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230,550.00 230,550.00 -V00801 790-7915-429-33-05 146973 801 1/27/2012 HOUSTON ENGINEERING INC 99,200.00 92,424.03 6,775.97 V00802 790-7915-429-33-05 146974 801 1/27/2012 HOUSTON ENGINEERING INC 195,000.00 70,742.30 124,257.70 V00803 790-7915-429-33-05 146975 801 1/27/2012 HOUSTON ENGINEERING INC 73,000.00 27,832.96 45,167.04 V00804 790-7925-429-33-05 148054 801 801 2/29/2012 HOUSTON ENGINEERING INC 175,200.00 160,767.15 14,432.85 V00805 790-7915-429-33-05 148058 801 2/29/2012 HOUSTON ENGINEERING INC 102,340.00 43,625.75 58,714.25 V00806 790-7915-429-33-05 148078 801 2/29/2012 HOUSTON ENGINEERING INC 152,755.51 108,369.87 44,385.64 V00901 790-7915-429-33-05 146976 1118 1/27/2012 MOORE ENGINEERING INC 93,765.00 84,321.55 9,443.45 Page 1 FM Diversion Authority Outstanding Contracts As of June 30, 2012 Date: 6/28/2012 Project Number Account Number PO No. Vendor No. P.O. Date Vendor Encumbered Liquidated Balance V00902 790-7915-429-33-05 146977 1118 1/27/2012 MOORE ENGINEERING INC 145,050.00 116,789.89 28,260.11 V00903 790-7915-429-33-05 146978 1118 1/27/2012 MOORE ENGINEERING INC 152,330.00 70,225.22 82,104.78 V00904 790-7930-429-33-05 148055 1118 2/29/2012 MOORE ENGINEERING INC 130,866.00 28,881.61 101,984.39 V00905 790-7930-429-33-05 148056 1118 2/29/2012 MOORE ENGINEERING INC 24,680.00 18,584.28 6,095.72 V00906 790-7915-429-33-05 148057 1118 2/29/2012 MOORE ENGINEERING INC 8,340.00 8,326.50 13.50 V00907 790-7915-429-33-05 148077 1118 2/29/2012 MOORE ENGINEERING INC 183,920.00 149,879.88 34,040.12 V01001 790-7915-429-33-05 146979 17791 1/27/2012 URS CORPORATION 171,166.67 119,233.58 51,933.09 V01002 790-7915-429-33-05 148086 17791 2/29/2012 URS CORPORATION 192,000.00 -192,000.00 V01201 790-7930-429.33-25 F12069 19734 12/31/2011 CASS COUNTY COUNTY JOINT WATER RESOUR 16,708.86 16,708.86 -V01201 790-7930-429.34-65 F12069 19734 12/31/2011 CASS COUNTY JOINT WATER RESOUR 22,452.50 22,452.50 -V01201 790-7930-429-33-25 149405 19734 4/10/2012 CASS COUNTY JOINT WATER RESOUR 83,119.09 83,119.09 -V01301 790-7915-429-33-05 147745 1118 2/17/2012 MOORE ENGINEERING INC 5,558.50 5,558.50 -V01301 790-7931-429.33-25 F12593 1286 4/16/2012 OHNSTAD TWICHELL PC 1,408.00 1,408.00 -V01301 790-7931-429-33-05 149869 1118 4/23/2012 MOORE ENGINEERING INC 1,780.00 1,780.00 -V01301 790-7931-429-33-25 150230 1286 5/3/2012 OHNSTAD TWICHELL PC 2,029.50 2,029.50 -V01301 790-7931-429-33-25 150961 1286 5/23/2012 OHNSTAD TWICHELL PC 220.50 220.50 -V01301 790-7931-429-33-25 151790 1122 6/15/2012 MOORHEAD, CITY OF 15,062.90 15,062.90 -V01301 790-7931-429-33-25 152058 1286 6/27/2012 OHNSTAD TWICHELL PC 410.00 -410.00 V01501 790-7915-429-74-10 150960 19581 5/23/2012 GEOKON INC 33,748.60 -33,748.60 V01601 790-7920-429-33-05 151232 21007 5/31/2012 HOUSTON-MOORE GROUP LLC 961,675.00 -961,675.00 V01602 790-7930-429-33-05 151233 21007 5/31/2012 HOUSTON-MOORE GROUP LLC 871,000.00 -871,000.00 V01603 790-7915-429-33-05 151234 21007 5/31/2012 HOUSTON-MOORE GROUP LLC 2,333,300.00 -2,333,300.00 V01604 790-7930-429-33-05 151235 21007 5/31/2012 HOUSTON-MOORE GROUP LLC 1,421,000.00 -1,421,000.00 V01605 790-7915-429-33-05 151236 21007 5/31/2012 HOUSTON-MOORE GROUP LLC 605,000.00 -605,000.00 V01606 790-7930-429-33-05 151237 21007 5/31/2012 HOUSTON-MOORE GROUP LLC 197,503.00 -197,503.00 V01607 790-7915-429-33-05 152022 21007 6/25/2012 HOUSTON-MOORE GROUP LLC 240,000.00 -240,000.00 V01608 790-7915-429-33-05 152023 21007 6/25/2012 HOUSTON-MOORE GROUP LLC 669,330.00 -669,330.00 V01609 790-7915-429-33-05 152024 21007 6/25/2012 HOUSTON-MOORE GROUP LLC 194,341.00 -194,341.00 V01610 790-7930-429-33-05 152025 21007 6/25/2012 HOUSTON-MOORE GROUP LLC 94,000.00 -94,000.00 $ 15,930,102.03 $ 4,061,323.55 $ 11,868,778.48 Page 2 Scope of Services Flood Diversion Board of Authority July 11, 2012 The PFM Group Maria Altomare 77 West Port Plaza Suite 220 St. Louis, MO 63146 314-878-5000 314-878-5333 fax altomarem@pfm.com Jessica Cameron Mitchell 800 Nicollet Mall Suite 2710 Minneapolis, MN 55402 612-338-3535 612-338-7264 fax cameronj@pfm.com Scope of Services Flood Diversion Board of Authority | 1 PFM proposes the following scope of services for the Flood Diversion Board of Authority (the “Authority”). PFM shall provide services related to financial planning and policy development and services related to project funding and debt issuance. The services provided shall include but not necessarily be limited to the following: 1. Services related to the Financial Planning and Policy Development upon request of the Authority: • Assist the Authority in the formulation of Financial and Debt Policies. • Work collaboratively with the Authority, its Board, staff