HomeMy WebLinkAbout075 - 07/21/1992 - AUTHORIZINGTHE ISSUANCE OF SEWER REVENUE BOND CERTIFIED RECORD
OF
PROCEEDINGS OF THE COUNCIL OF
THE CITY OF FORT COLLINS, COLORADO
RELATING TO AN ORDINANCE
AUTHORIZING THE ISSUANCE OF ITS
SEWER REVENUE BOND
SERIES 1992
DATED JULY 15 , 1992
IN THE PRINCIPAL AMOUNT OF $24 , 540 ,580
i
STATE OF COLORADO )
COUNTY OF LARIMER ) ss.
CITY OF FORT COLLINS )
The Council of the City of Fort Collins, Colorado, held
a regular meeting at Council Chambers, City Hall, 300 West LaPorte
Avenue, Fort Collins, Colorado, on Tuesday, the 7th day of July,
1992 , at the hour of 6: 30 p.m.
The following persons were present:
Council Members: Susan E. Kirkpatrick, Mayor
Ann Azari, Mayor Pro Tem
Dave Edwards
Cathy Fromme
Gerry Horak
Loren R. Maxey
Bob Winokur
City Manager: Steven C. Burkett
City Clerk: Wanda M. Krajicek
Financial Officer: Alan J. Krcmarik
City Attorney: Stephen J. Roy
The following persons were absent:
None
The following Ordinance was introduced and read by title,
copies of the full Ordinance having been available in the office of
the City Clerk at least forty-eight (48) hours prior to the time
the Ordinance was introduced for each Council Member and for
inspection and copying by the general public:
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ORDINANCE NO. 75, 1992
AN ORDINANCE AUTHORIZING THE EXECUTION AND DELIVERY OF A
LOAN AGREEMENT, DATED AS OF JULY 15, 1992 , BETWEEN THE
COLORADO WATER RESOURCES AND POWER DEVELOPMENT AUTHORITY
AND THE CITY OF FORT COLLINS, COLORADO, THE ISSUANCE OF
A GOVERNMENTAL AGENCY BOND (CITY OF FORT COLLINS,
COLORADO, SEWER REVENUE BOND, SERIES 1992, DATED JULY 15,
1992 , IN THE AGGREGATE PRINCIPAL AMOUNT OF $25, 000, 000)
EVIDENCING THE CITY'S OBLIGATIONS UNDER THE LOAN
AGREEMENT AND THE UNDERTAKING AND COMPLETION OF A PROJECT
RELATING TO THE SEWERAGE FACILITIES OF THE CITY OF FORT
COLLINS, COLORADO.
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS, COLORADO, THAT:
Section 1. Definitions and Construction.
A. Definitions. In this Ordinance the following terms
have the following respective meanings unless the context hereof
clearly requires otherwise:
(1) Additional Parity Bonds: any Parity Securities
issued after the issuance of the Bonds.
(2) Authority: the Colorado Water Resources and
Power Development Authority, its successor and assigns.
(3) Average Annual Debt Service Requirements: the
aggregate of all Debt Service Requirements (excluding any
redemption premiums) due on any issue of securities payable
from the Net Pledged Revenues for all Bond Years beginning
with the Bond Year in which Debt Service Requirements of such
securities are first payable and ending with the Bond Year in
which the last of the Debt Service Requirements are payable
divided by the number of such years.
(4) Bonds: the Governmental Agency Bond (City of
Fort Collins, Colorado, Sewer Revenue Bond, Series 1992 , dated
July 15, 1992 , in the aggregate principal amount of
$25, 000, 000) .
(5) Bond Year: the twelve (12) months commencing
on the second day of December of any calendar year and ending
on the first day of December of the next succeeding calendar
year.
(6) Charter: the Home Rule Charter of the City as
amended.
(7) City: the City of Fort Collins, Colorado.
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(8) Commercial Bank: a state or national bank or
trust company which is a member of the Federal Deposit
Insurance Corporation and of the Federal Reserve System, which
has a capital and surplus of $10,000,000 or more, and which is
located within the United States of America.
(9) Comparable Bond Year: in connection with any
Fiscal Year, the Bond Year which ends in such Fiscal Year.
For example, for the Fiscal Year commencing on January 1,
1993, the Comparable Bond Year for the Bonds commences on
December 2, 1992 , and ends on December 1, 1993 .
(10) Costs of the Project: all or any part of the
cost of the acquisition, construction, installation and
equipment of all or any part of the Project, to the extent
eligible for payment or reimbursement under the Loan
Agreement.
(11) Council: the governing body of the City.
(12) Debt Service Requirements: the principal of,
interest on, and any premium due in connection with the
redemption of any securities payable from the Net Pledged
Revenues, whether at maturity or otherwise.
(13) Event of Default: any of the events described
in Section 10A hereof.
(14) Federal Securities: bills, certificates of
indebtedness, notes, or bonds which are direct obligations of
the United States of America or obligations the principal and
interest of which are unconditionally guaranteed by the United
States of America.
(15) Fiscal Year: the twelve (12) months commencing
on the first day of January of any calendar year and ending on
the last day of December of such calendar year or such other
twelve (12) month period as may from time to time be
designated by the Council as the Fiscal Year of the City.
(16) Income: all income from rates, fees, tolls,
and charges and tap fees and plant investment fees, or any
combination thereof, for the services furnished by, or the
direct or indirect connection with, or the use of the Sewerage
Facilities, including, without limiting the generality of the
foregoing, minimum charges, charges for the availability of
service, disconnection fees, reconnection fees, and reasonable
penalties for any delinquencies, all supplemental user fees
payable pursuant to any contract between the City and any user
of any Sewerage Facilities, and all income or other gain, if
any, from any investment of Net Pledged Revenues and of the
proceeds of securities payable from Net Pledged Revenues
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(except income or other gain from any investment of moneys
held in any escrow or other similar fund or account for the
defeasance and/or payment of securities payable from the Net
Pledged Revenues) , but not including sewer trunk line
assessments and sewer main line assessments.
(17) Interest Payment Date: a date designated by
ordinance (or, in the case of the Bonds, by the Loan
Agreement) for the payment of interest on any securities
payable from the Net Pledged Revenues.
(18) Loan Agreement: the Loan Agreement, dated as
of July 15, 1992, between the Authority and the City,
including the exhibits thereto.
(19) Maturity Date: a date designated by ordinance
(or, in the case of the Bonds, by the Loan Agreement) for the
payment of principal of any securities payable from the Net
Pledged Revenues.
(20) Net Pledged Revenues: all Income remaining
after the deduction of Operation and Maintenance Expenses.
(21) Operation and Maintenance Expenses: such
reasonable and necessary current expenses of the City, paid or
accrued, of operating, maintaining and repairing the Sewerage
Facilities as may be determined by the Council, including,
except as limited by contract or otherwise limited by law,
without limiting the generality of the foregoing:
(a) Engineering, auditing, legal and other
overhead expenses of the City directly related and
reasonably allocable to the administration, operation and
maintenance of the Sewerage Facilities;
(b) Insurance and surety bond premiums
appertaining to the Sewerage Facilities;
(c) The reasonable charges of any paying
agent, registrar, transfer agent, depository or escrow
bank appertaining to securities payable from the Net
Pledged Revenues;
(d) Annual payments to pension, retirement,
health and hospitalization funds appertaining to the
Sewerage Facilities;
(e) Any taxes, assessments, franchise fees or
other charges or payments in lieu of the foregoing;
(f) Ordinary and current rentals of equipment
or other property;
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(g) Contractual services, professional
services, salaries, administrative expanses, and costs of
labor appertaining to the Sewerage Facilities and the
cost of materials and supplies used for current operation
of the Sewerage Facilities;
(h) The costs incurred in the collection of
all or any part of the Net Pledged Revenues;
(i) Any costs of utility services furnished to
the Sewerage Facilities by the City or otherwise.
"Operation and Maintenance Expenses" does not include:
(a) Any allowance for depreciation;
(b) Any costs of reconstruction, Improvement,
extensions, or betterments;
(c) Any accumulation of reserves for capital
replacements;
(d) Any reserves for operation, maintenance,
or repair of the Sewerage Facilities;
(e) Any allowance for the redemption of any
bonds or other securities or the payment of any interest
thereon;
(f) Any liabilities incurred in the
acquisition of any properties comprising the Sewerage
Facilities;
(g) Any other ground of legal liability not
based on contract.
(22) Operation and Maintenance Fund: the special
fund created by and designated as such in Ordinance No. 101,
1982 , and referred to in Section 5C hereof.
(23) Ordinance: this Ordinance No. 75, 1992, of the
City.
(24) outstanding: as of any particular date, all
the Prior Bonds, Bonds, Additional Parity Bonds, Parity
Securities or any such other securities payable in whole or in
part from the Net Pledged Revenues which have been authorized,
executed and delivered except the following:
(a) Any Prior Bond, Bond, Additional Parity
Bond, Parity Security or other security cancelled by or
on behalf of the City on or before such date;
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(b) Any Prior Bond, Bond, Additional Parity
Bond, Parity Security or other security held by or on
behalf of the City;
(c) Any Prior Bond, Additional Parity Bond,
Parity Security or other security of the City for the
payment or the redemption of which moneys or Federal
Securities sufficient (including the known minimum yield
available for such purpose from Federal Securities in
which such amount wholly or in part may be initially
invested) to pay all of the Debt Service Requirements of
such Prior Bond, Additional Parity Bond, Parity Security
or other security to the Maturity Date or specified
Redemption Date thereof shall have theretofore been
deposited in escrow or in trust with a Trust Bank for
that purpose;
(d) Any Bond for the payment or redemption of
which moneys equal to the Debt Service Requirements until
maturity or redemption shall have been paid to the
Authority under the Loan Agreement; and
(e) Any lost, destroyed, or wrongfully taken
Prior Bond, Bond, Additional Parity Bond, Parity Security
or other security of the City in lieu of or in
substitution for which another bond or other security
shall have been executed and delivered.
(25) Owner: the holder of any bearer instrument or
registered owner of any registered instrument.
(26) Parity Securities: bonds, warrants, notes,
securities, leases or other contracts evidencing borrowings
and payable from the Net Pledged Revenues equally or on a
parity with the Bonds.
(27) Permitted Investments: any legal investment or
deposit authorized by State statute or City ordinance adopted
pursuant to the Charter.
(28) Person: any individual, firm, partnership,
corporation, company, association, joint stock association or
body politic or any trustee, receiver, assignee or similar
representative thereof.
(29) Prior Bonds: the City of Fort Collins,
Colorado, Sewer Revenue Refunding Bonds, Series 1986, dated
August 1, 1986, in the original aggregate principal amount of
$36, 950, 000.
(30) Prior Bonds Debt Service Reserve Fund: the
special fund created by and designated in Ordinance No. 9,
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1975, of the City as the "City of Fort Collins Sewer Refunding
Revenue Bonds Reserve Fund" and referred to in Section 5E
hereof.
(31) Prior Bonds Principal and Interest Fund: the
special fund created by and designated in Ordinance No. 9 ,
1975, of the City as the "City of Fort Collins Sewer Refunding
Revenue Bonds, Series 1975, Bond Fund" and referred to in
Section 5D hereof.
(32) Project: the acquisition, construction,
installation and equipment of that portion of the Sewerage
Facilities for which the Bonds are issued.
(33) Project Loan Subaccount: the special fund or
account of the Authority referred to in Section 5A hereof.
(34) Redemption Date: the date fixed for the
redemption prior to maturity of any Bonds or other designated
securities payable from the Net Pledged Revenues in any notice
of prior redemption given by or on behalf of the City.
(35) Security or securities: any bond issued by the
City or any other evidence of the advancement of money to the
City.
(36) Sewerage Facilities: any one or more of the
various devices used in the collection, treatment, or
disposition of sewage and industrial wastes of a liquid
nature, including, without limitation, all inlets; collection,
drainage, or disposal lines; intercepting sewers; sewage
disposal plants; outfall sewers; sewage lagoons; all pumping,
power, and other equipment and appurtenances; all extensions,
improvements, remodeling, additions and alterations thereof;
any and all rights or interests for such sewerage facilities;
and all other necessary, incidental, or appurtenant
properties, equipment, and facilities relating to the
foregoing.
(37) Sewer Fund: the special fund created by and
designated as such in Ordinance No. 67, 1974 , of the City and
referred to in Section 5B hereof.
(38) State: the State of Colorado.
(39) Subordinate Bonds or Subordinate Securities:
bonds or securities payable from the Net Pledged Revenues
having a lien thereon subordinate or junior to the lien
thereon of the Bonds.
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(40) Subsequent Bonds Debt service Reserve Fund:
the special fund created by and referred to in Section 5G
hereof.
(41) Subsequent Bonds Principal and Interest Fund:
the special fund created by and referred to in Section 5F
hereof.
(42) Superior Bonds or Superior Securities: bonds
or securities payable from the Net Pledged Revenues having a
lien thereon superior or senior to the lien thereon of the
Bonds.
(43) Trustee: First Interstate Bank of Denver,
N.A. , or its successors, as trustee for the bonds of the
Authority issued to finance the loan to the City under the
Loan Agreement.
(44) Wastewater Utility Capital Reserve: the
special fund created by the City and referred to in Section 5I
hereof.
B. Construction. This Ordinance, except where the
context by clear implication herein otherwise requires, shall be
construed as follows:
(1) Words in the singular include the plural, and
words in the plural include the singular.
(2) Words in the masculine gender include the
feminine and the neuter, and when the sense so indicates words
of the neuter gender refer to any gender.
(3) Articles, sections, subsections, paragraphs and
subparagraphs mentioned by number, letter, or otherwise,
correspond to the respective articles, sections, subsections,
paragraphs and subparagraphs of this Ordinance so numbered or
otherwise so designated.
(4) The titles and headlines applied to articles,
sections and subsections of this Ordinance are inserted only
as a matter of convenience and ease in reference and in no way
define or limit the scope or intent of any provisions of this
Ordinance.
Section 2 . The Project.
A. Necessity. The City has need for and desires to
acquire, construct, install and equip the Project.
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B. Authorization. The Council hereby authorizes the
undertaking and completion of the Project.
Section 3 . The Loan Agreement.
Pursuant to art. XX, §6 of the State Constitution and
Art. V, Section 19. 3 of the Charter, the City is authorized by
Council action and without an election to execute and deliver the
Loan Agreement. The Council hereby authorizes the Mayor, the City
Clerk and the Financial Officer of the City to execute and deliver
the Loan Agreement on behalf of the City.
Section 4. The Bonds.
A. Authorization. Pursuant to art. XX, sec. 6 of the
Colorado Constitution and Art. V, Section 19 . 3 of the Charter, the
City is authorized by Council action and without an election to
issue the Bonds to evidence its obligations under the Loan
Agreement. The Council hereby authorizes the issuance of the
Bonds, payable as to all Debt Service Requirements solely out of
Net Pledged Revenues, for the purpose of acquiring, constructing,
installing and equipping the Project.
B. Bond Details.
(1) Generally. The Bonds shall mature and bear
interest as provided in the Loan Agreement.
(2) Redemption. The Bonds shall be redeemable or
prepayable as provided in the Loan Agreement.
(3) Interest Rates. The maximum net effective
interest rate authorized for the Bonds is 15% per annum, and
the actual net effective interest rate for the Bonds is
% per annum.
(4) Execution. The Bonds shall be executed by and
on behalf of the City with the manual signature of the Mayor,
shall bear the seal of the City, shall be attested with the
manual signature of the City Clerk, and shall be countersigned
with the manual signature of the Financial Officer of the
City. Should any officer whose manual signature appears on
the Bonds cease to be such officer before delivery of the
Bonds to the Authority, such manual signature shall
nevertheless be valid and sufficient for all purposes.
(5) Registration and Transfer. The Bonds shall be
in registered form and shall be transferable to the extent and
as provided in the Loan Agreement.
(6) Replacement of Bonds. If any Bond shall have
been lost, destroyed or wrongfully taken, the City shall
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provide for the replacement thereof in the manner set forth
and upon receipt of the evidence, indemnity bond and
reimbursement for expenses provided in Ordinance No. 80, 1984 .
(7) Recitals in Bonds. Each Bond shall recite in
substance that the Bond is a special and limited obligation of
the City payable solely out of and secured by an irrevocable
pledge of and second lien (but not necessarily exclusive
second lien) upon the Net Pledged Revenues, that the Bond does
not constitute a debt or an indebtedness of the City within
the meaning of any constitutional, Charter or statutory
provision or limitat"ion, that" the Bond is not payable in whole
or in part from the proceeds of general property taxes, and
that the full faith and credit of the City is not pledged for
the payment of the principal of or interest on the Bond.
(8) Form of Bonds. The Bonds shall be in
substantially the form set forth in Exhibit D of the Loan
Agreement.
C. Special Obligations. The Bonds, as to all Debt
Service Requirements thereof, shall be payable solely out of the
Net Pledged Revenues. The Authority may not look to the general
fund or any other fund of the City for the payment of the Debt
Service Requirements thereof, except the special funds pledged
therefor. The Bonds shall not constitute a debt or indebtedness of
the City within the meaning of any constitutional, charter or
statutory provision or limitation, and the Bonds shall not be
considered or held to be general obligations of the City but shall
constitute special and limited obligations of the City. The Bonds
are not payable in whole or in part from the proceeds of general
property taxes, and the full faith and credit of the City is not
pledged for payment of the Bonds.
Section 5. Disposition of Bond Proceeds and Income;
Funds and Accounts Adopted or Created by Ordinance; Security for
Bonds. The proceeds of the Bonds and the Income shall be deposited
by the City in the funds described in this Section 5, to be
accounted for in the manner and priority set forth in this
Section 5.
