HomeMy WebLinkAboutord2010-040 WHATCOM COUNTY COUNCIL AGENDA BILL Na 2010- 344
CLEARANCES Initial Date Date Received in Council Office Agenda Date Assigned to:
Originator: PK 9/24/10 9/28/10 Finance
Division Head: 10 / 12 / 2010 Hearing
Dept. Head:
Prosecutor: g � t ) ` Q
".'sue
Purchasing/Budget: ?/290.0 —
Executive:
TITLE OF DOCUMENT:
Ordinance Authorizing the issuance of Limited Tax General Obligation and Refunding Bonds, 2010A
In the Amount of $ [4,355 ,000] and Limited Tax General Obligation Bonds, 2010B (Taxable Recovery Zone Economic
Development Bonds - Direct Payment) in the . Amount of $ [ 1 ,825 ,000]
ATTACHMENTS: Ordinance, Memo
SEPA review required? ( ) Yes ( ) NO Should Clerk schedule a hearing? (x ) Yes ( ) NO
SEPA review completed? ( ) Yes ( ) NO Requested Date: 10/12/10
SUMMARY STATEMENT OR LEGAL NOTICE LANGUAGE: (If this item is an ordinance or requires a public
hearing, you must provide the language for use in the required public notice. Be specific and cite RCW or WCC as appropriate. Be
clear in explaining the intent of the action.)
This ordinance authorizes the issuance of Limited Tax General Obligation and Refunding Bonds, 2010A
In the Amount of $ [4,355 ,000] and Limited Tax General Obligation Bonds, 2010B (Taxable Recovery Zone
Economic Development Bonds — Direct Payment) in the Amount of $ [ 1 ,825 ,000]
COMMITTEE ACTION: COUNCIL ACTION:
9 / 28 / 2010 : Introduced
10 / 12 / 2010 : Council Adopted 7 -0
Ord . 2010-040
Related County Contract #: Related File Numbers: Ordinance or Resolution Number:
Ord . 2010- 040
Please Note: Once adopted and signed, ordinances and resolutions are available for viewing and printing on
the County 's website at: www. co. whatcom. wa. us/council.
r
ORDINANCE NO . 2010-040
AUTHORIZING THE ISSUANCE OF LIMITED TAX GENERAL OBLIGATION AND
REFUNDING BONDS , 2010A
IN THE AMOUNT OF $4,310.,000
AND
LIMITED TAX GENERAL OBLIGATION BONDS , 2010B (TAXABLE RECOVERY ZONE
ECONOMIC DEVELOPMENT BONDS - DIRECT PAYMENT)
IN THE AMOUNT OF $ 1 ,825 ,000
WHATCOM COUNTY
ORDINANCE NO. 2010-040
Table Of Contents *
Section 1 . Definitions 4
Section 2 . Authorization of Bonds 8
Section 3 . Registration, Exchange and Payments 10
Section 4 . Redemption and Purchase of Bonds 15
Section 5 . Form of Bonds 22
Section 6 . Execution of Bonds 27
Section 7 . Application of Bond Proceeds and Redemption of the Refunded Bonds 28
Section 8 . Pledge of Taxes and Credit 29
Section 9 . Defeasance 29
Section 10 . Tax Covenants and Designation 30
Section 11 . Undertaking to Provide Ongoing Disclosure 32
Section 12 . Lost or Destroyed Bonds 36
Section 13 . Sale of Bonds 36
Section 14 . Severability 37
Section 15 . Effective Date 38
* This Table of Contents and the cover page are not a part of the following ordinance and are
included only for the convenience of the reader.
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1 INTRODUCED BY:
