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ORDINANCE NO. 19,290
3 AN ORDINANCE AUTHORIZING THE ISSUANCE OF A PROMISSORY
4 NOTE TO PROVIDE SHORT -TERM FINANCING UNDER
5 AMENDMENT NO. 78 TO THE ARKANSAS CONSTITUTION FOR THE
6 ACQUISITION, CONSTRUCTION, AND INSTALLATION OF REAL
7 AND TANGIBLE PERSONAL PROPERTY; PROVIDING FOR THE
8 PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE NOTE;
9 AND PRESCRIBING OTHER MATTERS PERTAINING THERETO; AND
10 DECLARING AN EMERGENCY.
11
12 WHEREAS, the City of Little Rock, Arkansas (the "City ") is authorized and
13 empowered under the provisions of Amendment No. 78 to the Arkansas Constitution
14 ( "Amendment No. 78 ") and Act No. 1808 of 2001 (codified as Title 14, Chapter 78 of the
15 Arkansas Code of 1987 Annotated) (the "Act "), to issue notes and to expend the proceeds
16 thereof to finance all or a portion of the cost of acquiring, constructing, and installing real
17 property or tangible personal property having an expected useful life of more than one
18 year; and
19 WHEREAS, the City proposes to acquire, construct, and install computers and
20 software for the Fire Department, a radio system for the Planning & Development
21 Department, property for bike /running trails for the Parks Department, property at State
22 and LaHarpe Streets for the General Government Department, technology improvements
23 for the Information Technology Department, print shop equipment for the Finance
24 Department, a penguin exhibit for the Zoo, alert center reconstruction for the
25 Neighborhood Housing & Programs Department, new roof, paint shop, and vehicles for
26 the Fleet Services Department, and facility improvements for the Public Works — General
27 Department (collectively, the "Property "); and
1 WHEREAS, it is proposed that the City issue its promissory note in the principal
2 amount of $4,930,000 (the "Note ") under Amendment No. 78 and the Act for the purpose
3 of financing all or a portion of the costs of the acquisition, construction, and installation of
4 the Property; and
5 WHEREAS, the City intends to arrange for a loan (the "Loan ") from a financial
6 institution (the "Lender ") and to issue the Note to the Lender at a price of par in
7 consideration for the Loan;
8 NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF
9 THE CITY OF LITTLE ROCK, ARKANSAS, THAT:
10 Section 1. The Board of Directors hereby finds that the Property is real property or
11 tangible personal property having a useful life of more than one year. The Board of
12 Directors further finds that the sum of the principal amount of the Note and the
13 outstanding principal amount of the City's Promissory Notes dated February 11, 2002,
14 September 25, 2002, June 18, 2003, and September 8, 2004 does not exceed five percent of
15 the assessed value of taxable property located within the City as determined by the last tax
16 assessment completed before the issuance of the Note.
17 Section 2. Under the authority of the Constitution and laws of the State of Arkansas,
18 including particularly Amendment No. 78 and the Act, the Note is hereby authorized and
19 ordered issued in the principal amount of $4,930,000 for the purpose of financing all or a
20 portion of the costs of acquiring, constructing, and installing the Property and paying
21 expenses of issuing the Note. The Note shall be dated the date of issuance and shall bear
22 interest on the outstanding principal amount at a fixed rate not to exceed 5.50% per annum
23 (calculated on the basis of the actual number of days elapsed in a year of 365 days (366 days
24 in a leap year)). The Note shall be repaid in five substantially equal annual amortized
25 installments of principal and interest, commencing one year from the date of the Note and
26 continuing on the same day of each year thereafter, with the final installment due five years
27 from the date of the Note. The Note shall be issued in fully registered form.
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1 Section 3. The Note shall be issued to the Lender in consideration for the Loan. The
2 Lender shall be selected by the Mayor based upon the commitment or proposal for the
3 Loan that the Mayor determines to have the lowest cost to the City. The City Treasurer is
4 hereby authorized and directed to solicit proposals or commitments for the Loan from at
5 least three financial institutions having offices in Pulaski County or having requested to be
6 solicited, in such manner as shall be approved by the Mayor. The Mayor shall have the
7 right to reject any and all proposals and commitments.
8 Section 4. As provided in Amendment No. 78, the annual debt service payments on
9 the Note in each fiscal year shall be charged against and paid from the general revenues of
10 the City for such fiscal year. For the purpose of making the annual debt service payments,
11 there is hereby, and shall be, appropriated to pay the Note, an amount of general revenues
12 of the City sufficient for such purposes. The City Treasurer is hereby authorized and
13 directed to withdraw from the General Fund of the City the amounts and at the times
14 necessary to make the annual debt service payments on the Note.
