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Ordinance No. 2,88700508 -1 ORDINANCE NO. 2887 ORDINANCE AUTHORIZING ISSUANCE OF $1,100,000 CITY OF BAYTOWN, TEXAS, WATERWORKS AND SANITARY SEWER SYSTEM CERTIFICATES OF OBLIGATION, SERIES 1980; AND CONTAINING OTHER PROVISIONS RELATING TO THE SUBJECT THE STATE OF TEXAS § COUNTIES OF HARRIS AND CHAMBERS CITY OF BAYTOWN WHEREAS, the City Council of the CITY OF BAYTOWN, TEXAS (the "City "), authorized the publication of a notice of inten- tion to issue certificates of obligation to the effect that the City Council will adopt an ordinance authorizing the issu- ance of certificates of obligation, payable from City ad valorem taxes and revenues of the sanitary sewer system of the City, for the purpose of evidencing the indebtedness of the City for all or any part of the cost of extending and improving (1) the sanitary sewer system of the City (a maximum principal amount of $1,000,000 of Certificates of Obligation to be issued for this purpose) and (2) the waterworks system of the City (a maximum principal amount of $100,000 of Certificates of Obliga- tion to be issued for this purpose), respectively, and the cost of professional services incurred in connection therewith; and WHEREAS, such notice was published at the times and in the manner required by the Constitutions and laws of the State of Texas and of the United States of America, respectively, particularly Article 2368a.1, Vernon's Texas Civil Statutes, as amended; therefore BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN: Section 1. The facts and recitations contained in the preamble of this ordinance are hereby found and declared to be true and correct. Section 2. The City's negotiable certificates of obliga- tion, to be designated CITY OF BAYTOWN, TEXAS, WATERWORKS AND SANITARY SEWER SYSTEM CERTIFICATES OF OBLIGATION, SERIES 1980 (hereinafter called the "Certificates "), are hereby authorized to be issued and delivered in the principal amount of $1,100,000 00508 -1a for the purpose of providing $1,000,000 for extending and im- proving the sanitary sewer system of the City, including the cost of professional services incurred in connection therewith, and $100,000 for extending and improving the waterworks system of the City, including the cost of professional services in- curred in connection therewith. Section 3. The Certificates shall be dated June 1, 1980, shall be numbered consecutively from 1 through 220, shall be in the denomination of $5,000 each, and shall mature serially on February 1 of each of the years, and in the amounts, re- spectively, set forth in the following schedule: YEAR CERTIFICATE NOS. AMOUNT 1982 1 -20 $100,000 1983 21 -40 100,000 1984 41 -60 100,000 1985 61 -80 100,000 1986 81 -100 100,000 1987 101 -120 100,000 1988 121 -140 100,000 1989 141 -160 100,000 1990 161 -180 100,000 1991 181 -200 100,000 1992 201 -220 100,000 Section 4. Certificates Nos. 201 to 220, both inclusive, shall bear interest from their date to maturity or redemption at the rate of 6.5 % per annum, evidenced by interest coupons which shall appertain to the Certificates and which shall be payable on the dates indicated in the FORM OF CERTIFICATE set forth in this ordinance; Certificates Nos. 1 to 200, both in- clusive, shall bear interest at a rate, or rates, to be autho- rized by a subsequent ordinance, or ordinances, to be adopted by the City Council, Section 5. The Certificates, and the interest coupons ap- pertaining thereto, shall be payable, shall have the character- istics, and shall be signed and executed (and the Certificates shall be sealed), all as provided and in the manner indicated in the FORM OF CERTIFICATE set forth in this ordinance. -2- 00508 -1b Section 6. The form of the Certificates, including the form of registration certificate of the Comptroller of Public Accounts of the State of Texas to be printed and.endorsed on each of the Certificates, and the form of the aforesaid inter- est coupons which shall appertain and be attached initially to each of the Certificates, shall be, respectively, substan- tially as follows: FORM OF CERTIFICATE: NO. $5,000 UNITED STATES OF AMERICA STATE OF TEXAS COUNTIES OF HARRIS AND CHAMBERS CITY OF BAYTOWN, TEXAS, WATERWORKS AND SANITARY SEWER SYSTEM CERTIFICATE OF OBLIGATION SERIES 1980 ON FEBRUARY 1, 19 , the CITY OF BAYTOWN (the "City "), in the Counties of Harris and Chambers, in the State of Texas, promises to pay to bearer the principal amount of FIVE THOUSAND DOLLARS and to pay interest thereon, from the date hereof, at the rate of % per annum, evidenced by interest coupons payable February 1, 1981, and semiannually thereafter on each August 1 and February 1 while this Certificate is outstanding. The principal of this Certificate and the interest coupons apper- taining hereto shall be payable to bearer, in lawful money of the United States of America, without exchange or collection charges to the bearer, upon presentation and surrender of this Certificate or proper interest coupon at , , Texas, which shall be the paying agent for this series of Certificates. THIS CERTIFICATE is one of a series of negotiable, coupon certificates, dated June 1, 1980, numbered consecutively from 1 through 220, in the denomination of $5,000 each, aggregating $1,100,000, issued in accordance with the Constitution and laws -3- 00508 -1c of the State of Texas, particularly Article 2368a.1, Vernon's Texas Civil Statutes, as amended, for the purpose of providing $1,000,000 