Resolution No. 98-55 8-55A RESOLUTION NO.98--25-
A
RESOLUTION AUTHORIZING ISSUANCE OF A LIMITED TAX IMPROVEMENT BOND FOR A
PORTION OF THE COSTS OF THE DARTMOUTH STREET LOCAL IMPROVEMENT DISTRICT.
WHEREAS,the City of Tigard is authorized pursuant to the Constitution and laws of the State of
Oregon,including Oregon Revised Statutes Chapter 288 and Sections 223.205 to 223.295 and the City
Charter,to construct publicly owned and operated local improvements which specially benefit properties,
to assess the specially benefited properties for the costs of local improvements,and to issue limited tax
bonds to finance the costs of those improvements;and,
WHEREAS,Article XI,Section 11 b of the Oregon Constitution states that assessments for local
improvements will not be"taxes"which are subject to that section's limitations it the local improvement is a
capital construction project undertaken by the City:(a)which provides a special benefit only to specific
properties or rectifies a problem caused by specific properties;(b)the costs of which are assessed against
those properties in a single assessment upon the completion of the project;(c)for which the payment of
the assessment plus appropriate interest may be spread over a period of at least ten years;and,(d)for
which the total of all assessments do not exceed the actual costs incurred by the City in designing,
constructing and financing the project;and,
WHEREAS,the City has completed construction of the Dartmouth Street Local improvement
project,and has assessed its costs against benefited properties in compliance with Article Xi,Section 11b
of the Oregon Constitution,so that the assessments for the Dartmouth Street Local improvement project
are not"taxes"which are subject to that section's limitations;and,
WHEREAS,the City now desires to obtain long term financing for the costs of the Project by
issuing limited tax improvement bonds;and,
WHEREAS,Oregon Revised Statutes Section 223.235(2)limits the principal amount of limited tax
improvement bonds to the unpaid balance of all contracts for installment payment of final assessments for
the local improvement project,plus the amount necessary to fund any reserves and pay financing costs;
and,
WHEREAS,the unpaid balance of contracts for installment payment of final assessments for the
Dartmouth Street Local improvement project is not expected to exceed$3,550,000;and,
WHEREAS,U.S.Bank National Association has proposed to purchase the City's bond for the
Dartmouth Street Local improvement project,the City's financial advisor has reviewed the Bank's proposal
and recommended that the City accept that proposal,and the City Council finds that a negotiated sale of
the bond to U.S.Bank National Association is desirable;and,
WHEREAS,the City adopts this Resolution to establish the terms under which it will issue its
Limited Tax Improvement Bond,Series 1998 to U.S.Bank National Association pursuant to Oregon
Revised Statutes Chapter 288 and Sections 223.205 to 223.295 to provide long term financing for costs of
the Project;
NOW,THEREFORE,THE CITY OF TIGARD RESOLVES AS FOLLOWS:
Section 1. Definitions.
Unless the context clearly requires otherwise,the following capitalized terms shall have the
following meanings:
"Assessment Payments"means all amounts required to be paid to the City under all contracts for
installment payment of final assessments for the Project,and the net proceeds of foreclosing any such
assessments.
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"Available General Funds"means all taxes and other legally available general funds of the City.
"Bank"means U.S.Bank National Association or its affiliates.
"Bond"means the City's Limited Tax Improvement Bond,Series 1998 which are authorized by this
Resolution.
"Code"means the Internal Revenue Code of 1986,as amended.
"Debt Service Fund"means a fund or account,which the City accounts for separately,but which may be
commingled with other funds or accounts for investment purposes,into which the City shall deposit all
Assessment Payments.
"Event of Default"refers to any of the Events of Default listed in Section 7(A)of tnis Resolution.
"Director"means the City's Finance Director or the person designated by the Finance Director to act on
behalf of the City under this Resolution.
"Government Obligations"means direct noncallable obligations of the United States,or obligations the
principal of and interest on which are fully and unconditionally guaranteed by the United States.
"Project"means that portion of the Dartmouth Street Local improvement project for which applications to
pay assessments in installments have been received prior to adoption :i this Resolution.
"Qualified Consultant"means an independent auditor,an independent financial advisor,or similar
independent professional consultant of which the City determines has experience and expertise in the
area for which the consultant is retained by the City to provide services under this Resolution.
AOL
"Resolution"means this Resolution as it may be amended from time to time in accordance with Section 6.
Section 2. Bond Authorized;Delegation.
(A) In order to finance the Project,the City may issue its Limited Tax Improvement Bond,
Series 1998(the"Bond")in a principal amount of nc more than Three Million Six Hundred FiftyThousand
Dollars($3,650,000).
(B) Proceeds of the Bond shall be used to finance the Project,including repaying interim
financing for the Project,and to pay costs of issuing the Bond.
