HomeMy WebLinkAbout1798 Issuance and Sale of Water and Sewer Revenue BondsORDINANCE NO..~Uqq~
AN ORDINANCE of the City of Port Townsend, Washington,
providing for the issuance and sale of water and
sewer revenue bonds of the city in the principal
amount of $.395,000, to pay part of the cost of
acquiring, constructing and installing certain
additions and improvements to and extensions of
the existing water and sewer system of the city
as authorized by Ordinance No. ~7; providing
and adopting certain covenants and protective
features safeguarding the payment of the principal
thereof and interest thereon; creating a bond
redemption fund and confirming the sale of such
bonds.
WHEREAS, Ordinance No. !~ of the City of Port Townsend,
Washington (hereinafter called the "City"), passed ~m~j~f ~7 ,
1978, authorized the acquisition, construction and installation
of certain additions and improvements to and extensions of the
existing water and sewer system of the City, and further provided
that a portion of the cost thereof would be provided by the
issuance and sale of water and sewer revenue bonds of the City in
the principal amount of not to exceed $1,245,000; and
WHEREAS, it is deemed necessary and advisable that the City
proceed with the acquisition, construction and installation of
said additions, improvements and extensions, and to pay part of
the cost thereof that it now issue and sell its water and sewer
revenue bonds in the total principal amount of $395,000; and
WHEREAS, the City has heretofore entered into an agreement
with the United States Department of Commerce acting through its
Economic Development Administration whereby the United States
Department of Commerce has agreed to purchase such water and
sewer revenue bonds to be issued;
NOW, THEREFORE, BE IT ORDAINED by the Council of the City of
Port Townsend, Washington, as follows:
Section 1. Definitions.
As used in this ordinance the following words shall have the
following meanings:
a. The wOrd "Assessments" means assessments (including
interest and penalties~ levied in any utility local improvement
district of the City which are payable into a bond fund securing
the payment of any water and sewer revenue bonds of the City.
b. The word "Bonds" means the $395,000 principal amount of
water and sewer revenue bonds of the City issued pursuant to this
Ordinance.
c. The words "Bond Fund" mean the 1978 Water Revenue Bond
Fund created by Section 12 of this Ordinance.
d. The word "City" means the City of Port Townsend, a
municipal corporation duly organized and existing under the laws
of the State of Washington.
e. The words "Construction Fund" mean the special fund of
the City known as the "1978 Water Construction Fund" created by
Ordinance No. ~l~ of the City and described in Section 12 of
this Ordinance.
f. The words "CostS of Maintenance and Operation" mean all
necessary operating expenses, current maintenance expenses,
expenses of reasonable upkeep and repairs, and insurance and
administrative expense, but excludes depreciation, payments for
debt service or into reserve accounts, costs of capital additions
to or replacements of the System, municipal taxes, or payments to
the City in lieu of taxes.
g. The word "Government" means the Economic Development
Administration of the United States Department of Commerce.
h. The words "Gross Revenue" mean all earnings, revenue
and moneys, except assessments, received by the City from or on
account of the operation of the System, including the income from
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investments of money in the Revenue Fund and any bond fund or
from any other investment thereof except the income from invest-
ments irrevocably pledged to the payment of revenue bonds pursuant
to a plan of retirement or refunding. The words ',Gross Revenue"
shall also include federal or state reimbursements of operating
expenses to the extent such expenses are included as "CostS of
Maintenance and Operation."
i. The words "Net Revenue" mean the Gross Revenue less the
Costs of Maintenance and Operation.
j. The words "Outstanding Bonds" mean the outstanding
water and sewer revenue bonds of the City issued under date of
December 1, 1959, pursuant to Ordinance No. 1379 of the City and
issued under date of January 1, 1967, pursuant to Ordinance No.
1506 of the City, and any water and sewer bonds of the City
hereafter issued.
k. The words "Revenue Fund" mean the special fund of the
City designated the "Olympic Gravity Water Fund".
1. The word "System" means the existing water and sewer
system of the City, as such system may be added to, improved and
extended for as long as any of the Bonds are outstanding. It is
hereby provided, however, that the System shall not include that
part of the water supply and distribution system of the City
leased to Crown-Zellerbach Corporation under date of March 15,
1956.
Section 2. Authorization of Bonds.
For the purpose of providing part of the money required to
acquire, construct and install those certain additions and improve-
ments to and extensions of the System as provided in Ordinance
No. ~, the City hereby authorizes the issuance of the Bonds in
the total principal amount of $395,000.
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Section 3. Description of Bonds.
