HomeMy WebLinkAboutCity Council Meeting - Council - Agenda - 02/04/2014 CITY OF KENT
Agenda
City Council Meeting
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February 4, 2014
Mayor Suzette Cooke
Darla Ralph, Council President
Councilmembers
Jim Berrios
Bill Boyce
Dennis Higgins
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Deborah Ranniger
Les Thomas
CIFY CLERK
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KENT CITY COUNCIL AGENDAS
KENT February 4, 2014
w s v ro Council Chambers
Mayor Suzette Cooke
Council President Dana Ralph
Councilmember Jim Berrios Councilmember Bill Boyce
Councilmember Dennis Higgins Councilmember Deborah Ranniger
Councilmember Les Thomas
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SPECIAL COUNCIL WORKSHOP AGENDA
5:00 P.M.
Subiect Speaker Time
2014 Top Departmental Issues Tom Brubaker 90 min
COUNCIL MEETING AGENDA
7:00 p.m.
1. CALL TO ORDER/FLAG SALUTE
2. ROLL CALL
3. CHANGES TO AGENDA
A. FROM COUNCIL, ADMINISTRATION, OR STAFF
B. FROM THE PUBLIC — Citizens may request that an item be added
to the agenda at this time. Please stand or raise your hand to
be recognized by the Mayor.
4. PUBLIC COMMUNICATIONS
A. Public Recognition
B. Community Events
C. Introduction of new Arts Commission Appointee, Lynn Bohart
D. Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E. Intergovernmental Reports
5. PUBLIC HEARINGS
6. PUBLIC COMMENT
7. CONSENT CALENDAR
A. Minutes of Previous Meetings and Workshop — Approve
B. Payment of Bills — Approve
C. Appointment to Arts Commission — Confirm
D. Appointments to Land Use and Planning Board - Confirm
(Continued)
COUNCIL MEETING AGENDA CONTINUED
E. Refunding 2004 Limited Tax General Obligation Bond Ordinance —
Adopt
F. Budget Certification for Annexation Sales Tax Credit Resolution —
Adopt
G. Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. — Authorize
H. 2013 Crack Sealing Project Completion — Accept
I. Oakleigh I & II Bill of Sale- Accept
8. OTHER BUSINESS
A. Financial policy Resolution - Adopt
9. BIDS
10. REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
11. EXECUTIVE SESSION AND ACTION AFTER EXECUTIVE SESSION
12. ADJOURNMENT
NOTE: A copy of the full agenda packet is available for perusal in the City Clerk's
Office. The Agenda Summary page and complete packet are on the City of
Kent web site at www.KentWa.gov
An explanation of the agenda format is given on the back of this page.
Any person requiring a disability accommodation should contact the City Clerk's Office
in advance at (253) 856-5725. For TDD relay service call the Washington
Telecommunications Relay Service at 1-800-833-6388.
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CHANGES TO THE AGENDA
Citizens wishing to address the Council will, at this time, make known the
subject of interest, so all may be properly heard.
A) From Council, Administration, or Staff
B) From the Public
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PUBLIC COMMUNICATIONS
A) Public Recognition
B) Community Events
C) Introduction of new Arts Commission Appointee, Lynn Bohart
D) Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E) Intergovernmental Reports
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PUBLIC HEARING
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PUBLIC COMMENT
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Agenda Item: Consent Calendar 7A - 7B
CONSENT CALENDAR
7. City Council Action:
Councilmember moves, Councilmember
seconds to approve Consent Calendar Items A through E.
Discussion
Action
7A. Approval of Minutes.
Approval of the minutes of the workshop and regular Council meeting of
December 10, 2013.
7B. Approval of Bills.
Approval of payment of the bills received through November 30 and paid on
November 30 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
11/30/13 Wire Transfers 5684-5694 $1,148,142.13
11/30/13 Regular Checks 678482-678852 $3,165,660.16
Void Checks ($104.90)
11/30/13 Use Tax Payable $1 290.72
$4,314,988.11
Approval of payment of the bills received through December 15 and paid on
December 15 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/15/13 Wire Transfers 5695-5714 $2,044,626.90
12/15/13 Regular Checks 678853-679223 $2,045,487.95
Void Checks ($0.00)
12/15/13 Use Tax Payable $1 414.29
$4,091,529.14
Approval of payment of the bills received through December 31 and paid on
December 31 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/31/13 Wire Transfers 5715-5727 $1,375,632.00
12/31/13 Regular Checks 679224-679539 $3,099,891.45
Void Checks ($675.00)
12/31/13 Use Tax Payable $162.74
$4,475,011.19
Approval of checks issued for payroll for November 16 through November 30 and
paid on December 5, 2013:
Date Check Numbers Amount
12/5/2013 Checks 333708-333824 $ 91,543.70
Voids and Reissues
12/5/2013 Advices 322206-322830 1,569,071.57
$1,660,615.27
Approval of checks issued for payroll for December 1 through December 15 and
paid on December 20, 2013:
Date Check Numbers Amount
12/20/2013 Checks 333825-333949 $ 77,667.53
Voids and Reissues
12/20/2013 Advices 322831-323460 1,299,170.40
$1,376,837.93
Approval of checks issued for payroll for December 16 through December 31 and
paid on January 3, 2014:
Date Check Numbers Amount
1/3/2014 Checks 333950-334083 $ 66,870.91
Voids and Reissues
1/3/2014 Advices 323461-324081 1,251,884.88
$1,318,755.79
11 � KENT
Kent City Council Workshop
January 21, 2014
The meeting was called to order at 5:30 p.m. by Council President Ralph.
Councilmembers present: Ralph, Berrios, Higgins, Ranniger, and Thomas
Council President Ralph discussed the application process for the Council vacancy. She
highlighted how to apply and verified that the Council would review applications at a
special meeting on February 11, 2014 at 6:00 p.m.
Council Retreat Dates — Council President Ralph communicated that the Council
Retreat would be March 21 and 22 at the Green River Community College.
Councilmember Ranniger suggested an email be sent to Councilmembers.
IS 402 Training - Dominic Marzano, Emergency Management Director discussed IS-
402. He communicated that it is a class for executives and senior officials (policy
makers) and trains them how to better manage events and make policy decisions. He
noted that best practices will also be communicated in the class. He noted that the
class is for South King County officials and urged Council participation in the class. He
also communicated that he will be speaking to MLT next Monday concerning a class
for them because of some new equipment in the emergency communication center
(ECC).
Councilmember Higgins verified that the training is February 12 from 6:00 p.m. to
8:00 p.m.
Marzano also suggested that the Mayor bring the Acting City Attorney to the class to
go over policy decisions.
Council President Ralph communicated that she felt this would be a good opportunity
for the Council. She said there is a lot involved and this is a detailed process. She
noted that at the South County Area Transportation Board meeting there was a
discussion about what cities have set up in case of an oil spill because of the increase
of oil tanker ships in the Puget Sound. Marzano confirmed that the City does have a
plan set up.
B&O Tax Amendments — Robert Nachlinger, Finance Director discussed the
preliminary amendments to the B&O tax ordinance. He communicated that it was
adopted a little over a year ago and the City has received about three quarters of the
projected revenues. He noted that there is an inconsistency between local codes and
that has caused confusion to firms who have to file B&O in numerous cities. He
reviewed Bellevue, Seattle, and Tacoma's exemptions and said staff proposes to
exempt all 501(c) organizations to include homeowner associations, unions, fraternal
organizations, and others who are not engaging in retail activities.
Councilmember Higgins verified that there are a couple of organizations that are
501(c) status that engage in retail sales such as Goodwill and Children's Hospital.
Kent City Council Workshop Minutes January 21, 2014
Councilmember Ranniger inquired about the financial impact and Nachlinger replied
that it would be about $25,000 per year.
Nachlinger continued and discussed filing status and frequency. He noted that having
all firms file quarterly this first year has provided the City with data. Almost 1,600
firms have paid and 36 percent of them (576) have paid over $1,000 quarterly and
this, he noted makes up 92 percent of the total tax revenues collected. He continued
and said 64 percent have paid less than $1,000 and less than 8 percent of the total
revenues collected. He suggested that the firms who have paid less than $1,000 be
reverted to annual collections based on these numbers.
Discussion continued on how they would be reverted to annual collections and
Nachlinger communicated that the Finance Department could send them a letter
communicating this. He also stated that the staff did not recommend having a "non-
filing status" so the City could continue to maintain information concerning
businesses.
Councilmember Higgins verified that only Bellevue and Tacoma have a non-filing
option and Nachlinger communicated their amounts.
Councilmember Higgins discussed the administrative expenditures concerning the
B&O tax.
Councilmember Berrios verified the department was down an auditor. He also
confirmed with Nachlinger that they haven't gotten the data concerning most of the
seasonal firms. However, the data should come in February or March.
Council President Ralph verified with Brubaker that an ordinance would be drafted and
brought to Council for adoption.
Council President Ralph stated she is comfortable with this and agreed with the
process of letting businesses know they have been moved to an annual filing status.
Councilmember Thomas suggested the ordinance be retroactive and if they have paid
this past year they have their funds refunded and not penalized. Fitzpatrick
communicated that his staff will look into doing that.
Councilmember Berrios communicated that the process needs to be fair and
accountable. He said the policy needs to be consistent and take into account who paid
and who didn't based on the legislation the Council passed.
Council President Ralph stated that it seems best to stay the course and make
revisions at the end of the year.
Nachlinger stated that there are 145 3PLs and based on the amount of revenues
generated from their B&O tax compared to their square footage tax returns, the
square footage tax amount was 3.5 times their B&O tax amount. He stated that the
B&O is working exactly as it was intended to. He communicated that there is an
argument concerning companies that don't do many deliveries into Kent, but they are
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Kent City Council Workshop Minutes January 21, 2014
making more money than what is being reported. He stated that the tax is designed
to get some mitigation from companies that destroy the cities roads.
Councilmember Higgins inquired about the federal research and development funds
and Nachlinger communicated that since the City gave an exemption he wasn't sure
how much it was for.
Councilmember Berrios stated that the Chamber discussed that with Boeing and they
didn't know what the number was either.
Council President Ralph verified that they weren't required to report those federal
funds to the City.
Mayor Cooke clarified that the 3PLs aren't seeking an exemption, but a reduced rate
due to the square footage tax compared to their gross revenues that would be with
the B&O tax. She communicated that if the Council decides that they don't want 3PLs
the businesses can easily go to local cities. She recommended the Council look at the
entire picture and realize that the surface isn't equal.
Councilmember Higgins stated these businesses are creating truck traffic so the B&O
tax makes sense. He also added that the other tax seems appropriate, too.
Councilmember Thomas communicated that he would like to remain competetive and
verified with the Mayor that there are ten 3PL companies. Additionally, the Mayor
added that she wasn't sure how much of the product they are storing is from local
businesses.
Councilmember Ranniger stated that there have been challenges with the streamline
sales tax for a while now. She stated the other policy question is whether to rezone
the area to retail. She said that if the City discourages these types of businesses
because of the B&O tax, the City needs to prepare to decide what it wants to see in
those properties.
Council President Ralph questioned if the conversation should be left open or have
these amendments brought forward.
Councilmember Ranniger stated she would like to see the 501(c) exemption be
brought forward and continued discussion on the 3PLs.
Councilmember Berrios confirmed that there were ten CPLs and added that the City
needs to attract and keep current businesses here. He stated he wasn't sure of the
details with the 3PLs. However, he questioned if the City should allow current
businesses to grow in their current space and investigate exemptions to these
businesses. He suggested investigating if the City is collecting the proper amounts
from these businesses.
Nachlinger verified that they are looking for reductions in their rates, not exemptions.
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Kent City Council Workshop Minutes January 21, 2014
Mayor Cooke verified with Council President Ralph that this item should go to the
Economic and Community Development Committee.
Council President Ralph communicated that there is consensus to move the 501(c)
revisions to the Operations Committee.
Councilmember Higgins discussed the Sound Transit proposal for gas taxes which
would end up being $3.1 million to the City of Kent for transportation.
Councilmember Thomas communicated that he is against the item.
Council President Ralph communicated that the King County Council is discussing two
different packages and need to decide before March 7 whether or not to go to a ballot
measure. She added that they are also discussing bus fare increases.
Councilmember Higgins communicated that he felt the item is likely to pass county
wide and $3.1 million would be good for closing the gap in transportation
maintenance.
Council President Ralph communicated that Thomas is against, Higgins is in favor,
Ranniger is neutral, and Berrios wants more information. She concluded that she will
communicate to the South County Area Transportation Board that the Kent City
Council is neutral on this item.
Councilmember Thomas communicated that a sixty dollar increase in tabs invites
Eyman to create something worse.
Councilmember Higgins agreed, but noted that Eyman wants these to come to a vote
of the people.
Council President Ralph communicated that it technically isn't sixty dollars, the
current twenty dollar vehicle registration tax would drop off and be sixty dollars, thus
forty dollars more. She also informed the Council to discuss this item with
Councilmember Boyce.
Brubaker noted that this is Nachlinger's last Council workshop and is leaving the City
in very good shape and thanked him for his service to the City of Kent.
Nachlinger stated that he is looking forward to his retirement.
The meeting adjourned at 6:15 p.m.
Ronald F. Moore, MMC
City Clerk
4
KENT
Kent City Council Meeting
January 21, 2014
The regular meeting of the Kent City Council was called to order at 7:01 p.m. by
Mayor Cooke.
Councilmembers present: Higgins, Berrios, Boyce, Ralph, Ranniger, and Thomas.
CHANGES TO THE AGENDA
A. From Council, Administration, Staff - Brubaker communicated that the item in
front of the Councilmembers' dias was the attachment to the Transportation
Improvement Board grant.
B. From the Public - None.
PUBLIC COMMUNICATIONS
A. Oath of office, Councilmember Jim Berrios - City Clerk Ronald F. Moore swore
in Jim Berrios as Councilmember Position No. 2.
B. Public Recognition
1. Kent Parks Foundation Donation - Jeff Watling, Parks and Recreation
Director introduced Mark Prothero, President of the Kent Parks Foundation who
presented the city of Kent with a check for $9,532.57. Prothero also discussed the
"Kent Dancing with the Stars" and communicated that the event raised $13,846.15.
Mayor Cooke thanked Prothero and verified that people who wanted to get in donating
or raising funds for Kent's recreation program could speak to Sandy Pedersen.
2. Award for Men's "E" Western National ASA Softball Tournament to the
City of Kent - Jeff Watling, Parks and Recration Director introduced Mike Raven from
the Amateur Sports Association (ASA). Raven thanked the Kent City staff and
presented the James Ferrell Award to Mayor Cooke and the city of Kent.
Mayor Cooke thanked Raven and the city of Kent Parks staff.
C. Community Events - Mayor Cooke announced that the "You-Me-We" event is this
Friday at the ShoWare Center, January 24 at 6:00 p.m. She encouraged the public to
attend the free event.
Mayor Cooke also noted that her "State of the City Address" wil be at the ShoWare
Center during the Chamber of Commerce Luncheon on February 5 at 12 noon. She
also added that it will be online and on the City's cable station.
D. Introduction of new Arts Commission Appointee, Jennifer Treese - Mayor
Cooke communicated that she interviewed her for the position.
Kent City Council Meeting Minutes January 21, 2014
Treese communicated that she found the vacancy online and said she has been doing
cultural things for over a decade now. She added that her employer is Blue Origin, a
rocket company in Kent.
E. Public Safety Report - Police Chief Ken Thomas discussed Mike Buckingham and
his memorial service last Thursday. He discussed Buckingham's service to the City and
people. He noted that he lost his battle with cancer on January 2, 2014.
Council President Ralph discussed Buckingham and her son's experience with him. She
stated that she was fortunate enough to meet him and work with him the last couple
of years. She said he has had a tremendous impact on the City and will truly be
missed.
Thomas discussed the year end report. He noted that commercial burglary is
unchanged and there has been a 21 percent reduction in residential burglaries from
2012 to present. He noted that robbery is down 13 percent. He noted that vehicle theft
is only up 2 percent compared to the rampant vehicle theft rate in King County.
Thomas presented Christin Jordan with the Police Chiefs Award of Accomodation. He
communicated that Jordan was instrumental in a stolen car recovery and preventing a
residential burglary.
Thomas presented Shanelle Mozique with the Police Chief's Award of Accomodation. He
explained that Mozique, while in the middle of a home invasion, called the police
department during the robbery. He noted that the police successfully caught two of the
three suspects.
Thomas presented Officer Whisteric and Officer Nixon with the Police Department
Lifesaving Medal for saving the life of Lewis Drake. Drake submitted a letter to the
Police Chief, which he read.
Thomas communicated that the City is in the top ten of all cities with a population of
250,000 or less for their efforts with National Night Out, which is run by Sarah Wood.
Sarah Wood communicated that the event will be on August 10, 2014 this year.
Thomas introduced four new officers, Siitupe Coffin, Kamal Sharif, Andrew Richardson,
and Brittany Rios. He discussed each of their backgrounds, work experience, and
education.
Mayor Cooke swore in the four officers.
Thomas introduced newly hired Corrections Officer Ian Lentz and Records Specialists
Julie Farris, Ashley Orlowski, Christy Roeber, and Crystal Sundquist. He highlighted
their work history and gave a brief backgound of their education and personal lives.
Thomas presented a Chief's Award of Accomodation to Councilmember Berrios for
performing CPR on a patient who suffered a medical emergency.
Mayor Cooke presented Chief Ken Thomas with his city of Kent 25 year service plaque.
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Kent City Council Meeting Minutes January 21, 2014
F. Intergovernmental Reports - Council President Ralph communicated that the
South County Area Transportation Board met concerning express toll lanes being
added on Interstate 405 between Lynnwood and Bellevue and the addition of express
toll lanes on Interstate 167. She said the Lynnwood connection is going on now is
expected to open in 2016 and the 167 should be done a couple of years after that. She
noted that the 405 project will feature a new definition of what a carpool is and they
are suggesting three person carpools.
Councilmember Higgins stated that he is serving on the Sound Cities Association Board
of Directors and their board retreat is January 31. He said he is also serving on the
King County Regional Transit Committee and has heard the proposal concerning
funding transit. He stated that the King County Executive can't wait on legislature so
they are going forward to create a Transportation Benefit District countywide which
would mean the twenty dollar car tab going up to sixty dollars and a 0.1% sales tax.
Sixty percent of the revenues would go to King County for Metro, saving 600,000
service hours, including five routes in Kent and the remaining 40 percent would go to
cities.
Councilmember Boyce noted that he represents the City on the board and received
consensus from the Council to present a neutral vote on this item for the Kent City
Council until the entire package is reviewed. He noted that the next meeting is
February 12.
Councilmember Thomas thanked Councilmember Berrios for his efforts in helping save
a man's life on January 1st. He noted that it was discussed at the Regional Fire
Authority meeting.
PUBLIC HEARINGS
None.
PUBLIC COMMENT
Mayor Cooke discussed the council seat vacancy and communicated that
Council President Ralph will discuss the item under Other Business.
1. Pauline Barrett, Kent - Barrett discussed the possible development of a marijuana
processing facility by her home. She communicated that the facility would be in the
center of a large residential area with high school children in the neighborhood. She
expressed concerns with security if this business is allowed to open.
2. Bill Doolittle, Kent - Doolittle communicated that when I-502 was adopted people
wanted it legalized and taxed. He stated that Kent is going out of their way to prevent
marijuana authorization and said he read that the City would be zoned to prevent it.
He urged the City to work with the liquor board to get this implemented. He said
marijuana is currently being sold, consumed, and created in the City of Kent.
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Kent City Council Meeting Minutes January 21, 2014
3. Thomas L. Brice, Kent - Brice discussed the Par 3 golf course and the vision of the
City. He said a committee has been formed by five residents and they have submitted
suggestions and ideas of what could be done concerning the course. He noted that
there is a debt and if you look at the books, the golf course isn't the problem. He
suggested the course be closed in the winter.
4. Martin Plys, Kent - Plys communicated that there is a $1.9 million surplus. He said
if there is a surplus it should be applied to the ShoWare Center and the golf course
should be sold.
Mayor Cooke verified that there isn't a surplus.
Plys opposed having any marijuana facilities in Kent.
CONSENT CALENDAR
Council President Ralph moved to approve Consent Calendar Items A through
P, seconded by Councilmember Thomas.
A. Minutes of the workshop and regular Council meeting of January P 2014 -
Approved
B. Appointment to Arts Commission —The Council confirmed the appointment of
Jennifer Treese to the Kent Arts Commission for a four year term ending October 31,
2017.
C. King County Solid Waste Division Waste Reduction & Recycling Grant -
Approved. - The Mayor was authorized to accept the Waste Reduction and Recycling
Grant Contract in the amount of $89,835 for 2014, and amend the budget and
authorize the expenditure of funds in accordance with the terms and conditions of the
grant, subject to final terms and conditions acceptable to the City Attorney and Public
Works Director.
D. Seattle-King County Health Department Local Hazardous Waste
Management Program/Recycling Event Grant- Approved. The Mayor was
authorized to accept the Local Hazardous Waste Management Program Contract in the
amount of $32,278.87 for 2014, and amend the budget and authorize the expenditure
of funds in accordance with the terms and conditions of the grant, subject to final
terms and conditions acceptable to the City Attorney and Public Works Director.
E. Contract with Olympic Environmental for 2014 -15 Residential Recycling
Collection Events- Approved. The Mayor was authorized to sign the Consultant
Services Agreement with Olympic Environmental Resources for Waste Reduction and
Recycling Activities and Programs for 2014 - 2015 in the amount of $185,551.00,
subject to final terms and conditions acceptable to the City Attorney and the Public
Works Director.
F. SR 516 to S 2315t Way Levee North Reach Improvements, Change order
No. 1- Approved. The Mayor was authorized to approve Change Order No. 1 to SCI
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Kent City Council Meeting Minutes January 21, 2014
Infrastructure, LLC in an amount not to exceed $194,059.46 for unanticipated
construction costs on the SR 516 to South 231st Way Levee, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
G. Central Avenue South Improvements Federal Grant- Accept. The Mayor was
authorized to accept a Federal Grant in the amount of $300,000 for the design phase
of the Central Avenue South Pavement Preservation Project, and amend the budget
and authorize expenditure of the funds in accordance with the terms and conditions of
the grant, subject to final terms and conditions acceptable to the City Attorney and
Public Works Director.
H. Kent Interurban Trail Connector Proiect Grant — Accept. The Mayor was
authorized to sign the grant agreement in the amount of $727,500 with the
Washington State Department of Commerce for the Kent Interurban Trail Connector
Project and amend the budget and authorize expenditure of the funds in accordance
with the terms and conditions of the grant, subject to final terms and conditions
acceptable to the City Attorney and Public Works Director.
I. South 224th Street Improvements, Phase 2 Transportation Improvement
Board (TIB) Grant- Accept. The Mayor was authorized to accept a grant from the
Washington State Transportation Improvement Board for Phase 2 of the South 224th
Street Improvement Project and sign a letter to the TIB requesting to combine Phases
1 and 2 into one project, amend the budget and authorize expenditure of the funds in
accordance with the terms and conditions of the grant, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
J. Washington Auto Theft Prevention Authority (WATPA) Patrol Task Force
2013 — 2015 Grant- Accept. The Mayor was authorized to accept the Washington
Auto Theft Prevention Authority grant award in the amount of $74,983, authorize
amending the budget and authorize expenditure of the funds in accordance with the
terms and conditions of the grant, acceptable to the City Attorney and Police Chief.
K. Ordinance Amending Kent City Code Chapter 9.02, Lewd Conduct — Adopt.
The Council adopted Ordinance No. amending Chapter 9.02 by establishing crimes
relating to lewd conduct, by amending sections relating to prostitution loitering and by
adding new areas which fall within the scope of the stay out of areas of prostitution
orders.
L. 2012 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2012 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc., upon receipt of standard releases from
the state and the release of any liens.
M. 2013 Thermo Plastic Markings Proiect Completion - Accept. They Mayor
was authorized to accept the 2013 Thermo Plastic Markings Project as complete and
release retainage to Stripe Rite Inc., upon receipt of standard releases from the state
and the release of any liens.
5
Kent City Council Meeting Minutes January 21, 2014
N. 2013 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2013 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc. upon receipt of standard releases from the
state and the release of any liens.
0. Hawley Road Levee Improvements Phase I Proiect Completion — Accept.
The Mayor was authorized to accept the Hawley Road Levee Improvements Phase I
Project as complete and release retainage to SCI Infrastructure LLC, upon receipt of
standard releases from the state and the release of any liens.
P. Horseshoe Bend and Upper Russell Road Levee Planting Proiect
Completion — Accept. The Mayor was authorized to accept the Horseshoe Bend and
Upper Russell Road Levee Plantings Project as complete and release retainage to
Restoration Logistics, upon receipt of standard releases from the state and the release
of any liens.
OTHER BUSINESS
A. Council Position No. 6 - Appointment Process - Mayor Cooke introduced the
item. Council President Ralph communicated the process and noted that the process
will be posted on the City's website and a handout was given to those in attendance by
City Clerk Moore.
Councilmember Boyce inquired what would happen with current applications and
Councilpresident Ralph communicated that she would communicate with anyone who
has previously submitted an application and inform them of the current process.
Councilmember Thomas inquired about the position and the process. Acting City
Attorney Fitzpatrick noted that the appointment lasts until the November 2015 election
is certified and whoever is elected at the general election will serve the rest of the
term.
1. Anna Davis, Kent - Davis discussed the process and inquired if the candidate that
also ran for the position in November could be considered and not have to reapply.
Mayor Cooke replied that the candidate needs to submit an application and go through
this process. She further explained the election process and said it is set up by state
law and it is up to the Council to interview and selects a candidate. She further
explained that it wasn't an option to have the runner-up in the November election
considered.
Council President Ralph also replied that this is the appointment process and that once
the November election is certified it is over. She also communicated that this
information will be on the website, channel 21, in the Kent Reporter, and announced at
Neighborhood Council meetings, etc.
BIDS
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Kent City Council Meeting Minutes January 21, 2014
A. Briscoe-Desimone Levee Improvements, Reaches 2 and 3 - Tim LaPorte,
Public Works Director introduced the levee improvements. He displayed the levee, why
the improvements are needed, and what the improvements would entail. He
communicated that there were ten excellent bids and has checked out the
qualifications of the lowest bidder, Tapani, Inc. LaPorte explained to Mayor Cooke why
this item wasn't heard at a committee, noting that a bid award doesn't go to
committee, but straight to the Council.
Councilmember Higgins moved to authorize the Mayor to award the bid for
the Briscoe-Desimone Levee Improvements Reaches 2 and 3 project to
Tapani, Inc., in the amount of $6,709,555.56 and authorize the Mayor to sign
all necessary documents, subject to the final terms and conditions acceptable
to the City Attorney and Public Works Director, seconded by Council President
Ralph. Motion carried 6-0.
LaPorte communicated that King County Flood District wants a groundbreaking
ceremony for this levee improvement this spring.
Mayor Cooke agreed and communicated that the City should also look at what park
element should be added to the south.
REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
A. Council President. Ralph stated that the B&O tax was discussed in the workshop
meeting and that the Council decided to hold off on any amendments to it at this time.
She stated that there will be a 501(c) item exemption going forth as a draft to the
Operations Committee and an item concerning 3PLs going to the Economic and
Community Development Committee at a later date.
B. Mayor. No report.
C. Administration. No report. No executive session tonight.
D. Economic & Community Development Committee. Councilmember Boyce
communicated that the next meeting is February 10.
E. Operations Committee. No report.
F. Parks and Human Services Committee. No report.
G. Public Safety Committee. No report.
H. Public Works Committee. Councilmember Higgins communicated that the
meeting yesterday was postponed and the next meetig is January 27.
I. Regional Fire Authority. Councilmember Thomas communicated that he stepped
down as chair and Mike Denfro is the chair and Higgins is the deputy chair.
EXECUTIVE SESSION ACTION AFTER EXECUTIVE SESSION
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Kent City Council Meeting Minutes January 21, 2014
No executive session was held.
ADJOURNMENT
The meeting adjourned at 8:38 p.m.
Ronald F. Moore, MMC
City Clerk
8
40.
KF14 Agenda Item: Consent — 7C
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointment to Kent Arts Commission — Confirm
MOTION: Confirm the Mayor's appointment of Lynn Bohart to the Kent
Arts Commission.
SUMMARY: Confirm the appointment of Lynn Bohart to the Kent Arts Commission for
a four year term ending October 31, 2017.
Lynn Bohart submitted an application for appointment to the Kent Arts Commission
to fill a vacant four year term. Lynn is Executive Director of the Renton Community
Foundation and remains an avid supporter of the arts. Lynn's belief is that a vibrant
arts community speaks to the soul of a city.
Lynn holds a Master's Degree in theater and has worked in Community Theater over
the years. She is a published mystery writer on Amazon.com, teaches writing through
the Kent Parks Department and Green River Community College's Continuing
Education program. She has served on the Lane County Arts Council Board while
living in Oregon and has served on the Vancouver Arts Commission before moving to
Kent.
Lynn's commitment to the Kent community and her active role in the arts makes her
an exceptional candidate for the Kent Arts Commission, and I am pleased to
recommend Lynn Bohart for your confirmation.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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KENT
° Agenda Item: Consent — 7D
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointments to Land Use and Planning Board — Confirm
MOTION: Confirm the Mayor's appointment of Katherine Jones and re-
appointment of Barbara Phillips to the Land Use & Planning Board.
SUMMARY: Confirm the appointment of Katherine Jones and re-appointment of
Barbara Phillips to the Land Use & Planning Board each for a three year term ending
December 31, 2016.
Katherine Jones made application for appointment to the Land Use & Planning Board
for a three-year term. Kathi, a Realtor with John L. Scott, lives in The Lakes
community, and feels her service on the LUPB will assist in promoting a healthier and
improved environment for all Kent citizens. Kathi's work as a realtor gives her an
understanding of the Smart Growth principles involving citizens, public officials and
stakeholders working together to plan ahead for development. Kathy has attended
many LUPB meetings and city council meetings in an effort to stay abreast of issues
confronting our community. She was an interested participant in the Midway Project,
the Cottage Housing Project, and is head of The Lakes Neighborhood Council
Kathi's commitment to the Kent community makes her an ideal candidate for the Land
Use & Planning Board, and I am pleased to recommend Kathi Jones for your
confirmation.
Barbara Phillips was first appointed to the Land Use & Planning Board in November,
2007, expressing her desire to be an integral part of the City's development and
future prosperity. Her reappointment will begin her third term which will expire on
December 31, 2016. Barbara has lived in Kent for over 20 years and currently is
President of the Community Network Council which works to connect youth with
resources that will help them become successful.
I am pleased to recommend re-appointment of Barbara Phillips to the LUPB.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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•
Nl- KENT Agenda Item: Consent- 7E
TO: City Council
DATE: February 4, 2014
SUBJECT: Refunding 2004 Limited Tax General Obligation Bond Ordinance - Adopt
MOTION: Move to adopt Ordinance No. , approving the refunding of
the 2004 Limited Tax General Obligation bonds.
SUMMARY: The 2004 LTGO bonds are callable at par on June 1, 2014 and may be
called 90 days in advance of the call date. This transaction would save an estimated
$700,000 over the eight year life of the bonds by issuing refunding bonds at a lower
interest rate. The existing bonds would be retired as of June 1 and defeased.
EXHIBITS: Ordinance
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: This transaction would reduce the debt service cost paid by the
Capital Improvements Fund by approximately $87,500 annually over the next eight
years.
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ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE OF LIMITED
TAX GENERAL OBLIGATION REFUNDING BONDS OF THE CITY
IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED
$14,000,000 TO REFUND CERTAIN OUTSTANDING LIMITED
TAX GENERAL OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM AND TERMS OF
THE BONDS; AND DELEGATING THE AUTHORITY TO
APPROVE THE FINAL TERMS OF THE BONDS.
PASSED: FEBRUARY 4, 2014
PREPARED BY:
PACIFICA LAW GROUP LLP
Seattle, Washington
CITY OF KENT
ORDINANCE NO.
TABLE OF CONTENTS*
Page
SECTION 1. - Definitions and Interpretation of Terms 2
SECTION 2. - Authorization of Bonds and Bond Details 8
SECTION 3. - Registration, Exchange and Payments 9
SECTION 4. - Redemption Prior to Maturity and Purchase
of Bonds 15
SECTION 5. - Form of Bonds 20
SECTION 6. - Execution of Bonds 22
SECTION 7. - Refunding Plan; Application of Bond
Proceeds 23
SECTION 8. - Tax Covenants 26
SECTION 9. - Bond Fund and Provision for Tax Levy
Payments 29
SECTION 10. - Defeasance 30
SECTION 11. - Sale of Bonds 31
SECTION 12. - Undertaking to Provide Ongoing Disclosure 33
SECTION 13. - Lost, Stolen or Destroyed Bonds 38
SECTION 14. - Severability; Ratification 38
SECTION 15. - Effective Date of Ordinance 40
* This Table of Contents is provided for convenience only and is not a part
of this ordinance.
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CITY OF KENT, WASHINGTON
ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE
OF LIMITED TAX GENERAL OBLIGATION
REFUNDING BONDS OF THE CITY IN THE
AGGREGATE PRINCIPAL AMOUNT OF NOT TO
EXCEED $14,000,000 TO REFUND CERTAIN
OUTSTANDING LIMITED TAX GENERAL
OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM
AND TERMS OF THE BONDS; AND DELEGATING
THE AUTHORITY TO APPROVE THE FINAL
TERMS OF THE BONDS.
A. The City of Kent, Washington (the "City") has outstanding its
Limited Tax General Obligation Refunding Bonds, 2004, issued pursuant to
Ordinance No. 3682 adopted by the City Council (the "Council") of the City
on March 16, 2004 (the "2004 Bond Ordinance"), which remain
outstanding as follows:
Maturity Date
(December 1) Principal Amount Interest Rate
2014 $ 1,875,000 5.000%
2015 1,750,000 5.250
2016 1,625,000 5.250
2017 1,445,000 5.250
2018 1,265,000 5.250
2019 1,280,000 4.000
2020 2,030,000 4.000
2021 1,325,000 4.125
(the "2004 Bonds"); and
B. The 2004 Bond Ordinance provides that the City may call the
2004 Bonds maturing on or after December 1, 2014 (the "Refunding
Candidates") for redemption on or after June 1, 2014, in whole or in part
at any time, at a price of par plus accrued interest, if any, to the date of
redemption; and
C. After due consideration it appears to the Council that all or a
portion of the Refunding Candidates may be defeased and refunded by the
proceeds of limited tax general obligation refunding bonds at a savings to
the City and its taxpayers; and
D. The Council deems it in the best interest of the City to issue
limited tax general obligation refunding bonds in the aggregate principal
amount of not to exceed $14,000,000 (the "Bonds") to redeem and
defease all or a portion of the Refunding Candidates and to pay costs of
issuing the Bonds; and
E. The Council wishes to delegate authority to the Mayor (the
"Designated Representative"), for a limited time, to approve the interest
rates, maturity dates, redemption terms and principal maturities for the
Bonds within the parameters set by this ordinance; and
F. The City expects to receive a proposal from KeyBanc Capital
Markets Inc. (the "Underwriter") and now desires to issue and sell the
Bonds to the Underwriter as set forth herein;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON DO ORDAIN as follows:
SECTION 1. - Definitions and Interpretation of Terms.
(a) Definitions. As used in this ordinance, the following words
shall have the following meanings:
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Limited Tax General Obligation Refunding Bonds, 2014
Acquired Obligations means the Government Obligations acquired
by the City under the terms of this ordinance and the Escrow Deposit
Agreement to effect the defeasance and refunding of the Refunded Bonds.
Beneficial Owner means any person that has or shares the power,
directly or indirectly, to make investment decisions concerning ownership
of any Bonds (including persons holding Bonds through nominees,
depositories or other intermediaries).
Bond Fund means the "City of Kent Limited Tax General Obligation
Bond Debt Service Fund, 2014" authorized to be created pursuant to
Section 9.
Bond Purchase Contract means the contract for the purchase of the
Bonds between the Underwriter and the City, executed pursuant to
Section 11.
Bond Register means the registration books showing the name,
address and tax identification number of each Registered Owner of the
Bonds, maintained pursuant to Section 149(a) of the Code.
Bond Registrar means, initially, the fiscal agency of the State of
Washington, for the purposes of registering and authenticating the Bonds,
maintaining the Bond Register, effecting transfer of ownership of the
Bonds and paying interest on and principal of the Bonds.
Bond Year means each one-year period that ends on the date
selected by the City. The first and last Bond Years may be short periods.
If no date is selected by the City before the earlier of the final maturity
date of Bonds or the date that is five years after the date of issuance of
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Limited Tax General Obligation Refunding Bonds, 2014
any Bonds, Bond Years end on each anniversary of the date of issue and
on the final maturity date of such Bonds.
Bonds mean the not to exceed $14,000,000 aggregate principal
amount of City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014, authorized to be issued pursuant to this
ordinance.
Call Date means June 1, 2014.
Chief Administrative Officer means the Chief Administrative Officer
or Interim Chief Administrative Officer of the City or the successor to such
officer.
City means the City of Kent, Washington, a municipal corporation
duly organized and existing under and by virtue of the Constitution and
laws of the State of Washington.
Code means the Internal Revenue Code of 1986, as amended, and
shall include all applicable regulations and rulings relating thereto.
Commission means the Securities and Exchange Commission.
Council or City Council means the legislative body of the City as
duly and regularly constituted from time to time.
Designated Representative means the Mayor, or his or her
designee.
DTC means The Depository Trust Company, New York, New York, a
limited purpose trust company organized under the laws of the State of
New York, as depository for the Bonds pursuant to Section 3.
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Limited Tax General Obligation Refunding Bonds, 2014
Escrow Agent means U.S. Bank National Association, Seattle,
Washington.
Escrow Deposit Agreement means the Escrow Deposit Agreement
between the City and the Escrow Agent to be dated as of the date of
closing of the Bonds and substantially in the form on file with the City.
Federal Tax Certificate means the certificate executed by the
Finance Director setting forth the requirements of the Code for
maintaining the tax exemption of interest on the Bonds, and attachments
thereto.
Finance Director means the Finance Director of the City or the
successor to such officer.
Financial Advisor means Piper ]affray & Co., or its successors.
Government Obligations mean those obligations now or hereafter
defined as such in chapter 39.53 RCW.
Letter of Representations means the blanket issuer letter of
representations from the City to DTC.
MSRB means the Municipal Securities Rulemaking Board or any
successors to its functions.
Net Proceeds, when used with reference to the Bonds, means the
principal amount of such Bonds, plus accrued interest and original issue
premium, if any, and less original issue discount, if any.
Private Person means any natural person engaged in a trade or
business or any trust, estate, partnership, association, company or
corporation.
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Limited Tax General Obligation Refunding Bonds, 2014
Private Person Use means the use of property in a trade or business
by a Private Person if such use is other than as a member of the general
public. Private Person Use includes ownership of the property by the
Private Person as well as other arrangements that transfer to the Private
Person the actual or beneficial use of the property (such as a lease,
management or incentive payment contract or other special arrangement)
in such a manner as to set the Private Person apart from the general
public. Use of property as a member of the general public includes
attendance by the Private Person at municipal meetings or business rental
of property to the Private Person on a short-term basis in accordance with
regulations under the Code if the rental paid by such Private Person is the
same as the rental paid by any Private Person who desires to rent the
property. Use of property by nonprofit community groups or community
recreational groups is not treated as Private Person Use if such use is
incidental to the governmental uses of property, the property is made
available for such use by all such community groups on an equal basis and
such community groups are charged only a de minimis fee to cover
custodial expenses.
Refunded Bonds mean all or a portion of the Refunding Candidates
designated by the Designated Representative for refunding pursuant to
Section 7 and Section 11.
Refunding Account means the account by that name established
pursuant to Section 7.
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Limited Tax General Obligation Refunding Bonds, 2014
Refunding Candidates mean the 2004 Bonds maturing on or after
December 1, 2014.
Registered Owner means the person named as the registered owner
of a Bond in the Bond Register. For so long as the Bonds are held in book-
entry only form, DTC or its nominee shall be deemed to be the sole
Registered Owner.
Rule means the Commission's Rule 15c2-12 under the Securities
Exchange Act of 1934, as the same may be amended from time to time.
2004 Bond Ordinance means Ordinance No. 3682 adopted by the
Council on March 16, 2004 authorizing the issuance of the 2004 Bonds.
2004 Bonds mean the City of Kent, Washington, Limited Tax
General Obligation Refunding Bonds, 2004 issued pursuant to the 2004
Bond Ordinance as described in the recitals of this ordinance.
Underwriter means KeyBanc Capital Markets Inc., or its successors.
(b) Interpretation. In this ordinance, unless the context
otherwise requires:
(1) The terms "hereby," "hereof," "hereto," "herein,"
"hereunder" and any similar terms, as used in this ordinance, refer to this
ordinance as a whole and not to any particular article, section, subdivision
or clause hereof, and the term "hereafter" shall mean after, and the term
"heretofore" shall mean before, the date of this ordinance;
(2) Words of the masculine gender shall mean and include
correlative words of the feminine and neuter genders and words importing
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Limited Tax General Obligation Refunding Bonds, 2014
the singular number shall mean and include the plural number and vice
versa;
(3) Words importing persons shall include firms,
associations, partnerships (including limited partnerships), trusts,
corporations and other legal entities, including public bodies, as well as
natural persons;
(4) Any headings preceding the text of the several articles
and sections of this ordinance, and any table of contents or marginal notes
appended to copies hereof, shall be solely for convenience of reference
and shall not constitute a part of this ordinance, nor shall they affect its
meaning, construction or effect; and
(5) All references herein to "articles," "sections" and other
subdivisions or clauses are to the corresponding articles, sections,
subdivisions or clauses hereof.
SECTION 2,- Authorization of Bonds and Bond Details. For the
purpose of refunding the Refunded Bonds and paying costs of issuance of
the Bonds, the City shall issue and sell limited tax general obligation
refunding bonds in the aggregate principal amount of not to exceed
$14,000,000 (the "Bonds").
The Bonds shall be general obligations of the City, shall be
designated "City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014" with other such designation as set forth in the
Bond Purchase Contract and approved by the Designated Representative.
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Limited Tax General Obligation Refunding Bonds, 2014
The Bonds shall be dated as of their date of initial delivery, shall be
fully registered as to both principal and interest, shall be in the
denomination of $5,000 each or any integral multiple thereof within a
maturity, shall be numbered separately in the manner and with any
additional designation as the Bond Registrar deems necessary for
purposes of identification and control, and shall bear interest payable on
the dates set forth in the Bond Purchase Contract. The Bonds shall bear
interest at the rates set forth in the Bond Purchase Contract; and shall
mature on the dates and in the principal amounts set forth in the Bond
Purchase Contract and as approved by a Designated Representative
pursuant to Section 11.
SECTION 3. - Registration, Exchange and Payments.
(a) Bond Registrar/Bond Register. The City hereby specifies and
adopts the system of registration approved by the Washington State
Finance Committee from time to time through the appointment the state
fiscal agency. The City shall cause a Bond Register to be maintained by
the Bond Registrar. So long as any Bonds remain outstanding, the Bond
Registrar shall make all necessary provisions to permit the exchange or
registration or transfer of Bonds at its principal corporate trust office. The
Bond Registrar may be removed at any time at the option of the Finance
Director upon prior notice to the Bond Registrar and a successor Bond
Registrar appointed by the Finance Director. No resignation or removal of
the Bond Registrar shall be effective until a successor shall have been
appointed and until the successor Bond Registrar shall have accepted the
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Limited Tax General Obligation Refunding Bonds, 2014
duties of the Bond Registrar hereunder. The Bond Registrar is authorized,
on behalf of the City, to authenticate and deliver Bonds transferred or
exchanged in accordance with the provisions of such Bonds and this
ordinance and to carry out all of the Bond Registrar's powers and duties
under this ordinance. The Bond Registrar shall be responsible for its
representations contained in the Certificate of Authentication of the Bonds.
(b) Registered Ownership. The City and the Bond Registrar, each
in its discretion, may deem and treat the Registered Owner of each Bond
as the absolute owner thereof for all purposes (except as provided in
Section 12 of this ordinance), and neither the City nor the Bond Registrar
shall be affected by any notice to the contrary. Payment of any such Bond
shall be made only as described in Section 3(h), but such Bond may be
transferred as herein provided. All such payments made as described in
Section 3(h) shall be valid and shall satisfy and discharge the liability of
the City upon such Bond to the extent of the amount or amounts so paid.
(c) DTC Acceptance/Letters of Representations. The Bonds
initially shall be held in fully immobilized form by DTC acting as
depository. To induce DTC to accept the Bonds as eligible for deposit at
DTC, the City has executed and delivered to DTC a Blanket Issuer Letter of
Representations. Neither the City nor the Bond Registrar will have any
responsibility or obligation to DTC participants or the persons for whom
they act as nominees (or any successor depository) with respect to the
Bonds in respect of the accuracy of any records maintained by DTC (or
any successor depository) or any DTC participant, the payment by DTC (or
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Limited Tax General Obligation Refunding Bonds, 2014
any successor depository) or any DTC participant of any amount in respect
of the principal of or interest on Bonds, any notice which is permitted or
required to be given to Registered Owners under this ordinance (except
such notices as shall be required to be given by the City to the Bond
Registrar or to DTC (or any successor depository)), or any consent given
or other action taken by DTC (or any successor depository) as the
Registered Owner. For so long as any Bonds are held in fully immobilized
form by a depository, DTC or its successor depository shall be deemed to
be the Registered Owner for all purposes hereunder, and all references
herein to the Registered Owners shall mean DTC (or any successor
depository) or its nominee and shall not mean the owners of any beneficial
interest in such Bonds.
(d) Use of Depository.
(1) The Bonds shall be registered initially in the name of
"Cede & Co.", as nominee of DTC, with one Bond maturing on each of the
maturity dates for the Bonds in a denomination corresponding to the total
principal therein designated to mature on such date. Registered
ownership of such Bonds, or any portions thereof, may not thereafter be
transferred except (A) to any successor of DTC or its nominee, provided
that any such successor shall be qualified under any applicable laws to
provide the service proposed to be provided by it; (B) to any substitute
depository appointed by the Finance Director pursuant to subsection (2)
below or such substitute depository's successor; or (C) to any person as
provided in subsection (4) below.
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Limited Tax General Obligation Refunding Bonds, 2014
(2) Upon the resignation of DTC or its successor (or any
substitute depository or its successor) from its functions as depository or a
determination by the Finance Director to discontinue the system of book
entry transfers through DTC or its successor (or any substitute depository
or its successor), the Finance Director may hereafter appoint a substitute
depository. Any such substitute depository shall be qualified under any
applicable laws to provide the services proposed to be provided by it.
(3) In the case of any transfer pursuant to clause (A) or
(B) of subsection (1) above, the Bond Registrar shall, upon receipt of all
outstanding Bonds, together with a written request on behalf of the
Finance Director, issue a single new Bond for each maturity then
outstanding, registered in the name of such successor or such substitute
depository, or their nominees, as the case may be, all as specified in such
written request of the Finance Director.
(4) In the event that (A) DTC or its successor (or
substitute depository or its successor) resigns from its functions as
depository, and no substitute depository can be obtained, or (B) the
Finance Director determines that it is in the best interest of the beneficial
owners of the Bonds that such owners be able to obtain physical Bond
certificates, the ownership of such Bonds may then be transferred to any
person or entity as herein provided, and such Bonds shall no longer be
held by a depository. The Finance Director shall deliver a written request
to the Bond Registrar, together with a supply of physical Bonds, to issue
Bonds as herein provided in any authorized denomination. Upon receipt
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Limited Tax General Obligation Refunding Bonds, 2014
by the Bond Registrar of all then outstanding Bonds together with a
written request on behalf of the Finance Director to the Bond Registrar,
new Bonds shall be issued in the appropriate denominations and
registered in the names of such persons as are requested in such written
request.
(e) Registration of Transfer of Ownership or Exchange; Change in
Denominations. The transfer of any Bond may be registered and Bonds
may be exchanged, but no transfer of any such Bond shall be valid unless
it is surrendered to the Bond Registrar with the assignment form
appearing on such Bond duly executed by the Registered Owner or such
Registered Owner's duly authorized agent in a manner satisfactory to the
Bond Registrar. Upon such surrender, the Bond Registrar shall cancel the
surrendered Bond and shall authenticate and deliver, without charge to
the Registered Owner or transferee therefor, a new Bond (or Bonds at the
option of the new Registered Owner) of the same date, maturity and
interest rate and for the same aggregate principal amount in any
authorized denomination, naming as Registered Owner the person or
persons listed as the assignee on the assignment form appearing on the
surrendered Bond, in exchange for such surrendered and cancelled Bond.
Any Bond may be surrendered to the Bond Registrar and exchanged,
without charge, for an equal aggregate principal amount of Bonds of the
same date, maturity and interest rate, in any authorized denomination.
The Bond Registrar shall not be obligated to register the transfer or to
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Limited Tax General Obligation Refunding Bonds, 2014
exchange any Bond during the 15 days preceding any principal payment
date any such Bond is to be redeemed.
(f) Bond Registrar's Ownership of Bonds. The Bond Registrar
may become the Registered Owner of any Bond with the same rights it
would have if it were not the Bond Registrar, and to the extent permitted
by law, may act as depository for and permit any of its officers or directors
to act as a member of, or in any other capacity with respect to, any
committee formed to protect the right of the Registered Owners of Bonds.
(g) Registration Covenant. The City covenants that, until all
Bonds have been surrendered and canceled, it will maintain a system for
recording the ownership of each Bond that complies with the provisions of
Section 149 of the Code.
(h) Place and Medium of Payment. 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 calculated on the basis of a year
of 360 days and twelve 30-day months. For so long as all Bonds are held
by a depository, payments of principal and interest thereon shall be made
as provided in accordance with the operational arrangements of DTC
referred to in the Letter of Representations. In the event that the Bonds
are no longer held by a depository, interest on the Bonds shall be paid by
check or draft mailed to the Registered Owners at the addresses for such
Registered Owners appearing on the Bond Register on the fifteenth day of
the month preceding the interest payment date, or upon the written
request of a Registered Owner of more than $1,000,000 of Bonds
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(received by the Bond Registrar at least 15 days prior to the applicable
payment date), such payment shall be made by the Bond Registrar by
wire transfer to the account within the United States designated by the
Registered Owner. Principal of the Bonds shall be payable upon
presentation and surrender of such Bonds by the Registered Owners at the
principal office of the Bond Registrar.
If any Bond shall be duly presented for payment and funds have not
been duly provided by the City on such applicable date, then interest shall
continue to accrue thereafter on the unpaid principal thereof at the rate
stated on such Bond until it is paid.
SECTION 4, - Redemption Prior to Maturity and Purchase of Bonds.
(a) Mandatory Redemption of Term Bonds and Optional
Redemption, if any. The Bonds shall be subject to optional redemption on
the dates, at the prices and under the terms set forth in the Bond
Purchase Contract approved by the Designated Representative pursuant to
Section 11. The Bonds shall be subject to mandatory redemption to the
extent, if any, set forth in the Bond Purchase Contract approved by the
Designated Representative pursuant to Section 11.
(b) Purchase of Bonds. The City reserves the right to purchase
any of the Bonds offered to it at any time at a price deemed reasonable by
the Finance Director.
(c) Selection of Bonds for Redemption. For as long as the Bonds
are held in book-entry only form, the selection of particular Bonds within a
maturity to be redeemed shall be made in accordance with the operational
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arrangements then in effect at DTC. If the Bonds are no longer held in
uncertificated form, the selection of such Bonds to be redeemed and the
surrender and reissuance thereof, as applicable, shall be made as provided
in the following provisions of this subsection (c). If the City redeems at
any one time fewer than all of the Bonds having the same maturity date,
the particular Bonds or portions of Bonds of such maturity to be redeemed
shall be selected by lot (or in such manner determined by the Bond
Registrar) in increments of $5,000. In the case of a Bond of a
denomination greater than $5,000, the City and the Bond Registrar shall
treat each Bond as representing such number of separate Bonds each of
the denomination of $5,000 as is obtained by dividing the actual principal
amount of Bonds by $5,000. In the event that only a portion of the
principal sum of a Bond is redeemed, upon surrender of such Bond at the
principal office of the Bond Registrar there shall be issued to the
Registered Owner, without charge therefor, for the then unredeemed
balance of the principal sum thereof, at the option of the Registered
Owner, a Bond or Bonds of like maturity and interest rate in any of the
denominations herein authorized.
(d) Notice of Redemption.
(1) Official Notice. For so long as the Bonds are held in
uncertificated form, notice of redemption (which notice may be
conditional) shall be given in accordance with the operational
arrangements of DTC as then in effect, and neither the City nor the Bond
Registrar will provide any notice of redemption to any Beneficial Owners.
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Thereafter (if the Bonds are no longer held in uncertificated form), notice
of redemption shall be given in the manner hereinafter provided. Unless
waived by any owner of Bonds to be redeemed, official notice of any such
redemption (which redemption may be conditioned by the Bond Registrar
on the receipt of sufficient funds for redemption or otherwise) shall be
given by the Bond Registrar on behalf of the City by mailing a copy of an
official redemption notice by first class mail at least 20 days and not more
than 60 days prior to the date fixed for redemption to the Registered
Owner of the Bond or Bonds to be redeemed at the address shown on the
Bond Register or at such other address as is furnished in writing by such
Registered Owner to the Bond Registrar.
All official notices of redemption shall be dated and shall state:
(A) the redemption date,
(B) the redemption price,
(C) if fewer than all outstanding Bonds are to be
redeemed, the identification by maturity (and, in the case of partial
redemption, the respective principal amounts) of the Bonds to be
redeemed,
(D) that (unless such notice is conditional) on the
redemption date the redemption price will become due and payable upon
each such Bond or portion thereof called for redemption, and that interest
thereon shall cease to accrue from and after said date, and
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(E) the place where such Bonds are to be
surrendered for payment of the redemption price, which place of payment
shall be the principal office of the Bond Registrar.
On or prior to any redemption date (unless such notice is
conditional), the City shall deposit with the Bond Registrar an amount of
money sufficient to pay the redemption price of all the Bonds or portions
of Bonds which are to be redeemed on that date.
(2) Effect of Notice; Bonds Due. If an unconditional notice
of redemption has been given as aforesaid, or if the conditions to
redemption have been satisfied or waived, the Bonds or portions of Bonds
so to be redeemed shall, on the redemption date, become due and
payable at the redemption price therein specified, and from and after such
date such Bonds or portions of Bonds shall cease to bear interest. Upon
surrender of such Bonds for redemption in accordance with said notice,
such Bonds shall be paid by the Bond Registrar at the redemption price.
Installments of interest due on or prior to the redemption date shall be
payable as herein provided for payment of interest. All Bonds which have
been redeemed shall be canceled by the Bond Registrar and shall not be
reissued.
If a conditional notice of redemption has been given and the
conditions to redemption have not been satisfied or waived, notice of
redemption given pursuant to this ordinance may be rescinded by written
notice given by the Bond Registrar on behalf of the City as soon as
practicable in the same manner, and to the same Registered Owners of
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the Bond or Bonds, as notice of such redemption was given pursuant to
this Section 4(d). If notice of recession has been provided, the Bonds or
portions of Bonds so to be redeemed, on the redemption date, shall not
become due and payable and from and after such date such Bonds or
portions of Bonds shall continue to bear interest at the rate or rates set
forth therein until paid or until due provision is made for the payment of
the same.
(3) Additional Notice. In addition to the foregoing notice,
further notice shall be given by the City as set out below, but no defect in
said further notice nor any failure to give all or any portion of such further
notice shall in any manner defeat the effectiveness of a call for redemption
if notice thereof is given as above prescribed. Each further notice of
redemption given hereunder shall contain the information required above
for an official notice of redemption plus (A) the CUSIP numbers of all
Bonds being redeemed; (B) the date of issue of the Bonds as originally
issued; (C) the rate of interest borne by each Bond being redeemed;
(D) the maturity date of each Bond being redeemed; and (E) any other
descriptive information needed to identify accurately the Bonds being
redeemed. Each further notice of redemption may be sent at least
20 days before the redemption date to each party entitled to receive
notice pursuant to Section 12 and with such additional information as the
City shall deem appropriate, but such mailings shall not be a condition
precedent to the redemption of such Bonds.
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(4) Amendment of Notice Provisions. The foregoing notice
provisions of this Section 4, including but not limited to the information to
be included in redemption notices and the persons designated to receive
notices, may be amended by additions, deletions and changes in order to
maintain compliance with duly promulgated regulations and
recommendations regarding notices of redemption of municipal securities.
SECTIONS. - Form of Bonds. The Bonds shall be in substantially
the following form with appropriate or necessary insertions, depending
upon the omissions and variations as permitted or required hereby:
UNITED STATES OF AMERICA
NO. $
STATE OF WASHINGTON
CITY OF KENT
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2014
INTEREST RATE: % MATURITY DATE: CUSIP NO.:
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The City of Kent, Washington (the "City"), hereby acknowledges
itself to owe and for value received promises to pay to the Registered
Owner identified above, or registered assigns, on the Maturity Date
identified above, the Principal Amount indicated above and to pay interest
thereon from , 2014, or the most recent date to which
interest has been paid or duly provided for until payment of this bond at
the Interest Rate set forth above, payable on and
semiannually thereafter on the first days of each succeeding and
Both principal of and interest on this bond are payable in lawful
money of the United States of America. The fiscal agency of the State of
Washington has been appointed by the City as the authenticating agent,
paying agent and registrar for the bonds of this issue (the "Bond
Registrar"). For so long as the bonds of this issue are held in fully
immobilized form, payments of principal and interest thereon shall be
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made as provided in accordance with the operational arrangements of The
Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter
of Representations (the "Letter of Representations") from the City to DTC.
