HomeMy WebLinkAbout3209CITY OF KENT, WASHINGTON
ORDINANCE NO. 3-2- t)
AN ORDINANCE of the City of Kent, Washington,
relating to contracting indebtedness; providing for the
issuance of $5,420,000 par value of Limited Tax General
Obligation and Refunding Bonds, 1995, of the City to
provide part of the funds with which to pay the cost of
advance refunding the City's outstanding Golf Complex
Revenue Bonds, 1988, acquiring, constructing and
installing certain improvements to the City's Golf
Complex and paying the administrative costs of such
refunding and the costs of issuance and sale of such
bonds; fixing the date, form, maturities, interest rates,
terms and covenants of such bonds; establishing a bond
redemption fund and a project fund; providing for and
authorizing the purchase of certain obligations out of
the proceeds of the sale of the bonds herein authorized
and for the use and application of the money derived from
those investments; authorizing the execution of an
agreement with West One Bank Idaho of Boise, Idaho, as
refunding trustee; providing for the call, payment and
redemption of the outstanding bonds to be refunded;
providing for bond insurance; and approving the sale and
providing for the delivery of the bonds to Lehman
Brothers Inc. of Seattle, Washington.
This document prepared by:
Foster Pepper & Shefelman
1111 Third Avenue, Suite 3400
Seattle, Washington 98101
(206) 447-4400
0161487.04
CITY OF KENT, WASHINGTON
LIMITED TAX GENERAL OBLIGATION AND REFUNDING BONDS, 1995
Paste
Recitals.
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. 1
Section
1.
Definitions . . . . . . . . . . . . . . . . .
. 3
Section
2.
Debt Capacity . . . . . . . . . . . . . . . .
. 6
Section
3.
Authorization of Bonds . . . . . . . . . . .
. 6
Section
4.
Description of Bonds . . . . . . . . . . . .
. 7
Section
5.
Registration and Transfer of Bonds . . . . .
. 8
Section
6.
Payment of Bonds . . . . . . . . . . . . . .
. 9
Section
7.
Optional Redemption and Open Market
Purchase of Bonds . . . . . . . . . . . . .
. 9
Section
8.
Notice of Redemption . . . . . . . . . . . . .
. 10
Section
9.
Failure to Redeem Bonds . . . . . . . . . . .
. 11
Section
10.
Pledge of Taxes . . . . . . . . . . . . . . .
. 11
Section
11.
Form and Execution of Bonds . . . . . . . . .
. 12
Section
12.
Bond Registrar . . . . . . . . . . . . . . .
. 13
Section
13.
Preservation of Tax Exemption for Interest
on Bonds . . . . . . . . . . . . . . . . .
. 14
Section
14.
Refunding of the 1988 Bonds . . . . . . . . .
. 14
Section
15.
Call for Redemption of the 1988 Bonds . . . .
. 18
Section
16.
City Findings with Respect to Refunding . . .
. 18
Section
17.
Transfer of City Funds . . . . . . . . . . .
. 19
Section
18.
Bonds Negotiable . . . . . . . . . . . . . .
. 19
Section
19.
Refunding or Defeasance of the Bonds . . . .
. 19
Section
20.
Bond Fund; Project Fund; and Deposit
of Bond Proceeds . . . . . . . . . . . . .
. 21
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Paae
Section
21.
Approval of Bond Purchase Contract . . . . .
. 22
Section
22.
Preliminary Official Statement Deemed Final .
. 22
Section
23.
Bond Insurance . . . . . . . . . . . . . . .
. 23
Section
24.
Temporary Bond . . . . . . . . . . . . . . .
. 23
Section
25.
Effective Date of Ordinance . . . . . . . . .
. 24
Signatures.
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. 24
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CITY OF KENT, WASHINGTON
ORDINANCE NO.
AN ORDINANCE of the City of Kent, Washington,
relating to contracting indebtedness; providing for the
issuance of $5,420,000 par value of Limited Tax General
Obligation and Refunding Bonds, 1995, of the City to
provide part of the funds with which to pay the cost of
advance refunding the City's outstanding Golf Complex
Revenue Bonds, 1988, acquiring, constructing and
installing certain improvements to the City's Golf
Complex and paying the administrative costs of such
refunding and the costs of issuance and sale of such
bonds; fixing the date, form, maturities, interest rates,
terms and covenants of such bonds; establishing a bond
redemption fund and a project fund; providing for and
authorizing the purchase of certain obligations out of
the proceeds of the sale of the bonds herein authorized
and for the use and application of the money derived from
those investments; authorizing the execution of an
agreement with West One Bank Idaho of Boise, Idaho, as
refunding trustee; providing for the call, payment and
redemption of the outstanding bonds to be refunded;
providing for bond insurance; and approving the sale and
providing for the delivery of the bonds to Lehman
Brothers Inc. of Seattle, Washington.
