ORDINANCE NO. 051163
Amending ordinances in connection
with certain outstanding State Revolving Fund Program Bonds of the City and
prescribing related matters.
WHEREAS, the City of Kansas City, Missouri (the City) is
a constitutional charter city, organized and existing under the constitution
and laws of the State of Missouri; and
WHEREAS, the City now owns and operates a revenue producing sewerage system, consisting of
sanitary sewers, stormwater sewers and combined sewers, serving the City, its
inhabitants and others within its service area, including connected and
related appurtenances and facilities and extensions, improvements, additions
and enlargements made or acquired by the City
after the date of this Ordinance (the Combined System); and
WHEREAS,
the City has made extensions and improvements to the sanitary sewer portion of
the Combined System (the Sanitary Sewer System); and
WHEREAS,
the City is authorized under the provisions of Chapter 250 of the Revised
Statutes of Missouri (the Act), to issue and sell revenue bonds for the
purpose of paying all or part of the cost of extending and improving the
Sanitary Sewer System serving the City and its inhabitants; and
WHEREAS,
in order to provide for the most cost effective financing of certain extensions
and improvements to the Sanitary Sewer System the City has participated in the
Missouri Leveraged State Water Pollution Control Revolving Fund Program (the
SRF Program) of the Missouri Department of Natural Resources (DNR) and the
State Environmental Improvement and Energy Resources Authority (the
Authority) pursuant to the Act by the issuance of the Citys:
(i) Sewerage System Revenue
Bonds (State Revolving Fund Program) Series 1998A, dated April 1, 1998, in the
original principal amount of $9,200,000 (the Series 1998A Bonds), authorized
by Ordinance No. 980253 passed on March 26, 1998 and Ordinance No. 980417
passed on April 9, 1998 (collectively, the Series 1998A Bond Ordinance); and
(ii) Sanitary Sewer System
Revenue Bonds (State Revolving Fund Program) Series 2002J, dated October 1,
2002, in the original principal amount of $10,000,000 (the Series 2002J
Bonds), authorized by Ordinance No. 021206
passed on October 10, 2002 and Ordinance No. 021304 passed on October 24, 2002 (the Series 2002J Bond Ordinance); and
WHEREAS, pursuant to the SRF Program the Authority
has purchased:
(i) the Series 1998A Bonds
with proceeds of the Authoritys Water Pollution Control and Drinking
Water Revenue Bonds (State Revolving Funds Programs - Master Trust) Series 1998A
(the Series 1998A Authority Bonds), issued pursuant to the Bond Indenture
dated as of April 1, 1998, as amended (the Series 1998A Indenture), by and
between the Authority and UMB Bank & Trust, N.A. (successor to State Street
Bank and Trust Company of Missouri, N.A., as trustee, the Series 1998A
Trustee); and
(ii) the Series 2002J Bonds
with the proceeds of the Authoritys Water Pollution Control and
Drinking Water Revenue Bonds (State Revolving Funds Programs - Master Trust) Series 2002B (the Series 2002B Authority Bonds), issued
pursuant to the Bond Indenture dated as of November 1, 2002, as amended (the
Series 2002B Indenture), by and between the Authority and UMB Bank, N.A., as
trustee (the Series 2002B Trustee); and
WHEREAS,
the Council of the City finds and determines that it is in the best interests
of the City to obtain the benefit of the net interest savings relating to the
refunding of certain Series 1998A Authority Bonds and Series 2002B Authority
Bonds and to amend the Series 1998A Bond Ordinance and the Series 2002J Bond
Ordinance in order to provide for the credit of net interest savings resulting
from the refunding of the Series 1998A Authority Bonds and Series 2002B
Authority Bonds to the payments on the Series 1998A Bonds and the Series 2002J
Bonds, to further amend the Series 1998A Ordinance and the Series 2002J Bond
Ordinance as requested by the Authority and DNR in connection with the issuance
of the Authority Refunding Bonds (defined below), and to provide for certain
other matters; NOW, THEREFORE,
BE IT ORDAINED BY THE
COUNCIL OF KANSAS CITY:
Section
1. Series 1998A Bond Ordinance Amendments. Subject to the
requirement of paragraph (e) of Section 101A below, in consideration of the
Citys receipt of the net savings resulting from the refunding of certain
Series 1998A Authority Bonds and in order to provide for the proper credit of
investment earnings to be received by the City pursuant to the Citys
participation in the SRF Program under the Series 1998A Bond Ordinance No.
