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HomeMy WebLinkAboutORD 4211 wi ,• • ',� , �� . � • � �}m�.�e� b� o(ZO.� �3 5�� �i'��/��; ' 1 � ' CITY OF RENTON, WASHINGTON ORDINANCE N0. 4211 AN ORDINANCE relating to the waterworks utility of the City, including the sewerage system as a part thereof ; specifying and adopting a system or plan of additions to and betterments and extensions of the waterworks utility; providing for the issuance of $1, 715, 000 par value Water and Sewer Revenue Bonds, 1989 , of the City for the purpose of obtaining a part of the funds with which to pay the cost of carrying out that system or plan; fixing the date, form, denominations, maturities, interest rates, terms and covenants of those bonds; creating a special bond redemption account to provide for the payment of the bonds; ratifying and confirming the public sale of those bonds; and accepting the bid of and providing for the delivery of those bonds to Seattle-Northwest Securities Corporation, Seattle, Washington. WHEREAS, by Ordinance No. 1156, as amended by Ordinances Nos . 1157 and 1173 , the sewerage system of the City of Renton (the "City" ) has become and is considered a part of the water- works utility of the City (defined below as the "Waterworks Utility") ; and WHEREAS, by Ordinance No . 2020 the system of storm or surface water sewers was determined to consist as a part of the ��- sewerage system and, together with the sewerage system, combined with the Waterworks Utility; and r ' • - t � a ' ► ORDINANCE NO. 4211 � �� � WHEREAS, by Ordinance No . 1450, the City provided for the issuance of its Water and Sewer Refunding and Improvement Reve- nue Bonds, 1953 (the "1953 Bonds" ) , and, by Section 15 of that ordinance, established certain conditions for the issuance of additional water and sewer revenue bonds on a parity of lien with the 1953 Bonds ; and WHEREAS, all of the water and sewer revenue bonds of the City issued on a parity of lien with the 1953 Bonds pursuant to the original provisions of Section 15 of Ordinance No. 1450 have been paid and redeemed, or irrevocable provision for their payment and redemption has been made; and WHEREAS, by Ordinance No. 3169 , the City authorized the issuance of its Water and Sewer Revenue Refunding Bonds, 1977, Issue No. 2 (the "1977 Bonds, Issue No . 2" ) , and, by Section 13 of that ordinance, incorporated and amended Section 15 of Ordi- nance No. 1450, all of which bonds have been paid and redeemed; and WHEREAS, by Ordinance No. 3188, the City authorized the issuance of its Water and Sewer Revenue Refunding Bonds , Issue No. 3 (the "1977 Bonds , Issue No . 3" ) , and by Section 13 of that ordinance incorporated Section 15 of Ordinance No . 1450, as modified by Section 13 of Ordinance No . 3169 ; and WHEREAS, by Ordinance No . 3720, the City authorized the issuance of its Water and Sewer Revenue Bonds, 1983 (the "1983 Bonds" ) , and, by Section 12 of that ordinance further modified - 2 - , . - , � �� � ORDINANCE N0. 4211 . �� • and strengthened the provisions of Section 15 ot Ordinance No . 1450, as modified by Section 13 of Ordinance No . 3169 ; and WHEREAS, the City presently has outstanding, in addition to the 1977 Bonds, Issue No . 3 , and 1983 Bonds, its Water and Sewer Revenue Bonds, 1985 (the "1985 Bonds" ) , issued pursuant to Ordinance No . 3896, Water and Sewer Revenue Bonds, 1986 (the "1986 Bonds" ) , issued pursuant to Ordinarice No . 3970, Water and Sewer Revenue Bonds, 1987 (the "1987 Bonds" ) , issued pursuant to Ordinance No . 4068 and Water and Sewer Revenue Bonds, 1988 (the "1988 Bonds" ) , issued pursuant to Ordinance No . 4157, all of which bonds were issued on a parity of lien with the 1977 Bonds, Issue No . 3 ; and WHEREAS, the parity provisions of Section 13 of Ordinance No. 3188, which incorporated therein Section 15 of Ordinance No . 1450, as modified by Section 13 of Ordinance No . 3169, and as further modified and strengthened by Section 12 of Ordinance No . 3720, provide that the City may issue additional water and sewer revenue bonds which will constitute a charge and lien upon the revenue of the Waterworks Utility of the City on a parity with the 1977 Bonds , Issue No. 3 , the 1983 Bonds, the 1985 Bonds, the 1986 Bonds, the 1987 Bonds, the 1988 Bonds and any bonds issued thereafter and having a charge and lien upon the revenue of the Waterworks Utility on a parity with those bonds on compliance at the time of the issuance of such additional bonds with the following conditions : - 3 - t • ' � ' 4� ORDINANCE NO. 4211 ,� , , " (A) All payments required by any ordinance to be paid into any bond redemption funds and accounts thereof created to secure the payment of bonds issued on a parity of lien herewith shall have been made into the respective bond redemption funds and accounts thereof for the payment of such bonds and no deficiency exists therein; and " (B) The revenues of said waterworks system, including the sewerage system, shall be and be deemed sufficient, after the payment of operation and maintenance costs and taxes, based upon the historical experience of said systems or the pro forma revenues under then existing rates over a period of any twenty-four consecutive months out of the thirty-six months immediately preceding the time of the issuance of such additional bonds, to equal at least 1 . 3 times the average annual principal and interest requirements of the bonds of this issue then outstandirig and of the revenue bonds propose� to be so issued. Such determination of the sufficiency of the revenues shall be made and certified to by an engineer experienced in municipal utilities; and " (C) The ordinance authorizing the issuance of such additional revenue bonds shall provide for the setting aside into a reserve fund or account of an amourit not less than the average annual debt service requirement, both principal and interest of the additional revenue bonds proposed to be so issued, which reserve fund or account shall be maintained in such amount so long as any of said bonds are outstanding to the last maturity thereof" ; � and WHEREAS, on June 11, 1984 , the City Council passed and the Mayor approved Resolutions Nos . 