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HomeMy WebLinkAboutORD 4231 �+..e�.� �.. ,« , , �° , . � CITY OF RENTON, WASHINGTON ORDINANCE NO. 4231 AN ORDINANCE relating to Local Improvement District No. 314; providing for the issuance and sale of $2 ,785,000 par value Local Improvement District No . 314 Refunding Bonds of the City for the purpose of obtaining the funds with which to refund, pay and retire the City' s outstanding Local Improvement District No. 314 Bonds ; providing for and authorizing the purchase of certain obligations out of the proceeds of the bonds authorized herein and from other money and the use and application of the money derived from those investments; authorizing the execution of an agreement with Puget Sound National Bank as refunding trustee; fixing the date, form, denominations, maturities , interest rates, terms and covenants of those bonds; providing for and ratifying the call for redemption of certain of the outstanding Local Improvement District No . 314 Bonds; revising the interest rate on assessments in Local Improvement District No. 314; and providing for the sale and delivery of those bonds to Seattle-Northwest Securities Corporation, Seattle, Washington . WHEREAS, the City of Renton, Washington (the "City" ) , by Ordinance No. 3838, authorized the issuance and sale of $6,789 ,084 . 28 par value Local Improvement District No. 314 Bonds (the "LID 314 Bonds" ) ; and WHEREAS, as of September 1 , 1989 , there will be $3 , 140 , 000 principal amount of the LID 314 Bonds outstanding maturinq on September 1 of each of the years 1990 through 1999 (the "Serial Bonds" ) and in 2001 (the "Term Bonds" ) , bearing various interest rates from 9 . 00% to 11 . 125%; and WHEREAS, by Ordinance No. 3838, the City reserved the right to redeem the Term Bonds on September 1, 1985 , and on any T . ' ' ORDINANCE NO. 4231 interest payment date thereafter at par plus accrued interest and further reserved the right , after the payment and redemption of all of the Term Bonds, to redeem the Serial Bonds maturing in the years 1995 through 1999, inclusive, on September 1 , 1994 , at par plus accrued interest; and WHEREAS , the City has determined that it is in the best interests of the City to ( 1) issue its Local Improvement District No . 314 refunding bonds (the "Bonds" ) pursuant to RCW 35 .45 . 170 to provide the money, together with money on deposit in the Local Improvement Fund, District No. 314 (the "Bond Fund" ) , to call , pay and redeem on September 1 , 1989, all of the Term Bonds outstanding and (2) refund the outstanding Serial Bonds in order to effect a net interest cost savings to the property owners within Local Improvement District No. 314 (LID No. 314 ) , which refunding will be effected by: (a) the issuance and sale of the Bonds; (b) the call, payment and redemption of all of the remaining outstanding Term Bonds on September 1 , 1989; and (c) the payment of the principal of and interest on the Serial Bonds when due up to and including September 1, 1994, and, on September 1 , 1994 , the call , payment and redemption of all of the outstanding Serial Bonds at a price of par (the "Refunding Plan" ) ; and - 2 - ORDINANCE NO. 4231 WHEREAS, there are presently special benefit assessments remaining unpaid in LID No . 314 at least in the amount of $2,785, 000 bearing interest at the rate of 11 . 65% per annum; and WHEREAS, Seattle-Northwest Securities Corporation has offered to purchase the Bonds in the principal amount of $2,785, 000 and under the terms and conditions herein set forth; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON, DO ORDAIN, as follows : SECTION I . Description of Bonds . Local Improvement District No. 314 Refunding Bonds (the "Bonds" ) shall be issued in the total principal amount of $2, 785, 000 , being the total amount remaining unpaid on the assessment roll of LID No. 314 , for the purpose of paying part of the cost of carrying out the Refunding Plan and paying the costs of issuance and sale of the Bonds . The Bonds shall be dated September 1, 1989 ; shall be in the denomination of $5 ,000 or any integral multiple thereof within a single maturity; shall be numbered separately and in the manner and with any additional designation as the Bond Registrar (collectively, the fiscal agencies of the State of Washington located in Seattle, Washington, and New York, New York) deems necessary for the purpose of identification; and shall bear interest at the rates set forth below, calculated on the basis of a 360-day year of twelve 30-day months, payable annually beginning September 1 , 1990 . The Bonds shall bear interest at the rates and mature on September 1 in years and amounts as follows : - 3 - ORDINANCE NO. 4231 Maturity Interest Years Amounts Rates 1990 $280 , 000 8 . 875% 1991 280 , 000 8 . 875 1992 280 , 000 8 . 