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ORD 59-79 SEWER REVENUE BONDSTOWN OF WINSLOW, WASHINGTON ORDINANCE NO. ~ q AN ORDINANCE amending Ordinance No. 78, passed April 7, 19593 providing for the issuance and sale of $45,000.00 par value of "Sewer Revenue Bonds, 1959," for the purpose of providing the funds with which to carry out the system or plan for making additions to and betterments and extensions of the existing system of sewerage of the Town, as adopted by Ordinance No. 78~ fixing the date, form, maturities, interest rate, terms and covenants of said bonds~ providing for the sale of said bonds to McLean & Co., Inc., of Tacoma~ and declaring an emergency. WHEREAS, the Town of Winslow, by Ordinance No. 78, passed the 7th day of April, 1959, adopted a system or plan for making additions to and bet- ferments and extensions of the existing system of sewerage of the Town, and authorized the issuance and sale of sewer revenue bonds in the principal sum of not to exceed $50,000.00 to provide the funds required to pay the cost of acquiring, constructing and making said additions to and betterments and extensions of said system of sewerage~ and WHEREAS, the Town Council now deems it advisable to issue and sell $45,000.00 par value of said total authorized issue of sewer revenue bonds to obtain the funds required to pay the cost of carrying out said system or plan~ and WHEREAS, the Town of Winslow has heretofore issued, pursuant to Ordinance Noo 24, $50,000.00 par value of "Sewer Revenue Bonds, 1953," and by subparagraph (e) of Section 8 of said Ordinance No. 24, the Town reserved the right, for the purpose of acquiring, constructing and installing additions and extensions of and acquiring necessary equipment for or making necessary replacements or other capital improvements to the system of sewerage, to issue additional sewer revenue bonds and to create a special fund for the payment of the principal and interest thereof, into which fund payments may be made from the Sewer Revenue Fund of the Town sufficient to pay the principal of and interest on such additional bonds and to maintain an adequate reserve therefor, which such payments may rank equally with the payments out of the Sewer Revenue Fund into the "WinsIow, 1953, Sewer Revenue Bond Redemption Fund" and Reserve Account created therein, upon compliance with the following conditions: "First, that at the time of the issuance of such addi- tional or refunding bonds there is no deficiency in the Bond Redemption Fund and Reserve Account created herein or in any bond redemption fund or reserve account which may have been created for the payment of the principal and interest of any sewer revenue bonds issued on a parity with the bonds authorized herein and prior to the issuance of such additional or refunding bonds. "Second~ that at the time of the issuance of such additional or refunding bonds the town shall have on file a certificate from an independent licensed professional engineer or engineer- ing firm not then employed by the town except for the purpose of giving such certificate, showing that the net revenue of the sewer system received from the twelve months operation immed- iately preceding the issuance of such bonds equals at least 1o5 times the amount required to pay principal and interest each calendar (exclusive of any balloon maturity year) on the outstanding bonds of this issue and that such net revenue~ together with the net revenue estimated by said engineer or engineering firm to be received each calendar year thereafter~ will equal at least 1.5 times the amount required to pay the principal and interest each calendar year (exclusive of any balloon maturity year) on the outstanding bonds of this issue, on any bonds which may have been theretofore issued on a parity therewith, and on such additional or refunding bonds then being issued° "In the event that the sewer system of the town has not been in operation for twelve months immediately preceding the issu- ance of such additional bonds, the same may still be issued on a parity with the bonds authorized herein upon compliance with the conditions required in paragraph First above and upon receipt by the town of a certificate from such engineer or engineering firm showing that his or its estimate of the net revenue of such sewer system to be received each calendar year thereafter will equal at least 1.5 times the amount required to pay the principal and interest each calendar year (exclusive of any halcon maturity year) on the outstanding bonds of this issue and on such additional bonds then being issued."