Bakersfield City Council
July 23, 2025

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13 Rate Covenant
The City covenants in the Master Indenture as follows (referred to herein as the “Rate Covenant”):
(a) The City shall, while any of the Bonds remain Outstanding (but subject to all existin g contracts and legal obligations of the City as of the date of execution of the Master Indenture setting forth restrictions relating thereto), fix, prescribe, revise, and collect rates, fees, and charges for the services and facilities furnished by the En terprise during each Fiscal Year, with the approval of the City Council with respect to rates, which are at least sufficient, after making allowances for contingencies and error in the estimates, to yield Net Revenues sufficient to pay the following amount s in the following order of priority:
(i) the Aggregate Annual Debt Service on any Outstanding Bonds required to be funded by the City in such Fiscal Year as required by the Master Indenture or any Supplemental Indenture with respect to the Outstanding Bonds;
(ii) the required deposits to any Debt Service Reserve Fund which may be established by a Supplemental Indenture;
(iii) the reimbursement owed to any Credit Provider or Liquidity Provider as required by a Supplemental Indenture and the related Credit Facility and Liquidity Facility, and any Debt Service Reserve Fund Surety Policy;
(iv) the interest on and principal of any indebtedness required to be funded during such Fiscal Year other than for Outstanding Bonds, but including Subordinate Obligations; (v) payments of any reserve requirement for debt service for any indebtedness other than Outstanding Bonds, but including Subordinate Obligations; and (vi) all payments required to meet any other obligations of the City which are charges, liens, encumbran ces upon, or which are otherwise payable from, the Revenues during such Fiscal Year.
(b) The City further agrees that it will establish, fix, prescribe, revise, and collect rates, fees, and charges for the services and facilities furnished by the Enterpris e, so that during each Fiscal Year the Net Revenues, together with any amounts released from the Rate Stabilization Fund and permitted to be used, will be equal to at least 125% of Aggregate Annual Debt S ervice on the Outstanding Bonds . For purposes of the foregoing, the amount of moneys on deposit in the Rate Stabilization Fund taken into account and considered Net Revenues for purposes of the calculation described above shall not exceed 25% of the Aggregate Annual Debt Service on all Outstanding Bonds in such Fiscal Year. (c) The City also covenants that if Net Revenues in any Fiscal Year are less than the amount specified in paragraph (a) or (b) above, the City will retain and direct a Consultant to make recommendations as to the revision of the City’s wastewater business operations and its schedule of rates, fees, and charges for the services and facilities furnished by the Enterprise, and after receiving such recommendations or giving reasonable opportunity for such recommendations to be made, the City s hall take all lawful measures to revise the schedule of rates, fees, and charges for the services and facilities furnished by the Enterprise as may be necessary to produce Net Revenues, after taking into account any permitted amounts on deposit in the Rate Stabilization Fund in accordance with the Master Indenture, in the amount specified in such paragraphs (a) and (b), as applicable, in the next succeeding Fiscal Year.

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14 (d) In the event that Net Revenues for any Fiscal Year are less than the amount specifie d in paragraph (a) or (b) above, but the City promptly has taken prior to or during the next succeeding Fiscal Year all lawful measures to revise the schedule of rates, fees, and charges for the services and facilities furnished by the Enterprise as required in paragraph (c) above, such deficiency in Net Revenues shall not constitute an Event of Default under the Master Indenture. Nevertheless, if after taking the measures required in paragraph (c) above to revise the schedule of rates, fees, and charges fo r the services and facilities furnished by the Enterprise, Net Revenues in the second succeeding Fiscal Year (as evidenced by the audited financial statements of the City for such Fiscal Year) are less than the amount specified in paragraphs (a) and (b) above, such deficiency in Net Revenues shall constitute an Event of Default under the provisions of the Master Indenture.

Certain Other Covenants of the City
In addition to the Rate Covenant described above, the City has made several other covenants in the Master Indenture and the Sixth Supplemental Indenture, including, but not limited to, the following:

Punctual Payment of Principal and Interest. The City covenants in the Master Indenture that it will duly and punctually pay or cause to be paid from the Net Revenues and to the extent thereof the principal of, premium, if any, and interest on every Bond at the place and on the dates and in the manner set forth in the Master Indenture and any Supplemental Indentures, and as specified in the Bonds, according to the true intent and meaning thereof, and that it will faithfully do and perform all covenants and agreements contained therein; provided that the City’s obligation to make payment of the principal of, premium, if any, and interest on the Bonds shall be li mited to payment from the Net Revenues, the funds and accounts pledged therefor in the Master Indenture, and any other source that the City may specifically provide for such purpose and no Owner shall have any right to enforce payment from any other funds of the City. Nothing contained in the Master Indenture shall prevent the City from making advances of its own moneys howsoever derived to any of the uses or purposes referred to therein.

Senior Lien Obligations Prohibited. The City covenants in the Master Indenture that so long as any Bonds are Outstanding under the Master Indenture, the City will not issue any additional bonds or other obligations with a lien on or security interest granted in Net Revenues that is senior to the Bonds.

Maintenance of Powers. The City covenants in the Master Indenture that it will at all times use its best efforts to maintain the powers, functions, duties, and obligations now reposed in it pursuant to the Bond Law and all other laws and that it will not at any time voluntaril y do, suffer, or permit any act or thing the effect of which would be to delay either the payment of the indebtedness evidenced by any of the Bonds or the performance or observance of any of the covenants contained in the Master Indenture.

Operation and Maintenance of the Enterprise. The City covenants in the Master Indenture that the Enterprise shall at all times be operated and maintained in good working order and condition and that all lawful orders of any governmental agency or authority having jurisdic tion in the premises shall be complied with (provided the City shall not be required to comply with any such orders so long as the validity or application thereof shall be contested in good faith), and that all licenses and permits necessary to construct or operate any part of the Enterprise shall be obtained and maintained and that all necessary repairs, improvements, and replacements of the Enterprise shall be made, subject to sound business judgment. The City will maintain the Enterprise in efficient ope rating condition and make such improvements, extension, enlargements, repairs, and betterments to the Enterprise as may be necessary or advisable for its economical and efficient operation at all times and to supply reasonable public and private demands for Enterprise services within the Service Area of the Enterprise. The City shall employ experienced and competent personnel to manage the Enterprise. The City shall, from time to time, duly pay and discharge, or cause to be paid and discharged, except to th e extent the imposition or payment

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15 thereof is being contested in good faith by the City, all taxes (if any), assessments, or other governmental charges lawfully imposed upon the Enterprise or upon any part thereof, or upon the Revenues or Net Revenues, when the same shall become due, as well as any lawful claim for labor, materials, or supplies or other charges that, if unpaid, might by law become a lien or charge upon the Revenues or Net Revenues or the Enterprise or any part thereof constituting part of the Enterprise.

Accounts. The City covenants in the Master Indenture that it will keep and provide accurate books and records of account showing all Revenues received and all expenditures of the City and that it will keep or cause to be kept accurate books and records of account showing all moneys, Revenues, accounts, and funds (including the Wastewater Treatment Fund and all funds and accounts provided for in the Master Indenture) that are or shall be in the control or custody of the City; and that all such books and records pertaining to the Enterprise shall be open upon reasonable notice during business hours to the Trustee, the Credit Provider, and the Liquidity Provider, and to the Owners of not less than 10% of the Principal Amount of Bonds then Outstan ding, or their representatives duly authorized in writing. Within 270 days after the close of each Fiscal Year, so long as any of the Bonds remain Outstanding, the City will prepare audited financial statements including a statement of the income and expenses for such Fiscal Year and a balance sheet prepared as of the close of such Fiscal Year for the City all accompanied by a certificate or opinion in writing of an independent certified public accountant of recognized standing, selected by the City, which opinion shall include a statement that said financial statements present fairly in all material respects the financial position of the City and are prepared in accordance with generally accepted accounting principles.

Insurance; Application of Insurance Proceeds. The City covenants in the Master Indenture that, subject, in each case, to the condition that insurance is obtainable at reasonable rates and upon reasonable terms and conditions:
(a) the City shall procure and maintain or cause to be procured and maintained commercial insurance or provide Qualified Self-Insurance (as defined below) with respect to the facilities constituting the Enterprise and public liability insurance in the form of commercial insurance or Qualified Self - Insurance and, in each ca se, in such amounts and against such risks as are, in the judgment of the City, prudent and reasonable taking into account, but not being controlled by, the amounts and types of insurance or self-insured programs provided by similar municipal wastewater systems; and (b) the City shall send written notice to the Trustee, annually within 120 days after the close of each Fiscal Year of any change in its insurance policies and self -insured programs then in effect with respect to the Enterprise and the operations of the City. “Qualified Self-Insurance” is defined in the Master Indenture as insurance maintained through a program of self-insurance or insurance maintained with a fund, company, or association in which the City may have a material interest and of whi ch the City may have control, either singly or with others. Each plan of Qualified Self -Insurance shall be established in accordance with law, shall provide that reserves be established or insurance acquired in amounts adequate to provide coverage which th e City determines to be reasonable to protect against risks assumed under the Qualified Self -Insurance plan, including any potential retained liability in the event of the termination of such plan of Qualified Self -Insurance, and such self-insurance program shall be reviewed at least once every 12 months by a Consultant who shall deliver to the City a report on the adequacy of the reserves established thereunder. If the Consultant determines that such reserves are inadequate, it shall make a recommendation as to the amount of reserves that should be established and maintained, and the City shall comply with such recommendation unless it can establish to the satisfaction of and receive a certification from a Consultant that a lower amount is reasonable to provide adequate protection to the City.

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16 If, as a result of any event, any part of the Enterprise is destroyed or severely damaged, the City shall create within the Wastewater Treatment Fund a special account and shall credit the net proceeds received as a re sult of such event of damage or destruction to such account and such net proceeds shall, within a reasonable period of time taking into account any terms under which insurance proceeds are paid and any insurance restrictions upon the use or timing of the u se of insurance proceeds, be used to:
(i) repair or replace the Enterprise, or portion thereof, which was damaged or destroyed, (ii) provide additional revenue-producing projects of the Enterprise, (iii) redeem Bonds, or (iv) create an escrow fund pledged to pay specified Bonds and thereby cause such Bonds to be deemed to be paid as provided in the Master Indenture; provided, however, that the City shall first deliver to the Trustee a certificate of a Consultant showing that, after taking into account the u se of the net proceeds for the redemption of such specified Bonds, the test described in paragraphs (a) and (b) under the caption “Rate Covenant” above would, nevertheless, be met.

Protection of Security and Rights of Owners. The City covenants in the Mast er Indenture that it will preserve and protect the security of the Bonds and the rights of the Owners of any Bonds. From and after the sale and delivery of any Bonds by the City, the Bonds shall be incontestable by the City.

Limitation on Use of Proceeds. The City covenants in the Master Indenture to make no use of the proceeds of the Bonds which would cause the Bonds to be “private activity bonds” that are not “qualified private activity bonds” under and within the meaning of Section 141(d) of the Code. Without limiting the generality of the foregoing, the City shall not enter into any arrangement or agree to enter into any arrangement the effect of which would be to cause more than five percent of the proceeds of the Bonds to be used directly or indirectly to make or finance loans to persons other than governmental units.

Arbitrage Covenant. The City covenants in the Master Indenture with the Owners of all Bonds at any time Outstanding issued as Bond the interest on which is excluded from gross income for f ederal income tax purposes that it will make no use of the proceeds of the Bonds which if made at the time of issuance of the Bonds, would have caused any of the Bonds to be “arbitrage bonds” subject to federal income taxation by reason of Section 148 of the Code.

Competing Enterprise. The City covenants in the Master Indenture that, unless contrary to any provision of, or required by applicable law, as long as Bonds are outstanding, the City will not grant any franchise or license to a competing utility sy stem, or permit any person, association, firm, or corporation to sell similar wastewater treatment services or facilities to any consumer, public or private, within the Service Area of the Enterprise; provided, however, that nothing shall prevent the City from annexing land into its boundaries solely due to the fact that there is a competing utility system or person, association, firm, or corporation selling similar utility services or facilities within or for the land to be annexed.

Notwithstanding the foregoing, permits granted to individual homeowners shall not violate this covenant if the City is in compliance with the Rate Covenant as described herein.

Alienating Enterprise. The City covenants in the Master Indenture that, while Bonds are Outstanding, t he City shall not, except as permitted below, transfer, sell or otherwise dispose of the Enterprise or assets of the Enterprise financed with the proceeds of Bonds or any Subordinate Obligation.

For purposes of this covenant, any transfer of an asset over which the City retains or regains substantial control shall not, for so long as the City has such control, be deemed a disposition of the Enterprise.

The City may transfer, sell or otherwise dispose of the Enterprise or assets of the Enterprise only if such transfer, sale or disposition complies with one or more of the following provisions:
(a) the property being disposed of is, in the City’s sole discretion, surplus, unnecessary, inadequate, obsolete or worn out; or

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17 (b) the property proposed to be disposed of and all other property of the Enterprise disposed of during the 12 -month period ending on the day of such transfer (but excluding property disposed of under clause (a) above), will not, in the aggregate, constitute a Significant Portion of the Enterpri se determined as described below and the proceeds are deposited into the Wastewater Treatment Fund to be used as described below; or
(c) the City receives fair market value for the property, the proceeds are deposited into the Wastewater Treatment Fund to be used as described below and, prior to the disposition of such property, there is delivered to the Trustee a certificate of a Consultant to the effect that notwithstanding such disposition, but taking into account the use of such proceeds in accordance w ith the expectations of the City as evidenced by a certificate of the City, the Consultant estimates that the City will be in compliance with the Rate Covenant during each of the five Fiscal Years immediately following such disposition.

The “Significant Portion” is defined in the Master Indenture as property of the Enterprise which, if such property had been disposed of by the City at the beginning of the Fiscal Year which includes the month of commencement of the 12 -month period referred to in clause (b) above would have resulted in a reduction in Net Revenues for such Fiscal Year of more than 4% when the actual Net Revenues for such Fiscal Year are decreased by the revenues directly attributable to such property of the Enterprise and increased by the Operation and Maintenance Costs of the City directly attributable to such property of the Enterprise.

Proceeds of the disposition of assets under clause (a) above shall be deposited in any manner the City determines to be in the best interests of the City. Proc eeds of the disposition of assets under clause (b) or (c) above shall be deposited into the Wastewater Treatment Fund and used, within a reasonable period of time, not to exceed five years, to (i) provide additional revenue-producing properties to the Enterprise or pay for Operation and Maintenance Costs, (ii) redeem Bonds, or (iii) create an escrow fund pledged to pay specified Bonds and thereby cause such Bonds to be deemed to be paid as provided in the Master Indenture.

Properties of the Enterprise that were financed with the proceeds of obligations the interest on which is then excluded from gross income for federal income tax purposes shall not be disposed of, except under the terms of clause (a) above, unless the City has first received a written opini on of Bond Counsel to the effect that such disposition will not cause the interest on such obligations to become includable in gross income for federal income tax purposes.

No such disposition shall be permitted which would cause the City to be in default of any other covenant contained in the Indenture.

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18 Estimated Debt Service on Outstanding Bonds
The following table details the principal and estimated interest due with respect to the Series 2020A Bonds and the Series 2025A Bonds.

