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HomeMy WebLinkAbout4561 CITY OF BREMERTON, WASHINGTON ORDINANCE NO. /7Z5/~ / AN ORDINANCE of the City of Bremerton, Washington, relating to contracting indebtedness; providing for the issuance, specifying the installment payments, interest rate, terms and covenants and fixing the form of a $237,700 par value Limited Tax General Obligation Bond, 1996, of the City for general City purposes to provide funds with which to pay the cost of upgrading an existing City computer system and acquiring new computer systems and equipment; establishing a bond redemption fund and an acquisition fund; and approving the sale and providing for the delivery of the bonds to Bank of America NW, N.A., doing business as Seafirst Bank. WHEREAS, the City of Bremerton, Washington (the "City"), is in need of upgrading an existing City computer system and acquiring new computer systems and equipment, the estimated cost of which is $344,500, and the City does not have available sufficient funds to pay the cost; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON, DO ORDAIN as follows: Section 1. 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 1995 is $1,223,940,521, and the City has outstanding general indebtedness evidenced by limited tax general obligation bonds and notes in the principal amount of $10,083,210 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, unlimited tax general obligation bonds in the principal amount of $1,710,000 incurred within the limit of up to 2-1/2% of the value of the taxable property within 0244239.01 -1-- the City for capital purposes only, issued pursuant to a vote of the qualified voters of the City, and the amount of indebtedness for which bonds are authorized herein to be issued is $237,700. Section 2. Definitions. As used in this ordinance, the following words shall have the following meanings: "Bank" means Bank of America NW, N.A., doing business as Seafirst Bank in Seattle, Washington. "Bond" means the Limited Tax General Obligation Bond, 1996, of the City in the principal amount of $237,700, which is authorized to be issued by this ordinance. "Bond Fund" means that special fund of the City known as the Limited Tax General Obligation Bond Fund, 1996, created by this ordinance. "Bond Purchase Offer" means the Bank's purchase offer dated April 29, 1996, offering to purchase the Bond. "Bond Registrar" means the Treasurer of the City. "City" means the City of Bremerton, Washington. "Code" means the Internal Revenue Code of 1986, as amended. "Project" means the upgrading of an existing City computer system and acquiring new computer systems and equipment. Section 3. Authorization and Description of Bond. The City shall borrow money on the credit of the City and issue negotiable limited tax general obligation bonds as a single Bond evidencing that indebtedness in the amount of $237,700 for general City purposes to provide the funds to pay the cost of the Project and to pay the costs of issuance and sale of the Bond (the "costs of issuance"). The general indebtedness to be incurred shall be 0244239.01 2 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. The Bond shall be called the Limited Tax General Obligation Bond, 1996, of the City; shall be issued in registered form; shall be in the principal amount of $237,700; shall be dated as of its date of delivery to the Bank; shall mature four years from the dated date of the Bond; shall be numbered R-i; and shall bear interest at the rate of 5.20% per annum (computed on the basis of a 360-day year of twelve 30-day months). The Bond shall be payable in semiannual installments of principal and interest amortized over four years on each January 1 and July 1, commencing January 1, 1997, as set forth in Exhibit A to the Offer, to the maturity or earlier redemption of the Bond. The life of the Project to be acquired with the proceeds of the Bond exceeds the term of the Bond. Section 4. Bond Reqistrar; Reqistration and Transfer of Bond. The Treasurer shall serve as Bond Registrar for the Bond. The Bond shall be issued to the Bank only in registered form as to both principal and interest and recorded on the books or records maintained by the Bond Registrar (the "Bond Register"). The Bond Register shall contain the name and mailing address of the owner of the Bond. The Bond may not be assigned or transferred by the Bank, except that the Bank may assign or transfer the Bond to any successor to the business and assets of the Bank. When the Bond has been paid in full, both principal and interest, the Bond shall 0244239.01 -3-- be surrendered by the Bank to the Bond Registrar, who shall cancel the Bond. The Bond Registrar shall keep, or cause to be kept, at his office, sufficient books for the registration of the Bond. The Bond Registrar shall serve as the City's authenticating trustee, transfer agent, registrar and paying agent for the Bond and shall comply fully with all applicable federal and state laws and regulations respecting the carrying out of those duties. 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 resolution and City Ordinance No. 3862 establishing a system of registration for the City's bonds and obligations. No assignment or transfer of the Bond shall be effective until the name of the new owner and the new owner's mailing address, together with such other information deemed appropriate by the Bond Registrar, shall be recorded on the Bond Register. The Bond shall state on its face that the principal of and interest on the Bond shall be paid only to the owner thereof registered as such on the Bond Register as of the record date set forth therein and to no other person or entity, and that the Bond may not be assigned except on the Bond Register. Section 5. Payment of Bond. Both principal of and interest on the Bond shall be payable in lawful money of the United States of America and shall be paid by checks or drafts of the Bond Registrar mailed on the installment payment date to the Bank at the 0244239.01 -4- address appearing on the Bond Register or by electronic transfer on the payment date to an account designated by the Bank. The Bond will be surrendered upon the final payment of principal and interest, and destroyed or cancelled in accordance with law. Section 6. Redemption Provisions. The City reserves the right and option to prepay the Bond prior to maturity as a whole at any time upon 5 business day's prior written notice to the Bank at the address appearing on the Bond Register at the time the Bond Registrar prepares the notice and payment of a potential prepayment penalty as described in the Bond Purchase Offer and in the Bond. Section 7. Failure to Pay Installments. If any installment of principal and interest is not paid when due, the City shall be obligated to pay interest on that installment at the same rate provided in the Bond from and after its payment date 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 Bond has been called for redemption. Section 8. Pledqe 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. 