HomeMy WebLinkAboutRES NO 134-17N ,c mK
RESOLUTION NO. 13 4- 17 X -Ref. 1- I1-140l
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A RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF NOT TO
EXCEED $25 MILLION IN AGGREGATE PRINCIPAL AMOUNT OF CITY
OF BAKERSFIELD, CALIFORNIA, DOMESTIC WATER REVENUE BONDS
SERIES 2017A, APPROVING A MASTER TRUST INDENTURE, A FIRST
SUPPLEMENTAL TRUST INDENTURE, PRELIMINARY AND FINAL
OFFICIAL STATEMENTS, A BOND PURCHASE CONTRACT-AND A
CONTINUING DISCLOSURE CERTIFICATE, AND AUTHORIZING AND
DIRECTING ADDITIONAL ACTIONS IN CONNECTION WITH RESPECT
THERETO.
(Domestic Water Revenue Bonds, Series 2017A)
WHEREAS, the City of Bakersfield (the "City") is a charter city organized and existing
under the laws of the State of California (the "State "); and
WHEREAS, the City presently owns a domestic water system whose facilities famish
water service to residential and commercial customers within the City's geographic boundaries
and such additional areas as may be added to or serviced by the domestic water system (the
`Enterprise "); and
WHEREAS, the City Council (the "Council ") of the City, acting under and pursuant to
the powers reserved to the City under Section 3, 5 and 7 of Article XI of the Constitution of the
State and Section 33.3 of the Charter of the City (the "Charter "), has enacted the City of
Bakersfield Enterprise Revenue Bond Law (the "Bond Law"), being Chapter 3.55 of the
Municipal Code of the City, which incorporates, to the extent made applicable by the Law, the
Revenue Bond Law of 1941, being Chapter 6 of Division 2 of Title 5 of the California
Government Code, as enacted and as thereafter amended; and
WHEREAS, pursuant to the Charter and the Bond Law, the City has the power to
authorize and issue revenue bonds to finance the acquisition, construction and improvement of,
including the reconstruction, replacement, extension, repair, betterment and equipment for, any
revenue producing improvement, building, system, plant, works, facility or undertaking used for
any public purpose; and
WHEREAS, the Charter and the Bond Law authorize the City to issue enterprise revenue
bonds for the purposes set forth therein; and
WHEREAS, pursuant to the Charter, the City has previously established a special fund
for its domestic water system Enterprise (the "Domestic Water Fund ") and funds derived from
the Enterprise are deposited in the Domestic Water Fund, which is segregated from all other
revenues and general funds of the City and such Domestic Water Fund is not maintained from
amounts deposited in the City's general fund; and
WHEREAS, the City operates groundwater wells, and in order to provide treatment for
contamination of the synthetic organic chemical 1,2,3- trichloropropane ( "TCP ") found in the
groundwater and to comply with certain rules promulgated by the State Water Resources Control
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Board (the "SWRCB ") regarding the maximum contaminant level ( "MCL ") for TCP and to
protect the health of the public, the City intends to finance the installation of wellhead treatment
systems at each groundwater well in accordance with such SWRCB rules (the "Series 2017A
Project') and finance costs related to the Series 2017A Project; and
WHEREAS, the City has determined that it is necessary and advisable to issue, from time
to time, one or more series of Bonds (as defined in the hereinafter defined Master Trust
Indenture) for the purposes set forth in the Bond Law, the Master Trust Indenture (as hereinafter
defined) and the First Supplemental Trust Indenture (as hereinafter defined), and that such Bonds
be payable from and secured by Net Revenues (as defined in the Master Trust Indenture); and
WHEREAS, the City has determined that it is in its best interests to issue one or more
series of Bonds in an aggregate principal amount not to exceed $25 million in order to finance a
portion of the cost and expense of the acquisition, construction, improvement and equipping the
Series 2017A Project; and
WHEREAS, the City has determined that such Bonds shall be designated as the City of
Bakersfield, California, Domestic Water Revenue Bonds, Series 2017A (the "Series 2017A
Bonds "); and
WHEREAS, the Series 2017A Bonds will be issued pursuant to the Charter, the Bond
Law, certain other provisions of the laws of the State, the Master Trust Indenture and the First
Supplemental Indenture; and
WHEREAS, the Series 2017A Bonds will be issued so that the interest paid on the
Series 2017A Bonds will be excludable from the gross income of the recipients thereof under the
provisions of the Internal Revenue Code of 1986, as amended, and the regulations promulgated
thereunder or related thereto (collectively, the "Code "); and
WHEREAS, City staff has selected Citigroup Global Markets Inc. (the "Underwriter ") as
the underwriter of the Series 2017A Bonds; and
