HomeMy WebLinkAboutResolution 3026 Sale of bonds for SIDs 660 and 663
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RESOLUTION NO. 3026
RESOLUTION RELATING TO $374,600 POOLED SPECIAL
IMPROVEMENT DISTRICT BONDS, SERIES 1994 (SPECIAL
IMPROVEMENT DISTRICT NOS. 660 AND 663); FIXING THE
FORM AND DETAILS AND PROVIDING FOR THE
EXECUTION AND DELIVERY THEREOF AND SECURITY
THEREFOR
BE IT RESOLVED by the City Commission of the City of Bozeman,
Montana (the "City"), as follows:
Section 1. Recitals. It is hereby found, determined and declared as
follows:
1.01. Resolutions of Intention. By Resolution Nos. 2977 and 2987,
adopted June 6, 1994 and July 11, 1994, respectively (collectively, the "Resolutions of
Intention"), this Commission declared its intention to create Special Improvement
Districts Nos. 660 and 663 (collectively, the "Districts"), for the purpose of making
special improvements for the special benefit of the Districts. Each of the Resolutions
of Intention designated the number of the District, described the boundaries thereof,
stated whether the District was an extended district and stated the general character
of the improvements to be made (collectively, the "Improvements") and an
approximate estimate of the costs thereof, in accordance with the provisions of
Montana Code Annotated, Title 7, Chapter 12, Parts 41 and 42, as amended (the
"Act"). By each Resolution of Intention this Commission also declared its intention
to cause the cost and expense of making the improvements specially benefiting a
District to be assessed against the properties included within the boundaries thereof
in accordance with one or more methods of assessment authorized in Montana
Code Annotated, Sections 7-12-4161 to 7-12-4165 and as set forth in the Resolution of
Intention.
1.02. Notices. Notice of the passage of each of the Resolutions of
Intention was given by five publications in the Bozeman Daily Chronicle, a daily
newspaper published within the City. Notice of the passage of each of the
Resolutions of Intention was also mailed three days prior to the first day the notice
was published to all persons, firms or corporations or the agents thereof having real
property within each District, listed in their names upon the last completed
assessment roll for state, county and school district taxes, at their last known
addresses. The notices for each District described the general character of the
Improvements proposed to be made therein or therefor, stated the estimated cost of
such Improvements and the method or methods of assessment of such costs against
properties in the District, specified the time when and the place where the
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Commission would hear and pass upon all protests made against the making of
such improvements or the creation or extension of such District, and referred to the
appropriate Resolution of Intention as being on file in the office of the Clerk of the
Commission for a description of the boundaries of the District, all in accordance
with the provisions of the Resolution of Intention.
1.03. Creation of Districts. At the times and places specified in the
notices hereinabove described, this Commission met to hear, consider and pass
upon all protests made against the making of the Improvements and the creation of
each of the Districts, and, after consideration thereof, it was determined and declared
that insufficient protests against the creation or extension of each of the Districts or
the proposed work had been filed in the time and manner provided by law by the
owners of the property to be assessed for the Improvements in the respective
Districts, and this Commission did therefore by Resolution Nos. 2999 and 3001,
adopted August 22, 1994, create the Districts and order the proposed Improvements
in each District in accordance with the Resolutions of Intention.
1.04. Construction Contracts. Plans, specifications, maps, profiles and
surveys for construction of the Improvements will be prepared by the engineers
acting for the City, approved by this Commission, advertised for bid in the official
newspaper of the City, and contracts awarded to the lowest responsible bidder in
accordance with the provisions of Montana Code Annotated, Section 7-12-4141. As
indicated in Section 1.05 below, the City estimates that the Improvements can be
completed for the respective amounts authorized for each District. In the event the
bids for construction cause the costs of the Improvements to exceed the amounts
available from the proceeds of the Bonds, the City has covenanted and hereby
confirms that it will use available funds of the City to complete the Improvements.
1.05. Costs. It is currently estimated that the costs and expenses
connected with and incidental to the formation of the Districts to the City, including
costs of preparation of plans, specifications, maps, profiles, engineering
superintendence and inspection, preparation of assessment rolls, expenses of
making the assessments, the cost of work and materials under the construction
contract and all other costs and expenses, including deposits to the Revolving Fund,
are $135,000 for District No. 660 and $239,600 for District No. 663, are as follows:
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District No. 660
Construction and Design $103,320
Administra tion 1,570
Bond Counsel 3,100
Consulting Fees 16,531
Revolving Fund 6,750
Contingency 3 ,729
Total: $135,000
District No. 663
Construction $173,161
Engineering 31,169
Legal & Administration 1,732
Subtotal 206,062
Less City's Shared Cost -10,060
Contingency $24,465
Revolving Fund 11,980
Administration 7,191
Total: $239,638
Such amounts will be levied and assessed upon the property within each of the
Districts on the bases described in the Resolutions of Intention. This Commission
has jurisdiction and is required by law to levy and assess such amounts, to collect
such special assessments and credit the same to the special improvement district
accounts created for each District, which accounts are to be maintained on the
official books and records of the City separate from all other City funds, within the
1994 Pooled Special Improvement District Sinking Fund (the "Sinking Fund") for
the payment of principal and interest when due on the bonds herein authorized.