The Net Pledged Revenues and all moneys and securities
paid or to be paid to or held or to be held in any fund hereunder
are hereby pledged to secure the payment of the Debt Service
Requirements of the Prior Bonds, the Bonds and any other Parity
Securities and any Subordinate Bonds or other Subordinate
Securities as provided herein. This pledge shall be valid and
binding from and after the date of the first delivery of the Bonds,
and the moneys, as received by the City and hereby pledged, shall
immediately be subject to the lien of this pledge without any
physical delivery thereof, any filing, or further act. The lien of
this pledge and the obligation to perform the contractual
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provisions hereby made shall have priority over any or all other
obligations and liabilities of the City (except as herein otherwise
expressly provided) , and the lien of this pledge shall be valid and
binding as against all parties having claims of any kind in tort,
contract or otherwise against the City (except as herein otherwise
expressly provided) , irrespective of whether such parties have
notice thereof.
A. Project Loan Subaccount. The net proceeds of the
Bonds shall be held by the Trustee in the Project Loan Subaccount
and disbursed to the City for payment of Costs of the Project as
provided in the Loan Agreement.
B. Sewer Fund. Except as otherwise provided herein,
the entire Income, upon receipt thereof from time to time by the
City, shall be set aside and credited immediately to the Sewer
Fund. In addition, the City may at its option credit to the Sewer
Fund any other moneys of the City legally available for expenditure
for the purposes of the Sewer Fund as provided herein.
The Sewer Fund shall be administered and the moneys on
deposit therein shall be deposited and applied in the following
order of priority:
(1) First, to the Operation and Maintenance Fund to
pay Operation and Maintenance Expenses in the manner set forth
in Section 5C hereof;
(2) Second, to the Prior Bonds Principal and
Interest Fund to pay the Debt Service Requirements of the
Prior Bonds then Outstanding in the manner set forth in
Section 5D hereof;
(3) Third, to the Prior Bonds Debt Service Reserve
Fund in the manner set forth in Section 5E hereof;
(4) Fourth, to the Subsequent Bonds Principal and
Interest Fund to pay the Debt Service Requirements of the
Bonds, any Additional Parity Bonds and any other Parity
Securities then Outstanding in the manner set forth in
Section 5F hereof;
(5) Fifth, to the Subsequent Bonds Debt Service
Reserve Fund in the manner set forth in Section 5G hereof;
(6) Sixth, to the payment of the Debt Service
Requirements of Subordinate Bonds or other Subordinate
Securities in accordance with Section 5H hereof;
(7) Seventh, to the accumulation or replenishment
of the Wastewater Utility Capital Reserve in the manner set
forth in Section 5I hereof; and
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(8) Eighth, to be used in accordance with
Section 5J hereof.
C. Operation and Maintenance Fund. As a first charge
on the Sewer Fund there shall be credited from time to time to the
Operation and Maintenance Fund, Income sufficient to pay the
Operation and Maintenance Expenses of the Sewerage Facilities as
they become due and payable, and thereupon the Operation and
Maintenance Expenses shall be promptly paid.
Any surplus remaining in the Operation and Maintenance
Fund and not needed for Operation and Maintenance Expenses shall be
transferred to the Sewer Fund and used for the purposes thereof.
D. Prior Bonds Principal and Interest Fund. The City
shall deposit in the Prior Bonds Principal and Interest Fund from
the Net Pledged Revenues on or before the last day of each month
the following amounts:
(1) Interest Payments. One-sixth (1/6) of the
aggregate amount of the next installment of interest due in
the then-current Bond Year plus any other amounts due for
interest on the Prior Bonds then Outstanding.
(2) Principal Payments. One-twelfth (1/12) of the
aggregate amount of the next installment of principal due in
the then-current Bond Year plus any other amounts due for
principal of the Prior Bonds then Outstanding.
Such interest and principal shall be promptly paid when
due.
The Net Pledged Revenues credited to the Prior Bonds
Principal and Interest Fund shall be used to pay the Debt Service
Requirements of the Prior Bonds then Outstanding, as such Debt
Service Requirements become due, except as otherwise provided in
this Ordinance. The Prior Bonds Principal and Interest Fund shall
be maintained as a sinking fund for the mandatory redemption of
Prior Bonds maturing in the years 2004 and 2010. Any mandatory
sinking fund redemption shall be treated as an installment of
principal for purposes of this Section 5D.
E. Prior Bonds Debt Service Reserve Fund. Subject to
the payments required by Section 5D hereof, there shall be credited
as hereinafter provided to the Prior Bonds Debt Service Reserve
Fund from the Net Pledged Revenues moneys sufficient to accumulate
in and maintain the Prior Debt Service Reserve Fund at an amount at
least equal to the Average Annual Debt Service Requirements of all
Outstanding Prior Bonds. Said amount shall be maintained as a
continuing reserve for the payment of the Debt Service Requirements
of the Prior Bonds. No payment need be made into the Prior Bonds
Debt Service Reserve Fund so long as the moneys therein shall equal
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not less than said amount. In the event that the amount on deposit
in the Prior Bonds Debt Service Reserve Fund falls below the amount
required to be maintained therein, the City shall credit to the
Prior Bonds Debt Service Reserve Fund such Net Pledged Revenues as
may be needed to accumulate or reaccumulate the amount therein so
that at all times the amount of the Prior Bonds Debt Service
Reserve Fund equals said amount. The moneys in the Prior Bonds
Debt Service Reserve Fund shall be set aside, accumulated, and, if
necessary, reaccumulated as provided herein, from time to time, and
maintained as a continuing reserve to be used only to prevent
deficiencies in the Prior Bonds Principal and Interest Fund
resulting from failure to deposit therein sufficient sums to pay
such Debt Service Requirements of the Prior Bonds as the same
become due.
If at any time the City shall for any reason fail to pay
into the Prior Bonds Principal and Interest Fund the full amount
above stipulated, then an amount shall be paid into the Prior Bonds
Principal and Interest Fund at such time from the Prior Bonds Debt
Service Reserve Fund equal to the difference between that paid from
the Net Pledged Revenues in the Sewer Fund and the full amount so
stipulated. The money so used shall be replaced to the Prior Bonds
Debt Service Reserve Fund from the Net Pledged Revenues thereafter
received and not required to be otherwise applied by Section 5D
hereof.
If at any time the City shall for any reason fail to pay
into the Prior Bonds Debt Service Reserve Fund the full amount
stipulated herein from the Net Pledged Revenues in the Sewer Fund,
the difference between the amount paid and the amount so stipulated
shall in a like manner be paid therein from the first Net Pledged
Revenues thereafter received and not required to be applied
otherwise by Section 5D hereof.
Nothing in this ordinance shall be construed as limiting
the right of the City to substitute for the cash deposit required
to be maintained hereunder a letter of credit, surety bond,
insurance policy, agreement guaranteeing payment, or other
undertaking by a financial institution to ensure that cash in the
amount otherwise required to be maintained hereunder will be
available to the City as needed, provided that any such
substitution shall first be approved in writing by Financial
Guaranty Insurance Company and shall be submitted to Moody's
Investors Service, Inc. and Standard & Poor's Corporation and shall
not cause the then-current ratings of the Prior Bonds to be
adversely affected.
F. Subseouent Bonds Principal and Interest Fund. The
City shall deposit in the Subsequent Bonds Principal and Interest
Fund hereby created, forthwith upon receipt of the proceeds of the
Bonds, interest accrued thereon from their date of issue to the
date of delivery thereof to the Authority, to apply to the payment
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of interest first due on the Bonds. In lieu of such deposit the
City may permit the Authority to credit such accrued interest to
any fund or account maintained by the Authority to account for
payments by the City of Debt Service Requirements of the Bonds or
payments under the Loan Agreement.
After the payments required by Sections 5D and 5E hereof
for the current Bond Year have been made, the City shall deposit in
the Subsequent Bonds Principal and Interest Fund from the Net
Pledged Revenues on or before the last day of August, 1992 , or as
soon thereafter as the provisions hereof permit, the amount of
interest accruing on the Bonds during said month (with a credit for
the amount of any accrued interest, capitalized interest or
investment earnings deposited in the Subsequent Bonds Principal and
Interest Fund or credited to any fund or account maintained by the
Authority for the purposes described above or herein and not
theretofore credited) and on or before the last day of each month
beginning September, 1992, or as soon thereafter as the provisions
hereof permit, the following amounts (with a credit for the amount
of any accrued interest, capitalized interest or investment
earnings deposited in the Subsequent Bonds Principal and Interest
Fund or credited to any fund or account maintained by the Authority
for the purposes described above or herein and not theretofore
credited) :
(1) Interest Payments. One-third (1/3) of the
aggregate amount of the next installment of interest due on
the Bonds on the next Interest Payment Date in the
then-current Bond Year plus any other amounts due for interest
on the Bonds, any Additional Parity Bonds and any other Parity
Securities then Outstanding.
(2) Principal Payments. One-twelfth (1/12) of the
aggregate amount of the next installment of principal due on
the Bonds on the next Maturity Date in the then-current Bond
Year plus any other amounts due for principal of the Bonds,
any Additional Parity Bonds and any other Parity Securities
then outstanding.
Such interest and principal shall be promptly paid when
due.
The moneys credited to the Subsequent Bonds Principal and
Interest Fund shall be used to pay the Debt Service Requirements of
the Bonds, any Additional Parity Bonds and any other Parity
Securities then Outstanding, as such Debt Service Requirements
become due, except as otherwise provided in this Ordinance.
G. Subsequent Bonds Debt Service Reserve Fund. After
the payments required by Sections 5D and 5E hereof for the current
Bond Year have been made and subject to the payments required by
Section 5F hereof, there shall be credited to the Subsequent Bonds
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Debt Service Reserve Fund hereby created from the Net Pledged
Revenues moneys sufficient to accumulate in and maintain the
Subsequent Bonds Debt Service Reserve Fund at an amount at least
equal to that amount, if any, specified in any ordinance
authorizing the issuance of any Additional Parity Bonds or other
Parity Securities. Said amount shall be maintained as a continuing
reserve for the payment of the Debt Service Requirements of any
Additional Parity Bonds or other Parity Securities and, if any such
ordinance so provides, the Bonds. In the event that the amount on
deposit in the Subsequent Bonds Debt Service Reserve Fund falls
below the amount required to be maintained therein, the City shall
credit to the Subsequent Bonds Debt Service Reserve Fund such Net
Pledged Revenues as may be needed to accumulate or reaccumulate the
amount therein so that at all times the amount of the Subsequent
Bonds Debt Service Reserve Fund equals said amount. The moneys in
the Subsequent Bonds Debt Service Reserve Fund shall be set aside,
accumulated, and, if necessary, reaccumulated as provided herein,
from time to time, and maintained as a continuing reserve to be
used only to prevent deficiencies in the Subsequent Bonds Debt
Service Reserve Fund resulting from failure to deposit therein
sufficient sums to pay such Debt Service Requirements of any
Additional Parity Bonds or other Parity Securities and, if any
ordinance authorizing the issuance of any Additional Parity Bonds
or other Parity Securities so provides, the Bonds as the same
become due.
If at any time the City shall for any reason fail to pay
into the Subsequent Bonds Principal and Interest Fund the full
amount above stipulated, then an amount shall be paid into the
Subsequent Bonds Principal and Interest Fund at such time from the
Subsequent Bonds Debt Service Reserve Fund equal to the difference
between that paid from the Net Pledged Revenues in the Sewer Fund
and the full amount so stipulated. The money so used shall be
replaced to the Subsequent Bonds Debt Service Reserve Fund
thereafter received and not required to be otherwise applied by
Sections 5D through 5F hereof.
If at any time the City shall for any reason fail to pay
into the Subsequent Bonds Debt Service Reserve Fund the full amount
stipulated herein from the Net Pledged Revenues in the Sewer Fund,
the difference between the amount paid and the amount so stipulated
shall in a like manner be paid therein from the first Net Pledged
Revenues thereafter received and not required to be applied
otherwise by Sections 5D through 5F hereof.
H. Payment of Subordinate Securities. After the
payments required by Sections 5D and 5E hereof for the current Bond
Year have been made and subject to the payments required by
Sections 5F and 5G hereof, any remaining Net Pledged Revenues may
be used by the City for the payment of Debt Service Requirements of
Subordinate Securities payable from the Net Pledged Revenues and
authorized to be issued in accordance with this Ordinance,
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including reasonable reserves for such Subordinate Securities; but
the lien of such Subordinate Securities on the Net Pledged Revenues
and the pledge thereof for the payment of such Subordinate
Securities shall be subordinate to the lien and pledge of the
Bonds, any Additional Parity Bonds and any other Parity Securities
as herein provided.
I. Wastewater Utility Capital Reserve. The City shall,
so long as any of the Prior Bonds remain Outstanding, maintain in
the Wastewater Utility Capital Reserve an amount at least equal to
25% of the Operation and Maintenance Expenses budgeted for the
then-current Fiscal Year and shall, after the redemption or
defeasance of the Prior Bonds and so long as any Debt Service
Requirements of the Bonds or amounts due under the Loan Agreement
remain unpaid, maintain in the Wastewater Utility Capital Reserve
an amount at least equal to 17% of the Operation and Maintenance
Expenses budgeted for the then-current Fiscal Year. Said amounts
shall be maintained as a continuing reserve for payment of costs of
necessary capital improvements to the Sewerage Facilities and,
subject to the foregoing, may be expended in the sole discretion of
the City.
If moneys in the Wastewater Utility Capital Reserve are
expended so that the amount therein is less than the minimum amount
required hereby, any deficiency shall, after the payments required
by Sections 5D and 5E hereof for the current Bond Year have been
made and subject to the payments required or permitted by Sections
5F through 5H hereof, be replenished over a period not exceeding
twenty-four (24) months in substantially equal monthly
installments. No payment need be made into the Wastewater Utility
Capital Reserve so long as the moneys therein shall equal not less
than the amount required hereby.
J. Use of Remaining Revenues. After the payments
required by Sections 5D and 5E hereof have been made in any Bond
Year and subject to the payments required or permitted by Sections
5F through 5I hereof, any remaining Net Pledged Revenues may be
used for any one or any combination of lawful purposes as provided
in Art. XII, Section 6 of the Charter.
K. Termination of Deposits. No payment need be made
into the Prior Bonds Principal and Interest Fund or the Prior Bonds
Debt Service Reserve Fund if the amount in the Prior Bonds
Principal and Interest Fund and the amount in the Prior Bonds Debt
Service Reserve Fund is at least equal to the entire amount of the
Outstanding Prior Bonds, as to all Debt Service Requirements, to
their respective Maturity Dates or to any Redemption Dates on which
the City shall have exercised or shall have obligated itself to
exercise its option to redeem,. prior to their respective Maturity
Dates, any Prior Bonds then Outstanding and thereafter maturing
(provided that, solely for the purpose of this Section 5K, there
shall be deemed to be a credit to the Prior Bonds Debt Service
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Reserve Fund moneys, Federal Securities and bank deposits, or any
combination thereof, accounted for in any other fund or account of
the City and restricted solely for the purpose of paying the Debt
Service Requirements of the Prior Bonds, in which case moneys in
the Prior Bonds Principal and Interest Fund and the Prior Bonds
Debt Service Reserve Fund in an amount, except for any known
interest or other gain to accrue from any investment or deposit of
moneys pursuant to Section 6B hereof from the time of any such
investment or deposit to the time or respective times the proceeds
of any such investment or deposit shall be needed for such payment,
at least equal to such Debt Service Requirements, shall be used
together with any such gain from such investments and deposits
solely to pay such Debt Service Requirements as the same become
due.
No payment need be made into the Subsequent Bonds
Principal and Interest Fund or the Subsequent Bonds Debt Service
Reserve Fund if the amount in the Subsequent Bonds Principal and
Interest Fund and the Subsequent Bonds Debt Service Reserve Fund is
at least equal to the entire amount of the Outstanding Bonds and
any Outstanding Additional Parity Bonds and Parity Securities, as
to all Debt Service Requirements, to their respective Maturity
Dates or to any Redemption Dates on which the City shall have
exercised or shall have obligated itself to exercise its option to
redeem, prior to their respective Maturity Dates, any Bonds, any
Additional Parity Bonds and any other Parity Securities then
Outstanding and thereafter maturing (provided that, solely for the
purpose of this Section 5K, there shall be deemed to be a credit to
the Subsequent Bonds Principal and Interest Fund moneys, Federal
Securities and bank deposits, or any combination thereof, accounted
for in any other fund or account of the City and restricted solely
for the purpose of paying the Debt Service Requirements of the
Bonds, any Additional Parity Bonds or any other Parity Securities) ,
in which case moneys in the Subsequent Bonds Principal and Interest
Fund in an amount, except for any known interest or other gain to
accrue from any investment or deposit of moneys pursuant to
Section 6B hereof from the time of any such investment or deposit
to the time or respective times the proceeds of any such investment
or deposit shall be needed for such payment, at least equal to such
Debt Service Requirements, shall be used together with any such
gain from such investments and deposits solely to pay such Debt
Service Requirements as the same become due.
L. Budget and Appropriation of Sums. The sums required
to pay the Costs of the Project are hereby appropriated for said
purpose. The sums required to make the payments specified in this
Section 5 are hereby appropriated for said purposes. Said amounts
for each year shall be included in the annual budget and the
appropriation ordinance or measures to be adopted or passed by the
Council in each year respectively while the Bonds, either as to
principal or interest, are Outstanding and unpaid. No provisions
of any constitution, charter, statute, ordinance, resolution, or
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other order or measure enacted after the issuance of the Bonds
shall in any manner be construed as limiting or impairing the
obligation of the City to keep and perform the covenants contained
in this Ordinance so long as any of the Bonds remain Outstanding
and unpaid. Nothing herein shall prohibit the Council from
appropriating other funds of the City legally available for this
purpose to the Sewer Fund for the purposes thereof.
Section 6. General Administration of Funds.
A. Places and Times of Deposits. Each of the special
funds created or'- adopted in Section 5 hereof shall be maintained in
a Commercial Bank kept separate and apart from all other accounts
or funds of the City as trust accounts solely for the purposes
herein designated therefor. For purposes of investment of moneys,
nothing herein prevents the commingling of moneys accounted for in
any two or more such accounts or funds pertaining to the Income.
