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HomeMy WebLinkAboutResolution 3250 Bond Sale - SID 664; 07-06-98 --. -. -------~ ._u__...._._ COMMISSION RESOLUTION NO. 3250 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, RELATING TO $150,000 SPECIAL IMPROVEMENT DISTRICT NO. 664 BONDS; AUTHORIZING THE ISSUANCE AND CALLING FOR THE PUBLIC SALE THEREOF AND AUTHORIZING THE PLEDGE OF THE REVOLVING FUND TO THE SECURITY THEREOF. BE IT RESOLVED by the City Commission of the City of Bozeman, Montana (the "City"), as follows: Section 1. Recitals. (a) This Commission has duly and validly created and established in the City under Montana Code Annotated, Title 7, Chapter 12, Parts 41 and 42, as amended (the" Act"), a special improvement district, designated as Special Improvement District No. 664 (the "District"), for the purpose of financing a portion of costs of certain public improvements of special benefit to the properties within the District (the "Improvements") and paying costs incidental thereto, including costs associated with the sale and the security of special improvement district bonds of the City drawn on the District (the "Bonds"), the creation and administration of the District and the funding of a deposit to the City's Special Improvement District Revolving Fund (the "Revolving Fund"). The total estimated costs of the Improvements, including such incidental costs, to be financed by the District are $150,000. The costs of the Improvements are to be paid from the proceeds of the Bonds, which are to be payable primarily from special assessments to be levied against property in the District, which property will be specially benefitted by the Improvements in an amount not less than $150,000. (b) The City is authorized by Montana Code Annotated, Section 7-12-4204( 1) to sell the Bonds at a price less than the principal amount thereof, but including interest thereon to the date of delivery, if this Commission determines that such sale is in the best interests of the District and the City. (c) It is necessary that the Bonds be issued and sold in an aggregate principal amount of $150,000 to finance the costs of the Improvements, including incidental costs, described in Subsection (a). The costs of the Improvements are currently estimated, as follows: Engineering $ 15,200 Construction 120,070 Contingency 1 2,007 Administration 4,356 Resolution and Advertisements 400 Revolving Fund Deposit 7,500 Costs of Issuance 2,000 Bond Discount 5.000 Total $166,533 Costs in excess of bond proceeds will be paid from City funds available therefor. Section 2. Determination of Public Interest in Allowing Bond Discount. Pursuant to the authority described in Section 1, this Commission hereby determines to fix the minimum price for the Bonds at $145,000, plus interest accrued thereon to the date of delivery. Such minimum bid will enable bidders to bid more efficiently for the Bonds by permitting them to submit their bids based on actual market conditions without adjusting the interest rates thereon to provide compensation for their purchase of the Bonds. This procedure will facilitate the sale of the Bonds at the lowest interest rates, which is in the best interests of the District and the City. Section 3. Findinqs and Determination to Pledge the Revolvinq Fund. In the Resolution of Intention To Create the District, adopted on October 6, 1997, this Commission found it to be in the public interest, and in the best interest of the City and the District, to secure payment of principal of and interest on the Bonds by the Revolving Fund and authorized the City to enter into the undertakings and agreements authorized in the Act in respect of the Bonds, based on the factors required to be considered under Section 7-12-4225(4) of the Act. Those findings and determinations were ratified and confirmed in the resolution adopted by this Commission on June 15, 1998, creating the District, and are hereby ratified and confirmed. It is hereby covenanted and recited that the City has the power under the Act to pledge the Revolving Fund to payment of the principal of and interest on the Bonds. Section 4. Terms of the Bonds. This Commission hereby authorizes the issuance and sale of the Bonds, to be denominated "Special Improvement District No. 664 Bonds," of the City in the aggregate principal amount of $150,000 (the "Bonds") for the purpose of financing the Improvements. The Bonds shall be dated, as originally issued, as of August 15, 1998, and shall bear interest payable semiannually on January 1 and July 1 of each year, commencing July 1, 1999, at a rate or rates designated by the successful bidder at public sale and approved by this Commission. If issued as serial bonds, the Bonds shall mature on July 1 in each of the following years and amounts: - 2 - -- --... -.