86R-389
CITY OF ANAHEIM RESOLUTION NO. 86R-389
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM,
CALIFORNIA
AMENDING CERTAIN PROVISIONS OF RESOLUTION NO. 83R-169
OF THE CITY COUNCIL (AS HERETOFORE SUPPLEMENTED AND
AMENDED) .
WHEREAS, the City Council of the City of Anaheim (the
"City") at its meeting on April 27, 1983 adopted a Resolution,
designated as Resolution No. 83R-169, relating to the issuance of
Water Revenue Anticipation Notes of the City; and
WHEREAS, the City Council at its meeting on August 28,
1984 adopted a Resolution, designated as Resolution No. 84R-332,
amending and supplementing said Resolution No. 83R-169; and
WHEREAS, the City Council at its meeting on August 28,
1984 adopted a Resolution, designated as Resolution No. 84R-334,
supplementing said Resolution No. 83R-169; and
WHEREAS, said Resolution No. 83R-169, as so supplemented
and amended, is herein referred to as the "Resolution"; and
WHEREAS, it is in the best interest of the City to fur-
ther supplement and amend the Resolution in certain respects.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ANAHEIM
DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
SECTION 1. Section 2 of the Resolution is hereby
amended to read, in its entirety, as follows:
Section 2. Covenants that Notes to Remain Tax
Exempt, Arbitrage.
The City hereby covenants that it will not
use, or permit to be used, any of the property acquired
out of, or the costs of which were reimbursed from, Note
proceeds in such manner as would result in loss of tax
exemption of interest on the Notes otherwise afforded
under Section l03(a) of the Internal Revenue Code of
1954, as amended (the "Code").
The City covenants that it will not take any
action or fail to take any action with respect to the
investment of the proceeds of any Notes issued under the
Ordinance or in any other respect which would result in
constituting the Notes "arbitrage bonds" within the
meaning of such term as used in Section l03(c) of the
Code or which would violate Treasury Regulations under
Section l03(c) of the Code applicable to the Notes.
The City covenants that it will not expend,
or permit to be expended, Note proceeds in any manner
inconsistent with its reasonable expectations as certi-
fied in the Nonarbitrage Certificates to be executed
from time to time with respect to the Notes; provided,
however, that the City may expend Note proceeds in any
manner if the City first obtains an unqualified opinion
of Mudge Rose Guthrie Alexander & Ferdon and Rourke &
Woodruff (aBond Counseln) that such expenditures will
not impair the exemption from Federal income taxes of
interest paid on the Notes.
The City covenants that proceeds from any
sale or other disposition of any portion of the Water
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System will be expended for additional construction of
or improvements to the Water System, or for the payment,
purchase, or redemption of Notes or other City indebted-
ness incurred in connection with the Water System.
The City represents that it has not been
notified of any listing or proposed listing by the
Internal Revenue Service to the effect that it is a bond
issuer whose arbitrage certifications may not be relied
upon.
In order to maintain the exemption from fed-
eral income taxation of interest on the Notes, and for
no other purpose, the City covenants to comply with each
.
applicable requirement of the Tax Reform Bill of 1985
(H.R. 3838), as adopted by the United States House of
Representatives on December 17, 1985, as it is ulti-
mately enacted into law ("H.R. 3838") and will comply
specifically with the instructions in the Letter of
Instructions provided to the City by Mudge Rose Guthrie
Alexander & Ferdon, on the date of issuance and delivery
of the Notes, as supplemented by that firm from time to
time, except for any such requirement with respect to
which the City receives an opinion of Bond Counsel to
the effect that continuing compliance by the City with
such requirement of H.R. 3838 is not required in order
to maintain the federal income tax exemption of interest
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on the Notes. The provisions of this paragraph shall no
longer be of any force or effect upon receipt of an
opinion of Bond Counsel to the effect that noncompliance
with the applicable requirements of H.R. 3838 will not
change the then current federal income tax status of the
interest on the Notes.
