PRELIMINARY OFFICIAL STATEMENT DATED NOVEMBER 27, 2012

THIS PRELIMINARY OFFICIAL STATEMENT AND THE INFORMATION CONTAINED HEREIN ARE SUBJECT TO COMPLETION OR AMENDMENT IN A FINAL OFFICIAL STATEMENT. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

NEW ISSUES - Book-Entry Only

RATINGS:

Moodys: Aa1 Standard & Poors: AA+ (See RATINGS herein)

In the opinion of Peck, Shaffer & Williams LLP, Bond Counsel with respect to the Series 2012 Bonds, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming continuing compliance with certain covenants made by the City, (i) interest on the Series 2012 Bonds will be excludible from gross income of the holders thereof for purposes of federal income taxation, (ii) interest on the Series 2012 Bonds will not be a specific item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, and (iii) interest on and any profit made on the sale, exchange, or other disposition of, the Series 2012 Bonds, are exempt from the Ohio personal income tax, the net income base of the Ohio corporate franchise tax, the Ohio commercial activity tax, and municipal, school district, and joint economic development district income taxes in Ohio, all subject to the qualifications described herein under the heading LEGAL MATTERS Tax Exemption.

CITY OF CINCINNATI, OHIO $28,000,000* Unlimited Tax Urban Redevelopment Improvement General Obligation Bonds Series 2012D
Dated: Date of Issuance

$5,000,000* Unlimited Tax Urban Redevelopment General Obligation Bonds Series 2012E (Streetcar System)

$30,000,000* Unlimited Tax Various Purpose General Obligation Refunding Bonds Series 2012F
Due: As shown on inside cover

The $28,000,000* Unlimited Tax Urban Redevelopment Improvement General Obligation Bonds, Series 2012D Bonds (the Series 2012D Bonds), $5,000,000* Unlimited Tax Urban Redevelopment General Obligation Bonds, Series 2012E Bonds (Streetcar System) (the Series 2012E Bonds), and the $30,000,000* Unlimited Tax Various Purpose General Obligation Refunding Bonds, Series 2012F Bonds (the Series 2012F Bonds and collectively with the Series 2012D Bonds and the Series 2012E Bonds, the Series 2012 Bonds) of the City of Cincinnati, Ohio (the City) are issuable as fully registered Series 2012 Bonds and, when issued, will be initially registered in the name of Cede & Co., as nominee for The Depository Trust Company, New York, New York (DTC). Purchases of beneficial interests in the Series 2012 Bonds will be made in book-entry-only form. Purchasers of beneficial interests (Beneficial Owners) will not receive certificates representing their interests in the Series 2012 Bonds. So long as the Series 2012 Bonds are registered in the name of Cede & Co., as nominee of DTC, references herein to the owners shall mean Cede & Co. and shall not mean the Beneficial Owners of the Series 2012 Bonds. Payment of the principal of and premium, if any, and interest on, the Series 2012 Bonds will be made directly to DTC or its nominee, Cede & Co., so long as DTC or Cede & Co. is the sole registered owner. Disbursement of such payments to DTCs Participants is the responsibility of DTC, and disbursement of such payments to the Beneficial Owners is the responsibility of DTCs Participants and the Indirect Participants, as more fully described under BOOK-ENTRY ONLY SYSTEM and Appendix D herein. Interest on the Series 2012 Bonds will be payable semi-annually on June 1 and December 1 of each year, beginning June 1, 2013. The Series 2012 Bonds will be issued in authorized denominations of $5,000 and integral multiples thereof. The full faith and credit of the City are irrevocably pledged for the prompt payment of the principal of and interest on the Series 2012 Bonds. See SECURITY AND SOURCE OF PAYMENT herein. The Series 2012 Bonds are subject to redemption prior to their stated maturity as described under SECURITIES BEING OFFERED Redemption Prior to Maturity herein. This cover page includes certain information for quick reference only. It is not a summary of the bond issue. Investors should read the entire Official Statement to obtain information as a basis for making informed investment judgments. The Series 2012 Bonds are offered when, as and if issued and accepted by the Underwriters identified herein, subject to prior sale and the approval of certain legal matters by Peck, Shaffer & Williams LLP, Cincinnati, Ohio, Bond Counsel, and certain other conditions. Certain legal matters will be passed upon for the Underwriters by their counsel, Squire Sanders (US) LLP, Cleveland, Ohio. Public Financial Management, Inc. has acted as Financial Advisor to the City in connection with the issuance of the Series 2012 Bonds. It is expected that delivery of the Series 2012 Bonds will be made in book entry form to DTC in New York, New York on or about December 20, 2012.

PNC CAPITAL MARKETS LLC FIFTH THIRD SECURITIES, INC. RICE FINANCIAL PRODUCTS COMPANY

Preliminary; subject to change.

MATURITY SCHEDULE* Series 2012D Bonds

Year (Dec. 1) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Amount $1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 Interest Rate Yield CUSIP Year (Dec. 1) 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 Amount $1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 1,120,000 Interest Rate Yield CUSIP

Series 2012E Bonds

Year (Dec. 1) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Amount $250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 Interest Rate Yield CUSIP Year (Dec. 1) 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Amount $250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 Interest Rate Yield CUSIP

Series 2012F Bonds

Year (Dec. 1) 2013 2014 2015 2016 2017 2018 Amount Interest Rate Yield CUSIP Year (Dec. 1) 2019 2020 2021 2022 2023 2024 Amount Interest Rate Yield CUSIP

Preliminary; subject to change. Copyright 2012, CUSIP Global Services. CUSIP is a registered trademark of the American Bankers Association. CUSIP Global Services is managed on behalf of the American Bankers Association by Standard & Poors. CUSIP data herein are provided by Standard & Poors, CUSIP Service Bureau, a Division of The McGraw-Hill Companies, Inc. The CUSIP numbers listed are being provided solely for the convenience of the holders only at the time of issuance of the Series 2012 Bonds, and the City does not make any representations with respect to such numbers or undertake any responsibility for their accuracy now or at any time in the future. The CUSIP number for a specific maturity is subject to being changed after the issuance of the Series 2012 Bonds as a result of various subsequent actions, including, but not limited to, a refunding in whole or in part of such maturity or as a result of the procurement of secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a portion of certain maturities of the Series 2012 Bonds.

REGARDING USE OF THIS OFFICIAL STATEMENT The information set forth herein has been obtained from the City and other sources that are believed to be reliable for purposes of this Official Statement. This Official Statement contains, in part, estimates and matters of opinion that are not intended as statements of fact, and no representation is made as to the correctness of such estimates and opinions or that they will be realized. The information and expressions of opinion contained herein are subject to change without notice, and neither the delivery of this Official Statement, nor any sale made hereunder, shall under any circumstances create any implication that there has been no change in the affairs of the City or in the information or opinions set forth herein, since the date of this Official Statement. This Official Statement, which includes the cover pages and the Appendices hereto, does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series 2012 Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. No dealer, broker, salesperson, or other person has been authorized to give any information or to make any representations other than those contained in this Official Statement in connection with the offering of the Series 2012 Bonds, and, if given or made, such other information or representation must not be relied upon as having been authorized by the City. This Official Statement contains statements which, to the extent they are not recitations of historical fact, constitute forward-looking statements. In this respect the words estimate, project, anticipate, expect, intend, believe and similar expressions are intended to identify forward-looking statements. A number of important factors affecting the Citys financial results could cause actual results to differ materially from those stated in the forwardlooking statements. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, give rise to an implication that there has been no change in the affairs of the City since the date hereof. The Underwriters have reviewed the information in this Official Statement in accordance with, and as part of, their responsibility to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the accuracy or completeness of such information. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICES OR YIELDS OF THE SERIES 2012 BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE UNDERWRITERS MAY OFFER AND SELL THE SERIES 2012 BONDS TO CERTAIN DEALERS AND BANKS ACTING AS AGENTS AT PRICES LOWER THAN THE PUBLIC OFFERING PRICES STATED ON THE COVER PAGE HEREOF AND SAID PUBLIC OFFERING PRICES MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITERS.

___________________________

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS OFFICIAL STATEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. [Remainder of page intentionally left blank]

ii

BOND ISSUE SUMMARY FOR SERIES 2012D BONDS The information contained in this Bond Issue Summary is qualified in its entirety by the entire Official Statement, which should be reviewed in its entirety by potential investors. Issuer: Issue: Dated Date: Interest Payment Dates: Principal Payment Dates: Redemption: City of Cincinnati, Ohio. $28,000,000* Unlimited Tax Urban Redevelopment Improvement General Obligation Bonds, Series 2012D. Date of Delivery. Each June 1 and December 1, beginning June 1, 2013. December 1, 2013 through December 1, 2037, inclusive. The Series 2012D Bonds maturing on or after December 1, ____, are subject to redemption, by and at the sole option of the City at any time on or after December 1, _____ in whole or in part, in such order of maturity as may be determined by the City, at a redemption price equal to 100% of the principal amount redeemed, plus accrued interest to the date fixed for redemption. Proceeds derived from the sale of the Series 2012D Bonds described herein will be used to (i) make improvements in the City related to the Streetcar Project (as described herein), including but not limited to, planning and design work, streetcar vehicles, other rolling stock, tracks, electrification system, catenaries, equipment, maintenance and storage facilities, and infrastructure improvements; and (ii) pay legal, advertising, printing, and all expenses incidental to the issuance of the Series 2012D Bonds. The Series 2012D Bonds will be unvoted general obligations of the City and will contain a pledge of the full faith and credit of the City for the payment of the principal of and interest on the Series 2012D Bonds when due. The City maintains the ability to levy an ad valorem tax on all real and personal property in the City subject to ad valorem taxation by the City, without limitation as to rate and amount, unless paid from other sources as they are appropriated and available. Moodys Investors Service and Standard & Poors Ratings Services, have rated the Series 2012D Bonds Aa1 and AA+, respectively.

Purpose:

Security and Sources of Payment:

Credit Ratings:

Preliminary; subject to change.

iii

Tax Exemption:

In the opinion of Bond Counsel, under existing law and assuming compliance with certain covenants, interest on the Series 2012D Bonds is excludible from gross income for federal income tax purposes, is not treated as a specific item of tax preference for purposes of the alternative minimum income tax imposed on individuals and corporations under the Internal Revenue Code of 1986, as amended. The City has not designated the Series 2012D Bonds as qualified tax exempt obligations within the meaning of Section 265(b)(3) of the Code. Interest on the Series 2012D Bonds may be subject to certain federal income taxes imposed on certain corporations, and certain taxpayers may have certain other adverse federal income tax consequences as a result of owning the Series 2012D Bonds. The Series 2012D Bonds, the transfer thereof, and the income therefrom, including any profit made on the sale thereof, will be exempt from taxation within the State of Ohio, all subject to the qualifications described herein. See LEGAL MATTERS Tax Exemption herein. Peck, Shaffer & Williams LLP, Cincinnati, Ohio. PNC Capital Markets LLC, Fifth Third Securities, Inc. and Rice Financial Products Company Squire Sanders (US) LLP, Cleveland, Ohio. Public Financial Management, Inc. U.S. Bank National Association, Cincinnati, Ohio. The Series 2012D Bonds are being issued as fully registered Series 2012D Bonds in book entry form only and book-entry interests therein will be available for purchase in amounts of $5,000 and integral multiples thereof. Owners of book entry interests will not receive physical delivery of bond certificates. The Depository Trust Company or its nominee will receive all payments with respect to the Series 2012D Bonds from the Paying Agent and Registrar. The Depository Trust Company is required by its rules and procedures to remit such payments to its participants for subsequent disbursement to owners of the book entry interests. It is expected that delivery of the Series 2012D Bonds in definitive form will be made on or about December 20, 2012. The Series 2012D Bonds will be released to the Underwriters against payment in federal funds.

Legal Opinion: Underwriters: Underwriters Counsel: Financial Advisor Bond Registrar / Paying Agent: Book-Entry System:

Delivery and Payment:

iv

Further Information:

Questions concerning the Official Statement should be directed to Reginald E. Zeno, Director of Finance, City Hall, Room 250, 801 Plum Street, Cincinnati, Ohio 45202, telephone: (513) 352-3731, fax: (513) 352-2370 or Bethany Pugh, Managing Director, Public Financial Management, Inc., Plaza South One, 7251 Engle Road, Suite 115, Cleveland, Ohio 44130, telephone: (440) 239-7070, fax: (440) 2397074. [Remainder of page intentionally left blank]

BOND ISSUE SUMMARY FOR SERIES 2012E BONDS The information contained in this Bond Issue Summary is qualified in its entirety by the entire Official Statement, which should be reviewed in its entirety by potential investors. Issuer: Issue: Dated Date: Interest Payment Dates: Principal Payment Dates: Redemption: City of Cincinnati, Ohio. $5,000,000* Unlimited Tax Urban Redevelopment General Obligation Bonds, Series 2012E Bonds (Streetcar System). Date of Delivery. Each June 1 and December 1, beginning June 1, 2013. December 1, 2013 through December 1, 2032, inclusive. The Series 2012E Bonds maturing on or after December 1, ______, are subject to redemption, by and at the sole option of the City at any time on or after December 1, ______ in whole or in part, in such order of maturity as may be determined by the City, at a redemption price equal to 100% of the principal amount redeemed, plus accrued interest to the date fixed for redemption. Proceeds derived from the sale of the Series 2012E Bonds described herein will be used to (i) make improvements throughout the City including, certain urban redevelopment activities associated with the Streetcar Project; (ii) refund bond anticipation notes previously issued for the purpose of financing such improvements related to the Streetcar Project; and (iii) pay legal, advertising, printing, and all expenses incidental to the issuance of the Series 2012E Bonds. The Series 2012E Bonds will be unvoted general obligations of the City and will contain a pledge of the full faith and credit of the City for the payment of the principal of and interest on the Series 2012E Bonds when due. The City maintains the ability to levy an ad valorem tax on all real and personal property in the City subject to ad valorem taxation by the City, without limitation as to rate and amount, unless paid from other sources as they are appropriated and available. Furthermore, with respect to the Series 2012E Bonds, in addition to the pledge of such ad valorem property tax revenues, the City may also covenant to annually appropriate other Revenues (as defined below), for the prompt payment of principal and interest on the Series 2012E Bonds. As provided in Ordinance Number 0144-2012, Revenues mean all taxes and revenues, including those defined as TIF Payments, other than ad valorem property taxes, as the City specifies in the Fiscal Officers Certificate to be pledged as

Purpose:

Security and Sources of Payment:

Preliminary; subject to change.

vi

security for the Series 2012E Bonds. TIF Payments mean all service payments of the tax incentive district known as Downtown/RiverfrontTax Incentive District #2. Credit Ratings: Tax Exemption: Moodys Investors Service and Standard & Poors Ratings Services have rated the Series 2012E Bonds Aa1 and AA+, respectively. In the opinion of Bond Counsel, under existing law and assuming compliance with certain covenants, interest on the Series 2012E Bonds is excludible from gross income for federal income tax purposes, is not treated as a specific item of tax preference for purposes of the alternative minimum income tax imposed on individuals and corporations under the Internal Revenue Code of 1986, as amended. The City has not designated the Series 2012E Bonds as qualified tax exempt obligations within the meaning of Section 265(b)(3) of the Code. Interest on the Series 2012E Bonds may be subject to certain federal income taxes imposed on certain corporations, and certain taxpayers may have certain other adverse federal income tax consequences as a result of owning the Series 2012E Bonds. The Series 2012E Bonds, the transfer thereof, and the income therefrom, including any profit made on the sale thereof, will be exempt from taxation within the State of Ohio, all subject to the qualifications described herein. See LEGAL MATTERS Tax Exemption herein. Peck, Shaffer & Williams LLP, Cincinnati, Ohio. PNC Capital Markets LLC, Fifth Third Securities, Inc. and Rice Financial Products Company. Squire Sanders (US) LLP, Cleveland, Ohio. Public Financial Management, Inc. U.S. Bank National Association, Cincinnati, Ohio. The Series 2012E Bonds are being issued as fully registered Series 2012E Bonds in book entry form only and book-entry interests therein will be available for purchase in amounts of $5,000 and integral multiples thereof. Owners of book entry interests will not receive physical delivery of bond certificates. The Depository Trust Company or its nominee will receive all payments with respect to the Series 2012E Bonds from the Paying Agent and Registrar. The Depository Trust Company is required by its rules and procedures to remit such payments to its participants for subsequent disbursement to owners of the book entry interests.

Legal Opinion: Underwriters: Underwriters Counsel: Financial Advisor Bond Registrar / Paying Agent: Book-Entry System:

vii

Delivery and Payment: Further Information:

It is expected that delivery of the Series 2012E Bonds in definitive form will be made on or about December 20, 2012. The Series 2012E Bonds will be released to the Underwriters against payment in federal funds. Questions concerning the Official Statement should be directed to Reginald E. Zeno, Director of Finance, City Hall, Room 250, 801 Plum Street, Cincinnati, Ohio 45202, telephone: (513) 352-3731, fax: (513) 352-2370 or Bethany Pugh, Managing Director, Public Financial Management, Inc., Plaza South One, 7251 Engle Road, Suite 115, Cleveland, Ohio 44130, telephone: (440) 239-7070, fax: (440) 239-7074.

[Remainder of page intentionally left blank]

viii

BOND ISSUE SUMMARY FOR SERIES 2012F BONDS The information contained in this Bond Issue Summary is qualified in its entirety by the entire Official Statement, which should be reviewed in its entirety by potential investors. Issuer: Issue: Dated Date: Interest Payment Dates: Principal Payment Dates: Redemption: City of Cincinnati, Ohio. $30,000,000* Unlimited Tax Various Purpose General Obligation Refunding Bonds, Series 2012F. Date of Delivery. Each June 1 and December 1, beginning June 1, 2013. December 1, 2013 through December 1, _________, inclusive. The Series 2012F Bonds maturing on or after December 1, ______, are subject to redemption, by and at the sole option of the City at any time on or after December 1, ______ in whole or in part, in such order of maturity as may be determined by the City, at a redemption price equal to 100% of the principal amount redeemed, plus accrued interest to the date fixed for redemption. Proceeds derived from the sale of the Series 2012F Bonds described herein will be used to (i) advance refund various outstanding general obligation bonds of the City (the Refunded Bonds), as described in further detail herein under SECURITIES BEING OFFERED Authority for Issuance Series 2012F Bonds and USE OF BOND PROCEEDS Plan of Refunding for the Series 2012F Bonds; and (ii) pay legal, advertising, printing, and all expenses incidental to the issuance of the Series 2012F Bonds. The Series 2012F Bonds will be unvoted general obligations of the City and will contain a pledge of the full faith and credit of the City for the payment of the principal of and interest on the Series 2012F Bonds when due. The City maintains the ability to levy an ad valorem tax on all real and personal property in the City subject to ad valorem taxation by the City, without limitation as to rate and amount, unless paid from other sources as they are appropriated and available. See SECURITIES BEING OFFERED Authority for Issuance Series 2012F Bonds and USE OF BOND PROCEEDS Plan of Refunding for the Series 2012F Bonds. Moodys Investors Service and Standard & Poors Ratings Services, have rated the Series 2012F Bonds Aa1 and AA+, respectively.

Purpose:

Security and Sources of Payment:

Credit Ratings:

Preliminary; subject to change.

ix

Tax Exemption:

In the opinion of Bond Counsel, under existing law and assuming compliance with certain covenants, interest on the Series 2012F Bonds is excludible from gross income for federal income tax purposes, is not treated as a specific item of tax preference for purposes of the alternative minimum income tax imposed on individuals and corporations under the Internal Revenue Code of 1986, as amended. The City has not designated the Series 2012F Bonds as qualified tax exempt obligations within the meaning of Section 265(b)(3) of the Code. Interest on the Series 2012F Bonds may be subject to certain federal income taxes imposed on certain corporations, and certain taxpayers may have certain other adverse federal income tax consequences as a result of owning the Series 2012F Bonds. The Series 2012F Bonds, the transfer thereof, and the income therefrom, including any profit made on the sale thereof, will be exempt from taxation within the State of Ohio, all subject to the qualifications described herein. See LEGAL MATTERS Tax Exemption herein. Peck, Shaffer & Williams LLP, Cincinnati, Ohio. PNC Capital Markets LLC, Fifth Third Securities, Inc. and Rice Financial Products Company. Squire Sanders (US) LLP, Cleveland, Ohio. Public Financial Management, Inc. U.S. Bank National Association, Cincinnati, Ohio. The Series 2012F Bonds are being issued as fully registered Series 2012F Bonds in book entry form only and book-entry interests therein will be available for purchase in amounts of $5,000 and integral multiples thereof. Owners of book entry interests will not receive physical delivery of bond certificates. The Depository Trust Company or its nominee will receive all payments with respect to the Series 2012F Bonds from the Paying Agent and Registrar. The Depository Trust Company is required by its rules and procedures to remit such payments to its participants for subsequent disbursement to owners of the book entry interests. It is expected that delivery of the Series 2012F Bonds in definitive form will be made on or about December 20, 2012. The Series 2012F Bonds will be released to the Underwriters against payment in federal funds.

Legal Opinion: Underwriters: Underwriters Counsel: Financial Advisor Bond Registrar / Paying Agent: Book-Entry System:

Delivery and Payment:

Further Information:

Questions concerning the Official Statement should be directed to Reginald E. Zeno, Director of Finance, City Hall, Room 250, 801 Plum Street, Cincinnati, Ohio 45202, telephone: (513) 352-3731, fax: (513) 352-2370 or Bethany Pugh, Managing Director, Public Financial Management, Inc., Plaza South One, 7251 Engle Road, Suite 115, Cleveland, Ohio 44130, telephone: (440) 239-7070, fax: (440) 2397074. [Remainder of page intentionally left blank]

xi

TABLE OF CONTENTS Page REGARDING USE OF THIS OFFICIAL STATEMENT.............................................................. i BOND ISSUE SUMMARY FOR SERIES 2012D BONDS......................................................... iii BOND ISSUE SUMMARY FOR SERIES 2012E BONDS ......................................................... vi BOND ISSUE SUMMARY FOR SERIES 2012F BONDS ......................................................... ix GENERAL COMMENTS .............................................................................................................. 1 Disclosure Information ............................................................................................................. 1 The Issuer.................................................................................................................................. 1 Offering and Delivery of the Series 2012 Bonds...................................................................... 2 Security and Sources of Payment ............................................................................................. 2 Tax Exemption.......................................................................................................................... 2 Additional Information ............................................................................................................. 3 STREETCAR PROJECT................................................................................................................ 3 Background ............................................................................................................................... 3 Current Project .......................................................................................................................... 4 Streetcar Funding ...................................................................................................................... 6 SECURITIES BEING OFFERED.................................................................................................. 7 Authority for Issuance............................................................................................................... 7 Description of the Securities................................................................................................... 11 Payment of Principal and Interest ........................................................................................... 11 Redemption Prior to Maturity................................................................................................. 11 Book-Entry Only System........................................................................................................ 12 SECURITY AND SOURCE OF PAYMENT .............................................................................. 12 Unlimited Property Tax .......................................................................................................... 12 Full Faith and Credit ............................................................................................................... 12 Additional Sources.................................................................................................................. 13 Payments ................................................................................................................................. 13 USE OF BOND PROCEEDS ....................................................................................................... 13 Use of Proceeds of the Series 2012D Bonds .......................................................................... 13 Use of Proceeds of the Series 2012E Bonds........................................................................... 13 Use of Proceeds of the Series 2012F Bonds Plan of Refunding.......................................... 14 SOURCES AND USES OF FUNDS............................................................................................ 15 RATINGS ..................................................................................................................................... 16 UNDERWRITING ....................................................................................................................... 16 LITIGATION................................................................................................................................ 17 LEGAL MATTERS...................................................................................................................... 17 Tax Exemption........................................................................................................................ 17 Original Issue Premium .......................................................................................................... 19 Original Issue Discount........................................................................................................... 19 Bankruptcy Legislation........................................................................................................... 20 FINANCIAL ADVISOR .............................................................................................................. 21 VERIFICATION OF MATHEMATICAL COMPUTATIONS................................................... 21 INVESTMENT CONSIDERATIONS ......................................................................................... 21 CLOSING CERTIFICATES ........................................................................................................ 21 CONTINUING DISCLOSURE.................................................................................................... 22 EXECUTION STATEMENT....................................................................................................... 25 xii

APPENDICES APPENDIX A APPENDIX B APPENDIX C APPENDIX D THE CITY BASIC FINANCIAL STATEMENTS OPINION OF BOND COUNSEL DEPOSITORY TRUST COMPANY

xiii

(This Page Intentionally Left Blank)

These comments are not a summary of this Official Statement. They are a brief description of and guide to, and are qualified by, more complete and detailed information contained in the entire Official Statement, including the cover page and appendices hereto. A full review should be made of the entire Official Statement. The offering of the Series 2012 Bonds to potential investors is made only by means of the entire Official Statement. GENERAL COMMENTS The purpose of this Official Statement, which includes the cover pages and the appendices hereto, is to provide certain information with respect to the issuance of three series of General Obligation Bonds of the City of Cincinnati, Ohio (the City): (a) $28,000,000* Unlimited Tax Urban Redevelopment Improvement General Obligation Bonds, Series 2012D (the Series 2012D Bonds); (b) $5,000,000* Unlimited Tax Urban Redevelopment General Obligation Bonds, Series 2012E Bonds (Streetcar System) (the Series 2012E Bonds); and (c) $30,000,000* Unlimited Tax Various Purpose General Obligation Refunding Bonds, Series 2012F (the Series 2012F Bonds). The Series 2012D Bonds, the Series 2012E Bonds and the Series 2012F Bonds, in sections with information common to all Series, are referred to collectively as the Series 2012 Bonds. Disclosure Information This Official Statement speaks only as of its date, and the information contained herein is subject to change. This Official Statement and continuing disclosure information of the City are intended to be made available through one or more repositories. Copies of the basic documentation relating to the Series 2012 Bonds, including the authorizing ordinances, are available from the City. The City has deemed this Preliminary Official Statement, dated November 27, 2012, to be final for the purposes of Securities and Exchange Commission Rule 15c2-12(b)(1), except for certain information on the cover page and herein, which was omitted in accordance with such Rule and will be supplied with the final Official Statement. During the past five years, the City has complied in all material respects with its existing continuing disclosure agreements in accordance with Securities and Exchange Commission Rule 15c2-12. The Issuer The Series 2012 Bonds are being issued by the City of Cincinnati, a political subdivision of the State of Ohio. The City, which has a population of 296,943 (based on U.S. Census Bureau data for 2010), is the county seat of Hamilton County in southwestern Ohio (see Appendix A).

Preliminary; subject to change.

