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Ordinance 2450CITY OF EDMONDS, WASHINGTON ORDINANCE. NO. 2450 AN ORDINANCE relating to the combined water and sewerage systems comprising the waterworks utility of the City; specifying and adopting a plan or system for the acquistion of certain additions and better- ments to and extensions and improvements of such waterworks utility of the City; declaring the esti- mated cost thereof as nearly as may be; providing for the issuance of $194,075 par value of "Water and Sewer Revenue Bonds, 1984," for the purpose of providing the funds to carry out such plan or system adopted herein; fixing the date, form, denomination, maturity, interest rates, terms and covenants of such bonds; and providing for the sale and delivery of such bonds to Rainier National Bank, Everett office, Everett, Washington. WHEREAS, the City Council has determined it is necessary and in the best interest of the City that certain additional. improvements and acquisitions be made to the combined water and sewerage system comprising the waterworks utility of the City (the "System") and there be adopted a system or plan of addi- tions to and betterments and extensions of this System and that $194,075 par value of water and sewer revenue bonds be issued on the terms and conditions herein set forth to provide the funds to pay the cost of carrying out such improvements; and WHEREAS, Rainier. National Bank, Everett office, Everett, Washington, has made an offer to purchase such bonds on the terms and conditions hereinafter set forth; NOW, THEREFORE, THE CITY COUNCIL. OF THE CITY OF EDMONDS, WASHINGTON, DO ORDAIN AS FOLLOWS: 0� Section 1. As used in this ordinance, the following words shall have the following meanings. (a) "Bond Fund" shall mean the special fund of the City known as the "Water and Sewer Revenue Bond Fund, 1984," created by Section 5 of this ordinance for the payment of the principal of and interest on the Bonds. (b) "Bonds" shall mean the $194,075 par value of "Water and Sewer Revenue Bonds, 1984," of the City authorized to be issued by this ordinance. (c) "Bond Registrar" shall mean the Finance Director of the City. (d) "City" shall mean the City of Edmonds, Washington, a duly organized and legally existing non -charter code city under the laws of the State of Washington. (e) "Operating and Maintenance Expense" shall mean all reasonable expenses incurred by the City in causing the System to be operated and maintained in good repair., working order and condition, but shall not include any depreciation or taxes or charges in lieu of taxes levied or imposed by the City. (f) "Prior Lien Bonds" shall mean the outstanding "Water and Sewer Revenue Refunding and Construction Bonds, 1977," of the City issued under date of November 1, 1977 pursuant to Ordinance No. 1957 and the "Water and Sewer Revenue Bonds, 1983," of the City issued under date of May 1, 1983, pursuant to Ordinance No. 2363, and any bonds hereafter issued on a parity of lien with such bonds. - 2 - (g) "Revenue of the System" shall mean all the earnings and revenue received by the System from any source whatsoever except general ad valorem taxes, utility local improvement district assessments, proceeds from the sale of City property and bond proceeds. (h) "System" shall mean the combined water supply and distribution system and sanitary sewage disposal system of the City as the same may be added to, improved and extended for as long as any of the Bonds are outstanding. Section 2. The City specifies, adopts and orders the carrying out of a system or plan for the acquisition of addi- tions and betterments to and extensions and improvements of the System consisting of the purchase of approximately one acre of real property adjacent to the existing Sewage Treatment Plant and the acquisition of a share of a computer capable of serving both general City needs and the needs of the System. The life of the improvements comprising the foregoing system or plan of additions to and betterments and extension of the System is declared to be at least three years. The esti- mated cost of the acquisition of the above -described improve- ments is declared to be approximately $294.500, such cost to be paid from the proceeds of the issuance and sale of the bonds authorized by this ordinance and $100,425 from the proceeds of limited tax general obligation bonds issued simultaneously with the Bonds. - 3 - Section 3. For the purpose of providing a part of the money required to carry out the plan or system for the acquisi- tion of the additions and betterments to and extensions and improvements of the System herein specified, adopted and ordered to be carried out, the City shall issue the Bonds in the aggre- gate principal amount of $194,075. The Bonds shall be designated "Water and Sewer Revenue Bonds, 1984" (herein defined as the "Bonds"); shall be dated as of the date of their delivery to the purchaser; and shall be numbered 1 and 2. Bond No. 1 shall be in the denomination of $140,000 and Bond No. 2 shall be in the denomination of $54,075. Bond No. 1 shall bear interest payable annually on August 1, beginning August 1, 1985, to maturity or earlier redemption of such Bond. Interest shall accrue at a rate equal to 66% of Rainier National Bank's announced prime rate, adjusted daily with any changes in that prime rate, computed on the basis of a 360-day year of twelve 30-day months. Principal shall be pay- able in three annual installments on August 1 of each year as follows: Installment Payment Date Principal Amount August 1, 1985 $46,666.00 August 1, 1986 46,667.00 August 1, 1987 46,667.00 Bond No. 2 shall bear interest payable annually on August 1, beginning August 1, 1985, to maturity or earlier redemption of such Bond. Interest shall accrue at a rate equal to 67% of. Rainier National Bank's announced prime rate, adjusted quarterly - 4 - on November 1, 1984, and thereafter on the first business day of each calendar quarter (i.e. November 1, February 1, May 1 and November 1), with any changes in that prime