The City covenants that it will not issue any
Notes or other commercial paper, any proceeds of which
will not be used to refund maturing Notes (A) without an
opinion of Bond Counsel that (i) interest on the Notes
being issued will be exempt from federal income taxation
and (ii) interest on the Notes being issued will be
exempt from Federal income taxation under H.R. 3838 (or
an opinion of Bond Counsel that such opinion is not
required) or (B) unless congressional action shall have
taken place which is generally accepted by the municipal
bond market as providing assurance that the effective
date with respect to such requirement or the substantive
requirement applicable to the Notes set forth in
H.R. 3838 will be changed so that such requirement would
no longer apply to the Notes. The provisions of this
paragraph shall no longer be of any force or effect upon
receipt of an opinion of Bond Counsel to the effect that
noncompliance with the applicable requirements of
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H.R. 3838 will not change the then current federal
income tax status of the interest on the Notes.
SECTION 2. Section 4 of the Resolution is hereby
amended to read, in its entirety, as follows:
SECTION 4. Covenants Relating to Notes.
The City hereby covenants that:
(a) No Note issued under the Ordinance, other
than any Note issued pursuant to the Revolving Credit
Agreement, shall mature more than three (3) years from
the date of issuance thereof or later than the then cur-
rent Expiration Date of the Water System Credit (as
defined in the Revolving Credit Agreement), whichever is
sooner; provided that any Note issued for a term in
excess of one (1) year shall be issued in fully regis-
tered form.
(b) A Note need not bear interest from its date,
if the Determination given or delivered with respect to
such Note pursuant to the Ordinance shall specify an
interest rate of zero.
(c) So long as any Note is Outstanding, the City
will not at any time amend or modify the Ordinance or
this Resolution, without the written consent of the
holder of each Note Outstanding at such time, provided,
however, that such consent shall not be required for the
City to amend or modify the Ordinance or this Resolution
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for the purpose (i) of providing (to the extent agreed
to by the City) for compensation to the bank(s) which
are parties to the Revolving Credit Agreement, relating
to changes in the financial benefits derived by such
bank(s) under the Revolving Credit Agreement arising as
a result of Federal income tax law changes and banking
regulation changes, or (ii) replacing one or more banks
under the Revolving Credit Agreement with one or more
banks of equal or higher credit rating as determined by
a nationally recognized rating agency.
(d) Any person may rely upon the oral or written
representation of any officer listed as an Authorized
Person in the Ordinance as to the availability of any
other officer listed as an Authorized Person in the
Ordinance when such Officer makes a Determination pursu-
ant to the Ordinance.
SECTION 3. The amendment to Sections 2 and 4 of the
Resolution as set forth in Sections 1 and 2 of this Resolution
shall apply to all Water Revenue Anticipation Notes issued after
the date of adoption of this Resolution, provided however, that
such amendment shall not take effect until the date on which
Amendment No. 4 to Revolving Credit Agreement among the City,
Bank of America National Trust and Savings Association and Morgan
Guaranty Trust Company of New York is executed and delivered.
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SECTION 4. T his Res 0 1 uti 0 n s hall bee f f e c t i v e
immediately. Except as amended in accordance herewith, the
Resolution remains in full force and effect.
ADOPTED, SIGNED AND APPROVED this
2nd
day 0 f
September, 1986.
Attest: Leonora N. Sohl
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Ci tj7 Clerk
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CLERK
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SSe
CITY OF ANAHEIM )
I, LEONORA N. SOHL, City Clerk of the City of Anaheim, do hereby certify that
the foregoing Resolution No. 86R-389 was introduced and adopted at a regular
meeting provided by law, of the City Council of the City of Anaheim held on
the 2nd day of September, 1986, by the following vote of the members thereof:
AYES: COUNCIL MEMBERS: Kaywood, Overholt, Bay, Pickler and Roth
NOES: COUNCIL MEMBERS: None
ABSENT: COUNCIL MEMBERS: None
AND I FURTHER certify that the Mayor of the City of Anaheim signed said
Resolution No. 86R-389 on the 2nd day of September, 1986.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
City of Anaheim this 2nd day of September, 1986.
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CITY CLERK OF THE CITY OF ANAHEIM
(SEAL)
I LEONORA N. SOHL, City Clerk of the City of Anaheim, do hereby certify that
the foregoing is the original of Resolution No. 86R-389 duly passed and
adopted by the Anaheim City Council on September 2, 1986.
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CITY CLERK