Resolution 1981-64
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06/05/81.
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RESOLUTION NO. 81- 64
A RESOLUTION DETERMINING UNPAID ASSESSMENTS
AND PROVIDING FOR ISSUANCE OF BONDS
OBATA INDUSTRIAL PARK ASSESSMENT DISTRICT
RESOLVED, by the City Council (the "Council") of the City of
Gilroy, California (the "City"), that
WHEREAS, the Council has provided in proceedings conducted under
and pursuant to its Resolution of Intention No. 80-104, adopted
October 27, 1980, that serial bonds will be issued to represent the
unpaid assessments pursuant to the provisions of Bond Plan B, Division
3, Article III, Chapter 12A of the Gilroy City Code (the "Bond Law");
WHEREAS, a complete list of all unpaid assessments has been made
by the City Clerk as Collection Officer and filed with the City Director
of Finance (the "Director of Finance" >: and
WHEREAS, the Council has duly considered said list and has
determined that the same is an accurate statement thereof;
NOW, THEREFORE, THE COUNCIL HEREBY DETERMINES AND ORDERS, as
follows:
1. List of Unpaid Assessments. That the assessments now
remaining unpaid are as shown on said list and on Exhibit "A" attached
hereto and by this reference made a part hereof, that the aggregate
amount thereof is $2,209,494.00, and that for a particular description
of the lots or parcels of land bearing the respective assessment numbers
set forth in said list, reference is hereby made to the assessment and
to the diagram recorded in the office of the Superintendent of Streets
of the City after confirmation by the Council.
2. Issuance of Bonds. Bonds aggregating $2,209,494.00 in
principal amount shall be issued as herein provided upon the security
of said unpaid assessments in accordance with the provisions of the
Bond Law, and under and pursuant to the provisions of said Resolution
of Intention, and the proceedings thereunder duly had and taken. The
Bonds authorized herein (the "Bonds" and sometimes the "Bond") shall be
known as "Improvement Bonds, City of Gilroy, Obata Industrial Park
Assessment District, Series 81-1," be dated June 15, 1981, be numbered,
of the denominations and mature in the amounts and on the dates set
forth in Exhibit "B" attached hereto and by this reference made a part
hereof.
3. Interest. The Bonds shall bear interest from their date at
the rate or rates determined by the Council at the time of award of
sale of the Bonds, payable commencing on January 2, 1982, and
semiannually thereafter on July 2 and January 2 of each year to their
respective dates of maturity.
Each Bond will continue to bear interest after maturity at
the rate stated therein, provided it is presented at maturity and
payment thereof is refused on the sole ground that there is not
sufficient money in the Redemption Fund with which to pay same; if it
is not presented at maturity, interest thereon will run only until
maturity.
RESOLUTION 81 - 64
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4. Payable. The principal of and interest on the Bonds, and
any redemption premium, shall be payable by Bank of America National
Trust and Savings Association at its Corporate Agency Service Center,
San Francisco, California.
5. Form. The Bonds, the registration endorsement thereon and
the coupons to be attached to the Bonds shall be substantially in the
forms set forth in Exhibit "c" attached hereto and by this reference
made a part hereof, the blank spaces therein to be filled in to conform
to the provisions of this resolution.
6. Execution. The Bonds shall be executed on behalf of the
City and under its official seal by the Director of Finance and by the
City Clerk and the coupons shall be executed by the Director of Finance
whose signature may be reproduced on the Bonds and on the coupons by
engraved, printed or lithographed facsimile thereof, and the official
seal may be placed on the Bonds in like manner. Such signing and
sealing shall constitute and be a sufficient and binding execution of
each and everyone of the Bonds and coupons thereof, respectively.
If any officer whose signature appears on the Bonds or
coupons ceases to be such officer before the delivery of the Bonds to
the purchaser thereof, such signature shall be as valid as if such
officer had remained in office until the delivery of the Bonds.
