CITY OF TEXARKANA, AR

REQUEST FOR BOARD ACTION

 

AGENDA TITLE: Consider the following concerning Franchise Fee Revenue Refunding Bonds, Series 2015:

·         Conduct a public hearing.

·         Adopt a Ordinance to confirm the aggregate principal amount, maturity and interest rate schedules, and redemption features of the City of Texarkana, Arkansas Franchise Fee Secured Refunding Revenue Bonds, Series 2015, Authorized by Resolution No. 6294. (FIN)

·         This ordinance requires an emergency clause: An emergency clause requires a separate and distinct vote of the board and is valid only if there is a two-thirds vote of approval by the board. (Hdbk. Const. Amend 7)

DEPARTMENT: Finance

DATE SUBMITTED: 07/14/2015

PREPARED BY: TyRhonda Henderson

SUBJECT: Franchise Fee Secured Refunding Revenue Bonds, Series 2015

EXHIBITS:  Ordinance, Resolution No. 6294, Bond Purchase Agreement Draft, Trust Indenture Draft, Conditional Notice of Full Redemption, and Preliminary Official Statement.

APPROVAL:

 

 

EXPENSE REQUIRED: $0.00

AMOUNT BUDGETED: $0.00

APPROPRIATION REQUIRED: $0.00

SUMMARY: This item is to confirm certain aspects related to the issuance of the Bonds, including the aggregate principal amount, maturity and interest rates schedules, and redemption features. The adoption of Resolution 6294 authorized the issuance of these bonds.

BOARD ACTION: The Acting City Manager and staff recommend that the City Board of Directors approve this resolution.

 

 

 

ORDINANCE NO. ____

 

AN ORDINANCE AUTHORIZING THE ISSUANCE OF $3,770,000 FRANCHISE FEE SECURED REFUNDING REVENUE BONDS, SERIES 2015; AUTHORIZING A TRUST INDENTURE SECURING THE BONDS; AUTHORIZING THE SALE OF THE BONDS AND THE EXECUTION OF A BOND PURCHASE AGREEMENT; PRESCRIBING OTHER MATTERS PERTAINING THERETO; AND DECLARING AN EMERGENCY.

 

WHEREAS, pursuant to the Constitution and laws of the State of Arkansas, including particularly the Local Government Capital Improvement Revenue Bond Act of 1985 (the “Act”), the City of Texarkana, Arkansas (the “City”) is authorized to issue bonds to refund bonds issued to finance capital improvements, and to pledge to the repayment of the bonds the franchise fees charged to public utilities for the privilege of using the City’s streets and rights-of-way; and

WHEREAS, the City has previously issued its Franchise Fee Secured Capital Improvement Revenue Bonds, Series 2010 (the “Prior Bonds”); and

WHEREAS, to achieve debt service savings, the City has determined to issue its Franchise Fee Secured Refunding Revenue Bonds, Series 2015, dated August 1, 2015 (the “Bonds”), in the principal amount of $3,770,000; and

WHEREAS, the City intends to issue the Bonds on a parity of security with its $10,300,000 original principal amount Franchise Fee Secured Refunding Revenue Bonds, Series 2012 (the “Series 2012 Bonds”); and

WHEREAS, the City is offering, and Stephens Inc. (the “Underwriter”), is expected to agree to purchase for offering to the public, all (but not less than all) of the Bonds, pursuant to a Bond Purchase Agreement (the “Bond Purchase Agreement”), to be dated its date of execution, between the City and the Underwriter; and

WHEREAS, the following documents have been prepared in connection with the issuance of the Bonds and have been reviewed by the City and Rose Law Firm, a Professional Association, Bond Counsel: (a) a Trust Indenture, dated as of August 1, 2015, between the City and Bank of the Ozarks, as Trustee (the “Trustee”) (the“Indenture”), establishing the general provisions and details of the Bonds, establishing the funds and accounts relating to the Bonds, providing for the security and payment of the Bonds, and the rights of the owners thereof, and (b) the Bond Purchase Agreement; and

WHEREAS, there has been prepared for distribution to various prospective and actual purchasers of the Bonds a Preliminary Official Statement (the “Preliminary Official Statement”) describing the City, the Bonds, the Indenture, and other information;

NOW, THEREFORE, BE IT ORDAINED by the Board of Directors of the City of Texarkana, Arkansas, as follows:

