is not obtained, the Series 2021 Refunding Obligations are required to be printed and delivered to the
respective Beneficial Owners.
The use of the system of book-entry transfers through DTC (or a successor securities depository) may also be
discontinued by the City. In that event, the Series 2021 Refunding Obligations will be printed and delivered.
The foregoing description of the procedures and recordkeeping with respect to beneficial ownership interest in the Series
2021 Refunding Obligations, payment of principal and interest on the Series 2021 Refunding Obligations to DTC
Participants or Beneficial Owners, confirmation and transfers of the beneficial ownership interests in the Series 2021
Refunding Obligations and other related transactions by and between DTC, the DTC Participants and Beneficial Owners
are based solely on the City’s understanding of such procedures and recordkeeping, which is based solely on information
provided by DTC. Accordingly, no representations can be made by the City or the Financial Advisor concerning these
matters and neither the DTC Participants nor the Beneficial Owners should rely on the foregoing information with
respect to such matters, but should instead confirm the same with DTC or the DTC Participants, as the case may be.
NONE OF THE CITY, THE TRUSTEE OR THE FINANCIAL ADVISOR HAVE ANY RESPONSIBILITY OR
OBLIGATION TO DIRECT PARTICIPANTS, TO INDIRECT PARTICIPANTS OR TO ANY BENEFICIA L
OWNER WITH RESPECT TO (I) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC, ANY DIRECT
F-3
PARTICIPANT, OR ANY INDIRECT PARTICIPANT; (II) THE PAYMENT BY DTC OR ANY DIRECT
PARTICIPANT OR INDIRECT PARTICIPANT OF ANY AMOUNT WITH RESPECT TO THE PRINCIPAL OF,
PREMIUM, IF ANY, OR INTEREST
ON THE SERIES
2021 REFUNDING
OBLIGATIONS;
(III) THE
TRANSMITTAL BY DIRECT PARTICIPANTS OR INDIRECT PARTICIPANTS OF ANY NOTICE WHICH IS
PERMITTED OR REQUIRED TO BE GIVEN TO HOLDERS OF THE SERIES 2021 REFUNDING OBLIGATIONS;
(IV) ANY CONSENT GIVEN BY DTC OR OTHER ACTION TAKEN BY DTC AS HOLDER OF THE SERIES
2021 REFUNDING OBLIGATIONS; OR (V) THE SELECTION BY DTC OR ANY DIRECT PARTICIPANT OR
INDIRECT PARTICIPANT OF ANY BENEFICIAL OWNERS TO RECEIVE PAYMENT IN THE EVENT OF A
PARTIAL REDEMPTION OF THE SERIES 2021 REFUNDING OBLIGATIONS.
4044305.1
1
APPENDIX G
$95,265,000*
CITY OF CHANDLER, ARIZONA
EXCISE TAX REVENUE REFUNDING OBLIGATIONS,
SERIES 2021
CONTINUING DISCLOSURE CERTIFICATE
(CUSIP No. 158855)
This Continuing Disclosure Certificate (the “Disclosure Certificate”) is undertaken by the City of Chandler,
Arizona, an Arizona political subdivision (the “City”) in connection with the execution and delivery of the City’s
$__________ principal amount of Excise Tax Revenue Refunding Obligations, Series 2021 (the “Obligations”). In
consideration of the initial sale and delivery of the Obligations, the City covenants as follows:
Section 1.
Purpose of the Disclosure Certificate. This Disclosure Certificate is for the benefit of the
Obligation Holders (as defined herein) and in order to assist the Participating Underwriter (as defined herein) in
complying with the Rule (as defined herein).
Section 2.
Definitions. Any capitalized term used herein shall have the following meanings, unless
otherwise defined herein:
“Annual Report” shall mean the annual report provided by the City pursuant to, and as described in, Sections
3 and 4 of this Disclosure Certificate.
“Audited Financial Statements” shall mean the City’s annual financial statements, which are currently
prepared in accordance with generally accepted accounting principles (GAAP) for governmental units as prescribed
by the Governmental Accounting Standards Board (GASB) and which the City intends to con tinue to prepare in
substantially the same form.
