HomeMy WebLinkAbout2004-043 2004 Unlimited and Limited General Obligation Refunding Bonds CITY OF YAKIMA, WASHINGTON
UNLIMITED TAX GENERAL OBLIGATION REFUNDING BONDS, 2004
LIMITED TAX GENERAL OBLIGATION REFUNDING BONDS, 2004
ORDINANCE NO 2004 - 43
AN ORDINANCE of the City of Yakima, Washington, authorizing the
issuance and sale of unlimited tax general obligation refunding
bonds of the City in the aggregate principal amount of not to
exceed $2,400,000 to refund certain outstanding unlimited tax
general obligations of the City; authorizing the issuance and sale of
limited tax general obligation refunding bonds of the City in the
aggregate principal amount of not to exceed $4,300,000 to refund
certain outstanding limited tax general obligation bonds of the
City; and fixing the terms and covenants of such bonds
PASSED July 20, 2004
Prepared by
PRESTON GATES & ELLIS LLP
Seattle, Washington
TABLE OF CONTENTS
Page
SECTION 1 Definitions. 3
SECTION 2. Issuance of the Bonds 6
SECTION 3 Registration, Exchange and Payments 7
SECTION 4 Redemption and Purchases 11
SECTION 5 Creation of Bond Accounts and Provision for Tax Levies 12
SECTION 6 Bonds Deemed To Be No Longer Outstanding 14
SECTION 7 Tax Covenant; Special Designation 15
SECTION 8 Lost or Destroyed Bonds 15
SECTION 9 Form of the Bonds 16
SECTION 10 Execution of the Bonds 22
SECTION 11 Application of Proceeds of Refunding Bonds 23
SECTION 12 Redemption of Refunded Bonds 26
SECTION 13 Finding of Savings and Defeasance 27
SECTION 14 Sale of the Bonds 28
SECTION 15 Approval of Preliminary Official Statement 28
SECTION 16 Undertaking to Provide Ongoing Disclosure 29
SECTION 17 General Authorization, Ratification of Prior Acts 32
SECTION 18 Severability 32
SECTION 19 Effective Date 32
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ORDINANCE NO. 2004 -43
AN ORDINANCE of the City of Yakima, Washington, authorizing the
issuance and sale of unlimited tax general obligation refunding
bonds of the City in the aggregate principal amount of not to
exceed $2,400,000 to refund certain outstanding unlimited tax
general obligations of the City; authorizing the issuance and sale of
limited tax general obligation refunding bonds of the City in the
aggregate principal amount of not to exceed $4,300,000 to refund
certain outstanding limited tax general obligation bonds of the
City; and fixing the terms and covenants of such bonds.
WHEREAS, the City Council of the City of Yakima, Washington (the "City ") now has
outstanding its Unlimited Tax General Obligation and Refunding Bonds, 1995 (the "1995
Bonds "), issued in the original principal amount of $7,300,000 under date of October 1, 1995,
pursuant to Ordinance No 95 -45 of the City passed on September 19, 1995, payable in principal
amounts and bearing interest as follows
Principal Payment Schedule
(December 1) Principal Amounts Interest Rates
2004 $ 180,000 5 75 %
2005 185,000 4 75
2006 195,000 4 90
2007 205,000 5 00
2008 215,000 5 10
2009 200,000 5.20
2010 240,000 5.30
2011 250,000 5 40
2012 265,000 5 50
2014 575,000 5 625
, and
WHEREAS, Ordinance No 95 -45 provides that the City may call the 1995 Bonds
maturing on and after December 1, 2006 (the "1995 Refunded Bonds ") for redemption on and
after December 1, 2005, in whole or in part on any date, at a price of par plus accrued interest, if
any, to the date of redemption, and
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WHEREAS, the City has outstanding certain of its Limited Tax General Obligation
Convention Center Bonds, 1996 (the "1996 Bonds "), issued in the original principal amount of
$6,000,000 under date of January 1, 1996 pursuant to Ordinance No 95 -53 and Resolution
No R -96 -02 of the City passed on October 17, 1995 and January 9, 1996, respectively, maturing
in principal amounts and bearing interest as follows
Maturity Years
(November 1) Principal Amounts Interest Rates
2004 $ 200,000 5 50 %
2005 210,000 5 50
2006 220,000 5 50
2007 235,000 5 50
2008 245,000 4 85
2009 255,000 5 00
2010 270,000 5 10
2011 285,000 5 10
2015 1,295,000 5.20
2019 1,505,000 5.375
, and
WHEREAS, Resolution No R -96 -02 provides that the City may redeem the portion of
the 1996 Bonds maturing on and after November 1, 2008 (the "1996 Refunded Bonds ") on and
after November 1, 2006, in whole or in part on any date, at a price of par plus accrued interest, if
any, to the date of redemption, and
WHEREAS, as a result of changed market conditions, it appears to the City Council that
debt service savings may be obtained by refunding the 1995 Refunded Bonds and by refunding
the 1996 Refunded Bonds through the issuance of a series of unlimited tax general obligation
refunding bonds (the "UTGO Refunding Bonds ") and a series of limited tax general obligation
refunding bonds (the "LTGO Refunding Bonds "), as herein authorized, and
WHEREAS, to effect such refundmgs in the most economical manner it is deemed
necessary and advisable that proceeds of sale of the UTGO Refunding Bonds and the LTGO
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Refunding Bonds and, if necessary, other money available and required for refunding purposes,
be invested in obligations maturing in such amounts and at such times as are required to pay the
interest on the 1995 Refunded Bonds and the 1996 Refunded Bonds (together, the "Refunded
Bonds ") as the same become due, and to redeem and retire the Refunded Bonds on the first date
on which such Refunded Bonds may be called for redemption prior to their respective scheduled
maturities, and
WHEREAS, the UTGO Refunding Bonds may be issued and sold as one series of bonds
and the LTGO Refunding Bonds as a second series of bonds, and
WHEREAS, it appears to the City Council that it is in the best interests of the City that
the Bonds be sold to Seattle- Northwest Securities Corporation as provided by this Ordinance,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF YAKIMA,
WASHINGTON, DO ORDAIN AS FOLLOWS
SECTION 1 Definitions. As used in this ordinance, the following words shall have the
following meanings, unless a different meaning clearly appears from the context:
"Arbitrage and Tax Certification" means the certificate executed by the Director of
Finance and Budget or her designee setting forth the requirements of the Code for maintaining
the tax - exemption of interest on the Bonds.
"Bond Register" means the registration records for the Bonds maintained by the Bond
Registrar
"Bond Registrar" means the fiscal agency of the State of Washington, in New York, New
York, for the purposes of registering and authenticating the Bonds, maintaining the Bond
Register, effecting transfer of ownership of the Bonds and paying principal of and interest on the
Bonds.
"Bonds" means the UTGO Refunding Bonds and the LTGO Refunding Bonds
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"City" means the City of Yakima, Washington, a municipal corporation duly organized
and existing under and by virtue of the Constitution and laws of the State of Washington.
"Code" means the Internal Revenue Code of 1986, as amended, together with
corresponding and applicable final, temporary or proposed regulations and revenue rulings
issued or amended with respect thereto by the United States Treasury Department of the Internal
Revenue Service, to the extent applicable to the Bonds
"Council" means the legislative authority of the City as the same shall be duly and
regularly constituted from time to time
"DTC" means The Depository Trust Company of New York, as depository for the Bonds,
or any successor or substitute depository for the Bonds.
