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HomeMy WebLinkAboutORD 2-Sr ,nw 0Titi .7 AN ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF.BEAUMONT, TEXAS, WATERWORKS IMPROVEMENT AND EXTENSION REVENUE BONDS, SERIES 19+7, IN THE AMOUNT OF TWO MILLION DOLLARS (2,000)000)2 TO BE DATED SEPTEMBER 1, 1947) TO MATURE SERIALLY AS HEREIN SET FORTH AND BEARING INTEREST AT THE RATES HEREIN SET FORTH, TO SECURE FUNDS FOR THE PURPOSE OF CONSTRUCTING IMPROVEMENTS, ENLARGEMENTS, EXTENSIONS, AND REPAIRS TO THE CITY'S WATERWORKS SYSTEM; PRESCRIBING THE FORM OF BOND; PLEDGING THE REVENUES OF THE WATERWORKS SYSTEM OF THE CITY OF BEAUMONT TO THE PAYMENT OF THE PRINCIPAL AND INTEREST OF SAID BONDS; PROVIDING FOR THE EXPENSE OF OPERATING SAID SYSTEM; MAKING CERTAIN COVENANTS OF THE CITY OF BEAUMONT IN REFERENCE TO THE BONDS AND THE BOND FUND FROM WHICH SAID PRINCIPAL AND INTEREST ARE TO BE PAID; PROVIDING THAT THE HOLDER OR HOLDERS OF SAID BONDS SHALL NEVER HAVE THE RIGHT TO DEMAND PAYMENT OF SAID OBLIGATIONS OUT OF FUNDS RAISED OR TO BE RAISED BY TAXATION; REPEALING ALL ORDINANCES IN CONFLICT HEREWITH; AND DECLARING AN EMERGENCY. WHEREAS, on the 3rd day of June, 1947, the City Commission of the City of Beaumont, Texas, passed an ordinance calling an election to be held in the City of Beaumont, Texas, on June 21, 1947, at which election there was submitted to the qualified electors of said City, who own taxable property in said City and who have duly rendered the same for taxation, among others, the following -pro- position: SHALL the City Commission of the City of Beaumont, Texas, be authorized to issue serial bonds of said City, being revenue bonds, in the amount of 2,000,000, for the purpose of construct- ing improvements, enlargements, extensions and repairs to the City's waterworks system, said bonds maturing serially in such installments as may be fixed by,the City Commission over a period of years, not to exceed thirty (30) years from their date, bear- ing interest at a rate not to exceed four per cent (4%) per annum, to be issued in accordance with and secured in the manner provided in Articles 2.111 to 1118, both inclusive, of the Revised Civil Statutes of Texas, 1925, as amended, each bond to be conditioned that the holder thereof shall never have the right to demand payment of said obligation out of funds raised or to be raised by taxation, secured by an exclusive first lien on and pledge of the revenues and income of the City's waterworks system after deduction of reason- able operation and maintenance expenses. In the event said waterworks revenue bonds are authorized, no such obligation of such waterworks system shall ever be a debt of the City of Beaumont, but solely a charge upon the revenues and in- come of the waterworks system, and shall never be reckoned in de- termining the power of the City of Beaumont to issue any bonds for any purpose authorized by law; and said bonds shall each have printed thereon the following: "The holder hereof shall never have the right to demand payment of this obligation out of any funds raised or to be raised by taxation"; and, WHEREAS, at said election held in the City of Beaumont on the 21st day of June, 1947, pursuant to said ordinance calling the same, and pursuant to notice thereof duly given as provided by law, a majority of the qualified electors residing within the City of Beaumont, who own taxable property in said City and who have duly rendered the same for taxation, voting at said election voted in favor of the proposition as above stated to issue the bonds therein described by the following vote: and; FOR THE ISSUANCE OF THE WATERWORKS REVENUE BONDS AND THE PLEDGING OF TBE REVENUES OF THE CITY'S WATERWORKS SYSTEM TO THE PAYMENT THEREOF - - - - - - - - - - - - - - - -- 2356 votes AGAINST THE ISSUANCE OF THE WATERWORKS REVENUE BONDS AND THE PLEDGING OF THE REVENUES OF THE CITY'S WATER- WORKS SYSTEM TO THE PAYMENT THEREOF - - - - - - - - - - 264 votes MAJORITY FOR THE ISSUANCE OF SAID BONDS - - - - - - - - 2092 votes WHEREAS, the City of Beaumont has authority generally to pass this ordin- ance authorizing the issuance of revenue bonds for the purpose of constructing improvements, enlargements, extensions, and repairs to the City's waterworks system under the Constitution and statutes of.the State of Texas, including particularly Articles 1111 to 1118, Revised Civil Statutes of Texas, 1925, as amended, and