980253 and Ordinance No. 980417 are amended enacting a new section, to be
inserted after Section 101 in each ordinance, and to read as follows. Terms
not otherwise defined in this Section have the meanings set forth in the Series
1998A Bond Ordinance.
Section
101A. Definitions of Words and Terms. In addition to the words and
terms defined in Section 101 and elsewhere in this Ordinance, the following
capitalized words and terms as used in this Ordinance shall have the following
meanings:
Authority Refunding Bonds means the Water
Pollution Control and Drinking Water Refunding Revenue Bonds (State
Revolving Funds Programs) Series 2005B of the Authority.
Authority
Refunding Bonds Trustee means the bond trustee with respect to the Authority
Refunding Bonds, and its successors and assigns.
(b) Optional Redemption.
(i) The Director of Finance is
authorized and directed to provide written instructions to the Trustee
directing the optional redemption of the Series 1998A Authority Bonds allocable
to the City which are being refunded by the Authority (the Series 1998A Refunded
Authority Bonds). The initial schedule of the Series 1998A Refunded Authority
Bonds is set forth in Schedule 1. The Director of Finance is authorized
to approve a final schedule of Series 1998A Refunded Authority Bonds and
authorize the Authority to redeem the Series 1998A Refunded Authority Bonds on
the redemption date for the Series 1998A Refunded Authority Bonds as designated
by the Authority. The signature of the Director of Finance to a certificate to
which the final schedule of Series 1998A Refunded Authority Bonds is attached
will be conclusive evidence of approval of the final schedule.
(ii) The City irrevocably and
unconditionally waives its right to optionally redeem Bonds maturing or subject
to mandatory sinking fund redemption on the dates and in the principal amounts
corresponding to the Series 1998A Refunded Authority Bonds (the Non-refundable
Bonds). The initial schedule of the Series 1998A Non-refundable Bonds is set
forth in Schedule 2. The Director of Finance is authorized to approve a
final schedule of Series 1998A Non-refundable Bonds. The signature of the
Director of Finance to a certificate to which the final schedule of Series
1998A Non-refundable Bonds is attached will be conclusive evidence of approval
of the final schedule.
(iii) The City will not exercise
its right to optionally redeem any other Bonds without the prior written
consent of the Authority, which consent is not to be unreasonably withheld and
is conditioned upon a determination by the Authority that such redemption would
not adversely affect the timely payment of the principal of and interest on the
portion of the Authority Refunding Bonds allocable to the Series 1998A Refunded
Authority Bonds.
(iv) Sections 203A, 302 and 904
of the Series 1998A Bond Ordinance, including the provisions relating to
authorized denominations of the Bonds, which will be integral multiples of $1,
are amended in accordance with this subsection (b).
(c) Application of Moneys in Funds and
Accounts. Section 602(a)(2)(A) of the Series 1998A Bond Ordinance is
amended by deleting clauses (I) and (II) and inserting in lieu thereof the
following:
(I) upon
the Citys receipt of the Trustees semiannual notice of the balances remaining
in the Debt Service Account and the Interest Account as of the Business Day
following the transfer by the Trustee to the Authority Refunding Bonds Trustee
pursuant to the Indenture, an amount equal to the balances will be credited in
equal installments against the monthly deposits due prior to the next Interest
Payment Date; and
(II) upon the Citys receipt of the
Trustees semiannual notice of (a) projected investment earnings in the Reserve
Account for the current Interest Period and (b) actual investment earnings in
the Construction Account and the Reserve Account (less the earnings in the
Reserve Account projected pursuant to subclause (a)) for the prior Interest
Period, an amount equal to the projected earnings and actual earnings will be
credited in equal installments against the monthly deposits due prior to the
next Interest Payment Date; and
(d) Parity
Lien Bonds. Section 904 of the Series 1998A Bond Ordinance is amended and
restated to read as follows:
Section
904. Refunding Bonds. The City
may, without complying with the provisions of Section 902, refund any of
the Bonds in a manner which provides debt service savings to the City, and the refunding bonds so issued
will be on a parity with any of the Bonds that are not refunded and any
Outstanding Parity Bonds. If the Bonds are refunded in part and the refunding
bonds bear a higher average rate of interest or become due on a date earlier
than that of the Bonds which are refunded, the City must obtain the prior written consent of the Bondowner and
DNR to the issuance of the refunding bonds.