7. Preparation and Delivery of Bonds. The City Clerk is hereby
directed to cause the Bonds to be prepared in accordance with this
resolution and the accepted bid for the Bonds, and the Director of
Finance shall deliver same upon their completion and execution to the
purchaser thereof, upon receipt of the purchase price therefor, and
upon the performance of the conditions contained in said accepted bid
for the Bond s .
8. Bond Register. The Director of Finance shall keep or cause
to be kept a regi~ter showing the series, number, date, amount, rate of
interest, the last known holder of each Bond, and the number and amount
of each interest coupon paid. The Director of Finance shall cancel or
cause to be canceled each Bond and coupon paid.
9. Establishment of Funds. There are hereby created and
established the following special funds which shall be held and
maintained by the Director of Finance as separate trust accounts,
distinct from all other accounts of the City:
(a) The Obata Industrial Park Assessment District
Improvement Fund or similar designation as determined by the Director
of Finance (the II Improvement Fund") i
(b) The Obata Industrial Park Assessment District Series
81-1 Bond Redemption Fund or similar designation as determined by the
Director of Finance (the "Redemption Fund") i and
(c) The Obata Industrial Park Assessment District Series
81-1 Bond Reserve Fund or similar designation as determined by the
Director of Finance (the "Reserve Fund").
10. Improvement Fund. Moneys received by the City from cash
payments of assessments, contributions or any other source for the
acquisition, construction and financing of the improvements described
in the assessment proceedings, together with the proceeds received from
the sale of the Bonds, including any premium received by the City on
the sale of the Bonds (but not including the moneys required to be
placed in the Reserve Fund pursuant to Section 12 hereof nor any
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accrued interest which shall be placed in the Redemption Fund) shall be
placed in the Improvement Fund. Disbursement from the Improvement Fund
shall be made exclusively to pay the costs of the acquisitions and/or
improvements, together with all expenses incidental thereto.
Any surplus remaining in the Improvement Fund after payment
of all costs shall be used, in such amounts as the Council may
determine, in accordance with the provisions of law for one or more of
the following purposes:
(a) Transfer to the general fund of the City, provided that
the amount of any such transfer shall not exceed the lesser of $1,000
or 5% of the total amount expended from the Improvement Fund:
(b) As a credit upon the assessment and any supplemental
assessment: provided that such surplus may, if the Council so
determines, also be applied as a credit to the City on account of
contributions made by it towards the cost and expenses of the
acquisitions and/or improvements in the proportion which such
contribution bears to the total amount of the assessment or supplemental
assessment prior to the deduction of all such contributions: or
(c) For the maintenance of any improvements acquired or
constructed in said proceedings.
11. Redemption Fund. Any accrued interest received on account
of the sale of the Bonds, all sums received from the collection of
unpaid assessments and interest and penalties thereon (but excluding
collection charges) as provided in Section 14 hereof, and any amounts
advanced from the Reserve Fund or otherwise in satisfaction of the
City's obligations under Section 15 hereof shall be placed in the
Redemption Fund. Disbursement from the Redemption Fund shall be made
exclusively to pay the principal or redemption price of the Bonds and
the interest due thereon.
Any surplus remaining in the Redemption Fund after payment of
all Bonds and the interest thereon shall first be applied to repayment
to the City of any special taxes levied by it for the purpose of paying
for lands purchased by it under Part 13 of the Improvement Bond Act of
1915, Division 10 of the Streets and Highways Code of the State of
California (incorporated in the Bond Law by reference) less its
recovery on the lands purchased at such delinquent sale, and also of
any costs incurred by it thereunder. The remainder shall be repaid in
accordance with the provisions of Section 8783 of said Streets and
Highways Code to persons paying supplemental assessments, if any, and
the balance may be proportionately credited upon the final installments
due upon the assessments securing the Bonds and repaid to those persons
whose assessments have been previously paid or may be transferred to
the general fund of the City.