15 Section 5. The City covenants with the owner of the Note (the "Owner ") from time
16 to time as follows:
17 (a) The City shall not take any action or suffer or permit any action to be taken or
18 condition to exist which causes or may cause the interest payable on the Note to be
19 included in gross income for federal income tax purposes. Without limiting the generality
20 of the foregoing, the City covenants with the Owner that the proceeds of the sale of the
21 Note will not be used directly or indirectly in such manner as to cause the Note to be
22 treated as an "arbitrage bond" within the meaning of section 148 of the Internal Revenue
23 Code of 1986, as amended (the "Code ").
24 (b) The City will not use or permit the use of the Property or the proceeds of the
25 Note in such manner as to cause the Note to be a "private activity bond" within the
26 meaning of section 141 of the Code.
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1 (c) None of the gross proceeds of the Note will be used (directly or indirectly) either
2 (i) to make or finance loans to persons other than state or local governmental units or (ii) in
3 any trade or business carried on by any person other than a state or local governmental
4 unit or other than as a member of the general public.
5 (d) The City will take no action which would cause the Note to be "federally
6 guaranteed" within the meaning of the Code.
7 (e) The City will not reimburse itself from Note proceeds for any costs paid prior to
8 the date the Note is issued except in compliance with United States Treasury Regulation
9 § 1.150 -2. This Ordinance shall constitute an "official intent" for purposes of the Regulation.
10 (f) The City will submit to the Secretary of the Treasury of the United States, not
11 later than the 15th day of the second calendar month after the close of the calendar quarter
12 in which the Note is issued, a statement concerning the Note which contains the
13 information required by section 149(e) of the Code.
14 Section 6. The City shall provide such financial information to the Lender as the
15 Lender may reasonably request.
16 Section 7. The Mayor, City Clerk, and City Treasurer, for and on behalf of the City,
17 are hereby authorized and directed to do any and all things necessary to effect the issuance,
18 execution, and delivery of the Note, and the performance of all acts of whatever nature
19 necessary to effect and carry out the authority conferred by this Ordinance. The Mayor,
20 City Clerk, and City Treasurer are hereby further authorized and directed, for and on
21 behalf of the City, to execute all papers, documents, certificates, and other instruments that
22 may be required for the carrying out of such authority or to evidence the exercise thereof.
23 Section 8. Severability. In the event any title, section, paragraph, item, sentence,
24 clause, phrase, or word of this ordinance is declared or adjudged to be invalid or
25 unconstitutional, such declaration or adjudication shall not affect the remaining portions of
26 this ordinance, which shall remain in full force and effect as if the portion so declared or
27 adjudged invalid or unconstitutional was not originally a part of this ordinance.
[PAGE 4 OF 7]
1 Section 9. Repealer. All ordinances or resolutions of the City in conflict herewith are
2 hereby repealed to the extent of such conflict.
3 PASSED: March 1, 2005
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4 ATTEST: APPROVED:
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7 Nanc Wood, ity Clerk Jim iley, Mayor
8
9 APPROVED AS TO LEGAL FORM:
10
12 Thomas M. Carpenter, City A torney
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Schedule A
2005 Short -term Financing Detail
March 1, 2005
Vehicles (tentative allocation):
Public Works
$ 616,000
Police
680,000
Fire
715,000
Parks
177,000
Fleet
85,000
Planning
42,000
Housing
35,000
Total Vehicles
$ 2,330,000
Facilities and Land:
Fleet Roof
$ 150,000
Fleet Paint Shop
200,000
Zoo Penguin Exhibit
600,000
Alert Center Reconstruction
130,000
State and LaHarpe property
150,000
Bike & Running Trail Land
500,000
City Hall Renovation
350,000
Southwest Police HVAC
85,000
Street Operations Roof
50,000
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Central Fire Station Windows
Total Facilities and Land
Technology and Equipment:
Network Tape Drive Backup System
Servers (2)
Computers, scanners, printers
Radios (6)
Defibrillators (12)
Print Shop Equipment
Total Technology and Equipment
Total Projects
Issuance Costs
Estimated Note Issue
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15,000
$ 2,230,000
$ 39,000
12,000
264,000
14,000
15,000
15,000
$ 359,000
$ 4,919,000
11,000
4,930,000