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HomeMy WebLinkAboutLimited Tax General Obligation Bonds - Transport & Utility Improvements - 2006Transcript of Proceedings
Relating to the Authorization, Sale, Issuance
and Delivery of the
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
Dated: August 1, 2006
Date of Issue: August 8, 2006
Bond Counsel
GOTTLIEB, FISHER & ANDREWS, PLLC
520 Pike Street, Suite 2510
Seattle, Washin~on 98101-4006
Phone (206) 654-!999
Fax (206) 654-8725
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
TABLE OF CONTENTS
DOCUMENT
Certificate re Transcript
Ordinance No. 5215 Authorizing the Sale and Issuance
of the Bonds
Minutes of City Council Meeting re
Ordinance No. 5215
Affidavit of Publication of Ordinance No. 5215
Bond Purchase Agreement
Letter of Representations
Disclosure and Debt Limit Certificate
Disclosure Certificate of Bond Insurer
Signature and No Litigation Certificate
Certificate re Authentication and Re~stration of Bonds
Specimen Bond
Specimen Insurance Policy
Certificate of Issuer as to MBIA Insurance Policy
Preliminary Official Statement
Official Statement
Rating Letters
Certificate of Delivery and Payment
Underwriter’s Receipt
Nonarbitrage and Tax Exemption Certificate
Tax Certificate of Bond Insurer
TAB NUMBER
1
2
4
5
6
7
8
9
10
11
!2
13
14
15
16
17
!8
19
20
f:\renton\ltgo 06 i
Underwriter’s Certificate
IRS Form 8038-G
Bond Report Form 101
Approving Opinion of Bofid Counsel
Opinion of Counsel to Bond Insurer
Closing Memorandum
21
22
23
24
25
26
f:\renton\ltgo 06 ii
CERTIFICATE AS TO TRANSCRIPT
I, MICHAEL E. BAILEY, the duly appointed, qualified and acting Finance and
Information Services Administrator of the City of Renton, Washington, DO HEREBY CERTIFY
that the attached transcript contains a tree and correct copy of all documents relating to the
authorization, sale, issuarice and delivery of the $17,980,000 CITY OF RENTON,
WASHINGTON, LIMITED TAX GENERAL OBLIGATION BONDS, 2006.
IN WITNESS WHEREOF, I have hereunto subscribed my official signature as of the 8th
day of August, 2006.
MICHAEL E. BAI.LEY
Finance and Information Services Administrator
City of Renton, Washington
f:q-enton\ltgo 06
CITY OF RENTON, WASHINGTON
ORDINANCE NO. 5215
AN ORDINANCE RELATING TO THE INCURRENCE OF
INDEBTEDNESS; PROVIDING FOR THE SALE AND
ISSUANCE OF LIMITED TAX GENERAL OBLIGATION
BONDS, 2006, IN THE AGGREGATE PRINCIPAL
AMOUNT OF $17,980,000 TO PROVIDE PART OF THE
COSTS OF CONSTRUCTING TRANSPORTATION AND
UTILITY INFRASTRUCTURE AND IMPROVEMENTS IN
THE CITY; PROVIDING FOR THE DATE,
DENOMINATIONS, FORM, TERMS, REGISTRATION
PRIVILEGES, MATURITIES, INTEREST RATES AND
COVENANTS OF THE BONDS; PROVIDING FOR THE
ANNUAL LEVY OF TAXES TO PAY THE PRINCIPAL
THEREOF AND THE INTEREST THEREON;
ESTABLISHING A DEBT SERVICE FUND FOR THE
BONDS; AND PROVIDING FOR THE SALE AND
DELIVERY OF SUCH BONDS TO D.A. DAVIDSON & CO.,
SEATTLE, WASHINGTON
.WHEREAS, the City of Renton (the "City") has determined that there is a need for
infrastructure and other improvements for the South Lake Washington Infrastructure project and
the SW 27th Street Extension project and it is in the best interest of the residents of the City. to
construct such roadway and-utility infrastructure improvements in the City;, and
WHEREAS, the City Council deems it to be in the best interest of the City that the City
borrow money and issue and sell obligations in the form of limited tax general obligation bonds
for the purpose of providing part of the costs of the Project (hereinafter defined); and
WHEREAS, the incurrence of indebtedness by the City to pay the costs of the Project
will not cause the total indebtedness of the City to be incurred without the assent of the voters of
the City to exceed the limitations set fort~,, in 3k~flt~’39..36 RCW; and
""4
"~ t;:;ii ::g ~’ "" *:I, the undersigned City Clerk of
~ O F-- ~ ;- ..: .City of Renton, Washington, certity
~c\°0~.:.’. ~* .."i:that this is a true and correct copy of
:- , -% ; :" : "g "5 ... Subs,ribed
--and s~_ led this 26 day 9f July,,,,, 2005......
City Clerk Bonnie
ORDINANCE NO. 5215
~,VftEREAS, D.A. Davidson & Co. (the "Purchaser") has offered, by way of the Bond
Purchase Agreement (the "Purchase Agreement"), to purchase such limited tax general
obligation bonds upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON, DO ORDAIN AS FOLLOWS:
Section I. Finding, Purpose and Description of Bonds. The City authorizes the sale and
issuance of its "Limited Tax General Obligation Bonds, 2006" (the "Bonds") for the purpose of
providing part of the funds necessary to pay the costs of constructing transportation and utility
infrastructure and improvements in the South Lake Washington Infrastructure project and the
SW 27th Street Extension project, and to pay certain "incidental costs and costs related to the sale
and issuance" (as defined in RCW 39.46.070) of the Bonds (the "Project").
The Bonds shall be in the aggregate principal amount of $17,980,000; shall be dated
August 1, 2006; shall be issued in fully registered form as to both principal and interest; shall be
in the denomination of $5,000 each or any integra! multiple thereof within a single maturity;
shall be numbered separately in such manner and with any additional designation as the fiscal
agencies of the State of Washington (the "State") located in Seattle, Washington and New York,
New York (collectively, the "Registrar"), may deem necessary for purpose of identification; shall
bear interest at the rates; and shall mature on December 1 in each of the years, in the principal
amounts, as set forth below:
ORDINANCE NO. 5215
Maturity Date Principal Interest Rate
(December 1)Amount Per Annum
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
$ 520,000 4.25%
540,000 4.25
565,000 3.90
585,000 4.25
610,000 5.00
640,000 4.50
670,OO0 5.25
700,000 5.25
750,000 4.30
775,000 5.00
2019"
2020
2021
2022
2023
2024
1,670,000 5.00
900,000 5.00
945,000 5.00
1,000,000 5.25
1,040,000 5.25
1,095,000 5.25
2028*4,975,0.00 5.00
*Term Bonds
The Bonds shall bear interest (computed on the basis of a 360-day year of twelve 30-day
months) from their date or from the most recent interest payment date to which interest has been
paid or duly provided for, whichever is later, payable on December 1, 2006, and semiannually
thereafter on June 1 and December 1 of each year to the maturity or earlier redemption thereof.
If any Bond is not paid upon proper presentment at its maturity or redemption date, the City shall
be obligated to pay interest at the same rate from and after such maturity or earlier redemption
until such Bond, both principal and interest, is paid in full.
The Bonds shall be negotiable instruments to the extent provided by RCW 62A.8-102
and RCW 62A.8-105.
On the date of issue of the Bonds, all Bonds maturing in the same maturity year shall be
issued in the form of a single certificate, which certificate shall be registered in the name of The
ORDINANCE NO. 5215
Depository Trust Company or any successor thereto engaged to operate a book-entry system for
recording the beneficial ownership of the Bonds, as Custodian (the "Custodian"), or its nominee,
and delivered to the Custodian. The Custodian shall hold each such Bond certificate in fully
immobilized form for ~ae benefit of the beneficial owners of the Bonds (the "Beneficial
Owners") pursuant to the Blanket Issuer Letter of Representations (the "Letter of
Representations"), from the City and the Registrar to the Custodian pertaining to the payment of
the Bonds and the book-entry system, until the earliest to occur of either (1) the date of maturity
of the Bonds evidenced by such certificate, at which time the Custodian shall surrender such
certificate to the Registrar for payment of the principal of and interest on such Bonds coming due
on such date, and the cancellation thereof; (2) the fifth business day following the date of receipt
by the Registrar of the City’s request to terminate the book-entry system of registering the
beneficial ownership of the Bonds (the "Book-Entry Termination Date"); or (3) the date the City
determines to utilize a new Custodian for the Bonds, at which time the old Custodian shall
(provided the City is not then in default of any payment then due on the outstanding Bonds)
surrender the immobilized certificates to the Registrar for transfer to the new Custodian and
cancellation as herein provided.
For so long as any outstanding Bonds are registered in the name of the Custodian or its
nominee and held by the Custodian in fully immobilized form as described in this Section II, the
rights of the Beneficial Owners shall be evidenced solely by an electronic and!or manual entry
made from time to time on the records established and maintained by the Custodian in
accordance with the Letter of Representations, and no certificates evidencing such Bonds shall
be issued and registered in the name of any Beneficial Owner or such Beneficial Owner’s
nominee.
ORDINANCE NO. 5215
The City may terminate, the "book-entry" system of registering ownership of the Bonds at
any time (provided the City is not then in default of any payment then due on the outstanding
Bonds) by delivering to the Registrar: (a) a written request that it issue and deliver Bond
certificates to each Beneficial Owner or such Beneficial Owner’s nominee on the Book-Entry
Termination Date; (b) a list identifying the Beneficial Owners as to both name and address; and
(c) a supply of Bond certificates, if necessary for such purpose. Upon surrender to the Registrar
of the immobilized certificates evidencing all of the then outstanding Bonds, the Registrar shall
issue and deliver new certificates to each Beneficial Owner or such Beneficial Owner’s duly
appointed agent, naming such Beneficial Owner or such Beneficial Owner’s nominee as the
registered owner (the "Owner") thereof. Such certificates may be in any integral multiple of
$5,000 within a single maturity. Following such issuance, the Owners of such Bonds may
transfer and exchange such Bonds in accordance with Section IX hereof.
Neither the City nor the Registrar shall have at any time any responsibility or liability to
any Beneficial Owner of any Bonds or to any other person for any error, omission, action or
failure to act on the part of the Custodian with respect to payment, when due, to the Beneficial
Owner of the principal and interest on the Bonds, proper recording of beneficial ownership of
Bonds, proper transfers of such beneficial ownership, or any notices to Beneficial Owners or any
other matter pertaining to the Bonds.
Section II. Place, Manner and Medium of Payment. Both the principal of and interest
on the Bonds shall be payable in lawful money of the United States of America. Prior to the
Book-Entry Termination Date, the principal and interest on the Bonds shall be paid by the
Registrar to the Custodian as the Owner thereof, for the benefit of the Beneficial Owners thereof,
in accordance with the Letter of Representations.
5
ORDINANCE NO. 5215
From and after the Book-Entry Termination Date, interest on the Bonds shall be paid by
check or draft mailed on or before the interest payment date, to the persons identified as the
Owners on the fifteenth day of the month preceding the interest payment date at the addresses
shown for the Owners on the registration books for the Bonds (the "Bond Register") maintained
by the Registrar; provided, however, that if so requested in writing by the Owner of at least
$1,000,000 principal amount of Bonds, interest will be paid by wire transfer on the interest
payment date to an account with a bank located in the United States. From and after the Book-
Entry Termination Date, principal of the Bonds shall be payable upon presentation and surrender
of the Bonds by the Owners at the principal corporate trust office of the Registrar.
Section III. Redemption; Open Market Purchase. The Bonds maturing on December 1,
2019 and 2028 are term bonds (the "Term Bonds") and, if not previously purchased by the City
in the open market or optionally redeemed as set forth below, are subject to mandatory sinking
fund redemption in part and by lot (in such manner as the Registrar shall determine), at par plus
accrued interest to the redemption date on December 1 in the following years and in the
following mandatory sinking fund redemption amounts:
Mandatory Sinking Fund
Redemption Dates
(December 1)
2018
2019"
2025
2026
2027
2028*
Mandatory Sinking Fund
Redemption Amounts
$815,000
855,000
1,155,000
1,210,000
1,275,000
1,335,000
*Scheduled maturity
ORDINANCE NO. 5215
The Bonds maturing on December 1 in the years 2008 through 2016, inclusive, shall not
be subject to redemption prior to maturity. The Bonds maturing on or after December 1, 2017
shall be subject to optional redemption prior to maturity beginning on December 1, 2016, in
whole or in part at any time (maturities to be selected by the City and by lot within a maturity in
such manner as the Registrar shall determine), at par plus accrued interest to the date of
redemption. If the City shall optionally redeem Term Bonds or purchase Term Bonds in the
open market, the par amount of the Term Bonds so redeemed or purchased (irrespective of their
actual redemption or purchase prices) shall be credited against one or more scheduled mandatory
redemption amounts for such Term Bonds (as allocated by the City) beginning not earlier than
60 days after the date of the optional redemption or purchase, and the City shall promptly notify
the Registrar in writing of the manner in which the credit for the Term Bonds so redeemed or
purchased has been allocated.
Any Bond in the principal amount of greater than $5,000 may be partially redeemed in
any integral multiple of $5,000. Prior to the Book-Entry Termination Date, the Bonds shall be
partially redeemed in accordance with the Letter of Representations. From and after the Book-
Entry Termination Date, in the event of a partial redemption of a Bond, upon surrender of such
Bond at the principal corporate trust office of the Registrar, a new Bond or Bonds (at the option
of the Owner) of the same maturity and interest rate and in the aggregate principal amount
remaining unredeemed shall be authenticated and delivered to the Owner, without charge to the
Owner for such partial redemption, in any denomination authorized by this Ordinance and
selected by the Owner.
Prior to the Book-Entry Termination Date, the Registrar shall give, or cause to be given,
notice of a call for redemption of any Bonds to the Custodian, as the Owner thereof, for the
ORDINANCE NO. 5215
benefit of the Beneficial Owners thereof, in accordance with the Letter of Representations. From
and after the Book-Entry Termination Date, notice of any such intended redemption shall be
given by or on behalf of the City not less than 30 nor more than 60 days prior to the date fixed
for redemption by first-c~lass mail, postage prepaid, to the Owner of each Bond to be redeemed at
the address appearing on the Bond Register on the day the notice is given. The requirements of
this section shall be deemed to be complied with when notice is mailed as herein provided,
whether or not it is actually received by the Owner. In addition, such redemption notice shall be
mailed within the same time period, postage prepaid, to each then existing nationally recognized
municipal securities information repository designated by the SEC ("NRMSIR"), to the State
Information Depository ("SID"), if one is created, and to MBIA Insurance Corporation (the
"Bond Insurer") or their respective successors, but such mailings shall not be a condition
precedent to the redemption of such Bonds.
If such notice to the Owners shall have been given and the City shall have set aside
sufficient money for the payment of all Bonds called for redemption on the date fixed for
redemption, the Bonds so called shall cease to accrue interest after such redemption date, and all
such Bonds shall be deemed not to be outstanding hereunder for any purpose, except that the
Owners of such Bonds shall be entitled to receive payment of the redemption price and interest
accrued on the principal of the Bonds to the redemption date from the money set aside for such
purpose.
The City reserves the right to purchase any or all of the Bonds on the open market at any
time and at any price.
All Bonds purchased or redeemed by the City shall be surrendered to the Registrar for
cancellation.
8
ORDINANCE NO. 5215
Section IV. Debt Limit Not Exceeded. The City finds and covenants that the Bonds are
issued within all constitutional and statutory debt limitations presently applicable to the City.
Section V. Pledge of Full Faith, Credit and Resources. The Bonds are limited tax
general obligations of the City. Unless the principal of and interest on the Bonds are paid from
other sources, so long as any Bonds are outstanding, the City hereby irrevocably covenants to
include in its budgets and to make annual levies of taxes within the constitutional and statutory
tax limitations provided by law without a vote of the qualified voters of the City upon all
property within the City subject to taxation in amounts which, together with any other money
legally available therefor, shall be sufficient to pay the principal and interest on the Bonds as the
same shall become due. The City hereby irrevocably pledges its full faith, credit and resources
to the annual levy and collection of such taxes and for the prompt payment of such principal and
interest. All of such taxes shall be paid into the Bond Fund hereinafter created.
Section VI. Form of Bonds. The Bonds shall be typewritten, printed or lithographed on
good bond paper in a form consistent with this Ordinance and State law.
Section VII. Execution of Bonds. The Bonds shall be signed on behalf of the City with
the facsimile or manual signatures of the Mayor and the City Clerk, and shall have the seal of the
City impressed or a facsimile thereof imprinted thereon.
In case either or both of the officers who shall have executed any Bond shall cease to be
such officer or officers of the City before the Bond so signed shall have been authenticated or
delivered by the Registrar or issued by the City, such Bond nevertheless may 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 also may be signed and attested on behalf of the City by such persons as at the actual
9
ORDINANCE NO. 5215
date of execution of such Bond shall be the proper officers of the City although at the original
date of such Bond such persons were not such officers of the City.
Section VIII. Authentication and Deliver,¢ of Bonds by Registrar. The Registrar is
authorized and directed, on behalf of the City, to authenticate and deliver Bonds initially issued
or transferred or exchanged in accordance with the provisions of such Bonds and this Ordinance.
Only such Bonds as shall bear thereon a "Certificate of Authentication" manually
executed by an authorized signatory of the Registrar shall be valid or obligatory for any purpose
or entitled to the benefits of this 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.
The Registrar shall be responsible for its representations contained in the Certificate of
Authentication on the Bonds.
Section IX. Registration: Transfer and Exchange. The Registrar shall keep, or cause to
be kept, the Bond Register at its principal corporate trust office.
The City and the Registrar, each in its discretion, may deem and treat the Owner of each
Bond as the absolute owner thereof for all purposes, and neither the City nor the Registrar shall
be affected by any notice to the contrary. Payment of any such Bond shall be made only as
described in Section II hereof, but such registration may be transferred as herein provided. All
such payments made as provided in Section II hereof shall be valid and shall satisfy and
discharge the liability of the City upon such Bond to the extent of the amount or amounts so
paid.
The registered ownership of any Bond may be transferred. Prior to the Book-Entry
Termination Date, the beneficial ownership of the Bonds may only be transferred on the records
10
ORDINANCE NO. 5215
established and maintained by the Custodian. On and after the Book-Entry Termination Date, no
transfer of any Bond shall be valid unless it is surrendered at any principal corporate trust office
of the Registrar, with the assignment form appearing on such Bond duly executed by the Owner
or such Owner’s duly authorized agent, in a manner satisfactory to the Registrar. Upon such
surrender, the Registrar shall cancel the surrendered Bond and shall authenticate and deliver,
without charge to the Owner or transferee therefor (other than governmental fees or taxes
payable on account of such transfer), a new Bond or Bonds (at the option of the new Owner), of
the same maturity and interest rate and for the same aggregate principal amount, in any
authorized denomination, naming as Owner the person or persons listed as the assignee on the
assignment form appearing on the surrendered Bond, in exchange for such surrendered and
cancelled Bond.
On and after the Book-Entry Termination Date, any Bond may be surrendered at the
principal corporate trust office of the Registrar and exchanged, without charge, for an equal
aggregate principal amount of Bonds; in any authorized denomination. The Registrar shall not
be obligated to transfer or exchange any Bond during the 15 days preceding any applicable
interest payment, principal payment or redemption date.
The Registrar may become the Owner of any Bond with the same rights it would have if
it were not the Registrar and, to the extent permitted by law, may act as depository for and permit
any of its officers or directors to act as a member of, or in any other capacity with respect to, any
committee formed to protect the rights of the Owners of the Bonds.
The City covenants that, until all Bonds shall have been surrendered and cancelled, it will
maintain a system of recording the ownership of each Bond that complies with the provisions of
the Internal Revenue Code of 1986, as amended (the "Code").
11
ORDINANCE NO. 5215
Section X. Mutilated, Lost. Stolen or Destroyed Bonds. If any Bond becomes mutilated,
lost, stolen or destroyed, the Registrar may authenticate and deliver a new Bond of the same
maturity and interest rate and of like tenor and effect in substitution therefor, all in accordance
with law. If such mutilated, lost, stolen or destroyed Bond has matured, the City at its option,
may pay the same without the surrender thereof. However, no such substitution or payment shall
be made unless and until the applicant shall furnish (a) evidence satisfactory to the Registrar of
the destruction or loss of the original Bond and of the ownership thereof, and (b) such additional
security, indemnity or evidence as may be required by or on behalf of the City. No substitute
Bond shall be furnished unless the applicant shall reimburse the City and the Registrar for their
respective expenses in the furnishing thereof. Any such substitute Bond so furnished shall be
equally and proportionately entitled to the security of this Ordinance with all other Bonds issued
hereunder.
Section XI. Defeasance. If money and/or "Government Obligations" (as such
obligations are defined in Chapter 39.53 RCW, as now in existence or hereafter amended)
maturing at such times(s) and bearing such interest to be earned thereon (without any
reinvestment thereof) as will provide a series of payments which shall be sufficient, together
with any money initially deposited, to provide for the payment of all of the principal of and
interest on all or a portion of the Bonds, when due in accordance with their terms in accordance
with a refunding plan adopted by the City, are set aside in a special fund (hereinafter called the
"trust account") to effect such payment and are pledged irrevocably for the purpose of effecting
such payment, then no further payments need be made into the Bond Fund for the payment of the
principal of and the interest on such Bonds, the Owners thereof shall cease to be entitled to any
lien, benefit or security of this Ordinance except for the right to receive the money and the
12
ORDINANCE NO. 5215
principal and interest proceeds on the obligations set aside in the trust account, and such Bonds
shall no longer be deemed to be outstanding hereunder.
Section XII. Sale of the Bonds: Delivery. The Purchaser has presented a bond purchase
agreemem (the "Purchase Agreement") to the City pursuant to which the Purchaser has offered
to purchase the Bonds, under the terms and conditions provided in the Purchase Agreement,
which written Purchase Agreement is on file with the City Clerk and is incorporated herein by
this reference. The City Council finds that entering into the Purchase Agreement is in the City’s
best interest and therefore accepts the offer contained in the Purchase Agreement and authorizes
the execution of the Purchase Agreement by the Mayor, her designee, the Chief Administrative
Officer of the City or the Finance and Information Services Administrator.
The Bonds will be prepared at City expense and will be delivered to the Purchaser in
accordance with the terms of the Purchase Agreement with the approving legal opinion of
Gottlieb, Fisher & Andrews, PLLC, bond counsel, Seattle, Washington, relative to the issuance
of the Bonds, printed on or attached to each Bond. Bond counsel has not been engaged to
participate in the preparation or review of, or express any opinion concerning the completeness
or accuracy of, any official statement or other disclosure documentation used in connection with
the offer or sale of the Bonds by any person, and bond counsel’s opinion shall so state. Bond
counsel has not been retained to monitor, and shall not be responsible for monitoring, the City’s
compliance with any federal law or regulations to maintain the tax-exempt status of the interest
on the Bonds.
Section XIII. DelivelW of Bonds: Temporary_ Bonds. The proper City officials,
including, but not limited to, the City Finance and Information Services Administrator, are
authorized and directed to execute and/or approve, as appropriate, all documents, including but
13
ORDINANCE NO. 5215
not limited to, the final Official Statement pertaining to the Bonds and the commitment from the
Bond Insurer for the issuance of an insurance policy for the Bonds, and to do everything
necessary for the preparation and delivery of a transcript of proceedings pertaining to the Bonds,
and the printing, execution and prompt delivery of the Bonds to the Purchaser and for the proper
application and use of the proceeds of the sale thereof.
If definitive Bonds are not ready for delivery by the date established for closing (the
"Closing"), the City Finance and Information Services Administrator, upon the approval of the
Purchaser, may cause to be issued and delivered to the Purchaser one or more temporary Bonds
with appropriate omissions, changes and additions. Any temporary Bond or Bonds shall be
entitled and subject to the same benefits and provisions of this Ordinance with respect to the
payment, security and obligation thereof as definitive Bonds authorized hereby. Such temporary
Bond or Bonds shall be exchangeable without cost to the Owners thereof for definitive Bonds
when the latter are ready for delivery.
Section X_IV. Establishment of Bond Fund; Application of Bond Proceeds. There is
hereby created and established in the office of the City Finance and Information Services
Administrator a special fund to be designated as the "Limited Tax General Obligation Bond
Fund, 2006" (the "Bond Fund").
The accrued interest on the Bonds, if any, received by the City upon the sale of the Bonds
shall be deposited into the Bond Fund and shall be applied to the payment of interest coming due
on the Bonds.
The remaining proceeds of the sale of the Bonds, less the underwriter’s discount and plus
the net original issue premium, shall be deposited, upon receipt, to the "South Lake Washington
14
ORDINANCE NO. 5215
Infrastructure Project Fund" (the "Project Fund"), established in the office of the City Finance
and Information Services Administrator, to pay part of the costs of the Project.
Except as provided by the Code and Section XV of this Ordinance, the interest and
profits derived from the investment of Bond proceeds shall be deposited in the Project Fund and
applied as described in the preceding paragraph.
Except as provided by the Code and Section XV of this Ordinance, if any money
allocable to the Bond proceeds remains in the Project Fund after payment of all the costs of the
Project or after termination of the Project by the City, such money shall be transferred to the
Bond Fund and applied to the payment of the principal of and interest on the Bonds.
Pending application as described in this Section XIV and subject to the requirements of
the Code and Section XV of this Ordinance, money allocable to the Bond proceeds in the Project
Fund may be temporarily deposited in such institutions or invested in such investments as may
be lawful for the investment of City funds.
Section XV. Tax-Exemption Covenants. The City covenants that it will not take or
permit to be taken on its behalf any action that would adversely affect the exclusion of the
interest on the Bonds from the gross income for purposes of federal income taxation, and will
take or require to be taken such acts as may be permitted by Washington law and as may from
time to time be required under applicable law to continue the exclusion of the interest on the
Bonds from the gross income for purposes of federal income taxation. Without limiting the
generality of the foregoing, the City will not invest or make or permit any use of the proceeds of
the Bonds or of its other money at any time during the term of the Bonds which would cause the
Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code.
15
ORDINANCE NO. 5215
The City covenants that it shall calculate or cause to be calculated, and shall rebate to the
United States, all earnings from the investment of Bond proceeds that are in excess of the
amount that would have been earned had the yield on such investments been equal to the yield
on the Bonds, plus income derived from such excess earnings, to the extent and in the manner
required by Section 148 of the Code.
The City has not been notified of any listing or proposed listing by the Internal Revenue
Service to the effect that the City is a bond issuer the arbitrage certifications of which may not be
relied upon.
The City will take no actions and will make no use of the proceeds of the Bonds or any
other funds held under this Ordinance which would cause any Bond to be treated as a "private
activity bond" (as defined in Section 141(b) of the Code) subject to treatment under said
Section 141(b) as an obligation not described in Section 103(a) of the Code, unless the tax
exemption thereof is not affected. :
Section XVI. Preliminar~ Official Statement Declaration. The City has been provided
with copies of a preliminary official statement dated July 5, 2006, (the "Preliminary Official
Statement"), prepared in connection with the sale of the Bonds. For the sole purpose of the
Purchaser’s compliance with Securities and Exchange Commission Rule 15c2-12(b)(1), the City
"deems fmaF’ the Preliminary Official Statement, as of its date, except for the omission of
information on offering prices, interest rates, selling compensation, delivery dates, ratings, other
terms of the Bonds dependent on such matters.
Section XVII. Undertaking to Provide Continuing Disclosure. This section constitutes
the City’s written undertaking for the benefit of the Owners and Beneficial Owners of the Bonds
16
ORDINANCE NO. 5215
required by subsection (b)(5)(i) of the Rule 15c2-12 (the "Rule") of the United States Securities
and Exchange Commission (the "SEC").
The City hereby agrees to provide or cause to be provided to each then existing
NRMSIR, to the SID, if one is created, and to the Bond Insurer the following annual financial
information and operating data (collectively, the "Annual Financial Information") for each prior
fiscal year, commencing with the fiscal year ending December 31, 2006, on or before the last day
of the seventh month following the end of such prior fiscal year:
(a) Annual financial statements prepared in accordance with the generally
accepted accounting principles applicable to governmental units, as such principles may
be changed from time to time and as permitted by State law; which statements will not be
audited, except that if and when audited financial statements are otherwise prepared and
available to the City, they will be provided (the "Annual Financial Statements");
(b)The assessed valuation of taxable property in the City;,
(c)Ad valorern taxes due and the percentages of taxes collected;
(d)Property tax levy rates per $1,000 assessed valuation;
(e)A statement of authorized, issued and outstanding general obligation
indebtedness of the City; and
(f) A narrative explanation of the reasons for any amendments to this
Section XVII made during the previous fiscal year and the impact of such amendments
on the Annual Financial Information being provided.
In its provision of such financial information and operating data, the City may cross-
reference to any "final official statement" (as defined in the Rule) available from the Municipal
17
ORDINANCE NO. 5215
Securities Rulemaking Board (the "MSRB") documents theretofore provided to each then
existing NRMSIR or the SID, if one is created, and to the Bond Insurer.
If not submitted as part of the Annual Financial Information, then when and if available,
the City shall provide its Annual Financial Statements, which shall have been audited by such
auditor as shall be then required or permitted by the State law, to each then existing NRMSIR, to
the SID, if one is created.
The City further agrees to provide or cause to be provided, in a timely manner, to the
SID, if one is created, and to either the MSRB or each then existing NRMSIR and to the Bond
Insurer, notice of any of the following events with respect to the Bonds, if material:
4.
difficulties;
5.
6.
Bonds;
7.
8.
9.
10.
and
Principal and interest payment delinquencies;
Non-payment related defaults;
Unscheduled difficulties;
Unscheduled draws on credit enhancements reflecting financial
Substitution of credit or liquidity providers, or their failure to perform;
Adverse tax opinions or events affecting the tax-exempt status of the
Modification to rights of the Owners of the Bonds;
Optional redemptions of the Bonds;
Defeasances of the Bonds;
Release, substitution or sale of property securing repayment of the Bonds;
11. Rating changes.
The City also agrees to provide or cause to be provided, in a timely manner, to the SID, if
one is created, and to either the MSRB or each then existing NRMSIR, notice of its failure to
18
ORDINANCE NO. 5215
provide the Annual Financial Information for the prior fiscal year on or before the last day of the
seventh month following the end of such prior fiscal year.
After the issuance of the Bonds, so long as the interests of the Owners or Beneficial
Owners of the Bonds will not be materially impaired thereby, as determined by a party
unaffiliated with the City (including, without limitation, a trustee for the Owners, nationally
recognized bond counsel or other counsel familiar with the federal securities law), or pursuant to
a favorable ’°no-action letter" issued by the SEC, this Section XVII may only be amended in
connection with any change in legal requirements, change in law, or change in the identity,
nature or status of the obligated person, or type of business conducted, and only in such a manner
that the undertaking of the City, as so amended, would have complied with the requirements of
the Rule at the time of the primary offering, after taking into account any amendments or
interpretations of the Rule, as well as any change in circumstances.
The City’s obligations to provide Annual Financial Information and notices of certain
events shall terminate without amendment upon the defeasance, prior redemption or payment in
full of all of the then outstanding Bonds. This Section XVII or any provision hereof, shall be
null and void if the City (i) obtains an opinion of nationally recog~aized bond counsel or other
counsel familiar with the federal securities laws to the effect that those portions of the Rule
which require this Section XVII or any such pro.vision are invalid, have been repealed
retroactively or otherwise do not apply to the Bonds; and (ii) notifies and provides the SID, if
any, and either the MSRB or each then existing NRMS[R with copies of such opinion.
The right of each Owner or Beneficial Owner of Bonds to enforce the provisions of this
Section XVII shall be limited to the right to obtain specific enforcement of the City’s obligations
19
ORDINANCE NO. 5215
under this Section XVII, and any failure by the City to comply with the provisions of this
undertaking shall not be a default with respect to the Bonds under this Ordinance.
The City Finance and Information Services Administrator is authorized and directed to
take such further action on behalf of the City as may be necessary, appropriate or convenient to
carry out the requirements of this Section XVII.
Section XVIII. Contract: Severabilitv. The covenants contained in this Ordinance shall
constitute a contract between the City and the Owners of each and every Bond. The City
unconditionally covenants that it will keep and perform all of the covenants of the Bonds and this
Ordinance. If any one or more of the provisions of this Ordinance shall be declared
unconstitutional or invalid for any reason, such decision shall not affect the validity of the
remaining provisions of this Ordinance or the Bonds, and this Ordinance and the Bonds shall be
construed and enforced as if such unconstitutional or invalid provision had not been contained
herein.
20
ORDINANCE NO. 5215
Section XIX. Effective Date. This Ordinance shall take effect and be in force five days
from and after its passage and publication as provided by law.
PASSED BY THE CITY COUNCIL this 17th day of July, 2006.
Bonnie I. Walton, City Clerk
APPROVED BY THE MAYOR this 17 ~ h day of J u 1 y ........2006.
Mayor
Approved as to form:
Date of Publication: 7/2!/2(305 (summary)
21
July !7, 2006
Monday, 7 p.m.
RENTON CITY COUNCIL
Regular Meeting
MINUTES
Council Chambers
Renton City Hall
CALL TO ORDER
ROLL CALL OF
COUNCILMEMBERS
CITY STAFF IN
ATTENDANCE
SPECIAL PRESENTATION
Library: New Director (Bette
Anderson)
Community Services: "Damn
Yankees" Teen Musical
Performance Excerpts
ADMINISTRATIVE
REPORT
Mayor Kathy Keolker called the meeting of the Renton City Council to order
and led the Pledge of Allegiance to the flag.
RANDY CORMAN, Council President; TONI NELSON; DAN CLAWSON;
DENIS LAW; TERRI BRIERE; MARCIE PALMER; DON PERSSON.
KATHY KEOLKER, Mayor; JAY COVINGTON, Chief Administrative
Officer; ZANETTA FONTES, Assistant City Attorney; BONNIE WALTON,
City Clerk; PETER HAHN, Deputy Planning/Building/Public Works
Administrator - Transportation; TERRY HIGASHIYAMA, Community
Services Administrator; BETTE ANDERSON, Library Director; VINCENT
ORDUNA, Cultural Arts Coordinator; ALEX PIETSCH, Economic
Development Administrator; MICHAEL BAILEY, Finance and Information
Services Administrator; MARTY WINE, Assistant CAO; COMMANDER
KENT CURRY, Police Department.
Community Services Administrator Terry Higashiyama introduced Bette
Anderson, the new Library Director. Ms. Anderson stated that she is looking
forward to working with everyone and to working on the Library Master Plan.
Continuing, Ms. Higashiyama introduced Cultural Arts Coordinator Vincent
Orduna who announced that Renton’s annual 2006 summer teen musical,
"Damn Yankees," will run from July 21 to August 13 at Carco Theatre. He
introduced performers Joshua Paul Moore, Monica Taylor, Kathryn Stewart,
Steven Hudson, Brad Walker, Thomas Webber, and Lee Morris who entertaine(
the audience with two sample numbers from the show.
Chief Administrative Officer Jay Covington reviewed a written administrative
report summarizing the City’s recent progress towards goals and work prograrm
adopted as part of its business plan for 2006 and beyond. Items noted included:
÷ "Celebrate the Heart of Renton" at IKEA Renton River Days, a family
festival celebrating pride in the community July 18 through July 23.
÷ Over 700 kids, parents, and friends attended the T-Ball and Coach Pitch
Jamboree on July 13. This summer’s program has 12 Coach Pitch teams
and 16 T-Ball teams.
Streets: Park Ave N Closure,
South Lake Washington
Roadway Improvements
Peter Hahn, Deputy Planning/Building/Public Works Administrator -
Transportation, reported on the temporary closure of Park Ave. N. (N. 6th St. to
Garden Ave. N.), for the South Lake Washington roadway and utility
improvements, and described the Garden Ave. N. detour route. He indicated
that the closure may be postponed until after the Renton River Days festival,
which will be held this week. In response to Council inquiries, Mr. Hahn stated
that Park Ave. N. could be closed for as long as 14 months. He assured that
affected business owners were notified of the street closure.
AUDIENCE COMMENT
Citizen Comment: DeMastus -
Highlands Community
Association
CERTIFICATE
I, the undersigned City Clerk of the
City of Renton, Washington, certify
th,t this is a true and correct copy ofSubscribed .. <’.. ") -. .:’.-andsealed this31 da of .,d-’ulv , 20 O{o . ’%"-~ " .-",
Sandel DeMastus, Highlands Community Association Vice President, PO Box
2041, Renton, 98056, expressed her thanks for those who have supported the
Highlands Community Association and her disappoinmaent with those she feels
have behaved inappropriately. Noting the importance of keeping all
July 17, 2006 Renton City Council Minutes Page 246
Citizen Comment: Petersen -
Various
Citizen Comment: Gaunt-
Smith - Resident Involvement
in City Planning
Citizen Comment: Maxwell -
Renton School Board, New
Director Introduction
Citizen Comment: Breeden -
Wonderland Estates Mobile
Home Park
Citizen Comment: Hale - The
Landing Project
Citizen Comment: Blayden -
The Landing Project
Citizen Comment: Johnson -
Various
communications open and of not discriminating against any one group or
individua!, Ms. DeMastus expressed her hope that the City and the Highlands
can mend relations.
Inez Somerville Petersen, PO Box 2041, Renton, 98056, spoke on the subject of
The Landing development, stating that it does not matter who is funding the
environmental appeal, but rather if the appeal is valid. Referring to the consent
agenda item concerning the contract with Doug Levy for legislative consulting
services, Ms. Petersen protested the expenditure. On another topic, she
suggested that the Planning Commission agenda and agenda packets remain on
the City’s web site for a longer period of time. Additionally, she suggested that
instead of redoing the City’s web site, that the money be used to add streaming
video to the current web site.
Shirley Gaunt-Smith, 4102 NE 6th Pl., Renton, 98059, expressed her concern
regarding elected officials’ lack of response to Renton citizens. Pointing out
that several complex proposed actions are occurring at the same time, she
stressed the importance of involving the community in the decision making so
that citizens feel a part of and have some ownership in the plans. She stated that
the proposals will greatly affect residents, and noted that plans will more likely
succeed if residents are involved.
Marcie Maxwell, PO Box 2048, Renton, 98056, speaking as a Renton School
District Board Director, introduced Todd Franceschina, the newest school board
director. She stated that Mr. Franceschina is a Renton High School graduate,
and has a lot of experience in finance and business administration to bring to the
board. Mr. Franceschina expressed his excitement about the position.
Raymond Arthur Breeden, Sr., 15279 Maple Dr., Renton, 98058, stated that
residents of the Wonderland Estates mobile home park located at Maple Valley
Hwy. and 149th Ave. SE want to be annexed to Renton. He explained that if
the property, which is zoned R-12 in King County, is bought by a developer,
every resident could be evicted. Mr. Breeden indicated that the residents are
working on a business plan to become a co-op, and asked that the City rezone
the property.
Mayor Keotker reported that she received three letters pertaining to this topic,
including one from Mr. Breeden. She explained that the Administration is
recommending that the matter be reviewed as part of the Comprehensive Plan
amendment process. (See page 247 for consent agenda item.)
Dave Hale, PO Box 3517, Renton, 98056, thanked the City for its work to bring
The Landing shopping center to this area. As a realtor, Mr. Hale indicated that
his clients have shown a positive interest in the development. He acknowledged
the opposition and roadblocks the development faces, and encouraged the City
to continue to move forward with the project.
Bob Blayden, 2533 Ilwac0 Ave. NE, Renton, 98059, praised the City for its
support of The Landing project, noting that it is a key part of Renton’s future.
He pointed out the need to develop the area in a way that produces the best
economic value for the.City.
Mayor Keolker stated that the Administration and Council is committed to the
project.
Arland "Buzz" Johnson, 334 Wells Ave. S., #306, Renton, 98057, praised the
Mayor’s Planting Day that occurred in April, saying that he enjoyed helping to
plant the trees. Pointing out a safety problem on the Cedar River Trail, Mr.
July 17, 2006 Renton City Council Minutes Page 247
CONSENT AGENDA
Council Meeting Minutes of~
7/10/2006
Appointment: Municipal Arts
Commission
CAG: 06-108, Maplewood
Golf Course Driving Range
Netting, NETServices
City Clerk: Quarterly Contract
List, 4/t/2006 to 6/30/2006
Appeal: Defoor Short Plat,
Terry Defoor, SHP-05-089
Appeal: Provost Variances,
Alan & Cynthia Provost, V-06-
024
Comprehensive Plan: 2006
Amendments
EDNSP: Legislative
Consulting Services, Doug
Levy
EDNSP: S Lake WA
Infrastructure Improvement
Project Grant, Economic
Development Administration
Annexation: Maplewood
Addition, Maple Valley Hwy
Johnson stated that bikers fail to dismount their bikes when they cross the
bridge by the Renton Senior Activity Center. On another subject, he thanked
Council for its support of the senior center, and conveyed how much he enjoys
the center’s planned hikes.
Items on the consent agenda are adopted by one motion which follows the
listing.
Approval of Council meeting minutes of 7/10/2006. Council concur.
Mayor Keolker appointed Evelyn Reingold, 833 SW Sunset Blvd., L-56,
Renton, 98055, to the Municipal Arts Commission to fill the unexpired term of
Edythe Gandy, who has resigned (term to expire 12/31/2006). Refer to
Community Services Committee.
City Clerk reported bid opening on 6/30/2006 for CAG-06-108, Maplewood
Golf Course Driving Range Netting Replacement; three bids; engineer’s
estimate $100,000 - $110,000; and submitted staff recommendation to award
the contract to low bidder, NETServices, LLC, in the amount of $135,449.81.
Council concur.
City Clerk submitted Quarterly Contract List for period of 4/1/2006 to
6/30/2006; 51 contracts and 20 addenda totaling $9,108,034.81. Information.
City Clerk reported appeal of Hearing Examiner’s decision regarding the Defoor
Short Plat; appeal filed on 6/22/2006 by Terry Defoor, represented by Karen
Orehoski, Ricci Grube Aita, PLLC, 1601 2nd Ave., Suite 1080, Seattle, 98112,
accompanied by required fee. The appeal packet includes one additional letter
received as allowed by City Code. Refer to Plannin~ and Development
Committee.
City Clerk reported appeal of Hearing Examiner’s decision regarding the
Provost variances application; appeal filed on 6/30/2006 by Alan and Cynthia
Provost, PO Box 1492, Renton, 98057, accompanied by required fee. Refer to
Planning and Development Committee.
Economic Development, Neighborhoods and Strategic Planning Department
requested approval of a one-time exception to the December 15 filing deadline
for two additional City-initiated 2006 Comprehensive Plan amendments, and
referral of the amendments to the Planning and Development Committee and
Planning Commission.
Economic Development, Neighborhoods and Strategic Planning Department
recommended approval of an ageement in the amount of $53,200 with Doug
Levy for legislative consulting services for 2006-2007. Council concur.
Economic Development, Neighborhoods and Strategic Planning Department
recommended approval of an a~eement with the U.S. Department of
Commerce Economic Development Administration for a $2,054,314 Financial
Assistance Award for the South Lake Washington Infrastructure Improvement
Project. Council concur.
Economic Development, Neighborhoods and Strategic Planning Department
recommended a public hearing be set on 8/7/2006 to consider the proposed
Maplewood Addition Annexation (located in the vicinity of Maple Valley
Hwy.) and associated zoning, for which the City,s requested boundary
expansion was approved by the Boundary Review Board (from 60.5 to 340
acres). Council concur.
July 17, 2006 Renton City Council Minutes Page 248
Annexation: Querin II,
Hoquiam Ave NE
Plat: Honey Creek View
Estates Preliminary Plat, NEe
Sunset Blvd, PP-05-118
Airport: Department of Natural
Resources Aquatic Lands
Lease
CAG: 06-039, Water Main
Replacement, VJM
Construction
Comprehensive Plan: 2006
Amendments
UNFINISHED BUSINESS
Planning: Highlands Area
Redevelopment
Economic Development, Neighborhoods and Strategic Planning Department
recommended a public hearing be set on 8/7/2006 for the proposed Querin II
Annexation (!ocated in the vicinity of Hoquiam Ave. NE and SE 112th St.) and
associated zoning, the boundaries of which were expanded by the Boundary
Review Board from 7.18 to 24 acres. Council concur.
Hearing Examiner recommended approval, with conditions, of the Honey Creek
View Estates Preliminary Plat; nine single-family lots on 1.8 acres located at
3524 NE Sunset Blvd. Council concur.
Transportation Systems Division requested approval to terminate the
Washington State Department of Natural Resources aquatic lands lease
agreement, and accept the new aquatic lands lease a~eement for the Will
Rogers-Wiley Post Memorial Seaplane Base at the Airport. Refer to
Transportation (Aviation) Committee.
Utility Systems Division submitted CAG-06-039, Water Main Replacement
Project - N. 31st, N. 33rd, and NE 24th Streets; and High Ave. NE; and
requested approval of the project, authorization for final pay estimate in the
amount of $1,360, commencement of 60-day lien period, and release of
retainage in the amount of $12,352.53 to VJM Construction Co., Inc.,
contractor, if all required releases are obtained. Council concur.
MOVED BY CORMAN, SECONDED BY NELSON, COUNCIL APPROVE
THE CONSENT AGENDA AS PRESENTED. CARRIED.
Mayor Keolker noted that one of the added proposed Comprehensive Plan
amendments, listed in the above consent agenda, concerns the Wonderland
Estates mobile home park property.
Council President Corman brought forward a proposal concerning the
Highlands area redevelopment. He explained that the City Council continues to
be committed to the revitalization of the Highlands community, especially the
subarea that has been the focus of the City’s attention most recently.
Mr. Corman recommended that additional Committee of the Whole meetings be
held, after any appeals regarding this matter have been resolved, to finalize a
rezoning of the Highlands Subarea that will meet the needs of current property
owners, while also providing new opportunities and encouragement for
developers to make an investment in this community. He also recommended
that the local residents be engaged in this planning process.
MOVED BY CORMAN, SECONDED BY LAW, THAT BECAUSE A GOOD
DEAL OF NEGATIVE ATTENTION HAS BEEN FOCUSED ON THE
STATE’S COMMUNITY RENEWAL ACT, PARTICULARLY THE
PORTION THAT ALLOWS FOR THE POTENTIAL USE OF EMINENT
DOMAIN, THE ADMINISTRATION:
CONTINUE WORKING WITH THE COMMLrNITY ON
DEVELOPMENT OPPORTUNITIES, THROUGH APPROPRIATE
REZONING OF THE AREA, WITHOUT THE USE OF THE
COMMUNITY RENEWAL ACT, OR EMINENT DOMAIN, TO
ACHIEVE THESE GOALS;
CONTINUE THE USE OF AN AGGRESSIVE CODE ENFORCEMENT
EFFORT TO TARGET THOSE PROPERTIES THAT VIOLATE CITY
CODE AND ARE A PUBLIC NUISANCE; AND
July 17, 2006 Renton City Council Minutes Page 249
Community Services
Committee
Appointment: Airport
Advisory Committee
Appointment: Municipal Arts
Commission
IMPLEMENT A POLICE ENFORCEMENT PLAN THAT WILL
RESULT IN REDUCING OVERALL CRIME PROBLEMS IN THE
COMMUNITY THAT HAVE BEEN IDENTIFIED BY THE
ADMINISTRATION.*
Councilwoman Briere questioned whether the intent is for the Planning and
Development Committee to continue the primary work on the zoning, which
also includes changes to the Comprehensive Plan.
Council President Corman confirmed that is still the intent. He explained that
he is trying to accomplish one major thing: codify the proposal that was made
by the Mayor at the 6/26/2006 Council meeting, taking the Community
Renewal Act off the table. Additionally, Mr. Corman stated that he wants to
convey to the community that the City will meet their challenge on the
enforcement of City Code violations.
Referring to Mr. Corman’s statement regarding finalizing a rezoning of the
Highlands Subarea that will meet the needs of current property owners,
Councilman Clawson pointed out that most of the Highlands Subarea residents
are not property owners, but renters, and they.should also be engaged in the
planning process. He expressed the need for replacing the low-income housing
that will be upgaded or eliminated due to the area’s upgade. He questioned
whether the Administration or City Attorney had any concerns regarding the
proposal.
Assistant City Attorney Zanetta Fontes pointed out that by taking the
Community Renewal Act off the table, some of the tools the City may have had
to help the residents are being taken away. Councilman Clawson stated that
taking this action does not prevent Council from considering using the
Community Renewal Act in the future.
Referring to the implementation of a police enforcement plan, Chief
Administrative Officer Jay Covington noted the need for a discussion with
Counci! regarding the allocation of resources. Council President Corman
indicated that when it is determined what is needed to address the issue, Council
will make the budget adjustments as required.
Council discussion ensued regarding affordable housing, density dynamics,
single-family and multi-family housing, the use of the space on a lot, and the
Center Village land use designation.
*MOTION CARRIED.
Community Services Committee Chair Nelson presented a report
recommending concurrence in the staff recommendation to approve Mayor
Keolker’s appointment of Frank Marshall to the Airport Advisory Committee as
Airport Leaseholders alternate representative for a term expiring on 5/7/2007.
MOVED BY NELSON, SECONDED BY PALMER, COUNCIL CONCUR IN
THE COMMITTEE REPORT. CARRIED.
Community Services Committee Chair Nelson presented a report
recommending concurrence in the staff recommendation to approve Mayor
Keolker’s appointment of Marie McPeak to the Municipal Arts Commission for
an unexpired term expiring 12/31/2006. MOVED BY NELSON, SECONDED
BY PALMER, COUNCIL CONCUR IN THE COMMITTEE REPORT.
CARRIED.
July 17, 2006 Renton City Council Minutes Page 250
Public Safety Committee
Community Services: Disaster
Relief Supply Building, Fire
District #25 & American Red
Cross
RESOLUTIONS AND
ORDINANCES
EDNSP: Annexation
Community Outreach, PRR
Contract, Budget Amend
Ordinance #5214
Vacation: Park Ave N, City of
Renton, VAC-04-005
Ordinance #5215
Finance: Bond Issuance, S
Lake WA Infrastructure & SW
27th St/Strander Blvd
Extension Projects
Public Safety Committee Chair Law presented a report recommending
concurrence in the staff recommendation to approve a joint ageement and
memorandum of understanding with King County Fire Protection District #25
and the American Red Cross, serving King and Kitsap Counties, to provide a
process for the American Red Cross to construct, equip, and maintain a disaster
relief supply building, funded by a grant from the Boeing Employees Fund, for
the purpose of housing local disaster relief supplies. The Committee
recommended that the Mayor and Citw Clerk be authorized to sign the
agreement and memorandum.*
Councilman Law pointed out that this is a great opportunity for Renton, as this
area of the County lacks such a facility. He stated that the building will be
located at Fire Station #16, and the City will not incur any of the costs.
*MOVED BY LAW, SECONDED BY NELSON, COUNCIL CONCUR IN
THE COMMITTEE REPORT. CARRIED.
The following ordinance was presented for first reading and referred to the
Council meeting of 8/7/2006 for second and final reading:
An ordinance was read amending the 2006 Budget by transferring funds in the
amount of $70,000 from the 2005 year-end fund balance for the purpose of
public information and community outreach efforts related to annexation and
incorporation, with $60,087 going to PRR, Inc. to conduct that work, and
declaring an emergency. MOVED BY BRIERE, SECONDED BY NELSON,
COUNCIL REFER THE ORDINANCE FOR SECOND AND FINAL
READING ON 8/7/2006. CARRIED.
The following ordinances were presented for second and final reading and
adoption:
An ordinance was read vacating four portions of right-of-way, a total of
approximately 21,795 square feet, along Park Ave. N. between N. 8th St. and
Logan Ave. N. for the proposed "The Landing" site development street system
(City of Renton; VAC-04-005). MOVED BY BRIERE, SECONDED BY
LAW, COUNCIL ADOPT THE ORDINANCE AS READ. ROLL CALL:
ALL AYES. CARRIED.
An ordinance was read relating to the incurrence of indebtedness; providing for
the sale and issuance of Limited Tax General Obligation Bonds, 2006, in the
aggregate principal amount of $17,980,000 to provide part of the costs of
constructing transportation and utility infrastructure and improvements in the
City; providing for the date, denominations, form, terms, registration privileges,
maturities, interest rates and covenants of the bonds; providing for the annual
levy of taxes to pay the principal thereof and the interest thereon; establishing a
debt service fund for the bonds; and providing for the sale and delivery of such
bonds to D.A. Davidson & Co., Seattle, Washington. MOVED BY
CLAWSON, SECONDED BY BRIERE, COUNCIL ADOPT THE
ORDINANCE AS READ.*
Finance and Information Services Administrator Michael Bailey introduced
Fred Eoff, Managing Underwriter with D.A. Davidson & Co., and Lindsay
Sovde, Financial Advisor with Seattle Northwest Securities, who both spoke on
the topic of the bond issuance. Mr. Eoffreported on the City’s bond credit
rating, pointing out that both credit rating services, Fitch Rating Services and
Standard and Poor’s, took a fresh look at the City’s economic status and
increased their credit ratings for the City from A+ to AA-. He noted that the
July 17, 2006 Renton City Council Minutes Page 251
NEW BUSINESS
Public Works: Neighborhood
Mail Box Stations
Finance: City Web Site
Update, City Logo
increased credit ratings resulted in an improvement to the bond insurance
premiums and interest rates.
Ms. Sovde stated that Seattle Northwest Securities worked as financial advisor
on the bond transaction. She indicated that the bond sale went very well, that
the bonds were priced fairly in the market, and that the fee charged by the
unde~vriter was fair.
*ROLL CALL: ALL AYES. MOTION CARRIED.
Chief Administrative Officer Jay Covington stated that the City’s credit rating
increase wilt result in savings to the taxpayers. Mayor Keolker noted that the
rating upgrade will positively affect how others view Renton as a place to
invest.
Council President Corman reported a discussion with a Maplewood Glen
neighborhood resident who informed him that the post office, instead of
delivering the mail to residents’ houses, is installing postal stations. He
conveyed that the resident is concerned about the placement of the postal
stations, as their placement may cause traffic flow and site distance problems,
and block parking and front yards. Pointing oiat that this is a widespread
problem, Mr. Corman asked that the Administration contact the post office to
try to become part of the planning process for the locating of postal stations.
Mayor Keolker said she will communicate the concerns to the post office.
Councilwoman Palmer reported that she and Councilmembers Briere and
Corman had an opportunity to preview the City’s new web site last week. She
pointed out that the web site looks great, is easy to use and navigate, and is easy
for staff to update. However, Ms. Palmer stated her surprise to see a new City
logo on the site. She pointed out that discussion occurred two years ago
regarding a new logo, and it was decided at the time, partially due to monetary
reasons, not to go forward with the effort.
MOVED BY PALMER, SECONDED BY PERSSON, COUNCIL STOP USE
OF THE NEW CITY LOGO AND REFER THE ITEM TO COMMITTEE OF
THE WHOLE.*
Discussion ensued regarding the logo on the new web site, and the City’s
existing logo. Councilwoman Briere explained that the logo was developed as
part of the web site, but noted that the City is not yet at the point of changing
the City logo. She discussed the opportunity the web site provided to start on a
path of updating the City logo at no cost to the City, the reason why she got
involved with the web site update project, the lack of a consistent design on
City publications, and the cost savings of having a consistent look.
Councilmembers Clawson, Law, Nelson, Persson, and Corman discussed the
importance of the City logo, and the need for Council review of a City logo
change. The comments pertained to the involvement of citizens in a City logo
redesign process, the costs associated with changing the logo, staying with the
existing logo or adding it to the new web site, the confusion about what is the
official City logo, the decision-making authority for logo changes, the lack of
notice regarding a new logo on the new web site, and making changes to the
new web site.
Mayor Keolker discussed the freshening of the look of the web site, the delay
this action will cause in the launching of the new web site, the changes that will
be necessary, and that the launch of the web site and the City logo are separate
issues.
July 17, 2006 Renton City Council Minutes Page 252
AUDIENCE COMMENT
Citizen Comment: McOmber-
Highlands Area
Redevelopment
Citizen Comment: Petersen -
City Web Site Update, City
Logo
Citizen Comment: DeMastus -
Eminent Domain Rally, Safety
Class
Citizen Comment: Breeden -
Wonderland Estates Mobile
Home Park
ADJOURNMENT
Recorder: Michele Neumann
July t7, 2006
*MOTION CARRIED. Councilman Clawson noted for the record that he
abstained from voting.
Howard McOmber, 475 Olympia Ave. NE, Renton, 98055, thanked Council for
its action concerning the Highlands area, particularly the abandonment of the
use of eminent domain. He stressed the importance of resident input on the
redevelopment effort.
Inez Somerville Petersen, Highlands Community Association Secretary, PO
Box 2041, Renton, 98056, thanked Council for its action concerning the
Highlands area. Additionally, Ms. Petersen indicated that changing the graphics
on the City’s new web site should not be difficult, and she expressed her support
for the City’s existing logo and the "ahead of the curve" logo.
Sandel DeMastus, Highlands Community Association Vice President, PO Box
2041, Renton, 98056, pointed out that a national rally against eminent domain
was held on June 23 and President Bush issued an Executive Order regarding
protecting the property rights of the American people. She also pointed out that
the Valley Communications Center (the regional 911 center) will be holding a
safety class.
Raymond Arthur Breeden, Sr., 15279 Maple Dr., Renton, 98058, stressed that
every resident of the Wonderland Estates mobile home park has a right to live in
peace, and to not worry about the park being sold.
MOVED BY PERSSON, SECONDED BY NELSON, COUNCIL ADJOURN.
CARRIED. Time: 9:06 p.m.
Bonnie I. Walton, CMC, City Clerk
RENTON CITY COUNCIL COMMITTEE MEETING CALENDAR
Office of the City Clerk
COUNCIL COMMITTEE MEETINGS SCHEDULED AT CITY COUNCIL MEETING
July 17, 2006
[COMMITTEE/CHAIRMAN
COMMITTEE OF THE WHOLE
(Corman)
DATE/TIME
MON., 7/24
MON., 7/31
AGENDA
CANCELLED
No Meeting (5th Monday)
MON., 8/07
5 p.m.
Integrated Emergency Management
Course Training Report;
Tri-Park Master Plan Update;
WSDOT’s Concurrence Plan
COMMUNITY SERVICES
(Nelson)
MON., 8/07
FINANCE MON., 8/07
(Persson)4:30 p.m.
CANCELLED
Vouchers
PLANNING & DEVELOPMENT
(Briere)
THURS., 7/20
3 p.m.
THURS., 8/03
3 p.m.
Colee Fence Issue (briefing only);
Visual Preference Survey for Downtown
Signage (briefing only)
Street Grid System
PUBLIC SAFETY
(Law)
MON., 8/07 CANCELLED
TRANSPORTATION (AVIATION)
(Palmer)
THURS., 7/20
2p.m.
THURS., 8/03
Department of Natural Resources Aquatic
Lands Lease Agreements;
Regional Transportation Issues Update
CANCELLED
UTILITIES THURS., 7/20
(Clawson)4 p.m.
THURS., 8/03
4 p.m.
Springbrook Creek Wetland & Habitat
Mitigation Bank Agreements
Springbrook Creek Wetland & Habitat
Mitigation Bank Agreements
NOTE:Committee of the Whole meetings are held in the Council Chambers unless otherwise noted. All other committee meetings are held in the Council
Conference Room unless otherwise noted.
STATE OF WASHINGTON, COUNTY OF KING}
AFFIDAVIT OF PUBLICATION
PUBLIC NOTICE
Jody L. Barton, being first duly sworn on oath that she is the Legal Advertising
Representative of the
King County Journal
a daily newspaper, which newspaper is a legal newspaper of general
circulation and is now and has been for more than six months prior to the date
of publication hereinafter referred to, published in the English language
continuously as a daily newspaper in King County, Washington. The King
County Journal has been approved as a Legal Newspaper by order of the
Superior Court of the State of Washington for King County.
The notice in the exact form annexed was published in regtdar issues of the
King County Journal (and not in supplement form) which was regularly
distributed to its subscribers during the below stated period. The annexed
notice, a
Public Notice
was published on July 21, 2006.
The full amount of the fee charged for said foregoing publication is the sum
of $126.00.
~12eg’~a Advertising Representative, King County Journal
Subscribed and sworn to me this 21~t day of July, 2006.
B D Cantelon
Notary Public for the State of Washington, Residing in Kent, Washington
PO Number:
CI2~/OF RENTON
NOTICE OF ORDINANCES
ADOPTED BY
RENTON CITY COUNCIL
Following is a summary of ordi-
nances adopted by the Renten City
Council on July 17, 2006:
ORDINANCE NO. 5214
An ordinance of the City of Renton,
Washiugton, vacating a portion of
Park Avenue N., between N. 8th St.
and Logan Avenue N., for tlm pro-
posed "The Landin(’ site develoIhnent
street system. (City of Renton; VAC-
04-005) Tim legal description is on file
at the City Clerk’s office, and is avail-
able upon request.
Effective: 7/26/2006
ORDINANCE NO. 5215
An ordinance of the City of Renton,
Washington, relating to the incur-
rence of indebtedness; providing for
tim sale and issuance of Limited Tax
General Obligation bonds, 2006, in the
aggregate principal anaount of
$17,980,000 to provide part of the
costs of constructing transportation
and utility infrastructure and
improvements in the City; providing
ibr the date, denominations, tbrm,
terms, registration p~vileges, maturi-
ties, interest rates and covenants of
the bonds; providing for the annual
levy of taxes to pay the principal
thereof and the interest flmreon;
establishing a debt service fund for
the bonds; and providing ibr the sale
and delivery of such bonds to D.A.
Davidson & Co., Seattle, Washington.
Etlhctive: 7/26/2006
Complete text of these ordinances is
available at Renton City Hall, 1055
South Grady Way; and posted at the
Renton Public Libraries, 100 Mill Ave-
nue South and 2902 NE 12th Street.
Upon request te the City Clerk’s
office, (425) 430-6510, copies wil! also
be mailed for a fee.
Bonnie I. Walton
City Clerk
Published in the King County Journal
July 21, 2006. #861099
CITY OF RENTON, WASHEN’GTON
LEVIITED TAX GENERAL OBLIGATION BONDS, 2006
BOND PURCHASE AGREEMENT
July 17, 2006
City of Renton
1055 S. Grady
Renton, WA 98058
On the date hereof, the City Council (the "Council") of the City of Renton (the "Issuer") adopted a bond
ordinance (the "Ordinance") authorizing the sale, issuance and delivery of the Issuer’s Limited Tax
General Obligation Bonds, 2006 (the "Bonds"), and the Issuer’s execution and delivery of this Bond
Purchase A~eement (the "Ageement").
In light of such authority, the undersig-ned (the "Underwriter") offers to enter into this A~eement with the
Issuer. Upon your acceptance, this A~eement shall be in full force and effect in accordance with its terms
and shall be binding upon the Issuer and the Underwriter.
1)Sale; Purchase Price. Upon the terms and conditions and in reliance upon the representations set
forth herein, the Underwriter hereby a~ees to purchase from the Issuer and the Issuer hereby agees
to sell to the Underwriter all (but not less than all) of the Bonds in the aggegate principal amount of
$17,980,000 at an ag~egate purchase price of $18,521,854.22, which amount represents the (i) net
reoffering premium of $660,506.35 and (ii) Underwriter’ discount of $118,652.13 ($6.60/$1,000 of
par value of the Bonds), together with accrued interest on the Bonds from Augxlst 1, 2006 to the
Closing Date. The Bonds shall be issued and secured under and pursuant to the Ordinance dated July
17, 2006 and shall mature, bear interest and be subject to redemption as set forth in Exhibit A hereto.
2)Representations of the Underwriter. The Underwriter a~ees to make a bona_fide public offering of
atl the Bonds at not in excess of the initial public offering prices, or less than the yields, set forth on
Exhibit A hereto, plus accrued interest, if any. Subsequent to such initial public offering, the
Underwriter reserves the right to change the punic offering prices and yields as they may deem
necessary in connection with the marketing of the Bonds.
The Bonds may be offered and sold to certain dealers and others (including Underwriter and other
dealers depositing Bonds into investment trusts or mutual funds) at prices lower than such public
offering prices.
3)Preliminary and Final Official Statements. The Issuer shall deliver or cause to be delivered to the
Underwriter as soon as practicable, and not more than seven (7) business days, after acceptance
hereof, the Official Statement, substantially in the form of the Preliminary Official Statement dated
July 5, 2006 the "Preliminary Official Statement") with only such changes therein as shall have been
accepted by the Underwriter (such Preliminary Official Statement with such changes, if any, and
including the cover page and all appendices, exhibits and statements included therein or attached
thereto being called the "Official Statement"). The Issuer hereby authorizes the distribution by the
Underwriter of the Preliminary Official Statement in offering the Bonds for sale to prospective
purchasers of the Bonds.
4)Closing. On August 8, 2006, or at such other time, or on such earlier or later date as the Underwriter
and the Issuer may mutually agree (the "Closing Date"), the Underwriter will accept delivery of the
Bonds and pay the purchase price thereof as set forth in Section 1 herein by Federal Reserve System
wire transfer in immediately available Federal funds or by any other form of immediately available
Federal funds. The Bonds shall be delivered through The Depository Trust Company, New York,
New York ("DTC") in definitive form, bearing CUSIP numbers and issued under a book-entry
system.
5) Representations of the Issuer. The Issuer makes the following representations and warranties:
6)
a)The Issuer is a public body corporate organized and existing under the laws of the State of
Washington and is authorized to issue the Bonds, to enter into this Agreement and all
other agreements contemplated hereby and to adopt the Ordinance.
b)The Issuer has complied to date with all applicable provisions of the laws of the State of
Washington in connection with the execution and issuance of the Bonds.
c)The Ordinance has been duly and validly adopted, and this Agreement has been duly and
validly authorized and executed by the Issuer.
The Issuer has authorized all necessary action to be taken by it for (i) the issuance and sale
of the Bonds upon the terms set forth herein, in the Official Statement and in the
Ordinance; (ii) the execution, delivery, receipt and due performance of this Ageement,
the Bonds and the Ordinance and all other agreements contemplated hereby or required in
order to carry out, Nve effect to and consummate the transactions contemplated hereby;
and (iii) carrying out, ~ving effect to and consummation of the transactions contemplated
hereby.
e)The Bonds when issued, delivered and paid for as provided for herein and in the
Ordinance, will have been duly and validly authorized and issued and will constit’ate
limited tax general obligations of the Issuer secured as provided in the Ordinance and as
described in the Official Statement.
To the best knowledge of the Issuer, there are no legal or governmental proceedings
pending or threatened, or any basis therefore, wherein an unfavorable decision, ruling or
finding would have a material adverse effect on the validity or security of the Bonds, the
Ordinance, this Agreement or the transactions contemplated thereby or the power of the
Issuer to execute and deliver the Bonds or this Ageement, or adopt the Ordinance.
g)As of the date hereof and to the knowledge of the Issuer, the Preliminary Official
Statement does not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
h)The Preliminary Official Statement is deemed "final" in accordance with Rule 15c2-
12(b)(1) under the Securities Exchange Act of 1934.
Conditions to Closing. The Underwriter enters into this Agreement in reliance upon the
representations and warranties of the Issuer contained herein and in the Ordinance and in reliance
upon the representations and warranties to be contained in the documents and instruments to be
delivered at the Closing Date and upon the performance by the Issuer and its obligations hereunder
both on and as of the date hereof and as of the Closing Date. Accordingly, the Underwriter’s
7)
obligation under this Agreement to accept delivery of and to pay for the Bonds shall be conditioned
upon the performance by the Issuer of its obligations to be performed hereunder and under such
documents and instruments at or prior to the Closing Date, and shall also be subject to the following
additional conditions:
a)the representations and warranties of the Issuer contained herein shal! be true and correct on
the date hereof and on the Closing Date, as if made on and at the Closing Date;
b) at or prior to the Closing Date, the Underwriter shall receive the following documents:
i)certified copies of the Ordinance;
ii)the opinion of Gotttieb Fisher & Andrews, PLLC, as Bond Counsel, dated the
Closing Date, substantially in the form as attached in Appendix A to the Official
Statement;
iii)evidence of the insurance policy issued by MBIA Insurance Corporation ("MBIA").
iv)evidence satisfactory to the Underwriter that Standard & Poor’s Ratings Service
and Fitch Ratings have each issued their ratinga for the Bonds not lower than
"AAA" and that such ratings have not been withdrawn; and
v)such additional legal opinions, certificates, proceedings, instruments and other
documents as the Underwriter or Bond Counsel may reasonably request.
If the conditions to the Underwriter’ obligations contained in this Agreement are not satisfied
(unless otherwise waived in writing by the Underwriter) or if the Underwriter’s obligations shall
be terminated for any reason permitted herein, this Agreement shall terminate and neither the
Underwriter nor the Issuer shall have any further obligation hereunder except to reimburse the
Underwriter for expenses related to the printing and mailing of the preliminary and final Official
Statements.
Official Statement Amendment and Supplements. During the initial public offering of the Bonds
(a period concluding on the final date the Underwriter is charged with furnishing a copy of the
Official Statement to a potential customer under SEC Rule 15c2-12 but no later than six months after
the Closing Date), the Issuer will (a) not consent to the distribution of any amendment of or
supplement to the Official Statement to which, after having been furnished with a copy, the
Underwriter shall object in writing or which shall be disapproved by counsel for the Underwriter and
(b) if any event shall occur as a result of which it is necessary, in the opinion of the Underwriter, to
amend or supplement the Official Statement in order to make the Official Statement not misleading in
light of the circumstances existing at the time it is delivered to a purchaser, consent to the distribution
of an amendment of or supplement to the Official Statement, prepared without expense to the Issuer
(in form and substance satisfactory to the Underwriter) in a reasonable number of copies which will
amend or supplement the Official Statement so that it will not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements therein, in the
li~t of the circumstances existing at the time the Official Statement is delivered to a purchaser, not
misleading.
Underwriter Rights to Cancellation. The Underwriter shall have the ri~,~ht to cancel its obligation to
purchase the Bonds if between the date hereof and the Closing Date, (i) leNslation shall have been
enacted by the Congress of the United States or the leNslature of the State of Washin~on or
legislation shall have been reported out of committee of either body or be pending in committee of
either body, or a decision shall have been rendered by a court of the United States or of the State of
Washin~on or the Tax Court of the United States, or a ruling shall have been made or a regulation or
temporary regulation shall have been proposed or made or any other release or announcement shall
have been made by the Treasury Department of the United States or the Internal Revenue Service,
with respect to federal taxation upon revenues or other income of the general character of the Bonds
which, in the reasonable judganent of the of the Underwriter, materially adversely affects the market
for the Bonds, or (ii) there shall exist any event which, in the reasonable judgment of the Underwriter,
either (a) makes untrue or incorrect in any material aspect as of such time any statement or
information contained in the Official Statement or (b) is not reflected in the Official Statement but
should be reflected therein in order to make the statements and information contained therein not
misleading in any material respect, or (iii) there shall have occurred any outbreak of hostilities or any
other national or international calamity or crisis, the effect of which outbreak, calamity or crisis on the
financial markets of the United States is such as, in the reasonable jud~olnent of the Underwriter,
would make it impracticable for the Underwriter to market or enforce contracts for the sale of the
Bonds, or (iv) there shall be in force a general suspension of trading on the New York Stock
Exchange or minimum or maximum prices for trading shall have been fixed and in force, or
maximum ranges for prices for securities shall have been required and be in force on the New York
Stock Exchange, whether by virtue of a determination by that Exchange or by order of the Securities
and Exchange Commission or any other governmental authority having jurisdiction, or (v) a general
banking moratorium shall have been declared by either Federal, State of Washin~on or New York
authorities having jurisdiction and be in force, or (vi) there shall be established any new restriction on
transactions in securities materially affecting the free market for securities (including the imposition
of any limitation on interest rates) or extension .of credit by, or charge to the net capital requirements
of, Under, miter established by the New York Stock Exchange, the Securities and Exchange
Commission, any other federal or state agency or the Congress of the United States, or by Executive
Order.
9)Fees and Expenses. All fees, expenses and costs incident to the execution and performance of this
Agreement and to the authorization, issuance and sale of the Bonds to the Underwriter, including, but
not limited to, the cost of printing the Bonds, if any (and full execution thereof), the cost of printing
and mailing of the Preliminary and Final Official Statements, the fees and charges of Standard &
Poor’s Ratings Service and Fitch Ratings, the municipal insurance policy premium of MBIA, the fees
of the financial advisor, and the fees and expenses of Bond Counsel and the Paying Agent and
ReNstrar shall be paid by the Issuer. All expenses to be paid by the Issuer pursuant to this Agreement
may be paid from Bond proceeds to the extent permitted by the Ordinance.
!0)Notices. Any notice or other communication to be ~ven to the Issuer under this Agreement may be
Nven by delivering the same in writing at the address set forth above and any such notice or other
communications to be g-iven to the Underwriter may be Nven by delivering the same in writing to
D.A. Davidson & Co., 701 Fifth Avenue, Suite 3100, Seattle, Washin~on 98104, Attention: Public
Finance. The approval of the Underwriter when required hereunder or the determination of its
satisfaction as to any document referred to herein shall be in writing signed by the Underwriter and
delivered to you.
11)No Third Party Beneficiaries. This Agreement is made solely for the benefit of the Issuer and the
Underwriter (including successors or assigns of the Undelavriter, but excluding any purchaser, as such
purchaser, of Bonds from the Underwriter) and, to the extent expressed herein, controlling persons
thereof, and no other persons, parmership, association or corporation shall acquire to have any ri~t
hereunder or by virtue hereof. All representations and agreements of the parties to this Agreement
shall remain operative and in full force and effect regardless of any investigation made by or on
. behalf of the Underwriter and shall survive the delivery of and payment for the Bonds. Time shall be
of the essence of this Agreement. This Agreement shall be governed by, construed and enforced in
accordance with the laws of the State of Washin~on. This Agreement may be executed in any
number of counterparts each of which shall be an original but all of which together will constitute one
and the same instrument.
Very truly yours,
D.A. DAVIDSON & CO.
ed R. Eoff ~
Senior Vice President & Managing Director
Accepted and Agreed:
CITY OF RENTON
Kathy I~eolker
Mayor
EXItIBIT A
TEt~MS OF TIlE BONDS
Purchase Price:Par Amount of Bonds:
Plus: Reoffering Premium:
Less: Underwriter’s Discount:
Purchase Price:
$17,980,000.00
660,506.35
(118£52.13)
$18,521,854.22
Dated Date:
Delivery Date:
Augugt 1, 2006
August 8, 2006
Form/Denominations: The Bonds will be issued in $5,000 denominations or integral multiples thereof in fully
reNstered Book-Entry only form through the facilities of The Depository Trust Company ("DTC") in New York,
New York.
Interest Payable: Interest on the Bonds from their dated date will be payable semi-annually on June 1 and
December 1 (commencing December 1, 2006) to their maturity or prior redemption.
Maturity Schedule: The Bonds mature on the dates and in the amounts set forth below, subject to redemption
as hereinal’~er described, and will bear interest from August 1, 2006 to their respective maturities or dates of prior
redemption, whichever occurs first, at the rates as shown below:
Dat~
12/1/08
12/1/09
12/1/10
12/1/11
12/1/12
12/1/13
12/1/14
12/1/15
12/l/16
Amount
$520000
540,000
565,000
585,000
610 000
640,000
670,000
700,000
750.000
Coupon Yield Price*
4.25%3.84%100.894%
4.25 3.88 101.135
3.90 3.95 99.799
4.25 3.99 101.229
5.00 ] 4.03 105.354
4.50 I 4.10 102.500
5.25 4.17 107.516
5.25 4.24 107.698
4.30 4.27 100.242
* Price is calculated to the
2017.
I Date
!2/1/17
I12/1/19
12/1/20
12/1/21
!12/1/22
12/1/23
12/1/24
12/1/28
Amount Coupon
$775,000 5.00%
1,670,000 5.00
900,000 5.00
945,000 5.O0
1,000,000 5.25
1,040,000 5.25
1,095,000 5.25
4,975,000!5.00
Yield
4.33%
4.49
4.51
4.54
4.48
4.50
4.51
4.72
December 1, 2016 OPtional
Price*
105.519%
104.167
103.999
103~748
106.297
106A27
106.042
102.248
redemption date for bonds maturing on and after December 1,
True Interest Cost:4.6861218%
Optional Redemption: Bonds maturing on or after December 1, 2017 are subject to redemption at the option of the
Issuer prior to their stated maturity dates, from funds from any source, at any time, in whole or in part on or after
December 1, 2016 within one or more maturities selected by the Issuer Coy lot in the manner determined by the
ReNstrar or DTC) at the price of par (100%) plus interest accrued to the date of redemption.
Mandatory Term Bond Redemption:
Bonds maturing on December 1, 2019 are Term Bonds and subject to mandatory redemption at par (100%) in
accordance with the following schedule:
12/1/18 $815,000
12/1/19 $855,000
Bonds maturing on December 1, 2028
accordance with the following schedule:
are Term Bonds and subject to mandatory redemption at par (100%) in
I12/1/25 $1,155,000
12/1/26 I $1,210,000
12/1/27 I $1,275,000
12/1/28 !$1,355,000
Bond Counsel:
Registrar:
Gottlieb Fisher & Andrews, PLLC, Seattle, Washin~on
The Bank of New York, Ne~v York, NY
The Depository Trust Company
A subsidiary of The Depository Trust & Cleadng Corporation
ISSUER LETTER OF REPRESENTATIONS
[To be Completed by Issuer]
City of Renton, Washington
[Name of Issuer]
see Exhibit A
[CUSIP Number of the Securities]
[For Municipal Issues:
Underwriting Department--Eligibili~’; 50~ Floor]
[For Corporate Issues:
General Counsel’s Office; 49th Floor]
The Depository Trust Company
,55 Water Street
New York, NY 10041-0099
August 8, 2006
[Date]
Ladies and Gentlemen:
This letter sets fot~ch our understanding with respect to the Securities represented by the CUSIP
number referenced above (the "Securities’). Issuer requests that The Depositor?," Trust Company
("DTC") accept the Securities as eli~ble for deposit at DTC. b.A. Davidson a Co.(man-
ager, underwriter, or placement agent) will distribute the securities through DTC.
To induce DTC to accept the Securities as eligible for deposit at DTC, and to act Ja~ accordance
with DTC’s Rules with respect to the Securities, Issuer covenants to DTC that Issuer will comply
with the requirements applicable to it stated in DTC’s Operational Arrangements (found at
~vw.dtee.eom m~d w~ww.dte.org), as they may be amended from time to ~ne.
Note:
Schedule A contains statements that DTC believes accu-
rately describe DTG. the method of effeeting book-entry
tran2ffers of securities distributed through D~C, and cer-
tain related matters.
Received and Accepted:
TBI~ST
:
DTCCo
The Depository Trust &
Clearing Corporation
Ve.ry truly yours,
City of Renton, Washington
(Iss,ae):a--x
~Authorized Oft~eer’s ~ignature)
Michael ~. Bailey
(Print Name)
~055 South Grady Way
(Street Address)
Renton WA USA 98058
(City.,)(State)(Country.’)(Zip Code)
(425 ) 430-6658
(Phone Number)
mebailey@ei.renton.wa.us
(E-marl Address)
[3/04]
SCHEDULE A
(To Issuer Letter of Representations)
SAMPLE OFFERING DOCI.~IENT LANGUAGE
DESCRIBING BOOK-ENTRY-ONLY ISSU_4ANCE
(Prepared by DTC--bracketed material may" be applicable only to certain issues)
1. The Deposito .ry Trust Company" ("DTC"), New York, NY, will act as securities depositolT for the
securities (the "Securities"). The Securities will be issued as fully-registered securities registered in the
name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an author-
ized representative of DTC. One fully-registered Security certificate ~qll be issued for [each issue of] the
Securities, [each] in the ag~egate principal mnonnt of such issue,and will be deposited with DTC. [If,
however, the aggregate principal amount of [any] issue exceeds $500 million, one certificate ~vill be issued
~vith respect to each $500 million of principal anaount, and an additional certificate ~4]1 be issued with
respect to any remaining principal anmunt of such issue.]
2. DTC, the world’s largest securities depositor; is a limited-purpose trust company organized under
the New York Banking Law, a "banking organization" ~ithin the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing emporation" within the meaning of the New York
Unffon’a Commercial Code, and a "clearing agency’" registered pursuant to tim provisions of Section 17:4
of the Securities Exchange Act of 1934. DTC holds and provides asset ser~Seing for over 2.2 million issues
of U.S. and non-U.S, eqni~, issues, corporate and municipal debt issues, and money market instnmaents
from over 100 countries that DTC’s participants ("Direct Participants") deposit xv~th DTC. DTC ’also facil-
itates the post-trade settlement among Direct Participants of sales mad other securities transactions in
deposited securities, through electronic cmnputerized book-entry transfers and pledges between Dh’ect
Participants’ accomats. This eliminates the need for physical movement of securities certificates. Direct
Participants include both U.S. and non-U.S, securities brokers and dealers, banl,:s, trust companies, clear-
ing corporations, and certain other organizations. DTC is. a wholly-o,amed subsidiary:, of The Depository
Trust & Clearing Corporation ("DTCC’). DTCC, in turn, is owned by a number of Direct Participants of
DTC and Members of the National Securities Clearing Corporation, Fixed Income Clearing Corporation,
and Emerging Markets Clearing Corporation (NSCC, FICC, and EMCC, .also subsidiaries of DTCC), as
well as by the New York Stock Exchange, Inc., the .American Stock Exchange LLC, and the National
Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as both
U.S. mad non-U.S, securities brokers and dealers, banks, trust companies, and clearing corporations that
clear through or mahatain a custodial relationship xvSth a Direct Participant, either directly or indirectly
("Indirect Participants"). DTC has Standard & Poor’s highest raW,g: K&a,. The DTC Rules applicable to
its P’articipants are on file xv~th the Securities and Exchange Commission. More information about DTC
can be found at www.dtcc.com and www.dtc.org.
3. Purchases of Securities under the DTC system must be made by or through Direct Participants,
which will receive a credit for the Securities on DTC’s records. The ovmership interest of each actual pur-
chaser of each Seeufi .ty ("Beneficial O,amer")is in turn to be recorded on the Direct and Indirect
Participants" records. Beneficial Owners ~v@l not receive ~a-itten confirmation from DTC of their purchase.
Beneficial Owners are, however, ex-peeted to receive written eon}’armations providing details of the transac-
tion, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which
the Beneficial Owner entered into the transaction. Transfers of mvnerst~ip interests in the Securities are to
be accomplished by entries made on the books of Direct and Indirect Participants acting on beha.lf of
Beneficial Owners. Beneficial Owaers will not receive eerti_fieates representing their o\vnership interests in
Securities, except in the event that use of the book-entry system for the Securities is discontinued.
4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are regis-
tered in the name of DTC’s part-nership nominee, Cede & Co., or such other name as mW be requested
by an authorized representative of DTC. The deposit of Securities x~6th DTC and their registration in the
name of Cede & Co. or such other DTC nominee do not effect any change in benei:ieial ownership. DTC
has no kno~vledge of the actual Beneficial Owners of the Securities; DTC’s records reflect only the identi)"
[3/04]
of the Direct Participants to whose accounts such Securities are credited, which may’ or may not be the
Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of
their holdings on behalf of their customers.
5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Pm-ticipants and Indirect Participants to Beneficial
Owners ~vill be governed by arnmgements anong them, subject to any statutory or regulato .ry require-
ments as may be in effect from time to thne. [Beneficial Owners of Securities may wish to take certain
steps to augment the transmission to them of notices of significant events with respect to the Securities,
such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For exam-
ple, Beneficial Owners of Securities may ~vish to ascertain that the nominee holding the Securities for
their benefit has agreed to obtt~n and transmit notices to Beneficial Owners. In the alternative, Beneficial
O~vners may wish to provide their names and addresses to the registrar and request that copies of notices
be provided directly" to them.]
[6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being
redeemed, DTG’S practice is to determine by lot the amount of the interest of each Direct Participant in
such issue to be redeemed.]
7. Neither DTC nor Gede & Co. (nor any other DTC nominee) will consent or vote with respect to
Securities unless authorized by a Direct Participant in accordance with DTC’S Procedures. Under its usual
procedures, DTG m~s an Omnibus Proxy to Issuer as soon as possible ~ffter tlle record date. The
Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose
accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).
8. Redemption proceeds, clistributions, and dividend payments on the Securities ~411 be made to Cede
& Co., or such other nominee as may" be requested by an authorized representative of DTC. DTC’S prac-
tice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail infor-
mation from Issuer or Agent, on payable date in accordance with their respective holdings sho~;~ on
DTC’S records. Pa,,anents by Participants to Beneficial Owners will be governed by standing instructions
and customaD; practices, as is the case with securities held for the accounts of customers in bearer form or
re~stered in "street name," and will be the responsibility of such Participant and not of DTC, Agent, or
Issuer. subject to troy statutoD" or re~latory requirements as m~; be in effect from time to time. Payment
of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as
may" be requested by an authorized representative of DTC) is the responsibility. of Issuer or Agent, dis-
bursement of such payments to Direct Participants ~vill be the responsibility of DTC, and disbursement of
snch pay’ments to the Beneficial Ow-ners w~ be the responsibility of Direct and Indirect Participants.
[9. A Beneficial Owner shall ~ve notice to elect to have its Securities purchased or tendered, through
its Participant, to [TenderfRemarketing] Agent, aid shall effect dehve~ of such Securities by causing the
Direct Participant to transfer the Participant’s interest in the Securities, on DTC’s records, to
[Tender/iRemarketing] Agent. The requirement for ph,v~ical delivery of Securities in connection with an
optional tender or a mandatory, purchase will be deemed satisfied when the ownership rights in the
Securities axe transferred by Direct Participants on DTC’s records and followed by a book-entry credit of
tendered Secm~ties to [TenderiRemarketing] Agent’s DTC account.]
10. DTC may discontinue providing its ser,,iees as depositoD, with respect to the Securities at any ~ne
by gMng reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor
depositor?" is not obtained, Security certificates are required to be printed and delivered.
11. Issuer may decide to discontinue use of the system of book-entry-only transfers through DTG (or a
successor securities depositor,i’). In that event, Security certificates ~ll be printed and dehvered to DTC.
1~. The information in this section concerning DTG and DTC’s book-entry system has been obtained
from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy thereof.
[a104] ~
Rider 1
1. DTC acknowledges that it holds in accordance with its Rules and Regulations the
Securities and any payments made in respect of the Securities in custody for its Participants in
accordance with their r~espective holdings, as shown on the records of DTC.
- Rider 1 -
mbnd1319-7/99
EXHIBIT A
$17,980,000
CITY OF RENTON, WASH~GTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
CUSIP
Maturity Date Principal Interest Rate
(September 1)Amount Per Annum
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
760133
QL5
QM3
QN1
QP6
QQ4
QR2
QSO
QT8
QU5
QV3
Qx9
QY7
Qz4
RA8
RB6
RC4
RG5
2008 $520,000
2009 540,000
2010 565,000
2011 585,000
2012 610,000
2013 640,000
2014 670,000
2015 700,000
2016 750,000
2017 775,000
2019"1,670,000
2020 900,000
2021 945,000
2022 1,000,000
2023 1,040,000
2024 1,095,000
2028*4,975,000
4.25%
4.25
3.90
4.25
5.00
4.50
5.25
5.25
4.30
5.00
5.00
5.00
5.00
5.25
5.25
5.25
5.00
* Term Bonds
f:~renton\ltgo 06
DISCLOSURE AND DEBT LIMIT CERTIFICATE
I, MICHAEL E. BAILEY, hereby certify that:
1. I am the duly appointed, qualified and acting Finance and Information Services
Administrator of the City’ofRenton, Washington (the "City").
2. This Certificate is made and delivered in connection with the authorization, sale,
issuance and delivery of the $17,980,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATION BONDS, 2006 (the "Bonds").
3. To the best of my knowledge and belief, the representations of the City contained
in that certain Bond Purchase Agreement pertaining to the Bonds, dated July 17, 2006, between
the City and D.A. Davidson & Co. (the "Underwriter"), were true and correct when made, and
remain true and correct as of this date.
4. I have read the Official Statement pertaining to the Bonds, dated July 17, 2006,
including any addenda, supplements or amendments thereto (collectively, the "Official
Statement") and, to the best of my knowledge, the Official Statement (except for information
concerning the Underwriter, MBIA Insurance Corporation, The Bank of New York and The
Depository Trust Company) as of its date and as of the date hereof does not contain any untrue
statement of a material fact or omit any material fact necessary in order to make the statements
made therein, in light of the circumstances under which they were made, not misleading in any
material respect, and there has not been any material adverse change in the normal operations or
financial condition of the City or in the general economy of the City since the date of the Official
Statement.
5. Pursuant to Section XIII of Ordinance No. 5215 of the City, which authorizes the
issuance, sale and delivery of the Bonds, my execution of the Official Statement is authorized.
Execution of this Certificate shall constitute execution of the Official Statement.
6. The actual value of taxable property subject to taxation situated within the
boundaries of the City, as ascertained by the King County Assessor in the last preceding
assessment for the City, and as equalized and fixed by King County and the State of Washington
Board of Equalization, is $7,334,476,542. The aggregate principal amount of outstanding
limited tax general obligation indebtedness of the City (including the principal amount of the
Bonds), less the amount legally available for payment of all such limited tax general obligation
indebtedness, is less than $110,017,148, which is one and one-half percent of said amount (the
statutory limit on indebtedness of the City which may be incurred without the consent of the
voters) as of this date.
f:~renton\ltgo 06 1
1N WITNESS WHEREOF, I have hereunto subscribed my official signature this 8th day
of Auga~st, 2006.
MICHAEL E. BAIEEY
Finance and Information Services Administrator
City of Renton, Washington
f:henton\ttgo 06 2
CERTIFICATE OF MBIA INSURANCE CORPORATION
I, Stephanie Tayloor Ciavarello, Assistant Secretary of MBIA Insurance Corporation, do
hereby certify, that the information concerning MBIA Insurance Corporation and its policies as
set forth in the Official Statement, dated July 17, 2006 under the caption "Municipal Bond
Insurance", regarding $17,980,000 City of Renton, Washington, Limited Tax General Obligation
Bonds, 2006, is accurate.
IN WITNESS WHEREOF, I hereunto set my hand and deliver this Certificate on this 8th
day of August, 2006.
Assista~nt Secretar)~-) "
SIGNATURE IDENTIFICATION AND NO LITIGATION CERTIFICATE
I, BONNIE I. WALTON, hereby certify that:
1. I am the duly appointed, qualified, and acting City Clerk of the City of Renton,
Washin~on (the "City").
2. This Certificate is made and delivered in connection with the authorization, sale,
issuance and delivery of the $17,980,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATION BONDS, 2006 (the "Bonds").
3. Pursuant to Ordinance No. 5215 of the City (the "Bond Ordinance"), authorizing
the issuance and sale of the Bonds, each of the Bonds was duly executed on behalf of the City
with the manual signature of KATHY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with my manual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor Keolker and the signature appearing on the Bonds is her true and
genuine signature.
4.The manual signature appearing below is my true and genuine signature.
5. The seal of the City appearing on each of the Bonds is the legally adopted, proper
and official seal of the City.
6. The following City Council members were incumbent on July 17, 2006, the date
on which the City Council adopted the Bond Ordinance, and they remain incumbent in such
positions on this date:
Randall Corman
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. No litigation or other proceedings are pending or, to the best of my knowledge,
threatened in any court or other tribunal of competent jurisdiction, state or federal, in any way:
(a)Restraining or enjoining the sale or delivery by the City of the Bonds;
(b) Questioning in any manner the authority of the City to issuel or the
issuance or validity of the Bonds;
(c) Questioning the constitutionality of any statute, ordinance or resolution, or
the validity of any proceedings, authorizing the issuance of the Bonds;
f:h-enton\ltgo 06 1
(d)Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(f) Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect adversely affect the transactions
contemplated herein and in the Official Statement to be undertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
BONNIE I. WALTON
City Clerk
City of Renton, Washington
f:h-enton\ltgo 06 2
CERTIFICATE RE AUTHENTICATION AND
REGISTRATION OF BONDS
THE BANK OF NEW YORK, New York, New York, hereby certifies as follows:
1. As one of~he fiscal agents for the State of Washington in accordance with the
terms and conditions of that certain Fiscal Agency Contract (the "Fiscal Agency Contract")
effective as of February 1, 2002, by and between The Bank of New York and the State of
Washington, we have duly and properly authenticated and registered CITY OF RENTON,
WASHINGTON, LIMITED TAX GENERAL OBLIGATION BONDS, 2006 (the "Bonds")
aggregating $17,980,000 in principal amount, pursuant to the instructions given to us by D.A.
Davidson & Co. as the Underwriter thereof.
2. The persons whose signatures appear on the Certificate of Authentication on each
authenticated Bond are duly authorized signatories of The Bank of New York.
3. All of said Bonds authenticated by the said authorized signatories bore, in the
spaces appropriate for the insertion of such information, the name of the registered owner, the
principal amount, the interest rate, the maturity date, the Bond number and the CUSIP number
thereof.
4. We shall be liable for the performance of our duties and obligations as
specifically set forth in the Fiscal Agency Contract. We shall act in good faith, and no implied
duties or obligations shall be incurred by us other than those specified in the Fiscal Agency
Contract.
DATED at New York, New York as of the 8th day of August, 2006.
THE BANK OF NEW YORK
B
Name:
Title:
f:\~renton\ltgo 06
Number: 1
SPECIMEN
$520,000
UNITED STATES OF AMERICA
STATE OF WASHINGTON
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BOND, 2006
Interest Maturity Date:CUSIP No.:
Rate: 4.25%December 1, 2008 760133 QL 5
Owner: CEDE & CO.
Principal Amount: FIVE HUNDRED TWENTY THOUSAND AND NO/100 DOLLARS
The CITY OF RENTON, WASHINGTON (the "City"), for value received, promises to
pay to the Owner set forth above the Principal Amount set forth above, on the Maturity Date set
forth above; and to pay interest thereon (computed on the basis of a 360-day year of twelve
30-day months) from the date of this Bond or from the most recent interest payment date to
which interest has been paid or duly provided for,. whichever is later, at the Interest Rate per
annum set forth above, payable on December 1, 2006, and semiannually thereafter on each
June 1 and December 1 to the maturity or earlier redemption of this Bond. If this Bond is not
paid upon proper presentment at its maturity or earlier redemption date, the City shall have the
obligation to pay interest at the Interest Rate set forth above from and after such maturity or
earlier redemption date unti! this Bond, both principal and interest, is paid in full.
Capitalized terms defined in Ordinance No. 5215 of the City (the "Bond Ordinance") and
used herein shall have the same meanings when used herein, unless the context otherwise directs.
Both principal of and interest on this Bond are payable in lawful money of the United
States of America. Prior to the Book-Entry Termination Date, principal of and interest on this
Bond shall be paid by the ReNstrar to the Custodian as the Owner hereof for the benefit of the
Beneficial Owners hereof, in accordance with the Letter of Representations. From and after the
Book-Entry Termination Date, principal of this Bond shall be paid to the Owner only upon
presentation and surrender of this Bond by the Owner at either of the principal corporate trust
offices of the fiscal agencies of the State of Washington (the "State") in Seattle, Washington, or
New York, New York (collectively, the "Registrar"~. From and after the Book-Entry
Termination Date, interest on this Bond shall be paid by check or draft mailed on or before the
interest payment date to the Owner at the address for such Owner appearing on the registration
books maintained by the Registrar (the "Bond Register") on the fifteenth day of the month
SPECIMEN..
preceding the interest payment date; provided, however, that if so requested in writing by the
Owner of at least $1,000,000 principal amount of Bonds, interest will be paid by wire transfer on
the interest payment date to an account with a bank located in the United States.
This Bond is a limited tax general obligation of the City. Unless the principal of and
interest on this Bond are paid from other sources, so long as any Bonds are outstanding, the C!ty
has irrevocably covenanted in the Bond Ordinance to include in its budgets and to make annual
levies of taxes within the constitutional and statutory tax limitations provided by law without a
vote of the qualified voters of the City upon all property within the City subject to taxation in
amounts which, together with any other money legally available therefor, shall be sufficient to
pay such principal and interest as the same shall become due. The City has irrevocably pledged
its full faith, credit and resources to the annual levy and collection of such taxes for the prompt
payment of such principal and interest.
This Bond is one of a duly authorized issue of bonds of the City designated "City of
Renton, Washington, Limited Tax General Obligation Bonds, 2006" (the "Bonds"), aggregating
$17,980,000 in principal amount, maturing annually on December 1 in the years 2008 through
2017, inclusive, in the years 2020 through 2024, inclusive, and on December 1 in the years 20!9
and 2028, of like date, tenor and effect, except as to number, maturity date, interest rate and
denomination. The Bonds are issued in fully registered form in the denomination of $5,000 each
or any integral multiple thereof within a single maturity.
The registered ownership of this Bond may be transferred. Prior to the Book-Entry
Termination Date, the beneficial ownership of the Bonds may only be transferred on the records
established and maintained by the Custodian. On and after the Book-Entry Termination Date,
this Bond may be transferred but only in the manner and subject to the limitations set forth in the
Bond Ordinance, and only upon the surrender at any principal corporate trust office of the
Registrar of this Bond, with the assignment form appearing hereon duly executed by the Owner
hereof or such Owner’s duly authorized agent in a manner satisfactory to the Registrar. Upon
such surrender, the Registrar shall cancel the surrendered Bond and shall authenticate and
deliver, without charge to the Owner or transferee therefor (other than any governmental fees or
taxes payable on account of such transfer), a new Bond or Bonds (at the option of the new
Owner) of the same maturity and interest rate, and for the same aggregate principal amount, in
any authorized denomination, naming as Owner the person or persons listed as the assignee on
the assignment form appearing on the surrendered Bond, in exchange four such surrendered and
cancelled Bond. On and after the Book-Entry Termination Date, this Bond may be surrendered
at any principal corporate trust office of the Registr~ and exchanged, without charge, for an
equal aggregate principal amount of Bonds of the same maturity and interest rate, in any
authorized denomination. The Registrar shall not be obligated to transfer or exchange any Bond
during the 15 days preceding any applicable interest payment, principal payment or redemption
date.
-;
The Bonds maturing on December 1, in the years 2019 and 2028 are term bonds (the
"Term Bonds") and, if not previously purchased by the City in the open market or optionally
redeemed as set forth below, are subject to mandatory sinking fund redemption in part and by lot
(in such manner as the Registrar shall determine), at par plus accrued interest to the redemption
2
SPECIMEN_
date on December I in the following years and in the following mandatory sinking fund
redemption amounts:
Mandatory Sinking Fund
Redemption Dates
(December !).
Mandatory Sinking Fund
Redemption Amounts
2018 $ 815,000
2019’855,000
2025 1,155,000
2026 1,210,000
2027 1,275,000
2028*1,335,000
*Scheduled maturity
The Bonds maturing on December 1 in the years 2008 through 2016, inclusive, shall not
be subject to redemption prior to maturity. The Bonds maturing on or after December 1, 2017
are subject to optional redemption prior to maturity beginning on December 1, 2016, in whole or
in part at any time (maturities to be selected by the City and by lot within a maturity in such
manner as the Registrar shall determine), at par plus accrued interest to the date of redemption.
If the City shall optionally redeem Term Bonds or purchase Term Bonds in the open market, the
par amount of the Term Bonds so redeemed or purchased (irrespective of their actual redemption
or purchase prices) shall be credited against one or more scheduled mandatory redemption
amounts for such Term Bonds (as allocated by the City) beginning not earlier than 60 days after
the date of the optional redemption or purchase, and the City shall promptly notify the Registrar
in writing of the manner in which the credit for the Term Bonds so redeemed or purchased has
been allocated.
Any Bond in the principal amount of greater than $5,000 may be partially redeemed in
any integral multiple of $5,000. Prior to the Book-Entry Termination Date, Bonds shall be
partially redeemed in accordance with the Letter of Representations. From and after the Book-
Entry Termination Date, in the event of a partial redemption of a Bond, upon surrender of such
Bond at the principal corporate trust office of the ReNstrar, a new Bond or Bonds (at the option
of the Owner) of the same maturity and interest rate and in the aggregate principal amount
remaining unredeemed shall be authenticated and delivered to the Owner, without charge to tl~e
Owner for such partial redemption, in any denomination authorized by the Bond Ordinance and
selected by the Owner.
