FY2016 TIF Report - Naperville

SECTION 2 [Sections 2 through 5 must be completed for each redevelopment project area listed in Section 1.]

FY 2016

Name of Redevelopment Project Area:

Primary Use of Redevelopment Project Area*:

If "Combination/Mixed" List Component Types:

No Yes

Were there any amendments to the redevelopment plan, the redevelopment project area, or the State

Sales Tax Boundary? [65 ILCS 5/11‐74.4‐5 (d) (1) and 5/11‐74.6‐22 (d) (1)]If yes, please enclose the amendment labeled Attachment A X

Certification of the Chief Executive Officer of the municipality that the municipality has complied with all

of the requirements of the Act during the preceding fiscal year. [65 ILCS 5/11‐74.4‐5 (d) (3) and 5/11‐74.6‐

22 (d) (3)]Please enclose the CEO Certification labeled Attachment B X

Opinion of legal counsel that municipality is in compliance with the Act. [65 ILCS 5/11‐74.4‐5 (d) (4) and

5/11‐74.6‐22 (d) (4)]Please enclose the Legal Counsel Opinion labeled Attachment C X

Were there any activities undertaken in furtherance of the objectives of the redevelopment plan,

including any project implemented in the preceding fiscal year and a description of the activities

undertaken? [65 ILCS 5/11‐74.4‐5 (d) (7) (A and B) and 5/11‐74.6‐22 (d) (7) (A and B)]If yes, please enclose the Activities Statement labeled Attachment D

X

Were any agreements entered into by the municipality with regard to the disposition or redevelopment

of any property within the redevelopment project area or the area within the State Sales Tax Boundary?

[65 ILCS 5/11‐74.4‐5 (d) (7) (C) and 5/11‐74.6‐22 (d) (7) (C)]If yes, please enclose the Agreement(s) labeled Attachment E X

Is there additional information on the use of all funds received under this Division and steps taken by the

municipality to achieve the objectives of the redevelopment plan? [65 ILCS 5/11‐74.4‐5 (d) (7) (D) and

5/11‐74.6‐22 (d) (7) (D)]If yes, please enclose the Additional Information labeled Attachment F X

Did the municipality's TIF advisors or consultants enter into contracts with entities or persons that have

received or are receiving payments financed by tax increment revenues produced by the same TIF? [65

ILCS 5/11‐74.4‐5 (d) (7) (E) and 5/11‐74.6‐22 (d) (7) (E)]If yes, please enclose the contract(s) or description of the contract(s) labeled Attachment G X

Were there any reports or meeting minutes submitted to the municipality by the joint review board? [65

ILCS 5/11‐74.4‐5 (d) (7) (F) and 5/11‐74.6‐22 (d) (7) (F)]If yes, please enclose the Joint Review Board Report labeled Attachment H X

Were any obligations issued by municipality? [65 ILCS 5/11‐74.4‐5 (d) (8) (A) and

5/11‐74.6‐22 (d) (8) (A)]If yes, please enclose the Official Statement labeled Attachment I X

Was analysis prepared by a financial advisor or underwriter setting forth the nature and term of

obligation and projected debt service including required reserves and debt coverage? [65 ILCS 5/11‐74.4‐

5 (d) (8) (B) and 5/11‐74.6‐22 (d) (8) (B)]If yes, please enclose the Analysis labeled Attachment J XCumulatively, have deposits from any source equal or greater than $100,000 been made into the specialtax allocation fund? 65 ILCS 5/11-74.4-5 (d) (2) and 5/11-74.6-22 (d) (2)If yes, please enclose Audited financial statements of the special tax allocation fundlabeled Attachment K XCumulatively, have deposits of incremental taxes revenue equal to or greater than $100,000 been madeinto the special tax allocation fund? [65 ILCS 5/11-74.4-5 (d) (9) and 5/11-74.6-22 (d) (9)]If yes, please enclose a certified letter statement reviewing compliance with the Act labeledAttachment L

XA list of all intergovernmental agreements in effect to which the municipality is a part, and an accounting of any money transferred or received by the municipality during that fiscal year pursuant to those intergovernmental agreements. [65 ILCS 5/11-74.4-5 (d) (10)]If yes, please enclose list only, not actual agreements labeled Attachment M X

* Types include: Central Business District, Retail, Other Commercial, Industrial, Residential, and Combination/Mixed.

Water Street TIF District

Combination/Mixed

Retail, Other Commercial

Under which section of the Illinois Municipal Code was Redevelopment Project Area designated? (check one):

Tax Increment Allocation Redevelopment Act __X__ Industrial Jobs Recovery Law _____

FY 2016

Fund Balance at Beginning of Reporting Period 4,136,907$

Revenue/Cash Receipts Deposited in Fund During Reporting FY: Reporting Year Cumulative* % of Total

Property Tax Increment 128,468$ 790,053$ 4%

State Sales Tax Increment 0%

Local Sales Tax Increment 0%

State Utility Tax Increment 0%

Local Utility Tax Increment 0%

Interest 44,694$ 95,608$ 1%

Land/Building Sale Proceeds 0%

Bond Proceeds 6,870,000$ 13,090,000$ 73%

Transfers from Municipal Sources 3,605,653$ 3,605,653$ 20%

Private Sources 0%

Other (Premium on sale of GO Bonds) 473,338$ 473,338$ 3%

Total Amount Deposited in Special Tax Allocation

Fund During Reporting Period 11,122,153$

Cumulative Total Revenues/Cash Receipts 18,054,652$ 100%

Total Expenditures/Cash Disbursements (Carried forward from Section 3.2) 10,097,272$

Distribution of Surplus

Total Expenditures/Disbursements 10,097,272$

NET INCOME/CASH RECEIPTS OVER/(UNDER) CASH DISBURSEMENTS 1,024,881$

FUND BALANCE, END OF REPORTING PERIOD* 5,161,788$

* if there is a positive fund balance at the end of the reporting period, you must complete Section 3.3

SURPLUS*/(DEFICIT)(Carried forward from Section 3.3) (6,163,865)$

SECTION 3.1 - (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5))

Provide an analysis of the special tax allocation fund.

*must be completed where current or prior year(s) have reported funds

TIF NAME: WATER STREET TIF DISTRICT

FY 2016

Amounts Reporting Fiscal Year

1. Costs of studies, administration and professional services—Subsections (q)(1) and (o) (1)

Annual Audit Fee - Sikich 2015 3,410

Annual Audit Fee - Sikich 2016 3,577

6,987$

2. Cost of marketing sites—Subsections (q)(1.6) and (o)(1.6)

-$

Title Services - Chicago Title 2015 443,129

443,129$

-$

Engineering Cost - Carl Walker - 2015 50,711

Construction Costs - 2015 7,315,884

Engineering Cost - Carl Walker - 2016 14,625

Construction Costs - 2016 2,130,026

9,511,246$

-$

3.Property assembly: property acquisition, building demolition, site preparation andenvironmental site improvement costs. Subsections (q)(2), (o)(2) and (o)(3)

4.Costs of rehabilitation, reconstruction, repair or remodeling of existing public or privatebuildings. Subsection (q)(3) and (o)(4)

5. Costs of construction of public works and improvements. Subsection (q)(4) and (o)(5)

6.Costs of removing contaminants required by environmental laws or rules (o)(6) - IndustrialJobs Recovery TIFs ONLY

SECTION 3.2 A- (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5))

Category of Permissible Redevelopment Cost [65 ILCS 5/11-74.4-3 (q) and 65 ILCS 5/11-74.6-10 (o)]

FOR AMOUNTS >$10,000 SECTION 3.2 B MUST BE COMPLETED

ITEMIZED LIST OF ALL EXPENDITURES FROM THE SPECIAL TAX ALLOCATION FUND

(by category of permissible redevelopment cost, amounts expended during reporting period)


-$

Debt Service - 2016 94,572

Issuance Costs - 2016 41,338

135,910$

-$

-$

-$

-$

-$

8.Financing costs related to obligations issued by the municipality. Subsection (q) (6) and (o)(8)

7. Cost of job training and retraining, including "welfare to work" programs Subsection (q)(5),(o)(7) and (o)(12)

PAGE 2

SECTION 3.2 A

9. Approved taxing district's capital costs. Subsection (q)(7) and (o)(9)

10. Cost of Reimbursing school districts for their increased costs caused by TIF assistedhousing projects. Subsection (q)(7.5) - Tax Increment Allocation Redevelopment TIFs ONLY

11. Relocation costs. Subsection (q)(8) and (o)(10)

12.Payments in lieu of taxes as defined in Subsections 11-74.43(m) and 11-74.6-10(k).Subsection (q)(9) and (o)(11)

13. Costs of job training, retraining advanced vocational or career education provided by othertaxing bodies. Subsection (q)(10) and (o)(12)

-$

-$

-$

10,097,272$

15. Costs of construction of new housing units for low income and very low-income households.Subsection (q)(11)(F) - Tax Increment Allocation Redevelopment TIFs ONLY

16. Cost of day care services and operational costs of day care centers. Subsection (q) (11.5) -Tax Increment Allocation Redevelopment TIFs ONLY

TOTAL ITEMIZED EXPENDITURES

14. Costs of reimbursing private developers for interest expenses incurred on approvedredevelopment projects. Subsection (q)(11)(A-E) and (o)(13)(A-E)

SECTION 3.2 A

PAGE 3

FY 2016

______ There were no vendors, including other municipal funds, paid in excess of $10,000 during the current reporting period.

Name Service Amount

Chicago Title and Trust Construction Escrow 9,445,910.00$

Chicago Title and Trust Title Services 443,129.00$

Carl Walker Engineering Services 65,336.00$

City of Naperville ‐ Debt Service Fund Principle and Interest 94,571.88$

City of Naperville ‐ Debt Service Fund Bond Issuance Costs 41,337.80$

List all vendors, including other municipal funds, that were paid in excess of $10,000 during the current reporting year.

Section 3.2 B


FY 2016

FUND BALANCE, END OF REPORTING PERIOD 5,161,788$

Amount of Original Issuance Amount Designated

1. Description of Debt Obligations

General Obligation 2014 Series 3,605,653$

General Obligation 2016 Series 6,870,000$

Total Amount Designated for Obligations ‐$ 10,475,653$

2. Description of Project Costs to be Paid

Riverwalk 200,000$

Stormwater Detention 550,000$

Water & Webster Street Reconstruction 100,000$

Total Amount Designated for Project Costs 850,000$

TOTAL AMOUNT DESIGNATED 11,325,653$

SURPLUS*/(DEFICIT) (6,163,865)$

* NOTE: If a surplus is calculated, the municipality may be required to repay the amount to overlapping taxing

SECTION 3.3 - (65 ILCS 5/11-74.4-5 (d) (5) 65 ILCS 11-74.6-22 (d) (5))

Breakdown of the Balance in the Special Tax Allocation Fund At the End of the Reporting Period


FY 2016

_____ No property was acquired by the Municipality Within the Redevelopment Project Area

Property Acquired by the Municipality Within the Redevelopment Project Area

Property (1):

Street address:

Approximate size or description of property:

Purchase price:

Seller of property:

Property (2):

Street address:


Purchase price:

Seller of property:

Property (3):

Street address:


Purchase price:

Seller of property:

Property (4):

Street address:


Purchase price:

Seller of property:

Provide a description of all property purchased by the municipality during the reporting fiscal year within theredevelopment project area.

SECTION 4 [65 ILCS 5/11-74.4-5 (d) (6) and 65 ILCS 5/11-74.6-22 (d) (6)]


FY 2016

Box below must be filled in with either a check or number of projects, not both______

1

TOTAL: 11/1/99 to Date

Estimated Investment for Subsequent Fiscal

YearTotal Estimated to Complete Project

Private Investment Undertaken (See Instructions) 70,929,632$ 9,514,474$ 80,444,106$

Public Investment Undertaken 17,681,278$ 850,000$ 18,531,278$

Ratio of Private/Public Investment 4 1/86 4 15/44

Project 1: *IF PROJECTS ARE LISTED NUMBER MUST BE ENTERED ABOVE

Private Investment Undertaken (See Instructions) 70,929,632$ 9,514,474$ 80,444,106$

Public Investment Undertaken 17,681,278$ 850,000$ 18,531,278$

Ratio of Private/Public Investment 4 1/86 4 15/44

Project 2:

Private Investment Undertaken (See Instructions)

Public Investment Undertaken

Ratio of Private/Public Investment 0 0

Project 3:




Project 4:




Project 5:




Project 6:




SECTION 5 - 65 ILCS 5/11-74.4-5 (d) (7) (G) and 65 ILCS 5/11-74.6-22 (d) (7) (G)PAGE 1

*Page 1 is to be included with TIF Report. Pages 2-3 are to be included ONLY if projects are listed.

ENTER total number of projects undertaken by the Municipality Within the Redevelopment Project Area and list them in detail below*.

Check if NO projects were undertaken by the Municipality Within the Redevelopment Project Area:


SECTION 6

FY 2016

Provide the base EAV (at the time of designation) and the EAV for the year reported for the redevelopment project areaYear redevelopment

project area was designated Base EAV

Reporting Fiscal Year EAV

2007 1,876,420$ 2,599,120$

SECTION 7

Provide information about job creation and retention

Number of Jobs Retained

Number of Jobs Created

Description and Type (Temporary or

Permanent) of Jobs Total Salaries Paid

156 41

156 Temp Construction;

41 Permanent Hotel &

Retail Jobs $47,595,093

‐$

‐$

‐$

‐$

‐$

‐$

SECTION 8

Provide a general description of the redevelopment project area using only major boundaries:

Optional Documents Enclosed

Legal description of redevelopment project area X

Map of District X

Optional: Information in the following sections is not required by law, but would be helpful in evaluating theperformance of TIF in Illinois. *even though optional MUST be included as part of complete TIF report

List all overlapping tax districts in the redevelopment project area. If overlapping taxing district received a surplus, list the surplus.

__X__ The overlapping taxing districts did not receive a surplus.

Overlapping Taxing DistrictSurplus Distributed from redevelopment

project area to overlapping districts


‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

‐$

City of Naperville Water Street TIF District Annual Report for Fiscal Year Beginning May 1, 2015 and Ending December 31, 2016

WATER STREET TIF DISTRICT LEGAL DESCRIPTION

LOTS 1, 2, 3, 4, 5, 6, 7 AND 8 IN BLOCK 1, AND LOTS 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14 AND THE WEST HALF OF LOT 15 IN BLOCK 4, ALL IN MARTIN’S ADDITION TO NAPERVILLE, BEING A SUBDIVISION OF PART OF THE SOUTHEAST QUARTER OF SECTION 13, TOWNSHIP 38 NORTH, RANGE 9 EAST OF THE THIRD PRINCIPAL MERIDIAN, ACCORDING TO THE PLAT THEREOF RECORDED FEBRUARY 6, 1847 AS DOCUMENT 2584, IN DUPAGE COUNTY, ILLINOIS

TOGETHER WITH ALL OF WATER STREET LYING NORTH OF THE NORTH LINE OF BLOCK 4 AFORESAID, AND ALL OF WEBSTER STREET LYING NORTH OF THE SOUTH RIGHT-OF-WAY LINE OF AURORA AVENUE AND LYING WEST OF BLOCKS 1 AND 4 AFORESAID, AND ALL OF AURORA AVENUE LYING SOUTH OF THE SOUTH LINE OF BLOCK 4 AFORESAID AND LYING WEST OF THE SOUTHERLY EXTENSION OF THE WEST LINE OF THE EAST HALF OF LOT 15 IN BLOCK 4 AFORESAID, AND ALL OF THE PUBLIC ALLEY (FORMERLY PLATTED AS SQUAW LAIN) LYING WITHIN BLOCK 4 AFORESAID LYING WEST OF THE SOUTHERLY EXTENSION OF THE WEST LINE OF LOT 1 IN SAID BLOCK 4, AND ALL OF MAIN STREET LYING NORTH OF THE EASTERLY EXTENSION OF THE NORTH LINE OF BLOCK 4 AFORESAID, AND ALL OF THE DUPAGE RIVER LYING EAST OF THE NORTHERLY EXTENSION OF THE WEST RIGHT-OF-WAY LINE OF SAID WEBSTER STREET AND LYING WEST OF THE NORTHERLY EXTENSION OF THE EAST RIGHT-OF-WAY LINE OF SAID MAIN STREET AND LYING NORTH OF THE NORTH LINE OF BLOCK 1 AFORESAID, ALL IN DUPAGE COUNTY, ILLINOIS.

