HomeMy WebLinkAbout4704 Ordinance - LID No.152 Bond Anticipation Notes (101434497.5)
FG: 101434497.5
CITY OF PASCO, WASHINGTON
ORDINANCE NO. 4704
AN ORDINANCE of the City of Pasco, Washington, relating to
contracting indebtedness; authorizing the issuance of local improvement district
bond anticipation notes to pay costs relating to the construction of Local
Improvement District No. 152 improvements pending the issuance of local
improvement district bonds authorized to be issued by Ordinance No. 4592; fixing
or setting parameters with respect to certain terms and covenants of the notes;
appointing the City’s designated representative to approve the final terms of the
sale of the notes; and providing for other related matters.
Passed: January 16, 2024
This document prepared by:
Foster Garvey P.C.
1111 Third Avenue, Suite 3000
Seattle, Washington 98101
(206) 447-4400
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TABLE OF CONTENTS
Page
Section 1 . Definitions............................................................................................................... 1
Section 2 . Findings and Determinations .................................................................................. 4
Section 3 . Authorization of Bonds ........................................................................................... 4
Section 4 . Purpose and Authorization of Notes ....................................................................... 5
Section 5 . Description of the Notes; Appointment of Designated Representative .................. 5
Section 6 . Note Registrar; Registration and Transfer of Notes ............................................... 5
Section 7 . Form and Execution of Notes ................................................................................. 6
Section 8 . Payment of Notes .................................................................................................... 6
Section 9 . Failure To Pay Notes .............................................................................................. 7
Section 10 . Guaranty Fund ........................................................................................................ 7
Section 11 . Use of Note Proceeds .............................................................................................. 8
Section 12 . Redemption and Purchase of Notes ........................................................................ 8
Section 13 . Tax Covenants ........................................................................................................ 9
Section 14 . Official Statement; Continuing Disclosure. ............................................................ 9
Section 15 . Additional Covenants............................................................................................ 10
Section 16 . Execution of Note Purchase Agreement ............................................................... 10
Section 17 . Supplemental and Amendatory Ordinances.......................................................... 10
Section 18 . General Authorization and Ratification ................................................................ 10
Section 19 . Severability ........................................................................................................... 11
Section 20 . Rules of Interpretation .......................................................................................... 11
Section 21 . Effective Date of Ordinance ................................................................................. 12
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FG: 101434497.5
CITY OF PASCO, WASHINGTON
ORDINANCE NO. 4607
AN ORDINANCE of the City of Pasco, Washington, relating to
contracting indebtedness; authorizing the issuance of local improvement district
bond anticipation notes to pay costs relating to the construction of Local
Improvement District No. 152 improvements pending the issuance of local
improvement district bonds authorized to be issued by Ordinance No. 4592; fixing
or setting parameters with respect to certain terms and covenants of the notes;
appointing the City’s designated representative to approve the final terms of the
sale of the notes; and providing for other related matters.
THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON, DO ORDAIN AS
FOLLOWS:
Section 1. Definitions. As used in this ordinance, the following capitalized terms shall
have the following meanings:
(a) “Authorized Denomination” means $5,000 or any integral multiple thereof.
(b) “Beneficial Owner” means, with respect to a Note, the owner of any beneficial
interest in that Note.
(c) “Bond” means each local improvement district bond to be issued to pay and redeem
the Notes or any refunding note or notes.
(d) “Bond Counsel” means the firm of Foster Garvey P.C., its successor, or any other
attorney or firm of attorneys selected by the City with a nationally recognized standing as bond
counsel in the field of municipal finance.
(e) “City” means the City of Pasco, Washington, a municipal corporation duly
organized and existing under the laws of the State.
(f) “City Clerk” means the City Clerk of the City or the successor to the functions of
that officer.
(g) “City Council” means the legislative authority of the City, as duly and regularly
constituted from time to time.
(h) “City Manager” means the City’s City Manager or such other officer of the City
who succeeds to substantially all of the responsibilities of that office.
(i) “Code” means the United States Internal Revenue Code of 1986, as amended, and
applicable rules and regulations promulgated thereunder.
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(j) “Designated Representative” means the officer of the City appointed in Section 5
of this ordinance to serve as the City’s designated representative in accordance with RCW
39.46.040(2).
(k) “Designated Representative Certificate” means the certificate executed by the
Designated Representative on the sale date authorizing the Final Terms of the Notes.
(l) “DTC” means The Depository Trust Company, New York, New York, or its
nominee.
(m) “Final Terms” means the terms and conditions for the sale of the Notes including,
but not limited to, the amount, date or dates, denominations, interest rate or rates, payment dates,
final maturity, redemption rights, price, and other terms or covenants.
(n) “Finance Director” means the Finance Director of the City or such other officer of
the City who succeeds to substantially all of the responsibilities of that office.
(o) “Fiscal Agent” means the fiscal agent of the State, as the same may be designated
by the State from time to time.
(p) “Guaranty Fund” means the Local Improvement Guaranty Fund of the City
previously established and created pursuant to RCW 35.54.010 and Pasco Municipal Code
3.90.010.
