Loading...
HomeMy WebLinkAbout101-88H . • RESOLUTION NO. 101-88 RESOLUTION AUTHORIZING ISSUANCE OF BONDS SEWER ASSESSMENT DISTRICT NO. 11 The City Council of the Town of Los Altos Hills resolves: Section 1. RECITALS. On December 16, 1987, the City Council of the Town of Los Altos Hills adopted its resolution of intention, as later amended, to order improvements in Sewer Assessment District No. 11, Town of Los Altos Hills, Santa Clara County, California, under the provisions of the Municipal Improvement Act of 1913 (the "Act") , as amended. Proceedings taken under the Act led to the levy • of a special assessment by the City Council against parcels of land within the assessment district in the total amount of $523 , 178. 00. These assessments were recorded in the office of the County Recorder of the County of Santa Clara, and thereupon became a lien on each parcel assessed. The period within which parcel owners might pay their assessments in cash without interest has expired. Section 2 . ISSUANCE OF BONDS. The City Council hereby authorizes the issuance of improvement bonds under the provisions of the Improvement Bond Act of 1915 to represent unpaid assessments in the amount of $448,438.28. The bonds shall be designated, "Limited Obligation Improvement Bond, Town of Los Altos Hills, Sewer Assessment District No. 11, Series No. 88-A. " Bonds shall be issued in denominations of $5000 or integral multiples thereof, except for Bond No. 1, which shall be an odd amount, and shall be dated October - 12, 1988. Bonds shall mature and shall bear interest at the rates set forth in the table attached as Exhibit A. Section 3 . APPOINTMENT OF PAYING AGENT, REGISTRAR AND TRANSFER AGENT. The City Council hereby appoints the Bank of America National Trust and Savings Association as paying agent, registrar and transfer agent for the bonds in accordance with an agreement between the Town of Los Altos Hills and Bank of America NT&SA. Section 4. FORM AND EXECUTION. Bonds shall be issued as fully registered bonds substantially in the form set forth as Exhibit B to this resolution. The bonds shall be signed by the City Treasurer and the City Clerk and the seal of the Town shall be affixed. Both signatures and seal may be reproduced on the bonds by facsimile, but upon its registration or reregistration each bond shall be authenticated by the manual signature of the registrar. The paying agent shall assign to each bond authenticated and registered by it a distinctive letter, or number, or letter and number, and shall maintain a record thereof which shall be available' to the Town for inspection. • • Section 5. ESTABLISHMENT OF SPECIAL FUNDS. For administering the proceeds of the sale of bonds and payment of interest and principal on the bonds, there are hereby established five funds to be known as the improvement fund, the redemption fund, the special reserve fund, the investment earnings fund and the arbitrage rebate fund, respectively, for Sewer Assessment District No. 11. Section 5. 1. IMPROVEMENT FUND. Except as provided in Section 5.3, proceeds of sale of the bonds, together with all amounts paid on the assessments prior to bond issuance, shall be deposited in the improvement fund to be maintained by the City Treasurer. Disbursements from the improvement fund shall be made by the City Treasurer in accordance with the budget of estimated costs and expenses set forth in the amended engineer's report heretofore approved by the City Council, which report and budget are subject to modification by the City Council from time to time as prescribed by the Act. Section 5.2 . REDEMPTION FUND. The redemption fund shall be maintained by the City Treasurer. All payments of principal and interest installments on the assessments, together with penalties, if any, shall be deposited in the redemption fund, which shall be a trust fund for the benefit of the bondholders. Payment of the bonds at maturity, or at redemption prior to maturity, and all interest on the bonds shall. be made from the redemption fund. , Section 5.3 . SPECIAL RESERVE FUND. The special reserve fund shall be maintained by the City Treasurer. There shall be deposited into the special reserve fund the amount of $11,210.96 (the "Reserve Requirement") from the proceeds of the sale of bonds. A. During the term of the bonds, the amount in the special reserve fund shall be available for transfer into the redemption fund in accordance with Section 8808 of the Streets and Highways Code. The amount so advanced shall be reimbursed to the special . reserve fund from the proceeds of redemption or sale of the parcel for which payment of delinquent assessment installments was made from the special reserve fund. B. If any assessment is prepaid before final maturity of the bonds, the amount of principal which the assessee is required to. prepay shall be reduced by an amount which is in the same ratio to the original amount of the special reserve fund as the original amount of the prepaid assessment bears to the total amount of assessments originally levied in Sewer Assessment District No. 11. This reduction in the amount of principal prepaid shall be balanced by a transfer from the special reserve fund to the redemption fund in the same amount. 