City of Naperville Water Street TIF District Annual Report for Fiscal Year Beginning May 1, 2015 and Ending December 21, 2016

Attachment B: CEO Certification NAPERVILLEWATER STREET TIF DISTRICTFY2016

Attachment C: Legal Opinion NAPERVILLE WATER STREET TIF DISTRICT FY2016

Attachment D: Activities Undertaken in Furtherance of the Objectives of the Redevelopment Plan NAPERVILLE WATER STREET TIF DISTRICT FY2016

Following site ground breaking as reported in the previous report on April 16, 2015, constructed activities were on-going throughout the reporting period.

Construction activities through the summer of 2015 were focused on demolition, site preparation and utility work.

In accordance with approved development plans, a 5-story parking deck, including 520 parking spaces, was constructed at 120 Water Street, Naperville IL. Construction activities were completed under City Building Permit 14-228. Occupancy of this building was approved on October 12, 2016.

A hotel facility with first floor retail/restaurant spaces was constructed at 120 Water Street, Naperville IL in accordance with City Building Permits 14-232, 14-233, 14-234, 14-235 and 14-236. An Occupancy Permit for the hotel and a first floor restaurant tenant were approved on November of 2016. Vacant first floor retail spaces continued to be occupied as tenants are secured and permits are approved.

Construction was initiated and progressing on a commercial building, known locally as the Loggia Building, including restaurant, banquet, hotel and retail space was constructed at 123 Water Street, Naperville IL in accordance with City Building Permit 14-216. Final occupancy was not approved during the reporting period.

Construction was initiated on a commercial building, known locally as the Theater Building, at 135 Water Street, Naperville IL in accordance with City Building Permit 13-4137.

Attachment F: Use of Funds Received NAPERVILLE WATER STREET TIF DISTRICT FY2016

The City of Naperville received $55,662 in tax increment and interest for the reporting Fiscal Year.

An expenditure of $6,987 was incurred for annual TIF audit fees; $443,129 was incurred to Chicago Title for title services; $65,336 was paid for engineering consulting Services; $9,445,910 was incurred for construction of the public improvements within the district.

The City deposited $6,870,000 in General Obligation Bond proceeds into the TIF Fund.

New Issue

Final Official Statement

Investment Ratings: Standard & Poor's ... AAA (Stable Outlook)

Moody's Investors Service ... Aaa

Subject to compliance by the City with certain covenants, in the opinion of Katten Muchin Rosenman LLP, Bond Counsel, under present law, interest on the Bonds is excludable

from gross income of the owners thereof for federal income tax purposes and is not included as an item of tax preference in computing the federal alternative minimum tax for individuals and corporations, but such interest is taken into account in computing an adjustment used in determining the federal alternative minimum tax for certain corporations. Interest on the Bonds is not exempt from present State of Illinois income taxes. See "TAX EXEMPTION" herein for a more complete discussion.

B Naperville

CITY OF NAPERVILLE

DuPage and Will Counties, Illinois

$61,605,000 General Obligation Bonds, Series 2016

Dated Date of Delivery Book-Entry Due on December 1, 2016-2035

The $61,605,000 General Obligation Bonds, Series 2016 (the "Bonds"), are being issued by the City of Naperville, DuPage and Will Counties, Illinois

(the "City"). Interest is payable semiannually on June 1 and December 1 of each year, commencing December 1, 2016. Interest is calculated based on a 360-day year of twelve 30-day months. The Bonds will be issued using a book-entry system. The Depository Trust Company ("DTC"), New York, New York, will act as

securities depository for the Bonds. The ownership of one fully registered Bond for each series and maturity will be registered in the name of Cede & Co., as

nominee for DTC and no physical delivery of Bonds will be made to purchasers. The Bonds will mature on December 1 in the following years and amounts.

AMOUNTS, MATURITIES, INTEREST RATES, YIELDS AND CUSIP NUMBERS

PrinGipal Due Interest

Amount Dec. 1 Rate Yield

$ 260.000 ........ 2016 2.000% 0.550%

515,000 ........ 2017 2.000% 0.820%

3,855,000 ........ 2018 2.000% 0.940%

7,025,000 ........ 2019 2.000% 1.070%

6,385,000 ........ 2020 2.000% 1.190%

5,220,000 ........ 2021 2.000% 1.320%

5,540,000 ........ 2022 2,000% 1.490%

5,550,000 ........ 2023 3.000% 1.600%

5,975,000 ........ 2024 3.000% 1.730%

4,785,000 ........ 2025 3.000% 1.870%

CUSIP(1) Principal Due Interest OUSIP(1)

Number Amount Dec. 1 Rate Yield Number

630412 WK6 $3,800,000 ........ 2026* 3.000% 2.000% 630412 WV2

630412 WL4 2, 925,000 ........ 2027* 3. 000% 2.120% 630412 WWO

630412 WM2 3,170,000 ........ 2028* 3.000% 2.220% 630412 WX8

630412 WNO 1,135,000 ........ 2029, 3.500% 2.560% 630412 WY6

630412 WP5 775,000 ........ 2030, 3.500% 2.590% 630412 WZ3

630412 W03 935,000 ........ 2031, 3.500% 2. 640% 630412 XA7

630412 WR1 970,000 ........ 2032, 3.500% 2.690% 630412 XB5

630412 WS9 995,000 ........ 2033* 3.500% 2.740% 630412 XC3

630412 WT7 1,030,000 ........ 2034* 3,500% 2.790% 630412 XD1

630412 WU4 760,000 ........ 2035* 3.500% 2.840% 630412 XE9

*These maturities have been priced to tail

OPTIONAL REDEMPTION

The Bonds due December 1, 2016-2025, inclusive, are non-callable. The Bonds due December 1, 2026-2035, are callable in whole or in part on any date

on or after December 1, 2025, at a price of par plus accrued interest to the redemption date. If less than all the Bonds are called, they shall be redeemed in such

principal amounts and from such maturities as determined by the District and within any maturity by lot. See "OPTIONAL REDEMPTION" herein.

PURPOSE, LEGALITY AND SECURITY

The Bond proceeds are expected to be used to (i) finance certain capital improvements in the City; (ii) advance refund a portion of the City's outstanding General Obligation Bonds, Series 2008 and General Obligation Bonds, Series 2009; and (iii) pay the costs of issuance of the Bonds. See "THE PROJECT" and

"PLAN OF FINANCING" herein.

The Bonds are valid and legally binding general obligations of the City and the City is obligated to levy ad valorem taxes upon all the taxable property within the City for the payment of the Bonds and the interest thereon without limitation as to rate or amount. However, the enforceability of rights or remedies with

respect to the Bonds may be limited by bankruptcy, insolvency or other laws affecting creditors' rights and remedies heretofore or hereafter enacted.

This Final Official Statement is dated June 8, 2016, and has been prepared under the authority of the City. An electronic copy of this Final Official

Statement is available from the www.speerfinancial.com web site under "Debt Auction Center/Competitive Official Statement Sales Calendar". Additional copies may be obtained from Ms. Rachel Mayer, Finance Director/City Treasurer, City of Naperville, 400 South Eagle Street, Naperville, Illinois 60540, or from the

Independent Public Finance Consultants to the City:

Speer Financial, Inc. INDEPENDENT MIJNICIPAL ADVI•QR S * E STABI.=ISIII!D ItJ54

ONE NORTI.I L.ASAI.LE STREE'I. SUITE ,tI00 i C'IIICAcGO. |LI,INOIS t•0ti02

T¢tephor!¢ 1312) •|6-]70•; Facsimile: (312) 3•46.1•833

CUSIP numbers appearing in this Final Official Statement have been provided by the CUSIP Service Bureau, which is managed on behalf of the American Bankers Association by S&P Capital IQ, a part of

McGraw Hill Financial Inc. The City is not responsible for the selection of CUSIP numbers and makes no representation as to their correctness on the Bonds or as set forth on the cover of this Final Official

Statement.

ATTACHMENT I: Obligations IssuedNAPERVILLE WATER STREET DISTRICTFY16

No dealer, broker, salesman or other person has been authorized by the City to give any information or to make

any representations with respect to the Bonds other than as contained in the Official Statement or the Final Official

Statement and, if given or made, such other information or representations must not be relied upon as having been

authorized by the City. Certain information contained in the Official Statement and the Final Official Statement may have been obtained from sources other than records of the City and, while believed to be reliable, is not guaranteed as

to completeness. THE INFORMATION AND EXPRESSIONS OF OPINION IN THE OFFICIAL STATEMENT

AND THE FINAL OFFICIAL STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF

THE OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE UNDER

EITHER SUCH DOCUMENT SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE

IN THE AFFAIRS OF THE CITY SINCE THE RESPECTIVE DATES THEREOF.

References herein to laws, rules, regulations, ordinances, resolutions, agreements, reports and other documents

do not purport to be comprehensive or definitive. All references to such documents are qualified in their entirety by reference to the particular document, the full text of which may contain qualifications of and exceptions to statements

made herein. Where full texts have not been included as appendices to the Official Statement or the Final Official

Statement, they will be furnished on request. This Official Statement does not constitute an offer to sell, or solicitation

of an offer to buy, any securities to any person in any jurisdiction where such offer or solicitation of such offer would

be unlawful.

(i)

Table of Contents

BOND ISSUE SUMMARY ............................................................................................................................................................................................ 1

AUTHORIZATION, PURPOSE AND SECURITY .................................................................................................................................................... 2

THE CITY ....................................................................................................................................................................................................................... 2

City Government and Services .................................................................................................................................................................................... 3

Employee Relations ..................................................................................................................................................................................................... 3

Education ..................................................................................................................................................................................................................... 4

Recreation .................................................................................................................................................................................................................... 4

Transportation .............................................................................................................................................................................................................. 4

SOCIOECONOMIC INFORMATION ........................................................................................................................................................................ 5

Building Permits .......................................................................................................................................................................................................... 6

Housing ........................................................................................................................................................................................................................ 7

Income ......................................................................................................................................................................................................................... 7

Retail Activity .............................................................................................................................................................................................................. 9

THE PROJECT .............................................................................................................................................................................................................. 9

PLAN OF FINANCING ............................................................................................................................................................................................... 10

DEBT INFORMATION ............................................................................................................................................................................................... 12

PROPERTY ASSESSMENT AND TAX INFORMATION ...................................................................................................................................... 14

REAL PROPERTY ASSESSMENT, TAX LEVY AND COLLECTION PROCEDURES ................................................................................... 15

Tax Levy and Collection Procedures ......................................................................................................................................................................... 15

Exemptions ................................................................................................................................................................................................................ 16

Property Tax Extension Limitation Law .................................................................................................................................................................... 17

Truth in Taxation Law ............................................................................................................................................................................................... 18

FINANCIAL INFORMATION ................................................................................................................................................................................... 18

Investment and Cash Management Policy ................................................................................................................................................................. 18

Financial Reports ....................................................................................................................................................................................................... 19

No Consent or Updated Information Requested of the Auditor ................................................................................................................................. 19

Summary Financial Information ................................................................................................................................................................................ 19

Transition to a Calendar Year .................................................................................................................................................................................... 24

EMPLOYEE RETIREMENT AND OTHER POSTEMPLOYMENT BENEFITS OBLIGATIONS .................................................................. 25

REGISTRATION, TRANSFER AND EXCHANGE ................................................................................................................................................ 25

Registration and Record Date .................................................................................................................................................................................... 25

Transfers and Exchanges ........................................................................................................................................................................................... 25

TAX EXEMPTION ...................................................................................................................................................................................................... 26

Summary of Bond Counsel Opinion .......................................................................................................................................................................... 26

Bonds Purchased at a Premium or a Discount ............................................................................................................................................................ 26

Exclusion From Gross Income Requirements ............................................................................................................................................................ 27

Risks of Non-Compliance .......................................................................................................................................................................................... 27

Federal Income Tax Consequences ............................................................................................................................................................................ 27

CONTINUING DISCLOSURE ................................................................................................................................................................................... 28

OPTIONAL REDEMPTION ...................................................................................................................................................................................... 29

LITIGATION ............................................................................................................................................................................................................... 29

LEGAL MATTERS ..................................................................................................................................................................................................... 29

OFFICIAL STATEMENT AUTHORIZATION ....................................................................................................................................................... 30

INVESTMENT RATINGS .......................................................................................................................................................................................... 30

DEFEASANCE AND PAYMENT OF BONDS ......................................................................................................................................................... 30

UNDERWRITING ....................................................................................................................................................................................................... 31

MUNICIPAL ADVISOR ............................................................................................................................................................................................. 31

CERTIFICATION ....................................................................................................................................................................................................... 31

APPENDIX A -

APPENDIX B -

APPENDIX C -

APPENDIX D -

FISCAL YEAR 2015 AUDITED FINANCIAL STATEMENTS

DESCRIBING BOOK-ENTRY-ONLY ISSUANCE

PROPOSED FORM OF OPINION OF BOND COUNSEL

EXCERPTS OF FISCAL YEAR 2015 AUDITED FINANCIAL STATEMENTS

RELATING TO THE CITY'S PENSION PLANS

(ii)

City of Naperville, DuPage and Will Counties, Rlinois

General Obligation Bonds, Series 2016

BOND ISSUE SUMMARY

This Bond Issue Summary is expressly qualified by the entire Final Official Statement, which is provided for the convenience of

potential investors and which should be reviewed in their entirety by potential investors.

Issuer: City of Naperville, DuPage and Will Counties, Illinois.

Issue: $61,605,000 General Obligation Bonds, Series 2016.

Dated Date: Date of delivery, expected to be on or about June 22, 2016.

Interest Due: Each June 1 and December 1, commencing December 1, 2016.

Principal Due: Each December 1, commencing December 1, 2016, through December 1, 2035, as detailed on

the cover page of this Final Official Statement.

Optional Redemption: The Bonds due December 1, 2016-2025, inclusive, are non-callable. The Bonds due December

1, 2026-2035, are callable in whole or in part on any date on or after December 1, 2025, at a

price of par plus accrued interest to the redemption date. If less than all the Bonds are called,

they shall be redeemed in such principal amounts and from such maturities as determined by the

District and within any maturity by lot. See "OPTIONAL REDEMPTION" herein.

Authorization: The City is a home rule unit under the 1970 Illinois Constitution, has no statutory debt limit, and

is not required to seek referendum approval to issue the Bonds.

Security: The Bonds are valid and legally binding general obligations of the City and the City is obligated to levy ad valorem taxes upon all the taxable property within the City for the payment of the

Bonds and the interest thereon without limitation as to rate or amount. However, the

enforceability of rights or remedies with respect to the Bonds may be limited by bankruptcy, insolvency or other laws affecting creditors' rights and remedies heretofore or hereatter enacted.

Investment Ratings: Standard & Poor's, a Division of the McGraw-Hill Companies, New York, New York ("S&P"), has assigned the Bonds an investment rating of "AAA (Stable Outlook)"; and Moody's Investors

Service, New York, New York ("Moody's') has assigned the Bonds an investment rating of

"Aaa". See "INVESTMENT RATINGS" herein.

Purpose: The Bond proceeds are expected to be used to (i) finance certain capital improvements in the

City; (ii) advance refund a portion of the City's outstanding General Obligation Bonds, Series

2008 and General Obligation Bonds, Series 2009; and (iii) pay the costs of issuance of the

Bonds. See "PLAN OF FINANCING" herein.

Tax Exemption: Katten Muchin Rosenman LLP, Chicago, Illinois, will provide an opinion as to the tax

exemption of the interest on the Bonds as discussed under "TAX EXEMPTION" in this Final

Official Statement. Interest on the Bonds is not exempt from present State of Illinois income

taxes.

Bond Registrar/Paying Agent/ Escrow Agent: UMB Bank, St. Louis, Missouri.

Verification Agent: Grant Thornton LLP, Minneapolis, Minnesota.

Delivery: The Bonds are expected to be delivered on or about June 22, 2016.

Book-Entry Form: The Bonds will be registered in the name of Cede & Co. as nominee for The Depository Trust

Company ("DTC"), New York, New York. DTC will act as securities depository of the Bonds.

See APPENDIX B herein.

Denomination: $5,000 or integral multiples thereof.

City of Naperville, DuPage and Will Counties, Illinois


Becky Anderson

Rebecca Boyd-Obarski Judy Brodhead

CITY OF NAPERVILLE


Steve C. Chirico

Mayor

City Council Members

Kevin Coyne Kevin Gallaher

Patty Gustin

Paul Hinterlong John Krummen

OFFICIALS

Pam R. Gallahue

City Clerk

Douglas Krieger City Manager

Rachel Mayer Finance Director Treasurer

Speer Financial, Inc.

