1039_00001CITY OF MOSES LAKE,WASHINGTON
ORDINANCE NO.1039
AN ORDINANCE of the City of Moses Lake,Washington,amending Ordinance No.999;provid-ing for the issuance of $985,000 par value of"Water and Sewer Revenue Bonds,1981,"for thepurposeofobtainingfundstopaythecostofcarryingoutthesystemorplanofadditionstoandbettermentsandextensionsofthewaterworksutilityoftheCity,including the sewerage sys-tem as a part thereof,as specified and adoptedinOrdinanceNo.999 as amended herein,and ap-plicable to Utility Local Improvement DistrictsNos,l and 2;fixing the date,denomination,interest rates,form,terms and covenants ofsuchbonds;and providing for the sale anddeliveryofsuchbondstoSeattle-NorthwestSecuritiesCorporationofSeattle,Washington.
i WHEREAS,the City of Moses Lake,Washington (the "City"),
heretofore combined its existing water system and system of sewer-
age into a waterworks utility system of the City and the word
"System"shall hereinafter mean the combined water system and
system of sewerage of the City together with all additions thereto
and betterments and extensions thereof hereafter made;and
WHEREAS,pursuant to Ordinance No.290 of the City,
passed and approved October 25,1955,the City issued and sold
$1,100,000.00 par value of "Water and Sewer Revenue Bonds,Series
A,"dated November 1,1955,for the purpose of providing funds to
redeem and retire outstanding "Water and Sewer Revenue Coupon
Warrants"of the City and to acquire,construct and install certain
additions
W
dERimAprovbemente ito and ex dn annce othe System;C dy
reserved the right to issue additional water and sewer revenue
bonds on a parity with the "Water and Sewer Revenue Bonds,Series
A,"if certain conditions are met and complied with at the time of
the issuance of such additional bonds;and
WHEREAS,the City subsequently issued and sold $200,000
par value of "Water and Sewer Revenue Bonds,1965,"issued pursuant
to Ordinance No.532,$315,000 par value of "Water and Sewer Revenue
Bonds,1967,"issued pursuant to Ordinance No.573 and $1,100,000
par value of "Water and Sewer Revenue Bonds,1973,"issued pursuant
to Ordinance No.670,all of which bonds were issued on a parity of
lien with the "Water and Sewer Revenue Bonds,Series A,"and with
each other and constitute a first and prior charge and lien on the
Net Revenue of the Waterworks Utility of the City (as herein
defined);and
i WHEREAS,by Ordinance No.999,passed and approved on
February 10,1981,as amended herein,the City specified and
adopted a system or plan of additions to and betterments and
extensions of the System,converted Local Improvement District
No.43 to Utility Local Improvement District No.1 and Local
Improvement District No.46 to Utility Local Improvement District
No.2 and authorized the issuance and sale of water and sewer
revenue bonds in the principal sum of approximately $985,000 to
provide the funds necessary to carry out such system or plan;and
WHEREAS,by Ordinance No•1037,passed by the City Coun-
cil and approved by the Mayor on November 24,1981,the assessment
roll in Utility Local Improvement District No.1 was confirmed in
tbhye thota amCo
no
f $4n65,320 51e,and by OradinanceNNovem1ber 24pass9ed
the assessment roll in Utility Local Improvement District No.2 was
confirmed in the total amount of $364,273.70;and
ORD.1039 -2 -
$WHEREAS,the City Council has now determined that the
entire $985,000 par value of water and sewer revenue bonds of the
City should be issued to obtain the funds with which to pay the
cost of carrying out such system or plan of additions to and
betterments and extensions of the System as specified and adopted
in Ordinance No.999,as amended herein;NOW,THEREFORE,
THE CITY COUNCIL OF THE CITY OF MOSES LAKE,WASHINGTON,
DO ORDAIN,as follows:
Section 1.Section 4 of Ordinance No.999 is amended to
read as follows:
Section 4.The estimated cost,as near as may be,of the
aforesaid system or plan of additions,extensions and betterments
to the WateSrwo kan UtilitS
ct
onhe CityOr ndaeneceared t90 b $9a en0d0ed
to
read as follows:
Section 5.The cost of acquiring,constructing and
making the foregoing additions to and betterments and extensions of
the Waterworks Utility of the City shall be paid from the issuance
and sale of water and sewer revenue bonds in the amount of approxi-
mately $985,000 which are hereby authorized.
