Board of Finance Regular Meeting Agenda (PDF)

FIFTEEN ROPE FERRY ROAD WATERFORD, CT 06385-2886
BOARD OF FINANCE
AGENDA
Waterford Town Hall June 8, 2022 mm
Regular Meeting 7:00 p.m. S
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1. Establishment of a quorum and call to order. 2 =
2. Public Comment. SS :
3. Approval and acceptance of minutes from May 18, 2022.
4. Board review and possible action on DRAFT BOF Policies.
a. Requesting New Capital Project Approval Outside the Budget Cycle Policy
b. Post-Issuance Compliance Procedures Policy
5. Annual review of Capital Projects and possible action.
6. Old Business:
7. New Business:
a. Discussion on FY22 Budget Hearing Process
b. Discussion of FY23 Audit and possible distribution of an Auditing Services RFP
8. Liaison Reports
9. Correspondence
a. Virginia Bielucki, Town Accountant, Revised Periodic Financial Statements FY22
dated May 9, 2022
b. Virginia Bielucki, Town Accountant, Status of General Fund Unassigned Balance
dated May 12, 2022

Board of Finance Agenda, June 8, 2022
Page 2
c. Virginia Bielucki, Town Accountant, Status of Contingency FY22 dated May 25,
2022.
d. Virginia Bielucki, Town Accountant, April 2022 Periodic Financial Statements FY22
dated May 9, 2022
e. Abbas Danesh, Town Treasurer, Update on Investing Policy.
10. Adjournment
Glenn Patterson, Chairman

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Board of Finance Wednesday May 18, 2022
Regular Meeting Minutes Waterford Town Hall
7:00 P.M,
Present: Chairman Glenn Patterson, Ronald Fedor, John Sheehan, Kevin Petchark, Joe Filippetti,
Robert Tuneski, Baird Welch-Collins
Elected: Robert Brule, First Selectman, Jody Nazarchyk, Selectwoman, Thomas Dembek - RTM,
Susan Driscoll —- RTM
Staff: Gary Schneider, Director of Public Works, Alan Wilensky, Tax Collector, Abby Piersall,
Planning Director.
1. Establishment of a quorum and call to order:
5.
A quorum and a call to order was established at 7:00 pm, on May 18, 2022
Public Comment: No Public Comment
Approval and acceptance of minutes from April 13, 2022.
Motion by John Sheehan, seconded by Joe Filippetti to approve the minutes of April 13,
2022 with one correction.
Vote — 5-0-2 Motion Passed
To consider and act on a request from Gary Schneider, Director of Public Works, for an
appropriation of $1,705,358 from the CNR Undesignated Fund #205-31520 to resurface the
following roads: Lakes Pond Road, Butlertown Road, Daniels Avenue, Niantic River Road {Partial}
and Gardiner’s Wood Road and forward to the RTM.
Motion by Ron Fedor, seconded by John Sheehan to approve the appropriation in the
amount of $1,705,358 from the CNR Undesignated Fund #205-31520.
Vote — Unanimous Motion Passed
To consider and act on a request from Alan Wilensky, Tax Collector, to review a list of tax
accounts to approve for transfer to suspense for the current fiscal year.
Motion by John Sheehan, seconded by Ron Fedor to approve the request as presented.
Vote — Unanimous Motion Passed
ZF.

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6. To consider and act on a request from Abby Piersall, Planning Director for an additional
appropriation request in the amount of $78,235.51 and forward on to the RTM.
Motion by Mr. Sheehan, seconded by Baird Welch-Collins was adjusted to read as
follows:
A Transfer from contingency in the amount of $78,236.00 be transferred into
line item 10118-5110, Building Department Administration, to fund a contractually
obligated retirement pay-out.
Vote: Unanimous Metion Passed
7. To consider and act on a request from Gary Schneider, Director of Public Works, to approve and
appropriate funds for a new project in the amount of $155,000 from Capital Non-Recurring line
#205-31520 for the Southwest School Underground Tank removal/Closure and forward on to
the RTM.
Public Works Director Schneider, Planning Director Piersall, and Town Attorney Avena informed
the Board regarding the history of the DEEP notice of Violation from 2018 and the circumstances
behind having to recently provide the DEEP an action plan to correct the problem in a timely
manner.
Motion by Baird Welch-Collins, seconded by Ron Fedor to approve the appropriation as
presented.
Vote: Unanimous Motion Passed
8. To consider and act on a request from Gary Schneider, Director of Public Works to approve and
appropriate funds for an emergency project in the amount of $10,000 from Capital Non-
Recurring line #205-31520 for a new heating oil tank installation at the Eugene O’Neill.
Director Schneider explained this was not an emergency funding request since DPW’s initial
response had addressed any safety concerns resulting from concerns about the buried oil tank.
The buried tank is eventually slated for removal. This request is a fix to storing the heating oil
supply for the affected Eugene O’Neill buildings.
Motion by Baird Welch-Collins, seconded by John Sheehan to approve the appropriation
as presented.
Vote: Unanimous Motion Passed

