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HomeMy WebLinkAboutLimited Tax General Obligation Bonds Series 2011A - Downtown & Highlands Libraries - 2011 CERTIFICATE FOR TRANSCRIPT I, Bonnie I. Walton, City Clerk of the City of Renton, Washington (the"City"), do hereby certify that the within and attached documents are in each case true and correct copies of the originals of such documents and that none of the resolutions, ordinances, proceedings, statements or certificates contained herein have been repealed, rescinded or canceled and all of the officers last certified as holding City offices have continued to hold their respective offices from such date to and including the date of this certificate. Dated as of this 2nd day of!August,2011. vt Bonnie I. Walton, City Clerk City of Renton, Washington ,n,:,, yam, , :r, 1* SEAL = �J I CERTIFICATE I, Denis W. Law, the duly elected Mayor of the City of Renton, Washington (the "City"), do hereby certify that Iwen Wang I and Bonnie I. Walton are the duly appointed Finance and Information Services Administrator,and City Clerk,respectively, of the City. Dated as of this 2nd day of August,2011. Denis W. Law, Mayor City of Renton, Washington .1 SEA 1,, . oe' ji� 1491ScN.91 7r jUAVimininill;tl\0\��� I ji • • CERTIFICATE I, Bonnie I. Walton, City Clerk of the City of Renton, do hereby certify that the attached . is a true and correct copy of the proceedings of the City Council setting the date, time and place for regular meetings of the City Council. Dated as of this 2nd day of August,2011:.. Bonnie I. Walton, City Clerk City of Renton, Washington • eQ Sre ei\ d • • • CERTIFICATE I, Bonnie I. Walton, City Clerk of the City of Renton, Washington(the"City"), do hereby certify that the Renton Reporter is the official newspaper of the City. Dated.as of this 2nd day of August,2011. • • J Bonnie I. Walton, City Clerk City of Renton, Washington 14* • • • • i �/ltlr('s!1(ilflli111�1\\1 CERTIFICATE REGARDING OUTSTANDING DEBT I, Iwen Wang, Finance and Information Services Administrator of the City of Renton, Washington (the "City"), do hereby certify that the following are all of the City's currently outstanding general obligation bonds and long-term leases and financing contracts as .of August 2, 2011 (excluding the City's Limited Tax General Obligation Bonds, Series 2011A issued on the date hereof): Voted General Obligation Bonds: Designation Outstanding Balance $ 0 Nonvoted General Obligation Bonds and Obligations: Designation Outstanding Balance Fire Protection District No. 40 Promissory $ 6,292,404 Note 2001 LTGO &Refunding 11,350,000 2002 LTGO 2,690,000 2006 LTGO 16,355,000 2009 SCORE Bonds (1) 31,044,600 2010 Valley Corn. Bonds,(2) 1,044,000 2010 LTGO Refunding ; 6,030,000 (1) The South Correctional Entity Facility Public Development Authority issued bonds on November 4, 2009 (the "SCORE Bonds"). The par amount of the SCORE Bonds was $86,235,000 and pursuant to an interlocal agreement, the City is obligated to pay 36 percent of the debt service on the SCORE Bonds. (2) The Valley Communications Center Development Authority issued special obligation refunding bonds on April 5, 2010 in the total aggregate principal amount of$5,325,000 (the "Valley Com. Bonds"). Pursuant to an interlocal agreement,the City is obligated to pay 20.percent of the.debt service on the Valley Com.Bonds. Long-term leases and conditional sale contracts (including COPs) and other debt: Designation Outstanding Balance Dated as of this 2nd day of August,2011. Iwen W. I:, inance and Info 'on Services Administrator City of Renton, Washington CERTIFICATE REGARDING ORDINANCE I, Bonnie I. Walton, City Clerk of the City of Renton, Washington(the"City"), do hereby certify: 1. That the attached Ordinance No. 5(13 (the "Ordinance") is a true and correct copy of an ordinance of the City Council, as finally adopted at a regular meeting of the City Council held on June 20, 2011, and duly recorded in my office, and that such Ordinance has not been amended or superseded. 2. That the meeting was duly convened and held in all respects in accordance with law, and to the extent required by law, due and proper notice of the meeting was given; that a legal quorum was present throughout the meeting and a legally sufficient number of members of the City Council voted in the proper manner for the adoption of the Ordinance; that all other requirements and proceedings incident to the proper adoption of the Ordinance have been duly fulfilled, carried out and otherwise'observed; and that I am authorized to execute this certificate. Dated this 2nd day of August, 2011. J. 14.) � Bonnie I. Walton, City Clerk City of Renton, Washington et €ar * SEAL <<< ��. •rit,,�;��liil;;(ilii411t'•1C1\\,��\�? • CERTIFICATE, I, Bonnie I. Walton, City Clerk of the City of Renton, Washington(the "City"), do hereby certify that the attached is a true and correct copy of the minutes of the May 9, 2011 regular meeting of the City Council which reflects the first reading of Ordinance No. 5613. Dated as of this 2nd day of August,2011. Bonnie I. Walton, City Clerk City of Renton, Washington I* SEAL *rt l • • • • CERTIFICATE I, Bonnie I. Walton, City Clerk of the City of Renton, Washington(the "City"), do hereby certify that the attached is a true and correct copy of the minutes of the June 20, 2011 regular • meeting of the City Council which reflects the second reading and passage of Ordinance No. 5613. Dated as of this 2nd day of August,2011. d itice-tto Bonnie I. Walton, City Clerk City of Renton, Washington • sO • • • • CERTIFICATE OF MANUAL SIGNATURE 186'7141, Jade Signature STATE OF WASHINGTON ) ) ss. COUNTY OF KING ) I,the undersigned affiant,being first duly sworn, on oath depose and say: My name is I Bonnie I. Walton (Print or type) I have been duly chosen and am qualified and acting as City Clerk (title or position) • for 'City of Renton, Washington (name of municipality) The signature appearing above is my true manual signature. This affidavit is made to comply with Ch. 86, Wash. Sess. Laws of 1969. • Signature SUBSCRIBED AND SW RN TO before me this I of � �� , 2011. 1� Go • • ssIo.• tiF+ O Notary Public NO TAiy1, 7; Print Name MG`I ti ®,� y c My commission expires • CERTIFICATE OF MANUAL SIGNATURE Signature • STALE,OF WASHINGTON ) ) ss. COUNTY OF KING ) I,the undersigned affiant,being first duly sworn, on oath depose and say: My name is Denis Law (Print or type) I have been duly chosen and am qualified and acting as Mayor (title or position) • for :City of Renton, Washington (name of municipality) • The signature appearing above is my true manual signature. This affidavit is made to comply with Ch. 86,Wash. Sess. Laws of 1969. Signature SUBSCRIBED AND SWORN TO before me this of AV 1/ ,2011. c12s/ 71,�C�i s ' p� P4A'`� % Not*Public /j • s R5 rl Print Name J r,�F)til - e.,1--t1 g 58 — • _ Csx My commission expires k ' 7A -7-013 ti 9ttt'lit ti watt 5'6, ?- SIGNATURE IDENTIFICATION CERTIFICATE We, Denis W. Law and Bonnie I. Walton, the duly chosen, qualified and acting Mayor and City Clerk, respectively, of the City of Renton, Washington (the "City"), do hereby certify that the signatures appearing on each of the following-described Limited Tax General Obligation Bonds, Series 2011A(the`Bonds")1 of the City are true and correct facsimiles of our signatures. The Bonds are in the total principal amount of$16,715,000, are dated as of the date of their delivery, are designated "City of Renton, Washington, Limited Tax General Obligation Bonds, Series 2011A," are in the denomination of$5,000 each or integral multiples thereof, are fully registered, are numbered, bear interest at the rates per annum set forth in the following schedule, payable on December 1, 2011, and semiannually thereafter on-the first days of each succeeding June and December, anis mature on December 1 in the years and amounts as follows: Maturity Years Principal Interest (December 1) Amounts Rates 2012 $ 1,375,000 3.00% 2013 1,420,000 100 2014 1,460,000 3.00 2015*' 950,000 2.00 2015*1 555,000 3.00 2016 , 1,540,000 3.50 2017 ! 1,595,000 4.00 2018*, 1,375,000 . 2.25 2018* 285,000 4.00 2019* 350,000 4.00 2019* 1,350,000 • 5.00 2020* • 730,000 4.00 2020* 1,050,000 5.00 2021. 1,865,000 5.00 � ;,_.y 2022 815,000 • 5.00kl Alt `' * Bifurcated maturity. SFALrt Dated as of this 2nd day of August,2011. ` 41 to Signa e Title •7411/1,iri101:• S\e. Mayor . I. &aL-t -- City Clerk * * * * * * STATE OF WASHINGTON ) ss: COUNTY OF KING ) On this ` day of August, 2011, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared Denis W. Law, to me known to be the Mayor of the City of Renton, Washington, described in and who executed the within and foregoing instrument; and acknowledged to me that he signed said instrument as his free and voluntary act and deed for the uses and purposes therein mentioned. es'�`'ga:ete1114t4iip4 , ti. � � ee ��-^ • ,c No Public "[ ®[deal.or Stomp]; J tt c vt 4 • ° AUS.0o r [Printed Name] f %cf►A 6_2 iViVAVq8 m My commission expires tc- ;9- 10(3 P STA1 latagt1INGTON ) ) ss COUNTY OF KING ) On thisday of August, 2011, before me, the undersigned, a Notary Public in and for the State of ashington, duly commissioned and sworn, personally appeared Bonnie I. Walton, to me known to be the City Clerk of the City of Renton, Washington, described in and who executed the within and foregoing instrument; and acknowledged to me that she signed said instrument as her free and voluntary act and deed for the uses and purposes therein mentioned. --0 c4. fi . c\C7F` � ra� poi ec' A, ��,'%, ;, N tary Public S al Qz.Sta i] - c)vi 4 441 c, z • [Printed Name] %, q� - .:A9 4.7 My commission expires "(p -lei- Z©/3 as rrsi 2 p • -2- CLOSING CERTIFICATE OF THE CITY OF RENTON The undersigned hereby certifies and represents to Seattle-Northwest Securities Corporation (the "Underwriter") that she is the duly appointed and acting Finance and Information Services Administrator of the City of Renton, Washington (the "City") and is authorized to execute and deliver this certificate and further certifies on behalf of the City to the Underwriter as follows: 1. This certificate is delivered in connection with the offering and sale of the $16,715,000 Limited Tax General Obligation Bonds, Series 2011A(the "Bonds"). 2. The representations, warranties and covenants of the City set forth in the Bond Purchase Agreement for the Bonds (the "Purchase Agreement"), dated July 28, 2011, between the'City and the Underwriter, and in Ordinance No. 5613 of the City (the "Bond Ordinance") were true and correct when made and remain true and correct as of this date. 3. • No litigation or other proceedings are pending or, to my knowledge, threatened in any court in any way (a) affecting the position or title of the authorized officers of the City, or (b) seeking to restrain or to enjoin the authorization, issuance, sale or delivery of, or security for, any of the Bonds, or (c) contesting or affecting the validity or enforceability of the Bonds, the Bond Ordinance, the Purchase Agreement, or (d) contesting the completeness or accuracy of the Preliminary Official Statement or the Final Official Statement, or (e) contesting the powers of the City or its authority with respect to the Bonds, the Bond Ordinance or the Purchase Agreement, or(f)materially affecting the finances of the City. 4. No event affecting the City has occurred since the date of the Final Official Statement which. should be disclosed in the Final Official Statement for the purpose for which it is to be used or which is necessary to disclose therein in order to make the statements therein not misleading, and the Final Official Statement does not contain any untrue statement of a material fact or omit to state a material fact necessary to,make the statements therein, in light of the circumstances under which they were made, not misleading(provided,however,no such representation or warranty is made with respect to the information in the Final Official Statement relating to DTC, the book-entry system, the Financial Advisor or the Underwriter). Capitalized terms not defined herein shall have the meaning set forth in the Purchase Agreement. Dated this 2nd day of August, 2011. G Iwen Wang, Finance and ation Services Administrator City of Renton, Washington FEDERAL TAX CERTIFICATE I, the undersigned officer of the City of Renton, Washington (the "City"), make this certification for the benefit of all persons interested in the exclusion from gross income for federal income tax purposes of the interest to be paid on the City's Limited Tax General Obligation Bonds, Series 2011A (the"Bonds"), which are being issued in the aggregate principal amount of$16,715,000 and delivered simultaneously with the delivery of this certificate. I do hereby certify as follows in good faith on the date of issue of the Bonds: 1. Responsible Officer. I am the duly chosen, qualified and acting officer of the City for the office shown below my signature; as such, I am familiar with the facts herein certified and I am duly authorized to execute and deliver this certificate on behalf of the City. I am the officer of the City charged, along:with other officers of the City, with responsibility for issuing the Bonds. 2. Code and Regulations. The Bonds are subject to the provisions of sections 141, 148, 149 and 150 of the Internal Revenue Code of 1986, as amended (the "Code"), and the Treasury Regulations (the "Regulations") promulgated under sections 141, 148, 149 and 150 of •the Code. These provisions of the Code and Regulations impose restrictions on the use of bond- financed facilities and on the investment of bond proceeds. This certificate is being executed and delivered pursuant to sections 1.141-1 through 1.141-15, 1.148-0 through 1.148-11, 1.149(b)-1, 1.149(d)-1, 1.149(g)-1, 1.150-1 and 1.150-2 of the Regulations. 3. Definitions. The capitalized terms used in this certificate (unless otherwise defined) that are defined in Resolution No. 5613, adopted on June 20, 2011, authorizing the issuance of the Bonds (the "Bond Ordinance") shall for all purposes hereof have the meanings therein specified. All terms defined in the Code or Regulations shall for all purposes of this certificate have the same meanings as given to those terms in the Code and Regulations unless the context clearly requires otherwise. 4. Reasonable Expectations. The facts and estimates that are set forth in this certificate are accurate. The expectations that are set forth in this certificate are reasonable in light of such facts and estimates. There are no other facts or estimates that would materially change such expectations. The undersigned has to the extent necessary reviewed the certifications set forth herein with other representatives of the City as to such accuracy and reasonableness. The undersigned has also relied, to the extent appropriate, on representations set forth in the certificate of Seattle-Northwest Securities Corporation (the "Underwriter"), attached as Exhibit A to this certificate, and the certificate of Piper Jaffray & Co. (the "Financial Advisor"), attached as Exhibit B to this certificate. The undersigned is aware of no fact, estimate or circumstance that would create any doubt regarding the accuracy or reasonableness of all'or any portion of such documents. • 5. Description of Governmental Purpose. The City is issuing the Bonds pursuant-to the Bond Ordinance for the purposes of funding (a) the Project (hereinafter defined) as described more fully in the Official Statement prepared in connection with the offering of the Bonds and (b) the costs of issuance of the Bonds. The primary purpose of each transaction undertaken in connection with the issuance of the Bonds is a bona fide governmental purpose. The Project is described as follows: to acquire land for and construct, improve and equip new public library facilities, and to repair, renovate and improve existing libraries for other public uses (the "Proj ect"). 6. Amount and Expenditure of Sale Proceeds of the Bonds. (a) Amount of Sale Proceeds. The sale proceeds from the issuance of the Bonds are $18,120,552.65, based on the amount set forth on Exhibit A hereto. Such amount represents the stated redemption price at maturity of the Bonds of $16,715,000.00, less net original issue discount of$26,551.25 plus original issue premium of$1,432,103.90. No portion of the purchase price of any of the Bonds is provided by the issuance of any other obligations of the City or any other governmental entity. (b) Expenditure of Sale Proceeds. The sale proceeds of the Bonds will be expended as follows: (i) The,amount of$75,886.10 will be allocated on the date of issuance of the Bonds to the payment of Underwriter's discount or compensation. (ii) The amount of$40,857.50 will be disbursed to pay other issuance costs of the Bonds. (iii) The amount of $18,003,809.05 will be deposited in the Project Fund and is expected to,be disbursed to pay or reimburse the costs of acquisition and construction of the Project. The aggregate amount of the costs of acquisition and construction of the Project is anticipated to be not less than such amount. Any costs of the Project not financedout of original or investment proceeds of the Bonds will be financed out of the City's available funds. (c) Reimbursement. Other than to the extent of preliminary expenditures (i.e., architectural, engineering, surveying, soil testing, Bond issuance, and similar costs that are incurred prior to commencement of acquisition, construction, or rehabilitation of the Project, other than land acquisition, site preparation, and similar costs incident to commencement of construction) not in excess of 20% of the aggregate issue price of the Bonds, no portion of the amount described in paragraph 6(b) above will be disbursed to reimburse the City for any expenditures made by the City prior to the date that is 60 days before the earlier of the issue date or the date the City adopted a resolution (the "Declaration"), if any, describing the Project, stating the maximum principal amount of obligations expected to be issued for the Project, and stating the City's reasonable expectation on that date that it would reimburse expenditures for costs of the Project with proceeds of an obligation. The Declaration, if any, is not an official intent to reimburse that was declared as a matter of course, or in an amount substantially in excess of the amount expected to be necessary for the Project. The City has not engaged in a pattern of failure to reimburse original expenditures covered by declarations of official intent. Such reimbursed portion will be treated as spent for purposes of paragraphs 11 and 15 below on the date an allocation is made in writing that evidences the City's use of the proceeds for original expenditure (provided, however, that an allocation made within 30 days of the date of issue may be treated as made on the date of issue). -2- (d) No Working Capital. Except for an amount that does not exceed 5 percent of the sale proceeds of the Bonds (and that is directly related to capital expenditures financed by the Bonds),the City will only expend proceeds of the Bonds for(i) costs that would be chargeable to the capital accounts of the Project if the City's income were subject to federal income taxation and (ii) interest on the Bonds in an amount that does not cause the aggregate amount of interest paid on all of the Bonds to exceed that amount of interest on the Bonds that is attributable to the period that commences on the date hereof and ends on the later of(A) the date that is three years from the issue date of the Bonds or (B) the date that is one year after the date on which the Project is placed in service. (e) No Sale of Conduit Loan. No portion of the sale proceeds of the Bonds has been or will be used to acquire, finance, or refinance any conduit loan to any party. (f) No Overissuance. The proceeds of the Bonds will not exceed by more than a minor portion (as defined in paragraph 13 below) the amount necessary to accomplish _ the governmental purposes of the Bonds and, in fact, are not expected to exceed by any amount the amount of proceeds allocated to expenditures for the governmental purposes of the Bonds. (g) Allocations and Accounting. The proceeds of the Bonds will be allocated to expenditures not later than 18 months after the later of the date the expenditure is made or the date the Project is placed in service, but in no event later than the date that is 60 days after the fifth anniversary of the date hereof or the retirement of the last Bond, if earlier. The allocation of proceeds will be made by consistently employing the direct-tracing method of accounting. No proceeds of the Bonds will be allocated to any expenditure to which proceeds of any other obligations have heretofore been allocated. 7. Pre-Issuance Accrued Interest. The Bonds are dated as of the initial date of delivery to the Underwriter, and the City will receive no pre-issuance accrued interest on the Bonds. 8. Expenditure of Investment Proceeds. The best estimate of the City is that investment proceeds resulting from the investment of any proceeds of the Bonds pending expenditure of such proceeds for costs of the Project will be retained in the Project Fund and disbursed to pay or reimburse Project costs in addition to those described in paragraph 6 above. 9. No Replacement Proceeds. Other than amounts described in this certificate, there are no amounts that have a sufficiently direct nexus to the Bonds or to the governmental purposes 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 for that purpose. Specifically, (a) No Sinking Funds. Other than to the extent described in this certificate, there is no debt service fund, redemption fund, reserve fund, replacement fund, or similar fund reasonably expected to be used directly or indirectly to pay principal or interest on the Bonds. (b) No Pledged Funds. Other than amounts described in this certificate, there is no amount that is directly or indirectly pledged to pay principal or interest on the Bonds, or to a guarantor of part or all of the Bonds, such that such pledge provides reasonable assurance that such amount will be available to pay principal or interest on the Bonds if the City -3- encounters financial difficulty. For purposes of this certification, an amount is treated as so pledged if it is held under an agreement to maintain the amount at a particular level for the direct or indirect benefit of the holders or the guarantor of the Bonds. (c) No Other Replacement Proceeds. There are no other replacement proceeds allocable to the Bonds because the City reasonably expects that the term of the Bonds will not be longer than is reasonably necessary for the governmental purposes of the Bonds. Furthermore, if the term of the Bonds is longer than is reasonably necessary for the governmental purposes of the Bond, the City does not reasonably expect to have available amounts during the portion of such period that is longer than is reasonably necessary. The City reasonably expects that the Bonds would be issued to achieve the governmental purpose of the Bonds independent of any arbitrage benefit. The Bonds would have been issued if the interest on the Bonds were included in gross income (assuming that the hypothetical taxable interest rate would be the same as the actual tax-exempt interest rate). (d) Weighted:Average Economic Life. The weighted average maturity of the Bonds, which has been computed by the Underwriter, will not be greater than 120 percent of the weighted average estimated economic life of the portion of the Project financed determined in accordance with section 147(b) of the Code. Such weighted average estimated economic life is determined in 'accordance with the following assumptions: (i) the weighted average was determined by taking into account the respective cost of each of the assets financed by the Bonds; (ii) the reasonably expected economic life of an asset was determined as of the later of the date hereof or the date on which such asset is expected to be placed in service (i.e., available for use for the intended purposes of such asset); (iii) the economic lives used in making this determination are:not greater than the useful lives used for depreciation under section 167 of the Code prior to the enactment of the current system of depreciation in effect under section 168 of the Code (i.e., the "mid-point lives") under the asset depreciation range ("ADR") system of section 167(m) of the Code, as set forth in Revenue Procedure 83-35, 1983- 1 C.B. 745, where applicable, and the "guideline lives" under Revenue Procedure 62-21, 1962- 2 C.B. 418, in the case of structures; and (iv) land or any interest therein has not been taken into account in determining the average reasonably expected economic life of such Project, unless 25 percent or more of the net proceeds of the Bonds is to be used to finance land. 10. Yield on the Bonds. For the purposes of this certificate, the yield on the Bonds is the discount rate that, when used in computing the present value as of the issue date of the Bonds, 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 as of the issue date. For purposes of determining the yield on the Bonds, the issue price of the Bonds is the sum of the issue prices for each group of substantially identical Bonds, plus pre-issuance accrued interest. For each group of substantially identical Bonds, the issue price is the first price at which a substantial amount (i.e., ten percent) is sold to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters and wholesalers). The issue price is based upon the representations of the Underwriter set forth in Exhibit A hereto. No Underwriter's discount, issuance costs, or costs of carrying or repaying the Bonds is taken into account for purposes of computing the yield on the Bonds. -4- The yield with respect to the portion of the Bonds subject to optional redemption is computed by treating such Bonds as retired at the stated redemption price at the final maturity date because (a) the City has no present intention.to redeem prior to maturity the Bonds that are subject to optional redemption; (b) no Bond is subject to optional redemption at any time for a price less than the retirement price at final maturity plus accrued interest; (c) no Bond is subject to optional redemption within five years of the issue date of the Bonds; (d) no Bond subject to optional redemption is issued at:an issue price that exceeds the stated redemption price at maturity of such Bond by more than one-fourth of one percent multiplied by the product of the state redemption price at maturity of such Bond and the number of complete years to the first optional redemption date for such Bond; and (e) no Bond subject to optional redemption bears interest at a rate that increases during the term of the Bond. The yield on the Bonds, as calculated in the manner set forth above, is 2.536295 percent. 