Resolution 2686 - Sewer System ImprovementM
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synn! Ynns A17 ??CQVwQ W2 771 A=177m7may 07 TL.'�'
FaTys =77D T=77.� nnnanDs in) =700
MAY TE M, ETO�77' T�" �-7,7 7 �3:' �D
1=110, AND nwv-:�'c
T T I
�",,Y 122 VAT! 02 T-7 MY 17 0717ML, minn,;
to prescribe nnO colicat just and cqwlwbl� rates, Oofzus cad yc=12 Fcz c--
nqCMUS with On S>.'M and for W.Moon, TaWRIVen W dirwatly
o= v0rcctly furnIO.e therebyl to 1.suc Ka My's rev�=v bcnds in tho wL2r,-'
Eate principal nn.= of 0234,05 �o pay Lhc cost V suok LKarsok0j, j-d to
pl,13c and approyrote to Lhe y,yakno of ME boWs We not xevennas za he eorivw��
from the Opezation of the SCVVrWLe system §M�dlnz Arprevzoc"LO, KUNCrO2VL2 or
extonzinns thercof harOLUOT consMatcd nn PaqWW'e; that SUM rMan, nhnrju-�
nad rMo3o W13 he nuffWicn! jurial the oscfK 1M of snY Uprnvcmem nod
the term of the Venda Mrain LUMOVISOd W YVCI,'L�a�- �norc- �'�-""qwate
to pay the princi?al one WOr"at Wa on "Lch hands an& to cr�ate &nd Maintwon.
reasonable rasorvas WoMw as her,in prcoerkhoe; that Va City his approvsd�
plans DO ;:c2..aQ by its ea30cor for said Oa-L ro-',
thu purpose of payiaz costs 0: OwnsW"ctfor of the UMVLOYIns the City US, Pur-
sunnt to the authority harolsabova dascriboi, My sold its s4werage sysun,-:'.
revenue bonds in rho prizz!pal ammum of 01M,002, whoh o,wont is; gatimotow t,-,
be suffiWont to pLy Ow aMize ccat cf'sucl; unQrLwhinj; an! WL it j, wxyMent
thm the bones sboold Le issued Fornholth, on& to, M!" 0:�MN ho�s is apao%W"'
ratified W COAM=00''
2"
Tna rity who!! issou !ws no3otlabic coup,t-,
bonds to be desigsitod no SeuarLLo Synew Wvanuo nones "f 296% in the a2yre2w
prinCipal amount of 0134,000, Sall WrCs Oall bu 135 14 nolion one'
serkIly Kam 1 to 101, 1nMz1vv, each in th" dcnonionw,i of $1,000, Mll he
dated as of May 1, 462, Mll heqv Intereat at tva nt�nwl rate son forth below
OpynsiLw their respectivo mLwwrlty ycars and soris' no"hur,, paynhin neminanually
on My I W Novembor I of each nor, an6 shall movuru social!, an My 1 and,
November 3 in the years and amourm os Win=
tv r I in,
�" �o-r n S"v " 1 N 1 V', al r
-i 7?
511169 6,00C 7 - 12 1.057 511175 4,000 -Y - 70 1.25111�
11/1/69 6,000 13 - 19 4,157 1311176 4,OOC - so 4.101
51117o %ano 19 24 CHOI 5!1!77 4,000 - it 4.051�1
1111170 6,OOC 25 30 A.057 1111177 4,000 - Y
511/71 5,00 31 36 0.20 511172 4,000 &Q M
1111171 4,000 37 40 4.237 13!1/71 4,300 W Do 1,n57,
5/1172 A,OGO 41 M 4057 5!1/7q 4,000 07 Inn 4.25','',
11/1172 4,000 45 12 MY 101179 4,000 130 4.25`11�
511/73 4,0W 49 - 51 4.25% 5/1180 5,000 10 110 MY`
1111173 4,000 53 - 56 4.25% 1111180 0,000 131 116 4.50Y
511/74 4,000 57 - 60 4.85% 511/81 1,000 117 - 122 M01,
1111174 4,000 61 - 54 MA 11/1121 6,000 120 - M1 A""T'
5!7175 1,000 65 - 61 4.357 S11102 G,COC 129 - M
Q-
Ban�s maturing on " before May 1, 1973 shall be payable at their re=eaza.ve
Wood Maturity dw as without option of 1�'.ior payment, buz bonds havLgl statoo
mp ion
—i �ty dates on :x after November 1, 1973 sh��11 each be subject to rede, t
?repayment at t nrtion of the City on 1, 1973, and Lny inte.-es��, pay-
Lcno date thereafter, -t par plus interest to the date fixed Vor redemptW-,
Wroof, and in inverse order of their ser!,, r,,o-,�bers, provided '�'-,hat not less
= i thirty days b0fare the date specifieU for redemption of arW bond, notice of
vie vall thereoP sball be mailed by the City Treasurer, by registered mail, to
zhe older, if known, and to the initial purchaser of the bonds, and shall also
. � DuAlishad in oze issue of a nowsy,per of general -within the C-',ty.
wo Oty Treasurer is directed to zointain a record of the nwaes and addresse,,�
of vhc holders of propayable bonds of the Oame, so far c,�, such information is
mada available to him, for the purpose of . �107 such notices, The princival
w !2d interest an the bonds shall be py"Ke at the office of the City Treasurer
in Kalispell, Montana, in any coin or currency of the United States of America
wVch on the respective dates of payment is legal tender for public and privet,
Scction 3. Llorm of Bond-,.. The bonda herein authorized 06 the interes"
coupons appurteaant thereto shall be in substantially the following form:
M
QVIV.
