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HomeMy WebLinkAbout14247M M M M 268 ORDINANCE NO. 14,247 AN ORDINANCE AUTHORIZING THE SALE AND ISSUANCE OF TEMPORARY AIRPORT REVENUE BONDS; AUTHORIZING THE REOFFERING FOR PUBLIC SALE OF AIRPORT REVENUE BONDS PREVIOUSLY AUTHORIZED; PRESCRIBING OTHER MATTERS RELATING THERETO; AND DECLARING AN EMERGENCY. WHEREAS, the City of Little Rock, Arkansas (the "City "), acting through its Board of Directors (the "Board ") upon the recommendation of the Little Rock Municipal Airport Commission (the "Commission "), has adopted Ordinance No. 13,884, as amended by Ordinance No. 13,899 (Ordinance No. 13,884, as so amended, will be hereafter referred to as the "Permanent Bond Ordinance "); and WHEREAS, the City has determined that the Permanent Bonds cannot be issued at this time due to market conditions; and WHEREAS, the Permanent Bond Ordinance authorized the issuance of $1,500,000 City of Little Rock, Arkansas Airport Revenue Bonds, Series 1980 (the "Permanent Bonds ") for the purpose of financing certain improvements to the Little Rock Municipal Airport, consisting of reroofing of the Timex building, reroofing of the old airport terminal, expanding of the Air Cargo building and constructing a vehicle maintenance and storage facility (the "Project "); and WHEREAS, the Permanent Bond Ordinance provided that the Permanent Bonds would be offered for public sale on sealed bids which would be received until 10:30 a.m. on October 29, 1980, and bids were received at that time but, with the advice and consent of the Commission, all bids were rejected; and WHEREAS, the Commission has requested authority to reoffer the Permanent Bonds for public sale at a later time when the bond market has improved so as to permit the sale of the Permanent Bonds at acceptable interest rates; and WHEREAS, pending the sale and issuance of the Permanent Bonds, the City has sold and issued its Temporary Airport Revenue Bond, dated January 21, 1981, maturing January 21, 1982, in the principal amount of not to exceed $600,000 (the "1981 Bond "), so as to enable the Commission to proceed with the Project; and WHEREAS, the actual principal amount of the 1981 Bond is $200,000, such 1981 Bond is overdue, and it is now necessary that the City sell and issue its Temporary Airport Revenue Bond in the principal amount of not to exceed $600,000 (the "Temporary Bond "), 269 so as to refinance the outstanding principal balance of the 1981 Bond and so as to enable the Commission to continue with the Project; and WHEREAS, necessary arrangements have been made for the sale and issuance of the Temporary Bond to Commercial National Bank of Little Rock, The First National Bank in Little Rock and Worthen Bank &,Trust Company, N.A. (with the Temporary Bond to be sold and issued to Commercial National Bank of Little Rock, which will be hereafter referred to as the "Purchaser," and with the other two banks to participate in accordance with an agreement among the banks), at a price equal to 100% of the principal amount thereof; NOW, THEREFORE, BE IT ORDAINED by the Board of Directors of the City of Little Rock, Arkansas: Section 1. The Permanent Bonds shall be reoffered for public sale at such future time or times as the Commission, with the advice of the City's Director of Finance and Administration, shall determine as appropriate in order to market the Permanent Bonds with acceptable interest rates. The Permanent Bonds shall be advertised for sale and the sale shall be authorized by resolution of the Board, as provided in Section 1 of the Permanent Bond Ordinance. A sufficient amount of the proceeds of the Permanent Bonds will be applied to the retirement of the Temporary Bond as hereafter provided. The Permanent Bond Ordinance, as herein supplemented, shall continue in full force and effect. Section 2. The Temporary Bond is hereby authorized and ordered issued and the proceeds thereof shall be used by the Commission for paying the costs of accomplishing the Project or such portion thereof as the Commission shall determine. The Temporary Bond shall be sold to the Purchaser for a purchase price of 100% of the principal amount thereof, but the purchase price shall be paid in multiple advances as moneys are needed for payment of Project costs as determined by the Commission. The amount of each advance shall bear interest from the date of advance until paid at the rate or rates of interest determined as hereafter provided in the form of Temporary Bond set out in Section 4 hereof. The Temporary Bond shall be dated as of the date of the first advance and shall mature one year from date. Interest shall be payable quarterly, commencing three (3) months after the date of the Temporary Bond. Section 3. The Temporary Bond shall be executed on behalf of the City by the Mayor and City Clerk and shall have impressed thereon the seal of the City. The Temporary Bond will not be a general obligation of the City but will be a special obligation payable solely from revenues derived from the K M M M M M r i 9 270 operation of the Airport and from the proceeds of the Permanent Bonds and will not constitute an indebtedness of the City within any constitutional or statutory limitation. The pledge of Airport revenues to the Temporary Bond is subject to a prior and superior pledge of Airport revenues to the presently outstanding bonds payable from Airport revenues (described in the Temporary Bond form and hereafter referred to as the "Prior Issues "). A special fund is hereby created and designated "Temporary Airport Revenue Bond Fund" (the "Bond Fund ") and the revenues required by the provisions of this Ordinance to be placed into the Bond Fund are hereby pledged and mortgaged for the payment of the Temporary Bond, all in accordance with the provisions of this Ordinance. Section 4. The Temporary Bond shall be in substantially the following form, and the Mayor and City Clerk are hereby expressly authorized and directed to make all covenants and recitals contained therein: � M M M M M M Ll � M 271 UNITED STATES OF AMERICA STATE OF ARKANSAS COUNTY OF PULASKI CITY OF LITTLE ROCK TEMPORARY AIRPORT REVENUE BOND KNOW ALL MEN BY THESE PRESENTS: $600,000 That the City of Little Rock, County of Pulaski, and State of Arkansas (the "City "), acknowledges itself to owe and, for value received, hereby promises to pay to Commercial National Bank of Little Rock, or assigns (the "Payee "), one year from the date hereof, the total principal outstanding as shown by the Record of Payment of Advances attached hereto, but not to exceed the principal sum of SIX HUNDRED THOUSAND DOLLARS in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of debts due the United States of America, and to pay, in like coin or currency, interest thereon from the date of each advance at the rate hereafter specified. Interest shall be payable three months, six months and nine months from the date hereof, and'at maturity. This Bond shall bear interest at a rate per annum equal to 75% of the prime commercial lending rate of Commercial National Bank of Little Rock as announced from time to time by such bank; provided, however, this Bond shall not bear interest during any period at a rate per annum greater than the statutory rate (hereby defined as the rate per annum that is 1% in excess of the discount rate then in effect on 90 -day commercial paper at the Federal Reserve Bank of St. Louis). If at any time a rate of interest provided for herein shall exceed the statutory rate, thereby causing the interest hereon to be limited to the statutory rate as provided herein, any subsequent reduction in the prime rate of Commercial National Bank of Little Rock shall not reduce the rate of interest below the statutory rate until the total amount of interest accrued on the Bond equals the amount of interest which would have accrued thereon if the rate of interest had not been so limited to the statutory rate. Payments of interest shall be made by check mailed by first class mail to the Payee. Payment of the principal hereof shall be made upon presentation and surrender of this Bond to the City. This Bond is being issued for the purpose of financing improvements to the Little Rock Municipal Airport, and is issued pursuant to and in full compliance with the Constitution and laws moo MM M M M M M M r 0 M M M M 272 of the State of Arkansas, including particularly Act No. 53 of the Acts of Arkansas for the year 1949, as amended, and Act No. 175 of the Acts of Arkansas for the year 1959, as amended, and pursuant to Ordinance No. , adopted and approved on the day of 1982 (the "Authorizing Ordinance ") and the Bond does not constitute an indebtedness of the City within any constitutional or statutory limitation. This Bond is not a general obligation of the City but is a special obligation payable solely from revenues derived from the operation of the Municipal Airport. The pledge of Airport revenues in favor of this Bond is subject to prior and superior pledges of Airport revenues to the outstanding Municipal Airport Revenue Bonds, dated May 1, 1966, March 1, 1971, March 1, 1975, March 1, 1976, and November 1, 1977 (collectively the "Prior Issues "). A special fund has been created by and identified in the Authorizing Ordinance as the "Temporary Airport Revenue Bond Fund" (the "Bond Fund "), and reference is hereby made to the Authorizing Ordinance for a detailed statement of the nature and extent of the security and of the rights and obligations of the City and Payee, including, without limitation, the covenant of the City to impose and collect such charges for the use of the Airport and its facilities as will always produce sufficient revenues to provide for the operation, maintenance and repair of the Airport, to provide for the payment of the principal of and interest on the Prior Issues and the interest on this Bond, as the same become due (there is no provision for required deposits out of the revenues into the Bond Fund for the payment of principal of this Bond prior to maturity, but the City hereby covenants that it will, on or before the maturity date of this Bond, issue permanent bonds in a sufficient amount and use the proceeds thereof to pay the principal hereof), for making the required deposit for depreciation and for maintaining all funds at required levels, all in accordance with the provisions of the ordinances authorizing the Prior Issues and the Authorizing Ordinance. The principal of this Bond shall be subject to prepayment prior to maturity at the option of the City, in whole but not in part, at a price of 100% of the outstanding principal hereof plus interest accrued and unpaid thereon, from funds from any source, at any time. Notice of prepayment shall be given at least fifteen (15) days prior to the date fixed for such prepayment by first class mail to the Payee specifying the amount and date of such prepayment. This Bond may be assigned, and upon such assignment, the assignor shall promptly notify the City by registered mail, and the assignee shall surrender the same to the City in