rate, computed on the basis of a 360-day year of twelve 30--day months. Principal shall be payable in three annual installments of $1.8,025 each, payable August 1, 1985, August 1, 1986, and August 1, 1987. If any installment of either Bond is not paid when due, the City shall be obligated to pay interest at the then applicable percentage of prime rate from and after that installment date until such installment, with interest, is paid in full or until sufficient money for such payment in full is on deposit in the Bond Fund hereinafter created, and such Bond has been called for redemption. If the Bonds are not paid in full on the last installment date upon proper presentment, the City shall be obligated to pay interest at Rainier National Bank's announced prime rate until the Bonds are paid in full or sufficient money for such payment in full is on deposit in the Bond Fund and the Bonds have been called for redemption in the manner set forth in Section 4. The Bonds shall be issued only in registered form as to both principal and interest on books or records (the "Bond Register") maintained by the City Finance Director, the Bond Registrar for the Bonds. Such Bond Register shall contain the name and mailing address of the owner of the Bonds. The Bonds shall not be assignable or transferable by the registered purchaser. - 5 - Both principal of and interest on the Bonds shall be payable in lawful money of the United States of America at the Everett office of Rainier National Bank, the registered purchaser, solely out of the Bond Fund. The Bonds are not general obligations of the City. The City Council declares that fixing the above interest indices is in the best interest of the City. Section 4. The City reserves the right to prepay the remaining principal of the Bonds in whole or in part in inverse order of installments at any time, at par plus accrued interest on the principal being prepaid to the date of such prepayment. Such partial prepayments shall be applied to the unpaid princi- pal for the last unpaid maturity of the Bonds until the unpai.d principal amount for that maturity date for Bond No. 1 and Bond No. 2 are paid in full. Notice of any prepayment shall be given by registered or certified mail deposited in the United States mail not less than 15 days prior to the date fixed for such prepayment to the Everett office of Rainier National Bank or its successor. Interest on any bond so prepaid shall cease on such prepayment date upon payment of the prepayment amount into the Bond Fund and, if a partial prepayment, mailing the same to the owner of the Bond in the manner of interest payments. Section 5. There is created in the office of the City Finance Director a special fund to be known and designated as the "Water and Sewer Revenue Bond Fund, 1984" (herein defined as - 6 - the "Bond Fund"). So long as either of the Bonds is outstanding against the Bond Fund, the City Director of Finance shall set aside and pay into the Bond Fund out of the Revenue of the System deposited in the Water and Sewer Operating Fund of the City prior to each principal and interest payment date an amount sufficient to pay the principal installment and interest due on such principal and interest payment date. In the judgment of the City Council the revenue of. the System anticipated to be derived from the operation and main- tenance of the System will be more than sufficient to pay Operating and Maintenance Expense and the debt service require- ments of the outstanding Prior. Lien Bonds and permit the setting aside into the Bond Fund out of the Revenue of. the System of sufficient money to pay the principal and interest on the Bonds when due. The City Council further declares that in fixing the amounts to be paid into the Bond Fund it has considered and had due regard for Operating and Maintenance Expense and has not set aside into the Bond Fund a greater amount or proportion of the Revenue of the System than in its judgment will be available over and above Operating and Maintenance Expense and the debt service requirements of the Prior Lien Bonds and that no portion of the Revenue of the System has been previously pledged for any other outstanding indebtedness except for payment of the Prior Lien Bonds. - 7 - Section 6. All Revenue of the System is pledged to the payments required to be made into the Bond Fund and the Bonds shall constitute a charge and lien upon such revenue prior and superior to all other charges and liens whatsoever, excluding Operating and Maintenance Expense, except that the charge and lien upon such revenue for the Bonds shall be junior to the prior charge and lien upon such revenue of the Prior Lien Bonds. Section 7. The City covenants and agrees with the owner of each Bond at any time outstanding as follows: (a) It will establish, maintain and collect such rates and charges for water and sanitary sewage disposal service so long as any of the Bonds are outstanding which, together with other miscellaneous revenue of the System, will provide amounts annually sufficient to pay Operation and Maintenance Expense, to meet the debt service requirements of the out- standing Prior Lien Bonds and Bond No. 2, and in addition to equal more than 1.25 times the annual. debt service requirement on Bond No. 1. (b) It will pay all Operating and Maintenance Expense and otherwise meet the obligations of the City as herein set forth. (c) It will spend the proceeds of the Bonds with due diligence to completion of the purpose specified herein and will make no use of the proceeds of the Bonds or other funds of. the City at any time during the term of the Bonds which will cause such Bonds to be arbitrage bonds within the meaning of Section 103(c) of the United States Internal Revneue Code of 1954, as amended, and applicable regulations thereunder.. Section 8. The Bonds shall be typewritten or multicopied on lithograph or good bond paper in a form consistent with the provisions of this ordinance. The Bonds shall be signed by the Mayor and City Clerk and the City's seal shall be impressed