Bill No. 232                                                                                           ORDINANCE NO. 1244

                        AN ORDINANCE AMENDING ORDINANCE NO. 1120 IN CONNECTION WITH CONVERTING THE CITY’S STATE REVOLVING FUND PARTICIPATION FROM THE SRF LEVERAGED PROGRAM TO THE SRF DIRECT LOAN PROGRAM                       ______________________________________________________

 

            WHEREAS, the City of Rich Hill, Missouri (the “City”) is a fourth class city and political subdivision, organized and existing under the Constitution and laws of the State ofMissouri; and

            WHEREAS, the City operates a revenue producing combined waterworks and sewerage system serving the City and its inhabitants (the “System”); and

            WHEREAS, the City is authorized under the provisions of Chapter 250 of the Revised Statutes of Missouri (the “Act”), to issue and sell revenue bonds for the purpose of paying all or part of the cost of extending and improving the revenue producing combined waterworks and sewerage system serving the City and its inhabitants (the “System”); and

            WHEREAS, in order to provide for the most cost effective financing of certain extensions and improvements to the System the City participated in the Missouri Leveraged State Water Pollution Control Revolving Fund Program (the “SRF Leveraged Program”) of the Missouri Department of Natural Resources (“DNR”) pursuant to the Act by the issuance of the City’s Combined Waterworks and Sewerage System Revenue Bonds (State Revolving Fund – Leveraged Loan Program) Series 2001, dated February 6, 2001, in the original principal amount of $900,000 (the “Original Bonds”), authorized by Ordinance No. 1120 passed and approved on January 23, 2001 (the “Original Bond Ordinance”); and

            WHEREAS, pursuant to the SRF Leveraged Program DNR purchased the Bonds pursuant to the Purchase Agreement dated as of January 1, 2001 (the “Purchase Agreement”), between the City and DNR; and

            WHEREAS, the City has established certain funds and accounts with UMB Bank & Trust, N.A., as escrow agent (successor to State Street Bank and Trust Company, N.A., the “Escrow Agent”) pursuant to the Escrow Agreement dated as of January 1, 2001 (the “Original Escrow Agreement”), between the City and the Escrow Agent; and

            WHEREAS, the City has requested, and DNR has approved, subject to the approval of the Clean Water Commission of the State of Missouri (the “Clean Water Commission”), the conversion of the City’s participation from the SRF Leveraged Program to the SRF Direct Loan Program; and

            WHEREAS, Section 1101 of the Original Ordinance permits the City with the prior written consent of DNR and UMB Bank & Trust, N.A., as Paying Agent, and with the recommendation of the Clean Water Commission to DNR, to amend the Original Ordinance; and

            WHEREAS, Section 7.5 of the Original Purchase Agreement provides that the Original Purchase Agreement may be amended or supplemented by a written instrument executed by DNR and the City; and

            WHEREAS, Section 18 of the Original Escrow Agreement provides that the Original Escrow Agreement may be amended or supplemented by a written instrument executed by the Escrow Agent and the City with the written consent of DNR, as owner of the Bonds; and

            WHEREAS, by Ordinance No. 1185 passed on May 27, 2003 (the “Outstanding Senior Bond Ordinance”), the City has issued its Combined Waterworks and Sewerage System Refunding Revenue Bonds, Series 2003 (the “Outstanding Senior Bonds”), in the original principal amount of $495,000, of which $385,000 remains outstanding as of the date of adoption of this Ordinance; and

            WHEREAS, the Board of Aldermen finds and determines that it is in the best interests of the City to amend the Original Bond Ordinance, the Original Purchase Agreement and the Original Escrow Agreement in connection with the conversion of the Loan (as defined in the Original Purchase Agreement) from the SRF Leveraged Program to the SRF Direct Loan Program;

NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF ALDERMEN OF THE CITY OF RICH HILL, MISSOURI AS FOLLOWS:

            Section 1.          General.  Except as otherwise provided in this Ordinance:

(a)        References to Additional Interest are of no further force and effect.

(b)        References to “SRF Program” means the SRF Direct Loan Program.

            Section 2.          Definitions of Words and Terms.  Section 101 of the Original Ordinance is amended as follows:

            (a)        The definitions of “Authority,” “Authority Bonds,” “Construction Fund”, “SRF Program” “SRF Program Bonds,” and “SRF Program Subsidy Bonds” are deleted.

            (b)        The definitions of “Authority Program Bonds,” “Bonds,” “Escrow Agreement,” “Interest Payment Date,” “Investment Securities,” “Paying Agent,” “Principal Payment Date,” “Purchase Agreement,” “SRF Subsidy” and “System Revenue Bonds” are amended and restated as follows:

“Authority Program Bonds” means any bonds of the Authority issued under the SRF Leveraged Program, all or a portion of the proceeds of which are loaned to the City pursuant to the SRF Leveraged Program.

“Bonds” means the Combined Waterworks and Sewerage System Revenue Bonds (State Revolving Fund – Direct Loan Program) Series 2001 in the original principal amount of $783,800 as of the date of adoption of this Ordinance.

“Escrow Agreement” means the Amended and Restated Escrow Trust Agreement dated as ofSeptember 1, 2005, between the City and the Paying Agent, as escrow agent.

“Interest Payment Date” meansOctober 1, 2005and each March 1 and September 1 thereafter, commencingMarch 1, 2006.

“Investment Securities” means any of the following securities legal for the investment of funds of the City at the time of purchase:

(a)        Federal Securities;

(b)        Direct and general obligations of the State, the payment of the principal of and interest on which the full faith and credit of the State is pledged;

(c)        Deposits which are fully insured by the Federal Deposit Insurance Corporation (“FDIC”) in one or more of the following institutions: banks, trust companies or savings and loan associations (including without limitation, the Paying Agent or any bank affiliated with the Paying Agent) organized under the laws of the United States of America or any state thereof;

(d)        Federal funds, unsecured certificates of deposit, time deposits and bankers acceptances (having maturities of not more than 365 days) of any bank, the short-term obligations of which are rated MIG1 or equivalent by Moody’s Investors Service or Standard & Poor’s Ratings Service;

(e)        Unsecured promissory notes of any bank, trust company, national banking association or bank holding company equal in quality to such institution’s outstanding unsecured long-term debt which is rated in the highest rating category by Moody’s Investors Service or Standard & Poor’s Ratings Service; and

(f)        Shares in money market mutual funds rated in the highest or second highest applicable rating category by Moody’s Investors Service or Standard & Poor’s Ratings Service.

