HomeMy Public PortalAbout1967.08.07 Regular Meeting Minutes ..
McCall, Idaho
August 7 , 1967
The City Council of the City of McCall, Valley County, Idaho,
met in regular public session at the regular meeting place of
the council in the City Hall in the City of McCall at 8 :00 o 'clock
P .M. on August 7 , 1967. The roll was called and the following
found to be present :
Sizemore , Mayor
Archer , Councilman
Braden , Councilman li
Schaufelberger , Councilman
Councilman
Absent : Mason
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There was also present William A. Kirk , City Clerk.
After the meeting had been duly called to order and the
minutes of the preceding meeting read and approved, the following
ordinance was introduced in written form by Braden
and was read by title . Councilman Archer moved that the
rule requiring the reading of the ordinance three different days be
dispensed with and the motion was adopted by the vote of not less
than three-fourths of the Council, to-wit :
Aye: Archer , Councilman
Braden , Councilman
Schaufelberger , Councilman
Councilman
Nay: None.
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The ordinance was thereupon read three times by title and
was read in full, after which, pursuant to motion made by Braden
and seconded by Archer , the ordinance was adopted by the
following vote :
Aye: Archer , Councilman
Braden , Councilman
Schaufelberger , Councilman
Councilman
Nay: None.
The ordinance was thereupon signed by the Mayor in evidence
of his approval, was attested by the City Clerk, was ordered recorded,
and is as follows :
ORDINANCE NUMBER 267
AN ORDINANCE authorizing the issuance of $380,000
Sewer Revenue Bonds of the City of McCall for the
purpose of providing funds with which to improve
and extend the sewerage system of said city, the
whole to constitute and be operated as a single
public utility, providing for the payment of such
bonds and the sale and delivery thereof, and making
certain covenants and agreements with respect to the
security and payment for such bonds .
WHEREAS the City of McCall now owns and operates a revenue
producing public utility consisting of a sewerage system and desires
to make improvements and extensions thereto and to finance the
acquisition and construction of such improvements and extensions
through the issuance of revenue bonds of the city, pursuant to the
provisions of the Revenue Bond Act of the State of Idaho; and
WHEREAS the revenues to be derived by said city from the
operation of said system have not been heretofore. pledged or
hypothecated in any manner or for any purpose except for the payment
.of principal of and interest on $60,000 Sewer Revenue Bonds,
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Series June 1, 1955, dated June 1, 1955, which bonds bear interest
at 3 % °� per annum, and of which bonds numbered 3 to 60 ,
inclusive, aggregating 307000.00 , maturing June 1, 1968 to
June 1, 1975, inclusive, are outstanding, which bonds enjoy a prior
and paramount lien on the revenues of the said system; and
WHEREAS in order to pay the cost of making the aforementioned
extensions and improvements the City of McCall desires to issue its
Sewer Revenue Bonds in the amount of $380,000, which bonds shall
enjoy a lien on the revenues of said system which shall be junior
and subordinate to that pledged to the aforesaid Sewer Revenue Bonds,
Series June 1, 1955; and
WHEREAS pursuant to Ordinance Number 263 adopted by the
City Council of the City of McCall on May 1, 1967, a special election
was held in said city on June 6, 1967, at which election the
following question was approved by a two-thirds majority of the
qualified electors voting at said election:.
QUESTION: Shall the City of McCall,
Idaho issue and sell its revenue
bonds to the amount of $380,000
for the purpose of providing funds
with which to improve and extend
the sewerage system of said city
by the acquisition, construction
and purchase of sewerage collection
facilities, a sewerage treatment
plant, including a site or sites
therefor, the whole to constitute
and be operated as a single public
utility, as more fully provided
in Ordinance Number 263 adopted
on May 1, 1967?
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and
WHEREAS Section 57-227, Idaho Code, 1947, provides that
bonds may be sold to the United States Government or to any depart-
ment, corporation or agency thereof or to any department, corporation,
agency or body created, organized or existing under or pursuant to
any. act of Congress, by private sale without giving any prior notice
thereof by publication or otherwise and in such manner as the govern-
ing authority of the issuer may provide; and
WHEREAS the Council of said city has found and determined,
and does hereby find and determine, that it is necessary and for the
best interests of the city and the inhabitants thereof that said
bonds be sold and delivered to the Farmers Home Administration of
the United States Department of Agriculture for a price of not less
than par and accrued interest to the date of delivery, and bearing
interest at the rate of 3-3/4% per annum; and
WHEREAS the City of McCall now desires to provide for the
issuance of such bonds in the manner and for the purposes specified
in said Ordinance Number 263 and pursuant to the provisions of the
Revenue Bond Act, and to confirm the sale of such bonds to said
Farmers Home Administration;
NOW, THEREFORE, Be it ordained by the mayor and council of
the City of McCall, Valley County, Idaho, as follows :
Section 1. That as used herein the following terms shall
have the meanings indicated unless the context otherwise clearly
requires :
(a) "City" means the City of McCall, Valley County,
Idaho.
(b) "Sewerage system" shall mean the same as is
provided in the Revenue Bond Act (Chapter 47, General
Laws of Idaho, 1951, as amended by sections 187 to
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202 of House Bill No. 3, as amended, of the Thirty-Nrith
Session of the Legislature of the State of Idaho) , and
as used herein shall apply to the facilities of the city
coming within said definition.
