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HomeMy WebLinkAboutOrd 353-2007 Relating to Bonds proposed to be issued by GTUA.pdfOrdinance No. M-2007 AN ORDINANCE by the City Council of the City of Anna, Texas, relating to bonds proposed to be issued and delivered by the Greater Texoma Utility Authority, approving the issuance thereof, and the facilities to be constructed or acquired by such Authority. WHEREAS, the Greater Texoma Utility Authority (the "Authority") and the City of Anna, Texas (the "City"), have previously executed and delivered an Amended and Restated Contract for Water Supply and Sewer Service (the "Contract") whereby the Authority is to provide water and sewer services to the City; WHEREAS, under Section 4.15 of the Contract, it is provided that the City shall approve the issuance by the Authority of any bonds that are to be payable from certain moneys that the City has contracted to pay under the provisions of the Contract; WHEREAS, in connection with the proposed "Greater Texoma Utility Authority Contract Revenue Bonds, Series 2007" (Cities of Anna and Melissa Project) (the "Bonds"), the Texas Water Development Board has agreed, pursuant to an Application Requesting Financial Assistance (the "Application"), to purchase the Bonds and, therefore, it is neither necessary nor advisable for the Authority to prepare a Notice of Sale because, insofar as the City is concerned, the Application contains sufficient information to accomplish the purpose of a Notice of Sale; and WHEREAS, the net effective interest rate on the Bonds will not exceed fifteen percent (15%) per annum and it is now appropriate for this Council to approve the Application (in lieu of approving a Notice of Sale with respect to the Bonds) as well as the issuance and delivery of the Bonds and the facilities to be constructed or acquired with the proceeds of the Bonds for the Project described in Exhibit A attached to the Resolution of the Authority to be adopted December 17, 2007 (the "Bond Resolution"), authorizing the Bonds; now, therefore, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS: Section 1: The facilities to be acquired and/or constructed by the Authority with the proceeds of the Bonds for the Project described in Exhibit A attached to the Bond Resolution are hereby approved. The use of the proceeds of the Bonds, as described in Exhibit A attached to the Bond Resolution, is hereby approved. The Bond Resolution is approved as to form and content and the City of Anna acknowledges that the payment of principal of and interest on the Bonds is payable, in whole or in part, from payments to be made by the City of Anna under and pursuant to the Contract. The City agrees to provide the reports described in Section 21 of the Bond Resolution within the times specified therein. The City agrees with the obligations and conditions set forth in the Board's Commitment 06-72 including, without limitation, to make payments pursuant to the Contract in the amounts specified in Section I.F. of the Application with respect to "Series B" as referred to therein as approved by the Commitment. A copy of such commitment is attached hereto as Exhibit B. Section 2: It is the purpose and intent of the City Council of the City to approve the Bond Resolution, and the facilities to be constructed or acquired in full accordance with the provisions of the Contract mentioned in the preamble hereof. To the extent required by the Texas Water Development Board or the Office of the Attorney General of Texas, the Authority is authorized by this City Council to make changes and revisions from the form approved by this 70102790.1110700983 ordinance in order to expedite the delivery of the Bonds. It is the intent of the City to authorize the Authority to proceed with the construction or acquisition of the facilities at the earliest possible date, but nothing herein shall be construed as a limitation upon the right and power of the City to approve a change in the facilities for which the Bonds are to be issued (but not the purpose for which the Bonds are to be issued as set forth in the Bond Resolution), the City specifically reserving the right to modify the facilities for which the Bonds are being issued if the Authority and the City agree such modification should be made. Section 3: The Contract is amended to include the definition of Project attached hereto as Exhibit A. A copy of Exhibit A shall be attached to the Contract, as Exhibit A. Additionally, the Contract is reapproved and shall be and remain in full force as the agreement of the parties. (remainder of page left blank intentionally) 701027W,1110700983 PASSED AND APPROVED, this December 11, 2007. i < r / City of Anna, Texas ATTEST: / Ci Secretary Ci of Anna, Texas (Seal) �o°;`y.OF Ah 70102790.1/10700983 S-1 EXHIBIT A PROJECT DESCRIPTION The Project consists of