Offering and Delivery of the Series 2012 Bonds The Series 2012 Bonds are offered when, as and if issued and accepted by the Underwriters subject to prior sale and the approval of certain legal matters by Peck, Shaffer & Williams LLP. The Series 2012 Bonds will be delivered against payment in federal funds on or about December 20, 2012. Security and Sources of Payment The Series 2012 Bonds are unvoted general obligation debt of the City. The security for the Series 2012 Bonds is the Citys ability to levy an ad valorem tax on all real and personal property in the City subject to ad valorem taxation by the City, without limitation as to rate and amount, unless paid from other sources as they are appropriated and available. Furthermore, with respect to the Series 2012E Bonds, in addition to the pledge of such ad valorem property tax revenues, the City may also covenant to annually appropriate other revenues for the prompt payment of principal and interest on the Series 2012E Bonds. (Such revenues are defined and further discussed herein under SECURITY AND SOURCE OF PAYMENT - Additional Sources.) See SECURITIES BEING OFFERED Authority for Issuance herein for additional information. Tax Exemption Federal Tax Exemption. Under the laws, regulations, rulings, and judicial decisions in effect as of the date hereof, interest on the Series 2012 Bonds is excludible from gross income for federal income tax purposes, pursuant to the Internal Revenue Code of 1986, as amended (the Code). Furthermore, interest on the Series 2012 Bonds will not be treated as a specific item of tax preference, under Section 57(a)(5) of the Code, in computing the alternative minimum tax for individuals and corporations. In rendering the opinions in this paragraph, Bond Counsel has assumed continuing compliance with certain covenants designed to meet the requirements of Section 103 of the Code. Bond Counsel expresses no other opinion as to the federal tax consequences of purchasing, holding, or disposing of the Series 2012 Bonds. The City has not designated the Series 2012 Bonds as qualified tax-exempt obligations with respect to certain financial institutions under Section 265 of the Internal Revenue Code of 1986, as amended (the Code). Ohio Tax Exemption. The Series 2012 Bonds, the transfer thereof, and the income therefrom, including any profit made on the sale thereof, will be exempt from taxation within the State of Ohio, all subject to the qualifications described herein. Form of Opinion. See Appendix C hereto for the form of the opinion that Bond Counsel proposes to deliver in connection with the Series 2012 Bonds.

Additional Information Additional information concerning this Official Statement, as well as copies of the documentation relating to the Series 2012 Bonds, is available from Reginald E. Zeno, Director of Finance, City Hall, Room 250, 801 Plum Street, Cincinnati, Ohio 45202, (513) 352-3731 or Bethany Pugh, Managing Director, Public Financial Management, Inc., Plaza South One, 7251 Engle Road, Suite 115, Cleveland, Ohio 44130, telephone: (440) 239-7070, fax: (440) 239-7074. STREETCAR PROJECT The Series 2012 Bonds will be unvoted general obligations of the City and will contain a pledge of the full faith and credit of the City for the payment of the principal of and interest on the Series 2012 Bonds when due. Accordingly, the City's obligation to pay the principal of and interest on the Series 2012 Bonds is not restricted to or dependent on revenues derived from the Streetcar Project. The discussion below regarding the Streetcar Project should be understood in that context. Background Feasibility Study and Environmental Assessment. In evaluating means to foster economic development and improve transportation between the Downtown area of the City and areas outside this core and comparing the experiences of other cities nationwide, the City identified streetcar transit as a potential tool for improving local circulation, supporting sustainable community and economic development, and complementing other components of the local and regional transportation system. In 2006, the City commissioned HDR, Inc.1 (HDR) to conduct the Cincinnati Streetcar Feasibility Study (the Feasibility Study), which was completed in July 2007. The Feasibility Study included a benefit-cost analysis of the proposed Streetcar project (the Streetcar Project), based on a four-mile streetcar loop which would extend from The Banks riverfront development, through Downtown, and into the Over-the-Rhine neighborhood.2 In 2009 HDR also completed the Cincinnati Streetcar Uptown Connector Feasible Alternatives Study, an assessment which focused on the technical evaluation of alternative routes connecting Downtown and Uptown. According to the Feasibility Study, the estimated economic impacts of the Streetcar Project over 30 years would include $379 million in increased property values and $34 million in additional property taxes. Based on comparisons with other U.S. communities that completed streetcar projects, the Feasibility Study estimated over $1.4 billion in redevelopment of vacant and underutilized properties in the corridor surrounding the route.

HDR is a global firm providing architecture, engineering, consulting, construction and related services through its various operating companies. HDR was founded in 1917 and is currently headquartered in Omaha, Nebraska. It currently has more than 185 locations and 8,000 professionals worldwide. 2 In 2008, the University of Cincinnatis Economic Center for Education and Research performed an assessment of the Feasibility Study and made a determination that the Feasibility Study is credible in its analysis of the costs and benefits of streetcars in Cincinnati and in its projections of the benefits of ridership and economic development.

In June 2011, in accordance with the National Environmental Policy Act of 1969 (NEPA), the City of Cincinnati prepared an Environmental Assessment (EA) of the potential social, environmental and economic impacts with respect to the Streetcar route as then proposed. Based on the EA, the Federal Transit Administration (FTA) issued a Finding of No Significant Impact (FONSI). An addendum to the FONSI was issued by FTA in February 2012 to include the additional segments of the final Streetcar route. Legislative and Political History. On April 23, 2008, the City Council voted 6-2 in favor of building Streetcar lines to link the Downtown, Over-the-Rhine, and Uptown areas of the City. Opponents of the Streetcar Project gathered signatures for a ballot initiative known as Issue 9, which would have amended the City's Charter and forced a public vote on the Streetcar Project. On November 3, 2009, Issue 9 failed, losing 56% to 44%. Under the administration of Governor John Kasich, the Ohio Transportation Review Advisory Council denied approximately $52 million in State funds which had been tentatively awarded to the Streetcar Project by the previous administration. In response, the City revised Phase One of the Streetcar Project to shorten the route, removing the segments connecting to the Uptown area and The Banks riverfront development. After the defeat of Issue 9 in 2009, opponents of the Streetcar Project began collecting signatures in 2011 for a similar ballot initiative. This referendum, known as Issue 48, differed by banning any spending on rail until December 31, 2020 rather than requiring a City-wide vote for spending. The proposal would have banned spending regardless of the source of funds. Issue 48 was defeated 52% to 48% on November 8, 2011. In December 2011, the City was awarded a $10.9 million grant through the U.S. Department of Transportation - Transportation Investment Generating Economic Recovery (TIGER) III Program (the TIGER III Grant). Such funds will be used to extend the Streetcar route to The Banks riverfront development. In June 2012, Representative Steve Chabot of Ohio introduced in the U.S. House of Representatives an amendment to the Transportation, Housing and Urban Development, and Related Agencies Appropriations Act of 2013 (the Chabot Amendment) which prohibits the allocation of any federal money to the Streetcar Project in fiscal year 2013. The Chabot Amendment was approved by the U.S. House of Representatives, but requires passage by the U.S. Senate and signing by the President in order to become law. The federal grants listed below under STREETCAR PROJECT Streetcar Funding would not be affected even in the event that the Chabot Amendment becomes law, as such Amendment would only apply to fiscal year 2013 funds. Current Project The City officially broke ground on the Streetcar Project in February 2012. The final design of the Streetcar Project has been completed, providing for a route from Henry Street near Findlay Market to The Banks riverfront development (see Figure 1). There will be five modern cars on this first segment of the Streetcar route, operating along 3.6 mile route on embedded, instreet rail, with stops located about every two blocks along the route. In September 2012, CAF 4

USA was selected to build the five cars. The City plans to solicit bids in the fall of 2012 for a construction contractor to begin construction in early 2013. Assuming this occurs, construction will take approximately two years, with an additional six months for testing. Passenger service for the Streetcar is expected to begin in summer 2015. The City is in ongoing negotiations with Duke Energy regarding the relocation of some utility facilities to resolve physical conflicts with the embedded, in-street rail. The City is providing $15 million toward the payment of the costs of utility relocation. The City is seeking reimbursement from Duke Energy for such costs. While the ultimate disposition of these ongoing negotiations cannot be determined at this time, it is the opinion of the City Solicitor that the City will recover such costs from Duke Energy. [Remainder of page intentionally left blank]

Figure 1

Streetcar Funding The projected cost of the Streetcar Project is $125.4 million. Funding is expected to be provided from local sources and federal grants as follows:
Federal Funds Urban Circulator Grant (Federal Transit Administration) Congestion Mitigation & Air Quality (CMAQ) Grant (Ohio-Kentucky-Indiana Regional Council of Governments) TIGER III Grant (U.S. Dept. of Transportation) Sub-total City Funds Bond Proceeds, from bonds to be supported as follows: Property Tax Capital (General Obligation Bonds) Tax Increment Financing (TIF) Proceeds from the Blue Ash Airport Sale (Construction) Proceeds from the Blue Ash Airport Sale (Duke relocation) Cash (Other Development Fund Revenue) Duke Energy/Streetlight Sale Proceeds & Private Contributions Sub-total Grand Total Amount $24,990,000.00 4,000,000.00 10,920,000.00 $39,910,000.00

$28,000,000.00 11,000,000.00 11,000,000.00 15,000,000.00 14,000,000.00 6,500,000.00 $85,500,000.00 $125,410,000.00

Approximately $14.31 million of the projected $125.4 million has been spent and another $6.05 million is encumbered contractual obligations.
_______ Source: City of Cincinnati, Ohio

SECURITIES BEING OFFERED Authority for Issuance Authority for the City to issue bonds emanates from Articles VIII and XVIII of the Constitution of the State of Ohio. Statutory provisions are contained in the Ohio Revised Code, Section 133, Uniform Securities Act. The Series 2012 Bonds, described herein, are lawfully issued in accordance with Article VIII, Section 4 of the City Charter of the City which provides for the levy of ad valorem taxes on all property in the City subject to ad valorem taxes for satisfying principal and interest requirements unless paid from other sources.

Series 2012D Bonds. On May 12, 2010, pursuant to Ordinance No. 0143-2010, the City Council authorized the issuance of Urban Redevelopment Improvement Bonds aggregating $28,000,000. Such Urban Redevelopment Improvement Bonds shall be issued as the Series 2012D Bonds. Pursuant to such authorization, the City is proceeding with the sale of those bonds, as described in the table below. Series 2012D Bonds
Ordinance # Series Name 0143-2012 Unlimited Tax Urban Redevelopment Improvement General Obligation Bonds 25 Years $28,000,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $1,120,000.00 $28,000,000.00

Maturity Amount Amortization 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 TOTALS

[Remainder of page intentionally left blank]

Preliminary; subject to change.

Series 2012E Bonds. On May 12, 2010, pursuant to Ordinance No. 0144-2010, the City Council authorized the issuance of bonds to be designated as Urban Redevelopment Bonds (Streetcar System) aggregating $25,000,000. A portion of such Urban Redevelopment Bonds (Streetcar System) in the amount of $5,000,000 shall be issued as the Series 2012E Bonds. Pursuant to such authorization, the City is proceeding with the sale of those bonds, as described in the table below. Series 2012E Bonds
Ordinance # Series Name 0144-2010 Unlimited Tax Urban Redevelopment General Obligation Bonds Series 2012E (Streetcar System) 20 Years $5,000,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $ 250,000.00 $5,000,000.00

Maturity Amount Amortization 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 TOTALS

[Remainder of page intentionally left blank]

Preliminary; subject to change.

Series 2012F Bonds. On May 2, 2012, the City Council adopted Ordinance No. 01422012, authorizing the issuance of bonds in an amount not to exceed $70,000,000 in order to advance refund all or a portion of the outstanding principal amounts of the following bonds: (i) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2004A, dated May 6, 2004, originally issued in the principal amount of $44,365,000 (the Refunded Series 2004A Bonds); (ii) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2005A, dated June 1, 2005, originally issued in the principal amount of $26,300,000 (the Refunded Series 2005A Bonds); (iii) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2005B (Additional Municipal Income Tax Pledge), dated June 1, 2005, originally issued in the principal amount of $5,200,000 (the Refunded Series 2005B Bonds); (iv) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2006A, dated June 8, 2006, originally issued in the principal amount of $32,995,000 (the Refunded Series 2006A Bonds); (v) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2006B (Additional Municipal Income Tax Pledge), dated June 8, 2006, originally issued in the principal amount of $14,195,000 (the Refunded Series 2006B Bonds); (vi) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2008A, dated March 27, 2008, originally issued in the principal amount of $34,100,000 (the Refunded Series 2008A Bonds); (vii) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2008B (Additional Municipal Income Tax Pledge), dated March 27, 2008, originally issued in the principal amount of $10,000,000 (the Refunded Series 2008B Bonds); (viii) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2009A, dated July 22, 2009, originally issued in the principal amount of $39,250,000 (the Refunded Series 2009A Bonds); and

10

(ix) A portion in the amount of $_________ of the remaining outstanding principal amount of the Citys Unlimited Tax Various Purpose General Obligation Bonds, Series 2009B (Additional Municipal Income Tax Pledge), dated July 22, 2009, originally issued in the principal amount of $25,000,000 (the Refunded Series 2009B Bonds and collectively with the bonds listed in (i) through (viii) above, the Refunded Bonds). (See USE OF BOND PROCEEDS Series 2012F Bond Proceeds Plan of Refunding.) Description of the Securities General. The Series 2012 Bonds are general obligations of the City. The Series 2012 Bonds will pay interest semi-annually on the first day of June and December beginning June 1, 2013. Interest shall be computed on the basis of a 360-day year consisting of twelve 30-day months. Principal will be payable on the Series 2012 Bonds (either upon scheduled maturity or mandatory redemption) on the first day of December in the years and amounts as provided on the respective cover page hereto for each series, until final maturity. The Series 2012 Bonds shall be issued as fully registered bonds. The bond registrar and paying agent (the Registrar) for the Series 2012 Bonds is U.S. Bank National Association, Cincinnati, Ohio. Legal matters incident to the issuance of the Series 2012 Bonds and with regard to the tax status of the interest thereon are subject to the approving legal opinion of Peck, Shaffer & Williams LLP, Cincinnati, Ohio, Bond Counsel. The Underwriters for the Series 2012 Bonds are PNC Capital Markets LLC, Fifth Third Securities, Inc. and Rice Financial Products Company (collectively, the Underwriters). Payment of Principal and Interest The Series 2012 Bonds will be issued in denominations of $5,000 each or any integral multiple thereof. Principal of the Series 2012 Bonds is payable, without deduction for exchange, collection, or service charges on each principal payment date to the person whose name appears on the bond registration records on the 15th day of the calendar month preceding the principal payment date as the registered holder thereof (initially, The Depository Trust Company). Interest thereon shall be paid, without deduction for any exchange, collection, or service charges, on each interest payment date to the person whose name appears on the bond registration records on the 15th day of the calendar month preceding the interest payment date as the registered holder thereof (initially, The Depository Trust Company). Redemption Prior to Maturity Optional Redemption. The Series 2012 Bonds maturing on or after December 1, _____ are subject to redemption, by and at the sole option of the City at any time on or after December 1, ______ in whole or in part, in such order of maturity as may be determined by the City, at a redemption price equal to 100% of the principal amount redeemed, plus accrued interest to the date fixed for redemption. Selection of Bonds for Redemption. When partial redemption of any Series 2012 Bonds is authorized, the Bond Registrar will select Series 2012 Bonds or portions thereof by lot within a maturity in such manner as the Bond Registrar may determine, or as directed by the City, 11

provided, however, that the portion of any Series 2012 Bonds so selected will be in the amount of $5,000 or an integral multiple thereof. Notice of Redemption. The notice of the call for redemption of any Series 2012 Bonds shall identify (i) by designation, letters, numbers, or other distinguishing marks the Series 2012 Bonds, or portions thereof, to be redeemed, (ii) the redemption price to be paid, (iii) the date fixed for redemption, and (iv) the place or places where the amounts due upon redemption are payable. From and after the specified redemption date and provided that funds are on hand and available for the payment of interest due as of the redemption date, interest on the respective Series 2012 Bonds (or portions thereof) called for redemption shall cease to accrue. Such notice shall be sent by registered or certified mail at the address shown in the Bond registration records not less than 30 days nor more than 60 days prior to the date of redemption. Failure to receive such notice or any defect therein shall not affect the validity of the proceedings for the redemption of any Series 2012 Bonds. Book-Entry Only System The Series 2012 Bonds will be issued as Book Entry Only Bonds. The Depository Trust Company (DTC), New York, New York, will act as securities depository for the Series 2012 Bonds. The Series 2012 Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTCs partnership nominee). One fully-registered Series 2012 Bond certificate will be issued for each maturity of the same interest rate of the Series 2012 Bonds in the aggregate principal amount of such maturity and will be deposited with DTC. See Appendix D for further description of The Depository Trust Company. SECURITY AND SOURCE OF PAYMENT Unlimited Property Tax The Series 2012 Bonds are unvoted general obligation debt of the City. The security for the Series 2012 Bonds is the Citys ability to levy an ad valorem tax on all real and personal property in the City subject to ad valorem taxation by the City without limitation as to rate and amount unless paid from other sources. (See Ad Valorem Tax Base in Appendix A.) A 1977 decision of the Ohio First District Court of Appeals, which the Supreme Court of Ohio declined to review, upheld the right of the City, in accordance with the Citys Charter, to levy property taxes without limitation in excess of the ten-mill limitation contained in Section 5705.02 of the Ohio Revised Code to support its lawfully issued bonds and notes and established that the Citys ability to incur debt will be limited only by the arithmetical (percentage) limitations contained in Section 133.05 of the Ohio Revised Code. (See Applicable Debt Limitations in Appendix A.) Full Faith and Credit The ordinances authorizing issuance of the Series 2012 Bonds provides further security by making a general pledge of the full faith and credit of the City for the payment of principal and interest on the Series 2012 Bonds as the same become due. Included in such general pledge are all funds of the City except those specifically limited to another use or prohibited from use 12

for such debt service by the Ohio Constitution or Ohio or Federal laws such as tax levies voted for specific purposes and taxes levied for debt service on specific voted general obligation bond issues. Additional Sources With respect to the Series 2012E Bonds, in addition to the pledge of such ad valorem property tax revenues, the City may also covenant to annually appropriate other Revenues (as defined below), for the prompt payment of principal and interest on the Series 2012E Bonds. As provided in Ordinance Number 0144-2012, Revenues mean all taxes and revenues, including those defined as TIF Payments, other than ad valorem property taxes, as the City specifies in the Fiscal Officers Certificate to be pledged as security for the Series 2012E Bonds. TIF Payments mean all service payments of the tax incentive district known as Downtown/Riverfront- Tax Incentive District #2). Payments Principal and semi-annual interest on the Series 2012 Bonds will be paid by U.S. Bank National Association, as bond registrar and paying agent. So long as DTC or its nominee, Cede & Co., is the bondholder, such payments will be made to Cede & Co., which in turn will remit such payments to the DTC Direct Participants (as defined in Appendix D) and DTC Indirect Participants (as defined therein) for subsequent disbursement to the Beneficial Owners (as defined therein) of the Series 2012 Bonds. Interest will be payable on December 1, 2012, and semiannually thereafter on each June 1 and December 1 until final maturity. Principal will be payable annually on the Series 2012 Bonds (either upon scheduled maturity or mandatory redemption) on the first day of December in the years and amounts as provided on the inside cover page hereto, until final maturity. Upon receipt of principal or interest payments, DTCs current practice is to credit immediately the accounts of Participants (as defined therein) in accordance with their respective positions as shown on DTCs records. USE OF BOND PROCEEDS Use of Proceeds of the Series 2012D Bonds The Series 2012D Bonds are being issued for the purpose of (i) providing funding for certain urban redevelopment activities improvements in the City related to the Streetcar Project, including but not limited to, planning and design work, streetcar vehicles, other rolling stock, tracks, electrification system, catenaries, equipment, maintenance and storage facilities, and infrastructure improvements; and (ii) paying legal, advertising, printing, and all expenses incidental to the issuance of the Series 2012D Bonds. Use of Proceeds of the Series 2012E Bonds The Series 2012E Bonds are being issued for the purpose of (i) providing funding for certain urban redevelopment activities throughout the City related to the Streetcar Project; (ii) refunding bond anticipation notes in the principal amount of $5,000,000 previously issued for the purpose of financing such improvements related to the Streetcar Project; and (iii paying legal, advertising, printing, and all expenses incidental to the issuance of the Series 2012E Bonds. 13

Use of Proceeds of the Series 2012F Bonds Plan of Refunding The Series 2012F Bonds are being issued for the purpose of (i) advance refunding the Refunded Bonds (detailed below) and (ii) paying legal, advertising, printing, and all expenses incidental to the issuance of the Series 2012F Bonds. The net proceeds of the Series 2012F Bonds will be applied to the advance refunding of the Refunded Bonds, with the result that the Refunded Bonds will be deemed to be paid and no longer outstanding. Refunded Bonds Bond Series Maturity Date (Dec. 1) Principal Amount Redemption Date (Dec. 1) Redemption Price

Interest Rate

TOTAL The net proceeds of the Series 2012F Bonds will be deposited in an irrevocable escrow account held by an escrow trustee pursuant to an Escrow Agreement between the City and the escrow trustee. Such proceeds will be used immediately to purchase direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America or other obligations the principal of and interest on which are fully secured by the foregoing in such amounts and maturities, and bearing interest at rates, so as to provide sufficient moneys to pay when due certain maturities of the principal and interest due on the Refunded Bonds.

14

SOURCES AND USES OF FUNDS The following table sets forth the sources and uses of funds by the City in connection with the issuance of the Series 2012D Bonds and the Series 2012E Bonds.
SOURCES Principal Amount Plus Original Issue Premium Less Original Issue Discount TOTAL SOURCES: USES Deposit with the City to pay respective Project Costs Deposit to the Citys Bond Retirement Fund Bond Issuance Expenses (1) TOTAL USES:
_________ * Preliminary; subject to change. (1) Includes underwriters discount, printing costs, rating agency fees, legal fees and other issuance costs.

Series 2012D $28,000,000.00*

Series 2012E $5,000,000.00*

The following table sets forth the sources and uses of funds by the City in connection with the issuance of the Series 2012F Bonds:
SOURCES Proceeds from Sale of Series 2012F Bonds: Par Value of Series 2012F Bonds Plus Original Issue Premium Less Original Issue Discount TOTAL SOURCES: USES Refunding Escrow Deposits Cash Deposit Escrow Securities Bond Issuance Expenses(1) TOTAL USES:

__________
(1)

Includes underwriters discount, printing costs, rating agency fees, legal fees and other issuance costs.

[Remainder of page intentionally left blank]

15

RATINGS As noted on the cover page of this Official Statement, Moodys Investors Service and Standard & Poors Ratings Services, a division of The McGraw-Hill Companies, Inc. (Standard & Poors), have accorded ratings to the Series 2012 Bonds of Aa1 and AA+", respectively. Such ratings reflect only the respective views of such organizations and an explanation of the significance of such ratings, outlooks or statements may be obtained from the rating agency furnishing the same. The City has supplied and expects to provide the rating agencies with additional information that may not be included herein. The City can provide no assurance that the ratings accorded the Series 2012 Bonds will continue for any given period of time or that the ratings will not be revised upward, downward, or withdrawn entirely by either or both rating agencies, if, in the judgment of either or both organizations, circumstances so warrant. Any downward revision or withdrawal of such ratings may have an adverse effect on the market price of the Series 2012 Bonds. UNDERWRITING The Underwriters have agreed, subject to certain conditions, to purchase the Series 2012 Bonds from the City as follows: (a) The Series 2012D Bonds at a purchase price of $________, which is equal to the par amount of the Series 2012D Bonds of $28,000,000.00*, [plus net original issue premium] [less net original issue discount] of $________, less underwriters discount of $________. The net amount received by the City will be $________, which is equal to the purchase price of $_________, less $_________, representing the costs of issuance to be retained by the Underwriters to be paid on behalf of the City [, less premium in the amount of $_________ to be applied to the payment of costs of issuance for the Series 2012E Bonds]. (b) The Series 2012E Bonds from the City at a purchase price of $________, which is equal to the par amount of the Series 2012E Bonds of $5,000,000.00*, [plus net original issue premium] [less net original issue discount] of $________, less underwriters discount of $_______. The net amount received by the City will be $_______, which is equal to the purchase price of $________, less $_______, representing the costs of issuance to be retained by the Underwriters to be paid on behalf of the City [, plus premium from the proceeds of the Series 2012D Bonds in the amount of $_______ to be applied to the payment of the costs of issuance of the Series 2012E Bonds]. (c) The Series 2012F Bonds from the City at a purchase price of $________, which is equal to the par amount of the Series 2012F Bonds of $__________*, [plus net original issue premium] [less net original issue discount] of $________, less underwriters discount of $_______. The net amount received by the City will be $________, which is equal to the purchase price of $_________, less $________,
*

Preliminary; subject to change.