WHEREAS, the City of Kent, Washington (the "City"), owns and
operates an 18 -hole regulation municipal golf course, a 9 -hole par
3 golf course, driving range and mini -putt course, together with
other recreational facilities related thereto (the "Golf Complex");
and
WHEREAS, pursuant to Ordinance No. 2790, the City heretofore
issued its $5,285,000 par value Golf Complex Revenue Bonds, 1988
(the 111988 Bonds"), for the purpose of providing a portion of the
funds to develop and construct the 18 -hole municipal golf course,
and by that ordinance reserved the right to redeem the 1988 Bonds
prior to their maturity on December 1, 1998, at a price of 102% of
par plus accrued interest to the date fixed for redemption; and
0161487.04
WHEREAS, there are presently outstanding $4,510,000 par value
of 1988 Bonds maturing on December 1 of each of the years 1995
through 2000, inclusive, and in the year 2008, and bearing various
interest rates from 7.20% to 8.40%; and
WHEREAS, after due consideration, it appears to the City
Council that all of the outstanding 1988 Bonds (the "Refunded
Bonds") may be refunded by the issuance and sale of the limited tax
general obligation and refunding bonds authorized herein (the
"Bonds") so that a substantial savings will be effected by the
difference between the principal and interest cost over the life of
the portion of the Bonds allocated to the refunding and the
principal and interest cost over the life of the 1988 Bonds but for
such refunding, which refunding will be effected by:
and
(a) The issuance of the Bonds and the payment of the
costs of the issuance of the Bonds and the costs of
the refunding;
(b) The use of money deposited in the Golf Complex
Revenue Bond Fund, 1988; and
(c) The payment of the principal of and interest on the
1988 Bonds when due up to and including December 1,
1998, and the call, payment and redemption on
December 1, 1998, of all of the then -outstanding
1988 Bonds at a price of 102% of par;
WHEREAS, to effect that refunding in the manner that will be
most advantageous to the City it is found necessary and advisable
that certain Acquired Obligations (hereinafter defined) bearing
interest and maturing at such time or times as necessary to
accomplish the refunding as aforesaid be purchased out of a portion
of the proceeds of the Bonds and other money of the City; and
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WHEREAS, the City Council has determined that it is in the
best interests of the City to make certain improvements to the Golf
Complex, the estimated cost of which is $1,025,000 (including an
allocable portion of the costs of issuance of the Bonds), and the
City does not have available sufficient funds to pay the cost of
such improvements; and
WHEREAS, the City Council deems it to be in the best interests
of the City to issue and sell the Bonds to pay part of the cost of
advance refunding the 1988 Bonds, acquiring, constructing and
installing certain improvements to the Golf Complex, and paying the
administrative costs of such refunding and the costs of issuance
and sale of the Bonds; and
WHEREAS, Lehman Brothers Inc. of Seattle, Washington, has
offered to purchase the Bonds under the terms and conditions
hereinafter set forth; and
WHEREAS, Financial Security Assurance, Inc., has made a
commitment to issue an insurance policy (the "Municipal Bond
Insurance Policy") relating to the Bonds effective as of the date
of issuance of the Bonds, and the City Council deems that the
purchase of the Municipal Bond Insurance Policy is in the best
interest of the City; NOW, THEREFORE,
THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES ORDAIN
as follows:
Section 1. Definitions. As used in this ordinance, the
following words shall have the following meanings:
"Acquired Obligations" means those United States Treasury
Certificates of Indebtedness, Notes and Bonds --State and Local
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Government Series and other direct, noncallable obligations of the
United States of America purchased to accomplish the refunding of
the 1988 Bonds as authorized by this ordinance.
"Bond Fund" means the Limited Tax General Obligation and
Refunding Bond Fund, 1995, created by this ordinance for the
payment of the Bonds.
"Bond Insurer" means Financial Security Assurance, Inc., of
New York, New York.
"Bond Register" means the books or records maintained by the
Bond Registrar containing the name and mailing address of the owner
of each Bond and the principal amount and number of Bonds held by
each owner.
"Bond Registrar" means the fiscal agencies of the State of
Washington in Seattle, Washington, and New York, New York, as the
same may be designated from time to time.
"Bonds" means the $5,420,000 par value Limited Tax General
Obligation and Refunding Bonds, 1995, of the City issued pursuant
to and for the purposes provided in this ordinance.