VNITZ0 STATES 07 ANERICA
STATE OF MONTVA
COUNTY OF FLATVEWD
CITY OF WISP=
S�:',,7FRAGE SYSTT`,�' nnNr" OF 11)68
No I
11,000
YNOW AIT = BY WS11 PnES07S that the City OF TaliSP011o 0 Ouly
orlaajzed mumcipal corporation of Flatheno County, Wontana, For value reaelved.
bLreby �,proi-,ilses to pay to bearQV, solely out of Vw Revenoe Und Amount OC its
.Sewerage System Fund, the sum of ONE TnOUSAND DOLLARS an the Ist day of
19 , or if this bond is redeemable as stated below, on a date PrIOr thevmto
oa whjQ% it shall have been duly called For redemption., and to pay lnocresz
00yenn out of said account from the date here& until the principal sun in pvij�
or It this bond Is redeemable, until it has been duly called for redemption, W:
the rate of four and 013h.ty-five hundredths per cent (4.25%) per annum, payable
samlannually on the Ist day of May and the Ist day OC Qvcmher of each year,
invercst to maturity being represented by and payable In accordance with and
upon Presentation and SuTrQnder V the Intcrest coupons appurtemanz hercto. Both
principal anj interest arc payable at the ofEice of the City Treasurer, in
Kalispell, Montana, in any coln or 'currency of the United States of Am-rica which
on the respective sates of payment is legal tender for public and private 000S.
This bone Is one of an issue In the total principal amount Of 0134,00%
all of like date and tenor cwcopt as to serial number, maturity date and re-
demption privilege, 106u03 puj6uaat to by the raqw1sita maO ' ority
of the qualMed electors of the City votW3 on the question at an election duly
colind and %all, for the purpose of providin3 money to finance the improvemcnt of
its municipal sewera, system, and pursuaaL to and in full conformity wl;h We
Constitution and laws of the State of Montana and the ord0=05 of said City
thereonno enablina, including Title 11, Chapter 24 of the Rsvi6ad Codes of Mon-
tann 1947, as amended.
Bonds of tbis'Issve maturing on or before May 1, 1971 are payablc at
their respective stated maturity dates without option of prior paprent, lut bonds
having stated maturity dates on or aFter November 1, 197 orc each subject to
redemption and prepayment at the option or the City, at Por and accrued interest
and in inverse order of their serial nuvber6, on May 1, 1973, anj nny interest
paynant date thereafter. Not less than thirty days in advaacc OF His data fixed
For prepaymunt and redemption of any %ond, the City will mail notica of the call
thereof to the holder, if known, and to the original purchaser, ani will caow,�
such. notice to be published in a zeneral circulation in said City. foldors of
prepayable bonds of this issue may register their names ant addres,an and tbe
serial numbers of their bonds with the City Treasurer for the purpose of receiv-
W3 such mailed notice.
1T IS 77REBY CZRTTFTW� =TTED, C0V2-N!,%,TFr) AND ACUEED that the City has
duly authorized and will forthwith construct and complete the undertnkW3 above
mcntioned, has fixed and established and will collect reasonable rates and Chat-
3es for the services and facilities afforded by the municipal sewcraic system
and has created a special Seynra3e System Fund Wto which the gross revenues of
the system, including all additions thereto and rcplacemeats and Improvcmunts
thereof, will be paid, ant a separate and spoVal neveane Bond Account in that
fund, into which will be paid out of the net revenues of the system amounts
sufficient to pay all principal.of and interest on the bonds of ohis issua when
due, and sufficient to establish a reserve thcrefor as provided in said OrKnancc
in a sui equal to the maximum amount of principal and interc= to fall due witV
In any subsequent calendar year on all such bonds; that the Revenue Bond Account
will hc usci cnly to pay the principal of W laterost on bonds Wn payabla
therefrom , as such yzincipal aad interest rcs,ctivoly became duc; Vint sucln
rates and chw�3o5 will from tina to time be WL and kept sufficient to Provid,'
;ross inconc mil vevanzis ce,quata for prompt payncnt of the rcasonable =.]