The bonds of this issue are issued under and in accordance with the
provisions of the Constitution and applicable statutes of the State of
Washington and Ordinance No. duly passed by the City Council
on February 4, 2014 (the "Bond Ordinance"). Capitalized terms used in
this bond have the meanings given such terms in the Bond Ordinance.
This bond shall not be valid or become obligatory for any purpose or
be entitled to any security or benefit under the Bond Ordinance until the
Certificate of Authentication hereon shall have been manually signed by or
on behalf of the Bond Registrar or its duly designated agent.
This bond is one of an authorized issue of bonds of like series, date,
tenor, rate of interest and date of maturity, except as to number and
amount in the aggregate principal amount of $ and is issued
pursuant to the Bond Ordinance to provide a portion of the funds
necessary (a) to defease and refund certain limited tax general obligation
bonds of the City, and (b) to pay costs of issuance.
[The bonds of this issue are subject to redemption as provided in
the Bond Ordinance and the Bond Purchase Contract.]
The City hereby irrevocably covenants and agrees with the owner of
this bond that it will include in its annual budget and levy taxes annually,
within and as a part of the tax levy permitted to the City without a vote of
the electorate, upon all the property subject to taxation in amounts
sufficient, together with other money legally available therefor, to pay the
principal of and interest on this bond as the same shall become due. The
full faith, credit and resources of the City are hereby irrevocably pledged
for the annual levy and collection of such taxes and the prompt payment
of such principal and interest.
[The bonds of this issue have [not] been designated by the City as
"qualified tax-exempt obligations" for investment by financial institutions
under Section 265(b) of the Code.]
The pledge of tax levies for payment of principal of and interest on
the bonds may be discharged prior to maturity of the bonds by making
provision for the payment thereof on the terms and conditions set forth in
the Bond Ordinance.
It is hereby certified that all acts, conditions and things required by
the Constitution and statutes of the State of Washington to exist and to
have happened, been done and performed precedent to and in the
issuance of this bond exist and have happened, been done and performed
and that the issuance of this bond and the bonds of this issue does not
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violate any constitutional, statutory or other limitation upon the amount of
bonded indebtedness that the City may incur.
IN WITNESS WHEREOF, the City of Kent, Washington has caused
this bond to be executed by the manual or facsimile signatures of the
Mayor and the City Clerk and the seal of the City imprinted, impressed or
otherwise reproduced hereon as of this _ day of 2014.
[SEAL]
CITY OF KENT,
WASHINGTON
By /s/ manual or facsimile
Mayor
ATTEST:
/s/ manual or facsimile
City Clerk
The Bond Registrar's Certificate of Authentication on the Bonds shall
be in substantially the following form:
CERTIFICATE OF AUTHENTICATION
This bond is one of the bonds described in the within-mentioned
Bond Ordinance and is one of the Limited Tax General Obligation
Refunding Bonds, 2014 of the City of Kent, Washington, dated
2014.
WASHINGTON STATE FISCAL
AGENCY, as Bond Registrar
By
SECTION 6. - Execution of Bonds. The Bonds shall be executed on
behalf of the City with the manual or facsimile signature of the Mayor and
attested by the manual or facsimile signature of the City Clerk and the
seal of the City shall be impressed, imprinted or otherwise reproduced
thereon.
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Only such Bonds as shall bear thereon a Certificate of
Authentication in the form hereinbefore recited, manually executed by the
Bond Registrar, shall be valid or obligatory for any purpose or entitled to
the benefits of this ordinance. Such Certificate of Authentication shall be
conclusive evidence that the Bonds so authenticated have been duly
executed, authenticated and delivered hereunder and are entitled to the
benefits of this ordinance.
In case either of the officers who shall have executed the Bonds
shall cease to be an officer or officers of the City before the Bonds so
signed shall have been authenticated or delivered by the Bond Registrar,
or issued by the City, such Bonds may nevertheless be authenticated,
delivered and issued and upon such authentication, delivery and issuance,
shall be as binding upon the City as though those who signed the same
had continued to be such officers of the City. Any Bond may be signed
and attested on behalf of the City by such persons who at the date of the
actual execution of such Bond, are the proper officers of the City, although
at the original date of such Bond any such person shall not have been
such officer of the City.
SECTION 7. - Refunding Plan; Application of Bond Proceeds.
(a) Refunding Plan. For the purpose of realizing a debt service
savings, the City proposes to defease and refund the Refunded Bonds as
set forth herein. The Refunded Bonds shall include all or a portion of the
Refunding Candidates as designated by the Designated Representative
and set forth in the Bond Purchase Contract. Proceeds of the Bonds shall
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be deposited with the Escrow Agent pursuant to the Escrow Deposit
Agreement to be used immediately upon receipt thereof to defease the
Refunded Bonds as authorized by the 2004 Bond Ordinance and to pay
costs of issuance of the Bonds.
The net proceeds deposited with the Escrow Agent shall be used to
defease the Refunded Bonds and discharge the obligations thereon by the
purchase of certain Government Obligations (which obligations so
purchased, are herein called "Acquired Obligations"), bearing such interest
and maturing as to principal and interest in such amounts and at such
times which, together with any necessary beginning cash balance, will
provide for the payment of:
(1) interest on the Refunded Bonds as such becomes due
on and prior to the Call Date; and
(2) the redemption price (100% of the principal amount)
of the Refunded Bonds on the Call Date.
Such Acquired Obligations shall be purchased at a yield not greater
than the yield permitted by the Code and regulations relating to acquired
obligations in connection with refunding bond issues.
(b) Escrow Agent/Escrow Deposit Agreement. The City hereby
appoints U.S. Bank National Association, Seattle, Washington, as the
Escrow Agent for the Refunded Bonds (the "Escrow Agent'). A beginning
cash balance, if any, and the Acquired Obligations shall be deposited
irrevocably with the Escrow Agent in an amount sufficient to defease the
Refunded Bonds. The proceeds of the Bonds remaining after acquisition of
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Limited Tax General Obligation Refunding Bonds, 2014
the Acquired Obligations and provision for the necessary beginning cash
balance shall be utilized to pay expenses of the acquisition and
safekeeping of the Acquired Obligations and costs of issuance of the
Bonds.
In order to carry out the purposes of this Section 7, the Finance
Director is authorized and directed to execute and deliver to the Escrow
Agent, an Escrow Deposit Agreement.
(c) Call for Redemption of Refunded Bonds. The City hereby sets
aside sufficient funds out of the purchase of Acquired Obligations from
proceeds of the Bonds to make the payments described above.
The City hereby calls the Refunded Bonds for redemption on their
Call Date in accordance with the provisions of the 2004 Bond Ordinance
authorizing the redemption and retirement of the 2004 Bonds, prior to
their fixed maturities.
Said defeasance and call for redemption of the Refunded Bonds
shall be irrevocable after the issuance of the Bonds and delivery of the
Acquired Obligations to the Escrow Agent.
The Escrow Agent is hereby authorized and directed to provide for
the giving of notices of the redemption of the Refunded Bonds in
accordance with the applicable provisions of the 2004 Bond Ordinance.
The costs of publication of such notices shall be an expense of the City.
The Escrow Agent is hereby authorized and directed to pay to the
Finance Director, or, at the direction of the Finance Director, to the paying
agent for the Refunded Bonds, sums sufficient to pay, when due, the
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payments specified in this Section 7. All such sums shall be paid from the
moneys and Acquired Obligations deposited with the Escrow Agent, and
the income therefrom and proceeds thereof. All such sums so paid to or
to the order of the Finance Director shall be credited to the Refunding
Account. All moneys and Acquired Obligations deposited with the Escrow
Agent and any income therefrom shall be held, invested (but only at the
direction of the Finance Director) and applied in accordance with the
provisions of this ordinance and with the laws of the State of Washington
for the benefit of the City and owners of the Refunded Bonds.
The City will take such actions as are found necessary to see that all
necessary and proper fees, compensation and expenses of the Escrow
Agent for the Refunded Bonds shall be paid when due.
SECTION B. - Tax Covenants.
The City covenants that it will not take or permit to be taken on its
behalf any action that would adversely affect the exemption from federal
income taxation of the interest on the Bonds 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 Bonds.
(a) Arbitrage Covenant. 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 proceeds of sale of the Bonds or any other
funds of the City which may be deemed to be proceeds of the Bonds
pursuant to Section 148 of the Code and the regulations promulgated
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thereunder which, if such use had been reasonably expected on the dates
of delivery of the Bonds to the initial purchasers thereof, would have
caused the Bonds to be treated as "arbitrage bonds" within the meaning of
such term as used in Section 148 of the Code. The City will comply with
the requirements of Section 148 of the Code and the applicable
regulations thereunder throughout the term of the Bonds.
(b) Private Person Use Limitation for the Bonds. The City
covenants that for as long as the Bonds are outstanding, it will not permit:
(1) More than 10% of the Net Proceeds of the Bonds to be
allocated to any Private Person Use; and
(2) More than 10% of the principal or interest payments
on the Bonds in a Bond Year to be directly or indirectly: (A) secured by
any interest in property used or to be used for any Private Person Use or
secured by payments in respect of property used or to be used for any
Private Person Use, or (B) derived from payments (whether or not made
to the City) in respect of property, or borrowed money, used or to be used
for any Private Person Use.
The City further covenants that, if:
(3) More than five percent of the Net Proceeds of the
Bonds are allocable to any Private Person Use; and
(4) More than five percent of the principal or interest
payments on the Bonds in a Bond Year are (under the terms of this
ordinance or any underlying arrangement) directly or indirectly:
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(A) secured by any interest in property used or to be
used for any Private Person Use or secured by payments in respect
of property used or to be used for any Private Person Use, or
(B) derived from payments (whether or not made to
the City) in respect of property, or borrowed money, used or to be
used for any Private Person Use, then, (i) any Private Person Use of
the projects described in subsection (3) hereof or Private Person
Use payments described in subsection (4) hereof that is in excess of
the five percent limitations described in such subsections (3) or (4)
will be for a Private Person Use that is related to the state or local
governmental use of the projects refunded by the proceeds of the
Bonds, and (ii) any Private Person Use will not exceed the amount
of Net Proceeds of the Bonds allocable to the state or local
governmental use portion of the projects(s) to which the Private
Person Use of such portion of the projects refunded by the proceeds
of the Bonds relate. The City further covenants that it will comply
with any limitations on the use of the projects refunded by the
proceeds of the Bonds by other than state and local governmental
users that are necessary, in the opinion of its bond counsel, to
preserve the tax exemption of the interest on the Bonds.
(c) Modification of Tax Covenants. The covenants of this section
are specified solely to assure the continued exemption from regular
income taxation of the interest on the Bonds. To that end, the provisions
of this section may be modified or eliminated without any requirement for
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formal amendment thereof upon receipt of an opinion of the City's bond
counsel that such modification or elimination will not adversely affect the
tax exemption of interest on any Bonds.
(d) In the Federal Tax Certificate the City may designate the
Bonds as "qualified tax-exempt obligations" under Section 265(b)(3) of
the Code for investment by financial institutions if at the time of such
designation it reasonably does not expect to issue more than $10,000,000
in qualifying tax-exempt debt during calendar year 2014.
SECTION 9. - Bond Fund and Provision for Tax Levy Payments.
The City hereby authorizes the creation of a fund to be used for the
payment of debt service on the Bonds, designated as the "City of Kent
Limited Tax General Obligation Bond Debt Service Fund, 2014" (the "Bond
Fund"). No later than the date each payment of principal of or interest on
the Bonds becomes due, the City shall transmit sufficient funds, from the
Bond Fund or from other legally available sources, to the Bond Registrar
for the payment of such principal or interest. Money in the Bond Fund
may be invested in legal investments for City funds.
The City hereby irrevocably covenants and agrees for as long as any
of the Bonds are outstanding and unpaid that each year it will include in
its budget and levy an ad valorem tax upon all the property within the City
subject to taxation in an amount that will be sufficient, together with all
other revenues and money of the City legally available for such purposes,
to pay the principal of and interest on the Bonds when due.
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The City hereby irrevocably pledges that the annual tax provided for
herein to be levied for the payment of such principal and interest shall be
within and as a part of the tax levy permitted to cities without a vote of
the people, and that a sufficient portion of each annual levy to be levied
and collected by the City prior to the full payment of the principal of and
interest on the Bonds will be and is hereby irrevocably set aside, pledged
and appropriated for the payment of the principal of and interest on the
Bonds. The full faith, credit and resources of the City are hereby
irrevocably pledged for the annual levy and collection of said taxes and for
the prompt payment of the principal of and interest on the Bonds when
due.
SECTION 10. - Defeasance. In the event that the City, to effect
the payment, retirement or redemption of any Bond, sets aside in the
Bond Fund or in another special account, cash or noncallable Government
Obligations, or any combination of cash and/or noncallable Government
Obligations, in amounts and maturities which, together with the known
earned income therefrom, are sufficient to redeem or pay and retire such
Bond in accordance with its terms and to pay when due the interest and
redemption premium, if any, thereon, and such cash and/or noncallable
Government Obligations are irrevocably set aside and pledged for such
purpose, then no further payments need be made into the Bond Fund for
the payment of the principal of and interest on such Bond. The owner of a
Bond so provided for shall cease to be entitled to any lien, benefit or
security of this ordinance except the right to receive payment of principal,
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premium, if any, and interest from the Bond Fund or such special account,
and such Bond shall be deemed to be not outstanding under this
ordinance.
The City shall give written notice of defeasance to the owners of all
Bonds so provided for within 30 days of the defeasance and to each party
entitled to receive notice in accordance with Section 12.
SECTION 11. - Sale of Bonds.
(a) Bond Sale. The Bonds shall be sold at negotiated sale to the
Underwriter pursuant to the terms of the Bond Purchase Contract. The
Financial Advisor has advised the Council that market conditions are
fluctuating and, as a result, the most favorable market conditions may
occur on a day other than a regular meeting date of the Council. The
Council has determined that it would be in the best interest of the City to
delegate to the Designated Representative for a limited time the authority
to approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, selection of the Refunded Bonds,
and redemption rights.
The Designated Representative is hereby authorized to designate a
portion or all of the Refunding Candidates as Refunded Bonds, and to
approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, and redemption rights for the
Bonds in the manner provided hereafter so long as (i) the aggregate
principal amount of the Bonds does not exceed $14,000,000, (ii) the final
maturity date for the Bonds is no later than December 1, 2021, (iii) the
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Bonds are sold (in the aggregate) at a price not less than 97% and not
greater than 120%, (iv) the Bonds are sold for a price that results in a
minimum net present value debt service savings over the Refunded Bonds
of at least 3.0%, (v) the true interest cost for the Bonds (in the
aggregate) does not exceed 3.5%; and (vi) the Bonds conform to all other
terms of this ordinance. Subject to the terms and conditions set forth in
this section, the Designated Representative is hereby authorized to
execute the Bond Purchase Contract.
Following the execution of the Bond Purchase Contract, the Finance
Director shall provide a report to the Council describing the final terms of
the Bonds approved pursuant to the authority delegated in this section.
The authority granted to the Designated Representative by this Section 11
shall expire 120 days after the effective date of this ordinance. If a Bond
Purchase Contract for the Bonds has not been executed within 120 days
after the effective date of this ordinance, the authorization for the
issuance of the Bonds shall be rescinded, and the Bonds shall not be
issued nor their sale approved unless such Bonds shall have been re-
authorized by ordinance of the Council. The ordinance re-authorizing the
issuance and sale of such Bonds may be in the form of a new ordinance
repealing this ordinance in whole or in part or may be in the form of an
amendatory ordinance approving a bond purchase contract or establishing
terms and conditions for the authority delegated under this Section 11.
(b) Delivery of Bonds; Documentation. Upon the passage and
approval of this ordinance, the proper officials of the City, including the
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Finance Director and Chief Administrative Officer, are authorized and
directed to undertake all action necessary for the prompt execution and
delivery of the Bonds to the Underwriter and further to execute all closing
certificates and documents required to effect the closing and delivery of
the Bonds in accordance with the terms of this ordinance and the Bond
Purchase Contract.
(c) Preliminary and Final Official Statements. The Finance
Director is hereby authorized to ratify and to deem final the preliminary
Official Statement relating to the Bonds for the purposes of the Rule. The
Finance Director is further authorized to ratify and to approve for purposes
of the Rule, on behalf of the City, the final Official Statement relating to
the issuance and sale of the Bonds and the distribution of the final Official
Statement pursuant thereto with such changes, if any, as may be deemed
by her to be appropriate.
SECTION 12. - Undertaking to Provide Ongoing Disclosure.
(a) Contract/Undertaking. This section constitutes the City's
written undertaking for the benefit of the owners, including Beneficial
Owners, of the Bonds as required by Section (b)(5) of the Rule.
(b) Financial Statements/Operating Data. The City agrees to
provide or cause to be provided to the MSRB the following annual financial
information and operating data for the prior fiscal year (commencing in
2014 for the fiscal year ended December 31, 2013):
1. Annual financial statements, which statements may or
may not be audited, showing ending fund balances for the City's general
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Limited Tax General Obligation Refunding Bonds, 2014
fund prepared in accordance with the Budgeting Accounting and Reporting
System prescribed by the Washington State Auditor pursuant to
RCW 43.09.200 (or any successor statute) and generally of the type
specified in the official statement for the Bonds;
2. The assessed valuation of taxable property in the City;
3. Ad valorem taxes due and percentage of taxes
collected;
4. Property tax levy rate per $1,000 of assessed
valuation; and
5. Outstanding general obligation debt of the City.
Items 2-5 shall be required only to the extent that such information is not
included in the annual financial statements.
The information and data described above shall be provided on or
before nine months after the end of the City's fiscal year. The City's
current fiscal year ends December 31. The City may adjust such fiscal
year by providing written notice of the change of fiscal year to the MSRB.
In lieu of providing such annual financial information and operating data,
the City may cross-reference to other documents available to the public on
the MSRB's internet website or filed with the Commission.
If not provided as part of the annual financial information discussed
above, the City shall provide to the MSRB the City's audited annual
financial statements prepared in accordance with the Budgeting
Accounting and Reporting System prescribed by the Washington State
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Limited Tax General Obligation Refunding Bonds, 2014
Auditor pursuant to RCW 43.09.200 (or any successor statute) when and if
available.
(c) Listed Events. The City agrees to provide or cause to be
provided to the MSRB, in a timely manner not in excess of ten business
days after the occurrence of the event, notice of the occurrence of any of
the following events with respect to the Bonds:
• Principal and interest payment delinquencies;
• Non-payment related defaults, if material;
• Unscheduled draws on debt service reserves reflecting
financial difficulties;
• Unscheduled draws on credit enhancements reflecting
financial difficulties;
• Substitution of credit or liquidity providers, or their failure to
perform;
• Adverse tax opinions, the issuance by the Internal Revenue
Service of proposed or final determinations of taxability,
Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax
status of the Bonds, or other material events affecting the tax
status of the Bonds;
• Modifications to the rights of Bondholders, if material;
• Bond calls, if material, and tender offers;
• Defeasances;
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Limited Tax General Obligation Refunding Bonds, 2014
• Release, substitution, or sale of property securing repayment
of the Bonds, if material;
• Rating changes;
• Bankruptcy, insolvency, receivership or similar event of the
City;
• The consummation of a merger, consolidation, or acquisition
involving the City or the sale of all or substantially all of the
assets of the City, other than in the ordinary course of
business, the entry into a definitive agreement to undertake
such an action or the termination of a definitive agreement
relating to any such actions, other than pursuant to its terms,
if material; and
• Appointment of a successor or additional trustee or the
change of name of a trustee, if material.
The City shall promptly determine whether the events described above are
material.
(d) Format for Filings with the MSRB. All notices, financial
information and operating data required by this undertaking to be
provided to the MSRB must be in an electronic format as prescribed by the
MSRB. All documents provided to the MSRB pursuant to this undertaking
must be accompanied by identifying information as prescribed by the
MSRB.
(e) Notification Upon Failure to Provide Financial Data. The City
agrees to provide or cause to be provided, in a timely manner, to the
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Limited Tax General Obligation Refunding Bonds, 2014
MSRB notice of its failure to provide the annual financial information
described in Subsection (b) above on or prior to the date set forth in
Subsection (b) above.
(f) Termination/Modification. The City's obligations to provide
annual financial information and notices of certain listed events shall
terminate upon the legal defeasance, prior redemption or payment in full
of all of the Bonds. Any provision of this section shall be null and void if
the City (1) obtains an opinion of nationally recognized bond counsel to
the effect that the portion of the Rule that requires that provision is
invalid, has been repealed retroactively or otherwise does not apply to the
Bonds and (2) notifies the MSRB of such opinion and the cancellation of
this section.
The City may amend this section with an opinion of nationally
recognized bond counsel in accordance with the Rule. In the event of any
amendment of this section, the City shall describe such amendment in the
next annual report, and shall include a narrative explanation of the reason
for the amendment and its impact on the type (or in the case of a change
of accounting principles, on the presentation) of financial information or
operating data being presented by the City. In addition, if the amendment
relates to the accounting principles to be followed in preparing financial
statements, (A) notice of such change shall be given in the same manner
as for a listed event under Subsection (c), and (B) the annual report for
the year in which the change is made shall present a comparison (in
narrative form and also, if feasible, in quantitative form) between the
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Limited Tax General Obligation Refunding Bonds, 2014
financial statements as prepared on the basis of the new accounting
principles and those prepared on the basis of the former accounting
principles.
(g) Bond Owner's Remedies Under This Section. The right of any
bondowner or Beneficial Owner of Bonds to enforce the provisions of this
section shall be limited to a right to obtain specific enforcement of the
City's obligations under this section, and any failure by the City to comply
with the provisions of this undertaking shall not be an event of default
with respect to the Bonds.
(h) No Default. Except as otherwise disclosed in the City's official
statement relating to the Bonds, the City is not and has not been in
default in the performance of its obligations of any prior undertaking for
ongoing disclosure with respect to its obligations.
SECTION 13. - Lost, Stolen or Destroyed Bonds. In case any
Bond or Bonds shall be lost, stolen or destroyed, the Bond Registrar may
execute and deliver a new Bond or Bonds of like date, number and tenor
to the Registered Owner thereof upon the Registered Owner's paying the
expenses and charges of the City and the Bond Registrar in connection
therewith and upon his/her filing with the City evidence satisfactory to the
City that such Bond was actually lost, stolen or destroyed and of his/her
ownership thereof, and upon furnishing the City and/or the Bond Registrar
with indemnity satisfactory to the City and the Bond Registrar.
SECTION 14. - Severability; Ratification. If any one or more of
the covenants or agreements provided in this ordinance to be performed
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Limited Tax General Obligation Refunding Bonds, 2014
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 deemed
separable from the remaining covenants and agreements of this ordinance
and shall in no way affect the validity of the other provisions of this
ordinance or of the Bonds. All acts taken pursuant to the authority
granted in this ordinance but prior to its effective date are hereby ratified
and confirmed.
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Limited Tax General Obligation Refunding Bonds, 2014
SECTION 15. - Effective Date of Ordinance. This ordinance shall
take effect and be in force five days after its passage, approval, and
publication as provided by law.
Adopted by the City Council of the City of Kent, Washington, at a
regular meeting thereof held this 4th of February, 2014.
By
Suzette Cooke, Mayor
ATTEST
Ronald F. Moore, MMC, City
Clerk
APPROVED AS TO FORM:
PACIFICA LAW GROUP LLP
Bond Counsel
PASSED: of February, 2014
APPROVED: of February, 2014
PUBLISHED: of February, 2014
-40-
Limited Tax General Obligation Refunding Bonds, 2014
CERTIFICATION
I, the undersigned, City Clerk of the City of Kent, Washington (the
"City"), hereby certify as follows:
1. The attached copy of Ordinance No. (the
"Ordinance") is a full, true and correct copy of an ordinance duly passed at
a regular meeting of the City Council of the City held at the regular time
and meeting place thereof on February 4, 2014, as that ordinance appears
on the minute book of the City; and the Ordinance will be in full force and
effect after its passage; and
2. A quorum of the members of the City Council was present
throughout the meeting and a majority of those members present voted in
the proper manner for the passage of the Ordinance.
IN WITNESS WHEREOF, I have hereunto set my hand this 4th day
of February, 2014.
CITY OF KENT, WASHINGTON
Ronald F. Moore, MMC, City Clerk
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KENT
Agenda Item: Consent — 7F
TO: City Council
DATE: February 4, 2014
SUBJECT: Budget Certification for Annexation Sales Tax Credit Resolution — Adopt
MOTION: Move to adopt Resolution No. , approving the certification
of $4,230,777 for the Panther Lake annexation sales tax credit for the
period July 1, 2014 through June 30, 2015.
SUMMARY: The City is required to certify to the state of Washington before March Vt
of each year, the amount needed from the annexation sales tax credit to provide
services in the annexed area. The Finance Department has calculated the costs and
revenues within the Panther Lake annexation area and has determined a gap between
revenues generated and expenditures used to provide services of $4,230,777 for July
1, 2014 through June 30, 2015.
EXHIBITS: Resolution
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: The budget for the Panther Lake annexation area for the State's
fiscal year 2013 is anticipated to be $11,949,899 in expenditures to provide City
services to those residents, while we anticipate revenues of $7,719,122 from property
taxes, sales taxes and other sources. The net of the revenues and costs produces a
deficit of $4,230,777 which is the amount being certified as the amount of annexation
sales tax credit we are requesting from the State.
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RESOLUTION NO.
A RESOLUTION of the City Council of the
City of Kent, Washington, determining a new
threshold amount for the sales and use tax
authorized by RCW 82.14.415 and codified in
Chapter 3.27 of the Kent City Code, relating to the
cost of providing municipal services to the Panther
Lake Annexation Area for the 2014 fiscal year, and
authorizing the Finance Director to certify the
threshold amount to the Washington State
Department of Revenue.
RECITALS
A. RCW 82.14.415 authorizes the City to impose a sales and use
tax as a credit against state retail sales and use taxes collected under
Chapters 82.08 and 82.12 RCW to assist the City in providing municipal
services to newly annexed areas.
B. After providing all appropriate notice and following appropriate
procedure, and following a favorable vote on the annexation proposition,
the Kent City Council adopted Ordinance No. 3936 on December 8, 2009,
approving the Panther Lake Annexation Area effective July 1, 2010. The
population within the annexation area determined at the time of
annexation was 25,458 people.
1 Tax Credit Threshold
Panther Lake Annexation
C. On February 16, 2010, the City Council passed Ordinance No.
3947, creating Chapter 3.27 of the Kent City Code and imposing the sales
and use tax at the rate of 0.2 percent.
D. On February 15, 2011, the City Council adopted Resolution
No. 1839 confirming the tax rate at 0.2 percent and authorizing the finance
director to certify the threshold amount for the 2011 fiscal year.
E. On February 7, 2012, through Resolution No. 1853, the City
Council adopted a new threshold amount for the 2012 fiscal year and
authorized the finance director to certify the same.
F. On February 19, 2013, through Resolution No. 1871, the City
Council adopted a new threshold amount for the 2013 fiscal year and
authorized the finance director to certify the same.
G. With this Resolution, the City authorizes the imposition of
similar annexation sales and use taxes for the 2014 fiscal year.
H. The City Council of the city of Kent, Washington, finds and
determines that the projected cost to provide municipal services to the
Panther Lake Annexation Area for the 2014 fiscal year will be at least
$11,949,899, and that this cost exceeds the projected general revenue
that the City would otherwise receive from the annexation during the 2014
fiscal year, which is estimated to be $7,719,122.
I. Pursuant to RCW 82.14.415, the city of Kent is authorized,
under the circumstances of this annexation, to impose a sales and use tax
for the 2014 fiscal year, which shall be collected by the State department
of revenue from those persons who are taxable by the state under
2 Tax Credit Threshold
Panther Lake Annexation
Chapters 82.08 and 82.12 RCW, upon the occurrence of any taxable event
within the City.
J. The rate of tax imposed shall be 0.2 percent, and shall be in
addition to other taxes authorized by law, and the threshold amount for the
2014 fiscal year is $4,230,777.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON, DOES HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Rate and Threshold Amount. The Kent City Council
determines that the threshold amount for the City's projected net cost in
providing municipal services to the Panther Lake Annexation Area for the
2014 fiscal year is $4,230,777. The City Council previously imposed a sales
and use tax at the rate of 0.2 percent, with the passage of Ordinance No.
3947 on February 16, 2010.
SECTION 2, - Implementation and certification. The Mayor of the
city of Kent is authorized to implement administrative procedures as may
be necessary to carry out the provisions of this resolution. The City's
Finance Director is authorized to certify the amount for the 2014 fiscal year
to the appropriate agencies within the State of Washington.
SECTION 3, - Severability. If any section, subsection, paragraph,
sentence, clause or phrase of this resolution is declared unconstitutional or
invalid for any reason, such decision shall not affect the validity of the
remaining portions of this resolution.
3 Tax Credit Threshold
Panther Lake Annexation
SECTION 4, - Savings. Resolution No. 1871 shall remain in full
force and effect until the effective date of this resolution.
SECTIONS. - Ratification. Any act consistent with the authority
and prior to the effective date of this resolution is hereby ratified and
affirmed.
SECTION 6, - Corrections by City Clerk or Code Reviser. Upon
approval of the City Attorney, the City Clerk and the code reviser are
authorized to make necessary corrections to this resolution, including the
correction of clerical errors; references to other local, state or federal laws,
codes, rules, or regulations; or resolution numbering and
section/subsection numbering.
SECTION 7, - Effective Date. This resolution shall take effect and
be in force immediately upon its passage, however the imposition of the
sales and use taxes for the 2014 state fiscal year authorized by this
resolution shall not take effect until the commencement of that fiscal year.
PASSED at a regular open public meeting by the City Council of the
city of Kent, Washington, this day of 2014.
CONCURRED in by the Mayor of the city of Kent this day of
2014.
SUZETTE COOKE, MAYOR
4 Tax Credit Threshold
Panther Lake Annexation
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR "PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the City Council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK
P:\Civil\I solution\Mnexadon Sales Tax Threshold2014.docx
5 Tax Credit Threshold
Panther Lake Annexation
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KENT
Agenda Item: Consent - 7G
TO: City Council
DATE: February 4, 2014
SUBJECT: Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. - Authorize
MOTION: Authorize the Mayor to sign a contract with Petersen Brothers
Construction, Inc. to perform emergency repairs of damaged guardrails on
an as needed basis in an amount not to exceed $20,000, subject to final
terms and conditions acceptable to the City Attorney and Public Works
Director.
SUMMARY: The city typically has several guardrails that are damaged or destroyed
each year by vehicles due to severe weather or inattentive drivers. In the past we
have spent time soliciting bids for each repair. Petersen Brothers is the only business
that consistently responds and at this time is the sole provider for this service in the
region.
We are requesting the approval of this contract to be able to expedite repairs.
EXHIBITS: None
RECOMMENDED BY: Public Works Committee
YEA: Berrios - Ralph - Higgins NAY:
BUDGET IMPACTS: Funds would be made available by Council through the use of
Business and Occupation Tax.
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KENT
Agenda Item: Consent - 7H
TO: City Council
DATE: February 4, 2014
SUBJECT: 2013 Crack Sealing Project Completion - Accept
MOTION: Accept the 2012 Crack Sealing Project as complete and release
retainage to C.R. Contracting, upon receipt of standard releases from the
state and the release of any liens.
SUMMARY: Crack sealing is a maintenance treatment used to prevent water from
infiltrating cracks in a roadway. When water infiltrates cracks, it leads to accelerated
damage of the roadway. Historically, Public Works Operations crews have performed
crack sealing. Our crews still perform a significant amount of crack sealing work
annually; however, the volume of work has exceeded the time available for in-house
personnel. Therefore, several roadways in the valley were identified to have crack
sealing performed by a Contractor. The original contract amount was $195,300.00.
The final contract amount was $194,194.70.
The project consisted of installing approximately 18 tons of rubberized asphalt for
crack sealing on Central Avenue South, West Valley Highway, 84th Avenue South, 64th
Avenue South, Meeker Street and several industrial streets in the northwest corner of
the city.
The contract is now complete and ready for Council acceptance.
EXHIBITS: None
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS: This project was funded from the Business & Occupation tax
revenue.
This item did not need to be brought to Committee.
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KENT
Agenda Item: Consent - 7I
TO: City Council
DATE: February 4, 2014
SUBJECT: Oakleigh I & II Bill of Sale- Accept
MOTION: Accept the Bill of Sale for the Oakleigh I & II project, permit
2071420, for 28 gate valves, 5 hydrants, and 3,816 linear feet of waterline;
17 sanitary sewer manholes, and 2,747 linear feet of sanitary sewerline;
384 linear feet of new curb and gutter, 272 linear feet of new sidewalk, 2
street lights, and 6 street trees; 1 storm sewer catch basin, and 320 linear
feet of storm sewerline.
SUMMARY: The Oakleigh I & II project is located at 27919 106th Ave. SE; parcel
#3222059089.
EXHIBITS: Oakleigh I & II Bill of Sale
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS:
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MAIL TO:
CITY OF KENT
ENGINEERING DEPARTMENT
ATTN: Ozzie Carrasquilla
�Aj 220 — 4T" AVENUE SOUTH
WASH IN a T O a KENT, WASHINGTON 98032
Project: Oakleigh I & II
CITY OF KFNT Permit #:_RECC-2071420
JUN Q 5 201.E Location: 108" Avenue SE at SE 279th Street
ENGINEERING UEP I Parcel #: 322205-9094. -9089. -9095, -9122, -9137
BILL OF SALE
CITY OF KENT
KING COUNTY, WASHINGTON
THIS INSTRUMENT made this 12th day of April 2013, by and between Henley USA LLC, hereinafter
called "Grantors", and City of Kent, a municipal corporation of King County, State of Washington, hereinafter
called
"Grantee":
WITNESSETH:
That the said Grantors for a valuable consideration does hereby grant, bargain, sell to Grantee the following
described improvements:
A. WATERMAINS:
Together with a total of 28 gate valves at $800.00 each, 5 hydrants at $4,200 each and/or any other
appurtenances thereto.
ON FROM TO
SE 2Both Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
1071h Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 3,816 linear feet at $42.00 per LF of 8" D.I. waterline, and
300 linear feet at $50.00 per LF of 12" D.I. waterline.
Bill of Sale 14369.036.doc
1of5
B. SANITARY SEWERS:
Together with a total of 17 manholes at $3,200.00 each and/or any other appurtenances thereto.
ON FROM TO
SE 2801h Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
107" Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 2,747 linear feet at $38.00 per LF of 8" PVC sewerline, and
611 linear feet at $50.00 per LF of 12" PVC sewerline.
C. FRONTAGEIMPROVEMENTS:
Together with lights, trees, landscaping (except residential streets) and/or any other appurtenances
ON FROM M
1081h Avenue SE SE 279th Street SE 278t" Street
Including 384 linear feet at $8.00 per LF of concrete curb and gutter, and
272 linear feet at $12.00 per LF of 6-foot concrete sidewalk, and
2 street lights at $6,500.00 each, and
6 street trees at $300.00 each.
D. STORM SEWERS:
Together with a total of 5 Type I catch basins at $950.00 each, and/or any other appurtenances
thereto.
ON FROM TO
1081h Avenue SE SE 279th Street SE 278th Street
Including 320 linear feet at $28.00 per LF of 12" PVC sewerline.
To have and to hold the same to the said Grantee, its successors and assigns forever.
The undersigned hereby covenants that it is the lawful owner of said property; and that the same is free
from all encumbrances; that all bills for labor and materials have been paid; that it has the right to sell the
same aforesaid; that it will warrant and defend the same against the lawful claims and demand of all
person(s).
The Bill of Sale is given on consideration of the agreement of the Grantee for itself, its successors and
assigns to incorporate said utilities in its utility system and to maintain them as provided in the applicable
City Ordinances. The City accepts the items subject to staff approval and completion of a 2 year
maintenance period.
Bill of Sale 1436e.036.doc
2of5
IN WITNCEESS WHEREOF, the undersigned has caused this instrument to be executed on this
L t day of 2013.
��V v,-..L,'f'\'Jv-- i=`�- L-Li.u1.C�; N'lfi,Vtet.�a• r�:,_�'._.. '..
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed on this
day of 2013,
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this day of 2013, before me, .the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared to me known to be the individual described in and
who executed the foregoing instrument, and acknowledged to me that he/she signed and sealed this
instrument as his/her free and voluntary act and deed for the uses and purposes therein mentioned.
GIVEN under my hand and official seal this day of 2013.
Notary Public in and for the State of
Washington, residing at
My Commission Expires:
Bill of Sale 14369.036.doc
3 of 5
i
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this is day of Y 2013, before me, the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared f�t' t (`--&A1/e-// and to me to be the
PJ �c�P (,.bvo6 4d" d respectively of
FiR/ � dA the�7G�M ;,Ce®/ G>'40,IAX l"rx that executed the foregoing
instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said
Gf-C for the uses and purposes therein mentioned, and on oath stated that
they are authorized to execute the said instrument.
Witness my hand and official seal hereto affix the day and year first above written.
�449bRSGilytrid�,��
�«•�@i,�Qp1NTih�ry,„•.,/Js�se. ,€ll .�' .l.�s�iwr �
:0°4. Notary Public IW and for the ate of
*, 30 w.Z_ Washington, residing at
2014
?BeR AitP16 �0`��`` My Commission Expires:
The Bill of Sale is given and accepted pursuant to a motion duly made, seconded, and passed by the City
Council of the City of Kent, King County, Washington, on the day of
2013.
Bill of Sale 14369.036.doc
4of5
FO
i
WASHINGTON it
ENGINEER'S CERTIFICATION
CITY OF KENT
KING COUNTY, WASHINGTON
The figures used on the Bill of Sale for the Oakleigh I and II project dated April 12,
2013, for the same said Oakleigh I and II project. Chris Jensen, the undersigned
P.E. or land surveyor is the person responsible for the preparation of the Bill of Sale and
is an employee of Barghausen Consulting Engineers, Inc., the firm responsible for
the preparation of the record drawings.
�R1S JEFys�
evA �C
O 4 11111�
Sigr ature
(Engineer stamp required)
Bill of Sale 14369.036.doc
5of5
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KENT
Agenda Item: Other Business — 8A
TO: City Council
DATE: February 4, 2014
SUBJECT: Financial policy Resolution - Adopt
MOTION: Move to adopt Resolution No. , repealing Resolution No.
1859, amending financial policies to be used for guidance when enacting
and amending the city budget.
SUMMARY: This resolution amends the city's financial policies by clarifying the
requirements and available uses for the city's Strategic Opportunities Fund, first, by
confirming that non-recurring revenues only be applied to non-recurring expenses,
and second, by confirming that monies will not be spent out of this fund unless the
council first approves the expenditure.
Additionally, we have added a new, aspirational goal designed to obtain exceptional
financial stability by increasing our total government fund balance to a point where it
should carry the city through future economic downturns.
EXHIBITS: Resolution and Exhibit
RECOMMENDED BY: Operations Committee
YEA: Thomas — Ralph — Boyce (post meeting) NAY:
BUDGET IMPACTS: None
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RESOLUTION NO.
A RESOLUTION of the city council of the
city of Kent, Washington, repealing Resolution
1859 and adopting financial, accounting, and
budgetary policies intended to provide short and
long-term guidance to city staff for the purpose of
achieving financial stability and achieving goals
established in the City Council's Strategic Plan.
RECITALS
A. As the council developed its strategic plan, it also created a new set
of financial, accounting and budgetary policies that are intended to offer
short and long-term guidance to city staff as the city moves toward
accomplishing the goals established in the strategic plan. The council
adopted these financial policies by resolution on June 5, 2012.
B. Since implementing these policies, the council has determined that
certain policies, such as the policy pertaining to the city's "Strategic
Opportunities Fund," need clarification. Further, in order to be best
prepared for future economic downturns, the policies have been amended
to add an aspirational goal of building a solid financial reserve for all city
funds.
C. Just as the strategic plan reflects goals and a vision the city strives
to achieve, these amended policies reflect the financial goals and vision for
the city. Accordingly, the council implements these policies today with the
1 Financial Policies Resolution
understanding that not all goals can be achieved immediately, but rather
will be achieved over time.
THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES
HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Recitals. The foregoing recitals are incorporated by
this reference.
SECTION 2, - Repealer. Resolution No. 1859, adopted on June 5,
2012, is repealed in its entirety.
SECTION 3, - Policies Adopted. The city of Kent Financial Policies
attached as Exhibit A are adopted.
SECTION 4, - Severabilitv. If any one or more section, subsection,
or sentence of this resolution is held to be unconstitutional or invalid, that
decision shall not affect the validity of the remaining portion of this
resolution and that remaining portion shall maintain its full force and
effect.
SECTION S. - Effective Date. This resolution shall take effect and
be in force immediately upon its passage.
PASSED at a regular open public meeting by the city council of the
city of Kent, Washington, this day of 2014.
SUZETTE COOKE, MAYOR
2 Financial Policies Resolution
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR 11PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the city council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK (SEAL)
P:\Civil\Pesolution\financial Policies 2014.docx
3 Financial Policies Resolution
FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves — The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund — The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise. For the
purposes of this section, "investment opportunities" includes expenditures intended to
increase city revenues or decrease operating or capital costs. To the extent the balance in this
fund is not from a recurring revenue source, it should only be utilized for a non-operating
purpose or one time expenditure. In addition, any appropriation from this fund must first be
approved by the City Council. In the event any of this fund is used in an economic downturn to
stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projects or capital projects that reduce
recurring operational expenditures. This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs — The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of $1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its $1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational goal, the City shall maintain a
total governmental fund balance of twice the greatest volatility in year over year changes in
total revenues or $30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
Exhibit A
OPERATING BUDGET POLICIES
City Target Issues-The City Council will update its strategic plan in the early spring of each year. The
staff will use this plan for development of the following year's budget priorities and the next biennial
budget.
Budget Kickoff—The Mayor and City Council shall meet in the Spring of even numbered years to plan
the following biennial budget and agree on the anticipated revenues on which the preliminary budget will
be based. The City Council shall review revenue estimates and preview potential changes to revenues.
The City Council shall then approve the revenue amount that will be used by the Mayor to form the initial
preliminary budget. The Mayor and City Council will meet additionally in late Summer to re-review the
revenue estimates to adjust them more closely to the additional revenue information that has become
available with the passage of time. Any changes resulting from this meeting shall be incorporated into
the preliminary budget to be considered by City Council.
Program Reviews — The Mayor shall perform a periodic review of staff and programs of the City for
both efficiency and effectiveness.Alternate methods of delivery will be evaluated for providing services.
Programs that are determined to be inefficient, ineffective, or inconsistent with the City Council's
strategic goals shall be reduced in scope or eliminated.
Preliminary Budget — The Mayor shall propose a preliminary budget in the Fall of even numbered
years. The preliminary budget will be developed in accordance with the revenues approved by the City
Council at the budget kickoff as amended. If the preliminary budget is based on revenues in excess of
those approved by City Council,the Mayor will present the justification for the increased revenues or the
additional proposed revenue sources.
Structurally Balanced Budget—The Mayor shall present, and the City Council shall adopt a budget in
which ongoing revenues equal or exceed ongoing expenditures. One time revenues shall not be used
to pay for recurring expenditures.
Conservative Expenditure Budgeting-The City will maintain its conservative expenditure budgeting
with respect to budgeting existing full time positions for a full year.
Acceptance of Grants —The City shall review any requirements for ongoing costs from any grant for
operational purposes. Any requirement to fund any portion of the costs as a condition of receipt of the
grant shall be a consideration in the decision to accept or reject the grant.
Self Supporting Proprietary Funds-The City's water, sewer and golf course enterprise funds will be
self supporting along with its internal service funds. The cost of providing services is expected to be
fully funded from charges for the service. If the funds produce a loss, rates will be adjusted to achieve,
at minimum, a break even status. If debt has been issued which requires a certain level of return, rates
and charges will be adjusted to achieve those returns.
Health Insurance Reserves — The target reserve for the Health Insurance Fund shall be two times
IBNR.
Full Cost of Service — The City will define its basic services to our residents. The services will be
evaluated as to their full cost. This information will be incorporated and presented as a section of the
annual budget.
Exhibit A
REVENUE AND COLLECTIONS
Aggressive Collection Effort- The City will follow an aggressive policy of collecting all monies due the
City to the extent that the collection efforts remain cost effective.
Reimbursements on a timely basis—Many grants occur on a cost reimbursement basis. To maximize
the City's available investable funds, reimbursement should be pursued on a timely basis.
User Charges Related to Costs - The City will review fees and charges on an annual basis and will
modify charges to adequately keep pace with increasing costs of providing services.
User Charges and Taxes Related to Market Rates- The City will consider its user charges and its tax
rates in connection with those of comparable sized communities and similar service providers, so that it
will provide reasonable rates to maintain its advantage in the market place in attracting businesses and
residences to the City of Kent.
CAPITAL BUDGETING
Committed Special Revenue Funds - The City will maintain its practice of designating its street and
capital improvement revenue sources including a percentage of its sales tax collections for the funding of
its capital improvement program.
Capital Improvement Program - The City will update its capital facilities plan on an annual basis as
required by the Growth Management Act. A preliminary plan will be established early in the budgeting
process to serve as a guideline during the year,with a final amendment adopted with the adoption of the
operating budgets to reflect the necessary changes in the City's Comprehensive Plan.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should issue
debt only for major capital projects. Debt should only be authorized for projects where the life of the
asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments on
outstanding debt shall be the highest priority before payment for other capital expenditures.
Bond Rating-The Citywill continue to strive to improve its bond rating by improving its financial stability.
Debt Capacity - The City strives to maintain adequate available debt capacity for large top priority
projects.
Bonding Limitations— Direct General Obligation Debt will not exceed 1.5% of assessed value; direct
and indirect debt will not exceed 4% of assessed value; duration of the debt will not exceed 15 years.
Revenue Debt Covenants—Will be based on the volatility of the revenues.
Arbitrage regulations—Will be strictly followed.
Special Assessment Guaranty Fund-The City will strive to maintain adequate reserves for retirement
of special assessment debt through the maintenance of a special assessment guaranty fund at least 10%
of outstanding special assessment debt.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost effective to
both the borrowing and the lending fund, and the funds will not be needed by the loaning fund during the
term of the loan. Such borrowing shall implement Council directed policy in a simplified manner, such as
borrowing associated with interim financing for local improvement district projects. A repayment plan
Exhibit A
should be approved along with the loan. The Mayor may approve loans for a term of one year. The
Council must approve loans with terms longer than one year.
INVESTMENT POLICY
Investment Security&Earnings Maximization-An investment policy was implemented per Ordinance
#3278 in 1996 which detail the City's investment guidelines. The primary objective is to preserve the
principal of the investment portfolio while maximizing the portfolio's return.
FINANCIAL REPORTING
Reporting frequency — Monthly budget and actual reports will be available to departments and a
quarterly report will be presented to the City Council Operations Committee.
Annual Report—Will be completed within 180 days.
Reporting Improvements-The City will strive to continue to make improvements in its financial reporting
scheme so that information available to the public,the City's governing bodies and other city departments
is timely and the best available for sound financial decisions.
Bondholders'Report— The City will prepare an annual report to bondholders.
Full Disclosure—All public reports will contain full and complete disclosure of all material matters.
Financial Trend Monitoring - The City will develop a program to evaluate its financial condition and
establish a system for correcting any deficiencies noted.
Annual Audits - The City will assist the State Auditor's Office in whatever way possible in conjunction
with the preparation of the annual audit,and will implement modifications identified bythe State Auditorto
improve the City's internal control and financial practices.
Updates to these Policies—The Operations Committee of the City Council shall review these policies at
least every four years. It is recommended that the review is done biennially during the budget process.
Exhibit A
ACCOUNTING
Generally Accepted Accounting Principles-The City will maintain its position as a leader in producing
financial reports in conformance with generally accepted accounting principles and pronouncements by
the Governmental Accounting Standards Board.
Basis of Accounting - The basis for accounting for the general fund, special revenue, debt service,
capital projects and agency funds is modified accrual. Modified accrual recognizes revenues when they
become both measurable and available to finance expenditures of the current period. The basis of
accounting forthe enterprise, internal service funds and pension trustfund is full accrual. The appropriate
basis is used throughout the budgeting, accounting and reporting processes, with few exceptions as
noted below. Full accrual is a method of accounting that matches revenues and expenses with the period
to which they relate, rather than focusing on actual cash flows. In this method, for example, an asset is
depreciated as it is "used up", and the expense is recognized in periodic increments, rather than
assuming the asset holds its value until it is actually disposed of. However, since the focus in budgeting
is on the revenues and expendable accounts, depreciation and amortization are not considered budgetary
accounts, and are excluded from the budgeting system. Likewise, debt service and capital expenditures
are presented as the payments occur, departing from GAAP in this regard, in the budget document. Also,
Trust and Agency Funds that may not be expended for governmental operations are excluded from this
budget document.
The presentation of the program budget departs from the basis of the legal budget by eliminating inter city
transactions and allocating the net increases or decreases from internal services to the using programs.
This is done to give the user a more complete picture of the total costs of the operating programs.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
The City of Kent, as all governmental units, operates its budget and accounting system based on a fund
structure. Funds are established to segregate specific revenue to ensure their expenditure within
applicable legal and contractual provisions. Revenues are allocated to and accounted for in individual
funds based on the purposes for which they are to be spent and the means by which the spending
activities are to be controlled. The City of Kent operates with seven basic fund types. Within each fund
type there may exist one or more individual funds. The City of Kent operates with 26 individual funds.
The fund types are listed below under their three major subheadings.
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
GOVERNMENTAL FUNDS
General Fund
The General Fund is the principal operating The General Fund "buys" services from the
fund of the City. It accounts for the financial Internal Service Funds: fuel and rental of
resources of the City which are not accounted vehicles from the Equipment Rental Fund;
for in any other fund. Principal sources of supplies, postage, photocopy, printing and
revenue are property taxes, sales and use graphics, cable TV services, data processing
taxes, utility taxes, licenses and permits, state and telephone services from Central Services;
shared revenues, charges for services and facility maintenance and operation services
interest income. Primary expenditures are for from Facilities; and insurance from the
general City administration, police and fire Insurance Fund. Costs are allocated to all
protection, engineering and planning services, funds in an effort to distribute accounting,
park and street maintenance, and cultural and budgeting, legal and human resource services
recreational services. as well as street, engineering and park
services. General Fund also transfers funds for
minor projects.
Special Revenue Funds
Special Revenue Funds are used to account for Taxes and grants are collected in the Street
specific revenue sources that would otherwise Fund, LEOFF1 Retirees Fund, Lodging Tax
be accounted for in the General Fund, but for Fund, Youth Teen Programs Fund, Capital
which there exists certain legal restrictions as to Improvement Fund, Criminal Justice Fund,
the use of certain revenues. The revenue is Community Development Block Grant Fund,
segregated into individual special revenue funds Other Operating Projects Fund, and the Kent
to ensure expenditure for a designated purpose. Events Center Operating Fund. Transfers from
Principal sources of revenue are: state shared the Street and Capital Improvement Funds are
fuel tax, earmarked sales and utility taxes and primarily to the Capital Project Funds or the
community development block grant funds. The LTGO Debt Service Fund.
major portion of these resources are transferred
to other funds for debt retirement, capital
acquisition and specific purposes operations.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Debt Service Funds
Debt Service Funds are used to account for the The Debt Service Funds receive the transfers
accumulation of resources to be used for the from the Special Revenue Funds, Water Fund
retirement of general long-term debt. The City and Sewerage Funds to pay principal and
has three types of general long-term debt for interest on LTGO debt issues.
which resources are accumulated: general
obligation long-term debt (voted, general
obligation long-term debt and LTGO)and special
assessment debt. Sources of revenue to fund
the retirement of general obligation long-term
debt are property taxes and transfers in from
other funds. Special assessments are levied
and received to retire special assessment debt.
Capital Projects Funds
Capital Projects Funds are used to account for Transfers are received from Special Revenue
the financing of major one time only capital and other funds as a partial source of funds
projects other than those financed by Proprietary needed to complete projects.
Funds. Sources of revenue are: proceeds of
debt issuance, grants, and transfers from other
funds.
PROPRIETARY FUNDS
Enterprise Funds
Enterprise Funds are used to account for the The Enterprise Funds "buy" services from the
financing of services provided to the general Equipment Rental Fund for equipment rental and
public where all or most of the costs involved are fuel; from the Insurance Fund for insurance
paid for by user charges. Operations financed needs; from the Central Service Funds for
as enterprise funds are operated in a manner stores, telephone, postage, photocopying,
similar to private business enterprises. Kent's printing and graphics, cable TV services, data
enterprise funds are funded through water, processing and telecommunications; and from
sewer, and drainage utility charges and the Facilities Fund for facility maintenance and
recreational charges at the City's golf complex. operation services. The Enterprise Funds also
reimburse the General Fund for cost allocations
for budgeting,accounting, human resource, legal
and engineering costs which relate to Enterprise
Funds. Other funds purchase utilities at the
same rate as the general public.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Internal Service Funds
Internal Service Funds are used to account for Centralizes costs for equipment rental, central
the financing of specific services performed by services and insurance. These services are
designated organizations within the City for "sold" to other funds at cost plus a reserve for
other organizations within the City. The City's future needs.
Equipment Rental, Central Service, Facilities
Maintenance and Planning, and Insurance
Funds provide centrally administered services
then generate revenue by billing the
organization to which the service is provided.
FIDUCIARY FUND TYPES
Trust and Agency Funds
Trust and Agency Funds are used to account
for assets held by the City as trustee or agent
for individuals, private organizations or other
governmental units. Since their funds are not
expendable for City operations they are not
included in the budget. However, per state
auditor requirements, estimates are provided
for their activities.
Exhibit A
BUDGET AND SPENDING CONTROL SYSTEM
Budgets serve as control mechanisms in the operations of governmental units. Legal budgetary
(expenditure) control in the City of Kent is maintained at the fund level. Administration can amend
budgets, with no overall dollar increase between departments, within a fund. Supplemental
appropriations that amend total expenditures, or in the case of Proprietary Funds amend working
capital, require a City Council ordinance. All operating budgets lapse at the end of the biennium.
Within each year of the biennium, a single year allocation will be adopted and operate as if it were
an annual budget.
General and Special Revenue Funds control expenditures with a legal biennial budget at the fund
level. Debt Service Funds operate under the control of the bond indentures which established
them. Capital Projects Funds operate under the control of total project authorization, rather than the
annual budget. Proprietary Funds control expenditures with a flexible budget whereby the
expenditure increases must be offset by increased resources. Though budgetary control is at the
fund level, budget and actual information is maintained by project, organization, program and
object. Both budget and actual information is presented on a GAAP basis of accounting, when
presented by fund.
The City must adopt its biennial budget by December of the preceding fiscal year. This usually
follows six months of analysis by staff and City Council. The first step involves the establishment of
the baseline revenue budget by the City Council. The second step is to review the City Council
Strategic Goals and begin budget development to assist in achieving those goals.Third, undertake
a program review to ensure that current program offerings are in agreement with City Council goals
and priorities. The emphasis is placed on the General and Special Revenue Funds since the
operation of other funds are tied to ordinances, contractual agreements or separately established
rate structures. Once the baseline operations have been reviewed and adjusted based on
administrative policy, program expansion is included to the level of projected available resources
after the establishment of sufficient fund balances.
A mid-biennium review is undertaken during the second year of the biennium in which any changes
to the initial estimates of revenues and expenditures are to be reviewed. Such changes will be
presented by the Mayor and discussed by the City Council. Any agreed upon changes shall be
approved with an ordinance adopting changes to the biennial budget.
After the preliminary budget document is prepared, the City Council spends approximately one
month reviewing it. Public meetings are held to gather public input. When the budget review and
final adjustment period is complete a balanced budget as required by state law is adopted by
ordinance. After adoption, periodic budget adjustments that affect total fund expenditures are made
as approved by City Council, but a final budget adjustment ordinance covering all approved
changes is adopted at year end or the beginning of the next biennium.
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FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves—The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund —The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise ..
AsTo the extent ,
this fund _"a" GAIY be 61t I Zed
Lhen
the
first a roved b City Council. In the event any of this funds used inlanfeco omit dovvnt is
pp y y y wnturn
to stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projectsr
This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs—The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of$1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its$1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational coal, the City shall maintain a� Formatted:Font:Bold
total governmental fund balance of twice the greatest volatility in year over year changes in Formatted:Indent:Left: 0.12"
total revenues or$30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds—The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service—To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
BIDS
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REPORTS FROM STAFF, COUNCIL COMMITTEES, AND SPECIAL COMMITTEES
A. Council President
B. Mayor
C. Administration
D. Economic & Community Development
E. Operations
F. Parks & Human Services
G. Public Safety
H. Public Works
I. Regional Fire Authority
J. Other
K. Other
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EXECUTIVE SESSION
ACTION AFTER EXECUTIVE SESSION
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CITY OF KENT
City Council Meeting
Agenda
I�� mt U r rt
r
m
February 4, 2014
Mayor Suzette Cooke
Darla Ralph, Council President
Couneilr embers
Jim Berrios
Bill Boyce
Dennis Higgins
Deborah Ranniger
Les Thomas s
we
CIFY CLERK
y �
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KENT CITY COUNCIL AGENDAS
KENT February 4, 2014
w s v ro Council Chambers
Mayor Suzette Cooke
Council President Dana Ralph
Councilmember Jim Berrios Councilmember Bill Boyce
Councilmember Dennis Higgins Councilmember Deborah Ranniger
Councilmember Les Thomas
*********************************************************************
SPECIAL COUNCIL WORKSHOP AGENDA
5:00 P.M.
Subiect Speaker Time
2014 Top Departmental Issues Tom Brubaker 90 min
COUNCIL MEETING AGENDA
7:00 p.m.
