19690204 r-69-4 R-69-4
RESOLUTION
of the
CITY COUNCIL OF THE CITY OF FAIRFAX, VIRGINIA
WHEREAS, the Washington Metropolitan Area Transit
Authority Compact imposes a six per cent interest rate limita-
tion on bonds issued by the Authority; and
WHEREAS, there has been a significant increase in
interest rates since the Compact was enacted; and
WHEREAS, the plan for financing the Regional Transit
System contemplates a Federal contribution of two-thirds of the
net project cost; and
WHEREAS, the Executive Branch of the Federal govern-
ment has agreed to support such a two-thirds contribution in
the form of an underwriting arrangement whereby the Authority
would issue "Federal Share Bonds" in an amount equivalent to the
two-thirds Federal contribution (approximately 1.1 billion) with
the Federal government making periodic contributions to meet
the debt service on such "Federal Share Bonds"; and
WHEREAS, the Authority's construction schedule requires
that the first issuance of such "Federal Share Bonds" be marketed
in the late summer or early fall of 1969; and
WHEREAS, under present and foreseeable conditions of
the money markets the interest on such bonds would most probably
be in excess of six per cent; and
WHEREAS, the next regular session of the Virginia
General Assembly will not convene until 1970; and
WHEREAS, a special session of the Virginia General
Assembly is expected to be called in February, 1969; and
WHEREAS, delay in effectuating the necessary Compact
amendments to relieve the Authority from the six per cent interest
rate limitation with respect to "Federal Share Bonds" would
be extremely costly--it has been estimated that one year's de-
lay would escalate the cost of the adopted Regional Transit
System by approximately $90,000,000:
NOW, THEREFORE, BE IT RESOLVED, that the City Council
of the City of Fairfax, Virginia does hereby respectfully request
the Governor to place on the agenda of the forthcoming special
session of the Virginia General Assembly legislation amending
the Washington Metropolitan Area Transit Authority Compact to
eliminate the six per cent interest rate limitation with respect
to "Federal Share Bonds" of the Authority; and
BE IT FURTHER RESOLVED, that the City Manager of the
City of Fairfax, Virginia is directed to immediately dispatch a
certified copy of this resolution to the Governor of the Common-
wealth of Virginia.
ADOPTED: February 4, 1969.
Attest:
City Clerk
· / VV~ay°r