ciarcrt expsnsa3 of operation aN maintenance of die sayQra, 513Lem Ind Os
�Wccc in each caleninr year out ravanues, in excess of such current expcnses'
cqual to zin maximum amannt cE principal an& inte7enn payahle from the Rcvunuo
C Accorit in any WyequenL calanOnr year: that tho p"yments requtrud to W,
11, to tKu Ruvooic Tend Account Constitute a first and prior llzn and char,
on �hn onLI-c not income nnd revenues to be derived Froa the operation of sue!
v>vzz ano of all futurc additions thereto and butterments tharcaQ, that ad-
&!Hanol rovcnue bonds payable as to both principal and interest from snid ne
nwvoovos an a parity with the bonds of this issue may be issued pursuant to K-
authority vecite6 abovc, upon certain conditions set forth In snid 0rWn6KcQsW
hnnin payable from the Revenue Bond Accouot way be refunded by the isnuanct Of
re'vnew2 haaQ psynAlc from the zame aeCounL, prov3dcd that SuCL YOWndi%;
bonin mature subscquent to the WsL maLurlty datc of bonds not so refunded, buL
no other rhilLation will be inctwred ind madQ pnyable from the nz! revenues of
thu invicipal AQwvrn;e system, whetbar or not such chligation shall Mo con-
sz,oun a jancrol ob1:LaWcn and, indobtedness of the City, unluns the lien
1!,j,S7 syn1l to CN;Xun�ly =see subcolinatc to tho lien cf Lha honda of WS.
.k mu sn i"h nct YovQnuco: that all provisions for the security of the WIN;
K 03 borZ scv forth in said Ordinance oil! he pune=31y and fnithfully par-
Cryvnj so thercin stipulvtod; thot all acts, curdWons and thinas requirS Q
Qc Constitution W laws of the Wato of Montana =d the cr&Kancew of the Cil,
to to emv, to exist, to hnppen and to be perfc=mcd in order to mnkQ this bond
a v"lij and b3ndw& special obliZatAn of the City accordlnZ to its Lerms havc.
Nun Cone, do cylst, havc happened nnd have been porformed as so ruquired; and
r%a� the Wwancc of thiu bond did , not caune the indebtedness, whether genwral
or s;ocin! of the City to excced any constitutio=3 or statwLory limitation.
T','\l �,TTNESC ',�"-,=EOF the City of Nalispcil, Flathead County, MonLana, by
0n City Cuimcil, has caused this boW to be executed in its behalf by the Mayor
counL,rsTZncd by Lhc City Treasurer, and attested by the City Clerk, and scalod
with its corporate seal, has caused the appuxtenant interest coupons to be
excccad and LuthenLicated by the facsimile signatures of'such officers, and has
cauW Ws bond to be dated as of May 1, 1903
QZAI �
City Clerl� Countersilned
Qcrw of Coupon)
Mayor
On the Ist day of May (November), 19 , the City of Kalinp0l, Flat-
hca? Cnun,y, Montana, will pay to War= at the ofEice of the City Trcasurer,in
TalKysil, Montana, cut of the special fund and account desQnatcd In Lhd boncl
owucribow !w1ow, the amount shown hercon in lawful money of the Unitod States of
Amcr:ca for Interest than due on its Sewerage System Revenue Bond of 1968,datc6
may 1, 1968, No.
(Tacsimile &Snaturc) (Facsimile signature) CFacsimlle slanature.
City CYC'', City Treasurer May=
(Con;mns n1mocred 11 and upvzr6s shall also contain the phrase:
"Unless the bond described below is called for earlier redemption".)
section 4. Execution of Bonds. The bonds shall be forthwith Prepared
for execution under t�_e -direction of the City Clerk, and when so prePared shall
be executed on behalf of the City by the Mayor, countersigned by the City Treas-
urer, and attested by the City Clerk; and shall be sealed with the official seal
of the City. The interest Coupon$ appurtenant thereto shall be executea z�;,-.d
authenticated by the printed, engraved or lithographed facsimile Signatures of
such officers after registering the bonds in the manner specified in Section
11-2318, Revised Codes of Montana 1947, the City Treasurer shall cause them to
be delivered to the Conrad National Bank of Kalispell, Montana, as purchasers
thereof, upon payment of the purchase price as specified in the contract of sale
heretofore made and executed, which contract is hereby approved, ratified and
confirzed, and the purchasers shall not be obligated to see to the application
of the purchase price.
section 5. Sewerage System Improvement Fund, The proceeds of the bonds,
with the exception of the accrued interest and premium, shall be credited and paid
into a special fund which is hereby created and shall be maintained by the City
Clerk and Treasurer upon the books of the City, separate from all of its other
funds, designated as the Sewerage System Improvement Fund, and shall be deposited
and secured as provided in Section 9 hereof. From this fund there shall be paid
as incurred all such items as constitute, in accordance with sound accountinG prac-
ticest proper costs of the Undertaking described in Section 1, as provided in the
Plans and specifications therefor; including, but without limitation, all engineer-
ing, inspection, fiscal and legal expenses, the cost of lands and easements, the
rejImbursement of any advances heretofore made by the City, and all other expenses
heretofore incurred and to be incurred in connection with the financing and con-
struction of such undertaking. All other moneys granted to or appropriated by the
City for the undertaking shall likewise be credited to this fund. The moneys in
the fund shall be used only for the purposes above set forth, except that if any
moneys shall remain after the completion Of the undertaking and after payment of
all costs thereof, such remaining moneys shall be transferred to the Sewerage
System Fund referred to below.
