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HomeMy WebLinkAbout01291981SPECIAL MEETING- JANUARY 29, 1981 THE CITY ATTORNEY READ THE RESOLUTION AUTHORIZING A NEGOTIATED SALE OF THE CITY OF SEBASTIAN'S GOLF COURSE REVENUE BOND ANTICIPATION NOTES IN THE PRINCIPAL AMOUNT OF $1,600.000 AND AWARDING SUCH NOTES TO THE PURCHASER THEREOF. MOTION BY COUNCILWOMAN Mc KINL~Y, SECONDED BY COUNCILMAN GAGS, THAT THE ABOVE RESOLUTION BE ADOPTEDAS READ AND THAT THE RESOLUTION ALSO ADOPT THE FiVE YEAR NOTES. ROLL CALL VOTE: AYES: NAYS: COUNCILMAN GASS MAYOR FLOOD NONE. CARRIED. THE MAYOR ENTERTAINED A MOTION FOR THE COUNCIL TO CALL A MEETING, AND INVITE MR. ANKROM, NEGOTIATIONS WITH THE LOW BIDDER. TO START MOTION BY COUNCILMAN GASS, SECONDED BY COUNCILWOMAN MC KINLEY, TO START NEGOTIATIONS WITH THE LOW BIDDER. ROLL CALL VOTE: AYES: COUNCILMAN OBERBECK COUNCILWOMAN MC KINLEY COUNCILMAN GASS MAYOR FLOOD NAYS: NONE. CARRIED. A MEETING WILL BE TENTATIVELY SCHEDULED FOR WEDNESDAY, FEBRUARY 4TH, TO START NEGOTIATIONS. WM. R. HOUGH & CO., iN CITY CLERK MAYOR SPECIAL MEETING - JANUARY 29, 1981 MAYOR PAT FLOOD, JR. CALLED THE MEETING TO ORDER AT 7 P.M. PRESENT: COUNCILWOMAN MC KINLEY , COUNCILMAN GASS, COUNCILMAN OBERBECK, MAYOR FLOOD AND CITY ATTORNEY, MR. KILBRIDE . MAYOR FLOOD EXPLAINED THE PURPOSE OF THE MEETING WAS TO GO INTO THE BONDING OF THE GOLF COURSE TO DETERMINE, AFTER D'ISCUSSION; IF THE BONDING WOULD BE ACCEPTABLE TO THE CITY COUNCIL. A REVISED RESOLUTION HAS BEEN WRITTEN TO MAKE THE BONDS MORE SALABLE! WHICH THE CITY ATTORNEY WILL BE ASKED OT READ. THE CITY ATTORNEY DISCUSSED FIRST, HOWEVER, A PROPOSED NEW DEFINITION IN THE TRUST INDENTURE, PAGE 7, "NON AD VALOREM FUNDS" OF "THE PRELIMINARY OFFICIAL STATEMENT" ISSUED JANUARY 2, 1981. THE NEW"DEFINITION, AS IT APPEARS IS AS FOLLOWS: "NON-AD VALOREM FUNDS SHALL MEAN ALL MONIES OF THE ISSUER DERIVED FROM SOURCES OTHER THAN AD VALOREM TAXATION WHICH SHALL, FROM TIME TO TIME, BE LEGALLY AVAILABLE FOR APPLICATION PURSUANT TO THE PROVISIONS OF THIS INDENTURE. MONIES OF THE ISSUER WHICH, THOUGH DERIVED FROM SOURCES OTHER THAN AD VALOREM TAXATION, SHALL BE COMMITTED TO OTHER USES BY LAW OR CONTRACT ARE NOT LEGALLY AVAILABLEFOR APPLICATION PURSUANT TO THE PRO- VISIONS OF THIS INDENTURE. AND, AFTER ALL NOTES AND THE INTEREST THEREON SHALL HAVE BEEN FULLY PAID, THE ISSUER SHALL NOT BE PREVENTED HEREBY FROM GRANTING A FIRST LIEN ON ANY SPECIFIC NON AD VALOREM REVENUES AS SECURITY FOR ANY OBLIGATION UNDERTAKEN BY THE ISSUER SUBSEQUENT TO THE ISSUANCE OF THE BONDS, WHICH SPECIFIC REVENUES TO THE EXTENT REQUIRED FOR SUCH FUTURE OBLIGTIONS SHALL THEREAFTER NOT BE DEEMED TO BE LEGALLY AVAILABLE FOR APPLICATION PURSUANT TO THIS INDENTURE AND NOT BE REGARDED AS A PART OF NON ADVALOREM FUNDS. WHILE ANY NOTES OR THE INTEREST THEREON SHALL REMAIN UNPAID, THE ISSUER MAY GRANT A LIEN ON ANY OR ALL NON AD VALOREM 9EVENUES AS SECURITY FOR ANY OBLIGATIONS OF THE ISSUER PROVIDED THAT EACH SUCH OBLIGATION SHALL STATE ON ITS FACE THAT THE LIEN ON THE NON AD VALOREM REVENUES GRANTED BY THE ISSUER AS SECURITY FOR THE PAYMENT OR SUCH OBI~IGATION IS JUNIOR, SUBORDINATE ~D~NFEBJO~ IN ~V~R~ ~gPECT TO THE LIEN ON SUCH NON AD VALOREM BASICALLY, ,~R. KILBRIDE STATED, TH~ ABOVE DEFIN,rTrON AyD~ THE ~T COMPLETE SENTENCE WHICH STATES THAT IF IN THE FUTURE THE CITY EVER '.