The water and sewer revenue bonds herein authorized to be
issued shall bear such designation,shall bear interest payable
semiannually,except that the first interest payment may be for a
different period of time,shall be numbered from "one"upward,con-
secutively,within each series as issued if issued in series,and
shall be payable out of such special fund heretofore or hereafter
created as the City Council shall determine.The bonds shall be
issued in such series;shall be in denominations and form;shall
bear such date or dates and interest rates or rates;shall be pay-
able at such place or places;shall mature serially in accordance
ORD.1039 -3 -
with such schedule,beginning not earlier than one year after date
of issuance and ending not later than forty (40)years thereafter
or shall be term bonds;shall have such option of payment prior to
maturity;shall guarantee such coverage and collection of rates;
shall provide for such additional funds and accounts;and shall
contain and be subject to such provisions or covenants as shall be
hereafter provided by ordinance.
Section 3.As used in this ordinance,the following
words shall have the following meanings:
(a)"Annual Debt Service"for any calendar year shall
mean all of the principal and interest due on the Bonds and any
Future Parity Bonds in such years except the principal of such
bonds due in any Term Bond Maturity Year of any issue having Term
Bonds,and plus all mandatory redemption or sinking fund require-
ments for the Term Bonds,which requirements will mature or become
due in such year,less all capitalized interest payable from the
proceeds of such bonds.
(b)"Assessments"shall mean all assessments levied in
any utility local improvement district of the City heretofore or
hereafter created for the acquisition or construction of additions
and improvements to and extensions of the System if such assess-
ments are pledged to be paid into the Revenue Bond Fund,including
any installments of assessments and any interest or penalties which
may be due thereon.
and Sewer Reven
eo do dssha19181mean t ehe$9 5,0 Oss dr v 1rseua
t
"Wataen
for the purposes provided for in this ordinance.
(d)"City"shall mean the City of Moses Lake,Washington,
a municipal corporation duly organized and existing under and by
virtue of the laws of the State of Washington.
ORD.1039 -4 -
8 (e)"Costs of Maintenance and Operation"shall mean all
necessary operating expenses,current maintenance expenses,expenses
of reasonable upkeep and repairs and insurance and administrative
expense,but excludes depreciation,payments for debt service or
into reserve accounts,costs of capital additions to or replacements
of the System,municipal taxes or payments to the City in lieu of
taxes.
(f)"Future Parity Bonds"shall mean any water and sewer
revenue bonds which the City may hereafter issue having a lien upon
the Revenue of the System and Assessments for the payment of the
principal thereof and interest thereon equal to the lien upon the
Revenue of the System and Assessments for the Bonds.
8 (g)"Maximum Annual Debt Service"shall mean the maximum
amount of Annual Debt Service which will become due in any future
year on outstanding Bonds and/or Future Parity Bonds.
(h)"Net Revenue"shall mean the Revenue of the System
less the Costs of Maintenance and Operation.
(i)"Plan of Additions and Betterments"shall mean the
system or plan for making additions to and betterments and exten-
sions of the System specified,adopted and ordered to be carried
out by Ordinance No.999,as herein amended.
(j)"Prior Lien Bonds"shall mean the "Water and Sewer
Revenue Bonds,Series A,"dated November 1,1955,the "Water and
Sewer Revenue Bonds,1965,"dated July 1,1965,the "Water and
SenwesewReve eve endBon19671 7datedaNovember 1,19767,and the "Water
(k)"Revenue Bond Fund"shall mean that special fund of
the City designated the "Water and Sewer Revenue Bond Fund,1981,"
created by this ordinance in the office of the City Treasurer for
ORD.1039 -5 -
$the purpose of paying and securing the principal of and interest
on the Bonds and any Parity Bonds.
(1)"Revenue Fund"shall mean the Water and Sewer
Revenue Fund of the City created by Ordinance No.135 of the City.
(m)"Revenue of the System"shall mean all earnings,
revenues and moneys received by the City from or on account of
the operation of the System,including the income from investments
of money in the Revenue Fund,the Revenue Bond Fund and the Con-
struction Fund or from any other investment thereof,including any
federal or state reimbursements of operating expenses to the extent
such expenses are included as Costs of Maintenance and Operation,
but not including grants for capital purposes.
(n)"System"shall mean the existing sanitary sewage
collection and treatment system of the City,including facilities
for the collection and disposal of storm water runoff,as it now
exists and as it may later be added to,extended and improved,and
the existing water supply and distribution system of the City,as
it may later be added to,extended and improved,for as long as the
Bonds remain outstanding.
