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HomeMy WebLinkAboutORD 4294 � ^�i !:� � T� q;` ` s. . �`.*. - J Y ' � ` � � , , � ' _.o � -�v�de J b o���4��� ��<o, � �. . , CITY OF RENTON, WASHINGTON . ORDINANCE NO. 4294 AN ORDINANCE relating to the waterworks utility of the City, including the sewerage system as a part thereof; specifying and adopting a system or plan of additions to and betterments and extensions of the waterworks utility; providing for the issuance of $4 , 100 , 000 par value Water and Sewer Revenue Bonds, 1990, of the City for the purpose of obtaining a part of the funds with which to pay the cost of carrying out that system or plan; fixing the date, form, denominations, maturities, interest rates, terms and covenants of those bonds; creating a special bond redemption account to provide for the payment of the bonds; and approving the sale and providing for the delivery of those bonds to Seattle-Northwest Securities Corporation, Seattle, Washington. WHEREAS, by Ordinance No. 1156, as amended by Ordinances Nos . 1157 and 1173, the sewerage system of the City of Renton (the "City" ) has become and is considered a part of the waterworks utility of the City (defined below as the "Waterworks Utility" ) ; and WHEREAS, by Ordinance No . 2020 the system of storm or surface water sewers was determined to consist as a part of the sewerage system and, together with the sewerage system, combined with the Waterworks Utility; and WHEREAS, by Ordinance No. 1450, the City provided for the issuance of its Water and Sewer Refunding and Improvement Revenue Bonds, 1953 (the "1953 Bonds") , and, by Section 15 of T t ' T � 1 r ; �I �` ' QRDINANCE NO. 4294 r + I � �hat ordinance, established certain conditions for the issuance of additianal water and sewer revenue bonds on a parity of lien with the 1953 Bands; and � � WHEREAS, all of the water and sewer revenue bonds of the � � Ci�y issued on a parity of lien with the 1953 Bonds pursuant ta i the original provisiQns a� Section 15 of Ordinance No. 1454 have been paid and redeemed, or irrevocable pravision for their payment and redemption has been made; and WHEREAS, by Ordinance No. 3169 , the City authorized the I� issuance of its Water and Sewer Revenue Refunding Bonds, 1977, � Issue No . 2 (the "'1977 Bands. Issue Na. 2" ) , and, by Section 13 of that ordinance, incarporated and amended Section 15 of 4rdinance No. 1450, all of which bonds have been paid and redeemed; and WHEREAS, by Ordinance No. 3188, the City authorized �he issuan�e of its Water and Sewer Revenue Refunding Bands, Issue No. 3 (the "1977 Bonds, Issue Na. 3" ) , and by Sectian 13 af that ardinance incorporated Section 15 of Ordinance No . 1450, as modified by Sectian I3 of Ordinance No. 3169; and WHEREAS, by Ordinance No. 3720, the City authorized the I issuance of its Water and Sewer Revenue Bonds, 1983 (the "1983 � � I, Bonds" ) , and, by Section 12 af that ordinance further modi£ied ren thened the rovisions of Section 15 of tJrdinance and st g P � No. 145Q, as modi£ied by Section 13 af Ordinance No. 3169; ancl WHEREAS, the City presently has outstanding, in additian to I � the 19�7 Bonds, Issue Na. 3, and 1983 Bonds, its Water and Sewer Revenue Bonds, 1985 (the "1985 Bonds" } , issued pursuant �o � - 2 - � � , � � r ' T ' ' � a ORDINANCE NO. 4294 , � Ordinance No. 3896, Water and Sewer Revenue Bonds, 1986 (the "1986 Bonds" ) , issued pursuant to Ordinance No. 3970 , Water and Sewer Revenue Bonds, 1987 (the "1987 Bonds" ) , issued pursuant to Ordinance No . 4068, Water and Sewer Revenue Bonds, 1988 (the "1988 Bonds" ) , issued pursuant to Ordinance No. 4157 and Water and Sewer Revenue Bonds, 1989 (the "1989 Bonds" ) , issued pursuant to Ordinance No . 4211, and Water and Sewer Revenue Refunding Bonds, 1989 (the "1989 Refunding Bonds" ) issued pursuant to Ordinance No. 4232, all of which bonds were issued on a parity of lien with the 1977 Bonds, Issue No . 3; and WHEREAS, the parity provisions of Section 13 of Ordinance No. 3188, which incorporated therein Section 15 of Ordinance No. 1450, as modified by Section 13 of Ordinance No. 3169, and as further modified and strengthened by Section 12 of Ordinance No. 3720 , provide that the City may issue additional water and sewer revenue bonds which will constitute a charge and lien upon the revenue of the Waterworks Utility of the City on a parity with the 1977 Bonds, Issue No. 3, the 1983 Bonds, the 1985 Bonds, the 1986 Bonds, the 1987 Bonds, the 1988 Bonds, the 1989 Bonds, the 1989 Refunding Bonds and any bonds issued thereafter and having a charge and lien upon the revenue of the Waterworks Utility on a parity with those bonds on compliance at the time of the issuance of such additional bonds with the following conditions : " (A) Al1 payments required by any ordinance to be paid into any bond redemption funds and accounts thereof created to secure the payment of bonds issued on a parity of lien - 3 - , � . , , , , , . , ORDINANCE NO. 4294 . , herewith shall have been made into h r I t e espective bond redemption funds and accounts thereof for the payment of such bonds and no deficiency exists therein; and " (B) The revenues of said waterworks system, including '� the sewerage system, shall be and be deemed sufficient, after the payment of operation and maintenance costs and taxes, based upon the historical experience of said systems or the , pro forma revenues under then existing rates over a period of '� any twenty-four consecutive months out of the thirty-six months immediately preceding the time of the issuance of such additional bonds, to equal at least 1 .3 times the average annual principal and interest requirements of the bonds of this issue then outstanding and of the revenue bonds proposed to be so issued. Such determination of the sufficiency of the revenues shall be made and certif ied to by an engineer experienced in municipal utilities; and " (C) The ordinance authorizing the issuance of such additional revenue bonds shall provide for the setting aside into a reserve fund or account of an amount not less than the average annual debt service requirement, both principal and interest of the additional revenue bonds proposed to be so issued, which reserve fund or account shall be maintained in such amount so long as any of said bonds are outstanding to the last maturity thereof" ; and WHEREAS, on June 11 , 1984, the City Council passed and the Mayor approved Resolutions Nos . 