2546 and 2547 adopting the 1983 Comprehensive Sanitary Sewer Plan and 1983 Comprehensive Water System Plan, respectively, for the City, but for the purpose of financing facilities in those plans it is necessary to specify and adopt them by ordinance; and WHEREAS, the City Council has determined that it is neces- sary and in the best interests of the City that certain addi- tional improvements described in the 1983 Comprehensive Water - 4 - � s � ORDINANCE N0. 4211 System Plan and the 1983 Comprehensive Sanitary Sewer Plan be made and there be adopted a system or plan of additions to and betterments and extensions of the Waterworks Utility; and WHEREAS, the City Council has determined that it is neces- sary to issue and sell $1, 715, 000 par value of water and sewer revenue bonds to provide a part of the funds necessary to carry out the system or plan providing for additions to and better- ments and extensions of the Waterworks Utility and to pay the costs of issuance and sale of the water and sewer revenue bonds provided for herein; and WHEREAS, the City caused notice of sale of bonds to be published in the "Daily Journal of Commerce" in Seattle, Wash- inqton, and specified in that notice of sale that bids would be received by the City Finance Director until 11 : 00 a .m. on April 17, 1989 , in his office in the City Hall and two bids were received; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON, DO ORDAIN, as follows : SECTION I . Definitions . As used in this ordinance, the following words shall have the following meanings : "Annual Debt Service" for the Bonds shall mean all the interest plus all principal which will mature or come due in any year . "Average Annual Debt Service" shall mean the sum of the Annual llebt Service for the remaining years to the last - 5 - ' � � ORDINANCE NO. 4211 , . , scheduled maturity of the Bonds divided by the number of those years . "Bond Fund" shall mean that special fund of the City known as the 1989 Water and Sewer Revenue Bond Redemption Account created by this ordinance as a separate account in the Water and Sewer Revenue Parity Bond Fund for the payment of the principal of and interest on the Bonds . "Bond Registrar" shall mean the fiscal agencies of the State of Washington in Seattle, Washington, and New York, New York, as the same shall be designated from time to time. "Bonds" shall mean the $1, 715, 000 par value City of Renton Water and Sewer Revenue Bonds, 1989 , authorized to be issued by this ordinance. "City" shall mean the City of Renton, Washington, a duly organized and legally existing noncharter code city under the laws of the State of Washington. "Future Parity Bonds" shall mean all water and sewer revenue bonds of the City issued after the date of the issuance of the Bonds and having a lien arid charge on the Revenue of the Waterworks Utility on a parity with tYie lien and charge on such Revenue for the payment of the principal of and interest on the Outstanding Parity Bonds and the Bonds . "Maintenance and Operation Expense" shall mean all expenses incurred by the City in causing the Waterworks Utility to be operated arid maintained in good repair, working order and - 6 - ' ' �� � ORDINANCE N0. 4211 , , � condition, which shall not include any depreciation expenses or taxes or charges in lieu of taxes levied or imposed by the City. "Outstanding Parity Bonds" shall mean the 1977 Bonds, Issue No. 3 , the 1983 Bonds, the 1985 Bonds, the 1986 Bonds, the 1987 Bonds and the 1988 Bonds . "Principal and Interest Account" shall mean the subaccount of that name created in the Bond Fund by this ordinance for the payment of the principal of and interest on the Bonds . "Reserve Account" shall mean the subaccount of that name created in the Bond Fund by this ordinance for the purpose of securing the payment of the principal of and interest on the Bonds . "Revenue of the Waterworks Utility" shall mean all the earnings and revenue received by the Waterworks Utility from any source whatsoever, including payments received under contract with other municipal corporations for water service, except general taxes, charges in lieu of taxes, assessments in any utility local improvement district hereafter created, proceeds from the sale of City property, bond proceeds and earnings subject to a federal tax or rebate requirement . "Term Bonds" shall mean any Outstanding Parity Bonds and/or Future Parity Bonds identified as such in the ordinance author- izing the issuance thereof, the payment of which is provided for by a requirement for mandatory deposits of money into the principal and interest account of the bond redemption fund - 7 - ` � � ORDINANCE N0. 4211 � created for the payment of such issue of bonds in accordance with a mandatory sinking fund requirement . "Water and Sewer Revenue Parity Bond Fund" shall mean the fund of that name created by Ordinance No. 3896 . "Waterworks Utility Fund" shall mean that special fund of the City into which all of the Revenue of the Waterworks Utility (except for earnings in any special fund for the redemption of revenue obligations of the Waterworks Utility) shall be deposited. "Waterworks Utility" shall mean the combined water and sewerage systems, including the storm and surface water sewers, of the City as the same may be added to, improved and extended for as long as any of the Outstanding Parity Bonds, the Bonds and any Future Parity Bonds are outstanding . SECTION II . Adoption of Plan of Additions and Betterments . The City specifies, adopts and orders the carrying out of a system or plan of additions to and betterments and extensions of the Waterworks Utility consisting of the improve- ments, acquisitions and work described in Exhibit A attached hereto and by this reference made a part hereof . There shall be included in the foregoing system or plan the acquisition and installation of all necessary valves, pumps, fittings, couplings, connections, equipment and appurtenances, the acquisition of any easements , rights-of-way and land that - 8 - ' � � ORDINANCE N0. 