“Paying Agent” means UMB Bank & Trust, N.A., as successor to State Street Bank and Trust Company, N.A., the paying agent and escrow agent, and its successors and assigns acting at any time as Paying Agent and Escrow Agent under this Ordinance and the Escrow Agreement.

“Principal Payment Date” meansOctober 1, 2005and each March 1 thereafter, commencingMarch 1, 2006, and any date on the Bonds are optionally redeemed in accordance with Section 301.

“Purchase Agreement” means the Purchase Agreement dated as ofJanuary 1, 2001, between the City and DNR, as supplemented by the First Supplemental Agreement dated as ofSeptember 1, 2005, between the City and DNR, as further supplemented, modified or amended in accordance with its terms, related to the Bonds.

“SRF Subsidy” means the amount of investment earnings which will accrue on the Reserve Account during each Fiscal Year (taking into account scheduled transfers from the Reserve Account which will occur upon the payment of principal on Authority Program Bonds and assuming that the construction for the applicable project has been completed), if the Reserve Security is equal to the Reserve Percentage of the principal amount of the SRF Leveraged Program Bonds outstanding, the Reserve Account is invested in an investment agreement at a fixed rate during the calculation period and earnings are reduced by the Administrative Fee payable to DNR.  Administrative Fee, Reserve Account and Reserve Percentage as used in this definition have the respective meanings set forth in the bond indentures for the applicable Authority Program Bonds.

“System Revenue Bonds” means collectively the Bonds, the Outstanding Senior Bonds, the Parity Bonds and all other revenue bonds which are payable from the Net Revenues.

            (c)        The following definitions are added:

            “Administrative Expense Fund” means the Administrative Expense Fund established by Section 4 of the Escrow Agreement.

            “Debt Service Reserve Fund” means the Debt Service Reserve Fund established by Section 4 of the Escrow Agreement.

“Debt Service Reserve Requirement” means $65,000.

“SRF Leveraged Program” means the Missouri Leveraged State Drinking Water Revolving Fund Program and the Missouri Leveraged State Water Pollution Control Revolving Fund Program.

“SRF Leveraged Program Bonds” means any bonds of the City issued in connection with the City’s participation in the SRF Leveraged Program.

            Section 2.          Description of the Bonds.  Section 203 of the Original Ordinance is amended and restated as follows:

Section 203.      Description of Bonds.  The Bonds consist of fully registered bonds without coupons, numbered from R-1 consecutively upward, in an amount equal to the currently outstanding principal amount (as of the date of this Ordinance, $783,800) or any integral multiple of $1.  The Bonds will be issued in substantially the form of Exhibit A and will be registered, transferred and exchanged as provided in Section 206.  The Bonds are dated the date of original delivery as set forth on the Bonds.  The Bonds shall mature and become due on March 1, 2022 (subject to optional and mandatory redemption prior to maturity as provided in Article III) and shall bear interest at an annual rate equal to 1.60% from the Dated Date or from the most recent Interest Payment Date to which interest has been paid or provided for.  Interest is payable on each Interest Payment Date.

            Section 3.          Method and Place of Payment of Bonds.  Section 205 is amended and restated as follows:

Section 205.      Method and Place of Payment of Bonds.

(a)        Payment of the Bonds will be made with any coin or currency that is legal tender for the payment of debts due theUnited States of Americaon the payment date.

(b)        The payment of the principal of and redemption premium, if any, payable on each Bond at maturity or upon earlier redemption and the interest payable on each Bond on any Interest Payment Date will be made by check or draft mailed by the Paying Agent to the address of the Owner shown in the Bond Register.  The principal of and redemption premium, if any, and interest on the Bonds is payable by electronic transfer in immediately available federal funds to a bank in the continental United States of America pursuant to instructions from any Owner received by the Paying Agent prior to the Record Date.

(c)        Payments of principal on the Bonds pursuant to Article III may be made directly to the Bondowner without surrender of any Bond to the Paying Agent.  Accordingly, any transferee of a Bond should verify with the Paying Agent the principal of the Bond outstanding prior to such purchase or transfer, and the records of the Paying Agent shall be conclusive for such purposes.

(d)        The Paying Agent will keep a record of payment of principal of, redemption premium, if any, and interest on all Bonds and, at least annually at the request of the City, will forward a copy or summary of the record of payments to the City.

            Section 4.          Administrative Fee and Paying Agent’s Fee.  Section 211 is amended and restated as follows:

Section 211.      Administrative Fee and Paying Agent’s Fee.  Subject to Section 502, the City will pay to the Paying Agent, within 30 days after receipt of a statement from the Paying Agent, (i) the Administrative Fee, and (ii) an amount equal to the Paying Agent’s fees and expenses as provided in the Escrow Agreement. If the Bonds are tendered for purchase by the Bondowner and purchased by the City prior to the first Administrative Fee Calculation Date, no Administrative Fee is payable.

            Section 5.          Mandatory Redemption.  Section 302 is amended and restated as follows:

Section 302.      Mandatory Redemption.  The Bonds are subject to mandatory redemption in part, at a redemption price equal to 100% of the principal amount thereof plus accrued interest to the redemption date, on the dates and in the principal amounts as set forth on the following schedule.

Redemption Date	Principal Amount	Redemption Date	Principal Amount
October 1, 2005	$19,996	March 1, 2014	$46,016
March 1, 2006	16,434	March 1, 2015	46,983
March 1, 2007	39,786	March 1, 2016	47,969
March 1, 2008	40,621	March 1, 2017	48,977
March 1, 2009	41,475	March 1, 2018	50,005
March 1, 2010	42,346	March 1, 2019	51,055
March 1, 2011	43,235	March 1, 2020	52,127
March 1, 2012	44,143	March 1, 2021	53,222
March 1, 2013	45,070	March 1, 2022†	54,340
________

                 ^†  Maturity

 

If Bonds are redeemed in part other than pursuant to the sinking fund requirements of this paragraph (a), the foregoing principal installments will be reduced on a proportionate basis.  The City must designate the amount of the reduction of each principal installment by written notice to the Paying Agent and the Bondowner.  The amount of the reduction is subject to verification by the Bondowner and other verification requirements as may be reasonably established by the Paying Agent.