~ and WHEPEAS, the Town Council hereby finds and declares that there is no deficiency in the "Winslow, 1953, Sewer Revenue Bond Redemption Fund" and Peserve Account created therein for the outstanding "Sewer Revenue Bonds, 1953," and that John B. Dcdds, of Bellerue, Washington, an independent licensed pro- fessional engineer not employed by the Town except for the purpose of giving a certificate in accordance with the provisions of Ordinance No. 24, as above - 2 - provided, has certified that the net revenues of the sewer system are suffi- cient to meet the 1.5 coverage requirement above set forth, as evidenced by his certificate to such effect on file with the Town Clerk, NOW, IHERHFORH, BE IT ORDA!NED BY THE TOWN COUNCIL OF THE TOWN OF WINSLOW, WASHIN(3TON, as follows: Section 1. Section 6 of Ordinance No. 78, passed April 7, 1959, is hereby amended to read as follows: "Section 6. The cost of acquiring, constructing and making the foregoing additions to and betterments and extensions of said system of sewerage shall be paid from the proceeds received from the issuance and sale of sewer revenue bonds in an amount of not to exceed $50,000.00 par value. It is the intention of the Town to acquire and construct and complete such portions of the foregoing system or plan of additions to and betterments and extensions of the system of sewerage of the Town as from time to time the Town Council shall deem advisable. The bonds shall be issued in one or more series at such times as the Town Council shall deem advisable. The bonds shall be entitled mSewer Revenue Bonds, 1959,' with series designations following, if issued in series. The bonds shall bear interest at a rate or rates not to exceed 6~ per annum, payable semiannually, and shall be numbered from ~onet upward, consecutively, within each series as issued. The bonds shall be issued in such series; shall be in such denominations and form; shall bear such date or dates and interest rate or rates; shall be payable at such place or places; shall mature serially in accordance with such schedule, beginning not earlier than one year after date of issuance and ending not later than the reasonable life expect- ancy of the system of sewerage as added to and extended, as herein provided (herein declared to be at least 35 years); shall guarantee such coverage and collection of rates; shall guarantee such coverage and collection of rates; shall provide for such additional funds and accounts; and shall contain and be subject to such provjsion or covenants as shall be hereafter provided by ordinance." Section 2. For the purpose of obtaining the funds required to pay the cost of carrying out the system or plan for making additions to and better- ments and extensions of the existing system of sewerage of the Town, as speci- lied and adopted in Ordinance Noo 78, as herein amended, there shall be issued and sold "Sewer Revenue Bonds, 1959," of the Town of Winslow (hereinafter called the "Bonds"), in the principal amount of $45,000.00. The Bonds shall be in denominations of $1,000.00 each; shall be numbered from 1 to 45, inclu- siva; shall be dated May 15, 1959; and shall bear interest at the rate of 4 3/84 per annum, the first interest coupon to be payable on February 1, 1960, and interest to be payable thereafter semiannually on February 1 and August 1 -3'- of each year, interest to maturity to be evidenced by coupons to be attached to the Bonds with full obligation on the part of the Town to pay interest at the same rate from and after the bond maturity dates until the Bonds with interest are paid in full. Both the principal of and interest on the Bonds shall be payable in lawful money of the United States of America at the office of the Town Ireasurer solely out of the "Sewer Revenue Bond Fund, 1959," created by Ordinance No. 78 (hereinafter called the "Bond Fund"), and the Bonds shall be a valid claim of the holder thereof only as against the Bond Fund and the fixed amount of the revenues of the system of sewerage pledged to such fund and shall not be a general obligation of the Town of Winslow. The Bonds shall mature in order of their numbers in accordance with the following schedule, to wit: Bond Numbers Amounts Maturities 1 $1,000 August 1, 1964 2 $1,000 August 1, 1965 3 $1,000 August 1, 1966 4 $1,000 August 1, 1967 5 $1,000 August 1, 1968 6 $1,000 August 1, 1969 7 $1,000 August 1, 1970 8 $1,000 August 1, 1971 9 $1,000 August 1, 1972 10 $1,000 August 1, 1973 11 $1,000 August 1, 1974 12 $1,000 August 1, 1975 13 $1,000 August 1, 1976 14 $1,000 August 1, 1977 15 $1,000 August 1, 