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HomeMy WebLinkAboutORD 88-65 0-88-65 AN ORDINANCE by the governing body of the City of Beaumont (the "Participant") authorizing the execution and delivery of a Supplement to its Lease Purchase Agreement with Houston-Galveston Equipment Finance Corporation dated as of August 1, 1986; levying a continuing direct annual ad valorem tax, within the limitations prescribed by law, for the payment of lease payments thereunder; and resolving other matters incident and related thereto. WHEREAS, the governing body of the Participant (the "Governing Body") has determined that it is necessary to provide for the use, acquisition and purchase of certain personal property on behalf of the Participant; and WHEREAS, in order to facilitate the use, acquisition, and purchase of personal property, at a cost that is advantageous to the Participant, the Governing Body has entered into a Lease Purchase Agreement with Houston- Galveston Equipment Finance Corporation, a corporation organized under the laws of Texas ("Lessor"), dated as of August 1, 1986 and restated and amended on October 21, 1986 (the "Lease Purchase Agreement"), to provide for the financing of such property and has approved the assignment of such Lease Purchase Agreement to a trustee (the "Trustee") under an Indenture of Trust between the Lessor and the Trustee dated as of August 1, 1986 (the "Indenture"), for owners of Certificates of Participation in the Lease Purchase Agreement (the "Certificates") and the bank providing a standby purchase commitment; and WHEREAS, Participant wishes to make a draw under the Lease Purchase Agreement and to do so is required to enter into a Lease Supplement approving the leas* of the equipment specified therein and the lease payments to be made thereon ehe "Lease Payments"), all in accordance with the Lease Purchase Agreement; and WHEREAS, the Participant wishes to enter into such Lease Supplement; BE IT RESOLVED BY THE GOVERNING BODY OF THE PARTICIPANT: SECTION 1: Findings: It is hereby found and determined that: (z) the Lease, including its form as a lease purchase obligation,- and the terms and conditions thereof, are hereby reapproved by this Governing Body; (b) all of the property to be acquired under the Lease Supplement is personal property, as defined under the Public Property Finance Act, art. 2368a.2, Vernon's Annotated Texas Civil Statutes (the "Act"), and during the term of the Lease is to remain personal property; (c) the contractual obligation of the Lease Supplement should be made payable from revenues, funds, and taxes available to the Participant for its public purposes, as permitted by Section 4(a) of the Act; (d) the property which is the subject of the Lease Supplement is required for the further maintenance of the Participant in the furtherance of its governmental purposes and but for the financing hereby undertaken would be 1 paid for out of revenues and funds legally available for those purposes (other than annual taxes levied for bonds), including taxes which have been and would be levied for maintenance purposes; (e) the Participant has available tax receipts and other revenues, in excess of amounts needed Jor maintenance purposes in the current year, to make the Lease Payments and a Z percent sinking fund in the current year. SECTION 2 Execution And Delivery of Lease Supplement (a) Each of the duly authorized officers of the Participant listed in paragraph-,, '(b) hereof are hereby authorized to execute and deliver the Lease Supplement (the "Supplement") substantially in the form attached hereto as tr +1= Su xh it Y. w =or�l�� :to I,qa§e .th, ,equipment specified_ in the Lease Supplement, all as authorized pursuant to"the Act. (b) The officers authorized to perform the duties described in paragraph (a) hereof are: Name Title (i) Albert E. Haines City Manager (ii) Betty Dunkerley Director of Finance SECTION 3: Levy of Taxes. To provide for the payment of. the Lease Payments under and as defined in the Lease Supplement, and a sinking fund of 2 percent if only the Interest Component of lease payments is due in any year, there is hereby levied, out of the maintenance tax heretofore approved by the qualified electors of the Participant, and there shall be annually assessed and collected in due time, form, and manner, a tax on all taxable property within the boundaries of the Participant, within the limitations prescribed by law, and such tax shall be and is hereby levied on each one hundred dollars' valuation of taxable property within the boundaries of the Participant at a rate from year to year as will be ample and sufficient to provide funds each year to pay the Lease Payments as the same become due during the term of the Lease, full allowance being made for delinquencies and costs of collection. Separate accounts and tax records relating to the receipt and disbursement of taxes levied, assessed and collected for and on account of the Lease shall be kept and maintained by the Participant at all times during the term of the Lease, and the taxes collected for the payment of the Lease Payments shall be deposited to the credit of a "Special 1986 Lease Account" maintained on the records of the Participant, and deposited in a special fund maintained at an official depository of the Participant's funds; and such tax, as a part of the maintenance tax, hereby levied, and to be assessed and collected annually, is hereby pledged to the payment of the Lease Payments. Proper officers of the Participant are hereby authorized and directed to cause to be transferred to the Trustee or paying agent for the Certificates appointed by the Lessor, from funds on deposit in the Special 1986 Lease Account, amounts sufficient to fully pay and discharge promptly the Lease Payments as the same become due and payable; such transfers of funds to be made in such manner as will cause collected funds to be deposited with the Trustee on or before each Lease Payment Date, as provided in the Lease Supplement. 