Chapter 163, Acts of the Regular Session of the 42na Legislature of Texas, as amended, and Section 11, Paragraph 2, of the Charter of the City of Beaumont; and, WHEREAS, the City Commission of the City of Beaumont now finds and determines that it is necessary and proper at this time to issue said revenue bonds; now, therefore: BE IT ORDAINED BY THE CITY CONMISSION OF THE CITY OF BEAUMONT, TEXAS: Section 1 That to provide funds for the purpose of constructing improvements, enlarge- ments, extensions and repairs to the City's waterworks system under the Consti- tution and statutes of the State of Texas, including particularly Articles 1111 to 1118, both inclusive, Revised Civil Statutes of Texas, 1925, as amended, and Chapter 163, Acts of the Regular Session. of the 42nd Legislature of Texas, as amended, and Section 11, Paragraph 2, of the Charter of the City of Beaumont, as well as all other laws of the State of Texas thereunto enabling, the City of Beaumont shall issue CITY OF BEAUMONT, TEXAS, WATERWORKS IMPROVEMENT AND EXTEN- SION REVENUE BONDS, SERICE 1947, aggregating two million dollars ($2,000,000), numbered from 1 to 2000, both inclusive, of the denomination of one thousand dollars (1,000) each. - 2 - Section_ 2 Said bonds shall be dated September 1, 1947, and shall bear interest at the rates as follows: Bonds numbered 1 to 1,2 L.S" both inclusive, at Z % per annum; Bonds numbered /ALZ to.1_ Coo both inclusive, at 2y� per annum; which interest shall be payable on March 1, 1948, and thereafter semi-annually on September 1 and March 1, of each year. Section 3 That said bonds shall become due and payable serially in their numerical order as follows: Rn-nA Mimlia-r 1 to 115, inc. 116 to 233, inc. 234 to 353, inc. 354 to 476, inc. 477 to 601, inc. 602 to 729, inc. 730 to 859, inc. 860 to 992, inc. 993 to 1127, ' inc . 1128 -to 1265, inc. 1266 to 1406, inc. 1407 to 1550, inc. 1551 -to 1697, inc. 1698 to 1847, inc. 1848 to 2000, inc. Maturity Date Amount September 1,.1948 $115,000 September 1, 1949 118,000 September 1, 1950 120,000 September 1, 1951 123,000 September 1, 1952 125,000 September 1, 1953 128,000 September 1, 1954 130,000 September 1, 1955 133,000 September 11 1956 135,000 September 1, 1957 138,000 September 1, 1958 141,000 September 1, 1959 144,000 September 1, 1960 147,000 September 1, 1961 150,000 September 1, 1962 153,000 The City of Beaumont expressly reserves the right to redeem any one or all of the bonds numbered 1266 to 2000, inclusive, prior to maturity on September 1, 1957, and on any interest payment date thereafter, provided notice of such redemption is published in a financial publication in the City of New York, New York, at least once not less than thirty (30) days before the time fixed for prior payment, and thirty (30) days' notice in writing is given to the place of payment before the time so fixed for prior redemption, and the money for their redemption or payment, including interest then due, shall have been deposited with the paying agent within ten (10) days prior to or on the date required for payment. If upon the happening of the above condition said bonds are not presented for payment they shall not thereafter bear interest. Unless on or prior to the redemption date the City shall pay or cause to be paid to the paying agent the principal amount of bonds to be redeemed, together with interest thereon to date of redemption, such redemption shall fail, and said bonds shall continue to be in full force and effect the same as if such redemption proceedings were never started and interest on said bonds shall - 3 - continue to run until maturity and payment or subsequent redemption, as pro- vided herein. Section 4 That the principal and interest on said series of bonds shall be payable upon presentation and surrender of the bond or proper coupon to The First National Bank of Beaumont Beaumont Texas or at T/f N�� ®�Yh� ! j/ 6 H/YN ®;= /YEW y"ok , /YEN/ r'0(C'k Orr e`d7JCs�r�i��1T/�.Ve�L Section 5 That each of said bonds shall be signed by the Mayor and countersigned by the City Clerk of the City of Beaumont, and the corporate seal of the City of Beaumont, Texas, shall be impressed upon each of them. Section 6 That the facsimile signatures of the Mayor and City Clerk may be printed or lithographed on said bonds, and said facsimile signatures shall have the same effect as if they had been executed manually by said officials. Section 