Municipal Advisor

Katten Muchin Rosenman LLP

Bond Counsel

AUTHORIZATION, PURPOSE AND SECURITY

The $61,605,000 General Obligation Bonds, Series 2016 (the "Bonds"), are being issued pursuant to the home

rule powers of the City of Naperville, DuPage and Will Counties, Illinois (the "City"), under Section 6 of Article VII

of the 1970 Constitution of the State of Illinois, and pursuant to a bond ordinance adopted by the City Council on the

17th day of May, 2016 (the "Bond Ordinance"). Bond proceeds will be used to (i) finance certain capital improvements of the City, (ii) advance refund a portion of the City's outstanding General Obligation Bonds, Series

2008 and General Obligation Bonds, Series 2009, and (iii) to pay the costs of issuing the Bonds. See "THE

PROJECT" and "PLAN OF FINANCE" herein. The Bonds constitute valid and legally binding full faith and credit

general obligations of the City, and are payable from any funds of the City legally available for such purpose, and all

taxable property in the City is subject to the levy of taxes to pay the same without limitation as to rate or amount. The

Bond Ordinance provides for the levy of ad valorem taxes, unlimited as to rate or amount, upon all taxable property within the City in amounts sufficient to pay, as and when due, all principal of and interest on the Bonds. The Bond

Ordinance will be filed with the County Clerks of DuPage and Will Counties, and will serve as authorization to said

County Clerks to extend and collect the property taxes as set forth in the Bond Ordinance.

THE CITY

The City, incorporated in 1857, is located in southwestern DuPage County with a portion in Will County and

covers an area of approximately 39.90 square miles. The City is a home-rule unit of government under the 1970 Illinois

Constitution and operates under the Council-Manager form of government. The City is located along the 1-88 State of

Illinois designated High Technology Corridor and is home to many corporate headquarters, research centers and

facilities for many well-known national and international companies. The City has been one of the fastest growing communities in the Chicago metropolitan area over the past decade and, based on U.S. Census Bureau estimates, is the

fourth largest city in the state with a population of 146,128, as of July 1, 2014.

City of NaperviUe, DuPage and Will Counties, Illinois


City Government and Services

Since October 1, 1969, the City has been operating under a Council-Manager form of government. The City Manager is appointed by the Council, which consists of a Mayor and eight Councilmen who are elected for overlapping four-year terms. The Council sets policy for the City, adopts ordinances and resolutions, approves the annual budget and approves all expenditures or disbursements. Total budgeted employment of the City is 968 full-time equivalent positions.

The City owns its own water, wastewater and electric distribution systems. The wastewater system has over

41,000 customers and the water system has over 42,000 customers with consumption of 5.8 billion gallons. The electric

system serves over 57,000 customers. Natural gas is provided by Northern Illinois Gas, cable television is provided by Comcast, AT&T Broadband, and Wide Open West, and telephone service is provided by Ameritech, AT&T, and

various other companies.

The City's Police Department, consisting of 168 sworn employees and 107 civilian employees, provide police protection. The City's Public Safety Answering Point (the "911 Center") became accredited in fiscal year 2002, making Naperville the first City in the country with an accredited dispatch center and police and fire department.

The Fire Department, consisting of 192 full time personnel and 10 civilian employees, provides fire protection as well as paramedic and special rescue services to the City's residents. The Department is staffed 24 hours per day and

operates a total of 23 front line engines, front line ambulances, and front line ladder trucks with 1 Shift Commander

and 1 Safety Officer. The Department maintains 10 advanced-life-support vehicles and 9 fire suppression vehicles, and

4 ladder truck vehicles, which operate out of 10 stations. The City currently maintains an ISO fire insurance rating of

2. The Fire Department is accredited by the Commission for Public Safety Excellence.

The City owns and appoints a board which operates the Naperville Public Libraries. The libraries contain over

792,000 volumes as well as periodicals, audiovisual equipment and software available for City residents. Nichols

Library was built in 1986 and is approximately 63,000 square feet in size. The Naper Boulevard Library, a 64,000

square foot branch library, was completed in December 1992. The 95th Street Library was completed in 2003 and is

the biggest library of the three in the City with 73,000 square feet in size.

Employee Relations(I)

Salaries, working conditions and benefits of certain employees in the following departments are governed through bargaining agreements:

Budgeted Full Time

Department Equivalent Water/Wastewater .................................................................... 46

Water -Local Union No. 150 ....................................................... 8

Police -Labor Council/F.O.P. Lodge No. 42 .................................... 134

Police -Labor Council/F.O.P. Lodge No. 42-1 ................................. 5

Police -Labor Council/F.O.P. Lodge No. 42-2 ................................. 25.5

Police -MAP Chapter 363 ........................................................... 24

Police -MAP Chapter 582 ........................................................... 10

Electric ................................................................................. 59

Public Works Operating Engineers -Local Union No. 150 .................... 45

DPW-Field Supervisors -Local Union No. 150 ................................. 6

DPW-Fleet -Local Union No. 150 ................................................. 16

Public Works Operating Engineers -Local Union No. 399 .................... 12

Fire-Firefighters ...................................................................... 185

Expiration Negotiating Negotiating December 31, 2019

Negotiating

Negotiating December 31,2019

Negotiating Negotiating

April 30, 2017

Negotiating

Negotiating

Negotiating

Negotiating

Note: (1) Source: City of Naperville.

All other employees are compensated based on a plan approved annually by the City Council.



Education

There are two public school districts that serve the City. Naperville Community Unit School Number 203 has a

total enrollment of over 16,900 students for the 2015-2016 school year. District 203 operates 14 elementary schools, five junior high schools and two high schools. Indian Prairie Community Unit School District Number 204 had a total

enrollment of over 28,500 for the 2015-2016 school year. District 204 operates twenty-one elementary schools, seven

middle schools, three high schools, one alternative school and one pre-school The area also has seven private schools in

the City.

In addition, there are many higher educational opportunities within the surrounding areas such as Northern

Illinois University, North Central College, DePaul University, Robert Morris College, and College of DuPage. Other

educational institutions in surrounding communities include Benedictine University, National-Lewis University, Illinois

Institute of Technology, Aurora University, and Wheaton College as well as the many other colleges and universities

within the Chicago-land area.

Recreation

The City is served by the Naperville Park District (the "District"). The District maintains and operates more

than 2,400 acres with 137 parks and facilities and provides more than 1,400 recreational, arts and environmental

programs and special events annually. Included within the District's operations are two championship golf courses, a

multitude of playgrounds, trails, athletic courts and sports fields, two inline skating and skateboarding facilities, the Millennium Carillon, a paddleboat quarry, and historic Centennial Beach. The City also has a fully developed Riverwalk system that traverses through the City's downtown. The City is also home to Naper Settlement, a historical

settlement which has replica businesses and working shops, primarily from the 19th Century. In addition, the DuPage County Forest Preserve has over 4,500 areas of open space within close proximity of the City.

Transportation

The City is located approximately 28 miles west of downtown Chicago along the Illinois Research and

Development Corridor, which was designated in April of 1986 by the State of Illinois as an area targeted for growth as

a high-technology corridor. Commuter travel to and from Chicago's downtown is available via the Burlington-Northern Santa Fe Railway at two train stations. Also accessible to the City are Interstate 290 (the Eisenhower Expressway), Interstate 88 (Reagan Memorial Tollway), Interstate 355 (Veterans Memorial Tollway) and Interstate 55 (Stevenson

Expressway). Air travel is also accessible to residents and corporations: O'Hare International Airport is located just 26

miles northeast of the City, Midway Airport is approximately 22 miles east, DuPage County Airport lies 15 miles

northwest and Aurora Municipal Airport 10 miles to the west.



SOCIOECONOMIC INFORMATION

Following are lists of large employers located in the City and in the surrounding area.

Major City Employers (1)

Nam____ee Product/Service Edward Hospital ...........................................

General Hospital .............................................. 4,700 AlcateI-Lucent ............................................

Telecommunications Research ................................... 3,400

School District Number 204 ................................ Public School District ........................................ 3,022

School District Number 203 ................................ Public School District ........................................ 2,350

Nicer Gas ................................................. Gas Distribution Headquarters ................................. 2,140

BP America ................................................ Testing Laboratory ............................................ 1,800

BMO Harris ................................................ National Bank ................................................. 1,200

Nalco ..................................................... Water Treatment ............................................... 1,000

City of Naperville ........................................ Municipality .................................................. 965

Coriant ................................................... Telecommunications Equipment .................................. 700

North Central College ..................................... Liberal Arts College .......................................... 625

Approximate

Employment

Note" (I) Source" 2016 Illinois Manufacturers Directory, 2016 Illinois Services Directory, the City's 2015 CAFR and a selective

telephone survey.

Major Area Employers (1)

Approximate Location Nam_.__ee Product/Service Employment Lisle ...................... Navistar, Inc ................................. Holding Company Headquarters ................ 3,000

Lisle ...................... IC Bus, LLC ................................... School Buses Company Headquarters ........... 2,800

Aurora ..................... Rush Copley Medical Center .................... General Hospital ............................ 2,000

Lisle ...................... Platinum Systems Specialists, In¢ ............. Computer Consulting ......................... 1,500

Aurora ..................... Presence Mercy Medical Center ................. General Hospital ............................ 1,300

Aurora ..................... Dreyer Medical Clinic ......................... Medical Center .............................. 1,200

Lisle ...................... Molex, LLC .................................... Electronic Components ....................... 1,000

Lisle ...................... Valid USA, Inc ................................ Marketing Services .......................... 1,000

Lisle ...................... CA Technologies ............................... Software Development ........................ 800

Warrenville ................ EN Engineering, LLC ........................... Engineering ................................. 800

Aurora ..................... Metlife, Inc .................................. Insurance ................................... 760

Warrenville ................ Liberty Mutual Insurance Co ................... Insurance ................................... 600

Bolingbrook ................ Ulta Salon Cosmetics and Fragrance, Inc ....... Cosmetics ................................... 600

Note" (1) Source" 2016 Illinois Manufacturers Directory, 2016 Illinois Services Directory, and a selective telephone survey.

The following tables show employment by industry and by occupation for the City, DuPage County, Will

County and the State of Illinois (the "State") as reported by the U.S. Census Bureau 2010-2014 American Community Survey 5-year estimated values.

Employment By Industry (1)

Classification

Agriculture, Forestry, Fishing and Hunting, and Mining .............

Construction ......................................................

Manufacturing ............ • ........................................

Wholesale Trade ....................................................

Retail Trade ......................................................

Transportation and Warehousing, and Utilities ......................

Information .......................................................

Finance and Insurance, and Real Estate and Rental and Leasing ......

Professional, Scientific, and Management, and Administrative

and Waste Management Services ....................................

Educational Services and Health Care and Social Assistance .........

Arts, Entertainment and Recreation and Accommodation and

Food Services ....................................................

Other Services, Except Public Administration .......................

Public Administration ..............................................

Total ...........................................................

The City DuPage County Will County The State

Number Percent Number Percent Number Percent Number Percent

116 0.2% 1,073 0.2% 1,330 0.4% 63,558 1.1%

1,879 2.6% 21,266 4.5% 19,030 5.8% 308,760 5.1%

7,399 10.3% 59,480 12.5% 38,475 11.8% 756,747 12.5%

2,303 3.2% 18,786 4.0% 10,573 3.2% 181,855 3.0%

7,782 10.8% 50,165 10.6% 39,827 12.2% 663,401 11.0%

2,584 3.6% 26,435 5.6% 25,040 7.7% 353,089 5.9%

2,421 3.4% 12,523 2.6% 6,740 2.1% 124,634 2.1%

8,047 11.2% 43,157 9.1% 21,722 6.6% 442,091 7.3%

12,686 17.6% 66,903 14.1% 36,102 11.0% 681,276 11.3%

16,184 22.4% 99,913 21.1% 73,100 22.3% 1,391,310 23.1%

5,713 7.9% 40,828 8.6% 27,754 8.5% 544,222 9.0%

3,334 4.6% 22,660 4.8% 15,108 4.6% 288,596 4.8%

1,656 2.3% 11,412 2.4% 12 469 3.8% 232,492 3.9%

72,104 100.0% 474,601 100.0% 327,270 100.0% 6,032,031 100.0%

Note: (1) Source" U.S. Bureau of the Census, American Community Survey 5-year estimates 2010 to 2014.



Employment By Occupation(I)

The City Classification Number Percent

Management, Business, Science and Arts ............................. 40,604 56.3% 210,394 44.3%

Service ........................................................... 7,536 10.5% 62,712 13.2%

Sales and Office ................................................... 18,672 25.9% 125,860 26.5%

Natural Resources, Construction, and Maintenance ................... 1,921 2.7% 26,103 5.5%

Production, Transportation, and Material Moving .................... 3,371 4.7% 49,532 10.4%

Total ........................................................... 72,104 100.0% 474,601 100.0%

DuPage County Number Percent

Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2010 to 2014.

Will County Number Percent

118,255 36.1%

51,201 15.6%

84,609 25.9%

28,241 8.6%

44 964 13.7%

327,270 100.0%

The State

Number Percent

2,204,363 36.5%

1,048,478 17.4%

1,500,220 24,9%

441,705 7.3%

837,265 13.9%

6,032,031 100.0%

Annual Average Unemployment Rates (1)

Calendar The DuPage Will The

Year City Count• County State

2007 .............. 3.3% 3.8% 4.7% 5.1%

2008 .............. 3.6% 5.8% 6.1% 6.4%

2009 .............. 6.2% 8.6% 10.1% 10.0%

2010 .............. 8.0% 8.3% 10.7% 10.5%

2011 .............. 6.1% 7.3% 10.1% 9.7%

2012 .............. 6.7% 7.2% 9.1% 8.9%

2013 .............. 7.1% 7.5% 9.4% 9.2%

2014 .............. 5.5% 5.6% 7.4% 7.1%

2015 .............. 4.5% 4.7% 6.0% 5.1%

2016(2) ........... 4.6% 5.3% 7.0% 7.1%

Notes: (1) Source: Illinois Department of Employment Security. (2) Preliminary rates for January 2016.

Building Permits

Residential building permits have averaged $89,051,297 annually over the last five years in the City, excluding the value of land.

City Building Permits(I)

Commercial Construction Residential Construction

Calendar Number of Number of

Year Units Value Units Value Total

2011 ...... 27 $ 20,957,024 186 $50,878,360 $ 71,835,384

2012 ...... 13 28,975,537 195 80,054,208 109,029,745

2013 ...... 27 119,583,402 298 90,813,098 210,396,500

2014 ...... 20 95,129,800 357 117,571,523 212,701,323

2015 ...... 25 183,253,255 348 105,939,296 289,192,551

Note: (1) Source: The City.



Housing

The U.S. Census Bureau 5-year estimated values reported that the median value of the City's owner-occupied homes was $377,900. This compares to $279,700 for DuPage County, $212,700 for Will County and $175,700 for the

State. The following table represents the five year average market value of specified owner-occupied units for the City, DuPage and Will Counties and the State at the time of the 2010-2014 American Community Survey.

Value

Under $50,000 ...................................

$50,000 to $99,999 ..............................

$100,000 to $149,999 ............................

$150,000 to $199,999 ............................

$200,000 to $299,999 ............................

$300,000 to $499,999 ............................

$500,000 to $999,999 ............................

$1,000,000 or more ..............................

Total .........................................

Home Values(I)

Ihe City DuPage County Will County The State


521 1.4% 5,586 2.2% 5,962 3.3% 243,163 7.6%

641 1.7% 9,400 3.8% 10,978 6.0% 508,867 15.9%

1,340 3.6% 19,191 7.7% 26,026 14.2% 525,634 16.5%

2,564 6.8% 32,891 13.2% 40,657 22.2% 533,202 16.7%

6,164 16.4% 71,497 28.7% 53,751 29.4% 663,672 20.8%

18,199 48.3% 74,628 30.0% 36,360 19.9% 486,000 15.2%

7,657 20.3% 28,824 11.6% 8,618 4.7% 188,718 5.9%

585 1.6% 6 819 2.7% 561 0.3% 45,451 1.4%

37,671 100.0% 248,836 100.0% 182,913 100.0% 3,194,707 100.0%


Mortgage Status(I)

Value

Housing Units with a Mortgage .................

Housing Units without a Mortgage ..............

Total .......................................



28,970 76.9% 180,371 72.5% 140,090 76.6% 2,146,363 67.2%

8,701 23.1% 68,465 27.5% 42,823 23.4% 1,048,344 32.8%

37,671 100.0% 248,836 100.0% 182,913 100.0% 3,194,707 100.0%


Income

Per Capita Personal Income

for the Highest Income Counties in the State(l)

Rank 2010-2014

1 ..................... DuPap County ............... $38,931

2 ...................... Lake County ................. 38,459

3 ...................... MoHenry County .............. 33,118

4 ...................... Monroe County ............... 33,059

5 ...................... Piatt County ................ 31,750 6

...................... Kendall County .............. 31,110

7 ..................... Will County ................. 30,791

8 ...................... McLean County ............... 30,728

9 ...................... Kane County ................. 30,645

10 ..................... Sangamon County ............. 30,594

11 ..................... Cook County ................. 30,468

Note: (1) Source: U.S. Bureau of the Census. 2010-2014

American Community 5-Year Estimates.

