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HomeMy WebLinkAboutResolution No. 5139 COUNCIL RESOLUTION NO.5139 A RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF WATER UTILITY SYSTEM REVENUE BONDS FOR THE PURPOSE OF FINANCING IMPROVEMENTS TO THE WATER UTILITY SYSTEM IN THE AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $18,000,000 AND THE ISSUANCE AND SALE OF WATER UTILITY REVENUE REFUNDING BONDS IN THE AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $35,000,000 TO REFUND ALL OR A PORTION OF THE SERIES 2002 BONDS, SERIES 2005 BONDS AND SERIES 2008 BONDS; AND PROVIDING FOR RELATED MATTERS PASSED: 7:0 REJECTED: OPPOSED: ABSENT: Evans CONSIDERED:October 12, 2015 RESOLUTION NO. 5139 A RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF WATERUTILITY SYSTEM REVENUE BONDSFOR THE PURPOSE OF FINANCING IMPROVEMENTS TO THE WATER UTILITYSYSTEM IN THE AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $18,000,000 AND THE ISSUANCE AND SALE OF WATER UTILITY REVENUE REFUNDING BONDS IN THE AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED$35,000,000 TO REFUNDALL OR A PORTION OF THE SERIES 2002 BONDS, SERIES 2005 BONDS ANDSERIES 2008 BONDS; AND PROVIDING FOR RELATED MATTERS The City Council of the City of Eugene finds that: A. Oregon Revised Statutes (“ORS”) Section287A.150,authorizes the City of Eugene (the “City”) to issue revenue bondspayable from identified revenues of the City.The City, acting by and through the Eugene Water & Electric Board (“EWEB”), owns and operates a water utility system andrelated facilities and systems. B. On September 2, 1997, EWEB adopted a resolution authorizing and providing for the issuance, from time to time, of City of Eugene, Oregon WaterUtility System Revenue Bonds to be equally and ratably secured by the pledge of revenues, funds and accounts thereunder (as amended and supplemented, the “Bond Resolution”). C. The Bond Resolution provides in part that the principal of, premium, if any, and interest on the bonds issued thereunder shall not be payable from any funds of the City nor constitute a general obligation of the City or create a charge upon the tax revenues or any other property or revenues of the City. D. EWEB has requested by resolution that the City Council adopt this Resolution in part to set the terms for the issuance of not to exceed $18,000,000in aggregate principal amount of waterutility system revenue bonds (the “New Money Bonds”) for the purpose of financing the acquisition, design, construction, installation and equipping of certain capital improvementsto the water utility purification, storage, transmission and distribution systems (collectively, the “New Money Project”), to fund necessaryreserves and capitalized interest,and to pay the costs of issuance of Bonds. E. The City, acting by and though EWEB, previously issued its Water Utility System Revenue Bonds, Series 2002 in original principal amount of $10,000,000 (the “Series 2002 Bonds”); F. The outstanding Series 2002 Bonds maturing on and after August 1, 2013,are subject to redemption at the option of EWEB on and after August 1, 2012; G. TheCity, acting by and though EWEB, previously issued its Water Utility System Revenue Bonds, Series 2005 in original principal amount of $12,540,000 (the “Series 2005 Bonds”); Resolution -Page 1of 6 H. The outstanding Series 2005 Bonds maturing on and after August 1, 2016,are subject to redemption at the option of EWEB on and after August 1, 2015; I. The City, acting by and though EWEB, previously issued its Water Utility System Revenue Bonds, Series 2008 in original principal amount of $15,595,000 (the “Series 2008 Bonds”); J. The outstanding Series 2008 Bonds maturing on and after August 1, 2019,are subject to redemption at the option of EWEB on and after August 1, 2018; K. EWEB has determinedthat present value savings may be achieved by issuing refunding bonds for the purpose of refunding all or a portion of (i) the outstanding Series 2002 Bonds which may be called and redeemed on any date on or after August 1, 2012, without premium, (ii) theoutstanding Series 2005 Bonds which may be called and redeemed on any date on or after August 1, 2015,without premium,and (iii) the outstanding Series 2008Bonds which may be called on any date on and after August 1, 2018, without premium (collectively the “Refunded Bonds”). L. EWEB has requested by resolution that the City Council adopt this Resolution in part to set the terms for and authorize the issuance of not to exceed $35,000,000 water utility system revenue refunding bonds (the “Refunding Bonds”) for the purpose of refunding the Refunded Bonds, to fund necessary reserves and to pay costs of issuance of the Refunding Bonds(collectively, the “Refunding Project” which, together with the New Money Project is referred to as the “Project”). The New Money Bonds collectively with the Refunding Bonds are referred to as the “Bonds”. M. The Bonds will not be general obligations of the City, nor a charge upon its tax revenues, but will be