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HomeMy WebLinkAboutOrdinance No. 0441ORDINANCE NO. 441 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF MEDINA, WASHINGTON, PROVIDING FOR THE SALE AND -� ISSUANCE OF TAX ANTICIPATION NOTES OF THE CITY IN THE AGGREGATE PRINCIPAL AMOUNT OF $270,000; PROVIDING FOR THE DISPOSITION OF THE PROCEEDS OF SALE OF SUCH NOTES; FIXING THE DATE, FORM, INTEREST RATE, TERMS, MATURITY AND COVENANTS OF SUCH NOTES; CREATING A TAX ANTICIPATION NOTE FUND FROM WHICH THE PRINCIPAL OF AND INTEREST ON SUCH NOTES SHALL BE PAID; AND CONFIRMING THE SALE OF SUCH NOTES. WHEREAS, from time to time the City of Medina, Washington (the "City") experiences a temporary cash -flow shortfall in its general fund due to the cyclical receipt of tax moneys and the uneven monthly receipt of fee income and to the seasonal nature of the expenditures of funds for the City's facilities and activities; and WHEREAS, the City will incur certain expenses in the operation of its facilities in 1987; and WHEREAS, the City anticipates the receipt of revenues from tax levies in 1987; and WHEREAS, Chapter 39.50 RCW provides that the issuance of short term obligations to provide funding for operation expenses of the City's facilities in anticipation of the receipt of tax revenues may be authorized by ordinance of the City Council; and WHEREAS, the City Council deems it necessary and in the best interest of the City to issue and sell short term obligations as interest bearing tax anticipation notes to provide financing for the operation of its facilities in the year 1987 pending the receipt of anticipated tax revenues; and WHEREAS, the City has received the offer of Peoples National Bank of Washington, Seattle, Washington, dated as of the date hereof, to purchase the short term obligations of the City in the form of such tax anticipation notes in an aggregate principal amount of $270,000 (the "Note"), which offer the City Council has reviewed and finds acceptable; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE -� CITY OF MEDINA, WASHINGTON, AS FOLLOWS: Section 1. Definitions. As used in this ordinance, the following words shall have the following meanings, unless a different meaning clearly appears from the context: (a) "Council" means the Council of the City as the same shall be duly and regularly constituted from time to time. (b) "City" means the City of Medina, Washington, a municipal corporation duly organized and existing under and by virtue of the Constitution and laws of the State of Washington. (c) "Note Fund" means the "City of Medina 1987 Tax Anticipation Note Redemption Fund," created by Section 3 of this ordinance: (d) "Notes" means the interest bearing tax anticipation notes in the aggregate principal amount of $270,000 to be issued pursuant to this ordinance to provide short term financing for the costs of operating the City's facilities in 1987. (a) "Code" means the federal Internal Revenue Code of 1986, as the same may be amended together with corresponding and applicable regulations promulgated or proposed and revenue rulings issued with respect thereto by the Department of Treasury and Internal Revenue Service of the United States. Section 2. Issuance of Notes. In anticipation of the receipt of general tax revenues or revenues from other sources, the City shall, for the purpose of funding the operating and maintenance expenses of its facilities in 1987, issue short term obligations in the aggregate principal amount of $270,000. Said short term obligations shall be designated the "City of Medina, Tax Anticipation Notes, 1987," shall be dated January 21, 1987, -2- JG340 87/01/08 shall be issued in bearer form in the denomination of $5,000 each or integral multiples thereof, shall be numbered separately from 1 upward, shall mature on January 20, 1988, and shall bear interest i payable on maturity at a rate of 4.80% per annum. Interest on the Notes shall be calculated on the basis of a 360-day year consist- ing of 12 months of 30 days each. Both principal of and interest on the Notes shall be payable in lawful money of the United States of America at either of the fiscal agencies of the State of Washington in the cities of Seattle, Washington or New York, New York and shall be general obligations of the City to the extent provided herein. Section 3. Note Redemption Fund., A special fund of the City to be known as the "City of Medina 1987 Tax Anticipation Note Redemption Fund" (the "Note Fund") is hereby authorized to be created by the City Treasurer. Said Note Fund shall be drawn upon for the sole purpose of paying the principal of and interest on the Notes. Moneys on deposit in the Note Fund not immediately needed to pay such interest or principal may temporarily be deposited in such institutions or invested in such obligations which are legal investments for City funds. Any interest or profit from the investment of such moneys shall be deposited in the Note Fund. Any moneys remaining in the Note Fund after payment in full of the principal of and interest on the Notes may 'be transferred to the general fund of the City, and the Note Fund shall be