Section 6. Priority of Bond Pamentsi issuance of Additional Seweraiye
fyEtem Revenue Bonds.
6.01 Priotily of Bond P=.ents, "ach and all of the bonds herein authorized
shall be equally and ratably secured by and payable out of the net revenues of
the municipal sewerage system without preference or priority of any one bond over
any other by reason of Verial number, date of issue or otherwise; provided, that
if at any time the net revenues on hand in the Sewerage System Fund as defined in
Section 8 hereof are insufficient to pay principal and interest when due on all Such
bonds, any and all moneys then on hand shall be first used to pay the interest dl�e,
and the balance shall be applied. toward payment of the maturing principal of such
bonds in order of their maturities, the earliest maturing bonds to be paid first,
and pro rate, in payment of bonds maturing on the same date,
6.02 Issuance of Additional Sewerage System Revenue Bonds. Except as pro-
vided in Section 7 of this Ordinance, no additional bo secured by a pled�Se of
the revenues of the municipal sewerage system and payable therefrom as to princiT)al
and interest on a parity with the bonds herein authorized may be issued by the
City unless:
(1) The City is not in default of any of the provisions of this
Ordinance; and
(2) There is no deficiency in the Operation and Maintenance Account
.or the Revenue Bond Account established by this Ordinance; and
-5-
(3) The City provides in the resolution authorizing the issuance of
such bonds that the net revenues of the municipal sewerage system for each
calendar year following the issuance of such bonds mill be at least equal
to -maximum amount of principal and interest coming due in any subsequzat
ws!Qndar year on ouch additional bonds and the bonds herein authorized; and
The City obtains a certificate from an independent. licensed prp7
fesw�cwal engincer snating that in his rrofessional opinion the net revenuee
of a mmicipal sewerage system as defined in Section 8.03 hereof, in-
KnOng revenues to be derived from any inprovements or extensions to be
financed by the issuance of such additional bonds, to be received each
calendar year duxinZ the remaining term of any of the bonds herein author-
Owd, will be at least equal to the maximum amount of principal and in-
terest to come due doring any such year on the bonds herein authorized
and such additional bonds,
Section 7. issuance of Refundin�7 Revenue Bond,-, The City reserves the
Vzht and privilege of refunding any or all of the bonds herein authorized and r
Orred to, but only subjeQt to the following terms and conditions-
741 Pay matured bonds may be refunded if monyrs available for. zne payment
%hereof at maturity, within the limitation prescribed in Section 6 hereof, should
at any time be insufficient to make such paymenz in fall.
7�02 Any bonds may be refunded prior to maturity, as and when they become pre-
p�iyable Lccordlng to tneia� terms.
J.03 Provision may be made for the payment and refunding of airy bonds not yet
maturcd or redeemable by the deposit with a duly qualified depository baak2 as escray
agent, of a sufficient amount of cash, or of bonds or other general obligations of
the United States Government, to pay the principal amount of such outstandin6 bonds
with inzerest to the eaxliest subsequent date, if any, upon which the same may be
caLlwd for redemption and prepayment, and with interest to the maturity of any such
WON which arc not subsequently prepayable.
7.04 Any refunding revenue bonds issued for such purposes may be made payaW.
from the net revenues on a parity as to interest with all then outstanding bonds of
the isono herein authorized, provided that (1) the maturity of each refunding reve-
nue bond shall be subsequent to the last maturity of the then outstandin,weverwie
bonds of this issue which are not refunded or to be refunded out of moneys on de-
posit with an escrow agent as provided in Section 7.03, and (2) no bondholder shall
be required to accept a refunding revenue bond in exchange for any bond owned by
him.
Section 8. Sewerage System Fund.
8.01 Revenues ADnroDriated. So:jong as any of the principal of or interest
on any of the bonds of the issue herein authorized and referred to shall be out-
standing and unpaid, or until there shall have been set apart in the Revenue Bond
Account herein established a sum sufficient to pay when due, or to redeem prior to
usturity, the entire principal of such bonds remaining unpaid, togotLer with in-
terest accrued and to accrue thereon to maturity or to the earliest date upon which
they may be redeemed according to their terms, the City irrevocably covenants with.