7 That said bonds shall constitute special obligations of the City of Beaumont, Texas, and each of said bonds shall contain the provision that the holder thereof shall never have the right to demand payment of said obligation out of any funds raised or to be raised by taxation. Section 8 That said bonds and coupons to be attached thereto, and the State Comptroller's certificate of registration to be endorsed thereon, are to be in the following forms, respectively, with appropriate omissions, insertions, and variations, permitted or otherwise, as herein provided: NO. 1 $1,000.00 UNITED STATES OF AMERICA - STATE OF TEXAS COUNTY OF JEFFERSON CITY OF BEAUMONT WATERWORKS IMPROVEMENT AND EXTENSION REVENUE BOND SERIES 1947 KNOW ALL MEN BY THESE PRESENTS: That the City of Beaumont, of Jefferson County, Texas, for value received, acknowledges itself indebted to and hereby promises to pay to bearer ONE THOUSAND DOLLARS ($1,000.00) on the let day of September, 1948, with interest thereon from date hereof until paid at the rate of TWO per cent ( Z %) per annum, interest payable on March 1, 1948, and - 4 - rrrl ' w interest rate, and option of redemption before maturity, issued for the purpose of providing funds for constructing improvements, enlargements, extensions and repairs to the City's waterworks system udder and in strict conformity with Article 11, Section 5, of the Constitution of the State of Texas, Articles 1111 to 1118, in- clusive, Revised Civil Statutes of Texas, and Chapter 163, Acts of the Regular Ses- sion of the 42nd Legislature of Texas, as amended, and.Section 11, Paragraph 2, of the Charter of the City of Beaumont, and all laws thereunto enabling; and issued pursuant to an ordinance duly and legally adopted by the City Commission of the City of Beaumont on the 26th day of August, 1947, which ordinance provides for the opera- tion and maintenance of the waterworks system and for setting aside from the net re- venues of the City's waterworks system a sum sufficient for the payment of the prin- cipal of and interest on said bonds when due. It is hereby certified and recited that the issuance of this bond and the' series of which it is a part is duly authorized by law and by a majority vote of the resident qualified electors of the City of Beaumont, Texas, who own taxable property in said City and who have duly rendered-' the same for taxation, voting at an election held for the purpose within said City on the 21st day of June, 1947; and that all acts,, conditions, and things required to exist precedent to and in the issuance of this bond to render the same lawful and valid have been properly done, have happened and been performed in regular and due time, form, and manner, as required by the Constitution and laws of the State of Texas and the ordinance hereinabove mentioned, and that this series of revenue bonds does not exceed any constitutional or statutory limitation, and that provision has been made for the payment of principal and interest of this bond, and the series of which iV is a part, by irrevocably pledging to the payment thereof the revenues and income of the City's waterworks system after deduction of reasonable operation and maintenance expenses. The date of this bond, in conformity with the ordinance above mentioned, is the 1st day of September, 1947. In testimony whereof, the City Commission of the City of Beaumont, Texas, has caused the corporate seal of the City of Beaumont, Texas, to be affixed hereto, and this bond has been signed by the Mayor and countersigned and attested by the City Clerk, and the interest coupons hereto attached to be executed by the facsimile signatures of the Mayor and the City Clerk as of the 18t day of September, 1947. Attest: City Clerk of the City of Beaumont, Texas Mayor of the City of Beaumont, Texas - 6 - -L- •asI Sq -paas'.sTsaa uaaq Sep 8Wq sPq puoq pTes pue `aures Suzzzaougne eoueuTpao aqf. Sq quaurSPd s!.T oQ. paBpaTd sanuaaaa ag,. moa,T aTgeSed `suxas `quomneag jo Sq.TO aqa. jo uoT,4.eOTTgo TeToads SuTPuTq pTSe pTTPn e ST q -T a.'euq- pre `sexas jo area -S auq- jo sa'aT pue uoT4n4TfpuoO au4 u4Tx .94p zo,Tuoo uT pansei uaaq ser !�T q.sq!. sPuTJ au Pus `MPT Sq poaTnbaa se `uq-q Sq pau;Ruexa uaaq ser puoq srq, �eu� .passo arc- o� sexas Jo afe9,S aq'. ,To TPaauaO Sauao�.W 9114Jo agevT,T . 