16

representing the costs of issuance to be retained by the Underwriters to be paid on behalf of the City. The Underwriters are obligated to purchase all of the Series 2012 Bonds, pursuant to the Bond Purchase Agreement, dated November __, 2012. The Series 2012 Bonds may be offered and sold by the Underwriters to certain dealers at prices lower than the public offering price, and the public offering price may be changed from time to time. LITIGATION To the knowledge of the City no litigation, administrative action or proceeding is pending or threatened, restraining or enjoining, or seeking to restrain or enjoin, the validity, issuance and delivery of the Series 2012 Bonds. The City is a party to numerous legal proceedings. Although none of these legal proceedings relate directly to the Series 2012 Bonds or the security therefore, some involve claims against the City for substantial amounts. While the ultimate disposition of these pending legal proceedings cannot be determined at this time, it is the opinion of the City Solicitor that the pending legal proceedings will not have a material adverse effect on the Series 2012 Bonds or the security for the Series 2012 Bonds. On June 22, 2011, the American Federation of State, County and Municipal Employees, AFL-CIO (AFSCME), filed suit in the Court of Common Pleas, Hamilton County, Ohio, Civil Division, against the City of Cincinnati, the Cincinnati Retirement System (CRS), and others. The lawsuit requests that the Court (i) take the necessary steps to determine the contribution amount owed to CRS by the City, (ii) establish a mechanism for collection of amounts owed to CRS, and (iii) contribute the amounts owed by the City to CRS. In addition, the City is currently a party in two other lawsuits filed by City employee members of CRS and is likely to be a party in other legal proceedings seeking damages or injunctive or other relief with respect to CRS and changes implemented by City Council that reduce retiree benefits. The City continues to support its existing budget practices with respect to CRS, and the City has responded in all of these proceedings and intends to vigorously defend these lawsuits. The ultimate disposition of these proceedings is not now determinable, and the outcome of such lawsuits, and its impact, if any, on the Citys finances cannot be predicted, but in the opinion of the City Solicitor, the ultimate disposition of these proceedings will not have a material adverse effect on the Series 2012 Bonds or the security for the Series 2012 Bonds. LEGAL MATTERS Tax Exemption In the opinion of Peck, Shaffer & Williams LLP, Bond Counsel for the Series 2012 Bonds, based upon an analysis of existing laws, regulations, rulings and court decisions, interest on the Series 2012 Bonds will be excludible from gross income for federal income tax purposes. Bond Counsel is also of the opinion that interest on the Series 2012 Bonds will not be a specific item of tax preference under Section 57 of the Internal Revenue Code of 1986 (the Code) for purposes of the federal individual or corporate alternative minimum taxes. Furthermore, Bond Counsel is of the opinion that interest on the Series 2012 Bonds will be exempt from taxation, 17

including personal income taxation, by the State of Ohio and its political subdivisions, and is excludible from the net income base used in calculating the Ohio corporate franchise tax. A copy of the opinion of Bond Counsel is set forth in Appendix C, attached hereto. The Code imposes various restrictions, conditions, and requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Series 2012 Bonds. The City has covenanted to comply with certain restrictions designed to ensure that interest on Series 2012 Bonds will not be includable in gross income for federal income tax purposes. Failure to comply with these covenants could result in interest on the Series 2012 Bonds being includable in income for federal income tax purposes and such inclusion could be required retroactively to the date of issuance of the Series 2012 Bonds. The opinion of Bond Counsel assumes compliance with these covenants. However, Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken) or events occurring (or not occurring) after the date of issuance of the Series 2012 Bonds may adversely affect the tax status of the interest on the Series 2012 Bonds. Certain requirements and procedures contained or referred to in the ordinances authorizing the Series 2012 Bonds and other relevant documents may be changed and certain actions (including, without limitation, defeasance of the Series 2012 Bonds) may be taken or omitted under the circumstances and subject to the terms and conditions set forth in such documents. Bond Counsel expresses no opinion as to any Series 2012 Bonds or the interest thereon if any such change occurs or action is taken or omitted upon the advice or approval of bond counsel other than Peck, Shaffer & Williams LLP. Although Bond Counsel is of the opinion that interest on the Series 2012 Bonds will be excludible from gross income for federal and Ohio income tax purposes, the ownership or disposition of, or the accrual or receipt of interest on, the Series 2012 Bonds may otherwise affect a Bondholders federal, state or local tax liabilities. The nature and extent of these other tax consequences may depend upon the particular tax status of the Bondholder or the Bondholders other items of income or deduction. Bond Counsel expresses no opinions regarding any tax consequences other than what is set forth in its opinion and each Bondholder or potential Bondholder is urged to consult with tax counsel with respect to the effects of purchasing, holding or disposing the Series 2012 Bonds on the tax liabilities of the individual or entity. For example, although Bond Counsel is of the opinion that interest on the Series 2012 Bonds will not be a specific item of tax preference for the federal alternative minimum tax, corporations are required to include all tax-exempt interest in determining adjusted current earnings under Section 56(c) of the Code, which may increase the amount of any alternative minimum tax owed. Receipt of tax-exempt interest, ownership or disposition of the Series 2012 Bonds may result in other collateral Federal, state or local tax consequence for certain taxpayers. Such effects include, without limitation, increasing the federal tax liability of certain foreign corporations subject to the branch profits tax imposed by Section 884 of the Code, increasing the federal tax liability of certain insurance companies, under Section 832 of the Code, increasing the federal tax liability and affecting the status of certain S Corporations subject to Sections 1362 and 1375 of the Code, increasing the federal tax liability of certain individual recipients of Social

18

Security or Railroad Retirement benefits, under Section 86 of the Code and limiting the amount of the Earned Income Credit under Section 32 of the Code that might otherwise be available. Ownership of any Series 2012 Bonds may also result in the limitation of interest and certain other deductions for financial institutions and other taxpayers, pursuant to Section 265 of the Code. Finally, residence of the holder of 2011 Bonds in a state other than Ohio or being subject to tax in a state other than Ohio, may result in income or other tax liabilities being imposed by such states or their political subdivisions based on the interest or other income from the Series 2012 Bonds. The City has not designated the Series 2012 Bonds as qualified tax-exempt obligations under Section 265 of the Code. Prospective purchasers of the Series 2012 Bonds are advised to consult their own tax advisors prior to any purchase of the Series 2012 Bonds as to the impact of the Internal Revenue Code of 1986, as amended and state tax statutes, upon their acquisition, holding or disposition of the Series 2012 Bonds. Original Issue Premium "Acquisition Premium" is the excess of the cost of a bond over the stated redemption price of such bond. The Series 2012 Bonds maturing from ________________ (collectively, the "Premium Bonds") are being initially offered and sold to the public with Acquisition Premium. For federal income tax purposes, the amount of Acquisition Premium on the Premium Bonds must be amortized and will reduce the bondholders adjusted basis in that bond. However, no amount of amortized Acquisition Premium on the Premium Bonds may be deducted in determining bondholders taxable income for federal income tax purposes. The amount of any Acquisition Premium paid on the Premium Bonds that must be amortized during any period will be based on the "constant yield" method, using the original bondholders basis in such Premium Bonds and compounding semiannually. This amount is amortized ratably over that semiannual period on a daily basis. Holders of any Premium Bonds, both original purchasers and any subsequent purchasers, should consult their own tax advisors as to the actual effect of any Acquisition Premium with respect to their own federal income tax situation and as to the treatment of the Acquisition Premium for state tax purposes. Original Issue Discount The Series 2012 Bonds that mature ________________ (the "Discount Bonds") are being initially offered and sold to the public at an original issue discount ("OID") from the amounts payable at maturity thereon. OID is the excess of the stated redemption price of a note at maturity (the face amount) over the "issue price" of such note. The issue price is the initial offering price to the public (other than to bond houses, brokers or similar persons acting in the capacity of underwriters or wholesalers) at which a substantial amount of Bonds of the same maturity are sold pursuant to that initial offering. For federal income tax purposes, OID on each Bond will accrue over the respective term of the Bond, and for the Discount Bonds, the amount of accretion will be based on a single rate of interest, compounded semiannually or over a shorter

19

permitted compounding interval selected by the holder (the "yield to maturity"). The amount of OID that accrues during each semi-annual period will do so ratably over that period on a daily basis. With respect to an initial purchaser of a Discount Bond at its issue price, the portion of OID that accrues during the period that such purchaser owns the Discount Bond is added to such purchasers tax basis for purposes of determining gain or loss at the maturity, redemption, sale or other disposition of that Discount Bond and thus, in practical effect, is treated as stated interest, which is excludable from gross income for federal income tax purposes. A purchaser of a Discount Bond in the initial public offering at the price for that Discount Bond, stated on the inside cover pages of this Official Statement, who holds that Discount Bond to maturity will realize no gain or loss upon the retirement of that Discount Bond. In addition, OID that accrues in each year to a holder of a Discount Bond is included in the calculation of the distribution requirements of certain regulated investment companies and may result in some of the collateral federal income tax consequences discussed above. Consequently, holders of any Discount Bond should be aware that the accrual of OID in each year may result in an alternative minimum tax liability, additional distribution requirements or other collateral federal income tax consequences although the holder of such Discount Bond has not received cash attributable to such OID in such year. Bankruptcy Legislation Chapter 9 of the Federal Bankruptcy Code contains provisions relating to the adjustment of debts of a states political subdivisions, public agencies and instrumentalities (each an eligible entity), such as the City. Under the Bankruptcy Code and in certain circumstances described therein, an eligible entity may be authorized to initiate Chapter 9 proceedings without prior notice to or consent of its creditors, which proceedings may result in a material and adverse modification or alteration of the rights of its secured and unsecured creditors, including holders of its bonds and notes. Section 133.36 of the Ohio Revised Code permits a political subdivision, such as the City, for the purpose of enabling such subdivision to take advantage of the provisions of the Bankruptcy Code, and for that purpose only, and upon approval of the State Tax Commissioner, to file a petition stating that the subdivision is insolvent or unable to meet its debts as they mature, and that it desires to effect a plan for the composition or readjustment of its debts, and to take such further proceedings as are set forth in the Bankruptcy Code as they relate to such subdivision. The taxing authority of such subdivision may, upon like approval of the State Tax Commissioner, refund its outstanding securities, whether matured or unmatured, and exchange refunding bonds for the securities being refunded. In its order approving such refunding, the State Tax Commissioner shall fix the maturities of the bonds to be issued, which shall not exceed thirty years. No taxing subdivision is permitted, in availing itself of the provisions of the Bankruptcy Code, to scale down, cut down or reduce the principal sum of its securities except that interest thereon may be reduced in whole or in part. The Federal Bankruptcy Code and Section 133.36 of the Ohio Revised Code also permit the County to initiate Chapter 9 proceedings, which, because the County collects certain revenues on behalf of the City, particularly ad valorem taxes, may adversely affect the financial condition of the City.

20

FINANCIAL ADVISOR Public Financial Management, Inc. is serving as the financial advisor to the City in connection with the issuance and sale of the Series 2012 Bonds. The financial advisor is not obligated to undertake, and has not undertaken to make, an independent verification or to assume responsibility for the accuracy, completeness, or fairness of the information contained in the Official Statement. Public Financial Management, Inc. is an independent advisory firm and is not engaged in the business of underwriting, trading or distributing municipal securities or other public securities. VERIFICATION OF MATHEMATICAL COMPUTATIONS _____________________, independent certified public accountants and consultants (the Verification Agent), will deliver a report dated the date of issuance of the Series 2012F Bonds verifying the accuracy of (i) the mathematical computations of the adequacy of the maturing principal amounts of the applicable permitted investments deposited pursuant to the Escrow Agreement, including the interest income to be realized thereon, to pay interest on the Refunded Bonds as the same becomes due and payable on the interest payment dates prior to their redemption dates, and to pay the redemption price and accrued interest on the redemption date for the Refunded Bonds, and (ii) the mathematical computations supporting the conclusion of Bond Counsel that the Series 2012F Bonds are not arbitrage bonds under Sections 103(b)(2) and 148 of the Internal Revenue Code, as amended. Such verifications will be based upon certain information supplied to the Verification Agent by the Underwriters or the Financial Advisor. INVESTMENT CONSIDERATIONS The Series 2012 Bonds, like most obligations of state and local governments, are subject to changes in value due to changes in the condition of the tax-exempt bond market or changes in the financial condition of the City. It is possible under certain market conditions, or if the financial condition of the City should change, that the market price of the Series 2012 Bonds could be adversely affected. With regard to the risk involved in a lowering of the Citys bond rating, see RATINGS herein. With regard to creditors rights, see LEGAL MATTERS - Bankruptcy Legislation herein. CLOSING CERTIFICATES At closing, the City will deliver to the purchaser a complete, certified transcript of proceedings with respect to the Series 2012 Bonds, including or accompanied by the usual closing papers, including the following: (1) A Signature and No-Litigation Certificate, signed by the officials who sign the Series 2012 Bonds, stating in effect that no litigation is pending or to the knowledge of such officials threatened affecting the security for the Series 2012 Bonds;

21

(2) A Certificate Respecting Official Statement, stating in effect that the Official Statement, as of both the date of sale and the date of delivery of the Series 2012 Bonds, did not and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements herein, in light of the circumstances under which they were made, not misleading; that there has been no material adverse change in the financial condition or affairs of the City, from that set forth in or contemplated by the Official Statement; that the Preliminary Official Statement with respect to the Series 2012 Bonds was deemed to be final by the City as of its date pursuant to Securities and Exchange Commission Rule 15c2-12(b)(1), except for certain information on the cover page thereof, which was omitted in accordance with such Rule and was to be supplied with the final Official Statement, and that the final Official Statement was deemed to be final by the City as of its date pursuant to SEC Rule 15c212(b)(3); and (3) Treasurer. A receipt for payment for the Series 2012 Bonds, signed by the City CONTINUING DISCLOSURE In accordance with the Securities and Exchange Commission Rule 15c2-12 (the Rule) and so long as the Series 2012 Bonds are outstanding the City (the Obligated Person) will agree pursuant to a Continuing Disclosure Certificate to be dated as of December 20, 2012, to be delivered on the date of delivery of the Series 2012 Bonds, to cause the following information to be provided: (i) to the Municipal Securities Rulemaking Board (MSRB), certain annual information and operating data, including audited financial statements, generally consistent with the information contained in the Citys general purpose financial statements (annual financial information); such information shall be provided on or before September 30 of each year for the fiscal year ending on the preceding December 31; (ii) to the MSRB, in a timely manner, not in excess of ten business days after the occurrence of the event, notice of the occurrence of the following events with respect to the Series 2012 Bonds: (a) (b) (c) difficulties; (d) difficulties; (e) perform; Principal and interest payment delinquencies; Non-payment related defaults, if material; Unscheduled draws on debt service reserves reflecting financial Unscheduled draws on credit enhancements reflecting financial Substitution of credit or liquidity providers, or their failure to

22

(f) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the security, or other material events affecting the tax-exempt status of the security; (g) Modifications to rights of security holders, if material;

(h) Bond calls, if material, and tender offers (except for mandatory scheduled redemptions not otherwise contingent upon the occurrence of an event); (i) Defeasances;

(j) Release, substitution or sale of property securing repayment of the securities, if material; (k) Rating changes;

(l) Bankruptcy, insolvency, receivership or similar event of the obligated person (Note: For the purposes of this event, the event is considered to occur when any of the following occur: The appointment of a receiver, fiscal agent or similar officer for an obligated person in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the obligated person, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the obligated person); (m) The consummation of a merger, consolidation, or acquisition involving an obligated person or the sale of all or substantially all of the assets of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and (n) Appointment of a successor or additional trustee or the change of name of a trustee, if material; and Note: The U.S. Securities and Exchange Commission (SEC) requires the listing of events (a) through (n) although some of such events may not be applicable to the Series 2012 Bonds.

23

(iii) to the MSRB, notice of a failure (of which the Obligated Person has knowledge) of an Obligated Person to provide the required annual financial information on or before the date specified in its written continuing disclosure undertaking. As required by the Rule, the Continuing Disclosure Certificate provides that the information to be filed with the MSRB described in the preceding paragraph is to be filed in an electronic format as prescribed by the MSRB, accompanied by identifying information as prescribed by the MSRB. An MSRB rule change approved by the Securities and Exchange Commission establishes a continuing disclosure service of the MSRBs Electronic Municipal Market Access system (EMMA) for the receipt of, and for making available to the public, continuing disclosure documents and related information to be submitted pursuant to continuing disclosure undertakings (such as the Continuing Disclosure Certificate) entered into on or after July 1, 2009, consistent with the Rule. In general, all continuing disclosure documents and related information are to be submitted to the MSRBs continuing disclosure service through an Internet-based electronic submitter interface (EMMA Dataport) or electronic computer-tocomputer data connection, accompanied by certain identification information, in portable document format (PDF) files configured to permit document to be saved, viewed, printed and retransmitted by electronic means and must be word-searchable. The Continuing Disclosure Certificate provides bondholders with certain enforcement rights in the event of a failure by the Obligated Person to comply with the terms thereof; however, a default under the Continuing Disclosure Certificate does not constitute a default under the Authorizing Legislation. The Continuing Disclosure Certificate may be amended or terminated under certain circumstances in accordance with the Rule as more fully described therein. Holders of the Series 2012 Bonds are advised that the Continuing Disclosure Certificate, copies of which are available at the office of the Obligated Person, should be read in its entirety for more complete information regarding its contents. For purposes of this transaction with respect to events as set forth in the Rule: (a) Bonds; (b) (c) (d) there are no credit enhancements applicable to the Series 2012 Bonds; there are no liquidity providers applicable to the Series 2012 Bonds; and there is no property securing the repayment of the Series 2012 Bonds. there are no debt service reserve funds applicable to the Series 2012

During the past five years, the City has complied in all material respects with its existing continuing disclosure agreements in accordance with Securities and Exchange Commission Rule 15c2-12. [Remainder of page intentionally left blank]

24

EXECUTION STATEMENT This Official Statement has been duly executed and delivered on behalf of the City by its City Manager. CITY OF CINCINNATI, OHIO By: Milton Dohoney, Jr., City Manager Dated: December __, 2012

25

(This Page Intentionally Left Blank)

APPENDIX A THE CITY [SEE ATTACHED]

(This Page Intentionally Left Blank)

DESCRIPTION OF THE CITY ...............................................................................................................A-2 Government and History..............................................................................................................A-2 Area..............................................................................................................................................A-2 City Council.................................................................................................................................A-2 Administrative Officers ...............................................................................................................A-3 Major Municipal Services Provided ............................................................................................A-4 Employee Relations .....................................................................................................................A-8 Collective Bargaining ..................................................................................................................A-9 City of Cincinnati Retirement System .......................................................................................A-10 INDUSTRY AND BUSINESS...............................................................................................................A-12 Metropolitan Area......................................................................................................................A-12 Twenty-Five Largest Employers in the Cincinnati-Middletown MSA......................................A-13 Employment Statistics ...............................................................................................................A-14 Unemployment Statistics ...........................................................................................................A-15 Exports and Foreign Investment ................................................................................................A-15 Economic Development.............................................................................................................A-15 Transportation............................................................................................................................A-27 Mass Media................................................................................................................................A-28 Cultural Opportunities ...............................................................................................................A-28 Higher Education .......................................................................................................................A-29 Primary and Secondary Education.............................................................................................A-29 Greater Cincinnati Recreation Facilities ....................................................................................A-30 Sports .........................................................................................................................................A-30 Utilities.......................................................................................................................................A-30 Five-Year Capital Improvement Plan ........................................................................................A-30 Convention Facilities Authority for Hamilton County, Ohio Convention Facilities Authority Revenue Bonds ..........................................................................................................................A-31 DEBT STRUCTURE..............................................................................................................................A-31 Unlimited Tax ............................................................................................................................A-31 Bonds and Notes Authorized, Outstanding and Unissued .........................................................A-32 Net General Tax Supported Bonds ............................................................................................A-34 Applicable Debt Limitations......................................................................................................A-34 Overlapping Debt.......................................................................................................................A-36 Bond Retirement Fund...............................................................................................................A-36 Revenue Debt Pay-Out Ratio.....................................................................................................A-37 Outstanding Bonds and Notes....................................................................................................A-40 Ad Valorem Tax Base................................................................................................................A-41 Assessed Valuation ....................................................................................................................A-42 Tax Levy, Collections and Collection Rate ...............................................................................A-42 Twenty Largest Ad Valorem Taxpayers in City of Cincinnati 2011 .........................................A-43 Tax Duplicate and Levies per $1,000 Assessed Valuation ........................................................A-44 Investment Policy Summary ......................................................................................................A-44 Municipal Fiscal Emergencies...................................................................................................A-44 General Fund Major Revenue Categories..................................................................................A-45 Management's Discussion of Operations ...................................................................................A-47

A-1

APPENDIX A DESCRIPTION OF THE CITY Government and History Cincinnati was founded in 1788, chartered as a village in 1802, and incorporated as a City in 1819. Major revisions to the City Charter were approved by voters in 1926 to provide for home rule and the council-manager form of government. Population Cincinnati - City Hamilton County Cincinnati PMSA* Census 2010 296,943 802,374 2,130,151 Census 2000 331,285 845,303 1,646,395 Census 1990 364,040 866,228 1,526,092

Source: Bureau of the Census, U.S. Commerce Department. *The definition of PMSA from 2000 to 2010 changed to include Franklin County, IN, Bracken County, KY, and Butler County, OH.

Area Cincinnati Hamilton County Metropolitan Area City Council Commencing in December 2001, the City's form of government was modified based on a charter amendment approved by the voters in 1999. For the first time in November 2001, the Mayor was chosen through a direct election and the nine-members of City Council were chosen in a separate at-large election. The Mayor is elected to a four-year term and City Council members are elected to two-year terms. Term limits enacted in November 1993 limit a person to holding the office of member of City Council to four two-year terms. The Mayor is limited to two consecutive four-year terms. The Mayor presides over the City Council meetings, but is not a member of the City Council. The Mayor has no vote on council legislation but may exercise veto authority, which can be overridden by a vote of six Council members (two-thirds majority). Although the Mayor does not vote on Council legislation, the Mayor can introduce legislation to the City Council and may call special meetings of the City Council. The Mayor appoints the City Manager subject to prior approval of the City Council. The Mayor may commence proceedings for the removal of the City Manager but such removal shall require City Council approval. The Mayor is responsible for submitting the annual budget estimate prepared by the City Manager to City Council. The Mayor may not amend the budget estimate but may provide the City Council with written comments related to any aspect of the proposed budget. The Mayor retains the authority to declare a time of public emergency and may, with consent of City Council, take command of the police, maintain order, and enforce the law during the period of public emergency. [Remainder of page intentionally left blank] 77 sq. miles 413 sq. miles 3,343 sq. miles

A-2

The following table lists the incumbents and the term each is presently serving. Name Hon. Mark Mallory, Mayor Hon. Roxanne Qualls Hon. Laure Quinlivan Hon. Chris Seelbach Hon. Yvette Simpson Hon. P.G. Sittenfeld Hon. Christopher Smitherman Hon. Cecil Thomas Hon. Charlie Winburn Hon. Wendell Young Administrative Officers Name Milton R. Dohoney, Jr. Scott C. Stiles David L. Holmes Reginald E. Zeno John P. Curp Position City Manager Assistant City Manager Assistant City Manager Finance Director City Solicitor Term Second Third Second First First First First Fourth Second Second

City Manager: Milton R. Dohoney, Jr. has served as City Manager since August 2006 overseeing a staff of more than 5,000 employees and a combined budget of $1 billion. He has over 30 years of experience in local government, with the bulk of his career being spent in Louisville, Kentucky. Before coming to Cincinnati, Mr. Dohoney served as the Chief Administrative Officer for the Lexington Fayette Urban County Government. He is recognized as the founder of the Regional Neighborhood Network. The RNN is an organization comprised of 20 cities in five states which partner community based organizations with local government to improve conditions in neighborhoods. Mr. Dohoney is a member of the International City/County Management Association (ICMA), which awarded him the Credentialed Manager designation. He holds degrees from the University of Louisville and Indiana University Southeast. Assistant City Manager: Scott C. Stiles has served as Assistant City Manager since February 2005. Mr. Stiles' responsibilities include intergovernmental affairs, operating agency issues, and he serves as the City Manager's union liaison. Mr. Stiles began his career with the City in 1988. Since August 2002, he has served as an Assistant to the City Manager and was named the Interim Director of the City's newly-created Business Development and Permit Center. Prior work included management of the Law Department's Real Estate and Relocation offices. Mr. Stiles has a Master's Degree in Community Planning from the University of Cincinnati and a Bachelor of Science degree in Journalism and Geography from South Dakota State University. He currently serves on the local advisory board of the Urban Land Institute. He has also served as a member of the International City/County Management Association's Governmental Affairs and Policy Committee, and the Cincinnati-Kharkiv Sister City Association.

A-3

Assistant City Manager: David L. Holmes joined the City of Cincinnati's leadership team as Assistant City Manager in November 2007. Appointed by City Manager Milton Dohoney, Jr., Mr. Holmes provides departmental oversight, as well as overseeing two special project areas, the Banks development and priority economic development projects. Mr. Holmes is an attorney by training with Political Science and Law Degrees from the University of Kentucky. He was both a prosecutor and defense attorney in the Office of the Staff Judge Advocate at Fort Bragg. He also worked at the Defense Appellate Division for the U.S. Army Legal Service Agency in Virginia. In addition to several years in private practice, he has eight years' experience working in local government at the Lexington Fayette Urban County Government. There he served as Director of Litigation and Commissioner of Law and handled various special projects for the Chief Administrator's Office. Finance Director: Reginald E. Zeno joined the City of Cincinnati's leadership team as Finance Director in late June 2010. He previously served as Chief Financial Officer/Finance Director for the City of New Orleans from 2002 to 2010, and held the Chief of Staff and Budget Director positions for the Transit Management of Southeast Louisiana from 2000 to 2002. He also worked for the New Orleans Public Schools from 1980 to 2000 serving in several positions including Interim Chief Financial Officer for several years. He is a member of the Government Finance Officers Association, where he also served as a reviewer for the Distinguished Budget Award Program from 1989 to 1998. Mr. Zeno holds a Bachelor of Science in Business Administration from the University of Louisiana at Lafayette and a Masters of Business Administration from Tulane University. City Solicitor: John P. Curp has served as the City Solicitor since September 2008. Prior to becoming City Solicitor, he was an attorney with the law firm of Taft, Stettinius & Hollister LLP beginning in 1995. He was a partner with the firm from 2003 to 2008. Mr. Curp was awarded a degree of Bachelor of Science in Business from Miami University. He earned his degree of Doctor of Jurisprudence from the Indiana University School of Law. Major Municipal Services Provided The City provides the full range of municipal services. The most significant are described in this section. Fire. The Cincinnati Fire Department has an authorized complement of 841 uniformed employees who respond to emergencies including fire suppression, emergency medical services, hazardous materials, weapons of mass destruction, explosive ordnance disposal, technical rescues, and special emergencies to property throughout the City of Cincinnati. The department's current emergency response components are located in 26 fire stations that house 26 engine companies, 12 ladder companies, 12 paramedic units, two heavy rescue companies, and an aircraft rescue fire-fighting unit. The department's nonemergency response capabilities include fire prevention, fire code enforcement, public fire education and outreach, fire investigation, environmental crimes investigation, firefighter training, and other essential staff support functions. These administrative functions are housed at five locations. Police. With an authorized complement of 1,115 uniformed police officers, the Police Department provides services to reduce crime, improve public safety, and improve quality of life in the City. The Police Department has successfully implemented Community Problem Oriented Policing (CPOP), an extension of Community Oriented Policing (COP), and uses this program to help solve quality of life and crime problems in neighborhoods and schools.

