HomeMy WebLinkAbout109 - 09/06/1977 - TO CONTRACT AN INDEBTEDNESS ON BEHALF OF THE CITY BY ISSUING GENERAL OBLIGATION BONDS IN THE PRINCIP ORDINANCE NO. 109, 1977
AN ORDINANCE TO CONTRACT AN INDEBTEDNESS ON
BEHALF OF THE CITY OF FORT COLLINS, COLORADO,
AND UPON THE CREDIT THEREOF BY ISSUING GENERAL
OBLIGATION BONDS OF THE CITY IN THE PRINCIPAL
AMOUNT OF $ 5, 000 , 000 , FOR THE PURPOSE OF EX-
TENDING AND IMPROVING THE MUNICIPAL WATERWORKS
SYSTEM OF THE CITY, PRESCRIBING THE FORM OF SAID
BONDS , PROVIDING FOR THE LEVY OF TAXES AND
THE PLEDGE OF THE NET INCOME AND REVENUE OF THE
SYSTEM TO PAY THE BONDS AND THE INTEREST THERE-
ON , PROVIDING OTHER DETAILS IN CONNECTION
THEREWITH, AND DECLARING AN EMERGENCY
WHEREAS , the City of Fort Collins presently owns
and operates a municipal waterworks system ( sometimes referred to
as the "system" ) for the City and its inhabitants, and
WHEREAS , the City Council has determined that it is
necessary to extend and improve the system, and
WHEREAS , the estimated cost of such improvements is
approximately $5, 000, 000, and the City Council has determined that
general obligation bonds of the City in the amount not exceeding
$5, 000, 000 should be issued for such purpose, and
WHEREAS, Section 20 3 of the City Charter provides in
part that securities issued for water purposes may be issued by
Council action without an election and shall not be included in
the determination of the debt limitation, and
WHEREAS , the City Council has determined that the
proposed issue of general obligation bonds will be for the purpose
of improving or extending the municipal waterworks system of the
City, and therefore pursuant to the City Charter, no election is
required prior to the issuance thereof , and
WHEREAS, by a resolution previously passed and adopted
by the City Council , notice of sale of bonds has been published in
accordance with law, and all bids received prior to 10 00 A.M on
Tuesday , September 6 , 1977 , have been opened and tabulated ;
and
WHEREAS , the City Council has awarded the bonds to
First National Bank of Oregon
the highest and best bidder for the purchase thereof, and
WHEREAS, the City Council has determined at this time
to authorize the issuance of bonds in the principal amount of
$5 , 000 , 000,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS, COLORADO-
Section 1 Bond Details . That for the purpose of
extending and improving the municipal waterworks system of the
City , the City shall issue its general obligation negotiable
coupon bonds in the principal amount of $5, 000, 000 , each to be
designated "General Obligation Water Bond , Series 1977" , ( referred
to herein as the " 1977 Bonds" or the "bonds" )
14 -
(e ) The City shall cause all rates, fees and service
charges appertaining to the system to be collected as soon as
reasonable, shall prescribe and enforce rules and regulations for
the payment thereof and for the connection with and the discon-
nection from properties of the system, and shall provide methods
of collection and penalties , including but not limited to denial
of service for non-payment of such rates , fees and service
charges , to the end that net revenues of the system shall be
adequate to meet the requirements hereof
( f ) At regular periods each year it will render bills
for water services furnished Until paid , all water rates, fees,
tolls and charges shall constitute a lien on the property served ,
and the City shall take whatever action is legally permissible
promptly to enforce and collect delinquent water rates , fees ,
tolls and charges , and to enforce said liens
(g ) At least once each year it will furnish Boettcher
and Company , Denver, Colorado, and the purchaser of the 1977
Bonds, with a complete statement of the receipts and disbursements
of and for the system for the fiscal year immediately preceding
such statements
( h ) It will carry workmen ' s compensation, public
liability and other forms of insurance on insurable system prop-
erty , in such amounts as is customarily carried on prudently
operated systems of like character
Section 7 Severability That if any one or more
sections or parts of this Ordinance shall be adDudged unen-
forceable or invalid , such 3udgment shall not affect, impair or
invalidate the remaining provisions of this Ordinance , it being
the intention that the various provisions -hereof are severable .
Section 8 Repealer All ordinances or parts thereof
in conflict with this Ordinance are hereby repealed
Section 9 Ordinance Irrepealable. After the bonds are
issued , this Ordinance shall be and remain Irrepealable until said
bonds and the interest thereon shall have been fully paid, sat-
isfied and discharged
Section 10 Declaration of Emergency That in order to
take advantage of the favorable bond market and to complete the
issuance and sale of the bonds to the purchaser thereof at the
earliest possible date, so that funds will be available for the
payment of the costs of the extensions and improvements, it is
hereby declared that an emergency exists and that this ordinance
is necessary for the preservation of public peace , health ,
safety and property , shall take effect upon passage, and be
published within five ( 5 ) days following the passage hereof .
