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HomeMy WebLinkAboutRESOLUTION NO. 08-01-06wow STATE OF GEORGIA COUNTY OF FULTON RESOLUTION NO. 08-01-06 RESOLUTION AUTHORIZING, AMONG OTHER THINGS, THE ISSUANCE AND SALE OF TAX ANTICIPATION NOTES IN THE AGGREGATE PRINCIPAL AMOUNT OF $5,450,000 BE IT RESOLVED by the City Council of the City of Milton, GA while in regular session on January 10, 2008 at 7:00 pm. as follows: WHEREAS, the City of Milton (the "City") has been duly created and is validly existing as a municipal corporation of the State of Georgia; and WHEREAS, the Mayor and Council of the City are charged with the duties of contracting debts and managing the affairs of the City (the "Governing Body"); and WHEREAS, the City is authorized by Article IX, Section V, Paragraph V of the Constitution of the State of Georgia and Section 36-80-2 of the Official Code of Georgia Annotated, to incur a temporary loan in order to pay current expenses during any calendar year; and WHEREAS, the Governing Body has determined that it is in the best interest of the City to incur a temporary loan in order to pay current expenses for calendar year 2008 in anticipation of the receipt of taxes levied or to be levied for its general fund (the "General Fund"); and WHEREAS, the City proposes to issue its Tax Anticipation Notes in the aggregate principal amount of $5,450,000 ("TANS" or "Notes") to pay the current expenses of the City. NOW, THEREFORE, BE IT RESOLVED by the Governing Body of the City and it is hereby resolved by authority of the same, as follows: Section 1. Findings. The Governing Body hereby finds and determines the following: (a) the aggregate principal amount of the TANS authorized herein does not exceed 75% of the total gross income from taxes which have been collected by the City in calendar year 2007; (b) the TANS authorized herein shall be paid in full on or before December 31, 2008; (c) no temporary loan or other contract, note, warrant or other obligation for current expenses incurred in calendar year 2007 or any prior calendar year remains unpaid as of the date hereof, during the calendar year 2008; (d) the City to date has made no other temporary loans or other contracts, notes, warrants or obligations for current expenses; (e) the aggregate principal amount of the TANS herein authorized, together with other contracts, notes, warrants or obligations of the City incurred since January 1, 2008 for expenses in calendar year 2008, do not exceed the -1- total anticipated tax revenues of the City for calendar year 2008; (e) the money authorized to be borrowed will become part of the general revenues of the City and deposited into the General Fund; and (f) a need exists for the City to borrow $5,450,000 to pay current expenses of the City in calendar year 2008 prior to the receipt of sufficient revenues from taxes levied or to be levied for 2008. Section 2. Authorization of Notes. There is hereby authorized to be issued tax anticipation notes in the aggregate principal face amount of $5,450,000 which shall be designated "City of Milton (Georgia) Tax Anticipation Notes, Series 2008." The Notes shall be issued as fully registered Notes numbered R-1 and upward; shall be dated as of the date of delivery thereof; shall be in denominations of $100,000 and any integral multiple of $5,000 in excess thereof not exceeding the principal amount of the Note; shall mature on December 31, 2008; shall bear interest from their date payable on December 31, 2008, at such rate or rates as may be determined by the City Manager at the time of the sale thereof, calculated on the basis of a 360 -day year (comprised of twelve 30 day months). The Notes shall be executed by the manual or facsimile signature of the Mayor and by the manual or facsimile signature of the Clerk, and the corporate seal of the City shall be impressed or imprinted thereon. In case any officer whose signature shall be affixed to the Notes or who shall have sealed the Notes shall cease to he such officer before the Notes so signed and sealed shall have been actually delivered, the Notes, nevertheless, shall be valid Notes of the City and may be delivered as such notwithstanding the fact that such officer or officers may have ceased to be such officer or officers of the City when the Notes shall be actually delivered. The Notes shall not be subject to redemption prior to the stated maturity. Both the principal of and interest on the Notes shall be payable in any coin or currency of the United States of America which is, at the time of payment, legal tender for public and private debts. Initially, the City shall be the registrar and paying agent (the "Registrar/Paying Agent") for the Notes. If a Registrar/Paying Agent shall be utilized other than the