A-4

Public Services. The Department of Public Service maintains streets, bridges, viaducts, and walls in a safe condition, provides for the placement of traffic control devices, curb control, pavement markings, roadway lighting, solid waste collection, street cleaning, green space management, neighborhood improvement programs, community clean-up services, the City's centralized customer services center, fleet services and the management of City facilities. Fleet Services provides all City agencies the automotive equipment necessary to perform their functions. Fleet Services is also responsible for maintaining equipment, providing fuel, and for the timely removal of obsolete and underutilized equipment. This includes 24 hour 7 days per week support services for a 3,500-unit fleet. Recreation. The City's Department of Recreation provides senior and therapeutic recreation programs, after school programs, summer day camps, and Citywide athletic programs that include individual and team competition for volleyball, baseball, softball, basketball, tennis and touch football at the City's many outdoor recreation facilities. Parks. The Department of Parks holdings constitute more than 5,000 acres. These holdings consist of 5 regional parks, 70 neighborhood parks, 34 preserves and natural areas, 5 parkways, 65 miles of hiking and bridle trails, 80,000 street trees on 1,000 miles of City streets, 5 nature centers, 18 scenic overlooks, 52 playgrounds, 500 landscaped gardens and over 100 picnic areas. Health. The Cincinnati Health Department's (CHD) mission is to assist in achieving and sustaining the residents' highest level of health and to assure the provision of public health services that promote health, social well-being and prevention of injury and disease in people and communities throughout the City of Cincinnati. CHD is responsible for the promotion, protection, and maintenance of the public's health. This responsibility is achieved by development and enforcement of health laws, prevention of disease, the development of policies that advance health promotion wellness, prevention of disease, education, health equity, social justice and fiscal services. Core Programs under the supervision of CHD and the Health Commissioner include: Technical Resources: Provides professional, technical, and administrative support in the areas of human resources, electronic data processing, fiscal services, and facility management. Technical Resources also provides all vital records (birth certificates and death certificates) as required by State law. Community and Environmental Health Services: Responsible for Environmental Services, which includes food service, solid waste, vector control, animal bites, household sewage, swimming pool inspection, environmental hygiene, nuisance abatement, smoking ban enforcement, and litter patrol. This Division is also responsible for health promotion, including health education and health promotion grants, the Public Employee Assistance Program, and the Lead Risk Assessment program. Population Health and Clinical Services: Provides comprehensive primary health care and dental services for underserved and high-risk populations. This Division operates six health centers and a sexually transmitted disease center. Also provided are laboratory, pharmacy, immunization, and nutritional services. Other responsibilities are public health nursing programs that include home health and school health.

A-5

Enterprise Technology Solutions(ETS). ETS provides information and communications technology to over 20 local governments, law enforcement agencies, and other customers in the southwest Ohio region, including the City of Cincinnati and Hamilton County governments. The department provides support to over 5,300 e-mail clients and 6,423 voice lines. Planning & Buildings. Through enforcement of state and local building and zoning requirements, the City Planning and Buildings Department preserves and promotes public health, safety, quality of life, and economic well-being as related to the built environment. The City Planning and Buildings Department includes the divisions of City Planning and Buildings & Inspections. The Buildings and Inspections Division (B&I) is responsible for the issuance of licenses and permits, the inspections of all new construction, alterations, additions, as well as, related plumbing and mechanical work. The duties of the B&I Division include the examination of plans to ensure that they comply with the requirements of the Zoning Code and the Building Code and the handling of appeals on building and zoning code enforcement. The B&I Division is also responsible for the daily operations of the Business Development and Permits Center. Community Development. The primary service areas of the Department are Housing, Business Development, Property Maintenance/Code Enforcement and Human Services. Economic Development Division.(EDD) The Economic Development Division of the City Managers Office is responsible for facilitating the creation of private sector jobs and investment throughout the city. The division accomplishes this goal by serving as a liaison between the City Administration and companies and developers, acquiring and repositioning underutilized property, investing in public improvements that catalyze private investment, and providing tax and financial assistance to select projects and companies. EDDs primary communication tool, www.choosecincy.com, won the International Economic Development Councils General Purpose Website award for 2010. Enterprise Services. Enterprise Services consists of two divisions: the Duke Energy Convention Center and Parking Facilities. The Duke Energy Convention Center and Parking Facilities are managed through the City Manager's office. Duke Energy Convention Center. The Duke Energy Convention Center contributes to the economic growth and stability of Cincinnati by providing a facility to host international, national, and regional convention and trade shows, as well as public expositions and other meetings. About 604,603 people attended approximately 172 events held at the convention center in 2010. The Duke Energy Convention Center recently completed a $135 million expansion and renovation in 2006. On March 22, 2011, the Ohio Tax Commissioner issued a Final Determination denying the City's real property tax exemption application for the parcel purchased by the City for the 2006 convention center expansion. That parcel is one of 17 parcels which comprise the Duke Energy Convention Center property. As a result of such ruling, the Tax Commissioner ordered the Hamilton County Auditor to restore the other 16 parcels to the tax list and duplicate for tax year 2011. The City has appealed the Tax Commissioner's Final Determination to the Ohio Board of Tax Appeals and is awaiting notice of a hearing. The City has appealed the valuation of all of the Duke Energy Center parcels to the Hamilton County Board of Revision for tax year 2010 and has received a reduction in value from approximately $192,000,000.00 to $143,000,000.00. That A-6

decision was not appealed. The market values for all of the Duke Energy Convention Center parcels have been further reduced to approximately $106,300,000.00 for tax year 2011 going forward as a result of the Auditor's sexennial reappraisal of Hamilton County property occurring in 2011. Assuming tax rates remain constant, any reduction in market values will reduce any real property tax liability going forward. As part of the State of Ohio 2012 budget bill, the Ohio General Assembly passed legislation to exempt Ohio convention center facilities similarly situated to the Duke Energy Center from real property taxation. Said legislation is prospective as well as retroactive. It eliminates all real property tax liability for the Center. In August, 2011, the Ohio Board of Tax Appeals agreed to remand the City's appeal to the Tax Commissioner to act in accordance with such legislation. On September 30, 2011, the Cincinnati Public Schools filed suit in the Franklin County, Ohio Court of Common Pleas against the City, County, and State to invalidate the legislation based on state constitutional grounds and to enjoin the Tax Commissioner from issuing an exemption based on the legislation. The litigation is ongoing. On February 21, 2012, the Tax Commissioner issued a final determination to grant an exemption for parcel 145-2-57 in accordance with the legislation. On April 9, 2012, Cincinnati Public Schools appealed that final determination to the Ohio Board of Tax Appeals. The City is defending and will continue to vigorously defend the lawsuit and the administrative appeals. Parking Facilities. Provides professional facility management of the City's fourteen parking garages/lots. Parking Facilities, which operates on a financially selfsufficient basis, manages 5,600 on-street and 5,341 off-street parking spaces. Water Works. The Greater Cincinnati Water Works (GCWW) provides water and water related services to the entire City of Cincinnati, most of Hamilton County and additional service areas in the adjacent Ohio counties of Butler, Warren, and Clermont, and in Kentucky, Boone County. The rapid growth of communities surrounding the existing service area, a lack of readily available source water in these areas and the costs associated with building new treatment plants, has presented the Utility with opportunities to provide a regional water service to these communities. GCWW is responsible for the complete administration, operation, maintenance, and capital planning of the water system. The system supplies approximately 50 billion gallons of water a year through 3,100 miles of water mains to more than 240,000 residential and commercial accounts representing nearly 2 million consumers. While 90% of total revenue comes from the sale of water, GCWW has also expanded other core services to local communities. These nonwater services include stormwater, wastewater, solid waste and yard waste billing, call center operations, lab analysis, professional engineering, monitoring and maintenance services. On October 26, 2011, Cincinnati City Council approved joint utility management of the Greater Cincinnati Water Works, Metropolitan Sewer District of Greater Cincinnati and Stormwater Management Utility. On March 28, 2012, the City Manager approved the Joint Utility Management 100 Day Plan. Within the 100 Day Plan, the Transition Core Team comprised of Superintendents from the Utilities identified sixty-two action items under ten functional areas which will result in rates increasing at lower levels than they would otherwise, improvement in levels of service to customers, cost savings and efficiencies, and will increase Cincinnatis opportunity to continue to grow as a national leader in water resource management. These action items are set to begin May 7, 2012.

A-7

Metropolitan Sewer District. The Department of Sewers protects and enhances water quality and the environment by providing safe and efficient wastewater collection and treatment. The City is responsible for the management and operation of the Metropolitan Sewer District of Greater Cincinnati on behalf of Hamilton County, while Hamilton County is owner of the Sewer District as promulgated in Chapter 6117 of the Ohio Revised Code. The District's service area encompasses 400 square miles and it serves approximately 850,000 residents through a network of 3,000 miles of main line sewers and over 200,000 sewer connections. The District operates a number of treatment plants that collectively treat 200 million gallons of sewage daily. The Department also manages the City's Stormwater Management Utility. It is responsible for the operation, maintenance, and repair of 350 miles of storm sewers; 30,000 Stormwater inlets; 450 intakes; five pump stations, including the 9-billion gallon per-day Barrier Dam Pump Station; and the City's 1.5 mile long floodwall. Transportation and Engineering. The Department of Transportation provides transportation planning, urban and architectural design, civil engineering, geotechnical expertise, surveying, and graphics design, transportation asset management, traffic and airport operation management and control, and construction and project management. Employee Relations The City employs approximately 5,900 full and part-time employees, of whom 4,908 are full-time and 992 are part-time. The City's 2012 Budget includes funding for 5,771.2 full-time equivalent (FTE) positions. (A FTE position equals 2,088 hours per year.) The City has managed to maintain good relations with the six unions representing its employees: The American Federation of State, County, and Municipal Employees (AFSCME); the Cincinnati Organized and Dedicated Employees (CODE); the Fraternal Order of Police (FOP); the International Association of Fire Fighters (IAFF); the Building Trades, and the Teamsters. [Remainder of page intentionally left blank]

A-8

A summary of the six bargaining units' representation of City employees and the status of the City contracts with each are summarized in the table below. Summary of City Labor Contracts
Approximate No. of Employees Represented 1,807 Contract Effective Date 8/8/2010 Contract Termination Date 8/7/2013

Bargaining Unit AFSCME

Contract Wage Increase 0% first 2 years, with a wage reopener 3rd year 0% per year 0% per year 0% per year 0% per year 0% per year $1,500 lump sum 1st year, 3% 2nd and 3rd years 0% Wage reopener in 2013 and 2014

FOP (NonSupervisors) FOP(Supervisors) IAFF Building Trades CODE Teamsters* AFSCME MWs TOTAL

786 232 771 36 858 18 112 4,620

6/2011 6/2011 10/30/2012 5/17/2012 3/22/2011 10/3/2010 3/4/12

12/2014 12/2014 5/24/2014 5/16/2014 3/30/2013 10/26/2013 3/2015

______
*No contract extension has been ratified by the Teamsters or the City.

Collective Bargaining Am. Sub. S.B. 133, which enacted Chapter 4117, Ohio Revised Code (the "Collective Bargaining Law"), became fully effective on April 1, 1984. The Collective Bargaining Law establishes procedures for and regulates public employer-employee collective bargaining and labor relations for state and local governmental units in Ohio, including the City. The Collective Bargaining Law creates a three-member State Employment Relations Board (the "SERB"). The SERB administers and enforces the Collective Bargaining Law. Among other things, the Collective Bargaining Law: (i) creates rights and obligations of public employers, public employees and employee organizations with respect to labor relations; (ii) defines which employees are covered by the Collective Bargaining Law; (iii) establishes methods for (a) the recognition of employee organizations as exclusive representatives for collective bargaining and (b) the determination of bargaining units; (iv) establishes matters for which collective bargaining is (a) required, (b) prohibited and (c) optional with the public employer; (v) establishes procedures for bargaining and the resolution of disputes, including negotiations, mediation and fact finding; (vi) permits all employees covered under the Collective Bargaining Law to strike, except certain enumerated classes of employees including police and fire personnel. Disputes with employees who are not permitted to strike (including police and fire personnel) are to be resolved by binding arbitration on a best offer, issue by issue basis. If a strike by employees who are permitted to strike presents a clear and present danger to the public health or safety, the Common Pleas Court may issue a temporary restraining order against the strike for not to exceed 72 hours, and in such a case the employer may request authorization of the SERB to enjoin the strike beyond the period of the temporary restraining order. The SERB determines if a clear and present danger to the public health or safety exists, and if it so determines, the Court of Common Pleas issuing the temporary restraining order has jurisdiction to further enjoin the strike for a period of 60 A-9

days after the end of the temporary restraining order or when agreement is reached, whichever occurs first. Thereafter, no court has jurisdiction to issue injunctive or other orders and a strike may be resumed at the end of such 60 day period. The Collective Bargaining Law establishes certain employer and employee and employee-organization unfair labor practices and remedies for such unfair labor practices. The Collective Bargaining Law applies to the City. Changes to the Collective Bargaining Law were adopted by the Ohio General Assembly and signed by Governor Kasich in March 2011. Referred to as Senate Bill 5 ("SB5"), these changes limited public employee collective bargaining rights, including such measures as removing the continuation, modification, or deletion of an existing collective bargaining agreement as a subject for collective bargaining; expanding the list of subjects that are not subject to collective bargaining; banning automatic deductions from employee paychecks that would support the unions' political action committees, except as allowed in Campaign Finance Law; establishing a process for placing last-best-offers of certain public employers on the local ballot for a vote; and not permitting public employers to bargain on any subject reserved to the management and direction of the governmental unit, even if the subject affects wages, hours, and terms and conditions of employment. SB5 also abolished the right to strike for all public employees and replaces existing law on work stoppages and binding arbitration with a progressive "dispute settlement" process that would resolve terms of employment through a mediator, a fact-finder, and finally a hearing conducted by the governing body of the public employer representing management, if needed. However, SB5 was repealed by referendum on a statewide ballot on November 8, 2011 and therefore will not go into effect. City of Cincinnati Retirement System The City of Cincinnati Retirement System (the "System") is primarily comprised of employees of the City. It also covers certain employees of the University of Cincinnati and University Hospital who opted to remain in this Retirement System at the time the University was transferred to the State in July 1977. In addition, certain Hamilton County employees were permitted to remain in the System when the Municipal Courts, the Air Pollution Control Program, and Community Correctional Institution were transferred to Hamilton County. As of December 31, 2011, there were 2,948 covered full-time employees and 4,418 covered retirees in the System. This represents a 2.5% decrease in active membership and less than .05% increase in the number of retired members receiving a pension benefit. The current ratio of actives to retirees remains steady at 0.7:1, the same as the prior year. The System is financed through contributions from the employees and the employer as well as income earned on investments of the System. The University of Cincinnati, University Hospital and Hamilton County each pay the annual employer contribution for their respective employees in the System. The employer contribution rate for 2011 was 17.0% of employee payroll. On May 3, 2012 the System's actuary presents the December 31, 2011 Annual Valuation of the Retirement System Pension Report and Retiree Health Benefits Report to the Retirement System Board of Trustees. Each report takes into account audited investment results as well as actuarial assumptions consistent with the actual experience of the System and that are consistent with accepted actuarial procedures. The respective reports note that the market value of assets for the System, net of other receivables and liabilities, was $1.97 billion for the year ended December 31, 2011 compared to $2.1 billion for the year ended December 31, 2010, a decrease of 6.2%. The actuarial value of assets was $2.15 billion as of December 31, 2011 compared to $2.29 billion as of December 31, 2010, a decrease of 6.1%. (The decrease in the actuarial value of assets was primarily due to continued recognition of losses from 2008, under performance of investments in 2011, and the Boards decision to lower the discount rate from 8.0% to 7.5%) The Annual Valuation reports suggest that employer contributions to the System be set at a rate A-10

of 42.45% of payroll for pension and 2.94% of payroll for retiree health benefits for the fiscal year ending December 31, 2013. Setting the contribution rates as suggested may result in significant reprogramming of budgetary priorities of the City for fiscal year 2013 and beyond. The City's biennial budget is approved by City Council, typically before December 31 of each year. The reports note that the System is 67.0% funded for pension as of December 31, 2011 compared to 75% funded as of December 31, 2010. The reports note that the System is 104% funded for healthcare as of December 31, 2011 compared to 111% funded as of December 31, 2010. In 2010, City Council changed the membership of the Retirement Board of Trustees to include six appointed industry professionals, and five trustees elected by active and retired members. The new Board presented recommendations to Council that were approved in March 2011. The pension changes became effective July 1, 2011 and the health care changes became effective January 1, 2012. The changes included a reduction in the annual cost of living adjustment (COLA) from an automatic 3% compound rate to a simple COLA indexed to inflation and capped at 2.0% in any given year. The COLA reduction applies to active employees who become eligible to retire on or after July 1, 2011. The final average salary used to calculate the monthly pension benefit increased from 3 years to 5 years highest average salary for active employees who become eligible to retire after January 1, 2014. Certain transition benefits apply to members who become eligible to retire before January 1, 2014. This change applies to prospective benefits only. Pension benefits earned up to June 30, 2011, or January 1, 2014 for members eligible to retire before this date, will be based on three years highest average salary. Benefits earned after these dates will be based on five years highest average salary. The benefit accrual rate used to calculate the monthly pension benefit decreased from 2.50% to 2.20% of base pay for the first 30 years of service. After 30 years of service the benefit accrual rate drops to 2.00% of base pay. This change applies to active employees who become eligible to retire after January 1, 2014, and applies to prospective benefits only. Benefits earned up to June 30, 2011, or January 1, 2014 for members eligible to retire before this date are based on the 2.50% accrual rate, while benefits earned after these dates are based on the reduced 2.20% accrual rate. Eligibility requirements for normal retirement have been increased from 30 years of service and any age, or 5 years of service and age 60, to 30 years of service and age 60 (62 if hired on or after 1/1/2010), or 5 years of service and age 65 (67 if hired on or after 1/1/2010). The requirement for early retirement increased from age 55 with 25 years of service to age 57 with 15 years of service with benefits actuarially reduced. Post-retirement death benefits for current retirees were reduced from $7500 to $5000 and are eliminated for members who retire on or after July 1, 2011. The pre-retirement death benefit of 50% of the active member's prior 12 months' salary was eliminated. Effective January 1, 2012, there were three significant changes to retiree healthcare benefits. Medical benefits were moderately scaled back and premium cost sharing was implemented for the majority of retirees. Medicare Part B premiums are no longer reimbursed for retirees and spouses. And retirees who choose dental or vision benefits pay 100% of the premium costs. The December 31, 2010 actuarial valuation reports indicated that the changes described above reduced the total unfunded liability by $342.3 million. Of this total, pension liabilities were reduced by $111.4 million and health care liabilities by $230.8 million. A-11

In 2011, City Council approved an Ordinance that increases employer contributions to the System in a graduated fashion from 17% to 24% by 2015. The Retirement Board lowered the discount rate from 8% to 7.5%. And the Board determined that all employer contributions will be directed to the pension trust, with no funds directed to the retiree health care trust, until the pension trust becomes stabilized. The following table contains information concerning the contributions and other financial data:
2011 Number of Covered Employees1 Employee Contribution Rate Employee Contributions2 Employer Contribution Rate Employer Contributions2 Benefits Paid2 Unfunded Actuarial Liability3 Net Assets held in Trust for Benefits2
________
1

2010 3,024 7.5% $13,350,121 17% $31,537,622 $186,912,000 $452,597,371 $2,101,500,000

2009 3,148 7% $12,417,473 17% $30,461,651 $198,104,000 $625,701,680 $1,991,825,000

2008 3,088 7% $11,843,821 17% $27,248,943 $188,217,000 $913,886,608 $1,816,140,000

2,948 8.0% $14,171,000 17% $31,160,000 $197,401,000 $701,012,000 $1,970,286,000

Source: Actuary's report for the applicable year. Actuary's count of covered employees does not include 1,170 part-time and seasonal employees. This group has a de minimis impact on the valuation reports. 2 Source: Retirement System's audited annual report for the applicable year. The 2011 employer contribution includes an additional $3.7 million to fund the 2007 Early Retirement program. 3 Note: Unfunded actuarial liability as of 12/31/11 represents $728,430,000 for the pension liability and ($27,418,000) for the retiree health care liability.

INDUSTRY AND BUSINESS Metropolitan Area The City is located on the Ohio River in Southwestern Ohio near the junction of Ohio, Indiana and Kentucky. According to United States Census reports, 43% percent of the nation's population, 41% of the nation's purchasing power, 44% of the nation's manufacturing establishments, and 54% of the nation's value added by manufacturing is located within 600 miles of the City. The City's diverse economic base has been and continues to be a source of financial stability for the City. Among its prominent manufacturing groups are transportation equipment, which includes aircraft engines and auto parts; food and kindred products; metal working and general industrial machinery; chemicals; fabricated metal products; printing and publishing. Several Fortune 500 corporations are headquartered in the Cincinnati region, including Procter & Gamble, The Kroger Company, Macy's Inc., Ashland, Inc., Fifth Third Bancorp, Omnicare, American Financial Group and Western & Southern Financial. Over 300 Fortune 500 firms have operations in the Metropolitan Area.
Source: Greater Cincinnati Chamber of Commerce and Business Courier 2012 Book of Lists

A-12

Average employment (not seasonally adjusted) in the Cincinnati-Middletown Metropolitan Statistical Area* (the Cincinnati-Middletown MSA) totaled 1,017,900 for 2011, an increase of 6,000 since 2010.
Source: Bureau of Employment Services, State of Ohio

Twenty-Five Largest Employers in the Cincinnati-Middletown MSA

Name of Employer The Kroger Co. University of Cincinnati The Procter & Gamble Co. Children's Hospital Medical Center TriHealth Inc. Mercy Health Partners Archdiocese of Cincinnati GE Aviation St. Elizabeth Medical Center Fifth Third Bancorp Wal-Mart Stores UC Health Internal Revenue Service City of Cincinnati Hamilton County Frisch's Restaurants Inc. Cincinnati Public Schools U. S. Postal Service Christ Hospital Staffmark Miami University Fidelity Investments Kings Island Macy's

Nature of Business Consumer Goods Distribution Education Consumer Goods Distribution Health Care Health Care Health Care Education Aircraft Engines Health Care Financial Institution Discount Retailer Healthcare Federal Government City Government County Government Restaurant Education Postal Services Healthcare Temporary/Permanent Staffing Education Financial Services Amusement Park Department Store Education

Number of Employees 19,000 15,374 12,500 12,332 10,197 8,817 7,500 7,400 7,300 7,063 6,932 6,838 5,500 5,100 4,751 4,657 4,653 4,500 4,480 4,390 4,184 4,000 4,000 4,000 3,560

Boone County Schools

_______

Fortune 500 company with headquarters located in Greater Cincinnati. Source: Business Courier 2012 Book of Business Lists

The Cincinnati-Middletown MSA now includes Ohio Counties Brown, Butler, Clermont, Hamilton, and Warren; Indiana Counties Dearborn, Franklin, and Ohio; Kentucky Counties Boone, Bracken, Campbell, Gallatin, Grant, Kenton, and Pendleton, from 2006 to present.

A-13

Employment Statistics This table displays the number of workers in each of the major employment sectors. Cincinnati Middletown MSA Employment Statistics (In Thousands of Jobs)
Employment Sector Construction Manufacturing Transportation & Public Utilities Wholesale Trade Retail Trade Finance, Insurance & Real Estate Services** Government Total 2007 50 120 42 60 113 65 467 134 1051 2008 45 116 44 60 112 64 463 134 1038 2009 44 104 40 55 110 62 460 133 1008 2010 36 110 40 52 105 58 454 133 988 2011 37 113 37 58 104 59 462 130 1000 Change 07-11 (26.0%) (5.8%) (11.9%) (3.3%) (8.0%) (9.2%) (1.1%) (3.0%) (4.9%)

______ Employment numbers are not seasonally adjusted. Source: Bureau of Employment Services, State of Ohio **Services include: Educational and Health Care, Professional and Business, Leisure and Hospitality, Information, and Other Services

Cincinnati-Middletown MSA Employment Statistics (As a Percentage of Total Work Force)

Employment Sector 2007 Construction 4.8% Manufacturing 11.4% Transportation & Public Utilities 4.0% Wholesale Trade 5.7% Retail Trade 10.8% Finance, Insurance & Real Estate 6.2% Services** 44.4% Government 12.7% Total 100.00% 2008 4.3% 11.2% 4.2% 5.8% 10.8% 6.2% 44.6% 12.9% 100.00% 2009 4.4% 10.3% 4.0% 5.5% 10.9% 6.2% 45.6% 13.2% 100.00% 2010 3.6% 11.1% 4.0% 5.3% 10.6% 5.9% 46.0% 13.5% 100.00% 2011 3.7% 11.3% 3.7% 5.8% 10.4% 5.9% 46.2% 13.0% 100.00% Change 07-11 -1.1% -0.1% -0.3% 0.1% -0.4% -0.3% 1.8% 0.3%

______ Employment numbers are not seasonally adjusted. Source: Bureau of Employment Services, State of Ohio **Services include: Educational and Health Care, Professional and Business, Leisure and Hospitality, Information, and Other Services

A-14

Unemployment Statistics The following table lists the average annual seasonally adjusted unemployment rates for the State of Ohio and the United States. The average annual unemployment rates for the Cincinnati-Middletown MSA are not seasonally adjusted. The figures are expressed in percentages and represent the ratio of the total unemployed to the total labor force. 2007 5.00% 5.60% 4.60% 2008 5.80% 6.50% 5.80% 2009 9.30% 10.90% 10.00% 2010 9.70% 10.10% 9.60% 2011 8.60% 8.60% 8.90% Aug. 2012 6.80% 7.20% 8.10%

Cincinnati-Middletown MSA State of Ohio United States

As of August 2012, Hamilton County's unemployment rate of 6.8% was the third lowest unemployment rate among the six major urban counties in Ohio (Cuyahoga, Franklin, Hamilton, Lucas, Montgomery, and Summit).
Source: Ohio Bureau of Employment Services; Ohio Labor Market Information

Exports and Foreign Investment More than 1,000 Greater Cincinnati companies generated export sales of $15.5 billion. Cincinnati is the 15TH largest center of export sales in the United States. Major export products include jet engines, plastics, machinery, computer software, paper, and consumer goods. Foreign firms own more than 400 Greater Cincinnati businesses from Japan, Germany, the United Kingdom, France, India and Israel. Most of these subsidiaries have been established in the past decade. Foreign trade zone status is available in Greater Cincinnati to help firms engaged in international trade by lowering import duty and tax expenses. The two foreign trade zones cover Hamilton, Clermont, and Brown counties in Ohio and Kentucky's Boone County, near the airport.
Source: Greater Cincinnati Chamber of Commerce

Economic Development Cincinnati's Central Business District (CBD) is a regional office center and home to seven Fortune 500 companies and ten of the Fortune 1000. The CBD office market is adjusting to the addition of the Great American Tower at Queen City Square, a 800,000 square foot office building that opened in 2011. At the end of 2011, office vacancy rates reported by various commercial real estate brokerages ranged from 18-22 percent. Active Central Business District Developments Horseshoe Casino Cincinnati. Developer Rock Ohio Caesars Cincinnati, LLC officially broke ground February 4, 2011, on the $400 million, 354,000 square foot full-service casino in downtown Cincinnati which will also include a 2,500-space parking garage. With an anticipated opening in spring 2013, the project is expected to create approximately 2,000 temporary construction jobs and hiring is underway toward the projected 1,700 permanent casino operations jobs. The 24/7 entertainment complex is expected to draw an additional six million visitors annually downtown and generate up to approximately $17 million annually in gaming tax revenues to the City. Jimmy Buffets Margaritaville has been announced as the first commercial tenant in the casino. The project has the potential to generate in excess of $3 million annually in