2 • • C. The amounts deposited in the reserve fund will never exceed 10% of the proceeds of the bond issue. Proceeds of investment of the special reserve fund shall be deposited in the investment earnings fund. D. When the amount in .the special reserve fund equals or exceeds the amount required to retire the remaining unmatured bonds (whether by advance retirement or otherwise) , the amount of the special reserve fund shall be transferred to the redemption fund, and the remaining installments of principal and interest not yet due from assessed property owners shall be cancelled without payment. Section 5.4. INVESTMENT EARNINGS FUND. Proceeds of the investment of amounts in the improvement fund and the special reserve fund (and the redemption fund if its earnings exceed $100, 000 in any' bond year) will be deposited in the investment earnings fund. On July 1 of each year during the term of the bonds (or at other times as may be required or permitted by regulations of the United States Internal Revenue Service) , the Treasurer shall determine whether any portion of investment earnings must be rebated to the United States pursuant to Section 148 of the United States Internal Revenue Code and regulations adopted thereunder. Any amounts required to be rebated will be transferred to the arbitrage rebate fund, and the balance will be transferred as follows: • (a) To the extent that the balance in the special reserve fund is less than the Reserve Requirement, a transfer will be made from the investment earnings fund to the special reserve fund. (b) The remaining balance in the investment earnings fund, if any, will be transferred to the improvement fund until the improvement is completed and the improvement fund is closed; thereafter the balance in the investment earnings fund will be transferred to the redemption fund to be used, in the discretion of the City Treasurer, as a credit upon the annual installments of assessment or for the advance retirement of bonds. The City Treasurer is authorized to retain independent attorneys, accountants and other consultants to assist in complying with Federal requirements. Section 5.5. ARBITRAGE REBATE FUND. Amounts in the arbitrage rebate fund shall be invested in the same manner as amounts in the other funds and shall be held in trust for rebate to the United States at the times required by Section 148 of the United States Internal Revenue Code and regulations adopted thereunder. Section 6. PAYMENT ON BONDS. The principal and interest on the bonds shall be payable at the office of the Bank of America NT&SA, P. O. Box 37000, San Francisco, California 94137. Principal and interest shall be paid by check, draft or warrant mailed to the registered owner of each bond at the owner's address appearing on 3 All the register maintained by the registrar on the 15th day preceding the date of interest payment or maturity of each bond. Section 7. REREGISTRATION. Any bond may be registered to a new owner by completing the assignment certificate on the reverse of the bond and delivering the bond to the registrar. Upon reregistration, any bond may be replaced by one or more bonds of the same maturity and aggregate amount in denominations of $5000 or any integral multiple thereof. Section 8. COVENANTS. In the event of a default in the payment of any bond or any installment of interest thereon, bondholders shall have the remedies set forth in the Improvement Bond Act of 1915. In addition, the City Council makes the following covenants, which shall constitute a contract with the bondholders: Section 8. 1. FORECLOSURE OF LIENS. If any installment of principal or interest of any assessment levied in Sewer Assessment District No. 11 becomes delinquent, the City Council shall cause an action to be filed in the Superior Court of the County of Santa Clara to foreclose the lien of the delinquent assessment under the authority of Section 8830 and following of the Streets and Highways Code of the State of California. This action shall be filed not later than one hundred fifty (150) days after the date of delinquency. Section 8.2 . ARBITRAGE. During the term of the bonds, the Town will make no use of bond proceeds which, if such use had been reasonably expected at the date the bonds are, issued, could have caused the bonds to be "arbitrage bonds" within the meaning of Section 148 of the United States Internal Revenue Code of 1986, and regulations of the Internal Revenue Service adopted thereunder, and further shall rebate to the United States any amounts actually earned as arbitrage in accordance with the provisions of that Code and those regulations. Section 8.3 . MAINTENANCE OF TAX EXEMPTION. The Town will take all reasonable actions required to maintain the status of interest on the bonds as excludable from gross income for federal income tax purposes and as exempt from the State of California personal income taxes. Regularly passed and adopted this 21st day of September, 1988. ATTEST: 4 City Clerk ! • MATURITY SCHEDULE Sewer Assessment District No. 11 , Town of Los Altos Hills SEPT 2 MATURITY PRINCIPAL INTEREST DATE AMOUNT RATE 1990 $3,438.28 6.20% 1991 20, 000.00 6.40 1992 20,000.00 6.60 1993 25,000.00 6.80 1994 25 000.00 7.00 1995 25, 000.00 7. 10 1996 25, 000.00 7. 20 1997 30,000.00 7.30 1998 30,000.00 7.40 1999 35 ,000.00 7. 50 2000 35,000.00 7.60 2001 40,000.00 7.70 2002 40, 000.00 7.75 2003 45,000.00 7.80 2004 50,000.00 7.80 TOTAL: $448,438.28 EXHIBITA