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HomeMy WebLinkAboutResolution No. 4719 RESOLUTION NO. 4719 A RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF NOT TO EXCEED TWELVE MILLION DOLLARS ($12,000,000) AGGREGATE PRINCIPAL AMOUNT OF FEDERALLY TAXABLE REVENUE BONDS FOR THE PURPOSE OF FINANCING ENERGY UTILITY SYSTEM CONSERV A TION LOANS AND GRANTS; AUTHORIZING THE ISSUANCE AND SALE OF NOT TO EXCEED THREE MILLION FIVE HUNDRED THOUSAND DOLLARS ($3,500,000) AGGREGATE PRINCIPAL AMOUNT OF TAX-EXEMPT REFUNDING REVENUE BONDS FOR THE PURPOSE OF REFUNDING CERTAIN 2002 MATURITIES; DECLARING OFFICIAL INTENT TO REIMBURSE PRELIMINARY EXPENDITURES INCURRED FOR COSTS OF CERTAIN CAPITAL IMPROVEMENTS WITH THE PROCEEDS OF PRIOR AUTHORIZED TAX-EXEMPT REVENUE BONDS AND PROVIDING FOR RELATED MA TTERS. The City Council of the City of Eugene finds that: A. On February 17, 1993, the City Council adopted Resolution No. 4360 (the "Authorizing Resolution"), to authorize the City, acting through the Eugene Water & Electric Board ("EWEB"), to borrow money and issue, from time to time, revenue bonds (the "Bonds") in an aggregate principal amount of $150,000,000, for the purpose of financing certain improvements to the City's electric utility system, and setting forth certain other terms and conditions for issuance, including the requirement for approval by the City's electors and the requirement that the terms of the bonds should be prescribed by further resolution of the City Council. B. On May 18, 1993, the City's electors approved the issuance of the Bonds (the Authorizing Resolution and the elector approval are referred to herein as the "Bond Authorization"). C. As of the date of this resolution, the aggregate principal amount of Bonds issued pursuant to the 1993 Election is $92,645,000, consisting of $27,000,000 principal amount of Electric Revenue Bonds, Series 1994 issued under City Council Resolution No. 4394, $31,500,000 principal amount Electric Revenue Bonds, Series 1994C issued under City Council Resolution No. 4405, $19,890,000 principal amount of Electric Revenue Bonds, Series 1996 issued under City Council Resolution No. 4425, $12,455,000 principal amount of Electric Revenue Bonds, Series 1998A issued under City Council Resolution No. 4571 and $1,800,000 under a Revolving Line of Credit issued under City Council Resolution No. 5616; D. As of the date of this resolution, there is $57,355,000 of authorized but unissued debt remaining under the Bond Authorization. E. EWEB has requested the City Council to adopt this resolution to set the terms for the issuance of not to exceed $12,000,000 principal amount of Bonds (the "Series 2002B Bonds") for the purpose of making energy conservation loans and grants to electric utility 1 system customers, to fund necessary reserves for the bonds and to pay the costs of issuance of the bonds. F. The proposed purpose of the Series 2002B Bonds are within the purposes described in the Bond Authorization. G. 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 the City, acting by and through EWEB, owns and operates the Electric Utility System. H. The City, including EWEB, anticipates that the interest paid on the Series 2002B Bonds will be federally taxable to the recipients thereof. I. Pursuant to an election of the City electors on March 26, 1991, City Ordinance No. 19741 adopted by the City Council on January 9, 1991 and City Ordinance No. 19780 adopted by the City Council on June 10, 1991, EWEB is authorized to issue, on behalf of the City, certain revenue bonds (hereafter called the "Series 2002C New Project Bonds") for the purpose of financing certain capital improvements to the City's electric utility system, such issuance to be without further authorization or approval by the City Council. J. The City, acting by and through EWEB, has previously issued the City of Eugene, Oregon, Electric System Revenue Bonds, Series 1994 (the "Series 1994 Bonds") the City of Eugene, Oregon, Electric System Revenue Bonds, Series 1996 (the "Series 1996 Bonds") the City of Eugene, Oregon, Electric System Revenue Refunding Bonds, Series 1997 (the "Series 1997 Bonds"); K. The Series 1994 Bonds, the Series 1996 Bonds and the Series 1997 Bonds each have individual maturities coming due as to principal and interest on August 1, 2002 (the "2002 Maturities") and better cash flow management may be achieved by issuing refunding bonds for the purpose of currently refunding the 2002 Maturities (the "Series 2002C Refunding Bonds" and together with the 2002C New Project Bonds, the "2002C Bonds"); L. Issuance of the Series 1997 Bonds was authorized by City Ordinance No. 19780 adopted by the City Council on