Nothing in this Section (1)(d) will
be deemed to modify the limitations of Section 1(b) of this Ordinance.
(e) Savings
Requirement. The provisions of this Section 1 are subject to the
requirements of this paragraph (e). The amendments under this Section 1 take
effect upon notice to the Council from the Director of Finance that she has
received evidence (in form and substance satisfactory to her) that the present
value of the debt service savings to the City resulting from the refunding of
the Series 1998A Refunded Authority Bonds is not less than 3.0% of the
aggregate principal amount of the Series 1998A Refunded Authority Bonds. The
present value of the debt service savings to the City will be calculated as the
sum of the present values, as of the expected delivery date of the Authority
Refunding Bonds, of all payments to be credited to the City under the Series
1998A Indenture as a result of the refunding, using a discount rate equal to
the yield on the Authority Refunding Bonds calculated in accordance with
Section 148 of the Internal Revenue Code (the arbitrage yield), a 360-day
year consisting of twelve 30-day months and semiannual compounding.
Section
2. Series 2002J Bond Ordinance Amendments. Subject to the
requirement of paragraph (d) of Section 101A below, in consideration of the
Citys receipt of the net savings resulting from the refunding of certain
Series 2002B Authority Bonds and in order to provide for the proper credit of
investment earnings to be received by the City pursuant to the Citys
participation in the SRF Program under the Series 2002J Bond Ordinance No.
021206 and Ordinance No. 021304 are amended by enacting a new section to be
inserted after Section 101 in each ordinance, and to read as follows. Terms
not otherwise defined in this Section have the meanings set forth in the Series
2002J Bond Ordinance.
Section
101A. Definitions of Words and Terms. In addition to the words and
terms defined in Section 101 and elsewhere in this Ordinance, the following
capitalized words and terms as used in this Ordinance shall have the following
meanings:
Authority Refunding Bonds means the Water
Pollution Control and Drinking Water Refunding Revenue Bonds (State
Revolving Funds Programs) Series 2005B of the Authority.
Authority
Refunding Bonds Trustee means the bond trustee with respect to the Authority
Refunding Bonds, and its successors and assigns.
(b) Optional Redemption.
(i) The Director of Finance is
authorized and directed to provide written instructions to the Trustee
directing the optional redemption of the Series 2002B Authority Bonds allocable
to the City which are being refunded by the Authority (the Series 2002B Refunded
Authority Bonds). The initial schedule of the Series 2002B Refunded Authority
Bonds is set forth in Schedule 1. The Director of Finance is authorized
to approve a final schedule of Series 2002B Refunded Authority Bonds and
authorize the Authority to redeem the Series 2002B Refunded Authority Bonds on
the redemption date for the Series 2002B Refunded Authority Bonds as designated
by the Authority. The signature of the Director of Finance to a certificate to
which the final schedule of Series 2002B Refunded Authority Bonds is attached
will be conclusive evidence of approval of the final schedule.
(ii) The City irrevocably and
unconditionally waives its right to optionally redeem Bonds maturing or subject to mandatory sinking fund
redemption on the dates and in the principal amounts corresponding to the
Series 2002B Refunded Authority Bonds (the Series 2002J Non-refundable
Bonds). The initial schedule of the Series 2002J Non-refundable Bonds is set
forth in Schedule 2. The Director of Finance is authorized to approve a
final schedule of Series 2002J Non-refundable Bonds. The signature of the
Director of Finance to a certificate to which the final schedule of Series
2002J Non-refundable Bonds is attached will be conclusive evidence of approval
of the final schedule.
(iii) The City will not exercise
its right to optionally redeem any other Bonds without the prior written consent of the Authority, which consent is
not to be unreasonably withheld and is conditioned upon a determination by the
Authority that such redemption would not adversely affect the timely payment of
the principal of and interest on the portion of the Authority Refunding Bonds
allocable to the Series 2002B Refunded Authority Bonds.