            Section 6.          Ratification and Establishment of Funds and Accounts.  Section 401 is amended and restated as follows:

Section 401.      Ratification of Funds.

(a)        The separate funds and accounts created in, or ratified and confirmed by, the Outstanding Senior Bond Ordinance known respectively as the:

          (1)        Combined Waterworks and Sewerage System Revenue Fund (the “Revenue Fund”);

          (2)        Combined Waterworks and Sewerage System Operation and Maintenance Fund (the “Operation and Maintenance Account”);

          (3)        Debt Service Fund for Combined Waterworks and Sewerage System (the “Outstanding Senior Bond Debt Service Account”);

          (4)        Debt Service Reserve Fund for Combined Waterworks and Sewerage System (the “Outstanding Senior Bond Debt Service Reserve Account”);

          (5)        Combined Waterworks and Sewerage System Depreciation Fund (the “Depreciation and Replacement Account”); and

          (6)        Combined Waterworks and Sewerage System Surplus Fund (the “Surplus Account”)

(b)        The City hereby establishes the following special funds and accounts with the Paying Agent under the Escrow Agreement:

(1)        the Debt Service Fund;

(2)        the Construction Fund;

(3)        the Repayment Fund and therein the Principal Account and the Interest Account;

(4)        the Debt Service Reserve Fund; and

(5)        the Administrative Expense Fund.

            Section 7.          Revenue Fund; Application of Moneys in Funds and Accounts.  Sections 501 and 502 are amended and restated as follows:

            Section 501.      Revenue Fund.  The City covenants and agrees that from and after the delivery of the Bonds and so long as any of the Bonds remain outstanding and unpaid, all Revenues derived and collected by the City will be deposited into the Revenue Fund when received.  The Revenues will be segregated from all other moneys, revenues, funds and accounts of the City.  The Revenue Fund will be administered and applied solely for the purposes and in the manner provided in the Outstanding Senior Bond Ordinance, this Ordinance and any Parity Ordinance.

Section 502.      Application of Moneys in Funds and Accounts.

(a)        The City will apply moneys in the Revenue Fund on the dates, in the amounts and in the order as follows:

(i)         on the first day of each month there shall be deposited to the Operation and Maintenance Account an amount sufficient to pay the estimated cost of operating and maintaining the System during the month;

(ii)        on the dates required under the Outstanding Senior Bond Ordinance, to the Outstanding Senior Bond Debt Service Account and the Outstanding Senior Bond Debt Service Reserve Account established for the Outstanding Senior Bonds, the amounts required under the Outstanding Senior Bond Ordinance for the following month;

(iii)       on the 20^th day of each month the following amounts to the Paying Agent for credit to the Interest Account and the Principal Account:

(A)       to the Interest Account, (1) on September 20, 2005, $1,046, (2) `on October 20, 2005 and each monthly payment date to and including February 20, 2006, 1/5 of the interest due on the Bonds on March 1, 2006, and (3) on each monthly payment date thereafter 1/6 of the amount of interest on the Bonds due on the next Interest Payment Date, with these monthly payments to be reduced as follows:

(1)        the balance in the Debt Service Fund on an Interest Payment Date after the payment of the principal of and interest due on the Bonds on the Interest Payment Date will be credited against the next succeeding monthly payment or payments; and

(2)        the investment earnings on the Debt Service Reserve Fund for the preceding Interest Period, as set forth in the Paying Agent’s semiannual notice to the City, will be credited in equal installments against the monthly payments due prior to the next Interest Payment Date;

(B)       to the Principal Account, (1) on September 20, 2005, $3,333, (2) on October 20, 2005 and each monthly payment date to and including February 20, 2006, $3,287, and (3) each monthly payment date thereafter, 1/12 of the principal due on the Bonds on the next succeeding Principal Payment Date, whether at maturity or upon mandatory sinking fund redemption;

(iv)       on the dates required by Section 211, to the Paying Agent, the amounts required to pay the Administrative Fee and the Paying Agent’s fees and expenses;

(v)        on the first day of each month, if the Debt Service Reserve Fund balance is less than the Debt Service Reserve Requirement, to the Paying Agent for deposit in the Debt Service Reserve Fund, $1,250 until the Debt Service Reserve Fund equals the Debt Service Reserve Requirement;

(vi)       to the Depreciation and Replacement Account (i) on the first day of each month the amounts required to be deposited pursuant to the Outstanding Senior Bond Ordinance, plus (ii) the amount on the dates required by the User Charge Ordinance; and

(vii)      on the first day of each month the remaining balance to the Surplus Account.

(b)        Except as provided in Section 503, moneys in the Depreciation and Replacement Account will be used by the City for the purpose of making replacements and repairs to the System in order to keep the System in good repair and working order and to assure the continued effective and efficient operation of the System.  This provision will not be construed to modify any more restrictive provision of the Outstanding Senior Bond Ordinance for the use of moneys in the Depreciation and Replacement Account.

(c)        Moneys in the Surplus Account are to be expended for the following purposes as determined by the Governing Body:

(1)        paying the cost of the operation, maintenance and repair of the System to the extent necessary after the application of the moneys held in the Operation and Maintenance Account and in the Depreciation and Replacement Account;

(2)        paying the cost of extending, enlarging or improving the System;

(3)        preventing default in, anticipating payments into or increasing the amounts in the accounts confirmed or established in Section 401, the Principal Account, the Interest Account, the Debt Service Reserve Fund or the Depreciation and Replacement Account, or establishing or increasing the amount of any debt service account or debt service reserve account created by the City for the payment of any System Revenue Bonds subsequently issued; or

(4)        redeeming and paying prior to maturity, or, at the option of the City, purchasing in the open market at the best price obtainable not exceeding the call price (if any bonds are callable), the Outstanding Senior Bonds, the Bonds or any other System Revenue Bonds of the City hereafter issued.

(d)        All amounts paid and credited to the Operation and Maintenance Account will be expended solely for the purpose of paying the Current Expenses of the System.