(c) "System" means the combined public utility
comprising the sewerage system of the city and, if and
when acquired, the sewerage treatment plant of said city as
they now and may hereafter exist and be acquired, improved
and extended while any of the bonds or parity bonds re-
main outstanding, including all improvements, additions
and extensions made thereto and including all real and
personal property of every nature owned by the city and
used or useful in the operation thereof, whether within
or without the boundaries of the city.
(d) "Bonds" means the bonds herein authorized. As
used in Sections 5, 7 to 9, inclusive, 11 and 12 hereof
said term includes parity bonds.
(e) "Prior lien bonds" means the now outstanding
30, 000.00 Village of McCall Sewer Revenue Bonds,
Series 1955, which enjoy a prior and paramount lien on
and pledge of the revenues of the system, as such bonds
are more fully described in the preamble hereto.
(f) "Parity bonds " means obligations issued on a
parity with the bonds herein authorized under the pro-
visions of Section 9 hereof .
(g) "Revenue Bond Act" means Chapter 47, General
Laws of Idaho, 1951, as amended by Sections 187 to 202
of House Bill No. 3, as amended, of the Thirty-Ninth
Session of the Legislature of the State of Idaho.
(h) "Revenues" means all revenue or income derived
directly or indirectly from the sale of services supplied
by the system and from the use and operation of the system,
including but without limitation interest received on
invested money and profits realized from the sale of
investments made with the revenues of the system.
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(i ) "Cost of maintenance and operation" means all
costs reasonably incurred in connection with the mainte-
nance and operation of the system, including repairs and
renewals (other than capital improvements) necessary to
keep the system in efficient operating condition, the
cost of audits -hereinafter required, the paying agent 's
fees, payment of premiums for the insurance hereinafter
required to be carried on the system, and, generally,
all expenses (exclusive of depreciation) which under
general accounting practices are properly chargeable to
maintenance and operation; in every instance, however,
only such expenses as are reasonably and properly neces-
sary to the efficient maintenance and operation of the
system shall be included .
W "Net revenues" means the revenues after de-
duction therefrom of the cost of maintenance and operation.
(k) "Fiscal year" means the twelve months period
beginning June 1 and ending on the next succeeding
May 31 .
(1) "Depositary" means The Idaho First National Bank
in the City of McCall., Idaho. If such bank shall become
unable longer to carry out its duties as Depositary, the
city shall select a successor Depositary, which successor
Depositary shall be a bank having capital and surplus of
not less than $ 330, 000.00 at the time of such appointment;
similar successor Depositaries may be appointed thereafter
from time to time as such appointment becomes necessary. Such
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successor Depositary shall not replace the original
Depositary as paying agent for the bonds but shall
replace the original Depositary as depositary of the
funds hereinafter created and required to be held by
the Depositary and there shall be paid over to each such
successor Depositary by its predecessor Depositary all
money, funds and other property of every nature then held
by such predecessor Depositary under the provisions of
this ordinance. Any successor Depositary shall make such
arrangement with the paying agent bank as will assure
prompt payment of maturing bonds and interest coupons
when due to the extent of available funds .
Section 2. That for the purpose of providing funds with
which to improve and extend the sewerage system of said city by the
acquisition, construction and purchase of sewerage collection facil-
ities, a sewerage treatment plant, including a site or sites therefor,
the whole to constitute and be operated as a single public utility,
including the payment of incidental engineering, inspection, legal and
fiscal costs, there shall be borrowed upon the credit of the revenues
of the system the sum of $380,000 .
In evidence of the sum to be so borrowed, there shall be
issued the Sewer Revenue Bonds of said city pursuant to the provisions
of the Revenue Bond Act hereinafter referred to.
Section 3. That such bonds shall be designated "Sewer
Revenue Bonds ", shall be in the total principal amount of $380,000,
shall be dated Jtne 1, 1967, shall be in the denomination of $1,000
each, shall be numbered 1 to 380, inclusive, and shall bear interest
at the rate of three and three-fourths per cent (3-3/4%) per annum,
payable on Jane 13 1968 and semi-annually thereafter m the first
days of June and December of each year. The bonds shall be payable
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as to both principal and interest in lawful money of the United States
of America at the office of the City Treasurer of the City of McCall,
Idaho, or at the option of the holder thereof at The Idaho First
National Bank , in the City-of McCall , Idaho, and shall
mature serially in numerical order on June 1 of each of the years as
follows:
Bond Numbers Amount Year
1 to 7 $ 7,000 1969
8 to 15 8,000 1970
16 to 23 8,000 1971
24 to 31 8,000 1972
32 to 40 9,000 1973
41 to 49 93000 1974
50 to 58 9,000 1975
59 to 68 lo,00q 1976
69 to 78 105000 1977
79 to 88 10,000 1978
89 to 99 113000 1979
100 to 110 11,000 1980
111 to 122 12,000 1981
123 to 134 12,000 1982
135 to 147 13,000 1983
148 to 16o 13,000 1984
161 to 174 14,000 1985
175 to 188 14,000 1986
189 to 202 14,000 1987
203 to 217 15,000 1988
218 to 233 16,000 1989
234 to 249 16,000 1990
250 to 266 17,000 1991
267 to 283 17,000 1992
284 to 301 18,000 1993
302 to 320 19,000 1994
321 to 339 19,000 1995
34o to 359 20,000 1996
360 to 380 21,000 1997
All of said bonds shall be callable for redemption at the
option of- the city in inverse numerical order on June 1, 1975 and
on any interest payment date thereafter at the principal amount
thereof and accrued interest to the date fixed for redemption.
