HomeMy WebLinkAboutResolution 56-1999 - Adopted .� L�,,.
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RESOLUTION 56-99
A RESOLUTION AUTHORIZING THE ISSUANCE OF UTILITY REVENUE
BONDS, SERIES 1999 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED
�10,000,000; PLEDGING THE GROSS REVENUES OF A PERSONAL
COn�IlVI[JIVICATIONS SYSTEM TO THE PAYMENT OF SAID BONDS; AUTHORIZING
OFFICERS OF THE CITY TO APPROVE, EXECUTE AND DELIVER CERTAIN
AGREEMENTS AND DOCUMENTS RELATING TO THE BONDS AND A JOINT
UNDERTAKING BY THE CITY AND THE CITY OF BERESFORD, SOUTH DAKOTA
BE IT RESOLVED by the City Commission of the City of Brookings, South Dakota, as
follows:
Section 1. Findin�s. It is hereby found, determined and declared that:
1.01. The City of Brookings, in the County of Brookings (the "City"), is a
political subdivision of the State of South Dakota and a body corporate and politic.
1.02. Under the laws of the State of South Dakota, the City is possessed of all
powers which are necessary, requisite or proper for the government and administration of its local
and municipal matters, and all rights and powers that now or hereafter may be granted to
municipalities by the laws of the State of South Dakota.
1.03. The City is authorized by South Dakota Codified Laws, Chapter 9-41, as
amended (the "Act") to acquire land and acquire and construct improvements and equipment
comprising a system for the purpose of providing a telephone system and related services.
1.04. It is proposed that, pursuant to the Act, the City undertake the acquisition,
construction and equipping of facilities (the "Facilities") which will comprise a Personal
Communications Service system in the Sioux City PCS Market (the "System"). Pursuant to
South Dakota Codified Laws, Chapter 1-24 and the inherent powers of the parties as Home Rule
cities, the City and the City of Beresford, South Dakota ("Beresford") propose to enter into a
Joint Powers Agreement (the ".Joint Powers Agreement"), copies of which have been distributed
to and reviewed by the Commission, whereby the parties will establish a Joint Fund (the "Joint
Fund") to own and operate the System. The Facilities will be contributed by the City to the Joint
Fund as the City's initial contribution to the Joint Fund, and the Facilities and the Joint Fund will
be managed by the City acting through the Brookings Municipal Utility ("BMU").
1.05. Pursuant to the Joint Powers Agreement, Beresford will agree to make an
initial cash contribution to the Joint Fund, which contribution will be deposited with the First
National Bank in Brookings, as escrow agent (the "Escrow Agent") pursuant to the terms of an
Escrow Agreement to be entered into by the City, acting through BMLJ, Beresford and the
Escrow Agent (the "Escrow Agreement") until certain conditions set forth therein and in the Joint
Powers Agreement have been satisfied.
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1.06. As authorized by the Act, the City has determined that it is necessary and
desirable to issue utility revenue bonds to be designated "City of Brookings, South Dakota, Utility
Revenue Bonds, Series 1999," in one or more series, in an aggregate principal amount now
estimated not to exceed the sum of$10,000,000, including an amount not to exceed the estimated
capitalized interest on the bonds during the construction of the Facilities, a debt service reserve
fund not exceeding 10% of the principal amount of the bonds and an allowance for underwriters
discount (not to exceed 2.0% of the principal amount of the bonds), original issue discount (not
exceeding 2.0% of the principal amount of the bonds), the premium for bond insurance, if any,
and other costs of issuance (the "Series 1999 Bonds"), the proceeds of which would be used,
together with any additional funds of the City which might be required (i) to finance the
acquisition, construction and equipping of the Facilities; (ii)to fund a reserve fund; (iii) to pay
costs of issuance of the Series 1999 Bonds and the premium for bond insurance, if any; and (iv) to
pay interest on the Series 1999 Bonds during construction of the Facilities. The Series 1999
Bonds will be issued pursuant to an Indenture of Trust (the "Indenture"), between the City and
the First National Bank in Brookings, in Brookings, South Dakota, as trustee (the "Trustee").
Section 2. Retention of Mana�in�Underwriter, Bond Counsel and Underwriter's
Counsel. The City hereby retains Dougherty Summit Securities LLC, in Sioux Falls, South
Dakota, as Managing Underwriter, Faegre & Benson LLP, Minneapolis, Minnesota, as
underwriters counsel and Dorsey& Whitney LLP, Minneapolis, Minnesota, as bond counsel with
respect to the Bonds.
Section 3. Authorization of Series 1999 Bonds.
3.01. The City hereby authorizes the Series 1999 Bonds in accordance with the
provisions of the Act, the Indenture and this Resolution. The Bonds shall be issued in a principal
amount specified in Section 1.06, or such lesser principal amount as the officers of the City
designated below, in consultation with the Managing Underwriter and bond counsel designated in
Section 2 shall determine to be necessary to accomplish the purposes set forth in Section 1.06; all
subject to the limitations of the laws of the State of South Dakota and of the Internal Revenue
Code of 1986, as amended (the "Code"). The Commission hereby approves the issuance and sale
of the Series 1999 Bonds.
