Explanation
This ordinance authorizes the issuance of limited tax bonds in the amount of not to exceed $3,050,000 for housing projects. This bond sale will be conducted on a competitive basis and is a cooperative effort of the Department of Finance and Management and the City Auditor's Office.
Title
To authorize the issuance of limited tax bonds in the amount of not to exceed $3,050,000 for housing projects ($3,050,000)
Section 55(B) of the City Charter.
Body
WHEREAS, it is now deemed necessary to issue and sell up to $3,050,000 of bonds under authority of the general laws of the State of Ohio, and in particular Section 133.23 of the Ohio Revised Code, for the purpose of facilitating housing preservation, promoting housing renovation and encouraging the improvement of housing stock within the City of Columbus, including providing funds for (i) providing assistance for the renovation and improvement of homes owned or to be owned by low and moderate-income households to correct substandard and deteriorating conditions; (ii) providing assistance for the purchase and rehabilitation of vacant homes or construction of new homes; (iii) repairing and rehabilitating existing homeless shelters in the City and (iv) demolishing vacant and abandoned housing structures to prepare sites for residential purposes; and
WHEREAS, the City Auditor has certified to this Council that the estimated life of the improvement stated above which is to be financed from the proceeds of said bonds exceeds five (5) years and the maximum maturity of said bonds is ten (10) years.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. Bonds of the City of Columbus, Ohio (the "Municipality") shall be issued in the principal sum of Three Million Fifty Thousand Dollars ($3,050,000) (the "Bonds"), or such lesser amount as shall be determined by the Director of Finance and Management and certified to this Council, for the purpose set forth above and for paying the cost of advertising, printing and legal services and other costs incidental thereto. The Bonds shall be issued in one lot.
Section 2. There shall be and is hereby levied annually on all the taxable property in the Municipality, in addition to all other taxes and inside the ten mill limitation, a direct tax (the "Debt Service Levy") for each year during which any of the Bonds are outstanding, for the purpose of providing, and in an amount which is sufficient to provide, funds to pay interest upon the Bonds as and when the same falls due and to provide a fund for the repayment of the principal of the Bonds at maturity or upon redemption. The Debt Service Levy shall not be less than the interest and sinking fund tax required by Article XII, Section 11 of the Ohio Constitution.
Section 3. The Debt Service Levy shall be and is hereby ordered computed, certified, levied and extended upon the tax duplicate and collected by the same officers, in the same manner, and at the same time that taxes for general purposes for each of such years are certified, extended and collected. The Debt Service Levy shall be placed before and in preference to all other items and for the full amount thereof. The funds derived from the Debt Service Levy shall be placed in a separate and distinct fund, which shall be irrevocably pledged for the payment of the premium, if any, and interest on and principal of the Bonds when and as the same falls due. Notwithstanding the foregoing, if the Municipality determines that funds will be available from other sources for the payment of the Bonds in any year, the amount of the Debt Service Levy for such year shall be reduced by the amount of funds which will be so available, and the Municipality shall appropriate such funds to the payment of the Bonds in accordance with law.
Section 4. It is hereby determined that, for purposes of issuance and sale, it is in the best interests of the Municipality to combine the Bonds with other limited tax bond issues of the Municipality, authorized by other ordinances of this Council adopted on the date hereof. The Bonds and such other bonds will be jointly referred to herein as the "Combined Bonds". The Combined Bonds shall be designated "City of Columbus, Ohio Various Purpose Limited Tax Bonds, Series 2007B".
Section 5. The Combined Bonds shall be issued only as fully registered bonds, in the denomination of $5,000 or any integral multiple thereof but not exceeding the principal amount of Combined Bonds maturing on any one date; shall be numbered from R-1 upward; shall be dated as set forth in the Certificate of Award hereinafter identified; shall bear interest payable semi-annually on the first day of March and September of each year (the "Interest Payment Dates") beginning March 1, 2008, until the principal sum is paid; and shall bear interest at the rates and shall mature and be subject to mandatory and optional redemption in the years and at the redemption prices as shall be set forth in the Certificate of Award hereinafter identified.