closed. The full faith, credit, and resources of the City are hereby pledged for the prompt payment of the principal of and interest on the Notes. The City further covenants that, beginning in February, 1987, it will set aside and deposit in the Note Fund all tax moneys received until a sum has been deposited in the Note Fund, together -3- JG340 87/01/08 with funds already on hand in such Note Fund, sufficient to pay y:.. the principal of and interest on the Notes as the same shall become due. The City Council hereby declares that, in pledging the tax and other revenues of the City and in covenanting to set aside for the payment of the Notes all tax moneys to be received beginning in February, 1987, it has taken into consideration and exercised due regard for the costs of maintaining and operating the City's facilities. The City Council specifically finds that the tax and other revenues of the City to be received, all moneys available and on hand, and all proceeds of the Notes will together be sufficient to pay such maintenance and operating expenses of the - City as budgeted and to pay the principal of and interest on the Notes upon their maturity without incurrence by the City of further deficit in its general operating fund, and that the Council has not obligated the City to set aside and pay into the Note Fund a greater amount of the general tax and other revenues of the City than in its judgment will be available over and above the City's operating and maintenance expenses during the period that the Notes are outstanding. Section 4. No Redemption Prior to Maturity. The Notes shall not be redeemable in advance of their scheduled maturity. Section S. Application of the Proceeds of Sale of the Notes. Upon receipt of the proceeds of sale of the Notes, the proceeds shall be deposited by the City Treasurer in the general operating fund of the City to pay general operating expenses of the City. Section 6. Form of the Notes. The Notes shall be in sub- stantially the following form: -4- JG340 87/01/08 UNITED STATES OF AMERICA NO. $ STATE OF WASHINGTON ' CITY OF MEDINA TAX ANTICIPATION NOTE, 1987 The City of Medina, Washington (the "City"), a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of Washington, hereby acknowledges itself to owe and for value received promises to pay to bearer on January 22, 198E, solely from the sources hereinafter mentioned, the principal amount of THOUSAND DOLLARS together with interest hereon from the date hereof at the rate of 4.80% per annum payable on maturity. Interest" on this note shall be calculated on the basis of a 360-day year consisting of 12 months of 30 days each. Both the principal of and interest on this note are payable in lawful money of the United States of America at the option of the holder, at either of the fiscal agencies of the State of Washington in the cities of Seattle, Washington, or New York, New York. This note is not subject to redemption by the City prior to its scheduled maturity. This note is one of an issue of tax anticipation notes of the City of like date and tenor except as to denomination and number in the aggregate principal amount of $270,000 and is issued pursuant to duly passed ordinances of the City, including Ordinance No. 441 passed January 12, 1987 (the "Note Ordinance"), for the purpose of financing certain operating and maintenance costs of the City in anticipation of the receipt of tax revenues for such purposes, all in conformity with the Constitution and laws of. the State of Washington and the ordinancesof the City. The full faith, credit and resources of the City are hereby irrevocably pledged for the prompt payment of such principal and interest. The City has further covenanted that, beginning in February, 1987, it will set aside and deposit in the "City of Medina 1987 Tax Anticipation Note Redemption Fund," created by the Note Ordinance, all tax monies collected until a sum has been deposited in such Note Fund, together with funds already on hand in such Note Fund, sufficient to pay the principal of and interest on the notes of this issue as the same become due. It is hereby certified and declared that this note is issued pursuant to and in strict compliance with the Constitution and laws of the State of Washington and duly passed ordinances of the City and that all acts, conditions and things required to have . -.5- JG340 87/01/08 happened, been done and performed precedent to and in the issuance hereof have happened, been done, and performed. IN WITNESS WHEREOF, the City of Medina, Washington, has caused this note to be signed with the manual or facsimile signature of the Mayor of the City, to be attested by the manual or facsimile signature of the Clerk of the City and the corporate seal of the City to be impressed or imprinted hereon, as of this day of January, 1987. CITY OF MEDINA, WASHINGTON By /a/ manual or facsimile signature Mayor [SEAL] ATTEST: /s/ manual or facsimile signature City Clerk Section 7. Execution of the Notes. The Notes shall be executed on behalf of the City by the manual or facsimile signature of the Mayor shall be attested by the manual or facsimile signature of the