111988 Bond Fund" means the City's Golf Complex Revenue Bond
Fund, 1988.
111988 Bonds" means the outstanding Golf Complex Revenue Bonds,
1988, of the City issued pursuant to Ordinance No. 2790, the
refunding of which has been provided for by this ordinance.
"City" means the City of Kent, Washington, a municipal
corporation duly organized and existing under and by virtue of the
laws of the State of Washington.
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"Code" means the United States Internal Revenue Code of 1986,
as amended, and applicable rules and regulations promulgated
thereunder.
"Finance Director" means the Finance Division Director of the
City.
"Golf Complex" means the City's existing 9 -hole par 3 golf
course, driving range and mini -putt course, the 18 -hole regulation
municipal golf course, all golf related buildings, facilities and
equipment, and any other golf recreational facilities which
hereafter may be acquired, constructed or combined lawfully with
the existing facilities, together with all additions thereto and
betterments and extensions thereof at any time made or constructed.
"Government Obligations" means direct, noncallable obligations
of the United States of America.
"Municipal Bond Insurance Policy" means the policy issued by
the Bond Insurer insuring the payment of the principal of and
interest on the Bonds.
"Refunding Plan" means:
(a) the placement of sufficient proceeds of the
Bonds which, with other money of the City, if necessary,
will acquire the Acquired Obligations to be deposited,
with cash, if necessary, with the Refunding Trustee;
(b) the payment of the principal of and interest on
the 1988 Bonds when due up to and including December 1,
1998, and the call, payment and redemption on December 1,
1998, of all of the then -outstanding 1988 Bonds at a
price of 102% of par; and
(c) the payment of the costs of issuing the Bonds
and the costs of carrying out the foregoing elements of
the Refunding Plan.
"Refunding Trust Agreement" means a Refunding Trust Agreement
between the City and the Refunding Trustee substantially in the
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form of that which is on file with the City Clerk and by this
reference incorporated herein.
"Refunding Trustee" means West One Bank Idaho of Boise, Idaho,
serving as trustee or escrow agent or any successor trustee or
escrow agent.
Section 2. Debt Capacity. The assessed valuation of the
taxable property within the City as ascertained by the last
preceding assessment for City purposes for the calendar year 1994
is $3,893,431,079, and the City has outstanding general
indebtedness evidenced by limited tax general obligation bonds and
conditional sales contracts in the principal amount of $15,132,006
incurred within the limit of up to 1-1/2% of the value of the
taxable property within the City permitted for general municipal
purposes without a vote of the qualified voters therein, unlimited
tax general obligation bonds in the principal amount of $16,730,000
incurred within the limit of up to 2-1/2% of the value of the
taxable property within the City for capital purposes only issued
pursuant to a vote of the qualified voters of the City, and the
amount of indebtedness for which bonds are authorized herein to be
issued is $5,420,000.
Section 3. Authorization of Bonds. The City shall borrow
money on the credit of the City and issue negotiable limited tax
general obligation bonds evidencing that indebtedness in the amount
of $5,420,000 for general City purposes to pay part of the cost
carrying out the Refunding Plan, acquiring constructing and
installing certain improvements to the Golf Complex (the
"Project"), and paying the costs of issuance and sale of the Bonds
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(the "costs of issuance"). The general indebtedness to be incurred
shall be within the limit of up to 1-1/2% of the value of the
taxable property within the City permitted for general municipal
purposes without a vote of the qualified voters therein.
Section 4. Description of Bonds. The Bonds shall be called
Limited Tax General Obligation and Refunding Bonds, 1995, of the
City; shall be in the aggregate principal amount of $5,420,000;
shall be dated January 1, 1995; shall be in the denomination of
$5,000 or any integral multiple thereof within a single maturity;
shall be numbered separately in the manner and with any additional
designation as the Bond Registrar deems necessary for purposes of
identification; shall bear interest (computed on the basis of a
360 -day year of twelve 30 -day months) payable semiannually on each
June 1 and December 1, commencing June 1, 1995, to the maturity or
early redemption of the Bonds; and shall mature on December 1 in
years and amounts and bear interest at the rates per annum as
follows:
Maturity
Interest
Years
Amounts
Rates
1998
$285,000
5.25%
1999
315,000
5.35
2000
335,000
5.40
2001
350,000
5.50
2002
370,000
5.60
2003
395,000
5.70
2004
410,000
5.80
2005
440,000
5.90
2006
465,000
6.00
2007
495,000
6.10
2008
525,000
6.20
2009
500,000
6.20
2010
535,000
6.25
Portions of the above maturity amounts are allocated to paying
the respective costs of the Project and of carrying out the
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Refunding Plan, including a ratable share of proceeds used to pay
the costs of issuance of the Bonds, in accordance with the
following schedule:
Maturity Refunding New Money
Years Allocation Allocation Total
1998 $285,000 -- $285,000
1999 315,000 -- 315,000
2000 335,000 -- 335,000
2001 350,000 -- 350,000
2002 370,000 -- 370,000
2003 395,000 -- 395,000
2004 410,000 -- 410,000
2005 440,000 -- 440,000
2006 465,000 -- 465,000
2007 495,000 -- 495,000
2008 525,000 -- 525,000
2009 -- 500,000 500,000
2010 -- 535,000 535,000
The life of the Project to be acquired or constructed with the
proceeds of the Bonds exceeds the term of the Bonds.
