HomeMy Public PortalAboutResolution 2011-22, BONDING PROCEDURES - A Resolution Authorizing And Direting Deposit Of Bond Funds, May 3, 2011RESOLUTION NO. 2011-22
A RESOLUTION AUTHORIZING AND DIRECTING
DEPOSIT OF BOND FUNDS
WHEREAS, The City of Riverdale, Iowa ("Riverdale"), by prior Resolution, has
authorized the issuance of Two Million Dollars ($2,000,000.00) General Obligation Capital Loan
Notes, Series 2011, dated May 4, 2011 ("2011 Bonds"); and
WHEREAS, it is necessary to designate a qualified financial institution for deposit of
proceeds of the 2011 Bonds; and
WHEREAS, Quad City Bank and Trust Company is an authorized depository of City
funds, and the City maintains existing accounts with such financial institution.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Riverdale, State of
Iowa, that:
1. Quad City Bank and Trust Company, Davenport, Iowa is hereby designated as the initial
depository of proceeds of the 2011 Bonds; and
2. The Mayor and City Clerk are authorized to sign such agreements or directions as may be
required for deposit of the proceeds of the 2011 Bonds with Quad City Bank and Trust Company into
existing City accounts with such institution; and
3. The Mayor and City Clerk are authorized to arrange for such further deposit, investment,
and re -investment of the proceeds of the 2011 Bonds in accordance with existing Resolutions concerning
custody and management of City funds and the Loan Agreement with respect to the 2011 Bonds.
PASSED, APPROVED AND ADOPTED THIS 3 day of May 2011.
Ayes: Halsey, Channon, Hupp Nays:
Littrel, and Franklin
ffre-rindle, Mayor
ATTEST:
ac.J & 1Y Ch Th4h
Paula McIntosh, City Clerk
BONDING PROCEDURES
MUNICIPAL CLERKS INSTITUTE
Ahlers & Cooney, P.C.
Mark Cory
Kristin Cooper
MUNICIPAL FINANCING TERMS
Accrued interest. Interest on a bond or note since the last interest payment or, for a new
issue, from the dated date. An accrued interest payment is made to the issuer at closing if
the dated date is earlier than the closing date.
Ad Valorem Tax. ("according to its value") A state or local governmenttax based on the
value of real property as determined by the county tax assessor.
Advance Refunding Bonds. A second bond issue sold at a lower interest rate than an
earlier issue that is not currently callable. The proceeds of the second issue are placed in
an escrow account from which the first issue's principal and interest will be repaid when
callable.
Amortization of Debt. The annual reduction of principal through the use of serial bonds
or term bonds with a sinking fund.
Annual Appropriation Pledge. A pledge typically found in the bond resolution that
commits the issuer to make periodic debt service payments to the extent that moneys are
budgeted and appropriated on an annual basis by the issuer's governing body. The
governing body is not legally obligated to make such appropriation in any year. This
clause permits a borrowing entity to undertake a financing without technically incurring
debt beyond amounts that are annually appropriated.
Arbitrage. The interest rate differential that exists when proceeds from a municipal bond
- which is tax-free and carries a lower yield - are invested in taxable securities with a
yield that is higher. The 1986 Tax Reform Act made this practice by municipalities
illegal solely as a borrowing tactic, except undei- certain safe -harbor conditions.
Assessed Valuation. A municipality's worth in dollars based on real estate and/or other
property for the purpose of taxation, sometimes expressed as a percent of the full market
value of the community.
Authority or Agency. A state or local unit of government created to perform a single
activity or a limited group of functions and authorized by the state legislature to issue
bonded debt.
Authorizing Resolution. An official action taken that allows the unit of government to
sell a specific bond issue or finance a specific project.
Average life. The average length of time an issue of serial bonds and/or term bonds with
mandatory sinking funds and/or estimated prepayments is expected to be outstanding. It
also can be the average maturity of a bond portfolio.
Balloon Maturity. An inordinately large amount of bond principal maturing in any
single year. Also called a Term Bond.
B.A.N. (Bond Anticipation Note). A short-term security used for interim financing to be
repaid from the proceeds of a planned long-term bond issue.
Bank Qualified. Designation given to a public purpose bond offering by the issuer if it
reasonably expects to issue in the calendar year of such offering no more than $10
million par amount of bonds of the type required to be included in making such
calculation under the Internal Revenue Code. When purchased by a commercial bank for
its portfolio, the bank may receive an 80% tax deduction for the interest cost of carry for
the issue. A bond that is bank qualified is also known as a "qualified tax-exempt
obligation."