June 10, 1991 and such ordinance further authorized the refunding of bonds issued under it, therefore, the issuance of bonds refunding the 2002 maturity of the 1997 Bonds may be issued without further authorization or approval by the City Council; M. EWEB has requested the City Council to adopt this resolution to set the terms for the issuance of not to exceed $3,500,000 principal amount of Series 2002C Refunding Bonds for the purpose of currently refunding the 2002 maturity of the Series 1994 Bonds and the 2002 maturity of the Series 1996 Bonds; 2 N. ORS ~288.592 authorizes the issuance of current refunding bonds such as the Series 2002C Refunding Bonds; and O. The City, including EWEB, anticipates incurring expenditures to finance the costs of the project for the Series 2002C New Project Bonds and desires to declare its official intent to reimburse itself for such expenditures from the proceeds of the Series 2002C New Project Bonds. To the extent that the expenditures and the use of proceeds of Series 2002C New Project Bonds may qualify under federal tax law and regulations, the City, including EWEB, intends for the interest on the Series 2002C New Project Bonds to be excludable from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the "Code"), 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. Series 2002B Bonds: Terms~ Purpose of Issue~ Delegation of Authority~ Provisions for Issuance~ Conditions of Issuance. Based on the above findings, the Council hereby authorizes EWEB to issue the Series 2002B Bonds as federally taxable bonds within the following terms and conditions prescribed by the City Council: (a) The Series 2002B Bonds shall: (i) mature not later than fifteen (15) years from the date of issuance thereof; (ii) be sold at par or with a net original issue discount/premium that does not exceed five percent (5%) of the aggregate principal amount thereof; (iii) have an effective interest rate of not to exceed nine percent (9%) per annum; and (iv) not exceed $12,000,000 in total principal; (b) The proceeds of the Series 2002B Bonds shall be used for the purpose making energy conservation loans and grants to electric utility system customers, to fund necessary reserves for the bonds, to pay capitalized interest on the bonds and to pay the costs of issuance of the bonds; (c) Pursuant to ORS ~288.825(4)(a) ORS ~288.520(4) ORS ~288.540 and ORS ~288.545, EWEB, or any individual designated by EWEB, is hereby authorized and directed to determine, with respect to the Series 2002B Bonds, the form of bonds and series designation, the manner of disbursement of proceeds of the bonds, the maturity dates, principal amounts, redemption provisions, interest rates or the method for determining a variable or adjustable interest rate, denominations, form and authorized signatory and other terms and conditions of the bonds because the same cannot be determined by the Council at this time; (d) The Series 2002B Bonds shall include a statement on their face to the effect: (i) 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 3 revenues or property of the City, or property of EWEB, but are charges upon and are payable solely from the revenues of the Electric Utility System operated by EWEB, or any portion thereof, pledged to the payment thereof; and (ii) that the holders thereof may look for repayment only to the revenues of the Electric Utility System which are pledged to 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; and (e) Prior to the issuance of the Series 2002B Bonds, EWEB shall (i) prepare a plan showing that the estimated Electric 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 2. Series 2002C Refunding Bonds: Terms~ Purpose of Issue~ Delegation of Authority~ Provisions for Issuance~ Conditions of Issuance. Based on the above findings, the Council hereby authorizes EWEB to issue the Series 2002C Refunding Bonds, except the bonds to refund the 2002 maturity of the Series 1997 Bonds which have been previously authorized by the City Council in City Ordinance No. 19780, as federally tax-exempt bonds within the following terms and conditions prescribed by the City Council: (a) The Series 2002C Refunding Bonds, except the bonds to refund the 2002 maturity of the Series 1997 Bonds the terms and conditions of which have been previously authorized by the City Council in City Ordinance No. 19780, shall: (i) mature not later than thirty (30) years from the date of issuance thereof; (ii) be sold at par or with a net original issue discount/premium that does not exceed four percent (4%) of the aggregate principal amount thereof; (iii) have an effective interest rate of not to exceed thirteen percent (13%) per