and consultants. • Analyze future debt capacity to determine the Authority’s ability to raise future debt capital. • Assist the Authority with the development of the Authority’s Financial Plan by assessing capital needs, identifying potential revenue sources, analyze financing alternatives such as pay-as-you-go, short-term vs. long-term financings, assessments, public/private projects, and grants and provide analysis of each alternative as required as to the budgetary and financial impact. • Review the reports of accountants, independent engineers and other project feasibility consultants to ensure that such studies adequately address technical, economic, and financial risk factors affecting the marketability of any proposed revenue debt issues; provide bond market assumptions necessary for financial projections included in these studies; attend all relevant working sessions regarding the preparations, review and completion of such independent studies, and provide written comments and recommendations regarding assumptions, analytic methods, and conclusions contained therein. • Develop, manage, and maintain computer model for long-term capital planning which provide for inputs regarding levels of ad valorem and non-ad valorem taxation, growth rates by revenue and expenditure item, timing, magnitude and cost of debt issuance, selected operating and debt ratio and other financial performance measures as as may be determined by the Authority. Such model will be designed in conjunction with the existing financial model created by the Authority’s Program Management Consultant, CH2M Hill. • Provide debt services schedules reflecting varying interest rates, issue sizes, and maturity structures as these are needed for feasibility consultants or for related Authority fiscal planning. • Attend meetings with staff, consultants and the Authority. • Coordinate communications with state and federal agencies. Assist in gaining necessary approvals, as appropriate. • Undertake any and all other financial planning and policy development assignments made by the Authority regarding bond and other financings, and financial policy including budget, tax, cash management issues and related fiscal policy and programs. • Assist the Authority in preparing financial presentations for public hearings and/or referendums. • Provide special financial services as requested by the Authority. 2. Services Related to Debt Transactions (Includes short-term financings, notes, loans, letters of credit, line of credit and bonds). Upon the request of the Authority: • Analyze financial and economic factors to determine if the issuance of bonds is appropriate. Scope of Services Flood Diversion Board of Authority | 2 • Develop a financing plan in concert with the Authority’s staff which would include recommendations as to the timing and number of series of bonds to be issued. • Assist the Authority by recommending the best method of sale, either as a negotiated sale, private placement or a public sale. In a public sale, make recommendation as to the determination of the best bid. In the event of a negotiated sale, assist in the solicitation, review and evaluation of any investment banking proposals, and provide advice and information necessary to aid in such selection. • Advise as to the various financing alternatives available to the Authority. • Develop alternatives related to Debt Transaction including evaluation of revenues available, maturity schedule, and cash flow requirements. • Evaluate benefits of Debt Service Reserve Fund and/or other security enhancements. • If appropriate, develop credit rating presentation and coordinate with the Authority the overall presentation to rating agencies. • Assist the Authority in the procurement of other services relating to debt issuance such as printing, paying agent, registrar, etc. • Identify key bond covenant features and advise on provisions to be included in bond resolutions and indentures regarding security, creation of reserve funds, flow of funds, redemption provisions, additional parity debt test, etc.; review and comment on successive drafts of bond resolutions. • Review the requirements and submit analysis of Insurance, rating agencies and other professionals as they pertain to the Authority’s obligation. • Review the terms, conditions and structure of any proposed debt offering undertaken by the Authority and provide suggestions, modifications and enhancements where appropriate and necessary to reflect the constraints or current financial policy and fiscal capability. • Assist in the preparation of the preliminary and final official statement and coordinate with the Authority the appropriate data, disclosure information