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HomeMy WebLinkAbout2011-06-27 11-222 ORDERRem No, � ' 2 2 2 all Rune 27 2011 Item/Subject: ORDER, AUTHORIZING THE ISSUANCE OF $7,00,000 AGGREGATE PRINCIPAL AMOUNT OF QUALIFIED SCHOOL CONSTRUCTION BONDS. Responsible Deparbnent: Finance Earlier this year, the School Department was awarded up fo $7,0010,000 low interest loan Grogram offered by State Departmentof Education for renovation of schools. The Iwn program is a Qualified School Construction Bond program (QSCB). This funding was made available on a mmpetil basis throughoutthe State. The projects submitted by the School Department included the replacement of aging HVAC equipment, an" roof at Bangor High, replacement ofthe bleachers at Bangor High, repair/replacement of ventilation systems, as well as some lighting upgrades. The QSCB, is a federally sponsored/funded program with Flexible repayment terms. Through this program the City would be able to set its principal repayment schedule to match the annual reductions in our current debt, liberally not increasing our annual debt service level and receive reimbursement for nearly 100% of the interest costs resulting in a neatly interest free loan. The attached Order would allow the issuance of the Qualified School Construction Bonds to undertake the aforementioned projects. /'D pot Head Manager's Canonica : This item will require a public heading on July 11, 2011. City Manager Associated Information 1044 InanY C2 bfrf Of Legal APProvan City Sclidtor Passage X First Reading— Finance Committee oflune 27, M11 Pallial Referral lune 27, 2011 ASelgned Co CoumilOi - Realley Gwm CITY OF BANGOR (TITLE.) ORDER, AUTHORIZING THE ISSUANCE OF $7,000,000 AGGREGATE PRINCIPAL AMOUNT OF QUALIFIED SCHOOL CONSTRUCTION BONDS. BE R ORDERED BY THE CITY COUNCIL Of THE CITY OF BANGOR, THAT under and pursuant W sections 54A and W of the Internal Revenue Code of 1986, as amended (the "Code"), 30-A M.R.S.A. §5A2, Section 13 of Article W of the City Charter (Private and Special taws of 1931, Chapter 54) and all amendments thereof and acts additional thereto, and all other autlwrity thereto enabling, there is hereby authorized the issue and sale at one time and from time to time up to Seven Million Dollars ($7,000,000) aggregate Principal amount of general obligation bonds of the City of Bangor, The proceeds derived from the sale of said bonds, including premium, if any, and Investment earnings thereon, shall be used and are hereby appropriated to pay a portion of the costs (as herein defined) to finance We rehabilitation, reconstruction, repair, upgrading and equipping of school facilities at the following schools (the "Rroject': • Abraham Lincoln School • Bangor High School • Downeast School • Fairmount School • Fourteenth Street School • Fruit Street School • lames F. Doughty Middle School • Mary Snow School • Vine Street School • William Cohen Middle School THAT the estimated weighted average period of utility for the property constituting the Project to be financed with the proceeds of said bonds is hereby determined to be not less than 15 years. THAT the date, maturities (not W exceed the maximum term permitted by law), denominations, interest rate or rates, place of payment and other details of each issue of said bonds, including the timing and Provision for their sale and award and the selection of an t! x7:22 underwriter, shall be determined by the Finance Diredor with the approval of the Finance Committee. THAT one bonds hereby authorized may be made subject to call for redemption, warn or without a premium, before the date fixed for final payment of the bonds, As providetl in 30-A M.R.S.A. 45772(6), as amended, as shall be determined by the Finance Director wkh the approval of the Finance Committee. THAT said bonds shall be signed by the Finance Director, countersigned by the Chairman of the City Council, sealed with the seal of the City, attested by its Clerk, and shall be in such form and contain such terms and provisions not inconsistent herewith as they may approve, their approval to be conclusively evidenced by their execution thereof. Any issue of bonds may be consolidated with and issued M the same time as any other issue of bonds authorized prior to their issuance, and the bonds may be divided into multiple series and Issued in separate plans of financing, with the approval of the Finance Committee and the Chairman of the City Council. THAT pursuant to 30-A MRSA. 45772, Section 15 of Article Vf of the City Charter and any other authority therein enabling, the Finance Director, with approval of Me Finance Committee and the Chairman of the City Council, is hereby authorized to issue notes of the City in anticipation of the forgoing bend issue, said notes to be signed! by To Finance Director, countersigned by the Chairman of the