The Bonds shall be designated the "City of Port Townsend
Water and Sewer Revenue Bonds, 1978," shall be dated as of the
date of delivery thereof to the purchaser, shall be in coupon
form in the denomination of $5,000 each, shall bear interest at
the rate of 5% per annum payable on the first anniversary of the
da. te of delivery, and annually thereafter on each succeeding
anniversary of the date of delivery, and shall be numbered and
mature in the order of their number on said anniversary date of
each year as follOws:
Bond Nos. Years Amounts Bond Nos. Years Amounts
1 1979 $ 5,000 23-24 1999 $ 10,000
2 1980 5,000 25-26 2000 10,000
3 1981 5,000 27-28 2001 10,000
4 1982 5,000 29-30 2002 10,000
5 1983 5,000 31-32 2003 10,000
6 1984 5,000 33-34 2004 10,000
7 1985 5,000 35-36 2005 10,000
8 1986 5,000 37-38 2006 10,000
9 1987 5,000 39-41 2007 15,000
10 1988 5,000 42-44 2008 15,000
11 1989 5,000 45-47 2009 15,000
12 1990 5,000 48-50 2010 15,000
13 1991 5,000 51-53 2011 15,000
14 1992 5,000 54-56 2012 15,000
15 1993 5,000 57-59 2013 15,000
16 1994 5,000 60-63 2014 20,000
17 1995 5,000 64-67 2015 20,000
18 1996 5,000 68-71 2016 20,000
19-20 1997 10,000 72-75 2017 20,000
21-22 1998 10,000 76-79 2018 20,000
It is hereby found and declared that the final maturity of
the Bonds does not extend beyond the reasonable life expectancy
of the System.
Both principal of and interest on the Bonds shall be payable
in lawful money of the United States of America by the City
Treasurer at his office or at the option of the holder at either
of the fiscal agencies of the State of Washington in the cities
of Seattle, Washington, and New York, New York, or, in the case
of a fully registered Bond, to the owner or owners thereof at
their address or addresses appearing on the registration books of
the City. The Bonds shall be obligations only of the Bond Fund
and shall be payable and secured as provided herein. The Bonds
are not general obligations of the City.
Section 4. Execution of Bonds.
The Bonds shall be signed on behalf of the City with the
facsimile or manual signature of the Mayor and shall be attested
by the City Clerk. Each of the Bonds shall have the seal of the
City impressed thereon. Interest coupons shall be executed with
the facsimile signatures of said officials.
Section 5. Redemption Privileges.
The City hereby reserves the right, so long as the Government
is the owner of any or all of the outstanding Bonds, to redeem
such outstanding Bonds in whole, or in part in inverse numerical
order, at any time, at par plus accrued interest to the date of
redemption.
If any or all of the outstanding Bonds are hereafter owned
by investors other than the Government, the City hereby reserves
the right to redeem such outstanding Bonds in whole, or in part
in inverse numerical order, on any interest payment date on or
after ten years from the date of issue.
Interest on any Bonds so called for redemption shall cease
on such redemption date unless the same shall not be redeemed
upon presentation made pursuant to such call.
The City may purchase outstanding Bonds in the open market
for retirement only.
Section 6. Redemption Notice.
Written notice of any such intended redemption shall be
given by registered mail sent to the Government at least ten (10)
days prior to the redemption date. In the event that any outstand-
ing Bonds are not held by the Government, such notice shall be
published once in the official newspaper of the City not more
than forty (40) nor less than thirty (30) days prior to said
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redemption date. In addition to such publication and mailing,
notice shall also be mailed to Standard & Poor's Corporation and
to Moody's Investors Service, Inc. or to their successors, if
any. The mailing of such notice shall not, however, be a condi-
tion precedent to Such redemption.
Section 7. Form of Bonds.
The Bonds shall be in substantially the following form:
UNITED STATES OF AMERICA
NO. $5,000
STATE OF WASHINGTON
CITY OF PORT TOWNSEND
WATER AND SEWER REVENUE BOND, 1978
The City of Port Townsend, a municipal corporation
organized and existing under and by virtue of the laws of
the State of Washington (herein called the "City"), hereby
acknowledges itself indebted and for value received promises
to pay to bearer, solely from the sources herein referred
to, the principal sum of
FIVE THOUSAND DOLLARS
on the day of , 19 , unless redeemed
prior thereto as herein provided, with interest thereon from
the date hereof at the rate of 5.00% per annum until such
principal sum is paid or payment has been duly provided for,
payable , 1979, and annually thereafter
on the day of of each year. Payment
of the interest due on or before the maturity of this bond
shall be made only upon presentation and surrender of the
coupons representing such interest as the same respectively
become due.
