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HomeMy Public PortalAbout2019_05_28_R085 Authorizing the Issuance of Its General Obligation BondsThe Town of Leesburg, Virginia PRESENTED: May 28, 2019 RESOLUTION NO. 2019-085 ADOPTED: May 28, 2019 A RESOLUTION: AUTHORIZING THE ISSUANCE OF ITS GENERAL OBLIGATION BONDS WHEREAS, the Town Council of the Town of Leesburg, Virginia (the "Town"), has determined that it is advisable to issue its general obligation bond or bonds in the maximum principal amount of $60,000,000 (the "New Money Bonds") to finance the costs of various capital improvement projects in the Town's Capital Improvements Program and other approved capital projects, including without limitation (1) the Leesburg Police Department Headquarters, (2) purchase of a hangar at the Leesburg Airport, and (3) utilities system projects (collectively, the "Projects") and the costs of issuing the New Money Bonds; WHEREAS, the Town Council has determined that it is advisable to refund all or a portion of the outstanding bonds or other obligations of the Town (the "Prior Bonds"), and to issue bonds of the Town in such aggregate principal amount as may be determined as set forth in paragraph 12 below (the "Refunding Bonds" and, together with the New Money Bonds, the "Bonds") to refund, redeem, and defease certain of the Prior Bonds and to finance the costs of issuing the Refunding Bonds; and WHEREAS, the Bonds are to be issued on the terms set forth in this Resolution, and a public hearing has been held on the date hereof on the issuance of the New Money Bonds after due publication of notice in accordance with Section 15.2-2606 of the Code of Virginia of 1950, as amended. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE TOWN OF LEESBURG: 116534556_3.docx -2- A RESOLUTION: AUTHORIZING THE ISSUANCE OF ITS GENERAL OBLIGATION BONDS 1. Authorization of Bonds and Use of Proceeds. The Town Council hereby determines that it is advisable and will benefit the inhabitants of the Town through the promotion of their safety, health, welfare and prosperity (i) to contract a debt and to issue and sell the New Money Bonds in the maximum principal amount of $60,000,000 and (ii) to contract a debt and to issue and sell the Refunding Bonds. Town Council hereby authorizes the issuance and sale of the Bonds on the terms and conditions set forth herein. The proceeds from the issuance and sale of the New Money Bonds shall be used to finance the costs of the Projects and the costs of issuing the New Money Bonds, and the proceeds from the issuance and sale of the Refunding Bonds shall be used to refund, redeem and defease all or a portion of the Prior Bonds and to finance the costs of issuing the Refunding Bonds. 2. Pledge of Full Faith and Credit. The full faith and credit of the Town are hereby irrevocably pledged for the payment of the principal of, premium, if any, and interest on the Bonds as the same become due and payable. The Town Council shall levy an annual ad valorem tax upon all property in the Town, subject to local taxation, sufficient to pay the principal of, premium, if any, and interest on the Bonds as the same shall become due for payment unless other funds are lawfully available and appropriated for the timely payment thereof. 3. Details and Sale of Bonds. The Town Manager is hereby authorized to determine and approve the final details of the Bonds, including without limitation, the principal amount of the Bonds, the number of series, the series designation of the Bonds, the maturity date of the Bonds, the redemption provisions of the Bonds, the sale price of the Bonds, the interest rates and interest rate provisions on the Bonds, the issuance date, and any elections under the federal tax code; provided that (i) the maximum principal amount of New Money Bonds shall not exceed $60,000,000, (ii) the maximum principal amount of Refunding Bonds shall not exceed the amount determined by the Town Manager as provided in paragraph 12 below, (iii) the final maturity of the New Money Bonds shall not be later than approximately 31 years from their issuance date; (iv) the true interest cost of the New Money Bonds shall not exceed 6.0% per annum (taking into account any original issue discount or premium); and (v) the Refunding Bonds shall result in a minimum debt service savings on a net present value basis of at least 3.0% of the refunded principal amount (the "Savings Parameter"). The Bonds shall be issued, in one or more series upon the terms established pursuant to this Resolution and upon such other terms as may be determined in the manner set forth in this Resolution. The Bonds shall be issued in fully registered form, shall be dated such date as the Town Manager or the Director of Finance and Administrative Services may approve, shall be in the denominations of $5,000 each or whole multiples thereof (if sold to the public), may be issued at one time or from time to time in one or more series (with appropriate series designations), and the Bonds of any series shall be numbered from R-1 upwards consecutively. The Bonds shall be offered for sale in such manner as the Town Manager or the Director of Finance and Administrative Services may determine to be in the best interests of the Town. If it is determined that it is in the best interest of the Town to sell all or a portion of the Bonds in a competitive sale, whether in a public sale or direct placement, then the Town Manager and the Director of Finance and Administrative Services, are hereby authorized and directed to accept the -3- A RESOLUTION: AUTHORIZING THE ISSUANCE OF ITS GENERAL OBLIGATION BONDS bid or proposal for the purchase of all or a portion of the Bonds, provided such bid results in the lowest true interest cost to the Town, and that the true interest cost of the New Money Bonds does not exceed the maximum true interest cost set forth above and the Refunding Bonds achieve the Savings Parameter. The Town Manager and the Director of Finance and Administrative Services are entitled to reject any or all bids. If it is determined that it is in the best interest of the Town to sell all or a portion of the Bonds in a negotiated sale, whether in a public sale or direct placement, then the Town Manager and the Director of Finance and Administrative Services are hereby authorized to enter into a bond purchase agreement with an underwriter or a group of underwriters with demonstrated experience in underwriting municipal securities to be selected by the Town Manager or the Director of Finance and Administrative Services, provided that the true interest cost of the New Money Bonds does not exceed the maximum true interest cost set forth above and the Refunding Bonds achieve the Savings Parameter If the Town Manager determines that it is in the best interest of the Town to issue any Bonds in a direct placement, then the Town Manager is hereby authorized to enter into any and all placement documents related to the direct placement and to select the holder after consultation with the Town's financial advisor. If any Bonds are issued by direct placement, such Bonds shall be registered in the name of the holders thereof, or, if the Town Manager approves of such designee, a designee selected by the holder, and such Bond may be delivered to the registered owner. 4. Form of Bonds. The Bonds shall be in substantially the form attached to this Resolution as Exhibit A, with such appropriate variations, omissions and insertions as are permitted or required by this Resolution. There may be endorsed on the Bonds such legend or text as may be necessary or appropriate to conform to any applicable rules and regulations of any governmental authority or any usage or requirement of law with respect thereto. 5. Book -Entry -Only Form. The Bonds sold in a public sale, whether negotiated or competitive, shall be issued in book -entry -only form in accordance with this paragraph 5. The Bonds shall be issued in fully -registered form and registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York ("DTC") as registered owner of the Bonds, and immobilized in the custody of DTC. One fully -registered Bond in typewritten or printed form for the principal amount of each maturity of the Bonds shall be registered to Cede & Co. Beneficial owners of the Bonds shall not receive physical delivery of the Bonds. Principal, premium, if any, and interest payments on the Bonds shall be made to DTC or its nominee as registered owner of the Bonds on the applicable payment date. Transfer of ownership interest in the Bonds shall be made by DTC and its participants (the "Participants"), acting as nominees of the beneficial owners of the Bonds in accordance with rules specified by DTC and its Participants. The Town shall comply with the agreements set forth in the Town's Letter of Representations to DTC. Replacement Bonds (the "Replacement Bonds") shall be issued directly to beneficial owners of the Bonds rather than to DTC or its nominee but only in the event that: (i) DTC determines not to continue to act as securities depository for the Bonds; -4- A RESOLUTION: AUTHORIZING THE ISSUANCE OF ITS GENERAL OBLIGATION BONDS (ii) The Town has determined to use a securities depository other than DTC; or (iii) The Town has determined that it is in the best interest of the beneficial owners of the Bonds or the Town not to continue the book -entry system of transfer. Upon occurrence of the event described in (i) or (ii) above, the Town shall attempt to locate another qualified securities depository. If the Town fails to locate another qualified securities depository to replace DTC, or if the Town makes the determination noted in (iii) above, and has made provisions to notify the beneficial owners of the Bonds by mailing an appropriate notice to DTC, the appropriate officers and agents of the Town shall execute and deliver Replacement Bonds substantially in the form set forth in Exhibit A attached hereto. Principal of and interest on the Replacement Bonds shall be payable as provided in this Resolution and in the Bonds and such Replacement Bonds will be transferable in accordance with the provisions of paragraphs 9 and 10 of this Resolution and the Bonds. 