(o)"Term Bond Maturity Year"shall mean any calendar
year in which maturing bonds of a particular issue are Term Bonds.
(p)"Term Bonds"shall mean any Bonds and/or Future
Parity Bonds identified as such in the ordinance authorizing the
issuance thereof,the payment of which is provided for by a re-
n
er e tA oumand tn thedeR
ue
BonmoFeu
d n
acheeor arninci al aand
mandatory sinking fund requirement.
(q)"U.L.I.D."shall mean Utility Local Improvement
District.
ORD.1039 .g -
8 Section 4.For the purpose of providing the funds with
which to carry out the Plans of Additions and Betterments as
applicable to U.L.I.D.s Nos.1 and 2 heretofore created,there
shall be issued and sold $985,000 par value of the Bonds (by this
ordinance designated and defined as the "Water and Sewer Revenue
Bonds,1981").The Bonds shall be dated December 1,1981,and
shall bear interest from such date payable on July 1,1982,and
semiannually thereafter on each succeeding January 1 and July 1,
interest to maturity to be evidenced by coupons to be attached to
the Bonds.If any Bond is not redeemed when duly presented at its
maturity or call date thereof,the City shall be obligated to pay
a
rr a ha lcouapon f chea hndsucbh Bo rc paandandaf en
e t,
shall have been paid in full or until sufficient money for such
payment in full is on deposit in the Revenue Bond Fund and such
Bond has been duly called for payment.The Bonds shall be in
denominations of $5,000 each,shall be numbered from 1 to 197,
inclusive,and shall bear interest and mature on July 1 of each
year in accordance with the following schedule:
Bond Numbers Interest Maturity(Inclusive)Amounts Rates Years
1 to 2 $10,000 10%19822to515,000 10.50 19836to920,000 11.0 198410to1320,000 11.25 198514to1720,000 11.50 198618to2225,000 11.75 1987823to28:03,000 12.00 198829to3430,000 12.25 198935to4135,000 12.50 199042to4940,000 12.75 1991(herein called "Serial Bonds")
***50 to 197 740,000 13.75 2001(herein called "Term Bonds")
oRD.1039 -7 -
able in
lawBoth prienycipal
h
Uan intSe ea eson t mes nda atshall be ay-
of the Treasurer of the City or,at the option of the holder,at
either fiscal agency of the State of Washington in Seattle,Wash-
ington,or New York,New York.The Bonds shall be payable solely
from the Revenue Bond Fund.The Bonds shall be a valid claim of
the holder thereof only as against the Revenue Bond Fund and the
fixed amount of the Revenue of the System and Assessments (includ-
ing assessments in U.L.I.D.s Nos.1 and 2 heretofore created)
pledged to such fund,and shall not be a general obligation of the
City.
Section 5.The Serial Bonds numbered 1 through 49,
inclusive,shall be issued without the right or option of the City
8 to call the same for redemption prior to their respective maturity
dates.
The City reserves the right to redeem prior to their
stated maturity dates the Term Bonds numbered 50 to 197,inclusive
maturing July 1,2001,in whole or in part in inverse numerical
order,on July 1,1991,or on any semiannual interest payment date
thereafter,at the following percentages of par if called on the
following dates,plus accrued interest to date of redemption:
Call Dates Call Price
July 1,1991,and January 1,1992 103.00%July 1,1992,and January 1,1993 102.50%July 1,1993,and January 1,1994 102.00%July 1,1994,and January 1,1995 101.50%July 1,1995,and January 1,1996 101.00%July 1,1996,and January 1,1997 100.50%
$July 1,1997,and thereafter 100.00%
In addition,tne City shall call for prior redemption by
lot any Term Bonds numbered 50 to 197,inclusive,not previously
called under the foregoing optional call provisions from funds
deposited in the Revenue Bond Fund in the amounts and on July 1 of
ORD,1232 -B -
each of the years in accordance with the Mandatory Sinking Fund
Requirement as set forth in Section 7 hereof.
Notice of any call for the redemption of any of the Term
Bonds prior to their maturity date shall be published once in the
official newspaper of the City,or,if there is no official news-
paper,then in a newspaper of general circulation in the City,not
less than 30 nor more than 45 days prior to the interest coupon due
date on which the Bonds would be redeemed.Notice of such call for
redemption shall also be mailed to Seattle-Northwest Securities
Corporation at their principal places of business in Seattle,
Washington,or its successor,not less than 30 nor more than 45
days prior to the interest coupon due date upon which the Bonds
would be redeemed.In addition,such redemption notices shall be
i mailed to Moody's Investors Service,Inc.,and Standard &Poor's
Corporation at their offices in New York,New York,but the mailing
of such notices shall not be a condition precedent to any such
redemption.Interest on any Term Bonds so called for redemption
shall cease on such interest coupon due date upon payment of the
call price into the Bond Fund.
