OFFICIAL STATEMENT

NEW ISSUE-BOOK ENTRY ONLY RATINGS: Standard & Poor's: A+ (See "RATINGS" herein)

In the opinion of Bond Counsel, interest on the Governmental Utility Services Corporation of the City of Aliceville, Water and Sewer Taxable Revenue Bonds, Series 2011 (the “Series 2011 Bonds”), is not excludable from the gross income of the recipient for Federal Income tax purposes. Bond Counsel is of the further opinion that the interest income on the Series 2011 Bonds is exempt from Alabama income taxation. See “TAX MATTERS RELATED TO SERIES 2011 BONDS” herein for certain other tax consequences to the recipients of the interest income on the Series 2011 Bonds.

$10,280,000 GOVERNMENTAL UTILITY SERVICES CORPORATION

OF THE CITY OF ALICEVILLE (ALABAMA) Water and Sewer Taxable Revenue Bonds

(Federal Bureau of Prisons Project)

Dated: March 1, 2011 Due: August 1, as shown inside cover

The Series 2011 Bonds will constitute limited obligations of the Governmental Utility Services Corporation of the City of Aliceville, (the "GUSC"), payable solely out of payments under a Water and Sewer Services Agreement between the GUSC and the City of Aliceville, Alabama (the "City") dated as of December 22, 2010, pursuant to which the GUSC will supply water and sewer services to the new federal correctional institution (“FCI”) being constructed near the City of Aliceville in Pickens County, Alabama by the United States Federal Bureau of Prisons (“FBOP”). The City has a contract with the FBOP to provide water and sewer services to the FCI, and pursuant to such contract (hereinafter the “FBOP Contract”) the FBOP will pay for the actual amount of such water and sewer services utilized by the FCI each month. In order to fulfill its obligation to provide water and sewer services to the FCI pursuant to the FBOP Contract, the City has entered into the Water and Sewer Services Agreement with the GUSC. The City will pay the GUSC each month, a water and sewer service fee based upon the amount of water and sewer services supplied to the FCI by the GUSC. Based upon the established water and sewer rates and the anticipated usage by the FCI, it is anticipated that the GUSC’s revenue will be sufficient to provide for the payment, when due, of the principal of and interest and premium (if any) on the Series 2011 Bonds.

Interest will be payable on August 1, 2011, and on each August 1 and February 1 thereafter. The Series 2011 Bonds will be initially issuable only as fully registered bonds (without coupons) in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), New York, New York, which has been effectively designated by the GUSC and the Trustee (hereinafter referred to) to act as securities depository for the Series 2011 Bonds. So long as the book-entry system created pursuant to the Indenture (hereinafter referred to) is maintained in effect, individual purchases of Series 2011 Bonds may be made in book-entry form only, in the principal amount of $5,000 or any integral multiple thereof and purchasers of the Series 2011 Bonds will not receive certificates representing their respective interests in the Series 2011 Bonds so purchased. Furthermore, so long as DTC acts as securities depository for the Series 2011 Bonds, the principal of and interest (and premium, if any) on the Series 2011 Bonds will be payable by the aforesaid Trustee to DTC, which is required in turn to remit such principal and interest to its Participants, each of which is required to remit such principal and interest to the Beneficial Owners of such Series 2011 Bonds, all as described under the caption "BOOK-ENTRY ONLY SYSTEM" herein.

If no book-entry system is in effect with respect to the Series 2011 Bonds, the Series 2011 Bonds will be issuable as fully registered bonds (without coupons), in the denomination of $5,000 or any integral multiple thereof. Principal of and premium (if any) on the Series 2011 Bonds of such series will be payable, at maturity or earlier redemption, at the principal corporate trust office of the Trustee. Interest on the Series 2011 Bonds will be payable by check or draft mailed to the respective registered owners thereof by the Trustee. The Series 2011 Bonds will be subject to optional, extraordinary and sinking fund redemption prior to maturity as set forth herein.

The Series 2011 Bonds will not constitute an obligation or debt of the State of Alabama or any county or other political subdivision thereof.

For Maturity Schedule, see inside cover The Series 2011 Bonds are offered, subject to prior sale, when, as and if issued and received by the Underwriter and subject to

the unqualified approval of the legality thereof by Phelps, Jenkins, Gibson & Fowler, L.L.P., Tuscaloosa, Alabama, Bond Counsel. It is expected that the Series 2011 Bonds in definitive form will be available for delivery through The Depository Trust Company, New York. New York, on or about March 15, 2011.

Joe Jolly & Co., Inc.

March 3, 2011

$10,280,000 GOVERNMENTAL UTILITY SERVICES CORPORATION

OF THE CITY OF ALICEVILLE (ALABAMA) Water and Sewer Taxable Revenue Bonds

(Federal Bureau of Prisons Project)

Maturities, Principal Amounts, Interest Rates and Price or Yield

Maturity

(August 1)

Principal

Interest Rate

Offering Price

Initial Yield

CUSIP

2012 $ 360,000.00 1.75% 100.00 1.75% 016218 AA 7 2013 740,000.00 2.00 99.194 2.35% 016218 AB 5 2014 805,000.00 3.10 100.00 3.10% 016218 AC 3 2015 820,000.00 3.40 98.794 3.70% 016218 AD 1 2016 900,000.00 3.875 98.682 4.15% 016218 AE 9 2017 925,000.00 4.25 98.622 4.50% 016218 AF 6 2018 1,020,000.00 4.50 97.845 4.85% 016218 AG 4 2019 1,060,000.00 4.75 98.300 5.00% 016218 AH 2 2020 1,170,000.00 5.00 98.889 5.15% 016218 AJ 8 2021 2,480,000.00 5.20 99.203 5.30% 016218 AK 5

GOVERNMENTAL UTILITY SERVICES CORPORATION OF THE CITY OF ALICEVILLE (ALABAMA)

Water and Sewer Taxable Revenue Bonds (Federal Bureau of Prisons Project)

Dated: March 1, 2011 Due: August 1, as shown on the inside cover

Series 2011 (Taxable)

No dealer, broker, salesman or other person has been authorized to give any information or to make any representations, other than as contained in this Official Statement, in connection with the offering of the Series 2011 Bonds described herein, and, if given or made such other information or representations must not be relied upon as having been authorized by the GUSC, by the City or by the Underwriter. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series 2011 Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth herein has been furnished by the GUSC and the City and by other sources which are believed to be reliable, but is not guaranteed as to accuracy or completeness, and is not to be construed as a representation by the Underwriter. 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, create any implication that there has been no change in the affairs of the GUSC since the date hereof.

TABLE OF CONTENTS DEFINITIONS ......................................................................................................................................................... 1 THE FINANCING PROGRAM ............................................................................................................................... 3 DESCRIPTION OF THE SERIES 2011 BONDS .................................................................................................... 3 BOOK-ENTRY ONLY SYSTEM ........................................................................................................................... 6 DEBT SERVICE SCHEDULE ................................................................................................................................ 8 CERTAIN BONDHOLDERS' RISKS ..................................................................................................................... 8 THE ISSUER ........................................................................................................................................................... 9 THE FBOP CONTRACT ....................................................................................................................................... 10 THE PROJECT ...................................................................................................................................................... 10 SUMMARIES OF DOCUMENTS......................................................................................................................... 14 THE WATER AND SEWER SERVICES AGREEMENT .................................................................................... 14 THE JOINT PARTICIPATION AGREEMENT .................................................................................................... 14 THE OPERATIONS AND MAINTENANCE AGREEMENT ............................................................................. 14 THE INDENTURE ................................................................................................................................................ 15 TAX EXEMPTION ................................................................................................................................................ 20 LEGAL MATTERS ............................................................................................................................................... 20 NO LITIGATION .................................................................................................................................................. 20 RATINGS ............................................................................................................................................................... 21 UNDERWRITING ................................................................................................................................................. 21 CONTINUING DISCLOSURE UNDERTAKING ................................................................................................ 22 TRUSTEE AND PAYING AGENT ...................................................................................................................... 23 SOURCES OF INFORMATION ........................................................................................................................... 23 CERTIFICATE CONCERNING OFFICIAL STATEMENT ................................................................................ 23

EXHIBIT A – ENGINEER’S PROJECT COST SUMMARY EXHIBIT B – PROJECT STATEMENT OF CASH FLOWS EXHIBIT C – FORM OF LEGAL OPINION

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DEFINITIONS

As used herein the following terms have the meanings as set forth below:

“FBOP” shall mean the United States Federal Bureau of Prisons. “FBOP Contract” shall mean those certain contracts between the United States Federal

Bureau of Prisons and the City of Aliceville pursuant to which the City of Aliceville agreed to provide water and sewer services to the new federal correctional institution based upon the utility services rate schedule set forth therein.

“FCI” shall mean the new federal correctional institution being constructed north of the City

of Aliceville in Pickens County, Alabama. “GUSC” shall mean the Governmental Utility Services Corporation of the City of Aliceville,

an Alabama Public Corporation. “Joint Participation Agreement” shall mean that certain agreement dated December 22, 2010,

between the Governmental Utility Services Corporation of the City of Aliceville, the Water Works and Sewer Board of the City of Aliceville and the City of Aliceville, Alabama setting forth the mutual rights and obligations of the respective parties for the financing, construction, operation and maintenance of the Project.

“Operations and Maintenance Agreement” shall mean that certain agreement dated December

22, 2010 by and between the Governmental Utility Services Corporation of the City of Aliceville and the Water Works and Sewer Board of the City of Aliceville pursuant to which the Water Board has agreed to operate and maintain the water and sewer system serving the new federal correctional institution being constructed in Pickens County, Alabama.

