1030-00001 · Dralvecen Fenn & Co., Inc · Opinions & Certificates

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CALDERWOOD & HARKNESS LLP Attorneys at Law

1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101

Telephone: (206) 442-7800 Facsimile: (206) 442-7801 www.calderwoodharkness.com

October 24, 2023

Cascadia State Infrastructure Authority 1100 Capitol Way South, Suite 400 Olympia, Washington 98501

Attention: Harold K. Nakamura, Executive Director

Martin J. Espinoza, General Counsel

Pacific Northwest Trust Company, National Association, as Trustee 1201 Third Avenue, Suite 1600 Seattle, Washington 98101

Attention: Alan M. Greer, Vice President, Corporate Trust Services

Meridian Capital Partners LLC, as Senior Managing Underwriter and Representative of the Underwriters 600 Third Avenue, 28th Floor New York, New York 10016

Attention: Jonathan D. Kessler, Managing Director, Public Finance

Dralvecen Fenn & Co., Inc., as Co-Managing Underwriter 200 Park Avenue, Suite 3100 New York, New York 10166

Attention: Sarah E. Mulvaney, Director, Municipal Finance

Re: $220,000,000 Cascadia State Infrastructure Authority Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) — Opinion of Issuer's Counsel

C&H Matter No. 1030-00001

Ladies and Gentlemen:

We have acted as issuer's counsel to the Cascadia State Infrastructure Authority ("CSIA" or the "Authority"), a governmental instrumentality and public body corporate of the State of Washington created and operating pursuant to Chapter 43.160A of the Revised Code of Washington (the "Enabling Act"), in connection with the authorization, issuance, sale, and delivery of $220,000,000 aggregate principal amount of Cascadia State Infrastructure Authority Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) (the "Series 2023A Bonds" or the "Bonds"). This opinion letter is delivered to you pursuant to Section 8(b)(4) of the Bond Purchase Agreement dated August 30, 2023 (as defined below), between the Authority and Meridian Capital Partners LLC, acting as representative of the Underwriters (as defined below), as a condition to the closing of the issuance and sale of the Series 2023A Bonds on the date hereof.

In connection with this opinion, we have examined the documents, instruments, certificates, and records described in Section 1 below, and have conducted such other investigations and analyses as we have deemed necessary or appropriate for the purposes of the opinions expressed herein. All capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Indenture (as defined below) or the other Financing Documents (as defined below), as applicable.

Section 1. Defined Terms; Documents Examined

1.1 Financing Documents

In rendering the opinions set forth herein, we have examined executed counterparts or certified copies of each of the following documents (collectively, the "Financing Documents"):

(a) Bond Indenture. Bond Indenture (Trust Indenture) dated as of October 24, 2023, by and between the Authority, as Issuer, and Pacific Northwest Trust Company, National Association ("PNTC"), as Trustee (the "Indenture"). The Indenture sets forth the general terms and conditions applicable to all Bonds and parity obligations issued thereunder, including the creation and establishment of funds and accounts, the security provisions, the covenants of the Authority, and the rights, duties, and obligations of the Trustee.

(b) First Supplemental Indenture. First Supplemental Indenture dated as of October 24, 2023, by and between the Authority and PNTC, as Trustee, supplementing and amending the Indenture and authorizing the issuance of the Series 2023A Bonds in the aggregate principal amount of $220,000,000 (the "First Supplemental Indenture"). The First Supplemental Indenture sets forth the specific terms of the Series 2023A Bonds, including the interest rate, maturity date, redemption provisions, and form of the Bonds.

(c) Revenue Pledge Agreement. Revenue Pledge Agreement dated as of October 24, 2023, by and between the Authority and PNTC, as Trustee (the "Revenue Pledge Agreement"). The Revenue Pledge Agreement sets forth the terms and conditions of the pledge of net water-treatment revenues of the Authority as security for the Series 2023A Bonds and all other parity obligations issued under the Indenture, including the rate covenant and the flow of funds.

(d) Bond Purchase Agreement. Bond Purchase Agreement dated August 30, 2023, by and between the Authority and Meridian Capital Partners LLC, acting on behalf of itself and Dralvecen Fenn & Co., Inc. (collectively, the "Underwriters"), whereby the Underwriters agreed to purchase the Series 2023A Bonds from the Authority at the purchase price and upon the terms and conditions set forth therein (the "Bond Purchase Agreement").

(e) Continuing Disclosure Agreement. Continuing Disclosure Agreement dated as of October 24, 2023, by and between the Authority and PNTC, as Dissemination Agent (the "Continuing Disclosure Agreement"). The Continuing Disclosure Agreement sets forth the Authority's undertaking to provide certain annual financial information and notices of the occurrence of certain events in compliance with Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended.

(f) Tax Regulatory Agreement. Tax Regulatory Agreement and Certificate dated October 15, 2023, executed by the Authority (the "Tax Certificate"). The Tax Certificate sets forth certain representations, covenants, and expectations of the Authority regarding the use and investment of the proceeds of the Series 2023A Bonds and the use of the facilities financed thereby, for the purpose of establishing and maintaining the exclusion of interest on the Bonds from gross income for federal income tax purposes.

(g) Escrow Deposit Agreement. Escrow Deposit Agreement dated as of October 24, 2023, by and between the Authority and PNTC, as Escrow Agent (the "Escrow Deposit Agreement"). The Escrow Deposit Agreement governs the deposit and investment of certain Bond proceeds held in escrow pending application to costs of the project.

(h) Debt-Service Reserve Fund Surety Bond Agreement. Debt-Service Reserve Fund Surety Bond Agreement dated as of October 24, 2023, among the Authority, PNTC, as Trustee, and Olympia Guaranty Insurance Corp. (the "Surety Bond Agreement"). The Surety Bond Agreement governs the terms and conditions of the municipal bond insurance policy (Policy No. OG-2023-MUN-4718) issued by Olympia Guaranty Insurance Corp. as a surety bond to satisfy the debt-service reserve fund requirement for the Series 2023A Bonds under the Indenture.

Items (a) through (h) above are collectively referred to herein as the "Financing Documents."

1.2 Other Documents and Records Examined

In addition to the Financing Documents, we have examined originals or copies, certified or otherwise identified to our satisfaction, of the following documents, instruments, certificates, and records:

(i) CSIA Board Resolution No. 2023-014, duly adopted by the Board of Directors of the Authority on May 9, 2023 (the "Authorizing Resolution"), authorizing the issuance and sale of the Series 2023A Bonds in an aggregate principal amount not to exceed $225,000,000, approving the form of and authorizing the execution and delivery of the Financing Documents, and delegating to the Executive Director and the Chief Financial Officer certain authority with respect to the final terms of the Bonds and the execution and delivery of documents relating thereto.

(ii) Chapter 43.160A of the Revised Code of Washington (the "Enabling Act"), being the statutory authority under which the Authority was created and under which it operates and issues its revenue obligations.

(iii) The Preliminary Official Statement dated June 26, 2023, relating to the Series 2023A Bonds (the "Preliminary Official Statement") and the Final Official Statement dated September 5, 2023, relating to the Series 2023A Bonds (the "Official Statement"), each prepared by the Authority in connection with the public offering of the Bonds by the Underwriters.