The City further reserves the right to purchase any or
all of the Bonds in the open market at any time at a price not in
excess of par plus accrued interest to the date of such purchase.
Section 6.Pursuant to Section 7 of Ordinance No.135,
the Revenue Fund was created into which all gross earnings and
revenue of the System must be paid and collected.All Costs of
8 Maintenance and Operation of the System,all charges for the pay-
ment of the principal of and interest on the outstanding Prior Lien
Bonds,all costs of additions,improvements,betterments and re-
pairs to and replacements and extensions of the System (except when
the same are financed by the issuance of bonds,coupon warrants,or
ORD.1039 -9 -
warrants drawn on other special funds of the City),all payments
required to be made into any fund or funds for the payment of or
reserve for the Prior Lien Bonds,and all payments which may be
required by any ordinances of the City passed subsequent to Ordi-
nance No.135 to be made into any bond redemption fund and/or
reserve fund or account created for the purpose of paying or guar-
anteeing the payment of the principal of and interest on any water
and sewer revenue bonds or coupon warrants of the City issued subse-
quent to such Ordinance No.135 must be paid out of the Revenue
Fund.Money in such fund shall be used only for the purposes and
in the order of priority as more particularly set forth in Section
10 hereof.
Section 7.There is created and established in the
office of the City Treasurer a special fund of the City to be known
as the "Water and Sewer Revenue Bond Fund,1981"(herein defined as
the "Revenue Bond Fund"),which fund shall be drawn upon for the
sole purpose of paying the principal of and interest on the Bonds
and any Future Parity Bonds hereafter issued in accordance with
the provisions of Section 9 of this ordinance.The Bond Fund is
divided into two accounts,namely a "Principal and Interest Account"
and a "Reserve Account."So long as any Bonds are outstanding
against the Revenue Bond Fund,the City irrevocably binds and
obligates itself to set aside and pay into the Revenue Bond Fund
all Assessments paid in U.L.I.D.s Nos.1 and 2 and,out of the
Revenue of the System deposited in the Revenue Fund,certain fixed
nne
a
ahn
Int r
dt
A
coa ynt ne hproporn en,dnamely,e
h
mohn
h,
an amount,together with Assessments paid into the Revenue Bond
Fund,at least equal to one-seventh of the amount of interest
payable on July 1,1982,and thereafter one-sixth (1/6)of the
interest to become due and payable on the next interest payment
ORD.1039 -10 -
date,and an amount equal to at least one-thirteenth of the amount
i of principal payable on July 1,1982,and thereafter one-twelfth
(1/12)of the principal of the Bonds to become due and payable on
the next principal payment date,and on or before July 1 of each
year commencing with the month of July,1991,1/12th of the respec-
tive amounts to be deposited therein by July 1 in each of the
following years:
July 1 Amount
1992 $45,000
1993 45,000
1994 50,000
1995 55,000
1996 65,000199775,000
1998 85,000199995,0002000105,0002001120,000
8 (herein called the "Mandatory Sinking Fund Requîrement"),and such
amounts so deposited into the Principal and Interest Account shall
be used to call and retire Term Bonds in accordance with the
provisions of Section 5 hereof.
There shall be deposited into the Reserve Account immedi-
ately all Assessments heretofore paid in U.L.I.D.s Nos.1 and 2
and,from the Revenue of the System deposited in the Revenue Fund
and Assessments hereafter paid into the Revenue Bond Fund,the City
will pay into such Reserve Account annually in five approximately
equal payments such amounts,the total of which,together with
other money on deposit in such Reserve Account,will be at least
equal to the Maximum Annual Debt Service due thereafter on all
Bonds payabThee
Reser e
hAeccRevenuehaBondbe
ma ntained in the total
required reserve amount for the Bonds,except for withdrawals
therefrom as authorized herein,at all times so long as any of the
Bonds is outstanding,PROVIDED,that when the total amount in the
Bond Fund shall equal the total amount of principal and interest
ORD.1039 -11 -
$for all outstanding bonds payable out of the Bond Fund to the last
maturity thereof,no further payment need be made into the Bond
Fund,and PROVIDED,FURTHER,that the amount in such Reserve
Account may be reduced at any time to an amount not less than the
Maximum Annual Debt Service requirements for all bonds payable out
of the Revenue Bond Fund then outstanding.