375 1993 280 , 000 8 . 000 1994 280 , 000 8 . 000 1995 280 , 000 7 . 800 1996 280 , 000 7 . 800 1997 275, 000 8 . 000 1998 275, 000 8 . 000 1999 275, 000 8 . 100 SECTION II . Reqistration and Transfer of Bonds . The Bonds shall be issued only in registered form as to both principal and interest and recorded on books or records maintained by the Bond Registrar (the "Bond Register" ) . The Bond Register shall contain the name and mailing address of the owner of each Bond 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. 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 III . Payment of Bonds . Both principal of and interest on the Bonds shall be payable solely out of the Bond Fund, and from the Local Improvement Guaranty Fund of the City, - 4 - ORDINANCE NO. 4231 and shall be payable in lawful money of the United States of America. Interest on the Bonds shall be paid by checks or drafts mailed on the interest payment date to the registered owners at the addresses appearing on the Bond Register on the fifteenth business day of the month preceding the interest payment date . Principal of the Bonds shall be payable on 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 . SECTION IV. Optional Redemption and Open Market Purchase of Bonds . Bonds maturing in the years 1990 through 1994 , inclusive, shall be issued without the right or option of the City to redeem those Bonds prior to their stated maturity dates . The City reserves the right and option to redeem Bonds maturing on or after September 1 , 1995, prior to their stated maturity dates as a whole at any time on or after September 1, 1994 , or in part by lot in such manner as the Bond Registrar shall determine within one or more maturities selected by the City, on September 1, 1994 , 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 installments of $5,000 or any integral multiple thereof, may be redeemed. If less than all of the principal amount of any Bond is redeemed, upon surrender of that Bond at either of the principal offices of the Bond Registrar , there shall be issued - 5 - ORDINANCE NO. 4231 to the registered owner, without charge therefor, a new Bond (or Bonds at the option of the registered owner) of the same maturity and interest rate 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 V. Notice of Redemption. The City shall cause notice of any intended redemption of Bonds to be given not less than 10 nor more than 30 days prior to the date fixed for redemption by first class mail, postage prepaid, to the registered owner of any Bond to be redeemed at the address appearing on the Bond Register at the time the Bond Registrar prepares the notice, and the requirements of this sentence shall be deemed to have been fulfilled when notice has been mailed as so provided, whether or not it is actually received by the owner of any Bond. Interest on Bonds called for redemption shall cease to accrue on the date fixed for redemption unless the Bond or Bonds so called are not redeemed when presented pursuant to the call . SECTION VI . Failure to Redeem Bonds . If any Bond is not redeemed when properly presented at its maturity or call date, - 6 - ORDINANCE NO. 4231 the City shall be obligated to pay interest on that Bond at the same rate provided in the Bond from and after its maturity or call date until that Bond, both principal and interest, is paid in full or until sufficient money for its payment in full is on deposit in the Bond Fund and the Bond has been called for payment by giving notice of that call to the registered owner of that Bond. SECTION VII . Form and Execution of Bonds . The Bonds shall be printed, lithographed or typed on good bond paper in a form consistent with the provisions of this ordinance and State law, shall be signed by the Mayor and the City Clerk, either or both of whose signatures shall 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 executed 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, Local Improvement District No. 314 Refunding Bonds described in the Bond Ordinance. Washington State Fiscal Agency Bond Registrar By Authorized Officer - 7 - ORDINANCE N0. 4231 The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered and are entitled to the benefits of this ordinance. If any officer whose facsimile signature appears on the Bonds ceases to be an officer of the City authorized to sign bonds before the Bonds bearing his or her facsimile signature are authenticated or delivered by the Bond Registrar or issued by the City, those Bonds nevertheless may be authenticated, delivered and issued and, when authenticated, delivered and issued, 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 VIII . Bond Reqistrar . 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 at all times be open to inspection by the City. 