HomeMy WebLinkAboutLimited Tax General Obligation Bond - Taxable Direct-Pay Qualified Energy Conservation Bond - 2013 ���,� �� �-�,.
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B NY M E L LO N The Bank of New York Mellon T 214 580 1220
Trust Company,N.A. F 214 580 3400
Corporate Trust
Representative Office
2001 Bryan Street,10th Floor
Dallas,TX 75201
October 2,2014
United Parcel Service Tracking Number: 1Z 6F1 3R1 01 9577 0724
Iwen Wang, Finance&Information Technology Administrator
City of Renton,Washington
1055 S. Grady Way
Renton,WA 98055
$3,200,000
City of Renton,Washington
Limited Tax General Obligation Bond,2013
(Taxable Direct-Pay Qualified Energy Conservation Bond)
Dear Mr.Wang:
In our role as Calculation Agent for your above referenced Direct Pay Bond issue,please see the attached
Form 8038-CP that will need to be reviewed,signed,and returned by October 22,2014 to:
The Bank of New York Mellon Trust Company
8038-CP Group
2001 Bryan Street, 10`b Floor
Dallas,Texas 75201
ATTN:Ms. Rachel Gonzalez
214 580-1232 or Te Burke at 214 580-1230
As a result of the sequestration process required by the Balanced Budget and Emergency Deficit Control
Act of 1985,as amended,the credit payment amount requested on the attached form will be reduced by
an amount equal to 7.2%of the requested subsidy payment effective October 1,2013. The IRS
announcement instructs issuers to submit the Form 8038-CP using 100%of the requested subsidy
payment. The IRS will then notify the issuer through correspondence of the amount the requested
payment is being reduced. The enclosed form does not need to be modified.
We recommend returning the si ned original form via overnight delivery for tracking purposes and so
that we can submit the required information to the IRS in a timely manner. Please retain a copy of the
signed form before returning the original to us.
Upon receipt of the signed original Form 8038-CP,BNY Mellon will submit it to the IRS. We will notify
you once we receive the IRS receipt confirmation. Please do not hesitate to contact Michelle Baldwin or
me if you have any questions regarding the attached form.
Sincerely,
%
�
Rachel Gonzalez
Vice President
�
� �
Fo�,8038-CP Return for Credit Payments
(Rev.January2012) to Issuers of Qualified Bonds OMBNo.1545-2142
Department of the Treasury
Intemal Revenue Service
Information on Entity That Is To Receive Payment of Credit and Communications Check box if Amended Retum►❑
1 Name of entity that is to receive payment of the credit 2 Employer identification number(EIN)
Cit of Renton,Washin on 91-6001271
3 Number and street(or P.O.box no.if mail is not delivered to street address) RoorNsuite
1055 South Grad Wa
4 City,town,w post office,state,and ZIP code
Renton,Washin on 98057
5 Name and title of designated contact person whom the IRS may cail for more information 6 Telephone number of officer or legal representative
Iwen Wan ,Finance&Infomation Technolo AdminisVator 425 430-6858
Reporting Authority
7 Issuer's name(f same as line 1,errter"SAME"and skip lines 8,9,11,15,and 16) 8 EIN
SAME
8 Number and street(or P.O.bo�c no.if mail is not delivered to street address) Room/suite 10 Report number(For IRS Use Only)
11 City,town,or post office,state,and ZIP code 12 Date of issue(MM/DD/YYY`�
07/01/2013
13 Name of issue 14 CUSIP number(see instructions)
Limited Tax General Obli ation Bond,2073 axable Direct-Pa QECB 760133 SZ2
15 Name and title of officer or other person whom the IRS may call for more information 76 Telephone number of officer or other person to call
17a Type of issue► For build America bonds and recovery zone economic development bonds,check the applicable box(see instructions)
❑Educational ❑Health and Hospital ❑Trans rtation ❑Public Safe ❑Environmental ❑Housin ❑Utilities ❑Other
b For build America bonds,recovery zone economic development bonds,and specified tax credit bonds,enter
the issue price. . . . . . . . . . . . . . . . . . . . . . . . . . . . ► 17b 3.200,000
� Check applicable box► ❑Variable rate bond ❑✓ Fixed rate bond
Payment of Credit (For specified tax credit bonds with multiple maturities,see instructions.)
18 Interest payment date to which this payment of credit relates(MM/DD/YY`!1� 01/01/2015
19a Interest payable to bondholders on the interest payment date . . . . . . . . 19a 48,139 00
b For specified tax credR bonds only,enter the applicable credit rate determined under Sec.54A(b)(3) ��,��o�
c For specified tax credit bonds only, enter the interest that would be payable to bondholders on the interest
payment date calculated using the applicable credit rate(see instructions) . . . . . . . . . . . �g� 67,275 00
20 Amount of credit payment to be received as of the interest payment date(complete only line 20a,20b,20c,20d,20e,or 20�
a Build America bonds.Multiply line 19a by 35% . . . . . . . . . . . . . . . . . . . 20a
b Recovery zone economic development bonds.Multiply line 19a by 45% . . . . . . . . . . . . 20b
c New clean renewable energy bonds enter the lesser of line 19a or 70%of line 19c . . . . . . . . . 20c
d Qualified energy conservation bonds enter the lesser of line 19a or 70%of line 19c . . . . . . . . 20d 47 092 50
e Qualified zone academy bonds enter the lesser of lines 19a or 19c . . . . . . . . . . . . . 20e
f Quaiified school construction bonds enter the lesser of lines 19a or 19c . . . . . . . . . . . . 20f
21 Adjustment to previous credft payments(complete line 21 a OR line 21 b only):
a Net increase to previous payments(attach explanation). . . . . . . . . . : . . . . . . 21a
b Net decrease to previous payments(attach explanation) . . . . . . . . . . . . . . . . 21 b
22 Amount of credft payment to be received.Combine either line 20a,20b,20c,20d,20e,or 20f with line 21 a or line 21 b. 22 47,092 50
23 Is this the final interest payment date? . . . . . . . . . . . . . . . . . . . . . . . . . Yes ❑ No 0✓
24 if the enUty identified in Part I is not the issuer,check this box . . . ►❑
. . . . . . . . . . . . . . . . . . .
Direct � Enter direct deposit information below:
Deposit a Routing number ►b Type:❑Checking ❑Savings
c Account number
Under penalties of perjury,1 declare that I have examined this retum,and accompanying schedules and statements,and to the best of my knowledge
$1 nature a^d belief,they are trve,correct,and complete.I turther declare tha[I suthorize the IRS to send the requested refundable credit payment to the entity
g identified in Part I,and I conserrt to the disclosure of th issuer's retum information, as necessary to process the refundable credit paymerrt,to the
and designated coMact person(s)list ove i ts I applicable.
Consent �� � ► � �'►��i r I'���NA �I(��it1,S�a�
'Signature of issuer D rfype or rint name and title
PrinVType preparer's name ' i nature Date PTIN
Paid Check � if
Preparer �Ose hine R.Gonzalez self-employed p01326858
Use Only �'R"�s name ► The Bank of New York M 1 n T st Com an , . Fi 's EIN ► 95-3571558
Firm's address ► 2001 B an SVee 10th lo f Ilas TX 75201 Phone no. 214 580-1232
For Paperwork Reduction Act Notice,see the separate in tructions. C .No 528 E Form 8038-CP(Rev.1-2012)
� �
CITY OF RENTON, WASHtNGTON
LIMITED TAX GENERAL OBLIGATION BOND, 2013
(TAXABLE DIRECT-PAY QUALIFIED ENERGY CONSERVATION BOND)
ORDINANCE N0. 5691
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON, AUTHORIZING THE ISSUANCE AND SALE OF A
LIMITED TAX GENERAL OBLIGATION BOND OF THE CITY IN THE
PRINCIPAL AMOUNT OF NOT TO EXCEED $3,200,000 FOR THE
PURPOSE OF FINANCING STREETLIGHT IMPROVEMENTS AS PART
OF A GREEN COMMUNITY PROGRAM; PROVIDING THE FORM OF
THE BOND; AND AUTHORIZING THE SALE OF THE BOND.
Passed May 20, 2013
PREPARED BY:
. PaciFiCa Law GRouP LLP
Seattle, Washington
� �
CITY OF RENTON
ORDINANCE N0. 5691
TABLE OF CONTENTS*
Pa�e
Section 1. Definitions and Interpretation of Terms.................................................................2
Section 2. Authorization of the Project....................................................................................5
Section 3. Authorization of the Bond.......................................................................................5
Section 4. Registration, Exchange and Payments ....................................................................5
Section5. Form of Bond ...........................................................................................................7
Section6. Execution of Bond..................................................................................................10
Section 7. Application of Bond Proceeds ...............................................................................11
Section8. Tax Covenants........................................................................................................11
Section 9. Pledge of Funds and Credit; General Obligation...................................................12
Section 10. Prepayment and Redemption ...............................................................................13
Section11. Sale of the Bond.....................................................................................................15
Section 12. Ongoing Disclosure; Covenants.............................................................................15
Section 13. Lost, Stolen or Destroyed Bond.............................................................................16
Section 14. Severability; Ratification........................................................................................16
Section 15. Effective Date of Ordinance...................................................................................17
Exhibit A: Proposal
Exhibit B: Form of Purchaser's Letter
* This Table of Contents is provided for convenience only and is not a part of this ordinance.
� `�
CITY OF RENTON, WASHINGTON
ORDINANCE NO. 5691
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON, AUTHORIZING THE ISSUANCE AND SALE OF A
LIMITED TAX GENERAL OBLIGATION BOND OF THE CITY IN THE
PRINCIPAL AMOUNT OF NOT TO EXCEED $3,200,000 FOR THE
PURPOSE OF FINANCING STREETLIGHT IMPROVEMENTS AS PART
OF A GREEN COMMUNITY PROGRAM; PROVIDING THE FORM OF
THE BOND;AND AUTHORIZING THE SALE OF THE BOND.
WHEREAS, the City Council (the "Council") of the City of Renton, Washington (the
"City"), has determined that it is in the best interest of the City that the City adopt a program
to finance capital expenditures to improve certain existing public streetlights located
throughout the City in order to promote energy conservation and efficiency for the benefit of
the general public (the "Program"); and
WHEREAS, Section 54D of the Internal Revenue Code of 1986, as amended (the
"Code"), authorizes the issuance of "Qualified Energy Conservation Bonds" for capital
expenditures incurred for "qualified conservation purposes," including but not limited to
implementing a green community program under Section 54D(f)(1)(A�(ii) of the Code; and
WHEREAS, the City has received from the Washington State Department of Commerce
a reallocation of up to $3,200,000 of Qualified Energy Conservation Bond volume cap for
purposes of implementing the Program; and
WHEREAS, it is in the best interest of the City to issue a limited general obligation bond
in the principaf amount of not to exceed $3,200,000 (the "Bond") to finance costs of
implementing the Program, including financing costs related to replacing existing high-
pressure-sodium luminaries with light emitting diode luminaries (the "Project"); and
�'" ORDINANCE NO. 5691 �
WHEREAS, the Bond authorized herein shall be sold as a Qualified Energy Conservation
Bond to PHL Variable Insurance Company, an affiliate of Phoenix Life Insurance Company (the
"Purchaser") pursuant to the purchase offer set forth in Exhibit A attached hereto (the
"Proposal"), as herein provided; and
WHEREAS, it is deemed advisable that the City accept the Purchaser's offer and issue
the Bond as set forth herein;
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:
Bond means the Limited Tax General Obligation Bond, 2013 (Taxable Direct-Pay
Qualified Energy Conservation Bond) authorized to be issued by the City pursuant to this
ordinance.
Bond Counsel means Pacifica Law Group LLP, Seattle, Washington.
Bond Fund means the "Bond Redemption Fund" authorized to be created pursuant to
Section 9 of this ordinance.
Bond Register means the registration records for the Bond maintained by the Bond
Registrar.
Bond Registrar means the fiscal agency of the state of Washington, currently The Bank
of New York Mellon.
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'�' ORDINANCE N0. 5691 `"'�+'''
City means the City of Renton, Washington, a municipal corporation duly organized and
existing under the laws of the State of Washington.
City Council or Council means the City Council of the City as the general legislative
authority of the City, as the same shall be duly and regularly constituted from time to time.
Code means the Internal Revenue Code of 1986, as amended, and shall include all
applicable regulations and rulings relating thereto.
Federal Tax Certificate means the certificate regarding the status of the Bonds as
Qualified Energy Conservation Bonds under Section 54D of the Code.
Finance Director means the City's Finance and Infarmation Services Administrator or
the successor to such officer.
Interest Rate means the rate of interest set forth in Section 11.
Program means the program of the City to finance capital expenditures to improve
certain existing public streetlights located throughout the City in order to promote energy
conservation and efficiency throughout the City for the benefit of the general public.
P�oject means the project described in Section 2 of this ordinance.
Project Fund means the "2013 LTGO Project Fund" authorized to be created pursuant
to Section 7 of this ordinance.
Proposal means the commitment letter submitted by Phoenix Life Insurance Company
substantially in the form attached hereto as Exhibit A.
Purchaser means PHL Variable Insurance Company, a Connecticut insurance company
and an affiliate of Phoenix Life Insurance Company.