WHEREAS, City staff has recommended the selection of U.S. Bank National Association
to act as trustee (the "Trustee ") under the Master Trust Indenture and the First Supplemental
Indenture; and
WHEREAS, there have been prepared and submitted to the City Clerk for consideration
of this Council forms of the following documents:
(a) a form of the Master Trust Indenture (the "Master Trust Indenture "), to be
entered into by and between the City and the Trustee;
(b) a form of the First Supplemental Trust Indenture (the "First Supplemental
Indenture"), to be entered into by and between the City and the Trustee;
(c) a form of the Preliminary Official Statement (the "Preliminary Official
Statement');
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(d) a form of the Bond Purchase Contract (the "Bond Purchase Contract') by
and between the Underwriter and the City with respect to the purchase and sale of the
Series 2017A Bonds; and
(e) a form of the Continuing Disclosure Certificate (the "Continuing
Disclosure Certificate ") to be entered into by the City;
WHEREAS, said documents will be modified and amended to reflect the various details
applicable to the Series 2017A Bonds and said documents are subject to completion to reflect the
results of the sale of the Series 2017A Bonds; and
WHEREAS, the City desires to appoint Fieldman, Rolapp & Associates Inc., to act as
financial advisor (the "Financial Advisor "); and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Bakersfield
as follows:
Section 1. Issuance of Series 2017A Bonds; Terms of Series 2017A Bonds. For the
purposes set forth in the foregoing recitals, the City hereby authorizes the issuance of its Series
2017A Bonds in an aggregate principal amount not to exceed $25,000,000, plus the amount of
any original issue premium (subject to the limitations set forth in this Resolution) at which the
Series 2017A Bonds may be sold. The proceeds from the sale of the Series 2017A Bonds shall
be used to (i) finance the Series 2017A Project and /or certain other capital projects for the
Enterprise, (ii) reimburse the Enterprise /City for expenditures previously incurred by the
Enterprise /City for the Series 2017A Project and/or certain other capital projects for the
Enterprise, (iii) pay the costs of issuance of the Series 2017A Bonds, (iv) pay capitalized interest
on the Series 2017A Bonds, if determined by the Finance Director of the City to be necessary or
desirable, (v) fund a reserve fund for the Series 2017A Bonds and /or purchase a reserve fund
surety bond, if determined by the Finance Director of the City to be necessary or desirable, and
(vi) pay for a municipal bond insurance policy, if it is determined by the Finance Director of the
City that bond insurance results in savings to the City.
The Series 2017A Bonds shall be in fully registered form and may be issued as Book -
Entry Bonds as provided for in the Master Trust Indenture and the First Supplemental Indenture.
Payment of principal of and interest on the Series 2017A Bonds shall be made at the place or
places and in the manner provided in the Master Trust Indenture and the First Supplemental
Indenture.
The Series 2017A Bonds shall be issued as current interest bonds and shall be initially
available in denominations of $5,000 and integral multiples thereof. The Series 2017A Bonds
shall, when issued, be in the aggregate principal amounts and shall be dated as shall be provided
in the final forms of the Master Trust Indenture and the First Supplemental Indenture. The
Series 2017A Bonds may be issued as serial bonds or as term bonds or as both serial bonds and
term bonds, all as set forth in the First Supplemental Indenture. Except as otherwise permitted
under this Resolution, the maximum true interest cost calculation on the Series 2017A Bonds
shall not exceed 4.75% per annum.. Interest on the Series 2017A Bonds shall be paid on the
dates set forth in the Master Trust Indenture and the First Supplemental Indenture. The final
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maturity date of the Series 2017A Bonds shall not exceed thirty -one years from the date of
issuance of the Series 2017A Bonds. The Series 2017A Bonds may be sold in a manner by
which the interest thereon is excludable from gross income under the Code. The Series 2017A
Bonds shall be subject to optional redemption at the option of the City on such terns and
conditions as shall be provided for in the Master Trust Indenture and the First Supplemental
Indenture. The Series 2017A bonds shall be subject to extraordinary mandatory redemption on
such terms and conditions as shall be provided for in the Master Trust Indenture and the First
Supplemental Indenture. The Series 2017A Bonds which are tern bonds shall also be subject to
mandatory sinking fund redemption as shall be provided for in the Master Trust Indenture and
the First Supplemental Indenture.
