HomeMy WebLinkAboutRES NO 95-93RESOLUTION NO.
95-93
RESOLUTION ORDERING A CHANGE AND MODIFICATION
TO SCOPE OF WORK ~ COST OF IMPROVEMENTS
TO ALLOCATE IMPROVEMENT BOND PROCEEDS
FOR PAYMENT OF CERTAIN INCIDENTAL EXPENSES
CITY OF BAKERSFIELD
ASSESSMENT DISTRICT NO. 90-1
(JEWETTA TRUNK SEWER/CALLOWAY CANAL RELOCATION)
RESOLVED by the City Council of the City of Bakersfield,
California (the "City"), as follows:
WHEREAS, on May 22, 1991, the city Council adopted
Resolution No. 78-91 whereby the City Council adopted the
engineer's report (the "Report"), confirmed the assessment and
ordered work and improvements (collectively, the "Improvements") to
be constructed and acquired in City of Bakersfield Assessment
District No. 90-1 ("A.D. 90-1"); the total estimated cost of
constructing and acquiring the Improvements and all incidental
expenses in connection therewith was $4,412,000.00; and
WHEREAS, on June 5, 1991, the City Council adopted
Resolution No. 99-91 whereby the city Council confirmed the list of
unpaid assessments within A.D. 90-1 and ordered issuance of
improvement bonds (the "Bonds"), secured by the unpaid assessments,
to finance the costs and expenses of constructing and acquiring the
Improvements and incidental expenses in connection therewith; and
WHEREAS, the Bonds, in the aggregate principal amount of
$4,357,580.00, were sold on June 19, 1991, and are now outstanding;
and
WHEREAS, due to unforeseeable circumstances beyond the
city's control, the estimated costs allocated in the engineer's
report for items of Improvements and incidental expenses will not
be expended for those items and, as a result, there are now in the
improvement fund for A.D. 90-1 (the "Improvement Fund") unexpended
proceeds in a total amount of approximately $603,956.00,
representing the amount of unexpended estimated Improvement costs,
plus earnings thereon, as shown on Exhibit A, which is attached to
and incorporated in this resolution; and
WHEREAS, pursuant to Section 148(f) (4) (C) of the Internal
Revenue Code and Treasury Regulation 1.148-6, the City will be
required to pay periodically a one and one-half percent penalty on
all construction proceeds in the Improvement Fund that have not
been expended for the governmental purposes of the Bonds prior to
July 2, 1993; and
WHEREAS, payment of interest on the Bonds is a
governmental purpose of the Bonds for purposes of Internal Revenue
Code Section 148(f) (4) (C) and Treasury Regulation 1.148-6; payment
of interest on the Bonds is also a proper incidental expense of
A.D. 90-1 under applicable California law; and
WHEREAS, it is in the best interests of the city, the
owners of property subject to assessment in A.D. 90-1 and the
public generally that the amounts remaining unexpended in the
Improvement Fund be allocated and used to pay interest on the
Bonds, thereby reducing and eventually eliminating the City's
liability for the above-described penalty; and
WHEREAS, such allocation and use requires a change and
modification to certain items in the scope of work and estimated
costs for A.D. 90-1, but will not increase the total amount of the
assessment or any individual assessment; accordingly, pursuant to
California Streets & Highways Code subdivision 10352(b) (1), such
change and modification may be ordered without a noticed public
hearing;
THEREFORE, THE CITY COUNCIL FINDS, DETERMINES AND ORDERS
as follows:
1. The scope of work for A.D. 91-1 is modified to add,
as an item of miscellaneous construction incidental cost (item VI
of Exhibit B of the Report), "Payment of Interest Installments on
Bonds," and the cost of the Improvements for A.D. 90-1 is modified
to allocate to this item an estimated cost of $603,956.00. This
amount represents a reallocation of unexpended proceeds from those
cost items listed on Exhibit A, plus earnings thereon.
2. Prior to July 2, 1993, all unexpended construction
proceeds in the Improvement Fund, plus earnings thereon, in the
approximate amount of $603,956.00, shall be transferred from the
Improvement Fund and deposited into a separate account. The
account, including all earnings thereon, shall be used solely to
(i) make transfers to the redemption fund for the Bonds (the
"Redemption Fund") to pay installments of interest on the Bonds as
such installments become due, and (ii) pay any penalty amount due
to the United States from time to time pursuant to Internal Revenue
Code Section 148(f)(4)(C) and Treasury Regulation 1.148-6, until
such account is depleted.
3. The officers of the City are authorized and directed
to execute all documents, including but not limited to any
agreement with or directions to Bank of America National Trust and
Savings Association as transfer agent, registrar and paying agen~
for the Bonds, and to take all other actions as may be appropriate
or necessary to carry out the transactions contemplated by this
resolution.
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I HEREBY CERTIFY that the foregoing resolution was passed
and adopted by the City Council of the City of Bakersfield,
California, at a regular meeting thereof held on June 9, 1993 ,
1993, by the following vote:
AYES:
NOES:
COUNCILMEMBERS: MCDERMOTt, EDWARDS, DEMONs, SMITH,
KANE, SALVAGGIO
COUNCILMEMBERS: NONE
ABSENT:
COUNCILMEMBERS: BRUNNI
ABSTENTIONS:
COUNCILMEMBERS: NONE
City of Bakersfield
APPROVED this 9TH day of June, 1993
MAYOR ~t~C~f Bakersfield
COUNTERS~NED:
APPROVED AS TO FORM:
Jackson Hargrove Em~ich
Pedreira & Nahigian
BOND COUNSEL
APPROVED AS TO FORM:
CITY ATTORNEY of th~'J
city of Bakersfield
?003700H.R01
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ORIGINAL