2 PROPOSED BY : Executive
3 DATE INTRODUCED : 09/28/2010
4
5 ORDINANCE NO . 2010-040
6
7 AN ORDINANCE OF THE COUNTY COUNCIL OF WHATCOM
8 COUNTY, WASHINGTON, PROVIDING FOR THE ISSUANCE
9 AND SALE OF TWO SERIES OF LIMITED TAX GENERAL
10 OBLIGATION AND REFUNDING BONDS OF THE COUNTY
11 IN THE AGGREGATE PRINCIPAL AMOUNT OF $6, 135 ,000
12 TO REFUND CERTAIN OUTSTANDING OBLIGATIONS OF
13 THE COUNTY AND TO PROVIDE FINANCING FOR
14 CAPITAL IMPROVEMENTS ; PROVIDING THE DATE, FORM,
15 TERMS , MATURITIES , AND REDEMPTION PROVISIONS OF
16 THE BONDS ; PROVIDING FOR THE DISPOSITION OF THE
17 BOND PROCEEDS ; PROVIDING FOR THE ANNUAL LEVY
18 OF TAXES TO PAY THE PRINCIPAL OF AND INTEREST ON
19 THE BONDS ; AND AUTHORIZING THE SALE OF THE
20 BONDS .
21
22 WHEREAS , Whatcom County, Washington (the "County") has issued its Limited Tax
23 General Obligation and Refunding Bonds, 1997 under date of March 1 , 1997 in the aggregate
24 principal amount of $9,990,000 pursuant to Ordinance No. 97-009, which remain outstanding as
25 follows :
Maturity Years Principal Interest
(June 1 ) Amount Rate
2011 $ 1 , 160,000 5 .20%
2012 185 ,000 5 . 15
26
27 (the " 1997 Bonds") ; and
28 WHEREAS , Ordinance No . 97-009 authorizes the defeasance and redemption of the
29 1997 Bonds maturing on and after June 1 , 2008 in advance of their scheduled maturity on June 1 ,
30 2007, in whole or in part at any time, at a price of par plus accrued interest to the date of
31 redemption; and
1 WHEREAS , the County has issued its Limited Tax General Obligation Bonds, 1998
2 under date of December 1 , 1998 in the aggregate principal amount of $3 ,360,000, pursuant to
3 Ordinance No . 98 -084, which remain outstanding as follows :
Maturity
(December 1 ) Principal Amounts Interest Rates
2010 $ 170,000 4 .20%
2011 180,000 4 .25
2012 185 ,000 4. 30
2013 200,000 4 . 35
2014 200,000 4 .40
2015 215 ,000 4 . 50
2018 700,000 4 . 70
4
5 (the " 1998 Bonds") ; and
6 WHEREAS , Ordinance No . 98-084 authorizes the defeasance and redemption of the
7 1998 Bonds maturing on and after December 1 , 2009 in advance of their scheduled maturity on
8 December 1 , 2008 , in whole or in part at any time, at a price of par plus accrued interest to the
9 date of redemption; and
10 WHEREAS , it appears to the County Council (the "Council") that the 1997 Bonds and
11 the 1998 Bonds (together, the "Refunded Bonds") may be refunded at savings to the County by
12 the issuance of the limited tax general obligation refunding bonds authorized herein (the
13 "Refunding Bonds") ; and
14 WHEREAS , the County has determined that it is in the best interest of the County to
15 make safety improvements at the County jail (the "Project") ; and
16 WHEREAS , the County is authorized by RCW Chs . 36 . 67 and 39 .46 to incur
17 indebtedness and issue bonds for county purposes; and
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1 WHEREAS the County desires to issue tax-exempt limited tax general obligation bonds
2 (the "Improvement Bonds," and together with the Refunding Bonds, the "2010A Bonds") to
3 finance a portion of the Project; and
4 WHEREAS , pursuant to the American Recovery and Reinvestment Act of 2009
5 ("ARRA") and Internal Revenue Service Notice No . 2009-50 ("Notice 2009-50"), the County
6 has received volume cap allocation of recovery zone economic development bonds ("Recovery
7 Zone Economic Development Bonds"), in the amount of $ 1 , 825 ,000 ; and
8 WHEREAS proceeds of Recovery Zone Economic Development Bonds must be used to
9 finance capital expenditures paid or incurred with respect to property located in a recovery zone,
10 expenditures for public infrastructure and construction of public facilities, and expenditures for
11 job training and educational programs, all of which are designed to promote economic
12 development or other economic activity in a recovery zone, and
13 WHEREAS, pursuant to a resolution of the Council adopted on March 30, 2010, the
14 County has designated the geographic boundaries of the County as a "recovery zone" pursuant to
15 Sections 1400U- 1 , 1400U-2, and 1400U-3 of the Internal Revenue Code of 1986, as amended
16 ("Code"), and
17 WHEREAS the County now desires to issue Recovery Zone Economic Development
18 Bonds (the "2010B Bonds," and together with the 2010A Bonds, the "Bonds") to finance certain
19 components of the Project, located in the County' s designated recovery zone that qualify for
20 financing under Sections 1400U- 1 , 1400U-2, and 1400U-3 of the Code, as applicable, and
21 WHEREAS , it appears to the Council that it is in the best interest of the County that the
22 written offer of Seattle-Northwest Securities Corporation, Seattle, Washington, to underwrite the
23 Bonds herein authorized be accepted;
•
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1 NOW, THEREFORE, THE WHATCOM COUNTY COUNCIL DOES ORDAIN, as
2 follows :
3 Section 1 . Definitions. As used in this ordinance, the following words shall have the
4 following meanings :
5 Acquired Obligations means the Government Obligations acquired by the County under
6 the terms of this ordinance to effect the refunding of the Refunded Bonds.
7 Bond Fund means the special fund of the County designated as the "2010 General
8 Obligation and Refunding Bond Redemption Fund" and maintained in the office of the
9 Treasurer.
10 Bond Register means the registration books for the Bonds, maintained by the Bond
11 Registrar, for the purpose of complying with the requirements of Section 149 of the Internal
12 Revenue Code of 1986, as amended, and listing, inter alia, the names and addresses of all
13 registered owners of Bonds .
14 Bond Registrar means the fiscal agency of the State of Washington for the purposes of
15 registering and authenticating the Bonds, maintaining the Bond Register, effecting transfer of
16 ownership of the Bonds and paying interest on and principal of the Bonds or such other entity as
17 may hereafter be appointed by the Treasurer to perform the duties of the Bond Registrar.
18 Bonds means, collectively, the 2010A Bonds and the 2010B Bonds .
19 Code means the federal Internal Revenue Code of 1986, as amended from time to time,
20 and the applicable regulations thereunder.
21 Commission means the Securities and Exchange Commission.
22 Council means the duly constituted County Council of Whatcom County as the general
23 legislative authority of the County.
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1 County means Whatcom County, Washington, a political subdivision, duly organized and
2 existing under and by virtue of its Charter and the laws of the State of Washington.
3 DTC means The Depository Trust Company, New York, New York, a limited purpose
4 trust company organized under the laws of the State of New York, as depository for the Bonds
5 pursuant to Section 3 hereof
6 Government Obligations means those obligations now or hereafter defined as such in
7 chapter 39 . 53 RCW.
8 Improvement Bonds means the tax-exempt limited tax general obligation bonds
9 authorized to be issued pursuant to this ordinance to finance a portion of the costs of the Project.
10 Letter of Representation means a blanket issuer letter of representations from the County
11 to DTC .
12 MSRB means the Municipal Securities Rulemaking Board or any successor to its
13 functions .
14 Net Proceeds, when used with reference to the Bonds, means the principal amount of the
15 Bonds, plus accrued interest and original issue premium, if any, and less original issue discount.
16 1997 Bonds means the County' s Limited Tax General Obligation and Refunding Bonds,
17 1997 issued under date of March 1 , 1997 in the aggregate principal amount of $9,990,000,
18 pursuant to Ordinance No . 97-009, which remain outstanding in the aggregate principal amount
19 of $ 1 ,345 ,000 . .
20 1998 Bonds means the County' s Limited Tax General Obligation Bonds, 1998 issued
21 under date of December 1 ., 1998 in the aggregate principal amount of $3 ,360,000, pursuant to
22 Ordinance No . 98 -084, which remain outstanding in the aggregate principal amount of
23 $ 1 ,850,000 .
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1 Private Person means any natural person engaged in a trade or business or any trust,
2 estate, partnership, association, company or corporation.
3 Private Person Use means the use of property in a trade or business by a Private Person if
4 such use is other than as a member of the general public. Private Person Use includes ownership
5 of the property by the Private Person as well as other arrangements that transfer to the Private
6 Person the actual or beneficial use of the property (such as a lease, management or incentive
7 payment contract or other special arrangement) in such a manner as to set the Private Person
8 apart from the general public. Use of property as a member of the general public includes
9 attendance by the Private Person at municipal meetings or business rental of property to the
10 Private Person on a day-to-day basis if the rental paid by such Private Person is the same as the
11 rental paid by any Private Person who desires to rent the property. Use of property by nonprofit
12 community groups or community recreational groups is not treated as Private Person Use if such
13 use is incidental to the governmental uses of property, the property is made available for such use
14 by all such community groups on an equal basis and such community groups are charged only a
15 de minimis fee to cover custodial expenses .
