HomeMy WebLinkAboutRESO 5466• I • & '. ! • •
.ORIGINAL
RESOLUTION NO. 5466
RESOLUTION OF THE COUNCIL OF THE CITY OF
PALO ALTO PROVIDING FOR THE BORROWING OF
FUNDS FOR THE FISCAL YEAR 1977-1978 AND
THE ISSUANCE AND SALE OF TEMPORARY NOTES
THEREFOR
WHEREAS, the City of Palo Alto (the "City"), a
municipal corporation and a chartered city in the State of
California, -desires to avail itself of the provisions of-
Article 7.6 (commencing with-Section 53850), Chapter 4,
.,
Part 1, Division 2, Title 5, California Government Code,
for the purpose of borrowing the sum of $5,000,000 by
issuance of notes in anticipation of ·the receipt of taxes
and other income, revenue, cash receipts and other moneys
to be received by the City duri_ng the 1977-1978 fiscal
year (commencing July 1, 1977 and ending June 30, 1978);
and
WHEREAS, Section 53858 of said Government Code
provides that notes shall not be issued pursuant to said
Article 7.6 in_ any fiscal year in an amount which, when
added to the interest payable th~eon, shall exceed eighty-
five percent (85%) of the estimated amoWlt of the then
uncoll-ected taxes, income, revenue, cash receipts and other
moneys of-the City which will be available in ~aid fiscal
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year for the payment of said notes and interest thereon.
NOW, THEREFORE, the Council of the City of Palo
Alto hereby finds, determines, declares and resolves as
follows:
Section l. The estimated amount of the taxes
and other income, revenue, cash receipts and other moneys
remaining uncollected on October 20r 1977, and which will be
available on or before June 12, 1978, in this (1977-1978)
fiscal year for the payment of the notes and interest
thereon is the sum of at least $20,000,000. Said sum is
exclusive of taxes levied to pay the principal of and interest
on bonded indebtedness of the City, moneys which when
received will be encumbered for a special pu;pose and utility
revenues required for utility maintenance and operation.
Section 2. No sum.s.-have heretofore been borrowed
by the City in anticipation of the receipt of taxes, other -
income revenue, cash receipts or other moneys for this
(1977-1978) fiscal year.
Section 3. The City hereby determines to and shall
borrow the aggregate principal sum of Five Million Dolla~s
($5,000,000) by the issuance of temporary.notes (the "notes"),
to be numbered 1 to 50, both inclusive, of t."ie denomination
of $100,000 each, or of such nUmber(s) and denomination(s)
as shall be specified by the successful bidder therefor, to
-be dated October 20, i977 and to ~..ature (without option of
prior redemption) on June 12, 1978. The notes shall bear
interest at the rat.e of not to exceed eight percent (8%)
per annum (payable at maturity). The exact rate or rates
of interest to be paid on the notes shall be designated at
the time of determining the best bid and ma.kin<J the award
after calling for sealed proposals for the purchase thereof.
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The notes shall be sold to the bidder of ferin9 to purchase
then• at the lowest rate or rates of interest computed from
the date of the notes to the maturity date thereof, or_ whose
bid repres~nts the lowest net interest cost to the City.
The notes shall be sold for not less than the face value
thereof and shall be delivered to the purchaser and paid
for on the date thereof-. Both the principal of and interest
on the notes shall be payable only upon surrender thereof,
in lawful money of the United States of America at the
office of the City Treasurer of the City in Palo Alto, Cali-
fornia. The notes shall be issued without coupons and shall
be substantially in the form set forth in Exhibit •An attached
hereto and by this reference incorporated herein, the blanks
in said form to be filled in with appropriate words and figures.
Section 4. Said sum of $5,000,000, together with
the interest payable thereon as provided herein, is less than
85% of the amount set forth in Section 1 hereof.
Section 5. The moneys so borrowed shall be used
and expended by the City for any purpose for which it is
authorized to expend funds, including, but not limited to
current expenses, capital expenditures, and the discharge of
any obligation or indebtedness.
Section 6. It is estimated that from October 20,
1977 to June 12, 1978 -the City will receive taxes, other income,
revenue, ca.sh_ receipts and other moneys in the total sum of
at least $20,000,000, exc]-uding taxes levied to pay-'the princi-
pal of and interest on bonded indebtedness of the City, moneys
which when received will ~ encumbered for a special Pu%pc;>Se
and utility revenues required for utility maintenance ~~d
operation. For the prompt payment of the principal of and
interest on the notes, the City hereby pledges all said taxes,
income, revenue, ~ash receipts and other moneys as received
(excluding sa-id taxes levied to pay said bonded indebtedness,
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moneys which when received will be encumbered for a·special
purpose and utility revenue~ required for utility maintenance
and operation) , to the extent necessary to pay said principal
of and interest on the notes, and the notes shall constitute
a first lien and charge upon said taxes, income, revenue,
cash receipts and other moneys so pledged; provided however,
the City may, pending payment at maturity, deposit the funds
so pledged in inactive or term deposits, or invest such funds
as permitted by law, and in any such event such deposits and
such funds so invested shall remain subject to such pledge,
li.e.ri and charge.