- 23 -
Section 11 Publication This Ordinance , after its
passage , shall be numbered and recorded , and the adoption and
publication shall be authenticated by the signature of the Mayor
and the City Clerk, and by the Certificate of Publication
Introduced and finally passed and adopted this 6th day of September -
A D 1977
( S E A L )
ATTEST Mayor
City C e
i
- 24 -
The City Council has determined that the 1977 Bonds
authorized herein, in the principal amount of $5, 000, 000, are not
included within the debt limitation of the City, in accordance
with Section 20 3 of the City Charter, which exempts from the debt
limitation bonds issued for water purposes
The 1977 Bonds shall be dated October 1 , 1977 and
consist of 1 , 000 bonds in the denomination of $5, 000 each, num-
bered 1 to 1 , 000, inclusive The net effective interest rate of
this issue of bonds is 4 84 % per annum. Interest shall be
payable on April 1 , 1978, and semi-annually thereafter on the 1st
day of April and the 1st day of October each year, as evidenced by
interest coupons attached to said bonds at the rates set forth
below , and the bonds shall mature serially on October 1 , as
follows
Amount Maturity Interest Rate
$ 50 , 000 1979 5 00 7
50, 000 1980 5 00
50 , 000 1981 5 00
50, 000 1982 5 00 9
50 , 000 1983 5 00 %
50, 000 1984 5 00
175, 000 1985 5 00 9
250 , 000 1986 4 50
275 , 000 1987 4 50
300 , 000 1988 4 50 9
$325 , 000 1989 4 60 9
350 , 000 1990 4 75 %
375, 000 1991 4 75
400 , 000 1992 4 75 7
400 , 000 1993 4 90
425, 000 1994 4 90
$450 , 000 1995 5 00 9
475 , 000 1996 5 00
500 , 000 1997 5 00 9
Bonds maturing on or before October 1 , 1988 , shall
not be redeemable prior to their respective maturity dates
Bonds maturing in the years 1989 and thereafter, shall be re-
deemable at the option of the City on October 1 , 1988, and on any
interest payment date thereafter, in inverse numerical order, upon
payment of par , accrued interest and the following redemption
premium
28 of principal , if redeemed from October 1 ,
1988 to April 1 , 1990, inclusive,
1% of principal , if redeemed from October 1 ,
1990 to April 1 , 1992, inclusive,
at par and accrued interest only if redeemed
on or after October 1 , 1992
- 15 -
Notice of prior redemption shall be given by publication
at least one time in a newspaper having general circulation in
the City of Fort Collins, not less than thirty (30 ) days prior to
the date of redemption, and notice shall also be given by mailing
a copy of the notice by registered , first class mail , to the
original purchaser of the bonds , at least thirty (30 ) days prior
to the date of redemption
The bonds and the interest coupons attached thereto
shall be payable in lawful money of the United States of America,
at the office of the Director of Finance, in Fort Collins, Colo-
rado
Section 2 Form and Execution of Bonds and Interest
Coupons . The bonds shall be signed by the facsimile signature of
the Mayor of the City, with the facsimile of the seal of the City
appearing thereon, attested by the manual signature of the City
Clerk and countersigned with the facsimile signature of the
Director of Finance The interest coupons attached to said bonds
shall bear the facsimile signature of the Director of Finance, and
when issued as aforesaid as part of said bonds , shall be the
binding obligations of the City according to their import Should
any officer whose manual or facsimile signature appears on said
bonds or the interest coupons attached thereto cease to be such
officer before delivery of the bonds to the purchaser, such manual
or facsimile signature shall nevertheless be valid and sufficient
for all purposes
The bonds and interest coupons attached thereto shall be
in substantially the following form
- 16 -
(Form of Bond )
UNITED STATES OF AMERICA
STATE OF COLORADO COUNTY OF LARIMER
CITY OF FORT COLLINS
GENERAL OBLIGATION WATER BOND, SERIES 1977
No. $5 , 000
The City of Fort Collins , in the County of Larimer ,
State of Colorado, acknowledges itself indebted and promises to
pay to the bearer hereof the principal sum of
FIVE THOUSAND DOLLARS
on the 1st day of October, 19_, with interest thereon at the rate
of per
centum ( 8 ) per annum, payable on April 1, 1978, and semi-
annually thereafter on the 1st day of April and the 1st day of
October each year, both principal and interest being payable in
lawful money of the United States of America, at the office of the
Director of Finance, in Fort Collins, Colorado, upon presentation
and surrender of said coupons and this Bond as they severally
become due
Bonds of this issue maturing on or before October 1 ,
1988 , are not redeemable prior to their respective maturity
dates . Those bonds maturing in the years 1989 and thereafter ,
shall be redeemable at the option of the City on October 1 , 1988,
and on any interest payment date thereafter, in inverse numerical
order, upon payment of par, accrued interest and the following
redemption premium
28 of principal , if redeemed from October 1 ,
1988 to April 1, 1990, inclusive,
1% of principal, if redeemed from October 1,
1990 to April 1, 1992, inclusive,
at par and accrued interest only if redeemed
on or after October 1 , 1992.
