HomeMy WebLinkAbout2020-031 Replacement of LIBOR Benchmark Rate; YMC 3.123.010ORDINANCE NO. 2020-031
AN ORDINANCE amending Section 3.123.010 of the City of Yakima Municipal Code
Chapter 3.123 to identify the Secured Overnight Financing Rate (SOFR)
as the benchmark for interest calculations on interfund loans.
BE IT ORDAINED BY THE CITY OF YAKIMA:
Section 1. Section 3.123.010 of Chapter 3.123 of the City of Yakima Municipal Code is
revised to read as follows:
3.123.010 Interfund loan authorized.
The director of finance and budget is hereby authorized to administer an interfund loan
program. The director of finance and budget shall make interfund loans as needed to keep the
funds of the city solvent. In conjunction with interfund loans, the director of finance and budget
shall prepare a planned schedule of repayment of the loan principal plus applicable interest.
The monthly rate of interest will be the thirty -day Secured Overnight Financing Rate (SOFR)
rate plus one percent and shall be charged by the lending fund, unless the borrowing fund has
no other source of revenue other than the lending fund, or is normally funded by the lending
fund. In addition, the borrowing fund must anticipate sufficient revenues to be in a position over
the period of the loan to make the specified principal and interest payments. Interfund loans for
brief periods up to a calendar quarter will not be subject to interest. (Ord. 2013-011 § 1 (part),
2013).
Section 2. This ordinance shall be in full force and effect 30 days after its passage,
approval, and publication as provided by law and by the City Charter.
PASSED BY THE CITY COUNCIL, signed and approved this 1st day of December,
2020,
ATTEST:
Sonya CI
Publication Date: December 4, 202 -
Effective Date: January 3, 2021
Patricia Byers,
yor
1
BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEM ENT
Item No. 4.K.
For Meeting of: December 1, 2020
ITEM TITLE: Ordinance amending Municipal Code 3.123.010, replacement of
LIBOR benchmark rate
SUBMITTED BY: Steve Groom, Director of Finance and Budget
SUMMARY EXPLANATION:
LIBOR, the London Interbank Offered Rate, is a common benchmark for interest rates that is being
phased out; it may cease to exist by 2022. SOFR, the Secured Overnight Financing Rate, published
daily by the Federal Reserve Bank of New York, has been identified as an appropriate replacement
benchmark rate. There is one instance of LIBOR in the Yakima Municipal Code to be updated for this
change.
ITEM BUDGETED: NA
STRATEGIC PRIORITY: Public Trust and Accountability
APPROVED FOR SUBMITTAL BY THE CITY MANAGER
RECOMMENDATION:
Pass Ordinance
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