(q) “Improvements” has the meaning provided in Ordinance No. 4592, including
without limitation, sanitary sewer construction, including site grading, manholes, a lift station and
force mains, and sewer gravity pipelines, casings, and appurtenances in the City’s East Urban
Growth Area (UGA) Expansion Area ordered in respect of LID No. 152, all as determined
necessary and advisable by the City. Incidental costs incurred in connection with carrying out and
accomplishing the Improvements, consistent with RCW 39.46.070 and Ordinance No. 4592, may
be included as costs of the Improvements.
(r) “Interest Payment Date” means each semiannual date on which interest on a Note
is due and payable, as set forth in the Note Purchase Agreement.
(s) “Issue Date” means, with respect to a Note, the date of initial issuance and delivery
of that Note to the Purchaser in exchange for the purchase price of that Note.
(t) “Letter of Representations” means the Blanket Issuer Letter of Representations
between the City and DTC, dated August 31, 1998, as it may be amended from time to time, or
any successor or substitute letter relating to the operations procedures of the Securities Depository.
(u) “LID No. 152” means Local Improvement District No. 152 of the City of Pasco,
Washington created pursuant to Ordinance No. 4592.
(v) “Local Improvement Fund” means the Local Improvement Fund created and
established by Ordinance No. 4592 in the office of the Finance Director with respect to LID No.
152.
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(w) “Mayor” means the Mayor of the City or the successor to the functions of that
office.
(x) “MSRB” means the Municipal Securities Rulemaking Board.
(y) “Note Fund” means the Local Improvement District No. 152 Bond Anticipation
Note Fund, 2024 of the City authorized by Section 8 of this ordinance.
(z) “Note Purchase Agreement” means the note purchase agreement from the
Purchaser offering to purchase the Notes and setting forth certain terms and conditions of the
issuance, sale and delivery of the Notes, executed by the Designated Representative on behalf of
the City pursuant to this ordinance.
(aa) “Note Register” means the books or records maintained by the Note Registrar for
the purpose of identifying ownership of the Notes.
(bb) “Note Registrar” means the Fiscal Agent, or any successor Note Registrar selected
by the City.
(cc) “Notes” means the Local Improvement District No. 152 Bond Anticipation Notes,
2024, of the City issued pursuant to the terms of this ordinance.
(dd) “Owner” means, without distinction, the Registered Owner and the Beneficial
Owner.
(ee) “Purchaser” means D.A. Davidson & Co., the firm serving as underwriter for the
negotiated sale of the Notes.
(ff) “Rating Agency” means each nationally recognized rating agency then maintaining
a rating on the Notes at the request of the City.
(gg) “RCW” means the Revised Code of Washington.
(hh) “Record Date” means the Note Registrar’s close of business on the 15th day of the
month preceding an Interest Payment Date. With respect to redemption of a Note prior to its
maturity, the Record Date shall mean the Note Registrar’s close of business on the date on which
the Note Registrar sends the notice of redemption in accordance with Section 12.
(ii) Registered Owner” means, with respect to a Note, the person in whose name that
Note is registered on the Note Register. For so long as the City utilizes the book–entry system for
the Notes under the Letter of Representations, Registered Owner shall mean the Securities
Depository.
(jj) “Rule 15c2-12” means Rule 15c2-12 promulgated by the SEC under the Securities
Exchange Act of 1934, as amended.
(kk) “SEC” means the United States Securities and Exchange Commission.
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(ll) “Securities Depository” means DTC, any successor thereto, any substitute
securities depository selected by the City that is qualified under applicable laws and regulations to
provide the services proposed to be provided by it, or the nominee of any of the foregoing.
(mm) “State” means the State of Washington.
(nn) “System of Registration” means the system of registration for the City’s bonds and
other obligations set forth in Ordinance No. 2845 of the City.
(oo) “Undertaking” means the undertaking to provide continuing disclosure entered into
pursuant to Section 14 of this ordinance.
Section 2. Findings and Determinations. The City takes note of the following facts and
makes the following findings and determinations:
(a) The City Council passed Ordinance No. 4592 and thereby created LID No. 152 for
the purpose ordering and financing construction of the Improvements.
(b) Pursuant to applicable law, including without limitation chapters 35.45, 35A.40 and
39.46 RCW, the City is authorized to issue the Bonds, including upon the completion of the
Improvements and the confirmation of the final assessment roll for LID No. 152, to provide
permanent financing for the Improvements. The City intends to issue the Bonds.
(c) Pursuant to applicable law, including without limitation chapter 39.50 RCW, the
City is authorized to issue short-term obligations in the form of local improvement district bond
anticipation notes if local improvement district bonds have been authorized by ordinance.
(d) RCW 35.54.060 provides that, for the purpose of maintaining its local improvement
guaranty fund, every city shall, at the time of making its annual budget and tax levy, provide for
the levy of a sum sufficient, with other sources of the fund, to pay the warrants issued against the
guaranty fund during the preceding fiscal year and to establish a balance therein (the “Guaranty
Fund Levy”). The statute further provides that the Guaranty Fund Levy in any one year may not
exceed the greater of: (1) 12 percent of the outstanding obligations guaranteed by the guaranty
fund or (2) the total amount of delinquent assessments and interest accumulated on the delinquent
assessments before the levy as of September 1, and that the taxes levied for the maintenance of the
local improvement guaranty fund shall be additional to and, if need be, in excess of all statutory
and charter limitations applicable to tax levies in the city.