If less than all of the then outstanding Combined Bonds are called for redemption, the Combined Bonds so called shall be selected by lot by the Municipality in such manner as it shall determine. When partial redemption of a single maturity of Combined Bonds is authorized, the Bond Registrar shall select Combined Bonds or portions thereof by lot within such maturity in such manner as the Bond Registrar may determine, provided, however, that the portion of any Combined Bond so selected will be in the amount of $5,000 or an integral multiple thereof.
The right of redemption shall be exercised by notice specifying by numbers the Combined Bonds to be called, the redemption price to be paid, the date fixed for redemption and the places where amounts due upon such redemption are payable. The Municipality shall cause such notice to be given by first class mail, postage prepaid, to the registered holder or holders of the Combined Bonds to be redeemed, mailed to the address shown on the registration books, not less than thirty (30) days prior to such redemption date. All Combined Bonds so called for redemption shall cease to bear interest on the redemption date, provided moneys for the redemption of said Combined Bonds are on deposit at the office of the Bond Registrar at that time.
Section 6. The Combined Bonds shall set forth the purposes for which they are issued and that they are issued pursuant to this Ordinance. The Combined Bonds shall be executed by the Mayor and the City Auditor of the Municipality, in their official capacities, provided that any of those signatures may be a facsimile. No Combined Bond shall be valid or become obligatory for any purpose or shall be entitled to any security or benefit under this Ordinance unless and until a certificate of authentication, as printed on the Combined Bond, is signed by the Bond Registrar (as defined in Section 7 hereof) as authenticating agent. Authentication by the Bond Registrar shall be conclusive evidence that the Combined Bond so authenticated has been duly issued and delivered under this Ordinance and is entitled to the security and benefit of this Ordinance.
The principal of and premium, if any, and interest on the Combined Bonds shall be payable in lawful money of the United States of America without deduction for the services of the Bond Registrar as paying agent. The principal of the Combined Bonds shall be payable upon presentation and surrender of the Combined Bonds at the office of the Bond Registrar. Each Combined Bond shall bear interest from the later of the date thereof, or the most recent Interest Payment Date to which interest has been paid or duly provided for, unless the date of authentication of any Bond is less than 15 days prior to an Interest Payment Date, in which case interest shall accrue from such Interest Payment Date. Interest on any Bond shall be paid on each Interest Payment Date by check or draft mailed to the person in whose name the Bond is registered, at the close of business on the 15th day next preceding that Interest Payment Date (the "Record Date") (unless such date falls on a non-business day, in which case the Record Date shall be the preceding business day), on the Bond Register (as defined in Section 7 hereof) at the address appearing therein.
Any interest on any Combined Bond which is payable, but is not punctually paid or provided for, on any Interest Payment Date (herein called "Defaulted Interest") shall forthwith cease to be payable to the registered owner on the relevant Record Date by virtue of having been such owner and such Defaulted Interest shall be paid to the registered owner in whose name the Combined Bond is registered at the close of business on a date (the "Special Record Date") to be fixed by the Bond Registrar, such Special Record Date to be not more than 15 nor less than 10 days prior to the date of proposed payment. The Bond Registrar shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first class postage prepaid, to each registered owner, at his address as it appears in the Bond Register, not less than 10 days prior to such Special Record Date, and may, in its discretion, cause a similar notice to be published once in a newspaper in each place where Combined Bonds are payable, but such publication shall not be a condition precedent to the establishment of such Special Record Date.
Subject to the foregoing provisions of this Section 6, each Combined Bond delivered by the Bond Registrar upon transfer of or in exchange for or in lieu of any other Combined Bond shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Combined Bond.
Section 7. The Trustees of the Sinking Fund of the City of Columbus are appointed to act as the authenticating agent, bond registrar, transfer agent and paying agent (collectively, the "Bond Registrar") for the Combined Bonds. So long as any of the Combined Bonds remain outstanding, the Municipality will cause to be maintained and kept by the Bond Registrar, at the office of the Bond Registrar, all books and records necessary for the registration, exchange and transfer of Combined Bonds as provided in this Section (the "Bond Register"). Subject to the provisions of Section 6 hereof, the person in whose name any Combined Bonds shall be registered on the Bond Register shall be regarded as the absolute owner thereof for all purposes. Payment of or on account of the principal of and premium, if any, and interest on any Combined Bond shall be made only to or upon the order of that person. Neither the Municipality nor the Bond Registrar shall be affected by any notice to the contrary, but the registration may be changed as herein provided. All payments shall be valid and effectual to satisfy and discharge the liability upon the Combined Bonds, including the interest thereon, to the extent of the amount or amounts so paid.
