HomeMy WebLinkAbout2293 Issuance and Sale of LID #1 BondsORDINANCE NO. ~?~
AN ORDINANCE of the City Council of Port
Townsend, Washington, authorizing the
issuance and sale of Local Improvement
District No. 1 Bonds in the principal amount
of $347,054.06; providing the form, terms,
conditions and covenants of said Bonds;
providing for the sale thereof; and providing
for the disposition of the proceeds of the
sale.
WHEREAS, the City Council of the City of Port Townsend,
Washington (the "City"), ~y Ordinance No. 2097, passed on
January 19, 1988, created Local Improvement District No. 1 (the
"District"), created a special fund of the City (the "LID No. 1
Fund"), and provided for the issuance of local improvement
district bonds and interim short-term obligations to pay the cost
of improvements in the District and the expenses incidental
thereto; and
WHEREAS,
confirmed in
ordinance and in the following amount:
LID No.
1
the assessment roll for the District has been
the manner required by law by the following
Ordinance Amount
Confirming Amount of Amount of Unpaid
Roll Assess. ment Prepaid Assessments
2282 $416,932.46
$69,878.40 $347,054.06
WHEREAS, it is deemed necessary and desirable that the City
issue Local Improvement District No. 1 Bonds in the amount of
$347,054.06 to repay the Local Improvement District Bond
Anticipation Notes in the principal amount of $450,000 (the
"Notes") and to pay part of the costs of the improvements made in
the District;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF PORT TOWNSEND, WASHINGTON, AS FOLLOWS:
Section 1. Definitions. As used in this ordinance the
following terms shall have the following meanings, unless a
different meaning clearly appears from the context:
"Assessments" means the assessments levied in Local Improve-
ment District No. 1, which assessments are pledged to be paid
into the LID No. 1 Fund, including installments thereof and any
interest and penalties due or which may become due thereon.
"Bonds" means the Local Improvement District No. 1 Bonds,
1992 authorized by this ordinance to be issued.
"Bond Reqister" means the books or records maintained by the
Bond Registrar containing the name and mailing address of the
owner of each Bond or nominee of such owner and the principal
amount and number of Bonds owned by each owner or nominee.
"Bond Registrar" means the fiscal agents of the State of
Washington in Seattle, Washington, and New York, New York, for
the purposes of registering and authenticating the Bonds, main-
raining the Bond Register, effecting the transfer of ownership of
the Bonds, and paying the principal of and interest on the Bonds
as the same become due and payable.
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"Bond Year" means the one year period beginning on the date
of issuance of the Bonds and ending one year later and each
subsequent one year period.
"City" means the City of Port Townsend, Washington, a munic-
ipal corporation duly organized and existing under and by virtue
of the Constitution and laws of the State of Washington.
"Computation Date" means the Installment Computation Date or
the Final Computation Date.
"Council" means the general legislative authority of the
City as the same shall be duly and regularly constituted from
time to time.
"District" means Local Improvement District No. 1 of the
City.
"Final Computation Date" means the date that the last Bond
is discharged. A Bond is discharged on the date that all amounts
due under the terms of the Bond are actually and unconditionally
due if cash is available at the place of payment and no interest
accrues with respect to the Bond after such date.
"Guaranty Fund" means the Guaranty Fund of the City
authorized and maintained pursuant to Ch. 35.54 RCW.
"Improvements" means the improvements made and to be made
within the District as described in Ordinance No. 2097.
"Installment Computation Date" means the last day of the
fifth Bond Year and of each succeeding fifth Bond Year.
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"LID No. 1 Fund" means the Local Improvement District No. 1
Fund created by Ordinance No. 2097 of the City.
"Nonpurpose Payments" means, in general, any payment with
respect to an investment allocated to the Bonds. The following
types of payments are specifically included:
a) Direct Payments. The amount of gross proceeds of the
Bonds directly used to purchase the investment. Direct payments
do not include brokerage commissions, administrative expenses or
similar expenses.
(b) Constructive Payments. The fair market value (as of
the date of allocation to the Bonds) of any investment that was
not directly purchased with gross proceeds of the Bonds, but
which is allocated to the Bonds.
(c) Payments of Rebatable Arbitrage. Any payment of
Rebatable Arbitrage if such payment is made no later than the due
date for such payment.
"Nonpurpose Receipts" means, in general, any receipt with
respect to an investment allocated to the Bonds. The following
types of receipts are specifically included:
(a) Actual Receipts. Any amount actually or constructively
received with respect to an investment. Actual receipts may not
be reduced by selling commissions, administrative expenses or
similar expenses.
