Number
021588
Version
ORIGINAL
Reference
Sponsor
THE CHAIR
Title
Resolution authorizing issuance of short-term promissory notes (revenue anticipation notes) for the purpose of financing the operating budget on an interim basis. (Comptroller)
Analysis
Resolution authorizing short-term promissory notes (revenue anticipation notes) under s. 67.12(1), Stats., for the purpose of financing the City's operating budget on an interim basis.
Body
Whereas, s. 67.12(1), Wis. Stats., authorizes any municipality entitled to receive deferred payments from the State to issue municipal obligations in an amount not to exceed 60% of the total actual and anticipated receipt of deferred payments in the fiscal year; and
Whereas, Pursuant to s. 79.02, Wis. Stats., the City of Milwaukee is anticipating receipt of shared revenue payments from the State of Wisconsin in 2003 (the "Budget Year") the amounts of $45,478,150 and $204,442,850 in the months of July and November, respectively, of the Budget Year; and
Whereas, The foregoing amounts represent 45% of the City's General Fund operating revenue for the Budget Year; and
Whereas, Operating expenditures are incurred on a uniform basis throughout the year; and
Whereas; The City must finance the operating budget on an interim basis between now and the receipt of State shared revenue payments in July and November of the Budget Year; and
Whereas, The City is interested in borrowing to finance the operating budget on an interim basis and pledges the anticipated revenue included in the budget for the Budget Year due and not yet paid as security for repayment of such obligations; now, therefore, be it
Resolved, By the Common Council of the City of Milwaukee, that it hereby and herewith authorizes and declares its purpose to issue short-term promissory notes pursuant to the provisions of s. 67.12(1), Wis. Stats., in an amount not to exceed $125,000,000 for the purpose of financing the operating budget on an interim basis pending receipt of State shared revenue payments in July and November of the Budget Year; and, be it
Further Resolved, That said promissory notes be sold by the Commissioners of the Public Debt at public competitive sale; or to the Public Debt Amortization Fund for the purpose of investment; or to the Public Debt Amortization Fund for immediate cancellation; and, be it
Further Resolved, That said promissory notes shall be dated the date of initial delivery of the Notes, shall have a maturity not to exceed one year, but in no event later than six months from the date the City expects to receive the revenues in anticipation of which the notes are issued, and shall be registered in the name CEDE & CO., as nominee of the Depository Trust Corporation, New York, New York, and shall not be subject to redemption prior to maturity; and, be it
Further Resolved, That said promissory notes shall be designated, and bear interest, payable at maturity, at coupon rates, as determined by the Commissioners of the Public Debt; and, be it
Further Resolved, That a Continuing Disclosure Certificate, in substantially the form customarily provided by the City to be dated the date of initial delivery of the Notes, is authorized to be executed and delivered by the Comptroller; and, be it
Further Resolved, That the obligation of the City of Milwaukee under the aforementioned disclosure certificate under the terms therein specified is determined to be contractual for the benefit of the note holders from time to time; and, be it
Further Resolved, That the City of Milwaukee authorizes and directs the appropriate officers and employees of the City to take all action necessary or appropriate to comply with and carry out all of the provisions of the Continuing Disclosure Certificate as amended from time to time. Notwithstanding any other provision of the resolution, failure of the City to perform in accordance with the Continuing Disclosure Certificate shall not constitute a default under the resolution and the Continuing Disclosure Certificate may be enforced only as provided therein; and, be it
Further Resolved, That the Common Council hereby declares that as security for the repayment of the notes with interest thereon, the City will pledge and irrevocably segregate upon receipt through December 31, 2003 shared revenue payments due in November, 2003, in an amount sufficient to pay the principal and interest due on the notes at maturity; and, be it
Further Resolved, That as additional security for the repayment of the notes and interest thereon, the City hereby declares that it will irrevocably pledge all other general fund revenues included in the budget for the Budget Year which are due the City and not yet paid as of the date of delivery and payment for the notes and which are not otherwise applied; and, be it
Further Resolved, That if the Notes mature after December 31, 2003, the proper City officers be and hereby are authorized and directed to irrevocably deposit with the trustee on or before December 31, 2003 general fund revenues to purchase direct obligations of, or obligations guaranteed by, the U.S. Government in an amount sufficient to pay the principal and interest due on such notes at maturity; and, be it
Further Resolved, That such promissory notes shall not constitute an indebtedness for the purpose of determining the municipality's constitutional debt limitation, and no tax shall be levied to pay such obligations; and, be it
Further Resolved, That said notes are not intended to be arbitrage notes and that there is no reasonable expectation of the City of Milwaukee realizing arbitrage proceeds.
Requestor
Comptroller
Drafter
RL
2/11/2003
PD-6431W.doc