1.06. Sale and Issuance of Bonds. Pursuant to Resolution No. 3018,
adopted October 10, 1994, the Commission determined that the issuance and sale of
bonds in a pooled single offering was in the best interests of the City and the Districts
and would facilitate the sale of the bonds at lower interest rates. The Commission
then called for the public sale of bonds in the total aggregate amount of $374,600 (the
"Bonds") which amount represents Bonds for each District as follows:
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Principal Amount
District No. of Bonds
No. 660 $135,000
No. 663 $239,600
Notice of the sale has been duly published in accordance with Montana Code
Annotated, Sections 7-12-4204, 7-7-4252 and 17-5-106. Modifications to the notice of
sale were subsequently made and distributed to prospective bidders on the Bonds.
The revised notice of sale, which is attached as Exhibit A hereto, is hereby ratified.
Pursuant to the notice of sale, two (2) sealed bids for the purchase of the Bonds were
received at or before the time specified for receipt of bids. The bids were opened and
publicly read and considered, and the purchase price, interest rates and net interest
cost under the terms of each bid were determined.
On October 24, 1994, this Commission authorized the City to enter into
a contract with Dain Bosworth Incorporated (the "Purchaser"), as the lowest
responsible bidder pursuant to which the Purchaser agreed to purchase from the
City the Bonds at a purchase price of $364,485.80 plus interest accrued thereon from
the date of original issue of the Bonds, at a net effective interest rate of 6.23897% per
annum and upon the further terms set forth in this resolution.
1.07. Recitals. All acts, conditions and things required by the
Constitution and laws of the State of Montana, including Montana Code Annotated,
Title 7, Chapter 12, Parts 41 and 42, as amended, in order to make the Bonds valid
and binding special obligations in accordance with their terms and in accordance
with the terms of this resolution have been done, do exist, have happened and have
been performed in regular and due form, time and manner as so required.
Section 2. The Bonds.
2.01. Principal Amount, Maturities, Denominations, Date, Interest
Rates. For the purpose of paying the costs and expenses incurred in construction of
the Improvements, and in anticipation of the collection of special assessments to be
levied therefor, and in accordance with the proposal described in Section 1.06, the
City shall forthwith issue and deliver to the Purchaser the Bonds payable solely
from the Sinking Fund and denominated "Pooled Special Improvement District
Bonds, Series 1994 (Special Improvement District Nos. 660 and 663)." The Bonds
shall be dated, as originally issued, and be registered as of November 1, 1994, shall
each be in the denomination of $1,000 or any integral multiple thereof of single
maturities; provided that the Bond representing principal installment no. 1 shall be
in the principal amount of $2,600; shall mature on July 1 in the years and principal
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amounts set forth below, and Bonds maturing in such years and principal amounts
shall bear interest from the date of original registration until paid or duly called for
redemption at the rates per annum set forth opposite such years and amounts,
respectively:
Principal Principal
Year Amount Rate Year Amount Rate
1996 $29,600 4.60% 2003 $15,000 5.80%
1997 35,000 4.80 2004 20,000 5.90
1998 35,000 5.10 2005 20,000 6.00
1999 35,000 5.30 2006 20,000 6.15
2000 35,000 5.50 2007 20,000 6.30
2001 35,000 5.60 2008 20,000 6.40
2002 35,000 5.70 2009 20,000 6.50
Each of the Bonds shall represent one or more principal installments of the issue of
the same maturity. Principal installments of the issue are numbered from 1
through 373, each in the amount of $1,000, except installment no. 1 shall be in the
- amourtt--of $2,600.
2.02. Interest Payment Dates. Interest on the Bonds shall be payable on
each January 1 and July 1, commencing January 1, 1996, to the owners of record
thereof as such appear on the bond registrar at the close of business on the fifteenth
day of the immediately preceding month, whether or not such day is a business day.
Upon the original delivery of the Bonds to the Purchaser and upon each subsequent
transfer or exchange of a Bond pursuant to Section 2.04, the Registrar shall date each
Bond as of the date of its authentication.
2.03. Method of Payment. The Bonds shall be issued only in fully
registered form. The interest on and, upon surrender thereof at the principal office
of the Registrar (as hereinafter defined), the principal of each Bond, shall be payable
by check or draft drawn on the Registrar.
2.04. Registration. The City hereby appoints the Director of Finance to
act as registrar, transfer agent and paying agent (the "Registrar"). The City reserves
the right to appoint a bank, trust company or financial institution as successor bond
registrar, transfer agent or paying agent, as authorized by the Model Public
Obligations Registration Act of Montana, Montana Code Annotated, Title 17,
Chapter 5, Part 11, as amended (the "Registration Act"), but the City agrees to pay the
reasonable and customary charges of the Registrar for the services performed. This
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Section 2.04 shall establish a system of registration for the Bonds as defined in the
Registration Act.
The effect of registration and the rights and duties of the City and the
Registrar with respect thereto shall be as follows:
(a) Bond Register. The Registrar shall keep at its principal office a bond
register in which the Registrar shall provide for the registration of ownership
of the Bonds and the registration of transfers and exchanges of the Bonds
entitled to be registered, transferred or exchanged.
(b) Transfer. Upon surrender to the Registrar for transfer of any Bond
duly endorsed by the registered owner thereof or accompanied by a written
instrument of transfer, in form satisfactory to the Registrar, duly executed by
the registered owner thereof or by an attorney duly authorized by the
registered owner in writing, the Registrar shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new Bonds
of a like aggregate principal amount and maturity, as requested by the
transferor. The Registrar may, however, close the books for registration of
any transfer of any Bond or principal installment thereof selected or called for
redemption. No transfer or exchange of a Bond shall affect its order of
registration for purposes of redemption pursuant to Section 2.05.