“Project” shall mean the construction of the water and sewer collection and distribution

systems required to service the United States Federal Bureau of Prisons new federal correctional institution located in Pickens County, Alabama.

“Water and Sewer Services Agreement” shall mean that certain agreement dated December

22, 2010, by and between the City of Aliceville, Alabama and the Governmental Utility Services Corporation of the City of Aliceville, pursuant to which the GUSC has agreed to supply water and sewer services to the new federal correctional institution being constructed in Pickens County, Alabama.

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OFFICIAL STATEMENT

GOVERNMENTAL UTILITY SERVICES CORPORATION OF THE CITY OF ALICEVILLE (ALABAMA)

Water and Sewer Taxable Revenue Bonds (Federal Bureau of Prisons Project)

INTRODUCTION

This Official Statement of the Governmental Utility Services Corporation of the City of Aliceville, an Alabama public corporation (the "GUSC"), which includes the cover page and the appendices hereto, is being furnished in connection with the sale by the GUSC of its $10,280,000 aggregate principal amount of Water and Sewer Taxable Revenue Bonds, Series 2011 (the "Series 2011 Bonds"). The Series 2011 Bonds will be issued under a Trust Indenture dated as of March 1, 2011 (the "Indenture"), from the GUSC to The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee") and will be special obligations of the GUSC, payable solely out of payments made by the City of Aliceville, Alabama ("City") under a Water and Sewer Services Agreement dated as of December 22, 2010 (the "Water and Sewer Services Agreement"), between the GUSC and the City. The Series 2011 Bonds will be issued pursuant to the provisions of Chapter 97 of Title 11 of the Code of Alabama 1975.

The information contained in this Official Statement does not purport to be comprehensive or definitive. All references herein to, or summaries of, the Indenture, the Water and Sewer Services Agreement or any contract, resolution or other document or official act related to the Series 2011 Bonds are qualified in their entirety by the exact terms of such documents or official acts, which are items of public record available from the GUSC. All references herein to, or summaries of, the Series 2011 Bonds are qualified in their entirety by the definitive forms thereof and the information with respect thereto included in the Indenture.

SUMMARY

The United States Federal Bureau of Prisons was established in 1930 and today it consists of 116 institutions, 6 regional offices, a Central Office, two (2) staff training centers, and twenty-two (22) community corrections offices. The agency is responsible for the custody and care of approximately 210,000 federal inmates; approximately 82% of these inmates are confined in facilities operated by the Federal Bureau of Prisons.

The United States Federal Bureau of Prisons is locating a women’s federal correctional institution near the City of Aliceville in Pickens County, Alabama. Construction is scheduled to be completed in the summer of 2011. This is a $225,000,000.00 project, and over the course of the next decade, the United States Federal Bureau of Prisons has indicated that two (2) more facilities may be located on the site.

Infrastructure and improvements related to serving the prison facility with water and sewer will be made by the GUSC in cooperation with the Water and Sewer Board of the City of Aliceville. The water and sewer systems are being designed to accommodate the growth expected at the prison facility over the next decade, which could reach up to as many as 1,000 employees and 4,000 inmates.

The scope of the current work for water improvements includes two storage tanks, system pumps, construction of the distribution system and a new well. Sewer improvements include treatment facilities, system pumps and infrastructure, as well as upgrades to the existing system (increased pipe sizes, etc.). The estimated cost for these improvements is approximately $15,000,000.00.

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THE FINANCING PROGRAM

Purposes of the Series 2011 Bonds

The GUSC was incorporated in order to assist the City with the financing of the Project (defined below). The proceeds of the Series 2011 Bonds will be used (i) to fund the construction of the water and sewer collection and distribution system required to service the FBOP’s new FCI located in Pickens County, Alabama (the “Project”), (ii) to fund interest through July 31, 2012, (iii) to fund a debt service reserve and (iv) to pay the expenses of issuing the Series 2011 Bonds.

Estimated Sources and Uses of Funds

The following table sets forth the estimated sources and uses of the moneys to be expended by the GUSC in connection with the issuance of the Series 2011 Bonds (exclusive of accrued interest):

Sources: Principal proceeds of Series 2011 Bonds $10,280,000.00 CIB Discount < 113,227.40> Cash Deposit by GUSC * 6,842,000.00 Accrued Interest 16,793.49

Total Sources: $17,025,566.09

Uses: Deposit to Capitalized Interest Fund** $ 593,308.21

Construction Costs/Deposit to Construction Fund 14,716,659.00 Deposit to Debt Service Reserve Fund 1,430,535.00 Accrued Interest to D/S Fund 16,793.49 Issuance Costs 264,500.00 Rounding Amount 3,770.39

Total Uses: $17,025,566.09

*To be funded from water and sewer connection fees paid by the FBOP **Interest capitalized through July 31, 2012.

DESCRIPTION OF THE SERIES 2011 BONDS

Interest Rates and Maturities

The Series 2011 Bonds will be dated March 1, 2011, and will bear interest at the per annum rates set forth on the inside cover hereof. Interest on the Series 2011 Bonds will be payable on August 1, 2011 and semiannually thereafter on each August 1 and February 1. The Series 2011 Bonds will mature in the principal amounts and on the dates set forth on the inside cover hereof and will be issued in the denomination of $5,000 or any integral multiple thereof. The principal of and the interest on any Series 2011 Bond will bear interest after their respective due dates until paid at the rate of interest borne by the principal of such Series 2011 Bond prior to maturity.

Method of Payment The Series 2011 Bonds will be issued only as fully registered bonds without interest coupons

in the denomination of $5,000 or any integral multiple thereof and will be exchangeable for other fully registered bonds as hereinafter explained under the caption "Registration, Exchange and Replacement". The interest on the Series 2011 Bonds will be paid by the Trustee by draft or check mailed or otherwise delivered to the registered owner, and the principal of and premium (if any) on the Series 2011 Bonds will be paid at the principal corporate trust office of the Trustee upon surrender of the appropriate Series 2011 Bond. The Indenture will provide that the holder of a Series 2011 Bond issued in an initial principal amount of not less than $500,000 may enter into a special payment agreement with the Trustee providing for the payment of the interest thereon and the redemption price

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of any partial redemption of the principal thereof by wire transfer, crediting of bank accounts or other methods of payment, but such special payment agreement shall be subject to the terms and conditions specified in the Indenture. The principal of and the interest and premium (if any) on the Series 2011 Bonds will be payable in lawful money of the United States of America.

Security for the Series 2011 Bonds

General. The Series 2011 Bonds will be special, limited obligations of the GUSC and will be payable solely from and will be secured by a pledge of the receipts to be derived by the GUSC from the sale of water and sewer services to City pursuant to the Water and Sewer Services Agreement or, under certain circumstances, the sale of the Project (except to the extent payable from bond proceeds from income derived from the temporary investment of such proceeds and, under certain circumstances, condemnation and insurance proceeds). The Water and Sewer Services Agreement will obligate City to pay for water and sewer services on a monthly basis in such amounts as are actually supplied to the FCI by the GUSC. Based upon the anticipated usage of the FCI and the rates for water and sewer services established under the Water and Sewer Services Agreement, it is anticipated that monthly revenue to the GUSC will be sufficient to provide for the payment, when due, of the principal of and interest and premium (if any) on the Series 2011 Bonds.

Debt Service Reserve Fund. The Indenture creates a Debt Service Reserve Fund as security for the holders of the Series 2011 Bonds, which will be funded in the amount of $1,430,535.00. Investment earnings on amounts held in the Debt Service Reserve Fund will be payable into the Bond Fund. Moneys on deposit in the Debt Service Reserve Fund are to be used by the Trustee to make up any deficiencies in the Bond Fund and to make a portion of the final debt service payment on the Series 2011 Bonds.

Enforceabilitv of Remedies. The Bonds are payable from the payments to be made under the Water and Sewer Services Agreement and from moneys derived from the enforcement of the Indenture. These and other remedies may, in many respects, require judicial actions, which are often subject to discretion and delay. Under existing law (including particularly the Federal bankruptcy code), the remedies specified in the Indenture may not be readily available or may be limited. A court may decide not to order the specific performance of the covenants contained in the Indenture. The various legal opinions to be delivered concurrently with the delivery of the Series 2011 Bonds will be qualified as to the enforceability of the various legal instruments by limitations imposed by state and federal laws, rulings and decisions affecting remedies and by bankruptcy, reorganization or other laws affecting the enforcement of creditors' rights from time to time in effect.

Limited Obligation. The Series 2011 Bonds will not be general obligations of the GUSC, nor will they in any way constitute a debt or liability of the State of Alabama, the City, or any other political subdivision of such state. None of the Series 2011 Bonds will be payable from any funds other than those pledged for the payment thereof under the Indenture. The GUSC has no taxing power.