16 Project means the replacement of the security electronics in the County jail and juvenile
17 detention facility, replacement of the fire safety systems in the County jail and creation of
18 additional emergency exits in the housing areas of the facility.
19 Project Fund means the 2010 Jail Improvement Fund established by the Treasurer
20 pursuant to Section 7 hereof.
21 Recovery Zone Economic Development Bonds mean bonds issued as "Recovery Zone
22 Economic Development Bonds" as defined in Section 1400U-2 of the Code to finance a portion
23 of the costs of the Project.
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1 Refunded Bonds means, collectively, the 1997 Bonds and the 1998 Bonds .
2 Refunding Bonds means the limited tax general obligation refunding bonds authorized
3 by this ordinance to be issued to refund the Refunded Bonds.
4 Registered Owner means the person in whose name a Bond is registered on the Bond
5 Register. For so long as the Bonds are held in book-entry only form, DTC shall be deemed to be
6 the sole Registered Owner. .
7 Rule means the Commission' s Rule 15c2- 12 under the Securities Exchange Act of 1934,
8 as the same may be amended from time to time .
9 Treasurer means the Treasurer of the County.
10 2010A Bonds means the $4,310,000 of Whatcom County, Washington Limited Tax
11 General Obligation and Refunding Bonds, 2010A, consisting of the Improvement Bonds and the
12 Refunding Bonds, issued pursuant to this ordinance.
13 2010B Bonds means the $ 1 , 825 ,000 of Whatcom County, Washington Limited Tax
14 General Obligation Bonds, 2010B (Taxable Recovery Zone Economic Development Bonds —
15 Direct Payment), issued pursuant to this ordinance as Recovery Zone Economic Development
16 Bonds .
17 Underwriter means Seattle-Northwest Securities Corporation, Seattle, Washington.
18 Interpretation : In this ordinance, unless the context otherwise requires :
19 (a) The terms "hereby," "hereof," "hereto," "herein, "hereunder" and any similar
20 terms, as used in this ordinance, refer to this ordinance as a whole and not to any particular
21 article, section, subdivision or clause hereof, and the term "hereafter" shall mean after, and the
22 . term "heretofore" shall mean before, the date of this ordinance;
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1 (b) Words of the masculine gender shall mean and include correlative words of the
2 feminine and neuter genders and words importing the singular number shall mean and include
3 the plural number and vice versa;
4 (c) Words importing persons shall include firms, associations, partnerships (including
5 limited partnerships), trusts, corporations and other legal entities, including public bodies, as well
6 as natural persons ;
7 (d) Any headings preceding the text of the several articles and Sections of this
8 ordinance, and any table of contents or marginal notes appended to copies hereof, shall be solely
9 for convenience of reference and shall not constitute a part of this ordinance, nor shall they affect
10 its meaning, construction or effect; and
11 (e) All references herein to "articles," "sections" and other subdivisions or clauses are
12 to the corresponding articles, sections, subdivisions or clauses hereof .
13 Section 2 . Authorization of Bonds .
14 . (a) 2010A Bonds. The County shall issue and sell the 2010A Bonds in the principal
15 amount of $4,310,000 for the purpose of current refunding the Refunded Bonds, paying a portion
16 of the costs of the Project and paying costs of issuance of the 2010A Bonds. The 2010A Bonds
17 shall be designated as "Whatcom County, Washington, Limited Tax General Obligation and
18 Refunding Bonds, 2010A" (the "2010A Bonds"), shall be dated as of their date of initial delivery,
19 shall be fully registered as to both principal and interest, shall be in the denomination of $ 5 ,000
20 each or any integral multiple thereof, provided further that no 2010A Bond shall represent more
21 than one maturity, shall be numbered separately in such manner and with any additional
22 designation as the Bond Registrar deems necessary for purposes of identification and control, and
23 shall bear interest payable on December 1 , 2010, and semiannually thereafter on the first days of
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1 June and December. The 2010A Bonds shall bear interest at the following rates and mature in
2 the following years in the following principal amounts :
Maturity Principal Amounts ' Interest Rates
December 1 , 2010 $ 235 ,000-R 2. 000%
June 1 , 2011 1 ,355 ,000-R 2 . 000
June 1 , 2011 105 ,000 2 . 000
June 1 , 2012 360,000-R 2 .000
June 1 , 2012 115 ,000 2 .000
December 1 , 2013 190,000-R 3 .000
December 1 , 2013 115 ,000 3 .000
December 1 , 2014 190,000-R 3 . 500
December 1 , 2014 120,000 3 . 500
December 1 , 2015 200,000-R 4 . 000
December 1 , 2015 125 ,000 4 . 000
December 1 , 2016 205 ,000-R 4 . 000
December 1 , 2016 125 ,000 4 . 000
December 1 , 2017 125 ,000-R 1 . 750
December 1 , 2017 80,000 1 . 750
December 1 , 2017 95 ,000-R 4 . 000
December 1 , 2017 55 ,000 4. 000
December 1 , 2018 65 ,000-R 2 .000
December 1 , 2018 40,000 2 . 000
December 1 , 2018 155 ,000-R 4 . 000
December 1 , 2018 95 ,000 4 . 000
December 1 , 2019 140,000 3 . 000
December 1 , 2020 20,000 3 . 000
3
1 Principal amounts designated with an "-R" represent Refunding Bonds. The remaining principal amounts
represent Improvement Bonds.
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1 (b) 2010B Bonds. The County shall issue and sell the 2010B Bonds in the principal
2 amount of $ 1 ,825 ,000 for the purpose of paying a portion of the costs of the Project and costs of
3 issuance of the 2010B Bonds. The 2010B Bonds shall be designated as "Whatcom County,
4 Washington, Limited Tax General Obligation Bonds, 2010B (Taxable Recovery Zone Economic
5 Development Bonds — Direct Payment)" (the "2010B Bonds"), shall be dated as of their date of
6 initial delivery, shall be fully registered as to both principal and interest, shall be in the
7 denomination of $5 ,000 each or any integral multiple thereof, provided further that no 2010B
8 Bond shall represent more than one maturity, shall be numbered separately in such manner and
9 with any additional designation as the Bond Registrar deems necessary for purposes of
10 identification and control, and shall bear interest payable on June 1 , 2011 , and semiannually
11 thereafter on the first days of June and December. The 2010B Bonds shall bear interest at the
12 following rates and mature on December 1 of the following years in the following principal
13 amounts :