Base Point (or Basis Point). One one -hundredth of one percent (1/100 % or 0.01
percent). Thus 25 basis points equal one -quarter of one percent, 100 basis points equal
one percent.
Bid. An offer to buy at a fixed price or yield.
Bond or note. A security whereby an issuer borrows money from an investor and agrees
and promises, by written contract, to pay a fixed principal sum on a specified date
(maturity date) and at a specified rate of interest.
A Bond. A unit of debt, $1000 of principal or par amount. For 200 years municipal bonds
were sold in $1000 denominations. Since the mid-1970s the minimum bond
denomination has been $5000; nevertheless, "A Bond" is bought, sold, referred to and
priced as if it were $1000.
Bond Counsel. A lawyer who writes an opinion on the bond or note as to its tax exempt
status and the authenticity of its issuance. In theory their opinion is meant to assure the
bond investor, but they are paid by the issuer so it is not clear who their real client is.
Bond Insurance. Insurance issued by a private insurance company for either an entire
issue or specific maturities that guarantees to pay principal and interest when due. This
will provide a credit rating of triple-A and thus a lower borrowing cost for the issuer.
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Bond Premium. The amount at which a bond or note is bought or sold above its par
value or face value without including accrued interest.
Bond Purchase Agreement (BPA). The contract between the underwriter and the issuer
setting forth the final ternis, prices and conditions upon which the underwriter purchases
a new issue of municipal securities in a negotiated sale.
Bonded indebtedness. The portion of an issuer's debt structure represented by
outstanding bonds in Iowa limited by constitutional restraints to 5% of the value of the
taxable property of the issuer based upon the last tax list.
Bond Resolution. A resolution detailing the terms and conditions of a bond offering.
Also referred to as an authorizing resolution.
Book Entry. A system of security ownership in which the ownership is held as a
computer entry on the records of a central company for its owner. The bond owner gets a
computer printout as proof of ownership.
Broker. Technically a broker is a bond trader in the secondary market buying from and
selling to bond dealers. Its most common usage is as a description of a bond salesperson.
Build America Bonds. A taxable bond or note issued in calendar years 2009 or 2010,
for which the Federal government pays 35% of the interest costs.
Callable bond. A bond or note that is subject to redemption at the option of the issuer
prior to its stated maturity. The call date and call premium, if any, is stated in the offering
statement or broker's confirmation.
Capital Expenditure. Any cost of a type that is properly chargeable to capital account
(or would be so chargeable with a proper election or with the application of the definition
of placed in service under §1.150-2(c)) under general Federal income tax principles. For
example, costs incurred to acquire, construct, or improve land, buildings, and equipment
generally are capital expenditures. Whether an expenditure is a Capital Expenditure is
determined at the time the expenditure is paid with respect to the property. Future
changes in law do not affect whether an expenditure is a Capital Expenditure.
Capital Loan Note. A security issued to borrow money as an alternative to a Bond.
Unless a note will be repaid within the fiscal year, notice and hearing (or election) are
required. Unlike many bonds, capital loan notes do not have to be sold at a public sale.
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Certificates of Participation (COPs). A form of lease revenue bond that permits the
investor to participate in a stream of lease payments, installment payments or loan
payments relating to the acquisition or construction of specific equipment, land or
facilities.
Closing. The exchange of securities for payment in a new issue. On the closing date, the
issuer delivers the securities and the requisite legal documents in exchange for the
purchase price.
Competitive Sale. A method of sale where underwriters submit proposals for the
purchase of a new issue of municipal securities and the securities are awarded to the
underwriter or underwriting syndicate presenting the best bid according to stipulated
criteria set forth in the notice of sale. The underwriting of securities in this manner is
also referred to as a "public sale."
Conduit Bonds. Bonds whose repayment is the responsibility of the business or
developer who benefits from the financing, rather than the issuer who only collects the
taxes, fees or revenues and passes them on to the bondholder.
Continuing Disclosure Certificate. A document wherein the issuer agrees to file annual
reports and give notice of certain occurrences to satisfy federal securities laws.