11. Temporary Periods and Yield Restriction. The City has incurred or will incur within six months of the date hereof a binding obligation to a third party which is not subject to any contingencies within the control of the City or a related party pursuant to which the City is obligated to expend at least five percent of the sale proceeds of the Bonds on the Project. The City reasonably expects that work on or acquisition of the Project will proceed with due diligence to completion and that the proceeds of the Bonds will be expended on the Project with reasonable dispatch. The City reasonably expects that 85 percent of the sale proceeds of the Bonds will have been expended on the Project prior to the date that is three years after the issue date. Accordingly,the City may invest the sale proceeds of the Bonds at an unrestricted yield for a three year temporary period. Any sale proceeds not expended prior to the date that is three years after the issue date, will be invested at a yield not"materially higher" than the yield on the Bonds, except as set forth in paragraph 13 below. The City reasonably expects that any amount derived from the investment of sale proceeds of the Bonds and from the investment of such investment income will not be commingled with substantial other receipts or revenues of the City and will be expended prior to the date that is three years after theissue date, or one year after receipt of such investment income, whichever is later. Accordingly, the City may invest such investment proceeds at an unrestricted yield. Any such investment proceeds not expended prior to such date will be invested at a yield not "materially higher" than the yield on the Bonds, except as set forth in paragraph 13 below. 12. Bond Fund. Pursuant to the Bond Ordinance, the City has created a debt service fund designated the "City of Renton Limited Tax General Obligation Bond Debt Service Fund, 2011" (i.e.,the Bond Fund) and the proceeds from all taxes levied,assessed and collected for and on account of the Bonds are to be deposited in such Fund. The City expects that taxes levied, assessed and collected for and on account of the Bonds will be sufficient each year to pay such debt service. All amounts deposited in the Bond Fund which will be depleted at least once each bond year, except for a reasonable carryover amount not in excess of the greater of the earnings on such portion of the Bond Fund for the immediately preceding bond year or one-twelfth of the- principal and interest payments on the Bonds for the immediately preceding bond year. Therefore, all amounts therein may be invested at an unrestricted yield. Any amounts held in the Bond Fund for longer than 13 months will be invested in obligations the yield on which is not in excess of the yield on the Bonds. -5- 13. Minor Portion. All gross proceeds will be invested in accordance with paragraphs 11 and 12 above. To the extent such amounts remain on hand following the periods set forth in paragraphs 11 and 12 above or exceed the limits set forth in paragraph 12 above, the City will invest such amounts at a restricted yield as set forth in such paragraphs; provided, however, that a portion of such amounts, not to exceed in the aggregate the lesser of$100,000 or five percent of the sale proceeds of the Bonds (the "Minor Portion"), may be invested at a yield which is higher than the yield on the Bonds. 14. Issue. There are no other obligations that (a) are sold at substantially the same • time as the Bonds (i.e., within 15 days), (b) are sold pursuant to the same plan of financing with the Bonds, and (c)'will be paid out!of substantially the same source of funds as the Bonds. 15. Compliance With Rebate Requirements. The City has covenanted in the Bond Ordinance that it will take all necessary steps to comply with the requirement that rebatable arbitrage earnings on the investment of the gross proceeds of the Bonds, if any, within the meaning of section 148(f) of the Code be rebated to the federal government. Specifically, the City.will (a) maintain records regarding the investment of the gross proceeds of the Bonds as may be required to calculate such rebatable arbitrage earnings separately from records of amounts on deposit in the funds and accounts of the City which are allocable to other bond issues of the City or moneys which do not represent gross proceeds of any bonds of the City, (b) calculate at such intervals as may be required by applicable Regulations, the amount of rebatable arbitrage earnings, if any, earned from the investment of the gross proceeds of the Bonds and (c)pay, not less often than every fifth anniversary date of the delivery of the Bonds and within 60 days following the fmal maturity of the Bonds, or on such other dates required or permitted by applicable Regulations, all amounts required to be rebated to the federal government. Further, the City 'will not indirectly pay any amount otherwise payable to the federal government pursuant to the foregoing requirements to any person other than the federal government by entering into any investment arrangement with respect to the gross proceeds of the Bonds that might result in:a reduction in the amount required to be paid to the federal government because such arrangement results in a smaller profit or a larger loss than would have resulted if the arrangement hada been at arm's-length and had the yield on the issue not been relevant to either party. 16. Not an Abusive Transaction. (a) General. No action taken in connection with the issuance of the Bonds will enable the City to (i) exploit, other than during an allowable temporary period, the difference between tax-exempt and taxable interest rates to obtain a material financial advantage (including as a result of an investment of any portion of the gross proceeds of the Bonds over any period of time, notwithstanding that, in the aggregate, the gross proceeds of the Bonds are not invested in higher yielding investments over the term of the Bonds), and(ii) issue more bonds, issue bonds earlier, or allow bonds to remain outstanding longer than is otherwise reasonably necessary to accomplish the governmental purposes of the Bonds. To the best of our knowledge, no actions have been taken in connection with the issuance of the Bonds other than actions that would have been taken to accomplish the governmental purposes of the Bonds if the interest on the Bonds,were not excludable from gross income for federal income tax -6- purposes (assuming the hypothetical taxable interest rate would be the same as the actual tax- exempt interest rate on the Bonds). (b) No Sinking Fund. No portion of the Bonds has a term that has been lengthened primarily for the purpose of creating a sinking fund or similar fund with respect to the Bonds. 17. No Arbitrage. On the basis of the foregoing facts, estimates and circumstances, it is expected that the gross proceeds'of the Bonds will not be used in a manner that would cause any of the Bonds to be an "arbitrage bond" within the meaning of section 148 of the Code and the Regulations. To the best of the knowledge and belief of the undersigned, there are no other facts, estimates or circumstances that would materially change such expectations. '18. No Private Use,Payments or Loan Financing. (a) General. ,The City reasonably expects, as of the date hereof, that no action or event during the entire stated term of the Bonds will cause either the "private business tests" or the "private loan financing test," as such terms are defined in the Regulations, to be met. Specifically, (i) No portion of the proceeds of the Bonds will be used in a trade or business of a nongovernmental person. For purposes of determining use, the City will apply rules set forth in applicable Regulations and Revenue Procedures promulgated by the Internal Revenue Service, including, among others, the following rules: (A) any activity carried on by a person other than a natural person or a state or local governmental unit will be treated as a trade or business of a nongovernmental person; (B) the use of all or any portion of the Project is treated as the direct use of proceeds; (C) a nongovernmental person will be treated as a private business user of proceeds of the Bonds as a result of ownership, actual or beneficial use pursuant to a lease, or a management or incentive;payment contract, or certain other arrangements such as a take- or-pay or other output-type contract; and (D) the private business use test is met if a nongovernmental person has special legal entitlements to use directly or indirectly the Project. (ii) The City has not taken and will not take any deliberate action that would cause or permit the use of any portion of the Project to change such that such portion will be deemed to be used in the trade or business of a nongovernmental person for so long as any of the Bonds remains outstanding (or until an opinion of nationally recognized bond counsel is received to the effect that such change in use will not adversely affect the excludability from gross income for federal income tax purposes of interest payable on the Bonds). For this purpose, any action within the control of the City is treated as a deliberate action. A deliberate action occurs on the date the City enters into a binding contract with a nongovernmental person for use of the Project that is not subject to any material contingencies. (iii) All payments of the debt service on the Bonds will be paid from and secured by a generally applicable tax. For this purpose, a generally applicable tax is -7- a tax (A) that is an enforced contribution exacted pursuant to legislative authority in the exercise of the taxing power that is imposed and collected for the purpose of raising revenue to be used for governmental purposes and (B) that has a uniform tax rate that is applied to all persons of the same classification in the appropriate jurisdiction using a generally applicable manner of determination and collection. No portion of the payment of the debt service on the Bonds will be directly or indirectly derived from payments (whether or not to the City or any related party) in respect of property, or borrowed money, used or to be used for a private business use. Furthermore, no portion of the payment of the debt service on the Bonds will be directly or indirectly secured,by any interest in property used or1to be used for a private business use or payments in respect of property used or to be used for a private business use. (iv) No portion of the proceeds of the Bonds will be directly or indirectly used to make or finance a loan to any person other than a state or local governmental unit. (b) Dispositions of Personal Property in the Ordinary Course. The City does not reasonably expect that it will sell or otherwise dispose of personal property components of the Project financed with the ponds other than in the ordinary course of an established governmental program that satisfies the following requirements: (i) The weighted average maturity of the portion of the Bonds financing personal property is not greater than 120 percent of the reasonably expected actual use of such personal property for governmental purposes; (ii) The reasonably expected fair market value of such personal property on the date of disposition will be not greater than 25 percent of its cost; (iii) Such personal property will no longer be suitable for its governmental purposes on the date of disposition; and (iv) The City is required to deposit amounts received from such disposition in a commingled fund with substantial tax or other governmental revenues and the City reasonably expects to spend such amounts on governmental programs within 6 months from the date df commingling. Furthermore, the City will not sell or otherwise dispose of all or any portion of the Project in circumstances in which the foregoing requirements are not satisfied unless it has received an opinion of nationally recognized bond counsel to the effect that such disposition will not adversely affect the treatment of interest on the Bonds as excludable from gross income for federal income tax purposes. (c) Other Agreements. The City will not enter into any agreement with any nongovernmental person regarding the use of all or any portion of the Project during the stated term of the Bonds unless such agreement will not adversely affect the treatment of interest on the Bonds as excludable from gross income for federal income tax purposes. -8- 19. .Weighted Average Maturity. The weighted average maturity of the Bonds set forth on Exhibit A attached to this certificate is the sum of the products of the issue price of each group of identical Bonds and the number of years to maturity (determined separately for each group of identical Bonds and taking into account mandatory redemptions), divided by the aggregate sale proceeds of the Bonds. 20. Federal Guarantee Prohibition. The Bonds are not"federally guaranteed" and the City will not cause or allow the Bonds to become "federally guaranteed". Unless otherwise excepted under section 149(b) of the Code, the Bonds will be considered federally guaranteed if: (a) The payment of principal or interest with respect to the Bonds is guaranteed(in whole or in part)by:the United States (or any agency or instrumentality thereof); (b) 5 percent or more of the proceeds of the Bonds are to be: (i) used in making loans the payment of principal or interest with respect to which are to be,guaranteed (in whole or in part) by the United States (or any agency or instrumentality thereof), or (ii) invested (directly or indirectly) in federally insured deposits or accounts; or (c) The paymeht of principal or interest on the Bonds is otherwise indirectly guaranteed(in whole or in part)by the United States (or an agency or instrumentality thereof). The Bonds shall not be treated as federally guaranteed by reason of(i) any guarantee by the Federal Housing Administration, the Department of Veterans Affairs, the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, or the Government National Mortgage Association,;(ii) any guarantee of student loans and any guarantee by the Student Loan Marketing Association to finance student loans, (iii) any guarantee by the Bonneville Power Authority pursuant to the Northwest Power Act as in effect on July 18, 1984, or(iv) any guarantee by a Federal home loan bank described in Code section 149(b)(3)(E) that is made.in connection with the original issuance of bonds during the period beginning on July 8, 2008 and ending on December 31, 2010(or a renewal or extension of a guarantee so made). The federal guarantee prohibition shall not apply to (i) proceeds of the issue invested for an initial temporary period until such proceeds are needed for the purpose for which such issue was issued, (ii) investments of a bona fide debt service fund, (iii) investments of a reasonably required reserve fund, (iv) investments in bonds issued by the United States Treasury, or (v) other investments permitted under Regulations. 21. Bonds are not Hedge Bonds. Not more than 50 percent of the proceeds of the Bonds will be invested in nonpurpose investments (as defined in section 148(f)(6)(A) of the Code) having a substantially guaranteed yield for four years or more within the meaning of section 149(g)(3)(A)(ii) of the Code. Further, the City reasonably expects that at least 85 percent of the spendable proceeds of the Bonds will be used to carry out the governmental purposes of the Bonds within the three-year period beginning on the date the Bonds are issued. -9- CITY OF RENTON,WASHINGTON By: = A Name: Iwe- • an. Title: Finance and Informatio f ervices Administrator Date: August 2, 2011 •• • • • • • • • -10- - EXHIBIT A CERTIFICATE OF UNDERWRITER Seattle-Northwest Securities Corporation has acted as underwriter in connection with the sale and delivery of the City of Renton, Washington (the "City") Limited Tax General Obligation Bonds, Series 2011A (the "Bonds"). I, the undersigned, hereby certify as follows on behalf of the Underwriter: 1. I am the duly chosen, qualified and acting officer of the Underwriter for the office shown below my signature; as such, I am familiar with the facts herein certified and I am duly authorized to execute and deliver this certificate on behalf of the Underwriter. I am the officer of the Underwriter charged, along with other officers of the Underwriter, with responsibility for the Bonds. • 2. The Underwriter has purchased the Bonds from the City pursuant to a Bond Purchase Contract dated July 28, 2011, for an aggregate purchase price of$18,044,666.55. The Underwriter has made a bona fide public offering to the public of all of the Bonds of each maturity at the issue prices to the public set on the cover of the Official Statement. The issue prices set forth in the Official Statement were determined on the date the Bonds were purchased by the Underwriter based on the reasonable expectations regarding the initial public offering prices. The issue price for each maturity of the Bonds represents the first price (including original issue premium and discount and accrued interest to the issue date only) of the Bonds at which a substantial amount (at least 10 percent) of each such maturity was sold to the public. The aggregate of such issue prices of all of the Bonds is $18,120,552.65. The initial public offering prices described above do not exceed the fair market value for the Bonds on the sale date. The term "public," as used herein, does not include bondhouses, brokers, dealers, and similar persons or organizations acting in the capacity of underwriters or wholesalers. 3. The yield on the ;Bonds is not less than 2.536295 percent. For purposes of this certificate, the term "yield" means that yield which is computed as described in paragraph 10 of the Federal Tax Certificate. 4. The Underwriter, computed the weighted average maturity of the Bonds to be 6.4393 years, as set forth in paragraph 19 of the Federal Tax Certificate to which this certificate is attached. - 5. To the best of my knowledge, which was acquired in the course of structuring the Bonds on behalf of the City, (i)the Bonds were not structured to take advantage of the difference between tax exempt and taxable rates except as identified in the Federal Tax Certificate with respect to permissible investments subject to arbitrage rebate, and (ii) the Bonds were not issued earlier, in a greater amount, with reserves or sinking funds larger,,or with a maturity longer than was reasonably necessary to finance the Project. The Underwriter hereby authorizes the City to rely on the statements made herein in connection with making the representations set forth in the Federal Tax Certificate to which this' certificate is attached and in its efforts to comply with the conditions imposed by the Code on the exclusion of interest on the Bonds from the gross income of their owners. The Underwriter A-1 hereby authorizes Pacifica Law Group LLP to rely on this certificate for purposes of its opinion regarding the treatment of interest on the Bonds as excludable from gross income for federal income tax purposes. Capitalized terms used herein and not otherwise defined have the meaning ascribed to such terms in the Federal Tax Certificate to which this certificate is attached. SEATTLE-NORTHWEST SECURITIES CORPORATION I i By: Title: Senior Vice President Date: August 2, 2011 • • A-2 • EXHIBIT B CERTIFICATE OF FINANCIAL ADVISOR I, the undersigned officer of the Financial Advisor, make this certificate for the benefit of all persons interested in the exclusion from gross income for federal income tax purposes of the interest on the Bonds. Each capitalized term used herein has the meaning specified for such term in the Federal Tax Certificate to which this Exhibit B is attached (the "Federal Tax Certificate"). I hereby certify as follows as of the Issue Date: 1. I am the duly chosen, qualified and acting officer of the Financial Advisor for the office shown below my signature;'as such, I am familiar with the facts herein certified and I am duly authorized to execute and deliver this certificate on behalf of the Financial Advisor. I am the officer of the Financial Advisor who has worked with representatives of the City in structuring the financial terms of the Bonds. 2. I have worked closely with representatives of the City in structuring the financial terms of the Bonds. To the best of my knowledge, which was acquired in the course of structuring the Bonds on behalf of the City, (i) the Bonds were not structured to take advantage of the difference between tax exempt and taxable rates except as identified in the Federal Tax Certificate with respect to permissible investments subject to arbitrage rebate, and (ii) the Bonds were not issued earlier, in a greater amount, with reserves or sinking funds larger, or with a maturity longer than was reasonably necessary to finance the Project. • The City may rely on the statements made herein in connection with making the representations set forth in theCertificate and in its efforts to comply with the conditions imposed by the Code on the exclusion of interest on the Bonds from the gross income of their owners. Pacifica Law Group LLP also may rely on this certificate for purposes,of its opinion regarding the treatment of interest on the Bonds as excludable from gross income for federal income tax purposes. • PIPER JAFFRAY& CO. • By: Name: Jane D. Towery Title: Managing Director Date: August 2, 2011 B-1 Fo.8038-6 Information Return for Tax-Exempt Governmental Obligations ► Under Internal Revenue Code section 149(e) OMB No.1545-0720 (Rev.May 2010) ► See separate instructions. Department of the Treasury Caution:If the issue price is under$100,000, use Form 8038-GC. ' Internal Revenue Service Part I Reporting Authority • ' If Amended Return, check here ► ❑ 1 Issuer's name 2 Issuer's employer identification number(EIN) City of Renton,Washington 91 6001271 3 Number and street(or P.O.box if mail is not delivered to street address) Room/suite 4 Report number(For IRS Use Only) 1055 South Grady Way . 13 r� ?:i-�"` ril 5 City,town,or post office,state,and ZIP code 6 Date of issue Renton,Washington 98055 August 2,2011 7 Name of issue 8 CUSIP number Limited Tax General Obligation Bonds,Series 2011A 760133SQ2 9 Name and title of officer of the issuer or other person whom the IRS may call for more information 10 Telephone number of officer or other person (wen Wang,Finance and Information Services Administrator ( 425 ) 430-6858 Part II Type of Issue (enter the issue price)See instructions and attach schedule 11 Education 11 12 Health and hospital 12 . 13 Transportation 13 14 Public safety 14 15 Environment(including sewage bonds) ! 15 16 Housing ! 16 17 Utilities 17 18 Other. Describe► Library facilities • 18 18,120,553 19 If obligations are TANs or RANs, checklonly box 19a 0- ❑ r 0, "VSs If obligations are BANs, check only box 19b ► RedtAI a ::r 20 If obligations are in the form of a lease ior installment sale, check box ► ❑ f Nr ' Part III Description of Obligations Complete for the entire issue for which this form is being filed. (a)Final maturity date (b)Issue(price (c)Stated redemption (d)Weighted (e)Yield price at maturity average maturity 21 12/01/2022 $ '18,120,553 $ 16,715,000 6.4393 years 2.5363 % Part IV Uses of Proceeds of Bond Issue (including underwriters' discount) 22 Proceeds used for accrued interest 22 0 23 Issue price of entire issue (enter amount from line 21, column.(b)) 23 18,120,553 24 Proceeds used for bond issuance costs(including underwriters'discount) . 24 116,744y" 25 Proceeds used for credit enhancement 25 0 • s,Y, , 26 Proceeds allocated to reasonably required reserve or replacement fund. 26 0 s�ce . �:. 27 Proceeds used to currently refund prior issues 27 0 s j R4 "g. 28 Proceeds used to advance refund prior issues , 28 0ac,. 29 Total (add lines 24 through 28) 29 116,744 30 Nonrefunding proceeds of the issue(subtract line 29 from line 23 and enter amount here) . 30 18,003,809 Part V 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. . . ► years 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 (MM/DD/YYYY) 0- 34 34 Enter the date(s)the refunded bonds were issued ►(MM/DD/YYY ) For Privacy Act and Paperwork Reduction Act Notice, see separate instructions. Cat.No.63773S Form 8038-G (Rev.5-2010) • Form 8038-G(Rev.5-2010) Page 2 Part VI Miscellaneous 35 Enter the amount of the state volume cap'allocated to the issue under section 141(b)(5) . . . 35 0 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract . :' (GIC)(see instructions) 36a 0 b Enter the final maturity date of the GIC - 37 Pooled financings: a Proceeds of this issue that are to be used to make loans to other g:?tom governmental units 37a 0 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)(III) (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 perjury,I declare that';have examined this return and accompanying schedules and statements,and to the best of my knowledge Signature and belief,they are true,correct,and comp':e.I further declare that I consent to the IRS's disclosure of the issuer's return information,as necessary and to process this return,to the p- •n t • ave authorized above. Consent "1: g/t/Zo 1 I Iwen Wang, Finance&Info.Svs.Dir. ' Signaer's autr red representativ• Date ' Type or print name and title Preparer's I Date Check if Preparer's SSN or PTIN Paid signature self-employed❑ Preparers EIN Firm's name(or Use Only yours if self-employed), • address,and ZIP code Phone no. ( Form 8038-G (Rev.5-2010) • • • • CERTIFICATE OF PAYMENT AND DELIVERY I, Iwen Wang, Finance and Information Services Administrator of the City of Renton, Washington (the "City"), do hereby certify that on this date the City delivered to Seattle- Northwest Securities Corporation, Seattle, Washington(the "Underwriter"), or its duly appointed agent, the City's Limited Tax General Obligation Bonds, Series 2011A, in the aggregate principal amount of $16,715,000 (the `Bonds"), in the form provided by No. 5613 passed on June 20, 2011. I further certify that at the time of such delivery, the City received payment for the Bonds, from the Underwriter, as follows: Source of Funds Principal Amount of Bonds $ 16,715,000.00 Plus: Net Original Issue Premium 1,405,552.65 Less: Underwriter's Discount (75,886.10) Less: POS/OS Printing and Mailing (750.00) Total Sources of Funds $ 18,043,916.55 Distribution of Funds To: City of Renton Deposit to Project Fund(including additional proceeds) $ 18,003,809.05 Costs of Issuance: 40,107.50 $ 18,043,916.55 • Total Funds Disbursed $ 18,043,916.55 Dated as of this 2nd day of August,2011. CITY OF RENTON, WASHINGTON By Iwen Wang Finance and Information Services Administrator • STATE OF WASHINGTON, COUNTY OF KING } • AFFIDAVIT OF PUBLICATION PUBLIC NOTICE Linda M Mills, being first duly sworn on oath that she is the Legal . CITY OF RENTON •Advertising Representative of the • NOTICE OF ORDINANCE . • ADOPTED BY THE RENTON CITY COUNCIL - Following is a summary of the ordinance adopted by the Renton . Renton Reporter City Council on June 20,2011: ORDINANCE NO.5613 . • An Ordinance of the City of Renton, Washington, providing • a weekly newspaper, which newspaper is a legal newspaper of for the issuance of Limited Tax General Obligation Bonds of the general circulation and is now and has been for more than six months • . City in the principal amount of prior to the date of publication hereinafter-referred.to,-published in not to _exceed $18,000,000 to . the English.language continuously as a weekly newspaper in King-- - - -.