9.
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Establish the Tax Rate for Fiscal Year 2023.
Motion was made by John Sheehan, seconded by Baird Welch-Collins to set the tax rate
for fiscal year 2023 at 27.56%.
Vote: Unanimous Motion Passed
10, Old Business:
11.
12.
13.
Just a reminder that Kim Allen, Finance Director has indicated that next month she will present a
draft policy about submitting Capital Projects out of the regular budget cycle.
New Business:
a. Discussion of FY22 Spending Freeze currently in place.
It is understood that it isn’t a spending freeze as much as it is asking Departments to take a
second look at any purchases before it happens.
Liaison Reports
Mr. Patterson reported the Municipal Complex Building Committee has several outstanding
invoices and open purchase orders related to external signage to be addressed. There was also
discussion about the soil monitoring program at the site as it appears there are distinct phases
to the program and there are open questions around the sources of funding for each phase to
be addressed with the Finance Director.
Correspondence
a. Abbas Danesh, Town Treasurer, Quarterly Treasurer’s Report and Related Financials
ending 3/31/2022
b. Virginia Bielucki, Town Accountant, Revised Periodic Financial Statements FY22 dated
April 12, 2022
c. Virginia Bielucki, Town Accountant, Status of General Fund Unassigned Balance dated
April 12, 2022
Virginia Bielucki, Town Accountant, Status of Contingency FY22 dated April 20, 2022
Virginia Bielucki, Town Accountant, April 2022 Periodic Financial Statements FY22 dated
May 9, 2022
Town of Waterford Civic Triangle Upgrade Petition
g. American Rescue Fund Quarterly Expenditure Report
h. FY23 Utility Commission Draft Budget.

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14. Adjournment
Motion by John Sheehan, seconded by Baird Welch-Collins to adjourn the regular meeting of the
May 18, 2022 Board of Finance at 8:00 pm..
Vote: Unanimous Motion Passed
Respectfully Submitted,
John Sheehan, Clerk Sandra Kenniston, Recording Secretary

BOARD OF FINANCE
REQUESTING NEW CAPITAL PROJECT APPROVAL OUTSIDE THE BUDGET CYCLE POLICY
Departments will make every effort to process Capital budget requests through the annual
budget cycle to allow for transparency and efficient long-range fiscal and budget planning.
For unforeseen and emergency project requests that may occur out of the annual budget cycle,
the following procedures will be followed.
A. Project Details
Please submit a request for a new project that must include a summary detailing the Project,
ject, project costestimates (include:quet
te and com
é cost of the
project: ora summary on how timate was calculat
D. Project Funding Sources
Funding relates to the source of cash. All new capital project requests should specify here if it is
known that some of the cash to fund the project will come from a gift, grant, endowment or
operating budget.
E. Project Approval
All new capital requests will follow the normal approval cycle: Board of Selectmen, Board of
Finance, and Representative Town Meeting.
Draft 6/8/2022

