HomeMy WebLinkAboutResolution 96-202 07/15/1996Resolution No. ss-zoz N.C.S.
of the City of Petaluma, California
RESOLUTION AUTHORIZING ISSUANCE OP BONDS
ASSESSMENT DISTRICT N0.,24
LAKEVILLE HIGHWAY ROAD IMPROVEMENTS
The City Council of the City of Petaluma resolves:
Section 1. RECITALS. On August 21, 1995, the City Council of the City of Petaluma
adopted its resolution of intention to order improvements in Assessment District No. 24,
Lakeville Highway Road Improvements, City of Petaluma, Sonoma County, California,
under the provisions of the Municipal Improvement Act of 1913 (the "Act"), as amended.
Proceedings taken under the Act led to the Icvy of a special assessment by the Council
against parcels of land within the assessment district in the total amount of $4,282,901.26.
These assessments were recorded in the office of the County Recorder of the County of
Sonoma, and thereupon become a lien on each parcel assessed. "I'he period within which
parcel owners might pay their assessments in cash without interest expired on May l5,
1996.
Section 2. ISSUANCE OF BONDS. The Council hereby authorizes the issuance of
improvement bonds under the provisions of the Improvement Bond Act of 191.5 to
represent unpaid assessments in the amount of $2,572,610.74. Each bond shall be
designated, "Limited Obligation Improvement Bond, Ciry of Petaluma, Assessment District
No. 24, Lakeville Highway Road Improvements, Series No. 1996-2." Bonds shall be dated
approximately the date of delivery and issued in denominations of $5000 or integral
multiples thereof, except for Bond. No. 1, which may be an odd amount, 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.
Section APPOiNTMEN"f OF PAYING AGEN'C, REGIS"l'RAR AND 'fRANSPIR
AGENT. The Council hereby appoints the Chemical Trust Company of California (the
"Paying Agent") as paying agent, registrar and transfer agerit for the bonds in accordance
with an agreement 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
be signed by the Finance, 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.
Page 1 of 7 pages
a~~,. m~. _.._._96-.,2.,0, 2... m.cs.
The Paying Agent°shallassign to each bond'authenticated and registered by it a
distinctive letter, or number; or letter and numher,• and shall maintain a record thereof
which shall be available to the City for''inspection.
Section 5: ESTABLISHMENT OF SPECIAL FUND., For administering the proceeds
of the sale of bonds and payment ofinterest 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 investmetit earnings account and the arbitrage rebate account, respectively, for
Assessment District No. 24, Lakeville Highway Road Improvements.
Section 5.1. IMPROVEMF,NT_ACCOUNT. Except as provided in Section 5.3,
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 final engineer's report heretofore approved by the Council,
which report and budget are subject to modificafion 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 trustfor the benefit of the
bondholders. Payment of the bondsof maturity, or at redemption before maturity, and all
interest on the bonds shall be made,from the redemption account. The Ciry shall deposit
into the redemption account, from the proceeds of the.sale of the bonds, the amount of
$127,915.40, which shall be applied to payment of he first payable interest on the bonds
until fully expended.
Section 5.3. PREPAYMENT ACCOUNT. Assessments prepaid in advance of their
maturity shall be deposited in he prepayment account, which shall be utilized as set forth
in Section 8767 bf the Streets and:Highways Gode (Improvement Bond Act of 1915).
Section 5.4. SPECIAL RESEKVF. ACCOUNT. There shall be deposited into the
special reserve account the amount of $ ]28,630.54 from the proceeds of the sale of
bonds. That amount; less any amounts transferred'to the redemption account pursuant to
Section 8884• of the Streets and'Highways Code,. shall. constitute the "Reserve Kequirement"
for the bonds. The special reserve accountshall be maintained by the Finance
Director/Treasurer.
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
Reso. 90-202 NCS Page 2 of 7 pages
the special reserve account from the proceeds,~of'redemption or saleof the parcel for
which payment of delinquent assessmenYinstallments 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 redempdon account, and the: rertiaining,;instaUments of principal and interest not yet
due from assessed property owners shall be cancelled without payment.
Sectlon 5 5. INVESTMENT. EARNINGS ACCOUNT.. Proceeds of the investment of
amounts in the improvement account, the prepayment 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 City Finance Director/Treasurer shall determine
whether any portion of investment earnings musCbe 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:
(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. reseiwe account.
(b) The remaining balance in the investment earnings account, if any, will be
transferred to the improvement account.until the improvement is completed and the
improvement account is closed; thereafter the balance~in the investment earnings account
will be transferred:fo 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 s.:authorized to retain independent attorneys,
accountants and other consultants to assist-in .complying with Federal requirements.
