HomeMy WebLinkAboutResolution 97-290 10/20/1997 Resolution No. 97-z9o NC.S.
of the City of Petaluma, California
RESOLUTION AUTHORIZING ISSUANCE OF BONDS
McNEAR LANDING ASSESSMENT DISTRICT NO. 25
The City Council of the City of Petaluma resolves:
Section 1. RECITALS. On June 16, 1997, the City Council of the City of Petaluma
adopted its resolution of intention, as later amended, to order improvements in McNear
Landing Assessment District No. 25, City of Petaluma, County of Sonoma, California,
under the provisions of the Municipal Improvement Act of 1913 (the "Act"), as amended.
Proceedings taken under the Act led to the levy of a special assessment by the Council
against parcels of land within the assessment district in the total amount of X1,800,000.00.
'These assessments will be recorded in the office of the County Recorder of the County of
Sonoma, and thereupon will become a lien on each parcel assessed. The period within
which parcel owners might pay their assessments in cash without interest has been
waived.
Section 2. ISSUANCE OF BONDS. The Council hereby authorizes the issuance of
improvement bonds under the provisions of the improvement Bond Act of 7.915 to
represent unpaid assessments in the amount of $1,800,000.00. Each bond shall be
designated, "Limited Obligation Improvement Bond, City of Petaluma, McNear Landing
Assessment District No. 25, Series No. 1997-1." Bonds shall be dated approximately the
date of delivery and issued in denominations of $5000 or integral multiples thereof, and
may be issued as serial bonds, term bonds, or any combination thereof. Bonds shall
mature in principal amounts as set forth in the table attached as Exhibit A. The bond date
and interest rates on the bonds shall be as set forth in the bond purchase agreement.
Assessment installments sufficient to make mandatory advance redemptions on the
term bonds, if any, shall be collected by the City, deposited in the Redemption Account
and used: by Chase Trust Company of California for the mandatory advance redemption
or payment of the term bonds. All other advance redemptions. of term bonds or serial
bonds shall be as provided in the Improvement Bond Act of 1915.
Section APPOINTMENT OF PAYING AGENT. REGISTRAR, TRANSFER AGENT
AND DISSEMINATION AGENT. The Council hereby appoints the Chase Trust Company
of California (the "Paying Agent") as paying agent, registrar, transfer agent and
dissemination agent for the bonds in accordance with agreements between the City of
Petaluma and the Paying Agent.
Section 4. FORM AND EXECUTION. Bonds shall be issued as fully registered
bonds substantially in the form set forth as Exhibit B to this resolution. The bonds shall
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be. signed by the Pinanee Director/Treasurer and the City-Clerk and the seal of the City
shall`be affixed: Both signatures and seal may be reproduced on the bonds by facsimile,
but upon its registration or reregistration each bond shall be authenticated by the manual
signature of the Paying Agent.
The Paying Agent shall assign to each bond authenticated and registered by it a
distinctive letter, or number, or letter and number, and shall maintain a record thereof
which shall be available to the City for inspection.
Section ESTABLISHMENT OF SPECIAL FUND. For administering the proceeds
of the sale of bonds and payment of interest and principal on the bonds, there is hereby
established a special fund consisting of six accounts to be known as the improvement
account, the redemption account, the prepayment account, the special reserve account,
the investment earnings account and the arbitrage rebate. account, respectively, for McNear
Landing Assessment District No. 25.
Section 5.1. IMPROVEMENT ACCOUNT. Except as provided in Sections 5.2 and
5:4, proceeds of sale of the bonds, together with all amounts paid on the assessments
before bond issuance, shall be deposited in the improvement account to be maintained by
the Finance Director/Treasurer. Disbursements from the improvement account shall be
made by the Finance Director/Treasurer in accordance with the budget of estimated costs
and expenses set forth in the engineer's report heretofore approved by the Council, which
report and budget are subject to modification by the Council from time to time as
prescribed by the Act.