the design and construction of sanitary sewer system improvements for the Throckmorton Creek and Trinity River drainage basins, located within the City limits of Melissa and Anna, Texas. The project will serve the Cities of Melissa and Anna, Texas. Phase I of the Project, a 21 -inch interceptor along the southern end of the service area, was constructed in 2001. Two additional phases of design and construction of sanitary sewer improvements in the Throckmorton Creek and Trinity River drainage basins are proposed under the current project. Phase 11 consists of design and construction of the northern portion of the project. Phase II improvements will be constructed and connected to Phase I improvements. Phase III of the project consists of constructing a new interceptor parallel to Phase I improvements. 70102790,1110700983 A-1 COMMITMENT OF TEXAS WATER DEVELOPMENT BOARD 701027N.IM0700M B -t A RESOLUTION OF THE TEXAS WATER DEVELOPMENT BOARD APPROVING AN APPLICATION FOR FINANCIAL ASSISTANCE IN THE TOTAL AMOUNT OF $7,300,000 CONSISTING OF THE PURCHASE OF $3;870,000 GREATER TEXOMA UTILITY AUTHORITY CONTRACT REVENUE BONDS, PROPOSED SERIES 2006 AND $3,430,000 GREATER TEXOMA UTII.ITY.AUTHORITY CONTRACTREVENUE BONDS, PROPOSED SERIES 2007 (06-72) WHEREAS, Greater Texoma Utility Authority (the "Authority"), on behalf of the Cities of Melissa and Anna (the "Cities"), has filed an application seeking financial assistance in the total amount of $7,300,000 from the Clean Water State Revolving Fund to finance improvements to the Cities' wastewater systems; and WHEREAS, the Authority seeks financial assistance from the Texas Water Development Board (the "Board") in the total amount of $7,300,000 consisting of the Board's purchase of $3;870,000 Greater Texoma Utility Authority, Contract Revenue Bonds, proposed Series 2006 and $3,430,000 Greater Texoma Utility Authority, Contract Revenue Bonds, proposed Series 2007, all anis more specifically set forth in the application and in recommendations of the Deputy Executive Administrator for the Office of Project Finance and Construction Assistance, to which documents expressreference is made; and WHEREAS, the Board hereby,finds: I. that in its opinion the revenue pledged by the Authority will be sufficient to meet all the obligations assumed by the Authority; _ 2.-' that the application and assistance applied for meet the requirements of the Federal Water Pollution Control Act, as amended (33 U.S.C. 1251 et seq.) and state law; 3. that the Authority will consider cost-effective innovative methods of treatment; and 4, that the Authority has submitted a proposed program of water conservation for the more efficient use of water that will meet reasonably anticipated local needs and conditions and that incorporates practices, techniques or technology prescribed by the Texas Water Code and rules of the Board.. NOW, THEREFORE, based on said considerations and findings, the Texas Water Development Board resolves as follows: A commitment is made by the Board to Greater Texoma Utility Authority, on behalf of the Cities of Melissa and Anna, for financial assistance in the total amount of $7,300,000 consisting of the Board's purchase of $3,870,000 Greater Texoma Utility Authority, Contract Revenue Bonds, proposed Series 2006 and $3,430,000 Greater Texoma Utility Authority, Contract Revenue Bonds, proposed Series 2007. This commitment will expire August 31, 2008. Such commitment is conditioned as follows: I. that the bond counsel opinion must include an opinion that the interest on the obligations is excludable from gross income or is exempt from Federal income taxation. Bond counsel may rely on covenants and representations of the issuer in rendering this opinion; 2. that the bond counsel opinion must include an opinion that the obligations are not "private activity bonds." Bond counsel may rely on covenants and representations of the issuer on rendering this opinion; 3. that the resolution authorizing the issuance of the obligations must include that the proceeds of the obligations and the facilities financed with the proceeds of the obligations will not be used in a manner that would cause the obligations to be "private activity bonds;" 4. that the resolution authorizing the issuance of the obligations must include that the issuer wil] comply with the provisions of Section 148 of the Internal Revenue Code of 1986 (relating to arbitrage); 5. that the resolution authorizing the issuance of the obligations must include that the issuer will make any required rebate to the United States of arbitrage earnings; 6. that the resolution authorizing the issuance of the obligations must include that the issuer will take no action which would cause the interest on the obligations to be includable in gross income for Federal income tax purposes; 7. that the transcript must include