payable solely from revenues of the WaterUtility System which EWEB pledges to the payment of such Bonds pursuant to ORS Sections 287A.310 and 287A.325 and the resolution to be adopted by EWEB pursuant to this Resolution. N. EWEB has by resolution undertaken to cause to be prepared a plan showing that EWEB’s estimated WaterUtility System revenues are sufficient to pay the estimated debt service on the Bonds authorized by this Resolution. O. The City and EWEB anticipate incurring expenditures (“Expenditures”) to finance the costs of the New Money Project and wish to declare their officialintent to reimburse themselves for the Expenditures made on theNew Money Project from the proceeds of the New Money Bonds. To the extent that the Expenditures and the use of proceeds of the New Money Bonds may qualify under federal tax law and regulations, the City, including EWEB, intends for the interest on such bonds to be excludable from gross income for federal income tax purposes under §103 of the Internal Revenue Code of 1986, as amended. P. EWEB hasrequested by resolution that the City Council adopt this Resolution in part to authorize the publication of the Notice of Revenue Bond Authorization relating to the New Money Bonds, such notice being in substantially the form attached to this Resolution as Exhibit“A” (the “Notice”). The Notice shall specify the last date on which Resolution -Page 2of 6 petitions may be submitted, and the City, acting by and through EWEB, shall cause the Notice to be published in The Register-Guard,a newspaper of general circulation within the boundaries of the City, in the same manner as are other public notices of the City. NOW THEREFORE, based upon the above findings, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EUGENE, a Municipal Corporation of the State of Oregon, as follows: Section 1. Authorization of New Money Bonds and Publication of Notice; Purpose of Issue. Based on the above findings, subject to the prior publication of the Notice and the expiration of the 60-day period following the publication of the Notice without the receipt of a petition for an election questioning the issuance of the New Money Bonds, which facts and circumstances shall be determined conclusively and for all purposes by any individual designated by EWEB, the City Council hereby authorizes EWEB, on behalf of the City, to issue and sell the New Money Bonds designated as the “City of Eugene, Oregon WaterUtility System Revenue Bonds,” or such other name approved by the individual designated by EWEB, in one or more series, in the aggregate principal amount of not to exceed $18,000,000, for the purpose of financing the NewMoney Project, and to fund any required reserves and costs of issuance, and to publish the Notice as aforesaid. If petitions for an election, containing the valid signatures of not less than 5 percent of the City’s qualified electors, are received withinthe time indicated in the Notice, the question of issuing the New Money Bonds shall be placed on the ballot at the next legally available election date. If such petitions are received,noNew Money Bonds may be sold until the question of whether to issuethe New Money Bonds is approved by a majority of the City’s qualified electorswho vote on that question. Any such petitions will be subject to ORS 287A.150and Sections 2.960-2.1005of the Eugene Code, 1971.Capitalized terms used but not defined herein shall have the meaning assigned in the Bond Resolution, unless the context clearly requires otherwise. Section 2. Authorization of Refunding Bonds; Purpose of Issue.Based on the above findings, the City Council hereby authorizes EWEB, on behalf of the City, to issue and sell the Refunding Bonds designated as the “City of Eugene, Oregon Water Utility System Revenue Refunding Bonds,”or such other name approved by the individual designated by EWEB,in one or more series, in an amount not to exceed $35,000,000 for the purpose of refunding all or a portion of the Series 2002 Bonds, the Series 2005 Bonds and the Series 2008Bonds, and to fund any required reserves and costs of issuance of the Refunding Bonds. Section 3. Conditions of Issuance and Sale. The City Council herebyprescribes that: (a)The Bonds of each series shall: (i)mature not later than thirty (30) years from the date of issuance of the series; (ii)be sold either through apublic competitive sale and awarded to the bidder offering the most favorable terms to EWEB, on behalf of the City, or sold pursuant to negotiation at par or with a net original issue discount or premium that does not Resolution -Page 3of 6 exceed eighteen percent (18.0%) of the aggregate principal amount thereof; and (iii)have an effective interest rate of not to exceed seven percent (7.0%) per annum; and (b)The proceeds of the Bonds shall be used only for the purposes above described. Section 4. Delegation of Authority for Terms of Bonds; Provisions for Issuance. Pursuant to ORS 287A.300(4), EWEB, or any individual designated by EWEB, is hereby authorized