0244239.01 --5-- Section 9. Form and Execution. The Bond shall be printed, lithographed, typed or multicopied on good bond paper in a form consistent with the provisions of this ordinance and state law, shall be signed manually or in facsimile in the corporate name of the City by the Mayor and City Clerk, and the seal of the City or a facsimile thereof shall be impressed or printed thereon. The Bond shall bear thereon a Certificate of Authentication in the following form, manually signed by the Bond Registrar, and only if so executed shall the Bond be valid or obligatory for any purpose or entitled to the benefits of this ordinance: CERTIFICATE OF AUTHENTICATION This Bond is the fully registered City of Bremerton, Washington, Limited Tax General Obligation Bond, 1996, described in the Bond Ordinance. BOND REGISTRAR By Treasurer of the City of Bremerton, Washington The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bond so authenticated has 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 manual or facsimile signature is authenticated or delivered by the Bond Registrar or issued by the City, that 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 0244239.01 --6- 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 10. Preservation of Tax Exemption for Interest on Bond. The City covenants that it will take all actions necessary to prevent interest on the Bond from being included in gross income for federal income tax purposes, and it will neither take any action nor make or permit any use of proceeds of the Bond or other funds of the City treated as proceeds of the Bond at any time during the term of the Bond which will cause interest on the Bond to be included in gross income for federal income tax purposes. The City certifies that it has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whose arbitrage certifications may not be relied upon. Section 11. Small Governmental Issuer Arbitraqe Rebate Exception and Desiqnation of the Bond as a "Qualified Tax-Exempt Obligation." The City finds and declares that (a) it is a duly organized and existing governmental unit of the State of Washington and has general taxing power; (b) the Bond is not a "private activity bond" within the meaning of Section 141 of the United States Internal Revenue Code of 1986, as amended (the "Code"); (c) at least 95% of the net proceeds of the Bond will be used for local governmental activities of the City (or of a governmental unit the jurisdiction of which is entirely within the jurisdiction 024~239. O1 7 of the City); (d) the aggregate face amount of all tax-exempt obligations (other than private activity bonds and other obligations not required to be included in such calculation) issued by the City and all entities subordinate to the City (including any entity which the City controls, which derives its authority to issue tax-exempt obligations from the City or which issues tax- exempt obligations on behalf of the City) during the calendar year in which the Bond is issued is not reasonably expected to exceed $5,000,000; and (e) the amount of tax-exempt obligations, including the Bond, designated by the City as "qualified tax-exempt obligations" for the purposes of Section 265(b) (3) of the Code during the calendar year in which the Bond is issued does not exceed $10,000,000. The City therefore certifies that the Bond is eligible for the arbitrage rebate exception under Section 148(f) (4) (D) of the Code and designates the Bond as a "qualified tax-exempt obligation" for the purposes of Section 265(b) (3) of the Code. Section 12. Bond is Negotiable. The Bond shall be a negotiable instrument to the extent provided by RCW 62A.8-102 and 62A.8-105. Section 13. Refundinq or Defeasance of the Bond. The City may issue re~undlng 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 all of such then-outstanding Bond (hereinafter called the "defeased Bond") and to pay the costs 0244239.01 --8- of the refunding or defeasance. If money and/or "government obligations" (as defined in chapter 39.53 RCW, as now or hereafter amended) 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 the 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 14. Bond Fund and Deposit of Bond Proceeds. There is created and established in the office of the City Treasurer a special fund designated as the Limited Tax General Obligation Bond Fund, 1996 (the "Bond Fund"). Accrued interest on the Bond, if any, received from the sale and delivery of the Bond shall be paid into the Bond 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 a special Project account in the City's 0244239.01 9 General Fund and used for the purposes specified in Section 2 of this ordinance. Until needed to pay the costs of the Project and costs of issuance of the Bond, the City may invest principal proceeds temporarily in any legal investment, and the investment earnings may be retained in the General Fund and be spent for the purposes of that fund. Section 15. Approval of Bond Purchase Offer. The Bank has presented its Bond Purchase Offer to the City offering to purchase the Bond under the terms and conditions provided in the Bond Purchase Offer, which written Bond Purchase Offer is on file with the Treasurer and is incorporated herein by this reference. The City Council finds that accepting the Bond Purchase Offer is in the City's best interest and therefore accepts the same. The Bond will be printed at the expense of the City and will be delivered to the Bank in accordance with the Bond Purchase Offer, with the approving legal opinion of Foster Pepper & Shefelman, municipal bond counsel of Seattle, Washington, regarding the Bond. Bond counsel shall not be required to review and shall express no opinion concerning the completeness or accuracy of any official statement, offering circular or other sales material issued or used in connection with the Bond, and bond counsel's opinion shall so state. 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. 0244239.01 -10- Section 16. Effective Date of Ordinance. This Ordinance shall take effect 10 days from its passage and publication. APPROVED by the City Counci of the City of Bremerton, Washington, this 19th day of June, 1996. PASSED by the City Council of the City of Bremerton, Washington, this 26th day of June, 1996. ~OHN ~ - ~ Council President APPROVED this ~ day of June, 1996. ATTEST: KAT~LEEN McCLUSKEY, City C~- APPROVED AS TO FORM: George M. Mack, Bond Counsel Publication Date: '~-~/- ~ Ordinance Number: ' ~ ? EFFECTIVE DATE F::~BLIoAT,0N DATE ORDiNANI3E NU1ViBER 0244239.01 -11- I, KATHLEEN L. McCLUSKEY, City Clerk of the City of Bremerton, Washington, certify that the attached copy of Ordinance No. ~-~/ is a true and correct copy of the original ordinance passed on the 26th day of June, 1996, as that ordinance appears on the Minute Book of the City. DATED this ,3~,~ day of June, 1996. Kathleen B. ~cCluske¥ City Clerk 0244239.01