Any Combined Bond, upon presentation and surrender at the principal office of the Bond Registrar, together with a request for exchange signed by the registered owner or by a person authorized by the owner to do so by a power of attorney in a form satisfactory to the Bond Registrar, may be exchanged for Combined Bonds of any authorized denomination or denominations equal in the aggregate to the unmatured principal amount of the Combined Bonds surrendered, and bearing interest at the same rate and maturing on the same date.
A Combined Bond may be transferred only on the Bond Register upon presentation and surrender thereof at the principal office of the Bond Registrar, together with an assignment executed by the registered owner or by a person authorized by the owner to do so by a power of attorney in a form satisfactory to the Bond Registrar. Upon that transfer, the Bond Registrar shall complete, authenticate and deliver a new Combined Bond or Combined Bonds of any authorized denomination or denominations equal in the aggregate to the unmatured principal amount of the Combined Bonds surrendered, and bearing interest at the same rate and maturing on the same date.
The Municipality and the Bond Registrar shall not be required to transfer or exchange any Combined Bond for a period of fifteen days next preceding the date of its maturity.
In all cases in which Combined Bonds are exchanged or transferred hereunder, the Municipality shall cause to be executed and the Bond Registrar shall authenticate and deliver Combined Bonds in accordance with the provisions of this Ordinance. The exchange or transfer shall be without charge to the owner; except that the Municipality and Bond Registrar may make a charge sufficient to reimburse them for any tax or other governmental charge required to be paid with respect to the exchange or transfer. The Municipality or the Bond Registrar may require that those charges, if any, be paid before it begins the procedure for the exchange or transfer of the Combined Bonds. All Combined Bonds issued upon any transfer or exchange shall be the valid obligations of the Municipality, evidencing the same debt, and entitled to the same benefits under this Ordinance, as the Combined Bonds surrendered upon that transfer or exchange.
Section 8. The Combined Bonds shall be initially issued to a Depository for use in a book entry system (each as hereinafter defined), and the provisions of this Section shall apply notwithstanding any other provision of this Ordinance: (i) there shall be a single Combined Bond of each maturity, (ii) those Combined Bonds shall be registered in the name of the Depository or its nominee, as registered owner, and immobilized in the custody of the Depository; (iii) the beneficial owners in book entry form shall have no right to receive Combined Bonds in the form of physical securities or certificates; (iv) ownership of beneficial interests in any Combined Bond in book entry form shall be shown by book entry on the system maintained and operated by the Depository, and transfers of the ownership of beneficial interests shall be made only by the Depository and by book entry; and (v) the Combined Bonds as such shall not be transferable or exchangeable, except for transfer to another Depository or to another nominee of a Depository, without further action by the Municipality. Principal of and premium, if any, and interest on Combined Bonds in book entry form registered in the name of a Depository or its nominee shall be payable in next day funds delivered to the Depository or its authorized representative (i) in the case of interest, on each Interest Payment Date, and (ii) in all other cases, upon presentation and surrender of Combined Bonds as provided in this Ordinance.
The Bond Registrar may, with the approval of this Council, enter into an agreement with the beneficial owner or registered owner of a Combined Bond in the custody of a Depository providing for making all payments to that owner of principal of and premium, if any, and interest on that Combined Bond or any portion thereof (other than any payment of the entire unpaid principal amount thereof) at a place and in a manner (including wire transfer of federal funds) other than as provided above in this Ordinance, without prior presentation or surrender of the Combined Bond, upon any conditions which shall be satisfactory to the Bond Registrar and the Municipality. That payment in any event shall be made to the person who is the registered owner of the Combined Bond on the date that principal is due, or, with respect to the payment of interest, as of the applicable date agreed upon as the case may be. The Bond Registrar will furnish a copy of each of these agreements, certified to be correct by the Bond Registrar, to other paying agents for Combined Bonds and to the Municipality. Any payment of principal, premium or interest pursuant to such an agreement shall constitute payment thereof pursuant to, and for all purposes of, this Ordinance.