4211 , may be required and the performance of such work as may be incidental thereto and necessary. Al1 of the foregoing shall be in accordance with the plans and specifications therefor prepared by the City' s engineers and consulting engineers . The City Council may modify the details of the foregoing system or plan where, in its judgment, it appears advisable if such modifications do not substantially alter the purposes of that system or plan. The life of the improvements comprising the foregoing system or plan of additions to and betterments and extensions of the Waterworks Utility is declared to be at least twenty years . The estimated cost of the acquisition, construction, installa- tion and financing of the above-described improvements, includ- ing the costs of issuance and sale of the Bonds, is declared to be approximately $4 , 020, 537. That cost shall be paid from the proceeds of the Bonds authorized in this ordinance, proceeds of grants anticipated to be received by the City and other money of or received by the City which is made available therefor . SECTION III . Findinas Reaardina Paritv Provisions . The City Council finds that all payments required by Ordinances Nos . 3169 , 3188, 3720, 3896, 3970, 4068 and 4157 for the Out- standing Parity Bonds have been made into the respective bond redemption funds and accounts therein for the Outstanding Parity Bonds, that provision hereinafter is made for the accumulation - 9 - ' �J ' ORDINANCE N0. 4211 � , of the amounts required in the Reserve Account of the Bond Fund, and that there will be on file prior to the issuance and deliv- ery of the Bonds a certificate of Richard H. Harbert of RH2 Engineering, P. S. , an enqineer experienced in municipal utili- ties, that the Revenue of the Waterworks Utility is sufficient to meet the 1. 3 coverage requirement of those ordinances . SECTION IV. Authorization of Bonds and Acceptance of Bid. For the purpose of providing a part of the money required to carry out the system or plan of additions to and betterments and extensions of the Waterworks Utility, including the cost of issuance and sale of the Bonds, as herein specified, adopted and ordered to be carried out, the City shall issue the Bonds in the aggregate principal amount of $1, 715, 000, and the City accepts the bid of and shall sell to Seattle-Northwest Securities Corporation of Seattle, Washington, all of the Bonds under the terms and conditions herein set forth. SECTION V. Descrintion of Bonds . The Bonds shall be designated City of Renton Water and Sewer Revenue Bonds, 1989 (defined above as the "Bonds" ) ; shall be dated May l, 1989 ; shall be in the denomination of $5, 000 or any integral multiple thereof within a single maturity; shall be numbered separately in the manner and with any additional designation as the Bond Registrar deems necessary for the purpose of identification; and shall bear interest at the rates set forth below, computed on the basis of a 360-day year of twelve 30-day months, payable on - 10 - ' 1 � ORDINANCE N0. 4211 , November l, 1989 , and semiannually thereafter on each succeeding May 1 and November 1 . The Bonds shall bear interest at the rates and mature on May 1 in years and amounts as follows : Maturity Interest Years Amounts Rates 1990 $ 40, 000 6 . 85% 1991 40, 000 6 . 90 1992 45, 000 6 . 95 1993 50, 000 7 . 00 1994 50, 000 7 . 00 1995 55 , 000 7 . 00 1996 60 , 000 7 . 00 1997 65 , 000 7. 10 1998 70, 000 7 . 20 1999 75, 000 7 . 25 2000 80, 000 7 . 25 2001 85, 000 7 . 30 2002 95, 000 7 . 30 2003 100, 000 7 . 40 2004 110, 000 7 . 40 2005 120, 000 7 . 40 2006 125, 000 7 .40 2007 140, 000 7 . 50 2008 150, 000 7 . 50 2009 160, 000 7 . 50 SECTION VI . Reaistration and Transfer of Bpnds . The Bonds shall be issued only in registered form as to both principal and interest and recorded on books or records maintained by the Bond Registrar (the "Bond Register" ) . The Bond Register shall contain the name and mailinq address of the owner of each Bond and the principal amount and number of each of the Bonds held by each owner . Bonds surrendered to the Bond Registrar may be exchanged for Bonds in any authorized denomination of an equal aggregate principal amount and of the same interest rate and maturity. - 11 - i � ' ORDINANCE N0. 4211 , , Bonds may be transferred only if endorsed in the manner provided thereon and surrendered to the Bond Registrar . Any exchange or transfer shall be without cost to the owner or transferee. The Bond Registrar shall not be obligated to exchange or transfer any Bond during the fifteen days preceding any principal payment or redemption date. SECTION VII . Pavment of Bonds . Both principal of and interest on the Bonds shall be payable in lawful money of the United States of America. Interest on the Bonds shall be paid by checks or drafts mailed by the Bond Registrar on the interest payment date to the registered owners at the addresses appearing on the Bond Register on the fifteenth day of the month preceding the interest payment date. Principal of the Bonds shall be payable upon presentation and surrender of the Bonds by the registered owners at either of the principal offices of the Bond Registrar at the option of the owners . The Bonds shall be payable solely out of the Bond Fund and shall be a valid claim of the owners thereof only as against the Bond Fund and the amount of the Revenue of the Waterworks Utility pledged to �hat fund and shall riot be general obligations of the City. SECTION VIII . Optional Redemption and Open Market Purchase of Bonds . Bonds maturing in the years 1990 through 1999 , inclusive, shall be issued without the right or option of the City to redeem those Bonds prior to their stated maturity dates . The City reserves the right and option to redeem Bonds - 12 - ' � � ORDINANCE N0. 