------...-..-. Year Amount Year Amount 2000 $ 5,000 2007 $10,000 2001 5,000 2008 1 0,000 2002 5,000 2009 1 5,000 2003 1 0,000 2010 1 5,000 2004 1 0,000 2011 1 5,000 2005 1 0,000 2012 1 5,000 2006 1 0,000 2013 1 5,000 If issued as amortization bonds, the Bonds will be issued as a single bond or divided into several bonds, as the Commission may determine at the time of the sale, and the principal of and interest on the Bonds shall be payable semiannually in equal payments on each January 1 and July 1, commencing July 1, 1999, and concluding July 1, 2013, unless the Bonds are earlier redeemed. Serial bonds shall be in the denomination of $5,000 each or any integral multiple thereof of single maturities. Amortization bonds are preferred. The Bonds shall be issuable only as fully registered bonds and shall be executed by the manual or facsimile signatures of the Mayor, City Manager and the Clerk of the Commission. The Bonds shall be secured by the Revolving Fund. Section 5. Public Sale. The Bonds shall be sold at a public competitive sale which is hereby called and shall be held at a regular meeting of this Commission on August 3, 1998, at 3:00 p.m. The City will receive sealed bids for the Bonds in accordance with the notice of sale hereinafter prescribed. The Clerk of the Commission is hereby authorized and directed to cause notice of the sale to be published, as required by Montana Code Annotated, Sections 7-12-4204, 7-7-4252 and 17-5-106, in the Bozeman Daily Chronicle, once each week for two successive weeks preceding the week which contains the date of sale. The notice of sale shall be published and mailed in substantially the form set forth as Exhibit A to this resolution (which is hereby incorporated herein and made a part hereof) and this Commission hereby adopts the terms and conditions set forth in such notice of sale as the terms and conditions of the sale of the Bonds. Section 6. Construction Bids. Since construction bids will be opened on July 7, 1998, the Commission hereby authorizes the Administrative Services Director to revise the notice of sale prior to publication to take into consideration lower than anticipated construction bids, if applicable. Section 7. Continuina Disclosure: ExemDtion. Bidders and other participating underwriters in the primary offering of the Bonds need not comply with paragraph (b)(5) of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities - 3 - ---.. --... -. ----.---.---.-. ----.-.....--.- ...- Exchange Act of 1934 (the URule"), because the aggregate principal amount of the Bonds and any other securities required to be integrated with the Bonds is less than $1,000,000. Consequently, the City will not enter into any undertaking to provide continuing disclosure of any kind with respect to the Bonds. Passed and adopted by the City Commission of the City of Bozeman, Montana, this 6th day of July, 1998. ~~ ~ p/ff ALF M. TIFF, Mayo ATTEST: ~;/~ ROBIN L. SULLIVAN Clerk of the Commission APPROVED AS TO FORM: , ~)~# PAULJ E . City ttorney - 4 - - --.....--.-------- .-- ---..--.---.-. EXHIBIT A NOTICE OF BOND SALE $150,000 SPECIAL IMPROVEMENT DISTRICT NO. 664 BONDS CITY OF BOZEMAN, MONTANA NOTICE IS HEREBY GIVEN that the City of Bozeman, Montana (the "City"), will sell to the highest and best bidder for cash, as evidenced by sealed bids, the above-described Bonds drawn against the fund of Special Improvement District No. 664 in the principal amount of $150,000. Sealed bids for the purchase of the Bonds will be received until 10:00 a.m., M.D.T. on August 3, 1998, at the office of the Clerk of the Commission in the City Hall, at 411 East Main Street, Bozeman, Montana, at which time the bids will be opened and tabulated. The City Commission of the City will meet at 3:00 p.m. on the same day in the Commission Room in the City Hall to consider the bids and the award of sale of the Bonds. Purpose and Security The Bonds will be issued for the purpose of financing the cost of construction of certain local