Reso. 96-202 NCS Page 3 of 7 pages
Section 5:6: ARBITRAGE REBATE ACCOUNT. Amounts in the arbitrage. rebate
account hall be invested in the same manner asp 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 Agent shall return to the City 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. ISSUANCE AS BOOK-ENTRY BONDS. The bonds shall. be issued initially
as book-entrybonds and shall be registered to Cede & Co. (the. "Nominee") as nominee of
the Depository Trust Company of New York, Newyork (the 'Depository").
Section 6.1. BOOK-ENTRY BONDS; LIMITED OBLIGATION OF CITY. The bonds
of each maturity shall be authenticated and delivered in the form of a separate single fully
registered bond (which may be^typewritten). The ownership of the bonds shall be
registered in the bond register in the name of the Nominee as nominee of the Depository.
With respect to bonds registered in the name of the Nominee, the Ciry and the
Paying Agent shall have no responsibility or obligation to any participant in the Depository
or to any personon whose behalf a participant Bolds an'interest in the bonds. Without
limiting the generality of the foregoing sentence, the City and the Paying Agent specifically
shall have no responsibility for (i) the accuracy of records. of the Depository, the
Nominee, .of any participant concerning ownership:-interest,in the bonds, (ii) the delivery
to any participant or other person, except as showri in-the bond register, of any notice
eoncerniiig the .bonds, including,any notice of prepayment, (iii) the. selection by the
Depository and its participants of-the beneficial interests in the bonds to be prepaid, if any
bonds are prepaid impart, or (iv) the payment to any participant or other person, other
than a Nominee as shown in the bond register; of any amount with respect to principal of
or interest on the bonds. The' City and the Saying Agent may treat and consider the
person in whose...name each Bond is registered in the bond register as the absolute owner
of that:Bond for the purpose of payment:of principal of or interest on the,Bond, for the
purpose of giving notice. of prepayment aril other``matters concerning the Bond, for the
purpose of`i•egistering transfers bf the `Bond, and for every other purpose.
The ]?aying Agent shall pay all principal of or interest on the bonds only to or upon
the order of the respective owners, as shown,in,the,bond register, or their respective
attorneys duly authorized in writing, and:all such payments shall fully satisfy and
discharge the City?s'obligations for payment of the principal of or interest on the bonds to
the extent-of the payments. No person oilier ithan an-owner, as shown in the bond
register, hall receive a Bond evidencingahe obligailon of the City to make payments of
principal or interest pursuantto this-Resolution. Upon delivery by the Depository to the
Nominee and-the City and the Paying Agenf-of:witten;',noilce to the effect that the
Reso. 96-202 NCS Page 4 of 7 pages
Depository has determined to substitute a new nominee` in place of the Nominee, and
subject to the provisions of Section 7 hereof with respecYto record dates, the word
Nominee in this Resolution shall refer to the new nominee of the Depository.
Section 6.2. REPRESENTATION LETTER. The Finance Director/Treasurer or other
authorized officer of the City is herebyauthocized.to execute, seal, countersign and
deliver on behalf of the City to the; Depository a letter (the "Representation Letter") from
the. City representing such matters as shall be, necessary to qualify the bonds for the book-
entry system. The execution and delivery of~the Representation Letter shall not limit the
provisions of Section 6.1 hereof or in any other way impose on the Ciry or the Paying
Agent any obligation to persons having interests in the bonds other than the owners as
shown on the bond register, The Paying Agent shall take all actions required of the
Paying Agent to comply with the Representation Letter. The. Finance Director/Treasurer
or other Authorized Officerof the City is hereby authorized to take any other actions,
consistent with this Resolution, to qualify the bonds for the Depository's book-entry
program.
Section.6.3. TRANSFERS OUTSIDE BOOK-ENTRY SYSTEM. By written request the
City may remove the Depository and appoint a successor at any time and for any reason.
If (i) the Depository resigns as securifies depository for the bonds, or (ii) the City
removes the Depository, them the-City will discontinue the book-entry system with the
Depository: If-the City fails to idetifify ariotherqualified securities depository to replace
the Depository, the bonds shalt no longer be restricted to registration in the name of the
Nominee, but shall be registered in the .names designated. by owners transferring or
exchanging he bonds. The City at City expense shall furnish a supply of bond forms.
Secfion:7. 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 xhe payment and cancellation of any bond, the bond shall be destroyed and
the Paying,Agent shall furnish the City a certificate of destruction.
Sectibn.8: ,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 6eptembcr in any year by giving at
least 30 days' notice by registered,,or certified mail or 6y 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 a percentage of the principal amount of the redeemed bond, as follows:
peso 96-202 Page 5 of 7 pages
Redemption Date
Redemption Premium
Up to and including March 2, 2005 3%
.September 2, 2005 and March 2, 2006, 2%
September 2, 2006 and March 2, 2007 1%
September 2, 2007 and thereafter 0%
Section REREGISTRATION. Any bond may be registered to a new owner by
completing the assignment certificate orrthe reverse of the bond and delivering the bond
to the Paying Agent. Upon reregistrarion, any band may be'replaced by one or more
bonds of the same maturity and aggregate amount in denominations of $5000 or any
integral multiple thereof.