Such accounts or funds shall be continuously secured to the fullest
extent required or permitted by the laws of the State for the
securing of public funds and shall be irrevocable and not
withdrawable by anyone for any purpose other than the respective
designated purposes of such accounts or funds. Each periodic
payment shall be credited to the proper account or fund not later
than the date therefor herein designated, except that when any such
date shall be a Saturday, a Sunday or a legal holiday, then such
payment shall be made on or before the next preceding business day.
B. Investment of Funds. Any moneys in any fund
established in Section 5 hereof may be invested, reinvested or
deposited only in Permitted Investments. Investments shall either
be subject to redemption at any time at face value by the Owner
thereof at the option of such Owner or shall mature at such time or
times as shall most nearly coincide with the expected need for
moneys from the fund in question. Investments so purchased in any
such fund shall be deemed at all times to be a part of the
applicable fund; provided that with the exception of the Prior
Bonds Debt Service Reserve Fund the interest accruing on such
investments and any profit realized therefrom shall be credited to
the Sewer Fund, and any loss resulting from such investments shall
be charged to the particular fund in question. Interest and profit
realized from investments in the Prior Bonds Debt Service Reserve
Fund shall be credited to the Prior Bonds Debt Service Reserve
Fund, provided that, so long as the amount in the Prior Bonds Debt
Service Reserve Fund equals at least the amount specified in
Section 5E hereof, such interest and profit may be transferred to
the Prior Bonds Principal and Interest Fund and distributed in the
same manner as other moneys in the Prior Bonds Principal and
Interest Fund. Any loss resulting from such investments in the
Prior Bonds Debt Service Reserve Fund shall be charged to the Prior
Bonds Debt Service Reserve Fund. Investments in the Prior Bonds
Debt Service Reserve Fund shall be valued by the Financial Officer
as frequently as deemed necessary by Financial Guaranty Insurance
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Company, but not less often than quarterly, at the market value
thereof. If on any valuation date the market value of investments
in the Prior Bonds Debt Service Reserve Fund is less than the
amount required by Section 5E hereof to be maintained therein due
to market fluctuations, the deficiency shall be remedied no later
than the next quarterly valuation date. The City shall present for
redemption or sale on the prevailing market any securities or
obligations so purchased as an investment of moneys in a given fund
whenever it shall be necessary to do so in order to provide moneys
to meet any required payment or transfer from such fund.
C. No Liability for Losses Incurred in Performing Terms
of Ordinance. Neither the City nor any officer of the City shall
be liable or responsible for any loss resulting from any investment
or reinvestment made in accordance with this Ordinance.
D. Character of Funds. The moneys in any fund herein
authorized shall consist of lawful money of the United States of
America or Permitted Investments or both such money and Permitted
Investments. Moneys deposited in a demand or time deposit account
in a Commercial Bank, appropriately secured according to the laws
of the State, shall be deemed lawful money of the United States of
America.
E. Accelerated Payments Optional. Nothing contained
herein prevents the accumulation in any fund herein designated of
any monetary requirements at a faster rate than the rate or minimum
rate, as the case may be, provided therefor, but no payment shall
be so accelerated if such acceleration shall cause a default in the
payment of any obligation of the City pertaining to the Income.
Section 7 . Priorities; Liens: Issuance of Additional
Bonds.
A. Liens on Net Pledged Revenues; Eauality of Bonds.
Additional Parity Bonds and Other Parity Securities. Except as
expressly provided in Ordinance No. 98, 1986, with respect to the
Prior Bonds and in this Ordinance with respect to Additional Parity
Bonds, Parity Securities and Subordinate Securities, the Net
Pledged Revenues shall be and hereby are irrevocably pledged and
set aside to pay the Debt Service Requirements of the Bonds.
The Prior Bonds constitute an irrevocable and first lien
upon the Net Pledged Revenues. The Bonds constitute an irrevocable
and second lien (but not necessarily an exclusive second lien) upon
the Net Pledged Revenues.
The Bonds, any Additional Parity Bonds and any other
Parity Securities hereafter authorized to be issued and from time
to time Outstanding are equitably and ratably secured by a lien on
the Net Pledged Revenues and shall not be entitled to any priority
one over the other in the application of the Net Pledged Revenues
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regardless of the time or times of the issuance thereof, it being
the intention of the Council that there shall be no priority among
the Bonds, any Additional Parity Bonds and any other Parity
Securities, regardless of the fact that they may be actually issued
and delivered at different times.
B. Issuance of Additional Parity Bonds. Nothing
herein, subject to the limitations stated in Section 7F hereof,
prevents the issuance by the City of Additional Parity Bonds
payable from the Net Pledged Revenues and constituting a lien on
the Net Pledged Revenues on a parity with, but not prior or
superior to, the lien thereon of the Bonds; but before any such
Additional Parity Bonds are authorized or actually issued the City
shall satisfy the conditions set forth in the Loan Agreement.
C. Certification of Revenues. Where certifications of
revenues are required by this Ordinance or the Loan Agreement, the
specified and required written certifications of the Financial
Officer of the City that revenues are sufficient to pay the
required amounts shall be conclusively presumed to be accurate in
determining the right of the City to authorize, issue, sell and
deliver Additional Parity Bonds.
D. Subordinate Securities Permitted. Nothing herein,
subject to the limitations stated in Section 7F hereof, prevents
the City from issuing Subordinate Securities for any lawful
purpose.
E. Superior Securities Prohibited. The City has
heretofore issued the Prior Bonds. The City shall not issue any
additional Superior Bonds or Superior Securities.
F. Supplemental Ordinances. Additional Parity Bonds or
Subordinate Securities shall be issued only after authorization
thereof by ordinance, supplemental ordinance or other instrument of
the Council, stating the purpose or purposes of the issuance of
such additional securities, directing the application of the
proceeds thereof to such purpose or purposes, directing the
execution thereof, and fixing and determining the date, series
designation, principal amount, maturity or maturities, maximum rate
or rates of interest, and prior redemption privileges of the City
with respect thereto, and providing for payments to and from the
Sewer Fund in accordance with this Ordinance. All additional
securities shall bear such date, shall be payable as to principal
on December 1 and as to interest on June 1 and December 1 and shall
be subject to redemption prior to maturity on such terms and
conditions, as may be provided, and shall bear interest at such
rate or rates as may be fixed by ordinance, instrument or other
document of the Council. Nothing herein shall be construed to
prohibit the issuance of additional securities payable from the Net
Pledged Revenues, the interest on which is payable more frequently
than semiannually.
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Section 8. Covenants.
The City hereby incorporates by this reference all the
covenants and agreements contained in the Loan Agreement and
further covenants until the Bonds have been fully paid and
discharged as follows:
A. Rate Maintenance. The City shall prescribe, revise,
and collect rates, fees, tolls, and charges and tap fees and plant
investment fees, or any combination thereof, which may be imposed
by the City whether for the direct or indirect connection with or
the use of the Sewerage Facilities and reasonable penalties for any
delinquencies, which shall produce Income sufficient, together with
any other moneys legally available therefor and credited to the
Sewer Fund, to make the payments and accumulations required by this
Ordinance, and which shall produce Net Pledged Revenues sufficient,
together with all other moneys legally available therefor and
credited to the Sewer Fund after payment of Operation and
Maintenance Expenses, to pay the amounts specified in paragraph (5)
of Exhibit A of the Loan Agreement.
In the event that such rates, fees, tolls, and charges
and tap fees and plant investment fees at any time should not be
sufficient to make all of the payments and accumulations required
by this Ordinance, the Council shall increase its rates, fees,
tolls, and charges and tap fees and plant investment fees to such
extent as to insure the payments and accumulations required by the
provisions of this Ordinance.
B. Collection of Charges. The City shall cause all
rates, fees, tolls, and charges and tap fees and plant investment
fees pertaining to the Sewerage Facilities to be billed promptly
and collected as soon as reasonable, shall prescribe and enforce
rules and regulations or impose contractual obligations for , the
payment thereof, to the end that the Net Pledged Revenues shall be
adequate to meet the requirements of this Ordinance and any other
ordinance or instrument supplemental thereto. The rates, fees,
tolls, and charges and tap fees and plant investment fees due shall
be collected in any lawful manner.
C. Competent Management. The City shall employ
experienced and competent management personnel for each component
of the Sewerage Facilities. If the City shall fail to pay the Debt
Service Requirements of the Bonds promptly as the same become due,
or if the City shall fail to keep any of the covenants herein
contained, and if such default shall continue for a period of sixty
(60) days, or if the Net Pledged Revenues of the Sewerage
Facilities in any Fiscal Year, together with other legally
available revenue and money, shall fail to equal at least the
amount of the Debt Service Requirements of the Bonds, and other
obligations payable from the Net Pledged Revenues due in the
Comparable Bond Year, the City shall retain a firm of competent
21
management Persons skilled in the operation of sewerage facilities
to assist in the management of the Sewerage Facilities so long as
such default continues or the said revenues, proceeds and income
are less than the amount hereinabove designated.
D. Performance of Duties. The City, acting by and
through its officers, or otherwise, shall faithfully and punctually
perform, or cause to be performed, all duties with respect to the
Income and the Sewerage Facilities required by the Constitution and
laws of the State and the ordinances, resolutions and contracts of
the City, including, without limitation, the proper segregation of
the proceeds of the Bonds and the Income and their application from
time to time to the respective funds provided therefor.
E. Costs of Bond Issue and of Performance. Except as
otherwise specifically provided herein, all costs and expenses
incurred in connection with the issuance of the Bonds, payment of
the Debt Service Requirements thereof, or the City's performance of
or compliance with any covenant or agreement contained in this
Ordinance or in the Loan Agreement shall be paid exclusively (but
only from the appropriate special fund in the manner authorized
herein) from the proceeds of the Bonds, from the Net Pledged
Revenues, or from other legally available moneys, and in no event
shall any of such costs or expenses be required to be paid out of
or charged to the general fund of the City.
F. Contractual Obligations. The City will perform all
contractual obligations undertaken by it under the Loan Agreement
and any other agreements relating to the Bonds, the Income, or the
Sewerage Facilities.
G. Further Assurances. At any and all times the City
shall, so far as it may be authorized by law, pass, make, do,
execute, acknowledge, deliver, and file or record all and every
such further instruments, acts, deeds, conveyances, assignments,
transfers, other documents, and assurances as may be necessary or
desirable for the better assuring, conveying, granting, assigning
and confirming all and singular the rights, the Net Pledged
Revenues and other funds hereby pledged, or intended so to be, or
which the City may hereafter become bound to pledge, or as may be
reasonable and required to carry out the purposes of this
Ordinance. The City, acting by and through its officers, or
otherwise, shall at all times, to the extent permitted by law,
defend, preserve and protect the pledge of the Net Pledged Revenues
and other funds pledged hereunder and all the rights of the
Authority against all claims and demands of all Persons whomsoever.
H. Conditions Precedent. Upon the date of issuance of
any of the Bonds, all conditions, acts and things required by the
Constitution or laws of the United States of America, the
Constitution or laws of the State, the Charter, and this Ordinance
to exist, to have happened, and to have been performed precedent to
22
or in the issuance of the Bonds shall exist, have happened and have
been performed, and the Bonds, together with all other obligations
of the City, shall not contravene any debt or other limitation
prescribed by the Constitution or laws of the United States of
America or the Constitution or laws of the State or the Charter.
I. Efficient Operation and Maintenance. The City shall
at all times operate the Sewerage Facilities properly and in a
sound and economical manner. The City shall maintain, preserve and
keep the Sewerage Facilities properly or cause the same so to be
maintained, preserved, and kept, with the appurtenances and every
part and parcel thereof in good repair, working order and
condition, and shall from time to time make or cause to be made all
necessary and proper repairs, replacements and renewals so that at
all times the maintenance of the Sewerage Facilities may be
properly and advantageously conducted. All salaries, fees, wages
and other compensation paid by the City in connection with the
repair, maintenance and operation of the Sewerage Facilities shall
be fair and reasonable.
J. Records and Accounts. The City will keep proper
books of record and account, separate and apart from all other
records and accounts, showing complete and correct entries of all
transactions relating to the funds referred to herein.
K. Rules Regulations and Other Details. The City,
acting by and through its officers, shall establish and enforce
reasonable rules and regulations governing the construction,
operation, care, repair, maintenance, management, control, use and
services of the Sewerage Facilities. The City shall observe and
perform all of the terms and conditions contained in this Ordinance
and shall comply with all valid acts, rules, regulations, orders
and directives of any legislative, executive, administrative or
judicial body applicable to the Sewerage Facilities or the City.
L. payment of Governmental Charges. The City shall pay
or cause to be paid all taxes and assessments or other municipal or
governmental charges, if any, lawfully levied or assessed upon or
in respect of the Sewerage Facilities or upon any part thereof or
upon any portion of the Income, when the same shall become due, and
shall duly observe and comply with all valid requirements of any
municipal or governmental authority relative to the Sewerage
Facilities, or any part thereof, except for any period during which
the same are being contested in good faith by proper legal
proceedings. The City shall not create or suffer to be created any
lien or charge upon the Sewerage Facilities, or any part thereof,
or upon the Income, except the pledge and lien created by this
Ordinance for the payment of the Debt Service Requirements due in
connection with the Bonds and except as herein otherwise permitted.
The City shall pay or cause to be discharged or shall make adequate
provision to satisfy and to discharge, within ninety (90) days
after the same shall become payable, all lawful claims and demands
23
for labor, materials, supplies or other objects which, if unpaid,
might by law become a lien upon the Sewerage Facilities, or any
part thereof, or the Income, but nothing herein requires the City
to pay or to cause to be discharged or to make provision for any
such tax, assessment, lien or charge, so long as the validity
thereof is contested in good faith and by appropriate legal
proceedings.
M. Protection of Security. The City, its officers,
agents and employees, shall not take any action in such manner or
to such extent as might prejudice the security for the payment of
the Debt Service Requirements of the Bonds and any other securities
payable from the Net Pledged -Revenues according to the terms
thereof. No contract shall be entered into nor any other action
taken by which the rights of any Owner of any Bonds or other
security payable from Net Pledged Revenues might be prejudicially
and materially impaired or diminished.
N. Accumulation of Interest Claims. In order to
prevent any accumulation of claims for interest after maturity, the
City shall not directly or indirectly extend or assent to the
extension of the time for the payment of any claim for interest on
any of the Bonds or any other securities payable from the Net
Pledged Revenues; and the City shall not directly or indirectly be
a party to or approve any arrangements for any such extension or
for the purpose of keeping alive any of such claims for interest.
If the time for the payment of any such installment of interest is
extended in contravention of the foregoing provisions, such
installment or installments of interest after such extension or
arrangement shall not be entitled in case of default hereunder to
the benefit or the security of this Ordinance, except upon the
prior payment in full of the principal of all of the Bonds and any
such securities the payment of which has not been extended.
O. Prompt Payment of Bonds. The City shall promptly
pay the Debt Service Requirements of every Bond at the places, on
the dates, and in the manner specified herein and in the Bonds
according to the true intent and meaning hereof.
P. Use of Funds. The Prior Bonds Principal and
Interest Fund, the Prior Bonds Debt Service Reserve Fund and the
Subsequent Bonds Principal and Interest Fund and the Subsequent
Bonds Debt Service Reserve Fund shall be used solely and only, and
the moneys credited to such funds are hereby pledged, for the
purpose of paying the Debt Service Requirements of the Prior Bonds,
the Bonds, any Additional Parity Bonds and any other Parity
Securities at maturity or upon prior redemption, subject to Section
9 hereof.
Q. Additional Securities. The City shall not hereafter
issue any bonds or securities relating to the Sewerage Facilities
and payable from the Net Pledged Revenues without compliance with
24
the requirements with respect to the issuance of Additional Parity
Bonds or other securities set forth herein to the extent
applicable.
R. Other Liens. Other than as provided herein, there
are no liens or encumbrances of any nature whatsoever on or against
the Sewerage Facilities, or any part thereof, or on or against the
Net Pledged Revenues.
S. Surety Bonds. Each official or other person having
custody of any Net Pledged Revenues or responsible for their
handling shall be fully bonded at all times, which bond shall be
conditioned upon the proper application of said moneys. The cost
of each such bond shall be considered an Operation and Maintenance
Expense, unless otherwise provided by law.
T. Disposal of Sewerage Facilities Prohibited. Subject
to Section 8U hereof, except for the use of the Sewerage Facilities
and services pertaining thereto in the normal course of business,
neither all nor a substantial part of the Sewerage Facilities shall
be sold, mortgaged, pledged, encumbered, alienated or otherwise
disposed of, until all of the Bonds have been paid in full, as to
all Debt Service Requirements thereof, or unless provision has been
made therefor, or until the Bonds have otherwise been redeemed,
including, without limitation, the termination of the pledge as
herein authorized. Subject to Section 8U hereof, the City shall
not dispose of its title to the Sewerage Facilities or to any
material Income-producing part thereof, including any property
necessary to the operation and use of the Sewerage Facilities and
the lands and interests in lands comprising the Sewerage
Facilities.
U. Disposal of Property. No material Income-producing
part of the Sewerage Facilities shall be sold, leased, mortgaged,
pledged, encumbered or otherwise disposed of or otherwise
alienated, until all of the Bonds have been paid in full, or unless
provision has been made therefor, or until the Bonds have otherwise
been redeemed; provided, however, that the City may sell, exchange
or lease at any time and from time to time any property or
facilities constituting part of the Sewerage Facilities and not
useful in the construction, reconstruction or operation thereof;
but any proceeds of any such sale or exchange received and not used
to replace such property so sold or exchanged shall be deposited in
the Sewer Fund, and any proceeds of any such lease received shall
be deposited by the City as revenues of the Sewerage Facilities.