1. CALL TO ORDER/FLAG SALUTE
2. ROLL CALL
3. CHANGES TO AGENDA
A. FROM COUNCIL, ADMINISTRATION, OR STAFF
B. FROM THE PUBLIC — Citizens may request that an item be added
to the agenda at this time. Please stand or raise your hand to
be recognized by the Mayor.
4. PUBLIC COMMUNICATIONS
A. Public Recognition
B. Community Events
C. Introduction of new Arts Commission Appointee, Lynn Bohart
D. Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E. Intergovernmental Reports
5. PUBLIC HEARINGS
6. PUBLIC COMMENT
7. CONSENT CALENDAR
A. Minutes of Previous Meetings and Workshop — Approve
B. Payment of Bills — Approve
C. Appointment to Arts Commission — Confirm
D. Appointments to Land Use and Planning Board - Confirm
(Continued)
COUNCIL MEETING AGENDA CONTINUED
E. Refunding 2004 Limited Tax General Obligation Bond Ordinance —
Adopt
F. Budget Certification for Annexation Sales Tax Credit Resolution —
Adopt
G. Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. — Authorize
H. 2013 Crack Sealing Project Completion — Accept
I. Oakleigh I & II Bill of Sale- Accept
8. OTHER BUSINESS
A. Financial policy Resolution - Adopt
9. BIDS
10. REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
11. EXECUTIVE SESSION AND ACTION AFTER EXECUTIVE SESSION
12. ADJOURNMENT
NOTE: A copy of the full agenda packet is available for perusal in the City Clerk's
Office. The Agenda Summary page and complete packet are on the City of
Kent web site at www.KentWa.gov
An explanation of the agenda format is given on the back of this page.
Any person requiring a disability accommodation should contact the City Clerk's Office
in advance at (253) 856-5725. For TDD relay service call the Washington
Telecommunications Relay Service at 1-800-833-6388.
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CHANGES TO THE AGENDA
Citizens wishing to address the Council will, at this time, make known the
subject of interest, so all may be properly heard.
A) From Council, Administration, or Staff
B) From the Public
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PUBLIC COMMUNICATIONS
A) Public Recognition
B) Community Events
C) Introduction of new Arts Commission Appointee, Lynn Bohart
D) Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E) Intergovernmental Reports
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PUBLIC HEARING
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PUBLIC COMMENT
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Agenda Item: Consent Calendar 7A - 7B
CONSENT CALENDAR
7. City Council Action:
Councilmember moves, Councilmember
seconds to approve Consent Calendar Items A through E.
Discussion
Action
7A. Approval of Minutes.
Approval of the minutes of the workshop and regular Council meeting of
December 10, 2013.
7B. Approval of Bills.
Approval of payment of the bills received through November 30 and paid on
November 30 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
11/30/13 Wire Transfers 5684-5694 $1,148,142.13
11/30/13 Regular Checks 678482-678852 $3,165,660.16
Void Checks ($104.90)
11/30/13 Use Tax Payable $1 290.72
$4,314,988.11
Approval of payment of the bills received through December 15 and paid on
December 15 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/15/13 Wire Transfers 5695-5714 $2,044,626.90
12/15/13 Regular Checks 678853-679223 $2,045,487.95
Void Checks ($0.00)
12/15/13 Use Tax Payable $1 414.29
$4,091,529.14
Approval of payment of the bills received through December 31 and paid on
December 31 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/31/13 Wire Transfers 5715-5727 $1,375,632.00
12/31/13 Regular Checks 679224-679539 $3,099,891.45
Void Checks ($675.00)
12/31/13 Use Tax Payable $162.74
$4,475,011.19
Approval of checks issued for payroll for November 16 through November 30 and
paid on December 5, 2013:
Date Check Numbers Amount
12/5/2013 Checks 333708-333824 $ 91,543.70
Voids and Reissues
12/5/2013 Advices 322206-322830 1,569,071.57
$1,660,615.27
Approval of checks issued for payroll for December 1 through December 15 and
paid on December 20, 2013:
Date Check Numbers Amount
12/20/2013 Checks 333825-333949 $ 77,667.53
Voids and Reissues
12/20/2013 Advices 322831-323460 1,299,170.40
$1,376,837.93
Approval of checks issued for payroll for December 16 through December 31 and
paid on January 3, 2014:
Date Check Numbers Amount
1/3/2014 Checks 333950-334083 $ 66,870.91
Voids and Reissues
1/3/2014 Advices 323461-324081 1,251,884.88
$1,318,755.79
11 � KENT
Kent City Council Workshop
January 21, 2014
The meeting was called to order at 5:30 p.m. by Council President Ralph.
Councilmembers present: Ralph, Berrios, Higgins, Ranniger, and Thomas
Council President Ralph discussed the application process for the Council vacancy. She
highlighted how to apply and verified that the Council would review applications at a
special meeting on February 11, 2014 at 6:00 p.m.
Council Retreat Dates — Council President Ralph communicated that the Council
Retreat would be March 21 and 22 at the Green River Community College.
Councilmember Ranniger suggested an email be sent to Councilmembers.
IS 402 Training - Dominic Marzano, Emergency Management Director discussed IS-
402. He communicated that it is a class for executives and senior officials (policy
makers) and trains them how to better manage events and make policy decisions. He
noted that best practices will also be communicated in the class. He noted that the
class is for South King County officials and urged Council participation in the class. He
also communicated that he will be speaking to MLT next Monday concerning a class
for them because of some new equipment in the emergency communication center
(ECC).
Councilmember Higgins verified that the training is February 12 from 6:00 p.m. to
8:00 p.m.
Marzano also suggested that the Mayor bring the Acting City Attorney to the class to
go over policy decisions.
Council President Ralph communicated that she felt this would be a good opportunity
for the Council. She said there is a lot involved and this is a detailed process. She
noted that at the South County Area Transportation Board meeting there was a
discussion about what cities have set up in case of an oil spill because of the increase
of oil tanker ships in the Puget Sound. Marzano confirmed that the City does have a
plan set up.
B&O Tax Amendments — Robert Nachlinger, Finance Director discussed the
preliminary amendments to the B&O tax ordinance. He communicated that it was
adopted a little over a year ago and the City has received about three quarters of the
projected revenues. He noted that there is an inconsistency between local codes and
that has caused confusion to firms who have to file B&O in numerous cities. He
reviewed Bellevue, Seattle, and Tacoma's exemptions and said staff proposes to
exempt all 501(c) organizations to include homeowner associations, unions, fraternal
organizations, and others who are not engaging in retail activities.
Councilmember Higgins verified that there are a couple of organizations that are
501(c) status that engage in retail sales such as Goodwill and Children's Hospital.
Kent City Council Workshop Minutes January 21, 2014
Councilmember Ranniger inquired about the financial impact and Nachlinger replied
that it would be about $25,000 per year.
Nachlinger continued and discussed filing status and frequency. He noted that having
all firms file quarterly this first year has provided the City with data. Almost 1,600
firms have paid and 36 percent of them (576) have paid over $1,000 quarterly and
this, he noted makes up 92 percent of the total tax revenues collected. He continued
and said 64 percent have paid less than $1,000 and less than 8 percent of the total
revenues collected. He suggested that the firms who have paid less than $1,000 be
reverted to annual collections based on these numbers.
Discussion continued on how they would be reverted to annual collections and
Nachlinger communicated that the Finance Department could send them a letter
communicating this. He also stated that the staff did not recommend having a "non-
filing status" so the City could continue to maintain information concerning
businesses.
Councilmember Higgins verified that only Bellevue and Tacoma have a non-filing
option and Nachlinger communicated their amounts.
Councilmember Higgins discussed the administrative expenditures concerning the
B&O tax.
Councilmember Berrios verified the department was down an auditor. He also
confirmed with Nachlinger that they haven't gotten the data concerning most of the
seasonal firms. However, the data should come in February or March.
Council President Ralph verified with Brubaker that an ordinance would be drafted and
brought to Council for adoption.
Council President Ralph stated she is comfortable with this and agreed with the
process of letting businesses know they have been moved to an annual filing status.
Councilmember Thomas suggested the ordinance be retroactive and if they have paid
this past year they have their funds refunded and not penalized. Fitzpatrick
communicated that his staff will look into doing that.
Councilmember Berrios communicated that the process needs to be fair and
accountable. He said the policy needs to be consistent and take into account who paid
and who didn't based on the legislation the Council passed.
Council President Ralph stated that it seems best to stay the course and make
revisions at the end of the year.
Nachlinger stated that there are 145 3PLs and based on the amount of revenues
generated from their B&O tax compared to their square footage tax returns, the
square footage tax amount was 3.5 times their B&O tax amount. He stated that the
B&O is working exactly as it was intended to. He communicated that there is an
argument concerning companies that don't do many deliveries into Kent, but they are
2
Kent City Council Workshop Minutes January 21, 2014
making more money than what is being reported. He stated that the tax is designed
to get some mitigation from companies that destroy the cities roads.
Councilmember Higgins inquired about the federal research and development funds
and Nachlinger communicated that since the City gave an exemption he wasn't sure
how much it was for.
Councilmember Berrios stated that the Chamber discussed that with Boeing and they
didn't know what the number was either.
Council President Ralph verified that they weren't required to report those federal
funds to the City.
Mayor Cooke clarified that the 3PLs aren't seeking an exemption, but a reduced rate
due to the square footage tax compared to their gross revenues that would be with
the B&O tax. She communicated that if the Council decides that they don't want 3PLs
the businesses can easily go to local cities. She recommended the Council look at the
entire picture and realize that the surface isn't equal.
Councilmember Higgins stated these businesses are creating truck traffic so the B&O
tax makes sense. He also added that the other tax seems appropriate, too.
Councilmember Thomas communicated that he would like to remain competetive and
verified with the Mayor that there are ten 3PL companies. Additionally, the Mayor
added that she wasn't sure how much of the product they are storing is from local
businesses.
Councilmember Ranniger stated that there have been challenges with the streamline
sales tax for a while now. She stated the other policy question is whether to rezone
the area to retail. She said that if the City discourages these types of businesses
because of the B&O tax, the City needs to prepare to decide what it wants to see in
those properties.
Council President Ralph questioned if the conversation should be left open or have
these amendments brought forward.
Councilmember Ranniger stated she would like to see the 501(c) exemption be
brought forward and continued discussion on the 3PLs.
Councilmember Berrios confirmed that there were ten CPLs and added that the City
needs to attract and keep current businesses here. He stated he wasn't sure of the
details with the 3PLs. However, he questioned if the City should allow current
businesses to grow in their current space and investigate exemptions to these
businesses. He suggested investigating if the City is collecting the proper amounts
from these businesses.
Nachlinger verified that they are looking for reductions in their rates, not exemptions.
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Kent City Council Workshop Minutes January 21, 2014
Mayor Cooke verified with Council President Ralph that this item should go to the
Economic and Community Development Committee.
Council President Ralph communicated that there is consensus to move the 501(c)
revisions to the Operations Committee.
Councilmember Higgins discussed the Sound Transit proposal for gas taxes which
would end up being $3.1 million to the City of Kent for transportation.
Councilmember Thomas communicated that he is against the item.
Council President Ralph communicated that the King County Council is discussing two
different packages and need to decide before March 7 whether or not to go to a ballot
measure. She added that they are also discussing bus fare increases.
Councilmember Higgins communicated that he felt the item is likely to pass county
wide and $3.1 million would be good for closing the gap in transportation
maintenance.
Council President Ralph communicated that Thomas is against, Higgins is in favor,
Ranniger is neutral, and Berrios wants more information. She concluded that she will
communicate to the South County Area Transportation Board that the Kent City
Council is neutral on this item.
Councilmember Thomas communicated that a sixty dollar increase in tabs invites
Eyman to create something worse.
Councilmember Higgins agreed, but noted that Eyman wants these to come to a vote
of the people.
Council President Ralph communicated that it technically isn't sixty dollars, the
current twenty dollar vehicle registration tax would drop off and be sixty dollars, thus
forty dollars more. She also informed the Council to discuss this item with
Councilmember Boyce.
Brubaker noted that this is Nachlinger's last Council workshop and is leaving the City
in very good shape and thanked him for his service to the City of Kent.
Nachlinger stated that he is looking forward to his retirement.
The meeting adjourned at 6:15 p.m.
Ronald F. Moore, MMC
City Clerk
4
KENT
Kent City Council Meeting
January 21, 2014
The regular meeting of the Kent City Council was called to order at 7:01 p.m. by
Mayor Cooke.
Councilmembers present: Higgins, Berrios, Boyce, Ralph, Ranniger, and Thomas.
CHANGES TO THE AGENDA
A. From Council, Administration, Staff - Brubaker communicated that the item in
front of the Councilmembers' dias was the attachment to the Transportation
Improvement Board grant.
B. From the Public - None.
PUBLIC COMMUNICATIONS
A. Oath of office, Councilmember Jim Berrios - City Clerk Ronald F. Moore swore
in Jim Berrios as Councilmember Position No. 2.
B. Public Recognition
1. Kent Parks Foundation Donation - Jeff Watling, Parks and Recreation
Director introduced Mark Prothero, President of the Kent Parks Foundation who
presented the city of Kent with a check for $9,532.57. Prothero also discussed the
"Kent Dancing with the Stars" and communicated that the event raised $13,846.15.
Mayor Cooke thanked Prothero and verified that people who wanted to get in donating
or raising funds for Kent's recreation program could speak to Sandy Pedersen.
2. Award for Men's "E" Western National ASA Softball Tournament to the
City of Kent - Jeff Watling, Parks and Recration Director introduced Mike Raven from
the Amateur Sports Association (ASA). Raven thanked the Kent City staff and
presented the James Ferrell Award to Mayor Cooke and the city of Kent.
Mayor Cooke thanked Raven and the city of Kent Parks staff.
C. Community Events - Mayor Cooke announced that the "You-Me-We" event is this
Friday at the ShoWare Center, January 24 at 6:00 p.m. She encouraged the public to
attend the free event.
Mayor Cooke also noted that her "State of the City Address" wil be at the ShoWare
Center during the Chamber of Commerce Luncheon on February 5 at 12 noon. She
also added that it will be online and on the City's cable station.
D. Introduction of new Arts Commission Appointee, Jennifer Treese - Mayor
Cooke communicated that she interviewed her for the position.
Kent City Council Meeting Minutes January 21, 2014
Treese communicated that she found the vacancy online and said she has been doing
cultural things for over a decade now. She added that her employer is Blue Origin, a
rocket company in Kent.
E. Public Safety Report - Police Chief Ken Thomas discussed Mike Buckingham and
his memorial service last Thursday. He discussed Buckingham's service to the City and
people. He noted that he lost his battle with cancer on January 2, 2014.
Council President Ralph discussed Buckingham and her son's experience with him. She
stated that she was fortunate enough to meet him and work with him the last couple
of years. She said he has had a tremendous impact on the City and will truly be
missed.
Thomas discussed the year end report. He noted that commercial burglary is
unchanged and there has been a 21 percent reduction in residential burglaries from
2012 to present. He noted that robbery is down 13 percent. He noted that vehicle theft
is only up 2 percent compared to the rampant vehicle theft rate in King County.
Thomas presented Christin Jordan with the Police Chiefs Award of Accomodation. He
communicated that Jordan was instrumental in a stolen car recovery and preventing a
residential burglary.
Thomas presented Shanelle Mozique with the Police Chief's Award of Accomodation. He
explained that Mozique, while in the middle of a home invasion, called the police
department during the robbery. He noted that the police successfully caught two of the
three suspects.
Thomas presented Officer Whisteric and Officer Nixon with the Police Department
Lifesaving Medal for saving the life of Lewis Drake. Drake submitted a letter to the
Police Chief, which he read.
Thomas communicated that the City is in the top ten of all cities with a population of
250,000 or less for their efforts with National Night Out, which is run by Sarah Wood.
Sarah Wood communicated that the event will be on August 10, 2014 this year.
Thomas introduced four new officers, Siitupe Coffin, Kamal Sharif, Andrew Richardson,
and Brittany Rios. He discussed each of their backgrounds, work experience, and
education.
Mayor Cooke swore in the four officers.
Thomas introduced newly hired Corrections Officer Ian Lentz and Records Specialists
Julie Farris, Ashley Orlowski, Christy Roeber, and Crystal Sundquist. He highlighted
their work history and gave a brief backgound of their education and personal lives.
Thomas presented a Chief's Award of Accomodation to Councilmember Berrios for
performing CPR on a patient who suffered a medical emergency.
Mayor Cooke presented Chief Ken Thomas with his city of Kent 25 year service plaque.
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Kent City Council Meeting Minutes January 21, 2014
F. Intergovernmental Reports - Council President Ralph communicated that the
South County Area Transportation Board met concerning express toll lanes being
added on Interstate 405 between Lynnwood and Bellevue and the addition of express
toll lanes on Interstate 167. She said the Lynnwood connection is going on now is
expected to open in 2016 and the 167 should be done a couple of years after that. She
noted that the 405 project will feature a new definition of what a carpool is and they
are suggesting three person carpools.
Councilmember Higgins stated that he is serving on the Sound Cities Association Board
of Directors and their board retreat is January 31. He said he is also serving on the
King County Regional Transit Committee and has heard the proposal concerning
funding transit. He stated that the King County Executive can't wait on legislature so
they are going forward to create a Transportation Benefit District countywide which
would mean the twenty dollar car tab going up to sixty dollars and a 0.1% sales tax.
Sixty percent of the revenues would go to King County for Metro, saving 600,000
service hours, including five routes in Kent and the remaining 40 percent would go to
cities.
Councilmember Boyce noted that he represents the City on the board and received
consensus from the Council to present a neutral vote on this item for the Kent City
Council until the entire package is reviewed. He noted that the next meeting is
February 12.
Councilmember Thomas thanked Councilmember Berrios for his efforts in helping save
a man's life on January 1st. He noted that it was discussed at the Regional Fire
Authority meeting.
PUBLIC HEARINGS
None.
PUBLIC COMMENT
Mayor Cooke discussed the council seat vacancy and communicated that
Council President Ralph will discuss the item under Other Business.
1. Pauline Barrett, Kent - Barrett discussed the possible development of a marijuana
processing facility by her home. She communicated that the facility would be in the
center of a large residential area with high school children in the neighborhood. She
expressed concerns with security if this business is allowed to open.
2. Bill Doolittle, Kent - Doolittle communicated that when I-502 was adopted people
wanted it legalized and taxed. He stated that Kent is going out of their way to prevent
marijuana authorization and said he read that the City would be zoned to prevent it.
He urged the City to work with the liquor board to get this implemented. He said
marijuana is currently being sold, consumed, and created in the City of Kent.
3
Kent City Council Meeting Minutes January 21, 2014
3. Thomas L. Brice, Kent - Brice discussed the Par 3 golf course and the vision of the
City. He said a committee has been formed by five residents and they have submitted
suggestions and ideas of what could be done concerning the course. He noted that
there is a debt and if you look at the books, the golf course isn't the problem. He
suggested the course be closed in the winter.
4. Martin Plys, Kent - Plys communicated that there is a $1.9 million surplus. He said
if there is a surplus it should be applied to the ShoWare Center and the golf course
should be sold.
Mayor Cooke verified that there isn't a surplus.
Plys opposed having any marijuana facilities in Kent.
CONSENT CALENDAR
Council President Ralph moved to approve Consent Calendar Items A through
P, seconded by Councilmember Thomas.
A. Minutes of the workshop and regular Council meeting of January P 2014 -
Approved
B. Appointment to Arts Commission —The Council confirmed the appointment of
Jennifer Treese to the Kent Arts Commission for a four year term ending October 31,
2017.
C. King County Solid Waste Division Waste Reduction & Recycling Grant -
Approved. - The Mayor was authorized to accept the Waste Reduction and Recycling
Grant Contract in the amount of $89,835 for 2014, and amend the budget and
authorize the expenditure of funds in accordance with the terms and conditions of the
grant, subject to final terms and conditions acceptable to the City Attorney and Public
Works Director.
D. Seattle-King County Health Department Local Hazardous Waste
Management Program/Recycling Event Grant- Approved. The Mayor was
authorized to accept the Local Hazardous Waste Management Program Contract in the
amount of $32,278.87 for 2014, and amend the budget and authorize the expenditure
of funds in accordance with the terms and conditions of the grant, subject to final
terms and conditions acceptable to the City Attorney and Public Works Director.
E. Contract with Olympic Environmental for 2014 -15 Residential Recycling
Collection Events- Approved. The Mayor was authorized to sign the Consultant
Services Agreement with Olympic Environmental Resources for Waste Reduction and
Recycling Activities and Programs for 2014 - 2015 in the amount of $185,551.00,
subject to final terms and conditions acceptable to the City Attorney and the Public
Works Director.
F. SR 516 to S 2315t Way Levee North Reach Improvements, Change order
No. 1- Approved. The Mayor was authorized to approve Change Order No. 1 to SCI
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Kent City Council Meeting Minutes January 21, 2014
Infrastructure, LLC in an amount not to exceed $194,059.46 for unanticipated
construction costs on the SR 516 to South 231st Way Levee, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
G. Central Avenue South Improvements Federal Grant- Accept. The Mayor was
authorized to accept a Federal Grant in the amount of $300,000 for the design phase
of the Central Avenue South Pavement Preservation Project, and amend the budget
and authorize expenditure of the funds in accordance with the terms and conditions of
the grant, subject to final terms and conditions acceptable to the City Attorney and
Public Works Director.
H. Kent Interurban Trail Connector Proiect Grant — Accept. The Mayor was
authorized to sign the grant agreement in the amount of $727,500 with the
Washington State Department of Commerce for the Kent Interurban Trail Connector
Project and amend the budget and authorize expenditure of the funds in accordance
with the terms and conditions of the grant, subject to final terms and conditions
acceptable to the City Attorney and Public Works Director.
I. South 224th Street Improvements, Phase 2 Transportation Improvement
Board (TIB) Grant- Accept. The Mayor was authorized to accept a grant from the
Washington State Transportation Improvement Board for Phase 2 of the South 224th
Street Improvement Project and sign a letter to the TIB requesting to combine Phases
1 and 2 into one project, amend the budget and authorize expenditure of the funds in
accordance with the terms and conditions of the grant, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
J. Washington Auto Theft Prevention Authority (WATPA) Patrol Task Force
2013 — 2015 Grant- Accept. The Mayor was authorized to accept the Washington
Auto Theft Prevention Authority grant award in the amount of $74,983, authorize
amending the budget and authorize expenditure of the funds in accordance with the
terms and conditions of the grant, acceptable to the City Attorney and Police Chief.
K. Ordinance Amending Kent City Code Chapter 9.02, Lewd Conduct — Adopt.
The Council adopted Ordinance No. amending Chapter 9.02 by establishing crimes
relating to lewd conduct, by amending sections relating to prostitution loitering and by
adding new areas which fall within the scope of the stay out of areas of prostitution
orders.
L. 2012 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2012 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc., upon receipt of standard releases from
the state and the release of any liens.
M. 2013 Thermo Plastic Markings Proiect Completion - Accept. They Mayor
was authorized to accept the 2013 Thermo Plastic Markings Project as complete and
release retainage to Stripe Rite Inc., upon receipt of standard releases from the state
and the release of any liens.
5
Kent City Council Meeting Minutes January 21, 2014
N. 2013 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2013 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc. upon receipt of standard releases from the
state and the release of any liens.
0. Hawley Road Levee Improvements Phase I Proiect Completion — Accept.
The Mayor was authorized to accept the Hawley Road Levee Improvements Phase I
Project as complete and release retainage to SCI Infrastructure LLC, upon receipt of
standard releases from the state and the release of any liens.
P. Horseshoe Bend and Upper Russell Road Levee Planting Proiect
Completion — Accept. The Mayor was authorized to accept the Horseshoe Bend and
Upper Russell Road Levee Plantings Project as complete and release retainage to
Restoration Logistics, upon receipt of standard releases from the state and the release
of any liens.
OTHER BUSINESS
A. Council Position No. 6 - Appointment Process - Mayor Cooke introduced the
item. Council President Ralph communicated the process and noted that the process
will be posted on the City's website and a handout was given to those in attendance by
City Clerk Moore.
Councilmember Boyce inquired what would happen with current applications and
Councilpresident Ralph communicated that she would communicate with anyone who
has previously submitted an application and inform them of the current process.
Councilmember Thomas inquired about the position and the process. Acting City
Attorney Fitzpatrick noted that the appointment lasts until the November 2015 election
is certified and whoever is elected at the general election will serve the rest of the
term.
1. Anna Davis, Kent - Davis discussed the process and inquired if the candidate that
also ran for the position in November could be considered and not have to reapply.
Mayor Cooke replied that the candidate needs to submit an application and go through
this process. She further explained the election process and said it is set up by state
law and it is up to the Council to interview and selects a candidate. She further
explained that it wasn't an option to have the runner-up in the November election
considered.
Council President Ralph also replied that this is the appointment process and that once
the November election is certified it is over. She also communicated that this
information will be on the website, channel 21, in the Kent Reporter, and announced at
Neighborhood Council meetings, etc.
BIDS
6
Kent City Council Meeting Minutes January 21, 2014
A. Briscoe-Desimone Levee Improvements, Reaches 2 and 3 - Tim LaPorte,
Public Works Director introduced the levee improvements. He displayed the levee, why
the improvements are needed, and what the improvements would entail. He
communicated that there were ten excellent bids and has checked out the
qualifications of the lowest bidder, Tapani, Inc. LaPorte explained to Mayor Cooke why
this item wasn't heard at a committee, noting that a bid award doesn't go to
committee, but straight to the Council.
Councilmember Higgins moved to authorize the Mayor to award the bid for
the Briscoe-Desimone Levee Improvements Reaches 2 and 3 project to
Tapani, Inc., in the amount of $6,709,555.56 and authorize the Mayor to sign
all necessary documents, subject to the final terms and conditions acceptable
to the City Attorney and Public Works Director, seconded by Council President
Ralph. Motion carried 6-0.
LaPorte communicated that King County Flood District wants a groundbreaking
ceremony for this levee improvement this spring.
Mayor Cooke agreed and communicated that the City should also look at what park
element should be added to the south.
REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
A. Council President. Ralph stated that the B&O tax was discussed in the workshop
meeting and that the Council decided to hold off on any amendments to it at this time.
She stated that there will be a 501(c) item exemption going forth as a draft to the
Operations Committee and an item concerning 3PLs going to the Economic and
Community Development Committee at a later date.
B. Mayor. No report.
C. Administration. No report. No executive session tonight.
D. Economic & Community Development Committee. Councilmember Boyce
communicated that the next meeting is February 10.
E. Operations Committee. No report.
F. Parks and Human Services Committee. No report.
G. Public Safety Committee. No report.
H. Public Works Committee. Councilmember Higgins communicated that the
meeting yesterday was postponed and the next meetig is January 27.
I. Regional Fire Authority. Councilmember Thomas communicated that he stepped
down as chair and Mike Denfro is the chair and Higgins is the deputy chair.
EXECUTIVE SESSION ACTION AFTER EXECUTIVE SESSION
7
Kent City Council Meeting Minutes January 21, 2014
No executive session was held.
ADJOURNMENT
The meeting adjourned at 8:38 p.m.
Ronald F. Moore, MMC
City Clerk
8
40.
KF14 Agenda Item: Consent — 7C
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointment to Kent Arts Commission — Confirm
MOTION: Confirm the Mayor's appointment of Lynn Bohart to the Kent
Arts Commission.
SUMMARY: Confirm the appointment of Lynn Bohart to the Kent Arts Commission for
a four year term ending October 31, 2017.
Lynn Bohart submitted an application for appointment to the Kent Arts Commission
to fill a vacant four year term. Lynn is Executive Director of the Renton Community
Foundation and remains an avid supporter of the arts. Lynn's belief is that a vibrant
arts community speaks to the soul of a city.
Lynn holds a Master's Degree in theater and has worked in Community Theater over
the years. She is a published mystery writer on Amazon.com, teaches writing through
the Kent Parks Department and Green River Community College's Continuing
Education program. She has served on the Lane County Arts Council Board while
living in Oregon and has served on the Vancouver Arts Commission before moving to
Kent.
Lynn's commitment to the Kent community and her active role in the arts makes her
an exceptional candidate for the Kent Arts Commission, and I am pleased to
recommend Lynn Bohart for your confirmation.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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KENT
° Agenda Item: Consent — 7D
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointments to Land Use and Planning Board — Confirm
MOTION: Confirm the Mayor's appointment of Katherine Jones and re-
appointment of Barbara Phillips to the Land Use & Planning Board.
SUMMARY: Confirm the appointment of Katherine Jones and re-appointment of
Barbara Phillips to the Land Use & Planning Board each for a three year term ending
December 31, 2016.
Katherine Jones made application for appointment to the Land Use & Planning Board
for a three-year term. Kathi, a Realtor with John L. Scott, lives in The Lakes
community, and feels her service on the LUPB will assist in promoting a healthier and
improved environment for all Kent citizens. Kathi's work as a realtor gives her an
understanding of the Smart Growth principles involving citizens, public officials and
stakeholders working together to plan ahead for development. Kathy has attended
many LUPB meetings and city council meetings in an effort to stay abreast of issues
confronting our community. She was an interested participant in the Midway Project,
the Cottage Housing Project, and is head of The Lakes Neighborhood Council
Kathi's commitment to the Kent community makes her an ideal candidate for the Land
Use & Planning Board, and I am pleased to recommend Kathi Jones for your
confirmation.
Barbara Phillips was first appointed to the Land Use & Planning Board in November,
2007, expressing her desire to be an integral part of the City's development and
future prosperity. Her reappointment will begin her third term which will expire on
December 31, 2016. Barbara has lived in Kent for over 20 years and currently is
President of the Community Network Council which works to connect youth with
resources that will help them become successful.
I am pleased to recommend re-appointment of Barbara Phillips to the LUPB.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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•
Nl- KENT Agenda Item: Consent- 7E
TO: City Council
DATE: February 4, 2014
SUBJECT: Refunding 2004 Limited Tax General Obligation Bond Ordinance - Adopt
MOTION: Move to adopt Ordinance No. , approving the refunding of
the 2004 Limited Tax General Obligation bonds.
SUMMARY: The 2004 LTGO bonds are callable at par on June 1, 2014 and may be
called 90 days in advance of the call date. This transaction would save an estimated
$700,000 over the eight year life of the bonds by issuing refunding bonds at a lower
interest rate. The existing bonds would be retired as of June 1 and defeased.
EXHIBITS: Ordinance
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: This transaction would reduce the debt service cost paid by the
Capital Improvements Fund by approximately $87,500 annually over the next eight
years.
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ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE OF LIMITED
TAX GENERAL OBLIGATION REFUNDING BONDS OF THE CITY
IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED
$14,000,000 TO REFUND CERTAIN OUTSTANDING LIMITED
TAX GENERAL OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM AND TERMS OF
THE BONDS; AND DELEGATING THE AUTHORITY TO
APPROVE THE FINAL TERMS OF THE BONDS.
PASSED: FEBRUARY 4, 2014
PREPARED BY:
PACIFICA LAW GROUP LLP
Seattle, Washington
CITY OF KENT
ORDINANCE NO.
TABLE OF CONTENTS*
Page
SECTION 1. - Definitions and Interpretation of Terms 2
SECTION 2. - Authorization of Bonds and Bond Details 8
SECTION 3. - Registration, Exchange and Payments 9
SECTION 4. - Redemption Prior to Maturity and Purchase
of Bonds 15
SECTION 5. - Form of Bonds 20
SECTION 6. - Execution of Bonds 22
SECTION 7. - Refunding Plan; Application of Bond
Proceeds 23
SECTION 8. - Tax Covenants 26
SECTION 9. - Bond Fund and Provision for Tax Levy
Payments 29
SECTION 10. - Defeasance 30
SECTION 11. - Sale of Bonds 31
SECTION 12. - Undertaking to Provide Ongoing Disclosure 33
SECTION 13. - Lost, Stolen or Destroyed Bonds 38
SECTION 14. - Severability; Ratification 38
SECTION 15. - Effective Date of Ordinance 40
* This Table of Contents is provided for convenience only and is not a part
of this ordinance.
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CITY OF KENT, WASHINGTON
ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE
OF LIMITED TAX GENERAL OBLIGATION
REFUNDING BONDS OF THE CITY IN THE
AGGREGATE PRINCIPAL AMOUNT OF NOT TO
EXCEED $14,000,000 TO REFUND CERTAIN
OUTSTANDING LIMITED TAX GENERAL
OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM
AND TERMS OF THE BONDS; AND DELEGATING
THE AUTHORITY TO APPROVE THE FINAL
TERMS OF THE BONDS.
A. The City of Kent, Washington (the "City") has outstanding its
Limited Tax General Obligation Refunding Bonds, 2004, issued pursuant to
Ordinance No. 3682 adopted by the City Council (the "Council") of the City
on March 16, 2004 (the "2004 Bond Ordinance"), which remain
outstanding as follows:
Maturity Date
(December 1) Principal Amount Interest Rate
2014 $ 1,875,000 5.000%
2015 1,750,000 5.250
2016 1,625,000 5.250
2017 1,445,000 5.250
2018 1,265,000 5.250
2019 1,280,000 4.000
2020 2,030,000 4.000
2021 1,325,000 4.125
(the "2004 Bonds"); and
B. The 2004 Bond Ordinance provides that the City may call the
2004 Bonds maturing on or after December 1, 2014 (the "Refunding
Candidates") for redemption on or after June 1, 2014, in whole or in part
at any time, at a price of par plus accrued interest, if any, to the date of
redemption; and
C. After due consideration it appears to the Council that all or a
portion of the Refunding Candidates may be defeased and refunded by the
proceeds of limited tax general obligation refunding bonds at a savings to
the City and its taxpayers; and
D. The Council deems it in the best interest of the City to issue
limited tax general obligation refunding bonds in the aggregate principal
amount of not to exceed $14,000,000 (the "Bonds") to redeem and
defease all or a portion of the Refunding Candidates and to pay costs of
issuing the Bonds; and
E. The Council wishes to delegate authority to the Mayor (the
"Designated Representative"), for a limited time, to approve the interest
rates, maturity dates, redemption terms and principal maturities for the
Bonds within the parameters set by this ordinance; and
F. The City expects to receive a proposal from KeyBanc Capital
Markets Inc. (the "Underwriter") and now desires to issue and sell the
Bonds to the Underwriter as set forth herein;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON DO ORDAIN as follows:
SECTION 1. - Definitions and Interpretation of Terms.
(a) Definitions. As used in this ordinance, the following words
shall have the following meanings:
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Limited Tax General Obligation Refunding Bonds, 2014
Acquired Obligations means the Government Obligations acquired
by the City under the terms of this ordinance and the Escrow Deposit
Agreement to effect the defeasance and refunding of the Refunded Bonds.
Beneficial Owner means any person that has or shares the power,
directly or indirectly, to make investment decisions concerning ownership
of any Bonds (including persons holding Bonds through nominees,
depositories or other intermediaries).
Bond Fund means the "City of Kent Limited Tax General Obligation
Bond Debt Service Fund, 2014" authorized to be created pursuant to
Section 9.
Bond Purchase Contract means the contract for the purchase of the
Bonds between the Underwriter and the City, executed pursuant to
Section 11.
Bond Register means the registration books showing the name,
address and tax identification number of each Registered Owner of the
Bonds, maintained pursuant to Section 149(a) of the Code.
Bond Registrar means, initially, the fiscal agency of the State of
Washington, for the purposes of registering and authenticating the Bonds,
maintaining the Bond Register, effecting transfer of ownership of the
Bonds and paying interest on and principal of the Bonds.
Bond Year means each one-year period that ends on the date
selected by the City. The first and last Bond Years may be short periods.
If no date is selected by the City before the earlier of the final maturity
date of Bonds or the date that is five years after the date of issuance of
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Limited Tax General Obligation Refunding Bonds, 2014
any Bonds, Bond Years end on each anniversary of the date of issue and
on the final maturity date of such Bonds.
Bonds mean the not to exceed $14,000,000 aggregate principal
amount of City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014, authorized to be issued pursuant to this
ordinance.
Call Date means June 1, 2014.
Chief Administrative Officer means the Chief Administrative Officer
or Interim Chief Administrative Officer of the City or the successor to such
officer.
City means the City of Kent, Washington, a municipal corporation
duly organized and existing under and by virtue of the Constitution and
laws of the State of Washington.
Code means the Internal Revenue Code of 1986, as amended, and
shall include all applicable regulations and rulings relating thereto.
Commission means the Securities and Exchange Commission.
Council or City Council means the legislative body of the City as
duly and regularly constituted from time to time.
Designated Representative means the Mayor, or his or her
designee.
DTC means The Depository Trust Company, New York, New York, a
limited purpose trust company organized under the laws of the State of
New York, as depository for the Bonds pursuant to Section 3.
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Limited Tax General Obligation Refunding Bonds, 2014
Escrow Agent means U.S. Bank National Association, Seattle,
Washington.
Escrow Deposit Agreement means the Escrow Deposit Agreement
between the City and the Escrow Agent to be dated as of the date of
closing of the Bonds and substantially in the form on file with the City.
Federal Tax Certificate means the certificate executed by the
Finance Director setting forth the requirements of the Code for
maintaining the tax exemption of interest on the Bonds, and attachments
thereto.
Finance Director means the Finance Director of the City or the
successor to such officer.
Financial Advisor means Piper ]affray & Co., or its successors.
Government Obligations mean those obligations now or hereafter
defined as such in chapter 39.53 RCW.
Letter of Representations means the blanket issuer letter of
representations from the City to DTC.
MSRB means the Municipal Securities Rulemaking Board or any
successors to its functions.
Net Proceeds, when used with reference to the Bonds, means the
principal amount of such Bonds, plus accrued interest and original issue
premium, if any, and less original issue discount, if any.
Private Person means any natural person engaged in a trade or
business or any trust, estate, partnership, association, company or
corporation.
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Limited Tax General Obligation Refunding Bonds, 2014
Private Person Use means the use of property in a trade or business
by a Private Person if such use is other than as a member of the general
public. Private Person Use includes ownership of the property by the
Private Person as well as other arrangements that transfer to the Private
Person the actual or beneficial use of the property (such as a lease,
management or incentive payment contract or other special arrangement)
in such a manner as to set the Private Person apart from the general
public. Use of property as a member of the general public includes
attendance by the Private Person at municipal meetings or business rental
of property to the Private Person on a short-term basis in accordance with
regulations under the Code if the rental paid by such Private Person is the
same as the rental paid by any Private Person who desires to rent the
property. Use of property by nonprofit community groups or community
recreational groups is not treated as Private Person Use if such use is
incidental to the governmental uses of property, the property is made
available for such use by all such community groups on an equal basis and
such community groups are charged only a de minimis fee to cover
custodial expenses.
Refunded Bonds mean all or a portion of the Refunding Candidates
designated by the Designated Representative for refunding pursuant to
Section 7 and Section 11.
Refunding Account means the account by that name established
pursuant to Section 7.
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Limited Tax General Obligation Refunding Bonds, 2014
Refunding Candidates mean the 2004 Bonds maturing on or after
December 1, 2014.
Registered Owner means the person named as the registered owner
of a Bond in the Bond Register. For so long as the Bonds are held in book-
entry only form, DTC or its nominee shall be deemed to be the sole
Registered Owner.
Rule means the Commission's Rule 15c2-12 under the Securities
Exchange Act of 1934, as the same may be amended from time to time.
2004 Bond Ordinance means Ordinance No. 3682 adopted by the
Council on March 16, 2004 authorizing the issuance of the 2004 Bonds.
2004 Bonds mean the City of Kent, Washington, Limited Tax
General Obligation Refunding Bonds, 2004 issued pursuant to the 2004
Bond Ordinance as described in the recitals of this ordinance.
Underwriter means KeyBanc Capital Markets Inc., or its successors.
(b) Interpretation. In this ordinance, unless the context
otherwise requires:
(1) The terms "hereby," "hereof," "hereto," "herein,"
"hereunder" and any similar terms, as used in this ordinance, refer to this
ordinance as a whole and not to any particular article, section, subdivision
or clause hereof, and the term "hereafter" shall mean after, and the term
"heretofore" shall mean before, the date of this ordinance;
(2) Words of the masculine gender shall mean and include
correlative words of the feminine and neuter genders and words importing
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Limited Tax General Obligation Refunding Bonds, 2014
the singular number shall mean and include the plural number and vice
versa;
(3) Words importing persons shall include firms,
associations, partnerships (including limited partnerships), trusts,
corporations and other legal entities, including public bodies, as well as
natural persons;
(4) Any headings preceding the text of the several articles
and sections of this ordinance, and any table of contents or marginal notes
appended to copies hereof, shall be solely for convenience of reference
and shall not constitute a part of this ordinance, nor shall they affect its
meaning, construction or effect; and
(5) All references herein to "articles," "sections" and other
subdivisions or clauses are to the corresponding articles, sections,
subdivisions or clauses hereof.
SECTION 2,- Authorization of Bonds and Bond Details. For the
purpose of refunding the Refunded Bonds and paying costs of issuance of
the Bonds, the City shall issue and sell limited tax general obligation
refunding bonds in the aggregate principal amount of not to exceed
$14,000,000 (the "Bonds").
The Bonds shall be general obligations of the City, shall be
designated "City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014" with other such designation as set forth in the
Bond Purchase Contract and approved by the Designated Representative.
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Limited Tax General Obligation Refunding Bonds, 2014
The Bonds shall be dated as of their date of initial delivery, shall be
fully registered as to both principal and interest, shall be in the
denomination of $5,000 each or any integral multiple thereof within a
maturity, shall be numbered separately in the manner and with any
additional designation as the Bond Registrar deems necessary for
purposes of identification and control, and shall bear interest payable on
the dates set forth in the Bond Purchase Contract. The Bonds shall bear
interest at the rates set forth in the Bond Purchase Contract; and shall
mature on the dates and in the principal amounts set forth in the Bond
Purchase Contract and as approved by a Designated Representative
pursuant to Section 11.
SECTION 3. - Registration, Exchange and Payments.
(a) Bond Registrar/Bond Register. The City hereby specifies and
adopts the system of registration approved by the Washington State
Finance Committee from time to time through the appointment the state
fiscal agency. The City shall cause a Bond Register to be maintained by
the Bond Registrar. So long as any Bonds remain outstanding, the Bond
Registrar shall make all necessary provisions to permit the exchange or
registration or transfer of Bonds at its principal corporate trust office. The
Bond Registrar may be removed at any time at the option of the Finance
Director upon prior notice to the Bond Registrar and a successor Bond
Registrar appointed by the Finance Director. No resignation or removal of
the Bond Registrar shall be effective until a successor shall have been
appointed and until the successor Bond Registrar shall have accepted the
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Limited Tax General Obligation Refunding Bonds, 2014
duties of the Bond Registrar hereunder. The Bond Registrar is authorized,
on behalf of the City, to authenticate and deliver Bonds transferred or
exchanged in accordance with the provisions of such Bonds and this
ordinance and to carry out all of the Bond Registrar's powers and duties
under this ordinance. The Bond Registrar shall be responsible for its
representations contained in the Certificate of Authentication of the Bonds.
(b) Registered Ownership. The City and the Bond Registrar, each
in its discretion, may deem and treat the Registered Owner of each Bond
as the absolute owner thereof for all purposes (except as provided in
Section 12 of this ordinance), and neither the City nor the Bond Registrar
shall be affected by any notice to the contrary. Payment of any such Bond
shall be made only as described in Section 3(h), but such Bond may be
transferred as herein provided. All such payments made as described in
Section 3(h) shall be valid and shall satisfy and discharge the liability of
the City upon such Bond to the extent of the amount or amounts so paid.
(c) DTC Acceptance/Letters of Representations. The Bonds
initially shall be held in fully immobilized form by DTC acting as
depository. To induce DTC to accept the Bonds as eligible for deposit at
DTC, the City has executed and delivered to DTC a Blanket Issuer Letter of
Representations. Neither the City nor the Bond Registrar will have any
responsibility or obligation to DTC participants or the persons for whom
they act as nominees (or any successor depository) with respect to the
Bonds in respect of the accuracy of any records maintained by DTC (or
any successor depository) or any DTC participant, the payment by DTC (or
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Limited Tax General Obligation Refunding Bonds, 2014
any successor depository) or any DTC participant of any amount in respect
of the principal of or interest on Bonds, any notice which is permitted or
required to be given to Registered Owners under this ordinance (except
such notices as shall be required to be given by the City to the Bond
Registrar or to DTC (or any successor depository)), or any consent given
or other action taken by DTC (or any successor depository) as the
Registered Owner. For so long as any Bonds are held in fully immobilized
form by a depository, DTC or its successor depository shall be deemed to
be the Registered Owner for all purposes hereunder, and all references
herein to the Registered Owners shall mean DTC (or any successor
depository) or its nominee and shall not mean the owners of any beneficial
interest in such Bonds.
(d) Use of Depository.
(1) The Bonds shall be registered initially in the name of
"Cede & Co.", as nominee of DTC, with one Bond maturing on each of the
maturity dates for the Bonds in a denomination corresponding to the total
principal therein designated to mature on such date. Registered
ownership of such Bonds, or any portions thereof, may not thereafter be
transferred except (A) to any successor of DTC or its nominee, provided
that any such successor shall be qualified under any applicable laws to
provide the service proposed to be provided by it; (B) to any substitute
depository appointed by the Finance Director pursuant to subsection (2)
below or such substitute depository's successor; or (C) to any person as
provided in subsection (4) below.
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Limited Tax General Obligation Refunding Bonds, 2014
(2) Upon the resignation of DTC or its successor (or any
substitute depository or its successor) from its functions as depository or a
determination by the Finance Director to discontinue the system of book
entry transfers through DTC or its successor (or any substitute depository
or its successor), the Finance Director may hereafter appoint a substitute
depository. Any such substitute depository shall be qualified under any
applicable laws to provide the services proposed to be provided by it.
(3) In the case of any transfer pursuant to clause (A) or
(B) of subsection (1) above, the Bond Registrar shall, upon receipt of all
outstanding Bonds, together with a written request on behalf of the
Finance Director, issue a single new Bond for each maturity then
outstanding, registered in the name of such successor or such substitute
depository, or their nominees, as the case may be, all as specified in such
written request of the Finance Director.
(4) In the event that (A) DTC or its successor (or
substitute depository or its successor) resigns from its functions as
depository, and no substitute depository can be obtained, or (B) the
Finance Director determines that it is in the best interest of the beneficial
owners of the Bonds that such owners be able to obtain physical Bond
certificates, the ownership of such Bonds may then be transferred to any
person or entity as herein provided, and such Bonds shall no longer be
held by a depository. The Finance Director shall deliver a written request
to the Bond Registrar, together with a supply of physical Bonds, to issue
Bonds as herein provided in any authorized denomination. Upon receipt
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Limited Tax General Obligation Refunding Bonds, 2014
by the Bond Registrar of all then outstanding Bonds together with a
written request on behalf of the Finance Director to the Bond Registrar,
new Bonds shall be issued in the appropriate denominations and
registered in the names of such persons as are requested in such written
request.
(e) Registration of Transfer of Ownership or Exchange; Change in
Denominations. The transfer of any Bond may be registered and Bonds
may be exchanged, but no transfer of any such Bond shall be valid unless
it is surrendered to the Bond Registrar with the assignment form
appearing on such Bond duly executed by the Registered Owner or such
Registered Owner's duly authorized agent in a manner satisfactory to the
Bond Registrar. Upon such surrender, the Bond Registrar shall cancel the
surrendered Bond and shall authenticate and deliver, without charge to
the Registered Owner or transferee therefor, a new Bond (or Bonds at the
option of the new Registered Owner) of the same date, maturity and
interest rate and for the same aggregate principal amount in any
authorized denomination, naming as Registered Owner the person or
persons listed as the assignee on the assignment form appearing on the
surrendered Bond, in exchange for such surrendered and cancelled Bond.
Any Bond may be surrendered to the Bond Registrar and exchanged,
without charge, for an equal aggregate principal amount of Bonds of the
same date, maturity and interest rate, in any authorized denomination.
The Bond Registrar shall not be obligated to register the transfer or to
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Limited Tax General Obligation Refunding Bonds, 2014
exchange any Bond during the 15 days preceding any principal payment
date any such Bond is to be redeemed.
(f) Bond Registrar's Ownership of Bonds. The Bond Registrar
may become the Registered Owner of any Bond with the same rights it
would have if it were not the Bond Registrar, and to the extent permitted
by law, may act as depository for and permit any of its officers or directors
to act as a member of, or in any other capacity with respect to, any
committee formed to protect the right of the Registered Owners of Bonds.
(g) Registration Covenant. The City covenants that, until all
Bonds have been surrendered and canceled, it will maintain a system for
recording the ownership of each Bond that complies with the provisions of
Section 149 of the Code.
(h) Place and Medium of Payment. 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 calculated on the basis of a year
of 360 days and twelve 30-day months. For so long as all Bonds are held
by a depository, payments of principal and interest thereon shall be made
as provided in accordance with the operational arrangements of DTC
referred to in the Letter of Representations. In the event that the Bonds
are no longer held by a depository, interest on the Bonds shall be paid by
check or draft mailed to the Registered Owners at the addresses for such
Registered Owners appearing on the Bond Register on the fifteenth day of
the month preceding the interest payment date, or upon the written
request of a Registered Owner of more than $1,000,000 of Bonds
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Limited Tax General Obligation Refunding Bonds, 2014
(received by the Bond Registrar at least 15 days prior to the applicable
payment date), such payment shall be made by the Bond Registrar by
wire transfer to the account within the United States designated by the
Registered Owner. Principal of the Bonds shall be payable upon
presentation and surrender of such Bonds by the Registered Owners at the
principal office of the Bond Registrar.
If any Bond shall be duly presented for payment and funds have not
been duly provided by the City on such applicable date, then interest shall
continue to accrue thereafter on the unpaid principal thereof at the rate
stated on such Bond until it is paid.
SECTION 4, - Redemption Prior to Maturity and Purchase of Bonds.
(a) Mandatory Redemption of Term Bonds and Optional
Redemption, if any. The Bonds shall be subject to optional redemption on
the dates, at the prices and under the terms set forth in the Bond
Purchase Contract approved by the Designated Representative pursuant to
Section 11. The Bonds shall be subject to mandatory redemption to the
extent, if any, set forth in the Bond Purchase Contract approved by the
Designated Representative pursuant to Section 11.
(b) Purchase of Bonds. The City reserves the right to purchase
any of the Bonds offered to it at any time at a price deemed reasonable by
the Finance Director.
(c) Selection of Bonds for Redemption. For as long as the Bonds
are held in book-entry only form, the selection of particular Bonds within a
maturity to be redeemed shall be made in accordance with the operational
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arrangements then in effect at DTC. If the Bonds are no longer held in
uncertificated form, the selection of such Bonds to be redeemed and the
surrender and reissuance thereof, as applicable, shall be made as provided
in the following provisions of this subsection (c). If the City redeems at
any one time fewer than all of the Bonds having the same maturity date,
the particular Bonds or portions of Bonds of such maturity to be redeemed
shall be selected by lot (or in such manner determined by the Bond
Registrar) in increments of $5,000. In the case of a Bond of a
denomination greater than $5,000, the City and the Bond Registrar shall
treat each Bond as representing such number of separate Bonds each of
the denomination of $5,000 as is obtained by dividing the actual principal
amount of Bonds by $5,000. In the event that only a portion of the
principal sum of a Bond is redeemed, upon surrender of such Bond at the
principal office of the Bond Registrar there shall be issued to the
Registered Owner, without charge therefor, for the then unredeemed
balance of the principal sum thereof, at the option of the Registered
Owner, a Bond or Bonds of like maturity and interest rate in any of the
denominations herein authorized.
(d) Notice of Redemption.
(1) Official Notice. For so long as the Bonds are held in
uncertificated form, notice of redemption (which notice may be
conditional) shall be given in accordance with the operational
arrangements of DTC as then in effect, and neither the City nor the Bond
Registrar will provide any notice of redemption to any Beneficial Owners.
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Limited Tax General Obligation Refunding Bonds, 2014
Thereafter (if the Bonds are no longer held in uncertificated form), notice
of redemption shall be given in the manner hereinafter provided. Unless
waived by any owner of Bonds to be redeemed, official notice of any such
redemption (which redemption may be conditioned by the Bond Registrar
on the receipt of sufficient funds for redemption or otherwise) shall be
given by the Bond Registrar on behalf of the City by mailing a copy of an
official redemption notice by first class mail at least 20 days and not more
than 60 days prior to the date fixed for redemption to the Registered
Owner of the Bond or Bonds to be redeemed at the address shown on the
Bond Register or at such other address as is furnished in writing by such
Registered Owner to the Bond Registrar.
All official notices of redemption shall be dated and shall state:
(A) the redemption date,
(B) the redemption price,
(C) if fewer than all outstanding Bonds are to be
redeemed, the identification by maturity (and, in the case of partial
redemption, the respective principal amounts) of the Bonds to be
redeemed,
(D) that (unless such notice is conditional) on the
redemption date the redemption price will become due and payable upon
each such Bond or portion thereof called for redemption, and that interest
thereon shall cease to accrue from and after said date, and
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(E) the place where such Bonds are to be
surrendered for payment of the redemption price, which place of payment
shall be the principal office of the Bond Registrar.
On or prior to any redemption date (unless such notice is
conditional), the City shall deposit with the Bond Registrar an amount of
money sufficient to pay the redemption price of all the Bonds or portions
of Bonds which are to be redeemed on that date.
(2) Effect of Notice; Bonds Due. If an unconditional notice
of redemption has been given as aforesaid, or if the conditions to
redemption have been satisfied or waived, the Bonds or portions of Bonds
so to be redeemed shall, on the redemption date, become due and
payable at the redemption price therein specified, and from and after such
date such Bonds or portions of Bonds shall cease to bear interest. Upon
surrender of such Bonds for redemption in accordance with said notice,
such Bonds shall be paid by the Bond Registrar at the redemption price.
Installments of interest due on or prior to the redemption date shall be
payable as herein provided for payment of interest. All Bonds which have
been redeemed shall be canceled by the Bond Registrar and shall not be
reissued.
If a conditional notice of redemption has been given and the
conditions to redemption have not been satisfied or waived, notice of
redemption given pursuant to this ordinance may be rescinded by written
notice given by the Bond Registrar on behalf of the City as soon as
practicable in the same manner, and to the same Registered Owners of
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the Bond or Bonds, as notice of such redemption was given pursuant to
this Section 4(d). If notice of recession has been provided, the Bonds or
portions of Bonds so to be redeemed, on the redemption date, shall not
become due and payable and from and after such date such Bonds or
portions of Bonds shall continue to bear interest at the rate or rates set
forth therein until paid or until due provision is made for the payment of
the same.
(3) Additional Notice. In addition to the foregoing notice,
further notice shall be given by the City as set out below, but no defect in
said further notice nor any failure to give all or any portion of such further
notice shall in any manner defeat the effectiveness of a call for redemption
if notice thereof is given as above prescribed. Each further notice of
redemption given hereunder shall contain the information required above
for an official notice of redemption plus (A) the CUSIP numbers of all
Bonds being redeemed; (B) the date of issue of the Bonds as originally
issued; (C) the rate of interest borne by each Bond being redeemed;
(D) the maturity date of each Bond being redeemed; and (E) any other
descriptive information needed to identify accurately the Bonds being
redeemed. Each further notice of redemption may be sent at least
20 days before the redemption date to each party entitled to receive
notice pursuant to Section 12 and with such additional information as the
City shall deem appropriate, but such mailings shall not be a condition
precedent to the redemption of such Bonds.
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(4) Amendment of Notice Provisions. The foregoing notice
provisions of this Section 4, including but not limited to the information to
be included in redemption notices and the persons designated to receive
notices, may be amended by additions, deletions and changes in order to
maintain compliance with duly promulgated regulations and
recommendations regarding notices of redemption of municipal securities.
SECTIONS. - Form of Bonds. The Bonds shall be in substantially
the following form with appropriate or necessary insertions, depending
upon the omissions and variations as permitted or required hereby:
UNITED STATES OF AMERICA
NO. $
STATE OF WASHINGTON
CITY OF KENT
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2014
INTEREST RATE: % MATURITY DATE: CUSIP NO.:
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The City of Kent, Washington (the "City"), hereby acknowledges
itself to owe and for value received promises to pay to the Registered
Owner identified above, or registered assigns, on the Maturity Date
identified above, the Principal Amount indicated above and to pay interest
thereon from , 2014, or the most recent date to which
interest has been paid or duly provided for until payment of this bond at
the Interest Rate set forth above, payable on and
semiannually thereafter on the first days of each succeeding and
Both principal of and interest on this bond are payable in lawful
money of the United States of America. The fiscal agency of the State of
Washington has been appointed by the City as the authenticating agent,
paying agent and registrar for the bonds of this issue (the "Bond
Registrar"). For so long as the bonds of this issue are held in fully
immobilized form, payments of principal and interest thereon shall be
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made as provided in accordance with the operational arrangements of The
Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter
of Representations (the "Letter of Representations") from the City to DTC.
The bonds of this issue are issued under and in accordance with the
provisions of the Constitution and applicable statutes of the State of
Washington and Ordinance No. duly passed by the City Council
on February 4, 2014 (the "Bond Ordinance"). Capitalized terms used in
this bond have the meanings given such terms in the Bond Ordinance.
This bond shall not be valid or become obligatory for any purpose or
be entitled to any security or benefit under the Bond Ordinance until the
Certificate of Authentication hereon shall have been manually signed by or
on behalf of the Bond Registrar or its duly designated agent.
This bond is one of an authorized issue of bonds of like series, date,
tenor, rate of interest and date of maturity, except as to number and
amount in the aggregate principal amount of $ and is issued
pursuant to the Bond Ordinance to provide a portion of the funds
necessary (a) to defease and refund certain limited tax general obligation
bonds of the City, and (b) to pay costs of issuance.
[The bonds of this issue are subject to redemption as provided in
the Bond Ordinance and the Bond Purchase Contract.]