(c) Exchange. Whenever any Bond is surrendered by the registered
owner for exchange, the Registrar shall authenticate and deliver one or more
new Bonds of a like aggregate principal amount, interest rate and maturity
and representing the same principal installments, as requested by the
registered owner or the owner's attorney duly authorized in writing.
Cd) Cancellation. All Bonds surrendered upon any transfer or
exchange shall be promptly canceled by the Registrar and thereafter disposed
of as directed by the City.
(e) Improper or Unauthorized Transfer. When any Bond is presented
to the Registrar for transfer, the Registrar may refuse to transfer the same
until it is satisfied that the endorsement on such Bond or separate instrument
of transfer is valid and genuine and that the requested transfer is legally
authorized. The Registrar shall incur no liability for the refusal, in good faith,
to make transfers which it, in its judgment, deems improper or
unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the
person in whose name any Bond is at any time registered in the bond register
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as the absolute owner of such Bond, whether such Bond shall be overdue or
not, for the purpose of receiving payment of, or on account of, the principal of
and interest on such Bond and for all other purposes, and all such payments
so made to any such registered owner or upon the owner's order shall be
valid and effectual to satisfy and discharge the liability of the City upon such
Bond to the extent of the sum or sums so paid.
(g) Taxes, Fees and Charges. For every transfer of Bonds or exchange of
Bonds (except an exchange upon a partial redemption of a Bond), the
Registrar may impose a charge upon the owner thereof sufficient to
reimburse the Registrar for any tax, fee or other governmental charge
required to be paid with respect to such transfer or exchange.
(h) Mutilated, Lost, Stolen or Destroyed Bonds. In case any Bond shall
become mutilated or be destroyed, stolen or lost, the Registrar shall deliver a
new Bond of like amount, number, maturity date and tenor in exchange and
substitution for and upon cancellation of any such mutilated Bond or in lieu
of and in substitution for any such Bond destroyed, stolen or lost, upon the
payment of the reasonable expenses and charges of the Registrar in
connection therewith; and, in the case of a Bond destroyed, stolen or lost,
upon filing with the Registrar of evidence satisfactory to it that such Bond
was destroyed, stolen or lost, and of the ownership thereof, and upon
furnishing to the Registrar an appropriate bond or indemnity in form,
substance and amount satisfactory to it, in which both the City and the
Registrar shall be named as obligees. All Bonds so surrendered to the
Registrar shall be canceled by it and evidence of such cancellation shall be
given to the City. If the mutilated, destroyed, stolen or lost Bond has already
matured or such Bond has been called for redemption in accordance with its
terms, it shall not be necessary to issue a new Bond prior to payment.
2.05. Redemption. If on any interest payment date there will be a
balance in the Sinking 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 as provided in Section 3.02 or otherwise, the Director of
Finance shall call for redemption on the interest payment date outstanding Bonds,
or principal installments thereof, in the order of their registration in an amount
which, together with the interest thereon to the interest payment date, will equal
the amount of the Sinking Fund on that date. For purposes of redemption, the
order of registration of the Bonds shall correspond to the order of the numbers of
the principal installments represented by the Bonds. Bonds representing more than
one principal installment may be redeemed in part, in one or more whole principal
installments and, upon such partial redemption, a new Bond or Bonds will be
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delivered to the registered owner without charge, representing the remaining
principal installments outstanding. The Bonds are subject to redemption at the
option of the City from other sources of funds available therefor on any interest
payment date. The redemption price shall equal the amount of the principal
installment or installments of the Bonds to be redeemed plus interest accrued
thereon to the date of redemption. The date of redemption shall be fixed by the
Director of Finance, who shall give notice, by first class mail, postage prepaid to the
owner or owners of such Bonds at their addresses appearing in the bond register, of
the numbers of the principal installments and Bonds to be redeemed and the date
on which payment will be made, which date shall be not less than ten days after the
date of mailing notice. The Director of Finance shall at the same time mail notice of
the redemption to the Purchaser. On the date so fixed interest on the Bonds or
principal installments thereof so redeemed shall cease. Notwithstanding anything
to the contrary contained herein, the Bonds shall not be called for redemption from
the proceeds of refunding special improvement district bonds or warrants before
July 1, 1999.
In addition to the notice prescribed by the preceding paragraph, the
Director of Finance shall also give, or cause to be given, notice of the redemption of
any Bond or Bonds or principal installments thereof at least 35 days before the
redemption date by deposit of notice, properly addressed, in the United States Mail
with postage paid at the first class rate or telecopy to the Purchaser and all registered
securities depositories then in the business of holding substantial amounts of
obligations of the character of the Bonds {such depositories now being The
Depository Trust Company, of Garden City, New York; Midwest Securities Trust
Company, of Chicago, Illinois; and Philadelphia Depository Trust Company, of
Philadelphia, Pennsylvania} and one or more national information services that
disseminate information regarding municipal bond redemptions; provided that any
defect in or any failure to give any notice of redemption prescribed by this paragraph
shall not affect the validity of the proceedings for the redemption of any Bond or
portion thereof.
2.06. Form. The Bonds shall be drawn in substantially the form set
forth in Exhibit B hereto, and by this reference made a part hereof, with such
modifications as are permitted by the Act.