2546 and 2547 adopting the 1983 Comprehensive Sanitary Sewer Plan and 1983 Comprehensive Water System Plan, respectively, for the City, but for the purpose of financing facilities in those plans it is necessary to specify and adopt them by ordinance; and WHEREAS, the City Council has determined that it is necessary and in the best interests of the City that certain additional improvements described in the 1983 Comprehensive Water System Plan and the 1983 Comprehensive Sanitary Sewer Plan - 4 - . ' ' . r • 1 ORDINANCE N0. 4294 r , be made and there be adopted a system or plan of additions to and betterments and extensions of the Waterworks Utility; and WHEREAS, the City Council has determined that it is necessary to issue and sell $4, 100,000 par value of water and sewer revenue bonds to provide a part of the funds necessary to II carry out the system or plan providing for additions to and betterments and extensions of the Waterworks Utility and to pay the costs of issuance and sale of the water and sewer revenue bonds provided for herein; and WHEREAS, Seattle-Northwest Securities Corporation has offered to purchase those bonds under the terms and conditions hereinafter set forth; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON, DO ORDAIN, as follows : SECTION I . Definitions . As used in this ordinance, the following words shall have the following meanings : "Annual Debt Service" for the Bonds shall mean all the interest plus all principal which will mature or come due in any year . "Average Annual Debt Service" shall mean the sum of the � Annual Debt Service for the remaining years to the last scheduled maturity of the Bonds divided by the number of those years . "Bond Fund" shall mean that special fund of the City known as the 1990 Water and Sewer Revenue Bond Redemption Account - 5 - � � r • � ORDINANCE NO. 4294 , . created by this ordinarice as a sep�ra�e account in the Water and Sewer Revenue Parity Bond Fund for the payment of the principal of and interest on the Bonds . "Bond Registrar" shall mean the fiscal agencies of the State of Washington in Seattle, Washington, and New York, New York, as the same shall be designated from time to time. "Bonds" shall mean the $4, 100 , 000 par value City of Renton Water and Sewer Revenue Bonds, 1990, authorized to be issued by this ordinance. "City" shall mean the City of Renton, Washington, a duly organized and legally existing noncharter code city under the laws of the State of Washington. "Future Parity Bonds" shall mean all water and sewer revenue bonds of the City issued after the date of the issuance of the Bonds and having a lien and charge on the Revenue of the ' Waterworks Utility on a parity with the lien and charge on such Revenue for the payment of the principal of and interest on the Outstanding Parity Bonds and the Bonds . "Maintenance and Operation Expense" shall mean all expenses ' incurred by the City in causing the Waterworks Utility to be operated and maintained in good repair, working order and condition, which shall not include any depreciation expenses or taxes . or charges in lieu of taxes levied or imposed by the City. , "Outstanding Parity Bonds" shall mean the 1977 Bonds, Issue No . 3, the 1983 Bonds, the 1985 Bonds, the 1986 Bonds, the 1987 Bonds, the 1988 Bonds, the 1989 Bonds and the 1989 Refunding Bonds . - 6 - ' � I r � i ORDINANCE NO. 4294 , , "Principal and Iriterest Account" shall mean the subaccount of that name created in the Bond Fund by this ordinance for the payment of the principal of and interest on the Bonds . ' "Reserve Account" shall mean the subaccount of that name created in the Bond Fund by this ordinance for the purpose of securing the payment of the principal of and interest on the Bonds . "Revenue of the Waterworks Utility" shall mean all the earnings and revenue received by the Waterworks Utility from any source whatsoever, including payments received under contract with other municipal corporations for water service, except general taxes, charges in lieu of taxes, assessments in any utility local improvement district hereafter created, proceeds from the � sale of City property, bond proceeds and earnings subject to a federal tax or rebate requirement . "Term Bonds" shall mean those Bonds maturing in the year 2010 and any Outstanding Parity Bonds and/or Future Parity Bonds identified as such in the ordinance authorizing the issuance thereof, the payment of which is provided for by a requirement for mandatory deposits of money into the principal and interest account of the bond redemption fund created for the payment of such issue of bonds in accordance with a mandatory sinking fund requirement . "Water and Sewer Revenue Parity Bond Fund" shall mean the fund of that name created by Ordinance No. 3896 . � I � , � ORDINANCE NO. 4294 . . "Waterworks Utility Fund" shall mean that special fund of the City into which all of the Revenue of the Waterworks Utility (except for earnings in any special fund for the redemption of revenue obligations of the Waterworks Utility) shall be deposited. "Waterworks Utility" shall mean the combined water and sewerage systems, including the storm and surface water sewers, of the City as the same may be added to, improved and extended , for as long as any of the Outstanding Parity Bonds, the Bonds I and any Future Parity Bonds are outstanding. SECTION II . Adoption of Plan of Additions and Betterments . The City specifies, adopts