In the event that there shall be a deficiency in the
Principal and Interest Account in the Bond Fund to meet maturing
installments of either principal or interest,as the case may be,
such deficiency shall be made up from the Reserve Account by the
withdrawal of cash therefrom for that purpose.Any deficiency
created in the Reserve Account by reason of any such withdrawal
i shall then be made up from the Revenue of the System deposited in
the Revenue Fund and/or Assessments payable into the Revenue Bond
Fund first available after making necessary provision for the
required payments into the Principal and Interest Account.The
money in the Reserve Account shall otherwise be held intact and may
be applied against the last outstanding bonds payable out of the
Revenue Bond Fund.
All money in the Revenue Bond Fund may be kept on deposit
in the official bank depository of the City or in any national bank
or may be invested and reinvested in United States Government obli-
gations or any other legal investment redeemable at a fixed price
and maturing no later than one month prior to the next mandatory
ndad try
a
lb ndsapp ea
e
omandmatnory rr dermpti
he in maturity
date of the last outstanding bonds payable out of the Revenue Bond
Fund.Interest earned on any such investment or on such bank
deposit shall become a part of the Revenue of the System and need
not be deposited in the Bond Fund,except that interest earned on
any investment of money in the Principal and Interest Account for
ORD.1039 -12 -
bonds having a mandatory call provision shall be retained in the
i Principal and Interest Account and used to call and redeem such
bonds.
If the City shall fail to set aside and pay into the
Revenue Bond Fund the amounts which it has obligated itself by this
section to set aside and pay therein,the holder of any Bond may
bring suit against the City to compel it to do so.
The City Council and corporate authorities of the City
hereby declare that in fixing the amounts to be paid into the Bond
Fund they have considered and had due regard for Costs of Mainte-
nance and Operation of the System and have not set aside into the
Revenue Bond Fund a greater amount or proportion of the Revenue of
the System than in their judgment will be available over and above
i the Costs of Maintenance and Operation of the System and the debt
service and reserve requirements for the presently outstanding
Prior Lien Bonds.
Section 8.All Assessments in U.L.I.D.s Nos.1 and 2
and all Revenue of the System are hereby pledged to the payments
required to be made into the Revenue Bond Fund,and the Bonds shall
constitute a charge and lien upon such Assessments and Revenue
prior and superior to all other charges and liens whatsoever,
excluding the Costs of Maintenance and Operation of such System
payable out of such Revenue,EXCEPT that the charge and lien upon
such Revenue alone for the Bonds shall be junior to the charge and
lien upon such Revenue alone for the outstanding Prior Lien Bonds
and shall be on a parity with the charge and lien upon such Revenue
and Assessments for any Future Parity Bonds.
Section 9.The City covenants with the owner and holder
of each of the Bonds as follows:
(a)It will at all times maintain and keep theSystemoftheCityandalladditionsandimprove-ments thereto in good repair,working order andcondition,and will at all times operate such
ORD.1039 -13 -
utility and the business in connection therewith8inanefficientmannerandatareasonablecost.
-(b)In addition to the coverage requirementsfortheoutstandingPriorLienBonds,it will fix,maintain and collect rates and charges for theuseoftheservicesandfacilitiesandallcommod-ities sold,furnished or supplied by the System toensuretnattheRevenueoftheSystem,togetherwithanyAssessments,is sufficient to pay allCostsofMaintenanceandOperationanddebtserv-ice on the Bonds,as well as any other amountsthattheCityisobligatedtopayfromtheRevenueoftheSystem,and that the Net Revenues togetherwithAssessmentsineachcalendaryearwillequalatleast1.25 times Maximum Annual Debt Service.
(c)It will not sell,lease,mortgage or in anymannerencumberordisposeofallthepropertyoftheSystemunlessprovisionismadeforpaymentintotheRevenueBondFundofasumsufficienttopaytheprincipalofandinterestonallbondspayableoutoftheBondFundatanytimeoutstand-ing,and it will not sell,lease,mortgage or in
any manner encumber or dispose of any part of the8propertyofsuchSystemthatisused,useful andmaterialtotheoperationthereof,unless provi-sion is made for replacement thereof,or for pay-ment into the Revenue Bond Fund of the total amountofRevenuereceivedwhichshallnotbelessthananamountwhichshallbearthesameratiototheamountofoutstandingbondspayableoutoftheRevenueBondFundastheRevenueavailablefordebtserviceforsuchoutstandingbondsforthetwelvemonthsprecedingsuchsale,lease,encumbrance ordisposalfromtheportionoftheutilitysold,leased,encumbered or disposed of bears to theRevenueavailablefordebtserviceforsuchbondsfromtheentireutilityforthesameperiod.AnysuchmoneysopaidintotheRevenueBondFundshallbeusedtoretiresuchoutstandingbondsattheearliestpossibledate.
