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HomeMy WebLinkAbout3041 OrdinanceCITY OF PASCO, WASHINGTON ORDINANCE NO. AN ORDINANCE of the City of Pasco, Washington, relating to the defeasance of an outstanding lease/purchase agreement and certificates of participation therein, authorizing the execution and delivery of a Defeasance Trust Agreement and the exercise of an option to purchase the property pursuant to the lease/purchase agreement. WHEREAS, the City of Pasco, Washington (the "City"), by Ordinance No. 2766 passed by the City Council and approved by the Mayor on January 16, 1990, approved and authorized the proper officials of the City to execute and deliver a Lease/Purchase Agreement (the "Lease/Purchase Agreement") dated as of January 26, 1990, by and between Glacier Park Company as Lessor and the City as Lessee, pursuant to which the City leased from the Lessor, with an option to purchase, certain property (the "Property"), consisting of certain parcels of irrigated land, together with water rights, wells, easements and associated fixtures and equipment constituting the irrigation system located on the land, expected to be used on a future date as an industrial wastewater treatment facility and to comprise part of the City's Waterworks Utility, including the system of sewerage as a part thereof; and WHEREAS, pursuant to Section 3 of Ordinance No. 2766 the City pledged the full faith, credit and resources of the City for the payment of rentals payable under the Lease/Purchase Agreement, and pledged to budget and appropriate from annual taxes and other revenues available to the City without a vote of the electors of the City amounts sufficient, together with other money legally 144291 1 available therefor, to pay all rentals payable under the Lease/Purchase Agreement when due; and WHEREAS, the Lessor's interest in the Lease/Purchase Agreement was assigned by Glacier Park Company to Seattle-First National Bank as Escrow Agent (the "Escrow Agent") under that certain Escrow Agreement (the "Escrow Agreement") dated as of January 26, 1990, by and between U.S. Bank of Washington, National Association (the "Bank"), and the Escrow Agent; and WHEREAS, with the approval of the City, the Bank executed, sold and delivered to investors certain certificates of participation (the "Certificates") evidencing and representing undivided proportionate ownership interests in and to the City's obligation under the Lease/Purchase Agreement to make rental payments and, if the City exercises its option to purchase the Property, to pay the purchase price of the Property; and WHEREAS, pursuant to Section 9.1 of the Lease/Purchase Agreement, the City has the right on any rental payment date (each January 1 and July 1) on or after January 1, 1992, to purchase the Property from the Lessor for a purchase price specified in Attachment C to the Lease/Purchase Agreement, which purchase price on January 1, 1995, will be $1,997,450; and WHEREAS, pursuant to Section 11 of the Escrow Agreement and provisions of the Certificates, the obligations of the City under the Lease/Purchase Agreement as evidenced and represented by the Certificates may be defeased by depositing in trust with a trustee government obligations as defined in Chapter 39.53 RCW ("Government 144291 1 2 Obligations") and cash, if required, in an amount that in the opinion of an independent certified public accountant will be fully sufficient to pay and discharge the principal of and interest on all outstanding Certificates on or before their respective principal payment dates; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON, DO ORDAIN as follows: Section 1. Approval of Defeasance Plan. The City Council finds it to be in the best interest of the City to exercise the option of the City under the Lease/Purchase Agreement to purchase the Property on January 1, 190i, and to provide for the defeasance of the obligations of the City under the Lease/Purchase Agreement as evidenced and represented by the Certificates by depositing in trust with Seattle-First National Bank, as trustee, Government Obligations and cash, if required, in an amount that in the opinion of an independent certified public accountant will be fully sufficient to pay and discharge the principal of and interest on all outstanding Certificates on January 1, 1995 (the "Defeasance Plan"). Section 2. Approval and Authorization of Defeasance Trust