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86R-390 CITY OF ANAHEIM RESOLUTION NO. 86R-390 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM, CALIFORNIA AMENDING CERTAIN PROVISIONS OF RESOLUTION NO. 83R-168 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-168, relating to the issuance of Electric Revenue Anticipation Notes of the City; and WHEREAS, the City Council at its meeting on May 24, 1983 adopted a Resolution, designated as Resolution No. 83R-2l0, amending and supplementing said Resolution No. 83R-168; 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-168; and WHEREAS, the City Council at its meeting on November 16, 1984 adopted a Resolution, designated as Resolution No. 84R-442, supplementing and amending said Resolution No. 83R-168; and WHEREAS, the City Council at its meeting on February 25, 1986 adopted a Resolution, designated as Resolution No. 86R-72, supplementing and amending said Resolution No. 83R-16B; and WHEREAS, said Resolution No. 83R-168, 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 Note 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 heretofore amended and as amended from time to time hereafter (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, -2- ~'~",._.._., ...,"""-,.--,......_.-_.____..~~.".. """_o~.".=---~.".....~..._..,'c._..~."~"... 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 ("Bond Counsel") 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 Electric System or of any portion of the City's fuel inventory (including nuclear fuel) will be expended for additional construction of or improvements to the Electric System, for additions to the City's fuel inventory, or for the payment, purchase, or redemption of Notes or other City indebtedness incurred in connection with the Electric 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 certificates 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 -3- ...._~'-"'.._..~-,....._-,,~...-------="~--,.._.._" Representatives on December 17, 1985, as it is ultimately enacted into law ("H.R. 3838") and will comply specifically with the instructions in the Letter of Instruction from Mudge Rose Guthrie Alexander & Ferdon attached to this resolution, 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 fed- eral income tax exemption of interest 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 appli- cable 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 -4- _.,~, .. .._,_._."_._-,,,,,.-~"_..,.._. '''......'''''''-_...,_...;~.~.._--~._.,.,.~-"''",^. 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 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 two hundred seventy (270) days from the date of issuance thereof. (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. -5- ^..""'"="....'""~,,<w_.=_"'_...'"'.....""''''___,...'''_~_..,,',..,~_.^ (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 to amend or modify the Ordinance or this Resolution for the purpose of compensating the commercial bank(s) under the Revolving Credit Agreement, for changes in such commer- cial bank's or banks' financial benefits derived under the Revolving Credit Agreement, arising as a result of Federal income tax law changes and banking regulation changes, or for the purpose of substituting a commercial bank under the Revolving Credit Agreement with a bank of equal or higher credit rating as determined by a nation- ally 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 Electric Revenue Anticipation Notes issued after the date of adoption of this Resolution, provided however, -6- 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. SECTION 4. Th is Re s 01 uti on shall be eff ect i ve immediately. Except as amended in accordance herewith, the Resolution remains in full force and effect. ADOPTED, SIGNED AND APPROVED this 2nd September, 1986. day of ~a~~~ Attest: Leonora N. Soh1 //" \... /' _./) '/7/{ ~ ~- r J~C{ /' _ City Clerk -7- .""~="....,-.",~.~,,,,,,_.-,.__.~_._,--~;---.---.._,," . 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-390 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-390 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. /----) ~~ ?f ~ 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-390 duly passed and adopted by the Anaheim City Council on September 2, 1986. \///) '-Zr c-' / r/ ~?L /L ~--- CITY CLERK -....="".".- ,..""...,''''",-...,...._.., .....-.~.. ..-'_..."","""'.....-~,_.._..,_. .....j.-...., -, --+.,-",,,,...;j,-....,..=--.,-" ,,,~'",,,,",,,,"'p,,.,,,,"..,,,,=--,~