V. Loss from Condemnation. If any part of the Sewerage
Facilities is taken by the exercise of a power of eminent domain,
the amount of any award received by the City as a result of such
taking shall be expended upon the improvement of the Sewerage
Facilities or shall be applied to the redemption of the outstanding
Prior Bonds in accordance with the provisions of Ordinance No. 98,
25
1986, the outstanding Bonds, any Outstanding Additional Parity
Bonds and any Outstanding Parity Securities in accordance with the
provisions hereof and of any other instrument pertaining to the
issuance of any such Additional Parity Bonds or Parity Securities
any Outstanding Subordinate Bonds or Subordinate Securities in
accordance with any instrument pertaining to the issuance of such
Subordinate Bonds or Subordinate Securities at maturity or upon
prior redemption if the authorizing ordinances authorize the prior
redemption of such securities.
W. Inspection of Records. The Authority and any Owner
of any securities payable from the Net Pledged Revenues, any duly
authorized agent or agents of the Authority or such Owner, shall
have the right at all reasonable times to inspect all records,
accounts and data relating thereto, concerning the Sewerage
Facilities or the Income, to make copies of such records, accounts
and data at the Authority's or Owner's expense, and to inspect the
Sewerage Facilities and properties comprising the Sewerage
Facilities.
X. Audits Required. The City, annually following the
close of each Fiscal Year, shall order an audit for the Fiscal Year
of the books and accounts pertaining to the Sewerage Facilities to
be made forthwith by an independent accountant, and order an audit
report showing the receipts and disbursements for each fund or
account pertaining to the Sewerage Facilities or the Income. All
expenses incurred in the making of the audits and reports required
by this subsection shall be regarded and paid as an Operation and
Maintenance Expense.
Y. Insurance and Reconstruction. The City shall at all
times maintain with responsible insurers all such insurance
reasonably required and obtainable within limits and at costs
deemed reasonable by the City as is customarily maintained with
respect to sewerage facilities of like character against loss of or
damage to the Sewerage Facilities and against public and other
liability to the extent at least reasonably necessary to protect
the interest of the City and of each Owner of Bonds or any other
securities payable from the Net Pledged Revenues, except as herein
otherwise provided. If any useful part of the Sewerage Facilities
shall be damaged or destroyed, the City shall, as expeditiously as
possible, commence and diligently proceed with the repair or
replacement of the damaged or destroyed property so as to restore
the same to use. The proceeds of any insurance appertaining to the
Sewerage Facilities shall be payable to the City and (except for
proceeds of use and occupancy insurance) shall be applied to the
necessary costs involved in such repair and replacement, and to the
extent not so applied shall (together with the proceeds of any such
use and occupancy insurance) be deposited in the Sewer Fund as
Income. If the costs of such repair and replacement of the damaged
or destroyed property exceed the proceeds of such property
insurance available for payment of the same, moneys in the Sewer
26
Fund shall be used to the extent necessary for such purpose, as
permitted by Section 5H hereof.
Section 9 . Defeasance.
When all Debt Service Requirements of the Bonds have been
duly paid, the pledge and lien and all obligations hereunder shall
thereby be discharged and the Bonds shall no longer be deemed to be
Outstanding within the meaning of this Ordinance. There shall be
deemed to be such due payment when the City has prepaid in whole
all of its obligations under the Loan Agreement.
Section 10. Default Provisions and Remedies of Bond
Owners.
A. Events of Default. Each of the events described in
Section 5. 01 of the Loan Agreement is hereby declared to be and to
constitute an Event of Default hereunder.
B. Remedies for Defaults. Upon the happening and
continuance of any Event of Default, the Authority may proceed
against the City to protect and to enforce its rights under this
Ordinance or the Loan Agreement as provided in the Loan Agreement
or by mandatory injunction or by other suit, action, or special
proceedings in equity or at law, in any court of competent
jurisdiction, either for the appointment of a receiver or an
operating trustee or for the specific performance of any covenant
or agreement contained herein or in the Loan Agreement or for any
proper legal or equitable remedy as the Authority may deem most
effectual to protect and to enforce the rights aforesaid, or
thereby to enjoin any act or thing which may be unlawful or in
violation of any right of any Owner of any Bond, or to require the
City to act as if it were the trustee of an expressed trust, or any
combination of such remedies, or as otherwise may be authorized by
any statute or other provision of law. All such proceedings at
law or in equity shall be instituted, had and maintained for the
equal benefit of the Authority and all Owners of any Additional
Parity Bonds or other Parity Securities then Outstanding. Any
receiver or operating trustee appointed in any proceedings to
protect the rights of the Authority and such Owners hereunder may
collect, receive and apply all Income arising after the appointment
of such receiver or operating trustee in the same manner as the
City itself might do. The consent to any such appointment is
hereby expressly granted by the City.
C. Rights and Privileges Cumulative. The failure of
the Authority to proceed in any manner herein provided shall not
relieve the City or any of its officers, agents or employees of any
liability for failure to perform to carry out any duty, obligation
or other commitment. Each right or privilege of the Authority is
in addition and is cumulative to any other right or privilege, and
the exercise of any right or privilege by or on behalf of the
27
Authority shall not be deemed a waiver of any other right or
privilege of the Authority. The Authority shall be entitled to all
of the privileges, rights and remedies provided or permitted in
this Ordinance or the Loan Agreement and as otherwise provided or
permitted by law or in equity or by statute, except as provided in
Sections 12A and 12B hereof, and subject to the applicable
provisions concerning the Income and the proceeds of the Bonds.
Nothing herein affects or impairs the right of the Authority to
enforce the payment of the Debt Service Requirements due in
connection with the Bonds or the obligation of the City to pay the
Debt Service Requirements of the Bonds at the time and-
theplace
expressed herein or in the Loan Agreement or the Bonds.
D. Duties Upon Default. Upon the happening of any
Event of Default, the City, in addition, will do and perform all
proper acts on behalf of and for the Authority to protect and to
preserve the security created for the payment of the Bonds and to
insure the payment of the Debt Service Requirements of the Bonds
promptly as the same become due. If the City fails or refuses to
proceed as in this Section 10D provided, the Authority, after
demand in writing, may proceed to protect and to enforce its rights
as hereinabove provided; and to that end the Authority shall be
subrogated to all rights of the City under any agreement or
contract involving the Net Pledged Revenues entered into prior to
the effective date of this Ordinance or thereafter while any of the
Bonds are Outstanding. Nothing herein requires the City to proceed
as provided herein if it determines in good faith and without any
abuse of its discretion that if it so proceeds it is more likely
than not to incur a net loss rather than a net gain or such action
is likely to affect materially and prejudicially the Authority and
the Owners of any Outstanding Parity Securities.
Section 11. Amendment of Ordinance.
A. Amendment of Ordinance Not Requiring Consent of the
Authority. The City may, without the consent of, or notice to, the
Authority, adopt such ordinances supplemental hereto (which
amendments shall thereafter form a part hereof) for any one or more
or all of the following purposes:
(1) To cure or correct any formal defect, ambiguity
or inconsistent provision contained in this Ordinance;
(2) To designate a trustee for the Owners of the
Bonds, to transfer custody and control of the Income to such
trustee, and to provide for the rights and obligations of such
trustee;
(3) To add to the covenants and agreements of the
City or the limitations and restrictions on the City set forth
herein;
28
(4) To pledge additional revenues, properties or
collateral to the payment of the Bonds;
(5) To cause this Ordinance to comply with the
Trust Indenture Act of 1939, as amended from time to time; or
(6) To effect any such other changes hereto which
do not in the opinion of nationally recognized bond counsel
materially adversely affect the interests of the Owners of the
Bonds.
B. Amendment of Ordinance Reguiring Consent of the
Authority. Exclusive of the amendatory ordinances covered by
Section 11A hereof, this Ordinance may be amended or modified by
ordinances or other instruments duly adopted by the Council,
without receipt by it of any additional consideration, but with the
written consent of the Authority, provided that no such amendatory
ordinance shall permit:
(1) Increased or Accelerated Payment. An increase
in the amounts payable on any Maturity Date or Interest
Payment Date or an acceleration of the time for payment of
such amounts; or
(2) Prior Lien. The creation of a lien upon or a
pledge of revenues ranking prior to the lien or to the pledge
created by this Ordinance; or
(3) Priorities Among Bonds and Parity Securities.
The establishment of priorities as among Bonds and other
Parity Securities.
C. Unanimous Consent. Notwithstanding anything in the
foregoing provisions contained, the terms and the provisions of
this Ordinance, or of any ordinance or instrument amendatory
thereof, and the rights and the obligations of the City and of the
Authority and the Owners of any Additional Parity Bonds or other
Parity Securities may be modified or amended in any respect upon
the adoption by the City and upon the filing with the City Clerk of
an instrument to that effect and with the consent of the Authority
and the Owners of all the then Outstanding Additional Parity Bonds
or other Parity Securities.
D. Notation on Bonds. After the effective date of any
action taken as provided in Section 11B hereof, new Bonds so
modified as in the opinion of the Council to conform to such action
shall be prepared, executed and delivered and, upon demand of the
City or the Authority, shall be exchanged without cost for Bonds
then Outstanding upon surrender of such Outstanding Bonds.
29
Section 12 . Miscellaneous.
A. Character of Agreement. None of the covenants,
agreements, representations, or warranties contained herein or in
the Bonds shall ever impose or shall be construed as imposing any
liability, obligation, or charge against the City (except for the
special funds pledged therefor) or against the general credit of
the City payable out of general funds or out of any funds derived
from general property taxes.
B. No Pledge of Property. The payment of the Bonds is
not secured by an encumbrance, mortgage or other pledge of property
of the City except for the Net Pledged Revenues. No property of
the City, subject to such exception with respect to the Net Pledged
Revenues, pledged for the payment of the Bonds, shall be liable to
be forfeited or taken in payment of the Bonds.
C. Statute of Limitations. No action or suit based
upon any Bond or other obligation of the City shall be commenced
after it is barred by any statute of limitations pertaining
thereto. Any moneys from whatever source derived remaining in any
fund or account reserved, pledged or otherwise held for the payment
of any such obligation, action or suit, the collection of which has
been barred, shall revert to the Sewer Fund. Nothing herein
prevents the payment of the Bonds or other obligation after an
action or suit for its collection has been barred if the Council
deems it in the best interests of the City or the public so to do
and orders such payment to be made.
D. Delegated Duties. The officers of the City are
hereby authorized and directed to enter into such agreements and
take all action necessary or appropriate to effectuate the
provisions of this Ordinance and to comply with the requirements of
law, including, without limitation:
(1) Preparation of Bonds. The preparation of
typewritten Bonds in the form specified in Exhibit D of the
Loan Agreement;
(2) Execution Registration and Delivery of Bonds.
The execution and registration of the Bonds and the delivery
of the Bonds to the Authority pursuant to the provisions of
this Ordinance;
(3) Information. The assembly and dissemination to
the Authority of financial and other information concerning
the City and the Bonds;
(4) Closing Certificates. The execution of such
certificates as may be reasonably required by the Authority,
relating, inter alia, to:
30
(a) The signing of the Bonds;
(b) The tenure and identity of the officials
of the City;
(c) If in accordance with fact, the absence of
litigation, pending or threatened, affecting the validity
of the Bonds;
(d) The delivery of the Bonds and the receipt
of the Bond proceeds; and
(e) the use of the Bond proceeds and the
investment thereof pending such use.
E. Successors. Whenever herein the City is named or is
referred to, such provision shall be deemed to include any
successors of the City, whether so expressed or not. All of the
covenants, stipulations, obligations and agreements by or on behalf
of and other provisions for the benefit of the City contained
herein shall bind and inure to the benefit of any officer, board,
district, commission, authority, agency, instrumentality or other
Person or Persons to whom or to which there shall be transferred by
or in accordance with law any right, power or duty of the City or
of its respective successors, if any, the possession of which is
necessary or appropriate in order to comply with any such
covenants, stipulations, obligations, agreements or other
provisions hereof.
F. Rights and Immunities. Except as herein otherwise
expressly provided, nothing herein expressed or implied is intended
or shall be construed to confer upon or to give to any Person,
other than the City and the Authority, any right, remedy or claim
under or by reason hereof or any covenant, condition or stipulation
hereof. All the covenants, stipulations, promises and agreements
herein contained by and on behalf of the City shall be for the sole
and exclusive benefit of the City and the Authority.
No recourse shall be had for the payment of the Debt
Service Requirements of the Bonds or for any claim based thereon or
otherwise upon this Ordinance authorizing their issuance or any
other ordinance or instrument pertaining thereto, against any
individual member of the Council, or any officer or other agent of
the City, past, present or future, either directly or indirectly
through the City, or otherwise, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any
penalty or otherwise, all such liability, if any, being by the
acceptance of the Bonds and as a part of the consideration of their
issuance specially waived and released.
G. Ordinance Irrepealable. This Ordinance is, and
shall constitute, a legislative measure of the City and after any
31
of the Bonds are issued, this Ordinance shall constitute an
irrevocable contract between the City and the Owner or Owners of
the Bonds; and this Ordinance, subject to the provisions of
Sections 9 and 11 hereof, if any Bonds are in fact issued, shall be
and shall remain irrepealable until the Bonds, as to all Debt
Service Requirements, shall be fully paid, cancelled and
discharged, as herein provided.
H. Ratification. All action not inconsistent with the
provisions of this Ordinance heretofore taken by the City or its
officers, and otherwise by the City directed toward the issuance of
the Bonds and the execution of the Loan Agreement is hereby
ratified, approved and confirmed.
I. Repealer. All ordinances, resolutions, bylaws,
orders, and other instruments, or parts thereof, inconsistent
herewith are hereby repealed to the extent only of such
inconsistency. This repealer shall not be construed to revive any
ordinance, resolution, bylaw, order, or other instrument, or part
thereof, heretofore repealed.
J. Severability. If any section, subsection,
paragraph, clause or other provision of this Ordinance shall for
any reason be held to be invalid or unenforceable, the invalidity
or unenforceability thereof shall not affect any of the remaining
sections, subsections, paragraphs, clauses or provisions of this
Ordinance.
INTRODUCED, READ, APPROVED ON FIRST READING, AND ORDERED
PUBLISHED BY NUMBER AND TITLE ONLY this 7th day of. July, 1992 .
CITY OF FORT COLLINS, COLOttRADO
By:
(CITY) Mayor
(SEAL)
�ATTEST:
37, � • `�k�1 ll
City Clerk
32
Council Member Azari moved that Ordinance No. 75, 1992,
heretofore introduced and read by title be approved on first
reading.
Council Member Edwards seconded the motion.
The question being upon the approval on first reading of
Ordinance No. 75, 1992, the roll was called with the following
results:
Council Members voting "AYE" : Susan E. Kirkpatrick
Ann Azari
Dave Edwards
Cathy Fromme
Gerry Horak
Loren R. Maxey
Bob Winokur
Council Members voting "NAY" : None
The Mayor thereupon declared that, a majority of the
Council Members present having voted in favor thereof, the motion
was carried and Ordinance No. 75, 1992 , duly approved on first
reading.
The Council deeming it appropriate, the Mayor ordered
Ordinance No. 75, 1992, published by number and title only together
with a statement that the text thereof is available for public
inspection and acquisition in the office of the City Clerk and a
notice giving the date when the Ordinance will be presented for
final passage in The Coloradoan, a newspaper of general circulation
published in the City, at least seven (7) days before presentation
for final passage.
After consideration of other business to come before the
Council, the meeting was adjourned.
Mayor
(CITY) City of Fort Collins, Colorado
(SEAL)
ATTEST:
(�
City Clerk
City of Fort Collins, Colorado
33
STATE OF COLORADO )
COUNTY OF LARIMER ) ss.
CITY OF FORT COLLINS )
The Council of the City of Fort Collins, Colorado, held
a regular meeting at Council Chambers, City Hall, 300 West LaPorte
Avenue, Fort Collins, Colorado, on Tuesday, the 21st day of July,
1992, at the hour of 6: 30 p.m.
The following persons were present:
Council Members: Susan E. Kirkpatrick, Mayor
Ann Azari, Mayor Pro Tem
Dave Edwards
Loren R. Maxey
Deputy City
Manager: Diane Jones
Deputy City Clerk: Molly J. Davis
Financial Officer: Alan J. Krcmarik
City Attorney: Stephen J. Roy
The following persons were absent:
Cathy Fromme
Gerry Horak
Bob Winokur
Steven C. Burkett
Wanda M. Krajicek
The Mayor informed the Council that Ordinance No. 75,
1992, was duly published in The Coloradoan, a newspaper of general
circulation published in the City, in its issue of July 12, 1992 .
Council Member Azari then moved that Ordinance No. 75,
1992, be amended. The following Ordinance with amendments was then
read by title, copies of the full Ordinance with• amendments,
excepting only those read in public at the meeting, having been
available in the office of the City Clerk at least forty-eight (48)
hours prior to the time the Ordinance was considered for amendment
for each Council Member and for inspection and copying by the
general public:
34
ORDINANCE NO. 75, 1992
AN ORDINANCE AUTHORIZING THE EXECUTION AND DELIVERY OF A
LOAN AGREEMENT, DATED AS OF JULY 15, 1992, BETWEEN THE
COLORADO WATER RESOURCES AND POWER DEVELOPMENT AUTHORITY
AND THE CITY OF FORT COLLINS, COLORADO, THE ISSUANCE OF
A GOVERNMENTAL AGENCY BOND (CITY OF FORT COLLINS,
COLORADO, SEWER REVENUE BOND, SERIES 1992, DATED JULY 15,
1992, IN THE AGGREGATE PRINCIPAL AMOUNT OF $24, 540, 580)
EVIDENCING THE CITY'S OBLIGATIONS UNDER THE LOAN
AGREEMENT AND THE UNDERTAKING AND COMPLETION OF A PROJECT
RELATING TO THE SEWERAGE FACILITIES OF THE CITY OF FORT
COLLINS, COLORADO.
