Supplement dated February 23, 2017 to Preliminary Official Statement dated February 14, 2017 with respect to ALABAMA STATE PORT AUTHORITY $125,625,000* DOCKS FACILITIES REVENUE REFUNDING BONDS, SERIES 2017A (AMT), $13,950,000* DOCKS FACILITIES REVENUE REFUNDING BONDS, SERIES 2017B (NON-AMT), $7,910,000* DOCKS FACILITIES REVENUE REFUNDING BONDS, SERIES 2017C (NON-AMT), AND $133,260,000* DOCKS FACILITIES REVENUE REFUNDING BONDS, SERIES 2017D (TAXABLE) INTRODUCTION This Supplement is intended to supplement the Preliminary Official Statement, dated February 14, 2017 (the “POS”), relating to the issuance of the above-referenced bonds (the “Series 2017 Bonds”) by the Alabama State Port Authority (the “Authority”). All capitalized terms used in this Supplement and not defined herein shall have the meaning specified in the POS unless the context or use clearly indicates otherwise. This Supplement is not intended to be read alone. Instead, this Supplement is intended to be read in conjunction with the information contained in the POS. This Supplement is not intended to act as a substitute for or as a replacement of the information contained in the POS except as expressly provided herein. RECENT EVENT On February 21, 2017 an employee of the Authority inadvertently released sensitive personnel information, via an email, to an unauthorized recipient in response to a phishing email. The information released includes names, addresses, social security numbers and 2016 compensation information. No customer data was involved in this matter and the Authority’s systems were not compromised. The Authority has taken and continues to take steps to protect against adverse consequences to its employees and retirees, including notifying federal and state authorities and securing assistance for the affected personnel from an identity theft protection service, and is in the process of providing notice to the employees of the occurrence and of actions taken by the Authority and advice as to protective steps to be taken by the employees and retirees. Nevertheless, management expects that there could be instances of identity theft and adverse consequences to employees and/or retirees. While this incident will result in some near-term expenses, the Authority does not expect that this matter will result in a material adverse impact on the financial condition or operations of the Authority. ADDITIONAL INFORMATION For further information during the initial offering period with respect to the Series 2017 Bonds, contact Larry R. Downs, Secretary-Treasurer and Chief Financial Officer, Alabama State Port Authority, 250 North Water Street, Mobile, Alabama 36602 (telephone: (251) 441-7050). * Preliminary; subject to change. 03943645.2 –n PRELIMINARY OFFICIAL STATEMENT DATED FEBRUARY 14, 2017 No TIOdicti NEW ISSUES (4) - BOOK ENTRY ONLY RATINGS (See Ratings herein): Cs Uuri Underlying: S&P: A- (stable outlook) e prior to the delivery of these securities. 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UMB Bank, N.A. ALABAMA STATE PORT AUTHORITY $125,625,000* Docks Facilities Revenue Refunding Bonds, Series 2017A (AMT) MATURITIES, AMOUNTS, RATES, PRICES & CUSIP NUMBERS Maturity Principal Amount Interest Rate Price or Yield CUSIP 2017 $2,135,000 2023** 7,065,000 2024** 7,420,000 2025** 7,790,000 2026** 8,180,000 2027** 8,420,000 2028** 8,840,000 2029** 9,280,000 2030** 8,805,000 2031** 10,440,000 2032** 10,965,000 2033** 11,510,000 2034** 12,090,000 2035** 12,685,000 _______________________________ $13,950,000* Docks Facilities Revenue Refunding Bonds, Series 2017B (Non-AMT) MATURITIES, AMOUNTS, RATES, PRICES & INITIAL CUSIPS Maturity Principal Amount Interest Rate Price or Yield CUSIP 2018 $4,050,000 2019 4,295,000 2020 4,565,000 2021 1,040,000 _______________________________ * Preliminary, subject to change. ** Insured Bonds. $7,910,000* Docks Facilities Revenue Refunding Bonds, Series 2017C (Non-AMT) MATURITIES, AMOUNTS, RATES, PRICES & INITIAL CUSIPS Maturity Principal Amount Interest Rate Price or Yield CUSIP 2022 $10,000 2023** 10,000 2024** 10,000 2025** 10,000 2026** 15,000 2027** 15,000 2028** 15,000 2029** 15,000 2030** 15,000 2031** 15,000 2032** 15,000 2033** 15,000 2034** 20,000 2035** 20,000 2036** 7,710,000 _______________________________ $133,260,000* Docks Facilities Revenue Refunding Bonds, Series 2017D (Taxable) MATURITIES, AMOUNTS, RATES, PRICES & INITIAL CUSIPS Maturity Principal Amount Interest Rate Price or Yield CUSIP 2017 $725,000 2018 1,050,000 2019 1,065,000 2020 1,085,000 2021 4,910,000 2022 13,895,000 2023** 2,155,000 2024** 2,235,000 2025** 2,320,000 2026** 2,415,000 2027** 2,125,000 2028** 2,215,000 2029** 2,315,000 2030** 2,425,000 2031** 2,845,000 2032** 2,965,000 2033** 3,115,000 2034** 3,275,000 2035** 3,445,000 2036** 3,620,000 2037** 18,890,000 2038** 19,840,000 2039** 20,825,000 2040** 13,505,000 * Preliminary, subject to change. ** Insured Bonds. Assured Guaranty Municipal Corp. (“AGM”) makes no representation regarding the Series 2017 Bonds or the advisability of investing in the Series 2017 Bonds. In addition, AGM has not independently verified, makes no representation regarding, and does not accept any responsibility for the accuracy or completeness of this Official Statement or any information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the information regarding AGM supplied by AGM and presented under the heading “Bond Insurance” and “Appendix F- Specimen Municipal Bond Insurance Policy The Underwriters have provided the following sentence for inclusion in this Official Statement. The Underwriters have reviewed the information in this Official Statement in accordance with and as part of its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the accuracy or completeness of such information. . ______________________________ ALABAMA STATE PORT AUTHORITY Members of the Board of Directors Horace H. Horn, Jr., Chairman Joe McCarty, 1st Vice Chairman Ben C. Stimpson, 2nd Vice Chairman Daryl H. Dewberry Alvin K. Hope II Tim Parker, III Algernon “Al” Stanley Bestor Ward Mobile Mayor Sandy Stimpson (Ex-Officio) James K. Lyons Director and Chief Executive Officer Larry R. Downs Secretary-Treasurer and Chief Financial Officer _______________________________ FINANCIAL ADVISOR Pinnacle Financial Group, LLC Rowayton, Connecticut ______________________________ FEASIBILITY CONSULTANT MICP Capital San Francisco, California ______________________________ BOND COUNSEL AND COUNSEL FOR THE AUTHORITY Hand Arendall LLC Mobile, Alabama ______________________________ INDEPENDENT ACCOUNTANTS Warren Averett, LLC Birmingham, Alabama _______________________________ COUNSEL TO THE UNDERWRITERS Maynard, Cooper & Gale, P.C. Birmingham, Alabama _______________________________ [THIS PAGE INTENTIONALLY LEFT BLANK.] TABLE OF CONTENTS Page INTRODUCTION ......................................................................................................................................................... 1 General ...................................................................................................................................................................... 1 Changes to the Preliminary Official Statement ......................................................................................................... 2 GLOSSARY OF TERMS USED IN OFFICIAL STATEMENT .................................................................................. 2 THE PLAN OF FINANCING ....................................................................................................................................... 4 General ...................................................................................................................................................................... 4 Refunding Plan ......................................................................................................................................................... 4 SOURCES AND USES OF FUNDS ............................................................................................................................. 5 Series 2017A Bonds ................................................................................................................................................. 5 Series 2017B Bonds .................................................................................................................................................. 5 Series 2017C Bonds .................................................................................................................................................. 