Resolution No. 03-63 CITY OF TIGARD, OREGON
RESOLUTION NO. 03-LJ
A RESOLUTION AUTHORIZING THE ISSUANCE OF A LIMITED TAX
IMPROVEMENT BOND FOR THE REMAINING UNPAID ASSESSMENTS FOR
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 mud
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 tine costs of those improvements; and,
WHEREAS, Article XI, Section l lb of the Oregon Constitution states that assessments for local
improvements will not be"taxes"which are subject to that section's limitations if 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 desigiung, constructing and financing the
project; and,
WHEREAS, the City completed construction of the Dartmouth Street Local Improvement
Project (the"Project"), and assessed its costs against benefited properties in compliance with
Article XI, Section 1 lb of the Oregon Constitution, so that the assessments for the District
improvement project are not"taxes"which are subject to that section's limitations; and,
WHEREAS, owners of some of the assessed parcels contested tine assessments against their
property, those contests have been finally resolved in favor of the City, and those owners have
now applied to pay their assessments in installments and have waived their right to contest any
defects in those assessments; and,
WHEREAS, the City has issued its $2,015,096.93 Full Faith and Credit Local Improvement
District Note, Series 2002,which matures on May 1, 2004 and is prepayable at any time (the
"Outstanding Note")to provide interim financing for the portion of the Project that will be
financed with the contested assessments; and,
WHEREAS, the City now desires to obtain long teem financing for that portion of the Project by
issuing a limited tax improvement bond; 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,plus the amount necessary to fund any reserves and pay fmancing costs; and,
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WHEREAS, the unpaid balance of contracts for installment payment of final assessments for the
Project that were contested is $1,947,677.68; and,
WHEREAS, the City will request proposals for the purchase of the City's limited tax
improvement bond and finds that it is desirable to negotiate the sale of that bond with the
proposer offering the most advantageous terns to the city; and,
WHEREAS,the City adopts tl-ds Resolution to establish the terns under which it will issue its
Limited Tax hiaprovement Bond(Dartmouth Street Local hnproverment District), Series 2003 to
provide long term financing for costs of the District improvement project;
NOW, THEREFORE, THE CITY OF TIGARD RESOLVES AS FOLLOWS:
SECTION 1. DEFINITIONS.
Unless tie context clearly requires otherwise, the following capitalized terns shall have the
following meanings:
"Assessment Payments"means all ainounts required to be paid to the City under all contracts for
installment payment of the final assessments for the Project that were executed is1 calendar year
2003, and the net proceeds of foreclosing any such assessments.
"Available General Funds"means all taxes and other legally available general funds of the City.
"Bond"means the City's Limited Tax Improvement Bond(Dartmouth Street Local Improvement
District), Series 2003 which is 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.
"Director"means the City's Finance Director or the person designated by the Finance Director to
act on behalf of the City raider this Resolution.
"Event of Default"refers to any of the Events of Default listed in Section 6(A) of this
Resolution.
"Project"means the local improvements for which assessments were imposed in the Dartmouth
Street Local Improvement District.
"Resolution"means this Resolution.
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SECTION 2. BOND AUTHORIZED; DELEGATION.
A. The City is hereby authorized to issue the Bond to finance the Project. The principal
amount of the Bond shall not exceed the amount of applications to pay Project assessments in
installments that were executed in calendar year 2003,plus estimated costs and reserves.
B. Proceeds of the Bond shall be used to refund and prepay the Outstanding Note, to pay
costs of issuing the Bond and to fund any required reserves. The City may apply Project
assessments that were paid in cash and other City funds to pay or prepay the portion of the
Outstanding Note that will not be refunded.
C. The Director may, on behalf of the City and without fizrther 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) select a purchaser for the Bond, establish the final principal amounts, maturity schedules,
interest rates, sale prices,redemption teams,payment terms and dates, and other teams of the
Bond, enter into a bond purchase agreement with the purchaser, and sell and deliver the Bond in
accordance with that agreement and this Resolution; and,
(3) 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 obtaui long teen
financing for the portion of the Project costs that will be paid from the Assessment Payments and
carry out this Resolution.
D. T1ie Bond shall be in substantially the foram 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 fiom 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 f lly 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 ftuther act. The lien shall be valid, binding and fully
perfected against all persons having claims of any kind against the City or the 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 shall be a
limited tax improvement bond of the City, and the City shall pay the Bond from Available
General Funds to the extent that Assessment Paynnents are not sufficient to pay the Bond.
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(C) 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 udder the Code. The
Director may, on behalf of the City, enter into additional covenants to protect the tax-exempt
status of the Bond.
SECTION 5. 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 Bondowner. The
City reserves the right to corm-nit its Available General Funds and taxing power for other
puzposes without restriction.
SECTION 6. DEFAULT AND REMEDIES.
(A) The occurrence of one or more of the following shall constitute an Event of Default udder
this Resolution:
(1) Failure by the City to pay Bond principal, interest or premium when due(whether at
maturity, or upon redemption after any portion of the Bond has been properly called for
redemption);
(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 the Bondowner, for a period of 60 days after
written notice to the City by the Boadowner specifying such failure and requesting that it be
remedied;provided however, that if the failure stated in the notice carmot 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
6(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 Bondowner may waive any Event of Default and its consequences.
(C) Upon the occurrence and continuance of any Event of Default the Bondowner may take
whatever action may appear necessary or desirable to enforce or to protect any of the rights of the
Bondowner, either at law or in equity or in ban)(ruptcy 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
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right vested in the Bondowner by the Bond, 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 Bondowner 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 in equity. 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 Bondowner to exercise any remedy reserved to thein, it
shall not be necessary to give any notice other than such notice as may be required by this
Resolution or by law.
This resolution is effective immediately upon passage.
PASSED: This day of 2003.
Maya?- City of Tigard
ATTEST:
Recorder- City of Tigard
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EXHIBIT A
(Form of Bond)
No.R-<<BondNmnben> $«PrincipalAintNumbero
United States of America
State of Oregon
City of Tigard
Limited Tax Improvement Bond
(Dartmouth Street Local Improvement Project)
Series 2003
The City of Tigard, Oregon (the "City"), for value received, aclelowledges itself indebted and
hereby promises to pay to (the"Owner"), the principal amount of$ in the following
installments, together with interest at the rate of Percent Per Annum:
[insert amortization table]
Interest is payable sermia rivally on the_day of and of each year, commencing
200_, and shall be computed on the basis of a 360-day year of twelve 30-day months.
Payment of each installment of principal or interest shall be made on each payment date to the
Bondowner[insert payment procedure].
[insert redemption provisions]
This Bond is the City's Limited Tax Iinprovement Bond(Dartmouth Street Local Improvement
Project), Series 2003. This Bond is issued to finance a portion of the costs of the City's
Dartmouth Street Local hnprovement Project. This Bond is issued under and pursuant to
Resolution No. _of the City adopted on_, 2003 (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. The 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.
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.
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(Foraxm.of Bond)
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, O go
CDun a l -Pres;d pn#-
Finance Director
Page 2 Exhibit A to Resolution 1.T1NMamnouth-MnflinBond Info112-2-03 BondResolution.RTP
(Form of Bond)