Prior to the Book-Entry Termination Date, the Registrar shal! give, or cause to be given,
notice of a call for redemption of any Bonds t0_the Custodian, as the Owner thereof, for the
benefit of the Beneficial Owners thereof, in accordance with the Letter of Representations. From
and after the Book-Entry Ten, nation Date, notice of any such intended redemption shall be
given by or on behalf of the City not less than 30 nor more than 60 days prior to the date fixed
for redemption by first-class mail, postage prepaid, to the Owner of each Bond to be redeemed at
SPEC1ME I
the address appearing on the Bond Register on the day the notice is mailed. The requirements of
the Bond Ordinance shall be deemed to be complied with when notice is mailed as therein
provided, whether or not it is actually received by the Owner. If such notice has been given and
the City has set aside sufficient money for the payment of all Bonds called for redemption on the
date fixed for redemption, the Bonds so called shall cease to accrue interest after such
redemption date, and all such Bonds shall be deemed to be no longer outstanding under the Bond
Ordinance for any purpo~se, except that the Owners of such Bonds shall be entitled to receive
payment of the redemption price and interest accrued on the principal of the Bonds to the
redemption date from the money set aside for such purpose.
This Bond and the other Bonds of this series are issued pursuant to and in full compliance
with the constitution and statutes of the State and pursuant to proceedings duly adopted by the
City, including, but not limited to, the Bond Ordinance. The Bonds are issued for the purpose of
providing part of the funds necessary to pay the costs of constructing transportation and utility
infrastructure and improvements in the South Lake Washingon Infrastructure project and the
SW 27th Street Extension project, and to pay incidental costs thereof and the costs related to the
sale and issuance of the Bonds, all as provided in the Bond Ordinance.
The covenants contained herein and in the Bond Ordinance may be discharged by making
provision, at any time, for the payment of the principal of and interest on this Bond in the manner
provided in the Bond Ordinance.
Reference is made to the Bond Ordinance for other covenants and declarations of the City
and other terms and conditions upon which this Bond has been issued, which terms and
conditions are made a part hereof by this reference. The City unconditionally covenants that it
will keep and perform all of the covenants of this Bond and the Bond Ordinance.
It is certified that al! acts, conditions and things required by the constitution and statutes
of the State to have happened, been done and performed precedent to and in the issuance of this
Bond have happened, been done and performed, and that the issuance of this Bond does not
violate any constitutional, statutory or other limitation upon the amount of indebtedness that the
City may incur.
This Bond shall not be valid or become obligatory for any purpose unless and until the
certificate of authentication hereon shall have been manually executed by an authorized
signatory of the Registrar.
The City and the Registrar, each in its discretion, may deem and treat the Owner hereof
as the absolute owner hereof for all purposes, and neither the City nor the Registrar shall be
affected by any notice to the contrary.
4
SPECNEN
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation ("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede & Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede & Co., has an interest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON, WASI GTON
By
City
[SEAL]
CERTIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
STATEMENT OF INSURANCE
MBIA Insurance Corporation (the "Insurer") has issued a policy containing the following
provisions, such policy being on file at The Bank of New York, New York, New York.
The Insurer, in eonsideration of the payment of the premium and subject to the terms of
this policy, hereby unconditionally and irrevocably guarantees to any owner, as hereinafter
defined, of the following described obligations, the full and complete payment required to be
made by or on behalf of the Issuer to The Bank of New York, New York, New York or its
successor (the "Paying Agent") of an amount equal to (i) the principal of (either at the stated
maturity or by any advancement of maturity pursuant to a mandatory sinking fund payment) and
interest on, the Obligations (as that term is defined below) as such payments shall become due
but shall not be so paid (except that in the event of any acceleration of the due date of such
principal by reason of mandatory or optional redemption or acceleration resulting from default or
otherwise, other than any advancement of maturity pursuant to a mandatory sinking fund
payment, the payments guaranteed hereby shall be made in such amounts and at such times as
such payments of principal would have been due had there not been any such acceleration, unless
the Insurer elects in its sole discretion, to pay in whole or in part any principal due by reason of
such acceleration); and (ii) the reimbursement of any such payment which is subsequently
recovered from any owner pursuant to a final judgment by a court of competent jurisdiction that
such payment constitutes an avoidable preference to such owner within the meaning of any
applicable bankruptcy law. The amounts referred to in clauses (i) and (ii) of the preceding
sentence shall be referred to herein collectively as the "Insured Amounts." "Obligations" shall
mean:
$17,980,000
CITY OF. RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
Upon receipt of telephonic or telegraphic notice, such notice subsequently confirmed in
writing by registered or certified mail, or upon receipt of written notice by registered or certified
mail, by the Insurer from the Paying Agent or any owner of an Obligation the payment of an
Insured Amount for which is then due, that such required payment has not been made, the
Insurer on the due date of such payment or within one business day after receipt of notice of such
nonpayment, whichever is later, will make a deposit of funds, in an account with U.S. Bank
Trust National Association, in New York, New York, or its successor, sufficient for the payment
of any such Insured Amounts which are then due. Upon presentment and surrender of such
Obligations or presentment of such other proof of ownership of the Obligations, together with
any appropriate instruments of assignment to evidence the assignment of the Insured Amounts
due on the Obligations as are paid by the Insurer, and appropriate instruments to effect the
appointment of the Insurer as agent for such owners-of the Obligations in any legal proceeding
related to payment of Insured Amounts on the Obligations, such instruments being in a form
satisfactory to U.S. Bank Trust National Association, U.S. Bank Trust National Association shall
disburse to such owners or the Paying Agent payment of the Insured Amounts due on such
Obligations, less any amount held by the Paying Agent for the payment of such Insured Amounts
and legally available therefor. This policy does not insure against loss of any prepayment
premium which may at any time be payable with respect to any Obligation.
As used herein, the term "owner" shall mean the registered owner of any Obligation as
indicated in the books maintained by the Paying Agent, the Issuer, or any designee of the Issuer
for such purpose. The term owner shall not include the Issuer or any party whose agreement
with the Issuer constitute~ the underlying security for the Obligations.
Any service of process on the Insurer may be made to the Insurer at its offices located at
113 King Street, Armonk, New York 10504 and such service of process shall be valid and
binding.
This policy is non-cancellable for any reason. The premium on this policy is not
refundable for any reason including the payment prior to maturity of the Obligations.
MBIA INSURANCE CORPORATION
7
ASSIGNMENT
For value received, the undersigned Owner(s) sell(s), assign(s) and transfer(s) unto:
(name, address and social security or other identifying number of assignee)
the within-mentioned Bond and hereby irrevocably constitute(s) and appoint(s)
to transfer the same on the Bond Register, with full power of substitution in the premises.
Owner(s)
NOTE:The signature(s) above must correspond with the name of the Owner(s) as it
appears on the front of this Bond in every particular, without alteration or
enlargement or any change whatsoever.
Signature(s) guaranteed:
NOTE:Signature(s) must be guaranteed by an eligible guarantor.
GOTTLIEB, FISHER ~g ANDREWS, PLLC
ATTORNEYS AT LAW
SPECNEi
August 8, 2006
Mayor and City Council
City of Renton
Renton, Washington 98055
Ladies and Gentlemen:
We have acted as bond counsel in connection with the issuance by the City of Renton,
Washington (the "City"), of the bonds described below (the "Bonds"): -
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
Dated: August 1, 2006
The Bonds are issued pursuant to Ordinance No. 5215 of the City (the "Bond.
Ordinance") and other proceedings duly had and taken in conformity therewith. The Bonds are
issued to provide part of the funds necessary to pay the costs of constructing transportation and
utility infrastructure and improvements in the South Lake Washington Infrastructure project and
the SW 27th Street Extension project, and to pay incidental costs thereof and the costs related to
the sale and issuance of the Bonds, all as provided in the Bond Ordinance.
The Bonds shall be issued in fully registered form as to both principal and interest; shall
be in the denomination of $5,000 each or any integral multiple thereof within a single maturity.
The Bonds bear interest (computed on the basis of a 360-day year of twelve 30-day months)
from their date or from the most recent interest payment date to which interest has been paid or
duly provided for, whichever is later, payable December 1, 2006, and semiannually thereafter on
each June 1 and December 1 to the maturity or earlier redemption thereof, at the rates set forth
below, and shall mature on December 1 in each of the years and in the principal amounts set
forth below:
520 Pik-e S~eet:, Sui~:e 2510 Sea~le, WA 9810!-4006
(206) 654-1999 P~one (206) 654-8725 Fax
Mayor and City Council
City of Renton, Washington
August 8, 2006
Page 2
SPECNEN
Maturity Date Principal Interest Rate
(December 1).Amount Per Annum
2008 $520,000 4.25%
2009 540,000 4.25
2010 565,000 3.90
2011 585,000 4.25
2012 610,000 5.00
2013 640,000 4.50
2014 670,000 5.25
20!5 700,000 5.25
2016 750,000 4.30
2017 775,000 5.00
2019"1,670,000 5.00
2020
2021
2022
2023
2024
900,000 5.00
945,000 5.00
1,000,000 5.25
1,040,000 5.25
1,095,000 5.25
2028*4,975,000 5.00
¯ *Term Bonds
The Bonds shall be subject to redemption prior to maturity at the times and in the manner
described in the Bond Ordinance. The City has reserved the rig)ht to purchase any or all of the
Bonds in the open market at any time and at any price.
In rendering this opinion letter, we have examined the following: (i) the Bond
Ordinance; (ii) a copy of one executed and authenticated Bond (we assume that all other Bonds
are in the same form and have been similarly executed and authenticated); and (iii) the certified
proceedings of the City and other certificates of public officials and representatives of the City
which have been furnished to us and which comprise the transcript of proceedings pertaining to
the issuance of the Bonds (the "Transcript").
As to questions of fact material to the opinions expressed herein, we have relied upon
the certified proceedings of the City and other.:certificates of public officials and representatives
of the City which have been furnished to us as-part of the Transcript, all without undertaking to
verify the same by independent investigation.
Mayor and City Council
City ofRenton, Washin~on
August 8, 2006
Page 3
SPECNEN
Based only upon the foregoing and our examination of such questions of law as we have
deemed necessary or appropriate for the purpose of this opinion letter, and subject to the
limitations and qualifications expressed below, we are of the opinion that, as of this date:
1. The Bonds are lawfully authorized and issued pursuant to and in fu!l compliance
with the constitution and statutes of the State and the Bond Ordinance.
2. The Bonds are legal, valid and binding general obligations of the City,
enforceable against the City in accordance with their terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors’ ri~,~hts, and also to the
exercise of judicial discretion in accordance with general principles of equity.
3. The City has irrevocably covenanted in the Bond Ordinance that, unless the
principal of and interest on the Bonds are paid from other sources, so long as the Bonds are
outstanding, the City shall include in its budgets and make annual levies of taxes within the
constitutional and statutory tax limitations provided by law without a vote of the qualified voters
of the City upon all property within the City subject to taxation in amounts which, together with
any other money legally available therefor, shall be sufficient to pay such principal and interest
on the Bonds as the same shall become due. The City has irrevocably pledged its full faith,
credit and resources to the annual levy and collection of such taxes and for the prompt payment
of such principal and interest.
4. Assuming compliance by the City with applicable requirements of the Internal
Revenue Code of 1986, as amended (the "Code), that must be met subsequent to the issuance of
the Bonds, interest on the Bonds, including any original issue discount properly al!ocable to an
owner thereof, is excludable from gross income for federal income tax purposes under existing
federal law and is not an item of tax preference for purposes of determining the federal
alternative minimum tax imposed on individuals and corporations under existing federal law.
However, under existing federal law, interest on the Bonds, including any original issue discount
properly allocable to an owner thereof, is taken into account in determining adjusted current
earnings for the purpose of computing the alternative minimum tax imposed on certain
corporations.
Except as stated in the preceding paragraph 4, we express no opinion as to any federal or
state tax consequences of receipt of interest on the Bonds.
The Code contains certain requirements that must be satisfied subsequent to the date of
issuance of the Bonds in order to maintain the exclusion of interest on the Bonds from gross
income for federal income tax purposes, inclu.ding requirements relating to application of the
proceeds of the Bonds, use of facilities fmance-d with such proceeds, limitations on income
derived from the investment of gross proceeds of the Bonds (as defined in Section 148 of the
Code), and rebate to the United States Treasury of certain investment earnings on such gross
proceeds. The City has covenanted to comply with these requirements to the extent applicable,
and the opinion expressed in paragraph 4 assumes such compliance. However, we have not
Mayor and City Council
City of Renton, Washington
Au~st 8, 2006
Page 4
SPECNEI
undertaken and do not undertake to monitor compliance by the City with such requirements; and
if the City should fail to comply with such requirements, interest on the Bonds could become
includable in gross income for federal income tax purposes retroactive to the date of issuance of
the Bonds.
We have not been engaged to participate in the preparation or review of, or to express
any opinion concerning the completeness or accuracy of, the official statement or other
disclosure documentation used in connection with the offer or sale of the Bonds, and thus
express no opinion concerning the completeness or accuracy thereof.
Copies of this opinion letter may be delivered to the Owners of the Bonds, who may rely
on this opinion letter as if it were addressed to such Owners on the date hereof. Subject to the
foregoing, this opinion letter may be relied upon by you only in connection with the issuance of
the Bonds and may not be used or relied upon by you or any other person for any other purpose
whatsoever, without in each instance our prior written consent. We expressly disclaim any
responsibility to advise you or any Owners of any developments in areas covered by this opinion
letter that occur after the date hereof.
Respectfully submitted,
GOTrLIEB, FISHER &PLLC
By
FINANCIAL GUARANTY INSURANCE POLICY
MBIA Insurance Corporation
Armonk, New York 10504
PoficyNo.48291
MBIA Insurance Corporation (the "Insure~’), in consideration of the payment of the premium and subject to the terms of this policy, hereby
unconditionally and irrevocably guam, mtees to any owner, as hereinafter defined, of the following descn’bed obfigations, the full and complete payment
required to be made by or on behalf of the Issuer to The Bank of New York, New York, New York or its successor (the ’~Paying Agent’~ of an amount
equal to (i) the principal of (either at the stated maturity or by any advancement of maturity pursuant to a mandatory sinking fund payment) and interest
on, the Obligations (as that term is defined below) as such payments shall become due but shall not be so paid (except that in the event of any acceleration
of the due date of such principal by reason of mandatory or optional redemption or acceleration resulting from default or otherwise, other than any
advancement of maturity pursuant to a mandatory sinking fund payment, the payments ~mmranteed hereby shall be made in such amounts and at such
times as such payments ofprincipal would have been due had there not been any such acceleration unless the Insurer elects in its sole discretion, to pay in
whole or in ~ any principal due by reason of such acceleration); and (ii) the reimbursement of any such payment which is subsequently recovered
from any owner pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes an avoidable preference to such owner
within the meaning of any applicable bankruptcy law. The amounts referred to in clauses (i) and (h) of the preceding sentence shall be referred to herein
collectively as the "Insured Amounts." "Obligations" shall mean:
$17,980,000
City of Renton, Washington
Limited Tax General Obligation Bonds, 2006
Upon receipt of telephonic or telegraphic notice, such notice subsequently confirmed in writing by registered or certified mail, or upon receipt of written
notice by registered or certified mail, by the Insurer fi’om the Paying Agent or any owner of an Obligation the payment of an Insured Amount for which is
then due, that such required payment has not been made, the Iv.surer on the due date of such payment or within one business day after receipt of notice of
such nonpayment, whichever is later, will make a deposit of funds, in an account with U.S. Bank Trust National Association, in New York, New Yo.rk,
or il~ successor, sufficient for the payment of any such Insured Amounts which are then due. Upon presentment and surrender of such Obligations or
presentment of such other proof of owner~ of the Obligations, together with any appropriate inslrunaents of assignment to evidence the assignment of
the Insured Amounts due on the Obligations as are paid by the Insurer, and appropriate instruments to effect the appointment of the Insurer as agent for "
such owners of the Obligations in any legal proceeding related to payment of Insured Amounts on the Obligations, such instruments being in a form
satisfactory to U,S. Bank Trust National Association, U.S. Bank Trust National Association shall disburse to such owners, or the Paying Agent payment
of the Insured Amounts due on such Obligations, less any amount held by the Paying Agent for the payment of such Insured Amounts and legally
available therefor. This policy does not insure ~ loss of any prepayment premium which may at any time be payable with ~ to any
Obligation.
As used herein, the term "owner" shall mean the registered owner of any Obligation as indicated in the books maintained by the Paying Agent, the Issuer,
or any designee of the Issuer for such purpose. The term ovmer shail not include the Issuer or any party whose agreement with the Issuer constitutes the
underlying security for the Obligatiom.
Any service of process on the Insurer may be made to the ~ at its offices located at 113 King Street, Armonk, New York 10504 and such service of
process shall be valid and binding.
This policy is non-cancellable for any reason. The premium on this policy is not refundable for any reason including the payment prior to maturity of the
Obligations.
IN WITNESS WHEREOF, the Insurer has caused this policy to be executed in facsimile on its behalf by its duty authorized officers, this 8th day of
August, 2006.
STD-R-7
01/05
Ali.est.
,ns .nce rporation
President
Assisff- Secretary
Capital Strength, Triple-A Performance.
August 8, 2006
MBIA Insurance Corporation
113 King Street, Armonk, NY 10504
Tel 914-273-4545
www.mbia.com
The Bank of New York
New York, New York
$17,980,000
City of Renton, Washington
Limited Tax General Obligation Bonds, 2006
Ladies and Gentlemen:
In connection with the above-described obligations (the "Obligations") of which you are acting as paying
agent (the "Paying Agent"), please be advised that the payment to you of principal of and interest on the
Obligations has been guaranteed by a policy of financial guaranty insurance (the "Policy") issued by the
MBIA Insurance Corporation (the "Insurer"). U.S. Bank Trust National Association, New York, New
York, (the "Fiscal Agent") is acting as the fiscal agent for the Insurer.
The Policy unconditionally and irrevocably guarantees to any owner or holder of the Obligations or, if
applicable, of the coupons appertaining thereto (the "Owner"), the full and complete payment required to be
made by or on behalf of the issuer of the Obligations (the "Issuer") to the Paying Agent or its successor of
an amount equal to (i) the principal of (either at the stated maturity or by any advancement of maturity
pursuant to a mandatory sinking fund payment) and interest on, the Obligations as such payments shall
become due but shall not be so paid (except that in the event of any acceleration of the due date of such
principal by reason of mandatory or optional redemption or acceleration resulting from default or
otherwise, other than any advancement of maturity pursuant to a mandatory sinking fund payment, the
payments guaranteed by the Policy shall be made in such amounts and at such times as such payments of
principal would have been due had there not been any such acceleration); and (ii) the reimbursement of any
such payment which is subsequently recovered from any Owner purstant to a final judgment by a court of
competent jurisdiction that such payment constitutes an avoidable preference (a "Preference") to the Owner
within the meaning of any applicable bankruptcy law. The amounts referred to in clauses (i) and (ii) of the
preceding sentence are referred to collectively in this letter as the "Insured Amounts."
The Policy does not insure against loss of any prepayment premium which may at any time be payable
with respect to any Obligations. The Policy does not, under any circumstance, insure against loss relating
to: (i) optional or mandatory redemptions (other than mandatory sinking fund redemptions); (ii) any
payments to be made on an accelerated basis; (iii) payments of the purchase price of Obligations upon
tender by an Owner thereof; or (iv) any Preference relating to (i) through (iii) above.
In the event that the Issuer does not make full and complete payment when due of the principal of and
interest on the Obligations, please immediately notify, by telephone or telegraph, the Insurer, 113 King
Street, Armonk, New York, 10504, (914) 273-4545. On the due date or within one business day alter
receipt of such notice, whichever is later, the Insurer will deposit funds with the Fiscal Agent sufficient to
pay the Obligations (or, if applicable, coupons appertaining thereto) then due. Upon presentment and
surrender of such Obfigations (or, if applicable, coupons) or presentment of such other proof of ownership
of Obligations together with any appropriate instruments of assignment to evidence the assignment of the
Insured Amounts due on the Obligations as are paid by the Insurer, and appropriate instruments to effect the
appointment of the Insurer as agent for the Owners in any legal proceeding related to payment of Insured
Amounts on the Obligations (or, if applicable, coupons), such instn~nents being in a form satisfactory to
the Fiscal Agent, the Fiscal Agent shall disburse to you payment of the Insured Amounts due on such
Obligations (and, if applicable, coupons), less any amount held by you for the payment of such Insured
Amounts and legally available therefor.
Forms of such insau-nents of assigrmaent and insmanents to effect the appointment of the Insurer as such
agent for the Owners (collectively, the "Claim Documents"), which are currently acceptable to the Fiscal
Agent and the Insurer, are on file with the Fiscal Agent. The Insurer may, f~om time to time, file revised
forms of Claim Documents with the Fiscal Agent in substitution for the forms previously filed with the
Fiscal Agent, and upon such .filing, the revised forms shall supersede all forms of Claim Documents
previously filed with the Fiscal Agent, except as otherwise directed by the Insurer in writing.
In the event that you shall have prior knowledge of an impending failure by the Issuer to make payment on
the Obligations (or, if applicable, coupons) when due, please immediately notify the Insurer so that it will
be possible to have funds available for you on the due date to make payments against surrendered
Obligations (and, if applicable, coupons).
Your cooperation in this matter will be most appreciated and will make it possible for the Owners of
Obligations guaranteed by the Insurer to be assured of all payments when due.
Very truly yours,
Neil G. Budnick
President
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
CERTIFICATE OF ISSUER AS TO MBIA INSURANCE POLICY
This Certificate is furnished by the City of Renton, Washington, as Issuer (the "Issuer")
of its $17,980,000 Limited Tax General Obligation Bonds, 2006, dated August 1, 2006 (the
’°Bonds"), and The Bank of New York, New York, New York, as paying agent under the Bonds
(the "Paying Agent") for use by MBIA Insurance Corporation ("MBIA") in connection with its
issuance of a municipal bond insurance policy No. 48291 (the "Policy"), guaranteeing the paying
of the principal and interest on the Bonds when due.
The Issuer and the Paying Agent hereby certify as follows:
1. The undersigned acknowledge receipt and review of MBIA’s "Payments Under
the Policy" provisions with respect to the Policy, attached hereto as Schedule A.
2. The undersigned hereby agee, during the term of the Policy and to the best of
their abilities, to abide by the terms, obligations, and provisions required by Schedule A hereto.
IN WITNESS WHEREOF, we have executed this Certificate as of the 8th day of August,
2006.
THE CITY OF RENTON,
WASHINGTON, as Issuer
B,By
THE BANK OF NEW YORK,
as Paying Agent
Michael E. Bailey
Finance and Information Services
Administrator
Name:
Title:
f:~renton\ltgo 06
PAYMENTS UNDER THE POLICY/OTHER REQUIRED PROVISIONS
A.In the event that, on the second Business Day, and again on the Business Day, prior to the payment date on the Obligations~ the
Paying Agent/Trustee has not received sufficient moneys to pay all principal of and interest on the Obligations due on the second fol]owing or follow, ring,
as the case may be, Business Day, the Paying Agent/Trustee shall in,mediately not~’ the Insurer or its designee on the same Business Day by telephone
or tele~m-apl~ confirmed in writing by registered or certified mail, of the an~ount of the deficiency.
B.lfthe deficiency is made up in whole or in part prior to or on the pay,ment date, the Paying Agent~q’rust~ shal! m no ~ti~.~ the Insurer
or its desigmee.
In addition, if the Paying Agent/Trustee has notice that any Bondholder has been required to disgo~e payments of principal or
interest on the Obligations to a trustee in bankruptcy or creditors or others pursuant to a final judgment by a court of cong:~tent jurksdiction tMt sucli
payment constitutes an avoidable preference to such Bondholder within the meaning of any applicable bankruptcy lav,,s: then the Pa3,ing AgenffI’mstee
shall notify the Insurer or its designee of such fact by telephone or tele=m-aphic notice, confirmed in writing by registered or certified mail.
D. The Paying Agent, q’mstee is hereby irrevocably designated, appointed, directed and authorized to act as attorney-in-fact for Holders
of the Obligations as follows:
1.If and to the extent there is a defidency in amounts required to pay interest on the Obligations, the Pa.,dng Agent~Trustee
shall (a) execute and deliver to U.S. Bank Trust National Association, or its successors under the Policy (the "h~surance Pay, ing
Agent~Tmstee"), in form satisfactory to the Instmance Paying Agentffrustee, an instrument appointing the Insurer as agent for such Holders in
any legal proceeding related to the payment of such interest and an assi~m’m~ent to the Insurer of the clah~s for interest to wt"dch such deficiency
relates and which are paid by the Imn.trer, (by receive as desi_m~ee of the respective Holders (and not as Pa.vh~g Agent’Trustee) in accor~nce
with the tenor of the Policy payment from the Insurance Paying Agent/Trustee with respect to the claims for interest so assigne< .and (c)
disburse the same to such respective Holders; and
If and to the extent of a deficiency in mnounts required to pay principal of the Obligations, the Paying Agent,Trustee st~dl
(a) execute and deliver to the Insurance Paying Agent/Trustee in form satisfiactory to the Instuance Paying Agent;Trustee an instrument
appointing the Insurer as agent for such t!older in any legal proceeding relating to the payment of such p~incipal and an assi_m’maent to the
Insur~ of any of the Obligation surrendered to the Insurance Paying Agent/Trustee of so much of the principal amount thereof as has not
pre,..iously been paid or for which moneys are not held by the Pa),ing Agent/Trustee and available for such payment (’out such assignment shall
be delivered only ffpayment from the Insurance Paying Agent/Trustee is received), (by receive as designee of the res.’pective Holders (~d not
as Paying AgenU’I’rnstee) in accordance with the tenor of the Policy payment theretbr from the Insnarance Paying Agent/Trustee, and (c)
disburse the stone to such Holders.
E.Pa~,ments with respect to claims for interest on and principal of Obligations disbursed by the Pa?.ing Agent, Trustee from proceeds of
the Policy shall not be considered to discharge the obligation of the Issuer with respect to such Obligations, and the Insurer shall become the owner of
such unpaid Obligation and clainm for the interest in accordance with the tenor of the assignment made to it under the provisions of this subsection or
othen,vise.
F. Irrm’pective of;vhether any such assignment is executed and delivered, the Issuer and the Paying Agentq’mstee hereby a~_oree for the
benefit of flxe Insurer that:
1.They reco~m-fize that to the extent the Insurer makes payments, directly or indirectly (as by paying tl-cou~ the Paying
Agent~Trustee), on account of principal of or interest on the Obligations, the Insurer will be subrogated to the fi~ts of such Holders to receive
the amount of such principal and interest from the Issuer, vdth interest thereon as provided and solely from the sources stated in this Indenture
and the Obligations; and
2. They will accordin~y pay to the Insurer the amount of such principal and interest (including principal and interest
recovered under subparagaph (ii) of the first paragnaph of the Policy, which principal and interest shall be deemed past due and not to trove
been paid), with interest thereon as provided in this Indenture and the Obligation, but only from the sources and in the rammer provided herein
for the payment of principal of and interest on the Obligations to Holders, and will othenvi~ tr~t the Insu..mr as the ox~mer of such fights to the
amount of such principal and interest.
G. In connection v, ith the issuance of additional Obligations, the Issuer shall deliver to the Insur’er a cop-‘" of the disclosure document, if
any, circulated with tin’peer to such additional Obligations.
H. Copies of any an~enchnents made to the docuanents executed in connection with the i~uance of the Obligations which are con.~nted
to by the Insurer shall be sent to Standard & Poor’s Corporation. . : -
I. The Insurer shall receive notice of the resi_m’mlion’or removal of the Paying Agen~q’mstee .and the appointment of a successor
J. The Insurer shall receive copies of all notices required to be delivered to Bondholders and, on an annual basis, copies of the !ssuef’s
audited financial statements and A.m~ual Budget
Notices: Any notice tl-mt is required to be ~ven to a holder 0fthe Obligation or to the Paying Agent/Trustee pursuant to the lndenmre ~ also
be provided to the In.snarer. All notices required to be ~,,’en to the Insurer under the Indenture shall be in whting and shall be sent by registered or certified
mail addressed to MBIA Insurance Corporation, 113 King Street,. Armonk, New York 10504 Attention: Surveillance.
K. The Issuer/Obligor a~mees to reimburse the Insurer irnmediately and unconditionally upon den’~md, to the extent permitted by law.
for all reasonable e.-q:mnses, including attorneys’ fees and expenses, incurred by the Inm.~er in connection with (i) the erffom,~anent by the Instuer of the
Issuer’s iObligor’s obtigations, or the preservation or defem~e of any rights of the Insurer, m~der this Resolution/Indenture and any other document
executed in connection with the issuance of the Obligations, and (ii) any consent, mnendment, ~,~aiver or other action with r~’pn’ct to the
Resolution/Indenture or any related document,. \vhether or not ~manted or approved, together \vith interest on all such expenses fi’om m~d including the
date incurred to the date of payment at Citibank:s Prime Rate plus 3% or the rn~x.irnum interest rote permitted by law, whichever is less. In addition_, the.
Insurer reserves the rigJat to charge a fee in connection with its review of any such consent, an~en.dment or waiver, whether or not granted or approved.
L. The Issuer/Obligor ,’i~-ees not to use the Insurer’s rmme in m~y public document including, without limitation., a pr~-~,s release or
presentation, mmouncement or forum without the Insurers prior conseng provided however, such prohibition on the use of the Ir~surer’s name sb2dl not
relate to the use of the Insurer’s standard al:rpmved form of disclosure in public doct.unents issued in connection v,,Jth the current Obligations to be iss’ued
in accordance ;vith the tern~ of the Commitment;" and provided further such prohibition stm!l not apply to the use of the Insurer’s nmne in order to conrply
wiN public notice, public meeting or public reporting requirements.
M. The Issuer/Obligor shall not enter into any agreement nor slmll it consent to or participate in any arrangement pursuant to which
Bonds are tendered or purctmz~l for any purpose other titan the redemption and cancellation or legal defeasance of such Bonds without the prior written
consent of MBI_A.
Revised 4!04
PRELIMINARY OFFICIAL STATEMENT dated July 5, 2006
NEW ISSUE INSURANCE: Applied For
BOOK-ENTRY ONLY RATINGS: Standard and Poor’s: Applied For
Fitch Ratings: Applied For
(See "Municipal Bond Insurance" and "Ratings" herein.)
In the opinion of Bond Counsel, as of the Date of Issue, and assuming the City complies with applicable requirements of the InternaI Revenue
Code of1986, as amended (the "Code "), that must be satisfied subsequent to the issuance of the Bonds: interest on the Bonds, including any
original issue discount properly allocable to an owner thereof is excluded.from gross income for purposes offederal income taxation; and is
not an ite~n of tax preference for purposes of determining the alternative minimum tax on individuals and corporations. However, such interest
on the Bonds, inch~ding any original issue discount properly allocable to an owner thereof is taken into account in determining adjusted
current earnings for purposes of the eomputbtg the alternative minimum tax imposed on certain corporations. See "Tax Exemption" and
"’Other Tax Consequences ’" herein..
$20,665,000*
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
DATED: August 1, 2006 DUE: December 1, as shown on the inside cover
The City of Renton, Washington (the "City") provides this Official Statement in connection with the issuance of its
Limited Tax General Obligation Bonds, 2006 (the "Bonds"). The Bonds mature on December 1 in each of the years
and amounts set forth on the inside cover herein, subject to optional redemption as hereinafter described, and will bear
interest from August 1, 2006, to their respective maturities or dates of prior redemption, at the rates per annum as
shown on the inside cover herein.
The Bonds will be issued as fully registered bonds under a book-entry system, initially registered to Cede & Co., as
nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository
for the Bonds. Individual purchases of Bonds will be made in the principal amount of $5,000, or integral multiples
thereof within a single maturity. The purchasers will not receive certificates representing their interest in the Bonds,
as long as the Bonds are in book-entry form. Interest will be payable semi-annually on June 1 and December 1,
commencing December 1, 2006. The Washington State Fiscal Agent, currently The Bank of New York will serve as
registrar, paying agent and transfer agent (the "Registrar") for the Bonds. For so long as the Bonds are held by DTC
in book-entry format, principal and interest payments will be made as described herein, see "The Bonds - Book-Entry
System".
The Bonds are limited tax general obligations of the City. For as long as any Bonds are outstanding, the City has
irrevocably covenanted to include in its budgets and make annual levies of taxes within the constitutional and statutory
tax limitations provided by law without a vote of the qualified voters of the City upon all property within the City
subject to taxation in amounts which, together with any other money legally available therefor, shall be sufficient to
pay the principal and interest on the Bonds as the same shall become due. The Bonds do not constitute a debt or
indebtedness of King County, the State of Washington, or any political subdivision thereof other than the City.
The proceeds of the Bonds will be used for the purpose of providing funds for construction of transportation and
utility infrastructure and improvements (the "Project") and to pay costs related to the issuance of the Bonds. (See
"The Bonds - Purpose and Use of Proceeds" herein).
The Bonds maturing on and after December 1, 2017 are subject to optional redemption prior to maturity. (See "The
Bonds - Security" and "The Bonds - Purpose and Use of Proceeds" and "The Bonds - Redemption" herein.)
The Bonds are offered by the Underwriter when, as and if issued by the City, subject to the opinion as to legality and
tax-exemption of the Bonds by Gottlieb, Fisher & Andrews, PLLC, Bond Counsel, Seattle, Washington. The fees of
Bond Counsel are contingent on the issuance of the Bonds. The Bonds, in book-entry form, are expected to be
available through the facilities of DTC for delivery by Fast Automated Securities Transfer on or about
August 8, 2006.
This cover page contains certain information for quick reference only. It is not a summary of this issue. Investors
must read the entire official statement to obtain information essential to making an informed investment decision.
Preliminary, subject to change.D.A. DAVIDSON & CO.
$20,665,000*
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
MATURITY SCHED[Y~E
Dated: August 1, 2006
Year
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
Due: December 1, as shown below
Amount*
$625,000
650 000
675 000
705 000
735 000
765 000
795 000
830 000
870 000
905 000
945,000
985,000
1,030,000
1,080,000
1,125,000
1,180,000
1,235,000
1,290,000
1,350,000
1,410,000
1,480,000
Interest Yield to Price
Rate Maturity (%ofPar)
%%%
CUSIP
* Preliminary; subject to change.
i The CUSIP numbers are included above for convenience of the holders and potential holders of the Bonds. No assurance
can be given that the CUSIP numbers for the Bonds will remain the same after the date of issuance and delivery of the Bonds.
CITY OF RENTON
1055 South Grady Way
Renton, Washington 98055
(425) 430-6858
www.ci.renton.wa.us"
Members of the City Council:
Mayor ............................................................................................................Kathy Keolker
Council Members...i. .................................................................Randall Corman, President
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
Certain Appointed City Officials:
Chief Administrative Officer ........................................................................Jay Covington
Finance and Information Services Administrator ...................................Michael E. Bailey
City Attorney ............................................................................................Lawrence Warren
City Clerk .....................................................................................................Bonnie Walton
Underwriter
D. A. DAVIDSON & CO.
Columbia Center
701 5th Avenue, Suite 3100
Seattle, Washington 98104
888-389-8001
Bond Counsel
Gottlieb, Fisher & Andrews, PLLC
520 Pike Street, Suite 2510
Seattle, Washington 98101
Financial Advisor
Seattle-Northwest Securities Corporation
1420 Fifth Avenue, Suite 4300
Seattle, Washington 98101
Neither the information on the City’s website nor any links from that website, is a part of this Official Statement, and such
information cannot be relied upon to be accurate as of the date of this Official Statement, nor should any such information be
relied upon to make investment decisions regarding the Bonds.
No dealer, broker, salesman or other person has been authorized by the City to give any information or to
make any representations, other than those contained in this official statement, and if given or made, such
other information or representations must not be relied upon as having been authorized by the City. The
information in this official statement was obtained from sources believed to be reliable, but is not guaranteed
as to accuracy or completeness. The information and expressions of opinion herein are subject to change
without notice and neither the delivery of the official statement nor any sale made hereby shall, under any
circumstances, create any implication that there has been no change in the affairs of the City since the date
thereof.
The Underwriter has reviewed the information in the Official Statement in accordance with, as a part of, their
respective responsibilities under the federal securities laws as applied to the facts and circumstances of this
transaction, but the Underwriter does not guarantee the accuracy or completeness of the information. The
information and expressions of opinion herein are subject to change without notice, and neither the delivery of
this Official Statement nor any sale hereunder shall create any implication that there has been no change in the
financial condition or operations of the City described herein since the date hereof. This Official Statement
contains, in part, estimates and matters of opinion that are not intended as statements of fact, and no
representation or warranty is made as to the correctness of such estimates and opinions or that they will be
realized.
The following descriptions of summaries of the bonds and Bond Ordinance and all references to other
documents or materials not claiming to be quoted in full are only brief outlines of some of the provisions and
do not claim to summarize or describe all provisions thereof. Copies of such documents may be obtained
from the issuer, bond counsel or Underwriter.
THE BONDS HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.IN MAKING AN
INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE
ISSUER AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED.
THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE
SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING
AUTHORITIES HAVE NOT CONFIRA/IED THE ACCURACY OR DETERMINED THE ADEQUACY OF
THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
In connection with the offering and issuance of the Bonds, the Underwriter may over-allot or effect
transactions which stabilize or maintain the market price of the Bonds at a level above that which might
otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time.
Certain statements included or incorporated by reference in this Official Statement constitute "forward-
looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995,
section 21E of the United States Securities Act of 1934, as amended, and Section 27A of the United States
Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such
as "plan," "expect, .... estimate," "projection," "budget" or other similar words.
TABLE OF CONTENTS
SUMMARY STATEMENT ......................................................................................................................................1
THE BONDS .............................................................................................................................................................2
Description of the Bonds ...................................................................................................................................2
Registrar and Paying Agent ...............................................................................................................................2
Redemption ........................................................................................................................................................3
Transfer and Exchange of Bonds Upon Discontinuance of Book-Entry System ...............................................3
Purchase of the Bonds ........................................................................................................................................4
Book-Entry System ............................................................................................................................................4
Authorization .....................................................................................................................................................6
Purpose and Use of Proceeds .............................................................................................................................6
Security ..............................................................................................................................................................7
Statutory Debt Limitations .................................................................................................................................7
Property Tax Levy Limitations ..........................................................................................................................8
Initiative and Referendum ................................................................................................................................10
Property Tax Levy Procedures .........................................................................................................................11
Tax Levies .......................................................................................................................................................12
Property Tax Collections .................................................................................................................................13
Trends in Tax Receipts ....................................................................................................................................13
Major Taxpayers ..............................................................................................................................................14
Trends in Assessed Valuations ........................................................................................................................14
Authorized Investments ...................................................................................................................................15
CITY FINANCIAL INFORMATION ............................................................................................................16
Direct Debt and Estimated Overlapping General Obligation Debt ..................................................................16
General Obligation Debt Ratios .......................................................................................................................16
Future Financing ..............................................................................................................................................17
Debt Repayment Record ..................................................................................................................................17
Debt Limitation Calculation .............................................................................................................................17
Schedule of Limited Tax General Obligation Bond Debt Service ...................................................................18
Auditing of City Finances ................................................................................................................................19
The Budgetary Process ....................................................................................................................................19
Historical and Budgeted General Fund Operating Results ...............................................................................20
THE CITY ................................................................................................................................................................22
General Information .........................................................................................................................................22
Form of Local Government ..............................................................................................................................22
Principal City Officials ....................................................................................................................................22
City Employment and Primary Services ..........................................................................................................23
Employee Relations .........................................................................................................................................23
Pension Plans ...................................................................................................................................................23
Risk Management ............................................................................................................................................27
APPROVAL OF BOND COUNSEL .......................................................................................................................27
TAX EXEMPTION .................................................................................................................................................27
OTHER FEDERAL TAX MATTERS .....................................................................................................................28
NO LITIGATION CONCERNING THE BONDS ..................................................................................................28
UNDERWRITING ...................................................................................................................................................29
RATINGS ..................................i .............................................................................................................................29
NO CONFLICTS OF INTEREST ...........................................................................................................................29
COMMITMENT TO PROVIDE CONTINUING DISCLOSURE ..........................................................................30
ADDITIONAL INFORMATION AND MISCELLANEOUS .................................................................................30
APPROVAL OF OFFICIAL STATEMENT ...........................................................................................................30
APPENDIX A - ECONOMIC AND DEMOGRAPHIC INFORMATION ...........................................................A-1
Local Economic Overview .............................................................................................................................A-2
Aircraft Manufacturing - The Boeing Company ...........................................................................................A-2
Technology ....................................................................................................................................................A-3
Transportation ................................................................................................................................................A-3
Fishing, Agriculture and Forest Products .......................................................................................................A-5
Higher Education ...........................................................................................................................................A-5
Services, Tourism, Recreation and Conventions ............................................................................................A-5
Population Trends ..........................................................................................................................................A-7
Trends in Building Permits ............................................................................................................................A-7
Historical Taxable Retail Sales ......................................................................................................................A-8
Maj or Employers - City of Renton and State of Washington ........................................................................A-8
Employment By Major Industry ...................................................................................................................A-10
Labor Force and Unemployment .................................................................................................................A-11
Personal Income Trends ...............................................................................................................................A-11
Earnings By Industry ...................................................................................................................................A-12
APPENDIX B - CONTINUING DISCLOSURE ...................................................................................................B-1
APPENDIX C - FORM OF LEGAL OPINION ....................................................................................................C-1
ii
$20,665,000*
City of Renton, Washington
Limited Tax General Obligation Bonds, 2006
SUMMARY STATEMENT
The following summary is qualified in its entirety by reference to the detailed information appearing
elsewhere in this Official Statement. No person is authorized to detach this Summary Statement from this
Official Statement or to otherwise use it without this entire Official Statement.
ISSUER ..................................The City of Renton (the "City") is located approximately 20 miles
southeast of the City of Seattle and approximately 60 miles northeast of the
City of Olympia, the State’s capital. The City had a population of 58,360
as estimated in 2006 by the State of Washington (the "State") Office of
Financial Management. (See "The City of Renton" herein.)
INTEREST AND
REDEMPTION .....................Interest on the Bonds is payable semi-annually each June 1 and
December 1, commencing December 1,2006. The Bonds maturing on and
after December 1, 2017 are subject to optional redemption prior to
maturity. (See "The Bonds - Description of the Bonds" and "The Bonds -
Redemption" herein.)
AUTHORITY
FOR ISSUANCE ...................The Bonds will be issued in accordance with the provisions of the
Constitution and laws of the State of Washington, particularly chapters
35.37 and 39.46 RCW, and pursuant to Ordinance No. __ of the City
(the "Bond Ordinance"), adopted on or about July 17, 2006, authorizing
the issuance of Bonds. (See "The Bonds - Authorization" herein.)
SOURCE OF
REPAYMENT .......................The Bonds are limited tax general obligations of the City. For as long as
any of the Bonds are outstanding, the City irrevocably has covenanted to
include in its budgets and to make annual levies of taxes within the
constitutional and statutory tax limitations provided by law without a vote
of the qualified voters of the City upon all property within the City subject
to taxation in amounts which, together with any other money legally
available therefor, shall be sufficient to pay the principal and interest on
the Bonds as the same shall become due. The full faith, credit and
resources of the City have been irrevocably pledged to the annual levy and
collection of such taxes and for the prompt payment of such principal and
interest. (See "The Bonds - Security" herein.)
USE OF
PROCEEDS ...........................The proceeds of the Bonds will be used for the purpose of providing for
construction of transportation and utility infrastructure and improvements
(the "Project") and paying costs related to the issuance and sale of the
Bonds. (See "The Bonds - Purpose and Use of Proceeds" herein.)
* Preliminary, subject to change.
THEBONDS
Description of the Bonds
The Bonds will be issued in the aggregate amount of $20,665,000* in fully registered form, will be in the
denomination of $5,000 each or any integral multiple thereof within a single maturity and will be dated
August 1,2006. The Bonds shall mature on December 1 in the years and amounts set forth on the inside cover
hereof.
The Bonds will bear interest from August 1, 2006, or the most recent interest payment date to which interest
has been paid or duly provided for, whichever is later, at the rates per annum set forth on the inside cover
hereof. Interest on each Bond will be calculated on the basis of a 360-day year consisting of twelve 30-day
months, and will be payable semi-annually on June 1 and December 1, commencing December 1,2006, until
the date of maturity or the date of prior redemption of such Bond, whichever occurs first. For so long as the
Bonds are held by DTC in book-entry form, principal and interest payments will be made as described herein
under the heading "The Bonds - Book-Entry System".
Registrar and Paying Agent
The City has adopted the system of registration for the Bonds approved, from time to time, by the State
Finance Committee of the State of Washington. Pursuant to RCW Chapter 43.80, the Committee designates
one or more fiscal agencies for bonds issued within the State of Washington. The Washington State Fiscal
Agent, currently The Bank of New York, in New York, New York, will serve as registrar, paying agent and
transfer agent (the "Registrar") for the Bonds.
In order to meet payment requirement for interest on and principal of the Bonds as the same becomes due and
payable, the City will remit money from the City’s Bond Fund to the Registrar. So long as Cede & Co. is the
registered owner of the Bonds, the principal of and interest on the Bonds are payable by wire transfer to Cede
& Co., as nominee for DTC which, in turn, is to remit such amounts to the Direct Participants for subsequent
disbursement to the Beneficial Owners. See "Book-Entry System" herein. In the event that Cede & Co. is no
longer the registered owner of the Bonds, interest on the Bonds will be paid by check or draft mailed by the
Registrar on or before the interest payment date at the address shown for the registered owners of the Bonds,
(the "Owners") on the registration books ("Bond Register") maintained by the Registrar as of the 15th day of
the month preceding the interest payment date; provided, however, that if so requested in writing by the
Owner of at least $1,000,000 principal amount of Bonds, interest will be paid by wire transfer on the interest
payment date to an account with a bank located in the United States. Principal of the Bonds will be paid to
registered owners upon presentation and surrender of the Bonds at maturity or upon earlier redemption at the
principal corporate trust office of the Registrar in New York, New York, or, under the terms of the current
fiscal agency agreement, for Bonds owned by Owners in the State, upon presentation at any office of Wells
Fargo Bank, N.A. in the State.
2
Redemption
Optional Redemption. The Bonds maturing on or after December 1, 2017 are subject to redemption at the
option of the City on or after December 1, 2016, in whole or in part at any time (maturities to be selected by
the City and by lot within a maturity in such manner as the Registrar shall determine), at any time, at the price
of par plus interest accrued to the date of redemption.
The Bonds in denominations larger than $5,000 may be redeemed in part in any integral multiple of $5,000. If
the Bonds are no longer in book-entry form, the Owner of any Bond redeemed in part shall receive, upon
surrender of such Bond to the Registrar, one or more new Bonds in authorized denominations equal in
principal amount to the unredeemed portion of the Bond so surrendered.
Selection of Bonds to be Redeemed. If fewer than all of the Bonds of like maturity are called for redemption,
the particular Bonds or portions of Bonds within a maturity to be redeemed will be selected by the Registrar
by lot or in such other manner as is determined by the Registrar; provided, that for so long as the book-entry
system is being used, the particular Bonds or portions thereof to be redeemed within a maturity will be
selected by DTC and, in turn, the DTC Participants in such manner as DTC and the DTC Participants may
determine; provided further, however, that the portion of any Bond of a denomination of more than $5,000 to
be redeemed will be in the principal amount of $5,000 or a multiple thereof, and that, in selecting portions of
such Bonds for redemption, the Registrar, DTC and the DTC Participants will treat each such Bond as
representing that number of Bonds of a $5,000 denomination which is obtained by dividing the principal
amount of such Bond to be redeemed in part by $5,000. While the Bonds are in book-entry form, the
Registrar shall give, or cause to be given, notice of a call for redemption of any bond to DTC, in accordance
with the Letter of Representations between the City and DTC. The City cannot and does not give any
assurances that DTC, its direct participants or others will distribute any redemption notices to the beneficial
owners or that they will do so on a timely basis. See "The Bonds - Book-Entry System" below for a discussion
of how redemption notices will be given by DTC to the beneficial owners of the Bonds. If the Bonds are no
longer in book-entry form, the Bond Ordinance requires that such notice be sent to Owners of the Bonds to be
redeemed no more than 60 days, nor less than 30 days, before the scheduled redemption date.
Pursuant to the City’s continuing disclosure undertakfing, the City is required to provide timely notice of bond
calls to each NRMSIR (or MSRB) and to any SID. See "Commitment to Provide Continuing Disclosure"
herein for definitions of the terms "NRMSIR," "MSRB" and "SID" and a description of the City’s
undertaking to provide certain notices.
Effect of Redemption. If notice of redemption to the Owners has been given and the City has set aside
sufficient money for the payment of all Bonds call for redemption, the Bonds shall cease to accrue interest
after the redemption date and the Bonds called for redemption shall not be deemed to be outstanding under the
Bond Ordinance.
Transfer and Exchange of Bonds Upon Discontinuance of Book-Entry System
So long as the Bonds are in book-entry only form, the beneficial ownership of the Bonds may only be
transferred in the records established and maintained by DTC. Upon discontinuance of the book-entry system,
the Bonds may be transferred by Owners upon completion of the assignment form on the Bond(s) in form and
substance satisfactory to the Registrar and delivery of the Bond(s) to be transferred to the principal
3
corporate trust office of the Registrar for cancellation and re-issuance. Upon such surrender, the Registrar will
cancel the surrendered Bonds and deliver to the new Owner a new Bond or Bonds of the same maturity and
interest rate and for the same aggregate principal amount. Upon discontinuance of the book-entry system, any
Bond may be surrendered at the principal corporate trust office of the Registrar and exchanged, without
charge, for an equal aggregate principal amount of Bonds, in any authorized denomination. The Registrar is
not required to transfer or exchange Bonds during the 15 days preceding any principal or interest payment
date.
Purchase of the Bonds
The City has reserved the right to purchase any of the Bonds on the open market at any time and at any price.
Bonds purchased by the City will be canceled.
Book-Entry System
When the Bonds are issued, ownership interest will be available to purchasers only through a book-entry
system (the "Book-Entry System") maintained by DTC or such other depository institution designated by the
City pursuant to the Bond Ordinance. If the Bonds are removed from the Book-Entry System and delivered to
the Owners in physical form, as described below, the discussion herein of the Book-Entry System will not
apply. The following information has been provided by DTC, and the City makes no representation as to the
accuracy or completeness thereof.
The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the
Bonds. The Bonds will be issued as fully registered securities registered in the name of Cede & Co.
(DTC’s partnership nominee) or such other name as may be requested by an authorized representative
of DTC. One fully registered bond certificate will be issued for each maturity of the Bonds, each in
the aggregate principal amount of such maturity, and will be deposited with DTC.
DTC, the world’s largest depository, is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a"clearing corporation" within the meaning of the New York
Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 2
million issues of U.S. and non-U.S, equity issues, corporate and municipal debt issues, and money
market instruments from over 85 countries that DTC’s participants ("Direct Participants") deposit with
DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other
securities transactions in deposited securities through electronic computerized book-entry transfers and
pledges between Direct Participants’ accounts. This eliminates the need for physical movement of
securities certificates. "Direct Participants" include both U.S. and non-U.S, securities brokers and
dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a
wholly-owned subsidiary of The Depository Trust & Clearing Corporations ("DTCC"). DTCC, in
turn, is owned by a number of Direct Participants of DTC and Members of the National Securities
Clearing Corporation, Government Securities Clearing Corporation, MBS Clearing Corporation, and
Emerging Markets Clearing Corporation, (NSCC, GSCC, MBSCC, and EMCC, also subsidiaries of
DTCC), as well as by the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and
4
o
the National Association of Securities Dealers, Inc. Access to the DTC system is also available to
others, such as U.S. and non-U.S, securities brokers and dealers, banks, and trust companies, and
clearing corporations that clear through or maintain a custodial relationship with a Direct Participant,
either directly or indirectly ("Indirect Participants"). DTC has Standard and Poor’s highest rating:
AAA. The DTC rules applicable to its Participants are on file with the Securities and Exchange
Commission. More information about DTC can be found at www.dtcc.com.
Purchases of Bonds under the DTC system must be made by or through Direct Participants, which will
receive a credit for the Bonds on DTC’s records. The ownership interest of each actual purchaser of
each Bond ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants’
records. Beneficial Owners are, however, expected to receive written confirmation from DTC of their
purchase, but Beneficial Owners are expected to receive written confirmations providing details of the
transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant
through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in
the Bonds are to be accomplished by entries made on the books of Direct or Indirect Participants
acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in Bonds, except in the event that use of the book-entry system for the Bonds
is discontinued.
To facilitate subsequent transfers, all Bonds deposited by Participants with DTC are registered in the
name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an
authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name
of Cede & Co., or such other DTC nominee, do not effect any change in beneficial ownership. DTC
has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records reflect only the
identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not
be the Beneficial Owners. The Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
Conveyances of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
Redemption notices, if any, shall be sent to DTC. If less than all of the Bonds within an issue are
being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct
Participant in such issue to be redeemed.
Neither DTC nor Cede & Co. (nor such other DTC nominee), will consent or vote with respect to
Bonds unless authorized by a Direct Participant in accordance with DTC’s Procedures. Under its
usual procedures, DTC mails an Onmibus Proxy to the City as soon as possible after the record date.
The Omnibus Proxy assigns Cede & Co.’s consenting or voting fights to those Direct Participants to
whose accounts Bonds are credited on the record date (identified in a listing attached to the Omnibus
Proxy).
Redemption proceeds, distributions, and dividend payments on the Bonds will be made to Cede & Co.,
or such other nominee as may be requested, by an authorized representative of DTC. DTC’s practice
is to credit Direct Participants’ accounts, upon DTC’s receipt of funds and corresponding detail
information from the City on the payable date in accordance with their respective holdings shown on
5
10.
11.
DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing
instructions and customary practices, as is the case with securities held for the accounts of customers
in bearer form or registered in "street name," and will be the responsibility of such Participant and not
of DTC or the City, subject to any statutory or regulatory requirements as may be in effect from time
to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or
such other nominee as maybe requested by an authorized representative of DTC) is the responsibility
of the City, disbursement of such payments to Direct Participants shall be the responsibility of DTC,
and disbursement of such payments to Beneficial Owners shall be the responsibility of Direct and
Indirect Participants:
DTC may discontinue providing its services as securities depository with respect to the Bonds at any
time by giving reasonable notice to the City. Under such circumstances, in the event that a successor
securities depository is not obtained, Bond certificates are required to be printed and delivered.
The City may decide to discontinue use of the system of book-entry transfers through DTC (or a
successor securities depository). In that event, Bond certificates will be printed and delivered.
The information in this section concerning DTC and DTC’s book-entry system has been obtained from
sources that the City believes to be reliable, but the City takes no responsibility for the accuracy
thereof.
Authorization
The Bonds will be issued pursuant to the provisions of the Constitution and laws of the State of Washington,
particularly chapters 35.37 and 39.46 RCW and Ordinance No. __ (the "Bond Ordinance"), adopted by the
City Council on or about July 17, 2006.
Purpose and Use of Proceeds
The proceeds of the Bonds will be used for the purpose of paying the costs of the Project and costs of the
issuance and sale of the Bonds.
The Project will generally consist of improvements to Logan Avenue North, Park Avenue North, North 8t~
Street and North 10tu Street all in relationship to private investments made to develop properties in the area
into a regional retail project. In addition, proceeds will be used to augment the construction budget of
roadway improvements on 217t~ and Strander Boulevard.
6
The estimated sources and application of funds are shown in the table that follows.
Sources of Funds1:
Par Amount of the Bonds .......................................................................
Original Issue Premium ..........................................................................
Total Sources of Funds ........................................................................$
$20,665,000
Application of Funds~:
Deposit to the Construction Fund ................................................................$
Costs of Issuance2..i .....................................................................................
Total Application of Funds $
I Preliminary, subject to change.
2 Includes the Underwriter’s discount, municipa! bond insurance premium, Bond Counsel fees, rating agency fees, registration costs, printing
expenses and any miscellaneous costs.
Security
General Ad VMorem Tax Pledge. The Bonds are limited tax general obligations of the City. Unless the
principal of an interest on the Bonds are paid from other sources, so long as the Bonds are outstanding, the
City has covenanted in the Bond Ordinance to include in its budgets and to make annual levies of taxes within
the constitutional and statutory limitations provided by law without a voted of the qualified voters of the City
upon all property within the City subject to taxation in amounts which, together with other money legally
available and to be used therefor, will be sufficient to pay the principal of and interest on the Bonds. The full
faith, credit and resources of the City have been irrevocably pledged for the annual levy and collection of
those taxes and the prompt payment of such principal and interest.
The Bonds are not obligations of King County, the State of Washington or any municipal corporation
other than the City.
Limitation on Sources of Payment for the Bonds. Limited tax general obligation bonds, such as the Bonds,
are payable solely from amounts on deposit in the City’s Bond Fund, together with any other money of the
City legally available to pay debt service on such bonds. The City is not authorized to levy any additional or
excess tax for purposes of repaying its limited tax general obligation bonds. The primary source of funds to
repay such bonds are the City’s regular property tax and various excise taxes. See "The Bonds - Property Tax
Limitations" and "The Bonds - Property Tax Levy Procedure" herein for a discussion of the City’s regular
property tax collection procedures and limitations thereon. Because regular property tax revenues are used to
operate City government, a pledge to repay limited tax general obligation bonds directly affects a City’s
operating budget. Consequently, any money budgeted to pay debt service on limited tax general obligation
bonds is necessarily unavailable for other City services.
Statutory Debt Limitations
The power of the City to contract debt of any kind is controlled and limited by state law. All debt must be set
forth in accordance with detailed budget procedures and paid out of identifiable receipts and revenues. The
budget must be balanced for each fiscal year. It is unlawful for an officer or employee of the City to incur
liabilities in excess of budgetary appropriations.
7
The amount of indebtedness that a city may legally incur is limited by the Constitution and laws of the State.
For State law purposes, "debt" generally includes any unconditional obligation that is generally payable from
and secured by a pledge of tax revenues.
The debt limitations applicable to cities are set forth in terms of debt for general purposes and debt for special
purposes. Without the approval of its voters, a city may incur debt in the aggregate amount of up to 1 ½% of
the city’s assessed valuation. Upon the approval of 60% of the city’s voters at an election at which 40% of the
number of those who voted at the last general election cast a ballot, a city can incur total indebtedness for
general purposes, including non-voted debt, in an amount not to exceed 2 ½% of the city’s assessed valuation.
In addition to the indebtedness authorized for general purposes, a city may incur debt for: (i) water, artificial
light and sewers in an amount not exceeding 2 ½% of the city’s assessed valuation; and (ii) open space, parks
and economic development in an amount not to exceed 2 ½% of the city’s assessed valuation. Before
incurring such additional indebtedness for special purposes, the city must receive the approval of 60% of its
voters at an election at which 40% of the number of those who voted at the last general election cast a ballot.
Accordingly, the aggregate general obligation indebtedness a city may incur for general and special purposes
is equal to 7 ½% of its assessed valuation. For a discussion of the outstanding debt of the city, see "City
Financial Information - Debt Limit Calculation’’ herein.
In determining the total amount of indebtedness outstanding, a city is allowed to offset certain assets against
the aggregate amount of debt outstanding. Such assets include taxes and levies of the current year,
uncollected taxes that are not delinquent for longer than six years, and cash on hand and received for general
business purposes.
Property Tax Levy Limitations
The Bonds are secured by money received by the City from its regular property tax levy. There is no authority
for the City to levy taxes in excess of the regular property tax levy to pay principal of and interest on limited
tax general obligation bonds, such as the Bonds. Nonvoted regular property tax levies are subject to two
limitations more specifically described below. Regular property tax levy receipts may be used for the payment
of the principal of and interest on nonvoted general obligations and for any lawful City purpose. Under
existing laws and circumstances, none of the property tax limitations currently affect the ability of the City to
levy regular property taxes at rates sufficient to pay the debt service on its outstanding obligations.
Information relating to regular property tax limitations is based on existing statutes, constitutional provisions
and circumstances. Changes in the same could alter adversely the impact of other interrelated tax limitations
on the City.
City Maximum Rate Limitation. The regular property tax levy by any city cannot exceed $3.60 per $1,000 of
assessed value. Pursuant to RCW 84.52.043, cities may levy, without a vote of the residents residing therein,
a maximum of $3.375 per thousand for general city purposes (the "regular levy"). A city with full-time
firemen may levy an additional $0.225 per thousand to fund the city’s Fireman’s Pension Fund (RCW
41.16.060), thus creating a maximum annual levy rate of $3.60 per thousand dollars of assessed valuation.
The City is currently levying $3.04482 per thousand dollars of taxable assessed valuation for its regular levy
for collection year 2006. See "Certain City Financial Information - Tax Levies" herein for a summary of
historical tax levy rates in the City.
8
Limit Factor. Chapter 84.55 RCW places a limitation on the amount of tax levies by individual taxing
districts, including the City, defined by a statutorily defined "limit factor." All municipal ’5-egular property
tax" levies are subject to this limitation. The law limits a municipality’s regular tax levy to an amount equal
to the highest property tax levy of the three most recent years multiplied by a "limit factor" plus a full value
adjustment for new construction. Substantively, this means that the regular property tax levy of a city must be
set so that the property taxes payable in a given year (excluding new construction, improvements and State-
assessed property) will not exceed the amount levied by the city in the highest of the three most recent years
multiplied by the limit factor. Revenue generated by the regular property tax levy on new construction is not
affected by the levy limit.
The limit factor for the City is defined to be the lesser of 101% or 100% plus the previous year’s inflation rate,
but if the inflation rate is less than 1%, the City Council could increase the limit factor to 101% upon a finding
of substantial need. The limit factor may also be increased, regardless of inflation, if such increase is
authorized by the City Council upon a finding of substantial need and is also approved by the voters at a
general or special election within the City. Such election must be held less than twelve months before the date
on which the proposed levy will be made and any tax increase cannot be greater than described under the
heading "City Maximum Rate Limitation". A majority of those voting would be required for approval. The
new limit factor will be effective for taxes collected in the following year only; however, the resulting levy
sets a new threshold upon which the limit factors are computed.
The limit factor in Chapter 84.55 RCW was approved by voters in 2001 as Initiative 747. On June 13, 2006,
a King County Superior Court judge struck down Initiative 747 as invalid. The State Attorney General’s
Office has stated that it plans to appeal the decision. However, it is unknown whether the ruling will be
appealed and, if it is, the City cannot predict the outcome of such appeal.
See "The Bonds - Tax Levies" herein for a summary of the City’s historical tax levy rates.
$5.90/$1,000 Aggregate Non-Voted Levy Limitation. RCW 84.52.043 (2) imposes an aggregate limitation on
non-voted tax levies by all taxing districts, except the State, ports and public utility districts, of $5.90/$1,000
of assessed value. This statute also gives certain "senior" taxing districts, such as the City, a priority on the
permissible aggregate levy up to their maximum authorized levies as follows:
Incorporated Areas
Senior Maximum The City’s
Taxing Districts LeW Rate 2006 Levy
CountyI $1.800 $1.32869
City 3.375 3.04482
City Pension2 0.225 0.22500
Total $5.4003 $4.59851
Pursuant to RCW 84.52.043(1), a county may increase its levy from $1.80 to a rate not to exceed $2.475 for general countypurposes if
(i) the total levies for both the county and any road district within the county do not exceed $4.05 and (ii) no other taxing district (such
as the City) has its levy reduced as a result of the increased county levy.
RCW 14.16.060. Not levied by cities incorporated after 1970.
The remaining $0.50/$1,000 is available for various other taxing and junior taxing districts, as described below.
9
Limitations on the Aggregate Taxes Levied for Junior Taxing Districts. The City is not a junior taxing
district; however, the following information is provided to further describe property tax laws in Washington.
In addition to the $3.60 levy rate limitation for cities and the 101% limitation described above, the constitution
and laws of the State impose other limitations on regular property taxes (as opposed to voter-approved excess
property taxes). For instance, the aggregate of all tax levies upon real and personal property by the State and
all taxing districts cannot exceed, in any year, one percent of the true and fair value of such property. In
addition, the aggregate regular levies of all taxing districts, other than the State, cannot exceed $5.90 per
$1,000 assessed valuation, unless certain limited exceptions apply. If either limitation on the aggregate
regular property tax is exceeded in a year, the county assessor must reduce the levy rates for various junior
taxing districts (not including the State, counties or cities) on a pro rata basis determined by statute. The City
is not a junior taxing district.
Uniformity Requirement. Article VII, Section 1 of the Washington Constitution requires that property taxes
be levied at a uniform rate upon the same class of property within the territorial limits of a taxing district
levying such taxes. It is possible because of different overlapping taxing districts in different areas of the City
that the maximum permissible levy might vary within the City. In that event, to comply with the
constitutional requirement for uniformity of taxation, the lowest permissible rate for any part of the City
would be applied to the entire City.
Initiative and Referendum
Under the State Constitution, the voters of the State have the ability to initiate legislation and modify existing
legislation through the powers of initiative and referendum, respectively. The initiative power in Washington
may not be used to amend the State Constitution. Initiatives and referenda are submitted to the voters upon
receipt of a petition signed by at least eight percent (initiative) and four percent (referenda) of the number of
voters registered and voting for the office of Governor at the preceding regular gubernatorial election. Any
law approved in this manner by a majority of the voters may not be amended or repealed by the Legislature
within a period of two years following enactment, except by a vote of two-thirds of all members elected to
each house of the Legislature. After two years, the law is subject to amendment or repeal by the Legislature in
the same manner as other laws.
Future Initiative Legislation. Tax and fee initiative measures have been and may be filed, but it cannot be
predicted whether any such initiatives might gain sufficient signatures to qualify for submission to the
Legislature and/or the voters or, if submitted, whether they ultimately would be approved.
There are currently two initiative measures that are in the process of gathering signatures to qualify for
submission to the Legislature and/or voters, with the deadline for the signatures set for 5:00 pm (PT) on July
7, 2006. Proposed Initiative 933 would require that a government to provide compensation when such
government regulation damages the use or value of private property, among other things. Proposed Initiative
917 would cap motor vehicle registration charges at $30 and repeal taxes and fees exceeding the $30 limit,
among other things. Neither of the above-proposed initiatives will impact the levy and collection of property
taxes by the City, which are pledged to the payment of the principal of and interest on the Bonds. The City is
unable to predict if such initiatives will qualify for submission to the voters or, if submitted, whether they
would be approved by the voters. As of the date of this Official Statement the City is uncertain of the
potential impacts such initiatives would have on the City.
10
Property Tax Levy Procedures
The Bonds are payable from any money legally available for such purposes, including taxes levied generally
with limitation as to rate or amount, as described under the caption "The Bonds" - "Security" above. A
significant portion of the City’s operating revenues are derived from regular property taxes levied upon the
taxable property within the City’s boundaries. The City is limited in its ability to levy such taxes by various
constitutional and statutory provisions.
The City does not believe that "these existing property tax limitations will have an impact on the City’s ability
to levy and collect taxes for the repayment of the Bonds.
Valuations and Assessments of Property for Taxation Purposes. The King County Assessor (the
"Assessor") determines the value of all real and personal property throughout King County (the "County"),
which is subject to ad valorem taxation. The Assessor is an elected official whose duties and methods of
determining value are prescribed and controlled by statute and by detailed regulations promulgated by the
State Department of Revenue. For tax purposes, the assessed value of property is set at 100% of its true and
fair value as of January 1 of each year. All taxable property is subject to revaluation at least once every four
years and to an on-site appraisal at least once every six years. The property is listed by the Assessor on a tax
roll at its current assessed value and the tax roll is filed in the Assessor’s office. The Assessor’s determination
is subject to revisions by the County Board of Equalization and, for certain property, subject to further
revisions by the State Board of Equalization. After all administrative procedures are completed, the City
receives the Assessor’s final certificates of assessed value of property within the County.
Property Tax Collection Procedures. Property taxes are levied in specific amounts, and the rate for all taxes
levied for all taxing districts in the County (including the City) are determined, calculated and fixed by the
Assessor based upon the assessed valuation of the property within the various taxing districts. The Assessor
extends the tax levied within each taxing district on a tax roll that contains the total amounts of taxes levied
and to be collected and assigns a tax account number to each tax lot. The tax roll is delivered to the King
County Finance Department, which is responsible for the billing and collection of taxes due for each account.
All taxes are due and payable on April 30 of each tax year, but if the amount due from a taxpayer exceeds fifty
dollars, one-half may be paid then and the balance no later than October 31 of that year (except that the half to
be paid on April 30 may be paid at any time prior to October 31 if accompanied by penalties and interest
accrued until the date of payment).
The method of giving notice of payment of taxes due, the King County Finance Department’s accounting for
the money collected, the division of the taxes among the various taxing districts, notices of delinquency, and
collection procedure are all covered by detailed statutes.
Tax Liens and Foreclosure. Property taxes and all charges and expenses relating to the taxes constitute a
statutory lien on the property taxed. The lien attaches to the property from and including January 1 in the year
in which the tax is levied, and is discharged only when the taxes are paid. In other respects, and subject to the
"Homestead Exemption," the lien for delinquent property taxes is prior to all other liens or encumbrances of
any kind on real or personal property subject to taxation. The courts have not decided whether the Homestead
Law (chapter 6.13 RCW) may give the occupying homeowner a right in the forced sale of the family residence
for delinquent general property taxes to retain the first $40,000 of proceeds of any sale upon foreclosure (see
Algona v. Sharp, 30 Wn. App. 837, 638 P.2d 627 (1982), holding the homestead right superior to liens for
local improvement district assessments).
11
By law, the King County Finance Department must commence in superior court foreclosure of a tax lien on
real property after three years have passed since the first delinquency. The King County Finance Department
must sell the property to the highest and best bidder for cash upon entry of the order of foreclosure. The
minimum bid allowable is the total amount of the taxes, interest, penalty and costs due. To the extent property
is stricken to the City in a foreclosure sale, that property is exempt from taxation for so long as it is held by the
City. A property owner may redeem his property at any time prior to the foreclosure sale by paying the King
County Finance Department the amount of the certificate of delinquency and all taxes, interest and costs
accruing after the certificate of delinquency is issued, together with interest on such amount at the rate of 12%
per annum.
Tax Levies
The following tables show the representative ad valorem tax levies in dollars per $1,000 of assessable value
for property located in the City for the tax years shown. The total shown is equal to the aggregate number of
levies assessed against all property located in the City. See "The Bonds - Property Tax Levy Limitations"
herein for a description of the City’s maximum levy rate limitation of $3.60 per $1,000 of assessed value.
Tax Ye
Taxing Entity 2002 2003 2004
State of Washington $2.99 $2.90 $2.76
King County 1.45 1.35 1.43
The City - Regular Levy 3.26 3.19 3.16
The City- Excess Levy 0.09 0.09 0.08
King County Library 0.53 0.55 0.54
Port of Seattle 0.19 0.26 0.25
Road 1.73 0.00 0.00
King County Hospital District 2 0.36 0.34 0.34
Renton School District 3.11 2.99 3.49
Fire District No. 10-1 0.09 0.08 0.08
Total $13.80 $11.75 $12.13
ars
2005 2006
$2.69 2.50
1.38 1.33
3.15 3.04
0.08 0.07
0.53 0.53
0.25 0.23
0.00 0.00
0.59 0.54
3.99 3.96
0.07 0.06
$12.73 $12.26
Source: King County Assessor’s Office
12
Property Tax Collections
Set forth in the following table are the total real and personal property and special tax levies and collections
for the City for the fiscal years 2001 through 2005. The following is provided to show recent trends in the
collection of property taxes within the City. Property taxes are due and payable on April 30 of each year
succeeding the levy. The entire tax or first half must be paid on or before April 30, and if not paid on a timely
basis, the total amount becomes delinquent on May 1. The second half of the tax is payable on or before
October 31, becoming delinquent November 1. The City applies delinquent taxes collected to the year in
which they are collected and not the year in which they were levied.
Current Taxes Percent Current
Tax Total Adjusted Collected in Collections In Total Taxes Percent Total
Year Tax Levy Year Levied Year Levied Collected~Collected~
2006 $22,209,409 $14,400,7352 64.8%2 n/a n/a
2005 21,654,069 21,632,695 99.9 $21,681,415 100.1%
2004 20,451,011 20,184,238 98.7 20,506,186 100.3
2003 19,486,858 19,149,258 98.3 19,430,558 99.7
2002 18,581,814 18,285,908 98.4 18,561,605 99.9
2001 16,967,683 16,677,882 98.3 16,942,461 99.9
Includes the collection of current and delinquent taxes, penalties and interest.
Current tax collections for tax year 2006 are as of June 30, 2006.
Source: The City
Trends in Tax Receipts
Set forth in the following table is a breakdown of the taxes received by the City for all funds for the past five
fiscal years. Other taxes include leasehold excise tax, real estate excise tax and interest and penalties on real
and personal property taxes.
Year Property Taxes Sales Taxes Utility Taxes Other Taxes
2005 $21,618,590 $18,692,911 $9,585,293 $8,227,650
2004 20,110,105 18,071,140 8,957,389 8,286,408
2003 19,352,806 17,334,831 8,952,000 6,512,444
2002 18,381,694 16,431,456 8,669,865 6,418,832
2001 16,677,882 16,724,786 10,348,682 6,368,215
Source: The City
13
2.
3.
5.
6.
8.
4.
9.
7.
10.
Major Taxpayers
The following table lists the ten largest taxpayers within the City based upon their 2006 assessed valuation.
Taxpayer
The Boeing Company~
PACCAR
Puget Sound Energy
AMB Property Corporation
Business
Aerospace & Computer Science
Heavy Manufacturing
Utility
Commercial Property Owners
2006 Assessed % of 2006
Valuation Assessed Valuation
$561,274,026 7.7%
106,646,760 1.5
79,178,508 1.1
43,670,400 0.6
Renton Properties LLC
Avalon Bay Communities, Inc.
Qwest
WalMart
Fred Meyer Stores, Inc.
Walton Renton Investors III
Total
Property Management 39,403,400 0.5
Apartment Building 34,169,000 0.5
Telecommunications 29,746,472 0.4
Retailer 27,877,700 0.4
Retailer 27,762,178 0.4
Commercial Property Owners 23,746,800 0.3
$973,475,244 13.3%
~ See "Appendix A- Economic and Demographic Information - Aircraft Manufacturing - The Boeing Company" for a further
description of the Boeing Company.
Source: King County Assessor’s Office
Trends in Assessed Valuations
Set forth in the following table are the historical and current assessed valuations of taxable property located
within the City. Assessed valuation within the City is based upon 100% of estimated actual valuation,
excluding senior citizens tax base.
Tax Total City Percent
Year Assessed Valuation Change
2006 $7,334,476,542 9.51%
2005 6,697,750,148 5.10
2004 6,372,632,122 6.50
2003 5,983,832,546 6.97
2002 5,593,880,488 N/A
Source: King County Assessor’s Office
14
Authorized Investments
General Chapter 35.39 RCW limits the investment by cities and towns of its inactive funds or other funds in
excess of current needs to the following authorized investments: United States bonds; United States
certificates of indebtedness; bonds or warrants of the State and any local government in the State; its own
bonds or warrants of a local improvement district which are within the protection of the local improvement
guaranty fund law; and any other investment authorized by law for any other taxing district or the State
Treasurer. Under chapter 43.84 RCW, the State Treasurer may invest in non-negotiable certificates of deposit
in designated qualified public depositories; in obligations of the U.S. government, its agencies and wholly
owned corporations; in bankers’ acceptances; in commercial paper; in the obligations of the federal home loan
bank, federal national mortgage association and other government corporations subject to statutory provisions
and may enter into repurchase agreements. Utility revenue bonds and warrants of any city and bonds or
warrants of a local improvement district are also eligible investments (RCW 35.39.030).
Money available for investment may be invested on an individual fund basis or may, unless otherwise
restricted by law, be commingled within one common investment portfolio. All income derived from such
investment may be either apportioned to and used by the various participating funds or for the benefit of the
general government in accordance with city ordinances or resolutions. Funds derived from the sale of bonds
or other instruments of indebtedness will be invested or used in such manner as the authorizing ordinances,
resolutions or bond covenants may lawfully prescribe.
Bond Proceeds. In addition to the eligible investments discussed above, bond proceeds may also be invested
in mutual funds with portfolios consisting of U.S. government and guaranteed agency securities with average
maturities of less than four years; municipal securities rated in one of the four highest categories; and money
market funds consisting of the same, so long as municipal securities held in the fund(s) are in one of the two
highest rating categories of a nationally recognized rating agency. Bond proceeds may also be invested in
shares of money market funds with portfolios of securities otherwise authorized by law for investment by local
governments (RCW 39.59.030). At this time, there are no funds that qualify under State law for this type of
investment.
[The remainder of this page intentionally left blank.]
15
CITY FINANCIAL INFORMATION
Direct Debt and Estimated Overlapping General Obligation Debt
The following information sets forth the general obligation indebtedness of the City as of January 1, 2006,
(adjusted to reflect the issuance of the Bonds) and of taxing entities with boundaries that overlap with the
City.
Direct General Obligation Debt:
Voted General Obligation Bonds Outstanding ...............................................$1,440,000
Non-Voted General Obligation Bonds Outstanding ......................................26,831,734
The Bonds (Non-Votedy .............................................................................20,665,0005
Installment Contract ......................................................................................81,218
Direct Debt of the City ..............................................................................................................$49,017,952~
Estimated Overlapping General Obligation Debt:
General Obligation
Bonds
Outstanding
Outstanding Debt Chargeable to
Property Within the City
Percent Amount
School District No. 403 (Renton)
School District No. 411 (Issaquah)
School District No. 415 (Kent)
Port of Seattle
King County Library
King County
Fire District No. 10-1
Total Estimated Overlapping Debt
Total Direct Debt
Total Direct and Overlapping Debt
$212,085,000 55.30%$117,283,005
198,075,000 1.17 2,317,478
221,636,400 0.01 22,164
434,555,000 2.71 11,776,441
86,295,000 0.36 310,662
900,160,000 2.71 24,394,336
2,080,000 0.36 7,401
$156,111,487
49,017,9521
$205,129,439
~ Preliminary; subject to change. Total Direct Debt of the City includes Voted and Non-Voted General Obligation Bonds
outstanding. See "City Financial Information - Schedule of Limited Tax General Obligation Bond Debt Service" herein.
General Obligation Debt Ratios
2006 Population Estimate .....................................................................................................................58,360
2006 Assessed Valuation ........................................................................................................$7,334,476,542
Assessed Valuation Per Capita ..........................................................................................................$125,676
Direct Debt Per Capita .............................................................................................................................$840
Direct and Estimated Overlapping Debt Per Capita ..............................................................................$3,515
Direct Debt to Assessed Valuation ......................................................................................................0.67%~
Direct and Estimated Overlapping Debt to Assessed Valuation ..........................................................2.80%1
1 Preliminary; subject to change. Total Direct Debt of the City includes Voted and Non-Voted General Obligation Bonds
outstanding. See "City Financial Information - Direct Debt and Estimated Overlapping General Obligation Debt" and "City
Financial Information- Schedule of Limited Tax General Obligation Bond Debt Service" herein.
16
Future Financing
The City anticipates that it may from time to time issue additional limited and unlimited tax general obligation
bonds to finance capital improvements. However, the City, as of the date of this Official Statement, does not
anticipate the need to incur additional general obligation debt within the next 12 months.
Debt Repayment Record
The City has never defaulted on a payment of principal or interest on any of its general obligation bonds.
Furthermore, the City has never issued refunding bonds for the purpose of avoiding an impending default on
its general obligation bonds.
Debt Limitation Calculation
In Washington there is a statutory limit on the amount of bonded, or other, indebtedness a city may incur.
(See "The Bonds - Statutory Debt Limitations" herein.) The following chart sets forth the remaining general
obligation debt capacities of the City as of January 1,2006, adjusted to reflect the issuance of the Bonds. The
2006 assessed valuation of the City is $7,334,476,542.
I. General Purposes:
A. Non-Voted Debt Capacity (1.50% of 2006 Valuation) ...................................$1 i0,017,148
Less: Non-Voted General Obligation Debt Outstanding (including the Bonds) 47,496,7341
Less: Loans ......................................................................................................1,989,2172
Remaining Capacity for Non-Voted General Purposes ....................................................$60,.531,1971
B. Total General Debt Capacity (2.50% of 2006 Valuation) ...............................$183,361,914
Less: Voted General Obligation Debt ..............................................................1,440,000
Less: Non-Voted General Obligation Debt Outstanding (including the Bonds) 47,496,734~
Less: Other ......................................................................................................1,989,2172
Remaining Capacity for Total General Debt ....................................................................$132,435,963~
II. Utility Purposes:
Voted Debt Capacity (2.50% of 2006 Valuation) ................................................$183,361,914
Less: Voter Approved Bonds Outstanding .................................................0
Remaining Capacity for Utility Purposes .........................................................................$183,361,914
III. Parks and Open Space Purposes:
Voted Debt Capacity (2.50% of 2006 Valuation) ................................................$183,361,914
Less: Voter Approved Bonds Outstanding .................................................0
Remaining Capacity for Parks and Open Space .............................................................$183,361,914
i Preliminary; subject to change.
2 These amounts represent contractual commitments for the City’s participation in the Valley Communications Emergency Radio
System debt, including certificates of participation.
17
Schedule of Limited Tax General Obligation Bond Debt Service
In addition to the Bonds, the City has Limited Tax General Obligation Bonds outstanding in the total principal
amount of $26,831,734 ($188,715 of Limited Tax General Obligation Bonds, 1996; $3,973,019 of Limited
Tax General Obligation Bonds, 1997; $19,195,000 of Limited Tax General Obligation and Refunding Bonds,
2001; and $3,475,000 in Limited Tax General Obligation Bonds, 2002) and an installment contract
outstanding in the principal amount of $81,218. Set forth in the following table is the aggregate debt service
schedule for the outstanding limited tax general obligation bonds and the Bonds as of the date of issuance of
the Bonds. Interest figures have been rounded in some cases.
The City also has Unlimited Tax General Obligation Bonds, outstanding in the principal amount of
$1,440,000 with a final maturity in 2009, not shown below.
Installment Contract
Outstanding
LTGO Bonds The Bonds~
Year Princ~al
2006 $31,405
2007 32,838
2008 16,975
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
Total $81,218
Interest
$3,315
1,882
384
Principal Interest
$888,946
918,926
895,575
985,000
1,520,000
1,575,000
$1,625,119
1,656,639
1,692,565
1,599,528
1,070,463
1,009,833
946 833
862 245
773 940
680 715
582 606
479 337
370,671
287,033
Toml DebtServicePrincipal Interest
$308,303 $2,857,088
924,910 3,535,195
$625,000 924,910 4,155,409
650,000 899,910 4,134,438
675,000 873,910 4,139,373
705,000 846,910 4,136,743
735,000 816,948 4,153,780
765,000 785,710 4,132,955
795,000 753,198 4,132,138
830,000 719,410 4,130,125
870,000 682,060 4,129,665
905,000 642,910 4,122,248
945,000 603,995 3,534,665
985,000 562,888 3,539,920
1,030,000 519,055 3,547,555
1,080,000 472,705 3,546,205
1,125,000 423,565 1,847,815
1,180,000 371,815 1,551,815
1,235,000 316,945 1,551,945
1,290,000 258,900 1,548,900
1,350,000 202,140 1,552,140
1,410,000 138,015 1,548,015
1,480,000 71,040 1,551,040
$13,120,151 $73,079,170
198,500
108,500
14,250
1,655,000
1,720,000
1,810,000
1,900,000
1,995,000
2,095,000
1,615,000
1,705,000
1,800,000
1,885,000
285,000
$5,581 $25,248,447 $13,958,777 $20,665,000
Preliminary, subject to change. The estimated debt service schedule for the Bonds is calculated based on an average interest rate
of 4.50%.
18
Auditing of City Finances
Cities and counties of the State must comply with the Budgeting, Accounting, and Reporting System
("BARS") prescribed by the Office of the State Auditor as authorized under RCW 43.09.230 and 43.09.230.
State laws also provide for annual independent audits by the Office of the State Auditor and require timely
submission of annual financial reports to the State Auditor for review. The financial system of the City
incorporates a system of financial and administrative controls that ensure the safeguarding of assets and the
reliability of financial reports and consequently are designed to provide reasonable assurance that transactions
are executed in accordance with management authorization, recorded in conformity with generally accepted
accounting principles ("GAAP") applicable to governmental entities, that there exists accountability of and
control over assets and obligations, and that sufficient reporting and review exists to provide adequate
information for analysis and comparability of data. Internal control is an area of audit by the State Auditor, as
well, and City management receives and takes action upon recommendations made by the State Auditor.
The City’s financial statements are subject to annual audit by the State Auditor. The last audit covered the
year ended December 31, 2005 and the report thereon contained an unqualified opinion regarding the City’s
2005 financial statements. Copies of the State Auditor’s Report maybe obtained by contacting the Office of
State Auditor in Olympia, Washington, the City or on-line at www.sao.wa.gov.
The Budgetary Process
The City budgets it funds in accordance with chapter 35A.33 RCW. Annual appropriated budgets are adopted
for the general, special revenue, debt service, and capital projects funds on the cash basis of accounting and
include fund balances. The City provides a reconciliation of the differences between the budgetary basis and
GAAP each year in its Comprehensive Annual Financial Report.
The City Council annually adopts a budget by ordinance establishing appropriations for City fimds, and during
the year may authorize supplemental appropriations. Administrative and legal budgetary control is established
at the fund level, i.e., expenditures for a fund may not exceed the total appropriation amount. The Mayor or
Chief Administrative Officer may authorize transfers of appropriations within a fund however interfund
transfers must be approved by ordinance of the Council.
[The remainder of this page intentionally left blank.]
19
Historical and Budgeted General Fund Operating Results
Historical GeneralFund Operating Results. The financial information that follows was extracted from the
City’s annual audited financial statements for the fiscal years ended December 31, 2001 through 2005.
Additional information which may interpret, clarify or modify the data presented below may be contained in
the complete financial audits, including the accompanying footnotes, which maybe obtained by contacting the
City Auditor upon payment of charges for copying, mailing and handling. See also "City Financial
Information - Auditing of City Finances" herein.
Beginning Fund Balance
Revenues:
Taxes
Licenses and Permits
Intergovemmental
Charges for Services
Fines and Forfeitures
Interfund Revenues
Contributions
Interest
Miscellaneous
Total Revenues
Total Sources
Expenditures:
General Government
Security of Persons/Propert3
Physical Environment
Economic Environment
Mental and Physical Health
Culture and Recreation
Capital Outlay
Total Expenditures
Sale of Assets
Net Transfers
Adjustments
Ending Fund Balance
Fiscal Year Ending December 31
Audited Audited Audited Audited Audited
2001 2002 2003 2004 2005
$8,337,005 $6,746,368 $4,003,136 $6,841,364 $8,754,507
$31,482,675 $32,014,248 $35,320,008 $35,452,979 $38,346,842
2,110,600 2,371,596 2,562,807 2,662,749 3,046,091
1,966,122 1,941,063 2,127,364 2,347,221 2,994,718
4,196,915 4,121,870 2,740,465 1,998,396 2,163,442
944,671 948,861 1,014,382 964,804 683,045
0 0 2,536,155 2,613,038 2,718,806
101,783 40,133 61,356 104,804 66,228
1,208,435 555,023 469,994 601,898 367,469
158,530 70,013 38,663 109,464 90,604
42,169,731 42,062,807 46,871,194 46,855,353 50,477,245
50,506,736 48,809,175 50,874,330 53,696,717 59,231,752
$8,977,920 $10,172,983 $10,791,833 $10,969,047 $11,541,778
23,596,319 24,926,075 26,029,354 27,462,613 29,031,626
1,878,916 1,897,165 2,015,562 2,201,777 2,190,228
3,487,376 3,605,013 3,600,630 3,951,377 4,266,112
6756 11,445 10,368 11,723 12,700
177,039 903 0 34,686 43,453
141,210 24,221 29,348 0 103,115
38,265,536 40,637,805 42,477,095 44,706,990 47,189,012
$55,168 $104,825 $19,129 $2,325 $37,047
(5,550,000)(4,273,059)(1,575,000)(3,266,800)(2,881,916)
0 0 0 2,986,493 0
$6,746,368 $4,003,136 $6,841,364 $8,711,745 $9,197,871
Source: City Audited Financial Statements
20
General Fund Budget The following comparative financial data is extracted from the City’s 2005 and
2006 General Fund Budgets.
Beginning Fund Balance
2005 2006
Budget Budget
$6,682,351 $6,922,731
Revenues:
Property Taxes
Sales Taxes
Utility Taxes
Gambling Excise Tax
Other Taxes
Licenses and Permits
Intergovernmental
Charges for Services
Fines and Forfeitures
Investment Income
Miscellaneous & Other
Interfund Revenues
Total Revenues
$9,869,700 $9,647,388
18,427,600 19,138,252
5,264,200 5,559,436
2,005,000 2,305,000
1,418,000 1,551,582
1,962,800 3,395,598
2,272,905 2,260,400
1,543,400 2,144,200
969,500 701,400
657,800 649,500
192,725 189,100
2,507,600 2,554,400
$47,091,230 $50,096,256
Total Sources $53,773,581 $57,018,987
Expenditures:
Regular Salaries
Part Time Salaries
Overtime
Personnel Benefits
Supplies
Professional Services
Postage/Telephone
Travel/Training
Equipment and Other Rentals
Insurance
Public Utility Services
Repairs and Maintenance
Other Services & Charges
Intergovemmental Services/Payments
Capital Outlay
Interfund Payment
Transfer Out
Total Expenditures
Increase to Reserves
Ending Fund Balance
$25,530,600 $26,474,500
188,200 131,020
1,819,935 1,790,700
7,983,700 9,183,650
991,395 856,325
3,149,900 3,041,912
406,100 74,400
212,400 222,875
1,497,200 1,497,200
1,564,200 1,564,200
14,000 14,000
368,500 230,250
734,900 781,657
1,714,900 1,897,360
49,200 54,900
0 1,974,307
2,881,916 272,000
$50,107,046 $50,061,256
0 35,000
$3,666,535 $6,957,731
Source:City’s Budget Report
21
General Information
THE CITY
The City surrounds the southern end of Lake Washington, southeast of Seattle on Interstate 405. The City is
located approximately 20 miles southeast of the City of Seattle and approximately 60 miles northeast of the
City of Olympia, the State’s capital. As of the 2005 population estimates, the City ranked fifth in size among
cities in the County. The City had a population of 58,360 as estimated in 2006 by the State Office of
Financial Management. The County had an estimated population of 1,808,300 as reported in 2005 by the
State Office of Financial Management, an increase of approximately 4.1% since the 2000 Census.
Major contributors to the area’s economy are manufacturing, technology-based business, the Port of Seattle,
services industry, tourism, fishing and agriculture. (See "Appendix A - Economic and Demographic
Information" herein for a description of the area’s economy.)
Form of Local Government
The City, which was incorporated in 1901, has a strong Mayor form of government. The Mayor is
independently elected to a four-year term. The Mayor’s job is to manage and implement the policies
established by the seven-member Council. Each Council member serves a four-year term and is elected on a
staggered two-year cycle.
The names of the current members of the City Council as well as the dates on which of their respective terms
of office expire are as listed below.
Expiration of
Name Title Term
Kathy Keolker Mayor 12/31/07
Randall Corman President 12/31/09
Terri Briere Council Member 12/31/09
Dan Clawson Council Member 12/31/09
Denis Law Council Member 12/31/07
Toni Nelson Council Member 12/31/07
Marcie Palmer Council Member 12/31/07
Don Persson Council Member 12/31/07
Principal City Officials
Kathy Keolker, Mayor. Ms. Keolker was appointed to the Renton City Council in 1984 by her fellow City
Council members and served five terms as a Councilmember. On January 1, 2004, she began her first term
serving as Mayor. Ms. Keolker has been an active member of the Renton community since 1976, which
includes serving as a past Chair of the United Way South Community Council, serving as a currently member
of the United Way of King County Board and being a active member in petition processes. In addition to her
duties as Mayor, Ms. Keolker works with the Center of Women and Democracy at the University of
Washington as a trainer and "leader in residence" for NEW Leadership Puget Sound.
22
Jay Covington, Chief Administrative Officer. Mr. Covington joined City staffin 1990. Prior to joining the
City, Mr. Covington served eight years at the City of Vancouver, Washington, in the roles of budget analyst,
management analyst and Assistant to the City Manager. During his tenure with the City of Vancouver, Mr.
Covington developed a municipal biennial budget as well as improved financial forecasting techniques.
Michael E. Bailey, Finance & Information Services Administrator. Mr. Bailey joined City staffas Finance &
Information Services Administrator on September 1, 2005. Mr. Bailey is a certified public accountant and
prior to being appointed to his current position with the City, Mr. Bailey was employed as the Finance
Director for the City of Lynwbod since 1999, and previously served as the Finance Director for the cities of
Everett and Wenatchee and the Metropolitan Park District of Tacoma. Mr. Bailey earned a Bachelor’s degree
in Business Administration and Accounting and a Master’s degree in Public Administration, both from the
University of Puget Sound. Mr. Bailey is a past President of the Washington Finance Officers Association, a
past representative for the State of Washington to the National Finance Officers Association and was named
"Business Person of the Year" by the National Future Business Leaders of America in 1998.
City Employment and Primary Services
The City had approximately 616 full-time employees as of January 1, 2006 and 709 full-time equivalent
employees when including seasonal and part-time employees. The City provides services in accordance with
its charter, and operates its own police, fire, park and recreation, utility system, municipal airport and library
system.
Employee Relations
The City has five bargaining units. The commissioned police officers have a guild. The guild also represents,
in a separate bargaining unit, the non-commissioned support staff of the Police Department. There are two
bargaining units in the Fire Department. The firefighters through the rank of captain are represented as a
group. There are six battalion chiefs who are represented by a separate bargaining unit. The greatest number
of employees is represented by AFSCME (American Federation of State and City Municipal Employees).
State law requires municipalities to bargain collectively with formally recognized collective bargaining units.
The management group tends to receive benefits very similar to the AFSCME contract. There are no
sigrfificant outstanding personnel issues at this time. The City bargains with each of the units every three
years. The City has contracts with all the bargaining units through 2008.
Pension Plans
Public Employees ’Retirement System ("PERS"). Substantially all of the City’s full-time and qualifying part-
time employees, other than those covered under union plans, participate in PERS. This is a statewide local
government retirement system administered by the Washington State Department of Retirement Systems,
under cost-sharing, multiple-employer defined benefit public employee retirement plans. The PERS system
includes three plans.
23
Participants who joined the system by September 30, 1977, are PERS Plan I members. Those joining
thereafter are enrolled in PERS Plan II. In March 2000, Govemor Gary Locke signed into law a new
retirement plan for members of the PERS Plan II. The new plan, entitled PERS Plan III, provides members
with a defined benefit plan similar to PERS Plan I! and the opportunity to invest their retirement contributions
in a defined contribution plan. PERS Plan II members that joined on or after October 1, 1977 ; and either by
February 28, 2002 for state and higher education employee or August 31, 2002 for local government
employees; are PERS Plan II members unless they exercise an option to transfer their membership to PERS
Plan III. PERS Plan II participants joining the system on or after
March 1, 2002, for state and higher education employees, or September 1, 2002 for local government
employees have the irrevocable option of choosing membership in either PERS Plan II or PERS Plan 1II. The
option must be exercised within 90 days of employment and an employee is reported to PERS Plan II until a
choice is made and if a choice is not made within 90 days the employee defaults to PERS Plan III. PERS
defined benefit retirement benefits are financed from a combination of investment earnings and employer and
employee contributions. PERS retirement benefit provisions are established in state statute and may be
amended only by the State Legislature.
PER Plan I benefits are vested after an employee completes five years of eligible service. PERS Plan I
members are eligible for retirement at any age after 30 years of service, at age 60 with five years of service, or
at age 55 with 25 years of service. The annual pension is two percent of the average final compensation per
year of service, capped at 60 percent. The average final compensation is based on the greatest compensation
earned during any 24 eligible consecutive compensation months. If qualified, after reaching age 66, a cost of
living allowance is granted based on years of service credit and is capped at 3% annually.
PER Plan II benefits are vested after an employee completes five years of eligible service. PERS Plan II
members may retire at age 65 with five years of service or at 55 with 20 years of service. The annual pension
is two percent of the average final compensation per year of service. The average final compensation is based
on the greatest compensation during any eligible consecutive 60-month period. PERS Plan II retirements prior
to 65 receive reduced benefits. If retirement is at age 55 or older wit 30 years of service, a 3% per year
reduction applies; otherwise an actuarial reduction will apply. There is not cap on years of service credit and a
cost-of living allowance is granted (indexed to the Seattle Consumer Price Index), capped at 3% annually.
PERS Plan III has a dual benefit structure. Employer contributions finance a defined benefit component, and
member contribution finance a defined contribution component. The defined benefit portion provides a
benefit calculation at 1% of the average final compensation per year of service. The average final
compensation is based on the greatest compensation during any eligible consecutive 60-month period. PERS
Plan III members become eligible for retirement if they have at least ten years of service; or five years
including twelve months that were earned after age 54; or five service credit years earned in PERS Plan II
prior to June 1, 2003. PERS Plan III retirements prior to age 65 receive reduced benefits. If retirement is at
age 55 or older with at least 30 years of service; a 3% per year reduction applies; otherwise an actuarial
reduction will apply. There is no cap on year of service credit and a cost-of living allowance is granted
(indexed to the Seattle Consumer Price Index), capped at 3% annually. The defined contribution portion can
be distributed in accordance with an option selected by the member, either as a lump sum or pursuant to other
options authorized by the Employee Retirement Benefits Board.
Each biennium, the State Pension Funding Council adopts PERS Plan I employer contribution rates, PERS
Plan II employer and employee contribution rates and PERS Plan III employer contribution rates. Employee
contribution rates for PERS Plan I are established by statute at six percent and do not vary from year to year.
24
The employer and employee contribution rates for PERS Plan II and the employer contribution rates for PERS
Plan III are developed by the Office of the State Actuary, to continue to fully fund PERS Plan II and the
defined benefit portion of PERS Plan III. All employers are required to contribute at the level established by
the Legislature. PERS Plan II defined contribution is a non-contribution plan for employers. Employees who
participate in the defined contribution portion of the PERS Plan III do not contribute to the benefit portion of
PERS Plan III. The Employee Retirement Benefits Board sets PERS Plan II employee contribution rates. Six
rate options are available ranging from 5-15%; two of the options are graduated rates dependent upon the
employee’s age. The methods used to determine the contribution requirements are established under state
statute in accordance with 41.40 and 41.46 RCW.
All employers are required to contribute at the level established by State law. The methods used to determine
the contribution requirements are established under State statute in accordance with Chapters 41.40 and 41.26
RCW.
The City’s required contribution for PERS Plan I, II and III for the year ended December 31, 2005, was
$33,340, $367,240 and $51,521, respectively..
Law Enforcement Officers’ and Fire Fighters’ Retirement System ("LEOFF"). LEOFF is a cost-sharing
multiple-employer defined benefit pension plan. Membership in the plan includes all full-time, fully
compensated local law enforcement officers, and fire fighters. The LEOFF system includes two plans.
Participants who joined the system by September 30, 1977, are LEOFF Plan I members. Those joining
thereafter are enrolled in LEOFF Plan II. Effective July 1, 2003, the LEOFF Plan II Retirement Board was
established to provide governance of LEOFF Plan II. The Board’s duties include adopting contribution rates
and recommending policy changes to the Legislature for the LEOFF Plan II. Effective January 1, 2003,
firefighter emergency medical technicians (EMT’s) may transfer PERS Plan I or II service credit to LEOFF
Plan II if(while employed for the City), the EMT’s job was relocated to a fire department from another city.
Retirement benefits are financed from employee and employer contributions, investment earnings, and State
contributions. LEOFF retirement benefit provisions are established in state statute and may be amended only
by the State Legislature. Retirement benefits in both LEOFF Plan I and LEOFF Plan II are vested after
completion of five years of eligible service.
LEOFF Plan I retirement benefits are vested after an employee competes five years of eligible service.
LEOFF Plan I members are eligible for retirement with five years of service at age 50. The service retirement
benefit is dependent upon the final average salary and service credit years at retirement.