and orders the carrying out of a system or plan of additions to and betterments and extensions of the Waterworks Utility consisting of the improvements, acquisitions and work described in Exhibit A attached hereto and by this reference made a part hereof . There shall be included in the foregoing system or plan the acquisition and installation of all necessary valves, pumps, fittings, couplings, connections, equipment and appurtenances, the acquisition of any easements, rights-of-way and land that may be required and the performance of such work as may be incidental thereto and necessary. All of the foregoing shall be in accordance with the plans and specifications therefor prepared by the City' s engineers and consulting engineers . - 8 - � ORDINANCE NO. 4294 � . The City Council may modify the details of the foregoing system or plan where, in its judgment, it appears advisable if such modifications do not substantially alter the purposes of that system or plan. The life of the improvements comprising the foregoing system or plan of additions to and betterments and extensions of the Waterworks Utility is declared to be at least twenty years . The estimated cost of the acquisition, construction, installation and financing of the above-described improvements, including the costs of issuance and sale of the Bonds, is declared to be approximately $6,027,900 . That cost shall be paid from the proceeds of the Bonds authorized in this ordinance, proceeds of grants anticipated to be received by the City and other money of or received by the City which is made available therefor . SECTION III . Findinqs Reqardinq Parity Provisions . The City Council finds that all payments required by Ordinances Nos . 3169, 3188, 3720, 3896, 3970, 4068, 4157, 4211 and 4232 for the Outstanding Parity Bonds have been made into the respective bond redemption funds and accounts therein for the Outstanding Parity Bonds, that provision hereinafter is made for the accumulation of the amounts required in the Reserve Account of the Bond Fund, and that there will be on file prior to the issuance and delivery of the Bonds a certificate of Richard H. Harbert of RH2 Engineering, P. S. , an engineer experienced in municipal utilities, that the Revenue of the Waterworks Utility - 9 - = II —-. � + I I , t s � ORDINANCE N0. 4294 � • � � is sufficient ta mee� the 1 .3 coverage requirement af those ard3nances . SECTION IV. Authorization of Bands and Acceptance of Bid. For the purpose af providing a part of the maney required to carry out the system or plan of additions ta and betterments and � extensions af the Waterworks Utility, including the cost af ' issuance and sale of the Bonds, as herein specified, adap�ed and ' ordered to be carried out, the City shall issue the Bonds in the � aggregate principal amoun� of $4 , 100,000 • SECTION V. Descrip�ion of Bonds . The Bands shall be designated City of Renton Wa�er and Sewer Revenue Bonds, 1990 (defined above as the "Bonds"} ; shall be dated Navember 1 , 1990; shall be in the denomination of $5,000 or any integral multiple thereof within. a single maturity; shall be numbered separately in the manner and with any additional designation as the Bond Registrar deems necessary £or the purpose of identifica�ian; and shall bear in�erest at the rates set forth below, computed on �he basis of a 360-day year of twelve 30-day months, payable on April l , 1991, and semiannually thereaf�er an each succeedin.g October 1 and April 1 . The Bonds shall bear interest a� the ra�es and mature an October 1 in years and amoun�s as follows: Maturity Interest Years Amounts Rates 1991 $ 105,Q00 5 .9QOo 1992 110,040 6 . OQ4 1993 115,f}00 6 . lOQ 1994 125,000 6 .250 1995 130 ,Q00 6 .350 1996 140, Q00 6 .450 - 14 - � � ORDINANCE N0. 4294 � . II Maturity Interest Years Amounts Rates 1997 150, 000 6 . 550 1998 160, 000 6 . 650 1999 175,000 6 . 750 2000 175, 000 6 . 900 2001 200,000 7 . 000 2002 200, 000 7 . 100 2003 220 , 000 7 . 200 � 2004 240, 000 7 .300 2005 255, 000 7 .350 ** *** ** 2010 1, 600, 000 7 .375 SECTION VI . Reqistration and Transfer of Bonds . The Bonds shall be issued only in registered form as to both principal and interest and 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 each Bond ancl the principal amount and number of each of the Bonds held by each owner . Bonds surrendered to the Bond Registrar may be exchanged for Bonds in any authorized denomination of an egual 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 . Any exchange or transfer shall be without cost to the owner or transferee. The Bond Registrar shall not be obligated to exchange or transfer any Bond during the fifteen days preceding any principal payment or redemption date. - 11 - ORDINANCE NO. 4294 • • SECTION VII . Payment of Bonds . Both principal of and interest on the Bonds shall be payable in lawful money of the United States of America. Interest on the Bonds shall be paid by checks or drafts mailed by the Bond Registrar on the interest payment date to the registered owners at the addresses appearing on the Bond Register on the fifteenth day of the month preceding the interest payment date. Principal of the Bonds shall be payable upon presentation and surrender of the Bonds by the registered owners at either of the principal offices of the Bond Registrar at the option of the owners . The Bonds shall be payable solely out of the Bond Fund and shall be a valid claim of the owners thereof only as against the Bond Fund and the amount of the Revenue of the Waterworks Utility pledged to that fund and shall not be general obligations of the City. SECTION VIII . Optional and Mandatory Redemption and Open Market Purchase of Bonds . Bonds maturing in the years 1991 through 2000, inclusive, shall be issued without the right or option of the City to redeem those Bonds prior to their stated maturity dates . The City reserves the right and option to redeem Bonds maturing on or after October 