"Escrow Agreement" means the Escrow Agreement to be dated as of the date of closing
of the Bonds and substantially in the form on file with the City
"Government Obligations" means those obligations now or hereafter defined as such in
Chapter 39 53 RCW, as such chapter may be hereafter amended or restated.
"Letter of Representations" means the Blanket Letter of Representations from the City to
DTC
"LTGO Bond Account" means the "City of Yakima Limited Tax General Obligation
Bond Redemption Account, 2004" authorized to be created by Section 5 of this ordinance.
"LTGO Refunding Bonds" means the $4,300,000 principal amount of the City of
Yakima, Washington, Limited Tax General Obligation Refunding Bonds, 2004, issued pursuant
to this ordinance to refund the 1996 Refunded Bonds.
"LTGO Refunding Account" means the account by that name established within the Debt
Service Fund pursuant to Section 11 of this ordinance
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"MSRB" means the Municipal Securities Rulemaking Board or any successor to its
functions.
"1995 Bonds" means the Unlimited Tax General Obligation and Refunding Bonds, 1995
of the City, issued under date of October 1, 1995 pursuant to Ordinance No 95 -45 passed by the
Council on September 19, 1995, and presently outstanding in the principal amount of
$2,510,000
"1995 Refunded Bonds" means the 1995 Bonds matunng on and after December 1, 2006
"1996 Bonds" means the Limited Tax General Obligation Convention Center Bonds,
1996, issued under date of January 1, 1996, pursuant to Ordinance No 95 -53 and Resolution
No R -96 -02 passed by the Council on October 17, 1995 and January 9, 1996, respectively, and
presently outstanding in the principal amount of $4,720,000
"1996 Refunded Bonds" means the portion of the 1996 Bonds maturing on and after
December 1, 2008
"NRMSIR" means a nationally- recognized municipal secunties information repository
"Refunded Bonds" means the 1995 Refunded Bonds and the 1996 Refunded Bonds.
"Registered Owner" means the person in whose name a Bond is registered on the Bond
Register For so long as the City utilizes the book -entry system for the Bonds, DTC shall be
deemed to be the Registered Owner
"Rule" means the Securities and Exchange Commission's Rule 15c2 -12 under the
Secunties Exchange Act of 1934
"Sale Resolution" means the resolution or resolutions to be adopted by the Council
setting the final terms of the Bonds.
"UTGO Bond Account" means the "City of Yakima Unlimited Tax General Obligation
Bond Redemption Account, 2004" authorized to be created by Section 5 of this ordinance
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"UTGO Refunding Bonds" means the $2,400,000 principal amount of the City of
Yakima, Washington, Unlimited Tax General Obligation Refunding Bonds, 2004, issued
pursuant to this ordinance to refund the 1995 Refunded Bonds.
"UTGO Refunding Account" means the account by that name established within the Debt
Service Fund pursuant to Section 11 of this ordinance.
"SID" means a state information repository for the State of Washington (if one is
created)
"Underwriter" means Seattle- Northwest Securities Corporation, Seattle, Washington.
SECTION 2. Issuance of the Bonds. The City shall issue and sell a series of unlimited
tax general obligation refunding bonds in the aggregate principal amount of not to exceed
$2,400,000 to refund the 1995 Refunded Bonds, and pay all costs incidental thereto Such bonds
shall be designated the "City of Yakima, Washington, Unlimited Tax General Obligation
Refunding Bonds, 2004" (the "UTGO Refunding Bonds ")
The City shall also issue and sell a series of limited tax general obligation refunding
bonds in the aggregate principal amount of not to exceed $4,300,000 to refund the 1996
Refunded Bonds and pay all costs incidental thereto Such bonds shall be designated the "City
of Yakima, Washington, Limited Tax General Obhgation Refunding Bonds, 2004" (the "LTGO
Refunding Bonds," together with the UTGO Refunding Bonds, the "Bonds ")
The Bonds shall be in fully registered form, shall be in the denomination of $5,000 each,
or any integral multiple thereof, provided that no Bond shall represent more than one maturity,
shall be dated such date, bear interest at the rates per annum, and be payable in the amounts and
dates as shall be determined by a Sale Resolution.
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The Director of Finance and Budget of the City is hereby authorized to obtain insurance
for the payment of principal of and interest on the Bonds, if she should determine that it is in the
best interests of the City to do so
SECTION 3 Registration, Exchange and Payments.
(a) Registrar /Bond Register The City hereby adopts the system of
registration approved by the Washington State Finance Committee, which utilizes the fiscal
agency of the State of Washington in New York, New York, as registrar, authenticating agent,
paying agent and transfer agent (the "Bond Registrar ") The Bond Registrar shall keep, or cause
to be kept, at its principal corporate trust office, sufficient records for the registration and transfer
of the Bonds (the "Bond Register "), which shall be open to inspection by the City The Bond
Registrar is authorized, on behalf of the City, to authenticate and deliver Bonds transferred or
exchanged in accordance with the provisions of such Bonds and this ordinance and to carry out
all of the Bond Registrar's powers and duties under this ordinance The Bond Registrar shall be
responsible for its representations contained in the Certificate of Authentication on the Bonds.
(b) Registered Ownership The City and the Bond Registrar may deem and
treat the Registered Owner of each Bond as the absolute owner for all purposes, and neither the
City nor the Bond Registrar shall be affected by any notice to the contrary Payment of any such
Bond shall be made only as described in Section 3(h) hereof, but such registration may be
transferred as herein provided. All such payments made as described in Section 3(h) shall be
valid and shall satisfy the liability of the City upon such Bond to the extent of the amount or
amounts so paid.
(c) DTC Acceptance /Letter of Representations The Bonds shall initially be
held in fully immobilized form by DTC acting as depository To induce DTC to accept the
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Bonds as eligible for deposit at DTC, the City has heretofore executed and delivered to DTC a
Blanket Issuer Letter of Representations (the "Letter of Representations ")
Neither the City nor the Bond Registrar will have any responsibility or obligation to DTC
participants or the persons for whom they act as nominees with respect to the Bonds for the
accuracy of any records maintained by DTC or any DTC participant, the payment by DTC or any
DTC participant of any amount in respect of the principal of or interest on Bonds, any notice that
is permitted or required to be given to Registered Owners under this ordinance (except such
notices as shall be required to be given by the City to the Bond Registrar or to DTC), the
selection by DTC or any DTC participant of any person to receive payment in the event of a
partial redemption of the Bonds, or any consent given or other action taken by DTC as the
Registered Owner For so long as any Bonds are held in fully immobilized form hereunder, DTC
or its successor depository shall be deemed to be the Registered Owner for all purposes, and all
references in this ordinance to the Registered Owners shall mean DTC or its nominee and shall
not mean the owners of any beneficial interest in any Bonds
(d) Use of Depository
(1) The Bonds shall be registered initially in the name of CEDE &
Co , as nominee of DTC, with a single Bond for each maturity in a denomination equal to the
total principal amount of such maturity Registered ownership of such immobilized Bonds, or
any portions thereof, may not thereafter be transferred except (A) to any successor of DTC or its
nominee, provided that any such successor shall be qualified under any applicable laws to
provide the service proposed to be provided by it; (B) to any substitute depository appointed by
the City pursuant to subsection (ii) below or such substitute depository's successor; or (C) to any
person as provided in subsection (iv) below
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(ii) Upon the resignation of DTC or its successor (or any substitute
depository or its successor) from its functions as depository or a determination by the City to
discontinue the system of book entry transfers through DTC or its successor (or any substitute
depository or its successor), the City may appoint a substitute depository Any such substitute
depository shall be qualified under any applicable laws to provide the services proposed to be
provided by it.