The City hereby irrevocably covenants and agrees with the owner of
this bond that it will include in its annual budget and levy taxes annually,
within and as a part of the tax levy permitted to the City without a vote of
the electorate, upon all the property subject to taxation in amounts
sufficient, together with other money legally available therefor, to pay the
principal of and interest on this bond as the same shall become due. The
full faith, credit and resources of the City are hereby irrevocably pledged
for the annual levy and collection of such taxes and the prompt payment
of such principal and interest.
[The bonds of this issue have [not] been designated by the City as
"qualified tax-exempt obligations" for investment by financial institutions
under Section 265(b) of the Code.]
The pledge of tax levies for payment of principal of and interest on
the bonds may be discharged prior to maturity of the bonds by making
provision for the payment thereof on the terms and conditions set forth in
the Bond Ordinance.
It is hereby certified that all acts, conditions and things required by
the Constitution and statutes of the State of Washington to exist and to
have happened, been done and performed precedent to and in the
issuance of this bond exist and have happened, been done and performed
and that the issuance of this bond and the bonds of this issue does not
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violate any constitutional, statutory or other limitation upon the amount of
bonded indebtedness that the City may incur.
IN WITNESS WHEREOF, the City of Kent, Washington has caused
this bond to be executed by the manual or facsimile signatures of the
Mayor and the City Clerk and the seal of the City imprinted, impressed or
otherwise reproduced hereon as of this _ day of 2014.
[SEAL]
CITY OF KENT,
WASHINGTON
By /s/ manual or facsimile
Mayor
ATTEST:
/s/ manual or facsimile
City Clerk
The Bond Registrar's Certificate of Authentication on the Bonds shall
be in substantially the following form:
CERTIFICATE OF AUTHENTICATION
This bond is one of the bonds described in the within-mentioned
Bond Ordinance and is one of the Limited Tax General Obligation
Refunding Bonds, 2014 of the City of Kent, Washington, dated
2014.
WASHINGTON STATE FISCAL
AGENCY, as Bond Registrar
By
SECTION 6. - Execution of Bonds. The Bonds shall be executed on
behalf of the City with the manual or facsimile signature of the Mayor and
attested by the manual or facsimile signature of the City Clerk and the
seal of the City shall be impressed, imprinted or otherwise reproduced
thereon.
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Only such Bonds as shall bear thereon a Certificate of
Authentication in the form hereinbefore recited, manually executed by the
Bond Registrar, shall be valid or obligatory for any purpose or entitled to
the benefits of this ordinance. Such Certificate of Authentication shall be
conclusive evidence that the Bonds so authenticated have been duly
executed, authenticated and delivered hereunder and are entitled to the
benefits of this ordinance.
In case either of the officers who shall have executed the Bonds
shall cease to be an officer or officers of the City before the Bonds so
signed shall have been authenticated or delivered by the Bond Registrar,
or issued by the City, such Bonds may nevertheless be authenticated,
delivered and issued and upon such authentication, delivery and issuance,
shall be as binding upon the City as though those who signed the same
had continued to be such officers of the City. Any Bond may be signed
and attested on behalf of the City by such persons who at the date of the
actual execution of such Bond, are the proper officers of the City, although
at the original date of such Bond any such person shall not have been
such officer of the City.
SECTION 7. - Refunding Plan; Application of Bond Proceeds.
(a) Refunding Plan. For the purpose of realizing a debt service
savings, the City proposes to defease and refund the Refunded Bonds as
set forth herein. The Refunded Bonds shall include all or a portion of the
Refunding Candidates as designated by the Designated Representative
and set forth in the Bond Purchase Contract. Proceeds of the Bonds shall
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be deposited with the Escrow Agent pursuant to the Escrow Deposit
Agreement to be used immediately upon receipt thereof to defease the
Refunded Bonds as authorized by the 2004 Bond Ordinance and to pay
costs of issuance of the Bonds.
The net proceeds deposited with the Escrow Agent shall be used to
defease the Refunded Bonds and discharge the obligations thereon by the
purchase of certain Government Obligations (which obligations so
purchased, are herein called "Acquired Obligations"), bearing such interest
and maturing as to principal and interest in such amounts and at such
times which, together with any necessary beginning cash balance, will
provide for the payment of:
(1) interest on the Refunded Bonds as such becomes due
on and prior to the Call Date; and
(2) the redemption price (100% of the principal amount)
of the Refunded Bonds on the Call Date.
Such Acquired Obligations shall be purchased at a yield not greater
than the yield permitted by the Code and regulations relating to acquired
obligations in connection with refunding bond issues.
(b) Escrow Agent/Escrow Deposit Agreement. The City hereby
appoints U.S. Bank National Association, Seattle, Washington, as the
Escrow Agent for the Refunded Bonds (the "Escrow Agent'). A beginning
cash balance, if any, and the Acquired Obligations shall be deposited
irrevocably with the Escrow Agent in an amount sufficient to defease the
Refunded Bonds. The proceeds of the Bonds remaining after acquisition of
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the Acquired Obligations and provision for the necessary beginning cash
balance shall be utilized to pay expenses of the acquisition and
safekeeping of the Acquired Obligations and costs of issuance of the
Bonds.
In order to carry out the purposes of this Section 7, the Finance
Director is authorized and directed to execute and deliver to the Escrow
Agent, an Escrow Deposit Agreement.
(c) Call for Redemption of Refunded Bonds. The City hereby sets
aside sufficient funds out of the purchase of Acquired Obligations from
proceeds of the Bonds to make the payments described above.
The City hereby calls the Refunded Bonds for redemption on their
Call Date in accordance with the provisions of the 2004 Bond Ordinance
authorizing the redemption and retirement of the 2004 Bonds, prior to
their fixed maturities.
Said defeasance and call for redemption of the Refunded Bonds
shall be irrevocable after the issuance of the Bonds and delivery of the
Acquired Obligations to the Escrow Agent.
The Escrow Agent is hereby authorized and directed to provide for
the giving of notices of the redemption of the Refunded Bonds in
accordance with the applicable provisions of the 2004 Bond Ordinance.
The costs of publication of such notices shall be an expense of the City.
The Escrow Agent is hereby authorized and directed to pay to the
Finance Director, or, at the direction of the Finance Director, to the paying
agent for the Refunded Bonds, sums sufficient to pay, when due, the
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payments specified in this Section 7. All such sums shall be paid from the
moneys and Acquired Obligations deposited with the Escrow Agent, and
the income therefrom and proceeds thereof. All such sums so paid to or
to the order of the Finance Director shall be credited to the Refunding
Account. All moneys and Acquired Obligations deposited with the Escrow
Agent and any income therefrom shall be held, invested (but only at the
direction of the Finance Director) and applied in accordance with the
provisions of this ordinance and with the laws of the State of Washington
for the benefit of the City and owners of the Refunded Bonds.
The City will take such actions as are found necessary to see that all
necessary and proper fees, compensation and expenses of the Escrow
Agent for the Refunded Bonds shall be paid when due.
SECTION B. - Tax Covenants.
The City covenants that it will not take or permit to be taken on its
behalf any action that would adversely affect the exemption from federal
income taxation of the interest on the Bonds 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 Bonds.
(a) Arbitrage Covenant. 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 proceeds of sale of the Bonds or any other
funds of the City which may be deemed to be proceeds of the Bonds
pursuant to Section 148 of the Code and the regulations promulgated
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thereunder which, if such use had been reasonably expected on the dates
of delivery of the Bonds to the initial purchasers thereof, would have
caused the Bonds to be treated as "arbitrage bonds" within the meaning of
such term as used in Section 148 of the Code. The City will comply with
the requirements of Section 148 of the Code and the applicable
regulations thereunder throughout the term of the Bonds.
(b) Private Person Use Limitation for the Bonds. The City
covenants that for as long as the Bonds are outstanding, it will not permit:
(1) More than 10% of the Net Proceeds of the Bonds to be
allocated to any Private Person Use; and
(2) More than 10% of the principal or interest payments
on the Bonds in a Bond Year to be directly or indirectly: (A) secured by
any interest in property used or to be used for any Private Person Use or
secured by payments in respect of property used or to be used for any
Private Person Use, or (B) derived from payments (whether or not made
to the City) in respect of property, or borrowed money, used or to be used
for any Private Person Use.
The City further covenants that, if:
(3) More than five percent of the Net Proceeds of the
Bonds are allocable to any Private Person Use; and
(4) More than five percent of the principal or interest
payments on the Bonds in a Bond Year are (under the terms of this
ordinance or any underlying arrangement) directly or indirectly:
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(A) secured by any interest in property used or to be
used for any Private Person Use or secured by payments in respect
of property used or to be used for any Private Person Use, or
(B) derived from payments (whether or not made to
the City) in respect of property, or borrowed money, used or to be
used for any Private Person Use, then, (i) any Private Person Use of
the projects described in subsection (3) hereof or Private Person
Use payments described in subsection (4) hereof that is in excess of
the five percent limitations described in such subsections (3) or (4)
will be for a Private Person Use that is related to the state or local
governmental use of the projects refunded by the proceeds of the
Bonds, and (ii) any Private Person Use will not exceed the amount
of Net Proceeds of the Bonds allocable to the state or local
governmental use portion of the projects(s) to which the Private
Person Use of such portion of the projects refunded by the proceeds
of the Bonds relate. The City further covenants that it will comply
with any limitations on the use of the projects refunded by the
proceeds of the Bonds by other than state and local governmental
users that are necessary, in the opinion of its bond counsel, to
preserve the tax exemption of the interest on the Bonds.
(c) Modification of Tax Covenants. The covenants of this section
are specified solely to assure the continued exemption from regular
income taxation of the interest on the Bonds. To that end, the provisions
of this section may be modified or eliminated without any requirement for
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formal amendment thereof upon receipt of an opinion of the City's bond
counsel that such modification or elimination will not adversely affect the
tax exemption of interest on any Bonds.
(d) In the Federal Tax Certificate the City may designate the
Bonds as "qualified tax-exempt obligations" under Section 265(b)(3) of
the Code for investment by financial institutions if at the time of such
designation it reasonably does not expect to issue more than $10,000,000
in qualifying tax-exempt debt during calendar year 2014.
SECTION 9. - Bond Fund and Provision for Tax Levy Payments.
The City hereby authorizes the creation of a fund to be used for the
payment of debt service on the Bonds, designated as the "City of Kent
Limited Tax General Obligation Bond Debt Service Fund, 2014" (the "Bond
Fund"). No later than the date each payment of principal of or interest on
the Bonds becomes due, the City shall transmit sufficient funds, from the
Bond Fund or from other legally available sources, to the Bond Registrar
for the payment of such principal or interest. Money in the Bond Fund
may be invested in legal investments for City funds.
The City hereby irrevocably covenants and agrees for as long as any
of the Bonds are outstanding and unpaid that each year it will include in
its budget and levy an ad valorem tax upon all the property within the City
subject to taxation in an amount that will be sufficient, together with all
other revenues and money of the City legally available for such purposes,
to pay the principal of and interest on the Bonds when due.
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The City hereby irrevocably pledges that the annual tax provided for
herein to be levied for the payment of such principal and interest shall be
within and as a part of the tax levy permitted to cities without a vote of
the people, and that a sufficient portion of each annual levy to be levied
and collected by the City prior to the full payment of the principal of and
interest on the Bonds will be and is hereby irrevocably set aside, pledged
and appropriated for the payment of the principal of and interest on the
Bonds. The full faith, credit and resources of the City are hereby
irrevocably pledged for the annual levy and collection of said taxes and for
the prompt payment of the principal of and interest on the Bonds when
due.
SECTION 10. - Defeasance. In the event that the City, to effect
the payment, retirement or redemption of any Bond, sets aside in the
Bond Fund or in another special account, cash or noncallable Government
Obligations, or any combination of cash and/or noncallable Government
Obligations, in amounts and maturities which, together with the known
earned income therefrom, are sufficient to redeem or pay and retire such
Bond in accordance with its terms and to pay when due the interest and
redemption premium, if any, thereon, and such cash and/or noncallable
Government Obligations are irrevocably set aside and pledged for such
purpose, then no further payments need be made into the Bond Fund for
the payment of the principal of and interest on such Bond. The owner of a
Bond so provided for shall cease to be entitled to any lien, benefit or
security of this ordinance except the right to receive payment of principal,
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premium, if any, and interest from the Bond Fund or such special account,
and such Bond shall be deemed to be not outstanding under this
ordinance.
The City shall give written notice of defeasance to the owners of all
Bonds so provided for within 30 days of the defeasance and to each party
entitled to receive notice in accordance with Section 12.
SECTION 11. - Sale of Bonds.
(a) Bond Sale. The Bonds shall be sold at negotiated sale to the
Underwriter pursuant to the terms of the Bond Purchase Contract. The
Financial Advisor has advised the Council that market conditions are
fluctuating and, as a result, the most favorable market conditions may
occur on a day other than a regular meeting date of the Council. The
Council has determined that it would be in the best interest of the City to
delegate to the Designated Representative for a limited time the authority
to approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, selection of the Refunded Bonds,
and redemption rights.
The Designated Representative is hereby authorized to designate a
portion or all of the Refunding Candidates as Refunded Bonds, and to
approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, and redemption rights for the
Bonds in the manner provided hereafter so long as (i) the aggregate
principal amount of the Bonds does not exceed $14,000,000, (ii) the final
maturity date for the Bonds is no later than December 1, 2021, (iii) the
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Bonds are sold (in the aggregate) at a price not less than 97% and not
greater than 120%, (iv) the Bonds are sold for a price that results in a
minimum net present value debt service savings over the Refunded Bonds
of at least 3.0%, (v) the true interest cost for the Bonds (in the
aggregate) does not exceed 3.5%; and (vi) the Bonds conform to all other
terms of this ordinance. Subject to the terms and conditions set forth in
this section, the Designated Representative is hereby authorized to
execute the Bond Purchase Contract.
Following the execution of the Bond Purchase Contract, the Finance
Director shall provide a report to the Council describing the final terms of
the Bonds approved pursuant to the authority delegated in this section.
The authority granted to the Designated Representative by this Section 11
shall expire 120 days after the effective date of this ordinance. If a Bond
Purchase Contract for the Bonds has not been executed within 120 days
after the effective date of this ordinance, the authorization for the
issuance of the Bonds shall be rescinded, and the Bonds shall not be
issued nor their sale approved unless such Bonds shall have been re-
authorized by ordinance of the Council. The ordinance re-authorizing the
issuance and sale of such Bonds may be in the form of a new ordinance
repealing this ordinance in whole or in part or may be in the form of an
amendatory ordinance approving a bond purchase contract or establishing
terms and conditions for the authority delegated under this Section 11.
(b) Delivery of Bonds; Documentation. Upon the passage and
approval of this ordinance, the proper officials of the City, including the
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Finance Director and Chief Administrative Officer, are authorized and
directed to undertake all action necessary for the prompt execution and
delivery of the Bonds to the Underwriter and further to execute all closing
certificates and documents required to effect the closing and delivery of
the Bonds in accordance with the terms of this ordinance and the Bond
Purchase Contract.
(c) Preliminary and Final Official Statements. The Finance
Director is hereby authorized to ratify and to deem final the preliminary
Official Statement relating to the Bonds for the purposes of the Rule. The
Finance Director is further authorized to ratify and to approve for purposes
of the Rule, on behalf of the City, the final Official Statement relating to
the issuance and sale of the Bonds and the distribution of the final Official
Statement pursuant thereto with such changes, if any, as may be deemed
by her to be appropriate.
SECTION 12. - Undertaking to Provide Ongoing Disclosure.
(a) Contract/Undertaking. This section constitutes the City's
written undertaking for the benefit of the owners, including Beneficial
Owners, of the Bonds as required by Section (b)(5) of the Rule.
(b) Financial Statements/Operating Data. The City agrees to
provide or cause to be provided to the MSRB the following annual financial
information and operating data for the prior fiscal year (commencing in
2014 for the fiscal year ended December 31, 2013):
1. Annual financial statements, which statements may or
may not be audited, showing ending fund balances for the City's general
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fund prepared in accordance with the Budgeting Accounting and Reporting
System prescribed by the Washington State Auditor pursuant to
RCW 43.09.200 (or any successor statute) and generally of the type
specified in the official statement for the Bonds;
2. The assessed valuation of taxable property in the City;
3. Ad valorem taxes due and percentage of taxes
collected;
4. Property tax levy rate per $1,000 of assessed
valuation; and
5. Outstanding general obligation debt of the City.
Items 2-5 shall be required only to the extent that such information is not
included in the annual financial statements.
The information and data described above shall be provided on or
before nine months after the end of the City's fiscal year. The City's
current fiscal year ends December 31. The City may adjust such fiscal
year by providing written notice of the change of fiscal year to the MSRB.
In lieu of providing such annual financial information and operating data,
the City may cross-reference to other documents available to the public on
the MSRB's internet website or filed with the Commission.
If not provided as part of the annual financial information discussed
above, the City shall provide to the MSRB the City's audited annual
financial statements prepared in accordance with the Budgeting
Accounting and Reporting System prescribed by the Washington State
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Auditor pursuant to RCW 43.09.200 (or any successor statute) when and if
available.
(c) Listed Events. The City agrees to provide or cause to be
provided to the MSRB, in a timely manner not in excess of ten business
days after the occurrence of the event, notice of the occurrence of any of
the following events with respect to the Bonds:
• Principal and interest payment delinquencies;
• Non-payment related defaults, if material;
• Unscheduled draws on debt service reserves reflecting
financial difficulties;
• Unscheduled draws on credit enhancements reflecting
financial difficulties;
• Substitution of credit or liquidity providers, or their failure to
perform;
• Adverse tax opinions, the issuance by the Internal Revenue
Service of proposed or final determinations of taxability,
Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax
status of the Bonds, or other material events affecting the tax
status of the Bonds;
• Modifications to the rights of Bondholders, if material;
• Bond calls, if material, and tender offers;
• Defeasances;
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• Release, substitution, or sale of property securing repayment
of the Bonds, if material;
• Rating changes;
• Bankruptcy, insolvency, receivership or similar event of the
City;
• The consummation of a merger, consolidation, or acquisition
involving the City or the sale of all or substantially all of the
assets of the City, other than in the ordinary course of
business, the entry into a definitive agreement to undertake
such an action or the termination of a definitive agreement
relating to any such actions, other than pursuant to its terms,
if material; and
• Appointment of a successor or additional trustee or the
change of name of a trustee, if material.
The City shall promptly determine whether the events described above are
material.
(d) Format for Filings with the MSRB. All notices, financial
information and operating data required by this undertaking to be
provided to the MSRB must be in an electronic format as prescribed by the
MSRB. All documents provided to the MSRB pursuant to this undertaking
must be accompanied by identifying information as prescribed by the
MSRB.
(e) Notification Upon Failure to Provide Financial Data. The City
agrees to provide or cause to be provided, in a timely manner, to the
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MSRB notice of its failure to provide the annual financial information
described in Subsection (b) above on or prior to the date set forth in
Subsection (b) above.
(f) Termination/Modification. The City's obligations to provide
annual financial information and notices of certain listed events shall
terminate upon the legal defeasance, prior redemption or payment in full
of all of the Bonds. Any provision of this section shall be null and void if
the City (1) obtains an opinion of nationally recognized bond counsel to
the effect that the portion of the Rule that requires that provision is
invalid, has been repealed retroactively or otherwise does not apply to the
Bonds and (2) notifies the MSRB of such opinion and the cancellation of
this section.
The City may amend this section with an opinion of nationally
recognized bond counsel in accordance with the Rule. In the event of any
amendment of this section, the City shall describe such amendment in the
next annual report, and shall include a narrative explanation of the reason
for the amendment and its impact on the type (or in the case of a change
of accounting principles, on the presentation) of financial information or
operating data being presented by the City. In addition, if the amendment
relates to the accounting principles to be followed in preparing financial
statements, (A) notice of such change shall be given in the same manner
as for a listed event under Subsection (c), and (B) the annual report for
the year in which the change is made shall present a comparison (in
narrative form and also, if feasible, in quantitative form) between the
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financial statements as prepared on the basis of the new accounting
principles and those prepared on the basis of the former accounting
principles.
(g) Bond Owner's Remedies Under This Section. The right of any
bondowner or Beneficial Owner of Bonds to enforce the provisions of this
section shall be limited to a right to obtain specific enforcement of the
City's obligations under this section, and any failure by the City to comply
with the provisions of this undertaking shall not be an event of default
with respect to the Bonds.
(h) No Default. Except as otherwise disclosed in the City's official
statement relating to the Bonds, the City is not and has not been in
default in the performance of its obligations of any prior undertaking for
ongoing disclosure with respect to its obligations.
SECTION 13. - Lost, Stolen or Destroyed Bonds. In case any
Bond or Bonds shall be lost, stolen or destroyed, the Bond Registrar may
execute and deliver a new Bond or Bonds of like date, number and tenor
to the Registered Owner thereof upon the Registered Owner's paying the
expenses and charges of the City and the Bond Registrar in connection
therewith and upon his/her filing with the City evidence satisfactory to the
City that such Bond was actually lost, stolen or destroyed and of his/her
ownership thereof, and upon furnishing the City and/or the Bond Registrar
with indemnity satisfactory to the City and the Bond Registrar.
SECTION 14. - Severability; Ratification. If any one or more of
the covenants or agreements provided in this ordinance to be performed
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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 deemed
separable from the remaining covenants and agreements of this ordinance
and shall in no way affect the validity of the other provisions of this
ordinance or of the Bonds. All acts taken pursuant to the authority
granted in this ordinance but prior to its effective date are hereby ratified
and confirmed.
-39-
Limited Tax General Obligation Refunding Bonds, 2014
SECTION 15. - Effective Date of Ordinance. This ordinance shall
take effect and be in force five days after its passage, approval, and
publication as provided by law.
Adopted by the City Council of the City of Kent, Washington, at a
regular meeting thereof held this 4th of February, 2014.
By
Suzette Cooke, Mayor
ATTEST
Ronald F. Moore, MMC, City
Clerk
APPROVED AS TO FORM:
PACIFICA LAW GROUP LLP
Bond Counsel
PASSED: of February, 2014
APPROVED: of February, 2014
PUBLISHED: of February, 2014
-40-
Limited Tax General Obligation Refunding Bonds, 2014
CERTIFICATION
I, the undersigned, City Clerk of the City of Kent, Washington (the
"City"), hereby certify as follows:
1. The attached copy of Ordinance No. (the
"Ordinance") is a full, true and correct copy of an ordinance duly passed at
a regular meeting of the City Council of the City held at the regular time
and meeting place thereof on February 4, 2014, as that ordinance appears
on the minute book of the City; and the Ordinance will be in full force and
effect after its passage; and
2. A quorum of the members of the City Council was present
throughout the meeting and a majority of those members present voted in
the proper manner for the passage of the Ordinance.
IN WITNESS WHEREOF, I have hereunto set my hand this 4th day
of February, 2014.
CITY OF KENT, WASHINGTON
Ronald F. Moore, MMC, City Clerk
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KENT
Agenda Item: Consent — 7F
TO: City Council
DATE: February 4, 2014
SUBJECT: Budget Certification for Annexation Sales Tax Credit Resolution — Adopt
MOTION: Move to adopt Resolution No. , approving the certification
of $4,230,777 for the Panther Lake annexation sales tax credit for the
period July 1, 2014 through June 30, 2015.
SUMMARY: The City is required to certify to the state of Washington before March Vt
of each year, the amount needed from the annexation sales tax credit to provide
services in the annexed area. The Finance Department has calculated the costs and
revenues within the Panther Lake annexation area and has determined a gap between
revenues generated and expenditures used to provide services of $4,230,777 for July
1, 2014 through June 30, 2015.
EXHIBITS: Resolution
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: The budget for the Panther Lake annexation area for the State's
fiscal year 2013 is anticipated to be $11,949,899 in expenditures to provide City
services to those residents, while we anticipate revenues of $7,719,122 from property
taxes, sales taxes and other sources. The net of the revenues and costs produces a
deficit of $4,230,777 which is the amount being certified as the amount of annexation
sales tax credit we are requesting from the State.
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RESOLUTION NO.
A RESOLUTION of the City Council of the
City of Kent, Washington, determining a new
threshold amount for the sales and use tax
authorized by RCW 82.14.415 and codified in
Chapter 3.27 of the Kent City Code, relating to the
cost of providing municipal services to the Panther
Lake Annexation Area for the 2014 fiscal year, and
authorizing the Finance Director to certify the
threshold amount to the Washington State
Department of Revenue.
RECITALS
A. RCW 82.14.415 authorizes the City to impose a sales and use
tax as a credit against state retail sales and use taxes collected under
Chapters 82.08 and 82.12 RCW to assist the City in providing municipal
services to newly annexed areas.
B. After providing all appropriate notice and following appropriate
procedure, and following a favorable vote on the annexation proposition,
the Kent City Council adopted Ordinance No. 3936 on December 8, 2009,
approving the Panther Lake Annexation Area effective July 1, 2010. The
population within the annexation area determined at the time of
annexation was 25,458 people.
1 Tax Credit Threshold
Panther Lake Annexation
C. On February 16, 2010, the City Council passed Ordinance No.
3947, creating Chapter 3.27 of the Kent City Code and imposing the sales
and use tax at the rate of 0.2 percent.
D. On February 15, 2011, the City Council adopted Resolution
No. 1839 confirming the tax rate at 0.2 percent and authorizing the finance
director to certify the threshold amount for the 2011 fiscal year.
E. On February 7, 2012, through Resolution No. 1853, the City
Council adopted a new threshold amount for the 2012 fiscal year and
authorized the finance director to certify the same.
F. On February 19, 2013, through Resolution No. 1871, the City
Council adopted a new threshold amount for the 2013 fiscal year and
authorized the finance director to certify the same.
G. With this Resolution, the City authorizes the imposition of
similar annexation sales and use taxes for the 2014 fiscal year.
H. The City Council of the city of Kent, Washington, finds and
determines that the projected cost to provide municipal services to the
Panther Lake Annexation Area for the 2014 fiscal year will be at least
$11,949,899, and that this cost exceeds the projected general revenue
that the City would otherwise receive from the annexation during the 2014
fiscal year, which is estimated to be $7,719,122.
I. Pursuant to RCW 82.14.415, the city of Kent is authorized,
under the circumstances of this annexation, to impose a sales and use tax
for the 2014 fiscal year, which shall be collected by the State department
of revenue from those persons who are taxable by the state under
2 Tax Credit Threshold
Panther Lake Annexation
Chapters 82.08 and 82.12 RCW, upon the occurrence of any taxable event
within the City.
J. The rate of tax imposed shall be 0.2 percent, and shall be in
addition to other taxes authorized by law, and the threshold amount for the
2014 fiscal year is $4,230,777.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON, DOES HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Rate and Threshold Amount. The Kent City Council
determines that the threshold amount for the City's projected net cost in
providing municipal services to the Panther Lake Annexation Area for the
2014 fiscal year is $4,230,777. The City Council previously imposed a sales
and use tax at the rate of 0.2 percent, with the passage of Ordinance No.
3947 on February 16, 2010.
SECTION 2, - Implementation and certification. The Mayor of the
city of Kent is authorized to implement administrative procedures as may
be necessary to carry out the provisions of this resolution. The City's
Finance Director is authorized to certify the amount for the 2014 fiscal year
to the appropriate agencies within the State of Washington.
SECTION 3, - Severability. If any section, subsection, paragraph,
sentence, clause or phrase of this resolution is declared unconstitutional or
invalid for any reason, such decision shall not affect the validity of the
remaining portions of this resolution.
3 Tax Credit Threshold
Panther Lake Annexation
SECTION 4, - Savings. Resolution No. 1871 shall remain in full
force and effect until the effective date of this resolution.
SECTIONS. - Ratification. Any act consistent with the authority
and prior to the effective date of this resolution is hereby ratified and
affirmed.
SECTION 6, - Corrections by City Clerk or Code Reviser. Upon
approval of the City Attorney, the City Clerk and the code reviser are
authorized to make necessary corrections to this resolution, including the
correction of clerical errors; references to other local, state or federal laws,
codes, rules, or regulations; or resolution numbering and
section/subsection numbering.
SECTION 7, - Effective Date. This resolution shall take effect and
be in force immediately upon its passage, however the imposition of the
sales and use taxes for the 2014 state fiscal year authorized by this
resolution shall not take effect until the commencement of that fiscal year.
PASSED at a regular open public meeting by the City Council of the
city of Kent, Washington, this day of 2014.
CONCURRED in by the Mayor of the city of Kent this day of
2014.
SUZETTE COOKE, MAYOR
4 Tax Credit Threshold
Panther Lake Annexation
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR "PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the City Council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK
P:\Civil\I solution\Mnexadon Sales Tax Threshold2014.docx
5 Tax Credit Threshold
Panther Lake Annexation
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KENT
Agenda Item: Consent - 7G
TO: City Council
DATE: February 4, 2014
SUBJECT: Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. - Authorize
MOTION: Authorize the Mayor to sign a contract with Petersen Brothers
Construction, Inc. to perform emergency repairs of damaged guardrails on
an as needed basis in an amount not to exceed $20,000, subject to final
terms and conditions acceptable to the City Attorney and Public Works
Director.
SUMMARY: The city typically has several guardrails that are damaged or destroyed
each year by vehicles due to severe weather or inattentive drivers. In the past we
have spent time soliciting bids for each repair. Petersen Brothers is the only business
that consistently responds and at this time is the sole provider for this service in the
region.
We are requesting the approval of this contract to be able to expedite repairs.
EXHIBITS: None
RECOMMENDED BY: Public Works Committee
YEA: Berrios - Ralph - Higgins NAY:
BUDGET IMPACTS: Funds would be made available by Council through the use of
Business and Occupation Tax.
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KENT
Agenda Item: Consent - 7H
TO: City Council
DATE: February 4, 2014
SUBJECT: 2013 Crack Sealing Project Completion - Accept
MOTION: Accept the 2012 Crack Sealing Project as complete and release
retainage to C.R. Contracting, upon receipt of standard releases from the
state and the release of any liens.
SUMMARY: Crack sealing is a maintenance treatment used to prevent water from
infiltrating cracks in a roadway. When water infiltrates cracks, it leads to accelerated
damage of the roadway. Historically, Public Works Operations crews have performed
crack sealing. Our crews still perform a significant amount of crack sealing work
annually; however, the volume of work has exceeded the time available for in-house
personnel. Therefore, several roadways in the valley were identified to have crack
sealing performed by a Contractor. The original contract amount was $195,300.00.
The final contract amount was $194,194.70.
The project consisted of installing approximately 18 tons of rubberized asphalt for
crack sealing on Central Avenue South, West Valley Highway, 84th Avenue South, 64th
Avenue South, Meeker Street and several industrial streets in the northwest corner of
the city.
The contract is now complete and ready for Council acceptance.
EXHIBITS: None
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS: This project was funded from the Business & Occupation tax
revenue.
This item did not need to be brought to Committee.
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KENT
Agenda Item: Consent - 7I
TO: City Council
DATE: February 4, 2014
SUBJECT: Oakleigh I & II Bill of Sale- Accept
MOTION: Accept the Bill of Sale for the Oakleigh I & II project, permit
2071420, for 28 gate valves, 5 hydrants, and 3,816 linear feet of waterline;
17 sanitary sewer manholes, and 2,747 linear feet of sanitary sewerline;
384 linear feet of new curb and gutter, 272 linear feet of new sidewalk, 2
street lights, and 6 street trees; 1 storm sewer catch basin, and 320 linear
feet of storm sewerline.
SUMMARY: The Oakleigh I & II project is located at 27919 106th Ave. SE; parcel
#3222059089.
EXHIBITS: Oakleigh I & II Bill of Sale
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS:
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MAIL TO:
CITY OF KENT
ENGINEERING DEPARTMENT
ATTN: Ozzie Carrasquilla
�Aj 220 — 4T" AVENUE SOUTH
WASH IN a T O a KENT, WASHINGTON 98032
Project: Oakleigh I & II
CITY OF KFNT Permit #:_RECC-2071420
JUN Q 5 201.E Location: 108" Avenue SE at SE 279th Street
ENGINEERING UEP I Parcel #: 322205-9094. -9089. -9095, -9122, -9137
BILL OF SALE
CITY OF KENT
KING COUNTY, WASHINGTON
THIS INSTRUMENT made this 12th day of April 2013, by and between Henley USA LLC, hereinafter
called "Grantors", and City of Kent, a municipal corporation of King County, State of Washington, hereinafter
called
"Grantee":
WITNESSETH:
That the said Grantors for a valuable consideration does hereby grant, bargain, sell to Grantee the following
described improvements:
A. WATERMAINS:
Together with a total of 28 gate valves at $800.00 each, 5 hydrants at $4,200 each and/or any other
appurtenances thereto.
ON FROM TO
SE 2Both Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
1071h Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 3,816 linear feet at $42.00 per LF of 8" D.I. waterline, and
300 linear feet at $50.00 per LF of 12" D.I. waterline.
Bill of Sale 14369.036.doc
1of5
B. SANITARY SEWERS:
Together with a total of 17 manholes at $3,200.00 each and/or any other appurtenances thereto.
ON FROM TO
SE 2801h Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
107" Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 2,747 linear feet at $38.00 per LF of 8" PVC sewerline, and
611 linear feet at $50.00 per LF of 12" PVC sewerline.
C. FRONTAGEIMPROVEMENTS:
Together with lights, trees, landscaping (except residential streets) and/or any other appurtenances
ON FROM M
1081h Avenue SE SE 279th Street SE 278t" Street
Including 384 linear feet at $8.00 per LF of concrete curb and gutter, and
272 linear feet at $12.00 per LF of 6-foot concrete sidewalk, and
2 street lights at $6,500.00 each, and
6 street trees at $300.00 each.
D. STORM SEWERS:
Together with a total of 5 Type I catch basins at $950.00 each, and/or any other appurtenances
thereto.
ON FROM TO
1081h Avenue SE SE 279th Street SE 278th Street
Including 320 linear feet at $28.00 per LF of 12" PVC sewerline.
To have and to hold the same to the said Grantee, its successors and assigns forever.
The undersigned hereby covenants that it is the lawful owner of said property; and that the same is free
from all encumbrances; that all bills for labor and materials have been paid; that it has the right to sell the
same aforesaid; that it will warrant and defend the same against the lawful claims and demand of all
person(s).
The Bill of Sale is given on consideration of the agreement of the Grantee for itself, its successors and
assigns to incorporate said utilities in its utility system and to maintain them as provided in the applicable
City Ordinances. The City accepts the items subject to staff approval and completion of a 2 year
maintenance period.
Bill of Sale 1436e.036.doc
2of5
IN WITNCEESS WHEREOF, the undersigned has caused this instrument to be executed on this
L t day of 2013.
��V v,-..L,'f'\'Jv-- i=`�- L-Li.u1.C�; N'lfi,Vtet.�a• r�:,_�'._.. '..
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed on this
day of 2013,
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this day of 2013, before me, .the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared to me known to be the individual described in and
who executed the foregoing instrument, and acknowledged to me that he/she signed and sealed this
instrument as his/her free and voluntary act and deed for the uses and purposes therein mentioned.
GIVEN under my hand and official seal this day of 2013.
Notary Public in and for the State of
Washington, residing at
My Commission Expires:
Bill of Sale 14369.036.doc
3 of 5
i
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this is day of Y 2013, before me, the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared f�t' t (`--&A1/e-// and to me to be the
PJ �c�P (,.bvo6 4d" d respectively of
FiR/ � dA the�7G�M ;,Ce®/ G>'40,IAX l"rx that executed the foregoing
instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said
Gf-C for the uses and purposes therein mentioned, and on oath stated that
they are authorized to execute the said instrument.
Witness my hand and official seal hereto affix the day and year first above written.
�449bRSGilytrid�,��
�«•�@i,�Qp1NTih�ry,„•.,/Js�se. ,€ll .�' .l.�s�iwr �
:0°4. Notary Public IW and for the ate of
*, 30 w.Z_ Washington, residing at
2014
?BeR AitP16 �0`��`` My Commission Expires:
The Bill of Sale is given and accepted pursuant to a motion duly made, seconded, and passed by the City
Council of the City of Kent, King County, Washington, on the day of
2013.
Bill of Sale 14369.036.doc
4of5
FO
i
WASHINGTON it
ENGINEER'S CERTIFICATION
CITY OF KENT
KING COUNTY, WASHINGTON
The figures used on the Bill of Sale for the Oakleigh I and II project dated April 12,
2013, for the same said Oakleigh I and II project. Chris Jensen, the undersigned
P.E. or land surveyor is the person responsible for the preparation of the Bill of Sale and
is an employee of Barghausen Consulting Engineers, Inc., the firm responsible for
the preparation of the record drawings.
�R1S JEFys�
evA �C
O 4 11111�
Sigr ature
(Engineer stamp required)
Bill of Sale 14369.036.doc
5of5
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KENT
Agenda Item: Other Business — 8A
TO: City Council
DATE: February 4, 2014
SUBJECT: Financial policy Resolution - Adopt
MOTION: Move to adopt Resolution No. , repealing Resolution No.
1859, amending financial policies to be used for guidance when enacting
and amending the city budget.
SUMMARY: This resolution amends the city's financial policies by clarifying the
requirements and available uses for the city's Strategic Opportunities Fund, first, by
confirming that non-recurring revenues only be applied to non-recurring expenses,
and second, by confirming that monies will not be spent out of this fund unless the
council first approves the expenditure.
Additionally, we have added a new, aspirational goal designed to obtain exceptional
financial stability by increasing our total government fund balance to a point where it
should carry the city through future economic downturns.
EXHIBITS: Resolution and Exhibit
RECOMMENDED BY: Operations Committee
YEA: Thomas — Ralph — Boyce (post meeting) NAY:
BUDGET IMPACTS: None
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RESOLUTION NO.
A RESOLUTION of the city council of the
city of Kent, Washington, repealing Resolution
1859 and adopting financial, accounting, and
budgetary policies intended to provide short and
long-term guidance to city staff for the purpose of
achieving financial stability and achieving goals
established in the City Council's Strategic Plan.
RECITALS
A. As the council developed its strategic plan, it also created a new set
of financial, accounting and budgetary policies that are intended to offer
short and long-term guidance to city staff as the city moves toward
accomplishing the goals established in the strategic plan. The council
adopted these financial policies by resolution on June 5, 2012.
B. Since implementing these policies, the council has determined that
certain policies, such as the policy pertaining to the city's "Strategic
Opportunities Fund," need clarification. Further, in order to be best
prepared for future economic downturns, the policies have been amended
to add an aspirational goal of building a solid financial reserve for all city
funds.
C. Just as the strategic plan reflects goals and a vision the city strives
to achieve, these amended policies reflect the financial goals and vision for
the city. Accordingly, the council implements these policies today with the
1 Financial Policies Resolution
understanding that not all goals can be achieved immediately, but rather
will be achieved over time.
THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES
HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Recitals. The foregoing recitals are incorporated by
this reference.
SECTION 2, - Repealer. Resolution No. 1859, adopted on June 5,
2012, is repealed in its entirety.
SECTION 3, - Policies Adopted. The city of Kent Financial Policies
attached as Exhibit A are adopted.
SECTION 4, - Severabilitv. If any one or more section, subsection,
or sentence of this resolution is held to be unconstitutional or invalid, that
decision shall not affect the validity of the remaining portion of this
resolution and that remaining portion shall maintain its full force and
effect.
SECTION S. - Effective Date. This resolution shall take effect and
be in force immediately upon its passage.
PASSED at a regular open public meeting by the city council of the
city of Kent, Washington, this day of 2014.
SUZETTE COOKE, MAYOR
2 Financial Policies Resolution
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR 11PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the city council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK (SEAL)
P:\Civil\Pesolution\financial Policies 2014.docx
3 Financial Policies Resolution
FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves — The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund — The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise. For the
purposes of this section, "investment opportunities" includes expenditures intended to
increase city revenues or decrease operating or capital costs. To the extent the balance in this
fund is not from a recurring revenue source, it should only be utilized for a non-operating
purpose or one time expenditure. In addition, any appropriation from this fund must first be
approved by the City Council. In the event any of this fund is used in an economic downturn to
stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projects or capital projects that reduce
recurring operational expenditures. This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs — The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of $1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its $1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational goal, the City shall maintain a
total governmental fund balance of twice the greatest volatility in year over year changes in
total revenues or $30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
Exhibit A
OPERATING BUDGET POLICIES
City Target Issues-The City Council will update its strategic plan in the early spring of each year. The
staff will use this plan for development of the following year's budget priorities and the next biennial
budget.
Budget Kickoff—The Mayor and City Council shall meet in the Spring of even numbered years to plan
the following biennial budget and agree on the anticipated revenues on which the preliminary budget will
be based. The City Council shall review revenue estimates and preview potential changes to revenues.
The City Council shall then approve the revenue amount that will be used by the Mayor to form the initial
preliminary budget. The Mayor and City Council will meet additionally in late Summer to re-review the
revenue estimates to adjust them more closely to the additional revenue information that has become
available with the passage of time. Any changes resulting from this meeting shall be incorporated into
the preliminary budget to be considered by City Council.
Program Reviews — The Mayor shall perform a periodic review of staff and programs of the City for
both efficiency and effectiveness.Alternate methods of delivery will be evaluated for providing services.
Programs that are determined to be inefficient, ineffective, or inconsistent with the City Council's
strategic goals shall be reduced in scope or eliminated.
Preliminary Budget — The Mayor shall propose a preliminary budget in the Fall of even numbered
years. The preliminary budget will be developed in accordance with the revenues approved by the City
Council at the budget kickoff as amended. If the preliminary budget is based on revenues in excess of
those approved by City Council,the Mayor will present the justification for the increased revenues or the
additional proposed revenue sources.
Structurally Balanced Budget—The Mayor shall present, and the City Council shall adopt a budget in
which ongoing revenues equal or exceed ongoing expenditures. One time revenues shall not be used
to pay for recurring expenditures.
Conservative Expenditure Budgeting-The City will maintain its conservative expenditure budgeting
with respect to budgeting existing full time positions for a full year.
Acceptance of Grants —The City shall review any requirements for ongoing costs from any grant for
operational purposes. Any requirement to fund any portion of the costs as a condition of receipt of the
grant shall be a consideration in the decision to accept or reject the grant.
Self Supporting Proprietary Funds-The City's water, sewer and golf course enterprise funds will be
self supporting along with its internal service funds. The cost of providing services is expected to be
fully funded from charges for the service. If the funds produce a loss, rates will be adjusted to achieve,
at minimum, a break even status. If debt has been issued which requires a certain level of return, rates
and charges will be adjusted to achieve those returns.
Health Insurance Reserves — The target reserve for the Health Insurance Fund shall be two times
IBNR.
Full Cost of Service — The City will define its basic services to our residents. The services will be
evaluated as to their full cost. This information will be incorporated and presented as a section of the
annual budget.
Exhibit A
REVENUE AND COLLECTIONS
Aggressive Collection Effort- The City will follow an aggressive policy of collecting all monies due the
City to the extent that the collection efforts remain cost effective.
Reimbursements on a timely basis—Many grants occur on a cost reimbursement basis. To maximize
the City's available investable funds, reimbursement should be pursued on a timely basis.
User Charges Related to Costs - The City will review fees and charges on an annual basis and will
modify charges to adequately keep pace with increasing costs of providing services.
User Charges and Taxes Related to Market Rates- The City will consider its user charges and its tax
rates in connection with those of comparable sized communities and similar service providers, so that it
will provide reasonable rates to maintain its advantage in the market place in attracting businesses and
residences to the City of Kent.
CAPITAL BUDGETING
Committed Special Revenue Funds - The City will maintain its practice of designating its street and
capital improvement revenue sources including a percentage of its sales tax collections for the funding of
its capital improvement program.
Capital Improvement Program - The City will update its capital facilities plan on an annual basis as
required by the Growth Management Act. A preliminary plan will be established early in the budgeting
process to serve as a guideline during the year,with a final amendment adopted with the adoption of the
operating budgets to reflect the necessary changes in the City's Comprehensive Plan.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should issue
debt only for major capital projects. Debt should only be authorized for projects where the life of the
asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments on
outstanding debt shall be the highest priority before payment for other capital expenditures.
Bond Rating-The Citywill continue to strive to improve its bond rating by improving its financial stability.
Debt Capacity - The City strives to maintain adequate available debt capacity for large top priority
projects.
Bonding Limitations— Direct General Obligation Debt will not exceed 1.5% of assessed value; direct
and indirect debt will not exceed 4% of assessed value; duration of the debt will not exceed 15 years.
Revenue Debt Covenants—Will be based on the volatility of the revenues.
Arbitrage regulations—Will be strictly followed.
Special Assessment Guaranty Fund-The City will strive to maintain adequate reserves for retirement
of special assessment debt through the maintenance of a special assessment guaranty fund at least 10%
of outstanding special assessment debt.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost effective to
both the borrowing and the lending fund, and the funds will not be needed by the loaning fund during the
term of the loan. Such borrowing shall implement Council directed policy in a simplified manner, such as
borrowing associated with interim financing for local improvement district projects. A repayment plan
Exhibit A
should be approved along with the loan. The Mayor may approve loans for a term of one year. The
Council must approve loans with terms longer than one year.
INVESTMENT POLICY
Investment Security&Earnings Maximization-An investment policy was implemented per Ordinance
#3278 in 1996 which detail the City's investment guidelines. The primary objective is to preserve the
principal of the investment portfolio while maximizing the portfolio's return.
FINANCIAL REPORTING
Reporting frequency — Monthly budget and actual reports will be available to departments and a
quarterly report will be presented to the City Council Operations Committee.
Annual Report—Will be completed within 180 days.
Reporting Improvements-The City will strive to continue to make improvements in its financial reporting
scheme so that information available to the public,the City's governing bodies and other city departments
is timely and the best available for sound financial decisions.
Bondholders'Report— The City will prepare an annual report to bondholders.
Full Disclosure—All public reports will contain full and complete disclosure of all material matters.
Financial Trend Monitoring - The City will develop a program to evaluate its financial condition and
establish a system for correcting any deficiencies noted.
Annual Audits - The City will assist the State Auditor's Office in whatever way possible in conjunction
with the preparation of the annual audit,and will implement modifications identified bythe State Auditorto
improve the City's internal control and financial practices.
Updates to these Policies—The Operations Committee of the City Council shall review these policies at
least every four years. It is recommended that the review is done biennially during the budget process.
Exhibit A
ACCOUNTING
Generally Accepted Accounting Principles-The City will maintain its position as a leader in producing
financial reports in conformance with generally accepted accounting principles and pronouncements by
the Governmental Accounting Standards Board.
Basis of Accounting - The basis for accounting for the general fund, special revenue, debt service,
capital projects and agency funds is modified accrual. Modified accrual recognizes revenues when they
become both measurable and available to finance expenditures of the current period. The basis of
accounting forthe enterprise, internal service funds and pension trustfund is full accrual. The appropriate
basis is used throughout the budgeting, accounting and reporting processes, with few exceptions as
noted below. Full accrual is a method of accounting that matches revenues and expenses with the period
to which they relate, rather than focusing on actual cash flows. In this method, for example, an asset is
depreciated as it is "used up", and the expense is recognized in periodic increments, rather than
assuming the asset holds its value until it is actually disposed of. However, since the focus in budgeting
is on the revenues and expendable accounts, depreciation and amortization are not considered budgetary
accounts, and are excluded from the budgeting system. Likewise, debt service and capital expenditures
are presented as the payments occur, departing from GAAP in this regard, in the budget document. Also,
Trust and Agency Funds that may not be expended for governmental operations are excluded from this
budget document.
The presentation of the program budget departs from the basis of the legal budget by eliminating inter city
transactions and allocating the net increases or decreases from internal services to the using programs.
This is done to give the user a more complete picture of the total costs of the operating programs.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
The City of Kent, as all governmental units, operates its budget and accounting system based on a fund
structure. Funds are established to segregate specific revenue to ensure their expenditure within
applicable legal and contractual provisions. Revenues are allocated to and accounted for in individual
funds based on the purposes for which they are to be spent and the means by which the spending
activities are to be controlled. The City of Kent operates with seven basic fund types. Within each fund
type there may exist one or more individual funds. The City of Kent operates with 26 individual funds.
The fund types are listed below under their three major subheadings.
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
GOVERNMENTAL FUNDS
General Fund
The General Fund is the principal operating The General Fund "buys" services from the
fund of the City. It accounts for the financial Internal Service Funds: fuel and rental of
resources of the City which are not accounted vehicles from the Equipment Rental Fund;
for in any other fund. Principal sources of supplies, postage, photocopy, printing and
revenue are property taxes, sales and use graphics, cable TV services, data processing
taxes, utility taxes, licenses and permits, state and telephone services from Central Services;
shared revenues, charges for services and facility maintenance and operation services
interest income. Primary expenditures are for from Facilities; and insurance from the
general City administration, police and fire Insurance Fund. Costs are allocated to all
protection, engineering and planning services, funds in an effort to distribute accounting,
park and street maintenance, and cultural and budgeting, legal and human resource services
recreational services. as well as street, engineering and park
services. General Fund also transfers funds for
minor projects.
Special Revenue Funds
Special Revenue Funds are used to account for Taxes and grants are collected in the Street
specific revenue sources that would otherwise Fund, LEOFF1 Retirees Fund, Lodging Tax
be accounted for in the General Fund, but for Fund, Youth Teen Programs Fund, Capital
which there exists certain legal restrictions as to Improvement Fund, Criminal Justice Fund,
the use of certain revenues. The revenue is Community Development Block Grant Fund,
segregated into individual special revenue funds Other Operating Projects Fund, and the Kent
to ensure expenditure for a designated purpose. Events Center Operating Fund. Transfers from
Principal sources of revenue are: state shared the Street and Capital Improvement Funds are
fuel tax, earmarked sales and utility taxes and primarily to the Capital Project Funds or the
community development block grant funds. The LTGO Debt Service Fund.
major portion of these resources are transferred
to other funds for debt retirement, capital
acquisition and specific purposes operations.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Debt Service Funds
Debt Service Funds are used to account for the The Debt Service Funds receive the transfers
accumulation of resources to be used for the from the Special Revenue Funds, Water Fund
retirement of general long-term debt. The City and Sewerage Funds to pay principal and
has three types of general long-term debt for interest on LTGO debt issues.
which resources are accumulated: general
obligation long-term debt (voted, general
obligation long-term debt and LTGO)and special
assessment debt. Sources of revenue to fund
the retirement of general obligation long-term
debt are property taxes and transfers in from
other funds. Special assessments are levied
and received to retire special assessment debt.
Capital Projects Funds
Capital Projects Funds are used to account for Transfers are received from Special Revenue
the financing of major one time only capital and other funds as a partial source of funds
projects other than those financed by Proprietary needed to complete projects.
Funds. Sources of revenue are: proceeds of
debt issuance, grants, and transfers from other
funds.
PROPRIETARY FUNDS
Enterprise Funds
Enterprise Funds are used to account for the The Enterprise Funds "buy" services from the
financing of services provided to the general Equipment Rental Fund for equipment rental and
public where all or most of the costs involved are fuel; from the Insurance Fund for insurance
paid for by user charges. Operations financed needs; from the Central Service Funds for
as enterprise funds are operated in a manner stores, telephone, postage, photocopying,
similar to private business enterprises. Kent's printing and graphics, cable TV services, data
enterprise funds are funded through water, processing and telecommunications; and from
sewer, and drainage utility charges and the Facilities Fund for facility maintenance and
recreational charges at the City's golf complex. operation services. The Enterprise Funds also
reimburse the General Fund for cost allocations
for budgeting,accounting, human resource, legal
and engineering costs which relate to Enterprise
Funds. Other funds purchase utilities at the
same rate as the general public.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Internal Service Funds
Internal Service Funds are used to account for Centralizes costs for equipment rental, central
the financing of specific services performed by services and insurance. These services are
designated organizations within the City for "sold" to other funds at cost plus a reserve for
other organizations within the City. The City's future needs.
Equipment Rental, Central Service, Facilities
Maintenance and Planning, and Insurance
Funds provide centrally administered services
then generate revenue by billing the
organization to which the service is provided.
FIDUCIARY FUND TYPES
Trust and Agency Funds
Trust and Agency Funds are used to account
for assets held by the City as trustee or agent
for individuals, private organizations or other
governmental units. Since their funds are not
expendable for City operations they are not
included in the budget. However, per state
auditor requirements, estimates are provided
for their activities.
Exhibit A
BUDGET AND SPENDING CONTROL SYSTEM
Budgets serve as control mechanisms in the operations of governmental units. Legal budgetary
(expenditure) control in the City of Kent is maintained at the fund level. Administration can amend
budgets, with no overall dollar increase between departments, within a fund. Supplemental
appropriations that amend total expenditures, or in the case of Proprietary Funds amend working
capital, require a City Council ordinance. All operating budgets lapse at the end of the biennium.
Within each year of the biennium, a single year allocation will be adopted and operate as if it were
an annual budget.
General and Special Revenue Funds control expenditures with a legal biennial budget at the fund
level. Debt Service Funds operate under the control of the bond indentures which established
them. Capital Projects Funds operate under the control of total project authorization, rather than the
annual budget. Proprietary Funds control expenditures with a flexible budget whereby the
expenditure increases must be offset by increased resources. Though budgetary control is at the
fund level, budget and actual information is maintained by project, organization, program and
object. Both budget and actual information is presented on a GAAP basis of accounting, when
presented by fund.
The City must adopt its biennial budget by December of the preceding fiscal year. This usually
follows six months of analysis by staff and City Council. The first step involves the establishment of
the baseline revenue budget by the City Council. The second step is to review the City Council
Strategic Goals and begin budget development to assist in achieving those goals.Third, undertake
a program review to ensure that current program offerings are in agreement with City Council goals
and priorities. The emphasis is placed on the General and Special Revenue Funds since the
operation of other funds are tied to ordinances, contractual agreements or separately established
rate structures. Once the baseline operations have been reviewed and adjusted based on
administrative policy, program expansion is included to the level of projected available resources
after the establishment of sufficient fund balances.
A mid-biennium review is undertaken during the second year of the biennium in which any changes
to the initial estimates of revenues and expenditures are to be reviewed. Such changes will be
presented by the Mayor and discussed by the City Council. Any agreed upon changes shall be
approved with an ordinance adopting changes to the biennial budget.
After the preliminary budget document is prepared, the City Council spends approximately one
month reviewing it. Public meetings are held to gather public input. When the budget review and
final adjustment period is complete a balanced budget as required by state law is adopted by
ordinance. After adoption, periodic budget adjustments that affect total fund expenditures are made
as approved by City Council, but a final budget adjustment ordinance covering all approved
changes is adopted at year end or the beginning of the next biennium.
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FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves—The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund —The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise ..
AsTo the extent ,
this fund _"a" GAIY be 61t I Zed
Lhen
the
first a roved b City Council. In the event any of this funds used inlanfeco omit dovvnt is
pp y y y wnturn
to stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projectsr
This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs—The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of$1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its$1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational coal, the City shall maintain a� Formatted:Font:Bold
total governmental fund balance of twice the greatest volatility in year over year changes in Formatted:Indent:Left: 0.12"
total revenues or$30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds—The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service—To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
BIDS
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REPORTS FROM STAFF, COUNCIL COMMITTEES, AND SPECIAL COMMITTEES
A. Council President
B. Mayor
C. Administration
D. Economic & Community Development
E. Operations
F. Parks & Human Services
G. Public Safety
H. Public Works
I. Regional Fire Authority
J. Other
K. Other
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EXECUTIVE SESSION
ACTION AFTER EXECUTIVE SESSION
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CITY OF KENT
City Council Meeting
Agenda
I�� mt U r rt
r
m
February 4, 2014
Mayor Suzette Cooke
Darla Ralph, Council President
Couneilr embers
Jim Berrios
Bill Boyce
Dennis Higgins
Deborah Ranniger
Les Thomas s
we
CIFY CLERK
y �
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KENT CITY COUNCIL AGENDAS
KENT February 4, 2014
w s v ro Council Chambers
Mayor Suzette Cooke
Council President Dana Ralph
Councilmember Jim Berrios Councilmember Bill Boyce
Councilmember Dennis Higgins Councilmember Deborah Ranniger
Councilmember Les Thomas
*********************************************************************
SPECIAL COUNCIL WORKSHOP AGENDA
5:00 P.M.
Subiect Speaker Time
2014 Top Departmental Issues Tom Brubaker 90 min
COUNCIL MEETING AGENDA
7:00 p.m.
1. CALL TO ORDER/FLAG SALUTE
2. ROLL CALL
3. CHANGES TO AGENDA
A. FROM COUNCIL, ADMINISTRATION, OR STAFF
B. FROM THE PUBLIC — Citizens may request that an item be added
to the agenda at this time. Please stand or raise your hand to
be recognized by the Mayor.
4. PUBLIC COMMUNICATIONS
A. Public Recognition
B. Community Events
C. Introduction of new Arts Commission Appointee, Lynn Bohart
D. Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E. Intergovernmental Reports
5. PUBLIC HEARINGS
6. PUBLIC COMMENT
7. CONSENT CALENDAR
A. Minutes of Previous Meetings and Workshop — Approve
B. Payment of Bills — Approve
C. Appointment to Arts Commission — Confirm
D. Appointments to Land Use and Planning Board - Confirm
(Continued)
COUNCIL MEETING AGENDA CONTINUED
E. Refunding 2004 Limited Tax General Obligation Bond Ordinance —
Adopt
F. Budget Certification for Annexation Sales Tax Credit Resolution —
Adopt
G. Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. — Authorize
H. 2013 Crack Sealing Project Completion — Accept
I. Oakleigh I & II Bill of Sale- Accept
8. OTHER BUSINESS
A. Financial policy Resolution - Adopt
9. BIDS
10. REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
11. EXECUTIVE SESSION AND ACTION AFTER EXECUTIVE SESSION
12. ADJOURNMENT
NOTE: A copy of the full agenda packet is available for perusal in the City Clerk's
Office. The Agenda Summary page and complete packet are on the City of
Kent web site at www.KentWa.gov
An explanation of the agenda format is given on the back of this page.