---- - - - - - finance all s or a portion of and costs of acquiring land for_and County, Washington. The Renton Reporter has been approved as constructing, improving. and • a Legal Newspaper by order of the Superior Court of the State of . equipping two new public library facilities and repairing, renovat- Washington for King County. ing and improving existing The notice in the exact form annexed was published in regular issues library facilities; providing the • of the Renton Reporter not in supplement form) which was form and termsthe of the bonds;and P (andPP delegating authority to regularly distributed to its subscribers during the below stated period. approve the final terms of the bonds. The annexed notice, a: • Effective: 7/24/2011 Public Notice Complete text of this ordinance •• is available at Renton City Hall, - 1055 South Grady Way; and posted at ty Libraries in the Renton,King 100CounMill was published on June 24, 2011. • Avenue South and 2902 NE 12th • • Street. Upon request to the City Clerk's office, (425) 430-6510, copies will also be mailed for a • • fee. The full amount of the fee charged for said foregoing publication is Bonnie I.Walton,City Clerk Published in the Renton Reporter the sum of $87.50. on June 24,2011.#501322. /id* 7 .,-.,\\.\\N"\‘‘11111 • 21 .2 -� , OALS�� liP / -:,---,;:<-, ..,N�i,,,„;-r V '`off Li/o I a M. Mills T--=,55` ►•9,'%, ,, Legal Advertising Representative,Renton Reporter . '`�^4-=0 ARS- ���,% Subscri o d and swo to me this 24th day of June, 2011. - = z . Kathy Dal .• , e tary Publidior t e State of Washington, Residing • in Coving .n,Washington w . P. O. Number: • J y ORDINANCE NO. 5613 CERTIFICATE I, the undersigned, City Clerk of the City Council of the City of Renton, Washington (the "City"), DO HEREBY CERTIFY: 1. That the attached Ordinance is a true and correct copy of Ordinance No. 5613 of the City Council (the "Ordinance"), duly passed at a regular meeting thereof held on the 20th day of June, 2011. 2. That said meeting was duly convened and held in all respects in accordance with law, and to the extent required by law, due and proper notice of such meeting was given; that a legal quorum was present throughout the meeting and a legally sufficient number of members of the City Council voted in the proper manner for the passage of the Ordinance;that all other requirements and proceedings incident to the proper passage of the Ordinance have been duly fulfilled, carried out and otherwise observed; and that I am authorized to execute this certificate. IN WITNESS WHEREOF, I have hereunto set my hand this 20th day of June, 2011. X 7vtt�c. - W ai{�QYL, Bonnie I. Walton, City Clerk E`ll $ • ;. 06121/1 1 STATE OF WASHINGTON, COUNTY OF KING } . AFFIDAVIT OF PUBLICATION . PUBLIC NOTICE Linda M Mills, being first duly sworn on oath that she is the Legal CITY OF RENTON Advertising Representative of the NOTICE PTED BY THE . RENTON CITY COUNCIL Following is a summary of the ordinance adopted by the Renton Renton Reporter City Council on June 20,2011: . ORDINANCE NO.5613 An Ordinance of the City of Renton, Washington, providing a weekly newspaper, which newspaper is a legal newspaper of for the issuance of Limited Tax " General Obligation Bonds of the _ general circulation and is now and has been for more than six months City in the.principal amount of prior to the date of publication hereinafter referred.to, published in not to exceed $18,000,000 to - finance all or a portion of the the English language continuously as a weekly newspaper in King - - - - - - costs of acquiring—land- for—and -_ County, Washington. The Renton Reporter has been approved as constructing, improving and a Legal Newspaper order of the Superior Court of the State of equipping two new public library by p facilities and repairing, renovat • - Washington for King County. ing and improving existing The notice in the exact form annexed was published in regular issues library facilities; providing the form and terms of the bonds;and of the Renton Reporter (and not in supplement form) which was delegating the authority to regularly distributed to its subscribers during the below stated period. . approve the final terms of the bonds. The annexed notice, a: Effective: 7/24/2011 Public Notice Complete text of this ordinance is available at Renton City Hall, 1055 South Grady Way; and posted at the King County was published on June 24, 2011. Avenue in Renton,n100NMill Avenue South and 2902 NE 12th Street. Upon request to the City • Clerk's office, (425) 430-6510, copies will also be mailed for a fee. The full amount of the fee charged for said foregoing publication is Bonnie I.Walton,City Clerk ®\‘\Vot\ Published in the Renton Reporter the sum of $87.50. `��� OALS op/g i on June 24,2011.#501322. �/' ,* k-�-, RAR. V,'-., Inda M. Mills =o _ . - -- z Legal Advertising Representative, Renton Reporter " •p �.0 =o Subsc 'b"d and swo o me this 24th dayof June, 2011. ', 0 iii- u� .., ,, „„,,,,,—A -/ C� __ 4 _ s<\ ' • II, // /!/,, O F NPS\. - Kathy Dais stary Public 1 the State of Washington, Residing ,,i,.\\.0,,,,•,,, in Covington,Washington P. O. Number: • • to ii . I • CITY OF RENTON, WASHINGTON LIMITED TAX GENERAL OBLIGATION BONDS, SERIES 2011A ORDINANCE NO. 5613 AN ORDINANCE OF THE CITY OF RENTON, WASHINGTON, PROVIDING FO,R THE ISSUANCE OF LIMITED TAX GENERAL OBLIGATION BONDS OF THE CITY IN THE PRINCIPAL AMOUNT OF NOT TO EXCEED $18,000,000 TO FINANCE ALL OR A PORTION OF THE COSTS OF' ACQUIRING LAND FOR AND CONSTRUCTING, IMPROVING AND EQUIPPING TWO NEW PUBLIC LIBRARY FACILITIES AND REPAIRING, RENOVATING AND IMPROVING EXISTING LIBRARY FACILITIES; PROVIDING THE FORM AND TERMS OF THE'BONDS; AND DELEGATING THE AUTHORITY TO APPROVE THE FINAL TERMS OF THE BONDS. PASSED: JUNE 20, 2011 PREPARED BY: PACIFICA LAW GROUP LLP Seattle, Washington • CITY OF RENTON ORDINANCE NO. 5613 TABLE OF CONTENTS* Page Section 1. Definitions and Interpretation of Terms 2 Section 2. Authorization of the Projects 7 Section 3. Authorization of Bonds and Bond Details 7 Section 4. Registration, Exchange and Payments 8 Section 5. Redemption Prior to Maturity and Purchase of Bonds 13 Section 6. Form of Bonds 17 Section 7. Execution of Bonds 19 Section 8. Application of Bond Proceeds 20 Section 9. Tax Covenants 21 Section 10. Bond Fund and Provision for Tax Levy Payments 23 Section 11. Defeasance 24 Section 12. Sale of Bonds 25 Section 13. Bond Insurance 27 Section 14. Undertaking to Provide Ongoing Disclosure 27 Section 15. Lost, Stolen or Destroyed Bonds 32 Section 16. Severability; Ratification 32 Section 17. Effective Date of Ordinance 33 * This Table of Contents is provided for convenience only and is not a part of this ordinance. -1- 06/21/11 CITY OF RENTON, WASHINGTON ORDINANCE NO. 5613 AN ORDINANCE OF THE CITY OF RENTON, WASHINGTON, PROVIDING FOR THE ISSUANCE OF LIMITED TAX GENERAL OBLIGATION BONDS OF THE CITY IN THE PRINCIPAL AMOUNT OF NOT TO EXCEED $18,000,000 TO FINANCE ALL OR A PORTION OF THE COSTS OF ACQUIRING LAND FOR AND CONSTRUCTING, IMPROVING AND EQUIPPING TWO NEW PUBLIC LIBRARY FACILITIES AND REPAIRING, RENOVATING AND IMPROVING EXISTING LIBRARY FACILITIES; PROVIDING THE FORM AND TERMS OF THEA BONDS; AND DELEGATING THE AUTHORITY TO APPROVE THE FINAL TERMS OF THE BONDS. WHEREAS, pursuant to Ordinance No. 5479 of the City Council (the "Council") of the City of Renton, Washington (the "City"), adopted on August 3, 2009, the City stated its intent to join the King County Library System ("KCLS") and called for an election to be held within the City on February 9, 2010; and WHEREAS, the number and proportion of the qualified electors required by law for the adoption thereof voted in favor of a proposition authorizing the annexation of the City into the KCLS; and WHEREAS, pursuant to the terms of an Interlocal Agreement between the City and KCLS, the City has agreed toacquireland, finance costs related to the construction of two public library facilities, and lease the land to KCLS, and KCLS has agreed to own, operate and maintain the public library facilities under the terms of a long-term lease agreement; and WHEREAS, the City desires to repair, renovate and improve existing library facilities for other public uses; and WHEREAS, it is hereby found to be in the best interest of the City to.provide financing for all or a portion of the costs of acquiring land for and constructing, improving and equipping ORDINANCE NO. 5613 two new public library facilities and to use the remaining funds, if available, for repairing, renovating and improving existing libraries for other public uses (the "Projects"); and WHEREAS, the City is authorized by chapters 35A.40 and 39.46 RCW to borrow money and issue general obligation bonds to finance the costs of the Projects; and WHEREAS, the City now desires to construct the Projects and issue and sell such Limited Tax General Obligation Bonds by negotiated sale to Seattle-Northwest Securities Corporation, Seattle, Washington in the principal amount of not to exceed $18,000,000 (the "Bonds") to finance costs of the Projects; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON DOES ORDAIN AS FOLLOWS: Section 1. Definitions and Interpretation of Terms. (a) Definitions. As used in this ordinance, the following words shall have the following meanings: Beneficial Owner means anyperson that has or shares the power, directly or indirectly to make investment decisions concerning ownership of any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries). Bond Fund means the "City of Renton Limited Tax General Obligation Bond Debt Service Fund, 2011" authorized to be created pursuant to Section 10 of this ordinance. Bond insurance Policy means the municipal bond insurance policy, if any, issued by the Insurer insuring the payment when due of the principal of and interest on the Bonds as provided therein. -2- 06/21/11 ORDINANCE NO. 5613 Bond Purchase Contract means the contract for the purchase of the Bonds between.the Underwriter and City, executed pursuant to Section 12 of this ordinance. Bond Register means' the registration books showing the name, address and tax identification number of each Registered Owner of the Bonds, maintained pursuant to Section 149(a) of the Code. ' Bond Registrar means; initially, the fiscal agency of the State of Washington, for the purposes of registering and authenticating the Bonds, maintaining the Bond Register, effecting transfer of ownership of the Bonds and paying interest on and principal of the Bonds. Bond Year means each one-year period that ends on the date 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 of the Bonds or the date that is five years after the date of issuance of the Bonds, Bond Years end on each anniversary of the date of issue and on the final maturity date of the Bonds. Bonds mean the City of Renton, Washington Limited Tax General Obligation Bonds, Series 2011A issued pursuant to this ordinance. City means the City of Renton, Washington, a municipal corporation duly organized and existing by virtue of the laws of the State of Washington. Code means the Internal Revenue Code of 1986, as amended, and shall include all applicable regulations and rulings relating thereto. Commission means the Securities and Exchange Commission. Council means the City Council as the general legislative authority of the City, as the same shall be duly and regularly constituted from time to time. -3- 06121/11 ORDINANCE NO. 5613 Designated Representative means the Mayor, the Chief Administrative Officer, or the Finance Director of the City, or any successor to the functions of such office. DTC means The Depository Trust Company, New York, New York, a limited purpose trust company organized under the laws of the State of New York, as depository for the Bonds pursuant to Section 4 of this ordinance. Federal Tax Certificate means the certificate executed by the Designated Representative setting forth the requirements of the Code for maintaining the tax exemption of interest on the bonds. Finance Director shall mean the City's Finance and Information Services Administrator or the successor to such officer. Government Obligations mean those obligations now or hereafter defined as such in chapter 39.53 RCW. Insurer means the municipal bond insurance company, if any, selected and designated by the Designated Representative, pursuant to Section 13 of this ordinance, or any successor thereto or assignee thereof, as issuer of a Bond Insurance Policy for all or a portion of the. Bonds. Letter of Representations means the blanket issuer letter of representations from the City to DTC. MSRB means the Municipal Securities Rulemaking Board or any successors to its functions. -4- 06121/11 J i ORDINANCE NO. 5613 Net Proceeds, when used with reference to the Bonds, mean the principal amount of the Bonds, plus accrued interest and original issue premium, if any, and less original issue discount, if any. Private Person means'any natural person engaged in a trade or business or any trust, estate, partnership, association, company or corporation. Private Person Use means the use of property in a trade or business by a Private Person if such use is other than as a member of the general public. Private Person Use includes ownership of the property by the Private Person as well as other arrangements that transfer to ,the Private Person the actual or beneficial use of the property (such as a lease, management or incentive payment contract or other special arrangement) in such a manner as to set the Private Person apart from the general public. Use of property as a member of the general public includes attendance by the Private Person at municipal meetings or business rental of property to the Private Person on a day-to-day basis if the rental paid by such Private Person is the same as the rental paid by any Private Person who desires to rent the property. Use of • property by nonprofit comm 'nity groups or community recreational groups is not treated as Private Person Use if such use;is incidental to the governmental uses of property, the property is made available for such use by all such community groups on an equal basis and such community groups are charged only a de minimis fee to cover custodial expenses. Project Fund means the "Library Construction Fund" as described in Section 8 of this • ordinance. Projects mean the capital projects described in Section 2 of this ordinance. -5- 06/21/11 ORDINANCE NO. 5613 Registered Owner means the person named as the registered owner of a Bond in the Bond Register. For so long as the Bonds are held in book-entry only form, DTC shall be deemed to be the sole Registered Owner. Rule means the Commission's Rule 15c2-12 under the Securities Exchange Act of 1934, as the same may be amended from time to time. Underwriter means Seattle-Northwest Securities Corporation, Seattle, Washington. (b) Interpretation. In this ordinance, unless the context otherwise requires: (1) The terms "hereby," "hereof," "hereto," "herein," "hereunder" and any similar terms, as used in this ordinance, refer to this ordinance as a whole and not to any particular article, section, subdivision or clause hereof, and the term "hereafter" shall mean after, and the term "heretofore" shall mean before, the date of this ordinance; (2) Words of the masculine gender shall mean and include correlative words of the feminine and neutral genders and words importing the singular number shall mean and include the plural number and vice versa; (3) Words importing persons shall include firms, associations, partnerships (including limited partnerships), trusts, corporations and other legal entities, including public bodies, as well as natural persons; (4) Any headings preceding the text of the several articles and sections of this ordinance, and any table of contents or marginal notes appended to copies hereof, shall be solely for convenience of reference and shall not constitute a part of this ordinance, nor shall they affect its meaning, construction or effect; and -6- 06/21/11 ORDINANCE NO. 5613 (5) All references herein to "articles," "sections" and other subdivisions or clauses are to the corresponding articles, sections, subdivisions or clauses hereof. Section 2. Authorisation of the Projects. The Bonds are being issued to finance all or a portion of the costs of acquiring land for and constructing, improving and equipping two new public library facilities and to use the remaining funds, if available, for repairing, renovating and improving existing libraries for other public uses (together,the "Projects"). Any remaining costs of the Projects shall be paid from other City funds legally available for such purposes. If the Council shall determine that it has become impractical to undertake or complete any portion of the Projects by reason of changed conditions, the City shall not be required to undertake or complete such portions of the Project. If the Projects have been completed or duly provided for, or found to be impractical, the Council may apply the Bond proceeds or any portion thereof to the redemption of the Bonds or to other capital purposes as the Council, in its discretion, shall determine. Section 3. Authorization of Bonds and Bond Details. For the purpose of paying the costs of the Projects and paying costs of issuance of the Bonds, including, but not limited to, the payment of the premium cost for a Bond Insurance Policy, if any, the City shall issue and sell its limited tax general obligation bonds in the aggregate principal amount of not to exceed $18,000,000 (the "Bonds"). The Bonds shall be general obligations of the City, shall be designated "City of Renton, Washington, Limited Tax General Obligation Bonds, Series 2011A"; shall be dated as of their date of delivery; shall be fully registered as to both principal and interest; shall be in the • -7- 06/21/11 ORDINANCE NO. 5613 denomination of $5,000 each, or any integral multiple thereof, provided that no Bond shall represent more than one maturity; shall be numbered separately in such manner and with any additional designation as the Bond Registrar deems necessary for purposes of identification; and shall bear interest from their date payable on the first days of each June and December, commencing on December 1, 2011, at rates set forth in the Bond Purchase Contract; and shall mature on the dates and in the principal amounts set forth in the Bond Purchase Contract and as approved by the Designated Representative pursuant to Section 12. The'Bonds of any of the maturities may be combined and issued as term bonds, subject to mandatory redemption as provided in the Bond Purchase Contract. Section 4. Registration, Exchange and Payments. (a) Bond Registrar/Bond Register. The City hereby specifies and adopts the system of registration approved by the Washington State Finance Committee from time to time through the appointment of state fiscal agencies. The City shall cause a bond register to be maintained by the Bond Registrar. So long as any Bonds remain outstanding, the Bond Registrar shall make all necessary provisions to permit the exchange or registration or transfer of Bonds at its principal corporate trust office. The Bond Registrar may be removed at any time at the option of the Finance Director upon prior notice to the Bond Registrar and a successor Bond Registrar appointed by the Finance Director. No resignation or removal of the Bond Registrar shall be effective until a successor shall have been appointed and until the successor Bond Registrar shall have accepted the duties of the Bond Registrar hereunder. The Bond Registrar is authorized, on behalf of the City, to authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of such Bonds and this ordinance and to carry out -8- 06121/11 • ORDINANCE NO. 5613 • all of the Bond Registrar's powers and duties under this ordinance. The Bond Registrar shall be responsible for-its representations contained in the Certificate of Authentication of the Bonds. (b) Registered Ownership. The City and the Bond Registrar, each in its discretion, may deem and treat the Registered Owner of each Bond as the absolute owner thereof for all purposes (except as provided in Section 14 of this ordinance), and neither the City nor the Bond Registrar shall be affected by any notice to the contrary. Payment of any such Bond shall be made only as described in Section 4(h) hereof, but such Bond may be transferred as herein provided. All such payments 'made as described in Section 4(h) shall be valid and shall satisfy and discharge the liability of the City upon such Bond to the extent of the amount or amounts - I I - so paid. (c) DTC Acceptance/Letters of Representations. The Bonds initially shall be held in fully immobilized form by DTC acting as depository. To induce DTC to accept the Bonds as eligible for deposit at DTC,the City has executed and delivered to DTC a Blanket Issuer Letter of Representations. Neither the City nor the Bond Registrar will have any responsibility or obligation to DTC participants'or the persons for whom they act as nominees (or any successor depository) with respect to the Bonds in respect of the accuracy of any records maintained by I - DTC (or any successor depository) or any DTC participant, the payment by DTC (or any successor depository) or any DTC participant of any amount in respect of the principal of or interest on Bonds, any notice which is permitted or required to be given to Registered Owners under this ordinance (except such notices as shall be required to be given by the City to the Bond Registrar or to DTC (or any successor depository)), or any consent given or other action taken by DTC (or any successor depository) as the Registered Owner. For so long as any Bonds -9- ° 03/21/11 ORDINANCE NO. 5613 are held in fully-immobilized form hereunder, DTC or its successor depository shall be deemed to be the Registered Owner for all purposes hereunder, and all references herein to the Registered Owners shall mean DTC (or any successor depository) or its nominee and shall not mean the owners of any beneficial interest in such Bonds. If any Bond shall be duly presented for payment and funds have not been duly provided by the City on such applicable date, then interest shall continue to accrue thereafter on the unpaid principal thereof at the rate stated on such Bond until it is paid. - (d) Use of Depository. (1) The Bonds shall be registered'initially in the name of "Cede &. Co.", as nominee of DTC, with one Bond maturing on each of the maturity dates for the Bonds in,a denomination corresponding to the total principal therein designated to mature on such date. Registered ownership of such immobilized Bonds, or any portions thereof, may not thereafter be transferred except (A)to any successor of DTC or its nominee, provided that any such successor shall be qualified under any applicable laws to provide the service proposed to be provided by it; (B)to any substitute depository appointed by the Finance Director pursuant to subsection (2) below or such substitute depository's successor; or(C)to any person as provided in subsection (4) below. (2) Upon the resignation of DTC or its successor (or any substitute depository or its successor) from its functions as depository or a determination by the Finance Director to discontinue the system of book entry transfers through DTC or its successor (or any substitute depository or its successor), the Finance Director may hereafter appoint a substitute a-10- 06/21/11 • ORDINANCE NO. 5613 depository. Any such substitute depository shall be qualified under any applicable laws to provide the services proposed to be provided by it. (3) In the case of any transfer pursuant to clause (A) or (B) of subsection (1) above, the Bond Registrar shall, upon receipt of all outstanding Bonds, together with a written request on behalf of the Finance Director, issue a single new Bond for each maturity then outstanding, registered in the name of such successor or such substitute depository, or their nominees, as the case may be; all as specified in such written request of the Finance Director. (4) In the event that (A) DTC or its successor (or substitute depository or its successor) resigns from its functions as depository, and no substitute depository can be obtained, or (B)the Finance Director determines that it is in the best interest of the beneficial owners of the Bonds that such owners be able to obtain such bonds in the form of Bond certificates, the ownership of such Bonds may then be transferred to any person or entity as herein provided, and shall not longer be held in fully-immobilized form. The Finance Director shall deliver a written request to the Bond,Registrar, together with a supply of definitive Bonds, to issue Bonds as herein provided in any authorized denomination. Upon receipt by the Bond Registrar of_all then outstanding Bonds together with a written request on behalf of the Finance Director to the Bond Registrar, new Bonds shall be issued in the appropriate denominations and registered in the names of such persons as are requested in such written i request. (e) Registration of Transfer of Ownership or Exchange; Change in Denominations. The transfer of any Bond may be registered and Bonds may be exchanged, but no transfer of any such Bond shall be valid unless it is surrendered to the Bond Registrar with the assignment -11- 06/21/11 ORDINANCE NO. 5613 form appearing on such Bond duly executed by the Registered Owner or such Registered Owner's duly authorized agent in a manner satisfactory to the Bond Registrar. Upon such surrender, the Bond Registrar shall cancel the surrendered Bond and shall authenticate and deliver, without charge to the Registered Owner or transferee therefor, a new Bond (or Bonds at the option of the new Registered Owner) of the sane date, maturity and interest rate and for the same aggregate principal amount in any authorized denomination, naming as Registered 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. Any Bond may be surrendered to the Bond Registrar and exchanged, without charge, for an equal aggregate principal amount of Bonds of the same date, maturity and interest rate, in any authorized denomination. The Bond Registrar shall not be obligated to register the transfer or to exchange any Bond during the 15 days preceding any interest payment or principal payment date any such Bond is to be redeemed. (f) Bond Registrar's Ownership of Bonds. The Bond Registrar may become the Registered Owner of any Bond with the same rights it would have if it were not the, Bond Registrar, and to the extent permitted by law, may act as depository for and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the right of the Registered Owners of Bonds. (g) Registration Covenant. The City covenants that, until all Bonds have been surrendered and canceled, it will maintain a system for recording the ownership of each Bond that complies with the provisions of Section 149 of the Code. -12- 05121/11 • ORDINANCE NO. 5613 (h) Place and Medium of Payment. Both principal of and interest on the Bonds shall be payable in lawful money of the United States of America. Interest on the Bonds shall be calculated on the basis of a year of 360 days and twelve 30-day months. For so long as all Bonds are in fully immobilized form, payments of principal and interest thereon shall be made as provided in accordance with the operational arrangements of DTC referred to in the Letter of Representations. In the event that the Bonds are no longer in fully immobilized form, interest on the Bonds shall be paid by check or draft mailed to the Registered Owners at the addresses for such Registered Owners appearing on the Bond Register on the fifteenth day of the month preceding the interest payment date, or upon the written request of a Registered Owner of more than $1,000,000 of Bonds (received by the Bond Registrar at least 15 days prior to the applicable payment date), such payment shall be made by the Bond Registrar by wire transfer to the account withinIthe United States designated by the Registered Owner. Principal of the Bonds shall be payable upon presentation and surrender of such Bonds by the Registered Owners at the principal office