Maturity
(December 1 ) Principal Amounts Interest Rates
2024 $ 755 ,000 5 . 000%
2030 1 ,070,000 5 .250
14
15 Section 3 . Registration, Exchange and Payments .
16 (a) Bond Registrar/Bond Register. The County hereby requests that the Treasurer
17 specify and adopt the system of registration approved by the Washington State Finance
18 Committee from time to time through the appointment of state fiscal agencies . The County shall
19 cause a bond register to be maintained by the Bond Registrar. So long as any Bonds remain
20 outstanding, the Bond Registrar shall make all necessary provisions to permit the exchange or
21 registration or transfer of Bonds at its principal corporate trust office. The Bond Registrar may
22 be removed at any time at the option of the Treasurer upon prior notice to the Bond Registrar and
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1 a successor Bond Registrar appointed by the Treasurer. No resignation or removal of the Bond
2 Registrar shall be effective until a successor shall have been appointed and until the successor
3 Bond Registrar shall have accepted the duties of the Bond Registrar hereunder. The Bond
4 Registrar is authorized, on behalf of the County, to authenticate and deliver Bonds transferred or
5 exchanged in accordance with the provisions of such Bonds and this ordinance and to carry out
6 all of the Bond Registrar' s powers and duties under this ordinance. The Bond Registrar shall be
7 responsible for its representations contained in the Certificate of Authentication of the Bonds.
8 (b) Registered Ownership. The County and the Bond Registrar, each in its discretion,
9 may deem and treat the Registered Owner of each Bond as the absolute owner thereof for all
10 purposes (except as provided in Section 11 of this ordinance), and neither the County nor the
11 Bond Registrar shall be affected by any notice to the contrary. Payment of any such Bond shall
12 be made only as described in Section 3 (h) hereof, but such Bond may be transferred as herein
13 provided. All such payments made as described in Section 3 (h) shall be valid and shall satisfy
14 and discharge the liability of the County upon such Bond to the extent of the amount or amounts
15 so paid.
16 (c) DTC Acceptance/Letter of Representations. The Bonds initially shall be held in
17 fully immobilized form by DTC acting as depository. To induce DTC to accept the Bonds as
18 eligible for deposit at DTC, the County has executed and delivered to DTC a Blanket Issuer
19 Letter of Representations. Neither the County nor the Bond Registrar will have any
20 responsibility or obligation to DTC participants or the persons for whom they act as nominees (or
21 any successor depository) with respect to the Bonds in respect of the accuracy of any records
22 . maintained by DTC (or any successor depository) or any DTC participant, the payment by DTC
23 (or any successor depository) or any DTC participant of any amount in respect of the principal of
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1 or interest on Bonds, any notice which is permitted or required to be given to Registered Owners
2 under this ordinance (except such notices as shall be required to be given by the County to the
3 Bond Registrar or to DTC (or any successor depository)), or any consent given or other action
4 taken by DTC (or any successor depository) as the Registered Owner. For so long as any Bonds
5 are held in fully-immobilized form hereunder, DTC or its successor depository shall be deemed
6 to be the Registered Owner for all purposes hereunder, and all references herein to the Registered
7 Owners shall mean DTC (or any successor depository) or its nominee and shall not mean the
8 owners of any beneficial interest in such Bonds .
9 If any Bond shall be duly presented for payment and funds have not been duly provided
10 by the County on such applicable date, then interest shall continue to accrue thereafter on the
11 unpaid principal thereof at the rate stated on such Bond until it is paid.
12 (d) Use of Depository.
13 ( 1 ) The Bonds shall be registered initially in the name of "Cede & Co .", as
14 nominee of DTC, with one Bond for each series maturing on each of the maturity dates for the
15 Bonds in a denomination corresponding to the total principal therein designated to mature on
16 such date. Registered ownership of such immobilized Bonds, or any portions thereof, may not
17 thereafter be transferred except (A) to any successor of DTC or its nominee, provided that any
18 such successor shall be qualified under any applicable laws to provide the service proposed to be
19 provided by it; (B) to any substitute depository appointed by the Treasurer pursuant to
20 subsection (2) below or such substitute depository' s successor; or (C) to any person as provided
21 in subsection (4) below.
22 (2) Upon the resignation of DTC or its successor (or any substitute depository
23 or its successor) from its functions as depository or a determination by the Treasurer to
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1 discontinue the system of book entry transfers through DTC or its successor (or any substitute
2 . depository or its successor), the Treasurer may hereafter appoint a substitute depository. Any
3 such substitute depository shall be qualified under any applicable laws to provide the services
4 proposed to be provided by it.
5 (3 ) In the case of any transfer pursuant to clause (A) or (B) of subsection ( 1 )
6 above, the Bond Registrar shall, upon receipt of all outstanding Bonds, together with a written
7 request on behalf of the Treasurer, issue a single new Bond for each series and maturity then
8 outstanding, registered in the name of such successor or such substitute depository, or their
9 nominees, as the case may be, all as specified in such written request of the Treasurer.
10 (4) In the event that (A) DTC or its successor (or substitute depository or its
11 successor) resigns from its functions as depository, and no substitute depository can be obtained,
12 or (B) the Treasurer determines that it is in the best interest of the beneficial owners of the Bonds
13 that such owners be able to obtain such bonds in the form of Bond certificates, the ownership of
14 such Bonds may then be transferred to any person or entity as herein provided, and shall no
15 longer be held in fully-immobilized form. The Treasurer shall deliver a written request to the
16 Bond Registrar, together with a supply of definitive Bonds, to issue Bonds as herein provided in
17 any authorized denomination. Upon receipt by the Bond Registrar of all then outstanding Bonds
18 together with a written request on behalf of the Treasurer to the Bond Registrar, new Bonds shall
19 be issued in the appropriate denominations and registered in the names of such persons as are
20 requested in such written request. .
21 (e) Registration of Transfer of Ownership or Exchange; Change in Denominations.
