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HomeMy WebLinkAbout4322 CITY OF BREMERTON, WASHINGTON No. AN ORDINANCE of the City of Bremerton, Washington, relating to contracting indebtedness; authorizing the issuance of limited tax general obligation bonds of the City for general City purposes to provide funds with which to pay a part of the cost of acquiring land and constructing and equipping a public works complex to house City departments, including street vehicle, electronics and facilities maintenance, and for other capital purposes; authorizing the issuance of bond anticipation notes pending the issuance of those bonds; establishing a note redemption fund and an acquisition and construction fund; and approving the sale and providing for the delivery of the notes to Seattle-First National Bank of Seattle, Washington. WHEREAS, the City of Bremerton, Washington (the "City"), is in need of acquiring land and constructing and equipping a public works complex to house City departments, including street vehicle, electronics and facilities maintenance, and for other capital purposes, the estimated cost of which is $2,150,000, and the City does not have available sufficient funds to pay that cost; and WHEREAS, the City Council deems it to be in the best interests of the City to borrow money by the issuance of limited tax general obligation bonds and, pending the issuance of those bonds, issue short-term obligations in accordance with the provisions of Chapter 39.40 RCW for the purpose of providing part of the funds with which to pay the costs of acquiring and constructing the facilities herein described; NOW, THEREFORE, BE IT ORDAINED BY THE MAYOR AND THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON, as follows: Section 1. Debt Capacity. The assessed valuation of the taxable property of the City as ascertained by the last preceding assessment for City purposes for the calendar year 1990 is $855,620,809.00, and the City has outstanding general indebtedness evidenced by limited tax general obligation bonds, notes,lease-purchase agreements and conditional sales contracts in the principal amount of $2,182,854.00 incurred within the limit of up to 3/4 of 1% 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 or notes in the principal amount of $2,415,000.00 incurred within the limit of up to 2-1/2% of the value of the taxable property within the City for capital purposes only, unlimited tax general obligation bonds in the principal amount of $0.00 incurred within the additional limit of up to 2-1/2% of the value of the taxable property within the City for utility purposes and unlimited tax general obligation bonds in the principal amount of $0.00 incurred within the additional limit of up to 2-1/2% of the value of the taxable property within the City for parks and open space purposes 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 $1,750,000.00. - 2 - Section 2. Authorization of Bonds. The City shall borrow money on the credit of the City and issue negotiable limited tax general obligation bonds evidencing that indebtedness in the amount of $1,750,000 for general City purposes to provide the funds to pay a part of the cost of acquiring land and constructing and equipping a public works complex to house City departments, including street vehicle, electronics and facilities maintenance, and for other capital purposes (the "Project") and to pay the costs of issuance and sale ("costs of issuance") of the bonds. The general indebtedness to be incurred shall be within the limit of up to 3/4 of 1% of the value of the taxable property within the City permitted for general municipal purposes without a vote of the qualified voters therein. Section 3. Description of Notes. There is created in the office of the City Treasurer a special fund designated as the Limited Tax General Obligation Bond Anticipation Note Fund, 1991 (the "Note Fund"). For the purpose of providing a part of the funds with which to pay the costs of the Project pending the receipt of the proceeds of the issuance and sale of the limited tax general obligation bonds authorized herein, the City shall issue and sell its Limited Tax General Obligation Bond Anticipation Notes, 1991 (the "Notes") in the principal amount of $1,300,000. The - 3 - Notes shall be in fully registered form; shall be dated May 15, 1991; shall mature on November 16, 1992; shall be in the denomination of $100,000; shall be numbered separately in the manner and with any additional designation as the Bond Registrar (collectively, the fiscal agencies of the State of Washington located in Seattle, Washington, and New York, New York) deems necessary for purposes of identification; and shall bear interest at the rate of __% per annum (computed on the basis of a 360-day year of twelve 30-day months), payable at maturity. The life of the capital facilities to be acquired and constructed with the proceeds of the Notes exceeds twenty years. The City Council finds that the fixing of the above interest rate is in the best interest of the City. Section 4. Registration and Transfer of Notes. The Notes shall be issued only in registered form as to both principal and interest and be recorded on books or records maintained by the Note Registrar (the "Note Register"). The Note Register shall contain the name and mailing address of the owner of each Note and the principal amount and number of each of the Notes held by each owner. Notes surrendered to the Note Registrar may be exchanged for Notes in the authorized denomination of an equal aggregate principal amount. Notes may be transferred only if endorsed in the manner provided thereon and surrendered to the Note Registrar. Any exchange or transfer shall be without cost to - 4 - the owner or transferee. The Note Registrar shall not be obligated to exchange or transfer any Note during the fifteen days preceding the maturity date of the Notes. Section 5. Payment of Notes. Both principal of and interest on the Notes shall be payable in lawful money of the United States of America. Principal and interest of the Notes shall be payable upon presentation and surrender of the Notes at maturity by the registered owners at either of the principal offices of the Bond Registrar at the option of the owners. Section 6. Optional Redemption and Open Market Purchase of Notes. The Notes shall be issued without the right or option of the City to redeem the Notes prior to their maturity date. The City reserves the right and option to purchase any or all of the Notes in the open market at any time at a price not in excess of par plus accrued interest to the date of purchase. All Notes purchased under this section shall be cancelled. Section 7. Pledqe of Taxes. The City irrevocably pledges to redeem the Notes on November 16, 1991, from the proceeds of a sufficient amount of limited tax general obligation bonds authorized by this ordinance, from the proceeds of additional short-term obligations or from other money of the City legally available for such purpose, and 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 - 5 - amount sufficient, together with those bond or other short-term obligation proceeds and other money legally available and to be used therefor, to pay when due the principal of and interest on the Notes and those bonds, 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 8. Form and Execution of Notes. The Notes shall be typed, printed or lithographed on good bond paper in a form consistent with the provisions of this ordinance and state law, shall be signed by the City Treasurer, 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. Only Notes bearing a Certificate of Authentication in the following form, manually signed by the Note Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of this ordinance: CERTIFICATE OF AUTHENTICATION This note is one of the fully registered City of Bremerton, Washington, Limited Tax General Obligation Bond Anticipation Notes, 1991, described in the Bond Ordinance. WASHINGTON STATE FISCAL AGENCY Note Registrar By Authorized Officer - 6 - The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Notes so authenticated have been duly executed, authenticated and delivered and are entitled to the benefits of this ordinance. If any officer whose facsimile signature appears on the Notes ceases to be an officer of the City authorized to sign notes before the Notes bearing his or her facsimile signature are authenticated or delivered by the Note Registrar or issued by the City, those Notes 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 notes. Any Note also may be signed on behalf of the City by any person who, on the actual date of signing of the Note, is an officer of the City authorized to sign notes, although he or she did not hold the required office on the date of issuance of the Notes. Section 9. Note Reqistrar. The Note Registrar shall keep, or cause to be kept, at its principal corporate trust office, sufficient books for the registration and transfer of the Notes which shall at all times be open to inspection by the City. The Note Registrar is authorized, on behalf of the City, to authenticate and deliver Notes transferred or exchanged in accordance with the provisions of the Notes and this ordinance, to serve as the City's paying agent for the Notes and to carry - 7 - out all of the Note Registrar's powers and duties under this ordinance and City Ordinance No. 3862 establishing a system of registration for the City's bonds and obligations. The Note Registrar shall be responsible for its representations contained in the Note Registrar's Certificate of Authentication on the Notes. The Note Registrar may become the owner of Notes with the same rights it would have if it were not the Note Registrar and, to the extent permitted by law, may act as depository for and permit any of its officers or directors to act as members of, or in any other capacity with respect to, any committee formed to protect the rights of Note owners. Section 10. Preservation of Tax Exemption for Interest on Notes. The City covenants that it will take all actions necessary to prevent interest on the Notes 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 Notes or other funds of the City treated as proceeds of the Notes at any time during the term of the Notes which will cause interest on the Notes to be included in gross income for federal income tax purposes. The City also covenants that, if all gross proceeds of the Notes have not been spent within certain periods prescribed by the United States Internal Revenue Code of 1986, as amended (the "Code"), it will calculate, or cause to be calculated, and rebate to the United States all earnings from the investment of gross proceeds of the Notes that - 8 - are in excess of the amount that would have been earned had the yield on those investments been equal to the yield on the Notes, plus all income derived from those excess earnings, to the extent and in the manner required by Section 148 of the Code, and applicable regulations. If the City fails to meet rebate requirements applicable to the Notes under Section 148 of the Code, the City covenants that, to the extent permitted by that Section, it will pay the penalty provided in Subsection 148(f)(7)(C) if required to prevent interest on the Notes from being 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 note issuer whose arbitrage certifications may not be relied upon. Section 11. Desiqnation of Notes as "Qualified