03. Resolution 4329 - Refund 1986 Sewer Revenue BondsAgenda -April 28, 1997
AGENDA ITEM 3 - RESOLUTION -REFUND 1986 SEATER REVENUE BONDS
BACKGROUND/CONSIDERATION: To continue/complete the refunding
process for the bond, a resolution will need to be approved by the
Council. At this time, we do not have the resolution from the
bonding attorney.
97 04/28 17:36 %T4065430863 DORSEI & WHITNEY 6004/019
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RESOLUTION NO. `r 3 Z 9
RESOLUTION RELATING TO $925,000 SEWERAGE SYSTEM REVENUE
REFUNDING BONDS, SERIES 1997; AUTHORIZING THE ISSUANCE AND
FDCING THE TERMS AND CONDITIONS THEREOF
BE IT RESOLVED by the City Council of the City of Kalispell, Montana (the "City"), as
follows:
Section 1. Authoriz. nn and Recitals.
1.01. Authorization. The City pursuant to authority conferred by Montana Code
Annotated, Title 7, Chapter 7, Parts 44 and 45, as amended (the "Act"), and other laws of the State
of Montana, has established and presently owns and operates a municipal sewerage system (the
"System"). Under the provisions of the Act, the City is authorized to issue and sell its revenue
bonds payable during a term not exceeding forty years from their date of issue, to provide funds
for the reconstruction, improvement, betterment and extension of the System and to refund its
revenue bonds issued for such purpose; provided that the bonds and the interest thereon are to be
payable solely out of the net income and revenues to be derived from. rates, fees and charges for the
services, facilities and commodities furnished by the undertaking, and are not to create any
obligation for the payment of which taxes may be levied except to pay for services provided by the
System to the City.
1.02, Outstanding lion de. In accordance with the authorization described in Section 1 and
pursuant to Ordinance Nos. $59 and 1011 and Resolution Nos. 2861, 3649, 3984 and 4022, the
City issued and sold the following bonds which are currently outstanding: Sewerage System
Revenue Bonds, Series 1991, dated as originally issued as of April 15, 1991 (the "Series 1991
Bonds") and its Sewerage System Revenue Bonds, Series 1.991A, dated as of November 15, 1991
(the "Series 1991A Bonds"), currently outstanding in the aggregate principal amounts of
$2,450,000 and $3,346,000, respectively (collectively, exclusive of the Series 1997 Bonds, the
"Outstanding Bonds"), for the purpose of financing part of the costs of construction of
improvements to the System. No other bonds or indebtedness are outstanding that are payable
from revenues of the System other than the Sewerage System Revenue Bonds, Series 1986, dated
as originally issued as of June 1, 1986 (the "Series 1986 Bonds"). The Series 1986 Bonds are
outstanding in the aggregate principal amount of $955,000.
1,03. Sources of Funding; Refunding the Series 1986 Bonds. It is necessary and
desirable as hereinafter determined to refund the Series 1986 Bands from the proceeds of revenue
bonds hereinafter authorized in the approximate principal amount of $925,000. The debt service
savings to result from the refunding of the Series 1986 Bonds is presently estimated to
approximate $58,338.07, calculated on a present -value basis, and using a discount rate of
5.0368% over the term of the bonds herein authorized. As required by Montana Code Annotated,
Section 7-7-4502(1), the average annual interest rate on the bonds herein authorized is more than
three -eighths of one percent (0.375%) less than the average annual interest rate on the Series 1986
Bonds.
1..04. Parity Bonds. In Section 4.03 of Ordinance No. 859, the City reserved the right to
issue additional bonds payable from and secured by the net revenues of the System on a parity with
the Outstanding Bonds on certain terms and conditions. It is determined that the City is authorized
to issue a series of bonds (the "Series 1997 Bonds") in the aggregate principal amount of $925,000
to refund the Series 1986 Bonds, which bonds would be payable from and secured by the net
revenues of the System on a parity with the Outstanding Bonds.