Section 10: GOVENAN'PS. In the event of a default in the payment of any bond. or
any installment=ofrinterest thereon, bondholders shalt have. the remedies set forth in the
Improvement Bond Act of 1915. In addition, the Council makes the following covenants,
which shall constitute a contracYwith the bondholders:
Section 10:1. FORECLOSURE OF LIENS. Not later than October 1 in any year, the
City shall file att action in the Superior Court to foreclose the lien of each delinquent
assessment if the sum of uncured, assessment delinquencies for the preceding fiscal year
exceeds five percent (5%) of the assessment installments posted to the tax roll for that
fiscal year, ;and if the amount of the special` reserve fund is less than the Reserve
Requirement.
Secfion 10.2. 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 Interna_I' Revenue Code of 1986, and.
regulatiots 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 grid those regulations.
Section 10.3. MAINTENANCE OF TAX EXEMPTION. 1'he City will take all
reasonable actions required to maintain the status of interest on the bonds as excludable
from gross fncome for federal income tax purposes and as exempt from the State of
California personal income taxes.
Reso. 96-202 NCS Page 6 of 7 pages
Section 10.4. CONTINUING DISCLOSURE. At the time of delivery of the bonds the
Ciry 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.
Under the power and authority conferred upon flue Council by the Charter of .said City
REFERENCE: I hemby certify the foregoing Resolution was introduced end adopted by the Approved as to
Council of the City of Petaluma eta (Regular) (A7f}bitifYe~~~(BF~meeting form
on the ......15th........, day of ........._Jul.Y ......................................... 19..96., by the
following wte: _.....-.Ci,.~ ..... ............
Attorney
AYES: Maguire, Hamilton, Stompe, Read, Shea, Vice Mayor Barlas, Mayor Hilligoss
NCES: None ~..//~
ABSENT: None ~{ / ...
ATTEST: ................~~.......................... ~ .......-.........---...-----..._...... (/~/.
City Clerk Mayor
oouoeil File......._._.~.._............_
cn io-es ~ ees:.NO...96.-202.......... N.as. Page 7 of 7 pages
EXHIBIT A
MATURITY SCHEDULE
(TO BE PROVIDED)
g~ES®• 9 6- 2 0 2 N C S
EXHIBIT B
United States of America
State of California
County of Sonoma
REGISTERED REGISTERED
Number ~
LIMITED OBLIGATION IMPROVEMENT BOND
CITY OF PETALUMA
ASSESSMENT DISTRICT NO. 24
LAKEVILLE HIGHWAY ROAD IMPROVEMENTS
SERIES NO. 1996-2
INTEREST RATE MATURI"I'Y DATE BOND DATE CUSIP NUMBER
September 2,
REGISTERED OWNER:
PRINCIPAL SUM:
CEDE & CO.
P. O. Box 20
Bowling Green Station
New York, NY 10005
Tax LD. No. 13-255511.9
Under and by virtue of the Improvement Bond Act of 1915, Division 10 (commencing
with Section 8500), of the Streets and Highways Code (the "Act"), the City of Petaluma,
County of Sonoma, State of California (the "City"), will, out of the redemption account for
the payment of the bonds issued upon the unpaid portion of assessments made for the
acquisition; work and improvements more fully described in proceedings taken pursuant
to Resolution of Intention No. 95-224, adopted by the City Council of the City of Petaluma
on the 21st day of August, 1995, pay to the registered owner stated above or registered
assigns, on the maturity date stated above, the principal sum stated above, in lawful
money of the United States of America and in like manner will pay interest from the
interest payment date next preceding the date on which this Bond is authenticated, unless
this Bond is authenticated and registered as of an interest payment date, in which event it
shall bear interest from such interest payment date, or unless this Bond is authenticated
and registered prior to March 2, 1997, in which event it shall bear interest from its date,
until payment of such principal sum shall have been discharged, at the rate per annum
stated above, payable semiannually on March 2 and September 2 in each year
commencing on March 2, 1997.