of the Bond Registrar. Section 5. Redemption Prior to Maturity and Purchase of Bonds. (a) Mandatory Redemption of Term Bonds and Optional Redemption, if any. The Bonds shall be subject to optional redemption on the dates, at the prices and under the terms set forth in the Bond Purchase Contract approved by the Designated Representative pursuant to Section 12 of this ordinance. The Bonds shall be subject to mandatory redemption to the extent, if any, set forth in the Bond Purchase Contract and as approved by the Designated Representative pursuant to Section 12 of this ordinance. -13- 06!21/11 ORDINANCE NO. 5613 (b) Purchase of Bonds. The City reserves the right to purchase any of the Bonds offered to it at any time at a price deemed reasonable by the Designated Representative. (c) Selection of Bonds for Redemption. For as long as the Bonds are held in book-entry only form, the selection of particular Bonds within a maturity to be redeemed shall be made in accordance with the operational arrangements then in effect at DTC. If the Bonds are no longer held in uncertificated form, the selection of such Bonds to be redeemed and the surrender and reissuance thereof, as applicable; shall be made as provided in the following provisions of this subsection (c). If the City redeems at any one time fewer than all of the Bonds having the same maturity date, the particular Bonds or portions of Bonds of such maturity to be redeemed shall be selected by lot (or in such manner determined by the Bond Registrar) in increments of $5,000. In the case of a Bond of a denomination greater than $5,000, the City and the Bond Registrar shall treat each Bond as representing such number of separate Bonds each of the denomination of $5,000 as is obtained by dividing the actual principal amount of such Bond by$5,000. In the event that only a portion of the principal sum of a Bond is redeemed, upon surrender of such Bond at the principal office of the Bond Registrar there shall be issued to the Registered Owner, without charge therefor, for the then unredeemed balance of the principal sum thereof, at the option of the Registered Owner, a Bond or Bonds of like maturity and interest rate in any of the denominations herein authorized. (d) Notice of Redemption. (1) Official Notice. For so long as the Bonds are held in uncertificated form, notice of redemption (which notice may be conditional) shall be given in accordance with the -14- 06/21/11 ORDINANCE NO.5613 operational arrangements of DTC as then in effect, and neither the City nor the Bond Registrar will provide any notice of redemption to any Beneficial Owners. Thereafter-(if the Bonds are no longer held in uncertificated form), notice of redemption shall be given in the manner hereinafter provided. Unless waived by any owner of Bonds to be redeemed, official notice of any such redemption (which redemption may be conditioned by the Bond Registrar on the receipt of sufficient funds for redemption or otherwise) shall be given by the Bond Registrar on behalf of the City by mailing a copy of an official redemption notice by first class mail at least 20 days and not more than 60 days prior to the date fixed for redemption to the Registered Owner of the Bond or Bonds to be redeemed at the address shown on the Register or at such other address as is furnished in writing by such Registered Owner to the Bond Registrar. All official notices of redemption shall be dated and shall state: (A) the redemption date, (B) the redemption price, (C) if fewer than all outstanding Bonds are to be redeemed, the identification by maturity (and, in the case of partial redemption, the respective principal amounts) of the Bonds to be redeemed, (D) that on the redemption date the redemption price will become due and payable upon each such Bond or portion thereof called for redemption, and that interest thereon shall cease to,accrue from and after said date, and (E) the place where such Bonds are to be surrendered for payment of the. redemption price, which place of payment shall be the principal office of the Bond Registrar. . -15- 06/21/11 ORDINANCE NO. 5613 . On or prior to any redemption date, the City shall deposit with the Bond Registrar an amount of money sufficient to pay the redemption price of all the Bonds or portions of Bonds which are to be redeemed on that date. (2) Effect of Notice; Bonds Due. If an unconditional notice of redemption has been given as aforesaid, the Bonds or portions of Bonds so to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date such Bonds or portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for redemption in accordance with said notice, such Bonds shallbe paid by the Bond Registrar at the redemption price. Installments of interest due on or prior to the redemption date shall be payable as herein provided for payment of interest. All Bonds which have been redeemed shall be canceled by the Bond Registrar and shall not be reissued. (3) Additional Notice. In addition to the foregoing notice, further notice shall be given by the City as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice shall in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above prescribed. Each further notice of redemption given hereunder shall contain the information required above for an official notice of redemption plus (A)the CUSIP numbers of all Bonds being redeemed; (B)the date of issue of the Bonds as originally issued; (C)the rate of interest borne by each Bond being redeemed; (D) the maturity date of each Bond being redeemed; and (E) any other descriptive information needed to identify accurately the Bonds being redeemed. Each further notice of redemption may be sent at least 20 days before the redemption date to'each party entitled to receive notice pursuant to Section 14 and to the Underwriter and with such additional information as -16- 06/21/11 r .� ORDINANCE NO. 5613 the City shall deem appropriate, but such mailings shall not be a condition precedent to the redemption of such Bonds. (4) Amendment of Notice Provisions. The foregoing notice provisions of this Section 5, including but not limited to the information to be included in redemption notices and the persons designated to receive notices, may be amended by additions, deletions and changes in order to maintain compliance with duly promulgated regulations and recommendations regarding notices of redemption of municipal securities. Section 6. Form of Bonds. The Bonds shall be in substantially the following form: [STATEMENT OF INSURANCE] UNITED STATES OF AMERICA NO. $ STATE OF WASHINGTON CITY OF RENTON LIMITED TAX GENERAL OBLIGATION BOND, SERIES 2011A INTEREST RATE: % MATURITY DATE: ,CUSIP NO.: REGISTERED OWNER: CEDE &CO. PRINCIPAL AMOUNT: The City of Renton, Washington (the "City"), hereby acknowledges itself to owe and for value received promises to pay to the Registered Owner identified above, or registered assigns, on the Maturity Date identified above, the Principal Amount indicated above and to pay interest thereon from , 2011, or the most recent date to which interest has been paid or duly provided for until payment of this bond at the Interest Rate set forth above, payable on December 1, 2011, and semiannually thereafter on the first days of each succeeding June and December. Both principal of and interest on this bond are payable in lawful money of the United States of America. The fiscal agency of the State of Washington has been appointed by the City as the authenticating agent, paying agent and registrar for the bonds of this issue (the "Bond Registrar"). For so long as the bonds of this issue are held in fully immobilized form, payments of principal and interest thereon shall be made as provided • -17- 06121/11 ORDINANCE NO. 5613 • in accordance with the operational arrangements of The Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter of Representations (the "Letter of Representations") from the City to DTC. The bonds of this issue are issued under and in accordance with the provisions of the Constitution and applicable statutes of the State of Washington and Ordinance No. duly passed by the City Council on June 20, 2011 (the "Bond Ordinance"). Capitalized terms used in this bond have the meanings given such terms in the Bond Ordinance. This bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Bond Ordinance until the Certificate of Authentication hereon shall have been manually signed by or on behalf of the Bond Registrar or its duly designated agent. This bond is one of an authorized issue of bonds of like date, tenor, rate of interest and date of maturity, except as to number and amount in the aggregate principal amount of $ and is issued pursuant to the Bond Ordinance to provide funds (a)to pay all o'r a portion of the cost of acquiring land for and constructing, improving and equipping two new public library facilities, and repairing, renovating and improving existing libraries for other public uses and. (b)to pay costs of issuance. The bonds of this issue are subject to redemption as provided in the Bond Ordinance and the Bond Purchase Contract. The City hereby irrevocably covenants and agrees with the owner of this bond that it will include in its annual budget and levy taxes annually, within and as a part of the tax levy permitted to the City without a vote of the electorate, upon all the property subject to taxation in amounts sufficient, together with other money legally available therefor, to pay the principal of and interest on this bond as the same shall become due. The full faith, credit and resources of the City are hereby irrevocably pledged for the annual levy and collection of such taxes and the prompt payment of such principal and interest. The bonds of this issue have not been designated by the City as "qualified tax-exempt obligations" for investment by financial institutions under Section 265(b) of the Code. The pledge of tax levies for payment of principal of and interest on the bonds may be discharged prior to maturity of the bonds by making provision for the payment thereof on the terms and conditions set forth in the Bond Ordinance. It is hereby certified that all acts, conditions and things required by the Constitution and statutes of the State of Washington to exist, 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 and the bonds of this issue does not violate any constitutional, statutory or other limitation upon the amount of bonded indebtedness that the City may incur. -18- 06/21/11 • ORDINANCE NO. 5613 IN WITNESS WHEREOF, the City of Renton, Washington has caused this bond to be executed by the manual or facsimile signatures of the Mayor and the City Clerk and the seal of the City imprinted, impressed or otherwise reproduced hereon as of this day of , 2011. [SEAL] CITY OF RENTON, WASHINGTON By Is!manual or facsimile Mayor ATTEST: /s/ manual or facsimile) City Clerk ' 1 The Bond Registrar's Certificate of Authentication on the Bonds shall be in substantially the following form: ;CERTIFICATE OF AUTHENTICATION This bond is one of the:bonds described in the within-mentioned Bond Ordinance and is one of the Limited Tax General Obligation Bonds, Series 2011A of the City of Renton, Washington, dated , 2011. WASHINGTON STATE FISCAL AGENCY, as Bond Registrar By Section 7. Execution of Bonds. The Bonds shall be executed on behalf of the City with the manual or facsimile signatures 9f the Mayor and City Clerk of the City and the seal of the City shall be impressed, imprinted or otherwise reproduced thereon. Only, such Bonds as shall bear thereon a Certificate of Authentication in the form hereinbefore recited, manually executed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of this ordinance. Such Certificate of Authentication -19- 06/21/11 ORDINANCE NO. 5613 • shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered hereunder and are entitled to the benefits of this ordinance. In case either of the officers who shall have executed the Bonds shall cease to be an . officer or officers of the City before the Bonds so signed shall have been authenticated or • delivered by the Bond Registrar, or issued by the City, such Bonds may nevertheless be authenticated, delivered and issued and upon such authentication, delivery and issuance, shall be as binding upon the City as though those who signed the same had continued to be such officers of the City. Any Bond may be signed and attested on behalf of the City by such persons who at the date of the actual execution of such Bond, are the proper officers of the City, although at the original date of such Bond any such person shall not have been such officer of the City. Section 8. Application of Bond Proceeds. The City shall establish a fund designated the "Library Construction Fund" (the "Project Fund") into which the proceeds of the Bonds (other than accrued interest, if any) shall be deposited. Money in the Project Fund shall be used to pay the costs of the Projects and costs of issuance of the Bonds. The Finance Director may invest money in the Project Fund in legal investments for City funds. Earnings on such investments shall accrue to the benefit of the Project Fund. Any part of the proceeds of the Bonds remaining in the Project Fund after all costs of the Projects have been paid (including costs of issuance) may be used for capital purposes of the City in accordance with the Federal Tax Certificate or may be transferred to the Bond .Fund, after consultation with bond counsel to the City. -20- 06/21/11 • ORDINANCE NO. 5613 ' Section 9. Tax Covenants. The City covenants that it will not take or permit to be taken on its behalf any action that would adversely affect the exemption from federal income taxation of the interest on t I e Bonds and will take or require to be taken such acts as may reasonably be within its abilit l and as may from time to time be required under applicable law to continue the exemption from federal income taxation of the interest on the Bonds. (a) Arbitrage Covenant. Without limiting the generality of the foregoing, the City I covenants that it will not take any action or fail to take any action with respect to the proceeds of the sale of the Bonds or anyother funds of the City which may be deemed to be proceeds of the Bonds pursuant to Section 148 of the Code and the regulations promulgated thereunder which, if such use had been reasonably expected on the dates of delivery of the Bonds to the initial purchasers thereof, would have caused the Bonds to be treated as "arbitrage bonds" within the meaning of such term as used in Section 148 of the Code. The City represents that it has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is an issuer whose arbitrage certifications may not be relied upon. The City will comply with the requirements of Section 148 of the Code and the applicable regulations thereunder throughout the term of the Bonds. (b) Private Person Use Limitation for Bonds. The City covenants that for as long as the Bonds are outstanding, it will not permit: (1) More than 10% of the Net Proceeds of the Bonds to be allocated to any Private Person Use; and (2) More than 10% of the principal or interest payments on the Bonds in a Bond Year to be directly or indirectly: (A) secured by any interest in property used or to be -21- 06/21/11 ORDINANCE NO. 5613 used for any Private Person Use or securedcby payments in'respect of property used or to be used for any Private Person Use, or (B) derived from payments (whether or not made to the City) in respect of property, or borrowed money, used or to be used for any Private Person Use. The City further covenants that, if: (3) More than five percent of the Net Proceeds of the Bonds are allocable to any Private Person Use; and (4) More than five percent of the principal or interest payments on the Bonds in a Bond Year are (under the terms of this ordinance or any underlying arrangement) directly or indirectly: (A) secured by any interest in property used or to be used for any Private Person Use or secured by payments in respect of property used or to be used for any Private Person Use, or (B) derived from payments (whether or not made to the City) in respect of property, or borrowed money, used or to be used for any Private Person Use, then, (i) any Private Person Use of the Projects described in subsection (3), hereof or Private Person Use payments described in subsection (4) hereof that is in excess of the five percent limitations described in such subsections (3) or (4) will be for a Private Person Use that is related to the state or local governmental use of the Projects funded by the proceeds of the Bonds, and (ii) any Private Person Use will not exceed the amount of Net Proceeds of the Bonds allocable to the state or local governmental,use portion of the Projects to which the Private Person Use of such portion of the Projects funded by the proceeds of the Bonds relate. The City further covenants that it will comply with any limitations on the use of the Projects funded by the -22- 06/21/11 J • ' _ ORDINANCE NO. 5613 proceeds of the Bonds by other than state and local governmental users that are necessary, in the opinion of its bond counsel, to preserve the tax exemption of the interest on the Bonds. The covenants of this section; are specified solely to assure the continued exemption from regular income taxation of the'interest on the Bonds. (c) Modification of Tax Covenants. The covenants of this section are specified solely to assure the continued exemption from regular income taxation of the interest on the Bonds. To that end, the provisions Of this section may be modified or eliminated without any requirement for formal amendment thereof upon receipt of an opinion of the City's bond counsel thatsuch modification! or elimination will not adversely affect the tax exemption of interest on any Bonds. (d) No Designation under Section 265(6). The City has not designated the Bonds as "qualified tax-exempt obligati ons" under Section 265(b)(3) of the Code for investment by financial institutions. Section 10. Bond Fund and Provision for Tax Levy Payments. The City hereby authorizes the creation of a fund to be used for the payment of debt service on the Bonds, designated as the "City of Renton Limited Tax General Obligation Bond Debt Service Fund, 2011" (the "Bond Fund"). No later than the date each payment of principal of and/or interest on the Bonds becomes due and payable, the City shall transmit sufficient funds, from the Bond Fund or from other legally available sources to the Bond Registrar for the payment of such principal and/or interest. Money,in the Bond Fund not needed to pay the interest or principal next coming due may be invested in legal investments for City funds. • ' -23- 06121/11 ORDINANCE NO. 5613 The City hereby irrevocably covenants and agrees for as long as any of the Bonds are outstanding and unpaid that each year it will include in its budget and levy an ad valorem tax upon all the property within the City subject to taxation in an amount that will be sufficient, together with all other revenues and money of the City legally available for such purposes, to pay the principal of and interest on the Bonds when due. The City hereby irrevocably pledges that the annual tax provided for herein to be levied for the payment of such principal and interest shall be within and as a _part of the tax levy permitted to cities without a vote of the people, and that a sufficient portion of each annual levy to be levied and collected by the City prior to the full payment of the principal of and interest on the Bonds will be and is hereby irrevocably set aside, pledged and appropriated for the payment of the principal of and interest on the Bonds. The full faith, credit and resources of the City are hereby irrevocably pledged for the annual levy and collection of said taxes and for the prompt payment of the principal of and interest on the Bonds when due. Section 11. Defeasance. In the event that the City, to effect the payment, retirement or redemption of any Bond, sets aside in the Bond Fund or in another special account, cash or noncallable Government Obligations, or any combination of cash and/or noncallable Government Obligations, ,in amounts and maturities which, together with the known earned income therefrom, are sufficient to redeem or pay and retire such Bond in accordance with its terms and to pay when due the interest and redemption premium, if any, thereon, and such cash and/or noncallable Government Obligations are irrevocably set aside and pledged for such purpose,then no further payments need be made into the Bond Fund for the payment of the principal of and interest on such Bond. The owner of a Bond so provided -24- 06/21/11 • ORDINANCE NO. 5613 for shall cease to be entitled to any lien, benefit or security of this ordinance except the right to receive payment of principal, premium, if any, and interest from the Bond Fund or such special account, and such Bond shall be deemed to be not outstanding under this ordinance. The City shall give written notice of defeasance to the owners of all Bonds so provided for within 30 days of the defeasance and to each party entitled to receive notice in accordance with Section 14 of this ordinance. Section 12. Sale of Bonds. (a) Bond Sale. The Bonds shall be sold at negotiated sale to, the Underwriter pursuant to the terms of the i Bond Purchase Contract. The Underwriter has advised the Council that market conditions are fluctuating and, as a result, the most favorable market conditions may occur on a day other than a regular meeting date of the Council. The Council has determined that it would be in the best interest of the City to delegate to the Designated Representative for a limited time the authority to approve the final interest rates, aggregate • principal amount, principal amounts of each maturity of the Bonds and redemption rights. The Designated Representative is hereby authorized to approve the final interest rates, aggregate principal amount, principal maturities and redemption rights for the Bonds in the manner provided hereafter so long as (a) the aggregate principal amount of the Bonds does not exceed $18,000,000, (b) the final maturity date for the Bonds is no later than December 1, 2031, (c) the, Bonds are 'sold (in the aggregate) at a price not less than 95% and not greater than 110%, and (d)the true interest cost for the Bonds (in the aggregate) does not exceed 4.00%. In determining whether or not to acquire a Bond Insurance Policy and determining the final interest rates, aggregate principal amounts, principal maturities and redemption rights, -25- 06/21/11 ORDINANCE NO. 5613 • the Designated Representative shall take into account those factors that, in his or her judgment, will result in the lowest true interest cost on the Bonds to their maturity, including, but not Limited to current financial market conditions and current interest rates for obligations comparable in tenor and quality to the Bonds. Subject to the terms and conditions set forth in this Section 12, the Designated Representative is hereby authorized to execute the Bond Purchase Contract. The signature of one of the listed Designated Representatives shall be sufficient. Following the execution of the Bond Purchase Contract, the Designated Representative or the Finance Director shall provide a report to the Council, describing the final terms of the Bonds approved pursuant to the authority delegated in this section. The authority granted to the Designated Representative by this Section 12 shall expire 120 days after the effective date of this ordinance. If a Bond Purchase Contract for the Bonds has not been executed within 120 days after the effective date of this ordinance, the authorization for the issuance of the Bonds shall be rescinded, and the Bonds shall not be issued nor their sale approved unless such Bonds shall have been re-authorized by ordinance of the Council. The ordinance re-authorizing the issuance and sale of such Bonds may be in the form of a new ordinance repealing this ordinance in whole or in part or may be in the form of an amendatory ordinance approving a bond purchase contract or establishing terms and conditions for the authority delegated under this Section 12. (b) Delivery of Bonds; Documentation. Upon the passage and. approval of this ordinance, the proper officials of the City including the Designated Representative, are authorized and directed to undertake all action necessary for the prompt execution and delivery of the Bonds to the Underwriter thereof and further to execute all closing certificates -26- 06/21/11 I ORDINANCE NO. 5613 and documents required to effect the closing and delivery of the Bonds in accordance with the terms.of the Bond Purchase Contract. (c) Preliminary an):1 Final Official Statements. The Finance Director is hereby authorized to ratify and to deem final the preliminary Official Statement relating to the Bonds for the purposes of the Rule: The Finance Director is further authorized to ratify and to approve for purposes of the Rule, on behalf of the City, the Official Statement relating to the issuance and sale of the Bonds and the distribution of the Official Statement pursuant'thereto with such changes, if any, as may be deemed by her to be appropriate. Section 13. Bond Insurance. The Finance Director is hereby further authorized to solicit proposals from municipal bond insurance companies for the issuance of a Bond Insurance Policy. In the event that the Finance Director receives multiple proposals, the Finance Director may select the proposal having the lowest cost and resulting in an overall 1 lower interest cost with respect to the Bonds. The Finance Director may execute a commitment received from the 'Insurer selected by the Finance Director. The Council further authorizes and directs all proper officers, agents, attorneys'and employees. of the City to cooperate with the Insurer in preparing such additional agreements, certificates, and other documentation on behalf of the City as shall be necessary or advisable in providing for the Bond Insurance Policy. Section 14. Undertaking to Provide Ongoing Disclosure. (a) Contract/Undertaking. This section constitutes the City's written undertaking for the benefit of the owners, 'including Beneficial Owners, of the Bonds as required by Section (b)(5) of the Rule. -27- 06/21/11 ORDINANCE NO. 5613 (b) Financial Statements/Operating Data. The City agrees to provide or cause to be provided to the Municipal Securities Rulemaking Board ("MSRB"), the following annual financial information and operating data for the prior fiscal year (commencing in 2011 for the fiscal year ended December 31, 2010): 1. Annual financial statements, which statements may or may not be audited, showing ending fund balances for the City's general fund prepared in accordance with the Budgeting Accounting and Reporting System prescribed by the Washington State Auditor pursuant to RCW 43.09.200 (or any successor statute) and generally of the type included in the official statement for the Bonds under the heading "General Fund Comparative Statement of Revenues, Expenditures and Changes in Fund Balance"; 2. The assessed valuation of taxable property in the City; 3. Ad valorem taxes due and percentage of taxes collected; 4. Property tax levy rate per$1,000 of assessed valuation; and 5. Outstanding general obligation debt of the City. Items 2-5 shall be required only to the extent that such information is not included in the annual financial statements. The information and data described above shall be provided on or before nine months after the end of the City's fiscal year. The City's current fiscal year ends December 31. The City may adjust such fiscal year by providing written notice of the change of fiscal year to the MSRB.. In lieu of providing such annual financial information and operating data, the City may cross-reference to other documents available to the public on the MSRB's internet website or filed with the Commission. -28- 0621/11 • ORDINANCE NO. 5613 �f If not provided as part of the annual financial information discussed above, the City shall provide the City's audited annual financial statement prepared in accordance with the • Budgeting Accounting and Reporting System prescribed by the Washington State Auditor pursuant to RCW 43.09.200 (or any successor statute) when and if available to the MSRB. (c) Listed Events. The City agrees to provide or cause to be provided to the MSRB, in a timely manner not in excess of ten business days after the occurrence of the event, notice of the occurrence of any of theifollowing events with respect to the Bonds: 1. Principal and interest payment delinquencies; 2. Non-payment related defaults, if material; 3. Unscheduled draws on debt service reserves reflecting financial 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, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; . 