5 Series 2017D Bonds ................................................................................................................................................. 6 DESCRIPTION OF THE SERIES 2017 BONDS ......................................................................................................... 6 General Provisions .................................................................................................................................................... 6 Method and Place of Payment .................................................................................................................................. 6 Redemption of Series 2017A Bonds Prior to Maturity ............................................................................................. 7 Redemption of Series 2017B Bonds Prior to Maturity ............................................................................................. 7 Redemption of Series 2017C Bonds Prior to Maturity ............................................................................................. 8 Redemption of Series 2017D Bonds Prior to Maturity ............................................................................................. 9 General Redemption Provisions ............................................................................................................................... 9 Registration and Exchange ..................................................................................................................................... 10 Book-Entry Only System ........................................................................................................................................ 10 Authority for Issuance ............................................................................................................................................ 10 Amendments to Bond Order ................................................................................................................................... 10 SECURITY AND SOURCE OF PAYMENT ............................................................................................................. 11 General .................................................................................................................................................................... 11 Description of Docks Facilities Revenues .............................................................................................................. 11 Debt Service Reserve Fund ..................................................................................................................................... 12 Maintenance of Rates and Charges ......................................................................................................................... 12 Establishment of Rates and Charges ....................................................................................................................... 13 Swap Transaction .................................................................................................................................................... 13 Additional Senior Lien Bonds ................................................................................................................................ 13 Subordinate Obligations ......................................................................................................................................... 13 The United States Bankruptcy Code ....................................................................................................................... 13 BOND INSURANCE .................................................................................................................................................. 14 AVAILABLE STATE TAX REVENUES .................................................................................................................. 16 General .................................................................................................................................................................... 16 Coal Severance Tax ................................................................................................................................................ 16 Oil and Gas Severance Tax ..................................................................................................................................... 17 OTHER GOVERNMENTAL SUPPORT ................................................................................................................... 18 Conditional Appropriations .................................................................................................................................... 18 Capital Grants ......................................................................................................................................................... 18 DEBT SERVICE REQUIREMENTS AND COVERAGE ......................................................................................... 19 Debt Service ........................................................................................................................................................... 19 Historical Coverage ................................................................................................................................................ 20 Pro Forma and Projected Coverage ........................................................................................................................ 20 FINANCIAL SYSTEM ............................................................................................................................................... 21 FINANCIAL CONDITION AND RESULTS OF OPERATIONS ............................................................................. 21 General .................................................................................................................................................................... 21 Statements of Revenues, Expenses, and Changes in Net Assets/Statements of Net Assets .................................... 21 Management’s Discussion and Analysis – Fiscal Years 2015 and 2016 ................................................................ 24 Management’s Discussion and Analysis – Three Months Ended December 31, 2015 and 2016 ........................... 24 Contingent Liabilities ............................................................................................................................................. 24 THE AUTHORITY ..................................................................................................................................................... 25 General .................................................................................................................................................................... 25 Management ........................................................................................................................................................... 25 Employee Relations ................................................................................................................................................ 28 Insurance and Risk Management ............................................................................................................................ 30 AUTHORITY OPERATIONS .................................................................................................................................... 30 General .................................................................................................................................................................... 30 Competitive Position on the Gulf of Mexico .......................................................................................................... 31 General Note Regarding Description of Authority Facilities.................................................................................. 31 Turning Basins ........................................................................................................................................................ 31 Coal Handling and Storage Facilities ..................................................................................................................... 32 General Cargo/Intermodal Facilities ....................................................................................................................... 34 Bulk Material Handling and Warehouse Facilities ................................................................................................. 