the holders of each and all of such bonds that all of the gross revenues derived
from the operation of its sewerage system will be accounted for, applied and dis-
posed of in the zenaer provided in this section, and will be deposited and secured
as provided in Section 9 hereof. Suzh gross revenues are hereby defined to include
all income and receipts derived from rates, charges and rentals imposed for con-
nections with and for the use of such system, including all additions thyreto and
betterments and replacements thereof originally or sAbsequ.ently constructed or
2 v
436
acq-eired, or.for the benefits provided by the facilities of the system, or from sales
of property acquired in connection therewith, and all Denalties and interest on such
rates, charges ead rentals, but shall not include any special assessments levied
for the cons,truction, of sever mains or other in-provements. All gross revenUCS shall
be paid, as received by the City, into the municipal Sewerage System Fund, which
fund shall at all times be segregated and maintained by the City Clerk and Trea�urer
on the books of the City as a separate and special fund. This fund *hall be sub-
divided into the separate accounts described below, and the gross revenues received
in the fund shall be apportioned on the first day of each month, and shall be credit-
ed to such repective accounts and accounted for therein and expended therefrom as
follows;
8.02 Operating Account. There shall first be set aside and credited to the
Operating Account, as a first charge on the gross revenues, such amount as may be
requireds over and above the balance then held in that account, to pay the reasonable
and necessary operating expenses of the system which are then due and payable or
are to be paid within the following six months. The term "operating expenses" Shall
mean the current expenses, paid or accrued, of operation, maintenance and currQnt
repair of the sewerage system and its facilities, as calculated in accordance with
sound accourting practice, and shall include, without limitation, administrative
expenses of the City relating solely to the seweraee system, premiums for insurance
on the properties thereof, labor and the cost of materials and supplies used for
current operation and for maintenance, and charges for the accumulation of appro-
pri,ate reserves for current expenses which are not recurrent monthly but may reason-
ably be expected to be incu:Lred in accordance with sound accounting practices. Such
ex.nenses shall not include any allojance for depreciation or renewals or replace-
ments of capital assets of the system and shall not include any portion of the
alaries or wages paid to any officer or employee of the City, except such Portion
�s shall represent reasonable compensation for the performance of duties necessary
o the operation of the sewerage system. There shall also be credited,to this ac-
ount all additional sums collected until there has been accumulated therein an
)perating Reserve in the amount of $6,700.OQ which sum shall be maintained by ad-
litional transfers of such amounts whenever necessary, or may be augmented by trans-
fers of additional amounts from the Surplus Account described below if determined by
the City Council to be necessary to meet contingencies arising in the operation and
maintenance of the system. Moneys in the Operating Account shall be used solely for
the payment of current operating expenses of the sewerage system as herein defined,
8.03 Revenue Bond Account. The net revenues of the municipal sewerage
system, as referred to in this ordinance, are here -by defined to include the
antire amount of such gross revenues remaining upon each such apportionment,
after crediting to the Operating Account the amount required in part 8.02
hereof, including sums required to create and maintain the Operatinp, Reserve
at the minimum amount thereon stated. Upon each apportionment there shall be set
aside and credited to the Revenue Bond Account out of the net revenues an amount
equal to at least one -sixth of the total sum of the principal and interest to
become due within the then next succeeding six months on all bonds herein auth-
orized and on all bonds refunding the same (exclusive of principal and interest
for the pay�ent of which funds have been placed in escrow as provided in Section
7,03); and the entire remainder of the net revenues on hand shall also be cre-
dited to the Revenue Bond Account until there shall have been accumulated in that
account an additional reserve, which shall thereafter be maintained by the
transfer of additional net revenues whenever necessary, in an amount at all times
at least equal to the maximum amount of principal and interest to fall due on all
si�cb bonds within any subsequent calendar year. Moneys from time to time held
in the Revenue Bond Account shall be disbursed only to meet payments of principal
and interest on such bonds as such payments become due, and the reserve therein
sball be used only to pay maturing principal and interest when other moneys
within the account are insufficient therefor; provided that on any date
when all outstanding bonds of the issue are due or -orepayable by their terms, if
Ile
,l'-e e,,_-�ount then on hand in the Revenue Bond Account, including the reserve, is
2officiunt to pay all such bonds and the interest accrued thereon in full, it may
be used for that purpose. If any payment of principal or interest becomes due when
n�neyw in the Revenue Bond Account are temporarily insvfficient therefor, such pay-
ment stall be advanced out of"any net revenues theretofore segregated and then oil
ww" in the Replacement and Depreciation Account or the Surplus Account
8.04 Peal Wment and Denreciation ------ : . There shall next be set aside and
craditt�d upon each cuc;i to the Replacement and Depreciation Account
such portion of the not revenues of the system, in exceis of the current require -
nests of the Revenue Bond Account (which portion of the net revenues is referred to
herein as "surplus net revenues"), as the City Council shall determine to be re-
quired for the accumulation of a reasonable allowance for depreciation,of the sys-
tem and for replacement or renewal of worn out or obsolete properties comprised
therein, Moneys in this account shall be used only for the purposes above stated
or, if so directed by the Council, to redeem revenue bonds which are prepayable
accandioa to their terss, or to pay principal or interest wben due thereon as re-
quired in part 8.03 hereof; provided that in the event that the City shall hereafter
issuc bonds over and above the amount heretofore authorized, for the purpose.of
financing the construction and installation of additional improvements or yKitions
to the sewerage system, surplus net revenues from -time to time received may be se-
gregated and paid into one or more separate and additional accounts for the payment
of such boLds and interest thereon, in advance of payments requir-" -ode into
the Replacement and Depreciation Account.