The City Auditor or the Director of Finance and Management of the Municipality, is authorized and directed to execute, acknowledge and deliver, in the name of and on behalf of the Municipality, the letter agreement among the Municipality, the Bond Registrar and The Depository Trust Company, as Depository, to be delivered, in connection with the issuance of the Combined Bonds to a Depository for use in a book entry system in substantially the form submitted to this Council.
If any Depository determines not to continue to act as a depository for the Combined Bonds for use in a book entry system, the Municipality and the Bond Registrar may attempt to have established a securities depository/book entry relationship with another qualified Depository under this Ordinance. If the Municipality and the Bond Registrar do not or are unable to do so, the Municipality and the Bond Registrar, after the Bond Registrar has made provision for notification of the beneficial owners by the then Depository, shall permit withdrawal of the Combined Bonds from the Depository, and authenticate and deliver Combined Bond certificates in fully registered form to the assigns of the Depository or its nominee, all at the cost and expense (including costs of printing definitive Combined Bonds), if the event is not the result of action or inaction by the Municipality or the Bond Registrar, of those persons requesting such issuance.
For purposes of this Ordinance the following terms shall have the following meanings:
"Book entry form" or "book entry system" means a form or system under which (i) the beneficial right to payment of principal of and interest and premium, if any, on the Combined Bonds may be transferred only through a book entry and (ii) physical Combined Bonds in fully registered form are issued only to a Depository or its nominee as registered owner, with the Combined Bonds "immobilized" to the custody of the Depository, and the book entry is the record that identifies the owners of beneficial interests in those Combined Bonds.
"Depository" means any securities depository that is a clearing agency under federal law operating and maintaining, together with its participants, a book entry system to record beneficial ownership of Combined Bonds, and to effect transfers of Combined Bonds, in book entry form, and includes The Depository Trust Company (a limited purpose trust company), New York, New York.
Section 9. The sale and award of the Combined Bonds shall be evidenced by the Certificate of Award signed by the Director of Finance and Management or the City Auditor. The Certificate of Award shall identify the original purchaser of the Combined Bonds (the "Original Purchaser"), who shall be selected in accordance with the provisions of the Form of Notice of Limited Tax Bond Sale attached hereto as Exhibit A, with such changes as the City Auditor shall approve, not inconsistent with this Ordinance. The Certificate of Award shall also state the aggregate principal amount of the Bonds as well as the aggregate principal amount of the Combined Bonds to be issued, the dated date of the Combined Bonds, the Purchase Price, the Specified Interest Rates, the Principal Retirement Dates, the Principal Retirement Schedule, Mandatory Redemption Dates, Mandatory Sinking Fund Requirements, Term Bonds, Term Maturity Dates, the Earliest Optional Redemption Date and the Optional Redemption Prices (all as hereinafter defined) and shall include such additional information as shall be required by the terms of this Ordinance and the Certificate of Award.
As used in this Section 9 and Section 5 hereof:
"Certificate of Award" means the certificate authorized by this Section 9 to be executed by the Director of Finance and Management or the City Auditor setting forth and determining such terms and other matters pertaining to the Combined Bonds, their issuance, sale or delivery, as are authorized and directed to be determined therein by this Ordinance.
"Earliest Optional Redemption Date" means the date specified in the Certificate of Award as the earliest date on which Combined Bonds may be called for redemption at the option of the Municipality.
"Mandatory Redemption Dates" means the first day of September in the years to be specified in the Certificate of Award in which the Combined Bonds that are Term Bonds are to be redeemed pursuant to Mandatory Sinking Fund Requirements.
"Mandatory Sinking Fund Requirements" means, as to Combined Bonds maturing on Term Maturity Dates, amounts sufficient to redeem such Combined Bonds (less the amount of credit as provided in the Certificate of Award) on each Mandatory Redemption Date, as are to be set forth in the Certificate of Award.
"Optional Redemption Prices", if any, for the Combined Bonds shall be as set forth in the Certificate of Award, but shall not exceed 100% of the principal amount to be so redeemed.
"Principal Retirement Dates" means the first day of September in the years in which the Combined Bonds are to be retired in accordance with their stated terms, which dates are to be specified in the Certificate of Award; provided that the Principal Retirement Dates shall be such that the final maturity of the principal portion of the Bonds included in the Combined Bonds is not later than the final maturity date permitted pursuant to Section 133.20, Ohio Revised Code.