Section 2. Pledge to Secure the Series 2017A Bonds. The City hereby approves the
pledge of Net Revenues to secure the Series 2017A Bonds, in accordance with the terms of the
Master Trust Indenture and the First Supplemental Trust Indenture. The City hereby agrees that
it will not, so long as the Series 2017A Bonds remain outstanding, grant or attempt to grant, any
parity pledge, lien or other interest in the Net Revenues to secure any other obligations of the
Enterprise, except as permitted in the Master Trust Indenture,
Section 3. Special Obligations. The Series 2017A Bonds shall be special obligations of
the City, secured by, and payable from, Net Revenues and from the funds and accounts held by
the Trustee and the City under the Master Trust Indenture and the First Supplemental Indenture,
as and to the extent therein described. The Series 2017A Bonds shall also be secured by and be
paid from such other sources as the City may hereafter provide.
Section 4. Forms of Series 2017A Bonds. The Series 2017A Bonds and the Trustee's
Certificate of Authentication to appear thereon shall be in substantially the form set forth in an
exhibit to the First Supplemental Indenture with necessary or appropriate variations, omissions
and insertions as permitted or required by the Master Trust Indenture or the First Supplemental
Indenture or as appropriate to adequately reflect the terms of the Series 2017A Bonds and the
obligation represented thereby.
Section 5. Execution of the Series 2017A Bonds. Each of the Series 2017A Bonds
shall be executed by the Mayor or the City Manager of the City (each a "Designated Officer ")
and attested by the Finance Director or Clerk of the City. Any such signatures may be by
manual or facsimile signature and the seal of the City may be impressed or printed on the Series
2017A Bonds. Additionally, each of the Series 2017A Bonds shall be authenticated by the
signature of the Trustee or an agent of the Trustee as required and permitted by the Master Trust
Indenture and the First Supplemental Indenture. Any facsimile signature of such Designated
Officer of the City shall be of the same force and effect as if such signature were manually
placed on such Series 2017A Bonds.
Section 6. Sale of the Series 2017A Bonds. The sale of the Series 2017A Bonds is
hereby approved through a negotiated sale to the Underwriter. The Mayor of the City, the City
Attorney, the City Manager and the Finance Director of the City, or any one of them, are hereby
authorized to approve the final terms of the sale of the Series 2017A Bonds subject to the terms,
conditions and restrictions set forth in this Resolution.
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The Series 2017A Bonds shall be sold with an underwriter's discount and /or underwriting
fee as set forth in the Bond Purchase Contract, not to exceed 0.75% of the aggregate principal
amount of the Series 2017A Bonds, and subject to the terms and conditions set forth in the Bond
Purchase Contract. Additionally, the Series 2017A Bonds may be sold to the Underwriter at a
discount or at a premium.