O'ty of Naperville, DuPage and Will Counties, Illinois


The following shows a ranking of median family income for the Chicago metropolitan area from the 2010-2014

American Community Survey.

Ranking of Median Family Income (1)

Family County Income Rank

OuPage County ......... $96,330 1

Lake County ........... 92,910 2

Kendall County ........ 92,794 3

McHenry County ........ 88,699 4

Will County ........... 87,503 5

Kane County ........... 81,273 8

Cook County ........... 66,712 25

Note: (1) Source: U.S. Bureau of the Census 2010-2014

American Community Survey 5-Year Estimates.

The U.S. Census Bureau 5-year estimated values reported that the City had a median family income of

$127,554. This compares to $96,330 for DuPage County, $87,503 for Will County and $70,967 for the State. The

following table represents the distribution of family incomes for the City, DuPage and Will Counties and the State at

the time of the 2010-2014 American Community Survey.

Family Income(I)

The City Income Number Percent

Under $10,000 ................................. 554 1.5%

$10,000 to $14,999 ............................ 273 0.7%

$15,000 to $24,999 ............................ 938 2.5%

$25,000 to $34,999 ............................ 1,131 3.0%

$35,000 to $49,999 ............................ 2,370 6.2%

$50,000 to $74,999 ............................ 3,977 10.4%

$75,000 to $99,999 ............................ 4,330 11.4%

$100,000 to $149,999 .......................... 9,279 24.3%

$150,000 to $199,999 .......................... 6,430 16.9%

$200,000 or more .............................. 8,864 23.2%

Total ....................................... 38,146 100,0%

DuPage County Will County Number Percent Number Percent

4,595 1.9% 4,435 2.6%

2,785 1.2% 2,365 1.4%

9,215 3.9% 8,246 4.8%

12,707 5.3% 9,374 5.5%

22,417 9.4% 16,073 9.4%

36,905 15.4% 30,345 17.7%

36,293 15.2% 29,305 17.1%

53,766 22.5% 39,903 23.3%

27,457 11.5% 17,748 10.4%

33,087 13.8% 13,423 7.8%

239,227 100.0% 171,217 100.0%


The State

Number

138 048

84 725

222 412

252 033

376 290

577 132

465095

553,083

230 525

231,782

Percent

4.4%

2. 7%

7.1%

8.0%

12.0%

18.4%

14. 9%

17.7%

7.4%

7.4%

3,131,125 100.0%

The U.S. Census Bureau 5-year estimated values reported that the City had a median household income of

$109,512. This compares to $79,016 for DuPage County, $76,142 for Will County and $57,166 for the State. The

following table represents the distribution of household incomes for the City, DuPage and Will Counties and the State

at the time of the 2010-2014 American Community Survey.

Household Income(I)

Income

Under $10,000 ................................. 1,518

$10,000 to $14,999 ............................ 683

$15,000 to $24,999 ............................ 2,176

$25,000 to $34,999 ............................ 2,445

$35,000 to $49,999 ............................ 3,960

$50,000 to $74,999 ............................ 6,053 $75,000 to $99,999 ............................ 5,947

$100,000 to $149,999 .......................... 10,599

$150,000 to $199,999 .......................... 6,962

$200,000 or more .............................. 9,398

Total ....................................... 49,741



3.1% 11,774 3.5% 8,129 3.6%

1.4% 8,045 2.4% 5,377 2.4%

4.4% 21,052 6.2% 15,759 7.1%

4.9% 24,800 7.4% 15,651 7.0%

8.0% 37,880 11.2% 24,324 10.9%

12.2% 56,776 16.8% 40,497 18.1%

12.0% 48,203 14.3% 35,127 15.7%

21.3% 62,317 18.5% 44,739 20.0%

14.0% 30,405 9.0% 19,213 8.6%

18.9% 35,751 10.6% 14 563 6.5%

100.0% 337,003 100.0% 223,379 100.0%

341,784 7.2%

218,422 4.6%

479,384 10.0%

455,890 9.5%

614,706 12.9%

852,342 17.8%

612,247 12.8%

671,103 14.0%

265,693 5.6%

267,062 5.6%

4,778,633 100.0%




Retail Activity

Following is a summary of the City's sales tax receipts as collected and disbursed by the State of Illinois.

Retailers' Occupation, Service Occupation and Use Tax(l)(2)

State Fiscal Year Municipal Percent

Ending June 30 Tax Change +(-)

2006 .............. $26,243,702 (7.95%)

2007 .............. 27,190,176 3.61%

2008 .............. 27,131,897 (0.21%)

2009 .............. 25,573,987 (5.74%) 2010 .............. 24,854,740 (2.81%)

2011 .............. 26,861,455 8.07%

2012 .............. 28,055,015 4.44%

2013 .............. 30,030,630 7.04%

2014 .............. 32,014,712 6.61%

2015 .............. 33,336,313 4.13%

Growth from 2006 to 2015 ............. 27.03%

Notes: (1)

(2)

Source: Illinois Department of Revenue.

Tax distributions are based on records of the

Illinois Department of Revenue relating to the 1%

municipal portion of the Retailers' Occupation, Servioe Occupation and Use Tax, collected on

behalf of the City, less a State administration

fee. The municipal 1% includes tax receipts from

the sale of food and drugs which are not taxed by the State.

THE PROJECT

A portion of Bond proceeds will be used to finance certain capital improvements in the City. The capital improvements include: E-Government initiatives related to the upgrading and replacement of technology infrastructure

and expansion of the City's technology resources; building maintenance and upgrades; stormwater management

programs; urban forest initiatives related to the mitigation of the Emerald Ash Borer and planting of new City trees;

traffic improvement programs; and improvements within the Water Street TIF District including utility construction,

parking deck construction and right-of-way construction and upgrades.



PLAN OF FINANCING

A portion of the Bond proceeds are expected to be used to advance refund a portion of the City's outstanding General Obligation Bonds, Series 2008 and General Obligation Bonds, Series 2009, as listed below (collectively, the

"Refunded Bonds").

The Refunded Bonds


Outstanding

Maturities Amount

12/1/2016 ................. $ 2,400,000

12/1/2017 .................

12/1/2018 .................

12/1/2019 ................. 12/1/2020 .................

12/1/2021 .................

12/1/2022 .................

12/1/2023 .................

12/1/2024 .................

12/1/2025 .................

12/1/2026 .................

12/1/2027 .................

12/1/2028 .................

12/1/2029 .................

12/1/2030 .................

12/I/2031 .................

12/1/2032 .................

12/1/2033 .................

12/1/2034 .................

12/1/2035 .................

12/1/2036 .................

12/1/2037 .................

12/1/2038(1) ..............

Total ................... $29,

3.095.000

2.890.000

2.885.000

2.880.000

2.875,000

2.870.000

2,870,000

2.665.000

1.860.000

260 000 (1)

125 000(I)

130 000 (1)

135 000

140 000(1)

150 000(1)

155,000(1)

165 000(I)

170 000(1)

180 000(1)

190 000(1)

200 000 (1)

205,000

495.000

Amount Redemption Redemption

Refunded Prioe Date

$ 0 N/A N/A

0 N/A N/A

2,890,000 100% 12/I/2017

2,885,000 100% 12/1/2017

2,880,000 100% 12/1/2017

2,875,000 100% 12/1/2017

2,870,000 100% 12/1/2017

2,870,000 100% 12/1/2017

2,665,000 100% 12/1/2017

1.860.000 100% 12/1/2017

260,000 100% 12/1/2017

125,000 100% 12/1/2017

130,000 100% 12/1/2017

135,000 100% 12/1/2017

140,000 100% 12/1/2017

150,000 100% 12/1/2017

155,000 100% 12/1/2017

165,000 100% 12/1/2017

170,000 100% 12/1/2017

180,000 100% 12/1/2017

190,000 100% 12/1/2017

200.000 100% 12/1/2017

205,000 100% 12/1/2017

$24,000,000


Outstanding Maturities Amount

12/1/2016 ............... $ 2,400,000

12/1/2017 ............... 2,500,000

12/1/2018 ............... 2.800,000

12/1/2019 ............... 2,930,000

12/1/2020 ............... 1,800,000

12/1/2021 ............... 1,900,000

12/1/2022 ............... 2,000,000

12/1/2023 ............... 2,100,000

12/1/2024 ............... 2,190,000

12/1/2025 ............... 2,250,000

12/1/2026 ............... 2,350,000

12/1/2027 ............... 2,450,000

12/1/2028 ............... 2,480,000 Total ................. $30,150,000

Note: (1) Mandatory sinking fund redemption.

Amount Redemption Redemption Refunded Price Date

0 N/A N/A 0 N/A N/A 0 N/A N/A

2,930,000 100% 12/1/2018

1,800,000 100% 12/1/2018

1,900,000 100% 12/1/2018

2.000.000 100% 12/1/2018

2,100,000 100% 12/1/2018

2,190,000 100% 12/1/2018

2,250.000 100% 12/1/2018

2,350,000 100% 12/1/2018

2.450,000 100% 12/1/2018

2,480,000 100% 12/1/2018

$22,450,000

10



A portion of the Bond proceeds will be used to purchase direct full faith and credit obligations of the United States of America (the "Government Securities"), the principal of which together with interest to be earned thereon will be sufficient to pay when due the principal of and interest on the Refunded Bonds up to and including the redemption date thereof.

The Government Securities will be held in an escrow account created pursuant to an escrow agreement (the "Escrow Agreement") dated as of June 22, 2016, between the City and UMB Bank, St. Louis, Missouri, as escrow agent.

The mathematical calculations: (a) of the adequacy of the deposit made pursuant to the Escrow Agreement to

provide for the payment of certain interest and principal on the Refunded Bonds, and (b) supporting the conclusion that the Bonds are not "arbitrage bonds" under Section 148 of the Internal Revenue Code of 1986, as amended (the "Code"), will be verified by Grant Thornton LLP, Minneapolis, Minnesota (the "Verification Agent"), at the time of delivery of the Bonds. All moneys and Government Securities deposited for the payment of Refunded Bonds, including interest thereon, are required to be applied solely and irrevocably to the payment of the Refunded Bonds.

11



DEBT INFORMATION

After issuance of the Bonds, the City will have outstanding $165,255,000 principal amount of general obligation debt. The City does not expect to issue additional general obligation debt in 2016.

General Obligation Bonded Debt(l)

(Principal Only)

Total

Less: The Refunded Bonds Principal

Calendar Series Series Series Series Series Series Series Series Series The Series Series All GO Principal Retired

Year 2008 2009 2010A 2010B 20100 2011 2012 2013 2014 Bonds 2008 2009 Bonds Amount Percent

2016 ....... $ 2,400,000 $ 2,400, 000 $ 0 $ 1,500, 000 $ 685.000 $ 1,100. O00 $ 2,210,000 $ 200, 000 $ 0 $ 260, 000 $ 0 $ 0 $ 10, 7GS, 000 $ 10, 755,000 6. 51•

2017 ....... 3,095.000 2, GO0. 000 0 3,000, 000 715,000 1,100, 000 2, 260,000 200. 000 1. 840.000 515, 000 0 0 15, 225, 000 25, 980,000 15. 72•

2018 ....... 2, 890,000 2.800, 000 0 3,000, 000 745.000 1, I00. 000 3. 325.000 200, 000 400.000 3,855. OOO (2, 890,000) 0 15,425. 000 41. 405.000 25. OG•

2019 ....... 2,885,000 2.930, 000 0 2,500, 000 780.000 1,100. 000 3. 390.000 200. 000 0 7,025.000 (2, 885,000) (2,930, 000) 14, 995. 000 56.400,000 34,13•

2020 ....... 2,860.000 1,800. 000 0 2,500,000 815.000 1,100. 000 2. 565,000 500, 000 200,000 6.385, 000 (2, 880, 000) (1,800,000) 14,065. 000 70. 465,000 42. 64•

2021 ....... 2.875.000 1. 900. 000 0 2.500. 000 855,000 1,000. 000 2, 530.000 500, 000 1. 000.000 5,220, 000 (2, 875,000) (1. 900,000) 13, 605, 000 84,070, 000 50. 87•

2022 ....... 2.870.000 2,000,000 0 2,500.000 0 1,000.000 1.970.000 500,000 1,000,000 5,540.000 (2,870,000) (2.000,000) 12,510.000 96,580.000 58.44•

2023 ....... 2.870,000 2.100, 000 975.000 1,525,000 0 1,000, 000 1,830.000 500,000 2,000,000 5,550, 000 (2, 870, 000) (2,100,000) 13,380, 000 109. 960,000 66. 54•

2024 ....... 2,665,000 2,190, 000 2, GO0, O00 0 0 1,000, 000 1. 445,000 500,000 900, 000 G, 975,000 (2, 665,000) (2,190,000) 12, 320, 000 122, 280. 000 73. 99•

2025 ....... 1,860, 000 2,250, OOO 1,500, 000 0 0 1. 000, 000 1,175.000 500,000 1,400, 000 4, 785,000 (1,860, 000) (2,250, OOO) 10, 360, 000 132, 640,000 80.26%

2026 ....... 260.000 2.350,000 1,000,000 0 0 1,000, O00 0 200, 000 1,000.000 3,800. 000 (260,000) (2, 350, 000) 7,000,000 139,640.000 84. 50•

2027 ........ 125,000 2,450, 000 1,000,000 0 0 1. 000. 000 0 200.000 2. 200.000 2,925,000 (125, 000) (2, 450, 0003 7. 325,000 146,965,000 88.93•

2028 ........ 130,000 2,480, 000 1,000,000 0 0 1,000, 000 0 200, O00 1,100, 000 3,170, 000 (130. 000) (2, 480, 0003 6. 470, 000 153,435,000 92.85%

2029 ........ 135,000 0 0 0 0 1,200, 000 0 200. 000 GO0, O00 1.135,000 (135. 000) 0 3,135.000 156,570,000 84. 74%

2030 ........ 140. 000 0 0 0 0 0 0 200, 000 1,200,000 775. 000 (140, 000) 0 2,175, 000 158. 745. 000 86.06%

2031 ........ 150,000 0 0 0 0 0 0 420.000 800,000 935,000 (150,000) 0 2,155,000 160.900,000 97.36%

2032 ........ 155.000 0 0 0 0 0 0 0 600, 000 970. 000 (155,000) 0 1, 670, 000 152,470,000 88. 31%

2033 ........ 165. 000 0 0 0 0 0 0 0 0 995. 000 (165,000) 0 995, 000 163,465,000 88. 92%

2034 ........ 170.000 0 0 0 0 0 0 0 0 1. 030. OOO (170,000) 0 1,030.000 164. 495.000 89. 54%

2035 ........ 180. 000 0 0 0 0 0 0 0 0 760, 000 (180,000) 0 760, 000 185. 255,000 100. 00%

2036 ........ 190.000 0 0 0 0 0 0 0 0 0 (190,000) 0 0 165. 255,000 100. 00•

2037 ........ 200.000 0 0 0 O 0 0 0 0 0 (200, 000) 0 0 165. 255,000 100. 00%

2038 ........ 205 000 0 0 0 0 0 0 0 0 0 (205,000) 0 0 165. 255,000 100. 00•

Total ....... $29.405.000 $30,150,00• $7,975,000 $19,025,000 64.595,000 $14,700.000 $22,700,000 $5,220,000 $16,240.000 $61,605,000 $(24,000,000) $(22,450,0•) $165,255,000

12



Detailed Overlapping Bonded Debt(l)(2) (As of March 28, 2016)

Outstanding Debt

Applicable to City Percent(3) Amount

Schoo s:

Schoo District Number 200 ........................ $163,185,000 0.36%

Schoo District Number 202 ........................ 5,460,000 1.67%


Schoc District Number 204 ........................ 229,765,000 60.32%


Community College Number 502 ...................... 231,950, 000 16.31%

Community College Number 525 ...................... 188, 490,000 0.27%

Total Schools ............................................................................

$ 587,466

91,182

24,831,801

138,594,248 12,227

37,831,045

508,923

$202.456,892

Others:

DuPage County .....................................

DuPage County Forest Preserve .....................

Will County .......................................

Will County Forest Preserve District ..............

Lisle Park District ...............................

Naperville Park District ..........................

Wheaton Park District .............................

$166,395,000 12.41%

141,098,676 12.41%

122,235,000 11.23%

125,014,710 11.23%

12,207,000 0.43%

25,070,000 96.35%

34,985,000 0.26%

Total Others ............................................................................