(e) In anticipation of the issuance of the Bonds, and in order to provide interim
financing for costs of the Improvements, it is in the best interest of the City to issue and sell the
Notes to the Purchaser.
Section 3. Authorization of Bonds. For the purpose of paying or financing costs of the
Improvements and providing funds necessary to pay the Notes, the City shall issue Bonds in such
amount and form and with such terms as the City Council determines by ordinance. Proceeds of
the Bonds shall be paid into the Note Fund and applied, together with prepaid assessments received
from LID No. 152 and other available funds, in the amount sufficient to pay the Notes.
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Section 4. Purpose and Authorization of Notes. For the purpose of providing all or part
of the money required to pay or reimburse the City for costs of the Improvements, make a deposit
to the Guaranty Fund, pay interest on the Notes for a period not longer than six months after
completion of construction of the Improvements, and pay the costs of issuance of the Notes
pending issuance of the Bonds, the City is authorized to borrow money on the credit of the City
and issue the Notes with such Final Terms as are determined by the Designated Representative
consistent with the parameters set forth in Exhibit A to this ordinance.
Section 5. Description of the Notes; Appointment of Designated Representative. The
City Manager and the Finance Director, each acting independently, is appointed as the Designated
Representative of the City and is authorized and directed to conduct the sale of the Notes, in the
manner and upon the terms deemed most advantageous to the City, and to approve the Final Terms
of the Notes, with such additional terms and covenants as the Designated Representative deems
advisable, within the parameters set forth in Exhibit A.
Section 6. Note Registrar; Registration and Transfer of Notes.
(a) Registration of Notes. The Notes shall be issued only in registered form as to both
principal and interest, and the ownership of the Notes shall be recorded on the Note Register.
(b) Note Registrar; Duties. The Fiscal Agent is appointed as initial Note Registrar. The
Note Registrar shall keep, or cause to be kept, at its office, sufficient books for purposes of
registering the name, mailing address and taxpayer identification number of the Registered Owners
of the Notes, and for registering any transfer of Note ownership. The books and records maintained
by the Note Registrar for such purpose shall be considered the Note Register for purposes of this
Ordinance. The Note Register shall at all times be open to inspection by the City. In addition to
maintaining the Note Register, the Note Registrar is authorized and directed to perform the
following duties with respect to the Notes: (i) to authenticate the Notes upon the initial issuance
thereof by executing the Certificate of Authentication contained thereon; (ii) to authenticate and
deliver any Note that is transferred in accordance with the provisions thereof and this ordinance;
(iii) to serve as the City’s paying agent for the Notes; (iv) to imprint on each Note transferred or
exchanged pursuant to this ordinance the name of the Registered Owner, the principal amount of
the Note, the interest rate borne by the Note, and the maturity date of the Note; (v) to cancel the
Note returned to the Note Registrar upon the payment in full thereof; and (vi) to carry out all of
the Note Registrar’s duties otherwise described in this ordinance and to comply fully with all
applicable federal and State laws and regulations respecting the carrying out of those duties. The
Note Registrar shall be responsible for its representations contained in the Certificate of
Authentication on the Notes.
(c) Transfer and Exchange. The Notes may be assigned or transferred only if endorsed
in the manner provided thereon and surrendered to the Note Registrar. Any such transfer shall be
without cost to the Registered Owner or transferee (other than any cost incurred by the Registered
Owner or transferee in preparing and delivering such transfer certificate) and shall be noted on the
Note Register. The Note Registrar shall not be obligated to assign or transfer any Note during the
15 days preceding any payment or redemption date.
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(d) Securities Depository; Book-Entry Only Form. The Designated Representative may
determine whether the Notes are to be issued in certificated or fully immobilized book-entry only
form. If the Notes are issued in book-entry form, DTC shall be appointed as initial Securities
Depository. Each Note initially shall be registered in the name of Cede & Co., as the nominee of
DTC. Each Note registered in the name of the Securities Depository shall be held in accordance
with the provisions of the Letter of Representations. Registered ownership of any Note registered
in the name of the Securities Depository may not be transferred except: (i) to any successor
Securities Depository; (ii) to any substitute Securities Depository appointed by the City; or (iii) to
any person if the Notes are no longer to be held in book-entry only form. Upon the resignation of
the Securities Depository, or upon a termination of the services of the Securities Depository by the
City, the City may appoint a substitute Securities Depository. If (i) the Securities Depository
resigns and the City does not appoint a substitute Securities Depository, or (ii) the City terminates
the services of the Securities Depository, the Notes no longer shall be held in book-entry only form
and the registered ownership of each Note may be transferred to any person as provided in this
ordinance. Neither the City nor the Note Registrar shall have any obligation to participants of any
Securities Depository or the persons for whom they act as nominees regarding accuracy of any
records maintained by the Securities Depository or its participants. Neither the City nor the Note
Registrar shall be responsible for any notice that is permitted or required to be given to a Registered
Owner except such notice as is required to be given by the Note Registrar to the Securities
Depository.