2.07. Execution. Registration and Delivery. The Bonds shall be
prepared under the direction of the Clerk of the Commission and shall be executed
on behalf of the City by the signatures of the City Manager and the Clerk of the
Commission and sealed with the official seal of the City; provided that the
signatures and the corporate seal may be printed, engraved or lithographed
facsimiles of the originals. In case any officer whose signature or a facsimile of
whose signature shall appear on the Bonds shall cease to be such officer before the
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delivery of any Bond, such signature or facsimile shall nevertheless be valid and
sufficient for all purposes, the same as if such officer had remained in office until
delivery. Notwithstanding such execution, no Bond shall be valid or obligatory for
any purpose or entitled to any security or benefit under this resolution unless a
certificate of authentication and registration on such Bond has been duly executed by
the manual signature of an authorized representative of the Registrar. Certificates
of authentication and registration on different Bonds need not be signed by the same
representative. The executed certificate of authentication and registration on each
Bond shall be conclusive evidence that it has been authenticated and delivered
under this resolution. The Bonds shall be registered in order of their serial numbers
by the Registrar, as attested by the Certificate of Authentication and Registration, as
of November 1, 1994. When the Bonds have been so executed, authenticated and
registered, they shall be delivered by the Registrar to the Purchaser upon payment of
the purchase price in accordance with the contract of sale heretofore made and
executed. The Purchaser shall not be obligated to see to the application of the
purchase price, but from the proceeds of the Bonds the Director of Finance shall
credit forthwith $18,730 to the Special Improvement District Revolving Fund of the
City, as authorized by Montana Code Annotated, Section 7-12-4169(2), and any
accrued interest to the Interest Subaccounts in the Sinking Fund, as provided in
Section 3.03, and the balance of such proceeds to the Construction Subaccounts in
the respective District Accounts, in proportion to the principal amounts of the
Bonds allocable to each of the Districts, as set forth in Section 1.06, to be used solely
for the purposes described in Section 3.02.
Section 3. Sinking Fund; Assessments.
3.01. Sinking Fund. There is hereby created and established the
Sinking Fund designated as the "1994 Pooled Special Improvement District Sinking
Fund," which shall be maintained by the Director of Finance on the books and
records of the City separate and apart from all other funds of the City. Within the
Sinking Fund there shall be maintained separate accounts for each of the Districts,
designated accordingly (collectively, the "District Accounts"). Within each District
Account there shall be maintained three separate subaccounts, designated as the
"Construction Subaccount," "Principal Subaccount" and "Interest Subaccount,"
respectively.
3.02. Construction Subaccounts. There shall be credited to the
Construction Subaccount in the District Accounts the proceeds of the sale of the
Bonds attributable to the respective District as provided in Section 2.07. Any
earnings on investment of money in a Construction Subaccount shall be retained
therein. All costs and expenses of constructing the Improvements to be paid from
proceeds of the Bonds in and for the benefit of a District shall be paid from time to
time as incurred and allowed from the Construction Subaccount in the respective
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District Account in accordance with the provisions of applicable law, and money in
the Construction Subaccount shall be used for no other purpose; provided that upon
completion of the Improvements in or for the benefit of a District and after all
claims and expenses with respect to such Improvements have been fully paid and
satisfied, any money remaining in said Construction Subaccount shall be transferred
to the Principal Account in the District Account for the District and used to redeem
Bonds as provided in Section 3.03.
3.03. Principal Subaccounts and Interest Subaccounts. Money in the
Principal Subaccounts and the Interest Subaccounts shall be used only for payment
of the principal of and interest on the Bonds as such payments become due or to
redeem Bonds. From the proceeds of the Bonds, there shall be deposited in the
Interest Subaccounts any interest on the Bonds accrued to the date of their delivery,
pro rata, in proportion to the principal amount of Bonds issued for such District as
set forth in Section 1.06.
Upon collection of the installment of principal and interest due on
November 30 and May 31 of each fiscal year on the special assessments to be levied
with respect to the Improvements in each of the Districts, the Director of Finance
shall credit to the Interest Subaccount in the respective District Account so much of
said special assessments as is collected as interest payment and the balance thereof to
the Principal Subaccount. Any installment of any special assessment paid prior to
its due date with interest accrued thereon to the next succeeding interest payment
date shall be credited with respect to principal and interest payments in the same
manner as other assessments are credited to the District Account. All money in the
Interest Subaccount and the Principal Subaccount shall be used first to pay interest
due, and any remaining money shall be used to pay Bonds then due and, if money is
available, to redeem Bonds or principal installments thereof in accordance with
Section 2.05; provided that any money transferred to a Principal Subaccount from
the Construction Subaccount pursuant to Section 3.02 shall be applied to redeem
Bonds or principal installments thereof to the extent possible on the next interest
payment date for which notice of redemption may properly be given pursuant to
Section 2.05. Redemption of Bonds shall be in order of the principal installments
they represent as provided in Section 2.05, and interest shall be paid as accrued
thereon to the date of redemption, in accordance with the provisions of Montana
Code Annotated, Section 7-12-4206.
3.04. Loans from Revolving Fund. The Commission shall annually or
more often if necessary issue an order authorizing a loan or advance from the
Special Improvement District Revolving Fund of the City (the "Revolving Fund")
to each of the District Accounts in an amount sufficient to make good any deficiency
then existing in the Interest Subaccount in the District Account, and shall issue an
order authorizing a loan or advance from the Revolving Fund to each of the District
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Accounts in an amount sufficient to make good any deficiency then existing in the
Principal Subaccount of the District Account, in such order and in each case to the
extent that money is available in the Revolving Fund. A deficiency shall be deemed
to exist in a Principal Subaccount or an Interest Subaccount in a District Account if
the money on deposit therein on any June 15 or December 15 (excluding amounts in
the Principal Subaccount representing prepaid special assessments) is less than the
amount necessary to pay Bonds due (other than upon redemption), and interest on
all Bonds payable, on the next succeeding interest payment date.
