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1991-12-16 Extract of Minutes . ! Extract of Minutes of Meeting of the City Council of the City of Albertville Wright County, Minnesota Pursuant to due call and notice thereof, a regular meeting of the Gity Council of the City of Albertville, Minnesota, was duly held in the City Hall in the City of - Albertville on Monday, December 16, 1991, commencing at 7:30 p.m. The following members were present: Walsh, Potter, Berning and Barthel and the following were absent: Vetsch * * * * * * * * * The Mayor announced that the next item of business was .the consideration of a proposal for the purchase of $95,000 General Obligation Improvement Bonds, Series 1991B of the City. The City Clerk-Treasurer presented an offer of Security Bank Northwest, St. Michael, Minnesota, to purchase the Bonds which had been submitted to the City pursuant to Council direction. After due consideration of the proposal, Councilmember Berninq introduced the following resolution and moved its adoption: RESOLUTION NO. A RESOLUTION AWARDING THE SALE OF $95,000 GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 1991B FIXING THEIR FORM AND SPECIFICATIONS; DIRECTING THEIR ISSUANCE AND DELIVERY; AND PROVIDING FOR THEIR PAYMENT ,., " BE IT RESOLVED By the City Council of the City of Albertville, Wright County, Minnesota (City) as follows: DJK26504 AL141-8 Sec~ion 1. Background: findings. 1. 01. It is hereby determined that: (a) the following assessable public improvements (the Improvem~nts) have been made, duly ordered or contracts let for the construction thereof, by the City pursuant to the provisions of Minnesota Statutes, Chapter 429 (Act): Project Designation & Description: Parks edge Project Total Project Cost Construction Engineering Legal, fiscal, administrative City Planner Capitalized Interest Total $ 60,190 17,500 7,500 2,500 7,310 $ 95, 000 1 .02. It is determined that it is necessary and desirable for the sound financial management of the City that the City issue and sell its General Obligation Improvement Bonds, Series 1991B (Bonds) pursuant to the Act to finance all or a portion of the Costs. 1. 03. The City is authorized by Minnesota Statutes, Section 475.60, Subdivision 2(a) to negotiate the sale of the Bonds it being determined that the City has not issued and sold more than $1,200,000 in Bonds in the past twelve month period. The actions of the City Staff in negotiating the sale of the Bonds are ratified and confirmed in all aspects. Section 2. Sale of Bonds. 2.01. The offer ,of Security Bank Northwest, St. Michael, Minnesota (Purchaser )to purchase the Bonds is found to be a reasonable offer and is accepted, the offer being to purchase the Bonds at a price of par for Bonds bearing interest at the rate of 7.00% per annum to maturity. 2.02. The City shall forthwith issue and sell the Bonds to the Purchaser in the total principal amount of $95,000. The Bonds shall be originally dated as of delivery to the Purchaser, in the denomination of $95,000, and will mature on August 1, in the years and installment amounts as follows: Year Amount Year Amount 1992 $ 5,000 1997 $10,000 1993 10,000 1998 10,000 1994 f., 10,000 1999 10,000 1995 10,000 2000 10,000 1996 10,000 2001 10,000 DJK26504 AL141-8 2.03. Optional Redemption. The City may elect on any date to prepay the Bonds in increments of $10,000 in whole or in part at a price of par plus accrued interest to date of redemption. If redemption is in part those installments having the late,st maturity date will be prepaid first. Section 3. Registration. 3.01.. Registered Form. The Bonds shall be issued as a single typewritten bond, only in fully registered form. The interest thereon and, upon surrender of each Bond, the principal amount thereof, shall be payable by check or draft issued by the Registrar described herein. 3.02. Dates; Interest Payment Dates. The Bond shall be dated as of the last interest payment date preceding the date of authentication to which interest on the Bond has been paid or made available for payment, unless (i) the date of authentication is an interest payment date to which interest has been paid or made available for payment, in which case such Bond shall be dated as of the date of authentication, or (ll,) the date of authentication is prior to the first interest payment date, in which case such Bond shall be dated as of the date of original issue. The interest on the Bonds shall be payable on February 1 and August 1 of each year, commencing February 1, 1992, to the owner of record thereof as of the close of business on the fifteenth day of the immediately preceding month, whether or not such day is a business day. 3.03. Registration. The City appoints the City Clerk-Treasurer as Bond Registrar. The effect of registration and the rights and duties of the City and the Registrar with respect thereto shall be as follows: (a) Register. The Registrar shall keep a bond register in which the Registrar shall provide for the registration of ownership of Bonds and the registration of transfers and exchanges of Bonds entitled to be registered, transferred or exchanged. (b) Transfer of Bonds. Upon surrender for transfer of the Bonds duly endorsed by the registered owner thereof or accompanied by a written instrument of transfer, in form satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar shall deliver, in