Section 5. Registration and Transfer of Bonds. The Bonds
shall be issued only in registered form as to both principal and
interest and shall be recorded on the Bond Register. The Bond
Register shall contain the name and mailing address of the owner of
each Bond and the principal amount and number of each of the Bonds
held by each owner.
Bonds surrendered to the Bond Registrar may be exchanged for
Bonds in any authorized denomination of an equal aggregate
principal amount and of the same interest rate and maturity. Bonds
may be transferred only if endorsed in the manner provided thereon
and surrendered to the Bond Registrar. Any exchange or transfer
shall be without cost to the owner or transferee. The Bond
Registrar shall not be obligated to exchange or transfer any Bond
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during the 15 days preceding any principal payment or redemption
date.
Section 6. Payment of Bonds. 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 paid by checks or
drafts of the Bond Registrar mailed on the interest payment date to
the registered owners at the addresses appearing on the Bond
Register on the 15th day of the month preceding the interest
payment date. Principal of the Bonds shall be payable upon
presentation and surrender of the Bonds by the registered owners at
either of the principal offices of the Bond Registrar at the option
of the owners.
Section 7. Optional Redemption and Open Market Purchase of
Bonds. Bonds maturing in the years 1998 through 2004, inclusive,
shall be issued without the right or option of the City to redeem
those Bonds prior to their stated maturity dates. The City
reserves the right and option to redeem Bonds maturing on or after
December 1, 2005, prior to their stated maturity dates at any time
on or after December 1, 2004, as a whole or in part within one or
more maturities selected by the City (and by lot within a maturity
in such manner as the Bond Registrar shall determine), at the
following prices expressed as a percentage of par, plus accrued
interest to the date fixed for redemption:
Redemption Date Redemption Price
Dec. 1, 2004, through Nov. 30, 2005 101%
Dec. 1, 2005, and thereafter 100 (par)
Portions of the principal amount of any Bond, in installments
of $5,000 or any integral multiple thereof, may be redeemed. If
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less than all of the principal amount of any Bond is redeemed, upon
surrender of that Bond at either of the principal offices of the
Bond Registrar, there shall be issued to the registered owner,
without charge therefor, a new Bond (or Bonds, at the option of the
registered owner) of the same maturity and interest rate in any of
the denominations authorized by this ordinance in the aggregate
principal amount remaining unredeemed.
The City further reserves the right and option to purchase any
or all of the Bonds in the open market at any time at any price
acceptable to the City plus accrued interest to the date of
purchase.
All Bonds purchased or redeemed under this section shall be
canceled.
Section 8. Notice of Redemption. The City shall cause notice
of any intended redemption of Bonds to be given not less than
30 nor more than 60 days prior to the date fixed for redemption by
first-class mail, postage prepaid, to the registered owner of any
Bond to be redeemed at the address appearing on the Bond Register
at the time the Bond Registrar prepares the notice, and the
requirements of this sentence shall be deemed to have been
fulfilled when notice has been mailed as so provided, whether or
not it is actually received by the owner of any Bond. Interest on
Bonds called for redemption shall cease to accrue on the date fixed
for redemption unless the Bond or Bonds called are not redeemed
when presented pursuant to the call. In addition, the redemption
notice shall be mailed within the same period, postage prepaid, to
Moody's Investors Service, Inc., and Standard & Poor's Ratings
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Group at their offices in New York, New York, or their successors,
to Lehman Brothers Inc. at its principal office in Seattle,
Washington, or its successor, to the Bond Insurer at its principal
office in New York, New York, or its successor, and to such other
persons and with such additional information as the Finance
Director shall determine, but these additional mailings shall not
be a condition precedent to the redemption of Bonds.
