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19930309 1993-121993-12 ORDINANCE NO. 1993-12 AN ORDINANCE AUTHORIZING THE ISSUANCE OF NOT TO EXCEED $550,000 GENERAL OBLIGATION SCHOOL BONDS OF THE CITY OF FAIRFAX, VIRGINIA, 1993, SERIES A, TO BE SOLD TO THE VIRGINIA PUBLIC SCHOOL AUTHORITY AND PROVIDING FOR THE FORM AND DETAILS THEREOF. WHEREAS, the City Council (the "city Council") of the city of Fairfax, Virginia (the "city"), has determined that it is necessity and expedient to borrow not to exceed $550,000, and to issue its general obligation school bonds for the purpose of financing certain capital projects for school purposes; WHEREAS, the city held a public hearing, duly noticed, on March 9, 1993, on the issuance of the Bonds (as defined below) in accordance with the requirements of Section 15.1-227.8(A), Code of Virginia 1950, as amended (the "Virginia Code"); and WHEREAS, by resolution the School Board of the City of Fairfax, Virginia (the "School Board"), has requested the city Council to take all necessary action to consummate the sale of the Bonds and has consented to the issuance of the Bonds; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAIRFAX, VIRGINIA: 1. Authorization of Bonds and Use of Proceeds. The city Council determines that it is advisable to contract a debt and issue and sell its general obligation school bonds in an aggregate principal amount not to exceed $550,000 (the "Bonds") for the purpose of financing certain capital projects for school purposes. The City Council authorizes the issuance and sale of the Bonds in the form and upon the terms established pursuant to this Ordinance. The Bonds shall be issued solely pursuant to the Public Finance Act of 1991, Section 15.1-227.1 of the Code of Virginia of 1950, as amended. 2. Sale of the Bonds. It is determined to be in the best interest of the City to accept the offer of the Virginia Public School Authority (the "VPSA") to purchase from the City, and to sell to the VPSA, the Bonds at par upon the terms established pursuant to this Ordinance. The Mayor, the City's Director of Finance or such officer or officers of the City as either may designate are authorized and directed to enter into a Bond Sale Agreement anticipated to be dated March 23, 1993, with the VPSA providing for the sale of the Bonds to the VPSA in substantially the form submitted to the City Council at this meeting, which form is approved (the "Bond Sale Agreement"). 3. Details of the Bonds. The Bonds shall be issuable in registered form in denominations of $5,000 and whole multiplies thereof; shall be dated the date of issuance and delivery of the Bonds; shall be designated "General Obligation School Bonds, 1993 Series A;" shall bear interest from the date of delivery thereof payable semi-annually on each June 15 and December 15 beginning December 15, 1993 (each an "Interest Payment Date"), at the rates established in accordance with Section 4 of this Ordinance; and shall mature on December 15 in the years (each a "Principal Payment Date") and in the amounts set forth on Schedule I attached to Appendix A attached hereto (the "Principal Installments"), subject to the provisions of paragraph 4 of this Ordinance. 4. Interest Rates and Principal Installments. The Director of Finance is authorized and directed to accept the interest rates on the Bonds established by the VPSA, provided that each interest rate shall be ten one-hundredths of one percent (0.10%) over the annual rate to be paid by the VPSA for the corresponding principal payment date of the bonds to be 1993-12 -2- issued by the VPSA (the "VPSA Bonds"), a portion of the proceeds of which will be used to purchase the Bonds, and provided further, that no interest rate on the Bonds shall exceed nine percent (9%) per year. The Interest Payment Dates and the Principal Installments are subject to change at the request of the VPSA. The Director of Finance is authorized and directed to accept changes in the Interest Payment Dates and the Principal Installments at the request of the VPSA, provided that the aggregate principal amount of the Bonds shall not exceed the amount authorized by this Ordinance. The execution and delivery of the Bonds as described in Section $ hereof shall conclusively evidence such interest rate or rates established by the VPSA and the Interest Payment Dates and the Principal Installments requested by the VPSA as having been so accepted as authorized by this Ordinance. Following the sale of the Bonds, the Director of Finance shall file a certificate with the City Clerk setting forth the final terms and purchase price of the Bonds. 