Any person requiring a disability accommodation should contact the City Clerk's Office
in advance at (253) 856-5725. For TDD relay service call the Washington
Telecommunications Relay Service at 1-800-833-6388.
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CHANGES TO THE AGENDA
Citizens wishing to address the Council will, at this time, make known the
subject of interest, so all may be properly heard.
A) From Council, Administration, or Staff
B) From the Public
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PUBLIC COMMUNICATIONS
A) Public Recognition
B) Community Events
C) Introduction of new Arts Commission Appointee, Lynn Bohart
D) Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E) Intergovernmental Reports
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PUBLIC HEARING
This page intentionally left blank.
PUBLIC COMMENT
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Agenda Item: Consent Calendar 7A - 7B
CONSENT CALENDAR
7. City Council Action:
Councilmember moves, Councilmember
seconds to approve Consent Calendar Items A through E.
Discussion
Action
7A. Approval of Minutes.
Approval of the minutes of the workshop and regular Council meeting of
December 10, 2013.
7B. Approval of Bills.
Approval of payment of the bills received through November 30 and paid on
November 30 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
11/30/13 Wire Transfers 5684-5694 $1,148,142.13
11/30/13 Regular Checks 678482-678852 $3,165,660.16
Void Checks ($104.90)
11/30/13 Use Tax Payable $1 290.72
$4,314,988.11
Approval of payment of the bills received through December 15 and paid on
December 15 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/15/13 Wire Transfers 5695-5714 $2,044,626.90
12/15/13 Regular Checks 678853-679223 $2,045,487.95
Void Checks ($0.00)
12/15/13 Use Tax Payable $1 414.29
$4,091,529.14
Approval of payment of the bills received through December 31 and paid on
December 31 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/31/13 Wire Transfers 5715-5727 $1,375,632.00
12/31/13 Regular Checks 679224-679539 $3,099,891.45
Void Checks ($675.00)
12/31/13 Use Tax Payable $162.74
$4,475,011.19
Approval of checks issued for payroll for November 16 through November 30 and
paid on December 5, 2013:
Date Check Numbers Amount
12/5/2013 Checks 333708-333824 $ 91,543.70
Voids and Reissues
12/5/2013 Advices 322206-322830 1,569,071.57
$1,660,615.27
Approval of checks issued for payroll for December 1 through December 15 and
paid on December 20, 2013:
Date Check Numbers Amount
12/20/2013 Checks 333825-333949 $ 77,667.53
Voids and Reissues
12/20/2013 Advices 322831-323460 1,299,170.40
$1,376,837.93
Approval of checks issued for payroll for December 16 through December 31 and
paid on January 3, 2014:
Date Check Numbers Amount
1/3/2014 Checks 333950-334083 $ 66,870.91
Voids and Reissues
1/3/2014 Advices 323461-324081 1,251,884.88
$1,318,755.79
11 � KENT
Kent City Council Workshop
January 21, 2014
The meeting was called to order at 5:30 p.m. by Council President Ralph.
Councilmembers present: Ralph, Berrios, Higgins, Ranniger, and Thomas
Council President Ralph discussed the application process for the Council vacancy. She
highlighted how to apply and verified that the Council would review applications at a
special meeting on February 11, 2014 at 6:00 p.m.
Council Retreat Dates — Council President Ralph communicated that the Council
Retreat would be March 21 and 22 at the Green River Community College.
Councilmember Ranniger suggested an email be sent to Councilmembers.
IS 402 Training - Dominic Marzano, Emergency Management Director discussed IS-
402. He communicated that it is a class for executives and senior officials (policy
makers) and trains them how to better manage events and make policy decisions. He
noted that best practices will also be communicated in the class. He noted that the
class is for South King County officials and urged Council participation in the class. He
also communicated that he will be speaking to MLT next Monday concerning a class
for them because of some new equipment in the emergency communication center
(ECC).
Councilmember Higgins verified that the training is February 12 from 6:00 p.m. to
8:00 p.m.
Marzano also suggested that the Mayor bring the Acting City Attorney to the class to
go over policy decisions.
Council President Ralph communicated that she felt this would be a good opportunity
for the Council. She said there is a lot involved and this is a detailed process. She
noted that at the South County Area Transportation Board meeting there was a
discussion about what cities have set up in case of an oil spill because of the increase
of oil tanker ships in the Puget Sound. Marzano confirmed that the City does have a
plan set up.
B&O Tax Amendments — Robert Nachlinger, Finance Director discussed the
preliminary amendments to the B&O tax ordinance. He communicated that it was
adopted a little over a year ago and the City has received about three quarters of the
projected revenues. He noted that there is an inconsistency between local codes and
that has caused confusion to firms who have to file B&O in numerous cities. He
reviewed Bellevue, Seattle, and Tacoma's exemptions and said staff proposes to
exempt all 501(c) organizations to include homeowner associations, unions, fraternal
organizations, and others who are not engaging in retail activities.
Councilmember Higgins verified that there are a couple of organizations that are
501(c) status that engage in retail sales such as Goodwill and Children's Hospital.
Kent City Council Workshop Minutes January 21, 2014
Councilmember Ranniger inquired about the financial impact and Nachlinger replied
that it would be about $25,000 per year.
Nachlinger continued and discussed filing status and frequency. He noted that having
all firms file quarterly this first year has provided the City with data. Almost 1,600
firms have paid and 36 percent of them (576) have paid over $1,000 quarterly and
this, he noted makes up 92 percent of the total tax revenues collected. He continued
and said 64 percent have paid less than $1,000 and less than 8 percent of the total
revenues collected. He suggested that the firms who have paid less than $1,000 be
reverted to annual collections based on these numbers.
Discussion continued on how they would be reverted to annual collections and
Nachlinger communicated that the Finance Department could send them a letter
communicating this. He also stated that the staff did not recommend having a "non-
filing status" so the City could continue to maintain information concerning
businesses.
Councilmember Higgins verified that only Bellevue and Tacoma have a non-filing
option and Nachlinger communicated their amounts.
Councilmember Higgins discussed the administrative expenditures concerning the
B&O tax.
Councilmember Berrios verified the department was down an auditor. He also
confirmed with Nachlinger that they haven't gotten the data concerning most of the
seasonal firms. However, the data should come in February or March.
Council President Ralph verified with Brubaker that an ordinance would be drafted and
brought to Council for adoption.
Council President Ralph stated she is comfortable with this and agreed with the
process of letting businesses know they have been moved to an annual filing status.
Councilmember Thomas suggested the ordinance be retroactive and if they have paid
this past year they have their funds refunded and not penalized. Fitzpatrick
communicated that his staff will look into doing that.
Councilmember Berrios communicated that the process needs to be fair and
accountable. He said the policy needs to be consistent and take into account who paid
and who didn't based on the legislation the Council passed.
Council President Ralph stated that it seems best to stay the course and make
revisions at the end of the year.
Nachlinger stated that there are 145 3PLs and based on the amount of revenues
generated from their B&O tax compared to their square footage tax returns, the
square footage tax amount was 3.5 times their B&O tax amount. He stated that the
B&O is working exactly as it was intended to. He communicated that there is an
argument concerning companies that don't do many deliveries into Kent, but they are
2
Kent City Council Workshop Minutes January 21, 2014
making more money than what is being reported. He stated that the tax is designed
to get some mitigation from companies that destroy the cities roads.
Councilmember Higgins inquired about the federal research and development funds
and Nachlinger communicated that since the City gave an exemption he wasn't sure
how much it was for.
Councilmember Berrios stated that the Chamber discussed that with Boeing and they
didn't know what the number was either.
Council President Ralph verified that they weren't required to report those federal
funds to the City.
Mayor Cooke clarified that the 3PLs aren't seeking an exemption, but a reduced rate
due to the square footage tax compared to their gross revenues that would be with
the B&O tax. She communicated that if the Council decides that they don't want 3PLs
the businesses can easily go to local cities. She recommended the Council look at the
entire picture and realize that the surface isn't equal.
Councilmember Higgins stated these businesses are creating truck traffic so the B&O
tax makes sense. He also added that the other tax seems appropriate, too.
Councilmember Thomas communicated that he would like to remain competetive and
verified with the Mayor that there are ten 3PL companies. Additionally, the Mayor
added that she wasn't sure how much of the product they are storing is from local
businesses.
Councilmember Ranniger stated that there have been challenges with the streamline
sales tax for a while now. She stated the other policy question is whether to rezone
the area to retail. She said that if the City discourages these types of businesses
because of the B&O tax, the City needs to prepare to decide what it wants to see in
those properties.
Council President Ralph questioned if the conversation should be left open or have
these amendments brought forward.
Councilmember Ranniger stated she would like to see the 501(c) exemption be
brought forward and continued discussion on the 3PLs.
Councilmember Berrios confirmed that there were ten CPLs and added that the City
needs to attract and keep current businesses here. He stated he wasn't sure of the
details with the 3PLs. However, he questioned if the City should allow current
businesses to grow in their current space and investigate exemptions to these
businesses. He suggested investigating if the City is collecting the proper amounts
from these businesses.
Nachlinger verified that they are looking for reductions in their rates, not exemptions.
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Kent City Council Workshop Minutes January 21, 2014
Mayor Cooke verified with Council President Ralph that this item should go to the
Economic and Community Development Committee.
Council President Ralph communicated that there is consensus to move the 501(c)
revisions to the Operations Committee.
Councilmember Higgins discussed the Sound Transit proposal for gas taxes which
would end up being $3.1 million to the City of Kent for transportation.
Councilmember Thomas communicated that he is against the item.
Council President Ralph communicated that the King County Council is discussing two
different packages and need to decide before March 7 whether or not to go to a ballot
measure. She added that they are also discussing bus fare increases.
Councilmember Higgins communicated that he felt the item is likely to pass county
wide and $3.1 million would be good for closing the gap in transportation
maintenance.
Council President Ralph communicated that Thomas is against, Higgins is in favor,
Ranniger is neutral, and Berrios wants more information. She concluded that she will
communicate to the South County Area Transportation Board that the Kent City
Council is neutral on this item.
Councilmember Thomas communicated that a sixty dollar increase in tabs invites
Eyman to create something worse.
Councilmember Higgins agreed, but noted that Eyman wants these to come to a vote
of the people.
Council President Ralph communicated that it technically isn't sixty dollars, the
current twenty dollar vehicle registration tax would drop off and be sixty dollars, thus
forty dollars more. She also informed the Council to discuss this item with
Councilmember Boyce.
Brubaker noted that this is Nachlinger's last Council workshop and is leaving the City
in very good shape and thanked him for his service to the City of Kent.
Nachlinger stated that he is looking forward to his retirement.
The meeting adjourned at 6:15 p.m.
Ronald F. Moore, MMC
City Clerk
4
KENT
Kent City Council Meeting
January 21, 2014
The regular meeting of the Kent City Council was called to order at 7:01 p.m. by
Mayor Cooke.
Councilmembers present: Higgins, Berrios, Boyce, Ralph, Ranniger, and Thomas.
CHANGES TO THE AGENDA
A. From Council, Administration, Staff - Brubaker communicated that the item in
front of the Councilmembers' dias was the attachment to the Transportation
Improvement Board grant.
B. From the Public - None.
PUBLIC COMMUNICATIONS
A. Oath of office, Councilmember Jim Berrios - City Clerk Ronald F. Moore swore
in Jim Berrios as Councilmember Position No. 2.
B. Public Recognition
1. Kent Parks Foundation Donation - Jeff Watling, Parks and Recreation
Director introduced Mark Prothero, President of the Kent Parks Foundation who
presented the city of Kent with a check for $9,532.57. Prothero also discussed the
"Kent Dancing with the Stars" and communicated that the event raised $13,846.15.
Mayor Cooke thanked Prothero and verified that people who wanted to get in donating
or raising funds for Kent's recreation program could speak to Sandy Pedersen.
2. Award for Men's "E" Western National ASA Softball Tournament to the
City of Kent - Jeff Watling, Parks and Recration Director introduced Mike Raven from
the Amateur Sports Association (ASA). Raven thanked the Kent City staff and
presented the James Ferrell Award to Mayor Cooke and the city of Kent.
Mayor Cooke thanked Raven and the city of Kent Parks staff.
C. Community Events - Mayor Cooke announced that the "You-Me-We" event is this
Friday at the ShoWare Center, January 24 at 6:00 p.m. She encouraged the public to
attend the free event.
Mayor Cooke also noted that her "State of the City Address" wil be at the ShoWare
Center during the Chamber of Commerce Luncheon on February 5 at 12 noon. She
also added that it will be online and on the City's cable station.
D. Introduction of new Arts Commission Appointee, Jennifer Treese - Mayor
Cooke communicated that she interviewed her for the position.
Kent City Council Meeting Minutes January 21, 2014
Treese communicated that she found the vacancy online and said she has been doing
cultural things for over a decade now. She added that her employer is Blue Origin, a
rocket company in Kent.
E. Public Safety Report - Police Chief Ken Thomas discussed Mike Buckingham and
his memorial service last Thursday. He discussed Buckingham's service to the City and
people. He noted that he lost his battle with cancer on January 2, 2014.
Council President Ralph discussed Buckingham and her son's experience with him. She
stated that she was fortunate enough to meet him and work with him the last couple
of years. She said he has had a tremendous impact on the City and will truly be
missed.
Thomas discussed the year end report. He noted that commercial burglary is
unchanged and there has been a 21 percent reduction in residential burglaries from
2012 to present. He noted that robbery is down 13 percent. He noted that vehicle theft
is only up 2 percent compared to the rampant vehicle theft rate in King County.
Thomas presented Christin Jordan with the Police Chiefs Award of Accomodation. He
communicated that Jordan was instrumental in a stolen car recovery and preventing a
residential burglary.
Thomas presented Shanelle Mozique with the Police Chief's Award of Accomodation. He
explained that Mozique, while in the middle of a home invasion, called the police
department during the robbery. He noted that the police successfully caught two of the
three suspects.
Thomas presented Officer Whisteric and Officer Nixon with the Police Department
Lifesaving Medal for saving the life of Lewis Drake. Drake submitted a letter to the
Police Chief, which he read.
Thomas communicated that the City is in the top ten of all cities with a population of
250,000 or less for their efforts with National Night Out, which is run by Sarah Wood.
Sarah Wood communicated that the event will be on August 10, 2014 this year.
Thomas introduced four new officers, Siitupe Coffin, Kamal Sharif, Andrew Richardson,
and Brittany Rios. He discussed each of their backgrounds, work experience, and
education.
Mayor Cooke swore in the four officers.
Thomas introduced newly hired Corrections Officer Ian Lentz and Records Specialists
Julie Farris, Ashley Orlowski, Christy Roeber, and Crystal Sundquist. He highlighted
their work history and gave a brief backgound of their education and personal lives.
Thomas presented a Chief's Award of Accomodation to Councilmember Berrios for
performing CPR on a patient who suffered a medical emergency.
Mayor Cooke presented Chief Ken Thomas with his city of Kent 25 year service plaque.
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Kent City Council Meeting Minutes January 21, 2014
F. Intergovernmental Reports - Council President Ralph communicated that the
South County Area Transportation Board met concerning express toll lanes being
added on Interstate 405 between Lynnwood and Bellevue and the addition of express
toll lanes on Interstate 167. She said the Lynnwood connection is going on now is
expected to open in 2016 and the 167 should be done a couple of years after that. She
noted that the 405 project will feature a new definition of what a carpool is and they
are suggesting three person carpools.
Councilmember Higgins stated that he is serving on the Sound Cities Association Board
of Directors and their board retreat is January 31. He said he is also serving on the
King County Regional Transit Committee and has heard the proposal concerning
funding transit. He stated that the King County Executive can't wait on legislature so
they are going forward to create a Transportation Benefit District countywide which
would mean the twenty dollar car tab going up to sixty dollars and a 0.1% sales tax.
Sixty percent of the revenues would go to King County for Metro, saving 600,000
service hours, including five routes in Kent and the remaining 40 percent would go to
cities.
Councilmember Boyce noted that he represents the City on the board and received
consensus from the Council to present a neutral vote on this item for the Kent City
Council until the entire package is reviewed. He noted that the next meeting is
February 12.
Councilmember Thomas thanked Councilmember Berrios for his efforts in helping save
a man's life on January 1st. He noted that it was discussed at the Regional Fire
Authority meeting.
PUBLIC HEARINGS
None.
PUBLIC COMMENT
Mayor Cooke discussed the council seat vacancy and communicated that
Council President Ralph will discuss the item under Other Business.
1. Pauline Barrett, Kent - Barrett discussed the possible development of a marijuana
processing facility by her home. She communicated that the facility would be in the
center of a large residential area with high school children in the neighborhood. She
expressed concerns with security if this business is allowed to open.
2. Bill Doolittle, Kent - Doolittle communicated that when I-502 was adopted people
wanted it legalized and taxed. He stated that Kent is going out of their way to prevent
marijuana authorization and said he read that the City would be zoned to prevent it.
He urged the City to work with the liquor board to get this implemented. He said
marijuana is currently being sold, consumed, and created in the City of Kent.
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Kent City Council Meeting Minutes January 21, 2014
3. Thomas L. Brice, Kent - Brice discussed the Par 3 golf course and the vision of the
City. He said a committee has been formed by five residents and they have submitted
suggestions and ideas of what could be done concerning the course. He noted that
there is a debt and if you look at the books, the golf course isn't the problem. He
suggested the course be closed in the winter.
4. Martin Plys, Kent - Plys communicated that there is a $1.9 million surplus. He said
if there is a surplus it should be applied to the ShoWare Center and the golf course
should be sold.
Mayor Cooke verified that there isn't a surplus.
Plys opposed having any marijuana facilities in Kent.
CONSENT CALENDAR
Council President Ralph moved to approve Consent Calendar Items A through
P, seconded by Councilmember Thomas.
A. Minutes of the workshop and regular Council meeting of January P 2014 -
Approved
B. Appointment to Arts Commission —The Council confirmed the appointment of
Jennifer Treese to the Kent Arts Commission for a four year term ending October 31,
2017.
C. King County Solid Waste Division Waste Reduction & Recycling Grant -
Approved. - The Mayor was authorized to accept the Waste Reduction and Recycling
Grant Contract in the amount of $89,835 for 2014, and amend the budget and
authorize the expenditure of funds in accordance with the terms and conditions of the
grant, subject to final terms and conditions acceptable to the City Attorney and Public
Works Director.
D. Seattle-King County Health Department Local Hazardous Waste
Management Program/Recycling Event Grant- Approved. The Mayor was
authorized to accept the Local Hazardous Waste Management Program Contract in the
amount of $32,278.87 for 2014, and amend the budget and authorize the expenditure
of funds in accordance with the terms and conditions of the grant, subject to final
terms and conditions acceptable to the City Attorney and Public Works Director.
E. Contract with Olympic Environmental for 2014 -15 Residential Recycling
Collection Events- Approved. The Mayor was authorized to sign the Consultant
Services Agreement with Olympic Environmental Resources for Waste Reduction and
Recycling Activities and Programs for 2014 - 2015 in the amount of $185,551.00,
subject to final terms and conditions acceptable to the City Attorney and the Public
Works Director.
F. SR 516 to S 2315t Way Levee North Reach Improvements, Change order
No. 1- Approved. The Mayor was authorized to approve Change Order No. 1 to SCI
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Kent City Council Meeting Minutes January 21, 2014
Infrastructure, LLC in an amount not to exceed $194,059.46 for unanticipated
construction costs on the SR 516 to South 231st Way Levee, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
G. Central Avenue South Improvements Federal Grant- Accept. The Mayor was
authorized to accept a Federal Grant in the amount of $300,000 for the design phase
of the Central Avenue South Pavement Preservation Project, and amend the budget
and authorize expenditure of the funds in accordance with the terms and conditions of
the grant, subject to final terms and conditions acceptable to the City Attorney and
Public Works Director.
H. Kent Interurban Trail Connector Proiect Grant — Accept. The Mayor was
authorized to sign the grant agreement in the amount of $727,500 with the
Washington State Department of Commerce for the Kent Interurban Trail Connector
Project and amend the budget and authorize expenditure of the funds in accordance
with the terms and conditions of the grant, subject to final terms and conditions
acceptable to the City Attorney and Public Works Director.
I. South 224th Street Improvements, Phase 2 Transportation Improvement
Board (TIB) Grant- Accept. The Mayor was authorized to accept a grant from the
Washington State Transportation Improvement Board for Phase 2 of the South 224th
Street Improvement Project and sign a letter to the TIB requesting to combine Phases
1 and 2 into one project, amend the budget and authorize expenditure of the funds in
accordance with the terms and conditions of the grant, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
J. Washington Auto Theft Prevention Authority (WATPA) Patrol Task Force
2013 — 2015 Grant- Accept. The Mayor was authorized to accept the Washington
Auto Theft Prevention Authority grant award in the amount of $74,983, authorize
amending the budget and authorize expenditure of the funds in accordance with the
terms and conditions of the grant, acceptable to the City Attorney and Police Chief.
K. Ordinance Amending Kent City Code Chapter 9.02, Lewd Conduct — Adopt.
The Council adopted Ordinance No. amending Chapter 9.02 by establishing crimes
relating to lewd conduct, by amending sections relating to prostitution loitering and by
adding new areas which fall within the scope of the stay out of areas of prostitution
orders.
L. 2012 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2012 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc., upon receipt of standard releases from
the state and the release of any liens.
M. 2013 Thermo Plastic Markings Proiect Completion - Accept. They Mayor
was authorized to accept the 2013 Thermo Plastic Markings Project as complete and
release retainage to Stripe Rite Inc., upon receipt of standard releases from the state
and the release of any liens.
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Kent City Council Meeting Minutes January 21, 2014
N. 2013 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2013 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc. upon receipt of standard releases from the
state and the release of any liens.
0. Hawley Road Levee Improvements Phase I Proiect Completion — Accept.
The Mayor was authorized to accept the Hawley Road Levee Improvements Phase I
Project as complete and release retainage to SCI Infrastructure LLC, upon receipt of
standard releases from the state and the release of any liens.
P. Horseshoe Bend and Upper Russell Road Levee Planting Proiect
Completion — Accept. The Mayor was authorized to accept the Horseshoe Bend and
Upper Russell Road Levee Plantings Project as complete and release retainage to
Restoration Logistics, upon receipt of standard releases from the state and the release
of any liens.
OTHER BUSINESS
A. Council Position No. 6 - Appointment Process - Mayor Cooke introduced the
item. Council President Ralph communicated the process and noted that the process
will be posted on the City's website and a handout was given to those in attendance by
City Clerk Moore.
Councilmember Boyce inquired what would happen with current applications and
Councilpresident Ralph communicated that she would communicate with anyone who
has previously submitted an application and inform them of the current process.
Councilmember Thomas inquired about the position and the process. Acting City
Attorney Fitzpatrick noted that the appointment lasts until the November 2015 election
is certified and whoever is elected at the general election will serve the rest of the
term.
1. Anna Davis, Kent - Davis discussed the process and inquired if the candidate that
also ran for the position in November could be considered and not have to reapply.
Mayor Cooke replied that the candidate needs to submit an application and go through
this process. She further explained the election process and said it is set up by state
law and it is up to the Council to interview and selects a candidate. She further
explained that it wasn't an option to have the runner-up in the November election
considered.
Council President Ralph also replied that this is the appointment process and that once
the November election is certified it is over. She also communicated that this
information will be on the website, channel 21, in the Kent Reporter, and announced at
Neighborhood Council meetings, etc.
BIDS
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Kent City Council Meeting Minutes January 21, 2014
A. Briscoe-Desimone Levee Improvements, Reaches 2 and 3 - Tim LaPorte,
Public Works Director introduced the levee improvements. He displayed the levee, why
the improvements are needed, and what the improvements would entail. He
communicated that there were ten excellent bids and has checked out the
qualifications of the lowest bidder, Tapani, Inc. LaPorte explained to Mayor Cooke why
this item wasn't heard at a committee, noting that a bid award doesn't go to
committee, but straight to the Council.
Councilmember Higgins moved to authorize the Mayor to award the bid for
the Briscoe-Desimone Levee Improvements Reaches 2 and 3 project to
Tapani, Inc., in the amount of $6,709,555.56 and authorize the Mayor to sign
all necessary documents, subject to the final terms and conditions acceptable
to the City Attorney and Public Works Director, seconded by Council President
Ralph. Motion carried 6-0.
LaPorte communicated that King County Flood District wants a groundbreaking
ceremony for this levee improvement this spring.
Mayor Cooke agreed and communicated that the City should also look at what park
element should be added to the south.
REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
A. Council President. Ralph stated that the B&O tax was discussed in the workshop
meeting and that the Council decided to hold off on any amendments to it at this time.
She stated that there will be a 501(c) item exemption going forth as a draft to the
Operations Committee and an item concerning 3PLs going to the Economic and
Community Development Committee at a later date.
B. Mayor. No report.
C. Administration. No report. No executive session tonight.
D. Economic & Community Development Committee. Councilmember Boyce
communicated that the next meeting is February 10.
E. Operations Committee. No report.
F. Parks and Human Services Committee. No report.
G. Public Safety Committee. No report.
H. Public Works Committee. Councilmember Higgins communicated that the
meeting yesterday was postponed and the next meetig is January 27.
I. Regional Fire Authority. Councilmember Thomas communicated that he stepped
down as chair and Mike Denfro is the chair and Higgins is the deputy chair.
EXECUTIVE SESSION ACTION AFTER EXECUTIVE SESSION
7
Kent City Council Meeting Minutes January 21, 2014
No executive session was held.
ADJOURNMENT
The meeting adjourned at 8:38 p.m.
Ronald F. Moore, MMC
City Clerk
8
40.
KF14 Agenda Item: Consent — 7C
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointment to Kent Arts Commission — Confirm
MOTION: Confirm the Mayor's appointment of Lynn Bohart to the Kent
Arts Commission.
SUMMARY: Confirm the appointment of Lynn Bohart to the Kent Arts Commission for
a four year term ending October 31, 2017.
Lynn Bohart submitted an application for appointment to the Kent Arts Commission
to fill a vacant four year term. Lynn is Executive Director of the Renton Community
Foundation and remains an avid supporter of the arts. Lynn's belief is that a vibrant
arts community speaks to the soul of a city.
Lynn holds a Master's Degree in theater and has worked in Community Theater over
the years. She is a published mystery writer on Amazon.com, teaches writing through
the Kent Parks Department and Green River Community College's Continuing
Education program. She has served on the Lane County Arts Council Board while
living in Oregon and has served on the Vancouver Arts Commission before moving to
Kent.
Lynn's commitment to the Kent community and her active role in the arts makes her
an exceptional candidate for the Kent Arts Commission, and I am pleased to
recommend Lynn Bohart for your confirmation.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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KENT
° Agenda Item: Consent — 7D
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointments to Land Use and Planning Board — Confirm
MOTION: Confirm the Mayor's appointment of Katherine Jones and re-
appointment of Barbara Phillips to the Land Use & Planning Board.
SUMMARY: Confirm the appointment of Katherine Jones and re-appointment of
Barbara Phillips to the Land Use & Planning Board each for a three year term ending
December 31, 2016.
Katherine Jones made application for appointment to the Land Use & Planning Board
for a three-year term. Kathi, a Realtor with John L. Scott, lives in The Lakes
community, and feels her service on the LUPB will assist in promoting a healthier and
improved environment for all Kent citizens. Kathi's work as a realtor gives her an
understanding of the Smart Growth principles involving citizens, public officials and
stakeholders working together to plan ahead for development. Kathy has attended
many LUPB meetings and city council meetings in an effort to stay abreast of issues
confronting our community. She was an interested participant in the Midway Project,
the Cottage Housing Project, and is head of The Lakes Neighborhood Council
Kathi's commitment to the Kent community makes her an ideal candidate for the Land
Use & Planning Board, and I am pleased to recommend Kathi Jones for your
confirmation.
Barbara Phillips was first appointed to the Land Use & Planning Board in November,
2007, expressing her desire to be an integral part of the City's development and
future prosperity. Her reappointment will begin her third term which will expire on
December 31, 2016. Barbara has lived in Kent for over 20 years and currently is
President of the Community Network Council which works to connect youth with
resources that will help them become successful.
I am pleased to recommend re-appointment of Barbara Phillips to the LUPB.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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•
Nl- KENT Agenda Item: Consent- 7E
TO: City Council
DATE: February 4, 2014
SUBJECT: Refunding 2004 Limited Tax General Obligation Bond Ordinance - Adopt
MOTION: Move to adopt Ordinance No. , approving the refunding of
the 2004 Limited Tax General Obligation bonds.
SUMMARY: The 2004 LTGO bonds are callable at par on June 1, 2014 and may be
called 90 days in advance of the call date. This transaction would save an estimated
$700,000 over the eight year life of the bonds by issuing refunding bonds at a lower
interest rate. The existing bonds would be retired as of June 1 and defeased.
EXHIBITS: Ordinance
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: This transaction would reduce the debt service cost paid by the
Capital Improvements Fund by approximately $87,500 annually over the next eight
years.
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ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE OF LIMITED
TAX GENERAL OBLIGATION REFUNDING BONDS OF THE CITY
IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED
$14,000,000 TO REFUND CERTAIN OUTSTANDING LIMITED
TAX GENERAL OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM AND TERMS OF
THE BONDS; AND DELEGATING THE AUTHORITY TO
APPROVE THE FINAL TERMS OF THE BONDS.
PASSED: FEBRUARY 4, 2014
PREPARED BY:
PACIFICA LAW GROUP LLP
Seattle, Washington
CITY OF KENT
ORDINANCE NO.
TABLE OF CONTENTS*
Page
SECTION 1. - Definitions and Interpretation of Terms 2
SECTION 2. - Authorization of Bonds and Bond Details 8
SECTION 3. - Registration, Exchange and Payments 9
SECTION 4. - Redemption Prior to Maturity and Purchase
of Bonds 15
SECTION 5. - Form of Bonds 20
SECTION 6. - Execution of Bonds 22
SECTION 7. - Refunding Plan; Application of Bond
Proceeds 23
SECTION 8. - Tax Covenants 26
SECTION 9. - Bond Fund and Provision for Tax Levy
Payments 29
SECTION 10. - Defeasance 30
SECTION 11. - Sale of Bonds 31
SECTION 12. - Undertaking to Provide Ongoing Disclosure 33
SECTION 13. - Lost, Stolen or Destroyed Bonds 38
SECTION 14. - Severability; Ratification 38
SECTION 15. - Effective Date of Ordinance 40
* This Table of Contents is provided for convenience only and is not a part
of this ordinance.
-1- 01/14/14
CITY OF KENT, WASHINGTON
ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE
OF LIMITED TAX GENERAL OBLIGATION
REFUNDING BONDS OF THE CITY IN THE
AGGREGATE PRINCIPAL AMOUNT OF NOT TO
EXCEED $14,000,000 TO REFUND CERTAIN
OUTSTANDING LIMITED TAX GENERAL
OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM
AND TERMS OF THE BONDS; AND DELEGATING
THE AUTHORITY TO APPROVE THE FINAL
TERMS OF THE BONDS.
A. The City of Kent, Washington (the "City") has outstanding its
Limited Tax General Obligation Refunding Bonds, 2004, issued pursuant to
Ordinance No. 3682 adopted by the City Council (the "Council") of the City
on March 16, 2004 (the "2004 Bond Ordinance"), which remain
outstanding as follows:
Maturity Date
(December 1) Principal Amount Interest Rate
2014 $ 1,875,000 5.000%
2015 1,750,000 5.250
2016 1,625,000 5.250
2017 1,445,000 5.250
2018 1,265,000 5.250
2019 1,280,000 4.000
2020 2,030,000 4.000
2021 1,325,000 4.125
(the "2004 Bonds"); and
B. The 2004 Bond Ordinance provides that the City may call the
2004 Bonds maturing on or after December 1, 2014 (the "Refunding
Candidates") for redemption on or after June 1, 2014, in whole or in part
at any time, at a price of par plus accrued interest, if any, to the date of
redemption; and
C. After due consideration it appears to the Council that all or a
portion of the Refunding Candidates may be defeased and refunded by the
proceeds of limited tax general obligation refunding bonds at a savings to
the City and its taxpayers; and
D. The Council deems it in the best interest of the City to issue
limited tax general obligation refunding bonds in the aggregate principal
amount of not to exceed $14,000,000 (the "Bonds") to redeem and
defease all or a portion of the Refunding Candidates and to pay costs of
issuing the Bonds; and
E. The Council wishes to delegate authority to the Mayor (the
"Designated Representative"), for a limited time, to approve the interest
rates, maturity dates, redemption terms and principal maturities for the
Bonds within the parameters set by this ordinance; and
F. The City expects to receive a proposal from KeyBanc Capital
Markets Inc. (the "Underwriter") and now desires to issue and sell the
Bonds to the Underwriter as set forth herein;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON DO ORDAIN as follows:
SECTION 1. - Definitions and Interpretation of Terms.
(a) Definitions. As used in this ordinance, the following words
shall have the following meanings:
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Acquired Obligations means the Government Obligations acquired
by the City under the terms of this ordinance and the Escrow Deposit
Agreement to effect the defeasance and refunding of the Refunded Bonds.
Beneficial Owner means any person that has or shares the power,
directly or indirectly, to make investment decisions concerning ownership
of any Bonds (including persons holding Bonds through nominees,
depositories or other intermediaries).
Bond Fund means the "City of Kent Limited Tax General Obligation
Bond Debt Service Fund, 2014" authorized to be created pursuant to
Section 9.
Bond Purchase Contract means the contract for the purchase of the
Bonds between the Underwriter and the City, executed pursuant to
Section 11.
Bond Register means the registration books showing the name,
address and tax identification number of each Registered Owner of the
Bonds, maintained pursuant to Section 149(a) of the Code.
Bond Registrar means, initially, the fiscal agency of the State of
Washington, for the purposes of registering and authenticating the Bonds,
maintaining the Bond Register, effecting transfer of ownership of the
Bonds and paying interest on and principal of the Bonds.
Bond Year means each one-year period that ends on the date
selected by the City. The first and last Bond Years may be short periods.
If no date is selected by the City before the earlier of the final maturity
date of Bonds or the date that is five years after the date of issuance of
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any Bonds, Bond Years end on each anniversary of the date of issue and
on the final maturity date of such Bonds.
Bonds mean the not to exceed $14,000,000 aggregate principal
amount of City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014, authorized to be issued pursuant to this
ordinance.
Call Date means June 1, 2014.
Chief Administrative Officer means the Chief Administrative Officer
or Interim Chief Administrative Officer of the City or the successor to such
officer.
City means the City of Kent, Washington, a municipal corporation
duly organized and existing under and by virtue of the Constitution and
laws of the State of Washington.
Code means the Internal Revenue Code of 1986, as amended, and
shall include all applicable regulations and rulings relating thereto.
Commission means the Securities and Exchange Commission.
Council or City Council means the legislative body of the City as
duly and regularly constituted from time to time.
Designated Representative means the Mayor, or his or her
designee.
DTC means The Depository Trust Company, New York, New York, a
limited purpose trust company organized under the laws of the State of
New York, as depository for the Bonds pursuant to Section 3.
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Escrow Agent means U.S. Bank National Association, Seattle,
Washington.
Escrow Deposit Agreement means the Escrow Deposit Agreement
between the City and the Escrow Agent to be dated as of the date of
closing of the Bonds and substantially in the form on file with the City.
Federal Tax Certificate means the certificate executed by the
Finance Director setting forth the requirements of the Code for
maintaining the tax exemption of interest on the Bonds, and attachments
thereto.
Finance Director means the Finance Director of the City or the
successor to such officer.
Financial Advisor means Piper ]affray & Co., or its successors.
Government Obligations mean those obligations now or hereafter
defined as such in chapter 39.53 RCW.
Letter of Representations means the blanket issuer letter of
representations from the City to DTC.
MSRB means the Municipal Securities Rulemaking Board or any
successors to its functions.
Net Proceeds, when used with reference to the Bonds, means the
principal amount of such Bonds, plus accrued interest and original issue
premium, if any, and less original issue discount, if any.
Private Person means any natural person engaged in a trade or
business or any trust, estate, partnership, association, company or
corporation.
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Private Person Use means the use of property in a trade or business
by a Private Person if such use is other than as a member of the general
public. Private Person Use includes ownership of the property by the
Private Person as well as other arrangements that transfer to the Private
Person the actual or beneficial use of the property (such as a lease,
management or incentive payment contract or other special arrangement)
in such a manner as to set the Private Person apart from the general
public. Use of property as a member of the general public includes
attendance by the Private Person at municipal meetings or business rental
of property to the Private Person on a short-term basis in accordance with
regulations under the Code if the rental paid by such Private Person is the
same as the rental paid by any Private Person who desires to rent the
property. Use of property by nonprofit community groups or community
recreational groups is not treated as Private Person Use if such use is
incidental to the governmental uses of property, the property is made
available for such use by all such community groups on an equal basis and
such community groups are charged only a de minimis fee to cover
custodial expenses.
Refunded Bonds mean all or a portion of the Refunding Candidates
designated by the Designated Representative for refunding pursuant to
Section 7 and Section 11.
Refunding Account means the account by that name established
pursuant to Section 7.
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Refunding Candidates mean the 2004 Bonds maturing on or after
December 1, 2014.
Registered Owner means the person named as the registered owner
of a Bond in the Bond Register. For so long as the Bonds are held in book-
entry only form, DTC or its nominee shall be deemed to be the sole
Registered Owner.
Rule means the Commission's Rule 15c2-12 under the Securities
Exchange Act of 1934, as the same may be amended from time to time.
2004 Bond Ordinance means Ordinance No. 3682 adopted by the
Council on March 16, 2004 authorizing the issuance of the 2004 Bonds.
2004 Bonds mean the City of Kent, Washington, Limited Tax
General Obligation Refunding Bonds, 2004 issued pursuant to the 2004
Bond Ordinance as described in the recitals of this ordinance.
Underwriter means KeyBanc Capital Markets Inc., or its successors.
(b) Interpretation. In this ordinance, unless the context
otherwise requires:
(1) The terms "hereby," "hereof," "hereto," "herein,"
"hereunder" and any similar terms, as used in this ordinance, refer to this
ordinance as a whole and not to any particular article, section, subdivision
or clause hereof, and the term "hereafter" shall mean after, and the term
"heretofore" shall mean before, the date of this ordinance;
(2) Words of the masculine gender shall mean and include
correlative words of the feminine and neuter genders and words importing
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the singular number shall mean and include the plural number and vice
versa;
(3) Words importing persons shall include firms,
associations, partnerships (including limited partnerships), trusts,
corporations and other legal entities, including public bodies, as well as
natural persons;
(4) Any headings preceding the text of the several articles
and sections of this ordinance, and any table of contents or marginal notes
appended to copies hereof, shall be solely for convenience of reference
and shall not constitute a part of this ordinance, nor shall they affect its
meaning, construction or effect; and
(5) All references herein to "articles," "sections" and other
subdivisions or clauses are to the corresponding articles, sections,
subdivisions or clauses hereof.
SECTION 2,- Authorization of Bonds and Bond Details. For the
purpose of refunding the Refunded Bonds and paying costs of issuance of
the Bonds, the City shall issue and sell limited tax general obligation
refunding bonds in the aggregate principal amount of not to exceed
$14,000,000 (the "Bonds").
The Bonds shall be general obligations of the City, shall be
designated "City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014" with other such designation as set forth in the
Bond Purchase Contract and approved by the Designated Representative.
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The Bonds shall be dated as of their date of initial delivery, shall be
fully registered as to both principal and interest, shall be in the
denomination of $5,000 each or any integral multiple thereof within a
maturity, shall be numbered separately in the manner and with any
additional designation as the Bond Registrar deems necessary for
purposes of identification and control, and shall bear interest payable on
the dates set forth in the Bond Purchase Contract. The Bonds shall bear
interest at the rates set forth in the Bond Purchase Contract; and shall
mature on the dates and in the principal amounts set forth in the Bond
Purchase Contract and as approved by a Designated Representative
pursuant to Section 11.
SECTION 3. - Registration, Exchange and Payments.
(a) Bond Registrar/Bond Register. The City hereby specifies and
adopts the system of registration approved by the Washington State
Finance Committee from time to time through the appointment the state
fiscal agency. The City shall cause a Bond Register to be maintained by
the Bond Registrar. So long as any Bonds remain outstanding, the Bond
Registrar shall make all necessary provisions to permit the exchange or
registration or transfer of Bonds at its principal corporate trust office. The
Bond Registrar may be removed at any time at the option of the Finance
Director upon prior notice to the Bond Registrar and a successor Bond
Registrar appointed by the Finance Director. No resignation or removal of
the Bond Registrar shall be effective until a successor shall have been
appointed and until the successor Bond Registrar shall have accepted the
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duties of the Bond Registrar hereunder. The Bond Registrar is authorized,
on behalf of the City, to authenticate and deliver Bonds transferred or
exchanged in accordance with the provisions of such Bonds and this
ordinance and to carry out all of the Bond Registrar's powers and duties
under this ordinance. The Bond Registrar shall be responsible for its
representations contained in the Certificate of Authentication of the Bonds.
(b) Registered Ownership. The City and the Bond Registrar, each
in its discretion, may deem and treat the Registered Owner of each Bond
as the absolute owner thereof for all purposes (except as provided in
Section 12 of this ordinance), and neither the City nor the Bond Registrar
shall be affected by any notice to the contrary. Payment of any such Bond
shall be made only as described in Section 3(h), but such Bond may be
transferred as herein provided. All such payments made as described in
Section 3(h) shall be valid and shall satisfy and discharge the liability of
the City upon such Bond to the extent of the amount or amounts so paid.
(c) DTC Acceptance/Letters of Representations. The Bonds
initially shall be held in fully immobilized form by DTC acting as
depository. To induce DTC to accept the Bonds as eligible for deposit at
DTC, the City has executed and delivered to DTC a Blanket Issuer Letter of
Representations. Neither the City nor the Bond Registrar will have any
responsibility or obligation to DTC participants or the persons for whom
they act as nominees (or any successor depository) with respect to the
Bonds in respect of the accuracy of any records maintained by DTC (or
any successor depository) or any DTC participant, the payment by DTC (or
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any successor depository) or any DTC participant of any amount in respect
of the principal of or interest on Bonds, any notice which is permitted or
required to be given to Registered Owners under this ordinance (except
such notices as shall be required to be given by the City to the Bond
Registrar or to DTC (or any successor depository)), or any consent given
or other action taken by DTC (or any successor depository) as the
Registered Owner. For so long as any Bonds are held in fully immobilized
form by a depository, DTC or its successor depository shall be deemed to
be the Registered Owner for all purposes hereunder, and all references
herein to the Registered Owners shall mean DTC (or any successor
depository) or its nominee and shall not mean the owners of any beneficial
interest in such Bonds.
(d) Use of Depository.
(1) The Bonds shall be registered initially in the name of
"Cede & Co.", as nominee of DTC, with one Bond maturing on each of the
maturity dates for the Bonds in a denomination corresponding to the total
principal therein designated to mature on such date. Registered
ownership of such Bonds, or any portions thereof, may not thereafter be
transferred except (A) to any successor of DTC or its nominee, provided
that any such successor shall be qualified under any applicable laws to
provide the service proposed to be provided by it; (B) to any substitute
depository appointed by the Finance Director pursuant to subsection (2)
below or such substitute depository's successor; or (C) to any person as
provided in subsection (4) below.
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(2) Upon the resignation of DTC or its successor (or any
substitute depository or its successor) from its functions as depository or a
determination by the Finance Director to discontinue the system of book
entry transfers through DTC or its successor (or any substitute depository
or its successor), the Finance Director may hereafter appoint a substitute
depository. Any such substitute depository shall be qualified under any
applicable laws to provide the services proposed to be provided by it.
(3) In the case of any transfer pursuant to clause (A) or
(B) of subsection (1) above, the Bond Registrar shall, upon receipt of all
outstanding Bonds, together with a written request on behalf of the
Finance Director, issue a single new Bond for each maturity then
outstanding, registered in the name of such successor or such substitute
depository, or their nominees, as the case may be, all as specified in such
written request of the Finance Director.
(4) In the event that (A) DTC or its successor (or
substitute depository or its successor) resigns from its functions as
depository, and no substitute depository can be obtained, or (B) the
Finance Director determines that it is in the best interest of the beneficial
owners of the Bonds that such owners be able to obtain physical Bond
certificates, the ownership of such Bonds may then be transferred to any
person or entity as herein provided, and such Bonds shall no longer be
held by a depository. The Finance Director shall deliver a written request
to the Bond Registrar, together with a supply of physical Bonds, to issue
Bonds as herein provided in any authorized denomination. Upon receipt
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by the Bond Registrar of all then outstanding Bonds together with a
written request on behalf of the Finance Director to the Bond Registrar,
new Bonds shall be issued in the appropriate denominations and
registered in the names of such persons as are requested in such written
request.
(e) Registration of Transfer of Ownership or Exchange; Change in
Denominations. The transfer of any Bond may be registered and Bonds
may be exchanged, but no transfer of any such Bond shall be valid unless
it is surrendered to the Bond Registrar with the assignment form
appearing on such Bond duly executed by the Registered Owner or such
Registered Owner's duly authorized agent in a manner satisfactory to the
Bond Registrar. Upon such surrender, the Bond Registrar shall cancel the
surrendered Bond and shall authenticate and deliver, without charge to
the Registered Owner or transferee therefor, a new Bond (or Bonds at the
option of the new Registered Owner) of the same date, maturity and
interest rate and for the same aggregate principal amount in any
authorized denomination, naming as Registered Owner the person or
persons listed as the assignee on the assignment form appearing on the
surrendered Bond, in exchange for such surrendered and cancelled Bond.
Any Bond may be surrendered to the Bond Registrar and exchanged,
without charge, for an equal aggregate principal amount of Bonds of the
same date, maturity and interest rate, in any authorized denomination.
The Bond Registrar shall not be obligated to register the transfer or to
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exchange any Bond during the 15 days preceding any principal payment
date any such Bond is to be redeemed.
(f) Bond Registrar's Ownership of Bonds. The Bond Registrar
may become the Registered Owner of any Bond with the same rights it
would have if it were not the Bond Registrar, and to the extent permitted
by law, may act as depository for and permit any of its officers or directors
to act as a member of, or in any other capacity with respect to, any
committee formed to protect the right of the Registered Owners of Bonds.
(g) Registration Covenant. The City covenants that, until all
Bonds have been surrendered and canceled, it will maintain a system for
recording the ownership of each Bond that complies with the provisions of
Section 149 of the Code.
(h) Place and Medium of Payment. 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 calculated on the basis of a year
of 360 days and twelve 30-day months. For so long as all Bonds are held
by a depository, payments of principal and interest thereon shall be made
as provided in accordance with the operational arrangements of DTC
referred to in the Letter of Representations. In the event that the Bonds
are no longer held by a depository, interest on the Bonds shall be paid by
check or draft mailed to the Registered Owners at the addresses for such
Registered Owners appearing on the Bond Register on the fifteenth day of
the month preceding the interest payment date, or upon the written
request of a Registered Owner of more than $1,000,000 of Bonds
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(received by the Bond Registrar at least 15 days prior to the applicable
payment date), such payment shall be made by the Bond Registrar by
wire transfer to the account within the United States designated by the
Registered Owner. Principal of the Bonds shall be payable upon
presentation and surrender of such Bonds by the Registered Owners at the
principal office of the Bond Registrar.
If any Bond shall be duly presented for payment and funds have not
been duly provided by the City on such applicable date, then interest shall
continue to accrue thereafter on the unpaid principal thereof at the rate
stated on such Bond until it is paid.
SECTION 4, - Redemption Prior to Maturity and Purchase of Bonds.
(a) Mandatory Redemption of Term Bonds and Optional
Redemption, if any. The Bonds shall be subject to optional redemption on
the dates, at the prices and under the terms set forth in the Bond
Purchase Contract approved by the Designated Representative pursuant to
Section 11. The Bonds shall be subject to mandatory redemption to the
extent, if any, set forth in the Bond Purchase Contract approved by the
Designated Representative pursuant to Section 11.
(b) Purchase of Bonds. The City reserves the right to purchase
any of the Bonds offered to it at any time at a price deemed reasonable by
the Finance Director.
(c) Selection of Bonds for Redemption. For as long as the Bonds
are held in book-entry only form, the selection of particular Bonds within a
maturity to be redeemed shall be made in accordance with the operational
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arrangements then in effect at DTC. If the Bonds are no longer held in
uncertificated form, the selection of such Bonds to be redeemed and the
surrender and reissuance thereof, as applicable, shall be made as provided
in the following provisions of this subsection (c). If the City redeems at
any one time fewer than all of the Bonds having the same maturity date,
the particular Bonds or portions of Bonds of such maturity to be redeemed
shall be selected by lot (or in such manner determined by the Bond
Registrar) in increments of $5,000. In the case of a Bond of a
denomination greater than $5,000, the City and the Bond Registrar shall
treat each Bond as representing such number of separate Bonds each of
the denomination of $5,000 as is obtained by dividing the actual principal
amount of Bonds by $5,000. In the event that only a portion of the
principal sum of a Bond is redeemed, upon surrender of such Bond at the
principal office of the Bond Registrar there shall be issued to the
Registered Owner, without charge therefor, for the then unredeemed
balance of the principal sum thereof, at the option of the Registered
Owner, a Bond or Bonds of like maturity and interest rate in any of the
denominations herein authorized.
(d) Notice of Redemption.
(1) Official Notice. For so long as the Bonds are held in
uncertificated form, notice of redemption (which notice may be
conditional) shall be given in accordance with the operational
arrangements of DTC as then in effect, and neither the City nor the Bond
Registrar will provide any notice of redemption to any Beneficial Owners.
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Thereafter (if the Bonds are no longer held in uncertificated form), notice
of redemption shall be given in the manner hereinafter provided. Unless
waived by any owner of Bonds to be redeemed, official notice of any such
redemption (which redemption may be conditioned by the Bond Registrar
on the receipt of sufficient funds for redemption or otherwise) shall be
given by the Bond Registrar on behalf of the City by mailing a copy of an
official redemption notice by first class mail at least 20 days and not more
than 60 days prior to the date fixed for redemption to the Registered
Owner of the Bond or Bonds to be redeemed at the address shown on the
Bond Register or at such other address as is furnished in writing by such
Registered Owner to the Bond Registrar.
All official notices of redemption shall be dated and shall state:
(A) the redemption date,
(B) the redemption price,
(C) if fewer than all outstanding Bonds are to be
redeemed, the identification by maturity (and, in the case of partial
redemption, the respective principal amounts) of the Bonds to be
redeemed,
(D) that (unless such notice is conditional) on the
redemption date the redemption price will become due and payable upon
each such Bond or portion thereof called for redemption, and that interest
thereon shall cease to accrue from and after said date, and
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(E) the place where such Bonds are to be
surrendered for payment of the redemption price, which place of payment
shall be the principal office of the Bond Registrar.
On or prior to any redemption date (unless such notice is
conditional), the City shall deposit with the Bond Registrar an amount of
money sufficient to pay the redemption price of all the Bonds or portions
of Bonds which are to be redeemed on that date.
(2) Effect of Notice; Bonds Due. If an unconditional notice
of redemption has been given as aforesaid, or if the conditions to
redemption have been satisfied or waived, the Bonds or portions of Bonds
so to be redeemed shall, on the redemption date, become due and
payable at the redemption price therein specified, and from and after such
date such Bonds or portions of Bonds shall cease to bear interest. Upon
surrender of such Bonds for redemption in accordance with said notice,
such Bonds shall be paid by the Bond Registrar at the redemption price.
Installments of interest due on or prior to the redemption date shall be
payable as herein provided for payment of interest. All Bonds which have
been redeemed shall be canceled by the Bond Registrar and shall not be
reissued.
If a conditional notice of redemption has been given and the
conditions to redemption have not been satisfied or waived, notice of
redemption given pursuant to this ordinance may be rescinded by written
notice given by the Bond Registrar on behalf of the City as soon as
practicable in the same manner, and to the same Registered Owners of
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the Bond or Bonds, as notice of such redemption was given pursuant to
this Section 4(d). If notice of recession has been provided, the Bonds or
portions of Bonds so to be redeemed, on the redemption date, shall not
become due and payable and from and after such date such Bonds or
portions of Bonds shall continue to bear interest at the rate or rates set
forth therein until paid or until due provision is made for the payment of
the same.
(3) Additional Notice. In addition to the foregoing notice,
further notice shall be given by the City as set out below, but no defect in
said further notice nor any failure to give all or any portion of such further
notice shall in any manner defeat the effectiveness of a call for redemption
if notice thereof is given as above prescribed. Each further notice of
redemption given hereunder shall contain the information required above
for an official notice of redemption plus (A) the CUSIP numbers of all
Bonds being redeemed; (B) the date of issue of the Bonds as originally
issued; (C) the rate of interest borne by each Bond being redeemed;
(D) the maturity date of each Bond being redeemed; and (E) any other
descriptive information needed to identify accurately the Bonds being
redeemed. Each further notice of redemption may be sent at least
20 days before the redemption date to each party entitled to receive
notice pursuant to Section 12 and with such additional information as the
City shall deem appropriate, but such mailings shall not be a condition
precedent to the redemption of such Bonds.
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(4) Amendment of Notice Provisions. The foregoing notice
provisions of this Section 4, including but not limited to the information to
be included in redemption notices and the persons designated to receive
notices, may be amended by additions, deletions and changes in order to
maintain compliance with duly promulgated regulations and
recommendations regarding notices of redemption of municipal securities.
SECTIONS. - Form of Bonds. The Bonds shall be in substantially
the following form with appropriate or necessary insertions, depending
upon the omissions and variations as permitted or required hereby:
UNITED STATES OF AMERICA
NO. $
STATE OF WASHINGTON
CITY OF KENT
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2014
INTEREST RATE: % MATURITY DATE: CUSIP NO.:
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The City of Kent, Washington (the "City"), hereby acknowledges
itself to owe and for value received promises to pay to the Registered
Owner identified above, or registered assigns, on the Maturity Date
identified above, the Principal Amount indicated above and to pay interest
thereon from , 2014, or the most recent date to which
interest has been paid or duly provided for until payment of this bond at
the Interest Rate set forth above, payable on and
semiannually thereafter on the first days of each succeeding and
Both principal of and interest on this bond are payable in lawful
money of the United States of America. The fiscal agency of the State of
Washington has been appointed by the City as the authenticating agent,
paying agent and registrar for the bonds of this issue (the "Bond
Registrar"). For so long as the bonds of this issue are held in fully
immobilized form, payments of principal and interest thereon shall be
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made as provided in accordance with the operational arrangements of The
Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter
of Representations (the "Letter of Representations") from the City to DTC.
The bonds of this issue are issued under and in accordance with the
provisions of the Constitution and applicable statutes of the State of
Washington and Ordinance No. duly passed by the City Council
on February 4, 2014 (the "Bond Ordinance"). Capitalized terms used in
this bond have the meanings given such terms in the Bond Ordinance.
This bond shall not be valid or become obligatory for any purpose or
be entitled to any security or benefit under the Bond Ordinance until the
Certificate of Authentication hereon shall have been manually signed by or
on behalf of the Bond Registrar or its duly designated agent.
This bond is one of an authorized issue of bonds of like series, date,
tenor, rate of interest and date of maturity, except as to number and
amount in the aggregate principal amount of $ and is issued
pursuant to the Bond Ordinance to provide a portion of the funds
necessary (a) to defease and refund certain limited tax general obligation
bonds of the City, and (b) to pay costs of issuance.
[The bonds of this issue are subject to redemption as provided in
the Bond Ordinance and the Bond Purchase Contract.]
The City hereby irrevocably covenants and agrees with the owner of
this bond that it will include in its annual budget and levy taxes annually,
within and as a part of the tax levy permitted to the City without a vote of
the electorate, upon all the property subject to taxation in amounts
sufficient, together with other money legally available therefor, to pay the
principal of and interest on this bond as the same shall become due. The
full faith, credit and resources of the City are hereby irrevocably pledged
for the annual levy and collection of such taxes and the prompt payment
of such principal and interest.
[The bonds of this issue have [not] been designated by the City as
"qualified tax-exempt obligations" for investment by financial institutions
under Section 265(b) of the Code.]
The pledge of tax levies for payment of principal of and interest on
the bonds may be discharged prior to maturity of the bonds by making
provision for the payment thereof on the terms and conditions set forth in
the Bond Ordinance.
It is hereby certified that all acts, conditions and things required by
the Constitution and statutes of the State of Washington to exist and to
have happened, been done and performed precedent to and in the
issuance of this bond exist and have happened, been done and performed
and that the issuance of this bond and the bonds of this issue does not
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violate any constitutional, statutory or other limitation upon the amount of
bonded indebtedness that the City may incur.
IN WITNESS WHEREOF, the City of Kent, Washington has caused
this bond to be executed by the manual or facsimile signatures of the
Mayor and the City Clerk and the seal of the City imprinted, impressed or
otherwise reproduced hereon as of this _ day of 2014.
[SEAL]
CITY OF KENT,
WASHINGTON
By /s/ manual or facsimile
Mayor
ATTEST:
/s/ manual or facsimile
City Clerk
The Bond Registrar's Certificate of Authentication on the Bonds shall
be in substantially the following form:
CERTIFICATE OF AUTHENTICATION
This bond is one of the bonds described in the within-mentioned
Bond Ordinance and is one of the Limited Tax General Obligation
Refunding Bonds, 2014 of the City of Kent, Washington, dated
2014.