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'�'` ORDINANCE NO. 5691 `�'
Registered Owner means the person in whose name the Bond is registered on the Bond
Register.
Rule means the Securities and Exchange Commission's Rule 15c2-12 under the
Securities Exchange Act of 1934, as the same may be amended from time to time.
(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), limited liability companies, 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.
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`� ORDINANCE NO. 5691 �
Section 2. Authorization of the Proiect. The Bond is being issued to finance costs of
implementing the Program, including capital improvements related to replacing existing high-
pressure luminaries with light emitting diode luminaries (the "Project"). Any remaining costs of
the Project shall be paid from other City funds legally available for such purpose.
Section 3. Authorization of the Bond. For the purpose of financing costs of the
Project and paying costs of issuance of the Bond, the City hereby authorizes the issuance and
sale of the Bond in the principal amount of not to exceed $3,200,000. The Bond shall be
designated the "City of Renton, Washington, Limited Tax General Obligation Bond, 2013
(Taxable Direct-Pay Qualified Energy Conservation Bond)," or other such designation as set
forth in the Bond and approved by the Finance Director.
The Bond shall be dated as of its date of delivery, shall be fully registered as to both
principal and interest, shall be in one denomination, and shall mature on July 1, 2028. The
Bond shall bear interest from its dated date or the most recent date to which interest has been
paid at the Interest Rate. Interest on the principal amount of the Bond shall be calculated per
annum on a 30/360 basis, or as otherwise provided in the Bond. Principal shall be payable
annually beginning July 1, 2014 until maturity or prior redemption as set forth in the payment
schedule attached to the Bond. Interest on the Bond shall be payable semiannually on the first
days of January 1 and luly 1 as set forth in the payment schedule attached to the Bond.
Section 4. Registration, Exchan�e and Pavments.
(a) Regisrrar/Bond Registror/Poying Agent. The Bank of New York Mellon, as fiscal
agency of the state of Washington, is hereby appointed to act as transfer agent, paying agent
and registrar for the Bond (the "Bond Registrar").
�5- OS/21/13
� ORDINANCE NO. 5691 "'�
(b) Registered Ownership. The Bond Registrar shall keep, or cause to be kept, at the
office of the Finance Director, sufficient records for the registration and transfer of the Bond.
The Bond Registrar is authorized, on behalf of the City, to authenticate and deliver the Bond in
accordance with the provisions of the Bond and this ordinance to serve as the City's paying
agent for the Bond and to carry out all of the Bond Registrar's powers and duties under this
ordinance.
(c) Transfer or Exchonge of Registered Ownership. The Bond shall not be
transferable without the consent of the City unless (i) the Purchaser's corporate name is
changed and the transfer is necessary to reflect such change; (ii) the transferee is a successor in
interest of the Purchaser by means of a corporate merger, an exchange of stock, or a sale of
assets; or (iii) the transferee is a "qualified institutional buyer" as defined under Rule 144A
promulgated under the Securities Act of 1933 and such transferee executes a purchaser letter
substantially in the form attached hereto as Exhibit B. Every Bond presented or surrendered
for transfer or exchange shall contain, or be accompanied by, all necessary endorsements for
transfer. Any transfer of the Bond which fails to comply with this provision shall be null and
void.
(d) Registration Covenont. The City covenants that, until the Bond has been
surrendered and canceled, it will maintain a system for recording the ownership of the Bond
that complies with the provisions of Section 149 of the Code.
(e) Ptoce and Medium of Payment. Both principal of and interest on the Bond shall
be payable in lawful money of the United States of America without surrender or presentation,
by wire transfer or Automated Clearinghouse (ACH) transfer if requested by the owner of the
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�+ ORDINANCE NO. 5691 w�
Bond. Notwithstanding the foregoing, upon final payment of all principal and interest thereon,
the Bond shall be submitted to the Bond Registrar for cancellation and surrender.
The Bond Register shall be maintained by the Bond Registrar, and shall contain the
name and mailing address of the registered owner of the Bond or nominee of such registered
owner.
Section 5. Form of Bond. The Bond shall be in substantially the following form:
UNITED STATES OF AMERICA
NO. R-1 $
STATE OF WASHINGTON
CITY OF RENTON
LIMITED TAX GENERAL OBLIGATION BOND, 2013
(TAXABLE DIRECT-PAY QUALIFIED ENERGY CONSERVATION BOND)
INTEREST RATE: 3.22%
MATURITY DATE: JULY 1, 2028
REGISTERED OWNER: PHL VARIABLE INSURANCE COMPANY
PRINCIPAL AMOUNT: AND NO/100 DOLLARS
The City of Renton, Washington, a municipal corporation organized and existing under
and by virtue of the taws of the State of Washington (the "City"), hereby acknowledges itself to
owe and for value received promises to pay to the Registered Owner identified above, on or
before the Maturity Date identified above, the Principal Amount identified above. This bond
shall bear interest at the fixed rate stated above (the "Interest Rate"}. Interest on this bond
shall accrue from its dated date until paid and shall be computed per annum on the principal
amount outstanding on a 30/360 basis. Accrued interest on this bond shall be payable
semiannually on the dates set forth in the payment schedute attached hereto. Principal shall
be payable annuatly on the dates set forth in the payment schedule attached hereto, unless
previously redeemed prior to maturity.
Both principal of and interest on this bond shall be payable in lawful money of the
United States of America. Principal and interest on this bond shall be payable by check or
warrant or by other means mutually acceptable to the Registered Owner and the City. Upon
final payment of principal and interest of this bond, the Registered Owner shall surrender this
bond for cancellation at the ofFice of the Bond Registrar in accordance with Ordinance No.
of the City (the "Bond Ordinance").
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�'' ORDINANCE NO. 5691 �
This bond is issued pursuant to the Bond Ordinance to finance costs related to
implementing a green community program of the City, including streetlight improvements, and
to pay costs of issuance. Capitalized terms used in this bond have the meanings given such
terms in the Bond Ordinance.
The City may prepay and redeem this bond prior to maturity as provided in the Bond
Ordinance.
This bond has not been designated as a "qualified tax-exempt obligation" within the
meaning of Section 265(b) of the Code.
The City has in the Bond Ordinance authorized the creation of a fund to be used for the
payment of debt service on this bond, designated as the "Bond Redemption Fund" (the "Bond
Fund"). The Bond Fund shall be drawn upon for the sole purpose of paying the principal of and
interest on this bond.
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.
This bond shall not be valid or become obligatory for any purpose or be entit{ed 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 issued pursuant to the Constitution and laws of the State of Washington,
and duly adopted ordinances of the City. This bond is transferable upon compliance with the
conditions set forth in the Bond Ordinance. Any transfer of this bond which fails to comply with
the terms of the Bond Ordinance shall be null and void.
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 exist, have happened, been done and performed
and that the issuance of this bond does not violate any constitutional, statutory or other
limitation upon the amount of 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 signature of the Mayor of the City Council and attested by
the manual or facsimile signature of the Clerk, as of this day of , 2013.
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'� ORDINANCE NO. 5691 �✓`
[SEAL] CITY OF RENTON, WASHINGTON
BY /s/
Mayor
ATTEST:
/s/
City Clerk
REGISTRATION CERTIFICATE
This bond is registered in the name of the Registered Owner on the books of the City, in
the office of The Bank of New York Mellon, as bond registrar (the "Bond Registrar"}, as to both
principal and interest, as noted in the registration blank below. All payments of principal of
and interest on this Bond shall be made by the City with full acquittance by the Bond
Registrar's wire transfer, made payable to the last Registered Owner as shown hereon and on
the registration books of the Bond Registrar at his/her/its address noted hereon and on the
registration books of the Bond Registrar.
Date of Name and Address of Signature of
Registration Registered Owner Bond Registrar
July_, 2013 PHL Variable Insurance Company
One America Row Bond Registrar
Hartford, CT 06102-5056
PAYMENT SCHEDULE
Principal and interest on this bond shall be payable as set forth in the following
schedule:
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`'�'' ORDINANCE NO. 5691 �
Date Principal Interest Total Payment
Section 6. Execution of Bond. The Bond shall be executed on behalf of the City with
the manual or facsimile signature of the Mayor, and shall be attested by the manual or
facsimile signature of the Clerk.
The executed Bond shall be delivered to the Bond Registrar for authentication. The
Bond shall be numbered R-1 and with any additional designation as the Bond Registrar deems
necessary for purposes of identification. Only a bond that bears a Certificate of Registration
substantially in the form set forth herein and manually executed by an authorized
representative of 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 Bond so authenticated have been duly executed, authenticated and delivered
hereunder and are entitled to the benefits of this ordinance. Such Bond bearing the Certificate
of Authentication shall be delivered to the Purchaser as set forth in Section 11.
In case either of the officers who shall have executed the Bond shall cease to be an
ofFicer or officers of the City before the Bond so signed shall have been authenticated or
delivered by the Bond Registrar, or issued by the City, such Bond may nevertheless be
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`�►' ORDINANCE NO. 5691 �
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. The Bond may also be signed and attested on behalf of the City by such
persons who at the date of the actual execution of the Bond, are the proper officers of the City,
although at the originaf date of such Bond any such person shall not have been such officer of
the City.
Section 7. Application of Bond Proceeds. The City shall establish a fund designated
the "2013 LTGO Project Fund" (the "Project Fund") into which the proceeds of the Bond shall
be deposited. Money in the Project Fund shall be used to pay the costs of the Project and
costs of issuance for the Bond. 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. Money remaining in the Project Fund after al) costs of the Project and costs
of issuance for the Bond have been paid shall be pledged to payment of the Bond and
deposited in the Bond Fund for such purpose.
Section 8. Tax Covenants. The City hereby designates the Program as a "green
community program" for purposes of Section 54D(f)(1)(A)(ii) of the Code. The City reasonably
expects that implementation of the Program will promote energy conservation and efficiency
for the benefit of the general public.
The City hereby makes an irrevocable designation under Section 54D of the Code that
the Bond be issued and sold as a "Qualified Energy Conservation Bond." The City makes a
further irrevocable designation to have Section 6431(f)(3)(B) of the Code apply to the Bond,
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'�'` ORDINANCE NO. 5691 `'�`
with the effect that the Bond will be issued and sold as a direct payment tax credit bond as set
forth in the Federal Tax Certificate.
The City shall comply with the provisions of this section unless, in the written opinion of
Bond Counsel to the City, such compliance is not required to maintain the exemption of the
interest on the Bond from federal income taxation.
The City hereby covenants that it will comply with the covenants set forth in the Federal
Tax Certificate. The City shall take such additional actions as are required to qualify such Bond
as a Qualified Energy Conservation Bond, to maintain such qualification, and to seek
reimbursement of the applicable federal subsidy in the future on a timely basis.
The City has not designated the Bond as a "qualified tax-exempt obligation" within the
meaning of Section 265(b) of the Code.
Section 9. Pled�e of Funds and Credit; General Obii�ation. The City hereby
authorizes the creation of a fund to be used for the payment of debt service on the Bond,
designated as the "Bond Redemption Fund" (the "Bond Fund"). No later than the date each
payment of principal of or interest or premium, if any, on the Bond becomes due,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, premium, if any, or interest. Money in the
Bond Fund may be invested in legal investments for City funds.
The City hereby irrevocably covenants and agrees for as long as the Bond is 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
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�' ORDINANCE NO. 5691 `+�
other revenues and money of the City legally available for such purposes, to pay the principal
of and interest on the Bond when due.
The City hereby irrevocably pledges that the annual tax provided for herein to be levied
for the payment of such principat, premium, if any, 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, premium, if any, and interest on the Bond will be and is hereby irrevocably set aside,
pledged and appropriated for the payment of the principal of, premium, if any, and interest on
the Bond. The fult 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,
premium, if any, and interest on the Bond when due.
Section 10. Prepayment and Redemption. If the Bond is prepaid in accordance with
this Section 10, interest shall cease to accrue on the date the Purchaser receives such
prepayment.
(a) Optional Redemption. Subject to the extraordinary redemption provisions
below, the Bond may be prepaid, at the option of the City, in whole or in part, on any date at a
price equal to the Make Whole Amount. For purposes of this Section, the "Make Whole
Amount" is the excess, if any, of (1) the sum of the present values (determined as of the date
of prepayment) of all remaining scheduled payments of principal and interest on the Bond
from the date of prepayment to the maturity date, discounted at a rate equal to the yield on
the interpolated US Treasury obligation having a weighted average equivalent to that of the
-13- osr2ins
`�"' ORDINANCE NO. 5691 `�
Bond at the time of prepayment plus 50 basis points, over (2) the principal amount of the Bond
being prepaid.
(b) Extraordinary Optional Redemption.
(1) The Bond may be redeemed, at the option of the City, prior to maturity
at any time at a price of par, pfus accrued interest, to the date of redemption upon the
occurrence of an "Extraordinary Event." For purposes of this Section, an "Extraordinary Event"
will have occurred if the City determines that a material adverse change has occurred to
Sections 54A, 54D, or 5431 of the Code, or if there is any guidance published by the Internal
Revenue Service ("IRS") or the United States Department of the Treasury (the "Treasury") with
respect to such sections or any other determination by the IRS or Treasury, which
determination is not the resutt of any act or omission by the City to satisfy the requirements to
qualify to receive the federal credit payments related to the Bond, pursuant to which the City's
federal credit payments are reduced or eliminated.