4211 , maturing on or after May l, 2000, prior to their stated maturity dates from funds from any source as a whole at any time on or after May 1, 1999 , or in part, by lot in such manner as the Bond Registrar shall determine within one or more maturities selected by the City, on May l, 1999, or on any interest payment date thereafter, at par plus accrued interest to the date fixed for redemption. Portions of the principal amount of any Bond, in install- ments of $5, 000 or any integral multiple thereof, may be redeemed. If less than all of the principal amount of any Bond is redeemed, upon surrender of that Bond at either of the principal offices of the Bond Registrar, there shall be issued to the registered owner, without charge therefor, a new Bond (or Bonds at the option of the registered owner) of the same inter- est rate and maturity in any of the denominations authorized by this ordinance in the aggregate total principal amount remaining unredeemed. The City further reserves the right and option to purchase any or all of the Bonds in the open market at any time at a price not in excess of par plus accrued interest to the date of purchase. All Bonds purchased or redeemed under this section shall be cancelled. SECTION IX. Notice of Redemption. The City shall cause notice of any intended redemption of Bonds to be given not less - 13 - ' � ORDINANCE NO. 4211 , than 30 nor more than 60 days prior to the date fixed for redemption by first-class mail, postage prepaid, to the regis- tered owner of any Bond to be redeemed at the address appearing on the Bond Register at the time the Bond Registrar prepares the notice, and the requirements of this sentence shall be deemed to have been fulfilled when notice has been mailed as so provided, whether or not it is actually received by the owner of any Bond. Interest on Bonds called for redemption shall cease to accrue on the date fixed for redemption unless the Bond or Bonds called are not redeemed when presented pursuant to the call . In addition, the redemption notice shall be mailed within the same period, postage prepaid, to Moody' s Investors Service, Inc . , and Standard & Poor ' s Corporation at their offices in New York, New York, or their successors, to Seattle-Northwest Securities Corporation, at its principal office in Seattle, Washington, or its successor, and to such other persons and with such addi- tional information as the City Finance Director shall determine, but these additional mailinqs shall not be a condition precedent to the redemption of Bonds . SECTION X. Failure to Redeem Bonds . If any Bond is not redeemed when properly presented at its maturity or call date, the City shall be obligated to pay interest on that Bond at the same rate provided in the Bond from and after its maturity or call date until that Bond, both principal and interest , is paid in full or until sufficient money for its payment in full is on - 14 - ' � ORDINANCE N0. 4211 , deposit in the Bond Fund and the Bond has been called for payment by giving notice of that call to the registered owner of each of those unpaid Bonds . SECTION XI . Creation of Account and Subaccounts : Deposits into Accounts . There is created the 1989 Water and Sewer Revenue Bond Redemption Account (heretofore defined as the Bond Fund) which shall be a separate bond redemption account within the Water and Sewer Revenue Parity Bond Fund. The Bond Fund is divided into two subaccounts, the Principal and Interest Account and the Reserve Account . So long as Bonds are outstanding against the Bond Fund, the City Finance Director shall (a) set aside and pay into the Principal and Interest Account out of the Revenue of the Waterworks Utility a fixed amount, without regard to any fixed proportion, namely, monthly, on or before the first day of each month beginning with the month of May 1989 , an amount, together with the accrued interest received on the delivery of the Bonds to the initial purchaser thereof or other money on deposit therein, equal to 1/6 of the next ensuing six months ' requirements for interest and 1/12 of the amount of principal of the Bonds payable on the next ensuing principal payment date and continuing thereafter until the Bonds , both principal and interest, are paid in full, and (b) set aside and pay into the Reserve Account out of the Revenue of the Water- works Utility in substantially equal monthly payments such amounts so that by no later than May l, 1994 , there shall have - 15 - ' � ORDINANCE NO. 4211 , been accumulated in the Reserve Account for the Bonds an amount not less than the Average Annual Debt Service for the Bonds . The Reserve Account in the Bond Fund may be accumulated from any other money which the City may have available for that purpose in addition to or in lieu of using revenue therefor . The City further agrees that when the required amounts have been paid into the Reserve Account in the Bond Fund, the City will maintain those amounts therein at all times, except for withdrawals therefrom as authorized herein, until there is sufficient money in the Bond Fund, including the Reserve Account therein, to pay the principal of and interest to maturity on all outstanding Bonds, at which time no further payments need be made into the Bond Fund, and the money in the Bond Fund, includ- ing the Reserve Account, may be used to pay that principal and interest . In the event there shall be a deficiency in the Principal and Interest Account to meet maturing installments of either principal or interest, as the case may be, on the Bonds, the deficiency shall be made up from the Reserve Account by the withdrawal of cash therefrom for that purpose. Any deficiency created in the Reserve Account by reason of any withdrawal shall then be made up from the Revenue of the Waterworks Utility first available after making necessary provisions for the required payments into the Principal and Interest Account . - 16 - ' � ORDINANCE N0. 