WASHINGTON STATE FISCAL
AGENCY, as Bond Registrar
By
SECTION 6. - Execution of Bonds. The Bonds shall be executed on
behalf of the City with the manual or facsimile signature of the Mayor and
attested by the manual or facsimile signature of the City Clerk and the
seal of the City shall be impressed, imprinted or otherwise reproduced
thereon.
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Only such Bonds as shall bear thereon a Certificate of
Authentication in the form hereinbefore recited, manually executed by the
Bond Registrar, shall be valid or obligatory for any purpose or entitled to
the benefits of this ordinance. Such Certificate of Authentication shall be
conclusive evidence that the Bonds so authenticated have been duly
executed, authenticated and delivered hereunder and are entitled to the
benefits of this ordinance.
In case either of the officers who shall have executed the Bonds
shall cease to be an officer or officers of the City before the Bonds so
signed shall have been authenticated or delivered by the Bond Registrar,
or issued by the City, such Bonds may nevertheless be authenticated,
delivered and issued and upon such authentication, delivery and issuance,
shall be as binding upon the City as though those who signed the same
had continued to be such officers of the City. Any Bond may be signed
and attested on behalf of the City by such persons who at the date of the
actual execution of such Bond, are the proper officers of the City, although
at the original date of such Bond any such person shall not have been
such officer of the City.
SECTION 7. - Refunding Plan; Application of Bond Proceeds.
(a) Refunding Plan. For the purpose of realizing a debt service
savings, the City proposes to defease and refund the Refunded Bonds as
set forth herein. The Refunded Bonds shall include all or a portion of the
Refunding Candidates as designated by the Designated Representative
and set forth in the Bond Purchase Contract. Proceeds of the Bonds shall
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be deposited with the Escrow Agent pursuant to the Escrow Deposit
Agreement to be used immediately upon receipt thereof to defease the
Refunded Bonds as authorized by the 2004 Bond Ordinance and to pay
costs of issuance of the Bonds.
The net proceeds deposited with the Escrow Agent shall be used to
defease the Refunded Bonds and discharge the obligations thereon by the
purchase of certain Government Obligations (which obligations so
purchased, are herein called "Acquired Obligations"), bearing such interest
and maturing as to principal and interest in such amounts and at such
times which, together with any necessary beginning cash balance, will
provide for the payment of:
(1) interest on the Refunded Bonds as such becomes due
on and prior to the Call Date; and
(2) the redemption price (100% of the principal amount)
of the Refunded Bonds on the Call Date.
Such Acquired Obligations shall be purchased at a yield not greater
than the yield permitted by the Code and regulations relating to acquired
obligations in connection with refunding bond issues.
(b) Escrow Agent/Escrow Deposit Agreement. The City hereby
appoints U.S. Bank National Association, Seattle, Washington, as the
Escrow Agent for the Refunded Bonds (the "Escrow Agent'). A beginning
cash balance, if any, and the Acquired Obligations shall be deposited
irrevocably with the Escrow Agent in an amount sufficient to defease the
Refunded Bonds. The proceeds of the Bonds remaining after acquisition of
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the Acquired Obligations and provision for the necessary beginning cash
balance shall be utilized to pay expenses of the acquisition and
safekeeping of the Acquired Obligations and costs of issuance of the
Bonds.
In order to carry out the purposes of this Section 7, the Finance
Director is authorized and directed to execute and deliver to the Escrow
Agent, an Escrow Deposit Agreement.
(c) Call for Redemption of Refunded Bonds. The City hereby sets
aside sufficient funds out of the purchase of Acquired Obligations from
proceeds of the Bonds to make the payments described above.
The City hereby calls the Refunded Bonds for redemption on their
Call Date in accordance with the provisions of the 2004 Bond Ordinance
authorizing the redemption and retirement of the 2004 Bonds, prior to
their fixed maturities.
Said defeasance and call for redemption of the Refunded Bonds
shall be irrevocable after the issuance of the Bonds and delivery of the
Acquired Obligations to the Escrow Agent.
The Escrow Agent is hereby authorized and directed to provide for
the giving of notices of the redemption of the Refunded Bonds in
accordance with the applicable provisions of the 2004 Bond Ordinance.
The costs of publication of such notices shall be an expense of the City.
The Escrow Agent is hereby authorized and directed to pay to the
Finance Director, or, at the direction of the Finance Director, to the paying
agent for the Refunded Bonds, sums sufficient to pay, when due, the
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payments specified in this Section 7. All such sums shall be paid from the
moneys and Acquired Obligations deposited with the Escrow Agent, and
the income therefrom and proceeds thereof. All such sums so paid to or
to the order of the Finance Director shall be credited to the Refunding
Account. All moneys and Acquired Obligations deposited with the Escrow
Agent and any income therefrom shall be held, invested (but only at the
direction of the Finance Director) and applied in accordance with the
provisions of this ordinance and with the laws of the State of Washington
for the benefit of the City and owners of the Refunded Bonds.
The City will take such actions as are found necessary to see that all
necessary and proper fees, compensation and expenses of the Escrow
Agent for the Refunded Bonds shall be paid when due.
SECTION B. - Tax Covenants.
The City covenants that it will not take or permit to be taken on its
behalf any action that would adversely affect the exemption from federal
income taxation of the interest on the Bonds 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 Bonds.
(a) Arbitrage Covenant. 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 proceeds of sale of the Bonds or any other
funds of the City which may be deemed to be proceeds of the Bonds
pursuant to Section 148 of the Code and the regulations promulgated
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thereunder which, if such use had been reasonably expected on the dates
of delivery of the Bonds to the initial purchasers thereof, would have
caused the Bonds to be treated as "arbitrage bonds" within the meaning of
such term as used in Section 148 of the Code. The City will comply with
the requirements of Section 148 of the Code and the applicable
regulations thereunder throughout the term of the Bonds.
(b) Private Person Use Limitation for the Bonds. The City
covenants that for as long as the Bonds are outstanding, it will not permit:
(1) More than 10% of the Net Proceeds of the Bonds to be
allocated to any Private Person Use; and
(2) More than 10% of the principal or interest payments
on the Bonds in a Bond Year to be directly or indirectly: (A) secured by
any interest in property used or to be used for any Private Person Use or
secured by payments in respect of property used or to be used for any
Private Person Use, or (B) derived from payments (whether or not made
to the City) in respect of property, or borrowed money, used or to be used
for any Private Person Use.
The City further covenants that, if:
(3) More than five percent of the Net Proceeds of the
Bonds are allocable to any Private Person Use; and
(4) More than five percent of the principal or interest
payments on the Bonds in a Bond Year are (under the terms of this
ordinance or any underlying arrangement) directly or indirectly:
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(A) secured by any interest in property used or to be
used for any Private Person Use or secured by payments in respect
of property used or to be used for any Private Person Use, or
(B) derived from payments (whether or not made to
the City) in respect of property, or borrowed money, used or to be
used for any Private Person Use, then, (i) any Private Person Use of
the projects described in subsection (3) hereof or Private Person
Use payments described in subsection (4) hereof that is in excess of
the five percent limitations described in such subsections (3) or (4)
will be for a Private Person Use that is related to the state or local
governmental use of the projects refunded by the proceeds of the
Bonds, and (ii) any Private Person Use will not exceed the amount
of Net Proceeds of the Bonds allocable to the state or local
governmental use portion of the projects(s) to which the Private
Person Use of such portion of the projects refunded by the proceeds
of the Bonds relate. The City further covenants that it will comply
with any limitations on the use of the projects refunded by the
proceeds of the Bonds by other than state and local governmental
users that are necessary, in the opinion of its bond counsel, to
preserve the tax exemption of the interest on the Bonds.
(c) Modification of Tax Covenants. The covenants of this section
are specified solely to assure the continued exemption from regular
income taxation of the interest on the Bonds. To that end, the provisions
of this section may be modified or eliminated without any requirement for
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formal amendment thereof upon receipt of an opinion of the City's bond
counsel that such modification or elimination will not adversely affect the
tax exemption of interest on any Bonds.
(d) In the Federal Tax Certificate the City may designate the
Bonds as "qualified tax-exempt obligations" under Section 265(b)(3) of
the Code for investment by financial institutions if at the time of such
designation it reasonably does not expect to issue more than $10,000,000
in qualifying tax-exempt debt during calendar year 2014.
SECTION 9. - Bond Fund and Provision for Tax Levy Payments.
The City hereby authorizes the creation of a fund to be used for the
payment of debt service on the Bonds, designated as the "City of Kent
Limited Tax General Obligation Bond Debt Service Fund, 2014" (the "Bond
Fund"). No later than the date each payment of principal of or interest on
the Bonds becomes due, the City shall transmit sufficient funds, from the
Bond Fund or from other legally available sources, to the Bond Registrar
for the payment of such principal or interest. Money in the Bond Fund
may be invested in legal investments for City funds.
The City hereby irrevocably covenants and agrees for as long as any
of the Bonds are outstanding and unpaid that each year it will include in
its budget and levy an ad valorem tax upon all the property within the City
subject to taxation in an amount that will be sufficient, together with all
other revenues and money of the City legally available for such purposes,
to pay the principal of and interest on the Bonds when due.
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The City hereby irrevocably pledges that the annual tax provided for
herein to be levied for the payment of such principal and interest shall be
within and as a part of the tax levy permitted to cities without a vote of
the people, and that a sufficient portion of each annual levy to be levied
and collected by the City prior to the full payment of the principal of and
interest on the Bonds will be and is hereby irrevocably set aside, pledged
and appropriated for the payment of the principal of and interest on the
Bonds. The full faith, credit and resources of the City are hereby
irrevocably pledged for the annual levy and collection of said taxes and for
the prompt payment of the principal of and interest on the Bonds when
due.
SECTION 10. - Defeasance. In the event that the City, to effect
the payment, retirement or redemption of any Bond, sets aside in the
Bond Fund or in another special account, cash or noncallable Government
Obligations, or any combination of cash and/or noncallable Government
Obligations, in amounts and maturities which, together with the known
earned income therefrom, are sufficient to redeem or pay and retire such
Bond in accordance with its terms and to pay when due the interest and
redemption premium, if any, thereon, and such cash and/or noncallable
Government Obligations are irrevocably set aside and pledged for such
purpose, then no further payments need be made into the Bond Fund for
the payment of the principal of and interest on such Bond. The owner of a
Bond so provided for shall cease to be entitled to any lien, benefit or
security of this ordinance except the right to receive payment of principal,
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premium, if any, and interest from the Bond Fund or such special account,
and such Bond shall be deemed to be not outstanding under this
ordinance.
The City shall give written notice of defeasance to the owners of all
Bonds so provided for within 30 days of the defeasance and to each party
entitled to receive notice in accordance with Section 12.
SECTION 11. - Sale of Bonds.
(a) Bond Sale. The Bonds shall be sold at negotiated sale to the
Underwriter pursuant to the terms of the Bond Purchase Contract. The
Financial Advisor has advised the Council that market conditions are
fluctuating and, as a result, the most favorable market conditions may
occur on a day other than a regular meeting date of the Council. The
Council has determined that it would be in the best interest of the City to
delegate to the Designated Representative for a limited time the authority
to approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, selection of the Refunded Bonds,
and redemption rights.
The Designated Representative is hereby authorized to designate a
portion or all of the Refunding Candidates as Refunded Bonds, and to
approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, and redemption rights for the
Bonds in the manner provided hereafter so long as (i) the aggregate
principal amount of the Bonds does not exceed $14,000,000, (ii) the final
maturity date for the Bonds is no later than December 1, 2021, (iii) the
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Bonds are sold (in the aggregate) at a price not less than 97% and not
greater than 120%, (iv) the Bonds are sold for a price that results in a
minimum net present value debt service savings over the Refunded Bonds
of at least 3.0%, (v) the true interest cost for the Bonds (in the
aggregate) does not exceed 3.5%; and (vi) the Bonds conform to all other
terms of this ordinance. Subject to the terms and conditions set forth in
this section, the Designated Representative is hereby authorized to
execute the Bond Purchase Contract.
Following the execution of the Bond Purchase Contract, the Finance
Director shall provide a report to the Council describing the final terms of
the Bonds approved pursuant to the authority delegated in this section.
The authority granted to the Designated Representative by this Section 11
shall expire 120 days after the effective date of this ordinance. If a Bond
Purchase Contract for the Bonds has not been executed within 120 days
after the effective date of this ordinance, the authorization for the
issuance of the Bonds shall be rescinded, and the Bonds shall not be
issued nor their sale approved unless such Bonds shall have been re-
authorized by ordinance of the Council. The ordinance re-authorizing the
issuance and sale of such Bonds may be in the form of a new ordinance
repealing this ordinance in whole or in part or may be in the form of an
amendatory ordinance approving a bond purchase contract or establishing
terms and conditions for the authority delegated under this Section 11.
(b) Delivery of Bonds; Documentation. Upon the passage and
approval of this ordinance, the proper officials of the City, including the
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Finance Director and Chief Administrative Officer, are authorized and
directed to undertake all action necessary for the prompt execution and
delivery of the Bonds to the Underwriter and further to execute all closing
certificates and documents required to effect the closing and delivery of
the Bonds in accordance with the terms of this ordinance and the Bond
Purchase Contract.
(c) Preliminary and Final Official Statements. The Finance
Director is hereby authorized to ratify and to deem final the preliminary
Official Statement relating to the Bonds for the purposes of the Rule. The
Finance Director is further authorized to ratify and to approve for purposes
of the Rule, on behalf of the City, the final Official Statement relating to
the issuance and sale of the Bonds and the distribution of the final Official
Statement pursuant thereto with such changes, if any, as may be deemed
by her to be appropriate.
SECTION 12. - Undertaking to Provide Ongoing Disclosure.
(a) Contract/Undertaking. This section constitutes the City's
written undertaking for the benefit of the owners, including Beneficial
Owners, of the Bonds as required by Section (b)(5) of the Rule.
(b) Financial Statements/Operating Data. The City agrees to
provide or cause to be provided to the MSRB the following annual financial
information and operating data for the prior fiscal year (commencing in
2014 for the fiscal year ended December 31, 2013):
1. Annual financial statements, which statements may or
may not be audited, showing ending fund balances for the City's general
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fund prepared in accordance with the Budgeting Accounting and Reporting
System prescribed by the Washington State Auditor pursuant to
RCW 43.09.200 (or any successor statute) and generally of the type
specified in the official statement for the Bonds;
2. The assessed valuation of taxable property in the City;
3. Ad valorem taxes due and percentage of taxes
collected;
4. Property tax levy rate per $1,000 of assessed
valuation; and
5. Outstanding general obligation debt of the City.
Items 2-5 shall be required only to the extent that such information is not
included in the annual financial statements.
The information and data described above shall be provided on or
before nine months after the end of the City's fiscal year. The City's
current fiscal year ends December 31. The City may adjust such fiscal
year by providing written notice of the change of fiscal year to the MSRB.
In lieu of providing such annual financial information and operating data,
the City may cross-reference to other documents available to the public on
the MSRB's internet website or filed with the Commission.
If not provided as part of the annual financial information discussed
above, the City shall provide to the MSRB the City's audited annual
financial statements prepared in accordance with the Budgeting
Accounting and Reporting System prescribed by the Washington State
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Auditor pursuant to RCW 43.09.200 (or any successor statute) when and if
available.
(c) Listed Events. The City agrees to provide or cause to be
provided to the MSRB, in a timely manner not in excess of ten business
days after the occurrence of the event, notice of the occurrence of any of
the following events with respect to the Bonds:
• Principal and interest payment delinquencies;
• Non-payment related defaults, if material;
• Unscheduled draws on debt service reserves reflecting
financial difficulties;
• Unscheduled draws on credit enhancements reflecting
financial difficulties;
• Substitution of credit or liquidity providers, or their failure to
perform;
• Adverse tax opinions, the issuance by the Internal Revenue
Service of proposed or final determinations of taxability,
Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax
status of the Bonds, or other material events affecting the tax
status of the Bonds;
• Modifications to the rights of Bondholders, if material;
• Bond calls, if material, and tender offers;
• Defeasances;
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• Release, substitution, or sale of property securing repayment
of the Bonds, if material;
• Rating changes;
• Bankruptcy, insolvency, receivership or similar event of the
City;
• The consummation of a merger, consolidation, or acquisition
involving the City or the sale of all or substantially all of the
assets of the City, other than in the ordinary course of
business, the entry into a definitive agreement to undertake
such an action or the termination of a definitive agreement
relating to any such actions, other than pursuant to its terms,
if material; and
• Appointment of a successor or additional trustee or the
change of name of a trustee, if material.
The City shall promptly determine whether the events described above are
material.
(d) Format for Filings with the MSRB. All notices, financial
information and operating data required by this undertaking to be
provided to the MSRB must be in an electronic format as prescribed by the
MSRB. All documents provided to the MSRB pursuant to this undertaking
must be accompanied by identifying information as prescribed by the
MSRB.
(e) Notification Upon Failure to Provide Financial Data. The City
agrees to provide or cause to be provided, in a timely manner, to the
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MSRB notice of its failure to provide the annual financial information
described in Subsection (b) above on or prior to the date set forth in
Subsection (b) above.
(f) Termination/Modification. The City's obligations to provide
annual financial information and notices of certain listed events shall
terminate upon the legal defeasance, prior redemption or payment in full
of all of the Bonds. Any provision of this section shall be null and void if
the City (1) obtains an opinion of nationally recognized bond counsel to
the effect that the portion of the Rule that requires that provision is
invalid, has been repealed retroactively or otherwise does not apply to the
Bonds and (2) notifies the MSRB of such opinion and the cancellation of
this section.
The City may amend this section with an opinion of nationally
recognized bond counsel in accordance with the Rule. In the event of any
amendment of this section, the City shall describe such amendment in the
next annual report, and shall include a narrative explanation of the reason
for the amendment and its impact on the type (or in the case of a change
of accounting principles, on the presentation) of financial information or
operating data being presented by the City. In addition, if the amendment
relates to the accounting principles to be followed in preparing financial
statements, (A) notice of such change shall be given in the same manner
as for a listed event under Subsection (c), and (B) the annual report for
the year in which the change is made shall present a comparison (in
narrative form and also, if feasible, in quantitative form) between the
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financial statements as prepared on the basis of the new accounting
principles and those prepared on the basis of the former accounting
principles.
(g) Bond Owner's Remedies Under This Section. The right of any
bondowner or Beneficial Owner of Bonds to enforce the provisions of this
section shall be limited to a right to obtain specific enforcement of the
City's obligations under this section, and any failure by the City to comply
with the provisions of this undertaking shall not be an event of default
with respect to the Bonds.
(h) No Default. Except as otherwise disclosed in the City's official
statement relating to the Bonds, the City is not and has not been in
default in the performance of its obligations of any prior undertaking for
ongoing disclosure with respect to its obligations.
SECTION 13. - Lost, Stolen or Destroyed Bonds. In case any
Bond or Bonds shall be lost, stolen or destroyed, the Bond Registrar may
execute and deliver a new Bond or Bonds of like date, number and tenor
to the Registered Owner thereof upon the Registered Owner's paying the
expenses and charges of the City and the Bond Registrar in connection
therewith and upon his/her filing with the City evidence satisfactory to the
City that such Bond was actually lost, stolen or destroyed and of his/her
ownership thereof, and upon furnishing the City and/or the Bond Registrar
with indemnity satisfactory to the City and the Bond Registrar.
SECTION 14. - Severability; Ratification. If any one or more of
the covenants or agreements provided in this ordinance to be performed
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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 deemed
separable from the remaining covenants and agreements of this ordinance
and shall in no way affect the validity of the other provisions of this
ordinance or of the Bonds. All acts taken pursuant to the authority
granted in this ordinance but prior to its effective date are hereby ratified
and confirmed.
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SECTION 15. - Effective Date of Ordinance. This ordinance shall
take effect and be in force five days after its passage, approval, and
publication as provided by law.
Adopted by the City Council of the City of Kent, Washington, at a
regular meeting thereof held this 4th of February, 2014.
By
Suzette Cooke, Mayor
ATTEST
Ronald F. Moore, MMC, City
Clerk
APPROVED AS TO FORM:
PACIFICA LAW GROUP LLP
Bond Counsel
PASSED: of February, 2014
APPROVED: of February, 2014
PUBLISHED: of February, 2014
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Limited Tax General Obligation Refunding Bonds, 2014
CERTIFICATION
I, the undersigned, City Clerk of the City of Kent, Washington (the
"City"), hereby certify as follows:
1. The attached copy of Ordinance No. (the
"Ordinance") is a full, true and correct copy of an ordinance duly passed at
a regular meeting of the City Council of the City held at the regular time
and meeting place thereof on February 4, 2014, as that ordinance appears
on the minute book of the City; and the Ordinance will be in full force and
effect after its passage; and
2. A quorum of the members of the City Council was present
throughout the meeting and a majority of those members present voted in
the proper manner for the passage of the Ordinance.
IN WITNESS WHEREOF, I have hereunto set my hand this 4th day
of February, 2014.
CITY OF KENT, WASHINGTON
Ronald F. Moore, MMC, City Clerk
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KENT
Agenda Item: Consent — 7F
TO: City Council
DATE: February 4, 2014
SUBJECT: Budget Certification for Annexation Sales Tax Credit Resolution — Adopt
MOTION: Move to adopt Resolution No. , approving the certification
of $4,230,777 for the Panther Lake annexation sales tax credit for the
period July 1, 2014 through June 30, 2015.
SUMMARY: The City is required to certify to the state of Washington before March Vt
of each year, the amount needed from the annexation sales tax credit to provide
services in the annexed area. The Finance Department has calculated the costs and
revenues within the Panther Lake annexation area and has determined a gap between
revenues generated and expenditures used to provide services of $4,230,777 for July
1, 2014 through June 30, 2015.
EXHIBITS: Resolution
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: The budget for the Panther Lake annexation area for the State's
fiscal year 2013 is anticipated to be $11,949,899 in expenditures to provide City
services to those residents, while we anticipate revenues of $7,719,122 from property
taxes, sales taxes and other sources. The net of the revenues and costs produces a
deficit of $4,230,777 which is the amount being certified as the amount of annexation
sales tax credit we are requesting from the State.
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RESOLUTION NO.
A RESOLUTION of the City Council of the
City of Kent, Washington, determining a new
threshold amount for the sales and use tax
authorized by RCW 82.14.415 and codified in
Chapter 3.27 of the Kent City Code, relating to the
cost of providing municipal services to the Panther
Lake Annexation Area for the 2014 fiscal year, and
authorizing the Finance Director to certify the
threshold amount to the Washington State
Department of Revenue.
RECITALS
A. RCW 82.14.415 authorizes the City to impose a sales and use
tax as a credit against state retail sales and use taxes collected under
Chapters 82.08 and 82.12 RCW to assist the City in providing municipal
services to newly annexed areas.
B. After providing all appropriate notice and following appropriate
procedure, and following a favorable vote on the annexation proposition,
the Kent City Council adopted Ordinance No. 3936 on December 8, 2009,
approving the Panther Lake Annexation Area effective July 1, 2010. The
population within the annexation area determined at the time of
annexation was 25,458 people.
1 Tax Credit Threshold
Panther Lake Annexation
C. On February 16, 2010, the City Council passed Ordinance No.
3947, creating Chapter 3.27 of the Kent City Code and imposing the sales
and use tax at the rate of 0.2 percent.
D. On February 15, 2011, the City Council adopted Resolution
No. 1839 confirming the tax rate at 0.2 percent and authorizing the finance
director to certify the threshold amount for the 2011 fiscal year.
E. On February 7, 2012, through Resolution No. 1853, the City
Council adopted a new threshold amount for the 2012 fiscal year and
authorized the finance director to certify the same.
F. On February 19, 2013, through Resolution No. 1871, the City
Council adopted a new threshold amount for the 2013 fiscal year and
authorized the finance director to certify the same.
G. With this Resolution, the City authorizes the imposition of
similar annexation sales and use taxes for the 2014 fiscal year.
H. The City Council of the city of Kent, Washington, finds and
determines that the projected cost to provide municipal services to the
Panther Lake Annexation Area for the 2014 fiscal year will be at least
$11,949,899, and that this cost exceeds the projected general revenue
that the City would otherwise receive from the annexation during the 2014
fiscal year, which is estimated to be $7,719,122.
I. Pursuant to RCW 82.14.415, the city of Kent is authorized,
under the circumstances of this annexation, to impose a sales and use tax
for the 2014 fiscal year, which shall be collected by the State department
of revenue from those persons who are taxable by the state under
2 Tax Credit Threshold
Panther Lake Annexation
Chapters 82.08 and 82.12 RCW, upon the occurrence of any taxable event
within the City.
J. The rate of tax imposed shall be 0.2 percent, and shall be in
addition to other taxes authorized by law, and the threshold amount for the
2014 fiscal year is $4,230,777.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON, DOES HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Rate and Threshold Amount. The Kent City Council
determines that the threshold amount for the City's projected net cost in
providing municipal services to the Panther Lake Annexation Area for the
2014 fiscal year is $4,230,777. The City Council previously imposed a sales
and use tax at the rate of 0.2 percent, with the passage of Ordinance No.
3947 on February 16, 2010.
SECTION 2, - Implementation and certification. The Mayor of the
city of Kent is authorized to implement administrative procedures as may
be necessary to carry out the provisions of this resolution. The City's
Finance Director is authorized to certify the amount for the 2014 fiscal year
to the appropriate agencies within the State of Washington.
SECTION 3, - Severability. If any section, subsection, paragraph,
sentence, clause or phrase of this resolution is declared unconstitutional or
invalid for any reason, such decision shall not affect the validity of the
remaining portions of this resolution.
3 Tax Credit Threshold
Panther Lake Annexation
SECTION 4, - Savings. Resolution No. 1871 shall remain in full
force and effect until the effective date of this resolution.
SECTIONS. - Ratification. Any act consistent with the authority
and prior to the effective date of this resolution is hereby ratified and
affirmed.
SECTION 6, - Corrections by City Clerk or Code Reviser. Upon
approval of the City Attorney, the City Clerk and the code reviser are
authorized to make necessary corrections to this resolution, including the
correction of clerical errors; references to other local, state or federal laws,
codes, rules, or regulations; or resolution numbering and
section/subsection numbering.
SECTION 7, - Effective Date. This resolution shall take effect and
be in force immediately upon its passage, however the imposition of the
sales and use taxes for the 2014 state fiscal year authorized by this
resolution shall not take effect until the commencement of that fiscal year.
PASSED at a regular open public meeting by the City Council of the
city of Kent, Washington, this day of 2014.
CONCURRED in by the Mayor of the city of Kent this day of
2014.
SUZETTE COOKE, MAYOR
4 Tax Credit Threshold
Panther Lake Annexation
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR "PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the City Council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK
P:\Civil\I solution\Mnexadon Sales Tax Threshold2014.docx
5 Tax Credit Threshold
Panther Lake Annexation
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KENT
Agenda Item: Consent - 7G
TO: City Council
DATE: February 4, 2014
SUBJECT: Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. - Authorize
MOTION: Authorize the Mayor to sign a contract with Petersen Brothers
Construction, Inc. to perform emergency repairs of damaged guardrails on
an as needed basis in an amount not to exceed $20,000, subject to final
terms and conditions acceptable to the City Attorney and Public Works
Director.
SUMMARY: The city typically has several guardrails that are damaged or destroyed
each year by vehicles due to severe weather or inattentive drivers. In the past we
have spent time soliciting bids for each repair. Petersen Brothers is the only business
that consistently responds and at this time is the sole provider for this service in the
region.
We are requesting the approval of this contract to be able to expedite repairs.
EXHIBITS: None
RECOMMENDED BY: Public Works Committee
YEA: Berrios - Ralph - Higgins NAY:
BUDGET IMPACTS: Funds would be made available by Council through the use of
Business and Occupation Tax.
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KENT
Agenda Item: Consent - 7H
TO: City Council
DATE: February 4, 2014
SUBJECT: 2013 Crack Sealing Project Completion - Accept
MOTION: Accept the 2012 Crack Sealing Project as complete and release
retainage to C.R. Contracting, upon receipt of standard releases from the
state and the release of any liens.
SUMMARY: Crack sealing is a maintenance treatment used to prevent water from
infiltrating cracks in a roadway. When water infiltrates cracks, it leads to accelerated
damage of the roadway. Historically, Public Works Operations crews have performed
crack sealing. Our crews still perform a significant amount of crack sealing work
annually; however, the volume of work has exceeded the time available for in-house
personnel. Therefore, several roadways in the valley were identified to have crack
sealing performed by a Contractor. The original contract amount was $195,300.00.
The final contract amount was $194,194.70.
The project consisted of installing approximately 18 tons of rubberized asphalt for
crack sealing on Central Avenue South, West Valley Highway, 84th Avenue South, 64th
Avenue South, Meeker Street and several industrial streets in the northwest corner of
the city.
The contract is now complete and ready for Council acceptance.
EXHIBITS: None
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS: This project was funded from the Business & Occupation tax
revenue.
This item did not need to be brought to Committee.
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KENT
Agenda Item: Consent - 7I
TO: City Council
DATE: February 4, 2014
SUBJECT: Oakleigh I & II Bill of Sale- Accept
MOTION: Accept the Bill of Sale for the Oakleigh I & II project, permit
2071420, for 28 gate valves, 5 hydrants, and 3,816 linear feet of waterline;
17 sanitary sewer manholes, and 2,747 linear feet of sanitary sewerline;
384 linear feet of new curb and gutter, 272 linear feet of new sidewalk, 2
street lights, and 6 street trees; 1 storm sewer catch basin, and 320 linear
feet of storm sewerline.
SUMMARY: The Oakleigh I & II project is located at 27919 106th Ave. SE; parcel
#3222059089.
EXHIBITS: Oakleigh I & II Bill of Sale
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS:
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MAIL TO:
CITY OF KENT
ENGINEERING DEPARTMENT
ATTN: Ozzie Carrasquilla
�Aj 220 — 4T" AVENUE SOUTH
WASH IN a T O a KENT, WASHINGTON 98032
Project: Oakleigh I & II
CITY OF KFNT Permit #:_RECC-2071420
JUN Q 5 201.E Location: 108" Avenue SE at SE 279th Street
ENGINEERING UEP I Parcel #: 322205-9094. -9089. -9095, -9122, -9137
BILL OF SALE
CITY OF KENT
KING COUNTY, WASHINGTON
THIS INSTRUMENT made this 12th day of April 2013, by and between Henley USA LLC, hereinafter
called "Grantors", and City of Kent, a municipal corporation of King County, State of Washington, hereinafter
called
"Grantee":
WITNESSETH:
That the said Grantors for a valuable consideration does hereby grant, bargain, sell to Grantee the following
described improvements:
A. WATERMAINS:
Together with a total of 28 gate valves at $800.00 each, 5 hydrants at $4,200 each and/or any other
appurtenances thereto.
ON FROM TO
SE 2Both Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
1071h Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 3,816 linear feet at $42.00 per LF of 8" D.I. waterline, and
300 linear feet at $50.00 per LF of 12" D.I. waterline.
Bill of Sale 14369.036.doc
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B. SANITARY SEWERS:
Together with a total of 17 manholes at $3,200.00 each and/or any other appurtenances thereto.
ON FROM TO
SE 2801h Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
107" Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 2,747 linear feet at $38.00 per LF of 8" PVC sewerline, and
611 linear feet at $50.00 per LF of 12" PVC sewerline.
C. FRONTAGEIMPROVEMENTS:
Together with lights, trees, landscaping (except residential streets) and/or any other appurtenances
ON FROM M
1081h Avenue SE SE 279th Street SE 278t" Street
Including 384 linear feet at $8.00 per LF of concrete curb and gutter, and
272 linear feet at $12.00 per LF of 6-foot concrete sidewalk, and
2 street lights at $6,500.00 each, and
6 street trees at $300.00 each.
D. STORM SEWERS:
Together with a total of 5 Type I catch basins at $950.00 each, and/or any other appurtenances
thereto.
ON FROM TO
1081h Avenue SE SE 279th Street SE 278th Street
Including 320 linear feet at $28.00 per LF of 12" PVC sewerline.
To have and to hold the same to the said Grantee, its successors and assigns forever.
The undersigned hereby covenants that it is the lawful owner of said property; and that the same is free
from all encumbrances; that all bills for labor and materials have been paid; that it has the right to sell the
same aforesaid; that it will warrant and defend the same against the lawful claims and demand of all
person(s).
The Bill of Sale is given on consideration of the agreement of the Grantee for itself, its successors and
assigns to incorporate said utilities in its utility system and to maintain them as provided in the applicable
City Ordinances. The City accepts the items subject to staff approval and completion of a 2 year
maintenance period.
Bill of Sale 1436e.036.doc
2of5
IN WITNCEESS WHEREOF, the undersigned has caused this instrument to be executed on this
L t day of 2013.
��V v,-..L,'f'\'Jv-- i=`�- L-Li.u1.C�; N'lfi,Vtet.�a• r�:,_�'._.. '..
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed on this
day of 2013,
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this day of 2013, before me, .the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared to me known to be the individual described in and
who executed the foregoing instrument, and acknowledged to me that he/she signed and sealed this
instrument as his/her free and voluntary act and deed for the uses and purposes therein mentioned.
GIVEN under my hand and official seal this day of 2013.
Notary Public in and for the State of
Washington, residing at
My Commission Expires:
Bill of Sale 14369.036.doc
3 of 5
i
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this is day of Y 2013, before me, the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared f�t' t (`--&A1/e-// and to me to be the
PJ �c�P (,.bvo6 4d" d respectively of
FiR/ � dA the�7G�M ;,Ce®/ G>'40,IAX l"rx that executed the foregoing
instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said
Gf-C for the uses and purposes therein mentioned, and on oath stated that
they are authorized to execute the said instrument.
Witness my hand and official seal hereto affix the day and year first above written.
�449bRSGilytrid�,��
�«•�@i,�Qp1NTih�ry,„•.,/Js�se. ,€ll .�' .l.�s�iwr �
:0°4. Notary Public IW and for the ate of
*, 30 w.Z_ Washington, residing at
2014
?BeR AitP16 �0`��`` My Commission Expires:
The Bill of Sale is given and accepted pursuant to a motion duly made, seconded, and passed by the City
Council of the City of Kent, King County, Washington, on the day of
2013.
Bill of Sale 14369.036.doc
4of5
FO
i
WASHINGTON it
ENGINEER'S CERTIFICATION
CITY OF KENT
KING COUNTY, WASHINGTON
The figures used on the Bill of Sale for the Oakleigh I and II project dated April 12,
2013, for the same said Oakleigh I and II project. Chris Jensen, the undersigned
P.E. or land surveyor is the person responsible for the preparation of the Bill of Sale and
is an employee of Barghausen Consulting Engineers, Inc., the firm responsible for
the preparation of the record drawings.
�R1S JEFys�
evA �C
O 4 11111�
Sigr ature
(Engineer stamp required)
Bill of Sale 14369.036.doc
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KENT
Agenda Item: Other Business — 8A
TO: City Council
DATE: February 4, 2014
SUBJECT: Financial policy Resolution - Adopt
MOTION: Move to adopt Resolution No. , repealing Resolution No.
1859, amending financial policies to be used for guidance when enacting
and amending the city budget.
SUMMARY: This resolution amends the city's financial policies by clarifying the
requirements and available uses for the city's Strategic Opportunities Fund, first, by
confirming that non-recurring revenues only be applied to non-recurring expenses,
and second, by confirming that monies will not be spent out of this fund unless the
council first approves the expenditure.
Additionally, we have added a new, aspirational goal designed to obtain exceptional
financial stability by increasing our total government fund balance to a point where it
should carry the city through future economic downturns.
EXHIBITS: Resolution and Exhibit
RECOMMENDED BY: Operations Committee
YEA: Thomas — Ralph — Boyce (post meeting) NAY:
BUDGET IMPACTS: None
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RESOLUTION NO.
A RESOLUTION of the city council of the
city of Kent, Washington, repealing Resolution
1859 and adopting financial, accounting, and
budgetary policies intended to provide short and
long-term guidance to city staff for the purpose of
achieving financial stability and achieving goals
established in the City Council's Strategic Plan.
RECITALS
A. As the council developed its strategic plan, it also created a new set
of financial, accounting and budgetary policies that are intended to offer
short and long-term guidance to city staff as the city moves toward
accomplishing the goals established in the strategic plan. The council
adopted these financial policies by resolution on June 5, 2012.
B. Since implementing these policies, the council has determined that
certain policies, such as the policy pertaining to the city's "Strategic
Opportunities Fund," need clarification. Further, in order to be best
prepared for future economic downturns, the policies have been amended
to add an aspirational goal of building a solid financial reserve for all city
funds.
C. Just as the strategic plan reflects goals and a vision the city strives
to achieve, these amended policies reflect the financial goals and vision for
the city. Accordingly, the council implements these policies today with the
1 Financial Policies Resolution
understanding that not all goals can be achieved immediately, but rather
will be achieved over time.
THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES
HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Recitals. The foregoing recitals are incorporated by
this reference.
SECTION 2, - Repealer. Resolution No. 1859, adopted on June 5,
2012, is repealed in its entirety.
SECTION 3, - Policies Adopted. The city of Kent Financial Policies
attached as Exhibit A are adopted.
SECTION 4, - Severabilitv. If any one or more section, subsection,
or sentence of this resolution is held to be unconstitutional or invalid, that
decision shall not affect the validity of the remaining portion of this
resolution and that remaining portion shall maintain its full force and
effect.
SECTION S. - Effective Date. This resolution shall take effect and
be in force immediately upon its passage.
PASSED at a regular open public meeting by the city council of the
city of Kent, Washington, this day of 2014.
SUZETTE COOKE, MAYOR
2 Financial Policies Resolution
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR 11PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the city council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK (SEAL)
P:\Civil\Pesolution\financial Policies 2014.docx
3 Financial Policies Resolution
FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves — The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund — The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise. For the
purposes of this section, "investment opportunities" includes expenditures intended to
increase city revenues or decrease operating or capital costs. To the extent the balance in this
fund is not from a recurring revenue source, it should only be utilized for a non-operating
purpose or one time expenditure. In addition, any appropriation from this fund must first be
approved by the City Council. In the event any of this fund is used in an economic downturn to
stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projects or capital projects that reduce
recurring operational expenditures. This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs — The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of $1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its $1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational goal, the City shall maintain a
total governmental fund balance of twice the greatest volatility in year over year changes in
total revenues or $30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
Exhibit A
OPERATING BUDGET POLICIES
City Target Issues-The City Council will update its strategic plan in the early spring of each year. The
staff will use this plan for development of the following year's budget priorities and the next biennial
budget.
Budget Kickoff—The Mayor and City Council shall meet in the Spring of even numbered years to plan
the following biennial budget and agree on the anticipated revenues on which the preliminary budget will
be based. The City Council shall review revenue estimates and preview potential changes to revenues.
The City Council shall then approve the revenue amount that will be used by the Mayor to form the initial
preliminary budget. The Mayor and City Council will meet additionally in late Summer to re-review the
revenue estimates to adjust them more closely to the additional revenue information that has become
available with the passage of time. Any changes resulting from this meeting shall be incorporated into
the preliminary budget to be considered by City Council.
Program Reviews — The Mayor shall perform a periodic review of staff and programs of the City for
both efficiency and effectiveness.Alternate methods of delivery will be evaluated for providing services.
Programs that are determined to be inefficient, ineffective, or inconsistent with the City Council's
strategic goals shall be reduced in scope or eliminated.
Preliminary Budget — The Mayor shall propose a preliminary budget in the Fall of even numbered
years. The preliminary budget will be developed in accordance with the revenues approved by the City
Council at the budget kickoff as amended. If the preliminary budget is based on revenues in excess of
those approved by City Council,the Mayor will present the justification for the increased revenues or the
additional proposed revenue sources.
Structurally Balanced Budget—The Mayor shall present, and the City Council shall adopt a budget in
which ongoing revenues equal or exceed ongoing expenditures. One time revenues shall not be used
to pay for recurring expenditures.
Conservative Expenditure Budgeting-The City will maintain its conservative expenditure budgeting
with respect to budgeting existing full time positions for a full year.
Acceptance of Grants —The City shall review any requirements for ongoing costs from any grant for
operational purposes. Any requirement to fund any portion of the costs as a condition of receipt of the
grant shall be a consideration in the decision to accept or reject the grant.
Self Supporting Proprietary Funds-The City's water, sewer and golf course enterprise funds will be
self supporting along with its internal service funds. The cost of providing services is expected to be
fully funded from charges for the service. If the funds produce a loss, rates will be adjusted to achieve,
at minimum, a break even status. If debt has been issued which requires a certain level of return, rates
and charges will be adjusted to achieve those returns.
Health Insurance Reserves — The target reserve for the Health Insurance Fund shall be two times
IBNR.
Full Cost of Service — The City will define its basic services to our residents. The services will be
evaluated as to their full cost. This information will be incorporated and presented as a section of the
annual budget.
Exhibit A
REVENUE AND COLLECTIONS
Aggressive Collection Effort- The City will follow an aggressive policy of collecting all monies due the
City to the extent that the collection efforts remain cost effective.
Reimbursements on a timely basis—Many grants occur on a cost reimbursement basis. To maximize
the City's available investable funds, reimbursement should be pursued on a timely basis.
User Charges Related to Costs - The City will review fees and charges on an annual basis and will
modify charges to adequately keep pace with increasing costs of providing services.
User Charges and Taxes Related to Market Rates- The City will consider its user charges and its tax
rates in connection with those of comparable sized communities and similar service providers, so that it
will provide reasonable rates to maintain its advantage in the market place in attracting businesses and
residences to the City of Kent.
CAPITAL BUDGETING
Committed Special Revenue Funds - The City will maintain its practice of designating its street and
capital improvement revenue sources including a percentage of its sales tax collections for the funding of
its capital improvement program.
Capital Improvement Program - The City will update its capital facilities plan on an annual basis as
required by the Growth Management Act. A preliminary plan will be established early in the budgeting
process to serve as a guideline during the year,with a final amendment adopted with the adoption of the
operating budgets to reflect the necessary changes in the City's Comprehensive Plan.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should issue
debt only for major capital projects. Debt should only be authorized for projects where the life of the
asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments on
outstanding debt shall be the highest priority before payment for other capital expenditures.
Bond Rating-The Citywill continue to strive to improve its bond rating by improving its financial stability.
Debt Capacity - The City strives to maintain adequate available debt capacity for large top priority
projects.
Bonding Limitations— Direct General Obligation Debt will not exceed 1.5% of assessed value; direct
and indirect debt will not exceed 4% of assessed value; duration of the debt will not exceed 15 years.
Revenue Debt Covenants—Will be based on the volatility of the revenues.
Arbitrage regulations—Will be strictly followed.
Special Assessment Guaranty Fund-The City will strive to maintain adequate reserves for retirement
of special assessment debt through the maintenance of a special assessment guaranty fund at least 10%
of outstanding special assessment debt.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost effective to
both the borrowing and the lending fund, and the funds will not be needed by the loaning fund during the
term of the loan. Such borrowing shall implement Council directed policy in a simplified manner, such as
borrowing associated with interim financing for local improvement district projects. A repayment plan
Exhibit A
should be approved along with the loan. The Mayor may approve loans for a term of one year. The
Council must approve loans with terms longer than one year.
INVESTMENT POLICY
Investment Security&Earnings Maximization-An investment policy was implemented per Ordinance
#3278 in 1996 which detail the City's investment guidelines. The primary objective is to preserve the
principal of the investment portfolio while maximizing the portfolio's return.
FINANCIAL REPORTING
Reporting frequency — Monthly budget and actual reports will be available to departments and a
quarterly report will be presented to the City Council Operations Committee.
Annual Report—Will be completed within 180 days.
Reporting Improvements-The City will strive to continue to make improvements in its financial reporting
scheme so that information available to the public,the City's governing bodies and other city departments
is timely and the best available for sound financial decisions.
Bondholders'Report— The City will prepare an annual report to bondholders.
Full Disclosure—All public reports will contain full and complete disclosure of all material matters.
Financial Trend Monitoring - The City will develop a program to evaluate its financial condition and
establish a system for correcting any deficiencies noted.
Annual Audits - The City will assist the State Auditor's Office in whatever way possible in conjunction
with the preparation of the annual audit,and will implement modifications identified bythe State Auditorto
improve the City's internal control and financial practices.
Updates to these Policies—The Operations Committee of the City Council shall review these policies at
least every four years. It is recommended that the review is done biennially during the budget process.
Exhibit A
ACCOUNTING
Generally Accepted Accounting Principles-The City will maintain its position as a leader in producing
financial reports in conformance with generally accepted accounting principles and pronouncements by
the Governmental Accounting Standards Board.
Basis of Accounting - The basis for accounting for the general fund, special revenue, debt service,
capital projects and agency funds is modified accrual. Modified accrual recognizes revenues when they
become both measurable and available to finance expenditures of the current period. The basis of
accounting forthe enterprise, internal service funds and pension trustfund is full accrual. The appropriate
basis is used throughout the budgeting, accounting and reporting processes, with few exceptions as
noted below. Full accrual is a method of accounting that matches revenues and expenses with the period
to which they relate, rather than focusing on actual cash flows. In this method, for example, an asset is
depreciated as it is "used up", and the expense is recognized in periodic increments, rather than
assuming the asset holds its value until it is actually disposed of. However, since the focus in budgeting
is on the revenues and expendable accounts, depreciation and amortization are not considered budgetary
accounts, and are excluded from the budgeting system. Likewise, debt service and capital expenditures
are presented as the payments occur, departing from GAAP in this regard, in the budget document. Also,
Trust and Agency Funds that may not be expended for governmental operations are excluded from this
budget document.
The presentation of the program budget departs from the basis of the legal budget by eliminating inter city
transactions and allocating the net increases or decreases from internal services to the using programs.
This is done to give the user a more complete picture of the total costs of the operating programs.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
The City of Kent, as all governmental units, operates its budget and accounting system based on a fund
structure. Funds are established to segregate specific revenue to ensure their expenditure within
applicable legal and contractual provisions. Revenues are allocated to and accounted for in individual
funds based on the purposes for which they are to be spent and the means by which the spending
activities are to be controlled. The City of Kent operates with seven basic fund types. Within each fund
type there may exist one or more individual funds. The City of Kent operates with 26 individual funds.
The fund types are listed below under their three major subheadings.
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
GOVERNMENTAL FUNDS
General Fund
The General Fund is the principal operating The General Fund "buys" services from the
fund of the City. It accounts for the financial Internal Service Funds: fuel and rental of
resources of the City which are not accounted vehicles from the Equipment Rental Fund;
for in any other fund. Principal sources of supplies, postage, photocopy, printing and
revenue are property taxes, sales and use graphics, cable TV services, data processing
taxes, utility taxes, licenses and permits, state and telephone services from Central Services;
shared revenues, charges for services and facility maintenance and operation services
interest income. Primary expenditures are for from Facilities; and insurance from the
general City administration, police and fire Insurance Fund. Costs are allocated to all
protection, engineering and planning services, funds in an effort to distribute accounting,
park and street maintenance, and cultural and budgeting, legal and human resource services
recreational services. as well as street, engineering and park
services. General Fund also transfers funds for
minor projects.
Special Revenue Funds
Special Revenue Funds are used to account for Taxes and grants are collected in the Street
specific revenue sources that would otherwise Fund, LEOFF1 Retirees Fund, Lodging Tax
be accounted for in the General Fund, but for Fund, Youth Teen Programs Fund, Capital
which there exists certain legal restrictions as to Improvement Fund, Criminal Justice Fund,
the use of certain revenues. The revenue is Community Development Block Grant Fund,
segregated into individual special revenue funds Other Operating Projects Fund, and the Kent
to ensure expenditure for a designated purpose. Events Center Operating Fund. Transfers from
Principal sources of revenue are: state shared the Street and Capital Improvement Funds are
fuel tax, earmarked sales and utility taxes and primarily to the Capital Project Funds or the
community development block grant funds. The LTGO Debt Service Fund.
major portion of these resources are transferred
to other funds for debt retirement, capital
acquisition and specific purposes operations.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Debt Service Funds
Debt Service Funds are used to account for the The Debt Service Funds receive the transfers
accumulation of resources to be used for the from the Special Revenue Funds, Water Fund
retirement of general long-term debt. The City and Sewerage Funds to pay principal and
has three types of general long-term debt for interest on LTGO debt issues.
which resources are accumulated: general
obligation long-term debt (voted, general
obligation long-term debt and LTGO)and special
assessment debt. Sources of revenue to fund
the retirement of general obligation long-term
debt are property taxes and transfers in from
other funds. Special assessments are levied
and received to retire special assessment debt.
Capital Projects Funds
Capital Projects Funds are used to account for Transfers are received from Special Revenue
the financing of major one time only capital and other funds as a partial source of funds
projects other than those financed by Proprietary needed to complete projects.
Funds. Sources of revenue are: proceeds of
debt issuance, grants, and transfers from other
funds.
PROPRIETARY FUNDS
Enterprise Funds
Enterprise Funds are used to account for the The Enterprise Funds "buy" services from the
financing of services provided to the general Equipment Rental Fund for equipment rental and
public where all or most of the costs involved are fuel; from the Insurance Fund for insurance
paid for by user charges. Operations financed needs; from the Central Service Funds for
as enterprise funds are operated in a manner stores, telephone, postage, photocopying,
similar to private business enterprises. Kent's printing and graphics, cable TV services, data
enterprise funds are funded through water, processing and telecommunications; and from
sewer, and drainage utility charges and the Facilities Fund for facility maintenance and
recreational charges at the City's golf complex. operation services. The Enterprise Funds also
reimburse the General Fund for cost allocations
for budgeting,accounting, human resource, legal
and engineering costs which relate to Enterprise
Funds. Other funds purchase utilities at the
same rate as the general public.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Internal Service Funds
Internal Service Funds are used to account for Centralizes costs for equipment rental, central
the financing of specific services performed by services and insurance. These services are
designated organizations within the City for "sold" to other funds at cost plus a reserve for
other organizations within the City. The City's future needs.
Equipment Rental, Central Service, Facilities
Maintenance and Planning, and Insurance
Funds provide centrally administered services
then generate revenue by billing the
organization to which the service is provided.
FIDUCIARY FUND TYPES
Trust and Agency Funds
Trust and Agency Funds are used to account
for assets held by the City as trustee or agent
for individuals, private organizations or other
governmental units. Since their funds are not
expendable for City operations they are not
included in the budget. However, per state
auditor requirements, estimates are provided
for their activities.
Exhibit A
BUDGET AND SPENDING CONTROL SYSTEM
Budgets serve as control mechanisms in the operations of governmental units. Legal budgetary
(expenditure) control in the City of Kent is maintained at the fund level. Administration can amend
budgets, with no overall dollar increase between departments, within a fund. Supplemental
appropriations that amend total expenditures, or in the case of Proprietary Funds amend working
capital, require a City Council ordinance. All operating budgets lapse at the end of the biennium.
Within each year of the biennium, a single year allocation will be adopted and operate as if it were
an annual budget.
General and Special Revenue Funds control expenditures with a legal biennial budget at the fund
level. Debt Service Funds operate under the control of the bond indentures which established
them. Capital Projects Funds operate under the control of total project authorization, rather than the
annual budget. Proprietary Funds control expenditures with a flexible budget whereby the
expenditure increases must be offset by increased resources. Though budgetary control is at the
fund level, budget and actual information is maintained by project, organization, program and
object. Both budget and actual information is presented on a GAAP basis of accounting, when
presented by fund.
The City must adopt its biennial budget by December of the preceding fiscal year. This usually
follows six months of analysis by staff and City Council. The first step involves the establishment of
the baseline revenue budget by the City Council. The second step is to review the City Council
Strategic Goals and begin budget development to assist in achieving those goals.Third, undertake
a program review to ensure that current program offerings are in agreement with City Council goals
and priorities. The emphasis is placed on the General and Special Revenue Funds since the
operation of other funds are tied to ordinances, contractual agreements or separately established
rate structures. Once the baseline operations have been reviewed and adjusted based on
administrative policy, program expansion is included to the level of projected available resources
after the establishment of sufficient fund balances.
A mid-biennium review is undertaken during the second year of the biennium in which any changes
to the initial estimates of revenues and expenditures are to be reviewed. Such changes will be
presented by the Mayor and discussed by the City Council. Any agreed upon changes shall be
approved with an ordinance adopting changes to the biennial budget.
After the preliminary budget document is prepared, the City Council spends approximately one
month reviewing it. Public meetings are held to gather public input. When the budget review and
final adjustment period is complete a balanced budget as required by state law is adopted by
ordinance. After adoption, periodic budget adjustments that affect total fund expenditures are made
as approved by City Council, but a final budget adjustment ordinance covering all approved
changes is adopted at year end or the beginning of the next biennium.
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FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves—The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund —The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise ..
AsTo the extent ,
this fund _"a" GAIY be 61t I Zed
Lhen
the
first a roved b City Council. In the event any of this funds used inlanfeco omit dovvnt is
pp y y y wnturn
to stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projectsr
This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs—The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of$1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its$1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational coal, the City shall maintain a� Formatted:Font:Bold
total governmental fund balance of twice the greatest volatility in year over year changes in Formatted:Indent:Left: 0.12"
total revenues or$30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds—The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service—To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
BIDS
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REPORTS FROM STAFF, COUNCIL COMMITTEES, AND SPECIAL COMMITTEES
A. Council President
B. Mayor
C. Administration
D. Economic & Community Development
E. Operations
F. Parks & Human Services
G. Public Safety
H. Public Works
I. Regional Fire Authority
J. Other
K. Other
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EXECUTIVE SESSION
ACTION AFTER EXECUTIVE SESSION
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CITY OF KENT
City Council Meeting
Agenda
I�� mt U r rt
r
m
February 4, 2014
Mayor Suzette Cooke
Darla Ralph, Council President
Couneilr embers
Jim Berrios
Bill Boyce
Dennis Higgins
Deborah Ranniger
Les Thomas s
we
CIFY CLERK
y �
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KENT CITY COUNCIL AGENDAS
KENT February 4, 2014
w s v ro Council Chambers
Mayor Suzette Cooke
Council President Dana Ralph
Councilmember Jim Berrios Councilmember Bill Boyce
Councilmember Dennis Higgins Councilmember Deborah Ranniger
Councilmember Les Thomas
*********************************************************************
SPECIAL COUNCIL WORKSHOP AGENDA
5:00 P.M.
Subiect Speaker Time
2014 Top Departmental Issues Tom Brubaker 90 min
COUNCIL MEETING AGENDA
7:00 p.m.
1. CALL TO ORDER/FLAG SALUTE
2. ROLL CALL
3. CHANGES TO AGENDA
A. FROM COUNCIL, ADMINISTRATION, OR STAFF
B. FROM THE PUBLIC — Citizens may request that an item be added
to the agenda at this time. Please stand or raise your hand to
be recognized by the Mayor.
4. PUBLIC COMMUNICATIONS
A. Public Recognition
B. Community Events
C. Introduction of new Arts Commission Appointee, Lynn Bohart
D. Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E. Intergovernmental Reports
5. PUBLIC HEARINGS
6. PUBLIC COMMENT
7. CONSENT CALENDAR
A. Minutes of Previous Meetings and Workshop — Approve
B. Payment of Bills — Approve
C. Appointment to Arts Commission — Confirm
D. Appointments to Land Use and Planning Board - Confirm
(Continued)
COUNCIL MEETING AGENDA CONTINUED
E. Refunding 2004 Limited Tax General Obligation Bond Ordinance —
Adopt
F. Budget Certification for Annexation Sales Tax Credit Resolution —
Adopt
G. Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. — Authorize
H. 2013 Crack Sealing Project Completion — Accept
I. Oakleigh I & II Bill of Sale- Accept
8. OTHER BUSINESS
A. Financial policy Resolution - Adopt
9. BIDS
10. REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
11. EXECUTIVE SESSION AND ACTION AFTER EXECUTIVE SESSION
12. ADJOURNMENT
NOTE: A copy of the full agenda packet is available for perusal in the City Clerk's
Office. The Agenda Summary page and complete packet are on the City of
Kent web site at www.KentWa.gov
An explanation of the agenda format is given on the back of this page.
Any person requiring a disability accommodation should contact the City Clerk's Office
in advance at (253) 856-5725. For TDD relay service call the Washington
Telecommunications Relay Service at 1-800-833-6388.
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CHANGES TO THE AGENDA
Citizens wishing to address the Council will, at this time, make known the
subject of interest, so all may be properly heard.
A) From Council, Administration, or Staff
B) From the Public
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PUBLIC COMMUNICATIONS
A) Public Recognition
B) Community Events
C) Introduction of new Arts Commission Appointee, Lynn Bohart
D) Introduction of new Land Use and Planning Board Appointee,
Katherine Jones and Re-Appointee, Barbara Phillips
E) Intergovernmental Reports
This page intentionally left blank.
PUBLIC HEARING
This page intentionally left blank.
PUBLIC COMMENT
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Agenda Item: Consent Calendar 7A - 7B
CONSENT CALENDAR
7. City Council Action:
Councilmember moves, Councilmember
seconds to approve Consent Calendar Items A through E.
Discussion
Action
7A. Approval of Minutes.
Approval of the minutes of the workshop and regular Council meeting of
December 10, 2013.
7B. Approval of Bills.
Approval of payment of the bills received through November 30 and paid on
November 30 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
11/30/13 Wire Transfers 5684-5694 $1,148,142.13
11/30/13 Regular Checks 678482-678852 $3,165,660.16
Void Checks ($104.90)
11/30/13 Use Tax Payable $1 290.72
$4,314,988.11
Approval of payment of the bills received through December 15 and paid on
December 15 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/15/13 Wire Transfers 5695-5714 $2,044,626.90
12/15/13 Regular Checks 678853-679223 $2,045,487.95
Void Checks ($0.00)
12/15/13 Use Tax Payable $1 414.29
$4,091,529.14
Approval of payment of the bills received through December 31 and paid on
December 31 after auditing by the Operations Committee on January 21, 2014.