1, 2001, prior to their stated maturity dates from funds from any source on or after October 1, 2000 , as a whole at any time or in part on any interest payment date, by lot in such manner as the Bond Registrar shall determine within one or more maturities selected ' by the City at par plus accrued interest to the date fixed for redemption. - 12 - ORDINANCE NO. 4294 . „ Bonds maturing in the year 2010 are Term Bonds and, if not purchased in the open market or redeemed under the optional redemption provisions set forth above, shall be called for redemption by lot (in such manner as the Bond Registrar shall determine) at par plus accrued interest on October 1 in years and amounts as follows : Mandatory Mandatory Redemption Redemption Years Amounts 2006 $275, 000 2007 295, 000 2008 320,000 2009 340, 000 2010 370, 000 Term Bonds previously redeemed by optional call or open market purchase shall be credited to the principal amount of Term Bonds to be called on the latest scheduled mandatory redemption date. Portions of the principal amount of any Bond, in installments of $5,000 or any integral multiple thereof, may be � redeemed. If less than all of the principal amount of any Bond is redeemed, upon surrender of that Bond at either of the principal offices of the Bond Registrar, there shall be issued to the registered owner, without charge therefor, a new Bond (or Bonds at the option of the registered owner) of the same interest rate and maturity in any of the denominations authorized by this ordinance in the aggregate total principal amount remaining unredeemed. - 13 - ORDINANCE NO. 4294 ' • The City further reserves the right and option to purchase any or all of the Bonds in the open market at any time at a price not in excess of par plus accrued interest to the date of purchase. All Bonds purchased or redeemed under this section shall be cancelled. SECTION IX. Notice of Redemption. The City shall cause notice of any intended redemption of Bonds to be given not less than 30 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 at the time the Bond Registrar prepares the notice, and the requirements of this sentence shall be deemed to have been fulfilled when notice has been mailed as so provided, whether or not it is actually received by the owner of any Bond. Interest on Bonds called for redemption shall cease to accrue on the date fixed for redemption unless the Bond or Bonds called are not redeemed when presented pursuant to the call . In addition, the redemption notice shall be mailed within the same period, postage prepaid, to Moody' s Investors Service, Inc . , and Standard & Poor ' s Corporation at their offices in New York, New York, or their successors, to Seattle-Northwest Securities Corporation, at its principal office in Seattle, Washington, or its successor, and to such other persons and with such additional information as the City Finance Director shall - 14 - � I ORDINANCE NO. 4294 . , determine, but these additional mailings shall not be a condition precedent to the redemption of Bonds . SECTION X. Failure to Redeem Bonds . If any Bond is not redeemed when properly presented at its maturity or call date, the City shall be obligated to pay interest on that Bond at the same rate provided in the Bond from and after its maturity or call date until that 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 by giving notice of that call to the registered owner of each of those unpaid Bonds . SECTION XI . Creation of Account and Subaccounts; Deposits into Accounts . There is created the 1990 Water and Sewer Revenue Bond Redemption Account (heretofore defined as the Bond Fund) which shall be a separate bond redemption account within the Water and Sewer Revenue Parity Bond Fund. The Bond Fund is divided into two subaccounts, the Principal and Interest Account and the Reserve Account . So long as Bonds are outstanding against the Bond Fund, the City Finance Director shall ; (a) Set aside and pay into the Principal and Interest ' Account out of the Revenue of the Waterworks Utility a fixed amount, without regard to any fixed proportion, namely, monthly, on or before the first day of each month, amounts, together with the accrued interest received on the delivery of the Bonds to the initial purchaser thereof or other money on deposit therein, as follows : Beginning with the month of November 1990, and continuing through March 1991 , 1/5th of the next ensuing five months ' requirements for interest on the Bonds; - 15 - QRDINANCE NO. 4294 � " Beginning with the month of Aprii I991 and cantinuing thereafter until the Bonds, both principal and interest, are paid, ljbth af the nex� ensuing six Fctonths ' requiremen�s for interest on the Bonds; Beginning with the month of November, 1990, and continuing through September 1991, 1/llth of the amount of principal of the Bonds payable on the next ensuing principal payment date; and Beginning with the month of October 1991, and continuing thereafter until the Bonds, both principal and interest, are paid, 1/12th of the amount of principal of the Bands payable, including any mandatory redemption reguirement, on the next ensuing principal payment ar mandatory redemptian date. {b} Set aside and pay into the Reserve Account out of the Revenue of the Waterworks Utility in substantially equal monthly payments such amounts so that by no later �han October 1, 1995, there shall have been accumulated in the Reserve Account for �he Bonds an amount not less than the Average Annual Debt Service for the Bonds . The Reserve Account in the Bond Fund may be accumulated from any ather money which the City may have available for that purpose in additian to or in lieu of using revenue therefor . The City fur�her agrees that when the required amoun�s have been paid intc� the Reserve Account in the Bond Fund, the City will maintain those amounts therein at all times, except for withclrawals therefrom as autharized herein, until there is