(C) The Director may,on behalf of the City and without further action by the Council:
(1) participate in the preparation of,authorize the distribution of,and deem final any
disclosure documents which are required for the Bond;
(2) establish the final principal amounts,maturity schedules,interest rates,sale prices,
redemption terms,payment terms and dates,and other terms of the Bond,enter into a Bond
purchase agreement with the Bank,and sell and deliver the Bond in accordance with that
agreement and this Resolution;
(3) Designate the Series 1998 Obligations as"qualified tax-exempt obligations"under Section
265 of the Code;
(3) undertake to provide continuing disclosure for the Bond in accordance with Rule 15c2-12
Aft of the United States Securities and Exchange Commission;and,
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(4) issue,sell and deliver the Bond,and execute any documents and take any other action in
connection with the Project or the Bond which the Director finds is desirable to obtain long term
financing for the Project and carry out this Resolution.
(D) The Bond shall be in substantially the form attached to this Resolution as Exhibit A,with
such changes as may be approved by the Director. The Bond may be printed or typewritten. The Bond
shall be executed on behalf of the City with the manual or facsimile signatures of the Mayor and Director.
Section 3. Security for Bond;Flow of Funds.
(A) The Bond shall be payable primarily from the Assessment Payments. The City hereby
pledges the Assessment Payments to pay the Bond. Pursuant to ORS 223.235(5)(c),the lien of the
pledge shall be valid,binding and fully perfected from the date of issuance of the Bond. The Assessment
Payments shall be immediately subject to the lien without the physical delivery thereof,the filing of any
notice or any further act. The lien shall be valid,binding and fully perfected against all persons having
claims of any kind against the City or it is property assessed whether in tort,contract or otherwise,and
irrespective of whether such persons have notice of the lien.
(B) The City hereby pledges its full faith and credit to pay the Bond. The Bond is a limited tax
improvement bond of the City,and the City shall pay the Bond from Available Ceneral Funds to the extent
that Assessment Payments and any taxes described in Section 3(C)are not sufficient to pay the Bond.
(C) The Bond shall be a limited tax bond of the City,and,to the extent that the Assessment
Payments(and any Available General Funds the City may elect to provide)are not sufficient to pay the
Bond,the City shall,if and to the extent permitted by Section 11,Article XI of the Oregon Constitution(as
it exists on the date of this Resolution),levy a tax on all taxable property within its boundaries as
authorized by ORS 22.235(4).
(D) The City shall deposit all Assessment Payments into the Debt Service Fund.So long as
the Bond is outstanding,the City shall use amounts deposited in the Debt Service Fund only to pay Bond
principal,interest and any redemption premium.
Section 4. Tax Covenants.
The City covenants not to take any action,or omit to take any action,if the taking or omission
would cause interest on the Bond to become includable in gross income under the Code. The Director
may,on behalf of the City,enter into additional covenants to protect the tax-exempt status of the Bond.
Section S. Superior and Parity Obligations.
The City covenants not to issue any obligations other than the Bond which have a lien on the
Assessment Payments,:unless the City obtains the prior written consent of the Bank.The City reserves
the right to commit its Available General Funds and taxing power for other purposes without restriction.
Section 6. Amendment of Resolution.
The City may amend this resolution only with the prior written consent of the Bank.
Section 7. Default and Remedies.
(A) The occurrence of one or more of the following shall constitute a Event of Default under
this Resolution:
(1) Failure by the City to pay Bond principal,interest or premium when due(whether at
maturity,or upon redemption after a Bond has been properly called for redemption);
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(2) Failure by the City to observe and perform any covenant,condition or agreement on its
part to be observed or performed for the benefit of Bank,for a period of 60 days after written
notice to the City by the Bank specifying such failure and requesting that it be remedied;provided
however,that if the failure stated in the notice cannot be corrected within such 60 day period,it
shall not constitute an Event of Default so long as corrective action is instituted by the City within
the 30 day period and diligently pursued,and the default is corrected as promptly as practicable
after the City receives the written notice described in this Section 7(A)(2);or,
(3) The City is adjudged insolvent by a court of competent jurisdiction,admits in writing its
inability to pay its debts generally as they become due,files a petition in bankruptcy,or consents
to the appointment of a receiver for the installment payments.
(B) The Bank may waive any Event of Default and its consequences.
(C) Upon the occurrence and continuance of any Event of Default the Bank may take
whatever action may appear necessary or desirable to enforce or to protect any of the rights of the Eank,
either at law or in equity or in bankruptcy or otherwise,whether for the specific enforcement of any
covenant or agreement contained in this Resolution or in aid of the exercise of any power granted in this
Resolution or for the enforcement of any other legal or equitable right vested in the Bank by this
Resolution or by law. However,the Bond shall not be subject to acceleration.