&dES®. 9 6- 2 0 2 N C S
For -the period during which The Depository Trust Company, New York, New York
("DTC") or its Nominee or any successor depository or its Nominee is the registered
owner of the Bonds, principal, redemption premiums, if any, and interest shall be paid by
Chemical Trust Company of California (the "Paying Agent") to DTC or such successor
depository by wire transfer; provided that principal and redemption premiums, if any,
shall be paid only upon surrender to the Paying Agent in San Francisco, California or its
successor, of the matured bonds or the bonds called for redemption prior to maturity. As
to any bondholder other than DTC or any successor depository, in the event of
termination of the book-entry system, the principal and redemption premiums, if any, are
payable at the principal corporate trust office of Chemical Trust Company of California, or
its successor, as Paying Agent, in San Francisco, California, and the interest hereon is
payable by check or draft mailed to the registered owner hereof at the owner's address as
it appears on the registration books of the Paying Agent, or at such address as may have
been filed with the Paying Agent for that purpose, as of the fifteenth day of the month
immediately preceding each interest payment date (the "Record Date").
This Bond will continue to bear interest after maturity at the rate above stated, provided, it
is presented at maturity and payment thereof is refused upon the sole ground that there
are not sufficient moneys in said redemption fund with which to pay same. If it is not
presented at maturity, interest thereon will run until maturity.
This Bond shall not be entitled to any benefit under the. Act or the Resolution Authorizing
Issuance of Bonds (the "Resolution of Issuance"), or become valid or obligatory for any
purpose, until the certificate of authentication and registration hereon endorsed shall have
been dated and signed by the Paying Agent.
This Bond is one of several annual series of bonds of like date, tenor and effect, but
differing in amounts, maturities and interest rates, issued by the City under the Act and
the Resolution of Issuance, for the purpose of providing means for paying for the
improvements described in the proceedings, and is secured by the moneys in the
redemption account and by the unpaid portion of assessments made for the payment of
those improvements, and, including principal and interest, is payable exclusively out of
the redemption account.
This Bond is transferable by the registered owner hereof, in person or by the owner's
attorney duly authorized in writing, at the office of the Paying Agent, subject to the terms
and conditions provided in the Resolution of Issuance, including the payment of certain
charges, if any, upon surrender and cancellation of this Bond. Upon transfer, a new
registered bond or bonds, of any authorized denomination or denominations, of the same
maturity, for the same aggregate principal amount, will be issued to the transferee in
exchange therefor.
Bonds shall be registered only in the name of an individual (including joint owners), a
corporation, a partnership or a trust.
2
ItESO. g 6- 2 0 2 N C S
Neither the City nor the Paying Agent shall be required to exchanl;e or to register the
transfer of bonds during the period. commencing with the fifteenth day of the month
immediately preceding any interest payment date (the "Record Date") and ending on said
interest payment date.
The Ciry will not obligate itself to advance available funds from the City treasury to cure
any deficiency which may occur in the bond redemption account. A determination not to
obligate itself shall not prevent the City from, in its sole discretion, so advancing funds.
The City and the Paying Agent may treat the registered owner hereof as the absolute
owner for all purposes, and the Ciry and the Paying Agent shall not be affected by any
notice to the contrary.
This Bond or any portion of it in the amount of Five Thousand Dollars ($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' notice by
registered or certified mail or by personal service to the registered owner hereof at the
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 a percentage of the
principal amount of the redeemed bond, as follows:
Redemption Date
Redemption Premium.
Up to and including March 2, 2005 3%
September 2, 2005 and March 2, 2006 2%
September 2, 2006 and March 2, 2007 1%
September 2, 2007 and thereafter 0%
[Description of term bonds, if necessary]
IN WITNESS WHEREOF, said City of Petalulma has caused this Bond to be signed in
facsimile by the Ciry Treasurer of said City and by its Clerk, and has caused its corporate.
seal to be reproduced in facsimile hereon all as of the day of , 1996.
CITY OF PETALUMA
Clerk Treasurer
(SEAL)
3
RE5®• 9 6- 2 0 2 N C S
CERTIFICATE OF AUTHENTICATION AND REGISTRATION
This is one of the Bonds described in the within mentioned Resolution of Issuance, which
has been authenticated and registered on , 1996
CHEMICAL TRUST COMPANY OF CALIFORNIA
as paying agent, registrar and transfer agent
By
Authorized Signatory
ASSIGNMENT
For value received
the undersigned do(es) hereby sell, assign and transfer unto
the within registered Bond and hereby irrevocably constitute(s) and appoint(s)
to transfer the same on the Bond register of the Bank with
full power of substitution in the premises.
Dated:
Signature:
Note: The signature(s) on this Assignment must correspond with the name(s) as written
on the face of the within registered Bond in every particular without alteration or
enlargement or any change whatsoever.
Signature Guaranteed:
Note: This signature must be guaranteed by an eligible guarantor.
I hereby certify that the following is a correct copy of the signed legal opinion of
STURGIS, NESS, BRUNSELL & ASSAF a professional corporation, Emeryville, California,
on file in my office.
City Clerk
a ~~5~.96-2,Q2NCS