(iv) Certificate of Authorized Officer of the Authority, executed by Harold K. Nakamura, Executive Director, dated October 24, 2023 (the "Certificate of Authorized Officer"), certifying as to certain factual matters relevant to the opinions expressed herein, including the absence of litigation and the accuracy of certain representations and warranties.

(v) Certificate of the Chief Financial Officer of the Authority, executed by Denise R. Whitford, Chief Financial Officer, dated October 24, 2023 (the "CFO's Certificate"), certifying compliance with the rate covenant and the additional bonds test set forth in the Indenture with respect to the issuance of the Series 2023A Bonds.

(vi) State Environmental Policy Act ("SEPA") Determination of Non-Significance issued by the Washington State Department of Ecology on September 12, 2022, with respect to the Puget Sound Regional Advanced Water Treatment Facility project to be financed with a portion of the proceeds of the Series 2023A Bonds.

(vii) National Pollutant Discharge Elimination System ("NPDES") Permit No. WA-004837-2 modification approved by the Washington State Department of Ecology on January 6, 2023, authorizing the discharge of treated effluent from the Puget Sound Regional Advanced Water Treatment Facility.

(viii) Design-Build Contract (Guaranteed Maximum Price) No. CSIA-DB-2023-001, by and between the Authority and Northtide Environmental Engineering, Inc., dated March 10, 2023, in the guaranteed maximum price amount of $193,500,000, for the design and construction of the Puget Sound Regional Advanced Water Treatment Facility located at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501.

(ix) The audited financial statements of the Authority for the fiscal year ended June 30, 2022, including the independent auditor's report thereon issued by Hargrove & Associates CPAs, PLLC.

(x) Such other documents, certificates, records, instruments, and matters of law as we have deemed necessary or appropriate for the purposes of the opinions expressed herein.

(xi) Rating letters from Lakeshore Ratings Group, Inc., assigning an underlying long-term rating of "AA" with a stable outlook to the Series 2023A Bonds, and from Pinnacle Credit Analytics, Inc., assigning an underlying long-term rating of "AA−" with a stable outlook to the Series 2023A Bonds, each dated July 28, 2023.

1.3 Key Defined Terms

For purposes of this opinion, the following terms shall have the meanings set forth below:

The Series 2023A Bonds bear interest at a fixed rate of 3.25% per annum, computed on the basis of a 360-day year consisting of twelve 30-day months. The Bonds mature on October 1, 2053, and are subject to optional redemption prior to maturity, in whole or in part on any date, at a redemption price equal to 100% of the principal amount thereof plus accrued interest to the date of redemption, on or after October 1, 2033. The Bonds were issued in fully registered form in authorized denominations of $5,000 or any integral multiple thereof and are registered through the book-entry system of The Depository Trust Company ("DTC"), with Cede & Co. as the sole registered owner of the Bonds. The CUSIP base number assigned to the Bonds is 148392.

The Authority's employer identification number is 91-2058374. The aggregate principal amount of the Series 2023A Bonds is $220,000,000. As of the date hereof, and after giving effect to the issuance of the Series 2023A Bonds, the total outstanding parity revenue obligations of the Authority equal $3,340,000,000 (consisting of $3,120,000,000 of prior parity obligations outstanding immediately prior to this issuance plus the $220,000,000 of Series 2023A Bonds issued on the date hereof).

Section 2. Assumptions

In rendering the opinions set forth in Section 3 below, we have, with your consent and without independent investigation or verification, made and relied upon the following assumptions:

(a) We have assumed the genuineness of all signatures (other than those of the Authority and its officers and agents), the legal capacity of all natural persons, the authenticity of all documents submitted to us as originals, and the conformity to authentic originals of all documents submitted to us as copies (whether certified, conformed, photostatic, electronic, or otherwise).

(b) We have assumed that each party to the Financing Documents (other than the Authority) has the requisite power, authority, and legal right to enter into, execute, deliver, and perform its respective obligations under the Financing Documents to which it is a party, and that each such Financing Document has been duly authorized by all necessary action on the part of each such party (other than the Authority), has been duly executed and delivered by such party, and constitutes a legal, valid, and binding obligation of such party enforceable against such party in accordance with its terms.

(c) We have assumed that Pacific Northwest Trust Company, National Association has been duly organized and is validly existing as a national banking association under the laws of the United States of America, and that it has all requisite fiduciary and trust powers necessary to accept the trusts created under the Indenture and to serve as Trustee, Dissemination Agent, and Escrow Agent as contemplated by the Financing Documents.

(d) We have assumed the due authorization, execution, and delivery of the Surety Bond (Policy No. OG-2023-MUN-4718) by Olympia Guaranty Insurance Corp., and that such surety bond constitutes a legal, valid, and binding obligation of Olympia Guaranty Insurance Corp. enforceable in accordance with its terms.

(e) We have assumed the accuracy and completeness of all factual representations, warranties, and certifications contained in the Certificate of Authorized Officer and the CFO's Certificate, each delivered on the date hereof, without independent investigation or verification of such facts.

(f) We have assumed that no event has occurred since the date of the documents and certificates examined by us that would alter the facts or circumstances set forth therein in any material respect.

Section 3. Opinions

Based upon and subject to the foregoing, and subject to the qualifications, limitations, and exceptions set forth in Section 4 below, we are of the opinion that:

3.1 Due Organization and Valid Existence

The Cascadia State Infrastructure Authority is a duly created and validly existing governmental instrumentality and public body corporate of the State of Washington, organized and operating pursuant to the provisions of the Enabling Act (Chapter 43.160A of the Revised Code of Washington), as amended to the date hereof. The Authority has full legal right, power, and authority under the Enabling Act and other applicable provisions of the laws of the State of Washington to carry out its governmental functions and purposes as described in and contemplated by the Enabling Act, including, without limitation, the acquisition, construction, financing, operation, and maintenance of water treatment facilities and related infrastructure for the benefit of the citizens and communities of the State of Washington. The Authority maintains its principal offices at 1100 Capitol Way South, Suite 400, Olympia, Washington 98501.

3.2 Power and Authority to Issue the Bonds

The Authority has full legal right, power, and authority under the Enabling Act and other applicable provisions of the Revised Code of Washington to:

(i) issue the Series 2023A Bonds in the aggregate principal amount of $220,000,000;

(ii) pledge net water-treatment revenues of the Authority as security for the payment of the principal of, premium, if any, and interest on the Series 2023A Bonds on a parity basis with the Authority's existing outstanding parity revenue obligations;

(iii) enter into and perform its obligations under each of the Financing Documents; and

(iv) carry out and consummate the transactions contemplated by the Financing Documents, including, without limitation, the financing of the design, construction, equipping, testing, and commissioning of the Puget Sound Regional Advanced Water Treatment Facility, an advanced tertiary water treatment facility located at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501, and related improvements to the Authority's regional water treatment system.

3.3 Due Authorization

The issuance and sale of the Series 2023A Bonds and the execution and delivery of each of the Financing Documents have been duly authorized by all necessary action on the part of the Authority, including, without limitation, the adoption of the Authorizing Resolution (Board Resolution No. 2023-014) by the Board of Directors of the Authority on May 9, 2023. The Authorizing Resolution was duly adopted at a meeting of the Board of Directors at which a quorum was present and acting throughout, under the chairmanship of Commissioner Lorraine Chu, and in compliance with the procedural requirements of the Enabling Act and the Authority's bylaws. The Authorizing Resolution authorized the issuance of the Series 2023A Bonds and approved the form of and authorized the execution and delivery of the Financing Documents, and delegated to Harold K. Nakamura, Executive Director, and Denise R. Whitford, Chief Financial Officer, the authority to determine the final terms and conditions of the Bonds and to execute and deliver all documents and instruments necessary or appropriate to effectuate the transactions contemplated by the Authorizing Resolution.