It is hereby covenant(?d by the City that it will make
no use of the proceeds of the notes which would cause the notes
to be "arbitrage bonds" under Section 103(c) of the Internal
Revenue Code; and to that end, so long as any of the notes
are outstanding, the issµer with respect to the proceeds o~
the notes and all officers having custody or control of the
proceeds of the notes shall comply with all requirements of
such section and the regulations of the United States Depart-
ment of the Treasury thereunder, to the extent that such
regulations are, at the time, applicable and in effect, so
that the notes will not be "arbitrage bonds". -
section 7. It is hereby covenanted and warranted
by the City that all representations and recitals contained
in this resolution are true and correct, and that the City,
~nd its appropriate officials, have duly taken all proceed-
ings necessary to be taken by them, and will take any addi-
tional proceedings necessary to be taken_by them, for the
levy, collection and enforcement.of the taxes and the collec-
tion of all other income, revenue, cash receipts_and other-
moneys pledged hereunder in accordance with law for carryinq
out the previsions of this resolution and any pledge hereunder.
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Section 8. The City Treasurer is hereby autho-
rized and directed to execute the notes for and on behalf
of the City and the City Clerk is hereby authorized and
directed to countersiqn and seal the notes for and on behalf
of the City, and said si9r.in9, countersiqning and sealing_
shall constitute a valid and sufficient execution of the
_notes.
Section 9. The notes shall be sold by the Council
at public sale on M6nday, October 17, 1977 at 8:00 P.M. and
the ·city Treasurer is hereby directed to cause notice to be
given for the sale of-the notes by mailing copies of a
notice of sale to interest bidders. Said notice shall be in
substantially the form set forth in Exhibit •B• attached
hereto and by this reference incorporated herein.
Section 10. This resolution shall take effect from
. and after its passage and approval.
PASSED AND ADOPTED this 3rd day oi·october, 1977,
by the following vote:
AYES: Brenner, Carey, Clay, Eycrly, Fletcher, Henderson, Sher, Witherspoon
NOES:_ None
ABSENT: Fazzino
ABSTAINING: None M,8.yO'.C
I, f11t111 ~ faNH'r, City Clerk of the ~i ty of Palo
Alto, ·state of California, do hereby certify tha.t the above
copy of Resolution No_. S"l/l;J, is a full, true and correct
copy of said resolution now on file in my office, and that.
said resolution was adopted on the 3rd day of October, 1977
and has not been amended, rescinded or repealed and is now in
full force and effect.
IN WITNESS WHEREOI-', I have hereunto set my hand and
affixed the seal of said City this 3rd day of October, 1977 •
. ·-~y Clerk
[Seal]
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No.
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EXRIBI'l'_A
'CITY OF PALO ALTO
TEMPORARY NO'l'£
FISCAL YEAlf 1977-1978
--
October 20, 1977
-FOR VALUE RECEIVED, the City of Palo Alto (the •city0 ),
State of California, acknowledges itself indf~ted and promises
to pay to the bearer hereof, at the office of the City Treasurer
of the City in Palo Alto, California, the principal sum of~~-
OOLLARS ( $ ) in lawful money of the
United States of Americ~, on June 12, 1978 (without option of
prior redemption), together with interest thereon at ~~e rate of
__ % per annum in like lawful money from the date hereof
until payment in full of said principal sum. Both the principal
of and interest on this note shall be payable only upon surrender
of this note as the same shall fall due; provided, however, no
interest shall be payable for any period after maturity during
which the holder hereof fails to properly present this note for
payment.
It is hereby certified, recited and declared that this
note is one of an authorized issue of notes in the aggregate prin-
cipal amount of Five Million Dollars ($5,000,000) all of like tenor
made, executed and given pursuant to and by authority of a resolu~
tion of the Council of the City duly passed and adopted on
September 19, 1977 under and by authority of Article 7.6
(commencing with Section 53850) of Chapter 4, Part 1, Division 2,
Title 5, California Government Code, and that all acts, conditions
and things required to exist, happen and be t>erfo~d precedent
to and in the issuance of this note have.existed, happened and been_
performed in regular and.due time, form and manner as required
by law, and that this note, together with all other indebtness
-and obligations of the City, does not exceed any limit prescribed
by the Constitution or the statutes of the State of California
or the Charter of thi.:! City of Palo Al to.