exchange for a new Bond of like tenor and effect. Every assignee shall take this 5 273 Bond subject to all payments and prepayments of principal and interest. IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of this Bond, have existed, have happened and have been performed in due time, form and manner, as required by law; that the indebtedness represented by this Bond does not exceed any constitutional or statutory limitation; and that sufficient revenues have been pledged to and will be set aside for the payment of the principal of and interest on the Bond. IN WITNESS WHEREOF, the City of Little Rock, Arkansas, by its Board of Directors, has caused this Bond to be signed by the Mayor and City Clerk thereof and sealed with the seal of the City, all as of the day of , 1982, which is the date of the first advance and the date of this Bond. ATTEST: Jane Czech (SEAL) CITY OF LITTLE ROCK, ARKANSAS By /s/ Charles Bus Mayor 0 274 RECORD OF PAYMENT OF ADVANCES Signature of Manager, Amount of Total Principal Little Rock Municipal Date of Advance* Advance Outstanding Airport *The date of each advance shall be the interest commencement date from which the principal amount of such advance bears interest. 7 Section 5. That the City and the Commission hereby covenant with the Payee of the Temporary Bond that there will be imposed and collected such charges for the use of the Airport and its facilities as will at all times produce sufficient revenue& -at least to provide for operation, maintenance and repair expenses of the Airport, to provide for the payment of the principal of and interest on all bonds of the Prior Issues, and for the payment of interest on the Temporary Bond, as the same become due, to provide for Paying Agent's fees, to make the required deposits for depreciation, and to maintain all funds at required levels, all as .set forth in the ordinances authorizing such bonds. The above covenant shall include the agreement and obligation to increase the charges from time to time as and to the extent necessary to produce sufficient revenues to meet the above requirements. Section 6. All funds created by Ordinances of the City authorizing and securing the outstanding bonds of the Prior Issues shall remain unchanged by this Ordinance and shall continue to be maintained by the City as required by and pursuant to the provisions of said Ordinances. Also, all of the covenants, restrictions, conditions and provisions set forth in said Ordinances, except where expressly inconsistent with the provisions of this Ordinance, are hereby, each and all, ratified and confirmed, and shall continue in force and inure to the security and benefit of the Temporary Bond, as fully and as effectively as if herein set out in full, it being the intention of this section to give the Temporary Bond the full benefit of all such covenants, restrictions, conditions and provisions as well as the full benefits of all applicable provisions of the Constitution and laws of the State of Arkansas, and of this Ordinance, subject to the priority of pledge in favor of the Prior Issues. Section 7. Temporary Airport Revenue Bond Fund. (a) There is hereby established with a bank or banks, holding membership in the Federal Deposit Insurance Corporation, to be designated by the Commission from time to time, a special trust fund in the name of the City designated "Temporary Airport Revenue Bond Fund" (the "Bond Fund ") which shall be maintained as long as the Temporary Bond is outstanding and unpaid, and into which there shall be paid the sums in the amounts and at the times hereinafter set forth in subparagraph (b) for the purpose of providing funds for the payment of the interest on the Temporary Bond. (b) Beginning on the first business day of the first month after the delivery of the Temporary Bond and continuing on the first business day of each month thereafter there shall be paid into the Bond Fund from Airport revenues a sum equal to one- E: 275 t, 276 third (1/3) of the estimated amount of the next installment of interest. Additional amounts of Airport revenues shall be deposited into the Bond Fund as and to the extent necessary to provide moneys sufficient to pay interest on the Temporary Bond as due. Section 8. The principal of the Temporary Bond shall be subject to prepayment in accordance with the terms set out in the face of the Bond form in Section 4 of this Ordinance. Section 9. So long as the Temporary Bond is outstanding the City shall continuously operate the Airport as a revenue - producing undertaking and shall not issue or attempt to issue any bonds or incur any obligations claimed to be entitled to a priority of pledge of, Airport revenues over the pledge in favor of the Temporary Bond, including revenues derived from the herein authorized and any and all future improvements to the Airport. Furthermore, the City shall not authorize or issue any additional bonds or incur any additional obligations ranking on a parity of security with the Temporary Bond. Section 10. (a) If there be any default in the payment of the principal of or interest on the Temporary Bond, or if the City defaults in any Bond Fund requirements or in the performance of any covenants set forth in this ordinance, the Payee may by proper suit compel the performance of the duties of the officials of the City under the Constitution and laws of the State of Arkansas and under this ordinance. Any, in the case of a default in the payment of the principal of or interest on any Temporary Bond the Payee may apply in a proper