“Dissemination Agent” shall mean the City or any person designated in writing by the City as the
Dissemination Agent.
“EMMA” shall mean the Electronic Municipal Market Access system of MSRB, or any successor thereto
approved by the United States Securities and Exchange Commission, as a repository for municipal continuing
disclosure information pursuant to the Rule.
“Financial Obligation” shall mean (i) a debt obligation; (ii) a derivative instrument entered into in connection
with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) a guarantee of
(i) or (ii), except that “Financial Obligation” does not include municipal securities as to which a final official statement
has been provided to the MSRB.
“Listed Events” shall mean any of the events listed in Section 5 of this Disclosure Certificate.
“MSRB” shall mean the Municipal Securities Rulemaking Board, or any successor thereto.
“Obligation Holder” shall mean any registered owner or beneficial owner of the Obligations.
“Official Statement” shall mean the final official statement dated ________, 2021 relating to the Obligations.
* Preliminary, subject to change.
4044305.1
2
“Participating Underwriter” shall mean any of the original underwriters of the Obligations required to
comply with the Rule in connection with offering of the Obligations.
“Rule” shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as the same may be amended from time to time.
“Special Counsel” shall mean Gust Rosenfeld P.L.C. or such other nationally recognized Special Counsel as
may be selected by the City.
Section 3.
Provision of Annual Reports.
(a)
Commencing February 1, 2022, and by no later than February 1 of each year thereafter (the “Filing
Date”), the City shall, either directly or by directing the Dissemination Agent to do so, provide an Annual Report to
MSRB. The Annual Report shall be provided electronically and in a format prescribed by the MSRB. The Annual
Report shall be consistent with the requirements of Section 4 of this Disclosure Certificate and shall include
information from the fiscal year ending on the preceding June 30. All documents provided to MSRB shall be
accompanied by identifying information prescribed by MSRB. Currently, filings are required to be made with EMMA.
Not later than 15 business days prior to such Filing Date, the City shall provide the Annual Report to the Dissemination
Agent (if other than the City).
(b)
If the City is unable or for any reason fails to provide electronically to EMMA an Annual Report or
any part thereof by the Filing Date required in subsection (a) above, the City shall in a timely manner, send a notice
to EMMA in substantially the form attached as Exhibit A not later than the Filing Date.
(c)
If the City’s Audited Financial Statements are not submitted with the Annual Report and the City
fails to provide to EMMA a copy of its Audited Financial Statements within 30 days of receipt thereof by the City,
then the City shall, in a timely manner, send a notice to EMMA in substantially the form attached as Exhibit B.
(d)
The Dissemination Agent shall:
(i)
Determine the proper electronic filing address of EMMA each year prior to the date(s) for
providing the Annual Report and Audited Financial Statements; and
(ii)
If the Dissemination Agent is other than the City, file a report or reports with the City certifying
that the Annual Report and Audited Financial Statements, if applicable, have been provided pursuant to this Disclosure
Certificate, stating the date such information was provided and listing where it was provided.
Section 4.
Content of Annual Reports.
(a)
The Annual Report may be submitted as a single document or as separate documents comprising an
electronic package, and may incorporate by reference other information as provided in this Section, including the
Audited Financial Statements of the City; provided, however, that if the Audited Financial Statements of the City are
not available at the time of the filing of the Annual Report, the City shall file unaudited financial statements of the
City with the Annual Report and, when the Audited Financial Statements of the City are available, the same shall be
submitted to EMMA within 30 days of receipt thereof by the City.
(b)
The City’s Annual Report shall contain or incorporate by reference the following:
(i)
Type of Financial and Operating Data to be Provided:
(A)
Subject to the provisions of Sections 3 and 4(a) hereof, Audited Financial Statements
for the City.
(B)
Annually updated financial information and operating data of the type contained in
the subsection “Excise Taxes” in the Official Statement.
