Number
041519
Version
Substitute 1
Reference
Sponsor
THE CHAIR
Title
Substitute resolution Authorizing the Sale and Issuance of General Obligation Refunding Bonds in the amount not to exceed $90,000,000.
Analysis
Resolution authorizes and requests the Commissioners of the Public Debt to issue and sell at a private or public sale General Obligation Refunding Bonds to refund portions of certain issues. The Commissioners will refund the debt whenever it makes economic sense to do so.
Body
Whereas, The Common Council of the City of Milwaukee (the "City") has authorized the issuance and approved the sale of General Obligation debt, and as of January 1, 2005 there was $672,642,302.55 of general obligation debt outstanding; and
Whereas, The Common Council is interested in refunding all or certain portion of the Outstanding Bonds; and
Whereas, In connection with the preparation of the Official Statement for the refunding bonds, financial and economic information has been compiled by the Office of the Comptroller from its annual financial report, property tax records maintained by the Office of the Assessor and from other books and records of the City; now, therefore, be it
Resolved, By the Common Council of the City of Milwaukee that it hereby and herewith authorizes the Commission to issue and sell at a private or public sale General Obligation Refunding Bonds (the "Bonds") under the provisions of § 67.04(3) and § 67.08(2), Stats., for the purpose of refunding all or parts of the Outstanding Bonds, subject, however, to the terms and conditions hereinafter enumerated; and, be it
Further Resolved, That the Bonds shall:
(1) be in one or more series of bonds in an aggregate amount not to exceed $90,000,000;
(2) bear interest at a maximum coupon rate not to exceed 9.00% per annum;
(3) have a maximum True Interest Cost Rate (TIC) not to exceed 7.25%;
(4) be sold at a price of not less than 99% of the principal amount thereof plus accrued interest thereon from their date to the date of delivery and payment therefor; and
(5) realize a minimum net present value savings from the refunding of at least $250,000 or 2% of the refunded par value; and
(6) be issued on or before February 1, 2006; and, be it
Further Resolved, That the Outstanding Bonds to be considered for refunding, and if refunded, would be called for redemption on the first available redemption date at a redemption price of par plus accrued interest to the date fixed for redemption, are hereby designated as follows:
Series Dated Date Redemption Date
Refunding Series of 1996 2-1-1996 2-1-2006
Series H 6-15-1997 6-15-2007
Series J 12-1-1997 12-1-2007
Series L 12-15-1998 12-15-2008
Series M 12-15-1998 12-15-2008
Series R 9-1-2000 9-1-2010
Series T 9-1-2001 9-1-2011
Series U 9-1-2001 9-1-2011
Series W 3-15-2002 3-15-2012
Series Y 9-1-2002 9-1-2012
Series 2003 B1 4-3-2003 3-15-2013
Series 2004 B1 5-6-2004 2-15-2014
; and be it
Further Resolved, That the Commissioners of the Public Debt shall determine the bonds to be refunded (the "Refunded Bonds") by a the Bonds; and, be it
Further Resolved, That the Bonds, if sold at a private sale, shall be sold to such principal underwriters and other specified underwriters as are selected by the Commissioners of the Public Debt in accordance with a Contract of Purchase approved by the Commissioners of the Public Debt. Such agreement, as required if a private sale is utilized, is hereby approved in the form as executed and delivered by the proper City officers who are hereby authorized and directed to execute the same; and, be it
Further Resolved, That the Bonds shall be designated, be dated, bear interest, payable semi-annually, at coupon rates as determined by the Commissioners of the Public Debt; that the Commissioners of the Public Debt shall specify the due dates for, and the amounts of, the payment of principal of said bonds, not to exceed 20 years, and interest thereon, the redemption provisions thereof, if any, the Bonds to be callable at par with the initial call date to be no later than ten years from the date of the Bonds and that such payment schedule shall be entered upon the permanent record of the Commissioners of the Public Debt and formally communicated to the City Clerk provided, however, that the payment of the outstanding Bonds to be refunded does not extend beyond the period provided in § 67.07, Stats.; and, be it
Further Resolved, That a direct annual irrepealable tax shall be levied in each year that such Bonds are outstanding, in an amount sufficient to pay, and for the express purpose of paying the interest on the Bonds, as it falls due, and also to pay and discharge the principal thereof at maturity, and shall be extended upon the tax roll of the City of Milwaukee and shall be collected by the officers of the City in the same manner and at the same time as taxes for general City purposes for such years are extended and collected, the proceeds of said taxes shall be used solely for paying the principal and interest on the Bonds so long as any Bonds of said issue remain outstanding; and, be it
Further Resolved, That interest on or principal of the Bonds falling due at any time when there shall be on hand insufficient funds from proceeds of the tax levy for the payment of such interest or principal shall be paid promptly when due from other funds of the City, which funds shall be reimbursed thereof out of the proceeds of the taxes above levied when such taxes shall have been collected; and, be it
Further Resolved, That concurrently with the delivery of the Bonds, the City will deliver its certificate signed by its Comptroller stating that the description and statements, including financial statements, as pertaining to the City contained in the Official Statement as of its date and the date of sale and delivery of the Refunding Bonds, were and are true and correct in all material respects and do not contain an untrue statement of a material fact or omit to state a material fact required to be included therein or necessary to make the statements contained therein in the light of circumstances in which they were made not misleading; and, be it