(e)        If the deposits to the Operation and Maintenance Account (the “OM Deposits”) required under this Section are greater than the OM Deposits required in the User Charge Ordinance, the OM Deposits under the User Charge Ordinance will be deemed a credit toward OM Deposits required under this Section.  If the OM Deposits required under this Section are less than those required in the User Charge Ordinance, OM Deposits under this Section will be deemed a credit to OM Deposits required under the User Charge Ordinance.

(f)        No moneys derived by the City from the System will be diverted to the general governmental or municipal functions of the City.

            Section 8.          Business Days.  Article V is further amended by inserting the following Section 505:

Section 505.      Business Days.  If any date for the payment of principal of, redemption premium, if any, or interest on the Bonds or the taking of any other action hereunder is not a Business Day, then such payment shall be due, or such action shall be taken, on the first Business Day thereafter with the same force and effect as if made on the date fixed for payment or performance.

            Section 9.          Investment of Moneys.  Section 601(a) is amended and restated as follows:

(a)        Moneys held in any fund or account referred to in this Ordinance may be invested in Investment Securities; provided, however, that any Fund held by the Paying Agent shall be invested as provided in Section 11 of the Escrow Agreement.  No such investment shall be made for a period extended longer than the date when the money invested may be needed for the purpose for which such fund or account was created.  All earnings on any investments held in any fund or account shall accrue to and become a part of such fund or account.  All earnings on investments held in the Debt Service Reserve Fund shall accrue to and become a part of the Debt Service Reserve Fund until the amount on deposit in the Debt Service Reserve Fund equals the Debt Service Reserve Requirement; thereafter, all such earnings shall be credited to the Interest Account.  In determining the amount held in any fund or account under any of the provisions of this Ordinance, obligations shall be valued at the lower of the cost or the market value thereof; provided, however, that investments held in the Debt Service Reserve Fund shall be valued at market value only.  If and when the amount held in any fund or account held within the Treasury of the City shall be in excess of the amount required by the provisions of this Ordinance, the City shall direct that such excess be paid and credited to the Revenue Fund.

            Section 10.        Particular Covenants of the City.  Article VII is amended and restated as follows:

Section 701.      Efficient and Economical Operation; User Charge Ordinance.  The City will continuously own and will operate the System in an efficient and economical manner and will keep and maintain the same in good repair and working order.  The City has duly approved the User Charge Ordinance and will enforce the provisions thereof.  The City will not amend, modify, supplement or restate the User Charge Ordinance unless the City shall have received the prior written consent of DNR.

Section 702.      Rate Covenant.  The City will fix, establish, maintain and collect rates and charges for the use and services furnished by or through the System to produce income and revenues sufficient to (a) pay the costs of the operation and maintenance of the System; (b) pay the principal of and interest on the Bonds as and when due; (c) enable the City to have in each Fiscal Year Net Revenues of not less than 110% of the amount required to be paid by the City in the Fiscal Year on account of both principal of and interest on all System Revenue Bonds at the time outstanding, provided that interest on any SRF Program Bonds will be reduced by the SRF Subsidy, if any; and (d) provide reasonable and adequate reserves for the payment of the Bonds and the interest thereon and for the protection and benefit of the System as provided in this Ordinance.  The City will require the prompt payment of accounts for service rendered by or through the System and will promptly take whatever action is legally permissible to enforce and collect delinquent charges.

Section 703.      Reasonable Charges for all Services.  None of the facilities or services provided by the System will be furnished to any user (excepting the City itself) without a reasonable charge being made therefor.  If the income and revenues derived by the City from the System are insufficient to pay the reasonable expenses of operation and maintenance of the System and the principal of and interest on the Bonds when due, the City will pay into the Revenue Fund a fair and reasonable payment in accordance with effective applicable rates and charges for all services or other facilities furnished to the City or any of its departments by the System.

Section 704.      Annual Budget.  Prior to the commencement of each Fiscal Year, the City will cause a budget setting forth the estimated receipts and expenditures of the System for the next succeeding Fiscal Year to be prepared and filed with the City Clerk.  The City Clerk, within 30 days after the end of the current Fiscal Year, will mail a copy of the budget to the Bondowner.  The annual budget will be prepared in accordance with the laws of the State.

Section 705.      Annual Audit.

(a)        Promptly after the end of each Fiscal Year, the City will cause an audit of the System for the preceding Fiscal Year to be made by a certified public accountant or firm of certified public accountants employed for that purpose and paid from the Revenues.  The annual audit will cover in reasonable detail the operation of the System during the Fiscal Year.

(b)        Within 180 days after the end of the City’s Fiscal Year, a copy of the annual audit will be filed in the office of the City Clerk, and a duplicate copy of the audit will be mailed to the Bondowner.  The annual audit will be open to examination and inspection during normal business hours by any Owner of the Bonds, or anyone acting for or on behalf of the Owner.

(c)        As soon as possible after the completion of the annual audit, the Governing Body will review the annual audit, and if the annual audit reveals any breach of this Ordinance, the City agrees to promptly cure the breach.

Section 706.      Performance of Duties.  The City will faithfully and punctually perform all duties and obligations with respect to the operation of the System, including all extensions and improvements thereto, now or hereafter imposed upon the City by the constitution and laws of the State ofMissouri and by the provisions of this Ordinance.

            Section 11.        Additional Bonds.  Article VIII is amended and restated as follows:

Section 801.      No Prior Lien Bonds.  Except as provided in Section 804(b), the City will not issue any debt obligations payable out of the Net Revenues which are superior in lien, security or otherwise to the Bonds.

Section 802.      Parity Lien Bonds or Obligations.