sufficient money in the Band Fund, ineluding the Reserve Account � therein, to pay the principal af and interest ta maturity on all � outstanding Bands, at which �ime no further payments need be made in�o the Band Fund, and the money in the Bond Fund, including the Reserve Account, may be used to pay that principal and interest. � �, i — �s — I � ORDINANCE NO. 4294 ' • In the event there shall be a deficiency in the Principal and Interest Account to meet maturing installments of either principal or interest, as the case may be, on the Bonds, the deficiency shall be made up from the Reserve Account by the withdrawal of cash therefrom for that purpose. Any deficiency created in the Reserve Account by reason of any withdrawal shall then be made up from the Revenue of the Waterworks Utility first available after making necessary provisions for the required payments into the Principal and Interest Account . All money in the Reserve Account not needed to meet the payments of principal and interest when due may be kept on deposit in the official bank depository of the City or in any national bank or may be invested in any legal investment for City funds maturing not later than the interest or principal and interest payment date when the money will be needed. Interest on any of those investments or on that bank account shall be deposited in and become a part of the Reserve Account until the total required reserve amount shall have been accumulated therein, after which time the interest shall be deposited in the Principal and Interest Account . Notwithstanding the provisions for the deposit or I maintenance of earnings in accounts of the Bond Fund, any earnings which are subject to a federal tax or rebate requirement may be withdrawn from the Bond Fund for deposit into a separate fund or account for that purpose. - 17 - . ORDINANCE NO. 4294 ' 4 I f the City shal l f a i 1 to set as ide and pay into the Bond. Fund the amounts set forth above, the owner of any of the outstanding Bonds may bring an action against the City to compel that setting aside and payment . SECTION XII . Flow of Funds . Funds in the Waterworks Utility Fund (other than in any bond redemption or federal rebate account) shall be used in the following order of priority: (a) To pay Maintenance and Operation Expense; (b) To pay the interest on the Outstanding Parity II Bonds, the Bonds and any Future Parity Bonds; �'i (c) To pay the principal of the Outstanding Parity '' Bonds, the Bonds and any Future Parity Bonds; � ; (d) To make all payments required to be made into any sinking fund or bond redemption fund I hereafter created for the payment of Future � Parity Bonds which are Term Bonds; � (e) To make all payments required to be made into �i the reserve accounts created to secure the I payment of the Outstanding Parity Bonds, the Bonds and any Future Parity Bonds; � (f) To make all payments required to be made into ! any revenue bond redemption fund or warrant ' redemption fund and debt service account or ' reserve account created to pay and secure the �� payment of the principal of and interest on any �i revenue bonds or revenue warrants of the City � having a lien upon the Revenue of the Waterworks Utility junior and inferior to the lien thereon for the payment of the principal of and interest on the Outstanding Parity Bonds, the Bonds and any Future Parity Bonds; and (g) To retire by optional redemption or purchase in the open market any outstanding revenue bonds or revenue warrants of the City, to make necessary additions, betterments, improvements and repairs to or extensions and replacements of the Waterworks Utility or for any other lawful City purpose . - 18 - I ORDINANCE NO. 4294 • • 'i SECTION XIII . Pledqe of Revenue and Lien Position. The Revenue of the Waterworks Utility is pledged to the payments set forth in Section XI , and the Bonds shall constitute a lien and charge on that revenue prior and superior to any other charges whatsoever, excluding Maintenance and Operation Expense, except that the lien and charge on such revenue for the Bonds shall be on a parity with the lien and charge thereon for the Outstanding Parity Bonds and any Future Parity Bonds hereafter issued. SECTION XIV. Findinqs Reqardinq Sufficiency of Revenue. In the judgment of the City Council, the Revenue of the Waterworks Utility and benefits to be derived from the operation and maintenance of the Waterworks Utility, at the rates to be charged for water, sanitary sewage disposal service and storm and surface water drainage service in the entire utility, will be more than sufficient to meet all Maintenance and Operation Expense (and cost of maintenance and operation of the Waterworks Utility as that term is used in RCW 35 . 92 . 100) and the debt service requirements of the Outstanding Parity Bonds and to permit the setting aside in the Bond Fund, out of the revenue of the entire utility, of amounts sufficient to pay the interest on the Bonds as that interest becomes payable and to pay and redeem all of the Bonds at maturity. The City Council further declares that in creating the Bond Fund and in fixing the amounts to be paid into the same, as aforesaid, it has exercised due regard for the Maintenance and Operation Expense (and costs of maintenance and operation as used in RCW 35 . 92 . 