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HomeMy WebLinkAbout5413 CITY OF AUBURN, WASHINGTON ORDINANCE NO. 5413 AN ORDINANCE RELATING TO LOCAL IMPROVEMENT DISTRICT NO. 347; FIXING THE AMOUNT, FORM, DATE, INTEREST RATE AND MATURITY OF THE LOCAL IMPROVEMENT DISTRICT NO. 347 BOND; PROVIDING FOR THE SALE AND DELIVERY THEREOF TO U.S. BANK, NATIONAL ASSOCIATION, IN SEATTLE, WASHINGTON; AND FIXING THE INTEREST RATE ON LOCAL IMPROVEMENT DISTRICT ASSESSMENT INSTALLMENTS. THE CITY COUNCIL OF THE CITY OF AUBURN, WASHINGTON, DO ORDAIN as follows: Section 1. Authorization and Descrintion of Bond. The total amount of the assessment roll in Local Improvement District No. 347 (the "District") in the City of Auburn, · Washington, (the "City"), created under Ordinance No. 4955, passed June 2, 1997, was $587,827. The 30-day period for making cash payments of assessments without interest in the District expired on March 31, 2000, and no assessments were paid in cash, leaving a balance of assessments unpaid on the assessment roll in the amount of $587,827. A single Local Improvement District No. 347 Bond (the "Bond") shall be issued in the principal sum of $587,827. U.S. Bank, National Association of Seattle, Washington (the "Bank") has offered to purchase the Bond under the terms of its purchase offer dated June 19, 2000 (the "Offer"), and this ordinance. The Bond shall be dated its date of issuance, shall mature on May 1, 2012, and shall be numbered R-l, in the manner and with any additional designation as the Bond Registrar (the Finance Director of the City, who is hereby appointed as Bond Registrar, located in Auburn, Ordinance 5413 June 27, 2000 Page 1 50183314.03 Washington) deems necessary for the purpose of identification. Interest shall be computed on the basis of a 360-day year for the actual number of days the principal mount is outstanding, shall bear interest at the rate of 6.85% per annum, payable annually on each May 1, commencing May 1, 2001 (the "Interest Payment Date") to maturity or prepayment. Principal is payable at maturity or early prepayment. Section 2. Registration and Transfer of Bond, Bond Re~,istrar. The Bond shall be issued to the Bank 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 Bond Register shall contain the name and mailing address of the owner of the Bond and the principal amount and number 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 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 her 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 ordinance. 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 Ordinance 5413 June 27, 2000 Page 2 50183314.03 therein and to no other person or entity, and that the Bond may not be assigned except on the books of the Bond Registrar. Section 3. Payment of Bond. Both principal of and interest on the Bond shall be payable solely out of the Local Improvement Fund, District No. 347 (the "Bond Fund"), and ~'om the Local Improvement Guaranty Fund of the City, and shall be payable in lawful money of the United States of America. Interest on the Bond shall be paid by check or draft mailed, or wire transferred, to the Bank on the Interest Payment Date at the address appearing on the Bond Register. Principal of the Bond at maturity or prior repayment is payable at the office of the Bond Registrar in Auburn, Washington, upon presentation and surrender of the Bond. Section 4. Prepavment and Redemption of Bond. On each Interest Payment Date, the City shall apply all amounts remaining in the Bond Fund, after payment of accrued interest, to the prepayment at par of outstanding principal of the Bond. The City shall provide three days written notice to the Bank of the final payment of principal of and interest on the Bond. Interest on the Bond or the portion thereof so prepaid shall cease to accrue on the date of such prepayment. The Bond redeemed under this section shall be cancelled. Section 5. Failure to Redeem Bond. If the Bond is not redeemed when properly presented at its maturity or prepayment date, the City shall be obligated to pay interest on the Bond at the same rate provided in the Bond from and after its maturity or prepayment date until the Bond, 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 payment. Section 6. Pledge of Assessment Payments. Assessments collected in Local Improvement District No. 347, together with interest and penalties, if any, are pledged to the Ordinance 5413 June 27, 2000 Page 3 50183314.03 payment of the Bond which are payable solely out of the Bond Fund and the Local Improvement Guaranty Fund of the City in the manner provided by law. The Bond is not a general obligation of the City. Section 7. Covenant. The City covenants that