Fiscal
Year
Ending
June 30
Principal
Payments for
Series 2020A
Bonds
Interest
Payments for
Series 2020A
Bonds
Principal
Payments for
Series 2025A
Bonds
Interest
Payments for
Series 2025A
Bonds
Total Debt
Service on
Outstanding
Bonds
2026 - $526,250
2027 - 526,250
2028 - 526,250
2029 - 526,250
2030 - 526,250
2031 - 526,250
2032 $4,055,000 424,875
2033 6,470,000 161,750
Total $10,525,000 $3,744,125

Sources: City and Municipal Advisor.

THE CITY
The City is located at the southern end o f the San Joaquin Valley in the County, approximately 110 miles north of the City of Los Angeles and 290 miles south of the City and County of San Francisco.

The City covers over 150 square miles of land and an additional 162 square miles of land area is l ocated within the City’s sphere of influence.

The City is a regional center for industry, government, transportation, retail trade, medical services, and oil field operations. Major manufacturing activities include iron and steel fabrication, plastic foam products, food products, petroleum refining, and textiles. Bakersfield is one of the leading convention centers of the state and is the commercial hub of the County. As the County seat, it is the location of many county, state, and federal offices.

The metropolitan area has expanded considerably beyond the City limits. As of January 1, 2025, the estimated population of the County was 923,961 and the estimated population of the City was 419,238, according to the California Department of Finance. The Bakersfi eld Standard Metropolitan Statistical Area includes the entire County, as defined by the State Employment Development Department. See “APPENDIX B – City of Bakersfield Economic, Financial, and Demographic Information.”
The City’s general fund is not pledge d to secure payment of, and the taxing power of the City is not pledged for, the principal of and interest on the Series 2025A Bonds. The City has included its City of Bakersfield Annual Comprehensive Financial Report Fiscal Year Ended June 30, 20 23 (the “ City’s Audited Financial Statements”), as Appendix C to this Official Statement. The financial statements referred to in the preceding sentence have been audited by Brown Armstrong Accountancy Corporation, independent certified accounts , whose report with respect thereto also appears in Appendix C to this Official Statement. Brown Armstrong Accountancy Corporation has provided its consent to the inclusion in Appendix C of its report contained in the City’s Audited Financial Statements. The City has not requested that such auditor undertake any review or investigation concerning subsequent events with respect to such City’s Audited Financial Statements. See “CONTINUING DISCLOSURE” regarding the status of the City’s audited financial statements for the Fiscal Year ended June 30, 2024.

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19 THE ENTERPRISE
The City provides sewage collection, treatment, and disposal services throughout its service area, which encompasses approximately 124 square miles of the incorporated City and approximately 10 square miles of the unincorporated area within the County (together with such additional area as may be added to or serviced by the Enterprise, the “Service Area”) . The City currently operates two wastewater treatment plants – Wastewater Treatment Plant No. 2 and Wastewater T reatment Plant No. 3 (the “Plants”) – with a combined treatment capacity of 57 million gallons per day (“mgd”). The Plants, along with the other facilities comprising the City’s sewer collection system, constitute the Enterprise. The Wastewater Division of the City’s Department of Water administers the operation of the Enterprise.

In 1972 the National Pollution Discharge Elimination System (“NPDES”) was created in Section 402 of the Federal Water Pollution Control Act, as amended (the “Clean Water Act”). NP DES prohibits “[discharges] of pollutants from any point source into the nation’s waters except as allowed under an NPDES permit.” The program gives the United States Environmental Protection Agency (“USEPA”) the authority to regulate discharges into the n ation's waters by setting limits on the effluent that can be introduced into a body of water from an operating and permitted facility. USEPA has granted the California State Water Resources Control Board (the “State Board”) approval authority over the NPDE S permitting process and the State Board issues the orders through regional water quality control boards that allow discharge.

The City has a General Permit for discharges from Municipal Separate Storm Sewer Systems (MS4). The County and the City have joint coverage under the current permit and operate under a joint Storm Water Management Plan ( “SWMP”) that was written in 2014. The State Board is currently in the process of issuing a new updated NPDES permit. Once the State Board guidelines and permit ar e final, the City and the County will update pertinent documents including the joint SWMP.

In addition to the Plants, the City owns 1,114 miles of collection and conveyance lines, and 55 lift stations, two septage and grease receiving stations, a centraliz ed supervisory control and data acquisition (SCADA) system, two office buildings, fleet vehicles, and critical portable equipment.

The Enterprise currently operates well below design capacity. Each of the Plants have one or more, primary clarifier, trickli ng filter, aeration basin, and secondary clarifier offline, which can be brought into service should there be issues with the primary equipment or in the event of extreme increase in influent flow. Each Plant has back -up generators to continue to operate c ritical equipment during a power outage. The collection system currently does not have a built-in redundancy; however, the City plans to mobilize portable equipment should additional capacity be required.

Wastewater Treatment Plant No. 2
Wastewater Treatment Plant No. 2 serves the central and eastern portions of the City, as well as surrounding unincorporated areas, including areas within the jurisdiction of the Kern Sanitation Authority (formerly the Union Avenue County Sanitation District) and the East Ni les Community Services District.

A portion of the area currently served by Wastewater Treatment Plant No. 2 are areas previously served by the City’s Wastewater Treatment Plant No. 1, which was decommissioned in 1980. Wastewater Treatment Plant No. 2 was originally completed and placed into service in 1952 with a design capacity of

16.0 mgd maximum monthly flow. Wastewater Treatment Plant No. 2 was upgraded in 1978 to a secondary treatment plant, and again in 2000 to its present design capacity of 25.0 mgd (daily dry weather average), as permitted by waste discharge requirements special order no. RS 2009-0122 issued by Central Valley Regional Water Control Board.

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20 Wastewater Treatment Plant No. 3
Wastewater Treatment Plant No. 3 is located west of State Route 99 in the southern portion of the City, west of Ashe Road between McCutchen Road and Taft Highway. The plant currently serves the northwest, west, and southwest portions of the City , as well as surrounding unincorporated areas .

Wastewater Treatment Plant No. 3 was originally constructed in 1972 as a water pollution control facility with a 4 mgd capacity. In 1984, the City expanded the treatment capacity of Wastewater Treatment Plant No. 3 to 8 mgd. In 1988, the City expanded the capacity of Wastewater Tr eatment Plant No. 3 to 12 mgd.

In 1997, the City expanded the capacity of Wastewater Treatment Plant No. 3 to 16 mgd. The City also upgraded Wastewater Treatment Plant No. 3’s cogeneration facility in 1998 and the headworks facility in 2002. In 2010, t he C ity expanded the capacity of Wastewater Treatment Plant No. 3 to 32 mgd.

Wastewater Treatment No. 3 is currently permitted for its total daily discharge flow capacity of 32 mgd (daily dry weather average ) based on Waste Discharge Requirements Special Order No. RS-2009-0087 issued by the Central Valley Regional Water Control Board.

Wastewater Treatment Process
A description of the wastewater treatment system employed by each plant, by major process units, is presented below.

Wastewater Treatment Plant No. 2 – Wastewater Treatment Process Preliminary Treatment . The preliminary treatment includes a headworks structure, wastewater pumping station, and an aerated grit chamber. Wastewater enters the headworks and passes through two mechanical bar screens that remo ve large debris, rags, sticks, and other objects that may damage equipment used in the treatment process, after which it flows to an influent wet well, where pumps lift the wastewater to a higher elevation so that it may flow through the plant by gravity. The wastewater then passes through one of two aerated grit chambers that continuously remove inorganic grit and sand particles, which are conveyed to a bin for disposal. The wastewater then flows by gravity to one of three primary clarifiers.

Primary Treatment. Primary treatment consists of three primary clarifiers, where settleable and floatable organic solids are removed. The solids removed are pumped to the sludge handling facilities.

The remaining liquid portion is pumped to the trickling filters for secondary treatment.

Secondary Treatment . The trickling filters distribute the wastewater over the honeycomb -like plastic filter media that is covered with a thin bacterial growth. Microorganisms grow on the media and absorb much of the organic content found in the wastewater. When the growth becomes too large, it breaks off and is passed to the next phase of treatment.

Final Treatment . Final treatment consists of three secondary clarifiers, where settleable and floatable organic solids are removed. The solid s removed are pumped to the sludge handling facilities.

The remaining liquid portion is pumped to storage reservoirs.

Effluent Disposal Facilities . After secondary treatment, the final effluent is stored in storage reservoirs for irrigation use at regulated rates on City-owned farmland.

Sludge Handling Facilities . Sludge that settled in the primary clarifiers is pumped to three anaerobic digesters. The sludge in the digesters is heated and mixed as part of the treatment process to convert the sludge to class B biosolids and creates methane gas. The treated sludge is discharged to sludge

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21 drying beds. The biosolids are disposed of as fertilizer on the City -owned farmland. Methane gas is used to power the plant’s cogeneration engines.

Standby Power . Two Caterp illar propane -fired and one Perkins diesel -fired engines provide emergency power to Wastewater Treatment Plant No. 2 in the event of a power outage. The sizes are: 520 kilowatt, 520 kilowatt, and 460 kilowatt.

Digester Gas Treatment & Power (Cogeneration). The cogeneration system is used to recover the energy available from the digester gas for plant use. A portion of the gas is fed to two digester gas -fired boilers that heat the digester sludge. The remainder of the gas is fed to one of two cogeneration e ngines, 400 kilowatts and 640 kilowatts, respectively, for electrical production; or burned off at a flare.

Odor Control. Raw wastewater produces hazardous and odorous gases. Such gases are collected and processed through one biofilter. The biofilter clean s the gas, preventing it from becoming a nuisance to the general public in the area.

Septage and Grease Receiving Station . Restaurant grease traps and septic tanks are serviced by septage and grease haulers. Such haulers discharge their waste at the septage and grease receiving station, where the grease and septage waste undergo treatment by the plant processes.

Wastewater Treatment Plant No. 3 – Wastewater Treatment Process Preliminary Treatment. Raw wastewater entering the plant first passes through three mechanical bar screens, where large objects are removed, after which it flows to an influent wet well, where pumps lift the wastewater to a higher elevation so that it may flow through the plant by gravity. The wastewater then passes through one of two vortex grit chambers that continuously remove inorganic grit and sand particles, which are conveyed to a bin for disposal. The wastewater then flows by gravity to one of eight primary clarifiers.

Primary Treatment . The wastewater, after screening and grit re moval, is distributed to eight primary clarifiers. The purpose of the primary clarification is to separate settleable solids from the wastewater by gravity as solids heavier than the liquid settle down (primary sludge) and are collected at the bottom of the clarifiers. Also, the materials lighter than the liquid will float on the surface (scum) and will be skimmed off. The effluent from these clarifiers is collected into a flow junction box and delivered to the plant's secondary process. The sludge scraped from the clarifier floor is conveyed to a sludge hopper located at the center of each clarifier. The primary sludge and scum are pumped to anaerobic digesters for further treatment.

Secondary Treatment. The effluent from the primary clarifiers is conveyed to the flow junction box and from there to the aeration basins. The purpose of the aeration basins is to support biological activities responsible for removing biochemical oxygen demand ("BOD") and nitrogen contents of the wastewater and also producing flo cs that settle well within the secondary clarifiers, thus removing suspended solids and BOD.

Secondary Clarifiers: The purpose of the secondary clarifiers it to separate the solids from the liquid by gravity as the solids heavier than the liquid settle dow n (sludge) and are collected at the bottom of the clarifiers. Also, the materials lighter than the liquid will float on the surface (scum) and will be skimmed off. Thus, clear water leaves the secondary clarifiers. Secondary clarifiers operate in a similar manner to primary clarifiers, the major difference being the lower density of the secondary sludge compared to that of the primary sludge. Secondary sludge is either recycled or treated by dissolved air flotation thickeners prior to anaerobic digestion.

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22 Effluent Disposal Facilities. After secondary treatment, the effluent is disposed of in one of three ways. First, the effluent can be sent to percolation ponds for groundwater recharge that are located on - site. Second, the effluent can be sent to a farm for irrigation; the farm is located near the 1-5 Highway and Taft Highway. Third, the effluent can undergo tertiary treatment.

Tertiary Treatment. Effluent from the secondary clarifiers undergoes filtration and disinfection to make California Title 22 water t hat may be recycled for multiple uses. Filtration takes place by a cloth media filter and can be enhanced with the use of poly -aluminum chloride, a chemical that causes coagulation of solids. After filtration, the water is injected with sodium hypochlorit e, a chemical that disinfects and kills unwanted pathogens in the water. After these stages, the tertiary water is stored in a three million gallon storage tank. The tertiary water can then be used for: plant water , irrigation water on- site, and irrigation water at the adjacent sports village complex owned by the City.

Sludge Handling Facilities . All sludge from the plant is eventually processed by one of six anaerobic digesters. There are two additional digesters that also act as storage tanks prior to dew atering.

The digested sludge from the digesters is transferred to centrifuges in the dewatering building by the centrifuge feed pumps. The centrifuges separate the digested sludge solids (cake) from the liquid (centrate). Sludge cake is discharged to a sys tem of collection screw conveyers for transfer by sludge hauling trucks. The sludge cake is then hauled away as fertilizer and is applied to City owned farm land.

The centrate is pumped back to the head works for processing through the plant.

Digester Gas Treatment & Power (Cogeneration). The cogeneration system is used to recover the energy available from the digester gas for plant use. A portion of the gas is fed to a flare to burn off. The remainder of the gas is fed to one of two cogeneration engines, b oth rated at 848 kilowatts, respectively, for electrical production.

Solar Panels . A solar panel energy field, generating one megawatt of power helps support the plant through peak electrical demand and helps reduce the plant’s utility bill.

Standby Power . Five Caterpillar diesel engines provide emergency power to Wastewater Treatment Plant No. 3 in the event of a power outage. The sizes of the engines are: 800 kW, 1000 kW, 1500 kW, and two engines at 2000 kW.

Odor Control. Raw wastewater produces hazardous and odorous gases. Such gases are collected and processed through one of three biofilters. The biofilters clean the gas, preventing it from becoming a nuisance to the general public in the area.

Septage and Grease Receiving Station . Restaurant grease trap s and septic tanks are serviced by septage and grease haulers. Such haulers discharge their waste at the septage and grease receiving station, where the grease and septage waste undergo treatment by the plant processes.

Insurance of Enterprise
The City sel f-insures, utilizing an internally established Self Insurance Fund to account for and finance its uninsured risks of loss related to torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees, and natural disasters. See “APPENDIX B – City of Bakersfield Economic, Financial, and Demographic Information – Insurance.”

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23 Management and Organization
The City’s Water Department (the “Water Department”), with 89 full time employees, is made up of two divisions. The functions of the Water Department are to manage the City’s water supply and water rights; operate the municipal water system; maintain storm water basins and river weirs within the City’s limits; and to monitor, operate, and maintain Wastewater Treatment Plant No. 2 and Wastewater Treatment Plant No. 3, sanitary sewer and storm drain systems.

The Wastewater Division of the Water Department is responsible for the day-to-day management, operation, and maintenance of the Enterprise. The Wastewater Division’s goals are to provide for the operation and maintenance of wastewater facilities for the purpose of treating, reclaiming, and utilizing wastewater and its byproducts in accordance with federal, state, and local requirements; to provide a healthy and nuisance -free envir onment; to plan for future wastewater treatment needs to meet the anticipated growth of the City; to monitor and regulate industrial waste discharges; and to establish sewer user fees for properties receiving City sewer service.

The Wastewater Division currently has 54 full time employees, of which 43 are directly involved in the operation and maintenance of the Plants. The Assistant Water Director – Wastewater, Wastewater Treatment Superintendent, and Wastewater Maintenance Superintendent are the t hree management positions in the Wastewater Division that are responsible for the day -to-day operations of the Plants. The other 11 administrative positions are a combination of engineers, inspectors, fiscal, and clerical staff.