2 The amount- of taxes to be provided annually for the payment of the Lease Payments_ with respect to the Base Rent (as defined in the Lease) including the principal component and interest component thereof ("Debt Service Requirements") shall be determined and accomplished in the following manner: (a) Prior to the date this Governing Body establishes the annual tax rate and passes "an ordinance levying ad valorem taxes each year, the Governing Body shall_determine: (1) The amount on deposit under the Trust Indenture to pay principal:..and ,interest,,components of the Certificates after (a) deducting therefrom`the-.4otal amount of Debt Service Requirements to become due as Base., Rent` prior to the.,;dO>re.;_annual_ ad valorem taxes levied by the Participant-`become del nquent ffie` "Collection Date") and (b) adding thereto the amount of the other revenue and funds appropriated and allocated to pay such Debt Service Requirements prior to the Collection Date for the ad valorem taxes to be levied. (2) The amount of other revenue and funds appropriated and to be set aside for the payment of the Debt Service Requirements between the Collection Date for the taxes then to be levied and the Collection Date for the Taxes to be levied during the next succeeding calendar year. (3) The amount of Debt Service Requirements to become due and payable between the -Collection Date for the taxes then to be levied and the Collection Date for the taxes to be levied during the next succeeding calendar year. - (b) The amount of taxes to be levied annually each year to pay the Debt Service Requirements shall be the amount established in paragraph (3) above less the sum total of the amounts established in paragraphs (1) and (2), after taking into consideration delinquencies and costs of collecting such annual taxes. With respect to the amount due as Additional Rent (as defined in the Lease), the amount budgeted for such purposes shall be the amount anticipated to become due during the Fiscal Year following, plus any amount of Lease Payments remaining unpaid from the previous year. The Participant covenants tiiat, . in accordance with the provisions of the Property Tax Code, Section 26.34(g), any amounts budgeted out of- the maintenance tax to pay the Lease Payments which are due more than one year from the date of the Lease will be set aside in the tax levy for the payment of such Lease Payments separate and apart from taxes levied for current maintenance and operating expenses. -SECTION 4: Pledge. The Participant hereby covenants and agrees that all the funds and revenues which are legally available for the purpose, with the exception of those in excess of the amounts required to be deposited to the Special 1986 Lease Account, are hereby irrevocably pledged to the payment of the Lease Payments, and the pledge of such funds and revenues herein made for the payment of the Lease Payments shall constitute a lien on such funds and revenues in accordance with the terms and provisions hereof and be valid and binding without any physical delivery thereof or further act by the Participant. 3 I e SECTION 5: Capitalized Terms. Capitalized terms not otherwise defined have the meanings ascribed to them in the Lease and Lease Supplement. SECTION 6: Lease Payment Terms. The Lease Supplement is hereby approved, and the Participant acknowledges (a) the method for determining the Interest Component of the Base Rent is approved, (b) an average interest rate not to .exceed [7.635%], used to derive the Interest Component of the Base Rate is- -approved, and-- (c) the Principal Component of the Base Rent (which may include an Allocable Share of Costs of Issuance) is approved. Either the Mayor, Mayor Pro Tem, or City Secretary is hereby authorized to approve and establish the interest, rate oa;`behatf� of,�this ,;City,_.Council at such time as such rate is available, but, in no -event. shall-. such rate exceed that specified in the preceding paragraph Evidence of such approval,and -_establishing of the rate by such officer of- the City Council shall be given by the signing of the "Payment Schedule" attached to the Lease Supplement, as the "Authorized Officer". SECTION 7: Equipment. The Participant hereby determines: (a) the Participant needs the Equipment to be Ieased under the Lease Supplement; (b) If applicable, all public notices required to be given by the Participant with respect to lease and purchase of the Equipment have been given; (c) the Equipment is available at a reasonable cost and, if applicable, acceptable bids for the sale and purchase of the Equipment have been received; and (d) the Governing Body approves the leasing and purchase of the Equipment and the execution and delivery of documents required in connection with the lease and purchase thereof. SECTION 8: Delivery of Supplement. The duly authorized officers of the Participant are hereby authorized to execute and deliver the Lease Supplement and other instruments and certificates as may be reasonably required in connection with the leasing of the Equipment and to consent to such changes in the terms of the Lease Supplement as may be reasonably necessary in connection with such delivery; execution and delivery of the Lease Supplement with any such changes by officers of 'the Participant shall constitute evidence of the approval by the Governing Body thereof.- _ SECTION 9: Open Meetine. It is hereby found and determined that advance notice of the time, place and purpose of the meeting was given to each member of the Governing Body; and that said meeting, and deliberation of the aforesaid public business, was open to the public, and written notice of said meeting, including the subject of the entitled order, was posted and given in advance thereof in compliance with the provisions of Article 6252-17, Section 3A, V.A.T.C.S. SECTION 10: Effective Date. This Resolution shall be in force and effect from and after its passage on the date shown below. 4 PASSED AND ADOPTED, this July 19, 1988. PARTICIPANT: The City of Beaumont By: Elected Official ATTE cted Official fici al (Seal) To Be Attached: Exhibit "A" -Lease Supplement p803dO36.exdbea 5