improvements (the "Improvements") within or for the benefit of Special Improvement District No. 664 (the "District"). in accordance with the provisions of Montana Code Annotated, Title 7, Chapter 12, Parts 41 and 42, as amended (the "Act"). The Bonds will be special, limited obligations of the City and do not constitute general obligations of the City. The Bonds are payable primarily from the collection of a special tax or assessment which is a len against the assessable real property within the District benefitted by the Improvements to be undertaken therein or therefor. The special assessments are payable in equal, semiannual installments over a 14-year term, with unpaid installments of the special assessments bearing interest at a rate equal, from time to time, to the sum of (i) the average rate of interest borne by the then outstanding Bonds, plus (ii) one-half of one percent (0.50%) per annum. The Bonds are further secured by the Special Improvement District Revolving Fund of the City (the "Revolving Fund"). The City will agree to make a loan from the Revolving Fund to the district fund established for the District to make good any deficiency then existing in the principal and interest accounts therein and to provide funds for the Revolving Fund by levying a tax or making a loan from the City's general fund to the extent and for the period authorized by the Act. Date and Tvpe The Bonds will be dated, as originally issued, as of August 15, 1998, and will be issued as negotiable investment securities in registered form as to both principal and interest. Maturities and Form If issued as serial bonds, the Bonds shall mature, subject to redemption, on July 1 in the following years and amounts: Year Amount Year Amount 2000 $5,000 2007 $10,000 2001 5,000 2008 10,000 2002 5,000 2009 15,000 2003 1 0,000 2010 1 5,000 2004 1 0,000 2011 1 5,000 2005 1 0,000 2012 1 5,000 2006 1 0,000 2013 1 5,000 If issued as amortization bonds, the Bonds will be issued as a single bond or divided into several bonds, as the Commission may determine, and the principal of the Bonds shall be payable semiannually on each January 1 and July 1, commencing July 1, 1999, and continuing through July 1, 2013, subject to prior redemption. Serial bonds shall be in the denomination of $5,000 each or any integral multiple thereof of single maturities. Amortization bonds shall be preferred. Redemption Mandatory Redemption. If on any interest payment date there will be a balance in the District Fund after payment of the principal and interest due on all Bonds drawn against it, either from the prepayment of special assessments levied in the Districts or from the transfer of surplus money from the Construction Account to the Principal Account, outstanding Bonds, or portions thereof, in an amount which, together with the interest thereon to the interest payment date, will equal the amount of such funds on deposit in the District Fund on that date are subject to mandatory redemption on that interest payment date. The redemption price shall equal the amount of the principal amount of the Bonds to be redeemed plus interest accrued to the date of redemption. OPtional Redemption. The Bonds are subject to redemption, in whole or in part, at the option of the City from sources of funds available therefor other than those described under "Mandatory Redemption" on any interest payment date; provided, however, the Bonds A~2 shall not be called for redemption before July 1, 2003, from the proceeds of refunding special improvement district bonds or warrants. The redemption price shall equal the principal amount of the Bonds to be redeemed plus interest accrued to the date of redemption. Selection of Bonds for Redemption. If less than all of the Bonds are to be redeemed, Bonds shall be redeemed in order of the stated maturities thereof. If less than all Bonds of a stated maturity are to be redeemed, the Bonds of such maturity shall be selected for redemption in $5,000 principal amounts selected by the Registrar by lot or other manner it deems fair. Interest Pavment Dates. Rates Interest will be payable each January 1 and July 1, commencing July 1, 1999, to the registered owners of the Bonds as such appear in the bond register as of the close of business on the 15th day (whether or not a business day) of the immediately preceding month. All Bonds of the same stated maturity must bear interest from date of original issue until paid at a single, uniform rate. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of 1 %. No supplemental or "B" coupons or additional interest certificates are permitted. Interest will be calculated on the basis of a 360-day year consisting of twelve 30- day months. Bond Reqistrar. Transfer Aqent and Paving Agent The Administrative Services Director of the City will act as bond registrar, transfer agent and paying agent (the "Registrar"). The bond register will be kept. transfers of ownership will be effected and principal of and interest on the Bonds will be paid by the Registrar. The City will pay the charges of the Registrar for such services. The City reserves the right to appoint a suitable bank or trust company as a successor Registrar. Deliverv Within 45 days after the sale, the City will deliver to the Registrar the printed Bonds ready for completion and authentication. The original purchaser of the Bonds must notify the Registrar, at least five business days before issuance of the Bonds, of the persons in whose names the Bonds will be initially registered and the denominations of the Bonds to be originally issued. If notification is not received by that date, the Bonds will be registered in the name of the original purchaser and, if serial bonds, will be issued in denominations corresponding to the principal maturities of the Bonds. On the day of closing, the City will A-3 ......--.---..-.. .-- - -.--.----.-----.-- .... .---.-..-..- -..- furnish to the purchaser the opinion of Bond Counsel hereinafter described, an arbitrage certification and a certificate stating that no litigation in any manner questioning the validity of the Bonds is then pending or, to the knowledge of officers of the City, threatened. Payment for the Bonds must be received by the City in immediately available funds at its designated depository on the day of closing. The successful bidder shall submit to the Clerk of the Commission not earlier than 48 hours after the award of sale and not later than the day of closing a certificate, in form satisfactory to Bond Counsel, as to the initial reoffering price of each stated maturity of the Bonds and stating that at least ten percent of the principal amount of such Bonds of each stated maturity has been sold at such respective prices. Qualified Tax-Exemot Obliaations The Bonds will be designated by the City as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"), and financial institutions described in Section 265(b)(5) of the Code may treat the Bonds for purposes of Sections 265(b)(2) and 291 (e)(1 )(B) of the Code as if they were acquired on August 7, 1986. Leaal Ooinion An opinion as to the validity of the Bonds and the exclusion of the interest thereon from gross income for federal income tax purposes and Montana individual income tax purposes will be furnished by Dorsey & Whitney LLP, of Missoula, Montana, and Minneapolis, Minnesota, as Bond Counsel. The legal opinion will be delivered at closing. The legal opinion will state that the Bonds are valid and binding special, limited obligations of the City enforceable in accordance with their terms, except to the extent to which enforceability thereof may be limited by the exercise of judicial discretion or by state or federal laws relating to bankruptcy, reorganization, moratorium or creditors' rights. Type of Bid and Good Faith Deposit Sealed bids for not less than $145,000 and accrued interest on the principal sum of $150,000 must be mailed or delivered to the undersigned and must be received at the office of the Clerk of the Commission prior to the time stated above. Bidders must bid for all or none of the Bonds. Each bid must be unconditional. Except for a bid by or on behalf of the Board of Investments of the State of Montana, a good faith deposit (the "Deposit") in the form of money, cashier's check, A-4 _.____.__.n__. _ . ._._.____n ._.___._ n.__._._._ .. _ __.n __._ _ _..._ ._.n .. _ n___.__..__n.