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS, COLORADO, THAT:
section 1. Definitions and Construction.
A. Definitions. In this Ordinance the following terms
have the following respective meanings unless the context hereof
clearly requires otherwise:
(1) Additional Parity Bonds: any Parity Securities
issued after the issuance of the Bonds.
(2) Authority: the Colorado Water Resources and
Power Development Authority, its successor and assigns.
(3) Average Annual Debt Service Requirements: the
aggregate of all Debt Service Requirements (excluding any
redemption premiums) due on any issue of securities payable
from the Net Pledged Revenues for all Bond Years beginning
with the Bond Year in which Debt Service Requirements of such
securities are first payable and ending with the Bond Year in
which the last of the Debt Service Requirements are payable
divided by the number of such years.
(4) Bonds: the Governmental Agency Bond (City of
Fort Collins, Colorado, Sewer Revenue Bond, Series 1992, dated
July 15, 1992, in the aggregate principal amount of
$24 , 540, 580) .
(5) Bond Year: the twelve (12) months commencing
on the second day of December of any calendar year and ending
on the first day of December of the next succeeding calendar
year.
(6) Charter: the Home Rule Charter of the City as
amended.
(7) City: the City of Fort Collins, Colorado.
35
(8) Commercial Bank: a state or national bank or
trust company which is a member of the Federal Deposit
Insurance Corporation and of the Federal Reserve System, which
has a capital and surplus of $10,000,000 or more, and which is
located within the United States of America.
(9) Comparable Bond Year: in connection with any
Fiscal Year, the Bond Year which ends in such Fiscal Year.
For example, for the Fiscal Year commencing on January 1,
1993 , the Comparable Bond Year for the Bonds commences on
December 2, 1992, and ends on December 1, 1993 .
(10) Costs of the Project: all or any part of the
cost of the acquisition, construction, installation and
equipment of all or any part of the Project, to the extent
eligible for payment or reimbursement under the Loan
Agreement.
(11) Council: the governing body of the City.
(12) Debt Service Requirements: the principal of,
interest on, and any premium due in connection with the
redemption of any securities payable from the Net Pledged
Revenues, whether at maturity or otherwise.
(13) Event of Default: any of the events described
in Section 10A hereof.
(14) Federal Securities: bills, certificates of
indebtedness, notes, or bonds which are direct obligations of
the United States of America or obligations the principal and
interest of which are unconditionally guaranteed by the United
States of America.
(15) Fiscal Year: the twelve (12) months commencing
on the first day of January of any calendar year and ending on
the last day of December of such calendar year or such other
twelve (12) month period as may from time to time be
designated by the Council as the Fiscal Year of the City.
(16) Income: all income from rates, fees, tolls,
and charges and tap fees and plant investment fees, or any
combination thereof, for the services furnished by, or the
direct or indirect connection with, or the use of the Sewerage
Facilities, including, without limiting the generality of the
foregoing, minimum charges, charges for the availability of
service, disconnection fees, reconnection fees, and reasonable
penalties for any delinquencies, all supplemental user fees
payable pursuant to any contract between the City and any user
of any Sewerage Facilities, and all income or other gain, if
any, from any investment of Net Pledged Revenues and of the
proceeds of securities payable from Net Pledged Revenues
36
(except income or other gain from any investment of moneys
held in any escrow or other similar fund or account for the
defeasance and/or payment of securities payable from the Net
Pledged Revenues) , but not including sewer trunk line
assessments and sewer main line assessments.
(17) Interest Payment Date: a date designated by
ordinance (or, in the case of the Bonds, by the Loan
Agreement) for the payment of interest on any securities
payable from the Net Pledged Revenues.
(18) Loan Agreement: the Loan Agreement, dated as
of July 15, 1992, between the Authority and the City,
including the exhibits thereto.
(19) Maturity Date: a date designated by ordinance
(or, in the case of the Bonds, by the Loan Agreement) for the
payment of principal of any securities payable from the Net
Pledged Revenues.
(20) Net Pledged Revenues: all Income remaining
after the deduction of Operation and Maintenance Expenses.
(21) Operation and Maintenance Expenses: such
reasonable and necessary current expenses of the City, paid or
accrued, of operating, maintaining and repairing the Sewerage
Facilities as may be determined by the Council, including,
except as limited by contract or otherwise limited by law,
without limiting the generality of the foregoing:
(a) Engineering, auditing, legal and other
overhead expenses of the City directly related and
reasonably allocable to the administration, operation and
maintenance of the Sewerage Facilities;
(b) Insurance and surety bond premiums
appertaining to the Sewerage Facilities;
(c) The reasonable charges of any paying
agent, registrar, transfer agent, depository or escrow
bank appertaining to securities payable from the Net
Pledged Revenues;
(d) Annual payments to pension, retirement,
health and hospitalization funds appertaining to the
Sewerage Facilities;
(e) Any taxes, assessments, franchise fees or
other charges or payments in lieu of the foregoing;
(f) Ordinary and current rentals of equipment
or other property;
37
(g) Contractual services, professional
services, salaries, administrative expenses, and costs of
labor appertaining to the Sewerage Facilities and the
cost of materials and supplies used for current operation
of the Sewerage Facilities;
(h) The costs incurred in the collection of
all or any part of the Net Pledged Revenues;
(i) Any costs of utility services furnished to
the Sewerage Facilities by the City or otherwise.
"Operation and Maintenance Expenses" does not include:
(a) Any allowance for depreciation;
(b) Any costs of reconstruction, Improvement,
extensions, or betterments;
(c) Any accumulation of reserves for capital
replacements;
(d) Any reserves for operation, maintenance,
or repair of the Sewerage Facilities;
(e) Any allowance for the redemption of any
bonds or other securities or the payment of any interest
thereon;
(f) Any liabilities incurred in the
acquisition of any properties comprising the Sewerage
Facilities;
(g) Any other ground of legal liability not
based on contract.
(22) Operation and Maintenance Fund: the special
fund created by and designated as such in Ordinance No. 101,
1982 , and referred to in Section 5C hereof.
(23) Ordinance: this Ordinance No. 75, 1992, of the
City.
(24) Outstanding: as of any particular date, all
the Prior Bonds, Bonds, Additional Parity Bonds, Parity
Securities or any such other securities payable in whole or in
part from the Net Pledged Revenues which have been authorized,
executed and delivered except the following:
(a) Any Prior Bond, Bond, Additional Parity
Bond, Parity Security or other security cancelled by or
on behalf of the City on or before such date;
38
(b) Any Prior Bond, Bond, Additional Parity
Bond, Parity Security or other security held by or on
behalf of the City;
(c) Any Prior Bond, Additional Parity Bond,
Parity Security or other security of the City for the
payment or the redemption of which moneys or Federal
Securities sufficient (including the known minimum yield
available for such purpose from Federal Securities in
which such amount wholly or in part may be initially
invested) to pay all of the Debt Service Requirements of
such Prior Bond, Additional Parity Bond, Parity Security
or other security to the Maturity Date or specified
Redemption Date thereof shall have theretofore been
deposited in escrow or in trust with a Trust Bank for
that purpose;
(d) Any Bond for the payment or redemption of
which moneys equal to the Debt Service Requirements until
maturity or redemption shall have been paid to the
Authority under the Loan Agreement; and
(e) Any lost, destroyed, or wrongfully taken
Prior Bond, Bond, Additional Parity Bond, Parity Security
or other security of the City in lieu of or in
substitution for which another bond or other security
shall have been executed and delivered.
(25) Owner: the holder of any bearer instrument or
registered owner of any registered instrument.
(26) Parity Securities: bonds, warrants, notes,
securities, leases or other contracts evidencing borrowings
and payable from the Net Pledged Revenues equally or on a
parity with the Bonds.
(27) Permitted Investments: any legal investment or
deposit authorized by State statute or City ordinance adopted
pursuant to the Charter.
(28) Person: any individual, firm, partnership,
corporation, company, association, joint stock association or
body politic or any trustee, receiver, assignee or similar
representative thereof.
(29) Prior Bonds: the City of Fort Collins,
Colorado, Sewer Revenue Refunding Bonds, Series 1986, dated
August 1, 1986, in the original aggregate principal amount of
$36,950, 000.
(30) Prior Bonds Debt Service Reserve Fund: the
special fund created by and designated in Ordinance No. 9,
39
1975, of the City as the "City of Fort Collins Sewer Refunding
Revenue Bonds Reserve Fund" and referred to in Section 5E
hereof.
(31) Prior Bonds Principal and Interest Fund: the
special fund created by and designated in Ordinance No. 9,
1975, of the City as the "City of Fort Collins Sewer Refunding
Revenue Bonds, Series 1975, Bond Fund" and referred to in
Section 5D hereof.
(32) Project: the acquisition, construction,
installation and equipment of that portion of the Sewerage
Facilities for which the Bonds are issued.
(33) Project Loan Subaccount: the special fund or
account of the Authority referred to in Section 5A hereof.
(34) Redemption Date: the date fixed for the
redemption prior to maturity of any Bonds or other designated
securities payable from the Net Pledged Revenues in any notice
of prior redemption given by or on behalf of the City.
(35) Security or securities: any bond issued by the
City or any other evidence of the advancement of money to the
City.
(36) Sewerage Facilities: any one or more of the
various devices used in the collection, treatment, or
disposition of sewage and industrial wastes of a liquid
nature, including, without limitation, all inlets; collection,
drainage, or disposal lines; intercepting sewers; sewage
disposal plants; outfall sewers; sewage lagoons; all pumping,
power, and other equipment and appurtenances; all extensions,
improvements, remodeling, additions and alterations thereof;
any and all rights or interests for such sewerage facilities;
and all other necessary, incidental, or appurtenant
properties, equipment, and facilities relating to the
foregoing.
(37) Sewer Fund: the special fund created by and
designated as such in Ordinance No. 67, 1974, of the City and
referred to in Section 5B hereof.
(38) State: the State of Colorado.
(39) Subordinate Bonds or Subordinate Securities:
bonds or securities payable from the Net Pledged Revenues
having a lien thereon subordinate or junior to the lien
thereon of the Bonds.
40
(40) Subsequent Bonds Debt Service Reserve Fund:
the special fund created by and referred to in Section 5G
hereof.
(41) Subsequent Bonds Principal and Interest Fund:
the special fund created by and referred to in Section 5F
hereof.
(42) Superior Bonds or Superior Securities: bonds
or securities payable from the Net Pledged Revenues having a
lien thereon superior or senior to the lien thereon of the
Bonds.
(43) Trustee: First Interstate Bank of Denver,
N.A. , or its successors, as trustee for the bonds of the
Authority issued to finance the loan to the City under the
Loan Agreement.
(44) Wastewater Utility Capital Reserve: the
special fund created by the City and referred to in Section 5I
hereof.
B. Construction. This Ordinance, except where the
context by clear implication herein otherwise requires, shall be
construed as follows:
(1) Words in the singular include the plural, and
words in the plural include the singular.
(2) Words in the masculine gender include the
feminine and the neuter, and when the sense so indicates words
of the neuter gender refer to any gender.
(3) Articles, sections, subsections, paragraphs and
subparagraphs mentioned by number, letter, or otherwise,
correspond to the respective articles, sections, subsections,
paragraphs and subparagraphs of this Ordinance so numbered or
otherwise so designated.
(4) The titles and headlines applied to articles,
sections and subsections of this Ordinance are inserted only
as a matter of convenience and ease in reference and in no way
define or limit the scope or intent of any provisions of this
Ordinance.
Section 2. The Project.
A. Necessity. The City has need for and desires to
acquire, construct, install and equip the Project.
41
B. Authorization. The Council hereby authorizes the
undertaking and completion of the Project.
Section 3 . The Loan Agreement. Pursuant to art. XX, §6
of the State Constitution and Art. V, Section 19 .3 of the Charter,
the City is authorized by Council action and without an election to
execute and deliver the Loan Agreement. The Council hereby
authorizes the Mayor, the City Clerk and the Financial Officer of
the City to execute and deliver the Loan Agreement on behalf of the
City.
Section 4. The Bonds.
A. Authorization. Pursuant to art. XX, sec. 6 of the
Colorado Constitution and Art. V, Section 19. 3 of the Charter, the
City is authorized by Council action and without an election to
issue the Bonds to evidence its obligations under the Loan
Agreement. The Council hereby authorizes the issuance of the
Bonds, payable as to all Debt Service Requirements solely out of
Net Pledged Revenues, for the purpose of acquiring, constructing,
installing and equipping the Project.
B. Bond Details.
(1) Generally. The Bonds shall mature and bear
interest as provided in the Loan Agreement.
(2) Redemption. The Bonds shall be redeemable or
prepayable as provided in the Loan Agreement.
(3) Interest Rates. The maximum net effective
interest rate authorized for the Bonds is 15% per annum, and
the actual net effective interest rate for the Bonds is 6.86%
per annum excluding interest subsidies payable under the Loan
Agreement and 4. 27% per annum including interest subsidies
payable under the Loan Agreement.
(4) Execution. The Bonds shall be executed by and
on behalf of the City with the manual signature of the Mayor,
shall bear the seal of the City, shall be attested with the
manual signature of the City Clerk, and shall be countersigned
with the manual signature of the Financial Officer of the
City. Should any officer whose manual signature appears on
the Bonds cease to be such officer before delivery of the
Bonds to the Authority, such manual signature shall
nevertheless be valid and sufficient for all purposes.
(5) Registration and Transfer. The Bonds shall be
in registered form and shall be transferable to the extent and
as provided in the Loan Agreement.
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(6) Replacement of Bonds. If any Bond shall have
been lost, destroyed or wrongfully taken, the City shall
provide for the replacement thereof in the manner set forth
and upon receipt of the evidence, indemnity bond and
reimbursement for expenses provided in Ordinance No. 80, 1984.
(7) Recitals in Bonds. Each Bond shall recite in
substance that the Bond is a special and limited obligation of
the City payable solely out of and secured by an irrevocable
pledge of and second lien (but not necessarily exclusive
second lien) upon the Net Pledged Revenues, that the Bond does
not constitute a debt or an indebtedness of the City within
the meaning of any constitutional, Charter or statutory
provision or limitation, that the Bond is not payable in whole
or in part from the proceeds of general property taxes, and
that the full faith and credit of the City is not pledged for
the payment of the principal of or interest on the Bond.
(8) Form of Bonds. The Bonds shall be in
substantially the form set forth in Exhibit D of the Loan
Agreement.
C. Special Obligations. The Bonds, as to all Debt
Service Requirements thereof, shall be payable solely out of the
Net Pledged Revenues. The Authority may not look to the general
fund or any other fund of the City for the payment of the Debt
Service Requirements thereof, except the special funds pledged
therefor. The Bonds shall not constitute a debt or indebtedness of
the City within the meaning of any constitutional, charter or
statutory provision or limitation, and the Bonds shall not be
considered or held to be general obligations of the City but shall
constitute special and limited obligations of the City. The Bonds
are not payable in whole or in part from the proceeds of general
property taxes, and the full faith and credit of the City is not
pledged for payment of the Bonds.
Section 5. Disposition of Bond Proceeds and Income_
Funds and Accounts Adopted or Created by Ordinance: Security for
Bonds. The proceeds of the Bonds and the Income shall be deposited
by the City in the funds described in this Section 5, to be
accounted for in the manner and priority set forth in this
Section 5.
The Net Pledged Revenues and all moneys and securities
paid or to be paid to or held or to be held in any fund hereunder
are hereby pledged to secure the payment of the Debt Service
Requirements of the Prior Bonds (including any costs incurred by
the City in connection with any undertaking by a financial
institution as described in Section 5E hereof) , the Bonds and any
other Parity Securities and any Subordinate Bonds or other
Subordinate Securities as provided herein. This pledge shall be
valid and binding from and after the date of the first delivery of
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the Bonds, and the moneys, as received by the City and hereby
pledged, shall immediately be subject to the lien of this pledge
without any physical delivery thereof, any filing, or further act.
The lien of this pledge and the obligation to perform the
contractual provisions hereby made shall have priority over any or
all other obligations and liabilities of the City (except as herein
otherwise expressly provided) , and the lien of this pledge shall be
valid and binding as against all parties having claims of any kind
in tort, contract or otherwise against the City (except as herein
otherwise expressly provided) , irrespective of whether such parties
have notice thereof.
A. Project Loan Subaccount. The net proceeds of the
Bonds shall be held by the Trustee in the Project Loan Subaccount
and disbursed to the City for payment of Costs of the Project as
provided in the Loan Agreement.
B. Sewer Fund. Except as otherwise provided herein,
the entire Income, upon receipt thereof from time to time by the
City, shall be set aside and credited immediately to the Sewer
Fund. In addition, the City may at its option credit to the Sewer
Fund any other moneys of the City legally available for expenditure
for the purposes of the Sewer Fund as provided herein.
The Sewer Fund shall be administered and the moneys on
deposit therein shall be deposited and applied in the following
order of priority:
(1) First, to the Operation and Maintenance Fund to
pay Operation and Maintenance Expenses in the manner set forth
in Section 5C hereof;
(2) Second, to the Prior Bonds Principal and
Interest Fund to pay the Debt Service Requirements of the
Prior Bonds then Outstanding in the manner set forth in
Section 5D hereof;
(3) Third, to the Prior Bonds Debt Service Reserve
Fund in the manner set forth in Section 5E hereof;
(4) Fourth, to the Subsequent Bonds Principal and
Interest Fund to pay the Debt Service Requirements of the
Bonds, any Additional Parity Bonds and any other Parity
Securities then Outstanding in the manner set forth in
Section 5F hereof;
(5) Fifth, to the Subsequent Bonds Debt Service
Reserve Fund in the manner set forth in Section 5G hereof;
(6) Sixth, to the payment of the Debt Service
Requirements of Subordinate Bonds or other Subordinate
Securities in accordance with Section 5H hereof;
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(7) Seventh, to the accumulation or replenishment
of the Wastewater Utility Capital Reserve in the manner set
forth in Section 5I hereof; and
(8) Eighth, to be used in accordance with
Section 5J hereof.