1978 16 $1,000 August 1, 1979 17 $1,000 August 1, 1980 18 $1,000 August 1, 1981 19 $1,000 August 1, 1982 ...... August 1, 1983 20 to 23, inclusive $4,000 August 1, 1984 24 to 27, " $4,000 August 1, 1985 28 to 31, " $4,000 August 1, 1986 32 to 35, " $4,000 August 1, 1987 36 to 40, " $5,000 August 1, 1988 41 to 45, " $5,000 August 1, 1989 Section 3. The Town of Winslow reserves the right to redeem any or all of the outstanding Bonds on any semiannual interest payment date on and after August 1, 1964, at par, plus accrued interest. The Bonds shall be redeemed in inverse numerical order, highest numbers first, by giving at least thirty days' notice of such intended redemption by publication thereof in the -4- official newspaper of the Town, such notice to be published once not less than thirty nor more than forty-five days prior to the call date and by mailing a copv of such notice to McLean & Company~ Inc., at its principal office in Tacoma, Washington~ or its successor, at least thirty days prior to the call date. Interest on any Bonds so called for redemption shall cease on the date fixed for such redemption upon payment of the redemption price into the Bond Fund. Section 4. The Bopd Fund is hereby divided into two accounts, namely, a "Principal and Interest Account" and a "Reserve Account." So long as Bonds are outstanding against the Bond Fund, the Town Treasurer of the Town of Winslow shall set aside and pay into the Bond Fund, after the payment of the expenses of maintenance and operation of the system of sewerage out of the gross revenues of said system, including all additions, extensions and better- ments thereof at any time made (deposited in the "Sewer Revenue Fund" created in the office of the Iowp Treasurer by Ordinance No. 24), a fixed amount with- out regard to any fixed proportion~ as follows: (a) Into the "Principal and Interest Account," an amount which shall be sufficient to pay the interest payable on the Bonds on February 1, 1960 and on August 1, 1960, such amounts to be accum- ulated in substantially equal monthly installments~ commencing with the month of June, 19591 and commencing with September 1, 1960, and on or before the 1st day of each month thereafter one- sixth of the next ensuing six months~ interest requirements for the Bonds, and commencing on September 1, 1963, and on or before the 1st day of each month thereafter one-twelfth of the next ensuing twelve monthst requirements of both principal and interest for the Bonds~ and (b) Into the "Reserve Account," monthly, beginning on August 1, 1959, rot less than $50.00 until the total sum of $3,000.00 shall have been accumulated therein, which total sum shall be accumulated by no later than July 1, 1964o The "Reserve Account" may be accumulated from any other monies which the Town of Winslow may have available for such purpose in addition to using said revenues therefor. The "Reserve Account" shall, except for authorized withdrawals therefrom, as hereinafter set forth, be maintained in such total amount at all times so long as any of the Bonds are outstanding~ PROVIDED, that when the total amount in the Bond Fund shall equal the total amount of principal and interest oD all outstanding Bonds to the last maturity thereof, no further payments need be made into the Bond Fund. -5- In the event that 'there should be a deficiency in the "Principal and Interest Account" in such Bond Fund to meet maturing installments of either principal or interest, as the case may be, such deficiency shall be made up from the "Reserve Account" by the withdrawal of cash ~herefrom for that purpose. Any deficiency created in the "Reserve Account" by reason of any such withdrawal shall then be made up from monies from the revenues of the system of sewerage deposited in the Sewer Revenue Fund first available after making the necessary provision for the required payments into the "Principal and Interest ~ccount." The monies in the "Reserve Account" shall otherwise be held intact and may be applied against the last outstanding Bonds. All money in the "Reserve Account" above provided for may be kept on deposit in the official bank depository of the Town of Winslow, or in any national bank, or may be invested in United States Government obligations maturing not later than twelve years from the date of issuance and in no event later than July 1, 1989. Interest on any such investment or on such bank deposit shall be deposited in and become a part of the "Reserve Account" until the total reserve amount shall have been accumulated therein, as aforesaid, after which such interest shall