Section 5.2. REDEMPTION ACCOUNT. The redemption account shall be
maintained by the Finance Director/Treasurer. All payments of principal and interest.
installments on the assessments, together with penalties, if any, shall be deposited in the
redemption account, which shall be considered as a trust for the benefit of the
bondholders. Payment of the bonds at maturity, or at redemptlon before maturity; and all
interest on the bonds shall be made from the redemption account. The redemption
account shall be depleted, by the second day of September in each year, to not more than
the greater of (a) one year's earnings on the account or (li) one-twelfrh of the scheduled
debt service for the current year.
The Ciry shall deposit into the redemption account, from the proceeds of the sale
of the bonds, the. amount of $135,000.00, which shall be applied to payment of the first
payable interest on the bonds until fully expended.
Sectioh 5.3. PREPAYMENT ACCOUNT. Assessments prepaid in advance of their
maturity shall. be deposited in the prepayment account, which shall be utilized as set forth
in Section 8767 of the Streets and Highways Code (Improvement Bond Act of 1915).
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Section 5:4. .SPECIAL RESERVE ACCOUNT. The special reserve account shall be
maintained by the Finance Director/Treasurer. The Finance Director/Treasurer shall
deposit into the special reserve account from the .proceeds of the sale of the bonds an
amount not exceeding the least of the following amounts: a) ten percent of the proceeds
of the bonds; b) maximum annual debt service on the bonds; or c) 125% of the average
annual debt service on the borids. That. amount, less any amounts transferred to the
redemption account pursuant to Section 8884 oPthe Streets and Highways Code, shall
constitute the "Reserve Requirement." The special reserve account shall be administered
as follows:
A. During the term of the bonds, the amount in the special reserve account
shall be available for transfer into the redemption account in accordance with Section
8883 of the Streets and Highways Code. The amount so advanced shall be reimbursed to
the special reserve account from the proceeds of redemption or sale of the parcel for
which payment of delinquent assessment installments was made from the special reserve
account.
B. If any assessment is prepaid before final maturity of the bonds, the amount
of principal which the assessee is required to prepay shall be reduced by an amount
which is in the same ratio to the original .amount of the special reserve account as the
original amount of the. prepaid assessment bears to the total amount of unpaid
assessments originally securing the Bonds. This reduction in the amount of principal
prepaid shall be balanced by a transfer from the special reserve account to the
redemption account in the same amount.
C. The amount maintained in the special reserve account will never exceed the
Reserve Requirement. Proceeds of investment of the special reserve account shall be
deposited in the investment earnings account.
D. When the amount in the special reserve account equals or exceeds the
amount required to retire the remaining unmatured bonds (whether by advance
retirement or otherwise), the amount of the special. reserve account shall be transferred to
the redemption account, and the remaining installments of principal and interest not yet
due from. assessed property owners shall be cancelled without payment.
Section 5.5: INVESTMENT EARNINGS ACCOUNT. Proceeds of the investment of
amounts in the improvement account and the special reserve account will be deposited in
the investment earnings account. As of September 2 of each year during the term of the
bonds, the Finance. Director/Treasurer shall determine whether any portion of investment
earnings must 6e rebated to the United States pursuant to Section 148 of the United States
Internal Revenue Code and regulations adopted thereunder. Any amounts required to be
rebated will be transferred to the arbitrage rebate account, and the balance will be
transferred as follows:
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' A.. To>the extent that the balance in the special reserve account is less than the
Reserve Requirement, a transfer will be made from the investment earnings account to the
special reserve account.
B. The remaining balance in the investment earnings account, if any, will be.
transferred to the redemption account to be used, in the discretion of the. Finance
Director/Treasurer, as a credit upon the annual installments of assessment or for the
advance retirement of bonds.
The Finance. Director/Treasurer is authorized to retain independent attorneys,
accountants and other consultants to assist in complying with Federal requirements.