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 - 8 - ORDINANCE NO. 4231 ordinance and Ordinance No. 3755 establishing a system of registration for the City' s bonds and obligations . The Band Registrar shall be responsible for its representations cantained in the Registrar ' s Certificate of Authentication on the Bonds. The Bond Registrar rnay become the owner of Bonds with �he same rights it would have if it were nat the Bond Registrar and, ta the extent permitted by law, may act as depositary for and permit any of its officers or directars to act as members of , or in any other capacity with respect to, any cammittee £ormed ta protect the rights of Bond owners . SECTI�N IX. Re£undinq of the LID 314 Bonds . (a) AccN.isition and Substitutic�n of Acquired CJbligatic�ns . The proceeds af �he issuance and sale of �he Bonds, except any accrued interest received which shall be deposi�ed in the Bond Fund, together with any premium and money transferred from the Bond Fund shall be deposited immediate3y u.pon the receipt thereof with Puget Sound National Bank (the "Re�'unding Trustee" ? to discharge the obligations of the City relating to the outstanding LID 314 Bonds under Ordinance No. 3838 by providing for the payment of the amounts required tc� be paid by the Refunding Plan. To the extent practicable and after the payrnent and redemptian of �he Term Bonds , such abligations shall be di.scharged fully by �he Refunding Trustee' s simultaneous purchase of Acquired Qbligations bearing such interest and maturing as to principal and interest in such amounts and at such times sa as to provide for the payment o£ �he amounts - 9 - flRDIN.ANCE NQ. 4231 required to be paid by the Refunding Plan with respect to the Serial Bands . The Acquired Obligations are listed and mare particularly described in Schedule A attached to the Refunding Trust Agreement but are subject to substitution as set for�h below. Priar to the purchase of any such Acquired Obligatians , the City reserves the right to substi�u�e other direct, nancallable obligations of the United States of America { "Government Obligations" ) for any of the Acguired Obligations and to use any savings created �hereby for any lawful City purpose if, (a) in the opinion af Foster Pepper & Shefelman, the City' s band counsel , the interest on the Bonds will remain exeluded from gross income for federal incame tax purposes under Sections 103 , 148 and 149(d) o£ the Internal Revenue Code of 1986, as amended �the "Code" ) , and (b) such substitution shall not impair the timely payment of the amounts required to be paid by the Refunding Plan as so verified by an independent nationally recognized firm of certified public accauntants . After the purchase of the Acquired Obligations by the Refunding Trustee, the City reserves �he right to substitu�e therefar cash or Government Obligations subject to the canditions that such money or securities held by the Refunding Trustee shall be sufficient to carry out the Refunding Plan, that such substit�tion wi12 not cause the Bonds to be arbitrage bonds within the meaning of Sectian 148 0£ the Gode and regulations �hereunder in effect on the date of such - 10 - ORDINANCE N4. 4231 substitution and applicable ta abligations issued on the issue date of �he Bonds , and that the City abtain, at its expense : (1} verification by an independen�G nationaliy recognized firm of certified public accauntants acceptable to the Refunding Trustee confirming that the payments of principal of and interest on the substitute Acquired Obliqations , if paid when due, and any other money held by the Refunding Trustee will be sufficient to carry out the Refunding Plan; and {2} an opinifln from Foster Pepper & Shefelman, bond counsel to the Ci�y, its successor, or other nationally recognized band counsel to the City, to the effect that the disposition and substitution or purchase af such securities , under the sta�utes, rules and regulations �hen in force and applicable to the Bonds, wi11 not cause the interest on the Bonds or the LID 314 Bands to be included in grass income £or federal income tax purposes an.d that such dispasition and substitution ar purchase is in compliance with the sta�u�es and regulations applicable to the Bonds . Any surplus maney resulting fram the sale, transfer, other dispositian or redemption o£ the Acquired Obligations and the substitutions therefar shall be released from the trust estate and transferred to the Bond Fund. (b) Administration af Refundina Plan. The Refunding Trustee is autharized and directed to purchase the Acquired Qbligatians (or substitute obligations) and to make the payments required to be made by the Refunding Plan from the Acquired Obligations (or substitute obliga�ions) and money deposi�ed wi�h - 11 - ORDINANCE NQ. 4231 the Refunding Trustee pursuant to this ordinance. All Acquired Obligations (or substitute obligations) and the money deposi�ed with the Refunding Trustee and any income therefrom shall be held irrevacably, invested and applied in accordance with �he provisions o£ Ordinance No. 3838, this ordinance, Chapter 39 . 