Total Schools and Others Overlapping Bonded Debt ........................................

$ 20,649,620

17,510,346

13,726,991

14,039,152

52,490

24,154,945

90,961 $ 90,224,504

$292,681,396

Note: (1) Source: DuPage and Will County Clerk.

(2) Includes alternate revenue source bonds. Does not include debt certificates.

(3) Percentages are based on 2015 Equalized Assessed Valuations, the most recent available.

Statement of Bonded Indebtedness (1)

Assessed Valuation of Taxable Property, 2015 .....

Estimated Actual Value, 2015 .....................

Amount

Applicable $ 6,278,656,175

$18,835,968,525

Ratio To

Equalized Assessed

100.00%

300.00%

Estimated

Actual

33.33%

100.00%

City Direct Bonded Debt(2) ....................... $ 165,255,000 2. 63% 0.88%

Overlapping Debt:(3)

Schools ........................................

All Others .....................................

Total Overlapping Bonded Debt ....................

Total Net Direct & Overlapping Debt(2)(3) ........

$ 202,456.892

90,224,504 $ 292,681,396

$ 457,936,396

3.22%

1.44%

4.66%

7.29%

1.07%

0.48%

1.55%

2.43%

Notes: (1) Source: The City. (2) Includes the Bonds and excludes the Refunded Bonds.

(3) As of March 28, 2016.

Per Capita (2010 Special

Census 141,853) $ 44,261.71

$132,785.13

$ 1,164.97

$ 1,427.23

636.04

$ 2,063.27

$ 3,228.25

13



PROPERTY ASSESSMENT AND TAX INFORMATION

For the 2015 levy year, the City's EAV was comprised of approximately 81% residential, 19% commercial and

industrial, and less than 1% of farm and railroad property valuations.

Equalized Assessed Valuation(I)

Levy Years

Property Class 2011 2012 2013 2014 2015

Residential ............. $5,256,081,268 $4,964,302,585 $4,866,627,723 $4,917,955,140 $5,056,340,567 Farm .................... 314,912 334,456 315,592 215,985 190,521

Commercial/Industrial... 1,170,708,392 1,105,830,624 1,056,949,654 1,071,651,247 1,219,286,607

Railroad ................ 2,364,303 2,509,329 2,706,677 2,731,565 2,838,480

Total ................... $6,429,468,875 $6,072,976,994 $5,926,599,646 $5,992,553,937 $6,278,656,175 Percent change +(-) (4.31%) (2) (5.54%) (2.41%) 1.11% 4.77%

Notes: (1) Source: DuPage and Will County Clerks' offices.

(2) Percentage change based on a levy year 2010 EAV of $6,718,739,726.

Representative Tax Rates (1)

(Per $100 EAV)

2011

City Rates:

Corporate Fund ........................... $0.1381 Bonds and Interest

......................

IMRF ....................................

Firefighter's Pension ...................

Police Pension ..........................

Aquarium/Museum ......................... Library .................................

Total City Rate ........................ $0.7515

Levy Years

2012 2013 2014 2015

$0.1457 $0.1009 $0.0803 $0.1060 0.1799 0.1403 0.1631 0.2153 0.1249

0.0409 0.0444 0.0461 0.0460 0.0441

0.0737 0.0820 0.0884 0.0846 0.0945

0.0679 0.0787 0.0879 0.0845 0.0938

0.0434 0.0471 0.0499 0.0494 0.0471

0.2076 0.2374 0.2465 0.2481 0,2288

$0.7756 $0.7828 $0.8082 $0.7392

DuPage County ............................

DuPage County Forest Preserve District...

DuPage Airport Authority .................

Naperville Township(2) ...................

Naperville Park District .................

Unit School District 204 .................

Community College District Number 502 ....

Total(3) ...............................

0.1773 0.1929 0.2040 0.2057 0.1971

0.1414 0.1542 0.1657 0.1691 0.1622

0.0169 0.0168 0.0178 0.0196 0.0188

0.0894 0.0812 0.0900 0.0660 0.0738

0.2969 0.3148 0.3358 0.3397 0.3317

5.2200 5.7047 5.9601 6.0210 5.8505

0.2495 0.2681 0.2956 0.2975 0.2786

$6.9429 $7.5083 $7.8518 $7.9268 $7.6519

Notes: (1) Source: DuPage County Clerk.

(2) Includes Road and Bridge. (3) Representative tax rate is for Tax Code No 7030 which represents the largest tax code of the

City's 2015 EAV; the latest data available.

14



Tax Extensions and Collections(I)

Levy Collection

Year Year

2010 .............. 2011 .....

2011 .............. 2012 .....

2012 .............. 2013 .....

2013 .............. 2014 .....

2014 .............. 2015 .....

2015 .............. 2016 .....

Note' (1) Source" the City.

Tax Total

Extensions Collected Percent

$49,651,487 $49,340,763 99.37%

48,317,459 47,951,662 99.24%

47,102,010 46,370,352 98.45%

46,393,422 46,183,534 99.55%

48,431,824 48,156,387 99.43%

46,260,521 ----IN COLLECTION----

Principal Taxpayers(I)

Taxpayer Name Type of Property NS-MPG Inc ............................... Alcatel Lucent Building .........................

Agellan Warrenville LP ................... Real Property ...................................

BP-hnoco Oil Company ..................... Oil Company Corporate Campus ....................

Tellabs Inc .............................. Optical Solutions ...............................

Ondeo Nalco Center ....................... Water Treatment Center ..........................

Amli Residential .........................

Real Property ...................................

ING Clarion .............................. Real Property ...................................

UBS Realty Investors LLC ................. Real Property ...................................

BMO Harris Bank Corp. Re ................. Real Property ...................................

TGM McDowell Place LLC ................... Apartment Complex ............................... Total ...................................................................................

10 Largest Taxpayers as Percent of Total ................................................

2015 EAV (2)

$ 29,394,820

16,644,500

16,541,090

15,189,280

14,392,340

14,225,244 14,119,240

12,860,110 12,519,660

11,838,820 $157,725,104

2.51%

Notes: (1)

(2)

Source: DuPage and Will County Clerks.

Every effort has been made to seek out and report the largest taxpayers. However, many of the

taxpayers listed contain multiple parcels and it is possible that some parcels and their

valuations have been overlooked. The 2015 EAM is the most current available.

REAL PROPERTY ASSESSMENT, TAX LEVY AND COLLECTION PROCEDURES

Tax Levy and Collection Procedures

Local assessment officers determine the assessed valuation of taxable real property and railroad property not

held or used for railroad operations. The Illinois Department of Revenue (the "Department") assesses certain other

types of taxable property, including railroad property held or used for railroad operations. Local assessment officers'

valuation determinations are subject to review at the county level and then, in general, to equalization by the

Department. Such equalization is achieved by applying to each county's assessments a multiplier determined by the

Department. The purpose of equalization is to provide a common basis of assessments among counties by adjusting assessments toward the statutory standard of 33-1/3 % of fair cash value. Farmland is assessed according to a statutory formula which takes into account factors such as productivity and crop mix. Taxes are extended against the assessed

values after equalization.

15



Property tax levies of each taxing body are filed in the office of the county clerk of each county in which

territory of that taxing body is located. The county clerk computes the rates and amount of taxes applicable to taxable

property subject to the tax levies of each taxing body and determines the dollar amount of taxes attributable to each

respective parcel of taxable property. The county clerk then supplies to the appropriate collecting officials within the

county the information needed to bill the taxes attributable to the various parcels therein. After the taxes have been

collected, the collecting officials distribute to the various taxing bodies their respective shares of the taxes collected.

Taxes levied in one calendar year are due and payable in two installments during the next calendar year. Taxes that are

not paid when due, or that are not paid by mail and postmarked on or before the due date, are subject to a penalty of

1-1/2% per month until paid. Unpaid property taxes, together with penalties, interest and costs, constitute a lien

against the property subject to the tax.

Exemptions

An annual General Homestead Exemption provides that the EAV of certain property owned and used for

residential purposes ("Residential Property") may be reduced by the amount of any increase over the 1977 EAV, up to

a maximum reduction of $6,000 for tax year 2012 and thereafter.

The Homestead Improvement Exemption applies to Residential Properties that have been improved or rebuilt in

the 2 years following a catastrophic event. The exemption is limited to $45,000 through December 31, 2003, and

$75,000 per year beginning January 1, 2004 and thereafter, to the extent the assessed value is attributable solely to such

improvements or rebuilding.

The Senior Citizens Homestead Exemption annually reduces the EAV on residences owned and occupied by senior citizens. Beginning with tax year 2013, the maximum exemption is $5,000.

A Senior Citizens Assessment Freeze Homestead Exemption freezes property tax assessments for homeowners,

who are 65 and older and receive a household income not in excess of the maximum income limitation. The maximum

income limitation is $35,000 for years prior to 1999, $40,000 for assessment years 1999 through 2003, $45,000 for

assessment years 2004 and 2005, $50,000 from assessment years 2006 and 2007 and for assessments year 2008 and

after, the maximum income limitation is $55,000. In general, the Senior Citizens Assessment Freeze Homestead

Exemption limits the annual real property tax bill of such property by granting to qualifying senior citizens an

exemption as to a portion of the valuation of their property. For those counties with a population of less than

3,000,000, the Senior Citizens Assessment Freeze Homestead Exemption is as follows: through assessment year 2005

and for assessment year 2007 and later, the exempt amount is the difference between (i) the current EAV of their

residence and (ii) the base amount, which is the EAV of a senior citizen's residence for the year prior to the year in

which he or she first qualifies and applies for the Exemption (plus the EAV of improvements since such year). For

assessment year 2006, the amount of the Senior Citizens Assessment Freeze Homestead Exemption phases out as the

amount of household income increases. The amount of the Senior Citizens Assessment Freeze Homestead Exemption is

calculated by using the same formula as above, and then multiplying the resulting value by a ratio that varies according to household income.

The Natural Disaster Homestead Exemption (the "Natural Disaster Exemption") applies to homestead

properties containing a residential structure that has been rebuilt following a natural disaster occurring in taxable year

2012 or any taxable year thereafter. A natural disaster is an occurrence of widespread or severe damage or loss of

property resulting from any catastrophic cause including but not limited to fire, flood, earthquake, wind, or storm. The

Natural Disaster Exemption is equal to the equalized assessed value of the residence in the first taxable year for which

the taxpayer applies for the exemption minus the base amount. To be eligible for the Natural Disaster Exemption, the

residential structure must be rebuilt within two years after the date of the natural disaster, and the square footage of the

rebuilt residential structure may not be more than 110% of the square footage of the original residential structure as it

existed immediately prior to the natural disaster. The Natural Disaster Exemption remains at a constant amount until

the taxable year in which the property is sold or transferred.

16



Another exemption available to disabled veterans operates annually to exempt up to $100,000 of the assessed

valuation of property owned and used exclusively by such veterans or their spouses for residential purposes. Also, certain property is exempt from taxation on the basis of ownership and/or use, such as public parks, not-for-profit schools and public schools, churches, and not-for-profit hospitals and public hospitals. However, individuals claiming exemption under the Disabled Persons' Homestead Exemption or the Disabled Veterans Standard Homestead

Exemption cannot claim the aforementioned exemption.

Furthermore, beginning with assessment year 2007, the Disabled Persons' Homestead Exemption provides an

annual homestead exemption in the amount of $2,000 for property that is owned and occupied by certain persons with a

disability. However, individuals claiming exemption as a disabled veteran or claiming exemption under the Disabled

Veterans Standard Homestead Exemption cannot claim the aforementioned exemption.

In addition, the Disabled Veterans Standard Homestead Exemption provides disabled veterans an annual

homestead exemption starting with assessment year 2015 and thereafter. Specifically, (i) those veterans with a service-

connected disability of 30 % or more but less than 50% are granted an exemption of $2,500, (ii) those veterans with a

service-connected disability of 50% or more but less than 70% are granted an exemption of $5,000 and (iii) if the

veteran has a service-connected disability of 70% or more then the property is exempt from taxation under the code.

Furthermore, the veteran's surviving spouse is entitled to the benefit of the exemption, provided that the spouse has

legal or beneficial title of the homestead, resides permanently on the homestead and does not remarry. However, individuals claiming exemption as a disabled veteran or claiming exemption under the Disabled Persons' Homestead

Exemption cannot claim the Disabled Veterans Standard Homestead Exemption.

Beginning with assessment year 2007, the Returning Veterans' Homestead Exemption is available for property owned and occupied as the principal residence of a veteran in the assessment year the veteran returns from an armed

conflict while on active duty in the United States armed forces. This provision grants a homestead exemption of

$5,000, which is applicable in all counties. In order to apply for the Returning Veterans' Homestead Exemption, the

individual must pay real estate taxes on the property, own the property or have either a legal or an equitable interest in

the property, "or a leasehold interest of land on which a single family residence is located, which is occupied as a

principle residence of a veteran returning from an armed conflict involving the armed forces of the United States who

has an ownership interest therein, legal, equitable or as a lessee, and on which the veteran is liable for the payment of

property taxes." Those individuals eligible for the Returning Veterans' Homestead Exemption may claim the Returning Veterans' Homestead Exemption, in addition to other homestead exemptions, unless otherwise noted.

Property Tax Extension Limitation Law

The Property Tax Extension Limitation Law (the "Limitation Law") limits the amount of the annual increase in

property taxes to be extended for certain Illinois non-home rule units of government. In general, the Limitation Law

restricts the amount of such increases to the lesser of 5 % or the percentage increase in the Consumer Price Index during the calendar year preceding the levy year. Currently, the Limitation Law applies only to and is a limitation upon all

non-home rule taxing bodies in Cook County, the five collar counties (DuPage, Kane, Lake, McHenry and Will) and

several downstate counties.

Home rule units, including the City, are exempt from the limitations contained in the Limitation Law. If the

Limitation Law were to apply in the future to the City, the limitations set forth therein will not apply to any taxes levied

by the City to pay the principal of and interest on the Bonds. See "DESCRIPTION OF THE BONDS" herein.

17



Illinois legislators have introduced several proposals to modify the Limitation Law, including freezing property taxes and extending tax caps to all taxing bodies (including home rule units) in the State (the "Property Tax Freeze

Proposal"). Specifically, Senate Bill 318 passed the Illinois Senate on August 4, 2015. This legislation includes,

among other items, a State-wide property tax freeze for levy years 2016 and 2017 for taxing districts located in counties

other than Cook County and levy years 2017 and 2018 for taxing districts located in Cook County. If the Property Tax

Freeze Proposal or similar legislation were to become law, such reform may have a impact on the finances of the City and the ability of the City to issue non-referendum bonds. The City cannot predict whether, or in what form, any

change to the Limitation Law, including the Property Tax Freeze Proposal, may be enacted into law, nor can the City predict the effect of any such change on the City's finances.

Truth in Taxation Law

Legislation known as the Truth in Taxation Law (the "Law") limits the aggregate amount of certain taxes which

can be levied by, and extended tbr, a taxing district to 105 % of the amount of taxes extended in the preceding year

unless specified notice, hearing and certification requirements are met by the taxing body. The express purpose of the

Law is to require published disclosure of, and hearing upon, an intention to adopt a levy in excess of the specified levels.

FINANCIAL INFORMATION

Investment and Cash Management Policy

The City has adopted a comprehensive Investment and Cash Management Policy (the "Policy") addressing the

administration of all funds except those restricted by specific ordinances. Examples of funds not subject to the Policy are debt service and reserve funds which are subject to limitations set forth in the bond ordinances authorizing the

issuance of the related bonds.

The City Manager has delegated the responsibility of management of the Policy to the Director of Finance. In

addition the Financial Advisory Board (the "FAB") which is appoimed by the City Council will undertake specific tasks

such as reviewing the Policy as assigned by the Mayor and City Council. The Director of Finance provides an

investment report to FAB quarterly.

The City's investment objective as summarized in the Policy is to preserve capital, provide liquidity, and

maximize investment income. Further, the Policy establishes a standard of prudence which states the "Investments

shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and

intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the

probable safety of their capital as well as the probable income to be derived."

The city contracts with financial institutions to provide investments. In order to protect the City from the

failure of any financial institutions, the City requires full collateralization of all City investments in accordance with the

City's collateral agreement. The objective with all investments is to maximize returns. In order to maximize returns,

funds should be kept at the money managers and only a minimum amount of cash should be on hand. The minimum

amount of cash will be used to provide adequate short term funding for payroll and accounts payable. However, the

maximum that will be held is $22 million.