8.05 2jL2ly2_Ac2ojnt0 Any amount of the surplus net revenues from time to
tine remaininG after the above required applications thereof shall be credited to
tha Surplus Account, and the moneys from time to time in that account� whe4 not re-
quired to restore a current deficiency in the Revenue Bond Account an provided in
part 8.03 hereof, may be used for any of the following purposes and not otherwise;
-o redeem and prepay bonds payable from the net revenues when And
as such bo"ds become prepayable according to their terms; or
W) To purchase such bonds on the open market, at a price to yield the
City a net return, based on the dollar amount of interest payable to the re-
wDective maturities of bonds so purchased, or to the earliest dates upon which
they are prepayable according to their terms, which bonds shall:be canceled.
forthwith upon being so purchased; or
(c) To be held as a reserve for redemption and prepayment of bonds pay-
able from the net revenues which are not then but will later be.prepayable ac-
cording to their terms; or
(d) To pay for repairs of or for the construction and installation of
improvements or additions to the sewerage system; or
(e) To restore the Operating Reserve or increase the same when determined
to be necessary by the City Council.
8.06 Tran No moneys shall at any time be transferred from the Surplus
Account or any other account of the Sewerage System Fund'to any other fund of the
City, nor shall such moneys at any time be loaned to other municipal funds or in-
vented in warrants, special improvement bonds or'other obligations payebla from
such other funds.
Section 9. Q,12sit and Investment of Funds. The City TreesUrer shall
cause all moneys pertaining U-ne Sewerage System Fund and the Sewe�,aF�a System
Lrprovement Fund to be deposited as received with one or mDre depository banks dul�
qualified in accordance with the provisions of Section 16-208 of an Revised Codes
of Montana 1947, in a deposit account or accounts which shall be maintained senarate
and a -Dart from all other bank accounts of the City Of Kalis.Oell, SO lOn3. as any of
the bonds issued hereunder and the interest thereon shall remain unpaid, and the
balarice in such acco=tsv exceot such portion thereof as shall be gua-rauteed by
federal deposit insurance, Shall at all times be secured to its full mount of
bond�� or securities o� the t.-mes set forth in Section 16-2618, No MoneYs shall at
any time be withdrawn from such deposit account or accounts except for the purposeo
of the Sewerage System Fund and the Sewerage SysteLi Improvement Fund as defined and
authorized in this Ordinance; except that money% from time to time an hand in either
of these funds, in excess of amounts required to be paid from such fund witbin. the
next succeeding twelve months, may at axy time, in the discretion of the City Coun-
ci!5 be invested lin securities which are general obligations of the United States
of A—merica, maturin� not more than five years from the date of such investment; and
provided further that moneys pertaining to the Surplus Account of the Sewerage
System Fund may, in the 4iscretion of the Council, be invested in any securities
which are gerieral obligatiOns of the United States of America or are general o1bli.ga-
tions of the City of Kalispell. The income received from any such investments shall
be credited to the fund and account from whose moneys the investment was purchased,
and handled and. accounted for in the same manner as other moneys in that fund or
account,
Section 10. Additional Covenants. The City of Kalispell further covenant
and agrees with the purchaser or holders from time to time of all of the bonds here-
in authorized and referred to:
10.01 That it will maintain and hold the municipal sewerage system free from
all liens thereon or oa the income therefrom other than the liensherein granted or
provided for.
10.02 That it will continue to operate that system as a public utility and
convenience of the City and will not establish or authorize any other system for
supplying service in competition therewith.
10.03 That it will at all times keep the system and the various parts thereof
insured "by reputable carriers, in amounts and &�,ainst all risks for like pro-
pert�es are customarily insured by prudent owners thereof, and will z:.�t all times
keep persons handling funds of the system adequately bonded for the faithful per-
formance of their duties and to account for and pay over such moneys to the City,
and in the event of loss or default covered 'by any such iiisurance or bond, will use
and apply the proceeds thereofsto restore the loss or damage or to pay and redeem
bonds payable from the Revenue Bond Account.
10.04 That no portion of the gross or net revenues at any time derived from
the sewerage system will ever be leaned, invested, used or applied in any manner or
for any purpose other than as specifically prescribed and p�rmitted in this ordi-
nance.
10-05 That it will at all times keep pro-cer and adequate books of account
shaving all receipts and disbu-,-��ements of moneys derived frou the operation of the
system and the bonds issued hereunder, in accordance with the laws of the State of
Montana, which 'books shall show the segregation and application of the revenues of
the system in accordance with the provisions of this ordinance, and such boo3�s shall'
be open to inspection and copying during all reasonable businegs hours by the holder
of $5,000 or more principal amount of the bonds Issued hereundi�r or his agent or
attorneys.