Pursuant to Ordinance No. 612, the City has undertaken and agreed to
provide funds for the Revolving Fund by levying such tax or making such loan
from the General Fund as authorized by Montana Code Annotated, Section
7-12-4222. In the event that the balance on hand in the Revolving Fund fifteen days
prior to any date when interest is due on special improvement district bonds or
warrants of the City is not sufficient to make good all deficiencies then existing in
the special improvement district funds for which the City has covenanted to make
loans from the Revolving Fund, the balance on hand in the Revolving Fund shall
be allocated to the funds of the special improvement districts in which such
deficiencies then exist in proportion to the amounts of the deficiencies on the
respective dates of receipt of such money, until all interest accrued on such special
improvement district bonds or warrants of the City has been paid. On any date
when all accrued interest on special improvement district bonds and warrants of the
City payable from funds for which the City has covenanted to make loans from the
Revolving Fund has been paid, any balance remaining in the Revolving Fund shall
be lent or advanced to the special improvement district funds for payment and
redemption of bonds to the extent the special improvement district funds are
deficient for such purpose, and, if money in the Revolving Fund is insufficient
therefor, pro rata, in an amount proportionate to the amount of such deficiency.
Section 4. Covenants. The City covenants and agrees with the owners
from time to time of each of the Bonds that until all the Bonds and interest thereon
are fully paid:
4.01. Compliance with Resolution. The City will hold the Sinking
Fund and the Revolving Fund as trust funds, separate and apart from all of its other
funds, and the City, its officers and agents, will comply with all covenants and
agreements contained in this resolution. The provisions hereinabove made with
respect to the Sinking Fund and the Revolving Fund are in accordance with the
undertaking and agreement of the City made in connection with the public offering
of the Bonds and the sale of the Bonds as set forth in Section 1.06.
4.02. Construction of Improvements. The City will do all acts and
things necessary to enforce the provisions of the construction contracts and bonds
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referred to in Section 1.04 and to ensure the completion of the Improvements for
the benefit of the Districts in accordance with the plans and specifications and
within the time therein provided, and will pay all costs thereof promptly as
incurred and allowed, out of the District Accounts to the extent the amount of the
proceeds of the Bonds appropriated thereto are sufficient to complete the
Improvements. To the extent such amounts are insufficient, the City will transfer
to the Construction Account sufficient moneys from other available sources to
complete the Improvements.
4.03. Levy of Assessments. The City will do all acts and things
necessary for the final and valid levy of special assessments upon all assessable real
property within the boundaries of the Districts in accordance with the Constitution
and laws of the State of Montana and the Constitution of the United States in an
aggregate principal amount not less than the following amounts for each of the
Districts:
District No. Principal Amount
660 $ 135,000.00
663 239,600.00
Such special assessments shall be levied on the basis or bases prescribed in the
Resolutions of Intention and, as authorized by Montana Code Annotated, Section
7-12-4190(2), shall be payable in equal semiannual installments of principal and
interest. The unpaid installments of the assessments shall bear interest at an annual
rate determined each fiscal year equal to the average annual interest rate borne by
the then outstanding Bonds. The assessments for Special Improvement District
No. 660 will be payable in installments on the 30th day of November in each of years
1995 through 2006 and on the 31st day of May in the years 1996 through 2007,
inclusive, if not theretofore paid, and shall become delinquent on such date unless
paid in full. The assessments for Special Improvement District No. 663 will be
payable in installments on the 30th day of November in each of years 1995 through
2008 and on the 31st day of May in the years 1996 through 2009, inclusive, if not
theretofore paid, and shall become delinquent on such date unless paid in full. The
first partial payment of each assessment shall include interest on the entire
assessment from the date of original registration of the Bonds to January 1, 1996, and
each subsequent partial payment shall include interest for six months on that
payment and the then remaining balance of the special assessment. The
assessments shall constitute a lien upon and against the property against which they
are made and levied, which lien may be extinguished only by payment of the
assessment with all penalties, costs and interest as provided in Montana Code
Annotated, Section 7-12-4191. No tax deed issued with respect to any lot or parcel of
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land shall operate as payment of any installment of the assessment thereon which is
payable after the execution of such deed, and any tax deed so issued shall convey title
subject only to the lien of said future installments, as provided in Montana Code
Annotated, Section 15-18-214.
4.04. Reassessment. If at any time and for whatever reason any special
assessment or tax herein agreed to be levied is held invalid, the City and this
Commission, its officers and employees, will take all steps necessary to correct the
same and to reassess and re-Ievy the same, including the ordering of work, with the
same force and effect as if made at the time provided by law, ordinance or resolution
relating thereto, and will reassess and re-Ievy the same with the same force and
effect as an original levy thereof, as authorized in Montana Code Annotated, Section
7-12-4186. Any special assessment, or reassessment or re-Ievy shall, so far as is
practicable, be levied and collected as it would have been if the first levy had been
enforced including the levy and collection of any interest accrued on the first levy.
If proceeds of the Bonds, including investment income thereon, are
applied to the redemption of such Bonds, as provided in Montana Code Annotated,
Sections 7-12-4205 and 7-12-4206, or if refunding bonds are issued and the principal
amount of the outstanding Bonds of the Districts is decreased or increased, the City
will reduce or increase, respectively, the assessments levied in the respective
Districts and then outstanding pro rata by the principal amount of such prepayment
or the increment above or below the outstanding principal amount of bonds
represented by the refunding bonds. The City and this Commission, its officers and
employees will reassess and re-Ievy such assessments, with the same effect as an
original levy, in such reduced or increased amounts in accordance with the
provisions of Montana Code Annotated, Sections 7-12-4176 through 7-12-4178.