City, it must be a bank, trust company, depository or transfer agent located either within or without the State of Georgia. Section 4. Approval of Form of Notes. The Notes as initially issued shall be issued in substantially the form attached hereto as Exhibit 1 with such changes, insertions or omissions as may be approved by the Mayor, and the execution and delivery of the Notes shall be conclusive evidence of such approval. Section 5. Tax Revenues Used to Repay s. The City agrees to use for payment of the Notes and the interest thereon a sufficient portion of the revenues received by the City from taxes levied or to be levied for calendar year 2008 for the General Fund and other funds available for such purpose. Section 6. Authentication of Notes. Only such Notes as shall have endorsed thereon a certificate of authentication substantially in the form set forth below duly executed by -2- the Registrar/Paying Agent shall be deemed to be validly issued hereunder. No Notes shall be valid or obligatory for any purpose unless and until such certificate of authentication shall have been executed by the Registrar/Paying Agent, and such executed certificate of the Registrar/Paying Agent upon any such Note shall be conclusive evidence that such Note has been authenticated and delivered hereunder. Said certificate of authentication on any Note shall be deemed to have been executed by the Registrar/Paying Agent, but it shall not be necessary that the same authorized signatory sign the certificate of authentication on all of the Notes. Section 7. Transfer and Exchange of Notes. The Registrar/Paying Agent shall cause to be kept books for the registration of transfer of the Notes. The Notes may be registered as transferred on the books of registration by the registered owner thereof in person or by his duly authorized attorney, upon surrender thereof, together with a written instrument of transfer executed by the owner or his duly authorized attorney. Upon surrender for registration of transfer of any Note to the office of the Registrar/Paying Agent, the City shall execute, and the Registrar/Paying Agent shall authenticate and deliver in the name of the transferee or transferees, a new Note or Notes of the same aggregate principal amount and tenor and of any authorized denomination or denominations, numbered consecutively in order of issuance according to the records of the Registrar/Paying Agent. The Notes may be exchanged at the office of the Registrar/Paying Agent for an equal aggregate principal amount of Notes of the same aggregate principal amount and tenor and of any authorized denomination or denominations. The City shall execute, and the 0" Registrar/Paying Agent shall authenticate and deliver, Notes which the owner of Notes making such exchange is entitled to receive, bearing numbers not contemporaneously then outstanding. Such transfers of registration or exchanges of Notes shall be without charge to the owner of such Notes, but any tax or other governmental charge, required to be paid with respect to the same shall be paid by the owner of the Note requesting such transfer or exchange as a condition precedent to the exercise of such privilege. All Notes surrendered upon any transfer provided for in this resolution shall be promptly cancelled by the Registrar/Paying Agent and shall not be reissued. Upon request of the City a certificate evidencing such cancellation shall be furnished by the Registrar/Paying Agent to the City. Section 8. Registered Owners. The person in whose name any Note shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of either principal or interest shall be made only to or upon the order of the registered owner thereof or his duly authorized attorney, but such registration may be changed as hereinabove provided. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Note to the extent of the sum or sums so paid. Section 9. Mutilated or Destroyed Notes. In case any Note shall become soon mutilated or be destroyed or lost, the City, may cause to be executed, authenticated and delivered a new Note of like date and tenor in exchange or substitution for any such Note upon, in the case of a mutilated Note, surrender of such Note, or in the case of destroyed or lost Note, the owners 0" -3- .