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HomeMy WebLinkAboutO-2484 - Authorizes issuance of general obligation bonds (Special)", CITY OF MARYSVILLE, WASHINGTON ORDINANCE NO.;)''lJy AN ORDINANCE of the City of Marysville, Washington, relating to contracting indebtedness; providing for the issuance of the $1,740,982 par value Limited Tax General Obligation Bond, 2003 (Taxable),of the City for general City purposes to provide the funds with which to payor reimburse earlier City expenditures for costs of golf course facilities, including but not limited to restaurant, pro shop and parking lot improvements, and paying the costs of issuance and sale of such bond; fixing the date, form, maturity, interest rate, terms and covenants of the bond; designating a construction fund and establishing a bond fund; and approving the sale and providing for the delivery of the bond to Bank of America, N A,of Seattle, Washington. PASSED: JULY 28, 2003 This document prepared by: Foster Pepper &Shefelman PLLe 1111 Third Avenue Seattle, WA 98101 (206)447-4400 , TABLE OF CONTENTS Section 1.Definitions 2 Section 2. Debt Capacity ,3 Section 3.Authorization of Bond , ,3 Section 4. Description of Bond 4 Section 5. Registration and Transfer of Bond; Bond Registrar 4 Section 6. Payment of Bond ,,5 Section 7. Optional Prepayment and Redemption of Bond 6 Section 8. Failure To Pay Installments 6 Section 9. Pledge of Taxes ,6 Section 10. Form and Execution of Bond 7 Section 11. Refunding or Defeasance of the Bond 8 Section 12.Construction Fund and Deposit and Use of Bond Proceeds 8 Section 13. Approval of Transaction 9 Section 14. Effective Date of Ordinance 10 CITY OF MARYSVILLE, WASHINGTON ORDINANCE NO.__ AN ORDINANCE of the City of Marysville, Washington, relating to contracting indebtedness; providing for the issuance of the $1,740,982 par value Limited Tax General Obligation Bond, 2003 (Taxable),of the City for general City purposes to provide the funds with which to payor reimburse earlier City expenditures for costs of golf course facilities, including but not limited to restaurant, pro shop and parking lot improvements, and paying the costs of issuance and sale of such bond; fixing the date, form, maturity, interest rate, terms and covenants of the bond; designating a construction fund and establishing a bond fund; and approving the sale and providing for the delivery of the bond to Bank of America, N.A.,of Seattle, Washington. WHEREAS, the City of Marysville, Washington (the "City"), is in need of funds with which to payor reimburse earlier City expenditures for costs of golf course facilities, including but not limited to, restaurant, pro shop and parking lot improvements, the estimated cost of which is $1,740,982, and paying the costs of issuance ofa bond to be issued for that purpose, and the City does not have available sufficient funds to pay those costs; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF MARYSVILLE, WASHINGTON,as follows: Section I.Definitions.As used 111 this ordinance,the following words have the following meanings: "Bank"means Bank of America, N.A. "Bond"means the Limited Tax General Obligation Bond, 2003 (Taxable),of the City issued pursuant to and under the authority of and for the purposes provided in this ordinance. "Bond Fund"means the Limited Tax General Obligation Bond Fund, 2003 (Taxable), created and established by this ordinance. "Bond Registrar"means the Finance Director ofthe City. -2- 50379227.05 "City"means the City of Marysville, Washington. "Code"means the Internal Revenue Code of 1986, as amended. "Construction Fund" means the Golf Course Capital Improvement Fund 320,previously created and established. "Finance Director"means the Finance Director of the City (or the successor officer to the Finance Director). "Proposal Letter" means the commitment letter of the Bank dated July 28, 2003, describing certain conditions under which the Bank proposes to purchase the Bond. "Project"means, collectively, to payor reimburse earlier City expenditures for costs of golf course facilities, consisting of, but not limitedto, restaurant, pro shop and parking lot improvements, and including repayment of interfund loans with interest. "Registered Owner"means the Bank, as registered owner of the Bond, or any subsequent owner ofthe Bond. Section 2. Debt Capacity. The assessed valuation of the taxable property within the City as ascertained by the last preceding assessment for City purposes for the calendar year 2003 is $1,885,030,271,and the City has outstanding general indebtedness evidenced by limited tax general obligation bonds, notes, leases and conditional sales contracts in the principal amount of $3,808,929 incurred within the limit of up