4.05. Absence of Litigation. There is now no litigation pending or, to
the best knowledge of the City, threatened questioning the validity or regularity of
the creation of the Districts, the contracts for construction of the Improvements or
the undertaking and agreement of the City to levy special assessments therefor and
to make good any deficiency in the collection thereof through the levy of taxes for
and the making of advances from the Revolving Fund, or the right and power of
the City to issue the Bonds or in any manner questioning the existence of any
condition precedent to the exercise of the City's powers in these matters. If any such
litigation should be initiated or threatened, the City will forthwith notify in writing
the Purchaser, and will furnish the Purchaser a copy of all documents, including
pleadings, in connection with such litigation.
4.06. Waiver of Penalty and Interest. The City covenants not to waive
the payment of penalty or interest on delinquent assessments levied on property in
the Districts for costs of the Improvements, unless the City determines, by
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resolution of the City Commission, that such waiver is in the best interest of the
owners of the outstanding Bonds.
Section 5. Tax Matters.
5.01. Use of Improvements. The Improvements will be owned and
operated by the City and available for use by members of the general public on a
substantially equal basis. The City shall not enter into any lease, use or other
agreement with any non-governmental person relating to the use of the
Improvements or security for the payment of the Bonds which might cause the
Bonds to be considered "private activity bonds" or "private loan bonds" within the
meaning of Section 141 of the Internal Revenue Code of 1986, as amended (the
"Code").
5.02. General Covenant. The City covenants and agrees with the
owners from time to time of the Bonds that it will not take or permit to be taken by
any of its officers, employees or agents any action which would cause the interest on
the Bonds to become includable in gross income for federal income tax purposes
under the Code and applicable Treasury Regulations (the "Regulations"), and
covenants to take any and all actions within its powers to ensure that the interest on
the Bonds will not become includable in gross income for federal income tax
purposes under the Code and the Regulations.
5.03. Arbitrage Certification. The City Manager and the Clerk of the
Commission, being the officers of the City charged with the responsibility for issuing
the Bonds pursuant to this resolution, are authorized and directed to execute and
deliver to the Purchaser a certificate in accordance with the provisions of Section 148
of the Code, and Sections 1.148-2(b) of the Regulations, stating that on the basis of
facts, estimates and circumstances in existence on the date of issue and delivery of
the Bonds, it is reasonably expected that the proceeds of the Bonds will be used in a
manner that would not cause the Bonds to be "arbitrage bonds" within the meaning
of Section 148 of the Code and the Regulations.
5.04. Arbitrage Rebate Exemption.
(a) The City hereby represents that the Bonds qualify for the exception
for small governmental units to the arbitrage rebate provisions contained in Section
148(f) of the Code. Specifically, the City represents:
(1) Substantially all (not less than 95%) of the proceeds of the Bonds
(except for amounts to be applied to the payment of costs of issuance and
amounts to be deposited in the Interest Subaccounts pursuant to Section 3.03)
will be used for local governmental activities of the City.
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(2) The aggregate face amount of all "tax-exempt bonds" (including
warrants, contracts, leases and other indebtedness, but excluding private
activity bonds) issued by or on behalf of the City and all subordinate entities
thereof during 1994 is reasonably expected not to exceed $5,000,000. To date in
1994, the City has issued no such tax-exempt bonds, except $295,900 Special
Improvement District No. 662 Bonds and in the calendar years 1989 through
1993, the average principal amount of such tax-exempt bonds issued by the
City in a single calendar year was $735,738.
(b) If notwithstanding the provisions of paragraph (a) of this Section
5.04, the arbitrage rebate provisions of Section 148(f) of the Code apply to the Bonds,
the City hereby covenants and agrees to make the determinations, retain records and
rebate to the United States the amounts at the times and in the manner required by
said Section 148(f).
5.05. Information Reporting. The City shall file with the Secretary of
the Treasury, not later than February 15, 1995 a statement concerning the Bonds
containing the information required by Section 149(e) of the Code.
5.06. "Qualified Tax-Exempt Obligations." Pursuant to Section
265(b)(3)(B)(ii) of the Code, the City hereby designates the Bonds as "qualified
tax-exempt obligations" for purposes of Section 265(b)(3) of the Code. The City has
not designated any obligations in 1994 other than the Bonds under Section 265(b)(3).
The City hereby represents that it does not anticipate that obligations bearing interest
not includable in gross income for purposes of federal income taxation under
Section 103 of the Code (including refunding obligations as provided in Section
265(b)(3) of the Code and including "qualified 501(c)(3) Bonds" but excluding other
"private activity bonds," as defined in Sections 141(a) and 145(a) of the Code) will be
issued by or on behalf of the City and all "subordinate entities" of the City in 1994 in
an amount greater than $10,000,000.
Section 6. Authentication of Transcript. The officers of the City are
hereby authorized and directed to furnish to the Purchaser and to bond counsel
certified copies of all proceedings relating to the issuance of the Bonds and such
other certificates and affidavits as may be required to show the right, power and
authority of the City to issue the Bonds, and all statements contained in and shown
by such instruments, including any heretofore furnished, shall constitute
representations of the City as to the truth of the statements purported to be shown
thereby.
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Section 7. Discharge.
7.01. General. When the liability of the City on all Bonds issued under
and secured by this resolution has been discharged as provided in this Section 7, all
pledges, covenants and other rights granted by this resolution to the owners of such
obligations shall cease.