Section 7. Approval of Bond Documents; Authorization for Execution. The forms,
terms and provisions of the Master Trust Indenture, the First Supplemental Indenture, the Bond
Purchase Contract and the Continuing Disclosure Certificate (collectively, the "Bond
Documents ") are in all respects approved and the Mayor of the City, the City Manager, the
Finance Director of the City, the City Attorney and such other officers as are specified by each of
the respective Bond Documents (together with any designee in writing of any such officer; all
references hereinafter in this resolution to any officer of the City shall be deemed to include any
designee in writing of such officer) are hereby authorized, empowered and directed to execute,
acknowledge and deliver each of the Bond Documents including counterparts thereof, in the
name and on behalf of the City. The Bond Documents, as executed and delivered, shall be in
substantially the forms now before this meeting and hereby approved, or with such changes
therein (including any changes required by a municipal bond insurer or insurers (if any) in order
to obtain a municipal bond insurance policy or policies (if any) with respect to the Series 2017A
Bonds or a reserve fund surety policy or policies (if any)) as shall be approved by the officer or
officers of the City executing the same; the execution thereof shall constitute conclusive
evidence of the City's approval of any and all changes or revisions therein from the forms of the
Bond Documents now before this meeting; and from and after the execution and delivery of the
Bond Documents, the officers, agents and employees of the City are hereby authorized,
empowered and directed to do all such acts and things and to execute all such documents as may
be necessary to carry out and comply with the provisions of the Bond Documents.
Section 8. Approval of Preliminary Official Statement. The Preliminary Official
Statement, substantially in the form presented to this meeting, is in all respects hereby approved
to be used in connection with the offering and sale of the Series 2017A Bonds to the public. The
Preliminary Official Statement shall be in substantially the form now before this meeting and
hereby approved, or with such changes therein as shall be approved by the Mayor of the City, the
City Manager and the Finance Director of the City, or any one of them. The Preliminary Official
Statement shall be circulated (via printed format and/or electronic means) for use in offering and
selling the Series 2017A Bonds at such time or times as the Mayor of the City, the City Manager,
the Finance Director of the City, or any one of them (after consultation with the City's
financial /municipal advisors, bond counsel and disclosure counsel and such other advisors the
City believes to be useful) shall determine that the Preliminary Official Statement is final within
the meaning of Rule 15c2 -12 promulgated under the Securities Exchange Act of 1934, as
amended ( "Rule 150-12 "), except for the omission of certain information described in
paragraph (b)(1) of Rule 15c2 -12, and any such action previously taken is hereby confirmed,
ratified and approved. The Underwriter is hereby authorized to distribute (via printed format
and /or electronic means) the Preliminary Official Statement, in connection with the offering and
sale of the Series 2017A Bonds to the public.
Section 9. Approval of Official Statement. Prior to the final delivery of the Series
2017A Bonds, the City shall provide for the preparation, publication, execution and delivery of
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the final Official Statement relating to the Series 2017A Bonds in substantially the form of the
draft Preliminary Official Statement presented to this meeting. The Mayor of the City, the City
Manager, the Finance Director of the City, or any one of them, are hereby authorized and
directed to execute and deliver the final Official Statement, and any supplements thereto, in the
name of and on behalf of the City, and to make any changes or revisions necessary to the
Preliminary Official Statement in order for the final Official Statement relating to the Series
2017A Bonds to meet the requirements of the City under the Bond Purchase Contract. The
execution thereof shall constitute conclusive evidence of the City's approval of any and all
changes or revisions therein from the form of the Preliminary Official Statement now before this
meeting. The Official Statement shall be circulated (via printed format and /or electronic means)
for use in selling the Series 2017A Bonds at such time or times as the Mayor of the City, the City
Manager, the Finance Director of the City, or any one of them (after consultation with the City's
financial advisor, bond counsel and disclosure counsel and such other advisors the City believes
to be useful), shall determine that the Official Statement relating to the Series 2017A Bonds is
each a "final official statement" within the meaning of Rule 15c2 -12. The Underwriter is hereby
authorized to distribute (via printed format and /or electronic means) the Official Statement, in
connection with the sale of the Series 2017A Bonds to the public.
Section 10. Trustee, Paying Agent and Registrar. The City hereby appoints U.S.
Bank National Association as Trustee, paying agent and registrar for the Series 2017A Bonds.
Such appointments shall be effective upon the issuance of the Series 2017, and shall remain in
effect until the City shall, by supplemental agreement or by resolution, time a substitute or
successor thereto.
Section 11. Authorization for Provision for Reserve Fund. If determined by the
Finance Director of the City to be necessary or desirable, a portion of the proceeds of the Series
2017A Bonds may be used to fund a debt service reserve fund for the Series 2017A Bonds, or to
pay the costs of a reserve fund surety bond or any other security device for a debt service reserve
fund as may be provided for in the Master Trust Indenture and First Supplemental Indenture.
