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HomeMy WebLinkAboutResolution No. 4686 RESOLUTION NO. 4686 A RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE BY THE CITY OF EUGENE, OREGON, ACTING BY AND THROUGH THE EUGENE WATER & ELECTRIC BOARD, OF REVENUE BONDS IN AN AMOUNT NOT TO EXCEED $60,000,000 TO PROVIDE FUNDS FOR ELECTRIC POWER SUPPLY COST CONTINGENCIES, DECLARING OFFICIAL INTENT TO REIMBURSE EXPENDITURES, PROVIDING FOR PUBLICATION OF NOTICE, AND RELATED MA TTERS The City Council (the "Council ") of the City of Eugene, a municipal corporation of the State of Oregon (the "City"), finds: A. That it is in the best interest of the City, acting by and through the Eugene Water & Electric Board ("EWEB "), to provide for such stand-by funding as may be required to enable EWEB to meet future increases in the cost of purchased electric power which may not be fully covered by available reserves or under the rate structure in effect at the time such cost increases are incurred (collectively, "Power Supply Cost Contingencies"); B. (1) ORS 288.805 to 288.945, commonly known as the Uniform Revenue Bond Act, authorizes the City to issue bonds payable solely from revenues generated by facilities, projects, utilities or systems owned or operated by the City; and (2) the City, acting by and through EWEB, owns and operates an electric utility and related facilities and systems; C. The Power Supply Cost Contingencies (as estimated by EWEB and its consultants, using historical data and five-year forecast conditions related to power and fuel capacity and supplies, transmission capacity, demand and other factors), including issuance costs and debt service reserves, is estimated not to exceed $60,000,000; D. The City estimates that bonds will be issued from time to time in one or more series in an aggregate principal amount not to exceed $60,000,000. 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 Electric Utility System which EWEB pledges to the payment of the bonds; E. EWEB shall cause to be prepared a plan showing that EWEB's estimated Electric Utility System revenues are sufficient to pay the estimated debt service under the revenue bonds; and F. The City and EWEB anticipate incurring expenditures ("Expenditures") for Power Supply Cost Contingencies and wish to declare their official intent to reimburse themselves for the Expenditures from the proceeds of the revenue bonds. To the extent that the Expenditures and the use of proceeds of revenue bonds for Power Supply Cost Contingencies may qualify under federal tax law and regulations, the City and EWEB anticipate that the interest on the revenue bonds will be excludable from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EUGENE, a Municipal Corporation of the State of Oregon, as follows: SECTION 1: REVENUE BONDS AUTHORIZED 1. The Council hereby authorizes EWEB to issue the City's revenue bonds payable from EWEB's revenues in one or more series in an aggregate principal amount not to exceed $60,000,000, for the purpose of providing funds for Power Supply Cost Contingencies, and to fund any required reserves and costs of issuance, and to sell such bonds from time to time in such manner and by such method as shall be specified pursuant to subsequent resolutions of the Council which shall be adopted as a precondition to each such sale. Prior to selling each series of bonds, and in addition to seeking the prior approval of the Council of the manner and method of each such sale, EWEB shall cause to be prepared a plan showing that EWEB's estimated Electric Utility System revenues are sufficient to pay the estimated debt service under such series of bonds and shall adopt an authorizing resolution and provide to the City Manager a copy of such resolution. Pursuant to ORS 288.825(4)(a) and ORS 288.520(4), EWEB or any individual designated by EWEB may determine the maturity dates, principal amounts, redemption provisions, interest rates or the method for determining a variable or adjustable interest rate, denominations and other terms and conditions of the bonds because the same cannot be determined by the Council at this time; provided, however, without the approval of the Council, the effective rate of interest on each series of bonds shall not exceed 9 percent per annum, each series of bonds shall mature not later than seven years from the date of issuance of such series of bonds, and the discount or premium on the bonds may not exceed 5 percent of the aggregate principal amount thereof. 