A-15

net TIF revenue for the City which is being used for infrastructure improvements around the project site and in the surrounding downtown Cincinnati area. The Banks. In November 2007, the City of Cincinnati and Hamilton County approved a series of agreements to develop the city's central riverfront. This riverfront development will include a variety of residential options, entertainment venues riverfront offices, hospitality spaces, and an expansive 45-acre riverfront park. In addition to creating a destination where people can live, work, and play, the Banks will be a catalyst for regional economic growth. It will drive more than $600 million in private investment to our riverfront, provide a place to live for more than 3,000 residents and create hundreds of jobs during construction alone. The total development site is approximately 120 acres on Cincinnatis Central Riverfront. All phases of the project are anticipated to be completed by 2017. Phase 1 of the project is complete and the construction contracts have been closed out. Final reconciliation of expenses is currently in progress but Phase I was completed within budget. Phase 1 includes 300 apartments, (which are 100% leased with a waiting list) and 70,000 square feet of retail space (which is 84% leased). This private development sits on a podium of public parking, which along with new roads and utilities was completed by the City of Cincinnati and Hamilton County in 2011. As of October 2011 the public portion of Phase I work was completed and includes utility infrastructure improvements and an intermodal parking garage. The public parties phase 2 was complete as of Dec 2011. It includes the completion of utility work for the entire development area, relocating four blocks of Mehring Way to provide a contiguous site for the Riverfront Park, and constructing an additional one block extension to the intermodal parking structure. Those two stories of parking support the final block of Freedom Way, connecting Great American Ballpark and Paul Brown Stadium, and are designed to support the next phase of private investment. The John G. and Phyllis W. Smale Riverfront Park. The first phase of the park was opened in the Spring of 2012 and, in conjunction with on-going development of The Banks, the next phase of Smale Riverfront Park is under construction. At the completion of the second phase of the park in 2013, there will be gardens, a playground, and twelve acres of lawn, walking and biking paths connected to the Citys other parks east of downtown. The first phase of the park includes public art, numerous water features, a bike center, performance lawn, tree grove, and the Moerlein Lager House microbrewery and gastropod, which seats 500 people indoors and up to 600 in an outdoor beer garden. The restaurant employs 200 people. They will brew 5,000 barrels of Christian Moerlein beer at the Lager House annually and offer brewery tours. The City approved a 40-year lease with a Moerlein subsidiary and the $10 million restaurant opened for business early 2012. In addition, the City approved a Community Reinvestment Area Tax Exemption Agreement authorizing a real property tax exemption for a period of twelve years. Additional phases of the park are targeted to be constructed west of the Roebling Suspension Bridge. dunnhumbyUSA. dunnhumbyUSA an international leader in the field of market analysis and brand value for consumer goods and retail companies moved its national headquarters and 103 employees to Cincinnati in 2009. In February 2012, the company announced its intention to build a new 200,000 SF headquarters in downtown Cincinnati and the corner of Fifth and Race. The new office building will include a parking garage and additional commercial and retail space. The company anticipates that it will invest $36 million in the project and it will grow to 1,000 employees over the next five years. 550 of those 1,000 jobs will be new jobs. The City Council A-16

has extended the companys original Property Investment Reimbursement Agreement for an additional five years. This extension is appropriate given the companys intention to own, rather than lease, the space. The project is expected to break ground in fall 2012. 21c Hotel Redevelopment. 21c Museum Hotel is renovating and restoring the former Metropole apartment building to its original purpose as a hotel and a centerpiece of the Central Business District. Along with renovated guestrooms, current plans for the project include an expansion of public spaces on the first, second, and lower levels. The building will also feature completely new energy efficient HVAC, electrical, plumbing and life safety systems throughout the building. The Economic Development Division of the City of Cincinnati worked with Cincinnati Center City Development Corporation (3CDC) to package the redevelopment project and secured a commitment of City financing of up to $6.3 million for the $48 million project that is expected to open late 2012. Former Maisonette & Barleycorns. In May 2011, City Council approved plans to renovate two properties on Sixth Street east of Walnut Street, including the historic Maisonette building. Council authorized a Community Reinvestment Area Tax Exemption Agreement (CRA) with CBD Holdings, Inc., which will be overseeing the renovations and investment which are expected to be upward of $12 million. The former Barleycorns building is slated to become a bar and nightclub called Igbys, while the former home of the Maisonette will become the new location of Boca restaurant. The completed project will include a 13,000 square feet restaurant and 16,000 square feet of bar space, and is expected to create 139 temporary construction jobs, 80 full-time permanent jobs, and 85 part-time permanent jobs once construction is completed. The permanent jobs are expected to add about $2 million of additional payroll per year, with the temporary construction jobs expected to add approximately $4.7 million in additional payroll during the 12-month construction period. The new establishments are expected to open in late 2012/early 2013. Former Enquirer Building. The 246,160 square foot former Cincinnati Enquirer Building will be renovated by SREE Hotels into two distinct hotels. One hotel will be suitestyle and the other will be select service. Combined, the hotels will total 243 rooms. Total private investment in the project will be about $27 million. Construction is anticipated to begin in January 2013 and be open by the end of 2013. When complete, the historic building will be LEED certified, and will employ 35 full time equivalents. Active City-wide Major Developments Oakley Station. A 74-acre redevelopment of abandoned industrial space in one of the City's most rapidly appreciating neighborhoods, Oakley Station is anticipated to be an 855,000 square foot mixed-use development containing retail, entertainment, office and residential components. The total cost of the project is estimated to be $120 million. The developer anticipates that at full build-out, over 1,700 people will work on the site and the City estimates that those employees will generate nearly $800,000 in earnings tax each year. The City is assisting the project in three ways: 1) providing up to $9.9 million in tax increment financing for roadway improvements; 2) secured a $3.3 million in Clean Ohio grants for environmental remediation; 3) completing a major roadway improvement, the Kennedy Connector. In 2011, the developer completed above-grade environmental remediation and demolition. Work is underway towards completing the public roadway and utility improvements in 2013.

A-17

Procter & Gamble Winton Hills Campus. Procter and Gamble selected Cincinnati as the site for a new 1,000 employee logistics and planning center. The center is consolidating jobs from 40 P&G sites in North America. 350 jobs are being retained at the Winton Hills Campus and 650 jobs will be new to Cincinnati from either relocation or to be newly created. It is estimated that the jobs will pay an average of $34 an hour and completion of the consolidation is expected by the end of 2012. P&G will invest $20 million in renovation costs to house the logistics and planning center. The State of Ohio and the City of Cincinnati offered a JCTC for 10 years at 65% to have the consolidation take place here. Sites in Tennessee, Texas, Georgia, and North Carolina were also considered for the consolidation. Christ Hospital / Taft Offices, LLC. Taft Offices, LLC will invest an estimated $3,000,000 to renovate property including approximately 165,000 square feet of an existing professional office building at 217 and 237 William Howard Taft and construct 44,000 square feet of improved office space to LEED standards, 25,000 square feet of dedicated storage space, and approximately 700 parking spaces. Taft Offices, LLC received a LEED-CRA abatement from the City. Further, with the exception of a small amount of space occupied by the Tuberculosis Center, this was an otherwise vacant facility that will once again be put into productive use for the neighborhood. The primary tenant, The Christ Hospital, will occupy 126,000 square feet pursuant to a 14-year lease agreement and create fifty new jobs by 2015. Hamilton County will also lease approximately 13,000 square feet for the Tuberculosis Center. Cincinnati Childrens Hospital Medical Center. Construction on a new 1.4 million square foot research facility commenced in 2012. The project will give Childrens Hospital the largest pediatric research facility in the country. The new tower will cost $180 million, with no financial assistance from the City. The 15-story tower will add 425,000 square feet to the Burnet Avenue campus, creating enough space for Childrens to hire up to 100 new research facility over the next five years. The hospital plans to raise about $54 million from private donations and pay for the rest of the tower with operating earnings, reserves and investment income. The research tower is scheduled for completion by summer 2015. Expansion of Meyer Tool, Inc. Meyer Tool, Inc. will invest $2M in a new 30,000 sq.ft. facility at 3154 Spring Grove and expand its existing facility at 3055 Colerain Avenue in Camp Washington. The company will create 50 full time employees and retain 586 employees. The expansion will allow Meyer Tool, Inc. to handle increased work volume over the next few years. Completion of the expansion is scheduled for 2015. Rough Brothers, Inc. Rough Brothers, Inc. is a privately held company that designs, manufactures, and installs engineered greenhouses and related environmental systems and is in the process of significantly expanding its business. The company plans to construct a new 150,000 sq. ft. office and manufacturing facility to LEED standards at an estimated cost of $4.0 million. The new facility will be located at 1140 E. Regina Graeter Way in the Bond Hill neighborhood. The company will relocate 100 jobs and create 20 new highly skilled jobs to the City of Cincinnati. The project is expected to commence in 2013 or early 2014. Surgical Appliance Industries. Surgical Appliance Industries (SAI) is headquartered in the Oakley neighborhood and specializes in the production of orthopedic garments. The company has 121 employees and projects that it will create a minimum of 25 new jobs. It has invested $1.2 million in machinery and equipment. SAI chose Cincinnati over a facility it owns in Canada

A-18

to expand its TruForm Hosiery business. The State of Ohio and the City offered the company a JCTC for 5 years at 55% to expand here. Completed Central Business District Developments Phelps Conversion. Eagle Realty Group converted the Phelps building, located at 506 E. Fourth Street, into a Residence Inn by Marriot. A grand opening was held in April 2011. The new Residence Inn Cincinnati Downtown includes 134 residential-style bedrooms which addresses the needs of business travelers with separated workspace and internet access. The City of Cincinnati assisted in securing this project development by providing a CRA Tax Abatement. The Residence Inn Cincinnati Downtown is the first hotel to open downtown since 1984 when the Hyatt Regency opened its doors. Resource Ventures Ltd. Resource Ventures is a management consulting company based in Columbus that is investing $1,000,000 for expansion at 720 East Pete Rose Way. It anticipates that it will create 10 new jobs and retain 9 existing jobs at the project location. The City provided a Job Creation Tax Credit valued at a 45% rebate on all earnings taxes generated by the new jobs for a six year term. First Financial Bank. In 2011, First Financial Bank announced that it will establish its headquarters in downtown Cincinnati, which will add 150 new high-wage jobs to the tax base. The company will invest $4 million in the build out of its new headquarters by 2014. The City provided a loan in the amount of $774,450 and a net profits tax incentive to the company. City Council authorized the City Manager to execute a "Property Investment Reimbursement Agreement" to provide City funding for certain costs in the project. The City provided funding for the project in the form of (a) a loan in an amount equal to $774,450.00 and (b) annual PIR repayments, not to exceed $2,825,550.00 in the aggregate during a 12-year period, relating to new income tax revenues from new jobs created by the employer. Omnicare. Omnicare, Inc. is a Fortune 500 company that is the provider of professional pharmacy, related consulting and data management services for skilled nursing, assisted living and other institutional healthcare providers as well as for hospice patients in homecare and other settings." In 2011, the company announced that it is moving 484 employees to Cincinnati and, over the course of its new lease, will grow to 630 employees. The company will lease 150,000 square feet of office space. The average salary of each of these employees is just under $67,000. The companys decision to come to Cincinnati is based in part on the incentive packages offered by the State and City. The Nielson Company. In 2011, the Nielson Company announced that it is moving 600 employees to downtown Cincinnati. The City provided the company will passes for the Riverfront Parking Shuttle valued at $1,440,000, which will allow employees to park on the edge of downtown and ride Queen City Metros shuttle to work. Great American Tower at Queen City Square. Construction on this new 41 story office building and parking garage was completed, and the first tenants moved in during the first quarter of 2011. The building includes 800,000 square feet of office space, 25,000 square feet of street level retail space and a 1,700 space parking garage. It is the tallest building in the region and downtown Cincinnati's first LEED-certified office tower. American Financial Group, Inc is the anchor tenant, occupying two-thirds of the building. The third largest law firm in the city has also A-19

leased a substantial portion of the building. The City pledged TIF revenues from the project to pay the debt service on bonds issued by The Port of Greater Cincinnati Development Authority. The building is 90 percent leased. Commercial and Residential Development Beyond the Central Business District U-Square @ The Loop. This is an $80 million mixed-use redevelopment of 4.2 acres of vacant land located between McMillan and Calhoun Streets near the University of Cincinnati campus in the Clifton Heights neighborhood of the City. The USquare development will include approximately 161 market-rate apartments, approximately 40,000 sq. ft. of professional office space, and approximately 77,751 sq. ft. of retail space. The developer intends to reserve approximately 0.40 acres of the site for the future development of a hotel. The development will also include two City of Cincinnati owned parking garages as well as a public park-like plaza. The Citys contribution to the development is approximately $18.4 million in public improvements, which was financed with the issuance of bonds. Construction activity has already begun. The public parking garages are expected to be completed in February of 2013, followed by retail opening in March of 2013. The apartments are expected to be complete by summer 2013. Washington Park. The Washington Park project includes the renovation and expansion of the public park and the addition of a 500 space underground parking garage, which has transformed the park into a pivotal civic space in Over-the-Rhine, creating a more vibrant green oasis for residents and visitors in the middle of an urban neighborhood. The garage and the park are utilized by visitors to Music Hall, Memorial Hall, and the newly renovated School for Creative and Performing Arts, as well as visitors to the OTR Gateway Quarter shopping district and neighborhood residents. The Park renovation and expansion is estimated at $18 million and the garage construction is estimated at $29.3 million. The City provided $12 million for the garage construction. Washington Park re-opened in July 2012 and has already become a major driver of new economic activity in the blocks immediately surrounding it. Neighborhood Business Development. The Business Development Division of the Department of Community Development is responsible for facilitating private sector job creation and promoting investment in the commercial and industrial areas of the City's 52 neighborhoods. The division accomplishes this goal by providing small business services, proactive industrial redevelopment, and capital improvements in Neighborhood Business Districts and other commercial areas of the City of Cincinnati. Small Business Programs. The City funds various initiatives that are designed to assist established or emerging small businesses. The Citys model is primarily to contract with a network of nonprofit agencies that, in turn, administer small business programs and services on behalf of the City. The agencies provide training, coaching and networking events for small businesses. These non-profit organizations include, Smart Money Community Services, the Greater Cincinnati Microenterprise Initiative (GCMI), and Allied Construction Industries (ACI), and the Greater Cincinnati African American Chamber of Commerce (GCAACC). Current Neighborhood Business Development Activities Corryville Crossings. The first phase of a $24 million mixed-use construction project was completed in 2010 at the corner of Vine Street and Martin Luther King Jr. Drive in Corryville, across from the University of Cincinnati. A new Hampton Inn and Suites Hotel is now open at the site, as well as a 219 car public parking garage that was constructed using $4 A-20

million in TIF revenues. A final phase of the project will include three retail spaces on MLK Drive. Seymour/Reading Roads Corridor Eurostampa. Eurostampa North America (Eurostampa N.A.) completed construction of a new, $8 million 70,000 square foot modern commercial printing facility on a 6.8 acre site at 1440 Seymour Avenue in September 2011. The new facility is the company's North American headquarters and will serve their customers throughout the US, Mexico, and Canada. A few of their clients include names such as: Bacardi, Nutella, Bertolli, and Guinness. Eurostampa has a current employment of 75 and the company is projecting to employ a total of 79 people by the end of 2014. The company invested approximately $5 million into the new facility. Links Unlimited. Links Unlimited has completed a new 72,000 square foot LEED certified office and warehouse facility in the Roselawn neighborhood. The company has expanded and relocated from its previous home in Queensgate. Links Unlimited has invested $4 million in the project as well as retained 29 jobs and hired 20 new jobs. The State of Ohio and the City of Cincinnati provided Links Unlimited with a Job Creation Tax Credit on the new jobs. In addition, the City of Cincinnati approved a LEED CRA for the new building. Center Hill Commerce Park. The Center Hill Commerce Park is a new light industrial business park envisioned for the 60 acre former Center Hill landfill in the heart of Hamilton County. The project will result in 60 acres of previously unusable land, which will be used to attract up to 500,000 square feet of new light industrial or municipal space. The City has funded approximately $1.6 million in environmental assessment, asbestos abatement, demolition, and remediation, and has leveraged $2.4 million from other public sources to complete predevelopment activities. To alleviate geotechnical concerns at the site, the City has added fill to raise and compact the site. The appraisal is complete and the City is currently marketing the sites for end users. Madison Road Corridor Medpace, Inc. Medpace, Inc.,an international drug development services company that provides comprehensive clinical research support to the pharmaceutical industry, relocated their headquarters and 450 jobs to a new 150,000 square foot LEED certified office building in October 2010. During 2012, construction was completed on a new LEED certified 140,000 square-foot office building costing $7,500,000.00 and a new 60,000 square-foot research laboratory costing $3.6 million. They will employ approximately 1,339 workers occupying the entire 350,000 sq. ft space by the end of 2014. The former Kahn's/Sara Lee Former Kahn's/Sara Lee Redevelopment. Redevelopment project will renew approximately 17 acres of brownfield property into a new business park. The proposed plan would result in the construction of approximately 180,000 square feet of new light industrial/office/flex space with excellent transportation access and rail feasibility. In order to facilitate its redevelopment, the County and the Port of Greater Cincinnati Development Authority have secured a $3 million Clean Ohio Revitalization Fund grant to offset the $4 million cost of demolition, asbestos abatement, and environmental cleanup at the site. The City has committed to fund $400,000 of A-21

demolition costs to the ensure success of the project. Demolition and remediation of the site is complete. The owner is now working to obtain the Covenant Not to Sue on the site and has begun marketing the site to end users. Other Economic Development Providence North Redevelopment. The goal of the Providence North Redevelopment Project is to remove a hazardous source of soil and groundwater contamination and return approximately 2 acres of property to productive use by Samuel Adams Brewery Company (SABC). The improved efficiency of SABC's operations will help retain over 100 jobs. Over the past 4 years, SABC has invested over $1.8 million to purchase and assess the property with plans to expand its existing operation on the site. The total project cost is estimated at $4.1 million, with just over $3 million coming in the form of a Clean Ohio Revitalization Fund Grant for demolition, acquisition, and significant remediation. Demolition of above grade structures is complete. Soil remediation work is on schedule for completion in early 2013. The project is scheduled for completion by the end of 2013. American Can Redevelopment/Myron Johnson Redevelopment. This 8.5-acre brownfield redevelopment project is known as Factory Square, which is divided into two phases. Phase One was the $20 million rehabilitation of the Historic American Can Building in Cincinnatis Northside neighborhood into 110 Market-Rate, loft apartments and 12,000+ square feet of commercial space. The American Can Lofts are now open and 100% leased. Approximately 1/3 of the commercial space is leased, with continued interest from possible tenants. Phase Two is the redevelopment of the City-owned adjacent vacant land at the corner of Hamilton and Blue Rock. Demolition was completed in the spring of 2011 on the remaining buildings and foundations that remained on the former Myron Johnson Lumberyard property. Petroleum contamination was successfully remediated in the summer of 2011, giving the property a clean environmental bill of health. A sewer relocation project has been bid out to relocate a line that bifurcates the site. This will replace the deteriorating line and create large, square development parcels. Construction on the new sewer line was completed in 2012. The City issued a development RFP for the Myron Johnson site (2.5 acres) in 2012 and is currently reviewing proposals from developers. The City is hoping to negotiate a development agreement in 2013. In total, Factory Square involves $3.7 million in City funding and over $40 million in leveraged outside funding (projected). The City of Cincinnati committed $750,000 in Community Development Block Grant (CDBG) dollars to fund the ACB acquisition and portions of the environmental remediation costs. The City also contributed $1.4 million in Capital Funds to acquire Phase II land and another $500,000 for remediation/demolition activities related to the second phase. Other sources include: $1.6 million of federal Stimulus funds; $750,000 Clean Ohio Assistance Fund grant; $700,000 in Ohio Brownfield Cleanup Revolving Loan funds; $4,400,000 in Federal Historic Rehabilitation Tax Credits; and, $4,500,000 in Ohio Historic Tax Credits from the Ohio Department of Development (ODOD). The developers have contributed over $2 million and have nearly secured $15 million in private lending towards completing the project. Cincinnati Public Schools. In 2002, Cincinnati Public Schools launched a 10-year, $1billion Facilities Master Plan that is dramatically changing the look of CPS by providing new or renovated school buildings for all students, many of which will be LEED certified. As of January 2012, 37 school construction projects had been completed

A-22

Economic Development Tax Incentives Provided through the Department of Community Development (DCD). Property Investment Reimbursement Agreements. The City of Cincinnati may offer a PIRA to a company that is considering expanding in, or moving to, Cincinnati. The incentive is offered in consideration for new income tax revenue to the City resulting from jobs created by the company. The PIRA is a cash payment from the City designed to offset a portion of a company's net profits tax obligation. The payment is a percentage of either: the earnings tax generated from the net, new employees that are hired by the company, or the annualized cost of the capital investment. It does not require a match from the State of Ohio. Tax Incentive Districts. Ohio cities may create Tax Incentive Districts up to 300 acres in size. This provides Cincinnati with a tool to stimulate development and investment in depressed portions of the community. Twenty areas of Cincinnati have been approved as Tax Incentive Districts by Cincinnati's City Council. Community Reinvestment Area (CRA). DCD completed eleven commercial tax abatement agreements in 2010. These eleven projects are estimated to cost the City $2.6 million in exempted property taxes, with the companies committed to making a total of $83 million in private investments, adding 178 jobs and retaining 324 jobs. Income tax revenue from these jobs is projected at $2.95 million annually. In 2011, DCD completed fourteen commercial property tax abatement agreements. These fourteen projects are estimated to cost the City $1.5 million in exempted property taxes, with the companies committed to making a total of $47.8 million in private investments, creating 158 permanent jobs as well as 371 construction jobs. Income tax revenue from these jobs is projected at $1.35 million annually. Housing Programs and Development Villages at Roll Hill (formerly Fay Apartments). The City invested $3.1 million in HOME funds towards the renovation of 703 units of affordable housing. This will leverage an additional investment of $36.7 million. The renovation will be LEED certified and will include architectural features that will instill a greater sense of community at this location. Substantial security improvements are being made as well. In addition to construction funding, the project was also awarded a 12-year tax abatement by the City that is contingent upon the project receiving LEED certification. The tax exemption will reduce the tax liability associated with this new development by $5,112,770 over the life of the agreement. The project is currently under construction with an estimated completion date of December 2012, six months ahead of schedule. CiTiRAMA 2012. Virginia Place in Northside hosted CiTiRAMA 2012, in September 2012. This is the 11th home show and is the longest running partnership between an NAHB member and a municipality in the United States. The Show featured five single family homes. Only one month after the home show, already 25% of the buildable lots have been sold to builders who have customers ready to purchase new homes. The site is connected by a park trail to the Northwind development which offers a park-like setting with numerous natural amenities. Northwind. This new subdivision, to include 25 new energy star certified homes, is located in the community of Northside. The City provided infrastructure development. A-23

During its first year of development, nine homes have been purchased. The City's investment of $1.3 million leveraged $4.2 million of private investment. As of last quarter 2012, only 6 home sales are remaining to close out the development. Uptown Rental Properties Developments. Uptown Rental Properties has finished one major project in Clifton Heights and is currently constructing three more large housing and mixed-use new construction projects in and around the Short Vine Business District in the Corryville neighborhood. The new 65 West apartment housing development, completed on W. McMillan Street, represents approximately $17 million in private investment and approximately 130 apartments, all of which have been leased. Three more multi-unit apartment buildings, two of which will be placed above new retail space along Short Vine, represent over 200 new apartments, several thousand square feet of retail space, the complete redevelopment of nearly three city blocks, and approximately $30 million in total private investment. The Citys investment in these developments is largely in the form of real estate tax abatements. All three projects are under construction and are anticipated to open between 2012 and 2013. Incline Village. Incline Village is the first phase of Incline Square, a multiphased, mixed-use development located in the Incline District of the Cincinnati neighborhood of East Price Hill. Incline Village is a mixed-use project that consists of fifteen condominium units and a restaurant that is currently under construction. Each condominium unit ranges from 800-950 square-feet and is outfitted with upscale amenities and features outdoor space with panoramic views of the Cincinnati skyline. The 2,500 square-foot restaurant, expected to open fall of 2012 will feature indoor and outdoor seating and a large deck that will overlook downtown. The condominium units will open spring of 2012, with at least one unit already sold. Developers of Incline Village secured financing from the Center Bank of Milford and received a grant of $750,000 from the City of Cincinnati for the residential building costs. Total project costs are approximately $3 million. Mercer Commons Phase I. Mercer Commons Phase I was funded by the City in May 2012, includes the construction of a 340 space multi-story parking garage at 5 Mercer Street, approximately 4,000 sq. ft. of commercial space at 1324 Vine Street, 23 market rate residential condominium units (combination of rehabilitation and new construction), and 5 new market rate townhomes on Mercer Street. The total cost of the project is $25 million and sources of funds include an Ohio Department of Development Urban Redevelopment Loan, State and Federal Tax Credits, a Cincinnati Equity Fund Loan, and deferred Developer Fees. The Citys participation in the project is targeted toward the residential improvements and the City funding of $1.5 million (6% of project) will be provided as a grant to support the construction costs of the residential units. Price points for the residential units will range from $145,000 - $380,000. In addition to the construction financing, the City is also providing a 12-year tax exemption for the parking garage and commercial space. The proposed development continues the revitalization of the historic Over-the-Rhine neighborhood. Continuing the Citys focus on the Corryville Euclid Redevelopment. neighborhood, the City approved a loan of $460,000 for the renovation of 23 rental units at 2719-21 Euclid Avenue. Located one block from the Universitys investment in Turner Hall, one block from the Countys investment in the public library, and one block from the Corryville Community Center and Park, Euclid Redevelopment is at the heart of activity in the neighborhood. The total project cost is $2 million and was fully leased in A-24

August and September 2012. Columbia Place Apartments. The Partnership between Al. Neyer, Inc. and Towne Properties, Inc. is to develop a 76-unit new construction, Market-Rate, LEED-Certified apartment community. The City is investing $1.3 million for this development which will be located at the northwest corner of Delta Avenue and Columbia Parkway in Columbia Tusculum. Construction will begin in summer 2012 with estimated completion date of June 2013, North Rhine Heights. The Partnership between North Rhine Heights LLP and Over-the-Rhine Community Housing (OTRCH) is an effort to rehabilitate 13 properties located in the northern portion of Over-the-Rhine. North Rhine Heights is the first phase of a larger redevelopment strategy designed to deal with the elevated vacancy levels that exist in older Low Income Housing Tax Credit (LIHTC) properties in Over-the-Rhine. The City is investing $1,850,420 resulting in 65 units of fully renovated affordable housing to be completed by December 2012. The Reserve at 4th and Race. This project includes a complete renovation and conversion of the property located at 105 West Fourth Street from 16 floors of office space to 5 floors of office (approximately 59,415 square feet) and 11 floors of residential market rate apartments. The building was 78% vacant at the start of the project. Upon completion of the rehabilitation a total of 88 high-end units will be available. Existing commercial tenants will occupy the newly renovated commercial space. The total project cost is approximately $17.7 million and the City is providing $908,927. The project is currently under construction with a November 2012 completion date. Alston Park. The Alston Park project consists of the total rehabilitation of two multi-family buildings that are currently vacant and are a blight in the Avondale neighborhood. When complete, Alston Park will consist of 39 housing units (34 two bedrooms and 5 three bedrooms). The building originally contained 66 units; however taking into account the wishes of the neighborhood and long-term project viability, the developers have decided to demo some of the units and incorporate the square footage into the redesigned 39 units. The units have been designed with amenities that will enhance quality of life for the tenants including: high speed internet wiring, washer and dryer hookups, garbage disposals, and programmable thermostats. The project will be LEED certified and has been approved for a 12 year tax abatement. The total project cost is $7,142,778 and the City has provided a loan of $200,000 in HOME funds along with the tax abatement. Other funding sources for this project include funding from the Low Income Housing Tax Credit (LIHTC) program and Neighborhood Stabilization Program (NSP) funds from the State. The project will start construction in November 2012 with a February 2014 completion date. Haddon Hall. The Haddon Hall project is the rehabilitation of a 114 unit senior housing project in Avondale. The project is currently 90%+ occupied. This project is a moderate rehabilitation effort that will include site work (repair/replace retaining wall(s), ADA compliant features on entry stairs and ramps, replacement of perimeter fencing); Exterior (replace shingle roof, repair flat roof, partial tuck pointing, replacement windows (approved by historic) upgrade existing surveillance system, and exterior painting); Common area building interior (paint common areas, repair doors); Living Units (new doors, new flooring, new kitchen cabinets, new appliances, new bathroom vanity sinks and bath accessories, reconfigure four of the units into handicap accessible units. The A-25

total project cost is $12,127,444 and the City has provided a loan of $200,000 in HOME funds. Other funding sources for this project include HUD Bond financing, LIHTC funds, and a HOME loan from the State of Ohio. The project has a projected completion date of February 2014. Abigail Apartments. Abigail Apartments will consist of the full rehabilitation of a 71 units. This is a scattered site project with approximately 18 addresses located in the West End. The proposed rehabilitation will include the following: majority of units stripped to original studs, new mechanicals, electric and plumbing systems, new hardwood floors, ceramic tile kitchens and bathroom floors, high efficiency HVAC systems, replacement of all doors and windows, new kitchens including cabinetry and appliances. The total project cost is $14,088,325 and the City has provided a loan of $550,000 in HOME funds. Other funding sources for this project include NSP funding from the State of Ohio, LIHTC proceeds and debt financing. Building Permits. For 2011, the City issued a total of 9,291 permits for all construction, including new construction and construction on existing residential and non-residential property, with an estimated cost of $536,046,935. This represents a 9.8% decrease from the estimated cost for building permits in 2010. Schedule of Total Building Permits (2007-2011) Year 2007 2008 2009 2010 2011 Number of Permits 8,780 8,429 8,139 8,958 9,291 Estimated Cost 487,176,433 555,648,279 603,416,690 594,198,935 536,046,935

Building Permits New Construction Only

RESIDENTIAL # of Permits Estimated Cost 150 72 44 85 87 36,540,275 13,252,764 10,642,279 14,304,051 18,809,842 NON-RESIDENTIAL # of Permits Estimated Cost 55 66 60 76 46 124,961,042 243,388,482 264,896,214 217,069,234 135,911,169 TOTAL # of Permits 205 138 104 161 133 Estimated Cost 161,501,317 296,641,246 275,538,493 257,642,973 154,721,011

Year 2007 2008 2009 2010 2011

In 2011, the estimated valuation of new residential projects realized a decrease of 37% from 2010. However, the City of Cincinnati had an increase of 32% in estimate cost for new residential projects. The Casino Development (parking garage), University Edge Cincinnati (student housing), Good Samaritan and Childrens Hospital were a few of the major construction projects issued in 2011.