City Council, sealed with the seal of the City, attested by Its Clerk, and otherwise to be in such form and contain such terms and provisions including, without limitation, maturities (not to exceed 3 years from the issue canal, denominations, interest rate or rates, place of payment, and other details as they shall approve, their approval to be contumely evidenced by their execution thereof. THAT the bons and any notes of the City issued in anticipation thereof be designated as a qualified school conshvcdon bon pursuant to Section 54F of the Code and that S don 6431 of the Cade apply to such bonds and notes in anticipation thereof. THAT any bonds or notes (including bonds or notes in renewal thereof) authorized to be issued under this Order may be Issued in combination with bonds or notes (including bonds or notes In renewal thereof) authorized to be Issued by the City Council at any time prior to the date a issuance of such bonds or notes. THAT the Finance Director be and hereby is authorized to select the regisbar, paying agent, and transfer agent (the "Transfer Agent) for the bonds an notes and to execute and deliver such contracts and agreements as may be necessary or appropriate to secure their services. THAT the bonds and nota shall be transferable only on the registration books of the City kept by are Transfer Agent in minimum denominations approved by the Finance Director, and said pdndpal amount of the bonds and nota of the same maturity (but not of other maturity), upon surrender thereof at the prindpal office of the Transfer Agent, with a written instrument of transfer satisfactory to the Transfer Agent duly executed by the registered owner or his or her Attorney, duly authorized In writing. THAT In lieu of physical certificates "e bonds and notes herembefore authorized, the Finance Director be and hereby is authorized to undertake all ads necessary to provide for the Issuance and transfer of such bonds and notes in book -entry farm pursuant to the Depository Truk Company hook -Entry Only System, as an alternative to the provisions of the foregoing paragraph regarding physical transfer of bonds, and the Finance Director be and bereby is authorized and empowered to enter into a Letter of Representation or any other contract, agreement or understanding necessary or, in his opinion, appropriate In order to qualify the bonds for and participate in the Depository Trust Company Book -Bray Only System; THAT the Finance Director and Chairman of the City Council from time to time shall execute such bonds or notes as may be requiretl to provide for exchanges or transfers of bonds or notes as heretofore authorized, all such bonds or notes to bear the original signature of the Finance Director and Chairman of the City Council, and in case any officer of the Clry whose signature appears on any bond or note shall cease to be such officer before the deliver of said bond or note, such signature shall nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in office until delivery thereof. THAT upon each exchange or transfer of bonds or notes, the City and transfer agent shall make a charge suffiaent to cover any tax, fee, or other govemmental charge required to be paid with respect to such transfer or exchange, and subsequent to the first exchange or transfer, the cost of which shall be borne by the City, the cost of preparing new bonds or notes upon exchanges or transfers thereof shall be paid by the person requesting the same. THAT the bonds and nates Issued in antapation thereof be issued an either a taxable or a tax-exempt basis, or a combination thereof, as determined by the Finance Director, with the approval of the finance Committee. THAT the officers executing such bonds or notes be and hereby are individually authorized and directed to covenant and certify on behalf of the City that no part of the proceeds of the issue and sale of the bonds or notes authorized to be issued hereunder shall be used directly or indirectly th acquire any securities or obligations, the acquisition of which would cause such bands or notes to be "arbitrage bonds' within the meaning of Section 143 of the Internal Revenue Code of 1936, as amended (the "Code"). THAT the officers executing such bonds or rotes be and hereby are individually authorized to covenant and agree, on behalf of the City, for the benefit of the holders of such bonds or notes, that the City will file any required reports and take any other action that may be necessary to ensure that Interest on the bonds or notes will remain exempt from federal income taxation and that the City will refrain from any action that would cause interest on the bonds or notes m be subject to federal Income taxation. THAT the officers executing the bonds or notes be and hereby are individually authorized th covenant, certify, and agree, on behalf