Registration, Exchange and Replacement

The Series 2011 Bonds are issuable only as fully registered bonds without interest coupons in the denomination of $5,000 or any integral multiple thereof. The Series 2011 Bonds will be registered as to both principal and interest and will be transferable only on the registry books of the Trustee. The Trustee will be the registrar and transfer agent of the GUSC and will keep at its principal corporate trust office registry and transfer books in which it will note the registration and transfer of the Series 2011 Bonds. The person in whose name any Series 2011 Bond is registered on the books of the Trustee will be considered the absolute owner thereof for all purposes and will be the sole person to whom payments of principal of and interest and premium (if any) will be made. No transfer of any Series 2011 Bonds will be valid except upon presentation and surrender of such Series 2011 Bond at the principal corporate trust office of the Trustee with written power to transfer signed by the registered owner in person or by duly authorized attorney. Upon the proper transfer of any Series 2011 Bond the GUSC will execute a new Series 2011 Bond, and the Trustee will deliver to the transferee such new Series 2011 Bond registered in the name of such transferee. Any Series 2011 Bond may be exchanged for an equal aggregate principal amount of other Series 2011 Bonds that have the same maturity and interest rate, all as may be requested

5

by the holder surrendering the Series 2011 Bonds to be so exchanged and upon the terms and conditions provided in the Indenture.

In every case involving any transfer, registration or exchange of any of the Series 2011 Bonds, the holder thereof shall be responsible for paying all taxes and other government charges relating to such transfer, registration or exchange. In the event any Series 2011 Bond is lost, stolen destroyed or mutilated, the GUSC and the Trustee may require satisfactory indemnification for the replacement thereof and may charge the holder of such bond with their fees and expenses in connection with the replacement thereof.

Redemption Provisions

The Series 2011 Bonds will not be subject to redemption prior to their respective maturities, except as described below in the paragraphs captioned "Optional Redemption of Series 2011 Bonds" and “Extraordinary Redemption”.

Optional Redemption of Series 2011 Bonds. The Series 2011 Bonds will be subject to

redemption, at the option of the GUSC as a whole on February 1, 2021, and on any date thereafter, such redemption to be at and for a redemption price equal to the principal amount to be redeemed plus accrued interest thereon to the redemption date.

Extraordinary Redemption. The Series 2011 Bonds will be subject to mandatory redemption prior to their stated maturity as a whole on any date, at and for a redemption price equal to the principal amount thereof plus accrued interest thereon to the redemption date upon the occurrence of any of the following events:

(a) the Project or any part thereof is damaged or destroyed, by fire or other casualty, to such extent that, in the opinion of the Board of Directors of City expressed in a resolution filed with the GUSC and the Trustee, the restoration or repair of the property damaged or destroyed would not be economically practicable or desirable;

(b) under the exercise of the power of eminent domain by any governmental authority or person, firm or corporation acting under governmental authority, (i) title to all or substantially all the Project is taken, or (ii) the temporary use of all of the Project, or title to part of the Project, is taken to such extent that, in the opinion of the Board of Directors of City expressed in a resolution filed with the GUSC and the Trustee, City will thereby be prevented, or is likely to be thereby prevented, from receiving normal service from the Project;

(c) as a result of any changes in the Constitution of the State of Alabama or the Constitution of the United States of America or of legislative or administration action (whether local, state or federal) or any final decree, judgment or order of any court or administrative body (whether local, state or federal), entered after the contest thereof by City in good faith, the Water and Sewer Services Agreement becomes void or unenforceable or impossible of performance in accordance with the intent and purposes of the parties as expressed therein, or unreasonable burdens or excessive liabilities are imposed on the GUSC or City, including, without limitation, any changes in federal or state tax laws that will render the operation of the Project significantly less advantageous economically to City; or

(d) service from the Project to City is legally curtailed for any reason other than the circumstances or conditions described in the preceding clauses (b) and (c).

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Notice of Redemption of Series 2011 Bonds

Notice of the proposed redemption of any of the Series 2011 Bonds prior to their stated maturity will be given, not more than sixty (60) nor less than thirty (30) days prior to the proposed redemption date, by registered or certified mail to the registered holders of any Series 2011 Bonds called for redemption at the address of each such holder as such address appears on the registry books of the Trustee pertaining to the registration of the Bonds. If on the applicable redemption date the redemption price of any Series 2011 Bond (or portion thereof) duly called for redemption is on deposit at the principal office of the Trustee, such bond (or portion thereof) will cease to bear interest on such date.

Additional Bonds

The Indenture will permit the GUSC from time to time, if it is not in default thereunder and if City is not in default under the Water and Sewer Services Agreement and all required deposits to all funds created under the Indenture are current, to issue additional bonds ("Additional Bonds") without limitation as to principal amount upon compliance with the conditions contained in the Indenture; and all the Additional Bonds shall be secured on a parity of lien with the Series 2011 Bonds and all other Bonds at any time issued under the Indenture. Additional Bonds may be issued for the purpose of (i) obtaining funds to pay the costs of making improvements to the Project, (ii) refunding or otherwise retiring all or any portion of any one of more series of Bonds then outstanding under the Indenture, or (iii) any combination of the preceding purposes.

Among the conditions precedent to the issuance of Additional Bonds will be the execution of a supplemental indenture between the GUSC and the Trustee providing for and describing such Additional Bonds and, among other things, requiring that there be a contract in place with the FBOP which establishes water and sewer utility rates that are sufficient to provide for the payment of principal and interest on the Additional Bonds, which contract shall be similar in nature to the current FBOP Contract.

BOOK-ENTRY ONLY SYSTEM

The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the Series 2011 Bonds (the "Securities"). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC's 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 maturity of the Securities, each in the aggregate principal amount of such maturity, and will be deposited with DTC.

DTC, the world's largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "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 DTC's 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

7

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 Standard & Poor's highest rating: AAA. 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 and www.dtc.org.

Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC's 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.

To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of 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; DTC's 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 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 a maturity are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such maturity 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 DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to 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. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from Issuer (i.e., the GUSC) or Agent (i.e., the Trustee), on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and

8

will be the responsibility of such Participant and not of DTC, Agent, or Issuer, 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 Issuer or Agent, 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.

A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant, to Agent, and shall effect delivery of such Securities by causing the Direct Participant to transfer the Participant's interest in the Securities, on DTC's records, to Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC's records and followed by a book-entry credit of tendered Securities to Agent's DTC account.

DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered.

Issuer 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 DTC's book-entry system has been obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy thereof.

DEBT SERVICE SCHEDULE

The following table sets forth the amounts required to be made available in each year ending August 1, for payment of the debt service on the Series 2011 Bonds and shows the total of such debt service requirements for each such year:

Bond Year Ending

Principal of the Series 2011

Bonds

Coupon Rates

Interest on the Series 2011 Bonds

Total Debt Service

2011 $179,930.21 $ 179,930.21 2012 $360,000.00 1.75% 431,832.50 791,832.50 2013 740,000.00 2.00 425,532.50 1,165,532.50 2014 805,000.00 3.10 410,732.50 1,215,732.50 2015 820,000.00 3.40 385,777.50 1,205,777.50 2016 900,000.00 3.875 357,897.50 1,257,897.50 2017 925,000.00 4.25 323,022.50 1,248,022.50 2018

1,020,000.00 4.50 283,710.00 1,303,710.00

2019 1,060,000.00 4.75 237,810,00 1,297,810.00 2020 1,170,000.00 5.00 187,460.00 1,357,460.00 2021 *2,480,000.00 5.20 128,960.00 2,608,960.00

*Proceeds of Debt Service Reserve Fund to be applied to final principal payment of Series 2011 Bonds

CERTAIN BONDHOLDERS' RISKS

Summarized below are a number of risks that could adversely affect the operation of the Project or the timely payment of the principal of and the interest and premium (if any) on Series 2011 Bonds and that should be considered by prospective investors. The following discussion is not intended to be exhaustive, but includes certain major risk factors that should be considered along with other risk factors set forth elsewhere in this Official Statement, including the Appendices hereto.

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Limited Obligations

The Series 2011 Bonds are limited obligations of the GUSC, payable solely from payments to be made by City pursuant to the Water and Sewer Services Agreement. No assurance may be given that the Project will generate sufficient funds to satisfy the obligations to the holders of the Series 2011 Bonds. The GUSC has no appreciable assets other than its interest in the Project.

Unique Nature of the Project

The Project is not practically suited to alternative uses. As a result, in the event of a default with respect to the payment of principal of and interest and premium (if any) on the Series 2011 Bonds, the realization of revenues from sale or leasing of the Project might thus be adversely affected.

Investment Risks

There can be no assurance that there will always be a secondary market for purchase or sale of the Series 2011 Bonds, and from time to time there may be no market for them depending upon prevailing market conditions, the financial condition or market position of firms who may make the secondary market and the financial condition and results of operations of City. The Series 2011 Bonds should therefore be considered long-term investments in which funds are committed to maturity.

General Although the decision to enter into the Water and Sewer Services Agreement was based upon

assumptions and business judgments that GUSC believes are reasonable and appropriate, the success of the Project is subject to conditions that may change in the future to an extent that cannot be presently determined. The realization of assumptions made by GUSC are subject to the capabilities of GUSC's management and to future economic and other conditions that are unpredictable and that may adversely affect revenues and payments of principal of and interest on the Series 2011 Bonds. These include inability to control expenses in a period of inflation and restrictions on rates that GUSC may charge to its water customers.

Taxation of Interest on Series 2011 Bonds

An opinion of Bond Counsel will be obtained to the effect that, under the conditions stated therein (and subject to the matters discussed in the following paragraphs), interest earned on the Series 2011 Bonds will be exempt from taxation in the State of Alabama under current statutes, but will not be excludible from gross income of the holders of the Series 2011 Bonds under existing federal income tax statutes and applicable regulations and rulings of the Internal Revenue Service.