No further approval, consent, authorization, or order of any court, governmental authority, legislative body, regulatory agency, or public board is required for the valid issuance and delivery of the Series 2023A Bonds or for the execution and delivery of any of the Financing Documents by the Authority, other than such approvals, consents, and authorizations as have been duly obtained, given, or taken and remain in full force and effect as of the date hereof.

3.4 Valid Execution and Delivery

Each of the Financing Documents has been duly executed and delivered by authorized officers of the Authority, specifically as follows:

(a) The Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, the Continuing Disclosure Agreement, the Escrow Deposit Agreement, and the Surety Bond Agreement were each executed on behalf of the Authority by Harold K. Nakamura, Executive Director, on October 24, 2023, each acting within the scope of the authority delegated to him by the Authorizing Resolution.

(b) The Bond Purchase Agreement was executed on behalf of the Authority by Harold K. Nakamura, Executive Director, on August 30, 2023, acting within the scope of the authority delegated to him by the Authorizing Resolution.

(c) The Tax Regulatory Agreement and Certificate was executed on behalf of the Authority by Harold K. Nakamura, Executive Director, and Denise R. Whitford, Chief Financial Officer, on October 15, 2023, each acting within the scope of the authority delegated to them by the Authorizing Resolution.

Each such officer was, at the time of such execution, a duly appointed officer of the Authority authorized to execute such documents on behalf of the Authority.

3.5 Enforceability. Each of the Financing Documents constitutes a legal, valid, and binding obligation of the Authority, enforceable against the Authority in accordance with its respective terms, subject to the qualifications, limitations, and exceptions set forth in Section 4 below.

The Series 2023A Bonds, having been duly authorized, executed, and issued by the Authority and duly authenticated by PNTC, as Trustee, and having been delivered to and paid for by the Underwriters in accordance with the terms of the Indenture, the First Supplemental Indenture, and the Bond Purchase Agreement, constitute legal, valid, and binding special, limited obligations of the Authority, payable solely from the sources pledged therefor under the Indenture and the Revenue Pledge Agreement, and are enforceable against the Authority in accordance with their terms, subject to the qualifications, limitations, and exceptions set forth in Section 4 below. The Series 2023A Bonds are entitled to the benefits and security of the Indenture, the First Supplemental Indenture, and the Revenue Pledge Agreement.

The Series 2023A Bonds do not constitute a debt or liability of the State of Washington or of any political subdivision thereof other than the Authority, and neither the faith and credit nor the taxing power of the State of Washington or of any political subdivision thereof is pledged to the payment of the principal of, premium, if any, or interest on the Series 2023A Bonds.

3.6 Validity of Revenue Pledge

The pledge of net water-treatment revenues created by the Revenue Pledge Agreement and the Indenture constitutes a valid pledge of such revenues for the benefit of the holders of the Series 2023A Bonds. As used herein, "net water-treatment revenues" means the gross revenues derived by the Authority from the ownership and operation of its regional water treatment system, including, without limitation:

(a) wholesale water treatment service charges from the fourteen (14) participating municipal water districts;

(b) connection fees and capacity charges;

(d) all other income and revenues derived from or attributable to the Authority's water treatment system,

after deduction of operation and maintenance expenses of the system as defined in the Indenture.

Such pledge secures the Series 2023A Bonds on a parity basis with all other outstanding parity revenue obligations of the Authority heretofore issued under the Indenture or any prior indenture. As of the date hereof, the total outstanding parity revenue obligations of the Authority (including the Series 2023A Bonds) are $3,340,000,000, consisting of $3,120,000,000 of prior parity obligations and the $220,000,000 of Series 2023A Bonds.

The rate covenant contained in Section 5.02 of the Revenue Pledge Agreement requires the Authority to establish, fix, prescribe, and collect rates, fees, and charges for the use and services of the regional water treatment system which are reasonably expected to produce, in each fiscal year, net pledged revenues of not less than 1.40 times (1.40x) the annual aggregate parity debt service due and payable in such fiscal year on all outstanding parity obligations of the Authority.

3.7 No Conflicts or Violations

The execution and delivery of the Financing Documents and the issuance, sale, and delivery of the Series 2023A Bonds by the Authority, and the consummation of the transactions contemplated thereby, do not and will not:

(i) violate or conflict with the Enabling Act or any other applicable law, rule, regulation, order, writ, judgment, injunction, or decree of the State of Washington or of the United States of America known to us to be applicable to the Authority or the transactions contemplated by the Financing Documents;

(ii) violate, conflict with, result in a breach of, or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, any resolution, agreement, indenture, mortgage, deed of trust, lease, or other instrument or agreement to which the Authority is a party or by which the Authority or any of its properties or revenues are bound, including, without limitation, any existing bond indenture, supplemental indenture, or resolution authorizing or securing any outstanding parity revenue obligations of the Authority; or

(iii) result in the creation or imposition of any lien, charge, encumbrance, security interest, or restriction upon any property or revenues of the Authority other than the lien and pledge expressly created by the Indenture and the Revenue Pledge Agreement for the benefit of the holders of the Series 2023A Bonds and any other parity obligations issued thereunder.

3.8 No Litigation

Based solely upon our review of the Certificate of Authorized Officer delivered by Harold K. Nakamura, Executive Director of the Authority, on the date hereof, and without independent investigation or verification, to our knowledge there is no action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, public board, governmental authority, or regulatory body, pending or, to the knowledge of the officers of the Authority, threatened against or affecting the Authority, which:

(i) challenges or questions the creation, organization, or existence of the Authority or the title of any of its officers to their respective offices;

(ii) contests or questions the authority of the Authority to issue the Series 2023A Bonds or to execute and deliver any of the Financing Documents, or to carry out the transactions contemplated thereby;

(iii) contests or questions the validity or enforceability of the Series 2023A Bonds, the Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, or any of the other Financing Documents; or

(iv) would, if adversely determined, materially adversely affect the financial condition of the Authority, the ability of the Authority to perform its obligations under the Financing Documents, or the pledged revenues securing the Series 2023A Bonds.

3.9 Governmental Approvals

All governmental approvals, consents, authorizations, orders, filings, registrations, and permits required under applicable law for the issuance, sale, and delivery of the Series 2023A Bonds and for the execution and delivery of the Financing Documents have been duly obtained, made, or given by or on behalf of the Authority, including, without limitation:

(i) CSIA Board Resolution No. 2023-014, duly adopted by the Board of Directors of the Authority on May 9, 2023, authorizing the issuance and sale of the Series 2023A Bonds and the execution and delivery of the Financing Documents;

(ii) the SEPA Determination of Non-Significance issued by the Washington State Department of Ecology on September 12, 2022, with respect to the Puget Sound Regional Advanced Water Treatment Facility project; and

(iii) the NPDES Permit No. WA-004837-2 modification approved by the Washington State Department of Ecology on January 6, 2023, authorizing the discharge of treated effluent from the Puget Sound Regional Advanced Water Treatment Facility.