"Principal Retirement Schedule" means the schedule for the retirement of the principal of the Combined Bonds on the Principal Retirement Dates, in accordance with their stated terms, in the years of Principal Retirement Dates and in the amounts to be retired which shall be determined in the Certificate of Award.
"Purchase Price" means that amount which is to be determined in the Certificate of Award, but such amount is to be no less than the aggregate principal amount of the Combined Bonds, together with accrued interest on the Combined Bonds from their date to the date of their delivery and payment therefor.
"Specified Interest Rates" means the interest rate or rates at which the Combined Bonds bear interest, which rates are to be determined in the Certificate of Award, provided the true interest cost of the Bonds shall not exceed five and one-half per centum (5.50%) per annum.
"Term Bonds" means those Combined Bonds, as are determined in the Certificate of Award, that are to mature on Term Maturity Dates, unless previously redeemed pursuant to Mandatory Sinking Fund Requirements.
"Term Maturity Dates" means the first day of September in the year or years in which Combined Bonds that are Term Bonds are to be retired in accordance with their stated terms, which date or dates are to be determined in the Certificate of Award.
The Director of Finance and Management, the City Auditor and the City Clerk are authorized and directed to make the necessary arrangements on behalf of the Municipality to establish the date, location, procedure and conditions for the delivery of the Combined Bonds to the Original Purchaser. Those officers are further directed to take all steps necessary to effect due execution, authentication and delivery of the Combined Bonds under the terms of this Ordinance.
The distribution of an Official Statement of the Municipality, in preliminary and final form, relating to the original issuance of the Combined Bonds is hereby authorized, and the Director of Finance and Management and the City Auditor, and each of them acting alone, is hereby authorized and directed to negotiate, prepare and execute, on behalf of the Municipality and in his official capacity, the Official Statement and any supplements thereto as so executed in connection with the original issuance of the Combined Bonds, and he is authorized and directed to advise the Original Purchaser in writing regarding limitations on the use of the Official Statement and any supplements thereto for purposes of marketing or reoffering the Combined Bonds as he deems necessary or appropriate to protect the interests of the Municipality. The Director of Finance and Management, the City Auditor, the City Attorney and any other official of the Municipality are each authorized to execute and deliver, on behalf of the Municipality and in their official capacities, such certificates in connection with the accuracy of the Official Statement, in either preliminary or final form, and any supplements thereto as may, in their judgment, be necessary or appropriate.
The proceeds from the sale of the Combined Bonds, except accrued interest, premium, if any, or costs of issuance, allocable to the Bonds (to wit: $3,050,000) shall be deposited in the City Treasury and allocated to the following funds and projects in the amounts set forth below:
Fund |
Project |
Amount |
Description |
735 |
441737 |
$ 100,000 |
Taylor Homes |
782 |
782001 |
2,550,000 |
Housing Preservation |
782 |
782002 |
400,000 |
Housing Preserv.-Home/Safe & Sound |
|
Total |
$3,050,000 |
|
While the Municipality anticipates spending the moneys allocated to the funds and projects in the manner set forth in the table above, the Municipality may determine, upon the approval of this Council, to reallocate proceeds of the Bonds to another fund and project consistent with the purpose for which the Bonds are issued.
Any premium received from the sale of the Combined Bonds shall be deposited in the City Treasury and shall be credited to such funds and used for such purposes as shall be specified in the Certificate of Award. All moneys necessary to carry out the purpose of this Ordinance are hereby deemed appropriated and authorized for expenditure by the City Auditor.
To provide for the payment of the costs of issuance of the Combined Bonds, which shall include, but shall not be limited to, the fees and expenses of the Municipality's bond counsel, the fees and expenses of the Municipality's financial advisor, rating agency fees, the fees and expenses associated with competitive sale of the Combined Bonds and printing fees, the Municipality is hereby authorized to expend a sum not to exceed Five Hundred Thousand Dollars ($500,000), and such amount is hereby deemed appropriated, which amount shall be allocated to, and paid from, the benefiting funds as determined by the City Auditor. Initial funds for the payment of such costs of issuance are hereby appropriated from Debt Service Fund #430, which fund shall then be reimbursed by the benefiting funds as determined by the City Auditor.