All blue and white collar (non -supervisory) employees within the Wastewater Division are represented by the City of Bakersfield and the Kern County Employees Association, Inc., Local 700 of the Service Employees International Union, AFL/CIO. The current Memorandum of Understanding was approved April 26, 2023 by the Bakersfield City Council and it expire d on June 30, 2025. Terms of the existing Memorandum of Understanding will continue to apply until a new agreement is negotiated.

Wastewater Treatment Fund
Rates and Charges . The City has th e power to establish rates and charges for sewer service as needed, without the overview of any other governmental agency. Sewer service charges are collected in conjunction with property taxes by the County Auditor/Controller’s Office, except large capaci ty users that are billed by the City. Delinquent sewer service charges become a lien against property until paid.

The City establishes its sewer service charge as it adopts its annual budget, and advises the County Auditor each July of the amount of sewer service charges to be added to the property tax bills. In the Bighorn decision (as defined herein), the California Supreme Court determined that any increases in a city’s sewer service charge are subject to the public hearing requirements of Proposition 21 8, the “Right to Vote on Taxes Act,” approved by the voters of the State on November 5, 1996. The City believes that it is in compliance with these requirements. See “RISK FACTORS – Constitutional Provisions Affecting Enterprise Revenues and Expenditures.”
The County currently adds $0.2 0 to each wastewater service bill for billing and collection services. The City has the power to bill and collect charges directly rather than through the County, should it choose to do so. As described above, the City curre ntly directly bills and collects charges from certain large capacity users.

The Revenues collected and received by the Enterprise consist primarily of the following: sewer service charges, connection fees and developer contributions (which are collectively shown on the City’s

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24 financial statements “financing reimbursement”), rental income, septage dischar ge fees, and interest earnings.

Sewer service charges are expressed in terms of single -family dwelling equivalent (“SFDE”) service units. A SFDE service uni t is a measurement of demand on the sewerage system equivalent in flow and strength to the average sewage flow from a single -family dwelling. Single-family dwellings and other use properties are charged one SFDE service unit per parcel. The Enterprise serves the majority of the total metropolitan population. The remaining population is currently served by septic tanks and other sanitation districts. Sewer users in the City are primarily residential users, but also include commercial and industrial users.

The following table provides information with respect to SFDE service units and charges for Fiscal Years 2019-20 through 2024-25:

Wastewater Enterprise
SFDE Service Units and Charges
Fiscal Years 2019-20 through 2024-25
Fiscal Year SFDE Service Units (1)
Annual Sewer
Service Charge
2019-20 123,663 $215
2020-21 125,038 215
2021-22 126,418 215
2022-23(2) 123,302 220
2023-24 124,333 231
2024-25 124,241 239

(1) Data reflects actual SFDE Service Units as of the beginning of the applicable Fiscal Year. (2) In Fiscal Year 2022 -23, the SFDE service units for certain non -residential customers were consolidated to better reflect their allocated cost of service, which resulted in a decrease in SFDE service units from the prior Fiscal Year.

Source: City.

Sewer fees for commercial users al so include a surcharge, which recovers costs that exceed the amount of water consumption allowed for in the flat rate. Commercial users are classified into one of four user groups based on their wastewater strengt h: low, medium, medium -high, and high. The surcharge for these user groups ranges from $1.83 to $3.35 per 100 cubic feet of water. Sewer fees for permitted industrial users that do not fall into any of these user groups are charged based on flow, biochemical oxygen demand , and total suspended solids discharged as reported on quarterly reports .

Such surcharge is billed on a monthly basis by the City.

The City is required by Section 53756 of the Government Code of the State of California to adopt a schedul e of fees or charges every five years if it wishes to rel y on automatic cost adjustments . The annual sewer service charge for Fiscal Year 2025-26 is $247.13, which includes an automatic co nsumer price index adjustment. A consumer price index adjustment is also expected to be made to the annual sewer service charge for Fiscal Year 2026 -27. The City is expected, however, to conduct a costs of service study to determine rate increases that will go into effect starting Fiscal Year 2026-27.

Sewer service charges are collected annually on the special assessment portion of the ad valorem property tax statement. Delinquent amounts against a property result in a default status to that property.

These delinquent amounts are ultimately recovered when the property changes ownership.

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25 The City also establishes and maintains a schedule of sewer connection fees and fees for other services. The City currently charges a sewer connection fee of $6,947 per single family dwelling unit.

As of June 30, 20 24, there were approxi mately 104,981 accounts (parcels) in the Enterprise Service Area that are within the City limits. Some of these accounts have multiple connections, and as a result, there are more connections than accounts. The connections are converted to SFDE service uni ts by an equivalency factor. The SFDE service units are then used to determine the annual service charge for each account . Based upon charges for Fiscal Year 20 23-24, as of June 30, 20 24, the distribution of accounts versus connections and SFDE service units is as follows:

Wastewater Enterprise
Types of Sewer Users
As of June 30, 2024

Accounts Connections Equivalency
SFDE Service
Factor
Single Family Dwellings 90,936 90,983 1 90,983
Multiple Dwellings/Mobile Home 9,550 36,670 1 27,503
Schools (based on Average Daily Attendance)(1) 21 21 0 1 Hotels (based on number of rooms) 74 185 0 56
Hospital (based on number of beds) 7 7 1 4
Retirement Homes 45 45 2 68
Small Commercial 1,616 1,621 1 1,621
Large Commercial 2,732 2,732 2 4,098
TOTAL 104,981 132,264 124,333

(1) Totals for schools do not include public schools, which are billed directly by the City.

Source: City.

The table below sets forth the 10 largest Revenue contributors for Fiscal Year 2023-24.

Wastewater Enterprise
10 Largest Revenue Contributors
Fiscal Year 2023-24
Ratepayer Type of Business
2023-24 Sewer
Revenues
Percentage of
Total Revenue
Nestle Dreyer’s Grand Ice Cream Food Processing $1,076,669 2.83% Kern High School District Office Education 353,965 0.93 Knights Pumping Septage Hauler 250,288 0.66
Valley Pumping Septage Hauler 227,800 0.60
Panama Buena Vista School District Education 190,370 0.50 ETP Inc. Septage Hauler 147,900 0.39
Bakersfield City School District Education 111,958 0.29 United Site Services Septage Hauler 104,516 0.27
Kern Oil Industry 103,177 0.27
Kern County Sewer Septage Hauler 101,286 0.27

Total Revenue from the 10 largest rate payers $2,667,929 7.01% Total revenue from other customers $35,415,116 92.99%
Total Revenue (Fiscal Year 2023-24) $38,083,045 100.00%

Source: City.

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26 Capital Improvements to Enterprise
The following table summarizes the capital improvements of the Enterprise for Fiscal Years 2025-26 through Fiscal Year 2032 -33 that have been presented to the City Council . The City has budgeted the capital improvements for Fiscal Year 2025 -26 from funds on hand. The significant increases in capital expenditures in the later Fiscal Years relate to the major overhaul of Wastewater Treatment Plant No. 2 that is expected to be needed. Staf f is developing a funding strategy for these capital improvements that may include the issuance of additional bonds that are payable and secured by Net Revenues on a parity with the Series 2025A Bonds.

City of Bakersfield
Wastewater Enterprise
Planned Capital Improvements to Enterprise
Fiscal Year 2025-26 through Fiscal Year 2032-33
Fiscal Year Estimated Cost
2025-26 $7,720,000
2026-27 39,375,000
2027-28 41,735,000
2028-29 39,850,000
2029-30 113,350,000
2030-31 85,750,000
2031-32 274,800,000
2032-33 294,500,000

Source: City.

History of Revenues, Expenditures, and Debt Service Coverage The following table presents a description of the historical revenues and expenses attributable to the Enterprise and the related debt service coverage ratios for Fiscal Years 2020-21 through 2024-25. See also “APPENDIX C – City of Bakersfield Annual Comprehensive Financial Report Fiscal Year Ended June 30, 2023.” Fiscal Years 2023-24 and 2024-25 figures have not been audited. See “CONTINUING DISCLOSURE” herein.

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27 City of Bakersfield
Wastewater Enterprise
Historical Revenues, Expenditures, and Debt Service Coverage For Fiscal Years 2020-21 through 2024-25

FY 2020-21 FY 2021-22 FY 2022-23 FY 2023-24(1) FY 2024-25(1) Operating Revenues:

Charges for Service $34,568,527 $33,741,505 $36,172,143 $39,525,621 $39,116,690

Other Revenues 442,932 267,878 388,700 307,661 565,350

Total Operating Revenues 35,011,459 34,009,383 36,560,843 39,833,282 39,682,040

Less Operating Expenses (16,266,522) (16,353,050) (20,314,066) (22,587,679) (23,047,566)

Net Operating Revenues 18,744,907 17,656,333 16,246,777 17,245,603 16,634,474

Non-Operating Revenues:

Connection Fees 10,069,721 6,792,887 5,092,662 7,735,463 12,508,223(3)

Interest earnings / other 349,491 (911,012) 2,065,985 4,239,912 2,829,093

Total Non-Operating Revenues 10,419,212 5,881,875 7,158,647 11,975,375 15,337,316

Net Revenues Available for
Debt Service $29,164,119 $23,538,208 $23,405,424 $29,220,978

$31,971,790

Debt Service:

State Loan(2) $ 902,555 – – – –
Series 2015A Bonds 12,514,875 $12,567,000 $12,500,375 $12,544,250 $12,580,000 Series 2020A Bonds 390,302 526,250 526,250 526,250 526,250

Annual Debt Service $13,807,732 $13,093,250 $13,026,625 $13,070,500 $13,106,250 Debt Service Coverage Ratio 2.11x 1.80x 1.80x 2.24x 2.44x

(1) Unaudited.
(2) No longer outstanding.
(3) Large increase in Fiscal Year 2024-25 was due to the purchase of additional capacity by an industrial hazardous waste handling company.

Source: City.

Projection of Revenues, Expenditures, and Debt Service Coverage The following table presents a summary of the projected operating results of the Enterprise, together with debt service and debt service cov erage related to the Series 2025A Bonds. The projections are based on the following assumptions:

Assumption Regarding Projected Revenues and Expense . The projections assume 3.5% increases in revenues in each of the Fiscal Years shown and various increases in operating expenses each of the Fiscal Years shown that average an increase of 6.51% each Fiscal Year.

No Parity Obligations. The projections assume that the City will not issue any obligations payable from Net Revenues on a parity with the Series 2025A Bonds and the Series 2020A Bonds.

Projections are Forward Looking Statements. The projections constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward - looking statements are subject to r isks and uncertainties, which could cause actual results to differ materially from those anticipated. Factors that may cause actual results to differ from projected results might include, but are not limited to:

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28  Adverse changes in the demand for or the price of the services provided by the Enterprise;  Adverse changes in wastewater, water, or other utility law, policies, and regulation, including market structures and transmission planning;
 Any inability of the City or the Enterprise to obtain adequate and t imely rate relief and regulatory approvals from federal and state regulators;  Changes in federal and state environmental or utility regulations and enforcement that could increase the costs or limit the operations of the Enterprise;  Actions or activities at one or more of our Enterprise facilities that might adversely affect our ability to continue to operate such facility or to provide required Enterprise services;  Any inability to manage our Enterprise obligations and risks;  Adverse outcomes of any legal , regulatory, or other proceeding, settlement, investigation, or claim applicable to the Enterprise, the City, or the utility industry;  Any deterioration in the credit quality of the City or its obligations;  Availability of capital and credit at commercial ly reasonable terms and conditions and the ability of the City to meet cash or financing needs related to the Enterprise;  Changes in the cost of, or interruption in the supply of, fuel and other commodities necessary to the operation of the Enterprise facilities;
 Delays in receipt of necessary permits and approvals for the construction, development, or operational activities related to the Enterprise;
 Unforeseen cost escalations related to the construction, development, or operation of the Enterprise;
 Any inability to achieve, or continue to sustain, expected levels of operating performance of the Enterprise;
 Any equipment failures, accidents, severe weather events, or other incidents that impact the ability of the Enterprise to provide services to customers, and any inability to obtain sufficient insurance coverage or recover proceeds of insurance with respect to such events;  Acts of terrorism, cybersecurity attacks, or intrusions that could adversely impact the Enterprise;
 Increases in competition in the utility markets;
 Any inability to realize anticipated tax benefits or retain tax credits related to the Enterprise, if any;
 Challenges associated with recruitment and/or retention of a qualified workforce for the Enterprise; and

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29  Changes in customer behaviors , including increases or decreases in demand or usage of Enterprise services.

All of the projections made in the following table are qualified by these cautionary statements and the City makes no assurance that any of such projections will be realized. Inv estors are cautioned not to rely on these projections in making any investment decision. See also, “RISK FACTORS.” City of Bakersfield
Wastewater Enterprise
Estimated Revenues, Expenditures, and Debt Service Coverage For Fiscal Years 2025-26 through 2029-30

FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30
Operating Revenues:

Charges for Service $40,485,774 $41,902,776 $43,369,373 $44,887,301 $46,458,357

Other Revenues 585,137 605,617 626,814 648,752 671,458

Total Operating Revenues 41,070,911 42,508,393 43,996,187 45,536,054 47,129,815

Less: Operating Expenses (30,059,383) (32,554,251) (34,593,460) (36,546,530) (38,675,252)

Net Operating Revenues 11,011,528 9,954,142 9,402,727 8,989,524 8,454,563

Non-Operating Revenues:

Connection Fees 8,006,204 8,286,421 8,576,446 8,876,622 9,187,303

Interest earnings / Other 2,800,802 2,772,794 2,772,794 2,772,794 2,772,794

Total Non-Operating Revenues 10,807,006 11,059,215 11,349,240 11,649,416 11,960,098

Net Revenues Available for
Debt Service $21,818,534 $21,013,358 $20,751,967

$20,638,939

$20,414,661

Debt Service:

Series 2020A Bonds $526,250 $526,250 $526,250 $526,250 $526,250

Series 2025A Bonds(1) 11,848,083 11,899,250 11,915,375 11,999,375 11,995,375

Annual Debt Service $12,374,333 $12,425,500 $12,441,625 $12,525,625 $12,521,625

Debt Service Coverage Ratio 1.76x 1.69x 1.67x 1.65x 1.63x

(1) Preliminary; subject to change.

Source: City.

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30 RISK FACTORS
Investment in the Series 2025A Bonds involves risks that may not be appropriate for certain investors. The following is a discussion of certain risk factors that should be considered, in addition to other matters set forth herein, in evaluating the Series 2025A Bonds for investment. The information set forth below does not purport to be an exhaustive listing of the risks and other considerations that may be relevant to an investment in the Series 2025A Bonds. In addition, the order in which the following information is presented is not intended to reflect the relative importance of any such risks.

Series 2025A Bonds are Limited Obligations
The Series 2025A Bonds are payable solely from Net Revenues and amounts held in certain funds and accounts established under the Indenture. Consequently, the payment of principal of and interest on the Series 2025A Bonds will be dependent upon the availability and su fficiency of such Net Revenues.

The Series 2025A Bonds do not constitute an obligation of the City for which the City must levy or pledge any form of taxation or for which the City has levied or pledged any form of taxation. The Series 2025A Bonds do not constitute a debt or indebtedness of the City, the County, the State, or any political subdivision of the State, within the meaning of any constitutional or statutory debt limitation or restriction.