(D) No remedy in this Resolution conferred upon or reserved to the Bank is intended to be
exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given
under this Resolution or now or hereafter existing at law or inequity. No delay or omission to exercise any
right or power accruing upon any default shall be construed to be a waiver thereof,but any such right and
power may be exercised from time to time and as often as may be deemed expedient. To entitle the Bank
to exercise any remedy reserved to them,it shall not be necessary to give any notice other than such
notice as may be required by this Resolution or by law.
Section 8. Defeasance.
The City shall be obligated to pay any portion of the Bond which is defeased in accordance with
this Section 8 solely from the money and Government Obligations which are deposited in escrow agent
pursuant to this Section 8. All or any portion of the Bond shall be deemed defeased if the City:
(A) irrevocably deposits money(,r noncallable Government Obligations in escrow with an
independent trustee or escrow agent which are calculated to be sufficient without reinvestment for the
payment of the portion of the Bond which is to be defeased;and,
(B) files with the escrow agent or trustee an opinion from a Qualified Consultant to the effect
that the money and the principal and interest to be received from the Government Obligations are
calculated to be sufficient,without further reinvestment,to pay the defeased portion of the Bond when
due.
Section 9. Rules of Construction.
In determining the meaning of provisions of this Resolution,the following rules-shall apply unless
the context clearly requires application of a different meaning:
(A) References to Section numbers shall be construed as references to this Resolution.
(B) References to one gender shall include all genders.
Amik (C) References to the singular include the plural,and references to the plural include the
singular.
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Passed by the Council,with a quorum in attendance,this�7 day of 1998.
r,Cibj of Tigard
611
ATTEST:
D�xxty City Recorder - Cit Tigard
Page rJ-Resolution H:M=S%DARTMiM8ONDRES.DOC
7
EXHIBIT A
(Form of Bond)
No.R-,,BondNumben> $«PrincipalAmtNumber-
United States of America
State of Oregon
City of Tigard
Limited Tax Improvement Bond
Series 1998
The City of Tigard,Oregon(the"City"),for value received,acknowledges itself indebted and
hereby premises to pay to th3 U.S.Bank National Association(the"Bank"),the principal amount of
$ in the following installments,together with interest at the rate of Four and Thirty-nine Hundredths
Percent Per Annum:
[insert amortization table]
Interest is payable semiannually on the_day of and_of each year,commencing
1999,and shall be computed on the basis of a 360-day year of twelve 30-day months.Payment
of each installrr ant of principal or interest shall be made on each payment date to the Bank[insert
payment procedure].
[insert redemption provisions]
This Bond is the City's Limited Tax Improvement Bond,Series 1998. This Bond is issued to
finance a portion of the costs of the City's Dartmouth Street Local improvement district.This Bond is
issued under and pursuant to Resolution No._of the City adopted ,1998(the"Resolution")and
in full and strict accordance and compliance with all of the provisions of the Constitution and Statutes of
the State of Oregon and the Charter of the City.
This Bond is a valid and legally binding obligation of the City.Thi City has granted a first lien on
and pledge of the Assessment Payments(as defined in the Resolution)to pay this Bond.The full faith and
credit of the City are also pledged for the punctual payment of the principal of and interest on this Bond
and the City has covenanted to pay this Bond from its Available General Funds to the extent that the
Assessment Payments are not sufficient. This Bond does not constitute a debt or indebtedness of
Washington County,the State of Oregon,or any political subdivision thereof other than the City.To the
extent that the Assessment Payments(and any Available General Funds the City may elect to provide)
are not efficient to pay this Bond,the City shall,if and to the extent permitted by Section 11,Article XI of
the Oregon Constitution(as it exists on the date of this Resolution),levy a tax on all taxable property within
its boundaries as authorized by ORS 223.235(4).
IT IS HEREBY CERTIFIED,RECITED,AND DECLARED that all conditions,acts,and things
required to exist,to happen,and to be performed precedent to and in the issuance of this Bond have
existed,have happened,and have been performed in due time,form,and manner as required by the
Constitution and Statutes of the State of Oregon and the Charter of the City;and that the issue of which
this Bond is a part,and all other obligations of the City,are within every debt limitation and other limit
prescribed by such Constitution and Statutes and City Charter.
IN WITNESS WHEREOF,the Council of the City of Tigard,Oregon,by Resolution duly passed,
has caused this Bond to be signed by its Mayor and countersigned by its Finance Director,all as of the
date first above written.
City of Tigard,Oregon
Mayor
Finance Director
Exhibit A,Page 1 (Form of Bond) HADOCSIDARTMTH160NOHESAOC