4211 � All money in the Reserve Account not needed to meet the payments of principal and interest when due may be kept on deposit in the official bank depository of the City or in any national bank or may be invested in any legal investment for City funds maturing not later than the interest or principal and interest payment date when the money will be needed. Interest on any of those investments or on that bank account shall be deposited in and become a part of the Reserve Account until the total required reserve amount shall have been accumulated therein, after which time the interest shall be deposited in the Principal and Interest Account . Notwithstanding the provisions for the deposit or mainten- ance of earnings in accounts of the Bond Fund, any earnings which are subject to a federal tax or rebate requirement may be withdrawn from the Bond Fund for deposit into a separate fund or account for that purpose. If the City shall fail to set aside and pay into the Bond Fund the amounts set forth above, the owner of any of the outstanding Bonds may brinq an action against the City to compel that setting aside and payment . SECTION XII . Flow of Funds . Funds in the Waterworks Utility Fund (other than in any bond redemption or federal rebate account) shall be used in the following order of priority: (a) To pay Maintenance and Operation Expense; (b) To pay the interest on the Outstanding Parity Bonds, the Bonds and any Future Parity Bonds; - 17 - ' � ORDINANCE N0. 4211 , (c) To pay the principal of the Outstanding Parity Bonds, the Bonds and any Future Parity Bonds; (d) To make all payments required to be made into any sinking fund or bond redemption fund here- after created for the payment of Future Parity Bonds which are Term Bonds; (e) To make all payments required to be made into the reserve accounts created to secure the payment of the Outstanding Parity Bonds, the Bonds and any Future Parity Bonds; (f) To make all payments required to be made into any revenue bond optional redemption fund or warrant redemption fund and debt service account or reserve account created to pay and secure the payment of the principal of and interest on any revenue bonds or revenue warrants of the City having a lien upon the Revenue of the Waterworks Utility junior and iriferior to the lien thereon for the payment of the principal of and interest on the Outstanding Parity Bonds, the Bonds and any Future Parity Bonds; and (g) To retire by optional redemption or purchase in the open market any outstanding revenue bonds or revenue warrants of the City, to make necessary additions, betterments, improvements and repairs to or extensions and replacements of the Water- works Utility or for any other lawful City purpose. SECTION XIII . Pledae of Revenue and Lien Positipn. The Revenue of the Waterworks Utility is pledged to the payments set forth in Section XI , and the Bonds shall constitute a lien and charge on that revenue prior and superior to any other charges whatsoever, excluding Maintenance and Operation Expense, except that the lien and charge on such revenue for the Bonds shall be on a parity with the lien and charge thereon for the Outstanding Parity Bonds and any Future Parity Bonds hereafter issued. - 18 - ' � ORDINANCE N0. 4211 SECTION XIV. Findinas Reaardina Sufficiencv of Revenue. In the judgment of the City Council, the Revenue of the Water- works Utility and benefits to be derived from the operation and maintenance of the Waterworks Utility, at the rates to be charged for water, sanitary sewage disposal service and storm and surface water drainage service in the entire utility, will be more than sufficient to meet all Maintenance and Operation Expense (and cost of maintenance and operation of the Waterworks Utility as that term is used in RCW 35 . 92 . 100) and the debt service requirements of the Outstanding Parity Bonds and to permit the setting aside in the Bond Fund, out of the revenue of the entire utility, of amounts sufficient to pay the interest on the Bonds as that interest becomes payable and to pay and redeem all of the Bonds at maturity. The City Council further declares that in creating the Bond Fund and in fixing the amounts to be paid into the same, as aforesaid, it has exercised due regard for the Maintenance and Operation Expense (and costs of mainten- ance and operation as used in RCW 35 . 92 . 100) and the debt service requirements of the presently outstanding Outstanding Parity Bonds, and the City has not bound and obligated itself to set aside and pay into the Bond Fund a greater amount or propor- tion of the revenue of that utility than in the judgment of the City Council will be available over and above Maintenance and Operation Expense (and such costs of maintenance and operation) and debt service requirements of the Outstanding Parity Bonds - 19 - ' � ORDINANCE NO. 4211 and that no portion of the Revenue of the Waterworks Utility has been previously pledged for any unrefunded indebtedness other than the payment of the presently outstanding Outstanding Parity Bonds . SECTION XV. Covenants . The City covenants and agrees with the owner of each Bond at any time outstanding as follows : (a) It will establish, maintain and collect such rates and charges for water, sanitary sewage disposal service and storm and surface water drainage service so long as any Outstanding Parity Bonds and Bonds are outstanding as will make available for the payment of the principal of and interest on such bonds an amount equal to at least 1 .3 