All such approvals, consents, authorizations, orders, filings, registrations, and permits remain in full force and effect as of the date hereof, have not been revoked, modified, amended, or rescinded, and are not the subject of any pending or, to the knowledge of the Authority, threatened proceedings seeking their revocation, modification, or rescission.

3.10 Additional Bonds Test Compliance

Based upon our review of the CFO's Certificate dated October 24, 2023, executed by Denise R. Whitford, Chief Financial Officer of the Authority, and delivered on the date hereof, the additional bonds test set forth in Article III of the Indenture has been satisfied with respect to the issuance of the Series 2023A Bonds. Specifically:

(a) The Authority's net pledged revenues for the most recently completed fiscal year (fiscal year ended June 30, 2022) were $412,600,000, calculated as follows:

(b) Total annual parity debt service on all outstanding parity obligations (including the Series 2023A Bonds) is $278,400,000, which includes the approximately $11,610,000 of estimated annual debt service on the Series 2023A Bonds.

(d) The calculated debt-service coverage ratio of approximately 1.48x exceeds the minimum coverage ratio of 1.40x required by the additional bonds test set forth in the Indenture.

We have relied upon the CFO's Certificate for the financial data and calculations set forth above and have not independently verified such data or calculations.

Section 4. Qualifications, Limitations, and Exceptions

The opinions expressed in Section 3 above are subject to the following qualifications, limitations, and exceptions:

4.1 Bankruptcy and Insolvency Qualification

The opinions expressed in paragraphs 3.5 and 3.6 above with respect to the enforceability of the Financing Documents and the Series 2023A Bonds are subject to and limited by: (a) applicable bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer, and other similar laws affecting the enforcement of creditors' rights generally, as from time to time in effect; (b) the effect of general principles of equity (including, without limitation, concepts of materiality, good faith, fair dealing, reasonableness, and the possible unavailability of specific performance or injunctive relief), regardless of whether considered in a proceeding in equity or at law; and (c) the exercise of judicial discretion and the limitations of applicable law in certain circumstances upon the availability of certain equitable remedies, including, without limitation, the remedy of specific performance. We express no opinion as to whether a court would enforce any provision of the Financing Documents that purports to waive or limit rights to jury trial, choice of venue, or the jurisdiction of any particular court.

4.2 Scope of Law Covered

This opinion is limited in all respects to the laws of the State of Washington and the federal laws of the United States of America, each as in effect on the date hereof, and we express no opinion as to the laws of any other jurisdiction. We note that we have not, for purposes of this opinion, reviewed or analyzed the securities laws of any state (commonly referred to as "Blue Sky" laws) or any federal securities laws, including, without limitation, the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended (other than Rule 15c2-12 promulgated thereunder to the extent relevant to the Continuing Disclosure Agreement), and we express no opinion with respect thereto.

4.3 No Tax Opinion

We express no opinion herein as to the excludability of interest on the Series 2023A Bonds from gross income for purposes of federal income taxation under Section 103 of the Internal Revenue Code of 1986, as amended, or as to any other federal, state, or local tax consequences of the ownership or disposition of the Bonds. The opinion as to the tax-exempt status of interest on the Series 2023A Bonds for federal income tax purposes is being separately rendered by Pryor Crestfield LLP and Calderwood & Harkness LLP in their capacity as Co-Bond Counsel to the Authority, in a separate opinion letter dated the date hereof and delivered at the closing of the issuance and sale of the Series 2023A Bonds.

4.4 No Opinion on Certain Parties

We have served as counsel only to the Authority in connection with the transactions described herein, and we express no opinion as to the due organization, valid existence, good standing, qualification, power, authority, or capacity of Pacific Northwest Trust Company, National Association, Olympia Guaranty Insurance Corp., Meridian Capital Partners LLC, Dralvecen Fenn & Co., Inc., Northtide Environmental Engineering, Inc., or any other person or entity (other than the Authority). We express no opinion as to whether any such party has duly authorized, executed, or delivered any document or instrument to which it is a party, or as to the enforceability of any such document or instrument against any such party.

4.5 Reliance on Certificates

In rendering the opinions set forth in paragraphs 3.8 (No Litigation) and 3.10 (Additional Bonds Test Compliance), we have relied entirely upon the Certificate of Authorized Officer and the CFO's Certificate, each delivered on the date hereof, without independent investigation, inquiry, or verification of the matters set forth therein. To the extent that the accuracy of the opinions expressed in such paragraphs depends upon factual matters, our opinions are limited by, and subject to, the accuracy and completeness of such certificates. We assume no responsibility for, and express no opinion with respect to, the accuracy or completeness of any financial data, projections, or calculations set forth in such certificates or in any other document examined by us.

4.6 Security Interest Perfection

We note that the enforceability and perfection of the pledge of revenues under the Revenue Pledge Agreement and the Indenture, including, without limitation, the priority of such pledge and the creation of a perfected security interest in favor of the Trustee and the holders of the Bonds in the pledged revenues, is addressed in a separate opinion letter of this firm dated the date hereof (the "Enforceability Opinion — Revenue Pledge Agreement"), and we express no opinion herein with respect to such matters except to the extent expressly set forth in paragraph 3.6 above. The opinion set forth in paragraph 3.6 is subject to and qualified by the opinions and qualifications set forth in such separate opinion letter.

Section 5. Reliance and Distribution

This opinion is rendered solely for the benefit of the addressees named herein — the Cascadia State Infrastructure Authority, Pacific Northwest Trust Company, National Association (as Trustee), Meridian Capital Partners LLC (as Senior Managing Underwriter and Representative of the Underwriters), and Dralvecen Fenn & Co., Inc. (as Co-Managing Underwriter) — and their respective successors and assigns, in each case solely in connection with the transaction described herein. This opinion may not be relied upon by any other person or entity, or used, quoted, circulated, or referred to for any other purpose, without our prior written consent in each instance, except that this opinion may be included as an exhibit to a closing transcript for the Series 2023A Bonds and may be referred to in the Official Statement.

This opinion is given as of the date hereof, and we undertake no obligation, and hereby disclaim any obligation, to update, revise, or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention or any changes in applicable law (whether by legislative action, judicial decision, administrative action, or otherwise) that may hereafter occur. Our opinions are expressly limited to the matters set forth herein, and no opinion is to be implied or inferred beyond the matters expressly stated herein.