System Demand
There can be no assurance that the local demand for the services provided by the Enterprise will be maintained at levels described in this Official Statement. Bec ause of changes in demographics within the boundaries of the City, it is possible for the demand for wastewater services to decline over the term of the Series 2025A Bonds. A significant decline in demand might create a situation in which the City could not increase rates sufficiently to offset the decrease in subscribers or usage. This would reduce the City’s ability to make payments of the principal or interest due with respect to the Series 2025A Bonds.

Increased Regulations
The adoption by federal or St ate agencies of more regulations could reduce the amount of Net Revenues, which could in turn require substantial increases in rates or charges in order to comply with the Rate Covenant. A significant change in effluent standards , air and water quality control requirements and biosolids regulations for wastewater treatment imposed by law or regulation might cause the City to incur greater expenses of operation, thus creating a temporary or permanent inability to generate sufficient Net Revenues to pay the p rincipal and interest with respect to the Series 2025A Bonds when due. It is not possible to predict the timing or nature of more stringent operating standards that may be imposed upon the City over the term of the Series 2025A Bonds.

Increased System Expenses
Changes in technology, increases in the cost of energy, chemicals, or other expenses could reduce Revenues, which could in turn require substantial increases in rates or charges in order to comply with the Rate Covenant. The City’s ability to make it s debt service payments with respect to the Series 2025A Bonds may be adversely affected until such time as the City is able to increase rates and charges to pay for such increased costs.

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31 Cybersecurity
The City relies on computers and technology to conduct its operations, including the Enterprise.

The City and its departments face cyber threats from time to time including, but not limited to, hacking, viruses, malware and other forms of technology attacks. The City owns and operates its own enterprise class data network serving the municipal city government and its operations. The City has retained information technology professionals to support, maintain and protect these operations locally in a purpose-built and physically secure environment. This network and its operations are governed by and in compliance with all applicable governmental regulations as well as the City’s own administrative regulations. Within the City’s operations and guidance is an active cyber -security program designed to protect fro m, and to quickly identify and mitigate, a multitude of complex security threats. While no network is completely immune from all possible compromise, the City exercises its due diligence in protecting the data it possesses and the systems it operates. To date, there have been no significant cyber- attacks on the City’s computers and technologies.

While the City is routinely maintaining its technology systems and continuously implementing new information security controls, no assurances can be given that th e City’s security and operational control measures will be successful in guarding against all cyber threats and attacks. The results of any attack on the City’s computer and technology could negatively impact the City’s operations, and the costs related to such attacks could be substantial. The City maintains cybersecurity insurance coverage.

Natural Disasters
The occurrence of any natural disaster in the City, including, without limitation, fire, earthquake, landslide, high winds, drought or flood, could have an adverse material impact on the economy within the City, the Enterprise and the revenues available for the payment of the Series 2025A Bonds. Portions of the Enterprise may be at risk of damage or destruction from wildfires or subject to unpredictable seismic activity.

The occurrence of natural disasters in the City’s service area could result in substantial damage to the Enterprise which, in turn, could substantially reduce revenue generated by the Enterprise and affect the ability of the City to pay the Series 2025A Bonds.

The City is currently compliant with the America’s Water Infrastructure Act of 2018 (“AWIA”).

The City’s Water Department prepared Risk and Resilience Assessments (“RRA”) for water and wastewater infrastructure, which were certi fied by the Environmental Protection Agency (“EPA”) on August 15, 2024. RRAs evaluate the various malevolent and natural hazards that could impact the water or wastewater systems, including but not limited to:
• Earthquakes, Floods, Wildfires,
• Cyber Attack, Water Contamination, Chemical Storage
As part of the AWIA compliance, the City’s Water Department also had to prepare an Emergency Response Plan (“ERP”), which was certified by the EPA on January 31, 2025. The ERP covers roles and responsibility of s taff during emergencies, response procedures for various situations, mitigation actions and strategies to address hazards. Water Department utilized the Kern County Multi -Jurisdiction Hazard Mitigation Plan (“HMP”) to identify hazards that were considered and evaluated in the RRAs and ERP.

With respect to wildfire hazards, the HMP identifies the areas within City limits that have moderate exposure to wildfire. To mitigat e the spread of wildfire in these areas, the City’s Water

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32 Department staff cut fire lines in the northeast, as directed by the City of Bakersfield Fire Department. In addition, the City’s and Kern County ’s Fire Departments schedule and facilitate controlled burns within areas of concern.

Seismic Activity
The Indenture does not require th e City to maintain earthquake insurance on the Enterprise.

However, the area in and around the City, along with much of the State, shares a history of seismic activity and is thus listed as a “Zone 4” earthquake area in the Uniform Building Code. A Zone 4 designation has the most restrictive design requirements for new construction. The City standards for development have been designed to reduce the risk to the public and adequately mitigate seismic hazards.

There are no known major faults within the City; however, there are several faults, including the San Andreas Fault and the White Wolf Fault, that are considered active faults, and are located approximately 40 miles from the City. Activity along these faults could potentially result in damage to the buildings, roads, bridges, and property within the City in the event of a major earthquake. The Kern County earthquake of 1952, which occurred on the White Wolf Fault, caused considerable and widespread damage within the City and the surrounding areas. No structural damage occurred in the City, however, as a result of the 1989 Loma Prieta earthquake, the Landers and Big Bear earthquakes of June 1992, or the Northridge earthquakes of January 1994.

If a major earthquake were to occur, it may substantially damage or destroy the Enterprise or portions of it. In such a case, under certain circumstances, the Revenues of the Enterprise could possibly be reduced or eliminated if the City was unable to provide wastewater services to its customers, or if the City was required to apply large amounts of Revenues to make extensive repairs to the Enterprise. Such a reduction or elimination of Revenues could impair the ability of the City to make payments of principal or interest with respect to the Series 2025A Bonds when due.

The chance that the occurrence of severe seismic activity in the area of the Enterprise could result in substantial damage and interference with the City’s right to use all or a portion of the Enterprise, and result in a reduction or elimination of Net Re venues, is mitigated by the above -discussed development standards.

Flood
Lake Isabella is located 40 miles northeast of the City, and consists of an earthfill main dam and auxiliary dam across the Kern River and Hot Springs Valley, respectively. The dam was authorized under the Flood Control Act of 1944 and construction was completed in 1953. The reservoir provides flood-risk management, irrigation and recreational benefits. With more than 300,000 people living and working below the dams, primarily in the town of Lake Isabella and the City, the U.S. Army Corps of Engineers (“USACE”) began a dam safety modification study in 2006 to address seismic, hydrologic (potential over-topping during an extreme flood event) and seepage issues at the dams.

Following the signing of the Record of Decision in December 2012, USACE entered the Pre - Construction Engineering and Design phase of the project, and from 2013 to 2016, focused on design improvements to the existing dams and the relocation of U.S. Forest Service buildi ngs located in the excavation footprint. Construction of the USFS warehouse/administrative buildings in Kernville and the USFS fire station in Lake Isabella were completed in 2017. In September 2017, USACE awarded a $204 million contract to Flatiron/Dragados/Sukut Joint Venture of Benicia, California, to construct the Phase II dams and spillways modifications. Phase II was substantially completed in 2022.

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33 Phase III construction is currently underway. It includes the construction of a new Isabella Lake Visitor Center operated by the U.S. Forest Service, which is anticipated to be completed January 2026, as well as dam operations support facilities.

The City cannot guarantee that the dams will not fail.

According to the United States Federal Emergency Management Agency’s flood zone maps, most of the land within the City boundary is classified as Zone X. Zone X areas are determined to be outside the 500-year floodplain and the 1% and 0.2% annual chance of floodplains.

Wildfire Conditions
In recent years, porti ons of California have experienced wildfires that have burned thousands of acres and destroyed thousands of homes and structures, even in areas not previously thought to be prone to wildfires. Such areas affected by wildfires are more prone to flooding an d mudslides that can further lead to the destruction of homes. There can be no assurances that wildfires won’t occur within the Service Area. Property damage due to wildfire could result in a significant decrease in the market value of property in the City and in the ability or willingness of property owners to pay property taxes when due including the service charges of the Enterprise.

Global Health Emergencies
A pandemic, epidemic or outbreak of an infectious disease can have significant adverse health and financial impacts on global and local economies. For example, beginning in 2020, the COVID 19 pandemic negatively affected economic activity throughout the world, including the United States and the State of California. The initial impacts of stay -at home orders globally were unprecedented, with commerce, travel, asset values and financial markets experiencing disruptions worldwide. Due to the essential nature of the Enterprise, the City did not experience a significant, materially adverse impact on its annual revenues or operations as a result of COVID 19. Moreover, while the declarations of COVID 19 as a public health emergency have been lifted, future pandemics and other widespread public health emergencies can and do arise from time to time. The City cannot predict whether another national or localized outbreak of highly contagious or epidemic disease in the future could negatively impact the City’s operations and finances and/or the economy of its service area.

Federal Policy Risks Generally
Federal policies involving taxation, appropriations, borrowing (including the federal debt ceiling), climate change and other environmental matters, clean energy, trade (including tariffs), and other topics can shift, sometimes dramatically, from one Administration or Congress to another and such policy shifts may be inconsistent with the policy priorities of the State and/or the City. Recently, the new federal Administration has begun implementing several such policy shifts, including, among other things, through the revocation of certain policy initiatives of the prior federal administration, delays in appropriations, and instructing the Attorney General to identify and take certain action to limit the enforcement of State and local laws, regulations, causes of action, policies, and practices burdening the development, production or use of domestic energy resources that are determined to be unconstitutional, preempted by federal law or otherwise unenforceable, prioritizing those relating to climate change, environmental, social and governance initiatives, environmental justice, carbon or greenhouse gas emissions. Such policy shifts have been proposed or promulgated through presidential executive orders and other official and unofficial actions at the federal level. Certain of these actions have been the subject of judicial challenges. In addition to shifts in federal policy, the federal government has recently begun conducting large-scale layoffs across federal agencies, which may also impact the work and func tion of

46738.00002\43742981.6

34 such entities. While the City does not generally rely upon or receive significant federal funding, the work of various federal agencies does affect the conduct of its operations. As one example, the United States Environmental Protection Agency, among other things, is responsible for, developing federal standards for water quality, and provides regulatory compliance guidance and testing protocols in connection therewith. The City is unable to predict with certainty the outcome of the recent federal executive orders, proposals or other policy actions, nor the potential impact (positive or negative) any such changes in federal policy may have on the City’s future operations.

Self-Insurance
The City self -insures, utilizing an internally established S elf Insurance Fund to account for and finance its uninsured risks of loss related to torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees, and natural disasters. However, no assurance can be given that such self-insurance at the time of any casualty or loss will be adequate to cover any claims that might arise. See “APPENDIX B – City of Bakersfield Economic, Financial, and Demographic Information – Insurance.” Limitations on Available Remedies and the City’s Ability to Generate Net Revenues The ability of the City to comply with its covenants under the Indenture and to generate Net Revenues sufficient to pay principal of and interest on the Series 2025A Bonds may be adversely affected by actions and events outside of the control of the City and may be adversely affected by actions taken (or not taken) by voters, property owners, taxpayers, or payers of assessments, fees, and charges. See “ – Constitutional Provisions Affecting Enterprise Revenues and Expenditures” below. Furthermore, any remedies available to the Owners of the Series 2025A Bonds upon the occurrence of an event of default under the Indenture are in many respects dependent upon judicial actions which are often subject to discretion and delay and could prove both expensive and time consuming to obtain.

In addition to the limitations on remedies contained in the Indenture, the rights and obligations under the Series 2025A Bonds and the Indenture may be subject to bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium, and other laws relating to or affecting creditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriate cases, and to limitations on legal remedies against charter cities in the State. The opinion to be delivered by Kutak Rock LLP, bond counsel, concurrently with the issuance of the Series 2025A Bonds, that the Series 2025A Bonds constitute valid and binding obligations of the City and the Indenture constitutes a valid and binding obligation of the City will be subject to such limitations, and the various other legal opinions to be delivered concurrently with the issuance of the Series 2025A Bonds will be similarly qualified. A complete copy of the proposed fo rm of opinion of bond counsel is set forth in Appendix D hereto. In the event the City fails to comply with its covenants under the Indenture or to pay principal of or interest on the Series 2025A Bonds, there can be no assurance that available remedies wi ll be adequate to fully protect the interests of the Owners of the Series 2025A Bonds.

No Reserve Fund for Series 2025A Bonds
The Master Indenture provides that the city may establish a debt serve reserve fund for a given series of Bonds. No such debt serv ice reserve fund was established for the Series 2020A Bonds and no such debt service reserve fund will be established for the Series 2025A Bonds.

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35 No Acceleration of Series 2025A Bonds
In no event, upon the occurrence or continuation of an event of default under the Indenture, shall the Owners of the Series 2025A Bonds, the Trustee, or any other party have the right to accelerate the payment of principal of or interest on the outstanding Series 2025A Bonds.

Absence of Market for Series 2025A Bonds
There can be no assurance that there will ever be a secondary market for purchase or sale of the Series 2025A Bonds, and from time to time there may be no market for them, depending upon prevailing market conditions and the financial condition or market position of firms who may make the secondary market.

Potential Limitation of Tax Exemption of Interest on Series 2025A Bonds From time to time, the President of the United States, the United States Congress and/or state legislatures have proposed and could propose in the future, legislation that, if enacted, could cause interest on the Series 2025A Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent beneficial owners fr om realizing the full current benefit of the tax status of such interest. Clarifications of the Internal Revenue Code of 1986, as amended, or court decisions may also cause interest on the Series 2025A Bonds to be subject, directly or indirectly, to federa l income taxation or to be subject to or exempted from state income taxation. The introduction or enactment of any such legislative proposals or any clarification of the Internal Revenue Code of 1986, as amended, or court decisions may also affect the market price for, or marketability of, the Series 2025A Bonds. Prospective purchasers of the Series 2025A Bonds should consult their own tax advisors regarding any such pending or proposed federal or state tax legislation, regulations, or litigation, as to whi ch Bond Counsel expresses no opinion. See “TAX MATTERS – Changes in Federal and State Tax Law.”
Economic, Political, Social, and Environmental Conditions Prospective investors are encouraged to evaluate current and prospective economic, political, social, and environmental conditions as part of an informed investment decision. Changes in economic, political, social, or environmental conditions on a local, state, federal, and/or international level may adversely affect investment risk generally. Such conditi onal changes may include (but are not limited to) fluctuations in business production, consumer prices, or financial markets, unemployment rates, technological advancements, shortages or surpluses in natural resources or energy supplies, changes in law, social unrest, fluctuations in the crime rate, political conflict, acts of war or terrorism, environmental damage, and natural disasters.

Constitutional Provisions Affecting Enterprise Revenues and Expenditures California Constitution Article XIIIB Limitations. Article XIIIB of the California Constitution limits the annual appropriations of the State and of any city, county, school district, authority, or other political subdivision of the State to the level of appropriations of the particular governmental entity for the prior Fiscal Year, as adjusted for changes in the cost of living, population, and services rendered by the government entity. The “base year” for establishing this appropriations limit is the 1978 -79 Fiscal Year, and the limit is adjusted annu ally to reflect changes is population, consumer prices, and increases or decreases in the cost of services provided by these public agencies.

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36 Appropriations of an entity of local government subject to Article XIIIB include generally authorizations to expen d during a Fiscal Year the proceeds of taxes levied by or for the entity and the proceeds of State subventions, exclusive of certain State subventions, refunds of taxes, and benefit payments from retirement, unemployment insurance, and disability insurance funds. “Proceeds of taxes” include, but are not limited to, all tax revenues, most State subventions, and the proceeds to the local governmental entity from (1) regulatory licenses, user charges, and user fees (to the extent that such proceeds exceed the cost reasonably borne by such entity), and (2) the investment of tax revenues.