A-26

Transportation Airports The Cincinnati/Northern Kentucky International Airport CVG. Located in Northern Kentucky and owned by Kenton County, Kentucky, is the region's principal airport. CVG has been recognized as the Best Regional Airport in North America and as the top-ranked airport for its "Staff Service Excellence" by Skytrax, a London-based air transport research organization. The airport is located 13 miles (15 minutes) south of downtown in Northern Kentucky, and offers approximately 170 daily departures to 52 cities worldwide, including nonstop service to Montreal, Toronto, Paris, and Cancun. Airlines serving the area include: Air Canada, American, Continental, Delta, Frontier, United and US Airways. Lunken Airport. A 1,000 acre facility, located on the City's east side, has been owned and operated by the City of Cincinnati since 1930. Lunken serves many major corporations as well as local small businesses, private pilots, and medical and military flights. Lunken Airport handled approximately 70,000 flights in fiscal year 2011 with the majority serving the business community. Approximately 200 acres of the property is operated as a City golf course. Railroads. The Greater Cincinnati area is served by four major railroad systems - Amtrak, CSX, Norfolk Southern, and Conrail, serving Southeast Indiana and Southwest Ohio. There are more than 175 miles of mainline tracks. The Queensgate computerized train yard is one of the most modern and efficient facilities serving the U.S. These railroads cover 64,000 total miles of track, about 20% of the nation's total. These railroads reach 30% of the nation's population, linking Cincinnati directly with 27 states east of the Rocky Mountains, the District of Columbia, and two provinces in Canada.
Source: Greater Cincinnati Chamber of Commerce

Port of Cincinnati. The Ohio River is one of Greater Cincinnati's most important transportation assets. The Port of Cincinnati, the fifth largest inland port, is home to two major barge companies, and has links to 140 other barge lines, shipping mainly coal and coke, petroleum, aggregates, grains, chemicals and chemical fertilizers, minerals, iron ore, iron, and steel. More than 12 million tons destined to, from or within Cincinnati pass through the Port annually. Passenger carriers on the Ohio River include B&B Riverboats, Celebrations, River City, Satisfaction II, and Queen City Riverboat Cruises. In addition to barge lines serving the area, nine public river terminals are located along the thirty-mile shoreline of the Port of Cincinnati. The Port of Cincinnati provides warehouse facilities, open storage, land, tanks, silos, and cranes among other support facilities and services.
Source: Greater Cincinnati Chamber of Commerce

[Remainder of page intentionally left blank]

A-27

Public Transit. Following approval in 1973 of a municipal income tax increase for public transit purposes (0.3%), the City acquired ownership of the transit system, whose operations were turned over to the Southwest Ohio Regional Transit Authority (SORTA) to operate. The City-SORTA agreement sets forth the contractual relationship between the two political entities. SORTA, a political subdivision of the State of Ohio, operates two public transportation services: Metro local and express transit service and Access paratransit service for people whose disabilities prevent their use of Metro. SORTA's current base fare is $1.75 within the City of Cincinnati, with higher fares outside the City. SORTA provides about 17 million rides a year. The Greyhound Bus line offers daily arrivals and departures for interstate travel. The Transit Authority of Northern Kentucky carries approximately 3.0 million passengers annually. The Megabus Bus line offers trips to Columbus, Chicago and Indianapolis from Cincinnati for a one way starting price of $1. Trucking. All major markets are easily reached from Greater Cincinnati via interstate. Twenty major metro areas within 400 miles are served by one-day truck driving time and 30 additional markets by second day service. More than 900 interstate common freight carriers service the region. There are three interstate expressways linking Cincinnati with the nation: I-75, I-71, I-74 and I-275 links the tristate area of Southwestern Ohio, Northern Kentucky and Southeastern Indiana. Mass Media The Cincinnati area has one daily newspaper with a general weekly circulation of over 580,500, as well as over twenty-six community and special interest newspapers. Eleven television stations and twenty two radio stations complement the area's communication capabilities. Cultural Opportunities Cincinnati offers a variety of cultural options. The century-old Music Hall, world-renowned for its outstanding acoustics, is the home of the Cincinnati Symphony Orchestra, the May Festival, and the Cincinnati Opera. It also affords a stage for the University of Cincinnati College Conservatory of Music and the Cincinnati Ballet Company. Other venues include the Corbett Center for the Performing Arts, the Playhouse in the Park, the Aronoff Center for the Arts, and the Showboat Majestic. The City is home to numerous museums including: the Cincinnati Art Museum, the Contemporary Arts Center, the Taft Museum, the John Hauck House, the National Underground Railroad Freedom Center, the Reds Hall of Fame Museum and the Cincinnati Fire Museum. The Cincinnati Museum Center at Union Terminal includes the Museum of Natural History and Science, the Duke Energy Children's Museum, the Cincinnati History Museum, and the Omnimax Theater. Cincinnati participates in a county-wide library system. The Public Library of Cincinnati and Hamilton County with 40 branches consistently ranks among the top ten cities in the nation in per capita circulation, with a collection of nearly 9 million items. In 2011, total circulation of books, print, and audio-visual materials exceeded 17.6 million. Nearly 1.7 million questions were answered and more than 17,500 free programs were offered. Wi-Fi service is available at all 41 locations.

A-28

Higher Education The table below provides a listing of the area's largest colleges and universities by enrollment as of fall term 2011. Total Enrollment
42,750 22,493 15,850 10,500 6,945 5,000 3,500 1,832 1,500 1,272

Higher Education Institutions

University of Cincinnati Miami University Northern Kentucky University Cincinnati State Technical & Community College Xavier University Gateway Community and Technical College Ivy Tech Community College Southeast Thomas More College Beckfield College College of Mount St. Joseph

_______
Source: Business Courier 2012 Book of Lists

The region's largest college, the University of Cincinnati, has significant research and contract activity. During the 2008-2009, 2009-2010, and 2010-2011 fiscal years, the University of Cincinnati and its affiliates received $378 million, $443 million, and $418 million respectively, in federal, state, city/county, and non-government agency grants, contracts, and awards. According to the National Science Foundation ranking for federal funding of major research UC stands among the top 50 research universities in the nation. Primary and Secondary Education Cincinnati Public Schools (CPS) provides a quality education to about 33,748 students in preschool through 12th grade. The district operates 14 high schools, 39 elementary schools, 3 combination schools (K-12) and is the largest public school system in the Tristate area. It offers 19 magnet elementary schools with nine programs, some with special teaching focuses such as Montessori and Paideia, others with curriculum focuses such as foreign language and the arts. The district's high schools offer specialfocus programs to lead students to graduation and into careers and higher education. The district is nationally recognized for its Montessori schools (CPS opened the nation's first public Montessori elementary school and high school); for Walnut Hills High School, a top-rated classic college-preparatory school; and the School for Creative and Performing Arts (SCPA). Under the district's 10-year Facilities Master Plan, buildings throughout the district are being fully renovated or replaced with new construction, providing all students with first-class learning environments. Thirty-four projects have been completed so far. Covering 19 counties in southwestern Ohio, the Archdiocese of Cincinnati has the 8th largest network of Catholic schools in the U.S with a total enrollment of approximately 43,263 students. Within the Greater Cincinnati area, there are 18 Catholic high schools and 68 Catholic elementary schools that offer education from preschool through eighth grade. These 86 Catholic schools in the Greater Cincinnati area have a total enrollment of approximately 33,083, which is 76% of the total students in the entire Cincinnati Archdiocese.

A-29

Greater Cincinnati Recreation Facilities Major Greater Cincinnati recreational attractions include Kings Island Amusement Park, Jack Nicklaus Sports Center, Coney Island, The Beach, Krohn Conservatory, Cincinnati Zoo, Perfect North Slopes, Newport Aquarium, OMNIMAX Theater at the Museum Center, Hollywood Casino, Belterra Casino, and Grand Victoria Casino. Sports Professional sports teams that call Cincinnati home include the Cincinnati Reds (Major League Baseball), Cincinnati Bengals (National Football League), Cincinnati Commandos (Continental Indoor Football League), Cincinnati Kings (United Soccer Leagues Premier Development League), Cincinnati Cyclones (East-Coast Hockey League), and Cincinnati Rollergirls ( Women's Flat Track Derby Association). Sports facilities include Great American Ball Park, Paul Brown Stadium, The U.S. Bank Arena, Cincinnati Gardens, the University of Cincinnati's basketball fieldhouse (Fifth Third Arena at Shoemaker Center) and football stadium (Nippert Stadium), and Xavier University's basketball fieldhouse (Cintas Center). Other sports events in the area include horse racing at Turfway Park, River Downs, and Lebanon Raceway; Indy car and NASCAR racing at the Kentucky Speedway; the Cincinnati Flying Pig Marathon; and Professional Volleyball at the AVP Crocs Tour Cincinnati Open. Major tennis events include the Western & Southern Masters and Women's Open Tennis Championships. Utilities Electric Power/Gas. Cincinnati is served by Duke Energy. Duke Energy's Midwest operations supply power to 1.6 million electric customers and 500,000 natural gas customers in Ohio, Kentucky and Indiana. Duke Energy is a diversified energy company with a portfolio of natural gas and electric businesses, both regulated and unregulated, and an affiliated real estate company. Duke Energy supplies, delivers and processes energy for customers in the Americas. Telephone. Cincinnati Bell provides telecommunications services and advanced voice, data, Internet, wireless, and entertainment services to business and residential customers in a three-state area that comprises portions of southwestern Ohio, southeastern Indiana, and northern Kentucky covering more than 2,400 square miles. Five-Year Capital Improvement Plan The City has an estimated five-year General Capital Improvement Plan that is balanced. The estimated budget and the portion estimated to be supported by general obligation property tax supported debt is outlined in the table below: Capital Improvement Plan (000's)
2012 CIP Budget Property Tax Supported Debt % Debt $55,500 $18,000 32% 2013 $50,860 $15,000 29% 2014 $51,235 $15,000 29% 2015 $51,610 $15,000 29% 2016 $50,350 $15,000 30% Total $259,555 $78,000 30%

A-30

Convention Facilities Authority for Hamilton County, Ohio Convention Facilities Authority Revenue Bonds The dedicated Transient Occupancy Tax (City) and Lodging Excise Tax (County) is expected to cover the debt service for the first lien ($70.1 million) and second lien ($35.9 million) debt. Pursuant to a Memorandum of Understanding between the City, Hamilton County and the Convention Facilities Authority (CFA), the City has agreed to guarantee, subject to annual appropriation, the principal and interest on subordinate debt. A debt service reserve equal to the maximum annual debt service of $2,309,250 has been appropriated from tax increment revenue in the City's Convention Center Expansion Fund. On August 30, 2007 the CFA purchased $11,914,500 in defeasance obligations resulting in a defeasance of Second Lien Improvement Bonds. Securities will be held in an Escrow Trust Agreement with the Bank of New York with various maturity dates through 2014. (See "DESCRIPTION OF THE CITY Major Municipal Services Provided Enterprise Services Duke Energy Convention Center" for further description). Urban Redevelopment Bonds The City issued $30 million of qualified redevelopment general obligation bonds in July 1987, for use in assemblage of the redevelopment parcel known as Fountain Square West. The City had entered into a long-term lease agreement in December 1986, with a redeveloper, who pledged to pay early debt service requirements until payments in lieu of taxes occurred. In September 1988, the redeveloper defaulted and the performance bond of $1.1 million was retained by the City and used to meet debt service requirements in 1988. Each year the City has appropriated and paid the debt service. In 2007, 2008, 2009, 2010, and 2011 City Council appropriated $1.9, $1.8, $1.7, $1.6, and $1.6 million, respectively, to meet the net annual debt service requirements. The debt service due for 2012 is $1.5 million. The appropriations were made from the 0.15% portion of the Municipal Income Tax. The City expects to continue to finance the required annual debt service. As of December 31, 2011 the balance on these bonds was $6 million. DEBT STRUCTURE Unlimited Tax The City is unique in the State of Ohio because it has the right to levy property taxes without limitation and without a vote of the electorate to support its lawfully issued general obligation bonds and notes. In September 1977, the Supreme Court of Ohio dismissed an appeal from the decision of the Court of Appeals, First Appellate District, Hamilton County, Ohio, involving the City's debt limitations. In summary, the City instituted a test case against the Director of Finance for the purpose of obtaining a definitive construction of certain sections of the City Charter bearing on the right of the City to levy taxes in excess of the ten-mill limitation of Section 5705.02 of the Ohio Revised Code. The case was decided in the City's favor. Thus, the City's ability to incur debt is limited only by the arithmetical (percentage) limitations set forth under "Applicable Debt Limitations," contained later in this section. General obligation bonds of the City are lawfully issued in accordance with Article VIII, Section 4, of the City Charter which provides for the levy of ad valorem taxes on all property in the City subject to ad valorem taxes for principal and interest unless paid from other sources. The taxes to be levied by the City are without limitation as to rate and amount; however, all bonds issued by the City are subject to the provisions of Chapter 9 of the Federal Bankruptcy Act and other laws affecting creditors' rights. The 2012A Bonds described herein are lawfully issued in accordance with the Constitution and general laws of the State of Ohio and the City Charter. A-31

The table on the following page provides a summary of the City's debt after the sale of the 2012D-F Bonds. Outstanding bonds and notes after the sale of the 2012D-F Bonds will total $1,148,835,000*, of which $543,415,000* are General Obligation. Bonds and Notes Authorized, Outstanding and Unissued The General Obligation Bonds and Notes Outstanding following the delivery of the 2012D-F Bonds will be $543,415,000.* [Remainder of page intentionally left blank]

*Preliminary, subject to change

A-32

A-33

Net General Tax Supported Bonds The following Statement of Net General Tax Supported Bonded Indebtedness reflects the total gross debt outstanding from both voted and unvoted issued bonds and notes. Certain bonds are selfsupporting from their respective revenue sources. Revenue sources have been, and are expected to be, sufficient to pay principal and interest on all self-supported debt. Net General Tax Supported Debt represents the outstanding debt serviced exclusively by real and personal property ad valorem taxes. Statement of Net General Tax Supported Bonded Indebtedness after Bond Sale (Including the Series 2012D-F Bonds Described Herein)*
Voted General Obligation Bonds Unvoted General Obligation Bonds and Notes Revenue Bonds Gross Outstanding Indebtedness LESS Total Self-Supporting and Revenue Debt (Not Serviced From Property Taxes) Bond Retirement Unreserved Fund Balance as of 10/1/2012 Total Deductions Net General Tax Supported Debt (Equal to Gross Outstanding Indebtedness less Total Deductions) $ 0 543,415,000 605,420,000 $1,148,835,000

$890,350,000 (60,595,526) $829,754,474 $319,080,526

Applicable Debt Limitations Section 133.05 of the Ohio Revised Code provides that the principal amount of both voted and un-voted debt of the City may not exceed 10-1/2% of the City's assessed valuation and the principal amount of the City's unvoted debt may not exceed 5-1/2% of the City's assessed valuation. These limitations have been increased several times in the past. There are exemptions of certain debt from the 5-1/2% and 10-1/2% limitations listed in Ohio Revised Code Section 133.05. The kinds of debt that are exempt include debt issued for water works, voted urban redevelopment bonds not exceeding two percent of total assessed property valuation, debt covenanted by appropriations annually from lawfully available municipal income taxes, recreational facilities, off-street parking and urban redevelopment, as well as debt (not heretofore incurred by the City) for certain other purposes. The following table reflects the status of the statutory limitations as of October 1, 2012 which includes new bonds to be issued. It includes outstanding debt of $1,148,835,000.* [Remainder of page intentionally left blank]

*Preliminary, subject to change.

A-34

Statutory Debt Limitation Worksheet

Assessed Valuation Overall Debt Limitation- 10-1/2% of Assessed Valuation Gross Indebtedness Less: Debt Outside Limitations: Self-Supporting and Revenue Debt Urban Redevelopment Bonds Voted Debt within 10-1/2% Limitation Legal Debt Margin within 10-1/2% Limitation Unvoted Debt Limitation 5-1/2% of Assessed Valuation Gross Indebtedness Less Debt Outside Limitations: Water Works Bonds Recreational Facilities Bonds & Notes Municipal Income Tax Supported Bonds and Notes Metropolitan Sewer District Bonds Police & Fire Pension Refunding Bonds Stormwater Management Bonds Urban Development Bonds Taxable Urban Redevelopment Bonds Urban Renewal/Economic Development Bonds and Notes Economic Development Bonds - Taxable Economic Development Revenue Bonds and Notes Taxable Economic Development Revenue Bonds and Notes-Tax-Exempt Water System Revenue Bonds Debt Within 5-1/2% Limitation Legal Debt Margin Within 5-1/2% Limitation $5,343,335,120 561,050,188 $1,148,835,000 $890,350,000 0

890,350,000 258,485,000 $302,565,188 $326,403,633 $1,148,835,000

$5,800,000 7,225,000 90,870,000 13,900,000 38,730,000 2,700,000 4,650,000 6,620,000 87,645,000 26,790,000 27,810,000 68,745,000 508,865,000

890,350,000 258,485,000 $67,918,633

[Remainder of page intentionally left blank]

A-35

Overlapping Debt
2012 Estimated Assessed Valuation (a) City of Cincinnati Overlapping: Board of Education Cincinnati City School District Hamilton County Total $5,353,335,120 Net General Tax Supported Debt $318,080,526 694,540,000(b) Net Tax Percent Overlapping 100% Supported Overall Debt $319,080,526

6,029,948,550

89%

618,140,600

18,248,919,290

87,872,188(a) $1,101,492,714

30%

26,361,656 $963,582,782

_______
(a) (b)

Source: Hamilton County Auditor's Office, December 31, 2011 data. Source: Cincinnati City School District, December 31, 2011 data.

The Cincinnati City School District and the County of Hamilton are separate political subdivisions with operating and debt service funding separate from that of the City. The Board of Education of the Cincinnati City School District cannot incur more than one-tenth of one percent of its assessed valuation as general obligation debt without majority approval by the voters. The Board of Education may request voter approval of general obligation debt not in excess of nine percent of the assessed valuation of the School District (unless it is certified as a "special needs district"). Under State law, before seeking voter approval, the Board of Education is required, where applicable, to receive the consent of the Ohio Department of Taxation and the State Superintendent of Public Instruction in accordance with policies adopted by the State Board of Education. The Board of County Commissioners of the County of Hamilton cannot incur unvoted general obligation debt in excess of one percent of its assessed valuation, which debt must be included with voted county debt against an overall county debt limitation of three percent of the first one hundred million dollars of its assessed valuation, plus one and one-half percent of the next two hundred million dollars, plus two and one-half percent of all in excess of three hundred million dollars. However, the Board of County Commissioners may authorize general obligation revenue or special assessment supported bonds for utilities and certain other purposes, which are exempt from un-voted debt limitations to the extent net revenues or assessments service such general obligation bonds. Bond Retirement Fund By annual resolution, City Council authorizes the property tax rate required to be levied to service the expenses related to administration of the Bond Retirement Fund, including the payment of principal and interest on certain City bonded indebtedness. Historically, revenues of the Bond Retirement Fund have been sufficient to service all of the City's general obligation indebtedness. Besides property taxes, these revenues have included: proportionately shared state taxes, property tax rollback reimbursement, income earned from temporary investment of fund balances, and rental income from Cincinnati Southern Railway property. In addition to the information contained in the "Notes to Financial Statements," the following information is provided to describe the application and utilization of rentals received from Cincinnati Southern Railway. A-36

The rental income received from Cincinnati Southern Railway property is deposited into the Bond Retirement Fund to be applied to the bonded debt of the City as provided by legislation enacted by the Ohio General Assembly on July 1, 1949. The lease agreement with the Norfolk Southern Corporation was modified in 1987 to provide for an annual rent payment of at least $11 million plus an annual escalator based on the Implicit Price Deflator of the Gross National Product index of the U.S. Department of Commerce. Annual adjustments are not to exceed four percent. The rental revenues are used for debt service on general obligation notes issued periodically for various purposes and other bonded debt. The amounts received by the Bond Retirement Fund under the lease agreement for the years 2007 through 2011are presented below: Southern Railway Revenue Year 2007 2008 2009 2010 2011 Amount 18,317,889 18,889,407 19,323,674 19,551,307 19,709,868

The City maintains a balance in the Bond Retirement Fund in order to assure that funds are available to meet debt service payments when due. The amount available in the Bond Retirement Fund as of October 1, 2012 is $60,595,526. Any excess premium and accrued interest received from the sale of bonds is deposited in the Bond Retirement Fund to be applied to the payment of principal and interest. Revenue Debt Pay-Out Ratio (Including the Series 2012D-F Bonds Described Herein)* After the Series 2012D-F Bonds are issued, the outstanding General Obligation debt will be $543,412,000. During 2012, $42,345,000 more in principal will be paid, leaving a December 31, 2012 balance of $501,070,000. Of the $543,415,000, 51% will be retired by December 31, 2017; 73% will be retired by December 31, 2022; 89% will be retired by December 31, 2027; and the balance will be retired by December 31, 2036. [Remainder of page intentionally left blank]

*Preliminary, subject to change.

A-37

______ *Information in the above table is preliminary and subject to change.

A-38

Debt Summary (General Obligation and Revenue Debt)

2012(est.) Total Debt Population* Total Assessed Valuation Debt Per Capita (Est.) Percent of Total Debt to Assessed Valuation Total Value of Property (Est.) Percent of Total Debt to True Value $1,086,180,000 296,943 $5,343,335,120 $3,658 20%
$14,717,676,775

2011 $990,025,000 296,943 $5,827,536,160 $3,334 17%

$16,131,202,167

2010 $922,265,000 332,458 $5,940,113,290 $2,774 16%

$16,486,235,333

2009 $909,680,000 332,458 $5,934,611,500 $2,736 15%

$16,509,153,786

2008 $797,015,000 332,458 $5,965,707,310 $2,397 13%

$16,771,404,728

7.38%

6.14%

5.59%

5.51%

4.75%

[Remainder of page intentionally left blank]

A-39

Outstanding Bonds and Notes as of December 31, 2012 (Includes the Series 2012 Bonds Described Herein)*

__________ (1) Supported by General Tax Levy. (2) Supported by Municipal Income Tax, but property tax support pledged taxable. (3) Supported by current revenue, but property tax pledged. (4) Supported by current revenue, but property tax support pledged taxable. (5) Supported by current revenue, no tax support pledged. (6) Supported by current revenue, no tax support pledged & taxable.

Preliminary; subject to change.