This opinion may be relied upon by the addressees hereof only in connection with the issuance, sale, and delivery of the Series 2023A Bonds and the execution and delivery of the Financing Documents as described herein, and not in connection with any subsequent transaction, including any remarketing, resale, transfer, exchange, or refunding of the Series 2023A Bonds.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Name: George Trujillo

Title: Partner

1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101 Telephone: (206) 442-7800 C&H Matter No. 1030-00001

Amount

FY 2022 Gross Pledged Revenues	$489,300,000
Less: FY 2022 Operation & Maintenance Expenses	($76,700,000)
FY 2022 Net Pledged Revenues	$412,600,000
FY 2022 Net Pledged Revenues	$412,600,000
Total Annual Parity Debt Service (including Series 2023A Bonds)	$278,400,000
Debt-Service Coverage Ratio	1.48x

CALDERWOOD & HARKNESS LLP Attorneys at Law
1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101
Telephone: (206) 442-7800 Facsimile: (206) 442-7801 www.calderwoodharkness.com
October 24, 2023
Cascadia State Infrastructure Authority 1100 Capitol Way South, Suite 400 Olympia, Washington 98501
Attention: Harold K. Nakamura, Executive Director
Martin J. Espinoza, General Counsel
Pacific Northwest Trust Company, National Association, as Trustee 1201 Third Avenue, Suite 1600 Seattle, Washington 98101
Attention: Alan M. Greer, Vice President, Corporate Trust Services
Meridian Capital Partners LLC, as Senior Managing Underwriter and Representative of the Underwriters 600 Third Avenue, 28th Floor New York, New York 10016
Attention: Jonathan D. Kessler, Managing Director, Public Finance
Dralvecen Fenn & Co., Inc., as Co-Managing Underwriter 200 Park Avenue, Suite 3100 New York, New York 10166
Attention: Sarah E. Mulvaney, Director, Municipal Finance
Re: $220,000,000 Cascadia State Infrastructure Authority Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) — Opinion of Issuer's Counsel
C&H Matter No. 1030-00001
Ladies and Gentlemen:
We have acted as issuer's counsel to the Cascadia State Infrastructure Authority ("CSIA" or the "Authority"), a governmental instrumentality and public body corporate of the State of Washington created and operating pursuant to Chapter 43.160A of the Revised Code of Washington (the "Enabling Act"), in connection with the authorization, issuance, sale, and delivery of $220,000,000 aggregate principal amount of Cascadia State Infrastructure Authority Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) (the "Series 2023A Bonds" or the "Bonds"). This opinion letter is delivered to you pursuant to Section 8(b)(4) of the Bond Purchase Agreement dated August 30, 2023 (as defined below), between the Authority and Meridian Capital Partners LLC, acting as representative of the Underwriters (as defined below), as a condition to the closing of the issuance and sale of the Series 2023A Bonds on the date hereof.
In connection with this opinion, we have examined the documents, instruments, certificates, and records described in Section 1 below, and have conducted such other investigations and analyses as we have deemed necessary or appropriate for the purposes of the opinions expressed herein. All capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Indenture (as defined below) or the other Financing Documents (as defined below), as applicable.
Section 1. Defined Terms; Documents Examined
1.1 Financing Documents
In rendering the opinions set forth herein, we have examined executed counterparts or certified copies of each of the following documents (collectively, the "Financing Documents"):
(a) Bond Indenture. Bond Indenture (Trust Indenture) dated as of October 24, 2023, by and between the Authority, as Issuer, and Pacific Northwest Trust Company, National Association ("PNTC"), as Trustee (the "Indenture"). The Indenture sets forth the general terms and conditions applicable to all Bonds and parity obligations issued thereunder, including the creation and establishment of funds and accounts, the security provisions, the covenants of the Authority, and the rights, duties, and obligations of the Trustee.
(b) First Supplemental Indenture. First Supplemental Indenture dated as of October 24, 2023, by and between the Authority and PNTC, as Trustee, supplementing and amending the Indenture and authorizing the issuance of the Series 2023A Bonds in the aggregate principal amount of $220,000,000 (the "First Supplemental Indenture"). The First Supplemental Indenture sets forth the specific terms of the Series 2023A Bonds, including the interest rate, maturity date, redemption provisions, and form of the Bonds.
(c) Revenue Pledge Agreement. Revenue Pledge Agreement dated as of October 24, 2023, by and between the Authority and PNTC, as Trustee (the "Revenue Pledge Agreement"). The Revenue Pledge Agreement sets forth the terms and conditions of the pledge of net water-treatment revenues of the Authority as security for the Series 2023A Bonds and all other parity obligations issued under the Indenture, including the rate covenant and the flow of funds.
(d) Bond Purchase Agreement. Bond Purchase Agreement dated August 30, 2023, by and between the Authority and Meridian Capital Partners LLC, acting on behalf of itself and Dralvecen Fenn & Co., Inc. (collectively, the "Underwriters"), whereby the Underwriters agreed to purchase the Series 2023A Bonds from the Authority at the purchase price and upon the terms and conditions set forth therein (the "Bond Purchase Agreement").
(e) Continuing Disclosure Agreement. Continuing Disclosure Agreement dated as of October 24, 2023, by and between the Authority and PNTC, as Dissemination Agent (the "Continuing Disclosure Agreement"). The Continuing Disclosure Agreement sets forth the Authority's undertaking to provide certain annual financial information and notices of the occurrence of certain events in compliance with Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended.
(f) Tax Regulatory Agreement. Tax Regulatory Agreement and Certificate dated October 15, 2023, executed by the Authority (the "Tax Certificate"). The Tax Certificate sets forth certain representations, covenants, and expectations of the Authority regarding the use and investment of the proceeds of the Series 2023A Bonds and the use of the facilities financed thereby, for the purpose of establishing and maintaining the exclusion of interest on the Bonds from gross income for federal income tax purposes.
(g) Escrow Deposit Agreement. Escrow Deposit Agreement dated as of October 24, 2023, by and between the Authority and PNTC, as Escrow Agent (the "Escrow Deposit Agreement"). The Escrow Deposit Agreement governs the deposit and investment of certain Bond proceeds held in escrow pending application to costs of the project.
(h) Debt-Service Reserve Fund Surety Bond Agreement. Debt-Service Reserve Fund Surety Bond Agreement dated as of October 24, 2023, among the Authority, PNTC, as Trustee, and Olympia Guaranty Insurance Corp. (the "Surety Bond Agreement"). The Surety Bond Agreement governs the terms and conditions of the municipal bond insurance policy (Policy No. OG-2023-MUN-4718) issued by Olympia Guaranty Insurance Corp. as a surety bond to satisfy the debt-service reserve fund requirement for the Series 2023A Bonds under the Indenture.
Items (a) through (h) above are collectively referred to herein as the "Financing Documents."
1.2 Other Documents and Records Examined
In addition to the Financing Documents, we have examined originals or copies, certified or otherwise identified to our satisfaction, of the following documents, instruments, certificates, and records:
(i) CSIA Board Resolution No. 2023-014, duly adopted by the Board of Directors of the Authority on May 9, 2023 (the "Authorizing Resolution"), authorizing the issuance and sale of the Series 2023A Bonds in an aggregate principal amount not to exceed $225,000,000, approving the form of and authorizing the execution and delivery of the Financing Documents, and delegating to the Executive Director and the Chief Financial Officer certain authority with respect to the final terms of the Bonds and the execution and delivery of documents relating thereto.
(ii) Chapter 43.160A of the Revised Code of Washington (the "Enabling Act"), being the statutory authority under which the Authority was created and under which it operates and issues its revenue obligations.
(iii) The Preliminary Official Statement dated June 26, 2023, relating to the Series 2023A Bonds (the "Preliminary Official Statement") and the Final Official Statement dated September 5, 2023, relating to the Series 2023A Bonds (the "Official Statement"), each prepared by the Authority in connection with the public offering of the Bonds by the Underwriters.
(iv) Certificate of Authorized Officer of the Authority, executed by Harold K. Nakamura, Executive Director, dated October 24, 2023 (the "Certificate of Authorized Officer"), certifying as to certain factual matters relevant to the opinions expressed herein, including the absence of litigation and the accuracy of certain representations and warranties.