Section 5.6. ARBITRAGE REBATE ACCOUNT. Amounts in the arbitrage rebate
account shall be invested in the same manner as amounts in the other accounts and shall
be held in trust for rebate to the United States at the times required by Section 148 of the
United States Internal Revenue Code and regulations adopted thereunder.
Section 5.7. RETURN OF UNCLAIMED FUNDS. Other provisions of this resolution
to the contrary notwithstanding, the Paying Agenrshall return to the Ciry any funds held
by it hereunder not later than twelve (12) months before those funds would escheat to the
State of California under any law now or hereafter enacted.
Section 6. PAYMENT ON BONDS. The principal and interest on the bonds shall
be payable at the office of the Paying Agent, San Francisco, California. Principal and
interest shall be paid by check, draft or warrant mailed to the registered owner of each
bond at the owner's address appearing on the register maintained by the Paying Agent on
the fifteenth day of the month immediately preceding any payment date (the "Record
Date").
Upon the payment and cancellation of any bond, the bond shall be destroyed and
the Paying Agent shall furnish the City a certificate of destruction.
Section ADVANCE RETIREMENT OF BONDS. Any Bond or any portion thereof
in ,the amount of $5,000 or any integral multiple thereof, may be redeemed and paid in
advance of maturity upon the second day of March or September in any year by giving at
least 30 days' potice by registered or certified mail or by personal service to the registered
owner thereof at such owner's address as it appears on the registration books of the
Paying Agent and by paying principal and accrued interest together with a premium equal
to three percentum of the principal.
Section 8. REREGISTRATION. Any bond may be registered to a new owner by
completing. the assignment certificate on the reverse of the bond and delivering the bond
to the Paying Agent. Upon reregistration, any bond may be replaced by one or more
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bonds of the same maturity and aggregate amount in denominations of $5000 or any
integral multiple thereof.
Section COVENANTS. In the event of a default in the payment of any bond or
any installment of interest thereon, bondholders shall .have the remedies set forth in the
Improvement Bond Act of 1915. In addition, the Council makes the following covenants,
which shall constitute a contract with the bondholders:
Section 9.1. FORECLOSURE OF LIENS. Not later than October 1 in any year, the
Ciry shall file an action in the Superior Court to foreclose the lien of each delinquent
assessment if a property owner owning more than four parcels, or responsible for
payment of assessment liens exceeding $30,000, is delinquent, and if the amount of the
special reserve fund is less than 85% of the Reserve Requirement.
Section 9.2. ARBITRAGE. During the term of the bonds, the City will make no use
of bond proceeds which, if such use had been reasonably expected at the date the bonds
are issued, could have caused the bonds to be "arbitrage bonds" within the meaning of
Section 148 of the United States Internal Revenue Code of 1)8C, and regulations of the
Internal Revenue Service adopted thereunder, and further shall rebate to the United States
any amounts required to be rebated on account of arbitrage in accordance with the
provisions of that Code and those regulations.
Section 9.3. MAINTENANCE OF TAX EXEMPTION. The City will take all
reasonable actions required to maintain the status of interest on the bonds as excludable
from gross income for federal income tax purposes and as exempt from the State of
California personal income taxes.
Section 9.4. CONTINUING DISCLOSURE. At the time of delivery of the bonds the
City will furnish a certificate of continuing disclosure to permit the purchaser of the
bonds to conform with Rule 15c2-12 of the United States Securities and Exchange
Commission.
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Under the power and authority conferred upon this Council by the Charter of said City.
REFERENCE: I. hereby certify the foregoing Resolution was introduced and adopted by the Approved as to
Council of the City of Petaluma at a (Regular) (Adj~C7C,7~$~8.~1~tffi*~peting form
on the ...........20th..... day of ....._............(1Gtober...--• 19.......9bY the
following vote:
City Attorney
AYES: Read, Keller, Stomps, Maguire, Vice Mayor Hamilton, Mayor Hilligoss
NOES: Torliatt
ABSENT: None
s
ATTEST:
City Clerk Mayor
Gbwal Filn.._.....__
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