SECTION 1. That the issuance of the Bonds in the aggregate principal amount of $3,770,000 is hereby authorized for the purpose of refunding the Prior Bonds, funding a debt service reserve, and paying the costs of issuance of the Bonds; provided, however, the sale of the Bonds shall be upon terms substantially as set forth in the Bond Purchase Agreement authorized in Section 2 satisfactory to the Mayor, and subject to the further conditions that the purchase price of the Bonds shall be not less than 99.0% of the par value thereof (not taking into account original issue discount and premium) and that all such Bonds shall mature not later than April 1, 2040, and have a true interest cost (after taking into account original issue discount and premium and Underwriter’s discount but excluding other costs of issuing the Bonds) of 3.7045% per annum.

SECTION 2. That the Indenture, the Bond Purchase Agreement, and the Preliminary Official Statement, in substantially the forms presented to the meeting at which this Ordinance is adopted, are hereby approved.

SECTION 3. That the City hereby finds and determines that the Bond Purchase Agreement, in substantially the form presented at the meeting at which this Ordinance is adopted, is fair and reasonable and in the best interests of the City; and the Bonds shall be sold and delivered to the Underwriter upon the terms and conditions set forth in the Bond Purchase Agreement and upon the basis of the representations set forth therein. Subject to the conditions of Section 1, the City hereby accepts the Bond Purchase Agreement and authorizes and directs the Mayor to complete, execute, and deliver the Bond Purchase Agreement for and in the name of the City in substantially the form presented at this meeting with such changes, additions, and substitutions therein as shall be approved by the Mayor, her execution and delivery thereof to constitute conclusive evidence of her approval of any such changes.

SECTION 4. The Mayor and City Clerk are hereby authorized and directed to execute and deliver the Indenture for and in the name of the City in substantially the form presented at the meeting at which this Ordinance is adopted, with such changes therein as shall be approved by the aforesaid authorized officers, their execution and delivery thereof to constitute conclusive evidence of their approval of any such changes. The City recognizes that certain revisions may be made to the Indenture prior to the issuance of the Bonds, and hereby authorizes the Mayor to approve and accept such revisions, the signature of the Mayor on the Indenture to constitute proof of acceptance of such revisions. Specifically, the Mayor is hereby authorized to (i) accept the final aggregate principal amount, schedule of maturities, and interest rates of the Bonds if she deems such to be appropriate and within the authority granted by this Ordinance and (ii) execute and deliver the Indenture.

SECTION 5. That the City Board of Directors authorizes and approves the production of a final Official Statement and authorizes and directs the Mayor to execute and deliver the Official Statement in connection with the issuance of the Bonds in such form as she deems acceptable.

SECTION 6. The Mayor and City Clerk, for and on behalf of the City, are hereby authorized and directed to do any and all things necessary to effect the execution and delivery of the Bonds, the Bond Purchase Agreement, and the Indenture; the execution and delivery of such other papers and documents necessary to effect the issuance of the Bonds, including particularly a Continuing Disclosure Agreement, dated as of August 1, 2015, in substantially the form attached to the Preliminary Official Statement, and the performance of all acts of whatever nature necessary to effect and carry out the authority conferred by this Ordinance. The Mayor and the City Clerk are hereby further authorized and directed, for and on behalf of the City, to execute all papers, documents, certificates, and other instruments that may be required for the carrying out of such authority or to evidence the exercise thereof.

SECTION 7. It is hereby ascertained and declared that the refunding of the Prior Bonds be accomplished as soon as possible in order to achieve debt service savings and to alleviate immediate hazards to the health, safety, and welfare of the City of Texarkana, its inhabitants, and their property; and that the refunding can be accomplished only by the issuance of the Bonds. Therefore, an emergency is hereby declared to exist and this ordinance, being necessary for the immediate preservation of the public health, safety, and welfare, shall be in full force and effect from and after its passage and approval.

PASSED AND APPROVED this July 20, 2015.

 

 

____________________________

Ruth Penney Bell, Mayor

ATTEST:

 

________________________________

Heather Soyars, City Clerk

 

APPROVED:

 

________________________________

George Matteson, City Attorney

 

PREPARED BY:

 

________________________________

James M. Fowler, Jr., Rose Law Firm,

a Professional Association, Bond Counsel

 

 

 

Back to Top            Back to Main Agenda Page