Notice of such prior redemption shall be given in the time and
manner set forth in the ordinance authorizing the issuance of this
Bond
This Bond is issued by the City Council of the City
of Fort Collins , Colorado , for the purpose of extending and
improving the municipal waterworks system of the City, under the
authority of and in full conformity with the Constitution and Laws
of the State of Colorado, the home rule Charter of the City, and
pursuant to an Ordinance duly adopted , published and made a law of
the City prior to the issuance of this Bond
- 17 -
It is hereby certified and recited that all the re-
quirements of law have been duly complied with by the proper
officers of the City in the issuance of this Bond, that the total
debt of the City, including that of this Bond , does not exceed any
limit of indebtedness prescribed by the Constitution or Laws of
the State of Colorado or the Charter of the City, and that provi-
sion has been made for the levy and collection of a direct annual
tax (general ad valorem tax) on all the taxable property in the
City and a pledge of the net revenue of the municipal waterworks
system of the City, sufficient to pay the interest on ana princi-
pal of this Bond when the same become due .
The full faith and credit of the City of Fort Collins,
Colorado, are hereby pledged for the punctual payment of the
principal of and interest on this Bond.
IN TESTIMONY WHEREOF, the City Council of the City of
Fort Collins , Colorado, has caused this Bond to be signed with the
facsimile signature of the Mayor of the City , sealed with the
facsimile of the seal of the City, attested by the manual sig-
nature of the City Clerk and countersigned with the facsimile
signature of the Director of Finance, and the interest coupons
attached hereto to be signed with the facsimile signature of the
Director of Finance, as of the lst day of October, 1977
CITY OF FORT COLLINS, COLORADO
( FACSIMILE
S E A L ) By ( Facsimile Signature)
Mayor
ATTEST
(Manual Signature )
City Clerk
COUNTERSIGNED
( Facsimile Signature)
Director of Finance
- 18 -
(Form of Interest Coupon)
No $
April ,
On the 1st day of October , 19 unless the Bond
to which this coupon is attached, if redeemable, has been called
for prior redemption, the City of Fort Collins, in the County of
Larimer, State of Colorado, will pay to bearer the amount shown
hereon in lawful money of the United States of America, at the
office of the Director of Finance , in Fort Collins , Colorado ,
being interest then due on its General Obligation Water Bond ,
Series 1977, dated October 1 , 1977, bearing No
(Facsimile Signature)
Director of Finance
- 19 -
Section 3 Disposition of Bond Proceeds When the
bonds have been duly executed , the Director of Finance is hereby
directed to deliver the bonds to the purchaser thereof upon
receipt of the agreed purchase price therefor The proceeds of
the bonds shall be used only for the purpose of extending and
improving the municipal waterworks system of the City, and for
paying the costs and expenses incurred incidental to the issuance
of said bonds and for no other purpose whatever
All or any portion of the bond proceeds may be tem-
porarily invested , or reinvested , pending such use , in securities
or obligations which are lawful investments for such munic-
ipalities in the State of Colorado It is hereby covenanted and
agreed by the City that the temporary investment or reinvestment
of the bond proceeds , or any portion thereof, shall be of such
nature and extent, and for such period, that the bonds of the City
shall not be or become "arbitrage bonds" within the meaning of
Section 103 ( c) of the Internal Revenue Code, and pertinent reg-
ulations, and such proceeds, if so invested or reinvested, shall
be subject to the limitations and restrictions of said Section
103 ( c) , as the same now exists or may later be amended, and shall
further be subject to any applicable regulations of the Internal
Revenue Service
Neither the purchaser of the bonds nor the subsequent
holder of any of them shall be responsible for the application or
disposal by the City, or any of its officers, of any of the funds
derived from the sale thereof
Section 4 Payment of Principal and Interest If
necessary, the amount of interest due on said bonds on April 1,
1978 may be advanced from any available funds of the City, or from
the proceeds of the bonds authorized by this .Ordinance For the
purpose of reimbursing said funds and paying the interest on said
bonds as it shall thereafter become due and providing for the
ultimate payment of the bonds, there shall be levied on all the
taxable property in the City , in addition to all other taxes ,
direct annual taxes ( general ad valorem taxes ) in each of the
years 1977 to 1996, inclusive, without limitation as to rate or
amount, sufficient to make such reimbursement and pay the in-
terest on all of the bonds outstanding , and the principal thereof,
as the same become due and payable, respectively
Said taxes , when collected , shall be applied solely
for the purpose of the payment of the interest on and principal of
the 1977 Bonds and for no other purpose whatever, until the bonds
authorized by this Ordinance, both principal and interest, shall
- 20 -
have been fully paid, satisfied and discharged Nothing herein
contained shall be so construed as to prevent the City from
applying any available income or revenues of the municipal water-
works system, or any other funds or revenues that may be in the
City treasury and available for that purpose, to the payment of
said bonds and the interest thereon Upon the application of such
funds or revenues as aforesaid , the levy or levies herein provided
may thereupon to that extent be diminished
The sums herein provided to pay the interest on said
bonds and to discharge the principal thereof when due, are hereby
appropriated for that purpose , and said amounts for each year
shall also be included in the annual budget and the appropriation
bills to be adopted and passed by the City Council of the City in
each year, respectively.
