HomeMy WebLinkAbout7923RESOLUTION 7923
A RESOLUTION CONCERNING PROPOSED CITY OF PUEBLO,
COLORADO, SEWER REVENUE REFUNDING BONDS,
SERIES, 1996; APPROVING AND DIRECTING A NEGOTIATED
SALE OF SUCH BONDS; APPROVING AND ADOPTING AN
AMENDMENT TO THE AGREEMENT FOR FINANCIAL
ADVISORY SERVICES BETWEEN THE CITY AND PRINCIPAL
FINANCIAL SECURITIES, INC.; AND PROVIDING THE
EFFECTIVE DATE OF THIS RESOLUTION
WHEREAS, the City of Pueblo, Colorado, in the County of Pueblo, State of Colorado
(the "City ") is a municipal corporation duly organized and existing as a home -rule city pursuant to
Article XX of the Constitution of the State of Colorado (the "Constitution ") and the Home Rule
Charter of the City (the "Charter "); and
WHEREAS, the City has authority under its Charter and the Constitution to issue sewer
revenue refunding bonds; and
WHEREAS, pursuant to Ordinance No. 5341, adopted on second reading on August 25, 1986
and amended by Ordinance No. 5551, adopted on second reading on July 24, 1989, the City issued
its City of Pueblo, Colorado, Sewer Revenue Refunding Bonds, Series 1986 (the "Series 1986
Bonds ") in the initial aggregate principal amount of $11,600,000, of which $11,195,000 aggregate
principal amount will remain outstanding on December 1, 1996; and
WHEREAS, the City has the option to redeem the Series 1986 Bonds maturing on or after
June 1, 1997, which are subject to prior redemption on and after December 1, 1996; and
WHEREAS, the City Council has determined that, due to lower interest rates and resulting
debt service savings, it is in the best interests of the residents of the City for the City to issue sewer
revenue refunding bonds (the "Bonds ") to refund the outstanding Series 1986 Bonds on a current
basis, by paying those Series 1986 Bonds maturing on December 1, 1996 at their maturity and by
calling for early redemption on December 1, 1996, the Series 1986 Bonds maturing on or after June
1, 1997; and
WHEREAS, the City and Principal Financial Securities, Inc. ( "Principal Financial ")
previously entered into an Agreement For Financial Advisory Services, dated as of May 1, 1996 (the
"Financial Advisory Agreement "), which provides that the Financial Advisory Agreement shall be
applicable to all municipal securities issued by the City during the three -year term of the Financial
Advisory Agreement, except for certain exceptions and unless otherwise directed by Resolution of
the City Council; and
WHEREAS, Principal Financial previously has made presentations to the City concerning
the issuance of the Bonds by the City, showing the potential savings to be derived from such a
current refunding; and
WHEREAS, the City Council has determined and hereby determines that it is in the best
interests of the residents of the City that the Bonds be sold by the City to Principal Financial on a
negotiated basis, after authorization by an Ordinance to be adopted hereafter, rather than offered for
public sale on a bid basis because of, among other reasons, the ability of the City in a negotiated sale
to take advantage of timing in a volatile interest rate market; and
WHEREAS, Rule G -23 of the Municipal Securities Rulemaking Board requires in such a
situation (a) that a financial advisor such as Principal Financial make certain disclosures concerning
(I) possible conflicts and (ii) the source and anticipated amount of all remuneration it will receive
for underwriting the Bonds and (b) and that an agreement be signed to except the municipal
securities being sold on a negotiated basis from the Financial Advisory Agreement; and
WHEREAS, Principal Financial will make the disclosures required by Rule G -23 in writing
to the City prior to the execution of an Amendment dated as of September 1 , 1996 (the
"Amendment "), to the Financial Advisory Agreement, which Amendment has been prepared and
presented to the members of the City Council at this meeting;
NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, THAT:
Section 1 . The City hereby deems it to be in the best interests of the residents of the City that
sewer revenue refunding bonds to refund the Series 1986 Bonds be, and the same hereby are ordered
to be, sold in a negotiated sale to Principal Financial Securities, Inc., subject to the unqualified
approving bond counsel opinion of Kutak Rock, and the City specifically consents to the purchase
of the Bonds by Principal Financial on a negotiated basis. The City understands that Principal
Financial may offer a portion of the Bonds to or through broker /dealers and banks located within the
City.
Section 2 . The City Council hereby approves and adopts the form of Amendment as presented
at this meeting and, subject to receipt from Principal Financial of the disclosures required by Rule G-
23, hereby authorizes and directs the President or Vice President of the City Council to execute the
Amendment in the name and on behalf of the City, and further hereby authorizes and directs the City
Clerk or one of her deputies to affix the official seal of the City to the Amendment and attest to the
seal and the signature of the President or Vice President, all with such changes in the Amendment as
may be approved by the City Attorney and the President or Vice President of the City Council, the
signature of the President or Vice President to be conclusive proof of that approval.