The Policy requires that liquidity in the portfolio be maintained to meet operating needs based on cash

forecasts. Repurchase agreements can be used to provide liquidity and maintain investment returns. The maximum

maturity for the City investments shall be twenty years, except for CMO's whose average life may not exceed ten years

at 100 PSA. The average maturity of the total portfolio shall not exceed five years, unless otherwise recommended by the professional investment advisors.

18



Financial Reports

The City's financial statements are audited annually by certified public accountants. The City's financial

statements are completed on a modified accrual basis of accounting consistent with generally accepted accounting principles applicable to governmental entities. See APPENDIX A for more detail.

No Consent or Updated Information Requested of the Auditor

The tables contained in this "FINANCIAL INFORMATION" section (the "Excerpted Financial Information") are from the audited financial statements of the City, including the audited financial statements for the fiscal year ended

April 30, 2015 (the "2015 Audit"), which was approved by formal action of the City Council and attached to this Final

Official Statement as APPENDIX A. The City has not requested the Auditor to update information contained in the

Excerpted Financial Information or the 2015 Audit; nor has the City requested that the Auditor consent to the use of the

Excerpted Financial Information or the 2015 Audit in this Final Official Statement. Other than as expressly set tbrth in

this Final Official Statement, the financial intbrmation contained in the Excerpted Financial Information and 2015 Audit

has not been updated since the date of the 2015 Audit. The inclusion of the Excerpted Financial Information and 2015

Audit in this Final Official Statement in and of itself is not intended to demonstrate the fiscal condition of the City since

the date of the 2015 Audit. Questions or inquiries relating to financial information of the City since the date of the

2015 Audit should be directed to the City.

Summary Financial Information

The following tables are summaries and do not purport to be the complete audits, copies of which are available

upon request. See APPENDIX A for the City's 2015 Audit.

19



Statement of Net Assets/Position

Governmental Activities

(Amounts Expressed in 000's)

ASSETS:

Cash and Investments .........................

Receivables, net .............................

Due from Other Governments ...................

Due from Other Funds .........................

Internal Balances ............................

Inventories ..................................

Prepaids .....................................

Net Pension Assets ...........................

Capital Assets Not Being Depreciated .........

Capital Assets Being Depreciated, Net of

Depreciation ................................

Total Assets ...............................

DEFERRED OUTFLOWS OF RESOURCES

Unamortized loss on refunding ................

Total Deferred Outflows or Resources .......

Total Assets and Deferred Outflows of

Resources .................................

LIABILITIES:

Accounts Payable .............................

Accrued Interest Payable .....................

Due to Other Governments .....................

Unearned Revenue .............................

Long Term Liabilities:

Due Within One Year .........................

Due In More Than One Year ...................

Total Liabilities ............................

DEFERRED INFLOWS OF RESOURCES

Property Taxes ...............................

Total Deferred Inflows or Resources ........

Total Liabilities and Deferred Inflows of

Resources .................................

NET POSITION:

Invested in Capital Assets, Net of Related Debt

Restricted ...................................

Unrestricted .................................

Total Net Position .........................

Audited As of April 30

2011 2012 2013 2014 2015

$ 64,121 $ 61,820 $ 65,306 $ 65,754 $ 64,196

42,120 40,345 37,829 37,138 38,612

13,878 15,380 12,864 12,051 12,076

0 0 0 0 3,366

(698) (688) (44) 514 (5)

318 294 355 368 331

1,185 1,057 0 0 0

1.542 1,600 1,645 7.678 8,702

239.759 236,603 239,527 244.170 253.460

263,323

$630,996

$ 1.413

1,413

312,058 294,286 277,534 $674,283 $650,697 $635,016

$ 0 $ 0 $ 1,560

0 0 1,560

$674.283 $650,697 $636,576 $632,409

250,852 $631,590

$ 1,267

1,267

$632,857

$ 17,741 $ 16,328 $ 20,370 $ 25,726 $ 20,321

1,749 1,680 1,459 1,475 1,678

259 203 223 827 141

39,997 37,291 0 0 3,116

12.943 15,292 12,669 12,460 15,225

118,887 105,996 100,692 100,004 108,800 $191,576 $176.790 $135.413 $140,492 $149,281

$ 32,584 $ 0 $ 0 $ 33, 392

0 0 33,392

$191,576 $176,790 $168,805

32,584

$173,076

$ 34,397

34,397

$183,678

$446,569 $427. 459 $419,148 $412, 387 $409,027 5. 129 6,031 6, 787 8,042 9,623

31,009 40, 417 41,836 38, 904 30, 529

•482 r 707 $473 r

907 :•467,771 •;459.333 •449, 179

20



Statement of Activities

Net (Expenses) Revenues and Changes in Net Assets

Functions/Programs

Primary Government

(Amounts Expressed in 000's)

Governmental Activities(I) General Government

...........................

Physical Environment .........................

Public Safety ................................

Culture and Recreation .......................

Transportation ...............................

Interest on Long Term Debt ...................

Total Governmental Activities ..............

Audited for the Fiscal Year Ending April 30

2011 2012 2013 2014 2015

$ (2, 102) $ (5, 203) $ (6, 377) $ (7, 384)

(5,499) (6,528) (6,287) (5,998) (53, 967) (56,046) (55, 385) (57,982)

(9, 809) (7, 605) (7,484) (8, 776)

(31,422) (42,246) (40, 162) (40, 409)

(4, 156) (4, 308) (3, 952) (3, 590)

$(106,955) $(121,936) $ (119, 647) $(124,139)

$ (7, 680)

(5, 742)

(60, 050)

(7, 804)

(36, 837)

(3,991) $ (122, 104)

General Revenues

Taxes

Property .................................... $ 39,464 $ 38,479 $ 36,227 $ 33,639 Utility ..................................... 16,390 16,580 16,604 16,993 Sales and Use

............................... 28,600 30,610 32,263 34,498 State Income

................................ 11,271 11,581 12,784 13,823 Other

...................................... 10,592 10,677 12,006 13,391 Franchise Fees

............................... 2,020 2,141 2,437 2,455 Investment Income

............................ 2,766 3,130 1,190 (293) Transfers In (Out) ........................... (61) (62) 0 0

Total ...................................... $ 113,136 $ 113,511 $ 111,042 $ 114,506

$ 33,169

16,123

35,580 13,892

13,300 2, 538

1,925

(4, 577)

$ 111,950

Change in Net Position ....................... $ 4,087 $ (8,800) $ (6,136) $ (9,633) $ (10,154)

Net Position, May 1 ..........................

Net Position, April 30 .......................

$ 478, 620 :• 482, 707 $ 473, 907 $ 468, 966 (2) $ 459, 333

•; 482,707 •; 473r907 • 467,771 •, 459r333 :• 449T179

Notes:. (1) Expenses less program revenues of Charges for Services, Operating Grants and Capital Grants.

(2) As restated.

21



General Fund

Balance Sheet

(Amounts Expressed in O00's)

ASSETS:

Cash and Investments .........................

Receivables:

Property Taxes ..............................

Accrued Interest ............................

Accounts Receivable .........................

Customers:

Billed ......................................

Unbilled, estimated .........................

Less allowance for doubtful accounts .......

Inventory ....................................

Loans and Installments .......................

Due from Other Funds .........................

Due from Other Governments ...................

Total Assets ...............................

LIABILITIES:

Accounts Payable .............................

Acorued Wages and Benefits ...................

Due to Other Governmental Agencies ...........

Deposits .....................................

Other Payables ...............................

Total Liabilities ............................


Property Taxes ...............................

Total deferred inflows of resources ........

Total liabilities and deferred inflows of

Resources .................................

Fund Balance:

Assigned ....................................

Nonspendable ................................

Unassigned ..................................

Total Fund Balance .........................

Total Liabilities, Deferred Inflows and

Fund Balance ..............................

2011 2012

Audited as of April 30

2013

$16,486 $20,420 $27,401

2014

$23,688

2015

$21,818

24,148 20,395 21,086 18,959 17,515

53 56 86 81 82

2,309 1,967 2,330 2,660 2,585

291 311 316 389 553

540 555 587 568 442

(1,803) (1,221) (682) (98) (54) 41 12 15 27 331

1,891 1,294 727 48 12

1,394 519 630 192 3,984

11,038 13,181 11,005 11,407 11,315

• • • $58,58___•3

$ 2,854 $ 2,678 $ 2,652 $ 3,584 $ 3,610

2,452 2,980 3,320 3,909 4,080

137 136 166 619 129

3,823 4,132 4,543 4,909 3,944

43 9 3 353 1

$ 9,309 $ 9,935 $10,684 $13,374 $11,764

$24,148 $20,395 $21,086 $18,959 $17,515 24,148 20,395 21,086 18,959 17,515

$33,457 $30,330 $31,770 $32,333 $29,279

$ 0 $ 0

75 343

25,513 28,961

}25,588 $29,304

$ 0 $ 0

149 122

22,782 27,037

•22, 931 •27, 159

$ 6,000

158

25,573

•31,731

22

C3"ty of Naperville, DuPage and Will Counties, Illinois


General Fund

Revenues and Expenditures (Amounts Expressed in O00's)

REVENUES:

Property Taxes ...............................

Utility Tax ..................................

Sales and Use Tax ............................

State Income Tax .............................

Other Taxes ..................................

Licenses and Permits .........................

Fines and Forfeits ...........................

Investment Income ............................

Intergovernmental ............................

Charges for Services .........................

Fees .........................................

Miscellaneous ................................

Total Revenues .............................

EXPENDITURES:

General Government ...........................

Physical Environment .........................

Publi¢ Safety ................................

Culture and Recreation .......................

Transportation ...............................

Total Expenditures ...........................

Excess (Deficiency) of Revenues

Over Expenditures ..........................

Other Financing Sources (Uses):

Transfers In (Out), net ......................

Total Other Financing Sources (uses) .......

Net Change in Fund Balance ...................

Beginning Fund Balance .......................

Ending Fund Balance ..........................

2011

Audited for the Fiscal Year Ending April 30

2012 2013 2014 2015

$ 25,928 $ 24,242 $ 20,450 $ 20,964 $ 19,091

16,390 16,580 16,604 16,993 16,123

28,600 30,610 32,263 34,498 35,580

11,271 11,581 12,784 13,823 13,892

4,694 4,508 5,628 6,885 7,170

1,591 1,881 2,262 2,377 2,480

3,061 2,487 1,647 1,626 1,672 716 955 402 (155) 447

629 607 704 569 968

6,181 6,549 6,593 7,103 8,054

2,349 2,520 2,684 2,807 2,992

2,149 993 1,037 907 626

$103,559 $103,513 $103,058 $108,397 $109,095

$ 5,269 $ 5,118 $ 6,130 $ 6,929 $ 7,196

8,151 8,113 7,958 8,085 7,996

61,613 61,594 60,614 70,156 67,841

1,642 2,022 1,697 1,866 1,805

19,515 18,919 18,798 21,567 24,148 $ 96,190 $ 95,766 $ 95,197 $108,603 $108,986

$ 7, 747 $ 7, 861 $ (206) $ 7,369 $ 109

(5,376) (3,519) (3,289) (5,937) 3,607 $ (5,376) $ (3,519) $ (3.289) $ (5,937) $ 3,607

$ 1,993 $ 4,228 $ 4,572 $ (6,143) $ 3.716

20,938 ,,

22,931 27,159 31,731 25,588 $ 22,931 $ 27,159 $ 31,731 $ 25,588 $ 29.304

23



General Fund

Preliminary Budget and Unaudited Financial Information(/)

Budgeted Unaudited Budgeted

Eight Months Eight Months Twelve Months

Ending Ending Ending

12/31/2015 12/31/2015 12/31/2016

REVENUES:

Retail Sales Tax .............................. $21,964,701 $22.058.715

Property Taxes ................................ 17,514,800 17,512,064

Utility Taxes ................................. 9.843.700 10.108.050

State Income Tax .............................. 10.411.300 10.513.318

Charges for Service .......................... 6.501.601 7.010.502

Real Estate Transfer Tax ...................... 3.500.000 3.536.984

Other Taxes ................................... 1.754,318 2,079,537

Rental Income and Franchise Fees .............. 2.236.000 2.331.089

Internal Services and Transfers In ............ 2.918.302 1.924.496

Permits and Licenses .......................... 1,408,303 1.372.610

Fines and Fees ................................ 1,016,100 1.135.730

Food and Beverage Tax ......................... 630,000 627.511

Hotel/Motel Tax ............................... 771,701 852.737 Grants ........................................ 729.502 627,888

Other Revenues ................................ 208,002 291,433

Net Investment Income ......................... 281,200 (81,722) Total Revenues .............................. $81.689,530 $81.900,942

Operating Transfers In ........................ $ 11,802 $ 4,108 Total Revenues and lransfers In ............. $81,701,332 $81,905,050

EXPENDITURES:

Salaries and Wages ............................ $40. Benefits and Related .......................... 20,

Contracted Services ........................... 5,

Refuse Collection and Recycling ............... 4.

Supplies ...................................... 4,

Capital Outlay ................................ 1.

Internal Services .............................

Grants and Contributions to Others ............

Total Expenditures ............................ $78.

$ 33.874.500

20.712,569

16.370.000

14.500,000

12.455.950

4.600.000

3.166.000

3,079.400

2,984.133

2.478.086 1.664,800

1,470,000 1,270,000

714,325

441,500

235,500 $120,016,763

$ 75,000 $120.091.763

231,748 $40,738.822 $ 61,277,120

397,997 19.442,549 27,140,864

928,242 6,740.396 10,295,943

000,000 4.233.483 6.563,084

269.799 4,683,871 7.366.604

665,597 1,260,383 1,398,400

755,703 (532,956) (561,440)

970,499 885,639 1,584,909 219,585 $77,452,187 $115,065,484

Operating Transfer Out ........................ 5,343,943 5,343,943 Total Expenditures and Transfers Out

........ $83,563,528 $82.796,130

Revenues over (Under) Expenditures and Transfers ..............................

Note: (1) Source: The City.

5,018,617 $120,084,101

$(1,862. 196) $ (891,080) $ 7,662

Transition to a Calendar Year

The City has transitioned to a calendar year end, beginning with December 31, 2015. The budgeted figures

reported for the year ended December 31, 2015 represent the eight month period beginning after the City's previous fiscal year end date of April 30, 2015.

24

City of Naperville, DuPage and Will Counties, lllinois


EMPLOYEE RETIREMENT AND OTHER POSTEMPLOYMENT BENEFITS OBLIGATIONS

See APPENDIX D herein for a discussion of the City's employee retirement and other postemployment benefits obligations.

REGISTRATION, TRANSFER AND EXCHANGE

Registration and Record Date

The registered owner of a Bond will be deemed and regarded as the absolute owner thereof for the purpose of

receiving payment of, or on account of, the principal of, premium, if any, or interest theron and for all other purposes

whatsoever, and all such payments so made to such registered owner or upon his order shall be valid and effectual to

satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the City nor the

Bond Registrar will be affected by any notice to the contrary.

Interest on the Bonds will be paid to the registered owners of the Bonds appearing on the registration books of

the Bond Registrar as of the close of business on the 15 •h

day of the calendar month next preceding an interest payment date (the "Record Date").

Transfers and Exchanges

The transfer of Bonds will be registrable only upon the registration books maintained by the City for that

purpose at the principal corporate trust office of the Bond Registrar, by the registered owner thereof or by his attorney

duly authorized in writing, upon surrender thereof together with an instrument of transfer satisfactory to the Bond

Registrar and duly executed by the registered owner or his duly authorized agent. Upon such surrender for registration of transfer, the City will execute and the Bond Registrar will authenticate and deliver a new Bond or Bonds of any

authorized denominations, registered in the name of the transferee, and of the same aggregate principal amount,

maturity and interest rate as the surrendered Bond.

Bonds may be exchanged for an equal aggregate principal amount of Bonds of the same maturity and interest

rate and of any authorized denominations, upon surrender thereof as the principal corporate trust office of the Bond

Registrar with a written instrument of transfer satisfactory to the Bond Registrar, duly executed by the registered owner

or his duly authorized agent.

For every such exchange or registration of transfer of Bonds, the City or the Bond Registrar may make a

charge sufficient to reimburse it for any tax or other governmental charge required to be paid with respect to such

exchange or registration of transfer. No charge will be made in connection with such exchange or registration of

transfer to pay the cost of preparing each new Bond issued upon such exchange or registration of transfer.