based on current market values, money or lawful investments held from time to time in the City's Local Improvement Guaranty Fund, subject only to constitutional or statutory limitations and limitations required to maintain the tax- exempt status of bonds guaranteed by that fund, shall be at least equal to 10% of the total principal mount of all obligations guaranteed by the City's Local Improvement Guaranty Fund, plus accrued but unpaid interest thereon, and less the total amount of money and lawful investments in the respective bond funds for payment and redemption of all outstanding obligations guaranteed by the City's Local Improvement Guaranty Fund. The City shall adjust the amount on deposit in the Guaranty Fund at least annually in order to maintain compliance with this covenant. The City further covenants that it will not issue bonds for the purpose of advance refunding the Bond. Section 8. Form and Execution of Bond. The Bond shall be printed, lithographed or typed on good bond paper in a form consistent with the provisions of this ordinance and state law, shall be signed by the Mayor and the 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. 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: Ordinance 5413 June 27, 2000 Page 4 50183314.03 CERTIFICATE OF AUTHENTICATION This Bond is the fully registered City of Auburn, Washington, Local Improvement District No. 347 Bond described in the Bond Ordinance. By Finance Director of the City of Aubum, Washington, Bond Registrar 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 facsimile signature are 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 9. Preservation of Tax Exemption for Interest on the Bond. The City covenants that it will take all actions necessary to prevent interest on the Bond fi'om 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 Ordinance 5413 June 27, 2000 Page 5 50183314.03 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 l0. Small Governmental Issuer Arbitra~,e Rebate Exception and Designation of the Bond as a "Oualified Tax-Exempt Obli~,ation." The City finds and declares that (a) it is a duly organized and existing govemmental 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 Intemal 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 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 11. Use of Bond Proceeds. Principal proceeds of the Bond shall be used to finance the costs by depositing the proceeds into the City's Local Improvement Fund, District No. 347 (the "Bond Fund"), to repay its interfired loans of the City and to pay the costs of Ordinance 5413 June 27, 2000 Page 6 50183314.03 issuance of the Bond. Until needed to pay those costs, the City may invest principal proceeds temporarily in any legal investment, and the investment earnings may be retained in the Bond Fund and be spent for the purposes of that fund. Section 11. Approval of Offer. U.S. Bank, National Association, of Seattle, Washington, has presented the Offer to the City offering to purchase the Bond under the terms and conditions provided in the Offer, which written Offer is on file with the Finance Director and is incorporated herein by this reference. The City Council finds that entering into the Offer is in the City's best interest and therefore accepts the Offer contained therein and authorizes its execution by City officials. A loan fee of $500 shall be paid to the Bank at closing and may be from bond proceeds or other money of the City. The Bond will be printed at City expense and will be delivered to the purchaser in accordance with the Offer, with the approving legal opinion of Foster Pepper & Shefelman PLLC, municipal bond counsel of Seattle, Washington, regarding the Bond. Bond counsel shall not be required to review and shah express no opinion conceming the completeness or accuracy of any official statement, offering circular or other sales material, if any, issued or used in connection with the Bond, and bond connsel'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 purchase and for the proper application and use of the proceeds of the sale thereof. Section 13. Fixin~ Interest Rate on Assessments. The interest rate on the installments and delinquent payments of the special assessments in the District is revised and fixed at the rate of 7.35% per annum. Ordinance 5413 June 27, 2000 Page 7 50183314.03 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 Auburn, Washington, at a regular open public meeting thereof, this 17t" day of July, 2000. INTRODUCED aua..y ].7, 2000 PASSED: July ].7, 2000 APPROVED: July' ].7? 2000 Charles A. Booth, Mayor ATTEST: APPROVED AS TO FORM: Michael J. Reynolds, City Attomey Ordinance 5413 June 27, 2000 Page 8 50183314.03