A-40

Ad Valorem Tax Base The assessed valuation of property within the City subject to levy of ad valorem taxes for the past five years is shown in "Table - Assessed Valuation." The assessed property includes real property, public utilities property, and tangible personal property with real property further subdivided into primarily residential, commercial, and industrial valuations. The City has used property tax abatement to a limited extent to encourage development. Real Property. Real property experienced a statutory sexennial reappraisal in 2011. Overall assessed valuation decreased 7.5%. The laws of the State of Ohio presently require that the County Auditor reassess real property at any time such official finds that the true or taxable value thereof has changed, and in the third calendar year following the year in which a sexennial reappraisal is completed if ordered by the Ohio Commissioner of Taxation. In general, real property taxes collected in any calendar year are those levied on assessed values as of January 1 of the preceding year. Existing law requires that taxable real property be assessed at not more than 35% of its true value except that taxable real property devoted exclusively to agricultural use is to be assessed at no more than 35% of its current agricultural use value as determined by the County Auditor in accordance with rules adopted by the Ohio Commissioner of Taxation. Forestry or timber growing real property may be taxed at 50% of the local tax rate upon its true value. Real property taxes for public utilities are those levied on assessed values as of December 31 of the preceding year. Public Utilities. Tangible personal property of public utilities is assessed at various rates (25% to 88% of true value) depending upon the type of property. Effective for collection year 2002, the assessed valuation of electric utility production equipment was reduced from 100% and natural gas utility property from 88% of true value, both to 25% of true value. Makeup payments in varying and declining amounts were to be made through 2016 to taxing subdivisions such as the City by the State from State resources. The State's 2005 biennial budget bill included a reduction in the 88% assessment rate for electric utility transmission and distribution equipment to 85%, and a reduction in the 25% assessment rate for all electric company taxable property to 24% commencing in tax year 2006. That legislation also provides for a phasing out of the taxation of all personal property used by telephone companies, telegraph companies, or interchange telecommunications companies by tax year 2011, with State reimbursement payments to be made in declining amounts through 2018. In the States 2012 budget public utility personal property tax reimbursements for normal operating expenses paid to the general fund were eliminated effective July 2011. The State reimbursements for debt service will continue through 2016 at a fixed amount. Tangible Personal Property. House Bill 66 passed June 30, 2005, phased out the taxation of all tangible personal property used in business over four years beginning in 2006 and ending in 2009, when all such property became exempted from taxation. The phase out applied to most businesses and includes furniture and fixtures, machinery and equipment, and inventory. To compensate for foregone revenue due to the phase out of the tangible personal property tax, the State made distributions to taxing subdivisions (such as the City) from revenue generated by a commercial activity tax. Generally, these distributions were expected to fully compensate taxing subdivisions for such tax revenue losses through 2010, with gradual reductions in the reimbursement amount from 2011 through 2017. In the States 2012 budget the tangible personal property tax reimbursements for normal operating expenses paid to the general fund were eliminated. The States reimbursements for debt service will continue through 2017 at a fixed amount.

A-41

Assessed Valuation
Collection Year 2007 2008 2009 2010 2011 2012 Real Property* $5,522,872,120 5,523,140,570 5,647,647,630 5,653,703,070 5,548,127,850 5,047,722,430 Public Utility Property $312,711,570 259,754,620 258,279,260 270,947,630 279,408,310 295,612,690 Tangible Personal Property $337,541,870 182,812,120 28,684,610 15,462,590 0 0 Total

$6,173,125,560 $5,965,707,310 $5,934,611,500 $5,940,113,290 $5,827,536,160 $5,343,335,120

_______ * Analysis of Real Property Assessed Valuation by Type of Property (See below)

Real Property Assessed Valuation (By Type of Property)

Collection Year 2007 2008 2009 2010 2011 2012 Agricultural $ 831,850 1,406,310 1,316,280 1,855,360 1,775,390 1,246,130 Commercial $1,794,794,160 1,773,319,530 1,833,163,370 1,863,856,900 1,795,046,310 1,704,687,600 Industrial $265,586,380 266,653,080 276,872,310 276,902,230 268,871,190 259,975,110 Residential $3,458,917,770 3,479,281,690 3,530,713,210 3,504,843,770 3,476,195,560 3,075,226,390 Utilities $2,740,960 2,479,960 5,577,460 6,244,810 6,239,400 6,587,200

_______
Source: Hamilton County Auditor's Office

Tax Levy, Collections and Collection Rate Real, Public Utility and Tangible Personal Property Percentage of Current Collections to Current Tax Levy 91.17% 91.96 90.95 90.34 91.16 Percentage of Total Collections to Current Tax Levy 96.20% 96.91% 95.89% 95.08% 96.85%

Collection Year 2007 2008 2009 2010 2011 ______

Current Tax Levy $62,613,790 60,231,182 59,802,565 58,408,485 59,551,554

Current Collections $57,086,757 55,389,318 54,389,764 52,764,131 54,284,679

Prior Year Collections $3,148,106 2,977,780 2,955,848 2,769,045 3,389,461

Total Collections $60,234,863 58,367,099 57,345,613 55,533,176 57,674,141

Source: City of Cincinnati Finance Department NOTE: Collections have been reduced for State reimbursements of personal property tax that had been included in prior year amounts. These amounts are included in intergovernmental revenues.

[Remainder of page intentionally left blank]

A-42

Twenty Largest Ad Valorem Taxpayers in City of Cincinnati 2011 The following is a list of the twenty largest ad valorem taxpayers (based on the taxable valuation of their property) subject to the City's taxing jurisdiction.
Name of Taxpayer Duke Energy Ohio City of Cincinnati Procter & Gamble Fifth Third Bank Carew Realty Inc OTR Columbia Development Regency Centers LP Childrens Hospital Hertz Center Cincinnati Board of Education Western & Southern Life Seven West Seventh Inc. Cincinnati & Suburban Bell Bre Retail Residual Owner CVG Partners LLC Christ Hospital The Kroger Co WLH Evergreen LLC 255 Fifth Limited ALL OTHERS TOTAL
_______
Note: The assessed valuation is based upon both the Personal and Real Property Valuation of the largest property holders in the City. Source: Hamilton County Auditor's Office

Nature of Business Public Utility Municipal Government Consumer Goods Manufacturing Financial Institution Real Estate Holdings Real Estate Holdings Real Estate Holdings Real Estate Holdings Health Care Real Estate Holdings Public Education Financial Services Real Estate Holdings Public Utility Consumer Goods & Services Real Estate Holdings Health Care Consumer Goods Real Estate Holdings Real Estate Holdings

Assessed Valuation $ 297,241,150 123,531,960 54,023,210 40,295,030 26,646,190 21,525,000 20,448,030 17,937,490 16,021,990 14,000,000 13,454,870 12,023,470 11,550,000 10,564,980 9,575,940 9,158,580 9,066,260 8,930,340 8,927,430 8,588,280 4,609,824,920 $ 5,343,335,120

Percentage of Total Valuation 5.56% 2.31% 1.01% 0.75% 0.50% 0.40% 0.38% 0.34% 0.30% 0.26% 0.25% 0.23% 0.22% 0.20% 0.18% 0.17% 0.17% 0.17% 0.17% 0.16% 86.27% 100.00%

[Remainder of page intentionally left blank]

A-43

Tax Duplicate and Levies per $1,000 Assessed Valuation

EFFECTIVE RATES Res./ Com./ Agr. Ind. 56.94 67.99 57.57 68.69 65.70 76.08 77.44 66.67 67.82 79.88 73.67 84.72 DEBT SERVICE INCLUDED IN City Total Levy Levy 5.36 10.05 5.36 10.05 5.36 10.50 5.36 10.31 5.47 10.37 5.90 11.40

Collection Year 2007 2008 2009 2010 2011 2012

Assessed Valuation $6,173,125,560 5,965,707,310 5,934,611,500 5,940,113,290 5,827,536,160 5,343,335,120

Co. Levy 20.18 20.56 20.63 21.48 21.48 21.06

School Levy 59.37 59.67 67.95 67.87 68.54 70.76

City Levy 9.93 9.89 9.89 9.82 10.07 10.50

Total Levy 89.48 90.12 98.47 99.17 100.09 102.32

_______
Source: Hamilton County Auditor's Office

Investment Policy Summary The City invests public funds in a manner that emphasizes maximum security of principal while meeting daily cash flow needs. Within these two parameters the City's objective is to earn the highest investment return possible while achieving the "prudent person" standard in managing the investment portfolio. State statutes and local ordinances authorize investment in obligations of the U.S. Treasury, federal agencies or instrumentalities, obligations of the State of Ohio, the Ohio subdivision's fund (STAR Ohio), repurchase agreements, no-load money market funds, municipal bonds or obligations of any Ohio political subdivision with at least a AA rating, and collateralized certificates of deposit. All security transactions must be conducted on a delivery versus payment basis. All investments must mature within five years from the date of settlement, unless the investment is matched to a specific obligation of the City. The City utilizes a laddered approach to scheduling investment maturities. The weighted average maturity of the investment portfolio shall not exceed three years. To diminish risk exposure to market price fluctuations, all investments are made with the intent to hold the investment until maturity, but may be sold earlier if deemed necessary or appropriate. Copies of the City's current Investment Policy are available from the Director of Finance, Room 250, City Hall, Cincinnati, Ohio 45202. Municipal Fiscal Emergencies The Ohio General Assembly enacted Chapter 118 of the Revised Code (hereinafter in this section the "Act") providing methods for dealing with fiscal emergencies of municipal corporations in Ohio. The Act applies only to those municipal corporations which are determined to have circumstances that constitute the existence of a fiscal emergency condition and, therefore, a fiscal emergency pursuant to Sections 118.03 and 118.04 of the Revised Code, as set forth in the Act. The Finance Director has reviewed applicable portions of the Act and has reviewed records pertaining to the City's circumstances with respect to the Act. Based upon the Finance Director's understanding of the Act, the Director is of the opinion that, with respect to the City, no circumstances or conditions exists that will cause a fiscal emergency condition to be determined to exist under the Act.

A-44

General Fund Major Revenue Categories Municipal Income Tax. The City presently levies a municipal income tax at the rate of 2.1%. This tax is subject to reduction or termination by the electors except to the extent of amounts necessary to comply with bond ordinance covenants to make annual appropriations of income taxes in such amounts as are necessary to meet annual debt charges on general obligation bonds. Any such diminution is subject to the provision of Ohio Revised Code Section 5705.51 that "to such extent such tax shall not be subject to diminution by initiative or referendum, or diminution by statute unless provision is made therein for an adequate substitute therefore, other than un-voted taxes on the general tax lists and duplicates (ad valorem property taxes), assigned by law to such purpose." Depending upon the manner in which any such reduction or termination were to be effected, City Council could retain the power to re-impose the tax up to one percent (1%) without elector authorization. The following tabulation reflects the municipal income tax collections, net of refunds, for years and the percentages and amounts legally required to be allocated, by purposes (000's omitted). Municipal Income Tax Collections
1.55% Operating Revenue $190,142* 193,411 210,537 219,000* 225,008* 231,758* 223,800 222,497 233,752 239,600 0.15% Capital Improvements $18,401 18,717 20,374 21,575 23,431 27,897 21,658 21,532 22,622 23,163 0.3% Public Transit $36,802 37,434 40,749 43,149 43,840 45,822 43,316 43,064 45,242 46,327 0.1% InfraStructure $12,267 12,478 13,583 14,383 14,614 15,274 14,439 14,355 15,081 15,442 Percent Increase 2.6% 1.7% 8.9% 5.9% 2.9% 5.0% -5.5% -0.6% 5.1% 2.5%

Year 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012(est.)

Rate 2.10% 2.10% 2.10% 2.10% 2.10% 2.10% 2.10% 2.10% 2.10% 2.10%

Total $257,612 262,040 285,243 298,107 306,883 320,751 303,213 301,448 316,697 324,532

________ * City policy through 2008 provided that income tax receipts in excess of the amount forecasted that year were to be transferred to the City's Income Tax Permanent Improvement Fund. In the years indicated with an asterisk (*), those amounts were $2.15 million, $3.84 million, $1.50 million and $4.99 million, respectively. Those excess amounts were carried forward for subsequent year operating needs as approved by City Council. Excess 2003 and 2006 1.55% City Income Tax revenue was reallocated from the Income Tax Permanent Improvement Fund to the General Fund for subsequent year operating needs. Excess 2007 and 2008 1.55% City Income Tax revenue was reallocated from the Income Tax Permanent Improvement Fund to the General Fund for 2010 operating needs.

[Remainder of page intentionally left blank]

A-45

Periodically, the City pledges lawfully available municipal income taxes from the 0.15% capital and the 0.1% infrastructure portions to pay annual debt charges. The amounts paid for principal and interest from the .15% capital are as follows: Year 2007 2008 2009 2010 2011 Amount $4,501,711 6,364,306 7,263,927 9,097,098 9,598,824

Intergovernmental Revenues. Intergovernmental Revenues consist primarily of state shared taxes, which include Estate Tax, Property Tax Reimbursements and the Local Government Fund. In 1988, the City and other political jurisdictions in Hamilton County, Ohio agreed to use an alternative formula in lieu of the statutory formula for the distribution of the Local Government Fund for the period 1989-1996. In November 1995, the extension of the use of the alternative formula was approved for the period 1997-2004. In February 2004, the extension of the use of the alternative formula was approved for the period 2005-2012. State legislative changes relating to the components and percentages of the State shared taxes in the Undivided Local Government Fund periodically occur. The freeze on the monthly Local Government Fund distribution at the State and local levels ended effective January 1, 2008. This resulted in a return to the use of the alternative formula for the full year rather than the fixed allocations that the freeze had established. The State revenues were down in 2009 and the amount distributed to local governments was lower than estimated. For 2010, intergovernmental revenues were higher than 2009 due to the full elimination of tangible personal property tax effective 2010 and full reimbursement of that tax from the State. The States 2012 budget included budget reductions to the Local Government Fund and the Property Tax reimbursement related to the tangible personal property and utility personal property reimbursement. The budget included a 25% reduction to the Local Government Fund for the state's fiscal year 2012. This translates to a reduction of $200,000 in 2011 and $8.4 million in 2012 to the General Fund. The State budget also includes an accelerated phase out of the tangible personal property tax reimbursements and public utility personal property that resulted in reduction in revenue of $1.8 million for 2011 and $2.2 million for 2012 to the General Fund. The States 2012 budget included a provision to repeal Estate Tax effective January 1, 2013. This had no effect on the city's 2011or 2012 budget. The city estimates $14.4 million in estate tax receipts for 2012. [Remainder of page intentionally left blank]

A-46

The following reflects the actual receipts from the major sources for the past five years. Intergovernmental Revenues (000's omitted) Year 2007 2008 2009 2010 2011 2012*
_____ *Estimate

Estate Tax $15,586 17,960 13,187 13,623 15,174 14,400

Property Tax Reimbursements $3,355 4,844 4,962 5,538 2,919 2,024

Local Government Fund $29,400 29,050 25,356 25,728 25,555 17,532

Total $48,341 51,854 43,505 44,889 43,648 33,956

Management's Discussion of Operations Fiscal Year Change. The City of Cincinnati will switch to a new fiscal year beginning in 2013. The new fiscal year will be July 1 June 30th. The primary reason for the change is to be on the same fiscal year as the State of Ohio. Due to potential budget reductions and the possibility of state shared revenues being reduced, similar fiscal years will greatly assist the City with the annual budget process. A secondary reason is due to City Council elections. Council members serve two-year terms and are sworn in on December 1st. The Citys current budget must be adopted by December 31st leaving only 30 days after members are sworn in to review and adopt a new budget. Under this timeline most budgets are approved without new council members input or understanding of the budget. This change in fiscal year will improve the overall timing of the budget process. 2012 General Fund Operating Budget. The approved 2012 Budget reflects a continuation of the service cuts undertaken in recent annual budgets. In fact, the approved 2012 Budget expenditures only represent 1% growth compared to the 2008 Budget. Since the 2008 Budget, 362 full-time General Fund positions have been eliminated. As employee attrition has taken place, the City has eliminated those positions from the budget altogether. Still, the City utilized $25 million in one-time sources of funding to balance the 2012 Budget as required by law. Due to the use of one-time sources, additional service cuts, beyond those experienced in the last three years, were not necessary. However, through a solid waste study and a police audit the City is reorganizing service delivery in order to save on costs. 2012 is the year to stabilize operations and position the City for growth through our on-going economic development initiatives. While City Council appropriation of General Fund expenditures is required by law on an annual basis, the City administration performs multi-year planning and biennial budgeting. Therefore, it has already recognized budgetary challenges in future years and is working to prepare potential solutions for presentation to City Council. Reserve accounts are projected to be 9.5% of prior year revenue for 2012, above the 5% floor established by City Council. On an historical basis, the following table reflects the fact that actual General Fund revenue for 2011 of $349.2 million was higher than the revised budgeted amount of $338.4 million, an increase of $10.8 million due to increase in income tax, estate tax and admission tax. Actual General Fund expenditures for 2011 (unaudited) were $346.7 million, which was lower than the budgeted amount of $355.9 million by $9.2 million or 2.6%. Approximately $1.8 million in savings were anticipated in the 2011 budget. The remaining variance is $7.4 million, or 2% of the expenditure budget. In August 2011 a mid-year reduction report was submitted to Council and included cost savings reductions which would A-47

provide for one-time carryover funding to assist with closing the projected 2012 General Fund deficit. The Administration was able to save a total of $4.5 million as a result of the items included in the report, less savings stemming from layoffs or departmental reorganizations. The remaining variance is $2.9 million, or less than 1% of the operating budget. This is mainly attributed to departments not filling budgeted vacant positions throughout the year including higher levels of attrition in Police and Fire than anticipated. In addition, recycling cost savings, election expense savings, and miscellaneous nonpersonnel savings also contributed to the higher savings amount. [Remainder of page intentionally left blank]

A-48

A-49

Working Capital Reserve. The City maintains a Working Capital Reserve fund that, by ordinance, must be from 5% to 8% of estimated General Fund revenue. The Working Capital Reserve fund balance at year-end 2011 (unaudited) was $20 million, which is approximately 5.7% of 2011 General Fund revenue. The 2012 budget included a $1 million transfer to the Working Capital Reserve. Year 2007 2008 2009 2010 2011 2012*
_____ *Estimate

Balance at Year End $24,313,164 25,312,304 26,029,797 19,640,158 20,021,611 21,158,330

A-50

APPENDIX B BASIC FINANCIAL STATEMENTS [SEE ATTACHED]

(This page intentionally left blank.)

BASIC FINANCIAL STATEMENTS

B-1

City of Cincinnati, Ohio Statement of Net Position December 31, 2011 (Amounts in Thousands) Governmental Activities ASSETS: Current Cash and Equivalents Equity in City Treasury Advances and Petty Cash Investments, at Fair Value Receivables: Taxes Accounts, Net Special Assessments Accrued Interest Due from Fiduciary Activities Due from Other Governments Prepaid Items and Other Assets Inventory Restricted Assets: Cash and Cash Equivalents Equity in City Treasury Investments, at Fair Value Internal Balances Total Current Assets Noncurrent Equity in City Treasury Restricted Equity in City Treasury Cash Restricted Investments, at Fair Value Accounts Receivable, Net Deferred Charges Land Buildings, net of Accumulated Depreciation Improvements, net of Accumulated Depreciation Machinery and Equipment, net of Accumulated Depreciation Construction in Progress Property Acquired under Capital Leases, net of Accumulated Amortization Infrastructure Assets, net of Accumulated Depreciation Total Noncurrent Assets Total Assets $ $ 39,371 115,435 205 49,399 107,235 54,075 15,631 1,920 3,069 19,889 2,083 5,339 $ 2,361 26,489 $ 41,732 141,924 205 49,399 107,438 74,806 15,631 2,411 3,069 31,787 8,119 10,766 Business-Type Activities Total

203 20,731 491 11,898 6,036 5,427

(10,871) 402,780

17,988 1,784 45,930 10,871 150,209

17,988 1,784 45,930

552,989

274,601

63,278 4,262 21,028 1,384 43,181 134,936 803,433 96,616 118,856 256

23,195 5,007 173,865 102,065 204,215 51,497 138,542 339 477,952 1,451,278 1,854,058 $

337,879 4,262 21,028 23,195 6,391 217,046 237,001 1,007,648 148,113 257,398 595 477,952 2,738,508 $ 3,291,497 (Continued)

1,287,230 1,437,439

The accompanying notes to the financial statements are an integral part of this statement.

B-2

City of Cincinnati, Ohio Statement of Net Position December 31, 2011 (Amounts in Thousands) (Continued) LIABILITIES: Current Accounts Payable Withholdings and Other Deposits Due to Fiduciary Activities Due to Other Governmental Agencies Accrued Payroll Accrued Liabilities Accrued Interest Deposits Payable Unearned Revenue Obligations Under Capital Leases Compensated Absences Payable Unpaid Claims Ohio Public Works Commission Loan Ohio Water Development Authority Loan Matured Bonds and Interest Payable Notes Payable General Obligation Bonds Revenue Bonds Other Advances from Other Governments Payable from Restricted Assets: Construction Contracts Deposits Payable Total Current Liabilities Noncurrent N Non-Current Obligations Under Capital Leases Notes Payable General Obligation Bonds Revenue Bonds Compensated Absences Payable Other Liabilities Ohio Public Works Commission Loan Ohio Water Development Authority Loan Unpaid Claims Payable Net Pension Obligation Net Other Post Employment Benefit Obligation Total NonCurrent Liabilities Total Liabilities Net Position Net Investment in Capital Assets Restricted Net Position for: Tax Increment Financing Debt Service Capital Projects Public Transit Public Safety Parks and Recreation Street Improvement Infrastructure Public Health Other Purposes Permanent Funds - Expendable Permanent Funds - Nonexpendable Unrestricted Net Position Total Net Position Governmental Activities $ 19,480 2,377 941 15,587 7,910 2,446 17,693 84,442 129 39,390 18,728 211 531 413 41,233 2,920 105 28 Business-Type Activities $ 3,854 283 1,066 1,980 1,643 57 609 6,351 60 4,497 225 218 325 $ Total 23,334 2,377 1,224 1,066 17,567 9,553 2,503 18,302 90,793 189 43,887 18,953 429 325 531 413 44,430 20,620 105 28 5,722 643 302,994 284 12,887 392,419 542,201 65,265 1,153 5,625 6,578 30,489 120,541 88,048 1,265,490 1,568,484 1,486,988 36,955 42,868 86,983 17,651 4,576 7,960 5,770 5,655 752 7,952 7,386 2,200 9,317 1,723,013

3,197 17,700

5,722 643 254,564 224 12,887 378,745 92,748 61,325 1,153 2,425 30,489 94,075 69,483 743,554 998,118 741,266 36,955 19,858 86,983 17,651 4,576 7,960 5,770 5,655 752 7,952 7,386 2,200 (89,024) 855,940 $ 48,430 60 13,674 449,453 3,940 3,200 6,578 26,466 18,565 521,936 570,366 745,722

23,010

98,341 867,073

accompanying The accompanying notes to the financial statements are an integral part of this statement. integral part

B-3

City of Cincinnati, Ohio

Statement of Activities For the year ended December 31, 2011 (Amounts in Thousands) Net (Expense) Revenue and Program Revenues Operating Charges Expenses for Services Contributions Contributions Activities Activities Grants and Grants and Governmental Business-Type Total Capital Changes in Net Position

Functions/Programs

Governmental Activities: $ 45,274 42,419 242,159 34,121 41,746 57,415 47,862 23,004 651,064 116,819 66,024 27,012 10,314 9,428 91 36 349 1,024 1,360 32 15,615 19,331 15,507 403 (206,918) (17,114) (41,746) (56,006) (28,029) (23,004) (441,209) 7,059 1,748 640 (32,972) 37 35,422 546 (9,269) 117,064 $ 78,682 $ 3,538 $ 8,693 $ (26,151) $ (26,151) (9,269) (32,972) (206,918) (17,114) (41,746) (56,006) (28,029) (23,004) (441,209)

General Government

Community Development

Parks and Recreation

Public Safety

Transportation and Engineering

Transit System

Public Services

Public Health

Interest on long-term debt Total governmental activities

Business type activities: 119,423 8,807 15,484 2,729 2 729 7,313 11,157 164,913 $ General Revenues: Taxes: Property taxes Income taxes Admission taxes Shared taxes Occupancy taxes Unrestricted investment earnings Miscellaneous Transfers between governmental and business-type activities Total general revenues and transfers Special Item - Loss on Sale of Gateway Garage Special Item - Repayment of Tax Incentive Change in net position Net position-beginning Net position-ending $ 14,000 60,627 795,313 855,940 $ (5,131) 872,204 867,073 $ 53,335 325,089 4,450 62,012 2,270 9,407 31,844 (571) 487,836 1,394 4,515 1,486 571 7,966 (4,785) 495,802 (4,785) 14,000 55,496 1,667,517 1,723,013 53,335 325,089 4,450 62,012 3,664 13,922 33,330 815,977 $ 269,876 $ 153,057 66,024 $ 8,412 3,544 30,556 (441,209) 5,270 2,044 2 044 7,513 89 10,385 119,433 3,305 150 $ 3,315 1,728 (7,971) (596) (2,043) (2,745) (8,312) (8,312) 3,315 1,728 (7,971) (596) (2,043) (2,745) (8,312) (449,521)

Water Works

Parking Facilities

B-4
Total Business-type activities Total

Convention Center

General Aviation

Municipal Golf

Stormwater Management

The accompanying notes to the financial statements are an integral part of this statement.

City of Cincinnati, Ohio Balance Sheet Governmental Funds December 31, 2011 (Amounts in Thousands) Capital Projects Debt Service Other Governmental Funds Total Governmental Funds

General ASSETS Cash and Equivalents Equity in City Treasury Cash Advances and Petty Cash Investments, at Fair Value Receivables: Taxes Accounts, Net Special Assessments Accrued Interest and Dividends Due from Other Funds Due from Fiduciary Funds Due from Other Governments Inventory Advances to Other Funds Total Assets LIABILITIES AND FUND BALANCES Liabilities: Accounts Payable Withholdings and Other Deposits Due to Other Funds Due to Fiduciary Funds Accrued Payroll Accrued Liabilities Deposits Payable Deferred Revenue Estimated Liability for Unpaid Claims Advances from Other Funds Matured Bonds and Interest Payable Total Liabilities Fund Balances: Nonspendable Restricted Committed Assigned Unassigned Total Fund Balances Total Liabilities and Fund Balances $

14 87,657 205

37,469 112,524 11,201

$ 61,639 2,021 34,971 33,898 275 1,729

1,700 95,396 36,177 9,111 19,167 14,936 73 3,272 59 6,658 445 1,049

39,183 357,216 205 49,399 107,235 76,912 15,631 1,825 7,813 59 19,706 4,899 1,351

59,736 9,301 312 1,279 2,685 13,048 3,556 302 $ 178,095 $

3,417 14,546 383 198 127

898

180,763

134,533

188,043

681,434

2,654 3,172 1,275 598 13,094 145 4,767 51,695 368 521 78,289

8,062 10,717

35

3,632 594 290 2,112 541 2,638 39,942 1,637 653 52,039

2 11 4 7,574 16,341 11,564 531 54,262 53,443 1,712 51,093 59

14,383 3,172 12,586 890 15,217 690 16,691 159,071 2,064 12,738 531 238,033

4,063 5,287 24,975 65,481 99,806 178,095 $

898 125,603

81,090

2,645 117,086 18,021 (1,748)

7,606 323,779 23,308 24,975 63,733 443,401 $ 681,434

126,501 180,763 $

81,090 134,533 $

136,004 188,043

The accompanying notes to the financial statements are an integral part of this statement.