Further Resolved, That such certificate will further confirm to the effect that insofar as the descriptions and statements including financial data, contained in the Official Statement of or pertaining to non-governmental bodies and governmental bodies other than the City are concerned, such description, statements and data have been obtained from sources believed by the City to be reliable, and that the City has no reason to believe that they are untrue or incomplete in any material respect; and, be it
Further Resolved, That it is the intention of the Common Council to approve the aforementioned Official Statement on the basis of the representation of the Comptroller to be included in the certificate signed by the Comptroller and delivered concurrently with the delivery of the Bonds; and, be it
Further Resolved, By the Common Council of the City that a Preliminary Official Statement to be distributed in connection with the sale of the Bonds, in substantially the form as the City's Preliminary Official Statement, dated February 24, 2005, is hereby approved; and, be it
Further Resolved, For the purpose of assuring the payment of the principal of and interest on the Outstanding Bonds to be refunded, the proper City officials are authorized and directed to execute an Escrow Agreement with respect to the proceeds of the Bonds. The City Comptroller is hereby authorized and directed to select an Escrow Agent and a Verification Accountant with respect to the proceeds of the Bonds and the deposit of securities purchased by the City of Milwaukee. The deposit of the proceeds of the Bonds into the Escrow Account to be established with the Escrow Agent is hereby authorized and directed to be accomplished immediately upon receipt of payment for the Bonds at the closing thereof, and the subsequent use, investment and disbursement thereof by the Escrow Agent in the manner provided in the Escrow Agreement is hereby authorized and approved; and, be it
Further Resolved, That the City further directs the Escrow Agent to give notice of redemption for each Refunded Bond to be redeemed by mail, postage prepaid, not less than 30 days prior to the date fixed for redemption, to any registered owner of a Refunded Bond being redeemed as of a record date 45 days prior to the redemption date, and otherwise as may be required by any agreement with a securities depository therefor. Such election to redeem and direction to the Escrow Agent shall be irrevocable upon issuance of the Refunding Bonds; and, be it
Further Resolved, That the Refunding Bonds shall be in a form approved by the City Attorney and the Commissioners of the Public Debt and shall be signed by those officers whose signatures are required by law, and shall be a general obligation of the City; and, be it
Further Resolved, That a global certificate shall be issued for each stated maturity of the Bonds and registered only in the name of Cede & Co. as nominee of The Depository Trust Company, New York, New York, for delivery and immobilization by The Depository Trust Company following the closing. The Depository Trust Company will act as securities depository for the Bonds. The City will make payment of principal, redemption premium, if any, and interest on the Bonds on the dates set forth herein to The Depository Trust Company, or its nominee, as registered owner of the Bonds, in same-day funds. Notices, if any, given by the City to the registered owner of the Bonds will be given to The Depository Trust Company. In the event that the securities depository relationship with The Depository Trust Company for the Bonds is terminated and the City does not appoint a successor securities depository, the City will prepare, authenticate and deliver at its expense fully-registered certificated Bonds, in the denominations of $5,000 or any integral multiple thereof, in the aggregate principal amount by maturity then outstanding, as directed by the registered owner of the Bonds; and, be it
Further Resolved, That the City covenants to take all actions necessary to preserve the exclusion of interest on the Refunding Bonds from gross income for federal income tax purposes. For such purpose, the City shall comply with the requirements of Sections 103 and 141 through 150 of the Internal Revenue Code of 1986 as amended and the regulations of the Internal Revenue Service adopted thereunder or otherwise applicable thereto. No use of the proceeds of the sale of the Bonds shall be made which, if such use had been reasonably expected on the date of issue of the Bonds would have caused such Bonds to be "arbitrage bonds" as defined in Subsection (d)(2) of Section 103 and Section 148 of the U.S. Internal Revenue Code of 1986. The provisions of this section shall be a covenant with the owners of the Bonds; and, be it
Further Resolved, That the City Comptroller is authorized and directed to (i) transfer the balance in the Debt Service Fund account for the Refunded Bonds being refunded to the Escrow Account for the Bonds and apply same to pay the debt service on the Bonds and (ii) to apply any such balance not needed to pay debt service on the Bonds to the Escrow Account to pay a portion of the costs of issuance of the Bonds; and, be it
Further Resolved, That the cost of issuing the Bonds, including the costs of the escrow and verification, and marketing same shall be deducted and paid from the proceeds of the Bond sale; and, be it
Further Resolved, That the Continuing Disclosure Certificate, in substantially the form of the Supplemental Certificate authorized by File Number 031384 adopted on February 10, 2004, is authorized to be executed and delivered by the Comptroller for the notes; 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 City hereby authorizes and directs the appropriate officers and employees of the City to take all action necessary or appropriate to the issuance, sale and delivery of the Bonds and 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 this resolution, failure of the City to perform in accordance with the Continuing Disclosure Certificate shall not constitute a default under this resolution and the Continuing Disclosure Certificate may be enforced only as provided therein.
Requestor
Comptroller
Drafter
RSL
PD-6937aW.doc