tb,
Town of Waterford
Post-Issuance Compliance Procedures
For Bonds, Notes and Other Debt Obligations
Date Adopted:
L. INTRODUCTION
These post-issuance compliance procedures of the Town of
are designed to provide for the effective management of tl
program related to bonds, notes, financing leases, or o
to herein as “bonds’”) of the Town under federal tax la
applicable to a particular issue of bonds.
ord, Connecticut (the “Town”)
’s post-issuance compliance
igations (collectively referred
al, securities laws, to the extent
The Director of Finance of the Town will be t icer responsible for
each issuance of bonds and for overseeing the To 
program through
the implementation of these procedures. All inform: and the
: all be maintained by or on behalf
of the Director of Finance. The Direc Fing review these procedures on at least an
annual basis and will update them as n fl
consultation with bond counsel.
aws. In carrying out these post-issuance
consult with and seek assistance from
Il. POST-ISSUANEE.T.
The following procedures are applicable to any bonds issued by the Town the interest on which is
excluded from federal income taxes.
A. Tax Certificate and Continuing Education
I. Tax Certificate - A Tax Certificate is prepared for each issuance of bonds. Immediately
upon issuing any bonds, the Director of Finance, in consultation with Munistat and
Hinckley Allen, shall review the Tax Certificate and make notes regarding specific
compliance issues for such bond issue on the Post-Issuance Compliance Notes form,
which is attached hereto as Exhibit A (the ““Notes”). The Tax Certificate and Notes shall
clearly define the roles and responsibilities relating to the ongoing compliance activities
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for each bond issue and will identify specific compliance requirements. The Director of
Finance will review the Tax Certificate and Post-Issuance Compliance Notes for each
issue of outstanding bonds on at least an annual basis to ensure that the specific
compliance issues for such bonds are being monitored and addressed.
2. Continuing Education - The Director of Finance will actively seek out advice of
Hinckley Allen on any matters that appear to raise ongoing tax law compliance concerns
and may attend or participate or direct other Town personnel to attend or participate in
seminars, teleconferences, etc. that address federal tax law compliance issues and
developments in the public finance arena.
B. Tax-Exempt Bonds Compliance Monitoring
1. Ownership of Bond-Financed Property — One of the requirements with respect to tax-
exempt bonds issued for the benefit of issuers like the Town is that the bond-financed
property generally must be owned by a State or local governmental unit throughout the
lesser of (i) the term of the bonds (and of any refunding bonds subsequently issued to
refinance the property) or (ii) the useful life of the property. Any proposed sale,
exchange, trade-in, or other disposition of ownership of or title to bond-financed property
(other than a sale for salvage value or the disposal of such property as waste at the end of
its useful life to the Town) should be reviewed in advance with Hinckley Allen so that
appropriate, timely “remedial action” can be taken to protect the tax-advantaged status of
the bonds, if required.
2. Restrictions against other Private Use — The Director of Finance will continuously
monitor the expenditure of bond proceeds and the use of facilities or equipment financed
with bonds to ensure compliance with Section 141 of the Internal Revenue Code (the
“Code”), which establishes limitations on the use of bond-financed property by persons or
entities that are not units of State or local government. These limitations apply, for
example, to individuals using bond-financed assets on a basis other than as a member of
the general public, to corporations and partnerships and to the federal government and its
agencies and instrumentalities.
a. Use of Bond Proceeds — The Director of Finance will monitor and maintain records
with respect to expenditures to ensure that “new money” bond proceeds are being used
on capital expenditures for exempt purposes in accordance with the governing bond
legal documents (and also to facilitate the tracking of such expenditures with respect
to refunding issues that refinance such “new money” bonds) and will document the
allocation of all bond proceeds including “new money” and refunding purposes.
b. Use of the Bond-Financed Facility or Equipment
i. Equipment assets financed or refinanced with bonds will be listed in a
schedule for each bond issue. The Director of Finance will maintain (1) a list
of all bond-financed equipment allocable to each bond issue and (ii) a record of
such equipment’s expected useful life. Equipment assets generally are not to
be sold or disposed of prior to the earlier of (a) the date the “new money”
bonds and all subsequent refundings of such bonds are fully paid or (b) the end
of the useful life of such equipment.
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il.
ili.
Constructed, renovated or acquired assets financed or refinanced with
bonds — In order to ensure that assets constructed, renovated or acquired using
bond proceeds, such as buildings, real property improvements and other
infrastructure assets, are not leased, sold or disposed of prior to the end of the
term of the applicable bonds and of all subsequent refundings of such bonds:
e Any asset constructed, renovated or acquired with bond proceeds shall be
flagged in the Town’s records, and
e All uses of these assets will be monitored by the Director of Finance.
Change of Use — If there is any proposal to change the use of a bond-financed
facility from a qualified purpose to a use in which a private (or federal
government) entity may have the use or benefit of such a facility, the Director
of Finance will consult with Hinckley Allen prior to the occurrence of the
proposed change in use to determine what impact, if any, the proposed change
may have on the tax-exempt status of the applicable bonds. Examples of
changes in use that can affect the tax-exempt status of bonds include
management contracts with third parties for the management or operation of
bond-financed assets and leases of buildings or other property to third parties.
3. Qualification for Initial Temporary Periods and Compliance with Restrictions against
Hedge Bonds
a. Expectations as to Expenditure of Bond Proceeds
i.
il.
In order to qualify under the arbitrage rules of Code Section 148 for an initial
temporary period, usually for three (3) years, with respect to a new money
bond financing—during which bond proceeds can be invested without regard
to yield (but potentially subject to rebate)—the Town must reasonably expect
to spend at least 85% of “net sale proceeds” of the bonds by the end of the
temporary period. Additionally, under Code Section 149, in order to avoid
classification of an issue of bonds as “hedge bonds,” the Town must both (i)
reasonably expect to spend 85% of the “net sale proceeds” of the bonds within
the three-year period beginning on the issuance date of the bonds and (ii)
invest not more than 50% of the proceeds of the issue in investments having a
substantially guaranteed yield for four (4) years or more. These expectations
will be documented for the Town’s outstanding bond issues in the Tax
Certificate executed in connection with each new money bond issue.
If, for any reason, the Town’s expectations concerning the period over which
the bond proceeds are to be expended change from what was documented in
the applicable Tax Certificate, such that the length of expenditure period is
expected to be extend beyond three years from the issuance date of a new
money bond issue, the Director of Finance will consult with Hinckley Allen.
b. Bond Proceeds Spending Schedule Compliance Monitoring — For as long as there are
61533406 v1
unspent “new money” proceeds of a bond issue, the Director of Finance will compare
and analyze the original anticipated capital project spending schedule and the actual
payouts and reimbursements on each bond-financed project, on an annual or more
3

frequent basis. The purpose of this analysis is to identify variances from the original
spending schedule for each project and to document the reasons for these variances (to
the extent they reflect delays in the expenditure of bond proceeds) to provide a
continual record on the spending progress for each bond-financed project. Generally,
if there are delays in expending new money bond proceeds, the tax-exempt status of
the bonds under either the temporary period rules or the hedge bond rules should not
be adversely affected, unless circumstances surrounding actual events relating to
project development cast doubt on the reasonableness of the stated expectations
regarding expenditures that were documented on the issuance date in the applicable
Tax Certificate on the issuance date. Therefore, it is important for the Director of
Finance to update the progress of each project at least annually, and consult with bond
counsel as to any substantial delays from the original expenditure schedule.
Investment Earnings Monitoring — As part of the monitoring process described in
Section JI.B.3.b above, the Director of Finance will track the actual investment
earnings accruing on unexpended bond proceeds on an annual or more frequent basis
and will track the expenditure of all such earnings (which are treated for tax law
purposes as additional proceeds of the bonds) on project costs.
4. Arbitrage and Rebate Compliance
a.
In General. Bonds may lose their tax-favored status, retroactive to the date of
issuance, if they do not comply with the arbitrage restrictions of Section 148 of the
Code. Two sets of requirements under the Code generally must be applied in order to
determine whether bonds satisfy Section 148 of the Code: (1) the yield restriction
requirements of Section 148(a) and (2) the rebate requirements of Section 148(f).
Yield Restriction Requirements. The yield restriction requirements provide, in
general terms, that the “gross proceeds” of a bond issue may not be invested in
investments generating a yield higher than the yield of the bond issue, except for
investments (i) during one of the temporary periods permitted under the arbitrage rules
(including the initial three year temporary period described in Section I.B.3.a.ii
above, a 90-day temporary period for current refundings and another temporary period
for moneys expected to be used on a current basis to pay debt service on the bonds),
(ii) in a reasonably required reserve or replacement fund or (iii) in an amount not in
excess of the lesser of 5% of the sale proceeds of the issue or $100,000 (the so-called
“minor portion”). Under limited circumstances, the yield on investments subject to
yield restriction can be reduced through payments to the IRS known as “yield
reduction payments.” The Tax Certificate will identify those funds and accounts
associated with a particular issue of bonds known, as of the date of issuance, to be
subject to yield restriction.
c. Rebate Requirements
61533406 v1
i. If, consistent with the yield restriction requirements of the arbitrage rules,
amounts treated as bond proceeds are permitted to be invested at a yield in
excess of the yield on the bonds pursuant to one of the three exceptions to yield
restriction referred to above, rebate payments may be required to be made to
the U.S. Treasury. Under the arbitrage rules, the aggregate rebate liability is
4