Article XIIIB provides that if a governmental entity’s revenues in any year exceed the amounts permitted to be spent, the excess must be returned by revising tax rates or fee sc hedules over the subsequent two years.

Certain expenditures are excluded from the appropriations limit, including payments of indebtedness existing or legally authorized as of January 1, 1979, or of bonded indebtedness thereafter approved by the voters and payments required to comply with court or federal mandates that without discretion require an expenditure for additional services or that unavoidably make the providing of existing services more costly. The City believes that its charges for sewer service and wastewater treatment do not exceed the costs it reasonably bears in providing such services and, therefore, are not subject to the limitations of Article XIIIB. The City has covenanted in the Master Indenture that it will, in each year, prescribe rates and charges sufficient to provide for payments of the Series 2025A Bonds each year.

California Constitution Article XIIIC and Article XIIID Limitations. On November 5, 1996, the voters of the State approved Proposition 218, the “Right to Vote on Taxes Ac t.” Proposition 218 added Articles XIIIC and XIIID to the State Constitution, which contain a number of provisions affecting the ability of the City to levy and collect both existing and future taxes, assessments, fees, and charges. These provisions could adversely affect the financial condition of the City, its ability to comply with its covenants under the Indenture, or the City’s ability to pay principal of or interest on the Series 2025A Bonds. In such event, there can be no assurance that remedies will be available to fully protect the interests of the Owners of the Series 2025A Bonds. See “RISK FACTORS – Limitations on Available Remedies and the City’s Ability to Generate Net Revenues” above.

Article XIIID contains several provisions affecting the abil ity of local governments to impose or increase “fees” and “charges,” defined for purposes of Article XIIID to mean “any levy other than an ad valorem tax, a special tax, or an assessment, imposed by ... [a local government] upon a parcel or upon a person as an incident of property ownership, including a user fee or charge for a property related service”; provided, however, that Article XIIID specifically provides that it shall not be construed to “affect existing laws relating to the imposition of fees or c harges as a condition of property development.” The City believes that its connection fee charges related to the Enterprise represent a fee or charge as a condition of property development within the meaning of Article XIIID, although no assurance can be given that a court would not determine otherwise. “Property related service” means a public service having a direct relationship to property ownership (which term may include tenancies). All new and existing property related fees and charges must conform to requirements prohibiting, among other things, fees and charges that (i) generate revenues exceeding the funds required to provide the property related service, (ii) are used for any purpose other than those for which the fees and charges are imposed, (iii) with respect to any parcel or person exceed the proportional cost of the service attributable to the parcel, (iv) are for a service not actually used by, or immediately available to, the owner of the property in question, or (v) are used for general gove rnmental services, including police, fire, ambulance, or library services, where the service is available to the public at large in substantially the same manner as it is to property owners. Pursuant to the Bighorn decision, discussed below, the California Supreme Court has held that charges for water service, which charges are similar to the City’s sewer service charges, are property related fees or charges within the meaning of Article XIIID. The City believes, however, that its

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37 sewer service charges, if also determined to be such property related fees or charges, would satisfy all of these requirements. However, in any legal action contesting the validity of a fee or charge, the City will have the burden of proving exemption from or compliance with Articl e XIIID and no assurance can be given that a court would not determine otherwise. Before any property related fee or charge may be imposed or increased, written notice must be given to the record owner of each parcel of land affected by such fee or charge. The City must then hold a hearing upon the proposed imposition or increase, and if written protests against the proposal are presented by a majority of the owners of the identified parcels, the City may not impose or increase the fee or charge. The City i s unable to predict whether the imposition or increase of any fee and charge, including any increase in its sewer service charge, will be prevented by such a majority protest.

Moreover, Article XIIID also provides that, beginning July 1, 1997, except for fees or charges for sewer, water, and refuse collection services (or fees for electrical and gas service, which are not treated as property related for purposes of Article XIIID), no property related fee or charge may be imposed or increased without majority approval by the property owners subject to the fee or charge or, at the option of the local agency, two thirds voter approval by the electorate residing in the affected area. The City believes that its sewer service charges are charges for sewer service within the meaning of Article XIIID, although no assurance can be given that a court would not determine otherwise.

The City does not plan to conduct any new hearings, elections, or other proceedings with respect to any of its existing sewer related fees or charges.

In addition to the provisions described above, Article XIIIC removes limitations on the initiative power in matters of local taxes, assessments, fees and charges. In the case Bighorn-Desert View Water Agency v. Beringson (“Bighorn”), decided by the California Supreme Court on July 24, 2006, the petitioner sought to establish his right to reduce a local water agency’s water rates and fees and charges through the use of the initiative power. In holding for the petitioner on this issue, the Court st ated that the absence of a restrictive definition of “fee” or “charge” in Article XIIIC suggests that those terms include all levies that are ordinarily understood to be fees or charges, including all of the property-related fees and charges subject to Art icle XIIID. (See the discussion of Article XIIID above.) Though the Court did not arrive at an exact definition of such terms, it did determine that fees and charges that are fees and charges within the meaning of Article XIIID are necessarily fees and charges within the meaning of Article XIIIC.

The Court held that Article XIIIC authorizes the use of the initiative process to reduce water rates and other delivery charges, but that it does not authorize use of the initiative power to impose a voter-approval requirement on future increases or new water delivery charges. The Court declined to determine whether the initiative power is limited by other statutory provisions requiring that water service charges be set at a level that will pay system expenses and debt service since that issue was not before the Court.

In light of the Bighorn decision, the voters of the City could, by future initiative, seek to repeal or reduce any local tax, assessment, fee, or charge, including the City’s sewer service fees and cha rges, which are the primary source of Net Revenues pledged to the payment of debt service on the Series 2025A Bonds. Though the use of the initiative power is arguably limited in the case of levies directly pledged to bonded indebtedness, such as the fees and charges imposed by the Enterprise and securing the Series 2025A Bonds, there can be no assurance that the voters of the City will not seek to approve an initiative that attempts to reduce the fees and charges imposed by the Enterprise securing the Seri es 2025A Bonds.

In addition to the foregoing, the City’s general financial condition may be affected by other provisions of Article XIIIC and Article XIIID, including (A) provisions of Article XIIIC (i) requiring taxes for general governmental purposes to be approved by a majority vote and taxes for specific purposes, even if deposited into general fund, to be approved by a two thirds vote, (ii) subjecting all taxes,

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38 assessments, fees, and charges to reduction or repeal at any time through the initiative pr ocess (as mentioned above), and (iii) provisions of Article XIIID that could reduce the ability of the City to fund certain services or programs that it may be required or choose to fund from its general fund, such as provisions (1) adding requirements making it generally more difficult to levy and maintain “assessments,” defined to mean a levy or charge upon real property for a particular and distinct benefit to the property over and above general benefits conveyed to property located in the district or to the public at large, (2) requiring any imposition or increase of property related fees or charges other than for sewer, water and refuse collection services or fees for electrical or gas service (which are not treated as property related for purposes of A rticle XIIID) to be approved by “majority of the property owners” subject to the fee or charge or, at the option of the local government, two thirds vote of the electorate residing in the affected area.

The interpretation and application of Proposition 218 will continue to be determined by the courts with respect to a number of the matters discussed above, and it is not possible at this time to predict with certainty the outcome of such future determinations.

Future Initiatives
Articles XIIIB, XIIIC, and XI IID of the Constitution were each adopted as measures that qualified for the ballot pursuant to California’s initiative process. From time to time other initiative measures could be adopted, further affecting the generation of Revenues or the City’s abilit y to expend such Revenues.

TAX MATTERS
General. In the opinion of Bond Counsel, under existing laws, regulations, rulings and judicial decisions, interest on the Series 2025A Bonds (including any original issue discount properly allocable to owners of a S eries 2025A Bond) is excluded from gross income for federal income tax purposes and is not a specific item of tax preference for purposes of the alternative minimum tax imposed on individuals.

The opinions described in the preceding sentence assume the ac curacy of certain representations and compliance by the City with covenants designed to satisfy the requirements of the Internal Revenue Code of 1986, as amended (the “Code”) that must be met subsequent to the issuance of the Series 2025A Bonds. Failure t o comply with such requirements could cause interest on the Series 2025A Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the Series 2025A Bonds. The City will covenant to comply with such require ments. Bond Counsel has expressed no opinion regarding other federal tax consequences arising with respect to the Series 2025A Bonds.

Interest on the Series 2025A Bonds may affect the federal alternative minimum tax imposed on certain corporations.

Bond Counsel is further of the opinion that interest on the Series 2025A Bonds is exempt from present State of California personal income taxes.

The accrual or receipt of interest on the Series 2025A Bonds may otherwise affect the federal income tax liability of the owners of the Series 2025A Bonds. The extent of these other tax consequences will depend upon such owner s’ particular tax status and other items of income or deduction. Bond Counsel has expressed no opinion regarding any such consequences.

Purchasers of the Series 2025A Bonds, particularly purchasers that are corporations (including S corporations, foreign corporations operating branches in the United States , and certain corporations subject to the alternative minimum tax imposed on corporations ), p roperty or casualty insurance companies, banks, thrifts or other financial institutions, certain recipients of social security or railroad

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39 retirement benefits, taxpayers otherwise entitled to claim the earned income credit, taxpayers entitled to claim the refundable credit in Section 36B of the Code for coverage under a qualified health plan or taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry tax - exempt obligations, should consult their tax advisors as to the tax c onsequences of purchasing or owning the Series 2025A Bonds.

Original Issue Discount. The Series 2025A Bonds that have an original yield above their respective interest rates, as shown on the inside cover of this Official Statement (collectively, the “Discount Bonds”), are being sold at an original issue discount. The difference between the initial public offering prices of such Discount Bonds and their stated amounts to be paid at maturity (excluding “qualified stated interest” within the meaning of Secti on 1.1273-1 of the Regulations) constitutes original issue discount treated in the same manner for federal income tax purposes as interest, as described above.

The amount of original issue discount that is treated as having accrued with respect to a Discou nt Bond is added to the cost basis of the owner of the bond in determining, for federal income tax purposes, gain or loss upon disposition of such Discount Bond (including its sale, redemption or payment at maturity). Amounts received on disposition of su ch Discount Bond that are attributable to accrued original issue discount will be treated as tax -exempt interest, rather than as taxable gain, for federal income tax purposes.

Original issue discount is treated as compounding semiannually, at a rate determined by reference to the yield to maturity of each individual Discount Bond, on days that are determined by reference to the maturity date of such Discount Bond. The amount treated as original issue discount on such Discount Bond for a particular semiannu al accrual period is equal to (a) the product of (i) the yield to maturity for such Discount Bond (determined by compounding at the close of each accrual period) and (ii) the amount that would have been the tax basis of such Discount Bond at the beginning of the particular accrual period if held by the original purchaser, less (b) the amount of any interest payable for such Discount Bond during the accrual period. The tax basis for purposes of the preceding sentence is determined by adding to the initial p ublic offering price on such Discount Bond the sum of the amounts that have been treated as original issue discount for such purposes during all prior periods. If such Discount Bond is sold between semiannual compounding dates, original issue discount tha t would have been accrued for that semiannual compounding period for federal income tax purposes is to be apportioned in equal amounts among the days in such compounding period.

Owners of Discount Bonds should consult their tax advisors with respect to the determination and treatment of original issue discount accrued as of any date and with respect to the state and local tax consequences of owning a Discount Bond. Subsequent purchasers of Discount Bonds that purchase such bonds for a price that is highe r or lower than the “adjusted issue price” of the bonds at the time of purchase should consult their tax advisors as to the effect on the accrual of original issue discount.

Original Issue Premium. The Series 2025A Bonds that have an original yield below their respective interest rates, as shown on the inside cover of this Official Statement (collectively, the “Premium Bonds”), are being sold at a premium. An amount equal to the excess of the issue price of a Premium Bond over its stated redemption price at maturity constitutes premium on such Premium Bond.

A purchaser of a Premium Bond must amortize any premium over such Premium Bond’s term using constant yield principles, based on the purchaser’s yield to maturity (or, in the case of Premium Bonds callable prior to their maturity, generally by amortizing the premium to the call date, based on the purchaser’s yield to the call date and giving effect to any call premium). As premium is amortized, the amount of the amortization offsets a corresponding amou nt of interest for the period, and the purchaser’s basis in such Premium Bond is reduced by a corresponding amount resulting in an increase in the gain (or decrease in the loss) to be recognized for federal income tax purposes upon a sale or disposition of such

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40 Premium Bond prior to its maturity. Even though the purchaser’s basis may be reduced, no federal income tax deduction is allowed. Purchasers of the Premium Bonds should consult their tax advisors with respect to the determination and treatment of premium for federal income tax purposes and with respect to the state and local tax consequences of owning a Premium Bond.

Backup Withholding . As a result of the enactment of the Tax Increase Prevention and Reconciliation Act of 2005, interest on tax -exempt obligations such as the Series 2025A Bonds is subject to information reporting in a manner similar to interest paid on taxable obligations. Backup withholding may be imposed on payments made to any bondholder who fails to provide certain required inform ation including an accurate taxpayer identification number to any person required to collect such information pursuant to Section 6049 of the Code. The reporting requirement does not in and of itself affect or alter the excludability of interest on the Se ries 2025A Bonds from gross income for federal income tax purposes or any other federal tax consequence of purchasing, holding or selling tax-exempt obligations.

Changes in Federal and State Tax Law. From time to time, there are legislative proposals in the Congress and in the various state legislatures that, if enacted, could alter or amend the federal and state tax matters referred to above or adversely affect the market value of the Series 2025A Bonds. It cannot be predicted whether or in what form any such proposal might be enacted or whether if enacted it would apply to bonds issued prior to enactment. In addition, regulatory actions are from time to time announced or proposed and litigation is threatened or commenced which, if implemented or concluded in a particular manner, could adversely affect the market value of the Series 2025A Bonds. It cannot be predicted whether any such regulatory action will be implemented, how any particular litigation or judicial action will be resolved, or whether the Series 2025A Bonds or the market value thereof would be impacted thereby. Purchasers of the Series 2025A Bonds should consult their tax advisors regarding any pending or proposed legislation, regulatory initiatives or litigation. The opinions expressed b y Bond Counsel are based upon existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the date of issuance and delivery of the Series 2025A Bonds, and Bond Counsel has expressed no opinion as of any date su bsequent thereto or with respect to any pending legislation, regulatory initiatives or litigation.

LEGAL MATTERS
Kutak Rock LLP, Irvine, C alifornia, Bond Counsel, will render an opinion with respect to the validity and enforceability of the Indenture and a s to the validity of the Series 2025A Bonds. Copies of such opinion will be available at the time of delivery of the Series 2025A Bonds. A copy of the opinion will accompany each Series 2025A Bond. Certain legal matters will be passed upon for the City by the City Attorney, and by Best Best & Krieger LLP , Los Angeles, California, as the City’s Disclosure Counsel, and for the Underwriter by Hawkins Delafield & Wood LLP , Los Angeles , California. The proposed form of the opinion of Bond Counsel is included as Appendix D hereto. See “PROFESSIONAL FEES” herein.

Bond Counsel’s employment is limited to a review of the legal proceedings required for the authorization of the Series 2025A Bonds and to rendering the opinion referred to herein. Such opinion will not co nsider or extend to this Official Statement, or any sections, documents, agreements, representations, offering circulars, or other material of any kind concerning the Series 2025A Bonds.