Notice of redemption shall be given not less than thirty days prior
to the date fixed for redemption by filing with the paying agent
bank, and by publication of an appropriate notice one time in a
financial newspaper or journal published in the City of New York,
New York.
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Section 4. That said bonds shall be signed by the Mayor,
shall be countersigned by the City Treasurer, shall be attested by
the City Clerk, and shall have impressed thereon the official seal
of the City of McCall. Interest accruing on said bonds on and prior
to maturity shall be evidenced by coupons to be thereto attached,
which coupons shall be signed by the City Treasurer by his facsimile
signature and said Treasurer by the execution of said bonds shall
adopt as and for his own proper signature his facsimile signature
on said coupons .
Section 5. That the bonds shall not be payable from or
charged upon any funds of the City of McCall other than the revenues
to be derived from the operation of the system, nor shall the City
of McCall ever be subject to any liability thereon. No holder or
holders of any of the bonds shall ever have the right to compel any
exercise of the taxing power of the City of McCall to pay any of the
bonds or interest thereon or to enforce payment thereof against any
property of the city and such bonds shall not constitute a charge,
lien or encumbrance, legal or equitable, upon any property of the
city, other than the revenues received from the operation of the
system.
Section 6. That the bonds herein authorized and the coupons
to be thereto attached shall be in substantially the following form:
(Form of Bond)
UNITED STATES OF AMERICA
STATE OF IDAHO
COUNTY OF VALLEY
CITY OF MC CALL
SEWER REVENUE BOND
Number $1,000
KNOW ALL MEN BY THESE PRESENTS, that the City of McCall, a
duly organized and existing municipal corporation in Valley County,
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Idaho, for value received hereby promises to pay to bearer, in the
manner and from the funds hereinafter provided, the sum of One Thousand
Dollars ($1,000) on the first day of June, 19_, and to pay interest
on said sum from the date hereof until payment of principal at the rate
of Three and three-fourths per cent (3-3/4%) per annum, payable June 1,
1968 and semi-annually thereafter on the first days of June and December
of each year, interest falling due on and prior to maturity being pay-
able upon presentation and surrender of the annexed interest coupons
as the same severally become due. Both principal of and interest on
this bond are payable in lawful money of the United States of America
at the office of the City Treasurer of the City of McCall, Idaho, or
at the option of the holder hereof at The Idaho First National Bank
in the City of McCall , Idaho.
The bonds of the issue of which this is one are callable for
redemption at the option of the city in inverse numerical order on
June 1, 1975 and on any interest payment date thereafter at the
principal amount thereof and accrued interest to the date fixed for
redemption. Notice of redemption of any bond so called for redemption
is to be given not less than thirty days prior to the date fixed for
redemption by filing with the paying agent bank and by publication of
an appropriate notice one time in a financial newspaper or journal
published in the City of New York, New York.
This bond is one of an is.sue of Three Hundred Eighty Thousand
Dollars ($380,000) , issued by the City of McCall under the provisions.
of the Revenue Bond Act, Chapter 47, General Laws of Idaho, 1951, as
amended by Sections 187 to 202 of House Bill No. 3, as amended, of the
Thirty-Ninth Session of the Legislature of the State of Idaho, for
the purpose of providing funds with which to improve and extend the
sewerage system of said city by the acquisition, construction and
purchase of sewerage collection facilities, a sewerage treatment plant,
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including a site or sites therefor, the whole to constitute and be
operated as a single public utility, and said bonds are payable only
from the income and revenues to be derived from the operation of
the combined public utility comprising the sewerage system -of the
city and, if and when acquired, the sewerage treatment plant of said
city as they now and may hereafter exist and be acquired, improved and
extended after provision has been made for payment therefrom of the
reasonable and necessary expenses of administering, operating and
maintaining said plant and system and of all sums required to be paid
for the benefit of certain outstanding Village of McCall Sewer
Revenue Bonds, Series June 1, 1955, dated June 1, 1955, a portion of
which revenues has been set aside as a special fund identified
as "The City of McCall 1967 Sewer Revenue Bonds Interest and
Sinking Fund", and irrevocably pledged to the payment
of principal of and interest on said bonds. This bond does not
constitute an indebtedness of the City of McCall within the meaning
of any constitutional or statutory limitation of indebtedness, is not
payable from or a charge upon any funds of the City of McCall other
than said "The City of McCall 1967 Sewer Revenue Bonds Int rest and
Sinking Fund", and the City of McCall shall not be subject to any
liability thereon. No holder or holders of this bond shall ever
have the right to compel any exercise of the taxing power of the
City of McCall to pay this bond or interest thereon nor to enforce
payment thereof against any property of the City of McCall, nor shall
this bond constitute a charge, lien or encumbrance, legal or equit-
able, upon any property of the City of McCall, except the net revenues
above mentioned.
The City of McCall has covenanted and hereby covenants and
agrees at all times while this bond, or any bond of the issue of which .
it is a part, is outstanding and unpaid, to fix and maintain such rates
for services furnished by said combined public utility as will be fully
sufficient to provide for the payment of the interest on and principal
of all of said bonds as interest and principal become due, including
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the aforementioned Village of McCall Sewer Revenue Bonds, Series
June 1, 1955, dated June 1, 1955, to create a proper reserve
therefor, and to provide for the payment of the expenses of
maintaining and operating said combined public utility,. .