6. Appointment of Bond Registrar and Paying Agent. The Town Manager is hereby authorized to appoint a Bond Registrar and Paying Agent for the Bonds. If the Bonds are in book - entry -only form, the Bond Registrar and Paying Agent may be the Town Manager or other officer of the Town. The Town Manager is hereby authorized to appoint a subsequent registrar or one or more paying agents, or both, for the Bonds upon giving written notice to the owners of the Bonds specifying the name and location of the principal office of any such registrar or paying agent. 7. Execution of Bonds. The Town Manager and the Clerk of the Town Council are hereby authorized and directed to execute appropriate negotiable Bonds and to affix the seal of the Town thereto and to deliver the Bonds to the purchaser thereof upon payment of the purchase price. The manner of execution and affixation of the seal may be by facsimile, provided, however, that if the signatures of the Town Manager and the Clerk are both by facsimile, the Bonds shall not be valid until signed at the foot thereof by the manual signature of the Bond Registrar. 8. CUSIP Numbers. The Bonds sold in a public sale shall have CUSIP identification numbers printed thereon. No such number shall constitute a part of the contract evidenced by the Bond on which it is imprinted and no liability shall attach to the Town, or any of its officers or agents by reason of such numbers or any use made of such numbers, including any use by the Town and any officer or agent of the Town, by reason of any inaccuracy, error or omission with respect to such numbers. 9. Registration, Transfer and Exchange. Upon surrender for transfer or exchange of any Bond at the principal office of the Bond Registrar, the Town shall execute and deliver and the Bond Registrar shall authenticate in the name of the transferee or transferees a new Bond or Bonds of any authorized denomination in an aggregate principal amount equal to the Bond surrendered and of the same form and maturity and bearing interest at the same rate as the Bond surrendered, subject in each case to such reasonable regulations as the Town and the Bond Registrar may prescribe. All Bonds presented for transfer or exchange shall be accompanied by a written -5- A RESOLUTION: AUTHORIZING THE ISSUANCE OF ITS GENERAL OBLIGATION BONDS instrument or instruments of transfer or authorization for exchange, in form and substance reasonably satisfactory to the Town and the Bond Registrar, duly executed by the registered owner or by his or her duly authorized attorney -in -fact or legal representative. No Bond may be registered to bearer. New Bonds delivered upon any transfer or exchange shall be valid obligations of the Town, evidencing the same debt as the Bonds surrendered, shall be secured by this Resolution and entitled to all of the security and benefits hereof to the same extent as the Bonds surrendered. 10. Charges for Exchange or Transfer. No charge shall be made for any exchange or transfer of Bonds, but the Town may require payment by the registered owner of any Bond of a sum sufficient to cover any tax or other governmental charge which may be imposed with respect to the transfer or exchange of such Bond. 11. Non -Arbitrage Certificate and Tax Covenants. The Town Manager and the Director of Finance and Administrative Services are hereby authorized and directed to execute a Non -Arbitrage Certificate and Tax Covenants setting forth the expected use and investment of the proceeds of each series of Bonds and containing such covenants as may be necessary in order to comply with the provisions of the Internal Revenue Code of 1986, as amended (the "Code"), including without limitation the provisions of Section 148 of the Code and applicable regulations relating to "arbitrage bonds." The Town Council covenants on behalf of the Town that the proceeds from the issuance and sale of the Bonds shall be invested and expended as set forth in the Town's Non -Arbitrage Certificate and Tax Covenants, and one will be delivered simultaneously with the issuance and delivery of each series of Bonds, and that the Town shall comply with the other covenants and representations contained therein. 