Bond Counsel takes no responsibility for the accuracy, completeness, or fairness of this Official Statement.

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41 LITIGATION
No litigation is pending concerning the validity of the Series 2025A Bonds or the Indenture. The City is not aware of any litigation pending or threatened questioning the political existence of the City or contesting the City’s ability to make payments on the Series 2025A Bonds. There are a number of lawsuits and claims pending against the City. In the opinion of the City Attorney, the aggregate amount of liability that the City might incur as a result of a dverse decisions in such cases would be covered under the City’s insurance policies or self-insurance program. [CONFIRM] RATING
S&P Global Ratings (“S&P”) has assigned its municipal bond rating of “ ____ (______outlook)” to the Series 2025A Bonds. There is no assurance that such rating will be in effect for any given period of time or that such rating will not be revised downward or withdrawn entirely by such rating agency if, in the judgment of such rating agency, circumstances so warrant. Any such downwar d revision or withdrawal may have an adverse effect on the market price of the Series 2025A Bonds. Such rating reflects only the views of the rating agency and an explanation of the significance of the rating may be obtained only from the rating agency furnishing the same.

UNDERWRITING
The Series 2025A Bonds are being purchased by BofA Securities, Inc. (the “Underwriter”). The Underwriter ha s agreed to purchase the Series 2025A Bonds at a purchase price of $ _____________ (comprised of the principal amount o f the Series 2025A Bonds, plus /less an original issue premium/discount of $ _____________, and less an Underwriter ’s discount of $ ____________). The Underwriter will purchase all of the Series 2025A Bonds if any are purchased.

The Underwriter has entered into a distribution agreement with its affiliate Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S”). As part of this arrangement, the Underwriter may distribute securities to MLPF&S, which may in turn distribute such securities to investors throu gh the financial advisor network of MLPF&S. As part of this arrangement, the Underwriter may compensate MLPF&S as a dealer for their selling efforts with respect to the Series 2025A Bonds.

The Underwriter and its respective affiliates are full service fin ancial institutions engaged in various activities, which may include securities trading, commercial and investment banking, advisory, investment management, investment research, principal investment, hedging, financing, brokerage and other financial and non-financial services. The Underwriter and its respective affiliates have, from time to time, performed, and may in the future perform, a variety of these services for the City, for which they received or will receive customary fees and expenses.

In the ord inary course of their various business activities, the Underwriter and its respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities, which may include credit default swaps) and financial instruments (including bank loans) for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities and instruments. Such investment and securities activities may involve securities and instruments of the City.

The Underwriter and its respective affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect of such asse ts, securities or instruments and may at any time hold, or recommend to clients that they should acquire, long and/or short positions in such assets, securities and instruments.

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42 MUNICIPAL ADVISOR
Fieldman, Rolapp & Associates , Inc. has acted as Municipal Advisor to the City in conjunction with the issuance of the Series 2025A Bonds. The Municipal Advisor has assisted the City in matters related to the planning, structuring, execution, and delivery of the Series 2025A Bonds. The Municipal Advisor will receive compensation contingent upon the sale and delivery of the Series 2025A Bonds.

The Municipal Advisor is not obligated to undertake, and has not undertaken to make, an independent verification or assume responsibility for the accuracy, completeness, or fa irness of the information contained in this Official Statement. The Municipal Advisor is an independent registered municipal advisory firm and is not engaged in the business of underwriting, trading, or distributing municipal or other public securities.

PROFESSIONAL FEES
The fees payable to certain professionals, including the Underwriter, Kutak Rock LLP , as Bond Counsel, Best Best & Krieger LLP, as Disclosure Counsel, Hawkins Delafield & Wood LLP, as counsel to the Underwriter, Fieldman, Rolapp & Associate s, Inc. , as Municipal Advisor, and the Trustee, are contingent upon the issuance of the Series 2025A Bonds.

CONTINUING DISCLOSURE
The City will covenant in a Continuing Disclosure Certificate for the benefit of Owners of the Series 2025A Bonds to provide a n annual report containing certain financial information and operating data relating to the City and to provide notices of the occurrence of certain enumerated events as specified therein. The specific nature of the information to be contained in each annu al report, or each notice of listed events, and the applicable deadlines, are set forth in the Continuing Disclosure Certificate, the form of which is attached hereto as Appendix F. These covenants will be made in order to assist the Underwriter in complying with Securities and Exchange Commission Rule 15c2-12(b)(5), as amended.

The continuing disclosure certificates related to the City’s existing bonds require the City to file annual reports that include the audited financial statements of the City for the prior Fiscal Year. If the City’s audited financial statements are not available by the time the annual report is required to be filed , the annual report is required to contain unaudited financial statements of the City in a format similar to the audited financial statements, and the audited financial statements is required to b e filed in the same manner as the annual report when they become available. The City’s audited financial statements were not available at the time the annual reports related to Fiscal Year 2023-24 were required to be filed and the City did not file the unaudited financial statements of the City. In 2021, the City initiated a project to replace its legacy Enterprise Resource Planning (ERP) system with Oracle. This transition was nec essary, as the previous system was over 20 years old and no longer met modern operational needs. Although the City successfully implemented the financial module of the Oracle system in April 2024, due to the data migration issues, the City has not been abl e to compile financial data for the Fiscal Year ending June 30, 2024 in a timely manner. The City is actively working through the year-end close process and completing the annual audit. D raft financial reports were completed for the wastewater enterprise on June 30, 2025 and a full set of draft financials for the City is expected to be completed by July 31, 2025. The audited financial statements are expected to be available by September 30, 2025.

MISCELLANEOUS
The purpose of this Official Statement is to supply information to prospective buyers of the Series 2025A Bonds. Quotations and summaries and explanations of the Series 2025A Bonds and of statutes and

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43 documents contained in this Official Statement do not purport to be complete, and reference is made to such documents and statutes for full and complete statements of their provisions.

The preparation and distribution of this Official Statement have been authorized by the City.

CITY OF BAKERSFIELD

By:

Finance Director

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A-1

APPENDIX A

SUMMARY OF CERTAIN PROVISIONS OF THE PRINCIPAL LEGAL DOCUMENTS

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B-1

APPENDIX B

CITY OF BAKERSFIELD ECONOMIC, FINANCIAL,

AND DEMOGRAPHIC INFORMATION
General
The City of Bakersfield (the “City”) is located in Kern County, California (the “County”), at the southern end of the San Joaquin Valley, approximately 110 miles north of Los Angeles and 290 miles south of San Francisco. The City includes over 1 50 square miles of land and an additional 162 square miles of land area is located within the City’s sphere of influence.

The City is a regional center for industry, government, transportation, retail trade, medical services, and oil field operations. Major manufacturing activities include iron and steel fabrication, plastic foam products, food products, petroleum refining, and textiles. Bakersfield is one of the leading convention centers in the state and is the commercial hub of the County. As the County seat, it is the location of many county, state, and federal offices.

The metropolitan area has expanded consid erably beyond the City limits. As of January 1, 2025, the estimat ed population of the County was 9 23,961 and the estimated population of the City was 419,238, according to the California Department of Finance.

City Government
The City was incorporated on J anuary 11, 1898, under the general laws of the State of California (the “State”). The City is a charter city with a council/manager form of government. The City Council is comprised of seven council members, elected by ward on a staggered basis for a term of four years. The mayor is directly elected for a four -year term. The council appoints the City Attorney and the City Manager. There are approximately 2,043 approved City employee positions, including 166 general government employees, 428 public works emp loyees, 1 99 firefighters, 33 civilians who work in fire protection, 511 police officers, 237 civilians who work with the pol ice department, 1 28 employees who work in refuse collection, and 202 employees who work with community services.

Revenues, Expenditures, and Fund Balances
The accounting records of the City are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. Funds are grouped into governmental funds, proprietary funds, and fiduciary funds. The governmental funds include (a) the General Fund of the City, (b) special revenue funds, which are used to account for the proceeds of specific revenue sources or to finance specified activities as required by law or administrative regulation, (c) debt service funds, which are used to account for the accumulation of resources for, and the payment of, general long -term debt principal, interest, and related costs, and (d) capital projects funds, which are used to account for financial resources to be used for the acquisition or construction of major capital facilities other than those financed primarily through user charges. The proprietary funds include (i) enterprise funds, which are used to account for operations that provide goods or services to the gen eral public on a continuing basis and are financed primarily through user charges, and (ii) internal service funds, which are used to account for the financing of goods or services provided by one department of the City to other departments on a cost reimbursement basis.

The fiduciary funds include trust and agency funds, which are used to account for assets held by the City in a trustee capacity or as an agent for individuals, private organizations, other governmental

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units or other funds. They include the pension trust fund and agency funds. Account groups record fixed assets used in governmental type operations and long -term liabilities expected to be financed from governmental funds.

All governmental fund types and agency funds are accounted for using the modified-accrual basis of accounting. Under the modified -accrual basis, revenues are recognized when they become measurable and expenditures are recognized when materials and services are received. Taxpayer -assessed income, gross receipts, and sales taxe s are considered “measurable” when in the hands of intermediary collecting governments and are therefore recognized as revenue at that time. Property taxes are recognized as revenue in the Fiscal Year during which they are levied, adjusted for amounts considered to be collectible more than 60 days beyond the Fiscal Year-end or ultimately uncollectible.

Those revenues susceptible to accrual are property taxes, franchise taxes, special assessments, licenses, interest revenue, and charges for services. Sales taxes collected and held by the State at year end on behalf of the government also are recognized as revenue. Fines and permits are not susceptible to accrual because generally they are not measurable until received in cash.

Expenditures are generally recog nized under the modified -accrual basis of accounting when the related fund liability is incurred. An exception is interest on general long -term debt, which is not accrued but is expensed when due. Proceeds from issuance of long -term debt are recognized as other financing sources when received and repayments are recognized as expenditures when due.

All proprietary fund types and pension trust funds are accounted for using the accrual basis of accounting. The revenues of these funds are recognized when they a re earned, and their expenses are recognized when they are incurred. Unbilled service revenues, which are not significant, are not recognized as revenues.

The City Charter requires an annual audit of the books of account, financial records, and transactions of the City by an independent certified public accountant selected by the City Council. See also “APPENDIX C – City of Bakersfield Annual Comprehensive Financial Report Fiscal Year Ended June 30, 2023.”
Budgetary Process
The Fiscal Year of the City begins on the first day of July of each year and ends on the 30th day of June of the following year (each, a “Fiscal Year”). At such date as the City Manager determines, each department head must furnish to the City Manager an estimate of revenues and expenditu res for such department for the ensuing Fiscal Year, detailed in such manner as may be prescribed by the City Manager. In preparing the proposed budget, the City Manager reviews the estimates, holds conferences thereon with the respective department heads, and revises the estimates as he deems advisable.

At least 30 days prior to the beginning of each Fiscal Year, the City Manager submits to the City Council the proposed operating budget for the Fiscal Year. The operating budget includes proposed expenditures and the means of financing them. After reviewing and making such revisions as it deems advisable, the City Council, upon recommendation by the City Manager, sets the time for the holding of a public hearing thereon, and the City Manager causes to be published a notice thereof not less than 10 days prior to the hearing date. Copies of the proposed budget are available for inspection by the public in the office of the City Clerk at least 10 days prior to the hearing.

At the conclusion of the public hearing , the City Council further considers the proposed budget and makes any revision thereof that it deems advisable. On or before June 30, the City Council adopts the

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budget with revisions, if any, through the passage of a resolution. Budgets are adopted for a ll governmental fund types and are prepared on a basis consistent with generally accepted accounting principles.

From the effective date of the budget, the several amounts stated as proposed expenditures become appropriated to the several departments, offices and agencies for the objects and purposes named, provided that the City Manager may transfer budgeted amounts between departments within any fund and approve reductions of budgeted amounts. All appropriations lapse at the end of the Fiscal Year to the extent that they have not been expended or lawfully encumbered. Encumbered amounts are reappropriated in the following Fiscal Year budget.

At any City Council meeting after the adoption of the budget, the City Council may amend or supplement the budget by the affirmative vote of the City Council.

The City Council employs, at the beginning of each Fiscal Year, an independent certified public accountant who, at such time or times as specified by the City Council, at least annually, and at such other times as he shall determine, examines the books, records, inventories and reports of all officers and employees who receive, control, handle, or disburse public funds and of all such other officers, employees, or departments as the City Council may direct. As soon as practicable after the end of the Fiscal Year, a final audit and report is submitted by such accountant to the City Council and certain City officers and made available for public inspection, and a copy of the financial statements as of the close of the Fiscal Year is published.

Budgetary Controls
The City employs budgetary controls to ensure compliance with legal provisions applicable to the annual appropriated budget approved by the City Council. Project length financial plans are adopted for the capital projects funds. The level of budgetary control is established at the fund level. The City also maintains an encumbrance accounting system as one technique of accomplishing budgetary control.

Unencumbered amounts lapse at year -end. However, encumbrances a nd certain capital projects are re - appropriated as part of the following year’s budget.

The City’s Fiscal Year 20 24-25 appropriations limit established as required by State statute is $575,210,026. For a discussion of the City’s budgetary controls, see “APPENDIX C – City of Bakersfield Annual Comprehensive Financial Report Fiscal Year Ended June 30, 2023.” Investment Policy of the City
The City Council annually adopts and approves a policy with respect to the investment activities of the City and its relat ed entities. Idle cash in all funds is pooled for investment purposes except tax - exempt bond proceeds, which are separated for arbitrage record keeping as required by federal tax law.

The investment policy is intended to provide guidelines for the prudent investment of the City’s temporary idle cash, and outline the policies for maximizing the efficiency of the City’s cash management system. The ultimate goal is to enhance the economic status of the City while protecting the safety of its financial assets. The City’s present investment policy (the “Investment Policy”), was adopted by the City Council on July 17, 2019.

The Investment Policy is intended to provide guidelines for the prudent investment of the City’s temporary idle cash, and outline the policies for maximizing the efficiency of the City’s cash management system. It is the policy of the City to invest public funds in a manner which will provide safety of

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principal and at least a market rate of return while meeting the daily cash flow demands of th e City.

Investments will conform to all statutes governing the investment of public funds.

The primary goals of the Investment Policy are:
 To assure compliance with all federal, State and local laws governing the investment of public funds under the control of the City Treasurer.
 To maintain the principal value of financial assets and ensure ample liquidity to meet operating expenditures.
 Within the constraints of safety and liquidity, and within the parameters of the Investment Policy, generate a market rate of return.

The ultimate goal is to enhance the economic status of the City while protecting the safety of its financial assets.

The Investment Policy applies to the investment activities of the City and related entities. Idle cash in all funds is pooled for investment purposes except tax exempt bond proceeds, which are separated for arbitrage record keeping as required by federal tax law, and the Firemen’s Disability and Retirement Fund, which is administered separately under the City of Bakersfield Municipal Code Section 2.92. Other Post-Employment Benefits (OPEB) are administered by a separate investment policy per Resolution 008 -

07. Investments made on a pooled basis include moneys of the City, the Successor Agency and the Public Financing Authority . T he pooled funds are accounted for in the City’s Annual Comprehensive Financial Report (“ACFR”) and include:
0XX General Funds
1XX Special Revenue Funds
2XX Debt Service Funds
3XX Capital Project Funds
4XX Enterprise Funds
5XX Internal Service Funds
6XX Fiduciary-Agency Funds
Any new fund created, unless specifically exempted.