and pertinent factors regarding the Authority and the proposed financing program. • Provide regular updates of tax-exempt bond market conditions and advise the Authority as to the most advantageous timing for issuing its debt. • Advise the Authority on the condition of the bond market at the time of sale, including volume, timing considerations, competing offerings, and general economic considerations. • If a negotiated transaction, assist and advise the Authority in negotiations with investment banking groups regarding fees, pricing of the bonds and final terms of any security offering, and make in writing definitive recommendations regarding a proposed offering. Provide assurance that the pricing of the bonds is the lowest price based on existing market conditions. • Arrange for the closing of the transaction including, but not limited, to bond printing, signing, and final delivery of the bonds. Additional Available Resources As mentioned earlier in the proposal, PFM has a broad range of additional resources available to the Authority. Following are a few of those services. Scope of Services Flood Diversion Board of Authority | 3 Public Private Partnerships – PFM has been at the forefront of Public-Private Partnerships since their introduction to the U.S. markets. PFM has substantial experience in assisting its clients with reviewing and evaluating corporate credits. The ability of a private sector partner to perform as needed is a key issue in many circumstances. PFM has advised state and local agencies in the review and evaluation of more than 40 publicprivate partnerships (“P3”) projects. We have advised on the negotiation of 15 development agreements and on the financing of more than $2 billion in projects. PFM views the role of planning as integral to developing a successful financing program. We have participated in numerous studies to determine the viability of publicprivate partnerships, privatization and other innovative funding alternatives. PFM typically engages in financial planning from a holistic viewpoint, analyzing every alternative and determining the most effective. Whether it is helping draft legislation, evaluating vendor financing alternatives, or advising on the benefits of design-build development, PFM prides itself in the ability to offer full service financial consulting to its clients. On May 16, 2011, PFM acquired Chicago-based Scott Balice Strategies LLC. The acquisition positions PFM as a leader with Midwest clients, large state and local governments, and as experts in the emerging field of public-private partnerships (P3s). Within the P3 sector, PFM has worked jointly and maintains a strong relationship with CH2M Hill. Quantitative Strategies Group -PFM’s Quantitative Strategies Group (the “QSG”) comprises a group of dedicated professionals whose mission is to develop proactive strategies and tools for all of PFM’s business practices. Through the use of advanced financial analysis and commercial and proprietary software, the QSG develops customized solutions to meet the individual quantitative needs of all of our clients. Our extensive quantitative capabilities allow us to provide services which address the full scope of strategic and operational considerations, ranging from capital financing strategies, to strategic planning and budgeting, to investment management strategies. Our Financial Risk Management, Structural Optimization, Refunding Efficiency, Forward Pricing, Other Post-Employee Benefits, Capital Improvement Fund and Budget Projection Models, to name a few, assist us in achieving these objectives. In addition to our on-going firm-wide support, the QSG constantly monitors the municipal market in order to stay abreast of new and emerging products and strategies and our strong market presence places PFM at the forefront of the development and implementation of these tools and strategies for our clients. To further enhance the accuracy and comprehensiveness of our leading quantitative resources, the QSG maintains direct access to numerous information services such as Bloomberg, Thomson Financial, Securities Data Corporation, and Municipal Market Advisors, among others. In addition to the aforementioned roles, the QSG administers the firm’s extensive three-month municipal finance training program for new and lateral hires. The QSG also participates in hosting PFM’s training seminars for our clients, with topics spanning from the basics of transaction management to policy level considerations. The multitude of services offered by the Quantitative Strategies Group assists PFM in optimizing its partnerships with clients. This collaborative relationship supports our clients’ ability to exceed