Both principal of and interst on this bond are payable
in lawful money of the United States of America, at the
office of the Treasurer of the City, in Port Townsend,
Washington, or, at the option of the holder, at either of
the fiscal agencies of the State of Washington in the cities
of Seattle, Washington, and New York, New York.
So long as the Economic Development Administration is
the owner of any or all of the outstanding Bonds, the City
has reserved the right to redeem the outstanding Bonds in
whole, or in part in inverse numerical order, at any time,
at par plus accrued interest to the date of redemption. In
the event that any outstanding Bonds are not held by the
Economic Development Administration, the City has reserved
the right to redeem such outstanding Bonds in whole, or in
part in inverse numerical order, on any interest payment
date on or after ten years from the date of issue.
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Interest on any revenue Bonds SO called for redemption
shall cease on such redemption date unless the same shall
not be redeemed upon presentation made pursuant to such
call.
Written notice of any such redemption shall be given by
registered mail sent to the Economic Development Adminis-
tration at least ten days prior to the redemption date. In
the event any outstanding Bonds are not held by the Economic
Development Administration, notice of any redemption of such
outstanding Bonds shall be given by one publication thereof
in the official City newspaper not more than forty nor less
than thirty days prior to said redemption date, and by
mailing a like notice at the same time to Standard & Poor's
Corporation and to Moody's Investors Service, Inc., or to
their successors, if any.
This bond is one of an issue of seventy-nine bonds of
the City of like amount, date and tenor except as to number
and date of maturity in the aggregate principal amount of
$395,000. This issue of bonds is authorized by Ordinance
No. ~q~of the City (herein called the "Bond Ordinance")
for the purpose of providing money to pay part of the cost
of certain improvements to the water and sewer system of the
City, all in conformity with the laws of the State of
Washington.
This bond and the bonds of this issue are payable
solely from the special fund of the City known as the "1978
Water Revenue Bond Fund" (herein called the "Bond Fund")
created in the office of the Treasurer of the City. The
City has irrevocably obligated and bound itself to pay into
the Bond Fund out of the Net Revenue of the System (as
defined in the Bond Ordinance) or from such other moneys as
may be provided therefor, certain amounts necessary to pay
and secure the payment of the princiPal of and interest on
such bonds.
The bonds of this issue are not general obligations of
the City.
The City hereby covenants and agrees with the owner and
holder of this bond that it will keep and perform all the
covenants of this bond and of the Bond Ordinance to be by it
kept and performed.
The City does hereby pledge and bind itself to set
aside from the Revenue Fund out of the Net Revenue of the
System (said terms being defined in the Bond Ordinance) into
said Bond Fund the various amounts required by the Bond
Ordinance to be paid into and maintained in said Fund, all
within the times provided by said Ordinance.
To the extent more particularly provided by the Bond
Ordinance the amounts so pledged to be paid out of the
Revenue of the System into said Bond Fund shall be a lien
and charge upon the Net Revenue of the System junior in rank
to the lien and charges of the revenue bonds of the City
issued under date of December 1, 1959, pursuant to Ordinance
No. 1379 of the City and issued under date of January 1,
1967, pursuant to Ordinance No. 1506 of the City, and any
water and sewer bonds hereafter issued by the City and superior
to all other charges of any kind or nature whatsoever.
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The City has further bound itself to maintain the
System in good repair, working order and condition, to
operate the same in an efficient manner and at a reasonable
cost, and to fix, maintain and collect rates and charges for
as long as any of the bonds of this issue are outstanding
that will make available, for the payment of the principal
thereof and interest thereon as the same shall become due,
Net Revenue and Assessment ds defined in the Bond Ordinance),
in an amount which will be equal to at, least 1.10 times the
maximum amount required to be paid out of the Bond Fund in
any year hereafter to pay the principal of and interest on
all of such bonds after payment of the principal of and
interest on all December 1, 1959, and January 1, 1967,
bonds, and any future water and sewer bonds issued by the
City, then outstanding.
The pledge of Net Revenue of the System and other
obligations of the City under the Bond Ordinance may be
discharged at or prior to the maturity or redemption of the
bonds of this issue upon the making of provisions for the
payment thereof on the terms and conditions set forth in the
Bond Ordinance.
Reference to the Bond Ordinance and any and all modi-
fications and amendments theeof is made for a description of
the nature and extent of the security for the bonds of this
issue, the funds or revenues pledged, and the terms and
conditions upon which such bonds are issued.