Section 9. Failure to Redeem Bonds. If any Bond is not
redeemed when properly presented at its maturity or call date, the
City shall be obligated to pay interest on that Bond at the same
rate provided in the Bond from and after its maturity or call date
until that Bond, both principal and interest, is paid in full or
until sufficient money for its payment in full is on deposit in the
Bond Fund hereinafter created and the Bond has been called for
payment by giving notice of that call to the registered owner of
each of those unpaid Bonds.
Section 10. Pledge of Taxes. For as long as any of the Bonds
are outstanding, the City irrevocably pledges to include in its
budget and levy taxes annually within the constitutional and
statutory tax limitations provided by law without a vote of the
electors of the City on all of the taxable property within the City
in an amount sufficient, together with other money legally
available and to be used therefor (including such revenues from the
Golf Complex as the City may allocate to pay the Bonds) , to pay
when due the principal of and interest on the Bonds, and the full
faith, credit and resources of the City are pledged irrevocably for
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the annual levy and collection of those taxes and the prompt
payment of that principal and interest.
Section 11. Form and Execution of Bonds. The Bonds shall be
printed or lithographed on good bond paper in a form consistent
with the provisions of this ordinance and state law and shall be
signed by the Mayor and City Clerk, either or both of whose
signatures may be manual or in facsimile, and the seal of the City
or a facsimile reproduction thereof shall be impressed or printed
thereon.
Only Bonds bearing a Certificate of Authentication in the
following form, manually signed by the Bond Registrar, shall be
valid or obligatory for any purpose or entitled to the benefits of
this ordinance:
CERTIFICATE OF AUTHENTICATION
This Bond is one of the fully registered City of
Kent, Washington, Limited Tax General Obligation and
Refunding Bonds, 1995, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY
Bond Registrar
By
Authorized Signer
The authorized signing of a Certificate of Authentication shall be
conclusive evidence that the Bonds so authenticated have been duly
executed, authenticated and delivered and are entitled to the
benefits of this ordinance.
If any officer whose facsimile signature appears on the Bonds
ceases to be an officer of the City authorized to sign bonds before
the Bonds bearing his or her facsimile signature are authenticated
or delivered by the Bond Registrar or issued by the City, those
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Bonds nevertheless may be authenticated, delivered and issued and,
when authenticated, delivered and issued, shall be as binding on
the City as though that person had continued to be an officer of
the City authorized to sign bonds. Any Bond also may be signed on
behalf of the City by any person who, on the actual date of signing
of the Bond, is an officer of the City authorized to sign bonds,
although he or she did not hold the required office on the date of
issuance of the Bonds.
Section 12. Bond Registrar. The Bond Registrar shall keep,
or cause to be kept, at its principal corporate trust office,
sufficient books for the registration and transfer of the Bonds,
which shall be open to inspection by the City at all times. The
Bond Registrar is authorized, on behalf of the City, to
authenticate and deliver Bonds transferred or exchanged in
accordance with the provisions of the Bonds and this ordinance, to
serve as the City's paying agent for the Bonds and to carry out all
of the Bond Registrar's powers and duties under this ordinance and
City Ordinance No. 2418 establishing a system of registration for
the City's bonds and obligations.
The Bond Registrar shall be responsible for its
representations contained in the Bond Registrar's Certificate of
Authentication on the Bonds. The Bond Registrar may become the
owner of Bonds 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 members of, or in any other capacity with respect to, any
committee formed to protect the rights of Bond owners.
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Section 13. Preservation of Tax Exemption for Interest on
Bonds. The City covenants that it will take all actions necessary
to prevent interest on the Bonds from being included in gross
income for federal income tax purposes, and it will neither take
any action nor make or permit any use of proceeds of the Bonds or
other funds of the City treated as proceeds of the Bonds at any
time during the term of the Bonds which will cause interest on the
Bonds to be included in gross income for federal income tax
purposes. The City also covenants that it will, to the extent the
arbitrage rebate requirement of Section 148 of the Code, is
applicable to the Bonds, take all actions necessary to comply (or
to be treated as having complied) with that requirement in
connection with the Bonds, including the calculation and payment of
any penalties that the City has elected to pay as an alternative to
calculating rebatable arbitrage, and the payment of any other
penalties if required under Section 148 of the Code to prevent
interest on the Bonds from being included in gross income for
federal income tax purposes. The City certifies that it has not
been notified of any listing or proposed listing by the Internal
Revenue Service to the effect that it is a bond issuer whose
arbitrage certifications may not be relied upon.
Section 14. Refunding of the 1988 Bonds.
(a) Appointment of Refunding Trustee. West One Bank Idaho of
Boise, Idaho, is appointed Refunding Trustee.