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Section 3 . The President and Vice President of the City Council and the Finance Director of
the City are hereby directed to take all other action necessary or appropriate to effectuate the
provisions of this Resolution. All action heretofore taken (not inconsistent with this Resolution) is
hereby ratified, approved and confirmed.
Section 4 . If any section, paragraph, clause or provision of this Resolution shall for any
reason be held to be invalid and unenforceable, the invalidity and unenforceability of such section,
paragraph, clause or provision shall not affect adversely any of the remaining provisions of this
Resolution.
Section 5 . This Resolution shall take effect immediately upon its introduction and passage.
INTRODUCED August 12 , 1996
BY. Rarmic-1 Corsen _l rlo
Councilperson
APPROVED:
Presid t of the Council
ATTEST:
City Clerk
APPROVED AS TO FORM:
A
City Attorney -`
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FIRST AMENDMENT TO
AGREEMENT FOR FINANCIAL ADVISORY SERVICES
THIS FIRST AMENDMENT TO AGREEMENT FOR FINANCIAL ADVISORY
SERVICES is entered into as of \ \ September L , 1996 (this "Amendment "), by and between the
City of Pueblo, Colorado, a duly organized municipal corporation, and Principal Financial
Securities, Inc., \ \(the "Company ").
WHEREAS, the City and the Company previously entered into an Agreement For
Financial Advisory Services, dated as of May 1, 1996 (the "Financial Advisory Agreement "),
which provides that the Financial Advisory Agreement shall be applicable to all municipal
securities issued by the City during the three -year term of the Financial Advisory Agreement,
except for certain exceptions and unless otherwise directed by Resolution of the City Council;
and
WHEREAS, the City Council has determined that, due to lower interest rates and
resulting debt service savings, it is in the best interests of the residents of the City for the City
to issue sewer revenue refunding bonds (the "Bonds ") to refund on a current basis the City of
Pueblo, Colorado, Sewer Revenue Refunding Bonds, Series 1996, currently outstanding in the
aggregate principal amount of $11,195,000; and
WHEREAS, the City Council has determined and directed through the adoption of
Resolution No. 7923on \ \ August 12 , 1996, that, in the best interests of the residents of the City,
the Bonds should be sold by the City to the Company on a negotiated basis, after authorization
by an Ordinance, rather than offered for public sale on a bid basis; and
WHEREAS, Rule G -23 of the Municipal Securities Rulemaking Board requires in such
a situation (a) that a financial advisor such as the Company must make certain disclosures
concerning (i) possible conflicts and (ii) the source and anticipated amount of all remuneration
it will receive for underwriting the Bonds and (b) and that an agreement be signed to except the
municipal securities being sold on a negotiated basis from the Financial Advisory Agreement;
and
WHEREAS, the Company has made the disclosures required by Rule G -23 in writing to
the City; and
WHEREAS, the City acknowledges receipt of the disclosure by the Company of possible
conflicts between its role under the Financial Advisory Agreement and its role as underwriter
of the Bonds, as well as the disclosure of the source and estimated amount of all of its
remuneration to be received in connection with underwriting the Bonds.
WHEREAS, \ \ the Company previously has made presentations to the City concerning
the issuance of the Bonds by the City, showing the potential savings to be derived from such a
current refunding; and
WHEREAS, the City and the Company desire to except the sale of the Bonds from the
provisions of the Financial Advisory Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements contained herein, the City and the Company agree as follows:
1. Section 7 of the Financial Advisory Agreement is hereby amended and restated
to read, after such amendment, as follows:
7. Unless otherwise directed by Resolution of the City Council of City, this
Agreement shall be applicable to all Municipal Securities issued and sold
by the City during the term of this Agreement on or after May 1, 1996,
except Municipal Securities issued and sold pursuant to request by the
Board of Water Works of Pueblo, Colorado under Section 15 -2 of the
Charter of the City, the $12,850,000 City of Pueblo, Colorado Limited
Tax General Obligation Bond Series 1996 (HARP Bonds), and the issue
of approximately $12,000,000 aggregate principal amount of the City's
Sewer Revenue Refunding Bonds, Series 1996.
2. Other than the amendment made pursuant to Section 1 hereof, the remaining
provisions of the Financial Advisory Agreement are hereby confirmed as they exist.
3. This Amendment constitutes the entire understanding and agreement of the parties
as to an amendment of the Financial Advisory Agreement.
Executed as of the day and year first written above.
CITY OF PUEBLO, COLORADO,
A Municipal Corporation
By
Pr id( of City ouncil
PRINCIPAL FINANCIAL SECURITIES, INC.
By
Senior Vice President