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HomeMy WebLinkAboutResolution 107-92 RESOLUTION NO. 107-92 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ATASCADERO, CALIFORNIA, PROVIDING FOR THE ISSUANCE OF 1992-93 TAX AND REVENUE ANTICIPATION NOTES WHEREAS, in accordance with Article 7.6 of Chapter 4, Part 1, Division 2, Title 5 of the Government Code of the State of California (the Code) , entitled "Temporary Borrowing, " the City Council of the City of Atascadero California (the "City Council") , intends to issue 1992-93 Tax and Revenue Anticipation Notes (the "Notes") of the City of Atascadero, California (the "City") , in an aggregate principal. amount of not to exceed $3, 000,000; and WHEREAS, the City Council hereby finds and determines that the City needs to borrow funds in an amount not to exceed $3,000,000 in fiscal year 1992-93 for authorized purposes of the City and the City Council intends to authorize for that purpose the issuance of, and offer for sale, tax and revenue anticipation notes of the City in an aggregate principal amount of not to exceed $3,000,000 (the "Notes") pursuant to the cited provisions of the Code to be applied for any purposes for which the City is authorized to expend moneys; and WHEREAS, the Notes may bear interest not exceeding twelve percent (12%) per annum, as permitted by Section 53531 of- the Code, notwithstanding Section 53584 of' the Code; and WHEREAS, the Notes will not be outstanding after the period ending 13 months from the date on which the Notes are issued and will not be issued in an amount greater than the maximum anticipated cumulative cash flow deficit of the City to be financed by the anticipated tax or other revenue sources for which such taxes or other revenues are anticipated and during which such Notes are outstanding, all as provided. in Treasury Regulation 1.103-14(c) under the Internal Revenue Code of 1954, as amended (together with the Internal Revenue Code of 1986, as- amended, the "Tax Code") ; and WHEREAS, the City hereby designates its City Treasurer (the "Treasurer") to serve, as fiscal agent, paying agent and as agent for the City in matters, reiating to the Pledged Revenues (defined below) ; and WHEREAS, Bank of America, NT&SA (the "Underwriter") has submitted to the City an offer to purchase all of said i Resolution No. 107-92 Page 2 Notes at a discount to be established prior to execution of a Contract of Purchase (the "Contract of Purchase") , and the City Council desires to have the Underwriter purchase the Notes on the terms to be stated therein; NOW, THEREFORE, the City Council of the City of Atascadero hereby resolves as follows: Section 1. Authorization of Issuance of Notes; Terms Thereof. Subject to the conditions set forth in Section 6 below, the City Council hereby determines to and shall issue an aggregate principal amount of not to exceed $3, 000,000 of its 1992-93 Tax and Revenue Anticipation Notes (the "Notes") ; to be numbered from 1 consecutively upwards in order of issuance; to be in the denominations of $5,000 or any integral multiple thereof, as directed by the Underwriter; to be dated the date of delivery thereof; to mature (without option of prior redemption) on the date and in the amounts stated in the Notes, such maturity date to be no more than 364 days from the date of delivery thereof nor more than 13 months after the date on which the Notes are issued; and to bear interest, payable at maturity and computed on a 30-day month/360-day year basis, at the rate determined at the time of sale thereof to the Underwriter, but not in excess of twelve percent (12%) per annum. Both the principal of and the interest on the Notes shall be payable, but only upon surrender thereof, in lawful money of the United States of America in accordance with the provisions of Section 2 hereof. Section 2. Form of Notes. The Notes will be delivered in book-entry-only form by appointing the Depository Trust Company ("DTC") , 55 Water Street, 19th Floor, New York, New York 10041, to act as securities depository for the Notes. A single Note substantially in the form of Exhibit A hereto, representing all of the outstanding Notes, will be executed and, on the day prior to closing, delivered to DTC. There shall be printed on the reverse of or attached to each Note the legal opinion of Buchalter, Nemer, Fields & Younger respecting the validity of the Notes and exclusion of the interest thereon from gross income for federal income tax purposes and the exemption of such interest from State of California personal income taxes. Upon closing, the City shall notify DTC at which time DTC (in accordance with the Letter of Representations defined below) will credit the account of the Underwriter, and process, the book-entry deliveries. to the accounts of the subsequent purchasers of interests- in the Notes. The single Note will be lodged with DTC until maturity of the