(2) The Bond may be redeemed, at the option of the City, at any time on or
after July 1, 2016, at a price of par, plus accrued interest to the date of redemption, in the
event that one or more of the federal credit payments related to the Bond is reduced (as a
result of sequestration or otherwise) from an amount equal to 70 percent of the interest
calculated at the tax credit rate published by Treasury on the dated date of the Bond to the
equivalent of 35 pe�cent or less.
(c) Extraordinary Mandatory Redemption. The Bond is subject to extraordinary
mandatory redemption, in whole or in part, on a date no later than three years after the date
of issuance of the Bond, or, in the event of an extension negotiated with the IRS, on any date
-�4- 05121/13
'w�r ORDINANCE NO. 5691 �+
not later than 90 days after the end of such extension period, at a redemption price equal to
the principal amount of the Bond called for redemption plus accrued interest, in an amount
equal to the unexpended proceeds of the sale of the Bond held by the City, but only to the
extent that the City fails to expend all of the proceeds of the Bond within three years of
issuance thereof and no extension of the period for expenditures has been granted by the IRS.
Section 11. Sale of the Bond. The Bond shall be sold to the Purchaser pursuant to
the terms of this ordinance and the Proposal. The Finance Director is hereby authorized to
approve the final principal amount of the Bond and to agree to any other terms, conditions and
co.venants that are in the best interest of the City and in accordance with the Proposal so long
as the principal amount of the Bond does not exceed $3,200,000.
The Interest Rate for the Bond, as determined on May 15, 2013 (the "Sale Date"), shall
be 3.22% per annum. The Council hereby accepts the Proposal, approves the Interest Rate for
the Bond, and ratifies and confirms execution of the purchase letter dated as of the Sale Date
(the "Purchase Agreement") by the Finance Director and delivery of the Purchase Agreement
to the Purchaser. Such Purchase Agreement shall be considered in full force and effect as of
the Sale Date.
The appropriate City officials, including but not limited to the Mayor, the Chief
Administrative Officer, and the Finance Director, are hereby authorized and directed to do
everything necessary for the prompt issuance, execution and delivery of the Bond and for the
proper application and use of the proceeds thereof.
Section 12. On�oin� Disclosure; Covenants.
-15- osrz,ns
�"" ORDINANCE NO. 5691 �
(a) Ongoing Disclosure. The Bond is exempt from ongoing disclosure requirements
of the Rule.
(b) Covenants. So long as the Bond is outstanding, the City hereby covenants and
agrees as follows:
(1) To provide the Purchaser copies of the City's audited financial
statements promptly after such statements become available; and
(2) To provide the Purchaser financial or other information as may be
reasonably requested in writing from time to time.
Section 13. Lost Stolen or Destroyed Bond. In case the Bond shall be lost, stolen or
destroyed while in the Registered Owner's possession, the Bond Registrar may at the request
of the Registered Owner execute and deliver a new Bond 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 its filing with the City written
certification that such Bond was actually lost, stolen or destroyed and of its ownership thereof.
In the case the Bond shall be lost, stolen, or destroyed while in the Registered Owner's
possession, the Registered Owner may elect upon final payment of principal and interest of the
Bond to surrender a photocopy of the Bond for cancellation at the office of the Bond Registrar
together with written certification that such Bond was actually lost, stolen or destroyed and of
its ownership thereof.
Section 14. 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
-16- 05�,�,3
, "�'` ORDINANCE N0. 5691 "�
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 Bond. All acts taken pursuant to the
authority granted in this ordinance but prior to its effective date are hereby ratified and
confirmed.
Section 15. 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 May, 2013.
�G. Gl�Gz�.c.p-���
Bonnie I. Walton, City Clerk
APPROVED BY THE MAYOR this 20th day of May, 2013.
��
Denis Law, Mayor
Approved as to form: ,��� ' "
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Paci ica Law Group LL �Y�� . �
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Bond Counsel �l�-;'�._ , _
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5/24/2013 Summar Y '
Date of Publication: � y) _ ; ';,;�-� - �,:
-1�- osizai a
� �
ORDINANCE NO. 5691 '
Exhibit A
Proposal
(attached)
A-1
� � �RDINANCE NO. 5691 ��
� Exhibit B
Form of Purchaser's Letter
City of Renton
Renton, Washington
RE: City of Renton, Washington, Limited Tax General Obligation Bond, 2013 (Taxable
Direct-Pay Qualified Energy Conservation Bond) (the "Bond")
Ladies and Gentlemen:
The undersigned, (the "Purchaser'), hereby
acknowledges receipt of the above-referenced Bond dated )uly _, 2013, originally issued in
the principal amount of$3,200,000. The undersigned acknowledges that the Bond was issued
pursuant to Bond Ordinance No. of the City of Renton (the "City.") adopted by the City
Council on May 20, 2013 (the "Bond Ordinance"). Proceeds of the Bond were used to finance
costs related to implementing a green community program of the City, including streetlight
improvements, and to pay costs of issuance. Capitalized terms used in this letter have the
meanings given such terms in the Bond Ordinance.
In connection with the acquisition of the Bond by the Purchaser, the Purchaser hereby
makes the following representations upon which you may rely:
1. The Purchaser is a "qualified institutional buyer' as defined under Rule 144A
promulgated under the Securities Act of 1933 (the "Act").
2. The Purchaser has sufficient knowledge and experience in financial and business
matters, including purchase and ownership of governmental obligations, to be able to evaluate
the risks and merits of the loan represented by its purchase of the Bond, and its net worth and
available assets are such that it is able to bear the economic risk of its purchase of the Bond.
3. The Purchaser understands that the Bond is a limited tax general obligation of
the City. Pursuant to the Bond Ordinance the City has irrevocably covenanted and agreed 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 the Bond as the same shall become due. The full faith, credit and resources
of the City have been irrevocably pledged for the annual levy and collection of such taxes and
the prompt payment of such principal and interest. The Purchaser acknowledges that no
property, debt service reserves, credit enhancement, or other security has been pledged to the
payment of principal of and interest on the Bond.
B-1
� ORDINANCE NO. 5691 � �
4. The Purchaser understands that no official statement, prospectus, offering
circular or other offering statement containing material information with respect to the City or
the Bond is being issued, that the Bond is unrated, and that, with due diligence, it has made its
own inquiry and analysis with respect to the City, the Bond and the security therefor, and other
material factors affecting the security for and payment of the Bond, and is relying solely on
such inquiry and analysis in its purchase of the Bond.
5. The Purchaser understands that the interest on the Bond is not excludable from
gross income for federal income tax purposes; i.e., the Bond is "taxable."
6. The Purchaser acknowledges that it has either been supplied with or been given
access to information, including financial statements and other financial information, to which
a reasonable investor would attach significance in making investment decisions, and the
Purchaser has had the opportunity to ask questions and receive answers from knowledgeable
individuals and organizations concerning the City, the Project, the use of proceeds of the Bond
and the Bond and the security therefor so that, as a reasonable investor, the Purchaser has
been able to make its decision to purchase the Bond.
7. The Purchaser acknowledges that it is purchasing the Bond for investment for
our own account and not with a present view toward resale or the distribution thereof, in that
it does not now intend to resell or otherwise dispose of all or any part of its interests in the
Bond. The Purchaser acknowledges that the Bond shall not be transferable without the
consent of the City unless (i) the Purchaser's corporate name is changed and the transfer is
necessary to reflect such change; (ii) the transferee is a successor in interest of the Purchaser
by means of a corporate merger, an exchange of stock, or a sale of assets; or (iii) the transferee
is a "qualified institutional buyer' as defined under Rule 144A promulgated under the
Securities Act of 1933 and such transferee executes a purchaser's letter substantially similar to
this letter. The Purchaser also acknowledges that any transfer of the Bond which fails to
comply with this provision and the transfer limitations on the Bond contained in the Bond '
Ordinance shall be null and void.
8. The Purchaser understands that the Bond is an exempted security under the Act
and that registration is not legally required as of the date hereof; and further understands that
the Bond (a) is not being registered or otherwise qualified for sale under the "Blue Sky" laws
and regulations of any state, (b) will not be listed in any stock or other securities exchange,
(c) will not carry a rating from any rating agency and (d) will be issued only in one
denominations of$3,200,000, which may not be readily marketable.
B-2- Q5/21/13
� � ORDINANCE NO. 5691 ��
9. The Purchaser has had the opportunity to consult with and be advised by legal
counsel as to the significance of this letter and it has satisfied itself that the Bond is a lawful
investment for it under all applicable laws.
Very truly yours,
[PURCHASER]
By:
Authorized Signatory
cc: The Bank of New York Mellon, Bond Registrar and Paying Agent
B-3- osrzv,s
� ORDINANCE N0. 5691 � �
CERTIFICATE
I, the undersigned, the Clerk of the City Council (the "City Council") of City of Renton,
Washington (herein called the "City"), DO HEREBY CERTIFY:
1. That the attached ordinance numbered (herein called the
"Ordinance") is a true and correct copy of an ordinance of the City, as finally adopted at a
regular meeting of the City Council held on the 20th day of May, 2013, and duty recorded in my
office.
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 such meeting was given; that
a quorum of the City Council was present throughout the meeting and a legally sufficient
number of inembers of the City Council voted in the proper manner for the passage of said
Ordinance; that all other requirements and proceedings incident to the proper adoption of said
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 May, 2Q13.
Bonnie I. Walton, City Clerk
05f21l13
May 20, 2013 � Renton City Council Minutes � Page 167
ORDINANCE#5690 An ordinance was read amending Section 4-1-160, of Chapter 1,Administration
CED:School Impact Fees and Enforcement,of Title IV(Development Regulations), of City Code,adding a
Waiver, Payment Under new Subsection 4-1-160.E.4., Regarding School Impact Fees Waiver, Payment
Protest&Appeals Under Protest, and Appeals. MOVED BY BRIERE,SECONDED BY ZWICKER,
COUNCIL ADOPT THE ORDINANCE AS READ. ROLL CALL. ALL AYES. CARRIED.
ORDINANCE#5691 An ordinance was read authorizing the issuance and sale of a Limited Tax
Finance: QECB Bond, General Obligation (LTGO) bond of the City of Renton in the principal amount of
Streetlight Replacement �f / not to exceed$3,200,000 for the purpose of financing streetlight
,J ��(/�P improvements as part of a Green Community Program; providing the form of
�Od��� the bond; and authorizing the sale of the bond. MOVED BY BRIERE, SECONDED
BY ZWICKER,COUNCIL ADOPT THE ORDINANCE AS READ. ROLL CALL. ALL
AYES. CARRIED.
NEW BUSINESS Councilmember Palmer invited everyone to attend the City's Memorial Day
Community Event: Memorial event scheduled for Monday, May 27, at 1 p.m.at Veteran's Memorial Park,
Day Event located on the corner of S. 3rd St. and Main Ave. S. Mr. Covington added that
the event is coordinated by VFW Post 1263, and it will include a wreath laying
ceremony to honor all five branches of military service. He encouraged
everyone to attend the event to honor veterans who have served both at home
and abroad, and especially for those who have fallen in the line of duty.
Council President Corman remarked that there are plenty of inemorial tiles left,
and asked how someone would go about getting a tile engraved.
Mayor Law remarked that citizens can contact the City, and information
regarding the process will be distributed at the Memorial Day event. He also
remarked that the City is currently repairing some of the memorial tiles, and
the administration will brief Council on this topic at the next Council meeting.
Community Event: Meadow Councilmember Persson announced that there is a fundraising event scheduled
Crest Playground Fundraising for Friday,June 7,from 5:30 p.m.to 8:30 p.m. at the Renton Community
Event Center. He stated that there will be a presentation by Tony Ventrella,and the
goal is to raise money to help close the$100,000 funding gap needed to add a
couple pieces of optional play equipment at the Meadow Crest Accessible
Playground. He stated that the event is free to attend, but encouraged
everyone to pre-register by calling 425-430-6700 or by signing up on the City's
website.
Community Event: Kiwanis Mayor Law remarked that on Saturday, May 18,50 volunteers from local
Park Clean-up Event churches and high schools did a tremendous job pruning, weeding, and
cleaning up Kiwanis Park. He stated that these local partnerships along with
dedicated City employees really make a difference in the community.
AUDIENCE COMMENT Audrey Adams(Renton) remarked that the public comment period during
Citizen Comment:Adams— Council meetings may not be the best forum for voicing her concerns about
Water Fluoridation water fluoridation,and asked for help in determining key people and
organizations in the community to contact. Ms.Adams also stated that she will
contact the Council Liaison to schedule appointments with individual
Councilmembers to discuss a recent study on this issue.
��'�`v .