            (a)        The City will not issue any additional bonds or other long-term obligations payable out of the Net Revenues of the System which stand on a parity or equality with the Bonds unless the following conditions are met:

            (1)        the City is not in default in the payment of principal or interest on the Bonds or any Parity Bonds or in making any deposit into the funds and accounts under this Ordinance or any Parity Ordinance; and

            (2)        the City provides to the Bondowner a certificate showing either of the following:

(A)       the average annual Net Revenues as set forth in the two most recent annual audits for Fiscal Years preceding the issuance of additional bonds, are at least 110% of the average annual debt service on the System Revenue Bonds, including the additional bonds proposed to be issued, to be paid out of the Net Revenues in all succeeding Fiscal Years.  Interest to be paid on any SRF Program Bonds may be reduced by the SRF Subsidy, if any.  If the City has made any increase in rates for the use and services of the System and the increase has not been in effect during all of the two Fiscal Years for which annual audits are available, the City may add the additional Net Revenues which would have resulted if the rate increase had been in effect for the entire period to the audited Net Revenues, as certified by a Consultant; or

(B)       the estimated average annual Net Revenues for the two Fiscal Years immediately following the Fiscal Year in which the improvements to the System being financed by the additional bonds are to be in commercial operation, as certified by a Consultant, is at least 110% of the average annual debt service on the System Revenue Bonds, including the additional bonds proposed to be issued, to be paid out of the Net Revenues in succeeding Fiscal Years following the commencement of commercial operation  of the improvements.  Interest to be paid on any SRF Program Bonds may be reduced by the SRF Subsidy, if any.  In determining the amount of estimated Net Revenues for the purpose of this subsection, a Consultant may adjust the estimated net income and revenues by adding the estimated increase in Net Revenues resulting from any increase in rates for the use and services of the System approved by the City.

            (b)        If the conditions set forth in this Section are satisfied, the City (i) may issue additional revenue bonds or other obligations of the City on a parity with the Bonds and that enjoy complete equality of the lien on the Net Revenues with the Bonds, (ii) may make equal provision for paying the additional revenue bonds or other obligations from the Revenue Fund, and (iii) may secure the additional revenue bonds or other obligations by funding reasonable System debt service accounts and debt service reserve accounts from the Net Revenues.

Section 803.      Junior Lien Bonds.  Nothing in this Article prohibits or restricts the right of the City to issue additional revenue obligations, including revenue bonds, for the purpose of extending, improving, enlarging, repairing or altering the System, that are subordinate to the Bonds if at the time of the issuance of the additional revenue obligations the City is not in default in the performance of any covenant or agreement in this Ordinance.  If the City is in default in paying either interest on or principal of the Bonds, the City will not make any payments on the subordinate revenue obligations until the default is cured.  Subject to the limitations in this Section, the City may make provision for paying the principal of and interest on the subordinate revenue bonds or obligations from moneys in the Revenue Fund.

            Section 804.      Refunding Bonds.

            (a)        The City may, without complying with the provisions of Section 802, refund any of the Bonds or any Parity Bonds in a manner which provides debt service savings to the City, and the refunding bonds so issued will be on a parity with any of the Bonds or any Parity Bonds that are not refunded and any other Parity Bonds of the City then outstanding.  If the Bonds are refunded in part and the refunding bonds bear a higher average rate of interest or become due on a date earlier than that of the Bonds which are refunded, the City must obtain the prior written consent of the Bondowner and DNR to the issuance of the refunding bonds.

            (b)        The City may refund any of the Outstanding Senior Bonds in a manner which provides debt service savings to the City in each subsequent Fiscal Year, and the refunding bonds so issued may have a priority lien on the Revenues of the System.

            Section 12.        Default and Remedies.  Article IX is amended and restated as follows:

            Section 901.      Event of Default.  If (i) the City defaults in the payment of the principal of or interest on any of the Bonds, or (ii) the City or its Governing Body or any of its officers, agents or employees fails or refuses to comply with any provision of this Ordinance, the Constitution or statutes of the State, the Purchase Agreement or the Escrow Agreement and default continues for a period of 60 days after written notice specifying the non-payment default has been given to the City by the Owner of any Bond then Outstanding, at any time thereafter and while the default continues, the City shall pay to DNR the penalties assessed by DNR in accordance with the Regulations.

            Section 902.      Remedies.

            (a)        The provisions of this Ordinance constitute a contract between the City and the Owners of the Bonds.  The Owner or Owners of not less than 10% in principal amount of the Bonds at the time Outstanding have the right for the equal benefit and protection of all Owners of Bonds similarly situated:

(1)        by any proceeding at law or in equity to enforce the rights of the Owner or Owners against the City and its officers, agents and employees, and to compel the performance by the City of its duties and obligations under this Ordinance, the Constitution and the laws of the State;

(2)        by any proceeding at law or in equity to require the City, its officers, agents and employees to account as if they were the trustees of an express trust; and

(3)        by any proceeding at law or in equity to enjoin any act or thing which is unlawful or in violation of the rights of the Owners of the Bonds.

            (b)        Any amounts paid on the Bonds to the Owners will be applied first to interest and second to principal, to the extent due and payable.

            Section 903.      Limitation on Rights of Bondowners.  No Owner has any right in any manner whatever by the Owner’s action to affect, disturb or prejudice the security granted and provided for in, or enforce any right under, this Ordinance, except in the manner provided in this Ordinance.  All proceedings at law or in equity will be for the equal benefit of all Owners.

            Section 904.      Remedies Cumulative.  No remedy conferred upon the Owners is intended to be exclusive of any other remedy.  Each remedy is in addition to every other remedy and may be exercised without exhausting any other remedy conferred under this Ordinance.  No waiver by any Owner of any default or breach of duty or contract of the City under this Ordinance will affect any subsequent default or breach of duty or contract by the City or impair any rights or remedies thereon.  No delay or omission of any Owner to exercise any right or power accruing upon any default will impair any right or power or will be construed to be a waiver of any default.  Every substantive right and every remedy conferred upon the Owners of the Bonds by this Ordinance may be enforced and exercised from time to time and as often as may be expedient.  If any Owner discontinues any proceeding or the decision in the proceeding is against the Owner, the City and the Owners of the Bonds will be restored to their former positions and rights under this Ordinance.

            Section 905.      No Obligation to Levy Taxes.  Nothing in this Ordinance imposes any duty or obligation on the City to levy any taxes either to meet any obligation incurred under this Ordinance or to pay the principal of or interest on the Bonds.