times the average anrival debt service requirements, both principal and interest, on the Outstanding Parity Bonds and the Bonds after deducting Maintenance and Operation Expense from the Revenue of the Waterworks Utility. "Average annual debt service requirements" shall mean the aggregate amount of principal and interest payable in each year over the remaining life of such Outstanding Parity Bonds and Bonds divided by the number of maturity years remaining to the last maturity of the longest maturing issue, being the year 2009 . (b) It will at all times maintain and keep the Waterworks Utility in good repair, workirig order and condition and also will at all times operate such Utility and the business in connection therewith in an efficient manner and at a reasonable cost . (c) It will not sell, lease, mortgage or in any manner encumber or dispose of all the property of the Waterworks Utility unless provision is made for payment into each of the respective bond redemption funds or accounts for the Outstanding Parity Bonds and the Bond Fund of sums sufficient to pay, respec- tively, the principal of and interest on all Out- standing Parity Bonds and the Bonds at any time outstanding, and that it will not sell , lease, mortgage, or in ariy manner encumber or dispose of any part of the property of the Waterworks Utility that is used, useful and material to the operation thereof, unless provision is made for replacement - 20 - ' ` ORDINANCE N0. 4211 thereof, or for payment into the respective bond redemption funds or accounts for the Outstanding Parity Bonds and the Bond Fund of the total amount of revenue received which shall not be less than an amount which shall bear the same ratio to the amount of the Uutstanding Parity Bonds and Bonds, respec- tively, as the revenue available for debt service for such outstanding bonds for the twelve months preced- ing such sale, lease, encumbrance or disposal from the portion of the utility sold, leased, encumbered or disposed of bears to the revenue available for debt service for such bonds from the entire utility for the same period. Any such money so paid into such funds shall be used to retire such outstanding bonds at the earliest possible date. (d) It will while any of the Bonds remain outstandinq keep proper and separate accounts and records in which complete and separate entries shall be made of all transactions relating to the Water- works Utility, and it will furnish the original purchaser or purchasers of the Bonds or any subse- guent owner or owners thereof at the written request of such owner or owners complete operating and income statements of such utility in reasonable detail issued in any calendar year not more than ninety days after the close of such calendar year, and it will grant any owner or owners of at least twenty-five percent of the outstanding Bonds the right at all reasonable times to inspect the entire Waterworks Utility and all records, accounts and data of the City relating thereto. Upon request of any owner of any of the Bonds, it also will furnish to such owner a copy of the most recently completed audit of the City' s accounts by the State Auditor of Washington. (e) It will not furnish water, sanitary sewage disposal service or storm and surface water drainage service to any customer whatsoever free of charge and promptly will take legal action to enforce collection of all delinquent accounts . (f) It will carry the types of insurance on the Waterworks Utility properties in the amounts normally carried by private water and sewer companies engaged in the operation of water and sewerage systems, and the cost of such insurance shall be considered a part of operating and maintaininq such utility. If, as, and when the United States of America or some agency thereof shall provide for war risk insurance, the - 21 - ' � ORDINANCE N0. 4211 , � City further agrees to take out and maintain such insurance on all or such portions of such utility on which such war risk insurance may be written in an amount or amounts to cover adequately the value thereof . (g) It will pay all Maintenance and Operation Expense and the debt service requirements for the Outstanding Parity Bonds and the outstandirig Bonds, and otherwise meet the obligations of the City as herein set forth. (h) It will take all actions necessary to prevent interest on the Bonds from beinq included in gross income for federal income tax purposes , and it will neither take any action nor make or permit any use of proceeds of the Bonds or other funds of the City treated as proceeds of the Bonds at any time during the term of the Bonds which will cause inter- est on the Bonds to be included in gross income for federal income tax purposes . The City also covenants that, if all gross proceeds of the Bonds have not been spent within six months after the date of issuance of the Bonds, it will calculate, or cause to be calculated, and rebate to the United States all earnings from the investment of gross proceeds of the Bonds that are in excess of the amount that would have been earned had the yield on those investments been equal to the yield on the Bonds, plus all income derived from those excess earnings, to the extent and in the manner required by Section 148 of the United States Internal Revenue Code of 1986, as amended (the "Code") , and applicable regulations . If the City fails to meet rebate requirements applicable to the Bonds under Section 148 of the Code, the City cove- nants that, to the extent permitted by that Section, it will pay the penalty provided in Subsection 148(f) (7) (C) if required to prevent interest on the Bonds from being included in gross income for federal income tax purposes . The City certifies that it has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whose arbitrage certifica- tions may not be relied upon. - 22 - ' � ORDINANCE N0. 