of the City, for the benefit of the holders of such bonds or notes, that the City will file any required reports, make any annual financial or material event disclosure, and take any other action that may be necessary to ensure that the disdosure requirements Imposed by Rule 15c2-12 of the Securities and Exchange Commission, if applicable, are met. THAT, if the bonds or notes in ardcipaton thereof, or any part of them, are issued on a tax exempt basis, the Finance Director be and hereby is authorized and empowered W take all such action as may be necessary m designate the bonds or notes as qualified tax-exempt obligations for purposes of Section 265(b) of the Code; it being the City Council's intention that, W the extent permitted and advisable under the Code, the bonds or notes be Section 265(b) designated and that the Finance Director with advice of bond counsel, make the required Section 265(b) election with respect to such bonds to the extent that the election may be available and advisable as determined by the finance Director. THAT the term "cast" or "casts" as used herein and applied to the Project, or any portion thereof, includes, but is not limited to: (1) the purchase price or acquisition cost of all or any portion of the Project; (2) the cost of construction, building, alteration, enlargement, reconstruction, renovation, improvement, and equipping of the Project; (3) the cast of all appurtenances and other facilities either on, above, or under the ground which are used or usable in connection with the Project; (9) the cast of landscaping, site preparation, and remodeling of any Improvements or facilties; (5) the cast of all labor, materials, Wilding systems, machinery and equipment; (6) the cost of land, s[naNres, real property interests, rights, easements, and franchises acquired in connection with the Projed, (7) the cost of all utility extensions and site improvements and development; (8) the cost of planning, developing, preparation of specifications, surveys, engineering, feasibility studies, legal and other professional services associated with the Project; (9) the cost of environmental spdies and assessments; (10) the cost of financing charges and Issuance costs, including premiums for insurance, interest prior to and during construction and, following completion of construction, for a period not to exceed 3 years from the issue data thereof, underynters' fees and coos, legal and Ncwnbng fees and cask, application fees, and other fees and expenses relating to the financing transaction; and (11) the cost of all other financing authorized hereunder, whether relatetl or unrelated to the foregoing. THAT the Investment earnings on the proceeds of the bonds, If any, and the excess proceeds of the bonds, If any, be and hereby are appropriated for the following purposes, such proceeds to be held and applied in the following order of priority: 1. To any costs of the Project In excess of the principal amount of the bonds; 2. In accordance with applicable tens and provisions of the Arbitrage and Use of Proceeds Certificate delivered in connection with the sale of the bends or notes including, to the extent permitted thereunder, to the City's General Fund. THAT the finance Director, Chairman of the City Council, Clerk and other proper officials of the City be, and hereby are, authorized and empoweretl in its name and can ICs behalf to do or cause to be done all such acts and things as may be necessary or desirable in order to effect the issuance, sale, and delivery of the bonds and nates as hereinbefore autrorized. T11IIT if the Finance Director, Chairman of the City Council, or Clerk are for any reason unavailable to approve and execute the bonds or any related financing documents, the person or persons ten acting in any such capacity, whether as an assistant, a deputy, or otherwise, is authorized to act for such official with the same force and effect as If such official had himself or herself performed such act. THAT in each of are years during which any of the bonds are outstanding, there shall be levied a fax in an amount that. with other revenues, X any, available for that wrpose, shall be sufficient to pay the interest on said bonds, payable in such years, and the principal of such bobes maturing in such years. 1111106 11 m CITY COUNCIL Jme 27. 2011 Firg§t. Beading 6 Neferral to Finance Casyittee i sting 0£ 6/27/11 B IN "If CODDCIL July 11. 2011 Notion Made mud Seconded r0n pppp the Public Nearing. Also gochis, Director of Business. gaveau exploration of the Projects and urged council support. Notion Made and Seconded to Close the Public Hearing Public Deming Closed Motion Dade and Seconded fort Passage Passed , CITYCIYY Ci //W1"`2YN .710 Cf��� Y - 0®SR (riRE,) Aotfiorlafra the Ieeoanre of E].000.000 �agt of ffled School Con'truction Bonds B..yeea mcouwiw