4044305.1
3
(C)
In the event of an amendment pursuant to Section 8 hereof not previously described
in an Annual Report, an explanation, in narrative form, of the reasons for the amendment and the impact of the change
in the type of operating data or financial information being provided and, if the amendment is made to the accounting
principles to be followed, a comparison between the financial statements or information prepared on the basis of the
new accounting principles and those prepared on the basis of the former accounting principles, including a qualitative
discussion of the differences, and the impact on the presentation and, to the extent feasible, a quantitative comparison.
(ii)
Accounting Principles Pursuant to Which Audited Financial Statements Shall Be Prepared:
The Audited Financial Statements shall be prepared in accordance with generally accepted accounting principles and
state law requirements as are in effect from time to time. A more complete description of the accounting principles
currently followed in the preparation of the City’s Audited Financial Statements is contained in Note 1 of the Audited
Financial Statements included within the Official Statement. Notice of amendment to the accounting principles shall
be sent within 30 days to EMMA.
(c)
Any or all of the items listed above may be incorporated by reference from other documents,
including official statements of debt issues of the City or related public entities, which have been submitted to EMMA
or the Securities and Exchange Commission. If the document incorporated by reference is a final official statement,
it must be available from EMMA. The City shall clearly identify each such other document so incorporated by
reference.
Section 5.
Reporting of Listed Events.
(a)
This Section shall govern the giving of notices by the City, either directly or by directing the
Dissemination Agent to do so, of the occurrence of any of the following events with respect to the Obligations. The
City shall in a timely manner, not in excess of 10 business days after the occurrence of the event, provide notice of
the following events with EMMA:
(i)
Principal and interest payment delinquencies;
(ii)
Non-payment related defaults, if material;
(iii)
Unscheduled draws on debt service reserves reflecting financial difficulties;
(iv)
Unscheduled draws on credit enhancements reflecting financial difficulties;
(v)
Substitution of credit or liquidity providers, or their failure to perform;
(vi)
Adverse tax opinions, the issuance by the Internal Revenue Service (the “IRS”) of proposed
or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the Obligations, or other
material events affecting the tax status of the Obligations;
(vii)
Modifications to rights of Obligation Holders, if material;
(viii)
Bond calls, if material, and tender offers;
(ix)
Defeasances;
(x)
Release, substitution, or sale of property securing repayment of the Obligations, if material;
(xi)
Rating changes;
(xii)
Bankruptcy, insolvency, receivership or similar event of the City;
(xiii)
The consummation of a merger, consolidation, or acquisition involving the City or the sale of
all or substantially all of the assets of the City, other than in the ordinary course of business,
the entry into a definitive agreement to undertake such an action or the termination of a
definitive agreement relating to any such actions, other than pursuant to its terms, if material;
(xiv)
Appointment of a successor or additional trustee or the change of name of a trustee, if material;
(xv)
The incurrence of a Financial Obligation of the City, if material, or agreement to covenants,
events of default, remedies, priority rights, or other similar terms of a Financial Obligation of
the City, any of which affect Obligation Holders, if material; and
(xvi)
A default, event of acceleration, termination event, modification of terms, or other similar
events under the terms of a Financial Obligation of the City, any of which reflect financial
difficulties.
(b)
“Materiality” will be determined in accordance with the applicable federal securities laws.
4044305.1
4
Note to Section 5(a)(xii): For the purposes of the event identified in subsection (a)(xii) above, the event is
considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for
the City in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in
which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the
City, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in
possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order
confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority havin g
supervision or jurisdiction over substantially all of the assets or business of the City.
Section 6.
Termination of Reporting Obligation. The City’s obligations under this Disclosure
Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Obligations.
Such termination shall not terminate the obligation of the City to give notice of such defeasance or prior redemption.
Section 7.
Dissemination Agent. From time to time, the City may appoint or engage a Dissemination
Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Agent,
with or without appointing a successor Dissemination Agent.
Section 8.