Term of Percent of Final
Service Average
5-9 years 1.0%
10-19 years 1.5
20 or more years 2.0
The final average salary is the basic monthly salary received at the time of retirement, provided a member has
held the same position or rank for 12 months preceding the date of retirement. Otherwise, it is the average of
the highest consecutive 24 months’ salary within the last 10 years of service. If membership was established
in LEOFF after February 18, 1974, the service retirement benefit is capped at 60% of final average salary. A
cost-of-living allowance is granted (indexed to the Seattle Consumer Price Index).
25
LEOFF Plan II retirement benefits are vested after an employee competes five years of eligible service.
LEOFF Plan II members are eligible to retire at the age of 50 with 20 years of service or at 53 with five years
of service, with an allowance of 2% of the final average salary per year of service. The final average salary is
determined as the 60 highest paid consecutive service months. LEOFF Plan II retirements prior to age 53 are
reduced 3% for each year the benefit commences prior to age 53. There is no cap on years of service credit
and a cost-of-living allowance is granted (indexed onto the Seattle Consumer Price Index), capped at 3%
annually.
Commencing July 1, 2000, LEOFF Plan I employers and employees will contribute 0% as long as the plan
remains fully funded. Employer and employee rates for LEOFF Plan II are set by the director of the
Departanent of Retirement Systems, based on recommendations by the Office of the State Actuary, to continue
to fully fund the plan. LEOFF Plan I employer and employee contribution rates are established by statute, and
the State is responsible for the balance of the funding at rates set by the Pension Funding Council to fully
amortize the total costs of the plan. LEOFF Plan II employers and employees are required to contribute at the
level required by State law. The methods used to determine the contribution rates are established under State
statute in accordance with Chapters 41.26 and 41.45 RCW.
The City’s required contribution for LEOFF Plan I and II for the year ended December 31,2005, was $2,554
and $549,001, respectively..
Historical trend information regarding all of these plans is presented in Washington State’s Department of
Retirement Systems’ annual financial report. A copy of this report may be obtained at:
Department of Retirement Systems
Point Plaza West
1025 East Union Street
P.O. Box 48380
Olympia, WA 98504-8380
Internet Address: www.drs.wa.gov
GASB 45. The Governmental Accounting Standards Board ("GASB") has issued a new standard concerning
Accounting and Financial Reporting by Employers for Post Employment Benefits Other than Pensions
("GASB 45"). In addition to pensions, many state and local governmental employers provide other post
employment benefits ("OPEB") as a part of total compensation to attract and retain the services of qualified
employees. OPEB includes post employment healthcare, as well as other forms of post employment benefits
when provided separately fxom a pension plan. The new standard provides for the measurement, recognition
and display of OPEB expenses/expenditures, related liabilities (assets), note disclosures, and if applicable,
required supplementary information in the financial reports. This pronouncement is effective for the City for
the fiscal year ending on December 31, 2007.
The City provides medical benefits to retired firefighters and police officers who were hired prior to 1978 as
required by 41.26.15 RCW. Entry into this benefit system is closed.
An actuarial study was completed by Nicolay Consulting on January 4, 2005. At that time there were 106
participants in the system. As of June 30, 2006, there are 107 participants. The study found that the City’s
Annual Required Contribution to fully fund the anticipated costs of $25,864,528 would be $1,495,748
annually until 2035 (30 years). In the 2006 budget, the City allocated $1,700,000 to this obligation. The City
anticipates commissioning another actuarial study by year-end. The City intends to comply with GASB 45
reporting requirement in its 2006 financial report.
26
Risk Management
The City insures its risk exposure up to specified levels of risk as determined by the City, and purchases
excess insurance commercially to cover medium to large losses. The City’s risk management program is
administered by the Human Resources/Risk Management Administrator, with claims processed by
independent claims administrators. The City is a member of the Washington Cities Insurance Authority
comprised of approximately 108 public agencies located in the State of Washington. Shown below are the
City’s insurance limits through the Washington Cities Insurance Authority.
Risk Retention Stop Gap
Coverage Type Per Occurrence Loss Limit
Property $25,000 $500,000,000~
Liability 250,000 14,000,000~
Auto Liability 250,000 14,000,0001
Boiler & Machinery 5,000 50,000,000
Public Officials 250,000 10,000,000
Crime 10,000 1,000,000
Airport Liability 0 50,000,000
Underground Storage Tank 10,000 1,000,000
Worker’s Compensation 350,000 1,000,000
Employee Health 210,000 N/A
Stop Gap Loss Limit is per occurrence with the property coverage subject to limits.
APPROVAL OF BOND COUNSEL
Legal matters incident to the authorization, issuance and sale of the Bonds by the City are subject to the
unqualified approving legal opinion of Gottlieb, Fisher & Andrews, PLLC, Seattle, Washington, Bond
Counsel. Fees payable to Gottlieb, Fisher & Andrews, Seattle, PLLC, as Bond Counsel, are contingent upon
the issuance of Bonds. Bond Counsel has reviewed this document only to confirm that the portions of it
describing the Bonds and the authority of the City to issue them conform to the Bonds, the applicable laws
under which they were issued and the language regarding federal income tax exemption. A form of the legal
opinion is included herein in Appendix C.
TAX EXEMPTION
General
In the opinion of Gottlieb, Fisher & Andrews, PLLC, Bond Counsel, as of the date of issue of the Bonds (the
"Date of Issue"), and assuming the City complies with applicable requirements of the Code which must be
satisfied subsequent to the issuance thereof, interest on the Bonds (including any original issue discount
properly allocable to the owner thereof) is excludable from gross income for purposes of federal income
taxation under existing federal law, and is not an item of tax preference for purposes of determining the
alternative minimum tax on individuals and corporations under existing federal law. However, under existing
federal law, interest on the Bonds (including any original issue discount properly allocable to the owner
thereof) is taken into account in determining adjusted current earnings for the purpose of computing the
alternative minimum tax imposed on certain corporations.
27
Continuing Requirements
The Code contains certain requirements which must be satisfied subsequent to the issuance of the Bonds in
order to maintain the tax treatment described above, including requirements relating to the application of the
proceeds of the Bonds, use of facilities which are financed with such proceeds, limitations on income derived
from the investment of gross proceeds of the Bonds (as defined in Section 148 of the Code), and rebate to the
United States Treasury of certain of such investment income. The City has covenanted to comply with these
requirements to the extent applicable; and the opinions of Bond Counsel described in the preceding paragraph
assume such compliance. However, Bond Counsel has not undertaken and shall not undertake to monitor
compliance by the City with such requirements; and if the City should fail to comply with such requirements,
interest on the Bonds could become includable in gross income for federal income tax purposes, and could be
treated as an item of tax preference for purposes of the alternative minimum tax on individuals and
corporations, in each case, retroactive to the Date of Issue.
OTHER FEDERAL TAX MATTERS
Ownership of the Bonds may result in other federal tax consequences to certain taxpayers, including, without
limitation, certain S corporations, foreign corporations with branches in the United States, property and
casualty insurance companies, individual recipients of Social Security or Railroad Retirement benefits, and
taxpayers, including banks, thrift institutions and other financial institutions subject to Section 265 of the
Code, who may be deemed to have incurred or continued indebtedness to purchase or to carry the Bonds, and
taxpayers who have an initial basis in the Bonds greater or less than the principal amount thereof. Bond
Counsel is not rendering any opinion as to any federal tax matters other than as described under the caption
"Tax Exemption--General." Prospective purchasers of the Bonds should consult their independent tax
advisors.
Tax Covenants
The City has covenanted in the Bond Ordinance that: (1) it will not take or permit to be taken on its behalf any
action that would adversely affect the exclusion of the interest on the Bonds from the gross income for
purposes of federal income taxation, and will take or require to be taken such acts as may be permitted by
Washington law and as may from time to time be required under applicable law to continue the exclusion of
the interest on the Bonds from the gross income for purposes of federal income taxation.; and (2) it will
calculate or cause to be calculated, and rebate to the United States, all earnings from the investment of Bond
proceeds that are in excess of the amount that would have been earned had the yield on such investments been
equal to the yield on the Bonds, plus income derived from such excess earnings, to the extent and in the
manner required by Section 148 of the Code.
NO LITIGATION CONCERNING THE BONDS
There is no controversy or litigation of any nature now pending or, to the knowledge of the City, threatened,
restraining or enjoining the issuance, sale, execution or delivery of the Bonds, or in any way contesting or
affecting the validity of the Bonds, any proceedings of the City taken with respect to the issuance or sale
thereof, or affecting the ability of the City to pay the principal of and interest on the Bonds.
28
UNDERWRITING
D. A. Davidson & Co. (the "Underwriter") has agreed, subject to the terms of a Bond Purchase Agreement, to
purchase the Bonds from the City at a price of % of the par value of the Bonds, plus accrued
interest from August 1, 2006. The Bonds are being offered for sale to the public at the prices shown on the
inside cover of this Official Statement. Concessions from the initial offering price maybe allowed to selected
dealers and special purchasers. The initial offering prices are subject to change after the date hereof.
RATINGS
As noted on the cover page of this Official Statement, Standard & Poor’ s Rating Group, New York, New York
and Fitch Ratings, New York, New York have given the Bonds the ratings of""and" ", respectively,
on the understanding that the Bonds will be insured by the . Each rating reflects onlythe
view of the applicable rating organization and the current assessment of the creditworthiness of the Insurer and
its ability to pay claims on its policies of insurance.
Standard & Poor’s Rating Group and Fitch Ratings have assigned their municipal ratings of"___" and"
respectively, (the "underlying ratings") to the Bonds.
An interpretation of such rating maybe obtained only from the rating agency furnishing the same. Any further
explanation of the significance of the ratings may be obtained from Standard & Poor’s Ratings Group, at 55
Water Street, New York, New York 10041 (telephone 212-438-2000) and Fitch Ratings, One State Street
Plaza, New York, New York 10004 (telephone 212-908-0800).
The above ratings are not a recommendation to buy, sell or hold the Bonds. There is no assurance that such
ratings will continue for any given period of time or that it will not be revised downward or withdrawn
entirely by such rating agencies, if in judgment of such rating agency circumstances so warrant. Any such
downward revision or withdrawal of such rating may have an adverse effect on the market price of the Bonds.
NO CONFLICTS OF INTEREST
The City is not aware of the existence of any actual or potential conflict of interests, breach of duty or less
than arm’s-length transaction regarding the selection of the Underwriter, Bond Counsel, Financial Advisor and
other participants in the offering of the Bonds. Further, the City is not aware of any undisclosed payments to
obtain underwriting assignments and undisclosed agreements or arrangements, including fee splitting, between
the Underwriter and other participants in the offering of the Bonds. The payment of Bond Counsel’s fee and
the underwriting fees are contingent upon the issuance and delivery of the Bonds.
29
COMMITMENT TO PROVIDE CONTINUING DISCLOSURE
The Securities and Exchange Commission (the "SEC") has promulgated certain amendments to Rule 15c2-12
under the Securities Exchange Act of 1934 (the "Rule") that make it unlawful for an underwriter to participate
in the primary offering of municipal securities in a principal amount of $1,000,000 or more unless, before
submitting a bid or entering into a purchase contract for the bonds, it has reasonably determined that the issuer
or an obligated person has undertaken in writing for the benefit of the bondholders to provide certain
disclosure information to prescribed information repositories on a continuing basis. A complete description of
the information to be disclosed by the City, the manner of disclosure and remedies in the case of default is
found in Appendix B herein.
ADDITIONAL INFORMATION AND MISCELLANEOUS
The descriptions herein of the Bond Ordinance and other documents are brief summaries of certain provisions
thereof. Such summaries do not purport to be complete, and reference is made to such documents and
contracts, copies of which are available, upon request and upon payment to the City of a charge for copying,
mailing and handling, from the City, 1055 South Grady Way, Renton, Washington 98055, telephone (425)
430-6858, attention Finance and Information Services Administrator.
The summaries and descriptions contained in this Official Statement and the Appendices hereto of the
provisions of the Bonds, the Bond Ordinance and all reference to other materials not purporting to be quoted
in full are only brief outlines of some of the provisions thereof and do not purport to summarize or describe all
of the provisions thereof. This Official Statement is not to be construed as a contract or agreement between
the City and the Underwriter or holders of any of the Bonds.
Any statements made in this Official Statement involving matters of opinion or estimates, whether or not so
expressly stated, are set forth as such and not as representations of fact. No representation is made that any of
such statements will be realized.
APPROVAL OF OFFICIAL STATEMENT
The City, in the Bond Ordinance, will deem this Preliminary Official Statement "final" as of its date, except
for the omission of information dependent on the pricing of this issue and completion of the underwriting
agreement, for purposes of compliance with Rule 15c2-12.
The execution and delivery of this Official Statement have been duly authorized by the City.
CITY OF RENTON, WASHINGTON
By:
Michael E. Bailey
Finance and Information Services Administrator
3O
APPENDIX A
Economic and Demographic Information
A-1
ECONOMIC AND DEMOGRAPHIC INFORMATION
Local Economic Overview
The City of Renton, Washington (the "City") is located in northwestern Washington in King County (the
"County"). The City is located approximately 20 miles southeast of the City of Seattle and approximately 60
miles northeast of the City of Olympia, the State’s Capital. As of the 2005 population estimates, the City
ranked fifth in size among cities in the County. The City had a population of 58,360 as estimated in 2006 by
the State Office of FinanciaFManagement. The County had an estimated population of 1,808,300 as
reported in 2005 by the State Office of Financial Management, an increase of approximately 4.1% since the
2000 Census.
The County encompasses 2,128 square miles, ranking 1 ltU in geographical size ofWashington’s 39 counties,
but first in population. Seattle is the largest city in the Pacific Northwest and serves as the County seat. The
County and Snohomish and Island Counties to the north together comprise the Seattle Primary Metropolitan
Statistical Area (the "Seattle PMSA"), which is the fourth-largest metropolitan center on the Pacific Coast.
In addition to the City and the City of Seattle, principal cities of the Seattle PMSA include Auburn, Bellevue,
Bothell, Burien, Federal Way, Issaquah, Kent, Mercer Island, Redmond, Renton, Shoreline, and
Woodinville, all of which are in the County, and Everett, Edmonds, Mountlake Terrace and Lynnwood in
Snohomish County. These communities serve as residential, commercial, and industrial satellites of Seattle.
Seattle PMSA’s employment base is well diversified, with strengths in manufacturing, trade services and
government sectors. In 2004, manufacturing comprised about 7.9% of the area’s employment, with aircrai~
production representing the largest component. In the non-manufacturing sectors, services was the largest
sector with over 41.0% of the total employment, wholesale and retail trade comprised almost 14.8% and
government and government enterprises 12.0%. The information industry contributed approximately 12.5%
of the total income by industry in the County, the most of all industries, followed by wholesale and retail
trade with 12.4%, manufacturing with 11.7% and government and government enterprises with 11.6%. The
U.S. Defense Department is one of the largest employers in the Puget Sound region. Major facilities include
Fort Lewis Army Base in Pierce County, the Puget Sound Naval Shipyard in Bremerton (Kitsap County),
Bangor Naval Submarine Base in Kitsap County, McChord Air Force Base in Pierce County and Naval
Station Everett.
The area’s universities and research institutions serve as catalysts in the expansion of high tech industries.
Other key factors that support continued growth include the existing industry base; a well-trained labor
force; relatively low cost power; and a progressive business climate with excellent transportation access to
worldwide markets.
Aircraft Manufacturing - The Boeing Company
Manufacturing in the area consists primarily of aircraft manufacturing by the Boeing Company ("Boeing").
Boeing is the second largest manufacturer in the world of commercial jets, behind Airbus, and the second
largest defense contractor, behind Lockheed Martin and is consistently one of the nation’s top three
exporters. In May 2001, Boeing moved its world headquarters and approximately 1,200 employees from
Seattle to Chicago to allow the corporate staff to focus on the direction of the company rather than day-to-
day operations. Boeing remains the area’s largest employer with several locations in the Puget Sound
region.
A-2
In 2005, Boeing reported total revenues of $54.8 billion. While the primary activity of Boeing is the
manufacture of commercial aircraft, Boeing has played leading roles in the aerospace and military missile
programs of the United States human space flight, launch services and has undertaken a broad program of
diversification activities including Boeing Computer Services. Boeing has six major divisions to carry out
business activities, which include Air Traffic Management, Boeing Capital Corporation, Commercial
Airplanes, Connexion by Boeing, Military Aircraft and Missile Systems, and Space and Communications.
In recent years, Boeing has strived to streamline workforce operations and facilities. Since 1998, Boeing has
reduced its total workforce from 231,260 to 159,000 (as of January 2005), a decrease of approximately
72,260 (31.2%) employees. Since 1998, Boeing has reduced the total work force in the Central Puget Sound
Region from 98,440 to 55,400 (January 2005) a decrease of approximately 43,040 (43.7%) employees.
Boeing’s Washington employees are located largely in the Puget Sound Region, which currently has 15
Boeing sites/locations. As of the date of this Official Statement, it cannot be predicted if there will be further
Boeing layoffs that will impact Puget Sound Region operations.
Technology
The Seattle PMSA has experienced a substantial development of high technology, electronics and computer-
related enterprises particularly over the last decade. More than 1,500 computer development firms are
located in the Seattle PMSA. Microsoft, which is headquartered in Redmond, Washington, is the largest
computer software company in the world, with 2005 gross revenues worldwide of $39.8 billion, increasing
$3 billion or 8% since 2004. Other leading employers include Sundstrand Data Control, Inc. (electronics and
aerospace systems), ELDEC Corporation (electronic equipment), John Fluke Manufacturing Company
(electronic testing and calibrating instruments), Nintendo of North America (electronic games), Advanced
Technology Laboratories (medical ultra-sound equipment), Heath Techna Aerospace Co. (aerospace and
defense specialties and architectural equipment), Alliant Techsystems Inc. (sonar systems and signal
processing equipment), and Intermec Corporation (bar coding equipment).
Transportation
Seattle is bordered on the west by Elliott Bay, a natural harbor on Puget Sound, which is one of the nation’s
leading seaports. The Port of Seattle (the "Port"), a County-wide port district, promotes maritime trade,
particularly foreign trade and the employment of containerized cargo facilities, and has developed and is
continually improving a system of marine terminals, piers and associated facilities on Seattle’s waterfront.
The Port is one of the largest container ports in North America, ranking fifth in 2005 (behind Los Angeles,
Long Beach, New York/New Jersey, Oakland,) when measured by twenty-foot equivalent units ("TEU’s")
The Port of Seattle handled 2.08 million TEU’s, and the Port of Los Angeles handled 7.5 TEU’s.
Sea-Tac Airport ("Sea-Tac") is a major airport serving the State and is an aviation division of the Port.
According to the Airports Council International, Sea-Tac is the 17tu business commercial airport based upon
total passengers in 2005. In 2005, Sea-Tac had a total of 29,289,026 air passengers, 91.5% of which were
domestic travel. As of December 2005, Sea-Tac had 22,000 airport employees and 14,000 off-site airport
related jobs. Sea-Tac is served by at least 24 airlines. In 2005, Sea-Tac generated $4.3 billion in business
revenue. For 2005, as reported by Sea-Tac, daily-non-stop service was available to 71 domestic cities and 16
international cities.
A-3
King County International Airport ("Boeing Field"), a general aviation facility operated by the County, is
located in Seattle. With about 300,000 annual operations (takeoffs and landings), Boeing Field is the busiest
such facility in the region and ranks among the top 15 busiest in the nation. It serves as the primary
inclement weather alternate for SeaTac.
Seattle is the western terminus of two primary east-west freeway systems: Interstate Route 90 and State
Route 520, and is traversed by north-south Interstate Route 5 and State Route 99. The portion of 1-90 that
connects Seattle with eastside communities across Lake Washington was expanded to eight lanes at a cost of
$1.2 billion in the early 1990’s. In addition to the highway system, the Washington State Ferry System
provides convenient transportation between Seattle and points across Puget Sound to the west.
Sound Transit In 1996, voters in King, Pierce and Snohomish counties approved a $3.9 billion regional
transit measure. The transit system will be funded in large part with increases in local sales taxes and
vehicle license fees. Some federal funds will be contributed. The transit system is currently under
construction, expected to take ten years to build and will consist of electric light rail, commuter rail and
express buses.
In 2003, Sound Transit began construction on the initial 14-mile that stretched from Westlake Station to
Tukwila!International Boulevard. In late 2005, the Downtown Seattle Transit Tunnel was closed to allow for
modification so that it can be used by buses the Link light rail ("Link"). The runnel may be closed for up to
two years. The Link trains are to begin testing in the fall of 2006 and will consist of 95-foot long cars that
can seat 74 passengers and up tot 200 passengers with standees. It is anticipated that Link service will begin
with 2-car trains and with the size of each platform, could be increased to 4-car trains, if necessary. It is
anticipated that Link will be ready for passengers in 2009.
In December of 2004, Sound Transit and the Port agreed to extend Link 1.7 miles to Sea-Tac Airport.
Construction has begun and is expected to be completed by December of 2009. Until this section is
completed, a shuttle bus will be available at Tukwila/International Boulevard for passengers going to Sea-
Tac. In addition, other extensions are also underway including: a North Link which would extend Link as
far north as Northgate and is currently in the planning and design phase, and a 3.15 mile University Link
connecting downtown Seattle to the University of Washington that may have construction started as soon as
2008. In 2003, a 1.6 mile Tacoma Link opened that would serves Tacoma Dome Station, downtown
Tacoma and University of Washington’s Tacoma campus.
The Sound Transit System also operates the Sounder Commuter Rail ("Sounder"), which is an 82-mile
system through three counties and contains 12 stations that utilize existing tracks between Everett, Seattle,
Tacoma and Lockwood. Sounder currently runs two transfer every weekday in the North Corridor and runs
four trains every weekday in the South Corridor. Sounder serves approximately 1 million passengers
annually. Sounder is anticipated to begin service from Tacoma to Lakewood in early 2008.
In addition, Sound Transit System operations ST Express Regional Bus. ST Express is spending in excess of
$800 million on at least 36 transportation improvement projects to enhance speed and reliability. The bus
routes are designed to provide a seamless network of transportation to include the Link, Sounder and buses.
A-4
Fishing, Agriculture and Forest Products
Seattle is the homeport for a major salmon and halibut fishing fleet. Approximately 700 fishing boats are
based at the Port’s Fishermen’s Terminal on Salmon Bay, part of the fresh-water system of lakes and canals
connected to Puget Sound by the Hiram M. Chittenden Locks, which are operated by the US Army Corps of
Engineers. Fish received in Seattle are largely for fresh market distribution and for freeze processing.
Seattle is also a warehousing and distribution center for fish processed elsewhere in the Northwest,
principally in Alaska.
Agriculture in the County consists primarily of dairy farming, truck gardening, horticulture and the raising of
livestock and poultry. The Seattle area is a major center in the Northwest for agricultural supply, distribution
and marketing as well as for food handling and processing and the manufacture of food packaging and
containers.
The local forest products industry includes the manufacture of lumber, plywood, paper products, furniture,
acoustical materials and specialty wood products. Timber in the region is harvested under sustained-yield
programs on federal, state and private timberlands. The leading forest products employer is the
Weyerhaeuser Company, which operates lumber mills locally and has its corporate headquarters and a major
research and development center in southwestern portion of the County. Employment and production levels
within this industry locally have been and are expected to be further impacted by recent decisions by the
federal government and the courts concerning the exporting of raw logs and restrictions on the harvesting of
trees on federal lands in "old growth" forests. The extent of such impact is unknown at this time. The wood
and paper products industry accounts for approximately one percent of the total Seattle PMSA employment.
Higher Education
The University of Washington (the "University") is one of the oldest and largest state assisted universities on
the West Coast. Its primary campus is located in Seattle with satellite campuses located in Bothel! and
Tacoma. Established in 1861, the University has 16 schools and colleges offering instruction in more than
200 academic disciplines. Undergraduate and graduate student enrollment for fall semester 2005 was
42,974. The University has a biennial operating budget of approximately $2.5 billion and consistently ranks
among the top five institutions of higher learning in the United States when measured by the receipt of
federal grants. The largest share of this funding goes to the University of Washington School of Medicine.
Harborview Medical Center is the University’s teaching hospital. Every physician practicing at Harborview
is a member of the University’s School of Medicine faculty. This relationship has been essential to
Harborview’s development of outstanding patient care services including the region’s bum, trauma, epilepsy,
and spinal cord rehabilitation centers. Other higher education facilities in the Seattle area include two
private four-year universities, Seattle Pacific University (3,779 enrollment) and Seattle University (6,810
enrollment), and seven community colleges.
Services, Tourism, Recreation and Conventions
The Seattle area is the health care center of the Pacific Northwest. There are 26 general-acute and four
special purpose hospitals, more than 4,500 beds, and approximately 3,000 physicians.
A-5
The State’s fourth largest industry is tourism. There are over 8,000 hotel rooms in over 50 hotels and motels
in downtown Seattle. Seattle ranks in the top five cities in the nation in terms of hotel occupancy with 2004
occupancy rates of 64.2% with room rates averaging $95.48 per night. According to the Seattle-King County
Convention and Visitors Bureau, convention goers added approximately $432 million to the economy in
2004. The Washington State Convention and Trade Center currently occupies 102,000 square feet of heavy
load exhibition space and an expansion of approximately 105,000 square feet of which 70,000 square feet is
designed as clear span, column-free space. The Convention Center has the capacity to hold events involving
as many as 11,000 people. It is estimated that the Convention Center generates direct spending by visitors of
over $200 million annualls~ on hotels, restaurants, entertaining, transportation and retail shopping.
Bordered on the west by Puget Sound and the Olympic Mountains and on the east by the Cascade Mountain
range, the 2,128 square miles in the County offer many types of outdoor recreation. The County and the City
of Seattle maintain over 9,000 acres of parkland. The Seattle area has several symphony orchestras, five
theaters, an opera company, and four resident dance groups. The area is also the home to more than 3,000
artists and 1,300 arts organizations.
The Seattle Center, located one mile north of the central business district of Seattle, was the site for the 1962
World’s Fair and it continues to be a popular attraction for residents and tourists alike. The 74-acre, year-
round convention and family entertainment center includes the Pacific Science Center, Coliseum, Seattle
Opera House, Key Arena, Memoria! Stadium, Space Needle, the Experience Music Proj ect and a number of
meeting and display rooms. Key Arena serves as the home of Seattle’s third major league sports team, the
National Basketball Association’s Seattle Supersonics. A major renovation project was recently completed
at the Coliseum.
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A-6
Population Trends
The area’s population has grown significantly in recent years and based on recent population trends is
expected to continue to grow. The County is the most populated county in the State. Historical population
trends are presented below for the City, the County and the State to represent population trends in the area.
City of Percent of King Percent of State of Percent of
Year Remon Change County Change Washington Change
20051 58,360 16.6%1,808,300 4.1%6,256,400 6.1%
2000 50,052 20.1 1,737,046 15.2 5,894,143 21.1
1990 41,688 36.2 1,507,305 18.7 4,866,663 17.8
1980 30,612 --1,269,898 --4,132,353 --
~ Intercensus estimate as of April 2005 reported by the State Office of Financial Management and City estimate is as of 2006.
Source: U,S. Bureau of the Census and Washington State Office of Financial Management.
Trends in Building Permits
The following table reveals the trends in the valuation of new construction on building permits issued by the
City for the years shown. Numbers shown are in thousands.
Year
2005
2004
2003
2002
2001
Single Family Multi Family Commercial Other Total
Permits Permits Permits Permits Permits
No.Value No.Value No.Value No.Value No.Total Value
25 $116,967,661 7 $30,373,496 22 $8,843,970 301 $5,150,248 857 $161,335,376
505 101,123,404 16 6,348,156 33 34,470,188 390 5,377,325 944 147,319,073
564 118,932,283 1 8,741,532 16 14,065,511 546 7,084,420 1,127 148,823,745
475 78,906,931 26 10,004,782 46 31,113,577 339 5,068,547 886 125,093,837
376 57,526,!27 15 16,635,694 9 3,717,968 474 5,301,519 874 83,181,308
Source:The City
Historical Taxable Retail Sales
The following table lists the taxable retail sales for all industries within the City and the County since 2001.
Figures shown are in (000’s).
Source:
Year CityofRenton King County
2005 $1,951,188 40,463,997
2004 1,853,297 37,253,104
2003 1,763,640 35,370,831
2002 1,677,825 35,159,213
2001 1,306,652 35,313,326
Washington State Department of Revenue
Major Employers - City of Renton and State of Washington
The top ten major employers based upon the number of employees in the City as of December 2005 are as
follows. The top ten employers in the City employ approximately 49.9% of the total employees working
with the City as of the 2005 city workforce estimates (35,600).
Employer
The Boeing Company
PACCAR
Valley Medical Center
Renton School District
City of Renton
ER Solutions
Young’s Columbia of Washington
Wal Mart
Fry’s Electronics
IKEA
Industry No. Employees % of Total
Aerospace & Computer Services 10,865 30.5%
Heavy Manufacturing 1,710 4.8
Healthcare 1,630 1.6
Education 1,348 3.8
Local Government 709 2.0
Loan Brokers 468 1.3
Beer/wine distributor 379 1.1
Retailer 377 1.1
Retail 343 1.0
Retail 339 1.0
Source: The City
A-8
The major employers in the State of Washington as of January 2005 for full-time employees are as follows:
Employer Type of Business Activity
1. The Boeing Company Aerospace Manufacturing
2. Microsoft Corporation*Software
3. University of Washington*Higher Education
4. The Krueger Co.Retail
5. United States Postal Services Mail Delivery
6. Starbucks Coffee*Retail
7. Providence Health System*Healthcare
8. Group Health Cooperative*Healthcare
9. Washington Mutual, Inc.*Financial Services
10. Home Depot, Inc.Retail
11. Weyerhauser Co.*Forestry Products
12. Costco Wholesale*Wholesale Warehouse
13. Cingular Wireless Telecommunications
14. Nordstrom, Inc.*Retail
15. Washington State University Higher Education
16. Macy’s Retail
17. Safeway, Inc.Retail
18. Sears Roebuck & Co.Retail
19. Safeco Corporation*Insurance
20. Swedish Health Service Healthcare
Employment
55 400
28 007
21 358
17 300
13 214
8 908
8 499
8 422
7 658
7,800
7,700
6,525
5 400
5 349
5 075
4 905
4881
4 173
3 700
3 583
* Headquartered in King County
Source: Economic Development Council of King County and Puget Sound Business Journal’s Book of Lists
A-9
Employment by Major Indust~.
The table below sets forth the total number of full-time and part-time employees in the County for the years
and industries as shown.
Employment by Place of Work:
Total Employment
By Type:
Wage and Salary
Proprietor
Farm
Non-Farm
By Industry:
Farm
Non-Farm
Private
Ag. Services, Forestry, Fish. & Other
Mining
Utilities
Construction
Manufacturing
Wholesale Trade
Retail Trade
Transportation and Warehousing
Information
Finance, Insurance & Real Estate
Real Estate, Rental and Leasing
Professional and Technical Services
Management of Companies
Administrative and Waste Services
Educational Services
Healthcare and Social Assistance
Art, Entertainment and Recreation
Accommodation and Food Services
Other Services
Govermnent & Government Enterprises
Federal/Civilian
Military
State and Local
2001 2002 2003 2004
1,437,294 1,396,814 1,386,772 1,407,313
1,225,246 1,179,964 1,164,149 1,174,680
212,048 216,850 222,623 232,333
1,314 1,316 1,267 1,250
210,734 215,534 221,356 231,083
2,209 2,158 2,091 2,011
1,435,085 1,394,656 1,384,681 1,405,002
1,270,291 1,225,582 1,214,919 1,235,498
4,836 5,327 4,815 4,503
1,483 1,262 1,430 1,523
1,418 1,282 1,191 955
79,272 74,239 73,063 75,135
139,153 126,557 113,424 111,356
71,512 68,678 67,735 68,766
143,212 138,684 138,250 138,853
56,123 52,304 50,877 51,674
77,073 72,194 71,724 72,697
70,946 69,996 70,930 69,805
59,224 58,718 61,518 63,807
134,225 126,929 125,879 126,713
21,327 22,046 22,988 23,488
77,650 73,846 74,414 80,302
26,287 26,228 26,928 27,803
114,019 115,821 117,476 121,221
35,341 36,274 37,107 39,316
88,851 85,847 87,075 88,628
68,339 69,350 68,095 68,953
164,794 169,074 169,762 169,504
20,831 21,328 22,221 22,076
7,653 7,685 7,683 7,487
136,310 140,061 139,558 139,941
Source: U.S. Department of Commerce, Regional Economic Information System, Bureau of Economic
Analysis.
A-10
Labor Force and Unemployment
The following table shows labor force and employment data for the County since 2000 as well as
unemployment rates for the State and the United States for the same period.
Unemployment Rates
King State of
Year Labor Force Employment County Washington United States
2005 1,008,800 961,600 4.7%5.5%5.1%
2004 993,400 942,600 5.1 6.2 5.5
2003 984,700 923,300 6.2 7.4 6.1
2002 980,600 920,100 6.2 7.3 5.8
2001 986,100 936,100 5.1 6.2 4.8
2000 980,900 941,400 4.0 5.0 4.0
Source: Washington Employment Department and U.S. Department of Labor-Bureau of Labor Statistics
Personal Income Trends
The following table shows total and per capita personal income growth in the County from 1999 through
2004.
Total Personal Percent of Per Capita Percent of
Year Income (000’s)Change Income Change
2004 $87,617,622 11.6%$49,286 10.8%
2003 78,534,839 0.8 44,482 0.4
2002 77,940,608 1.4 44,313 1.1
2001 76,883,017 (3.2)43,842 (4.0)
2000 79,448,105 6.6 45,682 6.0
Source: U.S. Department of Commerce, Regional Economic Information Center, Bureau of Economic
Analysis
A-11
Earnings By Industry
The following table shows the County total personal income as well as wage and salary, labor and
proprietors’ earnings by major industry type for the years 2001 through 2004. Figures shown are in
thousands (O00’s).
Total Personal Income
Earnings by Industry
Farm
Non-Farm
Private
Ag. Serv., Forest., Fishing
Mining
Utilities
Construction
Manufacturing
Wholesale Trade
Retail Trade
Transportation and Warehousing
Information
Finance and Insurance
Real Estate, Rental and Leasing
Professional/Technical Services
Management of Companies/Enterprises
Educational Services
Healthcare and Social Assistance
Arts, Entertainment and Recreation
Accommodation and Food Services
Other Services
Gov’t & Gov’t Enterprises
Federal/Civilian
Military
State and Local
2001 2002 2003 2004
$76,883,017 $77,940,608 $78,534,839 $87,617,622
46,539 39,475 47,494 52,937
77,412,537 77,252,105 78,059,846 81,495,828
69,261,504 68,652,186 69,016,976 72,038,102
525,536 481,465 519,134 534,479
47,031 43,957 46,458 53,209
30,457 259,494 258,145 256,075
4,480,439 4,338,543 4,307,287 4,658,173
9,329,994 10,032,739 9,305,326 9,581,536
4,770,343 4,684,635 4,761,518 5,273,439
4,538,665 4,585,947 4,600,844 4,875,848
2,965,504 2,962,889 3,078,211 3,292,861
12,335,468 11,294,011 10,885,868 10,202,084
4,743,590 4,783,271 5,259,446 5,441,098
2,020,681 1,991,173 2,153,650 2,420,676
8,892,569 8,377,695 8,167,371 8,464,929
1,858,600 1,934,555 2,116,715 2,387,239
571,589 585,147 603,215 650,463
4,826,114 2,637,410 2,744,040 2,982,895
883,865 860,519 939,069 1,076,398
1,785,899 1,804,795 1,882,522 1,979,170
1,778,393 1,858,060 1,975,526 2,070,784
8,151,033 8,600,919 9,042,870 9,457,726
1,689,697 1,771,834 1,849,102 1,981,584
194,755 238,190 299,964 316,327
6,266,581 6,590,895 6,893,804 7,159,815
Source: U.S. Department of Commerce Regional Economic Information System Bureau of Economic
Analysis
A-12
APPENDIX B
Continuing Disclosure
Undertaking to Provide Continuing Disclosure
This section constitutes the City’s written undertaking for the benefit of the Owners and Beneficial Owners
of the Bonds required by subsection (b)(5)(i) of the Rule 15c2-12 (the "Rule") of the United States Securities
and Exchange Commission (the "SEC").
The City hereby agrees to provide or cause to be provided to each then existing NRMSIR, to the SID, if one
is created, and to the Bond Insurer the following annual financial information and operating data
(collectively, the "Annual Financial Information") for each prior fiscal year, commencing with the fiscal year
ending December 31, 2006, on or before the last day of the seventh month following the end of such prior
fiscal year:
(a) Annual financial statements prepared in accordance with the generally accepted
accounting principles applicable to governmental units, as such principles may be changed from time
to time and as permitted by State law; which statements will not be audited, except that if and when
audited financial statements are otherwise prepared and available to the City, they will be provided
(the "Annual Financial Statements");
(b)The assessed valuation of taxable property in the City;
(c)Ad valorem taxes due and the percentages of taxes collected;
(d)Property tax levy rates per $1,000 assessed valuation;
(e)A statement of authorized, issued and outstanding general obligation indebtedness of
the City; and
(f) A narrative explanation of the reasons for any amendments to this Section 17 made
during the previous fiscal year and the impact of such amendments on the Annual Financial
Information being provided.
In its provision of such financial information and operating data, the City may cross-reference to any "final
official statement" (as defined in the Rule) available from the Municipal Securities Rulemaking Board (the
"MSRB") documents theretofore provided to each then existing NRMSIR or the SID, if one is created.
If not submitted as part of the Annual Financial Information, then when and if available, the City shall
provide its Annual Financial Statements, which shall have been audited by such auditor as shall be then
required or permitted by the State law, to each then existing NRMSIR, to the SID, if one is created, and to
the Bond Insurer.
The City further agrees to provide or cause to be provided, in a timely manner, to the SID, if one is created,
and to either the MSRB or each then existing NRMSIR and to the Bond Insurer, notice of any of the
following events with respect to the Bonds, if material:
1.Principal and interest payment delinquencies;
2.Non-payment related defaults;
3.Unscheduled difficulties;
B-2
5.
6.
7.
8.
9.
Unscheduled draws on credit enhancements reflecting financial difficulties;
Substitution of credit or liquidity providers, or their failure to perform;
Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
Modification to rights of the Owners of the Bonds;
Optional redemptions of the Bonds;
Defeasances of the Bonds;
Release, substitution or sale of property securing repayment of the Bonds; and
Rating changes.
The City also agrees to provide or cause to be provided, in a timely manner, to the SID, if one is created, and
to either the MSRB or each then existing NRMSIR, notice of its failure to provide the Annual Financial
Information for the prior fiscal year on or before the last day of the seventh month following the end of such
prior fiscal year.
After the issuance of the Bonds, so long as the interests of the Owners or Beneficial Owners of the Bonds
will not be materially impaired thereby, as determined by a party unaffiliated with the City (including,
without limitation, a trustee for the Owners, nationally recognized bond counsel or other counsel familiar
with the federal securities law), or pursuant to a favorable "no-action letter" issued by the SEC, the
Undertaking to Provide Continuing Disclosure may only be amended in connection with any change in legal
requirements, change in law, or change in the identity, nature or status of the obligated person, or type of
business conducted, and only in such a manner that the undertaking of the City, as so amended, would have
complied with the requirements of the Rule at the time of the primary offering, after taking into account any
amendments or interpretations of the Rule, as well as any change in circumstances.
The City’s obligations to provide Annual Financial Information and notices of certain events shall terminate
without amendment upon the defeasance, prior redemption or payment in full of all of the then outstanding
Bonds. The Undertaking to Provide Continuing Disclosure or any provision hereof, shall be null and void if
the City (i) obtains an opinion of nationally recognized bond counsel or other counsel familiar with the
federal securities laws to the effect that those portions of the Rule which require the Undertaking to Provide
Continuing Disclosure or any such provision are invalid, have been repealed retroactively or otherwise do
not apply to the Bonds; and (ii) notifies and provides the SID, if any, and either the MSRB or each then
existing NRMSIR with copies of such opinion.
The right of each Owner or Beneficial Owner of Bonds to enforce the provisions of the Undertaking to
Provide Continuing Disclosure shall be limited to the right to obtain specific enforcement of the City’s
obligations herein, and any failure by the City to comply with the provisions of this undertaking shall not be
a default with respect to the Bonds under this Ordinance.
The City Finance and Information Services Administrator is authorized and directed to take such further
action on behalf of the City as may be necessary, appropriate or convenient to carry out the requirements of
the Undertaking to Provide Continuing Disclosure.
[This Page Intentionally Left Blank.]
APPENDIX C
Form of Legal Opinion
Form of Approving Opinion of
Gottlieb, Fisher & Andrews, PLLC,
Bond Counsel
[Date of Issue]
Mayor and City Council
City of Renton
Renton, Washington 98055
Ladies and Gentlemen:
We have acted as bond counsel in connection with the issuance by the City of Renton, Washington (the "City"), of
the bonds described below (the "Bonds"):
$
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
Dated: August 1, 2006
The Bonds are issued pursuant to Ordinance No. __ of the City (the "Bond Ordinance") and other
proceedings duly had and taken in conformity therewith. The Bonds are issued to provide part of the funds
necessary to pay the costs of constructing transportation and utility infrastructure and improvements in the South
Lake Washington Infrastructure project and the SW 27t~ Street Extension project, and to pay incidental costs
thereof and the costs related to the sale and issuance of the Bonds, all as provided in the Bond Ordinance.
The Bonds shall be issued in fully registered form as to both principal and interest; shall be in the
denomination of $5,000 each or any integral multiple thereof within a single maturity. The Bonds bear interest
(computed on the basis of a 360-day year of twelve 30-day months) from their date or from the most recent
interest payment date to which interest has been paid or duly provided for, whichever is later, payable
December 1, 2006, and semiannually thereafter on each June 1 and December 1 to the maturity or earlier
redemption thereof, at the rates set forth below, and shall mature on December 1 in each of the years and in the
principal amounts set forth below:
C-2
Maturity Date Principal Interest Rate
.(December 1)Amount Per Annum
), of
The Bonds shall be subject to redemption prior to maturity at the times and in the manner described in
the Bond Ordinance. The City has reserved the right to purchase any or all of the Bonds in the open market at
any time and at any price.
In rendering this opinion letter, we have examined the following: (i) the Bond Ordinance; (ii) a copy of
one executed and authenticated Bond (we assume that all other Bonds are in the same form and have been
similarly executed and authenticated); and (iii) the certified proceedings of the City and other certificates of
public officials and representatives of the City which have been furnished to us and which comprise the
transcript of proceedings pertaining to the issuance of the Bonds (the "Transcript").
As to questions of fact material to the opinions expressed herein, we have relied upon the certified
,uth proceedings of the City and other certificates of public officials and representatives of the City which have been
furnished to us as part of the Transcript, all without undertaking to verify the same by independent investigation.
st
e
Based only upon the foregoing and our examination of such questions of law as we have deemed
necessary or appropriate for the purpose of this opinion letter, and subject to the limitations and qualifications
expressed below, we are of the opinion that, as of this date:
1. The Bonds are lawfully authorized and issued pursuant to and in full compliance with the
constitution and statutes of the State and the Bond Ordinance.
2. The Bonds are legal, valid and binding general obligations of the City, enforceable against the
City in accordance with their terms, subject to bankruptcy, insolvency, reorganization, moratorium and other
similar laws affecting creditors’ rights, and also to the exercise of judicial discretion in accordance with general
principles of equity.
C-3
3. The City has irrevocably covenanted in the Bond Ordinance that, unless the principal of and
interest on the Bonds are paid from other sources, so long as the Bonds are outstanding, the City shall include in
its budgets and make annual levies of taxes within the constitutional and statutory tax limitations provided by
law without a vote of the qualified voters of the City upon all property within the City subject to taxation in
amounts which, together with any other money legally available therefor, shall be sufficient to pay such
principal and interest on the Bonds as the same shall become due. The City has irrevocably pledged its full
faith, credit and resources to the annual levy and collection of such taxes and for the prompt payment of such
principal and interest.
Y
t!
4. Assuming compliance by the City with applicable requirements of the Internal Revenue Code of
1986, as amended (the "Code), that must be met subsequent to the issuance of the Bonds, interest on the Bonds
is excludable from gross income for federal income tax purposes under existing federal law and is not an item of
tax preference for purposes of determining the federal alternative minimum tax imposed on individuals and
corporations under existing federal law. However, under existing federal law, interest on the Bonds is taken
into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax
imposed on certain corporations.
Except as stated in the preceding paragraph 4, we express no opinion as to any federal or state tax
consequences of receipt of interest on the Bonds.
The Code contains certain requirements that must be satisfied subsequent to the date of issuance of the
Bonds in order to maintain the exclusion of interest on the Bonds from gross income for federal income tax
purposes, including requirements relating to application of the proceeds of the Bonds, use of facilities financed
with such proceeds, limitations on income derived from the investment of gross proceeds of the Bonds (as
defined in Section 148 of the Code), and rebate to the United States Treasury of certain investment earnings on
such gross proceeds. The City has covenanted to comply with these requirements to the extent applicable, and
the opinion expressed in paragraph 4 assumes such compliance. However, we have not undertaken and do not
undertake to monitor compliance by the City with such requirements; and if the City should fail to comply with
such requirements, interest on the Bonds could become includable in gross income for federal income tax
purposes retroactive to the date of issuance of the Bonds.
We have not been engaged to participate in the preparation or review of, or to express any opinion
concerning the completeness or accuracy of, the official statement or other disclosure documentation used in
connection with the offer or sale of the Bonds, and thus express no opinion concerning the completeness or
accuracy thereof.
C-4
Copies of this opinion letter may be delivered to the Owners of the Bonds, who may rely on this opinion
letter as if it were addressed to such Owners on the date hereof. Subject to the foregoing, this opinion letter may
be relied upon by you only in connection with the issuance of the Bonds and may not be used or relied upon by
you or any other person for any other purpose whatsoever, without in each instance our prior written consent.
We expressly disclaim any responsibility to advise you or any Owners of any developments in areas covered by
this opinion letter that occur after the date hereof.
Respectfully submitted,
GOTTLIEB, FISHER & ANDREWS, PLLC
f:h-enmn~ltgo 02
By
Judith L. Andrews
C-5
[This Page Intentionally Left Blank.]
[This Page Intentionally Left Blank.]
OFFICIAL STATEMENT dated July 17, 2006
NEW ISSUE INSURANCE: MBIA Insurance Corporation
BOOK-ENTRY ONLY RATINGS: Standard and Poor’s: AAA (underlying: AA-)
Fitch Ratings: AAA (underlying: AA-)
(See "Municipal Bond Insurance" and "Ratings" herein.)
In the opinion of Bond Counsel, as of the Date of Issue, and assuming the City complies with applicable requirements of the Internal Revenue
Code of 1986, as amended (the "Code "), that must be satisfied subsequent to the issuance of the Bonds: interest on the Bonds, including any
original issue discount properly allocable to an owner thereof, is excluded from gross income for purposes offederal income taxation; and is not
an item of tax preference for purposes of determining the alternative minimum tax on individuals and corporations. However, such interest on the
Bonds, including any original issue discount properly allocable to an owner thereof, is taken into account in determining adjusted current
earnings for purposes of the computing the alternative minimum tax imposed on certain corporations. See "Tax Exemption" and "Other Tax
Consequences "’ herein.
$17,980,000
CITY OF NTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
DATED: August 1, 2006 DUE: December 1, as shown on the inside cover
The City of Renton, Washington (the "City") provides this Official Statement in connection with the issuance of its
Limited Tax General Obligation Bonds, 2006 (the "Bonds"). The Bonds mature on December 1 in each of the years and
amounts set forth on the inside cover herein, subject to optional redemption as hereinafter described, and will bear
interest from August 1, 2006, to their respective maturities or dates of prior redemption, at the rates per annum as shown
on the inside cover herein.
The Bonds will be issued as fully registered bonds under a book-entry system, initially registered to Cede & Co., as
nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository for
the Bonds. Individual purchases of Bonds will be made in the principal amount of $5,000, or integral multiples thereof
within a single maturity. The purchasers will not receive certificates representing their interest in the Bonds, as long as
the Bonds are in book-entry form. Interest will be payable semi-annually on June 1 and December 1, commencing
December 1, 2006. The Washington State Fiscal Agent, currently The Bank of New York will serve as registrar, paying
agent and transfer agent (the "Registrar") for the Bonds. For so long as the Bonds are held by DTC in book-entry
format, principal and interest payments will be made as described herein, see "The Bonds - Book-Entry System".
The Bonds are limited tax general obligations of the City. For as long as any Bonds are outstanding, the City has
irrevocably covenanted to include in its budgets and make annual levies of taxes within the constitutional and statutory
tax limitations provided by law without a vote of the qualified voters of the City upon all property within the City
subject to taxation in amounts which, together with any other money legally available therefor, shall be sufficient to pay
the principal and interest on the Bonds as the same shall become due. The Bonds do not constitute a debt or
indebtedness of King County, the State of Washington, or any political subdivision thereof other than the City.
The proceeds of the Bonds will be used for the purpose of providing funds for construction of transportation and utility
infrastructure and improvements (the "Project"), to pay capitalized interest and to pay costs related to the issuance of the
Bonds. (See "The Bonds - Purpose and Use of Proceeds" herein).
The Bonds maturing on and after December 1, 2017 are subject to optional redemption prior to maturity and Term
Bonds are subject to mandatory sinking fund redemption prior to maturity. (See "The Bonds - Security" and "The
Bonds - Purpose and Use of Proceeds" and "The Bonds - Redemption" herein.)
Payment of the principal of and interest on the Bonds when due will be insured by a municipal bond insurance policy to
be issued by MBIA Insurance Corporation simultaneously with the delivery of the Bonds.
The Bonds are offered by the Underwriter when, as and if issued by the City, subject to the opinion as to legality and
tax-exemption of the Bonds by Gottlieb, Fisher & Andrews, PLLC, Bond Counsel, Seattle, Washington. The fees of
Bond Counsel are contingent on the issuance of the Bonds. The Bonds, in book-entry form, are expected to be available
through the facilities of DTC for delivery by Fast Automated Securities Transfer on or about August 8, 2006.
This coverpage contains certain information for quick reference only. It is not a summary of this issue. Investors must
read the entire official statement to obtain information essential to making an informed investment decision.
D.A. DAVIDSON & CO.
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
MATURITY SCHEDULE
Dated: August 1, 2006
Due:December 1, as shown below
Interest Yield to Price
Year Amount Rate Maturity (% of Pa~CUSIP~
2008 $520,000 4.25%3.84%100.894% 760133QL5
2009 540,000 4.25 3.88 101.135 760133QM3
2010 565,000 3.90 3.95 99.799 760133QN1
2011 585,000 4.25 3.99 101.229 760133QP6
2012 610,000 5.00 4.03 105.354 760133QQ4
2013 640,000 4.50 4.10 102.500 760133QR2
2014 670,000 5.25 4.17 107.516 760133QS0
2015 700,000 5.25 4.24 107.698 760133QT8
2016 750,000 4.30 4.27 100.242 760133QU5
2017 775,000 5.00 4.33 105.519 760133QV3
$1,670,000, 5.00% Term Bond Due December 1, 2019 to Yield 4.49%, Price 104.167%, CUSIP1 760133QX9
2020 900,000 5.00 4.51 103.999 760133QY7
2021 945,000 5.00 4.54 103.748 760133QZ4
2022 1,000,000 5.25 4.48 106.297 760133RA8
2023 1,040,000 5.25 4.50 106.127 760133RB6
2024 1,095,000 5.25 4.51 106.042 760133RC4
$4,975,000, 5.00% Term Bond Due December 1, 2028 to Yield 4.72%, Price 102.258%, CUSIP1 760133RG5
1 The CUSIP numbers are included above for convenience of the holders and potential holders of the Bonds. No assurance
can be given that the CUSIP numbers for the Bonds will remain the same after the date of issuance and delivery of the Bonds.
CITY OF RENTON
1055 South Grady Way
Renton, Washington 98055
(425) 430-6858
www.ci.renton.wa.us"
Members of the City Council:
Mayor ........................: ...................................................................................Kathy Keolker
Council Members ......................................................................Randall Corman, President
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
Certain Appointed City Officials:
Chief Administrative Officer ........................................................................Jay Covington
Finance and Information Services Administrator ...................................Michael E. Bailey
City Attorney ............................................................................................Lawrence Warren
City Clerk .....................................................................................................Bonnie Walton
Underwriter
D. A. DAVIDSON & CO.
Columbia Center
701 5t~ Avenue, Suite 3100
Seattle, Washington 98104
888-389-8001
Bond Counsel
Gottlieb, Fisher & Andrews, PLLC
520 Pike Street, Suite 2510
Seattle, Washington 98101
Financial Advisor
Seattle-Northwest Securities Corporation
1420 Fifth Avenue, Suite 4300
Seattle, Washington 98101
* Neither the information on the City’s website nor any links from that website, is a part of this Official Statement, and such
information cannot be relied upon to be accurate as of the date of this Official Statement, nor should any such information be
relied upon to make investment decisions regarding the Bonds.
No dealer, broker, salesman or other person has been authorized by the City to give any information or to
make any representations, other than those contained in this official statement, and if given or made, such
other information or representations must not be relied upon as having been authorized by the City. The
information in this official statement was obtained from sources believed to be reliable, but is not guaranteed
as to accuracy or completeness. The information and expressions of opinion herein are subject to change
without notice and neither the delivery of the official statement nor any sale made hereby shall, under any
circumstances, create any implication that there has been no change in the affairs of the City since the date
thereof.
The Underwriter has reviewed the information in the Official Statement in accordance with, as a part of, their
respective responsibilities under the federal securities laws as applied to the facts and circumstances of this
transaction, but the Underwriter does not guarantee the accuracy or completeness of the information. The
information and expressions of opinion herein are subject to change without notice, and neither the delivery of
this Official Statement nor any sale hereunder shall create any implication that there has been no change in the
financial condition or operations of the City described herein since the date hereof. This Official Statement
contains, in part, estimates and matters of opinion that are not intended as statements of fact, and no
representation or warranty is made as to the correctness of such estimates and opinions or that they will be
realized.
The following descriptions of summaries of the bonds and Bond Ordinance and all references to other
documents or materials not claiming to be quoted in full are only brief outlines of some of the provisions and
do not claim to summarize or describe all provisions thereof. Copies of such documents may be obtained
from the issuer, bond counsel or Underwriter.
THE BONDS HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED. IN MAKING AN
INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE
ISSUER AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED.
THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE
SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING
AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF
THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
In connection with the offering and issuance of the Bonds, the Underwriter may over-allot or effect
transactions which stabilize or maintain the market price of the Bonds at a level above that which might
otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time.
Certain statements included or incorporated by reference in this Official Statement constitute "forward-
looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995,
section 21E of the United States Securities Act of 1934, as amended, and Section 27A of the United States
Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such
as "plan," "expect," "estimate," "projection, .... budget" or other similar words.
TABLE OF CONTENTS
SUMMARY STATEMENT ......................................................................................................................................1
THE BONDS .............................................................................................................................................................2
Description of the Bonds ...................................................................................................................................2
Registrar and Paying Agent ...............................................................................................................................2
Redemption ........................................................................................................................................................3
Transfer and Exchange of Bonds Upon Discontinuance of Book-Entry System ...............................................4
Purchase of the Bonds ........................................................................................................................................4
Book-Entry System ............................................................................................................................................4
Authorization .....................................................................................................................................................6
Purpose and Use of Proceeds .............................................................................................................................7
Security ..............................................................................................................................................................7
Statutory Debt Limitations .................................................................................................................................8
Property Tax Levy Limitations ..........................................................................................................................9
Initiative and Referendum ................................................................................................................................10
Property Tax Levy Procedures .........................................................................................................................11
Tax Levies .......................................................................................................................................................13
Property Tax Collections .................................................................................................................................13
Trends in Tax Receipts ....................................................................................................................................14
Major Taxpayers ..............................................................................................................................................14
Trends in Assessed Valuations ........................................................................................................................15
Authorized Investments ...................................................................................................................................15
CITY FINANCIAL INFORMATION ............................................................................................................16
Direct Debt and Estimated Overlapping General Obligation Debt ..................................................................16
General Obligation Debt Ratios .......................................................................................................................16
Future Financing ..............................................................................................................................................17
Debt Repayment Record ..................................................................................................................................17
Debt Limitation Calculation .............................................................................................................................17
Schedule of Limited Tax General Obligation Bond Debt Service ...................................................................18
Auditing of City Finances ................................................................................................................................19
The Budgetary Process ....................................................................................................................................19
Historical and Budgeted General Fund Operating Results ...............................................................................20
THE CITY ................................................................................................................................................................22
General Information .........................................................................................................................................22
Form of Local Government ...................................................................................2 .........................................22
Principal City Officials ....................................................................................................................................22
City Employment and Primary Services ..........................................................................................................23
Employee Relations .........................................................................................................................................23
Pension Plans ...................................................................................................................................................23
Risk Management ............................................................................................................................................27
APPROVAL OF BOND COUNSEL .......................................................................................................................27
TAX EXEMPTION .................................................................................................................................................27
OTHER FEDERAL TAX MATTERS .....................................................................................................................28
NO LITIGATION CONCERNING THE BONDS ..................................................................................................29
UNDERWRITING ...................................................................................................................................................29
MUNICIPAL BOND INSURANCE ........................................................................................................................29
RATINGS ................................................................................................................................................................33
NO CONFLICTS OF INTEREST ...........................................................................................................................33
COMMITMENT TO PROVIDE CONTINUING DISCLOSURE ..........................................................................33
ADDITIONAL INFORMATION AND MISCELLANEOUS .................................................................................34
APPROVAL OF OFFICIAL STATEMENT ...........................................................................................................34
APPENDIX A - ECONOMIC AND DEMOGRAPHIC INFORMATION ...........................................................A-1
Local Economic Overview .............................................................................................................................A-2
Aircraft Manufacturing - The Boeing Company ...........................................................................................A-2
Technology ....................................................................................................................................................A-3
Transportation ................................................................................................................................................A-3
Fishing, Agriculture and Forest Products .......................................................................................................A-5
Higher Education ...........................................................................................................................................A-5
Services, Tourism, Recreation and Conventions ............................................................................................A-5
Population Trends ..........................................................................................................................................A-7
Trends in Building Permits ............................................................................................................................A-7
Historical Taxable Retail Sales ......................................................................................................................A-8
Major Employers - City of Renton and State of Washington ........................................................................A-8
Employment By Major Industry ...................................................................................................................A-10
Labor Force and Unemployment .................................................................................................................A-11
Personal Income Trends ...............................................................................................................................A-11
Earnings By Industry ...................................................................................................................................A-12
APPENDIX B - CONTINUING DISCLOSURE ...................................................................................................B-1
APPENDIX C - FORM OF LEGAL OPINION ....................................................................................................C-1
APPENDIX D - MUNICIPAL BOND INSURANCE POLICY SPECIMEN .............-: ........................................D-1
ii
$17,980,000
City of Renton, Washington
Limited Tax General Obligation Bonds, 2006
SUMMARY STATEMENT
The following summary is qualified in its entirety by reference to the detailed information appearing
elsewhere in this Official Statement. No person is authorized to detach this Summary Statement from this
Official Statement or to otherwise use it without this entire Official Statement.
ISSUER ..................................The City of Renton (the "City") is located approximately 20 miles southeast
of the City of Seattle and approximately 60 miles northeast of the City of
Olympia, the State’s capital. The City had a population of 58,360 as
estimated in 2006 by the State of Washington (the "State") Office of
Financial Management. (See "The City of Renton" herein.)
INTEREST AND
REDEMPTION .....................Interest on the Bonds is payable semi-annually each June 1 and
December 1, commencing December 1, 2006. The Bonds maturing on and
after December 1, 2017 are subject to optional redemption prior to maturity
and the Term Bonds are subject to mandatory sinking fund redemption prior
to maturity. (See "The Bonds - Description of the Bonds" and "The Bonds -
Redemption" herein.)
AUTHORITY
FOR ISSUANCE ...................The Bonds will be issued in accordance with the provisions of the
Constitution and laws of the State of Washington, particularly chapters
35.37 and 39.46 RCW, and pursuant to Ordinance No. 5215 of the City (the
"Bond Ordinance"), adopted on July 17, 2006, authorizing the issuance of
Bonds. (See "The Bonds - Authorization" herein.)
SOURCE OF
REPAYMENT .......................The Bonds are limited tax general obligations of the City. For as long as
any of the Bonds are outstanding, the City irrevocably has covenanted to
include in its budgets and to make annual levies of taxes within the
constitutional and statutory tax limitations provided by law without a vote of
the qualified voters of the City upon all property within the City subject to
taxation in amounts which, together with any other money legally available
therefor, shall be sufficient to pay the principal and interest on the Bonds as
the same shall become due. The full faith, credit and resources of the City
have been irrevocably pledged to the annual levy and collection of such
taxes and for the prompt payment of such principal and interest. (See "The
Bonds - Security" herein.)
USE OF
PROCEEDS ...........................The proceeds of the Bonds will be used for the purpose of providing for
construction of transportation and utility infrastructure and improvements
(the "Project"), to pay capitalized interest and paying costs related to the
issuance and sale of the Bonds. (See "The Bonds - Purpose and Use of
Proceeds" herein.)
THE BONDS
Description of the Bonds
The Bonds will be issued in the aggregate amount of $17,980,000 in fully registered form, will be in the
denomination of $5,000 each or any integral multiple thereof within a single maturity and will be dated
August 1, 2006. The Bonds shall mature on December 1 in the years and amounts set forth on the inside cover
hereof.
The Bonds will bear interest from August 1, 2006, or the most recent interest payment date to which interest
has been paid or duly provided for, whichever is later, at the rates per annum set forth on the inside cover
hereof. Interest on each Bond will be calculated on the basis of a 360-day year consisting of twelve 30-day
months, and will be payable semi-annually on June 1 and December 1, commencing December 1,2006, until
the date of maturity or the date of prior redemption of such Bond, whichever occurs first. For so long as the
Bonds are held by DTC in book-entry form, principal and interest payments will be made as described herein
under the heading "The Bonds - Book-Entry System".
Registrar and Paying Agent
The City has adopted the system of registration for the Bonds approved, from time to time, by the State
Finance Committee of the State of Washington. Pursuant to RCW Chapter 43.80, the Committee designates
one or more fiscal agencies for bonds issued within the State of Washington. The Washington State Fiscal
Agent, currently The Bank of New York, in New York, New York, will serve as registrar, paying agent and
transfer agent (the "Registrar") for the Bonds.
In order to meet payment requirement for interest on and principal of the Bonds as the same becomes due and
payable, the City will remit money from the City’s Bond Fund to the Registrar. So long as Cede & Co. is the
registered owner of the Bonds, the principal of and interest on the Bonds are payable by wire transfer to Cede
& Co., as nominee for DTC which, in turn, is to remit such amounts to the Direct Participants for subsequent
disbursement to the Beneficial Owners. See "Book-Entry System" herein. In the event that Cede & Co. is no
longer the registered owner of the Bonds, interest on the Bonds will be paid by check or draft mailed by the
Registrar on or before the interest payment date at the address shown for the registered owners of the Bonds,
(the "Owners") on the registration books ("Bond Register") maintained by the Registrar as of the 15th day of
the month preceding the interest payment date; provided, however, that if so requested in writing by the
Owner of at least $1,000,000 principal amount of Bonds, interest will be paid by wire transfer on the interest
payment date to an account with a bank located in the United States. Principal of the Bonds will be paid to
registered owners upon presentation and surrender of the Bonds at maturity or upon earlier redemption at the
principal corporate trust office of the Registrar in New York, New York, or, under the terms of the current
fiscal agency agreement, for Bonds owned by Owners in the State, upon presentation at any office of Wells
Fargo Bank, N.A. in the State.
Redemption
Optional Redemption. The Bonds maturing on or after December 1, 2017 are subject to redemption at the
option of the City on or after December 1, 2016, in whole or in part at any time (maturities to be selected by
the City and by lot within a maturity in such manner as the Registrar shall determine), at any time, at the price
of par plus interest accrued to the date of redemption.
The Bonds in denominations larger than $5,000 may be redeemed in part in any integral multiple of $5,000. If
the Bonds are no longer in book-entry form, the Owner of any Bond redeemed in part shall receive, upon
surrender of such Bond to the Registrar, one or more new Bonds in authorized denominations equal in
principal amount to the unredeemed portion of the Bond so surrendered.
Mandatory Sinking Fund Redemption -2019 and 2028 Term Bonds. The Bonds maturing on December 1,
in the years 2019 and 2028 are Term Bonds and, if not previously purchased by the City in the open market or
optionally redeemed, is subject to mandatory sinking fund redemption prior to maturity, in part, by lot in such
manner as the Registrar shall determine, at par plus accrued interest to the date of redemption, on December 1
in the following years and in the following mandatory sinking fund redemption amounts:
Date
December 1, 2018
December 1, 2019~
Mandatory Sinking Fund Redemption
Redemption Amount
$815,000
855,000
Date
December 1, 2025
December 1, 2026
December 1, 2027
December 1, 20281
Redemption Amount
$1,155,000
1,210,000
1,275,000
1,335,000
~ Maturity
Selection of Bonds to be Redeemed. If fewer than all of the Bonds of like maturity are called for redemption,
the particular Bonds or portions of Bonds within a maturity to be redeemed will be selected by the Registrar
by lot or in such other manner as is determined by the Registrar; provided, that for so long as the book-entry
system is being used, the particular Bonds or portions thereof to be redeemed within a maturity will be
selected by DTC and, in turn, the DTC Participants in such manner as DTC and the DTC Participants may
determine; provided further, however, that the portion of any Bond of a denomination of more than $5,000 to
be redeemed will be in the principal amount of $5,000 or a multiple thereof, and that, in selecting portions of
such Bonds for redemption, the Registrar, DTC and the DTC Participants will treat each such Bond as
representing that number of Bonds of a $5,000 denomination which is obtained by dividing the principal
amount of such Bond to be redeemed in part by $5,000. While the Bonds are in book-entry form, the
Registrar shall give, or cause to be given, notice of a call for redemption of any bond to DTC, in accordance
with the Letter of Representations between the City and DTC. The City cannot and does not give any
assurances that DTC, its direct participants or others will distribute any redemption notices to the beneficial
owners or that they will do so on a timely basis. See "The Bonds - Book-Entry Sygtem" below for a discussion
of how redemption notices will be given by DTC to the beneficial owners of the Bonds. If the Bonds are no
longer in book-entry form, the Bond Ordinance requires that such notice be sent to Owners of the Bonds to be
redeemed no more than 60 days, nor less than 30 days, before the scheduled redemption date.
3
Pursuant to the City’s continuing disclosure undertaking, the City is required to provide timely notice of bond
calls to each NRMSIR (or MSRB) and to any SID. See "Commitment to Provide Continuing Disclosure"
herein for definitions of the terms "NRMSIR, ....MSRB" and "SID" and a description of the City’s
undertaking to provide certain notices.
Effect of Redemption~ If notice of redemption to the Owners has been given and the City has set aside
sufficient money for the payment of all Bonds call for redemption, the Bonds shall cease to accrue interest
after the redemption date and the Bonds called for redemption shall not be deemed to be outstanding under the
Bond Ordinance.
Transfer and Exchange of Bonds Upon Discontinuance of Book-Entry System
So long as the Bonds are in book-entry only form, the beneficial ownership of the Bonds may only be
transferred in the records established and maintained by DTC. Upon discontinuance of the book-entry system,
the Bonds may be transferred by Owners upon completion of the assignment form on the Bond(s) in form and
substance satisfactory to the Registrar and delivery of the Bond(s) to be transferred to the principal corporate
trust office of the Registrar for cancellation and re-issuance. Upon such surrender, the Registrar will cancel
the surrendered Bonds and deliver to the new Owner a new Bond or Bonds of the same maturity and interest
rate and for the same aggregate principal amount. Upon discontinuance of the book-entry system, any Bond
may be surrendered at the principal corporate trust office of the Registrar and exchanged, without charge, for
an equal aggregate principal amount of Bonds, in any authorized denomination. The Registrar is not required
to transfer or exchange Bonds during the 15 days preceding any principal or interest payment date.
Purchase of the Bonds
The City has reserved the right to purchase any of the Bonds on the open market at any time and at any price.
Bonds purchased by the City will be canceled.
Book-Entry System
When the Bonds are issued, ownership interest will be available to purchasers only through a book-entry
system (the "Book-Entry System") maintained by DTC or such other depository institution designated by the
City pursuant to the Bond Ordinance. If the Bonds are removed from the Book-Entry System and delivered to
the Owners in physical form, as described below, the discussion herein of the Book-Entry System will not
apply. The following information has been provided by DTC, and the City makes no representation as to the
accuracy or completeness thereof.
The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the
Bonds. The Bonds will be issued as fully registered securities registered in the name of Cede & Co.
(DTC’ s parmership nominee) or such other name as may be requested by an authorized representative
of DTC. One fully registered bond certificate will be issued for each maturity of the Bonds, each in
the aggregate principal amount of such maturity, and will be deposited with DTC.
4
DTC, the world’s largest depository, is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York
Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 2
million issues of U.S. and non-U.S, equity issues, corporate and municipal debt issues, and money
market instruments from over 85 countries that DTC’s participants ("Direct Participants") deposit with
DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other
securities transactions in deposited securities through electronic computerized book-entry transfers and
pledges between Direct Participants’ accounts. This eliminates the need for physical movement of
securities certificates. "Direct Participants" include both U.S. and non-U.S, securities brokers and
dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a
wholly-owned subsidiary of The Depository Trust & Clearing Corporations ("DTCC"). DTCC, in
turn, is owned by a number of Direct Participants of DTC and Members of the National Securities
Clearing Corporation, Government Securities Clearing Corporation, MBS Clearing Corporation, and
Emerging Markets Clearing Corporation, (NSCC, GSCC, MBSCC, and EMCC, also subsidiaries of
DTCC), as well as by the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and
the National Association of Securities Dealers, Inc. Access to the DTC system is also available to
others, such as U.S. and non-U.S, securities brokers and dealers, banks, and trust companies, and
clearing corporations that clear through or maintain a custodial relationship with a Direct Participant,
either directly or indirectly ("indirect Participants"). DTC has Standard and Poor’s highest rating:
AAA. The DTC rules applicable to its Participants are on file with the Securities and Exchange
Commission. More information about DTC can be found at www.dtcc.com.
Purchases of Bonds under the DTC system must be made by or through Direct Participants, which will
receive a credit for the Bonds on DTC’s records. The ownership interest of each actual purchaser of
each Bond ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants’
records. Beneficial Owners are, however, expected to receive written confirmation from DTC of their
purchase, but Beneficial Owners are expected to receive written confirmations providing details of the
transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant
through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in
the Bonds are to be accomplished by entries made on the books of Direct or Indirect Participants
acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in Bonds, except in the event that use of the book-entry system for the Bonds
is discontinued.
To facilitate subsequent transfers, all Bonds deposited by Participants with DTC are registered in the
name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an
authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name
of Cede & Co., or such other DTC nominee, do not effect any change in beneficial ownership. DTC
has no knowledge of the actual Beneficial Owners of the Bonds; DT~’s records reflect only the
identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not
be the Beneficial Owners. The Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
10.
11.
Conveyances of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
Redemption notices, if any, shall be sent to DTC. If less than all of the Bonds within an issue are
being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct
Participant in such issue to be redeemed.
Neither DTC nor Cede & Co. (nor such other DTC nominee), will consent or vote with respect to
Bonds unless authorized by a Direct Participant in accordance with DTC’s Procedures. Under its
usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date.
The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to
whose accounts Bonds are credited on the record date (identified in a listing attached to the Omnibus
Proxy).
Redemption proceeds, distributions, and dividend payments on the Bonds will be made to Cede & Co.,
or such other nominee as may be requested, by an authorized representative ofDTC. DTC’s practice
is to credit Direct Participants’ accounts, upon DTC’s receipt of funds and corresponding detail
information from the City on the payable date in accordance with their respective holdings shown on
DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing
instructions and customary practices, as is the case with securities held for the accounts of customers
in bearer form or registered in "street name," and will be the responsibility of such Participant and not
of DTC or the City, subject to any statutory or regulatory requirements as may be in effect from time
to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or
such other nominee as may be requested by an authorized representative of DTC) is the responsibility
of the City, disbursement of such payments to Direct Participants shall be the responsibility of DTC,
and disbursement of such payments to Beneficial Owners shall be the responsibility of Direct and
Indirect Participants.
DTC may discontinue providing its services as securities depository with respect to the Bonds at any
time by giving reasonable notice to the City. Under such circumstances, in the event that a successor
securities depository is not obtained, Bond certificates are required to be printed and delivered.
The City may decide to discontinue use of the system of book-entry transfers through DTC (or a
successor securities depository). In that event, Bond certificates will be printed and delivered.
The information in this section concerning DTC and DTC’s book-entry system has been obtained from
sources that the City believes to be reliable, but the City takes no responsibility for the accuracy
thereof.
Authorization
The Bonds will be issued pursuant to the provisions of the Constitution and laws of the State of Washington,
particularly chapters 35.37 and 39.46 RCW and Ordinance No. 5215 (the "Bond Ordinance"), adopted by the
City Council on July 17, 2006.
Purpose and Use of Proceeds
The proceeds of the Bonds will be used for the purpose of paying the costs of the Project and costs of the
issuance and sale of the Bonds.
The Project will generally consist of improvements to Logan Avenue North, Park Avenue North, North 8tu
Street and North 10t~ Street all in relationship to private investments made to develop properties in the area
into a regional retail project. In addition, proceeds will be used to augment the construction budget of
roadway improvements on 217t~ and Strander Boulevard. Proceeds of the Bonds will also be used to pay a
portion of interest on the Bonds during the Project construction period.
The estimated sources and application of funds are shown in the table that follows.
Sources of Funds:
Par Amount of the Bonds ........................................................................
Original Issue Premium ..........................................................................
EDA Grant ..............................................................................................
Accrued Interest from 8/1/06 to 8/8/06 ...................................................
Total Sources of Funds ........................................................................
$17,980,000.00
660,506.35
2,000,000.00
17,174.50
$20,657,680.85
Application of Funds:
Deposit to the Project Construction Fund ...............................................
Deposit to the Debt Service Fund (Accrued Interest 8/1/06 to 8/8/06)...
Costs of Issuance~ ....................................................................................
Total Application of Funds
$20,415,154.22
17,174.50
225,352.13
$20,657,680.85
1 Includes the Undenvriter’s discount, municipal bond insurance premium, Bond Counsel fees, financial advisor fees, rating agency fees,
registration costs, printing expenses and any miscellaneous costs.
Security
General Ad Valoretn Tax Pledge. The Bonds are limited tax general obligations of the City. Unless the
principal of an interest on the Bonds are paid from other sources, so long as the Bonds are outstanding, the
City has covenanted in the Bond Ordinance to include in its budgets and to make annual levies of taxes within
the constitutional and statutory limitations provided by law without a voted of the qualified voters of the City
upon all property within the City subject to taxation in amounts which, together with other money legally
available and to be used therefor, will be sufficient to pay the principal of and interest on the Bonds. The full
faith, credit and resources of the City have been irrevocably pledged for the annual levy and collection of
those taxes and the prompt payment of such principal and interest.
The Bonds are not obligations of King County, the State of Washington or any municipal corporation
other than the City.
7
Limitation on Sources of Payment for the Bonds. Limited tax general obligation bonds, such as the Bonds,
are payable solely from amounts on deposit in the City’s Bond Fund, together with any other money of the
City legally available to pay debt service on such bonds. The City is not authorized to levy any additional or
excess tax for purposes of repaying its limited tax general obligation bonds. The primary source of funds to
repay such bonds are the City’s regular property tax and various excise taxes. See"The Bonds- Property Tax
Limitations" and "The Bonds - Property Tax Levy Procedure" herein for a discussion of the City’s regular
property tax collection procedures and limitations thereon. Because regular property tax revenues are used to
operate City government, a pledge to repay limited tax general obligation bonds directly affects a City’s
operating budget. Consequently, any money budgeted to pay debt service on limited tax general obligation
bonds is necessarily unavailable for other City services.
Statutory Debt Limitations
The power of the City to contract debt of any kind is controlled and limited by state law. All debt must be set
forth in accordance with detailed budget procedures and paid out of identifiable receipts and revenues. The
budget must be balanced for each fiscal year. It is unlawful for an officer or employee of the City to incur
liabilities in excess of budgetary appropriations.
The amount of indebtedness that a city may legally incur is limited by the Constitution and laws of the State.
For State law purposes, "debt" generally includes any unconditional obligation that is generally payable from
and secured by a pledge of tax revenues.
The debt limitations applicable to cities are set forth in terms of debt for general purposes and debt for special
purposes. Without the approval of its voters, a city may incur debt in the aggregate amount of up to 1 ½% of
the city’s assessed valuation. Upon the approval of 60% of the city’s voters at an election at which 40% of the
number of those who voted at the last general election cast a ballot, a city can incur total indebtedness for
general purposes, including non-voted debt, in an amount not to exceed 2 ½% of the city’s assessed valuation.
In addition to the indebtedness authorized for general purposes, a city may incur debt for: (i) water, artificial
light and sewers in an amount not exceeding 2 ½% of the city’s assessed valuation; and (ii) open space, parks
and economic development in an amount not to exceed 2 ½% of the city’s assessed valuation. Before
incurring such additional indebtedness for special purposes, the city must receive the approval of 60% of its
voters at an election at which 40% of the number of those who voted at the last general election cast a ballot.
Accordingly, the aggregate general obligation indebtedness a citymay incur for general and special purposes
is equal to 7 ½% of its assessed valuation. For a discussion of the outstanding debt of the city, see "City
Financial Information - Debt Limit Calculation" herein.
In determining the total amount of indebtedness outstanding, a city is allowed to offset certain assets against
the aggregate amount of debt outstanding. Such assets include taxes and levies of the current year,
uncollected taxes that are not delinquent for longer than six years, and cash on hand and received for general
business purposes.
Property Tax Levy Limitations
The Bonds are secured by money received by the City from its regular property tax levy. There is no authority
for the City to levy taxes in excess of the regular property tax levy to pay principal of and interest on limited
tax general obligation bonds, such as the Bonds. Nonvoted regular property tax levies are subject to two
limitations more specifically described below. Regular property tax levy receipts may be used for the payment
of the principal of and interest on nonvoted general obligations and for any lawful City purpose. Under
existing laws and circumstances, none of the property tax limitations currently affect the ability of the City to
levy regular property taxes at rates sufficient to pay the debt service on its outstanding obligations.
Information relating to regular property tax limitations is based on existing statutes, constitutional provisions
and circumstances. Changes in the same could alter adversely the impact of other interrelated tax limitations
on the City.
City Maximum Rate Limitation. The regular property tax levy by any city cannot exceed $3.60 per $1,000 of
assessed value. Pursuant to RCW 84.52.043, cities may levy, without a vote of the residents residing therein,
a maximum of $3.375 per thousand for general city purposes (the "regular levy"). A city with full-time
firemen may levy an additional $0.225 per thousand to fund the city’s Fireman’s Pension Fund (RCW
41.16.060), thus creating a maximum annual levy rate of $3.60 per thousand dollars of assessed valuation.
The City is currently levying $3.04482 per thousand dollars of taxable assessed valuation for its regular levy
for collection year 2006. See "Certain City Financial Information - Tax Levies" herein for a summary of
historical tax levy rates in the City.
Limit Factor. Chapter 84.55 RCW places a limitation on the amount of tax levies by individual taxing
districts, including the City, defined by a statutorily defined "limit factor." All municipal "regular property
tax" levies are subject to this limitation. The law limits a municipality’s regular tax levy to an amount equal
to the highest propel~ tax levy of the three most recent years multiplied by a "limit factor" plus a full value
adjustment for new construction. Substantively, this means that the regular property tax levy ofa citymust be
set so that the property taxes payable in a given year (excluding new construction, improvements and State-
assessed property) will not exceed the amount levied by the city in the highest of the three most recent years
multiplied by the limit factor. Revenue generated by the regular property tax levy on new construction is not
affected by the levy limit.
The limit factor for the City is defined to be the lesser of 101% or 100% plus the previous year’s inflation rate,
but if the inflation rate is less than 1%, the City Council could increase the limit factor to 101% upon a finding
of substantial need. The limit factor may also be increased, regardless of inflation, if such increase is
authorized by the City Council upon a finding of substantial need and is also approved by the voters at a
general or special election within the City. Such election must be held less than twelve months before the date
on which the proposed levy will be made and any tax increase cannot be greater than described under the
heading "City Maximum Rate Limitation". A majority of those voting would be required for approval. The
new limit factor will be effective for taxes collected in the following year only; .however, the resulting levy
sets a new threshold upon which the limit factors are computed.
The limit factor in Chapter 84.55 RCW was approved by voters in 2001 as Initiative 747. On June 13, 2006,
a King County Superior Court judge struck down Initiative 747 as invalid. The State Attorney General’s
Office has stated that it plans to appeal the decision. However, it is unknown whether the ruling will be
appealed and, if it is, the City cannot predict the outcome of such appeal. See "The Bonds - Tax Levies"
herein for a summary of the City’s historical tax levy rates.
9
$5. 90/$1,000 Aggregate Non- VotedLevy Limitation. RCW 84.52.043 (2) imposes an aggregate limitation on
non-voted tax levies by all taxing districts, except the State, ports and public utility districts, of $5.90/$1,000
of assessed value. This statute also gives certain "senior" taxing districts, such as the City, a priority on the
permissible aggregate levy up to their maximum authorized levies as follows:
Incorporated Areas
Senior Maximum The City’s
Taxing Districts Levy Rate 2006 Levy
CountyI $1.800 $1.32869
City 3.375 3.04482
City Pension2 0.225 0.22500
Total $5.4003 $4.59851
Pursuant to RCW 84.52.043(1), a county may increase its levy fxom $1.80 to a rate not to exceed $2.475 for general county purposes if
(i) the total levies for both the county and any road district within the county do not exceed $4.05 and (ii) no other taxing district (such
as the City) has its levy reduced as a result of the increased county levy.
RCW 14.16.060. Not levied by cities incorporated after 1970.
The remaining $0.50/$1,000 is available for various other taxing and junior taxing districts, as described below.
Limitations on the Aggregate Taxes Levied for Junior Taxing Districts. The City is not a junior taxing
district; however, the following information is provided to further describe property tax laws in Washington.
In addition to the $3.60 levy rate limitation for cities and the 101% limitation described above, the constitution
and laws of the State impose other limitations on regular property taxes (as opposed to voter-approved excess
property taxes). For instance, the aggregate of all tax levies upon real and personal property by the State and
all taxing districts cannot exceed, in any year, one percent of the true and fair value of such property. In
addition, the aggregate regular levies of all taxing districts, other than the State, cannot exceed $5.90 per
$1,000 assessed valuation, unless certain limited exceptions apply. If either limitation on the aggregate
regular property tax is exceeded in a year, the county assessor must reduce the levy rates for various junior
taxing districts (not including the State, counties or cities) on a pro rata basis determined by statute. The City
is not a junior taxing district.
Uniformity Requirement Article VII, Section 1 of the Washington Constitution requires that property taxes
be levied at a uniform rate upon the same class of property within the territorial limits of a taxing district
levying such taxes. It is possible because of different overlapping taxing districts in different areas of the City
that the maximum permissible levy might vary within the City. In that event, to comply with the
constitutional requirement for uniformity of taxation, the lowest permissible rate for any part of the City
would be applied to the entire City.
Initiative and Referendum
Under the State Constitution, the voters of the State have the ability to initiate legislation and modify existing
legislation through the powers of initiative and referendum, respectively. The initiative power in Washington
may not be used to amend the State Constitution. Initiatives and referenda are submitted to the voters upon
receipt of a petition signed by at least eight percent (initiative) and four percent (referenda) of the number of
voters registered and voting for the office of Governor at the preceding regular gubernatorial election. Any
law approved in this manner by a majority of the voters may not be amended or repealed by the Legislature
10
within a period of two years following enactment, except by a vote of two-thirds of all members elected to
each house of the Legislature. After two years, the law is subject to amendment or repeal by the Legislature in
the same manner as other laws.
Future Initiative Legislation. Tax and fee initiative measures have been and may be filed, but it cannot be
predicted whether any such initiatives might gain sufficient signatures to qualify for submission to the
Legislature and/or the voters or, if submitted, whether they ultimately would be approved.
There are currently two initiative measures that, according to the latest reports, will likely qualify for
submission to the Legislature and/or voters pending the certification process by the Secretary of State’s Office.
Proposed Initiative 933 would require that a government to provide compensation when such government
regulation damages the use or value of private property, among other things. Proposed Initiative 917 would
cap motor vehicle registration charges at $30 and repeal taxes and fees exceeding the $30 limit, among other
things. Neither of the above-proposed initiatives will impact the levy and collection of property taxes by the
City, which are pledged to the payment of the principal of and interest on the Bonds. The City is unable to
predict if such initiatives will be approved by the voters. As of the date of this Official Statement the City is
uncertain of the potential impacts such initiatives would have on the City.
Property Tax Levy Procedures
The Bonds are payable from any money legally available for such purposes, including taxes levied generally
with limitation as to rate or amount, as described under the caption "The Bonds" - "Security" above. A
significant portion of the City’s operating revenues are derived from regular property taxes levied upon the
taxable property within the City’s boundaries. The City is limited in its ability to levy such taxes by various
constitutional and statutory provisions.
The City does not believe that these existing property tax limitations will have an impact on the City’s ability
to levy and collect taxes for the repayment of the Bonds.
Valuations and Assessments of Property for Taxation Purposes. The King County Assessor (the
"Assessor") determines the value of all real and personal property throughout King County (the "County"),
which is subject to ad valorem taxation. The Assessor is an elected official whose duties and methods of
determining value are prescribed and controlled by statute and by detailed regulations promulgated by the
State Department of Revenue. For tax purposes, the assessed value of property is set at 100% of its true and
fair value as of January 1 of each year. All taxable property is subject to revaluation at least once every four
years and to an on-site appraisal at least once every six years. The property is listed by the Assessor on a tax
roll at its current assessed value and the tax roll is filed in the Assessor’s office. The Assessor’s determination
is subject to revisions by the County Board of Equalization and, for certain property, subject to further
revisions by the State Board of Equalization. After all administrative procedures are completed, the City
receives the Assessor’s final certificates of assessed value of property within the County.
Property Tax Collection Procedures. Property taxes are levied in specific amounts, and the rate for all taxes
levied for all taxing districts in the County (including the City) are determined, calculated and fixed by the
Assessor based upon the assessed valuation of the property within the various taxing districts. The Assessor
extends the tax levied within each taxing district on a tax roll that contains the total amounts of taxes levied
and to be collected and assigns a tax account number to each tax lot. The tax roll is delivered to the King
11
County Finance Department, which is responsible for the billing and collection of taxes due for each account.
All taxes are due and payable on April 30 of each tax year, but if the amount due from a taxpayer exceeds filly
dollars, one-half may be paid then and the balance no later than October 31 of that year (except that the half to
be paid on April 30 may be paid at any time prior to October 31 if accompanied by penalties and interest
accrued until the date of payment).
The method of giving notice of payment of taxes due, the King County Finance Department’s accounting for
the money collected, the division of the taxes among the various taxing districts, notices of delinquency, and
collection procedure are all covered by detailed statutes.
Tax Liens and Foreclosure. Property taxes and all charges and expenses relating to the taxes constitute a
statutory lien on the property taxed. The lien attaches to the property from and including January 1 in the year
in which the tax is levied, and is discharged only when the taxes are paid. In other respects, and subject to the
"Homestead Exemption," the lien for delinquent property taxes is prior to all other liens or encumbrances of
any kind on real or personal property subject to taxation. The courts have not decided whether the Homestead
Law (chapter 6.13 RCW) may give the occupying homeowner a right in the forced sale of the family residence
for delinquent general property taxes to retain the first $40,000 of proceeds of any sale upon foreclosure (see
Algona v. Sharp, 30 Wn. App. 837, 638 P.2d 627 (1982), holding the homestead right superior to liens for
local improvement district assessments).
By law, the King County Finance Department must commence in superior court foreclosure of a tax lien on
real property after three years have passed since the first delinquency. The King County Finance Department
must sell the property to the highest and best bidder for cash upon entry of the order of foreclosure. The
minimum bid allowable is the total amount of the taxes, interest, penalty and costs due. To the extent property
is stricken to the City in a foreclosure sale, that property is exempt from taxation for so long as it is held by the
City. A property owner may redeem his property at any time prior to the foreclosure sale by paying the King
County Finance Department the amount of the certificate of delinquency and all taxes, interest and costs
accruing after the certificate of delinquency is issued, together with interest on such amount at the rate of 12%
per annum.
[The remainder of this page intentionally left blank.]
12
Tax Levies
The following tables show the representative ad valorem tax levies in dollars per $1,000 of assessable value
for property located in the City for the tax years shown. The total shown is equal to the aggregate number of
levies assessed against all property located in the City. See "The Bonds - Property Tax Levy Limitations"
herein for a description of the City’s maximum levy rate limitation of $3.60 per $1,000 of assessed value.
Tax Years
2004Taxing Entity 2002 2003 2005 2006
State of Washington $2.99 $2.90 $2.76 $2.69 2.50
King County 1.45 1.35 1.43 1.38 1.33
The City - Regular Levy 3.26 3.19 3.16 3.15 3.04
The City- Excess Levy 0.09 0.09 0.08 0.08 0.07
King County Library 0.53 0.55 0.54 0.53 0.53
Port of Seattle 0.19 0.26 0.25 0.25 0.23
Road 1.73 0.00 0.00 0.00 0.00
King County Hospital District 2 0.36 0.34 0.34 0.59 0.54
Renton School District 3.11 2.99 3.49 3.99 3.96
Fire District No. 10-1 0.09 0.08 0.08 0.07 0.06
Total $13.80 $11.75 $12.13 $12.73 $12.26
Source: King County Assessor’s Office
Property Tax Collections
Set forth in the following table are the total real and personal property and special tax levies and collections
for the City for the fiscal years 2001 through 2005. The following is provided to show recent trends in the
collection of property taxes within the City. Property taxes are due and payable on April 30 of each year
succeeding the levy. The entire tax or first half must be paid on or before April 30, and if not paid on a timely
basis, the total amount becomes delinquent on May 1. The second half of the tax is payable on or before
October 31, becoming delinquent November 1. The City applies delinquent taxes collected to the year in
which they are collected and not the year in which they were levied.
Current Taxes Percent Current
Tax Total Adjusted Collected in Collections In Total Taxes Percent Total
Year Tax Levy Year Levied Year Levied Collected~Collected~
2006 $22,209,409 $14,400,7352 64.8%~-n/a n!a
2005 21,654,069 21,632,695 99.9 $21,681,415 100.1%
2004 20,451,011 20,184,238 98.7 20,506,186 100.3
2003 19,486,858 19,149,258 98.3 19,430,~558 99.7
2002 18,581,814 18,285,908 98.4 18,561,605 99.9
2001 16,967,683 16,677,882 98.3 16,942,461 99.9
Includes the collection of current and delinquent taxes, penalties and interest.
Current tax collections for tax year 2006 are as of June 30, 2006.
Source: The City
13
Trends in Tax Receipts
Set forth in the following table is a breakdown of the taxes received by the City for all funds for the past five
fiscal years. Other taxes include leasehold excise tax, real estate excise tax and interest and penalties on real
and personal property taxes.
Year PropertyTaxes Sales Taxes Ut~ityTaxes OtherTaxes
2005 $21,618,590 $18,692,911 $9,585,293 $8,227,650
2004 20,110,105 18,071,140 8,957,389 8,286,408
2003 19,352,806 17,334,831 8,952,000 6,512,444
2002 18,381,694 16,431,456 8,669,865 6,418,832
2001 16,677,882 16,724,786 10,348,682 6,368,215
Source: The City
Major Taxpayers
The following table lists the ten largest taxpayers within the City based upon their 2006 assessed valuation.
Taxpayer
1.The Boeing Company~
2.PACCAR
3.Puget Sound Energy
5.AMB Property Corporation
6.Renton Properties LLC
8.Avalon Bay Communities, Inc.
4.Qwest
9.WalMart
7.Fred Meyer Stores, Inc.
10.Walton Renton Investors III
Total
Business
Aerospace & Computer Science
Heavy Manufacturing
Utility
Commercial Property Owners
2006 Assessed %of2006
ValuNion Assessed Valuation
$561,274,026 7.7%
106,646,760 1.5
79,178,508 1.1
43,670,400 0.6
Property Management
Apartment Building
Telecommunications
Retailer
Retailer
Commercial Property Owners
39,403,400 0.5
34,169,000 0.5
29,746,472 0.4
27,877,700 0.4
27,762,178 0.4
23,746,800 0.3
$973,475,244 13.3%
1 See "Appendix A - Economic and Demographic Information- Aircraft Manufacturing - The Boeing Company’’ for a further
description of the Boeing Company.
Source: King County Assessor’s Office
14
Trends in Assessed Valuations
Set forth in the following table are the historical and current assessed valuations of taxable property located
within the City. Assessed valuation within the City is based upon 100% of estimated actual valuation,
excluding senior citizens tax base.
Tax Total City Percent
Year Assessed Valuation Change
2006 $7,334,476,542 9.51%
2005 6,697,750,148 5.10
2004 6,372,632,122 6.50
2003 5,983,832,546 6.97
2002 5,593,880,488 N/A
Source: King County Assessor’s Office
Authorized Investments
General. Chapter 35.39 RCW limits the investment by cities and towns of its inactive funds or other funds in
excess of current needs to the following authorized investments: United States bonds; United States
certificates of indebtedness; bonds or warrants of the State and any local government in the State; its own
bonds or warrants of a local improvement district which are within the protection of the local improvement
guaranty fund law; and any other investment authorized by law for any other taxing district or the State
Treasurer. Under chapter 43.84 RCW, the State Treasurer may invest in non-negotiable certificates of deposit
in designated qualified public depositories; in obligations of the U.S. government, its agencies and wholly
owned corporations; in bankers’ acceptances; in commercial paper; in the obligations of the federal home loan
bank, federal national mortgage association and other government corporations subject to statutory provisions
and may enter into repurchase agreements. Utility revenue bonds and warrants of any city and bonds or
warrants of a local improvement district are also eligible investments (RCW 35.39.030).
Money available for investment may be invested on an individual fund basis or may, unless otherwise
restricted by law, be commingled within one common investment portfolio. All income derived from such
investment may be either apportioned to and used by the various participating funds or for the benefit of the
general government in accordance with city ordinances or resolutions. Funds derived from the sale of bonds
or other instruments of indebtedness will be invested or used in such manner as the authorizing ordinances,
resolutions or bond covenants may lawfully prescribe.
BondProeeeds, In addition to the eligible investments discussed above, bond proceeds may also be invested
in mutual funds with portfolios consisting of U.S. government and guaranteed agency securities with average
maturities of less than four years; municipal securities rated in one of the four highest categories; and money
market funds consisting of the same, so long as municipal securities held in the fund(s) are in one of the two
highest rating categories of a nationally recognized rating agency. Bond proceeds may also be invested in
shares of money market funds with portfolios of securities otherwise authorized by law for investment by local
governments (RCW 39.59.030). At this time, there are no funds that qualify under State law for this type of
investment.
15
CITY FINANCIAL INFORMATION
Direct Debt and Estimated Overlapping General Obligation Debt
The following information sets forth the general obligation indebtedness of the City as of January 1, 2006,
(adjusted to reflect the issuance of the Bonds) and of taxing entities with boundaries that overlap with the
City.
Direct General Obligation Debt:
Voted General Obligation Bonds Outstanding ...............................................$1,440,000
Non-Voted General Obligation Bonds Outstanding ......................................26,831,734
The Bonds (Non-Voted) ...............................................................................17,980,000
Loans1 ..............................................................................................................1,989,217~
Installment Contract ......................................................................................81,218
Direct Debt of the City ...............................................................................................................$48,322,169
Estimated Overlapping General Obligation Debt:
School District No. 403 (Renton)
School District No. 411 (Issaquah)
School District No. 415 (Kent)
Port of Seattle
King County Library
King County
Fire District No. 10-1
Total Estimated Overlapping Debt
Total Direct Debt
Total Direct and Overlapping Debt
General Obligation Outstanding Debt Chargeable to
Bonds Property Within the City
Outstanding Percent Amount
$212,085,000 55.30%$117,283,005
198,075,000 1.17 2,317,478
221,636,400 0.01 22,164
434,555,000 2.71 11,776,441
86,295,000 0.36 310,662
900,160,000 2.71 24,394,336
2,080,000 0.36 7,401
$156,111,487
48,322,169
$204,433,956
I These amounts represent contractual commitments for the City’s participation in the Valley Communications Emergency Radio
System debt, including certificates of participation.
General Obligation Debt Ratios
2006 Population Estimate .....................................................................................................................58,360
2006 Assessed Valuation ........................................................................................................$7,334,476,542
Assessed Valuation Per Capita ..........................................................................................................$125,676
Direct Debt Per Capita .............................................................................................................................$858
Direct and Estimated Overlapping Debt Per Capita ............................................~ .................................$3,503
Direct Debt to Assessed Valuation .......................................................................................................0.66%
Direct and Estimated Overlapping Debt to Assessed Valuation ...........................................................2.79%
16
Future Financing
The City anticipates that it may from time to time-issue additional limited and unlimited tax general obligation
bonds to finance capital improvements. However, the City, as of the date of this Official Statement, does not
anticipate the need to incur additional general obligation debt within the next 12 months.
Debt Repayment Record
The City has never defaulted on a payment of principal or interest on any of its general obligation bonds.
Furthermore, the City has never issued refunding bonds for the purpose of avoiding an impending default on
its general obligation bonds.
Debt Limitation Calculation
in Washington there is a statutory limit on the amount of bonded, or other, indebtedness a city may incur.
(See "The Bonds - Statutory Debt Limitations" herein.) The following chart sets forth the remaining general
obligation debt capacities of the City as of January 1,2006, adjusted to reflect the issuance of the Bonds. The
2006 assessed valuation of the City is $7,334,476,542.
L GeneralPurposes:
A. Non-Voted Debt Capacity (1.50% of 2006 Valuation) ...................................$110,017,148
Less: Non-Voted General Obligation Debt Outstanding (including the Bonds). 44,892,952
Less: Loans ......................................................................................................1,989,2171
Remaining Capacity for Non-Voted General Purposes ....................................................$63,134,979
B. Total General Debt Capacity (2.50% of 2006 Valuation) ...............................$183,361,914
Less: Voted General Obligation Debt ..............................................................1,440,000
Less: Non-Voted General Obligation Debt Outstanding (including the Bonds). 44,892,952
Less: Other ......................................................................................................1,989,2171
Remaining Capacity for Total General Debt ....................................................................$135,039,745
12. Utility Purposes:
Voted Debt Capacity (2.50% of 2006 Valuation) ................................................$183,361,914
Less: Voter Approved Bonds Outstanding .................................................0
Remaining Capacity for Utility Purposes .........................................................................$183,361,914
12. Parks and Open Space Purposes:
Voted Debt Capacity (2.50% of 2006 Valuation) ................................................$183,361,914
Less: Voter Approved Bonds Outstanding .................................................0
Remaining Capacity for Parks and Open Space .............................................................$183,361,914
~ These amounts represent contractual commitments for the City’s participation in the Valley Communications Emergency Radio
System debt, including certificates of participation.
17
Schedule of Limited Tax General Obligation Bond Debt Service
In addition to the Bonds, the City has Limited Tax General Obligation Bonds outstanding in the total principal
amount of $26,831,734 ($188,715 of Limited Tax General Obligation Bonds, 1996; $3,973,019 of Limited
Tax General Obligation Bonds, 1997; $19,195,000 of Limited Tax General Obligation and Refunding Bonds,
2001; and $3,475,000 in Limited Tax General Obligation Bonds, 2002), an installment contract outstanding in
the principal amount of $81,218 and $1,989,217, not shown below, that represents the City’s contractual
commitments for the City’s participation in the Valley Communications Emergency Radio System debt,
including certificates of participation. Set forth in the following table is the aggregate debt service schedule
for the outstanding limited tax general obligation bonds and the Bonds as of the date of issuance of the Bonds.
Interest figures have been rounded in some cases.
The City also has Unlimited Tax General Obligation Bonds, outstanding in the principal amount of
$1,440,000 with a final maturity in 2009, not shown below.