This Council hereby declares that the Combined Bonds are "obligations" within the meaning of Section 323.07(a)(7) of the Columbus City Codes. The Certificate of Award shall identify the annual financial information and operating data that will constitute the "annual information" for purposes of said Section 323.07.
Section 10. The Municipality hereby covenants that it will comply with the requirements of all existing and future laws which must be satisfied in order that interest on the Combined Bonds is and will continue to be excluded from gross income for federal income tax purposes, under applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"). The Municipality further covenants that it will restrict the use of the proceeds of the Combined Bonds in such manner and to such extent, if any, as may be necessary, after taking into account reasonable expectations at the time the debt is incurred, so that they will not constitute arbitrage bonds under Section 148 of the Code and the regulations prescribed thereunder (the "Regulations").
Break1
The City Auditor, the Deputy Auditor and the Director of Finance and Management, or any other officer, including the City Clerk, and each of them acting alone, is hereby authorized and directed (a) to make or effect any election, selection, designation, choice, consent, approval or waiver on behalf of the Municipality with respect to the Combined Bonds as permitted or required to be made or given under the federal income tax laws, for the purpose of assuring, enhancing or protecting favorable tax treatment or the status of the Combined Bonds or interest thereon or assisting compliance with requirements for that purpose, reducing the burden or expense of such compliance, reducing any rebate amount or any payment of penalties, or making any payments of special amounts in lieu of making computations to determine, or paying, any excess earnings as rebate, or obviating those amounts or payments, as determined by the City Auditor, the Deputy Auditor or the Director of Finance and Management, which action shall be in writing and signed by the City Auditor, the Deputy Auditor or the Director of Finance and Management, or any other officer, including the City Clerk, on behalf of the Municipality; (b) to take any and all actions, make or obtain calculations, and make or give reports, covenants and certifications of and on behalf of the Municipality, as may be appropriate to assure such exclusion of interest from gross income and the intended tax status of the Combined Bonds; and (c) to give an appropriate certificate on behalf of the Municipality, for inclusion in the transcript of proceedings, setting forth the facts, estimates and circumstances, and reasonable expectations of the Municipality pertaining to Section 148 and the Regulations, and the representations, warranties and covenants of the Municipality regarding compliance by the Municipality with sections 141 through 150 of the Code and the Regulations.
The City Auditor shall keep and maintain adequate records pertaining to investment of all proceeds of the Combined Bonds sufficient to permit, to the maximum extent possible and presently foreseeable, the Municipality to comply with any federal law or regulation now or hereafter having applicability to the Combined Bonds which limits the amount of Combined Bond proceeds which may be invested on an unrestricted yield or requires the Municipality to rebate arbitrage profits (or penalties in lieu thereof) to the United States Department of the Treasury. The City Auditor is hereby authorized and directed to file such reports with, and rebate arbitrage profits (or penalties in leu thereof) to,the United States Department of the Treasury,o the extent that any federalaw or regulation having applicability to the Combined Bonds requires any such reports or rebates. Moneys necessary to make such rebates are hereby appropriated for such purpose.
Section 11. I is hereby found and determined that all acts, conditions and things necessary to be done precedent to and in the issuing of the Combined Bonds in order to make them legal, valid and binding obligations of the Municipality have happened, been done and been performed in regular and due form as required by law; that the faith, credit and revenue of the Municipality are hereby irrevocably pledged for the prompt payment of the principal and interest thereof at maturity; and that no limitation of indebtedness or taxation, either statutory or constitutional, has been exceeded in issuing the Combined Bonds.
Section 12. It is hereby found and determined that all formal actions of this Council concerning and relating to the adoption of this Ordinance were adopted in an open meeting of this Council, and that all deliberations of this Council and of any of its committees that resulted in such formal action, were in meetings open to the public, in compliance with all legal requirements including Section 121.22 of the Ohio Revised Code.
Section 13. The City Clerk is hereby directed to forward certified copies of this Ordinance to the County Auditors of Franklin, Fairfield and Delaware Counties, Ohio.
Section 14. In accordance with Section 55(b) of the Charter of the City of Columbus, Ohio, this Ordinance shall take effect and be in force from and immediately after its passage and approval by the Mayor, or ten days after passage if the Mayor neither approves nor vetoes the same.