the name of the designated transferee or transferees, one or more new Bonds of a like aggregate principal amount and maturity, as requested by the transferor. The Registrar may, however, close the books for registration of any transfer after the fifteenth day of the month preceding each interest payment date and until such interest payment date. (c) Exchange of Bonds. Whenever any Bonds are surrendered by the registered owner for exchange the Registrar shall deliver one or more new Bonds of a like aggregate principal amount and maturity, as requested by the registered owner or the owner's attorney in writing. (d) i/ Cancellation. All Bonds surrendered upon any transfer or ex- change sha.ll be promptly cancelled by the Registrar and thereafter disposed of as directed by the City.. . DJK26504 AL141-8 (e) Improper or Unauthorized Transfer. When any Bond is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on such Bon,d or separate instrument of transfer is valid and genuine and that the requested transfer is legally authorized. The Registrar shall incur no liability for the refusal, in good faith, to make transfers which it, in its judgment, deems improper or unau thorized . . (f) Persons Deemed Owners. The City and the Registrar may treat the person in whose name any Bond is at any time registered in the bond register as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on such Bond and for all other purposes, and all such payments so made to any such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid. (g) . Taxes, Fees and Charges. For every transfer or exchange of Bonds, the Registrar may impose a charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee or other governmental charge required to be paid with respect to such transfer or exchange. (h) Mutilated, Lost, Stolen or Destroyed Bonds. In case any Bond shall become mutilated or be destroyed, stolen or lost, the Registrar shall deliver a new Bond of like amount, number, maturity date and tenor in exchange and substitution for and upon cancellation of any such mutilated Bond or in lieu of and in substitution for any such Bond destroyed, stolen or lost, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a Bond destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to it that such Bond was destroyed, stolen or lost, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance and amount satisfactory to it, in which both the City and the Registrar shall be named as obligees. All Bonds so surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be given to the City. If the mutilated, destroyed, stolen or lost Bond has already matured or been called for redemption in accordance with its terms it shall not be necessary to issue a new Bond prior to payment. (i) Redemption. In the event the Bonds are called for redemption, notice thereof will be given by the Registrar by mailing a copy of the redemption notice by first class mail (postage prepaid) not more than 120 and not less than 90 days prior to the date fixed for redemption to the registered owner of the Bonds to be redeemed at the address shown on the registration books kept by the Registrar. The Bonds when so called for redemption will cease to bear interest after the specified redemption date ,provided that the funds for the redemption are on deposit with the place of payment at that time. 3.04. Execution and Delivery. The Bonds shall be prepared under the direction of the ~lerk-Treasurer and shall be executed on behalf of the City by the signatures of the Mayor' and the Clerk-Treasurer. In case any officer whose signature shall appear on the Bonds shall cease to be such officer before the delivery of the Bonds, such signature shall nevertheless be valid and sufficient for all pur- DJK26504 AL141-8 ( poses, the same as if the officer had remained in office until delivery. When the Bonds have been so prepared, executed the Clerk-Treasurer shall deliver the same to the Purchaser thereof upon payment of the purchase price and the Purchaser shall not be obligated to see to the application of the purchase price. Section 4. Form of Bond. 4.01. The Bond shall be typewritten in substantially the following form: UNITED STATES OF AMERICA ST A TE OF MINNESOTA COUNTY OF WRIGHT CITY OF ALBERTVILLE GENERAL OBLIGATION IMPROVEMENT BOND, SERIES 1991B No. R-1 $95,000 The City of Albertville, Minnesota, a duly organized and existing municipal corporation in Wright County, Minnesota (City), acknowledges itself to be indebted and for value received hereby promises to pay to Security Bank Northwest of St. Michael, Minnesota, or registered assigns, the principal sum of $95,000 on August 1 in the years and installment amounts as follows: Year Installment Year Installment 1992 $ 5, 000 1997 $10,000 1993 10,000 1998 10, 000 1994 10,000 1999 10,000 1995 10,000 2000 10,000 1996 10,000 2001 10,000 with interest thereon from the date hereof at the annual rate of 7.00%, payable February 1 and August 1 in each year, commencing February 1, 1992. For the prompt and full payment of such principal and interest as the same respectively become due, the full faith and credit and taxing powers of the City have been and are hereby irrevocably pledged. The City may elect on any date to prepay this Bond in increments of $10,000 in whole or in part at a price of par plus accrued interest to date of redemption. If redemption is in