il.
generally the present value of the excess of the amount actually earned on bond
funded investments over the amount that would have been earned on such
investments had they been invested at the yield on the bonds. At least 90% of
the rebate amount calculated for the first computation period must be paid no
later than 60 days after the end of the first computation period. The amount of
rebate payments required for subsequent computation periods (other than the
final period) is that amount which, when added to the future value of prior
rebate payments, equals at least 90% of the rebate amount. For the final
computation period, 100% of the calculated amount must be paid. Available
exceptions to the rebate requirement, and related expectations, are generally
documented for each bond issue in the applicable Tax Certificate, although
rebate liability and compliance is generally based on actual facts established
after bond closing.
As required, the Town will have Munistat calculate, or engage another
experienced independent rebate analyst to calculate, the cumulative rebate
liability (positive or negative) that has accrued with respect to the bonds and
provide a written rebate report to the Director of Finance documenting the
rebate analyst’s methodology and conclusions. Hinckley Allen can assist with
referrals to qualified rebate analysts.
d. Timing of Rebate Payments
The Director of Finance will ensure the proper calculation and payment of any rebate
payment (and/or yield-reduction payment) within the following time frames:
i.
il.
iii.
The first installment with respect to a bond issue is due no later than 60 days
after the end of the fifth (5") anniversary of each bond issuance;
Succeeding installments are due at least every fifth (5th) following anniversary
date;
The final installment with respect to a bond issue is due no later than 60 days
after retirement of the last bond of the issue (whether at final maturity or
earlier, on an optional bond redemption date or when bonds are purchased or
otherwise acquired for retirement or cancellation); generally, a final rebate
installment will be due not later than 60 days after early retirement of the last
bond in the issue in connection with a refunding of that issue.
Rebate (and/or yield reduction) payments are accompanied by returns filed on IRS Form
8038-T.
Cc. Record Retention
1. General
Section 6001 of the Code provides the general rule for the proper retention of records for
federal tax purposes. The IRS regularly advises taxpayers to maintain sufficient records to
support their tax deductions, credits and exclusions. In the case of a tax-exempt bond
61533406 v1
5

transaction, the primary taxpayers are the bondholders. In order to ensure the continued
tax-exempt treatment of interest on its bonds, it is important, in all cases, that the Town
retain sufficient records to support characterization of the bonds as tax-exempt.
2. Storage of Records
a,
All records associated with any bond issue shall be stored electronically or in hard
copy form at the Town’s main offices or at another location conveniently accessible to
the Town.
The Director of Finance will ensure that the Town provides for appropriate storage of
these records.
If storing documents electronically, the Town shall conform with IRS Revenue
Procedure 97-22, 1997-1 C.B. 652 (as the same may be amended, supplemented or
superseded), which provides guidance on maintaining books and records by using an
electronic storage system. Bond counsel can furnish a copy of this Revenue Procedure
if needed.
3. Bond-Related Records
The Town shall maintain bond records as identified in this Section II.C.3 for the longer of
(i) the life of the bonds plus six (6) years or (ii) the life of refunding bonds (or the series of
refunding bonds) that refinance the bonds plus six (6) years. Bond records shall include
the following documents:
a. Pre-Issuance Documents
61533406 v1
i.
ii.
Guaranteed Investment Contracts (“GICs”) and Other Investments
(including Treasury State and Local Government Series obligations
(“SLGS”)) — if applicable, the Director of Finance shall retain all
documentation regarding the procurement of each GIC or other investment
acquired prior to bond issuance in anticipation of the issuance of the bonds,
including if applicable the request for bids, bid sheets, documentation of
procurement method (i.e., competitive vs. negotiated), etc. If investments
other than SLGS are used for a defeasance escrow, the documentation should
include an explanation of the reason for the purchase of such non-SLGS
securities and documentation establishing the fair value of the securities at the
time of acquisition and compliance with safe harbor bidding rules. If SLGS
are purchased, documentation relating to all preliminary and/or final SLGS
subscriptions shall be maintained.
Anticipated Capital Spending Schedule — the Director of Finance shall retain
all documentation and calculations relating to the anticipated capital spending
schedule used to meet the “reasonable expectations” test and use of proceeds
tests, as well as copies of contracts with general and sub-contractors or
summaries thereof.