12. Refunding of the Prior Bonds. The refunding of the Prior Bonds shall be executed as follows: (i) the Town Manager and the Director of Finance and Administrative Services are hereby authorized and directed to select the particular Prior Bonds to be refunded provided that the issuance of Refunding Bonds to refund such Prior Bonds shall result in debt service savings at least equal to the Savings Parameter (such Prior Bonds, the "Refunded Bonds"); (ii) the Town Manager and the Director of Finance and Administrative Services are hereby authorized and directed to cause each of the Refunded Bonds to be redeemed on its earliest redemption date under applicable federal tax law and to cause redemption notices to be given to the holders of the Refunded Bonds pursuant to the terms of the Refunded Bonds; and (iii) the Town Manager and the Director of Finance and Administrative Services are hereby authorized and directed to cause to be prepared and to execute and deliver an escrow agreement or agreements between the Town and an escrow agent or escrow agents to be selected by the Town Manager and the Director of Finance and Administrative Services providing for the irrevocable deposit of the proceeds of the Refunding Bonds in amounts sufficient, when invested -6- A RESOLUTION: AUTHORIZING THE ISSUANCE OF ITS GENERAL OBLIGATION BONDS as set forth in the escrow agreement, to provide for the payment of the principal of and premium, if any, and interest on the Refunded Bonds. 13. Authorization of Interim Financing for the New Money Bonds. If market or other conditions are such that the Town Manager determines that it is not advisable to enter into a long- term financing for all or any portion of the projects to be fmanced with the proceeds of the New Money Bonds, the Town Manager, without further approval of the Town Council as to documentation or otherwise, is hereby authorized to execute, deliver and issue short-term notes of the Town (the "Notes") as provided in Section 15.2-2628 of the Virginia Code at public or private sale in anticipation of the issuance of any or all series of the New Money Bonds; provided that the aggregate principal amount of the Notes shall not exceed the principal amount authorized in paragraph 3 of this Resolution, the term to maturity thereof shall not exceed five years, and, if the Notes bear interest at a variable rate, the initial interest rate shall not exceed 4.0%. The Notes shall be subject to other terms and conditions contained in this Resolution to the extent not inconsistent with this paragraph 13. The Notes shall be secured in the same manner as the Bonds authorized hereunder. The Town may retire the Notes either by issuing the New Money Bonds authorized hereunder or by making a payment or payments from any other lawfully available funds, provided that the maximum amount of the New Money Bonds authorized hereunder will be reduced by the amount of Notes retired by other lawfully available funds. If the Town issues New Money Bonds to retire the Notes, the Town shall issue the Bonds in accordance with the terms of and subject to the parameters contained in this Resolution. 14. Disclosure Documents. The Town Manager and the Director of Finance and Administrative Services are hereby authorized and directed to prepare, execute, if required, and deliver an appropriate notice of sale, preliminary official statement, official statement, continuing disclosure agreement or such other offering or disclosure documents as may be necessary to expedite the sale of the Bonds. The notice of sale, preliminary official statement, official statement, continuing disclosure agreement or other documents shall be published in such publications and distributed in such manner, including by electronic distribution, and at such times as the Town Manager shall determine. The Town Manager is authorized and directed to deem the preliminary official statement "final" for purposes of Securities and Exchange Commission Rule 15c2-12. The Town Manager is hereby authorized and directed to enter into a Continuing Disclosure Agreement for the benefit of the owners of the Bonds to assist any underwriter(s) for the Bonds in complying with the provisions of Section (b)(5) of Securities and Exchange Commission Rule 15c2-12. 15. Further Actions. The Mayor, the Town Manager, the Town Attorney and the Director of Finance and Administrative Services are hereby authorized and directed to take such further action as they deem necessary regarding the issuance and sale of the Bonds and the refunding of certain of the Prior Bonds, and all actions taken by such officers and agents in connection with the issuance and sale of the Bonds and the refunding of certain of the Prior Bonds are hereby ratified and confirmed. 16. Authorized Officers. The authorizations granted in this Resolution to the Town Manager, Director of Finance and Administrative Services, Clerk or Town Attorney, as applicable, LF\LeesburgRMS\Town_Clerk\Resolutions\2019\0528 - Authorizing the Issuance of Its General Obligation Bonds