C. Operation and Maintenance Fund. As a first charge
on the Sewer Fund there shall be credited from time to time to the
Operation and Maintenance Fund, Income sufficient to pay the
Operation and Maintenance Expenses of the Sewerage Facilities as
they become due and payable, and thereupon the Operation and
Maintenance Expenses shall be promptly paid.
Any surplus remaining in the Operation and Maintenance
Fund and not needed for Operation and Maintenance Expenses shall be
transferred to the Sewer Fund and used for the purposes thereof.
D. Prior Bonds Principal and Interest Fund. The City
shall deposit in the Prior Bonds Principal and Interest Fund from
the Net Pledged Revenues on or before the last day of each month
the following amounts:
(1) Interest Payments. One-sixth (1/6) of the
aggregate amount of the next installment of interest due in
the then-current Bond Year plus any other amounts due for
interest on the Prior Bonds then Outstanding.
(2) Principal Payments. One-twelfth (1/12) of the
aggregate amount of the next installment of principal due in
the then-current Bond Year plus any other amounts due for
principal of the Prior Bonds then Outstanding.
Such interest and principal shall be promptly paid when
due.
The Net Pledged Revenues credited to the Prior Bonds
Principal and Interest Fund shall be used to pay the Debt Service
Requirements of the Prior Bonds then Outstanding, as such Debt
Service Requirements become due, except as otherwise provided in
this Ordinance. The Prior Bonds Principal and Interest Fund shall
be maintained as a sinking fund for the mandatory redemption of
Prior Bonds maturing in the years 2004 and 2010. Any mandatory
sinking fund redemption shall be treated as an installment of
principal for purposes of this Section 5D.
E. Prior Bonds Debt Service Reserve Fund. Subject to
the payments required by Section 5D hereof, there shall be credited
as hereinafter provided to the Prior Bonds Debt Service Reserve
Fund from the Net Pledged Revenues moneys sufficient to accumulate
in and maintain the Prior Debt Service Reserve Fund at an amount at
least equal to the Average Annual Debt Service Requirements of all
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outstanding Prior Bonds. Said amount shall be maintained as a
continuing reserve for the payment of the Debt Service Requirements
of the Prior Bonds. No payment need be made into the Prior Bonds
Debt Service Reserve Fund so long as the moneys therein shall equal
not less than said amount. In the event that the amount on deposit
in the Prior Bonds Debt Service Reserve Fund falls below the amount
required to be maintained therein, the City shall credit to the
Prior Bonds Debt Service Reserve Fund such Net Pledged Revenues as
may be needed to accumulate or reaccumulate the amount therein so
that at all times the amount of the Prior Bonds Debt Service
Reserve Fund equals said amount. The moneys in the Prior Bonds
Debt Service Reserve Fund shall be set aside, accumulated, and, if
necessary, reaccumulated as provided herein, from time to time, and
maintained as a continuing reserve to be used only to prevent
deficiencies in the Prior Bonds Principal and Interest Fund
resulting from failure to deposit therein sufficient sums to pay
such Debt Service Requirements of the Prior Bonds as the same
become due.
If at any time the City shall for any reason fail to pay
into the Prior Bonds Principal and Interest Fund the full amount
above stipulated, then an amount shall be paid into the Prior Bonds
Principal and Interest Fund at such time from the Prior Bonds Debt
Service Reserve Fund equal to the difference between that paid from
the Net Pledged Revenues in the Sewer Fund and the full amount so
stipulated. The money so used shall be replaced to the Prior Bonds
Debt Service Reserve Fund from the Net Pledged Revenues thereafter
received and not required to be otherwise applied by Section 5D
hereof.
If at any time the City shall for any reason fail to pay
into the Prior Bonds Debt Service Reserve Fund the full amount
stipulated herein from the Net Pledged Revenues in the Sewer Fund,
the difference between the amount paid and the amount so stipulated
shall in a like manner be paid therein from the first Net Pledged
Revenues thereafter received and not required to be applied
otherwise by Section 5D hereof.
Nothing in this ordinance shall be construed as limiting
the right of the City to substitute for the cash deposit required
to be maintained hereunder a letter of credit, surety bond,
insurance policy, agreement guaranteeing payment, or other
undertaking by a financial institution to ensure that cash in the
amount otherwise required to be maintained hereunder will be
available to the City as needed, provided that any such
substitution shall first be approved in writing by Financial
Guaranty Insurance Company and shall be submitted to Moody's
Investors Service, Inc. and Standard & Poor's Corporation and shall
not cause the then-current ratings of the Prior Bonds to be
adversely affected.
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After the delivery of any undertaking by a financial
institution as described in this Section 5E, any costs incurred by
the City in connection therewith shall be paid by the City to such
financial institution as provided in any agreement between the City
and such financial institution. The obligation of the City to make
such payments shall have the same priority as its obligation to
make payments to and replenishments of the Prior Bonds Debt Service
Reserve Fund as provided in this Section 5E. If and to the extent
that cash or investments are deposited in the Prior Bonds Debt
Service Reserve Fund after the delivery of any such undertaking,
all such cash shall be used, and all such investments shall be sold
and the proceeds thereof shall be applied, for the purposes of the
Prior Bonds Debt Service Reserve Fund before any claim is made on
such undertaking, and payment of any costs incurred by the City in
connection therewith shall be paid by the City to such financial
institution before any such cash or investments are replenished to
the Prior Bonds Debt Service Reserve Fund. If more than one such
undertaking is delivered to the City, any claims against such
undertakings shall be made in the manner specified herein on a pro
rata basis (calculated with reference to the maximum amounts
available thereunder) , and any payments of costs incurred by the
City shall be made in the manner specified herein on a pro rata
basis (calculated as provided above) .
F. Subsequent Bonds Principal and Interest Fund. The
City shall deposit in the Subsequent Bonds Principal and Interest
Fund hereby created, forthwith upon receipt of the proceeds of the
Bonds, interest accrued thereon from their date of issue to the
date of delivery thereof to the Authority, to apply to the payment
of interest first due on the Bonds. In lieu of such deposit the
City may permit the Authority to credit such accrued interest to
any fund or account maintained by the Authority to account for
payments by the City of Debt Service Requirements of the Bonds or
payments under the Loan Agreement.
After the payments required by Sections 5D and 5E hereof
for the current Bond Year have been made, the City shall deposit in
the Subsequent Bonds Principal and Interest Fund from the Net
Pledged Revenues on or before the last day of August, 1992, or as
soon thereafter as the provisions hereof permit, the amount of
interest accruing on the Bonds during said month (with a credit for
the amount of any accrued interest, capitalized interest or
investment earnings deposited in the Subsequent Bonds Principal and
Interest Fund or credited to any fund or account maintained by the
Authority for the purposes described above or herein and not
theretofore credited) and on or before the last day of each month
beginning September, 1992, or as soon thereafter as the provisions
hereof permit, the following amounts (with a credit for the amount
of any accrued interest, capitalized interest or investment
earnings deposited in the Subsequent Bonds Principal and Interest
Fund or credited to any fund or account maintained by the Authority
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for the purposes described above or herein and not theretofore
credited) :
(1) Interest Payments. One-third (1/3) of the
aggregate amount of the next installment of interest due on
the Bonds on the next Interest Payment Date in the
then-current Bond Year plus any other amounts due for interest
on the Bonds, any Additional Parity Bonds and any other Parity
Securities then Outstanding.
(2) Principal Payments. One-twelfth (1/12) of the
aggregate amount of the next installment of principal due on
the Bonds on the next Maturity Date in the then-current Bond
Year plus any other amounts due for principal of the Bonds,
any Additional Parity Bonds and any other Parity Securities
then Outstanding.
Such interest and principal shall be promptly paid when
due.
The moneys credited to the Subsequent Bonds Principal and
Interest Fund shall be used to pay the Debt Service Requirements of
the Bonds, any Additional Parity Bonds and any other Parity
Securities then Outstanding, as such Debt Service Requirements
become due, except as otherwise provided in this Ordinance.
After the payments required by Sections 5D and 5E hereof
and those required above in this Section 5F for each current Bond
Year have been made, all Net Pledged Revenues not exceeding the
lesser of $2,900, 000 and the Debt Service Requirements of the Prior
Bonds due in the next succeeding Bond Year shall be transferred to
the Prior Bonds Principal and Interest Fund and used in the next
succeeding Bond Year for the purposes thereof.
G. Subsequent Bonds Debt Service Reserve Fund. After
the payments required by Sections 5D and 5E hereof for the current
Bond Year have been made and subject to the payments required by
Section 5F hereof, there shall be credited to the Subsequent Bonds
Debt Service Reserve Fund hereby created from the Net Pledged
Revenues moneys sufficient to accumulate in and maintain the
Subsequent Bonds Debt Service Reserve Fund at an amount at least
equal to that amount, if any, specified in any ordinance
authorizing the issuance of any Additional Parity Bonds or other
Parity Securities. Said amount shall be maintained as a continuing
reserve for the payment of the Debt Service Requirements of any
Additional Parity Bonds or other Parity Securities and, if any such
ordinance so provides, the Bonds. In the event that the amount on
deposit in the Subsequent Bonds Debt Service Reserve Fund falls
below the amount required to be maintained therein, the City shall
credit to the Subsequent Bonds Debt Service Reserve Fund such Net
Pledged Revenues as may be needed to accumulate or reaccumulate the
amount therein so that at all times the amount of the Subsequent
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Bonds Debt Service Reserve Fund equals said amount. The moneys in
the Subsequent Bonds Debt Service Reserve Fund shall be set aside,
accumulated, and, if necessary, reaccumulated as provided herein,
from time to time, and maintained as a continuing reserve to be
used only to prevent deficiencies in the Subsequent Bonds Debt
Service Reserve Fund resulting from failure to deposit therein
sufficient sums to pay such Debt Service Requirements of any
Additional Parity Bonds or other Parity Securities and, if any
ordinance authorizing the issuance of any Additional Parity Bonds
or other Parity Securities so provides, the Bonds as the same
become due.
If at any time the City shall for any reason fail to pay
into the Subsequent Bonds Principal and Interest Fund the full
amount above stipulated, then an amount shall be paid into the
Subsequent Bonds Principal and Interest Fund at such time from the
Subsequent Bonds Debt Service Reserve Fund equal to the difference
between that paid from the Net Pledged Revenues in the Sewer Fund
and the full amount so stipulated. The money so used shall be
replaced to the Subsequent Bonds Debt Service Reserve Fund
thereafter received and not required to be otherwise applied by
Sections 5D through 5F hereof.
If at any time the City shall for any reason fail to pay
into the Subsequent Bonds Debt Service Reserve Fund the full amount
stipulated herein from the Net Pledged Revenues in the Sewer Fund,
the difference between the amount paid and the amount so stipulated
shall in a like manner be paid therein from the first Net Pledged
Revenues thereafter received and not required to be applied
otherwise by Sections 5D through 5F hereof.
H. Payment of Subordinate Securities. After the
payments required by Sections 5D and 5E hereof for the current Bond
Year have been made and subject to the payments required by
Sections 5F and 5G hereof, any remaining Net Pledged Revenues may
be used by the City for the payment of Debt Service Requirements of
Subordinate Securities payable from the Net Pledged Revenues and
authorized to be issued in accordance with this Ordinance,
including reasonable reserves for such Subordinate Securities; but
the lien of such Subordinate Securities on the Net Pledged Revenues
and the pledge thereof for the payment of such Subordinate
Securities shall be subordinate to the lien and pledge of the
Bonds, any Additional Parity Bonds and any other Parity Securities
as herein provided.
I. Wastewater Utility Capital Reserve. The City shall,
so long as any of the Prior Bonds remain Outstanding, maintain in
the Wastewater Utility Capital Reserve an amount at least equal to
25% of the Operation and Maintenance Expenses budgeted for the
then-current Fiscal Year and shall, after the redemption or
defeasance of the Prior Bonds and so long as any Debt Service
Requirements of the Bonds or amounts due under the Loan Agreement
49
remain unpaid, maintain in the Wastewater Utility Capital Reserve
an amount at least equal to 17% of the Operation and Maintenance
Expenses budgeted for the then-current Fiscal Year. Said amounts
shall be maintained as a continuing reserve for payment of costs of
necessary capital improvements to the Sewerage Facilities and,
subject to the foregoing, may be expended in the sole discretion of
the City.
If moneys in the Wastewater Utility Capital Reserve are
expended so that the amount therein is less than the minimum amount
required hereby, any deficiency shall, after the payments required
by Sections 5D and 5E hereof for the current Bond Year have been
made and subject to the payments required or permitted by Sections
5F through 5H hereof, be replenished over a period not exceeding
twenty-four (24) months in substantially equal monthly
installments. No payment need be made into the Wastewater Utility
Capital Reserve so long as the moneys therein shall equal not less
than the amount required hereby.
J. Use of Remaining Revenues. After the payments.
required by Sections 5D and 5E hereof have been made in any Bond
Year and subject to the payments required or permitted by Sections
5F through 5I hereof, any remaining Net Pledged Revenues may be
used for any one or any combination of lawful purposes as provided
in Art. XII, Section 6 of the Charter.
K. Termination of Deposits. No payment need be made
into the Prior Bonds Principal and Interest Fund or the Prior Bonds
Debt Service Reserve Fund if the amount of cash and investments in
the Prior Bonds Principal and Interest Fund and the Prior Bonds
Debt Service Reserve Fund is at least equal to the entire amount of
the Outstanding Prior Bonds, as to all Debt Service Requirements,
to their respective Maturity Dates or to any Redemption Dates on
which the City shall have exercised or shall have obligated itself
to exercise its option to redeem, prior to their respective
Maturity Dates, any Prior Bonds then Outstanding and thereafter
maturing (provided that, solely for the purpose of this Section 5K,
there shall be deemed to be a credit to the Prior Bonds Debt
Service Reserve Fund any cash or investments, accounted for in any
other fund or account of the City and restricted solely for the
purpose of paying the Debt Service Requirements of the Prior Bonds,
in which case cash or investments in the Prior Bonds Principal and
Interest Fund and the Prior Bonds Debt Service Reserve Fund in an
amount, except for any known interest or other gain to accrue from
any investment or deposit of moneys pursuant to Section 6B hereof
from the time of any such investment or deposit to the time or
respective times the proceeds of any such investment or deposit
shall be needed for such payment, at least equal to such Debt
Service Requirements, shall be used together with any such gain
from such investments and deposits solely to pay such Debt Service
Requirements as the same become due.
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No payment need be made into the Subsequent Bonds
Principal and Interest Fund or the Subsequent Bonds Debt Service
Reserve Fund if the amount in the Subsequent Bonds Principal and
Interest Fund and the Subsequent Bonds Debt Service Reserve Fund is
at least equal to the entire amount of the Outstanding Bonds and
any Outstanding Additional Parity Bonds and Parity Securities, as
to all Debt Service Requirements, to their respective Maturity
Dates or to any Redemption Dates on which the City shall have
exercised or shall have obligated itself to exercise its option to
redeem, prior to their respective Maturity Dates, any Bonds, any
Additional Parity Bonds and any other Parity Securities then
outstanding and thereafter maturing (provided that, solely for the
purpose of this Section 5K, there shall be deemed to be a credit to
the Subsequent Bonds Principal and Interest Fund moneys, Federal
Securities and bank deposits, or any combination thereof, accounted
for in any other fund or account of the City and restricted solely
for the purpose of paying the Debt Service Requirements of the
Bonds, any Additional Parity Bonds or any other Parity Securities) ,
in which case moneys in the Subsequent Bonds Principal and Interest
Fund in an amount, except for any known interest or other gain to
accrue from any investment or deposit of moneys pursuant to
Section 6B hereof from the time of any such investment or deposit
to the time or respective times the proceeds of any such investment
or deposit shall be needed for such payment, at least equal to such
Debt Service Requirements, shall be used together with any such
gain from such investments and deposits solely to pay such Debt
Service Requirements as the same become due.
L. Budget and Appropriation of Sums. The sums required
to pay the Costs of the Project are hereby appropriated for said
purpose. The sums required to make the payments specified in this
Section 5 are hereby appropriated for said purposes. Said amounts
for each year shall be included in the annual budget and the
appropriation ordinance or measures to be adopted or passed by the
Council in each year respectively while the Bonds, either as to
principal or interest, are Outstanding and unpaid. No provisions
of any constitution, charter, statute, ordinance, resolution, or
other order or measure enacted after the issuance of the Bonds
shall in any manner be construed as limiting or impairing the
obligation of the City to keep and perform the covenants contained
in this Ordinance so long as any of the Bonds remain Outstanding
and unpaid. Nothing herein shall prohibit the Council from
appropriating other funds of the City legally available for this
purpose to the Sewer Fund for the purposes thereof.
Section 6. General Administration of Funds.
A. Places and Times of Deposits. Each of the special
funds created or adopted in Section 5 hereof shall be maintained in
a Commercial Bank kept separate and apart from all other accounts
or funds of the City as trust accounts solely for the purposes
herein designated therefor. For purposes of investment of moneys,
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nothing herein prevents the commingling of moneys accounted for in
any two or more such accounts or funds pertaining to the Income.
Such accounts or funds shall be continuously secured to the fullest
extent required or permitted by the laws of the State for the
securing of public funds and shall be irrevocable and not
withdrawable by anyone for any purpose other than the respective
designated purposes of such accounts or funds. Each periodic
payment shall be credited to the proper account or fund not later
than the date therefor herein designated, except that when any such
date shall be a Saturday, a Sunday or a legal holiday, then such
payment shall be made on or before the next preceding business day.