22 The transfer of any Bond may be registered and Bonds may be exchanged, but no transfer of any
23 such Bond shall be valid unless it is surrendered to the Bond Registrar with the assignment form
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1 appearing on such Bond duly executed by the Registered Owner or such Registered Owner' s duly
2 authorized agent in a manner satisfactory to the Bond Registrar. Upon such surrender, the Bond
3 Registrar shall cancel the surrendered Bond and shall authenticate and deliver, without charge to
4 the Registered Owner or transferee therefor, a new Bond (or Bonds at the option of the new
5 Registered Owner) of the same date, maturity and interest rate and for the same aggregate
6 principal amount in any authorized denomination, naming as Registered Owner the person or
7 persons listed as the assignee on the assignment form appearing on the surrendered Bond, in
8 exchange for such surrendered and cancelled Bond. Any Bond may be surrendered to the Bond
9 Registrar and exchanged, without charge, for an equal aggregate principal amount of Bonds of
10 the same date, maturity and interest rate, in any authorized denomination. The Bond Registrar
11 shall not be obligated to register the transfer or to exchange any Bond during the 15 days
12 preceding any interest payment or principal payment date any such Bond is to be redeemed.
13 Co Bond Registrar 's Ownership of Bonds . The Bond Registrar may become the
14 Registered Owner of any Bond with the same -rights it would have if it were not the Bond
15 Registrar, and to the extent permitted by law, may act as depository for and permit any of its
16 officers or directors to act as member of, or in any other capacity with respect to, any committee
17 formed to protect the right of the Registered Owners of Bonds.
18 (g) Registration Covenant. The County covenants that, until all Bonds have been
19 surrendered and canceled, it will maintain a system for recording the ownership of each Bond
20 that complies with the provisions of Section 149 of the Code.
21 (h) Place and Medium of Payment. Both principal of and interest on the Bonds shall
22 be payable in lawful money of the United States of America. Interest on the Bonds shall be
23 calculated on the basis of a year of 360 days and twelve 30-day months . For so long as all Bonds
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•
1 are in fully immobilized form, payments of principal and interest thereon shall be made as
2 provided in accordance with the operational arrangements of DTC referred to in the Letter of
3 Representations .
4 In the event that the Bonds are no longer in fully immobilized form, interest on the Bonds
5 shall be paid by check or draft mailed to the Registered Owners at the addresses for such
6 Registered Owners appearing on the Bond Register on the fifteenth day of the month preceding
7 the interest payment date, or upon the written request of a Registered Owner of more than
8 $ 1 ,000,000 of Bonds (received by the Bond Registrar at least 15 days prior to the applicable
9 payment date), such payment shall be made by the Bond Registrar by wire transfer to the account
10 within the continental United States designated by the Registered Owner. Principal of the Bonds
11 shall be payable upon presentation and surrender of such Bonds by the Registered Owners at the
12 principal office of the Bond Registrar.
13 Section 4 . Redemption and Purchase of Bonds.
14 (a) Optional Redemption . The 2010A Bonds are not subject to redemption prior to
15 their scheduled maturity. Except as provided in (b) and (c) below, the 2010B Bonds are not
16 subject to redemption prior to their stated maturities prior to December 1 , 2020 . The 2010B
17 Bonds maturing on or after December 1 , 2024 are subject to redemption at the option of the
18 County on and after December 1 , 2020, in whole or in part on any date, at a price of par plus
19 accrued interest, if any, to the date of redemption.
20 (b) Extraordinary Optional Redemption of the 2010B Bonds. The 2010B Bonds will
21 be subject to redemption prior to their respective stated maturity dates, at the option of the
22 County upon the occurrence of a Tax Law Change (as defined below), from any source of
23 available funds, as a whole or in part, and if in part by lot within a maturity, in authorized
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1 denominations on any date, (i) prior to December 1 , 2020 (if not called pursuant to an optional
2 redemption as provided above), at a redemption price equal to the sum of the present value of the
3 remaining scheduled payments of principal and interest to the maturity date of the 2010B Bonds
4 to be redeemed, not including any portion of those payments of interest accrued and unpaid as of
5 the date on which the 2010B Bonds are to be redeemed, discounted to the date on which the
6 2010B Bonds are to be redeemed, on a semi-annual basis, assuming a 360-day year consisting of
7 twelve 30-day months, at the Comparable Treasury Yield (defined below) plus 100 basis points;
8 and (ii) on or after December 1 , 2020, at a redemption price equal to par plus accrued interest to
9 the date of redemption, as provided above under.
10 Tax Law Change means legislation has been enacted by the Congress of the United
11 States or passed by either House of the Congress, or a decision has been rendered by a court of
12 the United States, or an order, ruling, regulation (final, temporary or proposed) or official
13 statement has been made by or on behalf of the U. S . Department of the Treasury ("Treasury"),
14 the Internal Revenue Service or other governmental agency of appropriate jurisdiction, the effect
15 of which, as reasonably determined by the County, would be to suspend, reduce or terminate the
16 timely payment from the Treasury to the County with respect to the 2010B Bonds, or to state or
17 local government issuers generally with respect to obligations of the general character of the
18 2010B Bonds, pursuant to Sections 54AA or 6431 of the Code, of an amount equal to at least 45
19 percent of the interest due thereon on each interest payment date ("Subsidy Payments") ;
20 provided, that such suspension, reduction or termination of the Subsidy Payments is not due to a
21 failure by the County to comply with the requirements under the Code to receive such Subsidy
22 Payments .
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1 Comparable Treasury Yield means the yield which represents the weekly average yield
2 to maturity for the preceding week appearing in the most recently published statistical release
3 designated "H . 15 (519) Selected Interest Rates" under the heading "Treasury Constant
4 Maturities," or any successor publication selected by the Independent Banking Institution that is
5 published weekly by the Board of Governors of the Federal Reserve System and that establishes
6 yields on actively traded United States Treasury securities adjusted to constant maturity, for the
7 maturity corresponding to the remaining term to maturity of the 2010B Bond being redeemed.
8 The Comparable Treasury Yield will be determined as of the third business day immediately
9 preceding the applicable date fixed for redemption. If the H. 15 (519) statistical release sets forth
10 a weekly average yield for United States Treasury securities that have a constant maturity that is
11 the same as the remaining term to maturity of the 2010B Bond being redeemed, then the
12 Comparable Treasury Yield will be equal to such weekly average yield. In all other cases, the
13 Comparable Treasury Yield will be calculated by interpolation on a straight-line basis, between
14 the weekly average yields on the United States Treasury securities that have a constant maturity
15 (a) closest to and greater than the remaining term to maturity of the 2010B Bond being redeemed;
16 and (b) closest to and less than the remaining term to maturity of the 2010B Bond being
17 redeemed. Any weekly average yields calculated by interpolation will be rounded to the nearest
18 1 / 100th of 1 %, with any figure of 1 /200th of 1 % or above being rounded upward.