4211 SECTION XVI . Form and Execution of Bonds . The Bonds shall be printed or lithographed on good bond paper in a form consis- tent with the provisions of this ordinance and state law, shall be signed by the Mayor and City Clerk, either or both of whose signatures may be manual or in facsimile, and the seal of the City or a facsimile reproduction thereof shall be impressed or printed thereon. Only Bonds bearing a Certificate of Authentication in the following form, manually signed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of this ordinance: CERTIFICATE OF AUTHENTICATION This bond is one of the fully registered City of Renton, Washington, Water and Sewer Revenue Bonds, 1989, described in the Bond Ordinance. WASHINGTON STATE FISCAL AGENCY Bond Registrar By Authorized Officer The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered and are entitled to the benefits of this ordinance. If any officer whose facsimile signature appears on the Bonds ceases to be an officer of the City authorized to sign bonds before the Bonds bearing his or her facsimile signature - 23 - ` ' ORDINANCE N0. 4211 are authenticated or delivered by the Bond Registrar or issued by the City, those Bonds nevertheless may be authenticated, delivered and issued and, when authenticated, issued and deliv- ered, shall be as binding on the City as though that person had continued to be an officer of the City authorized to sign bonds . Any Bond also may be signed on behalf of the City by any person who, on the actual date of signing of the Bond, is an officer of the City authorized to sign bonds, although he or she did not hold the required office on the date of issuance of the Bonds . SECTION XVII . Bond Reaistrar . The Bond Registrar shall keep, or cause to be kept, at its principal corporate trust office, sufficient books for the registration and transfer of the Bonds which shall be open to inspection by the City at all times . The Bond Registrar is authorized, on behalf of the City, to authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of the Bonds and this ordinance, to serve as the City' s paying agent for the Bonds and to carry out all of the Bond Registrar ' s powers and duties under this ordinance and City Ordinance No. 3755 establishing a system of registration for the City' s bonds and obligations . The Bond Registrar shall be responsible for its representa- tions contained in the Bond Registrar ' s Certificate of Authenti- cation on the Bonds . The Bond Registrar may become the owner of Bonds with the same rights it would have if it were not the Bond - 24 - ' ' ORDINANCE N0. 4211 Registrar and, to the extent permitted by law, may act as depository for and permit any of its officers or directors to act as members of, or in any other capacity with respect to, any committee formed to protect the rights of Bond owners . SECTION XVIII . Bonds Neaotiable. The Bonds shall be negotiable instruments to the extent provided by RCW 62A. 8-102 and 62A. 8-105 . SECTION XIX. Advance Refundina or Defeasance of Bonds . In the event the City shall issue advance refunding bonds pursuant to �he laws of the State of Washington, or have money available from any other lawful source, to pay the principal of and interest on the Bonds or such portion thereof included in the refunding or defeasance plan as the same become due and payable and to refund or defease all such then outstanding Bonds and to pay the costs of refunding or defeasance, and shall have irre- vocably set aside for and pledged to such payment, refunding or defeasance, money and/or direct obligations of the United States of America sufficient in amount, together with known earned income from the investment thereof, to make such paymerits and to accomplish the defeasance or refunding as scheduled (hereinafter called the "trust account" ) and shall make irrevocable provisions for redemption of such Bonds , then in that case the Bonds shall be deemed defeased (hereinafter collectively called tYie "defeased Bonds" ) . Thereafter, all right and interest of the owners of the defeased Bonds in the covenants of this - 25 - � ' ORDINANCE NO. 4211 ordinance, in the Revenue of the Waterworks Utility and in funds and accounts obligated to the paymerit of such Bonds shall cease and become void, except such owners shall have the right to receive payment of the principal of and interest on the defeased Bonds from the trust accourit and, in the event the funds in the trust account are not available for such payment, shall have the residual right to receive payment of the principal of and interest on the defeased Bonds from the Revenue of the Waterworks Utility without any priority of lien or charge against such revenue or covenants with respect thereto except to be paid therefrom. After the establishing and full funding of the trust account, the City may then apply any money in any other fund or account established for the payment or redemption of the defeased Bonds to any lawful purposes as it shall determine, subject only to the rights of the owners of any other bonds then outstanding . In the event the refunding plan provides that the Bonds being refunded or the refunding bonds to be issued be secured by cash and/or direct obligations of the United States of America or other legal investments pending the prior redemption of those Bonds being refunded and if such refunding plan also provides that certain cash and/or direct obligations of the United States of America or other legal investments are pledged irrevocably for the prior redemption of those Bonds included in the - 26 - ' ' ORDINANCE N0. 4211 refunding plan, then only the debt service on the Bonds which are not defeased Bonds and the refunding bonds , the payment of which is not so secured by the refunding plan, shall be included in the computation of coverage for issuance of Future Parity Bonds and the annual computation of coverage for determining compliance with the rate covenants . SECTION XX. Provision for Future Paritv Bonds . The City reserves the right to issue Future Parity Bonds which will constitute a lien and charge on the Revenue of the Waterworks Utility on a parity with the Outstanding Parity Bonds and the Bonds if the conditions set forth in Section 13 of Ordinance No . 