HomeMy WebLinkAboutCC RES 10-31RESOLUTION NO. 10-31
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUSTIN, CALIFORNIA, AUTHORIZING THE CAPITAL
PROJECT FUND'S INVESTMENT IN A PROMISSORY
NOTE OF THE TUSTIN WATER ENTERPRISE FUND AND
AUTHORIZING THE EXECUTION OF THE PROMISSORY
NOTE BY THE WATER ENTERPRISE FUND
WHEREAS, the 2003 Refunding Water Revenue Bonds bond covenant requires
net revenues including other funds accumulated in the Fund which are lawfully available
for payment of the debt service on the Bond to equal at least 120% of the total amounts
payable for debt service during the Fiscal Year as stated in the Official Statement and
the Bond Indenture Covenant;
WHEREAS, the Tustin Water Enterprise Fund (the "Water Enterprise") did not
meet that covenant for fiscal year ending 6/30/2009 and will not meet the covenant for
fiscal year ending 6/30/2010, thus requiring a replenishment of cash in the Water
Enterprise of $2,123,437;
WHEREAS, the Water Enterprise's obligation to meet such bond covenant
constitutes an obligation to the bond holders and bond insurer;
WHEREAS, the Water Enterprise is authorized pursuant to Articles 10 and 11
(commencing with Section 53570) of Chapter 3 of Division 2 of Title 5 of the California
Government Code (the "Act") to issue bonds, warrants, notes or other evidence of
indebtedness for the purpose of meeting the bond covenant;
WHEREAS, in order to meet the bond covenant, the Water Enterprise desires to
issue, pursuant to the Act, its Promissory Note (the "Promissory Note") payable to the
City of Tustin (the "City");
WHEREAS, Section 53601 of the California Government Code provides that,
subject to the limitations specified therein, the legislative body of a local agency
(including a local agency such as the City) having money in its treasury not required for
the immediate needs of the local agency, may invest any portion of the money that it
deems wise or expedient in bonds, notes, warrants or other evidences of indebtedness
of any local agency within the State of California (including a local agency such as the
Water Enterprise);
WHEREAS, the City desires to invest in the Promissory Note by advancing to the
Water Enterprise the principal amount thereof;
WHEREAS, such advance is to be used by the Water Enterprise to meet the
bond covenant requirements;
Resolution 10-31
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WHEREAS, a form of the Promissory Note has been submitted prior to this
meeting of the City Council; and
WHEREAS, the City Council desires to authorize the investment by the City of
moneys in its treasury in the Promissory Note and the performance of such acts by or
on behalf of the City as may be necessary or desirable to effect such investment;
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of
Tustin, as follows:
Section 1. The investment by the City of a portion of the money in its treasury in
the Promissory Note is hereby authorized and approved; provided, however, that the
principal amount of the Promissory Note shall not be greater than $2,123,437, the
maturity date of the Promissory Note shall not be later than June 1, 2015 and the
interest rate on the Promissory Note shall be 3.5% per annum, compounded
semiannually.
Section 2. The City Council hereby finds and determines that the City has money
in its treasury (within the Capital Project Fund) that is not required for the immediate
needs of the City in an amount at least equal to the maximum principal amount of the
Promissory Note specified in Section 1.
Section 3. The City Council hereby finds and determines that the investment of
such money in the treasury of the City in the Promissory Note, as provided herein, is
wise and expedient.
Section 4. The officers and employees of the City, and each of them is, hereby
authorized and directed, for and in the name of the City, to do any and all things and to
execute and deliver any and all documents which they or any of them deem necessary
or advisable in order to consummate the investment of money in the City treasury in the
Promissory Note and otherwise to carry out, give effect to and comply with the terms
and intent of this Resolution.
Section 5. The officers and employees of the City and Water Enterprise Fund,
and each of them is, hereby authorized and directed, for and on behalf of the Water
Enterprise Fund, to do any and all things and to execute and deliver on behalf of the
Water Enterprise Fund the Promissory Note specified in Section 1, and any and all
other documents which they or any of them deem necessary or advisable in order to
consummate the investment of money in the City treasury in the Promissory Note and
otherwise to carry out, give effect to and comply with the terms and intent of this
Resolution.
Section 6. All actions heretofore taken by the officers and employees of the City
and Water Enterprise Fund with respect to the investment of money in the City treasury
in the Promissory Note are hereby approved, confirmed and ratified.
Resolution 10-31
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Section 7. This Resolution shall take effect immediately upon its adoption.
PASSED AND ADOPTED at a regular meeting of the Tustin City Council held on
the 6th day of April 2010.
ATTEST:
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STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
CITY OF TUSTIN )
I, Pamela Stoker, City Clerk and ex -officio Clerk of the City Council of the City of Tustin,
California, do hereby certify that the whole number of the members of the City Council of
the City of Tustin is five; that the above and foregoing Resolution No. 10-31 was duly
passed and adopted at a regular meeting of the Tustin City Council, held on the 6t' day of
April, 2010, by the following vote:
COUNCILMEMBER AYES: Amarte, Nielsen, Davert, Palmer (4)
COUNCILMEMBER NOES: Gavello (1)
COUNCILMEMBER ABSTAINED: None (0)
COUNCILMEMBER ABSENT: None (0)
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PAMELA STOKER,
C;* y Cterk
Resolution 10-31
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