Cost of Issuance. The costs to the extent incurred in connection with, and allocable to,
the issuance of an issue within the meaning of Section 147(g). For example, issuance
costs include, but are not limited to, the following costs to the extent incurred in
connection with, and allocable to, the borrowing: underwriters' spread; counsel fees;
financial advisory fees; rating agency fees; trustee fees; paying agent fees; Note registrar,
certification and authentication fees; accounting fees; printing costs for Notes and
offering documents; public approval process costs; engineering and feasibility study
costs; guarantee fees, other than for qualified guarantees (as defined in §1.148-4(0); and
similar costs.
Coupon rate. The specified annual interest rate payable to the bond or note holder as
printed on the bond. This term is still used even though there are no coupon bonds
anymore.
Covenant. A legally binding commitment by the issuer of municipal bonds to the
bondholder. An impairment of a covenant can lead to a Technical Default.
Coverage. This is the margin of safety for payment of debt service on a revenue bond
that reflects the number of times the actual and/or estimated project earnings or income
for a 12-month period of time exceeds debt service that is payable.
Current Yield. The ratio of the coupon rate on a bond to the dollar purchase price
expressed as a percentage. Thus if you pay par or 100 cents on the dollar for your bond
and the coupon rate is 6%, the current yield is 6`)/0; however, if you paid 97 for your 6%
discount bond, the current yield is 6.186%. (.06 divided by 97). If you paid 102 for a 6%
bond, the current yield is 5.88% (.06 divided by 102).
Dated Date. (dtd.) The date carried on the face of a bond or note from which interest
normally begins to accrue.
Dealer. A corporation or partnership that buys and sells and maintains an ongoing
position in bonds and/or notes. They are also authorized to underwrite new issues. Some
large commercial banks are licensed to act as bond dealers.
Debt Limit. The maximum amount of bonded indebtedness a bond issuer can have
outstanding at any time. In Iowa, 5% of the value of taxable property of the issuer on the
last tax list under [owa Code Section 443.2.
Debt Ratio. The ratio of the issuer's general obligation debt to a measure of value, such
as real property valuations, personal income, general fund resources, or population.
Debt Service. Required payments for principal and interest.
Debt Service Reserve Fund. A bank trustee account established by the trust indenture
and used as a backup security for an issuer's bonds. IRS Regulations limit the amount in
this fund.
Default. Failure to pay in a timely manner principal and/or interest when due, or a
Technical Default, the occurrence of an event as stipulated in the Indenture of Trust
resulting in an abrogation of that agreement. A Technical Default can be a warning sign
that a default on debt service is corning, but in reality actual debt service interruption
does not always occur if the problems are resolved in time. A Technical Default will
almost always drive down the price of a bond in secondary market trading.
Defeased bonds. Refunded bonds for which the payment of principal and interest has
been assured through the structuring of a portfolio of government securities, the principal
and interest on which will be sufficient to pay debt service on the refunded, outstanding
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bonds. When a bond issue is defeased, the claim on the revenues of the issuer is usually
eliminated.
Delinquent Taxes. Property taxes that have been levied but remain unpaid on and after
the due date. In Iowa, October 1 and April 1. Special assessments are also delinquent on
October 1 as well. When tax delinquencies exceed 5% the Bond Advisor places the issue
on its internal Bond Watch.
Delivery. For bonds bought or sold in the secondary market, delivery - and payment -
must be in three business days. For new issues, the time when payment is made to, and
the executed bonds and notes are received from, the issuer. New -issue delivery takes
place several weeks after the sale to allow the bonds and notes to be printed and signed.
Denomination. The face or par amount - nominally $1,000 or $5,000 but can be
$100,000 or more in the case of a note - that the issuer promises to pay at a specific bond
or note maturity.
Direct debt. In general obligation bond analysis, the amount of debt that a particular
local unit ofgovernment has incurred in its own name or assumed through annexation.
Discount. The amount of dollars by which market value of a bond is less than par value
or face value.
Discount Bonds. Bonds which sell at a dollar price below par in which case the yield
would exceed the coupon rate. The difference between the discount price and the
maturity price is subject to federal capital gains tax except in the case of Original Issue
Discount Bonds. See Original Issue Discount Bonds.
Double-barreled Bond. A bond with two distinct pledged sources of revenue, such as
earmarked monies from a specific enterprise or aid payment, as well as the general
obligation taxing powers of the issuer. An Iowa Local Option Sales and Service Bond
with limited G.O. authority is one example.
