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HomeMy WebLinkAbout2024-05 Authorizing the Issuance of Water Revenue BondsRESOLUTION NO.2024-05 A RESOLUTION OF THE CITY OF ASHLAND, OREGON AUTHORIZING THE ISSUANCE OF WATER REVENUE BONDS FOR WATER PROJECTS AND REPEALING RESOLUTION NO.2022-29 THE CITY OF ASHLAND, OREGON FINDS: A. The City of Ashland, Oregon (the "City") previously adopted Resoluton No. 2022- 29 on September 20, 2022, which authorized a borrowing in a principal amount not to exceed $44,000,000 to provide for capital improvements to the City's water system, including but not limited to water treatment plant improvements, east and west forks transmission line rehabilitation, and dam safety improvements. B. The City has since determined that it requires additional borrowing authority to finance capital improvements to the City's water system, including but not limited to water treatment plant improvements and east and west forks transmission line rehabilitation (collectively, the "Water Projects") and therefore adopts this resolution to repeal Resolution No. 2022-29 and authorize the City to issue revenue bonds in an aggregate principal amount not to exceed $75,000,000 to finance the Water Projects. C. The City is authorized to issue revenue bonds for a public purpose under ORS 287A.150 and related statutes (the "Act"). Revenue bonds issued under the Act may be payable from all or any portion of the water revenues of the City. D. The City may authorize revenue bonds under the Act by publishing a notice describing the revenue bonds. Unless at least five percent of the City's electors sign and file a petition to refer the bonds to an election within sixty days after the notice is published, the City may issue the revenue bonds described in the notice. E. It is financially feasible and in the best interests of the City to authorize the issuance of revenue bonds under the Act in order to provide the Water Projects. F. It may be desirable to issue revenue bonds to finance the Water Projects under one or more financing structures, including as water revenue bonds to the federal government through thhe Environmental Protection Agency ("EPA") Water Infrastructure Finance and Innovation Act ("WIFIA") lending program. G. Prior to the issuance of the water revenue bonds, the City may incur certain capital expenditures with respect to the Water Projects from available moneys of the City and wishes to declare its official intent to reimburse itself for any such expenditures from the proceeds of water revenue bonds authorized by this resolution. THE CITY OF ASHLAND RESOLVES: Section 1. Resolution 2022-29 Repealed. The City hereby repeals Resolution No. 2022-29. Exhibit A Notice of Revenue Bond Authorization Section 2. Revenue Bonds for Water Projects Authorized. a) The City hereby authorizes the issuance of not more than Seventy -Five Million Dollars ($75,000,000) in aggregate principal amount of revenue bonds. The proceeds of the revenue bonds may be used to finance costs of Water Projects, pay capitalized interest, fund bond reserves for the revenue bonds, and to pay costs related to the issuance of the revenue bonds. The revenue bonds shall be issued and sold in accordance with the Act. b) The bonds authorized by this resolution shall be special obligations of the City that are payable solely from water system revenues and related amounts that the City pledges to pay the bonds. Section 3. Notice; Procedure. In accordance with ORS 287A.150, the bonds authorized by Section 1 of this resolution may not be sold, and no purchase, finance, or loan agreement for those bonds may be executed until at least sixty (60) days after publication of the Notice of Revenue Bond Authorization in substantially the form which is attached to this resolution as Exhibit A (the "Notice"). The City shall cause that notice to be published promptly after adoption of this resolution. The Notice shall specify the last date on which petitions may be submitted, and shall be published in at least one newspaper of general circulation within the boundaries of the City in the same manner as are other public notices of the City. If the City receives petitions for an election, containing valid signatures of not less than five percent (5%) of the City's electors, by the date indicated in the Notice, not to exceed 60 days from date of publication of notice, the question of issuing the bonds shall be placed on the ballot at the next lawfully available election date and no bonds may be sold until the question of issuing the bonds is approved by a majority of the electors of the City who vote on that question. Section 4. Delegation. The City may sell and issue the Water Bonds, as defined below, as