� � � �
,� �,
From: Iwen Wang
Sent: Monday, May 20, 2013 4:52 PM
To: ORG CITY COUNCIL
Cc: Julia Medzegian; Bonnie Walton; Gregg A. Zimmerman; Doug Jacobson; Chris Barnes
Subject: $3.2 Million QECB Final Numbers
Attachments: 05.15.13 Renton-- LTGO Bond, 2013.pdf
Council, this is an update on the final pricing of the QECB bonds we are issuing for the LED light conversion project. We
priced the Bonds on May 15 and the final numbers are attached. In summary,the 15-year taxable LTGO will carry an
interest rate at 3.22%, and the IRS refund will be set at 3.15%. The result is a saving of$810k in interest costs, and a net
interest cost to the city of$18k over the 15-year period (page 7 and 8 of the attached).
The Ordinance for the bond issue, updated with the final interest rate, is up for second reading and adoption
tonight. The bond is set to close on July 1, 2013.
Let me know if you have any questions.
Iwen Wang
Administrative Services Administrator
City of Renton
(425)430-6858
Iwan�@rentonwa.gov
RE� �r�,
i
. � �
TABLE OF CONTENTS
City of Renton,Washington
Limited Tax General Obligation Bond,2013
Tasable llirect-Pay Qualified Energy Conservation Bond
*s*s»***:**************v*»**:****:r:*s*:**r**v*****t*****
Final
Federal Subsidy of 3.15%Assumes QTCB Rate of 4.50%
May 15,2013
r�******ss►*a:****�****rs*a***ts*:**s******r***�**+s**s»*
Report Page
Sources and Uses of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Cost of Issuance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Bond Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Bond Summary Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Bond Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Net Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Form 8038 Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Prepared by Piper Jaffray&Co.
� � �
SOURCES AND USES OF r'UNDS
City of Renton,Washington
Limited TaY General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
s+***:�+*+:*s****�.*rs:�s***:�********�**.*�*�•+*.**+.*.s
Final
Federal Subsidy of 3.15%Assumes QTCB Rate of 4.50°%
May 15,2013
:r*xar****�+*r*r**.t**:*r:**s•+a�»**s***.srr*s*:s***r*s:t
Dated Date 07/O1/2013
Delivery Date 07/Ol/2013
Sources:
Bond Proceeds:
Par Amount 3,200,000.00
3,200,000.00
Uses:
Project Fund Deposits:
Project Fund 3,167,150.00
Delivery Date Expenses:
Cost of Issuance 32,850A0
3,200,OOOAO
Prepared by Piper Jaffray&Co. Page 1
, � �
COST OF ISSUANCE
City of Renton,Washington
Limited Ta�c General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
**r*+*:*ss****r**s*».*•*:r***a*.**x**�*s***s*a***:***ss**
Final
Federal Subsidy of 3.15%Assumes QTCB Rate of 4.50%
May I5,2013
****s+*s*r*.rs�**�.****.**+**a***:****s*:*�+s*r.r**,:***�*
Cost of Issuance $/]000 Amount
Loan Placement Agent 7.00000 22,400.00
Bond Counsel 2.81250 9,000.00
Loan Provider's Counsel 0.37500 1,200.00
CUSIP 0.07813 250.00
]0.26563 32,850.00
Prepared by Piper Jaffray&Co. Page 2
. `�; �.r�
BOND PRICING
City of Renton,Washington
Limited T�General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
*s**ss***s**.****:****:+*..*�**s*.***:****s�*****:*s*:s�+
Final
Federal Subsidy of 3.15%Assumes QTCB Rate of 4.50°%
May 15,2013
:tx*a»►r**s***►*�:**:r»�ss*****rs�*****s**�*s***t*x**�****
Maturity
Bond Component Date Amount Rate Yield Price
Term Bond:
07/Ol/2028 3,200,000 3.220% 3.220% 100.000
3,200,000
Dated Date 07/Ol/2013
Delivery Date 07/O1/2013
First Coupon Ol/01/2014
Par Amount 3,200,000.00
Original Issue Discount
Production 3,200,000.00 100.000000%
Undenvriter's Discount
Pwchase Price 3,200,000.00 100.000000%
Accrued Interest
Net Proceeds 3,200,000.00
Prepazed by Piper Jaffray&Co. Page 3
. �r+� �r�'
BOND SUMMARY STATISTICS
City of Renton,Washington
Limited T�General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
*******s:ts*r*:t*t�s�ss****�«s*a**r*�s****rs:****»*****r**
Final
Federal Subsidy of 3.15%Assumes QTCB Rate of 4.50°0
May 15,2013
*�rs******.s***:»+*****s**s*..*r*****�*s*:s*****..*******
Dated Date 07/O1/2013
Delivery Date 07/Ol/2013
Last Mahuity 07/O1/2028
Arbitrage Yield 0.070000%
True Interest Cost(TIC) 0.070000%
Net Interest Cost(IVIC) 3.220000%
All-In TIC 0.199080°/a
Average Coupon 3.220000%
Average Life(years) 8.039
Duration of Issue(years) 7.489
Par Amount 3,200,000.00
Bond Proceeds 3,200,000.00
Total Interest 828,345.00
Net lnterest 828,345.00
Total Debt Service 4,028,345.00
Maximum Annual Debt Service 313,040.00
Average Annual Debt Service 268,556.33
Underwriter's Fees(per$]000)
Average Takedown
Other Fee
Total Underwriter's Discount
Bid Price 100.000000
Par Average Average
Bond Component Value Price Coupon Life
Term Bond 3,200,000.00 100.000 3.220% 8.039
3,200,000.00 8.039
Prepared by Piper Jaffray&Co. Page 4
� �
BOND SUMMARY STATISTICS
City of Renton,Washington
Limited T�General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
***s***:***�*ss*ss**s:srs*****s*s**a.:*****r�****«x**:srt
Final
Federal Subsidy of 3.]5%Assumes QTCB Rate of 4.50°ia
May 15,2013
*.****:.s*».«,:*****..:******:*****,*********:*********«*
All-In Arbitrage
TIC TIC Yield
Par Value 3,200,000.00 3,200,000.00 3,200,000.00
+Accrued Interest
+Premium(Discount)
-Undenvriter s Discount
-Cost of Issuance Expense -32,850.00
-Other Amounts
Target Value 3,200,000.00 3,167,150.00 3,200,000.00
Target Date 07/01/2013 07/OU2013 07/O1/2013
Yield 0.070000% 0.199080°/a 0.070000%
Prepared by Piper Jaffray&Co. Page 5
� �
BOND DEBT SERVICE
Ciry of Renton,Washington
Limited Tax General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
**a*******a***s**�*r*.***a:***r*�**a*:s*s**s*****s�x**:**
Final
Federal Subsidy of 3.15%Assumes QTCB Rate of 4.50°'0
� May I5,2013
s*:*s:�»:***s*+.*s**.***x:***s*:*.*****r*��**.*:****r**:**
Dated Date 07/O1/2013
Delivery Date 07/01/2013
Annual
Period Debt
Ending Principal Interest Debt Service Service
O1/O1/2014 51,520.00 51,520.00
07/O1/2014 210,000 51,520.00 261,520.00 313,040
O1/O1/2015 48,139.00 48,139.00
07/O 1/2015 210,000 48,139.00 258,139.00 306,278
Ol/O1/2016 44,758.00 44,758.00
07/01/2016 210,000 44,758.00 254,758.00 299,516
Ol/O1/2017 41,377.00 41,377.00
07/Ol/2017 210,000 41,377.00 25],377.00 292,754
Ol/O1/2018 37,996.00 37,996.00
07/01/2018 210,000 37,996.00 247,996.00 285,992
O1/Ol/2019 34,615.00 34,615.00
07/Ol/2019 215,000 34,615.00 249,615.00 284,230
Ol/O1/2020 31,153.50 31,153.50
07/OU2020 215,000 31,153.50 246,153.50 277,307
O]/Ol/2021 27,692.00 27,692.00
07/O1/2021 215,000 27,692.00 242,692.00 270,384
Ol/O1/2022 24,230.50 24,230.50
07/O1/2022 215,000 24,230.50 239,230.50 263,461
O1/Ol/2023 20,769.00 2Q769.00
07/O1/2023 215,000 20,769.00 235,769.00 256,538
O 1/01/2024 17,307.50 17,307.50
07/01/2024 215,000 17,307.50 232,307.50 249,615
O1/O1/2025 13,846.00 13,846.00
07(Ol/2025 215,000 13,846.00 228,846.00 242,692
Ol/O1/2026 10,38G.50 ]0,384.50
07/O1/2026 215,000 10,384.50 225,384.50 235,769
Ol/Ol/2027 6,923.00 6,923.00
07/O1/2027 215,000 6,923.00 221,923.00 228,846
O1/Oi/2028 3,461.50 3,461.50
07/O1/2028 215,000 3,461.50 218,461.50 221,923
3,200,000 828,345.00 4,028,345.00 4,028,345
Prepared by Piper Jaffray&Co. Page 6
NET DEBT SERVICE �
City of Renton,Washington
Limited Tax General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
***rr+*a**rs**�**r*ss*s*»�**�*�**r***r+r:s�****a**a�*ss**
Final
Federal Subsidy of 3.15%Assumes QTCB Rate of 4.50%
May 15,2013
***+.:��■+.*.:+*�+*+�+*��*+*:*�+.+*.���*++**v**+.���:****
Period Total Net Annual
Ending Principal Coupon Interest Debt Service QECB Subsidy Debt Service Net D/S �
01/O1/2014 51,520.00 51,520.00 -50,400.00 1,120.00
07/O1/2014 Z10,000 3.220% 51,520.00 261,520.00 -50,400.00 211,120.00 212,240.00
O1l01/2015 48,139.00 48,139.00 -47,092.50 1,046.50
07/O1/2015 210,000 3.220% 48,139.00 258,139.00 -47,092.50 211,046.50 212,093.00
01/O1/2016 44,758.00 44,758.00 -43,785.00 973.00
07/O1/2016 210,000 3.220% 44,758.00 254,758.00 -43,785.00 � 210,973.00 211,946.00
O1/O1/2017 41,377.00 41,377.00 -40,477.50 899.50
07/01/2017 210,000 3.220% 41,377.00 251,377.00 -40,477.50 210,899.50 211,799.00
O1/01/2018 37,996.00 37,996.00 -37,170.00 826.00
07/O1/2018 210,000 3.220% 37,996.00 247,996.00 -37,170.00 210,826.00 211,652.00
O1/O1/2019 34,615.00 34,615.00 -33,862.50 752.50
07/O1/2019 215,000 3.220% 34,615.00 249,615.00 -33,862.50 215,752.50 216,505.00
O1/O1/2020 31,153.50 31,153.50 -30,476.25 677.25
07/O1/2020 215,000 3.220% 31,153.50 246,153.50 -30,476.25 215,677.25 216,354.50
01/01/2021 27,692.00 27,692.00 -27,090.00 602.00
07/O1/2021 215,000 3.220"/0 27,692.00 242,692.00 -27,090.00 215,602.00 216,204.00
O1/O1/2022 24,230.50 24,230.50 -23,703.75 526.75
07/01/2022 215,000 3.220% 24,230.50 239,230.50 -23,703.75 215,526.75 216,053.50
O1/O1/2023 20;769.Op Zn,769.On _�n,31,sn 45L5Q �
07/O1/2023 215,000 3.220% 20,769.00 235,769.00 -20,317.50 215,451.50 215,903.00
O1/O1/2024 17,307.50 17,307.50 -16,931.25 3'76.25
07/Ol/2024 215,000 3.220% 17,307.50 232,307.50 -16,931.25 215,376.25 215,752.50
O1/O1/2025 13,846.00 13,846.00 -13,545.00 30�1.00
07/O1/2025 215,000 3.220% 13,846.00 228,846.00 -13,545.00 215,301.00 215,602.00
01/O1/2026 10,384.50 10,384.50 -10,158.75 225.75
07/O1/2026 215,000 3.220% 10,384.50 225,384.50 -10,158.75 215,225.75 215,451.50
Prepared by Piper Jaffray&Co. Page 7
NET DEBT SERVICE �
City of Renton,Washington
Limited Tax General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
�***��.+*�.*+«********,*+r,:.*«*+****+*«+»»***+.+*�*�«�*r*
Final
Federa]Subsidy of 3.IS%Assumes QTCB Rate of 4.50%
May I5,2013
r**.*�*«*.+**��r:�+**s+*+*��*r�*rsr*a**c*�+*+re�*��*:**�.
Period Total Net Annual
Ending Principal Coupon Interest Debt Service QECB Subsidy Debt Service Net D/S �
O1/O1/2027 6,923.00 6,923.00 -6,772.50 150.50
07/Ol/2027 215,000 3.220% 6,923.00 221,923.00 -6,772.50 215,150.50 215,301.00
O1/O1/2028 3,461.50 3,461.50 -3,386.25 75.25
07/O1/2028 215,000 3.220% 3,461.50 218,461.50 -3,386.25 215,075.25 215,150.50
3,200,000 828,345.00 4,028,345.00 -810,337.50 3,218,007.50 3,218,007.50
�
Prepared by Piper Jaffray&Co. Page 8
.