(v) Certificate of the Chief Financial Officer of the Authority, executed by Denise R. Whitford, Chief Financial Officer, dated October 24, 2023 (the "CFO's Certificate"), certifying compliance with the rate covenant and the additional bonds test set forth in the Indenture with respect to the issuance of the Series 2023A Bonds.
(vi) State Environmental Policy Act ("SEPA") Determination of Non-Significance issued by the Washington State Department of Ecology on September 12, 2022, with respect to the Puget Sound Regional Advanced Water Treatment Facility project to be financed with a portion of the proceeds of the Series 2023A Bonds.
(vii) National Pollutant Discharge Elimination System ("NPDES") Permit No. WA-004837-2 modification approved by the Washington State Department of Ecology on January 6, 2023, authorizing the discharge of treated effluent from the Puget Sound Regional Advanced Water Treatment Facility.
(viii) Design-Build Contract (Guaranteed Maximum Price) No. CSIA-DB-2023-001, by and between the Authority and Northtide Environmental Engineering, Inc., dated March 10, 2023, in the guaranteed maximum price amount of $193,500,000, for the design and construction of the Puget Sound Regional Advanced Water Treatment Facility located at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501.
(ix) The audited financial statements of the Authority for the fiscal year ended June 30, 2022, including the independent auditor's report thereon issued by Hargrove & Associates CPAs, PLLC.
(x) Such other documents, certificates, records, instruments, and matters of law as we have deemed necessary or appropriate for the purposes of the opinions expressed herein.
(xi) Rating letters from Lakeshore Ratings Group, Inc., assigning an underlying long-term rating of "AA" with a stable outlook to the Series 2023A Bonds, and from Pinnacle Credit Analytics, Inc., assigning an underlying long-term rating of "AA−" with a stable outlook to the Series 2023A Bonds, each dated July 28, 2023.
1.3 Key Defined Terms
For purposes of this opinion, the following terms shall have the meanings set forth below:
The Series 2023A Bonds bear interest at a fixed rate of 3.25% per annum, computed on the basis of a 360-day year consisting of twelve 30-day months. The Bonds mature on October 1, 2053, and are subject to optional redemption prior to maturity, in whole or in part on any date, at a redemption price equal to 100% of the principal amount thereof plus accrued interest to the date of redemption, on or after October 1, 2033. The Bonds were issued in fully registered form in authorized denominations of $5,000 or any integral multiple thereof and are registered through the book-entry system of The Depository Trust Company ("DTC"), with Cede & Co. as the sole registered owner of the Bonds. The CUSIP base number assigned to the Bonds is 148392.
The Authority's employer identification number is 91-2058374. The aggregate principal amount of the Series 2023A Bonds is $220,000,000. As of the date hereof, and after giving effect to the issuance of the Series 2023A Bonds, the total outstanding parity revenue obligations of the Authority equal $3,340,000,000 (consisting of $3,120,000,000 of prior parity obligations outstanding immediately prior to this issuance plus the $220,000,000 of Series 2023A Bonds issued on the date hereof).
Section 2. Assumptions
In rendering the opinions set forth in Section 3 below, we have, with your consent and without independent investigation or verification, made and relied upon the following assumptions:
(a) We have assumed the genuineness of all signatures (other than those of the Authority and its officers and agents), the legal capacity of all natural persons, the authenticity of all documents submitted to us as originals, and the conformity to authentic originals of all documents submitted to us as copies (whether certified, conformed, photostatic, electronic, or otherwise).
(b) We have assumed that each party to the Financing Documents (other than the Authority) has the requisite power, authority, and legal right to enter into, execute, deliver, and perform its respective obligations under the Financing Documents to which it is a party, and that each such Financing Document has been duly authorized by all necessary action on the part of each such party (other than the Authority), has been duly executed and delivered by such party, and constitutes a legal, valid, and binding obligation of such party enforceable against such party in accordance with its terms.
(c) We have assumed that Pacific Northwest Trust Company, National Association has been duly organized and is validly existing as a national banking association under the laws of the United States of America, and that it has all requisite fiduciary and trust powers necessary to accept the trusts created under the Indenture and to serve as Trustee, Dissemination Agent, and Escrow Agent as contemplated by the Financing Documents.
(d) We have assumed the due authorization, execution, and delivery of the Surety Bond (Policy No. OG-2023-MUN-4718) by Olympia Guaranty Insurance Corp., and that such surety bond constitutes a legal, valid, and binding obligation of Olympia Guaranty Insurance Corp. enforceable in accordance with its terms.
(e) We have assumed the accuracy and completeness of all factual representations, warranties, and certifications contained in the Certificate of Authorized Officer and the CFO's Certificate, each delivered on the date hereof, without independent investigation or verification of such facts.
(f) We have assumed that no event has occurred since the date of the documents and certificates examined by us that would alter the facts or circumstances set forth therein in any material respect.
Section 3. Opinions
Based upon and subject to the foregoing, and subject to the qualifications, limitations, and exceptions set forth in Section 4 below, we are of the opinion that:
3.1 Due Organization and Valid Existence
The Cascadia State Infrastructure Authority is a duly created and validly existing governmental instrumentality and public body corporate of the State of Washington, organized and operating pursuant to the provisions of the Enabling Act (Chapter 43.160A of the Revised Code of Washington), as amended to the date hereof. The Authority has full legal right, power, and authority under the Enabling Act and other applicable provisions of the laws of the State of Washington to carry out its governmental functions and purposes as described in and contemplated by the Enabling Act, including, without limitation, the acquisition, construction, financing, operation, and maintenance of water treatment facilities and related infrastructure for the benefit of the citizens and communities of the State of Washington. The Authority maintains its principal offices at 1100 Capitol Way South, Suite 400, Olympia, Washington 98501.
3.2 Power and Authority to Issue the Bonds
The Authority has full legal right, power, and authority under the Enabling Act and other applicable provisions of the Revised Code of Washington to:
(i) issue the Series 2023A Bonds in the aggregate principal amount of $220,000,000;
(ii) pledge net water-treatment revenues of the Authority as security for the payment of the principal of, premium, if any, and interest on the Series 2023A Bonds on a parity basis with the Authority's existing outstanding parity revenue obligations;
(iii) enter into and perform its obligations under each of the Financing Documents; and
(iv) carry out and consummate the transactions contemplated by the Financing Documents, including, without limitation, the financing of the design, construction, equipping, testing, and commissioning of the Puget Sound Regional Advanced Water Treatment Facility, an advanced tertiary water treatment facility located at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501, and related improvements to the Authority's regional water treatment system.
3.3 Due Authorization
The issuance and sale of the Series 2023A Bonds and the execution and delivery of each of the Financing Documents have been duly authorized by all necessary action on the part of the Authority, including, without limitation, the adoption of the Authorizing Resolution (Board Resolution No. 2023-014) by the Board of Directors of the Authority on May 9, 2023. The Authorizing Resolution was duly adopted at a meeting of the Board of Directors at which a quorum was present and acting throughout, under the chairmanship of Commissioner Lorraine Chu, and in compliance with the procedural requirements of the Enabling Act and the Authority's bylaws. The Authorizing Resolution authorized the issuance of the Series 2023A Bonds and approved the form of and authorized the execution and delivery of the Financing Documents, and delegated to Harold K. Nakamura, Executive Director, and Denise R. Whitford, Chief Financial Officer, the authority to determine the final terms and conditions of the Bonds and to execute and deliver all documents and instruments necessary or appropriate to effectuate the transactions contemplated by the Authorizing Resolution.