Agreement. The form of Defeasance Trust Agreement by and between the City and Seattle-First National Bank presented to and on file with the City Council is approved, and the Mayor and City Clerk are authorized and directed to execute and deliver the Defeasance Trust Agreement in substantially such form. The Mayor, City Clerk and other officials of the City are further authorized to execute and 144291 1 3 ATT """ ity Clerk, APP. 1 kj 1 11. V A ey OR .A_A vw 4 deliver all other documents and take such actions as are reasonable and necessary to carry out the Defeasance Plan. Section 3. Transfer of Funds. The Director of Finance/Budget of the City is authorized to transfer $1,997,450 from the General Fund of the City to Seattle-First National Bank, as trustee, to be applied pursuant to the Defeasance Trust Agreement to purchase the Government Obligations specified on Schedule A to the Defeasance Trust Agreement and provide a beginning cash balance, as required to carry out the Defeasance Plan. Any funds transferred to the City pursuant to the Defeasance Trust Agreement after the Defeasance Plan is fully carried out shall be deposited in the General Fund of the City. Section 4. Ratification. All actions heretofore taken by any official of the City to carry out the Defeasance Plan consistent with the provisions of this ordinance are ratified and confirmed. PASSED by the City Council of the City of Pasco, Washington, at a regular open public meeting thereof this 15th day of August, 1994, and signed in authentication of its passage this 15 -day of August, 1994. CITY OF PASCO WASHINGTON PUBLISHED: A tA . a\ VNIA 1101110 1 1 1111111111111111 11110010 FINANCE DEPARTMEN1 (509) 545-3401 / Scln 726-3401 / Fax (509) 545-3403 P0 BOX 29, 412 WFST CLARK, PASCO, WASI IINGION 99301 August 17, 1994 Tn-City Herald P0 Box 2608 Pasco, Wa 99302 Dear Kathy Please publish the attached Ordinance(s) No 3039, 3041, 3043, 3044 and 3045 on the following date August 21, 1994 Please send two (2) Affidavits of Publication for each Thank you, Cathenne D Seaman Deputy City Clerk 545-3402 cds * No attachments or maps included , Notary Liblic in and for the State of Wash- ington, residing at F ASCO WA COMMISSION EXPIRES 2- AS-- -4\ ktt IN\3)' P 0 BOX 2608 PASCO WASHINGTON 99302 2608 PHONE (509) 582 1500 &MAI ADVEG270000 INVOICE SOLD TO FASCO, CITY OF LEGALS F.O. BOX 23: F ASCO WA 937.01 DATE 03/ 21 / 34 LEGAL NO #1501 ACCOUNT NO 50550 DESCRIPTION 1 '901 ORDINANCE NO . :041 A TIMES 001 INCHES 20 .E 0 TOM& 220.51 R1OTOCIE This is an invoice for legal advertising space Please pay from this invoice as no statement will be rendered Please detach at perforation and return with payment AFFilDLYN OF PUDE,IICALifill00 COUNTY OF BENTON SS STATE OF WASHINGTON ,R1 gigunini AUG 2 9 1994 L‘::'-) ONA CE DEPT CARLA ALFORD , being duly sworn, deposes and says, I am the Legal Clerk of the Tr-City Herald, a daily newspaper That said newspaper is a legal newspaper and has been approved as a legal newspaper by order of the superior court in the county in which it is published and it is now and has been for more than six months prior to the date of the publication hereinafter referred to, published countinually as a daily newspa- per in Benton County, Washington That the attached is a true copy of a 1501 ORD I NANCE NO . 7041 A as it was printed in the regular and entire issue of the Tr-City Herald itself and not in a supplement thereof, 1 time(s), commencing on 03/21/ :44 , and ending on 03/21/94 , and that said newspaper was regulary distributed to its subscribers during all of this period SUBSCRIBED AND SWORN BEFORE ME THIS DAY OF 47w.r2' M11-1- LEGALS • ORDINANCE NO 3041 AN ORDINANCE of the City of Pasco Washington relating to the defeasance of an outstanding lease/ purchase agreement and certificates of participation therein authorizing the ex- ecution and delivery of a Defeasance Trust Agreement and the exer- cise of an option to pur- chase the property pursu- ant to the lease/purchw ,e agreement WHEREAS the City of Pasco Washington (the City ) by Ordinance No 2766 passed by the City Council and approved by the Mayor on January 16 1990 approved and autho- rized the proper officials of the City to execute and de liver a Lease/Purchase Agreement (the Lease/ Purchase Agreement ) dated as of January 26 1990 by and between Gla cier Park Company as Les sor and the City as Lessee pursuant to which the City leased from