. � �` �'`
FORM 8038 STATISTICS
City of Renton,Washington
Limited Ta�c General Obligation Bond,2013
Taxable Direct-Pay Qualified Energy Conservation Bond
s***r**s*arss*:**.****►rrr*****sar*��*«*.***:***a*�r+rs*:
Final
Federal Subsidy of 3.15%Asswnes QTCB Rate of 4.50°%
May I5,2013
*rst*:**�****s**sr*s�:s****s:ss*.*s**+**�*s*r***•r*r***:s
Dated Date 07/O1/2013
Delivery Date 07/Ol/2013
Redemption
Bond Component Date Principal Coupon Price Issue Price at Maturity
Term Bond:
07/O1/2014 210,000.00 3.220% 100.000 210,000.00 210,000.00
07/Ol/2015 210,000.00 3.220% ]00.000 210,000.00 210,000.00
07/O1/2016 210,000.00 3.220% I00.000 210,000.00 210,000.00
07/01/2017 210,000.00 3.220% 100.000 21Q000.00 2I0,000.00
07/O1/2018 210,000.00 3.220% 100.000 210,000.00 210,000.00
07/O1/2019 215,000.00 3.220% 100.000 215,000.00 215,000.00
07/O1/2020 215,000.00 3.220% 100.000 215,000.00 215,000.00
07/O1/2021 215,000.00 3.220% 100.000 215,000.00 215,000.00
07/01/2022 215,000.00 3.220°/a 100.000 215,000.00 215,000.00
07/O1/2023 215,000.00 3.220% ]00.000 215,000.00 215,000.00
07/Ol/2024 215,000.00 3.220% 100.000 215,000.00 215,000.00
07/O1/2025 215,000.00 3.220% 100.000 215,000.00 215,000.00
07/Ol/2026 215,000.00 3.220% 100.000 215,000.00 215,000.00
07/Ol/2027 215,000.00 3.220% 100.000 215,000.00 215,000.00
07/O1/2028 215,000.00 3.220% 100.000 215,000.00 215,000.00
3,200,000.00 3,200,000.00 3,200,000.00
Stated Weighted
Maturity Interest Issue Redemption Average
Date Rate Price at Maturiry Maturity Yield
Final Maturity 07/O1/2028 3.22(1°/a 215,000.00 215,000.00
Entire Issue 3,200,000.00 3,200,000.00 8.0391 0.0700%
Proceeds used for accrued interest 0.00
Proceeds used for bond issuance costs(including undenvriters'discount) 32,850.00
Proceeds used for credit enhancement 0.00
Proceeds allocated to reasonably required reserve or replacement fund 0.00
Prepared by Piper Jaffray&Co. Page 9
May 13, 2013 � Renton City Council Minutes � Page 147
The following ordinances were presented for first reading and referred to the
5/20/2013 Council meeting for second and final reading:
CED: Revise Kent, Renton,and An ordinance was read amending Section 4-1-160 of Chapter 1,Administration
Issaquah School District and Enforcement, of Title IV(Development Regulations),of City Code,setting
tmpact Fees&Adopt Capital the impact fee at$3,738 per new single-family home in the Issaquah School
Facilities Plans District; retaining the impact fee of$5,486 per new single-family home and
$3,378 per new multi-family home in the Kent School District; setting the
impact fee at$6,395 per new single-family home and$1,308 per new multi-
family home in the Renton School District;and adopting the Capital Facilities
Plans of the Issaquah, Kent, and Renton School Districts. MOVED BY BRIERE,
SECONDED BY PERSSON, COUNCIL REFER THE ORDINANCE FOR SECOND AND
FINAL READING ON 5/20/2013. CARRIED.
CED:School Impact Fees An ordinance was read amending Section 4-1-160,of Chapter 1,Administration
Waiver, Payment Under and Enforcement,of Title IV(Development Regulations),of City Code, addi.ng a
Protest&Appeals new Subsection 4-1-160.E.4., Regarding School Impact Fees Waiver, Payment
Under Protest,and Appeals. MOVED BY BRIERE,SECONDED BY PERSSON,
COUNCIL REFER THE ORDINANCE FOR SECOND AND FINAL READING ON
5 20 2013. CARRIED.
Finance: QECB Bond, An ordinance was read authorizing the issuance and sale of a Limited Tax
Streetlight Replacement General Obligation (LTGO) bond of the City of Renton in the principal amount
, +� not to exceed$3,200,000 for the purpose of financing streetlight
��rj1� ��'I� improvements as part of a Green Community Program; providing the form of
the bond;and authorizing the sale of the bond. MOVED BY BRIERE, SECONDED
BY PERSSON, COUNCIL REFER THE ORDINANCE FOR SECOND AND FINAL
READING ON 5/20/2013. CARRIED.
The following ordinance was presented for second and final reading:
ORDINANCE#5688 An ordinance was read amending Section 4-8-110, of Chapter 8, Permits—
Finance: Entertainment Device General and Appeals, of Title IV(Development Regulations), Chapter 1, Fee
License Fee, Code Amendment Schedule,Section 5-7-1 of Chapter 7, Entertainment Device Tax,and Chapter 8,
Gambling Tax,of Title V(Finance and Business Regulations),of City Code,
renaming Chapter 1 "Definitions and Fee Schedule,"adding definitions for Title
V, adding a Section 5-1-2, Fee Schedule Adopted, renumbering Section 5-1-8,
Airport Fuel Flowage Fees,as 5-1-3,eliminating Sections 5-1-4 through 5-1-9,
renaming Chapter 7 as"Entertainment Device License," revising the definition
of"Entertainment Device,"and amending regulations regarding entertainment
device license fees and gambling taxes. MOVED BY BRIERE,SECONDED BY
PERSSON, COUNCIL ADOPT THE ORD.INANCE AS READ. ROLL CALL. ALL AYES.
CARRIED.
NEW BUSINESS Councilmember Prince announced that he had attended the Renton Piazza
Community Event: Renton Spring Festival and Rely on Renton Family Fair this past weekend. He remarked
Piazza Spring Festival& Rely that the weather was perfect for the festival, and that he was glad to see the
on Renton Family Fair two organizations partnering together.
May 13, 2013 '�` Renton City Council Minutes � Page 145
• Collect the requested impact fee of$6,395, and increase of$3,for each
new single-family home and $1,308, an increase of$34,for each new multi-
family unit on behalf of the Renton School District.
The Committee further recommended concurrence with the staff
recommendation to adopt an ordinance to waive unidentified miscalculations
of school impact fee payments unless the payment was paid for under protest.
Lastly,the Committee recommended that the ordinances regarding this matter
be prepared for first reading.
MOVED BY BRIERE,SECONDED BY PERSSON,COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED. (See page 146 for resolution and 147 for
ordinances.)
Lease: Fourth Floor of City Finance Committee Chair Briere presented a report recommending
Hall, Iron Mountain concurrence in the staff recommendation to approve a twct-year lease
Information Management, amendment with Iron Mountain Information Management, Inc., for continued
LAG-00-003 tenancy of 14,208 square feet of the fourth floor of Renton City Hall, 1055 S.
Grady Way, Renton, WA 98057.
The Committee further recommended that the Mavor and Citv Clerk be
authorized to sign the lease amendment.
MOVED BY BRIERE, SECONDED BY PERSSON, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Finance: QECB Bond, ' Finance Committee Chair Briere presented a report recommending
Streetlight Replacement concurrence in the staff recommendatian for the issuance of$3.2 million in 15-
year Qualified Energy Conservation Bonds, with direct federal credit payments
, i , to the City to offset interest costs for the purpose of financing the conversion of
,. i � ''f_� approximately 3,900 High Pressure Sodium (HPS)street lights to Light-Emitting
��'"��� Diode (LED) lights. The bonds will be issued through private placement with
terms substantially the same as presented in the Term Sheet titled,
"TRANSACTION TERMS Renton,WA QECB (4/Z2/2013)."
� The Committee further recommended that the enabling ordinance for the bond
� issuance be presented for first reading.
! MOVED BY BRIERE,SECONDED BY PERSSON,COUNCIL CONCUR IN THE
�! COMMITTEE REPORT. CARRIED. (See page 147 for ordinance.)
Communitv Services Community Services Committee Chair Taylor presented a report recommending
Committee concurrence in Mayor Law's appointment of Mr. Mitch Shephe�d to the Renton
Appointment: Municipal Arts Municipal Arts Commission for an unexpired term expiring 12/31/2015.
Commission MOVED BY TAYLOR,SECONDED BY PALMER, COUNCIL CONCUR IN THE
COMMITTEE REPORT. CARRIED.
Councilmember Taylor introduced Mr. Shepherd who was in the audience. Mr.
Shepherd stated that he believes arts in the community are important,and
thanked the Mayor and Council for his appointment to the commission.
�r++� '�r�
:�������� ��
FINANCE COMMITTEE �I�T� �C�UNCII�,
COMMITTEE REPORT
_ � � �-l�-ao�3
�.���
� May 13, 2013
LED Streetlight Conversion Financing Plan
(Referred May 6, 2013)
The Finance Committee recommends concurrence with the staff recommendation for the
issuance of $3.2 million in 15-year Qualified Energy Conservation Bonds, with -direct federal
credit payments to the city to offset interest costs for the purpose of financing the conversion
of approximately 3,900 High Pressure Sodium (HPS) street lights to Light-Emitting Diode (LED)
lights. The bonds will be issued through private placement with terms substantially the same
as presented in the Term Sheet titled, "TRANSACTION TERMS Renton, WA QECB (4/22/13)".
The Committee further recornmends that the enabling ordinance for the bond issuance be
presented for first reading.
c�t��
Terri Bri , Chair
Don Persson, Vice Chair
��S�+Je�1�re� :
Rich Zwicker, IVlember
cc: Doug Jacobson
Chris Bames
May 6,2013 � Renton City Council Minutes �' Page 135
Citizen Comment: Ouellette— Paul Ouellette (Renton)stated that the birds have returned to his
Atleged Effect of Waterline neighborhood after an unexplained absence of approximately four months.
Smart Meters on Bird Additionally, Mr. Ouellette suggested asking the King County Library System
Population&Cedar River (KCLS)to incorporate an additional door into the entrance vestibule at the
Library Cedar River Library that would connect the library to the bridge leading to
Liberty Park. He displayed drawings showing how he believed this new door
could be added to the design plan.
Mayor Law pointed out that Council had already recommended this change to
KCLS as part of the action regarding the Cedar River Library that was taken at
last week's Council meeting.
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 4/29/2013. Council concur.
4/29/2013
Finance:QECB Bond,Street Administrative Services Department requested approval of an ordinance
Light Replacement authorizing the issuance of a 15-year Qualified Energy Conservation Bond
� `, (QECB)through private placement not to exceed $3.2 million to finance the
}���,,�- �'��� conversion of approximately 3,900 High Pressure Sodium (HPS)street lights to
Light-Emitting Diode (LED) lights,with annual debt service payments of
approximately$220,000,which will be paid from energy cost savings projected
at$270,000 per year. Refer to Finance Committee.
Appointment: Lodging Tax Community and Economic Development Department recommended the
Advisory Committee_ , appointment of Lynn Wallace, President and CFO of the Renton Chamber of - -
Commerce (replacing Sabrina Mirante),to the Lodging Tax Advisory
Committee;and ratification of the existing membership as follows: City
Councilmember Marcie Palmer; Preeti Shridhar, City of Renton Deputy Public
Affairs Administrator; Brent Camman,General Manager of Marriott Spring Hill
and Marriott Towne Place;and Kathy Madison,General Manager of Hilton
Garden Inn. Council concur.
Community Services: Park Community Services Department recommended approval of amendments to
Rules& Regulations, Code existing Park Rules and Regulations that clarify rules, identify changing
Amendment operations and activities,and authorize enforcement of the regulations. Refer
to Communitv Services Committee.
Acquisition: May Creek Community Services Department requested authorization to acquire the two-
Trailhead Parcel parcel May Creek Trailhead properry in the amount of$370,000 to provide
parking and access to the May Creek Trail; and authorization to adjust the
budget as required. Council concur.
CAG: 12-120,WA DES, Street Transportation Systems Division recommended approval of an amendment to
Light Conversion Services CAG-12-120, interlocal agreement with the Washington State Department of
Enterprise Services(DES), in the amount of$4,305,693 (Renton's share
approximately$3,216,681 after grants),which includes the Energy Services
Proposal from Ameresco Quantum, Inc. (AQ)and management and monitoring
services to convert High Pressure Sodium (HPS)street lights to Light-Emitting
Diode(LED) lights;and requested authorization for the administration to
pursue the issuance of a Qualified Energy Conservation Bond (QECB)to provide
funding for the project. Refer to Transportation (Aviation) Committee
, �✓ �
CITY OF RENTON COUNCIL AGEf�tDA BIEL .�t d
f7
Subject/Title• Meeting:
LED Street Light Conversion Financing Plan Regular Council - 06 May 2013
Exhibits: Submitting Data: Dept/Div/Board:
Issue Paper Administrative Services
Private Placement Term Sheet/Preliminary Debt
Service Schedule Staff Contact:
Preliminary Draft Ordinance Iwen Wang
Recommended Action:
Refer to Finance Committee
Fiscal Impact:
Expenditure Required: $ $3,200,000 Transfer Amendment: $
Amount Budgeted: $ Revenue Generated: $
Total Project Budget: $ City Share Total Project: $
SUMMARY OF ACTION:
As separately presented, the city is proposing to convert approximately 3,900 street (ights to LED lights
at a total cost ofi$4.3 miUion.The LED Light Conversion Project will be funded through a combination of
$1.1 million in grants and $3.2 million in long term financing by issuing Qualified Energy Conservation
Bonds (QECB), a version of general obligation bonds.