to 1-1/2%of the value of the taxable property within the City permitted for general municipal purposes without a vote of the qualified voters therein, and unlimited tax general obligation bonds or notes in the principal amount of $5,200,000 incurred within the limit of up to 2-1/2%of the value of the taxable property within the City for capital purposes only, and the amount of indebtedness for which bonds are authorized herein to be issued is $1,740,982. Section 3.Authorization of Bond. The City shall borrow money on the credit of the City and issue its limited tax general obligation bond evidencing that indebtedness in the amount of $] ,740,982 for general City purposes to provide the funds to payor reimburse costs of carrying out the Project and to pay the costs of issuance and sale of the Bond (the "costs of issuance"). - 3 - 5037922705 ." The general indebtedness to be incurred shall be within the limit of up to 1-1/2%of the value of the taxable property within the City permitted for general municipal purposes without a vote of the qualified voters therein. Section 4.Description of Bond, The Bond shall be called the Limited Tax General Obligation Bond, 2003 (Taxable),of the City; shall be in the aggregate principal amount of $1,740,982;shall be dated its date of delivery; shall mature fifteen years from its date of issuance not later than August 6, 2018 (the "Maturity Date"); shall be numbered R-I;shall be in fully registered form; and shall bear interest at the rate of 5.25% per annum (computed on the basis of a 360-day year for the actual number of days the principal amount is outstanding),Commencing September I, 2003, the Bond shall be payable in monthly installments 011 the first day of each month in an amount necessary to amortize with level debt service the principal of and interest on the Bond over a fifteen-year period, to and including the Maturity Date, At maturity,any remaining outstanding principal balance and accrued interest on the Bond shall be due and payable in full. The City Council finds that fixing the above interest rate is in the best interest of the City, The life of the capital facilities to be financed with the proceeds of the Bond exceeds the term of the Bond. Section 5,Registration and Transfer of Bond; Bond Registrar, The Bond shall be issued only in registered form as to both principal and interest and shall be recorded on books or records maintained by the Bond Registrar (the "Bond Register"), The Finance Director of the City shall serve as Bond Registrar for the Bond, The Bond Register shall contain the name and mailing address of the Registered Owner of the Bond, - 4 - 50379227.05 The Bond may not be assigned or transferred by the Bank without the prior written consent of the City, except that the Bank may assign or transfer the Bond to any successor to the business and assets of the Bank. The Bond Registrar shall keep, or cause to be kept, at its office in Marysville, Washington,sufficient books for the registration and transfer of the Bond.The Bond Registrar is authorized,on behalf of the City, to authenticate and deliver the Bond in accordance with the provisions of the Bond and this ordinance, to serve as the City's paying agent for the Bond and to carry out all of the Bond Registrar's powers and duties under this ordinance. The Bond Registrar shall be responsible for its representations contained in the Bond Registrar's Certificate of Authentication on the Bond. Section 6. Payment of Bond.Installments of principal of and interest on the Bond shall be payable in lawful money of the United States of America and shall be paid by check, draft or warrant of the Bond Registrar mailed five days prior to the installment payment date to the Registered Owner at the address appearing on the Bond Register on the 15 1h day of the month preceding the installment payment date or by wire transfer or electronic debit to the Registered Owner on the installment payment date. The Registered Owner shall present and surrender the Bond at the office of the Bond Registrar in Marysville, Washington, for cancellation promptly after the final installment of principal and interest on the Bond, whether at maturity or upon earlier prepayment and redemption, is paid by the City. The Bond presented and surrendered under this section shall be destroyed or cancelled in accordance with law. The City and the Bond Registrar may deem and treat the Registered Owner as the absolute owner of the Bond for the purpose of receiving payment of principal and interest and for all other purposes, and neither the City nor the Bond Registrar shall be affected by any notice to the contrary other than proper notice of assignment or transfer. - 5 - 5037922705 Section 