Section 7. Form and Execution of Notes.
(a) Form of Notes; Signatures and Seal. The Notes shall be prepared in a form
consistent with the provisions of this ordinance and State law, shall be signed by the Mayor and
the City Clerk, either or both of whose signatures may be manual or in facsimile, and shall have
the seal of the City (or facsimile reproduction thereof) impressed or printed thereon. If any officer
whose signature appears on the Notes ceases to be an officer of the City authorized to sign notes
before the Note bearing such officer’s signature is authenticated or delivered by the Note Registrar
or issued by the City, that Note nevertheless may be authenticated, delivered and issued and, when
authenticated, delivered and issued, shall be as binding upon the City as though that person had
continued to be an officer of the City authorized to sign notes. Any Note also may be signed and
attested on behalf of the City by any person who, on the actual date of the signing of the Note, is
an officer of the City authorized to sign notes, although such person did not hold the required office
on the date of issuance of the Notes.
(b) Authentication. The Note shall not be valid or obligatory for any purpose, or entitled
to the benefits of this ordinance, unless it bears a certificate of authentication manually signed by
the Note Registrar stating: “This Note is one of the fully registered City of Pasco, Washington,
Local Improvement District No. 152 Bond Anticipation Notes, 2024, described in the Note
Ordinance.” A minor deviation in the language of such certificate shall not void a certificate of
authentication that otherwise is substantially in the form of the foregoing. The authorized signing
of a certificate of authentication shall be conclusive evidence that the Note so authenticated has
been duly executed, authenticated and delivered and is entitled to the benefits of this ordinance.
Section 8. Payment of Notes. Both principal of and interest on the Notes shall be
payable solely out of the City’s Local Improvement District No. 152 Bond Anticipation Note Fund,
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2024 (the “Note Fund”), a special fund that is hereby authorized to be created and maintained by
the Finance Director, and the Guaranty Fund, and shall be payable in lawful money of the United
States of America. Principal of and interest on each Note registered in the name of the Securities
Depository is payable in the manner set forth in the Letter of Representations. Interest on each
Note not registered in the name of the Securities Depository is payable by electronic transfer on
each Interest Payment Date, or by check or draft of the Note Registrar mailed on such Interest
Payment Date to the Registered Owner at the address appearing on the Note Register on the Record
Date. However, the City is not required to make electronic transfers except pursuant to a request
by a Registered Owner in writing received at least ten days prior to the Record Date and at the sole
expense of the Registered Owner. Principal of each Note not registered in the name of the
Securities Depository is payable upon presentation and surrender of the Note by the Registered
Owner to the Note Registrar. The Notes are not subject to acceleration under any circumstances.
The City covenants that on or before the maturity date of the Notes it will issue the Bonds,
refunding bond anticipation notes or a combination of the foregoing in an amount sufficient,
together with prepaid assessments received from LID No. 152 and other available funds, to pay
the Notes when due.
Section 9. Failure To Pay Notes. If principal of the Notes is not paid when properly
presented for payment on their maturity date or date of prior redemption, the City shall be obligated
to pay interest on the Notes from and after their maturity or prior redemption date until the Notes,
both principal and interest, are paid in full or until sufficient money for that payment in full is on
deposit in the Note Fund, and the City has given the Registered Owner notice that such money is
available to make such payment.
Section 10. Guaranty Fund. On the Issue Date, proceeds of the Notes in an amount, as
determined by the Designated Representative and not exceeding 10 percent of proceeds of the
Notes, shall be deposited into the Guaranty Fund such that the balance in the Guaranty Fund equals
an amount not less than the balance required to be maintained under this Section. For so long as
any of the Notes remain outstanding, the City shall take such actions as may be necessary,
consistent with chapters 34.45 and 35.54 RCW and other applicable state law and applicable
requirements of the Code, to maintain a minimum balance in the Guaranty Fund equal to 10 percent
of the principal amount of all bonds, notes and other obligations secured by the Guaranty Fund,
provided, that for the purpose of this calculation, the principal amount of bonds, notes and other
obligations secured by the Guaranty Fund shall be reduced by the amount then on deposit in the
respective debt service funds held by the City for payment and redemption of such bonds, notes
and other obligations.
In connection with the City’s annual budget preparation, the Finance Director shall review
the amount on deposit in the Guaranty Fund, the amount of delinquent installment payments
(including interest thereon) of local improvement district assessments secured by the Guaranty
Fund, and the respective amounts reasonably expected to be recovered from foreclosure
proceedings pursuant to chapter 35.50 RCW or other applicable law. Based on that review the
City shall, pursuant to RCW 35.54.060 and subject to applicable state law and constitutional
limitations and applicable requirements of the Code, provide for the levy of a sum sufficient,
together with other sources of the Guaranty Fund, to maintain the minimum balance described in
the preceding paragraph, and to provide for all payments reasonably expected to be made out of
the Guaranty Fund.
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Interest and earnings from the Guaranty Fund shall be retained within the Guaranty Fund.