(iii) In the case of any transfer pursuant to clause (A) or (B) of
subsection (i) above, the Bond Registrar shall, upon receipt of all outstanding Bonds, together
with a written request on behalf of the City, issue a single new Bond for each matunty then
outstanding, registered in the name of such successor or substitute depository, or its nominee, all
as specified in such written request of the City
(iv) In the event that (A) DTC or its successor (or substitute depository
or its successor) resigns from its functions as depository, and no substitute depository can be
obtained, or (B) the City determines that it is in the best interest of the beneficial owners of the
Bonds that the Bonds be provided in certificated form, the ownership of such Bonds may then be
transferred to any person or entity as herein provided, and shall no longer be held in fully
immobilized form. The City shall deliver a written request to the Bond Registrar, together with a
supply of definitive Bonds in certificated form, to issue Bonds in any authorized denomination.
Upon receipt by the Bond Registrar of all then outstanding Bonds, together with a wntten request
on behalf of the City to the Bond Registrar, new Bonds shall be issued in the appropnate
denominations and registered in the names of such persons as are provided in such written
request.
(e) Transfer or Exchange of Registered Ownership, Change in
Denominations The registered ownership of any Bond may be transferred or exchanged, but no
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transfer of any Bond shall be valid unless it is surrendered to the Bond Registrar with the
assignment form appearing on such Bond duly executed by the Registered Owner or such
Registered Owner's duly authorized agent in a manner satisfactory to the Bond Registrar Upon
such surrender, the Bond Registrar shall cancel the surrendered Bond and shall authenticate and
deliver, without charge to the Registered Owner or transferee, a new Bond (or Bonds at the
option of the new Registered Owner) of the same series, date, maturity and interest rate and for
the same aggregate principal amount in any authorized denomination, naming as Registered
Owner the person or persons listed as the assignee on the assignment form appearing on the
surrendered Bond, in exchange for such surrendered and canceled Bond. Any Bond may be
surrendered to the Bond Registrar and exchanged, without charge, for an equal aggregate
principal amount of Bonds of the same series, date, maturity and interest rate, in any authorized
denomination. The Bond Registrar shall not be obligated to transfer or exchange any Bond
during a period beginning at the opening of business on the 15th day of the month next preceding
any interest payment date and ending at the close of business on such interest payment date, or,
in the case of any proposed redemption of the Bonds, after the mailing of notice of the call of
such Bonds for redemption.
(f) Bond Registrar's Ownership of Bonds The Bond Registrar may become
the Registered Owner of any Bond with the same rights it would have if it were not the Bond
Registrar, and to the extent permitted by law, may act as depository for and permit any of its
officers or directors to act as member of, or in any other capacity with respect to, any committee
formed to protect the rights of the Registered Owners of the Bonds.
(g) Registration Covenant The City covenants that, until all Bonds have been
surrendered and canceled, it will maintain a system for recording the ownership of each Bond
that complies with the provisions of Section 149 of the Code.
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(h) Place and Medium of Payment Both principal of and interest on the
Bonds shall be payable in lawful money of the United States of America. For so long as all
Bonds are in fully immobilized form, payments of principal and interest shall be made as
provided in accordance with the operational arrangements of DTC referred to in the Letter of
Representations. In the event that the Bonds are no longer in fully immobilized form, interest on
the Bonds shall be paid by check or draft mailed to the Registered Owners at the addresses for
such Registered Owners appearing on the Bond Register on the 15th day of the month preceding
the interest payment date, and principal of the Bonds shall be payable upon presentation and
surrender of such Bonds by the Registered Owners at the principal office of the Bond Registrar
SECTION 4 Redemption and Purchases.
(a) Redemption Prior to Maturity The Bonds may be subject to redemption
in advance of their schedule maturities as provided in a Sale Resolution to be adopted by the
Council.
(b) Notice of Redemption. Written notice of any redemption of Bonds shall be
given by the Bond Registrar on behalf of the City by first class mail, postage prepaid, not less
than 30 days nor more than 60 days before the redemption date to the registered owners of Bonds
that are to be redeemed at their last addresses shown on the Bond Register So long as the Bonds
are in book -entry form, notice of redemption shall be given as provided in the Letter of
Representations
The requirements of this section shall be deemed comphed with when notice is mailed,
whether or not it is actually received by the owner
Each notice of redemption shall contain the following information. (1) the redemption
date, (2) the redemption price, (3) if less than all outstanding Bonds are to be redeemed, the
identification (and, in the case of partial redemption, the principal amounts) of the Bonds to be
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redeemed, (4) that on the redemption date the redemption price will become due and payable
upon each Bond or portion called for redemption, and that interest shall cease to accrue from the
redemption date, (5) that the Bonds are to be surrendered for payment at the principal office of
the Bond Registrar, (6) the CUSIP numbers of all Bonds being redeemed, (7) the dated date of
the Bonds, (8) the rate of interest for each Bond being redeemed, (9) the date of the notice, and
(10) any other information needed to identify the Bonds being redeemed.
Upon the payment of the redemption price of Bonds being redeemed, each check or other
transfer of funds issued for such purpose shall bear the CUSIP number identifying, by issue and
maturity, the Bonds being redeemed with the proceeds of such check or other transfer
(c) Effect of Redemption Unless the City has revoked a notice of redemption,
the City shall transfer to the Bond Registrar amounts that, in addition to other money, if any, held
by the Bond Registrar, will be sufficient to redeem, on the redemption date, all the Bonds to be
redeemed. From the redemption date interest on each Bond to be redeemed shall cease to accrue
(d) Amendment of Notice Provisions The foregoing notice provisions of this
section, including but not limited to the information to be included in redemption notices and the
persons designated to receive notices, may be amended by additions, deletions and changes in
order to maintain compliance with duly promulgated regulations and recommendations regarding
notices of redemption of municipal securities.
(e) Purchase on Open Market The City reserves the right to purchase any of
the Bonds in the open market at any time and at any price.
SECTION 5 Creation of Bond Accounts and Provision for Tax Levies
(a) UTGO Bond Account A special account of the City known as the "City
of Yakima Unlimited Tax General Obligation Bond Redemption Account, 2004" (the "UTGO
Bond Account "), is hereby authorized to be created in the 284 — UTGO Debt Redemption Fund
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of the City The UTGO Bond Account shall be drawn upon for the sole purpose of paying the
principal of and interest on the UTGO Refunding Bonds. The taxes hereafter levied for the
purpose of paying principal of and interest on the UTGO Refunding Bonds and other funds to be
used to pay the UTGO Refunding Bonds shall be deposited in the UTGO Bond Account no later
than the date such funds are required for the payment of principal of and interest on the UTGO
Refunding Bonds Money in the UTGO Bond Account not needed to pay the interest or
principal next coming due on the UTGO Refunding Bonds may temporarily be deposited in such
institutions or invested in such obligations as may be lawful for the investment of City money
The City hereby irrevocably covenants that, unless the principal of and interest on the
UTGO Refunding Bonds are paid from other sources, it will make annual levies of taxes without
limitation as to rate or amount upon all property in the City subject to taxation in amounts
sufficient to pay such principal and interest as the same shall become due. The full faith, credit
and resources of the City are hereby irrevocably pledged for the annual levy and collection of
such taxes and for the prompt payment of such principal and interest.
