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HomeMy WebLinkAboutReg 2006-04-17 Item 7 - Resolution - Cascade Water Alliance Bonds COUNCIL AGENDA SYNOPSIS Initials ITEM NO. 0i Ot 1 /4 G) Meeting Date Prepared by 1 Mayor's review ounci/ review 1 Aft? 1 04/17/06 PBB t 7808 1 1 1 1 1 1 1 1 ITEM ,INFORMATION CAS NUMBER: 06-044 I ORIGINAL AGENDA DATE. AGENDA ITEM TITLE Resolution authorizing and directing the Mayor or his designee to execute certifications, enter into a continuing disclosure undertaking, and do all things necessary to enable Cascade Water Alliance to issue and sell its initial bonds. CATEGORY Distwsston Motion Resolution Ordinance Bid Award Public Hearing Other Mtg Date Mtg Date Mtg Date 4/17/06 Mtg Date Mtg Date Mtg Date Mtg Date 1 SPONSOR Council Mayor Adm Svcs DCD Finance Fire Legal P&R Police PIS' SPONSOR'S Resolution authorizing and directing the Mayor to execute certifications, enter into a SUMMARY continuing disclosure undertaking, and do all things necessary to enable Cascade Water Alliance to issue and sell its initial bonds. Due to time restraints, Councilmember Haggerton has requested that this Resolution be placed directly on the Council Agenda. REVIEWED BY COW Mtg. CA &P Cmte F &S Cmte Transportation Cmte Utilities Cmte Arts Comm. Parks Comm. Planning Comm. DATE. RECOMMENDATIONS: SPONSOR /ADMIN Approve the Resolution as presented. COMMTI"IEE The Finance Committee will review the Resolution on April 17, 2006. COST IMPACT FUND SOURCE EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $0 $0 $0 Fund Source: Comments MTG. DATE 1 RECORD OF COUNCIL ACTION MTG. DATE I ATTACHMENTS 4/17/06 Information Memorandum to the Mayor from the Finance Director Proposed Resolution Draft closing certificates and agreements prepared by the law firm of Foster Pepper, Bond Counsel to the Cascade Water Alliance INFORMATION MEMO To: From: Date: Subject: Mayor Mullet I J/J ~ Finance Director ~ Apn112,2006 Cascade Water Alliance Interlocal Ae:reement ISSUE The City of Tukwila is one entity of the eight-member consortium known as the Cascade Water Alliance providing wholesale water to its current and future members in an environmentally safe and efficient manner. Through extensive planning efforts over the last several years, Cascade is now ready to take the next step into the future thr01Jgh a bond sale to provide the necessary infrastructure bringmg future supply to its member agencies. This bond sale requires formal authorizatIOn from each member, BACKGROUND The CIty ofTukwila has been operating under the new supply contract of the Cascade Water AllIance (CW A) since January of2004. Additionally, Cascade has completed an agreement with Tacoma for Second Supply Water from the Green River basin, Cascade now has a planning document with a CapItal Improvement program that includes a new supply pipeline slated to make Tacoma Second Supply water available to all its members, The Cascade Water Alliance bond issue will be closing in early May and has recently receive the AA3 rating from Moodys. Under the Cascade Interlocal Agreement, each member has agreed to provide (1) a continuing disclosure undertaking to Cascade that relates to certain SEC requirements, (2) "such other certificates or verifications as are reasonably requested...in connectIOn with the Issuance" of Cascade bonds. A formal resolution is needed from each ofthe members that will be merged into a single certIficate to be signed before the Cascade bonds are sold on April 26 and closed two weeks later. Also necessary is a closing letter from each member's attorney. Form of Motion: ACTION TAKEN: Authorize the Mayor or his designee to execute, in connection with the issuance of Cascade's 2006 bonds, a continuing disclosure undertaking, an approval of City operating and financial information in Cascade's official statement for those bonds, and such other certIficates or verifications as Cascade may reasonably request. RECOMMENDATION Forward to the Regular Council meeting. C"\water\cwa\INFO_CWA bond sale ~ ~-:>'f-""~::'~"!y-1,;'~, ..-,<5' .:5~....., ~'\ lot, 'Z-~ ~-J:@\, ; ,(;)", \~~.....! ~~""'''''~~) ~ City of Tukwila Washington Resolution No. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AUTHORIZING AND DIRECTING THE MAYOR OR HIS DESIGNEE TO EXECUTE CERTIFICATIONS, ENTER INTO A CONTINUING DISCLOSURE UNDERTAKING, AND DO ALL THINGS NECESSARY TO ENABL~ CASCADE WATER ALLIANCE TO ISSUE AND SELL ITS INITIAL BONDS. WHEREAS, the City of Tukwila (the "City") entered into an Interlocal Agreement effective June 1, 1999, as amended and restated as of February 28, 2005 (the "Interlocal Agreement"), relating to the creation of the Cascade Water Alliance ("Cascade"), and WHEREAS, pursuant to the Interlocal Agreement, Cascade is authorized to issue bonds for its purposes upon approval of the Cascade Board, and WHEREAS, the Cascade Board has determined to issue its initial bonds in a principal amount of approximately $58 million, to pay the costs of carrying out a portion of the capital program described in its Watershed Management Plan, and WHEREAS, pursuant to the Interlocal Agreement, debt service on the bonds will be paid directly from net revenue of Cascade and, indirectly, from member charges to be paid by the City and other members of Cascade; and WHEREAS, the Interlocal Agreement includes a "step up" provision, which provides that if any member fails to pay its share of member charges, the other members shall pay to Cascade (in addition to its own member charges otherwise due) the defaulting member's charges in proportion to each remaining member's share; and WHEREAS, the City now desires to recognize the issuance of bonds by Cascade and the City's responsibilities with respect thereto under the Interlocal Agreement, and to authorize and direct the Mayor or his designee to sign closing certificates and a continuing disclosure undertaking in connection with the bonds; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, DO RESOLVE AS FOLLOWS: Section 1. The City hereby acknowledges the issuance of approximately $58 million principal amount of bonds by Cascade, and acknowledges the City's responsibilities with respect thereto set forth in the Interlocal Agreement. The City authorizes and directs the Mayor or his designee to execute one or more certificates with respect to: A. Information regarding the City included in Appendix A to the Preliminary and Final Official Statements for the bonds; B. The absence of litigation with respect to the bonds and the City's obligations under the Interlocal Agreement; and C. The due authorization by the City of, and the validity of, the Interlocal Agreement. C:\Documents and SellingsWI Users\DesktoplKell}'\MSDATAlResolulions\Cascade Waler Alliance.doc PB:ksn 411312006 Page I of2 In addition, the City hereby authorizes and directs The Mayor or his designee to enter into an ongoing disclosure undertaking with respect to financial and operating data regarding the City included in the Official Statement. Section 2. The Mayor or his designee is authorized to take any actions and to execute documents as in his judgment may be necessary or desirable in order to carry out the terms of, and complete the Cascade bond issuance contemplated by, this Resolution. All acts taken pursuant to the authority of this Resolution, but prior to its effective date are hereby ratified, PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this day of , 2006 ATTEST/ AUTHENTICATED' Dennis Robertson, Council President Jane E, Cantu, CMC, City Clerk APPROVED AS TO FORM BY. Filed with the City Clerk: Passed by the City Council, Resolution Number: Office of the City Attorney C:\Documents and SettingslAlI UserslDesktoplKelly\MSDATAIRe.solutions\Cascade Water AJliance.doc PB:ksn 4/1412006 Page 2 of2 [Form of Member Certificate, to be dated the date of the Purchase Agreement] CERTIFICATE AND AGREEMENT OF THE [NAME OF MEMBER] The (the" "), a and a Member of the Cascade Water Alliance ("Cascade"), hereby certifies to Cascade and to Lehman Brothers Inc. (the "Underwriter") as follows (capitalized terms used below but not defined have the meanings assigned thereto in the Bond Purchase Agreement (the "Purchase Agreement") between the Underwriter and Cascade): 1. The is a duly organized under the laws of the State of Washington (the "State") and dulJ'i. authorized to own and to operate its water system as described in the Preliminary Official'Statement and in the Official Statement and to provide this Certificate and Agreement (the "Certificate") to Cascade and to the Underwriter. 2. The has full legal right, power and authority: (a) to execute and deliver this Certificate and to perform its obligations contained herein; (b) to execute and deliver the Closing Certificate and Agreement of the _ (the "Member Closing Certificate"); (c to enter into and to perform its obligations under the Amended and Restated Interlocal Contract, dated as of December 15, 2004 (the "Interlocal Contract" and together with this Certificate, the "Member Documents"), among Cascade and the members named therein (collectively, the "Members"); and (d to approve the Member Information defined below, the use by Cascade of the Member Information and the distribution by the Underwriter of Cascade's Preliminary Official Statement and Official Statement to potential purchasers of the Bonds. 