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OuTaeaq `L+f6T SdIaIIS `SCiOS MnnMM XOISXHJXE m lxmq .AOUCINI GX9OM=Vbl `s= `iaown vau d0 7zIO auq- uo Sep aup �.saaa�. -UT , Sqq-UOM xTs 2uTaq urns -PT-es `eoTaaurV 30 sageq.S paq.Tun aq,. ,To Sauoru TnjAeT UT ( ) jo tuns aqz S-vX9-j— 'Al oLS 0 o ff "/u ®1 sn 0# O *ly -7 e7 .LY W & "N Y e/( M 9AI r)/ Yap/ M 17N f & .YAt6fg 7k� VVIJNOV 9#j_ Te -10`ePxas `TuoTunPag `quoumeag ,To xueg TeuoTqeM IsaTd ails q.e aaaeaq oq. Sed TTTM ST uodnoo sTu,4 goTgx o!. puoq aq,:� uT paTaToads s anuaaaa ,To !.no `spxas `, .uoumeag jo SQ -TO agq- `916T `goa-ew ao SPp qsT aqq. u0 .oM :sMoTToa sP STT,eT-q.ue,sgns aq TTPus spuoq pTes og suodnoo q-seaaquT Jo slaOJ auy •(aATsnTv -uT `SgFT oq T paaaqumu spuoq uuoa,T paq-q-Tmo aq pTuogs gdPaSPaPd sTgs)* ��, Witness my hand and seal of office at Austin, Texas, this day of .1 A. D. 1947. (Seal) Comptroller of Public ,Accounts of the State of Texas Section 9 After said bonds have been executed by the City officials, as hereinabove provided, they shall be presented to the Attorney General of the State of Texas for examination and approval. After the bonds have been approved by the - Attorney General they shall be registered by the Comptroller of Public Accounts of the State of Texas. Section 10 The said waterworks system as improved and extended, together with all extensions, additions, replacements and improvements thereto hereafter con- structed or acquired, shall, for the purpose of this ordinance, constitute the "System,!. The term "Net Revenue" shall mean the gross revenues which shall include the revenue collections of every nature derived from the operation of the water- works system, minus the expense of operation and maintenance thereof, including all salaries, labor, materials, repairs, and extensions necessary to render ef- ficient service and every proper,item of expense; and where used in this ordinance the term "Operation and Maintenance" shall include all such items. The term "Bonds" as used herein shall mean the issue of revenue bonds authorized in this ordinance. Section 11 The City Commission hereby covenants and agrees that it will at all times while any of the bonds or any interest thereon are outstanding and unpaid charge and collect for servicOls rendered by said System rates sufficient to pay all maintenance, depreciation, replacement, betterment and interest charges, and to pay the interest and principal of the bonds as such interest and principal mature, and any outstanding indebtedness against the System, as is required by Article 1113, Revised Civil Statutes of Texas, as amended. For the benefit of the original purchaser, and for the benefit of any and all subsequent holders of said bonds, coupons, or any part thereof, and in addition to all other pro- visions and covenants in the laws of the State and in this ordinance, it is expressly covenanted: �,i/ �/fit /� ,r•'t 4: . A. RATES: The City shall fix and maintain rates and collect charges for the facilities and services afforded by the System, which will provide revenues sufficient at all times: (1) To pay for all operating, maintenance, depreciation, re- placement and betterment charges of the System, as required under Article 1113, Revised Civil Statutes of Texas, as amended; (2) To establish and maintain the Bond Fund hereinafter defined; and (3) To pay all outstanding indebtedness against the System other than the bonds, as and when same become due. The City Commission of the City of Beaumont shall from time to time pre- scribe by ordinance the rates to be charged for the water to be used by all consumers of its water system, and no free service shall ever be allowed, ex- cept for buildings and properties owned and operated by the City of Beaumont, including water used by the Fire Department. The expenses of operation and maintenance, including all salaries, labor, materials, repairs, and extensions shall be such only as are reasonable and necessary that the System may render efficient service, and the System shall be economically and efficiently operated and maintained. In case the rate established by the City Commission of the City of Beaumont is insufficient for any year to take care of the expenses of opera- tion and maintenance as hereinafter defined, and the interest and sinking fund necessary to retire all of said Waterworks Improvement and Extension Revenue Bonds as the same mature, as above required, or should the City fail in any of its obligations so that the funds required to be paid into the Bond Fund