The City requested and received $3.2 million in QECB allocation from the State Housing Finance
Commission for the LED Light Conversion Project. Staff recommend a 15-year issue with net annual debt
service payment projected at around $220k. The debt service will be paid using the energy cost
savings, estimated at about$270k a year.
In addition, with the relatively small amount to be financed, staff recommends using private placement
option for this issue.
STAFF RECOMMENDATION:
Adopt an ordinance authorizing the issuance of a 15-year QECB through private placement with terms
substantially the same as outlined in the attached Term Sheet.
� � �
ADMINISTRATIVE SERVICES ��'�f , -�,
DEPARTMENT
° C�����4 ���
M E M O R A N Q U M
DATE: April 30, 2013
TO: Randy Corman, Council President
Members of the Renton City Council
CC: Denis Law, Mayor
FROM: Iwen Wang,Administrative Services Administrator
SUBJECT: LED Street Light Conversion Financing Plan
ISSUE:
Should the City issue $3.2 million in Qualified Energy Conservation Bonds (QECB) through
private placement, based on the proposed terms, to finance the conversion of approximately
3,900 High Pressure Sodium (HPS)street lights to Light-Emitting Diode (LED) lights?
RECOMMENDATION:
Approve proposed ordinance and financing plan for the proposed street light conversion
project.
BACKGROUND SUMMARY:
As presented to the Council Transportation/Aviation Committee, the City is proposing to
convert all City-owned street lights to LED lights in 2013 at a total cost of $4.3 million. The
project will be funded through a combination of grants from the State Department of
Commerce ($500k), Energy Incentive Program from Puget Sound Energy ($589k), and long term
financing by issuing QECB, a version of general obligation bonds.
QECB is part of a federal "green community' incentive program that allows government entities
to issue long term bonds to finance energy conservation projects for public and private (limited
to 30% of allocated amount) facilities. The program requires the bonds be issued as taxable
bonds with a federal direct payment (to bond issuers) or tax credit (to bond holders) based on
70%of yields on outstanding bonds with an investment grade rating between A and BBB.
The City requested and received $3.2 Million in QECB allocation from the State Housing Finance
Commission for the LED Light Conversion Project. Based on the current market conditions, the
net interest cost after federal rebate is between 0%to 0.6%for a 15-year bond; and just below
1%for a 20-year bond. The annual debt service payments are approximately$220k and $180k,
for 15- and 20-year bonds, respectively. The debt service will be paid using the energy cost
savings that are estimated to be $270k a year. Therefore, the transaction will result in a
positive impact for the City. •
' '`r+ �
LED Street Light Financing
Page 2 of 3
April 30,2013
One caveat about the direct federal rebate program is that it is subject to federal budget and
legislation changes, such as the sequestration. Under current sequestration conditions, the
federal rebates are set to be reduced by 8.9%this year, same level of reduction as other federal
programs. Should this occur during the term of the bonds, the reduction in the rebate would
range from $8,900 in the first year to $560 in the final year. To make sure the City will not pay
more than tax-exempt rates in any circumstances, an "extraordinary optional redemption"
provision will be included in the bonds to allow the City to call the bonds at face value and
reissue tax exempt bonds if necessary.
In addition, with the relatively small amount being financed, staff has been looking at issuing
the bonds through private placements instead of public sales. The preliminary quotes show
that the rates between the two options are competitive (with private placement showing $5k
savings over 15 years) and the cost of issuance will be lower for private placements (no bond
rating or official statement preparation costs). Therefore, staff recommends using private
placement option for this issue.
CONCLUSION:
Converting the City's HPS streetlights to LED will generate significant energy and maintenance
cost savings to the City. The QECB is the most cost effective way to finance the conversion; and
private placement is a cost effective way to issue the bonds. Staff recommends adopting an
ordinance authorizing the issuance of QECB through private placement with terms substantially
the same as outlined in the attached "Term Sheet"and the preliminary amortization schedule.
Attachment:
1. PiperJaffray Private Placement Term Sheet/Preliminary Amortization Schedule
2. Preliminary draft ordinance.
� � •
LED Street Light Financing
Page 3 of 3
April 30,2013
, � _� ,
Attachment 1: Term Sheet
TRANSACTION TERMS
Renton,WA QECB(4122/13)
ProceedslLoan/Debt: Approximately $3,200,000. Purchaser will ailow for +/-10% of
Proceeds between Commitment and Funding.
The Issuer or Borrower: City of Renton,WA(the"City") or an applicable Conduit Issuer.
Securities Offered: The Issuer will issue approximately $3.2 million limited tax
general obligation Notes/Bonds under the Qualified Energy
Conservation Bond (QECB)—Direct Payment program.
Security: Limited Tax General Obligation of the City.
Purchase Price: 100%.
Coupon: The greater of 3.00% or +1.70% to the Index to be locked at
Commitment.
Index: Average Life Interpolated Treasury. As of April 22, 2015, the
Index is 1.3%.
Maturity Date: 15 years.
Average Life: 8 years.
Optional Redemption: Open at anytime at the Makewhole Amount.
Makewhole Amount: The Make Whole Amount is the excess, if any, of (i) the sum of
the present values (determined as of the date of prepayment) of
all remaining scheduled pay,ments of principal and interest on the
Note from the date of prepayment to the maturity date,
discounted at a rate equal to the yield on the interpolated US
Treasury obligation having a weighted average to that of the
Note at the time of prepayment plus 50 basis points, over(ii) the
principal amount of the Note being prepaid.
Extraordinary Optional Redemption: At Par plus accrued interest, if the United States Department of
the Treasury (the "Treasury") should cease, or announce its
intention to cease, the QECB Program subsidy or if there is a
QECB disqualification event.
Starting at the beginning of year 3 of the Term, the Bonds can be
prepaid at par if the Treasury shall reduce the subsidy from the
current 70%to 35%or less.
Extraordinary Mandatary
Redemption: At Par plus accrued interest, if on any date that is within 3 years
from the date of issuance of the QECB Bond, it is determined
that the Borrower has expended or will expend less than 100
'rI�P' +`�' .
LED Street Light Financing
Page 2 of 2
April 30,2013
percent of the "available project proceeds." The amount of
Proceeds not expended will be subject to the Redemption.
Interest Payments: Semi-annual on a 30/360 basis.
Method of Sale: The Notes will be sold in a private placement to institutional
investors who are accredited investors (accredited investors
constitute investors who qualify as accredited investors under
paragraphs 1,2,3, or 7 of Rule 501(a) of the Securities Act of
1933). The Notes will not be registered with the Securities and
Exchange Commission or any other regulatory body.
Accordingly, the Notes will not be transferable unless a
subsequent transfer is exempt from the registration requirements
of the Securities Act of 1933 (the "1933 Act"). Investors should
consult with their counsel as to the applicable requirements for
an investor to avail itself of any exemption under the 1933 Act.
Each investor will be required to make certain representations in
connection with its purchase of the Notes.
Rate Lock: At Commitment. Purchaser shall endeavor for a Commitment
within 3-5 business days of verbal award by the City.
ClosinglFunding Date: July 1, 2013.
Trustee: None.
Special Counsel to
Bond Purchasers: To be determined.
Placement Agent: Piper Jaffray.
Subject to: 1. Closing on loan documents usual and customary in the
Private Placement market for these transactions.
2. This is not a Commitment.
3. Formal approval by Renton City Council.
Agreed and Accepted by the Purchaser:
Name/Title/Company(Please Print)
Signature/Date
h:\finance\council\2013\ip-led term sheet.docx
. � �
TABLE OF CONTENTS
City of Renton
Tanable QECB Private Placement,Series 2013
**:***r*:�****»*s�t*ss**t:*+**rrs**s*sss**s**�**:srr*:*ss
Rate as of May 1,2013
Spread Lock Effective Through July 1,2013
QTCB of 4.28%
**:�:,�***.***.::�.***:**�«*�*:..*:**�*:.�*:***+**�***+:**
Report
Page
Sources and Uses of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Cost of Issuance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Bond Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Bond Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Net Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Bond Summary Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Prepared by Piper Jaf�ray&Co.
� � ,
SOURCES AND USES OF FUNDS
City of Renton
Taxab]e QECB Private Placement,Series 2013
*+�r*:::s**+srss:+.::»***rs��*s*s�*s*s�*»+ss�.�+*:*+...*s
Rate as of May 1,2013
Spread Lock Effective'Through July 1,2013
QTCB of 4.28°/a
*s�r�+s+*�:s*.s*.rs�#*s*.+:»*s�sss*a+:**********�s�s»*s*+
Dated Date 07/Ol/2013
Delivery Date 07/0112013
Sowces:
Bond Proceeds:
Par Amount 3,200,000.00
3,200,000.00
Uses:
Project Fund Deposits:
Project Fund 3,167,400.00
Delivery Date Expenses:
Cost of Issuance 32,600.00
3,200,000.00
Prepared by Piper Jaffray&Co. � Page 1
. � �
COST OFISSUANCE
City of Renton
Taxable QECB Private Placement,Series 2013
s*�*�s*s:s:�***s:*ss*rr��*s**#**»**rs*�**rs*.:»**s�******
Rate as of May 1,2013
Spread Lock Effective Through July 1,2013
QTCB of 4.28%
*:�,:*,:**�****«*::*****��**�s*»�:�**:*.�***:*:***�:*.��.*�*
CostofIssuance $/1000 Amount
Loan Placement Agent 7.00000 22,400.00
Bond Counsel 2.81250 9,000.00
Loan Provider's Counsel 037500 1,200.00
10.18750 32,600.00
Prepared by Piper Jaffray&Co. Page 2
� � �
BOND PRICING
City of Renton
Taxable QECB Private Placement,Series 2013
**s�**�******�*s*..as*****►:*s•****s:*:s.s*+�r*s»**rr**** ,
Rate as of May 1,2013
Spread Lock Effective Through July 1,2013
QTCB of 4.28%
***.:*+s*:*:*:*.*�*ss****:ss*ss**�****s*ssr**:***.:******
Maturity
Bond Component Date Amount Rate Yieid Price
Term Bond:
07/O1/2028 3,200,000 3.040% 3.040% 100.000
3,200,000
Dated Date 07/O1/2013
Delivery Date 07/O1/2013
First Coupon O1/Ol/2014
Par Amount 3,200,000.00
Original Issue Discount
Production 3,200,000.00 100.000000%
Underwriter's Discount '
Purchase Price 3,200,000.00 100.000000%
Accrued Interest
Net Proceeds 3,200,000.00
Prepared by Piper Jaffray&Co. Page 3
, � ��
BOND DEBT SERVICE
City of Renton
Taxable QECB Private Placement,Series 2013
a**s»**rss.��**»**sr**.*s******r**r*s***r.:**ss*s:*+�*ss*
Rate as of May 1,2013
Spread Lock Effective Through July 1,2013
QTCB of 4.28%
�:.�.****�***�*�**:+#***+����*.�*:*�+..*:+****�*:***�*:.**
Dated Date 07/Ol/2013
Delivery Date 07/Ol/2013
Annual
Period Debt Debt
Ending Principal Coupon Interest Service Service
O1/Oil2014 48,640 48,640
07/O1/2014 210,000 3.040% 48;640 258,640 307,280
Ol/Ol/2015 45,448 45,448
07/O1/2015 210,000 3.040% 45,448 255,448 300,896
01/O1/2016 42,256 42,256
07/Ol/2016 210,000 3.040% 42,256 252,256 294,512
O1/O1/2017 39,064 39,064
07/O1/2017 210,000 3.040% 39,064 249,064 288,128
O1/O1/2018 35,872 35,872
07/O1/2018 210,000 3.040% 35,872 245,872 281,744
01/Ol/2019 32,680 32,680
07/Ol/2019 215,000 3.040% 32,680 247,680 280,360
O1(O1/2020 29,412 29,412
07/O1/2020 215,000 3.040% 29,412 244,412 273,824
01/01/2021 26,144 26,144
07/O1/2021 215,000 3.040% 26,144 241,144 267,288
01/O1/2022 22,876 22,876
07/O1/2022 215,000 3.040% 22,876 237,876 260,752
Ol/O1/2023 19,608 19,608
07/Ol/2023 215,000 3.040°/a 19,608 234,608 254,216
O1/O1/2024 16,340 16,340
07/Ol/2024 215,000 3.040% 16,340 231,340 247,680
O1/O1/2025 13,072 13,072
07/O1/2025 215,000 3.040% 13,072 228,072 241,144
O1/O1/2026 g,804 g gpq
07/01/2026 215,000 3.040% 9,804 224,804 234,608
O1/OU2027 6,536 6,536
07/Ol/2027 215,000 3.040% 6,536 221,536 228,072
Ol/O1/2028 3,268 3,268
07/Ol/2028 215,000 3.040% 3,268 218,268 221,536
3,200,000 782,040 3,982,040 3,982,040
Prepared by Piper Jaffray&Co. Page 4
� � '
. NET DEBT SERVICE
City of Renton
Taxable QECB Private Placement,Series 2013
***�r*:**r**r***rr*:sss*s**s:s*s*.**+s*r:�*s+***:s:***s«*
Rate as of May 1,2013
Spread Lock Effective Through July 1,2013
QTCB of 4.28%
r.**rests.*ss***►*r******.**s*.****.**.s****:*r�a*r*t**�*
Period Total Net Annual
Ending Principal Coupon Interest Debt Service QECB Subsidy Debt Service Net D/S
O1/O1/2014 48,640 48,640 -47,936.00 704.00
07/OU2014 210,000 3.040% 48,640 258,640 -47,936.00 210,704.00 211,408.00