(b) Use of Bond Proceeds; Acquisition and Substitution of
Acquired Obligations. A sufficient amount of the proceeds of the
sale of the Bonds shall be deposited immediately upon the receipt
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thereof with the Refunding Trustee and used, together with money on
deposit in the 1988 Bond Fund to be deposited with the Refunding
Trustee, to discharge the obligations of the City relating to the
1988 Bonds under Ordinance No. 2790 by providing for the payment of
the amounts required to be paid by the Refunding Plan. To the
extent practicable, such obligations shall be discharged fully by
the Refunding Trustee's simultaneous purchase of the Acquired
Obligations, bearing such interest and maturing as to principal and
interest in such amounts and at such times so as to provide,
together with a beginning cash balance, if necessary, for the
payment of the amount required to be paid by the Refunding Plan.
The Acquired Obligations are listed and more particularly described
in Schedule A attached to the Refunding Trust Agreement between the
City and the Refunding Trustee, but are subject to substitution as
set forth below. Any Bond proceeds deposited with the Refunding
Trustee that are not needed to purchase the Acquired Obligations
and provide a beginning cash balance, if any, and pay the costs of
issuance of the Bonds shall be returned to the City at the time of
delivery of the Bonds for deposit in the Project Fund to pay costs
of the Project.
Prior to the purchase of any such Acquired Obligations, the
City reserves the right to substitute other Government Obligations
for any of the Acquired Obligations and to use any savings created
thereby for any lawful City purpose if, (a) in the opinion of
Foster Pepper & Shefelman, the City's bond counsel, the interest on
the Bonds and the 1988 Bonds will remain excluded from gross income
for federal income tax purposes under Sections 103, 148 and 149(d)
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of the Code, and (b) such substitution shall not impair the timely
payment of the amounts required to be paid by the Refunding Plan,
as verified by a nationally recognized firm of independent
certified public accountants.
After the purchase of the Acquired Obligations by the
Refunding Trustee, the City reserves the right to substitute
therefor cash or Government Obligations subject to the conditions
that such money or securities held by the Refunding Trustee shall
be sufficient to carry out the Refunding Plan, that such
substitution will not cause the Bonds and the 1988 Bonds to be
arbitrage bonds within the meaning of Section 148 of the Code and
regulations thereunder in effect on the date of such substitution
and applicable to obligations issued on the issue date of the
Bonds, and that it obtain, at its expense: (1) verification by a
nationally recognized independent certified public accounting firm
acceptable to the Refunding Trustee confirming that the payments of
principal of and interest on the Government Obligations, if paid
when due, and any other money held by the Refunding Trustee will be
sufficient to carry out the Refunding Plan; and (2) an opinion from
Foster Pepper & Shefelman, bond counsel to the City, its successor,
or other nationally recognized bond counsel to the City, to the
effect that the disposition and substitution or purchase of such
securities, under the statutes, rules and regulations then in force
and applicable to the Bonds, will not cause the interest on the
Bonds or the 1988 Bonds to be included in gross income for federal
income tax purposes and that such disposition and substitution or
purchase is in compliance with the statutes and regulations
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applicable to the Bonds. Any surplus money resulting from the
sale, transfer, other disposition or redemption of the Acquired
Obligations and the substitutions therefor shall be released from
the trust estate and transferred to the City to be used for any
lawful City purpose.
(c) Administration of Refunding Plan. The Refunding Trustee
is authorized and directed to purchase the Acquired Obligations (or
substitute obligations) and to make the payments required to be
made by the Refunding Plan from the Acquired Obligations (or
substitute obligations) and money deposited with the Refunding
Trustee pursuant to this ordinance. All Acquired Obligations (or
substitute obligations) and the money deposited with the Refunding
Trustee and any income therefrom shall be held irrevocably,
invested and applied in accordance with the provisions of Ordinance
No. 2790, this ordinance, chapter 39.53 RCW and other applicable
statutes of the State of Washington and the Refunding Trust
Agreement. All necessary and proper fees, compensation and
expenses of the Refunding Trustee for the Bonds and all other costs
incidental to the setting up of the escrow to accomplish the
refunding of the 1988 Bonds and costs related to the issuance and
delivery of the Bonds, including bond printing, verification fees,
bond counsel's fees and other related expenses, shall be paid out
of the proceeds of the Bonds.