Approval of checks issued for vouchers:
Date Check Numbers Amount
12/31/13 Wire Transfers 5715-5727 $1,375,632.00
12/31/13 Regular Checks 679224-679539 $3,099,891.45
Void Checks ($675.00)
12/31/13 Use Tax Payable $162.74
$4,475,011.19
Approval of checks issued for payroll for November 16 through November 30 and
paid on December 5, 2013:
Date Check Numbers Amount
12/5/2013 Checks 333708-333824 $ 91,543.70
Voids and Reissues
12/5/2013 Advices 322206-322830 1,569,071.57
$1,660,615.27
Approval of checks issued for payroll for December 1 through December 15 and
paid on December 20, 2013:
Date Check Numbers Amount
12/20/2013 Checks 333825-333949 $ 77,667.53
Voids and Reissues
12/20/2013 Advices 322831-323460 1,299,170.40
$1,376,837.93
Approval of checks issued for payroll for December 16 through December 31 and
paid on January 3, 2014:
Date Check Numbers Amount
1/3/2014 Checks 333950-334083 $ 66,870.91
Voids and Reissues
1/3/2014 Advices 323461-324081 1,251,884.88
$1,318,755.79
11 � KENT
Kent City Council Workshop
January 21, 2014
The meeting was called to order at 5:30 p.m. by Council President Ralph.
Councilmembers present: Ralph, Berrios, Higgins, Ranniger, and Thomas
Council President Ralph discussed the application process for the Council vacancy. She
highlighted how to apply and verified that the Council would review applications at a
special meeting on February 11, 2014 at 6:00 p.m.
Council Retreat Dates — Council President Ralph communicated that the Council
Retreat would be March 21 and 22 at the Green River Community College.
Councilmember Ranniger suggested an email be sent to Councilmembers.
IS 402 Training - Dominic Marzano, Emergency Management Director discussed IS-
402. He communicated that it is a class for executives and senior officials (policy
makers) and trains them how to better manage events and make policy decisions. He
noted that best practices will also be communicated in the class. He noted that the
class is for South King County officials and urged Council participation in the class. He
also communicated that he will be speaking to MLT next Monday concerning a class
for them because of some new equipment in the emergency communication center
(ECC).
Councilmember Higgins verified that the training is February 12 from 6:00 p.m. to
8:00 p.m.
Marzano also suggested that the Mayor bring the Acting City Attorney to the class to
go over policy decisions.
Council President Ralph communicated that she felt this would be a good opportunity
for the Council. She said there is a lot involved and this is a detailed process. She
noted that at the South County Area Transportation Board meeting there was a
discussion about what cities have set up in case of an oil spill because of the increase
of oil tanker ships in the Puget Sound. Marzano confirmed that the City does have a
plan set up.
B&O Tax Amendments — Robert Nachlinger, Finance Director discussed the
preliminary amendments to the B&O tax ordinance. He communicated that it was
adopted a little over a year ago and the City has received about three quarters of the
projected revenues. He noted that there is an inconsistency between local codes and
that has caused confusion to firms who have to file B&O in numerous cities. He
reviewed Bellevue, Seattle, and Tacoma's exemptions and said staff proposes to
exempt all 501(c) organizations to include homeowner associations, unions, fraternal
organizations, and others who are not engaging in retail activities.
Councilmember Higgins verified that there are a couple of organizations that are
501(c) status that engage in retail sales such as Goodwill and Children's Hospital.
Kent City Council Workshop Minutes January 21, 2014
Councilmember Ranniger inquired about the financial impact and Nachlinger replied
that it would be about $25,000 per year.
Nachlinger continued and discussed filing status and frequency. He noted that having
all firms file quarterly this first year has provided the City with data. Almost 1,600
firms have paid and 36 percent of them (576) have paid over $1,000 quarterly and
this, he noted makes up 92 percent of the total tax revenues collected. He continued
and said 64 percent have paid less than $1,000 and less than 8 percent of the total
revenues collected. He suggested that the firms who have paid less than $1,000 be
reverted to annual collections based on these numbers.
Discussion continued on how they would be reverted to annual collections and
Nachlinger communicated that the Finance Department could send them a letter
communicating this. He also stated that the staff did not recommend having a "non-
filing status" so the City could continue to maintain information concerning
businesses.
Councilmember Higgins verified that only Bellevue and Tacoma have a non-filing
option and Nachlinger communicated their amounts.
Councilmember Higgins discussed the administrative expenditures concerning the
B&O tax.
Councilmember Berrios verified the department was down an auditor. He also
confirmed with Nachlinger that they haven't gotten the data concerning most of the
seasonal firms. However, the data should come in February or March.
Council President Ralph verified with Brubaker that an ordinance would be drafted and
brought to Council for adoption.
Council President Ralph stated she is comfortable with this and agreed with the
process of letting businesses know they have been moved to an annual filing status.
Councilmember Thomas suggested the ordinance be retroactive and if they have paid
this past year they have their funds refunded and not penalized. Fitzpatrick
communicated that his staff will look into doing that.
Councilmember Berrios communicated that the process needs to be fair and
accountable. He said the policy needs to be consistent and take into account who paid
and who didn't based on the legislation the Council passed.
Council President Ralph stated that it seems best to stay the course and make
revisions at the end of the year.
Nachlinger stated that there are 145 3PLs and based on the amount of revenues
generated from their B&O tax compared to their square footage tax returns, the
square footage tax amount was 3.5 times their B&O tax amount. He stated that the
B&O is working exactly as it was intended to. He communicated that there is an
argument concerning companies that don't do many deliveries into Kent, but they are
2
Kent City Council Workshop Minutes January 21, 2014
making more money than what is being reported. He stated that the tax is designed
to get some mitigation from companies that destroy the cities roads.
Councilmember Higgins inquired about the federal research and development funds
and Nachlinger communicated that since the City gave an exemption he wasn't sure
how much it was for.
Councilmember Berrios stated that the Chamber discussed that with Boeing and they
didn't know what the number was either.
Council President Ralph verified that they weren't required to report those federal
funds to the City.
Mayor Cooke clarified that the 3PLs aren't seeking an exemption, but a reduced rate
due to the square footage tax compared to their gross revenues that would be with
the B&O tax. She communicated that if the Council decides that they don't want 3PLs
the businesses can easily go to local cities. She recommended the Council look at the
entire picture and realize that the surface isn't equal.
Councilmember Higgins stated these businesses are creating truck traffic so the B&O
tax makes sense. He also added that the other tax seems appropriate, too.
Councilmember Thomas communicated that he would like to remain competetive and
verified with the Mayor that there are ten 3PL companies. Additionally, the Mayor
added that she wasn't sure how much of the product they are storing is from local
businesses.
Councilmember Ranniger stated that there have been challenges with the streamline
sales tax for a while now. She stated the other policy question is whether to rezone
the area to retail. She said that if the City discourages these types of businesses
because of the B&O tax, the City needs to prepare to decide what it wants to see in
those properties.
Council President Ralph questioned if the conversation should be left open or have
these amendments brought forward.
Councilmember Ranniger stated she would like to see the 501(c) exemption be
brought forward and continued discussion on the 3PLs.
Councilmember Berrios confirmed that there were ten CPLs and added that the City
needs to attract and keep current businesses here. He stated he wasn't sure of the
details with the 3PLs. However, he questioned if the City should allow current
businesses to grow in their current space and investigate exemptions to these
businesses. He suggested investigating if the City is collecting the proper amounts
from these businesses.
Nachlinger verified that they are looking for reductions in their rates, not exemptions.
3
Kent City Council Workshop Minutes January 21, 2014
Mayor Cooke verified with Council President Ralph that this item should go to the
Economic and Community Development Committee.
Council President Ralph communicated that there is consensus to move the 501(c)
revisions to the Operations Committee.
Councilmember Higgins discussed the Sound Transit proposal for gas taxes which
would end up being $3.1 million to the City of Kent for transportation.
Councilmember Thomas communicated that he is against the item.
Council President Ralph communicated that the King County Council is discussing two
different packages and need to decide before March 7 whether or not to go to a ballot
measure. She added that they are also discussing bus fare increases.
Councilmember Higgins communicated that he felt the item is likely to pass county
wide and $3.1 million would be good for closing the gap in transportation
maintenance.
Council President Ralph communicated that Thomas is against, Higgins is in favor,
Ranniger is neutral, and Berrios wants more information. She concluded that she will
communicate to the South County Area Transportation Board that the Kent City
Council is neutral on this item.
Councilmember Thomas communicated that a sixty dollar increase in tabs invites
Eyman to create something worse.
Councilmember Higgins agreed, but noted that Eyman wants these to come to a vote
of the people.
Council President Ralph communicated that it technically isn't sixty dollars, the
current twenty dollar vehicle registration tax would drop off and be sixty dollars, thus
forty dollars more. She also informed the Council to discuss this item with
Councilmember Boyce.
Brubaker noted that this is Nachlinger's last Council workshop and is leaving the City
in very good shape and thanked him for his service to the City of Kent.
Nachlinger stated that he is looking forward to his retirement.
The meeting adjourned at 6:15 p.m.
Ronald F. Moore, MMC
City Clerk
4
KENT
Kent City Council Meeting
January 21, 2014
The regular meeting of the Kent City Council was called to order at 7:01 p.m. by
Mayor Cooke.
Councilmembers present: Higgins, Berrios, Boyce, Ralph, Ranniger, and Thomas.
CHANGES TO THE AGENDA
A. From Council, Administration, Staff - Brubaker communicated that the item in
front of the Councilmembers' dias was the attachment to the Transportation
Improvement Board grant.
B. From the Public - None.
PUBLIC COMMUNICATIONS
A. Oath of office, Councilmember Jim Berrios - City Clerk Ronald F. Moore swore
in Jim Berrios as Councilmember Position No. 2.
B. Public Recognition
1. Kent Parks Foundation Donation - Jeff Watling, Parks and Recreation
Director introduced Mark Prothero, President of the Kent Parks Foundation who
presented the city of Kent with a check for $9,532.57. Prothero also discussed the
"Kent Dancing with the Stars" and communicated that the event raised $13,846.15.
Mayor Cooke thanked Prothero and verified that people who wanted to get in donating
or raising funds for Kent's recreation program could speak to Sandy Pedersen.
2. Award for Men's "E" Western National ASA Softball Tournament to the
City of Kent - Jeff Watling, Parks and Recration Director introduced Mike Raven from
the Amateur Sports Association (ASA). Raven thanked the Kent City staff and
presented the James Ferrell Award to Mayor Cooke and the city of Kent.
Mayor Cooke thanked Raven and the city of Kent Parks staff.
C. Community Events - Mayor Cooke announced that the "You-Me-We" event is this
Friday at the ShoWare Center, January 24 at 6:00 p.m. She encouraged the public to
attend the free event.
Mayor Cooke also noted that her "State of the City Address" wil be at the ShoWare
Center during the Chamber of Commerce Luncheon on February 5 at 12 noon. She
also added that it will be online and on the City's cable station.
D. Introduction of new Arts Commission Appointee, Jennifer Treese - Mayor
Cooke communicated that she interviewed her for the position.
Kent City Council Meeting Minutes January 21, 2014
Treese communicated that she found the vacancy online and said she has been doing
cultural things for over a decade now. She added that her employer is Blue Origin, a
rocket company in Kent.
E. Public Safety Report - Police Chief Ken Thomas discussed Mike Buckingham and
his memorial service last Thursday. He discussed Buckingham's service to the City and
people. He noted that he lost his battle with cancer on January 2, 2014.
Council President Ralph discussed Buckingham and her son's experience with him. She
stated that she was fortunate enough to meet him and work with him the last couple
of years. She said he has had a tremendous impact on the City and will truly be
missed.
Thomas discussed the year end report. He noted that commercial burglary is
unchanged and there has been a 21 percent reduction in residential burglaries from
2012 to present. He noted that robbery is down 13 percent. He noted that vehicle theft
is only up 2 percent compared to the rampant vehicle theft rate in King County.
Thomas presented Christin Jordan with the Police Chiefs Award of Accomodation. He
communicated that Jordan was instrumental in a stolen car recovery and preventing a
residential burglary.
Thomas presented Shanelle Mozique with the Police Chief's Award of Accomodation. He
explained that Mozique, while in the middle of a home invasion, called the police
department during the robbery. He noted that the police successfully caught two of the
three suspects.
Thomas presented Officer Whisteric and Officer Nixon with the Police Department
Lifesaving Medal for saving the life of Lewis Drake. Drake submitted a letter to the
Police Chief, which he read.
Thomas communicated that the City is in the top ten of all cities with a population of
250,000 or less for their efforts with National Night Out, which is run by Sarah Wood.
Sarah Wood communicated that the event will be on August 10, 2014 this year.
Thomas introduced four new officers, Siitupe Coffin, Kamal Sharif, Andrew Richardson,
and Brittany Rios. He discussed each of their backgrounds, work experience, and
education.
Mayor Cooke swore in the four officers.
Thomas introduced newly hired Corrections Officer Ian Lentz and Records Specialists
Julie Farris, Ashley Orlowski, Christy Roeber, and Crystal Sundquist. He highlighted
their work history and gave a brief backgound of their education and personal lives.
Thomas presented a Chief's Award of Accomodation to Councilmember Berrios for
performing CPR on a patient who suffered a medical emergency.
Mayor Cooke presented Chief Ken Thomas with his city of Kent 25 year service plaque.
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Kent City Council Meeting Minutes January 21, 2014
F. Intergovernmental Reports - Council President Ralph communicated that the
South County Area Transportation Board met concerning express toll lanes being
added on Interstate 405 between Lynnwood and Bellevue and the addition of express
toll lanes on Interstate 167. She said the Lynnwood connection is going on now is
expected to open in 2016 and the 167 should be done a couple of years after that. She
noted that the 405 project will feature a new definition of what a carpool is and they
are suggesting three person carpools.
Councilmember Higgins stated that he is serving on the Sound Cities Association Board
of Directors and their board retreat is January 31. He said he is also serving on the
King County Regional Transit Committee and has heard the proposal concerning
funding transit. He stated that the King County Executive can't wait on legislature so
they are going forward to create a Transportation Benefit District countywide which
would mean the twenty dollar car tab going up to sixty dollars and a 0.1% sales tax.
Sixty percent of the revenues would go to King County for Metro, saving 600,000
service hours, including five routes in Kent and the remaining 40 percent would go to
cities.
Councilmember Boyce noted that he represents the City on the board and received
consensus from the Council to present a neutral vote on this item for the Kent City
Council until the entire package is reviewed. He noted that the next meeting is
February 12.
Councilmember Thomas thanked Councilmember Berrios for his efforts in helping save
a man's life on January 1st. He noted that it was discussed at the Regional Fire
Authority meeting.
PUBLIC HEARINGS
None.
PUBLIC COMMENT
Mayor Cooke discussed the council seat vacancy and communicated that
Council President Ralph will discuss the item under Other Business.
1. Pauline Barrett, Kent - Barrett discussed the possible development of a marijuana
processing facility by her home. She communicated that the facility would be in the
center of a large residential area with high school children in the neighborhood. She
expressed concerns with security if this business is allowed to open.
2. Bill Doolittle, Kent - Doolittle communicated that when I-502 was adopted people
wanted it legalized and taxed. He stated that Kent is going out of their way to prevent
marijuana authorization and said he read that the City would be zoned to prevent it.
He urged the City to work with the liquor board to get this implemented. He said
marijuana is currently being sold, consumed, and created in the City of Kent.
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Kent City Council Meeting Minutes January 21, 2014
3. Thomas L. Brice, Kent - Brice discussed the Par 3 golf course and the vision of the
City. He said a committee has been formed by five residents and they have submitted
suggestions and ideas of what could be done concerning the course. He noted that
there is a debt and if you look at the books, the golf course isn't the problem. He
suggested the course be closed in the winter.
4. Martin Plys, Kent - Plys communicated that there is a $1.9 million surplus. He said
if there is a surplus it should be applied to the ShoWare Center and the golf course
should be sold.
Mayor Cooke verified that there isn't a surplus.
Plys opposed having any marijuana facilities in Kent.
CONSENT CALENDAR
Council President Ralph moved to approve Consent Calendar Items A through
P, seconded by Councilmember Thomas.
A. Minutes of the workshop and regular Council meeting of January P 2014 -
Approved
B. Appointment to Arts Commission —The Council confirmed the appointment of
Jennifer Treese to the Kent Arts Commission for a four year term ending October 31,
2017.
C. King County Solid Waste Division Waste Reduction & Recycling Grant -
Approved. - The Mayor was authorized to accept the Waste Reduction and Recycling
Grant Contract in the amount of $89,835 for 2014, and amend the budget and
authorize the expenditure of funds in accordance with the terms and conditions of the
grant, subject to final terms and conditions acceptable to the City Attorney and Public
Works Director.
D. Seattle-King County Health Department Local Hazardous Waste
Management Program/Recycling Event Grant- Approved. The Mayor was
authorized to accept the Local Hazardous Waste Management Program Contract in the
amount of $32,278.87 for 2014, and amend the budget and authorize the expenditure
of funds in accordance with the terms and conditions of the grant, subject to final
terms and conditions acceptable to the City Attorney and Public Works Director.
E. Contract with Olympic Environmental for 2014 -15 Residential Recycling
Collection Events- Approved. The Mayor was authorized to sign the Consultant
Services Agreement with Olympic Environmental Resources for Waste Reduction and
Recycling Activities and Programs for 2014 - 2015 in the amount of $185,551.00,
subject to final terms and conditions acceptable to the City Attorney and the Public
Works Director.
F. SR 516 to S 2315t Way Levee North Reach Improvements, Change order
No. 1- Approved. The Mayor was authorized to approve Change Order No. 1 to SCI
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Kent City Council Meeting Minutes January 21, 2014
Infrastructure, LLC in an amount not to exceed $194,059.46 for unanticipated
construction costs on the SR 516 to South 231st Way Levee, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
G. Central Avenue South Improvements Federal Grant- Accept. The Mayor was
authorized to accept a Federal Grant in the amount of $300,000 for the design phase
of the Central Avenue South Pavement Preservation Project, and amend the budget
and authorize expenditure of the funds in accordance with the terms and conditions of
the grant, subject to final terms and conditions acceptable to the City Attorney and
Public Works Director.
H. Kent Interurban Trail Connector Proiect Grant — Accept. The Mayor was
authorized to sign the grant agreement in the amount of $727,500 with the
Washington State Department of Commerce for the Kent Interurban Trail Connector
Project and amend the budget and authorize expenditure of the funds in accordance
with the terms and conditions of the grant, subject to final terms and conditions
acceptable to the City Attorney and Public Works Director.
I. South 224th Street Improvements, Phase 2 Transportation Improvement
Board (TIB) Grant- Accept. The Mayor was authorized to accept a grant from the
Washington State Transportation Improvement Board for Phase 2 of the South 224th
Street Improvement Project and sign a letter to the TIB requesting to combine Phases
1 and 2 into one project, amend the budget and authorize expenditure of the funds in
accordance with the terms and conditions of the grant, subject to final terms and
conditions acceptable to the City Attorney and Public Works Director.
J. Washington Auto Theft Prevention Authority (WATPA) Patrol Task Force
2013 — 2015 Grant- Accept. The Mayor was authorized to accept the Washington
Auto Theft Prevention Authority grant award in the amount of $74,983, authorize
amending the budget and authorize expenditure of the funds in accordance with the
terms and conditions of the grant, acceptable to the City Attorney and Police Chief.
K. Ordinance Amending Kent City Code Chapter 9.02, Lewd Conduct — Adopt.
The Council adopted Ordinance No. amending Chapter 9.02 by establishing crimes
relating to lewd conduct, by amending sections relating to prostitution loitering and by
adding new areas which fall within the scope of the stay out of areas of prostitution
orders.
L. 2012 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2012 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc., upon receipt of standard releases from
the state and the release of any liens.
M. 2013 Thermo Plastic Markings Proiect Completion - Accept. They Mayor
was authorized to accept the 2013 Thermo Plastic Markings Project as complete and
release retainage to Stripe Rite Inc., upon receipt of standard releases from the state
and the release of any liens.
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Kent City Council Meeting Minutes January 21, 2014
N. 2013 Vehicle Detector Loops Proiect Completion — Accept. The Mayor was
authorized to accept the 2013 Vehicle Detector Loops Project as complete and release
retainage to Totem Electric of Tacoma, Inc. upon receipt of standard releases from the
state and the release of any liens.
0. Hawley Road Levee Improvements Phase I Proiect Completion — Accept.
The Mayor was authorized to accept the Hawley Road Levee Improvements Phase I
Project as complete and release retainage to SCI Infrastructure LLC, upon receipt of
standard releases from the state and the release of any liens.
P. Horseshoe Bend and Upper Russell Road Levee Planting Proiect
Completion — Accept. The Mayor was authorized to accept the Horseshoe Bend and
Upper Russell Road Levee Plantings Project as complete and release retainage to
Restoration Logistics, upon receipt of standard releases from the state and the release
of any liens.
OTHER BUSINESS
A. Council Position No. 6 - Appointment Process - Mayor Cooke introduced the
item. Council President Ralph communicated the process and noted that the process
will be posted on the City's website and a handout was given to those in attendance by
City Clerk Moore.
Councilmember Boyce inquired what would happen with current applications and
Councilpresident Ralph communicated that she would communicate with anyone who
has previously submitted an application and inform them of the current process.
Councilmember Thomas inquired about the position and the process. Acting City
Attorney Fitzpatrick noted that the appointment lasts until the November 2015 election
is certified and whoever is elected at the general election will serve the rest of the
term.
1. Anna Davis, Kent - Davis discussed the process and inquired if the candidate that
also ran for the position in November could be considered and not have to reapply.
Mayor Cooke replied that the candidate needs to submit an application and go through
this process. She further explained the election process and said it is set up by state
law and it is up to the Council to interview and selects a candidate. She further
explained that it wasn't an option to have the runner-up in the November election
considered.
Council President Ralph also replied that this is the appointment process and that once
the November election is certified it is over. She also communicated that this
information will be on the website, channel 21, in the Kent Reporter, and announced at
Neighborhood Council meetings, etc.
BIDS
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Kent City Council Meeting Minutes January 21, 2014
A. Briscoe-Desimone Levee Improvements, Reaches 2 and 3 - Tim LaPorte,
Public Works Director introduced the levee improvements. He displayed the levee, why
the improvements are needed, and what the improvements would entail. He
communicated that there were ten excellent bids and has checked out the
qualifications of the lowest bidder, Tapani, Inc. LaPorte explained to Mayor Cooke why
this item wasn't heard at a committee, noting that a bid award doesn't go to
committee, but straight to the Council.
Councilmember Higgins moved to authorize the Mayor to award the bid for
the Briscoe-Desimone Levee Improvements Reaches 2 and 3 project to
Tapani, Inc., in the amount of $6,709,555.56 and authorize the Mayor to sign
all necessary documents, subject to the final terms and conditions acceptable
to the City Attorney and Public Works Director, seconded by Council President
Ralph. Motion carried 6-0.
LaPorte communicated that King County Flood District wants a groundbreaking
ceremony for this levee improvement this spring.
Mayor Cooke agreed and communicated that the City should also look at what park
element should be added to the south.
REPORTS FROM STANDING COMMITTEES, STAFF AND SPECIAL COMMITTEES
A. Council President. Ralph stated that the B&O tax was discussed in the workshop
meeting and that the Council decided to hold off on any amendments to it at this time.
She stated that there will be a 501(c) item exemption going forth as a draft to the
Operations Committee and an item concerning 3PLs going to the Economic and
Community Development Committee at a later date.
B. Mayor. No report.
C. Administration. No report. No executive session tonight.
D. Economic & Community Development Committee. Councilmember Boyce
communicated that the next meeting is February 10.
E. Operations Committee. No report.
F. Parks and Human Services Committee. No report.
G. Public Safety Committee. No report.
H. Public Works Committee. Councilmember Higgins communicated that the
meeting yesterday was postponed and the next meetig is January 27.
I. Regional Fire Authority. Councilmember Thomas communicated that he stepped
down as chair and Mike Denfro is the chair and Higgins is the deputy chair.
EXECUTIVE SESSION ACTION AFTER EXECUTIVE SESSION
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Kent City Council Meeting Minutes January 21, 2014
No executive session was held.
ADJOURNMENT
The meeting adjourned at 8:38 p.m.
Ronald F. Moore, MMC
City Clerk
8
40.
KF14 Agenda Item: Consent — 7C
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointment to Kent Arts Commission — Confirm
MOTION: Confirm the Mayor's appointment of Lynn Bohart to the Kent
Arts Commission.
SUMMARY: Confirm the appointment of Lynn Bohart to the Kent Arts Commission for
a four year term ending October 31, 2017.
Lynn Bohart submitted an application for appointment to the Kent Arts Commission
to fill a vacant four year term. Lynn is Executive Director of the Renton Community
Foundation and remains an avid supporter of the arts. Lynn's belief is that a vibrant
arts community speaks to the soul of a city.
Lynn holds a Master's Degree in theater and has worked in Community Theater over
the years. She is a published mystery writer on Amazon.com, teaches writing through
the Kent Parks Department and Green River Community College's Continuing
Education program. She has served on the Lane County Arts Council Board while
living in Oregon and has served on the Vancouver Arts Commission before moving to
Kent.
Lynn's commitment to the Kent community and her active role in the arts makes her
an exceptional candidate for the Kent Arts Commission, and I am pleased to
recommend Lynn Bohart for your confirmation.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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KENT
° Agenda Item: Consent — 7D
TO: City Council
DATE: February 4, 2014
SUBJECT: Appointments to Land Use and Planning Board — Confirm
MOTION: Confirm the Mayor's appointment of Katherine Jones and re-
appointment of Barbara Phillips to the Land Use & Planning Board.
SUMMARY: Confirm the appointment of Katherine Jones and re-appointment of
Barbara Phillips to the Land Use & Planning Board each for a three year term ending
December 31, 2016.
Katherine Jones made application for appointment to the Land Use & Planning Board
for a three-year term. Kathi, a Realtor with John L. Scott, lives in The Lakes
community, and feels her service on the LUPB will assist in promoting a healthier and
improved environment for all Kent citizens. Kathi's work as a realtor gives her an
understanding of the Smart Growth principles involving citizens, public officials and
stakeholders working together to plan ahead for development. Kathy has attended
many LUPB meetings and city council meetings in an effort to stay abreast of issues
confronting our community. She was an interested participant in the Midway Project,
the Cottage Housing Project, and is head of The Lakes Neighborhood Council
Kathi's commitment to the Kent community makes her an ideal candidate for the Land
Use & Planning Board, and I am pleased to recommend Kathi Jones for your
confirmation.
Barbara Phillips was first appointed to the Land Use & Planning Board in November,
2007, expressing her desire to be an integral part of the City's development and
future prosperity. Her reappointment will begin her third term which will expire on
December 31, 2016. Barbara has lived in Kent for over 20 years and currently is
President of the Community Network Council which works to connect youth with
resources that will help them become successful.
I am pleased to recommend re-appointment of Barbara Phillips to the LUPB.
RECOMMENDED BY: Mayor Suzette Cooke
BUDGET IMPACTS: None
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•
Nl- KENT Agenda Item: Consent- 7E
TO: City Council
DATE: February 4, 2014
SUBJECT: Refunding 2004 Limited Tax General Obligation Bond Ordinance - Adopt
MOTION: Move to adopt Ordinance No. , approving the refunding of
the 2004 Limited Tax General Obligation bonds.
SUMMARY: The 2004 LTGO bonds are callable at par on June 1, 2014 and may be
called 90 days in advance of the call date. This transaction would save an estimated
$700,000 over the eight year life of the bonds by issuing refunding bonds at a lower
interest rate. The existing bonds would be retired as of June 1 and defeased.
EXHIBITS: Ordinance
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: This transaction would reduce the debt service cost paid by the
Capital Improvements Fund by approximately $87,500 annually over the next eight
years.
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ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE OF LIMITED
TAX GENERAL OBLIGATION REFUNDING BONDS OF THE CITY
IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED
$14,000,000 TO REFUND CERTAIN OUTSTANDING LIMITED
TAX GENERAL OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM AND TERMS OF
THE BONDS; AND DELEGATING THE AUTHORITY TO
APPROVE THE FINAL TERMS OF THE BONDS.
PASSED: FEBRUARY 4, 2014
PREPARED BY:
PACIFICA LAW GROUP LLP
Seattle, Washington
CITY OF KENT
ORDINANCE NO.
TABLE OF CONTENTS*
Page
SECTION 1. - Definitions and Interpretation of Terms 2
SECTION 2. - Authorization of Bonds and Bond Details 8
SECTION 3. - Registration, Exchange and Payments 9
SECTION 4. - Redemption Prior to Maturity and Purchase
of Bonds 15
SECTION 5. - Form of Bonds 20
SECTION 6. - Execution of Bonds 22
SECTION 7. - Refunding Plan; Application of Bond
Proceeds 23
SECTION 8. - Tax Covenants 26
SECTION 9. - Bond Fund and Provision for Tax Levy
Payments 29
SECTION 10. - Defeasance 30
SECTION 11. - Sale of Bonds 31
SECTION 12. - Undertaking to Provide Ongoing Disclosure 33
SECTION 13. - Lost, Stolen or Destroyed Bonds 38
SECTION 14. - Severability; Ratification 38
SECTION 15. - Effective Date of Ordinance 40
* This Table of Contents is provided for convenience only and is not a part
of this ordinance.
-1- 01/14/14
CITY OF KENT, WASHINGTON
ORDINANCE NO.
AN ORDINANCE OF THE CITY OF KENT,
WASHINGTON, PROVIDING FOR THE ISSUANCE
OF LIMITED TAX GENERAL OBLIGATION
REFUNDING BONDS OF THE CITY IN THE
AGGREGATE PRINCIPAL AMOUNT OF NOT TO
EXCEED $14,000,000 TO REFUND CERTAIN
OUTSTANDING LIMITED TAX GENERAL
OBLIGATION BONDS AND TO PAY COSTS OF
ISSUING THE BONDS; PROVIDING THE FORM
AND TERMS OF THE BONDS; AND DELEGATING
THE AUTHORITY TO APPROVE THE FINAL
TERMS OF THE BONDS.
A. The City of Kent, Washington (the "City") has outstanding its
Limited Tax General Obligation Refunding Bonds, 2004, issued pursuant to
Ordinance No. 3682 adopted by the City Council (the "Council") of the City
on March 16, 2004 (the "2004 Bond Ordinance"), which remain
outstanding as follows:
Maturity Date
(December 1) Principal Amount Interest Rate
2014 $ 1,875,000 5.000%
2015 1,750,000 5.250
2016 1,625,000 5.250
2017 1,445,000 5.250
2018 1,265,000 5.250
2019 1,280,000 4.000
2020 2,030,000 4.000
2021 1,325,000 4.125
(the "2004 Bonds"); and
B. The 2004 Bond Ordinance provides that the City may call the
2004 Bonds maturing on or after December 1, 2014 (the "Refunding
Candidates") for redemption on or after June 1, 2014, in whole or in part
at any time, at a price of par plus accrued interest, if any, to the date of
redemption; and
C. After due consideration it appears to the Council that all or a
portion of the Refunding Candidates may be defeased and refunded by the
proceeds of limited tax general obligation refunding bonds at a savings to
the City and its taxpayers; and
D. The Council deems it in the best interest of the City to issue
limited tax general obligation refunding bonds in the aggregate principal
amount of not to exceed $14,000,000 (the "Bonds") to redeem and
defease all or a portion of the Refunding Candidates and to pay costs of
issuing the Bonds; and
E. The Council wishes to delegate authority to the Mayor (the
"Designated Representative"), for a limited time, to approve the interest
rates, maturity dates, redemption terms and principal maturities for the
Bonds within the parameters set by this ordinance; and
F. The City expects to receive a proposal from KeyBanc Capital
Markets Inc. (the "Underwriter") and now desires to issue and sell the
Bonds to the Underwriter as set forth herein;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON DO ORDAIN as follows:
SECTION 1. - Definitions and Interpretation of Terms.
(a) Definitions. As used in this ordinance, the following words
shall have the following meanings:
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Limited Tax General Obligation Refunding Bonds, 2014
Acquired Obligations means the Government Obligations acquired
by the City under the terms of this ordinance and the Escrow Deposit
Agreement to effect the defeasance and refunding of the Refunded Bonds.
Beneficial Owner means any person that has or shares the power,
directly or indirectly, to make investment decisions concerning ownership
of any Bonds (including persons holding Bonds through nominees,
depositories or other intermediaries).
Bond Fund means the "City of Kent Limited Tax General Obligation
Bond Debt Service Fund, 2014" authorized to be created pursuant to
Section 9.
Bond Purchase Contract means the contract for the purchase of the
Bonds between the Underwriter and the City, executed pursuant to
Section 11.
Bond Register means the registration books showing the name,
address and tax identification number of each Registered Owner of the
Bonds, maintained pursuant to Section 149(a) of the Code.
Bond Registrar means, initially, the fiscal agency of the State of
Washington, for the purposes of registering and authenticating the Bonds,
maintaining the Bond Register, effecting transfer of ownership of the
Bonds and paying interest on and principal of the Bonds.
Bond Year means each one-year period that ends on the date
selected by the City. The first and last Bond Years may be short periods.
If no date is selected by the City before the earlier of the final maturity
date of Bonds or the date that is five years after the date of issuance of
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Limited Tax General Obligation Refunding Bonds, 2014
any Bonds, Bond Years end on each anniversary of the date of issue and
on the final maturity date of such Bonds.
Bonds mean the not to exceed $14,000,000 aggregate principal
amount of City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014, authorized to be issued pursuant to this
ordinance.
Call Date means June 1, 2014.
Chief Administrative Officer means the Chief Administrative Officer
or Interim Chief Administrative Officer of the City or the successor to such
officer.
City means the City of Kent, Washington, a municipal corporation
duly organized and existing under and by virtue of the Constitution and
laws of the State of Washington.
Code means the Internal Revenue Code of 1986, as amended, and
shall include all applicable regulations and rulings relating thereto.
Commission means the Securities and Exchange Commission.
Council or City Council means the legislative body of the City as
duly and regularly constituted from time to time.
Designated Representative means the Mayor, or his or her
designee.
DTC means The Depository Trust Company, New York, New York, a
limited purpose trust company organized under the laws of the State of
New York, as depository for the Bonds pursuant to Section 3.
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Limited Tax General Obligation Refunding Bonds, 2014
Escrow Agent means U.S. Bank National Association, Seattle,
Washington.
Escrow Deposit Agreement means the Escrow Deposit Agreement
between the City and the Escrow Agent to be dated as of the date of
closing of the Bonds and substantially in the form on file with the City.
Federal Tax Certificate means the certificate executed by the
Finance Director setting forth the requirements of the Code for
maintaining the tax exemption of interest on the Bonds, and attachments
thereto.
Finance Director means the Finance Director of the City or the
successor to such officer.
Financial Advisor means Piper ]affray & Co., or its successors.
Government Obligations mean those obligations now or hereafter
defined as such in chapter 39.53 RCW.
Letter of Representations means the blanket issuer letter of
representations from the City to DTC.
MSRB means the Municipal Securities Rulemaking Board or any
successors to its functions.
Net Proceeds, when used with reference to the Bonds, means the
principal amount of such Bonds, plus accrued interest and original issue
premium, if any, and less original issue discount, if any.
Private Person means any natural person engaged in a trade or
business or any trust, estate, partnership, association, company or
corporation.
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Limited Tax General Obligation Refunding Bonds, 2014
Private Person Use means the use of property in a trade or business
by a Private Person if such use is other than as a member of the general
public. Private Person Use includes ownership of the property by the
Private Person as well as other arrangements that transfer to the Private
Person the actual or beneficial use of the property (such as a lease,
management or incentive payment contract or other special arrangement)
in such a manner as to set the Private Person apart from the general
public. Use of property as a member of the general public includes
attendance by the Private Person at municipal meetings or business rental
of property to the Private Person on a short-term basis in accordance with
regulations under the Code if the rental paid by such Private Person is the
same as the rental paid by any Private Person who desires to rent the
property. Use of property by nonprofit community groups or community
recreational groups is not treated as Private Person Use if such use is
incidental to the governmental uses of property, the property is made
available for such use by all such community groups on an equal basis and
such community groups are charged only a de minimis fee to cover
custodial expenses.
Refunded Bonds mean all or a portion of the Refunding Candidates
designated by the Designated Representative for refunding pursuant to
Section 7 and Section 11.
Refunding Account means the account by that name established
pursuant to Section 7.
-6-
Limited Tax General Obligation Refunding Bonds, 2014
Refunding Candidates mean the 2004 Bonds maturing on or after
December 1, 2014.
Registered Owner means the person named as the registered owner
of a Bond in the Bond Register. For so long as the Bonds are held in book-
entry only form, DTC or its nominee shall be deemed to be the sole
Registered Owner.
Rule means the Commission's Rule 15c2-12 under the Securities
Exchange Act of 1934, as the same may be amended from time to time.
2004 Bond Ordinance means Ordinance No. 3682 adopted by the
Council on March 16, 2004 authorizing the issuance of the 2004 Bonds.
2004 Bonds mean the City of Kent, Washington, Limited Tax
General Obligation Refunding Bonds, 2004 issued pursuant to the 2004
Bond Ordinance as described in the recitals of this ordinance.
Underwriter means KeyBanc Capital Markets Inc., or its successors.
(b) Interpretation. In this ordinance, unless the context
otherwise requires:
(1) The terms "hereby," "hereof," "hereto," "herein,"
"hereunder" and any similar terms, as used in this ordinance, refer to this
ordinance as a whole and not to any particular article, section, subdivision
or clause hereof, and the term "hereafter" shall mean after, and the term
"heretofore" shall mean before, the date of this ordinance;
(2) Words of the masculine gender shall mean and include
correlative words of the feminine and neuter genders and words importing
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Limited Tax General Obligation Refunding Bonds, 2014
the singular number shall mean and include the plural number and vice
versa;
(3) Words importing persons shall include firms,
associations, partnerships (including limited partnerships), trusts,
corporations and other legal entities, including public bodies, as well as
natural persons;
(4) Any headings preceding the text of the several articles
and sections of this ordinance, and any table of contents or marginal notes
appended to copies hereof, shall be solely for convenience of reference
and shall not constitute a part of this ordinance, nor shall they affect its
meaning, construction or effect; and
(5) All references herein to "articles," "sections" and other
subdivisions or clauses are to the corresponding articles, sections,
subdivisions or clauses hereof.
SECTION 2,- Authorization of Bonds and Bond Details. For the
purpose of refunding the Refunded Bonds and paying costs of issuance of
the Bonds, the City shall issue and sell limited tax general obligation
refunding bonds in the aggregate principal amount of not to exceed
$14,000,000 (the "Bonds").
The Bonds shall be general obligations of the City, shall be
designated "City of Kent, Washington, Limited Tax General Obligation
Refunding Bonds, 2014" with other such designation as set forth in the
Bond Purchase Contract and approved by the Designated Representative.
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The Bonds shall be dated as of their date of initial delivery, shall be
fully registered as to both principal and interest, shall be in the
denomination of $5,000 each or any integral multiple thereof within a
maturity, shall be numbered separately in the manner and with any
additional designation as the Bond Registrar deems necessary for
purposes of identification and control, and shall bear interest payable on
the dates set forth in the Bond Purchase Contract. The Bonds shall bear
interest at the rates set forth in the Bond Purchase Contract; and shall
mature on the dates and in the principal amounts set forth in the Bond
Purchase Contract and as approved by a Designated Representative
pursuant to Section 11.
SECTION 3. - Registration, Exchange and Payments.
(a) Bond Registrar/Bond Register. The City hereby specifies and
adopts the system of registration approved by the Washington State
Finance Committee from time to time through the appointment the state
fiscal agency. The City shall cause a Bond Register to be maintained by
the Bond Registrar. So long as any Bonds remain outstanding, the Bond
Registrar shall make all necessary provisions to permit the exchange or
registration or transfer of Bonds at its principal corporate trust office. The
Bond Registrar may be removed at any time at the option of the Finance
Director upon prior notice to the Bond Registrar and a successor Bond
Registrar appointed by the Finance Director. No resignation or removal of
the Bond Registrar shall be effective until a successor shall have been
appointed and until the successor Bond Registrar shall have accepted the
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duties of the Bond Registrar hereunder. The Bond Registrar is authorized,
on behalf of the City, to authenticate and deliver Bonds transferred or
exchanged in accordance with the provisions of such Bonds and this
ordinance and to carry out all of the Bond Registrar's powers and duties
under this ordinance. The Bond Registrar shall be responsible for its
representations contained in the Certificate of Authentication of the Bonds.
(b) Registered Ownership. The City and the Bond Registrar, each
in its discretion, may deem and treat the Registered Owner of each Bond
as the absolute owner thereof for all purposes (except as provided in
Section 12 of this ordinance), and neither the City nor the Bond Registrar
shall be affected by any notice to the contrary. Payment of any such Bond
shall be made only as described in Section 3(h), but such Bond may be
transferred as herein provided. All such payments made as described in
Section 3(h) shall be valid and shall satisfy and discharge the liability of
the City upon such Bond to the extent of the amount or amounts so paid.
(c) DTC Acceptance/Letters of Representations. The Bonds
initially shall be held in fully immobilized form by DTC acting as
depository. To induce DTC to accept the Bonds as eligible for deposit at
DTC, the City has executed and delivered to DTC a Blanket Issuer Letter of
Representations. Neither the City nor the Bond Registrar will have any
responsibility or obligation to DTC participants or the persons for whom
they act as nominees (or any successor depository) with respect to the
Bonds in respect of the accuracy of any records maintained by DTC (or
any successor depository) or any DTC participant, the payment by DTC (or
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any successor depository) or any DTC participant of any amount in respect
of the principal of or interest on Bonds, any notice which is permitted or
required to be given to Registered Owners under this ordinance (except
such notices as shall be required to be given by the City to the Bond
Registrar or to DTC (or any successor depository)), or any consent given
or other action taken by DTC (or any successor depository) as the
Registered Owner. For so long as any Bonds are held in fully immobilized
form by a depository, DTC or its successor depository shall be deemed to
be the Registered Owner for all purposes hereunder, and all references
herein to the Registered Owners shall mean DTC (or any successor
depository) or its nominee and shall not mean the owners of any beneficial
interest in such Bonds.
(d) Use of Depository.
(1) The Bonds shall be registered initially in the name of
"Cede & Co.", as nominee of DTC, with one Bond maturing on each of the
maturity dates for the Bonds in a denomination corresponding to the total
principal therein designated to mature on such date. Registered
ownership of such Bonds, or any portions thereof, may not thereafter be
transferred except (A) to any successor of DTC or its nominee, provided
that any such successor shall be qualified under any applicable laws to
provide the service proposed to be provided by it; (B) to any substitute
depository appointed by the Finance Director pursuant to subsection (2)
below or such substitute depository's successor; or (C) to any person as
provided in subsection (4) below.
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(2) Upon the resignation of DTC or its successor (or any
substitute depository or its successor) from its functions as depository or a
determination by the Finance Director to discontinue the system of book
entry transfers through DTC or its successor (or any substitute depository
or its successor), the Finance Director may hereafter appoint a substitute
depository. Any such substitute depository shall be qualified under any
applicable laws to provide the services proposed to be provided by it.
(3) In the case of any transfer pursuant to clause (A) or
(B) of subsection (1) above, the Bond Registrar shall, upon receipt of all
outstanding Bonds, together with a written request on behalf of the
Finance Director, issue a single new Bond for each maturity then
outstanding, registered in the name of such successor or such substitute
depository, or their nominees, as the case may be, all as specified in such
written request of the Finance Director.
(4) In the event that (A) DTC or its successor (or
substitute depository or its successor) resigns from its functions as
depository, and no substitute depository can be obtained, or (B) the
Finance Director determines that it is in the best interest of the beneficial
owners of the Bonds that such owners be able to obtain physical Bond
certificates, the ownership of such Bonds may then be transferred to any
person or entity as herein provided, and such Bonds shall no longer be
held by a depository. The Finance Director shall deliver a written request
to the Bond Registrar, together with a supply of physical Bonds, to issue
Bonds as herein provided in any authorized denomination. Upon receipt
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by the Bond Registrar of all then outstanding Bonds together with a
written request on behalf of the Finance Director to the Bond Registrar,
new Bonds shall be issued in the appropriate denominations and
registered in the names of such persons as are requested in such written
request.
(e) Registration of Transfer of Ownership or Exchange; Change in
Denominations. The transfer of any Bond may be registered and Bonds
may be exchanged, but no transfer of any such Bond shall be valid unless
it is surrendered to the Bond Registrar with the assignment form
appearing on such Bond duly executed by the Registered Owner or such
Registered Owner's duly authorized agent in a manner satisfactory to the
Bond Registrar. Upon such surrender, the Bond Registrar shall cancel the
surrendered Bond and shall authenticate and deliver, without charge to
the Registered Owner or transferee therefor, a new Bond (or Bonds at the
option of the new Registered Owner) of the same date, maturity and
interest rate and for the same aggregate principal amount in any
authorized denomination, naming as Registered Owner the person or
persons listed as the assignee on the assignment form appearing on the
surrendered Bond, in exchange for such surrendered and cancelled Bond.
Any Bond may be surrendered to the Bond Registrar and exchanged,
without charge, for an equal aggregate principal amount of Bonds of the
same date, maturity and interest rate, in any authorized denomination.
The Bond Registrar shall not be obligated to register the transfer or to
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exchange any Bond during the 15 days preceding any principal payment
date any such Bond is to be redeemed.
(f) Bond Registrar's Ownership of Bonds. The Bond Registrar
may become the Registered Owner of any Bond with the same rights it
would have if it were not the Bond Registrar, and to the extent permitted
by law, may act as depository for and permit any of its officers or directors
to act as a member of, or in any other capacity with respect to, any
committee formed to protect the right of the Registered Owners of Bonds.
(g) Registration Covenant. The City covenants that, until all
Bonds have been surrendered and canceled, it will maintain a system for
recording the ownership of each Bond that complies with the provisions of
Section 149 of the Code.
(h) Place and Medium of Payment. 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 calculated on the basis of a year
of 360 days and twelve 30-day months. For so long as all Bonds are held
by a depository, payments of principal and interest thereon shall be made
as provided in accordance with the operational arrangements of DTC
referred to in the Letter of Representations. In the event that the Bonds
are no longer held by a depository, interest on the Bonds shall be paid by
check or draft mailed to the Registered Owners at the addresses for such
Registered Owners appearing on the Bond Register on the fifteenth day of
the month preceding the interest payment date, or upon the written
request of a Registered Owner of more than $1,000,000 of Bonds
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(received by the Bond Registrar at least 15 days prior to the applicable
payment date), such payment shall be made by the Bond Registrar by
wire transfer to the account within the United States designated by the
Registered Owner. Principal of the Bonds shall be payable upon
presentation and surrender of such Bonds by the Registered Owners at the
principal office of the Bond Registrar.
If any Bond shall be duly presented for payment and funds have not
been duly provided by the City on such applicable date, then interest shall
continue to accrue thereafter on the unpaid principal thereof at the rate
stated on such Bond until it is paid.
SECTION 4, - Redemption Prior to Maturity and Purchase of Bonds.
(a) Mandatory Redemption of Term Bonds and Optional
Redemption, if any. The Bonds shall be subject to optional redemption on
the dates, at the prices and under the terms set forth in the Bond
Purchase Contract approved by the Designated Representative pursuant to
Section 11. The Bonds shall be subject to mandatory redemption to the
extent, if any, set forth in the Bond Purchase Contract approved by the
Designated Representative pursuant to Section 11.
(b) Purchase of Bonds. The City reserves the right to purchase
any of the Bonds offered to it at any time at a price deemed reasonable by
the Finance Director.
(c) Selection of Bonds for Redemption. For as long as the Bonds
are held in book-entry only form, the selection of particular Bonds within a
maturity to be redeemed shall be made in accordance with the operational
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arrangements then in effect at DTC. If the Bonds are no longer held in
uncertificated form, the selection of such Bonds to be redeemed and the
surrender and reissuance thereof, as applicable, shall be made as provided
in the following provisions of this subsection (c). If the City redeems at
any one time fewer than all of the Bonds having the same maturity date,
the particular Bonds or portions of Bonds of such maturity to be redeemed
shall be selected by lot (or in such manner determined by the Bond
Registrar) in increments of $5,000. In the case of a Bond of a
denomination greater than $5,000, the City and the Bond Registrar shall
treat each Bond as representing such number of separate Bonds each of
the denomination of $5,000 as is obtained by dividing the actual principal
amount of Bonds by $5,000. In the event that only a portion of the
principal sum of a Bond is redeemed, upon surrender of such Bond at the
principal office of the Bond Registrar there shall be issued to the
Registered Owner, without charge therefor, for the then unredeemed
balance of the principal sum thereof, at the option of the Registered
Owner, a Bond or Bonds of like maturity and interest rate in any of the
denominations herein authorized.
(d) Notice of Redemption.
(1) Official Notice. For so long as the Bonds are held in
uncertificated form, notice of redemption (which notice may be
conditional) shall be given in accordance with the operational
arrangements of DTC as then in effect, and neither the City nor the Bond
Registrar will provide any notice of redemption to any Beneficial Owners.
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Thereafter (if the Bonds are no longer held in uncertificated form), notice
of redemption shall be given in the manner hereinafter provided. Unless
waived by any owner of Bonds to be redeemed, official notice of any such
redemption (which redemption may be conditioned by the Bond Registrar
on the receipt of sufficient funds for redemption or otherwise) shall be
given by the Bond Registrar on behalf of the City by mailing a copy of an
official redemption notice by first class mail at least 20 days and not more
than 60 days prior to the date fixed for redemption to the Registered
Owner of the Bond or Bonds to be redeemed at the address shown on the
Bond Register or at such other address as is furnished in writing by such
Registered Owner to the Bond Registrar.
All official notices of redemption shall be dated and shall state:
(A) the redemption date,
(B) the redemption price,
(C) if fewer than all outstanding Bonds are to be
redeemed, the identification by maturity (and, in the case of partial
redemption, the respective principal amounts) of the Bonds to be
redeemed,
(D) that (unless such notice is conditional) on the
redemption date the redemption price will become due and payable upon
each such Bond or portion thereof called for redemption, and that interest
thereon shall cease to accrue from and after said date, and
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(E) the place where such Bonds are to be
surrendered for payment of the redemption price, which place of payment
shall be the principal office of the Bond Registrar.
On or prior to any redemption date (unless such notice is
conditional), the City shall deposit with the Bond Registrar an amount of
money sufficient to pay the redemption price of all the Bonds or portions
of Bonds which are to be redeemed on that date.
(2) Effect of Notice; Bonds Due. If an unconditional notice
of redemption has been given as aforesaid, or if the conditions to
redemption have been satisfied or waived, the Bonds or portions of Bonds
so to be redeemed shall, on the redemption date, become due and
payable at the redemption price therein specified, and from and after such
date such Bonds or portions of Bonds shall cease to bear interest. Upon
surrender of such Bonds for redemption in accordance with said notice,
such Bonds shall be paid by the Bond Registrar at the redemption price.
Installments of interest due on or prior to the redemption date shall be
payable as herein provided for payment of interest. All Bonds which have
been redeemed shall be canceled by the Bond Registrar and shall not be
reissued.
If a conditional notice of redemption has been given and the
conditions to redemption have not been satisfied or waived, notice of
redemption given pursuant to this ordinance may be rescinded by written
notice given by the Bond Registrar on behalf of the City as soon as
practicable in the same manner, and to the same Registered Owners of
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the Bond or Bonds, as notice of such redemption was given pursuant to
this Section 4(d). If notice of recession has been provided, the Bonds or
portions of Bonds so to be redeemed, on the redemption date, shall not
become due and payable and from and after such date such Bonds or
portions of Bonds shall continue to bear interest at the rate or rates set
forth therein until paid or until due provision is made for the payment of
the same.
(3) Additional Notice. In addition to the foregoing notice,
further notice shall be given by the City as set out below, but no defect in
said further notice nor any failure to give all or any portion of such further
notice shall in any manner defeat the effectiveness of a call for redemption
if notice thereof is given as above prescribed. Each further notice of
redemption given hereunder shall contain the information required above
for an official notice of redemption plus (A) the CUSIP numbers of all
Bonds being redeemed; (B) the date of issue of the Bonds as originally
issued; (C) the rate of interest borne by each Bond being redeemed;
(D) the maturity date of each Bond being redeemed; and (E) any other
descriptive information needed to identify accurately the Bonds being
redeemed. Each further notice of redemption may be sent at least
20 days before the redemption date to each party entitled to receive
notice pursuant to Section 12 and with such additional information as the
City shall deem appropriate, but such mailings shall not be a condition
precedent to the redemption of such Bonds.
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Limited Tax General Obligation Refunding Bonds, 2014
(4) Amendment of Notice Provisions. The foregoing notice
provisions of this Section 4, including but not limited to the information to
be included in redemption notices and the persons designated to receive
notices, may be amended by additions, deletions and changes in order to
maintain compliance with duly promulgated regulations and
recommendations regarding notices of redemption of municipal securities.
SECTIONS. - Form of Bonds. The Bonds shall be in substantially
the following form with appropriate or necessary insertions, depending
upon the omissions and variations as permitted or required hereby:
UNITED STATES OF AMERICA
NO. $
STATE OF WASHINGTON
CITY OF KENT
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2014
INTEREST RATE: % MATURITY DATE: CUSIP NO.:
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The City of Kent, Washington (the "City"), hereby acknowledges
itself to owe and for value received promises to pay to the Registered
Owner identified above, or registered assigns, on the Maturity Date
identified above, the Principal Amount indicated above and to pay interest
thereon from , 2014, or the most recent date to which
interest has been paid or duly provided for until payment of this bond at
the Interest Rate set forth above, payable on and
semiannually thereafter on the first days of each succeeding and
Both principal of and interest on this bond are payable in lawful
money of the United States of America. The fiscal agency of the State of
Washington has been appointed by the City as the authenticating agent,
paying agent and registrar for the bonds of this issue (the "Bond
Registrar"). For so long as the bonds of this issue are held in fully
immobilized form, payments of principal and interest thereon shall be
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made as provided in accordance with the operational arrangements of The
Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter
of Representations (the "Letter of Representations") from the City to DTC.
The bonds of this issue are issued under and in accordance with the
provisions of the Constitution and applicable statutes of the State of
Washington and Ordinance No. duly passed by the City Council
on February 4, 2014 (the "Bond Ordinance"). Capitalized terms used in
this bond have the meanings given such terms in the Bond Ordinance.
This bond shall not be valid or become obligatory for any purpose or
be entitled to any security or benefit under the Bond Ordinance until the
Certificate of Authentication hereon shall have been manually signed by or
on behalf of the Bond Registrar or its duly designated agent.
This bond is one of an authorized issue of bonds of like series, date,
tenor, rate of interest and date of maturity, except as to number and
amount in the aggregate principal amount of $ and is issued
pursuant to the Bond Ordinance to provide a portion of the funds
necessary (a) to defease and refund certain limited tax general obligation
bonds of the City, and (b) to pay costs of issuance.
[The bonds of this issue are subject to redemption as provided in
the Bond Ordinance and the Bond Purchase Contract.]
The City hereby irrevocably covenants and agrees with the owner of
this bond that it will include in its annual budget and levy taxes annually,
within and as a part of the tax levy permitted to the City without a vote of
the electorate, upon all the property subject to taxation in amounts
sufficient, together with other money legally available therefor, to pay the
principal of and interest on this bond as the same shall become due. The
full faith, credit and resources of the City are hereby irrevocably pledged
for the annual levy and collection of such taxes and the prompt payment
of such principal and interest.
[The bonds of this issue have [not] been designated by the City as
"qualified tax-exempt obligations" for investment by financial institutions
under Section 265(b) of the Code.]
The pledge of tax levies for payment of principal of and interest on
the bonds may be discharged prior to maturity of the bonds by making
provision for the payment thereof on the terms and conditions set forth in
the Bond Ordinance.
It is hereby certified that all acts, conditions and things required by
the Constitution and statutes of the State of Washington to exist and to
have happened, been done and performed precedent to and in the
issuance of this bond exist and have happened, been done and performed
and that the issuance of this bond and the bonds of this issue does not
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violate any constitutional, statutory or other limitation upon the amount of
bonded indebtedness that the City may incur.
IN WITNESS WHEREOF, the City of Kent, Washington has caused
this bond to be executed by the manual or facsimile signatures of the
Mayor and the City Clerk and the seal of the City imprinted, impressed or
otherwise reproduced hereon as of this _ day of 2014.
[SEAL]
CITY OF KENT,
WASHINGTON
By /s/ manual or facsimile
Mayor
ATTEST:
/s/ manual or facsimile
City Clerk
The Bond Registrar's Certificate of Authentication on the Bonds shall
be in substantially the following form:
CERTIFICATE OF AUTHENTICATION
This bond is one of the bonds described in the within-mentioned
Bond Ordinance and is one of the Limited Tax General Obligation
Refunding Bonds, 2014 of the City of Kent, Washington, dated
2014.
WASHINGTON STATE FISCAL
AGENCY, as Bond Registrar
By
SECTION 6. - Execution of Bonds. The Bonds shall be executed on
behalf of the City with the manual or facsimile signature of the Mayor and
attested by the manual or facsimile signature of the City Clerk and the
seal of the City shall be impressed, imprinted or otherwise reproduced
thereon.
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Only such Bonds as shall bear thereon a Certificate of
Authentication in the form hereinbefore recited, manually executed by the
Bond Registrar, shall be valid or obligatory for any purpose or entitled to
the benefits of this ordinance. Such Certificate of Authentication shall be
conclusive evidence that the Bonds so authenticated have been duly
executed, authenticated and delivered hereunder and are entitled to the
benefits of this ordinance.