The Finance Director may establish subaccounts within the Guaranty Fund, from time to time as
the Finance Director deems necessary or desirable for purposes of accounting for the investment
of money therein. Money in the Guaranty Fund shall be used solely for the payment of bonds ,
notes and other obligations secured by such fund and as otherwise set forth in chapter 35.54 RCW
and other applicable law. Earnings subject to a federal tax or rebate requirement may be withdrawn
from the Guaranty Fund and used for those tax or rebate purposes. Any proceeds of Notes
remaining in the Guaranty Fund that the City determines will, upon the City’s issuance of Bonds
to pay and redeem the Notes, be in excess of the minimum balance required to be held therein
under this Section and no longer required for the purposes of the Guaranty Fund, may be
withdrawn from the Guaranty Fund and used and applied, together with prepaid assessments
received from LID No. 152 and proceeds of the Bonds, to pay principal of and interest on the Notes
consistent with applicable law.
Section 11. Use of Note Proceeds. The proceeds of the Notes and interest earnings
thereon shall be deposited in the Local Improvement Fund and used to pay or reimburse the City
for costs of the Improvements, make a deposit to the Guaranty Fund, pay interest on the Notes for
a period not longer than six months after completion of construction of the Improvements, and pay
the costs of issuance of the Notes. Until needed to pay those costs, the City may invest proceeds
of the Notes temporarily in any legal investment. Earnings subject to a federal tax or rebate
requirement may be withdrawn from the Local Improvement Fund and used for those tax or rebate
purposes. Any proceeds of Notes remaining in the Local Improvement Fund after paying or
reimbursing the costs of the Improvements, the costs of issuing the Notes, and for the other
purposes set forth in this section, or after the City Council has determined that the expenditure of
such Note proceeds for those purposes is no longer necessary or appropriate, may be used to pay
principal of and interest on the Notes consistent with applicable law.
Section 12. Redemption and Purchase of Notes.
(a) Redemption Provisions. The Notes shall have such redemption provisions, if any,
as shall be determined by the Designated Representative in accordance with the parameters set
forth in Exhibit A to this ordinance.
(b) Selection of Notes for Redemption; Partial Redemption. For so long as the Notes
are registered in the name of the Securities Depository, if less than all of the principal amount of
Notes with the same redemption date is to be redeemed, the Securities Depository shall select the
proportion of those Notes to be redeemed in accordance with the Letter of Representations. If the
Notes are not registered in the name of the Securities Depository, the Note Registrar shall select
the proportion of those Notes with the same redemption date to be redeemed randomly in such
manner as the Note Registrar shall determine. All or a portion of the principal amount of any Note
that is to be redeemed may be redeemed in any Authorized Denomination. If less than all of the
outstanding principal amount of any Note is redeemed, upon surrender of that Note to the Note
Registrar, there shall be issued to the Registered Owner, without charge, a new Note, bearing the
same estimated redemption date and interest rate, in the aggregate principal amount to remain
outstanding.
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(c) Notice of Redemption. Notice of redemption of each Note registered in the name of
the Securities Depository shall be given in accordance with the Letter of Representations. Notice
of redemption of each other Note, unless waived by the Registered Owner, shall be given by the
Note Registrar not less than 20 nor more than 60 days prior to the date fixed for redemption by
first-class mail, postage prepaid, to the Registered Owner at the address appearing on the Note
Register on the Record Date. The requirements of the preceding sentence shall be satisfied when
notice has been mailed as so provided, whether or not it is actually received by an Owner. In
addition, the redemption notice shall be mailed or sent electronically within the same period to the
MSRB (if required under the Undertaking), to each Rating Agency, 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 any Note.
(d) Rescission of Redemption Notice. In the case of any redemption, the notice of
redemption may state that the City retains the right to rescind the redemption notice by giving a
notice of rescission to the affected Registered Owner(s) at any time on or prior to the date fixed
for redemption. Any notice of redemption that is so rescinded shall be of no effect, and each Note
for which a notice of redemption has been rescinded shall remain outstanding.
(e) Effect of Redemption. Interest on the principal portion of each Note called for
redemption shall cease to accrue on the date fixed for redemption, unless the notice of redemption
is rescinded as set forth above or payment is not made for the Note called for redemption
(f) Purchase of Notes. The City reserves the right to purchase any or all of the Notes
at any time at any price acceptable to the City plus accrued interest to the date of purchase.
Section 13. Tax Covenants.
(a) Preservation of Tax Exemption for Interest on the Notes. The City covenants that it
will take all actions necessary to prevent interest on the Notes 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 Notes or other funds of the City treated as proceeds of the Notes that will cause
interest on the Notes to be included in gross income for federal income tax purposes. The City also
covenants that it will, to the extent the arbitrage rebate requirements of Section 148 of the Code
are applicable to the Notes, take all actions necessary to comply (or to be treated as having
complied) with those requirements in connection with the Notes.
(b) Post-Issuance Compliance. The Finance Director is authorized and directed to
adopt, implement, review and update the City’s written procedures to facilitate compliance by the
City with the covenants in this ordinance and the applicable requirements of the Code that must
be satisfied after the Issue Date to prevent interest on the Notes from being included in gross
income for federal tax purposes.
Section 14. Official Statement; Continuing Disclosure.
