HomeMy WebLinkAboutItem No. 15 (New Resolution 21-51) RESOLUTION NO. 21-51
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUSTIN, CALIFORNIA, AUTHORIZING A LOAN FROM THE
LAND HELD FOR RESALE FUND TO THE TUSTIN WATER
ENTERPRISE FUND
WHEREAS, the 2020 Refunding Water Revenue Bonds bond covenant requires
net revenues including other funds accumulated in the Tustin Water Enterprise Fund (the
"Water Enterprise") which are lawfully available for payment of the debt service on the
bonds 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 Water Enterprise has incurred additional operating and capital
costs associated with improvements to certain groundwater wells that have been
temporarily turned off. Upon completion of these improvements, the Water Enterprise will
be able to maximize groundwater production and minimize the use of imported water,
which will keep long-term costs low for water customers while also providing high quality
drinking water. However, while these improvements are underway the Water Enterprise
has to rely more heavily upon the purchase of imported water to meet the City's water
demands, which has resulted in higher operating costs;
WHEREAS, the Water Enterprise will not meet the bond covenant for fiscal year
ending 6/30/21 due to the increase in imported water costs; thus requiring a
replenishment of cash in the Water Enterprise of approximately $1,000,000;
WHEREAS, the Water Enterprise's obligation to meet such bond covenant
constitutes an obligation to the bondholders;
WHEREAS, such loaned funds are to be used by the Water Enterprise to meet the
bond covenant requirements;
WHEREAS, in order to meet the bond covenant, the City of Tustin (City) desires
to loan funds from the Land Held for Resale Fund to the Water Enterprise in the amount
required to comply with the bond covenant;
NOW, THEREFORE, the City Council of the City of Tustin does hereby resolve,
determine and order as follows:
SECTION 1. The City Council hereby finds and determines that the loan of such
money to the Water Enterprise on the terms set forth herein advances the public purposes
articulated in the findings above.
Resolution 21-51
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SECTION 2. The loan of funds from the Land Held for Resale Fund to the Water
Enterprise on the terms set forth herein is hereby authorized and approved.
SECTION 3. The loan amount shall be at least equal to the amount required to
comply with the bond covenant.
SECTION 4. The loan amount shall bear zero percent (0%) interest. Repayment
of the loan is due on or before December 31, 2023.
SECTION 5. The City Council hereby finds and determines that the City has
available funds in its treasury (within the City's Land Held for Resale Fund) and that the
loan of such money to the Water Enterprise on the terms set forth herein is wise and
expedient.
SECTION 6. The officers and employees of the City and Water Enterprise are
hereby authorized and directed, for and on behalf of the City and the Water Enterprise
Fund, to do any and all things and to execute the loan and directives of this Resolution,
and any and all other documents which they or any of them deem necessary or advisable
in order to consummate the loan and otherwise to carry out, give effect to and comply
with the terms and intent of this Resolution.
SECTION 7. All actions heretofore taken by the officers and employees of the City
and Water Enterprise in connection with the matters set forth herein are hereby approved,
confirmed and ratified.
SECTION 8. This Resolution shall take effect immediately upon its adoption.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of Tustin,
California, held on the 15th day of June, 2021.
LETITIA CLARK,
Mayor
ATTEST:
ERICA N. YASUDA,
City Clerk
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STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
CITY OF TUSTIN )
I, Erica N. Yasuda, 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. 21-51
was duly passed and adopted at a regular meeting of the Tustin City Council, held on
the 15th day of June, 2021, by the following vote:
COUNCILMEMBER AYES:
COUNCILMEMBER NOES:
COUNCILMEMBER ABSTAINED:
COUNCILMEMBER ABSENT:
ERICA N. YASUDA,
City Clerk
Resolution 21-51
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