In case either of the officers who shall have executed the Bonds
shall cease to be an officer or officers of the City before the Bonds so
signed shall have been authenticated or delivered by the Bond Registrar,
or issued by the City, such Bonds may nevertheless be authenticated,
delivered and issued and upon such authentication, delivery and issuance,
shall be as binding upon the City as though those who signed the same
had continued to be such officers of the City. Any Bond may be signed
and attested on behalf of the City by such persons who at the date of the
actual execution of such Bond, are the proper officers of the City, although
at the original date of such Bond any such person shall not have been
such officer of the City.
SECTION 7. - Refunding Plan; Application of Bond Proceeds.
(a) Refunding Plan. For the purpose of realizing a debt service
savings, the City proposes to defease and refund the Refunded Bonds as
set forth herein. The Refunded Bonds shall include all or a portion of the
Refunding Candidates as designated by the Designated Representative
and set forth in the Bond Purchase Contract. Proceeds of the Bonds shall
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be deposited with the Escrow Agent pursuant to the Escrow Deposit
Agreement to be used immediately upon receipt thereof to defease the
Refunded Bonds as authorized by the 2004 Bond Ordinance and to pay
costs of issuance of the Bonds.
The net proceeds deposited with the Escrow Agent shall be used to
defease the Refunded Bonds and discharge the obligations thereon by the
purchase of certain Government Obligations (which obligations so
purchased, are herein called "Acquired Obligations"), bearing such interest
and maturing as to principal and interest in such amounts and at such
times which, together with any necessary beginning cash balance, will
provide for the payment of:
(1) interest on the Refunded Bonds as such becomes due
on and prior to the Call Date; and
(2) the redemption price (100% of the principal amount)
of the Refunded Bonds on the Call Date.
Such Acquired Obligations shall be purchased at a yield not greater
than the yield permitted by the Code and regulations relating to acquired
obligations in connection with refunding bond issues.
(b) Escrow Agent/Escrow Deposit Agreement. The City hereby
appoints U.S. Bank National Association, Seattle, Washington, as the
Escrow Agent for the Refunded Bonds (the "Escrow Agent'). A beginning
cash balance, if any, and the Acquired Obligations shall be deposited
irrevocably with the Escrow Agent in an amount sufficient to defease the
Refunded Bonds. The proceeds of the Bonds remaining after acquisition of
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the Acquired Obligations and provision for the necessary beginning cash
balance shall be utilized to pay expenses of the acquisition and
safekeeping of the Acquired Obligations and costs of issuance of the
Bonds.
In order to carry out the purposes of this Section 7, the Finance
Director is authorized and directed to execute and deliver to the Escrow
Agent, an Escrow Deposit Agreement.
(c) Call for Redemption of Refunded Bonds. The City hereby sets
aside sufficient funds out of the purchase of Acquired Obligations from
proceeds of the Bonds to make the payments described above.
The City hereby calls the Refunded Bonds for redemption on their
Call Date in accordance with the provisions of the 2004 Bond Ordinance
authorizing the redemption and retirement of the 2004 Bonds, prior to
their fixed maturities.
Said defeasance and call for redemption of the Refunded Bonds
shall be irrevocable after the issuance of the Bonds and delivery of the
Acquired Obligations to the Escrow Agent.
The Escrow Agent is hereby authorized and directed to provide for
the giving of notices of the redemption of the Refunded Bonds in
accordance with the applicable provisions of the 2004 Bond Ordinance.
The costs of publication of such notices shall be an expense of the City.
The Escrow Agent is hereby authorized and directed to pay to the
Finance Director, or, at the direction of the Finance Director, to the paying
agent for the Refunded Bonds, sums sufficient to pay, when due, the
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payments specified in this Section 7. All such sums shall be paid from the
moneys and Acquired Obligations deposited with the Escrow Agent, and
the income therefrom and proceeds thereof. All such sums so paid to or
to the order of the Finance Director shall be credited to the Refunding
Account. All moneys and Acquired Obligations deposited with the Escrow
Agent and any income therefrom shall be held, invested (but only at the
direction of the Finance Director) and applied in accordance with the
provisions of this ordinance and with the laws of the State of Washington
for the benefit of the City and owners of the Refunded Bonds.
The City will take such actions as are found necessary to see that all
necessary and proper fees, compensation and expenses of the Escrow
Agent for the Refunded Bonds shall be paid when due.
SECTION B. - Tax Covenants.
The City covenants that it will not take or permit to be taken on its
behalf any action that would adversely affect the exemption from federal
income taxation of the interest on the Bonds 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 Bonds.
(a) Arbitrage Covenant. 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 proceeds of sale of the Bonds or any other
funds of the City which may be deemed to be proceeds of the Bonds
pursuant to Section 148 of the Code and the regulations promulgated
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thereunder which, if such use had been reasonably expected on the dates
of delivery of the Bonds to the initial purchasers thereof, would have
caused the Bonds to be treated as "arbitrage bonds" within the meaning of
such term as used in Section 148 of the Code. The City will comply with
the requirements of Section 148 of the Code and the applicable
regulations thereunder throughout the term of the Bonds.
(b) Private Person Use Limitation for the Bonds. The City
covenants that for as long as the Bonds are outstanding, it will not permit:
(1) More than 10% of the Net Proceeds of the Bonds to be
allocated to any Private Person Use; and
(2) More than 10% of the principal or interest payments
on the Bonds in a Bond Year to be directly or indirectly: (A) secured by
any interest in property used or to be used for any Private Person Use or
secured by payments in respect of property used or to be used for any
Private Person Use, or (B) derived from payments (whether or not made
to the City) in respect of property, or borrowed money, used or to be used
for any Private Person Use.
The City further covenants that, if:
(3) More than five percent of the Net Proceeds of the
Bonds are allocable to any Private Person Use; and
(4) More than five percent of the principal or interest
payments on the Bonds in a Bond Year are (under the terms of this
ordinance or any underlying arrangement) directly or indirectly:
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Limited Tax General Obligation Refunding Bonds, 2014
(A) secured by any interest in property used or to be
used for any Private Person Use or secured by payments in respect
of property used or to be used for any Private Person Use, or
(B) derived from payments (whether or not made to
the City) in respect of property, or borrowed money, used or to be
used for any Private Person Use, then, (i) any Private Person Use of
the projects described in subsection (3) hereof or Private Person
Use payments described in subsection (4) hereof that is in excess of
the five percent limitations described in such subsections (3) or (4)
will be for a Private Person Use that is related to the state or local
governmental use of the projects refunded by the proceeds of the
Bonds, and (ii) any Private Person Use will not exceed the amount
of Net Proceeds of the Bonds allocable to the state or local
governmental use portion of the projects(s) to which the Private
Person Use of such portion of the projects refunded by the proceeds
of the Bonds relate. The City further covenants that it will comply
with any limitations on the use of the projects refunded by the
proceeds of the Bonds by other than state and local governmental
users that are necessary, in the opinion of its bond counsel, to
preserve the tax exemption of the interest on the Bonds.
(c) Modification of Tax Covenants. The covenants of this section
are specified solely to assure the continued exemption from regular
income taxation of the interest on the Bonds. To that end, the provisions
of this section may be modified or eliminated without any requirement for
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Limited Tax General Obligation Refunding Bonds, 2014
formal amendment thereof upon receipt of an opinion of the City's bond
counsel that such modification or elimination will not adversely affect the
tax exemption of interest on any Bonds.
(d) In the Federal Tax Certificate the City may designate the
Bonds as "qualified tax-exempt obligations" under Section 265(b)(3) of
the Code for investment by financial institutions if at the time of such
designation it reasonably does not expect to issue more than $10,000,000
in qualifying tax-exempt debt during calendar year 2014.
SECTION 9. - Bond Fund and Provision for Tax Levy Payments.
The City hereby authorizes the creation of a fund to be used for the
payment of debt service on the Bonds, designated as the "City of Kent
Limited Tax General Obligation Bond Debt Service Fund, 2014" (the "Bond
Fund"). No later than the date each payment of principal of or interest on
the Bonds becomes due, the City shall transmit sufficient funds, from the
Bond Fund or from other legally available sources, to the Bond Registrar
for the payment of such principal or interest. Money in the Bond Fund
may be invested in legal investments for City funds.
The City hereby irrevocably covenants and agrees for as long as any
of the Bonds are outstanding and unpaid that each year it will include in
its budget and levy an ad valorem tax upon all the property within the City
subject to taxation in an amount that will be sufficient, together with all
other revenues and money of the City legally available for such purposes,
to pay the principal of and interest on the Bonds when due.
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Limited Tax General Obligation Refunding Bonds, 2014
The City hereby irrevocably pledges that the annual tax provided for
herein to be levied for the payment of such principal and interest shall be
within and as a part of the tax levy permitted to cities without a vote of
the people, and that a sufficient portion of each annual levy to be levied
and collected by the City prior to the full payment of the principal of and
interest on the Bonds will be and is hereby irrevocably set aside, pledged
and appropriated for the payment of the principal of and interest on the
Bonds. The full faith, credit and resources of the City are hereby
irrevocably pledged for the annual levy and collection of said taxes and for
the prompt payment of the principal of and interest on the Bonds when
due.
SECTION 10. - Defeasance. In the event that the City, to effect
the payment, retirement or redemption of any Bond, sets aside in the
Bond Fund or in another special account, cash or noncallable Government
Obligations, or any combination of cash and/or noncallable Government
Obligations, in amounts and maturities which, together with the known
earned income therefrom, are sufficient to redeem or pay and retire such
Bond in accordance with its terms and to pay when due the interest and
redemption premium, if any, thereon, and such cash and/or noncallable
Government Obligations are irrevocably set aside and pledged for such
purpose, then no further payments need be made into the Bond Fund for
the payment of the principal of and interest on such Bond. The owner of a
Bond so provided for shall cease to be entitled to any lien, benefit or
security of this ordinance except the right to receive payment of principal,
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Limited Tax General Obligation Refunding Bonds, 2014
premium, if any, and interest from the Bond Fund or such special account,
and such Bond shall be deemed to be not outstanding under this
ordinance.
The City shall give written notice of defeasance to the owners of all
Bonds so provided for within 30 days of the defeasance and to each party
entitled to receive notice in accordance with Section 12.
SECTION 11. - Sale of Bonds.
(a) Bond Sale. The Bonds shall be sold at negotiated sale to the
Underwriter pursuant to the terms of the Bond Purchase Contract. The
Financial Advisor has advised the Council that market conditions are
fluctuating and, as a result, the most favorable market conditions may
occur on a day other than a regular meeting date of the Council. The
Council has determined that it would be in the best interest of the City to
delegate to the Designated Representative for a limited time the authority
to approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, selection of the Refunded Bonds,
and redemption rights.
The Designated Representative is hereby authorized to designate a
portion or all of the Refunding Candidates as Refunded Bonds, and to
approve the final interest rates, aggregate principal amount, principal
amounts of each maturity of the Bonds, and redemption rights for the
Bonds in the manner provided hereafter so long as (i) the aggregate
principal amount of the Bonds does not exceed $14,000,000, (ii) the final
maturity date for the Bonds is no later than December 1, 2021, (iii) the
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Limited Tax General Obligation Refunding Bonds, 2014
Bonds are sold (in the aggregate) at a price not less than 97% and not
greater than 120%, (iv) the Bonds are sold for a price that results in a
minimum net present value debt service savings over the Refunded Bonds
of at least 3.0%, (v) the true interest cost for the Bonds (in the
aggregate) does not exceed 3.5%; and (vi) the Bonds conform to all other
terms of this ordinance. Subject to the terms and conditions set forth in
this section, the Designated Representative is hereby authorized to
execute the Bond Purchase Contract.
Following the execution of the Bond Purchase Contract, the Finance
Director shall provide a report to the Council describing the final terms of
the Bonds approved pursuant to the authority delegated in this section.
The authority granted to the Designated Representative by this Section 11
shall expire 120 days after the effective date of this ordinance. If a Bond
Purchase Contract for the Bonds has not been executed within 120 days
after the effective date of this ordinance, the authorization for the
issuance of the Bonds shall be rescinded, and the Bonds shall not be
issued nor their sale approved unless such Bonds shall have been re-
authorized by ordinance of the Council. The ordinance re-authorizing the
issuance and sale of such Bonds may be in the form of a new ordinance
repealing this ordinance in whole or in part or may be in the form of an
amendatory ordinance approving a bond purchase contract or establishing
terms and conditions for the authority delegated under this Section 11.
(b) Delivery of Bonds; Documentation. Upon the passage and
approval of this ordinance, the proper officials of the City, including the
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Limited Tax General Obligation Refunding Bonds, 2014
Finance Director and Chief Administrative Officer, are authorized and
directed to undertake all action necessary for the prompt execution and
delivery of the Bonds to the Underwriter and further to execute all closing
certificates and documents required to effect the closing and delivery of
the Bonds in accordance with the terms of this ordinance and the Bond
Purchase Contract.
(c) Preliminary and Final Official Statements. The Finance
Director is hereby authorized to ratify and to deem final the preliminary
Official Statement relating to the Bonds for the purposes of the Rule. The
Finance Director is further authorized to ratify and to approve for purposes
of the Rule, on behalf of the City, the final Official Statement relating to
the issuance and sale of the Bonds and the distribution of the final Official
Statement pursuant thereto with such changes, if any, as may be deemed
by her to be appropriate.
SECTION 12. - Undertaking to Provide Ongoing Disclosure.
(a) Contract/Undertaking. This section constitutes the City's
written undertaking for the benefit of the owners, including Beneficial
Owners, of the Bonds as required by Section (b)(5) of the Rule.
(b) Financial Statements/Operating Data. The City agrees to
provide or cause to be provided to the MSRB the following annual financial
information and operating data for the prior fiscal year (commencing in
2014 for the fiscal year ended December 31, 2013):
1. Annual financial statements, which statements may or
may not be audited, showing ending fund balances for the City's general
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Limited Tax General Obligation Refunding Bonds, 2014
fund prepared in accordance with the Budgeting Accounting and Reporting
System prescribed by the Washington State Auditor pursuant to
RCW 43.09.200 (or any successor statute) and generally of the type
specified in the official statement for the Bonds;
2. The assessed valuation of taxable property in the City;
3. Ad valorem taxes due and percentage of taxes
collected;
4. Property tax levy rate per $1,000 of assessed
valuation; and
5. Outstanding general obligation debt of the City.
Items 2-5 shall be required only to the extent that such information is not
included in the annual financial statements.
The information and data described above shall be provided on or
before nine months after the end of the City's fiscal year. The City's
current fiscal year ends December 31. The City may adjust such fiscal
year by providing written notice of the change of fiscal year to the MSRB.
In lieu of providing such annual financial information and operating data,
the City may cross-reference to other documents available to the public on
the MSRB's internet website or filed with the Commission.
If not provided as part of the annual financial information discussed
above, the City shall provide to the MSRB the City's audited annual
financial statements prepared in accordance with the Budgeting
Accounting and Reporting System prescribed by the Washington State
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Limited Tax General Obligation Refunding Bonds, 2014
Auditor pursuant to RCW 43.09.200 (or any successor statute) when and if
available.
(c) Listed Events. The City agrees to provide or cause to be
provided to the MSRB, in a timely manner not in excess of ten business
days after the occurrence of the event, notice of the occurrence of any of
the following events with respect to the Bonds:
• Principal and interest payment delinquencies;
• Non-payment related defaults, if material;
• Unscheduled draws on debt service reserves reflecting
financial difficulties;
• Unscheduled draws on credit enhancements reflecting
financial difficulties;
• Substitution of credit or liquidity providers, or their failure to
perform;
• Adverse tax opinions, the issuance by the Internal Revenue
Service of proposed or final determinations of taxability,
Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax
status of the Bonds, or other material events affecting the tax
status of the Bonds;
• Modifications to the rights of Bondholders, if material;
• Bond calls, if material, and tender offers;
• Defeasances;
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Limited Tax General Obligation Refunding Bonds, 2014
• Release, substitution, or sale of property securing repayment
of the Bonds, if material;
• Rating changes;
• Bankruptcy, insolvency, receivership or similar event of the
City;
• The consummation of a merger, consolidation, or acquisition
involving the City or the sale of all or substantially all of the
assets of the City, other than in the ordinary course of
business, the entry into a definitive agreement to undertake
such an action or the termination of a definitive agreement
relating to any such actions, other than pursuant to its terms,
if material; and
• Appointment of a successor or additional trustee or the
change of name of a trustee, if material.
The City shall promptly determine whether the events described above are
material.
(d) Format for Filings with the MSRB. All notices, financial
information and operating data required by this undertaking to be
provided to the MSRB must be in an electronic format as prescribed by the
MSRB. All documents provided to the MSRB pursuant to this undertaking
must be accompanied by identifying information as prescribed by the
MSRB.
(e) Notification Upon Failure to Provide Financial Data. The City
agrees to provide or cause to be provided, in a timely manner, to the
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Limited Tax General Obligation Refunding Bonds, 2014
MSRB notice of its failure to provide the annual financial information
described in Subsection (b) above on or prior to the date set forth in
Subsection (b) above.
(f) Termination/Modification. The City's obligations to provide
annual financial information and notices of certain listed events shall
terminate upon the legal defeasance, prior redemption or payment in full
of all of the Bonds. Any provision of this section shall be null and void if
the City (1) obtains an opinion of nationally recognized bond counsel to
the effect that the portion of the Rule that requires that provision is
invalid, has been repealed retroactively or otherwise does not apply to the
Bonds and (2) notifies the MSRB of such opinion and the cancellation of
this section.
The City may amend this section with an opinion of nationally
recognized bond counsel in accordance with the Rule. In the event of any
amendment of this section, the City shall describe such amendment in the
next annual report, and shall include a narrative explanation of the reason
for the amendment and its impact on the type (or in the case of a change
of accounting principles, on the presentation) of financial information or
operating data being presented by the City. In addition, if the amendment
relates to the accounting principles to be followed in preparing financial
statements, (A) notice of such change shall be given in the same manner
as for a listed event under Subsection (c), and (B) the annual report for
the year in which the change is made shall present a comparison (in
narrative form and also, if feasible, in quantitative form) between the
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Limited Tax General Obligation Refunding Bonds, 2014
financial statements as prepared on the basis of the new accounting
principles and those prepared on the basis of the former accounting
principles.
(g) Bond Owner's Remedies Under This Section. The right of any
bondowner or Beneficial Owner of Bonds to enforce the provisions of this
section shall be limited to a right to obtain specific enforcement of the
City's obligations under this section, and any failure by the City to comply
with the provisions of this undertaking shall not be an event of default
with respect to the Bonds.
(h) No Default. Except as otherwise disclosed in the City's official
statement relating to the Bonds, the City is not and has not been in
default in the performance of its obligations of any prior undertaking for
ongoing disclosure with respect to its obligations.
SECTION 13. - Lost, Stolen or Destroyed Bonds. In case any
Bond or Bonds shall be lost, stolen or destroyed, the Bond Registrar may
execute and deliver a new Bond or Bonds of like date, number and tenor
to the Registered Owner thereof upon the Registered Owner's paying the
expenses and charges of the City and the Bond Registrar in connection
therewith and upon his/her filing with the City evidence satisfactory to the
City that such Bond was actually lost, stolen or destroyed and of his/her
ownership thereof, and upon furnishing the City and/or the Bond Registrar
with indemnity satisfactory to the City and the Bond Registrar.
SECTION 14. - Severability; Ratification. If any one or more of
the covenants or agreements provided in this ordinance to be performed
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Limited Tax General Obligation Refunding Bonds, 2014
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 deemed
separable from the remaining covenants and agreements of this ordinance
and shall in no way affect the validity of the other provisions of this
ordinance or of the Bonds. All acts taken pursuant to the authority
granted in this ordinance but prior to its effective date are hereby ratified
and confirmed.
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Limited Tax General Obligation Refunding Bonds, 2014
SECTION 15. - Effective Date of Ordinance. This ordinance shall
take effect and be in force five days after its passage, approval, and
publication as provided by law.
Adopted by the City Council of the City of Kent, Washington, at a
regular meeting thereof held this 4th of February, 2014.
By
Suzette Cooke, Mayor
ATTEST
Ronald F. Moore, MMC, City
Clerk
APPROVED AS TO FORM:
PACIFICA LAW GROUP LLP
Bond Counsel
PASSED: of February, 2014
APPROVED: of February, 2014
PUBLISHED: of February, 2014
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Limited Tax General Obligation Refunding Bonds, 2014
CERTIFICATION
I, the undersigned, City Clerk of the City of Kent, Washington (the
"City"), hereby certify as follows:
1. The attached copy of Ordinance No. (the
"Ordinance") is a full, true and correct copy of an ordinance duly passed at
a regular meeting of the City Council of the City held at the regular time
and meeting place thereof on February 4, 2014, as that ordinance appears
on the minute book of the City; and the Ordinance will be in full force and
effect after its passage; and
2. A quorum of the members of the City Council was present
throughout the meeting and a majority of those members present voted in
the proper manner for the passage of the Ordinance.
IN WITNESS WHEREOF, I have hereunto set my hand this 4th day
of February, 2014.
CITY OF KENT, WASHINGTON
Ronald F. Moore, MMC, City Clerk
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KENT
Agenda Item: Consent — 7F
TO: City Council
DATE: February 4, 2014
SUBJECT: Budget Certification for Annexation Sales Tax Credit Resolution — Adopt
MOTION: Move to adopt Resolution No. , approving the certification
of $4,230,777 for the Panther Lake annexation sales tax credit for the
period July 1, 2014 through June 30, 2015.
SUMMARY: The City is required to certify to the state of Washington before March Vt
of each year, the amount needed from the annexation sales tax credit to provide
services in the annexed area. The Finance Department has calculated the costs and
revenues within the Panther Lake annexation area and has determined a gap between
revenues generated and expenditures used to provide services of $4,230,777 for July
1, 2014 through June 30, 2015.
EXHIBITS: Resolution
RECOMMENDED BY: Operations Committee
YEA: Thomas - Ralph - Boyce (post meeting) NAY:
BUDGET IMPACTS: The budget for the Panther Lake annexation area for the State's
fiscal year 2013 is anticipated to be $11,949,899 in expenditures to provide City
services to those residents, while we anticipate revenues of $7,719,122 from property
taxes, sales taxes and other sources. The net of the revenues and costs produces a
deficit of $4,230,777 which is the amount being certified as the amount of annexation
sales tax credit we are requesting from the State.
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RESOLUTION NO.
A RESOLUTION of the City Council of the
City of Kent, Washington, determining a new
threshold amount for the sales and use tax
authorized by RCW 82.14.415 and codified in
Chapter 3.27 of the Kent City Code, relating to the
cost of providing municipal services to the Panther
Lake Annexation Area for the 2014 fiscal year, and
authorizing the Finance Director to certify the
threshold amount to the Washington State
Department of Revenue.
RECITALS
A. RCW 82.14.415 authorizes the City to impose a sales and use
tax as a credit against state retail sales and use taxes collected under
Chapters 82.08 and 82.12 RCW to assist the City in providing municipal
services to newly annexed areas.
B. After providing all appropriate notice and following appropriate
procedure, and following a favorable vote on the annexation proposition,
the Kent City Council adopted Ordinance No. 3936 on December 8, 2009,
approving the Panther Lake Annexation Area effective July 1, 2010. The
population within the annexation area determined at the time of
annexation was 25,458 people.
1 Tax Credit Threshold
Panther Lake Annexation
C. On February 16, 2010, the City Council passed Ordinance No.
3947, creating Chapter 3.27 of the Kent City Code and imposing the sales
and use tax at the rate of 0.2 percent.
D. On February 15, 2011, the City Council adopted Resolution
No. 1839 confirming the tax rate at 0.2 percent and authorizing the finance
director to certify the threshold amount for the 2011 fiscal year.
E. On February 7, 2012, through Resolution No. 1853, the City
Council adopted a new threshold amount for the 2012 fiscal year and
authorized the finance director to certify the same.
F. On February 19, 2013, through Resolution No. 1871, the City
Council adopted a new threshold amount for the 2013 fiscal year and
authorized the finance director to certify the same.
G. With this Resolution, the City authorizes the imposition of
similar annexation sales and use taxes for the 2014 fiscal year.
H. The City Council of the city of Kent, Washington, finds and
determines that the projected cost to provide municipal services to the
Panther Lake Annexation Area for the 2014 fiscal year will be at least
$11,949,899, and that this cost exceeds the projected general revenue
that the City would otherwise receive from the annexation during the 2014
fiscal year, which is estimated to be $7,719,122.
I. Pursuant to RCW 82.14.415, the city of Kent is authorized,
under the circumstances of this annexation, to impose a sales and use tax
for the 2014 fiscal year, which shall be collected by the State department
of revenue from those persons who are taxable by the state under
2 Tax Credit Threshold
Panther Lake Annexation
Chapters 82.08 and 82.12 RCW, upon the occurrence of any taxable event
within the City.
J. The rate of tax imposed shall be 0.2 percent, and shall be in
addition to other taxes authorized by law, and the threshold amount for the
2014 fiscal year is $4,230,777.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON, DOES HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Rate and Threshold Amount. The Kent City Council
determines that the threshold amount for the City's projected net cost in
providing municipal services to the Panther Lake Annexation Area for the
2014 fiscal year is $4,230,777. The City Council previously imposed a sales
and use tax at the rate of 0.2 percent, with the passage of Ordinance No.
3947 on February 16, 2010.
SECTION 2, - Implementation and certification. The Mayor of the
city of Kent is authorized to implement administrative procedures as may
be necessary to carry out the provisions of this resolution. The City's
Finance Director is authorized to certify the amount for the 2014 fiscal year
to the appropriate agencies within the State of Washington.
SECTION 3, - Severability. If any section, subsection, paragraph,
sentence, clause or phrase of this resolution is declared unconstitutional or
invalid for any reason, such decision shall not affect the validity of the
remaining portions of this resolution.
3 Tax Credit Threshold
Panther Lake Annexation
SECTION 4, - Savings. Resolution No. 1871 shall remain in full
force and effect until the effective date of this resolution.
SECTIONS. - Ratification. Any act consistent with the authority
and prior to the effective date of this resolution is hereby ratified and
affirmed.
SECTION 6, - Corrections by City Clerk or Code Reviser. Upon
approval of the City Attorney, the City Clerk and the code reviser are
authorized to make necessary corrections to this resolution, including the
correction of clerical errors; references to other local, state or federal laws,
codes, rules, or regulations; or resolution numbering and
section/subsection numbering.
SECTION 7, - Effective Date. This resolution shall take effect and
be in force immediately upon its passage, however the imposition of the
sales and use taxes for the 2014 state fiscal year authorized by this
resolution shall not take effect until the commencement of that fiscal year.
PASSED at a regular open public meeting by the City Council of the
city of Kent, Washington, this day of 2014.
CONCURRED in by the Mayor of the city of Kent this day of
2014.
SUZETTE COOKE, MAYOR
4 Tax Credit Threshold
Panther Lake Annexation
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR "PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the City Council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK
P:\Civil\I solution\Mnexadon Sales Tax Threshold2014.docx
5 Tax Credit Threshold
Panther Lake Annexation
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KENT
Agenda Item: Consent - 7G
TO: City Council
DATE: February 4, 2014
SUBJECT: Emergency Guardrail Repair Service Contract with Peterson Brothers,
Inc. - Authorize
MOTION: Authorize the Mayor to sign a contract with Petersen Brothers
Construction, Inc. to perform emergency repairs of damaged guardrails on
an as needed basis in an amount not to exceed $20,000, subject to final
terms and conditions acceptable to the City Attorney and Public Works
Director.
SUMMARY: The city typically has several guardrails that are damaged or destroyed
each year by vehicles due to severe weather or inattentive drivers. In the past we
have spent time soliciting bids for each repair. Petersen Brothers is the only business
that consistently responds and at this time is the sole provider for this service in the
region.
We are requesting the approval of this contract to be able to expedite repairs.
EXHIBITS: None
RECOMMENDED BY: Public Works Committee
YEA: Berrios - Ralph - Higgins NAY:
BUDGET IMPACTS: Funds would be made available by Council through the use of
Business and Occupation Tax.
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KENT
Agenda Item: Consent - 7H
TO: City Council
DATE: February 4, 2014
SUBJECT: 2013 Crack Sealing Project Completion - Accept
MOTION: Accept the 2012 Crack Sealing Project as complete and release
retainage to C.R. Contracting, upon receipt of standard releases from the
state and the release of any liens.
SUMMARY: Crack sealing is a maintenance treatment used to prevent water from
infiltrating cracks in a roadway. When water infiltrates cracks, it leads to accelerated
damage of the roadway. Historically, Public Works Operations crews have performed
crack sealing. Our crews still perform a significant amount of crack sealing work
annually; however, the volume of work has exceeded the time available for in-house
personnel. Therefore, several roadways in the valley were identified to have crack
sealing performed by a Contractor. The original contract amount was $195,300.00.
The final contract amount was $194,194.70.
The project consisted of installing approximately 18 tons of rubberized asphalt for
crack sealing on Central Avenue South, West Valley Highway, 84th Avenue South, 64th
Avenue South, Meeker Street and several industrial streets in the northwest corner of
the city.
The contract is now complete and ready for Council acceptance.
EXHIBITS: None
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS: This project was funded from the Business & Occupation tax
revenue.
This item did not need to be brought to Committee.
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KENT
Agenda Item: Consent - 7I
TO: City Council
DATE: February 4, 2014
SUBJECT: Oakleigh I & II Bill of Sale- Accept
MOTION: Accept the Bill of Sale for the Oakleigh I & II project, permit
2071420, for 28 gate valves, 5 hydrants, and 3,816 linear feet of waterline;
17 sanitary sewer manholes, and 2,747 linear feet of sanitary sewerline;
384 linear feet of new curb and gutter, 272 linear feet of new sidewalk, 2
street lights, and 6 street trees; 1 storm sewer catch basin, and 320 linear
feet of storm sewerline.
SUMMARY: The Oakleigh I & II project is located at 27919 106th Ave. SE; parcel
#3222059089.
EXHIBITS: Oakleigh I & II Bill of Sale
RECOMMENDED BY: Public Works Director
YEA: NAY:
BUDGET IMPACTS:
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MAIL TO:
CITY OF KENT
ENGINEERING DEPARTMENT
ATTN: Ozzie Carrasquilla
�Aj 220 — 4T" AVENUE SOUTH
WASH IN a T O a KENT, WASHINGTON 98032
Project: Oakleigh I & II
CITY OF KFNT Permit #:_RECC-2071420
JUN Q 5 201.E Location: 108" Avenue SE at SE 279th Street
ENGINEERING UEP I Parcel #: 322205-9094. -9089. -9095, -9122, -9137
BILL OF SALE
CITY OF KENT
KING COUNTY, WASHINGTON
THIS INSTRUMENT made this 12th day of April 2013, by and between Henley USA LLC, hereinafter
called "Grantors", and City of Kent, a municipal corporation of King County, State of Washington, hereinafter
called
"Grantee":
WITNESSETH:
That the said Grantors for a valuable consideration does hereby grant, bargain, sell to Grantee the following
described improvements:
A. WATERMAINS:
Together with a total of 28 gate valves at $800.00 each, 5 hydrants at $4,200 each and/or any other
appurtenances thereto.
ON FROM TO
SE 2Both Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
1071h Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 3,816 linear feet at $42.00 per LF of 8" D.I. waterline, and
300 linear feet at $50.00 per LF of 12" D.I. waterline.
Bill of Sale 14369.036.doc
1of5
B. SANITARY SEWERS:
Together with a total of 17 manholes at $3,200.00 each and/or any other appurtenances thereto.
ON FROM TO
SE 2801h Street 1081h Avenue SE West plat boundary
105th Avenue SE
106th Avenue SE
SE 278th Street
SE 279th Street
107" Place SE
SE 2771h Place
108th Avenue SE
Private Drive Access
Including 2,747 linear feet at $38.00 per LF of 8" PVC sewerline, and
611 linear feet at $50.00 per LF of 12" PVC sewerline.
C. FRONTAGEIMPROVEMENTS:
Together with lights, trees, landscaping (except residential streets) and/or any other appurtenances
ON FROM M
1081h Avenue SE SE 279th Street SE 278t" Street
Including 384 linear feet at $8.00 per LF of concrete curb and gutter, and
272 linear feet at $12.00 per LF of 6-foot concrete sidewalk, and
2 street lights at $6,500.00 each, and
6 street trees at $300.00 each.
D. STORM SEWERS:
Together with a total of 5 Type I catch basins at $950.00 each, and/or any other appurtenances
thereto.
ON FROM TO
1081h Avenue SE SE 279th Street SE 278th Street
Including 320 linear feet at $28.00 per LF of 12" PVC sewerline.
To have and to hold the same to the said Grantee, its successors and assigns forever.
The undersigned hereby covenants that it is the lawful owner of said property; and that the same is free
from all encumbrances; that all bills for labor and materials have been paid; that it has the right to sell the
same aforesaid; that it will warrant and defend the same against the lawful claims and demand of all
person(s).
The Bill of Sale is given on consideration of the agreement of the Grantee for itself, its successors and
assigns to incorporate said utilities in its utility system and to maintain them as provided in the applicable
City Ordinances. The City accepts the items subject to staff approval and completion of a 2 year
maintenance period.
Bill of Sale 1436e.036.doc
2of5
IN WITNCEESS WHEREOF, the undersigned has caused this instrument to be executed on this
L t day of 2013.
��V v,-..L,'f'\'Jv-- i=`�- L-Li.u1.C�; N'lfi,Vtet.�a• r�:,_�'._.. '..
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed on this
day of 2013,
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this day of 2013, before me, .the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared to me known to be the individual described in and
who executed the foregoing instrument, and acknowledged to me that he/she signed and sealed this
instrument as his/her free and voluntary act and deed for the uses and purposes therein mentioned.
GIVEN under my hand and official seal this day of 2013.
Notary Public in and for the State of
Washington, residing at
My Commission Expires:
Bill of Sale 14369.036.doc
3 of 5
i
STATE OF WASHINGTON )
) SS
COUNTY OF KING )
On this is day of Y 2013, before me, the
undersigned A Notary Public in and for the State of Washington, duly commissioned and sworn, personally
appeared f�t' t (`--&A1/e-// and to me to be the
PJ �c�P (,.bvo6 4d" d respectively of
FiR/ � dA the�7G�M ;,Ce®/ G>'40,IAX l"rx that executed the foregoing
instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said
Gf-C for the uses and purposes therein mentioned, and on oath stated that
they are authorized to execute the said instrument.
Witness my hand and official seal hereto affix the day and year first above written.
�449bRSGilytrid�,��
�«•�@i,�Qp1NTih�ry,„•.,/Js�se. ,€ll .�' .l.�s�iwr �
:0°4. Notary Public IW and for the ate of
*, 30 w.Z_ Washington, residing at
2014
?BeR AitP16 �0`��`` My Commission Expires:
The Bill of Sale is given and accepted pursuant to a motion duly made, seconded, and passed by the City
Council of the City of Kent, King County, Washington, on the day of
2013.
Bill of Sale 14369.036.doc
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FO
i
WASHINGTON it
ENGINEER'S CERTIFICATION
CITY OF KENT
KING COUNTY, WASHINGTON
The figures used on the Bill of Sale for the Oakleigh I and II project dated April 12,
2013, for the same said Oakleigh I and II project. Chris Jensen, the undersigned
P.E. or land surveyor is the person responsible for the preparation of the Bill of Sale and
is an employee of Barghausen Consulting Engineers, Inc., the firm responsible for
the preparation of the record drawings.
�R1S JEFys�
evA �C
O 4 11111�
Sigr ature
(Engineer stamp required)
Bill of Sale 14369.036.doc
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This page intentionally left blank.
KENT
Agenda Item: Other Business — 8A
TO: City Council
DATE: February 4, 2014
SUBJECT: Financial policy Resolution - Adopt
MOTION: Move to adopt Resolution No. , repealing Resolution No.
1859, amending financial policies to be used for guidance when enacting
and amending the city budget.
SUMMARY: This resolution amends the city's financial policies by clarifying the
requirements and available uses for the city's Strategic Opportunities Fund, first, by
confirming that non-recurring revenues only be applied to non-recurring expenses,
and second, by confirming that monies will not be spent out of this fund unless the
council first approves the expenditure.
Additionally, we have added a new, aspirational goal designed to obtain exceptional
financial stability by increasing our total government fund balance to a point where it
should carry the city through future economic downturns.
EXHIBITS: Resolution and Exhibit
RECOMMENDED BY: Operations Committee
YEA: Thomas — Ralph — Boyce (post meeting) NAY:
BUDGET IMPACTS: None
This page intentionally left blank.
RESOLUTION NO.
A RESOLUTION of the city council of the
city of Kent, Washington, repealing Resolution
1859 and adopting financial, accounting, and
budgetary policies intended to provide short and
long-term guidance to city staff for the purpose of
achieving financial stability and achieving goals
established in the City Council's Strategic Plan.
RECITALS
A. As the council developed its strategic plan, it also created a new set
of financial, accounting and budgetary policies that are intended to offer
short and long-term guidance to city staff as the city moves toward
accomplishing the goals established in the strategic plan. The council
adopted these financial policies by resolution on June 5, 2012.
B. Since implementing these policies, the council has determined that
certain policies, such as the policy pertaining to the city's "Strategic
Opportunities Fund," need clarification. Further, in order to be best
prepared for future economic downturns, the policies have been amended
to add an aspirational goal of building a solid financial reserve for all city
funds.
C. Just as the strategic plan reflects goals and a vision the city strives
to achieve, these amended policies reflect the financial goals and vision for
the city. Accordingly, the council implements these policies today with the
1 Financial Policies Resolution
understanding that not all goals can be achieved immediately, but rather
will be achieved over time.
THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES
HEREBY RESOLVE AS FOLLOWS:
RESOLUTION
SECTION 1, - Recitals. The foregoing recitals are incorporated by
this reference.
SECTION 2, - Repealer. Resolution No. 1859, adopted on June 5,
2012, is repealed in its entirety.
SECTION 3, - Policies Adopted. The city of Kent Financial Policies
attached as Exhibit A are adopted.
SECTION 4, - Severabilitv. If any one or more section, subsection,
or sentence of this resolution is held to be unconstitutional or invalid, that
decision shall not affect the validity of the remaining portion of this
resolution and that remaining portion shall maintain its full force and
effect.
SECTION S. - Effective Date. This resolution shall take effect and
be in force immediately upon its passage.
PASSED at a regular open public meeting by the city council of the
city of Kent, Washington, this day of 2014.
SUZETTE COOKE, MAYOR
2 Financial Policies Resolution
ATTEST:
RONALD F. MOORE, CITY CLERK
APPROVED AS TO FORM:
ARTHUR 11PAT" FITZPATRICK, ACTING CITY ATTORNEY
I hereby certify that this is a true and correct copy of Resolution No.
passed by the city council of the city of Kent, Washington, the
day of 2014.
RONALD F. MOORE, CITY CLERK (SEAL)
P:\Civil\Pesolution\financial Policies 2014.docx
3 Financial Policies Resolution
FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves — The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund — The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise. For the
purposes of this section, "investment opportunities" includes expenditures intended to
increase city revenues or decrease operating or capital costs. To the extent the balance in this
fund is not from a recurring revenue source, it should only be utilized for a non-operating
purpose or one time expenditure. In addition, any appropriation from this fund must first be
approved by the City Council. In the event any of this fund is used in an economic downturn to
stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projects or capital projects that reduce
recurring operational expenditures. This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs — The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of $1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its $1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational goal, the City shall maintain a
total governmental fund balance of twice the greatest volatility in year over year changes in
total revenues or $30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
Exhibit A
OPERATING BUDGET POLICIES
City Target Issues-The City Council will update its strategic plan in the early spring of each year. The
staff will use this plan for development of the following year's budget priorities and the next biennial
budget.
Budget Kickoff—The Mayor and City Council shall meet in the Spring of even numbered years to plan
the following biennial budget and agree on the anticipated revenues on which the preliminary budget will
be based. The City Council shall review revenue estimates and preview potential changes to revenues.
The City Council shall then approve the revenue amount that will be used by the Mayor to form the initial
preliminary budget. The Mayor and City Council will meet additionally in late Summer to re-review the
revenue estimates to adjust them more closely to the additional revenue information that has become
available with the passage of time. Any changes resulting from this meeting shall be incorporated into
the preliminary budget to be considered by City Council.
Program Reviews — The Mayor shall perform a periodic review of staff and programs of the City for
both efficiency and effectiveness.Alternate methods of delivery will be evaluated for providing services.
Programs that are determined to be inefficient, ineffective, or inconsistent with the City Council's
strategic goals shall be reduced in scope or eliminated.
Preliminary Budget — The Mayor shall propose a preliminary budget in the Fall of even numbered
years. The preliminary budget will be developed in accordance with the revenues approved by the City
Council at the budget kickoff as amended. If the preliminary budget is based on revenues in excess of
those approved by City Council,the Mayor will present the justification for the increased revenues or the
additional proposed revenue sources.
Structurally Balanced Budget—The Mayor shall present, and the City Council shall adopt a budget in
which ongoing revenues equal or exceed ongoing expenditures. One time revenues shall not be used
to pay for recurring expenditures.
Conservative Expenditure Budgeting-The City will maintain its conservative expenditure budgeting
with respect to budgeting existing full time positions for a full year.
Acceptance of Grants —The City shall review any requirements for ongoing costs from any grant for
operational purposes. Any requirement to fund any portion of the costs as a condition of receipt of the
grant shall be a consideration in the decision to accept or reject the grant.
Self Supporting Proprietary Funds-The City's water, sewer and golf course enterprise funds will be
self supporting along with its internal service funds. The cost of providing services is expected to be
fully funded from charges for the service. If the funds produce a loss, rates will be adjusted to achieve,
at minimum, a break even status. If debt has been issued which requires a certain level of return, rates
and charges will be adjusted to achieve those returns.
Health Insurance Reserves — The target reserve for the Health Insurance Fund shall be two times
IBNR.
Full Cost of Service — The City will define its basic services to our residents. The services will be
evaluated as to their full cost. This information will be incorporated and presented as a section of the
annual budget.
Exhibit A
REVENUE AND COLLECTIONS
Aggressive Collection Effort- The City will follow an aggressive policy of collecting all monies due the
City to the extent that the collection efforts remain cost effective.
Reimbursements on a timely basis—Many grants occur on a cost reimbursement basis. To maximize
the City's available investable funds, reimbursement should be pursued on a timely basis.
User Charges Related to Costs - The City will review fees and charges on an annual basis and will
modify charges to adequately keep pace with increasing costs of providing services.
User Charges and Taxes Related to Market Rates- The City will consider its user charges and its tax
rates in connection with those of comparable sized communities and similar service providers, so that it
will provide reasonable rates to maintain its advantage in the market place in attracting businesses and
residences to the City of Kent.
CAPITAL BUDGETING
Committed Special Revenue Funds - The City will maintain its practice of designating its street and
capital improvement revenue sources including a percentage of its sales tax collections for the funding of
its capital improvement program.
Capital Improvement Program - The City will update its capital facilities plan on an annual basis as
required by the Growth Management Act. A preliminary plan will be established early in the budgeting
process to serve as a guideline during the year,with a final amendment adopted with the adoption of the
operating budgets to reflect the necessary changes in the City's Comprehensive Plan.
DEBT POLICIES
Projects Funded by Bonds — The use of long-term debt shall be minimized. The City should issue
debt only for major capital projects. Debt should only be authorized for projects where the life of the
asset constructed or acquired exceeds the life of the debt.
Debt Service— To ensure that the City always meets all of their debt obligations, payments on
outstanding debt shall be the highest priority before payment for other capital expenditures.
Bond Rating-The Citywill continue to strive to improve its bond rating by improving its financial stability.
Debt Capacity - The City strives to maintain adequate available debt capacity for large top priority
projects.
Bonding Limitations— Direct General Obligation Debt will not exceed 1.5% of assessed value; direct
and indirect debt will not exceed 4% of assessed value; duration of the debt will not exceed 15 years.
Revenue Debt Covenants—Will be based on the volatility of the revenues.
Arbitrage regulations—Will be strictly followed.
Special Assessment Guaranty Fund-The City will strive to maintain adequate reserves for retirement
of special assessment debt through the maintenance of a special assessment guaranty fund at least 10%
of outstanding special assessment debt.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost effective to
both the borrowing and the lending fund, and the funds will not be needed by the loaning fund during the
term of the loan. Such borrowing shall implement Council directed policy in a simplified manner, such as
borrowing associated with interim financing for local improvement district projects. A repayment plan
Exhibit A
should be approved along with the loan. The Mayor may approve loans for a term of one year. The
Council must approve loans with terms longer than one year.
INVESTMENT POLICY
Investment Security&Earnings Maximization-An investment policy was implemented per Ordinance
#3278 in 1996 which detail the City's investment guidelines. The primary objective is to preserve the
principal of the investment portfolio while maximizing the portfolio's return.
FINANCIAL REPORTING
Reporting frequency — Monthly budget and actual reports will be available to departments and a
quarterly report will be presented to the City Council Operations Committee.
Annual Report—Will be completed within 180 days.
Reporting Improvements-The City will strive to continue to make improvements in its financial reporting
scheme so that information available to the public,the City's governing bodies and other city departments
is timely and the best available for sound financial decisions.
Bondholders'Report— The City will prepare an annual report to bondholders.
Full Disclosure—All public reports will contain full and complete disclosure of all material matters.
Financial Trend Monitoring - The City will develop a program to evaluate its financial condition and
establish a system for correcting any deficiencies noted.
Annual Audits - The City will assist the State Auditor's Office in whatever way possible in conjunction
with the preparation of the annual audit,and will implement modifications identified bythe State Auditorto
improve the City's internal control and financial practices.
Updates to these Policies—The Operations Committee of the City Council shall review these policies at
least every four years. It is recommended that the review is done biennially during the budget process.
Exhibit A
ACCOUNTING
Generally Accepted Accounting Principles-The City will maintain its position as a leader in producing
financial reports in conformance with generally accepted accounting principles and pronouncements by
the Governmental Accounting Standards Board.
Basis of Accounting - The basis for accounting for the general fund, special revenue, debt service,
capital projects and agency funds is modified accrual. Modified accrual recognizes revenues when they
become both measurable and available to finance expenditures of the current period. The basis of
accounting forthe enterprise, internal service funds and pension trustfund is full accrual. The appropriate
basis is used throughout the budgeting, accounting and reporting processes, with few exceptions as
noted below. Full accrual is a method of accounting that matches revenues and expenses with the period
to which they relate, rather than focusing on actual cash flows. In this method, for example, an asset is
depreciated as it is "used up", and the expense is recognized in periodic increments, rather than
assuming the asset holds its value until it is actually disposed of. However, since the focus in budgeting
is on the revenues and expendable accounts, depreciation and amortization are not considered budgetary
accounts, and are excluded from the budgeting system. Likewise, debt service and capital expenditures
are presented as the payments occur, departing from GAAP in this regard, in the budget document. Also,
Trust and Agency Funds that may not be expended for governmental operations are excluded from this
budget document.
The presentation of the program budget departs from the basis of the legal budget by eliminating inter city
transactions and allocating the net increases or decreases from internal services to the using programs.
This is done to give the user a more complete picture of the total costs of the operating programs.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
The City of Kent, as all governmental units, operates its budget and accounting system based on a fund
structure. Funds are established to segregate specific revenue to ensure their expenditure within
applicable legal and contractual provisions. Revenues are allocated to and accounted for in individual
funds based on the purposes for which they are to be spent and the means by which the spending
activities are to be controlled. The City of Kent operates with seven basic fund types. Within each fund
type there may exist one or more individual funds. The City of Kent operates with 26 individual funds.
The fund types are listed below under their three major subheadings.
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
GOVERNMENTAL FUNDS
General Fund
The General Fund is the principal operating The General Fund "buys" services from the
fund of the City. It accounts for the financial Internal Service Funds: fuel and rental of
resources of the City which are not accounted vehicles from the Equipment Rental Fund;
for in any other fund. Principal sources of supplies, postage, photocopy, printing and
revenue are property taxes, sales and use graphics, cable TV services, data processing
taxes, utility taxes, licenses and permits, state and telephone services from Central Services;
shared revenues, charges for services and facility maintenance and operation services
interest income. Primary expenditures are for from Facilities; and insurance from the
general City administration, police and fire Insurance Fund. Costs are allocated to all
protection, engineering and planning services, funds in an effort to distribute accounting,
park and street maintenance, and cultural and budgeting, legal and human resource services
recreational services. as well as street, engineering and park
services. General Fund also transfers funds for
minor projects.
Special Revenue Funds
Special Revenue Funds are used to account for Taxes and grants are collected in the Street
specific revenue sources that would otherwise Fund, LEOFF1 Retirees Fund, Lodging Tax
be accounted for in the General Fund, but for Fund, Youth Teen Programs Fund, Capital
which there exists certain legal restrictions as to Improvement Fund, Criminal Justice Fund,
the use of certain revenues. The revenue is Community Development Block Grant Fund,
segregated into individual special revenue funds Other Operating Projects Fund, and the Kent
to ensure expenditure for a designated purpose. Events Center Operating Fund. Transfers from
Principal sources of revenue are: state shared the Street and Capital Improvement Funds are
fuel tax, earmarked sales and utility taxes and primarily to the Capital Project Funds or the
community development block grant funds. The LTGO Debt Service Fund.
major portion of these resources are transferred
to other funds for debt retirement, capital
acquisition and specific purposes operations.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Debt Service Funds
Debt Service Funds are used to account for the The Debt Service Funds receive the transfers
accumulation of resources to be used for the from the Special Revenue Funds, Water Fund
retirement of general long-term debt. The City and Sewerage Funds to pay principal and
has three types of general long-term debt for interest on LTGO debt issues.
which resources are accumulated: general
obligation long-term debt (voted, general
obligation long-term debt and LTGO)and special
assessment debt. Sources of revenue to fund
the retirement of general obligation long-term
debt are property taxes and transfers in from
other funds. Special assessments are levied
and received to retire special assessment debt.
Capital Projects Funds
Capital Projects Funds are used to account for Transfers are received from Special Revenue
the financing of major one time only capital and other funds as a partial source of funds
projects other than those financed by Proprietary needed to complete projects.
Funds. Sources of revenue are: proceeds of
debt issuance, grants, and transfers from other
funds.
PROPRIETARY FUNDS
Enterprise Funds
Enterprise Funds are used to account for the The Enterprise Funds "buy" services from the
financing of services provided to the general Equipment Rental Fund for equipment rental and
public where all or most of the costs involved are fuel; from the Insurance Fund for insurance
paid for by user charges. Operations financed needs; from the Central Service Funds for
as enterprise funds are operated in a manner stores, telephone, postage, photocopying,
similar to private business enterprises. Kent's printing and graphics, cable TV services, data
enterprise funds are funded through water, processing and telecommunications; and from
sewer, and drainage utility charges and the Facilities Fund for facility maintenance and
recreational charges at the City's golf complex. operation services. The Enterprise Funds also
reimburse the General Fund for cost allocations
for budgeting,accounting, human resource, legal
and engineering costs which relate to Enterprise
Funds. Other funds purchase utilities at the
same rate as the general public.
Exhibit A
BUDGET AND ACCOUNTING STRUCTURE
FUND/PURPOSE RELATIONSHIP TO OTHER FUNDS
Internal Service Funds
Internal Service Funds are used to account for Centralizes costs for equipment rental, central
the financing of specific services performed by services and insurance. These services are
designated organizations within the City for "sold" to other funds at cost plus a reserve for
other organizations within the City. The City's future needs.
Equipment Rental, Central Service, Facilities
Maintenance and Planning, and Insurance
Funds provide centrally administered services
then generate revenue by billing the
organization to which the service is provided.
FIDUCIARY FUND TYPES
Trust and Agency Funds
Trust and Agency Funds are used to account
for assets held by the City as trustee or agent
for individuals, private organizations or other
governmental units. Since their funds are not
expendable for City operations they are not
included in the budget. However, per state
auditor requirements, estimates are provided
for their activities.
Exhibit A
BUDGET AND SPENDING CONTROL SYSTEM
Budgets serve as control mechanisms in the operations of governmental units. Legal budgetary
(expenditure) control in the City of Kent is maintained at the fund level. Administration can amend
budgets, with no overall dollar increase between departments, within a fund. Supplemental
appropriations that amend total expenditures, or in the case of Proprietary Funds amend working
capital, require a City Council ordinance. All operating budgets lapse at the end of the biennium.
Within each year of the biennium, a single year allocation will be adopted and operate as if it were
an annual budget.
General and Special Revenue Funds control expenditures with a legal biennial budget at the fund
level. Debt Service Funds operate under the control of the bond indentures which established
them. Capital Projects Funds operate under the control of total project authorization, rather than the
annual budget. Proprietary Funds control expenditures with a flexible budget whereby the
expenditure increases must be offset by increased resources. Though budgetary control is at the
fund level, budget and actual information is maintained by project, organization, program and
object. Both budget and actual information is presented on a GAAP basis of accounting, when
presented by fund.
The City must adopt its biennial budget by December of the preceding fiscal year. This usually
follows six months of analysis by staff and City Council. The first step involves the establishment of
the baseline revenue budget by the City Council. The second step is to review the City Council
Strategic Goals and begin budget development to assist in achieving those goals.Third, undertake
a program review to ensure that current program offerings are in agreement with City Council goals
and priorities. The emphasis is placed on the General and Special Revenue Funds since the
operation of other funds are tied to ordinances, contractual agreements or separately established
rate structures. Once the baseline operations have been reviewed and adjusted based on
administrative policy, program expansion is included to the level of projected available resources
after the establishment of sufficient fund balances.
A mid-biennium review is undertaken during the second year of the biennium in which any changes
to the initial estimates of revenues and expenditures are to be reviewed. Such changes will be
presented by the Mayor and discussed by the City Council. Any agreed upon changes shall be
approved with an ordinance adopting changes to the biennial budget.
After the preliminary budget document is prepared, the City Council spends approximately one
month reviewing it. Public meetings are held to gather public input. When the budget review and
final adjustment period is complete a balanced budget as required by state law is adopted by
ordinance. After adoption, periodic budget adjustments that affect total fund expenditures are made
as approved by City Council, but a final budget adjustment ordinance covering all approved
changes is adopted at year end or the beginning of the next biennium.
This page intentionally left blank.
FINANCIAL POLICIES
FINANCIAL STABILITY POLICIES
General Fund Reserves—The target for the General Fund Contingency Reserve is 10% of
the General Fund budgeted expenditures or an amount that will maintain sufficient cash flow,
whichever is greater. The policy is designed to provide a fiscal cushion and meet seasonal
cash flow shortfalls. If the General fund reserve goes below 10%, based on the ending fund
balance on December 31 of each year, the City shall take steps to rebuild the reserve within
the next fiscal year.
Strategic Opportunities Fund —The City shall annually transfer any amount in excess of the
10% General Fund Contingency Reserve in the General Fund to this fund, after first funding
the Contingency for Unanticipated Costs. This fund will act as if it is a permanent fund except
that it may be used to take advantage of investment opportunities that may arise ..
AsTo the extent ,
this fund _"a" GAIY be 61t I Zed
Lhen
the
first a roved b City Council. In the event any of this funds used inlanfeco omit dovvnt is
pp y y y wnturn
to stabilize city finances, such appropriation shall be repaid to the fund annually over the next
three years.
Capital Reserve Fund — The City shall annually budget a minimum of $250,000 into a
reserve for the general capital needs of the City. Such fund may be used for unanticipated
capital needs typically resulting from a natural disaster. This fund is designated to act as a
stabilization fund for general capital and may, with a specific appropriation by City Council, be
used for investment in revenue producing capital projectsr
This fund shall be enumerated in the budget and accrue
each year.
Contingency for Unanticipated Costs—The City will annually budget no less than $500,000
in the General fund for unanticipated costs. This amount, if unused, will be transferred in to a
project account until the amount reaches a maximum of$1,500,000. If the fund or any portion
of it is used, the City shall restore the balance to its$1,500,000 within three years.
Maintenance and Operational Planning — Maintenance of current assets shall take priority
over new capital projects whenever possible. The City Council shall ensure that there are
stable sources of revenue to fund ongoing maintenance of capital assets. Before any new
capital asset is approved, staff shall present an estimate of the life cycle and maintenance
cost. Such costs shall be included in the budgets for the following years. The City Council
shall not approve of new capital projects unless there is funding for the ongoing maintenance
of the asset. The City shall maintain an inventory of all City assets and costs of maintenance
of those assets.
Total Governmental Funds Reserves — As an aspirational coal, the City shall maintain a� Formatted:Font:Bold
total governmental fund balance of twice the greatest volatility in year over year changes in Formatted:Indent:Left: 0.12"
total revenues or$30 million, whichever is greater.
DEBT POLICIES
Projects Funded by Bonds—The use of long-term debt shall be minimized. The City should
issue debt only for major capital projects. Debt should only be authorized for projects where
the life of the asset constructed or acquired exceeds the life of the debt.
Debt Service—To ensure that the City always meets all of their debt obligations, payments
on outstanding debt shall be the highest priority before payment for other capital expenditures.
Interfund Borrowing - The City will use interfund borrowing where such borrowing is cost
effective to both the borrowing and the lending fund, and the funds will not be needed by the
loaning fund during the term of the loan. Such borrowing shall implement Council directed
policy in a simplified manner, such as borrowing associated with interim financing for local
improvement district projects. A repayment plan should be approved along with the loan. The
Mayor may approve loans for a term of one year. The Council must approve loans with terms
longer than one year.
BIDS
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REPORTS FROM STAFF, COUNCIL COMMITTEES, AND SPECIAL COMMITTEES
A. Council President
B. Mayor
C. Administration
D. Economic & Community Development
E. Operations
F. Parks & Human Services
G. Public Safety
H. Public Works
I. Regional Fire Authority
J. Other
K. Other
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EXECUTIVE SESSION
ACTION AFTER EXECUTIVE SESSION
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