••� filing with the City, the Registrar/Paying Agent evidence satisfactory to them that such Note was destroyed or lost and providing indemnity satisfactory to them. If any such Note shall have matured, instead of issuing a new Note, the City may pay the same. Section 10. General Authority. From and after the date of adoption of this resolution, the Mayor and the officers of the City are hereby authorized to do such acts and things, and to execute and deliver all such certificates or agreements as may be necessary or desirable in connection with the issuance of the Notes. All actions of the Governing Body, officers or agents of the City taken in connection therewith prior to the date hereof are hereby ratified and confirmed. Section 11. Bank Qualification Designation. The Notes are hereby designated as a qualified tax exempt obligations for purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"); and the City hereby certifies that the City, together with its subordinate entities (as defined in the Code), has not issued nor does it intend to issue more than $539,250 of qualified tax-exempt obligations (other than private activity bonds as defined in Section 141 of the Code) during the calendar year in which the Notes are issued. Section 12. Arbitrage Covenant. The City anticipates that no rebate of any investment earnings to the Department of Treasury of the United States will be required by Section 148(f) of the Internal Revenue Code of 1986, as amended, at any time while the TANS are outstanding. However, in the event such rebate is required, the City hereby covenants to pay or cause to be paid to the United States any and all amounts required to be paid to the United States pursuant to said Section 148(f). Section 13. Bond Counsel. The law firm of Troutman Sanders LLP is hereby designated as bond counsel for the issuance of the TANS by the City. Section 14. Payees. If Purchaser, designates a payee on the Notes other than the Purchaser, the Notes shall be made payable to such designated payee. Section 15. Award of Notes. The City hereby approves [PURCHASER] (the "Purchaser") as the winning bidder of the Notes and awards the Notes to the Purchaser upon the bid submitted by Purchaser attached hereto as Exhibit B. Section 16. Effective Date. This resolution shall be in full force and effect immediately upon its adoption, and any and all resolutions or parts of resolutions in conflict with this resolution shall be, and they are, to the extent of such conflict, hereby repealed. -4- Adopted and approved by the Governing Body of the City on January 10, 2008. CITY OF MILTON, GEORGIA By: Joe Lockwood, or Attest: i ette R. Marchiafava, City Cler (Seal) -5- EXHIBIT 1 FORM OF NOTE UNITED STATES OF AMERICA STATE OF GEORGIA CITY OF MILTON, GEORGIA TAX ANTICIPATION NOTES, SERIES 2008 Number R-1 Maturity Date: December 31, 2008 Date of 1 issue: January _, 2008 Principal Amount: $5,450,000 am" Registered Owner: KNOW ALL MEN BY THESE PRESENTS: CITY OF MILTON, GEORGIA, a municipal corporation of the State of Georgia (the "City"), for value received, hereby promises to pay the principal amount set forth above in immediately available funds, on the maturity date set forth above, to the Registered Owner, or its assignee, at such location as the Registered Owner, or its assignee, shall direct in writing. The City also promises to pay interest on the unpaid principal amount at a rate equal to , per annum (calculated on the basis of a 360 -day year comprised of twelve 30 -day months), in immediately available funds, on the maturity date set forth above, to the registered owner hereof. Both principal hereof and interest hereon are payable in lawful money of the United States of America. This Note is not subject to redemption or prepayment prior to maturity. This note is authorized by a resolution (the "Resolution") duly adopted by the Mayor and Council (the "Governing Body") of the City on January 10, 2008, in accordance with Article IX, Section V, Paragraph V of the Constitution of the State of Georgia and Section 36- 80-2 of the Official Code of Georgia Annotated for the purpose of making a temporary loan to pay current expenses of the City in calendar year 2008. Pal" This Note is issued in anticipation of the receipt of taxes levied or to be levied for the general fund in calendar year 2007. The principal amount of this Note together with all other temporary loans, notes, warrants or similar obligations does not exceed 75% of the total revenues 1 from taxes which have been collected by the City in calendar year 2007 and does not exceed, together with other contracts, notes, warrants and obligations of the City for calendar year 2008 payable from the general fund, the total anticipated revenues from taxes of City for calendar year �.. 