THE ISSUER

The Governmental Utility Services Corporation of the City of Aliceville (the "GUSC") is a public corporation and instrumentality organized and existing under the laws of the State of Alabama, particularly the Act, and a resolution adopted by the governing body of the City, authorizing its incorporation. The general purpose of the GUSC is the promotion of the health, welfare and safety of the people of Alabama by the financing of utility service facilities in the State of Alabama. The powers of the GUSC are exercised by a three-member Board of Directors consisting of residents of the City who are appointed by the governing body of the City.

The Series 2011 Bonds do not constitute an indebtedness of the City, and the City is in no way

obligated for payment of the principal of or the interest and premium (if any) on the Series 2011 Bonds. No holder of the Series 2011 Bonds shall have the right to compel any exercise of the taxing power of the City to pay the Series 2011 Bonds or any interest thereon. Further, the GUSC has no taxing power and the Series 2011 Bonds are special obligations of the GUSC payable solely from the water and sewer fees and other receipts payable to the GUSC from or on account of the Project. The GUSC has issued no bonds heretofore and has no other outstanding indebtedness.

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THE FBOP CONTRACT

On or about September 2009 the FBOP awarded the City contracts for the construction, installation operation and maintenance of water and sewer services facilities by which the City is to provide water and sewer service to the new FCI located in Pickens County, Alabama. The water service facilities shall provide water to the FCI at a minimum rate of 355,000 gallons average daily usage and 129,575,000 gallons average annual usage. The sewer service facilities shall provide sewer services to the FCI at a minimum rate of 300,000 gallons average daily usage and 109,500,000 gallons average annual usage. The terms of the contracts are ten (10) years each, which said terms shall begin on the date of substantial completion of the Project, currently estimated to be August 2011. The FBOP shall pay to the City a connection fee in the amounts of $3,355,500.00 for water service and $3,486,500.00 for sewer service, to be paid in increments, with final payment due and payable to the City upon substantial completion of the construction and installation of the water system facilities. For the duration of the term of the contract, the FBOP shall pay to the City an escalating rate which shall begin at substantial completion at $6.32 per water unit and incrementally increase over the ten (10) year term to $7.39 per water unit in the final year of the term and which shall begin at $5.50 per sewer unit and incrementally increase over the ten (10) year term to $6.37 per sewer unit in the final year of the term. The contract reserves the right for the regulatory body governing the water and sewer rates (i.e. GUSC) to increase or decrease the aforementioned rates as necessary. The FBOP agrees to accept any change in rate as of the effective date of the change, so long as the rate is not in excess of the lowest rate published or unpublished to any other customers of the same class under similar conditions of use and service.

THE PROJECT

The United States Federal Bureau of Prisons (“FBOP”) is locating a new federal correctional institution (“FCI”) in Pickens County, Alabama. Pursuant to the terms of the City’s contract with the FBOP (the “FBOP Contract”), the City is obligated to provide water and sewer service to the FCI. In order to fulfill its obligations under the FBOP Contract, the City has entered into the Water and Sewer Services Agreement with the GUSC, pursuant to the terms of which the GUSC will finance and construct the water and sanitary sewer system necessary to serve the FCI. The Water Works and Sewer Board of the City of Aliceville (the “Water Board”) has entered into an agreement with the City and the GUSC to operate and maintain the water and sewer system serving the FCI. The FCI, which will be staffed by 330 employees and house 1,500 women inmates, is currently under construction. Construction of the FCI began on or about September 8, 2008 and is anticipated to be completed on August 1, 2011, and reach full operational capacity with respect to its inmate population within 8 to 12 weeks thereinafter. The water and sewer system for the FCI is being designed to accommodate future growth, which may reach up to 1,000 employees and 4,000 inmates over the next ten years. The initial system improvements will consist of approximately $15,000,000 of infrastructure improvements, including two water storage tanks, booster pump stations, ground water supply distribution system, sanitary sewer collection system and waste water treatment facilities.

Estimated Project Cost

Water Improvements $7,927,259 Sewer Improvements 6,289,400 Contingency Funds 500,000 Total: $14,716,659

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As of December 15, 2010, over 80% of the estimated Project cost has been bid and construction contracts issued. McGiffert and Associates, LLC has acted as the civil engineer for the Project overseeing the bidding process and the awarding of bids. A Project Cost Summary dated December 15, 2010 is set forth on Exhibit “A” and sets forth in detail the extent to which each phase of the Project has been bid and its percentage of completion.

The infrastructure improvements will be funded through approximately $7,000,000 of water and sewer connection fees paid by the FBOP and from the proceeds of the Series 2011 Bonds. As of December 31, 2010 the GUSC has received 50% of the connection fees from the FBOP, with the balance to be paid out in installments as progress payments as the Project moves toward completion. The City, the Water Board and the GUSC have entered into a Joint Participation Agreement which sets forth the rights and obligations of the respective parties. The GUSC will supply water and sewer services (on behalf of the City) to the FCI. The Water Board will operate and maintain the water and sewer system once it has been constructed. The FBOP will pay for the water and sewer services utilized by the FCI on a monthly basis, at the rates established in the FBOP Contract. It is anticipated that based on the water and sewer rates established under the FBOP Contract and the estimated amount of water and sewer usage at the FCI (which is set forth below), the GUSC will receive sufficient revenue to provide for the payment, when due, of the principal of and interest on the Series 2011 Bonds, as well as to provide for payments into the Debt Service Reserve Fund created in the Indenture.

The water service charges to be paid by the FBOP are based on estimated water service

requirements as follows: 355,000 gallons average daily usage; estimated 129,575,000 gallons of water on an annual basis. The sewer service charge to be paid by the FBOP is based on estimated sewer service requirements as follows: 300,000 gallons average daily usage. Estimated 109,500,000 gallons discharged on an annual basis.

The following is the estimated revenue to be derived from the sale of water to the FCI and the disposal of sewerage from the FCI:

Bond Year

Ending July 31

Water Usage

(Gallons)

Water Unit Price

Gross Water

Revenue

Sewer Usage

(Gallons)

Sewer Unit Price

Gross Sewer

Revenue

Total Gross

Revenue

2012* 86,383.33 $ 6.32 $545,942.67 73,000.00 $5.50 $401,500.00 $ 947,442.67 2013 129,575.00 6.32 818,914.00 109,500.00 5.50 602,250.00 1,421,164.00 2014 129,575.00 6.57 851,307.75 109,500.00 5.71 625,245.00 1,476,552.75 2015 129,575.00 6.57 851,307.75 109,500.00 5.71 625,245.00 1,476,552.75 2016 129,575.00 6.83 884,997.25 109,500.00 5.92 648,240.00 1,533,237.25 2017 129,575.00 6.83 884,997.25 109,500.00 5.92 648,240.00 1,533,237.25 2018

129,575.00 7.10 919,982.50 109,500.00 6.14 672,330.00 1,592,312.50

2019 129,575.00 7.10 919,982.50 109,500.00 6.14 672,330.00 1,592,312.50 2020 129,575.00 7.39 957,559.25 109,500.00 6.37 697,515.00 1,655,074.25 2021 129,575.00 7.39 957,559.25 109,500.00 6.37 697,515.00 1,655,074.25

*Includes estimated revenue from September 1, 2011 through July 31, 2012

The GUSC will contract with the Water Board to operate and maintain the water and sewer system improvements for the FCI. Based upon the contract between the GUSC and the Water Board, the GUSC will reimburse the Water Board for all expenses of operating and maintaining the water and sewer system for the FCI. In addition, the Water Board will receive a management fee for performing its obligations under the operation and maintenance contract. At the end of the term of the Joint Participation Agreement between the Water Board, the GUSC and the City, the GUSC will transfer its assets, including the water and sewer system serving the FCI as well as any reserve funds, to the Water Board.

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The following is based upon the projections of McGiffert and Associates, LLC, civil engineers and sets forth the estimated net revenue available for debt service on the Series 2011 Bonds along with the estimated debt service requirements for each year: Bond Year

Ending July 31

Total Gross

Revenue

Water Expense

(3% Inflation)

Sewer Expense

(3% Inflation)

Available For Debt Service

Estimated Debt

Service 2011 2012 $947,442.67 $38,333.33

$ 81,666.67

$827,442.67

*$ 355,000.00

2013 1,421,164.00 59,225.00 126,175.00 1,235,764.00 1,145,642.50 2014 1,476,552.75 61,001.75 129,960.25 1,285,590.75 1,199,327.50 2015 1,476,552.75 62,831.80 133,859.06 1,279,861.89 1,189,452.50 2016 1,533,237.25 64,716.76 137,874.83 1,330,645.66

1,240,705.00

2017 1,533,237.25 66,658.26 142,011.07 1,324,567.92 1,235,785.00 2018

1,592,312.50 68,658.01 146,271.41 1,377,383.09 1,291,870.00

2019 1,592,312.50 70,717.75 150,659.55 1,370,935.20 1,280,370.00 2020 1,655,074.25 72,839.28 155,179.33 1,427,055.64 1,334,655.00 2021 1,655,074.25 75,024.46 159,834.72 1,420,215.08 2,700,945.00 2022

*interest capitalized through July 31, 2012 Harbin & Stough, PC, certified public accountants, have compiled a Projected Statement of Cash Flows for the Project for the periods September 1, 2011 through August 1, 2021, such report being set forth in Exhibit “B” attached hereto.