For a more particular statement of the covenants and provisions
securing the bonds, including the designation of a Depositary, the
conditions under which the holders of 75% of the bonds payable from
said net revenues may consent to modification of the authorizing
ordinance and the conditions under which additional obligations may
be issued on a parity, reference is made to the ordinance adopted
by the Council of said city on August 7 , 1967, authorizing
this issue.
This bond and the issue of which it is a part are issued in
conformity with and after full compliance with the Constitution of
the State of Idaho and pursuant to the provisions of the Revenue Bond
Act, Chapter 47, General Laws of the State of Idaho, 1951, as amended
by Sections 187 to 202 of House Bill No. 3, as amended, of the
Thirty-Ninth Session of the Legislature of the State of Idaho, and
all other laws applicable thereto, after having been authorized by
vote of more than a two-thirds majority of the qualified electors of
the City of McCall at an election held therein on Jut,; 6, 1967.
It is hereby certified, recited and declared that all acts,
conditions and things required to exist, happen and be performed
precedent to and in the issuance of this bond have existed, have
happened and have been performed in due time, form and manner as
required by law, that this bond is by statute made fully negotiable,
and that this bond is exempt from taxation, except transfer and estate
taxes, in the State of Idaho.
IN WITNESS WHEREOF, the City of McCall, Idaho, acting through
its Council, has caused this bond to be signed by its Mayor, counter-
signed by its City Treasurer and attested by its City Clerk under the
official seal of said city, and has caused the interest coupons hereto
attached to be executed by the facsimile signature of said City
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Treasurer, all as of this first day of June, 1967.
Countersigned: Mayor
City Treasurer
Attest:
City Clerk
(Form of Coupon)
Number $
On the first day of 19_, unless the herein-
after mentioned bond is then optional for redemption and has been
properly called for redemption, the City of McCall, Idaho, will pay
to bearer the amount shown hereon in the manner and out of the funds
described in the bond to which this coupon is attached, in lawful
money of the United States of America, at the office of the City
Treasurer of the City of McCall, Idaho, or at the option of the
holder at The Idaho First National Bank ! in the City of McCall 3
Idaho, being interest then due on its Sewer Revenue Bond, dated June 1,
1967 and numbered
City Treasurer
(Registration Certificate)
We, the undersigned City Clerk and City Treasurer of the
City of McCall, Idaho, do hereby certify that the within bond has
been duly registered in permanent public record books kept in our
respective offices for the purpose of such registration, in full
compliance with the provisions of Title 57, Chapter 2, Idaho Code,
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1947, and laws amendatory tho?b of, such registration showing the
number, date, amount of the bond, rate of interest thereon, date of
maturity., places of payment and the number and denomination of the
attached coupons, and the names of the purchasers and date of the
delivery of the bond; and the undersigned City Treasurer does hereby
certify that before the delivery of this bond he received the proper
consideration therefor.
IN WITNESS WHEREOF, we have subscribed our official hands.
City Treasurer
City Clerk
Section 7. PLEDGE OF REVENUES
That the bonds herein authorized shall be fully subordinate
in all respects to the outstanding Village of McCall Sewer Revenue
Bonds, Series June 1, 1955, and so long as any of said prior lien
bonds remain outstanding the provisions of the May 2, 1955 resolution,
as amended, authorizing the issuance of said prior lien bonds shall
control in case of any conflict over the provisions of this
resolution. When all of the said prior lien bonds shall have been
retired the provisions of this resolution shall govern.
Section 8. FLOW OF FUNDS
That so long as any of the bonds remain outstanding, all of
the revenues shall from day to day as collected be continued to be .
deposited with the Depositary in a fund established by the aforesaid
resolution of May 2, 1955, as amended, authorizing the prior lien
bonds, to be kept separate and apart from all other city funds,
which fund shall be hereafter known as the "City of McCall Gross
Income Sewer Fund", sometimes hereinafter referred to as the "Income
Fund", and are hereby pledged for the following purposes and shall be
set aside into the following special funds in the following order of
priority.
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From the money in the Income Fund there shall be first
transferred from time to time to a fund to be held by the Depositary
and known as the "Sewer Operation and Maintenance Fund" such
reasonable percentage of the money in the Income Fund as the Council
shall determine to be necessary for the proper, efficient and
economical operation and maintenance of said system. The
Superintendent or Manager of the system may accumulate as an expense
of maintenance and operation equitable allowances for accruals and
accumulations of accruals of amounts to cover the cost of periodic
payments of maintenance and operation expenses, such as insurance
premiums and expenditures for renewals, replacements and repairs
normally classified as maintenance and operation expenditures,
provided however, any surplus remaining in said operation and
maintenance fund at the end of the fiscal year and not needed for
operation and maintenance purposes, shall be transferred to the
Income Fund and used for the purposes thereof, as herein provided.
Secondly, there shall be transferred from the money in the
Income Fund into the "Village of McCall Sewer Revenue Bond Fund,
Series June 1, 1955" established for the benefit of the prior lien
bonds all necessary sums required to be deposited into said fund
by the provisions of the May 2, 1955 resolution, as amended,
authorizing the issuance of the prior lien bonds.