EMMA. The Electronic Municipal Market Access system (EMMA) is a comprehensive,
centralized online source for free access to municipal disclosures and market
transparency data. Municipal bond issuers and designated dissemination agents must file
their continuing disclosure documents with the Municipal Securities Rulemaking Board
(MSRB) and this filing must be made by electronically posting the information in PDF
format on the EMMA website.
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Escrow Fund. A fund that contains monies that only can be used to pay debt service.
Escrowed to Maturity. An Advance Refund bond. When interest rates fall, an issuer
may choose to sell a new issue called an advance refunding bond and use the proceeds of
the second issue to pay off the original issue, much the same as a home owner
refinancing a mortgage in an effort to save interest costs. The proceeds of the refunding
issue are used to structure a portfolio of U.S. government securities, the principal and
interest payments of which exactly match the principal and interest payments of the
refunded bonds. The portfolio is placed in escrow at the paying agent and the bond issue
is said to be fully defeased and escrowed to maturity. The first issue is called when
callable.
Feasibility Study. A financial study provided by the issuer of a revenue bond that
estimates service needs, construction schedules, and most importantly, future project
revenues and expenses used to determine the financial feasibility and creditworthiness of
the project to be financed.
Fiscal Year. A 12-month time horizon by which state and local governments annually
budget their respective revenues and expenditures. For Iowa cities, July 1 to June 30.
Fixed Rate. An interest rate on a security that does not change for the remaining life of
the security.
Flow of Funds. The annual legal sequence by which enterprise revenues are paid out for
operating and maintenance costs, debt service, sinking fund payments, and so on.
Form 8038. A tax return filed in connection with the issuance of a bond, note or other
tax-exempt obligation.
Form 8038-CP. A form tiled to request payment of
subsidy.
% Build America Bond
Full Faith and Credit. The pledge of "the full faith and credit and taxing power without
limitation as to rate or amount." A phrase used primarily in conjunction with General
Obligation bonds to convey the pledge of utilizing all taxing powers and resources, if
necessary, to pay the bond holders.
General Obligation Bond. (G.O.) Secured by a pledge of the issuer's ad valorem
property taxes and other general revenues. Considered the most secure of all municipal
debt.
General Property Tax. A tax levied on real estate and personal property.
Gross Revenues. Generally, all annual receipts of a revenue bond issuer prior to the
payment of all expenses. Normally only Net Revenues are pledged to the repayment of
bonds.
Industrial Development Bonds. (IDBs) also called Industrial Revenue Bonds (IRBs). In
Iowa these are issued under Chapter 419. Used to finance facilities for private
enterprises, water and air pollution control, ports, airports, resource -recovery plants, and
housing, among others. The bonds are backed by the credit of the private corporation
borrower rather than by the credit of the issuer. Also known as Conduit Bonds. Private
purpose bonds are limited by federal law to a "volume cap" assigned to the state based
upon the state's population on an annual basis.
Interim Borrowing. (1) Short-term loans to be repaid from general revenues or tax
collections during the current fiscal year (Stamped Warrants); (2) short-term loans in
anticipation of bond issuance, special assessment or grant receipts.
Issuer. A state or local unit of government that borrows money through the sale of bonds
and/or notes.
Investment Grade. Bond issues that the three major bond rating agencies, Moody's,
Standard & Poor's, and Fitch rate BBB or Baa or better. Many fiduciaries, trustees, some
mutual fund managers can only invest in securities with an investment grade rating.
Legal Opinion. A written opinion from bond counsel that an issue of bonds was duly
authorized and issued and usually that interest is exempt from federal taxes.
Letter of Credit. A form of supplement or, in some cases, direct security for a municipal
bond under which a commercial bank or private corporation guarantees payment on the
bond under certain specified conditions.
Level Debt Service. Principal and interest payments that, together, represent more or less
equal annual payments over the life of the loan. Principal may be serial maturities or
sinking fund installments.
Lien. A claim on revenues, assessments or taxes made for a specific issue of bonds.
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Limited Tax Bond. A bond secured by a pledge ot'a tax that is limited as to rate or
amount.
Municipal Advisor. Investment-banking company or independent consulting firm that
advises the issuer on all financial matters pertaining to a proposed issue.
Municipal Bond. Bonds issued by any of the 50 states, the territories and their
subdivisions, counties, cities, towns, villages and school districts, agencies, such as
authorities and special districts created by the states, and certain federally sponsored
agencies such as local housing authorities. Historically, the interest paid on theses bonds
has been exempt from federal income taxes.