It is hereby certified and declared that this bond and
the bonds of this issue are issued pursuant to and in strict
compliance with the Constitution and laws of the State of
Washington and ordinances of the City, and that all acts,
conditions and things required to be done precedent to and
in the issuance of this bond have happened, been done and
performed.
IN WITNESS WHEREOF, the City has caused this bond to be
executed in its name with the facsimile (manual) signature
of the Mayor, to be attested by the manual signature of the
City Clerk, the corporate seal of the City to be impressed
hereon, and the interest coupons attached hereto to be
signed with the facsimile signatures of said officials, this
day of , 1978.
CITY OF PORT TOWNSEND, WASHINGTON
By
ATTEST:
The interest coupons attached to the Bonds shall be in
substantially the following form:
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NO. $
On the first day of , 19__, unless the
bond to which this coupon is appurtenant shall have been
duly called for prior redemption and the redemption price
shall have been paid or duly provided for, the City of Port
Townsend (the "City") will pay to bearer at the office of
the City Treasurer, in Port Townsend, Washington, or, at the
option of the holder, at either of the fiscal agencies of
the State of Washington, in the cities of Seattle, Washington,
and New York, New York, the amount shown hereon in lawful
money of the United States of America, solely out of the
sources referred to in said bond and Ordinance No. )Uq~ of
the City, being the special fund of the City entitled "1978
Water Revenue Bond Fund," said amount being the annual
interest due that day on its Water Revenue Bond, 1978 dated
, 1978, and numbered .
CITY OF PORT TOWNSEND, WASHINGTON
Mayor
ATTEST:
~ ' - -~City'Clerk
Section 8. Single Fully Registered Bonds.
The purchaser of
the Bonds may elect to accept a nonnegotiable bond registered as
to both principal and interest with a face value in the amount of
the Bonds, in lieu of individual bonds. Any such fully registered
bond shall be executed in the manner provided for the Bonds and
shall be of type composition and on paper of sufficient weight
and strength to prevent deterioration throughout the life of the
loan represented by such fully registered bond.
Such fully registered bond shall be dated as of the date of
delivery thereof to the purchaser, .shall bear interest at the
rate specified for .the Bonds, shall mature in installments in the
years and amounts set forth in Section 3 of this ordinance, and
shall be in substantially the the following form, with such
variations, omissions and insertions as may be necessary under
the circumstances:
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UNITED STATES OF AMERICA
NO. R-1 $395,000
STATE OF WASHINGTON
CITY OF PORT TOWNSEND
WATER AND SEWER REVENUE BOND, 1978
The City of Port Townsend, Washington (hereinafter
called the "City"), acknowledges itself indebted and for
value received promises to pay to the Economic Development
Administration, United States Department of Commerce, or its
successor (herein sometimes called the "Payee"), or its
registered assigns (herein sometimes called the "Alternate
Payee"), the principal sum of
THREE HUNDRED NINETY-FIVE THOUSAND DOLLARS
in the following installments on
of the following years:
of each
Years Amounts Years Amounts
1979 $ 5,000 1999 $ 10,000
1980 5,000 2000 10,000
1981 5,000 2001 10,000
1982 5,000 2002 10,000
1983 5,000 2003 10,000
1984 5,000 2004 10,000
1985 5,000 2005 10,000
1986 5,000 2006 10,000
1987 5,000 2007 15,000
1988 5,000 2008 15,000
1989 5,000 2009 15,000
1990 5,000 2010 15,000
1991 5,000 2011 15,000
1992 5,000 2012 15,000
1993 5,000 2013 15,000
1994 5,000 2014 20,000
1995 5,000 2015 20,000
1996 5,000 2016 20,000
1997 10,000 2017 20,000
1998 10,000 2018 20,000
in any coin or currency which is legally acceptable on the
respective dates of payments for debts due the United States
of km~rica and to pay interest on the balance of said prin-
cipal from time to time remaining unpaid in like coin or
currency at the rate of 5% per annum payable annually on the
day of of each year from date hereof
until the principal amount hereof has been paid or such
payment has been duly provided for.
Payments of principal and interest shall be made by the
City Treasurer directly to the registered owner hereof at
the address last provided by it to the City for such purpose.
Upon final payment of the principal and interest, this bond
shall be submitted to the City for cancellation and surrender.
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Both principal of and interest on this bond are payable
solely out of the special account of the City known as the
1978 Water Revenue Bond Fund (the "Bond Fund"l, created by
Ordinance No. tqq~ of the City ~herein called the "Ordinance").