100) and the debt ' - 19 - � � � � QRDINANCE NO, 4294 ' ' I service requirements of the presently outstanding tJutstanding Parity Bonds, and the City has nat bound and obligated itself to set aside and pay inta the Bond Fund a greater amount or � praportion of the revenue af that utility than in the judgment � af the Gity Council will be available over and above Main�enance I and Operation Expense (and such costs of maintenance and , aperation) and debt service requirements of the Outstanding I I Parity Bonds and that no partian of the Revenue of the Waterworks Utility has been previausly pledged £or any I unrefunded indebtedness other than the payrnent of the presently ' au�standing Outstanding Parity Bonds . SECTI4N XV. Cavenants . The City cavenan�s and agrees with the owner of each Bond at any time outstanding as follows : , {a) It will establish, maintain and collect such rates and charges far water, sanitary sewage disposal service and storm and surface water drainage service so lang as any Outstanding Parity Bonds and I Bonds are au�standing as wili make available for the � payment of the principal a� and interest on such 'I bands an amount eq�al to at least 1 .3 times the average annual debt service requirements, both principal and interest, on the Outstanding Parity Bonds and the Bands after deducting Maintenance and , Operation Expen.se £rom the Revenue af the Wa�erworks � U'�lllty. "Average annual debt servi.ce requirements" I shall mean the aggregate amoun� of principal and interest payable in each year over the rernaining life of such Outstanding Parity Bonds and Bonds divided by the number of maturity years remaining to the last I maturity of the longest maturing issue, being the I year 2009 . � (b) It will at alI times maintain and keep the air workin order and Waterwarks Utllzty in good rep , g condition and also will at all times operate such Utility and the business in cannection therewith in � an efficient rnanner and at a reasonable cast . � � � - 20 - I � ORDINANCE NO. 4294 ° . (c) It will not sell, lease, mortgage or in any manner encumber or dispose of all the property of the � Waterworks Utility unless provision is made for � payment into each of the respective bond redemption funds or accounts for the Outstanding Parity Bonds and the Bond Fund of sums sufficient to pay, respectively, the principal of and interest on all Outstanding Parity Bonds and the Bonds at any time outstanding, and that it will not sell , lease, mortgage, or in any manner encumber or dispose of any part of the property of the Waterworks Utility that is used, useful and material to the operation thereof, unless provision is made for replacement thereof, or for payment into the respective bond redemption funds or accounts for the Outstanding Parity Bonds and the Bond Fund of the total amount of revenue received which shall not be less than an amount which shall bear the same ratio to the amount of the Outstanding Parity Bonds and Bonds, respectively, as the revenue available for debt service for such outstanding bonds for the twelve months preceding such sale, lease, encumbrance or disposal from the portion of the utility sold, leased, encumbered or disposed of bears to the revenue available for debt service for such bonds from the entire utility for the same period. Any such money so paid into such funds shall be used to retire such outstanding bonds at the earliest possible date. (d) It will while any of the Bonds remain outstanding keep proper and separate accounts and records in which complete and separate entries shall be made of all transactions relating to the Waterworks Utility, and it will furnish the original purchaser or purchasers of the Bonds or any subsequent owner or owners thereof at the written request of such owner or owners complete operating and income statements of such utility in reasonable detail issued in any calendar year not more than ninety days after the close of such calendar year, and it will grant any owner or owners of at least twenty-five percent of the outstanding Bonds the right at all reasonable times to inspect the entire Waterworks Utility and all records, accounts and data of the City relating thereto . Upon request of any owner of any of the Bonds, it also will furnish to such owner a copy of the most recently completed audit of the City' s accounts by the State Auditor of Washington. - 21 - ORDINANCE NO. 4294 ' • (e) It will not furnish water, sanitary sewage ', disposal service or storm and surface water drainage 'I service to any customer whatsoever free of charge and '� promptly will take legal action to enforce collection of all delinquent accounts . (f) It will carry the types of insurance on the Waterworks Utility properties in the amounts normally carried by private water and sewer companies engaged in the operation of water and sewerage systems, and the cost of such insurance shall be considered a part of operating and maintaining such utility. If, as, and when the United States of America or some agency thereof shall provide for war risk insurance, the City further agrees to take out and maintain such insurance on all or such portions of such utility on which such war risk insurance may be written in an amount or amounts to cover adequately the value thereof . (g) It will pay all Maintenance and Operation Expense and the debt service requirements for the Outstanding Parity Bonds and the outstanding Bonds, and otherwise meet the obligations of the City as herein set forth. (h) It will take all actions necessary to prevent interest on the Bonds from being included in gross income for federal income tax purposes, and it will neither take any action nor make or permit any use of proceeds of the Bonds or other funds of the City treated as proceeds of the Bonds at any time during the term of the Bonds which will cause interest on the Bonds to be included in gross income for federal income tax purposes . The City certif ies that it has not been notif ied 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 XVI . Form and Execution of Bonds . The Bonds shall be printed or lithographed on good bond paper in a form . consistent with the provisions of this ordinance and state law, shall be signed by the Mayor and City Clerk, either or both of 'I - 22 - ORDINANCE N0. 