3.02. The Series 1999 Bonds shall be issued in such form, mature at the time or
times and on such terms, consistent with this resolution, as shall be provided in the Indenture and
other agreements whose execution and delivery is authorized by Section 6 of this resolution.
3.03. The Bonds sha11 be special, limited obligations of the City, payable solely
from the Gross Revenues of the System and other moneys pledged therefor. The Bonds shall not
be payable from any general or other fund of the City, and the Bonds shall not constitute general
obligations of the City.
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Section 4. Pled�e of Gross Revenues of the S. s�tem. The Gross Revenues of the
System shall be pledged and appropriated to the payment of the Series 1999 Bonds as set forth in
the Indenture, including the supplements thereto and in a pledge agreement from BMU, on behalf
of the Joint Fund, to the Trustee. The Issuer reserves the right to issue additional obligations
payable from the gross revenues of the System upon the conditions set forth in the Indenture.
Section 5. Bond Purchase Contracts, Bond Terms Execution and Deliverv.
5.01. Sale and Bond Purchase Agreement. The Series 1999 Bonds authorized by
this Resolution shall be sold to the Managing Underwriters at a purchase price of not less than
98.00% of par, plus accrued interest and less any original issue discount (not exceeding 2% of
par), shall bear interest at a rate or rates per annum resulting in an average interest rate not
greater than 6.50% per annum and shall mature not later than 20 years from their date of issue.
The Mayor and Finance Officer are hereby authorized and directed to agree with the Managing
Underwriter upon the exact purchase price, principal amount, maturities, interest rate or rates and
redemption provisions for the Series 1999 Bonds, within the parameters set forth in this Section.
The execution of a Bond Purchase Agreement for the Series 1999 Bond, which sha11 set forth the
final terms of the Series 1999 Bonds, b the Ma or and Finance Officer is hereb a roved and
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authorized and such execution shall be conclusive evidence of such agreement and shall be binding
upon the Issuer. The provisions of the Bond Purchase Agreement as so executed, including all
E�ibits and Appendices thereto, are incorporated herein by reference. The Series 1999 Bonds
shall be issued pursuant to the Indenture.
5.02. Maturities. Interest Rates and Redemption Provisions. The Series 1999
Bonds shall mature on the dates and in the respective years and amounts, and sha11 bear interest
from date of original issue until paid or duly called for redemption at the respective annual rates
stated opposite such maturity years, and shall be redeemable on the dates and at the redemption
prices as shown on Exhibit A to the Bond Purchase Agreement pursuant to which the Series 1999
Bonds are sold to the Managing Undenvriter.
5.03. Dates and Interest Pavment Dates. The Series 1999 Bonds shall bear a
date of original issue as of the first or the fifteenth day of the month in which the Series 1999
Bonds are delivered to the Managing Underwriter. The interest on the Series 1999 Bonds shall be
payable on the dates shown on Exhibit A to the Bond Purchase Agreement.
Section 6. Authorization of Documents. In connection with the authorization,
issuance and delivery of the Series 1999 Bonds, the officers of the City designated by Section 7 of
this resolution shall enter into, execute and deliver the following indenture, agreements and
documents:
(a) the Indenture to provide for the issuance of the Series 1999 Bonds and setting forth
the terms thereof;
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(b) the Bond Purchase Agreement or similar agreement providing for sale of the Series
1999 Bonds;
(c) the Ofi'icial Statement or other document used for the offering of the initial series of
the Series 1999 Bonds;
(d) the Joint Powers Agreement setting forth the joint ownership and operating
arrangements with respect to the System;
(e) the Escrow Agreement with respect to the initial cash contribution to the Joint Fund;
(� the pledge agreement between the Joint Fund and the Trustee; and
(g) such other documents, agreements or instruments as may be necessary to make
covenants and recite facts required to demonstrate the validity and enforceability of the Series
1999 Bonds under the laws of the State of South Dakota and to assure the exclusion of the
interest thereon from the gross income of the owners of the Series 1999 Bonds under the Code
and to effectuate the terms and intent of this resolution.
I The execution and delivery of such indenture, agreements and documents is hereby authorized
and directed, the mdenture, agreements and documents to be in such form and to contam suc
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terms, consistent with this resolution, as the of�icers of the City designated herein shall determine
to be necessary and desirable.
Section 7. City Officers. The Mayor and Finance Of�icer ofthe City are hereby
authorized and directed to execute and deliver the indenture, agreements and documents
authorized by Section 6 hereof. Execution and delivery of such items by the Mayor and Finance
Officer sha11 constitute evidence that such items are consistent with the terms of this resolution
and have been duty authorized, executed and delivered by the City and are enforceable against the
City in accordance with their terms, subject to customary exceptions relating to bankruptcy,
reorganization, insolvency and other laws affecting creditors' rights. The Mayor, Finance Officer
and City Attorney are further authorized to take such other actions as may be required to
effectuate the terms and intent of this resolution. In the event of the absence or disability of the
Mayor or Finance Of�icer, such officers as, in the opinion of the City Attorney, are authorized to
act in their stead may take all actions and execute all documents approved hereby.