action to a court of competent jurisdiction for the appointment of a receiver to administer the Airport on behalf of the City with power to charge and collect (or by mandatory injunction or otherwise to cause to be charged and collected) rates sufficient to provide for the payment of the expenses of operation, maintenance and repair, to pay principal and interest on the bonds of the Prior Issues and the Temporary Bond and to apply the revenues in conformity with the Constitution and laws of the State of Arkansas and with the provisions of this ordinance. When all defaults in principal and interest payments have been cured, the custody and operation of the Airport shall revert to the City. (b) No remedy herein conferred upon or reserved to the Payee is intended to be exclusive of any other remedy or remedies herein provided, and each and every such remedy shall be cumulative and shall be in addition to every other remedy. (c) No delay or omission of the Payee to exercise any right or power accrued upon any default shall impair any such right or power or shall be construed to be a waiver of any such 9 t. 277 default or an acquiescence therein; and every such power and remedy given by this ordinance to the Payee may be exercised from time to time and as often as may be deemed expedient. (d) No waiver of a default hereunder shall extend to or affect any other existing or any subsequent default or defaults or impair any rights or remedies consequent thereon. Section 11. That after the Temporary Bond has been executed by the Mayor and City Clerk and the seal of the City impressed as herein provided, the Manager of the Little Rock Municipal Airport shall endorse the Record of Payment of Advances to reflect the first advance. The Temporary Bond shall be delivered to Commercial National Bank of Little Rock in exchange for the 1981 Bond, which shall be canceled. The Record of Payment of Advances attached to the Temporary Bond shall be endorsed, as of the date of its delivery, to show that the first advance is $200,000 (being the principal amount of the 1981 Bond exchanged for the Temporary Bond) , and the accrued interest on the 1981 Bond shall be paid in cash. Subsequent advances shall be made from time to time upon notice by the Commission and the Airport Manager shall endorse the Record of Payment of Advances to reflect each advance. All proceeds of the Temporary Bond (all such advances) shall be remitted to the Treasurer of the Commission and the Treasurer shall deposit the proceeds in a special account in the name of the Commission designated "Little Rock Municipal Airport Commission 1980 Construction Fund" in a bank that is a member of the Federal Deposit Insurance Corporation. The moneys in the Construction Fund shall be disbursed solely for paying the cost of accomplishing the Project and paying expenses incurred in connection with the authorization and issuance of the Temporary Bond. Moneys held in the Construction Fund may, at the option of and pursuant to the direction of the Commission, be invested and reinvested in direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, in obligations of agencies of the United States of America, or Bank Certificates of Deposit which shall mature, or which shall be subject to redemption by the holder thereof, at the option of the holder, not later than the date or dates when the moneys held for the credit of the Construction Fund will be required for accomplishing the Project, as determined by the Commission in its discretion. Any profit realized from investment of moneys in the Construction Fund may be used by the Commission for any lawful purpose. Section 12. The City expressly covenants with the Payee that it will, on or prior to the maturity date of the Temporary Bond, issue the Permanent Bonds and apply a sufficient amount of the proceeds thereof to retire, on or prior to maturity, the Temporary Bond. 10 v v v m Section 13. It is understood and agreed that the Commission, acting for and on behalf of the City, has custody of and control over the Airport, operates, maintains and repairs the Airport and collects and handles Airport revenues. Therefore, it is understood and agreed that all references herein to the City shall, when appropriate in view of the authority and responsibility of the Commission, be construed to include the Commission. To this end, the Commission, by resolution, has expressly adopted and approved this Ordinance and the provisions hereof and has thereby agreed to perform all covenants and obligations with reference to the Airport and Airport revenues, set forth herein, the performance of which are within its authority and jurisdiction. Section 14. The provisions of this Ordinance are hereby declared to be separable and if any provision shall for any reason be held illegal or invalid, such holding shall not affect the validity of the remainder of the Ordinance. Section 15. That all ordinances, resolutions and parts thereof in conflict herewith are hereby repealed to the extent of such conflict. Section 16. That there is hereby ascertained and declared that an immediate need exists for the Project to be financed from the proceeds of the Temporary Bond, in order to have adequate facilities at the Airport. It is, therefore, declared that an emergency exists, and this Ordinance being necessary for the immediate preservation of the public peace, health and safety, shall take effect and be in force from and after its passage. PASSED: May 18, 1982, APPROV . ATTEST: 6 /Lt Mayor City Cle-rRf (SEAL) 11 278