(b) Disposition Receipts. An amount determined by treating
an investment that ceases to be allocated to the Bonds (other
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than by reason of a sale or retirement) as if sold for fair
market value on the date that the investment ceases to be
allocated to the Bonds.
(c) Installment Date Receipts. The fair market value (or,
for fixed rate investments, present value) of all investments
allocated to the Bonds at the close of business on any
Computation Date.
(d) Imputed Receipts. Any receipts that are required to be
imputed and taken into account pursuant to Section 1.148-5T of
the Temporary Income Tax Regulations or any successor Temporary
or Final Income Tax Regulations.
"Rebate Computation Certificate" means the certificate
executed by the City setting forth the methodology for
computation of Rebatable Arbitrage.
Section 2. Authorization of Bonds. After payment in full
of the Notes previously issued to provide funds for the making of
improvements in the District, all money received by the City in
payment of, penalties, if any, and interest on the Assessments
levied in the District shall be paid into the LID No. 1 Fund and
used to pay the principal of and interest on the Bonds, and as
security for such payment the LID No. 1 Fund is hereby pledged.
For the purpose of repaying the Notes and paying the costs
of the Improvements, the City shall issue its Local Improvement
District No. 1 Bonds, 1992 (the "Bonds") in the aggregate
principal amount of $347,054.06. The Bonds shall be dated as of
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April 15, 1992, shall be numbered in the manner set forth below
and with any additional designation as the Bond Registrar deems
necessary for the purpose of identification and control, shall be
in the denomination of $5,000 each or any integral multiple
thereof except for Bond No. 1, which shall be in the denomination
of $7,054.06, and shall bear interest from their date at the
rates set forth on the offer to purchase the Bonds that is
attached to this ordinance and incorporated herein by reference.
Interest shall be payable annually beginning April 15, 1993, and
annually thereafter on the 15th day of April of each year, and
shall mature April 15, 2004:
Bond Nos. Amounts
1-9 $47,054.06
10-18 45,000.00
19-27 45,000.00
28-35 40,000.00
36-43 40,000.00
44-50 35,000.00
51-56 30,000.00
57-61 25,000.00
62-65 20,000.00
66-69 20,000.00
The Bonds shall be obligations only of the LID No. 1 Fund
and the Guaranty Fund of the City and shall not be general
obligations of the City.
Both the principal of and interest on the Bonds shall be
payable in lawful money of the United States of America. Inter-
est on the Bonds shall be paid by check or draft mailed to
registered owners or assigns at the addresses appearing on the
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Bond Register as of the first day of the month in which an
interest payment is due. Principal of the Bonds shall be payable
upon presentation and surrender of the Bonds by the registered
owners at the principal offices of the Bond Registrar.
Section 3. Bond Register and Exch~nqe of Bond~. The Bond
Register shall be maintained by the Bond Registrar, and shall
contain the name and mailing address of the owner or owners of
each Bond or nominee of such owner or owners and the principal
amount and number of Bonds held by each owner or nominee.
Upon surrender thereof to the Bond Registrar, the Bonds are
interchangeable for Bonds in any authorized denomination of an
equal aggregate principal amount and of the same interest rate
and maturity. Bonds may be transferred only if endorsed in the
manner provided thereon and surrendered to the Bond Registrar.
Such exchange or transfer shall be without cost to the owner or
transferee.
Section 4. Redemption. The Bonds shall be redeemed at par
in advance of their scheduled maturity, by application of Assess-
ments and prepayments thereof, in whole or in part in numerical
order, on any interest payment date whenever there shall be suf-
ficient money in the LID No. 1 Fund to pay the same and all Bonds
which mature at such time, over and above an amount sufficient
for the payment of the interest next accruing on all unpaid
Bonds. The Bonds are callable from Assessments only through
April 15, 1997 and thereafter from Assessments and other funds
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NMN569 92/04/02
deposited into the LID No. 1 Fund. The Bond Registrar shall
maintain a system of numbering which shall permit reissued and/or
transferred Bonds to be called in accordance with their original
number at the time of issuance.
Notice of any such intended redemption shall be given not
less than 30 days nor more than 60 days prior to the date fixed
for redemption by first class mail, postage prepaid, to the
registered owner of any Bond to be redeemed at the address
appearing on the Bond Register. The requirements of this section
shall be deemed to be complied with when notice is mailed as
herein provided regardless of whether or not it is actually
received by the owner of any Bond.
Interest on any Bond so called for redemption shall cease to
accrue on the date fixed for redemption unless such Bond or Bonds
so called are not redeemed upon presentation made pursuant to
such call.