19 (c) Mandatory Sinking Fund Redemption. Unless redeemed pursuant to the foregoing
20 optional and extraordinary optional redemption provisions, the 2010B Bonds maturing on
21 December 1 , 2024 are subject to mandatory sinking fund redemption at a price of par plus
22 accrued interest to the date of redemption on December 1 of the following years in the following
23 principal amounts :
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Redemption
Redemption Years Amounts
2020 $ 125 ,000
2021 150,000
2022 155 ,000
2023 160,000
2024 * 165 ,000
1 * Maturity
2 .
3 Unless redeemed pursuant to the foregoing optional and extraordinary optional
4 redemption provisions, the 2010B Bonds maturing on December 1 , 2030 are subject to
5 mandatory sinking fund redemption at a price of par plus accrued interest to the date of
6 redemption on December 1 of the following years in the following principal amounts :
Redemption
Redemption Years Amounts
2025 $ 165 ,000 .
2026 170,000
2027 175 ,000
2028 180,000
2029 185 ,000
2030 * 195 ,000
7 * Maturity.
8 To the extent the County shall have optionally redeemed or purchased any 2010B Bonds
9 since the last scheduled mandatory redemption of such 2010B Bonds, the County may reduce the
10 principal amount of the 2010B Bonds of the same maturity to be redeemed in like aggregate
11 principal amount. Such reduction may be applied in the year specified by the County.
12 (d) Selection of 2010B Bonds for Redemption. As long as the 2010B Bonds are held
13 in book-entry only form, the selection of 2010B Bonds within a maturity to be redeemed shall be
14 made in accordance with the operational arrangements in effect at DTC . If the 2010B Bonds are
15 no longer held in uncertificated form, the selection of such 2010B Bonds to be redeemed shall be
16 made as provided in this subsection (d) . If the County redeems at any one time fewer than all of
- 10- P:120287_CMW120287 900 10/12/10
1 the 2010B Bonds having the same maturity date, the particular 2010B Bonds or portions of
2 2010B Bonds of such maturity to be redeemed shall be selected by lot (or in such other manner
3 determined by the Treasurer) in increments of $ 5 ,000 . In the case of a 2010B Bond of a
4 denomination greater than $ 5 ,000, the County and Bond Registrar shall treat each 2010B Bond as
5 representing such number of separate 2010B Bonds each of the denomination of $ 5 ,000 as is
6 obtained by dividing the actual principal amount of such 2010B Bond by $ 5 ,000 . In the event
7 that only a portion of the principal sum of a 2010B Bond is redeemed, upon surrender of such
8 2010B Bond at the principal office of the Bond Registrar there shall be issued to the Registered
9 Owner, without charge therefor, for the then unredeemed balance of the principal sum thereof, at
10 the option of the Registered Owner, a 2010B Bond or 2010B Bonds of like maturity and interest
11 rate in any of the denominations herein authorized. If 2010B Bonds are called for redemption,
12 portions of the principal amount of such 2010B Bonds, in installments of $5 ,000 or any integral
13 multiple of $5 ,000, may be redeemed. If less than all of the principal amount of any 2010B Bond
14 is redeemed, upon surrender of such 2010B Bond at the principal office of the Bond Registrar
15 there shall be issued to the registered owner, without charge therefor, for the then unredeemed
16 balance of the principal amount thereof, a new 2010B Bond or 2010B Bonds, at the option of the
17 Registered Owner, of like maturity and interest rate in any denomination authorized by this
18 ordinance.
19 (e) Purchase of Bonds. The County reserves the right to purchase any of the Bonds
20 offered to it at any time at a price deemed reasonable by the County Treasurer.
21 (f) Notice of Redemption
22 ( 1 ) Official Notice. Unless waived by any owner of 2010B Bonds to be
23 redeemed, official notice of any such redemption, which notice may be conditional, shall be
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1 given by the Bond Registrar on behalf of the County by mailing a copy of an official redemption
2 notice by first class mail at least 20 days and not more than 60 days prior to the date fixed for
3 redemption to the Registered Owner of the 2010B Bond or 2010B Bonds to be redeemed at the
4 address shown on the Bond Register or at such other address as is furnished in writing by such
5 registered owner to the Bond Registrar.
6 All official notices of redemption shall be dated and shall state :
7 (A) the redemption date,
8 (B) the redemption price,
9 (C) if fewer than all outstanding 2010B Bonds are to be redeemed, the
10 identification by maturity (and, in the case of partial redemption, the respective principal
11 amounts) of the 2010B Bonds to be redeemed,
12 (D) that (unless the notice of redemption is a conditional notice, in
13 which case the notice shall state that interest shall cease to accrue from the redemption date if
14 and to the extent that funds have been provided to the Bond Registrar for the redemption of
15 2010B Bonds) on the redemption date the redemption price will become due and payable upon
16 each such 2010B Bond or portion thereof called for redemption, and that interest thereon shall
17 cease to accrue from and after said date, and
18 (E) the place where such 2010B Bonds are to be surrendered for
19 payment of the redemption price, which place of payment shall be the principal office of the
20 Bond Registrar.
21 On or prior to any redemption date, the County shall deposit with the Bond Registrar an
22 amount of money sufficient to pay the redemption price of all the 2010B Bonds or of portions of
23 2010B Bonds which are to be redeemed on that date.
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1 (2) Effect of Notice; Bonds Due. Unless the County has revoked a notice of
2 redemption (or unless the County provided a conditional notice and the conditions for
3 redemption set forth therein are not satisfied), official notice of redemption having been given as
4 aforesaid, the 2010B Bonds or portions of 2010B Bonds so to be redeemed shall, on the
5 redemption date, become due and payable at the redemption price therein specified, and from and
6 after such date (unless the County shall default in the payment of the redemption price) such
7 2010B Bonds or portions of 2010B Bonds shall cease to bear interest. Upon surrender of such
8 2010B Bonds for redemption in accordance with said notice, such 2010B Bonds shall be paid by
9 the Bond Registrar at the redemption price . Installments of interest due on or prior to the
10 redemption date shall be payable as herein provided for payment of interest. Upon surrender for
11 any partial redemption of any 2010B Bond, there shall be prepared for the Registered Owner a
12 new 2010B Bond or 2010B Bonds of the same maturity in the amount of the unpaid principal .