Amendment. Notwithstanding any other provision of this Disclosure Certificate, the City
may amend this Disclosure Certificate if:
(a)
The amendment is made in connection with a change in circumstances that arises from a change in
legal requirements, change in law, or change in identity, nature or status of the City, or the type of business conducted;
(b)
This Disclosure Certificate, as amended, would, in the opinion of Special Counsel, have complied
with the requirements of the Rule at the time of the primary offering of the Obligations, after taking into account any
amendments or interpretations of the Rule, as well as any change in circumstances; and
(c)
The amendment does not materially impair the interests of Obligation holders, as determined by
Special Counsel.
Section 9.
Filing with EMMA. The City shall, or shall cause the Dissemination Agent to, electronically
file all items required to be filed with the MSRB in a format prescribed by the MSRB. Currently, filings are required
to be made with EMMA.
Section 10.
Additional Information. If the City chooses to include any information in any Annual
Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure
Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it
in any future Annual Report or notice of occurrence of a Listed Event.
Section 11.
Default. In the event of a failure of the City to comply with any provision of this Disclosure
Certificate any Obligation Holder may seek specific performance by court order to cause the City to comply with its
obligations under this Disclosure Certificate. The sole remedy under this Disclosure Certificate in the event of any
failure of the City to comply with this Disclosure Certificate shall be an action to compel performance and such failure
shall not constitute a default under the Obligations or the resolution authorizing the Obligations.
Section 12.
Compliance by the City. The City hereby covenants to comply with the terms of this
Disclosure Certificate. The City expressly acknowledges and agrees that compliance with the undertaking contained
in this Disclosure Certificate is its sole responsibility and the responsibility of the Dis semination Agent, if any, and
that such compliance, or monitoring thereof, is not the responsibility of, and no duty is present with respect thereto
for, the Participating Underwriter, Special Counsel or the City’s financial advisor.
Section 13.
Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the
Dissemination Agent, the Participating Underwriter and Obligation Holders, and shall create no rights in any other
person or entity.
4044305.1
5
Section 14.
Governing Law. This Disclosure Certificate shall be governed by the law of the State of
Arizona and any action to enforce this Disclosure Certificate must be brought in an Arizona state court. The terms
and provisions of this Disclosure Certificate shall be interpreted in a manner consistent with the interpretation of such
terms and provisions under the Rule and the federal securities law.
[Signatures on the following page]
4044305.1
Date:
________, 2021.
CITY OF CHANDLER, ARIZONA
________________________________________
Management Services Director
[Signature Page to Continuing Disclosure Certificate]
G-1
EXHIBIT A
NOTICE OF FAILURE TO FILE
Name of Issuer:
City of Chandler, Arizona
Name of Obligation Issue:
$__________ Excise Tax Revenue Refunding Obligations, Series 2021
Dated Date of Obligations:
_________, 2021
Base CUSIP: 158855
NOTICE IS HEREBY GIVEN that the City has not provided a Comprehensive Annual Financial Report with
respect to the above-named Obligations as required by Section 3(a) of the Disclosure Certificate dated _________, 2021.
The City anticipates that the Comprehensive Annual Financial Report will be filed by ___________.
Dated: _____________________
CITY OF CHANDLER, ARIZONA
By _______________________________________
Its _______________________________________
-------------------------------------------------------------------------------------------------------------------------------
EXHIBIT B
NOTICE OF FAILURE TO FILE AUDITED FINANCIAL STATEMENTS
Name of Issuer:
City of Chandler, Arizona
Name of Obligation Issue:
$__________ Excise Tax Revenue Refunding Obligations, Series 2021
Dated Date of Obligations:
_________, 2021
Base CUSIP: 158855
NOTICE IS HEREBY GIVEN that the City failed to provide its audited financial statements with its
Comprehensive Annual Financial Report or, if not available, within 30 days of receipt as required by Section 4(a) of the
Disclosure Certificate dated _________, 2021 with respect to the above-named Obligations. The City anticipates that
the audited financial statements for the fiscal year ended June 30, ____ will be filed by ________________.
Dated: ______________________
CITY OF CHANDLER, ARIZONA
By ______________________________________
Its ______________________________________
[Exhibits to Continuing Disclosure Certificate]