iii.
iv.
vi.
Issue Sizing — the Director of Finance shall maintain a copy of all bond
structuring proposals and information furnished in connection with the bond
issue.
Bond Insurance or Other Credit Enhancement — if applicable, the Director of
Finance shall maintain a copy of insurer and credit provider premium or fee
quotes and calculations supporting the cost benefit of acquiring bond insurance
or other credit enhancement with respect to the bonds.
Forward Starting Swaps or Other Hedge Documentation — if applicable, the
Director of Finance shall retain all documentation regarding any interest rate
swap or other hedge agreement entered into on or before the date of bond
issuance relating to the bonds, including any “swap identification”
documentation prepared with respect thereto in order to facilitate the treatment
of such agreement as a “qualified hedge” under the arbitrage rules of Code
Section 148.
Costs of Issuance documentation — the Director of Finance shall retain all
invoices, payments and certificates related to costs of issuance of the bonds.
b. Issuance Documents
i.
The Director of Finance shall retain a physical bond transcript and/or a digital
copy of the bond transcript.
ce. Post-Issuance Documents
61533406 v1
ii.
ill.
Post-Issuance Guaranteed Investment Contracts and Investments (including
SLGS) — the Director of Finance shall retain all documentation regarding the
procurement of any GIC or other investment acquired with bond proceeds after
bond issuance, including as applicable the request for bids, bid sheets,
documentation of procurement method (i.e., competitive vs. negotiated), etc. If
investments other than SLGS are used for a refunding defeasance escrow, the
documentation should include an explanation of the reason for the purchase of
such non-SLGS securities and documentation establishing the fair value of the
securities and compliance with safe harbor bidding rules. If SLGS are
purchased, documentation relating to all preliminary and/or final SLGS
subscriptions shall be maintained.
Post-Issuance Swap or Other Hedge Documentation — the Director of
Finance shall retain all documentation regarding any interest rate swap or other
hedge agreement entered into after date of bond issuance relating to the bonds,
including any “swap identification” documentation prepared with respect
thereto in order to facilitate the treatment of such agreement as a “qualified
hedge” under the arbitrage rules of Code Section 148.
Interest Rate Resets — for bonds bearing interest at variable rates, records of
each interest rate reset.

iv. Records of Investments — statements of earnings and any other documentation
regarding investments acquired with bond proceeds shall be retained by the
Director of Finance.
v. Investment and Expenditure Activity Statements — the Director of l'inance
shall maintain or shall cause to be maintained all invoices and other spending
records relating to expenditures of bond proceeds for equipment purchases and
constructed, renovated or acquired projects or for any other purpose, as well as
all records relating to the investment of such proceeds prior to expenditure.
Such records may be maintained either electronically or in hard copy form.
vi. Records of Compliance
¢ Qualification for Initial Temporary Periods and Compliance with
Restrictions Against Hedge Bond Documentation — the Director of
Finance shall prepare the annual analysis described in Section II.B.3 of this
document and maintain these records.
e Arbitrage Rebate Reports — may be prepared by the Director of Finance or
a third party as described in Section II.B.4.c.ii of this document, and copies
of all such reports will be retained by the Director of Finance.
e Rebate Returns and Payment -— shall be prepared at the direction of the
Director of Finance and filed as described in Section II.B.4.d of this
document, and copies of all such returns and payments will be retained by
the Director of Finance.
e Contracts under which any bond proceeds are spent (consulting
engineering, acquisition, construction, etc.) - the Director of Finance shall
obtain copies of these contracts and retain them in the bond files.
d. General
i. Audited Financial Statements — the Director of Finance will maintain copies
of the Town’s annual audited financial statements.
ii. Reports of any prior IRS Examinations — the Director of Finance will
maintain copies of any written materials pertaining to any IRS examination of
the Town’s bonds.
D. Voluntarily Correcting Failures to Comply with Post-Issuance Compliance
Requirements
If, in the course of monitoring compliance with applicable federal tax laws, a potential federal tax
law violation is discovered in connection with an issue of its bonds, the Town may be able to
address the violation through one of the methods listed below. The Town should work with
Hinckley Allen to determine the best way to proceed if a violation is discovered or suspected.
d. Taking remedial actions permitted under the Treasury Regulations
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61533406 v1