Tax-Exempt Obliqations." The City has determined and certifies that (a) the Notes are not "private activity bonds" within the meaning of Section 141 of the United States Internal Revenue Code of 1986, as amended (the "Code"); (b) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds) which the City and any entity 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) will issue during the calendar year in which the Notes are issued will not exceed - 9 - $10,000,000; and (c) the amount of tax-exempt obligations, including the Notes, 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 Bonds are issued does not exceed $10,000,000. The City designates the Notes as "qualified tax-exempt obligations" for the purposes of Section 265(b)(3) of the Code. Section 12. Small Governmental Issuer Arbitraqe Rebate Exemption and Designation of Notes as "Qualified Tax-Exempt Obliqations." 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) no Note which is part of this issue of Notes is 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 Notes will be used for local governmental activities of the City (or of a governmental unit the jurisdiction of which is entirely within the jurisdiction of the City); (d) the aggregate face amount of all tax-exempt obligations (other than private activity bonds and obligations excluded from such calculation under the Code) 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 - 10 - calendar year in which the Notes are issued is not reasonably expected to exceed $5,000,000; and (e) the amount of tax-exempt obligations, including the Notes, 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 Notes are issued does not exceed $10,000,000. The City therefore certifies that it is an issuer which qualifies for the small governmental issuer arbitrage rebate exemption under Section 148(f)(4)(C) of the Code and designates the Notes as "qualified tax-exempt obligations" for the purposes of Section 265(b)(3) of the Code. Section 13. Notes Negotiable. The Notes shall be negotiable instruments to the extent provided by RCW 62A.8-102 and 62A.8-105. Section 14. Disposition of Note Proceeds. Accrued interest on the Notes, if any, received from the sale and delivery of the Notes shall be paid into the Note Fund. There is created and established in the office of the City Treasurer a special fund designated as the Public Works Complex Construction Fund, 1991 (the "Acquisition and Construction Fund). The principal proceeds received £rom the sale and delivery of the Notes shall be paid into the Acquisition and Construction 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 Notes, the City may invest principal - 11 - proceeds temporarily in any legal investment, and the investment earnings may be retained in the Acquisition and Construction Fund and be spent for the purposes of that fund except that earnings subject to a federal tax or rebate requirement may be withdrawn from the Acquisition and Construction Fund and used for those tax or rebate purposes. All taxes collected for and allocated to the payment of the principal of and interest on the Notes shall be deposited in the Note Fund. Section 15. Approval of Note Purchase Contract. Seattle-First National Bank of Seattle, Washington, has presented a purchase contract dated May 1, 1991 (the "Purchase Contract"), to the City offering to purchase the Notes under the terms and conditions provided in the Purchase Contract, which written Purchase Contract is on file with the City Clerk and is incorporated herein by this reference. The City Council finds that entering into the Purchase Contract is in the City's best interest and therefore accepts the offer contained therein and authorizes its execution by the appropriate City officials. The Notes will be printed at City expense and will be delivered to the purchaser in accordance with the Purchase Contract, with the approving legal opinion of Foster Pepper & Shefelman, municipal bond counsel of Seattle, Washington, regarding the Notes. Bond counsel shall not be required to review and shall express no opinion concerning the completeness - 12 - or accuracy of any official statement, offering circular or other sales material issued or used in connection with the Notes, 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 Notes to the purchaser and for the proper application and use of the proceeds of the sale thereof. Section 16. Temporary Note. Pending the printing, execution and delivery to the purchaser of definitive Notes, the City may cause to be executed and delivered to the purchaser a single temporary Note in the total principal amount of the Notes. The temporary Note shall bear the same date of issuance, interest rate, maturity date and terms and covenants as the definitive Notes, shall be issued as a fully registered Note in the name of the purchaser, and otherwise shall be in a form acceptable to the purchaser. The temporary Note shall be exchanged for definitive Notes as soon as they are printed, executed and available for delivery. Section 17. Effective Date. The City is in urgent need of constructing and acquiring the improvements comprising the Project and has been advised that a favorable market exists at this time for the sale of the Notes resulting in lower interest rates on the Notes and a savings to the City and its taxpayers. Therefore, the City council finds that sufficient urgency exists - 13 - to require that this ordinance take effect immediately upon its passage and publication. PASSED by the City Council of the City of Bremerton, Washington, at a regular open public meeting thereof, this 1st day of May, 1991. L~~HO/0N~P~r es ident Bremerton City Council LOUIS MENTOR, Mayor ATTEST: tr~THLEE~ L. ~cC~USKEY, City Clerk GMM-327* - 14 -