CERTAIN GENERAL INFORMATION RESPECTING THE CITY AND THE SERVICE AREA

General

The City is located in west central Alabama in close proximity to the Alabama/Mississippi state line. Situated in southern Pickens County, the City is 30 miles southeast of Columbus, Mississippi, 45 miles west of Tuscaloosa, Alabama, and 100 miles west of Birmingham, Alabama. The City was founded in 1902 and incorporated in 1907.

The county seat of Pickens County is the town of Carrollton, located approximately 10 miles north of the City with a population of 1,170.

Agriculture is the primary industry of the City area and pumps in excess of $44 million into the local economy annually. There are approximately 106,000 acres of farmland in Pickens County. Major agricultural products include cotton, wheat, soybeans, corn, hay and grain sorghum.

Also important to the area is forestry and forestry-related industry. Among the 67 Alabama counties, Pickens County ranks in the top 20% in the production of hardwood lumber and in the production of pine lumber. Of the 567,997 acres in Pickens County, approximately 76.9% is composed of forest, 18.4% is devoted to agricultural use, .6% constitutes urban area and 4.9% of such acreage is devoted to other uses.

The City is governed by a mayor and five member council elected at large every four years. The City is a member of the Alabama League of Municipalities and has an active Planning Commission.

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Population

The population of the City and Pickens County is shown below:

Year Aliceville Pickens County 2000 2,567 20,949 1990 3,009 20.699 1980 3.207 21.481 1970 2,851 20,326 Assessed Values

The net assessed valuation of taxable property in Pickens County has been as follows for the fiscal years indicated:

Net Taxable Year Assessed Value 2009 $116,404,760 2008 $114,386,350 2007 $111,287,930 2006 $97,640,596 2005 $95,370,016 Source: Revenue Commissioner of Pickens County Major Manufacturing Employers-Pickens County

EMPLOYER PRODUCT EMPLOYEES Pickens Co. Board of Education Education 481 Peco Farms, Inc. Poultry Foods 156 Buchanan Harwood Flooring Dimension Hardwood 150 Buchanan Lumber Company Sawmill 75 Lewis Brothers Lumber Lumber 75 McShan Lumber Pine Lumber 60 Pate Lumber Company Sawmill (Pine) 49 McGee Lumber Sawed Lumber 58 Alabama Casting Company Ductile Iron Casting 45

Source: West Alabama Regional Commission

Transportation

Highways. The City is located on two intersecting Alabama highways. Alabama Highway 17 is the north-south route connecting 20 miles north with U.S. Highway 82 and 48 miles south with Interstate 20/59. Alabama Highway 14 runs northwest and connects with Interstate 20/59.26 miles southeast of the City.

Water. The City is located five miles from the Tennessee-Tombigbee Waterway, a link

between the Tennessee and Tombigbee Rivers which provides a route from 16,000 miles of inland waterways to ports along the southeastern Gulf of Mexico.

Other. Commercial air transportation needs are served by the City of Tuscaloosa Municipal Airport, Tuscaloosa, Alabama, approximately 45 miles east of the City, and Golden Triangle Airport, Columbus, Mississippi, approximately 30 miles west of the City. Five interstate motor freight carriers

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serve the City and provide daily or individual scheduled pick-up and delivery service. Rail service in the City is provided by The Burlington-Northern Rail System.

Education

The City is within 50 miles of several institutions of higher education, including the University of Alabama in Tuscaloosa and Mississippi State University in Starkville. The City is served by the Pickens County school system, consisting of an elementary school, a junior high school and a high school. There is also one vocational-technical school serving the City.

SUMMARIES OF DOCUMENTS

The following portion of this Official Statement contains summaries of certain provisions of the Water and Sewer Services Agreement, the Joint Participation Agreement, the Operations and Maintenance Agreement and the Indenture. Such summaries do not purport to be complete descriptions and contain only brief outlines of the terms and provisions of such documents. The summaries are qualified in their entirety by reference to such documents, all of which will be available for inspection at the offices of the Trustee. Any reference to the "Bonds" shall be construed to mean not only the Series 2011 Bonds but also (unless the context clearly indicates otherwise) any Additional Bonds that may then be outstanding. See "Additional Bonds" under "THE SERIES 2011 BONDS".

THE WATER AND SEWER SERVICES AGREEMENT

The term of the Water and Sewer Services Agreement will begin upon completion of the FCI and will continue until the payment of all Indenture Indebtedness (as hereafter defined). For purposes of this paragraph, the term "Indenture Indebtedness" means all indebtedness of the GUSC at the time secured by the Indenture, including, without limitation, (i) all principal of and interest and premium (if any) on the Bonds, (ii) all reasonable and proper fees, charges and disbursements of the Trustee for services performed under the Indenture and all expenses incurred by the Trustee pursuant to the applicable provisions of the Indenture.

The Water and Sewer Services Agreement will obligate the City to pay the GUSC, on a

monthly basis, an amount equal to the water and sewer charges assessed to and paid by the FBOP for water and sewer services utilized by the FCI in the previous month.

THE JOINT PARTICIPATION AGREEMENT

On or about December 22, 2010, the GUSC, the City and the Water Board entered into a Joint Participation Agreement which memorializes the respective obligations of the parties for the financing, construction, operation and maintenance of the Project. Pursuant to the terms of the agreement, the GUSC will provide the necessary financing for the Project through the issuance of the Series 2011 Bonds. The Water Board will oversee and coordinate the construction of the Project, and once completed, will provide for the operation and maintenance of the Project through a separate agreement. The City will fulfill its obligation to provide water and sewer services to the FCI by entering into the Water and Sewer Services Agreement with the GUSC, the terms of which are set forth above.

THE OPERATIONS AND MAINTENANCE AGREEMENT

On or about December 15, 2010, the GUSC entered into an agreement with the Water Board whereby the Water Board agreed to provide the operations and maintenance necessary for the Project once construction was completed. The Water Board will receive a monthly management fee to provide such services. The initial management fee will be $14,400 per year, increasing annually until year ten of the agreement, at which time the management fee shall be $33,200. In addition, the GUSC shall

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reimburse the Water Board for the Water Board’s actual cost incurred in operating and maintaining the Project.

THE INDENTURE

The following constitutes a summary of certain provisions of the Indenture pursuant to which the Series 2011 and any Additional Bonds will be issued. This summary should be qualified by reference to other provisions of the Indenture referred to elsewhere in this Official Statement, and all references and summaries pertaining to the Indenture in this Official Statement are, separately and in whole, qualified by reference to the exact terms of the Indenture, a copy of which may be obtained from the GUSC. Unless the context clearly indicates otherwise, all reference herein to the "Bonds" shall mean the Series 2011 Bonds and any Additional Bonds that may hereafter be issued.

Definitions

“Annual Debt Service Requirement” means, as of any time, the amount of principal maturing and interest becoming due with respect to the then outstanding Bonds in a Bond Year; provided, that the principal amount of any Bonds subject to a Mandatory Redemption Requirement during such Bond Year shall, for purposes of this definition, be considered as maturing in the Bond Year during which such redemption is required and not in the Bond Year in which their stated maturity occurs.

"Bond Year" means the period commencing on August 1 of one calendar year and ending on July 31 of the then next succeeding calendar year.

“Construction Fund” means the Construction Fund created in the Indenture.

"Eligible Certificates" means interest bearing certificates of deposit that are issued (l) by the Trustee, or (2) by any bank or trust company organized under the laws of the United States of America or any state thereof that are collaterally secured by a pledge of Federal Securities (a) having at any date of calculation a market value (taking account of any accrued interest thereon) not less than the principal of and the accrued interest on the certificates of deposit secured thereby, (b) deposited and pledged with any Federal Reserve Banker with any bank or trust company organized under the laws of the United States of America or any state thereof, and having combined capital, surplus and undivided profits of not less than $10,000,000, and (c) for which a receipt signed by the bank or trust company having custody of such collateral securities and containing a sufficient description thereof has been furnished to the Trustee.

“Eligible Investments” means Eligible Certificates, Federal Securities, or any money market fund whose investments are restricted to investments of the kind defined as Federal Securities.

"Federal Securities" means any securities that are direct obligations of the United States of America and any securities with respect to which payment of the principal thereof and the interest thereon is unconditionally guaranteed by the United States of America.

"Fiscal Year" means the period beginning on October 1 of one calendar year and ending on September 30 of the next succeeding calendar year.

"Independent Auditor" means a certified public accountant, or firm thereof, not employed full time by the GUSC and regularly engaged in the auditing of financial records.

"Independent Engineer" means an engineer who is duly registered and qualified to practice the profession of engineering under the laws of Alabama and who is not a full time employee of the GUSC.

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"Mandatory Redemption Requirement" means any provision that may be set forth in the Indenture or in a Supplemental Indenture for mandatory redemption of any Bonds at a redemption price equal to the principal amount thereof.

"Operating Expenses" means, for the applicable period or periods, the reasonable and necessary expenses of efficiently and economically administering and operating the Project and in maintaining in good repair and operating condition (not including, however, depreciation, interest, payments into any of the special funds created in the Indenture or any expenses for items properly chargeable by generally accepted accounting principles to fixed capital account), the fees and expenses of the Trustee under the Indenture, and any other charges expressly stated in the Indenture to constitute an operating expense.

Construction Fund

The Indenture creates a Construction Fund for the purpose of providing funds for payments of Project costs and for the payment of the expenses incurred in connection with the issuance and sale of the Series 2011 Bonds. Monies deposited into the Construction Fund shall be expended for Project costs upon proper requisition being submitted to and verified by the Trustee. Any monies remaining in the Construction Fund upon completion of the Project shall be transferred to the Bond Fund.