Clerk of the Board (at least one of which signatures shall be manual) and shall have the corporate seal of the City impressed or imprinted thereon. Section S. Sale of the Notes. The written offer of Peoples National Bank of Washington dated January 12, 1987, attached hereto and incorporated herein by reference, to purchase the Notes at a price of 100% of the principal amount of the Notes, on the terms set forth therein and herein, is hereby accepted and approved. Section 9. Authorization to Officials and Agents. Upon the sale of the Notes, the appropriate City officials, agents and representatives are hereby authorized and directed to do every- thing necessary for the prompt issuance, execution and delivery of the Notes and for the proper use and application of the proceeds of the sale thereof as provided in this ordinance. -b- JG340 87/01/08 All actions heretofore taken by the City's officials, agents and representatives in connection with the issuance and sale of the Bond and in connection with the City's request for proposals ' to purchase the Note are hereby ratified, approved and confirmed. Section 10. Bond to Remain Tar. Exempt; Nonarbitrage. The City covenants that it will not take or permit to be taken on its behalf any action which would adversely affect the exemption from federal income taxation of the interest on the Notes and will take or require to be taken such acts as may reasonably be within its ability and as may from time to time be required under applicable law to continue the exemption from federal income taxation of the interest on the Notes provided, however, that the City does not represent, warrant, covenant or agree that interest on the Notes will not be taken into account for purposes of computing the corporate or individual alternative minimum tax under Section 55 of the Code, or for purposes of computing the environmental tax on corporations under Section59A of the Code or under any other similar treatment of interest on the Notes. Without limiting the generality of the foregoing, the City covenants that it will not take any action or fail to take any action with respect to the investment of the proceeds of the Notes or other funds which would result in constituting the Notes to be an "arbitrage bond" within the meaning of such term as used in Section 148 of the Code (or any successor provision thereof applicable to the Notes) or which .would violate Treasury Regulations under Sections 148 of the Code applicable to the Notes. The Council hereby finds and declares, with respect to Section 148(f)(4)(C) of the Code, that (i) ninety-five percent or more of the net proceeds of the Notes will be used for local governmental activities of the City and (ii) the aggregate face amount of all tar. -exempt notes, bonds and other obligations issued by the City (and all subordinate entities -7- JG340 87/01/08 thereof) during the calendar year of 1987 is not reasonably expected to exceed $5,000,000. The City further covenants that it will not take any action or permit any action to be taken that would cause the Notes to constitute "private activity bonds" under Section 141 of the Code. Section 11. Notes Are "Qualified Tax -Exempt Obligations." The City hereby designates the Notes as "qualified tax-exempt obligations" under Section 265(b) of the Code. The City does not expect to issue tar. -exempt obligations in an aggregate principal amount in excess of $10,000,000 during calendar year 1987. Section 12. Lost or Destroyed Notes. In case the Notes or any of them shall be lost, stolen, mutilated, or destroyed, the City may execute and the City Treasurer may deliver a new Note or Notes of like amount, date, and tenor to the registered owner thereof upon the owner's paying the expense and charges of the City and said Treasurer in connection therewith and upon his/her filing with the Treasurer evidence satisfactory to said Treasurer that such Note or Notes were actually lost, stolen, mutilated, or destroyed and of. his/her ownership thereof, and upon furnishing the City with indemnity satisfactory to such Treasurer. Section 13. Severability. If any one or more of the cove- nants or agreements provided in this resolution to be performed on the part of the City shall be declared by any court of competent jurisdiction to be contrary to law, then such covenant or covenants, agreement or agreements, shall be null and void and shall be separable from the remaining covenants and agreements in this resolution and shall in no way affect the validity of the other provisions of this resolution or of the Notes. -8- JG340 87/01/08 Section 14. Effective Date. This ordinance shall become effective from and after its passage and publication as required by law. APPROVED AND ADOPTED at a regular meeting of the City Council held this 12th day of January, 1987. ATTEST: �v C ty C erk CITY OF MEDINA By M yor hereby ce,lifY that I am Ih of sir Oi of J'/odina; rh E--.11itl![0; a' )nnexed Iw.clo is ° C. Cfcr1 o....T,17 ....................... . oos�ad i accara evin.i'.d nfJ!! dng la tFx i tt.v of such or2 nary s - .. apes b h v rs of Ih. 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