O1/01/2015 45,448 45,448 -44,790.20 657.$0
07/O1l2015 210,000 3.040% 45,448 255,448 -44,790.20 210,657.80 211,315.60
Ol/O1/2016 42,256 42,256 -41,644.40 611.60
07/O1/2016 210,000 3.040% 42,256 252,256 -41,644.40 210,611.60 211,223.20
Ol/Oi/2017 39,064 39,064 -38,498.60 565.40
07/Ol/2017 210,000 3.040% 39,064 249,064 -38,498.60 210,565.40 211,130.80
Ol/O1/2018 35,872 35,872 -35,352.80 519.20
07/Ol/2018 210,000 3.040% 35,872 245,872 -35,352.80 210,519.20 211,038.40
Ol/O1/2019 32,680 32,680 -32,207.00 473.00
07/Ol/2019 215,000 3.040% 32,680 247,680 -32,207.00 215,473.00 215,946.00
O1/Ol/2020 29,412 29,412 -28,986.30 425.70
07/Ol/2020 215,000 3.040% 29,412 244,412 -28,986.30 215,425.70 215,851.40
01/01/2021 26,144 26,144 -25,765.60 378.40
07/O1/2021 2]5,000 3.040% 26,144 241,144 -25,765.60 215,378.40 215,756.80
Ol/O1/2022 22,876 22,876 -22,544.90 331.10
07/O1/2022 215,000 3.040% 22,876 237,876 -22,544.90 215,331.10 215,662.20
O1/OU2023 19,6D8 19,608 -19,324.20 283.80
07/O1/2023 215,000 3.040% 19,608 234,608 -19,324.20 215,283.80 215,567.60
O1/O1/2024 16,340 16,340 -16,103.50 236.50
07/Ol/2024 215,000 3.040% 16,340 231,340 -16,103.50 215,236.50 215,473.00
Ol/O1/2025 13,072 13,072 -12,882.80 189.20
07/O1/2025 215,000 3.040% 13,072 228,072 -12,882.80 215,189.20 215,378.40
O1J01/2026 9,804 9,804 -9,662.10 141.90
07/O1/2026 215,000 3.040% 9,804 224,804 -9,662.10 215,141.90 215,283.80
011O1/2027 6,536 6,536 -6,441.40 94.60
07/O1/2027 215,000 3.040°/a 6,536 221,536 -6,441.40 215,094.60 215,189.20
O1/O1/2028 3,268 3,268 -3,220.70 4730
07/O1/2028 215,000 3.040% 3,268 218,268 -3,220.70 215,04730 215,094.60
3,200,000 782,040 3,982,040 -770,721.00 3,211,319.00 3,211,319.00
Prepared by Piper Jaffray&Co. Page 5
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BOND SiJMMARY STATISTICS
City of Renton
Taxable QECB Private Placement,Series 2013
***.»:,�s**s�s*+****.«s*s**+**»**+::*.s***...+:.*#+�+*.:**
Rate as of May 1,2013
Spread Lock Effective Through July 1,2013
QTCB of 4.28%
***:**«.**+***.*�***:**..***+.*::.*.*�*�+�**�**.*..*:*:*«
Dated Date 07/01/2013
Delivery Date 07/O1/2013
Last Maturity 07/Ol/2028
Arbitrage Yield 0.044000%
True Interest Cost(TIC) 0.044000%
Net Interest Cost(NIC) 3.040000%
All-In TIC 0.171910%
Average Coupon 3.040000%
Average Life(years) 8.039
Duration of Issue(years) 7.518
Par Amount 3,200,000.00
Bond Proceeds 3,200,000.00
Total Interest 782,040.00
Net Interest 782,040.00
Totai Debt Service 3,982,040.00
Maximum Annual Debt Service 307,280.00
Average Annual Debt Service 265,469.33
Underwriter's Fees(per$1000)
Average Takedown
Other Fee
Total Underwriter's Discount
Bid Price 100.000000
Paz Average Average
Bond Component Value Price Coupon Life
Term Bond 3,200,000.00 100.000 3.040% 8.039
3,200,000.00 . 8.039
AIl-In Arbitrage
TIC TIC Yield
Par Value 3,200,000.00 3,200,000.00 3,200,000.00
+Accrued Interest
+Premium(Discount)
-Underwriter's Discount
-Cost of Issuance Expense -32,600.00
-Other Amounu
Target Value 3,200,000.00 3,167,400.00 3,200,000.00
TargetDate 07/Ol/2013 07/O1/2013 07/Ol/2013
Yield 0.044000% 0.171910% 0.044000%
Prepared by Piper Jaf�-ay&Co. Page 6
�' `'�` •
Attachment 2: Draft Borrd Ordinance
CITY OF RENTON, WASHINGTON
LIMITED TAX GENERAL OBLIGATION BOND, 2013
(TAXABLE DIRECT-PAY QUALIFIED ENERGY CONSERVATION BOND)
ORDINANCE NO.
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON, AUTHORIZING THE ISSUANCE AND SALE OF A
LIMITED TAX GENERAL OBLIGATION BOND OF THE CITY IN THE
PRINCIPAL AMOUNT OF NOT TO EXCEED $3,200,000 FOR THE
PURPOSE OF FINANCING STREETLIGHT IMPROVEMENTS AS PART
. OF A GREEN COMMUNITY PROGRAM; PROVIDING THE FORM OF
THE BOND; AND AUTHORIZING THE SALE OF THE BOND TO
Passed , 2013
PREPARED BY:
PaaFica Law GRouP LLP
Seattle, Washington
. � �
CITY OF RENTON
ORDINANCE NO.
TABLE OF CONTENTS*
Pa�e
Section 1. Definitions and Interpretation of Terms..................................................................2
Section 2. Authorization of the Project....................................................................................5
Section 3. Authorization of the Bond .......................................................................................5
Section 4. Registration, Exchange and Payments.....................................................................5
Section5. Form of Bond ...........................................................................................................7
Section6. Execution of Bond....................................................................................................9
Section 7. Application of Bond Proceeds................................................................................10
Section8. Tax Covenants........................................................................................................10
Section 9. Pledge of Funds and Credit; General Obligation ...................................................11
Section 10. Prepayment and Redemption................................................................................12
Section11. Sale of the Bond.............:........................................................_..............................14
Section 12. Ongoing Disctosure; Covenants..................................:..........................................14
Section 13. Lost, Stolen or Destroyed Bond.............................................................................15
Section 14. Severability; Ratification........................................................................................15
Section 15. Effectiv,e Date of Ordinance...................................................................................16
Exhibit A: Purchaser's Proposal
* This Table of Contents is provided for convenience only and is not a part of this ordinance.
� � .
CITY OF RENTON, WASHINGTON
ORDINANCE NO.
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF RENTON,
WASHINGTON, AUTHORIZING THE ISSUANCE AND SALE OF A
LIMITED TAX GENERAL OBLIGATION BOND OF THE CITY IN THE
PRINCIPAL AMOUNT OF NOT TO EXCEED $3,200,000 FOR THE
PURPOSE OF FINANCING STREETLIGHT IMPROVEMENTS AS PART
OF A GREEN COMMUNITY PROGRAM; PROVIDING THE FORM OF
THE BOND; AND AUTHORIZING THE SALE OF THE BOND TO
WHEREAS, the City Council (the "Council") of the City of Renton, Washington (the
"City"), has determined that it is in the best interest of the City that the City adopt a program to
finance capital expenditures to improve certain existing public streetlights located throughout
the City in order to promote energy conservation and efficiency for the benefit of the general
public(the "Program");and
WHEREAS,Section 54D of the Internal Revenue Code of 1986, as amended (the "Code"),
authorizes the issuance of "qualified Energy Conservation Bonds" for capital expenditures
incurred for "qualified conservation purposes," including but not limited to implementing a
green community program under Section 54D(fl(1)(A)(ii) of the Code; and
WHEREAS, the City has received from the Washington State Department of Commerce a
reallocation of up to $3,200,000 of Qualified Energy Conservation Bond volume cap for
purposes of implementing the Program; and
WHEREAS, it is in the best interest of the City to issue a limited general obligation bond
in the principal amount of not to exceed $3,200,000 (the "Bond") to finance costs of
implementing the Program, including financing costs related to replacing existing high-pressure
luminaries with light emitting diode luminaries (the "Project"); and
, � �
WHEREAS, the Bond authorized herein shali be sold as a Qualified Energy Conservation
Bond to {the "Purchaser") pu.rsuant to the purchaser officer set forth in
Exhibit A attached hereto (the "Proposal"), as herein provided; and
WHEREAS, it is deemed necessary and advisable that the City accept the Purchaser's
offer and issue the Bond as set forth herein;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF REN'TON, WASHINGTON DOES
ORDAIN AS FOLLOWS:
Section 1. Definitions and Interpretation of Terms.
(a) Definitions. As used in this ordinance, the followang words shall have the
following meanings:
Bond means the Limited Tax General Obligation Bond, 2013 (Taxable Direct-Pay
Qualified Energy Conservation Bond) authorized to be issued by the City pursuant to this
ordinance.
Bond Counsel means Pacifica Law Group LLP,Seattle, Washington.
eond Fund means the "Bond Redemption Fund" authorized to be created pursuant to
Section 9 of this ordinance.
eond Register means the registration records for the Bond maintainQd by the Bond
Registrar.
eond Registrar means the Finance Director of the City, whose duties include registering
and authenticating the Bond, maintaining the Bond Register, transferring ownership of the
Bond, and paying the principal of and interest on the Bond.
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City means the City of Renton, Washington, a municipal corporation duly organized and
existing under the laws of the State of Washington.
City Council or Counci! means the City Council of the City as the general legislative
authority of the City, as the same shall be duly and regularly constituted from time to time.
Code means the Internal Revenue Code of 1986, as amended, and shall include all
applicable regulations and rulings relating thereto.
Federal Tax Certificate means.the certificate regarding the status of.the Bonds as
Qualified Energy Conservation Bonds under Section 54D of the Code.
Finance Director means the City's Finance and Information Services Administrator or the
successor to such officer.
Interesr Rate means the rate of interest determined pursuant to Section 11 of this.
ordinance as the same may be adjusted pursuant to the Proposal and set forth herein.
Program means the program of the City to finance capital expenditures to improve
certain existing public streetlights located throughout the City in order to promote energy
conservation and efficiency throughout the City for the benefit of the general public.
Project means the project described in Section 2 of this ordinance.
Project Fund means the "Project Fund" authorized to be created pursuant to Section 7
of this ordinance.
Proposal means the proposal letter submitted by the Purchaser substantially in the form
attached hereto as Exhibit A.
Purchaser means
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Registered Owner means the person in whose name the Bond is registered on the Bond
Register.
Rule means the Securities and Exchange Commission's Rule 15c2-12 under the
Securities Exchange Act of 1934, as the same may be amended from time to time.
(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 prececling 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.
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Section 2. Authorization of the Proiect. The Bond is being issued to finance costs of
implementing the Program, including capital improvements related to replacing existing high-
pressure luminaries with light emitting diode luminaries (the "Project"). Any remaining costs of
the Project shall be paid from other City funds legally available for such purpose.
Section 3. Authorization of the Bond. For the purpose of financing costs of the
Project and paying costs of issuance for the Bond, the City hereby authorizes the issuance and
sale of its limited tax general obligation bond in the principal amount of not to exceed
$3,200,000. The bond shall be designated the "City of Renton, Washington, Limited Tax
Genera! Obligation Bond, 2013 (Taxable Direct-Pay Qualified Energy Conservation Bond)," or
other such designation as set forth in the Bond and approved by the Finance Director.
The Bond shall be dated as of its date of delivery, shall be fully registered as to both
principal and interest, shall be in one denomination, and shall mature 15 years from its dated
date. The Bond shall bear interest from its dated date or the most recent date to which interest
has been paid at the Interest Rate, as the same may be adjusted pursuant to the Proposal and
set forth herein. Interest on the principal amount of the Bond shall be calculated per annum on
a 30/360 basis, or as otherwise provided in the Bond. Principal shall be payable at maturity or
prior redemption. Interest on the Bond shall be payable semiannually on the first days of
and as set forth in the payment schedule attached to the Bond.
Section 4. Re�istration, Exchan�e and Pavments.
(a) Registrar/Bond Registrar. The Finance Director shall act as Bond Registrar. The
Bond Registrar is authorized, on behalf of the City, to authenticate and deliver the Bond if
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transferred or exchanged in accordance with the provisions of the Bond and this ordinance and
to carry out all of the Bond Registrar's powers and duties under this ordinance.