5. Form of the Bonds. For as long as the VPSA is the registered owner of the Bonds, the Bonds shall be in the form of a single, temporary typewritten bond substantially in the form attached hereto as Exhibit A. On twenty (20) days written notice from the VPSA, the city shall deliver, at its expense, the Bonds in marketable form in denominations of $5,000 and whole multiples thereof, as requested by the VPSA, in exchange for the temporary typewritten Bond. 6. Payment; Payinq Aqent and Bond Reqistrar. following provisions shall apply to the Bonds: The a. For as long as the VPSA is the registered owner of the Bonds, all payments of principal of, premium, if any, and interest on the Bonds shall be made in immediately available funds to the VPSA at or before 11:00 a.m. (Richmond, Virginia, time) on the applicable Interest Payment Date, Principal Payment Date or date fixed for prepayment or redemption, or if such date is not a business day for Virginia banks or for the Commonwealth of Virginia, then at or before 11:00 a.m. (Richmond, Virginia, time) on the business day next preceding such Interest Payment Date, Principal Payment Date or date fixed for prepayment or redemption. b. Ail overdue payments of principal or interest, to the extent permitted by law, shall bear interest at the applicable interest rate or rates on the Bonds. c. Signet Trust Company, Richmond, Virginia, is designat- ed as Bond Registrar and Paying Agent for the Bonds. 7. Prepayment or Redemption. The Principal Installments of the Bonds held by the VPSA coming due on or before December 15, 2002, and the definitive Bonds for which the Bonds held by the VPSA may be exchanged that mature on or before December 15, 2002, are not subject to prepayment or redemption prior to their stated maturities. The principal installments of the Bonds held by the VPSA coming due after December 51, 2002, and the definitive Bonds for which the Bonds held by the VPSA may be exchanged that mature after December 15, 2002, are subject to prepayment or redemption at the City's option prior to their stated maturities in whole or in part, on any date on or after December 15, 2002, upon payment of the prepayment or redemption prices (expressed as percentages of principal installments to be prepaid or the principal amount of the Bonds to be redeemed) set forth below plus accrued interest to the date set for prepayment or redemption: 1993-12 -3- Dates Prices December 15, 2002 to December 14, 2003, inclusive 103% December 15, 2003 to December 14, 2004, inclusive 102 December 15, 2004 to December 14, 2005, inclusive 101 December 15, 2005 and thereafter 100 Provided, however, that while the VPSA is the registered owner of the Bonds, the Bonds shall not be subject to prepayment or redemption prior to their stated maturities as described above without first obtaining the written consent of the VPSA. Notice of any such prepayment or redemption shall be given by the Registrar to the registered owner by registered mail not more than ninety (90) and not less than thirty (30) days before the date fixed for prepayment or redemption. 8. Execution of the Bonds. The Bonds shall be signed by the Mayor or Vice-Mayor of the city, and the city's seal shall be affixed thereon and attested by the city Clerk or by any of its Deputy Clerks. 9. Pledqe of Full Faith and Credit. For the prompt payment of the principal of, the premium, if any, and the interest on the Bonds as the same shall become due, the full faith and credit of the City are irrevocably pledged, and in each year while any of the Bonds shall be outstanding there shall be levied and collected in accordance with law an annual ad valorem tax upon all taxable property in the City subject to local taxation sufficient in amount to provide for the payment of the principal of, the premium, if any, and the interest on the Bonds as such principal, premium, if any, and interest shall become due, which tax shall be without limitation as to rate or amount and in addition to all other taxes authorized to be levied in the City to the extent other funds of the City are not lawfully available and appropriated for such purpose. 10. Maintenance of Tax-Exemption. The city covenants that it shall not take or omit to take any action the taking or omission of which will cause the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended (the "Code"), or otherwise cause interest on the Bonds to be includable in the gross income for federal income tax purposes of the registered owners thereof under existing law. 11. Use of Proceeds Certificate. The City Manager, the City Treasurer, or such officer of officers of the City as either may designate are authorized and directed to execute a Certificate as to Arbitrage and a Use of Proceeds Certificate each setting forth the expected use and investment of the proceeds of the Bonds and containing such covenants as may be necessary in order to show compliance with the provisions of the Code, and applicable regulations relating to the exclusion from gross income of interest on the Bonds and on the VPSA Bonds. The City covenants that (a) the proceeds from the issuance and sale of the Bonds will be invested and expended as set forth in such Certificate as to Arbitrage and such Use of Proceeds Certificate and that the City shall comply with the other covenants and representations contained therein and (b) that the City shall comply with the provisions of the Code so that interest on the bonds and on the VPSA Bonds will remain excludable from gross income for Federal income tax purposes. Such Certificates may also provide for any elections such officers deem desirable regarding rebate of earnings to the United States for purposes of complying with the provisions of Code Section 148. 