13 All 2010B Bonds which have been redeemed shall be canceled and destroyed by the Bond
14 Registrar and shall not be reissued.
15 (3 ) Additional Notice. In addition to the foregoing notice, further notice may
16 be given by the County as set out below, but no defect in said further notice nor any failure to
17 give all or any portion of such further notice shall in any manner defeat the effectiveness of a call
18 for redemption if notice thereof is given as above prescribed. Each further notice of redemption
19 given hereunder shall contain the information required above for an official notice of redemption
20 plus (A) the CUSIP numbers of all 2010B Bonds being redeemed; (B) the date of issue of the
21 2010B Bonds as originally issued; (C) the rate of interest, if any, borne by each 2010B Bond
22 being redeemed; (D) the maturity date of each Bond being redeemed; and (E) any other
23 descriptive information needed to identify accurately the 2010B Bonds being redeemed. Each
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1 further notice of redemption may be sent at least 25 days before the redemption date to each party
2 entitled to receive notice pursuant to Section 11 .
3 (4) CUSIP Number. Upon the payment of the redemption price of 2010B
4 Bonds being redeemed, each check or other transfer of funds issued for such purpose shall bear
5 the CUSIP number identifying, by maturity, the 2010B Bonds being redeemed with the proceeds
6 of such check or other transfer.
7 (5) Amendment of Notice Provisions. The foregoing notice provisions of this
8 Section 4, including but not limited to the information to be included in redemption notices and
9 the persons designated to receive notices, may be amended by additions, deletions and changes in
10 order to maintain compliance with duly promulgated regulations and recommendations regarding
11 notices of redemption of municipal securities .
12 Section 5 . Form of Bonds.
13 (a) 2010A Bonds. The 2010A Bonds shall be in substantially the following form:
14
15 UNITED STATES OF AMERICA
16 NO . $
17 STATE OF WASHINGTON
18 WHATCOM COUNTY
19 LIMITED TAX GENERAL OBLIGATION AND REFUNDING BOND, 2010A
20
21 INTEREST RATE : MATURITY DATE: CUSIP NO. :
22
23 REGISTERED OWNER: CEDE & Co .
24
25 PRINCIPAL AMOUNT:
26 `
27 WHATCOM COUNTY, WASHINGTON (the "County"), hereby acknowledges itself to
28 owe and for value received promises to pay to the Registered Owner identified above, or
29 registered assigns, on the Maturity Date identified above, the Principal Amount indicated above
30 and to pay interest thereon from October 25 , 2010, or the most recent date to which interest has
31 been paid or duly provided for until payment of this bond at the Interest Rate set forth above,
32 payable on the first days of each June and December, commencing on December 1 , 2010. Both
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1 principal of and interest on this bond are payable in lawful money of the United States of
2 America. For so long as the bonds of this issue are held in fully immobilized form, payments of
3 principal and interest thereon shall be made as provided in accordance with the operational
4 arrangements of The Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter
5 of Representations (the "Letter of Representations") from the County to DTC . Initially, the
6 County' s Treasurer has specified and adopted the registration system for the bonds of this issue
7 specified by the State Finance Committee, and the fiscal agency of the State will act as registrar,
8 paying agent and authenticating agent (the "Bond Registrar") .
9
10 This bond is one of an authorized issue of bonds of like date and tenor, except as to
11 number, amount, rate of interest and date of maturity in the aggregate principal amount of
12 $4,310,000, and is issued to refund outstanding limited tax general obligation bonds of the
13 County and pay a portion of the costs of capital improvements to County facilities.
14 Simultaneously herewith, the County is issuing its Limited Tax General Obligation Bonds,
15 2010B (Taxable Recovery Zone Economic Development Bonds — Direct Payment) in the
16 principal amount of $ 1 , 825 ,000 .
17
18 The bonds of this issue are issued under and in accordance with the provisions of the
19 Constitution and applicable statutes of the State of Washington and ordinances duly adopted by
20 the County Council, including Ordinance No . 2010-040 of the County Council (the "Bond
21 Ordinance") . .
22
23 The bonds of this issue are not subject to optional redemption prior to their stated
24 maturities .
25
26 The bonds of this issue are not "private activity bonds" as such term is defined in the
27 Internal Revenue Code of 1986, as amended (the "Code") . The County has designated the bonds
28 of this issue as qualified tax-exempt obligations under Section 265 (b) of the Code for banks,
29 thrift institutions and other financial institutions.
30
31 The County hereby irrevocably covenants that it will levy taxes annually upon all the
32 • taxable property in the County within and as a part of the tax levy permitted to the County
33 without a vote of the electors in amounts sufficient, with other monies legally available therefor,
34 to pay the principal of and interest on the bonds of this issue as the same shall become due. The
35 full faith, credit and resources of the County are hereby irrevocably pledged for the annual levy
36 and collection of such taxes and the prompt payment of such principal and interest. The pledge
37 of tax levies may be discharged prior to maturity of the bonds of this issue by making provision
38 for the payment thereof on the terms and conditions set forth in the Bond Ordinance.
39
40 This bond shall not be valid or become obligatory for any purpose or be entitled to any
41 security or benefit under the Bond Ordinance until the Certificate of Authentication hereon shall
42 have been manually signed by the Bond Registrar.
43
44 It is hereby certified that all acts, conditions and things required by the Constitution and
45 statutes of the State of Washington to exist, to have happened, been done and performed
46 precedent to and in the issuance of this bond have happened, been done and performed and that
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1 the issuance of this bond and the bonds of this issue does not violate any constitutional, statutory
2 or other limitation upon the amount of bonded indebtedness that the County may incur.
3
4 IN WITNESS WHEREOF, Whatcom County, Washington has caused this bond to be
5 executed by the facsimile signatures of the Chair and Clerk of its County Council as of this 25th
6 day of October, 2010 .
7
8 WHATCOM COUNTY, WASHINGTON
9
•
10
11 By /s/ facsimile
12 Chair, County Council
13 ATTEST :
14 .
15
16 /s/ facsimile
17 Clerk, County Council
18
19 The Bond Registrar' s Certificate of Authentication on the 2010A Bonds shall be in
20 substantially the following form :
21
22 CERTIFICATE OF AUTHENTICATION
23
24 Date of Authentication:
25
26 This bond is one of the bonds described in the within-mentioned Bond Ordinance and is
27 one of the Limited Tax General Obligation and Refunding Bonds, 2010A of Whatcom County,
28 dated October 25 , 2010 .