3. Attached to this Certificate IS a true and correct copy of the [ordinance/resolution/motion] of authorizing the execution by of the Interlocal Contract; such [ordinance/resolution/motion] was [enacted/adopted/passed] at a meeting or meetings duly convened and held in all respects according to law; to the extent required by law, due and proper notice of such meeting was given; a quorum was present throughout such meeting; a legally sufficient number of votes were cast in the proper manner for the [enactment, adoption or passage] of such [ordinance/resolution/motion]; and such [ordinance/resolution/motion] is in full force and effect as of the date hereof and has not been amended, superseded or repealed. 4. The has duly authorized the execution and delivery by the of, and the performance by the of its obligations under, each of the Member Documents; each of the Member Documents has been duly authorized, executed and delivered by the ; and each of this Certificate and, assuming the due authorization, execution and delivery of the Interlocal Contract by the other parties thereto, the lnterlocal Contract, is a legal, valid and binding agreement of , enforceable in accordance with its terms, except as enforcement A-I may be limited by bankruptcy, insolvency, reorganization and similar laws affecting the enforcement of credItors' rights generally and by the application of equitable principles when equitable remedies are sought, 5. The has approved the information concerning contained in Appendix A and under the headings "THE MEMBERS- " and "MEMBER COVENANTS UNDER THE INTERLOCAL CONTRACT" in Cascade's Preliminary Official Statet:nent and in Cascade's Official Statement (collectively, the "Member Information"). 6. As of the date of the Preliminary Official Statement and as of the date of the Official Statement and this Certificate, the Member Information is true and correct and did not and does not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the staterhents therein, in the light of the circumstances under which they were made, not misleading. 7. Each of the representations and warranties of contained in the Member Documents is true and correct as of the date of this Certificate as if made on the date of this Certificate. 8. If, between the date of the Purchase Agreement and the date 25 days following the date of the Closing (a) any event shall occur or any pre-existing fact or condItion shall become known to that might or that would cause the Member Information, as then supplemented or amended, to contain any untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, shall promptly notify Cascade thereof; and (b) if, in the reasonable opinion of the Underwriter, such event, fact or condition requires the preparation and publication of a supplement or amendment to the Official Statement, at's expense will provide to Cascade a supplement or amendment to the Official Statement in a form and in a manner approved by the Underwriter. 9. The historical financial information of contained or incorporated in the Preliminary Official Statement and in the Official Statement fairly presents the financial position of the Member['s water system] as of the dates indicated and the results of its operations for the periods therein specified and are in conformity with generally accepted accounting principles applicable to applied on a consistent basis; and there has been no material adverse change in the financial condition or results of operations of ['s water system] or any development involving a prospective material adverse change in or affecting the financial position or results of operations of ['s water system] since the daters] thereof. 10. The execution and delivery by of this Certificate and of the Interlocal Contract, the performance by of its obligations hereunder and thereunder and the consummation of the transactions contemplated in the Member Documents and in the Official Statement to be consummated on or before the date of the Closing do not confhct with, result m a breach of or constitute a default under any of the terms or conditions of 's charter or of any resolution, ordinance, mortgage, deed of trust, lease or other agreement or instrument to A-2 which is a party or by which it or any of its property is bound, or any laws, judgments, decrees, rules or regulations applicable to of any court or other governmental body or any other applicable requirement of law; and no consent, approval, authorization, order, permit, registration or qualification of or with any such court or governmental agency or body was or IS required for the execution and delivery of, and the performance by any of its obligations under, either of the Member Documents or for the consummation by of the transactions contemplated in the Interlocal Contract or the Bond Resolution to be consummated at or prior to the date of the Closing. 