2008. It is hereby certified, recited and declared that all acts, conditions and things required by the Constitution and laws of the State of Georgia to be done precedent to or as a condition to the issuance of this Note have been properly done, have happened and have been performed in the manner required by the Constitution and laws of the State of Georgia; that the tax levies in anticipation of which this Note is issued are or will be valid and legal levies; that the City will use a sufficient amount of the proceeds of such tax levies and other available funds for the payment of this Note and the interest hereon; and that this Note, together with all other indebtedness of the City, is within every debt or other limit provided by the Constitution and laws of the State of Georgia. All capitalized terms used but not defined herein shall have the meanings assigned to them in the Resolution. IN WITNESS WHEREOF, the City acting by and through its Governing Body, has caused this Note to be executed in its corporate name by the manual signature of the Mayor, and attested by the manual signature of the Clerk and the corporate seal of the City to be impressed or imprinted hereon, all as of the date of original issue as shown above. CITY OF MILTON, GEORGIA By: (SEAL) Mayor Attest: Clerk D 2 CERTIFICATE OF AUTHENTICATION This is the Note described in the within mentioned authorizing resolution of Mayor and Council of the City of Milton, Georgia adopted on January 10, 2008, and is hereby authenticated. Date of Authentication: January , 2008 CITY CLERK OF THE CITY OF MILTON, GEORGIA 1 Sol-" (FORM OF ASSIGNMENT) FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto (Name and Address of Transferee) The within Note and does hereby irrevocably constitute and appoint attorney to transfer the within Note on the books kept for registration thereof, with full power of substitution in the premises. Dated: 1 Signature Guaranteed (Authorized Officer) (Bank, Trust Company or Firm) Notice: The signature to the assignment must correspond with the name of the registered holder as it appears upon the face of the within Note in every particular, without alteration or enlargement or any change whatever. 1 -03 01:20pn FrwYACHOVIA BANK GOVT W-,kf ,,HONti EAS. January 9, 2008 Stacey Inglis, Finance Manager City of Milton 13000 Deerfield Parkway Suite 1070 Milton, GA 30004 RE: Bid for TAN EXHIBIT "B" FORM OF WINNING BID 4048277123 T -r82 P.02/03 F-870 Dear Stacey: Wachovia Bank is pleased to provide a proposal for the purchase of the City of Milton's $5,450,000 Tax Anticipation Note ("TAN") as follows: Amount: $5,450,000 Structure: The full amount of the TAN will be funded at closing and any unused amounts will be placed into Wachovia's Government Advantage Interest Checking Account. Government Advantage offers complete liquidity, allowing you to easily draw funds whenever necessary. Maturity: 12/31/2008 Repayment: Principal and interest due at Maturity with no prepayment allowed. Interest Rate on Note: Indicative fixed rate of 156%. This rate assumes the TAN is bank - qualified, tax-exempt, and assumes a rate basis of 30/360. This rate is an indication only based on today's market conditions. The interest rate will change with the general level of market interest rates until such time that a rate is locked in. Forward Interest Rate Commitment: The Bank, unless it is instructed otherwise, will lock in a fixed rate at the timc the City accepts a financing commitment from the Bank. The lock -in rate will be guaranteed to the City through the dates of closing and will hedge against any unfavorable movement in interest rates between the lock -in date and the closing date. a" Page 1 of 1 Inglis, Stacey From: sallie.kerr@wachovia.com Sent: Thursday, January 10, 2008 10;25 AM To: Inglis, Stacey Cc: mike.wilson@wachovia.com; jeremy.peffer@wachovia.com; neeta.sheth2@wachovia.com Subject: TAN interest rate and bank account Stacey, As you know, banks provide indicative interest rates on TAN bids. Once the business is awarded, we lock in the rate. From the time we quoted the rate to you yesterday to today when we went to lock in the rate, rates have increased 2 basis points. The rate we have locked in for Milton's TAN is 2.58%. We talked to Han Choi and the closing is set for January 17th, 2008. Our proposal indicates we will fund the TAN proceeds into a Wachovia bank account. Han indicated that we may need to set the interest rate on the bank account at a certain level in order for Milton to avoid arbitrage issues. We will keep you posted as we learn more. My assistant Neeta will be emailing you the documentation required in order to open the bank account. The only other question I have is how the City intends to use the bank account. If there will be 6 withdrawals or less in a month, we would open a money market account. If you think there will be more frequent withdrawals, then we will need to open a checking account. Do you know how frequently funds will be withdrawn? Thanks again. If you have any more questions, please give me a call. Sallie Kerr Senior Vice President errw Government & Institutional Banking 360 Interstate North Parkway Suite 500; GA4607 Atlanta, GA 30339-2216 Telephone: 678-589-4304 Fax: 678-589-4315 1/10/2008