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HomeMy WebLinkAbout3993 CITY OF BREMERTON, WASHINGTON ORDINANCE NO. 3995 AN ORDINANCE of the City of Bremerton, Washington, relating to the waterworks utility of the City, including the sewerage system as a part thereof; amending Ordinance No. 3989; and, because of its urgency, providing that thls ordinance shall take effect immediately. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON, AS FOLLOWS: Section 1. Section 5 of Ordinance No. 3989 is amended to read as follows: Section 5. The accrued interest received from the pur- chaser of the Bonds shall be deposited in the Principal and Interest Account in the Bond Fund. The City shall use the proceeds of the Bonds immediately upon their receipt, together with the amount of $100,186.05 from the principal and interest account of the Outstanding Bond Fund, to discharge the obliga- tions of the City under Ordinance No. 2982 authorizing the issuance of the 1971 Bonds, Ordinance No. 3092 authorizing the issuance of the 1973 Bonds, and Ordinance No. 3861, as amended, authorizing the issuance of the 1983 Bonds, by providing for the carrying out of the Refunding Plan. The City shall discharge fully such obligations by the purchase of the Acquired Obliga- tions, bearing such interest and maturing as to principal and interest in such amounts and at such times so as to provide, together with the beginning cash balance, for such payments. The Acquired Obligations are more particularly described and are set forth in Schedule A attached to the Refunding Trust Agreement, but are subject to substitution as set forth below. The Acquired Obligations and a beginning cash balance of $900.00 (which amount may be increased or decreased as required when the exact purchase price of the Acquired Obligations is ascertained) shall be deposited irrevocably with the Refunding Trustee. The City reserves the right to substitute other Government Obll§ations for any of the Acquired Obligations and to use any savings created thereby for any lawful System purposes if, in the opinion of Roberts & Shefelman, the City's bond counsel, the Bonds will remain exempt from federal income taxation under Section 103(c) of the United States Internal Revenue Code of 1954, as amended, and applicable regulations thereunder, and if such substitution shall not impair the timely payment of the principal of or interest on the Outstanding Bonds or the call, payment and redemption of the 1983 Bonds to be called. Section 2. Section 7 of Ordinance No. 3989 is amended to read as follows: Section 7. Immediately upon the delivery of the Bonds, the City Treasurer is directed to transfer the amount on deposit in the reserve account of the Outstanding Bond Fund and $15,020 on deposit in the principal and interest account of the Outstanding Bond Fund to the Reserve Account for the Bonds and use any additional funds on deposit in the principal and interest account of the Outstanding Bond Fund for the Refunding Plan as set forth in Section 5 of this ordinance. Any remaining funds on deposit in the principal and interest account of the Out- standing Bond Fund shall be transferred to the Principal and Interest Account. Section 3. Section 12 of Ordinance No. 3989 is amended to read as follows: Section 12. The City further covenants with the owner of each of the Bonds for as long as any of the same is outstanding that it will not create any special account or fund or accounts or funds for the payment of the principal of and interest on any othe~ revenue obligations which will have any priority over or which will rank on a parity with the payments required by this -- 2 -- ordinance to be made out of the Net Revenue of the System, nor will it issue Future Parity Bonds, except that it reserves the right for First, the purpose of acquirln§, constructing and installing additions, betterments and improve- ments to and extensions of, acquiring necessary equipment for, or making necessary replacements of or repairs or capital improvements to the System pursuant to a plan or plans of additions and better- ments thereto hereafter adopted, or Second, the purpose of refunding by exchange or purchasing and retiring or advance refunding by call and payment at or prior to their maturity any part or all of the outstanding Bonds or Future Parity Bonds, or Third, other purposes then permitted by law, to issue additional and/or refunding revenue bonds therefor, and to make payments into the Bond Fund from the Net Revenue of the System sufficient to pay the principal of and interest on such Future Parity Bonds and to maintain a reserve therefor as hereinafter required, which payments may rank equally with the payments out of the Net Revenue of the System required to be made into the Bond Fund by this ordinance, if the following conditions and requirements are met and complied with at the time of the issuance of such Future Parity Bonds: (a) At the time of issuance of such Future Parity Bonds, there shall not be a deficiency in either the Principal and Interest Account or the Reserve Account in the Bond Fund; (b) The ordinance authorizing the issuance of such Future Parity Bonds shall provide for the creation of a sinking fund account in the Bond Fund for any Term