(a) Preliminary Official Statement Deemed Final. The Designated Representative shall
review the form of the preliminary official statement prepared in connection with the sale of the
Notes to the public. For the sole purpose of the Purchaser’s compliance with paragraph (b)(1) of
Rule 15c2-12, the Designated Representative is authorized to deem that preliminary official
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statement final as of its date, except for the omission of information permitted to be omitted by
Rule 15c2-12. The City approves the distribution to potential purchasers of the Notes of a
preliminary official statement that has been deemed final in accordance with this subsection.
(b) Approval of Final Official Statement. The City approves the preparation of a final
official statement for the Notes to be sold to the public in the form of the preliminary official
statement, with such modifications and amendments as the Designated Representative deems
necessary or desirable, and further authorizes the Designated Representative to execute and deliver
such final official statement to the Purchaser. The City authorizes and approves the distribution by
the Purchaser of that final official statement to purchasers and potential purchasers of the Notes.
(c) Undertaking to Provide Continuing Disclosure. To meet the requirements of
paragraph (b)(5) of Rule 15c2-12, as applicable to a participating underwriter for the Notes, the
Designated Representative is authorized and directed to execute a written undertaking to provide
continuing disclosure for the benefit of holders of the Notes in substantially the form attached as
Exhibit B.
Section 15. Additional Covenants. The City covenants that it will (a) proceed with due
diligence to construct the Improvements; (b) require contractors to maintain performance bonds
and (c) proceed to promptly confirm the assessment roll with respect to LID No. 152 when final
costs of the Improvements are known to the City.
Section 16. Execution of Note Purchase Agreement. The City Manager and the Finance
Director, each acting independently, are authorized to execute as necessary the Note Purchase
Agreement on behalf of the City.
The Notes will be prepared at City expense and will be delivered to the Purchaser in
accordance with the Note Purchase Agreement, together with the approving legal opinion
of Bond Counsel regarding the Notes.
Section 17. Supplemental and Amendatory Ordinances. The City may supplement or
amend this ordinance for any one or more of the following purposes without the consent of the
Registered Owner:
(a) To add covenants and agreements that do not materially adversely affect the
interests of the Registered Owner, or to surrender any right or power reserved to or conferred upon
the City.
(b) To cure any ambiguities, or to cure, correct or supplement any defective provision
contained in this ordinance in a manner that does not materially adversely affect the interest of the
Registered Owner.
Section 18. General Authorization and Ratification. The Mayor, the City Manager, the
Finance Director, the City Clerk, other appropriate officers of the City and Bond Counsel are
severally authorized to take such actions and to create, accept, execute, send, use and rely upon
such documents, records and signatures (including in tangible medium, manual, facsimile or
electronic form, under any security procedure or platform, and notwithstanding any other City
ordinance, resolution, rule or policy) as in their judgment may be necessary or desirable to carry
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out the transactions contemplated in connection with this ordinance, and to do everything
necessary for the prompt delivery of the Notes to the Purchaser and for the proper application, use
and investment of the proceeds of the Notes. All actions taken prior to the effective date of this
ordinance in furtherance of the purposes described in this ordinance and not inconsistent with the
terms of this ordinance are ratified and confirmed in all respects.
Section 19. Severability. The provisions of this ordinance are declared to be separate
and severable. If a court of competent jurisdiction, all appeals having been exhausted or all appeal
periods having run, holds any provision of this ordinance to be invalid or unenforceable as to any
person or circumstance, such offending provision shall, if feasible, be deemed to be modified to
be within the limits of enforceability or validity. However, if the offending provision cannot be so
modified, it shall be null and void with respect to the particular person or circumstance, and all
other provisions of this ordinance in all other respects, and the offending provision with respect to
all other persons and all other circumstances, shall remain valid and enforceable.
Section 20. Rules of Interpretation. In this ordinance, unless the context or use
otherwise requires:
(a) The terms “hereby,” “hereof,” “hereto,” “herein” and any similar terms refer to this
ordinance as a whole and not to any particular section, paragraph, clause or subdivision of this
ordinance, and the term “heretofore” means before the date of this ordinance;
(b) All pronouns in this ordinance include all other pronouns, and words importing the
singular number mean and include the plural number and vice versa;
(c) The terms: (i) “includes” and “including” are not limiting; (ii) “or” is not exclusive;
and (iii) “person” or “persons” include firms, associations, partnerships (including limited
partnerships), trusts, corporations and other legal entities, including public bodies, as well as
natural persons;
(d) The cover page, the table of contents and any headings preceding the text of the
several sections and paragraphs of this ordinance, and any marginal notes appended to copies
hereof, are solely for convenience of reference and do not constitute a part of this ordinance, nor
do they affect its meaning, construction or effect; and
(e) All references herein to “sections,” “paragraphs, “clauses” and other subdivisions
are to the corresponding sections, paragraphs, clauses or subdivisions hereof.
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Section 21. Effective Date of Ordinance. This ordinance shall take effect and be in force
from and after its passage and five days following its publication as required by law.
PASSED by the City Council of the City of Pasco, Washington, at an open public meeting
thereof, this 16th day of January, 2024, and signed in authentication of its passage this 16th day of
January, 2024.