            Section 13.        Defeasance.  Article X is amended and restated as follows:

Section 1001.    Defeasance.  When all of the Bonds shall have been paid and discharged, then the requirements contained in this Ordinance and the pledge of revenues made hereunder and all other rights granted hereby shall terminate.  Bonds shall be deemed to have been paid and discharged within the meaning of this Ordinance if there shall have been deposited with the Paying Agent, or other bank or trust company located in the State of Missouri, having full trust powers and meeting the requirements of a successor Paying Agent (as set forth in the Escrow Agreement) impressed with a first lien to the Paying Agent for the benefit of the Bondowners, at or prior to the maturity or redemption date of said Bonds, in trust for and irrevocably appropriated thereto, moneys and/or non-callable Defeasance Securities (the “Defeasance Escrow”) which, together with the interest to be earned on any such obligations, will be sufficient for the payment of the principal of said Bonds and interest to accrue to the date of maturity or redemption, as the case may be, or if default in such payment shall have occurred on such date, then to the date of the tender of such payments, provided, however, that if any such Bonds shall be redeemed prior to the maturity thereof, (i) the City shall have elected to redeem such Bonds, and (ii) either notice of such redemption shall have been given or the City shall have given irrevocable instructions to the Paying Agent to redeem such Bonds; and provided further, however, there shall be filed with the City, the Bondowner and the Paying Agent an opinion of Bond Counsel to the effect that the conditions for the defeasance of the Bonds pursuant to this Section 1001 have been complied with and, if the payment of the Bonds at maturity or upon redemption will occur more than 90 days after the deposit of the Defeasance Escrow and interest on the Defeasance Escrow is to be used to pay debt service on the Bonds, the written report of an independent certified public accountant evidencing the sufficiency of the Defeasance Escrow.  Any moneys and obligations which at any time shall be deposited with the Paying Agent, or other bank by or on behalf of the City, for the purpose of paying and discharging any of the Bonds shall be and are hereby assigned, transferred and set over to the Paying Agent or other bank in trust for the respective Owners of the Bonds, and such moneys shall be and are hereby irrevocably appropriated to the payment and discharge of this Ordinance.  All moneys deposited with the Paying Agent or other bank shall be deemed to be deposited in accordance with and subject to all of the provisions contained in this Ordinance.

            Section 14.        Amendments.  Article XI is amended and restated as follows:

Section 1101.    Amendments.

            (a)        Any provision of the Bonds or of this Ordinance may be amended by an Ordinance with the written consent of the Bondowner.  Consent must be evidenced by an instrument executed by the Bondowner, acknowledged or proved in the manner of a deed to be recorded, and filed with the City Clerk.

            (b)        No amendment will be effective until (i) the City has delivered to the Bondowner and the Paying Agent an opinion of Bond Counsel stating that the amendment is permitted by this Ordinance and the Act, complies with their respective terms and is valid and binding upon the City in accordance with its terms, and (ii) the City Clerk has on file a copy of the amendment and all required consents.

            Section 15.        Form of Bond.  Exhibit A, the form of Bond, is amended and restated as set forth in Exhibit A to this Ordinance.  The Mayor and the City Clerk are directed to prepare and execute the Bonds, and when executed, to deliver the Bonds to the Paying Agent for authentication.  Upon authentication, the Paying Agent will deliver the Bonds to DNR, as Bondowner.

Section 16.         Authorization and Execution of Documents.  The City is authorized to enter into the First Supplemental Agreement (Purchase Agreement) dated as of September 1, 2005, between the City and DNR, and the Amended and Restated Escrow Trust Agreement dated as of September 1, 2005, between the City and the Paying Agent, in substantially the forms presented to the Board of Aldermen.  The Mayor is authorized to execute the First Supplemental Agreement (Purchase Agreement) and the Amended and Restated Escrow Trust Agreement for and on behalf of and as the act and deed of the City, with changes approved by the Mayor, which approval will be conclusively evidenced by the Mayor’s signature.  The Mayor is further authorized and directed to execute other documents, certificates and instruments that are necessary or desirable to carry out the intent of this Ordinance.  The City Clerk is authorized and directed to attest the execution of the First Supplemental Agreement (Purchase Agreement) and the Amended and Restated Escrow Trust Agreement and any other documents, certificates and instruments that are necessary or desirable to carry out the intent of this Ordinance.

Section 17.        Conflicts.  All Ordinances and parts of Ordinances in conflict with this Ordinance are hereby repealed.

            Section 18.        Severability.  If any section or other part of this Ordinance is for any reason held invalid, the invalidity will not affect the validity of the other provisions of this Ordinance.

            Section 19.        Governing Law.  This Ordinance is governed by and will be construed in accordance with the laws of the State.

            Section 20.        Effective Date.  This Ordinance is in full force and effect from and after its passage by the City Council and approval by the Mayor.

            PASSED by the Board of Aldermen of the City of Rich Hill, Missouri, AND APPROVED by the Mayor this 23rd day of August, 2005.

                                                                 

                               Mayor

(SEAL)

ATTEST:

                                                           

                       City Clerk

EXHIBIT A

 

FORM OF BOND 

[THIS BOND IS TRANSFERABLE ONLY TO ANY SUCCESSOR TO THE

MISSOURI DEPARTMENT OF NATURAL RESOURCES OR ITS ASSIGNS] 

Registered                                                                                                                       Registered

No. R-_______                                                                                                       $____________

UNITED STATES OF AMERICA

STATE OF MISSOURI 

CITY OF RICH HILL, MISSOURI 

COMBINED WATERWORKS AND SEWERAGE SYSTEM REVENUE BOND

(STATE REVOLVING FUND – DIRECT LOAN PROGRAM)

SERIES 2001

 

Dated Date	Interest Rate	Maturity Date
September __, 2005	1.60%	March 1, 2022

 

REGISTERED OWNER:          MISSOURI DEPARTMENT OF NATURAL RESOURCES

PRINCIPAL AMOUNT:                                                                                             DOLLARS

The CITY OF RICH HILL, MISSOURI, a fourth class city and political subdivision of the State of Missouri (the “City”), for value received, hereby promises to pay to the Registered Owner shown above, or registered assigns, the Principal Amount shown above on the Maturity Date shown above, and to pay interest thereon at the Interest Rate per annum shown above plus Additional Interest as described in the herein defined Ordinance (computed on the basis of a 360-day year of twelve 30-day months) from the Dated Date shown above or from the most recent interest payment date to which interest has been paid or duly provided for, payable semiannually on April 1 and October 1 in each year, commencing on the first April 1 or October 1 following the authentication of this Bond by the Paying Agent, until the Principal Amount has been paid.