No further approval, consent, authorization, or order of any court, governmental authority, legislative body, regulatory agency, or public board is required for the valid issuance and delivery of the Series 2023A Bonds or for the execution and delivery of any of the Financing Documents by the Authority, other than such approvals, consents, and authorizations as have been duly obtained, given, or taken and remain in full force and effect as of the date hereof.
3.4 Valid Execution and Delivery
Each of the Financing Documents has been duly executed and delivered by authorized officers of the Authority, specifically as follows:
(a) The Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, the Continuing Disclosure Agreement, the Escrow Deposit Agreement, and the Surety Bond Agreement were each executed on behalf of the Authority by Harold K. Nakamura, Executive Director, on October 24, 2023, each acting within the scope of the authority delegated to him by the Authorizing Resolution.
(b) The Bond Purchase Agreement was executed on behalf of the Authority by Harold K. Nakamura, Executive Director, on August 30, 2023, acting within the scope of the authority delegated to him by the Authorizing Resolution.
(c) The Tax Regulatory Agreement and Certificate was executed on behalf of the Authority by Harold K. Nakamura, Executive Director, and Denise R. Whitford, Chief Financial Officer, on October 15, 2023, each acting within the scope of the authority delegated to them by the Authorizing Resolution.
Each such officer was, at the time of such execution, a duly appointed officer of the Authority authorized to execute such documents on behalf of the Authority.
3.5 Enforceability.  Each of the Financing Documents constitutes a legal, valid, and binding obligation of the Authority, enforceable against the Authority in accordance with its respective terms, subject to the qualifications, limitations, and exceptions set forth in Section 4 below.
The Series 2023A Bonds, having been duly authorized, executed, and issued by the Authority and duly authenticated by PNTC, as Trustee, and having been delivered to and paid for by the Underwriters in accordance with the terms of the Indenture, the First Supplemental Indenture, and the Bond Purchase Agreement, constitute legal, valid, and binding special, limited obligations of the Authority, payable solely from the sources pledged therefor under the Indenture and the Revenue Pledge Agreement, and are enforceable against the Authority in accordance with their terms, subject to the qualifications, limitations, and exceptions set forth in Section 4 below. The Series 2023A Bonds are entitled to the benefits and security of the Indenture, the First Supplemental Indenture, and the Revenue Pledge Agreement.
The Series 2023A Bonds do not constitute a debt or liability of the State of Washington or of any political subdivision thereof other than the Authority, and neither the faith and credit nor the taxing power of the State of Washington or of any political subdivision thereof is pledged to the payment of the principal of, premium, if any, or interest on the Series 2023A Bonds.
3.6 Validity of Revenue Pledge
The pledge of net water-treatment revenues created by the Revenue Pledge Agreement and the Indenture constitutes a valid pledge of such revenues for the benefit of the holders of the Series 2023A Bonds. As used herein, "net water-treatment revenues" means the gross revenues derived by the Authority from the ownership and operation of its regional water treatment system, including, without limitation:
(a) wholesale water treatment service charges from the fourteen (14) participating municipal water districts;
(b) connection fees and capacity charges;
(c) investment earnings on funds and accounts held under the Indenture and pledged to the payment of the Bonds; and
(d) all other income and revenues derived from or attributable to the Authority's water treatment system,
after deduction of operation and maintenance expenses of the system as defined in the Indenture.
Such pledge secures the Series 2023A Bonds on a parity basis with all other outstanding parity revenue obligations of the Authority heretofore issued under the Indenture or any prior indenture. As of the date hereof, the total outstanding parity revenue obligations of the Authority (including the Series 2023A Bonds) are $3,340,000,000, consisting of $3,120,000,000 of prior parity obligations and the $220,000,000 of Series 2023A Bonds.
The rate covenant contained in Section 5.02 of the Revenue Pledge Agreement requires the Authority to establish, fix, prescribe, and collect rates, fees, and charges for the use and services of the regional water treatment system which are reasonably expected to produce, in each fiscal year, net pledged revenues of not less than 1.40 times (1.40x) the annual aggregate parity debt service due and payable in such fiscal year on all outstanding parity obligations of the Authority.
3.7 No Conflicts or Violations
The execution and delivery of the Financing Documents and the issuance, sale, and delivery of the Series 2023A Bonds by the Authority, and the consummation of the transactions contemplated thereby, do not and will not:
(i) violate or conflict with the Enabling Act or any other applicable law, rule, regulation, order, writ, judgment, injunction, or decree of the State of Washington or of the United States of America known to us to be applicable to the Authority or the transactions contemplated by the Financing Documents;
(ii) violate, conflict with, result in a breach of, or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, any resolution, agreement, indenture, mortgage, deed of trust, lease, or other instrument or agreement to which the Authority is a party or by which the Authority or any of its properties or revenues are bound, including, without limitation, any existing bond indenture, supplemental indenture, or resolution authorizing or securing any outstanding parity revenue obligations of the Authority; or
(iii) result in the creation or imposition of any lien, charge, encumbrance, security interest, or restriction upon any property or revenues of the Authority other than the lien and pledge expressly created by the Indenture and the Revenue Pledge Agreement for the benefit of the holders of the Series 2023A Bonds and any other parity obligations issued thereunder.
3.8 No Litigation
Based solely upon our review of the Certificate of Authorized Officer delivered by Harold K. Nakamura, Executive Director of the Authority, on the date hereof, and without independent investigation or verification, to our knowledge there is no action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, public board, governmental authority, or regulatory body, pending or, to the knowledge of the officers of the Authority, threatened against or affecting the Authority, which:
(i) challenges or questions the creation, organization, or existence of the Authority or the title of any of its officers to their respective offices;
(ii) contests or questions the authority of the Authority to issue the Series 2023A Bonds or to execute and deliver any of the Financing Documents, or to carry out the transactions contemplated thereby;
(iii) contests or questions the validity or enforceability of the Series 2023A Bonds, the Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, or any of the other Financing Documents; or
(iv) would, if adversely determined, materially adversely affect the financial condition of the Authority, the ability of the Authority to perform its obligations under the Financing Documents, or the pledged revenues securing the Series 2023A Bonds.
3.9 Governmental Approvals
All governmental approvals, consents, authorizations, orders, filings, registrations, and permits required under applicable law for the issuance, sale, and delivery of the Series 2023A Bonds and for the execution and delivery of the Financing Documents have been duly obtained, made, or given by or on behalf of the Authority, including, without limitation:
(i) CSIA Board Resolution No. 2023-014, duly adopted by the Board of Directors of the Authority on May 9, 2023, authorizing the issuance and sale of the Series 2023A Bonds and the execution and delivery of the Financing Documents;
(ii) the SEPA Determination of Non-Significance issued by the Washington State Department of Ecology on September 12, 2022, with respect to the Puget Sound Regional Advanced Water Treatment Facility project; and
(iii) the NPDES Permit No. WA-004837-2 modification approved by the Washington State Department of Ecology on January 6, 2023, authorizing the discharge of treated effluent from the Puget Sound Regional Advanced Water Treatment Facility.