Bonds to be issued and for regular payments to be made into such account for the payment of the principal of such Term Bonds on or before their maturity, or, as an alternative, the mandatory redemption of such Term Bonds prior to their maturity date from money in the Principal and Interest Account. (c) The ordinance authorizing any Future Parity Bonds shall provide for the payment of the principal of and interest thereon out of the Bond Fund and shall further provide for the payment from the Net Revenue of the System in substantially equal monthly payments an amount which within a period of five years from the date of issuance of such Future Parity Bonds will fund fully the Reserve Requirement of such - 3 - Future Parity Bonds subject to the City's ri§bt to fund all or a portion of the Reserve Requirement with a Reserve Fund Instrument or in whole or in part out of the proceeds of such Future Parity Bonds; except that in the event such Future Parity Bonds are issued for the purpose of refunding outstandin§ Bonds and/or Future Parity Bonds, the amount of such reserve allocated to such bonds being so refunded shall be retained or 'used as a reserve for such refundln§ Future Parity Bonds or used to retire outstanding Bonds or outstanding Future Parity Bonds pursuant to the refundin§ plan, which reserve amount shall be replaced in the same manner and within the same time as required for additional Future Parity Bonds, or such reserve may remain in the Reserve Account to be used as the reserve for remaining bonds payable from the Bond Fund; and (d) At the time of the issuance of such Future Parity Bonds, the City shall have on file a certifl- cate f~om an independent, licensed professional engineer experienced in the design, construction and operation of municipal utilities, or a certified public accountant, showing that in his or her pro- fessional opinion the estimated Gross Revenue of the System in any future year, after deductln§ Operating and Maintenance Expenses, will be at least equal to the Coverage Requirement. A copy of such certificate shall be provided, upon filing, with the Bond Insurer. The Coverage Requirement may be waived or modified solely with the written consent of the Bond Insurer. However, if Future Parity Bonds proposed to be so issued are for the sole purpose of refunding outstanding bonds payable from the Bond Fund, such certification of coverage shall not be required if the Annual Debt Service in each year for the refund- lng bonds is not increased over the amount required for the bonds to be refunded thereby and the maturi- ties of those refunding bonds are not extended beyond the maturities of the bonds to be refunded thereby. The engineer's certificate, in estimating the Gross Revenue of the System available for debt service, shall use the historical Gross Revenue of the System for any twelve consecutive months out of the twenty-four months immediately preceding the month of delivery of the Future Parity Bonds. Such Gross Revenue may be adjusted to reflect any changes in rates in effect and being charged or expressly committed by ordinance of the City Council to be made in the future; may include income derived from customers of the System that have become customers during the twelve consecutive month period or there- after adjusted to reflect one year's net revenue from such customers; may include revenues from any cus- tomers to be connected to the System who have paid the required connection charges; may include the revenue to be derived from any person, firm, corpo- ration or municipal corporation under any executed contract for water and/or sewer service which revenue was not included in the historical Gross Revenue of the System; and may include the engineer's estimate of the Gross Revenue to be derived by the City from - 4 - customers with improved property auailable to connect to any additions to and improvements and extensions of the System to be paid for out of the proceeds of the sale of the additional Future Parity Bonds or other additions to and improvements and extensions of the System then under construction and not fully connected to the facilities of the System when such additions, improvements and extensions are completed. Actual or reasonably anticipated changes in the Operating and Maintenance Expenses subsequent to such twelve-month period shall be added or deducted, as is applicable. Nothing contained in the provisions for Future Parity Bonds shall prevent the City from issuing revenue bonds having a subordinate lien on the Gross Revenue of the System. Section 4. For the reason that it is necessary that the City obtain the proceeds of the sale of the bonds authorized in Ordinance No. 3989 as soon as possible in order to carry out the refunding plan provided in that ordinance, an emergency is declared to exist, and it is found necessary for the public health, welfare and safety that this ordinance become effective immediately upon its passage, approval and publication as required by law. PASSED UNANIMOUSLY by the City Council of the City of Bremerton, Washington, at a regular open public meeting thereof and APPROVED by the Mayor on the 13th day of November, 1985. MAYOR ATTEST: C I TY-. CLERK APPROVED AS TO FORM: CITY AT,NEY 0995b - 5 -