12. Reserve Fund. An amount equal to $220,950.00 shall be
placed in the Reserve Fund upon receipt of the proceeds of the sale of
the Bonds. Moneys in the Reserve Fund shall constitute a trust fund
for the benefit of Bondholders and be paid and transferred in the
following amounts and at the following times and under any of the
following circumstances:
(a) Whenever there are insufficient funds in the Redemption
Fund to meet the next maturing installment of principal of or interest
on the Bonds due to delinquent installments of assessments, an amount
necessary to pay such deficiency shall be transferred as an advance
from the Reserve Fund to the Redemption Fund. The amount so advanced
shall be reimbursed and deposited in the Reserve Fund from the proceeds
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of redemption or sale of the parcel for which payment of delinquent
installments was made from the Reserve Fund.
(b) In the event unpaid assessments are paid in cash prior
to their final maturity date pursuant to the provisions of the Bond Law
for the advance payment of assessments, said unpaid assessments shall
be reduced. The proportionate reduction on said assessments shall
equal the ratio of the total amount initially provided for the Reserve
Fund to the total amount originally assessed in the proceedings for the
Bonds, and an amount equal to the reduction in said assessments shall
be transferred from the Reserve Fund to the Redemption Fund.
(c) At any time the amount of any interest earned by the
investment of all or any portion of the Reserve Fund together with the
principal amount in said Reserve Fund exceeds an amount equal to
fifteen percent (15%) of the aggregate principal amount of the Bonds
issued less any discount thereon, such excess shall be credited upon
the unpaid assessments in the manner set forth in Section 10427.1 of
the Streets and Highways Code of the State of California; provided
that, in order to comply with current federal regulations, in the event
said excess cannot be credited to said unpaid assessments and expended
therefor within thirteen (13) months of the date said excess has
accrued, said excess amount shall be applied to the advance retirement
of the Bonds in the manner provided in the Bond Law. Should said
federal regulations be changed, the use of the excess must conform to
said federal regulations.
(d) Whenever the balance in the Reserve Fund is sufficient
to retire all the remaining outstanding Bonds, collection of the
principal and interest on the unpaid assessments shall be discontinued
and the Reserve Fund shall be liquidated in retirement of the Bonds.
The Council shall order the same to be credited against the assessments
remaining unpaid in the manner set forth in Section 10427.1 of said
Streets and Highways Code, and the amount apportioned to each unpaid
assessment shall be credited against the last unpaid assessment
installment, and, if the amount apportioned to each parcel exceeds the
amount of said last installment, then such excess shall be credited
against the next preceding unpaid assessment installment or
installments until exhausted.
13. Investment of Funds. Moneys in the Improvement Fund, the
Redemption Fund, and the Reserve Fund may be invested in any
obligations which are then authorized by the laws of the State of
California as investments for local agencies, maturing on a date or
dates prior to the need for such moneys. Any income or interest
thereon shall accrue to and be deposited in the fund from which said
moneys were invested.
14. Collection of Unpaid Assessments. The unpaid assessments
shown on said list filed with the Director of Finance and determined by
this Council, together with the interest thereon, shall remain and
constitute a trust fund for the redemption and payment of the principal
of the Bonds and for the interest due thereon, which unpaid assessments
shall be payable in annual series corresponding in number to the number
of serial maturities of the Bonds issued. An annual proportion of each
unpaid assessment shall be payable in each year preceding the date of
maturity of each of the several series of Bonds issued, sufficient to
pay the Bonds when due, and such proportion of each unpaid assessment
coming due in any year, together with the annual interest thereon,
shall be payable in the same manner and at the same time and in the
same installments as the general taxes of the City on real property are
payable, and become delinquent at the same times and in the same
proportionate amounts and bear the same proportionate penalties and
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interest after delinquency as do the general taxes on real property of
the City. A record of the several installments of principal and
interest on said unpaid assessments which are to be collected in each
year during the term of the Bonds shall be kept in the office of the
Auditor-Controller of Santa Clara County. When the first interest
coupon is for interest for a longer period than six months, the Auditor-
Controller shall enter the amount thereof in the column on the
assessment roll provided for the first installment, and the balance in
the column on the assessment roll provided for the second installment.
All sums received from the collection of said unpaid assessments and of
the interest and penalties thereon shall be placed in the Redemption
Fund provided for herein, except that any percentage collected to
represent the costs of such collection shall be retained by said
Auditor-Controller.