are insufficient, then the holder or holders of not less than $100,000 of the above referred to bonds shall have the right, either separately or jointly with others, for himself or by representation for all bondholders, to apply to a Federal or State Court in Jefferson County, Texas, having jurisdiction to compel the City to prescribe by ordinance a sufficient rate for such purpose and to fulfill such obligation; and said Court shall have the power to make any order by it deemed necessary to enforce the payment of these bonds out of the income of such Water System, as hereinabove required. Exclusive venue in all cases arising under this ordinance is laid in the Courts, Federal and State, in Jefferson County, Texas. Nothing in this Section or in this ordinance shall be taken to prevent the holder of any bond, the interest or principal of which has not been - 9 - paid on demand when due, from proceeding in any of such Courts either separately orjointly, as above stated, for the enforcement of the City's obligations. B. USE OF REVENUES: The City will deposit as collected all revenues derived from the operation of the System into a separate account (herein called the "System Fund"), which shall be kept separate and apart from all other funds of the City. The System Fund shall be administered as follows: (1) Maintenance and Operation Fund. There shall be set aside monthly in a separate account in the System Fund, to be known as the "Maintenance and Operation Fund", -such an amount as shall be found necessary to keep such fund at all times sufficient to pay the reasonable expenses of upkeep and mainten- ance of the System, and said fund shall be applied in payment of such expenses. (2) Bond Fund. From the funds remaining in the System Fund, after setting aside the aforesaid amount in the Maintenance and Operation Fund, the City shall pay into a separate account (herein called the "Bond Fund,,)', during each year beginning with the date of the bonds, an amount equal to one hundred per cent (100%) of the amount required to meet the interest and principal payments falling due on or before the next maturity date of the bonds. In addition to such payment, the City shall pay into the Bond Fund from the System Fund in each year twenty per cent (20%) of the above required amount until such time as there is in the Bond Fund an amount sufficient to meet the interest and principal payments on the bonds for one year in advance. The amount re- quired to be paid into the Bond Fund in each year shall be paid in substantial- ly equal monthly payments from the monies in the System Fund after making the required payment into the Maintenance and Operation Fund. If the revenues of the System in any month, after provision for operation and maintenance, are insufficient to make the required payment into the Bond Fund, then the amount of the deficiency shall be added to the amount otherwise required to be paid into the Bond Fund in the next month. It is the intent of this provision that the sums paid into the Bond Fund shall be in excess of the immediate requirements for payment of interest on and the principal of the bonds until there has been accumulated in the Bond Fund, as a reserve for contingencies (herein called the "Bond Reserve"), an amount sufficient to service the bonds for one year.. The monies in the Bond Fund shall be used solely for the purpose of paying interest on and principal of the bonds until all bonds have been retired; provided that when the total amount in the Bond Fund is equal to the aggregate principal amount of the bonds outstanding plus all unpaid coupons thereto appertaining, no further payments need be made into the Bond Fund, T and the monies in the Bond Fund may be used to purchase bonds at a price exclusive of accrued interest, not exceeding the principal amount thereof, provided that if such bonds are thus purchased at a price of more than their par value plus accrued interest, the excess of such cost shall be paid out of money other than that in the Bond Fund. The monies paid into the Bond Fund shall be deposited in a bank or banks and shall be continuously secured by a valid pledge of direct obligations of, or obligations unconditionally guaranteed by the United States of America, having a par value or market value when above par, exclusive of accrued interest, at all times at least equal to such Bond Reserve. The Bond Reserve at the option of the