Year
2006
2007 ---
2008 $520,000
2009 540,000
2010 565,000
2011 585,000
2012 610,000
2013 640,000
2014 670,000
2015 700,000
2016 750,000
2017 775,000
2018 1,615,000 370,671 815,000
2019 1,705,000 287,033 855,000
2020 1,800,000 198,500 900,000
2021 1,885,000 108,500 945,000
2022 285,000 14,250 1,000,000
2023 1,040,000
2024 1,095,000
2025 1,155,000
2026 1,210,000
2027 1,275,000
2028 1,335,000
Total $81,218 $5,581 $25,248,447 $13,958,777 $17,980,000
Outstanding
Installment Contact LTGO Bonds The Bonds
Total Debt Service
Principal Interest Princ~al Interest Princ~al Interest
$31,405 $3,315 $888,946 $1,625,119 ---$294,420
32,838 1,882 918,926 1,656,639 883,260
16,975 384 895,575 1,692,565 883,260
985,000 1,599,528 861,160
1,520,000 1,070,463 838,210
1,575,000 1,009,833 816,175
1,655,000 946,833 791,312
1,720,000 862,245 760,813
1,810,000 773,940 732,012
1,900,000 680,715 696,838
1,995,000 582,606 660,087
2,095,000 479,337 627,838
589,087
548.338
505587
460,588
413,337
360838
306,238
248,750
~191,000
130,500
66,750
$12,666,398
$2,843,205
3,493,545
4,008,759
3,985,688
3,993,673
3,986,008
4,003,145
3,983,058
3,985,952
3,977,553
3,987,693
3,977,175
3,389,758
3,395,371
3,404,087
3,399,088
1,712,587
1,400,838
1,401,238
1,403,750
1,401,000
1,405,500
1,401,750
$69,940,421
18
Auditing of City Finances
Cities and counties of the State must comply with the Budgeting, Accounting, and Reporting System
("BARS") prescribed by the Office of the State Auditor as authorized under RCW 43.09.230 and 43.09.230.
State laws also provide for annual independent audits by the Office of the State Auditor and require timely
submission of annual financial reports to the State Auditor for review. The financial system of the City
incorporates a system of financial and administrative controls that ensure the safeguarding of assets and the
reliability of financial reports and consequently are designed to provide reasonable assurance that transactions
are executed in accordance with management authorization, recorded in conformity with generally accepted
accounting principles ("GAAP") applicable to governmental entities, that there exists accountability of and
control over assets and obligations, and that sufficient reporting and review exists to provide adequate
information for analysis and comparability of data. Internal control is an area of audit by the State Auditor, as
well, and City management receives and takes action upon recommendations made by the State Auditor.
The City’s financial statements are subject to annual audit by the State Auditor. The last audit covered the
year ended December 31, 2005 and the report thereon contained an unqualified opinion regarding the City’s
2005 financial statements. Copies of the State Auditor’s Report maybe obtained by contacting the Office of
State Auditor in Olympia, Washington, the City or on-line at www.sao.wa.gov.
The Budgetary Process
The City budgets it funds in accordance with chapter 3 5A.3 3 RCW. Annual appropriated budgets are adopted
for the general, special revenue, debt service, and capital projects funds on the cash basis of accounting and
include fund balances. The City provides a reconciliation of the differences between the budgetary basis and
GAAP each year in its Comprehensive Annual Financial Report.
The City Council annually adopts a budget by ordinance establishing appropriations for City funds, and during
the year may authorize supplemental appropriations. Administrative and legal budgetary control is established
at the fund level, i.e., expenditures for a fund may not exceed the total appropriation amount. The Mayor or
Chief Administrative Officer may authorize transfers of appropriations within a fund however interfund
transfers must be approved by ordinance of the Council.
[The remainder of this page intentionally left blank.]
19
Historical and Budgeted General Fund Operating Results
Historieal General Fund Operating Results. The financial information that follows was extracted from the
City’s annual audited financial statements for the fiscal years ended December 31, 2001 through 2005.
Additional information which may interpret, clarify or modify the data presented below may be contained in
the complete financial audits, including the accompanying footnotes, which may be obtained by contacting the
City Auditor upon payment of charges for copying, mailing and handling. See also "City Financial
Information - Auditing of City Finances" herein.
Beginning Fund Balance
Revenues:
Taxes
Licenses and Permits
Intergovernmental
Charges for Services
Fines and Forfeitures
Interfund Revenues
Contributions
Interest
Miscellaneous
Total Revenues
Total Sources
Expenditures:
General Government
Security of Persons/Propert)
Physical Environment
Economic Environment
Mental and Physical Health
Culture and Recreation
Capital Outlay
Total Expenditures
Sale of Assets
Net Transfers
Adjustments
Ending Fund Balance
Fiscal Ye~ End~g December31
Audited Audited Audited Audited Audited
2001 2002 2003 2004 2005
$8,337,005 $6,746,368 $4,003,136 $6,841,364 $8,754,507
$31,482,675 $32,014,248 $35,320,008 $35,452,979 $38,346,842
2,110,600 2,371,596 2,562,807 2,662,749 3,046,091
1,966,122 1,941,063 2,127,364 2,347,221 2,994,718
4,196,915 4,121,870 2,740,465 1,998,396 2,163,442
944,671 948,861 1,014,382 964,804 683,045
0 0 2,536,155 2,613,038 2,718,806
101,783 40,133 61,356 104,804 66,228
1,208,435 555,023 469,994 601,898 367,469
158,530 70,013 38,663 109,464 90,604
42,169,731 42,062,807 46,871,194 46,855,353 50,477,245
50,506,736 48,809,175 50,874,330 53,696,717 59,231,752
$8,977,920 $10,172,983 $10,791,833 $10,969,047 $11,541,778
23,596,319 24,926,075 26,029,354 27,462,613 29,031,626
1,878,916 1,897,165 2,015,562 2,201,777 2,190,228
3,487,376 3,605,013 3,600,630 3,951,377 4,266,112
6756 11,445 10,368 11,723 12,700
177,039 903 0 34,686 43,453
141,210 24,221 29,348 0 103,115
38,265,536 40,637,805 42,477,095 44,706,990 47,189,012
$55,168 $104,825 $19,129 $2,325 $37,047
(5,550,000)(4,273,059)(1,575,000)(3,266,800)(2,881,916)
0 0 0 2,986,493 0
$6,746,368 $4,003,136 $6,841,364 "$8,711,745 $9,197,871
Source: City Audited Financial Statements
20
General Fund Budget The following comparative financial data is extracted from the City’s 2005 and
2006 General Fund Budgets.
Beginning Fund Balance
2005 2006
Budget Budget
$6,682,351 $6,922,731
Revenues:
Property Taxes
Sales Taxes
Utility Taxes
Gambling Excise Tax
Other Taxes
Licenses and Permits
Intergovernmental
Charges for Services
Fines and Forfeitures
Investment Income
Miscellaneous & Other
Interfund Revenues
Total Revenues
$9,869,700 $9,647,388
18,427,600 19,138,252
5,264,200 5,559,436
2,005,000 2,305,000
1,418,000 1,551,582
1,962,800 3,395,598
2,272,905 2,260,400
1,543,400 2,144,200
969,500 701,400
657,800 649,500
192,725 189,100
2,507,600 2,554,400
$47,091,230 $50,096,256
Total Sources $53,773,581 $57,018,987
Expenditures:
Regular Salaries
Part Time Salaries
Overtime
Personnel Benefits
Supplies
Professional Services
Postage/Telephone
Travel/Training
Equipment and Other Rentals
Insurance
Public Utility Services
Repairs and Maintenance
Other Services & Charges
Intergovernmental Services/Payments
Capital Outlay
Interfund Payment
Transfer Out
Total Expenditures
Increase to Reserves
Ending Fund Balance
$25,530,600 $26,474,500
188,200 131,020
1,819,935 1,790,700
7,983,700 9,183,650
991,395 856,325
3,149,900 3,041,912
406,100 74,400
212,400 222,875
1,497,200 1,497,200
1,564,200 1,564,200
14,000 14,000
368,500 230,250
734,900 781,657
1,714,900 1,897,360
49,200 54,900
0 1,974,307
2,881,916 272,000
$50,107,046 $50,061,256
0 35,000
$3,666,535 $6,957,731
Source: City’s Budget Report
21
General Information
THE CITY
The City surrounds the southern end of Lake Washington, southeast of Seattle on Interstate 405. The City is
located approximately 20 miles southeast of the City of Seattle and approximately 60 miles northeast of the
City of Olympia, the State’s capital. As of the 2005 population estimates, the City ranked fifth in size among
cities in the County. The City had a population of 58,360 as estimated in 2006 by the State Office of Financial
Management. The County had an estimated population of 1,808,300 as reported in 2005 by the State Office of
Financial Management, an increase of approximately 4.1% since the 2000 Census.
Major contributors to the area’s economy are manufacturing, technology-based business, the Port of Seattle,
services industry, tourism, fishing and agriculture. (See "Appendix A - Economic and Demographic
Information" herein for a description of the area’s economy.)
Form of Local Government
The City, which was incorporated in 1901, has a strong Mayor form of government. The Mayor is
independently elected to a four-year term. The Mayor’s job is to manage and implement the policies
established by the seven-member Council. Each Council member serves a four-year term and is elected on a
staggered two-year cycle.
The names of the current members of the City Council as well as the dates on which of their respective terms
of office expire are as listed below.
Expiration of
Name Title Term
Kathy Keolker Mayor 12/31/07
Randall Corman President 12/31/09
Terri Briere Council Member 12/31/09
Dan Clawson Council Member 12/31/09
Denis Law Council Member 12/31/07
Toni Nelson Council Member 12/31/07
Marcie Palmer Council Member 12/31/07
Don Persson Council Member 12/31/07
Principal City Officials
Kathy Keolker, Mayor. Ms. Keolker was appointed to the Renton City Council in 1984 by her fellow City
Council members and served five terms as a Councilmember. On January 1, 2004, she began her first term
serving as Mayor. Ms. Keolker has been an active member of the Renton community since 1976, which
includes serving as a past Chair of the United Way South Community Council, serving as a currently member
of the United Way of King County Board and being a active member in petition processes. In addition to her
duties as Mayor, Ms. Keolker works with the Center of Women and Democracy at the University of
Washington as a trainer and "leader in residence" for NEW Leadership Puget Sound.
22
Jay Covington, Chief Administrative. Officer. Mr. Covington joined City staffin 1990. Prior to joining the
City, Mr. Covington served eight years at the City of Vancouver, Washington, in the roles of budget analyst,
management analyst and Assistant to the City Manager. During his tenure with the City of Vancouver, Mr.
Covington developed a municipal biennial budget as well as improved financial forecasting techniques.
Michael E. Bailey, Finance &Information Services Administrator. Mr. Bailey joined City staffas Finance &
Information Services Administrator on September 1, 2005. Mr. Bailey is a certified public accountant and
prior to being appointed to his current position with the City, Mr. Bailey was employed as the Finance
Director for the City of Lynwood since 1999, and previously served as the Finance Director for the cities of
Everett and Wenatchee and the Metropolitan Park District of Tacoma. Mr. Bailey earned a Bachelor’s degree
in Business Administration and Accounting and a Master’s degree in Public Administration, both from the
University of Puget Sound. Mr. Bailey is a past President of the Washington Finance Officers Association, a
past representative for the State of Washington to the National Finance Officers Association and was named
"Business Person of the Year" by the National Future Business Leaders of America in 1998.
City Employment and Primary Services
The City had approximately 616 full-time employees as of January 1, 2006 and 709 full-time equivalent
employees when including seasonal and part-time employees. The City provides services in accordance with
its charter, and operates its own police, fire, park and recreation, utility system, municipal airport and library
system.
Employee Relations
The City has five bargaining units. The commissioned police officers have a guild. The guild also represents,
in a separate bargaining unit, the non-commissioned support staff of the Police Department. There are two
bargaining units in the Fire Department. The firefighters through the rank of captain are represented as a
group. There are six battalion chiefs who are represented by a separate bargaining unit. The greatest number
of employees is represented by AFSCME (American Federation of State and City Municipal Employees).
State law requires municipalities to bargain collectively with formally recognized collective bargaining units.
The management group tends to receive benefits very similar to the AFSCME contract. There are no
significant outstanding personnel issues at this time. The City bargains with each of the units every three
years. The City has contracts with all the bargaining units through 2008.
Pension Plans
Public Employees ’Retirement System ("PERS"). Substantially all of the City’s full-time and qualifying part-
time employees, other than those covered under union plans, participate in PERS. This is a statewide local
government retirement system administered by the Washington State Department of Retirement Systems,
under cost-sharing, multiple-employer defined benefit public employee retirement plans. The PERS system
includes three plans.
23
Participants who joined the system by September 30, 1977, are PERS Plan I members. Those joining
thereafter are enrolled in PERS Plan II. In March 2000, Governor Gary Locke signed into law a new
retirement plan for members of the PERS Plan II. The new plan, entitled PERS Plan III, provides members
with a defined benefit plan similar to PERS Plan II and the opportunity to invest their retirement contributions
in a defined contribution plan. PERS Plan II members that joined on or after October 1, 1977 ; and either by
February 28, 2002 for state and higher education employee or August 31, 2002 for local government
employees; are PERS Plan II members unless they exercise an option to transfer their membership to PERS
Plan III. PERS Plan II participants joining the system on or after March 1, 2002, for state and higher
education employees, or September 1, 2002 for local government employees have the irrevocable option of
choosing membership in either PERS Plan II or PERS Plan III. The option must be exercised within 90 days
of employment and an employee is reported to PERS Plan II until a choice is made and ifa choice is not made
within 90 days the employee defaults to PERS Plan III. PERS defined benefit retirement benefits are financed
from a combination of investment earnings and employer and employee contributions. PERS retirement
benefit provisions are established in state statute and may be amended only by the State Legislature.
PER Plan I benefits are vested after an employee completes five years of eligible service. PERS Plan I
members are eligible for retirement at any age after 30 years of service, at age 60 with five years of service, or
at age 55 with 25 years of service. The annual pension is two percent of the average final compensation per
year of service, capped at 60 percent. The average final compensation is based on the greatest compensation
earned during any 24 eligible consecutive compensation months. If qualified, after reaching age 66, a cost of
living allowance is granted based on years of service credit and is capped at 3% annually.
PER Plan II benefits are vested after an employee completes five years of eligible service. PERS Plan II
members may retire at age 65 with five years of service or at 55 with 20 years of service. The annual pension
is two percent of the average final compensation per year of service. The average final compensation is based
on the greatest compensation during any eligible consecutive 60-month period. PERS Plan II retirements prior
to 65 receive reduced benefits. If retirement is at age 55 or older wit 30 years of service, a 3% per year
reduction applies; otherwise an actuarial reduction will apply. There is not cap on years of service credit and a
cost-of living allowance is granted (indexed to the Seattle Consumer Price Index), capped at 3% annually.
PERS Plan llI has a dual benefit structure. Employer contributions finance a defined benefit component, and
member contributions finance a defined contribution component. The defined benefit portion provides a
benefit calculation at 1% of the average final compensation per year of service. The average final
compensation is based on the greatest compensation during any eligible consecutive 60-month period. PERS
Plan III members become eligible for retirement if they have at least ten years of service; or five years
including twelve months that were earned after age 54; or five service credit years earned in PERS Plan II
prior to June 1, 2003. PERS Plan llI retirements prior to age 65 receive reduced benefits. If retirement is at
age 55 or older with at least 30 years of service; a 3% per year reduction applies; otherwise an actuarial
reduction will apply. There is no cap on year of service credit and a cost-of living allowance is granted
(indexed to the Seattle Consumer Price Index), capped at 3% annually. The defined contribution portion can
be distributed in accordance with an option selected by the member, either as a lump sum or pursuant to other
options authorized by the Employee Retirement Benefits Board.
Each biennium, the State Pension Funding Council adopts PERS Plan I employer contribution rates, PERS
Plan II employer and employee contribution rates and PERS Plan III employer contribution rates. Employee
contribution rates for PERS Plan I are established by statute at six percent and do not vary from year to year.
The employer and employee contribution rates for PERS Plan II and the employer contribution rates for PERS
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Plan III are developed by the Office of the State Actuary, to continue to fully fund PERS Plan II and the
defined benefit portion of PERS Plan III. All employers are required to contribute at the level established by
the Legislature. PERS Plan II defined contribution is a non-contribution plan for employers. Employees who
participate in the defined contribution portion of the PERS Plan III do not contribute to the benefit portion of
PERS Plan III. The Employee Retirement Benefits Board sets PERS Plan II employee contribution rates. Six
rate options are available ranging from 5-15%; two of the options are graduated rates dependent upon the
employee’s age. The methods used to determine the contribution requirements are established under state
statute in accordance with 41.40 and 41.46 RCW.
All employers are required to contribute at the level established by State law. The methods used to determine
the contribution requirements are established under State statute in accordance with Chapters 41.40 and 41.26
RCW.
The City’s required contribution for PERS Plan I, II and III for the year ended December 31, 2005, was
$33,340, $ 367,240 and $ 51,521, respectively.
Law Enforcement Officers’ and Fire Fighters’ Retirement System ("LEOFF"). LEOFF is a cost-sharing
multiple-employer defined benefit pension plan. Membership in the plan includes all full-time, fully
compensated local law enforcement officers, and fire fighters. The LEOFF system includes two plans.
Participants who joined the system by September 30, 1977, are LEOFF Plan I members. Those joining
thereafter are enrolled in LEOFF Plan II. Effective July 1, 2003, the LEOFF Plan II Retirement Board was
established to provide governance of LEOFF Plan II. The Board’s duties include adopting contribution rates
and recommending policy changes to the Legislature for the LEOFF Plan II. Effective January 1, 2003,
firefighter emergency medical technicians (EMT’s) may transfer PERS Plan I or II service credit to LEOFF
Plan II if(while employed for the City), the EMT’s job was relocated to a fire department from another city.
Retirement benefits are financed from employee and employer contributions, investment earnings, and State
contributions. LEOFF retirement benefit provisions are established in state statute and may be amended only
by the State Legislature. Retirement benefits in both LEOFF Plan I and LEOFF Plan II are vested after
completion of five years of eligible service.
LEOFF Plan I retirement benefits are vested after an employee competes five years of eligible service.
LEOFF Plan I members are eligible for retirement with five years of service at age 50. The service retirement
benefit is dependent upon the final average salary and service credit years at retirement.
Term of Percent of Final
Service Average
5-9 years 1.0%
10-19 years 1.5
20 or more years 2.0
The final average salary is the basic monthly salary received at the time of retirement, provided a member has
held the same position or rank for 12 months preceding the date of retirement. Otherwise, it is the average of
the highest consecutive 24 months’ salary within the last 10 years of service. If membership was established
in LEOFF after February 18, 1974, the service retirement benefit is capped at 60% of final average salary. A
cost-of-living allowance is granted (indexed to the Seattle Consumer Price Index).
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LEOFF Plan II retirement benefits are vested after an employee competes five years of eligible service.
LEOFF Plan II members are eligible to retire at the age of 50 with 20 years of service or at 53 with five years
of service, with an allowance of 2% of the final average salary per year of service. The final average salary is
determined as the 60 highest paid consecutive service months. LEOFF Plan II retirements prior to age 53 are
reduced 3% for each year the benefit commences prior to age 53. There is no cap on years of service credit
and a cost-0f-living allowance is granted (indexed onto the Seattle Consumer Price Index), capped at 3%
armually.
Commencing July 1, 2000, LEOFF Plan I employers and employees will contribute 0% as long as the plan
remains fully funded. Employer and employee rates for LEOFF Plan II are set by the director of the
Department of Retirement Systems, based on recommendations by the Office of the State Actuary, to continue
to fully fund the plan. LEOFF Plan I employer and employee contribution rates are established by statute, and
the State is responsible for the balance of the funding at rates set by the Pension Funding Council to fully
amortize the total costs of the plan. LEOFF Plan II employers and employees are required to contribute at the
level required by State law. The methods used to determine the contribution rates are established under State
statute in accordance with Chapters 41.26 and 41.45 RCW.
The City’s required contribution for LEOFF Plan I and II for the year ended December 31,2005, was $2,554
and $549,001, respectively..
Historical trend information regarding all of these plans is presented in Washington State’s Department of
Retirement Systems’ annual financial report. A copy of this report may be obtained at:
Department of Retirement Systems
Point Plaza West
1025 East Union Street
P.O. Box 48380
Olympia, WA 98504-8380
Internet Address: www.drs.wa, gov
GASB 45. The Governmental Accounting Standards Board ("GASB") has issued a new standard concerning
Accounting and Financial Reporting by Employers for Post Employment Benefits Other than Pensions
("GASB 45"). In addition to pensions, many state and local governmental employers provide other post
employment benefits ("OPEB") as a part of total compensation to attract and retain the services of qualified
employees. OPEB includes post employment healthcare, as well as other forms of post employment benefits
when provided separately from a pension plan. The new standard provides for the measurement, recognition
and display of OPEB expenses/expenditures, related liabilities (assets), note disclosures, and if applicable,
required supplementary information in the financial reports. This pronouncement is effective for the City for
the fiscal year ending on December 31, 2007.
The City provides medical benefits to retired firefighters and police officers who were hired prior to 1978 as
required by 41.26.15 RCW. Entry into this benefit system is closed.
An actuarial study was completed by Nicolay Consulting on January 4, 2005. At that time there were 106
participants in the system. As of June 30, 2006, there are 107 participants. The study found that the City’s
Annual Required Contribution to fully fund the anticipated costs of $25,864,528 would be $1,495,748
annually until 2035 (30 years). In the 2006 budget, the City allocated $1,700,000 to this obligation. The City
anticipates commissioning another actuarial study by year-end. The City intends to comply with GASB 45
reporting requirement in its 2006 financial report.
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Risk Management
The City insures its risk exposure up to specified levels of risk as determined by the City, and purchases
excess insurance commercially to cover medium to large losses. The City’s risk management program is
administered by the Human Resources/Risk Management Administrator, with claims processed by
independent claims administrators. The City is a member of the Washington Cities Insurance Authority
comprised of approximately 108 public agencies located in the State of Washington. Shown below are the
City’s insurance limits through the Washington Cities Insurance Authority.
Risk Retention Stop Gap
Coverage Type Per Occurrence Loss Limit
Property $25,000 $500,000,0001
Liability 250,000 14,000,0001
Auto Liability 250,000 14,000,0001
Boiler & Machinery 5,000 50,000,000
Public Officials 250,000 10,000,000
Crime 10,000 1,000,000
Airport Liability 0 50,000,000
Underground Storage Tank 10,000 1,000,000
Worker’s Compensation 350,000 1,000,000
Employee Health 210,000 N/A
Stop Gap Loss Limit is per occurrence with the property coverage subject to limits.
APPROVAL OF BOND COUNSEL
Legal matters incident to the authorization, issuance and sale of the Bonds by the City are subject to the
unqualified approving legal opinion of Gottlieb, Fisher & Andrews, PLLC, Seattle, Washington, Bond
Counsel. Fees payable to Gottlieb, Fisher & Andrews, Seattle, PLLC, as Bond Counsel, are contingent upon
the issuance of Bonds. Bond Counsel has reviewed this document only to confirm that the portions of it
describing the Bonds and the authority of the City to issue them conform to the Bonds, the applicable laws
under which they were issued and the language regarding federal income tax exemption. A form of the legal
opinion is included herein in Appendix C.
TAX EXEMPTION
General
In the opinion of Gottlieb, Fisher & Andrews, PLLC, Bond Counsel, as of the date of issue of the Bonds (the
"Date of Issue"), and assuming the City complies with applicable requirements of the Code which must be
satisfied subsequent to the issuance thereof, interest on the Bonds (including any original issue discount
properly allocable to the owner thereof) is excludable from gross income for purposes of federal income
taxation under existing federal law, and is not an item of tax preference for purposes of determining the
altemative minimum tax on individuals and corporations under existing federal law. However, under existing
federal law, interest on the Bonds (including any original issue discount properly allocable to the owner
thereof) is taken into account in determining adjusted current earnings for the purpose of computing the
alternative minimum tax imposed on certain corporations.
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Continuing Requirements
The Code contains certain requirements which must be satisfied subsequent to the issuance of the Bonds in
order to maintain the tax treatment described above, including requirements relating to the application of the
proceeds of the Bonds, use of facilities which are financed with such proceeds, limitations on income derived
from the investment of gross proceeds of the Bonds (as defined in Section 148 of the Code), and rebate to the
United States Treasury of certain of such investment income. The City has covenanted to comply with these
requirements to the extent applicable; and the opinions of Bond Counsel described in the preceding paragraph
assume such compliance. However, Bond Counsel has not undertaken and shall not undertake to monitor
compliance by the City with such requirements; and if the City should fail to comply with such requirements,
interest on the Bonds could become includable in gross income for federal income tax purposes, and could be
treated as an item of tax preference for purposes of the alternative minimum tax on individuals and
corporations, in each case, retroactive to the Date of Issue.
OTHER FEDERAL TAX MATTERS
Ownership of the Bonds may result in other federal tax consequences to certain taxpayers, including, without
limitation, certain S corporations, foreign corporations with branches in the United States, property and
casualty insurance companies, individual recipients of Social Security or Railroad Retirement benefits, and
taxpayers, including banks, thrift institutions and other financial institutions subject to Section 265 of the
Code, who may be deemed to have incurred or continued indebtedness to purchase or to carry the Bonds, and
taxpayers who have an initial basis in the Bonds greater or less than the principal amount thereof. Bond
Counsel is not rendering any opinion as to any federal tax matters other than as described under the caption
"Tax Exemption-General." Prospective purchasers of the Bonds should consult their independent tax
advisors.
Tax Covenants
The City has covenanted in the Bond Ordinance that: (1) it will not take or permit to be taken on its behalf any
action that would adversely affect the exclusion of the interest on the Bonds from the gross income for
purposes of federal income taxation, and will take or require to be taken such acts as may be permitted by
Washington law and as may from time to time be required under applicable law to continue the exclusion of
the interest on the Bonds from the gross income for purposes of federal income taxation.; and (2) it will
calculate or cause to be calculated, and rebate to the United States, all earnings from the investment of Bond
proceeds that are in excess of the amount that would have been earned had the yield on such investments been
equal to the yield on the Bonds, plus income derived from such excess earnings, to the extent and in the
manner required by Section 148 of the Code.
Original Issue Discount
The Bonds maturing on December 1, in the year 2010 are "Discount Bonds." The difference between the
principal amount of the Discount Bonds and the initial offering price to the public (excluding bond houses,
brokers, or similar persons or organizations acting in the capacity of underwriter or wholesaler) at which price
a substantial amount of such Discount Bonds of the same maturity was sold constitutes original issue discount,
which is excluded from gross income for federal income tax purposes to the same extent as interest on the
28
Discount Bonds. Further, this original issue discount accrues on the basis of a constant yield to maturity over
the term of each Discount Bond and the basis of each Discount Bond acquired at such initial offering price by
an initial purchaser thereof will be increased by the amount of such accrued original issue discount.
Original Issue Premium
The Bonds maturing on December 1 in the years 2008, 2009, 2011 through 2017, inclusive, 2019 through
2024, inclusive, and 2028 are "Premium Bonds." An amount equal to the excess of the purchase price of a
Premium Bond over its stated redemption price at maturity constitutes premium on such Premium Bonds. A
purchaser of a Premium Bond must amortize any premium over such Premium Bond’s term using constant
yield principles, based on the Premium Bond and the amount of tax-exempt interest received will be reduced
by the amount of the amortizable premium properly allocable to such purchaser. This will result in an
increase in the gain (or decrease in the loss) to be recognized for federal income tax purposes on sale or
disposition of such Bond prior to its maturity. Even though the purchaser’s basis is reduced, no federal
income tax deduction is allowed. Purchasers of any Premium Bonds, whether at the time of initial issuance of
subsequent thereto, should consult their tax advisors with respect to the determination and treatment of
premium for federal income tax purposes, and with respect to state and local tax consequences of owning such
Premium Bonds.
NO LITIGATION CONCERNING THE BONDS
There is no controversy or litigation of any nature now pending or, to the knowledge of the City, threatened,
restraining or enjoining the issuance, sale, execution or delivery of the Bonds, or in any way contesting or
affecting the validity of the Bonds, any proceedings of the City taken with respect to the issuance or sale
thereof, or affecting the ability of the City to pay the principal of and interest on the Bonds.
UNDERWRITING
D. A. Davidson & Co. (the "Underwriter") has agreed, subject to the terms of a Bond Purchase Agreement, to
purchase the Bonds from the City at a price of 103.013649% of the par value of the Bonds, plus accrued
interest from August 1, 2006. The Bonds are being offered for sale to the public at the prices shown on the
inside cover of this Official Statement. Concessions from the initial offering price may be allowed to selected
dealers and special purchasers. The initial offering prices are subject to change after the date hereof.
MUNICIPAL BOND INSURANCE
The MBIA Insurance Corporation Insurance Policy
The following information has been furnished by MBIA Insurance Corporation ("MBIA") for use in this
Official Statement. Reference is made to Appendix D for a specimen of MBIA’s policy (the "Policy").
MBIA does not accept any responsibility for the accuracy or completeness of this Official Statement or any
information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the
29
information regarding the Policy and MBIA set forth under the heading "Municipal Bond Insurance".
Additionally, MBIA makes no representation regarding the Bonds or the advisability of investing in the
Bonds.
The MBIA Policy unconditionally and irrevocably guarantees the full and complete payment required to be
made by or on behalf of the City to the Registrar or its successor of an amount equal to (i) the principal of
(either at the stated maturity or by an advancement of maturity pursuant to a mandatory sinking fund payment)
and interest on, the Bonds as such payments shall become due but shall not be so paid (except that in the event
of any acceleration of the due date of such principal by reason of mandatory or optional redemption or
acceleration resulting from default or otherwise, other than any advancement of maturity pursuant to a
mandatory sinking fund payment, the payments guaranteed by the MBIA Policy shall be made in such
amounts and at such times as such payments of principal would have been due had there not been any such
acceleration, unless MBIA elects in its sole discretion, to pay in whole or in part any principal due by reason
of such acceleration); and (ii) the reimbursement of any such payment which is subsequently recovered from
any Owner of the Bonds pursuant to a final judgment by a court of competent jurisdiction that such payment
constitutes an avoidable preference to such Owner within the meaning of any applicable bankruptcy law (a
"Preference").
MBIA’s Policy does not insure against loss of any prepayment premium which may at any time be payable
with respect to any Bonds. MBIA’s Policy does not, under any circumstance, insure against loss relating to:
(i) optional or mandatory redemptions (other than mandatory sinking fund redemptions); (ii) any payments to
be made on an accelerated basis; (iii) payments of the purchase price of Bonds upon tender by an owner
thereof; or (iv) any Preference relating to (i) through (iii) above. MBIA’s Policy also does not insure against
nonpayment of principal of or interest on the Bonds resulting from the insolvency, negligence or any other act
or omission of the Registrar or any other paying agent for the Bonds.
Upon receipt of telephonic or telegraphic notice, such notice subsequently confirmed in writing by registered
or certified mail, or upon receipt of written notice by registered or certified mail, by MBIA from the Registrar
or any owner of a Bond the payment of an insured amount for which is then due, that such required payment
has not been made, MBIA on the due date of such payment or within one business day after receipt of notice
of such nonpayment, whichever is later, will make a deposit of funds, in an account with U.S. Bank Trust
National Association, in New York, New York, or its successor, sufficient for the payment of any such insured
amounts which are then due. Upon presentment and surrender of such Bonds or presentment of such other
proof of ownership of the Bonds, together with any appropriate instruments of assignment to evidence the
assignment of the insured amounts due on the Bonds as are paid by MBIA, and appropriate instruments to
effect the appointment of MBIA as agent for such owners of the Bonds in any legal proceeding related to
payment of insured amounts on the Bonds, such instruments being in a form satisfactory to U.S. Bank Trust
National Association, U.S. Bank Trust National Association shall disburse to such owners or the Registrar
payment of the insured amounts due on such Bonds, less any amount held by the Registrar for the payment of
such insured amounts and legally available therefor.
MBIA Insurance Corporation
MBIA Insurance Corporation ("MBIA") is the principal operating subsidiary of MBIA Inc., a New York Stock
Exchange listed company (the "Company"). The Company is not obligated to pay the debts of or claims against
MBLA. MBIA is domiciled in the State of New York and licensed to do business in and subject to regulation
30
under the laws of all 50 states, the District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth
of the Northern Mariana Islands, the Virgin Islands of the United States and the Territory of Guam. MBIA,
either directly or through subsidiaries, is licensed to do business in the Republic of France, the United Kingdom
and the Kingdom of Spain and is subject to regulation under the laws of those jurisdictions.
The principal executive offices of MBIA are located at 113 King Street, Armonk, New York 10504 and the
main telephone number at that address is (914) 273-4545.
Regulation
As a financial guaranty insurance company licensed to do business in the State of New York, MBIA is subject to
the New York Insurance Law which, among other things, prescribes minimum capital requirements and
contingency reserves against liabilities for MBIA, limits the classes and concentrations of investments that are
made by MBIA and requires the approval of policy rates and forms that are employed by MBIA. State law also
regulates the amount of both the aggregate and individual risks that may be insured by MBIA, the payment of
dividends by MBIA, changes in control with respect to MBIA and transactions among MBIA and its affiliates.
The Policy is not covered by the Property/Casualty Insurance Security Fund specified in Article 76 of the
New York Insurance Law.
Financial Strength Ratings of MBIA
Moody’s Investors Service, Inc. rates the financial strength ofMBIA "Aaa."
Standard & Poor’s, a division of The McGraw-Hill Companies, Inc. rates the financial strength of MBIA
Fitch Ratings rates the financial strength ofMBIA "AAA."
Each rating of MBIA should be evaluated independently. The ratings reflect the respective rating agency’s
current assessment of the creditworthiness of MBIA and its ability to pay claims on its policies of insurance.
Any further explanation as to the significance of the above ratings may be obtained only fi:om the applicable
rating agency.
The above ratings are not recommendations to buy, sell or hold the Bonds, and such ratings may be subject to
revision or withdrawal at any time by the rating agencies. Any downward revision or withdrawal of any of the
above ratings may have an adverse effect on the market price of the Bonds. MBIA does not guaranty the market
price of the Bonds nor does it guaranty that the ratings on the Bonds will not be revised or withdrawn.
MBIA Financial Information
As of December 31, 2005, MBIA had admitted assets of $11.0 billion (unaudited), total liabilities of $7.2
billion (unaudited), and total capital and surplus of $3.8 billion (unaudited) determined in accordance with
statutory accounting practices prescribed or permitted by insurance regulatory authorities. As of
31
March 31, 2006, MBIA had admitted assets of $11.2 billion (unaudited), total liabilities of $7.5 billion
(unaudited), and total capital and surplus of $3.8 billion (unaudited) determined in accordance with statutory
accounting practices prescribed or permitted by insurance regulatory authorities.
For further information concerning MBIA, see the consolidated financial statements of MBIA and its
subsidiaries as of December 31, 2005 and December 31, 2004 and for each of the three years in the period
ended December 31, 2005, prepared in accordance with generally accepted accounting principles, included in
the Annual Report on Form 10-K of the Company for the year ended December 31, 2005 and the consolidated
financial statements of MBIA and its subsidiaries as of March 31, 2006 and for the three month period ended
March 31, 2006 and March 31, 2005 included in the Quarterly Report on Form 10-Q of the Company for the
period ended March 31, 2006, which are hereby incorporated by reference into this Official Statement and
shall be deemed to be a part hereof.
Copies of the statutory financial statements filed by MBIA with the State of New York Insurance Department
are available over the Internet at the Company’s web site at http://www.mbia.com and at no cost, upon request
to MBIA at its principal executive offices.
Incorporation of Certain Documents by Reference
The following documents filed by the Company with the Securities and Exchange Commission (the "SEC")
are incorporated by reference into this Official Statement:
(1)
(2)
The Company’s Annual Report on Form 10-K for the year ended December 31, 2005; and
The Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006.
Any documents, including any financial statements of MBIA and its subsidiaries that are included therein or
attached as exhibits thereto, filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act after the date of the Company’s most recent Quarterly Report on Form 10-Q or Annual Report
on Form 10-K, and prior to the termination of the offering of the Bonds offered hereby shall be deemed to be
incorporated by reference in this Official Statement and to be a part hereof from the respective dates of filing
such documents. Any statement contained in a document incorporated or deemed to be incorporated by
reference herein, or contained in this Official Statement, shall be deemed to be modified or superseded for
purposes of this Official Statement to the extent that a statement contained herein or in any other subsequently
filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Official Statement.
The Company files annual, quarterly and special reports, information statements and other information with
the SEC under File No. 1-9583. Copies of the Company’s SEC filings (including (1) the Company’s Annual
Report on Form 10-K for the year ended December 31, 2005, and (2) the Company’s Quarterly Report on
Form 10-Q for the quarter ended March 31, 2006 are available (i) over the Internet at the SEC’s web site at
http://www.sec.gov; (ii) at the SEC’s public rdference room in Washington D.C.; (iii) over the Internet at the
Company’s web site at http://www.mbia.com; and (iv) at no cost, upon request to MBIA at its principal
executive offices.
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RATINGS
As noted on the cover page of this Official Statement, Standard & Poor’s Rating Group, New York, New York
and Fitch Ratings, New York, New York have given the Bonds the ratings of "AAA" and "AAA",
respectively, on the understanding that the Bonds will be insured by MBIA Insurance Corporation. Each
rating reflects only the view of the applicable rating organization and the current assessment of the
creditworthiness of the Insurer and its ability to pay claims on its policies of insurance.
Standard & Poor’s Rating Group and Fitch Ratings have assigned their municipal ratings of"AA-" and "AA-",
respectively, (the "underlying ratings") to the Bonds.
An interpretation of such rating maybe obtained only from the rating agency furnishing the same. Any further
explanation of the significance of the ratings may be obtained from Standard & Poor’s Ratings Group, at 55
Water Street, New York, New York 10041 (telephone 212-438-2000) and Fitch Ratings, One State Street
Plaza, New York, New York 10004 (telephone 212-908-0800).
The above ratings are not a recommendation to buy, sell or hold the Bonds. There is no assurance that such
ratings will continue for any given period of time or that it will not be revised downward or withdrawn
entirely by such rating agencies, if in judgment of such rating agency circumstances so warrant. Any such
downward revision or withdrawal of such rating may have an adverse effect on the market price of the Bonds.
NO CONFLICTS OF INTEREST
The City is not aware of the existence of any actual or potential conflict of interests, breach of duty or less
than ann’s-length transaction regarding the selection of the Underwriter, Bond Counsel, Financial Advisor and
other participants in the offering of the Bonds. Further, the City is not aware of any undisclosed payments to
obtain underwriting assignments and undisclosed agreements or arrangements, including fee splitting, between
the Underwriter and other participants in the offering of the Bonds. The payment of Bond Counsel’s fee and
the underwriting fees are contingent upon the issuance and delivery of the Bonds.
COMMITMENT TO PROVIDE CONTINUING DISCLOSURE
The Securities and Exchange Commission (the "SEC") has promulgated certain amendments to Rule 15c2-12
under the Securities Exchange Act of 1934 (the "Rule") that make it unlawful for an underwriter to participate
in the primary offering of municipal securities in a principal amount of $1,000,000 or more unless, before
submitting a bid or entering into a purchase contract for the bonds, it has reasonably determined that the issuer
or an obligated person has undertaken in writing for the benefit of the bondholders to provide certain
disclosure information to prescribed information repositories on a continuing basis. A complete description of
the information to be disclosed by the City, the manner of disclosure and remedies in the case of default is
found in Appendix B herein.
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ADDITIONAL INFORMATION AND MISCELLANEOUS
The descriptions herein of the Bond Ordinance and other documents are brief summaries of certain provisions
thereof. Such summaries do not purport to be complete, and reference is made to such documents and
contracts, copies of which are available, upon request and upon payment to the City of a charge for copying,
mailing and handling, from the City, 1055 South Grady Way, Renton, Washington 98055, telephone (425)
430-6858, attention Finance and Information Services Administrator.
The summaries and descriptions contained in this Official Statement and the Appendices hereto of the
provisions of the Bonds, the Bond Ordinance and all reference to other materials not purporting to be quoted
in full are only brief outlines of some of the provisions thereof and do not purport to summarize or describe all
of the provisions thereof. This Official Statement is not to be construed as a contract or agreement between
the City and the Underwriter or holders of any of the Bonds.
Any statements made in this Official Statement involving matters of opinion or estimates, whether or not so
expressly stated, are set forth as such and not as representations of fact. No representation is made that any of
such statements will be realized.
APPROVAL OF OFFICIAL STATEMENT
The execution and delivery of this Official Statement have been duly authorized by the City.
CITY OF RENTON, WASHINGTON
Michael E. Bailey \
Finance and Information Services Administrator
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APPENDIX A
Economic and Demographic Information
A-1
ECONOMIC AND DEMOGRAPHIC INFORMATION
Local Economic Overview
The City of Renton, Washington (the "City") is located in northwestern Washington in King County (the
"County"). The City is located approximately 20 miles southeast of the City of Seattle and approximately 60
miles northeast of the City of Olympia, the State’s Capital. As of the 2005 population estimates, the City
ranked fifth in size among cities in the County. The City had a population of 58,360 as estimated in 2006 by
the State Office of Financial Management. The County had an estimated population of 1,808,300 as
reported in 2005 by the State Office of Financial Management, an increase of approximately 4.1% since the
2000 Census.
The County encompasses 2,128 square miles, ranking 1 ltU in geographical size of Washington’s 39 counties,
but first in population. Seattle is the largest city in the Pacific Northwest and serves as the County seat. The
County and Snohomish and Island Counties to the north together comprise the Seattle Primary Metropolitan
Statistical Area (the "Seattle PMSA"), which is the fourth-largest metropolitan center on the Pacific Coast.
In addition to the City and the City of Seattle, principal cities of the Seattle PMSA include Auburn, Bellevue,
Bothell, Burien, Federal Way, Issaquah, Kent, Mercer Island, Redmond, Renton, Shoreline, and
Woodinville, all of which are in the County, and Everett, Edmonds, Mountlake Terrace and Lynnwood in
Snohomish County. These communities serve as residential, commercial, and industrial satellites of Seattle.
Seattle PMSA’s employment base is well diversified, with strengths in manufacturing, trade services and
government sectors. In 2004, manufacturing comprised about 7.9% of the area’s employment, with aircraft
production representing the largest component. In the non-manufacturing sectors, services was the largest
sector with over 41.0% of the total employment, wholesale and retail trade comprised almost 14.8% and
government and government enterprises 12.0%. The information industry contributed approximately 12.5%
of the total income by industry in the County, the most of all industries, followed by wholesale and retail
trade with 12.4%, manufacturing with 11.7% and government and government enterprises with 11.6%. The
U.S. Defense Department is one of the largest employers in the Puget Sound region. Major facilities include
Fort Lewis Army Base in Pierce County, the Puget Sound Naval Shipyard in Bremerton (Kitsap County),
Bangor Naval Submarine Base in Kitsap County, McChord Air Force Base in Pierce County and Naval
Station Everett.
The area’s universities and research institutions serve as catalysts in the expansion of high tech industries.
Other key factors that support continued growth include the existing industry base; a well-trained labor
force; relatively low cost power; and a progressive business climate with excellent transportation access to
worldwide markets.
Aircraft Manufacturing - The Boeing Company
Manufacturing in the area consists primarily of aircraft manufacturing by the Boeing Company ("Boeing").
Boeing is the second largest manufacturer in the world of commercial jets, behind Airbus, and the second
largest defense contractor, behind Lockheed Martin and is consistently one of the nation’s top three
exporters. In May 2001, Boeing moved its world headquarters and approximately 1,200 employees from
Seattle to Chicago to allow the corporate staffto focus on the direction of the company rather than day-to-
day operations. Boeing remains the area’s largest employer with several locations in the Puget Sound
region.
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In 2005, Boeing reported total revenues of $54.8 billion. While the primary activity of Boeing is the
manufacture of commercial aircraft, Boeing has played leading roles in the aerospace and military missile
programs of the United States human space flight, launch services and has undertaken a broad program of
diversification activities including Boeing Computer Services. Boeing has six major divisions to carry out
business activities, which include Air Traffic Management, Boeing Capital Corporation, Commercial
Airplanes, Connexion by Boeing, Military Aircraft and Missile Systems, and Space and Communications.
In recent years, Boeing has strived to streamline workforce operations and facilities. Since 1998, Boeing has
reduced its total workforce from 231,260 to 159,000 (as of January 2005), a decrease of approximately
72,260 (31.2%) employees. Since 1998, Boeing has reduced the total work force in the Central Puget Sound
Region from 98,440 to 55,400 (January 2005) a decrease of approximately 43,040 (43.7%) employees.
Boeing’s Washington employees are located largely in the Puget Sound Region, which currently has 15
Boeing sites/locations. As of the date of this Official Statement, it cannot be predicted if there will be further
Boeing layoffs that will impact Puget Sound Region operations.
Technology
The Seattle PMSA has experienced a substantial development of high technology, electronics and computer-
related enterprises particularly over the last decade. More than 1,500 computer development firms are
located in the Seattle PMSA. Microsoft, which is headquartered in Redmond, Washington, is the largest
computer software company in the world, with 2005 gross revenues worldwide of $39.8 billion, increasing
$3 billion or 8% since 2004. Other leading employers include Sundstrand Data Control, Inc. (electronics and
aerospace systems), ELDEC Corporation (electronic equipment), John Fluke Manufacturing Company
(electronic testing and calibrating instruments), Nintendo of North America (electronic games), Advanced
Technology Laboratories (medical ultra-sound equipment), Heath Techna Aerospace Co. (aerospace and
defense specialties and architectural equipment), Alliant Techsystems Inc. (sonar systems and signal
processing equipment), and Intermec Corporation (bar coding equipment).
Transportation
Seattle is bordered on the west by Elliott Bay, a natural harbor on Puget Sound, which is one of the nation’s
leading seaports. The Port of Seattle (the "Port"), a County-wide port district, promotes maritime trade,
particularly foreign trade and the employment of containerized cargo facilities, and has developed and is
continually improving a system of marine terminals, piers and associated facilities on Seattle’s waterfront.
The Port is one of the largest container ports in North America, ranking fifth in 2005 (behind Los Angeles,
Long Beach, New York/New Jersey, Oakland,) when measured by twenty-foot equivalent units ("TEU’s")
The Port of Seattle handled 2.08 million TEU’s, and the Port of Los Angeles handled 7.5 TEU’s.
Sea-Tac Airport ("Sea-Tac") is a major airport serving the State and is an aviation division of the Port.
According to the Airports Council International, Sea-Tat is the 17th business commercial airport based upon
total passengers in 2005. In 2005, Sea-Tac had a total of 29,289,026 air passengers, 91.5% of which were
domestic travel. As of December 2005, S ea-Tac had 22,000 airport employees and 14,000 off-site airport
related jobs. Sea-Tac is served by at least 24 airlines. In 2005, Sea-Tac generated $4.3 billion in business
revenue. For 2005, as reported by S ea-Tac, daily-non-stop service was available to 71 domestic cities and 16
international cities.
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King County International Airport ("Boeing Field"), a general aviation facility operated by the County, is
located in Seattle. With about 300,000 annual operations (takeoffs and landings), Boeing Field is the busiest
such facility in the region and ranks among the top 15 busiest in the nation. It serves as the primary
inclement weather alternate for SeaTac.
Seattle is the western terminus of two primary east-west freeway systems: Interstate Route 90 and State
Route 520, and is traversed by north-south Interstate Route 5 and State Route 99. The portion of 1-90 that
connects Seattle with eastside communities across Lake Washington was expanded to eight lanes at a cost of
$1.2 billion in the early 1990’s. In addition to the highway system, the Washington State Ferry System
provides convenient transportation between Seattle and points across Puget Sound to the west.
Sound Transit In 1996, voters in King, Pierce and Snohomish counties approved a $3.9 billion regional
transit measure. The transit system will be funded in large part with increases in local sales taxes and
vehicle license fees. Some federal funds will be contributed. The transit system is currently under
construction, expected to take ten years to build and will consist of electric light rail, commuter rail and
express buses.
In 2003, Sound Transit began construction on the initial 14-mile that stretched from Westlake Station to
TukwilaJInternational Boulevard. In late 2005, the Downtown Seattle Transit Tunnel was closed to allow for
modification so that it can be used by buses the Link light rail ("Link"). The tunnel may be closed for up to
two years. The Link trains are to begin testing in the fall of 2006 and will consist of 95-foot long cars that
can seat 74 passengers and up tot 200 passengers with standees. It is anticipated that Link service will begin
with 2-car trains and with the size of each platform, could be increased to 4-car trains, if necessary. It is
anticipated that Link will be ready for passengers in 2009.
In December of 2004, Sound Transit and the Port agreed to extend Link 1.7 miles to Sea-Tac Airport.
Construction has begun and is expected to be completed by December of 2009. Until this section is
completed, a shuttle bus will be available at Tukwila/International Boulevard for passengers going to Sea-
Tac. In addition, other extensions are also underway including: a North Link which would extend Link as
far north as Northgate and is currently in the planning and design phase, and a 3.15 mile University Link
connecting downtown Seattle to the University of Washington that may have construction started as soon as
2008. In 2003, a 1.6 mile Tacoma Link opened that would serves Tacoma Dome Station, downtown
Tacoma and University of Washington’s Tacoma campus.
The Sound Transit System also operates the Sounder Commuter Rail ("Sounder"), which is an 82-mile
system through three counties and contains 12 stations that utilize existing tracks between Everett, Seattle,
Tacoma and Lockwood. Sounder currently runs two transfer every weekday in the North Corridor and runs
four trains every weekday in the South Corridor. Sounder serves approximately 1 million passengers
annually. Sounder is anticipated to begin service from Tacoma to Lakewood in early 2008.
In addition, Sound Transit System operations ST Express Regional Bus. ST Ex~press is spending in excess of
$800 million on at least 36 transportation improvement projects to enhance speed and reliability. The bus
routes are designed to provide a seamless network of transportation to include the Link, Sounder and buses.
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Fishing, Agriculture and Forest Products
Seattle is the homeport for a major salmon and halibut fishing fleet. Approximately 700 fishing boats are
based at the Port’s Fishermen’s Terminal on Salmon Bay, part of the fresh-water system of lakes and canals
connected to Puget Sound by the Hiram M. Chittenden Locks, which are operated by the US Army Corps of
Engineers. Fish received in Seattle are largely for fresh market distribution and for freeze processing.
Seattle is also a warehousing and distribution center for fish processed elsewhere in the Northwest,
principally in Alaska.
Agriculture in the County consists primarily of dairy farming, truck gardening, horticulture and the raising of
livestock and poultry. The Seattle area is a major center in the Northwest for agricultural supply, distribution
and marketing as well as for food handling and processing and the manufacture of food packaging and
containers.
The local forest products industry includes the manufacture of lumber, plywood, paper products, furniture,
acoustical materials and specialty wood products. Timber in the region is harvested under sustained-field
programs on federal, state and private timberlands. The leading forest products employer is the
Weyerhaeuser Company, which operates lumber mills locally and has its corporate headquarters and a major
research and development center in southwestern portion of the County. Employment and production levels
within this industry locally have been and are expected to be further impacted by recent decisions by the
federal government and the courts concerning the exporting of raw logs and restrictions on the harvesting of
trees on federal lands in "old growth" forests. The extent of such impact is unknown at this time. The wood
and paper products industry accounts for approximately one percent of the total Seattle PMSA employment.
Higher Education
The University of Washington (the "University") is one of the oldest and largest state assisted universities on
the West Coast. Its primary campus is located in Seattle with satellite campuses located in Bothell and
Tacoma. Established in 1861, the University has 16 schools and colleges offering instruction in more than
200 academic disciplines. Undergraduate and graduate student enrollment for fall semester 2005 was
42,974. The University h~ a biennial operating budget of approximately $2.5 billion and consistently ranks
among the top five institutions of higher learning in the United States when measured by the receipt of
federal grants. The largest share of this funding goes to the University of Washington School of Medicine.
Harborview Medical Center is the University’s teaching hospital. Every physician practicing at Harborview
is a member of the University’s School of Medicine faculty. This relationship has been essential to
Harborview’ s development of outstanding patient care services including the region’s bum, trauma, epilepsy,
and spinal cord rehabilitation centers. Other higher education facilities in the Seattle area include two
private four-year universities, Seattle Pacific University (3,779 enrollment) and Seattle University (6,810
enrollment), and seven community colleges.
Services, Tourism, Recreation and Conventions
The Seattle area is the health care center of the Pacific Northwest. There are 26 general-acute and four
special purpose hospitals, more than 4,500 beds, and approximately 3,000 physicians.
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The State’s fourth largest industry is tourism. There are over 8,000 hotel rooms in over 50 hotels and motels
in downtown Seattle. Seattle ranks in the top five cities in the nation in terms of hotel occupancy with 2004
occupancy rates of 64.2% with room rates averaging $95.48 per night. According to the Seattle-King County
Convention and Visitors Bureau, convention goers added approximately $432 million to the economy in
2004. The Washington State Convention and Trade Center currently occupies 102,000 square feet of heavy
load exhibition space and an expansion of approximately 105,000 square feet of which 70,000 square feet is
designed as clear span, column-free space. The Convention Center has the capacity to hold events involving
as many as 11,000 people. It is estimated that the Convention Center generates direct spending by visitors of
over $200 million annually on hotels, restaurants, entertaining, transportation and retail shopping.
Bordered on the west by Puget Sound and the Olympic Mountains and on the east by the Cascade Mountain
range, the 2,128 squar~ miles in the County offer many types of outdoor recreation. The County and the City
of Seattle maintain over 9,000 acres of parkland. The Seattle area has several symphony orchestras, five
theaters, an opera company, and four resident dance groups. The area is also the home to more than 3,000
artists and 1,300 arts organizations.
The Seattle Center, located one mile north of the central business district of Seattle, was the site for the 1962
World’s Fair and it continues to be a popular attraction for residents and tourists alike. The 74-acre, year-
round convention and family entertainment center includes the Pacific Science Center, Coliseum, Seattle
Opera House, Key Arena, Memorial Stadium, Space Needle, the Experience Music Project and a number of
meeting and display rooms. Key Arena serves as the home of Seattle’s third major league sports team, the
National Basketball Association’s Seattle Supersonics. A major renovation project was recently completed
at the Coliseum.
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Population Trends
The area’s population has grown significantly in recent years and based on recent population trends is
expected to continue to grow. The County is the most populated county in the State. Historical population
trends are presented below for the City, the County and the State to represent population trends in the area.
City of Percent of King Percem of State of Percent of
Year Renton Change County Change Washington Change
20051 58,360 16.6%1,808,300 4.1%6,256,400 6.1%
2000 50,052 20.1 1,737,046 15.2 5,894,143 21.1
1990 41,688 36.2 1,507,305 18.7 4,866,663 17.8
1980 30,612 --1,269,898 --4,132,353 --
Intercensus estimate as of April 2005 reported by the State Office of Financial Management and City estimate is as of 2006.
Source: U.S. Bureau of the Census and Washington State Office of Financial Management.
Trends in Building Permits
The following table reveals the trends in the valuation of new construction on building permits issued by the
City for the years shown. Numbers shown are in thousands.
Year
2005
2004
2003
2002
2001
Single Family Multi Family Commercial Other Total
Permits Permits Permits Permits Permits
No.Value No.Value No.Value No.Value No.Total Value
25 $116,967,661 7 $30,373,496 22 $8,843,970 301 $5,150,248 857 $161,335,376
505 101,123,404 16 6,348,156 33 34,470,188 390 5,377,325 944 147,319,073
564 118,932,283 1 8,741,532 16 14,065,511 546 7,084,420 1,127 148,823,745
475 78,906,931 26 10,004,782 46 31,113,577 339 5,068,547 886 125,093,837
376 57,526,127 15 16,635,694 9 3,717,968 474 5,301,519 874 83,181,308
Source:The City
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Historical Taxable Retail Sales
The following table lists the taxable retail sales for all industries within the City and the County since 2001.
Figures shown are in (000’s).
Source:
Year CityofRenton King County
2005 $1,951,188 $40,463,997
2004 1,853,297 37,253,104
2003 1,763,640 35,370,831
2002 1,677,825 35,159,213
2001 1,306,652 35,313,326
Washington State Department of Revenue
Major Employers - City of Renton and State of Washington
The top ten major employers based upon the number of employees in the City as of December 2005 are as
follows. The top ten employers in the City employ approximately 49.9% of the total employees working
with the City as of the 2005 city workforce estimates (35,600).
Employer
The Boeing Company
PACCAR
Valley Medical Center
Renton School District
Industry No. Employees
Aerospace & Computer Services 10,865
Heavy Manufacturing 1,710
Healthcare 1,630
Education 1,348
City of Renton
ER Solutions
Young’s Columbia of Washington
Wal Mart
Fry’s Electronics
IKEA
Local Government 709
Loan Brokers 468
Beer/wine distributor 379
Retailer 377
Retail 343
Retail 339
% of Total
30.5%
4.8
1.6
3.8
2.0
1.3
1.1
1.1
1.0
1.0
Source: The City
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The major employers in the State of Washington as of January 2005 for full-time employees are as follows:
Employer Type of Business Activity
1. The Boeing Company Aerospace Manufacturing
2. Microsoft Corporation*Software
3. University of Washington*Higher Education
4. The Krueger Co.Retail
5. United States Postal Services Mail Delivery
6. Starbucks Coffee*Retail
7. Providence Health System*Healthcare
8. Group Health Cooperative*Healthcare
9. Washington Mutual, Inc.*Financial Services
10. Home Depot, Inc.Retail
11. Weyerhauser Co.*Forestry Products
12. Costco Wholesale*Wholesale Warehouse
13. Cingular Wireless Telecommunications
14. Nordstrom, Inc.*Retail
15. Washington State University Higher Education
16. Macy’s Retail
17. Safeway, Inc.Retail
18. Sears Roebuck & Co.Retail
19. Safeco Corporation*Insurance
20. Swedish Health Service Healthcare
Employment
55,400
28,007
21,358
17,300
13,214
8,908
8,499
8,422
7,658
7,800
7,700
6,525
5,400
5,349
5,075
4,905
4,881
4,173
3,700
3,583
* Headquartered in King County
Source: Economic Development Council of King County and Puget Sound Business Journal’s Book of Lists
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Employment by Major Industry
The table below sets forth the total number of full-time and part-time employees in the County for the years
and industries as shown.
Employment by Place of Work:
Total Employment
By Type:
Wage and Salary
Proprietor
Farm
Non-Farm
By Industry:
Farm
Non-Farm
Private
Ag. Services, Forestry, Fish. & Other
Mining
Utilities
Construction
Manufacturing
Wholesale Trade
Retail Trade
Transportation and Warehousing
Information
Finance, Insurance & Real Estate
Real Estate, Rental and Leasing
Professional and Technical Services
Management of Companies
Administrative and Waste Services
Educational Services
Healthcare and Social Assistance
Art, Entertainment and Recreation
Accommodation and Food Services
Other Services
Government & Government Enterprises
Federal/Civilian
Military
State and Local
2001 2002 2003 2004
1,437,294 1,396,814 1,386,772 1,407,313
1,225,246 1,179,964 1,164,149 1,174,680
212,048 216,850 222,623 232,333
1,314 1,316 1,267 1,250
210,734 215,534 221,356 231,083
2,209 2,158 2,091 2,011
1,435,085 1,394,656 1,384,681 1,405,002
1,270,291 1,225,582 1,214,919 1,235,498
4,836 5,327 4,815 4,503
1,483 1,262 1,430 1,523
1,418 1,282 1,191 955
79,272 74,239 73,063 75,135
139,153 126,557 113,424 111,356
71,512 68,678 67,735 68,766
143,212 138,684 138,250 138,853
56,123 52,304 50,877 51,674
77,073 72,194 71,724 72,697
70,946 69,996 70,930 69,805
59,224 58,718 61,518 63,807
134,225 126,929 125,879 126,713
21,327 22,046 22,988 23,488
77,650 73,846 74,414 80,302
26,287 26,228 26,928 27,803
114,0t9 115,821 117,476 121,221
35,341 36,274 37,107 39,316
88,851 85,847 87,075 88,628
68,339 69,350 68,095 68,953
164,794 169,074 169,762 169,504
20,831 21,328 22,221 22,076
7,653 7,685 7,683 7,487
136,310 140,061 139,558 139,941
Source: U.S. Department of Commerce, Regional Economic Information System, Bureau of Economic
Analysis.
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Labor Force and Unemployment
The following table shows labor force and employment data for the County since 2000 as well as
unemployment rates for the State and the United States for the same period.
Unemployment Rates
King State of
Year Labor Force Employment County Washington United States
2005 1,008,800 961,600 4.7%5.5%5.1%
2004 993,400 942,600 5.1 6.2 5.5
2003 984,700 923,300 6.2 7.4 6.1
2002 980,600 920,100 6.2 7.3 5.8
2001 986,100 936,100 5.1 6.2 4.8
2000 980,900 941,400 4.0 5.0 4.0
Source: Washington Employment Department and U.S. Department of Labor-Bureau of Labor Statistics
Personal Income Trends
The following table shows total and per capita personal income growth in the County from 1999 through
2004.
Total Personal Percent of Per Capita Percent of
Year Income (000’s)Change Income Change
2004 $87,617,622 tl.6%$49,286 10.8%
2003 78,534,839 0.8 44,482 0.4
2002 77,940,608 1.4 44,313 1.1
2001 76,883,017 (3.2)43,842 (4.0)
2000 79,448,105 6.6 45,682 6.0
Source: U.S. Department of Commerce, Regional Economic Information Center, Bureau of Economic
Analysis
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Earnings By Industry
The following table shows the County total personal income as well as wage and salary, labor and
proprietors’ earnings by major industry type for the years 2001 through 2004. Figures shown are in
thousands (000’s).
Total Personal Income
Earnings by Industry
Farm
Non-Farm
Private
Ag. Serv., Forest., Fishing
Mining
Utilities
Construction
Manufacturing
Wholesale Trade
Retail Trade
Transportation and Warehousing
Information
Finance and Insurance
Real Estate, Rental and Leasing
Professional!Technical Services
Management of Companies/Enterprises
Educational Services
Healthcare and Social Assistance
Arts, Entertainment and Recreation
Accommodation and Food Services
Other Services
Gov’t & Gov’t Enterprises
Federal/Civilian
Military
State and Local
2001 2002 2003 2004
$76,883,017 $77,940,608 $78,534,839 $87,617,622
46,539 39,475 47,494 52,937
77,412,537 77,252,105 78,059,846 81,495,828
69,261,504 68,652,186 69,016,976 72,038,102
525,536 481,465 519,134 534,479
47,031 43,957 46,458 53,209
30,457 259,494 258,145 256,075
4,480,439 4,338,543 4,307,287 4,658,173
9,329,994 10,032,739 9,305,326 9,581,536
4,770,343 4,684,635 4,761,518 5,273,439
4,538,665 4,585,947 4,600,844 4,875,848
2,965,504 2,962,889 3,078,211 3,292,861
12,335,468 11,294,011 10,885,868 10,202,084
4,743,590 4,783,271 5,259,446 5,441,098
2,020,681 1,991,173 2,153,650 2,420,676
8,892,569 8,377,695 8,167,371 8,464,929
1,858,600 1,934,555 2,116,715 2,387,239
571,589 585,147 603,215 650,463
4,826,114 2,637,410 2,744,040 2,982,895
883,865 860,519 939,069 1,076,398
1,785,899 1,804,795 1,882,522 1,979,170
1,778,393 1,858,060 1,975,526 2,070,784
8,151,033 8,600,919 9,042,870 9,457,726
1,689,697 1,771,834 1,849,102 1,981,584
194,755 238,190 299,964 316,327
6,266,581 6,590,895 6,893,804 7,159,815
Source: U.S. Department of Commerce Regional Economic Information System Bureau of Economic
Analysis
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APPENDIX B
Continuing Disclosure
Undertaking to Provide Continuing Disclosure
This section constitutes the City’s written undertaking for the benefit of the Owners and Beneficial Owners
of the Bonds required by subsection (b)(5)(i) of the Rule 15c2-12 (the "Rule") of the United States Securities
and Exchange Commission (the "SEC").
The City hereby agrees to provide or cause to be provided to each then existing NRMSIR, to the SID, if one
is created, and to the Bond Insurer the following annual financial information and operating data
(collectively, the "Annual Financial Information’’) for each prior fiscal year, commencing with the fiscal year
ending December 31, 2006, on or before the last day of the seventh month following the end of such prior
fiscal year:
(a) Annual financial statements prepared in accordance with the generally accepted
accounting principles applicable to governmental units, as such principles may be changed from time
to time and as permitted by State law; which statements will not be audited, except that if and when
audited financial statements are otherwise prepared and available to the City, they will be provided
(the "Annual Financial Statements");
(b)The assessed valuation of taxable property in the City;
(c)Ad valorem taxes due and the percentages of taxes collected;
(d)Property tax levy rates per $1,000 assessed valuation;
(e)A statement of authorized, issued and outstanding general obligation indebtedness of
the City; and
(f) A narrative explanation of the reasons for any amendments to this Section 17 made
during the previous fiscal year and the impact of such amendments on the Annual Financial
Information being provided.
In its provision of such financial information and operating data, the City may cross-reference to any"final
official statement" (as defined in the Rule) available from the Municipal Securities Rulemaking Board (the
"MSRB") documents theretofore provided to each then existing NRMSIR or the SID, if one is created.
If not submitted as part of the Annual Financial Information, then when and if available, the City shall
provide its Annual Financial Statements, which shall have been audited by such auditor as shall be then
required or permitted by the State law, to each then existing NRMSIR, to the SID, if one is created, and to
the Bond Insurer.
The City further agrees to provide or cause to be provided, in a timely manner,~to the S ID, if one is created,
and to either the MSRB or each then existing NRMSIR and to the Bond Insurer, notice of any of the
following events with respect to the Bonds, if material:
1.Principal and interest payment delinquencies;
2.Non-payment related defaults;
3.Unscheduled difficulties;
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4.Unscheduled draws on credit enhancements reflecting financial difficulties;
5.Substitution of credit or liquidity providers, or their failure to perform;
6.Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
7.Modification to rights of the Owners of the Bonds;
8.Optional redemptions of the Bonds;
9.Defeasances of the Bonds;
10.Release, substitution or sale of property securing repayment of the Bonds; and
11.Rating changes.
The City also agrees to provide or cause to be provided, in a timely manner, to the SID, if one is created, and
to either the MSRB or each then existing NRMSIR, notice of its failure to provide the Annual Financial
Information for the prior fiscal year on or before the last day of the seventh month following the end of such
prior fiscal year.
After the issuance of the Bonds, so long as the interests of the Owners or Beneficial Owners of the Bonds
will not be materially impaired thereby, as determined by a party unaffiliated with the City (including,
without limitation, a trustee for the Owners, nationally recognized bond counsel or other counsel familiar
with the federal securities law), or pursuant to a favorable "no-action letter" issued by the SEC, the
Undertaking to Provide Continuing Disclosure may only be amended in connection with any change in legal
requirements, change in law, or change in the identity, nature or status of the obligated person, or type of
business conducted, and only in such a manner that the undertaking of the City, as so amended, would have
complied with the requirements of the Rule at the time of the primary offering, after taking into account any
amendments or interpretations of the Rule, as well as any change in circumstances.
The City’s obligations to provide Annual Financial Information and notices of certain events shall terminate
without amendment upon the defeasance, prior redemption or payment in full of all of the then outstanding
Bonds. The Undertaking to Provide Continuing Disclosure or any provision hereof, shall be null and void if
the City (i) obtains an opinion of nationally recognized bond counsel or other counsel familiar with the
federal securities laws to the effect that those portions of the Rule which require the Undertaking to Provide
Continuing Disclosure or any such provision are invalid, have been repealed retroactively or otherwise do
not apply to the Bonds; and (ii) notifies and provides the SID, if any, and either the MSRB or each then
existing NRMSIR with copies of such opinion.
The right of each Owner or Beneficial Owner of Bonds to enforce the provisions of the Undertaking to
Provide Continuing Disclosure shall be limited to the fight to obtain specific enforcement of the City’s
obligations herein, and any failure by the City to comply with the provisions of this undertaking shall not be
a default with respect to the Bonds under this Ordinance.
The City Finance and Information Services Administrator is authorized and directed to take such further
action on behalf of the City as may be necessary, appropriate or convenient to carry out the requirements of
the Undertaking to Provide Continuing Disclosure.
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APPENDIX C
Form of Legal Opinion
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Form of Approving Opinion of
Gottlieb, Fisher & Andrews, PLLC,
Bond Counsel
August 8, 2006
Mayor and City Council
City of Renton
Renton, Washington 98055
Ladies and Gentlemen:
We have acted as bond counsel in connection with the issuance by the City of Renton,
Washington (the "City"), of the bonds described below (the "Bonds"):
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
Dated: August 1, 2006
The Bonds are issued pursuant to Ordinance No. 5215 of the City (the "Bond
Ordinance") and other proceedings duly had and taken in conformity therewith. The Bonds are
issued to provide part of the funds necessary to pay the costs of constructing transportation and
utility infrastructure and improvements in the South Lake Washington Infrastructure project and
the SW 27t~ Street Extension project, and to pay incidental costs thereof and the costs related to
the sale and issuance of the Bonds, all as provided in the Bond Ordinance.
The Bonds shall be issued in fully registered form as to both principal and interest; shall
be in the denomination of $5,000 each or any integral multiple thereof within a single maturity.
The Bonds bear interest (computed on the basis of a 360-day year of twelve 30-day months) from
their date or from the most recent interest payment date to which interest has been paid or duly
provided for, whichever is later, payable December 1, 2006, and semiannually thereafter on each
June 1 and December 1 to the maturity or earlier redemption thereof, at the rates set forth below,
and shall mature on December 1 in each of the years and in the principal amounts set forth
below:
C-2
Maturity Date Principal Interest Rate
(December 1)Amount Per Annum
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
$520,000 4.25%
540,000 4.25
565,000 3.90
585,000 4.25
610,000 5.00
640,000 4.50
670,000 5.25
700,000 5.25
750,000 4.30
775,000 5.00
2019"1,670,000 5.00
2020
2021
2022
2023
2024
900,000 5.00
945,000 5.00
1,000,000 5.25
1,040,000 5.25
1,095,000 5.25
2028*4,975,000 5.00
*Term Bonds
The Bonds shall be subject to redemption prior to maturity at the times and in the manner
described in the Bond Ordinance. The City has reserved the right to purchase any or all of the
Bonds in the open market at any time and at any price.
In rendering this opinion letter, we have examined the following: (i) the Bond
Ordinance; (ii) a copy of one executed and authenticated Bond (we assume that all other Bonds
are in the same form and have been similarly executed and authenticated); and (iii) the certified
proceedings of the City and other certificates of public officials and representatives of the City
which have been famished to us and which comprise the transcript of proceedings pertaining to
the issuance of the Bonds (the "Transcript").
As to questions of fact material to the opinions expressed herein, we have relied upon
the certified proceedings of the City and other certificates of public officials and representatives
of the City which have been famished to us as part of the Transcript, all wfthout undertaking to
verify the same by independent investigation.
C-3
Based only upon the foregoing and our examination of such questions of law as we have
deemed necessary or appropriate for the purpose of this opinion letter, and subject to the
limitations and qualifications expressed below, we are of the opinion that, as of this date:
1. The Bonds are lawfully authorized and issued pursuant to and in full compliance
with the constitution and statutes of the State and the Bond Ordinance.
2. The Bonds are legal, valid and binding general obligations of the City, enforceable
against the City in accordance with their terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting creditors’ rights, and also to the exercise of judicial
discretion in accordance with general principles of equity.
3. The City has irrevocably covenanted in the Bond Ordinance that, unless the
principal of and interest on the Bonds are paid from other sources, so long as the Bonds are
outstanding, the City shall include in its budgets and make annual levies of taxes within the
constitutional and statutory tax limitations provided by law without a vote of the qualified voters
of the City upon all property within the City subject to taxation in amounts which, together with
any other money legally available therefor, shall be sufficient to pay such principal and interest
on the Bonds as the same shall become due. The City has irrevocably pledged its full faith, credit
and resources to the annual levy and collection of such taxes and for the prompt payment of such
principal and interest.
4. Assuming compliance by the City with applicable requirements of the Internal
Revenue Code of 1986, as amended (the "Code), that must be met subsequent to the issuance of
the Bonds, interest on the Bonds, including any original issue discount properly allocable to an
owner thereof, is excludable from gross income for federal income tax purposes under existing
federal law and is not an item of tax preference for purposes of determining the federal
altemative minimum tax imposed on individuals and corporations under existing federal law.
However, under existing federal law, interest on the Bonds, including any original issue discount
properly allocable to an owner thereof, is taken into account in determining adjusted current
eamings for the purpose of computing the altemative minimum tax imposed on certain
corporations.
Except as stated in the preceding paragraph 4, we express no opinion as to any federal or
state tax consequences of receipt of interest on the Bonds.
The Code contains certain requirements that must be satisfied subsequent to the date of
issuance of the Bonds in order to maintain the exclusion of interest on the Bonds from gross
income for federal income tax purposes, including requirements relating to application of the
proceeds of the Bonds, use of facilities financed with such proceeds, limitations on income
derived from the investment of gross proceeds of the Bonds (as defined in Section 148 of the
Code), and rebate to the United States Treasury of certain investment earnings on such gross
proceeds. The City has covenanted to comply with these requirements to the extent applicable,
and the opinion expressed in paragraph 4 assumes such compliance. However, we have not
C-4
undertaken and do not undertake to monitor compliance by the City with such requirements; and
if the City should fail to comply with such requirements, interest on the Bonds could become
includable in gross income for federal income tax purposes retroactive to the date of issuance of
the Bonds.
We have not been engaged to participate in the preparation or review of, or to express any
opinion concerning the completeness or accuracy of, the official statement or other disclosure
documentation used in connection with the offer or sale of the Bonds, and thus express no
opinion concerning the completeness or accuracy thereof.
Copies of this opinion letter may be delivered to the Owners of the Bonds, who may rely
on this opinion letter as if it were addressed to such Owners on the date hereof. Subject to the
foregoing, this opinion letter may be relied upon by you only in connection with the issuance of
the Bonds and may not be used or relied upon by you or any other person for any other purpose
whatsoever, without in each instance our prior written consent. We expressly disclaim any
responsibility to advise you or any Owners of any developments in areas covered by this opinion
letter that occur after the date hereof.
Respectfully submitted,
GOTTLIEB, FISHER & ANDREWS, PLLC
By
Judith L. Andrews
C-5
[This Page Intentionally Left Blank.]
APPENDIX D
Municipal Bond Insurance
Policy Specimen
D-1
[This Page Intentionally Left Blank.]
FINANCIAL GUARANTY INSURANCE POLICY
MBIA Insurance Corporation
Armonk, New York 10504
MBIA Insurance Corporation (the "Insurer’), in consideration of the payment of the premium and subject to the terms of this policy, hereby unconditionally
and irrevocably guarantees to any owner, as hereinatter defined, of the following descn’bed obligations, the full and complete payment required to be made by
or on behalf of the Issuer to [PAYING AGENT/I’RUSTEE] or its successor (the "Paying Agenf’) of an amount equal to (1") the principal of (either at the stated
maturity or by any advancement ofmaturity pursuant to a mandatory sinking fund payment) and interest on, the Obligations (as that term is defined below) as
such payments shall become due but shall not be so paid (except that in the event of any acceleration of the due date of such principal by reason of mandatory
or optional redemption or acceleration resulting from default or otherwise, other than any advancement of maturity pursuant to a mandatory sinking fund
payment, the payments guaranteed hereby shall be made in such amounts and at such limes as such payments ofprincipal would have been due had there not
been any such acceleration, unless the Lnsurer elects in its sole discretion, to pay in whole or in part any principal due by reason of such acceleration); and (i,i)
the reimbursement of any such payment which is subsequently recovered from any owner pursuant to a final judgment by a court ofcompetentjurisdic~on that
such payment constitutes an avoidable preference to such owner within the meaning of any applicable bankruptcy law. The amounts referred to in clauses (~
and (ii) of the preceding sentence shall be referred to herein collectively as the "Insured Amounts." "Obligations" shall mean:
I ARI
[LEGAL NAME OF ISSUE]
Upon receipt of telephonic or telegraphic notice, such notice subsequently confirmed in writing by registered or certified mail, or upon receipt of
written notice by registered or certified mail, by the Insurer from the Paying Agent or any owner of an Obligation the payment of an Insured
Amount for which is then due, that such required payment has not been made, the Insurer on the due date of such payment or within one business
day after receipt of notice of such nonpayment, whichever is later, will make a deposit of funds, in an account with U.S. Bank Trust National
Association, in New York, New York, or its successor, sufficient for the payment of any such Insured Amounts which are then due. Upon
presentment and surrender of such Obligations or presentment of such other proof of ownership of the Obligations, together with any appropriate
instruments of assignment to evidence the assignment of the Insured Amounts due on the Obligations as are paid by the Insurer, and appropriate
instruments to effect the appointment of the Insurer as agent for such owners of the Obligations in any legal proceeding related to payment of
Insured Amounts on the Obligations, such instruments being in a form satisfactory to U.S. Bank Trust National Association, U.S. Bank Trust
National Association shall disburse to such owners, or the Paying Agent payment of the Insured Amounts due on such Obligations, less any
amount held bythe Paying Agent for the payment of such Insured Amounts and legally available therefor. This policy does not insure against loss
of any prepayment premium which may at any time be payable with respect to any Obligation.
As used herein, the term "owner" shall mean the registered owner of any Obligation as indicated in the books maintained by the Paying Agent, the Issuer, or
any designee of the Issuer for such purpose. The term owner shall not include the Issuer or any paw whose agreement with the Issuer constitutes the
underlying security for the Obligations.
Any service of process on the Insurer may be made to the Insurer at its offices located at I 13 King Street, Armonk, New York 10504 and such service of
process shall be valid and binding.
This policy is non-cancellable for any reasor~ The premium on this policy is not refundable for any reason including the payment prior to malurity of the
Obfigations.
IN W1TNESS WHEREOF, the Insurer has caused this policy to be executed in facsimile on its behalf by its duly authorized officers, this pAY] day of
[MONTH,
STD-R-7
01/05
Attest:
MBIA Insurance Corporatio~
Assistant Secretary
D-2
[This Page Intentionally Left Blank.]
[This Page Intentionally Left Blank.]
STANDARD
&POOR’S
55 Water Street, 38th Floor
New York, NY 10041-0003
tel 212 438-2074
reference no,: 777377
August 4, 2006
MBIA Insurance Corporation
113 King Street
Am~onk, NY 10504
Attention: Mr. Adam Carta, Assistant Vice President
$17,980,000 City of Renton, IVashin~on Limited Tax General Obligation Bonds, 2006,
dated: Augast 1, 2006, Serial Bonds due: December 1, 2008-2017, 2020-2024; Term Bonds
due: December 1, 2019 and 2028, (POLICY#48291)
Dear Mr. Carta:
Standard & Poor’s has reviewed the rating on the above-referenced obligations. After such
review, we have changed the rating to "AAA" from "AA-". The rating reflects our assessment of
the likelihood of repayment of principal and interest based on the bond insurance policy your
company is providing. Therefore, rating adjustments may result from changes in the financial
position of your company or from alterations in the documents governing the issue.
The rating is not investment, financial, or other advice and you should not and cannot rely upon
the rating as such. The rating is based on information supplied to us by you but does not represent
an audit. We undertake no duty of due diligence or independent verification of any information.
The assigana-nent of a rating does not create a fiduciary relationship bet~veen us and you or between
us and other recipients of the rating. We have not consented to and will not consent to being
named an "expert" under the applicable securities laws, including without limitation, Section 7 of
the Securities Act of 1933. The rating is not a "market rating" nor is it a recommendation to buy,
hold, or sell the obligations.
This letter constitutes Standard & Poor’s permission to you to disseminate the above-assigned
rating to interested parties. Standard & Poor’s reserves the right to inform its own clients,
subscribers, and the public of the rating.
Standard & Poor’s relies on the issuer and its counsel, accountants, and other experts for the
accuracy and completeness of the information submitted in connection with the rating. This rating
is based on financial information and documents we received prior to the issuance of this letter.
Standard & Poor’s assumes that the documents you have provided to us are final. If any
subsequent changes were made in the final d0.c, umer~ts, you must notify us of such changes by
sending us the revised final documents with the changes dearly marked.
Mr. Adam Carta
Page 2
August 4, 2006
Standard & Poor’s is pleased to be of service to you. For more information please visit our
~vebsite at ~wwv.standardandpoors.com. If we can be of help in any other way, please contact us.
Thank you for choosing Standard & Poor’s and we look forward to working with you again.
Sincerely yours,
Standard & Poor’s Ratings Services
a division of The McGraw-Hill Companies, Inc.
ms
FitchRatings
Poweil. ,/1"~’ 82435
T 307 754 2.01~ / ,900 0£ FITCH
August 4, 2006
Ms. Lisa Wilson
MBIA Insurance Corp.
113 King Street
Arrnonk, NY 10504
Re: Renton (WA) / Policy # 48291
Dear Ms. Wilson:
Fitch Ratings has assigned one or more ratings and/or otherwise taken rating action(s), as debailed
on the attached Notice of Rating Action.
Ratings assigned by Fitch are based on documents and in,’~rmation provided to us by issuers,
obligors, and/or their experts and agents, and are subject to receipt of the final closing documents. Fitch
does not audit or verify the truth or accuracy of such information.
It is important that Fitch be provlded with all Information that may be material to its ratings so that
they continue to accurately ret]ect the status of the rated issues. Ratings may be changed, withdrawn,
suspended or placed on Rating Watch due to changes In, additions to or the inadequacy of information.
Ratings are not recommendations to buy, sell or hold securities. Ratings do not comment on the
adequacy of market pric~, the suitabillty of any security for a particular investor, or the tax-exempt nature
or taxability of payments made in respect of any security.
The assignment of a rating by Fitch shall not constitute a consent by Fitch to use its name as an
expert in connection with any regis~ation statement or other filing under U.S., U.K., or any other relevant
securities laws.
We are pleased to have had the opportuniby to be of service to you. If we can be of further
assistance, please feel free to contact us at any time.
Sincerely,
Insured Ratings Manager
DLS/ds
Enc:Notice of Rating Action
(Ooc ID: 46326)
0u104f2006 14UB bAX {54(~85 FITCH + t~BiA ~003f003
Notice of Rating Action
Bond DascHpllan Rating Type A~ie__n
Renton (WA) GO lid t~× bond~, set 2006 (insured; MBIA Long Term Upgrade
Insurance Carp,)
Out~oold
Watch Eft Date Notes
RO:SLs 0~Aug-2006 1
Key:
Notes
1
Re: Rating Outlook, RW: Rating Watch; Pos: Positive, Nag: Nogalive, Sty: Slable, F_.vo: Evolving
The rating Is based solely on credlL enhancement provided I~y a bond insuranC~ policy Issued by MBIA Insurance Corp..
which ha~ an Insurer Pqnanc~al Stranglh rating of’AAA’.
(Dec IO: 46326) Paga 1 of I
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eq~ uo ;ueLut.uo9 lou op s6uHeN -se!~pnoes ploq ~o lies ’~nq o; suo.qepueLu,,,oaaJ ~,ou eJe s6u!~eN
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"uo!loV 6u]le~{ jo ao!~ON peqDe;3e eql uo
pel!elep se ’(s)uo!loe ~L~!IBJ ue>{e~ es!^ueqlo ,o!pue £~u!leJ eJoL~ JO eUO peu6!sse seq s6u!le~l
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Y~al!e8 leeqa!Vl
900~’z1sn6nv
Notice of Rating Action
Outlook/
Bond Description Rating Type Action Rating Watch
Renton (WA) GO Itd tax bonds ser 2006 (insured: MBIA Long Term New Rating hA-RO:S~a
Insurance Corp.)
Renton (WA) GO Itd tax bonds ser 2002 (insured:Long Term Upgrade AA-RO:Sta
Financial Security Assurance Inc.
Renton (WA) GO Itd tax rfdg bonds ser 2001 (insured:Long Term Upgrade AA-RO:Sta
Financial Security Assurance Inc. (FSA))
Eft Date
06-Jul-2006
06-Jul-2006
06-Jul-2006
Key:Re: Rating Outlook, RW: Rating Watch; Pos: Positive, Neg: Negative, Sta: Stable, Eve: Evolving
Notes
1 The rating is based solely on credit enhancement provided by a bond insurance policy issued by MBIA Insurance Corp.,
which has an Insurer Financial Strength rating of ’AAA’.
2 The rating is an underlying rating, given without consideration of credit enhancement.
Notes
1
2
2
(Dec tD: 46472) Page 1 of I
CERTIFICATE OF DELIVERY AND PAYMENT
I, MICHAEL E. BAILEY, hereby certify that:
1. I am the duly appointed, qualified and acting Finance and Information Services
Administrator of the Cityof Renton, Washington (the "City").
2. On the 8th day of August, 2006, the City delivered to D.A. Davidson & Co. (the
"Underwriter") each and every one of the $17,980,000 CITY OF RENTON, WASHINGTON,
LIMITED TAX GENERAL OBLIGATION BONDS, 2006 (the "Bonds").
3. On this date, the Underwriter paid, on behalf of the City, to MBIA Insurance
Corporation, the issuer of the financial guaranty insurance policy for the Bonds (the "Insurance
Policy’’), by means of wire transfer the premium for the Insurance Policy in the amount of
$49,000.00. Also on this date, the City received the sum of $18,490,028.72 from the
Underwriter, said sum being full payment of the aggregate purchase price therefor, computed as
follows:
Principal Amount of Bonds
Plus: Net Original Issue Premium
Plus: Accrued Interest from August 1, 2006
Less: Underwriter’s Discount
Purchase Price of the Bonds
Less: Premium for the Insurance Policy
Aggregate Purchase Price of the Bonds
$17,980,000.00
660,506.35
17,174.50
(118,652.13)
$18,53~028.72
(49,000.00)
$18,490.028.72
IN WITNESS WHEREOF, I have hereunto subscribed my signature as of the 8th day of
August, 2006.
MICHAEL E.
Finance and Information Services Administrator
City of Renton, Washington
f:~renton\ltgo 06
UNDERWRITER’S RECEIPT
The undersigned acknowledges receipt from the City of Renton, Washin~on (the
"City"), of each and every one of the $17,980,000 CITY OF RENTON, WASHINGTON,
LIMITED TAX GENE ..RAL OBLIGATION BONDS, 2006 (the "Bonds").
The Bonds are satisfactory in form.
Upon receipt of the Bonds this day, the undersigned paid, on behalf of the City, to MBIA
Insurance Corporation, the issuer of the financial guaranty insurance policy for the Bonds (the
"Insurance Policy’’), by means of wire transfer the premium for the Insurance Policy in the
amount of $49,000.00. Also on this date, the undersigned paid to the City the aggregate
purchase price of the Bonds, computed as follows:
Principal Amount of Bonds
Plus: Net OriNnal Issue Premium
Plus: Accrued Interest from August 1, 2006
Less: Underwriter’s Discount
$17,980,000.00
660,506.35
17,174.50
(118,652.13)
Purchase Price of the Bonds $18,539,028.72
Less: Premium for the Insurance Policy (49,000.00)
Aggregate Purchase Price of the Bonds $18,490,028.72
DATED this 8th day of August, 2006.
D.A. DAVIDSON & CO.
By
FRED R. EOFF
ManaNng Director
f:~renton\ltgo 06
TAX EXEMPTION AND NONARBITRAGE CERTIFICATE
This TAX EXEMPTION AND NONARBITRAGE CERTIFICATE (this "Certificate") is
made and delivered by the undersigned in connection with the issuance of the $17,980,000 CITY
OF RENTON, WASHINGTON, LIMITED TAX GENERAL OBLIGATION BONDS, 2006
(the "Bonds") by the City of Renton, Washington (the "City"). This Certificate is also made and
delivered by the undersigned (a) in furtherance of the covenants of the City contained in Section
15 of Ordinance No. 5215 (the "Bond Ordinance"), duly adopted on July 17, 2006; and
(b) pursuant to the Code and Treasury Regnlations Sections 1.148-1 throu~h 1.148-11, inclusive,
1.149(b)-1, 1.149(d)-!, 1.149(g)-!, and 1.150-1 through 1.150-2, inclusive.
Section 1. Defmitions. Capitalized terms used but not defined herein shall have the
meanings set forth in (a) the Bond Ordinance or (b) where not so defined, Extsbit A hereto,
which is incorporated herein by this reference.
Section 2. Representations.
(a) Responsible Persons. The undersigned is the Finance and Information Services
Administrator of the City and one of the persons charged by the City with responsibility for the
issuance of the Bonds, and has made due inquiry with respect to and is fully informed as to the
matters set forth in Section 3 of this Certificate.
(b) Statement as to Facts, Estimates and Circumstances. The facts, estimates and
circumstances set forth in Section 3 of this Certificate, on which the expectations of the City as
to the Bonds are based, are made to the best of the knowledge and belief of the undersigned, and
such expectations are reasonable and made in good faith. The City understands that, for the
purposes of the Code, this Certificate constitutes evidence of the expectations of the City, but
does not establish any conclusions of law or any presumptions regarding either the actual
expectations of the City, or their reasonableness.
(c) Basis of Representations and Expectations. The representations and expectations
of the City set forth herein are based upon:
(1)The covenants of the City contained in the Bond Ordinance; and
(2)The certifications ofD.A. Davidson & Co. (the "Underwriter"), set forth
in the Under~vriter’s Certificate (the "Underwriter’s Certificate") executed by the Underwriter
and delivered on the Date of Issue and included in the record of proceedings relating to the
issuance of the Bonds (the "Transcript"); and
(3) The certifications of MBIA Insurance Corporation (the "Bond Insurer"),
set forth in its certificate (the "Bond Insurer’s;Certificate"), dated and delivered on the Date of
Issue and included in the Transcript.
f:krenton\ltgo 06 1
The City is not aware of any facts or circumstances that would cause it to question the
accuracy, reliability or reasonableness of the certifications in the Under~vriter’s Certificate or the
Bond Insurer’s Certificate.
(d) Purpose of Certificate. This Certificate is made in part for the purpose of
establishing the reasonable expectations of the City as to the amount and application of proceeds
of the Bonds. It is inten~led to be and may be relied on for the purposes of Sections 103, and 141
through 150 of the Code and as a certificate described in Treasury Regulations
Section 1.148-2(b)(2), and to that end, is being executed and delivered as part of the Transcript.
The City understands that, despite the representations and statements of expectation made in this
Certificate, (1) the taking of any deliberate, intentional action by the City after the Date of Issue
in order to earn arbitrage will cause the Bonds to be "arbitrage bonds" within the meaning of
Section 148 of the Code if such action, had it been expected on the Date of Issue, would have
caused the Bonds to be arbitrage bonds, and that an intent to violate the requirements of
Section 148 of the Code is not necessary for an action to be considered intentional within the
meaning of the Code; and (2) the taking of any deliberate action subsequent to the Date of Issue
that causes the conditions of either the private loan financing test or the private business use and
repayment tests under Section 141 of the Code to be met, will cause the Bonds to be private
activity bonds within the meaning of Section 141 of the Code, and that an intent to violate the
requirements of Section 141 of the Code is not necessary for an action to be considered
deliberate within the meaning of the Code.
(e) Authorization and Purposes of the Bonds. The Bonds are being issued pursuant to
the Bond Ordinance for the purpose of providing part of the funds necessary to pay the costs of
constructing transportation and utility infrastructure and improvements in the South Lake
Washington Infrastructure project and the SW 27th Street Extension project, and to pay certain
"incidental costs and costs related to the sale and issuance" (as defined in RCW 39.46.070) of the
Bonds (the "Project"), all as described in the Bond Ordinance. The City reasonably expects that
not less than 75% of the proceeds of the Bonds wil! be applied to the payment of construction
expenditures in connection with property to be owned by a governmental unit.
(f) Security. The Bonds are limited tax general obligations of the City. The City has
irrevocably covenanted that, unless the principal of and interest on the Bonds are paid from other
sources, so long as any Bonds are outstanding, it will include in its budgets and to make annual
levies of taxes within the constitutional and statutory tax limitations provided by law without a
vote of the qualified voters of the City upon all property within the City subject to taxation in
amounts which, together with any other money legally available therefor, shall be sufficient to
pay the principal and interest on the Bonds as the same shall become due. City has further
pledged its full faith, credit and resources to the annual levy and collection of such taxes and for
the prompt payment of such principal and interest. All of such taxes shall be paid into the Bond
Fund.
-;
(g) Status of City. The City is a code city duly organized under the laws of the State
of Washington.
f:~rentonqtgo 06 2
(h) Ownership and Use of Facilities Financed With Bond Proceeds. The City now
owns and expects in the future to own and operate all facilities financed with the proceeds of the
Bonds for so long as the Bonds are outstanding. No more than 10% of the proceeds of the Bonds
are to be used, directly or indirectly, for any "private business use" (as defined in Section 141 of
the Code); and no more than 5% of the proceeds of the Bonds are to be used with respect to any
private business use that is not related to the City’s use of such proceeds for governmental
purposes, or which is digproportionate to such governmental use. Further, the payment of the
principal of and interest on no more than 10% of the proceeds of the Bonds are to be, directly or
indirectly, (1) secured by any interest in (A) property to be used for private business use, or
(B) payments in respect of such property; or (2) derived from payments in respect of property, or
borrowed money, used or to be used for a private business use; and the payment of the principal
and interest on no more than 5% of the proceeds of the Bonds are to be so. secured by or derived
from payments made in respect of private business use of the proceeds of the Bonds in a manner
which is unrelated or disproportionate to the City’s use for governmental purposes. The
"nonqualified amount," as defined in Section 14!(b)(8) of the Code, if any, with respect to the
Bonds will not exceed $15,000,000.
(i) No Private Loans. None of the proceeds of the Bonds will be used, directly or
indirectly, to make or finance loans to any person (including any governmental unit).
(j)Qualification of Bond Insurance Policy as a Qualified Guaranty.
(1) Based upon the Underwriter’s Certificate, the premium to be paid to the
Bond Insurer for the Bond Insurance Policy (A) was negotiated at arm’s len~h, and is
reasonable, and (B) the Present Value of such premium (computed by using the yield-to-maturity
on the Bonds, including such premium, as the discount factor) is less than the Present Value of
the interest reasonably expected to be saved on the Bonds as a result of the purchase of the Bond
Insurance Policy.
(2) Based upon the certifications of the Bond Insurer set forth in the Bond
Insurer’s Certificate, (A) the Bond Insurance Policy is an unconditional obligation of the Bond
Insurer to pay scheduled payments of principal of and interest on the Bonds in the event of the
failure to do so by the City; (B) the premium to be paid for the Bond Insurance Policy was
determined in arm’s-length negotiations, is required to be paid as a condition to the issuance of
the Bond Insurance Policy, and represents a charge for a transfer of credit risk; (C) no portion of
such premium represents an indirect payment of costs related to the issuance of the Bonds other
than the transfer of credit risk; (D) the Bond Insurer does not reasonably expect that it will be
called upon to make any payment under the Bond Insurance Policy; and (E) to the extent that the
Bond Insurer is called upon to make any payment under the Bond Insurance Policy, the Bond
Insurer expects to pursue all available legal remedies to secure reimbursement for such payment.
Section 3. Reasonable Expectations dfthe ~ity as to Facts. Estimates and Circumstances.
The City makes the following representations and statements of fact, estimates and expectation
to establish that it is not expected that the proceeds of the Bonds wi!l be used in a manner that
will cause the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code:
f:h-enton\ttgo 06 3
(a)Receipt and Application of Sale Proceeds.
(1) General. The City will receive on this date from the Underwriter, as the
purchase price for the Bonds, net Sale Proceeds in the amount of $18,539,028.72, which sum is
equal to the principal of the Bonds of $17,980,000.00, plus a net original issue premium of
$660,506.35, plus Pre-Issuance Accrued Interest on the Bonds from their dated date to the Date
of Issue of $17,174.50, l~ss a discount (the "Underwriter’ s Discount") of $118,652.13.
(2) Accrued Interest. The Pre-Issuance Accrued Interest received in respect
of the Bonds will be deposited into the Bond Fund (hereinafter defined) on the Date of Issue and
applied to the payment of interest on the Bonds on December 1, 2006 (the first interest payment
date for the Bonds).
(3) Bond Insurance Premium. Sale Proceeds in the amount of $49,000.00 will
be used to pay the premium for the Bond Insurance Policy on the Date of Issue.
(4) Project Costs. The remainder of the net Sale Proceeds, in the amount of
$18,472,854.22 will be deposited into the Project Fund on the Date of Issue to be applied to the
payment of costs of the Project.
Co) Investment Eaming~. Interest earned (including discount and premium) on any
moneys or investments in any Fund or Account will be retained in such Fund or Account and
used for the purposes thereof.
(c) Funds for the Bonds. The City has established the following Funds that relate to
the Bonds, each to be held separate and apart from all other funds and accounts of the City:
The "Limited Tax General Obligation Bond Fund, 2006" (the "Bond Fund") ¯
The "South Lake Washington Infrastructure Project Fund" (the "Project Fund")
Other than the funds and accounts specifically described in this Certificate, no fund or
account that secures or otherwise relates to the Bonds has been established, nor are any such
funds or accounts expected to be established, pursuant to any instrument.
(d) Bona Fide Debt Service Fund: the Bond Fund. The Bond Fund shall serve as the
bonafide debt service fund for the Bonds. All payments of annual property tax levies in respect
of debt service on the Bonds, together with other City money necessary and available for the
payment of debt service on the Bonds will be deposited into the Bond Fund, which is intended to
achieve a proper matching of current revenue and scheduled annual debt service on the Bonds.
All amounts in the Bond Fund will be;expeflded to pay debt service on the Bonds within
thirteen months of the date such amounts are first deposited into the Bond Fund. The Bond Fund
will be depleted at least once each year except for any carryover amounts which will not exceed
the greater of (1) the earnings in the Bond Fund for the immediately preceding Bond Year or
(2) one-twelfth of principal and interest payments on the Bonds for the immediately preceding
f:~renton\ltgo 06 4
Bond Year. The schedule of payment of interest on and principal of the Bonds has been
established on the basis of, and is intended to achieve, a proper matching of revenues with debt
service on the Bonds.
The City has not created or established, and does not expect to create or establish, any
fund in connection with the Bonds that is reasonably expected to be used to pay debt service on
the Bonds other than the~Bond Fund.
(e) No Replacement. No portion of the amounts received from the sale of the Bonds
will be used as a substitute for any other funds that would otherwise be used as a source of
financing for any portion of the cost of the Project and that have been or will be used to acquire,
directly or indirectly, obligations producing a yield in excess of the yield on the Bonds.
(f) No Negative Pledges. There are no amounts held under any agreement to
maintain funds at a particular level for the direct or indirect benefit of the Owners of the Bonds,
excluding for this purpose (1) amounts in which the City may pant rights that are superior to the
rights of the bondholders and (2) amounts that do not exceed the reasonable needs for which they
are maintained and that may be spent without any substantial restriction other than a requirement
to replenish the amount by a testing date that may occur no more frequently than every six (6)
months.
(g) No Excess Proceeds. The Gross Proceeds of the Bonds will not exceed the costs
of accomplishing the Project.
The Bonds will not remain outstanding longer than is otherwise reasonably necessary to
accomplish the governmental purposes of the Bonds, based on all facts and circumstances.
(h) Universal Cap. Notwithstanding any restrictions on the investment of proceeds of
the Bonds and other amounts set forth in Section 3(a) of this Certificate, proceeds of the Bonds
and other amounts treated as proceeds of the Bonds shall be allocated and remain allocated to the
Bonds, and thus be subject to the restrictions contained in this Certificate, only to the extent that
the value of such the Nonpurpose Investments allocated to proceeds does not exceed the value of
the outstanding Bonds (the "Universal Cap"). This section shall not apply to amounts on deposit
in the Bond Fund.
(i) Representations Establishin~ Eligibility for Temporary Period. A portion of the
Proceeds of the Bonds will be held in the Project Fund pending application to the payment of
Project Costs. The District reasonably expects in connection therewith that:
(1) Completion Date. Sale Proceeds of the Bonds deposited in the Project
Fund will be used to pay the costs of the Project no later than Auga~st 7, 2009.
-;
(2) Bindin~ Obligations. The City has spent or, within 6 months of the Date
of Issue of the Bonds, will spend (or enter into binding obligations with third parties obligating
the City to spend) an amount equal to at least 5% of the Sale Proceeds of the Bonds with respect
to the Project.
f:krenton\ltgo 06 5
(3) Due Diligence. Work on the Project and the allocation of the Sale
Proceeds of the Bonds to expenditures with respect thereto will proceed with due diligence.