After there shall have been transferred from the Income
Fund in each month the amounts above required, the City Treasurer
shall on or before the 10th day of each month, transfer to a special
fund, which is hereby created and shall be known as "The City of
McCall 1967 Sewer Revenue Bonds Interest and Sinking Fund"
(hereinafter sometimes called the "Bond Fund"), one-sixth of the
interest due on the bonds on the next succeeding interest payment
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date (except that prior to the payment of the first maturing interest
coupons to be attached to the bonds such additional or greater
payments shall be made as may be necessary to assure the prompt
payment of such interest coupons when due) and, beginning twelve
months before the first principal installment shall fall due,
one-twelfth of the amount of principal of the bonds falling due on
the next succeeding principal payment date.
After the payments above required have been made in each
month, there shall be transferred, beginning in August , 1968,
from the Income Fund into the Bond Fund the sum of $180.97 (or such
greater sum as may be provided in proceedings hereafter adopted
authorizing parity bonds) until there has been accumulated in said
fund the sum of $21,715. 52 in excess of current principal and inter-
est requirements. Such excess shall be held in a separate account in
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the Bond Fund known as the "Reserve Account" and shall be used only
to pay currently maturing principal of and interest on the bonds
whenever and to the extent necessary to prevent a default . Pro-
ceedings authorizing the issuance of parity bonds shall provide
that the rate of accumulation or the amount to which the Reserve
Account is to be accumulated be increased in accordance with the
terms of subparagraph (e) of paragraph 2 of sub-section K of Section
9 hereof . Whenever there is a deficiency in payments into the
Reserve Account or whenever after the initial accumulation of the
full amount required to be accumulated therein the amount in said
fund falls below such required accumulation, such deficiency shall
be made up from the money in the Income Fund whenever and to the
extent such money is not needed for payment of the cost of mainte-
nance and operation and for current principal and interest require-
ments, regardless of the foregoing limitation on monthly payments.
The money in the Bond Fund, including the Reserve Account
when necessary, shall be applied to the payment of currently maturing
principal and interest without further instructions . Whenever there
is sufficient money in the Bond Fund, including the Reserve Account,
to pay principal of and interest on all bonds then outstanding on
the next interest payment date, the money in said fund shall be
applied for such purpose.
SURPLUS REVENUES
All money remaining in the Income Fund in each fiscal
yea r after all payments hereinabove required to be made in
such year have been made and after all deficiencies existing from
previous years have been remedied, shall be regarded as surplus and
may be used by the city for the making of improvements or additions
to the system, for the creation of a special fund to be accumulated
and applied to such purpose, for the payment of principal of and
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interest falling due on general obligation bonds of the city
issued for sewer purposes, for the payment of principal, interest
and redemption premiums on junior lien bonds issued for the making
of improvements and extensions to the system, for the retirement of
bonds payable from the Bond Fund in advance of maturity or for any
other lawful corporate purpose. Any such retirements so made prior
to maturity may be made either through the purchase of bonds on the
open market at the best price or prices obtainable not in excess of
the lowest price at which any bonds payable from the Bond Fund are
then redeemable under their terms, or through the calling of bonds
for redemption pursuant to the right therein reserved.
All money held by the Depositary in the funds above
mentioned shall be held as special and not general deposits,
and all money held in the Bond Fund shall be held as a special
trust fund, the beneficial interest in which shall be in the
holders from time to time of the bonds outstanding. All money
so held in excess of the amount guaranteed by the Federal Deposit
Insurance Corporation shall be secured either (a) by lodging with
the trust department of the Depositary or with some other depositary
approved by the city, as collateral security, direct obligations of
or obligations, the principal and interest of which are uncondi-
tionally guaranteed by the United States of America, or by other
marketable securities eligible as security for the deposit of trust
funds under regulations of the Board of Governors of the Federal
Reserve System, having a market value (exclusive of accrued interest)
at least equal to the amount of such deposit, or (b) in such manner
as may then be required by all applicable state or federal laws and
regulations regarding the security for or granting preference in the
case of the deposit of trust funds .
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Money in the Bond Fund required for the payment of principal
and interest shall at the request of the city be invested in direct
obligations of the United States of America maturing at least fifteen
days prior to the date as of which principal or interest falls due.
Money held in the Reserve Account in the Bond Fund shall at the
request of the city be invested in direct obligations of the United
States of America maturing in not more than ten years from the date
of investment. It shall not be necessary for the Depositary to give
security for the deposit of any money which is so invested. Obliga-
tions so purchased shall be deemed at all times to be a part of the
fund for which the obligations were purchased. Interest accruing
thereon and any profit realized from such investments shall be paid
into the Income Fund. The Depositary shall sell at prevailing
market prices or shall present for redemption any obligations so
purchased whenever it shall be necessary so to do in order to
provide money to meet any payment due from the fund.
Section 9. COVENANTS
That the city covenants and agrees with the successive
holders from time to time of the bonds and the coupons representing
interest thereon, that so long as any of the bonds remain outstand-
ing and unpaid as to either principal or interest :
A . The city will maintain the system in good repair and
working order and will operate it efficiently and will faithfully
and punctually perform all duties with reference to the system
required by the Constitution and Laws of the State of Idaho, and
that it will make and collect sufficient rates and charges for
service furnished by the system and will segregate and apply the
revenues derived therefrom in the manner provided in this ordinance
so that such revenues will at all times be fully sufficient to
operate and maintain the system, and to pay principal of and interest
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on the bonds promptly as principal and interest fall due, and
to make all payments herein required to be made.