(b) LTGO Bond Account A special account of the City known as the "City of
Yakima Limited Tax General Obligation Bond Redemption Account, 2004" (the "LTGO Bond
Account "), is hereby authorized to be created in the 287 LTGO Bond Redemption Fund of the
City The LTGO Bond Account shall be drawn upon for the sole purpose of paying the principal
of and interest on the LTGO Refunding Bonds.
The City hereby irrevocably covenants for as long as any of the LTGO Refunding Bonds
are outstanding and unpaid that each year it will include in its budget and pay into the LTGO
Bond Account (on or before the date due) an amount that will be sufficient to pay the pnncipal of
and interest on the LTGO Refunding Bonds as the same shall become due. None of the money
in the LTGO Bond Account shall be used for any other purpose than the payment of the pnncipal
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of and interest on the LTGO Refunding Bonds. Money in the LTGO Bond Account not needed
to pay the interest or principal next coming due may temporarily be deposited in such institutions
or invested in such obligations as may be lawful for the investment of City money Any interest
or profit from the investment of such money shall be deposited in the LTGO Bond Account.
The City hereby irrevocably pledges that, to the extent it does not have other sufficient
funds to repay the LTGO Refunding Bonds, including hotel and motel taxes levied pursuant to
RCW 67.28, it will levy an ad valorem tax upon all the property within the City subject to
taxation, within and as a part of the tax levy permitted to cities without a vote of the people, in an
amount sufficient to repay the LTGO Refunding Bonds. A sufficient portion of each annual levy
to be levied and collected by the City, including those taxes levied pursuant to RCW 67.28, pnor
to the full payment of the principal of and interest on the LTGO Refunding Bonds will be and is
hereby irrevocably set aside, pledged and appropriated for the payment of the principal of and
interest on the LTGO Refunding Bonds. The full faith, credit and resources of the City are
hereby irrevocably pledged for the annual levy and collection of such taxes and for the prompt
payment of the principal of and interest on the LTGO Refunding Bonds as the same shall
become due
SECTION 6 Bonds Deemed To Be No Longer Outstanding. In the event that the City,
in order to effect the payment, retirement or redemption of any Bond, sets aside in the applicable
Bond Account or in another special account, held in trust by a trustee, cash or noncallable
government obligations, as such obligations are now or hereafter defined in RCW 39 53, or any
combination of cash and/or noncallable government obligations, in amounts and maturities that,
together with the known earned income therefrom, are sufficient to redeem or pay and retire such
Bond in accordance with its terms and to pay when due the interest and redemption premium, if
any, thereon, and such cash and/or noncallable government obligations are irrevocably set aside
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and pledged for such purpose, then no further payments need be made into the applicable Bond
Account for the payment of the pnncipal of and interest on such Bond. The owner of a Bond so
provided for shall cease to be entitled to any hen, benefit or security of this ordinance except the
right to receive payment of principal, premium, if any, and interest from such special account,
and such Bond shall be deemed to be not outstanding under this ordinance.
SECTION 7 Tax Covenant; Special Designation. The City covenants to undertake all
actions required to maintain the tax - exempt status of interest on the Bonds under Section 103 of
the Code The City hereby designates the Bonds as "qualified tax - exempt obligations" under
Section 265(b)(3) of the Code for banks, thrift institutions and other financial institutions.
SECTION 8 Lost or Destroyed Bonds. If any Bonds are lost, stolen or destroyed, the
Bond Registrar may authenticate and deliver a new Bond or Bonds of like series, amount,
maturity and tenor to the Registered Owner upon the owner paying the expenses and charges of
the Bond Registrar and the City in connection with preparation and authentication of the
replacement Bond or Bonds and upon his or her filing with the Bond Registrar and the City
evidence satisfactory to both that such Bond or Bonds were actually lost, stolen or destroyed and
of his or her ownership, and upon furnishing the City and the Bond Registrar with indemnity
satisfactory to both.
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SECTION 9 Form of the Bonds.
(a) UTGO Refunding Bonds The UTGO Refunding Bonds shall be in
substantially the following form.
[STATEMENT OF INSURANCE]
UNITED STATES OF AMERICA
NO $
STATE OF WASHINGTON
CITY OF YAKIMA
UNLIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2004
INTEREST RATE MATURITY DATE CUSIP NO
REGISTERED OWNER.
PRINCIPAL AMOUNT DOLLARS
The City of Yakima, Washington, a municipal corporation organized and existing under
the laws and Constitution of the State of Washington (the "City "), hereby acknowledges itself to
owe and for value received promises to pay to the Registered Owner identified above, or
registered assigns, on the Maturity Date identified above, the Principal Amount specified above,
unless redeemed prior thereto as provided herein, together with interest on such Principal
Amount from the date hereof or the most recent date to which interest has been paid or duly
provided for at the Interest Rate set forth above payable December 1, , and semiannually
thereafter on each June 1 and December 1 until payment of the pnncipal sum has been made or
duly provided for Both pnncipal of and interest on this bond are payable in lawful money of the
United States of America. For so long as this bond is held in fully immobilized form, payments
of principal and interest thereon shall be made as provided in accordance with the operational
arrangements of The Depository Trust Company ( "DTC ") referred to in the Blanket Issuer Letter
of Representations from the City to DTC In the event that this bond is no longer held in fully
immobilized form, interest on this bond shall be paid by check or draft mailed to the Registered
Owner at the address appearing on the Bond Register on the 15th day of the month preceding the
interest payment date, and principal of this bond shall be payable upon presentation and
surrender of this bond by the Registered Owner at the principal office of the fiscal agency of the
State of Washington in New York, New York (the "Bond Registrar ")
This bond is one of an issue of unlimited tax general obligation refunding bonds of the
City of like date and tenor, except as to number, interest rate and date of maturity, in the
aggregate principal amount of $2,400,000 (the "Bonds "), issued pursuant to Ordinance No
and Resolution No of the City, passed May 18, 2004 and June 8, 2004, respectively,
(together, the "Bond Ordinance "), to refund certain outstanding unlimited tax general obligation
refunding bonds of the City
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The Bonds are [not] subject to redemption as provided in the Bond Ordinance
The City has designated the Bonds as "qualified tax - exempt obligations" for purchase by
financial institutions.
In the Bond Ordinance, the City has irrevocably covenanted that, unless the principal of
an interest on the Bonds are paid from other sources, it will make annual levies of taxes without
limitation as to rate or amount upon all property in the City subject to taxation in amounts
sufficient to pay such principal and interest as the same shall become due The full faith, credit
and resources of the City are hereby irrevocably pledged for the annual levy and collection of
such taxes and the prompt payment of such principal and interest.
The pledge of tax levies for payment of principal of and interest on the bonds may be
discharged prior to maturity of the bonds by making provision for the payment thereof on the
terms and conditions set forth in the Bond Ordinance.