both short-term budgetary goals and long-term strategic and capital financing objectives. Pricing Group -PFM has a dedicated, in-house bond Pricing Group that will join the core finance team to support the pricing of the Authority’s bonds. PFM’s Pricing Group operates completely independent of the underwriting of municipal securities by banks and securities dealers. The formation of PFM’s Pricing Group provides centralized access to market information and trends, leverages our knowledge firm-wide for our clients’ benefit, cultivates professional peer-to-peer relationships with underwriting desks, and fosters a better understanding of the internal workings of the underwriting process at the investment banks. Our approach to pricing debt instruments is unique in the municipal industry. PFM takes a rigorous and quantitative approach to pricing an issuer’s bonds. Instead of “calling around” to investment bankers to get a feel for the market, the Pricing Group provides our clients with informed, independent advice on the structure and pricing of all their debt instruments. Our capital markets access and experience, combined with our vast technical capabilities and expertise in financial modeling, our total commitment to the issuer’s point of view, our knowledge of state and federal securities law, and our clout as the largest financial advisor in the market enables PFM to offer our clients unparalleled depth and aptitude as their financial advisor. We are in the primary market, on average, three times per day pricing tax-exempt bond issues Scope of Services Flood Diversion Board of Authority | 4 for our clients. Moreover, we maintain a database on the pricing performance and syndicate member compensation on our client’s bond issues. Research Group -PFM professionals are supported by our Marketing & Research Support ("M&RS") department which specializes in market research, training, website development and graphic design. M&RS, specifically, maintains an extensive library of industry publications and reports as well as on-line news resources such as Factiva, Bond Buyer and Thomson Municipal News. In addition to our in-house technical resources, PFM makes use of nationally recognized timesharing networks, database management systems, and market information repositories including those of: Bloomberg, Thomson-Reuters (Securities Data Corporation), Thomson Financial and Municipal Market Data, MuniStatements, Factiva, eMAXX, rating agency databases, and Municipal Market Advisors. Further, access to the rating agency databases (Moody’s, S&P, Fitch) allows PFM to retrieve information such as credit/special/criteria reports, municipal financial ratio analyses and press releases. All of these resources allow us to also track municipal new issue pricings, access market interest rate scales, search for credit reports, and track secondary market trading activity and holders of bonds. Structured Products/Derivatives Advisory Group -PFM is unique among financial advisory firms in that we have a group of professionals solely dedicated to the derivatives and structured financial products area—the PFM Structured Products and Derivatives Group. Our Structured Products professionals are focused on providing clients with the highest quality advice and insight on the utilization, structuring, procurement and management of interest rate swaps, derivatives, and other financial products. In the early 1990s, we made significant investments in experienced personnel and technology and set up a separate business group to focus on this extremely complex area. Today, PFM is the recognized leader in the industry in both providing swap analysis, policy and strategy development, and in providing swap procurement services on both competitive and negotiated swap transactions. Additional Services PFM has additional services that the Authority may have interest in. Services relating to investments and arbitrage rebate are described in the following paragraphs. Investment Advisory Services PFM Asset Management’s investment philosophy is one that seeks to avoid credit risk, minimize market risk and produce high investment returns. Our focus is on high quality short/intermediate term securities of active portfolio management within the constraints imposed by our clients’ objectives of preserving principal and providing liquidity. The specific strategy PFM employs for each portfolio depends on the type of funds being managed (operating fund, reserves, etc.), current interest rates, permitted investments and liquidity requirements. Our primary objective is to avoid credit risk and minimize market risk, since this is the objective that is generally emphasized by our public