the Lessor with an option to purchase certain property (the Prop tarty ) consisting of certain parcels of irrigated land to gether with water rights walls easements and as sociated fixtures and equipment constituting the irrigation system located on the land expected to be used on a future date as an industrial wastewater treatment facility and to comprise part of the City s Waterworks Utility includ- ing the system of sewerage as a part thereof and WHEREAS pursuant to Section 3 of Ordinance No 2766 the City pledged the full faith credit and re- sources of the City for the payment of rentals payable under the Lease/Purchase Agreement and pledged to budget and appropriate from annual taxes and other revenues available to the City without a vote of the electors of the City amounts sufficient to- gether with other money legally available therefor to pay all rentals payable un- der the Lease/Purchase Agreement when due and WHEREAS the Lessor s interest in the Lease/ Purchase Agreement was assigned by Glacier Park Company to Seattle-First National Bank as Escrow Agent (the Escrow Agent ) under that certain Escrow Agreement (the Escrow Agreement ) dated as of January 26 1990 by and between U S Bank of Washington National As sociation (the Bank ) and the Escrow Agent and WHEREAS with the ap- proval of the City the Bank executed sold and deliv- ered to investors certain certificates of participation (the Certificates ) eviden- cing and representing undi vided proportionate owner- ship interests in and to the City s obligation under the Lease/Purchase Agreement to make rental payments and if the City exercises its option to pur chase the Property to pay the purchase price of the Property and WHEREAS pursuant to Section 9 1 of the Lease/ Purchase Agreement the City has the right on any rental payment date (each January 1 and July 1) on or after January 1 1 992 to purchase the Property from the Lessor for a purchase price specified in Attach- ment C to the Lease/ Purchase Agreement which purchase price on January 1 1995 will be $1 997 450 and WHEREAS --pursuant to 'Section 11 of the Escrow Agreement and provisions of the Certificates the obligations of the City un- der the Lease/Purchase Agreement as evidenced and represented by the Certificates may be defeased by depositing in trust with a trustee govern ment obligations as defined in Chapter 39 53 RCW ( Government Obligations ) and cash if required in an amount that in the opinion of an independent certified public accountant will be fully sufficient to pay and discharge the principal of and interest on all out- standing Certificates on or before their respective prin- cipal payment dates NOW THEREOFORE THE CITY COUNCIL OF THE CITY OF PASCO WASHINGTON DO OR ,DAIN as follows Section 1 Approval of ,Defeasance Plan The City Council finds it to be in the best interest of the City to exercise the option of the City under the Lease/ Purchase Agreement to ,purchase the Property on January 1 1995 and to l provide for the defeasance of the obligations of the City under the Lease/ Purchase. Agreement as ,evidenced and represented by the Certificates by de- positing in trust with Seattle First National Bank as trustee Government Obligations and cash if re quired in an amount that in the opinion of an in- dependent certified public accountant will be fully suf- ficient to pay and discharge the principal of and interest ' on all outstanding Certificates on January 1 , 1995 (the Defeasance I Plan ) Section 2 Approval and Authorization of Defeasance Trust Agreement The form of Defeasance Trust Agreement by and be tween the City and Seattle- First National Bank pre- sented to and on file with the City Council is ap- proved and the Mayor and City Clerk are authorized and directed to execute fand deliver the Defeasance Trust Agreement in sub- stantially such form The Mayor City Clerk and other officials of the City are fur ther authorized to execute and deliver all other doc uments and take such ac bons as are reasonable and necessary to carry out the Defeasance Plan Section 3 Transfer of Funds The Director of Finance/Budget of the City is authorized to transfer $1 997 450 from the Gen- eral Fund of the City to Seattle-First National Bank as trustee to be applied pursuant to the Defeasance Trust Agreement to purchase the Government Obligations specified on Schedule A to the Defeasance Trust Agreement and provide a beginning cash balance