The Bonds are issued in fully registered form in the denomination of $5,000 each or any
integral multiple thereof, provided that no bond shall represent more than one maturity Upon
surrender to the Bond Registrar, bonds are interchangeable for bonds in any authorized
denomination of an equal aggregate principal amount and of the same interest rate and maturity
This bond is transferable only on the records maintained by the Bond Registrar for that purpose
upon the surrender of this bond by the registered owner hereof or his/her duly authonzed agent
and only if endorsed in the manner provided hereon, and thereupon a new fully registered bond
of like principal amount, maturity and interest rate shall be issued to the transferee in exchange
therefor Such exchange or transfer shall be without cost to the registered owner or transferee.
The City may deem the person in whose name this bond is registered to be the absolute owner
hereof for the purpose of receiving payment of the principal of and interest on this bond and for
any and all other purposes whatsoever
Reference is made to the Bond Ordinance as more fully describing the covenants with
and the nghts of Registered Owners of the bonds or registered assigns and the meanings of
capitalized terms appearing on this bond which are defined in such ordinance.
This bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Bond Ordinance until the Certificate of Authentication hereon shall
have been manually signed by the Bond Registrar
It is hereby certified and declared that this bond is issued pursuant to and in stnct
compliance with the Constitution and laws of the State of Washington and ordinances of the
City, that all acts, conditions and things required to be done precedent to and in the issuance of
this bond and the Bonds have happened, been done and performed, and that this bond and the
Bonds do not exceed any constitutional or statutory limitations.
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IN WITNESS WHEREOF, the City of Yakima, Washington, has caused this bond to be
signed on behalf of the City with the manual or facsimile signature of the Mayor and to be
attested by the manual or facsimile signature of the Clerk of the City, as of this day of
, 2004
CITY OF YAKIMA, WASHINGTON
By /s/ manual or facsimile
Mayor
ATTEST
/s/ manual or facsimile
City Clerk
The Certificate of Authentication for the Bonds shall be in substantially the following
form and shall appear on each Bond.
CERTIFICATE OF AUTHENTICATION
Date of Authentication.
This is one of the City of Yakima, Washington, Unlimited Tax General Obligation
Refunding Bonds, dated , 2004, as described in the Bond Ordinance.
WASHINGTON STATE FISCAL
AGENCY, as Bond Registrar
By
Authonzed Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR TAXPAYER
IDENTIFICATION NUMBER OF TRANSFEREE
(Please pant or typewrite name and address, including zip code of Transferee)
the within bond and all rights thereunder and does hereby irrevocably constitute and appoint
of , or its successor,
as Agent to transfer said bond on the books kept by the Bond Register for registration thereof,
with full power of substitution in the premises.
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DATED ,
SIGNATURE GUARANTEED
NOTICE Signature(s) must be
guaranteed pursuant to law
NOTE The signature on this Assignment
must correspond with the name of the
Registered Owner as it appears upon the
face of the within bond in every particular,
without alteration or enlargement or any
change whatever
(b) LTGO Refunding Bonds The LTGO Refunding Bonds shall be in
substantially the following form.
[STATEMENT OF INSURANCE]
UNITED STATES OF AMERICA
NO $
STATE OF WASHINGTON
CITY OF YAKIMA
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2004
INTEREST RATE MATURITY DATE CUSIP NO
REGISTERED OWNER.
PRINCIPAL AMOUNT DOLLARS
The City of Yakima, Washington, a municipal corporation organized and existing under
the laws and Constitution of the State of Washington (the "City "), hereby acknowledges itself to
owe and for value received promises to pay to the Registered Owner identified above, or
registered assigns, on the Maturity Date identified above, the Principal Amount specified above,
unless redeemed prior thereto as provided herein, together with interest on such Principal
Amount from the date hereof or the most recent date to which interest has been paid or duly
provided for at the Interest Rate set forth above payable November 1, , and semiannually
thereafter on each May 1 and November 1 until payment of the principal sum has been made or
duly provided for Both principal of and interest on this bond are payable in lawful money of the
United States of America. For so long as this bond is held in fully immobilized form, payments
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of principal and interest thereon shall be made as provided in accordance with the operational
arrangements of The Depository Trust Company ( "DTC ") referred to in the Blanket Issuer Letter
of Representations from the City to DTC In the event that this bond is no longer held in fully
immobihzed form, interest on this bond shall be paid by check or draft mailed to the Registered
Owner at the address appearing on the Bond Register on the 15th day of the month preceding the
interest payment date, and principal of this bond shall be payable upon presentation and
surrender of this bond by the Registered Owner at the principal office of the fiscal agency of the
State of Washington in New York, New York (the "Bond Registrar ")
This bond is one of an issue of limited tax general obligation refunding bonds of the City
of like date and tenor, except as to number, interest rate and date of maturity, in the aggregate
principal amount of $4,300,000 (the "Bonds "), issued pursuant to Ordinance No and
Resolution No of the City, passed May 18, 2004 and June 8, 2004, respectively,
(together, the "Bond Ordinance "), to refund certain outstanding limited tax general obligations of
the City
The Bonds are [not] subject to redemption as provided in the Bond Ordinance
The City has designated the Bonds as "qualified tax - exempt obligations" for purchase by
financial institutions.
In the Bond Ordinance, the City has irrevocably covenanted that it will annually include
in its budget and levy taxes, including hotel and motel taxes levied pursuant to RCW 67.28,
within and as a part of the tax levy permitted to cities without a vote of the electorate, upon all
the property subject to taxation in amounts sufficient, together with other money legally
available therefor, to pay the principal of and interest on this bond as the same shall become due
The full faith, credit and resources of the City are hereby irrevocably pledged for the annual levy
and collection of such taxes and the prompt payment of such principal and interest.
The pledge of tax levies for payment of principal of and interest on the bonds may be
discharged prior to maturity of the bonds by making provision for the payment thereof on the
terms and conditions set forth in the Bond Ordinance.
The Bonds are issued in fully registered form in the denomination of $5,000 each or any
integral multiple thereof, provided that no bond shall represent more than one maturity Upon
surrender to the Bond Registrar, bonds are interchangeable for bonds in any authorized
denomination of an equal aggregate principal amount and of the same interest rate and maturity
This bond is transferable only on the records maintained by the Bond Registrar for that purpose
upon the surrender of this bond by the registered owner hereof or his/her duly authorized agent
and only if endorsed in the manner provided hereon, and thereupon a new fully registered bond
of like principal amount, matunty and interest rate shall be issued to the transferee in exchange
therefor Such exchange or transfer shall be without cost to the registered owner or transferee.
The City may deem the person in whose name this bond is registered to be the absolute owner
hereof for the purpose of receiving payment of the principal of and interest on this bond and for
any and all other purposes whatsoever
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Reference is made to the Bond Ordinance as more fully describing the covenants with
and the rights of Registered Owners of the bonds or registered assigns and the meanings of
capitalized terms appearing on this bond which are defined in such ordinance.
This bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Bond Ordinance until the Certificate of Authentication hereon shall
have been manually signed by the Bond Registrar
It is hereby certified and declared that this bond is issued pursuant to and in strict
compliance with the Constitution and laws of the State of Washington and ordinances of the
City, that all acts, conditions and things required to be done precedent to and in the issuance of
this bond and the Bonds have happened, been done and performed, and that this bond and the
Bonds do not exceed any constitutional or statutory limitations.