2. Upon completion of the actions stated in Section 2 below pursuant to ORS 288.815, EWEB or any individual designated by EWEB is authorized to prepare and distribute a preliminary official statement or other disclosure document for the bonds; to obtain bond insurance or other credit enhancement, if required; to obtain a rating of the bonds from Moody's Investors Service, Inc., Standard & Poor's Credit Markets Services and/or Pitch IBCA, Duff & Phelps, Inc., if required; to select a Trustee, Registrar or Paying Agent for the bonds; and to determine any other terms, conditions or covenants regarding the bonds, or the Power Supply Cost Contingencies which are necessary or desirable to effect the sale of the bonds. SECTION 2: NOTICE: PROCEDURE 1. No portion of the $60,000,000 authorization may be sold, and no purchase agreement for such portion be executed, for at least 60 days following publication of the Notice of Revenue Bond Authorization, 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 petitions may be submitted, and the City, acting by and through EWEB, shall cause the Notice to be published in The Register-Guard, Eugene, Oregon, a newspaper of general circulation within the boundaries of the City, in the same manner as are other public notices of the City. 2. If petitions for an election, containing the valid signatures of not less than 5 percent of the City's qualified electors, are received within the time indicated in the Notice, the question of issuing such bonds in an amount not to exceed $60,000,000 shall be placed on the ballot at the next legally available election date. If such petitions are received, no such amount of bonds may be sold until the question of whether to issue such bonds is approved by a majority of electors living within the boundaries of the City who vote on that question. Any such petitions will be subject to ORS 288.815 and Sections 2.970-2.992 of The Eugene Code, 1971. SECTION 3: DECLARING INTENT TO REIMBURSE The City reasonably anticipates that the City and EWEB may incur preliminary, cost of issuance and other expenditures that qualify as "Original Expenditures" under Treasury Regulation ~ 1.150-2 prior to the date of issuance of the bonds, and hereby declares its official intent to reimburse itself or EWEB with bond proceeds. SECTION 4: 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 Electric Utility System revenues which EWEB pledges to payment of the bonds pursuant to ORS 288.825(1) and the authorizing resolutions to be adopted by EWEB pursuant to Section 1 of this resolution. The foregoing Resolution adopted on the 6th day of August, 2001. ffdll.1i.U . ~ City Recorder EXHIBIT "A" NOTICE OF REVENUE BOND AUTHORIZATION NOTICE IS HEREBY GIVEN that the Council of the City of Eugene, Oregon (the "City"), adopted Resolution No. 4686 on August 6,2001, authorizing the issuance of the City's revenue bonds acting by and through the Eugene Water & Electric Board ("EWEB"). The bonds will be issued in one or more series to provide funds for contingencies in the cost of purchased electricity for the Electric Utility System operated by EWEB, based on five-year forecasts of supply, demand and operating costs ("Power Purchase Cost Contingencies") and to fund any necessary reserves and costs of issuance. Subject to certain parameters, EWEB may establish all terms, conditions and covenants regarding the bonds and the revenues which are necessary or desirable to effect the sale of the bonds. The City estimates that the bonds will be issued in an aggregate principal amount not to exceed $60,000,000 as and when Power Purchase Cost Contingencies warrant. Principal and interest are expected to be paid from EWEB's Electric Utility System revenues. The bonds will not be general obligations of the City, nor a charge upon its tax revenues, but will be payable solely from the revenues which EWEB pledges to the payment of the bonds. If written petitions, signed by not less than 5 percent of the City's qualified electors, are filed at the Office of the City Recorder on or before October 8, 2001 (the first day on which such Office shall be open for business following the 60th day after the date of publication of this notice), the question of issuing $60,000,000 of the revenue bonds shall be placed on the ballot at the next legally available election date. Any such petition shall be subject to ORS 288.815 and Sections 2.970-2.992 of The Eugene Code, 1971. The Office of the City Recorder is located at 777 Pearl Street, Room 105, 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 authorizing the bonds is available for inspection at the Office of the City Recorder. The bonds will be issued and sold under the Uniform Revenue Bonds Act (ORS 288.805 to 288.945); this notice is published pursuant to ORS 288.815(6). BY ORDER OF THE COUNCIL: August 6,2001 KATHLEEN FIELAND CITY RECORDER