1993-12 -4- 12. Restrictions on Private Use. The city covenants that it will not permit the gross proceeds of the Bonds to be used in any manner that would result in (a) 5% or more of such proceeds being used in a trade or business carried on by any person other than a governmental unit, as provided in Code Section 141(b), (b) 5% or more of such proceeds being used with respect to any "output facility" (other than a facility for the furnishing of water), within the meaning of Code Section 141(b)(4), or (c) 5% or more of such proceeds being used directly or indirectly to make or finance loans to any persons other than a governmental unit, as provided in Code Section 141(c); provided, however, that if the City receives an opinion of bond counsel to the City with respect to the Bonds, and bond counsel to the VPSA with respect to the VPSA Bonds, that compliance with any such restriction is not required to prevent interest on the bonds of both issues from being includable in the gross income for federal income tax purposes of the registered owners thereof under existing law, the City need not comply with such restriction. 13. State Non-Arbitrage Program: Proceeds Agreement. The city Council determines that it is in the best interests of the City to authorize and direct the city Treasurer to participate in the State Non-Arbitrage Program in connection with the Bonds. The Mayor, the city Manager or such officer or officers of the City as either may designate are authorized and directed to execute and deliver a Proceeds Agreement with respect to the deposit and investment of proceeds of the Bonds by and among the City, the other participants in the sale of the VPSA Bonds, the VPSA, Public Financial Management, Inc., as investment manager, and Central Fidelity Bank, as depository, substantially in the form submitted to the City Council at this meeting, which form is approved. 14. Filing of Ordinance. The appropriate officers or agents of the city are authorized and directed to cause a certified copy of this Ordinance to be filed with the Circuit Court of Fairfax County. 15. Further Actions. The members of the City Council and all officers, employees and agents of the City are authorized to take such action as they or any one of them may consider necessary or desirable in connection with the issuance and sale of the Bonds and any such action previously taken is ratified and confirmed. 16. Effective date. This ordinance shall take effect upon signature by the Mayor. INTRODUCED: March 9, 1993 PUBLIC HEARING: March 9, 1993 ADOPTED: March 9, 1993 ~~Mayo~ ATTEST: ~erk 1993-12 -5 EXHIBIT A (FORM OF TEMPORARY BOND) NO. TR-1 $550,000 UNITED STATES OF ]~ERICA CO~[ONWEALTH OF VIRGINIA CITY OF FAIRFAX, VIRGINIA General Obligation School Bond X993 Series THE CITY OF FAIRFAX, VIRGINIA (the "city"), for value received, acknowledges itself indebted and promises to pay to the VIRGINIA PUBLIC SCHOOL AUTHORITY the principal amount of FIVE HUNDRED FIFTY THOUSAND DOLLARS ($550,000), in annual installments in the amounts set forth on Schedule I attached hereto payable on December 15, 1993, and annually on December 15 thereafter to and including December 15, 2002 (each a "Principal Payment Date"), together with interest from the date of this Bond on the unpaid installments, payable semi-annually on June 15 and December 15 of each year, commencing on December 15, 1993 (each an "Interest Payment Date"; together with any Principal Payment Date, a "Payment Date"), at the rates per year set forth on Schedule I attached hereto, subject to prepayment or redemption as hereinafter provided. Both principal of and interest on this Bond are payable in lawful money of the United States of America. For as long as the Virginia Public School Authority is the registered owner of this Bond, Signet Trust Company, Richmond, Virginia, as bond registrar (the "Bond Registrar"), shall make all payments of principal of, premium, if any, and interest on this Bond, without the presentation or surrender hereof, to the Virginia Public School Authority, in immediately available funds at or before 11:00 a.m. (Richmond, Virginia, time) on the applicable Payment Date or date fixed for prepayment or redemption. If a Payment Date or date fixed for prepayment or redemption is not a business day for banks in the Commonwealth of Virginia or for the Commonwealth of Virginia, then the payment of principal of or premium, if any, or interest on this Bond shall be made in immediately available funds at or before 11:00 a.m. (Richmond, Virginia, time) on the business day next preceding the Scheduled Payment Date or date fixed for prepay- ment or redemption. Upon receipt by the registered owner of this Bond of said payments of principal, premium, if any, and interest, written acknowledgment of the receipt thereof shall be given promptly