IN WITNESS WHEREOF, the City of Yakima, Washington, has caused this bond to be
signed on behalf of the City with the manual or facsimile signature of the Mayor and to be
attested by the manual or facsimile signature of the Clerk of the City, as of this day of
, 2004
CITY OF YAKIMA, WASHINGTON
By /s/ manual or facsimile
Mayor
ATTEST
/s/ manual or facsimile
City Clerk
The Certificate of Authentication for the Bonds shall be in substantially the following
form and shall appear on each Bond.
CERTIFICATE OF AUTHENTICATION
Date of Authentication.
This is one of the City of Yakima, Washington, Limited Tax General Obligation
Refunding Bonds, dated , 2004, as described in the Bond Ordinance
WASHINGTON STATE FISCAL
AGENCY, as Bond Registrar
By
Authorized Signatory
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AS SIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR TAXPAYER
IDENTIFICATION NUMBER OF TRANSFEREE
(Please print or typewrite name and address, including zip code of Transferee)
the within bond and all rights thereunder and does hereby irrevocably constitute and appoint
of , or its successor,
as Agent to transfer said bond on the books kept by the Bond Register for registration thereof,
with full power of substitution in the premises.
DATED
SIGNATURE GUARANTEED
NOTICE Signature(s) must be
guaranteed pursuant to law
NOTE The signature on this Assignment
must correspond with the name of the
Registered Owner as it appears upon the
face of the within bond in every particular,
without alteration or enlargement or any
change whatever
SECTION 10 Execution of the Bonds. The Bonds shall be executed on behalf of the
City with the manual or facsimile signature of the Mayor and attested by the manual or facsimile
signature of the City Clerk. In case either or both of the officers who have signed or attested any
of the Bonds cease to be such officer before such Bonds have been actually issued and delivered,
such Bonds shall be valid nevertheless and may be issued by the City with the same effect as
though the persons who had signed or attested such Bonds had not ceased to be such officers,
and any Bond may be signed or attested on behalf of the City by officers who at the date of
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actual execution of such Bond are the proper officers, although at the nominal date of execution
of such Bond such officer was not an officer of the City
Only Bonds that bear a Certificate of Authentication in the form set forth in Section 9,
manually executed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled
to the benefits of this ordinance. Such Certificate of Authentication shall be conclusive evidence
that the Bonds so authenticated have been duly executed, authenticated and delivered and are
entitled to the benefits of this ordinance.
In case either of the officers of the City who shall have executed the Bonds shall cease to
be such officer or officers of the City before the Bonds so signed shall have been authenticated
or delivered by the Bond Registrar, or issued by the City, such Bonds may nevertheless be
authenticated, delivered and issued and upon such authentication, delivery and issuance, shall be
as binding upon the City as though those who signed the same had continued to be such officers
of the City Any Bond may also be signed and attested on behalf of the City by such persons as
at the actual date of execution of such Bond shall be the proper officers of the City although at
the original date of such Bond any such person shall not have been such officer
Section 11 Application of Proceeds of Refunding Bond. There are hereby authorized
to be established special accounts of the City to be maintained with the Escrow Agent (as
hereinafter defined) to be known as the "2004 Unlimited Tax General Obligation Refunding
Account" (the "UTGO Refunding Account ") and the "2004 Limited Tax General Obligation
Refunding Account" (the "LTGO Refunding Account," and together with the UTGO Refunding
Account, the "Refunding Accounts "). The UTGO Refunding Account shall be drawn upon for
the sole purpose of paying the principal of and interest on the 1995 Refunded Bonds until their
date of redemption and of paying costs related to the refunding of the 1995 Refunded Bonds.
The LTGO Refunding Account shall be drawn upon for the sole purpose of paying the principal
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of and interest on the 1996 Refunded Bonds until their date of redemption and of paying costs
related to the refunding of the 1996 Refunded Bonds
The balance of proceeds of sale of each series of the Refunding Bonds (exclusive of
accrued interest, which shall be deposited into the applicable Bond Accounts) shall be deposited
in the applicable Refunding Account and, together with other funds of the City, if necessary,
shall be used immediately upon receipt thereof to defease the applicable Refunded Bonds and
discharge the other obligations of the City relating thereto under Ordinance Nos. 95 -45 and 95-
53 and Resolution No R- 96 -02, by providing for the payment of the principal of and interest on
the Refunded Bonds as set forth below The City shall defease such bonds and discharge such
obligations by the use of the money in the Refunding Accounts to purchase certain "Government
Obligations" as such obligations are defined in Chapter 39 53 RCW as now or hereafter amended
(which obligations so purchased, are herein called "Acquired Obligations "), bearing such interest
and maturing as to principal and interest in such amounts and at such times which, together with
any necessary beginning cash balance, will provide for the payment of:
(a) the interest on the 1995 Refunded Bonds to and including December 1,
2005, and
(b) the redemption price (100% of the principal amount) of the 1995
Refunded Bonds payable on December 1, 2005, and
(c) the interest on the 1996 Refunded Bonds to and including November 1,
2006, and
(d) the redemption price (100% of the principal amount) of the 1996
Refunded Bonds payable on November 1, 2006
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Such Acquired Obligations shall be purchased at a yield not greater than the yield
permitted by the Code and regulations relating to acquired obligations in connection with
refunding bond issues.
To carry out the refunding and defeasance of the Refunded Bonds, the Director of
Finance and Budget is hereby authorized to appoint as escrow agent a bank or trust company
qualified by law to perform the duties described herein (the "Escrow Agent ") Any beginning
cash balance and the Acquired Obligations shall be irrevocably deposited with the Escrow Agent
in an amount sufficient to defease the Refunded Bonds in accordance with this Section 11 Any
amounts described above that are not provided for in full by such beginning cash balance and the
purchase and deposit with the Escrow Agent of the Acquired Obligations described in this
section shall be provided for by the irrevocable deposit of the necessary amount out of the
proceeds of sale of the Refunding Bonds or any other money of the City legally available
therefor The proceeds of the Refunding Bonds remaining in the Refunding Accounts after
acquisition of the Acquired Obligations and provision for the necessary beginning cash balance
shall be utilized to pay expenses of the acquisition and safekeeping of the Acquired Obligations
and the costs of issuing the Refunding Bonds. The City may, from time to time, transfer, or
cause to be transferred, from the Refunding Accounts any money not thereafter required for the
purposes set forth in subparagraphs (a) and (b) above, subject to verification in writing by an
independent certified public accountant that such transfer will not result in inadequate funds
being available to make the required payments therefrom. The City reserves the right to
substitute other securities for the Acquired Obligations in the event it may do so pursuant to
Section 148 of the Code and applicable regulations thereunder, upon compliance with the
conditions set forth in the Escrow Agreement.
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SECTION 12. Redemption of Refunded Bonds. The City hereby irrevocably sets aside
sufficient funds through the purchase of Acquired Obligations and an initial cash deposit to make
the payments specified in subparagraphs (a) and (b) in Section 11
The City hereby irrevocably defeases and calls for redemption on December 1, 2005, the
1995 Refunded Bonds in accordance with the provisions of Ordinance No 95 -45 authonzing the
redemption and retirement of certain of the 1995 Refunded Bonds prior to their fixed maturities
The City also hereby irrevocably defeases and calls for redemption on November 1, 2006, the
1996 Refunded Bonds in accordance with the provisions of Ordinance No 95 -53 and Resolution
No R -96 -02 authorizing the redemption and retirement of certain of the 1996 Refunded Bonds
prior to their fixed maturities.