15. Advances from Available Surplus Funds. In the event of a
delinquency in the payment of any installment of the assessment levied
upon any property for the payment of the principal and interest of the
Bonds, the City, in the absence of any other bidder, shall be the
purchaser of delinquent property upon which any of said assessments are
levied in like manner in which it becomes, or may become, the purchaser
of property sold for the nonpayment of general City taxes, and shall
pay and transfer from available surplus funds into the Redemption Fund
the amount of any delinquent assessment installment and interest
thereon. The City shall also pay and transfer from available surplus
funds into the Redemption Fund the amount of any future delinquent
assessment and interest thereon on such property pending redemption.
Any amounts so advanced shall be recoverable upon sale or redemption of
the property.
The obligations imposed by this Section and by Sections 8800
to 8808, inclusive, of the Streets and Highways Code of the State of
California shall not be enforceable as to any available surplus funds
of the City until all moneys in the Reserve Fund have been first
exhausted.
16. Covenant to Foreclose. The City hereby covenants with the
holders of the Bonds that it will order and cause to be commenced and
diligently prosecuted to completion, court foreclosure proceedings upon
the lien of any and all delinquent assessments and interest, pursuant
to and as provided in Part 14 of said Improvement Bond Act of 1915.
Such foreclosure proceedings shall be commenced within 90 days
following the date of such delinquency.
17. Redemption Prior to Maturity. Each Bond outstanding may be
redeemed and paid in advance of maturity upon the second day of January
or July in any year by giving at least 60 days notice and by paying the
principal amount thereof together with a premium equal to 5% of the
principal plus interest to the date of advanced maturity, unless sooner
surrendered, in which event said interest will be paid to the date of
payment, all in the manner and as provided in the Bond Law.
The provisions of Part 11 of said Improvement Bond Act of
1915 (incorporated in the Bond Law) are applicable to the advance
payment of assessments and to the calling of Bonds.
The Director of Finance shall call for redemption and retire
Bonds upon prepayment of assessments in amounts sufficient therefor.
In selecting Bonds for retirement, the lowest numbered Bonds of the
various annual maturities shall be chosen pro rata in a manner intended
to disturb as little as possible the relationship of unpaid assessments
to Bonds outstanding.
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18. Registration and Transfer of Bonds. Each Bond herein
authorized may be registered only as to both principal and interest
upon the written request of the holder and upon presentation of the
Bond to the bank named in Section 4 hereof, hereby designated as
Registrar for the Bonds.
An appropriate book shall be kept by the Registrar showing at
all times what Bonds are registered and in whose names, and, upon
presentation of the Bonds for such purpose, the Registrar shall, and
under such reasonable regulations as the Registrar may prescribe,
register or transfer or cause to be registered or transferred, in said
registry book, the Bonds as herein provided.
Upon presentation of a Bond for registration, the coupons
shall be removed therefrom and canceled (or preserved in a place of
safekeeping, at the option of the Registrar), and the name and number
of the Bond, the name and address of the holder in whose name it is to
be registered, the date of such registration and a notation that the
Bond is registered as to both principal and interest shall be entered
in the registry book, and appropriate endorsement thereof shall be made
by the Registrar in the space provided therefor on the back of the
Bond. Until such registration is discharged as hereinafter provided,
the interest when due shall be payable only to the registered owner and
the principal when due shall be payable only to such owner upon
surrender of the Bond to the Registrar.
A registered Bond may be transferred only by the registered
owner, in person or by attorney duly authorized in writing, by a
written instrument of transfer in form acceptable to the Registrar, and
by the Registrar endorsing such transfer on the Bond and in the
registry book. No transfer shall be required to be made during the
fifteen (15) days next preceding an interest payment date.
A registered Bond may be discharged from registration upon
written request of the registered owner. In such case, the Registrar
shall transfer the Bond to bearer by appropriate endorsement on the
Bond and in the registry book, cause all unmatured coupons that have
been removed from the Bond to be reattached to the Bond (such coupons
to be reprinted, if necessary), and deliver the Bond and coupons to the
owner, and thereupon negotiability and transferability by delivery
shall be restored.