(j) Bond Yield. The yield on the Bonds (the "Bond Yield") generally means the
discount rate that, when used in computing the Present Value as of the Date of Issue of all
unconditionally payable payments of principal, interest and fees for qualified guarantees on the
Bonds, produces an amount equal to the Present Value, using the same discount rate, of the
’ aggregate issue price of the Bonds (defined as the initia! offering price or yield to the public,
excluding bond houses, brokers or similar persons or organizations acting in the capacity of
underwriters or wholesalers, at which price or yield a substantial amount of the Bonds of each
maturity was sold) as of the Date of Issue.
For purposes of computing the Bond Yield, the Bonds maturing on December 1 in the
years 2017, 2019, 2020 through 2024, inclusive, and 2028 have been treated as redeemed at their
respective stated redemption prices on the optional redemption dates that would produce the
lowest yield thereon because such Bonds were issued at issue prices that exceed their respective
stated redemption prices at maturity by more than 0.25% multiplied by the product of their
respective stated redemption price at maturity and the number of complete years to the first
optional redemption date for the Bonds, all in accordance with Treas. Regs. § 1.148-4(b)(3).
The aggregate Present Value on the Date of Issue of the issue prices of the Bonds, as so
defined, and based upon the information in the Underwriter’s Certificate is $18,657,680.85,
which is equal to the principal amount of the Bonds of $17,980,000.00, plus net orig~al issue
discount of $660,506.35, plus Pre-Issuance Accrued Interest of $17,174.50. Based upon the
information in the Bond Insurer’s Certificate and the Underwriter’s Certificate, the premium for
the Bond Insurance Policy in the sum of $49,000.00 is a payment by or on behalf of the City to
the Bond Insurer for a "qualified guarantee" (as such term is defined in Section 1.148-4(0 of the
Treasury Regulations). Based upon the Underwriter’s Certificate, the Bond Yield computed in
this manner is, as of the date hereof, 4.5878116%. The Bond Yield is computed as of the Date of
Issue and wil! not be affected by subsequent unexpected events unless (A) the City either enters
into a hed~ng transaction, within the meaning of Treasury Regulations Section 1.148-4(h)(3)or
(B) unless there is a subsequent transfer, waiver, modification or similar transaction affecting
any ri~t that is part of the terms of a Bond. Prior to entering into any transaction described in
the immediately preceding sentence, the City shall inform Bond Counsel of its intent and shall
not enter into such transaction without receiving a prior Opinion of Bond Counsel that such
transaction will not adversely affect the exclusion from gross income of interest on the Bonds.
(k) Yield Restrictions. Any amounts on deposit in any fund or account established
for the Bonds will not be invested at a yield which exceeds the Bond Yield, except as follows:
(1) Accrued Interest. Amounts ~leposited in the Bond Fund to pay
Pre-Issuance Accrued Interest and the investment earnings thereon, may be invested without
regard to yield restrictions, and are not subject to the Rebate Requirement.
fi~renton\ltgo 06 6
(2) Bond Fund. Amounts deposited in the Bond Fund may be invested at an
unrestricted yield for a period of 13 months from the date of deposit of such amounts in the Bond
Fund. Earnings on such amounts that are retained in such funds may be invested at an
unrestricted yield for a period of 13 months from the date of receipt of the amount earned. Such
amounts are not subject to the Rebate Requirement.
(3) Piqiect Fund. Sale Proceeds of the Bonds on deposit in the Project Fund,
together with the investment earnings thereon, may be invested without regard to yield
restrictions for a three-year period commencing on the date hereof. Thereafter, such funds may
not be invested in Nonpurpose Investments at a yield that exceeds the Bond Yield. Except as
otherwise described in Section 4 hereof, such funds will be subject to the Rebate Requirement.
(4) Investment Earnings. All earnings on Gross Proceeds, other than earnings
on amounts described in Section 3(k)(2) hereof and earnings on Replacement Proceeds that do
not themselves constitute Replacement Proceeds, are subject to the Rebate Requirement.
(5) Yield Reduction Pavrnents. Notwithstanding any of the provisions of
Sections 3 (k)(1) throu~h 3 (k)(4) hereof that require the investment of sale proceeds of the Bonds
and investment earnings thereon at a yield not in excess of the Bond Yield, the yield on certain
Nonpurpose Investments acquired with proceeds of the Bonds will not be considered to be hi~er
than the applicable yield limitation described in this Section 3(k) if the City makes or causes to
be made "yield reduction payments" to the United States Treasury at the times and in the
amounts described in Section 1.148-5(c) of the Treasury Regulations. The City agrees to retain
and consult with Bond Counsel prior to making any "yield reduction payments" pursuant to
Section 1.148-5(c) of the Treasury Regulations.
(1) No Oualified Hed.~e~. The City has not identified, nor does it expect to identify,
any hed~ng arrangement or transaction as a "qualified hedge" (as defined in Treasury
Regulations Section 1.148-4(h)) with respect to the Bonds.
(m) No Hedge Bonds. At least 85% of the spendable proceeds of the Bonds will be
used to carry out the governmental purposes of the Bonds by August 7, 2009, and not more than
50% of the proceeds of the Bonds will be invested in Nonpurpose Investments with a
substantially guaranteed yield of 4 years or more.
(n) Single Issue. No other obligations of the City (1) are reasonably expected to be
paid from substantially the same source of funds as the Bonds (determined without regard to
guarantees from unrelated parties), (2) are being sold at substantially the same time as the Bonds,
(i.e., within fourteen days of August 8, 2006, the sale date of the Bonds), and (3) are being sold
pursuant to the same plan of financing as the Bonds.
Section 4. Rebate Requirement Calcu’latioris and Payment. The City has been advised by
Bond Counsel that the following provisions and procedures also apply to the proceeds of the
Bonds.
f:h-enton\ltgo 06 7
(a) General. Certain Gross Proceeds of the Bonds will be exempt from the Rebate
Requirement described in Section 4(e) hereof if the Bonds satisfy the requirements of Section
4(b), Section 4(c) or Section 4(d) hereof.
(b) Six Month Exception. The Bonds shall be treated as meeting the Rebate
Requirement described in Section 4(e) hereof if the Gross Proceeds thereof are expended for the
governmental purposes df such issue within the 6 month period beginning on the Date of Issue;
provided, that the 6 month spending period will be extended for an additiona! 6 months if the
Gross Proceeds of the Bonds, as specially defined for purposes of this Section 4(b), are expended
within the first six-month spending period except for an amount not exceeding the lesser of 5%
of the issue price of the Bonds, or $100,000. For purposes of this Section 4(b), the governmental
purposes of the Bonds include (1) payments of interest on but not payments of principal of the
Bonds, and (2) payments of interest on or principal of other obligations of the City. For this
purpose, Gross Proceeds has the meaning set forth in Exhibit A to this Nonarbitrage Certificate,
except that it does not include (A) amounts held in a bonafide debt service fund, (B) amounts
held in a reasonably required reserve or replacement fund, (C) amounts that, as of the Date of
Issue, are not reasonably expected to be Gross Proceeds, but that become Gross Proceeds after
the end of the six-month period, (D) amounts representing sale or investment proceeds derived
from payments under any Purpose Investment of the Bonds, and (E) amounts representing
repayments of grants financed by the Bonds. Notwithstanding the above, Gross Proceeds of the
Bonds shall not be eligible for the exemption from the Rebate Requirement described in this
Section 4(b) unless the Rebate Requirement set forth in Section 4(e) is met for Gross Proceeds of
such issues not required to be spent within the six-month spending period. In the event that the
Bonds satisfy the requirements of this Section 4(b), the City may nevertheless subsequently elect
to disregard the availability of the exemption from rebate described in this Section 4(b) and to
satisfy the Rebate Requirement with respect to the Bonds.
(c) Ei,~_hteen Month Exception. The Rebate Requirement described in Section 4(e)
hereof shall not apply to the Gross Proceeds of the Bonds if the following percentages (the
"Qualifying Expenditures") of such Gross Proceeds are expended for the governmental purposes
of the Bonds by the last day of each of the periods identified below (the "Qualifying Dates").
For this purpose, the governmental purposes of the Bonds include (1) payments of interest on but
no payments of principal of the Bonds, (2) payments of interest on other obligations of the City,
which interest either (A) accrues on such other obligations during a one-year period including the
Date of Issue (B) is a capital expenditure as defined in Treasury Regulations Section 1.150-1Co),
or (C) is a de minimis working capital expenditure, and (3) payments of issuance costs of the
Bonds made from earnings on Gross Proceeds. For this purpose, Gross Proceeds has the
meaning set forth in Exhibit A hereto, except that it does not include (A) amounts held in a bona
fide debt service fund, (B) amounts held in a reasonably required reserve or replacement fund,
(C) amounts that, as of the Date of Issue, are not reasonably expected to be Gross Proceeds, but
that become Gross Proceeds after the end of the eighteen-month period, ~) amounts
representing sale or investment proceeds deri’~ed from payments under any Purpose Investment
of the Bonds; and (E) amounts representing repayments of any grants financed by the Bonds.
f:krenton\ltgo 06 8
Required Percentage Expenditure
of Gross Proceeds Qualifsdng Date
15%February 7, 2007
60%August 7, 2007
100%February 7, 2008
The Qualifying Expenditures as of the last of the Qualifying Dates set forth above will be treated
as made if, as of the third such date, all such Gross Proceeds have been spent for the
governmental purposes of the Bonds, except for a reasonable retainage not exceeding 5% of the
Net Sale Proceeds as of such date, and 100% of the Gross Proceeds are actually spent for the
governmental purposes of the Bonds within the 30-month period beginning on the Date of Issue.
A failure to satisfy the final spending requirement will be disregarded if the City exercises due
diligence to complete the Project and the amount of the failure does not exceed the lesser of 3%
of the issue price of the Bonds or $250,000. For purposes of determining whether the above
Qualifying Expenditures have been made as of the first two Qualifying Dates, earnings
reasonably expected as of the Date of Issue to be generated for the entire 18 month spending
period shall be included; however, for purposes of determining whether the Qualifying
Expenditures have been made as of the third and any subsequent Qualifying Dates, only
investment earnings actually generated as of such date shall be included. In the event any of the
Qualifying Expenditures are not made as and when required, all Gross Proceeds of the Bonds
shall be subject to the Rebate Requirement.
(d) Two Year Exception.. Because the City reasonably expects that at least 75% of
the Available Construction Proceeds of the Bonds will be expended for Construction
Expenditures with respect to property reasonably expected to be owned by a governmental unit,
the Rebate Requirement described in Section 4(e) hereof shall not apply to the Available
Construction Proceeds of the Bonds or the Gross Proceeds of the Bonds used to pay Issuance
Costs if(l) all of the Gross Proceeds of the Bonds to be used to pay Issuance Costs are expended
by the fourth Measuring Date (as defined below), and (2) the following percentages (the
"Required Expenditures") of such Available Construction Proceeds are expended for the
governmental purposes of the Bonds by the last day of each of the periods identified below (the
"Measuring Dates"). For this purpose, the governmental purposes of the Bonds include (A)
payments of interest on but no payments of principal of the Bonds, and 03) payments of interest
on or principal of other obligations of the City, and (C) payments of issuance costs of the Bonds
made from earnings on Gross Proceeds.
Required Percentage Expenditure
of Available Construction Proceeds Measuring Date
10%February 7, 2007
45%~-August 7, 2007
75%February 7, 2008
100%August 7, 2008
f:’xrenton~ttgo 06 9
The Required Expenditures as of the last of the Measuring Dates set forth above will be treated
as made if, as of the fourth such date, all such Available Construction Proceeds have been spent
for the governmental purposes of the Bonds, except for a reasonable retainage not exceeding 5 %
of the Available Construction Proceeds as of such date, and 100% of the Available Construction~
Proceeds are actually spent for the governmental purposes of the Bonds within the three-year
period beginning on the Date of Issue. A failure to satisfy the final spending requirement will be
disregarded if the City ez~ercises due diligence to complete the Proj ect and the amount of the
failure does not exceed the lesser of 3% of the issue price of the Bonds or $250,000. For
purposes of determining whether the above Required Expenditures have been made as of the first
three Measuring Dates, Available Construction Proceeds shall include earnings reasonably
expected as of the Date of Issue to be generated for the entire two-year spending period;
however, for purposes of determining whether the Required Expenditures have been made as of
the fourth and any subsequent Measuring Dates, only investment earnings actually generated as
of such date shall be included. In the event any of the Measuring Expenditures are not made as
and when required, all Gross Proceeds of the Bonds shall be subject to the Rebate Requirement.
(e) Rebate Requirement. The Rebate Requirement as of any Computation Date,
subject to such modifications as may be made by Treasury Regulations or rulings, is an amount
equal to the excess (if any) of the future value of all Nonpurpose Receipts over the furore value
of all Nonpurpose Payments. Al! future values are computed as of the Computation Date using
an interest rate equal to the Bond Yield.
(f) Future Value. The future value of a Nonpurpose Receipt or Payment is calculated
using the following formula:
FV = PV (1 + i)n
where
FV =The future value of the Nonpurpose Receipt or Payment;
PV =The amount of the Nonpurpose Receipt or Payment;
i =Bond Yield divided by the number of compounding intervals in a Bond
Year; and
n = The nmr~ber of compounding intervals from the date of the Nonpurpose
Receipt or Payment through the Computation Date.
(g) Allocation and Accounting Rules. Generally, investments are allocated to the
Bonds for the period that (1) begins on the date Gross Proceeds are al!ocated to the Bonds and to
the investment, and (2) ends on the date suchGr0ss Proceeds cease to be allocated to the Bonds~
or to the investment.
(h) Relationship to Yield Restriction. Subject to Section 3(k)(2) and the next
paragraph hereof, the requirements of this Section 4 relating to the Rebate Requirement of the
Code apply to all Gross Proceeds, regardless;ofwh’ether such amounts are subject to yield
restriction or are unrestricted as to yield. Thus, an amount of Gross Proceeds may be
"unrestricted as to yield" but will, notwithstanding that characterization, be subject to the Rebate
Requirement of the Code. Similarly, an amount of Gross Proceeds may be "restricted as to
f:krenton\ltgo 06 10
yield" but will, notwithstanding that characterization, also be subject to the Rebate Requirement
of the Code.
Because the average annual debt service on the Bonds is less than $2,500,000, the
amounts in the Bond Fund and the earnings thereon are excluded from the calculation of the
Rebate Requirement. The City shall comply with the recordkeeping requirements set forth in
Section 4(k) of this Certificate with respect to such earnings.
(i) Computation and Payrnent Dates. Except as otherwise provided in Section 4(b)
hereof, the Rebate Requirement, net of the Computation Date Credit, must be computed by the
City as of each Installment Computation Date and as of the Final Computation Date. Rebate
Payments of an amount which, when added to the future value of all previous rebate payments
made with respect to the Bonds, equals at least 90% of the Rebate Requirement, must be paid by
the City no later than the date 60 days after each Installment Computation Date. The final
Rebate Payment of an amount which, when added to the future value of all previous rebate
payments made with respect to the Bonds, equals 100% of the Rebate Requirement as of the
Final Computation Date, must be paid by the City to the Department of Treasury no later than 60
days after the Final Computation Date.
(j) Procedure for Remittance. Each payment to be made by the City pursuant to this
Section shall be filed with the Internal Revenue Service, 1160 West 1200 South, Ogden, Utah
84201 (or at such other address as may be designated by the Internal Revenue Service in the
furore) on or before the date payment is due, and shall be accompanied by Internal Revenue
Service Form 8038-G, which shall be executed by the City.
(k)Recordkeeping Obligation.
(1) In General. The Code requires that the City keep and maintain accurate
and complete records of fund balances, any investments thereof and all transactions involving
any Fund or Account held under the Bond Ordinance.
(2) Retention of Records. The Code further requires that the City retain
records of the determination of the Rebate Amounts and of the Rebate Payments actually made
until seven years of the retirement of the last obligation on the Bonds. These records shall
include, but are not necessarily limited to, the following information with respect to Nonpurpose
Investments of Gross Proceeds of the Bonds:
separately);
Purchase price (including the amount of accrued interest stated
(B)Nominal rate of interest;
(C)Par or face amount;
(D)Purchase date;
fi\renton\ltgo 06 1 !
(E)Maturity date;
(F)Amount or original discount or premium (if any);
(G)General type of Nonpurpose Investment;
receipts);
(i)
Frequency of periodic payments (and actual dates and amounts of
PeriOd of compounding;
(J) Date of disposition;
(K) Amount realized on disposition (including the amount of accrued
interest stated separately);
(L) Transaction costs (e.g., commissions) incurred in acquiring,
carrying or disposing of the Nonpurpose Investments; and
(M) Market price data sufficient to establish that the purchase price (or
disposition price) was not greater than (or less than) the arm’s-lengh fair market
value on the date of acquisition (or disposition) or, if earlier, on the date of a
binding contract to acquire (or dispose of) the Nonpm~ose Investment.
Section 5. Se~egation of Proceeds. In order to perform the calculations required by the
Code, it is necessary to separately account for all of the Gross Proceeds and each specific
investment acquired therewith. To that end, the City may take appropriate accounting measures
in order to account fully and with specificity for all Gross Proceeds and each investment
acquired therewith.
Section 6. Bond Ordinance Covenants Concerning Arbitrage and Tax Exemption.
Section 15 of the Bond Ordinance provides as follows:
The City covenants that it will not take or permit to be taken on its behalf
any action that would adversely affect the exclusion of the interest on the Bonds
from the gross income for purposes of federal income taxation, and will take or
require to be taken such acts as may be permitted by Washin~on law and as may
from time to time be required under applicable law to continue the exclusion of
the interest on the Bonds from the gross income for purposes of federal income
taxation. Without limiting the generality of the foregoing, the City will not invest
or make or permit any use of the proceeds of the Bonds or of its other money at
any time during the term of the Bondf-whic-h would cause the Bonds to be
°’arbitrage bonds" within the meaning of Section 148 of the Code.
The City covenants that it shall calculate or cause to be calculated, and
shall rebate to the United States, all earnings from the investment of Bond
f:krenton\ltgo 06 12
proceeds that are in excess of the amount that would have been earned had the
yield on such investments been equal to the yield on the Bonds, plus income
derived from such excess earnings, to the extent and in the manner required by
Section 148 of the Code.
The City has not been notified of any listing or proposed listing by the
Internal Revenud Service to the effect that the City is a bond issuer the arbitrage
certifications of which may not be relied upon.
The City will take no actions and will make no use of the proceeds of the
Bonds or any other funds held under this Ordinance which would cause any Bond
to be treated as a "private activity bond" (as defined in Section 141(b) of the
Code) subject to treatment under said Section 141(b) as an obligation not
described in Section 103(a) of the Code, unless the tax exemption thereof is not
affected.
Section 7. Amendments. Notwithstanding any other provision herein, the covenants and
obligations contained herein may be and shall be deemed modified to the extent the City secures
a written opinion of Bond Counsel that any action required hereunder is no longer required or
that some further action is required in order to maintain the exclusion of interest on the Bonds
from gross income for purposes of federal income taxation.
Section 8. Supplementation of this Certificate. The City understands the need to
supplement this Certificate periodically to reflect further developments in the federal income tax
laws governing the exclusion from gross income for federal income tax purposes of interest on
the Bonds. The City will comply with any modifications or supplements made to this Certificate
in accordance with the written advice of Bond Counsel.
f:~renton\ltgo 06 13
Section 9. Reliance by Bond Counsel. The City understands and acknowledges that the
opinion of Gottlieb, Fisher & Andrews, PLLC, as Bond Counsel, regarding the exclusion of
interest on the Bonds from gross income for federal income tax purposes is rendered in reliance
upon the representations and statements of fact, estimates and expectation contained in this
Certificate and assumes the continued compliance by the City with its covenants described
above, and with the provisions of this Certificate.
IN WITNESS WHEREOF, I have hereunto subscribed my official signature as of the 8th
day of August, 2006.
MICHAEL E. BAILEY ~
Finance and Information Services Administrator
City of Renton, Washington
f:~renton\ltgo 06 14
EXHIBIT A
Definitions
Available Construction Proceeds means the amount equal to the sum of the issue price
of the Bonds, earnings oh such issue price, and earnings on all of the foregoing earnings, less the
amount of the issuance costs financed by the Bonds (including the premium for the Bond
Insurance Policy).
Bond Counsel means Gottlieb, Fisher & Andrews, PLLC.
Bond Year means each 1-year period that ends on a day selected by the City. The first
and last Bond Years may be short periods. If no day is selected by the City before the earlier of
the final maturity date or the date that is 5 years after the Date of Issue, Bond Years end on each
anniversary of the Date of Issue and on the final maturity date.
Computation Date means an Installment Computation Date or the Final Computation
Date.
Computation Date Credit means, with respect to the Bonds on an eligible Computation
Date, a credit of $1,000 on the last day of each Bond Year during which there are amounts
allocated to Gross Proceeds of the Bonds that are subject to the Rebate Requirement, and on the
final maturity date.
Construction Expenditures means capital expenditures (i.e., costs of a type that are
properly chargeable to a capital account, or that would be so chargeable with a proper etection
under general federal income tax principles) that are allocable to the costs of real property or
constructive personal property, excluding expenditures for acquisitions of interests in land or
other existing real property.
Date of Issue means August 8, 2006.
Department of the Treasury means the Department of the Treasury of the United
States.
Fair Market Value, with respect to a Nonpurpose Investment, means, except where
otherwise indicated in this Certificate, the following:
General. Except with respect to Investment Property that is an obligation of the
United States Treasury, the fair market value of an investment means the price at which a
willing buyer would purchase the inv~stme}lt from a willing seller in a bona fide, arm’s
tengh transaction. The fair market value of an Investment consisting of an obligation of
the United States Treasury that is purchased directly from the United States Treasury
shall be its purchase price.
f:~enton\ltgo 06 A- 1
Certificates of Deposit. The market price of a certificate of deposit issued by a
commercial bank that has a fixed interest rate, a fixed principal payment schedule, a fixed
maturity, and a substantial penalty for early withdrawal means its purchase price if the
certificate of deposit has a yield not less than (A) the yield on reasonably comparable
direct obligations of the United States, and (B) the highest yield that is published or posed
by the provider to be currently available from the provider on comparable certificates of
deposit offered td the public.
Guaranteed Investment Contracts. Except as provided in the definitions of
Nonpurpose Payments and Nonpurpose Receipts, in the case of a guaranteed investment
contract, the obligations acquired thereunder shall be considered acquired or disposed of
for an amount equal to the fair market value of such obligations if all of the following
requirements are satisfied:
(A) The issuer makes a bonafide solicitation for the purchase of the
investment. A bonafide solicitation is a solicitation that satisfies a!l of the following
requirements:
(1) The bid specifications are in writing and are timely
forwarded to potential providers.
(2) The bid specifications include all material terms of the bid.
A term is material if it may directly or indirectly affect the yield or the cost of the
investment.
(3) The bid specifications include a statement notify~g
potential providers that submission of a bid is a representation that the potential provider
did not consult with any other potential provider about its bid, that the bid was
determined without regard to any other formal agreement that the potential provider has
w~th the issuer or any other person (whether or not in connection with the bond issue),
and that the bid is not being submitted solely as a courtesy to the issuer or any other
person for purposes of satisfying the requirements of paragraph (B)(1) or (B)(2) of this
definition.
(4) The terms of the bid specifications are commercially
reasonable. A term is commercia!ly reasonable if there is a legitimate business purpose
for the term other than to increase the purchase price or reduce the yield of the
investment.
(5) The terms of the solicitation take into account the issuer’s
reasonably expected deposit and drawdown schedule for the amounts to be invested.
(6) All potential providers have an equal opportunity to bid.
For example, no potential provider is given the opportunity to review other bids (i.e., at
last look) before providing a bid.
f:\renton\ltgo 06 A-2
(7) At least three reasonably competitive providers are
solicited for bids. A reasonably competitive provider is a provider that has an established
industry reputation as a competitive provider of the type of investments being purchased.
(B) The bids received by the issuer meet all of the following requirements:
(1) The issuer receives at least three bids from the providers
that the issuer solicited under a bona.fide solicitation meeting the requirements of
paragraph (A) of this definition and that do not have a material financial interest in the
issue. A lead underwriter in a negotiated underwriting transaction is deemed to have a
material fmancial interest in the issue until 15 days after the issue date of the issue. In
addition, any entity acting as a financial advisor with respect to the purchase of the
investment at the time the bid specifications are forwarded to potential providers has a
material financial interest in the issue. A provider that is a related party to a provider that
has a material financial interest in the issue is deemed to have a material financial interest
in the issue.
(2) At least one of the three bids described in paragraph ~)(1)
of this definition is from a reasonably competitive provider, with the meaning of the
paragraph (A)(7) of this definition.
(3) If the issuer uses an agent to conduct the bidding process,
the agent did not bid to provide the investment.
(C) The winning bid is the highest yielding bona.fide bid (determined
net of any broker’s fees).
(D) The obligor on the guaranteed investment contract certifies the
administrative costs that it pays (or expects to pay, if any) to third parties in connection
with supplying the investment.
(E) The issuer retains the following records with the bond documents
until three years after the last outstanding bond is redeemed:
(1)A copy of the contract.
(2)The receipt .or other record of the amount actually paid by
the issuer for the investments, including records of any administrative costs paid by the
issuer, and the certification under paragraph (D) of this definition.
(3) For each bid that is submitted, the name of the person and
entity submitting the bid, the time and;date’of the bid, and the bid results.
(4) The bid solicitation form and, if the terms of the guaranteed
investment contract deviated from the bid solicitation form or a submitted bid is
modified, a brief statement explaining the deviation and stating the purpose for the
f:~renton~ltgo 06 A-3
deviation. For example, if the issuer purchases a portfolio of investments for a yield
restricted defeasance escrow and, in order to satisfy the yield restriction requirements of
section 148, an investment in the winning bid is replaced with an investment with a lower
yield, the issuer must retain a record of the substitution and how the price of the
substitute investment was determined. If the issuer replaces an investment in the winning
bid portfolio with another investment, the purchase price of the new investment is not
covered by the s~fe harbor unless the investment is bid under a bidding procedure
meeting the requirements of this definition.
Final Computation Date means the date the last Bond is discharged.
Gross Proceeds shall have the meaning contained in Treasury Regulations
Section 1. !48-1(b), and shall generally include amounts which are:
(a) Actually or constructively received from the sale of the Bonds, including
amounts used to pay underwriters’ discount or compensation and accrued interest other
than Pre-Issuance Accrued Interest;
(b) Investment proceeds (defined in Treasury Regulations Section 1.148-1(b)
to include amounts actually or constructively received at any time by the City, such as
interest and dividends, from the investment of proceeds of the Bonds);
(c) Treated as proceeds under Treasury Regulations Section 1.148-1(c) (which
treats amounts in invested sinking funds and pledged funds for an issue as proceeds of an
issue), including amounts in the Local Improvement Fund for the purpose of paying debt
service on the Bonds;
(d) Inve.sted in a reasonably required reserve or replacement fund (as defined
in Treasury Regulations Section 1.148-2(f));
(e)Pledged by the City as security for payment of debt service on the Bonds;
or
(f)Used to pay debt service on the Bonds.
Such term shall not include amounts that are not otherwise Gross Proceeds but that are allocated
to the Rebate Requirement. The determination of whether an amount is included within this
defirfition shall be made without regard to whether the amount is credited to any fund or account
established under the Bond Ordinance. For purposes of (e) above, an amount is pledged to pay
principal of or interest on the Bonds if there is reasonable assurance that the amount will be
available to be used for such purposes in the event that the City encounters financial difficulties.
Installment Computation Date means the last day of the fifth Bond Year and each
succeeding fifth Bond Year.
f:krenton\ltgo 06 A-4
Investment Property means any security or obligation (other than tax exempt
obligations that are not "specified private activity bonds" within the meaning of
Section 57(a)(5)(C) of the Code or a tax-exempt mutual fund that invests in tax-exempt bonds
other than specified private activity bonds), any annuity contract or any other investment type
property.
Investment-type Property means any property, other than property described in
Section 148(b)(2)(A), (B), (C), or (E) of the Code, that is held principally as a passive vehicle for
the production of income. Except as otherwise provided, a prepayment for property or services
is investment-type property if a principal purpose for prepaying is to receive an investment return
from the time the prepayment is made until the time payment otherwise would be made. A
prepayment is not investment-type property if:
(a) The prepayment is made for a substantial business purpose other than "
investment return and the plan has no commercially reasonable alternative to the
prepayment, or
(b) Prepayments on substantially the same terms are made by a substantial
percentage of persons who are similarly situated to the City but who are not beneficiaries
of tax-exempt financing.
Nonpurpose Investment means any Investment Property in which Gross Proceeds are
invested or to which Gross Proceeds are allocated other than purpose investments. Nonpurpose
Investments shall not include:
(a) United States Treasury Demand Deposit Securities -- State and Local
Government Series; and
(b) Tax Exempt Obligations.
For purposes of this Certificate, the term "Tax-Exempt Obligations" shall include only
obligations the interest on which is (i) excluded from gross income for federal income tax
purposes, and (ii) not treated as an item of tax preference under Section 57(a)(5) of the Code.
The term "Tax-Exempt Obligation" shall, however, include an interest in a regulated investment
company (within the meaning of Section 851(a) of the Code) to the extent that at least 95% of
the income to the holder is interest that is excluded from gross income by Section 103(a) of the
Code.
Nonpurpose Payments mean: (a) amounts actually or constructively paid to acquire a
Nonpurpose Investment (or treated as paid to acquire a Nonpurpose Investment in a Commingled
Fund), (b) for a Nonpurpose Investment that is first allocated to the Bonds on a date after it is
actually acquired (e.g., an investment that bedomes- allocable to Transferred Proceeds or to
Replacement Proceeds) or that become subject to the Rebate Requirement on a date after it is
actually acquired, the Value of that investment on that date, (c) for a Nonpurpose Investment that
was allocated to the Bonds at the end of the preceding computation period, the Value of that
f:q’enton~ltgo 06 A-5
investment at the beginning of the computation period, (d) the Computation Date Credit, and
(e) yield reduction payments as described in Section 3(k)(5) hereof.
Nonpurpose Receipts mean: (a) amounts actually or constructively received from a
Nonpurpose Investment, (including amounts treated as received from Nonpurpose Investments
held by a Commingled Fund), such as earnings and return of principal, (b) or a Nonpurpose
Investment that ceases td be allocated to an issue before its disposition or redemption date (e.g.,
an investment that become allocable to Transferred Proceeds of another issue) or that ceases to
be subject to the Rebate Requirement on a date earlier than its disposition or redemption date
(e.g., an Investment allocated to a fund initially subject to the Rebate Requirement but that
subsequently qualifies as a bona fide debt service fund), the Value of that Nonpurpose
Investment on that date, and (c) for a Nonpm~ose Investment that is held at the end of a
computation period, the Value of that investment at the end of that period. Treasury Regulations
Section 1.148-6(e) provides special rules for any fund containing both Gross Proceeds of the
Bonds in amounts in excess of $25,000 that are not Gross Proceeds of the Bonds if the amounts
in such fund are invested and accounted for collectively, without regard to the source of funds
deposited in the fund (a "Commingled Fund").
Plain Par Bond means a bond (a) issued with not more than a de minimis amount of
original issue discount or premium, (b) issued for a price that does not include accrued interest
other than Pre-Issuance Accrued Interest, (c) that bears interest from the issue date at a single,
stated, fixed rate or that is a variable rate debt instrument within the meaning of Section 1275 of
the Code, in each case with interest unconditionally payable at least annually, and (d) that has a
lowest stated redemption price that is not less than its outstanding stated principal amount. For
this purpose, a "de minimis" amount means, with reference to original issue discount or
premium, an amount that does not exceed 2% multiplied by the stated redemption price at
maturity, plus any origina! issue premium that is attributable exclusively to reasonable
underwriters’ compensation.
Plain Par Investment means an investment that is (a) issued with not more than a de
minimis amount of original issue discount or premium or, if acquired on a date other than its
issue date, acquired with no more than a de minimis amount of market discount or premium,
(b) issued for a price that does not include accrued interest other than Pre-Issuance Accrued
Interest, (c) bears interest from its issue date at a single stated, fixed rate or that is a variable rate
debt instrument, in each case with interest unconditionally payable at least annually, and (d) has
a lowest stated redemption price that is not less than its outstanding stated principal amount. For
this purpose, de minimis shall mean, with reference to origi_nal issue discount or premium, an
amount that does not exceed 2% multiplied by the stated redemption price at maturity plus any
oriNnal issue premium that is attributable exclusively to reasonable underwriters’ compensation
and, in reference to market discount or market premium, an amount that does not exceed 2%
multiplied by the stated redemption price at maturity.
.;
Pre-Issuance Accrued Interest means amounts representing interest that accrued on the
Bonds for a period not greater than one year before the Date of Issue, but only if these amounts
are paid within one year after the Date of Issue.
f:\renton\ltgo 06 A-6
Present Value means, with respect to an investment, an amount equal to the Present
Value of all unconditionally payable receipts to be received from and payments to be paid for the
investment after that date using the yield on the investment as the discount rate, computed under
the economic accrual method, using the same compounding interval and financial conventions
used to compute the Bond Yield.
Rebate Requirement shall have the meaning ascribed thereto in Section 4(e) of this
Certificate.
Replacement Proceeds means amounts that have a sufficiently direct nexus to the Bonds
or to the governmental purpose of the Bonds to conclude that the amounts would have been used
for that governmental purpose if the proceeds of the Bonds were not used or to be used for that
governmental purpose. For this purpose, governmental purposes include the use of amounts for
the payment of debt service on a particular date. Replacement Proceeds include, but are not
limited to, sinking funds, pledge funds, and certain other amounts to the extent these funds or
amounts are held by or derived from a substantial beneficiary of the Bonds.
Sale Proceeds means any amounts actually or constructively received from the sale of
the Bonds, excluding amounts used to pay Pre-Issuance Accrued Interest.
Treasury Regulations means regulations issued by the United States Treasury pursuant
to Sections 103 and 141 through 150 of the Code.
Value means, with respect to an investment (including a payment or receipt on an
investment) on a date, an amount determined consistently using one of the following methods
with respect to such investment for all purposes of Section 148 of the Code: (a) with respect to a
Plain Par Investment, its outstanding stated principal amount, plus any accrued interest unpaid on
that date, (b) any fixed rate investment may be valued at its Present Value on that date, and
(c) any investment may be valued at its Fair Market Value on that date. Any yield-restricted
investment must be valued at its Present Value. Except with regard to (i) yield-restricted
investments, and (ii) investments allocated or de-allocated as a result of application of the
Universal Cap, or (iii) amounts in a Commingled Fund, an investment must be valued at its Fair
Market Value on the date that it is first allocated to the Bonds or first ceases to be allocated to the
Bonds as a consequence of a deemed acquisition or deemed disposition.
fArenton\ltgo 06 A-7
Capital Strength. Triple-A Performance. TAX CERTIFICATE
City of Renton, Washington
1055 South Grady
Renton, Washington 98058
MBIA Insurance Corporation
113 King Street, Armonk, NY 10504
Tel 914-273-4545
www.mbia.com
$17,980,000 City of Renton, Washington, Limited Tax General Obligation Bonds, 2006
(the" Obligations")
Ladies and Gentlemen:
tn connection with the issuance of the above-referenced obligations (the "Obligations"),
MBIA Insurance Corporation (the "Insurer") is issuing a financial guaranty insurance policy (the
"Policy") securing the payment of principal and interest on the Obligations.
This is to advise you that:
!. The Policy is an unconditional obligation of the Insurer to pay scheduled payments of
principal and interest on the Obligations in the event of a failure to do so by the City of Renton,
Washington (the "Issuer");
2. The insurance premium in the amount of $49,000 for the Policy, represents the charge for a
transfer of credit risk and was determined in arm’s len~h negotiations and is required to be paid
as a condition to the issuance of the Policy;
3. No portion of such premium represents an indirect payment of costs related to the issuance
of the Obligations other than for the transfer of credit risk;
4. The Insurer does not reasonably expect that it will be called upon to make any payment
under the Policy; and
5. To the extent the Insurer is called upon to make any payment trader the Policy, the Insurer
reasonably expects to pursue all available legal remedies to secure reimbursement for such
payment
Dated: August 8, 2006
MBIA Insurance Corporation
UNDERWRITER’S CERTWICATE
We, D.A. DAVIDSON & CO., as underwriter of the $17,980,000 CITY OF RENTON,
WASHINGTON, LIMITED TAX GENERAL OBLIGATION BONDS, 2006 (the "Bonds"),
hereby certify that:
1. Capitalized terms used but not defined herein shall have the meanings set forth in
Ordinance No. 5215 (the "Bond Ordinance") of the City of Renton (the "City").
2. A substantial amount (i.e., at least 10% of each maturity) of the Bonds was sold to
members of the public (excluding bond houses, brokers and other intermediaries) in an initial
bonafide public offering, at prices no higher than the prices for the Bonds set forth on the cover
page of the Official Statement pertaining to the Bonds (the "Official Statement"), dated July 17,
2006.
3. In our judgment, the premium to be paid to MBIA Insurance Corporation for the
financial guaranty insurance policy for the Bonds (the "Insurance Policy") (a) was negotiated at
arm’s len~h and is reasonable, and (b) the present value of such premium (computed by using
the yield-to-maturity on the Bonds, including such premium, as the discount factor) is less than
the present value of the interest reasonably expected to be saved on the Bonds as a result of the
purchase of the Insurance Policy.
4.The weighted average maturity of the Bonds is 14.061 years.
5. The yield on the Bonds, computed on the basis of the initial offering prices for the
Bonds set forth on the cover pages of the Official Statement, is 4.5878116%.
6. The City and Gottlieb, Fisher & Andrews, PLLC, as Bond Counsel, may each rely
upon the foregoing representations.
DATED as of the 8th day of August, 2006.
D.A. DAVIDSON & CO.
By
FRED R. EOFF
ManaNng Director
f:krenton\ltgo 06
Fo,m 8038-G Information Return for Tax-Exempt Governmental Obligations
~, Under Internal Revenue Code section 149(e)OMB No, 1545-0720
(Rev. November 2000)~- See separate Instructions.
Department. of the Treasury Caution: If the issue price is under $100,000, use Form 8038-GC.Internal Revenue Service If Amended Return, check here ¯I =,~rit | Reporting Authority’
1 Issuer’s name I 2 Issuer’s employer identification number
City of Renton ~ 91 ! 6001271
3 Number and street (or P.O. box if mail is not delivered to sb’eet address)Room/suite/ 4 Report number
1055 South Grady Way "/ 6
3 01 -
5 City, town, or post office, state, and ZIP code Date o1: issue
Renton, Washington 98058 August 8, 2006
7 Name of issue CITY OF RENTON, WASHINGTON, LIMITED TAX GENERAL OBLIGATION
/ 8
CUSIP number
760133 RG5
BONDS, 2006
9 Name and title of officer or legal representative whom the IRS may call for more information 110 Telephone number of officer or legal representative
Michael E. Bailey, Finance and Information Services Administrator1 ( 425 ) 430-6858
I~’Ti!ll Type of Issue (check applicable box(es) and enter the issue price) See instructions and attach schedule
111
11 [] Education ...........................121
2 LJ Health and hospital .......................13 18,640,506.35
3 [] Transportation .........................14
i4 [] Public safety ..........................15
15 [] Environment (including sewage bonds) ............... ¯ . ¯16
16 [] Housing .......17
17 [] Utilities ..............................18
18 [] Other. Describe ¯
19 If obligations are TANs or RANs, check box ¯ [] If obligations are BANs, check box ¯ I--}’
~.0 If obligations are in the form of a lease or installment sale, check box ......¯ []
~riillll Description of Obligations. Complete for the entire issue for which this form is bein,q filed.
(a) Final maturity date (b) Issue price (c) Statedprice atredempti°nmaturity average(d) Weightedmaturity (e) Yield
Zl 12!1/2028 $18,640,506.35. $17,980,000.00 14.061 ),ears 4.5878116 %
|’~mLVl Uses of Proceeds of Bond Issue (including underwriters’ discount)17,174.50
22 Proceeds used for accrued interest ...................23 I 18,640,506.35
23 Issue price of entire issue (enter amount from ne 21, column (b)) ...........
24 Proceeds used for bond issuance costs (incud ng underwriters’ discount) . 24
176,352.13
25 Proceeds used for credit enhancement . . . .........! 25 I 49,000.00
26 Proceeds allocated to reasonably required reserve or replacement fund . ¯ l 26
27 Proceeds used to current y refund prior issues ........./ 27 I
28 Proceeds used to advance refund prior issues .........! 28 225,352.13
29 Total (add lines 24 through 28) .......................
30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here)30 I 18,415,154.22
|’~ilfl Description of Refunded Bonds (Complete this part only for refunding bonds.)
31 Enter the remaining weighted average maturity of the bonds to be currently refunded . ¯year~
32 Enter the remaining weighted average maturity of the bonds to be advance refunded . ¯years
33 Enter the last date on which the refunded bonds will be called ..........¯
34 Enter the date(s) the refunded bonds were issued ¯
I~ri~lll Miscellaneous
35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5)t~,.~_
36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (see instructions)I"~ea
b Enter the final maturity date of the guaranteed investment contract ¯
37 Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units
b If this issue is a loan made from the proceeds of another tax-exempt issue, check box ¯ [] and enter the name of the
issuer ¯:- and the date of the issue ¯
38 If the issuer has designated the issue under section 265-(b)(3)(B)(i)(lll) (small issuer exception), check box ¯ []
39 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box ..........¯ []
40 If the issuer has identified a hedge, check box .......... ..............¯ []
Under penalties of perjur~, I declare that I have examined this re~urn and accompanying schedules and statements, and to the best of my knowledge
and belief, they are true, correct, and complete,
Sign I~ ~ (-"v~, ~-~ /’~-~ ~~
~ MICHAEL E. BAILEY, Finance and
Here August 8, 2006 Information Services Administrator
¯ Signature o i{ ssuer’s aL~hori2ed representative Date Type or print name and ~itle
For Paperwork Reduction Act Notice, see page 2 of the Instructions. Cat. No. 63773S Form 8038-G (Rev. 11-2000)
AFFIDAVIT OF MAILD,IG
STATE OF WASHINGTON )
COUNTY OF KSNG )
The undersigned, being first duly sworn on oath, deposes and states that on the 18th day
of August, 2006, she caused to be deposited in the U.S. mail, certified mail, return receipt
requested, with postage prepaid, an envelope addressed to:
Internal Revenue Service
!160 West 1200 South
Ogden, Utah 84201
contaiNng the original Form 8038-G regarding the issuance of the following bonds:
$17,980,000
CITY OF RENTON, WASHINGTON
LllVIITED TAX GENERAL OBLIGATION BONDS, 2006
Turtle.
Mary J.
SIGNED AND SWORN TO before me on this 18th day of Auoo’ust, 2006, by Mary J.
(Seal or stamp)Ngtary Signatu
Judith L. Andrews
Notary Public in and for the State of
Washington, residing at Seattle.
My appointment expires /! - ! ~) - d ~
f:~renton\Itgo 06
STATE OF WASHINGTON
DEPARTMENT OF COMMUNITY,
TRADE AND ECONOMIC DEVELOPMENT
g06 Columbia Street SW
P.O. Box 42525
Olympia, WA 98504-2525
Fax: 360/586-4162
360/725-3019
Attn: Bond Users Clearinghouse
BOND REPORT FORM 10"1
Is this a revision of a previously submitted report: Yes [] No []
If yes and the debt issue was listed in the Monthly Update, what was its issue number?
Name of Issuer:
Address of Issuer:
4.
5,
6.
County in which the entity using the bond proceeds is located: !~i:~!!~ !~!~:~., If two to four counties are using the
bond proceeds, type names in the blank field.,~,,,,~,,,,~, , and/or
If more than four, click on "various counties" [] or "all counties" [].
Principal user (if different than issuer)::;: .~
Exact title of bond (or "type of debt" if no title): im!!~:: ~ G~ ~:~ If not listed:
Was the bond issue "voter-approved"? Yes []No []
(a) Par value: Tax-exempt $ ~7,98~ ~ O0
Taxable$ :,:i’:
(b) Net interest cost*: Tax-exemp % ~
Taxable % []
*See instructions for formula. If either or both interest rates are variable rather than fixed, please
check the box(es) to the right of the percentage signs.
Premium:
Dated date of bond:Date of bond sale:
What is the underlying security on which this bond issue is based, such as taxes or other revenue stream(s)
that support the debt? (Please answer the question even if an official statement is enclosed.)
t0.Name of financial advisor:B~i~::~we~ :~Cuilti~
11.Name of bond counsel:~ottii~ #i~ ~ ~
12.Name of lead unde~riter(s):
13.Name of company insuring bond:~!A
14.Name of registrar:~~~
1~.Name of trustee:
If not listed:
If not listed:
If not listed:
If not listed:
If not listed:
If not listed:
16.Purpose of proceeds: (Please answer question even if official statement is enclosed.)
17,
18.
t9.
20,
21.
22,
23.
24.
25,
If official statement is not enclosed, attach maturity schedule including dates, amounts and interest rates.
Bond sale method: Competitive Bids [] Negotiated Sale [] Private Placement [] Other
If it was a competitive sale: how many bids were received?
Express the gross underwriting spread (see instructions for definition). Only leave field blank if there is no fee:
$~ ~ ~. [] Check box if figure is an estimate.
List the fee for bond counsel service (only leave field blank if there is no fee):
[] Check box if the above figure is an estimate.
Indicate other fees and costs associated with bond issuance (not included as part of the costs in questions #20
and 21). Only leave fields blank if there are no fees. Check boxes when figures are estimates.
Legal I Underwriter’s Counsel Fee:$[]
Administrative / Commission Fee:$[]
Feasibility Study:$[]
Rating Agency:$~[]
Trustee:$[]
Credit Enhancement (letters of credit):$[]
Escrow Costs $[]
Financial Advisor:
Bond Insurance:
Adv/Printing/Off Stmt:
Out-of-State Travel:
Misc:
Misc:
Misc:
Was bond rated? If yes, please state the rating given by each agency:
Standard & Poor’s Moody’s Fitch
IMPORTANT: RCW 39.44.210 requires a copy of the bond covenants to be submitted with this report form.
Have you submitted such a copy? Yes [] No []
If not, state the reason and/or your intended submission date.::
Is a copy of the official statement or offering circular available?Yes []No []
If yes, it should be included with this report.
This information has been submitted by:
Name:o.qi
Title: ~i~
Affiliation:
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26,Any additional comments, questions or suggestions?
Last Revised: 9/9/04
~-JOTTLIEB, FISHER {d ANDREWS, PLLC
ATTORNEYS AT LAW
August 8, 2006
Mayor and City Council
City of Renton
Renton, Washington 98055
Ladies and Gentlemen:
We have acted as bond counsel in connection with the issuance by the City of Renton,
Washington (the "City"), of the bonds described below (the "Bonds"):
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
Dated: August 1, 2006
The Bonds are issued pursuant to Ordinance No. 5215 of the City (the "Bond
Ordinance") and other proceedings duly had and taken in conformity therewith. The Bonds are
issued to provide part of the funds necessary to pay the costs of constructing transportation and
utility infrastructure and improvements in the South Lake Washin~on Infrastructure project and
the SW 27th Street Extension project, and to pay incidental costs thereof and the costs related to
the sale and issuance of the Bonds, all as provided in the Bond Ordinance.
The Bonds shall be issued in fully registered form as to both principal and interest; shall
be in the denomination of $5,000 each or any integral multiple thereof within a single maturity.
The Bonds bear interest (computed on the basis of a 360-day year of t~velve 30-day months)
from their date or from the most recent interest payment date to which interest has been paid or
duly provided for, whichever is later, payable December 1, 2006, and semiannually thereafter on
each June 1 and December 1 to the maturity or earlier redemption thereof, at the rates set forth
below, and shall mature on December 1 in each of the years and in the principal amounts set
forth below:
520 Pik~e Street, Suite 2510 Seaetle, WA 98101-4006
(206) 654-1999 Pt~one (206) 654-8725 Fax
Mayor and City Council
City of Renton, Washington
August 8, 2006
Page 2
Maturity Date
(December 1)
Principal
Amount
Interest Rate
Per Annum
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
520,000
540.000
565.000
585.000
610.000
640000
670.000
700000
750 000
775 000
4.25%
4.25
3.90
4.25
5.00
4.50
5.25
5.25
4.30
5.00
2019"1,670,000 5.00
2020
2021
2022
2023
2024
900,000 5.00
945,000 5.00
1,000,000 5.25
1,040,000 5.25
1,095,000 5.25
2028*4,975,000 5.00
*Term Bonds
The Bonds shall be subject to redemption prior to maturity at the times and in the manner
described in the Bond Ordinance. The City has reserved the right to purchase any or all of the
Bonds in the open market at any time and at any price.
In rendering this opinion letter, we have examined the following: (i) the Bond
Ordinance; (ii) a copy of one executed and authenticated Bond (we assume that all other Bonds
are in the same form and have been similarly executed and authenticated); mad (iii) the certified
proceedings of the City and other certificates of public officials and representatives of the City
which have been furnished to us and which comprise the transcript of proceedings pertaining to
the issuance of the Bonds (the "Transcript").
As to questions of fact material to the opinions expressed herein, we have relied upon
the certified proceedings of the City and other certificates of public officials and representatives
of the City which have been furnished to us as part of the Transcript, all without undertaking to
verify the same by independent investigation.
Mayor and City Council
City of Renton, Washington
Auto, st 8, 2006
Page 3
Based only upon the foregoing and our examination of such questions of law as we have
deemed necessary or appropriate for the purpose of this opinion letter, and subject to the
limitations and qualifications expressed below, we are of the opinion that, as of this date:
1. The Bond~ are lawfully authorized and issued pursuant to and in full compliance
with the constitution and statutes of the State and the Bond Ordinance.
2. The Bonds are legal, valid and binding general obligations of the City,
enforceable against the City in accordance with their terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors’ rights, and also to the
exercise of judicial discretion in accordance with general principles of equity.
3. The City has irrevocably covenanted in the Bond Ordinance that, unless the
principal of and interest on the Bonds are paid from other sources, so long as the Bonds are
outstanding, the City shall include in its budgets and make annual levies of taxes within the
constitutional and statutory tax limitations provided by law without a vote of the qualified voters
of the City upon all property within the City subject to taxation in amounts which, together with
any other money legally available therefor, shall be sufficient to pay such principal and interest
on the Bonds as the same shall become due. The City has irrevocably pledged its full faith,
credit and resources to the annual levy and collection of such taxes and for the prompt payment
of such principal and interest.
4. Assuming compliance by the City with applicable requirements of the Internal
Revenue Code of 1986, as amended (the "Code), that must be met subsequent to the issuance of
the Bonds, interest on the Bonds, including any original issue discount properly allocable to an
owner thereof, is excludable from goss income for federal income tax purposes under existing
federal law and is not an item of tax preference for purposes of determining the federal
alternative minimum tax imposed on individuals and corporations under existing federal law.
However, under existing federal law, interest on the Bonds, including any original issue discount
properly allocable to an owner thereof, is taken into account in determining adjusted current
earnings for the purpose of computing the alternative minimum tax imposed on certain
corporations.
Except as stated in the preceding paragaph 4, we express no opinion as to any federal or
state tax consequences of receipt of interest on the Bonds.
The Code contains certain requirements that must be satisfied subsequent to the date of
issuance of the Bonds in order to maintain the exclusion of interest on the Bonds from gross
income for federal income tax purposes, including requirements relating to application of the
proceeds of the Bonds, use of facilities financed with such proceeds, limitations on income
derived from the investment of ~oss proceeds of the Bonds (as defined in Section 148 of the
Code), and rebate to the United States Treasury of certain investment earnings on such gross
proceeds. The City has covenanted to comply with these requirements to the extent applicable,
and the opinion expressed in paragaph 4 assumes such compliance. However, we have not
Mayor and City Council
City of Renton, Washington
August 8, 2006
Page 4
undertaken and do not undertake to monitor compliance by the City with such requirements; and
if the City should fail to comply with such requirements, interest on the Bonds could become
includable in goss income for federal income tax purposes retroactive to the date of issuance of
the Bonds.
We have not been engaged to participate in the preparation or review of, or to express
any opinion concerning the completeness or accuracy of, the official statement or other
disclosure documentation used in connection with the offer or sale of the Bonds, and thus
express no opinion concerning the completeness or accuracy thereof.
Copies of this opinion letter may be delivered to the Owners of the Bonds, who may rely
on this opinion letter as if it were addressed to such Owners on the date hereof. Subject to the
foregoing, this opinion letter may be relied upon by you only in connection with the issuance of
the Bonds and may not be used or relied upon by you or any other person for any other purpose
whatsoever, without in each instance our prior written consent. We expressly disclaim any
responsibility to advise you or any Owners of any developments in areas covered by this opinion
letter that occur after the date hereof.
Respectfully submitted,
GOTTLIEB, FISHER & ANDREWS, PLLC
By /’~ ~~’~~
Judith L. Andrews
Capital Strength. Triple-A Performance.
August 8, 2006
[vlBIA Insurance Corporation
113 King Street, Armonk, NY 10504
Tel 914-273-4545
www.mbia.com
City of Renton, Washington
1055 South Grady
Renton, Washin~on 98058
D.A. Davidson & Co.
Bank of America Tower
701 Fifth Avenue, Suite 3100
Seattle, Washington 98104
$17,980,000
City of Renton, Washington
Limited Tax General Obligation Bonds, 2006
Ladies and Gentlemen:
I am Deputy General Counsel of the MBIA Insurance Corporation, a New York corporation (the
"Corporation"), and have acted as counsel to the corporation in connection with the issuance of
Financial Guaranty Insurance Policy No. 48291 (the "Policy") relating to $17,980,000 City of
Renton, Washin~on, Limited Tax General Obligation Bonds, 2006.
In so acting, i have examined a copy of the Policy and such other relevant documents as I have
deemed necessary.
Based upon the foregoing, I am of the following opinion:
1. The Corporation is a stock insurance corporation, duly incorporated and validly existing
under the laws of the State of New York and is licensed and authorized to issue the Policy
under the laws of the State of New York.
Page 2
2. The Policy has been duly executed and is a valid and binding obligation of the Corporation
enforceable in accordance with its terms except that the enforcement of the Policy may be
limited by laws relating to bankruptcy, insolvency, reorganization, moratorium, receivership and
other similar laws affecting creditors’ rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in equity or at law).
Very truly yours,
Leonard I. Chubinsky
Deputy General Counsel
Bond Closinq and Funds Transfer Memorandum
Final
From: Fred Eoff, D. A. Davidson & Co.
Date: August 2, 2006
Re:City of Renton, Washington
Limited Tax General Obligation Bonds, 2006
This Memorandum summarizes details pertaining to Closing of the transection referenced above.
Closing will be at the offices of Gottlieb Fisher & Andrews in Seattle, Washington on August 8, 2005 at approximately 9:00 PT.
Final closing is expected to occur telephonically upon confirmation of receipt of all wire transfers.
The detail of funds transfers, deposits and disbursements essential to Closing is as follows:
(1) The purchase price by D.A. Davidson of the 2006 Bonds is as follows:
Par Amount of 2006 Bonds S 17,980,000.00
Plus: Reoffering Premium 660,506.35
Plus: Accrued Interest 17,174.50
Less: Underwriters Discount (118,652.13)
18,539,028.72
(2)On the morning of August 8, 2006 D.A Davidson will transfer the purchase price of the 2006 Bonds via two separate wire transfers
as follows:
Wire 1:$49,000.00 To MBIA Insurance Corporation as payment of the bond insurance premium.
Wire 2:
Bank:J.P Morgan Chase Bank
ABA#:021000021
For:MBIA Insurance Corporation
Acct#:910-2-721728
Ref:Policy No. 48291
18,490,028.72 To the City of Renton.
Bank:U.S. Bank
Branch:Renton, Washington
ABA#125000105
For:City of Renton
Acc#:153500698326
Ref:2006 LTGO Bonds
(3) The proceeds received by the City in Wire ,#2, above are allocated as follows:
Construction Fund 18,472,854.22
Bond Fund - accrued interest 17,174.50
$18,490,028.72
Con&3cts:Fred Eoff, D.A. Davidson & Co.
Michael Bailey, City of Renton
Judy Andrews, Gottlieb Fisher & Andrew.,
Lindsay Sovde, Seattle-NW Securities
Randy Leeper, D.A. Davidson & Co.
cellphone
206-903-8680
206-979-1197
425-430-6858
206-654-1999
206-625-2875
402-392-7980
CLOSING MEMORANDUM
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
CLOSING DATE: August 8, 2006
This memorandum outlines the actions taken in connection with the issuance and delivery
of the above-referenced bonds (the "Bonds"). The issuance and delivery of the Bonds, in
exchange for payment in full therefor (the "Closing"), was held at the offices of Gottlieb, Fisher
& Andrews, PLLC ("Bond Counsel"), 520 Pike Street, Suite 2510, Seattle, Washington 98101,
commencing at 9:00 a.m., on August 8, 2006.
The delivery of all documents and all other actions taken at the Closing were considered
to have been made and taken simultaneously, and no delivery or action was considered to have
been made or taken until all deliveries and actions constituting a part of the Closing were
completed.
Capitalized terms defined in Ordinance No. 5215 (the "Bond Ordinance") of the City of
Renton, Washington (the "City"), and used herein shall have the same meanings when used in
this memorandum, unless the context otherwise directs.
I. Actions Taken Prior to Closing
A. Authorization of Issuance and Sale of Bonds.
On July 17, 2006, pursuant to the Bond Ordinance, the City (a) authorized, inter alia, the
issuance and delivery of the Bonds to provide part of the funds necessary to pay part of the costs
of constructing transportation and utility infrastructure and improvements in the South Lake
Washington Infrastructure project and the SW 27th Street Extension project, and to pay certain
incidental costs and costs related to the sale and issuance of the Bonds; (b) fixed the date,
denominations, form, terms, registration privileges, maturity, interest rates and covenants of the
Bonds; (c) established a debt service fund and project fund for the Bonds; (d) provided for the
annual levy of taxes to pay the principal of and the interest on the Bonds; and (e) approved the
sale and provided for the sale and delivery of the Bonds to D.A. Davidson & Co., Seattle,
Washington (the "Underwriter").
B.Execution of Purchase Agreement.
The Purchase Agreement was executed by the City and the Underwriter on July 17, 2006.
C. Insurance Commitment.
On July 18, 2006, MBIA Insurance Corporation (the "Bond Insurer") issued its revised
commitment to issue a financial guaranty insurance policy for the Bonds (the "Insurance
f:~renton\ltgo 06 1
Policy’’), upon the payment of a premium of $49,000.00 and satisfaction of certain conditions set
forth in the commitment.
D. Preparation and Execution of Bonds.
The Bonds, in form prescribed by the Bond Ordinance and approved by the Underwriter,
were prepared by Bond Counsel, manually executed by the Mayor and the City Clerk and
impressed with the seal of the City.
E. Authentication of Bonds.
The executed Bonds were authenticated by The Bank of New York, the Fiscal Agency of
the State of Washington and registrar for the Bonds (the "Registrar") in New York, New York.
At the direction of the Underwriter, the Registrar held the executed and authenticated Bonds in
escrow, as agent for The Depository Trust Company ("DTC") in New York, New York, pending
the completion of Closing.
F.Delivery of Documents to Bond Counsel.
All of the other agreements, certificates, letters, opinions and documents listed on
Exhibit A hereto were prepared by the persons listed under the heading "Responsibility" on
Exhibit A, and were delivered by such persons to Bond Counsel to be held in escrow by Bond
Counsel pending the completion of the Closing.
II. Actions Taken at Closing
A. Review of Documents.
All of the agreements, certificates, letters, opinions and other documents listed on
Exhibit A hereto were reviewed (to the extent each deemed necessary) by the City, the
Underwriter and all other persons having executed or having any interest in any document listed
on Exhibit A hereto, and all of said persons indicated to Bond Counsel their approval of the form
and substance of such documents.
B. Execution of Documents.
Al! of the agreements, certificates, letters, opinions and other documents listed on
Exhibit A hereto which required execution and had not previously been executed, were executed
by the appropriate persons and delivered to Bond Counsel and were held in escrow by Bond
Counsel pending the completion of the Closing.
C. No Litigation.
The City confirmed that no litigation or other proceedings were pending or threatened
regarding the Bonds or affecting the transaction.
f:krenton\ltgo 06 2
D.Payment of Purchase Price.
3. The Underwriter paid, on behalf of the City, to the Bond Insurer by means of wire
transfer the premium for the Insurance Policy in the amount of $49,000.00. Also, the City
received the sum of $18,490,028.72 from the Underwriter, said sum being full payment of the
aggregate purchase price therefor, computed as follows:
Principal Amount of Bonds
Plus: Net Original Issue Premium
Plus: Accrued Interest from August 1, 2006
Less: Underwriter’s Discount
$17,980,000.00
660,506.35
17,174.50
(118,652.13)
Purchase Price of the Bonds $18,539,028.72
Less: Premium for the Insurance Policy (49,000.00)
Aggregate Purchase Price of the Bonds $18,490,028.72
The purchase price of the Bonds was paid in same day funds by means of a federal funds
wire transfer.
E. Application of Purchase Price Proceeds.
Upon receipt of the purchase price proceeds of the Bonds, the City caused the sum of
$17,174.50 to be deposited in the "Limited Tax General Obligation Bond Fund, 2006" (the
"Bond Fund"), to be applied to the payment of interest due on the Bonds. The remaining
proceeds of the sale of the Bonds, less the underwriter’s discount and the bond insurance
premium paid by the Underwriter on behalf of the City and plus the net original issue premium,
in the amount of $18,472,854.22 were deposited, upon receipt, to the "South Lake Washington
Infrastructure Project Fund" (the "Project Fund") in accordance with the Bond Ordinance.
F.Release of Bond Documents.
The City, the Underwriter and all other persons having executed or having an interest in
any document listed on Exhibit A hereto, or their authorized representatives, authorized Bond
Counsel to release and deliver to the persons entitled to the same, the agreements, certificates,
letters, opinions and other documents listed on Exhibit A hereto which had been held in escrow
by Bond Counsel pending the completion of the Closing.
G. Delivery, of Bonds; Completion of Closing.
Bond Counsel called the Registrar and authorized them to release the Bonds with DTC
upon order from the Underwriter. Bond Counsel then declared that the Closing was completed.
f:\renton\Itgo 06 3
III. Actions Taken After Closing
A. Loose Transcripts. Four loose copies of the Transcript of Proceedings were
delivered shortly after the completion of Closing, one to Bond Counsel and three to the Bond
Insurer.
B. Bound Transcripts. Bound Transcripts of Proceedings were distributed by Bond
Counsel after Closing, as follows:
City of Renton
D.A. Davidson & Co.
Gottlieb, Fisher & Andrews, PLLC
TOTAL
1
1
C. CD-ROM Transcripts. Two CD-ROM Transcript of Proceedings were
delivered shortly after the completion of Closing, one to the City and one to Bond Counsel.
fArenton\ltgo 06 4
EXHIBIT A
$17,980,000
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
DOCUMENT
Certificate re Transcript
Ordinance No. 5215 Authorizing the
Sale and Issuance of the Bonds
Excerpts of Minutes of City Council Meeting
re Ordinance No. 5215
Affidavit of Publication of Ordinance No. 5215
Bond Purchase Agreement
Letter of Representations
Disclosure and Debt Limit Certificate
Disclosure Certificate of Bond Insurer
Signature and No Litigation Certificate
Certificate re Authentication and Registration of Bonds
Specimen Bond
Specimen Insurance Policy
Certificate of Issuer as to MBIA Insurance Policy
Preliminary Official Statement
Official Statement
Rating Letters
Certificate of Delivery and Payment
Underwriter’s Receipt
Nonarbitrage and Tax Exemption Certificate
Tax Certificate of Bond Insurer
RESPONSIBILITY
Bond Counsel
City
City
City
Underwriter
Bond Counsel
Bond Counsel
Bond Insurer
Bond Counsel
Bond Counsel
Bond Counsel
Bond Insurer
Bond Counsel
Underwriter
Underwriter
Bond Insurer
Bond Counsel
Bond Counsel
Bond Counsel
Bond Insurer
fArenton\ltgo 06 A-1
Underwriter’s Certificate
IRS Form 8038-G
Bond Report Form 101
Approving Opinion of Bond Counsel
Opinion of Counsel to Bond Insurer
Closing Memorandum
Bond Counsel
Bond Counsel
Underwriter
Bond Counsel
Bond Insurer
Bond Counsel
f:~renton\ltgo 06 A-2
GOT LIEB, FISHER &i ANDREWS, PLLC
ATTORNEYS AT LAW
MEMORANDUM
TO: Members of the 'inancing Team (see attached list)
FROM: Mary J. Turtle �/
Legal Assistant 6
RE: $17,980,000 CIT OF RENTON, WASHINGTON LIMITED TAX GENERAL
OBLIGATION B•NDS, 2006
DATE: August 25, 2006
Enclosed please find yo I loose and/or bound transcript(s) for the above-referenced
financing. If you have any quest ons,pleasefeel free to give either Judy Andrews or me a call at
(206)654-1999.
Enclosure
520 Pike Street,Suite 2510 Seattle,WA 98101-4006
(206)554-1999 Phone (206)654-8725 Fax
$17,980,000
CI Y OF RENTON, WASHINGTON
LIMITED T• X GENERAL OBLIGATION BONDS, 2006
Distribution List
Mr. Michael Bailey Mr. Clifford Pritchard
Finance and Information Service. Administrator Associate
City of Renton MBIA Insurance Corporation
1055 South Grady Way 113 King Street
Renton, Washington 98055 Armonk, New York 10504
Mr. Fred Eoff
Senior Vice President&Managi g Director
D.A. Davidson & Co.
701 Fifth Avenue, Suite 3100
Seattle, Washington 98104
Z oOtpti Ff
STATE OF WASHINGTON, COUNTY OF KING }
AFFIDAVIT OF PUBLICATION CITY OF RENTON
NOTICE OF ORDINANCES
PUBLIC NOTICE ADOPTED BY
RENTON CITY COUNCIL
Jody L.Barton,being first duly sworn on oath that she is the Legal Advertising Following is a summary of ordi-
Representative of the nances adopted by the Renton City
Council on July 17,2006:
ORDINANCE NO.5214
An ordinance of the City of Renton,
King County Journal Washington, vacating a portion of
Park Avenue N., between N. 8th St.
and Logan Avenue N., for the pro-
"a daily newspaper, which newspaper is a legal newspaper of general posed"The Landingsite development
streetVAC-
circulation and is now and has been for more than six months prior to the date 04-005)system. (Citydescription of Renton;is The legal is on file '
of publication hereinafter referred to, published in the En:lish lan l ua e-_ st the_City C1er-lcs-o#fice-and-is-avail-
continuously as a .ai y newspaper in King County, Washington. The King able upon request.
Effective:7/26/2006
County Journal has been approved as a Legal Newspaper by order of the ORDINANCE NO.5215
Superior Court of the State of Washington for King County. An ordinance of the City of Renton,
The notice in the exact form annexed was published in regular issues of the Washington, relating to the incur-
rence of indebtedness; providing for
King County Journal (and not in supplement form) which was regularly the sale and issuance of Limited Tax
distributed to its subscribers during the below stated period. The annexed General Obligation bonds,2006,in the
aggregate principal amount of
notice,a $17,980,000 to provide part of the
costs of constructing transportation
and utility infrastructure and
Public Notice improvements in the City;providing
for the date, denominations, form,
terms,registration privileges,maturi-
was published on July 21,2006. ties, interest rates and covenants of
the bonds; providing for the annual
levy of taxes to pay the principal
The full amount of the fee charged for said foregoing publication is the sum thereof and the interest thereon;
establishing a debt service fund for
of $126.00. �q�ax t i,is iiif 1,, the bonds;and providing for the sale
..S\� ,; f ,,�i and delivery of such bonds to D.A. r*
,.,. ,•y,••-1,; f� Davidson&Co.,Seattle,Washington.
ipzii , ,... �. 0�C(1'-SS/v„',,, y Effective:7/26/2006
o • G r Complete text of these ordinances is
A'� "'. ' available at Renton City Hall, 1055
^�
�QtC' South Grady Way;and posted at the
Barton , 1 ,= Renton Public Libraries,100 Mill Ave
Legal Advertising Representative,King County Journal t..:!:. 20I, nue South and 2902 NE 12th Street.
Subscribed and sworn to me this 21st day of July,2006. 4�� Upon request to the City Clerk's
r ° office,(425)430-6510,copies will also
`; "" be mailed for a fee.
/72D (?'// L ���.j v� `tif. : r,, Bonnie I.Walton
B D Cantelon c ``4' -��11�,�so
City Clerk
Published in the King County Journal
Notary Public for the State of Washington,Residing in Kent,Washington` July 21,2006.#861099
PO Number:
f` �
Uti�Y.. .; �� 4 CIT�c-.._,:0F RENTON
♦ x�: : o City Clerk
Kathy Keolker,Mayor Bonnie I.Walton
Nom.
August 3, 2006
Mary J. Turtle
Gottlieb,Fisher&Andrews, :LLC
520 Pike Street, Suite 2510
Seattle, WA 98101
- I
Re: City of Renton, LTG. Bonds, 2006
Dear Ms. Turtle:
In response to your request, I enclose a certified copy of 1) Ordinance No. 5215, 2) a
certified copy of the minutes from the City Council meeting of July 17, 2006, at which
Ordinance No. 5215 was ado iI ted, and 3) an affidavit of publication of Ordinance No.
5215.
These documents,-along wit :the seven Signature identification and No Litigation
Certificates mailed to you o July 27, 2006, should complete your emailed request of July
21, 2006:
If I.can provide further info .ation or assistance,please feel free to contact me.
Sincerely, _
86-mue:
Bonnie I. Walton
City Clerk
Enc. (3).
.. cc: Michael Bailey,Finance&Information Services Administrator '
•
•
1055 South Grady Way-Renton,.Was ington 98055-(425)430-65.10/FAX(425)430-6516 R E lr. 1 -0 lr
AHEAD OF THE CURVE
This paper contains 50%recycled material,30%post consumer
i
STATE OF WASHINGTON, COUNTY OF KING }
AFFIDAVIT OF PUBLICATION CITY OF RENTON
NOTICE OF ORDINANCES
ADOPTED BY
PUBLIC NOTICE RENTON CITY COUNCIL
Jody L.Barton,-being first duly sworn on oath that she is the Legal Advertising Following is a summary of ordi-
nances adopted by the Renton City
Representative of the Council on July 17,2006:
ORDINANCE NO.5214
An ordinance of the City of Renton,
King County Journal Washington, vacating a portion of
Park Avenue N., between N. 8th St.
and Logan Avenue N., for the pro-
a daily newspaper, which newspaper is a legal newspaper of general posed"The Landing"site development
street system. (City of Renton;VAC-
circulation and is now and has been for more than six months prior to the date 04-005) The legal description is on file
of_._publication hereinafter referred to, published in the English language at the City Clerk's office,and is avail-
continuously as a daily newspaper in King County, Washitsgtoli. The—King aEe upon request.
Efl'eetive:-7/2sl2IIos
County Journal has been approved as a Legal Newspaper by order of the ORDINANCE NO.5215
Superior Court of the State of Washington for King County. An ordinance of the City of Renton,
incur-
The notice in the exact form annexed was published in regular issues of the providing
Washington, relating tothe g rence of indebtedness; providing for
King County Journal (and not in supplement form) which was regularly the sale and issuance of Limited Tax
distributed to its subscribers during the below stated period. The annexed General Obligation bonds,2006,in the
notice,a aggregate principal amount of
$17,980,000 to provide part of the
costs of constructing transportation
and utility infrastructure and
Public Notice improvements in the City; providing
for the date, denominations, form,
terms,registration privileges,maturi-
was published on July 21,2006. ties, interest rates and covenants of
the bonds; providing for the annual
levy of taxes to pay the principal
The full amount of the fee charged for said foregoing publication is the sum thereof and the interest thereon;
of $126.00. establishing a debt service fund for
the bonds;and providing for the sale
`ti ir: ;i i 11/4,�� and delivery of such bonds to D.A.
• �iionlo. . ., v (� .�. ..i pp Davidson&Co.,Seattle,Washington.
a� 148, A r�.. �,, Effective:7/26/2006
�,. .(C"`
t�� O'i fi cif Complete text of these ordinances is
JF Co t;•, available at Renton City Hall, 1055
• arton o �,�� q�?1 :�:• =a South Grady Way;and posted at the
Renton Public Libraries,100 Mill Ave-
-g. Advertising Representative,King County Journal �� 1 nue South and 2902 NE 12th Street.
Subscribed and sworn to me this 21St day of July,2006. 201 C' z Upon request to the City Clerk's
J w office,(425)430-6510,copies will also
f 7 p ��//,Yi� �N _ be mailed forW a fee.
�j,' t,r c•. Bonnie I.Walton
J,.2. ,1 _, • ,. City Clerk
B D Cantelon `4 y" 44 � Published in the King County Journal
Notary Public for the State of Washington,Residing in Kent,Washington July 21,2006.#861099
PO Number:
RENTON CITY COUNCIL
Regular Meeting
July 17,2006 Council Chambers
Monday,7 p.m. MINUTES Renton City Hall
CALL TO ORDER ayor Kathy Keolker called the meeting of the Renton City Council to order
nd led the Pledge of Allegiance to the flag.
ROLL CALL OF ' • NDY CORMAN,Council President;TONI NELSON;DAN CLAWSON;
COUNCILMEMBERS 'ENIS LAW;TERRI BRIERE;MARCIE PALMER;DON PERSSON.
CITY STAFF IN THY KEOLKER,Mayor;JAY COVINGTON,Chief Administrative
ATTENDANCE I fficer;ZANETTA FONTES,Assistant City Attorney;BONNIE WALTON,
ity Clerk;PETER HAHN,Deputy Planning/Building/Public Works
•dministrator-Transportation;TERRY HIGASHIYAMA,Community
ervices Administrator;BETTE ANDERSON,Library Director;VINCENT
•RDUNA,Cultural Arts Coordinator;ALEX PIETSCH,Economic
evelopment Administrator;MICHAEL BAILEY,Finance and Information
ervices Administrator;MARTY WINE,Assistant CAO;COMMANDER
NT CURRY,Police Department.
SPECIAL PRESENTATION ommunity Services Administrator Terry Higashiyama introduced Bette
Library:New Director(Bette •nderson,the new Library Director. Ms.Anderson stated that she is looking
Anderson) orward to working with everyone and to working on the Library Master Plan.
Community Services: "Damn ontinuing,Ms. Higashiyama introduced Cultural Arts Coordinator Vincent
Yankees"Teen Musical I rduna who announced that Renton's annual 2006 summer teen musical,
Performance Excerpts 'Damn Yankees,"will run from July 21 to August 13 at Carco Theatre. He
introduced performers Joshua Paul Moore,Monica Taylor,Kathryn Stewart,
teven Hudson,Brad Walker,Thomas Webber,and Lee Morris who entertainer
he audience with two sample numbers from the show.
ADMINISTRATIVE hief Administrative Officer Jay Covington reviewed a written administrative
REPORT eport summarizing the City's recent progress towards goals and work program:
dopted as part of its business plan for 2006 and beyond. Items noted included:
* "Celebrate the Heart of Renton"at IKEA Renton River Days,a family
festival celebrating pride in the community July 18 through July 23.
* Over 700 kids,parents,and friends attended the T-Ball and Coach Pitch
Jamboree on July 13. This summer's program has 12 Coach Pitch teams
and 16 T-Ball teams.
Streets:Park Ave N Closure, eter Hahn,Deputy Planning/Building/Public Works Administrator-
South Lake Washington Transportation,reported on the temporary closure of Park Ave.N.(N. 6th St.to
Roadway Improvements 'Garden Ave.N.),for the South Lake Washington roadway and utility
improvements,and described the Garden Ave.N.detour route. He indicated
that the closure may be postponed until after the Renton River Days festival,
which will be held this week. In response to Council inquiries,Mr.Hahn stated
that Park Ave. N. could be closed for as long as 14 months. He assured that
affected business owners were notified of the street closure.
AUDIENCE COMMENT Sande!DeMastus,Highlands Community Association Vice President,PO Box
Citizen Comment: DeMastus- 2041,Renton,98056,expressed her thanks for those who have supported the
Highlands Community Highlands Community Association and her disappointment with those she feels
Association have;behaved inappropriately. Noting the importance of keeping all
CERTIFICATE
l 1Jc.
1,the undersigned City Clerk of the �> --• ,•�-�
City of Renton, Washington,certify :- =�' *_
�
that is is a true and correct copy of e' S
1//7/0o. eQ4ne;! ;n ues. Subscribed , . -.
and sealed this 3/ day of July ,20 ab
6.4-x.41.41 ZiAl > '' 4Tfr�
City Clerk
C ! OF RENTON,WASHINGTON
ORDINANCE NO. 5215
AN ORDINAN E RELATING TO THE INCURRENCE OF
INDEBTEDNE S; PROVIDING FOR THE SALE AND
ISSUANCE OF LIMITED TAX GENERAL OBLIGATION
BONDS, 2006, IN THE AGGREGATE PRINCIPAL
AMOUNT OF 17,980,000 TO PROVIDE PART OF THE
COSTS OF C s NSTRUCTING TRANSPORTATION AND
UTILITY INFSTRUCTURE AND IMPROVEMENTS IN
THE CITY; PROVIDING FOR THE DATE,
DENOMINATI NS, FORM, TERMS, REGISTRATION
PRIVILEGES, MATURITIES, INTEREST RATES AND
COVENANTS F THE BONDS; PROVIDING FOR THE
ANNUAL LE OF TAXES TO PAY THE PRINCIPAL
THEREOF D THE INTEREST THEREON;
ESTABLISHIN A DEBT SERVICE FUND FOR THE
BONDS; AND PROVIDING FOR THE SALE AND
DELIVERY.OF SUCH BONDS TO D.A. DAVIDSON & CO.,
SEATTLE, WA HINGTON
. WHEREAS, the City of Renton (the "City") has determined that there is a need for
infrastructure and other improv ents for the South Lake Washington Infrastructure project and
the SW 27th Street Extension p j ect and it is in the best interest of the residents of the City to
construct such roadway and utili y infrastructure improvements in the City; and
WHEREAS, the City Co•uncil deems it to be in the best interest of the City that the City
borrow money and issue and se 1 obligations in the form of limited tax general obligation bonds
for the purpose of providing p. of the costs of the Project(hereinafter defined); and
WHEREAS, the incurr nce of indebtedness by the City to pay the costs of the Project
will not cause the total indebtedness of the City to be incurred without the assent of the voters of
the City to exceed the limitations set forth in. te '39.36 RCW; and
iiifif.„0/. 4. .'••?: CERTIFICATE
'17 tikir .. * 1,the undersigned City Clerk of the
s.;f; - ;. City of Renton,Washington,certify
';00% + that this is a true and correct copy of
'�••••�:.-•••.. ORD. 5215 . Subscribed
and sealed this 26 day of July ,2006
City Clerk Bonnie I. Walton
From: "Mary Turtle" <mary goandfish.com>
To: <bwalton@ci.renton. a.us>
Date: 7/21/2006 3:17:33 PM
Subject: City of Renton, WA, LTGO Bonds, 2006
As we talked about earlier today, attached please find the Signature 0;y1()IP
Identification and No Litigation Certific to pertaining to theVA_ �1"
above-referenced issue. Please printcut 7 copies of this document, sign
each of them and return to my attentio no later than Monday, July 31, 2006.
Can you also please forward to us,wh n they are available, (1)a certified
copy of Ordinance No. 5215, (2)the m nutes or appropriate excerpts of
minutes from the City Council meeting of July 17, 2006 at which Ordinance
No. 5215 was adopted, and (3) an affi avit of publication of Ordinance No.
5215.
If you have any questions, feel free to all or email either Judy Andrews or
me. Thank you for all your help.
Mary J. Turtle
Gottlieb, Fisher&Andrews, PLLC
520 Pike Street, Suite 2510
Seattle, Washington 98101
Phone: (206)654-1999
Fax: (206) 654-8725
SIGNATURE IDE IFICATION AND NO LITIGATION CERTIFICATE ,
•
I, BONNIE I. WALT i N, hereby certify that:
1. I am the duly a'pointed, qualified, and acting City Clerk of the City of Renton,
Washington(the"City").
2. This Certificat: is made and delivered in connection with the authorization, sale,
issuance and delivery of the$ 7,980,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERALOBLIGATION BONDS, 2006 (the"Bonds").
3. Pursuant to Ore finance No. 5215 of the City(the "Bond Ordinance"), authorizing
the issuance and sale of the Bo ds, each of the Bonds was duly executed on behalf of the City
with the manual signature of I ' THY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with m, manual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor K;olker and the signature appearing on the Bonds is her true and
genuine signature.
4. The manual si a ature appearing below is my true and genuine signature.
5. The seal of the ( ity appearing on each of the Bonds is the legally adopted, proper
and official seal of the City.
6. The following pity Council members were incumbent on July 17, 2006, the date
on which the City Council ado o ted the Bond Ordinance, and they remain incumbent in such,
positions on this date:
Randall Corman
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. • No litigation or ther proceedings are pending or, to the best of my knowledge,
threatened in any court or other tribunal of competent jurisdiction, state or federal, in any way:
(a) Restra' ' g or enjoining the sale or delivery by the City of the Bonds;
(b) Questions g in any manner the authority of the City to issue, or the
issuance or validity of the Bonds;
(c) Questioning the constitutionality of any statute, ordinance or resolution, or
the validity of any proce dings, authorizing the issuance of the Bonds;
f:\renton\Itgo 06 1
(d) Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(0 Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect adversely affect the transactions
contemplated herein and in the Official Statement to be undertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
BONNIE I. WALTON
City Clerk
City of Renton, Washington
f:\renton\ltgo 06 2
SIGNATURE IDENT ICATION AND NO LITIGATION CERTIFICATE
I, BONNIE I. WALTON, ereby certify that:
,1. I am the duly appoi nted, qualified, and acting City Clerk of the City of Renton,
Washington(the"City").
2. This Certificate is ade and delivered in connection with the authorization, sale,
issuance and delivery of the$17,"80,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATION BONDS, 2006 (the"Bonds").
3. Pursuant to Ordin. ce No. 5215 of the City(the "Bond Ordinance"), authorizing
the issuance and sale of the Bon I , each of the Bonds was duly executed on behalf of the City
with the manual signature of KA HY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with my anual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor Keolker and the signature appearing on the Bonds is her true and
genuine signature.
4. The manual signature appearing below is my true and genuine signature.
5. The seal of the City appearing on each of the Bonds is the legally adopted,proper
and official seal of the City.
6. The following Ci y Council members were incumbent on July 17, 2006, the date
on which the City Council adop led the Bond Ordinance, and they remain incumbent in such
positions on this date:
Randall Corman
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. No litigation or ether proceedings are pending or, to the best of my knowledge,
threatened in any court or other tribunal of competent jurisdiction, state or federal, in any way:
(a) Restraining or enjoining the sale or delivery by the City of the Bonds;
(b) Questio 'ng in any manner the authority of the City to issue,or the
issuance or validity of t a Bonds;
(c) Questioning the constitutionality of any statute, ordinance or resolution, or
the validity of any proc edings, authorizing the issuance of the Bonds;
f:\rentonMtgo 06 1
(d) Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(f) Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect adversely affect the transactions
contemplated herein and in the Official Statement to be undertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
ii u
BONNIE I. WALTON
City Clerk
City of Renton, Washington
fl\renton\ltgo 06 2
SIGNATURE IDEN IFICATION AND NO LITIGATION CERTIFICATE
I, BONNIE I. WALTO , hereby certify that:
1. I am the duly ap ointed, qualified, and acting City Clerk of the City of Renton,
Washington(the"City").
2. This Certificate i made and delivered in connection with the authorization, sale,
issuance and delivery of the$1 ,980,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATIO BONDS, 2006 (the"Bonds").
3. Pursuant to Ordi ance No. 5215 of the City(the"Bond Ordinance"), authorizing
the issuance and sale of the Bo s, each of the Bonds was duly executed on behalf of the City
with the manual signature of KATHY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with my manual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor Keolker and the signature appearing on the Bonds is her true and
genuine signature.
4. The manual sign ture appearing below is my true and genuine signature.
5. The seal of the C ty appearing on each of the Bonds is the legally adopted, proper
and official seal of the City.
6. The following C y Council members were incumbent on July 17, 2006, the date
on which the City Council adop ed the Bond Ordinance, and they remain incumbent in such
positions on this date:
Randall Corman
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. No litigation or o her proceedings are pending or, to the best of my knowledge,
threatened in any court or other ribunal of competent jurisdiction, state or federal, in any way:
(a) Restraining or enjoining the sale or delivery by the City of the Bonds;
(b) Questioning in any manner the authority of the City to issue, or the
issuance or validity of thb Bonds;
(c) Questioning the constitutionality of any statute, ordinance or resolution, or
the validity of any procedings, authorizing the issuance of the Bonds;
f:\renton\ltgo 06 1
(d) Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(f) Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect adversely affect the transactions
contemplated herein and in the Official Statement to be undertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
BONNIE I. WALTON
City Clerk
City of Renton, Washington
f:\renton\tgo 06 2
SIGNATURE IDEN IFICATION AND NO LITIGATION CERTIFICATE
I, BONNIE I. WALTO , hereby certify that:
1. I am the duly ap ointed, qualified, and acting City Clerk of the City of Renton,
Washington (the"City").
2. This Certificate is made and delivered in connection with the authorization, sale,
issuance and delivery of the $17,980,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATION BONDS, 2006 (the"Bonds").
3. Pursuant to Ordinance No. 5215 of the City(the"Bond Ordinance"), authorizing
the issuance and sale of the Bods, each of the Bonds was duly executed on behalf of the City
with the manual signature of KATHY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with my manual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor Keolker and the signature appearing on the Bonds is her true and
genuine signature.
4. The manual sign ture appearing below is my true and genuine signature.
5. The seal of the ity appearing on each of the Bonds is the legally adopted, proper
and official seal of the City.
6. The following C ty Council members were incumbent on July 17, 2006, the date
on which the City Council adopted the Bond Ordinance, and they remain incumbent in such
positions on this date:
Randall Corman
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. No litigation or other proceedings are pending or, to the best of my knowledge,
threatened in any court or other tribunal of competent jurisdiction, state or federal, in any way:
(a) Restrai ' g or enjoining the sale or delivery by the City of the Bonds;
(b) Questioning in any manner the authority of the City to issue;or the
issuance or validity of the Bonds;
(c) Questioning the constitutionality of any statute, ordinance or resolution, or
the validity of any proceedings, authorizing the issuance of the Bonds;
f:\rentonVtgo 06 1
t
(d) Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(f) Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect adversely affect the transactions
contemplated herein and in the Official Statement to be undertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
) d. Cth
BONNIE I. WALTON
City Clerk
City of Renton, Washington
f:\renton\ltgo 06 2
SIGNATURE IDEN IFICATION AND NO LITIGATION CERTIFICATE
I, BONNIE I. WALTO ', hereby certify that: .
1. I am the duly apo ointed, qualified, and acting City Clerk of the City of Renton,
Washington(the"City").
2. This Certificate 's made and delivered in connection with the authorization, sale,
issuance and delivery of the $1 ,980,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATIO BONDS, 2006 (the"Bonds").
3. Pursuant to Ordinance No. 5215 of the City(the "Bond Ordinance"), authorizing
the issuance and sale of the Bonds, each of the Bonds was duly executed on behalf of the City
with the manual signature of THY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with m manual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor Keolker and the signature appearing on the Bonds is her true and
genuine signature.
4. The manual sign tune appearing below is my true and genuine signature.
5. The seal of the ity appearing on each of the Bonds is the legally adopted, proper
and official seal of the City.
6. The following C ty Council members were incumbent on July 17, 2006,the date
on which the City Council adopted the Bond Ordinance, and they remain incumbent in such
positions on this date:
Randall Corman
Terri Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. No litigation or .ther proceedings are pending or, to the best of my knowledge,
threatened in any court or other tribunal of competent jurisdiction, state or federal, in any way:
(a) Restraining or enjoining the sale or delivery by the City of the Bonds;
(b) Questioning in any manner the authority of the City to issue, or the
Q g Y
issuance or validity of tlie Bonds;
(c) Question ng the constitutionality of any statute, ordinance or resolution, or
the validity of any proc Questioning
authorizing the issuance of the Bonds;
f:\rentonUtgo 06 1
(d) Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(f) Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect adversely affect the transactions
contemplated herein and in the Official Statement to be undertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
BONNIE I. WALTON
City Clerk
City of Renton, Washington
f:\renton\ltgo 06 2
•'
SIGNATURE IDENT 0 ICATION AND NO LITIGATION CERTIFICATE
I, BONNIE I. WALTON, hereby certify that:
1. I am the duly app•inted, qualified, and acting City Clerk of the City of Renton,
Washington(the"City").
2. This Certificate isi ade and delivered in connection with the authorization, sale,
issuance and delivery of the $17,"80,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATION BONDS, 2006 (the"Bonds").
3. Pursuant to Ordin.nce No. 5215 of the City(the "Bond Ordinance"), authorizing
the issuance and sale of the Bond., each of the Bonds was duly executed on behalf of the City
with the manual signature of KA HY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with my anual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor Keol er and the signature appearing on the Bonds is her true and
genuine signature.
4. The manual signat e appearing below is my true and genuine signature.
5. The seal of the Cit1 appearing on each of the Bonds is the legally adopted,proper
and official seal of the City.
6. The following City Council members were incumbent on July 17, 2006, the date
on which the City Council adopted the Bond Ordinance, and they remain incumbent in such
positions on this date:
Randall Gorman
Tern Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. No litigation or of er proceedings are pending or, to the best of my knowledge,
threatened in any court or other bunal of competent jurisdiction, state or federal, in any way:
(a) Restrainin or enjoining the sale or delivery by the City of the Bonds;
(b) Questionin in any manner the authority of the City to issue, or the
issuance or validity of the Bonds;
(c) Questionin the constitutionality of any statute, ordinance or resolution, or
the validity of any procee ings, authorizing the issuance of the Bonds;
f:\renton\ltgo 06 1
(d) Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(f) Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect adversely affect the transactions
contemplated herein and in the Official Statement to be undertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
i Wat
BONNIE I. WALTON
City Clerk
City of Renton, Washington
•
f:\renton\ltgo 06 2
SIGNATURE IDENTIFICATION AND NO LITIGATION CERTIFICATE
I, BONNIE I. WALTOIN, hereby certify that:
1. I am the duly ap ointed, qualified, and acting City Clerk of the City of Renton,
Washington (the"City").
2. This Certificate i made and delivered in connection with the authorization, sale,
issuance and delivery of the $17,980,000 CITY OF RENTON, WASHINGTON, LIMITED
TAX GENERAL OBLIGATIO BONDS, 2006 (the"Bonds").
3. Pursuant to Ordi ance No. 5215 of the City(the"Bond Ordinance"), authorizing
the issuance and sale of the Bon s, each of the Bonds was duly executed on behalf of the City
with the manual signature of KATHY KEOLKER, who is the duly elected, qualified and acting
Mayor of the City; and with my anual signature, in my capacity as City Clerk. I am familiar
with the signature of Mayor Ke•lker and the signature appearing on the Bonds is her true and
genuine signature.
4. The manual sign.tare appearing below is my true and genuine signature.
5. The seal of the C ty appearing on each of the Bonds is the legally adopted,proper
and official seal of the City.
6. The following Ci y Council members were incumbent on July 17, 2006, the date
on which the City Council adop ped the Bond Ordinance, and they remain incumbent in such
positions on this date:
Randall Conran
Tern Briere
Dan Clawson
Denis Law
Toni Nelson
Marcie Palmer
Don Persson
7. No litigation or o her proceedings are pending or, to the best of my knowledge,
threatened in any court or other tribunal of competent jurisdiction, state or federal, in any way:
(a) Restraining or enjoining the sale or delivery by the City of the Bonds;
(b) Questioning in any manner the authority of the City to issue, or the
issuance or validity of th Bonds;
(c) Questions g the constitutionality of any statute, ordinance or resolution, or
the validity of any proceedings, authorizing the issuance of the Bonds;
f\renton\ltgo 06 1
I
(d) Questioning the validity or enforceability of the Bond Ordinance;
(e) Contesting in any way the completeness, accuracy or fairness of the
Official Statement;
(0 Questioning the titles of any officers of the City under the laws of the
State of Washington; or
(g) Which might in any material respect,adversely affect the transactions
contemplated herein and in the Official Statement to,beiundertaken by the City or the
financial condition of the City.
IN WITNESS WHEREOF, I have hereunto subscribed by official signature as of the 8th
day of August, 2006.
egiii4ta:
BONNIE I. WALTON
City Clerk
City of Renton, Washington
£\renton\ltgo 06 2
NOM?
CITY OF RENTON,WASHINGTON
LIMITED T GENERAL OBLIGATION BONDS,.2006
B ND PURCHASE AGREEMENT
July 17, 2006
City of Renton
1055 S. Grady
Renton,WA 98058
On the date hereof, the City Counci (the "Council") of the City of Renton (the "Issuer") adopted a bond
ordinance (the "Ordinance") autho 'zing the sale, issuance and delivery of the Issuer's Limited Tax
General Obligation Bonds, 2006 (t e "Bonds"), and the Issuer's execution and delivery of this Bond
Purchase Agreement(the"Agreeme t").
In light of such authority, the unders gned(the"Underwriter")offers to enter into this Agreement with the
Issuer. Upon your acceptance,thisAgreement shall be in full force and effect in accordance with its terms
and shall be binding upon the Issuer nd the Underwriter.
1) Sale; Purchase Price. Upon t e terms and conditions and in reliance upon the representations set
forth herein, the Underwriter hereby agrees to purchase from the Issuer and the Issuer hereby agrees
to sell to the Underwriter all(but not less than all) of the Bonds in the aggregate principal amount of
$17,980,000 at an aggregate p chase price of$18,521,854.22, which amount represents the (i) net
reoffering premium of$660,50.35 and (ii) Underwriter' discount of$118,652.13 ($6.60/$1,000 of
par value of the Bonds), together with accrued interest on the Bonds from August 1, 2006 to the
Closing Date. The Bonds shall lr issued and secured under and pursuant to the Ordinance dated July
17,2006 and shall mature,bear interest and be subject to redemption as set forth in Exhibit A hereto.
2) Representations of the Underwriter. The Underwriter agrees to make a bona_fide public offering of
all the Bonds at not in excess o the initial public offering prices, or less than the yields, set forth on
Exhibit A hereto, plus accrued interest, if any. Subsequent to such initial public offering, the •
Underwriter reserves the right io change the public offering prices and yields as they may deem
necessary in connection with the marketing of the Bonds.
The Bonds may be offered and sold to certain dealers and others (including Underwriter and other
dealers depositing Bonds into i o vestment trusts or mutual funds) at prices lower than such public
offering prices.
3) Preliminary and Final Official Statements. The Issuer shall deliver or cause to be delivered to the
Underwriter as soon as practicable, and not more than seven (7) business days, after acceptance
hereof, the Official Statement, s� bstantially in the form of the Preliminary Official Statement dated
July 5, 2006 the "Preliminary O ficial Statement") with only such changes therein as shall have been
accepted by the Underwriter (s,ch Preliminary Official Statement with such changes, if any, and
including the cover page and ail appendices, exhibits and statements included therein or attached
•
thereto being called the "Offici.1 Statement"). The Issuer hereby authorizes the distribution by the
Underwriter of the Preliminary Official Statement in offering the Bonds for sale to prospective
purchasers of the Bonds.
s..
'. 1
4) Closing. On August 8, 2006, o at such other time, or on such earlier or later date as the Underwriter
and the Issuer may mutually a ee (the "Closing Date"), the Underwriter will accept.delivery of the
Bonds and pay the purchase pri e thereof as set forth in Section 1 herein by Federal Reserve System
wire transfer in immediately av ilable Federal funds or by any other form of immediately available
Federal funds. TheBondssha 1 be delivered through The Depository Trust Company, New York,
New York ("DTC") in defini ye form, bearing CUSIP numbers and issued under a book-entry
system.
5) Representations of the Issuer. The Issuer makes the following representations and warranties:
a) The Issuer is a publi body corporate organized and existing under the laws of the State of
Washington and is uthorized to issue the Bonds, to enter into this Agreement and all
other agreements co templated hereby and to adopt the Ordinance.
b) The Issuer has comp ied to date with all applicable provisions of the laws of the State of
Washington in connection with the execution and issuance of the Bonds.
c) The Ordinance has b en duly and validly adopted, and this Agreement has been duly and
validly authorized an executed by the Issuer.
d) The Issuer has autho ' ed all necessary action to be taken by it for(i)the issuance and sale
of the Bonds upon the terms set forth herein, in the Official Statement and in the
Ordinance; (ii) the e ecution, delivery, receipt and due performance of this Agreement,
the Bonds and the 0 •'nance and all other agreements contemplated hereby or required in
order to carry out, g' e effect to and consummate the transactions contemplated hereby;
and(iii) carrying out, giving effect to and consummation of the transactions contemplated
hereby.
e) The Bonds when is.ued, delivered and paid for as provided for herein and in the
Ordinance, will hay: been duly and validly authorized and issued and will constitute
limited tax general o oligations of the Issuer secured as provided in the Ordinance and as
described in the Offic-al Statement.
f) To the best knowle•:e of the Issuer, there are no legal or governmental proceedings
pending or threatene•, or any basis therefore, wherein an unfavorable decision, ruling or
finding would have a material adverse effect on the validity or security of the Bonds, the
Ordinance, this Agre:ment or the transactions contemplated thereby or the power of the
Issuer to execute and •eliver the Bonds or this Agreement,or adopt the Ordinance.
g) As of the date here•f and to the knowledge of the Issuer, the Preliminary Official
Statement does not •ontain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein, in
light of the circumsta ces under which they were made,not misleading.
h) The Preliminary Official Statement is deemed "final" in accordance with Rule 15c2-
12(b)(1)under the Se unties Exchange Act of 1934.
6) Conditions to Closing. The Underwriter enters into this Agreement in, reliance upon the
representations and warranties of the Issuer contained herein and in the Ordinance and in reliance
upon the representations and w#ranties to be contained in the documents and instruments to be
delivered at the Closing Date and upon the performance by the Issuer and its obligations hereunder
both on and as of the date her of and as of the Closing Date. Accordingly, the Underwriter's
1
obligation under this Agreemen to accept delivery of and to pay for the Bonds shall be conditioned
upon the performance by the I�suer of its obligations to be performed hereunder and under such
documents and instruments at o prior to the Closing Date, and shall also be subject to the following
additional conditions:
a) the representations and arranties of the Issuer contained herein shall be true and correct on
the date hereof and on the Closing Date, as if made on and at the Closing Date;
b) at or prior to the Closing Date,the Underwriter shall receive the following documents:
i) certified cop'es of the Ordinance;
ii) the opinion f Gottlieb Fisher & Andrews, PLLC, as Bond Counsel, dated the
Closing Date, substantially in the form as attached in Appendix A to the Official
Statement;
iii) evidence of the insurance policy issued by MBIA Insurance Corporation("MBIA").
iv) evidence satisfactory to the Underwriter that Standard & Poor's Ratings Service
and Fitch Itings have each issued their ratinga for the Bonds not lower than
"AAA"and¶lat such ratings have not been withdrawn; and
v) such additio al legal opinions, certificates, proceedings, instruments and other
documents a the Underwriter or Bond Counsel may reasonably request.
If the conditions to the Un erwriter' obligations contained in this Agreement are not satisfied
(unless otherwise waived in writing by the Underwriter) or if the Underwriter's obligations shall
be terminated for any reaso permitted herein, this Agreement shall terminate and neither the
Underwriter nor the Issuer shall have any further obligation hereunder except to reimburse the
Underwriter for expenses related to the printing and mailing of the preliminary and final Official
Statements.
