ERMU RES 07-02 RESOLUTION PROVIDING FOR THE SALE OF $3,590,000 GO WATER REVENUE REFUNDING BONDS, SERIES 2008A

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EXTRACT OF MINUTES OF A MEETING OF THE MUNICIPAL UTILITIES COMMISSION OF THE CITY OF ELK RIVER, MINNESOTA HELD: December 11, 2007 Pursuant to due call and notice thereof, a regular or special meeting of the Municipal Utilities Commission of the City of Elk River, Minnesota, was duly held at the office of the Municipal Utilities Commission in the City of Elk River, Minnesota on December 11, 2007, at 4:00 o'clock P.M. The following members were present: James Tralle, Jerome Takle, Jerry Gumphrey and the following were absent: none Member_James Tralle introduced the following resolution and moved its adoption: RESOLUTION CONCURRING IN THE ACTION OF THE CITY COUNCIL OF THE CITY OF ELK RIVER, MINNESOTA, IN PROVIDING FOR THE SALE OF $3,590,000 GENERAL OBLIGATION WATER REVENUE REFUNDING BONDS, SERIES 2008A BE IT RESOLVED by the Board of Commissioners of the Municipal Utilities Commission of the City of Elk River, Minnesota (the "Commission"), as follows: Section 1. Recitals. The City of Elk River, Minnesota (the "City") owns and operates a municipal water system (the "System") which is under the jurisdiction of the Municipal Utilities Commission of the City of Elk River, Minnesota (the "Commission"). On the date hereof, the City Council adopted a resolution providing for the sale of$3,590,000 General Obligation Water Revenue Refunding Bonds, Series 2008A (the "Bonds"). The City Council will, at a later date, adopt another resolution which will provide for the issuance of the Bonds. Proceeds of the Bonds will be used, pursuant to a current refunding, to refund $395,000 aggregate principal amount of the City's General Obligation Water Revenue Bonds, Series 1998B, dated December 1, 1998, and,pursuant to a crossover refunding, to refund $3,590,000 aggregate principal amount of the City's General Obligation Water Revenue Bonds, Series 2001A, dated October 1, 2001 (together, the "Refunded Bonds"). Proceeds of the Refunded Bonds were used to finance improvements to the System. Section 2. Refunding Purpose. The refunding of the Refunded Bonds, is consistent with covenants made with the holders thereof, and is necessary and desirable for the reduction of debt service cost to the City and thus to the Commission. Proceeds of the Bonds shall be expended on costs relating to the refunding of the Refunded Bonds and shall not be expended on or devoted to any other uses. Section 3. System Revenues Pledged. The Commission hereby acknowledges that the Refunded Bonds are and that the Bonds will be payable from the net revenues of the System. 2 u a205v 1