All debt issue proceeds will be invested in accordance with the associated trust indenture, and in such a manner that facilitates arbitrage rebate calculations.

Pension Plans
The City ’s Retirement Plans. The City participates in the Miscellaneous Plan of the City of Bakersfield (the “Miscellaneous Plan”), the Safety Fire Plan of the City of Bakersfield (the “Safety Fire Plan”), and the Safety Police Plan of the City of Bakersfield (the “Safety Police Plan”), which are included in the Public Agency portion of the California Public Employees Retirement System (“CalPERS”). Combined, the Miscellan eous Plan, the Safety Fire Plan and the Safety Police Plan cover all permanent and certain part-time employees of the City.

The Miscellaneous Plan, the Safety Fire Plan, and the Safety Police Plan (the “CalPERS Plans”) provide retirement and disability benefits, annual cost -of-living adjustments, and death benefits to plan

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members and beneficiaries. Each of the CalPERS Plans is part of the Public Agency portion of CalPERS, an agent multiple -employer plan administered by CalPERS, which acts as a common investment and administrative agent for participating public employers within the State. A menu of b enefit provisions, as well as other requirements, is established by State statutes within the Public Employee’s Retirement Law.

The City selects optional benefit provisions for each of the CalPERS Plans from the benefit menu by contract with CalPERS and ad opts those benefits through local ordinance. CalPERS issues a separate annual comprehensive financial report. Copies of the CalPERS annual financial report may be obtained from their Executive Office at 400 P Street, Sacramento, California 95814.

The Miscellaneous Plan. Most active plan members in the Miscellaneous Plan are required to contribute 8% of their annual covered salary. The City is required to contribute the actuarially determined remaining amounts necessary to fund the benefits for its members. The actuarial methods and assumptions used are those adopted by the CalPERS Board of Administration. The required employer contribution rate for Fiscal Year 2023-24 is 30.201%. The contribution requirements of the plan members are established by State statute and the employer contribution rate is established and may be amended by CalPERS.

For the year ended June 30, 20 24, the City’s annual pension cost of $ 27,451,888 for CalPERS was equal to the City’s required and actual contributions.

The Safety Fire Plan . Most active Safety Fire Plan members are required to contribute 9% of their annual covered salary towards payment of the annual pension cost. The City is required to contribute the actuarially determined remaining amounts necessary to fund the benefits f or its members. The actuarial methods and assumptions used are those adopted by the CalPERS Board of Administration. The required employer contribution rate for Fiscal Year 2023-24 is 50.445%. The contribution requirements of the plan members are established by State statute and the employer contribution rate is established and may be amended by CalPERS.

For the year ended June 30, 20 24, the City’s annual pension cost of $12,495,880 for CalPERS was equal to the City’s required and actual contributions.

The Safety Police Plan. Most a ctive plan members in the Safety Police Plan are required to contribute 9% of their annual covered salary. The City is required to contribute the actuarially determined remaining amounts necessary to fund the benefits for its members, the actuarial methods and assumptions used are those adopted by the CalPERS Board of administration. The required employer contribution rate for Fiscal Year 2023-24 is 54.640%. The contribution requirements of the plan members are established and may be amended by CalPERS.

For the year ended June 30, 20 24, the City’s annual pension cost of $ 29,575,662 for CalPERS was equal to the City’s required and actual contributions.

The required contribution for Fiscal Year ended June 30, 2024 for the three plans described above was determined as part of the June 30, 20 21 actuarial valuation using the entry age normal actuarial cost method with the contributions determined as a percent of pay. The actuarial assumptions included (a)

6.80% discount rate compounded an nually (net of administrative expenses), (b) projected annual salary increases that vary by duration of service, entry age and category, and (c) an overall payroll growth of

2.80% compounded annually. Both (a) and (b) include an inflation component of 2. 80%. The actuarial valuation of the three plan is based on a policy that amortizes all gains and losses over a fixed 30 -year period, the increase or decrease in the rate is then spread directly over a 5 -year period. The unfunded actuarial accrued liability is being amortized as a level percentage of projected payrolls on a closed basis.

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Unfunded Liability and Contribution Rates. The unfunded actuarial accrued liability for valuation date June 30, 20 23 (the most recent information available from CalPERS), w as $222,938,636 for the Miscellaneous Plan (funded ratio of 69.2%), $116,033,212 for the Safety Fire Plan (funded ratio of

68.4%), and $ 275,421,834 for the Safety Police Plan (funded ratio of 60.3%). The total unfunded liabilities for the City (all three plans combined) have been estimated by CalPERS to be $ 614,393,682 as of June 30, 20 23. As part of its June 30, 20 23, actuarial report, CalPERS provided the City with the following Estimated Total Employer Contribution Rates (as a % of projected payroll) for the future 2025- 26 Fiscal Year budget, 33.77% for Miscellaneous Plan employees, 61.82% for Safety Fire Plan employees and 65.75% for Safety Police Plan employees.

In July 2021, the CalPERS Board of Administration approved an incremental lowering of the discount rate from 7.0% to 6.8% as part of the Funding Risk Mitigation Policy established by the agency in 2015 to help balance pension plan risks. This policy lowers the discount rate in years of good investment returns to reduce risk in the portfolio. Th e policy automatically lowered discount rate when CalPERS achieved an investment return of 21.3% for Fiscal Year 2020-21. While the full impact of the discount rate changes on the City is not yet clear, CalPERS pension plans will see a decrease in median total employer contribution rates, which includes both normal and unfunded actuarial liability costs, from less than 1% in miscellaneous plans to a decrease of more than 2% in some safety plans. The new actuarial assumptions cost increases are fairly modest.

Other Post-Employment Benefits
The City provides other post-employment benefits (“OPEB”) to former employees in the form of a medical premium subsidy. The level of such medical premium subsidy for each former employee is dependent upon such former employ ee’s date of hire and years of service with the City. The City’s medical premium subsidy program is more fully described in “Note 17 – Other Post -Employment Benefits” in the Notes to the Financial Statements section of the City’s ACFR for Fiscal Year 2022-23, a copy of which is attached to this Official Statement as Appendix C.

In December 2006, the City contracted with Phase II Systems, doing business as Public Agency Retirement Services, for trust administration services and established an irrevocable tru st for its post - retirement medical benefit plan. In accordance with Governmental Accounting Standards Board (GASB) Statements No. 74 and No. 75, the City has an actuarial study performed every two years. The most recent actuarial study was performed by The Segal Company with a valuation date of July 1, 2023.

Insurance
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City est ablished a Self - Insurance Fund (an internal service fund) to account for and finance its uninsured risks of loss. Under this program, the Self-Insurance Fund provides coverage for up to $500,000 for each worker’s compensation claim and $1,000,000 for each liability claim. The City participates in a joint powers authority for worker’s compensation claims in excess of coverage provided by the Self -Insurance Fund up to statutory limits and participates in a joint powers authority for any excess liability claim s. All funds of the City participate in the program and are charged for their share of claim expenditures.

The claims liability of $ 78,229,000 at June 30, 20 23, is based on the requirements of Governmental Accounting Standards Board No. 10 (GASB 10), which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be

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reasonably estimated. An estimate of incurred but not reported claims has been included in the liability based on the various percentages of loss reserves.

Additionally, the City has obtained excess liability coverage through the Authority for California Cities Excess Liability ( “ACCEL”), a joint powers authority of medium -size California municipalities.

ACCEL pools catastrophic general liability, automobile liability and public officials’ errors and omissions losses, or purchases excess insurance, depending on market conditions. As of June 30, 2023, the City had $2,468,523 on deposit with ACCEL out of approximately $27,096,546.

Tax Levies and Delinquencies; Assessed Valuation of Taxable Property The County Tax Collector collects ad valorem property tax levi es representing taxes levied for each Fiscal Year on taxable real and personal property that is situated in the County as of the preceding March 1. Unsecured taxes are assessed and payable on March 1 and become delinquent August 31, in the next Fiscal Year . Accordingly, unsecured taxes are levied at the rate applicable to the Fiscal Year preceding the one in which they are paid.

One half of the secured tax levy is due November 1 and becomes delinquent December 10; the second installment is due February 1 an d becomes delinquent April 10. A 10% penalty is added to any late installment.

Property owners may redeem property upon payment of delinquent taxes and penalties. Tax - delinquent properties are subject to a redemption penalty of 1.5% of the delinquent amoun t every month commencing on July 1 following the date on which the property became tax delinquent. Properties may be redeemed under an installment plan by paying current taxes, plus 20% of delinquent taxes each year for five years, with interest accruing a t 1.5% per month on the unpaid balance. If no payments have been made on delinquent taxes at the end of five Fiscal Years, the property is deeded to the State. Such property may thereafter be conveyed to the County Tax Collector as provided by law.

The table below summarizes the City’s property tax levies and total collections for Fiscal Years 2019-20 through 2023-24.

City of Bakersfield
Property Tax Levies and Collections(1)
(Fiscal Years 2019-20 through 2023-24)

Fiscal
Year
Total
Tax Levy
Total Tax
Collections
Percent of Levy
Collected
2019-20 $47,854,714 $49,634,163 103.7%
2020-21 55,963,993 55,106,304 98.5
2021-22 57,429,550 56,309,428 98.0
2022-23 61,652,588 60,603,853 98.3
2023-24 66,469,834 64,362,574 96.8
_____________________________
(1) Excludes redevelopment tax increment.

Source: City of Bakersfield Annual Comprehensive Financial Report Fiscal Year Ended June 30, 20 23 and Kern County Auditor Controller.

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The table below summarizes the assessed value of taxable property in the City for Fiscal Years 2019-20 through 2023-24.

City of Bakersfield
Assessed Value of Taxable Property
(Fiscal Years 2019-20 through 2023-24)
(000s)
Fiscal
Year

Residential -
Secured

Commercial -
Secured

Other -
Secured

Unsecured

Less Tax-
Exempt Real
Property
Total
Taxable
Assessed
Value
2019-20 $22,729,432 $4,968,389 $4,339,072 $794,111 $1,577,783 $31,253,221 2020-21 23,987,795 5,145,836 4,432,049 805,480 1,645,117 32,726,043 2021-22 25,334,257 5,244,832 4,468,139 818,232 1,658,484 34,206,976 2022-23 27,378,429 5,538,516 4,742,249 867,539 1,608,355 36,918,378 2023-24 29,556,320 5,831,091 5,318,002 932,395 1,760,595 39,877,213 _____________________________
Source: City of Bakersfield Annual Comprehensive Financial Report Fiscal Year Ended June 30, 2023 and HdL Coren & Cone.

The table below shows the assessed valuations of the principal taxpayers in the City as of June 30, 2024.

City of Bakersfield
Assessed Valuation of Principal Taxpayers
(June 30, 2024)
Taxpayer (1)
2023-24 Assessed
Valuation
Percentage of Total
Assessed Valuation
Nestle Dreyers Ice Cream Company (formerly Nestle
Holdings, Inc. in 2009)
$ 235,787,343 0.61%
Chevron 186,227,341 0.48
California Water Service Company 145,592,934 0.37
Valley Plaza Mall LP (formerly Bakersfield Mall LLC) 148,435,218 0.38 Walmart Stores Inc/Sam’s Club 108,688,376 0.28
Castle & Cook CA Inc. 123,518,004 0.32
DS Properties 18 (formerly Donahue Schriber Realty 94,931,567 0.24 Bolthouse Land Company LLC 78,873,518 0.20
GSF Springs I Investors LP 67,400,558 0.17
Sillect Heart LLC 63,412,000 0.16

Total taxable assessed value of 10 largest taxpayers 1,252,866,859 3.22 Total taxable assessed value of other taxpayers 37,641,951,563 96.78 Total taxable assessed value of all taxpayers $38,894,818,422 100.00%

_____________________________
(1) Related or affiliated parties are grouped together.

Source: City of Bakersfield Annual Comprehensive Financial Report Fiscal Year ended June 30, 2023 and HdL Coren & Cone.

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Demographic Statistics
The following table sets forth various demographic data regarding the City, including population, per capita personal income, and estimated unemployment rate, from Fiscal Year 20 19-20 through 2023-

24. City of Bakersfield
Demographic Statistics
(Fiscal Years 2019-20 through 2023-24)

Fiscal Year

Population

Per Capita
Personal Income
Estimated
Unemployment
Rate
2019-20 392,756 $25,180 5.3%
2020-21 397,392 25,734 11.2
2021-22 408,865 25,372 8.0
2022-23 408,373 28,157 4.8
2023-24 411,109 31,365 6.0
_____________________________
Source: City of Bakersfield Annual Comprehensive Financial Report Fiscal Year ended June 30, 2023 and HdL Coren & Cone.

Employment
The following table sets forth information regarding the size of the labor force, employment rates, and unemployment rates for the City, the County, and the State for calendar years 2020 through 2024.

Employment Averages
City of Bakersfield, Kern County, and State of California (Calendar Years 2020 – 2024)

2020 2021 2022 2023 2024
City of Bakersfield
Labor Force 183,300 182,900 185,500 190,100 193,200
Employment 162,900 168,500 176,400 179,100 181,100
Unemployment Rate 11.1% 7.8% 4.9% 5.8% 6.3%
Kern County
Labor Force 388,600 388,100 393,000 401,400 408,100
Employment 339,100 349,500 365,300 368,700 372,800
Unemployment Rate 12.7% 9.9% 7.1% 8.2% 8.6%
State of California
Labor Force (000s) 18,956.6 18,954.6 19,218.3 19,471.0 19,644.1 Employment (000s) 17,039.8 17,564.9 18,393.9 18,551.8 18,600.9 Unemployment Rate 10.1% 7.3% 4.3% 4.7% 5.3%
___________________
Source: California Employment Development Department.

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The following table sets forth the top 10 employers in the City as of June 30, 2023.

City of Bakersfield
Principal Employers
(As of June 30, 2023)

Firm Employees
County of Kern 7,923
Kern High School District 4,921
Bakersfield City School District 4,137
Dignity Heath 3,431
Panama-Buena Vista Union School District 3,040
WB Bolthouse Farms 2,601
Kern Medical Center 2,400
Adventist Health Bakersfield -
City of Bakersfield 1,994
Kern County Superintendent of Schools 1,553
Others 138,700
Total 170,700
______________________
Source: City of Bakersfield Annual Comprehensive Financial Report Fiscal Year ended June 30, 2023.

Building Activity
The following table summarizes the City’s total annual building permit valuations for calendar years 2019 through 2023.

City of Bakersfield
Property Value, Construction, and Bank Deposits(1)
(Calendar Years 2019 through 2023)

Commercial
Construction
Residential
Construction
Other
Construction
Total
Construction
Calendar
Year (3)
Number
of Units

Value
Number
of Units

Value

Value
Number
of Units

Value
Bank
Deposits (2)
2019 111 $48,155 1,421 $400,718 $321,560 1,532 $770,433 $8,675,464 2020 64 47,473 1,632 526,899 348,540 1,696 922,912 9,960,173 2021 43 34,698 1,130 349,562 418,846 1,173 803,106 10,379,883 2022 70 42,426 1,164 356,363 420,354 1,234 819,143 10,298,664 2023 111 52,481 1,247 379,397 406,830 1,532 838,709 7,277,581 __________________________
(1) Property values and bank deposits reported in thousands. (2) Federal Deposit Insurance Corporation.
(3) Construction units and values are based on a 12-month calendar year.

Source: City of Bakersfield Annual Comprehensive Financial Report Fiscal Year Ended June 30, 20 23; City of Bakersfield Development Services Department and FDIC.GOV/BANK.