as required to carry out the Defeasance Plan Any funds transferred to the City pursuant to the Defeasance Tr i ust Agreement after the Defeasance Plan is fully carried out shall be depos nod in the General Fund of the City Section 4 Ratification All actions heretofore taken by any official of the City to carry out the Defeasance Plan consistent with the provisions of this ordinance are ratified and confirmed PASSED by the City Coun- cil of the City of Pasco Washington at a regular open public meeting hereof this 15th day of Au gust 1994 and signed in authentication of its pas sage this 15 day of August 1994 CITY OF PASCO WASHINGTON s- Joyce DeFelice A t est Mror Catherine D Seaman City Clerk Deputy #1501,1 8/21/94 < TRANSACTION REPORT > 08-17-1994(WED) 09 15 C -1- F2 A NI Sri I m 3 NO DATE TIME DESTINATION STATION PG DURATION MODE RESULT 4393 8-17 09 09 15095821453 15 0°05 56 NORM E OK 15 0°05 56 AGENDA REPORT FOR City Council TO Gary Crutchfiefi1anager FROM Dan Underwood, ina ce Director k97,/j7( SUBJECT BAN, DEFEASANCE AND LTGO BOND ORDINANCES REGULAR 8 / 1 5 / 9 4 I REFERENCE(S) A) Proposed Bond Anticipation Note Ordinance (in Council packets only - copy available in Finance Director's Office) B) Proposed Defeasance Ordinance (in Council packets only - copy available in Finance Director's Office) C) Proposed Defeasance Agreement (in Council packets only - copy available in Finance Director's Office) D) Proposed Limited Tax General Obligation Bond Ordinance (in Council packets only - copy available in Finance Director's Office) E) Preliminary Official Statement (in Council packets only - copy available in Finance Director's Office) II ACTION REQUESTED OF COUNCIUSTAFF RECOMMENDATION MOTION I move to adopt Ordinance No , authorizing issuance of $8,520,000 of Water and Sewer revenue bonds, including a $3,000,000 bond anticipation note MOTION I move to adopt Ordinance No , authorizing defeasance of an outstanding lease purchase agreement MOTION I move to adopt Ordinance No , authorizing issuance of $4,530,000 of limited tax general obligation bonds Ill FISCAL IMPACT An increase in debt service in 1995 of approximately $252,000 IV HISTORY AND FACTS BRIEF It has always been known that completion of the Civic Center would require the issuance of additional debt Initially it was anticipated that we would issue councilmanic debt for a portion, and because of debt capacity limits, a portion would be financed as a lease purchase A change in the debt capacity regulation adopted during the last legislative session has double our non-voted debt capacity As a result we can now finance the total remaining portion of the project with councilmanic bonds Because the activity center portion of the civic center will be paid for with future block grant funds, HUD requires a separate accounting of funds, to accommodate this the bond issue will be divided in two series Series A, in the amount of $780,000, will be specifically for construction of the activity center Series B, in the amount of, $3,750,000, will be used for completion of the civic center and to repay interfund loans The city's current general debt obligation includes $1,910,000 of remaining principal for the lease purchase of the industrial wastewater facility land As a result of this debt being included as a general obligation of the city, our debt capacity limit will be exceeded with the proposed $4,530,000 bond issue It has always been the intention to sell the industrial wastewater land to the water/sewer utility, now is an appropriate time to do so In order for the utility to have enough cash to purchase the land prior to the issuance of the councilmanic bonds, the city must issue a Bond Anticipation Note (BAN) A BAN is a short term note that will be paid with the proceeds of a future bon i /1- issue, in this case, utility revenue bonds anticipated to be issued in October The BAN proceeds will be used to redeem the outstanding lease purchase debt, thus freeing enough debt capacity to issue the proposed councilmanic bonds The interest paid for the BAN will be more than offset by the early redemption of the lease purchase Certificates of Participation V DISCUSSION Alan Dashen, a representative of Seattle Northwest Securities Corporation, will be here to purchase the bonds VI OTHER FACTS All the blanks currently found in the Preliminary Official Statement will be filled in by meeting time on Monday August 15, 1994