25



TAX EXEMPTION

Summary of Bond Counsel Opinion

Katten Muchin Rosenman LLP, Bond Counsel, is of the opinion that under existing law, interest on the Bonds

is not includible in the gross income of the owners thereof for Federal income tax purposes. If there is continuing compliance with the applicable requirements of the Internal Revenue Code of 1986 (the "Code"), Bond Counsel is of

the opinion that interest on the Bonds will continue to be excluded from the gross income of the owners thereof for

Federal income tax purposes. Bond Counsel is further of the opinion that the Bonds are not "private activity bonds"

within the meaning of Section 141(a) of the Code. Accordingly, interest on the Bonds is not an item of tax preference for purposes of computing individual or corporate alternative minimum taxable income. However, interest on the Bonds

is includible in corporate earnings and profits and therefore must be taken into account when computing corporate alternative minimum taxable income for tax purposes of the corporate alternative minimum tax. Interest on the Bonds

is not exempt from State of Illinois income taxes.

The Code contains certain requirements that must be satisfied from and after the date of issuance of the Bonds.

These requirements relate to the use and investment of the proceeds of the Bonds, the payment of certain amounts to the

United States, the security and source of payment of the Bonds and the use of property financed with the proceeds of

the Bonds. The City has covenanted in the Bond Ordinance to comply with these requirements.

Bonds Purchased at a Premium or a Discount

The difference (if any) between the initial price at which a substantial amount of each maturity of the Bonds is

sold to the public (the "Offering Price") and the principal amount payable at maturity of such Bonds is given special treatment for Federal income tax purposes. If the Offering Price is higher than the maturity value of a Bond, the

difference between the two is known as "bond premium"; if the Offering Price is lower than the maturity value of a

Bond, the difference between the two is known as "original issue discount".

Bond premium and original issue discount are amortized over the term of a Bond on the basis of the owner's

yield from the date of purchase to the date of maturity, compounded at the end of each accrual period of one year or

less with straight line interpolation between compounding dates, as provided more specifically in the Income Tax

Regulations. The amount of bond premium accruing during each period is treated as a reduction in the amount of tax-

exempt interest earned during such period and is subtracted from the owner's tax basis in the Bonds The amount of

original issue discount accruing during each period is treated as interest that is excludable from the gross income of the

owner of such Bonds for Federal income tax purposes, to the same extent and with the same limitations as current

interest, and is added to the owner's tax basis in the Bonds. A Bond's adjusted tax basis is used to determine whether,

and to what extent, the owner realizes taxable gain or loss upon disposition of the Bonds (whether by reason of sale,

acceleration, redemption prior to maturity or payment at maturity of the Bonds).

Owners of Bonds should consult their own tax advisors with respect to the state and local tax consequences of

owning the Bonds. It is possible that under the applicable provisions governing the determination of state or local

income taxes, accrued interest on the Bonds may be deemed to be received in the year of accrual even though there will

not be a corresponding cash payment until a year later.

26



Exclusion From Gross Income Requirements

The Code sets forth certain requirements that must be satisfied on a continuing basis in order to preserve the

exclusion from gross income for Federal income tax purposes of interest on the Bonds. Among these requirements are

the following:

Limitations on Private Use. The Code includes limitations on the amount of Bonds proceeds that may be used

in the trade or business of, or used to make or finance loans to, persons other than governmental units.

Investment Restrictions. Except during certain "temporary periods," proceeds of the Bonds and investment

earnings thereon (other than amounts held in a reasonably required reserve or replacement fund, if any, or as

part of "minor portion") may generally not be invested in investments having a yield that is "materially higher" (1/8 of one percent) than the yield on the Bonds.

Rebate of Arbitrage Profit. Unless the City qualifies for one of several exemptions, earnings from the

investment of the "gross proceeds" of the Bonds in excess of the earnings that would have been realized if such

investments had been made at a yield equal to the yield on the Bonds are required to be paid to the United

States at periodic intervals. For this purpose, the term "gross proceeds" includes the original proceeds of the

Bonds, amounts received as a result of investing such proceeds, and amounts to be used to pay debt service on

the Bonds.

Covenants to Comply. The City has covenanted in the Bonds Ordinance to comply with the requirements of

the Code relating to the exclusion from gross income for Federal income tax purposes of interest on the Bonds.

Risks of Non-Compliance

In the event that the City fails to comply with the requirements of the Code, interest on the Bonds may become

includible in the gross income of the owners thereof for Federal income tax purposes retroactive to the date of issue. In

such event, the Bond Ordinance requires neither acceleration of payment of principal of, or interest on, the Bonds nor

payment of any additional interest or penalties to the owners of the Bonds.

Federal Income Tax Consequences

Pursuant to Section 103 of the Code, interest on the Bonds is not includible in the gross income of the owners

thereof for Federal income tax purposes. However, the Code contains a number of other provisions relating to the

treatment of interest on the Bonds which may affect the taxation of certain types of owners, depending on their

particular tax situations. Some of the potentially applicable Federal income tax provisions are described in general terms below. PROSPECTIVE PURCHASERS SHOULD CONSULT THEIR TAX ADVISORS CONCERNING THE

PARTICULAR FEDERAL INCOME TAX CONSEQUENCES OF THEIR OWNERSHIP OF THE BONDS.

27



CONTINUING DISCLOSURE

In the Bond Ordinance, the City has covenanted and agreed, for the benefit of the beneficial owners of the

Bonds, to provide certain financial information and operating data relating to the City within 210 days after the close of

the City's fiscal year (the "Annual Report"); and, in a timely manner not in excess of ten business days after the event,

to provide notices of the occurrence of certain enumerated events. The Annual Report will be filed by the City with the

Municipal Securities Rulemaking Board (the "MSRB") for disclosures on its Electronic Municipal Market Access

("EMMA") system. The information to be contained in the Annual Report will consist of the annual audited financial

statement of the City, and updated information with respect to the statements in the Final Official Statement contained

under the captions "Retailers' Occupation, Service Occupation and Use Tax", "DEBT INFORMATION", "PROPERTY ASSESSMENT AND TAX INFORMATION" and "FINANCIAL INFORMATION" (excluding Preliminary Budget and Unaudited Financial Information). Each annual audited financial statement will conform to

generally accepted accounting principles applicable to governmental units and will be prepared in accordance with

standards of the Governmental Accounting Standards Board. If the audited financial statement is not available, then an

unaudited financial statement will be included in the Annual Report and the audited financial statement will be filed

promptly after it becomes available. The notices of enumerated events and timely notice of any failure of the City to

file its Annual Report within the 210 day period will be filed by the City with the MSRB for disclosures on EMMA.

The City's undertaking with respect to enumerated events includes timely notice of the occurrence of any of the

following events with respect to the Bonds.

.

2.

3.

4.

5.

6.

,

8.

9.

10.

11.

12.

13.

14.

15.

Principal and interest payment delinquencies Non-payment related defaults, if material

Unscheduled draws on debt service reserves reflecting financial difficulties

Unscheduled draws on credit enhancements reflecting financial difficulties

Substitution of credit or liquidity providers, or their failure to perform Adverse tax opinions, the issuance by the Internal Revenue Service 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 security, or other material events affecting the tax

status of the security Modifications to the rights of security holders, if material

Debt calls, if material

Defeasances

Release, substitution or sale of property securing repayment of the securities, if material

Rating changes Tender offers

Bankruptcy, insolvency, receivership or similar event of the City* 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

Appointment of a successor or additional trustee or the change of name of a trustee, if material.

*This 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 Oty, 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 having supervision or jurisdiction over substantially all of the assets or business of the Oty.

28



The City has agreed to the foregoing undertakings in order to assist participating underwriters of the Bonds and

brokers, dealers and municipal securities dealers in complying with Securities and Exchange Commission Rule

15c2-12(b)(5) promulgated under the Securities Exchange Act of 1934. The City will provide the foregoing information for so long as Rule 15c2-12(b)(5) is applicable to the Bonds and the City remains an "obligated person" under the Rule with respect to the Bonds. No provision of the bond ordinance limits the remedies available to any

beneficial owner of the Bonds with respect to the enforcement of the continuing disclosure covenants of the City described above. Failure to comply with the continuing disclosure covenants will not constitute an event of default

under the Bond Ordinance.

The City may amend the continuing disclosure undertakings contained in the Bond Ordinance upon a change in

circumstances provided that (a) the change in circumstances arises from a change in legal requirements, law, or change in the identity, nature or status of the City or the type of business conducted by the City, (b) the undertakings, as

amended, would have complied with the requirements of Rule 15c2-12(b)(5) at the time of this offering, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances and (c) in the

opinion of nationally recognized bond counsel selected by the City, the amendment does not materially impair the

interests of the beneficial owners of the Bonds.

The City has failed to file certain financial information and operating data on a timely basis. While the audited

financial statements were prepared and completed in a timely manner, the City's comprehensive annual financial report ("CAFR") for fiscal years 2011 and 2012 were not filed on time with the MSRB for disclosure on EMMA. The fiscal

year 2011 filing was made on January 9, 2012, and the fiscal year 2012 filing was made on November 21, 2012.

OPTIONAL REDEMPTION

The Bonds due December 1, 2016-2025, inclusive, are non-callable. The Bonds due December 1, 2026-2035, are callable in whole or in part on any date on or after December 1, 2025, at a price of par plus accrued interest to the

redemption date. If less than all the Bonds are called, they shall be redeemed in such principal amounts and from such

maturities as determined by the District and within any maturity by lot.

LITIGATION

There is no litigation of any nature now pending or threatened restraining or enjoining the issuance, sale, execution or delivery of the Bonds, or in any way contesting or affecting the validity of the Bonds or any proceedings of the City taken with respect to the issuance or sale thereof. There is no litigation now pending, or to the knowledge of the City, threatened against the City that is expected to materially impact the financial condition of the City.

LEGAL MATTERS

Legal matters incident to the authorization, issuance and sale of the Bonds are subject to the unqualified approving opinion of Katten Muchin Rosenman LLP, Chicago, Illinois, Bond Counsel, whose approving opinion will

be delivered with the Bonds. Bond Counsel has reviewed the statements in this Final Official Statement appearing under the heading "TAX EXEMPTION" and is of the opinion that the statements contained under such heading are

accurate statements or summaries of the matters set forth therein and fairly present the information purported to be

shown. Except for the foregoing, however, Bond Counsel has not independently verified the accuracy or completeness of statements and information contained in the Final Official Statement and does not assume any responsibility of the

accuracy or completeness of such statements and information.

29



The opinion of Bond Counsel and the descriptions of the tax law contained in this Final Official Statement are

based on statutes, judicial decisions, regulations, rulings and other official interpretations of law in existence on the date

the Bonds are issued. There can be no assurance that such law or the interpretation thereof will not be changed or that

new provisions of law will not be enacted or promulgated at any time while the Bonds are outstanding in a manner that

would adversely affect the value or the tax treatment of ownership of the Bonds.

FINAL OFFICIAL STATEMENT AUTHORIZATION

This Final Official Statement has been authorized for distribution to prospective purchasers of the Bonds. All

statements, information, and statistics herein are believed to be correct but are not guaranteed by the consultants or by the City, and all expressions of opinion, whether or not so stated, are intended only as such.

INVESTMENT RATINGS

Standard & Poor's, a Division of the McGraw-Hill Companies, New York, New York ("S&P"), has assigned the Bonds an investment rating of "AAA (Stable Outlook)"; and Moody's Investors Service, New York, New York

("Moody's', and together with S&P, the "Rating Agencies") has assigned the Bonds an investment rating of "Aaa".

The City has supplied certain information and material concerning the Bonds and the City to the Rating Agencies, including certain information and materials which may not have been included in this Final Official Statement, as part of its application for investment ratings on the Bonds. A rating reflects only the views of the rating agency assigning such rating and an explanation of the significance of such rating may be obtained from such rating agency. Generally, a rating service bases its rating on such information and material, and also on such investigations, studies and

assumptions that it may undertake independently. There is no assurance that such ratings will continue for any given period of time or that they may not be lowered or withdrawn entirely by such rating service if, in its judgment, circumstances so warrant. Any such downward change in or withdrawal of any such rating may have an adverse effect

on the secondary market price of the Bonds. An explanation of the significance of the investment ratings may be

obtained from the Rating Agency: Standard & Poor's Corporation, 55 Water Street, New York, New York 10041,

telephone 212-438-2000 and Moody's Investors Service, 7 World Trade Center at 250 Greenwich Street, New York,

New York 10007, telephone 212-553-1658.

DEFEASANCE AND PAYMENT OF BONDS

If the City shall pay or cause to be paid to the registered owners of the bonds, the principal, premium, if any,

and interest due or to become due thereon, at the times and in the manner stipulated therein and in this ordinance, then

the pledge of taxes, securities and funds hereby pledged and the covenants, agreements and other obligations of the City to the registered owners and the beneficial owners of the bonds shall be discharged and satisfied.

Any bonds or interest installments appertaining thereto, whether at or prior to the maturity or the redemption date of such bonds, shall be deemed to have been paid if (1) in case any such bonds are to be redeemed prior to the

maturity thereof, there shall have been taken all action necessary to call such bonds for redemption and notice of such

redemption shall have been duly given or provision shall have been made for the giving of such notice, and (2) there

shall have been deposited in trust with a bank, trust company or national banking association acting as fiduciary for

such purpose either (i) moneys in an amount which shall be sufficient, or (ii) "Federal Obligations" as defined below,

the principal of and the interest on which when due will provide moneys which, together with any moneys on deposit with such fiduciary at the same time for such purpose, shall be sufficient, to pay when due the principal of, redemption

premium, if any, and interest due and to become due on said bonds on and prior to the applicable redemption date or

maturity date thereof.

30



The term "Federal Obligations" means (i) non-callable, direct obligations of the United States of America, (ii) non-callable and non-prepayable, direct obligations of any agency of the United States of America, which are

unconditionally guaranteed by the United States of America as to full and timely payment of principal and interest, (iii) non-callable, non-prepayable coupons or interest installments from the securities described in clause (i) or clause (ii) which are stripped pursuant to programs of the Department of the Treasury of the United States of America, or (iv)

coupons or interest installments stripped from bonds of the Resolution Funding Corporation.

UNDERWRITING

The Bonds were offered for sale by the City at a public, competitive sale on June 8, 2016. The best bid

submitted at the sale was submitted by Morgan Stanley, New York, New York (the "Underwriter"). The City awarded

the contract for sale of the Bonds to the Underwriter at a price of $65,126,911.70. The Underwriter has represented to

the City that the Bonds have been subsequently re-offered to the public initially at the yields or prices set forth in the

addendum to this Final Official Statement.

Morgan Stanley, parent company of Morgan Stanley & Co. LLC, an underwriter of the Bonds, has entered into

a retail distribution arrangement with Morgan Stanley Smith Barney LLC. As part of the distribution arrangement,

Morgan Stanley & Co. LLC may distribute municipal securities to retail investors through the financial advisor network

of Morgan Stanley Smith Barney LLC. As part of this arrangement, Morgan Stanley & Co. LLC may compensate

Morgan Stanley Smith Barney LLC for its selling efforts with respect to the Bonds.

MUNICIPAL ADVISOR

The City has engaged Speer Financial, Inc. as Municipal Advisor (the "Municipal Advisor") in connection with

the issuance and sale of the Bonds. The Municipal Advisor is an Independent Registered Municipal Advisor in

accordance with the rules of the Municipal Securities Rulemaking Board (the "MSRB"). The Municipal Advisor will

not participate in the underwriting of the Bonds. The financial information included in the Final Official Statement has

been compiled by the Municipal Advisor. Such information does not purport to be a review, audit or certified forecast

of future events and may not conform with accounting principles applicable to compilations of financial information.

The Municipal Advisor is not a firm of certified public accountants and does not serve in that capacity or provide accounting services in connection with the Bonds. The Municipal Advisor is not obligated to undertake any

independent verification of or to assume any responsibility for the accuracy, completeness or fairness of the information

contained in this Final Official Statement, nor is the Municipal Advisor obligated by the City's continuing disclosure

undertaking.

CERTIFICATION

We have examined this Final Official Statement dated June 8, 2016, for the $61,605,000 General Obligation Bonds, Series 2016, believe it to be true and correct and will provide to the purchaser of the Bonds at the time of

delivery a certificate confirming to the purchaser that to the best of our knowledge and belief information in the was at

the time of acceptance of the bid for the Bonds and, including any addenda thereto, was at the time of delivery of the

Bonds true and correct in all material respects and does not include any untrue statement of a material fact, nor does it

omit the statement of any material fact required to be stated therein, or necessary to make the statements therein, in the

light of the circumstances under which they were made, not misleading.

/s/ STEVE CHIRICO /s/

Mayor CITY OF NAPERVILLE


RACHEL MAYER

Finance Director Treasurer

CITY OF NAPERVILLE


31

APPENDIX A

CITY OF NAPERVILLE, DUPAGE AND WILL COUNTIES, ILLINOIS

FISCAL YEAR APRIL 30, 2015 AUDITED FINANCIAL STATEMENTS

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APPENDIX B

DESCRIBING BOOK-ENTRY-ONLY ISSUANCE

1. The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for

the Bonds (the "Securities"). The Securities will be issued as fully-registered securities registered 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 Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC.