For payment of the principal of and interest on this note
and all notes of said authorized issue, the City hereby pledges all
taxes, other income, revenue, cash receipts and other moneys of the
City remaining uncoliected on October 20, 1977, and thereafter col-
lected by the City on or before June 12. 1978 during the fiscal year
i977-1978 (exclusive of taxes levied to pay the principal of and
interest on bonded indebtedness of the City, moneys which when
received will be encumbered for a special purpose and utility
revenues required for utili:ty maintenance and operat-ion) and this
note and all notes of said authorized issue shall constitute a first
lien and charge thereon; provided, however, the City may, pending
payment at maturity, deposit the funds so pledged in inactive or
term qeposits,. or invest such fw'•ds. as permitted by law, and, in
any such event, such deI>osits and such funds so ~nvest~d shall re-
main S!Jbject to such pledge, lien a-nd cha,r9e.
IN WITNESS WHEREOF, the City of Palo AltQ has caused
this note to be executed by the-city Treasurer of the City and
countersigned py the City Clerk of the City and caused its
official seal to be affixed--hereto this 20th day of pctober, 1977.
CITY OF PALO ALTO
ISeall
By
Countersigned:
City Treasurer
City Clerk
... . .
EXHIBIT B
NOTICE OF SALE
of
$5,000,000 TEMPORARY NOTES
of
THE CITY OF PALO ALTO
STATE OF CALIFORNIA
Fiscal Year 1977-1978
NOTICE IS HEREBY GIVEN that the Council (the Rcouncil")
of the City of Palo Alto (the "Citya), Santa Clara County, State
of California, will receive bids up to 4:00 P.M. on Monday;
October 17, 1977 at the office of the City Treasurer, Civic Center,
250 Hamilton Avenue, Palo Alto, California 94301, for $5,000,000
principal amount of temporary notes (the •notesn) hereinafter
described. The notes will be sold by the Council at 8:00 P.M.
on said date at the meeting place of the Council in said Civic
Center, for cash to the bidder or bidders offering the lowest
rat~ of interest thereon or whose bid represents the lowest net
interest cost to the City. The notes will be issued in accordance
with the provisions of Section 53850 et seq. of the Government
Code of the State of California, and will be SO in nmuber, number-
ed 1 tt? 50, both inclusive, of the denomination of $100,000 each,
or of such number(s) and denomination(s) as shall be specified
by the successful bidder therefor, in the aggregate principal
amount of $5,000,000, all dated October 20, 1977 and all maturing
on June 12, 1978 (without option of prior redemption) .. The
notes will bear interest ~t such rate or rates, not to exceed
ciqht pe_rcent (8\) per annum, as shall be named by the success-
ful bidder therefor. Each bidder may_ name any number-of
different rates for the notes, provided that each rate so
named shall be a multiple of l/100 of 1, and that no one note
shall bear more than one rate of interest. Interest on the notes
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shall be paid at the maturity thereof. Each bidder shall state
separately _in his bid the rate of interest that he desires
notes of specified numbers to bear and the premium offered, if any.
Both the principal of and interest on the notes shall
be payable in lawful money of the United States of America at
the office of the City Treasurer of the City in Palo Alto,
California. Payment of the principal of and interest on the
notes will be made from City taxes and other income, revenue,
cash receipts and other moneys remaining uncollected on October 20,
1977 and to be received on or before June 12i 1978 (excluding
taxes levied to pay the principal of and interest on bonded
indebtedness of the City, moneys which when received will be
encumbered for a special purpose and utility revenues required
for utility maintenance and operation), all of which are pledged
for the payment of the notes and interest ther":on.
The notes will be awarded and sold to the bidder or
bidders whose bid represents the lowest net interest cost to the
City, such interest to be computed from the date of the notes to
June 12, 1978 on the basis cf three hundred sixty-five (365) days
per year. If two or more bidders offer to purchase the notes at
the same lowest net interest cost, the Council shall determine
which bid shall be accepted.
The right is reserved by the Council to reject any or
all bids.
Each bid must be for all the notes and not less than
the par value thereof and must be accompanied by a separate certi-
fied check or cashier's check or cash deposit in the sum of $5,000
payabl~ -~o -~he:! __ ~rder of the City Treasurer of the City of Palo Alto.
Checks or cash deposits will_be returned to unsuccessful bidders
whose bids are rejected, and the check or cash deposit of the
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successful bidder for the notes will be forfeited in case he fails
to accept and pay for the notes before noon on their date if his bid
is accepted and the notes are duly tendered for delivery on their
date.
Payment of the purchase price of the notes shail be
made on the date of deli.very of and payment for the notes in
bank funds immediately available to the City in Palo Alto,
California.
The opinion of Messrs. Orrick, Herrington, Rowley &
Sutcliffe, San Francisco, California, approving the validity of
the notes will be furnished to the successful bidder without
charge.
Dated: October 3, 1977.
City Treasurer of the City of
Palo Alto, California
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