Section 5. Payment of Assessments and Interest on Assess-
ments. The City has heretofore levied Assessments payable into
the LID No. 1 Fund by Ordinance No. 2282 in the total amount of
$416,932.46, of which $69,878.40 was prepaid prior to the passage
of this ordinance and $347,054.06 remains payable in ten equal
annual installments together with interest and penalties thereon
in the manner and at the times specified in the ordinance
confirming the assessment roll for the District. The balance of
Assessments remaining unpaid at the end of the thirty-day
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Nt, tN569 92/04/02
prepayment period shall bear interest at a rate which is 1/2%
greater than the net effective interest rate on the Bonds. Both
principal of and interest on the Bonds are payable solely out of
the LID No. 1 Fund and from the Local Improvement Guaranty Fund
of the City.
Section 6. Form of Bonds.
tially the following form:
NO.
REGISTERED OWNER:
PRINCIPAL AMOUNT:
INTEREST RATE-
The Bonds shall be in substan-
UNITED STATES OF AMERICA
STATE OF WASHINGTON
CITY OF PORT TOWNSEND
LOCAL IMPROVEMENT DISTRICT
NO. 1 BONDS, 1992
MATURITY DATE: April 15, 2004
Laws of Washington 1965,
part, as follows:
Chapter 7,
§ 35.45.070 provides, in
Neither the holder nor owner of any bond, interest coupon,
or warrant issued against a local improvement fund shall have any
claim therefor against the city or town by which it is issued,
except for payment from the special assessments made for the
improvement for which the bond or warrant was issued and except
also for payment from the local improvement guaranty fund of the
city or town as to bonds issued after the creation of a local
improvement guaranty fund of the city or town. The city or town
shall not be liable to the holder or owner of any bond, interest
coupon, or warrant for any loss to the local improvement guaranty
fund occurring in the lawful operation thereof.
The City of Port Townsend, Washington, a municipal
corporation of the State of Washington, hereby promises to pay to
the registered owner hereof solely out of the sources referred to
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herein, on the Maturity Date set forth above, the Principal
Amount set forth above in lawful money of the United States of
America, with interest on the unpaid balance hereof from the date
hereof at the Interest Rate per annum set forth above payable
April 15, 1993, and annually thereafter on April 15 of each year
until payment of the principal sum has been made or duly provided
for. Interest on this Bond is payable by check or draft mailed
on the date such interest is due to the registered owner hereof
at the address appearing on the bond registration books of the
City as of the 1st day of the month in which an interest payment
is due. Principal payments shall be made to the registered owner
hereof only upon presentation and surrender of this bond at the
office of the fiscal agent of the State of Washington in Seattle,
Washington or New York, New York (the "Bond Registrar").
This Bond, both principal and interest, is payable only out
of the Local Improvement District No. 1 Fund (the "LID No. 1
Fund") created by Ordinance No. 2097 of the City, and from the
local improvement guaranty fund of the City created pursuant to
Chapter 209, Session Laws, 1927, and acts amendatory thereof.
The City has irrevocably obligated and bound itself to pay into
the LID No. 1 Fund all assessments levied within LID No. 1. The
owner of this Bond shall have no claim therefor against the City
of Port Townsend except for payment from the special assessments
made for the improvements for which this Bond was issued, and
except as against the local improvement guaranty fund of the
City, and the City shall not be liable to any owner of such Bond
for any loss to the guaranty fund occurring in the lawful
operation thereof by the City. The remedy of the owner of this
Bond in case of nonpayment of either principal or interest shall
be confined to the enforcement of .the assessments and to the
guaranty fund. The Bonds are not general obligations of the
City.
The Bonds have been designated as "qualified tax-exempt
obligations."
It is hereby certified and declared that this Bond is issued
pursuant to and in strict compliance with the Constitution and
laws of the State of Washington and ordinances of the City, and
that 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 of Port Townsend, Washington,
has caused this Bond to be signed on behalf of the City with the
manual or facsimile signature of its Mayor, to be attested by the
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manual or facsimile signature of its Clerk, and the official seal
of the City to be impressed or imprinted hereon this 15th day of
April, 1992.
CITY OF PORT TOWNSEND, WASHINGTON
SEAL
ATTEST:
By
Mayor
City Clerk
CERTIFICATE OF AUTHENTICATION
Date of Authentication:
This bond is one of the bonds described in the within-men-
tioned Bond Ordinance and is one of the Local Improvement
District No. 1 Bonds, 1992, of the City of Port Townsend.