(d)It will,while any of the Bonds remainsoutstanding,keep proper and separate accounts andrecordsinwhichcompleteandseparateentriesshallbemadeofalltransactionsrelatingtoitsSystem,and it will furnish any subsequent holder
or holders of the Bonds,if the Bonds shall beownedbyotherthanafundoftheCity,at theiwrittenrequestofsuchholderorholders,completeoperatingandincomestatementsofsuchutilityinreasonabledetailcoveringanycalendaryear,showing the financial condition of the water andsewerdepartmentsandcompliancewiththetermsandconditionsofthisordinance,not more than120daysafterthecloseofsuchcalendaryear,and it will grant any holder or holders of atleast25%of the outstanding Bonds the right atallreasonabletimetoinspecttheentireSystemandallrecords,accounts and data of the City
ORD.1039 -14 -
$relating thereto.Upon request of any holder of
any of such Bonds,it will also furnish to suchholderacopyofthemostrecentlycompletedauditoftheCity's accounts by the State Auditor ofWashingtonorsuchotherauditasisauthorized bylawinlieuthereof.
(e)It will not furnish water or sanitary
sewage disposal to any customer whatsoever freeofchargeandwillpromptlytakelegalaction toenforcecollectionofalldelinquentaccounts.
(f)It will promptly collect all outstandingAssessmentsandpaythesameintotheRevenue BondFund.
(g)It will carry the types of insurance on thepropertiesoftheSystemintheamountsnormallycarriedbyprivatewaterandsewercompaniesengagedintheoperationofwaterandseweragesystems,and the cost of such insurance shall beconsideredapartoftheCostsofMaintenanceandOperation.If,as and when the United States ofAmericaorsomeagencythereofshallprovidefor8WarRiskInsurance,the City further agrees totakeoutandmaintainsuchinsuranceonallorsuchportionsofsuchUtilityonwhichsuchWarRiskInsurancemaybewritteninanamountoramountstocoveradequatelythevaluethereof.
(h)It will pay all Costs of Maintenance andOperationandotherwisemeettheobligationsoftheCityashereinsetforth.
(i)It will not create any special fund orfundsforthepaymentofotherrevenuebonds,war-rants or obligations,or authorize or issue anyotherrevenuebonds,warrants or obligations whichwillrankonaparitywithorhaveanypriority
over the payments into or the money in the RevenueBondFund,except that it hereby reserves therightfor:
(1)The purpose of acquiring,constructingandinstallingadditionsandimprovementsto andextensionsandbettermentsof,acquiring necessaryequipmentforormakingnecessaryreplacementsofequipmentorcapitalimprovementstotheSystemoftheCity;or8(2)The purpose of exchanging or purchasingandretiringpriortoorattheirmaturityanyoutstandingwaterandsewerrevenuebondsoftheCity;
to issue additional and/or refunding water andsewerrevenuebonds(herein defined as "FutureParityBonds")and to make payments into theRevenueBondFundforthepaymentofsuchFuture
ORD.1039 -15 -
Parity Bonds from the Revenue of the SystemdepositedintheRevenueFund,together withAssessmentscollectedinanyU.L.I.D.createdinconnectionwiththeissuanceofsuchFutureParityBondssufficienttopaytheprincipal ofandinterestonsuchFutureParityBonds,whichsuchpaymentsmayrankequallyoutofsuchRevenueoftheSystemandAssessmentscollectedinU.L.I.D.Nos.1 and 2 if the City complieswiththefollowingconditions:
(1)All payments required by any ordinanceoftheCitypertainingtooutstandingwaterandsewerrevenuebondsoftheCityshallhavebeenmadeintotherespectivebondredemptionfundsforthepaymentofsuchwaterandsewerrevenuebondsandnodeficiencyexiststherein;
(2)If one or more U.L.I.D.s shall becreatedinconnectionwiththeissuanceof suchFutureParityBonds,the ordinance providingfortheissuanceofsuchFutureParityBondsshallprovidethatallofsuchAssessmentsshallbepaiddirectlyintotheRevenueBondFund.