sector clients. Hence we make no use of complex derivatives, little use of corporate credits below the AA rating, and limited use of mortgage-backed and asset-backed securities. Active portfolio management permits us to respond to changes in the markets and changes in cash flow requirements or draw schedules. This dynamic yet disciplined approach means that investment return can be enhanced through prudent trading and portfolio restructuring without subjecting a portfolio to unnecessary risk. We monitor assets and liabilities on a regular basis so that we can take full advantage of opportunities presented by the market. PFM views investments (assets) and financings (liabilities) to be intertwined and believes our clients are best served by contemplating the entire picture of asset liability management when making financial decisions. To assist our clients to this end, PFM has created a comprehensive asset liability model. Recognizing that the success of a capital program depends on management’s ability to develop and implement a comprehensive strategy to optimize both assets and liabilities of their program, PFM can provide you with investment advice that goes well beyond a single transaction to procure a fixed rate investment. Each of our clients is faced with Scope of Services Flood Diversion Board of Authority | 5 different program challenges and unique program goals and objectives that must be considered in the framework of offering investment advice. In addition to advising on the procurement of fixed rate investments, we have provided the following investment advisory services to our clients:  Review investment policies and practices;  Review and assess standard bidding documents;  Provide arbitrage rebate consulting;  Design money market funds; and  Construct individual portfolios. Because we work exclusively with public funds, we are quite sensitive to the risk-minimizing investment objectives of our public sector clients. Safety is further enhanced because PFM never takes possession of our clients’ securities or cash. These assets remain in the custody of each client’s custodian bank. PFM also carefully monitors relevant legal restrictions that have been or could be imposed on the funds we manage to insure that all such requirements are met. Bond Proceeds Investment. The provisions of the Tax Reform Act of 1986 and the arbitrage rebate regulations have made bond proceeds investment more complicated for tax-exempt bond issuers. PFM has developed innovative programs for investing bond proceeds that enable tax-exempt bond issuers to integrate arbitrage rebate considerations into investment strategies and to comply with the reporting requirements set forth by the arbitrage rebate regulations. These programs combine the convenience, accounting and cost-advantages of a short-term pool and the fixed return of a custom-designed portfolio of individual securities to maximize after-tax, or post rebate, earnings while complying with all aspects of the arbitrage rebate regulations. For a construction account, for example, target duration is derived from the draw down schedule, and funds may be invested in a laddered portfolio of securities and in a pooled liquidity vehicle. After the initial purchase of the portfolio, PFM monitors the draw down schedule through direct contact with client project managers or engineers, and continually updates cash flow projections. This active approach allows us to make appropriate adjustments to the portfolio so that assets and liabilities are properly matched, and earnings are maximized to the extent permitted by the arbitrage regulations. PFM Payment Solutions Procurement Card (P-Card) The PFM Payment Solutions Procurement Card Program (P-Card) is a cost-free payments mechanism, which eliminates the typical requisition process and related costs associated with purchasing materials and services. The P-Card, which is a special type of credit card, streamlines the purchase of supplies, furniture, utilities, and more, saving staff time and money for your entity. Participants in the PFM Payment Solutions Procurement Card Program receive cash rebates on their purchases if the total spend on the card equals or exceeds $50,000. The more items purchased using the card, the greater the rebate percentage. Rebates are calculated on 100% of total spending on the P-Card and include all large-ticket items. All purchases are eligible for the rebate. Arbitrage Rebate Compliance PFM provides arbitrage rebate calculation services to a diverse group of issuers located nationwide. We feel that our services are distinguished from others in that clients benefit not only from our rebate expertise but also from the combined