B. The city will not permit free use or service of the
system by the city or any department thereof or by any person, firm
or corporation, public or private .
C. The city will cause to be kept proper books of record
and account covering the operation of the system. Such books shall
be kept in accordance with standard accounting practices and proced-
ures customarily used for systems of similar nature. The city will
cause such books to be audited annually by an independent certified
public accountant or firm of public accountants and will annually
within one hundred twenty days after the close of each fiscal year
file with the Depositary at least three copies of said report
accompanied by a certificate by said accountant or firm. Each such
audit, in addition to whatever other matters may be thought proper
by the accountant to be included therein, shall include the following:
1. A statement in detail of the income and expenditures of
the system for such fiscal year.
2 . A balance sheet as of the end of such fiscal year.
3. The accountant 's comments regarding the manner in which
the city has carried out the requirements of this ordinance and the
accountant 's recommendations for any changes or improvements in the
operation of the system.
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4. A list of insurance policies in force at the end of
the fiscal year, setting out as to each policy the amount of the
policy, the risks covered, the name of the insurer and the expir-
ation date of the policy.
5. The number of properties connected with the sewerage
system at the end of the fiscal year.
6. The amount of money in each of the funds created by
Section 8 hereof at the beginning and at the end of the fiscal
year and the amount of money paid. into and expended from each of
said funds during such fiscal year.
7. The total dollar amount billed for sewer service during
the fiscal year and the average monthly billing per sewer customer
for such service.
8. All schedules of rates and charges in effect during such
fiscal year.
The city agrees to furnish a copy of each such audit to the
holder of any of the bonds at his request after the close of each
fiscal year, and that any such holder shall have the right to discuss
with the accountant making the audit the contents of the audit and
to ask for such additional information as he may reasonably require.
Said books of record and account shall be open at all
reasonable times for inspection by the holder or holders of any
of the bonds or the duly authorized attorney or agent for said
bondholder.
D. The city will take out and maintain or otherwise
provide for insurance on the system of the kinds and in the amounts
which are usually carried by private companies operating similar
properties. All moneys received for losses under such insurance
policies, other than public liability policies, are hereby pledged
by the city as security for the bonds until and unless such proceeds
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are paid out or obligated in making good the loss or damage in
respect of which such proceeds are received, either by repairing
the property damaged or replacing the property destroyed. Adequate
provision for making good such loss and damage shall be made within
ninety days from the date of the loss, or, in the event the destroyed
property is no longer useful in the operation of the system, the
proceeds of the insurance shall be deposited in the Income Fund.
E. The city shall not sell, encumber or in any manner
dispose of the system or any substantial part thereof until all
of the bonds and parity bonds have been paid in full as to both
principal and interest, provided that this covenant shall not be
construed to prevent the disposal by the city of property which _
in its judgment has become inexpedient to use in connection with
the system when other property of equal value is substituted
therefor,
F. The city will commence and complete the acquisition
and construction of the facilities and improvements for which the
bonds are herein authorized with all practical dispatch and will
cause all construction to be effected in sound and economical manner.
G. The city will from time to time duly pay and discharge
or cause to be paid and discharged all taxes, assessments and other
governmental charges, if any, lawfully imposed upon the system or
any part thereof or upon the revenues, as well as any lawful claims
for labor, materials or supplies which if unpaid might by law become
a lien or charge upon the system or the revenues .or any part thereof
or which might impair the security of the bonds.
H. The city will not permit nor grant a franchise for the
operation of any competing sewer system in the city.
I. The city in order to assure the efficient management
and operation of the system and to assure the holders from time to ,
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time of the bonds that same will be operated on sound business
principles, will employ competent and experienced management for
the system, will use its best efforts to see that the system is
at all times operated and maintained in first class repair and
condition and in such manner that the operating efficiency thereof
shall be of the highest character, and will use its best efforts
to see that the cost of such maintenance and operation is at no
time in excess of the revenues reasonably available for the payment
thereof.
J. The holders of the bonds from time to time shall be
entitled to exercise all rights and powers for which provision is
made in the Revenue Bond Act, including specifically, if any of the
bonds shall be permitted to default as to principal or interest, the
right to apply to a court of competent jurisdiction to appoint a
receiver for the system who may enter and take possession of the
system, operate and maintain the system, and prescribe charges and
collect, receive and apply the revenues arising therefrom in such
manner as the court may direct and as will assure the carrying out
of all the covenants contained in this ordinance . Such receiver
shall be appointed only when request for such appointment shall have
been made by the holders of not less than forty per cent in principal
amount of the bonds which are then outstanding, or by a trustee
acting in behalf of the holders of such percentage of bonds, and
such request shall be represented by a written instrument or con-
current written instruments signed by such holders and filed with
the application for the appointment of such receiver.
K. The bonds shall enjoy complete parity of lien on the
revenues despite the fact that any of the bonds may be delivered at
an earlier date than any other of the bonds . The city will issue
no other bonds or obligations of any kind or nature payable from or
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enjoying a lien on the revenues having priority over or parity with
the bonds herein authorized, provided however, that bonds may here-
after be issued on a parity with the bonds herein authorized under
the following conditions:
1. The bonds herein authorized or any part thereof or all or
any part of the prior lien bonds may be refunded with the consent of
the holders thereof (except that as to maturing bonds or bonds which
are then optional for redemption and have been properly called for
redemption, such consent shall not be necessary) and the refunding
bonds so issued shall enjoy complete equality of lien with that
portion of the same issue which is not refunded, if any there be, and
the refunding bonds shall continue to enjoy whatever priority of lien
over subsequent issues that may have been enjoyed by the bonds
refunded, provided however, that if only a portion of the outstanding
bonds payable from the revenues of the system is so refunded no
refunding bonds may mature at a date earlier or bear interest at a
rate higher than the corresponding bond refunded thereby, without the
consent of the holders of all unrefunded bonds payable from the
revenues of the system.