In addition to the installments of principal required
to be paid by the City as hereinabove set forth, the City,
at its option so long as the Payee is the registered owner
of this bond, shall have the right to prepay any or all
unpaid installments, at any time, in multiples of $5,000, in
the inverse chronological order of such installments, at the
principal amount thereof plus accrued interest to the date
of prepayment. If an Alternate Payee is the registered
owner of this bond, the City, at its option, shall have the
right to prepay any or all unpaid installments, on any
interest payment date on or after ten years from the date of
issue, in multiples of $5,000, in the inverse chronological
order of such installments, at the principal amount thereof
plus accrued interest to the date of prepayment.
Notice of any such optional prepayment shall be given
at least ten days prior to the prepayment date by mailing to
the registered owner of this bond a notice fixing such
prepayment date, and the amount of the principal to be
prepaid.
As provided in the Ordinance, this bond is exchangeable,
at the sole expense of the City, at any time upon ninety
days' notice at the request of the registered owner hereof,
and upon surrender of this bond to the City, for definitive
coupon bonds payable to bearer, of the denomination of
$5,000 each, bearing interest at the same rate as this bond,
with the same rights of redemption as provided for definitive
bonds in Section 5 of the Ordinance, in an aggregate princi-
pal amount equal to the unpaid principal amount of this bond
and in the form of such coupon bonds as provided for in
Section 7 of the Ordinance.
This bond is issued for the purpose of providing funds
to pay part of the cost of acquiring, constructing and
installing certain additions and improvements to and exten-
sions of the water and sewer system of the City, is payable
solely out of the Net Revenue of such System (as defined in
the Ordinance) and all additions and improvements thereto
and extensions thereof, and does not constitute a general
indebtedness of the City.
The City hereby covenants and agrees with the owner and
holder of this bond that it will keep and perform all the
covenants of this bond and of the Ordinance to be by it kept
and performed.
The City has pledged and bound itself to set aside from
the Net Revenue of its water and sewer system and all addi-
tions and improvements thereto and extensions thereof, and
pay into the Bond Fund the various amounts required by the
Ordinance to be paid into and maintained in the Bond Fund
all within the times provided in said Ordinance.
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Said amounts so pledged to be paid into said Bond Fund
are hereby declared to be a lien and charge upon such Net
Revenue junior to the lien and charge thereon to pay and
secure the outstanding water and sewer revenue bonds of the
City issued under date of December 1, 1959, pursuant to
Ordinance No. 1379 of the City and issued under date of
January 1, 1967, pursuant to Ordinance No. 1506 of the City,
and any water and sewer bonds hereafter issued by the City,
and superior to all other charges of any kind or nature.
The City has further bound itself to maintain said
System in good condition and repair, to operate the same in
an efficient manner and at a reasonable cost, and to estab-
lish, maintain and collect rates and charges for water and
sewer service furnished for as long as any of the bonds of
this issue are outstanding that will provide Net Revenue and
Assessments (as defined in the Ordinance), at least equal to
1.10 times the maximum amount required each calendar year
hereafter to pay and secure the payment of the principal of
and interest on the bonds of this issue after the principal
of and interest on the outstanding water and sewer revenue
bonds of the City issued under date of December 1, 1959, and
issued under date of January 1, 1967, and any outstanding
water and sewer bonds hereafter issued by the City, have
been paid.
This bond may be assigned, and upon such assignment the
assignor shall promptly notify the City Treasurer by regis-
tered mail.
It is hereby certified that all acts, conditions and
things required to be done precedent to and in the issuance
of this bond have happened, been done and performed, and
that the total indebtedness of the City including this bond
does not exceed any constitutional, statutory or charter
limitation.
IN WITNESS WHEREOF, the City of Port Townsend, Washington,
has caused this bond to be executed on behalf of the City
with the facsimile (manual) signature of its Mayor, to be
attested by the City Clerk, and the seal of the City to be
impressed hereon, as of the __ day of ,
1978.
ATTEST:
CITY~ORT TOWNSEND, WASHINGTON
~/ Mayor
A fully registered bond shall have endorsed thereon the
following form of assignment:
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered owner
thereof hereby sells, assigns and transfers the within bond
unto .
DATED
In the presence of:
(Repeat this form of assignment)
As provided in the within bond, notice of any assign-
ment thereof shall be given by the assignor by registered
mail to the City Treasurer, Port Townsend, Washington, and
upon the receipt of such notice the bond shall be registered
as to both principal and interest on the registration books
of the City in the name of the assignee named above.