be deposited in the "Principal and Interest Account." The gross revenues from the system of sewerage, including all addi- tions thereto and betterments and extensions thereof at any time made or con- structed, are hereby pledged to such payments and the Bonds shall constitute a charge or lien upon such gross revenues prior and superior to any other charges whatsoever, excluding charges for maintenance and operation, except that the charge or lien upon such gross revenues for the Bonds shall be on a parity with the charge or lien upon such gross revenues for the outstanding "Sewer Revenue Bonds, 1953," and any additional sewer revenue or sewer revenue refunding bonds that may be hereafter issued pursuant to the provisions of Section 8 of Ordinance No. 24. If the Town shall fail to set aside and pay into the Bond Fund the amounts which it has obligated itself by this Section to set aside and pay -6- therein, the holder of any Bond may bring suit against the Town to compel it to do so. Section 5. The Town further hereby covenants and agrees with the owner and holder of each of the Bonds, as follows: (a) That it will not sell, lease, mortgage, or in any manner encumber or dispose of all the properties of the said system of sewerage now belonging to or which may here- after belong to it, including all additions, betterments and extensions thereof at any time made, unless provision is made for payment into the Bond Fund of a sum sufficient to pay the principal of and interest on all the outstanding Bonds in accordance with the terms thereof; and further hereby binds itself irrevocably not to mortgage, sell, lease or in any manner dispose of any part of the system of sewer- age, including all additions, betterments and extensions thereof at any time made, that is used, useful and material to the operation of said system of sewerage unless provision is made for replacement thereof or for payment into the Bond Fund of an amount which shall bear the same ratio to the amount of outstanding Bonds as the revenue available for debt service for said Bonds for the twelve months preceding such sale, lease, encumbrance or disposal from the portion of the system so leased, encumbered or disposed of bears to the revenue available for debt service for said Bonds from the entire utility for the same period. Any such money so paid into the Bond Fund shall be used to retire outstanding Bonds at the earliest possible date. (b) That it will maintain in good condition and operate said system of sewerage, and will establish, maintain and collect such rates as will produce gross revenues from the said system of sewerage sufficient to permit payment into the Bond Fund of the amounts required for the payment of the principal of and interest on the Bonds as they become due and the amounts that are required to be paid into the "Reserve Account" therein and, in addition thereto, that it will pay all costs of maintenance and operation, and taxes, and meet the debt service requirements of the out- standing "Sewer Revenue Bonds~ 1953," dated August 1, 1953. (c) That it will, while any of the Bonds remain out- standing, keep proper books of accounts and records separate and apart from other accounts and records, in which complete and correct entries will be made of all transactions relating to the said system of sewerage, and it will furnish the ori- ginal purchaser of said Bonds, or any subsequent holder or holders thereof, complete operating and income statements of said system of sewerage, in reasonable detail, covering any fiscal year~ and it will grant any holder or holders of at least twenty-five per cent (25~) of the outstanding Bonds the right at all reasonable times to inspect said system and all of the records, accounts and data of the Town relating thereto. Upon request of any holder of any of said Bonds, it will also furnish to such holder a copy of the most recently completed audit of the Townts accounts by the State Auditor of Washington. - 7 - (d) That it will establish, maintain and collect such rates and charges for sanitary sewage disposal service as long as any of the Bonds are outstanding as will make available for the payment of the Fzincipal of and interest on all such Bonds and on any outstanding "Sewer Revenue Bonds, 1953," and any bonds hereafter issued on a parity with said "Sewer Revenue Bonds, 1953," and the Bonds, in accordance with the provisions of Section 8 of Ordinance No. 2~ as the same shall become due, an amount equivalent to at least 1.5 times the amount required each calendar year to pay all of such principal and interest (except for any balloon maturity year as defined in Ordinance Noo 24) after deducting the necessary costs of maintenance, operation and taxes from the gross revenues of its system of sewerage° (e) That it will not furnish sanitary sewage disposal ser- vice to any customer whatsoever free of charge and it shall, not later than sixty (60) days after the end of each calendar year, take such legal action as may be feasible to enforce collection of all collectible delinquent accounts and, i.n addition thereto, shall promptly avail itself of its utility lien rights, as set forth in RCW 35.67.200, et seq., arid all acts amendatory thereof. (f) That it will carry the types of insurance on its system of sewerage properties in the amounts normally cartled by prl- rate sewer companies engaged in the operation of sewerage systems, and the cost of such insurance shall be considered a part of operating and maintaining said system. If, as, and when, the United States of Amerlca, or some agency thereof, shall provide for war risk insurance, the Town further agrees to take out and maintain such insurance on all or such portions of said system on which such war risk insurance may be written in an amount or amounts to cover adequately the value thereof. Section 6o The Bonds shall be in substantially the following form: No. $1,000.00 UNITED STATES OF AMERICA STATE OF WASHINGTON TOWN OF WINSI.OW SEWER REVENUE BOND, 1959 KNOW ALL MEN BY THESE PRESENTS: That the Town of Winslow, Kitsap County, State of Washington, for value received, hereby promises to pay to the bearer on the 1ST DAY OF A[GUST, 19__, the principal sum of ONE THOUSAND DOLLARS together with interest thereon at the rate of FO[~ AND THREE- EIGHTHS:PER CENT (4 3/8~) per annum, payable semiannually on February 1st and August 1st of each year, upon the presentation and surrender of the attached interest coupons as they severally -8- mature up to the bond maturity date and with full obliga- tion on the part of the Town to pay interest at the same rate, from and after the bond maturity date, until this bond with interest is paid in full, or until this bonds, if callable, shall have been duly called for redemption and the redemption price, including interest to such call date, deposited in the "Sewer Revenue Bond Fund, 1959," of the Town. Both principal of and interest on this bond are payable in lawful money of the United States of America at the office of the Town Treasurer of Winslow, Washington, solely out of the special fund created by Ordinance No. 78 and known as the "Sewer Revenue Bond Fund, 1959" (herein- aft.= called the "Bond Fund"), into which fund the Town of Winslow hereby irrevocably binds itself to pay certain fixed amounts out of the 9ross revenues of the system of ~ewerage, now belonging to or which may hereafter belong to the Town, including all additions, replacements, exten- sions and betterments now or at any time hereafter made or constructed, without regard to any fixed proportion, namely, an amount sufficient to pay the principal of and interest on this issue of bonds as they respectively become due and to create a reserve in the total sum of $3,000.00, all at the times and in the manner set forth in Ordinance No. . The bonds of this issue are not a general obligation of the Town. This bond is one of a total issue of $45,000.00 par value of bonds, all of like date, tenor and effect, except as to matUrities~ all payable from the said Bond Fundr and all issued by the Town under and pursuant to the laws of the State of Washington and Ordinances Nos. 78 and of the Town for the purpose of obtaining the funds with which to carry out the system or plan for making additions to and betterments and extensions of the existing system of sewer- age of the Town. ~eference is made to said Ordinances as more fully describing the covenants with and rights of holders of bonds of this issue. The Town of Winslow has reserved the right to redeem any or all of the outstanding bonds of this issue on any semiannual interest payment date on and after August 1, 1964, at par, plus accrued interest. The bonds of this issue shall be redeemed in inverse numerical, highest numbers first, by giving at least thirty dayst notice of such intended redemption by publication thereof in the official newspaper of the Town, such notice to be published once not less than thirty nor more than forty- five days prior to the call date and by mailing a copy of such notice to McLean & Company~ Inc., at its principal office in Tacoma, Washington, or its successor, at least thirty days prior to the call date