10.06 That it will cause such books to be maintained on the basis of a calen-
dar year commencing January 1, 1968, and ending December 31 of each year and to be
audited for each calendar year by certified public accountants, andwill, on request -
without cost, furnish a copy of the report of any such audit to any holder of $5,000
or more principal amount of bonds issued hereunder. The retort of audit, in ad-
dition to whatever matters may be thought proper by the certified public accountant,
shall include the following:
(a) A statement in detail of the income and of the sewcr-
aSo systom for the calendar year, separating and Identifying capital cNpe"Wturcs
fyw� onixoring axpWitures.
(b) A balance shoat as of the end of the calendar year.
W) A 6etermination that the audit shows full compliance with the
1=avklons of this ordinnnce during the year covered thereby, includinS proper
scCrn3ation uF the capital expanditures from operating expenses, maintenance of
Ho re(pNed balance in the Revenue Bond Account, and receipt of net revenues
WHO the yoar at least equal to Lhe maximum amount of principH and intcrest
psynble in any subscquent calendar yQzr from the Revenue Bond Account; or, if
the Wit shou3d reveal that the revenues have been insufficient for compHanac
KIt this ordinanco, or that the methods7used in accounting for such revenins
suro conLrnry to any provision of this ordinance, the report of audit shall
InQuic a full expicnation, thereof, together with the accoMam's reQcamandatio%',
for such cVnSe in rates or accounting practices or in the operation of the
nysLuv as no, he required.
(d) A list of the insurance policies and fidelity bonds in force at
the W of the calendar year, setting out as to each the anount Lhers0f, the
r!"kS CovCTU0 thereby, the name of the insurer or surety and the expiration date
M the policy or bond.
(a) 74-- n%,�nbar of premises connected to the sewerage sys,tem at the
enj V the ywar,
The City will also cause to be prepared and forwarded to the purchaser Of the
bau6s her"In authorized not later than the 15th day of january and July Qf each
year, a rayart showinS the cash receipts of and cxpenOltures from each of the
severW accounts of the Sewerage System Fund7during the preceding six manths and
the cash balance on hand in and the amount of'unpald warrants outstandin,
ajainsL each Of suab accounts as of the last day of such preceding month.
1007 ThaL the holders oE 25% or nere in aggregate principalamount Or
M bonds Vich are at any time outstanding and payable from Lhe Revenue Bond
Account may, citber at law or in equity, by suit, action, wandumus, or other
pynnewdinSs, protect and enforce the rights of all owners of �such bonds, and
caforce and compel the performance of all covenants and duties of the City and
M offMals as herein specified, including the fixing and maintainina of suffi-
Mcnt rates, charges and rentals for the services affor0ed by the system, the
collection and proper seZr,aticr of the reveives, and the proper applicati-M thet
of.
&.C3 That the insur�ince znnd fidelity bone premlons and the cost of the
hookhompWL and audits herein provided for and of the billing and collection of
wbe Lsvnx rates, char3es and ronuals shall be payable from the Operating Account.
1029 That cNcepo as heroin expressly authorized, no obliLation will be
KcVrrod by tho CIL; and made payable from revenues Of the TaUTIMPal sewcyc&
&yvoe�, w1nober or not such Obligation shall also constitute a 2onern! obll;a-
tion end ninbtednote of the City, unless the lien thereof shall be eNpressly
unjQ subordinate to the lion of the bands payable frem the Revenue Bono Account
00 the net income and ravenue of the system.
10.10 That whiiQ any bonds payable from the Revenue nond Account &rc
amann0n; and unpaid, the rates for all and made available
by AU sowarage system to the City and to Its inhabitants, and to all customers
u1nin ok nithout the boundarles of the'City, shall be rensonable ane just,
owhino into consWeration the cost and value Of the system and the cost of
mLw:aWV3 and operating it, and the amounts necessary for the payment Of all
bonds nni the accru>3 interest thereon, anj the proner Vne naceSs8ry alloomnoes
for the of the system, and no free service shall he provided to any
parscn or ccrporstion. Thore are to be initially charted aSalnst. all receipts
of sovXrzle service, incluoino Qe City, the rates, cber;cs and rentals
omblishcd in Ordinance Vo.632, 10ch are calculated,
-10-
on the basis of anticipated sewer usage, to be sufficient to produce in eac1%
calendar year net revenues available for the Revenue Bond Account in an amount
at least equal to the sum of the principal and. interest to become due in �;,ny
siabsequent calendar year an the bonds herein authorized. The excess of the net
'reveaues over ��Q uzjrqaj principal and interest and reserve requirements of the
bonds may, in accordance -with Section 8 hereof, be used for replacemen�s, re-
newals and capital improvements of utility property, and for the payment of the
bonds in advance of their maturities. The bonds may be prepaid accordi g to
n,,
their terms on and after Yay 1, 1973, end in the estimation of the Council any
excess, prior to that date, of net revenues over principal and interest payments
actually due and the reserve required to be maintained therefor, will 'be needed
to pay or to provide reserves for payment of replacement, renewal and improvement
costs, in order to provide adequate service for the present population and the
increase thereof reasonably to be expected; and after that date any excess not
required for such purposes in the judgment of the Council may be used to prepay
bonds and thereby to reduce the interest cost thereon to the City and to the
persons served by the seweraee system. Accordingly it is covenanted and
that such rates, charges and rentals shall be maini, ned, and hall be revised
whenever and as often as may be necessary, according schedules such that the
gross revenues 'will be at least sufficient to pay the c�lrrent expenses of oper-
ation and maintenance as herein defined and to maintain the operating reserve
herein established and to produce net revenues fulfilling'each of the following
conditions:
10.101 That the net revenues received during each calendar vear shall be
not less than 100% of the sum of the principal and interest payable from the
Revenue Bond Account during any subsequent calendar year,
10.102 That if at the close of each calendar year the net revenues
actually received during such year have been less than required in part 10.101
hereof, the City will forthwith prepare and place in operation a schedule of
altered rates, charges and rentals which are just and equitable and sufficient
to produce net revenues in such amount.