Washington State Fiscal Agency,
Bond Registrar
By
Authorized Officer
ADDITIONAL PROVISIONS
This Bond is one of an issue aggregating the principal sum
of $347,054.06 authorized by Ordinance No. __of the City and
is issued to pay for improvements in Local Improvement District
No. 1. The Bonds of this issue are subject to redemption in
advance of their scheduled maturity, in whole or in part, in
numerical order, at par plus accrued interest to the date of
redemption, on any interest payment date whenever there shall be
sufficient money in the LID No. 1 Fund to pay the same and all
Bonds of Local Improvement District No. 1 prior in number to the
last Bond to be redeemed over and above an amount sufficient for
the payment of the interest next accruing on the unpaid Bonds of
Local Improvement District No. 1. Notice of any such intended
redemption shall be given by mail to the registered owners of the
bonds to be redeemed at the addresses appearing on the bond
registration books maintained by the Bond Registrar not more than
60 nor fewer than 30 days prior to such redemption date.
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This Bond is transferable only upon the bond registration
books of the Bond Registrar maintained for that purpose, upon the
surrender of this Bond by the registered owner hereof or his or
her agent duly authorized in writing, together with a written
instrument of assignment in form, attached hereto, duly executed
by the registered owner or his or her duly authorized agent, for
re-registration on the bond registration books and on the
registration certificate on this Bond. The Bond Registrar and
City may deem the person in whose name this Bond is registered to
be the absolute owner hereof for the purpose of receiving payment
of the principal of and interest on this Bond and for any and all
other purposes whatsoever.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers unto
PLEASE INSERT SOCIAL SECURITY OR TAXPAYER IDENTIFICATION NUMBER
OF TRANSFEREE
(Please print or typewrite name and address, including zip code,
of Transferee)
the within bond and does hereby irrevocably constitute and
appoint of or its
successor, as Bond Registrar to transfer said bond on the books
kept for registration thereof with full power of substitution in
the premises.
DATED:
SIGNATURE GUARANTEED:
NOTE: The signature on this Assignment
must correspond with the name of the
registered owner as it appears upon the
face of the within bond in every par-
ticular, without alteration or enlarge-
ment or any change whatever.
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N##569 92/04/02
Section 7. Execution of Bonds. The Bonds shall be signed
on behalf of the City by the manual or facsimile signature of the
Mayor, shall be attested by the manual or facsimile signature of
the City Clerk, and shall have the corporate seal of the City
impressed or imprinted.
Only such Bonds as shall bear thereon a Certificate of
Authentication in the form hereinbefore recited, manually
executed by the Bond Registrar, shall be valid or obligatory for
any purpose or entitled to the benefits of ~his ordinance. Such
Certificate of Authentication shall be conclusive evidence that
the Bonds so authenticated have been duly executed, authenticated
and delivered hereunder and are entitled to the benefits of this
ordinance.
In case either of the officers who shall have executed the
Bonds shall cease to be such officer or officers of the City
before the Bonds so signed shall have been authenticated or deli-
vered by the Bond Registrar, or issued by the City, such Bonds
may nevertheless be authenticated, delivered and issued and upon
such authentication, delivery and issuance, shall be as binding
upon the City as though those who signed the same had continued
to be such officers of the City. Any Bond may also be signed and
attested on behalf of the City by such persons as at the actual
date of execution of such Bond shall be the proper officers of
the City although at the original date of such Bond any such
per~on shall not have been such officer of the City.
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92/04/02
Section 8.. Bond Registrar. The Bond Registrar shall be the
fiscal agencies of the State of Washington. The Bond Registrar
shall keep, or cause to be kept, sufficient books or records for
the registration and transfer of the Bonds. The Bond Registrar
is authorized to authenticate and deliver the Bonds transferred
or exchanged in accordance with the provisions of such Bonds and
this ordinance and to carry out all of the Bond Registrar's pow-
ers and duties under this ordinance.
Section 9. Defeasance. In the event that money and/or
"Government Obligations" (as now or hereafter defined in RCW Ch.
39.53 or its successor statute, if any) maturing at such time or
times and bearing interest to be earned thereon in amounts
(together with such money if necessary) sufficient to redeem and
retire the Bonds or any of them in accordance with their terms
are set aside in a special account to effect such redemption or
retirement and such money and/or the principal of and interest on
such obligations are irrevocably set aside and pledged for such
purpose, then no further payments need be made into the LID No. 1
Fund for the payment of the principal of and interest on the
Bonds so provided for, and the owners of such Bonds shall 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 shall be deemed not to be outstanding hereunder.