The principal of this Bond shall be paid at maturity or upon earlier redemption to the person in whose name this Bond is registered at the maturity or redemption date thereof, upon presentation and surrender of this Bond at the principal corporate trust office of UMB BANK & TRUST, N.A. inSt. Louis,Missouri(the “Paying Agent”).  The interest payable on this Bond of any interest payment date shall be paid by check or draft mailed by the Paying Agent to the person in whose name this Bond is registered on the Bond Register maintained by the Paying Agent at the close of business on the Record Date for such interest, which shall be the fifteenth day (whether or not a business day) of the calendar month next preceding such interest payment date.  The principal of and interest on this Bond shall be payable in lawful money of theUnited States of America.

This Bond is one of a duly authorized series of bonds of the City designated “Combined Waterworks and Sewerage System Revenue Bonds (State Revolving Fund – Direct Loan Program) Series 2001” (the “Bonds”), issued by the City for the purpose of extending and improving the combined waterworks and sewerage system owned and operated by the City (said combined waterworks and sewerage system, together with all future improvements and extensions thereto hereafter constructed or acquired by the City, being herein called the “System”), under the authority of and in full compliance with Chapter 250 of the Revised Statutes of Missouri, as amended, and pursuant to elections duly held in the City and Ordinance No. 1120, as amended by Ordinance No. 1244, each duly adopted by the governing body of the City (collectively, the “Ordinance”).

At the option of the City, the Bonds may be called for redemption and payment prior to maturity in whole or in part as provided in the Ordinance.

This Bond is subject to mandatory redemption and payment prior to maturity pursuant to the mandatory redemption requirements of the Ordinance, at a redemption price equal to 100% of the principal amount plus accrued interest to the redemption date.

Except as otherwise provided in the Ordinance, notice of redemption, unless waived, is to be given by the Paying Agent by mailing an official redemption notice by registered or certified mail at least 15 days, but not more than 30 days, prior to the date fixed for redemption, to the Registered Owner of the Bond or Bonds to be redeemed at the address shown on the Bond Register or at such other address as is furnished in writing by such Registered Owner to the Paying Agent.  Notice of redemption having been given or waived as aforesaid, the Bonds or portions of Bonds so to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date (unless the City shall default in the payment of the redemption price) such Bonds or portions of Bonds shall cease to bear interest.

The Bonds are limited obligations of the City payable solely from, and secured as to the payment of principal and interest by a pledge of, the Net Revenues derived by the City from the operation of the System after providing for the costs of operation and maintenance of the System, and the taxing power of the City is not pledged to the payment of the Bonds either as to principal or interest.  The Bonds shall not be or constitute a general obligation of the City, nor shall they constitute an indebtedness of the City within the meaning of any constitutional, statutory or charter provision, limited or restriction.

The Bonds are subordinate with respect to payment of principal and interest from the Net Revenues (as defined in the Ordinance) and in all other respects with the Outstanding Senior Bonds (as defined in the Ordinance).  In the event of any default in the payment of either principal of or interest on any of the Outstanding Senior Bonds, the Net Revenues will be applied solely to the payment of the principal of and interest on the Outstanding Senior Bonds until the default is cured.

Under the conditions set forth in the Ordinance, the City has the right to issue additional parity bonds payable from the same source and secured by the same revenues as the Bonds; provided, however, that such additional bonds may be so issued only in accordance with and subject to the covenants, conditions and restrictions relating thereto set forth in the Ordinance.

The City hereby covenants with the Owner of this Bond to keep and perform all covenants and agreements contained in the Ordinance, and the City will fix, establish, maintain and collect such rates, fees and charges for the use and services furnished by or through the System, as will produce revenues sufficient to pay the costs of operation and maintenance of the System, pay the principal of and interest on the Bonds as and when the same become due, and provide reasonable and adequate reserve funds.  Reference is made to the Ordinancefor a description of the covenants and agreements made by the City with respect to the collection, segregation and application of the revenues of the System, the nature and extent of the security of the Bonds, the rights, duties and obligations of the City with respect thereto, and the rights of the Owners thereof.

This Bond may be transferred or exchanged, as provided in the Ordinance, only upon the registration books kept for that purpose at the above-mentioned office of the Paying Agent, upon surrender of this Bond together with a written instrument of transfer or exchange satisfactory to the Paying Agent duly executed by the Registered Owner or the Registered Owner’s duly authorized agent, and thereupon a new Bond or Bonds in any authorized denomination of the same maturity and in the same aggregate principal amount shall be issued to the transferee in exchange therefor as provided in the Ordinance, and upon payment of the charges therein prescribed.  The City and the Paying Agent may deem and treat the person in whose name this Bond is registered on the Bond Register as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal or redemption price hereof and interest due hereon and for all other purposes.

This Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Ordinance until the Certificate of Authentication hereon shall have been executed by the Paying Agent.

IT IS HEREBY CERTIFIED AND DECLARED that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of the Bonds have existed, happened and been performed in due time, form and manner as required by law, and that before the issuance of the Bonds, provision has been duly made for the collection and segregation of the revenues of the System and for the application of the same as hereinbefore provided.

            IN WITNESS WHEREOF, the City of Rich Hill, Missouri has executed this Bond by causing it to be signed by the manual signature of the Mayor and attested by the manual signature of its City Clerk, and its official seal to be affixed hereto or imprinted hereon, and this Bond to be dated the Dated Date shown above.

(SEAL)                                                                  CITY OF RICH HILL,MISSOURI

ATTEST:

                                                                              By                                                             

                       City Clerk                                                                      Mayor

CERTIFICATE OF AUTHENTICATION

            This Bond is one of the Bonds of the issue described in the within-mentioned Ordinance.

Registration Date:                                             

UMB BANK & TRUST, N.A., Paying Agent

By                                                             

                     Authorized Signatory

RECORD OF PRINCIPAL PAYMENTS AND PREPAYMENTS 

Under the provisions of the Ordinance, payments of the principal installments of this Bond and partial prepayments of the principal of this Bond may be made directly to the Bondowner without surrender of this Bond to the Paying Agent.  Accordingly, any purchaser or other transferee of this Bond should verify with the Paying Agent the principal of this Bond outstanding prior to such purchase or transfer, and the records of the Paying Agent shall be conclusive for such purposes.

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

______________________________________________________________________________

Print or type Name, Address and Social Security Number

or other Taxpayer Identification Number of Transferee

the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints _________________________ agent to transfer the within Bond on the books kept by the Paying Agent for the registration thereof, with full power of substitution in the premises.