10.11 That the City shall be charged with the responsibil�.ty for the
proper billing, collection and application of all charges due for service
rendered and made available by the system, and for the discontinuance of service
in case of nonpayment of charges or noncoirmliance with regulations. Any failure
on the part of the City to comply and to enforce compliance on the part of all
officers and employees concerned with the Drovisions cf this ordinance, and
with the City's otZier regulations respecting the sewerage system, shall con-
stitute malfeasance for which the City and the surety on its bonds shall be
personally liable. In the event of default on the part of the City in the pay -
of principal of or interest on any bond promptly as each falls due, or in the
heeping of any covenants herein contained, and if such default shall continue
for a period of sixty days the Council will appoint a special superintendent for
the system, with the power and responsibility to aperate the system for the
City of Kalispell, and to recommend to the Council such revisions of the rates
and charges and operating policies as may be necessary to comply with this or-
clinance, and to assure that the net revenues will be sufficient to pay all bond
principal and interest, and he shall. in all things so operate the system as to
fully comply with all the requirements and provisions of this ordinance. The
right of the holders of the bonds to require employment of such a superintendent
shall not be exclusive, and in the event of default as herein outlined, such
holder or holders shall have the right to proceed at law or in equity to require
the performance of the covenants herein contained, in any form of action which
shall to them seem appropriate.
-,0,12 That employees collecting 'bills or handlinpr, other funds Of the
s, Byat=
�IeDos4t such funds in the bank at lesst, as often as the
,;�o c�a hand in the -oossession of the City shall az,_ount to y,
10. 13 7nat the rvles anO, regulat,' ons for oneration, of the Sewer Department
-,�',e use of sewer service from the systern shaill, ne as T)rovided in the existing
or�,'Ln,lnces of the City, and Any ordinances subsequently adopted amemdatory
the,re:o2 or supplemental t"Iereto.
10.1
� -4 7rat the charges will be collocted by the City or by the Co tv
Treasu]�,er not less Often thar, z cmi annu ally; and if the bi.11 is not paid within
�O 6,wrs the due date , or if t,,,e customer fails to comply with all rules
and e�,tsblii�;hed for the water system within 6G days after notice of
v.�olation tnea�cof (which notice shall be given promptly upon discovery of. any
violation), the sever service to the premises involved shall be discontinueL
an� - .0
not I,e resujaed until payment of all past -due bills I r sewer servie-
and conpliance 'With all such rules and regulations.
Sectio, 11. Rates and Charr,,e5, Until modified in accordance with law
-�he rates, cl-It-irr
'es and rentals to be imposed and collected 'or sewer service
and raa�e available by the system, and for connections thereto. shall be
4� -
p. OVio.ed Ordinance No.
__L�,2 of the City.
�>e cti on, 12. Reooals, All provisions of ordinances, resolutions and
ot',�er act"ons an� proceedings of the City and of the City Council which are in
a.ny way inconzisient with the terins and provisions of this ordinance are hereby
amende� and rescinded to the full extent necessary to givefull force
and effec-� to the provisions of this ordinance.
Section 13. Effective Date. This ordinance shall be in fula force and
ef.'ec' from and a:ter its final passage and approval according to law.
Passed br the City Council and approved by the Payor of the City of
Xalispell,� Moz�ta,14,, this 3rd day of itine , 1968.
1, the undersigned, City Clark of the City of Xa21spell, hereby certify
that the foregoing is a true and correct copy of the resolution duly
passed by the City Council,,� the City of Kalispell, Moatana, at a
regular meeting on jl�u �I � 1, 9 f) 3 . �`)
ity�Cler� of the/City of xalispslZ, Mlontana