7. Modifications to the rights of Bondholders, if material; -29- 06/21/11 • ORDINANCE NO. 5613 • 8. Optional, contingent or unscheduled Bond calls other than scheduled sinking fund redemptions for which notice is given pursuant to Exchange Act Release 34-23856, if material, and tender offers; 9. Defeasances; 10. Release, substitution, or sale of property securing repayment of the Bonds, if material; 11. Rating changes; 12. Bankruptcy, insolvency, receivership or similar event of the City; 13. The consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and 14. Appointment of a successor or additional trustee or the change of name of a trustee, if material. The City shall promptly determine whether the events described above are material. (d) Format for Filings with the MSRB. All notices, financial information and operating data required by this undertaking to be provided to the MSRB must be in an electronic format as prescribed by the MSRB. All documents provided to the MSRB pursuant to this undertaking must be accompanied by identifying information as prescribed by the MSRB. -30- 06,21/11 ORDINANCE NO. 5613 (e) Notification Upon Failure to Provide Financial Data. The City agrees to provide or cause to be provided, in a timely manner, to the MSRB notice of its failure to provide the annual financial information described in Subsection (b) above on or prior to the date set forth in Subsection (b) above. (f) Termination/Modification. The City's obligations to provide annual financial information and notices of certain listed events shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. Any provision of this section shall be null and void if the City (1) obtains an opinion of nationally recognized bond counsel to the effect that the portion of the Rule that requires that provision is invalid, has been repealed retroactively or otherwise does not apply to the Bonds and (2) notifies the MSRB of such opinion and the cancellation of this section. The City may amend this section with an opinion of nationally recognized bond counsel in accordance with the Rule. In the event of any amendment of this section, the City shall describe such amendment in the next annual report, and shall include a narrative explanation of the reason for the amendment and its impact on the type (or in the case of a change of accounting principles,'on the'presentation) of financial information or operating data being presented by the City. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (A) notice of such change shall be given in the same manner as for a listed event under Subsection (c), and (B)the annual report for the year in which the change is made shall present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. -31- 05/21/11 ORDINANCE NO. 5613 1 (g) Bond Owner's Remedies Under This Section. The right of any bondowner or Beneficial Owner of Bonds to enforce the provisions of this section shall be limited to a right to obtain specific enforcement of the City's'obligations under this section, and any failure by the City to comply with the provisions of this undertaking shall not be an event of default with respect to the Bonds. (h) No Default. Except as otherwise disclosed in the City's official statement relating to the Bonds, the City is not and has not been in default in the performance of its obligations of any prior undertaking for ongoing disclosure with respect to its obligations. Section 15. Lost, Stolen or Destroyed Bonds. In case any Bond or Bonds shall be lost, stolen or destroyed, the Bond Registrar may execute and deliver a new Bond or Bonds of like date, number and tenor to the Registered Owner thereof upon the Registered Owner's paying the expenses and charges of the City and the Bond Registrar in connection therewith and upon his/her filing with the City evidence satisfactory to the City that such Bond was actually lost, stolen or destroyed and of his/her ownership thereof, and upon furnishing the City and/or the Bond Registrar with indemnity satisfactory to the City and the Bond Registrar. Section 16. Severability; Ratification. If any one or more of the covenants or agreements provided in this ordinance to be performed on the part of the City shall be declared by any court of competent jurisdiction to be contrary to law, then such covenant or covenants, agreement or agreements, shall be null and void and shall be deemed separable from the remaining covenants and agreements of this ordinance and shall in no way affect the validity of the other provisions of this ordinance or of the Bonds. All acts taken pursuant to the • -32- 06/21/11 • • ,ORDINANCE NO. 5613 authority granted in this ordinance but prior to its effective date are hereby ratified and confirmed. Section 17. Effective Date of Ordinance. This ordinance shall be effective upon its passage, approval, and thirty (30) days after publication. PASSED BY THE CITY COUNCIL this 20th day of June, 2011. J Bonnie I. Walton, City Clerk APPROVED BY THE MAYOR:this 20th day of June, 2011. \Denis Law, Mayor Approved as to form: De. na Gregory 0 • Pacifica Law Group LLP Bond Counsel Date of Publication: 6/24/2011 (summary) • Cr• s r �• . 1,:\iati r�4`•.FY;,'.: • A r."f.atAt+r ar -33- 06/17/11 June 20, 2011 Renton City Council Minutes Page 203 Library: Long-term Use of the Council President Briere presented a Committee of the Whole report Existing Downtown Library recommending that the existing downtown library building be maintained in Building public ownership and open to the public in perpetuity. As the Administration explores new uses in conjunction with the community, it should not consider those that would do anything other than enhance enjoyment of the building as a civic amenity and of the Cedar River. MOVED BY BRIERE, SECONDED BY PARKER, COUNCIL CONCUR IN THE COMMITTEE REPORT.* Responding to Councilmember Zwicker's inquiry,Senior Assistant City Attorney Fontes clarified that Council does not have the authority to bind a future Council. She affirmed that the report is essentially a statement of intent. *MOTION CARRIED. Finance Finance Committee Chair Persson presented a report recommending approval Finance:Vouchers of Claim Vouchers 303706-304087 totaling$3,221,897.34. MOVED BY PERSSON,SECONDED BY TAYLOR,COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. RESOLUTIONS AND The following resolution was presented for reading and adoption: ORDINANCES RESOLUTION#4099 A resolution was read authorizing the Mayor and City Clerk to enter into an Library: Interlocal Agreement interlocal agreement with the King County Library System related to the with KCLS construction of two King County Library System libraries in the City of Renton. MOVED BY BRIERE,SECONDED BY PARKER, COUNCIL ADOPT THE RESOLUTION AS READ.* At the request of Mayor Law, ROLL CALL was called: FOUR AYES: BRIERE, ZWICKER, PERSSON, PARKER;THREE NOES:TAYLOR, CORMAN, PALMER. *MOTION CARRIED. The following ordinance was presented for second and final reading: ORDINANCE#5613 An ordinance was read providing for the issuance of Limited Tax General Library: Limited Tax Obligation Obligation (LTGO) Bonds of the City in the principle amount of not to exceed Bonds $18 million to finance all ora portion of the costs of acquiring land for and constructing, improving, and equipping two new public library facilities and 6(t repairing, renovating and improving existing library facilities; providing the form (`��► and terms of the bond; and delegating the authority to approve the final terms of the bonds. MOVED BY BRIERE, SECONDED BY PARKER, COUNCIL ADOPT THE ORDINANCE AS READ.* ROLL CALL. FOUR AYES: BRIERE,ZWICKER, PERSSON, PARKER;THREE NOES: TAYLOR, CORMAN, PALMER. *MOTION CARRIED. NEW BUSINESS MOVED BY TAYLOR,SECONDED BY PALMER, COUNCIL REFER THE EMAIL Citizen Comment: Witt-Cedar CORRESPONDENCE RECEIVED FROM PAUL WITT REGARDING TRAIL SAFETY TO River Trail Safety THE PUBLIC SAFETY COMMITTEE. CARRIED. June 20, 2011 Renton City Council Minutes Page 202 Mayor Law asked Mr. Chan to follow the procedures written in the letter he received and to express his concerns in writing to the City's Development Services Division. CONSENT AGENDA Items listed on the consent agenda are adopted by one motion which follows the listing. Council: Meeting Minutes of Approval of Council meeting minutes of 6/6/2011 and 6/13/2011. Council 6/6/2011&6/13/2011 concur. Appointment:Airport Advisory Mayor Law reappointed Mark Hancock to the Airport Advisory Committee Committee (Kennydale,alternate position)for a term expiring on 5/7/2014. Council concur. Community Services: High Community Services Department recommended approval of a golf course fee School Golf Teams, Fee Waiver waiver in the amount of$11,600 for the Renton, Hazen, Lindbergh, and Liberty Request High Schools' 2011 golf season. Refer to Finance Committee. CAG: 10-054,West Hill Utility Systems Division submitted.CAG-10-054, West Hill Reservoir Recoat& Reservoir Recoat& Upgrade Upgrade 2010, and requested approval of the project,final pay estimate in the 2010, Coating Unlimited amount of$7,845.68, commencement of a 60-day lien period, and release of retained amount of$18,331.76 to Coating Unlimited, Inc., contractor, if all required releases are obtained. Council concur. MOVED BY BRIERE, SECONDED BY PARKER,COUNCIL APPROVE THE CONSENT AGENDA AS PRESENTED. CARRIED. UNFINISHED BUSINESS Council President Briere presented a Committee of the Whole report Committee of the Whole recommending concurrence in the staff recommendation to approve the Library: Interlocal Agreement following actions related to construction of two new libraries in the City of with KCLS& Library Facilities Renton: Development Limited Tax 1. Approve an Interlocal Agreement(ILA)with the King County Library System General Obligation Bonds and adopt the resolution; and 2. Present the ordinance for second and final reading and adoption to authorize issuance of up to$18 million in Limited Tax General Obligation (LTGO) bonds. First reading of this ordinance occurred on 5/9/2011. MOVED BY BRIERE, SECONDED BY PARKER,COUNCIL CONCUR IN THE COMMITTEE REPORT.* Councilmember Taylor urged Council to take more time to gather additional information and public input regarding this matter before moving forward. He stated that this decision will impact the community for decades. Councilmember Corman agreed with Mr.Taylor. ROLL CALL: FOUR AYES: BRIERE,ZWICKER, PERSSON, PARKER;THREE NOES: • TAYLOR, CORMAN, PALMER. *MOTION CARRIED. (See page 203 for resolution and ordinance.) APPROVED BY COMMITTEE OF.THE WHOLE CITY COUN IL - COMMITTEE REPORT. Date 4 d0• June 20, 2011 Interlocal Agreement with the King County Library System •, (Referred 4/25/2011) ' • and 2nd Reading of the-2011 Limited Tax General Obligation Bond Ordinance ' (Referred 5/16/2011) • The Committee•of the Whole recommends concurrence in the staff,recommendation to• approve the following actions related to construction of two new libraries in the City of • Renton: 1.) Approve an Interlocal Agreement (ILA) with the King.County Library System and adopt the Resolution; and• 2.) Present the ordinance for second and final reading.and adoption to'authorize issuance. • • of up to $18 million in Limited Tax General Obligation bond's. First reading of this • ordinance.occurred on May 9, 2011. j(444: - Terri Briere, C air • - cc: Peter Renner,Facilities Director May 9, 2011 Renton City Council Minutes Page 152 Human Resources: Human Finance Committee Chair Persson presented a report recommending Resources Manager Hire at concurrence in the staff recommendation to hire a new Human Resources Step E Manager, Cathryn Laird,at the "E"step of the M30 salary grade based on professional experience and background. No additional funding will be required in the 2011 budget. MOVED BY PERSSON,SECONDED BY TAYLOR, COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. RESOLUTIONS AND The following resolutions were presented for reading and adoption: ORDINANCES RESOLUTION#4093 A resolution was read waiving the admissions tax for the Seattle International CED:Admissions Tax Waiver, Film Festival. MOVED BY BRIERE,SECONDED BY PARKER, COUNCIL ADOPT THE Seattle International Film RESOLUTION AS READ. CARRIED. Festival The following ordinances were presented for first reading and referred to the 5/16/2011 Council meeting for second and final reading and adoption: Finance: Water Bill Leak An ordinance was read amending Section 8-4-46 of Chapter 4,Water,and Adjustment, Code Section 8-5-23 of Chapter 5,Sewers,of Title VIII (Health and Sanitation),of City Amendment Code, by modifying certain provisions that allow for billing adjustments for water leaks. MOVED BY PERSSON,SECONDED BY TAYLOR, COUNCIL REFER THE ORDINANCE FOR SECOND AND FINAL READING ON 5/16/2011. CARRIED. Finance: Libraries An ordinance was read providing for the issuance of Limited Tax General Development Limited Tax Obligation bonds of the City in the principal amount of not to exceed General Obligation (LTGO) $18,000,000 to finance all or a portion of the costs of repairing, renovating, and Bonds improving existing library facilities and acquiring land for and constructing, improving and equipping two new public library facilities; providing the form lQ and terms of the bonds; and delegating the authority to approve the final terms of the bonds. MOVED BY PERSSON, SECONDED BY BRIERE, COUNCIL REFER THE Z I 06 ORDINANCE FOR SECOND AND FINAL READING ON 5/16/2011.* I� Councilmember Taylor clarified that the ordinance was amended to allow flexibility in the language in case the location of the proposed library was changed at some point in the future. Councilmember Zwicker stated that he believes the decision regarding the location of new libraries had been made weeks ago. He also stated that the new interlocal agreement with KCLS is scheduled to appear before Council prior to second and final reading of this ordinance, and if the determination on the library site has not been made at the time the interlocal agreement is approved, he would vote against the ordinance. He reiterated that he believes approving this ordinance is essentially writing a blank check if a firm decision on the library location has not been made. *MOTION CARRIED. NEW BUSINESS Referring to prior audience comment, Councilmember Taylor stated for the CED:Sunset Area Planned record that he has met with members of the Renton Housing Authority Action regarding the redevelopment of the Sunset Terrace neighborhood. • May 9, 2011 Renton City Council Minutes Page 151 UNFINISHED BUSINESS Finance Committee Chair Persson presented a report recommending Finance Committee concurrence in the staff recommendation to amend City Code by modifying Finance: Water Bill Leak certain provisions that allow for billing adjustments for water leaks. The Adjustment, Code Committee further recommended that the ordinance regarding this matter be Amendment presented for first reading. MOVED BY PERSSON,SECONDED BY TAYLOR, COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. (See page 152 for ordinance.) Finance: Libraries Finance Committee Chair Persson presented a report recommending Development Limited Tax concurrence in the staff recommendation to approve the proposed financing General Obligation (LTGO) structure by issuing up to$18 million in Limited Tax General Obligation (LTGO) Bonds bonds,with final maturity in 2022. The Committee further recommended that ff the ordinance regarding this matter be presented for first reading. MOVED BY t\e PERSSON, SECONDED BY TAYLOR, COUNCIL CONCUR IN THE COMMITTEE 1) REPORT.* Councilmember Persson remarked that he believes it is best to get the bond started in order to achieve the most optimal interest rate. He also stated that the Committee changed the staff recommendation in order to allow the flexibility that Councilmember Taylor and other Councilmembers requested. Mr. Persson remarked that holding off on issuing the bond could cost the City over$1 million dollars. Councilmember Zwicker remarked that he believes the ordinance is vague and is essentially writing a blank check, but is willing to move it forward because it is not being adopted at tonight's meeting. *MOTION CARRIED. (See page 152 for ordinance.) Community Services: City Finance Committee Chair Persson presented a report recommending Center Parking Garage Fee concurrence in the staff recommendation to approve the City Center Parking Waivers Garage fee waivers for 2011 and 2012 for event volunteers in the total amount of$12,400, including$2,400 for Piazza Renton events,$9,520 for the Renton Farmers Market events,and $480 for the Return to Renton Benefit Car Show events. MOVED BY PERSSON,SECONDED BY TAYLOR, COUNCIL CONCUR IN THE AMENDED COMMITTEE REPORT.* The Committee report was amended to read as plural for each event. *MOTION CARRIED. Lease: Liberty Park Finance Committee Chair Persson presented a report recommending Community Center, Birthday concurrence in the staff recommendation to approve a two-year full-service Dreams lease with Birthday Dreams, a non-profit corporation,for Suite 200 at the Liberty Park Community Building. This lease will provide the City with$7,200 of revenue annually. The Committee further recommended that the Mayor and City Clerk be authorized to sign the lease agreement. MOVED BY PERSSON, SECONDED BY PARKER, COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. Councilmember Taylor recused himself from the vote. L ` - • • APPROVED BY CITY COUNCIL , FINANCE COMMITTEE ' • • • ' '- - ;.COMMITTEE REPORT ' - . - • . May 9,2011 - 2011 Limited Tax General Obligation (LTGO) Bonds for Proposed New Library Development , (Referred May 2, 201i) . • The Finance Committee recommends concurrence in the staff recommendation to approve the • proposed financing structure by issuing up to:$18 million in LTGO bonds, with final maturity in: 2022. The Committee further.recommends the .�+zrteelted ordinance be; presented for first - reading on May 9, 2011 and second'reading/adoption on May 16, 2011... . • 1/62A. __c?.C-4-4;(23—) Don Persson, Chair Greg-Ta... Viee Chair - - -�- - - r . . King rker, Member - May 2, 2011 Renton City Council Minutes Page 139 He remarked that a 14 year old boy was shot there, and that the security guard • who used to work hard at keeping the area safe is no longer employed there. Mr.Toms pointed out that people are not allowed in the Kent Rail Station until five minutes before their busses arrive. He requested that the City work on the quality of life in the downtown area before investing in new buildings there. He also expressed displeasure with the amount of, and wait-times for materials at KCLS libraries. Citizen Comment: Gerneglia - Caroline Gerneglia (Renton) stated that she loves the location of the downtown Relocation of the Downtown library. She remarked that she has brought her children there to play in the Library park,watch skateboarders,and walk along the river. She expressed opposition to the proposed location for the new library, and asked how safe it will be for a mother to tote books and children from the parking garage across the Transit Center area. Ms.Gerneglia stated that citizens cannot afford new taxes, and she believes the money would be better spent upgrading the current library. Citizen Comment: Bishai- Lily Bishai(Renton)shared her experiences of bringing her daughter to story- Relocation of the Downtown time at the current downtown library starting 15 years ago. She asked whether Library or not the Highlands library could be used while the downtown library was remodeled. Shestated that the price of relocating the library to the Transit Center area is too high for families and children, and that the current location is priceless. Ms. Bishai asked Council to consider the library's unique history and location. CONSENT AGENDA Items listed on the consent agenda are adopted by one motion which follows the listing. Council Meeting Minutes of Approval of regular City Council meeting minutes of 4/25/2011. Council 4/25/2011 concur. Annexation:Tess, SE 132nd & City Clerk reported receipt of 60% Petition to Annex for the Tess Annexation, 164th Ave SE approximately 16.3 acres located in the vicinity of SE 132nd St. and 164th Ave. SE. Information. Finance: Library Development Finance and Information Technology Department requested approval of the Limited Term General financial plan, and authorization to set 5/9/2011 as the date for first reading of Obligation (LTGO) Bonds an ordinance regarding new library development limited tax general obligation !Jo <« (LTGO) bonds. Refer to Finance Committee. Finance: Utility Bill Leak Finance and Information Technology Department recommended approval of a Adjustment;Code City Code amendment clarifying utility bill leak adjustment regulations. Refer Amendment to Finance Committee. Fire:Amateur Radio Fire and Emergency Services Department recommended approval of a Equipment Maintenance, KC Memorandum of Understanding with King County Fire District 20 regarding Fire District 20 maintenance and care of amateur radio equipment. Council concur. (See page 140 for resolution.) Human Resources: HR Human Resources and Risk Management Department recommended approval Manager Hire at Step E to hire the Human Resources Manager at Grade M30,Step E of the salary range. Refer to Finance Committee. Human Resources:2011 Human Resources and Risk Management Department recommended approval Medical Coverage, Group. of the 2011 Group Health Cooperative medical coverage contracts for LEOFF I Health Cooperative retirees and all active employees. Council concur. CITY OF RENTON COUNCIL AGENDA BILL Subject/Title: Meeting: Proposed New Library Development Bonds Regular Council - 02 May 2011 (LTGO) • Exhibits: Submitting Data: Dept/Div/Board: Issue Paper Finance & Information Technology • Ordinance i Renton LTGO 2011 POS Comments Staff Contact: Iwen Wang,Administrator Recommended Action: Refer to Finance Committee Fiscal Impact: Expenditure Required: $ Transfer Amendment: $ Amount Budgeted: $ Revenue Generated: $ Total Project Budget: $ I City Share Total Project: $ SUMMARY OF ACTION: The City and King County Library System have begun the planning process for the development of two new libraries to replace the existing City library facilities. The proposed financing plan and associated ordinance would authorize the issuance of up to $18 million in general obligation bonds;together with dedicated library resources available in the 2011-2012 budget for a combined funding of $19.8 million for the project. • STAFF RECOMMENDATION: Approve the proposed financing plan and present the ordinance for first reading on May 9th. City Flr p QnoftA0n, INFORMA GY MEMORANDUM 0 DATE: April 11, 2011 TO: Terri Briere, Council President Members of the Renton City Council VIA: Denis Law, Mayor FROM: Iwen Wang, FIT Administrator SUBJECT: Proposed 2011 LTGO for Library Development ISSUE • Should the City issue up to $18 million in Limited Tax General Obligation (LTGO) Bonds for the development of the new libraries? RECOMMENDATION Staff recommends approval of the proposed financing plan and adoption of the necessary ordinance authorizing the issuance of approximately $18 million. of bonds, at an "all-in" true interest cost of approximately 3.5%,with a final maturity in 2022 to finance the development of the two new libraries. • BACKGROUND In the Library Master Plan there was recognition that the City's existing library facilities are both • in need of major overhaul/redevelopment. As part of the annexation to the King County Library System (KCLS), the City agreed to use the resources dedicated for library purposes to build two new libraries in Renton. The City and KCLS have now begun the planning process for the development of the two new libraries. The proposed financing is to implement this project. The preliminary financing plan as included in the adopted budget for 2011-2012 contemplated issuing the bonds in two phases, first in late 2011 when the schematic design is complete, and the reminder in late 2012 when the cost can be ascertained. This approach would allow the City to accumulate more cash in hand prior to the bonds that were issued and keep the life of the bonds to 10 years, with maturity in 2022. The combined resources projected to generate $19.7 million in project funds, without considering the interest earning from the bond proceeds. Due to the increased market uncertainty and the outlook of inflation and interest rates, staff consulted with the underwriter and financial advisors, we believe it is advisable for the City to issue the bonds sooner than later. Each 0.5%of rate hike would reduce the amount that can be raised for the project by around$500,000. Based on the current market condition, the proposed bonds will carry an "all-in" (include all issue costs) true interest cost of around 3.5%; with a normal annual debt service payment at around $2 million a year, and final maturity in 2022. The bonds with maturity after 2021 may be called anytime after June 1, 2021. Terri Briere,Council President Members of the Renton City Council .Page2of2 • April 11,2011 • CONCLUSION ' Staff recommends the Council approve the financing plan and all the associated documents necessary to issue the bonds. Attachments: 1. Financing Summary • 2. Draft Bond Ordinance • CC: Jay Covington,CAO Marty Wine,Assistant CAO Gina Jarvis,Fiscal Services Director • • • • • • • 1 • Attachment 1: Financing Summary BOND SUMMARY STATISTICS City of Renton Proposed LTGO Bgnds,Series 2011 Interest Rates as of April 8,2011 Dated Date 05/17/2011 Delivery Date 05/17/2011 Last Maturity 12/01/2022 Arbitrage Yield 3.160368% True Interest Cost(TIC) 3.297187% Net Interest Cost WIC) 3.403268% 1(IC w/Interest only 3.892383% NIC w/Interest&OlD 3.315132% • N IC w/tnrerest.010&Lind-Discount 3A01268% All-tn TIC 3.344538% average Coupon 3.892383% Average Life(years1 6,808 • Duration or Issue(years) 6.017 Par Amount 174470000.00 • Bond Proceeds 18,156,521.30 •Total Interest 4,6?9,18694 • Net interest 4,047,485.64 Bond Years from Dated Date 11.8,929,388..89 Bond Years from Delivery Rate 118,923388.8 Total Debt Service 22,099,186.94 Maximum Annual Debt Service 1,999,300.00 Average Annual Debt Service • 1,915,191.94 • Underwriter',Fees(per 51000) Average Takedown - Other Fee 6.000000 