Bonds that have been discharged from registration are subject
to successive registrations and transfers in the manner heretofore
provided.
The person requesting registration, transfer or discharge
from registration shall, as a condition precedent to the exercise of
such privilege, pay the Registrar's reasonable charges therefor, if
any, including any cost of reprinting the coupons and any tax or other
governmental charge required to be paid with respect thereto.
19. Arbitrage Covenant. The City covenants that as long as any
Bonds remain outstanding no use will be made at any time of the
proceeds thereof which use (1) is a use reasonably expected at the time
of issuance of the Bonds, and (2) would, if such use were reasonably
expected at the time of issuance of the Bonds, cause such Bonds to be
"arbitrage bonds" within the meaning of Section l03(c) of the Internal
Revenue Code of 1954 and the regulations thereunder as the same may be
amended from time to time; provided, however, that the right is
reserved to make any investment of such proceeds permitted by law if,
when and to the extent that said Section l03(c) or regulations
thereunder shall be repealed or relaxed or shall be held void by final
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decision of a court of competent jurisdiction, but only if any
investment made by virtue of such repeal, relaxation or decision would
not result in the interest on the Bonds being subject to federal income
taxation.
20. Use of Proceeds Certificate. The Director of Finance is
authorized to certify as to the amount and use reasonably expected by
the City, as of the date or dates of issue of the Bonds, of the
proceeds thereof, as provided by Sections 1.103-13, 1.103-14 and
1.103-15 of the Income Tax Regulations under the Internal Revenue Code
of 1954.
21. Certified Copies. The City Clerk shall forward a certified
copy of this resolution to the Director of Finance who shall take such
action as shall be necessary to assure compliance by the City with the
terms and conditions hereof. The City Clerk is further directed to
provide a certified copy of this resolution to the Auditor-Controller
of Santa Clara County.
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I hereby certify that the foregoing resolution was duly and
regularly adopted and passed by the City Council of the City of Gilroy,
California, at a regular meeting thereof held on the 15th day of June,
1981, by the following vote of the members thereof:
AYES, and in favor thereof, Councilmembers: ALBERT, ClnlNINGHA~,
LINK, PATE, TAYLOR and GOODRICH.
NOES, Councilmembers:
None
ABSENT, Councilmembers:
HUGHAN
~y
APPROVED:
/(~/~
Mayor
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LIST OF UNPAID ASSESSMENTS
OBATA INDUSTRIAL PARK ASSESSMENT DISTRICT
Diagram and
Assessment Number
Assessor's
Parcel Number
Unpaid
Assessment
1
ptn 841-15-2
$ 254,796.42
2
ptn 841-15-2
508,170.96
3
ptn 841-15-2
552,397.16
894,129.46
4
ptn 841-15-2
Total Unpaid Assessments
$2,209,494.00
EXHIBIT IIAII
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MATURITY SCHEDULE
IMPROVEMENT BONDS
CITY OF GILROY
OBATA INDUSTRIAL PARK ASSESSMENT DISTRICT
SERIES 81-1
Bond Numbers Principal Maturity Date
(Inclusive) Denomination Amount (July 2 )
1 $4,494.00 $ 4,494.00 1982
2 - 20 5,000.00 95,000.00 1982
21 - 42 5,000.00 110,000.00 1983
43 - 65 5,000.00 115,000.00 1984
66 - 90 5,000.00 125,000.00 1985
91 - 116 5,000.00 130,000.00 1986
117 - 143 5,000.00 135,000.00 1987
144 - 171 5,000.00 140,000.00 1988
172 - 200 5,000.00 145,000.00 1989
201 - 230 5,000.00 150,000.00 1990
231 - 262 5,000.00 160,000.00 1991
263 - 296 5,000.00 170,000.00 1992
297 - 331 5,000.00 175,000.00 1993
332 - 367 5,000.00 180,000.00 1994
368 - 404 5,000.00 185,000.00 1995
405 - 442 5,000.00 190,000.00 1996
$2,209,494.00
EXHIBIT "B"
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BOND FORM. The Bonds shall be substantially in the following form:
IMPROVEMENT BOND
CITY OF GILROY
OBATA INDUSTRIAL PARK ASSESSMENT DISTRICT
SERIES 81-1
BOND NO.