part, those installments having the latest maturity date will be prepaid first. Notice of redemption will be mailed to the registered owners as provided in the Resolution described herein. This Bond is issued pursuant to a resolution adopted by the City Council on December 16, 1991 (Resolution), for the purpose of providing money to defray the expenses incurred and to be incurred in making local improvements, pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Chapter 429, and the principal hereof and interest hereon are payable primarily from special assessments against property specially benefitted by local improvements as set forth in the Resolution to which reference is made for a full DJK26504 AL141-8 statement of rights and powers thereby conferred.. The full faith and credit of the City are il'revocably pledged for payment of this IBond and the City Council has obligat~d itself to levy ad valorem taxes on all taxljlble property in the City in the event of any deficiency in special assessments pledged, which taxes may be levied without limitation as to rate or amount. i , The City Council has designated the Bonds as "qualified tax exempt obliga- tions" within the meaning of Section 265(b) (3) of th~ Internal Revenue code of 1986, as amended (the Code) relating to disallowance of interest expense for financial institutions and within the $10 million limit allowed b&, the Code for the calendar year of issue. As provided in the Resolution and subject ito certain limitations set forth therein, this Bond is transferable upon the books of the City at the principal office of the Bond Registrar , by the registered owner hereof in person or by the owner's attorney duly authorized in writing upon surrender hereof together with a written instrument of .transfer satisfactory to the Bond R~gistrar, duly executed by the registered owner or the owner's attorney; and may $.lso be surrendered in exchange for Bonds of other authorized denominations. Upon such transfer or exchange the City will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of the same aggregate principallamount, bearing interest at the same rate and maturing on the same date, subject tq reimbursement for any tax, fee or governmental charge required to be paid wi~h respect to such transfer or exchange. I The City and the Bond Registrar may deem a~d treat the person in whose name this Bond is registered as the absolute owner hereQf, whether this Bond is overdue or not, for the purpose of receiving payment and for all other purposes, and neither the City nor the Bond Registrar shall be affected 1I>y any notice to the contrary. IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to bel performed preliminary to and in the issuance of this Bond in order to make it a vali<li and binding general obligation of the City in accordance with its terms, have been done, do exist, have happened and have been performed as so required, and that t~e issuance of this Bond does not cause. the indebtedness of the City to exceed . ny constitutional or statutory limitation of indebtedness. IN WITNESS WHEREOF, the City of Albertvill , Wright County, Minnesota, by its City Council, has caused this Bond to be exec ted on its behalf by the manual signatures of the Mayor and City Clerk-Treasure and has caused this Bond to be dated as of the date set forth below. Dated: $A-"'pU11.&;, 19'1~ F ALBERTVILLE, MINNESOTA DJK26504 AL141-8 \, Date of . Registration Registered Owner Signature of Clerk-Treasurer Security Bank Northwest St. Michael, Minn!3sota Federal Employer ID No. If any payment of principal or interest on the Bonds becomes due when there is not sufficient money in the Debt Service Fund to pay the same, the Clerk-Treasurer must pay the principal or interest from the general fund of the City, and the general fund may be reimbursed for such advances out of the proceeds of Assessments when collected. 5.02. There is appropriated to the Debt Service Fund all capitalized interest funded from Bond proceeds, if any and any accrued interest paid by the Purchaser upon closing and delivery of the Bonds. 5.03. The Clerk-Treasurer is directed to file a certified copy of this resolution with the County Auditor and obtain the certificate required by Minnesota Statutes, Section 475.63. 5.04. It is hereby determined that the estimated collections of Assessments and interest thereon for payment of principal and interest on the Bonds will produce at least five percent in excess of the amount needed to meet when due, the principal and interest payments on the Bonds and that no tax levy is needed at this time. 5.05. It is hereby determined that the Improvements to be financed by the Bonds will directly and indirectly benefit the abutting property, and the City covenants with the holders from time to time of the Bonds as follows: (a) The City has caused or will cause the Assessments for the Im- provements to be promptly levied so that the first installment will be collectible not later than 1992 and will take all steps necessary to assure prompt collection, and the levy of the Assessments is hereby authorized. The City Council will cause all further actions and proceedings relative to the making and financing of the Improvements financed hereby to be taken with due diligence that are required for the construction of each Improvement financed '9holly or partly from the proceeds of