Municipal Securities Rulemaking Board (MSRB). An independent self -regulatory
organization established by Congress in 1975 which is charged with primary rulemaking
authority - under the SEC - over dealers, dealer banks, and brokers in municipal
securities.
Negotiated Sale. The sale of a new issue of municipal securities by an issuer directly to
an underwriter or underwriting syndicate selected by the issuer. A negotiated sale is
distinguished from a sale by competitive bid, which requires public bidding by the
underwriters.
Net Bonded Debt. Gross general obligation debt less self-supporting general obligation
debt, housing bonds, water rev enue bonds, etc.
Net Interest Cost (NIC). Generally speaking, issuers award competitive bond sales to
the underwriter bidding the lowest NIC. It represents the average coupon rate weighted to
reflect the time until repayment of principal and adjusted for the premium or discount.
Net Revenue Available for Debt Service. Usually, gross operating revenues of an
enterprise less operating and maintenance expenses but exclusive of depreciation and
bond principal and interest. Net revenue as thus defined is used to determine coverage on
revenue bond issues.
Official Statement (OS). A document (prospectus) circulated for an issuer prior to a
bond sale with salient facts regarding the proposed financing. There are two OSs, the first
known as the preliminary, is supposed to be available to the investor before the sale. The
final OS must be sent to the purchaser before delivery of the bonds.
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Original Issue Discount. Some maturities of a new bond issue that have an offering
price substantially below par; the appreciation from the original price to par over the life
of the bonds is treated as tax-exempt income and is not subject to capital gains tax.
Overlapping Debt. The proportionate share of the general obligation bonds of local
governments located wholly or in part within the limits of the reporting unit of
government that must be borne by property owners within the unit.
Par Value. The face value or principal amount of a bond, usually $5,000 due the holder
at maturity. It has no relation to the market value. For pricing purposes it is considered
$1,000.
Parity Bonds. Revenue bonds that have an equal lien on the revenues of the issuer.
Parity Certificate. A signed, written statement showing that the net revenues of a utility
or enterprise will be sufficient to pay off existing obligations and new proposed
obligations. Usually signed by a CPA,an engineer, or an independent Financial
Consultant.
Paying Agent. Also Fiscal Agent. Generally a bank that performs the function of paying
interest and principal for the issuing body.
Premium. The amount, if any, by which the price exceeds the principal amount (par
value) of a bond. Its current yield will be less than its coupon rate.
Price to Call. The yield of a bond priced to the first call date rather than maturity. Used
to compute yield when there are premium bonds.
Primary Market. The new issue market
Principal. The face value of a bond, exclusive of interest.
Project Notes. Short-term municipal obligations, generally maturing in two years or less.
The most common types are (1) bond anticipation notes (BANs), (2) revenue anticipation
notes (RANs), (3) tax anticipation notes (TANs), (4) grant anticipation notes.
RANs. Revenue anticipation notes.
Rate Covenant. A legal commitment by a revenue bond issuer to maintain rates at levels
to generate a specified debt -service coverage.
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Ratings. Various alphabetical and numerical designations used by institutional investors,
Wall Street underwriters, and commercial rating companies to give relative indications of
bond and note creditworthiness. Standard & Poor's and Fitch Investors Service Inc. use
the same system, starting with their highest rating of AAA, AA, A, BBB, BB, B, CCC,
CC, C, and D for default. Moody's Investors Services uses Aaa, Aa, A, Baa, Ba, B, Caa,
Ca, C, and D. Each of the services use + or - or +1 to indicate half steps in between. The
top four grades are considered Investment Grade Ratings
Redemption. Process of retiring existing bonds prior to maturity from excess earnings or
proceeds of refunding bonds. Also known as a call.
Refunding Bond. The issuance of a new bond for the purpose of retiring an already
outstanding bond issue can be a current or an advance refunding.
Revenue Bond. A municipal bond whose debt service is payable solely from the
revenues derived from operating the facilities acquired or constructed with the proceeds
of the bonds.
Security. The legally available revenues and assets that are used to pay the bond holders.
The key component that supports debt service.
Serial Bond. A bond of an issue that features inaturities every year, annually or
semiannually over a period of years, as opposed to a Term Bond, which is a large block
of bonds maturing in a single year.
Short term. Bonds or notes sold on an interim basis with tax-exempt securities for a
period of from one to five years.
Sinking Fund. Money set aside on a periodic basis to retire term bonds at or prior to
maturity.