for extending and improving the sanitary sewer system of the City, including the cost of professional services in- curred in connection therewith, and $100,000 for extending and improving the waterworks system of the City, including the cost of professional services incurred in connection therewith, and pursuant to an ordinance (the "Ordinance ") duly adopted by the City Council of the City, which Ordinance is of record in the official minutes of the City Council. IT IS HEREBY certified, recited, and covenanted that this Certificate has been duly and validly authorized, issued, and delivered; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the issuance and delivery of this Certificate, have been per- formed, existed, and been done in accordance with law; that annual ad valorem taxes sufficient to provide for the payment of the interest on and principal of this Certificate, as such interest comes due and such principal matures, have been levied and ordered to be levied against all taxable property in the City and have been pledged for such payment within the limits prescribed by law; that this Certificate shall be a debt of the City within the meaning of Article XI, Sections 5 and 7 of the Constitution of Texas; and that, when delivered, this Certifi- cate shall be deemed and construed (i) to be a "Security" within the meaning of Chapter 8, Investment Securities, Uniform Commercial Code (Chapter 785, Acts of the 60th Legislature, Regular Session, 1967), and (ii) to be an obligation of the City within the meaning of Chapter 784, Acts of the 61st Legislature of Texas, Regular Session, 1969. IT IS FURTHER CERTIFIED, RECITED AND REPRESENTED that the revenues to be derived from the operation of the sanitary sewer system of the City, after the payment of all operation -4- 00508 -Zd and maintenance expenses of said system, are also pledged to the payment of the principal of and interest on this Certifi- cate and the series of Certificates of which it is a part to the extent that said taxes levied and collected for same may ever be insufficient or unavailable for said purpose, the said pledge of revenues being in all things junior and subordinate to the existing pledge of and lien on said revenues for the payment of the interest on and principal of all.of the out- standing water, sewer and gas system revenue bonds of the City, all as set forth in the Ordinance. THE CITY HAS RESERVED THE RIGHT TO ISSUE ADDITIONAL PARITY CERTIFICATES, and said certificates may be payable from the same source, secured in the same manner and placed on a parity with this Certificate and the series of which it is a part, all as set forth in the Ordinance. IN WITNESS WHEREOF, this Certificate of Obligation and the interest coupons appertaining hereto have been signed with the facsimile signature of the Mayor and countersigned with the facsimile signature of the City Clerk of the City, respec- tively, and the official seal of the City has been duly im- pressed, or placed in facsimile, on this Certificate. COUNTERSIGNED: xxxxxxxxxx City Clerk CITY OF BAYTOWN, TEXAS (SEAL) xxxxxxxxxx Mayor CITY OF BAYTOWN, TEXAS FORM OF REGISTRATION CERTIFICATE: COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. I hereby certify that this Certificate of Obligation has been examined, certified as to validity, and approved by the Attorney General of the State of Texas, and that this Certifi- cate of Obligation has been registered by the Comptroller of Public Accounts of the State of Texas. -5- 00548 -fie WITNESS my signature and seal this xxxxxxxxxx (SEAL) Comptroller of Public Accounts of the State of Texas NO. FORM OF INTEREST COUPON: ON 1, 19 , the CITY OF BAYTOWN, in the Counties of Harris and Chambers, State of Texas, promises to pay to bearer the amount shown on this interest coupon, in lawful money of the United States of America, without exchange or collection charges to the bearer, upon presentation and surrender of this interest coupon, at 1 f Texas, said amount being interest due that day on the Certifi- cate of Obligation bearing the number hereinafter designated of that issue of CITY OF BAYTOWN, TEXAS, WATERWORKS AND SANI- TARY SEWER SYSTEM CERTIFICATES OF OBLIGATION, SERIES 1980, dated June 1, 1980. Certificate No. xxxxxxxxxx City Clerk xxxxxxxxxx Mayor Section 7. A special fund or account, to be designated the "City of Baytown, Texas, Waterworks and Sanitary Sewer System Certificates of Obligation, Series 1980, Interest and Sinking Fund" (hereinafter called the "Interest and Sinking Fund "), is hereby created and shall be established and main- tained by the City at an official depository bank of the City. The Interest and Sinking Fund shall be kept separate and apart from all other funds and accounts of the City and shall be used only for paying the interest on and principal of the Cer- tificates. All ad valorem taxes levied and collected for and on account of the Certificates shall be deposited, as collected, to the credit of the Interest and Sinking Fund. During each year while any of the Certificates or interest coupons apper- taining thereto are outstanding and unpaid, the City Council 00508-If of the City shall compute and ascertain a rate and amount of ad valorem tax which will be sufficient to raise and produce the money required to pay the interest on the Certificates as such interest comes due and to provide and maintain a sinking fund adequate to pay the principal of the Certificates as such principal matures but never less than 