7) Official Statement Amendment and Supplements. During the initial public offering of the Bonds
(a period concluding on the final date the Underwriter is charged with furnishing a copy of the
Official Statement to a potential lcustomer under SEC Rule 15c2-12 but no later than six months after
the Closing Date), the Issuer will (a) not consent to the distribution of any amendment of or
supplement to the Official Statement to which, after having been furnished with a copy, the
Underwriter shall object in writing or which shall be disapproved by counsel for the Underwriter and
(b) if any event shall occur as a result of which it is necessary, in the opinion of the Underwriter, to
amend or supplement the Offici Statement in order to make the Official Statement not misleading in
light of the circumstances existing at the time it is delivered to a purchaser, consent to the distribution
of an amendment of or supplement to the Official Statement, prepared without expense to the Issuer
(in form and substance satisfactory to the Underwriter) in a reasonable number of copies which will
amend or supplement the Official Statement so that it will not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements therein, in the
light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not
misleading.
8) Underwriter Rights to Cancellation. The Underwriter shall have the right to cancel its obligation to
purchase the Bonds if between the date hereof and the Closing Date, (i) legislation shall have been
enacted by the Congress of the United States or the legislature of the State of Washington or •
legislation shall have been reported out of committee of either body or be pending in committee of
either body, or a decision shall ave been rendered by a court of the United States or of the State of
Washington or the Tax Court o the United States, or a ruling shall have been made or a regulation or
temporary regulation shall hav been proposed or made or any other release or announcement shall
. have been made by the Treasu Department of the United States or the Internal Revenue Service,
with respect to federal taxation pon revenues or other income of the general character of the Bonds
which, in the reasonable judgm nt of the of the Underwriter, materially adversely affects the market
for the Bonds, or(ii)there shall exist any event which, in the reasonable judgment of the Underwriter,
either (a) makes untrue or in orrect in any material aspect as of such time any statement or
information contained in the 0 cial Statement or (b) is not reflected in the Official Statement but
should be reflected therein in .rder to make the statements and information contained therein not
misleading in any material resp jet, or(iii) there shall have occurred any outbreak of hostilities or any
other national or international calamity or crisis,the effect of which outbreak, calamity or crisis on the
financial markets of the Unite. States is such as, in the reasonable judgment of the Underwriter,
would make it impracticable foi the Underwriter to market or enforce contracts for the sale of the
Bonds, or (iv) there shall be n force a general suspension of trading on the New York Stock
Exchange or minimum or ma imum prices for trading shall have been fixed and in force, or
maximum ranges for prices for .ecurities shall have been required and be in force on the New York
Stock Exchange, whether by vi e of a determination by that Exchange or by order of the Securities
and Exchange Commission or a y other governmental authority having jurisdiction, or (v) a general
banking moratorium shall have been declared by either Federal, State of Washington or New York
authorities having jurisdiction a d be in force, or(vi) there shall be established any new restriction on
transactions in securities materi lly affecting the free market for securities (including the imposition
of any limitation on interest rates) or extension.of credit by, or charge to the net capital requirements
of, Underwriter established b the New York Stock Exchange, the Securities and Exchange
Commission, any other federal .r state agency or the Congress of the United States, or by Executive
Order.
9) Fees and Expenses. All fees, ixpenses and costs incident to the execution and performance of this
Agreement and to the authoriza on, issuance and sale of the Bonds to the Underwriter, including, but
not limited to, the cost of printi g the Bonds, if any (and full execution thereof), the cost of printing
and mailing of the Preliminary and Final Official Statements, the fees and charges of Standard &
Poor's Ratings Service and Fitc Ratings,the municipal insurance policy premium of MBIA, the fees
of the financial advisor, and e fees and expenses of Bond Counsel and the Paying Agent and
Registrar shall be paid by the Iss er. All expenses to be paid by the Issuer pursuant to this Agreement
may be paid from Bond proceed• to the extent permitted by the Ordinance.
10)Notices. Any notice or other coy unication to be given to the Issuer under this Agreement may be
given by delivering the same in writing at the address set forth above and any such notice or other
communications to be given to he Underwriter may be given by delivering the same in writing to
D.A. Davidson & Co., 701 Fift Avenue, Suite 3100, Seattle, Washington 98104, Attention: Public
Finance. The approval of the Underwriter when required hereunder or the determination of its
satisfaction as to any document eferred to herein shall be in writing signed by the Underwriter and
delivered to you.
11)No Third Party Beneficiaries. This Agreement is made solely for the benefit of the Issuer and the
Underwriter(including successo s or assigns of the Underwriter,but excluding any purchaser, as such
purchaser, of Bonds from the derwriter) and, to the extent expressed herein, controlling persons
thereof, and no other persons, p rtnership, association or corporation shall acquire to have any right
hereunder or by virtue hereof. 11 representations and agreements of the parties to this Agreement
shall remain operative and in 11 force and effect regardless of any investigation made by or on
behalf of the Underwriter and sh 11 survive the delivery of and payment for the Bonds. Time shall be
of the essence of this Agreemen . This Agreement shall be governed by, construed and enforced in
accordance with the laws of th- State of Washington. This Agreement may be executed in any
number of counterparts each of hich shall be an original but all of which together will constitute one
and the same instrument.
Very truly yours,
D.A. DAVIDSON&CO.
Fred R. Eoff go
Senior Vice President&Managing Director
Accepted and Agreed:
CITY OF RENTON
By:4.tio leCO-de
Kathy eolker
Mayor
Attest:
Bonnie I.Walton,sty Clerk
©f REA,
<"-10 r ;.
EXHIBIT A
TERMS OF THE BONDS
Purchase Price: Par Amount of Bonds: $17,980,000.00
Plus:Reoffering remium: 660,506.35
Less:Underwrite 's Discount: (118,652.13)
Purchase Price: $18,521,854.22
Dated Date: August 1,2006
Delivery Date: August 8,2006
Form/Denominations: The Bonds will e issued in $5,000 denominations or integral multiples thereof in fully
registered Book-Entry only form through the facilities of The Depository Trust Company ("DTC") in New York,
New York.
Interest Payable: Interest on the onds from their dated date will be payable semi-annually on June 1 and
December 1 (commencing December 1,20 6)to their maturity or prior redemption.
Maturity Schedule: The Bonds ma re on the dates and in the amounts set forth below, subject to redemption
as hereinafter described, and will bear in ierest from August 1, 2006 to their respective maturities or dates of prior
redemption,whichever occurs first,at the .tes as shown below:
Date Amount Cou son Yield Price* Date Amount Cou i on Yield Price*
12/1/08 $520,000 4.25% 3.84°)o 100.894% 12/1/17 $775,000 5.00% 4.33% 105.519%
12/1/09 540,000 4.25 3.88 1 101.135 12/1/19 1,670,000 5.00 4.49 104.167
12/1/10 565,000 3.90 3.951 99.799 12/1/20 900,000 5.00 4.51 103.999
12/1/11 585,000 4.25 3.99 101.229 12/1/21 945,000 5.00 4.54 103.748
12/1/12 610,000 5.00 4.031 105.354 12/1/22 1,000,000_ 5.25 4.48 106.297
12/1/13 640,000 4.50 4.101 102.500 12/1/23 1,040,000 5.25 4.50 106.127
12/1/14 670,000 5.25 4.171 107.516 12/1/24 1,095,000 5.25 4.51 106.042
12/1/15 700,000 5.25 4.24 107.698 12/1/28 4,975,000 5.00 4.72 102.248
12/1/16 750,000 4.30 4.271 100.242
* Price is calculated to the December 1, 2016 optional redemption date for bonds maturing on and after December 1,
2017.
True Interest Cost: 4.6861218%
Optional Redemption:Bonds maturing on or after December 1,2017 are subject to redemption at the option of the
Issuer prior to their stated maturity date from funds from any source, at any time, in whole or in part on or after
December 1, 2016 within one or more maturities selected by the Issuer (by lot in the manner determined by the
Registrar or DTC)at the price of par(100%)plus interest accrued to the date of redemption.
Mandatory Term Bond Redemption:
Bonds maturing on December 1, 2019 are Term Bonds and subject to mandatory redemption at par (100%) in
accordance with the following schedule
12/1/18 $815,000
12/1/19 $855,000
Borid—s maturring on-December 1,2028 are Term Bonds and subject to mandatory redemption at par (100%) in
accordance with the following schedules
12/1/25 $1,155,000
12/1/26 $1,210,000 _
12/1/27 $1,275,000
12/1/28 $1,355,000 j
Bond Counsel: Gottlieb Fisher&Andrews,PLLC,Seattle,Washington
Registrar: The Bank of ew York,New York,NY
pk _
Copy 7� eta
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Number: 1 $520,000
ITED STATES OF AMERICA
STATE OF WASHINGTON
C OF RENTON, WASHINGTON
r _ LIMITED TAX GENERAL OBLIGATION BOND, 2006
r
Interest Maturity Date: CUSIP No.:
Rate: 4.25% December 1,2008 760133 QL 5
Owner: CEDE &CO.
Principal Amount: FIVE HUNDRED TWENTY THOUSAND AND NO/l00 DOLLARS
The CITY OF RENTO , WASHINGTON(the"City"), for value received, promises to
pay to the Owner set forth abov the Principal Amount set forth above, on the Maturity Date set
forth above; and to pay interest ereon(computed on the basis of a 360-day year of twelve
30-day months) from the date of this Bond or from the most recent interest payment date to
which interest has been paid or duly provided for, whichever is later, at the Interest Rate per
annum set forth above,payable on December 1, 2006, and semiannually thereafter on each
June 1 and December 1 to the n4aturity or earlier redemption of this Bond. If this Bond is not
paid upon proper presentment at its maturity or earlier redemption date, the City shall have the
obligation to pay interest at the Interest Rate set forth above from and after such maturity or
earlier redemption date until thil
'IIs Bond,both principal and interest, is paid in full.
• Capitalized terms defined in Ordinance No. of the City(the"Bond Ordinance") and
used herein shall have the same meanings when used herein,unless the context otherwise directs.
- Both principal of and interest on this Bond area able in lawful moneyof the United
pY
States of America: Prior to the Book-Entry Termination Date,principal of and interest on this
i. : Bond shall be paid by the Registrar to the Custodian as the Owner hereof for the benefit of the
Beneficial Owners hereof; in accordance with the Letter of Representations. From and after the
' ' Book-Entry Termination Date,principal of this Bond shall be paid to the Owner only upon
presentation and surrender Of this Bond by the Owner at either of the principal corporate trust
M
Offices of the fiscal agencies of the State of Washington(the"State")in Seattle, Washington, or
'
New York,New York(collectively, the"Registrar"). From and after the Book-Entry
" Termination Date, interest on this Bond shall be paid by check or draft mailed on or before the
. interest payment date to.the Owner at the address for such Owner appearing on the registration
books maintained by the Registrar(the"Bond Register") on the fifteenth day of the month
1
i I
f ` - a__
preceding the interest payment date;provided,however, that if so requested in writing by the
Owner of at least$1,000,000 principal amount of Bonds, interest will be paid by wire transfer on
the interest payment date to an ac ount with a bank located in the United States.
This Bond is a limited tax general obligation of the City. Unless the principal of and
interest on this Bond are paid fro other sources, so long as any Bonds are outstanding,the City
has irrevocably covenanted in th Bond Ordinance to include in its budgets and to make annual
levies of taxes within the constitutional and statutory tax limitations provided by law without a
vote of the qualified voters of th City upon all property within the City subject to taxation in
amounts which,together with an other money legally available therefor, shall be sufficient to
pay such principal and interest as the same shall become due. The City has irrevocably pledged
its full faith, credit and resourceslto the annual levy and collection of such taxes for the prompt
payment of such principal and interest.
This Bond is one of a dul authorized issue of bonds of the City designated"City of
Renton, Washington, Limited T General Obligation Bonds, 2006"(the"Bonds"), aggregating
$17,980,000 in principal amour ,maturing annually on December 1 in the years 2008 through
2017, inclusive, in the years 2020 through 2024, inclusive, and on December 1 in the years 2019
and 2028, of like date,tenor and effect, except as to number, maturity date, interest rate and
denomination. The Bonds are issued in fully registered form in the denomination of$5,000 each
or any integral multiple thereof ithin a single maturity.
The registered ownershi of this Bond may be transferred. Prior to the Book-Entry
Termination Date,the beneficia ownership of the Bonds may only be transferred on the records
established and maintained by t e Custodian. On and after the Book-Entry Termination Date,
this Bond may be transferred b t only in the manner and subject to the limitations set forth in the
Bond Ordinance, and only upon the surrender at any principal corporate trust office of the
Registrar of this Bond,with thel assignment form appearing hereon duly executed by the Owner
hereof or such Owner's duly authorized agent in a manner satisfactory to the Registrar. Upon
such surrender, the Registrar shall cancel the surrendered Bond and shall authenticate and
deliver, without charge to the Owner or transferee therefor(other than any governmental fees or
taxes payable on account of such transfer), a new Bond or Bonds(at the option of the new
Owner) of the same maturity and interest rate, and for the same aggregate principal amount,,in
• any authorized denomination,naming as Owner the person or persons listed as the assignee on
the assignment form appearing on the surrendered Bond, in exchange for such surrendered and
cancelled Bond. On and after the Book-Entry Termination Date, this Bond may be surrendered
at any principal corporate trust office of the Registrar and exchanged, without charge, for an
equal aggregate principal amount of Bonds of the same maturity and interest rate, in any
authorized denomination. TheRegistrar shall not be obligated to transfer or exchange any Bond
during the 15 days preceding any applicable interest payment,principal payment or redemption
date.
The Bonds maturing o December 1, in the years 2019 and 2028 are term bonds (the
WF "Term Bonds") and, if not previously purchased by the City in the open market or optionally
redeemed as set forth below, are subject to mandatory sinking fund redemption in part and by lot
(in such manner as the Registrar shall determine), at par plus accrued interest to the redemption
:i. : 2
,
date on December 1 in the followmng years and in the following mandatory sinking fund
redemption amounts:
Mandatory Sinking Fund
Redemption Dates Mandatory Sinking Fund
(December 1) Redemption Amounts
2018 $ 815,000
2019* 855,000
202111,155,000
2026 1,210,000
2027 1,275,000
2028* 1,335,000
*Scheduled maturity
The Bonds maturing on December 1 in the years 2008 through 2016, inclusive, shall not
be subject to redemption prior td maturity. The Bonds maturing on or after December 1, 2017
are subject to optional redempti 4 n prior to maturity beginning on December 1,2016, in whole or
in part at any time(maturities to be selected by the City and by lot within a maturity in such
manner as the Registrar shall de ermine), at par plus accrued interest to the date of redemption.
If the City shall optionally rede m Term Bonds or purchase Term Bonds in the open market,the
par amount of the Term Bonds o redeemed or purchased(irrespective of their actual redemption
or purchase prices) shall be cre ited against one or more scheduled mandatory redemption
amounts for such Term Bonds ( allocated by the City)beginning not earlier than 60 days after
the date of the optional redemp 'on or purchase, and the City shall promptly notify the Registrar
in writing of the manner in which the credit for the Term Bonds so redeemed or purchased has
• been allocated.
Any Bond in the principal amount of greater than$5,000 may be partially redeemed in
any integral multiple of$5,000.1iPrior to the Book-Entry Termination Date, Bonds shall be
partially redeemed in accordance with the Letter of Representations. From and after the Book-
:_ Entry Termination Date, in the event of a partial redemption of a Bond,upon surrender of such
Bond at the principal corporate trust office of the Registrar, a new Bond or Bonds (at the option
of the Owner) of the same maturity and interest rate and in the aggregate principal amount
remaining unredeemed shall be authenticated and delivered to the Owner, without charge to the
Owner for such partial redemption, in any denomination authorized by the Bond Ordinance and
• selected by the Owner.
Prior to the Book-Entry Termination Date, the Registrar shall give, or cause to be given,
notice of a call for redemption of any Bonds to the Custodian, as the Owner thereof, for the
benefit of the Beneficial Owners thereof, in accordance with the Letter of Representations. From
and after the Book-Entry Termination Date, notice of any such intended redemption shall be
given by or on behalf of the City not less than 3.0 nor more than 60 days prior to the date fixed
.
for redemption by first-class rrail,postage prepaid, to the Owner of each Bond to be redeemed at
P,
3
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,
I.
the address appearing on the BonRegister on the day the notice is mailed. The requirements of
i the Bond Ordinance shall be deemed to be complied with when notice is mailed as therein
provided, whether or not it is act4lly received by the Owner. If such notice has been given and
'~ the City has set aside sufficient mpney for the payment of all Bonds called for redemption on the
date fixed for redemption,the Bo ds so called shall cease to accrue interest after such
redemption date, and all such Bo r ds shall be deemed to be no longer outstanding under the Bond
Ordinance for any purpose, except that the Owners of such Bonds shall be entitled to receive
k payment of the redemption price rd interest accrued on the principal of the Bonds to the
g redemption date from the money et aside for such purpose.
This Bond and the other onds of this series are issued pursuant to and in full compliance
,r with the constitution and statutes of the State and pursuant to proceedings duly adopted by the
City, including, but not limited t ,the Bond Ordinance. The Bonds are issued for the purpose of
x providing part of the funds neces ary to pay the costs of constructing transportation and utility
>. infrastructure and improvements in the South Lake Washington Infrastructure project and the
SW 27th Street Extension project and to pay incidental costs thereof and the costs related to the
sale and issuance of the Bonds, all as provided in the Bond Ordinance.
.r The covenants contained/herein and in the Bond Ordinance may be discharged by making
t' provision, at any time, for the p ent of the principal of and interest on this Bond in the manner
provided in the Bond Ordinance)
X
M'
re Reference is made to the Bond Ordinance for other covenants and declarations of the City
E and other terms and conditions upon which this Bond has been issued,which terms and
conditions are made a part here if by this reference. The City unconditionally covenants that it
L, will keep and perform all of the covenants of this Bond and the Bond Ordinance.
E,
It is certified that all act , conditions and things required by the constitution and statutes
of the State to have happened,been done and performed precedent to and in the issuance of this
*.' Bond have happened,been done and performed, and that the issuance of this Bond does not
' violate any constitutional, statutory or other limitation upon the amount of indebtedness that the
City may incur.
t::
n.
# This Bond shall not be Yalid or become obligatory for any purpose unless and until the
4,T,
certificate of authentication hereon shall have been manually executed by an authorized
signatory of the Registrar.
t,- The City and the Regis rar, each in its discretion, may deem and treat the Owner hereof .
as the absolute owner hereof for all purposes, and neither the City nor the Registrar shall be
.; affected by any notice to the contrary.
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Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corp 9 ration("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any ce ificate issued is registered in the name of Cede& Co. or in
such other name as is requested b an authorized representative of DTC (and any payment is
r made to Cede&Co. or to such of er entity as is requested by an authorized representative of
DTC),ANY TRANSFER, PLED I E OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY IERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede& Co.,has an interest herein.
IN WITNESS WHEREOF,the City has caused this Bond to be executed with the manual
n signatures of its Mayor and City lerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 20 6.
CITY OF RENTON,WASHINGTON
���� ttm mnnauaf,,�,
����A OF RFS
By ' , , `�\& T�-
Y SEAL
May s* I [SEAL]
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By a&1 41 4 Ids / % ''°v, s �0.
City Clerk �irr.,i;,�►lru►initi:+a����°��
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F CER IFICATE OF AUTHENTICATION
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DATE OF AUTHENTICATIO I:
`i This Bond is one of the City ofenton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
t
ti WASHINGTON STATE FISCAL AGENCY,
Registrar
i' By
jAuthorized Signatory
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S ATEMENT OF INSURANCE
MBIA Insurance Corporation(the"Insurer")has issued a policy containing the following
provisions, such policy being on file at The Bank of New York,New York, New York.
The Insurer, in consideration of the payment of the premium and subject to the terms of
this policy, hereby unconditional) and irrevocably guarantees to any owner, as hereinafter
defined, of the following describ d obligations, the full and complete payment required to be
made by or on behalf of the Issue to The Bank of New York,New York,New York or its
successor(the"Paying Agent")o an amount equal to (i)the principal of(either at the stated
maturity or by any advancement i f maturity pursuant to a mandatory sinking fund payment) and
interest on, the Obligations(as th't term is defined below) as such payments shall become due
but shall not be so paid (except t at in the event of any acceleration of the due date of such
principal by reason of mandatory or optional redemption or acceleration resulting from default or
otherwise, other than any advanc ment of maturity pursuant to a mandatory sinking fund
• payment, the payments guarante d hereby shall be made in such amounts and at such times as
such payments of principal woul have been due had there not been any such acceleration, unless
the Insurer elects in its sole discr tion, to pay in whole or in part any principal due by reason of
such acceleration); and (ii)the r imbursement of any such payment which is subsequently
recovered from any owner pursu t to a final judgment by a court of competent jurisdiction that
such payment constitutes an avo dable preference to such owner within the meaning of any
applicable bankruptcy law. The amounts referred to in clauses(i) and(ii) of the preceding
sentence shall be referred to her in collectively as the"Insured Amounts." "Obligations"shall
mean:
$17,980,000
CIITY OF RENTON,WASHINGTON
LIMITED TAX GENERAL OBLIGATION BONDS, 2006
Upon receipt of t le h
po p e p me or telegraphic notice, such notice subsequently confirmed in
writing by registered or certifie l mail, or upon receipt of written notice by registered or certified
_. mail,by the Insurer from the Paying Agent or any owner of an Obligation the payment of an
Insured Amount for which is then due,that such required payment has not been made, the
Insurer on the due date of such payment or within one business day after receipt of notice of such
nonpayment, whichever is later, will make a deposit of funds, in an account with U.S. Bank
Trust National Association, inew York,New York, or its successor, sufficient for the payment
of any such Insured Amounts vrhich are then due. Upon presentment and surrender of such
Obligations or presentment of such other proof of ownership of the Obligations, together with
• any appropriate instruments oflassignment to evidence the assignment of the Insured Amounts
due on the Obligations as are paid by the Insurer, and appropriate instruments to effect the
appointment of the Insurer as agent for such owners of the Obligations in any legal proceeding
related to payment of Insured Amounts on the Obligations, such instruments being in a form
satisfactory to U.S. Bank Trust National Association, U.S. Bank Trust National Association shall
.disburse to such owners or the/Paying Agent payment of the Insured Amounts due on such
Obligations, less any amount held by the Paying Agent for the payment of such Insured Amounts
6
and legally available therefor. This policy does not insure against loss of any prepayment
premium which may at any timel7 payable with respect to any Obligation.
As used herein, the term"owner"shall mean the registered owner of any Obligation as
indicated in the books maintained by the Paying Agent, the Issuer, or any designee of the Issuer
for such purpose. The term owner shall not include the Issuer or any party whose agreement
with the Issuer constitutes the un erlying security for the Obligations.
Any service of process o the Insurer may be made to the Insurer at its offices located at
113 King Street,Armonk,New ork 10504 and such service of process shall be valid and
binding.
This policy is non-canes Table for any reason. The premium on this policy is not
refundable for any reason includi g the payment prior to maturity of the Obligations.
MB A INSURANCE CORPORATION
•
•
7
Y
•
ASSIGNMENT
For value received,the undersigned Owner(s) sell(s), assign(s) and transfer(s) unto:
(name, address and soial security or other identifying number of assignee)
the within-mentioned Bond and hereby irrevocably constitute(s) and appoint(s)
to transfer the same on the.Bond Register, with full power of substitution in the premises.
Owner(s)
NOTE: The signature(s) above must correspond with the name of the Owner(s) as it
appears on thb front of this Bond in every particular,without alteration or
enlargement or any change whatsoever.
Signature(s)guaranteed:
NOTE: Signatur-(s)must be guaranteed by an eligible guarantor.
g7 .
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede& Co. or to such other entity as is requested by an authorized representative of
DTC),ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY ERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede& Co., has an interest herein.
IN WITNESS WHEREO , the City has caused this Bond to be executed with the manual
signatures of its Mayor and City¶lerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON,WASHINGTON
\oout Unulllll oo..
OF Heilf,��i
Mayo
i. . SEAL *I
[SEAL]
/
By GSL LJGe.ksti.
City Clerk � mmumu
CE TIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATIO :
This Bond is one of the City ofiRenton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond O dinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
Fi
By
Authorized Signatory
5
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER,PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY ERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an interest herein.
IN WITNESS WHEREOIr, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August,2006.
CITY OF RENTON, WASHINGTON
\�.1 , *fey®/%
By MI e•
e`C.
Gate
* SEAL ! 1 [SEAL]
334 VC Al
By /,/�a �����Jete74-i
//� rep S
City Clerk � ��i�i�inrin►mtmn•\�
CERTIFICATE OF AUTHENTICATION
;k.
DATE OF AUTHENTICATIO :
This Bond is one of the City of/Renton,Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
r Registrar
By
Authorized Signatory
yP•
5
rr
r
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC(and any payment is
made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC),ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY I ERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an interest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON, WASHINGTON
By 0,45-ek eibtA RefrA
Mai
SE 4.
.
1 [SEAL]
By `rel \j. le/ ,ItmNnIJI}I114o������t
City Clerk
CERTIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton,Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
By
Authorized Signatory
5
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"),to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede&Co. or to such ither entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an interest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 206.
CITY OF RENTON, WASHINGTON
10M11""1 liUll„?I,r
By 4"e/ FP/
Mays SEAL
[SEAL]
'"
4.
By off• idage.prt-, TED s
City Clerk
CE TIFICATE OF AUTHENTICATION
f,
If
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton,Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
pa
5ry
By
Authorized Signatory
5
•
•
•
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"),to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an interest herein.
IN WITNESS WHERE9F, the City has caused this Bond to be executed with the manual
signatures of its Mayor and CitYl Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON, WASHINGTON
F `\��ttt4sti±ilillrrf;!,
By `i4/
Mayo
' SE , '` f' [SEAL]
By &'-'14.4/,(44 LlJ '7tr
E
-n00-��ti�``
City Clerk
,
CERTIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
:
This Bond is one of the City of Renton,Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
l' By
Authorized Signatory
1
•
5
3
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"),to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an inter st herein.
IN WITNESS WHERE F, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
• all as of the 1st day of August, 2006.
CITY OF RENTON, WASHINGTON
�Sj'�L 9
By 'eCa,"4, 4
OF
Mayo '_
[SEAL]
SEAL i'*==
�
By )60 Gde � /!:'F � ��\
City Clerk 4,1i4llctt ;Elt00
tk CERTIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
By
<' Authorized Signatory
,.a
tx
M1
ya-
5
rp
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede& Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede&Co. or to such gther entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co., has an inter st herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON, WASHINGTON
c:KBy �• � �„� ,
� F a
Mayor »» '
I-t SEAL W [SEAL]
By 4. (,Ui .✓ ,� if`, T;t9,-;
City Clerk • ���
33N
A'
CE TIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
t;
F.'
This Bond is one of the City of Renton,Washington, Limited Tax General Obligation Bonds,
I' 2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
By
E:i Authorized Signatory
6!i
wr
5
Ft,
.
tr • .
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"),to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede& Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede& Co. or to such o1lther entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co., has an interrt herein.
1n
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
w
CITY OF RENTON, WASHINGTON
„eon t ,'t-,i'!./tr,
0
;-: Y
'2"Ki rj ete-ei. ,, •,..•,-.-0.
. May.
r' = SEAL . [SEAL]
•
f By 60144/4Z4 l.(.)a ov ,//i ,TED.
..._._s.. ..00,
City Clerk
P'
J
F
5
A
t
4 CERTIFICATE OF AUTHENTICATION
`,.
Y:
DATE OF AUTHENTICATION:
•
,; This Bond is one of the City of Renton,Washington, Limited Tax General Obligation Bonds,
1, 2006, described in the Bond Ordinance.
bu
r rWASHINGTON STATE FISCAL AGENCY,
Registrar
'` By
Authorized Signatory
I
r
ilt •
F" 5
• •
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested y an authorized representative of DTC (and any payment is
made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC),ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANYI PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an intertest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON, WASHINGTON
By ` �� `{
May 4'1 SEAL '``r [SEAL]
0\ ex.
ACP,A h
40 1TED&-
tiollmingo
,'- City Clerk
• •
CERTIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
By
Authorized Signatory
c I
gk;
5
•
Unless this certificate is presented by an authorized representative of The Depository
• Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested�y an authorized representative of DTC (and any payment is
made to Cede&Co. or to such ther entity as is requested by an authorized representative of
DTC),ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
• OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an interest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON, WASHINGTON
By O: rj
•
Mayo
SEAL 1`d [SEAL]
By j• _ FL. v:�
it
City Clerk
Y •
CERTIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
•
s Registrar
By
k i Authorized Signatory
s.i
•
iw
[55x
of
E.
ii 5
f'�
•
t ,
,
•
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
f.. such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY(PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co., has an interest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and Cityl Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 006.
CITY OF RENTON, WASHINGTON
</1"1 - 's_ftoF
By Ma
[SEAL]
•
By )66L-0444,:a Nt.ses-
City
Clerk rrrrrruntlno!!liit0��"�
4'
CERTIFICATE OF AUTHENTICATION
r,.
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
33e3
Cr
By
Authorized Signatory
� I
ky
n�.
tt
S$
cf
iY
ix
tr
5
4-
4
l /
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
. made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER,PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY;PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an interest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and Cit} Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 006.
CITY OF RENTON,WASHIN TON
By '='ea
►P, Xto
Mayor
pA [SEAL]
/ is
/ ?
City Clerk
CE TIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton,Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
F
By
Authorized Signatory
a.-
7
a` 5
F
0.s
's
•
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested py an authorized representative of DTC (and any payment is
made to Cede&Co. or to such Other entity as is requested by an authorized representative of
i DTC),ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY' PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an inteiest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 1006.
CITY OF RENTON, WASHINGTON
By 4'rr •Via: •4
Ma wr 1 ' \
Ev.1SEAT
.YP [SEAL]
95
` ass,
By f, 'As=°�.
City Clerk �4r il.i.i;;.�:��it;ti<<��t:�e,-�
CE TIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
a
By
Authorized Signatory
P{0.'
i1x
5
aw
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede& Co. or to such other entity as is requested by an authorized representative of
DTC),ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede &Co., has an interest herein.
IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, 2006.
CITY OF RENTON, WASHINGTON
By c;eldtdi iatre e(C23' .
Mayo
5-7*1 . A a -. [SEAL]
e,
By dry22 (�J�� .�O-n-)
41)114mSli:illi t\
City Clerk
CERTIFICATE OF AUTHENTICATION
DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
By
Authorized Signatory
•
to
it
5
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"), to the Registrar for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede&Co. or in
such other name as is requested by an authorized representative of DTC (and any payment is
made to Cede& Co. or to such other entity as is requested by an authorized representative of
DTC),ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
hereof, Cede&Co.,has an interest herein.
IN WITNESS WHEREOF,the City has caused this Bond to be executed with the manual
signatures of its Mayor and Cityl Clerk, and a facsimile of the City seal to be imprinted hereon, •
Sis
all as of the 1st day of August,2006.
CITY OF RENTON,WASHINGTON
h By "S c .• \r✓i,
FSEAL [SEAL]
•
By637144-a:
City Clerk
ji
CERTIFICATE OF AUTHENTICATION
•
N DATE OF AUTHENTICATION:
This Bond is one of the City of Renton, Washington, Limited Tax General Obligation Bonds,
2006, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY,
Registrar
V'
By
Authorized Signatory •
ra
5
is . --
i
Unless this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation("DTC"),to the Registrar for registration of transfer,
exchange or payment, and any c&rtificate issued is registered in the name of Cede&Co. or in
• such other name as is requested by an authorized representative of DTC(and any payment is
"; made to Cede&Co. or to such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
as, OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered Owner
7:1'• hereof, Cede&Co.,has an interest herein.
h, IN WITNESS WHEREOF, the City has caused this Bond to be executed with the manual
signatures of its Mayor and City Clerk, and a facsimile of the City seal to be imprinted hereon,
all as of the 1st day of August, /006.
CITY OF RENTON, WASHINGTON
,, ,,, , ::;,,,„
By
Mayo
IP
'qL -li - [SEAL]
A. r J
By de-` ZIJGiQ .r% �8 ...., ;:
?,•. City Clerk
t.
o
2
w
CERTIFICATE OF AUTHENTICATION
0
6 DATE OF AUTHENTICATION:
This Bond is one of the City oRenton, Washington, Limited Tax General Obligation Bonds,
p 2006, described in the Bond Ordinance.
A
Er
I.' WASHINGTON STATE FISCAL AGENCY,
f Registrar
By
Authorized Signatory
itl
Li
,.
,;.„ .
,, ._
,,
G- 5
ri
„M .
-
do o; lind wado o; !Inc
From: Origin ID: (206)654-1999 Ship Date:17JUL06
Sue Selle
ActWgt:1 LB
Gottlieb,FSher&Andrews,PLLC t System#:6372011/INET2500
520 Pike Street,Suite 2510 Account#:S
REF:52-9 Renton
Seattle,WA 98101 CL337A8/n/2Z I 11111111 1111111111011 I 11111 III III I 1111111
SHIP TO: (206)654-1999 BILL SENDER Delivery Address Bar Code
. Judy Andrews
Gottlieb, Fisher&Andrews
520 Pike Street
----C - Suite_2510
Seattle, WA 98101
ci.)
PRIORITY OVERNIGHT TUE
gli r , ' I Deliver By:
� ' , TRK# 7919 9854 5280 FO 0'1 18JUL06
SEA Al
I '� 9 8101 -wa-us
w )' 81,1LKEA
e
TheJ11dQ,nTi2ñ
rOM1 ;® +`':;ate
' 3.`:':' fir,;;, "'`'.'
: >> r w ; y
' :� sir''*- a:1'-, E• .,' (:::v t': ��n, '�7 `� :..-.,,.�.�.._
^; p
1.:''':,:q I ';i k 9 l %',r y; ,��' 4
iv
� 4y'' '+� ,.....,q.,^ - �,,,J''> _ ,,r..»� ,:I :''. p'i Jl:L, '1/4 ''ti`�i�': '4A i" ';'k.
,,--zr-,7;1:.y,.. F, - _,r'' t ..- ,y 4 ted .`I
6'°c�5,f,
,
I
I
CITY OF'RENTON;WASHINGTON
ORDINANCE NO. 5215
AN ORDINANCE RELATING TO THE INCURRENCE OF
INDEBTEDNESS; PROVIDING FOR THE SALE AND
ISSUANCE OF LIMITED TAX GENERAL OBLIGATION
BONDS, 2006, IN THE AGGREGATE PRINCIPAL
AMOUNT OF $17,980,000 TO PROVIDE PART OF THE
COSTS OF CONSTRUCTING TRANSPORTATION AND
UTILITY INFRASTRUCTURE AND IMPROVEMENTS IN
THE CITY; PROVIDING FOR THE DATE,
DENOMINATI NS, FORM, TERMS, REGISTRATION
PRIVILEGES, MATURITIES, INTEREST RATES AND
COVENANTS OF THE BONDS; PROVIDING FOR THE
ANNUAL LE OF TAXES' TO PAY THE- PRINCIPAL
THEREOF 4ND THE INTEREST THEREON;
ESTABLISHING A DEBT SERVICE FUND FOR THE
BONDS; AND PROVIDING FOR THE SALE AND
DELIVERY OF SUCH BONDS TO D.A. DAVIDSON & CO.,
SEATTLE, WASHINGTON
WHEREAS, the City o Renton (the "City") has determined that there is a need for
infrastructure and other improvements for the South Lake Washington Infrastructure project and
the SW 27th Street Extensionproject and it is in the best interest of the residents of the City to
construct such roadway and utility, infrastructure improvements in the City; and
WHEREAS, the City Council deems-it to-be in the best interest of the City that the City
borrow money and issue and sell obligations in the form of limited tax general obligation bonds
for the purpose of providing part of the costs of the Project(hereinafter defined); and
WHEREAS, the incurrence of indebtedness by the City to pay the costs of the Project
will not cause the total indebtedne`s of the City to be incurred without the assent of the voters of
the City to exceed the limitations set forth in Chapter 39.36 RCW; and
•
ORDINANCE NO. 5215 L
WHEREAS, D.A. Davidson & Co. (the "Purchaser") has offered, by way of the Bond
Purchase Agreement (the "Purchase Agreement"), to purchase such limited tax general
obligation bonds upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON; DO ORDAIN AS FOLLOWS:
Section I. Finding, Purpose and Description of Bonds. The City authorizes the sale and
issuance of its "Limited Tax General Obligation Bonds, 2006" (the "Bonds") for the purpose of
providing part of the funds necessary to pay the costs of constructing transportation and utility
infrastructure and improvements in the South Lake Washington Infrastructure project and the
SW 276 Street Extension project, and to pay certain"incidental costs and costs related to the sale
and issuance"(as defined in RCW 39.46.070) of the Bonds (the"Project").
The Bonds shall be in the aggregate principal amount of $17,980,000; shall be dated
August 1, 2006; shall be issued in fully registered form as to both principal and interest; shall be
in the denomination of$5,000 each or any integral multiple thereof within a single maturity;
shall be numbered separately in such manner and with any additional designation as the fiscal
agencies of the State of Washington(the "State") located in Seattle, Washington and New York,
New York (collectively, the"Registrar"),may deem necessary for purpose of identification; shall
bear interest at the rates; and shall mature on December 1 in each of the years, in the principal
amounts, as set forth below:
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ORDINANCE NO. 5215
Maturity Date Principal Interest Rate
(December 1) Amount Per Annum
2008 $ 520,000 4.25%
2009 540,000 4.25
2010 565,000 3.90
2011 '585,000 4.25
2012 610,000 5.00
2013 640,000 4.50
2014 670,000 5.25
2015 700,000 5.25
2016 750,000 4.30
2017 775,000 5.00
2019* 1,670,000 5.00
2020 900,000 5.00
2021 945,000 5.00
2022 1,000,000 5.25
2023 1,040,000 5.25
2024 1,095,000 5.25
2028* 4,975,000 5.00
*Tenn Bonds
The Bonds shall bear interest (computed on the basis of a 360-day year of twelve 30-day
months) from their date or from the most recent interest payment date to which interest has been
paid or duly provided for, whichever is later, payable on December 1, 2006, and semiannually
thereafter on June 1 and December 1 of each year to the maturity or earlier redemption thereof.
If any Bond is not paid upon proper presentment at its maturity or redemption date, the City shall
be obligated to pay interest at the'i same rate from and after such maturity or earlier redemption
until such Bond,both principal and interest, is paid in full.
The Bonds shall be negotiable instruments to the extent'provided-by RCW 62A.8-102
and RCW 62A.8-105.
On the date of issue of the Bonds, all Bonds maturing in the same maturity year shall be
issued in the form of a single certificate, which certificate shall be registered in the name of The
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ORDINANCE NO. 5215
Depository Trust Company or any successor thereto engaged to operate a book-entry system for
recording the beneficial ownership of the Bonds, as Custodian(the"Custodian"), or its nominee,
and delivered to the Custodian. The Custodian shall hold each such Bond certificate in fully
immobilized form for the benefit of the beneficial owners of the Bonds (the "Beneficial
Owners") pursuant to the Blanket Issuer Letter of Representations (the "Letter of
Representations"), from the City and the Registrar to the Custodian pertaining to the payment of
the Bonds and the book-entry system, until the earliest to occur of either(1) the date of maturity
of the Bonds evidenced by such certificate, at which time the Custodian shall surrender such
certificate to the Registrar for payment of the principal of and interest on such Bonds coming due
on such date, and the cancellation thereof; (2) the fifth business day following the date of receipt
by the Registrar of the City's request to terminate the book-entry system of registering the
beneficial ownership of the Bonds (the"Book-Entry Termination Date"); or(3)the date the City
determines to utilize a new Custodian for the Bonds, at which time the old Custodian shall
(provided the City is not then in default of any payment then due on the outstanding Bonds)
surrender the immobilized certificates to the Registrar for transfer to the new Custodian and
cancellation as herein provided.
For so long as any outstanding Bonds are registered in the name of the Custodian or its
nominee and held by the Custodian in fully immobilized form as described in this Section II,the
rights of the Beneficial Owners shall be evidenced solely by an electronic and/or manual entry
made from time to time on the records established and maintained by the Custodian in
accordance with the Letter of Representations, and no certificates evidencing such Bonds shall
be issued and registered in the name of any Beneficial Owner or such Beneficial Owner's
nominee.
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ORDINANCE NO. 5215 J
The City may terminate the"book-entry" system of registering ownership of the Bonds at
any time (provided the City is not thenin default of any payment then due on the outstanding
Bonds) by delivering to the Registrar: (a) a written request that it issue and deliver Bond
certificates to each Beneficial Owner or such Beneficial Owner's nominee on the Book-Entry
Termination Date; (b) a list identifying the Beneficial Owners as to both name and address; and
(c) a supply of Bond certificates, if necessary for such purpose. Upon surrender to the Registrar
of the immobilized certificates evidencing all of the then outstanding Bonds, the Registrar shall
issue and deliver new certificates to each Beneficial Owner or such Beneficial Owner's duly
appointed agent, naming such Beneficial Owner or such Beneficial"Owner's nominee as the
registered owner (the "Owner") thereof. Such certificates may be in any integral multiple of
$5,000 within a single maturity. Following such issuance, the Owners of such Bonds may
transfer and exchange such Bonds in accordance with Section IX hereof.
Neither the City nor the Registrar shall have at any time any responsibility or liability to
any Beneficial Owner of any Bonds or to any other personfor any error, omission, action or
failure to act on the part of the Custodian with respect to payment, when due, to the Beneficial
Owner of the principal and interest on the Bonds, proper recording of beneficial ownership of
Bonds, proper transfers of such be eficial ownership, or any notices to Beneficial Owners or any
other matter pertaining to the Bonds.
I
Section II. Place, Manner and Medium of Payment. Both the principal of and interest
I
on the Bonds shall be payable in "lawful money of the United States of America. Prior to the
Book-Entry Termination Date, the principal and interest on the Bonds shall be paid by the
1
Registrar to the Custodian as the Owner thereof, for the benefit of the Beneficial Owners thereof,
in accordance with the Letter of Representations.
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ORDINANCE NO. 5215
From and after the Book-Entry Termination Date, interest on the Bonds shall be paid by
check or draft mailed on or before the interest payment date, to the persons identified as the
Owners on the fifteenth day of the month preceding the interest payment date at the addresses
shown for the Owners on the registration books for the Bonds (the "Bond Register") maintained
by the Registrar; provided, however, that if so requested in writing by the Owner of at least
$1,000,000 principal amount of Bonds, interest will be paid by wire transfer on the interest
payment date to an account with a bank located in the United States. From and after the Book-
Entry Termination Date, principal of the Bonds shall be payable upon presentation and surrender
of the Bonds by the Owners at the principal corporate trust office of the Registrar.
Section III. Redemption; Open Market Purchase. The Bonds maturing on December 1,
2019 and 2028 are term bonds (the "Term Bonds") and, if not previously purchased by the City
in the open market or optionally redeemed as set forth below, are subject to mandatory sinking
fund redemption in part and by lot (insuch manner as the Registrar shall determine), at par plus
accrued interest to the redemption date on December 1 in the following years and in the
following mandatory sinking fund redemption amounts:
Mandatory Sinking Fund
Redemption Dates Mandatory Sinking Fund
(December 1) Redemption Amounts
2018 $ 815,000
2019* 855,000
2025 1,155,000
2026 1,210,000
2027 1,275,000
2028* 1,335,000
*Scheduled maturity
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ORDINANCE NO. 5215
The Bonds maturing on December 1 in the years 2008 through 2016, inclusive, shall not
I
be subject to redemption prior to maturity. The Bonds maturing on or after December 1, 2017
shall be subject to optional redemption prior to maturity beginning on December 1, 2016, in
whole or in part at any time (maturities to be selected by the City and by lot within a maturity in
such manner as the Registrar' shall determine), at par plus accrued interest to the date of
redemption. If the City shall pptionally redeem Term Bonds or purchase Term Bonds in the
open market, the par amount oil the Term Bonds so redeemed or purchased (irrespective of their
actual redemption or purchase pl ces) shall be credited against one or more scheduled mandatory
redemption amounts for such Term Bonds (as allocated by the City) beginning not earlier than
60 days after the date of the optional redemption or purchase, and the City shall promptly notify
the Registrar in writing of the manner in which the credit for the Term Bonds so redeemed or
purchased has been allocated.
Any Bond in the principal amount of greater than $5,000 may be partially redeemed in
any integral multiple of$5,000. Prior to the Book-Entry Termination Date, the Bonds shall be
partially redeemed in accordance with the Letter of Representations. From and after the Book-
Entry Termination Date, in the event of a partial redemption of a Bond, upon surrender of such
Bond at the principal corporate trust office of the Registrar, a new Bond or Bonds (at the option
of the Owner) of the same maturity and interest rate and in the aggregate principal amount
remaining unredeemed shall be authenticated and delivered to the Owner, without charge to the
Owner for such partial redemption, in any denomination authorized by this Ordinance and
selected by the Owner.
Prior to the Book-Entry Termination Date, the Registrar shall give, or cause to be given,
notice of a call for redemption of I any Bonds to the Custodian, as the Owner thereof, for the
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ORDINANCE NO. 5215
benefit of the Beneficial Owners thereof, in accordance with the Letter of Representations. From
and after the Book-Entry Termination Date, notice of any such intended redemption shall be
given by or on behalf of the City not less than 30 nor more than 60 days prior to the date fixed
for redemption by first-class mail, postage prepaid, to the Owner of each Bond to be redeemed at
the address appearing on the Bond Register on the day the notice is given. The requirements of
this section shall be deemed to be complied with when notice is mailed as herein provided,
whether or not it is actually received by the Owner. In addition, such redemption notice shall be
mailed within the same time period, postage prepaid, to each then existing nationally recognized
municipal securities information repository designated by the SEC ("NRMSIR"), to the State
Information Depository ("SID"), if one is created, and to MBIA Insurance Corporation (the
"Bond Insurer") or their respective successors, but such mailings shall not be a condition
precedent to the redemption of such Bonds.
If such notice to the Owners shall have been given and the City shall have set aside
sufficient money for the payment of all Bonds called for redemption on the date fixed for
redemption, the Bonds so called shall cease to accrue interest after such redemption date, and all
such Bonds shall be deemed not to be outstanding hereunder for any purpose, except that the
Owners of such Bonds shall be entitled to receive payment of the redemption price and interest
accrued on the principal of the Bonds to the redemption date from the money set aside for such
purpose.
The City reserves the right to purchase any or all of the Bonds on the open market at any
time and at any price.
All Bonds purchased or redeemed by the City shall be surrendered to the Registrar for
cancellation.
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ORDINANCE NO. 5215
Section IV. Debt Limit Not Exceeded. The City finds and covenants that the Bonds are
issued within all constitutional and statutory debt limitations presently applicable to the City.
Section V. Pledge of Full Faith, Credit and Resources. The Bonds are limited tax
general obligations of the City. Unless the principal of and interest on the Bonds are paid from
other sources, so long as any Bonds are outstanding, the City hereby irrevocably covenants to
include in its budgets and to make annual levies of taxes within the constitutional and statutory
tax limitations provided by law without a vote of the qualified voters of the City upon all
property within the City subject to taxation in amounts which, together with any other money
legally available therefor, shall be sufficient to pay the principal and interest on the Bonds as the
same shall become due. The City hereby irrevocably pledges its full faith, credit and resources
to the annual levy and collectiorof such taxes and for the prompt payment of such principal and
I
interest. All of such taxes shall be paid into the Bond Fund hereinafter created.
Section VI. Form of Bonds. The Bonds shall be typewritten, printed or lithographed on
good bond paper in a form consistent with this Ordinance and State law.
Section VII. Execution of Bonds. The Bonds shall be signed on behalf of the City with
the facsimile or manual signatures of the Mayor and the City Clerk, and shall have the seal of the
City impressed or a facsimile thereof imprinted thereon.
In case either or both of the officers who shall have executed any Bond shall cease to be
such officer or officers of the City before the Bond so signed shall have been authenticated or
delivered by the Registrar or issued by the City, such Bond nevertheless may be authenticated,
delivered and issued and upon such authentication, delivery and issuance, shall be as binding
upon the City as though those who jsigned the same had continued to be such officers of the City.
Any Bond also may be signed and attested on behalf of the City by such persons as at the actual
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ORDINANCE NO. 5215
date of execution of such Bond shall be the proper officers of the City although at the original
date of such Bond such persons were not such officers of the City.
Section VIII. Authentication and Delivery of Bonds by Registrar. The Registrar is
authorized and directed, on behalf of the City, to authenticate and deliver Bonds initially issued
or transferred or exchanged in accordance with the provisions of such Bonds and this Ordinance.
Only such Bonds as shall bear thereon a "Certificate of Authentication" manually
executed by an authorized signatory of the Registrar shall be valid or obligatory for any purpose
or entitled to the benefits of this 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.
The Registrar shall be responsible for its representations contained in the Certificate of
Authentication on the Bonds.
Section IX. Registration; Transfer and Exchange. The Registrar shall keep, or cause to
be kept, the Bond Register at its principal corporate trust office.
The City and the Registrar, each in its discretion, may deem and treat the Owner of each
Bond as the absolute owner thereof for all purposes, and neither the City nor the Registrar shall
be affected by any notice to the contrary. Payment of any such Bond shall be made only as
described in Section II hereof, but such registration may be transferred as herein provided. All
such payments made as provided in Section II hereof shall be valid and shall satisfy and
discharge the liability of the City upon such Bond to the extent of the amount or amounts so
paid.
The registered ownership of any Bond may be transferred. Prior to the Book-Entry
Termination Date, the beneficial ownership of the Bonds may only be transferred on the records
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ORDINANCE NO. 5215 C.
established and maintained by the Custodian. On and after the Book-Entry Termination Date, no
l
transfer of any Bond shall be valid unless it is surrendered at any principal corporate trust office
of the Registrar, with the assignment form appearing on such Bond duly executed by the Owner •
or such Owner's duly authorized agent, in a manner satisfactory to the Registrar. Upon such
surrender, the Registrar shall cancel the surrendered Bond and shall authenticate and deliver,
without charge to the Owner or transferee therefor (other than governmental fees or taxes
payable on account of such transfer), a new Bond or Bonds (at the option of the new Owner), of
the same maturity and interest rate and for the same aggregate principal amount, in any
authorized denomination, namig as Owner the person or persons listed as the assignee on the
assignment form appearing on the surrendered Bond, in exchange for such surrendered and
cancelled Bond.
On and after the Book-Entry Termination Date, any Bond may be surrendered at the
principal corporate trust office of the Registrar and exchanged, without charge, for an equal
aggregate principal amount of Bonds, in any authorized denomination. The Registrar shall not
be obligated to transfer or exchange any Bond during the 15 days preceding any applicable
interest payment,principal payment or redemption date.
The Registrar may become the Owner of any Bond with the same rights it would have if
it were not the Registrar and,to dr extent permitted by law, may act as depository for and permit
any of its officers or directors to act as a member of, or in any other capacity with respect to, any
committee formed to protect the rights of the Owners of the Bonds.
The City covenants that, until all Bonds shall have been surrendered and cancelled, it will
i
maintain a system of recording the ownership of each Bond that complies with the provisions of
the Internal Revenue Code of 1986, as amended(the"Code").
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ORDINANCE NO. 5215 '
Section X. Mutilated, Lost, Stolen or Destroyed Bonds. If any Bond becomes mutilated,
lost, stolen or destroyed, the Registrar may authenticate and deliver a new Bond of the same
maturity and interest rate and of like tenor and effect in substitution therefor, all in accordance
with law. If such mutilated, lost, stolen or destroyed Bond has matured, the City at its option,
may pay the same without the surrender thereof. However, no such substitution or payment shall
be made unless and until the applicant shall furnish (a) evidence satisfactory to the Registrar of
the destruction or loss of the original Bond and of the ownership thereof, and (b) such additional
security, indemnity or evidence as may be required by or on behalf of the City. No substitute
Bond shall be furnished unless the applicant shall reimburse the City and the Registrar for their
respective expenses in the furnishing thereof. Any such substitute Bond so furnished shall be
equally and proportionately entitled to the security of this Ordinance with all other Bonds issued
hereunder.
Section XL Defeasance. If money and/or "Government Obligations" (as such
obligations are defined in Chapter 39.53 RCW, as now in existence or hereafter amended)
maturing at such times(s) and bearing such interest to be earned thereon (without any
reinvestment thereof) as will provide a series of payments which shall be sufficient, together
with any money initially deposited, to provide for the payment of all of the principal of and
interest on all or a portion of the Bonds, when due in accordance with their terms in accordance
with a refunding plan adopted by the City, are set aside in a special fund (hereinafter called the
"trust account") to effect such payment and are pledged irrevocably for the purpose of effecting
such payment, then no further payments need be made into the Bond Fund for the payment of the
principal of and the interest on such Bonds, the Owners thereof shall cease to be entitled to any
lien, benefit or security of this Ordinance except for the right to receive the money and the
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ORDINANCE NO. 5215
principal and interest proceed' on the obligations set aside in the trust account, and such Bonds
shall no longer be deemed to be outstanding hereunder.
Section XII. Sale of the Bonds; Delivery. The Purchaser has presented a bond purchase
agreement (the "Purchase Agreement") to the City pursuant to which the Purchaser has offered
to purchase the Bonds, under the terms and conditions provided in the Purchase Agreement,
which written Purchase Agreement is on file with the City Clerk and is incorporated herein by
this reference. The City Council finds that entering into the Purchase Agreement is in the City's
best interest and therefore accepts the offer contained in the Purchase Agreement and authorizes
the execution of the Purchase Agreement by the Mayor, her designee, the Chief Administrative
Officer of the City or the Finance and Information Services Administrator.
The Bonds will be prepared at City expense and will be delivered to the Purchaser in
accordance with the terms of the Purchase Agreement with the approving legal opinion of
Gottlieb, Fisher & Andrews, PLLC, bond counsel, Seattle, Washington, relative to the issuance
of the Bonds, printed on or attached to each Bond. Bond counsel has not been engaged to
participate in the preparation or review of, or express any opinion concerning the completeness
or accuracy of, any official statement or other disclosure documentation used in connection with
the offer or sale of the Bonds by any person, and bond counsel's opinion shall so state. Bond
counsel has not been retained to monitor, and shall not be responsible for monitoring, the City's
compliance with any federal law Or regulations to maintain the tax-exempt status of the interest
on.the Bonds.
Section XIII. Delivery of Bonds: Temporary Bonds. The proper City officials,
including, but not limited to, the City Finance and Information Services Administrator, are
authorized and directed to execute and/or approve, as appropriate, all documents, including but
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ORDINANCE NO. 5215
not limited to, the final Official Statement pertaining to the Bonds and the commitment from the
Bond Insurer for the issuance of an insurance policy for the Bonds, and to do everything
necessary for the preparation and delivery of a transcript of proceedings pertaining to the Bonds,
and the printing, execution and prompt delivery of the Bonds to the Purchaser and for the proper
application and use of the proceeds of the sale thereof.
If definitive Bonds are not ready for delivery by the date established for closing (the
"Closing"), the City Finance and Information Services Administrator, upon the approval of the
Purchaser, may cause to be issued and delivered to the Purchaser one or more temporary Bonds
with appropriate omissions, changes and additions. Any temporary Bond or Bonds shall be
entitled and subject to the same benefits and provisions of this Ordinance with respect to the
payment, security and obligation thereof as definitive Bonds authorized hereby. Such temporary
Bond or Bonds shall be exchangeable without cost to the Owners thereof for definitive Bonds
when the latter are ready for delivery.
Section XIV. Establishment of Bond Fund; Application of Bond Proceeds. There is
hereby created and established in the office of the City Finance and Information Services
Administrator a special fund to be designated as the "Limited Tax General Obligation Bond
Fund, 2006" (the"Bond Fund").
The accrued interest on the Bonds, if any, received by the City upon the sale of the Bonds
shall be deposited into the Bond Fund and shall be applied to the payment of interest coming due
on the Bonds.
The remaining proceeds of the sale of the Bonds, less the underwriter's discount and plus
the net original issue premium, shall be deposited, upon receipt, to the "South Lake Washington
14
ORDINANCE NO. 5215 ,
Infrastructure Project Fund" (the "Project Fund"), established in the office of the City Finance
and Information Services Administrator, to pay part of the costs of the Project.
Except as provided b the Code and Section XV of this Ordinance, the interest and
profits derived from the investment of Bond proceeds shall be deposited in the Project Fund and
applied as described in the preceding paragraph.
Except as provided b the Code and Section XV of this Ordinance, if any money
allocable to the Bond proceeds remains in the Project Fund after payment of all the costs of the
Project or'after termination of the Project by the City, such money shall be transferred to the
Bond Fund and applied to the payment of the principal of and interest on the Bonds.
I
Pending application as described in this Section XIV and subject to the requirements of
the Code and Section XV of this Ordinance,money allocable to the Bond proceeds in the Project
Fund may be temporarily deposited in such institutions or invested in such investments as may
be lawful for the investment of City funds.
Section XV. Tax-Exemption Covenants. The City covenants that it will not take or
permit to be taken on its behalf any action that would adversely affect the exclusion of the
interest on the Bonds from the gross income for purposes of federal income taxation, and will
take or require to be taken such acts as may be permitted by Washington law and as may from
time to time be required under applicable law to continue the exclusion'of the interest on the
Bonds from the gross income for purposes of federal income taxation. Without limiting the
generality of the foregoing, the City will not invest or make or permit any use of the proceeds of
the Bonds or of its other money at any time during the term of the Bonds which would cause the
Bonds to be"arbitrage bonds"within the meaning of-Section 148 of the Code.
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ORDINANCE NO. 5215
The City covenants that it shall calculate or cause to be calculated, and shall rebate to the
United States, all earnings from the investment of Bond proceeds that are in excess of the
amount that would have been earned had the yield on such investments been equal to the yield
on the Bonds, plus income derived from such excess earnings, to the extent and in the manner
required by Section 148 of the Code.
The City has not been notified of any listing or proposed listing by the Internal Revenue
Service to the effect that the City is a bond issuer the arbitrage certifications of which may not be
relied upon.
The City will take no actions and will make no use of the proceeds of the Bonds or any
other funds held under this Ordinance which would cause any Bond to be treated as a "private
activity bond" (as defined in Section 141(b) of the Code) subject to treatment under said
Section 141(b) as an obligation not described in Section 103(a) of the Code, unless the tax
exemption thereof is not affected.
Section XVI. Preliminary Official Statement Declaration. The City has been provided
with copies of a preliminary official statement dated July 5, 2006, (the "Preliminary Official
Statement"), prepared in connection with the sale of the Bonds. For the sole purpose of the
Purchaser's compliance with Securities and Exchange Commission Rule 15c2-12(b)(1), the City
"deems final" the Preliminary Official Statement, as of its date, except for the omission of
information on offering prices, interest rates, selling compensation, delivery dates, ratings, other
terms of the Bonds dependent on such matters.
Section XVII. Undertaking to Provide Continuing Disclosure. This section constitutes
the City's written undertaking for the benefit of the Owners and Beneficial Owners of the Bonds
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ORDINANCE NO. 5215
required by subsection (b)(5)(i) of the Rule 15c2-12 (the "Rule") of the United States Securities
and Exchange Commission(the"SEC").
f
The City hereby agrees to provide or cause to be provided to each then existing
NRMSIR, to the SID, if one is created, and to the Bond Insurer the following annual financial
information and operating data (collectively, the "Annual Financial Information") for each prior
fiscal year, commencing with the fiscal year ending December 31, 2006, on or before the last day
of the seventh month following the end of such prior fiscal year:
(a) Annual financial statements prepared in accordance with the generally
accepted accounting principles applicable to governmental units, as such principles may
be changed from time to time and as permitted by State law; which statements will not be
audited, except that if and when audited financial statements are otherwise prepared and
available to the City,they will be provided(the"Annual Financial Statements");
(b) The assessed valuation of taxable property in the City;
(c) Ad valorem taxes due and the percentages of taxes collected;
(d). Property tax levy rates per$1,000 assessed valuation;
(e) A statement of authorized, issued and outstanding general obligation
indebtedness of the City; and
I
I
(f) A narrative explanation of the reasons for any amendments to this
Section XVII made during the previous fiscal year and the impact of such amendments
on the Annual Financial Information being provided.
In its provision of such financial information and operating data, the City may cross-
reference to any "final official statement" (as defined in the Rule) available from the Municipal
f
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ORDINANCE NO. 5215
Securities Rulemaking Board (the "MSRB") documents theretofore provided to each then
existing NRMSIR or the SID, if one is created, and to the Bond Insurer.
If not submitted as part of the Annual Financial Information, then when and if available,
the City shall provide its Annual Financial Statements, which shall have been audited by such
auditor as shall be then required or permitted by the State law, to each then existing NRMSIR, to
the SID, if one is created.
The City further agrees to provide or cause to be provided, in a timely manner, to the
SID, if one is created, and to either the MSRB or each then existing NRMSIR and to the Bond
Insurer,notice of any of the following events with respect to the Bonds, if material:
1. Principal and interest payment delinquencies;
2. Non-payment related defaults;
3. Unscheduled difficulties;
4. Unscheduled draws on credit enhancements reflecting financial
difficulties;
5. Substitution of credit or liquidity providers, or their failure to perform;
6. Adverse tax opinions or events affecting the tax-exempt status of the
Bonds;
7. Modification to rights of the Owners of the Bonds;
8. Optional redemptions of the Bonds;
9. Defeasances of the Bonds;
10. Release, substitution or sale of property securing repayment of the Bonds;
and
11. Rating changes.
The City also agrees to provide or cause to be provided, in a timely manner, to the SID, if
one is created, and to either the MSRB or each then existing NRMSIR, notice of its failure to
18
ORDINANCE NO. 5215
provide the Annual Financial Information for the prior fiscal year on or before the last day of the
seventh month following the end of such prior fiscal year.
After the issuance of the Bonds, so long as the interests of the Owners or Beneficial
Owners of the Bonds will not be materially impaired thereby,.as determined by aart
p Y
unaffiliated with the City (including, without limitation, a trustee for the Owners, nationally
recognized bond counsel or other counsel familiar with the federal securities law), or pursuant to
a favorable "no-action letter" issued by the SEC, this Section XVII may only be amended in
connection with any change in legal requirements, change in law, or change in the identity,
nature or status of the obligated person,or type of business conducted, and only in such a manner
that the undertaking of the City; as so amended, would have complied with the requirements of
the Rule at the time of the p I'mary offering, after taking into account any amendments or
interpretations of the Rule, as well as any change in circumstances.
The City's obligations to provide Annual Financial Information and notices of certain
events shall terminate without amendment upon the defeasance, prior redemption or payment in
full of all of the then outstanding Bonds. This Section XVII or any provision hereof, shall be
null and void if the City (i) obtains an opinion of nationally recognized bond counsel or other
counsel familiar with the federal! securities laws to the effect that those portions of the Rule
which require this Section XVII or any such provision are invalid, have been repealed
retroactively or otherwise do not apply to the Bonds; and (ii)notifies and provides the SID, if
any, and either the MSRB or each then existing NRMSIR with copies of such opinion.
The right of each Owner or' Beneficial Owner of Bonds to enforce the provisions of this
Section XVII shall be limited to the right to obtain specific enforcement of the City's obligations
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ORDINANCE NO. 5215
under this Section XVII, and any failure by the City to comply with the provisions of this
undertaking shall not be a default with respect to the Bonds under this Ordinance.
The City Finance and Information Services Administrator is authorized and directed to
take such further action on behalf of the City as may be necessary, appropriate or convenient to
carry out the requirements of this Section XVII.
Section XVIII. Contract; Severability. The covenants contained in this Ordinance shall
constitute a contract between the City and the Owners of each and every Bond. The City
unconditionally covenants that it will keep and perform all of the covenants of the Bonds and this
Ordinance. If any one or more of the provisions of this Ordinance shall be declared
unconstitutional or invalid for any reason, such decision shall not affect the validity of the
remaining provisions of this Ordinance or the Bonds, and this Ordinance and the Bonds shall be
construed and enforced as if such unconstitutional or invalid provision had not been contained
herein.
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.
ORDINANCE NO. 5215
Section XIX. Effective Date. This Ordinance shall take effect and be in force five days
from and after its passage andpublication as provided by law.
PASSED BY THE CITY COUNCIL this 17th day of July, 2006.
Bonnie I. Walton, City Clerk
APPROVED BY THE MAYOR this 17th'..day of July , 2006.
K//WI
Kathy Keo. er, Mayor
Approved as to form: I ' "' :::‘>\,\
n1y *:i
B nd Counsel T ''' V)
CO
* WOW 0.Q
Date of Publication: 7/21/2006 (summary) ''''''•"''•••'•"''..',
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July 17,2006 Renton City Council Minutes Page 250
Public Safety Committee Public Safety Committee Chair Law presented a report recommending
Community Services: Disaster concurrence in the staff recommendation to approve a joint agreement and
Relief Supply Building, Fire memorandum of understanding with King County Fire Protection District#25
District#25 &American Red and the American Red Cross, serving King and Kitsap Counties, to provide a
Cross process for the American Red Cross to construct, equip, and maintain a disaster
relief supply building, funded by a grant from the Boeing Employees Fund, for
the purpose of housing local disaster relief supplies. The Committee
recommended that the Mayor and City Clerk be authorized to sign the
agreement and memorandum.*
Councilman Law pointed out that this is a great opportunity for Renton, as this
area of the County lacks such a facility. He stated that the building will be
located at Fire Station#16, and the City will not incur any of the costs.
*MOVED BY LAW, SECONDED BY NELSON, COUNCIL CONCUR IN
THE COMMITTEE REPORT. CARRIED.
RESOLUTIONS AND The following ordinance was presented for first reading and referred to the .
ORDINANCES Council meeting of 8/7/2006 fo;second and final reading:
EDNSP: Annexation An ordinance was read amending the 2006 Budget by transferring funds in the
Community Outreach, PRR amount of$70,000 from the 2005 year-end fund balance for the purpose of
Contract,Budget Amend public information and community outreach efforts related to annexation and
incorporation, with$60,087 going to PRR, Inc. to conduct that work, and
declaring an emergency. MOVED BY BRIERE, SECONDED BY NELSON,
COUNCIL REFER THE ORDINANCE FOR SECOND AND FINAL
READING ON 8/7/2006. CARRIED.
The following ordinances were presented for second and final reading and .
adoption:
Ordinance#5214 An ordinance was read vacating four portions of right-of-way, a total of
Vacation: Park Ave N, City of approximately 21,795 square feet, along Park Ave.N. between N. 8th St. and
Renton, VAC-04-005 Logan Ave.N. for the proposed "The Landing" site development street system
(City of Renton;VAC-04-005). MOVED BY BRIERE, SECONDED BY
LAV, COUNCIL ADOPT THE ORDINANCE AS READ. ROLL CALL:
ALL AYES. CARRIED.
Ordinance#5215 An ordinance was read relating to the incurrence of indebtedness;providing for
Finance: Bond Issuance, S the sale and issuance of Limited Tax General Obligation Bonds,2006, in the
Lake WA Infrastructure& SW aggregate principal amount of$17,980,000 to provide part of the costs of
27th St/Strander Blvd constructing transportation and utility infrastructure and improvements in the
Extension Projects City;providing for the date, denominations, form, terms, registration privileges,
maturities, interest rates and covenants of the bonds;providing for the annual
levy of taxes to pay the principal thereof and the interest thereon; establishing a
debt service fund for the bonds; and providing for the sale and delivery of such
bonds to D.A. Davidson &Co., Seattle, Washington. MOVED BY
CLAWSON, SECONDED BY BRIERE, COUNCIL ADOPT THE
ORDINANCE AS READ.*
Finance and Information Services Administrator Michael Bailey introduced
Fred Eoff,Managing Underwriter with D.A. Davidson&Co., and Lindsay
Sovde,Financial Advisor with Seattle Northwest Securities,who both spoke on
the topic of the bond issuance. Mr. Eoff reported on the City's bond credit
•
rating,pointing out that both credit rating services, Fitch Rating Services and
Standard and Poor's, took a fresh look at the City's economic status and
increased their credit ratings for the City from A+to AA-. He noted that the
July 17,2006 Renton City Council Minutes Page 251
increased credit ratings resulted in an improvement to the bond insurance
premiums and interest rates.
Ms. Sovde stated that Seattle Northwest Securities worked as financial advisor
on the bond transaction. She indicated that the bond sale went very well, that
the bonds were priced fairly in the market, and that the fee charged by the
underwriter was fair.
*ROLL CALL: ALL AYES. MOTION CARRIED.
Chief Administrative Officer Jay Covington stated that the City's credit rating
increase will result in savings to the taxpayers. Mayor Keolker noted that the
rating upgrade will positively affect how others view Renton as a place to
invest.
NEW BUSINESS Council President Corman reported a discussion with a Maplewood Glen
Public Works: Neighborhood neighborhood resident who informed him that the post office, instead of
Mail Box Stations delivering the mail to residents' houses, is installing postal stations. He
conveyed that the resident is concerned about the placement of the postal
stations, as their placement may cause traffic flow and site distance problems,
and block parking and front yards. Pointing out that this is a widespread
•
problem,Mr. Corman asked that the Administration contact the post office to
try to become part of the planning process for the locating of postal stations.
Mayor Keolker said she will communicate the concerns to the post office.
Finance: City Web Site Councilwoman Palmer reported that she and Councilmembers Briere and
Update, City Logo Corman had an opportunity to preview the City's new web site last week. She
pointed out that the web site looks great, is easy to use and navigate, and is easy
for staff to update. However, Ms. Palmer stated her surprise to see a new City
logo on the site. She pointed out that discussion occurred two years ago
rega ding a new logo, and it was decided at the time,partially due to monetary
reasons,not to go forward with the effort.
MOPED BY PALMER, SECONDED BY PERSSON, COUNCIL STOP USE
OF 11HE NEW CITY LOGO AND REFER THE ITEM TO COMMITTEE OF
THE WHOLE.*
• Discussion ensued regarding the logo on the new web site, and the City's
existing logo. Councilwoman Briere explained that the logo was developed as
part of the web site,but noted that the City is not yet at the point of changing
the City logo. She discussed the opportunity the web site provided to start on a
path of updating the City logo at no cost to the City,the reason why she got
involved with the web site update project, the lack of a consistent design on
City publications, and the cost savings of having a consistent look.
Councilmembers Clawson,Law,Nelson, Persson, and Corman discussed the
importance of the City logo, and the need for Council review of a City logo
change. The comments pertained to the involvement of citizens in a City logo
redesign process, the costs associated with changing the logo, staying with the
existing logo or adding it to the new web site, the confusion about what is the
official City logo, the decision-making authority for logo changes,the lack of
notice regarding a new logo on the new web site, and making changes to the
new web site.
Mayor Keolker discussed the freshening of the look of the web site,the delay
this action will cause in the launching of the new web site, the changes that will
be necessary, and that the launch of the web site and the City logo are separate
issues.
II
1y '`A RECEIVEd
JUL X10 2006
tiVY O FINANCE AND INFORMATION SERVIE
a DEPARTME TiV~City COUNCIL
+ � N
‘e.‘NTO M E M O R A N D U M cmr of RNToN
{ AUG O..2 2006
DATE: July 10,2006 RECEIVED
TO: Randy Corman, Council President (QTY()LEFIIf's OFFICE
Members of the Renton City Council
CC: Kathy Keolker,Mayor
FROM: Mike Bailey, Administrat.r--
SUBJECT: Preliminary Official Statements
lova, Iv% bDrd c,1,,
Attached is a copfof the"Preliminary Official Statement"described in the Committee of
the Whole meeting. This version is the one supplied to the bond market and D.A.
Davidson&Co.provided extra copies.
It is for your use as you see flit. We will have a"Final Official Statement" available after
the sale that includes interest rates and other details of the sale.
Please let me know if you have questions.
I .
C:\DOCUME-1 UMEDZE—'1\LOCALS-1\Temp\POS.doc
(�, 1 RECEIVEd
JUL 'i 71006
(c N�
FINANCE
E AND INFORMATION
RMATION SY
° ryC• ® � CouN
CII44 DEPARTMENT+
RENTO( MEMORANDUM CITYOF
DATE: July
17, 2006 JUL 1 7 •
2006
TO: Randy, Corman, Council President !
VED
M mbers of the Renton City Council CITY CLERK'S OFFICE
CC: Kathy Keolker,Mayor
Jay Covington, Chief Administra 've Officer
FROM: Mike Bailey,FIS Administrato
SUBJECT: 2006 Bond Sale-Final Transaction Information
•
The 2006 Limited Tax General Obligation Bonds were available for pricing and pre-sale
orders last Thursday, July 13. The pricing went well and the following information is
provided to assist you in final consideration of the bond ordinance this evening.
Interest rate and structure:
The"True Interest Cost"is 4.686%
The structure will be level debt service(declining interest and increasing principle) for
the full term. The first year(2007)will be interest only payments while The Landing is
under construction and becomes productive.
We did respond to market interest and create two term bonds in 2019 and 2028. The debt
service payments by the City will remain unchanged.
We did increase the interest rates on the bonds and sold the bonds at a premium. The net
effect to the city is the same i but the purchasers of the bonds use this approach to hedge
against increasing interest rates.
The total amount of premium to be paid to the city is $660,506,which results in the need
to sell fewer bonds. In addition, we applied the grant to be received from the EDA to a
reduction in the bond size. As a result, the total issue size dropped to $17,980,000.
The bond market also was more comfortable having bond insurance on this transaction.
As a result, we are recommending the bid from MBIA, one of the major insurers in the
marketplace. The analysis suggests a net savings of about$40,000 after the cost of the
insurance premium.
H:\FINANCE\ADMINSUP\02_IssuePapers_memos to Council or Mayor\Council memo re bond ordinance
adoption.doc
Randy Corman,Council
Page 2 of 2
July 17,2006
As an aside, the insurance market did reduce the premium by$28,000 upon word of the
City's bond rating increase. In addition, we believe that the rates reflect about a 2 basis-
point improvement as a result of the rating change, another$27,100, for a total of about
$55,10.0 savings related to the improved rating.
Recommendation:
• I recommend the City Council approve the ordinance with the changes described above,
that the City Council accept the offer to'purchase the bonds by D.A. Davidson&Co.
This transaction was closely monitored by the financial advisor hired for this bond sale.
The financial advisor concurs with this recommendation.
MEB/dlf
cc: Marty Wine,Assistant to the CAO
Bonnie Walton,City Clerk
Alex Pietsch,EDNSP Administrator
Gregg Zimmerman,PB/PW Administrator
•
h:\finance\adminsup\02_issuepapers_memos to council or mayor\council memo re bond ordinance adoption.doc
July 10,2006 Renton City Council Minutes Page 240
The following ordinances were presented for first reading and referred to the
Council meeting of 7/17/2006 for second and final reading:
Vacation: Park Ave N, City of An ordinance was read vacating four portions of right-of-way, a total of
Renton, VAC-04-005 approximately 21,795 square feet, along Park Ave. N. between N. 8th St. and
Logan Ave. N. for the proposed "The Landing" site development street system
(City of Renton; VAC-04-005). MOVED BY CLAWSON, SECONDED BY
NELSON, COUNCIL REFER THE ORDINANCE FOR SECOND AND
FINAL READING ON 7/17/2006. CARRIED.
Finance:,Bot_j_Issuance, S An'ordinance was read relating to the incurrence of indebtedness;providing for
Lake WA Infrastructure& SW the sale and issuance of Limited Tax General Obligation Bonds,2006, to
27th St/Strander Blvd provide part of the costs of constructing transportation and utility infrastructure
Extension Projects and improvements in the City; providing for the date, denominations, form,
terms, registration privileges,maturities, interest rates and covenants of the
bonds;providing for the annual levy of taxes to pay the principal thereof and
the interest thereon; establishing a debt service fund for the bonds; and
providing for the sale and delivery of such bonds to D.A. Davidson & Co.,
Seattle, Washington. MOVED BY LAW, SECONDED BY PERSSON,
COUNCIL REFER THE ORDINANCE FOR SECOND AND FINAL
READING ON 7/17/2006. CARRIED.
NEW BUSINESS Referring to a previous speaker's comments (Mr. Walker) regarding the Sir
Planning: Sir Cedric Cedric Condominium redevelopment, Councilman Clawson stated that these
Condominium Redevelopment, types of higher density residences are affordable to many people, and the City
Highlands Area sho i ld keep this in mind when looking at rezoning the Highlands area.
AUDIENCE COMMENT Sandel DeMastus,Highlands Community Association(HCA) Vice President,
Citizen Comment: DeMastus - PO Box 2041, Renton, 98056, commented that the HCA was one of the groups
Fireworks Ban, Victim of that Isupported the City's ban on fireworks, and noted that she heard very few
Attack at Residence fireworks this year. Additionally,Ms. DeMastus expressed her desire that more
police officers be assigned to the Highlands area, saying that had there been
more officers in the area, someone may have noticed her attacker entering her
house.
Citizen Comment: Petersen- Inezi Petersen,PO Box 2041, Renton, 98056, indicated that she is the secretary
Various of the Highlands Community Association(HCA) even though she does not live
in the neighborhood. She explained that she has close ties to the neighborhood,
and he works hard for the community. On another topic,Ms. Petersen
suggested that citizens groups be allowed to make presentations at Committee
of the Whole, or some other venue, where they are not restricted by the five-
minute audience comment rule. Additionally, she suggested that the following
requirements be considered the next time the City's travel policy is reviewed:
justification for the trip and a trip report.
ADJOURNMENT MOVED BY PERSSON, SECONDED BY NELSON, COUNCIL ADJOURN.
CARRIED. Time: 9:09 p.m.
Bonnie I. Walton, CMC, City Clerk •
Recorder: Michele Neumann
July 10,2006
• July 10,2006 Renton City Council Minutes Page 239
Appeal: Lake WA/May Creek City Clerk reported appeal of Hearing Examiner's decision regarding the Lake
Dredging Permit, Barbee Mill Washington/May Creek dredging permit application; appeal filed on 6/8/2006
Company, SP-05-138 by Barbee Mill Company, represented by Michael Lloyd,Lloyd &Associates,
Inc., 38210 SE 92nd St., Snoqualmie,98056, accompanied by required fee.
Refer to Planning and Development Committee.
Community Services: Disaster Community Services Department recommended approval of a joint agreement
Relief Supply Building, Fire and memorandum of understanding with King County Fire Protection District
District#25 &American Red #25 and the American Red Cross, serving King and Kitsap Counties,
Cross concerning the disaster relief supply building and its supplies. Refer to Public
Safety Committee.
Development Services: Finseth Development Services Division recommended acceptance of a deed of
Short Plat, ROW Dedication, dedication for additional right-of-way at Morris Ave. S. to fulfill a requirement
Morris Ave S, SHP-05-027 of the Finseth Short Plat. Council concur.
Development Services: Pelton Development Services Division recommended acceptance of a deed of
NE 20th St Short Plat, ROW dedication for additional right-of-way at the corner of Edmonds Ave.NE and
Dedication, SHP-05-119 NE 2,0th St. to fulfill a requirement of the Pelton NE 20th St. Short Plat.
Council concur.
Development Services: Annies Development Services Division recommended acceptance of a deed of
Place II Short Plat, ROW dedication for additional right-of-way at the corner of Lyons Ave.NE and NE
Dedication, Lyons Ave NE, 2nd St. to fulfill a requirement of the Annie's Place II Short Plat. Council
SHP-05-167 concur.
Finance: Bond Issuance, S Finance and Information Services Department requested approval of an
Lake WA Infrastructure& SW ordinance authorizing the issuance of Limited Tax General Obligation Bonds in
27th St/Strander Blvd the amount of$20,665,000 for constructing transportation and utility
Extension Projects infrastructure improvements for the South Lake Washington and the SW 27th
St. and Strander Blvd. projects. Council concur.
OVED BY NELSON, SECONDED BY PERSSON, COUNCIL APPROVE
THE CONSENT AGENDA AS PRESENTED. CARRIED.
UNFINISHED BUSINESS Utilities Committee Chair Clawson presented a report recommending
Utilities Committee concurrence in the staff recommendation to authorize the Mayor and City Clerk
Utility: Sanitary Sewer Flows, to execute an interlocal agreement with Skyway Water and Sewer District to
Skyway Water and Sewer allow for the conveyance of a portion of the district's flow through the City's
District system. The Committee further recommended that the resolution regarding this
matter be presented for reading and adoption. MOVED BY CLAWSON,
SECONDED BY LAW, COUNCIL CONCUR IN THE COMMITTEE
REPORT. CARRIED. (See later this page for resolution.)
Finance Committee Finance Committee Chair Persson presented a report recommending approval of
Finance: Vouchers Claim Vouchers 249943 -250357 and two wire transfers totaling
$3,310,151.65; and approval of Payroll Vouchers 64061 - 64424, one wire
transfer, and 635 direct deposits totaling$2,101,203.45. MOVED BY
PERSSON,SECONDED BY LAW, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
RESOLUTIONS AND The following resolution was presented for reading and adoption:
ORDINANCES
Resolution #3827 A resolution was read authorizing the Mayor and City Clerk to enter into an
Utility: Sanitary Sewer Flows, interlocal agreement with the Skyway Water and Sewer District to provide,
Skyway Water and Sewer within the subject area, the option of the district connecting its sewer facilities
District to Renton's sewer facilities. MOVED BY CLAWSON, SECONDED BY LAW,
COUNCIL ADOPT THE RESOLUTION AS READ. CARRIED.
Y OF RENTON COUNCIL AGENL HILL
t
AI#: d.!
Submitting Data: For Agenda of:
Dept/Div/Board.. Finance &IS Department July 10, 2006
Staff Contact Mike Bailey,Administrator Agenda Status
Consent X
Subject: Public Hearing..
Correspondence..
Limited Tax General Obligation Bonds Ordinance X
Resolution
Old Business
Exhibits: j New Business
Issue Paper Study Sessions
Draft Ordinance Information
Recommended Action: Approvals:
Council concur Legal Dept
Finance Dept
Other
Fiscal Impact:
Expenditure Required... Transfer/Amendment
Amount Budgeted Revenue Generated
Total Project Budget City Share Total Project..
i
SUMMARY OF ACTION:
The ordinance permits the City of Renton to sell $20,665,000 in new Limited Tax General
Obligation Bonds, 2006, to provide part of the costs of constructing transportation and utility
infrastructure and improvements in the City.
STAFF RECOMMENDATION:
Adopt bond ordinance.
H:\FINANCE\ADMINSUP\Ol_AgendaBills\Bond,LTGO July 2006.doc
`SY ‘f FINANCE AND INFORMATION SERVICES
C.) ® DEPARTMENT
♦ •
.11
`e'P�N�o� MEMORANDUM
DATE: Jun 26, 2006
TO: Randy Corman, Council President
Members of the Renton City Council
VIA: Kat i y Keolker,Mayor �-+
FROM: Mike Bailey, Administrator
SUBJECT: Limited Tax General Obligation Bonds
ISSUE:
Should the Council adopt an ordinance permitting the sale of$20,665,000 in Limited
Tax General Obligation Bonds, 2006, to provide part of the costs of constructing
transportation and utility infrastructure and improvements in the City?
RECOMMENDATION:
Adoption of the proposed ordinance authorizing the issuance of the bonds and related
activities, and accept the offer to purchase the bonds from D.A. Davidson and Company.
BACKGROUND SUMMARY:
Use and Amount of Bond Proceeds
The City Council approved al development agreement with The Boeing Company in 2003
providing for City participation in public improvements related to redevelopment of
property. The Boeing Company sold the property and their rights under the development
agreement to Transwestern Harvest Lakeshore LLC. Subsequently, the City approved a
development agreement with Transwestern Harvest Lakeshore LLC (THL) in April of
2006 specifying certain obligations and conditions related to the development of this
property.
Among the conditions was a requirement that THL demonstrate evidence of
commitments to the development by June 12. This condition was met.
The City accepted the bid of Ceccanti to construct the infrastructure improvements on
June 19. A project budget of$24,925,587 was approved for the infrastructure
improvements on June 26. Qf this budget, $16,605,809 is to be provided by the proceeds
from a sale of Limited Tax General Obligation Bonds.
H:\FINANCE\ADMINSUP\02_IssuePapers memos to Council or Mayor\Bond Issue,LTGO,2006.doc
Randy Corman,Council Pi int
Members of the Renton Cit; juncil
June 26,2003
Page 2 of 2
In addition to the use of bonds for improvements related to the development agreement
with THL,the City is making roadway improvements on SW 27th and Strander Blvd.
These improvements will be paid for by a variety of sources, including$2.8 million in
proceeds from the bonds. The total proposed bond amount is $20,665,000 as illustrated
in the table below:
SW Lake Washington Improvements(THL agreement) $16,600,000
SW 27th and Strander Blvd. Improvements 2,800,000
Capitalized Interest 1,079,061
Bond Insurance Premium 67,570
Cost of Issuance 206,650
Bond Premium Proceeds (88,281)
Total Bond Issue $20,665,000
Bond Sale
Staff recommends acceptance of the offer to purchase the bonds from the City made by
D.A. Davidson&Company(Purchaser),the managing underwriter. Staff will make a
brief presentation at the final adoption of the recommended ordinance to review the offer
provided by the Purchaser for the purpose of illustrating the market rates and final
changes to the elements of the sale determined at pricing. Pricing will occur on July 13.
To assist the Council in assessing the offer to purchase the bonds,we have secured the
services of Seattle Northwest Securities as the financial advisor to the City. An expert in
the municipal bond market will be present at the City Council meeting of July 17 to
advise the City Council with regard to the market and specific elements of the bond sale.
CONCLUSION:
Staff recommends adoption of the ordinance authorizing the sale of the bonds and the
acceptance of the offer to purchase the bonds from D.A. Davidson & Company.
MEB/dlf
cc: Jay Covington,CAO
Marty Wine,Assistant to the CAO
Alex Pietsch,EDNSP Administrator
Gregg Zimmerman,PB/PW Administrator
Bonnie Walton,City Clerk
1St DRAFT 5/26/06
For Discussion Purposes Only
CITY OF RENTON,WASHINGTON
ORDINANCE NO.
AN ORDINANCE RELATING TO THE INCURRENCE OF
INDEBTEDNESS; PROVIDING FOR THE SALE AND
ISSUANCE OF LIMITED TAX GENERAL OBLIGATION
BONDS, 2006, TO PROVIDE PART OF THE COSTS OF
CONSTRUCTING TRANSPORTATION AND UTILITY
INFRASTRUCTURE AND IMPROVEMENTS IN THE CITY;
PROVIDING FOR THE DATE, DENOMINATIONS, FORM,
TERMS, REGISTRATION PRIVILEGES, MATURITIES,
INTEREST RATES AND COVENANTS OF THE BONDS;
PROVIDING FOR THE ANNUAL LEVY OF TAXES TO PAY
THE PRINCIPAL THEREOF AND THE INTEREST THEREON;
ESTABLISHING A DEBT SERVICE FUND FOR THE BONDS;
AND PROVIDING FOR THE SALE AND DELIVERY OF
SUCH BONDS ATO D.A. DAVIDSON & CO., SEATTLE,
WASHINGTON
WHEREAS,the City of Renton(the "City")has determined that there is a need for
infrastructure and other improvements for the South Lake Washington Infrastructure project and
the SW 27th Street Extension project and it is in the best interest of the residents of the City to
construct such roadway and utility infrastructure improvements in the City; and
WHEREAS, the City Council deems it to be in the best interest of the City that the City
borrow money and issue and sell obligations in the form of limited tax general obligation bonds
for the purpose of providing part of the costs of the Project(hereinafter defined); and
WHEREAS,the incurrence of indebtedness by the City to pay the costs of the Project
will not cause the total indebtedness of the City to be incurred without the assent of the voters of
the City to exceed the limitations 'set forth in Chapter 39.36 RCW; and
WHEREAS, D.A. Davidson& Co. (the"Purchaser")has offered, by way of the Bond
Purchase Agreement(the "Purchase Agreement"), to purchase such limited tax general
obligation bonds upon the terms and conditions hereinafter set forth;NOW, THEREFORE,
THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON, DO ORDAIN
AS FOLLOWS:
Section 1. Finding, Purpose and Description of Bonds. The City authorizes the sale and
issuance of its "Limited Tax General Obligation Bonds, 2006"(the"Bonds") for the purpose of
providing part of the funds necessary to pay the costs of constructing transportation and utility
infrastructure and improvements in the South Lake Washington Infrastructure project and the
SW 27th Street Extension project, and to pay certain"incidental costs and costs related to the sale
and issuance"(as defined in RCW 39.46.070) of the Bonds (the "Project").
f:\renton\Itgo 2006 1
1st DRAFT 5/26/06
ror Discussion Purposes Only
The Bonds shall be in the aggregate principal amount of$ ; shall be dated
August 1,2006; shall be issued in fully registered form as to both principal and interest; shall be
in the denomination of$5,000 each or any integral multiple thereof within a single maturity;
shall be numbered separately in such manner and with any additional designation as the fiscal
agencies of the State of Washington(the "State") located in Seattle, Washington and New York,
New York (collectively, the"Registrar"), may deem necessary for purpose of identification; shall
bear interest at the rates; and shall mature on December 1 in each of the years, in the principal
amounts, as set forth below:
Maturity Date Principal Interest Rate
(December 1) Amount Per Annum
2008 $
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
[*Term Bonds]
The Bonds shall bear interest(computed on the basis of a 360-day year of twelve 30-day
months) from their date or from the most recent interest payment date to which interest has been
paid or duly provided for, whichever is later,payable on December 1, 2006, and semiannually
thereafter on June 1 and December 1 of each year to the maturity or earlier redemption thereof.
If any Bond is not paid upon proper presentment at its maturity or redemption date, the City shall
be obligated to pay interest at the same rate from and after such maturity or earlier redemption
until such Bond,both principal and interest, is paid in full.
The Bonds shall be negotiable instruments to the extent provided by RCW 62A.8-102
and RCW 62A.8-105.
f:\renton\ltgo 2006 2
1St DRAFT 5/26/06
For Discussion Purposes Only
On the date of issue of the Bonds, all Bonds maturing in the same maturity year shall be
issued in the form of a single certificate,which certificate shall be registered in the name of The
Depository Trust Company or any successor thereto engaged to operate a book-entry system for
recording the beneficial ownership of the Bonds, as Custodian(the"Custodian"), or its nominee,
and delivered to the Custodian. The Custodian shall hold each such Bond certificate in fully
immobilized form for the benefit of the beneficial owners of the Bonds (the `Beneficial
Owners")pursuant to the Blanket Issuer Letter of Representations(the "Letter of
Representations"), from the City and the Registrar to the Custodian pertaining to the payment of
the Bonds and the book-entry system, until the earliest to occur of either(1) the date of maturity
of the Bonds evidenced by such certificate, at which time the Custodian shall surrender such
certificate to the Registrar for payment of the principal of and interest on such Bonds coming due
on such date, and the cancellation thereof; (2)the fifth business day following the date of receipt
by the Registrar of the City's request to terminate the book-entry system of registering the
beneficial ownership of the Bonds (the"Book-Entry Termination Date"); or(3)the date the City
determines to utilize a new CustoIdian for the Bonds, at which time the old Custodian shall
(provided the City is not then in default of any payment then due on the outstanding Bonds)
surrender the immobilized certificates to the Registrar for transfer to the new Custodian and
cancellation as herein provided.
For so long as any outstanding Bonds are registered in the name of the Custodian or its
nominee and held by the Custodian in fully immobilized form as described in this Section 2, the
rights of the Beneficial Owners shall be evidenced solely by an electronic and/or manual entry
made from time to time on the records established and maintained by the Custodian in
accordance with the Letter of Representations, and no certificates evidencing such Bonds shall
be issued and registered in the name of any Beneficial Owner or such Beneficial Owner's
nominee.
The City may terminate the "book-entry" system of registering ownership of the Bonds at
any time(provided the City is no then in default of any payment then due on the outstanding
Bonds)by delivering to the Registrar: (a) a written request that it issue and deliver Bond
certificates to each Beneficial Owner or such Beneficial Owner's nominee on the Book-Entry
Termination Date; (b) a list identifying the Beneficial Owners as to both name and address; and
(c) a supply of Bond certificates,iif necessary for such purpose. Upon surrender to the Registrar
of the immobilized certificates evidencing all of the then outstanding Bonds,the Registrar shall
issue and deliver new certificates,to each Beneficial Owner or such Beneficial Owner's duly
appointed agent,naming such Beneficial Owner or such Beneficial Owner's nominee as the
registered owner(the"Owner")thereof. Such certificates may be in any integral multiple of
$5,000 within a single maturity. Following such issuance, the Owners of such Bonds may
transfer and exchange such Bonds in accordance with Section 9 hereof.
Neither the City nor the Registrar shall have at any time any responsibility or liability to
any Beneficial Owner of any Borids or to any other person for any error, omission, action or
failure to act on the part of the Custodian with respect to payment,when due, to the Beneficial
Owner of the principal and interest on the Bonds, proper recording of beneficial ownership of
Bonds,proper transfers of such beneficial ownership, or any notices to Beneficial Owners or any
other matter pertaining to the Bonds.
f:\renton\ltgo 2006 3
1st DRAFT 5/26/06
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Section 2. Place,Manner and Medium of Payment. Both the principal of and interest on
the Bonds shall be payable in lawful money of the United States of America. Prior to the Book-
Entry Termination Date, the principal and interest on the Bonds shall be paid by the Registrar to
the Custodian as the Owner thereof, for the benefit of the Beneficial Owners thereof, in
accordance with the Letter of Representations.
From and after the Book-Entry Termination Date, interest on the Bonds shall be paid by
check or draft mailed on or before the interest payment date,to the persons identified as the
Owners on the fifteenth day of the month preceding the interest payment date at the addresses
shown for the Owners on the registration books for the Bonds (the"Bond Register") maintained
by the Registrar;provided,however, that if so requested in writing by the Owner of at least
$1,000,000 principal amount of Bonds, interest will be paid by wire transfer on the interest
payment date to an account with a bank located in the United States. From and after the Book-
Entry Termination Date, principal of the Bonds shall be payable upon presentation and surrender
of the Bonds by the Owners at the principal corporate trust office of the Registrar.
Section 3. Redemption; Open Market Purchase. [The Bonds maturing on December 1,
are term bonds (the "Term Bonds") and, if not previously purchased by the City in the open
market or optionally redeemed as set forth below, are subject to mandatory sinking fund
redemption in part and by lot(in such manner as the Registrar shall determine), at par plus
accrued interest to the redemption date on December 1 in the following years and in the
following mandatory sinking fund redemption amounts:
Mandatory Sinking Fund Mandatory
Redemption Dates Sinking Fund
(December 1) Redemption Amounts
*Scheduled maturity]
The Bonds maturing on December 1 in the years 2008 through 2016, inclusive, shall not
be subject to redemption prior to maturity. The Bonds maturing on or after December 1, 2017
shall be subject to optional redemption prior to maturity beginning on December 1, 2016, in
whole or in part at any time(maturities to be selected by the City and by lot within a maturity in
such manner as the Registrar shall determine), at par plus accrued interest to the date of
redemption. [If the City shall optionally redeem Term Bonds or purchase Term Bonds in the
open market, the par amount of the Term Bonds so redeemed or purchased (irrespective of their
actual redemption or purchase prices) shall be credited against one or more scheduled mandatory
redemption amounts for such Term Bonds (as allocated by the City)beginning not earlier than
60 days after the date of the optional redemption or purchase, and the City shall promptly notify
the Registrar in writing of the manner in which the credit for the Term Bonds so redeemed or
purchased has been allocated.]
Any Bond in the principal amount of greater than $5,000 may be partially redeemed in
any integral multiple of$5,000. Prior to the Book-Entry Termination Date, the Bonds shall be
f:\renton\ltgo 2006 4
1St DRAFT 5/26/06
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partially redeemed in accordance with the Letter of Representations. From and after the Book-
Entry Termination Date, in the event of a partial redemption of a Bond, upon surrender of such
Bond at the principal corporate trust office of the Registrar, a new Bond or Bonds (at the option
of the Owner) of the same maturity and interest rate and in the aggregate principal amount
remaining unredeemed shall be authenticated and delivered to the Owner, without charge to the
Owner for such partial redemption, in any denomination authorized by this Ordinance and
selected by the Owner.
Prior to the Book-Entry Termination Date, the Registrar shall give, or cause to be given,
notice of a call for redemption ofany Bonds to the Custodian, as the Owner thereof, for the
benefit of the Beneficial Owners thereof, in accordance with the Letter of Representations. From
and after the Book-Entry Termination Date,notice of any such intended redemption shall be
given by or on behalf of the City not less than 30 nor more than 60 days prior to the date fixed
for redemption by first-class mail, postage prepaid, to the Owner of each Bond to be redeemed at
the address appearing on the Bond Register on the day the notice is given. The requirements of
this section shall be deemed to be complied with when notice is mailed as herein provided,
whether or not it is actually received by the Owner. In addition, such redemption notice shall be
mailed within the same time period,postage prepaid,to each then existing nationally recognized
municipal securities information repository designated by the SEC ("NRMSIR"),to the State
Information Depository("SID"), if one is created, and to (the
"Bond Insurer") or their respective successors,but such mailings shall not be a condition
precedent to the redemption of such Bonds.
If such notice to the Owners shall have been given and the City shall have set aside
sufficient money for the payment of all Bonds called for redemption on the date fixed for
redemption, the Bonds so called shall cease to accrue interest after such redemption date, and all
such Bonds shall be deemed not to be outstanding hereunder for any purpose, except that the
Owners of such Bonds shall be entitled to receive payment of the redemption price and interest
accrued on the principal of the Bonds to the redemption date from the money set aside for such
purpose.
The City reserves the right to purchase any or all of the Bonds on the open market at any
time and at any price.
All Bonds purchased or redeemed by the City shall be surrendered to the Registrar for
cancellation.
Section 4. Debt Limit Not Exceeded. The City finds and covenants that the Bonds are
issued within all constitutional and statutory debt limitations presently applicable to the City.
Section 5. Pledge of Full Faith, Credit and Resources. The Bonds are limited tax general
obligations of the City. Unless the principal of and interest on the Bonds are paid from other
sources, so long as any Bonds are outstanding, the City hereby irrevocably covenants to include
in its budgets and to make annual levies of taxes within the constitutional and statutory tax
limitations provided by law without a vote of the qualified voters of the City upon all property
within the City subject to taxation in amounts which,together with any other money legally
available therefor, shall be sufficient to pay the principal and interest on the Bonds as the same
f:\renton\tgo 2006 5
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shall become due. The City hereby irrevocably pledges its full faith,credit and resources to the
annual levy and collection of such taxes and for the prompt payment of such principal and
interest. All of such taxes shall be paid into the Bond Fund hereinafter created.
Section 6. Form of Bonds. The Bonds shall be typewritten,printed or lithographed on
good bond paper in a form consistent with this Ordinance and State law.
Section 7. Execution of Bonds. The Bonds shall be signed on behalf of the City with the
facsimile or manual signatures of the Mayor and the City Clerk, and shall have the seal of the
City impressed or a facsimile thereof imprinted thereon.
In case either or both of the officers who shall have executed any Bond shall cease to be
such officer or officers of the City before the Bond so signed shall have been authenticated or
delivered by the Registrar or issued by the City, such Bond nevertheless may 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 also may 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 such persons were not such officers of the City.
Section 8. Authentication and Delivery of Bonds by Registrar. The Registrar is
authorized and directed, on behalf of the City, to authenticate and deliver Bonds initially issued
or transferred or exchanged in accordance with the provisions of such Bonds and this Ordinance.
Only such Bonds as shall bear thereon a"Certificate of Authentication"manually
executed by an authorized signatory of the Registrar shall be valid or obligatory for any purpose
or entitled to the benefits of this 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.
The Registrar shall be responsible for its representations contained in the Certificate of
Authentication on the Bonds.
Section 9. Registration; Transfer and Exchange. The Registrar shall keep, or cause to be
kept,the Bond Register at its principal corporate trust office.
The City and the Registrar, each in its discretion, may deem and treat the Owner of each
Bond as the absolute owner thereof for all purposes, and neither the City nor the Registrar shall
be affected by any notice to the contrary. Payment of any such Bond shall be made only as
described in Section 2 hereof,but such registration may be transferred as herein provided. All
such payments made as provided in Section 2 hereof shall be valid and shall satisfy and
discharge the liability of the City upon such Bond to the extent of the amount or amounts so
paid.
The registered ownership of any Bond may be transferred. Prior to the Book-Entry
Termination Date, the beneficial ownership of the Bonds may only be transferred on the records
established and maintained by the Custodian. On and after the Book-Entry Termination Date,no
f:\rentonutgo 2006 6
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transfer of any Bond shall be valid unless it is surrendered at any principal corporate trust office
of the Registrar,with the assignment form appearing on such Bond duly executed by the Owner
or such Owner's duly authorized agent, in a manner satisfactory to the Registrar. Upon such
surrender, the Registrar shall cancel the surrendered Bond and shall authenticate and deliver,
without charge to the Owner or transferee therefor(other than governmental fees or taxes
payable on account of such transfer), a new Bond or Bonds (at the option of the new Owner), of
the same maturity and interest rate and for the same aggregate principal amount, in any
authorized denomination,naming as Owner the person or persons listed as the assignee on the
assignment-form appearing on the surrendered Bond, in exchange for such surrendered and
cancelled Bond.