Commercial Activity
Consumer spending in calendar year 20 24 resulted in approximately $ 7,814,768,000 in taxable sales in the City, which is approximately 3.14% less than in calendar year 2023. The following tables set forth information regarding taxable sales in the City for calendar year 2020 through 2024.

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City of Bakersfield
Taxable Retail Sales
Calendar Years 2020 through 2024
(000s)

2020 2021 2022 2023 2024
Motor Vehicles and Parts Dealers $1,409,807 $1,754,275 $1,708,673 $1,690,226 $1,581,189 Home Furnishings and Appliance Stores 227,159 294,459 262,592 247,528 231,661 Bldg. Materials and Garden Equip. and Supplies 449,541 534,628 523,818 528,640 518,365 Food and Beverage Stores 286,694 301,072 318,648 321,717 319,140 Gasoline Stations 426,900 609,934 748,163 660,134 624,885 Clothing and Clothing Accessories Stores 289,133 464,361 436,348 426,222 421,759 General Merchandise Stores 949,604 1,125,977 1,182,184 1,134,461 1,133,207 Food Service and Drinking Places 740,065 1,009,899 1,090,734 1,152,056 1,166,504 Other Retail Group 449,278 479,079 481,126 463,372 443,262 Total Retail and Food Services $5,228,181 $6,573,684 $6,752,286 $6,624,356 $6,439,972 All Other Outlets 1,077,982 1,259,881 1,475,117 1,443,934 1,374,796 Total All Outlets $6,306,163 $7,833,566 $8,227,403 $8,068,290 $7,814,768 ________________________
Source: California State Board of Equalization and California Department of Tax and Fee Administration.

There are three major shopping centers in the City. Major department stores with local outlets include Macy’s, J.C. Penney, and Ko hl’s. The retail base includes four Wal-Marts Supercenters, four Targets, four Home Depots, three Lowe’s Home Improvement Stores, two Costcos, and a Sam’s Club.

The number of sales permits issued and the valuation of taxable transactions for the years 20 20 through 2024 is presented in the following table.

City of Bakersfield
Number of Permits and Valuation of Taxable Transactions Calendar Years 2020 through 2024
(000s)

Retail Stores Total All Outlets
Year No. of Permits Taxable Transactions No. of Permits Taxable Transactions 2020 7,666 $5,278,183 11,582 $6,356,165
2021 7,419 6,573,686 11,300 7,833,568
2022 7,662 6,752,287 11,815 8,227,405
2023 7,282 6,624,357 11,348 8,068,291
2024 7,172 6,437,621 11,290 7,818,630
____________________
Source: California State Board of Equalization and California Department of Tax and Fee Administration.

Transportation
Well-developed surface and air transportation facilities are available to City residents and business firms. Main lines of both the Union Pacific and the Burlington Northern Santa Fe ra ilroads traverse the area. Amtrak service is available.

State Highway 99, the main north -south artery serving the most populous communities along the east side of the Central Valley, runs through the center of the City. State Highway 58 provides east -west linkage between Interstate 5, 20 miles west, and Interstate 15 at Barstow, to the east, Highway 178, heading northeast, is the major route along the Kern River Valley. Highway 65, to the north, provides access to communities east of Highway 99 and to Sequoia National Park.

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Interurban motor transportation is made available by Orange Belt Stages, Greyhound, and Trailways. Golden Empire Transit provides local bus transportation.

The Meadows Field Airport adjoins the City to the north. Regularly scheduled passe nger and air cargo service is available, as well as charter service and general aviation services. The Meadows Field Airport includes the William M. Thomas Terminal, a 64,800 square foot, state -of-the-art terminal facility completed in November 2005 that i s currently equipped with three jet -boarding bridges, but that may be expanded to accommodate up to nine gates.

The Director of Airports is appointed by the County Board of Supervisors. The County Board of Supervisors meets at 1115 Truxtun Avenue in Bakers field, California, on Monday and Tuesday of each week. Department of Airports agenda items are usually heard on Tuesday at 9:00 a.m.

Utilities
Electricity throughout the City is supplied by Pacific Gas and Electric Company. This company, along with Southern California Gas Company, also supplies natural gas. Telephone service is by AT&T.

Fifteen private water companies serve the City. The City provides sewer and water services.

Education
Public education in the City through the secondary grades is provided by a number of elementary school districts, including the Bakersfield City School District and Kern High School District. There are also a number of private schools, nursery schools, and pre-schools within the City.

The City lies within Kern Community Col lege District, which administers Bakersfield College.

This two-year institution is located on a 150 -acre site in northeast Bakersfield. Vocational and technical courses are offered as well as academic courses designed to equip the student for transfer to a four-year college or university in the third year. Bakersfield College attracts about half the local high school graduating class each year.

California State University, Bakersfield, opened in 1970 and received its university status in 1988. It is located on a 375 -acre site located in the western portion of the City. Majors offered include anthropology, art, earth sciences, philosophy, mathematics, political science, business, and teaching. A graduate program offers a master’s degree in a number of fields.

The newest campus in the University of California system, UC Merced, opened in 2005. UC Merced serves the entire San Joaquin Valley, with the main campus located in the City of Merced and satellite centers located in the City and the Cities of Fresno and Modesto.

Financial Services
Statewide banking systems serving the City include Bank of America, Chase Bank, U.S. Bank, and Wells Fargo Bank. Their services are supplemented by local and regional banks and various savings and loan associations.

Community Facilities
The City has six general hospitals with a total bed capacity of approximately 1,234. The City is a primary medical center of a region larger than some states. Mercy Hospital and Bakersfield Memorial

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Hospital are among the largest employers in th e City. Kern Medical is affiliated with UCLA Medical Center of Los Angeles.

The daily “Bakersfield Californian” and two weekly newspapers provide regional news coverage.

Bakersfield has 20 radio stations, four television stations, two cable TV companies, a nd two satellite TV companies.

The City has 65 public parks, covering a total of 798 acres.

The Dignity Health Arena, Theater, and Convention Center contains a 3,250 -seat concert hall, an 11,000-seat arena, and 14 meeting rooms. Memorial Stadium hosts more National AAU track meets than any other city in the country. County -owned golf courses and five private courses offer year -round golf, and tennis is played throughout the year at six private tennis clubs.

Cultural advantages of the City include community theater, the Bakersfield Symphony orchestra, a community concert group, and the Cunningham Art Gallery. Bakersfield College and California State University, Bakersfield, sponsor plays, concerts, lectures, and special events throughout the year.

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APPENDIX C

CITY OF BAKERSFIELD ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 2023

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APPENDIX D

FORM OF BOND COUNSEL OPINION

[Date of Delivery]

City of Bakersfield
1600 Truxtun Avenue
Bakersfield, CA 93301
$__________
City of Bakersfield, California
Wastewater Revenue Refunding Bonds
Series 2025A
Ladies and Gentlemen:

We have acted as Bond Counsel to the City of Bakersfield, California (the “City”) in connection with the issuance and sale by the City of $ ___________ aggregate principal am ount of its Wastewater Revenue Refunding Bonds, Series 2025A (the “Series 2025A Bonds”). Proceeds of the Series 2025A Bonds, together with certain available moneys of the City, are being used to (i) defease the City’s outstanding City of Bakersfield, Cali fornia Wastewater Revenue Refunding Bonds, Series 2015A (the “Refunded Bonds”); and (ii) pay costs of issuance of the Series 2025A Bonds.

The Series 2025A Bonds are being issued pursuant to Section 33.3 of the Charter of the City (the “Charter”), Chapter 3 .55 of the City’s Municipal Code (the “Municipal Code”), which incorporates certain provisions of the Revenue Bond Law of 1941, Section 54300, et seq ., of the California Government Code (the “Revenue Bond Law”), certain provisions of the laws of the State of California (the “State”) (including Section 53580 et seq. of the California Government Code) (the “Ref unding Law”), Resolution No. 007-2020 adopted by the City Council on January 22, 2020 (the “Resolution”), the Master Trust Indenture, dated as of August 1, 2007 (the “Master Indenture”), by and between the City and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), and a Sixth Supplemental Trust Indenture, dated as of ________ 1, 2025 (the “Sixth Supplemental Indenture” and together with the Master Indenture, the “Indenture”), by and between the City and the Trustee.

The Series 2025A Bonds are special, limited obligations of the City payable solely from and secured by the Net Revenues (as defined in the Master Indenture) derived by the City from the operations of the Enterprise (as defined in the Master Indenture) and certain funds and accounts held under the Indenture. None of the properties of the Enterprise are subject to any mortgage or other lien for the benefit of the owners of the Series 2025A Bonds, and neither the full faith and credit nor the taxing power of the City, Kern County, the State of California (the “State”), or any other political subdivision or agency of the State is pledged to the payment of the principal of, premium, if any, or interest on the Series 2025A Bonds.

In connection with the issuance of the Series 2025A Bonds, we have examined the following:
(a) a copy of the Charter, the Municipal Code, the Revenue Bond Law and the Refunding Law;
(b) a certified copy of the Resolution;

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(c) an executed counterpart of the Master Indenture;
(d) an executed counterpart of the Sixth Supplemental Indenture; (e) certifications of the City and others;
(f) an executed counterpart of a Tax Compliance Certificate dated this da te relating to the Series 2025A Bonds (the “Tax Certificate”);
(g) an opinion of the City Attorney with respect to the City; (h) an executed counterpart of the Escrow Agreement, dated _______, 2025, by and between the City and U.S. Bank Trust Company, National Association, as Trustee and escrow agent, with respect to the Refunded Bonds;
(i) an executed counterpart of the Verification Report, dated _______, 202 5, by Causey Demgen & Moore P.C.; and
(j) such other documents as we deemed relevant and necessary in rendering this opinion.

From such examination, we are of the opinion that:

1. The City is duly organized and existing as a Charter City under and by virtue of the Constitution and the laws of the State, with the power to enter into and perform its obli gations under the Master Indenture and the Sixth Supplemental Indenture and to issue the Series 2025A Bonds.

2. The Master Indenture and the Sixth Supplemental Indenture have been duly authorized, executed and delivered by the City and, assuming due author ization, execution and delivery by the Trustee, represent valid and binding agreements of the City enforceable in accordance with their terms.

3. The Series 2025A Bonds have been validly authorized, executed and issued in accordance with the Charter, the M unicipal Code, the Refunding Law, the Resolution, the Master Indenture and the Sixth Supplemental Indenture. The Series 2025A Bonds represent valid and binding limited obligations of the City payable solely from and secured by an assignment and pledge by the City to the Trustee of the Net Revenues and certain funds and accounts created under the Master Indenture and the Sixth Supplemental Indenture, and not out of any other fund or money of the City or the State.

4. Under existing laws, regulations, ruling s and judicial decisions, interest on the Series 2025A Bonds is excluded from gross income for federal income tax purposes. Interest on the Series 2025A Bonds is not a specific item of tax preference for purposes of the federal alternative minimum tax imposed on individuals. Interest on the Series 2025A Bonds may affect the federal alternative minimum tax imposed on certain corporations.

5. Under existing laws, interest on the Series 2025A Bonds is exempt from present State of California personal income taxes.

The opinions set forth in paragraph 4 regarding the exclusion of interest on the Series 2025A Bonds from the gross income of the recipients thereof for federal income tax purposes is subject to the accuracy of certain representations and the continui ng compliance by the City with covenants regarding federal tax law contained in the Master Indenture, the Fifth Supplemental Indenture and the Tax Certificate. Failure to comply with such covenants could cause interest on the Series 2025A Bonds to be

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included in gross income retroactive to the date of issuance of the Series 2025A Bonds. Although we are of the opinion that interest on the Series 2025A Bonds is excluded from gross income for federal tax purposes, the accrual or receipt of interest on the Se ries 2025A Bonds may otherwise affect the federal income tax liability of the recipient. The extent of these other tax consequences will depend upon the recipient’s particular tax status or other items of income or deduction. We express no opinion regard ing any such consequences.

The obligations of the City and the security provided therefor, as contained in the Series 2025A Bonds, the Master Indenture and the Sixth Supplemental Indenture may be subject to general principles of equity which permit the exe rcise of judicial discretion and are subject to the provisions of applicable bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or affecting the enforcement of creditors’ rights generally, now or hereafter in effect. As Bond Co unsel to the City, we have not undertaken any responsibility for the accuracy, completeness or fairness of the Official Statement, dated ____________, 2025, or any other offering material relating to the Series 2025A Bonds and express no opinion relating t hereto. Our engagement with respect to the Series 2025A Bonds has concluded with their issuance, and we disclaim any obligation to update this letter.

Very truly yours,

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APPENDIX E

BOOK-ENTRY ONLY SYSTEM
The following description of DTC and its book -entry system has been provided by DTC and has not been verified for accuracy or completeness by the City, and City does not take any responsibility or have any liability with respect thereto. The City shall have no responsibility or liability for any aspect s of the records maintained by DTC relating to, or payments made on account of, beneficial ownership, or for maintaining, supervising, or reviewing any records maintained by DTC relating to beneficial ownership, of interests in the Series 2025A Bonds.

The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the Series 2025A Bonds. The Series 2025A Bonds will be issued as fully -registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such othe r name as may be requested by an authorized representative of DTC. One fully -registered Series 2025A Bond certificate will be issued for each maturity of the Series 2025A Bonds, each in the aggregate principal amount of such maturity, and will be deposited with DTC.

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 “clea ring 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 Direc t 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 als o 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 (“Indire ct Participants”). DTC has a S&P Global Ratings 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. The foregoing internet address is included for reference only and the information on the internet site is not a part of this Official Statement or incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information included in such internet site.

Purchases of the Series 2025A Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Series 2025A Bonds on DTC’s records. The ownership interest of each actual purchaser of each Series 2025A Bond (“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 ownersh ip interests in the Series 2025A Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners

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will not receive certificates representing their ownership interests in the Series 2025A Bonds, except in the event that use of the book-entry system for the Series 2025A Bonds is discontinued.

To facilitate subsequent transfers, all Series 2025A Bonds 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 Series 2025A Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any chang e in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Series 2025A Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Series 2025A Bonds are credited, which may or may not be th e Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to In direct 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 the Series 2025A Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Series 2025A Bonds, such as redemptions, tenders, defaults, and proposed amendments to the Series 2025A Bond documents. For example, Beneficial Owners of Series 2025A Bonds may wish to ascertain that the nominee holding the Series 2025A Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish t o provide their names and addresses to the registrar and request that copies of notices be provided directly to them.

Redemption notices shall be sent to DTC. If less than all of the Series 2025A Bonds are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such Series 2025A Bonds to be redeemed.

Neither DTC nor Cede & Co. (nor such other DTC nominee) will consent or vote with respect to the Series 2025A Bonds unless authorized by a Direct Participa nt in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts the Series 2025A Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Redemption proceeds, principal payments, and interest payments with respect to the Series 2025A Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts, upon DTC’s receipt of funds and corresponding detail information from the City or the Trustee, on payable date in acc ordance 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 Trustee, or the City, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, princip al, and interest to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the City or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as securities depository with respect to the Series 2025A Bonds at any time by giving reasonab le notice to the City or the Trustee. Under such

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circumstances, in the event that a successor securities depository is not obtained, Series 2025A Bond certificates are required to be printed and delivered.

The City may decide to discontinue use of the syst em of book-entry-only transfers through DTC (or a successor securities depository). In that event, Series 2025A Bond certificates will be printed and delivered to DTC.

The information contained in this Appendix E 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.

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APPENDIX F

FORM OF CONTINUING DISCLOSURE CERTIFICATE