Resolution No. 1994-26 | Authorizing Issuance and Sale of Refunding Bonds Consolidated Refunding District No. 1994-1 | Adopted 03/21/1994
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RESOLUTION NO. 94-26
RESOLUTION AUTHORIZING ISSUANCE AND SALE OF REFUNDING BONDS
CONSOLIDATED REFUNDING DISTRICT NO. 1994-1
The City Council of the City of Gilroy resolves:
section 1. RECITALS. On March 21, 1994, the City Council of
the City of Gilroy adopted its resolution of intention to conduct
reassessment proceedings and issue refunding bonds in Consolidated
Refunding District No. 1994-1, City of Gilroy, Santa Clara county,
California, under the provisions of the Refunding Act of 1984 for
1915 Improvement Act Bonds (the "1984 Act"). Proceedings taken
under the 1984 Act led to the levy of reassessments by the city
Council against parcels of land within the reassessment district.
These reassessments will be recorded in the office of the
County Recorder of Santa Clara county, and thereupon will become a
lien on each of the reassessment parcels. The refunding bonds are
being issued in the amount of the total reassessment.
This Council hereby finds and determines, on the basis of the
Reassessment Report on file with the city Clerk and previously
approved and confirmed by this Council in these reassessment
proceedings as follows:
a. The Reassessment Report contains the information required by
section 9523 of the 1984 Act; and
b. As evidenced by the information set forth in said Reassessment
Report, the conditions specified by section 9525 of the 1984
Act are satisfied, and this Council therefore has legal
authority to approve and confirm the Reassessment Report and
levy the proposed reassessments and to authorize, issue and
sell the proposed refunding bonds without public hearing,
which public hearing is otherwise required when the City
Council is unable to find that said conditions are satisfied.
section 2. ISSUANCE OF BONDS. The City Council hereby
authorizes the issuance of refunding bonds under the provisions of
the 1984 Act to be secured by the reassessments. The bonds shall
be designated "Limited Obligation Refunding Bond, city of Gilroy,
Consolidated Refunding District No. 1994-1, Series No. 1994-1." In
RESOLUTION NO. 94 -26
ORIGINAL
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all respects not specified in this resolution, the bonds shall be
issued in the manner prescribed by the 1984 Act.
A single registered bond shall be issued and shall be dated
the date of delivery. Bonds shall mature in principal amounts and
shall bear interest at the rates set forth in the schedule attached
as Exhibit B to that certain trust agreement dated March 21, 1994,
(the "Trust Agreement") among the City of Gilroy, the Gilroy Public
Facilities Financing Authority (the "Authority") and Union Bank, as
Trustee.
section 3. SALE OF BONDS. The refunding bonds for the
Reassessment District are hereby sold to the Authority, in
consideration of the mutual promises contained in the Trust
Agreement. To provide funds for purchase of the refunding bonds,
the Authority will issue and sell revenue bonds and will disburse
the proceeds thereof in accordance with the Trust Agreement.
section 4. APPROVAL OF AGREEMENTS. The City Council hereby
approves the form of Trust Agreement in substantially the form set
forth as Exhibit A hereto. This Council also approves that certain
Defeasance Escrow Agreement dated as of March 21, 1994, between the
City of Gilroy and Union Bank as Escrow Agent in substantially the
form set forth as Exhibit B hereto. This Council authorizes the
city Director of Finance, on recommendation of Bond Counsel, to
approve such changes and completions in the form of the Agreements
as may be required before closing of the transaction, and to
execute the Agreements.
section 5. FORM AND EXECUTION. Bonds shall be issued as
fully registered bonds substantially in the form set forth as
Exhibit C to this resolution. The bonds shall be signed by the
City Treasurer and the City Clerk and the seal of the City shall be
affixed.
section 6. PAYMENT ON BONDS. The principal and interest on
the bonds shall be remitted to the Trustee for deposit in the
Payment Account in accordance with the provisions of the Trust
Agreement.
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section 7. COVENANTS. In the event of a default in the
payment of any bond or any installment of interest thereon,
bondholders shall have the remedies set forth in the 1984 Act. In
addition, the City Council makes the following covenants, which
shall constitute a contract with the Trustee and with the owners of
the revenue bonds to be issued by the Authority:
section 7.1. FORECLOSURE OF LIENS. Not later than October 1
in any year, the City shall file an action in the Superior Court to
foreclose the lien of each delinquent reassessment if the sum of
uncured reassessment delinquencies for the preceding fiscal year
exceeds five percent (5%) of the reassessment installments posted
to the tax roll for that fiscal year, and if the amount of the
special reserve fund is less than the Reserve Requirement.
Section 7.2. ARBITRAGE. During the term of the bonds, the
City will make no use of bond proceeds which, if such use had been
reasonably expected at the date the bonds are issued, could have
caused the bonds to be "arbitrage bonds" within the meaning of
section 148 of the united States Internal Revenue Code of 1986, and
regulations of the Internal Revenue Service adopted thereunder, and
further shall rebate to the United States any amounts actually
earned as arbitrage in accordance with the provisions of that Code
and those regulations.
Section 7.3. MAINTENANCE OF TAX EXEMPTION. The City will take
all reasonable actions required to maintain the status of interest
on the bonds as excludable from gross income for federal income tax
purposes and as exempt from the State of California personal income
taxes.
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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 21st
day of March, 1994, by the following vote of the members thereof:
AYES, and in favor, thereof, Councilmembers: GILROY, KLOECKER,
MORALES, ROGERS, ROWLISON",' VALDEZ and GAGE.
NOES, Councilmembers: None
ABSENT, Councilmembers: None
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APu:J) .1,
Mayor 7}or-
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EXHIBIT "A"
LOCATION MAP FOR GPA 94-01