ORDINANCE AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF $2,486,000
GENERAL OBLIGATION REVENUE BONDS OF THE CITY OF DULUTH FOR THE IMPROVEMENT
OF THE MUNICIPAL WATER UTILITY UPON TERMS AND CONDITIONS TO BE PROVIDED
BY RESOLUTION OF THE CITY COUNCIL AND PLEDGING REVENUES FOR THE
city of Duluth does ordain:
Under and pursuant to the provisions of Section 55 of the City Charter,
Section 444.075 and Chapter 475 of Minnesota Statutes and other pertinent
provisions of said Charter and Statutes, the city is authorized to issue
its general obligation bonds to provide funds for the improvement of the
municipal water utility plant, which bonds shall be a specific lien upon
such plant and are payable primarily from net revenues, as hereinafter
defined, to be derived from operation of the municipal water utility pledged
for their payment. The city has applied for and received a commitment
from the Minnesota public facilities authority (the authority) for a loan
to install water mains in portions of the Morgan Park neighborhood (the
project) as identified in the city's application to the authority.
The city council hereby determines that it is in the best interest of
the city and it is necessary to improve the municipal water utility for
the project, and determines that it is necessary to issue general obligation
water utility revenue bonds or a note in the amount of $2,486,000 for
the purpose of paying costs of the project.
The city has heretofore issued and sold the following: general obligation
water utility refunding bonds dated September 1, 1997, now outstanding
in the amount of $1,100,000; general obligation water and sewer refunding
bonds dated May 1, 1998, the water utility portion of such bonds now outstanding
in the amount of $1,025,000; general obligation water and sewer utilities
revenue bonds dated December 1, 2000, the water utility portion of such
bonds now outstanding in the amount of $1,315,000; general obligation
utilities facility bonds dated September 1, 2002, the water utility portion
of such bonds now outstanding in the amount of $1,603,000; general obligation
utilities revenue bonds dated December 1, 2002, the water utility
portion of such bonds now outstanding in the amount of $1,320,000; and
general obligation water and sewer utilities revenue bonds dated March
1, 2003, the water utility portion of such bonds now outstanding in the
amount of $540,000. Under the provisions of the ordinances authorizing
said bonds, the city reserved the privilege of issuing additional bonds
payable from said net revenues on a parity with the bonds dated September 1,
1997, May 1, 1998, December 1, 2000, September 1, 2002, December 1, 2002,
and March 1, 2003.
the authority herein recited, the city council hereby authorizes and directs
the issuance and sale of general obligation water utility revenue bonds
or a note of the city of Duluth in the amount of $2,486,000, and pledges
the full faith and credit and taxing powers of the city irrevocably for
the payment of the principal and interest when due on such bonds, and
also pledges and appropriates irrevocably, to the amounts required for
the payment of the principal and interest on the bonds and the maintenance
of a reserve, any and all net revenues to be derived from time to time
from the operation of the municipal water utility. Net revenues are defined
as sums from time to time within the water utility operating account within
the water utility fund maintained under Section 54 of the City Charter,
in excess of sums required to pay claims duly approved and allowed for
payment of expenses which, under generally accepted accounting principles,
constitute normal, reasonable and current expenses of operating and maintaining
the municipal water utility and to maintain such reasonable reserves for
such expenses as the director of public works and utilities shall determine
to be necessary from time to time in accordance with the policies established
by the city council.
The city reserves the right and privilege of issuing additional bonds
and of pledging and appropriating the net revenues of the municipal water
utility for the payment thereof, when authorized in accordance with law
and the City Charter and determined by the city council to be necessary
for the improvement of the municipal water utility or for the refunding
of indebtedness payable from said net revenues, provided that no such
pledge shall constitute a lien upon the net revenues superior to the pledge
thereof for the payment of the bonds issued hereunder.
2. TERMS OF
The city council shall, by resolution or resolutions, provide for the
issuance and sale of such bonds in one or more series and shall fix the
precise maturities, interest rates, redemption provisions and other terms
and conditions of such bonds, and prescribe the form thereof, and offer
to sell such bonds in such a manner and at such time or times as shall
be deemed in the public interest, all in accordance with the authority
recited in Section 1.01 of this ordinance.
REVENUES AND ACCOUNTS.
The city council shall, by resolution or resolutions, provide for the
method of imposing and collecting just and equitable charges for all use
and for the availability of all facilities of the municipal water utility
at the times and amounts required to pay the normal, reasonable and current
operating expenses and to maintain the municipal water utility and also
produce net revenues at least adequate at all times to pay the principal
and interest due on the bonds issued hereunder and on all other bonds
heretofore and hereafter issued and made payable from said net revenues.
The city council shall, by further resolution or resolutions, establish
appropriate accounts and credit monies from the proceeds of the bonds
herein authorized to accounts, all in accordance with Section 54 of the
City Charter and Chapter 475 of Minnesota Statutes.
The city clerk
is directed to file with the county auditor of St. Louis County a
certified copy of this ordinance, and such other information as the county
may require, and to obtain from the county auditor a certificate stating
that the bonds herein authorized have been duly entered on his register.
The officers of the city and the county auditor are authorized and directed
to prepare and furnish to the purchasers of the bonds, and to bond counsel,
certified copies of all proceedings and records of the city relating to
the authorization and issuance of the bonds and such other affidavits
and certificates as may reasonably be required to show the facts relating
to the legality and marketability of the bonds as such facts appear from
the official books and records in the officers' custody or are otherwise
known to them. All such certified copies, certificates and affidavits,
including any heretofore furnished, constitute representations of the
city as to the correctness of the facts recited therein and the action
stated therein to have been taken.
This ordinance shall take effect and be in force 30 days from and after
its passage and publication.
OF PURPOSE: This ordinance authorizes the issuance of general
obligation revenue bonds in the amount of $2,486,000 for improvements
to the municipal water utility plant in the Morgan Park neighborhood and
are payable primarily from net revenues of the municipal water utility.