soon as permitted by ORS 287A.150. The City designates the City Manager, Finance Director, Public Works director, or a designee of any of those officials (each a "City Official") to act on behalf of the City, and without further action by the City Council, to: a) Issue the revenue bonds authorized by this resolution (the "Water Bonds") in one or more series, which may be sold at different times. b) Subject to the limits of this resolution, establish the final principal amounts, lien status, maturity schedules, interest rates, redemption terms, and other terms for each series of Water Bonds. c) Issue the Water Bonds as short or intermediate term bonds to provide interim financing for Water Projects and enter into lines of credit or similar documents which permit the City to draw Water Bond proceeds over time. Exhibit A Notice of Revenue Bond Authorization d) Participate in the preparation of, authorize the distribution of, and deem final the preliminary and final official statements and any other disclosure documents for each series of the Water Bonds, as applicable. e) Either publish a notice of sale, receive bids and award the sale of that series to the bidder complying with the notice and offering the most favorable terms to the City, or select one or more underwriters or lenders and negotiate the sale of that series with those underwriters or lenders and execute and deliver a bond purchase agreement or other document in connection with such sale, including a sale of a series of Water Bonds with the EPA. f) Seek the consent of the Oregon Business Development Department ("OBDD") and comply with the provisions of the loans outstanding with the OBDD so that the Water Bonds may be issued with a lien on net revenues that is equal or superior to the lien that secures the OBDD loans. g) Draft and'approve the terms of a master water system declaration in substantially the form attached to this resolution as Exhibit B, with such changes as the City Official may approve, which pledges the revenues of the City's water system to the Water Bonds, contains covenants regarding the operation of the water system and the levels of water system fees and charges that the City must impose, describes the terms of the Water Bonds, and describes the terms under which fuure obligations may be issued on a parity with the Water Bonds. h) Enter into covenants that are designed to obtain more favorable terms for the City, including covenants required by the EPA's WIFIA lending program. i) Make contributions to bond reserve accounts that the City Official determines are desirable and determine the reserve requirement, if any, for each series of the Water Bonds. j) Apply for one or more credit ratings on any series of Water Bonds, as necessary. k) Issue any qualifying series of Water Bonds as "tax-exempt bonds" bearing interest that is excludable from gross income under the Internal Revenue Code of 1986, as amended (the "Code") and enter into covenants for the benefit of the owners of those series to maintain the excludability of interest on those series from gross income under the Code. 1) Designate any qualifying series of Water Bonds as "qualified tax-exempt obligations" pursuant to section 265(b)(3) of the Code, if applicable. m) If the federal government approves subsidy payments or tax credits for municipal bonds and those subsidies or tax credits are estimated to reduce the net debt service payments for the Water Bonds, issue any series of Water Bonds as eligible for those federal subsidies or tax credits, and enter into related covenants to maintain the eligibility of such series of Water Bonds for those subsidies or tax credits. Exhibit A Notice of Revenue Bond Authorization n) Issue any series of Water Bonds as "taxable bonds" bearing interest that is includable in gross income under the Code. o) Execute any documents and take any other action in connection with the Water Bonds which the City Official finds will be advantageous to the City. Section 5. Declaration of Intent to Reimburse. The City hereby declares its official intent to reimburse itself with the proceeds of the Water Bonds for any expenditures on the Water Projects paid prior to the issuance of the Water Bonds. This declaration is adopted as official action of the City in order to comply with United States Treasury Regulation 1.150-2. Section 6. Effective Date. This resolution shall take effect upon signing by the Mayor., This resolution was duly PASSED and ADOPTED this J" Jay of March, 2024. A, A Alissa olodzinski, City Recorder SIGNED AND APPROVED this'h day of 2024. By 184 -t-- Tonya Graham, Mayor Reviewed as to form: Carmel S. Zahran, Assistant City Attorney Exhibit A Notice of Revenue Bond Authorization