B. Investment of Funds. Any moneys in any fund
established in Section 5 hereof may be invested, reinvested or
deposited only in Permitted Investments. Investments shall either
be subject to redemption at any time at face value by the Owner
thereof at the option of such Owner or shall mature at such time or
times as shall most nearly coincide with the expected need for
moneys from the fund in question. Investments so purchased in any
such fund shall be deemed at all times to be a part of the
applicable fund; provided that with the exception of the Prior
Bonds Debt Service Reserve Fund the interest accruing on such
investments and any profit realized therefrom shall be credited to
the Sewer Fund, and any loss resulting from such investments shall
be charged to the particular fund in question. Interest and profit
realized from investments in the Prior Bonds Debt Service Reserve
Fund shall be credited to the Prior Bonds Debt Service Reserve
Fund, provided that, so long as the amount in the Prior Bonds Debt
Service Reserve Fund equals at least the amount specified in
Section 5E hereof, such interest and profit may be transferred to
the Prior Bonds Principal and Interest Fund and distributed in the
same manner as other moneys in the Prior Bonds Principal and
Interest Fund. Any loss resulting from such investments in the
Prior Bonds Debt Service Reserve Fund shall be charged to the Prior
Bonds Debt Service Reserve Fund. Investments in the Prior Bonds
Debt Service Reserve Fund shall be valued by the Financial Officer
as frequently as deemed necessary by Financial Guaranty Insurance
Company, but not less often than quarterly, at the market value
thereof. If on any valuation date the market value of investments
in the Prior Bonds Debt Service Reserve Fund is less than the
amount required by Section 5E hereof to be maintained therein due
to market fluctuations, the deficiency shall be remedied no later
than the next quarterly valuation date. The City shall present for
redemption or sale on the prevailing market any securities or
obligations so purchased as an investment of moneys in a given fund
whenever it shall be necessary to do so in order to provide moneys
to meet any required payment or transfer from such fund.
C. No Liability for Losses Incurred in Performing Terms
of Ordinance. Neither the City nor any officer of the City shall
be liable or responsible for any loss resulting from any investment
or reinvestment made in accordance with this Ordinance.
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D. Character of Funds. The moneys in any fund herein
authorized shall consist of lawful money of the United States of
America or Permitted Investments or both such money and Permitted
Investments. Moneys deposited in a demand or time deposit account
in a Commercial Bank, appropriately secured according to the laws
of the State, shall be deemed lawful money of the United States of
America.
E. Accelerated Payments Optional. Nothing contained
herein prevents the accumulation in any fund herein designated of
any monetary requirements at a faster rate than the rate or minimum
rate, as the case may be, provided therefor, but no payment shall
be so accelerated if such acceleration shall cause a default in the
payment of any obligation of the City pertaining to the Income.
Section 7. priorities• Liens• Issuance of Additional
Bonds.
A. Liana on Net Pledged Revenues• Equality of Bonds.
Additional Parity Bonds and Other Parity Securities. Except as
expressly provided in Ordinance No. 98, 1986, with respect to the
Prior Bonds and in this Ordinance with respect to Additional Parity
Bonds, Parity Securities and Subordinate Securities, the Net
Pledged Revenues shall be and hereby are irrevocably pledged and
set aside to pay the Debt Service Requirements of the Bonds.
The Prior Bonds (including any costs incurred by the City
in connection with any undertaking by a financial institution as
described in Section 5E hereof) constitute an irrevocable and first
lien upon the Net Pledged Revenues (provided, however, that the
City shall not pay any such costs unless all payments then due
under Sections 5C and 5D hereof have been made) . The Bonds
constitute an irrevocable and second lien (but not necessarily an
exclusive second lien) upon the Net Pledged Revenues.
The Bonds, any Additional Parity Bonds and any other
Parity Securities hereafter authorized to be issued and from time
to time Outstanding are equitably and ratably secured by a lien on
the Net Pledged Revenues and shall not be entitled to any priority
one over the other in the application of the Net Pledged Revenues
regardless of the time or times of the issuance thereof, it being
the intention of the Council that there shall be no priority among
the Bonds, any Additional Parity Bonds and any other Parity
Securities, regardless of the fact that they may be actually issued
and delivered at different times.
B. Issuance of Additional Parity Bonds. Nothing
herein, subject to the limitations stated in Section 7F hereof,
prevents the issuance by the City of Additional Parity Bonds
payable from the Net Pledged Revenues and constituting a lien on
the Net Pledged Revenues on a parity with, but not prior or
superior to, the lien thereon of the Bonds; but before any such
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Additional Parity Bonds are authorized or actually issued the City
shall satisfy the conditions set forth in the Loan Agreement.
C. Certification of Revenues. Where certifications of
revenues are required by this Ordinance or the Loan Agreement, the
specified and required written certifications of the Financial
Officer of the City that revenues are sufficient to pay the
required amounts shall be conclusively presumed to be accurate in
determining the right of the City to authorize, issue, sell and
deliver Additional Parity Bonds.
D. Subordinate Securities Permitted. Nothing herein,
subject to the limitations stated in Section 7F hereof, prevents
the City from issuing Subordinate Securities for any lawful
purpose.
E. Superior Securities Prohibited. The City has
heretofore issued the Prior Bonds. The City shall not issue any
additional Superior Bonds or Superior Securities.
F. Supplemental Ordinances. Additional Parity Bonds or
Subordinate Securities shall be issued only after authorization
thereof by ordinance, supplemental ordinance or other instrument of
the Council, stating the purpose or purposes of the issuance of
such additional securities, directing the application of the
proceeds thereof to such purpose or purposes, directing the
execution thereof, and fixing and determining the date, series
designation, principal amount, maturity or maturities, maximum rate
or rates of interest, and prior redemption privileges of the City
with respect thereto, and providing for payments to and from the
Sewer Fund in accordance with this Ordinance. All additional
securities shall bear such date, shall be payable as to principal
on December 1 and as to interest on June 1 and December 1 and shall
be subject to redemption prior to maturity on such terms and
conditions, as may be provided, and shall bear interest at such
rate or rates as may be fixed by ordinance, instrument or other
document of the Council. Nothing herein shall be construed to
prohibit the issuance of additional securities payable from the Net
Pledged Revenues, the interest on which is payable more frequently
than semiannually.
Section 8. Covenants. The City hereby incorporates by
this reference all the covenants and agreements contained in the
Loan Agreement and further covenants until the Bonds have been
fully paid and discharged as follows:
A. Rate Maintenance. The City shall prescribe, revise,
and collect rates, fees, tolls, and charges and tap fees and plant
investment fees, or any combination thereof, which may be imposed
by the City whether for the direct or indirect connection with or
the use of the Sewerage Facilities and reasonable penalties for any
delinquencies, which shall produce Income sufficient, together with
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any other moneys legally available therefor and credited to the
Sewer Fund, to make the payments and accumulations required by this
Ordinance, and which shall produce Net Pledged Revenues sufficient,
together with all other moneys legally available therefor and
credited to the Sewer Fund after payment of Operation and
Maintenance Expenses, to pay the amounts specified in paragraph (5)
of Exhibit A of the Loan Agreement.
In the event that such rates, fees, tolls, and charges
and tap fees and plant investment fees at any time should not be
sufficient to make all of the payments and accumulations required
by this Ordinance, the Council shall increase its rates, fees,
tolls, and charges and tap fees and plant investment fees to such
extent as to insure the payments and accumulations required by the
provisions of this Ordinance.
B. Collection of Charaes. The City shall cause all
rates, fees, tolls, and charges and tap fees and plant investment
fees pertaining to the Sewerage Facilities to be billed promptly
and collected as soon as reasonable, shall prescribe and enforce
rules and regulations or impose contractual obligations for the
payment thereof, to the end that the Net Pledged Revenues shall be
adequate to meet the requirements of this Ordinance and any other
ordinance or instrument supplemental thereto. The rates, fees,
tolls, and charges and tap fees and plant investment fees due shall
be collected in any lawful manner.
C. Competent Management. The City shall employ
experienced and competent management personnel for each component
of the Sewerage Facilities. If the City shall fail to pay the Debt
Service Requirements of the Bonds promptly as the same become due,
or if the City shall fail to keep any of the covenants herein
contained, and if such default shall continue for a period of sixty
(60) days, or if the Net Pledged Revenues of the Sewerage
Facilities in any Fiscal Year, together with other legally
available revenue and money, shall fail to equal at least the
amount of the Debt Service Requirements of the Bonds, and other
obligations payable from the Net Pledged Revenues due in the
Comparable Bond Year, the City shall retain a firm of competent
management Persons skilled in the operation of sewerage facilities
to assist in the management of the Sewerage Facilities so long as
such default continues or the said revenues, proceeds and income
are less than the amount hereinabove designated.
D. Performance of Duties. The City, acting by and
through its officers, or otherwise, shall faithfully and punctually
perform, or cause to be performed, all duties with respect to the
Income and the Sewerage Facilities required by the Constitution and
laws of the State and the ordinances, resolutions and contracts of
the City, including, without limitation, the proper segregation of
the proceeds of the Bonds and the Income and their application from
time to time to the respective funds provided therefor.
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E. Costs of Bond Issue and of Performance. Except as
otherwise specifically provided herein, all costs and expenses
incurred in connection with the issuance of the Bonds, payment of
the Debt Service Requirements thereof, or the City's performance of
or compliance with any covenant or agreement contained in this
Ordinance or in the Loan Agreement shall be paid exclusively (but
only from the appropriate special fund in the manner authorized
herein) from the proceeds of the Bonds, from the Net Pledged
Revenues, or from other legally available moneys, and in no event
shall any of such costs or expenses be required to be paid out of
or charged to the general fund of the City.
F. Contractual Obligations. The City will perform all
contractual obligations undertaken by it under the Loan Agreement
and any other agreements relating to the Bonds, the Income, or the
Sewerage Facilities.
G. Further Assurances. At any and all times the City
shall, so far as it may be authorized by law, pass, make, do,
execute, acknowledge, deliver, and file or record all and every
such further instruments, acts, deeds, conveyances, assignments,
transfers, other documents, and assurances as may be necessary or
desirable for the better assuring, conveying, granting, assigning
and confirming all and singular the rights, the Net Pledged
Revenues and other funds hereby pledged, or intended so to be, or
which the City may hereafter become bound to pledge, or as may be
reasonable and required to carry out the purposes of this
Ordinance. The City, acting by and through its officers, or
otherwise, shall at all times, to the extent permitted by law,
defend, preserve and protect the pledge of the Net Pledged Revenues
and other funds pledged hereunder and all the rights of the
Authority against all claims and demands of all Persons whomsoever.
H. Conditions Precedent. Upon the date of issuance of
any of the Bonds, all conditions, acts and things required by the
Constitution or laws of the United States of America, the
Constitution or laws of the State, the Charter, and this Ordinance
to exist, to have happened, and to have been performed precedent to
or in the issuance of the Bonds shall exist, have happened and have
been performed, and the Bonds, together with all other obligations
of the City, shall not contravene any debt or other limitation
prescribed by the Constitution or laws of the United States of
America or the Constitution or laws of the State or the Charter.
I. Efficient Operation and Maintenance. The City shall
at all times operate the Sewerage Facilities properly and in a
sound and economical manner. The City shall maintain, preserve and
keep the Sewerage Facilities properly or cause the same so to be
maintained, preserved, and kept, with the appurtenances and every
part and parcel thereof in good repair, working order and
condition, and shall from time to time make or cause to be made all
necessary and proper repairs, replacements and renewals so that at
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all times the maintenance of the Sewerage Facilities may be
properly and advantageously conducted. All salaries, fees, wages
and other compensation paid by the City in connection with the
repair, maintenance and operation of the Sewerage Facilities shall
be fair and reasonable.
J. Records and Accounts. The City will keep proper
books of record and account, separate and apart from all other
records and accounts, showing complete and correct entries of all
transactions relating to the funds referred to herein.
K. Rules Regulations and Other Details. The City,
acting by and through its officers, shall establish and enforce
reasonable rules and regulations governing the construction,
operation, care, repair, maintenance, management, control, use and
services of the Sewerage Facilities. The City shall observe and
perform all of the terms and conditions contained in this Ordinance
and shall comply with all valid acts, rules, regulations, orders
and directives of any legislative, executive, administrative or
judicial body applicable to the Sewerage Facilities or the City.
L. Payment of Governmental Charges. The City shall pay
or cause to be paid all taxes and assessments or other municipal or
governmental charges, if any, lawfully levied or assessed upon or
in respect of the Sewerage Facilities or upon any part thereof or
upon any portion of the Income, when the same shall become due, and
shall duly observe and comply with all valid requirements of any
municipal or governmental authority relative to the Sewerage
Facilities, or any part thereof, except for any period during which
the same are being contested in good faith by proper legal
proceedings. The City shall not create or suffer to be created any
lien or charge upon the Sewerage Facilities, or any part thereof,
or upon the Income, except the pledge and lien created by this
Ordinance for the payment of the Debt Service Requirements due in
connection with the Bonds and except as herein otherwise permitted.
The City shall pay or cause to be discharged or shall make adequate
provision to satisfy and to discharge, within ninety (90) days
after the same shall become payable, all lawful claims and demands
for labor, materials, supplies or other objects which, if unpaid,
might by law become a lien upon the Sewerage Facilities, or any
part thereof, or the Income, but nothing herein requires the City
to pay or to cause to be discharged or to make provision for any
such tax, assessment, lien or charge, so long as the validity
thereof is contested in good faith and by appropriate legal
proceedings.
M. Protection of Security. The City, its officers,
agents and employees, shall not take any action in such manner or
to such extent as might prejudice the security for the payment of
the Debt Service Requirements of the Bonds and any other securities
payable from the Net Pledged Revenues according to the terms
thereof. No contract shall be entered into nor any other action
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taken by which the rights of any Owner of any Bonds or other
security payable from Net Pledged Revenues might be prejudicially
and materially impaired or diminished.
N. Accumulation of Interest Claims. In order to
prevent any accumulation of claims for interest after maturity, the
City shall not directly or indirectly extend or assent to the
extension of the time for the payment of any claim for interest on
any of the Bonds or any other securities payable from the Net
Pledged Revenues; and the City shall not directly or indirectly be
a party to or approve any arrangements for any such extension or
for the purpose of keeping alive any of such claims for interest.
If the time for the payment of any such installment of interest is
extended in contravention of the foregoing provisions, such
installment or installments of interest after such extension or
arrangement shall not be entitled in case of default hereunder to
the benefit or the security of this Ordinance, except upon the
prior payment in full of the principal of all of the Bonds and any
such securities the payment of which has not been extended.
O. Prompt Payment of Bonds. The City shall promptly
pay the Debt Service Requirements of every Bond at the places, on
the dates, and in the manner specified herein and in the Bonds
according to the true intent and meaning hereof.
P. Use of Funds. The Prior Bonds Principal and
Interest Fund, the Prior Bonds Debt Service Reserve Fund and the
Subsequent Bonds Principal and Interest Fund and the Subsequent
Bonds Debt Service Reserve Fund shall be used solely and only, and
the moneys credited to such funds are hereby pledged, for the
purpose of paying the Debt Service Requirements of the Prior Bonds,
the Bonds, any Additional Parity Bonds and any other Parity
Securities (including any costs incurred by the City in connection
with any undertaking by a financial institution as described in
Section 5E hereof) at maturity, upon prior redemption or otherwise,
subject to Section 9 hereof.
Q. Additional Securities. The City shall not hereafter
issue any bonds or securities relating to the Sewerage Facilities
and payable from the Net Pledged Revenues without compliance with
the requirements with respect to the issuance of Additional Parity
Bonds or other securities set forth herein to the extent
applicable.
R. Other Liens. Other than as provided herein, there
are no liens or encumbrances of any nature whatsoever on or against
the Sewerage Facilities, or any part thereof, or on or against the
Net Pledged Revenues.
S. Surety Bonds. Each official or other person having
custody of any Net Pledged Revenues or responsible for their
handling shall be fully bonded at all times, which bond shall be
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conditioned upon the proper application of said moneys. The cost
of each such bond shall be considered an Operation and Maintenance
Expense, unless otherwise provided by law.
T. Disposal of Sewerage Facilities Prohibited. Subject
to Section 8U hereof, except for the use of the Sewerage Facilities
and services pertaining thereto in the normal course of business,
neither all nor a substantial part of the Sewerage Facilities shall
be sold, mortgaged, pledged, encumbered, alienated or otherwise
disposed of, until all of the Bonds have been paid in full, as to
all Debt Service Requirements thereof, or unless provision has been
made therefor, or until the Bonds have otherwise been redeemed,
including, without limitation, the termination of the pledge as
herein authorized. Subject to Section 8U hereof, the City shall
not dispose of its title to the Sewerage Facilities or to any
material Income-producing part thereof, including any property
necessary to the operation and use of the Sewerage Facilities and
the lands and interests in lands comprising the Sewerage
Facilities.
U. Disposal of Property. No material Income-producing
part of the Sewerage Facilities shall be sold, leased, mortgaged,
pledged, encumbered or otherwise disposed of or otherwise
alienated, until all of the Bonds have been paid in full, or unless
provision has been made therefor, or until the Bonds have otherwise
been redeemed; provided, however, that the City may sell, exchange
or lease at any time and from time to time any property or
facilities constituting part of the Sewerage Facilities and not
useful in the construction, reconstruction or operation thereof;
but any proceeds of any such sale or exchange received and not used
to replace such property so sold or exchanged shall be deposited in
the Sewer Fund, and any proceeds of any such lease received shall
be deposited by the City as revenues of the Sewerage Facilities.
V. Loss from Condemnation. If any part of the Sewerage
Facilities is taken by the exercise of a power of eminent domain,
the amount of any award received by the City as a result of such
taking shall be expended upon the improvement of the Sewerage
Facilities or shall be applied to the redemption of the Outstanding
Prior Bonds in accordance with the provisions of Ordinance No. 98,
1986, the Outstanding Bonds, any Outstanding Additional Parity
Bonds and any Outstanding Parity Securities in accordance with the
provisions hereof and of any other instrument pertaining to the
issuance of any such Additional Parity Bonds or Parity Securities
any Outstanding Subordinate Bonds or Subordinate Securities in
accordance with any instrument pertaining to the issuance of such
Subordinate Bonds or Subordinate Securities at maturity or upon
prior redemption if the authorizing ordinances authorize the prior
redemption of such securities.