Dated:                                                                                                                                           

                                                                        NOTICE:  The signature to this assignment must correspond with the name of the Registered Owner as it appears upon the face of the within Bond in every particular.

                                                                        Signature Guaranteed By:

                                                                                                                                                           

NOTICE:  Signature(s) must be guaranteed by an eligible guarantor institution as defined by SEC Rule 17Ad-15 (17 CFR 240.17Ad-15)

CERTIFICATE

I, the undersigned, City Clerk of the City of Rich Hill, Missouri, hereby certify that the above and foregoing constitutes a fully, true and correct copy of Ordinance No. 1244 duly adopted by the Board of Aldermen of the City at a meeting duly and specially held, after proper notice thereof, on September __ 2005; that said Ordinance has not been modified, amended or repealed, and is in fully force and effect as of the date hereof; and that the same is one file in my office.

WITNESS my hand and official seal this 23^rd day of August, 2005.

                                                                 

City Clerk

(Seal)

 

AN ORDINANCE DECLARING PARK AVENUE AN UNDIVIDED THOROUGHFARE AND REQUIRING THAT ALL DRIVERS OF MOTOR VEHICLES STOP WHILE SCHOOL BUS IS LOADING AND UNLOADING.

BE IT ORDAINED by the Board of Alderman of the City of Rich Hill, Missouri as follows:

Section 1.  For purposes of Section 2 of this Ordinance, Park Avenue within the City of Rich Hill, Missouri from 5^th Street to 14^th Street is hereby declared as an undivided thoroughfare within the City of Rich Hill, Missouri.

Section 2. The driver of a motor vehicle upon Park Avenue within the City of Rich Hill, Missouri between 5^th Street and 14^th Street upon meeting or overtaking from either direction any school bus which has stopped on Park Avenue for the purpose of receiving or discharging any school children and whose driver has in the manner described by law given the signal to stop, shall stop the vehicle before reaching such school bus and shall not proceed until such school bus resumes motion, or until signaled by it’s driver to proceed.  This requirement shall apply regardless of what side of the median and or driving side of Park Avenue the school bus and/or motor vehicle may be located including those situations where the school bus and motor vehicle are traveling on opposite sides of the median or driving side of Park Avenue and/or are traveling in opposite directions on Park Avenue.

Section 3.  Any person, firm, corporation or other legal entity violating the provisions of this Ordinance shall be assessed a fine in an amount not exceeding $500.00.                                                                          

Section 4.    All Ordinances or parts of Ordinances, in conflict with the provisions of this Ordinance are hereby repealed.

Section 5.  The invalidity of any section, clause, sentence or provisions of this Ordinance shall not effect the validity of any other part of this Ordinance which can be given effect without such invalid part or parts.

Section 6.   This Ordinance shall be in full force and effect from and after it’s passage and approval as provided by law.

READ TWO TIMES AND PASSED THIS 23^RD DAY OF AUGUST, 2005.

_________________________

Tammy Williams, Mayor

ATTEST:

___________________________

Rose Entrikin, City Clerk

 

AN ORDINANCE AMENDING AND CORRECTING SALES TAX ORDINANCE NUMBER 1198

WHEREAS, by Bill No. 182, Ordinance No. 1198 passed on the 23^rd day of December 2003, and approved by voters on April 6, 2004, the City of Rich Hill imposed a sales tax at the rate of 1% of the receipts on the sales at retail of all goods and services subject to sales tax imposed by the State of Missouri for the purpose of providing funds for continued operation and maintenance of a full time police department, fire department and parks system.  One half cent to be used for the continued operation and maintenance of the police department, one fourth cent to be used for repair and replacement of fire department equipment and facility, and one fourth to be used for the maintenance of and improvements to the city park system; and

WHEREAS, after the adoption of said Sales Tax Ordinance for the Police Department, Parks and Fire Department, and its approval by voters at an election held on April 6, 2004, it was determined that certain sections of the ordinance contained clerical errors; and

WHEREAS, the Board of Alderman of the City of Rich Hill, Missouri has determined that the ballot language contained in said ordinance and submitted to voters was correct and have contacted the Missouri Department of Revenue who in turn advised the City that since the ballot language for the imposition of the sales tax was correct as adopted, the past collection of the sales tax was and is valid but that the city should correct the clerical errors contained in the original ordinance in the manner hereinafter set forth.

NOW THEREFORE, BE IT ORDAINED BY THE BOARD OF ALDERMAN OF THE CITY OF RICH HILL, MISSOURI, AS FOLLOWS:

1.         That Bill No. 182, Ordinance No. 1198 of the City of Rich Hill, Missouri is hereby amended, nunc pro tunc, to correct the following sections of that ordinance to read as if originally adopted as follows;

Section 1.         Pursuant to the authority granted by the provisions of Sections 94.500 to 94.570 RSMo., a tax for the continued operation and maintenance of the police department, the repair and maintenance of fire department equipment and facility, and maintenance of and improvements to the city park system, is hereby imposed upon all sellers for the privilege of engaging in the business of selling tangible personal property or rendering taxable services at retail to the extent and in the manner provided in Section 144.010 to 144.525 RSMo., and the rules and regulations of the Director of Revenue issued pursuant thereto.  The rate of the tax shall be one percent (1%) on the receipts from the sale at retail of all tangible personal property or taxable services at retail within the City of Rich Hill, Missouri, if such property and taxable services are subject to taxation by the State ofMissouri, under the provisions of Sections 144.010 to 144.525 RSMo.  The tax shall become effective as provided in subsection 4 of Section 94.510 RSMo., and shall be collected pursuant to the provisions of Sections 94.500 to 94.550 RSMo.

Section 6.       All revenue received by the City of Rich Hill, Missouri as a result of the tax hereby created shall be for the purpose of providing funds for the continued operation and maintenance of the police department, repair and maintenance of fire department equipment and facilities, and the maintenance of and improvements to the city parks system.  One half cent to be used for the continued operation and maintenance of the police department, one fourth cent to be used for repair and replacement of fire department equipment and facility, and one fourth to be used for the maintenance of and improvements to the city park system. 

2.         That the balance of Bill No. 182, Ordinance No. 1198 shall continue to read in the form originally adopted.

3.         All ordinances or parts of ordinances in conflict with the provisions of this ordinance are hereby repealed