Section 8. Transcri�t Certification. The officers of the City are directed to furnish
to Bond Counsel and the Managing Underwriter certified copies of all proceedings and
information in their official records relevant to the authorization, sale, execution and issuance of
each series of Series 1999 Bonds, and such certificates and affidavits as to other matters
appearing in their official records or otherwise known to them as may be reasonably required to
evidence the validity and security of the Series 1999 Bonds, and all such certified copies,
certificates and affidavits, including any heretofore furnished, shall constitute representations and
recitals of the City as to the correctness of all facts stated therein and the completion of a11
proceedings stated therein to have been taken.
Section 9. Tax Matters and Continuing Disclosure
9.01. Certification. The Mayor and Finance Of�'icer being the officers of the City i
charged with the responsibility for issuing the Bonds pursuant to this Resolution, are authorized
and directed to execute and deliver to the Managing Underwriter a certificate in accordance with
the provisions of Section 148 of the Code and applicable Regulations stating the facts, estimates
and circumstances in e�stence on the date of issue and delivery of the Bonds which make it
reasonable to expect that the proceeds of the Bonds will not be used in a manner that would
cause the Bonds to be "arbitrage bonds" within the meaning of the Code and Regulations and
setting forth the City's covenants and expectations with respect to the application of Section
148(�(4) of the Code to the Bonds.
9.02. Restrictive Action. The City covenants and agrees with the registered
owners of the Bonds, that it will not take or pernut to be taken by any of its officers, employees
or agents any actions that would cause interest on the Bonds to become includable in gross
income of the recipient under the Code and applicable Regulations, and covenants to take any and
all actions within its powers to ensure that the interest will not become includable in gross income
of the recipient under the Code and the Regulations. The City covenants and agrees that, so long
as the Bonds are outstanding, the City shall not enter into any lease, management agreement, use
agreement or other contract with any nongovernmental entity relating to the Facilities which
would cause the Bonds to be considered "private activity bonds" or "private loan bonds" pursuant
to Section 141 of the Code.
9.03. Arbitrage Rebate. The City acknowledges that the Bonds are subject to
the rebate requirements of Section 148(fl of the Code. The City covenants and agrees to retain
such records, make such determinations, file such reports and documents and pay such amounts at
such times as are required under said Section 148(fl and applicable Regulations to preserve the
exclusion of interest on the Bonds from gross income for federal income tax purpose, unless the
Bonds quality for one of the exceptions from the rebate requirement under Section 148(� of the
Code and Sections 1.148-7 or 1.148-8 of the Regulations. In furtherance of the foregoing, the
Mayor and Finance Director are hereby authorized and directed to execute a Rebate Certificate, in
the form prescribed by Bond Counsel, and the City hereby covenants and agrees to observe and
perform the covenants and agreements contained therein, unless amended or terminated in
accordance with the provisions thereof.
9.04. ContinuinQ Disclosure. The City acknowledges that the Series 1999 Bonds
are subject to the continuing disclosure requirements of Rule 15c2-12 promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934 (17 C.F.R. §
240.15c2-12) (as in effect and interpreted from time to time, the "Rule"). The Rule governs the
obligations of certain underwriters to require that issuers of municipal obligations enter into
agreements for the benefit of the holders of the obligations to provide continuing disclosure with
respect to the obligations. To provide for the public availability of certain information relating to
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CERTIFICATE
The undersigned, being the duly qualified and acting Finance Officer of the City of
Brookings, South Dakota, hereby certifies that the above resolution is a true and correct copy of
the resolution as adopted by the City Commission on June 8, 1999.
WITNESS my hand officially as such Finance Officer and seal this 8`�day of June, 1999.
� eaoo�u Finance Officer
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the Series 1999 Bonds and the security therefor and to permit participating underwriters in the
primary offering of the Series 1999 Bonds to comply with the Rule, which will enhance the
marketability of the Series 1999 Bonds, the Mayor and the Finance Of�cer are hereby authorized
and directed to execute an Agreement Concerning Continuing Disclosure, by which the City
agrees to provide such information, either directly or through a disclosure agent, and the City
hereby covenants and agrees, to observe and perform the covenants and agreements contained
therein, unless amended or terminated in accordance with the provisions thereof, for the benefit of
the registered owners or beneficial owners from time to time of the Outstanding Series 1999
Bonds as therein provided.
� Section 10. Ratification. All actions heretofore taken by the City of any of its
officers in connection with the Joint Undertaking are hereby ratified and confirmed.
Section 11. Amendment. This resolution may be ame�ded at any time prior to
the issuance of the Series 1999 Bonds by adoption of an administrative resolution.
Adopted this 8th day of June, 1999.
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