53 RCW and other applicable statutes o£ the State of Washingtan, and the Refunding Trust Agreement . All necessary and praper fees, compensation and expenses of the Refunding Trustee for the Bands and all other costs incidental �o the redemption of the Term Bonds and the setting up of the escraw to accomplish the refunding af the outstanding Serial Bonds and costs related to the issuance and delivery of the Bonds , including bond printing, verificatian fees, bond counsel ' s fees and other related expenses, shall be paid out of the praceeds of the Bonds . Ta the extent that Bond proceeds and the Band Fund contribution are insufficient, after the purchase of the Acquired tJbligations and the payrnent and retirement of the Term Bonds, to pay the costs o£ issuance, including underwriter ' s discaunt (which may be deducted from the proceeds of the Bonds paid to the City) , the Genera2 Fund a£ the City shall advance sufficient money to pay those costs af issuance, which advance will be reimbursed fram the first assessment col7.ections paid into the Bond Fund after the date of delivery of the Bands . Any maney remaining after the payment af the costs of issuance af the Bonds shall be returned ta the City and deposited in the Bond Fund. _ �� _ QRDINANCE N0. 4231 (c) Authorization far _Refunding Trust Agreemen�. In order to carry out the Refunding Pian provided £or by this ordinance, the Mayor is autharized and direc�ed to execute and deliver to the Refunding Trustee a Refunding Trust Agreement substantially in the farm an file with the City Clerk and by this reference made a par� hereof setting forth the duties, obligations and responsibili�ies of the Refunding Trustee in connection with the paymen.t, redemptzon and retiremen� of the outstanding LID 314 Bonds as provided herein and stating that the provisions far payment of the fees, compensa�ian and expenses of such Refunding Trustee set £orth therein are satisfactory to it . Prior ta executing �he Refunding Trust Agreer�ient, the Mayor is authorized to rnake such changes therein which do not change the substance and purpase thereof or which assure that the escrow provided therein and �he Bcrnds are in campliance with the requirements of federal law governing the exclusion of in.�erest on the Bonds from gross income for federal incame �ax purpases . SECTION X. Calls for Redemptian of the LID 314 Bonds . The City calls for redemption on September l, 1989, ali of the outstan.dinq Term Bonds at a price o� par plus accrued interest . The City calls for redemption an Sep�ernber 1, 1994 , all of the Serial Bands maturing on Septeznber 1 of the years 1995 through 1999, inclusive, at a price of par plus accrued interest . Such calls Eor redemption shall be irrevacable after the delivery of the Bonds to the initial purchaser thereof . The dates an which the Term Bonds and Serial Bonds are called £or _ �� _ QRDINANCE NQ. 4231 redemptian is the next da�e on which those bands may be cal].ed at a premium of 3% ar less . The proper City afficials are authorized and directed ta give, or cause the Refunding Trustee or Bond Registrar to give, such notices as required, at the times and in the manner required pursuant to Ordinance No. 3838 in order to effect the redemptian prior to their maturi.ty of the Term Bands and the Serial Bonds. All actions heretofore taken respecting the giving o£ any such call notices are ratified, approved and conf i rmed. SECTI4N XI . Authorization for Transfer o£ Mone� on Deposit in the Bond Fund. The Ci�y Finance Director is authorized to transfer all of the money on deposit in the Bond Fund after the payment af all bonds payable ou� of that fund maturing on September l, 1989 , and interest on all unpaid bonds payable fram that fund, to the Refunding Trustee to carry out the Refunding Plan. SECTI�N XII . Preservatian of Tax Exemption for Interest an Bonds . The City covenants that it will take alI actions necessary to prevent interest an the Bonds from being included in gross income for federal income tax purposes, and it will neither �ake any action nor make or permit any use of proceeds of the Bands or ather funds of the City treated as proceeds of the Bc�nds at any time during �he term of the Bonds which will cause interest on the Bonds to be included in grass income for federal income tax purposes , The City also cavenants that, if - 14 - ORDINANCE NO. 4231 all grass praceeds of the Bands not used in carrying out the Refunding Plan have nat been spent within six months after the date a£ issuance of the Bands, it wa,ll 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 