(b) Registered Ownership. The City and the Bond Registrar may deem and treat the
Registered Owner of the Bond as the absolute owner for all purposes, and neither the City nor
the Bond Registrar shall be affected by any notice to the contrary. Payment of the Bond shall
be made only as described in subsection (e) below. All such payments made as described in
subsection (e) below shall be valid and shall satisfy the liability of the City upon the Bond to the
extent of the amount so paid.
(c) No Transfer or Exchange of Registered Ownership. The Bond shall not be
transferrable without the consent of the City unless (i) the Purchaser's corporate name is
changed and the transfer is necessary to reflect such change; or(ii)the transferee is a successor
in interest ofi the Purchaser by means of a corporate merger, an exchange of stock, or a sale of
assets.
(d) Registration Covenant. The City covenants that, until the Bond has been
surrendered and canceled, it will maintain a system for recording the ownership of the Bond
that complies with the provisions of Section 149 of the Code.
(e) Place and Medium of Poyment. Both principal of and interest on the Bond shall
be payable in lawful money of the United States of America. Principal and interest on the Bond
shall be payable by check, warrant, ACH transfer or by other means mutually acceptable to the
Purchaser and the City. Upon final payment of principal and interest of the Bond, the
Registered Owner shall surrender the Bond for cancellation at the office of the Bond Registrar
in accordance with this Section 4 and Section 13.
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Section 5. Form of Bond. The Bond shall be in substantially the following form:
UNITED STATES OF AMERICA
NO. R-1 $
STATE OF WASHINGTON
CITY OF RENTON
LIMITED TAX GENERAL OBLIGATION BOND, 2013
(TAXABLE DIRECT-PAY QUALIFIED ENERGY CONSERVATION BOND)
INTEREST RATE: %
MATURITY DATE:
REGISTERED OWNER:
PRINCIPAL AMOUNT: AND NO/100 DOLLARS
The City of Renton, Washington, a municipal corporation organized and existing under
and by virtue of the laws of the State of Washington (the "City"}, hereby acknowledges itself to
owe and for value received promises to pay to the Registered Owner identified above, on or
before the Maturity Date identified above, the Principal Amount identified above. This bond
shall bear interest at the fixed rate stated above (the "Interest Rate"). Interest on this bond
shall accrue from its dated date until paid and shall be computed per annum on the principal
amount outstanding on a 30/360 basis. Accrued interest on this bond shall be payable
semiannually on the dates set forth in the payment schedule attached hereto. Principal shall be
payable at maturity or prior redemption.
Both principal of and interest on this bond shall be payable in lawful money of the
United States of America. Principal and interest on this bond shall be payable by check or
warrant or by other means mutually acceptable to the Registered Owner and the City. Upon
final payment of principal and interest of this bond; the Registered Owner shall surrender this
bond for cancellation at the office of the Bond Registrar in accordance with Ordinance No.
of the City(the "Bond Ordinance").
This bond is issued pursuant to the Bond Ordinance to finance costs related to
implementing a green community program of the City, including streetlight improvements, and
to pay costs of issuance. Capitalized terms used in this bond have the meanings given such
terms in the Bond Ordinance.
The City may prepay and redeem this bond prior to maturity as provided in the Bond
Ordinance.
This bond has not been designated as a "qualified tax-exempt obligation" within the
meaning of Section 265(b)of the Code.
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The City has in the Bond Ordinance authorized the creation of a fund to be used for the
payment of debt service on this bond, designated as the "Bond Redemption Fund" (the "Bond
Fund"). The Bond Fund shall be drawn upon for the sole purpose of paying the principal of and
interest on this bond.
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 callection of such taxes and
the prompt payment of such principal and interest. Any proceeds of this bond not expended on
the Project or costs of issuance shall be pledged to payment of this bond and deposited in the
Bond Fund for such purpose.
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 issued pursuant to the Constitution and laws of the State of Washington,
and duly adopted ordinances of the City. This bond is transferable upon compliance with the
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 exist, have happened, been done and performed
and that the issuance of this bond does not violate any constitutional, statutory or other
limitation upon the amount of 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 signature of the Mayor of the City Council and attested by
the manual or facsimile signature of the Clerk, as of this day of , 2013.
[SEAL] CITY OF RENTON, WASHINGTON
gY /s/
Mayor
ATTEST:
/s/
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City Clerk
REGISTRATION CERTIFICATE
This bond is registered in the name of the Registered Owner on the books of the City, in
the office of the Finance Director of the City (the "Bond Registrar"), as to both principal and
interest, as noted in the registration blank below. All payments of principal of and interest on
this bond shall be made by the City from the Bond Fund.
Date of Name and Address of Signature of
Registration Registered Owner Bond Registrar
_, 2013
Finance Director
PAYMENT SCHEDULE
Principal and interest on this bond shall be payable as set forth in the following
schedule:
Date Principal Interest Total Payment
Section 6. Execution of Bond. The Bond shall be executed on behalf of the City with
the manual or facsimile signature of the Mayor, and shall be attested by the manual or
facsimile signature of the Clerk.
Only such Bond as shall bear thereon a Certificate of Authentication in the form earlier
recited, manually executed by the Bond Registrar, shall be valid or obligatory for any purpose or
. -9- 05/02/13
• � �
entitled to the benefits of this ordinance. Such Certificate of Authentication shall be conclusive
evidence that the Bond so authenticated has been duly executed, authenticated and delivered
hereunder and is entitled to the benefits of this ordinance.
In case either of the officers who shall have executed the Bond shall cease to be an
officer or officers of the City before the Bond so signed shall have been authenticated or
delivered by the Bond Registrar, or issued by the City, such Bond 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. The Bond may also be signed and attested on behalf of the City by such
persons who at the date of the actual execution of the 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 7. Application of Bond Proceeds. The City shall establish a fund designated
the "Project Fund" (the "Project Fund") into which the proceeds of the Bond shall be deposited.
Money in the Project Fund shall be used to pay the costs of the Project and costs of issuance for
the Bond. 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.
Money remaining in the Project Fund after all costs of the Project and costs of issuance for the
Bond have been paid shall be pledged to payment of the Bond and deposited in the Bond Fund
for such purpose.
Section 8. Tax Covenants. The City hereby designates the Program as a "green
community program" for purposes of Section 54D(fl(1)(A)(ii) of the Code. The City reasonably
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� � �
expects that implementation of the Program will promote energy conservation and efficiency
for the benefit of the general public:
The City hereby makes an irrevocable designation under Section 54D of the Code that
the Bond be issued and sold as a "Qualified Energy Conservation Bond." The City makes a
further irrevocable designation to have Section 6431(f){3)(B) of the Code apply to the Bond,
with the effect that the Bond will be issued and sold as a direct payment tax credit bond as set
forth in the Federal Tax Certificate.
The City shall comply with the provisions of this section unless, in the written opinion of
Bond Counsel to the City, such compliance is not required to maintain the exemption of the
interest on the Bond from federal income taxation.
The City hereby covenants that it will comply with the covenants set forth in the Federal
Tax Certificate. The City shall take such additional actions as are required to qualify such Bond
as a Qualified Energy Conservation Bond, to maintain such qualification, and to seek
reimbursement of the applicable federal subsidy in the future on a timely basis.
The City has not designated the Bond as a "qualified tax-exempt obligation" within the
meaning of Section 265(b) of the Code.
Section 9. Pled�e of Funds and Credit; General Obli�ation. The City hereby
authorizes the creation of a fund to be used for the payment of debt service on the Bond,
designated as the "Bond Redemption Fund" (the "Bond Fund"). No later than the date each
payment of principal of or interest on the Bond becomes due, the City shall transmit sufficient
funds, from the Bond Fund or from other legally available sources,to the Bond Registrar for the
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payment of such principal or interest. Money in the Bond Fund may be invested in legal
investments for City funds.
The City hereby irrevocably covenants and agrees for as long as the Bond is 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
other revenues and money of the City legally available for such purposes, to pay the principal of
and interest on the Bond 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 Bond will be and is hereby irrevocably set aside, pledged and appropriated for
the payment of the principal of and interest on the Bond. 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 Bond when due.
Section 10. Prepavment and Redemption. If the Bond is prepaid in accordance with
this Section 10, interest shall cease to accrue on the date the Purchaser receives such
prepayment. [for discussion only—to be revisedj
(a) Optional Redemption. The Bond may be prepaid, in whole or in part,on any date
at the Make Whole Amount. For purposes of this Section, the "Make Whole Amount" is the
excess, if any, of(1) the sum of the present values (determined as of the date of prepayment)
of all remaining scheduled payments of principal and interest on the Bond from the date of
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prepayment to the maturity date, discounted at a rate equal to the yield on the interpolated US
Treasury obligation having a weighted average to that of the Bond at the time of prepayment
plus 50 basis points, over(2)the principal amount of the Bond being prepaid.
(b) Extraordinary Optionol Redemption. The Bond may be redeemed prior to
maturity at any time at a price of par, plus accrued interest,to the date of redemption upon the
occurrence of an "Extraordinary Event," For purposes of this Section, an "Extraordinary Event"
will have occurred if the City determines that a material adverse change has occurred to
Sections 54A, 54D, or 5431 of the Code or any other applicable section of the Code,or if there is
any guidance published by the Internal Revenue Service ("IRS") or the United States
Department of the Treasury (the "Treasury") with respect to such sections or any other
determination by the IRS or Treasury, which determination is not the result of any act or
omission by the City to satisfy the requirements to qualify to receive the fiederal credit
payments related to the Bond, pursuant to which the City's federal credit payments are
reduced or eliminated, or the IRS or Treasury announces its intent to reduce or eliminate the
federal credit payment.
(c) Extraordinory Mandatory Redemption. The Bond is subject to extraordinary
mandatory redemption, in whole or in part, on a date no later than three years after the date of
issuance of the Bond, or, in the event of an extension negotiated with the IRS, on any date not
later than 90 days after the end of such extension period, at a redemption price equal to the
principal amount of the Bond called for redemption plus accrued interest, in an amount equal
to the unexpended proceeds of the sale of the Bond held by the City, but only to the extent that
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the City fails to expend all of the proceeds of the Bond within three years of issuance thereof
and no extension of the period for expenditures has been granted by the IRS.
Section 11. Sale of the Bond. The Bond shall be sold to the Purchaser pursuant to the
terms of this ordinance and the Purchaser's Proposal. The City hereby accepts the Purchaser's
Proposal, which is attached as Exhibit A. The Finance Director is hereby authorized to approve
the Interest Rate and the principal amount of the Bond and to agree to any other terms,
conditions and covenants that are in the best interest of the City and in accordance with the
Purchaser's Proposal so long as (a) the principal amount of the Bond does not exceed
$3,200,000, and (b) the Interest Rate for the Bond does not exceed [_)%.
The appropriate City officials, including but not limited to the Mayor, the Chief
Administrative Officer, and the Finance Director, are hereby authorized and directed to do
everything necessary for tfie prompt issuance, execution and delivery of the Bond and for the
proper application and use of the proceeds thereof.
Section 12. On�oin� Disclosure: Covenants.
(a) Ongoing Disclosure. The Bond is exempt from ongoing disclosure requirements
of the Rule.
(b) Covenants. So long as the Bond is outstanding, the City hereby covenants and
agrees as follows:
(1) To provide the Purchaser copies of the City's audited financial statements
promptly after such statements become available; and
(2) To provide financial or other information as may be reasonably requested
in writing from time to time.
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Section 13. Lost, Stolen or Destroyed Bond. In case the Bond shall be lost, stolen or
destroyed while in the Registered Owner's possession,the Bond Registrar may at the request of
the Registered Owner execute and deliver a new Bond 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 its filing with the City written
certification that such Bond was actually lost, stolen or destroyed and of its ownership thereof.
In the case the Bond shall be lost, stolen, or destroyed while in the Registered Owner's
possession,the Registered Owner may elect upon final payment of principal and interest of the
Bond to surrender a photocopy of the Bond for cancellation at the office of the Bond Registrar
together with written certification that such Bond was actually lost, stolen or destroyed and of
its ownership thereof.
Section 14. Severabilitv; Ratification. If any one or more of the covenants or
agreements provided in this ordinance ta 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 Bond. All acts taken pursuant to the authority
granted in this ordinance but prior to its effective date are hereby ratified and confirmed.
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Section 15. 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 day of . 2013.
Bonnie I. Walton, City Clerk
APPROVED BY THE MAYOR this day of ,2013.
Denis Law, Mayor
Approved as to form:
Pacifica Law Group LLP
Bond Counsel
Date of Publication:
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Exhibit A
Purchaser's Proposal
(attached)
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CERTIFICATE
I, the undersigned, the Clerk of the City Council (the "City Council") of City of Renton,
Washington (herein called the "City"), DO HEREBY CERTIFY:
1. That the attached ordinance numbered (herein called the
"Ordinance") is a true and correct copy of an ordinance of the City, as finally adopted at a
regular meeting of the City Council held on the _ day of . 2013, and duly
recorded in my office.
2. That the meeting was duly convened and heid 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
quorum of the City Council was present throughout the meeting and a legally sufficient number
of inembers of the City Council voted in the proper manner for the passage of said Ordinance;
that all other requirements and proceedings incident to the proper adoption of said 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_day of , 2013.
Bonnie I. Walton, City Clerk