The defeasance and call for redemption of the Refunded Bonds shall be irrevocable after
the final establishment of the escrow accounts and delivery of the Acquired Obligations and the
requisite cash deposit, if any, to the Escrow Agent, except as provided herein relating to the
substitution of securities. The Director of Finance and Budget is authorized and requested to
provide whatever assistance is necessary to accomplish such defeasance
The Escrow Agent is hereby authorized and directed to notify the fiscal agency of the
State of Washington to give notice of the redemption of the Refunded Bonds in accordance with
the applicable provisions of Ordinance Nos. 95 -45 and 95 -53 and Resolution No R -96 -02 The
Director of Finance and Budget is authorized and requested to provide whatever assistance is
necessary to accomplish such redemption and the giving of notice therefor The costs of
publication of such notice shall be an expense of the City
The Escrow Agent is hereby authorized and directed to pay to the fiscal agency of the
State of Washington, as paying agent for the Refunded Bonds, sums sufficient to make, when
due, the payments specified in subparagraphs (a) and (b) in Section 11 All such sums shall be
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paid from the money and Acquired Obligations deposited with the Escrow Agent pursuant to this
section, and the income therefrom and proceeds thereof. All such sums so paid shall be credited
to the Refunding Accounts All money and Acquired Obligations deposited with the Escrow
Agent and any income therefrom shall be held, invested and applied in accordance with the
provisions of Ordinance Nos. 95 -45 and 95 -53 and Resolution No R -96 -02 and with the laws of
the State of Washington for the benefit of the City and the owners of the Refunded Bonds
The City will take such actions as are found necessary to see that all necessary and proper
fees and expenses of the Escrow Agent shall be paid when due The proper officers and agents
of the City are directed to obtain from the Escrow Agent an agreement setting forth the duties,
obligations and responsibilities of the Escrow Agent in connection with the redemption and
retirement of the Refunded Bonds as provided herein and setting forth such provisions for the
payment of the Escrow Agent as are satisfactory to it. The Mayor or Director of Finance and
Budget is authorized and directed to execute and deliver to the Escrow Agent an escrow
agreement in form satisfactory to the Escrow Agent, subject to approval by bond counsel to the
City
SECTION 13 Finding of Savings and Defeasance The Council has been advised that
market conditions are fluctuating and, as a result, the Council and the Director of Finance and
Budget may elect to refund some or all of the Refunded Bonds, if, and to the extent, that the
aggregate savings to be realized as a result of the refunding of the Refunded Bonds (i.e , the
present value of (i) the aggregate debt service of the Refunded Bonds minus (ii) the aggregate
debt service on the Refunding Bonds, after payment of all costs of issuance on the Refunding
Bonds), exceeds 3 0% (the "Savings Threshold ")
If the Council finds such Savings Threshold, the Council must find that such Acquired
Obligations to be deposited with the Escrow Agent and the income therefrom, together with any
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necessary beginning cash balance, will be sufficient to redeem the Refunded Bonds and will
discharge and satisfy the obligations of the City under Ordinance Nos 95 -45 and 95 -53 and
Resolution No R -96 -02 Immediately upon the delivery of such Acquired Obligations to the
Escrow Agent and the deposit of any necessary beginning cash balance, the Refunded Bonds
shall be deemed not to be outstanding and shall cease to be entitled to any hen, benefit or
security under such ordinance except the right to receive payment from the Acquired Obligations
and beginning cash balance so set aside and pledged.
SECTION 14 Sale of the Bonds. The Director of Finance and Budget is authorized to
negotiate a purchase contract with Seattle - Northwest Securities Corporation, Seattle,
Washington, to purchase such principal amount of the Bonds as the Director of Finance and
Budget shall determine at a price specified therein, plus accrued interest, if any, and under the
terms and conditions thereof as provided in said offer and in this ordinance subject to the
approval of the terms thereof by the Sale Resolution.
SECTION 15 Approval of Preliminary Official Statement. The City hereby authorizes
the preparation of a Preliminary Official Statement and authorizes the distribution of such
Preliminary Official Statement by the Underwriter in connection with the offering of the Bonds
Pursuant to the Rule, the City will, by subsequent resolution, deem the Preliminary Official
Statement as final as of its date except for the omission of information dependent upon the
pricing of the issue and the completion of the underwriting agreement, such as offering pnces,
interest rates, selling compensation, aggregate principal amount, principal amount per maturity,
delivery dates and other terms of the Bonds dependent on the foregoing matters. The City agrees
to cooperate with the Underwriter to deliver or cause to be delivered, within seven business days
from the date of the Purchase Contract and in sufficient time to accompany any confirmation that
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requests payment from any customer of the Underwriter, copies of a final official statement in
sufficient quantity to comply with paragraph (b)(4) of the Rule and the rules of the MSRB
SECTION 16 Undertaking to Provide Ongoing Disclosure
(a) Contract /Undertaking This section constitutes the City's written
undertaking for the benefit of the owners of the Bonds as required by Section (b)(5) of the Rule.
(b) Financial Statements /Operating Data. The City agrees to provide or
cause to be provided to each NRMSIR and to the SID, if any, in each case as designated by the
SEC in accordance with the Rule, the following annual financial information and operating data
for the prior fiscal year (commencing in 2005 for the fiscal year ended December 31, 2004)
1 Annual financial statements, which statements may or may not be
audited, showing ending fund balances for the City's general fund prepared in accordance with
the Budgeting Accounting and Reporting System prescribed by the Washington State Auditor
pursuant to RCW 43 09.200 (or any successor statute),
2 The assessed valuation of taxable property in the City;
3 Ad valorem taxes due and percentage of taxes collected,
4 Property tax levy rate per $1,000 of assessed valuation, and
5 Outstanding general obligation debt of the City
Items 2 -5 shall be required only to the extent that such information is not included in the annual
financial statements.
The information and data described above shall be provided on or before nine months
after the end of the City's fiscal year The City's current fiscal year ends December 31 The
City may adjust such fiscal year by providing written notice of the change of fiscal year to each
then existing NRMSIR and the SID, if any In lieu of providing such annual financial
information and operating data, the City may cross - reference to other documents provided to the
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NRMSIR, the SID or to the SEC and, if such document is a final official statement within the
meaning of the Rule, available from the MSRB
If not provided as part of the annual financial information discussed above, the City shall
provide the City's audited annual financial statement prepared in accordance with the Budgeting
Accounting and Reporting System prescribed by the Washington State Auditor pursuant to
RCW 43 09.200 (or any successor statute) when and if available to each then existing NRMSIR
and the SID, if any
(c) Material Events The City agrees to provide or cause to be provided, in a
timely manner, to the SID, if any, and to each NRMSIR or to the MSRB notice of the occurrence
of any of the following events with respect to the Bonds, if material
• Principal and interest payment delinquencies,
• Non - payment related defaults,
• Unscheduled draws on debt service reserves reflecting financial difficulties,
• Unscheduled draws on credit enhancements reflecting financial difficulties,
• Substitution of credit or liquidity providers, or their failure to perform,
• Adverse tax opinions or events affecting the tax - exempt status of the Bonds,
• Modifications to the rights of Bond owners,
• Bond calls (optional, contingent or unscheduled Bond calls other than scheduled
sinking fund redemptions for which notice is given pursuant to Exchange Act
Release 34- 23856),
• Defeasances,
• Release, substitution or sale of property securing repayment of the Bonds, and
• Rating changes.