Notes. On the date of maturity of the Notes, the- Treasurer shall remit to DTC sufficient funds to pay all outstanding principal and interest due with respect to the Notes. Resolution No. 107-92 Page 3 The City Manager and the Treasurer are hereby instructed to take all action necessary in order to qualify the Notes with DTC for book-entry-only issuance, including entering into a Letter of Representations with DTC (the "Letter of Representations") setting forth the terms and conditions of, and procedures for the book-entry-only form of issuance and, with the assistance of the Underwriter, the completion of and delivery to DTC's Underwriting Department of the requisite Eligibility Questionnaire in the form required by DTC not later than ten (10) business days prior to closing. DTC shall act as clearing agent with respect to the payment of principal and interest on the Notes to the subsequent purchasers thereof. Section 3. Deposit of Note Proceeds. The moneys representing the proceeds of sale of the Notes shall be deposited into the City's general fund. Following such deposit, said proceeds shall be withdrawn and expended by the City for any lawful purpose for which the City is authorized to expend moneys, including, but not limited to, current expenses, capital expenditures and the discharge of any obligation of indebtedness of the City. Section 4. Payment of Notes. (A) Source of Payment. The principal amount of the Notes, together with the interest thereon, shall be payable from taxes, income, revenue, cash receipts and other moneys which are received by the City during fiscal year 1992-93 and which are available- therefor. Pursuant to Section 53857 of the Code, the Notes shall be the general obligations of the City, and to the extent the Notes are not paid from the Pledged Revenuer identified below, the Notes shall be paid with interest thereon from any other moneys of the City lawfully available therefor, as provided in this Resolution of the City Council and otherwise by law. (B) Pledged Revenues. As security for the payment of principal of and interest on the Notes, by this Resolution, the City hereby pledges an amount equal to fifty percent (50%) of the principal amount of the Notes from the first unrestricted revenues received by the City during the month ending April 30, 1993; an amount equal to thirty percent (30%) of the principal amount of the Notes from the first unrestricted revenues received by the City during the month ending May 31, 1993; and an amount equal to twenty percent (20%) of the principal amount of the Notes, plus an amount sufficient to pay interest on the- Notes, from the first unre- stricted revenues received by the City in the month ending June 30, 1993 (the "Pledged Revenues") . The. term Resolution No. 107-92 Page 4 "unrestricted revenues" shall mean taxes, income, revenue, cash receipts and other moneys of the City, as provided in Section 53856 of the Code, which are intended as receipts for the general fund of the City and which are generally available for the payment of current expenses and other obligations of the City. There is hereby established and created the special fund designated in paragraph (C) below, to be maintained by the Treasurer in the name and on behalf of the City, into which the Treasurer shall promptly deposit all Pledged Revenues of the City when and as received, without further permission of or instruction by the City Council. From the dates of receipt by the Treasurer of any Pledged Revenues, the City shall have no right, title or interest therein, and the Treasurer shall have the sole right of withdrawal from the Repayment Fund hereinafter established for the purposes described in this Resolution. The principal of the Notes and the interest thereon shall be a first lien and charge against and shall be payable from the first moneys received by the City constituting such Pledged Revenues, as provided by law. In the event there are insufficient unrestricted revenues received by the City to permit the deposit into the Repayment Fund (as hereinafter defined) of the City of the full amount of Pledged Revenues required hereunder to be deposited from unrestricted revenues in a given month, then the amount of any deficiency shall be satisfied and made up from the first additional moneys of the City received and lawfully available for the repayment of the Notes and the interest thereon. (C) Deposit of Pledged RRavenues in Repayment Fund. The Pledged Revenues for the City shall be held by the Treasurer in a special fund designated as the "City of Atascadero, California, 1992-93 Tax and Revenue Anticipation Notes Repayment Fund" (herein called the "Repayment Fund") , and applied as directed in this Resolution. Moneys: placed in the Repayment Fund shall be for the sole benefit of the holders of the Notes, and until the Notes and all interest thereon are paid in full or until provision has