Section 9. Any fully registered bond shall be redeemable,
in whole or in part, to the extent, at the time, in the manner
and at the prices set forth in Sections 5 and 6 hereof, except
that the only notice required shall be notice sent to the regis-
tered owner by registered mail at least ten (10) days prior to
the redemption date.
Any fully registered bond may also be transferred by the
registered owner thereof, provided that such transfer relates to
the entire principal amount of the fully registered bond trans-
ferred, and any such transfer shall be noted on the bond registra-
tion book of the City.
Upon ninety days' written notice by the holder of any fully
registered bond, the City shall cause to be prepared and shall
deliver to such holder, at the City's sole cost and expense,
definitive coupon bonds of type composition and on bond paper of
weight and strength that is customarily used for serial bonds of
an issue comparable to this issue of Bonds.
Such definitive bonds shall be in the denomination of $5,000
each, shall be in the total principal sum of the unpaid balance
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due on such fully registered bond, shall be numbered and mature
as provided in Section 3 hereof on those dates of maturity which
have not yet occurred on the date of such exchange, except that
if any prepayment authorized herein shall have been effected,
such prepayment shall be deemed to have redeemed such definitive
bonds in inverse numerical order. Such definitive bonds shall be
executed as herein provided for the Bonds.
Section 10. Pledge of Revenues. The Bonds, together with
the interest thereon, shall be payable from the Net Revenue of
the System and that portion of said Net Revenue which is suf-
ficient and necessary to pay the principal of and interest on the
Bonds as the same shall become due is hereby pledged and set
aside out of the Revenue Fund into the Bond Fund.
Said amounts so pledged are hereby declared to be a lien and
charge upon such Net Revenue and the money in the Revenue Fund
junior to the lien and charge thereon to secure and pay the
principal of and interest on the Outstanding Bonds of the City
and superior to all other charges of any kind or nature.
Section 11. Investment of Moneys. All money in the Bond
Fund may be kept in cash or invested in any legal investment
maturing not later than 20 years from date of purchase, and in no
event maturing later than the last maturity of the Bonds outstand-
ing at the time of such purchase.~ Interest earned on or profits
made from the sale of such investments shall be deposited in and
become a part of the Bond Fund.
Section 12. Protection and Disposition of Funds. The "1978
Water Construction Fund" (hereinbefore defined as the "Construc-
tion Fund") has been heretofore established in accordance with
Ordinance No. of the City. The proceeds of sale of the
Bonds (except for accrued interest, if any, which shall be paid
into the Bond Fund) and all moneys received from the federal
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government and the State of Washington to pay part of the cost of
the improvements authorized by Ordinance No. i~qTshall be
deposited in the Construction Fund. Interest earned on Construc-
tion Fund moneys shall be deposited in the Construction Fund.
The City's share of any unliquidated damages and any moneys
paid by defaulting contractors or their sureties shall be deposited
in the Construction Fund to assure completion of all of the
additions and improvements to and extensions of the System to be
made.
The following funds and accounts shall be continually main-
tained, except as otherwise provided, for as long as any of the
Bonds remain outstanding:
A. Revenue Fund. The Gross Revenue shall be set aside
into the Revenue Fund.
B. Bond Fund. There is hereby created a "1978 Water
Revenue Bond FUnd" (hereinbefore defined as the "Bond Fund") for
the purpose of paying and securing the payment of the principal
of and interest on the Bonds. The City shall set aside and
transfer therein from the Revenue FUnd on or before the 20th day
of each month, commencing with the month of March, 1978, and
continuing each month for as long as any of the Bonds are outstand-
ing, an amount equal to at least one-twelfth (or such larger
amount as may be necessary) of the annual installments of princi-
pal and interest coming due on the Bonds on the next succeeding
anniversary of the date of issue of the Bonds.
If the City for any reason shall fail to make such monthly
transfers, then an amount equal to the deficiency shall be set
apart and deposited in the Bond Fund out of the Revenue Fund in
the ensuing month or months, which amount shall be in addition to
the regular monthly deposit required during such succeeding month
or months.
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If there ever shall be accumulated in the Bond Fund amounts
in excess of the requirements thereof during the next 12 months
for payment of the principal of and interest on the Bonds outstand-
ing, such excess may be used by the City to call Bonds for redemp-
tion prior to their fixed maturities as authorized herein, or may
be invested as provided in Section 1I hereof.