W. Inspection of Records. The Authority and any Owner
of any securities payable from the Net Pledged Revenues, any duly
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authorized agent or agents of the Authority or such Owner, shall
have the right at all reasonable times to inspect all records,
accounts and data relating thereto, concerning the Sewerage
Facilities or the Income, to make copies of such records, accounts
and data at the Authority's or Owner's expense, and to inspect the
Sewerage Facilities and properties comprising the Sewerage
Facilities.
X. Audits Recruired. The City, annually following the
close of each Fiscal Year, shall order an audit for the Fiscal Year
of the books and accounts pertaining to the Sewerage Facilities to
be made forthwith by an independent accountant, and order an audit
report showing the receipts and disbursements for each fund or
account pertaining to the Sewerage Facilities or the Income. All
expenses incurred in the making of the audits and reports required
by this subsection shall be regarded and paid as an Operation and
Maintenance Expense.
Y. Insurance and Reconstruction. The City shall at all
times maintain with responsible insurers all such insurance
reasonably required and obtainable within limits and at costs
deemed reasonable by the City as is customarily maintained with
respect to sewerage facilities of like character against loss of or
damage to the Sewerage Facilities and against public and other
liability to the extent at least reasonably necessary to protect
the interest of the City and of each Owner of Bonds or any other
securities payable from the Net Pledged Revenues, except as herein
otherwise provided. If any useful part of the Sewerage Facilities
shall be damaged or destroyed, the City shall, as expeditiously as
possible, commence and diligently proceed with the repair or
replacement of the damaged or destroyed property so as to restore
the same to use. The proceeds of any insurance appertaining to the
Sewerage Facilities shall be payable to the City and (except for
proceeds of use and occupancy insurance) shall be applied to the
necessary costs involved in such repair and replacement, and to the
extent not so applied shall (together with the proceeds of any such
use and occupancy insurance) be deposited in the Sewer Fund as
Income. If the costs of such repair and replacement of the damaged
or destroyed property exceed the proceeds of such property
insurance available for payment of the same, moneys in the Sewer
Fund shall be used to the extent necessary for such purpose, as
permitted by Section 5H hereof.
Section 9. Defeasance. When all Debt Service
Requirements of the Bonds have been duly paid, the pledge and lien
and all obligations hereunder shall thereby be discharged and the
Bonds shall no longer be deemed to be Outstanding within the
meaning of this Ordinance. There shall be deemed to be such due
payment when the City has prepaid in whole all of its obligations
under the Loan Agreement.
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Section 10. Default Provisions and Remedies of Bond
Owners.
A. Events of Default. Each of the events described in
Section 5. 01 of the Loan Agreement is hereby declared to be and to
constitute an Event of Default hereunder.
B. Remedies for Defaults. Upon the happening and
continuance of any Event of Default, the Authority may proceed
against the City to protect and to enforce its rights under this
Ordinance or the Loan Agreement as provided in the Loan Agreement
or by mandatory injunction or by other suit, action, or special
proceedings in equity or at law, in any court of competent
jurisdiction, either for the appointment of a receiver or an
operating trustee or for the specific performance of any covenant
or agreement contained herein or in the Loan Agreement or for any
proper legal or equitable remedy as the Authority may deem most
effectual to protect and to enforce the rights aforesaid, or
thereby to enjoin any act or thing which may be unlawful or in
violation of any right of any Owner of any Bond, or to require the
City to act as if it were the trustee of an expressed trust, or any
combination of such remedies, or as otherwise may be authorized by
any statute or other provision of law. All such proceedings at
law or in equity shall be instituted, had and maintained for the
equal benefit of the Authority and all Owners of any Additional
Parity Bonds or other Parity Securities then Outstanding. Any
receiver or operating trustee appointed in any proceedings to
protect the rights of the Authority and such Owners hereunder may
collect, receive and apply all Income arising after the appointment
of such receiver or operating trustee in the same manner as the
City itself might do. The consent to any such appointment is
hereby expressly granted by the City.
C. Rights and Privileges Cumulative. The failure of
the Authority to proceed in any manner herein provided shall not
relieve the City or any of its officers, agents or employees of any
liability for failure to perform to carry out any duty, obligation
or other commitment. Each right or privilege of the Authority is
in addition and is cumulative to any other right or privilege, and
the exercise of any right or privilege by or on behalf of the
Authority shall not be deemed a waiver of any other right or
privilege of the Authority. The Authority shall be entitled to all
of the privileges, rights and remedies provided or permitted in
this Ordinance or the Loan Agreement and as otherwise provided or
permitted by law or in equity or by statute, except as provided in
Sections 12A and 12B hereof, and subject to the applicable
provisions concerning the Income and the proceeds of the Bonds.
Nothing herein affects or impairs the right of the Authority to
enforce the payment of the Debt Service Requirements due in
connection with the Bonds or the obligation of the City to pay the
Debt Service Requirements of the Bonds at the time and the place
expressed herein or in the Loan Agreement or the Bonds.
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D. Duties Upon Default. Upon the happening of any
Event of Default, the City, in addition, will do and perform all
proper acts on behalf of and for the Authority to protect and to
preserve the security created for the payment of the Bonds and to
insure the payment of the Debt Service Requirements of the Bonds
promptly as the same become due. If the City fails or refuses to
proceed as in this Section 10D provided, the Authority, after
demand in writing, may proceed to protect and to enforce its rights
as hereinabove provided; and to that end the Authority shall be
subrogated to all rights of the City under any agreement or
contract involving the Net Pledged Revenues entered into prior to
the effective date of this Ordinance or thereafter while any of the
Bonds are Outstanding. Nothing herein requires the City to proceed
as provided herein if it determines in good faith and without any
abuse of its discretion that if it so proceeds it is more likely
than not to incur a net loss rather than a net gain or such action
is likely to affect materially and prejudicially the Authority and
the Owners of any Outstanding Parity Securities.
Section 11. Amendment of Ordinance.
A. Amendment of Ordinance Not Requiring Consent of the
Authority. The City may, without the consent of, or notice to, the
Authority, adopt such ordinances supplemental hereto (which
amendments shall thereafter form a part hereof) for any one or more
or all of the following purposes:
(1) To cure or correct any formal defect, ambiguity
or inconsistent provision contained in this Ordinance;
(2) To designate a trustee for the Owners of the
Bonds, to transfer custody and control of the Income to such
trustee, and to provide for the rights and obligations of such
trustee;
(3) To add to the covenants and agreements of the
City or the limitations and restrictions on the City set forth
herein;
(4) To pledge additional revenues, properties or
collateral to the payment of the Bonds;
(5) To cause this Ordinance to comply with the
Trust Indenture Act of 1939, as amended from time to time; or
(6) To effect any such other changes hereto which
do not in the opinion of nationally recognized bond counsel
materially adversely affect the interests of the Owners of the
Bonds.
B. Amendment of Ordinance Requiring Consent of the
Authority. Exclusive of the amendatory ordinances covered by
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Section 11A hereof, this Ordinance may be amended or modified by
ordinances or other instruments duly adopted by the Council,
without receipt by it of any additional consideration, but with the
written consent of the Authority, provided that no such amendatory
ordinance shall permit:
(1) Increased or Accelerated Payment. An increase
in the amounts payable on any Maturity Date or Interest
Payment Date or an acceleration of the time for payment of
such amounts; or
(2) Prior Lien. The creation of a lien upon or a
pledge of revenues ranking prior to the lien or to the pledge
created by this Ordinance; or
(3) Priorities Among Bonds and Parity Securities.
The establishment of priorities as among Bonds and other
Parity Securities.
C. Unanimous Consent. Notwithstanding anything in the
foregoing provisions contained, the terms and the provisions of
this Ordinance, or of any ordinance or instrument amendatory
thereof, and the rights and the obligations of the City and of the
Authority and the Owners of any Additional Parity Bonds or other
Parity Securities may be modified or amended in any respect upon
the adoption by the City and upon the filing with the City Clerk of
an instrument to that effect and with the consent of the Authority
and the Owners of all the then Outstanding Additional Parity Bonds
or other Parity Securities.
D. Notation on Bonds. After the effective date of any
action taken as provided in Section 11B hereof, new Bonds so
modified as in the opinion of the Council to conform to such action
shall be prepared, executed and delivered and, upon demand of the
City or the Authority, shall be exchanged without cost for Bonds
then Outstanding upon surrender of such Outstanding Bonds.
Section 12. Miscellaneous.
A. Character of Agreement. None of the covenants,
agreements, representations, or warranties contained herein or in
the Bonds shall ever impose or shall be construed as imposing any
liability, obligation, or charge against the City (except for the
special funds pledged therefor) or against the general credit of
the City payable out of general funds or out of any funds derived
from general property taxes.
B. No Pledge of Property. The payment of the Bonds is
not secured by an encumbrance, mortgage or other pledge of property
of the City except for the Net Pledged Revenues. No property of
the City, subject to such exception with respect to the Net Pledged
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Revenues, pledged for the payment of the Bonds, shall be liable to
be forfeited or taken in payment of the Bonds.
C. Statute of Limitations. No action or suit based
upon any Bond or other obligation of the City shall be commenced
after it is barred by any statute of limitations pertaining
thereto. Any moneys from whatever source derived remaining in any
fund or account reserved, pledged or otherwise held for the payment
of any such obligation, action or suit, the collection of which has
been barred, shall revert to the Sewer Fund. Nothing herein
prevents the payment of the Bonds or other obligation after an
action or suit for its collection has been barred if the Council
deems it in the best interests of the City or the public so to do
and orders such payment to be made.
D. Delegated Duties. The officers of the City are
hereby authorized and directed to enter into such agreements and
take all action necessary or appropriate to effectuate the
provisions of this ordinance and to comply with the requirements of
law, including, without limitation:
(1) Preparation of Bonds. The preparation of
typewritten Bonds in the form specified in Exhibit D of the
Loan Agreement;
(2) Execution Registration and Delivery of Bonds.
The execution and registration of the Bonds and the delivery
of the Bonds to the Authority pursuant to the provisions of
this Ordinance;
(3) Information. The assembly and dissemination to
the Authority of financial and other information concerning
the City and the Bonds;
(4) Closing Certificates. The execution of such
certificates as may be reasonably required by the Authority,
relating, inter alia, to:
(a) The signing of the Bonds;
(b) The tenure and identity of the officials
of the City;
(c) If in accordance with fact, the absence of
litigation, pending or threatened, affecting the validity
of the Bonds;
(d) The delivery of the Bonds and the receipt
of the Bond proceeds; and
(e) the use of the Bond proceeds and the
investment thereof pending such use.
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E. Authorization and Approval of Documents. Appendix C
to the official statement pertaining to the bonds of the Authority
issued to finance the loan to the City under the Loan Agreement and
Exhibit I thereto are hereby approved. The underwriters of said
bonds of the Authority are hereby authorized to use and distribute
said Appendix C and Exhibit I thereto in connection with said
official statement. The Financial Officer of the City is hereby
authorized to execute and deliver to said underwriters a
certificate deeming final said Appendix C and Exhibit I thereto.
F. Successors. whenever herein the City is named or is
referred to, such provision shall be deemed to include any
successors of the City, whether so expressed or not. All of the
covenants, stipulations, obligations and agreements by or on behalf
of and other provisions for the benefit of the City contained
herein shall bind and inure to the benefit of any officer, board,
district, commission, authority, agency, instrumentality or other
Person or Persons to whom or to which there shall be transferred by
or in accordance with law any right, power or duty of the City or
of its respective successors, if any, the possession of which is
necessary or appropriate in order to comply with any such
covenants, stipulations, obligations, agreements or other
provisions hereof.
G. Rights and Immunities. Except as herein otherwise
expressly provided, nothing herein expressed or implied is intended
or shall be construed to confer upon or to give to any Person,
other than the City and the Authority, any right, remedy or claim
under or by reason hereof or any covenant, condition or stipulation
hereof. All the covenants, stipulations, promises and agreements
herein contained by and on behalf of the City shall be for the sole
and exclusive benefit of the City and the Authority.
No recourse shall be had for the payment of the Debt
Service Requirements of the Bonds or for any claim based thereon or
otherwise upon this Ordinance authorizing their issuance or any
other ordinance or instrument pertaining thereto, against any
individual member of the Council, or any officer or other agent of
the City, past, present or future, either directly or indirectly
through the City, or otherwise, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any
penalty or otherwise, all such liability, if any, being by the
acceptance of the Bonds and as a part of the consideration of their
issuance specially waived and released.
H. Ordinance Irrepealable. This Ordinance is, and
shall constitute, a legislative measure of the City and after any
of the Bonds are issued, this Ordinance shall constitute an
irrevocable contract between the City and the Owner or Owners of
the Bonds; and this Ordinance, subject to the provisions of
Sections 9 and 11 hereof, if any Bonds are in fact issued, shall be
and shall remain irrepealable until the Bonds, as to all Debt
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Service Requirements, shall be fully paid, cancelled and
discharged, as herein provided.
I. Ratification. All action not inconsistent with the
provisions of this Ordinance heretofore taken by the City or its
officers, and otherwise by the City directed toward the issuance of
the Bonds and the execution of the Loan Agreement is hereby
ratified, approved and confirmed.
J. Repealer. All ordinances, resolutions, bylaws,
orders, and other instruments, or parts thereof, inconsistent
herewith are hereby repealed to the extent only of such
inconsistency. This repealer shall not be construed to revive any
ordinance, resolution, bylaw, order, or other instrument, or part
thereof, heretofore repealed.
K. Severability. If any section, subsection,
paragraph, clause or other provision of this Ordinance shall for
any reason be held to be invalid or unenforceable, the invalidity
or unenforceability thereof shall not affect any of the remaining
sections, subsections, paragraphs, clauses or provisions of this
Ordinance.
READ, AMENDED, FINALLY PASSED AS AMENDED ON SECOND
READING AND ORDERED PUBLISHED ONCE BY NUMBER AND TITLE ONLY this
21st day of July, 1992.
CITY OF FORT COLLINS, COLORADO
By:
(CITY) Mayor
(SEAL)
ATTEST:
City Clerk '
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Council Member Edwards seconded the motion.
The question being upon the amendment of Ordinance
No. 75, 1992, the roll was called with the following results:
Council Members voting "AYE" : Susan E. Kirkpatrick
Ann Azari
Dave Edwards
Loren R. Maxey
Council Members voting "NAY" : None
The Mayor declared that, a majority of the Council
Members present having voting in favor thereof, the motion was
carried and Ordinance No. 75, 1992, duly amended.
Council Member Azari then moved the final passage of
Ordinance No. 75, 1992, as amended.
Council Member Edwards seconded the motion.
The question being upon the final passage of Ordinance
No. 75, 1992, as amended, the roll was called with the following
results:
Council Members voting "AYE" : Susan E. Kirkpatrick
Ann Azari
Dave Edwards
Loren R. Maxey
Council Members voting "NAY" : None
The Mayor thereupon declared that a majority of the
Council Members present having voted in favor thereof, the motion
was carried and Ordinance No. 75, 1992, finally passed as amended.
The Council deeming it appropriate, the Mayor ordered
Ordinance No. 75, 1992, published by number and title only together
with a statement that the text thereof is available for public
inspection and acquisition in the office of the City Clerk and a
notice of the final passage of the Ordinance in The Coloradoan, a
newspaper of general circulation published in the City, within
seven (7) days after final passage.
67
After consideration of other business to come before the
Council the meeting was adjourned.
Mayor
City of Fort Collins, Colorado
(CITY)
(SEAL)
ATTEST:
City Clerk `
City of Fort Collins, Colorado
68
STATE OF COLORADO )
COUNTY OF LARIMER ) ss.
CITY OF FORT COLLINS )
I, Wanda M. Krajicek, City Clerk of the City of Fort
Collins, Colorado, do hereby certify that the attached copy of
Ordinance No. 75, 1992, is a true and correct copy; that the
Ordinance was introduced and approved on first reading by the
Council of the City of Fort Collins, Colorado, at a regular meeting
thereof held at Council Chambers, City Hall, 300 West LaPorte
Avenue, Fort Collins, Colorado, the regular meeting place thereof,
on Tuesday, the 7th day of July, 1992 ; that the Ordinance was
amended and finally passed as amended on second reading by the
Council at a regular meeting thereof held at Council Chambers, City
Hall, 300 West LaPorte Avenue, Fort Collins, Colorado, the regular
meeting place thereof, on Tuesday, the 21st day of July, 1992; that
a true copy of the Ordinance has been authenticated by the
signatures of the Mayor of the City and myself as City Clerk
thereof, sealed with the seal of the City, and numbered and
recorded in a book marked "Ordinance Record" kept for that purpose
in my office; that the Ordinance was duly published by number and
title only together with a statement that the text thereof was
available for public inspection and acquisition in the office of
the City Clerk and a notice giving the date when the Ordinance
would be presented for final passage and again by number and title
only together with a statement that the text thereof was available
for public inspection and acquisition in the office of the City
Clerk and a notice of the final passage thereof in The Coloradoan,
a newspaper of general circulation published in the City, in its
issues of July 12, 1992, and July 26, 1992, as evidenced by the
certificates of the publisher attached hereto at pages 70 and 71.
I further certify that the foregoing pages 1 through 68, inclusive,
constitute a true and correct copy of the record of the proceedings
of the Council at its aforesaid regular meetings, insofar as the
proceedings relate to the Ordinance; that the proceedings were duly
had and taken, that the meetings were duly held; and that the
persons were present at the meetings as therein shown.
IN WITNESS WHEREOF, I have hereunto set my .hand and the
seal of the City of Fort Collins, Colorado, this day of July,
1992 .
� ��1,K.4kCs.JR
(CITY) City Clerk T�
(SEAL) City of Fort Collins, Colorado
69