Pete Serrano, Mayor
ATTEST:
Debra Barham, City Clerk
APPROVED AS TO FORM:
Foster Garvey P.C.
Bond Counsel
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Exhibit A
A-1
FG: 101434497.5
EXHIBIT A
PARAMETERS FOR FINAL TERMS OF THE NOTES
i. Principal Amount. The aggregate principal amount of the Notes shall not
exceed $21,000,000.
ii. Date. Each Note shall be dated its Issue Date, which date may not
be later than one year after the effective date of this
ordinance.
iii. Denominations, Name, etc. The Notes shall be issued in Authorized Denominations. The
Notes shall bear any name and additional designation as
deemed necessary or appropriate by the Designated
Representative or the Bond Registrar.
iv. Interest Rate(s). Each Note shall bear interest at the same fixed rate per
annum (computed on the basis of a 360-day year of twelve
30-day months) from the Issue Date or from the most recent
date for which interest has been paid or duly provided for,
whichever is later. The rate of interest for the Notes may not
exceed 6.50%, and the true interest cost to the City for the
Notes may not exceed 6.50%.
v. Interest Payment Dates. Interest shall be payable semiannually on such Interest
Payment Dates as are acceptable to the Designated
Representative, commencing no later than one year after the
Issue Date.
vi. Maturity Date. The Notes shall mature on an Interest Payment Date
acceptable to the Designated Representative that is not later
than three years after the Issue Date.
vii. Redemption Rights. The Designated Representative may approve redemption
provisions contained in the Note Purchase Agreement
providing that (A) the Notes shall not be subject to
redemption prior to their maturity date, or (B) the Notes shall
be subject to redemption, in whole or in part, prior to their
maturity date on any date on or after a date acceptable to the
Designated Representative at a redemption price equal to the
principal amount thereof plus accrued and unpaid interest to
the redemption date.
viii. Price. The purchase price of the Notes shall not be less than 95%
nor more than 110% of the stated principal amount of the
Notes.
ix. Other Terms & Conditions. The Designated Representative may determine whether it is
in the City’s best interest to provide for bond insurance or
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other credit enhancement; and may accept such additional
terms, conditions and covenants as he or she may determine
are in the best interests of the City, consistent with this
ordinance.
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Exhibit B
B-1
FG: 101434497.5
[Form of]
UNDERTAKING TO PROVIDE CONTINUING DISCLOSURE
City of Pasco, Washington
Local Improvement District No. 152 Bond Anticipation Notes, 2024
The City of Pasco, Washington (the “City”), makes the following written Undertaking for
the benefit of holders of the above-referenced Notes (the “Notes”), for the sole purpose of assisting
the Purchaser in meeting the requirements of paragraph (b)(5) of Rule 15c2-12, as applicable to a
participating underwriter for the Notes. Capitalized terms used but not defined below shall have
the meanings given in Ordinance No. ____ of the City (the “Note Ordinance”).
(a) Undertaking to Provide Annual Financial Information and Notice of Listed Events.
The City undertakes to provide or cause to be provided, either directly or through a designated
agent, to the MSRB, in an electronic format as prescribed by the MSRB, accompanied by
identifying information as prescribed by the MSRB:
(i) Annual financial information and operating data of the type included in the final
official statement for the Notes and described in paragraph (b) (“annual financial
information”);
(ii) Timely notice (not in excess of 10 business days after the occurrence of the event)
of the occurrence of any of the following events with respect to the Notes:
(1) principal and interest payment delinquencies; (2) non-payment related defaults,
if material; (3) unscheduled draws on debt service reserves reflecting financial
difficulties; (4) unscheduled draws on credit enhancements reflecting financial
difficulties; (5) substitution of credit or liquidity providers, or their failure to
perform; (6) adverse tax opinions, the issuance by the Internal Revenue Service of
proposed or final determinations of taxability, Notice of Proposed Issue (IRS Form
5701 – TEB) or other material notices or determinations with respect to the tax
status of the Notes, or other material events affecting the tax status of the Notes;
(7) modifications to rights of holders of the Notes, if material; (8) bond calls (other
than scheduled mandatory redemptions of Term Notes), if material, and tender
offers; (9) defeasances; (10) release, substitution, or sale of property securing
repayment of the Notes, if material; (11) rating changes; (12) bankruptcy,
insolvency, receivership or similar event of the City or any obligated person, as
such “obligated person” and “Bankruptcy Events” are defined in Rule 15c2-12;
(13) the consummation of a merger, consolidation, or acquisition involving the City
or an obligated person or the sale of all or substantially all of the assets of the City
or an obligated person 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;
(14) appointment of a successor or additional trustee or the change of name of a
trustee, if material; (15) incurrence of a financial obligation of the City or obligated
person, if material, or agreement to covenants, events of default, remedies, priority
rights, or other similar terms of a financial obligation of the City or obligated
person, any of which affect security holders, if material; and (16) default, event of
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acceleration, termination event, modification of terms, or other similar events under
the terms of the financial obligation of the City or obligated person, any of which
reflect financial difficulties. The term “financial obligation” means a (i) debt
obligation; (ii) derivative instrument entered into in connection with, or pledged as
security or a source of payment for, an existing or planned debt obligation; or (iii)
guarantee of (i) or (ii). The term “financial obligation” shall not include municipal
securities as to which a final official statement has been provided to the MSRB
consistent with Rule 15c2-12; and
(iii) Timely notice of a failure by the City to provide required annual financi al
information on or before the date specified in paragraph (b).
