HomeMy Public PortalAboutOrd 520 Kansas Public Water Supply Loan (Published in [Official City Newspaper] on [publication date])
ORDINANCE NO.520
AN ORDINANCE AUTHORIZING THE EXECUTION OF A LOAN
AGREEMENT BETWEEN THE CITY OF BEL AIRE, KANSAS AND THE
STATE OF KANSAS, ACTING BY AND THROUGH THE KANSAS
DEPARTMENT OF HEALTH AND ENVIRONMENT FOR THE PURPOSE OF
OBTAINING A LOAN FROM THE KANSAS PUBLIC WATER SUPPLY LOAN
FUND FOR THE PURPOSE OF FINANCING A PUBLIC WATER SUPPLY
PROJECT; ESTABLISHING A DEDICATED SOURCE OF REVENUE FOR
REPAYMENT OF SUCH LOAN; AUTHORIZING AND APPROVING CERTAIN
DOCUMENTS IN CONNECTION THEREWITH; AND AUTHORIZING
CERTAIN OTHER ACTIONS IN CONNECTION WITH THE LOAN
AGREEMENT.
WHEREAS, the Safe Drinking Water Act Amendments of 1996 [PL 104-182] to the Safe
Drinking Water Act (the "Federal Act") established the Drinking Water Loan Fund to assist public water
supply systems in financing the costs of infrastructure needed to achieve or maintain compliance with the
Federal Act and to protect the public health and authorized the Environmental Protection Agency (the
"EPA")to administer a revolving loan program operated by the individual states; and
WHEREAS, to fund the state revolving fund program, the EPA will make annual capitalization
grants to the states, on the condition that each state provide a state match for such state's revolving fund;
and
WHEREAS,by passage of the Kansas Public Water Supply Loan Act,K.S.A. 65-163d et seq., as
amended (the "Loan Act"), the State of Kansas (the "State") has established the Kansas Public Water
Supply Loan Fund(the "Revolving Fund")for purposes of the Federal Act; and
WHEREAS, under the Loan Act, the Secretary of the Kansas Department of Health and
Environment ("KDHE") is given the responsibility for administration and management of the Revolving
Fund; and
WHEREAS, the Kansas Development Finance Authority (the "Authority") and KDHE have
entered into a Pledge Agreement (the "Pledge Agreement") pursuant to which KDHE agrees to enter into
Loan Agreements with Municipalities for public water supply projects (the "Projects") and to pledge the
Loan Repayments (as defined in the Pledge Agreement) received pursuant to such Loan Agreements to
the Authority; and
WHEREAS, the Authority is authorized under K.S.A. 74-8905(a) and the Loan Act to issue
revenue bonds (the "Bonds") for the purpose of providing funds to implement the State's requirements
under the Federal Act and to loan the same, together with available funds from the EPA capitalization
grants,to Municipalities within the State for the payment of Project Costs (as said terms are defined in the
Loan Act); and
WHEREAS, BEL AIRE,Kansas (the "Municipality")is a municipality as said term is defined in
the Loan Act which operates a water system(the "System"); and
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WHEREAS, the System is a Public Water Supply System, as said term is defined in the Loan
Act; and
WHEREAS, the Municipality has, pursuant to the Loan Act, submitted an Application to KDHE
to obtain a loan from the Revolving Fund to finance the costs of improvements to its System consisting of
the following:
[See Exhibit A of Loan Agreement]
(the"Project"); and
WHEREAS,the Municipality has taken all steps necessary and has complied with the provisions
of the Loan Act and the provisions of K.A.R. 28-15-50 through 28-15-65 (the 'Regulations") applicable
thereto necessary to qualify for the loan; and
WHEREAS, KDHE has informed the Municipality that it has been approved for a loan in
amount of not to exceed$858,942(the "Loan")in order to finance the Project; and
WHEREAS, the governing body of the Municipality hereby finds and determines that it is
necessary and desirable to accept the Loan and to enter into a loan agreement and certain other documents
relating thereto, and to take certain actions required in order to implement the Loan Agreement.
THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF ,
KANSAS:
Section 1. Authorization of Loan Agreement. The Municipality is hereby authorized to accept
the Loan and to enter into a certain Loan Agreement, with an effective date of December 6, 2012 , with
the State of Kansas acting by and through the Kansas Department of Health and Environment (the "Loan
Agreement") to finance the Project Costs (as defined in the Loan Agreement). The Mayor and Clerk are
hereby authorized to execute the Loan Agreement in substantially the form presented to the governing
body this date, with such changes or modifications thereto as may be approved by the Mayor and the
Municipality=s legal counsel,the Mayor's execution of the Loan Agreement being conclusive evidence of
such approval.
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Section 2. Establishment of Dedicated Source of Revenue for Repayment of Loan. Pursuant
to the Loan Act, the Municipality hereby establishes a dedicated source of revenue for repayment of the
Loan. In accordance therewith, the Municipality shall impose and collect such rates, fees and charges for
the use and services furnished by or through the System,including all improvements and additions thereto
hereafter constructed or acquired by the Municipality as will provide System Revenues (as defined in the
Loan Agreement) sufficient to (a) pay the cost of the operation and maintenance of the System, (b) pay
the principal of and interest on the Loan as and when the same become due, (c)pay all other amounts due
at any time under the Loan Agreement, and (d) pay the principal of and interest on Additional Revenue
Obligations (as defined in the Loan Agreement) as and when the same become due; provided, however,
the pledge of the System Revenues contained herein and in the Loan Agreement (i) shall be subject to
reasonable expenses of operation and maintenance of the System, and(ii) shall be junior and subordinate
in all respects to the pledge of System Revenues to any Additional Revenue Obligations. In the event
that the System Revenues are insufficient to meet the obligations under the Loan and the Loan
Agreement, the Municipality shall levy ad valorem taxes without limitation as to rate or amount upon all
the taxable tangible property, real or personal, within the territorial limits of the Municipality to produce
the amounts necessary for the prompt payment of the obligations under the Loan and Loan Agreement. In
accordance with the Loan Act, the obligations under the Loan and the Loan Agreement shall not be
included within any limitation on the bonded indebtedness of the Municipality.
Section 3. Further Authority. The Mayor, Clerk and other City officials and legal counsel are
hereby further authorized and directed to execute any and all documents and take such actions as they
may deem necessary or advisable in order to carry out and perform the purposes of the Ordinance, and to
make alterations, changes or additions in the foregoing agreements, statements, instruments and other
documents herein approved, authorized and confirmed which they may approve, and the execution or
taking of such action shall be conclusive evidence of such necessity or advisability.
Section 4. Governing Law. The Ordinance and the Loan Agreement shall be governed
exclusively by and construed in accordance with the applicable laws of the State of Kansas.
Section 5. Effective Date. This Ordinance shall take effect and be in full force from and after
its passage by the governing body of the City and publication in the official City newspaper.
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PASSED by the governing body of the City on January 22, 2013 and signed by the
Mayor.
(SEAL)
Mayor
ATTEST:
Clerki
[APPROVED AS TO FORM ONLY.
je
` City At6mey �
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