Application of Revenues and Flow of Funds

General. The Indenture creates (in addition to the Construction Fund referred to above) two other funds, the Bond Fund and the Reserve Fund. The Trustee is irrevocably designated as the depository, custodian and disbursing agent for the Construction Fund, the Bond Fund and the Reserve Fund.

Bond Fund. On or prior to the first day of each month the GUSC is required to transfer to the Bond Fund an amount equal to one-sixth of the semiannual installment of interest that will mature with respect to the Bonds on the then next succeeding interest payment date plus one-twelfth of the principal, if any, on the Bonds that will mature or that are subject to mandatory redemption on the then next succeeding August 1. Moneys on deposit in the Bond Fund are to be used only for the payment of the principal of and interest on the Bonds.

Reserve Fund. Contemporaneously with the delivery of the Series 2011 Bonds, the GUSC will deposit into the Reserve Fund an amount equal to $1,430,535.00 Moneys forming a part of the Reserve Fund are to be held as a reserve for the payment of the principal of and interest on the Bonds, but shall be used for such purpose only when necessary to prevent a default. Whenever the Reserve Fund balance exceeds $1,430,535.00 in the then current and any subsequent fiscal year, the Trustee shall, on each February 1 and August 1, transfer such excess amounts to the Bond Fund.

Surplus Funds Account. The GUSC shall establish and maintain a separate bank account which shall be titled in the name of the GUSC and called the “Surplus Funds Account”. After providing for the monthly payments to the Bond Fund and the Reserve Fund (if applicable), as well as providing for the payment of Operating Expenses for the Project, the GUSC shall transfer any excess cash into the Surplus Funds Account. Monies in the Surplus Funds Account may only be withdrawn by resolution of the GUSC Board of Directors, and shall be used only for capital expenditures related to the Project or the expansion thereof for additional correction facilities.

Investment of Funds. Any or all of the moneys on deposit in the Bond Fund and the Reserve Fund that the GUSC determines shall not be needed for the purpose for which such funds were respectively created may be invested in Eligible Investments. Interest earned on investments in the Bond Fund and the Reserve Fund will be retained in the respective funds except that interest earnings in the Reserve Fund shall be transferred (on each February 1 and August 1) to the Bond Fund if the

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Reserve Fund is at the time fully funded.

Annual Audits. The GUSC will within ninety days following the close of each Fiscal Year cause an audit of its books for such Fiscal Year to be made by an Independent Auditor. Within ten days following the receipt of such audit, the GUSC will furnish a copy thereof to the Trustee, to the holder of any of the Bonds who makes written request therefor, and to the original purchaser or purchasers of each series of the Bonds. In the event the audit required is not furnished within 120 days following the close of any Fiscal Year, the Trustee may, at the expiration of such period, employ an Independent Auditor to make the audit for such Fiscal Year.

No Free Service. The GUSC will not furnish or permit to be furnished by or from the Project any free service of any kind to the City or to any county or incorporated municipality or to any person whatsoever.

Priority of Pledge. The pledge of revenues from the operation of the Project shall be prior and

superior to any pledge thereof hereafter made for the benefit of any securities hereafter issued or any contract hereafter made by the GUSC other than any of the Additional Bonds.

Rate Covenant. The GUSC will covenant to maintain water and sewer rates at sufficient levels

to cover the payment of debt service on the Series 2011 Bonds as well as operations and maintenance expenses and any funded reserves.

Continued Operation of the Project. The GUSC will not sell or lease the whole or any integral part of the Project, will continuously operate the Project or cause the same to be operated, and will keep the Project in good repair and efficient operating condition. The GUSC may however consolidate with or merge into any public corporation, or transfer the Project as an entirety to the City or to another public corporation if the property or income of such other public corporation is not subject to taxation and, upon such consolidation, merger or transfer, the due and punctual payment of the principal of and interest on the Bonds and the observance of the agreements of the Indenture are expressly assumed in writing by the corporation formed by such consolidation into which such merger shall be made or to which the Project shall be transferred as an entirety.

Insurance Insurance Required. The GUSC will keep all portions of the Project that are of the character

and type customarily insured by organizations operating a business similar to the Project insured against loss by fire, including extended coverage, tornado and windstorm, to the extent of the full insurable value thereof. The GUSC will also carry workmen's compensation insurance and public liability insurance in such amounts and to such extent as is customarily carried by like organizations engaged in like businesses of comparable size.

Disposition of Insurance Proceeds. Insurance proceeds on physical properties coming into the hands of the Trustee shall be applied by the Trustee, at the direction of the GUSC, for one of the following purposes: (a) purchase or construction of additional property of utility equal to that destroyed; or (b) repairing or renewing of the property damaged or destroyed; provided, that the Trustee may pay such proceeds to the GUSC upon being furnished with certificates of an Independent Engineer stating (1) that additional property described in the certificate has been purchased or constructed by the GUSC and is of equal utility in the operation of the Project to the property damaged or destroyed or (2) that the property damaged or destroyed has been repaired in a workmanlike manner satisfactory to such engineer.

Events of Default and Remedies

Events of Default. The following constitute default under the Indenture:

(a) Failure by the GUSC to pay the principal of and interest on any of the Bonds when such principal and interest respectively become due and payable, whether at maturity, by

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mandatory redemption or otherwise; (b) Failure by the GUSC to commence the repair or replacement of any property

forming a part of the Project that may be damaged or destroyed and that is necessary to the continued and efficient operation of the Project, within one hundred twenty days after the occurrence of such damage or destruction;

(c) The sale, lease or other disposition by the GUSC of the Project or any integral

part thereof in violation of any provisions of the Indenture; (d) Failure by the GUSC to perform any of the agreements on its part contained in the

Indenture (other than as provided in (a), (b) and (c) above) after thirty (30) days' written notice to it of such failure made by the Trustee or by the holders of 25% of the Bonds; or

(e) Determination by a court having jurisdiction that the GUSC is insolvent or

bankrupt, or appointment by a court having jurisdiction of a receiver for the Project or for a substantial part thereof, or approval by a court of competent jurisdiction of any petition for reorganization of the Project or rearrangement or readjustment of the obligations of the GUSC under any provisions of the bankruptcy laws of the United States.

Remedies on Default. Upon the occurrence of default, the Trustee shall, subject to the provisions of the next succeeding paragraph, have the following rights and remedies:

(a) Acceleration. The Trustee may, by written notice to the GUSC, declare the principal of all the Bonds forthwith due and payable, and thereupon they shall so be, anything in the Indenture or in the Bonds to the contrary notwithstanding. If, however, the GUSC shall thereafter make good that default and every other default under the Indenture (except payment of the principal so declared payable), with interest on all overdue payments of principal and interest, and make reimbursement of all the expense of the Trustee, then the Trustee may (and if requested by the holders of a majority in principal amount of the Bonds then outstanding shall) waive such default and its consequences, but no such waiver shall affect any subsequent default or right relative thereto.

(b) Suits at Law or in Equity. The Trustee is empowered (1) to sue on the Bonds, (2) by mandamus, suit, or other proceedings to enforce all agreements of the GUSC in the Indenture, including the fixing of rates and the collection, proper segregation and proper application of the revenues from the Project, (3) by action or suit in equity, to require the GUSC to account as if it were the trustee of an express trust for the bondholders and (4) by action or suit in equity, to enjoin any act or things which may be unlawful or in violation of the rights of the bondholders.

(c) Receivership. The Trustee shall be entitled to and shall have, regardless of the sufficiency of any security or the availability of any other remedy, the appointment of a receiver to administer and operate the Project and perform the covenants on the part of the GUSC contained in the Indenture. Any receiver so appointed shall be entitled to take over and administer all of the following then on hand which shall be applicable to the Project: cash on hand or on deposit, accounts and notes receivable, stocks, evidences of indebtedness, choses in action, customers' service and extension deposits, water and other property held for sale in the ordinary course of business or for consumption in the operation of the Project.

Remedies Vested in Trustee for Benefit of Bondholders. All remedies under the Indenture are vested exclusively in the Trustee for the equal and pro rata benefit of all holders of the Bonds, unless the Trustee refuses or neglects to act within a reasonable time after written request so to act addressed to the Trustee by the holders of twenty-five per centum (25%) of the Bonds, accompanied by indemnity satisfactory to the Trustee, in which event the holder of any of the Bonds may thereupon so act in the name and behalf of the Trustee or may so act in his own name and behalf in lieu of action by or in the name and behalf of the Trustee. Except as provided in the preceding sentence, no holder of any of the Bonds shall have the right to enforce any remedy under the Indenture, and then only for the equal and pro rata benefit of the holders of all the Bonds.

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Concerning the Trustee

Conditions to Acceptance of Trust. Among the conditions to the acceptance of the trust of the Indenture, are the following: (a) that the Trustee shall not be answerable for anything whatever in connection with the trust thereby created, except its willful misconduct or gross negligence; (b) that in the event of default by the GUSC, the Trustee need not exercise any of the rights or powers therein specified unless requested so to do in writing by the holders of 25 % of the Bonds provided that the furnishing of indemnity satisfactory to the Trustee against prospective expenses and liabilities of the Trustee by the holders requesting any action shall be a condition to the duty of the Trustee to take such action; and (c) any action taken by the Trustee at the request of and with the consent of a holder of a bond will bind all subsequent holders of the same bond or any bond issued in lieu thereof.