EXHIBIT A
FORM OF
NOTICE OF LIMITED TAX BOND SALE
CITY OF COLUMBUS, OHIO
$71,015,000
Various Purpose Limited Tax Bonds, Series 2007B
Notice is hereby given that electronic bids will be received via PARITY® until 11:00 am, Columbus, Ohio time, on November 14, 2007 for the purchase of an issue of City of Columbus, Ohio, Various Purpose Limited Tax Bonds, Series 2007B aggregating $71,015,000 (the "Bonds"). Bids may be submitted electronically via PARITY® pursuant to this Notice until 11:00 am, Columbus, Ohio time, on November 14, 2007, but no bid will be received after that time. To the extent any instructions or directions set forth in PARITY® conflict with this Notice, the terms of this Notice shall control. For further information about PARITY®, potential bidders may contact PARITY® at (212) 404-8102.
The Bonds will be dated the date of their delivery (which is expected to be November 28, 2007) and will be payable as to principal, either at stated maturity or by mandatory sinking fund redemption, on September 1 in the following years and principal amounts:
Year |
Principal Amount |
2009 |
$5,610,000 |
2010 |
5,610,000 |
2011 |
5,605,000 |
2012 |
5,600,000 |
2013 |
5,600,000 |
2014 |
5,595,000 |
2015 |
5,585,000 |
2016 |
4,730,000 |
2017 |
4,730,000 |
2018 |
4,730,000 |
2019 |
2,530,000 |
2020 |
2,530,000 |
2021 |
2,525,000 |
2022 |
2,525,000 |
2023 |
2,520,000 |
2024 |
2,520,000 |
2025 |
1,720,000 |
2026 |
285,000 |
2027 |
235,000 |
2028 |
230,000 |
The Bonds will bear interest from their dated date payable on March 1 and September 1 of each year, commencing March 1, 2008 Bonds maturing after September 1, 2017 are subject to redemption on or after September 1, 2017, in whole at any time or in part on any interest payment date, in such order as the City may determine, at a redemption price equal to 100% of the principal amount redeemed, plus accrued interest to the redemption date. The Bonds are not "qualified tax exempt obligations" within the meaning of Section 265(b) of the Internal Revenue Code of 1986, as amended. The Bonds are further described in the Preliminary Official Statement of the City dated November 7, 2007 (the "Preliminary Official Statement").
For purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, the Preliminary Official Statement may be treated as an Official Statement with respect to the Bonds that is deemed final by the City.
Continuing Disclosure
In order to assist bidders in complying with Rule 15c2-12(b)(5) of the United States Securities and Exchange Commission, the City has undertaken, pursuant to the ordinances authorizing the Bonds, to provide annual financial information and notice of certain events. The City's undertaking is described under the caption "CONTINUING DISCLOSURE" in the Preliminary Official Statement.
Types of Bids
Bidders must bid for the Bonds at not less than the aggregate par value ($71,015,000) with interest thereon accrued to the date of delivery, and premium, if any. Bids for less than all of the Bonds will not be considered. Each bid must specify an interest rate to be borne by the Bonds of each maturity, which interest rate must be an integral multiple of 1/8 of 1% or 1/20 of 1% and may not exceed 5.50%. Interest rates for different maturities need not be the same, but if a bid specifies different interest rates for different maturities, the highest interest rate specified must not exceed the lowest interest rate specified by more than 3%. Bidders may specify that the Bonds shall be issued as serial bonds, term bonds or any combination of serial and term bonds, provided that the combination of stated maturities and mandatory sinking fund redemptions are consistent with the principal payment schedule as set forth herein and in the Preliminary Official Statement. Bidders shall not be required to submit any bid security.
Method of Award
It is contemplated that the Director of Finance and Management or the City Auditor will award the Bonds, by certificate, at or before 2:00 p.m. on November 14, 2007. The Bonds will be awarded to the bidder offering the interest rate and premium resulting in the lowest true interest cost to the City. If two or more bids offer the lowest true interest cost, the Bonds will be awarded to one of said bidders, chosen by lot. The cost of delivery in the State of Ohio will not be considered in determining the best bid.