2% of the original prin- cipal amount of the Certificates as a sinking fund each year; and said tax shall be based on the latest approved tax rolls of the City, with full allowance being made for tax delinquen- cies and the cost of tax collection. Said rate and amount of ad valorem tax are hereby levied, and are hereby ordered to be levied, against all taxable property in the City for each year while any of the Certificates or interest coupons appertaining thereto are outstanding and unpaid; and said tax shall be assessed and collected each such year and deposited to the credit of the Interest and Sinking Fund. Said ad valorem taxes sufficient to provide for the payment of the interest on and principal of the Certificates, as such interest comes due and such principal matures, are hereby pledged for such payment within the limits prescribed by law. Section S. The revenues to be derived from the operation of the sanitary sewer system of the City, after the payment of all operation and maintenance expenses of said system, are hereby pledged to the payment of the principal of and interest on the Certificates as the same come due to the extent that the taxes mentioned in Section 7 of this ordinance may ever be insufficient or unavailable for said purpose, provided that this pledge of said revenues is and shall be in all things junior and subordinate to the existing pledge of and lien on said revenues for the payment of the interest on and principal of all of the outstanding waterworks and sanitary sewer system revenue bonds of the City. -7- 00508 -1g Section 9. Immediately following delivery of the Cer- tificates to the purchaser thereof the accrued interest shall be deposited in the Interest and Sinking Fund. Section 10. The City certifies that based upon all facts and estimates now known or reasonably expected to be in exis- tence on the date the Certificates are delivered and paid for, the City reasonably expects that the proceeds of the Certifi- cates will not be used in a manner that would cause the Certifi- cates or any portion of the Certificates to be an "arbitrage certificate" under Section 103(c)(2) of the Internal Revenue Code of 1954, as amended, and the regulations prescribed there- under. Furthermore, all officers, employees and agents of the City are authorized and directed to provide certifications of facts and estimates that are material to the reasonable expecta- tions of the City as of the date the Certificates are delivered and paid for. In particular, all or any officers of the City are authorized to certify for the City the facts and circumstances and reasonable expectations of the City on the date the Cer- tificates are delivered and paid for regarding the amount and use of the proceeds of the Certificates. Moreover, the City covenants that it shall make such use of the proceeds of the Certificates, regulate investments of proceeds of the Certifi- cates and take such other and further actions as may be required so that the Certificates shall not be "arbitrage certificates" under Section 103(c)(2) of the Internal Revenue Code of 1954, as amended, and the regulations prescribed from time to time thereunder. Section 11. The Mayor of the City is hereby authorized to have control of the Certificates and all necessary records and proceedings pertaining to the Certificates pending their delivery and their investigation, examination, and approval by the Attorney General of the State of Texas and their registra- tion by the Comptroller of Public Accounts of the State of 00508 -1h Texas. Upon registration of the Certificates, the Comptroller of Public Accounts (or a deputy designated in writing to act for the Comptroller) shall manually sign the Comptroller's Registration Certificate prescribed herein to be printed and endorsed on each Certificate; and the seal of the Comptroller shall be impressed, or placed in facsimile, on each of the Certificates. Section 12. Certificates Pros. 201 to 220, both inclusive, are hereby sold and shall be delivered to Underwood Neuhaus & Company, Inc. for the par value thereof and accrued interest thereon to date of delivery, sub- ject to the unqualified approving opinions, as to the legality of the Certificates, of the Attorney General of the State of Texas and of Vinson & Elkins, Houston, Texas, market attorneys; and it is hereby officially found, determined, and declared that the Certificates are sold on the best terms and for the best price possible. Certificates Nos. 1 to 200, both inclu- sive, shall be sold pursuant to an ordinance, or ordinances, to be adopted by the City Council. Section 13. The Mayor and all other appropriate officers of the City are hereby authorized and directed to do any and all things necessary or convenient to carry out the provisions of this ordinance. Section 14. This ordinance shall take effect immediately upon its passage. Section 15. It is hereby officially found and determined that the need of the City for such financing creates an emer- gency and an urgent public necessity for the holding, at the scheduled time, of the meeting of the City Council at which this ordinance is adopted and for the adoption of this ordi- nance; and the NOTICE OF MEETING relating to said meeting and heretofore posted by the City Clerk, and the posting thereof, is hereby authorized, approved, adopted and ratified. PASSED AND APPROVED this 8th day of May, 1980. ATTEST_ '-Mayor CITY OF BAYTOWN, TEXAS City Clerk CITY OF BAYTOWN, TEXAS (SEAL) -10- 00508 -1i