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Solely for purposes of disclosure, and not intending to modify this undertaking, the City
advises that no debt service reserves, credit enhancement or property secures payment of the
Bonds and the Bonds.
(d) Notification Upon Failure to Provide Financial Data. The City agrees to
provide or cause to be provided, in a timely manner, to each NRMSIR or to the MSRB and to the
SID, if any, notice of its failure to provide the annual financial information described in
Subsection (b) above on or prior to the date set forth in Subsection (b) above
(e) Termination /Modification The City's obligations to provide annual
financial information and notices of material events shall terminate upon the legal defeasance,
prior redemption or payment in full of all of the Bonds Any provision of this section shall be
null and void if the City (1) obtains an opinion of nationally recognized bond counsel to the
effect that the portion of the Rule that requires that provision is invalid, has been repealed
retroactively or otherwise does not apply to the Bonds and (2) notifies each NRMSIR and the
SID, if any, of such opinion and the cancellation of this section.
The City may amend this section with an opinion of nationally recognized bond counsel
in accordance with the Rule. In the event of any amendment of this section, the City shall
describe such amendment in the next annual report, and shall include, a narrative explanation of
the reason for the amendment and its impact on the type (or in the case of a change of accounting
principles, on the presentation) of financial information or operating data being presented by the
City In addition, if the amendment relates to the accounting principles to be followed in
preparing financial statements, (i) notice of such change shall be given in the same manner as for
a material event under Subsection (c), and (ii) the annual report for the year in which the change
is made shall present a comparison (in narrative form and also, if feasible, in quantitative form)
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between the financial statements as prepared on the basis of the new accounting principles and
those prepared on the basis of the former accounting principles
(f) Bond Owners Remedies Under This Section The right of any bondowner
or beneficial owner of Bonds to enforce the provisions of this section shall be limited to a right to
obtain specific enforcement of the City's obligations under this section, and any failure by the
City to comply with the provisions of this undertaking shall not be an event of default with
respect to the Bonds. For purposes of this section, "beneficial owner" means any person who has
the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of,
any Bonds, including persons holding Bonds through nominees or depositories.
SECTION 17 General Authorization, Ratification of Prior Acts The Mayor and
Director of Finance and Budget and other appropriate officers of the City are authorized to take
any actions and to execute documents as in their judgment may be necessary or desirable in order
to carry out the terms of, and complete the transactions contemplated by, this ordinance All acts
taken pursuant to the authority of this ordinance but prior to its effective date are hereby ratified.
SECTION 18 Severability If any provision in this ordinance is declared by any court of
competent jurisdiction to be contrary to law, then such provision shall be null and void and shall
be deemed separable from the remaining provisions of this ordinance and shall in no way affect
the validity of the other provisions of this ordinance or of the Bonds
SECTION 19 Effective Date This ordinance shall be effective 30 days after its passage,
approval and publication as provided by law
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PASSED by the City Council of the City of Yakima, Washington, at a regular meeting
thereof, held this 20 day of July, 2004
CITY OF YAKIMA, WASHINGTON
C „
Paul P George, Mayor
ATTEST
K alt-e.v.-/ A
City Clerk
APPROVED AS TO FORM.
N / A
City Attorney
First Reading: N/A
Publication Date 7 - 23 - 2004
Effective Date 8 - 22 - 2004
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CERTIFICATE
I, the undersigned, Clerk of the City of Yakima, Washington (the "City "), and keeper of
the records of the City Council of the City (the "Council "), DO HEREBY CERTIFY
1 That the attached ordinance is a true and correct copy of Ordinance No..2ce4 -93 of
the City (the "Ordinance "), as finally passed at a regular meeting of the City Council of the City
held on May 18, 2004 and duly recorded in my office
2 That said meeting was duly convened and held in all respects in accordance with
law, and to the extent required by law, due and proper notice of such meeting was given, that a
quorum of the Council was present throughout the meeting and a legally sufficient number of
members of the City Council voted in the proper manner for the passage of said Ordinance, that
all other requirements and proceedings incident to the proper adoption or passage of said
Ordinance have been duly fulfilled, carried out and otherwise observed, and that I am authorized
to execute this certificate
DATED this 18` day of May, 2004
City Clerk
P: \NMN \NMN2CX 04/07/14
BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT Q
Item No I
For Meeting Of 7/20/2004
ITEM TITLE An Ordinance of the City of Yakima authorizing the issuance and sale of (a)
unlimited tax general obligation (UTGO) refunding bonds in an aggregate principal amount of not
to exceed $2 4 million to refund certain outstanding unlimited tax general obligations of the City;
(b) authorizing the issuance and sale of limited tax general obligation (LTGO) refunding bonds in
an aggregate principal amount of not to exceed $4 3 Million to refund certain outstanding limited
tax general obligations of the City; and fixing the terms and covenants of such bonds
SUBMITTED BY Finance Department
CONTACT PERSON/TELEPHONE Tim Jensen, Treasury Services Officer 575 -60
Rita Anson, Finance Director 575 -607 -nom
SUMMARY EXPLANATION
Background.
This Ordinance authorizes Staff to take the all steps necessary to refund two General Obligation
bond issues
1 The first issue is Unlimited Tax General Obligation Bonds, (Voted and Property Tax
backed) originally issued in 1995 to pay for a new fire station and pumper truck.
2 The second issue is Limited Tax General Obligation Bonds, backed by Ad Valorem
taxes, (General Tax Revenue), specifically, Hotel /Motel Taxes, originally issued in
1996 to finance phase 2 of the Convention Center expansion
Continued
Resolution Ordinance X Other (Specify)
Contract Mail to (name and address):
Phone
Funding Source
APPROVED FOR SUBMITTAL
City Manager
STAFF RECOMMENDATION Pass Ordinance
BOARD /COMMISSION RECOMMENDATION
COUNCIL ACTION
Ordinance passed. ORDINACE NO. 2004-43
Legal /BD
rev effective 7/21 /92
Whether these bonds are issued and the timing of the issuance is dependent both on market
conditions and certain legal and regulatory constraints
Although no sale date has been set, we are targeting late September for a possible sale
Refunding bonds is somewhat like refinancing a mortgage, only a little more complex. The City
will sell new debt (Advance Refunding Bonds) and set up escrows with the proceeds to fund
payment of the outstanding debt (the Refunded Bonds) at their first call dates, December 2005
and November 2006 respectively Once the escrow is established the existing bonds (refunded
bonds) will be considered retired The City will then make lower debt service payments on the
new bonds (refunding bonds) until they are paid off Both of these refunding bond issues will
have the same final maturities as the original bonds
Savings.
As in refinancing a mortgage, this process results in interest savings when compared to the
original debt structure In the case of the 1995 UTGO debt, the present value of the savings is
estimated at this time to be $112,676 or 5 25% of the refunded bonds, for the 1996 LTGO debt,
the present value of the savings is estimated to be $126,930 or 3.27% of the refunded bonds at
this time (Three percent savings is usually our minimum target to do a refunding) Market
conditions can change rapidly, resulting in positive or negative variance to these savings
numbers Should the savings rate on either issue fall below 3% that refunding will not be
consummated
Legal /BD
rev effective 7/21 /92