Adjustment of Principal Amounts
The City reserves the right to increase or decrease each principal maturity of the Bonds by up to ten percent (10%) prior to awarding the Bonds to the successful bidder, provided, however, that the aggregate principal amount of the Bonds as so adjusted shall equal $71,015,000. If such adjustments are made, the purchase price paid by the successful bidder shall be adjusted such that the rate of interest and premium paid by the successful bidder to the City for each maturity at which such adjusted amount shall be sold will be exactly the same as shown on the successful bid.
Book Entry
The Bonds will be issued in book entry form only (with no distribution of Bonds to the ultimate purchasers) registered in the name of The Depository Company, New York, New York (DTC), or its nominee and immobilized in DTC's custody.
Legal Opinion and Transcript
The approving legal opinion of Bricker & Eckler LLP, Bond Counsel for the Bonds, will be furnished by the City without expense to the successful bidder. The complete transcript of proceedings will also be furnished by the City, together with the usual closing papers and a certificate of the Director of Finance and Management, the City Auditor and the City Attorney relating to the Official Statement prepared and furnished by the City in connection with the sale of the Bonds. The City will also furnish up to one hundred copies of the Official Statement to the successful bidder, if so desired, FOB Columbus, Ohio, within seven (7) business days after award of the Bonds. All copies in excess of one hundred will be at the expense of the successful bidder. The Official Statement will constitute a final Official Statement for the Bonds as that term is defined in Rule 15c2-12 of the Securities and Exchange Commission.
Place of Delivery, Settlement and Expenses
The Bonds, in manuscript form, will be delivered to DTC, for the account of and against payment by the successful bidder, without charge. If the successful bidder requests that settlement occur at a place outside of Ohio, the successful bidder shall pay expense of settlement at that place, including travel expenses of City officials and Bond Counsel. The successful bidder shall bear the costs of the CUSIP registration and any fees imposed by DTC. The successful bidder shall be responsible for paying all fees imposed by the Ohio Municipal Advisory Council on the sale.
Delivery
Payment for the Bonds shall be made on the delivery date in immediately available funds in Columbus, Ohio. It is contemplated that the Bonds will be delivered through DTC on November 28, 2007. The City will give at least five days prior written notice to the successful bidder of the date selected by the City for tendering the Bonds at the place of delivery; provided, however, that nothing herein contained shall prevent the making of a mutually agreeable arrangement for the delivery of the Bonds either at the place fixed for delivery or elsewhere. If such notice has not been given or waived by the successful bidder and the Bonds, transcript, no litigation certificate and approving legal opinion are not available for delivery to the successful bidder at such place of delivery within thirty (30) days after the day fixed for the receipt of bids, and the successful bidder shall not be in default of any of its obligations, it shall have the right thereafter and so long as no such tender by the City shall yet have been made to cancel the contract of purchase, such right to be exercised by delivering to the undersigned, at the address set forth below, written notice of such cancellation.
Change in Tax Exempt Status
In the event that, prior to their delivery, the interest on the Bonds should by act of Congress or otherwise become included in gross income for purposes of federal income taxation, or Congress should enact any law which provides that the interest on the Bonds shall be so included at a future date, whether directly or indirectly, the successful bidder may refuse to accept delivery of the Bonds.
Miscellaneous
Neither the City nor Bond Counsel shall be responsible for, and each bidder expressly assumes the risk of, any incomplete, inaccurate or untimely bid submitted through PARITY® by such bidder, including, without limitation, by reason of garbled transmissions, mechanical failure, engaged telephone or telecommunication lines or any other cause arising from delivery through PARITY®.
Payments of interest on tax-exempt obligations, including the Bonds, are generally subject to IRS Form 1099-INT information reporting requirements. If a Bond owner is subject to backup withholding under those requirements, then payments of interest will also be subject to backup withholding. Those requirements do not affect the exclusion of such interest from gross income for federal income tax purposes.
The original purchaser of the Bonds, by submitting its proposal, agrees to provide promptly and timely information as to bona fide initial offering prices to the public and sales of the Bonds appropriate for the determination of the issue price of, and the yield on, the Bonds to the City and Bond Counsel, as requested by Bond Counsel.
The City reserves the right to reject any or all bids.
Dated: November 7, 2007 CITY OF COLUMBUS, OHIO
Joel S. Taylor
Director of Finance and Management
90 West Broad Street
Columbus, Ohio 43215