7.02. Payment. The City may discharge its liability with reference to
any Bond or installment of interest thereon which is due on any date by on or before
that date depositing with the Registrar funds sufficient, or, if a City officer is the
Registrar, mailing to the registered owner of such Bond a check or draft in a sum
sufficient and providing proceeds available, for the payment thereof in full; or if any
Bond or installment of interest thereon shall not be paid when due, the City may
nevertheless discharge its liability with reference thereto by depositing with the
Registrar funds sufficient, or, if a City officer is the Registrar, by mailing to the
registered owner thereof a check or draft in a sum sufficient and providing proceeds
available, for the payment thereof in full with interest accrued to the date of such
deposit or mailing.
7.03. Prepayment. The City may also discharge its obligations with
respect to any Bonds called for redemption on any date when they are prepayable
according to their terms, by on or before that date depositing with the Registrar
funds sufficient, or, if a City officer is the Registrar, mailing to the registered owner
of such Bond a check or a draft in a sum sufficient and providing proceeds available,
for the payment of the principal, interest and redemption premium, if any, which
are then due; provided that notice of such redemption has been duly given as
provided herein or irrevocably provided for.
7.04. Escrow. The City may also at any time discharge its liability in its
entirety with reference to the Bonds, subject to the provisions of law now or
hereafter authorizing and regulating such action, by depositing irrevocably in
escrow, with a bank qualified by law as an escrow agent for this purpose, cash or
securities which are authorized by law to be so deposited, bearing interest payable at
such times and at such rates and maturing on such dates as shall be required,
without reinvestment, to provide funds sufficient to pay all principal and interest to
become due on all Bonds on or before maturity or, if any Bond has been duly called
for redemption or notice of such redemption has been irrevocably provided for, on
or before the designated redemption date.
Section 8. Repeals and Effective Date.
8.01. Repeal. All provisions of other resolutions and other actions and
proceedings of the City and this Commission that are in any way inconsistent with
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the terms and provisions of this resolution are repealed, amended and rescinded to
the full extent necessary to give full force and effect to the provisions of this
resol ution.
8.02. Effective Date. This resolution shall take effect immediately upon
its passage and adoption by this Commission.
PASSED by the City Commission of the City of Bozeman, Montana,
this 31st day of October, 1994.
Attest: GJd:v :i J!/~
Clerk of the Commission
(SEAL)
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EXHIBIT B
[Face of the Bond]
UNITED STATES OF AMERICA
STATE OF MONTANA
COUNTY OF GALLATIN
CITY OF BOZEMAN
$374,600 POOLED SPECIAL IMPROVEMENT
DISTRICT BONDS, SERIES 1994
(Special Improvement District Nos. 660 and 663)
Interest at the rate per annum specified below
Payable January 1, 1996 and semiannually thereafter
on the 1st day of January and the 1st day of July
in each year.
No. $
Representing Principal Installment Nos. _
Date of Original
Rate Maturity Issue CUSIP
November 1, 1994
REGISTERED OWNER:
SEE REVERSE
FOR CERTAIN
DEFINITIONS
PRINCIPAL AMOUNT: DOLLARS
The Director of Finance of the City of Bozeman, Gallatin County,
Montana, will pay to the registered owner identified above, or registered assigns, on
the maturity date specified above the principal amount specified above, solely from
the revenues hereinafter specified, as authorized by Resolution No. 3026 adopted
October 31, 1994 (the "Resolution"), all subject to the provisions hereinafter
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described relating to the redemption of this Bond before maturity. This Bond bears
interest at the rate per annum specified above from the date of registration of this
Bond, as expressed herein, or from such later date to which interest hereon has been
paid or duly provided for, until the maturity date specified above or an earlier date
on which this Bond shall have been duly called for redemption by the Director of
Finance. Interest on this Bond is payable semiannually, commencing January 1,
1996, on the first day of January and the first day of July in each year, to the owner of
record of this Bond appearing as such in the bond register as of the close of business
on the 15th day (whether or not such is a business day) of the immediately preceding
month. Interest on and, upon presentation and surrender hereof at the principal
office of the bond registrar and paying agent hereinafter named, the principal of this
Bond are payable by check or draft of the Director of Finance, as bond registrar and
paying agent, or its successor designated under the Resolution (the "Registrar"). The
principal of and interest on this Bond are payable in lawful money of the United
States of America.
Additional provisions of this Bond are contained on the reverse hereof
and such provisions shall for all purposes have the same effect as though fully set
forth herein.
This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security or benefit under the Resolution until the Certificate of
Authentication and Registration herein shall have been executed by the Registrar by
the manual signature of one of its authorized representatives.
IN WITNESS WHEREOF, the City of Bozeman, Gallatin County,
Montana, by its City Commission, has caused this Bond and the certificate on the
reverse hereof to be executed by the facsimile signatures of the City Manager and the
Clerk of the Commission, and by a printed facsimile of the official seal of the City.
CITY OF BOZEMAN, MONTANA
(Facsimile Signature) (Facsimile Signature)
CLERK OF THE COMMISSION CITY MANAGER
(Facsimile Seal)
Dated:
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CERTIFICATE OF AUTHENTIC A TION AND REGISTRATION
This is one of the Bonds delivered pursuant to the Resolution
mentioned herein.