7.Optional Prepayment and Redemption of Bond. The City reserves the right and option to prepay and redeem at any time prior to its stated maturity date any or all of the principal amount of the Bond outstanding at par plus accrued interest to the date of prepayment and redemption,subject to the payment of a potential prepayment fee as described in the Proposal Letter.Written notice to the Bank of any prepayment or redemption of the Bond shall not be required.Interest on the principal amount of the Bond called for prepayment shall cease to accrue on the dated fixed for prepayment unless the principal amount called for prepayment is not paid on the prepayment date. The amounts of the monthly payments on the Bond shall not be adjusted to reflect reamortization upon any such prepayment. Section 8.Failure To Pay Installments.If any installment of principal of and interest on the Bond is not paid when due, the City shall be obligated to pay interest on that installment at the same rate provided in the Bond until that installment,both principal and interest, is paid in full or until sufficient money for its payment in full is on deposit in the Bond Fund and the principal represented by such installments has been called for payment by giving notice of that call to the Registered Owner. Section 9. Pledge of Taxes. For as long as the Bond is outstanding,the City irrevocably pledges to include in its budget and levy taxes annually within the constitutional and statutory tax limitations provided by law without a vote of the electors of the City on all of the taxable property within the City in an amount sufficient,together with other money legally available and to be used therefor,to pay when due the principal of and interest on the Bond, and the full faith, credit and resources of the City are pledged irrevocably for the annual levy and collection of those taxes and the prompt payment of that principal and interest. Section 10. Form and Execution of Bond. The Bond shall be typewritten in a form consistent with the provisions of this ordinance and state law and shall be signed by the Mayor - 6 - 50379227.05 and City Clerk,either or both of whose signatures may be manual or in facsimile,and the seal of the City or a facsimile reproduction thereof shall be impressed or printed thereon. To be valid or obligatory for any purpose or entitled to the benefits of this ordinance,the Bond shall bear a Certificate of Authentication in the following form,manually signed by the Bond Registrar: CERTIFICATE OF AUTHENTICAnON This Bond is the fully registered City of Marysville,Washington,Limited Tax General Obligation Bond,2003 (Taxable), described in the Bond Ordinance. By _ Bond Registrar The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bond so authenticated have been duly executed, authenticated and delivered and is entitled to the benefits of this ordinance. If any officer whose facsimile signature appears on the Bond ceases to be an officer of the City authorized to sign bonds before the Bond bearing his or her facsimile signature is authenticated or delivered by the Bond Registrar or issued by the City, the Bond nevertheless may be authenticated,issued and delivered and, when authenticated,issued and delivered,shall be as binding on the City as though that person had continued to be an officer of the City authorized to sign bonds. The Bond also may be signed on behalf of the City by any person who, on the actual date of signing of the Bond, is an officer of the City authorized to sign bonds, although he or she did not hold the required office on the date of issuance of the Bond. Section II.Refunding or Defeasance of the Bond. The City may issue refunding bonds pursuant to the laws of the State of Washington or use money available from any other lawful source to pay when due the principal of and interest on the Bond, or any portion thereof included in a refunding or defeasance plan, and to redeem and retire, refund or defease such then- - 7 - 50379227.05 outstanding Bond (hereinafter collectively called the "defeased Bond") and to pay the costs of the refunding or defeasance.If money and/or direct obligations of the United States of America maturing at a time or times and bearing interest in amounts (together with money, if necessary) sufficient to redeem and retire, refund or defease the defeased Bond in accordance with its terms are set aside in a special trust fund or escrow account irrevocably pledged to that redemption, retirement or defeasance of the defeased Bond (hereinafter called the "trust account"),then all right and interest of the owner of the defeased Bond in the covenants of this ordinance and in the funds and accounts obligated to the payment of the defeased