On and after the Book-Entry Termination Date, any Bond may be surrendered at the
principal corporate trust office of lithe Registrar and exchanged,without charge, for an equal
aggregate principal amount of Bonds, in any authorized denomination. The Registrar shall not
be obligated to transfer or exchange any Bond during the 15 days preceding any applicable
interest payment,principal payment or redemption date.
The Registrar may become the Owner of any Bond with the same rights it would have if
it were not the Registrar and, to the extent permitted by law, may act as depository for and permit
any of its officers or directors to act as a member of, or in any other capacity with respect to, any
committee formed to protect the rights of the Owners of the Bonds.
The City covenants that, until all Bonds shall have been surrendered and cancelled, it will
maintain a system of recording the ownership of each Bond that complies with the provisions of
the Internal Revenue Code of 1986' as amended (the "Code").
Section 10. Mutilated, Lost, Stolen or Destroyed Bonds. If any Bond becomes
mutilated, lost, stolen or destroyed, the Registrar may authenticate and deliver a new Bond of the
same maturity and interest rate and of like tenor and effect in substitution therefor, all in
accordance with law. If such mutilated, lost, stolen or destroyed Bond has matured,the City at
its option,may pay the same without the surrender thereof. However, no such substitution or
payment shall be made unless and until the applicant shall furnish(a) evidence satisfactory to the
Registrar of the destruction or loss of the original Bond and of the ownership thereof, and
(b) such additional security, indemnity or evidence as may be required by or on behalf of the
City. No substitute Bond shall be furnished unless the applicant shall reimburse the City and the
Registrar for their respective expenses in the furnishing thereof. Any such substitute Bond so
furnished shall be equally and proportionately entitled to the security of this Ordinance with all
other Bonds issued hereunder.
Section 11. Defeasance. If money and/or"Government Obligations" (as such
obligations are defined in Chapter'39.53 RCW, as now in existence or hereafter amended)
maturing at such times(s) and bearing such interest to be earned thereon(without any
reinvestment thereof) as will provide a series of payments which shall be sufficient, together
with any money initially deposited, to provide for the payment of all of the principal of and
interest on all or a portion of the Bonds,when due in accordance with their terms in accordance
with a refunding plan adopted by the City, are set aside in a special fund (hereinafter called the
"trust account") to effect such payment and are pledged irrevocably for the purpose of effecting
f:\renton\Itgo 2006 7
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such payment, then no further payments need be made into the Bond Fund for the payment of the
principal of and the interest on such Bonds, the Owners thereof shall cease to be entitled to any
lien,benefit or security of this Ordinance except for the right to receive the money and the
principal and interest proceeds on the obligations set aside in the trust account, and such Bonds
shall no longer be deemed to be outstanding hereunder.
Section 12. Sale of the Bonds; Delivery. The Purchaser has presented a bond purchase
agreement(the"Purchase Agreement")to the City pursuant to which the Purchaser has offered
to purchase the Bonds,under the terms and conditions provided in the Purchase Agreement,
which written Purchase Agreement is on file with the City Clerk and is incorporated herein by
this reference. The City Council finds that entering into the Purchase Agreement is in the City's
best interest and therefore accepts the offer contained in the Purchase Agreement and authorizes
the execution of the Purchase Agreement by the Mayor, her designee,the Chief Administrative
Officer of the City or the Finance and Information Services Administrator.
The Bonds will be prepared at City expense and will be delivered to the Purchaser in
accordance with the terms of the Purchase Agreement with the approving legal opinion of
Gottlieb, Fisher&Andrews, PLLC,bond counsel, Seattle, Washington, relative to the issuance
of the Bonds,printed on or attached to each Bond. Bond counsel has not been engaged to
participate in the preparation or review of, or express any opinion concerning the completeness
or accuracy of, any official statement or other disclosure documentation used in connection with
the offer or sale of the Bonds by any person, and bond counsel's opinion shall so state. Bond
counsel has not been retained to monitor, and shall not be responsible for monitoring,the City's
compliance with any federal law or regulations to maintain the tax-exempt status of the interest
on the Bonds.
Section 13. Delivery of Bonds; Temporary Bonds. The proper City officials, including,
but not limited to,the City Finance and Information Services Administrator, are authorized and
directed to execute and/or approve, as appropriate, all documents, including but not limited to,
the final Official Statement pertaining to the Bonds and the commitment from the Bond Insurer
for the issuance of an insurance policy for the Bonds, and to do everything necessary for the
preparation and delivery of a transcript of proceedings pertaining to the Bonds, and the printing,
execution and prompt delivery of the Bonds to the Purchaser and for the proper application and
use of the proceeds of the sale thereof.
If definitive Bonds are not ready for delivery by the date established for closing(the
"Closing"), the City Finance and Information Services Administrator, upon the approval of the
Purchaser,may cause to be issued and delivered to the Purchaser one or more temporary Bonds
with appropriate omissions, changes and additions. Any temporary Bond or Bonds shall be
entitled and subject to the same benefits and provisions of this Ordinance with respect to the
payment, security and obligation thereof as definitive Bonds authorized hereby. Such temporary
Bond or Bonds shall be exchangeable without cost to the Owners thereof for definitive Bonds
when the latter are ready for delivery.
Section 14. Establishment of Bond Fund and Project Fund; Application of Bond
Proceeds. There is hereby created and established in the office of the City Finance and
f:lrenton\ltgo 2006 8
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Information Services Administrator a special fund to be designated as the "Limited Tax General
Obligation Bond Fund, 2006"(the"Bond Fund").
The accrued interest on the Bonds, if any,received by the City upon the sale of the Bonds
shall be deposited into the Bond Fund and shall be applied to the payment of interest coming due
on the Bonds.
The remaining proceeds of the sale of the Bonds, less the underwriter's discount and the
bond insurance premium to be paid by the Purchaser on behalf of the City and less[plus] the net
original issue discount[premiur4 shall be deposited,upon receipt,to the"South Lake
Washington Infrastructure Project Fund"(the "Project Fund"), established in the office of the
City Finance and Information Services Administrator, to pay part of the costs of the Project.
Except as provided by the Code and Section 15 of this Ordinance, the interest and profits
derived from the investment of Bond proceeds shall be deposited in the Project Fund and applied
as described in the preceding paragraph.
Except as provided by thel Code and Section 15 of this Ordinance,if any money allocable
to the Bond proceeds remains in the Project Fund after payment of all the costs of the Project or
after termination of the Project by the City, such money shall be transferred to the Bond Fund
and applied to the payment of the principal of and interest on the Bonds.
Pending application as described in this Section 14 and subject to the requirements of the
Code and Section 15 of this Ordinance,money allocable to the Bond proceeds in the Project
Fund may be temporarily deposited in such institutions or invested in such investments as may
be lawful for the investment of City funds.
Section 15. Tax-Exempti n Covenants. The City covenants that it will not take or
permit to be taken on its behalf any action that would adversely affect the exclusion of the
interest on the Bonds from the gross income for purposes of federal income taxation, and will
take or require to be taken such acts as may be permitted by Washington law and as may from
time to time be required under applicable law to continue the exclusion of the interest on the
Bonds from the gross income for purposes of federal income taxation. Without limiting the
generality of the foregoing,the City will not invest or make or permit any use of the proceeds of
the Bonds or of its other money at any time during the term of the Bonds which would cause the
Bonds to be "arbitrage bonds"within the meaning of Section 148 of the Code.
The City covenants that it shall calculate or cause to be calculated, and shall rebate to the
United States, all earnings from the investment of Bond proceeds that are in excess of the
amount that would have been earned had the yield on such investments been equal to the yield
on the Bonds,plus income derived from such excess earnings,to the extent and in the manner
required by Section 148 of the Code.
The City has not been notified of any listing or proposed listing by the Internal Revenue
Service to the effect that the City is a bond issuer the arbitrage certifications of which may not be
relied upon.
f:\renton\itgo 2006 9
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The City will take no actions and will make no use of the proceeds of the Bonds or any
other funds held under this Ordinance which would cause any Bond to be treated as a"private
activity bond" (as defined in Section 141(b) of the Code) subject to treatment under said
Section 141(b) as an obligation not described in Section 103(a)of the Code, unless the tax
exemption thereof is not affected.
Section 16. Preliminary Official Statement Declaration. The City has been provided
with copies of a preliminary official statement dated , 2006, (the"Preliminary
Official Statement"),prepared in connection with the sale of the Bonds. For the sole purpose of
the Purchaser's compliance with Securities and Exchange Commission Rule 15c2-12(b)(1),the
City"deems final"the Preliminary Official Statement,as of its date, except for the omission of
information on offering prices, interest rates, selling compensation, delivery dates,ratings, other
terms of the Bonds dependent on such matters.
Section 17. Undertaking to Provide Continuing Disclosure. This section constitutes the
City's written undertaking for the benefit of the Owners and Beneficial Owners of the Bonds
required by subsection(b)(5)(i)of the Rule 15c2-12 (the"Rule") of the United States Securities
and Exchange Commission(the"SEC").
The City hereby agrees to provide or cause to be provided to each then existing
NRMSIR, to the SD, if one is created, and to the Bond Insurer the following annual financial
information and operating data(collectively,the"Annual Financial Information") for each prior
fiscal year, commencing with the fiscal year ending December 31, 2006, on or before the last day
of the seventh month following the end of such prior fiscal year:
(a) Annual financial statements prepared in accordance with the generally
accepted accounting principles applicable to governmental units, as such principles may
be changed from time to time and as permitted by State law;which statements will not be
audited, except that if and when audited financial statements are otherwise prepared and
available to the City,they will be provided (the"Annual Financial Statements");
(b) The assessed valuation of taxable property in the City;
(c) Ad valorem taxes due and the percentages of taxes collected;
(d) Property tax levy rates per$1,000 assessed valuation;
(e) A statement of authorized, issued and outstanding general obligation
indebtedness of the City; and
(f) A narrative explanation of the reasons for any amendments to this
Section 17 made during the previous fiscal year and the impact of such amendments on
the Annual Financial Information being provided.
In its provision of such financial information and operating data, the City may cross-
reference to any"final official statement"(as defined in the Rule) available from the Municipal
f:\rentonMtgo 2006 10
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Securities Rulemaking Board(the "MSRB") documents theretofore provided to each then
existing NRMSIR or the SID, if one is created.
If not submitted as part of the Annual Financial Information,then when and if available,
the City shall provide its Annual Financial Statements, which shall have been audited by such
auditor as shall be then required or permitted by the State law, to each then existing NRMSIR, to
the SID, if one is created, and to the Bond Insurer.
The City further agrees to provide or cause to be provided, in a timely manner, to the
SD, if one is created, and to eithler the MSRB or each then existing NRMSIR and to the Bond
Insurer, notice of any of the follolwing events with respect to the Bonds, if material:
1. Principal and interest payment delinquencies;
2. Non-payment related defaults;
3. Unscheduled difficulties;
4. Unscheduled draws on credit enhancements reflecting financial
difficulties;
5. Substitution of credit or liquidity providers, or their failure to perform;
6. Adverse tax opinions or events affecting the tax-exempt status of the
Bonds;
7. Modification to rights of the Owners of the Bonds;
8. Optional redemptions of the Bonds;
9. Defeasances of the Bonds;
10. Release, substitution or sale of property securing repayment of the Bonds;
and
11. Rating changes.
The City also agrees to provide or cause to be provided, in a timely manner,to the SID, if
one is created, and to either the MSRB or each then existing NRMSIR, notice of its failure to
provide the Annual Financial Information for the prior fiscal year on or before the last day of the
seventh month following the end of such prior fiscal year.
After the issuance of the Bonds, so long as the interests of the Owners or Beneficial
Owners of the Bonds will not be materially impaired thereby, as determined by a party
unaffiliated with the City(including,without limitation, a trustee for the Owners, nationally
recognized bond counsel or other counsel familiar with the federal securities law), or pursuant to
a favorable"no-action letter"issued by the SEC, this Section 17 may only be amended in
connection with any change in legal requirements, change in law, or change in the identity,
f:lrentonMtgo 2006 11
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r or Discussion Purposes Only
nature or status of the obligated person, or type of business conducted, and only in such a manner
that the undertaking of the City, as so amended,would have complied with the requirements of
the Rule at the time of the primary offering, after taking into account any amendments or
interpretations of the Rule, as well as any change in circumstances.
The City's obligations to provide Annual Financial Information and notices of certain
events shall terminate without amendment upon the defeasance,prior redemption or payment in
full of all of the then outstanding Bonds. This Section 17 or any provision hereof, shall be null
and void if the City(i) obtains an opinion of nationally recognized bond counsel or other counsel
familiar with the federal securities laws to the effect that those portions of the Rule which require
this Section 17 or any such provision are invalid, have been repealed retroactively or otherwise
do not apply to the Bonds; and(ii)notifies and provides the SD, if any, and either the MSRB or
each then existing NRMSIR with copies of such opinion.
The right of each Owner or Beneficial Owner of Bonds to enforce the provisions of this
Section 17 shall be limited to the right to obtain specific enforcement of the City's obligations
under this Section 17, and any failure by the City to comply with the provisions of this
undertaking shall not be a default with respect to the Bonds under this Ordinance.
The City Finance and Information Services Administrator is authorized and directed to
take such further action on behalf of the City as may be necessary, appropriate or convenient to
carry out the requirements of this Section 17.
Section 18. Contract; Severability. The covenants contained in this Ordinance shall
constitute a contract between the City and the Owners of each and every Bond. The City
unconditionally covenants that it will keep and perform all of the covenants of the Bonds and this
Ordinance. If any one or more of the provisions of this Ordinance shall be declared
unconstitutional or invalid for any reason, such decision shall not affect the validity of the
remaining provisions of this Ordinance or the Bonds, and this Ordinance and the Bonds shall be
construed and enforced as if such unconstitutional or invalid provision had not been contained
herein.
f\renton\ltgo 2006 12
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Section 19. Effective Date. This Ordinance shall take effect and be in force five days
from and after its passage and publication as provided by law.
PASSED by the City Council this day of ,2006.
Bonnie Walton, City Clerk
APPROVED BY THE MAYOR this day of , 2006.
Kathy Keolker, Mayor
Approved as to Form:
Bond Counsel
Date of Publication: (Summary)
f:\renton\ltgo 2006 13
0-40poop
RENTON
AUFAD OF THE CURVE
2006 Bond Issue
Review of Process
Mike Bailey, FIS Administrator
RENToObjective of Presentation
nierxn av rx+u:f r.cx
• Describe the process a city goes through
to issue bonds:
—To answer your questions early in the effort
— To advise of the documents and decisions.
—To get your feedback
— Ensure a successful bond sale on July 17
2006 Bond Issue Process 2
1
z:
RE Schedule
• Rating Requested... ... .... July 6
• Preliminary Official Statement
(POS) Release... ... .... July 7
• Pricing Date ... ... ... July 13 or 17
• Ordinance Adopted July 17
• Closing Date... ... ... ... ... ... August 2
2006 Bond Issue Process 3
RENTON
)F .i!i�\A
Purpose of this Bond Issue
nIPP.\h YY3N
• Roadway and other Infrastructure for
"The Landing"
— In accordance with actions previously taken
by the City, and
— The schedule provided for in the agreements
and bid
• Improvements on SW 27th and Strander
— In support of the Federal Reserve building
2006 Bond Issue Process 4
2
I
r"
— N
REEstimated Size of Bond Issue
I
Sources:
2006 Bonds , $ 20,665,000
Original Issue(Discount)/Premium 88,965
Total I $20,753,965
I
I
Uses:
Project Fund —The Landing $16,600,000
Project Fund —Strander Blvd. 2,800,000
Capitalized Interest 1,079,061
Costs of Issuance(est) 206,650
Bond Insurance Premium(est) 67,570
Rounding 1 683
Total $20,753,965
I
I
I
2006 Bond Issue Process 5
NTO
REN
rs n Anticipated Structure
E�, ,000-............................... ;.............,.....,....,..........,.....,...............................,.....;..........,�
$5.000.000 i3,:5.?: t, „; "f
7
$4.000.000 Y {
E3,000,000 z iiii ,^ve r;'-'`,-M, ■Series 2008
II
. bhhl� '. max.",.�'aw+�",,`c< t3 Existing Debt
00 � �' I
4'IP 4 ,e,t'1^d'5.ed' ,p4'e,6,' lee9'9,,,,,E`6',",,o94e
2006 Bond Issue Process 6
3
hJ
RENTO Type of Bonds
• Limited Tax - General Obligations
— Council's discretion
— Paid without additional tax levies
— "Full faith and credit" of the city
— Not:
• Unlimited tax (like the senior housing bonds)
• Revenue backed (like utility or golf course bonds)
2006 Bond Issue Process 7
RENT N Type of Sale
• Negotiated Sale
— To lead underwriter — D. A. Davidson & Co.
—Agrees to buy all the bonds at market price
—Agrees to pay for certain costs of marketing,
the bonds
— No costs if the sale does not close
— Not: A Competitive Sale
2006 Bond Issue Process 8
4
I
RENTON Offer to Purchase Bonds
• Negotiated sale results in an offer to
purchase the bonds from the city by
lead underwriter
— D. A. Davidson will present the City Council
an offer to purchase the bonds on July 17
— Financial Advisor (FA) will provide advice as
to pricing and terms of offer to City.
— "FA" is,Seattle Northwest Securities
2006 Bond Issue Process 9
RENT N Purchase Offer Contingencies
nfLR.1A:)1`vLiN
• Legal opinion
— "Bond counsel" is Judy Andrews of Gottlieb,
Fisher & Andrews
— States that bonds are enforceable obligations
of the city and interest is exempt from federal
taxes
— Bond counsel will appear at council meeting
ofJuly 17
2006 Bond Issue Process 10
5
RENT N Purchase Offer Contingencies
• Rating by nationally recognized firm
— Submitting for rating with:
• Fitch Ratings
• Standard and Poor's
— Existing rating on city GO Bonds is A+
• Insurance option
— Will do cost benefit analysis of providing bond
payment insurance and work into pricing
2006 Bond Issue Process 11
RENT N Purchase Offer Contingencies
• Terms of the bonds
— Official Statement (Prospectus)
— Call feature — 10 years
— Interest rates / pricing
• Could include premium or discount bonds
— Term bonds
— Compliance with IRS regulations regarding:
• arbitrage and
• use of proceeds
2006 Bond Issue Process 12
6
RENTON Relevant Documents
• Draft Bond Ordinance
• Prelimin'ary Official Statement.
• Official Statement (at sale close)
• Rating presentations
• Rating Reports (when available)
2006 Bond Issue Process 13
RENTON ► Questions
2006 Bond Issue Process 14
7
„...
, (1,0-nm„ttiz, ‘laiite id-46%e s
b//q/kap
TThe Landing Project Budget
Revenues Anticipated Expenditures
General Fund contribution to $1,500,000 Preliminary Design $ 1,500,000
Preliminary Design costs
REET 1,452,181 Additional Design 1,375,000
Sales Tax 621,445 Construction Management 1,781,000
(2/3 of construction materials)
--- - - --------- -- -- - - - -- ------------ -- -------- -Reimbursement from THL (for work done 978,152 Roads 15,168,907
by City onbehalf of THL.) •
State Grant 5,000,000 Utilities 2,470,548
Permit Fees (only the portion related to The 0 Limited Term Building Inspectors (paid 0
Landing building inspection) by permit fees) See Note 1
Bond Proceeds 16,605,809 Joint Trench (City share of cost) 838,152
Contingency 1,847,761
City Sidewalks (provided by THL) 210,000 .
Alt. #2 - Concrete roadway 966,220
$26,157,587 $ 26,157,587
. Note 1
Permit Fees (only the portion related to The 268,000 Limited Term Building Inspectors (paid 268,000
Landing building inspection) by permit fees) See Note 1
Budget Authority
Total Anticipated Expenditures $26,157,587
Less Preliminary Design ($1,500,000)
Plus Limited Term Building Inspectors 268,000
Requested Budget Authority I $24,925,587
Financing Plan
Revenues II Anticipated Expenditures
Property Tax/EMS Levy 1,200,441 Debt Service -
Utility Taxes Roads $1,298,810
172,398
Sales Tax 862,460
Business.License Fees 40,990
Admission Tax -
Total Annual Revenues at 100% $2,276,289 Difference between revenues and Debt Service $977,480
Total Annual Revenues at 66% $1,518,285 Difference between revenues and Debt Service $219,475
Assumptions:
Property Tax Growth Rate - 1% per year
Sales Tax Growth Rate - 1%per year
Increased Assessed Value = $334 m
Gross Utility Costs = $2.7 m
Total.Sales = $97.9 m
Total New Employees = 785
Y
1
City Bonds - Transportation Projects June 15,2006
South Lake Washington Infrastructure Project, Phase 1 (The Landing Project)
Cost item • I EEstimated Revised After Source Bond Source Bond Source Bond
Cost Bid General Fund Reimb.? CTED Grant Reimb.? Other Reimb.? City Bond Comment
Design 2 2,875,000 2,875,000 1,500,000 No
Contract 650,000 No 725,000 See Note 2.
Road(storm water included in bid)s— 9,760,000 15,168,907
Utilities 4,350,000 No 140,000 No 10,678,907 See Notes 2&3.
Water Utility{- 2,425,000 1,436,825
Sewer Utility 1,090,000 1,033,723 See Note 4.
Storm Water Utility 5,125,000
Sub-total Utilities 8,640,000 2,470,548
Joint Trench a 655,000 838,152 2,470,548
Sub-total838,152 No See Note 5.
19,055,000 18,477,606 �"
Contract }
Bid Contingency-10% 1,847,761 .
1,847,761
__ Construction Management ' 1,781,000 _ 1,781,000 ---_ —__ —
Harvest Partners Citya `— —1;781;000 See Note 7:
Sidewalk 210,000 210,000 210,000 See Note 6.
Total SLW Infra.Project,Ph.1 $ 23,921,000 $ 25,191,367 $ 1,500,000 $ 6,000,000 $ 978,152 $ 17,713,216 Sub-total Bond
Other Revenue
SW 27th Street/Strander Blvd. Connection - Phase 1, Segment 1 (Federal Reserve Bank)
(1,452,181) REET
Estimated (621,445) Sales Tax
Cost ItemCost Source Bond (2,073,626) Sub-total Revenue
City Bond Comment
Reimb.?
Design-30%to 100"/0 8 200,000 200,000 See Note 8. _ $ 15,639,589 SLW Bond-Alt.#1
Right-of-way 382,000 382,000 $ 16,605,809 SLW Bond-Alt.#2
Contract -
Concrete
Roadway 1,790,000 1,790,000
Water 160,000 160,000 No Total - Both Projects
Sewer 70,000- 70,000 No
-
Pond 550,000 302,500 No - 247,500 City Bond
Sub-total Contract 2,570,000 SLW Infrastructure Project $ 15,63';.
Construction Management 200,000 20,000 No 180,000 SW 27th/Strander Blvd. $ 2,794,:,.,:1
Total Bond Amount(SLW Alt.#1) $ 18,439,089
Total SW 27th St.-Ph.1 ,Seg.1 $ 3,352,000 $ 552,500.00 $ 2,799,500 SW 27th Bond Total Bond Amount(SLW Alt.#2) $ 19,405,309
Notes:
1. South Lake Washington estimated cost based on 100%cost estimate(April 18,2006). Bid amount reflects low bid,June 12,2006.
2. This amount includes using$1,500,000 of General Fund money toward$1,962,714 of expenditures in 2004/05,not reimbursable by the bond.
3. Includes fiber optics($100,000)for Logan Ave.to City Hall. Harvest Partners to reimburse City$140,000(left-turn lanes).
4. The water pressure reducing station for the project is included($400,000).
5. The City will construct some franchise utility work as part of the project and will be reimbursed for the cost by Harvest Partners.
6. Harvest Partners will be doing some of the City's sidewalk work(to match their sidewalk beyond the right-of-way)and we will reimburse them$210,000.
7. Includes$30,000 for purchase of a car for project management team.
8. $1 million was received from the General Fund in 2003 for up to 30%design of all phases. It has been spent.
9. The total bid for Alternative#2,constructing concrete roadway,is$19,443,826.60($966,220.32 higher than Alternative#1).
l:1sgriffinlbudgettCIty Bonds-Transportation After Bid June 2006
June 19,2006 Renton City Council Minutes Page 211
Utility: Sanitary Sewer Flows, Utility Systems Division requested approval of an agreement with Skyway
Skyway Water and Sewer Water and Sewer District to allow for the conveyance of a portion of the
District district's flow through the City's system. Refer to Utilities Committee.
MOVED BY CORMAN, SECONDED BY NELSON, COUNCIL APPROVE
THE CONSENT AGENDA AS PRESENTED. CARRIED.
UNFINISHED BUSINESS Council President Corman presented a Committee of the Whole report
Committee of the Whole recommending concurrence in the staff recommendation to award the South
CAG: 06-068, South Lake WA Lake Washington Roadway Improvements construction contract to the lowest
Roadway Improvements, responsible bidder, Ceccanti, Inc. in the amount of$19,443,826.60 which is
Ceccanti Alternate#2-Concrete. The improvements will extend Logan Ave.N. from N.
6th St to the existing intersection at Garden Ave. N. and Lake Washington
Blvd.N.,N. 8th St. from new Logan Ave. N. to existing Park Ave.N.,N. 10th
St. from new Logan Ave.N.to existing Garden Ave.N.; and will realign and
widen existing Park Ave.N. from N. 8th St. to new Logan Ave.N.
The Committee further recommended that the Mayor and City Clerk be
authorized to sign the contract with Ceccanti,Inc., in the amount of
$19,443,826.60. MOVED BY CORMAN, SECONDED BY LAW, COUNCIL
CONCUR IN THE COMMITTEE REPORT. CARRIED.
Council President Corman commended staff for their efforts on the roadway
improvements project, and pointed out that the analysis they conducted
addressed attorney Peter L. Buck's comments at last week's Council meeting
regarding this project. Mr. Corman stated that the tax revenues are there for the
roadway improvements. He indicated that discussion will occur in the future
about the density on all the acreage of The Landing project and it is not tied to
the roads in any way.
Transportation: Outgoing Mayor Keolker recognized the contributions of Rich Perteet to the City of
Interim Design, Planning& Renton over the last six months as Interim Transportation Design, Planning and
Programming Supervisor Programming Supervisor, and she expressed her appreciation for his service.
Recognition �.
Finance Committee Finance Committee Chair Persson presented a report regarding the 2006 Budget
Budget: 2006 Amendments, amendment ordinance for infrastructure improvements regarding The Landing
South Lake WA Infrastructure project. The Committee recommended concurrence in the staff
Improvements (The Landing) recommendation to approve the budget amendment ordinance to provide for the
^„ , creation of Fund 318, South Lake Washington Infrastructure Project,the
Yo +�` addition of two limited-term employees, and budget authority in the amount of
$24,925,587.
The Committee further recommended approval to grant authority to proceed
with the project and its related implementation steps, including road
improvements and a Limited Tax General Obligation)3ond sale. The
Committee further recommended that the ordinance regarding the matter be
presented for first reading. MOVED BY PERSSON, SECONDED BY LAW,
COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. (See
page 215 for ordinance.)
Transportation (Aviation) Transportation (Aviation)Committee Chair Palmer presented a report
Committee recommending approval of an Airport building and ground lease agreement
Lease: AirO Inc, Airport with AirO, Inc. for a portion of the 790 Building and 17 adjacent parking stalls.
•
7 .. rPhOvE0 E
cirt COWilCiL
i.
• FINANCE:COMMITTEE Date_
COMMITTEE REPORT
June 19,2006.
'. ' 2006 BUDGET AMENDMENT ORDINANCE FOR INFRASTRUCTURE'
IMPROVEMENTS REGARDING THE LANDING -• •
(Referred May 1$;2006)
• ,l
The Finance Committee recommends concurrence in the;-staff recommendation to-approve the
budget amendment ordinance 'to-'• rovide -fogcreation.:of'Fumd-318,.'South:Lake.Washington
Infrastructure Project, the addition)of two:-limited=term,:employees, arid budget'authority in the
amount of$24,925,587. • - .a. - :'
• " ' -The:Committee further recommends;approva to'-grant authority to proceed with theproject:
and-its related implementation steps,,meluding,•road°m provements and a Limited Taxi General • -
•5 implementation
zi-°t<.;.meq;::.ti`.'�.,•s.ii".sl.'.'.'V;x����`y,K. 4 -
Obligation Bond sale..
as.
The Committee further'recommends:-that the ordinance regarding-this matter be presented for. .
first reading.
Don Persson, Chair
f . '
, . . .(A) . , -
Denis W.Law,-Nice=Chai•r . ' -
_: Toni'Nelson,Member: . ; " - ' ,
- - ' "cc: 'Michael E.Bailey;Finance&IS Administrator
Gregg Zimmerman,.P�B/PW'Administrator
=" - Bang Parkinson,Finance Analyst Supervisor . : '
Neiita'Ching;Principal Finance and Adniin Analyst '
'° i
June 19,2006 Renton City Council Minutes Page 215
allow construction work for•the Hoquiam Ave.NE roadway improvements
project. The Committee further recommended that the resolution regarding this
matter be presented for reading and adoption. MOVED BY PALMER,
SECONDED BY BRIERE, COUNCIL CONCUR IN THE COMMITTEE
REPORT. CARRIED. (See below for resolution.)
Resolution#3821 A resolution was read authorizing the temporary total closure of Hoquiam Ave.
_ Streets: Hoquiam Ave NE NE from NE 7th Pl. to NE 9th St., from June 26 to June 30, 2006. MOVED
Temporary Closure BY PALMER, SECONDED BY BRIERE, COUNCIL ADOPT THE
RESOLUTION AS READ. CARRIED.
Resolution#3822 A resolution was read authorizing the Mayor and City Clerk to enter into an
Utility: Springbrook Creek interlocal cooperative agreement with the Washington State Department of
Wetland&Habitat Mitigation Transportation regarding Springbrook Creek Wetland and Habitat Mitigation
Bank Instrument, WSDOT Bank and associated legal instruments. MOVED BY CLAWSON,
SECONDED BY BRIERE,COUNCIL ADOPT THE RESOLUTION AS .
READ. CARRIED.
The following ordinance was presented for first reading and referred to the
Council meeting of 6/26/2006 for second and final reading:
Budget: 2006 Amendments, An ordinance was read creating a fund for the South Lake Washington
South Lake WA Infrastructure Infrastructure Improvements Project. MOVED BY LAW, SECONDED BY
Improvements (The Landing) PERSSON, COUNCIL REFER THE ORDINANCE FOR SECOND AND
c.744 FINAL READING ON 6/26/2006. CARRIED.
The following ordinance was presented for second and final reading and
adoption:
Ordinance#5212 An ordinance was read adding Sections 5-11-4 through 5-11-8 to Chapter 11,
Finance: Utility Tax Utility Tax, of Title V (Finance and Business Regulations) of City Code to
Exemption establish a utility tax relief program. MOVED BY CLAWSON, SECONDED
BY NELSON, COUNCIL ADOPT THE ORDINANCE AS READ. ROLL
CALL: ALL AYES. CARRIED.
Mayor Keolker thanked the residents at Leisure Estates for bringing this
proposal before the City.
NEW BUSINESS MOVED BY PERSSON, SECONDED BY NELSON, COUNCIL CANCEL
Council: Meeting Cancellation THE 7/3/2006 COUNCIL MEETING. CARRIED.
(7/3/2006) •
Board/Commission: Highlands MOVED BY BRIERE, SECONDED BY CLAWSON, COUNCIL REFER THE
Area Citizens Advisory ISSUE OF A CITIZENS ADVISORY COMMITTEE FOR THE HIGHLANDS
Committee TO THE PLANNING AND DEVELOPMENT COMMITTEE. CARRIED.
AUDIENCE COMMENT Sandel DeMastus,Highlands Community Association(HCA)Vice President,
Citizen Comment: DeMastus - 1137 Harrington Ave.NE,Renton, 98056,noted that the HCA also worked
Utility Tax Exemption with the City on the matter of the utility tax relief program.
Councilman Clawson indicated that this matter has been around for a long time
and the Administration was finally able to find a way to put it into action. He
acknowledged everyone's contributions, saying it was a team effort.
Citizen Comment: Petersen - Inez Petersen, Highlands Community Association Secretary,PO Box 2041,
Various Renton, 98056, expressed concern regarding the lack of acknowledgement on
the record of correspondence to Council. Referring to the topic of eminent
domain, she noted the one-year anniversary of the U.S. Supreme Court decision
on Kelo et al. v. City of New London et al. Ms. Petersen further noted that
RECEIVEd
JUN 12. 2006
Yo PLANNING/BUILDING/ RENTON CITY COUNCIL
PUBLIC WORKS DEPARTMENT
• . �Q
® ♦ CITYOF PJdTON
'MEMORANDUM JUN 1. 2, 2006
—
orry-SUSFiet
DATE: May'26, 2006 •
TO: Don'Persson, Committee Chair
Members of the Finance Committee
CC: Kathy Keolker, Mayor
Jay Covington, Chief_:dministrative Officer
FROM: Gregg Zimmermk=':/PW Administrator
STAFF CONTACT: Sharon Griffin, Transportation Division Program Development
Coordinator(extension 7232)
SUBJECT: Bond Reimbursement for SW 27th St.,Phase 1, Segment 1,
Transportation Capital Improvement Fund 317
ISSUE:
During the Finance Committee's recent review of the Administration's proposal to
amend the budget for infrastructure improvements associated with the Landing project, a
question was raised.about the proposal to issue$2.8 M in bonds for Phase 1 Segment 1
(providing access to the Federal Reserve Bank)-of the SW 27th Street project. This
project is currently under construction. We wish to provide you with some background
information on this important issue.
BACKGROUND:
In December 2004, the Transportation Division was asked to start 100% design of a
portion of the SW 27th St./Strander Boulevard Connection project to support a new
development, the Federal Reserve Bank project on the Longacres site. The requested
portion became Phase 1, Segment 1 from Oakesdale Ave. SW to the beginning of the
future bridge structure. The project would construct a new at-grade four/five-lane
roadway(1,200 lineal feet).
To n}eet the needs•of the development and move the project forward quickly, the
Transportation Division was requested to "front"both the design and construction funds
from the Transportation Division Capital Improvement Fund 317 until bonds could be
issued to pay for the project. This portion of the project would not have been advanced to
construction at that time had it not been for the need to build this portion to provide
access to the Federal Reserve Bank. The project was included in the 2006-2011 Six-Year
Transportation Improvement Program (TIP)to meet this request. The source of funds for
h:\division.s\admin\gregg\sw27thbond.doc revised.doc
Don Persson,CommitteSir •
Page 2 of 8
May 26,2006
the project was shown as "sale of bonds"in the TIP that was adopted by the City Council
in June/July 2005.
References to the SW 27th Street bond issuance in the 2006-2011 TIP:
From the 2006-2011 TIP issue paper(see attached page two):
"Some of the newly funded projects were determined by economic development needs
that required City match:
#12 South Lake Washington Roadway Improvements (Proposed funding by sale of
bonds)
#3 Strander Boulevard/SW 27th St,Phase 1, Segment 1 (Proposed funding by sale of
bonds)"
Other references to the SW 27th St. bond issuance from this document are attached.
Reference to the SW 27th St. bond issuance in the August 15, 2005 agenda bill to
authorize Supplemental Agreement No. 3 to complete the design of Phase 1, Segment 1:
The subject agenda bill(copy attached) states"funding will initially come from the
current 317 ending fund balance that will be used as a `bridge loan' until bonding for the
South Lake Washington Roadway Improvements Project is secured. Up to $3,000,000
will be bonded for the construction, construction engineering/administration and City
share for land costs of Tract D."
Reference to the SW 27th St. bond issuance in the September 19, 2005 Finance
Committee report authorizing the construction of Phase 1 Segment 1 of SW 27th St.
The paragraph numbered 1 of this Committee report(attached) states that the full amount
of the budget adjustment for this project will be reimbursed from future proceeds of a
tax-exempt bond sale.
This bonding provision is just one element of a large and complex project, but it is very
important in terms of making the Transportation Capital Fund 317 whole in order to
continue to fund the City's TIP.
If the sale of bonds does not reimburse Fund 317 for the design and construction
expenditures for the SW 27th St./Strander Blvd. Connection project, definite impacts can
reasonably be expected now and in the coming years. Transportation Division staff
calculated and estimated that$2,799,500 was required from the bonds as reimbursement.
For the purposes of further discussion, we will round that to $3 million. If not
reimbursed, it leaves a hole of$3 million in the six-year capital program since the
reimbursement was shown as expected revenue.
To begin to look at this issue, it is useful to understand the funding detail of the Six-Year
TIP. Since the fund source of approximately $3 million was listed as bonds in the TIP
(page 5-3), it means that in order to balance the revenues to the expenditures, $3 million
h:\division.s\admin\gregg\sw27thbond.doc revised.doc
Don Persson,Committee ___-Fir
Page 3 of 8
May 26,2006
must be recouped as revenue, as expected,to balance the TIP program. If it is not
recouped from the sale of bonds, it must come from a different reliable source or sources,
such as other projects or ending fund balance, to balance the current program. This might
include dropping or delaying;current projects to fill the gap, or using fund balance,which
could affect future projects or funding opportunities (limiting match funds needed for
grants).
OTHER PROJECTS:
If you look at other projects in the TIP (page 4-1), you will not find an easy answer to
finding$3 million to fill the gap. If you propose to pull from the year 2006 only,the
closest project to having$3 million is Duvall Ave.NE with$2.5 million. Since it is a
grant-funded project,pulling any funding will also pull the grant funding. And the
funding pulled is just a fraction of the $3 million. If you broaden your search to all six
years, you see the Overlay program($2.7 million), Rainier Ave. and Hardie Ave. projects
(Sound Transit projects- $6J3 million and$15.1 million), and Rainier Ave. project(TIB
project$6.5 million). What you find preliminarily is that projects with enough funding to
reimburse the hole of$3 million have grant and other outside funding sources, which
limit their usefulness as cash sources.
FUND BALANCE:
Continuing from the TIP perspective, if you look at a selective source of funds, i.e.,the
"Proposed Fund Balance" (page 4-5), you will see a total for the six years of$5,787,933.
This figure represents spending almost$6 million of the fund balance on specific
projects. In other words, the fund balance of the Transportation Capital Fund 317 is
supporting the projects listed, i.e., overlay program, Rainier Ave. (Sound Transit),Hardie
Ave. (Sound Transit), Rainier Ave. (TIB), South Renton, bridge inspection, May Creek
Bridge, Duvall Ave., and SR 169 project. Once again,pulling these funds will affect
projects with outside funding sources. Removing the City match from the fund balance
effectively stops the project
Question:
So what is left of the fund balance when these programmed fund balances are removed
from the ending fund balance?
Answer:
An analysis for the 2006-2011 Six-Year TIP Fund 317 (including a transfer of funds from
Fund 305) showed a total fund balance of$42,011 on December 31, 2011. That is not a
typographical error—it is forty-two thousand dollars after six years if expected revenues
are not increased. This illustrates the importance of grant revenue and mitigation funds
to the Transportation Capital fund.
A separate analysis for the 2006 Capital Improvement Fund 317 Budget Adjustment
showed a fund balance of$4.4 million with commitments of$4.2 million beyond 2006.
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Don Persson,Committethair • •
Page 4 of 8
May 26,2006
These commitments included agreements with the Freight Mobility Strategic Investment
Board(FMSIB), Sound Transit, and the Transportation Improvement Board (TIB).
The success of the Transportation Capital Improvement Program is the ability to leverage
our dollars against dollars from outside sources. To do so,we must continue to back up
our current matching funds with real dollars, and continue to have on hand real dollars to
reach for new opportunities.
The document that grounds the City's transportation needs is the Council-adopted
Transportation Element of the City's Comprehensive Plan. The Transportation Division
strives to meet the Regional goals and remain in compliance. If the City does not remain
in compliance,the City could fall short of meeting its adopted transportation concurrency
standards,which in turn could curtail development in the City. The City could also lose
its Certification Acceptance (CA) status from the Washington State Department of
Transportation(WSDOT). This would undermine future efforts to secure grants.
At the same time,the Transportation Division strives to meet other needs of the City,
such as economic development, without compromising the TIP program.
ADDITIONAL DETAILS OF THE SIX-YEAR PROGRAM:
The following Table 1 represents the analysis of the Transportation Division Capital
Improvement during the annual Six-Year Transportation Improvement Program
Preparation(TIP). This analysis is done to ensure that there is sufficient revenue to
balance the expected expenditures over the six years. The revenue includes new revenue
from various sources (listed), Fund 317 fund balance, and transfer of mitigation funds
from Fund 305. One of the revenue sources listed is the revenue from the sale of bonds
for the South Lake Washington (Lakeshore Landing)project and the SW 27th
St./Strander Blvd., Phase 1, Segment 1 (Federal Reserve Bank)project.
The analysis indicates that after summing all of the anticipated new revenue, we would
need $5,787,933 of the Fund 317 fund balance, as well as a transfer of$7,068,575 from
Fund 305.to Fund 317,to balance the six-year program. The ending fund balance in
Fund 317 would be$27,643 on December 31, 2011. The ending fund balance for Fund
305 would be$14,368 on December 31,2011. The combined fund balance would be
$42,011 on December 31, 2011. If expected revenues increase,new revenue sources are
identified, additional grant funds are secured, or expenditures are slowed down, these
ending fund balances would increase.
In previous years,the initial result of balancing the revenues to the expenditures was
positive, although the source of funds would require reallocation to match the expected
revenue parameters. However, for the first time last year,the initial balance was $5
million in the red. It was necessary to review all of the project revenue sources, and un-
fund some of the projects in the outer three years to balance the program.
h:\division.s\admin\gregg\sw27thbond.doc revised.doc
Don Persson,Committee
Page 5 of 8
May 26,2006 - - '
Since this analysis was prepared in June 2005,the budgeted fund balance was used. At
that time,the January 1, 2006, fund balance was budgeted to be $8,197, 876. The actual
fund balance on January 1, 2006 was $7,355,846. This is$842,030.less than what is
shown in Table 1 below. This is understandable, since$2,009,784 was spent in 2005 on
the South Lake Washington Infrastructure project and the SW 27th St./Strander Blvd.
project without the expected reimbursement from the sale of bonds. Specifically,
$1,011,941 was spent in 2005 on the former project and$997,843 on the latter project.
The likely reason that the expected fund balance is $842,000 less rather than$2 million
less is due to other projects progressing more slowly than anticipated, slowing down
expenditures.
The next section after Table 2, "Additional Details for Ongoing Projects"will discuss the
most recent analysis of the 21006 budget for Fund 317 and the projects requiring funds.
TABLE 1
20,06—2011 Six-Year TIP Summary
Transportation Capital Improvement Fund
Fund 317 (including Fund 305)
2006-2011
Item Budget Comment
FUND 317
REVENUE:
Business License Fee $ 9,600,000. At$1,600,000 per year.
Transportation Grants 11,596,292
Charge for Services/Plan Sales -
Penalty/Gen. Business License -
Miscellaneous -
Trf-In From 305 7,068,575 As shown below in Fund 305.
Trf-In Fm Art Str Fd/Gas Tax 2,100,000 At$350,000 per year(Overlay Program)
New Vehicle Fuel Tax 1,310,000 Varied annual amounts.
Other In-Hand/Legislature 13,988,390 Includes $5 million from legislature
Bonds 18,939,000
TOTAL NEW REVENUE $ 64,602,257
Use of Prior Yr Revenue for 2006-2011 5,787,933
Page 6.
TOTAL RESOURCES $ 70,390,190
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Don Persson,Committeeeir • •
Page 6 of 8
May 26,2006
EXPENDITURES:
2006-2011 TIP Projects (Funded) 70,390,190
Additional Estimated 2005 Expenditures 2,382,300 Approved budget increase/reallocation
TOTAL PROGRAMMED EXPENDITURES $ 72,772,490
SUMMARY:
Use of Prior Yr Revenue 2006-2011 5,787,933
Use of Prior Yr Revenue Estimated 2005 2,382,300
USE OF PRIOR YR REVENUE TOTAL $ 8,170,233
Budgeted Fund Balance, January 1, 2006 8,197,876
Total New Revenue 64,602,257
Total Programmed Expenditures 1 (72,772,490)
317 Fund Balance,December 31,2011 $ 27,643
FUND 305
3,482,943
Budgeted Fund Balance, January 1, 2006.
Anticipated New Revenue 2006-2011 3,600,000 Estimated at$600,000 per year. 2
Total Committed Expenditures (7,068,575) Transfer to Fund 317 as shown above.
305 Fund Balance,December 31,2011 $ 14,368
TOTAL FUND BALANCE 317 & 305 3 $ 42,011 December 31,2011
1 TIP #11 Rainier Ave (railroad bridge)may need further funding pending engineer's cost estimate.
2 Dependent on development and credits.
3 This addresses ability to fund program, not cash flow.
ADDITIONAL DETAILS FOR ONGOING PROJECTS:
This analysis was prepared for the 2006 Transportation Capital Improvement Fund 317
Budget Adjustment. Again,this was done to determine if the revenues would balance the
proposed expenditures. Table 2 below summarizes the 2006 budget and Table 3
summarizes the current project commitments beyond 2006.
Page 7.
In Table 2, the actual beginning fund balance of$7,355,846 is shown, the sale of bonds is
included as a revenue source, and the ending fund balance on Dec. 31, 2006 is expected
to be $4,381,846 (not including the King County Metro Mitigation Reserve of$500,000).
h:\division.s\admin\gregg\sw27thbond.doc revised.doc
.
Don Persson,Committee',...;.:ir
Page 7 of 8
May 26,2006 -
In Table 3,the projects the City has committed to beyond 2006 (2007 through 2011) are
listed with their corresponding need for existing Fund 317 funds. The total need is
$4,138,977.
This available amount(not committed to projects) is only$242,869 greater than the
amount committed and programmed for future use. That is the amount available that was
not committed at the time ofthe analysis(Feb. 13, 2006). It is not uncommon that
ongoing projects have increased needs as they develop. This is a slim margin to cover
those expenses.
TABLE 2: 2006 BUDGET
Fund 317 2006 Budget
Beginning Fund Balance, Jan. 1,2006 $ 7,355,846
Projected New Revenue (Non-Bond) 1 15,174,000
Bond Issue Proceeds? 14,820,600
Total Revenues $ 37,350,446
Total Original 2006 Budget Expenditures 18,283,700
Budget Adjustments Per this Ordinance 14,684,900
Total-Adjusted Budget $ 32,968,600
Ending Fund Balance,Dec. 31,2006 $ 4,381,846
King County Metro Mitigation Reserve 3 500,000
Ending Fund Balance with Reserve,Dec.31,2006 $ 4,881,846
•
h:\division.s\admin\gregg\sw27thbond.doc revised.doc
Don Persson,CommitteeSir S
Page 8 of 8
- -May-26;2006 -
TABLE 3: BEYOND 2006
Project(TIP#) "Proposed Fund Funding Partners
Balance" 4
SW 27th St/Strander Blvd. (3) $ 372,251FMSIB 5
Rainier Av—S 4th to S 2nd(7) 1,443,000Sound Transit
Hardie Av SW Transit(8) 862,000Sound Transit
Rainier Av—S 7th to 4th PI (11) 540,OOOTIB 6
Page 8.
South Renton Project(13) 75,000
Bridge Inspection(18) 10,000
May Creek Bridge Replacement 710,000
(19)
Duvall Ave NE (28) 126,726TIB
SR 169 HOV (45) OMoved to 2006
"Proposed Fund Balance" $ 4,138,977Future use
Difference:
Projected Ending Fund Balance $ 4,381,846 Dec. 31, 2006
"Proposed Fund Balance" Source (TIP) $ 4,138,977 Future Committed Use
$ 242,869 Balance
CONCLUSION:
No action is required now. But staff recommends that the Council authorize issuance of
bonds to refund Fund 317 for approximately$3,000,000 of expenditures made to design
and construct Segment 1 of Phase 1 of the SW 27th/Strander Connection project.
cc: Mike Bailey.Finance/IS Administrator
Peter Hahn,PBPW Deputy Adminstrator—Transportation
Sharon Griffen,Program Development Coordinator
Nenita Ching,Financial Analyst
h:\division.s\admin\gregg\sw27thbond.doc revised.doc
_ ... .�...._ . _, . - APPROVED BY
CITY COUNCIL
Data 9-19=2oos
k
FINANCE.COMMITTEE.
. COMMITTEE REPORT
September 19,2005
. SW 27th St./Strander Blvd. Connection Project,Phase 1, Segment 1
(Referred September 12, 2005) : . .
•
The finance Committee recommends concurrence in the staff recommendations as follows for
:construction of a .27mile I extension of SW :27 Street.from'.Oakesdale•Ave. SW to. the
. proposed driveway access of the.Federal.Reserve Bat*,known as the SW 27' Street/Strander
Blvd.Connection;Phase 1,'Segrnent is,00gstitItibrit1 project
1:: Approve a budget adjustment to.allocate$3,217,836;K;fr'om the Transportation (317) •
Fund to.the SW 27thh`Street;Coni ection Project;budge for funding as detailed herein-
W tfu1i a a iptto be3reli bursedtfrrom .. . _ lam' '
�.' futirie �cs`����a tax�x mgt�Bo d�sa1°e'
p IIS tA,A >filar# i : -
• 2: Approve.Sup le eri !,en ��. `�:�xteet;gine.ui-to amount� of$1=10;846::40'
for • nts
project Boris ctiOn maria cement, rmtees : I . ' • -
- 3:. Accept-the low lid as Rsubmi ec 'dr .w`' lbe.cons ct onficontract to Qar3i Merlin
Construction;Inr:.in the_'anountf; 2,4530::72;.
4; Authorize.a 20%construetion:�con; t contingencytheamount of$485,306:14;:
- 5. Authorize�soft costslfor ti pro.ect•:in:the•=amount=of`$-'9S 00 - -
horized'to execute Su lemental
. The Conirxiittee.fuither recomtfxe�iiis;tiie;:iii`a.�oi°eti�d<�cYt%.c��zlc� �e. .PP .
:Agreeinent;#3 With Perteet Inc.,anidth coils ction contr ct w th Gary Meriino Construction,Inc.:
4M�,,
- ' ' Don 'Pers.--T r
son ;±Chair - -
. . . i -
I s- . .. ... :5�. • ,
Tom Nelson, Vice C air .
. . . '. : ... : ., ' s " . . . ''. '
i,./ Ct/:
Denis:.W:.Law;.Member
• '.ce: . Gre02ithniecman-
P,144M4'er
Leslie.L ndt •
, Mike Bailey' I i
• I '
6r 4-56
•TY OF RENTON COUNCIL AGENi�.BILL
AI N:
Submitting Data: Transportation Systems For Agenda of:
Dept/Div/Board.. . Planning/Building/Public Works August 15, 2005
Staff Contact Rob Lochmiller, x7303 Agenda Status
Consent •
Subject: Public Hearing..
Correspondence..
Strander Boulevard Extension—West Valley Highway Ordinance
(SR 181)to East Valley Road,CAG 03-033 Resolution
Supplemental Agreement No. 3 Old Business •
Exhibits: New Business X
Issue Paper Study Sessions
Supplemental Agreement Information
2005 Reallocation Summary-
• Phase 1, Segment 1 Project Costs
Reimbursement Resolution
•
Recommended Action: Approvals:
Legal Dept
Refer to Transportation Committee Finance Dept
Fiscal Impact: 317.12239.016.5950.0000.67.000000
Expenditure Required... $ 110, 846 Transfer/Amendment $3,000,0002
Amount Budgeted $ 210,0001 Revenue Generated $ 556,225
Total Project Budget $50,532,727 City Share Total Project.. $3,210,000
SUMMARY OF ACTION:
This supplemental agreement with Perteet,Inc.will provide construction management services for
the Strander Boulevard/SW 27th Street Connection: Phase 1, Segment 1.
A budget adjustment is also required to pay for both the Supplemental Agreement and
construction. The adjustment would increase the 2005 Strander Boulevard Project budget up to
$3,766,225 . du g willfinrt>ay miae2fr the current 17xend g d bat `at will be
u �as�a�b oarl`�.unhZ�bon uig�for�the�S:outhF Lake.�Vaslungton��Roatl�vImpr_��emei�_
.--TTS, ...,,_
rojec iecredligp�to I011:0 00 11 beb'ondEil for Ttonswoim;co -4trucfion i
ngineerinr n admin tration:andCENS lla e or=landreos.sTof Tract;p
STAFF RECOMMENDATION:
1. Authorize the Mayor and City Clerk to execute Supplemental Agreement#3 with Perteet, Inc. in
the amount of$110,846.
2. Authorize Finance to process a budget adjustment to the Transportation Fund and budget in order
to fund Phase I, Segment 1 of the Strander Boulevard project construction costs3.
'Spent on design plans. Remaining dollars will be moved to construction.
2 Maximum transfer requested. Recommend transferring what is actually required once the lowest responsible bid is secured.
3 Fund 317 will be amended at the end of the year through an amending 2005 budget ordinance to reflect this budget adjustment.
FI/Trans/Admin/Agenda 2005/050727 Agenda Bill—Supp 3
CITY OF REiN i vN COUNCIL AGENDA BILL
AI#:
Submitting Data: Planning/Building/Public Works Dept. For Agenda of: June 20,2005
Dept/Div/Board.. Transportation Systems Division
Staff Contact Sharon Griff n, ext. 7232 Agenda Status:
Consent
Subject: • Public Hearing X
Correspondence
Six-Year Transportation Improvement Program(TIP) Ordinance
and the Arterial Street Plan I Resolution X
Old Business
Exhibits: New Business
Issue Paper Study Sessions
Resolution
2006-2011 TIP Changes from Previous TIP
Draft TIP(2006-2011),including Project Map, Exhibit A, Information
and Map Index,Exhibit B,within document Other
Arterial Street Plan,Exhibit C Interlocal
Recommended Action: Approvals:
Refer to Transportation Committee and set Legal Dept... X
Public Hearing date of July 11, 2005 Finance Dept....... X
Fiscal Impact:
Expenditure Required N/A Transfer/Amendment
Amount Budgeted Revenue Generated
Summary of Action:
The City is required by law to annually review and adopt by resolution the Six-Year Transportation
Improvement Program(TIP). In;conjunction with this,the Arterial Street Plan is also updated.
The proposed TIP includes three new projects: Rainier Avenue—S 4th P1 to S 2nd, Hardie Ave: SW
Transit/Multi-modal,and the May Creek Bridge Replacement. Six completed or cancelled projects were
dropped from the program.
Staff Recommendations:
The Council adopt: 1)the annual updates to the"Six-Year Transportation Improvement Program";2)the
"Arterial Street Plan"; and, 3).set July.11, 2005, as the public hearing on the TIP. Staff further
recommends that the resolution regarding this matter be presented for reading and adoption.
H:Trans/planning/sgriffin/TIPs/2006_TIP_agendabill
• '
CITY OF RENTON
PLANNINGBUILDING/PUBLIC WORKS DEPARTMENT
MEMORANDUM
DATE: June 20,2005
TO: Terri Briere, Council President
Members of the Renton City Council
VIA: Kathy Keolker-Wheeler, Mayor
FROM: Gregg Zimmerman,Planning/Building/Public Works Administrator
STAFF CONTACT: Sharon Griffin, ext. 7232
SUBJECT: >12006-2011 Six-Year Transportation Improvement Program
(TIP)
ISSUE:
Should the City Council approve the resolution adopting the 2006-2011 Six-Year Transportation
Improvement Program(TIP)?
RECOMMENDATION:
Staff recommends Council adopt: 1)the annual updates to the"Six-Year Transportation
Improvement Program";2) the"Arterial Street Plan"; and 3) set July 11,2005 public hearing on .
the TIP.
BACKGROUND:
The City is required by law to annually review and adopt by resolution the Six-Year Trans-
portation Improvement Program(TIP). The draft TIPis presented to the Transportation
Committee and distributed to the rest of the Councilmembers for review in advance of the public
hearing. In addition to the projected revenues and expenditures for the future six years,the TIP
also includes current-year project allocations and past project expenditures.
The City Council adopted the previous Six-Year TIP—2005 through 2010, on July 26, 2004,as a
planning document for the next six years. It was distributed to the Puget Sound Regional
Council,the Washington State Department of Transportation,King County Department of
Transportation,the Association of Washington Cities,Puget Sound Energy, surrounding local
agencies,the library, and to internal departments.
Terri Brier,Council President -
Members of Renton City Council
June 20,2005
Page 2
Re: 2006-2011 Six-Year Transportation Improvement Program
A spreadsheet("2006-2011 Six-Year TIP Summary")is attached which outlines the expected
revenues and expenditures for the six-year period. The 2005 budget reallocation and increase of
$2,382,300 is included as an estimated expenditure to correspond with the reallocation
Ordinance 5134 (attached). Thelsix-year estimated expenditures were balanced to fall within the
expected revenues,leaving a balance of $42,011 on December 31,2011, for the combined Fund
317 and Fund 305.
The proposed six-year program 'required underfunding some future projects at this time to
achieve the successful'completion of other newly funded projects.
• Required funding levels for some of the newly funded projects were determined by the
receipt of funding from outside sources that required City match:
o #7 Rainier Avenue—S 4th P1 to S 2nd (Sound Transit funds)
o #8 Hardie Avenue SW Transit/Multi-modal (Sound Transit funds)
o #3 Strander Boulevard/SW 27th St,Phase 2, Segment 2a(State and federal funds)
o #45 SR 169 HO— 140th to SR 900,Phase 3 (State transportation budget)
o #19 May Creek Bridge Replacement is shown as a fully City funded project
pending a grant.
• Some of the newly funded projects were determined by economic development needs that
required City match:
o #12 South Lake;Washington Roadway Improvements(Proposed funding by sale
of-bonds)
o # 3 Strander Boulevard/SW 27th St,Phase 1=, Segment 1 (Proposed-funding by
sale of bonds)
• Some programs requested and received additional funding because of elevated priority:
o #1 Street Overlay Program
o # 10 Walkway Program
• Some projects which may be delayed due to the above needs are:
o #11 Rainier Avenue—SW 71"to 4th P1(the City is committed to 30%design and
re-evaluation of the escalated construction costs)
o #9 NE 31d/4th Corridor(limited funding has been allocated for small projects
along the corridor)
Ultimately, all projects in the TIP are presented to Council for review and approval,collectively
during the budget process, and individually when approval is requested for design and
construction contracts.
I:\TIPs12006\Council processUP 2006 TIP.doo
Terri Brier,Council President• •
Members of Renton City Council
June 20,2005
Page 3
Re: 2006-2011 Six-Year Transportation Improvement Program
Attachments
cc: Sandra Meyer,Transportation Systems Director
Nick Afzali,Planning and Programming Manager
Sharon Griffin,Program Development Coordinator
Nenita Ching,P/B/PW Administrative Analyst
Bang Parkinson,FIS/IS Supervisor
Project File
I:\TIPs\2006\Council process\IP 2006 TIP.doc
•
CITY OF RENTON
PLANNING/BUILDING/PUBLIC WORKS
TRANSPORTATION SYSTEMS DIVISION
2006 - 2011 SIX-YEAR TIP
SUMMARY OF FUNDING SOURCES
{
. , Period " f
ITEM • Period Total 2006 2007 2008 2009 2010 2011
SIX-YEAR PROJECT COSTS:
Project Development 3,535,000 • 744,000 620,100 532,100 '524,600 569,600 1544,600
Precon Eng/Admin 10,711,100 2,059,600 -- - 564,000 - - 155,500- -5,01-4,000 -VV--2;428,000 ' - 490,000
R-O-W(includes Admin) 10,272,000 2,949,000 650,000 5,500,000 1,173,000
Construction Contract Fee 123,511,390 27,314,890 9,865,700 4,508,700 37,747,700. 31,383,700 12,690,700
Construction Eng/Admin 11,785;600 2,503,500 1,058,400 419,800 3,772,300 3,047,300 984,300
Other . 1;809,500 346,000 464,000 347,000 407,500 . .122,500 . 122,500
Sub-TOTAL SIX-YEAR COST 161,624,590 35,916,990 13,222,200 5,963,100 52,966,100 38,724,100 14,832,100
SOURCE OF FUNDS:
Vehicle.Fuel Tax 3,410,000 440,000 565,000 585,000 595,000 610,000 • 615,000
Business License Fee 9,600,000 1,600,000 . 1,600,000 1,600,000 1,600,000 1,600,000 ' 1,600,000
Proposed Fund Balance 5,787,933. 1,352,800 - - 1,608,533 ' 280,000 908,600 893,000 745,000
Grants In-Hand ' 11,596,292' 5,155,000 3,724,892 ' 600,000 2,116,400
Mitigation In-Hand 7;068,575 1,400,800 ' 1,718,575 348,900 ' 749,500 1,417,900 1,432,°"^.
<;dBorids/L.I.D.'s Formed •;'1;8;939,000 • 15,507,000 3,432,000
Other In-Hand _ ' 13,988,390 . 10,461,390 573,200 2,549;200 306,200 . • 49,200 v 49,200
Sub-TOTAL SIX-YEAR FUNDED 70,390,190 35,916,990 13,222,200 5,963,100 6,275,700 - 4,570,100 _ 4,442,100
Grants Proposed V 2,084,000 . V `1,884,000 200,000
Mitigation Proposed
L.I.D.'s Proposed V
Other•Proposed v. 19,480,000 - 7-,780,000 5,700,000 6,000,000
Undetermined_ , - 69,670,400 - , 37,026,400 28,254,000 4,390,000
TOTAL SOURCES -FUNDED & UNFUNDED 161,624,590 .35,916,990 13,222,200 5,963,100 52,966,100 38,724,100 14,832,100
Summ of Source •
68/63!2665 6:22
• • 4 -2 FINAL • .
1 1 1 1 1 1 r I I ; I 1 I • , : I f
1 111) • -..
CITY OF RENTON
PLANNING/BUILDING/PUBLIC WORKS
TRANSPORTATION SYSTEMS DIVISION
2006-2011 SIX-YEAR TIP '
Bonds,/L:I.D.'s Formed*
Period
TIP Project Title 2006 2007 2008 2009 2010 2011 Total
1 Street Overlay Program -
2 SR 167/SW 27th St/Strander By
3 Strander By/SW 27th St Connect::' 3,000,000. 3,000,000 •
4 Renton Urban Shuttle(RUSH)
5 Transit Program •
6 Rainier Av Corridor Study!Improv.
7 Rainier Av-S 4th PI to S 2nd
8 Hardie Av SW Transit/Multi-modal - ,
9 NE 3rd/NE 4th Corridor _
10 Walkway Program
11 Rainier Av-SW 7th to 4th PI
12 S Lake Wash.Roadway Improv: 12,507,000 3,432,000 ;•15,939,CiOC
13 South Renton Project • _
14 1-405 Improvements in Renton _
15 Project Development/Predesign . .
16 NE 4th St/Hoquiam Av.NE
17 Arterial Circulation Program _.,
18 Bridge Inspection&Repair _ .
19 May Creek Bridge Replacement
20 Loop Replacement Program _
21 Sign Replacement Program
22 Pole Program _
23 Sound Transit HOV Direct Access •
24 Traffic Safety Program _
25 Traffic Efficiency Program _ _
26 CBD Bike&Ped.Connections .
27 Arterial Rehab.Prog.
28 Duvall Ave NE
29 RR Crossing Safety Prog.
30 TDM Program
31 Trans Concurrency _
32 Missing Links Program
33 GIS Needs Assessment
34 Grady Wy Corridor Study -
35 Bicycle Route Dev.Program
36 Lake Wash.By-Park to Coulon Pk •
37 School Zone Sign Upgrades •
38 Environmental.Monitoring
• 39 Trans-Valley&•Soos Creek Corr.
40 WSDOT Coordination Program •
41 1%for the Arts _
42 Arterial HOV Program .
43 Park-Sunset Corridor •
44 Lind Av-SW 16th-SW43rd
45 SR 169 HOV-140th to SR900
46 Benson Rd-S 26th to Main
47 Sunset/Duvall Intersection •
48 Logan Av Concrete Panel Repair
49 Carr/Mill Signal '
50 Houser Wy S-Main to Burnett
51 Lake Wash.By Slip Plane _
52 Monster Road Bridge _
53 Duvall Ave NE-King County
Total Sources 15,507,000 3,432,000 18,939,000
Bonde/n0kfamed 064712005 0.22
4-8 FINAL
•Bonding In process;no L.I.D.s formed.
.
i
CITY OF RENTON -
PLANNING/BUILDING/PUBLIC WORKS
TRANSPORTATION SYSTEMS DIVISION
2006-.2011 SIX-YEAR TIP
•
•
Strap;der=Boulward4 SW 27th Street Connection Functional Classification: Minor Arterial Fund: 317• 1
Proj.Length: 1.27 miles Proj: 122;36
.RANK: 3 CONTACT: Rob Lochmiiler 4251.430.7303
DESCRIPTION: STATUS:
This project provides a critical four/five lane arterial that will serve as a connector to West Valley Highway Up to 30%design was contracted in March 2003 for$2,213,349. It includes the
(SR-1.81)and East Valley Road,as well as an arterial connector to SR-167 from the south.The project will environmental documents,base-mapping,road sections,and project phasing by June
provide a grade-separated crossing at the Union Pacific Railroad(UPRR)and Burlington Northern Sante 2005. $1,000,000 was received from the General Fund in 2003. $745,563 TEA-21 was
Fe(BNSF)railroad tracks. Segments 1 and 2 include from West Valley Hwy to East Valley Road. obligated in May 2003 with an additional$2,398 obligated in May 2005. The design and
construction costs reflect Phases 1 and 2. Based upon staff discussions,Sound Transit is
anticipated to be a key funding partner.
JUSTIFICATION: CHANGES:
A new east-west arterial roadway will connect the_Cities of Renton and-Tukwila,an d.provide significant _*The City is in the process of applying for bonds. Nearing completion of 30%design for all
congestion relief to existing arterials. The new:road will provide direct access'to the new Tukwila Station, phases. Engineering estimates are lower than the planning-level estimates. Phase 1; -- - -
a multi-modal center being developed immediately north of the new alignment,and to the Boeing • Segment•1,is in full design with construction to start late 2005,early 2006 paid*with
t-ongacres site. The eventual direct HOV connections to southbound SR-167 will provide significant approximately$3 million in bonds. A shared-use detention pond with the developer will
' advantages to HOV and transit usage. By crossing under the UPRR and BNSF railroads,the new arterial lower the costa..of.construction. $500,000 Metro mitigation reserve is pending Council
•will provide significant benefits to both freight mobility and to general motorists. • approval. New fuel tax 2010. ;
• • . I Funded:1 13;753;9271 Unfunded:1 36,778,800
• Project Totals Programmed Pre-2006 Six-Year Program
ITEM Programmed Spent Pre-2005 2005 Total 2006 . 2007 2008 2009 2010 , 2011
EXPENSES: • .. _
Project Development •
s
Precon Eng/Admin 6,199,727 • 1,471,727 1,020_,000 3,708,000 850,000 • ' 2,350,000 508,000
R-O-W(includes Admin) 4,543,000 - . • 4,543,000 2,243,000 • 2,300,000
Construction Contract Fee 35,900,000_ 35,900,000• 2,970,000 1,570,000 , 26,760,000 . 4,600,000
. Construction.Eng/Admin • 3,890,000 . 3,890;000 • 306,000 . 180,000 2,764,000 640,000 '
Other
TOTAL EXPENSES 50,532,727 •.1,471,727 1,020,000 48,041,000 • 6,369,000 1,750,000 ' - • 34,174,000 5,748,000
SOURCES OF FUNDS:
Vehicle Fuel Tax 240,000L• 240,000 240,000
Business License Fee 237,349 237,349 • 82,749 .114,600 40,000 I _ '
Proposed Fund Bal./Reserve 772,617 '243,766 528,851 156,600 140,651 231,600
Grants In-Hand(State&Fed) 5,243,961 554,799 193,162 4,496,000 969,400 1,526,600 2,000,000
Mitigation In-Hand 760,000 500,000 • 260,000 . •100,000 160,000
Bonds/L.I.D.'s Formed .. 3,000,000 3,000,000 3,000,000
Other In-Hand(GF&Boeing) ' 3,500,000 416,928 583,072 • 2,500,000 2,243,000 . 257,000
Grants Proposed(Earmarks) 1,254,000 1,254,000' . 1,254,000
Mitigation Proposed
L.I.D's Proposed • .
Other Proposed(S.Transit) 4,000,000 4,000,000 4,000,000 .
Undetermined 31,524,800 • 31,524,800 26,216,800 5,308,000 '
TOTAL SOURCES 50,532,727 1,471;727 1',020,000 48;041,000' 6,369,000 1,750,000 34,174,000 ' 5,748,000, •
St=W.coi.roem •
08/0312005 622 AM
• 5-3 FINAL •
CITY OF RENTON,WASHINGTON
RESOLUTION NO. 3772
A RESOLUTION OF THE CITY OF RENTON, WASHINGTON
DECLARING.ITS INTENT THAT CERTAIN CAPITAL EXPENDITURES
SHALL BE REIMBURSED FROM THE PROCEEDS OF TAX EXEMPT
BONDS OR OTHER OBLIGATIONS.
WHEREAS,the City of Renton(the"City")plans to undertake the following capital
projects: the Southwest 27th Street/Strander Boulevard Capital Improvement Project and the
South Lake Washington Roadway/Utilities Capital Improvement Project(the"Projects"); and
WHEREAS, the City plans to finance the Projects through the issuance of tax-exempt
bonds or other obligations of the City in one or more issues in an amount not to exceed
$15,000,000 (the"Bonds");
NOW,THEREFORE,THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON,DOES RESOLVE AS FOLLOWS:
SECTION L The above findings are true and correct in all respects.
SECTION IL For the purpose of complying with the provisions of the Treasury
Regulation Section 1.150-2 with respect to qualification of reimbursement allocations as
expenditures of bond proceeds,I pending the issuance of the Bonds, the City may make capital
expenditures in furtherance of the Projects, in anticipation of reimbursement for such expenditures
from the proceeds of the Bonds, when issued.
PASSED BY THE CITY COUNCIL this 19th day of sept ember , 2005.
taLite-"..)
Bonnie I. Walton, City Clerk
1
• RESOLUTION NO. 3772
APPROVED BY THE MAYOR this 19th day of September , 2005.
. .i /11/ 4reletl ' akeei-k.
Kathy K-siker-Wheeler, Mayor
Approved as to form:
C2(a ,
Lawrence J. Warren, Attorney
RES.1127:9/20/05:ma
2
September 19,2005 - Renton City Council Minutes Page 318
Utilities Committee Utilities Committee Chair Corman presented a report recommending
Latecomer Agreement: concurrence in the staff recommendation to grant preliminary approval of the
Wyman/Blood, Sewer application for a latecomer agreement request from Kevin M. Wyman and
Extension (SE 132nd St),LA- Durwood E. Blood for a period of one year. The application for latecomer
05-003 agreement was submitted to recover the$60,290.92 estimated cost of sewer
extension along SE 132nd St. at 152nd Ave. SE to allow development of two
single-family residences without the need for a previously approved site sewage
system.
The Committee further recommended that Council authorize the preliminary
assessment roll to be forwarded to the City Clerk, who will notify the affected
property owners. If no protests are received, after construction of the facilities
and approval of the final costs, Council can authorize preparation of the final
assessment roll and latecomer agreement. In the event there is a protest for
valid cause, a public hearing will be held to resolve any issues prior to
proceeding with this matter. MOVED BY CORMAN, SECONDED BY
CLAWSON, COUNCIL CONCUR IN THE COMMITTEE REPORT.
CARRIED.
Planning &Development Planning and Development Committee Chair Clawson presented a report
Committee recommending a public hearing be set on 10/3/2005 to consider the zoning text
Planning: Residential Uses in amendments residential uses in the Commercial Arterial zone. MOVED BY
Commercial Arterial Zone CLAWSON, SECONDED BY LAW, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
RESOLUTIONS AND The following resolution was presented for reading and adoption:
ORDINANCES
Resolution#3772 A resolution was read declaring the City's intent that certain capital
Finance: Bond Proceed expenditures shall be reimbursed from the proceeds of tax exempt bonds or
Reimbursement, S Lake WA other obligations in an amount not to exceed$15,000,000. MOVED BY LAW,
Roadway &SW 27th SECONDED BY NELSON, COUNCIL ADOPT THE RESOLUTION AS
St/Strander Blvd Connection, READ. CARRIED.
Capital Expenditures
The following ordinances were presented for first reading and referred to the
Council meeting of 9/26/2005 for second and final reading:
Planning: Development An ordinance was read amending Chapters 4-1,4-2,4-4,4-6 through 4-9, and
Regulations (Title IV)Docket 4-11 of Title IV(Development Regulations) and Chapter 9-11 of Title IX
&Amendments (Public Ways and Property)of City Code by clarifying zone density controls
over zone lot size provisions and removing Green River Valley landscaping
requirements; and by amending administrative, interpretation, and enforcement
procedures; fees and fee refunds and waivers; binding site plan regulations;
planned unit/urban development regulations; nonproject SEPA requirements;
and definitions. MOVED BY CLAWSON, SECONDED BY LAW, COUNCIL
REFER THE ORDINANCE FOR SECOND AND FINAL READING ON
9/26/2005. CARRIED.
Planning: Growth An ordinance was read adding Section 4-8-110.A.7 and 4-8-110.I to Chapter 8,
Management Hearings Board, Permits -General and Appeals, of Title IV (Development Regulations)of City
Filing of Appeals Code regarding the filing of appeals to the Growth Management Hearings
Board. MOVED BY CLAWSON, SECONDED BY LAW, COUNCIL REFER
THE ORDINANCE FOR SECOND AND FINAL READING ON 9/26/2005.
CARRIED.
September 19,2005 Renton City Council Minutes Page 316
Franchise: Sprint Development Services Division recommended approval of a master use
Communications,Fiber Optic agreement with Sprint Communications Company L.P. to install fiber optic
Communication Facilities communication facilities within the City of Renton right-of-way. Refer to
Transportation(Aviation) Committee.
MOVED BY BRIERE, SECONDED BY NELSON, COUNCIL APPROVE
THE CONSENT AGENDA AS PRESENTED. CARRIED.
UNFINISHED BUSINESS Transportation(Aviation) Committee Chair Palmer presented a report
Transportation(Aviation) recommending concurrence in the staff recommendation to authorize the Mayor
Committee and City Clerk to execute Supplemental Agreement#6 with Perteet, Inc.,for
CAG: 01-071, Maple Valley additional work in the amount of$99,880 for the Maple Valley Hwy. (SR-169)
Hwy Improvements, Perteet Improvements Project Phase 2. The Committee further recommended that
Council;authorize funds to be transferred into this project from the following
projects:
1. Project Development/Predesign in the amount of$25,000;
2. Arterial Circulation Program in the amount of$39,880;
3. Duvall Ave. NE in the amount of$20,000;
4. Transportation Concurrency in the amount of$40,000; and
5. Interagency Signal Coordination in the amount of$5,000.
MOVED BY PALMER, SECONDED BY CORMAN, COUNCIL CONCUR
IN THE COMMITTEE REPORT. CARRIED.
Airport: Layout Plan Update, Transportation(Aviation) Committee Chair Palmer presented a report
URS Corporation recommending concurrence in the staff recommendation to approve the contract
with URS Corporation in the amount of$129,257.19 to update the Airport
Layout Plan. The Committee further recommended that the Mayor and City
Clerk be authorized to sign the contract. MOVED BY PALMER, SECONDED
BY CORMAN, COUNCIL CONCUR IN THE COMMITTEE REPORT.
CARRIED.
Finance Committee Finance,Committee Chair Persson presented a report regarding reimbursement
Finance: Bond Proceed of capital expenditures from proceeds of tax exempt bonds. The Committee
Reimbursement, S Lake WA recommended concurrence in the staff recommendation to declare the City's
Roadway&SW 27th intent that certain capital expenditures to be made on the South Lake
St/Strander Blvd Connection, Washington roadway and SW 27th St./Strander Blvd connection capital
Capital Expenditures projects,shall be reimbursed from the future proceeds of a tax exempt bond
sale(s)or other obligations of the City in an amount not to exceed$15,000,000.
The Committee further recommended that the resolution regarding this matter
be presented for reading and adoption.*
Councilman Persson noted that the Committee changed the bond sale amount
from the original recommendation of$31,000.000 to$15,000,000. He
indicated that the Committee will revisit the matter as more information is
obtained about the projects.
*MOVED BY PERSSON, SECONDED BY NELSON, COUNCIL CONCUR
IN THE COMMITTEE REPORT. CARRIED. (See page 318 for resolution.)
Mayor Keolker-Wheeler indicated that the$15,000,000 will not cover the costs
of the projects.
• APPROVE Y
CDTVCOUNCiL
• FINANCE.COMMITTEE' Date 9-/9'�aos .
. ; COMMITTEE REPORT -
. •
September 19,2005 � •
•
• .• REIMBURSEMENT OF CAPITAL.EXPENDITURES • ,
FROM PROCEEDS OF TAX EXEMPT BONDS
• (August:15, 2005). . : , ' , • f. -
L. .
• ""The'Finance Committee recommends'co °
ncurrence i 'the„staff recommendation-to declare the •
City's intent.that certain-capital: expenditures to be made=-on'the. South Lake Washington- .• '
' ' 'Roadway and SW 27th Street/Strander,;Boule'ardr.Capital;Pr-ojects 'shall,be reimbursed-from . - .'
the future:proceeds ofa tax-exempt„Bond sale(s)•or otherzobligat ons of the City in an amount: • i •
not to.exceed$15,000,00y0. ,
The Committee further recommends':that,the•Resolution regarding this matter be presented for '
reading and'adoptiori: i 1 *,?1„:":"Ir;,;4: z
a,. �<<
• " -Don Persson,:Chair. • .
Ton Nelson;Vice - air
- Denis.W:°Law, Member '
• cc. Michael E Bailey;Finance&Information Services Administrator• .: ". _ ' .. ,
• Gregg Zimmerman,PlahningBuilding/Public Works Administrator - " ' ;
Linda.Parks,Fiscal Services Director'
August 15,2005 Renton City Council Minutes Page 292
CAG: 05-114,Riverview Park City Clerk reported bid opening on 8/4/2005 for CAG-05-114,Riverview Park
Bridge Renovation,Marine Bridge Renovation; six bids; engineer's estimate$185,000; and submitted staff
Vacuum Service recommendation to authorize the use of excess budget from completed projects
and award the contract to the low bidder,Marine Vacuum Service,Inc., in the
amount of$207,500. Council concur.
Development Services: Federal Development Services Division recommended adoption of the Federal National
National Incident Management Incident Management System(NEVIS), which provides a consistent nationwide
System approach to responding to and recovering from domestic incidents and is
required by all local governments for future grant eligibility. Council concur.
(See page 295 for resolution.)
Annexation: Park Terrace, SE Economic Development,Neighborhoods and Strategic Planning Department
112th St&Anacortes Ave NE recommended a public hearing be set on 9/12/2005 to consider the proposed
Park Terrace Annexation and future zoning,the boundaries of which were
expanded by the Boundary Review Board from 7.65 to 80 acres. The site is
located south of SE 112th St., if extended, and east of Anacortes Ave. NE to
144th Ave. SE. Council concur.
Finance: Bond Proceed Finance and Information Services Department recommended authorizing capital
Reimbursement, S Lake WA expenditures on the South Lake Washington roadway and SW 27th St./Strander
Roadway&SW 27th Blvd.extension projects in anticipation of reimbursement from the proceeds of
St/Strander Blvd Extension tax-exempt bonds or other obligations. Refer to Finance Committee.
Capital Expenditures
Human Services: 2006 CDBG Human Services Division recommended setting a public hearing on 9/19/2005
Funds Allocation to consider the allocation of 2006 Community Development Block Grant funds
as recommended by the Human Services Advisory Committee. Refer to
Community Services Committee; set public hearing on 9/19/2005.
Transportation: Commute Trip Transportation Systems Division recommended approval of an agreement with
Reduction Program Grant, Washington State Department of Transportation to accept funds in the amount
WSDOT of$38,435 for the Commute Trip Reduction program. Council concur. (See
page 295 for resolution.)
Transportation: Commute Trip Transportation Systems Division recommended approval of an agreement in the
Reduction Program Services, amount of$35,828 with King County Department of Transportation to provide
King County Commute Trip Reduction services to 21 affected employers in the City of
Renton for 2005-2006. Council concur.
Sound Transit: Phase II Work Transportation Systems Division recommended approval of the list of
Plan,Renton Prioritized prioritized projects within Renton for inclusion in the Sound Transit Phase 2
Project List (ST2) work plan. Refer to Transportation(Aviation) Committee.
CAG: 03-033, SW 27th Transportation Systems Division recommended approval of Supplemental
St/Strander Blvd Extension Agreement No. 3 to CAG-03-033,agreement with Perteet Engineering, Inc. for
Design,Perteet Engineering the SW 27th St./Strander Blvd. extension project,for construction management
services in the amount of$110,846. Approval was also sought for a budget
adjustment to the Transportation Fund to cover the construction costs. Refer to
Transportation(Aviation) Committee.
Utility: Hazen 565 Pressure Utility Systems Division recommended approval of an agreement with RH2
Zone Reservoir Design,RH2 Engineering, Inc. in the amount of$229,608 to design the Hazen 565 Pressure
Engineering Zone Reservoir, which will serve the Renton Highlands by providing 1 million
gallons of additional water storage. Council concur.
CL)Ar OF RENTON COUNCIL AGENDA MILL
AI#: 7., e
Submitting Data: For Agenda of:
Dept/Div/Board.. Finance & IS Department August 15, 2005
Staff Contact Michael R. Wilson, Interim Agenda Status
Finance/IS Administrator Consent X
Subject: Public Hearing..
Correspondence..
Reimbursement Resolution for the South Lake Ordinance
Washington Roadway and SW 27th Street/Strander Resolution X
Boulevard Capital Projects Old Business
Exhibits: New Business
Study Sessions
Memorandum Information
Resolution
Recommended Action: Approvals:
Legal Dept
Refer to Finance Committee Finance Dept
Other
Fiscal Impact:
Expenditure Required... Transfer/Amendment
Amount Budgeted Revenue Generated
Total Project Budget City Share Total Project..
SUMMARY OF ACTION:
Work on the South Lake Washington Roadway and SW 27th Street/Strander Boulevard Capital
Projects will begin before debt financing is completed by issuance of tax-exempt Bonds or other
obligations. The proposed Resolution enables the City to make capital expenditures on these
projects in anticipation of expenditure reimbursement from the proceeds of the Bonds.
STAFF RECOMMENDATION:
Authorize capital expenditures on South Lake Washington Roadway and SW 27th
Street/Strander Boulevard Capital Projects prior to completion of debt financing, and adopt the
related Resolution.
C:\Documents and Settings\mpetersen\Local Settings\Temp\Reimbursement Resolution_Bonds.doc
(f.,YO FINANCE AND INFORMATION SERVICES
® •, DEPARTMENT
MEMORANDUM
DATE: August 8,2005
TO: Tern Briere, Council President
Members of the Renton City Council
VIA: ji athy Keolker-Wheeler,Mayor
CC: u`" JayCovington, Chief Administr.tive,gt e Officer
FROM: Michael R. Wilson, Interim Al i.d
SUBJECT: Reimbursement Resolution for the South Lake Washington
Roadway and SW 27th Street/Strander Boulevard Capital Projects
The City of Renton is in the process of undertaking two sizable capital improvement
projects that will be debtifinanced through the issuance of general obligation bonds:
South Lake Washington Roadway/Utilities Capital Improvement Project and the SW 27th
Street/Strander Blvd. Capital Improvement Project. Since the City is likely to proceed
with one or more of these upcoming capital projects before the issuance of any bonds, the
City should have a reimbursement resolution in place before ground is broken on these
projects. By having a reimbursement resolution in place prior to work on these projects,
the City will be able to be reimbursed from the bond proceeds once the bonds are issued.
A draft of the proposed Resolution is attached.
1
MRW/dlf •
Attachment,as stated
cc: Linda Herzog,Interim Assistant to the CAO
• Bonnie Walton,City Clerk
Gregg Zimmerman,PlanningBuilding/Public Works Administrator
Linda Parks,Fiscal Services Director
h:\finance\adminsup\02_issuepapers_memos to council or mayor\reimbursement resolution.doc
CITY OF RENTON,WASHINGTON
RESOLUTION NO.
A RESOLUTION OF THE CITY OF RENTON, WASHINGTON
DECLARING ITS INTENT THAT CERTAIN CAPITAL EXPENDITURES
SHALL BE REIMBURSED FROM THE PROCEEDS OF TAX EXEMPT
BONDS OR OTHER OBLIGATIONS.
WHEREAS, the City of Renton(the"City")plans to undertake the following capital
projects: the Southwest 27th Street/Strander Boulevard Capital Improvement Project and the
South Lake Washington Roadway/Utilities Capital Improvement Project(the"Projects"); and
WHEREAS,the City plans to finance the Projects through the issuance of tax-exempt
bonds or other obligations of the City in one or more issues in an amount not to exceed
$31,400,000(the"Bonds");
NOW,THEREFORE,THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON,DOES RESOLVE AS FOLLOWS:
SECTION L The above findings are true and correct in all respects.
SECTION IL For the purpose of complying with the provisions of the Treasury
Regulation Section 1.150-2 with respect to qualification of reimbursement allocations as
expenditures of bond proceeds, pending the issuance of the Bonds, the City may make capital
expenditures in furtherance of the Projects,in anticipation of reimbursement for such expenditures
from the proceeds of the Bonds,when issued.
PASSED BY THE CITY COUNCIL this — day of , 2005.
Bonnie I. Walton, City Clerk
1
RESOLUTION NO.
APPROVED BY THE MAYOR this day of , 2005.
Kathy Keolker-Wheeler, Mayor
Approved as to form:
Lawrence J. Warren, City Attorney
RES.1127:8/8/05:ma
2
April 11,2005 Renton City Council Minutes Page 126
+fir
Development Services: Development Services Division recommended approval, with conditions, of the
Heritage Glen,NE 20th St,FP- Heritage Glen Final Plat, aka Westchester Kennydale; 37 single-family lots on
04-147 6.38 acres located in the vicinity of NE 20th St. and Monterey Ave. NE(FP-04-
147). Council concur. (See page 129 for resolution.)
Airport: Development Study Transportation Division recommended approval of the Renton Municipal
Airport Development Study and approval of the eight policy recommendations.
Refer to Transportation(Aviation) Committee.
MOVED BY BRIERE, SECONDED BY PERSSON, COUNCIL APPROVE
THE CONSENT AGENDA AS PRESENTED. CARRIED.
CORRESPONDENCE Correspondence was read from David J. Gates,President and CEO of Net
Citizen Comment: Gates-Net Assets Corporation,44 Club Rd.,Eugene, OR, 97401,regarding an
Assets Corporation Services administrative decision not to use the services of the Net Assets Corporation.
MOVED BY BRIERE, SECONDED BY PERSSON, COUNCIL REFER THIS
CORRESPONDENCE TO THE ADMINISTRATION. CARRIED.
UNFINISHED BUSINESS Assistant City Attorney Zanetta Fontes noted receipt of a letter from David S.
Citizen Comment: Mann- Mann,Herons Forever representative, 1424 4th Ave., Suite 1015, Seattle,
Sunset Bluff Preliminary Plat 98101,regarding the Sunset Bluff Preliminary Plat. Mr. Mann asked that
Appeal, SR 900 LLC& Council take no action on SR 900 LLC's request for reconsideration, or if
Herons Forever,PP-04-002 Council does reconsider its decision of 3/21/2005, that it amend condition 2 to
prohibit all forest clearing, hillside grading, and construction activities between
January 15 and July 31 in any year that such work is necessary.
There was no motion to take action on the matter; therefore, the motion to
reconsider(which was made at the 4/4/2005 Council meeting) failed.
Committee of the Whole Council President Briere presented a Committee of the Whole report
Public Works: SW 27th St recommending concurrence in the staff recommendation to approve the
Improvements, Bond Issuance, agreement with the Federal Reserve Bank of San Francisco regarding the SW
Federal Reserve Bank 27th St.parcel and stormwater detention parcel, and authorize the Mayor and
Agreement City Clerk to execute the agreement. The Committee further recommended
concurrence in the staff recommendation to authorize the expenditure of
$3,000,000 to pay for the City's share of the roadway project,recognizing that
the City will ultimately issue bonds to pay for this project. MOVED BY
BRIERE, SECONDED BY NELSON, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Council: Filling Council Council President Briere presented a Committee of the Whole report regarding
Vacancies Policy(#800-10) the update to Council Policy and Procedure#800-10,Filling Council
Vacancies. The Committee reviewed the policy and recommended revisions to
allow Council the option, prior to selecting a candidate as the new
councilmember, of whether or not to conduct interviews of person(s) who
submit a letter of interest. This change will allow Council to select or
interview, by majority vote, only a selected candidate or candidates, rather than
requiring that all persons submitting a letter of interest be interviewed. The
Committee also recommended that the Council President be authorized to sign
revised Policy and Procedure#800-10 to implement this change. MOVED BY
BRIERE, SECONDED BY PERSSON, COUNCIL CONCUR IN THE
COMMITTEE REPORT.*
Councilman Clawson stated that instead of having a mandatory public
interview of all applicants, the new process affords Council the ability to
interview only a selected applicant or applicants. He emphasized that it is
ti
C311'l t uvCtlL.
Date_'I-//--,1005
COMMITTEE OF THE WHOLE
'COMMITTEE REPORT
April 11, 2005
Agreement with the Federal Reserve Bank Regarding the 27th Street Parcel/Stormwater
Detention Parcel
(Referred April 4, 2005)
The Committee of the Whole recommends concurrence in the staff recommendation to
approve the Agreement with the Federal Reserve Bank regarding the 27th Street
Parcel/Stormwater Detention Parcel and.authorize .the Mayor and City Clerk to execute the
Agreement. The Committee further recommends concurrence in the staff recommendation to
authorize the expenditure of $3,000,000 to pay for the,City's share of the roadway project,
recognizing that the City will ultimately issue bonds:to`pay,for fhis project.
/
Terri :riere, Council President..; . , :;
cc: Gregg Zimmerman
Alex Pietsch
Sandra Meyer
Leslie Lahndt
Rob Lochmiller
Michael Wilson
Fed Reserve Bankcowreport4_11.doc\ rev 01/05 bh
April 4,2005 Renton City Council Minutes Page 112
Councilman Law stated that the event should be cost neutral to taxpayers.
*MOTION CARRIED.
CONSENT AGENDA Items on the consent agenda are adopted by one motion which follows the
listing. At the request of Councilwoman Palmer, items 8.h. and 8.i. were
removed for separate consideration.
Council Meeting Minutes of Approval of Council meeting minutes of March 21, 2005. Council concur.
March 21, 2005
Court Case: Renton Police Court Case filed on behalf of the Renton Police Officers'Guild by Aaron D.
Officers Guild, CRT-05-002 Jeide, Cline&Associates, 999 3rd Ave., Suite 3800,Seattle,98104, alleging
that the City has no legitimate interest in compelling Police Officer Steve
Morris to submit to a mental evaluation. Refer to City Attorney and Insurance
Services.
Annexation: Akers Farms, Economic Development,Neighborhoods and Strategic Planning Department
108th Ave SE&SE 164th St submitted 10%Notice of Intent to annex petition for the proposed Akers Farms
Annexation, 13.61 acres located in the vicinity of 108th Ave. SE and SE.164th
St., and recommended a public meeting be set on April 18, 2005,to consider
the petition. Council concur.
Plat: Aspen Woods,Hoquiam Hearing Examiner recommended approval, with conditions, of the Aspen
Ave NE,PP-04-143 Woods Preliminary Plat;46 single-family lots on 8.15 acres located at 852 and
864 Hoquiam Ave.NE(PP-04-143). Council concur.
Plat: Parklane Court,Lyons Hearing Examiner recommended approval, with conditions, of the Parklane
Ave NE,PP-04-142 Court.Preliminary Plat;ten single-family lots on 4.3 acres located at the 100
block of Lyons Ave. NE(PP-04-142). Council concur.
Police: Domestic Violence Police Department recommended approval of the Edward Byrne Memorial
Advocacy Assistance Program, Justice Assistance Grant in the amount of$39,120 to help fund the Domestic
Edward Byrne Memorial Violence Advocacy Assistance Program. Council concur.
Justice Assistance Grant
Lease: Aerodyne Aviation Transportation Systems Division recommended approval of Addendum#11 to
Addendum#11,Airport,LAG- LAG-84-006,Airport lease with Aerodyne Aviation,to increase the leased
84-006 square footage. Refer to Transportation(Aviation) Committee.
Utility: SW 34th St Culvert Utility Systems Division recommended approval of a contract in the amount of
Replacement Design, RW $116,049 with R.W. Beck,Inc. for the SW 34th St. Culvert Replacement
Beck Project design. Council concur.
Added Item 8.k. Planning/Building/Public Works Department recommended approval of an
Public Works: SW 27th St agreement with the Federal Reserve Bank of San Francisco regarding the SW
Improvements,Bon d Iss nice, 27th St. parcel and the stormwater detention parcel, and recommended
Federal Reserve Bank authorization to issue$3,000,000 in bonds to pay for the City's share of the SW
Agreement 27th St. and Strander Blvd. extension project. Refer to Committee of the
Whole.
MOVED BY BRIERE,SECONDED BY LAW, COUNCIL APPROVE THE
CONSENT AGENDA AS AMENDED TO REMOVE ITEMS 8.h. AND 8.i.
FOR SEPARATE CONSIDERATION. CARRIED.
Separate Consideration Transportation Systems Division recommended approval of the temporary
Item 8.h. street closures of Lake Washington Blvd. NE, in the vicinity of NE 50th St., for
Streets: Lake Washington Blvd the Lake Washington Blvd. Slip Plane Project. Closures to take place April 15
NE Temporary Closures through July 15, 2005.
• /Wel THA'11
Cr..— OF RENTON COUNCIL AGENDA ��LL
AI//: t ��
Submitting Data: Planning/Building/Public Works For Agenda of: April 4, 2005
Dept/Div/Board.. Department Administration
Staff Contact Gregg Zimmerman (Ext. 7311) Agenda Status
Consent X
Subject: i Public Hearing..
Agreement with the Federal Reserve Bank Regarding Correspondence..
the 27th Street Parcel/Storm water Detention Parcel Ordinance
Resolution
Old Business
Exhibits: New Business X
Issue Paper Study Sessions
60% Road Design Cost Estimate Information
Agreement
Roadway Graphic
Recommended Action: Approvals:
Refer to Committee of the Whole, April 11, 2005 Legal Dept X
Finance Dept X
Other
Fiscal Impact:
Expenditure Required... $3,000,000.00 Transfer/Amendment
Amount Budgeted $0.00 Revenue Generated $3,000,000.00
(Bond Issue)
Total Project Budget $0.00 City Share Total Project.. $3,000,000.00
SUMMARY OF ACTION:
Enter into an Agreement with the'Federal Reserve Bank to construct segment I of the SW 27th
St./Strander Blvd. Extension project. This will be a five-lane segment extending from
Oakesdale Ave. SW west to the access driveway to the proposed Federal Reserve Bank. This
project will include a water quality/detention pond shared by the City and the Federal Reserve
Bank. The Federal Reserve Bank will pay for the water line, the sewer line, franchise utilities,
and a proportionate share of the storm water detention tract and facility. The City's cost will be
approximately $3,000,000.00 and will be obtained through issuance of bonds.
STAFF RECOMMENDATION:
Authorize the Mayor and City Clerk to execute the Agreement with the Federal Reserve Bank
Regarding the 27th Street Parcel/Storm water Detention Parcel. Authorize the Administration to
issue $3,000,000.00 in bonds to pay for the City's share of the roadway project.
Rentonnet/agnbill/ bh
1• r
(-
CITY OF RENTON
PLANNING/BUILDING/PUBLIC WORKS DEPT.
MEMORANDUM
DATE: April 4, 2005
TO: ITerri Briere, Council President
Members of the Renton City Council
VIA: Kathy Keolker-Wheeler, Mayor-0
FROM: Gregg`Zink erman,PBPW Administrator
STAFF CONTACT: Gregg Zimmerman(x-7311)
SUBJECT: Agreement with the Federal Reserve Bank Regarding
the 27th Street Parcel/Storm water Detention Parcel
ISSUE:
j -
The Administration has conducted negotiations with the Federal Reserve Bank to build
Segment 1 of the first phase of the SW 27th St./Strander Blvd. roadway project. These
negotiations have resulted in preparation of the attached Agreement (the "Agreement")
with the Federal Reserve Bank regarding the 27th Street Parcel/Storm water Detention
Parcel. This Agreement establishes the respective responsibilities of the City of Renton
and the Federal Reserve BankIto fund and construct this segment of the roadway project
along with storm water facilities and City and franchise utilities. The City's share of the
cost of the project would be financed through issuance of bonds.
RECOMMENDATION: �
Authorize the Mayor.and City'Clerk to execute the Agreement with the Federal Reserve
Bank Regarding the 27th-Street Parcel/ Storm water Detention Parcel. Authorize the
Administration to issue $3,000,000.00 in bonds to pay for the City's share of the roadway
project.
BACKGROUND: .
•
For a number of years the City has been working on the planning and design of a five-
lane arterial roadway that would connect SW 27th Street in Renton with Strander Blvd. in
Tukwila. Such a roadway would benefit Renton and the region by providing another
much-needed east-west trans-valley corridor to improve freight and commuter mobility,
remove traffic from the congested SW 43`d/S. 180th St. Corridor, and provide access to
the Longacres Commuter Rail Station from the east. This roadway would also improve
access to the Renton Valley and support economic development in this area of the City.
H:\Division.sWDMIN\GREGG\FRBagreementissue.doc\g
Page 2.
The Strander/SW 27th Street Extension project is very costly because it involves grade-
separated crossings over two rail lines. Development of the project has been slowed by
the need to obtain adequate funding. The City entered into an Agreement with the
Boeing Company that resulted in the dedication of a 90-foot wide right-of-way through
the Boeing Longacres property to accommodate the roadway project.
An opportunity has now presented itself to build an approximately 1,700-foot segment of
the roadway starting in late 2005 or early 2006. This segment would extend from
Oakesdale Ave. westward to the driveway of the proposed Federal Reserve Bank facility
located on the Boeing Longacres property. In late 2004 the City Council approved use of
$197,437 of transportation improvement funding to design this segment of the project.
Early construction of this segment of the road would yield several benefits. The cost of
the roadway segment would be identified as local matching funds for our ongoing grant
applications for the Strander Extension project. This would improve our chances of
securing additional grant funding. It would also demonstrate the City's resolve to build
the roadway to other important stakeholders such as Tukwila, the Boeing Company,
Sound Transit, and our State and Federal legislators who have recently worked to secure
financial support for the project. It would provide a high quality primary access roadway
for the Federal Reserve Bank and add incentive for future development of the Longacres
site. The proposed joint use of a water quality/detention pond for both the FRB facility
and segment 1 of the roadway will result in a savings of approximately $1,000,000
compared to the cost of a concrete vault under the roadway. A financial analysis
indicates that development of the FRB facility will result in one-time tax revenues of
approximately $200,000 and annual revenues of$130,000 which could be used to offset
the cost of debt service for the bonds. In addition to these considerations, construction of
segment 1 of the roadway will help to satisfy a condition of the earlier Boeing Agreement
that would allow the 90-foot right-of-way to revert back to Boeing ownership if the road
is not built.
For these reasons the Administration strongly recommends that the City enter into the
Agreement with the Federal Reserve Bank to construct segment 1 of the first phase of the
SW 27th Street/Strander Blvd. Extension project. Construction of Segment 1 of the first
phase of the Strander Blvd. Extension project would be funded by issuance of bonds in
the amount of$3,000,000.00. Approval of this Agreement is therefore reliant on Council
approval of the issuance of bonds in the amount needed to build this project. It is the
Administration's intention to roll this bond issuance into the proposed bond issuance to
build the Lakeshore Landing roadway and utility improvements.