thereon. Only such Bonds as shall bear thereon a Certificate of Authentication in the following form, manually executed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of this ordinance: CERTIFICATE OF AUTHENTICATION This bond is the fully registered City of Edmonds, Washington, Water and Sewer. Revenue Bond, 1984, described in the within mentioned ordinance. LM City Finance Director Bond Registrar Such Certificate of Authentication shall be conclusive evidence that the Bonds so authenticated have been duly executed, authen- ticated and delivered and are entitled to the benefits of this ordinance. The Bonds shall negotiable instruments to the extent pro- vided by RCW 62A.8-102 and 62A.8-105. All Bonds for which payment in full has been made shall be surrendered by the registered owner to the Bond Registrar who shall destroy the same one month after the date of receipt of such Bond. Upon destruction, the Bond Registrar shall furnish to the City a certificate of destruction and no further Bonds shall be exe- cuted or authenticated or issued in exchange or substitution therefor. Section 9. In the event the City shall issue advance refunding bonds pursuant to the laws of the State of Washington, or have money available from any other lawful source, to pay the - 9 - principal of and interest on the Bonds or such portion thereof included in the refunding plan as the same become due and pay- able and to refund all such then outstanding Bonds and to pay the costs of refunding, and shall have irrevocably set aside in a special fund for and pledged to such payment and refunding money and/or direct obligations of the United States of America or other legal investments sufficient in amount, together with known earned income from the investment thereof, to make such payments and to accomplish the refunding as scheduled (herein- after called the "trust account") and shall make irrevocable provisions for redemption of such Bonds, then in that case all right and interest of the owners of. the Bonds to be so retired or refunded and the appurtenant coupons (hereinafter collec- tively called the "defeased Bonds") in the covenants of this ordinance and in the Revenue of the System obligated to the payment of such Bonds shall thereafter cease and become void, except such owners shall have the right to receive payment of the principal of and interest on the defeased Bonds from the trust account and, in the event the funds in the trust account are not available for such payment, shall have the residual right to receive payment of the principal of and interest on the defeased Bonds from the Revenue of the System without any prior- ity of lien or charge against that revenue or covenants with respect thereto except to be paid therefrom. After the estab- lishing and full funding of such trust account, the City may then apply any money in any other fund or account established - 10 - for the payment or redemption of the defeased Bonds to any lawful purposes as it shall determine, subject only to the rights of the owners of any other bonds then outstanding. Section 10. Rainier National Bank, Everett office, Everett, Washington, has submitted its written offers to pur- chase the Bonds at a price of par plus accrued interest to the date of delivery of the Bonds, the City to furnish the printed Bonds and the unqualified approving legal opinion of Roberts & Shefelman, municipal bond counsel of Seattle, Washington. Bond counsel shall not be required to review or express any opinion concerning the completeness or accuracy of any official state- ment, offering circular or other sales material issued or used in connection with the Bonds and bond counsel's opinion shall so state. The City Council being of the opinion that it is in the best interest of the City to accept such offer, accepts the same. The Bonds, therefor, immediately upon their execution shall be delivered to the purchaser upon payment therefor in accordance with such offer. The accrued interest received, if any, shall be deposited in the Bond Fund and the principal proceeds received from the issuance of the sale of the Bonds shall be deposited in the appropriate fund of the City and used for the purposes set forth in Section 3. Pending the expendi- ture of such principal proceeds the money in such fund may be invested in any legal investment and the investment income may be retained in such fund and used for the purposes of that fund. Section 11. This ordinance shall take effect after its passage and five days following its publication as required by law. PASSED by the City Council of the City of. Edmonds, Washington at a regular open public meeting thereof and approved by the Mayor this 7th day of August, 1984. CITY OF EDMONDS, WASHINGTON By , , - Mayof Pro Tem ATTEST: FORM APPROVED: � � � , 5'm - / -� City Attorney 0315e FILED WITH THE CITY CLERK: August 3, 1984 PASSED BY THE CITY COUNCIL: August 7, 1984 POSTED: August 8, 1984 EFFECTIVE DATE: August 12, 1984 ORDINANCE: 2450 - 12 - AFFIDAVIT OF POSTING ORDINANCE STATE OF WASHINGTON ss: COUNTY OF SNOHOMISH JACQUELINE G. PARRETT , being first duly sworn on oath deposes and says that the is over the age of eighteen (18) years and is competent to testify as to the matter stated herein. There is no official newspaper or other newspaper printed and published within the City. In accordance with RCW 35A.12.160, on the 8th day of August , 1984, affiant posted true and correct copies of the attached Ordinance No.2450 , passed by the City Council on the 7th day of August , 1984, at the official posting places for City notices which are the public bulletin boards at the following locations: Edmonds Civic Center 250 Fifth Avenue North Edmonds, Washington 98020 Edmonds Public Library Civic Center, 250 Fifth Avenue North Edmonds, Washington 98020 Edmonds Branch of United States Post Office .201 Main Street Edmonds, Washington 98020 DATED this 9th day of August , 1984. SUBSCRIBED AND SWORN to before me this 9th day of August . 19 84. Lary Public in and for the State of Washington, residing at 6 ��a)�z_