Interest on bonds so called for redemp- tiori shall cease on the date fixed for such redemption upon payment of the redemption price into the Bond Fund. The bonds of this issue constitute a charge or lien upon the gross revenues of the system of sewerage of the Town, together with all additions thereto and betterments and extensions and replacements thereof at any time made, prior and superior to any other charges whatsoever, excluding charges for maintenance and operation of sa].d system, except that the charge or lien upon such gross revenues for the bonds of this issue are on a parity with the charge or lien upon such gross revenues for the outstanding "Sewer Revenue Bonds, 1953," and any additional sewer revenue or sewer revenue refunding bonds that may be here- after issued pursuant to the provisions of Section 8 of Ordinance No. -9- The Town of Winslow hereby covenants and agrees with the holders of this bond that it will keep and perform all covenants of this bond and of Ordinances Nos. 78 and to be by it kept and performed, and it further covenants and agrees to maintain in good condition and to operate said system of sewerage, and to establish, maintain and collect such rates and charges in connection therewith as will pro- duce the gross revenues necessary to meet the obligations of the said Town as herein set forth and as. set forth in Ordinances Nos. 78 and . Yt is hereby certified and declared that the bonds of this issue are issued pursuant to and in strict compliance with the Constitution and laws of the State of Washington and the ordinances of the Town of Winslow, and that all acts, condi- tions and things required to be done precedent to and in the issuance of this bond have happened, been done and been per- formed as required by law. IN WITNESS WHEREOF, the Town of Winslow, Washington, has caused this bond to be signed by its Mayor and attested by its Clerk and its corporate seal to be hereto affixed, and the interest coupons attached to be signed with the facsimile signatures of said officials this 15th day of May, 1959. TOWN OF WINSLOW, WASHINGTON BY ATTEST: CLERK The interest coupons attached to the Bonds shall be in substantially the following form: On the 1st day of (February)(August), 19 ., THE TOWN OF WINSLOW, WASHINGTON, upon presentation and surrender of this coupon, will pay to bearer at the office of the Town Treasurer the sum of DOLLARS ($. . ) in lawful money of the United States of America from the spe- cial fund of the Town known as "Sewer Revenue Bond Fund, 1959," said sum being six months' interest then due on its "Sewer Revenue Bonds, 1959," dated May 15, 1959, and numbered . Coupon No. $ TOWN OF WINSLOW, WASHINGION BY ~,YOR ATTEST: CLERK - 10 - The Bonds sh~l be printed on lithegraphed forms, shall be signed by the Mayor and attested by the Clerk, and shall have the seal of the Town of Winslow affixed thereto and the interest coupons shall bear the facsimile signatures of the Mayor and the Clerk. Section 7. McLean & Company, Inc., of Tacoma, Washington, has sub- mitted an offer to purchase the Bonds at a price of $96.00 per each $100.00 par value thereof, plus accrued interest from the date of issuance to the date of delivery of the Bonds, the Town to furnish the printed Bonds and the unqual- ified approving legal opinion of Messrs. Weter, Roberrs & Shefelman, municipal bond counsel of Seattle, Washington, at the TownIs expense. The Town Council is of the opinion that no better price can be obtained for the Bonds and that it is in the best interests of the Town to accept said offer and said offer is hereby accepted. The Bonds shall, therefore, immediately upon their execution, be delivered to said purchaser upon payment for the same in accordance with said offer. The principal amount received from the payment for the Bonds shall be deposited in the "Sewer Construction Fund" of the Town, and shall be expended in accordance with the provisions of Section 10 of Ordinance No. 78~ as herein amended, and the accrued interest received shall be deposited in the Bond Fund. Section 8. This ordinance is declared to be one necessary for the immediate preservation of the public peace, property, health and safety of the people of ~he Town of Winslow, Washington. An emergency is hereby declare to exist, and this ordinance is hereby declared to be in full force and effect from and after its passage~ approval and publication as provided by law. PASSED by the Town Council of the Town of Winslow, Washington, and APPROVED by jts Mayor at a regular meeting held on the 5th day of May, 1959. ATTES://~ ~ - ll -