Depending upon the nature of the potential violation and the timing of the discovery of the
potential violation, it may be possible for the Town to take “remedial action” under
applicable Treasury Regulations to protect the tax-advantaged status of the bonds through
timely action. Depending upon the facts, such remedial action might involve a prompt
redemption or defeasance of all or a portion of the outstanding bonds or, in some cases,
the tracing of sale or other disposition proceeds to the acquisition of other tax law
compliant assets, or the tracing of the bond-financed assets themselves to another tax law
compliant use. It is essential, however, that the potential violation be brought to the
attention of Hinckley Allen as soon as possible because the remedial action rules are
subject to strict timing limitations.
2 Utilizing the Voluntary Closing Agreement Program
The Internal Revenue Manual establishes a voluntary closing agreement program (VCAP)
for tax-exempt bonds whereby bond borrowers can disclose and resolve tax law violations
through closing agreements with the Internal Revenue Service in a manner that preserves
the tax-exempt status of the bonds.
Wl. POstT-ISSUANCE CONTINUING DISCLOSURE COMPLIANCE
Federal securities laws prohibit making any untrue statement of a material fact or omitting any
material fact necessary in order to make disclosure statements, in the light of the circumstances
under which they were made, not misleading. The Director of Finance will take primary
responsibility to ensure that the Town complies with each obligation included in its continuing
disclosure agreements or certificates executed in connection with each of its outstanding bond
issues for which a continuing disclosure agreement was required and entered into by the Town,
both as to (A) the timeliness and content of continuing disclosure filings, and (B) the accuracy of
disclosure regarding such filings in the Town’s official statements. In furtherance of this
responsibility, the Director of Finance will take primary responsibility for ensuring that the Town
carefully reviews its continuing disclosure obligations, submits timely and complete filings in
accordance with such obligations and submits disclosure filings that are accurate, complete and
not misleading.
A. The Obligations of the Town
Under the provisions of Rule 15c2-12 adopted by the Securities and Exchange Commission under
the Securities Exchange Act of 1934 (the “Rule”), Participating Underwriters (as defined in the
Rule) are required to determine that issuers have entered into written continuing disclosure
agreements to make ongoing disclosure in connection with bonds subject to the Rule. Unless a
bond issue of the Town is exempt from compliance with the Rule or the continuing disclosure
provisions of the Rule as a result of certain permitted exceptions, the Town will enter into such a
continuing disclosure agreement upon the issuance of the bonds.
Pursuant to any continuing disclosure agreement entered into by the Town in connection with an
issue of bonds, the Town agrees to provide certain information for the benefit of the owners of the
Town’s bonds and to assist the purchasers of the Town’s bonds in complying with the Rule. The
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61533406 v1

information required to be provided will be specified in each continuing disclosure agreement and
may include annual reports and/or notice of certain significant events, depending on the term of
the bonds. Compliance with the filing requirements may be satisfied by filing the information
with the Municipal Securities Rulemaking Board through its Electronic Municipal Market Access
(“EMMA”) website.
Annual reports required to be filed will include audited financial statements of the Town and
certain financial and operating data specified in the continuing disclosure agreement. The annual
reports are required to be filed on an annual basis on or before a date specified in the continuing
disclosure agreement.
Continuing disclosure agreements also require the Town to file notice of the occurrence of certain
significant events by a certain number of days specified in the agreement from the occurrence of
the event (typically 10 business days from the occurrence of the event). Although the list of
significant events in a particular continuing disclosure agreement may differ based on the list that
existed in the Rule at the time of the particular bond issue, the current list of significant events
that must be included in a continuing disclosure agreement for which a filing is required is as
follows:
1. Principal and interest payment delinquencies.
2. Non-payment related defaults, 1f material.
3. Unscheduled draws on debt service reserves reflecting financial difficulties.
4. Unscheduled draws on credit enhancements reflecting financial difficulties.
5. Substitution of credit or liquidity providers, or their failure to perform.
6. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or
final determinations of taxability, Notices of Proposed Issue (RS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the bonds, or other material
events affecting the tax status of any of the Town’s bonds or notes.
7. Modifications to rights of the registered owners, including beneficial owners, of the
Town’s bonds and notes, if material.
8. Bond calls, if material, and tender offers.
9. Defeasances.
10. Release, substitution or sale of property securing repayment of any of the Town’s
bonds or notes, if material.
11. Rating changes.
10
61533406 v1

12. Bankruptcy, insolvency, receivership or similar event of the Town.”
13. The consummation of a merger, consolidation, or acquisition involving the Town or
the sale of all or substantially all of the assets of the Town, 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.
14. Appointment of a successor or additional trustee or the change of name of a trustee,
if material.
15. Incurrence of a financial obligation of the Town, if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of a financial
obligation of the Town, any of which affect the registered owners, including beneficial owners,
of the bonds, if material.’
16. Default, event of acceleration, termination event, modification of terms, or other
similar events under the terms of a financial obligation of the Town, any of which reflect
financial difficulties.’
The Director of Finance will compile and maintain a set of all currently effective continuing
disclosure agreements of the Town for bonds that are currently outstanding, each of which will
have been included in the closing transcript for the related bond issue. As bonds are completely
paid or redeemed, the Director of Finance will remove the related continuing disclosure
agreement from the set of currently effective continuing disclosure agreements. The following
procedures are required for and shall apply to only the currently effective continuing disclosure
agreements for which continued compliance is required.
B. Timeliness and Content of Continuing Disclosure Filings
I. Annual Reports
The Director of Finance will take primary responsibility for ensuring that the Town’s Annual
Reports are assembled to include the information required by its continuing disclosure agreements
and are filed on EMMA within the period of time after the end of the Town’s fiscal year specified
in the applicable continuing disclosure agreement. The Town’s Annual Report will be posted on
* As noted in the Rule, this event is considered to occur when any of the following occur: (i) the appointment of a
receiver, fiscal agent or similar officer for the Town in a proceeding under the U.S. Bankruptcy Code or in any
proceeding under state or federal law in which a court or governmental Town has assumed jurisdiction over
substantially all of the assets or business of the Town, 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 Town, or (ii) the entry of an order confirming a plan of reorganization, arrangement or liquidation by a
court or governmental Town having supervision or jurisdiction over substantially all of the assets or business of the
Town.
* For purposes of event numbers 15 and 16, the term “financial obligation” means a (i) debt obligation; (ii) derivative
instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned
debt obligation; or (iii) guarantee of (i) or (ii). The term “financial obligation” excludes municipal securities for
which a final official statement has been provided to the MSRB consistent with the Rule. In the case of the Town, a
“financial obligation” would include, among other things and if material, any bonds or notes for which a final official
statement has not been filed with the MSRB, letters of credit, and lease purchase agreements.
11
61533406 v1