City may be invested in such direct obligations of'the United States of America and deposited in escrow under an escrow agreement. If such funds are so invested and deposited in escrow, the City shall have the right to have sold through the escrow agent on the open market a sufficient amount of said securities in order to meet its obligations of principal and interest in the event it does not have suf- ficient funds uninvested on hand for such purpose. Under such circumstances the Mayor is hereby authorized, ordered, and directed to give fifteen days' written notice to such escrow agent of the necessity to sell said securites on the open market. After such sale the monies resulting therefrom shall belong to the Bond Fund and shall be available to pay such obligation of principal aA interest. At any time there shall be money in the Bond Reserve ,Account sufficient to pay the principal and interest on said bonds scheduled to mature within the succeeding twelve months, such money in an amount not exceeding the require- ments of principal and interest for the succeeding twelve months may be used by the City for repairs and extensions, provided that only such repairs and extensions shall be authorized as in the judgment of the governing body of the City are necessary to keep the plant in operation and render adequate service to the City and the inhabitants thereof, or as might be necessary to meet such physical accident or condition which would otherwise impair the original securities. Under such circumstances the City shall obtain a certificate from a reputable engineer describing the use to be made of such money and an estimate of the cost of ,such repairs and extensions that are necessary to keep the plant in operation and render adequate service to the City and its in- habitants, and that such resolution shall be entered in the minutes of the City Commission of said City. In the event the Bond Reserve Account is depleted in instances as provided in the last preceding paragraph, it shall be the duty of the City to restore such monies by resuming the monthly deposit of funds in excess of actual re- quirements as hereinabove in phis section provided.. Each month while said bonds or interest thereon remain outstanding and unpaid there shall be transferred from the Bond Fund to the bank of payment or its legal successor not less.than one-sixth of the next maturing interest payment and not less than one -twelfth of the next maturing principal, which sums are to be used.in the payment of the principal and interest as they severally mature and as proper bonds or.coupons are presented for payment. (3) Surplus. Any money remaining in the System. Fund after provision for the reasonable cost of operating and maintaining the System and after paying the amounts required to be paid into the Bond Fund, as above provided, may be used by the City for the purchase of bonds at -not exceeding the market value thereof, or any other purposes permitted or authorized by law. C. REDEMPTION OF BONDS: With respect to the.redemption of any bonds under this ordinance, as well as to the payment of any of such bonds at maturity, such bonds shall be conclusively deemed to have been redeemed or paid for the purposes of this ordinance when the money for their redemption or payment, including interest then due, shall have been deposited with the paying agent within ten days prior to or on the date required. The paying agent shall hold such monies in trust for the redemption or payment of such bonds, interest on such bonds shall cease, and such bonds shall no longer be a charge against any other funds or any monies, revenues or income of the waterworks system. Unless on or prior to the redemption date the City shall pay or cause to be paid to the paying agent the principal amount of the bonds to be redeemed, together with interest thereon to the date of redemption, such redemption shall fail and said bonds shall continue to be in full force and effect the same as if such redemption proceedings had never started, and in- terest on said bonds shall continue to run until maturity and payment or sub- sequent redemption_ as provided herein. Nothing heroin shall prevent the issuance of bonds junior in lien to the present bonds. - 12 - D. MANAGEMENT AND CONTROL: The management and control of the waterworks system of the City of Beaumont shall be at all times in the City Commission of the City of