a No Arbitrage Certificate or similar certificate setting forth the issuer's reasonable expectations regarding the use, expenditure and investment of the proceeds of the obligations; 8. that the transcript must include evidence that the information reporting requirements of Section 149(e) of the Internal Revenue Code of 1986 will be satisfied. This requirement is currently satisfied by filing IRS Form 8038 with the Internal Revenue Service. A completed copy of IRS Form 8038 must be provided to the Executive Administrator prior to release of funds; 9. that the Authority will not cause or permit the obligations to be treated as "Federally Guaranteed" obligations within the meaning of Section 149(b) of the Internal Revenue Code; , 10. that this commitment is contingent on a future sale of bonds or on the availability of funds on hand; 11, that the resolution authorizing the issuance of obligations will state that obligations can be called for early redemption only in inverse order of maturity, and on any date beginning on or after the first interest payment date which is 10 I, years from the dated date of the obligations, at a redemption price of par, together with accrued interest to the date fixed for redemption; - 11 that the Authority, or an obligated person for whom financial or operating data is presented either individually or in combination with other issuers of the Authority's obligations or obligated persons, will, at.a minimum,. covenant to comply with requirements for continuing disclosure on an ongoing basis substantially in the manner required by Securities and Exchange Commission (SEC) rule 15c2-12 and determined as if the Board werea Participating Underwriter within the meaning of such rule, such continuing disclosure undertaking being for the benefit of the Board and the beneficial owner of the Authority's obligations, if the Board sells or otherwise transfers such obligations, and the Beneficial owners of the Board's bonds if the Authority is an obligated person with respect to such bonds under SEC rule 15c2-12;... - 13. that the resolution authorizing the obligations contain a provision that the Authority will maintain rates and charges to the Contracting Parties sufficient to meet the debt service requirements on the outstanding obligations of the Authority that are supported by such revenues, and that the Authority will require in its contracts with the Contracting Parties that the Contracting Parties maintain rates and charges for its water and sewer systems sufficient to pay the Contracting iParties obligations secured by and made payable from the revenues derived from the operationofits water and sewer systems; 14, that prior to closing, the Authority will submit documentation evidencingthe x adoption and implementation of sufficient system rates and charges or, if applicable, the levy of an interest and sinking tax rate sufficient for the repayment of system debt service requirements; 15. that upon request by the Executive Administrator, the Authority shall submit annual audits of Contracting Parties for the Executive Administrator's review; 1& that prior to or at closing, the. Authority shall pay to the Board a 1.85 percent origination charge calculated pursuant to Board rules; 17. that the loan is approved for funding under the Board's pre -design funding option as specified in Board rule 31 TAC §375.39, and initial and future releases of funds are subject to all rules of the Board relating to such funding option; 18. that prior to closing, the Authority shall submit an executed consulting engineer contract, the form and substance of which is satisfactory to the Executive Administrator of the Board; and .. 19. that prior to closing: (a) the Authority shall adopt and implement the program of water conservation as approved by the Board; and (b) the Authority shall include in its contract with the Contracting Parties requirement that the Contracting Parties adopt a water conservation plan that complies with Board rules and that is approved by the Authority. PROVIDED, however, the foregoing resolution is subject to the following additional requirements prior to funding of the loan: 1. issuance of a written approving opinion of the Attorney General of the State of Texas stating that all of the requirements of the laws under which said obligations were issued have been complied with; that said obligations were issued in conformity with the Constitution and laws of the State of Texas; and that said obligations are valid and binding obligations of the issuer; and 2. compliance with all applicable requirements contained in the Rules. Regulations. and Policies of the Texas Water Development Board. APPROVED and ordered of record this the 15th day of August 2006. TEXAS WATER DEVEI.OPMENi' BOARD E.G. Rod Pittman, Chairman F -M-110-449 Jikevin Ward�� Executive Administrator