B-5

CITY OF CINCINNATI, OHIO Reconciliation of the Balance Sheet to the Statement of Net Position Governmental Funds December 31, 2011 (Amounts in Thousands)

Total fund balances - governmental funds Amounts reported for governmental activities in the statement of net position are different because: Capital assets (net of accumulated depreciation) used in governmental activities are not financial resources and therefore are not reported as assets in governmental funds. Certain receivables will be collected next year, but are not available soon enough to pay for the current period's expenditures, and therefore are deferred in the funds. Some amounts reported for governmental-type activities in the statement of net position are different because certain internal service fund assets and liabilities are included with business-type activities. Six internal service funds are used by the City's management. The assets and liabilities of the internal service funds are included with governmental activities. The net property of $25,260 as it relates to the internal service funds is included in the capital asset amount above.

443,401

1,148,475

74,668

1,379

3,926

Bond issue costs, discounts and deferred loss on refunding are expended in the fund level financial statements but are capitalized and amortized over the life of the bonds in the government-wide financial statements. This is the unamortized portion of those issue costs, discounts and loss on refunding. Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-term liabilities at year-end consist of: G.O. Bonds and notes payable Revenue bonds payable Long Term Notes Payable Deferred bond premium Compensated absences Net Pension Obligation Net Other Post Employment Benefit Obligation Ohio Public Works Commission Loans Unpaid claims payable Accrued interest on bonds Accrued Liabilities Other liability Capital leases payable Total net position - - governmental activities (page 36) The accompanying notes to the financial statements are an integral part of this statement. $

6,758

(411,574) (95,715) (13,300) (10,108) (99,447) (86,812) (65,304) (2,636) (27,231) (2,446) (6,483) (1,258) (353) 855,940

B-6

City of Cincinnati, Ohio Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the year ended December 31, 2011 (Amounts in Thousands) Other Governmental Funds $ 62,737 4,019 2,748 4,925 19,697 55,451 3,759 15,005 19,574 187,915 Total Governmental Funds $ 377,508 11,313 38,047 4,993 71,506 62,508 17,844 35,007 35,399 654,125

General REVENUES Taxes Licenses and Permits Use of Money and Property Special Assessments Intergovernmental Revenue Federal Grants State Grants and Subsidies Charges for Current Services Miscellaneous Total Revenues EXPENDITURES Current: General Government Community Development Parks and Recreation Public Safety Transportation and Engineering Transit System Public Services Public Health Employee Benefits Capital Outlay Debt Service: Principal Retirement Interest Bond Issuance Cost Total Expenditures Excess (Deficiency) of Revenues over (under) Expenditures OTHER FINANCING SOURCES(USES) General Obligation Bonds Issued Revenue Bonds Issued Refunding Bonds Issued Payments to Refunded Bonds Escrow Agent Discounts on Bonds Premium on Bonds Issued Transfers In Transfers (Out) Total Other Financing Sources(Uses) SPECIAL ITEMS Repayment of Tax Incentive Net change in fund balances Fund Balances at January 1 Fund Balances at December 31 $ 14,452 85,354 99,806 $ $ 262,709 7,294 11,356 42,791 $

Capital Projects 22,675 1,197 68 1,346 7,057 14,085 177 2,833 49,438 $

Debt Service 29,387 22,746 7,672

19,825 2,142 346,117

10,850 70,655

31,471 4,406 16,383 165,771 1,146 15,457 13,654 82,308

625 107

1,394 3

107,784 211 55 330,596 15,521 108,782 (59,344) 39,888 19 528 19,528 572 61,385 9,270

31,492 3,977 9,558 11,661 5,095 41,746 13,430 16,549 12,624 37,082 770 3 087 3,087 278 187,349 566

64,982 8,386 26,048 177,432 6,241 41,746 28,887 30,203 94,932 144,866 40,869 22 670 22,670 850 688,112 (33,987)

17,530

31,470 21,000 19,000 (20,683) 3,536 13,925 (49,976) (2,728) (180) 333 2,293 (8,317) 15,129

2,639 (3,708) (1,069)

55,433 (12,641) 60,322

49,000 21,000 19,000 (20,683) (180) 3,869 74,290 (74,642) 71,654

14,000 978 125,523 126,501 $ 20,542 60,548 81,090 $ 15,695 120,309 136,004 $

14,000 51,667 391,734 443,401

The accompanying notes to the financial statements are an integral part of this statement.

B-7

CITY OF CINCINNATI, OHIO Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities Governmental Funds For the year ended December 31, 2011 (Amounts in Thousands)

Net change in fund balances - total governmental funds Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays ($124,973) exceeded depreciation ($46,040) in the current period. Governmental funds report cash received for assets disposed of as revenue. However, in the statement of activities, that cash offsets the difference between the book value ($8,082) and accumulated depreciation of the disposed asset ($4,719). Statement of activities reports an increase in revenues due to current activity in deferred revenues which is not reported at fund level. The long-term liability for compensated absences is not recorded in the fund level, but is reported in the statement of activities. This is the current year change in the liability, reported as an expense in the statement of activities. The long-term liability for unpaid claims is not recorded in the fund level, but is reported in the statement of activities. This is the current year change in the liability, reported as an expense in the statement of activities. The long-term liability for Net Pension Obligation is not recorded in the fund level, but is reported in the statement of activities. This is the current year change in the liability, reported as an expense in the statement of activities. The long-term liability for Net Other Post Employment Benefit Obligation is not recorded in the fund level, but is reported in the statement of activities. This is the current year change in the liability, reported as an expense in the statement of activities.

51,667

78,933

(3,363)

7,368

1,048

(2,337)

(17,876)

(13,611)

Bond proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net position. Repayment of bond and loan principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position. This is the amount by which proceeds exceeded repayments.

(41,781)

(Continued)

B-8

CITY OF CINCINNATI, OHIO Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities Governmental Funds For the year ended December 31, 2011 (Amounts in Thousands) (Continued) Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Bond premiums are included in revenue at the fund level, but capitalized and amortized over the life of the bonds in the government-wide financial statements. Bond issuance costs are included in expenditures at the fund level, but are deferred and amortized over the life of the bonds in the government-wide financial statements Bond discounts are included in expenditures at the fund level, but are deferred and amortized over the life of the bonds in the government-wide financial statements Internal balances between the governmental activities and the business type activities are not reported at the fund level. Internal service funds are used by management to charge the costs of certain activities, such as insurance and telecommunications, to individual funds. The net revenue(expense) of certain internal service funds is reported with governmental activities. Change in net position of governmental activities (page 37) $

279

(2,557)

1,086

137

567

1,067 60,627

The accompanying notes to the financial statements are an integral part of this statement.

B-9

City of Cincinnati, Ohio Statement of Net Position Proprietary Funds December 31, 2011 (Amounts in Thousands)

Business-Type Activities - Enterprise Funds Other Total Water Enterprise Enterprise Works Funds Funds ASSETS Current: Cash and Equivalents Equity in City Treasury Cash Receivables: Taxes Accounts, Net Accrued Interest Due from Other Funds Due from Fiduciary Funds Due from Other Governments Prepaid Items Inventory Advances to Other Funds Restricted Assets: Cash and Equivalents Equity in City Treasury Cash Investments, at Fair Value Total Current Assets Noncurrent: Equity in City Treasury Cash Restricted Equity in City Treasury Cash Restricted Investments, at Fair Value Deferred Charges D f d Ch Land Buildings, net of Accumulated Depreciation Improvements, net of Accumulated Depreciation Machinery and Equipment, net of Accumulated Depreciation Construction in Progress Property Acquired under Capital Leases, net of Accumulated Amortization Other Assets Total Noncurrent Assets Total Assets

Governmental Activities Internal Service Funds

2,291 18,588

70 7,901 203 2,505 116 797 819 47 9,916

2,361 26,489 203 20,731 491 2,757 11,898 6,036 5,427 9,966 17,988 1,784 45,930

188 9,686

18,226 375 1,960 11,079 5,989 5,427 50 17,988 1,784 45,930 129,687

358 95 2,590 3,010 183 1,268 440 1,648

22,374

152,061

19,466

44,400 4,262 21,028 1,384 1 384 2,727 120,572 620,304 95,512 105,255 120

18,878

40,454 14,364 183,129 1,104 13,601 136

63,278 4,262 21,028 1,384 1 384 43,181 134,936 803,433 96,616 118,856 256

23,134

283 7,865 17,146

245 815 49,488 $ 68,954 (Continued)

1,015,564 $ 1,145,251

271,666 $ 294,040

1,287,230 $ 1,439,291

The accompanying notes to the financial statements are an integral part of this statement.

B-10

CITY OF CINCINNATI, OHIO Statement of Net Position Proprietary Funds December 31, 2011 (Amounts in Thousands) Business-Type Activities - Enterprise Funds Other Total Water Enterprise Enterprise Works Funds Funds Governmental Activities Internal Service Funds

(Continued) LIABILITIES Current: Accounts Payable Due to Other Funds Due to Fiduciary Funds Due to Other Governments Accrued Payroll Accrued Liabilities Accrued Interest Obligations under Capital Lease Deposits Payable Unearned Revenue Compensated Absences payable Unpaid Claims payable Ohio Public Works Commission Loan Ohio Water Development Authority Loan General Obligation Bonds and Notes Payable Revenue Bonds Payable Payable from Restricted Assets: Construction Contracts Deposits Payable Total Current Liabilities Noncurrent: Compensated Absences Payable Obligations Under Capital Lease Ohio Public Works Commission Loan Ohio Water Development Authority Loan Estimated liability for Unpaid Claims Advances from Other Funds Advances from Other Governments Revenue Bonds Payable General Obligation Bonds and Notes Payable Net Pension Obligation Net Other Post Employment Benefit Obligation Total Noncurrent Liabilities Total Liabilities NET POSITION Net Investment in Capital Assets Restricted Net Position Other Unrestricted Net Position Total Net Position

2,203 325 257 1,066 1,790 20 60

1,651 148 26 190 1,643 37 4 6,956 441 5

4,056 220 218 325 2,000 17,700 5,722 643 36,605

1,197

3,854 473 283 1,066 1,980 1,643 57 60 4 6,956 4,497 225 218 325 3,197 17,700 5,722 643

5,170 101 51 370 743 101 134 39 578 12,337

12,298

48,903

19,624

3,548 60 3,200 3 200 6,578

392

3,940 60 3,200 3 200 6,578

690 178

7,585 227 22 449,453 3,800 23,315 16,411 506,365 542,970 9,874 3,151 2,154 15,571 27,869 449,453 13,674 26,466 18,565 521,936 570,839

7,263 4,179 20,144 39,768

501,685 23,010 77,586 $ 602,281 $

244,037

745,722 23,010 99,720 868,452 $

25,260 815 3,111 29,186

22,134 266,171

Some amounts reported for business-type activities in the statement of net position are different because certain internal service fund assets and liabilities are included with business-type activities. Net position of business type activities $

(1,379) 867,073

The accompanying notes to the financial statements are an integral part of this statement.

B-11

City of Cincinnati, Ohio Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Funds

For the year ended December 31, 2011

(Amounts in Thousands)

Business-Type Activities - Enterprise Funds Total Other Water Enterprise Enterprise Works Funds Funds OPERATING REVENUES Charges for Current Services Miscellaneous Total Operating Revenues

Governmental Activities Internal Service Funds

119,433 1,249 120,682

33,624 244 33,868

153,057 1,493 154,550

115,174 2,066 117,240

OPERATING EXPENSES Personal Services Contractual Services Maintenance and Repairs Materials and Supplies Utilities Insurance Taxes Depreciation and Amortization Rent Other expense Total Operating Expenses Operating Income(Loss)

47,129 8,329 4,536 8,976 7,530 121 3 24,920 1,252 328 103,124 17,558

6,031 17,364 2,728 428 914 102 2,785 13,475 513 682 45,022 (11,154)

53,160 25,693 7,264 9,404 8,444 223 2,788 38,395 1,765 1,010 148,146 6,404

9,959 4,501 596 11,905 428 85,995 4 5,191 2,150 16 120,745 (3,505)

NONOPERATING REVENUES(EXPENSES) Interest revenue Build America Bond Subsidy Occupancy tax receipts Interest expense Gain/Loss on disposal of assets Nonoperating Revenues(Expenses) Income (Loss) before Contributions and Transfers Transfers In Transfers (Out) Capital contributions Change in Net Position Net Position at January 1 Net Position at December 31 $

2,309 1,701 (14,909) (829) (11,728) 5,830 131 3,304 9,265 593,016 602,281 $

505 1,394 (468) (4,785) (3,354) (14,508) 1,529 (1,089) 239 (13,829) 280,000 266,171

2,814 1,701 1,394 (15,377) (5,614) (15,082) (8,678) 1,660 (1,089) 3,543 (4,564)

551

(17) 313 847 (2,658) 1,970 (2,189) 856 (2,021) 31,207 $ 29,186

Some amounts reported for business-type activities in the statement of net position are different because the net revenue of certain internal service funds is reported with business type activities. Change in net position of business type activities $

(567) (5,131)

The accompanying notes to the financial statements are an integral part of this statement.

B-12

City of Cincinnati, Ohio

Statement of Cash Flows Proprietary Funds For the year ended December 31, 2011 (Amounts in Thousands) Business-Type Activities - Enterprise Funds Other Total Water Enterprise Enterprise Works Funds Funds Reconciliation of Operating Income (Loss) to Net Cash Provided (Used) by Operating Activities: Operating Income (Loss) Depreciation and Amortization Changes in Assets and Liabilities: (Increase) Decrease in: Receivables Due from Other Funds Due from Fiduciary Funds Due from Other Governments Inventory Prepaid Items Increase (Decrease) in: Accounts Payable Deposits Payable Due to Other Funds Due to Fiduciary Funds Accrued Payroll Accrued Liabilities Advances from Other Governments Unearned Revenue Liability for Compensated Absences Estimated Liability for Unpaid Claims Net Pension Obligation Net Other Post Employment Benefit Obligation Net Cash Provided (Used) by Operating Activities Governmental Activities Internal Service Funds

17,558 24,920

(11,154) 13,475

6,404 38,395

(3,505) 5,191

328 96 (768) 510 (2,422) (478) 150 (23) (87) (159)

122 5 (109) 65 982 39 (10) (72) 15 (174) (76) 2 412 311 3,833

450 101 (877) 510 (2,357) 504 150 16 (97) (231) 15 (174) (65) 28 4,191 3,152 50,115

(178) 377 (16) 584 5 134 (1,186) 71 69 (14) (75) (32) 1 (20) (140) (1,921) 784 590 719

11 26 3,779 2,841 46,282

Schedule of Noncash Investing, Capital and Financing Activities: Change in Fair Value of Investments Acquisition of Property, Plant and Equipment from Transfer to Other Funds Capital Contributions Total Noncash Investing, Capital and Financing Activities $ 211 2,181 $ 2,392 $ $ 135 44 239 418 $ $ 346 44 2,420 2,810 $ $ 118 (283) 856 691

The accompanying notes to the financial statements are an integral part of this statement.

B-13

City of Cincinnati, Ohio

Statement of Cash Flows Proprietary Funds For the year ended December 31, 2011 (Amounts in Thousands) Business-Type Activities - Enterprise Funds Total Other Enterprise Water Enterprise Works Funds Funds Cash Flows from Operating Activities: Receipts from Customers Receipts from Other Funds Receipts from Retirement System Payments to Suppliers Payments to Other Funds Payments to Employees Payments for Property Taxes Net Cash Provided (Used) by Operating Activities Cash Flows from Noncapital Financing Activities: Repayment of Advances Made To Other Funds Amount Due from Other Funds for City Notes Advances To Other Funds Occupancy Tax Receipts Transfers to Other Funds Transfers from Other Funds Net Cash Provided(Used) by Noncapital Financing Cash Flows from Capital and Related Financing Activities: Capital Contributed by Other Sources Capital Items Expensed Proceeds from the Sale of Capital Assets Proceeds from Ohio Public Works Bonds Proceeds from Ohi W t D P d f Ohio Water Development A th it L l t Authority Loan Proceeds from Sale of Bonds and Notes Acquisition of Property, Plant and Equipment Interest Paid on Bonds and Notes Principal Paid on Bonds and Notes Principal Paid on Ohio Public Works Bonds Principal Paid on Ohio Water Development Authority Loan Payments on Long Term Capital Lease Obligations Additions to Construction in Progress Net Cash Provided (Used) by Capital and Related Financing Activities Cash Flow from Investing Activities: Investments Purchased Interest on Investments Net Cash Provided (Used) by Investing Activities Net Increase (Decrease) in Cash and Cash Equivalents Cash and Cash Equivalents at Beginning of Year Cash and Cash Equivalents at End of Year $ 28 54 69 2,558 2 558 84,310 (4,922) (13,361) (38,545) (219) (359) (59) (50,127) (20,573) (25,856) 4,352 (21,504) 5,364 83,949 89,313 $ 202 385 4,098 230 385 4,152 69 2,558 2 558 84,310 (4,940) (13,832) (39,742) (219) (359) (70) (54,453) (21,911) (25,856) 4,978 (20,878) 11,219 104,943 $ 116,162 $ (107) $ 120,337 (33,393) (40,658) (4) 46,282 $ 31,494 2,216 (19,431) (4,181) (5,164) (1,101) 3,833 (983) 82 1,833 1,362 (1,089) 1,529 2,734 $ 151,831 2,216 (52,824) (4,181) (45,822) (1,105) 50,115 (983) 1,110 1,833 1,362 (1,089) 1,660 3,893 Governmental Activities Internal Service Funds $ 13,767 77,294 26,662 (105,620) (2,569) (8,815) 719 167 365 (2,189) 1,165 (492)

1,028

131 1,159

(18) (471) (1,197) (11) (4,326) (1,338)

(122) (17)

(77) (628) (951)

626 626 5,855 20,994 26,849

669 669 (55) 33,063 33,008

The accompanying notes to the financial statements are an integral part of this statement.

B-14

City of Cincinnati, Ohio Statement of Fiduciary Net Position Fiduciary Funds December 31, 2011 (Amounts in Thousands) Investment Trust Fund $ $ 118,167

Pension Trust ASSETS Cash and Equivalents Equity in City Treasury Cash Investments, at fair value: U. S. Treasury Bills and Notes Canadian Bonds International Bonds Convertible Bonds US Government Bonds Tax Exempt Government Municipal Corporate Fixed Income State and Local Obligations US Agencies Equities - Common Stock Venture Capital Real Estate Private Placements Other Assets (Alternatives) Total Investments, at Fair Value Collateral on Loaned Securities Receivables: Accounts, Net Accounts Receivable for Securities Sold Accrued Interest and Dividends Due from Primary Government Due from Other Governments Loans Receivable Machinery and Equipment Accumulated Depreciation Total Assets LIABILITIES Accounts Payable Accounts Payable for Securities Purchased Due to Primary Government Due to Other Governmental Agencies Obligations Under Securities Lending Accrued Payroll Accrued Liabilities Deposits Payable Estimated Liability for Compensated Absences Net Pension Obligation Net Other Post Employment Benefit Obligation Total Liabilities NET POSITION Held in Trust for External Pool Participant Held in Trust for Employees' Pension Benefits Held in Trust for Employees' Postemployment Healthcare Benefits Total Net Position $ 28,872

Agency 6 3,042 280,861

1,730 23,780 5 48,355 1,080 30,907 4,652 119,427 946,670 171,049 161,838 19,114 417,875 1,946,482 26,441 280,861

332 61,424 3,546 1,224 1,224 6,689 795 (444) 2,076,585

34,230 2,950

118,167

321,089

1,845 61,616 3,069 26,441 50 13,173 105

19,735

245,251 2,140 47 3,164 8,963 31,083 10,706 321,089

106,299 118,167 1,353,823 616,463 1,970,286

118,167

The accompanying notes to the financial statements are an integral part of this statement.

B-15

City of Cincinnati, Ohio Statement of Changes in Fiduciary Net Position Fiduciary Funds For the year ended December 31, 2011 (Amounts in Thousands) Investment Trust Fund $ 14,171 31,160 2,142 408,401 47,473 142 408,401

Pension Trust ADDITIONS Contributions: Plan members Employer Other Participant Deposits Total Contributions $

Transfers From Other Retirement Systems

Investment earnings: Interest and Dividends Proceeds from Litigation Net Appreciation in the Fair Value of Investments Total Investment Earnings Less Investment Management Expenses

43,001 61 (14,848) 28,214 9,049 19,165

1,945

429 2,374 2,374

Net Income (Loss) From Investing Activities

From Security Lending Activities: Securities Lending Income Securities Lending Expense: Borrower Rebates Management Fees Total Securities Lending Expenses Net Income from Securities Lending Activities Total Additions (Losses)

74 405 (120) 285 359 67,139 410,775

DEDUCTIONS Benefit Payments: Pension and Annuities Distributions to Participants Hospital and Medical Care Medicare Dental Benefits Vision Benefits Death Benefits, Active and Retired Transfers - Retirement to other systems Total Benefits Payments Refunds of Contributions Administrative expenses: Personal Services Contractual Services Materials and Supplies Depreciation Total Administrative Expenses Total Deductions Change in Net Position Net Position at January 1 Net Position at December 31 $

143,346 386,014 42,750 3,884 1,755 143 927 2,186 194,991 2,552 386,014

756 833 65 131 1,785 199,328 (132,189) 2,102,475 1,970,286 $ 386,014 24,761 93,406 118,167

The accompanying notes to the financial statements are an integral part of this statement.

B-16

APPENDIX C OPINION OF BOND COUNSEL The form of the legal approving opinion of Peck, Shaffer & Williams LLP, Bond Counsel, is set forth below. The actual opinion will be delivered on the date of delivery of the Series 2012 Bonds referred to therein and may vary from the form set forth to reflect circumstances both factual and legal at the time of such delivery. Recirculation of the Official Statement shall create no implication that either Peck, Shaffer & Williams LLP has reviewed any of the matters set forth in such opinion subsequent to the date of such opinion. December __, 2012 City of Cincinnati, Ohio Cincinnati, Ohio PNC Capital Markets LLC Cincinnati, Ohio Re: Fifth Third Securities, Inc. Cincinnati, Ohio Rice Financial Products Company Columbus, Ohio

$28,000,000* City of Cincinnati, Ohio Unlimited Tax Urban Redevelopment Improvement General Obligation Bonds, Series 2012D (the Series 2012D Bonds) $5,000,000* City of Cincinnati, Ohio Unlimited Tax Urban Redevelopment General Obligation Bonds, Series 2012E Bonds (Streetcar System) (the Series 2012E Bonds) and $30,000,000* City of Cincinnati, Ohio Unlimited Tax Various Purpose General Obligation Refunding Bonds, Series 2012F (the Series 2012F Bonds and collectively with the Series 2012D Bonds and the Series 2012E Bonds, the Series 2012 Bonds)

Ladies and Gentlemen: We have examined the transcript of proceedings submitted relating to the issuance of the above-referenced Series 2012 Bonds of the City of Cincinnati (the City), County of Hamilton, Ohio, dated as of the date specified above and of the denominations of $5,000 and any integral multiple thereof. The Series 2012 Bonds mature, are subject to optional and mandatory redemption, and bear interest upon the terms set forth therein. These Series 2012 Bonds are issued under authority of the general laws of the State of Ohio and the Charter of the City of Cincinnati, by virtue of certain ordinances and proceedings of the Council of said City in relation thereto. We have also examined an executed and authenticated Series 2012D Bond, Series 2012E Bond and Series 2012F Bond of the first maturity, respectively.

Preliminary; subject to change.

C-1

Based on this examination, we are of the opinion, based upon laws, regulations, rulings and decisions in effect on the date hereof, that: 1. The Series 2012 Bonds constitute valid obligations of the City in accordance with their terms, which, unless paid from other sources, are payable from an ad valorem tax to be levied upon all the taxable property in the City without limitation as to rate or amount. 2. Under the laws, regulations, rulings and judicial decisions in effect as of the date hereof, interest on the Series 2012 Bonds is excludible from gross income for Federal income tax purposes, pursuant to the Internal Revenue Code of 1986, as amended (the Code). Furthermore, interest on the Series 2012 Bonds will not be treated as a specific item of tax preference, under Section 57(a)(5) of the Code, in computing the alternative minimum tax for individuals and corporations. In rendering the opinions in this paragraph, we have assumed continuing compliance with certain covenants designed to meet the requirements of Section 103 of the Code. 3. The interest on the Series 2012 Bonds, and any profit made on their sale, exchange or other disposition, are exempt from the Ohio personal income tax, the Ohio commercial activity tax, the net income base of the Ohio corporate franchise tax and Ohio municipal, school district and joint economic development district income taxes. The City has not designated the Series 2012 Bonds as qualified tax-exempt obligations with respect to investments by certain financial institutions under Section 265 of the Code. In giving this opinion, we have relied upon covenants and certifications of facts, estimates and expectations made by officials of the City and others contained in the transcript which we have not independently verified. It is to be understood that the enforceability of the Series 2012 Bonds may be subject to bankruptcy, insolvency, reorganization, moratorium and other laws in effect from time to time affecting creditors rights, and to the exercise of judicial discretion. Very truly yours,

C-2

APPENDIX D DEPOSITORY TRUST COMPANY The Depository Trust Company (DTC), New York, NY, will act as securities depository for the 2011A Bonds (the Securities). The Securities will be issued as fullyregistered securities registered in the name of Cede & Co. (DTCs partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. DTC, the worlds largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a banking organization within the meaning of the New York Banking Law, a member of the Federal Reserve System, a clearing corporation within the meaning of the New York Uniform Commercial Code, and a clearing agency registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTCs participants (Direct Participants) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (DTCC). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (Indirect Participants). DTC has a Standard & Poors 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. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTCs records. The ownership interest of each actual purchaser of each Security (Beneficial Owner) is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued.

D-1

To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTCs partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTCs records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the Paying Agent and 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 Securities within an issue are being redeemed, DTCs practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTCs MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede &. Co., or such other nominee as may be requested by an authorized representative of DTC. DTCs practice is to credit Direct Participants accounts upon DTCs receipt of funds and corresponding detail information from the City, on payable date in accordance with their respective holdings shown on DTCs 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 or the City, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the City, 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.

D-2

DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to the City. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered. The City may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC. The information in this section concerning DTC and DTCs 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.

D-3

Printed By www.MuniDeals.com