Sinking Fund Schedule. A schedule of payments required under the original revenue
bond resolutions to be placed each year into a special fund, called the sinking fund, and to
be used for retiring a specified portion of a term bond issue prior to maturity.
Special Assessment Bond. Secured by levy of special assessments, as opposed to
property taxes, upon properties that receive specific benefit from the improvement.
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"
S t a m p e d W a r r a n t . A m e t h o d o f b o r r o w i n g m o n e y t o b e r e p a i d w i t h i n t h e s a m e f i s c a l
y e a r . A r r a n g e m e n t s a r e m a d e w i t h t h e b a n k w h e r e t h e c h e c k ( w a r r a n t ) w i l l b e w r i t t e n f o r
t h e i n t e r e s t r a t e t o b e c h a r g e d u n t i l t h e w a r r a n t i s c o v e r e d .
T A N . T a x A n t i c i p a t i o n N o t e .
T a x B a s e . T h e t o t a l r e s o u r c e o f t h e c o m m u n i t y t h a t i s l e g a l l y a v a i l a b l e f o r t a x a t i o n .
T a x a b l e E q u i v a l e n t Y i e l d . T h e y i e l d a n i n v e s t o r w o u l d h a v e t o o b t a i n o n a t a x a b l e
c o r p o r a t e o r U . S . g o v e r n m e n t b o n d t o m a t c h t h e s a m e a f t e r - t a x y i e l d o n a m u n i c i p a l
b o n d .
T a x - e x e m p t B o n d . B o n d s e x e m p t f r o m f e d e r a l i n c o m e , s t a t e i n c o m e , o r s t a t e t a x a n d
l o c a l p e r s o n a l p r o p e r t y t a x e s . T h i s t a x e x e m p t i o n r e s u l t s f r o m t h e t h e o r y o f r e c i p r o c a l
i m m u n i t y : S t a t e s d o n o t t a x i n s t r u m e n t s o f t h e f e d e r a l g o v e r n m e n t a n d t h e f e d e r a l
g o v e r n m e n t d o e s n o t t a x i n t e r e s t o f s e c u r i t i e s o f s t a t e a n d l o c a l g o v e r n m e n t s .
T a x I n c r e m e n t F i n a n c i n g ( T I F ) . A m e c h a n i s m u s e d t o p a y t h e c o s t o f a n u r b a n
r e n e w a l p r o j e c t w i t h n e w t a x e s t h a t a r e g e n e r a t e d b y t h e p r o j e c t .
T e c h n i c a l D e f a u l t . F a i l u r e b y t h e i s s u e r t o m e e t t h e r e q u i r e m e n t s o f a b o n d c o v e n a n t .
T h e s e d e f a u l t s d o n o t n e c e s s a r i l y r e s u l t i n l o s s e s t o t h e b o n d h o l d e r . T h e d e f a u l t m a y b e
c u r e d b y s i m p l e c h a n g e s o f p o l i c y o r a c t i o n s b y t h e i s s u e r .
T e r m B o n d . A l a r g e b l o c k o f b o n d s o f l o n g m a t u r i t y . T h e y m a y b e p a r t o f a s e r i a l B o n d
i s s u e ; t h e r e m a y b e m o r e t h a n o n e t e r m b o n d i n a n i s s u e o r a s i n g l e m a t u r i t y . S o m e a r e
s u b j e c t t o a s i n k i n g f u n d r e d e m p t i o n . N o w l e g a l f o r g e n e r a l o b l i g a t i o n b o n d s s o l d b y
I o w a m u n i c i p a l i t i e s .
T R A N . T a x a n d R e v e n u e A n t i c i p a t i o n N o t e .
T r u s t e e . A b a n k d e s i g n a t e d a s t h e c u s t o d i a n o f f u n d s a n d o f f i c i a l r e p r e s e n t a t i v e o f
b o n d h o l d e r s . T r u s t e e s a r e a p p o i n t e d t o i n s u r e c o m p l i a n c e w i t h t h e a u t h o r i z i n g r e s o l u t i o n
a n d r e p r e s e n t s b o n d h o l d e r s t o e n f o r c e t h e i r c o n t r a c t w i t h t h e i s s u e r .
U n d e r l y i n g D e b t . T h e g e n e r a l o b l i g a t i o n b o n d s o f s m a l l e r u n i t s o f l o c a l g o v e r n m e n t
w i t h i n a g i v e n i s s u e r '