It shall be the duty of the City Council of said City,
annually, at the time and in the manner provided by law for
levying other City taxes, if such action shall be necessary to
effectuate the provisions of this ordinance , to ratify and carry
out the provisions hereof with reference to the levying and
collection of taxes, and such taxes, when collected , shall be kept
for and applied only to the payment of the interest on and prin-
cipal of said bonds, as hereinabove specified
Section 5 Pledge of the Net Income and Revenue of
the Municipal Waterworks System By Ordinance No 64, 1974 , the
City Council has authorized the issuance of its General Obligation
Water Refunding Bonds , Series 1974, (hereafter referred to as the
"1974 Bonds ' ) in the principal amount of $1, 935, 000, dated De-
cember 1, 1974 In addition to the provision for a tax levy for
the payment of the 1974 Bonds , the ordinance-provides for a pledge
of the net revenue of the municipal waterworks system for the
payment of the principal of and interest on the 1974 Bonds
Similarly, the City hereby irrevocably pledges to pay the princi-
pal of and the interest on the 1977 Bonds from the net revenues of
the municipal waterworks system The City hereby reserves the
right to secure, without restriction, any water bonds and refund-
ing water bonds of the City hereafter issued equally and ratably
with the 1974 Bonds and the 1977 Bonds The City also hereby
commits itself to fix and annually to maintain rates and charges
for water and services furnished by the system which , together
with moneys on hand and available therefor, will be sufficient to
pay operation and maintenance expenses of the system and the
principal of and interest on all bonds and other obligations of
- 21 -
the system, as they respectively become due, and for the other
payments required by Art IX , Section 6 of the City Charter
The term "net revenues" as used herein refers to the
gross revenues of the system after the payment of operation and
maintenance expenses The term "operation and maintenance expen-
ses as used herein means all current reasonable and necessary
expenses of operating, maintaining and repairing the system, but
does not include any allowance for depreciation or capital re-
placements and improvements
The terms "municipal waterworks system" or "system" as
used herein shall include not only the property comprising the
waterworks system of the City of Fort Collins at the present time,
but all additions and betterments thereto and improvements and
extensions thereto which may hereafter be constructed or acquired
by the City
Section 6 . Covenants of the City The City hereby
additionally irrevocably covenants and agrees with each and every
holder of the 1977 Bonds that so long as any of said bonds remain
outstanding
( a) It will continue to operate and manage the system
in an efficient and economical manner and keep and maintain
separate accounts of the receipts and disbursements thereof in
such manner that the revenues thereof may at all times be readily
and accurately determined .
( b) It will not sell or alienate any of the property
constituting any part or all of the system in any manner or to any
extent as might reduce the security provided for the payment of
the 1977 Bonds , but the City may sell any portion of such property
which shall have been replaced by other similar property of at
least equal value , or which shall cease to be necessary for
the efficient operation of the system
(c) The rates for all services rendered by the system
to the City and to its inhabitants and to all consumers within or
without the boundaries of the City shall be reasonable and ]ust ,
taking into account and consideration the cost and value of the
system and the proper and necessary allowance for the depreciation
thereof and the amounts necessary for the retirement of all bonds
and other securities or obligations payable from the revenues of
the system, and the accruing interest thereon
(d ) There shall be charged against all purchasers of
service such rates and amounts as shall be adequate to meet the
requirements of this and the preceding sections hereof , and said
rates and amounts from the system shall be sufficient to satisfy
the requirements of Section 5 hereof
22 -
I