Beaumont, Texas. Such City Commission shall have the power to make rules and regulations governing the furnishing of service to patrons and for the payment of same and providing for the discontinuance of such service in case of failure to pay therefor when due until payment is made. The City Commission shall have power to provide penalties for the violation of such rules and regulations and for the use of such service without the consent or knowledge of the authorities in charge thereof and to provide pen- alties for all interference, trespassing or injury to any such System or appliance or the premises upon which same may be located. E. INSURANCE: The City shall at all times.until the principal sum of .money and interest due on the Waterworks Improvement and Extensions Revenue Bonds shall have been fully paid, keep the various properties of the water- works plant and system which are usually kept insured by private water compan- ies, insured against loss or damage by fire or other injury, in good and res- ponsible insurance company or companies. In case of loss the insurance money received on any such policies of insurance shall be applied toward the re- building or replacing of the property destroyed or injured or the construction or acquisition of other property or facilities suitable to and needed as a part of such System, or when not needed for such purposes may be applied to the redemption of bonds. The premiums on insurance policies and all expenses necessarily incurred by the City of Beaumont in performing or fulfilling the covenants of this ordinance shall be an operating charge and shall not be charged against the General Fund of the City or against any fund to be raised by taxation. F. ACCOUNTS AND PERIODIC STATEMENTS: The City shall keep proper books of records and accounts (separate from all other records and accounts) in which complete and correct entries shall be made of all transactions relating to .the System. The City shall furnish to any holder thirty days after the close of each six monthst final period operating and income statements of the System in reasonable detail covering such six months' period, and not more than sixty days after the close of each fiscal year complete financial statements of the System in reasonable detail covering such fiscal year certified by the Cityts Mayor and City Clerk. -�3- G. INSPECTION: The holder or holders of the above-aescribea bonds shall have the right at all reasonable times to inspect the waterworks plant and the entire system and shall have the right to inspect the construction of the proposed extensions, improvements or betterments of said waterworks plant and system, and shall have the right to inspect all. xecoras, acoounts and data of the City of Beaumont pertaining thereto. The City will cause the books and accounts of such System to be audited annually by an independent firm of cer- tified public accountants and permit the inspection of the report of such accountants by the holder of any such bonds. Upon request and upon the pay- ment of the reasonable cost thereof, the -City will furnish a copy of such report to any bondholder. H. SALE OF BONDS: Upon request, the City will furnish to any purchaser of twenty-five per cent (25f) of the bonds information for the preparation of a bond circular in customary form, signed by the proper officials of the City containing such data as such purchaser may reasonably request concerning the City and the System. Section 12 The Mayor and City Clerk are hereby instructed and directed to do any and all things necessary or convenient in reference to the installip_g and maintaining of a complete system of records and accounts pertaining to said System and to make the monies available for the payment of the bonds in the manner provided by Chapter 122, Acts of the Regular Session of the 43rd Legislature of Texas, effective May 12, 1933. In accordance with the pro- visions of Article 1113, Revised Civil Statutes of 1925, as amended, the fiscal year for the operation of such System shall be January lst to December 31st, of each year. Section 13 The City hereby further covenants as follows: (a) That the revenue bonds authorized hereunder shall be special ob- ligations of the City and the holder thereof shall never have the right to demand payment thereof out of funds raised or to be raised by taxation. (b) That it has the lawful power to pledge the revenues supporting -this issue of bonds and has lawfully exercised said power under the Constitution and latts of the State of Texas, including power existing under Articles 1111 to 1118, both inclusive, Revised Civil Statutes of the State of Texas, with - 14 - amendments thereto, and Chapter 163, Acts of the Regular Session of the 42nd Legislature;. that the bonds Iissued hereunder shall be ratably secured under said pledge of income, in such manner that one bond shall have no preference over the other bonds of said issue. (c) In addition to monies to be paid into the Bond Fund from the revenues produced by said System, the City will pay into said fund the following: The balance remaining unexpended from the proceeds of the sale of the bonds after the completion of the improvements, and the money represented by in- terest accruing on said bonds from their date to the date of delivery to the purchaser or purchasers thereof. (d) The City covenants that other than for the payment of the bonds herein provided for, the rents, revenues and income of the said waterworks system have not in any manner been pledged to the payment of any debt or ob- ligation of the City or of said System, and that the waterworks system and all water rights appertaining thereto are owned in fee simple title by the City of Beaumont and are free and clear of encumbrances. (e) The City of Beaumont hereby irrevocably covenants, binds and obligates itself that neither said waterworks plant and system nor any part thereof, in- cluding any additions or extensions that may be made thereto, shall, so long as any of the bonds hereby secured or interest thereon remain outstanding or unpaid, be sold or disposed of, or be mortgaged or otherwise encumbered save by the issue of junior lien revenue bonds payable out of income and not se- cured by mortgage of the physical property. This section shall not, however, prevent the City from, in ordinary course of business, disposing of wornout or obsolete equipment, lines or other facilities deemed by it to be unnecessary or to be no longer fit and appropriate to the economical and prudent operation of the System, so long as by current maintenance and reasonable extension and betterment from time to time the ,System as a whole is maintained so that it may be efficiently and economically operated and serve well its purpose of supplying the City of Beaumont and its customers with water. The proceeds of any such sale shall be used to replace the items retired or be paid into the Bond Fund. Section 14 The Mayor of the City of Beaumont is hereby directed to submit the record of said bonds and the bonds themselves to the Attorney General of the State of Texas for approval, and thereafter to have them registered by the Comptroller - 15 - s of the State of Texas, and said bonds, when properly executed by the City officials, shall be held by the Mayor.of the City of Beaumont to be delivered by the Mayor to the purchaser or purchasers thereof. The Mayor and City Clerk are authorized and directed to do any and all things necessary and convenient to effect delivery thereof to the purchaser. Section 15 All ordinances and parts of ordinances and all resolutions and parts of resolutions incon#sistent with the provisions of this ordinance are hereby rescinded and repealed in so far as same may conflict herewith, and it is further provided that if any portion of .this ordinance shall be declared in- valid, such invalidity shall in noway affect the remaining valid portions thereof. Section 16 The fact that the present waterworks system of the City of Beaumont is in need of repairs and extensions, that the City of Beaumont has recently annexed a large additional area of terktory containing a large suburban population, and that many citizens of the.City of Beaumont are now without water services, and that such conditions endanger public safety by the increased fire hazards incident thereto and endanger the public health by reason of the insufficiency of water, create an imperative public emergency necessitating the suspension of the rule requiring ordinances to be read on three separate days before their passage, and said rule is hereby suspended and this ordinance shall take effect from and after the date of its passage. PASSED this, the 2l day of August, 1947, by the affirmative vote of all members of the City Commission of the City of Beaumont, Texas. Mayor of the City of Beaumont, Txxas — 16 —