annum; and (iv) not exceed $3,500,000 in total principal; (b) The proceeds of the Series 2002C Refunding Bonds shall be used for the purpose of currently refunding the 2002 Maturities; (c) Pursuant to ORS ~288.825(4)(a) ORS ~288.520(4) ORS ~288.540 and ORS ~288.545, EWEB, or any individual designated by EWEB, is hereby authorized and directed to determine, with respect to the Series 2002C Refunding Bonds, except the bonds to refund the 2002 maturity of the Series 1997 Bonds, the terms and conditions of which have been previously authorized by the City Council in City Ordinance No. 19780, the form of bonds and series designation, the manner of disbursement of proceeds of the bonds, the maturity dates, principal amounts, redemption provisions, interest rates or the method for determining a variable or adjustable interest rate, denominations, form and 4 authorized signatory and other terms and conditions of the bonds because the same cannot be determined by the Council at this time; (d) The Series 2002C Refunding Bonds shall include a statement on their face to the effect: (i) 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 Electric Utility System operated by EWEB, or any portion thereof, pledged to the payment thereof; and (ii) that the holders thereof may look for repayment only to the revenues of the Electric Utility System which are pledged to 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; and (e) Prior to the issuance of the Series 2002C Refunding Bonds, EWEB shall (i) prepare a plan showing that the estimated Electric 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 3. Provisions for Sale of Series 2002B Bonds and Series 2002C Bonds at Private Negotiated Sale. The Series 2002B Bonds and the Series 2002C Bonds are authorized to be sold individually or together by private negotiated sale based upon written recommendation of EWEB's independent financial advisor, provided that such financial advisor makes a written evaluation of the terms and conditions of the sale, the pricing thereof and any other relevant aspects of the sale pursuant to ORS ~288.845. Section 4. Series 2002B Bonds and Series 2002C Refunding Bonds Payable Solely from Revenues. The Series 2002B Bonds and Series 2002C Refunding Bonds shall not be general obligations of the City, nor a charge upon its tax revenues, but shall be payable solely from the revenues and funds which EWEB pledges to payment thereof pursuant to ORS ~288.825 and in accordance with Sections 1 and 2 hereof. Section 5. Series 2002B Bonds and Series 2002C Bonds Reporting. EWEB shall submit to the City by May 1 of each year the following annual reports commencing after the first sale of Series 2002B Bonds and Series 2002C Bonds or other evidences of indebtedness and each year thereafter until the bonds have been paid and retired: (a) A report on the funds for the bonds describing the funds established, the amounts in each fund, expenditure from each fund, the manner in which the monies in each fund 5 have been invested, the income from such investments and the application of such income; and (b) A report on bond payments describing amounts paid and amounts scheduled to be paid and the source of such payments. If the contents of the reports required by subsections (a) and (b) above are included in the EWEB's yearly audit report, EWEB may comply with this section by transmitting a copy of its yearly audit report to the City. Section 6. Appointment of Professionals. EWEB is authorized to appoint bond counsel, underwriters, financial advisors, a registrar and paying agent, an escrow agent and any other professional assistance that EWEB determines is necessary or convenient to accomplish the issuance and sale of the Series 2002B Bonds and the Series 2002C Bonds. Section 7. Official Statement. EWEB or any party designated by EWEB is authorized to prepare and distribute a preliminary official statement or other disclosure document for the Series 2002B Bonds and the Series 2002C Bonds, to obtain bond insurance or other credit enhancement, if required, and to obtain a rating of the bonds from Moody's Investors Service, Inc., Standard & Poor's and/or Fitch Ratings, ifrequired. Section 8. Series 2002C Bonds: Declaration of Intent to Reimburse. The City hereby declares its official intent to reimburse itself or EWEB, within the limits of the Code, with proceeds from the Series 2002C Bonds for expenditures incurred prior to the issuance of the Series 2002C Bonds. Section 9. adoption. Effective Date. This Resolution shall become effective immediately upon its The foregoing Resolution adopted by the City Council this 13th day of May, 2002. ,!f;&4--f k. ~ City Recorder 6