Section 13. Other Covenants and Agreements. The City
hereby covenants and agrees with the owners and holders of the
Bonds for as long as any of the same remain unpaid as follows:
a. It will acquire all necessary property, both real and
personal, easements, and rights-of-way necessary for the acquis-
ition, construction and installation of the additions, improve-
ments and extensions to the System authorized by Ordinance No.
b. It will at all times keep and maintain the System in
good repair, working order and condition, will at all times
operate the System and the business in connection therewith in an
efficient manner and at a reasonable cost, and will comply with
all applicable laws of the State of Washington.
c. It will impose and collect rates and charges for service
rendered by the System which are reasonable and such that Gross
Revenue paid into the Revenue Fund will be sufficient at all
times to provide for the payment of the Costs of the Maintenance
and Operation and the installments of principal and interest on
the Outstanding Bonds and on the Bonds, that all service rendered
by the System shall be subject to the full rates prescribed by
the rules and regulations of the City, and that no free service
by the System will be permitted.
d. It will maintain complete books and records relating to
the operation of the System and its financial affairs, and will
cause such books and records to be audited annually at the end of
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each fiscal year, and will furnish the Government, without request,
a copy of each annual audit report. At all reasonable times the
Government shall have the right to inspect the System and the
records, accounts and data of the City relating thereto.
e. It will carry fire and extended coverage insurance on
the System as is ordinarily carried on the property of similar
public utilities by private companies engaged in the operation of
the same, to the full insurable value thereof, and will also
carry adequate public liability insurance, war risk insurance, if
it becomes available, and other kinds of insurance as under good
practices are ordinarily carried on the properties of similar
public utilities by private companies engaged in the operation of
the same. The premiums paid for all such insurance shall be
regarded and paid asa Cost of Maintenance and Operation of the
System.
Section 14. Adequacy of Revenues. The corporate authorities
of the City hereby declare in fixing the amounts to be paid into
the Bond Fund as hereinbefore provided that they have exercised
due regard for the Costs of Maintenance and Operation of the
System, and have not obligated the City to set aside and pay into
the Bond Fund a greater amount of money in the Revenue Fund than
in their judgment will be available over and above such Costs of
Maintenance and Operation, and the cost of debt service on the
Outstanding Bonds now outstanding.
Section 15. Defeasance. In the event that money and/or
"Government Obligations," as such obligations are now or hereafter
defined in Chapter 39.53 R.C.W., maturing or having guaranteed
redemption prices at the option of the holder at such time or
times and bearing interest to be earned thereon in amounts
(together with such money, if any) sufficient to pay at maturity
or redeem and retire part or all of the Bonds in accordance with
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their terms, are hereafter irrevocably set aside in a special
account and pledged to effect such payment, redemption and retire-
ment, then no further payments need be made into the Bond Fund or
any account therein for the payment of the principal of and
interest on the Bonds so provided for and such Bonds and appurte-
nant coupons shall then cease to be entitled to any lien, benefit
or security of this ordinance, except the right to receive the
funds so set aside and pledged, and such Bonds and appurtenant
coupons shall no longer be deemed to be outstanding hereunder, or
under any ordinance authorizing the issuance of bonds, warrants
or other indebtedness of the City.
Section 16. Issuance of Bonds Senior to Bonds of this Issue..
The City reserves the right to hereafter issue water and sewer
bonds which shall be a lien and charge upon the Net Revenue (plus
Assessments, if applicable) of the System senior to the lien and
charge thereon to secure and pay the principal of and interest on
the then outstanding Bonds of this issue, but only upon compliance
with the following conditions:
a. That at the time of issuance of such water and sewer
bonds, the City is in compliance with the requirements of Section
12 of this ordinance and is not in default in meeting payments
required into any bond fund or reserve account securing any
Outstanding Bonds.
b. That the City Engineer shall certify that the Net
Revenue (plus Assessments, if applicable) (1) for any 12-month
period of the 24 months preceding the date of delivery of such
water and sewer bonds to be issued or (2) projected by him to be
received annually following the date of delivery of the water and
sewer bonds to be issued, is not less than 1.1 times the amount
required in any future year to pay the principal of and interest
on the Bonds after payment of debt service on the Outstanding
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Bonds then outstanding and to be issued, and payments into
any reserve account required by the ordinance authorizing
the issuance of any such Outstanding Bonds.
If the Government is notified of the intention of the City
to hereafter issue any such water and sewer bonds and such notice
is accompanied by the above described certification of the City
Engineer, the failure of the Government to make written objection
to the issuance of such water and sewer bonds within thirty
calendar days of receipt of such notification shall be deemed to
constitute a finding by the Government that the above conditions
to the issuance of such water and sewer bonds have been met and
the Government may not thereafter challenge the issuance of such
water and sewer bonds.