Payment of Prior Charges. The Trustee may pay any charge which the failure of the GUSC to pay has made or will make an encumbrance or lien or charge on the revenues from the Project prior to or on a parity with the charge on said revenues contained in the Indenture on the Project. Any sum so expended by the Trustee shall be secured by the Indenture, shall bear interest from the date of payment thereof, and shall be entitled to priority of payment over any of the Bonds.

Resignation and Removal of Trustee. The Trustee may resign and be discharged from the trusts of the Indenture upon written notice specifying the effective date of such resignation, such notice to be given to the GUSC and the holders of the Bonds. The Trustee may be removed by written instrument signed by the holders of a majority of the Bonds then outstanding.

Appointment of Successor Trustee. If a Trustee resigns, is removed or becomes otherwise incapable of serving, a successor may be appointed by written instrument signed by the holders of a majority of the Bonds then outstanding.

Modification of the Indenture The Indenture permits the GUSC and the Trustee, without the consent of any bondholders, to

enter into supplemental indentures (which will become a part of the Indenture) for the purpose of adding other covenants and agreements on the part of the GUSC, curing ambiguities, defects and inconsistent provisions and subjecting additional revenues to the pledge contained in the Indenture. The Indenture also permits the GUSC and the Trustee to enter into other supplemental indentures, with the written consent of the holders of not less than 66-2/3 % in principal amount of the Bonds then outstanding, except that without the written consent of the holder of each bond affected, the GUSC and the Trustee may not enter into any supplemental indenture that has the effect of reducing the principal amount of, the rate of interest on, or the premium payable upon the redemption of, any bond, nor, without the written consent of the holders of all the then outstanding Bonds, may the GUSC and the Trustee enter into any supplemental indenture permitting the extension of the maturity of any installment or principal of or interest on any bond, any change in any schedule of mandatory redemption of any series of the Bonds, the creation of a lien or charge on the revenues from the Project ranking prior to, or (except in connection with the issuance of Additional Bonds) on a parity with, the lien or charge thereon contained in the Indenture, the establishment of preferences or priorities as between the Bonds, or a reduction in the aggregate principal amount of Bonds the holders of which are required to consent to such supplemental indenture.

Satisfaction of the Indenture Whenever the entire indebtedness secured by the Indenture, including all proper charges of the

Trustee thereunder, shall have been fully paid, the Trustee shall cancel, satisfy and discharge the lien of the Indenture. For purposes of the Indenture (including, without limitation, the provisions pertaining to the issuance of Additional Bonds) any of the Bonds shall be deemed to have been paid when there shall have been irrevocably deposited with the Trustee for payment thereof the entire amount (principal, interest and premium, if any) due or to be due thereon until and at maturity, and, further, any of the callable Bonds shall also be deemed to have been paid when the GUSC shall have deposited with the Trustee the applicable redemption price of such callable Bond, and evidence that such callable Bond has been called for redemption in accordance with the Indenture.

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In addition, Bonds shall for all purposes of the Indenture be deemed fully paid if the GUSC

and the Trustee enter into a trust agreement making provision for the retirement of such Bonds by creating for that purpose an irrevocable trust fund sufficient to provide for payment and retirement of all such Bonds (including payment of the interest that will mature thereon until and on the dates they are retired, as such interest becomes due and payable), either by redemption prior to their respective maturities, by payment at their respective maturities or by payment of part thereof at their respective maturities and redemption of the remainder prior to their respective maturities, which said trust fund shall consist of (A) Federal Securities which are not subject to redemption prior to their respective maturities at the option of the issuer and which, if the principal thereof and the interest thereon are paid at their respective maturities, will produce funds sufficient so to provide for payment and retirement of all such Bonds, or (B) both cash and Federal Securities which together will produce funds sufficient for such purpose, or (C) cash sufficient for such purpose.

TAX EXEMPTION

In the opinion of Phelps, Jenkins, Gibson & Fowler, L.L.P., Tuscaloosa, Alabama, Bond Counsel, and subject to the qualifications hereinafter set forth, the interest on the Series 2011 Bonds is not excluded from gross income for Federal income tax purposes. Bond Counsel expresses no opinion regarding other Federal tax consequences arising with respect to the Series 2011 Bonds. Furthermore, in the opinion of said Bond Counsel, the interest on the Series 2011 Bonds is exempt, under existing statutes, from income taxation by the State of Alabama.

LEGAL MATTERS

The legality and validity of the Series 2011 Bonds will be approved by Phelps, Jenkins, Gibson & Fowler, L.L.P., Bond Counsel of Tuscaloosa, Alabama, whose approving opinions in substantially the forms set forth in Exhibit C to this Official Statement will be printed on such respective series of bonds. The employment of Bond Counsel in connection with the issuance of the Series 2011 Bonds is limited to the preparation of the sections of this Official Statement entitled "THE SERIES 2011 BONDS", "THE ISSUER", "THE WATER AND SEWER SERVICES AGREEMENT', "THE INDENTURE", "TAX EXEMPTION" and "LEGAL MATTERS", to the preparation of certain legal documents and supporting certificates, to a review of the transcript of proceedings by which the Series 2011 Bonds have been authorized to be issued and to the issuance of an approving opinion in conventional form relating solely to the validity of the Series 2011 Bonds, to the legal security for their payment, to the inclusion of the interest on the Series 2011 Bonds from gross income for purposes of taxation by the United States of America, and to the exemption of interest on the Series 2011 Bonds from income taxation by the State of Alabama. Said Bond Counsel has no responsibility for the accuracy or completeness of any information contained in this Official Statement other than in the sections hereof referred to above, and said Bond Counsel has not participated in any way in the preparation of the Appendices to this Official Statement and has no responsibility for the accuracy or completeness of any information contained therein or any information otherwise furnished to any person in connection with any offer or sale by the Series 2011 Bonds.

NO LITIGATION

There is no litigation pending or threatened restraining or enjoining the issuance, sale, execution or delivery of the Series 2011 Bonds or in any way questioning or affecting the validity of the Series 2011 Bonds or any proceedings of the GUSC taken with respect thereto, or which in any manner questions the right of the GUSC to finance the Project or to enter into and perform its obligations under the Indenture or the Water and Sewer Services Agreement. Further, there is no litigation pending or threatened which in any manner questions the right of City to enter into and perform its obligations under the Water and Sewer Services Agreement.

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RATINGS

Standard & Poor's has assigned a rating of "A+" to the Series 2011 Bonds. Any definitive explanation of the significance of any such ratings may be obtained only from Standard & Poor's. City furnished to Standard & Poor's the information contained in this Official Statement and certain other information respecting City and the Series 2011 Bonds. Generally, Standard & Poor's bases its rating on such material and information, as well as its own investigations, studies and assumptions. There is no assurance that any such rating will remain in effect for any given period of time or that such rating will not be lowered or withdrawn entirely if, in the judgment of Standard & Poor's, circumstances should warrant such action. Any such downward revision or withdrawal of any rating assigned to the Series 2011 Bonds could have an adverse effect on their market price. Neither City nor the Underwriter has undertaken any responsibility after the issuance of the Series 2011 Bonds to ensure maintenance of any rating or to oppose any such revision or withdrawal.

UNDERWRITING

Joe Jolly & Co., Inc. (the "Underwriter") will agree, pursuant to a Bond Purchase Agreement with the GUSC and City, to purchase the entire principal amount of the Series 2011 Bonds. The Underwriter will be obligated to take and pay for all the Series 2011 Bonds if any Series 2011 Bonds are taken. The Underwriter will purchase the Series 2011 Bonds at a purchase price of $9,961,172.60, plus accrued interest thereon from their dated dale until the date of their delivery (reflecting original issue discount of $113,227.40 and underwriting discount of $205,600.00). The Underwriter intends to offer the Series 2011 Bonds to the public initially at the offering prices set forth on the cover page of this Official Statement, but will reserve the right to change said initial offering price without prior notice. In the Bond Purchase Agreement, City will agree to indemnify the Underwriter against losses, claims, damages and liabilities arising out of any incorrect statements or information contained in this Official Statement pertaining to City, the Project and other matters. The obligation of the Underwriter to accept delivery of the Series 2011 Bonds will be subject to various conditions set forth in said Bond Purchase Agreement. The Underwriter has no responsibility for the accuracy or completeness of any information contained in this Official Statement other than the information contained under this caption, and the Underwriter has not participated in any way in the preparation of the Appendices to the Official Statement and has no responsibility for the accuracy or completeness of any information contained therein or any information otherwise furnished to any person in connection with any offer or sale by the Series 2011 Bonds.

Original Issue Discount. The original issue discount in the selling price of a Series 2011

Bond, to the extent properly allocable to each owner of such Series 2011 Bond, may result in certain tax consequences with respect to such owner. The original issue discount is the excess of the stated redemption price at maturity of such Series 2011 Bond over the initial offering price to the public, excluding underwriters and other intermediaries, at which price a portion of the Series 2011 Bonds of such maturity may be sold. Purchasers of any Series 2011 Bond at an original issue discount should consult their tax advisers regarding the determination and treatment of original issue discount for federal income tax purposes, and with respect to state and local tax consequences of owning such Series 2011 Bond.

Original Issue Premium. An amount equal to the excess of the purchase price of the Series 2011 Bond over its stated redemption price at maturity constitutes premium on such Series 2011 Bond. Purchasers of any Series 2011 Bond at a premium, whether at the time of initial issuance or subsequent thereto, should consult with their own tax advisors with respect to the determination and treatment of premium for federal income tax purposes, and with respect to state and local tax consequences of owning such Series 2011 Bonds.