and directed to determine, with respect to the Bonds, the form of bond and series designation, the manner of disbursement of proceeds of the Bonds, the maturity dates, principal amounts, redemption provisions, interest rates orthe method for determining a variable or adjustable interest rate, whether a taxable or tax-exempt bond, obtain bond insurance or some other form of guaranty or security for the payment of the Bonds, denominations, form, authorized signatory, and other necessary or desirable documents,and other terms and conditions of the Bonds because the same cannot be determined by the City Council at this time. Prior to the issuance of any Bonds, EWEB shall: (i)prepare a plan showing that the estimated Water Utility System revenues are sufficient to pay the estimated debt service on the Bonds; (ii)adopt a bond resolution and provide a copy of such resolution to the City; and (iii)provide to the City a resolution determining that any and all acts, conditions and things required to exist, to happen and to be performed precedent to and in the issuance of the Bonds, exist, have happened and have been performed in due time, form and manner as required by the Constitution and statutes of the State of Oregon, the Charter of the City of Eugene and this Resolution. Section 5. Declaring Intent to Reimburse. The City reasonably anticipates that the City and EWEB may incur preliminary, cost of issuance and other project expenditures that qualify as “Original Expenditures” under TreasuryRegulation §1.150-2 prior to the date of issuance of the Bonds, and hereby declares its official intent to reimburse itself or EWEB with proceeds of the sale of the New Money Bonds to be issued in an amount not to exceed $18,000,000in aggregate principalamount. Section 6. Statement on Form of Bond. All Bonds shall include a statement on their face to the effect: (a)That they do not in any manner constitute a general obligation of EWEB or of the City, or create a charge upon the tax revenues of the City, or upon any other revenues or property of the City, or property of EWEB, but are charges upon and are payable solely from the revenues of the WaterUtility System operated by EWEB, or any portion thereof, pledged to the payment thereof; and (b)That the holders thereof maylook for repayment only to the revenues of the WaterUtility System which are pledged for the payment thereof, and may not directly or indirectly be paid or compensated through the property of the City, or EWEB, or by or through the taxing power of the City. Section 7. Bonds Payable Solely from Revenues. The Bonds shall not be general obligations of the City, nor a charge upon its tax revenues, but shall be payable solely from the Resolution -Page 4of 6 EXHIBIT A FORM OF NOTICE OF REVENUE BOND AUTHORIZATION NOTICE IS HEREBY GIVEN that the City Council of the City of Eugene, Oregon (the “City”) has adopted Resolution No. 5139onOctober 12, 2015, authorizing the issuance of the City’s revenue bonds acting by and through the Eugene Water & Electric Board (“EWEB”). The revenue bonds will be issued in one or more series to provide funds for the purpose of financing the acquisition, design, construction, installation and equipping of certain capital improvements to the water utility purification, storage, transmission and distribution systems (collectively, the “Project”), to fund necessaryreserves and to pay the costs of issuance of the revenue bonds. The costs of the Project to be funded, together with bond issuance costs and debt service reserves, are estimated not to exceed $18,000,000. In accordance with these estimates, the City expects that the revenue bonds will be issued in an aggregate principal amount not to exceed $18,000,000. Subject to certain parameters, EWEB may establish all terms, conditions and covenants regarding the revenue bondsand the revenues which are necessary or desirable to affect the sale of the revenue bonds. The revenue bonds will not be general obligations of the City, nor a charge upon its tax revenues, but will be payable solely from the revenues of the City’s Water Utility System. If written petitions, signed by not less than 5 percent of the City’s qualified electors, are st filed at the Office of the City Recorder on or before December 14, 2015(the 61day after the date of publication of this notice), the question of issuing $18,000,000of water revenue bonds shall be placed on the ballot at the next legally available election date. Any such petition shall be subject to ORS 287A.150 and Sections 2.960-2.1005of The Eugene Code, 1971. th The Office of theCity Recorder is located at 125 East 8Avenue,Eugene, Oregon 97401. Information on procedures for filing petitions may also be obtained at such address or by telephone at (541) 682-5042. The resolution authorizingtherevenue bonds is available for inspection at the Office of the City Recorder. The revenue bonds will be issuedand sold pursuant to ORS 287A.150, and this notice is published pursuant to ORS 287A.150(4). A-1