EMMA by Munistat. To ensure the Town’s Annual Reports are complete, accurate and not
misleading, the Town agrees to take the following steps:
1. The Director of Finance shall arrange for Munistat to provide him or her with
notice of the deadline for filing an Annual Report at least two months prior to the deadline.
2. The Director of Finance shall review each of the Town’s continuing disclosure
agreements to confirm the information and material that is required to be filed as part of the
Annual Report;
3. The Director of Finance will work with Munistat to complete a draft of each
Annual Report at least one month prior to the required filing date;
4. The Director of Finance will provide the draft Annual Report to and consult with
any relevant officials of the Town, the Town’s staff and any other party, as he or she deems
appropriate, to solicit assistance in completing the Annual Report or to address any questions
that arise with respect to the accuracy or completeness of the Annual Report to ensure that it is
accurate, complete and not misleading; and
5. When the Director of Finance has resolved all questions regarding the accuracy and
completeness of, and any potentially misleading statements in, the Annual Report and
determined that it is in final form and responsive to the information required to be included
pursuant to the continuing disclosure agreements of the Town, the Director of Finance will
provide the final version of the Annual Report to Munistat for filing and arrange for the filing
of the Annual Report by Munistat on EMMA on or before the deadline specified in the
applicable continuing disclosure agreement or agreements.
II. Notices of Significant Events
The Director of Finance will monitor the Town’s continuing disclosure compliance on a frequent
and ongoing basis with respect to notice of the events specified in the Town’s continuing
disclosure agreements and be responsible for ensuring that notice of the occurrence of any such
events is filed on EMMA by Munistat within the time period required in the applicable continuing
disclosure agreements. In order to facilitate such compliance, the Director of Finance will:
1. Arrange for Munistat to provide written notification by email or otherwise to the
Director of Finance on a periodic basis, but at least annually, to ensure he or-she
regularly reviews the list of events specified in the Town’s continuing disclosure
agreements to determine whether any event has occurred that may require filing
notice on EMMA;
2. Establish an internal process that includes any other official of the Town that may
have authority to negotiate and/or enter into the types of arrangements described in
event number 15 of the Rule to ensure that any such arrangements are reviewed by
the Director of Finance, in consultation with the Town’s officials and staff,
Munistat, Hinckley Allen and/or general counsel, as appropriate, sufficiently in
advance of the execution thereof in order to determine whether the arrangement
will result in a financial obligation or agreement that is material;
12
61533406 v1

3. Upon the occurrence of any such event or potential event, immediately consult
with the Town’s officials and staff, Munistat, Hinckley Allen and/or general
counsel, as appropriate, to confirm the Town’s obligation to disclose such event;
and
4, Arrange with Munistat for a timely filing of notice on EMMA regarding the
occurrence of any such event.
C. Accuracy of Disclosure in Official Statements
The Director of Finance will be responsible for ensuring the accuracy and completeness of
disclosure in the Town’s official statements regarding the Town’s continuing disclosure
compliance. In furtherance of this responsibility, the Director of Finance will take the following
steps while preparing any official statement of the Town:
1. Review both (i) the timeliness and (ii) the content and sufficiency of the Town’s
Annual Report filings for the five-year period preceding the official statement, noting any
instances of late or incomplete filings;
2. Review the list of events specified in the Town’s continuing disclosure agreements
and certificates to determine whether any event has occurred during the five-year period
preceding the official statement and, if any such event has occurred, confirm that notices of
such event or events have been timely filed on EMMA;
3. Consult with the Town’s staff, Munistat, Hinckley Allen and/or general counsel, as
appropriate, with respect to any question regarding the Town’s continuing disclosure
compliance;
4. If needed, arrange for Munistat to file any corrective or missing disclosure and/or
notices on EMMA; and
5. Collaborate with Munistat and Hinckley Allen to draft a statement regarding the
Town’s continuing disclosure compliance in the five-year period preceding the official
statement that reflects any instances of noncompliance by the Town during such period.
13
61533406 v1

Exhibit A
POST ISSUANCE COMPLIANCE NOTES
[Name of Bonds]
Transaction Parties
Bond Counsel: Hinckley Allen
Municipal Advisor: Munistat Services, Inc.
Paying Agent:
Bondowner/Purchaser:
Underwriter:
Rebate Specialist:
Other:
61533406 v1

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T
TOWN
OF
WATERFORD
Upgrade
scheduled
for
Fall
2022
to
include
a
new
server
migration
to
the
new
version,
FY17
300,000.00
7,200.00
0.00
0.00
Design
Contract
Awarded.
Preliminary
design
completed
but
cost
estimates
are
$1.2
million.
Working
to
split
projec’
FY18
195,320.00
57,000.00
500.00
0.00
Design
Contract
Awarded.
Preliminary
design
completed
but
cost
estimates
are
$1.2
million.
Working
to
split
project
into
FY20
0.00
Project
to
address
PD
ADA
access.
Project
is
in
purchasing
dept.
to
prepare
bid.
FY20
87,500.00
7,400.00
7,190.00
0.00
Design
contract
awarded.
Additional
funds
requested
in
FY24.
FY21
80,700.00
4,500.00
14,000.00
This
is
in
conjunction
with
the
0.00
Project
to
address
PD
ADA
access.
Project
is
in
purchasing
dept.
to
prepare
bid.
FY.22
0.00
0.00
Design
contract
awarded.
Additional
funds
needed
to
complete
project
and
will
be
250,000.00
24,000.00
0.00
0.00
Will
move
forward
now
that
referendum
is
FY22
0.00
0.
o
3
engineer.
Plan
to
bid
mid
August
2022.
31122-55893
FY22
60,767.64
2,350.00
0.00
0.00
31122-57857
FY22
150,000.00
0.00
149,140.00
0.00
0.00
Hoc
committee
with
finalize
permitting,
design
and
bid
documents
to
proceed
with
dredging
and
construction
of
accessible