___ __.._ certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the federal deposit insurance corporation or a financial surety bond in the sum of $3,000 payable to the order of the City is required for a bid to be considered. If money, cashier's check, certified check, bank money order, or bank draft is used, it must accompany the bid and be delivered to the Clerk of the Commission. If a financial surety bond is used, it must be from an insurance company licensed and qualified to issue such a bond in the State of Montana and such bond must be submitted to the Clerk of the Commission prior to the opening of the bids. The financial surety bond must identify each bidder whose Deposit is guaranteed by such financial surety bond. If the Bonds are awarded to a bidder utilizing a financial surety bond, then that purchaser is required to submit its Deposit to the City in the form of a cashier's check (or wire transfer such amount as instructed by the City) not later than 1 :00 p.m., M.T., on the next business day following the award. If such Deposit is not received by that timet the financial surety bond may be drawn by the City to satisfy the Deposit requirement. No interest on the Deposit will accrue to the purchaser. The Deposit will be applied to the purchase price of the Bonds. In the event the purchaser fails to honor its accepted bid, the Deposit will be retained by the City as liquidated damages. The Deposit of the unsuccessful bidders will be returned immediately on award of the Bonds to the purchaser or after rejection of all bids. Instructions for wiring the Deposit may be obtained from the City's Administrative Services Director, City of Bozeman, P. O. Box 640/ Bozeman, Montana 59771/ (406) 582-2325. Award The bid authorizing the lowest net interest cost (total interest on all Bonds from August 15/ 1998 to their maturities, less any premium or plus any discount), will be deemed the most favorable. In the event that two or more bids state the lowest net interest cost, the sale of the Bonds will be awarded by lot. No oral bid will be considered. The City reserves the rights to reject any and all bids, to waive informalities in any bid and to adjourn the sale. CUSIP Numbers The City will assume no obligation for the assignment or printing of CUSIP numbers on the Bonds or for the correctness of any numbers printed thereon, but will permit such numbers to be assigned and printed at the expense of the purchaser, if the original purchaser waives any delay in delivery occasioned thereby. A-5 Continuinq Disclosure: Exemption Bidders and other participating underwriters in the primary offering of the Bonds need not comply with paragraph (b)(5) of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 (the "Rule"), because the aggregate principal amount of the Bonds and any other securities required to be integrated with the Bonds is less than $1,000,000. Consequently, the City will not enter into any undertaking to provide continuing disclosure of any kind with respect to the Bonds. Information for bidders and bidding forms and instructions for submitting bids by facsimile may be obtained from the undersigned. Dated: July 7, 1998. BY ORDER OF THE CITY COMMISSION Qt j~ Robin L. Sullivan Clerk of the Commission City of Bozeman, Montana Legal Ad Publish: Sunday, July 12, 1998 Sunday, July 19, 1998 A-6 ---- ... - .---- CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE I, the undersigned, being the duly qualified and acting recording officer of the City of Bozeman, Montana (the "City"), hereby certify that the attached resolution is a true copy of a Resolution entitled: "RESOLUTION RELATING TO $150,000 SPECIAL IMPROVEMENT DISTRICT NO. 664 BONDS; AUTHORIZING THE ISSUANCE AND CALLING FOR THE PUBLIC SALE THEREOF AND AUTHORIZING THE PLEDGE OF THE REVOLVING FUND TO THE SECURITY THEREOF" (the "Resolution"), on file in the original records of the City in my legal custody; that the Resolution was duly adopted by the City Commission of the City at a regular meeting on July 6, 1998, and that the meeting was duly held by the City Commission and was attended throughout by a quorum, pursuant to call and notice of such meeting given as required by law; and that the Resolution has not as of the date hereof been amended or repealed. I further certify that, upon vote being taken on the Resolution at said meeting, the following Commissioners voted in favor thereof: Commi 55 i oner Smil ey, Commi 55 i oner Rudberg, Commissioner Frost, Commissioner Youngman and Mayor Stiff , voted against the same: none , abstained from voting thereon: none ; or were absent: none WITNESS my hand and seal officially this 7th day of July, 1998. [SEAL]" (2.. , ~ ;/ J&'~ _ "', -- Clerk of the Commission -~~ ~ _.~ -.--- -.- - - ---- -~ ~ ~- ......... """- .... -.. ~-~-, - ---- - . - " --.--.-.- ....-----..-