2. Additional bonds may also be issued on a parity with
the bonds herein authorized if all of the following conditions are
met:
(a) The net revenues for the completed fiscal year immed-
iately preceding the issuance of the additional bonds must have been
equal to or greater than the highest combined interest and principal
requirements for any succeeding twelve months period on all bonds then
outstanding, and the bonds so proposed to be issued, including the
then outstanding prior lien bonds and the bonds herein authorized.
(b) The payments required to be made into the various
funds hereinabove established must be current and not in default.
(c) The additional bonds must be payable as to principal
on July 1 of each year in which principal falls due and payable as
J to interest on January 1 and July 1 of each year.
(d) The proceeds of the additional bonds must be used
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solely for the making of improvements, extensions, renewals or
replacements to the system, or for the acquisition or construction
of or the making of improvements, extensions, renewals or replace-
ments to a municipal water system.
(e) The proceedings authorizing the additional bonds must
provide that the amount to which the Reserve Account in the Bond
Fund is to be accumulated shall be increased to an amount no less
than the average amount of principal and interest payable from the
Bond Fund in any future twelve month period on the bonds then out-
standing and the additional bonds . Said proceedings must also
require that the rate of accumulation of said Reserve Account be
increased if and as necessary to achieve the full required accumul-
lation in one hundred twenty months from the issuance of said parity
bonds. -
L. So far as it legally may, and to the extent that the
city may from time to time own and operate a municipal water system,
the city agrees that it will bill each customer receiving both water
and sewer service in a single bill, will refuse to accept payment
for water service unless payment for sewer service is also made,
and if payment for sewer service is permitted to become delinquent
and remain so for a period of sixty days, will discontinue the
service of water to any premises the owner or occupant of which
shall be so delinquent, and will not re-commence the supply of
water to such premises until all delinquent sewer charges with
penalties shall have been paid in full. The city will do all things
and exercise all remedies legally available to assure the prompt
payment of charges for all service supplied by the system.
M. The city will require the owner, tenant or occupant of
each lot or parcel of land in the city upon which a building shall
have been constructed for residential, commercial or industrial use
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within 300 feet,measured along an accessible route, of any sanitary
sewer line to connect such building with the sewerage collection
system of said city and to cease to use any other method for the
disposal of sanitary or industrial sewage. If within a period
of 15 days after the owner of any such lot or parcel shall have
been notified to make such sewer connection, such connection is
not made, the city will discontinue the service of water to such
lot or parcel and will not re-commence supplying water thereto until
such sewer connection shall have been made.
N. In addition to all other rights enjoyed by the holders
of the bonds and parity bonds, such holders shall have the right by
mandamus or other appropriate suit or action in any court of competent
jurisdiction to enforce his or their rights against the city, the
governing body thereof, and any officers, officials and agents
thereof, including, but without limitation, the right to require
the city and its governing body to fix and collect rates and charges
fully adequate to carry out all of the provisions and agreements
contained in this ordinance.
0. All payments falling due on the bonds and parity bonds
for principal and interest shall be made to the holders thereof at
par and all charges made by the paying agent bank shall be paid by
the city.
Section 10 . SALE OF BONDS AND APPLICATION OF PROCEEDS
That the bid of the Farmers Home Administration of the
United States Department of Agriculture for the purchase of the
bonds herein authorized be and the same is hereby accepted, and
that said bonds shall be delivered to said purchaser as soon as
may be after the adoption of this ordinance pursuant to due pay-
ment therefor in accordance with the terms of the sale. The sale
of said bonds to said purchaser at par and accrued interest to the
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date of delivery is hereby in all respects ratified and confirmed.
All accrued interest received from the purchaser of the
bonds shall be paid into the Bond Fund. So much of the remainder
of such proceeds as is not required for the payment of engineering,
inspection, legal, fiscal and other incidental costs due and owing
at the time of the issuance of the bonds shall be held in a special
Construction Account and paid out solely for the purposes for which
the bonds were voted and are herein authorized and until so paid
shall be subject to a lien and charge in favor of the holders of
the bonds outstanding at any time and shall be held for the further
security of such bonds until so paid out. When all work to be paid
for with the proceeds of the bonds shall have been completed and all
amounts due therefor shall have been paid, the balance, if any,
remaining in such Construction Account shall be transferred to the
Bond Fund and first credited to the Reserve Account therein to the
extent necessary to bring the Reserve Account up to its full required
amount of $21,715.52. Such transfer shall not decrease the amounts
hereinabove otherwise required to be paid into such fund, but if
the amount so available to be paid into the Bond Fund will cause
the amount in the Bond Fund, including the Reserve Account therein,
to exceed the sum of $21,715.52 plus all principal and interest
payable therefrom during the next succeeding twelve months, such
excess shall be used either for the retirement of bonds or the making
of improvements and extensions to the system. Money in such Con-
struction Account shall be secured as hereinabove provided for the
securing of money in the Bord Fund but may be invested in direct
obligations of the United States of America maturing not later than
,August 7 9 1968.