11. There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body, pending against or, to the best of 's knowledge, threatened against (a) affecting the existence of members or officers to their respective offices, or or its governing body or the titles of its (b) contesting or affecting the powers of or its governing body with respect to, or the validity or enforceability of, or any authority for the execution and delivery of or the performance by _ of its obligations under, this Certificate or the lnterlocal Contract, or ( c) that might result in a material adverse change in the financial condition of ['s water system] or its ability to pay any of its obligations under the lnterlocal Contract, or (d) contesting the completeness or accuracy of the Member Information; nor, to the best knowledge of , is there any basis for any action, suit, proceeding, inquiry or investigation of the nature described in this Paragraph 11. 12. agrees to furnish such information, to execute such instruments and to take such other action in cooperation with the Underwriter and not inconsistent with law, as may be requested by the Underwriter to (a) qualify the Bonds for offer and sale under the blue sky or other securities laws and regulations of such states and other jurisdictions of the United States of America as may be designated by the Underwriter and (b) determine the eligibility of the Bonds for investment under the laws of such states and other jurisdictions and shall cooperate with the Underwriter to continue such qualifications in effect so long as required for the distribution of the Bonds; provided, however, that in each case shall not be required to execute a general consent to service of process or to qualify to do business in connection with any such qualificatIOn or determination in any jurisdiction. 13. is not in breach of or in default under the Interlocal Contract and to its knowledge, is not in material breach of or in material default under any loan agreement, note, bond, resolution, ordinance, agreement or other instrument to which is, or on the A-3 date of the Closing will be, a party or to which or any of its properties or assets is otherwise subject, and no event has occurred and is continuing that constitutes or that, with the passage of time or the giving of notice, or both, would constitute a material breach of or material default or event of default under any such resolution, ordinance, agreement, law, regulation or instrument. 14. In each year in which the Member Charges _ is required to pay is 10 percent or more _ of the sum of the Member Charges paid by all of the Members in such year, wIll provide to Cascade, not later than _ days after the end of such year, updated historical financial information and operating data of the type included as Member Information in Cascade's Official Statement, in the form required to enable Cascade to comply with its obligations contained in . Cascade's Disclosure Certificate. . confirms that it has never defaulted in the payment of principal of or interest on any of its debt obligations and that in the previous five years it has never failed to comply with any previous undertaking specified in Paragraph (b)(5) of the Rule. 15. agrees that any certificate signed by any officer of to the Underwriter shall be deemed to be a representation and warranty by Underwriter as to the statements made therein. and delivered to the 16. The officer of Certificate on behalf of signing this Certificate IS duly authorized to sign this 17. At the Closing, shall cause to be delivered to the Underwriter and to Cascade the opinion of counsel to and the Member Closing Certificate and the other documents and certificates required of the Member pursuant to Paragraph 7(e) of the Purchase Agreement. Dated this _ day of ,2006. [Name of Member] By' Title: A-4 Exhibit B [Form of Member Closing Certificate, to be dated the date of the Closing] CLOSING CERTIFICATE AND AGREEMENT OF THE [NAME OF MEMBER] The (the" "), a and a Member of the Cascade Water Alliance ("Cascade"), hereby certifies to Cascade and to Lehman Brothers Inc. (the "Underwriter") as follows. (capitalized terms used below but not defined have the meanings assigned thereto in the Bond Purchase Agreement (the "Purchase Agreement") between the Underwriter and Cascade): I. Each of the representations and warranties of contained in its Member Certificate is true and correct as of the date of this Closing Certificate as if made on the date of this Closing Certificate. 2. particular, Certificate. confirms its agreements contained in its Member Certificate, including in 's agreements contained in Paragraphs 8, 12 and 14 of the Member 3. The officer of signing this Closing Certificate is duly authorized to sign this Closing Certificate on behalf of the This _ day of , 2006. [Name of Member] By: Title: ERROR! UNKNOWN DOCUMENT PROPERTY NAME.