3188, as modified and strengthened by Section 12 of Ordinance No. 3720, are met and complied with at the time of the issuance of those Future Parity Bonds, which sections are by this reference incorporated herein and made a part hereof and shall continue to be applicable even though the 1953 Bonds have been paid and retired. SECTION XXI . Denosit of Bond Proceeds . There has been created in the office of the City Finance Director a special fund of the City known and designated as the Water and Sewer Construction Fund, 1983 (the "Construction Fund" ) . The City Finance Director shall deposit the good faith deposit of Seattle-Northwest Securities Corporation (the "Purchaser" ) in the Construction Fund, and that deposit shall remain intact until delivery of the Bonds to the Purchaser but may be invested - 27 - ' ' ORDINANCE NO. 4211 in any legal investment and the investment income may be retained in that fund and used for the purposes of the fund. The principal proceeds received from the issuance and sale of the Bonds shall be deposited in the Construction Fund and shall be used to pay the costs of carrying out the system or plan of additions to and betterments and extensions of the Waterworks Utility specified, adopted and ordered to be carried out by this ordinance and the expenses incurred in the issuance of the Bonds . Pending the expenditure of the principal proceeds out of the Construction Fund, the money in that fund may be invested in any legal investment and the investment income may be retained in that fund and used for the purposes of the fund, except that earnings subject to a federal tax or rebate requirement may be withdrawn from the Construction Fund for those tax or rebate purposes . The accrued interest on the Bonds, if any, received at the time the Bonds are delivered to the Purchaser shall be deposited in the Bond Fund. SECTION XXII . Ratification of Public Sale of Bonds and Notice of Sale. The City Council approves and confirms the Notice of Sale of the Bonds published in the "Daily Journal of Commerce" of Seattle, Washington, and the Notice of Sale of the Bonds as published in the Preliminary Official Statement and published in connection with the Bonds by Seattle-Northwest Securities Corporation, the City' s financial consultant . - 28 - ' ' ORDINANCE N0. 4211 SECTION XXIII . Printina and Deliverv of Bonds . The officers of the City are directed to have the Bonds printed and authenticated immediately. The Bonds shall be delivered to the Purchaser pursuant to its bid upon payment therefor at the price bid, plus accrued interest from the date of the Bonds to their date of delivery. In connection therewith, a certified copy of the transcript of proceedings pertaining to the issuance of the Bonds shall be furnished to Foster Pepper & Shefelman so that their approving legal opinion may be obtained for delivery to the Purchaser in compliance with the requirements of the Notice of Bond Sale and of the bid. Bond counsel shall not be required to review and shall express no opinion concerning the completeness or accuracy of any offical statement, offering circular or other sales material issued or used in connection with the Bonds, and bond counsel ' s opinion shall so state. The proper City officials are authorized and directed to do everything necessary for the prompt execution and delivery of the Bonds to the Purchaser, including the execution of the Official Statement on behalf of the City, and for the proper application and use of the proceeds thereof . SECTION XXIV. Temporarv Bond. Pendirig the printing, execution and delivery to the Purchaser of definitive Bonds, the City may cause to be executed and delivered to the Purchaser a single temporary Bond in the total principal amount of the - 29 - ` ` ORDINANCE N0. 4211 , • Bonds . The temporary Bond shall bear the same date of issuance, interest rates, principal payment dates and terms and covenants as the definitive Bonds, shall be issued as a fully registered Bond in the name of the Purchaser, and otherwise shall be in a form acceptable to the Purchaser . The temporary Bond shall be exchanged for definitive Bonds as soon as they are printed, authenticated and available for delivery. SECTION XXV. Ratification and Confirmation. All actions, includinq the publication by the City Finance Director of the Notice of Sale of the Bonds and the return of the good faith deposits to the unsuccessful bidders, heretofore taken by the City or on its behalf and consistent with the provisions of this ordinance are ratified and confirmed. SECTION XXI . Effective Date of Ordinance. This ordinance shall be effective upon its passage, approval and five days after publication PASSED by the City Council this 17th day of April, 1989 . � � G:�A=-�6'�/ Maxine E. Motor, Cit1� Clerk APPROVED BY THE MAYOR this 1 day of April, 1�£39 . �►_�.�t \����n�A` Earl Clymer, ��or Approved as to Form: � ���..� , v A ril 21 1989 Date of Fublication: P � 2475r - 30 - t t • ` EXHIBIT A Water Svstem Improvements-Maior Comprehensive Plan Update S. Talbot Reservoir and Pipeline Lind Avenue Uridercrossing Lind Avenue Bridge Approach Well Field Protection Water Quality Investigation Maplewood Wells #10 and #11 Springbrook Water Shed Acquisition Sanitarv Sewer Utilitv Improvements Renton Highlands Sanitary 5ewer Earlington Hill Sewer Pump Storm Drainaae Im�rovements-Maior P-1 Box Culvert Under I-405 Comprehensive Plan Panther Creek Acquisition Small Drainage Improvements Oakesdale SW/SCS Grant and 50% Match Reimburse Operating Fund/Soft Capital Operating Equipment 2475r/33