Section 17. Ordinance a Contract. The provisions of this
ordinance shall constitute a contract between the City and the
Government so long as any of the Bonds remain unpaid.
Section 18. Sale of Bonds. The Bonds shall be sold to the
Government in accordance with its Offer of Loan and Grant, dated
September 21, 1977, and the City's Acceptance of Offer of Loan
and Grant dated September 22, 1977. The acceptance by the City
of said Offer of Loan and Grant is hereby ratified and confirmed.
The proper officials of the City are hereby authorized and
directed to do all things necessary for the prompt execution and
delivery of the Bonds and for the proper use and application of
the proceeds of sale thereof.
Section 19. Supplements and Amendments.
a. The City Council from time to time and at any time may
adopt an ordinance or ordinances supplemental hereof, which
ordinance or ordinances thereafter shall become a part of this
ordinance, for any one or more or all of the following purposes:
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(1) To add to the covenants and agreements of the City in
this ordinance contained other covenants and agreements thereafter
to be observed, which shall not adversely affect the interests of
the holders of any Bonds, or to surrender any right or power
herein reserved to or conferred upon the City.
(2) To make such provisions for the purpose of curing any
ambiguities or of curing, correcting or supplementing any defec-
tive provision contained in this ordinance in regard to such
matters or questions as the Commission may deem necessary or
desirable and not inconsistent with this ordinance and which
shall not adversely affect the interest of the holders of Bonds.
Any such supplemental ordinance of the Council may be
adopted without the consent of the holders of any Bonds at any
time outstanding, notwithstanding any of the provisions of subsec-
tion b of this section.
b. With the consent of the holders of not less than 65%.
in aggregate principal amount of the Bonds at the time outstanding,
the City Council may adopt an ordinance or ordinances supplemental
hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this ordinance
or of any supplemental ordinance; provided, however, that no such
supplemental ordinance shall:
(1) Extend the fixed maturity of any Bonds, or reduce the
rate of interest thereon, or extend the time of payments of
interest from their due date, or reduce the amount of the princi-
pal thereof, or reduce any premium payable on the redemption ~
thereof, without the consent of the holder of each bond so affected;
or
(2) Reduce the aforesaid percentage of bondholders required
to approve any such supplemental ordinance, without the consent
of the holders of all of the Bonds then outstanding.
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It shall not be necessary for the consent of bondholders
under this subsection b to approve the particular form of any
proposed supplemental ordinance, but it shall be sufficient if
such consent shall approve the substance thereof.
c. Upon the adoption of any supplemental ordinance pursuant
to the provisions of this section, this ordinance shall be
deemed to be modified and amended in accordance therewith, and
the respective rights, duties and obligations of the City under
this ordinance and all holders of Bonds outstanding hereunder
shall thereafter be determined, exercised and enforced thereunder,
subject in all respects to such modification and amendments, and
all the terms and conditions of any such supplemental ordinance
shall be deemed to be part of the terms and conditions of this
ordinance for any and all purposes.
Section 20. Severability. If any one or more of the
covenants and agreements provided in this ordinance to be performed
on the part of the City shall be declared by any court of competent
jurisdiction to be contrary to law, then such covenant or covenants,
agreement or agreements, shall be null and void and shall be
deemed separable from the remaining covenants and agreements in
this ordinance and shall in no way affect the validity of the
other provisions of this ordinance or of any Bonds.
Section 21. Effective Date. This ordinance shall become
effective five days from and after its passage, approval and
publication.
PASSED by the Council of the City of Port Townsend, Washington,
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at a meeting of said Council held this 7z~ day of F~q~ ,
1978, and approved by the Mayor on said date.
CITY OF PORT TOWNSEND,
WASHINGTON
Mayor
Attest:
By
.... ty ~C1
C1 erk
Approved as to Form:
By
City Attorney
Published
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I, , do hereby certify that I am the
duly chosen, qualified and acting Clerk of the City of Port
Townsend, Washington, and the custodian of its records, that the
attached and foregoing is a full, true and correct coyp of
Ordinance No. , and that said ordinance was adopted by the
affirmative vote of the Port Townsend City Council at a meeting
of , 1978, at which a quorum of the Council was
present; that said Ordinance has not been altered or amended, and
the same is in full force and effect.
IN WITNESS WHEREOF, I have hereunto set my hand this
day of , 1978.
City Clerk