(3)Any ordinance authorizing Future ParityBondsshallrequirethattheReserveAccountbeincreasedwithinaperiodfiveyearsafterthedateofissuanceofsuchFutureParityBondstoanamountequaltotheMaximumAnnualDebtService.
(4)At the time that Future Parity Bonds
are issued,the City shall have on file a cer-tificate from an independent licensed profes-sional engineer or certified public accountantshowingthatinhisprofessionalopiniontheNetRevenueinanytwelveconsecutivemonthsoutofthetwenty-four months directly precedingtheissuanceofsuchParityBondstogetherwithAssessmentsequalsatleast1.25 times AnnualDebtService.The determination of coverageforparitypurposesdependsuponthefollowingprovisions:
In determining whether the City complieswiththeparityconditions,the following adjust-ments may be made to the historical Net Revenue:
a.any rate change that has taken place orbeenapprovedmaybereflected;
b.revenue may be added from customersactuallyaddedtotheSystemduring orsubsequenttothe12-month base period;
c.actual or reasonable anticipated changesintheCostsofMaintenanceandOperationsubsequenttothe12-month base periodshallbeaddedordeducted,as applicable
ORD.1039 -16 -
$d.revenue may be added from customers to beservedbytheimprovementsbeingcon-structed out of the proceeds of the bondstobeissued;
e.a full year's revenue may be includedfromanycustomersbeingserved,but whohavenotbeenreceivingserviceforthefullperiodofoperationusedasabasisforthecertificate.
Nothing contained in this ordinance shall pre-vent the City from issuing revenue bonds orwarrantswhichareachargeupontheRevenue oftheSystemjuniororinferiortothepaymentsrequiredtobemadetherefromintotheRevenueBondFundandtheReserveAccountthereinorfrompledgingthepaymentofU.L.I.D.assessments intothebondredemptionfundcreatedforthepaymentoftheprincipalofandinterestonsuchjuniorlienbondsaslongassuchassessmentsareleviedforimprovementsconstructedfromtheproceedsofsuchjuniorlienbonds.
Nothing herein contained shall prevent the CityfromrefundingallorpartoftheBondsinaccord-8 ance with the provisions of the Refunding Bond ActoftheStateofWashington(Chapter 39.53 RCW)asthesamemaybeamended,and it is hereby expresslyprovidedthatanysuchrefundingbondesoissuedshallhavethesamelienupontheRevenueoftheSystemandAssessmentsastheBondsbeingrefunded.
The right of the City to issue any additionalPriorLienBondsinaccordancewiththeprovisionsofSection14ofOrdinanceNo.290 is hereby can-celled and terminated.
(h)It will make no use of the proceeds of theBondsorotherfundsoftheCityatanytimeduringthetermoftheBondswhichwillcausesuchBondstobearbitragebondswithinthemeaningofSection103(c)of the United States InternalRevenueCodeof1954,as amended,and applicableregulationsthereunder.
Section 10.Money in the Revenue Fund shall be used for
the following purposes only and in the following order of priority:
First:to pay the Costs of Maintenance andOperationoftheSystem;
Second:to pay the interest on Prior Lien Bonds;
Third:to pay the principal of Prior Lien Bonds;
Fourth:to make all payments required to be madeintotheReserveAccountcreatedtosecurethepaymentofthePriorLienBonds;
ORD.1 39 -17 -
Fifth:to pay the interest on the Bonds and anyiFutureParityBonds;
Sixth:to pay the principal of the Bonds andanyFutureParityBonds;
Seventh:to make all payments required to be madeintotheRevenueBondFundforthepay-men of the principal of the Bonds andanyFutureParityBondswhichareTermBonds;
Eighth:to make all payments required to be madeintotheReserveAccountintheRevenueBondFundcreatedtosecurethepaymentoftheBondsandanyFutureParityBonds;
Ninth:to make all payments required to be madeintoanyrevenuebondredemptionfundorwarrantredemptionfundanddebtserviceaccountorreserveaccountcreatedtopayandsecurethepaymentoftheprin-cipal of and interest on any revenuebondsorrevenuewarrantsoftheCityhavingalienupontherevenueofthe
i System junior and inferior to the lienthereonforthepaymentoftheprincipalofandinterestontheBondsandFutureParityBonds;
Tenth:to retire by redemption or purchase intheopenmarketanyoutstandingrevenuebondsorrevenuewarrantsoftheCity,to make necessary additions,betterments,improvements and repaire to or extensionsandreplacementoftheSystem,or foranyotherlawfulCitypurposes.