Total Underwriters Discount 6.000000 • Bid Pike 103.329716 • Par Average Average PV of 1 bp Bond Component Value Price Coupon Life change Tax Exempt Serial Bonds 1.74470,000.00 103.930 3.892% 6.806 10,356.60 17,470.000.00 6.806 10,356.60 AII.ln Arbitrage TIC 11C Yield Par Value 11,470,000.00 17,470000.00 17,470,000.00 .4 Accrued Interest - - +Premium(Discount) 686,521..30 686,521.30 686,5213a -Underwriter's Discount -104,80.00 -1044820.00 •Cost of Issuance Expense •50,500.00 -Other Amounts - - Target Value 18,051.701.30 18,001,201.30 18,156,521..30 Target Date 05/17/2011 05/17/2011 0•S/17/2011 Yield 3.297187% 3344538% 3.160363% . CITY OF RENTON, WASHINGTON LIMITED',TAX GENERAL OBLIGATION BONDS, 2011 • I ORDINANCE NO. AN ORDINANCE OE THE CITY OF RENTON, "WASHINGTON, PROVIDING FOR THE ISSUANCE OF LIMITED TAX GENERAL OBLIGATION BONDS OF THE CITY IN THE PRINCIPAL AMOUNT OF NOT TO EXCEED $18,000,000 TO FINANCE ALL OR A PORTION OF • THE COSTS OF REPAIRING, RENOVATING AND IMPROVING EXISTING LIBRARY FACILITIES AND ACQUIRING LAND FOR AND CONSTRUCTING, IMPROVING AND EQUIPPING TWO NEW PUBLIC LIBRARY FACILITIES; PROVIDING THE FORM AND TERMS OF THE . BONDS; AND DELEGATING THE AUTHORITY TO APPROVE THE. FINAL TERMS OF THE BONDS. • PASSED: MAY 2, 2011 PREPARED BY: PACIFICA LAW GROUP LLP Seattle,Washington • � r" • CITY OF RENTON ORDINANCE NO. TABLE OF CONTENTS* Page Section 1. Definitions and Interpretation of Terms 4 Section 2. Authorization of the Projects 8 Section 3. Authorization of Bonds and Bond Details 9 Section 4. Registration, Exchange and Payments 9 Section 5. Redemption Prior to Maturity and Purchase of Bonds 14 Section 6. Form of Bonds 18 Section 7. Execution of Bonds 20 Section 8. Application of Bond Proceeds 21 Section 9. Tax Covenants 21 Section 10. Bond Fund and Provision for Tax Levy Payments 24 Section 11. Defeasance 24 Section 12. Sale of Bonds 25 Section 13. Bond Insurance 27 Section 14. Undertaking to Provide Ongoing Disclosure 27 Section 15. Lost,Stolen or Destroyed Bonds 32 Section 16. Severability 32 Section 17. Effective Date of Ordinance 32 *This Table of Contents is provided for convenience only and is not a part of this ordinance. • -i - - 04/17/11 • l CITY OF RENTON,WASHINGTON I ORDINANCE NO. AN ORDINANCE OF THE CITY OF RENTON, WASHINGTON, PROVIDING FOR THE ISSUANCE OF LIMITED TAX GENERAL OBLIGATION BONDS OF THE CITY IN THE PRINCIPAL AMOUNT OF NOT TO EXCEED $18,000,000 TO FINANCE ALL OR A PORTION OF THE COSTS OF REPAIRING, RENOVATING AND IMPROVING EXISTING LIBRARY FACILITIES AND ACQUIRING LAND FOR AND CONSTRUCTING, IMPROVING AND EQUIPPING TWO NEW PUBLIC LIBRARY FACILITIES; PROVIDING THE FORM AND TERMS OF THE BONDS; AND DELEGATING THE AUTHORITY TO APPROVE THE FINAL TERMS OF THE BONDS. • WHEREAS, pursuant to Ordinance No. 5479 of the City Council (the "Council") of the City of Renton, Washington (the "City"), adopted on August 3, 2009,the City stated its intent to join. the King County Library System ("KCLS") and called for an election to be held within the City on February 9, 2010;and WHEREAS, the number and proportion of the qualified electors required by law for the adoption thereof voted in favor of a proposition authorizing the annexation of the City into the 1 KCLS; and � WHEREAS, pursuant to the terms of an Interlocal Agreement between the City and KCLS, the City has agreed to acquire land, finance costs related to the construction.of two public library facilities, and lease the land to KCLS, and KCLS has agreed to own, operate and maintain the public library facilities under the terms of a long-term lease agreement; and • WHEREAS, existing City library facilities will be repaired, renovated and improved for other public uses; and WHEREAS, it is hereby found to be in the best interest of the City to'provide financing • for all or a portion of the costs of acquiring land for and constructing, improving and equipping two public library facilities and repairing, renovating and improving existing libraries for other • ORDINANCE NO. public uses (the "Projects"); and WHEREAS, the City is authorized by chapters 35A.40 and 39.46 RCW to borrow money and issue general obligation bonds to finance the costs of the Projects; and WHEREAS,the City now desires to construct the Projects and issue and sell such Limited Tax General Obligation Bonds by negotiated sale to Seattle-Northwest Securities Corporation, Seattle, Washington in the principal amount of not to exceed $18,000,000 (the "Bonds") to finance costs of the Projects; • NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON DOES ORDAIN AS FOLLOWS: Section 1. Definitions and Interpretation of Terms. (a) Definitions. As used in this ordinance, the following words shall have the following meanings: Beneficial Owner means any person that has or shares the power, directly or indirectly to make investment decisions concerning ownership of any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries). Bond Fund means the "City of Renton Limited Tax General Obligation Bond Debt Service Fund, 2011" authorized to be created pursuant to Section 10 of this ordinance. Bond Insurance Policy means the municipal bond insurance policy, if any, issued by the Insurer insuring the payment when due of the principal of and interest on the Bonds as provided therein. Bond Purchase Contract means the contract for the purchase of the Bonds between the Underwriter and City, executed pursuant to Section 12 of this ordinance. Bond Register means the registration books showing the name, address and tax -2- 04/12/11 • ORDINANCE NO. identification number of each Registered Owner of the Bonds, maintained pursuant to Section 149(a) of the Code. • Bond Registrar means initially, the fiscal agency of the State of Washington, for the purposes'of registering and authenticating the Bonds, maintaining the Bond Register, effecting transfer of ownership of the Bonds and paying interest on and principal of the Bonds. Bond Year means each one-year period that ends on the date selected by the City. The first and last Bond Years mai be short periods. If no day is selected by the City before the earlier of the final maturity date of the Bonds or the date that is five years after the date of issuance of the Bonds, Bond Years end on each anniversary of the date of issue and on the final maturity date of the Bonds. Bonds mean the City of Renton,Washington Limited Tax General Obligation Bonds, 2011 issued pursuant to this ordinance. City means the City ofiRenton, Washington,_a municipal corporation duly organized and existing by virtue of the laws of the State of Washington. Code means the Internal Revenue Code of 1986, as amended, and shall include all applicable regulations and rulings relating thereto. Commission means the Securities and Exchange Commission. • Council means the City Council as the general legislative authority of the City, as the same shall be duly and regularly constituted from time to time. Designated Representative means the Mayor, the Chief Administrative Officer, or the Finance Director of the City, or any successor to the functions of such office. DTC means The Depository Trust Company, New York, New York, a limited purpose trust company organized under the laws of the State of New York, as depository for the Bonds -3- 04/12/11 ORDINANCE NO. • • pursuant to Section 4 of this ordinance. Federal Tax Certificate means the certificate executed by the Designated Representative setting forth the requirements of the Code for maintaining the tax exemption of interest on the bonds. Finance Director shall mean the City's Finance and Information Services Administrator or the successor to such officer. Government Obligations mean those obligations now or hereafter defined as such in • chapter 39.53 RCW. Insurer means the municipal bond insurance company, if any, selected and designated by the Designated Representative, pursuant to Section 13 of this ordinance, or any successor thereto or assignee thereof, as issuer of a Bond Insurance Policy for all or a portion of the Bonds. Letter of Representations means the blanket issuer letter of representations from the City to DTC. MSRB means the Municipal Securities Rulemaking Board or any successors to its functions. Net Proceeds, when used with reference with the Bonds, mean the principal amount of the Bonds, plus accrued interest and original issue premium, if any, and less original issue discount, if any. Private Person means any natural person engaged in a trade or business or any trust, estate, partnership, association, company or corporation. Private Person Use means the use of property in a trade or business by a Private Person if such use is other than as a member of the general public. Private Person Use includes -4- 04/12/11 . ORDINANCE NO. ownership of the property by the Private Person as well as other arrangements that transfer to the Private Person the actual or beneficial use of the property (such as a lease, management or incentive payment contract or other special arrangement) in such a manner as to set the • Private Person apart from the general public. Use of property as a member of the general public includes attendance by the Private Person at municipal meetings or business rental of property to the Private Person]on a day-to-day basis if the rental paid by such Private Person is the same as the rental paid by any Private Person who desires to rent the property. Use of property by nonprofit community groups or community recreational groups is not treated as Private Person Use if such use is incidental to the governmental uses of property, the property is made available for such use by all such community groups on an equal basis and such community groups are charged only a de minimis fee to cover custodial expenses. Project Fund means the "Library Construction Fund" as described in Section 8 of this ordinance. Projects mean the capital projects described in Section 2 of this ordinance. Registered Owner means the person named as the registered owner of a Bond in the Bond Register. For so long as the Bonds are held in book-entry only form, DTC shall be deemed to be the sole Registered Owner. Rule means the Commission's Rule 15c2-12 under the Securities Exchange Act of 1934, as the same may be amended from time to time. Underwriter means Seattle-Northwest Securities Corporation, Seattle, Washington. (b) Interpretation. In this ordinance, unless the context otherwise requires:. (1) The terms "hereby,"•"hereof," "hereto," "herein," "hereunder" and any similar terms, as used in this ordinance, refer to this ordinance as a whole and not to any -5- 04/12/11 ORDINANCE NO. particular article, section, subdivision or clause hereof, and the term "hereafter" shall mean after, and the term "heretofore" shall mean before,the date of this ordinance; (2) Words of the masculine gender shall mean and include correlative words of the feminine and neuter genders and words importing the singular number shall mean and include the plural number and vice versa; (3) Words importing persons shall include firms, associations, partnerships (including limited partnerships), trusts, corporations and other legal entities, including public bodies, as well as natural persons; (4) Any headings preceding the text of the several articles and sections of this ordinance, and any table of contents or marginal notes appended to copies hereof, shall be solely for convenience of reference and shall not constitute a part of this ordinance, nor shall they affect its meaning, construction or effect; and (5) All references herein to "articles," "sections" and other subdivisions or clauses are to the corresponding articles,sections,subdivisions or clauses hereof. Section 2. Authorization of the Projects. The Bonds are being issued to finance all or a portion of the costs of acquiring land for and constructing, improving and equipping two public library facilities and repairing, renovating and improving existing libraries for other public uses (together, the "Projects"). Any remaining costs of the Projects shall be paid from other City funds legally available for such purposes. • If the Council shall determine that it has become impractical to undertake or complete any portion of the Projects by reason of changed conditions, the City shall not be required to undertake or complete such portions of the Project. If the Projects have been completed or- duly provided for, or found to be impractical, the Council may apply the Bond proceeds or any -6- • 04/12/11 • I ORDINANCE NO. portion thereof to the redemption of the Bonds or to other capital purposes as the Council, in its discretion, sh`alI determine. Section 3. Authorization of Bonds and Bond Details. For the purpose of paying the costs of the Projects and paying costs of issuance of the Bonds, including, but not limited to, the payment of the premium cost for a Bond Insurance Policy, if any, the City shall issue and sell its limited tax general obligation bonds in the aggregate principal amount of not to exceed I $18,000,000 (the"Bonds"). The Bonds shall be general obligations of the City, shall be designated "City of Renton, Washington, Limited Tax General Obligation Bonds, 2011"; shall be dated as of their date of delivery; shall be fully registered as to both principal and interest; shall be in the denomination of $5,000 each, or any integral multiple thereof, provided that no Bond shall represent more than one maturity; shall be numbered separately in such manner and with any additional designation as the Bond Registrar deems necessary for purposes of identification;and shall bear interest from their date payable on the first days of each June and December, commencing on December 1, 2011, at rates set forth in the Bond Purchase Contract; and shall mature on the • dates and in the principal amounts set forth in the Bond Purchase Contract and as approved by the Designated Representative pursuant to Section 12. The Bonds of any of the maturities may be combined and issued as term bonds, subject to mandatory redemption as provided in the Bond Purchase Contract. Section 4. Registration, Exchange and Payments. (a). Bond Registrar/Bond Register. The City hereby specifies and adopts the system of registration approved by. the Washington State Finance Committee from time to time • through the appointment of:state fiscal agencies. The City shall cause a bond register to be -7- o4nv11 ORDINANCE NO. maintained by the Bond Registrar. So long as any Bonds remain outstanding,the Bond Registrar shall make all necessary provisions to permit the exchange or registration or transfer of Bonds at its principal corporate trust office. The Bond Registrar may be removed at any time at the option of the Finance Director upon prior notice to the Bond Registrar and a successor Bond Registrar appointed by the Finance Director. No resignation or removal of the Bond Registrar shall be effective until a successor shall have been appointed and until the successor Bond Registrar shall have accepted the duties of the Bond Registrar hereunder. The Bond Registrar is authorized, on behalf of the City,to authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of such Bonds and this ordinance and to carry out all of the Bond Registrar's powers and duties under this ordinance. The Bond Registrar shall be responsible for its representations contained in the Certificate of Authentication of the Bonds. (b) Registered Ownership. The City and the Bond Registrar, each in its discretion, may deem and treat the Registered Owner of each Bond as the absolute owner thereof for all purposes (except as provided in Section 14 of this ordinance), and neither the City nor the Bond Registrar shall be affected by any notice to the contrary. Payment of any such Bond shall be made only as described in Section 4(h) hereof, but such Bond may be transferred as herein provided. All such payments made as described in Section 4(h) 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. (c) DTC Acceptance/Letters of Representations. The Bonds initially shall be held in fully immobilized form by DTC acting as depository. To induce DTC to accept the Bonds as eligible for deposit at DTC,the City has executed and delivered to DTC a Blanket Issuer Letter of Representations. Neither the City nor the Bond Registrar will have any responsibility or -8- 04/12/11 ORDINANCE NO. obligation to DTC participants or the persons for whom they act as nominees (or any successor depository) with respect to the Bonds in respect of the accuracy of any records maintained by DTC(or any successor depository) or any DTC participant,the payment by DTC (or any successor depository) or any DTC participant of any amount in respect of the principal of or interest on Bonds, any notice which is permitted or required to be given to Registered Owners under this ordinance (except such notice as shall be required to be given by the City to the Bond Registrar or to DTC (or any successor depository)), or any consent given or other action taken by DTC (or any successor depository) as the Registered Owner. For so long as any Bonds are held in fully-immobilized form hereunder, DTC or its successor depository shall be deemed to be the Registered Owner for all purposes hereunder, and all references herein to the Registered Owners shall mean DTC (or any successor depository) or its nominee and shall not mean the owners of any beneficial interest in such Bonds. If any Bond shall be duly presented for payment and funds have not been duly provided by the City on such applicable date, then interest shall continue to accrue thereafter on the unpaid principal thereof at the rate stated on such Bond until it is paid. 1 ' (d) Use of Depository. (1) The Bonds shall be registered initially in the name of "Cede & Co.", as nominee of DTC, with one Bond maturing on each of the maturity dates for the Bonds in a denomination corresponding to the total principal therein designated to mature on such date. Registered ownership of such immobilized Bonds, or any portions thereof, may not thereafter be transferred except (A) to any successor of DTC or its nominee, provided that any such successor shall be qualified under any applicable laws to provide the service proposed to be provided by it; (B) to any substitute depository appointed by the Finance Director pursuant to -9- 04/12/11 ORDINANCE NO. subsection (2) below or such substitute depository's successor; or (C) to any person as provided in subsection (4) below. (2) Upon the resignation of DTC or its successor(or any substitute depository or its successor) from its functions as depository or a determination by the Finance Director to discontinue the system of book entry transfers through DTC or its successor (or any substitute depository or its successor), the Finance Director may hereafter appoint a substitute depository. Any such substitute depository shall be qualified under any applicable laws to provide the services proposed to be provided by it. (3) In the case of any transfer pursuant to clause,(A) or (B) of subsection (1) above, the Bond Registrar shall, upon receipt of all outstanding Bonds, together with a written request on behalf of the Finance Director, issue a single new Bond for each maturity then outstanding, registered in the name of such successor or such substitute depository, or their nominees, as the case may be, all as specified in such written request of the Finance Director. (4). In the event that (A) DTC or its successor (or substitute depository or its successor) resigns from its functions as depository, and no substitute depository can be obtained, or (B) the Finance Director determines that it is in the best interest of the beneficial owners of the Bonds that such owners be able to obtain such bonds in the form of Bond certificates, the ownership of such Bonds may then be transferred to any person or entity as, herein provided, and shall no longer be held in fully-immobilized form. The Finance Director shall deliver a written request to the Bond Registrar, together with a supply of definitive Bonds, to issue Bonds as herein provided in any authorized denomination. Upon receipt by the Bond Registrar of all then outstanding Bonds together with a written request on behalf of the Finance Director to the Bond Registrar, new Bonds shall be issued in the appropriate denominations and - 10- 04„2111 ORDINANCE NO. registered in the names of such persons as are requested in such written request. (e) Registration of Transfer of Ownership or Exchange; Change in Denominations. The transfer of any Bond may be registered and Bonds may be exchanged, but no transfer of any such Bond shall be valid unless it is surrendered to the Bond Registrar with the assignment form appearing on such Bond duly.executed by the Registered Owner or such Registered Owner's duly authorized agent in a manner satisfactory to the Bond Registrar. Upon such surrender, the Bond Registrars shall cancel the surrendered Bond and shall authenticate and deliver, without charge to the'Registered Owner or transferee therefor, a new Bond (or Bonds at the option of the new Registered Owner) of the same date, maturity and interest rate and for the same aggregate principal amount in any authorized denomination, naming as Registered 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. Any Bond may be surrendered to the Bond Registrar and exchanged, without charge, for an equal aggregate principal amount of Bonds of the same date, maturity and interest rate, in any authorized denomination. The Bond Registrar shall not be obligated to register the transfer or to exchange any Bond during the 15 days;preceding any interest payment or principal payment date any such Bond is to be redeemed.' (f) Bond Registrar's Ownership of Bonds. The Bond Registrar may become the Registered Owner of any Bond with the same rights it would have if it were not the Bond Registrar, and to the extent permitted by law, may act as depository for and permit any of its officers or directors to act as member of, or in any other capacity with respect to, any committee formed to protect the right of the Registered Owners of Bonds. (g) Registration Covenant. The City covenants that, until all Bonds have been • - 11- 04/12/11 ORDINANCE NO. surrendered and canceled, it will maintain a system for recording the ownership of each Bond that complies with the provisions of Section 149 of the Code. (h) Place and Medium of Payment. Both principal of and interest on the Bonds shall be payable in lawful money of the United States of America. Interest on the Bonds shall be • calculated on the basis of a year of 360 days and twelve 30-day months. For so long as all Bonds are in fully immobilized form, payments of principal and interest thereon shall be made as provided in accordance with the operational arrangements of DTC referred to in the Letter of Representations. In the event that the Bonds are no longer in fully_immobilized form, interest on the Bonds shall be paid by check or draft mailed to the Registered Owners at the addresses for such Registered Owners appearing on the Bond Register on the fifteenth day of the month preceding the interest payment date, or upon the written request of a Registered Owner of more than $1,000,000 of Bonds (received by the Bond Registrar at least 15 days prior to the • applicable payment date), such payment shall be made by the Bond Registrar by wire transfer to the account within the United States designated by the Registered Owner. Principal of the Bonds shall be payable upon presentation and surrender of such Bonds by the Registered Owners at the principal office of the Bond Registrar. Section 5. Redemption Prior to Maturity and Purchase of Bonds. (a) Mandatory Redemption of Term Bonds and Optional Redemption, if any. The Bonds shall be subject to optional redemption on the dates, at the prices and under the terms set forth in the Bond Purchase Contract approved by the Designated Representative pursuant to Section 12 of this ordinance. The Bonds shall be subject to mandatory redemption to the extent, if any, set forth in the Bond Purchase Contract and as approved by the Designated Representative pursuant to Section 12 of this ordinance. - 12- 04/12!11 ORDINANCE NO. (b) Purchase of Bonds. The City reserves the right to purchase any of the Bonds offered to it at any time at a price deemed reasonable by the Designated Representative. (c) Selection of Bonds for Redemption. For as long as the Bonds are held in book-entry only.form, the selection of particular Bonds within a maturity to be redeemed shall be made in accordance with the operational arrangements then in effect at DTC. If the Bonds are no longer held in uncertificiated form, the selection of such Bonds to be redeemed and the surrender and reissuance thereof, as applicable, shall be made as provided in the following provisions of this subsection (c). If the City redeems at any one time fewer than all of the Bonds having the same maturity date,the particular Bonds or portions of Bonds of such maturity to be redeemed shall be selected I;y lot (or in such manner determined by the Bond Registrar) in increments of$5,000. In thelcase of a Bond of a denomination greater than $5,000, the City and the Bond Registrar shall treat each Bond as representing such number of separate Bonds each of the denomination of($5,000 as is obtained by dividing the actual principal amount of such Bond by $5,000. In the event that only a portion of the principal sum of a Bond is redeemed, upon surrender of such Bond at the principal office of the Bond Registrar there shall be issued to the Registered Owner, without charge therefor, forthe then unredeemed balance of the principal sum thereof),at the option of the Registered Owner, a Bond or Bonds of like maturity and interest rate in any of the denominations herein authorized. (d) Notice of Redemption. (1) Official Notice. For so long as the Bonds are held in uncertificated form, notice of redemption (which notice may be conditional) shall be given in accordance with the operational arrangements of DTC as then in effect, and neither the City nor the Bond Registrar will provide any notice of redemption to any Beneficial Owners. Thereafter(if the Bonds are no • - 13- 04/12111 ORDINANCE NO. longer held in uncertificated form), notice of redemption shall be given in the manner hereinafter provided. Unless waived by any owner of Bonds to be redeemed, official notice of any,such redemption (which redemption may be conditioned by the Bond Registrar on the receipt of sufficient funds for redemption or otherwise) shall be given by the Bond Registrar on behalf of the City by mailing a copy of an official redemption notice by first class mail at least 20 days and not more than 60 days prior to the date fixed for redemption to the Registered Owner of the Bond or Bonds to be redeemed at the address shown on the Register or at such other address as is furnished in writing by such Registered Owner to the Bond Registrar. All official notices of redemption shall be dated and shall state: (A) the redemption date, (B) the redemption price, (C) if fewer than all outstanding Bonds are to be redeemed, the identification by maturity (and, in the case of partial redemption, the respective principal amounts) of the Bonds to be redeemed, (D) that on the redemption date the redemption price will become due and payable upon each such Bond or portion thereof called for redemption, and that interest thereon shall cease to accrue from and after said date, and (E) the place where such Bonds are to be surrendered for payment of the redemption