DIRECTOR OF FINANCE,
as Bond Registrar, Transfer
Agent and Paying Agent
By
Authorized Representative
[Reverse of the Bonds]
This Bond is one of an issue in the aggregate principal amount of
$374,600 (the "Bonds"), all of like date of original issue and tenor, except as to serial
number, denomination, date, interest rate and maturity date. The Bonds are issued
pursuant to and in full conformity with the Constitution and laws of the State of
Montana thereunto enabling, including Montana Code Annotated, Title 7, Chapter
12, Parts 41 and 42, as amended, to finance the costs of certain local improvements
(the "Improvements") for the special benefit of property located in the following
Special Improvement Districts of the City: Special Improvement District Nos. 660
and 663 (collectively, the "Districts"). The Bonds are issuable only as fully registered
bonds of single maturities in denominations of $1,000 or any integral multiple
thereof; provided that the Bond representing principal installment no. 1 shall be in
the principal amount of $2,600. This Bond represents one or more principal
installments of an issue of Bonds of the City numbered as set forth above. The
principal installments for the issue are in the aggregate amount of $374,600, and are
numbered from 1 though 373, each in the amount of $1,000, except installment no. 1.
shall be in the amount of $2,600.
This Bond is payable from the collection of a special tax or assessment
levied upon all property within the boundaries of the Districts, in an aggregate
principal amount of not less than $135,000 for Special Improvement District No. 660
and $239,600 for Special Improvement District No. 663, except as such amounts may
be reduced or increased in accordance with provisions of Montana law. Such
assessments constitute a lien against the assessable real estate within the Districts,
and the Bonds are not general obligations of the City.
The principal installments of the Bonds are subject to mandatory
redemption in order of registration on any interest payment date if, after paying all
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principal and interest then due on the Bonds, there are funds to the credit of the
1994 Pooled Special Improvement District Sinking Fund of the City (in which the
district fund for each of the special improvement districts described in the title
hereof constitutes an account), from the prepayment of assessments levied in the
Districts or from surplus proceeds of the Bonds not required to pay costs of the
Improvements, for the redemption thereof, and in the manner provided for the
redemption of the same. The Bonds are subject to redemption at the option of the
City from other sources of funds available therefor on any interest payment date,
provided, however, the City has agreed the Bonds shall not be called for redemption
from the proceeds of refunding special improvement district bonds or warrants
before July 1, 1999. The redemption price is equal to the amount of the principal
installment or installments of the Bonds to be redeemed plus interest accrued
thereon to the date of redemption. The date of redemption shall be fixed by the
Director of Finance, who shall give notice by first class mail, postage prepaid, to the
owner or owners of such Bonds at their addresses shown on the bond register, of the
numbers of the principal installments and Bonds to be redeemed and the date on
which payment will be made, which date shall not be less than ten days after the
date of mailing of notice, on which date so fixed interest shall cease. On the date so
fixed interest on the Bonds or principal installments thereof so redeemed shall cease
to accrue. Upon partial redemption of any Bond, a new Bond or Bonds will be
delivered to the registered owner without charge, representing the remaining
principal installments outstanding.
As provided in the Resolution and subject to certain limitations set
forth therein, this Bond is transferable upon the books of the City at the principal
office of the Registrar, by the registered owner hereof in person or by his attorney
duly authorized in writing upon surrender hereof together with a written
instrument of transfer satisfactory to the Registrar, duly executed by the registered
owner or his attorney; and may also be surrendered in exchange for Bonds of other
authorized denominations. Upon such transfer or exchange, the City will cause a
new Bond or Bonds to be issued in the name of the transferee or registered owner, of
the same aggregate principal amount, representing the same principal installments, .
bearing interest at the same rate and maturing on the same date, subject to
reimbursement for any tax, fee or governmental charge required to be paid with
respect to such transfer or exchange.
The City and the Registrar may deem and treat the person in whose
name this Bond is registered as the absolute owner hereof, whether this Bond is
overdue or not, for the purpose of receiving payment and for all other purposes, and
neither the City nor the Registrar shall be affected by any notice to the contrary.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED
that all things required to be done precedent to the issuance of this Bond have been
properly done, happened and been performed in the manner prescribed by the laws
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of the State of Montana and the resolutions and ordinances of the City of Bozeman,
Montana, relating to the issuance thereof.
The following abbreviations, when used in the inscription on the face
of this Bond, shall be construed as though they were written out in full according to
applicable laws or regulations:
TEN COM -- as tenants UTMA.....Custodian.......
in common (Cus!) (Minor)
TEN ENT -- as tenants
by the entireties
under Uniform Transfers to Minors
JT TEN -- as joint tenants
with right of Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
survivorship and
(State)
not as tenants in
common
Additional abbreviations may also be used.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto the within Bond and all rights thereunder, and
hereby irrevocably constitutes and appoints attorney to transfer the within
Bond on the books kept for registration thereof, with full power of substitution in
the premises.
Dated:
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER NOTICE: The signature to this
OF ASSIGNEE: assignment must correspond
with the name as it appears
/ / upon the face of the within
Bond in every particular, without
alteration, enlargement or any change
whatsoever.
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SIGNATURE GUARANTEED
Certificate as to Legal Opinion
The following certificate shall be printed on the reverse of each
Bond, following a full, true and correct copy of the text of the legal opinion given at
the time of delivery of the Bonds:
We certify that the foregoing is a full, true and correct copy of the
opinion of Bond Counsel on the issue of Bonds of the City of Bozeman, Montana,
which includes the within Bond, dated as of the date of delivery of and payment for
the Bonds.
(Facsimile Signature)
CITY MANAGER
(Facsimile Signature)
CLERK OF THE COMMISSION
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