4294 ' • whose signatures may be manual or in facsimile, and the seal of the City or a facsimile reproduction thereof shall be impressed or printed thereon. Only Bonds bearing a Certificate of Authentication in the following form, manually signed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of this ordinance: CERTIFICRTE OF AUTHENTICATION This bond is one of the fully registered City of Renton, Washington, Water and Sewer Revenue Bonds, 1990, described in the Bond Ordinance. WASHINGTON STATE FISCAL AGENCY Bond Registrar By Authorized Officer The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered and are entitled to the benefits of this ordinance. If any officer whose facsimile signature appears on the Bonds ceases to be an officer of the City authorized to sign bonds before the Bonds bearing his or her facsimile signature are authenticated or delivered by the Bond Registrar or issued by the City, those Bonds nevertheless may be authenticated, delivered and issued 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 - 23 - ORDINANCE NO. 4294 , • II bonds. Any Bond also may be signed on behalf of the City by any li 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 I did not hold the required office on the date of issuance of the Bonds. , SECTION XVII . Bond Reqistrar . The Bond Registrar shall I keep, or cause to be kept, at its principal corporate trust ' office, sufficient books for the registration and transfer of the Bonds which shall be open to inspection by the City at all times . The Bond Registrar is authorized, on behalf of the City, to authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of the Bonds and this ordinance, to serve as the City' s paying agent for the Bonds and to carry out all of the Bond Registrar ' s powers and duties under this ordinance and City Ordinance No. 3755 establishing a system of registration for the City' s bonds and obligations . The Bond Registrar shall be responsible for its representations contained in the Bond Registrar ' s Certificate of Authentication on the Bonds . The Bond Registrar may become the owner of Bonds with the same rights it would have if it were not the Bond Registrar and, to the extent permitted by law, may act as depository for and permit any of its officers or directors to ' act as members of, or in any other capacity with respect to, any � committee formed to protect the rights of Bond owners . SECTION XVIII . Bonds Neqotiable. The Bonds shall be negotiable instruments to the extent provided by RCW 62A. 8-102 and 62A. 8-105 . - 24 - , �. , , , ORDINANCE NO. 4294 SECTION XIX. Advance Refundinq or Defeasance of Bonds . In the event the City shall issue advance refunding bonds pursuant to the laws of the State of Washington, or have money available from any other lawful source, to pay the principal of and interest on the Bonds or such portion thereof included in the refunding or defeasance plan as the same become due and payable and to refund or defease all such then outstanding Bonds and to pay the costs of refunding or defeasance, and shall have irrevocably set aside for and pledged to such payment, refunding or defeasance, money and/or direct obligations of the United States of America sufficient in amount, together with known earned income from the investment thereof, to make such payments and to accomplish the defeasance or refunding as scheduled (hereinafter called the "trust account" ) and shall make irrevocable provision for redemption of such Bonds, then in that case the Bonds shall be deemed defeased (hereinafter collectively called the "defeased Bonds" ) . Thereafter, all right and interest of the owners of the defeased Bonds in the covenants of this ordinance, in the Revenue of the Waterworks Utility and in funds and accounts obligated to the payment of such Bonds shall cease and become void, except such owners shall have the right to receive payment of the principal of and interest on the defeased Bonds from the trust account and, in the event the funds in the trust account are not available for such payment, shall have the residual right to receive payment of the principal of and interest on the defeased Bonds from the I - 25 - � w � � � r ORDINANCE NO. 4294 ' ' Revenue of the Waterworks Utility without any priority of lien or charge against such revenue or covenants with respect thereto except to be paid therefrom. After the establishing and full funding of the trust account, the City may then apply any money in any other fund or account established for the payment or redemption of the defeased Bonds to any lawful purposes as it shall determine, subject only to the rights of the owners of any other bonds then outstanding. In the event the refunding plan provides that the Bonds being refunded or the refunding bonds to be issued be secured by cash and/or direct obligations of the United States of America or other legal investments pending the prior redemption of those Bonds being refunded and if such refunding plan also provides that certain cash and/or direct obligations of the United States of America or other legal investments are pledged irrevocably for the prior redemption of those Bonds included in the refunding plan, then only the debt service on the Bonds which are not defeased Bonds and the refunding bonds, the payment of which is not so secured by the refunding plan, shall be included in the computation of coverage for issuance of Future Parity Bonds and the annual computation of coverage for determining compliance with the rate covenants . SECTION XX. Provision for Future Parity Bonds . The City reserves the right to issue Future Parity Bonds which will - 26 - . ' � • , � , t ORDINANCE NO. 4294 constitute a lien and charge on the Revenue of the Waterworks '� Utility on a parity with the Outstanding Parity Bonds and the Bonds if the conditions set forth in Section 13 of Ordinance No . 