~S TO GEF rNTO TH~ WATER & SEWER BUSINESS, AS AN EXAMPLE, AND SELL BONDS FOR THAT PURPOSE ANN..~F~/THE SAME.VON'~ A~[ZALOREM'' FUNDS AS ADDITIONAL COLLATERAL FOR THOSE BONDS, THAT THIS REVENUE BO'ND ISSUE FOR THE GOLF COURSE WILL NOT PREVENT THE CITY FROM DOING THAT. ONLY THAT THE BOND HOLDERS OF THE WATER & SEWER BONDS WILL KNOW THAT THE LIEN ON THE NON AD VALOREM. FUNDS WILL BE JUNIOR TO T~N ~ THE GOLF COURSE REVENUE BOND HO~JDERS HAVE. THE SECOND REQUESTED CHANGE TO SECTION 506 ~ TILE u~UST INDENTURE, PAGE 24 "CREATION OF LIENS" IS AS FOLLOWS: "THE ISSUER COVENANTS THAT EXCEPT AS HERA~O~,~ED IT WILL NOT ISSUE ANY OTHER BONDS, NOTES, HEREBY RESERVES [¢~.9 9r~_~o rS~Et ~RO~_~ ~rM{~.9 ~)IME, ~FTE_~ AL~ ~OT~ .~N[~ mTEREST THEREON SHALL HAVE BEEN EULLY 'e F3 ,S BpN S___ 5 O TZJ R T3L NS SS_.CURE SYI3 Fr 3T UPON AND PLEDGE OF ANY SPECIFIED SOURCE OR SOURCES OF REVENUE PRESENTLY A PART OF NON-AD VALOREM FUNDS, AND THE PLEDGE IN FAVOR OF THE BONDS OF THE REVENUES FROM SUCH SOURCE SHALL THEREAFTER BE SUBORDINATE AND INFERIOR TO THE LIEN THEREON AND PLEDGE THEREOF IN FACTOR OF SUCH SUBSEQUENT OBLIGATIONS MADE EXPRESSLY PAY- ABLE THEREFROM. AND WHILE ANY NOTES WITH THE INTEREST THEREON SHALL REMAIN UNPAID, THE ISSUER MAY GRANT A LIEN UPON AND PLEDGE ANY SPECIFIED SOURCE OR SOURCES OF REVENUE PRESENTLY A PART OF NON AD VALOREM FUNDS AS SECURITY FOR ANY OBLIGATIONS OF THE ISSUER PROVIDED THAT EACH SUCH OBLIGATION SHALL STATE ON IT FACE THAT THE LIEN ON SUCH NON AD VALOREM FUNDS GRANTED BY THE ISSUER AS SECURITY FOR THE PAYMENT OF SUCH OBLIGATION IS JUNIOR, SUBORDINATE AND INFERIOR IN EVERY RESPECT TO THE LIEN ON SUCH NON-AD VALOREM FUNDS HEREBY GRANTED IN FAVOR OF THE NOTES." MR. KILBRIDE EXPLAINED THE LANGUAGE WAS CHANGED TO COMPLY WITH THE CHANGE IN THE DEFiNiTION OF NON- AD VALOREM FUNDS AND FOR THE PURPOSE OF ADVISING ANY FUTURE BOND HOLDERS OF THE EXISTENCE OF THIS "' ~' BOND ISSUE. THE CITY ATTORNEY READ A LETTER ADDRESSED TO THE MAYOR AND MEMBERS OF THE CITY COUNCIL, IN WHICH THEY AS THE "UNDERWRITER" OFFERED TO PURCHASE $1,600,000 CITY OF SEBASTIAN, FLORIDA GOLF COURSE REVENUE BOND ANTICIPATION NOTES, SERIES 1981, SUBJECT TO SPECIFIC TERMS AND CONDITIONS. (COPY OF LETTER ATTACHED). THIS FIRST PROPOSAL WAS FOR TWO YEAR NOTES AND A SECOND PROPOSAL RECEIVED IS IDENTICAL IN ALL RESPECTS EXCEPT FOR CERTAIN FINANCIAL FIGURES AND ONE IS THAT THE NOTES WOULD BE FIVE YEAR NOTES TO MATURE MARCH 1, 1986 ALSO AT 10% AND THE UNDERWRITER AT THE CLOSING WOULD PAY $1,558,400. NET INTEREST COST FOR THE TWO YEAR NOTES WOULD BE 10.95 AND THE FiVE YEAR NOTES WOULD BE 10.52. MAYOR FLOOD COMMENTED THE 10% WAS OVER WHAT THE COUNCIL HAD PREVIOUSLY APPROVED SO IT WOULD BE NECESSARY TO DECIDE WHETHER THE COUNCIL WOULD AGREE TO INCREASE THE PERCENTAGE GUIDELINE FROM 9% TO 10%. MOTION BY COUNCILWOMAN Mc KINLEY, SECONDED BY COUNCILMAN GASS, 9% TO 10%. ROLL CALL VOTE: AYES: COUNCILMAN OBERBECK COUNCILWOMAN Mc KINLEY COUNCILMAN GASS MAYOR FLOOD TO INCREASE THE PERCENTAGE RATE FROM NAYS: NONE. CARRIED.