been made for the payment of the Notes at maturity with interest to such date, the moneys in the Repayment Fund shall be applied only for the purposes for which the Repayment Fund was created. (D)- Disbursement and Investment of MQ2Ys in- Repayment nRRepayment Fund. From the date this Resolution takes effect, all Pledged Revenues shall, when received, be deposited into the Repayment. Fund. After such date as the amount of the Pledged Revenues deposited in the Repayment Fund shall be sufficient to pay in full the- principal of and interest on the Resolution No. 107-92 Page 5 Notes, when due, any moneys in excess of such amount remaining in or accruing to the Repayment Fund shall be transferred to the general fund of the City. On the maturity date of the Notes, moneys on deposit in the Repayment Fund shall be used, to the extent necessary, to pay the principal of and interest on the Notes. Moneys in the Repayment Fund, to the greatest extent possible, shall be invested in investment securities by the Treasurer, as permitted by applicable California law, as now in effect and as it may be amended, modified or supplemented from time to time. Section 5. - xecution of Notes. The Treasurer is directed to cause to be lithographed, printed or engraved a sufficient number of blank Notes of suitable quality, showing on their face the interest rate(s) applicable thereto. The Treasurer, or any designated deputy thereof, is hereby authorized to sign the Notes manually, and the City Manager is hereby authorized to sign the Notes manually or by facsimile signature and the City Clerk is hereby authorized to countersign the Note manually or by use of his or her facsimile signature and said City Clerk is hereby authorized to affix the seal of the City thereto by facsimile impression thereof, and said officers are hereby authorized to cause the blank spaces on the form of Notes to be filled in prior to initial delivery as may be appropriate. Section 6. Approval of Coact of Purchase. The City Manager is hereby authorized to execute and deliver a Contract of Purchase, in the form to be delivered by the Underwriter on such terms as the City Manager may approve, such approval to be conclusively evidenced by his execution and delivery thereof; provided, however, that the maximum effective interest rate on the Notes shall not exceed four percent (4%) per annum and the discount which the City Manager may approve: shall not exceed two percent (2%) of the par amount of the Notes. The City Manager is further authorized to determine the maximum principal amount of Notes to be specified in the Contract of Purchase for sale by the City, not to exceed $3,00O,000, and to enter into and execute the Contract of Purchase with the Underwriter, if the conditions set forth in this Resolution are satisfied. Section 7. Delivery of Notes. The City Manager is hereby authorized and directed to deliver the Notes to Underwriter upon payment therefor in accordance with the Contract of Purchase. All actions heretofore taken with respect to the sale and issuance of the Notes are hereby approved, confirmed -and ratified, and the City Manager is hereby authorized and directed, for and in the name and on Resolution No. 107-92 Page 6 behalf of the City, to do any and all things and take any and all actions and execute and deliver any and all certificates, agreements and other documents, including but not limited to those described in the Contract of Purchase, which may be deemed necessary or advisable in order to consummate the lawful issuance and delivery of the Notes in accordance with this Resolution. Section S. Bond Counsel. The law firm of Buchalter, Nemer, Fields & Younger, a Professional Corporation, Los Angeles, California, is hereby appointed as Bond Counsel for the issuance of the Notes. Section 9. Approval of Preliminary official Statement and Official Statement. The Underwriter is hereby authorized to prepare a Preliminary and a Final Official Statement to be used in connection with the offering and sale of the Notes and the City Manager is hereby authorized to approve the Official Statement, such approval to be conclusively evidenced by his execution thereof for and on behalf of the City. Section 10. Rebate Exception. The City intends to qualify under the "small governmental unit" exception of Section 148(f) (4) (C) of the Tax Code to be exempt from the rebate requirements of Section 148 (f) (2) of the Tax Code, and, therefore, the aggregate face amount of all tax-exempt obligations (other than private activity bonds) issued by the City (and all subordinate entities thereof) during the 1992 calendar year, which is the calendar year in which the Notes are issued, is not reasonably expected to exceed $5,000,000. Section 11. Bank Oualification. The City Council specifically finds, determines and declares that the Notes are designated to be "qualified tax-exempt obligations* for