35 Terminal Railway Facilities .................................................................................................................................... 36 Marine Liquid Bulk Terminal Facilities ................................................................................................................. 36 Other Existing Facilities ......................................................................................................................................... 36 Recently Completed Authority Facilities ................................................................................................................ 37 Five-Year Capital Plan ........................................................................................................................................... 37 Environmental Impact and Policy ........................................................................................................................... 38 Hurricane Preparedness .......................................................................................................................................... 38 Security ................................................................................................................................................................... 39 LITIGATION .............................................................................................................................................................. 39 RISK FACTORS ......................................................................................................................................................... 39 General .................................................................................................................................................................... 39 Authority’s Immunity from Suits to Enforce Payment of Bonds and Other Obligations ....................................... 40 Dependence on Market Conditions and Political Climate ...................................................................................... 40 Feasibility Report .................................................................................................................................................... 40 Dependence on Certain State Tax Revenues .......................................................................................................... 40 Hurricanes and Other Severe Weather .................................................................................................................... 41 Other Risks of Loss, Damage or Destruction ......................................................................................................... 41 Costs Associated with Enhanced Security Precautions .......................................................................................... 41 Financial Performance and Capital Commitments ................................................................................................. 42 Environmental Regulation ...................................................................................................................................... 42 Competition ............................................................................................................................................................ 42 Termination or Expiration of Material Contracts.................................................................................................... 42 Regulatory Factors Affecting Coal Industry ........................................................................................................... 42 Tax-Exempt Status of Series 2017A Bonds, Series 2017B Bonds, and Series 2017C Bonds ................................ 42 Employee Relations ................................................................................................................................................ 43 State Legislative Control ........................................................................................................................................ 43 The United States Bankruptcy Code ....................................................................................................................... 43 ii ECONOMIC AND DEMOGRAPHIC INFORMATION ........................................................................................... 44 General .................................................................................................................................................................... 44 Population ............................................................................................................................................................... 44 Employment ............................................................................................................................................................ 45 Income Levels ......................................................................................................................................................... 46 Education ................................................................................................................................................................ 46 Utilities ................................................................................................................................................................... 47 Transportation ......................................................................................................................................................... 47 LEGAL MATTERS .................................................................................................................................................... 48 TAX MATTERS ......................................................................................................................................................... 48 Series 2017A Bonds, Series 2017B Bonds and Series 2017C Bonds ..................................................................... 48 Certain Collateral Federal Tax Consequences ........................................................................................................ 49 Original Issue Discount .......................................................................................................................................... 49 Premium .................................................................................................................................................................. 49 Series 2017D Bonds ............................................................................................................................................... 49 VERIFICATION OF CERTAIN COMPUTATIONS RELATING TO SERIES 2017 BONDS ................................ 50 UNDERWRITING ...................................................................................................................................................... 50 CONTINUING DISCLOSURE ................................................................................................................................... 51 General .................................................................................................................................................................... 51 Compliance with Prior Undertakings ...................................................................................................................... 52 RATINGS .................................................................................................................................................................... 52 REPORT OF FEASIBILITY CONSULTANT ........................................................................................................... 53 INDEPENDENT ACCOUNTANTS ........................................................................................................................... 53 FINANCIAL ADVISOR ............................................................................................................................................. 53 DISCLAIMERS AND OTHER MISCELLANEOUS MATTERS ............................................................................. 53 ADDITIONAL INFORMATION ............................................................................................................................... 55 Appendix A – Audited Financial Statements of the Authority for the fiscal years ended September 30, 2015 and September 30, 2016 Appendix B – Report of Feasibility Consultant Appendix C – Book-Entry Only System Appendix D – Summary of the Bond Order Appendix E – Proposed Opinions of Bond Counsel Appendix F – Specimen Municipal Bond Insurance Policy iii