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CONTINUING DISCLOSURE UNDERTAKING

The GUSC has entered into a Continuing Disclosure Agreement (the “Continuing Disclosure Agreement”) pursuant to the requirements of Rule 15c2-12 (“Rule 15c2-12”) adopted by the Securities and Exchange Commission (the “SEC”) under the Securities Exchange Act of 1934, as amended. The Continuing Disclosure Agreement will be entered into by the GUSC for the benefit of the beneficial owners of the Series 2011 Bonds and will obligate the GUSC to provide certain information annually and to file notice of the occurrence of certain events. A summary of the GUSC’s obligations under the Continuing Disclosure Agreement is contained in this section. A copy of the complete Continuing Disclosure Agreement may be obtained from the GUSC upon request. Annual Information The GUSC will agree that it will provide the following information: (a) Within 120 days after the end of each fiscal year, information about the GUSC’s operations and financial condition (referred to in Rule 15c2-12 as “annual financial information”) that is substantially the same as the information contained in the Projected Statement of Cash Flows in Exhibit “B” to this Official Statement. (b) Within 30 days after the receipt by the GUSC, but in no event more than 180 days after the end of each fiscal year, audited financial statements of the GUSC prepared on a basis consistent with general accepted accounting and auditing standards, as such standards may be modified from time to time for entities such as the GUSC.

Event Notices The GUSC will agree to file notice in a timely manner of the following events specified in Rule 15c2-12: (i) principal and interest payment delinquencies; (ii) non-payment related defaults; (iii) unscheduled draws on debt service reserves reflecting financial difficulties; (iv) unscheduled draws on credit enhancements reflecting financial difficulties; (v) substitution of credit or liquidity providers, or their failure to perform; (vi) adverse tax opinions or events affecting the tax-exempt status of the Series 2011 Bonds; (vii) modifications to rights of Series 2011 Bondholders; (viii) optional redemption of Series 2011 Bonds; (ix) defeasances of the Series 2011 Bonds; (x) release, substitution, or sale of property securing repayment of the Series 2011 Bonds; (xi) rating changes; and (xii) failure to provide required annual information on or before the date specified in the Continuing Disclosure Agreement. The list of events specified in Rule 15c2-12 does not purport to cover all events that may be material to the holders of the Series 2011 Bonds, and the Continuing Disclosure Agreement does not obligate the GUSC to file notice of all events that may be material to the holders of the Series 2011 Bonds. However, the GUSC may, in its discretion, file notice of events other than those specified by Rule 15c2-12. Method of Filing or Providing Information The GUSC will provide or file the information and notices in the locations specified by Rule 15c2-12. Currently Rule 15c2-12 requires filing with the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access system (“EMMA”) and, if applicable, certain state information repositories. These repositories may change from time to time. The identity of these repositories is available from the SEC (currently at www.sec.gov/info/municipal/nrmsir). In order to satisfy its filing obligations the GUSC expects to utilize the central post office filing system approved by the SEC.

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Consequences of Failure to Provide Information Failure by the GUSC to comply with the provisions of the Continuing Disclosure Agreement will not constitute an event of default under the Trust Indenture or the related financing documents; however, nothing in the Continuing Disclosure Agreement precludes the beneficial owner of any Series 2011 Bond from seeking a court order requiring the GUSC to comply with its obligations under the Continuing Disclosure Agreement, and the failure to comply will itself be a reportable event under Rule 15c2-12 and the Continuing Disclosure Agreement. Amendment The Continuing Disclosure Agreement may be amended by the GUSC if the amendment is required by, or consistent with, changes to, or interpretations of, Rule 15c2-12 made by governmental authority after the Series 2011 Bonds are issued.

TRUSTEE AND PAYING AGENT

The Bank of New York Mellon Trust Company, N.A. has been designated the Trustee and Paying Agent for the Series 2011 Bonds.

SOURCES OF INFORMATION

All information contained in the Official Statement has been obtained from sources which are believed to be reliable; however, all such information is subject, in all respects, to the complete body of information contained in the original sources thereof, and no guaranty, warranty or other representation is made by the Underwriter respecting accuracy and completeness of such information. The summaries or descriptions of provisions of the Series 2011 Bonds, the Indenture, the Water and Sewer Services Agreement, and all other references to other materials not purporting to be quoted in full are only brief outlines of some of the provisions thereof and do not constitute complete statements of such documents or provisions. For a more complete statement of the provisions of the Series 2011 Bonds, the Indenture and the Water and Sewer Services Agreement reference is made to the documents in their entireties, copies of which will be available from the Underwriter prior to the delivery of the Series 2011 Bonds and at the principal corporate trust office of the Trustee thereafter. In all instances complete reference should be made to the sources of information mentioned therein, including, but not limited to, the Appendices to this Official Statement, the Water and Sewer Services Agreement, the Indenture, and all other sources of information mentioned herein.

Neither the delivery of this Official Statement nor any sale of Series 2011 Bonds made hereundcr shall, under any circumstances, create any implication that there has been no change in the affairs of the GUSC, City, or of the Project since the date of this Official Statement or the earlier stated date as of which certain information contained herein is given.

CERTIFICATE CONCERNING OFFICIAL STATEMENT The Governmental Utility Services Corporation of the City of Aliceville has reviewed the

information contained herein as it relates to it, the Project and the use of the proceeds and the sources of revenue, and such information is true and correct as of this date, and such information does not contain an untrue statement of a material fact or omit to state a material fact which should be included herein for the purpose for which the Official Statement is intended to be used, or which is necessary to make the statements herein, in light of the circumstances under which they were made, not misleading.

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GOVERNMENTAL UTILITY SERVICES CORPORATION OF THE CITY OF ALICEVILLE By: /s/ P.M. Johnston

P.M. Johnston Its: Vice-Chairman

March 4, 2011

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Exhibit “A”

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Exhibit “B”

Exhibit “C”

FORM OF LEGAL OPINION

March 15, 2011

RE: $10,280,000 Water and Sewer Taxable Revenue Bonds, Series 2011 Ladies and Gentlemen:

We have examined certified copies of proceedings showing the organization under the laws of Alabama of the GOVERNMENTAL UTILITY SERVICES CORPORATION OF THE CITY OF ALICEVILLE (herein called the "GUSC"), together with copies of proceedings of the GUSC and other documents submitted to us pertaining to the issuance and validity of

$10,280,000 THE GOVERNMENTAL UTILITY SERVICES CORPORATION

OF THE CITY OF ALICEVILLE WATER AND SEWER TAXABLE REVENUE BONDS

SERIES 2011 Dated March 1, 2011

(the bonds above described being herein called the "Series 2011 Bonds"). We have not examined any of the Series 2011 Bonds as executed, but we have been furnished with appropriate certificates respecting their execution.

The documents submitted to us show as follows: (1) that the Bonds have been issued under a Trust Indenture dated as of March 1,

2011 (herein called the "Indenture"), between the GUSC and The Bank of New York Mellon Trust Company, N.A., Birmingham, Alabama, as trustee, wherein the GUSC pledged for payment of the Bonds the revenues derived by the GUSC from the operation of its water and sanitary sewer system as said system may be presently or hereafter constituted (herein called the "System") remaining after the payment of the operating costs and capital improvements to the System (the said revenues so remaining being herein called the "Annual Net Income"); and

(2) that in the Indenture the GUSC has reserved the privilege of issuing from time to

time additional bonds (herein called "Additional Bonds"), in one or more series

without limitation as to principal amount, on a parity with the Bonds upon compliance with the conditions set forth in the Indenture.

We are of the opinion that the GUSC has been duly organized as a public corporation pursuant to the laws of Alabama and has corporate power to own and operate the System, to issue the Bonds and to make the Indenture; that in the authorization, execution and issuance of the Bonds all applicable requirements of the constitution and laws of Alabama have been complied with; that each of the Indenture, the Bonds and the other transaction documents is a legal, valid and binding obligation of the parties thereto, has been duly authorized, executed, and delivered, and is enforceable in accordance with its terms; that the Bonds are in due and legal form and evidence valid obligations of the GUSC payable solely out of the Annual Net Income; that the Bonds have been issued under the Indenture and are secured, and with any Additional Bonds that may hereafter be issued, and without preference of one bond over another, by a pledge of the Annual Net Income and by the provisions of the Indenture; that the said pledge is a valid pledge of said revenues, subject to all prior lawful charges on said revenues; and that, under existing statutes, the interest income on the Bonds is exempt from income taxation by the State of Alabama. We have not examined the title of the GUSC to the System as they presently exist, but have, pursuant to instructions, assumed that the GUSC has good title to the System.

The Indenture provides that in the event the GUSC should default in any of the provisions thereof in the manner and for the time therein provided, the trustee under the Indenture may declare all Bonds then outstanding under the Indenture to be forthwith due and payable, whereupon the same shall immediately become due and payable and the said Trustee shall be entitled to exercise the rights specified in the Indenture. The Indenture does not, however, constitute a mortgage on the System and is not subject to foreclosure. We express no opinion regarding the accuracy, adequacy, or completeness of the Official Statement of the GUSC relating to the Bonds. Further, we express no opinion regarding tax consequences arising with respect to the Bonds, other than as expressly set forth herein. The rights of the holders of the Bonds and the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights and the exercise of judicial discretion in appropriate cases. This opinion is given as of the date hereof, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention, or any changes in law that may hereafter occur.

Yours very truly, Stephen E. Snow, For the Firm