ACTIVITY
AS
OF
05/31/22
1,705.00}
Completed
5/2022.
Can
be
closed
once
FY20
30,000.00
0.00
Working
on
final
chapter
and
anticipated
some
delays.
FY20
review.
Project
on
hold.
CYBER CRIME TASK FORCE EQUIPMENT
FY22
9,452.51
0.00
32922-55878
FY22
Project
is
on
hold
due
to
the
parking
lot
FY22
FY20
0.00
0.00
CROSS ROAD FUNDING OFFSET
FY20
0.00
(2,754,000.00)
0.00
FY21
299,000.00
Conduit
and
wiring
is
in
process.
Some
33022-55882
FY22
0.00
0.00
WILLIAM ST CONCRETER SIDEWALK
FY 22
42,300.00
0.00
0.00
0.00
Will
be
requesting
balance
to
be
funded
SUMMER STREET/CONCRETE SW
FY 22
33,420.00
0.00
0.00
0.00
DAVID STREET/CONCRETE SW
FY 22
0.00
0.00
EY¥22
0.00
0.00
69,800.00
0.00
0.00]
Project
placed
on
hold.
Included
this
work
FY22
334,473.00
June 2022
0.00
33022-55890
ROAD RESURFACING EVERSOURCE A=
FY22
0.00
FY22
106,548.00
0.00

ACTIVITY AS OF 05/31/22
FY
20
This
funding,
together
with
funding
under
LI
33121-55821
(below)
is
being
used
for
(Harvey
Ave.
PS,
Bolles
Ct.
PS,
and
PO
220505
($121,487)
issued
to
vendor
June.
FY21
85,000.00
0.00
FY21
issues.
Pump
is
expected
to
be
shipped
by
end
June.
With
ongoing
supply
chain
issues,
installation
of
33122-55894
FY22
Work
is
ongoing.
Expected
completion
is
mid
FY22

0.00
Selectman
and
Finance
Director,
it
was
to see if they would be able to assist with
workload
of
the
WUC
staff,
this
project
may
and the recent raise of cost in materials
are in hand for this project, Estimated
completion is spring 2023 for phase |, which
includes
the
main
water
line/system
lower multi-purpose field. With the recently
FY 19
13,700.00
0.00
0.00
TBD
0.00
hold since it needs to be evaluated in
LEARY BASKETBALL COURT REPAIRS
FY 20
55,000.00
55,000,00
Quoting
Project
0.00
0.00
post tension concrete courts which will
continue our effort to get updated quotes,
which
will
allow
us
to
request
ad
33720-55855
TOWN HALL BASKETBALL COURT REPAIRS
FY 20
16,000.00
0.00
0.00
post tension concrete courts which will
require more funding, but provide fora
quotes from vendors, but quotes are very
funding
and
plan
for
the
work.

Et
QUIPMENT
STORAGE
PLAN
CAPITAL
PROJECTS
REVIEW
-
FY
2022
ACTIVITY
AS
OF
05/31/22
21,000.00;
_
21,000.00
piss
Sea
eee
aa
A
quote
was
originally
obtained
from
the
town’s
on-call
contractor
to
evaluate
improvements
needed
at
the
Veteran’s
Garage
and
Waterford
Beach
maintenance
facilities.
These
improvements
would
include
building
additions,
exterior
site
improvements,
and
allow
for
improved
storage
capacities
and
operations.
In
meeting
with
the
First
Selectman
and
Finance
Director,
it
was
decided
to
focus
on
the
Waterford
Beach
facility
first.
More
room
exists
at
that
site,
and
Civic
Triangle
development
needs
to
be
considered
as
well.
The
engineer
has
been
contacted
and
a
meeting
will
occur
soon.
Once
the
plan
is
completed,
we
will
request
funding
through
the
capital
process.
PAGE
5

TAL
ASSESSOI
CAPITAL
NON-RECURRING-
APPROPRIATE!
20523-57733
|OSWEGATCHIE
FIRE
BUILDING
IMPROVEMENTS|
FIRE
|AUGUST
2013
20,000.00
19,500.00
500.00)
0.00
0.00)
500.00
Project
being
reviewed
by
Director
and
RTM
Ad
Hoc
Committee.
20523-57751
|
ELECTICAL
UPGRADE
JORDAN
FIRE
JUNE
2016/
08/20/19
43,500.00)
3,324.75
40,175.25)
0.00
0.00
40,175.25
Project
was
awarded
through
bidding
process.
Work
to
start
20523-57792
|OSWEGATCHIE
FIRE
BUILDING
IMPROVEMENTS|
FIRE
05/02/17
10/15/18
260,000.00
46,300.00!
213,70