(d) Authorization for Refunding Trust Agreement. To carry
out the Refunding Plan provided for by this ordinance, the Mayor or
Finance Director of the City is authorized and directed to execute
and deliver to the Refunding Trustee a Refunding Trust Agreement
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substantially in the form on file with the City Clerk and by this
reference made a part hereof setting forth the duties, obligations
and responsibilities of the Refunding Trustee in connection with
the payment, redemption and retirement of the 1988 Bonds as
provided herein and stating that the provisions for payment of the
fees, compensation and expenses of such Refunding Trustee set forth
therein are satisfactory to it. Prior to executing the Refunding
Trust Agreement, the Mayor or Finance Director of the City is
authorized to make such changes therein which do not change the
substance and purpose thereof or which assure that the escrow
provided therein and the Bonds are in compliance with the
requirements of federal law governing the exclusion of interest on
the Bonds from gross income for federal income tax purposes.
Section 15. Call for Redemption of the 1988 Bonds. The City
calls for redemption on December 1, 1998, all then -outstanding 1988
Bonds at a price of 102% of par plus accrued interest. Such call
for redemption shall be irrevocable after the delivery of the Bonds
to the initial purchaser thereof. The date on which the 1988 Bonds
are called for redemption is the earliest date on which the those
bonds may be called for redemption.
The proper officials of the City are authorized and directed
to give or cause to be given such notices as required, at the times
and in the manner required pursuant to Ordinance No. 2790 in order
to effect the redemption prior to their maturity of the 1988 Bonds.
Section 16. City Findings with Respect to Refunding. The
City Council finds and determines that the issuance and sale of the
Bonds allocable to the financing of the Refunding Plan at this time
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will effect a savings to the City and is in the best interest of
the City and in the public interest. In making such finding and
determination, the City Council has given consideration to the
fixed maturities of the Bonds and the 1988 Bonds, the costs of
issuance of the Bonds allocable to the financing of the Refunding
Plan and the known earned income from the investment of the
proceeds of the issuance and sale of the Bonds and other money of
the City used in the Refunding Plan pending payment and redemption
of the 1988 Bonds.
The City Council further finds and determines that the money
to be deposited with the Refunding Trustee for the Refunded Bonds
in accordance with Section 14 of this ordinance will discharge and
satisfy the obligations of the City under Ordinance No. 2790 with
respect to the 1988 Bonds, and the pledges, charges, trusts,
covenants and agreements of the City therein made or provided for
as to the 1988 Bonds, and that the 1988 Bonds shall no longer be
deemed to be outstanding under such ordinance immediately upon the
deposit of such money with the Refunding Trustee.
Section 17. Transfer of City Funds. The Finance Director is
authorized to transfer all money on deposit in the 1988 Bond Fund
to the Refunding Trustee as necessary to carry out the Refunding
Plan.
Section 18. Bonds Negotiable. The Bonds shall be negotiable
instruments to the extent provided by RCW 62A.8-102 and 62A.8-105.
Section 19. Refunding or Defeasance of the Bonds. The City
may issue refunding bonds pursuant to the laws of the State of
Washington or use money available from any other lawful source to
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pay when due the principal of and interest on the Bonds, or any
portion thereof included in a refunding or defeasance plan, and to
redeem and retire, refund or defease all such then -outstanding
Bonds (hereinafter collectively called the "defeased Bonds") and to
pay the costs of the refunding or defeasance. If money and/or
Government Obligations maturing at a time or times and bearing
interest in amounts (together with money, if necessary) sufficient
to redeem and retire, refund or defease the defeased Bonds in
accordance with their terms are set aside in a special trust fund
or escrow account irrevocably pledged to that redemption,
retirement or defeasance of defeased Bonds (hereinafter called the
"trust account"), then all right and interest of the owners of the
defeased Bonds in the covenants of this ordinance and in the funds
and accounts obligated to the payment of the defeased Bonds shall
cease and become void. The owners of defeased Bonds shall have the
right to receive payment of the principal of and interest on the
defeased Bonds from the trust account. The City shall include in
the refunding or defeasance plan such provisions as the City deems
necessary for the random selection of any defeased Bonds that
constitute less than all of a particular maturity of the Bonds, for
notice of the defeasance to be given to the owners of the defeased
Bonds and to such other persons as the City shall determine, and
for any required replacement of Bond certificates for defeased
Bonds. The defeased Bonds shall be deemed no longer outstanding,
and the City may apply any money in any other fund or account
established for the payment or redemption of the defeased Bonds to
any lawful purposes as it shall determine.
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If the principal of and/or interest due on the Bonds is paid
by the Bond Insurer pursuant to the Municipal Bond Insurance
Policy, the Bonds shall not be considered paid by the City, and the
covenants, agreements and other obligations of the City to the
registered owners of the Bonds shall continue to exist and the Bond
Insurer shall be subrogated to the rights of the registered owners.
Section 20. Bond Fund; Project Fund• and Deposit of Bond
Proceeds. There is created and established in the office of the
Finance Director a special fund designated as the Limited Tax
General Obligation and Refunding Bond Fund, 1995 (the "Bond Fund") .