price,which place of payment shall be the principal office of the Bond Registrar. On or prior to any redemption date, the City shall deposit with the Bond Registrar an amount of money sufficient to pay the redemption price of all the Bonds or portions of Bonds which are to be redeemed on that date. (2) Effect of Notice; Bonds Due. If an unconditional notice of redemption has - 14- , 04„2111 ORDINANCE NO. been given as aforesaid, the Bonds or portions of Bonds so to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date such Bonds or portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for r;edeniption in accordance with said notice, such Bonds shall be paid by the Bond.Registrar at the redemption price. Installments of interest due on or prior to the redemption date shall bei payable as herein provided for payment of interest. All Bonds which have been redeemed shall be canceled by the Bond Registrar and shall not be reissued. (3) Additional Notice. In addition to the foregoing notice, further notice shall be given by the City as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice shall in any manner defeat the effectiveness of a call for. redemption if notice thereof is given as above prescribed. Each further notice of redemption given hereunder shall contain the information required above for an official notice of redemption plus (A) the CUSIP numbers of all Bonds being redeemed; (B) the date of issue of the Bonds as originally issued; (C) the rate of interest borne by each Bond being redeemed; (D) the maturity date of each Bond being redeemed; and (E) any other descriptive information needed to identify accurately the Bonds being redeemed. Each further notice of redemption may be sent at least 20 days before the redemption date to each party entitled to receive notice pursuant to Section 14 and to the Underwriter and with such additional information as the City shall deem appropriate, but such mailings shall not be a condition precedent to the redemption of such Bonds. (4) Amendment of Notice Provisions. The foregoing notice provisions of this Section 5, including but not limited to the information to be included in redemption notices and the persons designated to receive notices, may be amended by additions, deletions and - 15- 04/12/11 ORDINANCE NO. • changes in order to maintain compliance with duly promulgated regulations and recommendations regarding notices of redemption of municipal securities. Section 6. Form of Bonds. The Bonds shall be in substantially the following form: [STATEMENT OF INSURANCE] UNITED STATES OF AMERICA NO. $ STATE OF WASHINGTON CITY OF RENTON LIMITED TAX GENERAL OBLIGATION BOND, 2011 INTEREST RATE: % MATURITY DATE: CUSIP NO.: REGISTERED OWNER: CEDE & CO. PRINCIPAL AMOUNT: The City of Renton, Washington (the "City"), hereby acknowledges itself to owe and for value received promises to pay to the Registered Owner identified above, or registered assigns, on the Maturity Date identified above,the Principal Amount indicated above and to pay interest thereon from , 2011, or the most recent date to which interest has been paid or • duly provided for until payment of this bond at the Interest Rate set forth above, payable on December 1, 2011, and semiannually thereafter on the first days of each succeeding June and December. Both principal of and interest on this bond are payable in lawful money of the United States of America. The fiscal agency of the State of Washington has been appointed by - the City as the authenticating agent, paying agent and registrar for the bonds of this issue (the "Bond Registrar"). For so long as the bonds of this issue are held in fully immobilized form, payments of principal and interest thereon shall be made as provided in accordance with the operational arrangements of The Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter of Representations (the "Letter of Representations")from the City to DTC. The bonds of this issue are issued under and in accordance with the provisions of the Constitution and applicable statutes of the State of Washington and Ordinance No. duly passed by the City Council on May 2, 2011 (the "Bond Ordinance"). Capitalized terms used in this bond have the meanings given such terms in the Bond Ordinance. This bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Bond Ordinance until the Certificate of Authentication hereon shall have been manually signed by or on behalf of the Bond Registrar or its duly designated agent. - 16- 04112/„ ORDINANCE NO. This bond is one of an authorized issue of bonds of*like date, tenor, rate of interest and date of maturity, except as to number and amount in the aggregate principal amount of$ and is issued pursuant to the Bond Ordinance to provide funds (a) to pay all or a portion of the cost of acquiring land for and constructing, improving and equipping two public library facilities, and repairing, renovating and improving existing libraries for other public uses and (b) to pay costs of issuance. The bonds of this issue are subject to redemption as provided in the Bond Ordinance and the Bond Purchase Contract. The City hereby irrevocably covenants and agrees with the owner of this bond that it will include in its annual budget and levy taxes annually, within and as a part of the tax levy permitted to the City without a vote of the electorate, upon all the property subject to taxation in amounts sufficient, together with other money legally available therefor, to pay the principal of and interest on this bond as the same shall become due. The full faith, credit and resources of the City are hereby irrevocably pledged for the annual levy and collection of such taxes and the prompt payment of such principal and interest. The bonds of this issue have not been designated by the City as "qualified tax-exempt obligations"for investment byfinancial institutions under Section 265(b) of the Code. The pledge of tax levies for payment of principal of and interest on the bonds may be discharged prior to maturity of the bonds by making provision for the payment thereof on the terms and conditions set forth,in the Bond Ordinance. It is hereby certified that all acts, conditions and things required by the Constitution and statutes of the State of Washington to exist, 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 and the bonds of this issue does not violate any constitutional, statutory or other limitation upon the amount of bonded indebtedness that the City may incur. IN WITNESS WHEREOF, the City of Renton, Washington has caused,this bond to be executed by the manual or facsimile signatures of the Mayor and the City Clerk and the seal of the City imprinted, impressed or otherwise reproduced hereon as of this day of , 2011. [SEAL] CITY OF RENTON, WASHINGTON By /s/manual or facsimile Mayor ATTEST: /5/manual or facsimile City.Clerk - 17- 04/12/11 ORDINANCE NO. The Bond Registrar's Certificate of Authentication on the Bonds shall be in substantially the following form: CERTIFICATE OF AUTHENTICATION This bond is one,of the bonds described in the within-mentioned Bond Ordinance and is one of the Limited Tax General Obligation Bonds, 2011 of the City of Renton, Washington, dated , 2011. WASHINGTON STATE FISCAL AGENCY, as • Bond Registrar By Section 7. Execution of Bonds. The Bonds shall be executed on behalf of the City with the manual or facsimile signatures of the Mayor and City Clerk of the City and the seal of the City shall be impressed, imprinted or otherwise reproduced thereon. Only such Bonds as shall bear thereon a• Certificate of Authentication in the form hereinbefore recited, manually executed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of 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. In case either of the officers who shall have executed the Bonds shall cease to be an officer or officers of the City before the Bonds so signed shall have been authenticated or delivered by the Bond Registrar, or issued by the City, such Bonds may !nevertheless be authenticated, delivered and issued and upon such authentication, delivery and issuance, shall be as binding upon the City as though those who signed the same had continued to be such officers of the City. Any Bond may be signed and attested on behalf of the City by such persons • who at the date of the actual execution of such Bond, are the proper officers of the City, - 18- 04/12/11 ORDINANCE NO. although at the original date of such Bond any such person shall not have been such officer of the City. Section 8. Application of Bond Proceeds. The City shall establish a fund designated the "Library Construction Fund" (the "Project Fund") into which the proceeds of the Bonds (other than accrued interest, if any) shall be deposited. Money in the Project Fund shall be used to pay the costs of the Projects and costs of issuance of the Bonds. The Finance Director may invest money in the Project Fund in legal investments for City funds. Earnings on such investments shall accrue to the benefit of the Project Fund. Any part of the proceeds of the Bonds remaining in the Project Fund after all costs of the Projects have been paid (including costs of issuance) may be used for capital purposes of the City in accordance with the Federal Tax Certificate or may be transferred to the Bond Fund, after consultation with bond counsel to the City. • Section 9. Tax Covenants. The City covenants that it will not take or permit to be taken on its behalf any action that would adversely affect the exemption from federal income taxation of the interest on the Bonds and will take or require to be taken such acts as may reasonably be within its ability and as may from time to time be required under applicable law to continue the exemption from federal income taxation of the interest on the Bonds. (a) Arbitrage Covenant. Without limiting the generality of the foregoing, the City covenants that it will not take any action or fail to take any action with respect to the proceeds of sale of the Bonds or any other funds of the City which may be deemed to be proceeds of the Bonds pursuant to Section 148 of the Code and the regulations promulgated thereunder which, if such use had been reasonably expected on the dates of delivery of the Bonds,to the initial purchasers thereof, would have caused the Bonds to be treated as "arbitrage bonds" within the - 19- 04/12/1 1 ORDINANCE NO. meaning of such term as used in Section 148 of the Code. The City represents that it has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is an issuer whose arbitrage certifications may not be relied upon. The City will comply with the requirements of Section 148 of the Code and the applicable regulations thereunder throughout the term of the Bonds. (b) Private Person Use Limitation for Bonds. The City covenants that for as long as the Bonds are outstanding, it will not permit: (1) More than 10% of the Net Proceeds of the Bonds to be allocated to any Private Person Use; and (2) More than 10% of the principal or interest payments on the Bonds in a . Bond Year to be directly or indirectly: (A) secured by any interest in property used or to be used for any Private Person Use or secured by payments in respect of property used or to be used for any Private Person Use, or (B) derived from payments (whether or not made to the City) in respect of property, or borrowed money, used or to be used for any Private Person Use. The City further covenants that, if: (3) More than five percent of the Net Proceeds of the Bonds are allocable to any Private Person Use; and (4) More than five percent of the principal or interest payments on the Bonds in a Bond Year are (under the terms of this ordinance or any underlying arrangement) directly or indirectly: (A) secured by any interest in property used or to be used for any Private Person Use or secured by payments in respect of property used or to be used for any Private Person Use, or -20- 04/72111 ORDINANCE NO. (B) derived from payments (whether or not made to the City) in respect of property, or borrowed money, used or to be used for any Private Person Use, then, (i) any Private Person Use of the Projects described in subsection (3) hereof or Private Person Use payments described in subsection (4) hereof that is in excess of the five percent limitations described in such subsections (3) or (4) will be for a Private Person Use that is related to the state or local governmental use of the Projects funded by the proceeds of the Bonds, and (ii) any Private Person Use will not exceed the amount of Net Proceeds of the Bonds allocable to the state or localgovernmental use portion of the Projects to which the Private Person Use of such portion of the Projects funded by the proceeds of the Bonds relate. The City further covenants that it will comply, with any limitations on the use of the Projects funded by the proceeds of the Bonds by other than state and local governmental users that are necessary, in the opinion of its bond counsel, to preserve the tax exemption of the interest on the Bonds. The covenants of this section are specified solely to assure the continued exemption from regular income taxation of the interest on the Bonds. (c) Modification of Tax Covenants. The covenants of this section are specified solely to assure the continued exemption from regular income taxation of the interest on the Bonds. To that end, the provisions of this section may be modified or eliminated without any requirement for formal amendment thereof upon receipt of an opinion of the City's bond counsel that such modification or elimination will not adversely affect the tax exemption of interest on any Bonds. (d) No Designation under Section 265(6). The City has not designated the Bonds as "qualified tax-exempt obligations" under Section 265(b)(3) of the Code for investment by financial institutions. -21- 04/12/11 ORDINANCE NO. Section 10. 'Bond Fund and Provision for Tax Levy Payments. The City hereby authorizes the creation of a fund to be used for the payment of debt service on the Bonds, designated as the "City of Renton Limited Tax General Obligation Bond Debt Service Fund, 2011" (the"Bond Fund"). No later than the date each payment of principal of and/or interest on the Bonds becomes due and payable, the City shall transmit sufficient funds, from the Bond Fund or from other legally available sources to the Bond Registrar for the payment of such principal and/or interest. Money in the Bond Fund not needed to pay the interest or principal next coming due may be invested in legal investments for City funds. The City hereby irrevocably covenants and agrees for as long as any of the Bonds are outstanding and unpaid that each year it will include in its budget and levy an ad valorem tax upon all the property within the City subject to taxation in an amount that will be sufficient, together with all other revenues and money of the City legally available for such purposes, to pay the,principal of and interest on the Bonds when due. The City hereby irrevocably pledges that the annual tax provided for herein to be levied for the payment of such principal andinterest shall be within and as a part of the tax levy permitted to cities without a vote of the people, and that a sufficient portion of each annual levy to be levied and collected by the City prior to the full payment of the principal of and interest on the Bonds will be and is hereby irrevocably set aside, pledged and appropriated for the payment of the principal of and interest on the Bonds. The full faith, credit and resources of the City are hereby irrevocably pledged for the annual levy and collection of said taxes and for the prompt payment of the principal of and interest on the Bonds when due. Section 11. Defeasance. In the event that the City, to effect the payment, retirement or redemption of any Bond, sets aside in the Bond Fund or in another special account, cash or -22- 04/12/11 ' ORDINANCE NO. noncallable Government Obligations, or any combination of cash and/or noncallable Government Obligations, in amounts and maturities which, together with the known earned income therefrom, are sufficient_to redeem or pay and retire such Bond in accordance with its terms and to pay when due the interest and redemption premium, if any, thereon, and such cash and/or noncallable Government Obligations are irrevocably set aside and pledged for such purpose, then no further payments need be made into the Bond Fund for the payment of the principal of and interest on such Bond. The owner of a Bond so provided for shall cease to be entitled to any lien, benefit or security of this ordinance except the right to receive payment of principal, premium, if any, and interest from the Bond Fund or such special account, and such Bond shall be deemed to be not outstanding under this ordinance. The City shall give written notice of defeasance to the owners of all Bonds so provided for within 30 days of the defeasance and to each party entitled to receive notice in accordance with Section 14 of this ordinance. Section 12. Sale of Bonds. (a) Bond Sale. The Bonds shall be sold at negotiated sale to the Underwriter pursuant to the terms of the Bond Purchase Contract. The Underwriter has advised the Council that market conditions are fluctuating and, as a result, the most favorable market conditions may occur on a day other than a regular meeting date of the Council. The Council has determined that it would be in the best interest of the City to delegate to the Designated Representative for a limited time the authority to approve the final interest rates, aggregate principal amount, principal amounts of each maturity of the Bonds and redemption rights. The Designated Representative is hereby authorized to approve the final interest rates, aggregate principal amount, principal maturities and redemption rights for the Bonds in the manner -23- 04!12/11 ORDINANCE NO. • provided hereafter so long as (a) the aggregate principal amount of the Bonds does not exceed $18,000,000 and (b) the true interest cost for-the Bonds (in the aggregate) does not exceed %. In determining whether or not to acquire a Bond Insurance Policy and determining the final interest rates, aggregate principal amounts, principal maturities and redemption rights,the Designated Representative shall take into account those factors that, in his or her judgment, will result in the lowest true interest cost on the Bonds to their maturity, including, but not limited to current financial market conditions and current interest rates for obligations comparable in tenor and quality to the Bonds. Subject to the terms and conditions set forth in this Section 12, the Designated Representative is hereby authorized to execute the Bond Purchase Contract. The signature of one of the listed Designated Representatives shall be sufficient. Following the execution of the Bond Purchase Contract, the Designated Representative or the Finance Director shall provide a report to the Council, describing the final terms of the Bonds approved pursuant to the authority delegated in this section. The authority granted to the Designated Representative by this Section 12 shall expire 120 days after the effective date of this ordinance. If a Bond Purchase Contract for the Bonds has not been executed within 120 days after the effective date of this ordinance, the authorization for the issuance of the Bonds shall be rescinded, and the Bonds shall not be issued nor their sale approved unless such Bonds shall have been re-authorized by ordinance of the Council. The ordinance re-authorizing the issuance and sale of such Bonds may be in the form of a new ordinance repealing this ordinance in whole or in part or may be in the form of an amendatory ordinance approving a bond purchase contract or establishing terms and conditions for the authority delegated under this Section 12. -24- 04/12/11 ORDINANCE NO. (b) Delivery of Bonds; Documentation. Upon the passage and approval of this ordinance, the proper officials of the City including the Designated Representative, are authorized and directed to undertake all action necessary for the prompt execution and delivery of the Bonds to the Underwriter thereof and further to execute all closing'certificates and documents required to effect the closing and delivery of the Bonds in accordance with the ,- terms of the Bond Purchase Contract. (c) Preliminary and Final Official Statements. The Finance Director is hereby authorized to ratify and to deem final the preliminary Official Statement relating to the Bonds for the purposes of the Rule. The Finance Director is further authorized to ratify and to approve for purposes of the Rule, on behalf of the City, the Official Statement relating to the issuance ' and sale of the Bonds and the distribution of the Official Statement pursuant thereto with such changes, if any, as may be deemed by her to be appropriate. Section 13. Bond Insurance. The Finance Director is hereby further authorized to solicit proposals from municipal bond insurance companies for the issuance of a Bond Insurance Policy. In the event that the Finance Director receives multiple proposals, the Finance Director may select the proposal having:the lowest cost and resulting in an overall lower interest cost with respect to the Bonds. The Finance Director may execute a commitment received from the Insurer selected by the Finance Director. The Council further authorizes and directs all proper officers, agents, attorneys and employees of the City to cooperate with the Insurer in preparing such additional agreements, certificates, and other documentationon behalf of the City as shall be necessary or advisable in providing for the Bond Insurance Policy. Section 14. Undertaking to Provide Ongoing Disclosure. (a) Contract/Undertaking. This section constitutes the City's written undertaking for -25- 04/12/11 ORDINANCE NO. the benefit of the owners, including Beneficial Owners, of the Bonds as required by Section (b)(5) of the Rule. (b) Financial Statements/Operating Data. The City agrees to provide or cause to be provided to the Municipal Securities Rulemaking Board ("MSRB"), the following annual financial information and operating data for the prior fiscal year (commencing in 2011 for the fiscal year ended December 31, 2010): 1. Annual financial statements, which statements may or may not be audited, showing ending fund balances for the City's general fund prepared in accordance with the Budgeting Accounting and Reporting System prescribed by the Washington State Auditor pursuant to RCW 43.09.200 (or any successor statute) and generally of the type included in the official statement for the Bonds under the heading "General Fund Comparative Statement of Revenues, Expenditures and Changes in Fund Balance"; 2. The assessed valuation of taxable property in the City; 3. Ad valorem taxes due and percentage of taxes collected; 4. Property tax levy rate per$1,000 of assessed valuation; and 5. Outstanding general obligation debt of the City. Items 2-5 shall be required only to the extent that such information is not included in the annual financial statements. The information and data described above shall be provided on or before nine months after the end of the City's fiscal year. The City's current fiscal year ends December 31. The City may adjust such fiscal year by providing written notice of the change of fiscal year to the MSRB. In lieu of providing such annual financial information and operating data, the City may cross-reference to other documents available to the public on the MSRB's internet website or -26- 04/12/11 • ORDINANCE NO. filed with the Commission. If not provided as part of the annual financial information discussed above,the City shall provide the City's audited annual financial statement prepared in accordance with the Budgeting Accounting and Reporting System prescribed by the Washington State Auditor pursuant to RCW 43.09.200(or any successor statute) when and if available to the MSRB. (c) Listed Events. the City agrees to provide or cause to be provided to the MSRB, in a timely manner not in excess)of ten business days after the occurrence of the event, notice of the occurrence of any of the following events with respect to the Bonds: 1. Principal and interest payment delinquencies; 2. Non-payment related defaults, if material; 3. Unscheduled draws on debt service reserves reflecting financial 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, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; 7. Modifications to the rights of Bondholders, if material; 8. Optional, contingent or unscheduled Bond calls other than scheduled sinking fund redemptions for which notice is given pursuant to Exchange -27- 04/12/11 ORDINANCE NO. Act Release 34-23856, if material, and tender offers; 9. Defeasances; 10. Release, substitution, or sale of property securing repayment of the Bonds, if material; 11. Rating changes; 12. Bankruptcy, insolvency, receivership or similar event of the City; 13. The consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and 14. Appointment of a successor or additional trustee or the change of name of a trustee, if material. The'City shall promptly determine whether the events described above are material. (d) Format for Filings with the MSRB. All notices, financial information and operating data required by this undertaking to be provided to the MSRB must be in an electronic format as prescribed by the MSRB. All documents provided to the MSRB pursuant to this undertaking must be accompanied by identifying information as prescribed by the MSRB. (e) Notification Upon Failure to Provide Financial Data. The City agrees to provide or cause to be provided, in a timely manner,to the MSRB notice of its failure to provide the annual financial information described in Subsection (b) above on or prior to the date set forth in Subsection (b) above. -28- 04/12/11 ORDINANCE NO. (f) Termination/Modification. The City's obligations to provide annual financial information and notices of certain listed events shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. Any provision of this section shall be null and void if the City (1) obtains an opinion of nationally recognized bond counsel to the effect that the portion of the Rule that requires that provision is invalid, has been repealed retroactively or otherwise does not apply to the Bonds and (2) notifies the MSI,tB of such opinion and the cancellation of this section. The City may amend this section with an opinion of nationally recognized bond counsel in accordance with the Rule. j In the event of any amendment of this section, .the City shall describe such amendment in the next annual report, and shall include,.a narrative explanation of the reason for the amendment and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the City. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (A) notice of such change shall be given in the same manner as fora listed event under Subsection (c), and (B) the annual report for the year in which the change is made shall present a comparison in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. (g) Bond Owner's Remedies Under This Section. The right of any bondowner or • Beneficial Owner of Bonds to enforce the provisions of this section shall be limited to a right to obtain specific enforcement of'the City's obligations under this section, and any failure by the City to comply with the provisions of this undertaking shall not be an event of default with respect to the Bonds. -29- 04/12/11 I r ORDINANCE NO. (h) No Default. Except as otherwise disclosed in the City's official statement relating to the Bonds, the City is not and has not been in default in the performance of its'obligations of any prior undertaking for ongoing disclosure with respect to its obligations. Section 15. Lost,Stolen or Destroyed Bonds. In case any Bond or Bonds shall be lost, stolen or destroyed, the Bond Registrar may execute and deliver a new Bond or Bonds of like date, number and tenor to the Registered Owner thereof upon the Registered Owner's paying the expenses and charges of the City and the Bond Registrar in connection therewith and upon his/her filing with the City evidence satisfactory to the City that such Bond was actually lost, stolen or destroyed and of his/her ownership thereof, and upon furnishing the City and/or the Bond Registrar with indemnity satisfactory to the City and the Bond Registrar. Section 16. Severability. If any one or more of the covenants or agreements provided in this ordinance to be performed on the part of the City shall be declared by any court of competent jurisdiction to be contrary to law, then such covenant or covenants, agreement or agreements, shall be null and void and shall be deemed separable from the remaining covenants and agreements of this ordinance and shall in no way affect the validity of the other provisions of this ordinance or of the Bonds. Section 17. Effective Date of Ordinance. This ordinance shall be effective upon its passage, approval, and thirty(30) days after publication. PASSED BY THE CITY COUNCIL this 2nd day of May, 2011. Bonnie I. Walton, City Clerk APPROVED BY THE MAYOR this 2nd day of May, 2011. -30- 04/12/11 ORDINANCE NO. Denis Law, Mayor Approved as to form: - Deanna Gregory Pacifica Law Group LLP Bond Counsel • Date of Publication: • • • -31- 04/12/11 ' 1 ORDINANCE NO. CERTIFICATE I, the undersigned, City Clerk of the City Council of the City of Renton, Washington (the "City"), DO HEREBY CERTIFY: 1. That the attached Ordinance is a true and correct copy of Ordinance No. of the City Council (the "Ordinance"), duly passed at a regular meeting thereof held on the 2nd day of May, 2011. 2. That said meeting was duly convened and held in all respects in accordance with law, and to the extent required by law, due and proper notice of such meeting was given;that a legal quorum was present throughout the meeting and a legally sufficient number'of members of the City Council voted in the proper manner for the passage of the Ordinance; that all other requirements and proceedings incident to the proper passage of the Ordinance have been duly fulfilled, carried out and otherwise observed; and that I am authorized to execute this certificate. IN WITNESS WHEREOF, I have hereunto set my hand this 2nd day of May, 2011. 04/12/11 RESOLUTION NO. 4088 A RESOLUTION OF THE,CITY OF RENTON, WASHINGTON DESIGNATING CERTAIN EXPENDITURES FOR POTENTIAL REIMBURSEMENT FROM BONDS OR OTHER OBLIGATIONS THAT MAY BE AUTHORIZED AND APPROVED FOR ISSUANCE BY THE CITY IN THE FUTURE. WHEREAS, the City of'Renton, Washington (the "City") intends to issue tax-exempt obligations from time to time for the purpose of financing its governmental activities; and WHEREAS, the United States Department of the Treasury has promulgated Regulations limiting the ability of the City to use the proceeds of tax-exempt obligations for reimbursement of prior expenditures; and WHEREAS, the Regulations require that a municipality declare its intent to issue tax- i I exempt bonds to reimburse the municipality for prior expenditures before the expenditures are incurred; I , NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON, DOES RESOLVE AS FOLLOWS: Section I. Pursuant to'U.S. Treasury Regulation Section 1.150-2(e), the City reasonably expects to reimburse the expenditures described herein with the proceeds of bonds or other obligations to be incurred by the City(the _'Reimbursement Bonds"). Section II. The expenditures with respect to which the City reasonably expects to be reimbursed from the proceeds of Reimbursement Bonds include the acquisition (including land), construction, improvement, and equipping of library facilities. Section III. The maximum principal amount of debt obligations expected to be issued for the projects described in Section II is $18,000,000. RESOLUTION NO. 4088 Section IV. The adoption of this resolution shall not obligate the City to issue the bonds. • The issuance of the bonds shall require separate and additional official approval by the City Council. PASSED BY THE CITY COUNCIL this 21st day of March , 2011. )66- .u-.� Bonnie I. Walton, City Clerk APPROVED BY THE MAYOR this 21st day of March , 2011. ILIU/tor Denis Law, Mayor Approved as to form: Deanna Gregory, on Co sel ; • (r) a.: • 2 P:120358_DG120358_0PK 03/22/11 March 21,2011 Renton City Council Minutes Page 77 UTILITIES COMMITTEE Utilities Committee Chair Zwicker presented a report recommending Latecomer Agreement: concurrence in the staff recommendation to grant Friedman Development, LLC Friedman Development,S 2nd final approval of a latecomer agreement for a period of 15 years for the St&S Tobin St, LA-05-001 purpose of recovering a portion of the cost of extending the water main along Williams Ave.S., between S.2nd St.and S.Tobin St. The application for latecomer agreement was submitted by Penhallegon Associates Consulting Engineers on behalf of Friedman Development, LLC on 6/18/2005,and the preliminary costs were approved by City Council. Construction of the project started 3/11/2005, and was completed 2/23/2007. City staff has received as- built plans, reviewed the final costs,and updated the assessment roll using the per-square-foot of property method and total cost of$282,112. The Committee further recommended that the final assessment roll be forwarded to the City Clerk,who will notify the affected property owners of the latecomer's potential assessment and the right to appeal, with Council retaining the right to rule on the final action. If no appeals have been submitted within 20 days of the date of mailing the assessment notice,the Mayor and City Clerk are authorized to execute and record the latecomer agreement to finalize the matter. MOVED BY ZWICKER,SECONDED BY PARKER,COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. RESOLUTIONS AND The following resolution was presented for reading and adoption: ORDINANCES RESOLUTION#4088 A resolution was read designating certain expenditures for potential Finance: Libraries Facilities reimbursement from bonds or other obligations that may be authorized and Reimbursement Bonds /4approved for issuance by the City in the future. MOVED BY PERSSON, Authorization Q (t SECONDED BY TAYLOR, COUNCIL ADOPT THE RESOLUTION AS READ. CARRIED. Data The following ordinance was presented for first reading and referred to the . 3/28/2011 Council meeting for second and final reading: Budget: 2011/2012 Carry An ordinance was read amending the Fiscal Years 2011/2012 Biennial Budget as Forward Ordinance adopted by Ordinance#5583, in the amount of$30,891,197,with the total amended budget to be$255,754,433 for 2011 and$475,686,433 for the biennium. MOVED BY PERSSON,SECONDED BY TAYLOR,COUNCIL REFER THE ORDINANCE FOR SECOND AND FINAL READING ON 3/28/2011. CARRIED. The following ordinances were presented for second and final reading: ORDINANCE#5593 An ordinance was read amending Title IX(Public Ways and Property),of City Community Services: Code, by adding a new Chapter 17,entitled "Encroachments on Public Encroachments on Public Property,"establishing the policy of prevention of encroachments on public Property property, establishing an appeal procedure for encroachment violation notices, levying costs to resolve, remove or correct an encroachment,establishing damages and value of use for an encroachment,allowing for use permits for public property,declaring an encroachment as a nuisance, and establishing that an encroachment violation may be an infraction or misdemeanor. MOVED BY • PALMER,SECONDED BY ZWICKER,COUNCIL ADOPT THE ORDINANCE AS READ. ROLL CALL. ALL AYES. CARRIED. • March 21,2011 Renton City Council Minutes Page 76 Transportation: Highlands to Transportation Systems Division recommended approval of a contract in the Landing Pedestrian amount of$135,938 with Otak, Inc.for design services for the Highlands to Connection,Otak Landing Pedestrian Connection project. Council concur. CAG: 10-157, NE 3rd/NE 4th St Transportation Systems Division recommended approval of Supplemental Improvements, Parametrix Agreement#1 to CAG-10-157,with Parametrix, Inc.,in the amount of $492,334.16 for design and right-of-way services for the NE 3rd/4th Corridor Improvements project. Refer to Transportation (Aviation) Committee. CAG-10-084, Union Ave NE/ Utilities Systems Division submitted CAG-10-084, Union Ave. NE/Duvall Ave. NE Duvall Ave NE Storm System Storm System Repair project; and requested approval of the project, Repair, Hoffman Construction authorization for final pay estimate in the amount of$737.50,commencement of a 60-day lien period,and release of retained amount of$4,919.48 to Hoffman Construction, Inc.,contractor, if all required releases are obtained. • Council concur. MOVED BY BRIERE,SECONDED BY ZWICKER,COUNCIL APPROVE THE CONSENT AGENDA AS PRESENTED. CARRIED. UNFINISHED BUSINESS Finance Committee Chair Persson presented a report recommending approval Finance Committee of Claim Vouchers 301417-301807 and two wire transfers totaling Finance:Vouchers $4,008,306.04,and approval of 731 direct deposits,61 payroll vouchers, and one wire transfer totaling$2,623,853.13. MOVED BY PERSSON,SECONDED BY TAYLOR,COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. Budget:2011/2012 Carry Finance Committee Chair Persson presented a report recommending Forward Ordinance concurrence in the staff recommendation to approve an amendment of the 2011 Budget appropriations in the amount of$30,891,197 with the total amended budget to be$255,754,433 for 2011 and $475,686,433 for the biennium. The Committee further recommended that the ordinance regarding this matter be presented for first reading. MOVED BY PERSSON,SECONDED BY TAYLOR, COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. (See page 77 for ordinance.) Finance: Libraries Facilities Finance Committee Chair Persson presented a report recommending Reimbursement Bonds concurrence in the staff recommendation to approve a resolution setting the Authorization intent and allowing the City to receive reimbursement from bonds proceeds for I� any advance payments for the development of the two new proposed libraries. 0 MOVED BY PERSSON,SECONDED BY TAYLOR, COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. (See page 77 for resolution.) Councilmember Persson clarified that the resolution will allow the City to reimburse'the General Fund through bonds for purchases related to library facilities and equipment made prior to the issuance of the bonds. • Transportation(Aviation) Transportation (Aviation)Committee Chair Corman presented a report Committee recommending concurrence in the staff recommendation to approve the Airport:Operating Permit& sublease between Bosair, LLC and Ace Aviation, Inc.,and authorize the Mayor Agreement,Ace Aviation; and City Clerk to sign the Operating Permit and Agreement with Ace Aviation, Sublease, Bosair, LLC Inc. MOVED BY CORMAN,SECONDED BY PALMER, COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. ' • - APPROVED BY - - FINANCE COMMITTEE - ' . ' CITY COUNCIL- - COMMITTEE REPORT Dae 31,1-ao/� • March 21,2011 : Authorized Reimbursement of City Costs from Bond Proceeds for Proposed New Library Development Bonds ' ' (Referred March 14, 2011) • • The Finance,Committee recommends concurrence in the staff recommendation.to approve a • . • ' ' resolution settingthe intent andallow the City to receive reimbursement from bond's proceeds for any advance payments for the,development of the two new proposed libraries. , . _ Don Pers on,Chair - . _ . Gr-g ,Vice CIS ir.•. _ King Parker, Member _ , - • cc: .lwen Wang,Finance&IT Administrator • • , March 14, 2011 Renton City Council Minutes Page 66 CED:2011 Neighborhood Community and Economic Development Department reported submission of Grant Program grant applications for the 2011 Neighborhood Grant Program and recommended funding 16 newsletters totaling$8,063. Refer to Community Seivices Committee. Budget: 2011/2012 Carry- Finance and Information Technology Department requested approval of the Forward Ordinance 2011/2012 carry-forward ordinance in the amount of$29,889,127, which • increases the 2011/2012 Budget by carrying forward funds from 2010 for projects that were not completed in 2010. Refer to Finance Committee. Finance: Libraries Facilities Finance and Information Technology Department requested authorization to Reimbursement Bondsreimburse certain capital expenditures from the proceeds of the sale of Authorization 1 d X1142-reimbursement bonds, related to the construction of new libraries,to be issued in the future. Refer to Finance Committee. Lease: Rainier Flight Services, Transportation Systems Division recommended approval of a building and Ground & Building ground lease with Rainier Flight Services, in the amount of$23,447.43 plus leasehold tax,to lease a portion of the 790 Building and 12,000 square feet of tiedown;space at the airport from 4/1/2011 to 3/31/2012. Refer to Transportation (Aviation) Committee. MOVED BY BRIERE,SECONDED BY PARKER, COUNCIL APPROVE THE CONSENT AGENDA AS PRESENTED. CARRIED. UNFINISHED BUSINESS Finance Committee Chair Persson presented a report recommending Finance Committee concurrence in the staff recommendation to approve the rental fee waiver in Finance: Carco Theater Rental the amount of$390 for Carco Theatre for Congressman Adam Smith to host a Fee Waiver,Smith Town Hall event in Renton for members of the public. MOVED BY PERSSON, SECONDED BY TAYLOR,COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. Community Services: Cedar Finance Committee Chair Persson presented a report recommending River Trail Trestle Bridge concurrence in the staff recommendation to proceed with a Time & Materials Repair, King County Road Discretionary Work Request under the interlocal agreement with King County, Services Division CAG-08-180,with a budget maximum of$170,000 to repair the trestle bridge along the Cedar River Trail at Maplewood Roadside Park. The Committee further recommended that the Mayor and City Clerk be authorized to execute the Discretionary Work Request. MOVED BY PERSSON,SECONDED BY TAYLOR, COUNCIL CONCUR IN THE COMMITTEE REPORT. CARRIED. CED:School Impact Fees Finance Committee Chair Persson presented a report regarding the collection of impact fees on behalf of the Renton School District. The Renton School District has demonstrated an effort to collect School Impact Fees from all jurisdictions they serve. Therefore,the Committee recommends concurrence with the staff recommendation and the Renton School District request to adopt an ordinance to continue to maintain the current impact fee of$6,310 for each new single-family home and $1,258 for each new multi-family unit on behalf of the Renton School District. The Committee further recommended that the ordinance regarding this matter be presented for first reading. This matter shall remain in Committee in order to receive updates on the school district's progress on securing impact fees in other jurisdictions. I i CITY OF RE'NTON COUNCIL AGENDA BILL Subject/Title: I Meeting: Proposed New Library Development Bo ds: Regular Council - 14 Mar 2011 Authorizing Reimbursement of City Costs from Bond Proceeds � Exhibits: Submitting Data: Dept/Div/Board: IRS Reimbursement Bond Guidelines i Finance & Information Technology Resolution I. - Staff Contact: Iwen Wang, Administrator Recommended Action: Refer to Finance Committee I Fiscal Impact: Expenditure Required: $ � Transfer Amendment: $ Amount Budgeted: $ Revenue Generated: $ Total Project Budget: $ I City Share Total Project: $ • SUMMARY OF ACTION: The City and King County Library System have begun the planning process for the development of the two new libraries. Under the IRS regulations, the City must indicate its intent to obtain reimbursement for costs paid beyond 60 days prior to the bond issuance. This Resolution will set out the intent and allow the City to receive reimbursement from bond proceeds for any advance payments for the development of these libraries. • STAFF RECOMMENDATION: Approve the proposed Resolution. • • SUMMARY OF INTERNAL REVENUE SERVICE REIMBURSEMENT BOND GUIDELINES Public Finance Department K&L Gates LLP INTRODUCTION If the rules described in this memorandum are followed, reimbursement bond proceeds will be treated as "spent" when they are allocated to reimburse an issuer or a private activity bond conduit borrower for prior capital expenditures. This will free-the reimbursement bond proceeds from federal tax rules such as the.arbitrage rebate requirements. These rules may apply to only a portion of a bond issue. Definition of Reimbursement Bond A reimbursement bond is the portion of a bond issue used to reimburse the issuer or conduit borrower for an original expenditure made before the reimbursement bonds are issued and paid from a source other than a reimbursement bond. • Short Summary • o The issuer or conduit borrower must declare official intent to issue bonds to reimburse itself not later than 60 days after payment of the original expenditure. o The issuer must declare official intent if the reimbursement bond is a private activity bond (other than a qualified 501(c)(3) bond, a qualified mortgage , bond, a qualified student loan bond or a qualified veterans' mortgage bond). For other types of bonds, either the issuer or the conduit borrower may declare official intent. o Reimbursement bond proceeds must be allocated to payment for the original expenditure within 18 months after the expenditure was paid or the financed property was placed in service (whichever is later), but in no event more than three years after the original expenditure was paid(these time limits are longer for certain under-$5 million bond issuers). o If the issuer qualifies for the arbitrage rebate exception for small governmental issuers that expect to issue $5,000,000 or less of bonds in the calendar year, reimbursement bond proceeds must be allocated to payment for the original expenditure within three years after the expenditure was paid or the financed property was placed in service (whichever is later). • o The expenditure financed with reimbursement bond proceeds must be a capital expenditure, an: issuance cost for the reimbursement bonds, an extraordinary working capital item, a grant, a qualified student loan or a qualified veterans' mortgage loan. o Certain de minimis preliminary expenditures may be paid earlier than 60 days before declaration of official intent, and the 18-month or three-year maximum reimbursement period does not apply to these items. Effective Date The new reimbursement rules apply to bonds issued after June 30, 1993. No Application to Certain Bonds The 60 day official intent declaration requirement and the timing of issuance of the reimbursement bonds do not apply to the smaller of $100,000 or five percent of the bond proceeds. Original expenditures up to this amount may be reimbursed with bond proceeds without following the reimbursement bond rules. Similarly, the 60 day official intent declaration requirement and the 18-month or three-year maximum reimbursement period does not apply to preliminary expenditures of up to 20% of the issue price of the reimbursement bonds. Preliminary expenditures include architectural, engineering, surveying, soil testing, reimbursement bond issuance, and similar costs that are incurred before commencement of acquisition, construction or rehabilitation of the financed property. Land acquisition, site preparation and other costs incident to commencement of construction do not constitute preliminary expenditures. PRELIMINARY REQUIREMENTS This section describes the requirements that bond issuers or conduit borrowers must meet within 60 days of paying any original expenditure that they intend to reimburse with tax-exempt bond proceeds. Official Intent Declaration Requirement The municipal issuer or ultimate borrower of the bond proceeds must declare "official intent" for the original expenditure within 60 days of paying the expenditure. This official intent may be made before any expenditures are paid. The points that must be covered in the official intent declaration are as follows: o The declaration of official intent may be made in any reasonable form including a resolution of the issuer, action of an authorized person or specific legislative authorization for a particular project. o The declaration of official intent must contain a general functional description 2 P:120358_1:G120358_0PL 03/08/11 of the project,property or program to be financed by the reimbursement bonds (for example, "school building renovation," "highway capital improvement program"). A project description is sufficient if it identifies, by name and functional purpose, the fund or account from which the original expenditure is paid (for example, "parks and recreation fund--recreational facility capital improvement program"). ° The declaration of official intent must state the maximum principal amount of debt expected to be issued(or incurred)for the project. Timing Requirement for Official Intent Declaration The issuer or the conduit borrower must declare its official intent within 60 days of making the original expenditure with respect to which it will issue reimbursement bonds. The official intent declaration may be adopted before any expenditures are made. Type of Property Requirement The expenditure to be reimbursed must be a"capital" expenditure. A capital expenditure is any cost of a type that is properly chargeable to a capital account (or would be so chargeable with a proper election)under general federal income tax principles. Most working capital cannot be financed with the proceeds of reimbursement bonds. Original expenditures for extraordinary, non-recurring items that are not customarily payable from current revenues, such as casualty losses or extraordinary legal judgments in amounts in excess of reasonable insurance coverage may be financed with reimbursement bond proceeds. In addition, costs of issuance of the reimbursement bonds may be financed as can grants, qualified student loans, qualified mortgage loans or qualified veterans' mortgage loans. Reasonableness Requirement On the date of adoption of the official intent declaration, the issuer or conduit borrower must have a reasonable expectation that it will reimburse the original expenditure with proceeds of the reimbursement bonds. Official intent declarations made as a matter of course or in amounts substantially in excess of the amounts expected to be necessary for the project are not reasonable. Similarly, a pattern of failing to reimburse original expenditures covered by official intent declarations is evidence of unreasonableness. REFINANCING RULES Rules prohibit reimbursement bond proceeds from being applied to pay principal or interest on an obligation that financed an original expenditure. Prior reimbursement bonds may be refunded if the prior reimbursement bonds met the reimbursement requirements in effect on the date they were issued. 3 P:120358 DG120358 0PL 03/08/11 BOND ISSUANCE REQUIREMENTS There are certain bond issuance and proceeds allocation requirements.that must be met atthe time of issuance of the reimbursement bonds. Timing Requirements for Reimbursement Bonds Reimbursement bonds must be issued and bond proceeds allocated to reimburse theissuer or conduit borrower not later than the date that is 18 months after: i - (a) the date the original expenditure was paid, or (b) the date that the project to be financed was placed in service. but in no event more than three years after the original expenditure was paid. In the case of governmental units with general taxing powers that expect to issue no more than $5 million of governmental bonds in the calendar year, reimbursement bonds that are not private activity bonds must be issued within three years of the date the original expenditure was paid or within three years after the property is placed iri service. Allocation Requirement In order for reimbursement bond proceeds to be treated as expended, the bond proceeds must be "allocated" to the expenditures on the books and records of the issuer or conduit borrower. The allocation must result in the bond proceeds being relieved from all restrictions or covenants contained in the bond documents and state law. An allocation made within 30 days of issuance of the reimbursement bonds may be treated as made on the date of issuance of the reimbursement bonds. An allocation is invalid and does not result inan expenditure of reimbursement bond proceeds if, within one year after the allocation, money corresponding to the proceeds of the reimbursement bonds allocated to the original expenditure are used to create a sinking fund, pledged fund or otherwise establish an account that has a nexus to the governmental purpose of .the reimbursement bonds resulting in the creation of replacement funds. Reasonable Changes to Project The rules allow reasonable deviations between the project descriptions contained in the intent resolutions and the actual projects financed by the reimbursement bond proceeds. The project actually financed must be reasonably related in function to the project described in the official intent declaration. (6/21/93) • . • 4 1.320358 DG120358 0PL 03/08/11 . RESOLUTION NO. A RESOLUTION OF THE CITY OF RENTON, WASHINGTON DESIGNATING CERTAIN EXPENDITURES FOR POTENTIAL REIMBURSEMENT FROM BONDS OR OTHER OBLIGATIONS THAT MAY BE AUTHORIZED AND APPROVED FOR ISSUANCE BY THE CITY IN THE FUTURE. WHEREAS, the City of Renton, Washington (the "City") intends to issue tax-exempt obligations from time to time for the purpose of financing its governmental activities; and WHEREAS, the United States Department of the Treasury has promulgated Regulations • limiting the ability of the City to use the proceeds of tax-exempt obligations for reimbursement of prior expenditures; and WHEREAS, the Regulations require that a municipality declare its intent to issue tax-exempt bonds to reimburse the municipality for prior expenditures before the expenditures are incurred; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON, DOES RESOLVE AS FOLLOWS: Section L Pursuant to U.S. Treasury Regulation Section 1.150-2(e), the City reasonably expects to reimburse the expenditures described herein with the proceeds of bonds or other obligations to be incurred by the City(the "Reimbursement Bonds"). Section IL The expenditures with respect to which the City reasonably expects to be reimbursed from the proceeds of Reimbursement Bonds include the acquisition (including land), construction, improvement, and equipping of library facilities. Section III. The maximum principal amount of debt obligations expected to be issued for the projects described in Section II is$18,000,000. Section IV. The adoption of this resolution shall not obligate the City to issue the bonds. The issuance of the bonds shall require separate and additional official approval by the City RESOLUTION NO. Council.. PASSED BY THE CITY COUNCIL this day of , 2011. Bonnie I. Walton, City Clerk APPROVED BY THE MAYOR this day of , 2011. Denis Law, Mayor Approved as to form: Deanna Gregory, Bond Counsel 2 P:120358 DG120358 0PK 03/08/11