Section 11.In the event the City shall issue advance
refunding bonds pursuant to the laws of the State of Washington,
or have money available from any other lawful source,to pay the
principal of and interest on the Bonds or such portion thereof
included in the refunding plan as the same become due and payable
and to refund such then outstanding Bonds and to pay the costs
of refunding,and shall have irrevocably set aside for and pledged
to such payment and refunding,money and/or direct obligations of
the United States of America or other legal investments sufficient
in amount,together with known earned income from the investment
thereof,to make such payments and to accomplish the refunding as
ORD.1039 -18 -
hr voceabl(herekin alled trhere
emp
oaccou tuch Bndadshat
en in
that case all right and interest of the owners or holders of the
Bonds to be so retired or refunded and the appurtenant coupons
(hereinafter collectively called the "defeased Bonds")in the cove-
nants of this ordinance,in the Revenue of the System,funds and
accounts,including Assessments,obligated to the payment of such
Bonds shall thereafter cease and become void,except such owners
and holders shall have the right to receive payment of the principal
of and interest on the defeased Bonds from the trust account and,
in the event the funds in the trust account are not available for
such payment,shall have the residual right to receive payment of
the principal of and interest on the defeased Bonds from the
i Revenue of the System and Assessments without any priority of lien
or charge against that Revenue and Assessments or covenants with
respect thereto except to be paid therefrom.After the establishing
and full funding of such trust account,the City may then apply any
money in any other fund or account established for the payment or
redemption of the defeased Bonds to any lawful purposes as it shall
determine,subject only to the rights of the holders of any other
bonds then outstanding.
In the event that the refunding plan provides that the
Bonds being refunded or the refunding bonds to be issued be secured
by cash and/or direct obligations of the United States of America
or other legal investments pending the prior redemption of those
Bonds being refunded and if such refunding plan also provides that
certain cash and/or direct obligations of the United States of
America or other legal investments are irrevocably pledged for the
prior redemption of those Bonds included in the refunding plan,
then only the debt service on the Bonds which are not defeased Bonds
DED.1039 -19 -
tah re re ungnd ganbondsa'lthb
c
euded nwhiecho
p at
onsecuro dve
age
for issuance of Future Parity Bonds and the annual computation of
coverage for determining compliance with the rate covenants.
Section 12.The Bonds shall be in a form consistent
with this ordinance,shall be printed or lithographed on good bond
paper,and shall be signed by the facsimile signature of the Mayor,
attested by the manual signature of its City Clerk,shall have a
facsimile reproduction of the seal of the City imprinted thereon,
and the interest coupons attached thereto shall bear the facsimile
signatures of the Mayor and the City Clerk.
Section 13.Seattle-Northwest Securities Corporation of
Seattle,Washington,has submitted an offer to purchase the Bonds
i at a price of S 96.50 per each $100 of par plus accrued interest
to the date of delivery of the Bonds,the City to furnish the
unqualified approving legal opinion of Roberts &Shefelman (Roberts,
Shefelman,Lawrence,Gay &Moch),municipal bond counsel of Seattle,
Washington,covering the Bonds,which opinion shall state that bond
counsel has not reviewed,and thus expresses no opinion concerning,
the completeness or accuracy of any official statement,offering
circular or other sales material relating to the issuance of the
Bonds or otherwise used in bonnection with the Bonds.The City
Council,being of the opinion that it is in the best interests
of the City to accept such offer,hereby accepts the same.The
Bonds shall immediately upon their execution be delivered to the
purchasers upon payment for the Bonds in accordance with such
offer.The accrued interest received shall be deposited in the
Revenue Bond Fund and the principal proceeds received shall be
deposited in the "Water and Sewer Construction Fund,1981,"created
by Ordinance No.999 (the "Construction Fund").Pending the
ORD.1039 -20 -
exp n itureand
B
her
e s
cprpr
c
edinmcarrye
nv
steth
n a
yn of
legal investment and the investment income received may he retaiÉed
in the Construction Fund and expended for the purposes of such
Fund.
Section 14.This ordinance shall take effect and be in
force five days after its passage,approval and legal publication.
PASSED by the City Council of the City of Moses Lake,
Washington,at a regular open public meeting thereof and APPROVED
by the Mayor this 24th day of November,1981.
CITY OF MOSES LAKE,WASHINGTON
/Mayor Pro Tem
ATTEST:
City Cler
FORM APPROVED:
C y Attorneý*
Publish:November 27,1981
B
TBD.1039 -21 -