Section 12. Appointment of Financial Advisor. The City hereby appoints Fieldman,
Rolapp & Associates Inc., as Financial Advisor, in connection with the issuance of the Series
2017A Bonds.
Section 13. Additional Authorization. The Mayor of the City, the City Manager, the
Finance Director of the City, the City Attorney and all officers, agents and employees of the
City, for and on behalf of the City, be and they hereby are authorized and directed to do any and
all things necessary to effect the execution and delivery of the Series 2017A Bonds, the Bond
Documents, the Preliminary Official Statement and the final Official Statement and to carry out
the terns thereof. The Mayor of the City, the City Manager, the Finance Director of the City, the
City Attorney and all other officers, agents and other employees of the City are further
authorized and directed, for and on behalf of the City, to execute all papers, documents,
certificates and other instruments that may be required in order to carry out the authority
conferred by this Resolution and by the Series 2017A Bonds, the Bond Documents, the
Preliminary Official Statement and the final Official Statement or to evidence the same authority
and its exercise. The foregoing authorization includes, but is in no way limited to, (i) authorizing
City staff to pay costs of issuance of the Series 2017A Bonds and the underwriting fees,
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(ii) authorizing the Finance Director of the City to direct the investment of the proceeds of the
Series 2017A Bonds in one or more of the permitted investments provided for under the Master
Trust Indenture and the First Supplemental Indenture (including, but not limited to, investment
agreements) and to execute any documents relating to such investments, and (iii) authorizing the
execution by the Mayor of the City, the City Manager, the Finance Director of the City, or any of
them, of a tax compliance certificate as required by the Master Trust Indenture and the First
Supplemental Indenture for the purpose of complying with the arbitrage and rebate requirements
of the Code, any documents required by The Depository Trust Company in connection with the
Book -Entry Bonds (as defined in the First Supplemental Indenture), any documents required by
the provider of reserve fund surety bond, if any, required to fund a reserve fund for the Series
2017A Bonds and any documents required to obtain a municipal bond insurance for all or a
portion of the Series 2017A Bonds to the extent such bond insurance shall result in cost savings
to the City.
Section 14. Costs of Issuance. The City authorizes funds of the City, together with the
proceeds of the Series 2017A Bonds, to be used to pay costs of issuance of the Series 2017A
Bonds, including, but not limited to, costs and expenses of attorneys, accountants,
municipal/financial advisors, underwriting fees, costs associated with rating agencies,
remarketing agents (if any), liquidity providers (if any), the Trustee, bond insurance and surety
bonds (if any), printing, publications and mailing expenses and any related filing fees thereof.
Section 15. Severability. The provisions of this Resolution are hereby declared to be
severable and, if any section, phrase or provisions shall for any reason be declared to be invalid,
such declaration shall not affect the validity of the remainder of the sections, phrases and
provisions hereof.
Section 16. Governing Law. This resolution shall be construed and governed in
accordance with the laws of the State of California.
Section 17. Repeal of Inconsistent Resolutions. All other resolutions of the City, or
parts of resolutions, inconsistent with this Resolution, are hereby repealed to the extent of such
inconsistency.
Section 18. Effective Date of Resolution. This Resolution shall take effect immediately
upon its passage.
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I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the City
Council of the City of Bakersfield at a regular meeting thereof held on September 6th, 2017, by
the following vote:
COUNCILMEMBERS_ RIVERA, GONZALES. WEIR SMITH, FREEMAN, SULLIVAN. EARLIER
AYES. COUNCILMEMBER Q (SILC �Llij +✓ Sull�vcu Purl er
NO COUNCILMEMBER
ABSTAIN. COUNCILMEMBER N
ABSENT: COUNCILMEMBER Nan
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CHRISTOP R GERRY, Acting
City Clerk and Ex Officio Clerk
of the Council of the City of Bakersfield
APPROVED this 6`h day of September, 2017
KAREN GOH
Mayor of the City of Bakersfield
APPROVED AS TO FORM:
VIRGINIA GENNARO
City Attome
By:=(J
VIRGIN GEM ARO
City Attomey
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