3188, as modified and strengthened by Section 12 of Ordinance No. 3720 , are met and complied with at the time of the issuance of those Future Parity Bonds, which sections are by this reference incorporated herein and made a part hereof and shall continue to be applicable even though the 1953 Bonds have been paid and retired. SECTION XXI . Small Governmental Issuer ArbitracTe Rebate Exemption and Desiqnation of Bonds as "Qualified Tax-Exempt Obliqations . " The City finds and declares that (a) it is a duly organized and existing governmental unit of the State of Washington and has general taxing power; (b) no Bond which is part of this issue of Bonds is a "private activity bond" within the meaning of Section 141 of the United States Internal Revenue Code of 1986, as amended (the "Code" ) ; (c) at least 95% of the net proceeds of the Bonds 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 f ace amount of all tax-exempt obligations (other than private activity bonds) 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 - 27 - , �., , . , ORDINANCE NO. 4294 . , calendar year in which the Bonds are issued is not reasonably expected to exceed $5, 000, 000; and (e) the amount of tax-exempt � obligations, including the Bonds, designated by the City as "qualified tax-exempt obligations" for the purposes of Section 265(b) (3) of the Code during the calendar year in which the Bonds are issued does not exceed $10 , 000, 000 . The City I� therefore certifies that the Bonds are eligible for the arbitrage rebate exemption under Section 148(f) (4) (C) of the Code and designates the Bonds as "qualified tax-exempt obligations" for the purposes of Section 265(b) (3) of the Code. SECTION �II . Deposit of Bond Proceeds . There has been created in the office of the City Finance Director a special fund of the City known and designated as the Water and Sewer Construction Fund, 1983 (the "Construction Fund" ) . The principal proceeds received from the issuance and sale of the Bonds shall be deposited in the Construction Fund and shall be used to pay the costs of carrying out the system or plan of additions to and betterments and extensions of the Waterworks Utility specified, adopted and ordered to be carried out by this � ordinance and the expenses incurred in the issuance of the �' Bonds . Pending the expenditure of the principal proceeds out of the Construction Fund, the money in that fund may be invested in �, any legal investment and the investment income may be retained � in that fund and used for the purposes of the fund. The accrued interest on the Bonds, if any, received at the time the Bonds are delivered to the Purchaser shall be deposited in the Bond Fund. - 28 - � , � , , � � ORDINANCE NO. 4294 ' ' SECTION �III . Approval of Boncl Purchase Contract and Preliminary Official Statement . Seattle Northwest Securities Corporation of Seattle, Washington, has presented a purchase contract (the "Bond Purchase Contract" ) to the City offering to purchase the Bonds under the terms and conditions provided in the Bond Purchase Contract, which written Bond Purchase Contract is on file with the City Clerk and is incorporated herein by this reference. The City Council finds that entering into the Bond Purchase Contract is in the City' s best interest and therefore accepts the offer contained therein and authorizes its execution by City officials . The Bonds will be printed at City expense and will be delivered to the purchaser in accordance with the Bond Purchase Contract, with the approving legal opinion of Foster Pepper & Shefelman, municipal bond counsel of Seattle, Washington, regarding the Bonds printed on each Bond. Bond counsel shall not be required to review and shall express no opinion concerning the completeness or accuracy of any official statement, offering circular or other sales material issued or used in connection with the Bonds, and bond counsel ' s opinion shall so state. The City Council has been provided with copies of a preliminary official statement dated October 30, 1990 (the "Preliminary Official Statement" ) , prepared in connection with the sale of the Bonds . For the sole purpose of the purchaser ' s - 29 - � , � . , , , , � , - • ORDINANCE N0. 4294 ` ' compliance with the Securities and Exchange Commission Rule 15c2-12(b) ( 1) , the City "deems final" that Preliminary Official Statement as of its date, except for the omission of information as to offering prices, interest rates, selling compensation, , aggregate principal amount, principal amount per maturity, maturity dates, delivery dates, ratings and other terms of the Bonds dependent on such matters . The proper City officials are authorized and directed to do everything necessary for the prompt execution and delivery of the Bonds to the purchaser, including the execution of the Official Statement on behalf of the City, and for the proper application and use of the proceeds thereof . SECTION �IV. Temporary Bond. Pending the printing, execution and delivery to the purchaser of definitive Bonds, the City may cause to be executed and delivered to the purchaser a single temporary Bond in the total principal amount of the Bonds . The temporary Bond shall bear the same date of issuance, interest rates, principal payment dates and terms and covenants as the definitive Bonds, shall be issued as a fully registered Bond in the name of the purchaser, and otherwise shall be in a form acceptable to the purchaser . The temporary Bond shall be ' exchanged for definitive Bonds as soon as they are printed, authenticated and available for delivery. - 30 - � -� , ' S , � • � ORDINANCE NO. 4294 ' • SECTION XXV. Effective Date of Ordinance. This _ordinance shall be effective upon its passage, approval a�:d,�`five -3ays after publication _ ;-� ` PASSED by the City Council this 5th day of N�v�mber, 1990 . , ` � - _ � /^ ��� .�����\�i/`r%' Marilyn , etersen, City Clerk I APPROVED BY THE MAYOR this 5 h day of November, 1990 . � Ea 1 Clymer, yor Approved as to Form: Date of Pu ication: No��ember 9, 1990 MLC-1156* - 31 - • � � � nf � � � • • EXHIBIT A Water System Construction and Rehabilitation of Wells Replacement/Installation Water Main and Transmission Lines Water Quality Investigation and Protection Pump Station Rehabilitation Reservoir Rehabilitation MLC-1156*