$
Under and by virtue of Bond Plan B, Division 3, Article III,
Chapter l2A, of the Gilroy City Code, the City of Gilroy (a municipal
corporation operating under a freeholders' charter), in the County of
Santa Clara, State of California, will, on the second day of July, ,
out of the redemption fund for the payment of the bonds issued upon-rhe
unpaid assessments made for the acquisitions, work and improvements
more fully described in Resolution of Intention No. 80-104, passed by
the City Council of said City on the 27th day of October, 1980, pay to
bearer (or, if this bond is registered as herein provided, to the
registered owner hereof) the sum of
Dollars ($
with interest thereon from the 15th day of June, 1981, at the rate
of percent ( %) per annum, all as is hereinafter specified,
and at Bank of America National Trust and Savings Association,
Corporate Agency Service Center, San Francisco, California.
This bond is one of several annual series of bonds of like date,
tenor and effect, but differing in *(interest rates, ) amounts and
maturities, issued by said City under said Bond Plan B for the purpose
of providing means for paying for the acquisitions, work and
improvements described in said Resolution of Intention, and is secured
by the moneys in said redemption fund and by the unpaid assessments
made for the payment of said acquisitions, work and improvements, and,
including principal and interest, is payable exclusively out of said
fund.
The interest is payable semiannually, to wit: On the second day
of January and July in each year hereafter, upon presentation of the
proper coupons therefor: provided, that the first of said coupons is
for the interest to the second day of January, 1982, and thereafter the
interest coupons are for the semiannual interest.
This bond will continue to bear interest after maturity at the
rate above stated: provided, it is presented at maturity and payment
thereof is refused upon the sole ground that there is not sufficient
money in said redemption fund with which to pay same. If it is not
presented at maturity, interest thereon will run until maturity.
This bond may be registered as to principal and interest, with
the privilege of transfer, discharge from registration and successive
* delete if only one interest rate
EXHIBIT "C"
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registration, upon written request of the owner and presentation of the
bond to the above named bank and payment of the charges, if any, all in
the manner and upon the terms set forth in the resolution providing for
the issuance hereof.
This bond may be redeemed and paid in advance of maturity upon
the second day of January or July in any year by giving the notice
provided in said Bond Plan B and by paying principal and accrued
interest together with a premium equal to 5 percentum of the principal.
IN WITNESS WHEREOF, said City
be signed by the Director of Finance
has caused its Clerk to affix hereto
15th day of June, 1981.
of Gilroy has caused this bond to
of said City and by its Clerk, and
its corporate seal, all on the
Clerk
Director of Finance
(SEAL)
COUPON FORM. The coupons to be attached to the Bonds shall be
substantially in the following form:
CITY OF GILROY, Santa Clara County,
California, will, unless the bond
specified herein is redeemed prior
thereto, pay to bearer the sum hereon
at Bank of America National Trust
and Savings Association, Corporate
Agency Service Center, San Francisco,
California, as interest on IMPROVEMENT
BOND, CITY OF GILROY, OBATA INDUSTRIAL
PARK ASSESSMENT DISTRICT, SERIES 81-1,
dated June 15, 1981.
On
2,
$
Coupon No.
No.
Director of Finance
EXHIBIT "c"
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REGISTRATION FORM: The form of endorsement for registration on
the Bonds shall be substantially as follows:
REGISTRATION
This bond is registered in the name of the registered owner last
entered below and both the principal of and interest on this bond are
payable only to such owner; provided that this bond may be registered
to bearer and thereby discharged from registration and the
negotiability hereof restored.
Note: No writing below except by the Registrar.
Date of
Registry
Name and Address
of Registered OWner
Signature of
Registrar
EXHIBIT "e"
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