purposes of Section 165(b) (3) of the Tax Code. In connection with this designation, the City Council hereby represents that it intends to issue less than $10,000,000 in tax-exempt obligations for calendar year 1992, including the Notes. Resolution No. 107-92 Page 7 Section 12. This Resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting this resolution. On motion by Councilperson Kudlac and seconded by Councilperson Luna , the foregoing Resolution is hereby adopted in its entirety on the following roll call vote: AYES: Councilmembers Bewley,- Kudlac, Luna and Mayor Nimmo NOES: None ABSENT: Councilmember Borgeson ADOPTED: October 27, 1992 ATTEST: CITY OF ATASCADERO By:-A LEE RABOIN-, Cary Clerk ROBERT P. NIMMO, Mayor APPROVED AS TO FORM: AR ER R. MOT ON, City Attorney RESOLUTION No. 107-92 EXHIBIT "A.. Page 1 EXHIBIT A CITY OF ATASCADERO COUNTY OF SAN LUIS OBISPO STATE OF CALIFORNIA 1992-93 TAX AND REVENUE ANTICIPATION NOTE Dated Date: Maturity Date: November _, 1992 November —, 1992 Principal Amount: CUSIP: FOR VALUE RECEIVED, the City of Atascadero, San Luis Obispo County, California ("City") , acknowledges itself indebted to and promises to pay to CEDE & CO. , or registered assigns, at the office of the Treasurer of the City the principal sum of DOLLARS ($ ) , in lawful money of the United States of America, on November 1993, together with interest thereon at the rate of percent ( %) per annum computed on a 30-day month/360-day year basis, in lawful money of the United States of America from the date hereof until payment in full of said principal sum. Both the principal of and interest on this note shall be payable only upon surrender of this note at the office of the Treasurer of the City as the note shall fall due; provided, however, that no interest shall be payable for any period after maturity during which the holder hereof fails properly to present this note for payment. It is hereby certified, recited and declared that this is one of an authorized issue of notes in the aggregate principal amount of dollars ($_r_) , all of like date, tenor and effect, made, executed and given pursuant to and by authority of a resolution duly passed and adopted on October 27, 1992, by the City Council of the City of Atascadero, under and by authority of Article 7.6 (commencing with Section 53850) of Chapter 4, Part 1, Division 2, Title 5, California Government Code, and that all acts, conditons. and things required to exist, happen and be performed precedent to and in the issuance of this note have existed, happened and been performed in regular and due time, form and manner as required by law, and that this note, together with all other indebtedness and obligations of the City, does not exceed any limit prescribed by the Constitution or laws of the State of California. The principal amount of the notes, together with the interest thereon, shall be payable-, from taxes, income, RESOLUTION NO. 107-92 EXHIBIT "A" Page 2 revenue, cash receipts and other moneys which are received by the City during fiscal year 1992-93. As security for the payment of the principal of and interest on the notes, the City has pledged an amount equal to fifty percent (50%) of the principal amount of the Notes from the first unrestricted revenues received by the City in the month ending April 30, 1993; an amount equal to thirty percent (30%) of the principal amount of the notes from the first unrestricted revenues received by the City in the month ending May 31, 1993; and an amount equal to twenty percent (20%) of the principal amount of the notes plus an amount sufficient to pay interest on the notes, from the first unrestricted revenues of the City to be . received in the month ending June 30, 1993 (such pledged amounts being hereinafter called the "Pledged Revenues") , and the principal of the notes and the interest thereon shall be payable from the Pledged Revenues, and to the extent not so paid shall be paid from any other moneys of the city lawfully available therefor. Unless this note is presented by an authorized representative of DTC to the City or its agent for registration of transfer, exchange or payment, any Note issued will be registered in the name of Cede & Co. or such other name as requested by an authorized representative of DTC and any payment is made to Cede & Co. , ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE. & CO. , HAS AN INTEREST HEREIN. IN WITNESS WHEREOF, the City Manager and the City Treasurer of the City of Atascadero, California, have executed this Note and have caused it to be countersigned by RESOLUTION NO.107-92 EXHIBIT "A" Page 3 the City Clerk, which signatures may be facsimile signatures, except that one of such signatures shall be manual and have caused a facsimile of its official seal to be printed hereon as of this day of November, 1992. By C1 Manager SZ� L1� Y01911 City Treasurer �ZSZS [S t Counersigned: By City Clerk