PROVISIONS OF THE AGREEMENT:
The main provisions of the Agreement are as follow:
> The schedule of construction for the road shall be no later than is set forward in
Schedule D of the Agreement.
H:\Divisions\ADMIN\GREGG\FRBagreementissue.doc\g
140
1 '
Page 3.
> The water line shall be paid for by the Federal Reserve Bank and the property
seller except that any costs in excess of$278,815 shall be borne by the City.
> The sewer line shall be paid for by the Federal Reserve Bank and the property
seller except that any costs in excess of$90,000 shall be borne by the City.
> The Federal Reserve Biank shall pay for design and construction of the franchise
utilities (i.e. electricity, natural gas, cable television, data/voice communications,
etc.). If the franchise utility plans are available they will be placed into the
roadway contract documents so that installation of the franchise utilities can be
coordinated with the road construction.
> Provisions that the Federal Reserve Bank and the City have rights to complete the
project and be compensated for their work in case of default of the other agency.
> The Federal Reserve Bank shall purchase the Stormwater Detention parcel at a
cost estimated to be 1$847,484.00. This parcel shall be the site of a water
quality/detention facility jointly used by the Federal Reserve Bank and the City
road project. Each party shall pay their proportionate share of both the cost of this
parcel and the cost of the design and construction of the water quality/detention
facility based upon the,amount of peak runoff calculated to enter the facility from
the two respective projects. The Federal Reserve Bank shall purchase the
property and the City shall reimburse them upon substantial completion of the
construction of the water quality/detention facility.
> The Federal Reserve Bank shall design the water quality/detention facility and the
plan.drawings shall be incorporated into the road project plan set. The City shall
construct this facility as part of the roadway construction project.
> The Stormwater Parcel and the water quality/detention facility shall be dedicated
to the City by the Federal Reserve Bank. The City shall be responsible for
operating the facility and performing basic (functional) and enhanced
maintenance (aesthetic) items on the facility. All costs of basic maintenance shall
be borne by the City, and all costs of enhanced maintenance shall be borne by the
Federal Reserve Bank. However, should the City require that certain aesthetic
gateway features be incorporated into the detention pond design, the City shall be
responsible for the costs of maintaining such features.
cc: Jay Covington
Larry Warren
Alex Pietsch
Sandra Meyer
Leslie Lahndt
Rob Lochmiller
H:\Division.s\ADMIN\GREGG\FRBagreementissue.doc\g
` I; OPINION OF COST Perteet Inc.
Strander Boulevard Extension Project - Stage 1
East of RR Tracks to Oakesdale Ave.SW
60% ESTIMATE
February 2005
ITEM UNITS QUANTITY UNIT PRICE AMOUNT
SC,HED. .LEA?.Roadwa` Im 'rovements, r ta41t11.1 #sxd Wii 3 /01,'".`':: K mart'" :ll,;_fM
Mobilization (10%) LS 1 $171,900 $171,900
SPCC Plan LS 1 $3,000 $3,000
Record Drawings LS 1 $6,000 $6,000
Traffic Control Labor HR 1920 $36 $69,120
Temporary Traffic Control Devices LS 1 $10,000 $10,000
Sawcut 1 LF 155 $3 $465
Remove Existing ACP i SY 4480 $7 $31,360
Remove Existing Cement Concrete ; SY 280 $7 $1,960
Clearing and Grubbing AC 4 $5,000 $20,000
Remove Structure and Obstruction LS 1 $5,000 $5,000
Roadway Excavation Including Haul ; CY 1200 $15 $18,000
Structure Excavation, Class B Incl. Haul CY 1150 $15 $17,250
Shoring or Extra Excavation Class B'; SF 2450 $1 $2,450
Gravel Borrow, Incl. Haul TON 38700 $13 $503,100
Crushed Surfacing Top Course I TON 280 $22 $6,160
Crushed Surfacing Base Course TON 2270 $22 $49,940
Hot Mix Asphalt Class 1/2"PG 58-22' TON 2740 $50 $137,000
Hot Mix Asphalt Class 1" PG 58-22 TON 5340 $50 $267,000
Storm Sewer Pipe,8"Dia. LF 10 $35 $350
Storm Sewer Pipe, 12"Dia. LF 880 $35 $30,800
Storm Sewer Pipe, 18"Dia. LF 430 $45 $19,350
Storm Sewer Pipe,24"Dia. LF 400 $55 $22,000
D.I. Storm Sewer Pipe, 12"Dia. LF 90 $55 $4,950
Catch Basin Type 1 EA 16 $1,200 $19,200
Catch Basin Type 2 48 In. Diam. EA 6 $2,000 $12,000
Catch Basin Type 2 54 In. Diam. EA 4 $2,500 $10,000
Adjust Catch Basin EA 4 $250 $1,000
Control Structure EA 1 $5,000 $5,000
Flow Dispersal Structure EA 1 $5,000 $5,000
Precast Detention Vault EA 1 $65,000 $65,000
ESC Lead DAY 24 $150 $3,600
Inlet Protection EA 34 $100 $3,400
Silt Fence I LF 2850 $4 $11,400
Erosion/Water Pollution Control FA 1 $30,000 $30,000
Columnar Street Tree(2"Cal.) EA 96 $270 $25,920
Flowering Tree(2"Cal.) EA 26 $270 $7,020
Conifer Tree(8'-10'Ht.) EA 9 $125 $1,125
Groundcover(1 Gal. @18"o.c.) I EA 2825 $7 $19,775
Topsoil Type A CY 810 $35 $28,350
Sod SY 1480 $9 $13,320
Mulch CY 40 $35 $1,400
Irrigation SF 19680 $1 $19,680
12" Depth Root Barrier LF 1920 $7.50 $14,400
18" Depth Root Barrier LF 1920 $8 $15,360
Gravel Backfill for Dry Wells LS 1 $500 $500
Erosion Control Seed SF 25300 $0.10 $2,530
Seeding, Fertilizing, and Mulching AC 1.1 $3,500 $3,850
Cement Concrete Traffic Curb and Gutter LF 4350 $15 $65,250
Cement Conc.Sidewalk SY 1220 $25 $30,500
OPINION OF COST I j Perteet%Inc.
Strander Boulevard Extension Project -Stage 1
East of RR Tracks to Oakesdale Ave.SW
60% ESTIMATE
February 2005
•ITEM UNITS QUANTITY UNIT PRICE AMOUNT
Cement Conc. Sidewalk Ramp Type 1B EA 6 $1,000 $6,000
12' Cement Conc.Sidewalk Ramp EA 3 $2,000 $6,000
Illumination System LS 1 $42,000 $42,000
Traffic Signal System LS 1 $17,000 $17,000
Type 3 Barricade EA 8 $500 $4,000
Permanent Signing LS 1 $4,200 $4,200
Paint Line LF 3100 $0.20 $620
Plastic Wide Line LF 220 $3 $660
Plastic Stop Line LF 190 $5 $950
Plastic Crosswalk Line SF 1260 $5 $6,300
Plastic Traffic Arrow EA 4 $50 $200
Contingency(15%) $257,900
Total Schedule A $2,157,565
..CHEDULE B Waterx.x fi, , ,ti!,.1 :., fv' y,r,`a_;;1:& .�:•s,w '.''.. y. >;:`� ',;` ,r . 4x, -Ivi` '`
$ 7 1 000 .
Contingency(15%) r-v‘(‘/\ ` $0
Sub Total Schedule B 1).`D C)k) " $0
Sales Tax(@ 8.8%) ( F1 /6 Crc, Sr) $0
Total Schedule B $0
., e I as dt.a.srs». ja.f t fts, i .s 1 �'ra 4 a ., , ix•C i 4- ,i 4y
CHEDULE C<--$an�ta •Sewerr .<<��I�-.�4,��.���..�.�-:. :�� ����,��;,��;:f��#x-.��'�ti�. ._, . .�}�.. .,�r�,.� , � r nt,�.�,• ,
r
Contingency(15%) $0
(r141,0 cozy°
Sub Total Schedule C $0
Sales Tax(@ 8.8%) $0
Total Schedule C $0
_ . •c r -.s-:,. a.c '..r 4,5.. 2rJw ., . roA �y°a -Ii�,.rr•.[Y>�t:+
y`{nn ����� , :43ta�p��"���„' !, i y,,2.31' =:.5'i?ce _.J:'.. :h kY.; ,t:i.Y- n'4•• .. , ...
Co5)(1v..L-)t d,-N —
Contingency(15%) _ $0
Total Schedule D $0
Total Estimated Construction Cost I I I I
$2,157,565
,
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•
AGREEMENT
•
(REGARDING 27TH STREET PARCEL/STORMWATER DETENTION PARCEL)
This Agreement ("Agreement") is made and entered into as of April_, 2005, by and between
THE CITY OF RENTON, a municipal corporation (the "City"), and THE FEDERAL RESERVE BANK QF
SAN FRANCISCO("FRB").
RECITALS
A. Pursuant to the te[ms and conditions of that certain Real Property Purchase and Sale
Agreement (the `Purchase Agreement') dated November 5, 2004, between FRB, as buyer, and
.Longacres Park, Inc., as seller ("Seller"), FRB has agreed to purchase approximately 10.8 acres of real
property located within an area anticipated to be developed into an office park to be known as Longacres
Office Park(the "Subject Property'').
B. The Subject Property includes a parcel of real property of approximately 9.6 acres that will
" be legally established by a Binding Site Plan amendment on which FRB intends to construct a facility for its
Seattle-area branch administration,] cash processing and storage operations (the "FRB Parcel"), and an
additional parcel of approximately 1.2 acres identified as "Tract D" on that certain Boeing Longacres
Property Amended Binding Site Plan approved by the City of Renton on December 16, 2002 and recorded
in the land records of King County,''Washington in Volume 219 of plats at Pages 67 through 73, inclusive,
under Recording No.20040108000164 (the "Stormwater Detention Parcel"). The Subject Property is
located immediately south of a 90-foot wide right-of-way extending from Oaksdale to the Burlington
Northern railroad tracks that abuts the westerly boundary of the Boeing Longacres Office Park (the "27th
Street Parcel"). The 27th Street Marcel is intended to be improved as a five-lane extension of Southwest
27th Street and utilized as a public street and utility corridor. The 27th Street Parcel constitutes only a
segment (called the "Phase I Segment") of the planned extension of Southwest 27th Street, and such
extension extends to the west of Oaksdale. The 27th Street Parcel was previously dedicated by Seller to
the City pursuant to that certain Strander Agreement between the City and Seller dated December 4, 2002
(the "Strander Agreement"). The Subject Property, FRB Parcel, Stormwater Detention Parcel, and the
27th Street Parcel are each depicted on the conceptual site plan attached hereto as.Exhibit A, and are
each legally described on Exhibit B.
C. The parties have entered into this Agreement, among other reasons, to set forth their
respective obligations with respect to development, construction, ownership,-use and maintenance of(i)the
street, utilities, and related improvements to be located on and within the 27th Street Parcel (the "27th
Street Improvements," which includes the street, median, traffic signals, signs, and markings, curbs,
gutters, sidewalks, certain municipal utilities and easements for franchise utilities, drainage facilities,
landscaping, and all other improvements of any kind and nature within the 27th Street Parcel), and (ii) the
stormwater detention facilities to be located on the Stormwater Detention Parcel (the "Stormwater
Detention Facilities," which includes the culverts, pipes, excavation work, earth berms, lining,
AGREEMENT PAGE 1
#297409 18173-002.07 60Ho03!.00c
landscaping, signage, and all other improvements of any kind and nature within the Stormwater Detention
Parcel).
AGREEMENTS
In consideration of the mutual covenants and promises contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the City and FRB
agree as follows:
1. 27th Street Improvements.
1.1 Plans and Specifications. Attached hereto as Exhibit C are the plans and
specifications (in their current state) for the 27th Street Improvements. FRB hereby approves such plans
and specifications in their current state of detail. The City shall proceed with reasonable diligence to
complete such plans and specifications with all detail required for bidding and contracting for construction
of the 27th Street Improvements, and shall periodically provide FRB with updated plans and specifications
in accordance with the deadlines set forth in Exhibit D. Within 5 business days of receiving updated plans
for the 27th Street Improvements, FRB shall notify the City if FRB has any questions, comments, or
objections to such plans and specifications, in which case the parties shall meet and diligently attempt to
work out any differences. FRB's failure to notify the City of any objections to such plans or specifications
within such 5 business day period shall'constitute FRB's acceptance and approval of such plans. In the
process of completing such plans and specifications, the City shall also consult with FRB before making
any substantial changes to or deviations from the plans attached hereto as Exhibit C or any updated plans
previously provided to FRB. The City shall obtain FRB's final written approval of the 100% completed bid-
ready plans and specifications for the 27th Street Improvements before submitting such plans and
specifications to contractors for bidding and before entering into any contracts for construction of the 27th
Street Improvements.: FRB's approval of such final bid-ready plans and specifications shall not be
unreasonably withheld or delayed, and FRB's failure to object to such final plans within 5 business days
after it has received them shall be deemed to constitute approval of the plans. Any material changes in
excess of $30,000 to the plans and specifications, including but not limited to change orders or field
changes occurring during the construction process, shall be subject to FRB's prior written approval, but
such approval shall not be unreasonably withheld or delayed and shall be deemed given if FRB has not
responded in writing with objections within 5 business days after receiving notice of such proposed
changes.
1.2 Schedule. Subject to FRB's rights under Section 1.6, below, the City shall
commence and/or continue with design, permitting, environmental review, development, and construction •
of the 27th Street Improvements in a timely and workmanlike manner and shall diligently attempt to
proceed with and complete all such tasks in accordance with the milestones and deadlines included in the
schedule set forth on Exhibit D. Subject to any further delay that may be allowed as a result of a Force
Majeure Event, the City's failure to meet any milestone or deadline within the"grace period"shown on such
schedule shall constitute a default hereunder.
AGREEMENT PAGE 2
#297409 18173-002.07 6DHDO3LD0c
1.3 Franchise!Utilities. The City shall also grant to private utilities such franchise
rights to construct utilities over the 27th Street Parcel as are shown in the plans and specifications or are
needed for installationof the franchise utilities.
1.4 Costs. The City shall obtain necessary funding and bear all costs associated with
the design, development and construction of the 27th Street Improvements, except for (i) the costs of the
franchise utility extensions, and (ii) the portion of the costs associated with design and construction of the
water and sewer extensions for which FRB is required to pay or reimburse the City as described below..
1.4.1 Water and sewer utility extensions will be designed and constructed by
the City of Renton. All costs associated with designing and constructing the water line extension and sewer
line extension (referred to respectively herein as the "Water.Line Costs" and "Sewer Line Costs", as
further defined below) shall be allocated between FRB (with contributions from Seller, as described below)
and the City as follows:
• The first$278,815 of Water Line Costs shall be allocated to and borne by FRB
(with contributions from Seller, as described below), with the City to be solely
responsible for any additional Water Line Costs in excess of such cap; and
• The first$90,000 of Sewer Line Costs shall be allocated to and borne by FRB
(with contributions from Seller, as described below), with the City to be solely
responsible for any additional Sewer Line Costs in excess of such cap.
1.4.2 The City shall invoice FRB on a periodic (but not more frequently than
monthly) basis for any Water Line; Costs or Sewer Line Costs for which it is seeking reimbursement or
payment from FRB under this Section and, at the request of FRB, will provide FRB with contractor invoices,
progress reports, or other documentation evidencing such costs. FRB agrees to pay or reimburse the City
for such invoices within sixty (60) days after receipt thereof. Any such payments that are not paid when
due shall accrue interest at a rate equal to 10% per annum. Although Seller is not a party and is not
contractually obligated under this Agreement, the City acknowledges and agrees that FRB and Seller have
' entered into a side agreement pursuant to which Seller has agreed to pay or reimburse the City for a
portion of the Water Line Costs and Sewer Line Costs for which FRB is responsible under this Agreement.
• 1.4.3 Franchise utilities (i.e., electricity, natural gas, cable television, data/voice
communications, etc.) will be constructed at the expense of the FRB and/or the Seller., The City is in no
way responsible for the design or construction of franchise utilities.
•
1.4.4 In'the event that any portion of the 27th Street Improvements is developed
or constructed by FRB pursuant to Section 1.6 below or as otherwise agreed between FRB and the City,
the City shall reimburse FRB for ;any costs incurred by FRB in connection therewith' (including but not
limited to customary and reasonable construction management fees and a customary and reasonable
allowance for general contractor profit and overhead). Such reimbursement shall be made on an ongoing,
periodic basis in a schedule to be mutually established by the City and FRB not to exceed three years. Any
AGREEMENT . .PAGE 3
#297409 18173-002.07 6DHD031.Doc
amounts not reimbursed by the City when due pursuant to such schedule (and in any event not later than
three (3) years after completion of such improvements) shall thereafter accrue interest at a rate equal to
10% per annum.
1.4.5 For purposes of this Section 1.4, "Water Line Costs" shall mean any
reasonable, out-of-pocket costs of planning, designing, permitting, and constructing the water line
extension, including but not limited to the following reasonable out-of-pocket costs: design fees,
architectural fees,engineering fees, consultants'fees, contractors'and subcontractors'fees, attorneys'fees
and costs for permit processing, construction management and supervision fees, document preparation
costs, plan check or administrative review fees, permit fees, survey costs, bond premiums and costs, bid
costs, construction costs, industrial, property, liability and other insurance costs, surety and indemnity
costs, materials and supplies costs, equipment costs, labor costs, testing and monitoring costs, inspection
fees, maintenance and repair costs incurred prior to completion of the water line extension, and all other
costs of any kind whatsoever reasonably necessary for construction of the water line extension.
1.4.6 For purposes of this Section 1.4, "Sewer Line Costs" shall mean any
reasonable, out-of-pocket costs of planning, designing, permitting, and.constructing the Sewer line
extension, including but not limited to the following reasonable out-of-pocket costs: design fees,
architectural fees,engineering fees, consultants'fees, contractors'and subcontractors'fees, attorneys'fees
and costs for permit processing, construction management and supervision fees, document preparation
costs, plan check or administrative review fees, permit fees, survey costs, bond premiums and costs, bid
costs, construction costs, industrial, property, liability and other insurance costs, surety and indemnity
costs, materials and supplies costs, equipment costs, labor costs, testing and monitoring costs, inspection
fees, maintenance and repair costs incurred prior to completion of the sewer line extension, and all other
costs of any kind whatsoever reasonably necessary for construction of the sewer line extension.
1.5 Construction Coordination to Ensure Access to Subject Property. Priorto
commencement and after completion of the 27th Street Improvements, FRB shall have free and unlimited
access to the 27th Street Parcel and any existing improvements located thereon for purposes of accessing
the Subject Property, developing the Subject Property, and constructing improvements thereon. Following
commencement of construction of the 27th Street Improvements, FRB and the City shall coordinate their
respective construction activities and work cooperatively so as to enable and preserve for FRB reasonable
vehicular access to the Subject Property, and shall schedule the construction of the 27th Street
Improvements so as to facilitate such access, so long as FRB's use of the 27th Street Parcel does not
unreasonably interfere with completion of the 27th Street Improvements. The FRB shall be responsible for
any and all costs associated with repairing any damage to the 27th Street improvements during or after its
construction, to the extent such damage is caused by FRB or its contractors while using the parcel to
access the FRB site during the period of construction of FRB facilities.
1.6 FRB Right to Complete Upon City Default. If design, development or
construction of the 27th Street Improvements at any time falls behind the schedule of milestones and
deadlines shown in Exhibit D by more than the applicable "grace period" shown therein (subject to
AGREEMENT PAGE 4
#297409 18173-002.07 6DH003!.00c
extension upon the occurrence of a"Force Majeure Event", as defined below), FRB may give written notice
of such tardiness to the City, and upon receipt of such notice, the City-shall have an additional "cure period"
as shown in Exhibit D to accelerate the design, development, and construction of the 27th Street
Improvements so that no unsatisfied milestone or deadline on such schedule remains behind schedule by a
margin of time that is morethan the applicable grace period. However, if, after receipt of such notice and
expiration of such additional cure period, the design, development, or construction of any unsatisfied item
on the schedule for the 27th Street Improvements remains behind schedule by a margin longer than the
applicable grace period, FRB may, by written notice to the City, state that the City is in default and elect to
complete all or a portion of the 27th Street Improvements, or may complete temporary improvements on
the 27th Street Parcel for purposes',of providing access and utilities to the Subject Property in accordance
with Section 1.3. With respect to any such temporary improvements that FRB elects to complete upon City
default, the City shall be obligated under Section 1.4.4 to reimburse FRB for the cost of such improvements
only to the extent that such temporary improvements are incorporated into and become part of the 27th
Street Improvements. In addition,!in the event that incorporating such temporary improvements into the
27th Street Improvements causes the City to incur additional expenses (other than such reimbursement
obligation), the amount of such expenses shall be deducted from the City's reimbursement obligation with
respect to such temporary improvements.Any entry of FRB onto the 27th Street Parcel for completion of all
or a portion of the 27th Street Improvements or for construction of temporary improvements shall be subject
to the following terms and conditions:
1.6.1 Easement. To the extent a temporary easement is necessary, the City
hereby grants to FRB a temporary easement to FRB on, over and under the 27th Street Parcel for the
purposes ofenablingFRB to access the Subject Property by vehicle over the 27th Street Parcel, and for
the purposes of constructing (i)such portion of the 27th Street Improvements (including but not limited to,
the road, drainage, and utilities).as FRB may elect to construct or (ii)any other temporary improvements
over the 27th Street Parcel to enable vehicular access after the City has been notified that it is in default
pursuant to this Section 1.6. This subsection 1.6.1 is a presently effective grant of such easement, but
upon FRB's demand after the City;has failed to cure a default under this Section 1.6 within the applicable
cure period, the City shall execute; have notarized, and deliver to FRB for recording such Memorandum of
Easement as FRB may reasonably require, so long as such. Memorandum of Easement is consistent with
the terms hereof. Such temporary easement shall terminate when the..27th Street Improvements have
been completed and the road and utilities thereon are available for public use by FRB, as owner of the
Subject Property.
1.6.2 FRB Discretion as to Completion. If FRB elects to exercise its rights to
complete particular 27th .Street Improvements, it shall first consult with the City as to its plans, and the
parties shall attempt• to reach agreement on FRB's construction activities and the arrangements for
payment or reimbursement therefor by the City. If the 27th Street Improvements are not yet commenced,
and no contract has been signed,for the construction of them, and FRB does not want to assume the •
responsibility for completing all of the 27th Street Improvements, FRB may construct whatever portion of
the 27th Street Improvements it deems reasonable, or may construct or install such temporary facilities,
including but not limited to a temporary two-lane gravel or asphalt road or temporary utilities, to provide
AGREEMENT PAGE 5
#297409 18173-002.07 6DHo031.00c
temporary vehicular access and utilities to the FRB property. FRB may also at any time elect not to
construct any improvements on the 27th Street Parcel if the City is not making payment or reimbursement
when due as agreed to between the parties.
1.6.3 Assignment of Contracts. Should the City fall behind the schedule of
milestones and deadlines shown in Exhibit D by more than the applicable "grace period" shown therein,
FRB may elect to engage other contractors to commence or complete such work as is necessary to provide
access and City utilities to the FRB. The City's duty to reimburse the FRB shall be as detailed in Section
1.4 herein. The FRB shall be required to provide the City with copies of all contractor, subcontractor,
consultant,or other invoices for which FRB is seeking reimbursement.
1.6.4 Permits. The City shall cooperate to the fullest extent permitted by law in
processing or joining in applications for any permits or permit modifications that may be required but have
not yet been obtained, or for any permits needed for such temporary improvements as FRB may elect to
construct on the 27th Street Parcel. Furthermore, the City shall process any such permit applications on
an expedited basis to the fullest extent allowed by law. The City shall not withhold, delay, or intentionally
and unreasonably condition any such permits for 27th Street Improvements or temporary improvements on
the 27th Street Parcel merely to avoid its payment or reimbursement obligations hereunder, nor shall it
withhold, delay, or intentionally and unreasonably condition any permit processes for the improvements to
be constructed on the Subject Property merely to avoid or delay its payment or reimbursement obligations
hereunder. However, the City shall be entitled to exercise its municipal functions in a lawful and
reasonable manner, consistent with its normal practices and all applicable laws, codes, and ordinances.
1.6.5 Intervention Permitted Only Upon City Default. Notwithstanding the
foregoing, FRB acknowledges and agrees that it shall have no right to intervene in the City's design,
permitting, environmental review, development and construction of the 27th Street Improvements, and shall
have no right to construct the 27th Street Improvements or any temporary improvements on the 27th Street
Parcel at the City's expense so long as the City proceeds with the design, permitting, environmental review,
development, and construction of the 27th Street Improvements in accordance with the schedule attached
as Schedule D, or within the applicable grace periods provided for in such schedule, in each instance
subject to delays permitted by Force Majeure Events.
1.7 Force Majeure. To the extent any delay in completion of the 27th Street
Improvements is caused by a Force Majeure Event, the 27th Street Milestone Deadlines shall be extended
by the period of delay that reasonably and unavoidably occurs as a direct result of such Force Majeure
Event. For purposes of this Agreement, "Force Majeure Event" shall mean any event beyond the
reasonable control of the parties, including, without limitation: (a) acts of God including fire, storm;flood, •
earthquake, or other casualty, (b)war, civil commotion, or enemy or hostile government action that impacts
a substantial portion of the construction activities in King County; Washington, (c) unavoidable delays in
federal or agency processes or judicial orders, (d) strike or work stoppage, (e) unavailability of materials
necessary to complete.-portions of the work, (f) discovery of archeological sites which require work
stoppage or substantial reordering of work, causing substantial delay,or(g)discovery of contaminated soils
AGREEMENT PAGE 6
#297409 18173-002.07 6DHDO3LDoc
•
or material requiring clean up; provided, however, that precipitation or other adverse weather must be
extraordinary, deviant from seasonal, periodic, or daily norms or must cause extraordinary difficulties on the
work site before it will be recognized as a Force Majeure event. Notwithstanding any other provision of this
Agreement, FRB's rights under Sections 1.6, 3.7, or elsewhere in this Agreement to intervene and
complete some or all.of the 27th Street Improvements, temporary improvements in lieu thereof, or the
Stormwater Detention Facility shall]not be delayed by more than 90 days due to a Force Majeure Event if
such Force Majeure Event would not affect FRB"(e.g., if the Force Majeure Event was a City strike that
prevented the City but not FRB from completing such projects), even though such Force Majeure Event
may excuse performance and cause the City not to be in default under this Agreement.
2. Acquisition of Stormwater Detention Parcel; Allocation of Purchase Price. Under the
terms of the Purchase Agreement', thepurchase price for all of the Subject Property is $16.212963 per
square foot of gross area within the Subject Property(estimated to be$7,627,356, assuming approximately
10.8 acres or 470,448 square feet). Such total purchase price shall be allocated pro rata between
Stormwater Detention Parcel and the FRB Parcel in accordance with their relative square footages, thereby
establishing the "Stormwater Detention Parcel Purchase Price" (estimated to be $847,484, assuming
that the Stormwater Detention Parcel is 1.2 acres or 52,272 square feet, or approximately 11.11% of the
total area of the Subject Property). TheStormwater Detention Parcel Purchase Price shall then be
allocated between the City and FRB in accordance with their respective "Stormwater Percentages'; as
such term is defined in Section 3.2. The City shall reimburse FRB an amount equal to the City's
Stormwater Percentage of the Stormwater Detention Parcel Purchase Price upon substantial completion of
construction of the Stormwater Detention Facility, and in any event not later than March 1, 2007.
3. Construction, Ownership, Operation and Maintenance of Stormwater Detention Facilities.
3.1 Overview of Steps of Transaction.
3.1.1 The parties intend that the Stormwater Parcel will be initially acquired and
owned by FRB, but will be dedicated to the City within 30 days after the closing of the sale of the same to
FRB ("Closing").
3.1.2 Concurrently with FRB's acquisition of the Stormwater Parcel, FRB and the
City of Renton shall execute an"Agreement for Easement and Covenants Regarding Stormwater Detention
Facilities" in the form attached hereto as Exhibit H (the "Stormwater Detention Facilities Easement).
Such instrument shall grant a stormwater drainage, detention, and maintenance easement to the City for
the benefit of the 27th Street Parcel and to FRB for the benefit of the FRB,Parcel, and shall memorialize the
perpetual covenants that shall 'run with ownership of both parcels relating to perpetual use of the
Stormwater Parcel solely for stormwater detention and landscaping and maintenance of the Stormwater
Parcel.
3.1.3. FRB will design the Stormwater Detention Facilities in the Stormwater
Parcel in accordance with plans and specifications approved,by the City in writing. The City shall construct
AGREEMENT PAGE7
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the Stormwater Detention Facility as part of the 27th Street Improvements. The costs of all such design,
permitting, environmental review, development, and construction, as well as any ongoing maintenance,
shall be allocated between and shared by the City and FRB as described herein.
3.1.4 FRB shall dedicate and convey ownership of the Stormwater Parcel to the
City within 30 days after Closing, but the Stormwater Detention Facilities Easement that benefits the City
(as owner of the 27th Street Parcel)and FRB (as owner of the FRB Parcel), shall remain in effect.
3.1.5 Even after the City acquires the Stormwater Parcel by dedication,the costs
of ongoing maintenance of the Stormwater Parcel shall continue to be allocated between and shared by the
City and FRB as described herein and in the Stormwater Detention Facilities Easement,. and this
Agreement shall continue in existence perpetually as a covenant running with ownership of the FRB Parcel
and the 27th Street Parcel, or until the owners of such parcels mutually agree in writing to modify or
terminate the Stormwater Detention Facilities Easement any applicable provisions of this Agreement.
3.2 Allocation of Detention Capacity; Stormwater Percentages of the Parties.
The total gross detention capacity of the Stormwater Detention Facilities to be constructed in the
Stormwater Parcel is estimated to be 212,865 cubic feet. Of this total,the City and FRB hereby agree that
this total capacity shall be allocated between the City, for the benefit of the 27th Street Parcel, and FRB, for
the benefit of the FRB Parcel, in the following manner, resulting in the following "Stormwater
Percentages"for purposes of allocating and sharing certain costs under this Agreement:
Party Detention Capacity(cubic feet) Stormwater Percentage
•
FRB 114,947.1 cubic feet 55%
City of Renton 97,917.9 cubic feet 45%
Totals: 212,865 cubic feet 100%
Each of FRB, as owner of the FRB Parcel, and the City, as owner of the 27th Street Parcel, agrees to
design, permit, and construct stormwater drainage and/or detention facilities so that the amount of
stormwater detention that it is permitted to utilize within the Stormwater Detention Facilities (based on
calculations made under the Washington Department of Ecology Stormwater Management Manual for
Western Washington, August 2001 edition) will not exceed its share of such detention capacity as shown
above. If the Stormwater Detention Facilities shall ever become overloaded or shall fail because FRB or
the City has violated this provision, then the party who is guilty of such violation shall be solely obligated to
repair and to pay for the cost of repair of any damage to the Stormwater Detention Facilities or to the parcel
owned by the other party that was caused by such violation, and shall promptly commence the design,
permitting, and construction of such additional stormwater drainage or detention facilities on its respective
parcel as are required for such party not to be in violation of this provision governing the allocation of the
total capacity of the Stormwater Detention Facilities.
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3.3. Plans and Specifications. Attached hereto as Exhibit E are the,plans and
specifications (in their current state) for the Stormwater Detention Facilities, which include approximately
50% of the total estimated required engineering and construction detail. The City hereby approves such
plans and specifications in their current state of detail. FRB shall proceed with reasonable diligence to
complete such plans and specifications with all detail required for bidding and contracting for construction
of the Stormwater Detention Facilities and shall periodically provide the City with updated plans and
specifications in accordance with the deadlines set forth in Exhibit F. Within 5 business days of receiving
updated plans for the Stormwater Detention Facilities, the City shall notify FRB if the City has any
questions, comments, or objections to such plans and specifications, in which case the parties shall meet
and diligently attempt to work out any differences. The final plans for the Stormwater Facility will be turned
over to the City and will be incorporated into the 27th Street Improvement Plans. In the process of
completing such plans and specifications, FRB shall also consult with the City before making any
substantial changes to or deviations from the plans attached hereto as Exhibit E or any updated plans
previously provided to the City. FRB shall obtain the City's final written approval of the 100% completed
bid-ready plans and specifications for the Stormwater Detention Facilities before the plans will be
incorporated into the 27th Street Improvement Plans. The City's approval of such final bid-ready plans and
specifications shall not be unreasonably withheld or delayed. After the plans have been incorporated into
the 27th Street Improvements Plans, any material changes to the plans and specifications, including but not
limited to change orders or field changes occurring during the construction process, shall be subject to the
FRB's prior written approval, but such approval shall not be unreasonably withheld and shall be deemed
given if the FRB has not responded in writing with objections within 5 business days after receiving notice
of such proposed changes. All time periods for review in this Section, apply to both the FRB and to the
Public Works Department in its engineering capacity and as investor in the facility, but do not apply to the
Development Services Division in its capacity of providing regulatory review and approval. '
3.4 Schedule.; Subject. to the City's rights under Section 3.8, below, FRB shall
commence and/or continue with design of the Stormwater Detention Facilities in a timely and workmanlike
manner and shall diligently attempt to proceed with and complete all such tasks in accordance with the
milestones and deadlines included,in the schedule set forth on Exhibit F. Likewise, subject to the FRB's
rights under Section 3.8 below, the City shall commence and/or continue with environmental review and
construction of the StormwaterDetention Facilities in a timely and workmanlike manner and shall diligently
attempt to proceed with and complete all such tasks in accordance with the milestones and deadlines
included in the schedule set forth in Exhibit D. Subject to any further delay that may be allowed as a result
of a Force Majeure Event, the City's failure to meet any milestone or deadline within the "grace period"
shown on such schedule shall constitute a default hereunder.
3.5 Allocation and Payment of Shared Costs. All "Shared Costs" associated with
the design, permitting, environmental review, development, and construction of the Stormwater Detention
Facilities shall be allocated between the City and FRB 'pro rata in accordance with their respective
Stormwater Percentages. For purposes of this Agreement, the term "Shared Costs" shall mean all
reasonable, out-of-pocket costs of planning, designing, permitting, andconstructing the Stormwater
Detention Facilities (regardless of whether such costs were incurred before or after the date of this
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Agreement), including but not limited to the following reasonable costs: design fees, architectural fees,
engineering fees, consultants' fees, contractors' and subcontractors' fees, attorneys' fees and costs for
permit processing, construction management and supervision fees, document preparation costs, plan
check or administrative review fees, permit fees, survey costs, bond premiums and costs, bid costs,
construction costs, industrial, property, liability and other insurance costs, surety and indemnity costs,
materials and supplies costs, equipment costs, labor costs, testing and monitoring costs, inspection fees,
maintenance and repair costs, and all other costs of any kind whatsoever arising out of or reasonably
necessary for construction of the Stormwater Detention Facilities. FRB shall provide the City with a
breakdown of the estimated costs of design. The City shall provide the FRB with a breakdown of the
estimated costs of environmental review, permitting development and construction. The City, throughout
construction, and until final closeout and payment, will maintain separate books accounting for and
recording costs to be reimbursed. Each party agrees to pay its Stormwater Percentage of Shared Costs,
or, if its Stormwater Percentage of such Shared Costs is advanced by the other party (which is anticipated
to be the case as FRB advances funds to design the Stormwater Detention Facilities), to reimburse the
other party for such advanced portion within 30 days after final completion of the Stormwater Detention
Facilities. , Any amounts not so reimbursed within 30 days of a party's receipt of a demand for
reimbursement with supporting invoices shall accrue interest at a rate equal to 10% per annum.
3.6 Construction Coordination. The City and the FRB shall create a Construction
Project Coordination Team and an Executive Team. Whenever conflicts arise on the construction of
Southwest 27th Street, the access to the FRB site, or the Detention Facility, the Construction Project
Coordination Team shall meet and attempt to resolve those problems. The Construction Project
Coordination Team shall consist of technical representatives from the City and the FRB with the technical
expertise in the particular area at issue. There shall also be created a Construction Executive Team which
shall resolve all policy or discretionary issues not resolved by the Construction Project Coordination Team.
3.7 FRB Right to Complete Stormwater Detention Facility Upon City Default. If
construction of the Stormwater Detention Facilities at any time falls behind the schedule of milestones and
deadlines shown in Exhibit D by more than the applicable "grace period" shown therein (subject to
extension upon the occurrence of a "Force Majeure Event", as defined below), the FRB may give written
notice of such tardiness to the City, and upon receipt of such notice, the City shall have an additional"cure
period" as shown in Exhibit D to accelerate the construction of the Stormwater Detention Facilities so that
no unsatisfied milestone or deadline on such schedule remains behind schedule by a margin of time that is
more than the applicable grace period. However, if, after receipt of such notice and expiration of such
additional cure period, the construction of any unsatisfied item on the schedule for the Stormwater
Detention Facilities remains behind schedule by a margin longer than the applicable grace period, the FRB
may, by written notice to the City, elect to complete all or a portion of the Stormwater Detention Facilities, or
may complete temporary improvements on the Stormwater Parcel for purposes of providing adequate
stormwater detention for the FRB facility, with all costs advanced by the FRB constituting Shared Costs that
are to be allocated between and shared by the City. and FRB in accordance with their Stormwater
Percentages. Delay by the FRB in providing the final design plans and specifications for the Facility to the
City shall not be considered in any default and shall constitute an extension of all timelines and grace
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periods under Exhibit D. Any entry of the FRB onto the Stormwater Parcel for completion of all or a portion
of the Stormwater Detention Facilities or for construction oftemporary improvements shall be subject to the
following terms and conditions:
3.7.1 FRB;Discretion as to Completion of the Stormwater Detention Facility. The
FRB shall consult with the City as to its plans for the Stormwater Detention Facilities and the parties shall
attempt to reach agreement on the City's construction activities and the arrangements for payment or
reimbursement therefor by the FRB. However, lacking such agreement, the FRB shall have discretion to
construct such improvements as the FRB believes are necessary or appropriate for the FRB to establish
adequate stormwater detention facilities to accommodate the needs and requirements of the FRB facility
within a time frame that will avoid any delay in the FRB's construction of the;FRB facility. If the Stormwater
Detention Facilities are substantially commenced and already partially complete and the FRB believes that
it will achieve efficiencies and cost savings by completing the Stormwater Detention Facilities in complete
or substantial accordance with the plans and specifications, the FRB may, in its sole discretion, elect to
proceed with a full completion of all,of the Stormwater Detention facilities according to the approved plans
and specifications, and the City shall be obligated to pay its Stormwater Percentage of all costs thereof.
Conversely, if the Stormwater Detention'Facilities are not yet commenced or are in very early stages of
grading and construction and the FRB does not want to assume the responsibility for completing all of the
Stormwater Detention Facilities, th'e FRB may construct whatever portion of the Stormwater Detention
Facilities it deems reasonable, or may construct or install such temporary facilities, including but not limited
to a temporary pond or temporary filtration or detention barriers. In that event, the City shall pay its
Stormwater Percentage of the costs of any and all improvements undertaken by the FRB that will be
incorporated into the permanent Stormwater Detention Facilities, but the City shall not be obligated to pay
the costs of any temporary improvements that will need to be removed and will not be incorporated into the •
permanent Stormwater Detention Facilities. The FRB may also at any time elect not to construct any
improvements on the Stormwater Parcel if the City is not making payment or reimbursement when due or is
declining to acknowledge its obligation to make payment or reimbursement therefor.
3.7.2 Assumption of Construction of the Stormwater Detention Facility. Should
the City- fall behind the schedule;of milestones and deadlines shown in Exhibit D by more than the
applicable "grace period" shown therein, the FRB may elect to engage other contractors to commence or
complete such work as isnecessary to provide storm water treatment and detention for the FRB facility.
The City's duty to reimburse the FRB shall be as detailed in Section 1.4 herein. The FRB shall be required
to provide the City with copies of all contractor, subcontractor, consultant, or other invoices for which FRB
is seeking reimbursement. )
,3.7.3 Permits. The City shall cooperate to the fullest extent permitted by law in
processing or joining in applications for any permits or permit modifications that may but have
not yet been obtained, or for any permits needed for such temporary improvements as the;FRB may elect
to construct on the Stormwater Parcel.
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3.7.4 Intervention Permitted Only Upon City Default. Notwithstanding the
foregoing, the FRB acknowledges and agrees that it shall have no right to intervene in the City's permitting,
environmental review, development and construction of the Stormwater Detention Facilities, and shall have
no right construct the Stormwater Detention Facilities or any temporary improvements on the Stormwater
Parcel at the City's expense so long as the City proceeds with the permitting, environmental review,
development, and construction of the Stormwater Detention Facilities in accordance with the schedule
attached as Schedule D, or within the applicable grace periods provided for in such schedule, in each
instance subject to delays permitted by Force Majeure Events.
3.8 Final Completion; Dedication to City. Upon substantial completion of the
Stormwater Detention Facilities, the City shall provide the FRB with written notice of such completion.
Upon receipt of such notice, the FRB shall have 30 days to inspect the Stormwater Detention Facilities in
the presence of representatives of the City, the City's stormwater engineer, and the City's general
contractor, to verify_that such facilities have been constructed in accordance with the final bid-ready plans
and specifications that were previously provided to the City.by FRB, subject to such further change orders
and field changes that the FRB has previously approved. At any time during such 30 day period, the FRB
may provide the City with a list of punch'-list items that need to be completed or other corrections that need
to be made in order for the Stormwater Detention Facilities to be in full accordance with the plans and
specifications. If the FRB does not provide the City with punch list items or notify the City of other
corrections that need to be made within such 30-day period, the Stormwater Detention Facilities will be
deemed finally complete. The Stormwater Detention Facilities will also be deemed finally complete upon
the City's completion of any required punch list items or other corrections. FRB shall dedicate and transfer
the Stormwater Parcel to the City within 30 days after Closing of FRB's initial acquisition of the Stormwater
Parcel, and the City agrees that it shall accept such dedication. Each party agrees that it shall execute
such documents and take such other actions as reasonably necessary to complete such dedication. Such
dedication shall require that the City perpetually use the Stormwater Parcel solely for purposes of
stormwater detention and solely for the benefit of the 27th Street Parcel and the FRB Parcel, as described
herein and in the Stormwater Detention Facilities Easement. The City agrees that it shall continue to own
the 27th Street Parcel solely for stormwater detention purposes and shall not voluntarily convey ownership
4 thereof to any other party unless otherwise consented to by the owner of the FRB Parcel. Along with
dedication to the City, the FRB shall assign to.the City any and all warranties, rights under contracts, or
other documents related to the design of the Stormwater Detention Facilities and necessary to put the City
in the FRB's position with respect to enforcing warranties, rights to compel repairs, and rights to compel
replacement of defective work.
3.9 Ongoing Operation and Maintenance;Allocation of Costs. Following
completion of the Stormwater Detention Facilities, the City shall be responsible for operating, maintaining,
and repairing the Stormwater Detention Facilities in accordance with the Stormwater Detention Facilities
Maintenance Schedule attached hereto as Exhibit G(the "Stormwater Detention Facilities Maintenance
Schedule"). The City shall perform such maintenance tasks as are specifically identified as "Basic
Maintenance Items"or"Enhanced Maintenance Items"on Exhibit G and shall perform such other
AGREEMENT PAGE 12
#297409 18173-002.07 601003LD0c
repairs, replacements, and maintenance as are required to continuously preserve the Stormwater
Detention Facilities and the Easement Area in a neat,clean, and safe condition, in compliance with all
statutes, ordinances, and other laws, and in conformity with all permit conditions, restrictions, and other
requirements established with respect to the Easement Area under the binding site plan under which the
Easement Area was created or is governed, and under any permit conditions associated with the permits
and approvals given with respect toj the 27th Street Parcel and the FRB Parcel. If at any time the City fails
to perform such maintenance, FRB may elect, by providing written notice to the City, to perform such
maintenance. All costs of the of the"Basic Maintenance Items"shall be borne by the City, and all.costs of
the"Enhanced Maintenance Items"set forth in the Stormwater Detention Facilities Maintenance Schedule
shall be borne by the FRB. If the City incorporates a special aesthetic gateway feature,the City shall be
responsible for the extra"Enhanced Maintenance"costs due to that feature. Each party agrees to pay its
share of the costs of the Basic and Enhanced Maintenance Items, and if its share is advanced by the other
party, to reimburse the other party for such share,within 30 days after receipt of such party's periodic(but
not more frequently than monthly)invoices or demands therefor. Any amounts not so reimbursed within 30
days of a party's receipt of a demand for reimbursement with supporting invoices shall accrue interest at a
rate equal to 10% per annum. No major capital improvements or replacements to the Stormwater
Detention Facilities or changes to the Stormwater Detention Facilities Maintenance Schedule shall be made
without the prior written approval of;both FRB and the City.
3.10 Covenants Running with the Land. The Stormwater Detention Facilities
Easement and the provisions of this Section 3 imposing ongoing obligation upon the parties which are
intended to continue perpetually and indefinitely (including but not limited to the obligations under
Section 3.9 relating to dedication and ownership and the obligations under Section 3.10 requiring the City
to perform all tasks identified on the Stormwater Detention Facilities Maintenance Schedule and requiring
the City and FRB in Section 3.10 to pay their respective Stormwater Percentages of the costs. of the
Enhanced Maintenance Items shown on such schedule) shall be perpetual, shall be deemed covenants
running with the land, and shall inure to the benefit of, and shall be binding upon, FRB, as owner of the
FRB.Parcel, and the City, as owner of the 27th Street Parcel, and their respective successors, grantees,
heirs and assigns. Public notice of such perpetual covenants shall be included as part of the Stormwater
I Detention Facilities Easement Agreement.
4. City and Franchise Utilities.
4.1 City Utilities: This Agreement addresses stormwater collection, retention,
treatment and discharge, and water and sewer utilities. The City will design and construct the public
portion of the water andsanitary sewer utilities, meaning the portions that lie within the proposed 27th Street
Parcel and proposed City easements.
4.1.1. The public sanitary sewer will be a 12-inch line from the existing King
County sewer interceptor and will extend south across Southwest 27th Street and into the FRB Parcel with
a 12-inch stub provided tothe westerly property at the end of the joint-use driveway. The FRB will
reimburse the City for the cost of this facility, subject to the cap set forth in Section 1.4.1.
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• 4.1.2. The public water line will be a 12-inch water line and appurtenances within
Southwest 27th Street, along with 2- 12-inch water stubs to the FRB Parcel. The maximum available fire
flow from this 12-inch water line is 2,500 gallons per minute, at 20 psi residual pressure. FRB is
responsible for the design and installation of an interior looped water line around the FRB Parcel within an
easement on the FRB Parcel. If the required fire flow for the FRB facility as determined by the Renton Fire
Department exceeds 2,800 gallons per minute, a second parallel 12-inch water line within Southwest 27th
Street will be required and shall be constructed by the City. The FRB will reimburse the City for the cost of
the first 12-inch public water line in SW 27th Street, subject to the cap set forth in Section 1.4.1. FRB is
responsible for all costs associated with the design and construction of the second 12-inch parallel line in
Southwest 27th Street if this second line is required to meet the fire flow requirements for FRB's facility.
4.1.3. The FRB shall design, construct and pay full cost for the private water,
sewer, and stormwater lines needed for the FRB facility. These private lines include stormwater lines and
detention and water quality facilities other than the Stormwater Detention Parcel, the sidesewer(s) to the
FRB facility, and the water services(s)and appurtenances downstream of the water meter(s).
4.2 Franchise Utilities. The FRB,facility will require franchise utilities which may
include electricity, natural gas, cable television, data/voice communications, etc. The FRB shall be
responsible for contacting the franchise utility providers and paying for and obtaining the design for such
utilities. The FRB shall provide franchise utility construction plans to the City, and coordinate the timing of
installation of such franchise utilities with.the City, so that the City may incorporate the design and
construction of the franchise utilities into its design and construction of SW 271h. To the extent that the
franchise utilities cross under or are included within the construction of SW 27th, the FRB shall coordinate
the installation of the franchise utilities so that the installation of such franchise utilities shall not interfere
with the construction of SW 27th. In the event that the franchise utility construction plans have not been
furnished by FRB to the City in a time frame that allows them to be incorporated into the contract
documents for the construction of Southwest 27th Street, then the franchise utilities construction will not be
part of the Southwest 27th Street project. In this case thefranchise utilities shall be designed in such a way
as to minimize the need to excavate portions of Southwest 27th Street that were previously installed.
5. Effectiveness. This Agreement shall take effect and shall become binding on the parties
upon mutual execution hereof. However, if, for any reason FRB fails to acquire the Subject Property
(including both the FRB Parcel and the Stormwater Parcel) on or before December 31, 2005, then this
Agreement shall immediately become null and void. In addition, if, prior to acquisition of the Subject
Property, FRB determines that purchase of the Subject Property is not feasible for its intended uses, or if
FRB is at any time adjudged not to have rights to purchase the Subject Property, then FRB may elect, by
written notice to the City, to terminate and cancel this Agreement. Upon any termination of this Agreement,
neither party shall have any further obligation to the other party hereunder; provided, however, that to the
extent that FRB has incurred costs in designing the Stormwater Detention Facilities that have not been
reimbursed by the City and the City desires to use any portion of the plans and specifications for such
facilities, FRB shall have a right to recover an equitable portion of such unreimbursed costs as a condition
of allowing the City to use such plans and specifications. To the extent that the City has incurred Water
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• . • I '
Line Costs or Sewer Line Costs that have not been reimbursed by FRB pursuant to this agreement, upon
FRB's withdrawal from this Agreement,. FRB shall reimburse the City for such costs, up to the applicable
caps. This Section shall survive this Effectiveness Section and shall be effective despite the rest of this
Agreement becoming null and voidl
6 Continued Effectiveness of Strander Agreement. The Strander Agreement between
the City and Seller shall remain in full force and effect, notwithstanding execution and delivery of this
Agreement. Nothing contained herein shall affect or modify in any way the City and Seller's rights and
obligations under the Strander Agreement.
7. Miscellaneous
7.1 ,Notices. iAll notices, demands, requests, consents and approvals which may, or
are required to, be given by any party to any other party hereunder shall be in writing and shall be deemed
to have been duly given if: (i)delivered personally, (ii)sent by a nationally recognized overnight delivery
service or local messenger service, (iii)electronically transmitted via facsimile transmission with fax
machine printout of confirmation'of receipt prior to 4:30 p.m. on a business day and a hard copy
ovemighted the next business day thereafter, or (iv)if mailed or deposited in the United States mail and
sent by registered or certified mail return receipt requested, postage prepaid to the following addresses or
to such other addresses as either'party hereto may from time to time designate in writing and deliver in a
like manner:
To FRB: Federal Reserve Bank of San Francisco
101 Market Street
San Francisco, CA 94105
Attn: John F. Moore
First Vice President, Chief Operating Officer
Phone No. (415) 974-2071
Fax No. (415)974-2113
with a copy to: Federal Reserve Bank of San Francisco
101 Market Street, Mail Stop 730
P.O. Box 7702
San Francisco, CA 94105-1530
Attn: Shirley Ng Thompson •
Associate General Counsel, Legal Division
Phone No. (415) 974-2820 . .
Fax No. (415) 974-2800
and a copy to: Federal Reserve Bank of San Francisco
101 Market Street,Mail Stop 730
P.O. Box 7702
AGREEMENT PAGE 15
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•
San Francisco, CA 94105-1530
Attn: Randy Balducci
Director, District Facilities Management
Phone No. (415)974-2753
Fax No. (415)974-2400
and a copy to: Hillis Clark Martin &Peterson
500 Galland Building
1221 Second Avenue
Seattle, WA 98101-2925
Attn: Michael F. Schumacher
Phone No. (206)623-1745
Fax No. (206)623-7789
To the City: Renton City Hall—5th Floor
1055 South Grady Way
Renton, Washington 98055
Attn: Gregg Zimmerman
Planning/Building/Public Works Administrator
Phone No. (425)430-7311
Fax No. (425)430-7241
and a copy to: Renton City Hall—6th Floor
1055 South Grady Way
Renton, Washington 98055
Attn: Alex Pietsch
Economic Development/Neighborhoods/Strategic
Planning Administrator
Phone No. (425)430-6592
Fax No. (425)430-7300
and a copy to: Warren Barber&Fontes, P.S.
Attorneys at Law
100 South Second Street
Post Office Box 626
Renton, Washington 98057
Attn: Larry Warren
City Attorney
Phone No. (425)255-8678
Fax No. (425)255-5474
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i J
All notices shall be deemed complete upon actual receipt or refusal to accept delivery.
7.2 Indemnity. Each party hereby agrees to defend, indemnify, and hold harmless
the other party against any claims; liability, or loss that may be incurred by or asserted against the other
party arising out of the negligence or willful misconduct of the indemnifying party or the breach by the
indemnifying party of its obligations hereunder.
7.3 Amendment, Waiver. No addendum, supplement, modification, termination or
amendment of this Agreement may be made except by written agreement of the parties. None of the
conditions of this Agreement shall ,be considered waived by FRB or the City unless FRB or the City issues
a written notice of such waiver. No waiver of any particular instance of default shall apply to any other past,
present, or future instance of default unless expressly stipulated in such waiver,, and each and every
covenant, agreement, term and condition of this Agreement shall continue in full force and effect with
respect to any other then existing'or subsequent breach thereof that has not specifically been waived in
writing. All the terms, provisions,,and conditions of this Agreement shall inure to the benefit of and be
enforceable by the parties' respective successors and assigns.
7.4 Captions! The captions of this Agreement are for convenience and reference only
and in no way define, limit or describe the scope or intent of this Agreement.
7.5 Merger of Prior Agreements. This Agreement and the exhibits hereto constitute
the final and complete agreement between the parties with respect to the subjectmatter hereof, and
supersede all prior agreements and understandings between the parties hereto relating to the subject
matter of this Agreement.
7.6 No Joint Venture; No Third Party Reliance. It is not intended by this Agreement
to, and nothing contained in this Agreement shall, create any partnership, joint venture or other
arrangement between the parties. No term or provision of this Agreement is intended to be, or shall be, for
the benefit of any person, firm, organization or corporation not a party hereto, and no such other person,
firm, organization or corporation shall have any right or cause of action hereunder.
7.7 Governing Law;Time. Pursuant to the Federal Reserve Act(12 U.S.C. 632),this
Agreement shall be governed and construed according to the laws of the United States and the United
States District Court for the Western District of Washington shall have original jurisdiction. In the event of a
determination that there is no applicable federal law , the laws of the State of Washington shall govern
without regard to its conflicts of law rules. Time is of the essence of this Agreement.
7.8 Incorporation of Exhibits. All exhibits attached hereto or referenced herein are
incorporated in this Agreement.
7.9 Severability. In the event that any one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, the party who
was seeking enforcement of such provision or who would otherwise be primarily benefited by such.
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provision may determine whether or not such invalid provision was essential to the overall agreement
contemplated hereby, and may issue a written notice to the other party electing either to invalidate this
Agreement in its entirety or to continue this Agreement in full force and effect without such invalidated
provisions, as if such invalidated provision had not been contained herein.
7.10 Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original, and all of such counterparts together shall constitute one and the same -
instrument. In addition, the parties hereto agree that this Agreement may be delivered either by a party or
its counsel by fax machine to the other party or its counsel and that signatures so transmitted constitute •
original signatures and are binding on the party so signing. Upon request, the parties shall further deliver
between themselves actual originally signed copies or counterparts, but such further delivery, or failure
thereof, shall not affect the validity or timing of this Agreement.
7.11 Gratuities. The City and FRB prohibit their employees from using their official
position for personal advantage and from accepting any personal advantage from anyone under
circumstances which might reasonably be interpreted as an attempt to influence the employee in the
conduct of his or her official duties. Neither the City nor FRB shall not extend any gratuity or special favor to
any FRB employee under such circumstances
7.12 Taxes. FRB is exempt from the payment of all taxes except those upon real
property by virtue of Section 7 of the Federal Reserve Act (12 U.S.C. 531), and therefore, any sales or
other taxes, levies, duties or assessments due in connection with any construction activities carried out by
FRB pursuant to this Agreement shall be paid by FRB's contractors to the extent required under applicable
state or local statutues. The City shall cause any and all taxes, levies, duties, and assessments of every
nature due in connection with the City's construction activities under this Agreement to be paid by the City,
its contractors, or other appropriate parties, as required under Washington law, and FRB shall not be
responsible for payment of such taxes, levies, duties, or assessments. Notwithstanding the foregoing,
however, FRB agrees that any such taxes, levies, duties, or assessments paid by the City or its contractors
in connection with construction of the Water Line or Sewgr Line and included in the total contract price for
such work shall be deemed"Water Line Costs"or"Sewer Line Costs", as applicable,for purposes of FRB's
reimbursement and/or payment obligations under Section 1.4, above, and that any such taxes, levies,
duties, or assessments paid by the City or its contractors in connection with construction or maintenance of
the Stormwater Detention Facilities and included in the total contract for such work shall be deemed
"Shared Costs"in which FRB shall share in accordance with Sections 3.5 and 3.9,above, as applicable.
7.13 Audits and Records. Both parties shall keep accurate records and books of
account showing any charges, disbursements, and expenses for which the other party may be responsible
therefore. Both parties shall keep these records and books of account for a period of at least 4 years after
such charges became due. All such records shall be open to audit, review, and copying by the other party.
Such records include, but are not limited to, accounting records, written policies and procedures; original
estimates; estimating worksheets; correspondence; memoranda; recordings; and any other supporting
AGREEMENT PAGE 18
#297409 18173-002.07 6DH103!.DOC
information reasonably required by the other party to substantiate any charges related to Agreement.
Records shall be available to the other party or authorized representative at mutually convenient times.
7.14 Payment by ACH. All payments made by FRB and otherwise due under this
Agreement shall be made by automatic deposit (ACH). FRB's obligation to make payments is conditioned
upon the City making appropriate and effective ACH payment arrangements with its financial institution and
providing the necessary paperwork, forms, and account number(s) to FRB. The City shall provide the
necessary information to FRB prior to FRB's making any payments for goods and/or services provided.
The City shall contact FRB's Accounts Payable Department at 415-974-2645 to obtain FRB's specific
requirements for putting this mechanism into place.
7.15 Separate Contracting and Accounting For Shared Cost Items. The City shall
separately account for, and shall require all contractors to separately track and invoice, each of the Water
Line Costs, Sewer Line Costs, and any Shared Costs or other costs with respect to the Stormwater
Detention Facilities (with the work with respect to which such shared costs are incurred referred to herein
collectively as the "Shared Cost Work'), separate and apart from any other construction costs related to
work performed by the City or its contractors pursuant to this Agreement. To the extent that any such costs
are indivisible or otherwise cannot be clearly attributed to the Shared Cost Work versus other work
performed under this Agreement, such costs shall be,allocated between such work items on a pro rata or
other equitable basis. In addition,; in bidding out the Shared Cost Work, the City shall define separate
scopes of work and, to the extent feasible, shall award the contract to the bidder with the most competitive
pricing for each of the Water Line, Sewer Line, and the Stormwater Detention Facilities.
The parties have executed this Agreement as of the date first set forth above.
THE CITY OF RENTON
4
By
Name:
Title:
•
•
•
AGREEMENT PAGE 19
#297409 18173-002.07 6DHD03I.Doc
THE FEDERAL RESERVE BANK OF SAN
FRANCISCO
By
Name:
Title:
#297409 18173-002.07 6dhd03!.doc 3/31/2005
•
4
AGREEMENT PAGE 20
#297409 18173-002.07 6DHo03Looc
I 1
•
STATE OF
ss.
COUNTY OF
On this day personally appeared before me , to me
known to be the of , the
that executed the foregoing instrument, and acknowledged such instrument to be the
free and voluntary act and deed of such , for the uses and purposes therein mentioned,
and on oath stated that he/she was',duly authorized to execute such instrument.
GIVEN UNDER MY HAND AND OFFICIAL SEAL this day of , 200_.
Printed Name
NOTARY PUBLIC in and for the State of
residing at
My Commission Expires
1
AGREEMENT PAGE 21
#297409 18173-002.07 6DHo03!.00c
•
STATE OF
} ss.
COUNTY OF
On this day personally appeared before me , to me
known to be the of , the
that executed the foregoing instrument, and acknowledged such instrument to be the
free and voluntary act and deed of such , for the uses and purposes therein mentioned,
and on oath stated that he/she was duly authorized to execute such instrument.
GIVEN UNDER MY HAND AND OFFICIAL SEAL this day of , 200_.
Printed Name
NOTARY PUBLIC in and for the State of
residing at
My Commission Expires
•
AGREEMENT PAGE 22
#297409 18173-002.07 60yo03!.00c
•
List of Exhibits
EXHIBIT A Conceptual Site Plan of Properties
EXHIBIT B Legal Description of Properties
EXHIBIT C Plans and Specifications for 27th Street Improvements
EXHIBIT D Construction Schedule for 27th Street Improvements
EXHIBIT E Plans and Specifications for Stormwater Detention Facilities
EXHIBIT F Construction Schedule for Stormwater Detention Facilities
EXHIBIT G Maintenance Schedule for Stormwater Detention Facilities
EXHIBIT H Form of Stormwater Detention Facilities Easement Agreement
LIST OF EXHIBITS
AGREEMENT PAGE 23
#297409 18173-002.07 6DHo03LDoc
•
EXHIBIT A
Conceptual Site Plan of Properties
•
•
AGREEMENT EXHIBIT A
#297409 18173-002.07 6DHDO3!.00c
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• q 9 1 y A 1110 tom area al w.B•I.414.537 SI(452 acres)aM total aBo 'd.
�i xm.r v) _bY),� • r \`• w A of...Wog 1m,vN1.a 73351 Y. 0 aae.ii yw"°"",n.u +ori•`
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_%j.�! ,.. CI • V is fbv.12.353 7. rota.95,755 57.
._,_ -, .�' STORMWATER
t I iiiiiii
e)w..:q B.1rea oama fiuv/lata.4,575 ss.
I�� DETENTION POND P)st.Entry Pest owe roa/lom.450 5<.
I ,ERE9PJiVE `� [a-_?� TRACT D i
r+s� i - I �— .Pat.taq.el.t cowed by�a�v a•wear.m US
PRncEs9woe D1. 1.275 ACRES /
. I �' L' I 1 .• aov SP4R..a .mmm.a Par.•v Bom0 r.m9a by as coax
a 9Peo.
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•
I—} -- r I v EC��. 1` I•t:
wSX 5.5 Imil1 0 IMelot.r.Wts per 1000 22 atd 1100100Y Ye''''far
s i e0 mh mE
..x ( f 1;....
— ! 106 mote pees Iv gfse me 53,pov+Iv VVMmu moat 1.11
' . '..I�'I..^_•- I � I 1 tela of 112 mi..and 179 mu off-.U.1 parking ePava
•
•
_ , :_ L'..L. s ace E.
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•
i.-�. i j _ E,�. +I stmrara 95.Prem o r..273
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• I , _ � /' •Smart ImtoDar9n9 IPl Immtmh9(DaM•1.I •❑ ❑ ;I ; if I..., SECOREMUG%eou.r 'I6 ' t Water landscape•too 57
I�• I i) I ..-.tai- • Pen nae Im4ta,•(a...i.5'oey).1,570 X
II 0 QIGO 910'F •'Nl.ar ImmaBo.town..17.61 a parYFq am
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v.._...;`.t. •,_...'._..::...i.-_I-l. Int. l
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f■ OEN OAD.tGI jj I--
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��� r `- =:1I i I I I I I .I / EXISTING
iETIAN S .
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•
111. 111.11'd1 .161‘2: 11041. 111.. I
• ;•lint. 0 0111.10 OOP. 7? .
PM LK I
10.001/1 r,of r,.
• :f '.;d9?' atiwut. :::;:;{ir ARCY.rEOTUBAL
tumat,.;wo}.::•'::•:.?i:':•:•;' �„r•.u''m'•
' SITE PLAT,
— ,aelor.Rf.o3/0.706
•
�
/� A010
EXHIBIT B
Legal Description of Properties
Subject Property:
Lot 33 and Tract D, as shown in the Boeing Longacres Property Amended Binding Site Plan recorded in
Volume of Plats at Pages_through , inclusive, under Recording No.
in the official records of King County, Washington.
FRB Parcel:
Lot 33, as shown in the Boeing Longacres Property Amended Binding Site Plan recorded in Volume
of Plats at Pages _ through , inclusive, under Recording No. in the
official records of King County,Washington.
Stormwater Parcel:
Tract D, as shown in the Boeing Longacres Property Amended Binding Site Plan recorded in Volume
of Plats at Pages _ through , inclusive, under Recording No. in the
official records of King County, Washington.
27th Street Parcel:
Tract F, as shown in the Boeing Longacres Property Amended Binding Site Plan recorded in Volume
of Plats at Pages _ through , inclusive, under Recording No. in the
official records of King County, Washington.
AGREEMENT EXHIBIT B
#297409 18173-002.07 6DHDO3LDOC
1,
EXHIBIT C
Plans and Specifications for 27th Street Improvements
In lieu of attachment, reference is hereby made to those certain Plans and Specifications known as the
Strander Boulevard Extension -Stage 1, 60% Review drawings dated 211/05, and prepared by Perteet,
Inc.
AGREEMENT EXHIBIT C
#297409 18173-002.07 6DHDO3LDOC
• •
EXHIBIT D
Schedule for Plans, Specifications, Bidding,
Contracting &Construction of 27th Street Improvements
Grace Cure
Milestone/ Period Period
Deadline (days) (days) Item
NEPA or SEPA deadlines or milestones
7/01/2005' 45 20 60% of engineering and construction detail to be complete, incorporated
into plans and specifications, and provided to FRB
1/01/2006 * 100% of engineering and construction detail to be complete,
incorporated into plans and specifications, and provided to FRB for FRB
approval
7/15/2006 * * Public submission of bid request for construction of 27th Street
Improvements/Go out to Advertisement
8/01/2006 60 20: Selection of Contractor for 27th Street Improvements
9/01/2006 60 20 Execution of general construction contract and any trade-specific
contracts for 27th Street Improvements**
Construction Milestones and Completion
3/01/2007 60 30 Construction Complete
*The City of Renton cannot complete design until several approvals and reviews are completed including:
Environmental NEPA, R-O-W certification, R-O-W plans, detention pond design (FRB to complete),
Franchise Utilities agreement, and Federal approvals.
** The schedule assumes that construction of the road can occur while construction of the FRB building is
ongoing.The City will make every effort to complete the road as soon as possible.
AGREEMENT EXHIBIT D
#297409 18173-002.07 6DHD03Looc
EXHIBIT E
Plans and Specifications for Stormwater Detention Facilities
In lieu of attachment, reference is hereby made to those certain Plans and Specifications known as the
Federal Reserve Bank—Seattle Building Project 50% Design Development Review, drawings C510, C511
dated 3/4105, and prepared by BOORA Architects and KPFF Engineering.
•
AGREEMENT EXHIBIT E
#297409 18173-002.07 6DHD03IAOC
•
EXHIBIT F
Construction Schedule for Stormwater Detention Facilities
Design of Plans and Specifications,Bidding,and Contracting
Grace Cure
Milestone/ Period Period
Deadline (days) (days) Item
[what NEPA or SEPA deadlines or milestones may we propose?]
__/__/2005 %of engineering and construction detail to be complete,incorporated into
plans and specifications,and provided to City
_/ /2005 100%of engineering and construction detail to be complete,incorporated into plans
and specifications,and provided to City for City approval
__/__/2005 Submission of bid requests for construction of Stormwater Detention Facilities
__/_/2005 Selection of Contractor for Stormwater Detention Facilities
/2005 Execution of general construction contract and any trade-specific contracts for
Stormwater Detention Facilities
Construction Milestones and Completion
I/2005 Excavation and grading commenced
AGREEMENT EXHIBIT F
#297409 18173-002.07 6oHo03!.000
EXHIBIT G
Maintenance Schedule for Stormwater Detention Facilities
Basic Maintenance Items:
Frequency or Est.Total Est.Cost of,
Time of Year Hours of Labor or
Labor Replacement Description of Labor or Replacement or Repair
Components
Estimated Total Annual Cost:
AGREEMENT EXHIBIT G
#297409 18173-002.07 6oHo03Looc
• •
Maintenance Schedule for Stormwater Detention Facilities
Enhanced Maintenance Items:
Frequency or Est.Total Est.Cost of
Time of Year Hours of Labor or
Labor Replacement Description of Labor or Replacement or Repair
Components
Estimated Total Annual Cost:
•
•
AGREEMENT EXHIBIT G
#297409 18173-002.07 601100300c
EXHIBIT H
Form of Stormwater Detention Facilities Easement Agreement
- 1 .
Recording Requested By:
First American Title Insurance Company
When Recorded,Return to:
HILLIS CLARK MARTIN&PETERSON, PIS.
Attention: Michael F. Schumacher
500 Galland Building i
1221 Second Avenue
Seattle, WA 98101-2925
- i
AGREEMENT FOR EASEMENT AND COVENANTS
REGARDING STORMWATER DETENTION FACILITIES
Grantor: (1)THE FEDERAL RESERVE BANK OF SAN FRANCISCO
- (2)CITY OF RENTON
El Additional on page
Grantees: (1)THE FEDERAL RESERVE BANK OF SAN FRANCISCO;
(2)CITY OF RENTON•
(3)LONGACRES PARK,INC.
❑Additional on page •
Legal Description(abbreviated):
Q Additional on: EXHIBITS A&B
Assessor's Tax Parcel ID#s:
Reference Nos.of Documents Released or Assigned: n/a
•
AGREEMENT EXHIBIT H—PAGE 1
#297409 18173-002.07 6DHD03!.00C
• `
This Agreement for Easement and Covenants Regarding Stormwater Detention Facilities (this
"Easement Agreement"), dated for reference purposes as of , 2005, is made
and entered into by and between THE FEDERAL RESERVE BANK OF SAN FRANCISCO ("FRB") and
THE CITY OF RENTON (the "City").
[Notice to Recorder: FRB is currently the sole owner of the Easement Area described below, but because
the City ultimately intends to acquire ownership of such Easement Area by dedication and because FRB
and the City have both undertaken certain cost-sharing or other obligations with respect to the Easement
Area to benefit the other party, both FRB and the City have been shown as both "Grantor? and
"Grantees"under this Easement Agreement.]
RECITALS
A. FRB is the current owner of the real property described on Exhibit A attached hereto (the
"Easement Area"). FRB is also the owner of the real property identified as the "FRB Parcel"on Exhibit B
attached hereto. The City is the owner of the real property identified as the "27th Street Parcel"on Exhibit
B attached hereto. The Easement Area, FRB Property, and 27th Street Parcel are each depicted on
Exhibit C attached hereto.
B. FRB and the City are each parties to that certain Agreement dated
2005 (the "Agreement"). Pursuant to and as contemplated in the Agreement, the City is constructing or
shall construct certain "Stormwater Detention Facilities" on the Easement Area, which Stormwater
Detention Facilities are intended for the benefit of the FRB Parcel and the 27th Street Parcel (collectively,
the `Benefited Parcels"). It is intended that the ownership of the Easement Area will be dedicated and
conveyed to the City.
C. After acquiring title to the Easement Area, the City has agreed to perform Certain tasks and
responsibilities relating to maintenance and upkeep of the Easement Area. However, the City and FRB, as
owners of the Benefited Parcels, have agreed to share the costs of such maintenance and upkeep in
accordance with the terms and conditions set forth in the Agreement. Longacres Park, Inc. ("Longacres"),
the owner of certain property located adjacent to the FRB Parcel and legally described and identified on
Exhibit B as the"Longacres Parcels", is listed as a beneficiary under this agreement solely for purposes of
Section 6, below, related to any amendments or modifications of this Agreement.
D. The parties have executed this Easement Agreement to (i) establish permanent
stormwater drainage easements on Easement Area for the benefit of FRB and the City, as the owners of
the FRB Property and the 27th Street Parcel, respectively, and (ii) provide public notice of the perpetual
covenants, conditions and restrictions set forth in the Agreement, which covenants shall constitute
covenants the run with the land and benefit and bind all successors and assigns who own such parcels.
AGREEMENT EXHIBIT H—PAGE 2
#297409 18173-002.07 6DHDO3!.00c
EASEMENTS AND AGREEMENTS
In consideration of the mutual promises and covenants set forth herein and in the Agreement, and
for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereby agree as follows:
I ,
1. Grant of Easement.I FRB, in its capacity as owner of the Easement Area, hereby conveys
and grants to the City, in its capacity as owner of the 27th Street Parcel, and to FRB, in its capacity as
owner of the FRB Parcel, a non-exclusive perpetual easement (the "Easement") under, over, and across
the Easement Area for the purpose of installing, constructing, operating, inspecting, maintaining, repairing,
replacing, and using the StormwaterlDetention Facilities in accordance with the terms of the Agreement,
including without limitation, the right Ito operate, inspect, maintain, repair, replace, and use the same for
purposes of detaining stormwater emanating or flowing from the FRB Property and the 27th Street Parcel.
2. Allocation of Stormwater Detention Capacity According to Stormwater Percentages;
Liability for Violation.-Of the total detention capacity of the Stormwater Detention Facilities, 55% shall be
allocated to the FRB Parcel for stormwater flowing from the FRB Property, and 45% shall be allocated to
the City for stormwater flowing from the 27th Street Parcel (such percentages.are referred to as the
"Stormwater Percentages" of each such property). The owner of each Benefited Parcel agrees to design,
permit, and construct stormwater drainage and/or detention facilities on its parcel so that the amount of
stormwater detention that it is permitted to utilize within the Easement Area, based on calculations made
under the Washington Department of Ecology Stormwater Management Manual for Western Washington,
August 2001 edition, willnot exceed its Stormwater Percentage of the total detention capacity of the
Stormwater Detention Facilities. If the Stormwater Detention Facilities shall ever become overloaded or
shall fail because the owner of either Benefited Parcel has violated this provision, then the owner of the
Benefited Parcel.who is guilty of such violation shall be solely obligated.to repair and to pay for the cost of
repair of any damage to the Stormwater'Detention Facilities or to the other Benefited Parcel that was
caused by such violation, and shall'promptly commence the design, permitting, and construction of such
additional stormwater drainage or detention facilities on its respective Benefited Parcel as are required for
such party not to be in violation of this provision governing the allocation of the total capacity of the
Stormwater Detention Facilities.
3. Construction of Stormwater Detention Facilities. The Stormwater Detention Facilities
shall be constructed, and all associated construction costs shall be allocated, in accordance with the terms
of the Agreement.
4. Dedication of Easement Area; Easement Survives. Within 30 days after the closing of
the sale of FRB's purchase of ,the Easement Area from Longacres (which closing is occurring
contemporaneously with recordation of this Easement Agreement), FRB shall have the right to dedicate the
Easement Area to the City, and the City shall accept such dedication and assume ownership of the
Easement Area and shallperpetually use the Easement Area solely for purposes of stormwater detention
AGREEMENT EXHIBIT H—PAGE 3
#297409 18173-002.07 6DHD031.Doc •
• •
and solely for the benefit of the 27th Street Parcel and the FRB Parcel. Notwithstanding such dedication
and transfer, the Easement granted hereunder to FRB and the City for the benefit of the Benefited Parcels
shall survive and shall continue in effect perpetually, unless modified by a written instrument executed and
delivered by the then-current owners of the Easement Area, the FRB Property, the 27th Street Parcel, and,
pursuant to Section 6, the Longacres Parcels.
5. Maintenance of Stormwater Detention Facilities; Allocation of Costs. Upon such
dedication and transfer, the City shall own and shall continue to own the Easement Area, and the City shall
thereafter perform all of the maintenance and upkeep tasks and responsibilities described in the
Agreement, and shall perform such other repairs, replacements, and maintenance as are required to
continuously preserve the Stormwater Detention Facilities and the Easement Area in a neat, clean, and
safe condition, in compliance with all statutes, ordinances, and other laws, and in conformity with all permit
conditions, restrictions, and other requirements established with respect to the Easement Area under the
binding site plan under which the Easement Area was created or is governed, and under any permit
conditions associated with the permits and approvals given with respect to the 27th Street Parcel and the
FRB Parcel. The costs of such maintenance shall be allocated between and shall by paid by FRB, as
owner of the FRB Parcel, and the City, as owner of the 27th Street Parcel, in accordance with the cost-
sharing provisions of the Agreement.
6. Covenants Running with the Land; No Merger; Termination. The Easement and the
agreements contained herein and in the Agreement shall be deemed covenants running with the land and
shall inure to the benefit of, and shall be binding upon the owners of the FRB Parcel, the 27th Street Parcel,
and the Easement Area, together with their respective successors, grantees, heirs and assigns.
Notwithstanding FRB's or any future owner's ownership of both the Easement Area and either Benefited
Parcel, the Easement and covenants established hereby and under the Agreement are not intended and,
shall not be deemed to have merged with the fee interest in such properties. The Easement and the
covenants referenced herein and established hereby may be modified or terminated only by the recording
of an amendment or notice of termination executed by all of the owners of the Easement Area, the FRB
Parcel, the 27th Street Parcel, and each of owners of the Longacres Parcels (who shall be deemed
beneficiaries under this Easement Agreement solely for purposes of this Section 6, and not for any other
purpose, and who shall not have any other rights or obligations under this Easement Agreement).
7. Incorporation and Notice of Agreement. The terms and conditions of the Agreement
are hereby incorporated by reference. Any party acquiring an interest in the FRB Parcel, the 27th Street
Parcel, or the Easement Area is hereby notified and instructed to obtain a copy of the Agreement, certified
as current, true, and accurate by the owners of such parcels, and shall in any event be bound by the terms
of this Easement Agreement and the Agreement. For this purpose, the parties can be contacted at the
following addresses or by such other addresses as may then be on file with the County Assessor as to the
owners of such parcels:
AGREEMENT V EXHIBIT H—PAGE 4
#297409 18173-002.07 6011D03!.DoC
FRB: Federal Reserve Bank of San Francisco
101 Market Street
San Francisco, CA 94105
Attn: Chief Operating Officer
with a copy to: Federal Reserve Bank of San Francisco
101 Market Street, Mail Stop 730
P.O. Box 7702
San Francisco, CA 94105-1530
Attn: Legal Division
and a copy to: Federal Reserve Bank of San Francisco
101 Market Street, Mail Stop 730
' P.O. Box 7702
• San Francisco, CA 94105-1530
Attn: Director, District Facilities Management
Renton City Hall-5th Floor
To the City: ' 1055 South Grady Way
Renton, Washington 98055
Attn: Gregg Zimmerman
Planning/Building/Public Works Administrator
• Renton City Hall—6th Floor
and a copy to: 1055 South Grady Way •
Renton, Washington 98055
Attn: Alex Pietsch
Economic Development/Neighborhoods/Strategic
4 Planning Administrator
and a copy to: Warren Barber&Fontes, P.S.
' Attorneys at Law
100 South Second Street
Post Office Box 626
Renton, Washington 98057
Attn: Larry Warren
City Attorney
AGREEMENT EXHIBIT H—PAGE 5
#297409 18173-002.07 6DHD031.Doc
• •
8. Attorneys' Fees. If, by reason of any default hereunder on the part of either party, the
other party employs an attorney, the defaulting party shall pay the non-defaulting party's costs, expenses
and attorneys'fees reasonably expended or incurred in connection therewith.
EXECUTED as of the date first above written.
FEDERAL RESERVE BANK OF SAN FRANCISCO
[FRB in its capacity as
owner of the Easement Area
and grantor of the Easement]
By
Name:
Title:
FEDERAL RESERVE BANK OF SAN FRANCISCO
[FRB in its capacity as
owner of the FRB Parcel,
grantee of the Easement,
and obligor under its obligation
to share costs of maintaining By
the Easement Area] Name:
Title:
THE CITY OF RENTON
[City in its capacity as
owner of the 27th Street Parcel,
grantee of the Easement,
and obligor under its obligation
to share costs of maintaining By
the Easement Area] Name:
Title:
•
AGREEMENT EXHIBIT H-PAGE 6
#297409 18173-002.07 6DH0031.Doc
STATE OF
} ss.
COUNTY OF
On this day personally appeared before me , to me
known to be the of , the
that executed the foregoing instrument, and acknowledged such instrument to be the
free and voluntary act and deed of such , for the uses and purposes therein mentioned,
and on oath stated that he/she was duly authorized to execute such instrument.
GIVEN UNDER MY HAND AND OFFICIAL SEAL this _day of , 200_.
Printed Name
NOTARY PUBLIC in and for the State of
residing at
My Commission Expires
•
4
•
AGREEMENT EXHIBIT H—PAGE 7
#297409 18173-002.07 6DHo03Lo0C
• •
STATE OF
ss.
COUNTY OF
On this day personally appeared before me , to me
known to be the of , the
that executed the foregoing instrument, and acknowledged such instrument to be the
free and voluntary act and deed of such , for the uses and purposes therein mentioned,
and on oath stated that he/she was duly authorized to execute such instrument.
GIVEN UNDER MY HAND AND OFFICIAL SEAL this day of , 200_.
Printed Name
NOTARY PUBLIC in and for the State of ,
residing at
My Commission Expires
AGREEMENT EXHIBIT H—PAGE 8
#297409 18173-002.07 6DHD031.DOC
STATE OF
} ss.
COUNTY OF
On this day personally appeared before me , to me
known to be the of , the
that executed the foregoing instrument, and acknowledged such instrument to be the
free and voluntary act and deed of such , for the uses and purposes therein mentioned,
and on oath stated that he/she was duly authorized to execute such instrument.
GIVEN UNDER MY HAND AND OFFICIAL SEAL this day of , 200_.
Printed Name
NOTARY PUBLIC in and for the State of
residing at
My Commission Expires
f
AGREEMENT EXHIBIT H—.PAGE 9
#297409 18173-002.07 60H003!.000
• • • ••
Exhibit A
(to Stormwater Detention Facilities Easement Agreement)
Legal Description of Easement Area
(to be completed upon recordation of the Amended Binding Site Plan)
Tract D, as shown in the Boeing Longacres Property Amended Binding Site Plan recorded in Volume
of Plats at Pages through , inclusive, under Recording No. in the
official records of King County, Washington.
•
AGREEMENT EXHIBIT H—PAGE 10
#297409 18173-002.07 6DHDO3L000
Exhibit B
(to Stormwater Detention Facilities Easement Agreement)
Legal Description of Grantees' Property
(to be completed upon recordation of the Amended Binding Site Plan)
27th Street Parcel:
Tract F, as shown in the Boeing Longacres Property Amended Binding Site Plan recorded in Volume
of Plats at Pages _ through , inclusive, under Recording No. in the
official records of King County, Washington.
FRB Parcel:
Lot 33, as shown in the Boeing Longacres Property Amended Binding Site Plan recorded in Volume
of Plats at Pages _ through , inclusive, under Recording No. in the
official records of King County, Washington.
Longacres Parcels:
Lots 27 through 32, inclusive, and Tthct H, as shown in the Boeing Longacres Property Amended Binding
Site Plan recorded in Volume of Plats at Pages_through , inclusive, under Recording No.
in the official records of King County,Washington.
AGREEMENT EXHIBIT H—PAGE 11
#297409 18173-002.07 6DHD03L000
410 •
Exhibit C
(to Stormwater Detention Facilities Easement Agreement)
Map With Depiction of Properties
[Attach sheet 7 of 7 of Amended Binding Site Plan.]
AGREEMENT EXHIBIT H—PAGE 12
#297409 18173-002.07 60H003!.000
MAhAitize 0-6*,
ciu l
CITY OF RENTON
PLANNING/BUILDING/PUBLIC WORKS DEPT.
MEMORANDUM
DATE: April 11, 2005
TO: Terri Briere, Council President
Members of the Renton City Council
VIA: Kathy Keolker-Wheeler, Mayor
FROM: Gregg Zimmerman
STAFF CONTACT: 'Gregg Zimmerman
SUBJECT: FRB Agreement Cost and Revenue Estimates
This memorandum contains some additional information about the financial aspects of
the Agreement with the Federal Reserve Bank regarding the 27th Street Parcel/Storm
water Detention Parcel.
City Funding Previously Committed to the SW 27th St./Strander Blvd.Project
A question came up during the April 7 Transportation Committee meeting regarding the
City's previous commitments of funding to this project(other than Transportation Capital
Improvement 317 funds). A review of financial records revealed that in 2003 the City
Council allocated $1,000,000 of general fund money for this project. This funding has
been spent in the preparation of the 30% design for the project, and so is no longer
available. No funding for this project was found in Fund 502, the Insurance Fund (there
is a$660,000 line item in the insurance fund for "South Renton Reserve", but no funding
for the Strander project). In March, 2004 the Administration recommended that
$500,000 of the $2.216 M King County mitigation funds for the South Treatment Plant
Co-generation facility be allocated to•the Strander Blvd. project, but the City Council
instead placed this funding into a King County Mitigation Reserve Account within the
Transportation Capital Improvement Fund 317 budget. Documentation of these actions is
attached. There is currently no funding in the City budget for this project other than the
$1,020,000 shown in the 2005 Reallocation request for completion of the 30% design
($810,000) and 100%design of Segment 1 ($210,000) of the project.
Recent Grant Funding that May be Applied to the Phase 1, Segment 1 portion of
SW 27th St./Strander Blvd.Project
The City recently received a TEA-21 federal Earmarking grant of $750,000 for the
Strander Blvd. project. We are in discussion with the grant administrators about using
$496,000 for Segment 1 of this project. If the City is able to apply this funding to
Segment 1 of the project,the amount of the bond issuance could be reduced to $2.5 M.
Document2\g
Page 2.
Approximate Cash Flow for the SW 27th St./Strander Blvd. Segment 1 Project
Capital Improvements
Revenues:
Bond Issue: $3,000,000
TOTAL REVENUES: $3,000,000
Expenses:
Franchise utilities design/construction $0 FRB responsibility
Water utility construction $0 City pays costs over$278,815
Sewer utility construction $0 City pays costs over$90,000
Stormwater detention parcel purchase $381,368 45%paid by City, 65%by FRB
Stormwater detention pond construction $207,900 45%paid by City, 65%by FRB
Road construction $1,899,665
Contingency $257,900
Miscellaneous/road design(staff) $253,167
TOTAL EXPENSES: $3,000,000
Estimated annual revenues/expenses
Item Annual Revenue Annual Expenditure
Property and other Tax $130,000
Bond Payments(20-year) ($300,000)
Estimated one-time revenues
Construction sales tax $200,000
Water SDC fee $88,329(to Utility Capital Fund 421)
Sewer SDC fee $52,251 (to Utility Capital Fund 421)
Stormwater SDC fee $26,145 (to Utility Capital Fund 421)
Transportation Mitigation fee $40,320,but we expect this to be covered by
Boeing's Transportation trip fee credits on the
site,so will not be paid to City.
Document2\g
•
r • . RECEIVE' APPROVED BY
.
• , N--12:2001' . . CITY COUNCIL
. TRANSPORTATION/AVIATIWN- E
• COMMITTEE REgtjgyI1wORKS ADMIN Date., ��"
• June 11,2001 _- - -
•
•
Use:of Mita ation-Mone $500`00:0y A;sociatedwithjtl eK I oounny:`�E_SI Sec on
do ..1Sewer-�'�
Interce tor.._Ca _,. e r i n:, : _ ... _ `..�- r. . :44,2-;-00±.,4
.�:.;,.5:-:::_:_,:._-:_-=�_�-;:-::ir;• :._,_ C ac>< R sto a#o Pro c�rn`�o htent6n=_.. -
err n .I _001
- The Transportation and Aviation Committee having considered the matter of mitigation money from .
•
-the Metro.South Renton-Interceptor.Sewer restoration project and the need for the reconstruction of
Lind Ave. South from SW 43`d to SW 21'Streets have determined the following: - -
a) It is important that the area knownlas the Burnett South Renton area have funds in the amount of .
$500,000 committed to restore and,mitigate the nuisance they will have to endure throughout the.
:-life of this project. .
• - b) It is important and vital that the reconstruction of Lind Ave: S be completed prior to any more.- - _ -- -- --
.deterioration of the roadway that would result in the total rebuild of the roadway. • . • • - •- . . -
• The Transportation and Aviation Committee recommends the:lollowing actions: _, - •
1. $115,000 . of :the •• fetro i 2_ tigation -:. funds be •placed -- ..n account• -'
• #317.012194.016.5950.000067:000000.titled-South Renton. �ro t. .The funds to be used in.the•• - -
following manner:$75,000 to be used to asphalt overlay str ;.ne area and$40,000 to be used .
• . . •' to study the intersection of South 4th Street and,Burnett Ave South-for possible improvements. .' • - •- •• •'
-. 2 •$325,000 :of _the :*Metro mitigationg a s 4N„,,,-;placed in t•he Street -Overlay•: Account .
' . #317.012108.016.5950:0000 67.00VOOato a e:used•to:reconstru and Ave. SW from'SW 43 to
-. - :SW 21gStreets. . :.:" x•-... `�--. .r• -. 1•12 �.� .. - -.. _. .. _ . . .. . .. .. .. .-
• - - •rz .ai. - ?'+"?tom_, - y .''. . .
•
•
3. . $325,000 be transferred 'rom reserve:fund #502.000000 .0055140. 000.04.000000 to contingency . .
fund account#502:000000.005:0070.05.000000 titled Reserved:or South Renton Project. - - -• -------------------•
04 $60,000 of the Metro.mitigation ffiiids'be_placed in the Re'seervedf or South Renton Projects•fund • .
• #502.000000.005.5140:0070.05.000000.";° : , ; :`,; ".1 '-
•Don Persson,Chair. - .. • ' •
-
. • *',.-:-•-• . -... ' '::::::/thgeilv .*::.'W 49.4-0-.- ::... ....... .--...:•: '....:-....-••...:. . '::-•-' . '.- :. 1: .-.. : -i. • .- ••i .f '... . '.-
• .. : Ka y•Ke ker-Wheeler;Vice Chair •: :.••:..' -._ -- - - - .
Brier
- e;•' tuber_ -•
cc:i.: s3regg linitr.
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'
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- -
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. :ESIMitFund. \�' � -. " rev01/O1 bh ..
,
. -
• ,.._._, —, \
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• .
- APPROVED BY. 1
•
CITY COUNCIL • 1
COMMITTEE OF THE WHOLE • Date ,5--/4--OV
• COIVIMITTEE REPORT . • .
. .
- •
• ..
March 15,2004 .
•
• • .
•
- • • . . •
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.. :
• • ••
. . . . .
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. . . .
. . . .
• . •. King County Mitigation Funds . . • . • . .
. • , . •
. . • (Referred November 10,2003)
. .
, . . . _
. . • •
. . . . . . .
. .
. . . . .
. • . " . •
. .
. -• The City of Renton entered into.an agreement with King County for South Plant . .
. :
.. (Wastewater Treatment Plant)electrical cogeneration project•The agreement brought. . , .. • . : .
..- • • .. $2,216,000 in mitigation funds tO be split between four known transportation capital projects • . ' •
and one City capital project(to be determined). . . . - . . . . .. .•
. .
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• • • • , • • • • . . .. .
. . . .
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• : • ' .: The Committee of Whole qt0itt*the.falrAtivenspottatipii capital projects for . • '
. ... . • placement of funding:.• ', „:,,-,;0•.5'..-1-' ••• • . lg. : - ..,.,:.7-44.,,...,
. .
• - :::s•• , .,..i..,:„... .
• .. .•• . . • . . :
...
--: • . ••-:** '. • SR 109-(Phase p•, . .. : „•,,,i- .... ,es.:...-- .. .. s1,2o0, . o '. . to. account#317.012175:: - •:. -
. ..
• • .:. .
: .- •• . ' Benson Road Pedestrian :. '''?''''-i-•;';: ;... l'''OV:ttAt,50,000- ‘'inio., ••account.#311.-.012300.: -.•-. ' • '. .
:, . . • .!--:''. -,,,0 ;;•:•'.'"'4 ., • - • ' • • • - - : '
• ... ".----:;.. :7 • ?,!' 4'•'''". Ad•7,-.,h,.;:,,.,.:. *- .., ,..:: •-:• . .-0 .. i . - . • .. . . ... .. .:. . ..
: •. Walkway Program(Highlatic‘sioe(alPg-filki:-. -•,066,0.00 . .44,,iiiti account 4417.600009
• • .." • . • .•:'-;:•••. -'''.- -.1-:-• ..-• '•;.•'.171;..4:.V.,1r4:-....- . i' .4s0 . • . .-:•••• •• , . . -
• • .. • Arterial-Rehnbilititim(OlireriaY*li.4.04e) 00,000.. • -m -account#317.(11216- .....-: ...:. . .
,,- -• ,-.,. .
.'
.. .. .- • - 1'4'; ... .•': -r.. v.: . • — ,...r. .'-.I i : : . . . . • - . • •
. . .
The remaining t500,000:Willi*ottIlAtoaXing.•COAls'il g tton Reserve account.pus. ..i. • • --:.,.. • '.. :
'• ..,•
account must be a capital Project'iteautiuid4an...bii raVettOr any.citywide Capital project- .. • [ .. .
- ' • account designated. The•currentaccoarindicateifietilacelielder.accoMit Only. • . s. • • . -
. ,. .
•• • Kling.County Mitigation Reserve : $500,000 into account#317.01 2310 • .• ' •
•. . .
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" • . .•
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• •
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Don Persson, council President •• . .- •
• .
. .
• • . . . . • • .
• • . . . . .
• . • .
• cc: Gregg Zimmerman . . • . .
. Sandra Meyer •
Nick Afiali -
Sylvia Doe*hei •
Sharon Griffin
•
Connie 13rundage •
H:Transtadmin/Director tilesMetromitigation doc
la&0le
Fund 502,Insurance Fund
Fund 502, is an internal service fund which provides accounting
for self-insurance services to all City departments for losses on
property, liability,worker's compensation,unemployment
compensation and a healthcare program. Expenses are paid by the
Insurance Fund and rates are charged to departments based on use
and/or coverage requirements. Effective January 1,2004 a new
Fund 512,Healthcare Insurance Fund was created to report all
healthcare related items.
Table 6-46. Fund 502, Insurance Fund
2002 2003 2004 2004 2005 Change
Item I Actual Actual Adj Bdgt Actual Budget 04/05
REVENUE: �
Interest Earnings , 50,000 124,994 50,000 0.0%
Uab/Prop Ins Premiums 1,840,800 1,840,800 1,932,400 5.0%
Industrial Insurance Premiums 715,800 831,764 786,700 9.9%
Unemployment Comp Premiums 114,700 114,700 114,700 0.0%
Judgements/Settlements/Misc 0 136,497 0 N/A
Other Financing Sources,Transfers in 940,000 940,000 0 -100.0%
TOTAL NEW REVENUE 3,661,300 3,988,755 2,883,800 -21.2%
Use of Prior Yr Revenue 162,500 0 665,500 309.5%
TOTAL RESOURCES 3,823,800 3,988,755 3,549,300 -7.2%
EXPENDITURES:
Regular Salaries • 104,800 106,521 109,100 4.1%
Personnel Benefits 31,400 27,967 32,700 4.1%
Other Benefits:
Worker's Compensation 467,000 560,310 467,000 0.0%
Unemployment Compensation 142,000 83,421 142,000 0.0%
Professional Services:
Industrial Ins Administrative Costs 250,000 273,983 250,000 0.0%
Other Miscellaneous Services 42,000 2,500 42,000 0.0%
Insurance:
Property/Liability Claims 987,800 817,662 1,737,000 75.8%
Premiums&Assessment Fees 634,300 619,863 703,200 10.9%
Travel/Training 2,000 1,517 2,000 0.0%
Miscellaneous:
Memberships/Reg/Publications I 2,500 410 2,500 0.0%
Emergency Services 100 2,180 100 0.0%
Transfer Out to Fund 512 1,100,000 1,100,000 0 -100.0%
Interfund Payments 59,900 59,900 61,700 3.0%
TOTAL COMMITTED EXPENDITURES 3,823,800 3,656,234 3,549,300 -7.2%
Increase to Reserves 0 0 0 N/A
TOTAL EXPENDITURES 3,823,800 3,656,234 3,549,300 -7.2%
Fund Balance,January 1 7,611,589 7,611,589 7,944,110 4.4%
Total New Revenue 3,661,300 3,988,755 2,883,800 -21.2%
Total Committed Expenditures (3,823,800) (3,656,234) (3,549,300) -7.2%
Fund Balance Plus Reserves 7,449,089 7,944,110 7,278,610 -2.3%
Anti cessionary 2,100,000 2,100,000 2,100,000 0.0%
South Renton Reserved
660,000 660,000 660,000 0.0°0
Reserve for Claims 750,000 750,000 0 -100:073
Operating Reserves of GG Funds 5,420,448 5,116,291 4,518,610 -16.6%
Fund Balance,Dec 31 (1,754,359) (682,181) '0 -100.0%
Budget by Fund
6-49
CITY OF RENTON
PLANNING/BUILDING/PUBLIC WORKS
TRANSPORTATION SYSTEMS DIVISION
2005-2010 SIX-YEAR TIP
Strander Boulevard/SW 27th Street Connection Functional Classification: Minor Arterial Fund: 317
Proj.Length: 1.27 miles Proj: 12239
RANK: 3 CONTACT: Rob Lochmifer 425.430.7303
DESCRIPTION: STATUS:
This project provides a critical four/five lane arterial that will serve as a connector to West Valley Highway Up to 30%design was contracted in March 2003 for$2,213,349. It includes the EIS
(SR-181)and East Valley Road,as well as an arterial connector to SR-167 from the south.The project will document,base-mapping,road sections,and project phasing by June 2005. Survey and a
provide a grade-separated crossing at the Union Pacific Railroad(UPRR)and Burlington Northern Sante preliminary geotechnical report is complete. $1,000,000 was received from the General
Fe(BNSF)railroad tracks. Segments 1 and 2 include from West Valley Hwy to East Valley Road. Fund in 2003. $745,563 TEA-21 was obligated in May 2003. The design and construction
costs reflect Segments 1 and 2
JUSTIFICATION: CHANGES:
A new east-west arterial roadway will connect the Cities of Renton and Tukwila,and provide significant Lost$1.4 million in projected Vehicle License Fees for this project. Boeing donated
congestion relief to existing arterials. The new road will provide direct access tothe new Tukwila Station, million of right-of-way to the project in 2004(shown in 2008). 2008 shows costs estimates
a multi-modal center being developed immediately north of the new alignment,and to the Boeing for phasing construction of the Strander extension from Oakesdale Avenue west to access
Longacres site. The eventual direct HOV connections to southbound SR-167 will provide significant the Boeing property,not totally funded. FMSIB awarded$4 million,for construction only,of
advantages to HOV and transit usage. By crossing under the UPRR and BNSF railroads,the new arterial the total project pending legislative funding.
will provide significant benefits to both freight mobility and to general motorists.
I Funded:I 6,045,4601 Unfunded:1 60.354,540
Project Totals Programmed Pre-2005 Six-Year Program
ITEM Programmed Spent In 2003 2004 Total 2005 2006 2007 2008 2009 2010
EXPENSES:
Proiect Development
Precon Eng/Admin 5,000,000 625,460 1,080,000 3,294,540 800,000 2,494,540
R-O-W(includes Admin) 4,000,000 4,000,000 - 2,500,000 1,500,000 '
Construction Contract Fee 52,200,000 52,200,000 4,000,000 24,100,000 24,100,000
Construction Eng/Admin 5,200,000 5,200,000 400,000 2,400,000 2,400,000
Other
TOTAL EXPENSES 66,400,000 625,460 1,080,000 64,694,540 800,000 9,394,540 28,000,000 26,500.000
SOURCES OF FUNDS:
1/2 Cent Gas Tax
Business License Fee 527,100 40,000 487,100 87,100 200,000 ` ')0
Grants In-Hand(TEA-21)• 745,563 401,502 � 344,061 —
Mitigation In-Hand 1,272,797 160,000 300,000 812,797 259,897 312,900 200,000 40,000
L.I.D.'s Formed
Other In-Hand(GF&Boeing) 3,500,000 63,958 395,939 3,040,103 540,103 2,500,000
Grants Proposed 4,000,000 4,000,000 _ 4,000,000
Mitigation Proposed
L.I.D.'s Proposed
Other Proposed(Metro Mitiq.) 500,000 500,000 500,000
Undetermined 55,854,540 55,854,540 5,994,540 27,600,000 22,260,000
TOTAL SOURCES 66,400,000 625,460 1,080,000 64,694,540 800,000 9,394,540 28,000,000- 26,500,000
er rderCa.raom
07/2Y2004 9..11 AM
5-3 FINAL
1 l r -J _�-.1 r + �