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HomeMy WebLinkAboutResolutions - No. 2010-173RESOLUTION NO. 2010-173 A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING DOCUMENTS AND OFFICIAL ACTIONS RELATING TO THE INSTALLMENT SALE FINANCING OF WATER SYSTEM IMPROVEMENTS AND THE ISSUANCE AND SALE OF WATER REVENUE BONDS BY THE LODI PUBLIC FINANCING AUTHORITY WHEREAS, the City of Lodi (the "City") owns and operates facilities and property for the supply, treatment, and distribution of water within the service area of the City (the "Water System"); and WHEREAS, in order to provide funds to finance the acquisition and construction of additional improvements to the Water System (the "Water Projects"), the Authority proposes to issue its 2010 Water Revenue Bonds (the "Bonds") under the provisions of Article 4 of Chapter 5, Division 7, Title 1 of the Government Code of the State of California, commencing with Section 6584 of said Code (the "Bond Law"); and WHEREAS, in order to provide revenues which are sufficient to pay debt service on the Bonds, the Authority proposes to sell the completed Water Projects to the City under an Installment Sale Agreement for a purchase price to be paid by the City in semiannual installments during the term of the Bonds; and WHEREAS, the obligations of the City under the proposed Installment Sale Agreement will be secured by a pledge of and lien on the net revenues of the Water System; and WHEREAS, the City Council wishes at this time to take action approving such financing transactions and all related documents and actions. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lodi as follows: Section 1. Approval of Financing Plan; Authorization of Bonds. The City Council hereby approves the financing plan described in the recitals of this Resolution. To that end, the City Council hereby approves the issuance of the Bonds by the Authority under the Bond Law in the aggregate principal amount of not to exceed $45,000,000. Section 2. Approval of Installment Sale Agreement. The City Council hereby approves the Installment Sale Agreement between the Authority and the City, under which the Authority agrees to sell the completed Water Projects to the City for a purchase price to be paid in semiannual installment payments. As provided in the Installment Sale Agreement, the installment payments thereunder shall be payable from and secured by a pledge of and lien on the net revenues of the Water System. The Installment Sale Agreement is hereby approved in substantially the form on file with the City Clerk together with any changes therein or additions thereto deemed advisable by the City Manager or the Deputy City Manager/Internal Services Director (each, an "Authorized Officer"). An Authorized Officer is hereby authorized and directed for and in the name and on behalf of the City to execute, and the City Clerk is hereby authorized and directed to attest, the final form of the Installment Sale Agreement, and such execution shall be conclusive evidence of the approval of the final form thereof. Section 3. Sale of Bonds; Approval of Bond Purchase Agreement. The City Council hereby approves the negotiated sale of the Bonds by the Authority to Stone & Youngberg LLC (the "Underwriter'). The Bonds shall be sold upon the terms and conditions set forth in the Bond Purchase Agreement in substantially the form on file with the City Clerk together with any changes therein or additions thereto deemed advisable by an Authorized Officer. As provided in the resolution of the Board of Directors of the Authority authorizing the issuance and sale of the Bonds, the true interest cost of the Bonds shall not exceed 6.0% and the maximum amount of Underwriter's discount on the sale of the Bonds shall not exceed 0.85% of the par amount of the Bonds; provided, however, (i) if an Authorized Officer, after consultation with the City's bond counsel and financial advisor and the Underwriter, concludes that it will be economically beneficial to the City for the Authority to issue all or a portion of the Bonds as taxable bonds under the Build America Bonds program created by the American Recovery and Reinvestment Act of 2009, then the Bonds (or a portion of the Bonds, in a second series) may be issued as taxable bonds, and the true interest cost of such taxable bonds shall not exceed 8.5%. The final form of the Bond Purchase Agreement shall be executed in the name and on behalf of the City by an Authorized Officer. Section 4. Official Statement. The City Council hereby approves and deems nearly final within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934, the Preliminary Official Statement describing the Bonds in the form on file with the City Clerk, together with such modifications thereof as may be approved by an Authorized Officer. An Authorized Officer is hereby authorized and directed to (a) execute and deliver to the purchaser of the Bonds a certificate deeming the Preliminary Official Statement to be nearly final as of its date within the meaning of such Rule, (b) approve any changes in or additions to cause the Official Statement to be put in final form, and (c) execute the final Official Statement for and in the name and on behalf of the City. The City Council hereby authorizes the distribution of the Preliminary Official Statement and the Final Official Statement by the Underwriter. Section 5. Official Actions. The Mayor, the City Manager, the Deputy City Manager/Internal Services Director, the City Clerk, the City Attorney and all other officers of the City are each authorized and directed in the name and on behalf of the City to make any and all assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and other documents, which they or any of them might deem necessary or appropriate in order to consummate any of the transactions contemplated by the agreements and documents approved under this Resolution, including any documentation relating to municipal bond insurance if an Authorized Officer concludes, after consultation with the City's bond counsel, the City's financial advisor and the Underwriter, that it would be cost-effective to purchase such insurance. Whenever in this Resolution any officer of the City is authorized to execute or countersign any document or take any action, such execution, countersigning or action may be taken on behalf of such officer by any person designated by such officer to act on his or her behalf in case such officer is absent or unavailable. Section 6. Effective Date. This Resolution shall take effect immediately upon its passage and adoption. -2- Dated: October 6, 2010 hereby certify that Resolution No. 2010-173 was passed and adopted by the City Council of the City of Lodi in a regular meeting held October 6, 2010, by the following vote: AYES: COUNCIL MEMBERS— Hansen, Johnson, and Mayor Katzakian NOES: COUNCIL MEMBERS— Hitchcock and Mounce ABSENT: COUNCIL MEMBERS— None ABSTAIN: COUNCIL MEMBERS— None &OHL City Clerk 2010-173 -3-