to the Bond Registrar, and the City shall be fully discharged of its obligation on this Bond to the extent of the payment so made. Upon final payment, this Bond shall be surrendered to the Bond Registrar for cancellation. The full faith and credit of the City are irrevocably pledged for the payment of principal of and premium, if any, and interest on this Bond. The ordinance adopted by the City Council authorizing the issuance of this Bond provides, and Section 15.1-227.25 of the Code of Virginia of 1950, as amended, requires, that there shall be levied and collected an annual tax upon all taxable property in the City subject to local taxation sufficient to provide for the payment of the principal of and premium, if any, and interest on this Bond as the same shall 1993-12 -6 -2- become due which tax shall be without limitation as to rate or amount and shall be in addition to all other taxes authorized to be levied in the City to the extent other funds of the City are not lawfully available and appropriated for such purpose. This Bond is duly authorized and issued in compliance with and pursuant to the Constitution and laws of the Commonwealth of Virginia, including the Public Finance Act of 1991, Chapter 5.1, Title 15.1, Code of Virginia 1950, as amended, an ordinance duly adopted by the City Council and a resolution adopted by the School Board of the City to provide funds for capital projects for school purposes. This Bond may be exchanged without cost at the office of the Bond Registrar for an equal aggregate principal amount of Bonds in definitive form having maturities and bearing interest at rates corresponding to the maturities of and the interest rates on the installments of principal of this Bond then unpaid, issuable in fully registered form in denominations of $5,000 and whole multiples thereof. This Bond is registered in the name of Virginia Public School Authority on books of the City kept by the Bond Regi- strar, and the transfer of this Bond may be effected by the registered owner of this Bond only upon due execution of an assignment by such registered owner. Upon receipt of such assignment and the surrender of this Bond, the Bond Registrar shall exchange this Bond for definitive Bonds as hereinabove provided, such definitive Bonds to be registered on such registration books in the name of the assignee or assignees named in such assignment. The principal installments of this bond coming due on or before December 15, 2002, and the definitive Bonds for which this Bond may be exchanged that mature on or before December 15, 2002, are not subject to prepayment or redemption prior to their stated maturities. The principal installments of this Bond coming due after December 15, 2002, and the definitive Bonds for which this Bond may be exchanged that mature after December 15, 2002, are subject to prepayment or redemption at the City's option prior to their stated maturities in whole or in part, on any date on or after December 15, 2002, upon payment of the prepayment or redemption prices (expressed as percentages of principal installments to be prepaid or the principal amount of the Bonds to be redeemed) set forth below plus accrued interest to the date set for prepayment or redemption: Dates Prices December 15, 2002 to December 14, 2003, inclusive December 15, 2003 to December 14, 2004, inclusive December 15, 2004 to December 14, 2005, inclusive December 15, 2005, and thereafter 103% 102 101 100 Provided, however, that while the Virginia Public School Authority is the registered owner of this Bond or of the definitive Bonds for which this Bond may be exchanged, the Bonds shall not be subject to prepayment or redemption prior to their stated maturities as described above, without first obtaining the written consent of the Virginia Public School Authority. Notice of any such prepayment or redemption shall be given by the Bond Registrar to the registered owner by registered mail not more than 90 and not less than 60 days before the date fixed for prepayment or redemption. 1993-12 -7 -3- All acts, conditions and things required by the Constitu- tion and laws of the Commonwealth of Virginia to happen, exist or be performed precedent to and in the issuance of this Bond have happened, exist and have been performed in due time, form and manner as so required, and this Bond, together with all other indebtedness of the City, is within every debt and other limit prescribed by the Constitution and laws of the Common- wealth of Virginia. IN WITNESS WHEREOF, the city of Fairfax, Virginia, has caused this Bond to be issued in the name of the City of Fairfax, Virginia, to be signed by its Mayor, its seal to be affixed hereto and attested by its Clerk, and this Bond to be dated April 29, 1993. ATTESTs City Clerk, City of Fairfax, Virginia (SEAL) Mayor, City of Fairfax, Virginia 1993-12 -8 SCHEDULE CITY OF FAXRFAX, VIRGINIA $550v000 GENERAL OBLIGATION SCHOOL BONDv 1993~ 8ERIE8 A Year Mount 1993 $55,000 1994 55,000 1995 55,000 1996 55,000 1997 55,000 1998 55,000 1999 55,000 2000 55,000 2001 55,000 2002 55,000