Accrued interest on the Bonds, if any, received from the sale and
delivery of the Bonds shall be paid into the Bond Fund. All taxes
collected for and allocated to the payment of the principal of and
interest on the Bonds (together with such revenues from the Golf
Complex as the City may allocate to pay the Bonds) shall be
deposited in the Bond Fund.
There also is created and established in the office of the
Finance Director a special fund designated as the Golf Complex
Project Fund, 1995 (the "Project Fund"). The principal proceeds
received from the issuance and sale of the Bonds remaining after
the deposits required by Section 14 shall be deposited in the
Project Fund and shall be used to pay the costs of carrying out the
Project. Until needed to pay those costs, the City may invest
principal proceeds temporarily in any legal investment, and the
investment earnings may be retained in the Project Fund and be
spent for the purposes of that fund except that earnings subject to
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a federal tax or rebate requirement may be withdrawn from the
Project Fund and used for those tax or rebate purposes.
Section 21. Approval of Bond Purchase Contract. Lehman
Brothers Inc. of Seattle, Washington, has presented a purchase
contract (the "Bond Purchase Contract") to the City offering to
purchase the Bonds under the terms and conditions provided in the
Bond Purchase Contract, which written Bond Purchase Contract is on
file with the City Clerk and is incorporated herein by this
reference. The City Council finds that entering into the Bond
Purchase Contract is in the City's best interest and therefore
accepts the offer contained therein and authorizes its execution by
City officials.
The Bonds will be printed at City expense and will be
delivered to the purchaser in accordance with the Bond Purchase
Contract, with the approving legal opinion of Foster Pepper &
Shefelman, municipal bond counsel of Seattle, Washington, regarding
the Bonds printed on each Bond. Bond counsel shall not be required
to review and shall express no opinion concerning the completeness
or accuracy of any official statement, offering circular or other
sales material issued or used in connection with the Bonds, and
bond counsel's opinion shall so state.
The proper City officials are authorized and directed to do
everything necessary for the prompt delivery of the Bonds to the
purchaser and for the proper application and use of the proceeds of
the sale thereof.
Section 22. Preliminary Official Statement Deemed Final. The
City Council has been provided with copies of a preliminary
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official statement dated January 10, 1995 (the "Preliminary
Official Statement"), prepared in connection with the sale of the
Bonds. For the sole purpose of the Bond purchaser's compliance
with Securities and Exchange Commission Rule 15c2 -12(b)(1), the
City "deems final" that Preliminary Official Statement as of its
date, except for the omission of information as to offering prices,
interest rates, selling compensation, aggregate principal amount,
principal amount per maturity, maturity dates, options of
redemption, delivery dates, ratings and other terms of the Bonds
dependent on such matters.
Section 23. Bond Insurance. The City is authorized to
purchase from the Bond Insurer the Municipal Bond Insurance Policy
insuring the prompt payment of the principal of and interest the
Bonds and agrees to the conditions for obtaining that policy,
including the payment of the premium therefor.
Section 24. Temporary Bond. Pending the printing, execution
and delivery to the purchaser of definitive Bonds, the City may
cause to be executed and delivered to the purchaser a single
temporary Bond in the total principal amount of the Bonds. The
temporary Bond shall bear the same date of issuance, interest
rates, principal payment dates and terms and covenants as the
definitive Bonds, shall be issued as a fully registered Bond in the
name of the purchaser, and otherwise shall be in a form acceptable
to the purchaser. The temporary Bond shall be exchanged for
definitive Bonds as soon as they are printed, executed and
available for delivery.
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Section 25. Effective Date of Ordinance. This ordinance
shall take effect and be in force from and after its passage and
five (5) days following its publicatic
By
ATTEST:
Passed the 117 day of , 1995.
Approved the /8 day of 1995.
Published the da dj44 1995.
' V /
I certify that this is a true copy of Ordinance No. 3aoy
passed by the City Council of the City of Kent, Washington, and
approved by the Mayor of the City of Kent as hereon indicated.
(SEAL)
Brenda Jac be , City Clerk
0161487.04
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Q�
BRENDA JACOB ,
ity Clerk
APPROVED AS TO FORM:
Special Counsel
and Bond
Counsel for the
City
Passed the 117 day of , 1995.
Approved the /8 day of 1995.
Published the da dj44 1995.
' V /
I certify that this is a true copy of Ordinance No. 3aoy
passed by the City Council of the City of Kent, Washington, and
approved by the Mayor of the City of Kent as hereon indicated.
(SEAL)
Brenda Jac be , City Clerk
0161487.04
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