financial advisory and investment advisory expertise that PFM brings to the table. The Tax Reform Act of 1986 created a great deal of confusion and concern among tax-exempt bond issuers interested in managing their funds efficiently while complying fully with the new tax law. Many issuers have tried to address this problem by placing their bond proceeds in low-interest-bearing devices. Others have bid out all their investments at once, and have ignored the investments thereafter. Unfortunately, these simplistic responses do not give issuers the interest revenues they require, the flexibility that is essential to financing a capital project, project, and, worst of all, may yet fall short of complying with the Tax Reform Act regulations. For example, an issuer who invests in low-yielding securities might be faced with the prospect of the U.S. Treasury demanding that the issuer calculate its rebate based on the investments it could have obtained. Scope of Services Flood Diversion Board of Authority | 6 Given this uncertain climate, issuers now recognize the importance of obtaining expert advice with regard to investing their funds and with regard to arbitrage and rebate compliance. Often the best resolution of an arbitrage rebate problem is an investment solution. For example, it may be possible to offset negative arbitrage in one fund by investing another fund at a high yield and blending the two. Or it may be efficient to invest in tax-exempt securities to earn income above the bond yield that is not subject to rebate. In both of these cases, PFM’s combined expertise in arbitrage rebate and investment can help assume not just that rebate rules are followed, but that net earnings are maximized. PFM works diligently to gather accurate information, discuss any questions with the issuer and/or its legal counsel, complete calculations, deliver reports, and maintain records. All work is completed upon receipt of all necessary documents and investment records in accordance with a schedule agreed to by the client. To make sure that filing deadlines specified in the Federal Tax Code will be met, we maintain complete records of pertinent filing dates about each transaction. PFMAM has worked with leading bond counsel firms across the nation on tax-exempt financings ranging from several hundred thousand dollars to $700 million. Our approach to working with bond counsel firms is simple: PFMAM turns to bond counsel to interpret the provisions of the Internal Revenue Code with respect to the client’s bond issue. Based on these interpretations, PFM prepares all of the mathematical computations necessary to compute the arbitrage rebate amount, if any, on the bonds. This report is then submitted to bond counsel which reviews PFMAM’s methodology, and based on this review, issues a letter of comfort to the issuer stating that the methodology employed to calculate the yield on the bonds, the yield on the investments and the arbitrage rebate amount (if any), is in compliance with federal tax law. Bond counsel’s role is to continue such reviews on an annual basis. PFM does not use canned third-party software. Instead, we have produced internal software and, as appropriate, we develop customized models to address the particular circumstances of individual issuers. All such analyses are checked carefully and conform to industry standards. From our clients’ perspectives, the value of this careful analysis is in having the highest possible degree of confidence that calculations are completed accurately and that all options for minimizing rebate are identified and explored. Using canned programs, which are inherently limited in their scope, cannot provide the same comfort or value. PFM’s sophisticated accounting and reporting system provides accurate and up-to-date reports on each issuer’s investment portfolio(s). These reports are furnished to bond counsel for use in its annual review. Fee Schedule Flood Diversion Board of Authority | 7 Retainer For the period from August 1, 2012-September 30, 2013, PFM proposes a retainer of $10,000 per month. Expenses Expenses that PFM would expect to be reimbursed for include, but are not limited to, travel, meals, lodging, express mail or other overnight delivery services, multi-party conference calls that we arrange, color printing and any special database or wire service searches or services. Fees for Additional Services Fees for services described in “Additional Services” or related to an actual P3 transaction would be confirmed in a separate engagement letter or contract between PFM Asset Management LLC or Public Financial Management, Inc. and the Authority at the time the need for such services is identified.