(b) Type of Annual Financial Information Undertaken to be Provided. The annual
financial information that the City undertakes to provide in paragraph (a):
(i) Shall consist of (1) annual financial statements prepared (except as noted in the
financial statements) in accordance with applicable generally accepted accounting
principles applicable to local governmental units of the State such as the City, as
such principles may be changed from time to time, which statements may be
unaudited, provided, that if and when audited financial statements are prepared and
available they will be provided; (2) a statement of the outstanding balance of
obligations secured by the Local Improvement Guaranty Fund; (3) the balance of
cash and investments in the Local Improvement Guaranty Fund at fiscal year end;
and (4) a statement of the amount of assessments that the City billed and collected
in that fiscal year;
(ii) Shall be provided not later than the last day of the ninth month after the end of each
fiscal year of the City (currently, a fiscal year ending December 31), as such fiscal
year may be changed as required or permitted by State law, commencing with the
City’s fiscal year ending December 31, 2023; and
(iii) May be provided in a single or multiple documents, and may be incorporated by
specific reference to documents available to the public on the Internet website of
the MSRB or filed with the SEC.
If not submitted as part of the annual financial information described in paragraph (b)(i)
above, the City will provide or cause to be provided to the MSRB audited financial statements,
when and if available.
(c) Amendment of Undertaking. This Undertaking is subject to amendment after the
primary offering of the Notes without the consent of any holder of any Note, or of any broker,
dealer, municipal securities dealer, participating underwriter, Rating Agency or the MSRB, under
the circumstances and in the manner permitted by Rule 15c2-12. The City will give notice to the
MSRB of the substance (or provide a copy) of any amendment to the Undertaking and a brief
statement of the reasons for the amendment. If the amendment changes the type of annual financial
information to be provided, the annual financial information containing the amended financial
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information will include a narrative explanation of the effect of that change on the type of
information to be provided.
(d) Beneficiaries. This Undertaking shall inure to the benefit of the City and the holder
of each Note, and shall not inure to the benefit of or create any rights in any other person.
(e) Termination of Undertaking. The City’s obligations under this Undertaking shall
terminate upon the legal defeasance of all of the Notes. In addition, the City’s obligations under
this Undertaking shall terminate if the provisions of Rule 15c2-12 that require the City to comply
with this Undertaking become legally inapplicable in respect of the Notes for any reason, as
confirmed by an opinion of Bond Counsel delivered to the City, and the City provides timely notice
of such termination to the MSRB.
(f) Remedy for Failure to Comply with Undertaking. As soon as practicable after the
City learns of any failure to comply with this Undertaking, the City will proceed with due diligence
to cause such noncompliance to be corrected. No failure by the City or other obligated person to
comply with this Undertaking shall constitute a default in respect of the Notes. The sole remedy
of any holder of a Note shall be to take action to compel the City or other obligated person to
comply with this Undertaking, including seeking an order of specific performance from an
appropriate court.
(g) Designation of Official Responsible to Administer Undertaking. The Finance
Director or his or her designee is the person designated, in accordance with the Note Ordinance,
to carry out the Undertaking in accordance with Rule 15c2-12, including, without limitation, the
following actions:
(i) Preparing and filing the annual financial information undertaken to be provided;
(ii) Determining whether any event specified in paragraph (a) has occurred, assessing
its materiality, where necessary, with respect to the Notes, and preparing and
disseminating any required notice of its occurrence;
(iii) Determining whether any person other than the City is an “obligated person” within
the meaning of Rule 15c2-12 with respect to the Notes, and obtaining from such
person an undertaking to provide any annual financial information and notice of
listed events for that person required under Rule 15c2-12;
(iv) Selecting, engaging and compensating designated agents and consultants, including
financial advisors and legal counsel, to assist and advise the City in carrying out
this Undertaking; and
(v) Effecting any necessary amendment of this Undertaking.
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CERTIFICATION
I, the undersigned, City Clerk of the City of Pasco, Washington (the “City”), hereby certify
as follows:
1. The attached copy of Ordinance No. 4704 (the “Ordinance”) is a full, true and
correct copy of the Ordinance duly passed at a regular meeting of the City Council of the City
(the “City Council”) held at the regular meeting place thereof on January 16, 2024 (the “Meeting”),
as the Ordinance appears on the minute book of the City.
2. The Ordinance will be in full force and effect five days after publication in the
City’s official newspaper, which publication date is January 21, 2024.
3. The Meeting was duly convened, held and included an opportunity for public
comment, in all respects in accordance with law, a quorum of the members of the City Council
was present throughout the Meeting and a majority of the members voted in the proper manner for
the passage of the Ordinance.
Dated: January 16, 2024.
CITY OF PASCO, WASHINGTON
Debra Barham, City Clerk
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