af the amount that would have been earned had the yield on those investrnents been equal to the yie2d on the Bands , plus all zncame 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 Cade, the Ci,ty covenants that, to the extent permitted by that Section, it wiJ.l pay the penalty pravided in Subsection 148(f) (7) (C) if required ta prevent interes� on the Bonds £rom being included in grass income far federal income tax purposes . The City certifies �hat it has nat been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whase arbitrage certifications may nat be relied upon, SECTI4N XIII . Bonds Negotiable. The Bonds shall be negotiable instruments to the extent pravided by RCW 62A. 8-102 and 62A. 8-105 . SECTION XZV. Advance Refundinq or Defeasance af Bonds . Prior to September 1 , 1994, the Bc�nds s�ay be redeemed only from special assessment payments . In the event �hat on or after September 1, 1994 , money and/or "government okaligations. " as _ �� _ ORDINANCE NC1. 4231 de£ined in Chapter 39. 53 RCW as now or hereafter amended, mat�uring at such time or times and bearing interest to be earned thereon in amounts (together with such money, if necessary} sufficient to pay and retire the Bonds in accordance with their �erms, are set aside in or £or �he account of the Bond Fund for the bonds to e£fect such paymen� and retirement, and such rnoney and �he principal of and interest on such gcavernment obligations are set aside in a special fund and pledged irrevocably £ar such purpase, then no further payments need to be made into the Bond Fund for the payment a£ the principal of and interest an the Bonds, and the Bands sha11 cease �o be entitled to any lien, claim, benefit or security of this ordinance or flf the Local Improvement Guaranty Fund except �he right to receive the money so set aside and pledged, and thereafter the Bonds shall be deemed nert to be outstanding hereunder . SECTION XV. Appraval of Bond Purchase Contract. Seattle-Northwest Securities Corparation of Seattle, Washington, has presented a bond purchase cantract (the "Bond Purchase Contract" ) to the City affering ta purchase the Bonds at a price of par plus a premium of $99,604 . 75 and under the terms and conditions provided in the Bond Purchase Contract, which written Bond Purchase Contract is on file with �he City Clerk and is incarporated herein by this reference � The City Council finds that entering into the Bond Purchase Contract is in the City' s best interest and therefore accepts the o£fer contained therein and autharizes its execution by City afficials. - 16 - 4RDINANCE NO. 4231 The Bonds will be printed at City expense and will be delivered ta the purchaser in accordance with �he Bond Purchase Contract, with �he approving legal opinian o£ Foster Pepper & Shefelman, municipal bond counse2 of Seattle, Washington, regarding the Bonds printed on each Bond. Bond counsel shall no� be required to review and shall express no opinion concerning the comple�eness or accuracy af any afficial 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 af£icials are autharized and directed to do every�thing necessary for the prompt delivery of the Bonds to the purchaser, including withaut limitation the execution of the Official Statement on behalf af the City, and for the praper application and use c�f the proceeds of the sale thereof . SECTIQN XVI . Interest Rate on Assessments , The in�erest ra�e on �he installments and delinquent payments of the special assessments in Local Impravement District No . 314 is revised and fixed at the rate of 8 . 625% per annum, effective August 13 , 1989, for all installments due thereafter . SECTION XVI . Temparary Bond. Pending the printing, execution and delivery to the Purchaser of definitive Bonds, the City may cause to be executed and delzvered to the Purchaser a single temporary Bond in the total principal amount of the Bonds . The temporary Bond shall bear the same date of issuance, interest rates, principal payment dates and terms and covenants - 17 - QRDINANCE NO. 4231 as the definitive Bonds , shall be issued as a fully registered Bond in the name af the Purchaser , and otherwise shall be in a form acceptable ta the Purchaser . The temporary Band sha11 be exchanged fQr definitive Bonds as soon as they are printed, authen�icated and available for delivery. SECTION XVII . Effective Dat� of Ordinance . This ordinance shall be e:Efective upon its passage, approval and five days after publicatiQn PASSED by the City Council this 21st day of Augus�, 1989 . �: j� ���1/�"7�!�/�li��✓l-t�v Marilyn �j. �'ters�n, De�suty City Clerk APPROVED BY THE MAYOR this 21st day of August, 1989 . ��-- 4 C�� �.�' �. ,� �.�1 ��,,,� c;\ Ear`� Clymer � M � � Approved as �o Form: �. `� "��� � ���'"�'�'�,_ Date of Pub�cation: August 25, 1989 2552r - 18 -