(iv) Sections 203A, 302 and 904
of the Series 2002J Bond Ordinance, including the provisions relating to
authorized denominations of the Series 2002J Bonds, which will be integral
multiples of $1, are amended in accordance with this subsection (b).
(v) In addition to the current
obligation of the City to pay to the Series 2002B Trustee arbitrage rebate and,
if the City fails to calculate arbitrage rebate, the costs of calculating
arbitrage rebate in connection with the Series 2002B Authority Bonds, the City
will pay to the Series 2002B Trustee and the Authority Refunding Bonds Trustee,
as appropriate, arbitrage rebate and, if the City fails to make the appropriate
calculations, the extraordinary expenses incurred by the Series 2002B Trustee
and the Authority Refunding Bonds Trustee in connection with the calculation of
arbitrage rebate which results from any remaining balance in the Citys
Construction Account held under the Series 2002B Indenture as of January 1,
2006.
(c) Application
of Moneys in Funds and Accounts. Section 602(a)(2)(A) of the Series 2002J
Bond Ordinance is amended by deleting clauses (I) and (II) and inserting in
lieu thereof the following:
(I) upon
the Citys receipt of the Trustees semiannual notice of the balances remaining
in the Debt Service Account and the Interest Account as of the Business Day
following the transfer by the Trustee to the Authority Refunding Bonds Trustee
pursuant to the Indenture, an amount equal to the balances will be credited in
equal installments against the monthly deposits due prior to the next Interest
Payment Date; and
(II) upon the Citys receipt of the
Trustees semiannual notice of (a) projected investment earnings in the Reserve
Account for the current Interest Period and (b) actual investment earnings in
the Construction Account and the Reserve Account (less the earnings in the
Reserve Account projected pursuant to subclause (a)) for the prior Interest
Period, an amount equal to the projected earnings and actual earnings will be
credited in equal installments against the monthly deposits due prior to the
next Interest Payment Date; and
(d) Savings
Requirement. The provisions of this Section 2 are subject to the
requirements of this paragraph (d). The amendments under this Section 2 will
take effect upon notice to the Council from the Director of Finance that she
has received evidence (in form and substance satisfactory to her) that the
present value of the debt service savings to the City resulting from the
refunding of the Series 2002B Refunded Authority Bonds is not less than 3.0% of
the aggregate principal amount of the Series 2002B Refunded Authority Bonds.
The present value of the debt service savings to the City will be calculated as
the sum of the present values, as of the expected delivery date of the
Authority Refunding Bonds, of all payments to be credited to the City under the
Series 2002B Indenture as a result of the refunding, using a discount rate
equal to the yield on the Authority Refunding Bonds calculated in accordance
with Section 148 of the Internal Revenue Code (the arbitrage yield), a
360-day year consisting of twelve 30-day months and semiannual compounding.
Section
3. Further Authority. The City shall, and the Mayor, the City
Clerk and the Director of Finance are hereby authorized and directed to, take
such further action, and execute such other documents, certificates and
instruments as may be necessary or desirable to carry out and comply with the
intent of this Ordinance.
Section 4. Effective Date.
This Ordinance will take effect and
be in full force and effect ten days after its passage.
_____________________________________________
Approved
as to form and legality:
___________________________________
Heather
A. Brown
Assistant City Attorney
SCHEDULE 1
INITIAL SCHEDULE OF SERIES 1998A REFUNDED AUTHORITY BONDS
(KANSAS CITY SERIES
1998A)
Maturity
Date Principal Amount
|
January 1, 2013
|
$ 775,000
|
|
January 1, 2019
|
3,290,000
|
|
|
|
INITIAL SCHEDULE OF SERIES 2002B
REFUNDED AUTHORITY BONDS
(KANSAS CITY SERIES 2002J)
Maturity
Date Principal Amount
|
July 1, 2015
|
$400,000
|
|
July 1, 2016
|
430,000
|
|
July 1, 2017
|
455,000
|
|
July 1, 2018
|
485,000
|
|
July 1, 2019
|
515,000
|