2. DTC, the world's largest securities 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 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.

3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which

will receive a credit for the Securities on DTC's records. The ownership interest of each actual purchaser of each

Security ("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 Securities are to be accomplished by entries made on the books of Direct and Indirect

Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their

ownership interests in Securities, except in the event that use of the book-entry system for the Securities is

discontinued.

4. To facilitate subsequent transfers, all Securities 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 Securities with DTC and their registration in the name of Cede & Co.

or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual

Beneficial Owners of the Securities; DTC's records reflect only the identity of the Direct Participants to whose accounts

such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will

remain responsible for keeping account of their holdings on behalf of their customers.

B-1

5. Conveyance 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 Securities may wish to take certain steps to augment the transmission to them of notices of

significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to

the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities 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 registrar and request that copies of notices be

provided directly to them.

6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being

redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be

redeemed.

7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to

Securities 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 Securities are credited

on the record date (identified in a listing attached to the Omnibus Proxy).

8. Redemption proceeds, distributions, and dividend payments on the Securities 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

Paying Agent, on payable date in accordance with their respective holdings shown on DTC's records. Payments by

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 Participant and not of DTC, the Paying Agent, 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 dividend

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 Paying Agent, 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.

9. A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its

Participant, to any Tender/Remarketing Agent, and shall effect delivery of such Securities by causing the Direct

Participant to transfer the Participant's interest in the Securities, on DTC's records, to any Tender/Remarketing Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will

be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC's records

and followed by a book-entry credit of tendered Securities to any Tender/Remarketing Agent's DTC account.

10. DTC may discontinue providing its services as depository with respect to the Securities at any time by

giving reasonable notice to the City or the Paying Agent. Under such circumstances, in the event that a successor

depository is not obtained, Security certificates are required to be printed and delivered.

11. The City may decide to discontinue use of the system of book-entry-only transfers through DTC (or a

successor securities depository). In that event, Security certificates will be printed and delivered to DTC.

12. The information in this section concerning DTC and DTC's book-entry system has been obtained from

sources that the City believes to be reliable, but the City takes no responsibility for the accuracy thereof.

B-2

APPENDIX C

PROPOSED FORM OF OPINION OF BOND COUNSEL

[TO BE DATED CLOSING DATE]

June 22, 2016

The City Council of the

City of Naperville, Illinois

Dear Members:

We have examined a record of proceedings relating to the issuance of $61,605,000 principal amount of General Obligation Bonds, Series 2016 (the "Bonds"), of the City of Naperville, a municipal corporation and a home rule unit of the State of Illinois. The Bonds are authorized and issued pursuant to the

provisions of Section 6 of Article VII of the Illinois Constitution of 1970 and the City of Naperville Municipal Code and by virtue of an ordinance adopted by the City Council of the City on May 17, 2016 and entitled:

"Ordinance Authorizing the Issuance of Not to Exceed $68,000,000 General Obligation Bonds of 2016 of the

City of Naperville, Illinois" (the "Bond Ordinance").

The Bonds are issuable in the form of fully registered bonds in the denominations of $5,000 or

any integral multiple thereof. Bonds delivered on original issuance are dated June 22, 2016. The Bonds mature

on December 1 in each of the following years in the respective principal amount set opposite each such year in

the following table, and the Bonds maturing in each such year bear interest from their date payable on

December 1, 2016 and semiannually thereafter on each June 1 and December 1 at the respective rate of interest

per annum set forth opposite such year:

Year Principal Amount Interest Rate

2016 $ 260,000 2.00%

2017 515,000 2.00

2018 3,855,000 2.00

2019 7,025,000 2.00

2020 6,385,000 2.00

2021 5,220,000 2.00

2022 5,540,000 2.00

2023 5,550,000 3.00

2024 5,975,000 3.00

2025 4,785,000 3.00

2026 3,800,000 3.00

2027 2,925,000 3.00

2028 3,170,000 3.00

2029 1,135,000 3.50

2030 775,000 3.50

2031 935,000 3.50

2032 970,000 3.50

2033 995,000 3.50

2034 1,030,000 3.50

2035 760,000 3.50

C-1

The Bonds maturing on or after December 1, 2026, are subject to redemption prior to maturity at

the option of the City, in such principal amounts and from such maturities as the City shall determine and by lot

within a single maturity, on December 1, 2025 and on any date thereafter, at a redemption price equal to the

principal amount thereof to be redeemed.

In our opinion, the Bonds are valid and legally binding general obligations of the City of

Naperville and the City is obligated to levy ad valorem taxes upon all the taxable property within the City for

the payment of the Bonds and the interest thereon without limitation as to rate or amount. However, the

enforceability of rights or remedies with respect to the Bonds may be limited by bankruptcy, insolvency or other

laws affecting creditors' rights and remedies heretofore or hereafter enacted.

We are of the opinion that under existing law, interest on the Bonds is not includable in the gross

income of the owners thereof for Federal income tax purposes. If there is continuing compliance with the

requirements of the Internal Revenue Code of 1986 (the "Code"), we are of the opinion that interest on the

Bonds will continue to be excluded from the gross income of the owners thereof for Federal income tax

purposes. We are further of the opinion that the Bonds are not "private activity bonds" within the meaning of

Section 141 (a) of the Code. Accordingly, interest on the Bonds is not an item of tax preference for purposes of

computing individual or corporate alternative minimum taxable income. However, interest on the Bonds is

includable in corporate earnings and profits and therefore must be taken into account when computing corporate alternative minimum taxable income for purposes of the corporate alternative minimum tax.

The Code contains certain requirements that must be satisfied from and after the date hereof in

order to preserve the exclusion from gross income for Federal income tax purposes of interest on the Bonds.

These requirements relate to the use and investment of the proceeds of the Bonds, the payment of certain

amounts to the United States, the security and source of payment of the Bonds and the use of the property financed with the proceeds of the Bonds. The City has covenanted in the Bond Ordinance to comply with these

requirements.

With respect to the exclusion from gross income for Federal income tax purposes of interest on

the Bonds, we have relied on the verification report of Grant Thornton LLP, certified public accountants,

regarding the computation of the arbitrage yield on the Bonds and of certain investments made with the

proceeds of the Bonds.

Interest on the Bonds is not exempt from Illinois income taxes.

Very truly yours,

C-2

APPENDIX D

EXCERPTS OF FISCAL YEAR 2015 AUDITED FINANCIAL STATEMENTS

RELATING TO THE CITY'S PENSION PLANS

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CITY OF NAPERVILLE, ILLINOIS

WATER STREET

TAX INCREMENT FINANCING DISTRICT FUND

REPORT ON COMPLIANCE

WITH PUBLIC ACT 85-1142

For the Year Ended

December 31, 2016

ATTACHMENTS K & LCITY OF NAPERVILLE WATER STREET TIF DISTRICTFY16 This report contains the acountant's reports on compliance for the fiscal year ended 12/31/16 and the prior eight month reporting ended 12/31/15.


WATER STREET


TABLE OF CONTENTS

Page(s)

INDEPENDENT ACCOUNTANT’S REPORT .............................................................. 1

INDEPENDENT AUDITOR’S REPORT ON SUPPLEMENTARY

INFORMATION .......................................................................................................... 2

SUPPLEMENTARY INFORMATION

Balance Sheet ............................................................................................................... 3

Statement of Revenues, Expenditures, and

Changes in Fund Balance ........................................................................................... 4

- 1 -

INDEPENDENT ACCOUNTANT’S REPORT

The Honorable Mayor

Members of the City Council

City of Naperville

400 South Eagle Street

Naperville, Illinois 60540

We have examined management’s assertion, included in its representation letter dated October 4,

2017 that the City of Naperville (the City) complied with the provisions of subsection (q) of

Section 11-74.4-3 of the Illinois Tax Increment Redevelopment Allocation Act (Illinois Public

Act 85-1142) during the year ended December 31, 2016. Management is responsible for the

City’s assertion and for compliance with those requirements. Our responsibility is to express an

opinion on management’s assertion about the City compliance based on our examination.

Our examination was conducted in accordance with attestation standards established by the

American Institute of Certified Public Accountants. Those standards require that we plan and

perform the examination to obtain reasonable assurance about whether management’s assertion

about compliance with the specified requirements is fairly stated, in all material respects. An

examination involves performing procedures to obtain evidence about whether management’s

assertion is fairly stated, in all material respects. The nature, timing, and extent of the procedures

selected depend on our judgment, including an assessment of the risks of material misstatement

of management’s assertion, whether due to fraud or error. We believe that the evidence we

obtained is sufficient and appropriate to provide a reasonable basis for our opinion.

Our examination does not provide a legal determination on the City of Naperville's compliance

with the specified requirements.

In our opinion, management’s assertion that the City of Naperville complied with the

aforementioned requirements for the year ended December 31, 2016 is fairly stated, in all

material respects.

This report is intended solely for the information and use of the Mayor, the City Council,

management of the City, Illinois State Comptroller’s Office and the joint review boards and is

not intended to be and should not be used by anyone other than these specified parties.

Naperville, Illinois

October 4, 2017

- 1 -

- 2 -

INDEPENDENT AUDITOR’S REPORT

ON SUPPLEMENTARY INFORMATION

The Honorable Mayor


City of Naperville



We have audited the financial statements of the governmental activities, the business-type

activities, the discretely presented component unit, each major fund, and the aggregate remaining

fund information of the City of Naperville, Illinois (the City) as of and for the year ended

December 31, 2016, which collectively comprise the basic financial statements of the City, and

have issued our report thereon dated, October 4, 2017, which expressed an unmodified opinion

on those statements.

Our audit was conducted for the purpose of forming an opinion on the financial statements as a

whole. The supplementary information (balance sheet, schedule of revenues, expenditures, and

changes in fund balance for the Water Street Tax Increment Financing (TIF) District Fund) is

presented for purposes of additional analysis and is not a required part of the financial

statements. Such information is the responsibility of management and was derived from and

relates directly to the underlying accounting and other records used to prepare the financial

statements.

The information has been subjected to the auditing procedures applied in the audit of the

financial statements and certain additional procedures, including comparing and reconciling such

information directly to the underlying accounting and other records used to prepare the financial

statements or to the financial statements themselves, and other additional procedures in

accordance with auditing standards generally accepted in the United States of America. In our

opinion, the information is fairly stated in all material respects in relation to the financial

statements as a whole.


October 4, 2017

- 2 -


BALANCE SHEET

WATER STREET


December 31, 2016

Cash and investments 5,208,587$

Receivables

Accrued interest 10,951

Property taxes 62,927

TOTAL ASSETS 5,282,465$

LIABILITIES

Accounts payable 192$

Deposits payable 57,558

Total liabilities 57,750


Unavailable revenue 62,927

Total deferred inflows of resources 62,927

FUND BALANCE

Restricted for

Economic development 5,161,788

Total fund balance 5,161,788

TOTAL LIABILITIES, DEFERRED INFLOWS

OF RESOURCES AND FUND BALANCE 5,282,465$

ASSETS

LIABILITIES, DEFERRED INFLOWS

OF RESOURCES AND FUND BALANCE

See accompany notes to financial statements.- 3 -


STATEMENT OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE

WATER STREET


For the Year Ended December 31, 2016

REVENUES

Taxes

Property 55,662$

Investment income 70,574

Total revenues 126,236

EXPENDITURES

Current

Economic development

Capital outlay 2,130,026

Professional services 18,202

Interest & fiscal charges 135,910

Total expenditures 2,284,138

EXCESS (DEFICIENCY) OF REVENUES

OVER EXPENDITURES (2,157,902)

OTHER FINANCING SOURCES (USES)

Transfers in -

Bond proceeds 6,870,000

Premium on bonds 473,338

Total other financing sources (uses) 7,343,338

NET CHANGE IN FUND BALANCE 5,185,436

FUND BALANCE, DECEMBER 31, 2015 (23,648)

FUND BALANCE, DECEMBER 31, 2016 5,161,788$



WATER STREET


FINANCIAL AND COMPLIANCE REPORT

For the Eight Months Ended

December 31, 2015


WATER STREET


TABLE OF CONTENTS

Page(s)

INDEPENDENT ACCOUNTANT’S REPORT .............................................................. 1

INDEPENDENT AUDITOR’S REPORT ON SUPPLEMENTARY

INFORMATION .......................................................................................................... 2

SUPPLEMENTARY INFORMATION

Balance Sheet ............................................................................................................... 3

Statement of Revenues, Expenditures, and

Changes in Fund Balance ........................................................................................... 4

- 1 -

INDEPENDENT ACCOUNTANT’S REPORT

The Honorable Mayor


City of Naperville



We have examined management’s assertion, included in its representation letter dated

November 15, 2016 that the City of Naperville (the City) complied with the provisions of

subsection (q) of Section 11-74.4-3 of the Illinois Tax Increment Redevelopment Allocation Act

(Illinois Public Act 85-1142) during the eight months ended December 31, 2015. Management is

responsible for the City’s assertion and for compliance with those requirements. Our

responsibility is to express an opinion on management’s assertion about the City compliance

based on our examination.

Our examination was conducted in accordance with attestation standards established by the

American Institute of Certified Public Accountants and, accordingly, included examining, on a

test basis, evidence about the City’s compliance with those requirements and performing such

other procedures as we considered necessary in the circumstances. We believe that our

examination provides a reasonable basis for our opinion. Our examination does not provide a

legal determination on the City’s compliance with statutory requirements.

In our opinion, management’s assertion that the City of Naperville complied with the

aforementioned requirements for the eight months ended December 31, 2015 is fairly stated, in

all material respects.

This report is intended solely for the information and use of the Mayor, the City Council,

management of the City, Illinois State Comptroller’s Office and the joint review boards and is

not intended to be and should not be used by anyone other than these specified parties.


November 15, 2016

- 1 -

- 2 -

INDEPENDENT AUDITOR’S REPORT

ON SUPPLEMENTARY INFORMATION

The Honorable Mayor


City of Naperville



We have audited the financial statements of the governmental activities, the business-type

activities, the discretely presented component unit, each major fund, and the aggregate remaining

fund information of the City of Naperville, Illinois (the City) as of and for the eight months

ended December 31, 2015, which collectively comprise the basic financial statements of the

City, and have issued our report thereon dated, November 15, 2016, which expressed an

unmodified opinion on those statements.

Our audit was conducted for the purpose of forming an opinion on the financial statements as a

whole. The supplementary information (balance sheet, schedule of revenues, expenditures, and

changes in fund balance for the Water Street Tax Increment Financing (TIF) District Fund) is

presented for purposes of additional analysis and is not a required part of the financial

statements. Such information is the responsibility of management and was derived from and

relates directly to the underlying accounting and other records used to prepare the financial

statements.

The information has been subjected to the auditing procedures applied in the audit of the

financial statements and certain additional procedures, including comparing and reconciling such

information directly to the underlying accounting and other records used to prepare the financial

statements or to the financial statements themselves, and other additional procedures in

accordance with auditing standards generally accepted in the United States of America. In our

opinion, the information is fairly stated in all material respects in relation to the financial

statements as a whole.


November 15, 2016

- 2 -


BALANCE SHEET

WATER STREET


December 31, 2015

Cash and investments 116,778$

Receivables

Property taxes 72,806

TOTAL ASSETS 189,584$

LIABILITIES

Accounts payable 140,426$

Total liabilities 140,426


Unavailable revenue 72,806

Total deferred inflows of resources 72,806

FUND BALANCE

Unrestricted

Unassigned (23,648)

Total fund balance (23,648)

TOTAL LIABILITIES, DEFERRED INFLOWS

OF RESOURCES AND FUND BALANCE 189,584$

ASSETS

LIABILITIES, DEFERRED INFLOWS

OF RESOURCES AND FUND BALANCE



STATEMENT OF REVENUES, EXPENDITURES, AND

CHANGES IN FUND BALANCE

WATER STREET


For the Eight Months Ended December 31, 2015

REVENUES

Taxes

Property 72,806$

Investment income (25,880)

Total revenues 46,926

EXPENDITURES

Current

Economic development

Capital outlay 7,315,884

Professional services 497,250

Total expenditures 7,813,134

EXCESS (DEFICIENCY) OF REVENUES

OVER EXPENDITURES (7,766,208)

OTHER FINANCING SOURCES (USES)

Transfers in 3,605,653

Total other financing sources (uses) 3,605,653

NET CHANGE IN FUND BALANCE (4,160,555)

FUND BALANCE, MAY 1 4,136,907

FUND BALANCE, DECEMBER 31 (23,648)$