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Section 11. SCHEDULE OF RATES AND CHARGES
That the schedule of rates and charges to be imposed for
sewer service rendered by the system shall, commencing January 1 ,
1968 , be as set out in an ordinance or ordinances which shall have
been adopted prior to the issuance of any bonds hereunder.
Said schedule of charges shall be considered a minimum while
any of the bonds remain outstanding, and shall be subject to such
increase from time to time as may be necessary to permit full com-
pliance with all the provisions and requirements of this ordinance,
but shall be subject to reduction only when and to the extent that
the revenues available for payment into the Bond Fund in each of the
two immediately preceding fiscal years shall have exceeded one and
one-half times the total principal and interest payable from said
fund during each such respective preceding fiscal year.
Section 12. MODIFICATION
That the provisions of this ordinance shall constitute a
contract between the city and the holders from time to time of the
bonds (including parity bonds) and after the issuance of any of the
bonds, no change, variation or alteration of any kind in the pro-
visions of this ordinance may be made except as follows:
The holders of seventy-five per cent in principal amount
of the, bonds at any time outstanding (not including in any case any
bonds which may then be held or owned by or for the account of the
city, but including such refunding bonds as may be issued for the
purpose of refunding any of the bonds and are not owned by the city)
shall have the right from time to time to consent to and approve the
adoption by the city of an ordinance or ordinances modifying or
amending any of the terms or provisions contained in this ordinance,
provided however, that this ordinance may not be so modified or
amended in such manner as to:
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(a) Make any change in the maturity of the bonds .
(b) Make any change in the rate of interest borne by any
of the bonds .
(c) Reduce the amount of the principal payable on the
bonds .
(d) Modify the terms of payment of principal or of inter-
est on the bonds or any of them or impose any conditions with re-
spect to such payment.
(e) Affect the rights of the holders of fewer than all of
the bonds then outstanding.
Whenever the city shall propose to amend or modify this
ordinance under the provisions of this section, it shall cause notice
of the proposed amendment to be published one time in a financial
newspaper or journal published in the City of . New York, New York, or
Chicago, Illinois . Such notice shall briefly set forth the nature of
the proposed amendment and shall state that a copy of the proposed
amendatory ordinance is on file in the office of the City Clerk for
public inspection.
Whenever at any time within one year from the date of the
publication of said notice there shall be filed in the office of said
Clerk an instrument or instruments executed by the holders of at
least seventy-five per cent in aggregate principal amount of the
bonds then outstanding as in this section defined, which instrument
or instruments shall refer to the proposed amendatory ordinance
described in said notice and shall specifically consent to and
approve the adoption thereof, thereupon, but not otherwise, the
City Council may adopt such amendatory ordinance and such ordinance
shall become effective.
If the holders of at least seventy-five per cent in
aggregate principal amount of the bonds as in this section defined,
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at the time of the adoption of such amendatory ordinance, or the
.y .
predecessors in title of such holders, shall have consented to and
approved the adoption thereof as herein provided, . no holder of any
bond, whether or not such holder shall have consented to or shall
have revoked any consent as in this section provided, shall have
any right or interest to object to the adoption of such amendatory
ordinance or to object to any of the terms or provisions therein
contained or to the operation thereof or to enjoin or restrain the
city from taking any action pursuant to the provisions thereof .
Any consent given by the holder of a bond pursuant to the
provisions of this section shall be irrevocable for a period of six
months from the date of the publication of the notice above provided
for and shall be conclusive and binding upon all future holders of
the same bond during such period . Such consent may be revoked at
any time after six months from the date of the publication of such
notice by the holder who gave such consent or by a successor in title
by filing notice of such revocation with said City Clerk, but such
revocation shall not be effective if the holders of seventy-five
per cent in aggregate principal amount of the bonds outstanding as
in this section defined have prior to the attempted revocation
consented to and approved the amendatory ordinance referred to in
such revocation.
The fact and date of the execution of any instrument under
the provisions of this section may be proved by the certificate of
any officer in any jurisdiction who by the laws thereof is author-
ized to take acknowledgments of deeds within such jurisdiction, that
the person signing such instrument acknowledged before him the
execution thereof, or may be proved by any affidavit of a witness
to such execution sworn to before such officer . The amount and
numbers of the bonds held by any person executing such instrument
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and the date of his holding the same may be proved by a certificate
executed by any responsible bank or trust company showing that on
the date therein mentioned such person had on deposit with such bank
or trusf company the bonds described in such -certificate.
Section 13. SEVERANCE
That if any one or more provisions, clauses, paragraphs or
sections of this ordinance or the application thereof to any set of
circumstances shall be held to be invalid for any reason, such hold-
ing shall not affect the validity or enforceability of the remaining
provisions, clauses, paragraphs and sections hereof, nor the appli-
cation thereof to other sets of circumstances .
Section 14. That all ordinances or parts thereof in conflict
herewith are to the extent of such conflict hereby repealed, and that
this ordinance shall be published in one issue of the Payette Lakes
Star, the official journal of said city, and shall take effect and be
in full force immediately upon its passage, approval and publication.
Adopted and approved August 7 67,
-yrs
Atte s : yor
City Cler
(Other business not pertinent to the above appears in the
minutes of the meeting. )
Pursuant to motion duly made and carried, the meeting
adjourned.
Attes : ayor
City ME,
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