All such approvals, consents, authorizations, orders, filings, registrations, and permits remain in full force and effect as of the date hereof, have not been revoked, modified, amended, or rescinded, and are not the subject of any pending or, to the knowledge of the Authority, threatened proceedings seeking their revocation, modification, or rescission.
3.10 Additional Bonds Test Compliance
Based upon our review of the CFO's Certificate dated October 24, 2023, executed by Denise R. Whitford, Chief Financial Officer of the Authority, and delivered on the date hereof, the additional bonds test set forth in Article III of the Indenture has been satisfied with respect to the issuance of the Series 2023A Bonds. Specifically:
(a) The Authority's net pledged revenues for the most recently completed fiscal year (fiscal year ended June 30, 2022) were $412,600,000, calculated as follows:
(b) Total annual parity debt service on all outstanding parity obligations (including the Series 2023A Bonds) is $278,400,000, which includes the approximately $11,610,000 of estimated annual debt service on the Series 2023A Bonds.
(c) The resulting debt-service coverage ratio is as follows:
(d) The calculated debt-service coverage ratio of approximately 1.48x exceeds the minimum coverage ratio of 1.40x required by the additional bonds test set forth in the Indenture.
We have relied upon the CFO's Certificate for the financial data and calculations set forth above and have not independently verified such data or calculations.
Section 4. Qualifications, Limitations, and Exceptions
The opinions expressed in Section 3 above are subject to the following qualifications, limitations, and exceptions:
4.1 Bankruptcy and Insolvency Qualification
The opinions expressed in paragraphs 3.5 and 3.6 above with respect to the enforceability of the Financing Documents and the Series 2023A Bonds are subject to and limited by: (a) applicable bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer, and other similar laws affecting the enforcement of creditors' rights generally, as from time to time in effect; (b) the effect of general principles of equity (including, without limitation, concepts of materiality, good faith, fair dealing, reasonableness, and the possible unavailability of specific performance or injunctive relief), regardless of whether considered in a proceeding in equity or at law; and (c) the exercise of judicial discretion and the limitations of applicable law in certain circumstances upon the availability of certain equitable remedies, including, without limitation, the remedy of specific performance. We express no opinion as to whether a court would enforce any provision of the Financing Documents that purports to waive or limit rights to jury trial, choice of venue, or the jurisdiction of any particular court.
4.2 Scope of Law Covered
This opinion is limited in all respects to the laws of the State of Washington and the federal laws of the United States of America, each as in effect on the date hereof, and we express no opinion as to the laws of any other jurisdiction. We note that we have not, for purposes of this opinion, reviewed or analyzed the securities laws of any state (commonly referred to as "Blue Sky" laws) or any federal securities laws, including, without limitation, the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended (other than Rule 15c2-12 promulgated thereunder to the extent relevant to the Continuing Disclosure Agreement), and we express no opinion with respect thereto.
4.3 No Tax Opinion
We express no opinion herein as to the excludability of interest on the Series 2023A Bonds from gross income for purposes of federal income taxation under Section 103 of the Internal Revenue Code of 1986, as amended, or as to any other federal, state, or local tax consequences of the ownership or disposition of the Bonds. The opinion as to the tax-exempt status of interest on the Series 2023A Bonds for federal income tax purposes is being separately rendered by Pryor Crestfield LLP and Calderwood & Harkness LLP in their capacity as Co-Bond Counsel to the Authority, in a separate opinion letter dated the date hereof and delivered at the closing of the issuance and sale of the Series 2023A Bonds.
4.4 No Opinion on Certain Parties
We have served as counsel only to the Authority in connection with the transactions described herein, and we express no opinion as to the due organization, valid existence, good standing, qualification, power, authority, or capacity of Pacific Northwest Trust Company, National Association, Olympia Guaranty Insurance Corp., Meridian Capital Partners LLC, Dralvecen Fenn & Co., Inc., Northtide Environmental Engineering, Inc., or any other person or entity (other than the Authority). We express no opinion as to whether any such party has duly authorized, executed, or delivered any document or instrument to which it is a party, or as to the enforceability of any such document or instrument against any such party.
4.5 Reliance on Certificates
In rendering the opinions set forth in paragraphs 3.8 (No Litigation) and 3.10 (Additional Bonds Test Compliance), we have relied entirely upon the Certificate of Authorized Officer and the CFO's Certificate, each delivered on the date hereof, without independent investigation, inquiry, or verification of the matters set forth therein. To the extent that the accuracy of the opinions expressed in such paragraphs depends upon factual matters, our opinions are limited by, and subject to, the accuracy and completeness of such certificates. We assume no responsibility for, and express no opinion with respect to, the accuracy or completeness of any financial data, projections, or calculations set forth in such certificates or in any other document examined by us.
4.6 Security Interest Perfection
We note that the enforceability and perfection of the pledge of revenues under the Revenue Pledge Agreement and the Indenture, including, without limitation, the priority of such pledge and the creation of a perfected security interest in favor of the Trustee and the holders of the Bonds in the pledged revenues, is addressed in a separate opinion letter of this firm dated the date hereof (the "Enforceability Opinion — Revenue Pledge Agreement"), and we express no opinion herein with respect to such matters except to the extent expressly set forth in paragraph 3.6 above. The opinion set forth in paragraph 3.6 is subject to and qualified by the opinions and qualifications set forth in such separate opinion letter.
Section 5. Reliance and Distribution
This opinion is rendered solely for the benefit of the addressees named herein — the Cascadia State Infrastructure Authority, Pacific Northwest Trust Company, National Association (as Trustee), Meridian Capital Partners LLC (as Senior Managing Underwriter and Representative of the Underwriters), and Dralvecen Fenn & Co., Inc. (as Co-Managing Underwriter) — and their respective successors and assigns, in each case solely in connection with the transaction described herein. This opinion may not be relied upon by any other person or entity, or used, quoted, circulated, or referred to for any other purpose, without our prior written consent in each instance, except that this opinion may be included as an exhibit to a closing transcript for the Series 2023A Bonds and may be referred to in the Official Statement.
This opinion is given as of the date hereof, and we undertake no obligation, and hereby disclaim any obligation, to update, revise, or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention or any changes in applicable law (whether by legislative action, judicial decision, administrative action, or otherwise) that may hereafter occur. Our opinions are expressly limited to the matters set forth herein, and no opinion is to be implied or inferred beyond the matters expressly stated herein.
This opinion may be relied upon by the addressees hereof only in connection with the issuance, sale, and delivery of the Series 2023A Bonds and the execution and delivery of the Financing Documents as described herein, and not in connection with any subsequent transaction, including any remarketing, resale, transfer, exchange, or refunding of the Series 2023A Bonds.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Name: George Trujillo
Title: Partner
1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101 Telephone: (206) 442-7800 C&H Matter No. 1030-00001
Amount
FY 2022 Gross Pledged Revenues | $489,300,000
Less: FY 2022 Operation & Maintenance Expenses | ($76,700,000)
FY 2022 Net Pledged Revenues | $412,600,000
FY 2022 Net Pledged Revenues | $412,600,000
Total Annual Parity Debt Service (including Series 2023A Bonds) | $278,400,000
Debt-Service Coverage Ratio | 1.48x

CALDERWOOD & HARKNESS LLP Attorneys at Law

CALDERWOOD & HARKNESS LLP

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