the Bonds, and for the final and valid levy of the Assessments and the appropriation of any other funds needed to pay the Bonds and interest thereon when due. DJK26504 AL141-8 - . (b) In the event of any current or anticipation deficiency in the Assessments the City Council will levy ad valorem taxes in the amount of said current or anticipated deficiency. (c) The City will keep complete and accurate books and records showing: all receipts and disbursements in connection with the Improve- ments, Assessments levied therefor and other funds appropriated for their payment, all collections thereof and disbursements therefrom, moneys on hand and, the balance of unpaid Assessments. (d) The City will cause its books and records to be audited at least annually and will furnish copies of such audit reports to any interested person upon request. Section 6. Tax Covenant. 6.01. The City covenants and agrees with the holders from time to time of the Bonds that it will not take or permit to be taken by any of its officers, employees or agents any action which would cause the interest on the Bonds to become subject to taxation under the Internal Revenue Code of 1986, as amended (the Code), and the Treasury Regulations promulgated thereunder, in effect at the time of such actions, and that it will take or cause its officers, employees or agents to take, all affirmative action within its power that may be necessary to ensure that such interest will not become subject to taxation under the Code and applicable Treasury regulations, as presently existing or as hereafter amended and made applicable to the Bonds. 6.02. (a) The City will comply with requirements necessary under the Code to establish and maintain the exclusion from gross income of the interest on the Bonds under Section 103 of the Code, including without limitation requirements relating to temporary periods for investments, limitations on amounts invested at a Yield greater than the yield on the Bonds, and the rebate of excess investment earnings to the United States if the Bonds (together with other obligations reasonably expected to be issued in calendar year 1991) exceed the small-issuer exception amount of $5,000,000. (b) For purposes of qualifYing for the small issuer exception to the federal arbitrage rebate requirements, the City finds, determines and declares that the aggregate face amount of all tax-exempt bonds (other than private activity bonds) issued by the City (and all subordinate entities of the City) during the calendar year in which the Bonds are issued and outstanding at one time is not reasonably expected to exceed $5,000,000, all within the meaning of Section 148 (f) (4) (G) of the Code. 6.03. The City further covenants not to sue the proceeds of the Bonds or to cause or permit them or any of them to be used, in such a manner as to cause the Bonds to be "private activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code. 6.04. In order to qualify the Bonds as "qualified tax-exempt obligations" within the meanip.g of Section 265 (b) (3) of the Code, the City makes the following factual statements and representations: (a) the Bonds are not "private activity bonds" as defined in Section 141 of the Code; PJK26504 AL141-8 , ~ i \ (b) the City hereby designates the Bonds as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Code; (c) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds, treating qualified 501 (c) (3) bonds as not being private activity bonds) which will be issued by the City (and all subordinate entities of the City) during calendar year 1991 will not exceed $10,000,000; and (d) not more than $10,000,000 of obligations issued by the City during calendar year 1991 have been designated for purposes of Section 265(b)(3) of the Code. 6.05. The City will use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designations made by this section. 6.06. The City has structured this issue of Bonds and the Assessments pledged to their payment in such a way as to schedule payment of as much debt service as is practicable in each year before the call, date. It is anticipated that there will be substantial prepayments of the Assessments during the first four years of the maturity schedule of the Bonds, and those prepayments will be applied to the redemption of the Bonds at the earliest possible date. Section 7. Authentication of Transcript. 7.01. The officers of the City are hereby authorized and directed to prepare and furnish to the Purchaser and to the attorneys approving the Bonds, certified copies of proceedings and records of the City relating to the Bonds and to the financial condition and affairs of the City, and such other certificates, affidavits and transcripts as may be required to show the facts within their knowledge or as shown by the books and records in their custody and under their control, relating to the validity and marketability of the Bonds and such instruments, including any heretofore furnished, shall be deemed representations of the City as to the facts stated therein. . 7.02. It is determined that no comprehensive Official Statement or offering material has been prepared or circulated by the City in connection with the saleof the Bonds and that the City is relying on the investment representation of the Purchaser in an investment letter of even date now on file with the Clerk-Treasurer. r, DJK26504 ALl4.l.a