Bond shall cease and become void. The owner of defeased Bond shall have the right to receive payment of the principal of and interest on the defeased Bond from the trust account. The defeased Bond shall be deemed no longer outstanding,and the City may apply any money in any other fund or account established for the payment or redemption of the defeased Bond to any lawful purposes as it shall determine. Section 12.Construction Fund and Deposit and Use of Bond Proceeds. There has been previously created and established in the office of the Finance Director a special fund designated as the Golf Course Operating Fund, 420 (the "Construction Fund"). For purposes of paying principal of and interest and any call premium on the Bond, there shall also be created and established a special fund designated as the Limited Tax General Obligation Bond Fund, 2003 (Taxable),of the City, and the Finance Director is authorized and directed to create and establish such fund. All taxes collected for and allocated to the payment of the principal of and interest on the Bond shall be deposited in the Bond Fund. The principal proceeds received from the sale and delivery of the Bond shall be paid into the Construction Fund and used for the purposes of paying or reimbursing costs of the Project as specified in Section 1 of this ordinance. Until needed to pay the costs of the Project and costs of issuance of the Bonds, the City may invest principal proceeds temporarily in any legal - 8 - 50379227.05 ___~_J investment,and the investment earnings may be retained in the Construction Fund and be spent for the purposes of that fund. The cost of all necessary architectural,engineering,legal,appraisal and other consulting services,inspection and testing,administrative and relocation expenses,site acquisition or improvement,demolition,on and off-site utilities,related improvements and other costs incurred in connection with the making of the improvements constituting the Project shall be deemed a part of the costs of such improvements. Section 13.Approval of Transaction.Bank of America,N.A.of Seattle,Washington, has presented an offer dated July 28, 2003 (the "Proposal Letter")to the City offering to purchase the Bond under the terms and conditions provided in the Proposal Letter, which written Proposal Letter is on file with the City and is incorporated herein by this reference.The City Council finds that accepting an offer by the Bank on substantially the same terms and conditions as set forth in the Proposal Letter is in the City's best interest and therefore the City accepts such offer. This ordinance shall be deemed a covenant to comply with all terms and conditions set forth in the Proposal Letter. The City shall pay the Bank a loan origination fee of $2,500 upon delivery of the Bond, which fee may be deducted from the proceeds of the Bond, and shall payor reimburse the Bank for its legal expenses as provided in the Proposal Letter, not to exceed $500. The Bond will be prepared at the City's expense and will be delivered to the Bank, together with the approving legal opinion of Foster Pepper &Shefelman PLLC,municipal bond counsel of Seattle,Washington,regarding the Bond. The proper City officials are authorized and directed to do everything necessary for the prompt delivery of the Bond to the Bank and for the proper application and use of the proceeds of the sale thereof. - 9 - 50)79227.05 -,,' Section 14.Effective Date of Ordinance. This ordinance shall take effect and be in force from and after its passage and five days following its publication as required by law. PASSED by the City Council and APPROVED by the Mayor of the City of Marysville, Washington,at a regular open public meeting thereof this 28 t11 day of July, 2003. CITY OF MARYSVILLE,WASHINGTON By~JuJMA DAVID A.WEISER,Mayor ATTEST: R, City Clerk APPROVED AS TO FORM: -10- 50379227.05 i ...... CERTIFICATION I,the undersigned,City Clerk of the City of Marysville, Washington (the "City"),hereby certify as follows: I. The attached copy of Ordinance No.'1-4 g4 (the "Ordinance")is a full, true and correct copy of an ordinance duly passed at a regular meeting of the City Council of the City held at the regular meeting place thereof on July 28, 2003, as that ordinance appears on the minute book of the City; and the Ordinance will be in full force and effect five days after the publication of its summary in the City's official newspaper. 2. A quorum of the members of the City Council was present throughout the meeting and a majority of those members present voted in the proper manner for the passage of the Ordinance. IN WITNESS WHEREOF, I have hereunto set my hand this 28th day of July, 2003. CITY OF MARYSVILLE,WASHINGTON 50379227.05