Section 10. Sale of the Bonds. The offer dated April 6,
1992 for sale of the Bonds to Seattle-Northwest Securities
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Corporation, Seattle, Washington is hereby authorized and
approved. The appropriate City officials are hereby authorized
and directed to do everything necessary for the prompt issuance,
execution and delivery of the Bonds and for the proper
application and use of the proceeds thereof.
Section 11. Bonds Designated "Qualified Tax-Exempt Obliga-
tions.'' The Bonds are hereby designated as "qualified tax-exempt
obligations" for purposes of Section 265(b) of the Internal
Revenue Code of 1986.
Section 12. Lost or Destroyed Bonds. In case the Bonds or
any of them shall be lost, stolen or destroyed, the Bond
Registrar may execute and deliver a new Bond or Bonds of like
amount, date, and tenor to the registered owner thereof upon the
owner paying the expenses and charges of the City and the Bond
Registrar in connection therewith and upon his/her filing with
the Bond Registrar evidence satisfactory to said Bond Registrar
that such Bond or Bonds were actually lost, stolen or destroyed
and of his/her ownership thereof, and upon furnishing the Bond
Registrar with indemnity satisfactory to such Bond Registrar.
Section 13. Bonds Not Arbitrage Bonds; Not Private Activity
Bonds; Special Designation. The City covenants and agrees that
throughout the term of the Bonds no part of the proceeds of the
Bonds or any other moneys or obligations held under this
ordinance shall at any time be used for any purpose or invested
in such a manner, nor shall the City take any other action, which
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would cause the Bonds to be (i) "arbitrage bonds" under the
Internal Revenue Code of 1986 (the "Code") or (ii) "private
activity bonds" under the Code.
The City hereby designates the Bonds as "qualified tax-
exempt obligations" under Section 265(b) of the Code. The City
does not expect to issue tax-exempt obligations in an aggregate
principal amount in excess of $10,000,000 during calendar year
1992.
Section 14. Arbitraqe Rebate.
(a) General Rule. The City will pay to the United
States of America in accordance with the provisions of this
section (i) at least 90% of the Rebatable Arbitrage with respect
to the Bonds as of each Installment Computation Date, (ii) 100%
of the Rebatable Arbitrage with respect to the Bonds as of the
Final Computation Date and (iii) any income attributable to such
Rebatable Arbitrage.
(b) Computation of Rebatable Arbitraqe. The Rebatable
Arbitrage with respect to the Bonds computed in accordance with
the Rebate Computation Certificate and, as of each Computation
Date, will be the excess of:
(i) The future value of all Nonpurpose Receipts with
respect to the Bonds; over
(ii) The future value of all Nonpurpose Payments with
respect to the B°nds.
The future value will be computed as of each Computation Date.
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(c) Payment Procedure. (i) The payment of Rebatable
Arbitrage due as of each Installment Computation Date will be
paid no later than the date that is 60 days after the Installment
Computation Date.
(ii) The payment of Rebatable Arbitrage due as of
the Final Computation Date will be paid no later than the
latest of (a) the date that is 60 days after the Final
Computation Date, (b) the date that is 8 months after the
date of issuance of the Bonds, or (c) the date 60 days after
the earlier of the date that the City no longer expects to
spend gross proceeds of the Bonds within 6 months of the
date of issuance of the Bonds or 12 months after the date of
issuance of the Bonds.
(iii) Each payment of Rebatable Arbitrage will be
made to the Internal Revenue Service Center, Philadelphia.
Pennsylvania 19225 and will be accompanied by IRS Form
8038-T.
(d) Other Methodology. Notwithstanding this Section 14,
payments of Rebatable Arbitrage will be made in accordance with
instructions provided by Preston Thorgrimson Shidler Gates &
Ellis or other nationally recognized bond counsel if necessary to
maintain the federal income tax exemption for interest payments
made on the Bonds.
Section 15. Severability. If any one or more of the cove-
nants or agreements provided in this ordinance to be performed on
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NMN569 92/06,/02
the part of the City shall be declared by any court of competent
jurisdiction to be contrary to law, then such covenant or cove-
nants, agreement or agreements, shall be null and void and shall
be separable from the remainin~ covenants and a~reements in this
ordinance and shall in no way affect the validity of the other
provisions of this ordinance or of the Bonds.
Section 16. Prior Acts. Any act taken pursuant to the
authority of this ordinance but prior to its effective date is
hereby ratified and confirmed.
Section 17. Effective Date. This ordinance shall become
effective five days from its passage and publication as required
by law.
PA~SED by the City Council at a regular meetin9 held this
6th day of April, 1992.
ATTEST:
City Clerk
'/yor -
WASHINGTON
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