29 WASHINGTON STATE FISCAL
30 AGENCY as Bond Registrar
31
32
33 By
34 Authorized Officer
35
•
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1 (b) 2010B Bonds. The 2010B Bonds shall be in substantially the following form:
2
3 UNITED STATES OF AMERICA
4 NO . $
5 STATE OF WASHINGTON
6 WHATCOM COUNTY
7 LIMITED TAX GENERAL OBLIGATION BOND, 2010B (TAXABLE RECOVERY ZONE
8 ECONOMIC DEVELOPMENT BOND — DIRECT PAYMENT)
9
10 INTEREST RATE : MATURITY DATE : CUSIP NO . :
11
12 REGISTERED OWNER: CEDE & Co .
13
14 PRINCIPAL AMOUNT :
15
16 WHATCOM COUNTY, WASHINGTON (the "County"), hereby acknowledges itself to
17 owe and for value received promises to pay to the Registered Owner identified above, or
18 registered assigns, on the Maturity Date identified above, the Principal Amount indicated above
19 and to pay interest thereon from October 25 , 2010, or the most recent date to which interest has
20 been paid or duly provided for until payment of this bond at the Interest Rate set forth above,
21 payable on the first days of each June and December, commencing on June 1 , 2011 . Both
22 principal of and interest on . this bond are payable in lawful money of the United States of
23 America. For so long as the bonds of this issue are held in fully immobilized form, payments of
24 principal and interest thereon shall be made as provided in accordance with the operational
25 arrangements of The Depository Trust Company ("DTC") referred to in the Blanket Issuer Letter
26 of Representations (the "Letter of Representations") from the County to DTC . Initially, the
27 County' s Treasurer has specified and adopted the registration system for the bonds of this issue
28 specified by the State Finance Committee, and the fiscal agency of the State will act as registrar,
29 paying agent and authenticating agent (the "Bond Registrar") .
30
31 This bond is one of an authorized issue of bonds of like date and tenor, except as to
32 number, amount, rate of interest and date of maturity in the aggregate principal amount of
33 $ 1 , 825 ,000, and is issued to fund capital improvements to County facilities . Simultaneously
34 herewith, the County is issuing its Limited Tax General Obligation and Refunding Bonds, 2010A
35 in the principal amount of $4,310,000 .
36
37 The bonds of this issue are issued under and in accordance with the provisions of the
38 Constitution and applicable statutes of the State of Washington and ordinances duly adopted by
39 the County Council, including Ordinance No . 2010-040 of the County Council (the "Bond
40 Ordinance") .
41
42 The bonds of this issue are subject to optional redemption, extraordinary optional
43 redemption and mandatory redemption prior to their stated maturities as described in the Bond
44 Ordinance.
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1
2 The County hereby irrevocably covenants that it will levy taxes annually upon all the
3 taxable property in the County within and as a part of the tax levy permitted to the County
4 without a vote of the electors in amounts sufficient, with other monies legally available therefor,
5 to-pay the principal of and interest on the bonds of this issue as the same shall become due. The
6 full faith, credit and resources of the County are hereby irrevocably pledged for the annual levy
7 and collection of such taxes and the prompt payment of such principal and interest. The pledge
8 of tax levies may be discharged prior to maturity of the bonds of this issue by making provision
9 for the payment thereof on the terms and conditions set forth in the Bond Ordinance.
10
11 This bond shall not be valid or become obligatory for any purpose or be entitled to any
12 security or benefit under the Bond Ordinance until the Certificate of Authentication hereon shall
13 have been manually signed by the Bond Registrar.
14
15 It is hereby certified that all acts, conditions and things required by the Constitution and
16 statutes of the State of Washington to exist, to have happened, been done and performed
17 precedent to and in the issuance of this bond have happened, been done and performed and that
18 the issuance of this bond and the bonds of this issue does not violate any constitutional, statutory
19 or other limitation upon the amount of bonded indebtedness that the County may incur.
20
21 IN WITNESS WHEREOF, Whatcom County, Washington has caused this bond to be
22 executed by the facsimile signatures of the Chair and Clerk of its County Council as of this 25th
23 day of October, 2010 .
24
25 WHATCOM COUNTY, WASHINGTON
26
27
28 By /s/ facsimile
29 Chair, County Council
30 ATTEST :
31
32
33 /s/ facsimile
34 Clerk, County Council .
35
36 The Bond Registrar' s Certificate of Authentication on the 2010B Bonds shall be in
37 substantially the following form: .
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1 CERTIFICATE OF AUTHENTICATION
2
3 Date of Authentication:
4
5 This bond is one of the bonds described in the within-mentioned Bond Ordinance and is
6 one of the Limited Tax General Obligation Bonds, 2010B (Taxable Recovery Zone Economic
7 Development Bonds — Direct Payment) of Whatcom County, dated October 25 , 2010 .
8
9 WASHINGTON STATE FISCAL
10 AGENCY as Bond Registrar
11
12
13 By
14 Authorized Officer
15
16 Section 6 . Execution of Bonds . The Bonds shall be executed on behalf of the County
17 with the manual or facsimile signature of the Chair of the Council, attested by the manual or
18 facsimile signature of the Clerk of the Council. In case either or both of the officers who have
19 signed or attested any of the Bonds cease to be such officer before such Bonds have been actually
20 issued and delivered, such Bonds shall be valid nevertheless and may be issued by the County
21 with the same effect as though the persons who had signed or attested such Bonds had not ceased
22 to be such officers, and any Bond may be signed or attested on behalf of the County by officers
23 who at the date of actual execution of such Bond are the proper officers, although at the nominal
24 date of execution of such Bond such officer was not an officer of the County.
25 Only Bonds that bear a Certificate of Authentication in the form set forth in Section 5 ,
26 manually executed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled
27 to the benefits of this ordinance. Such Certificate of Authentication shall be conclusive evidence
28 that the Bonds so authenticated have been duly executed, authenticated and delivered and are
29 entitled to the benefits of this ordinance.
-27- P:120287_CMVV20287_900 10/12/10
1 Section 7 . Application of Bond Proceeds and Redemption of the Refunded Bonds.
2 (a) Project Fund The Treasurer has heretofore established a special fund of the
3 County designated as the "2010 Jail Improvement Fund" (the "Project Fund") . The proceeds of
4 sale of the Improvement Bonds and the 201.0B Bonds shall be deposited in the Project Fund and
5 shall be expended solely to pay the cost of issuing and selling the Improvement Bonds and the
6 2010B Bonds and, together with other available moneys of the County, shall be used to pay the
7 costs of the Project. Money in the Project Fund shall be invested by the Treasurer, pending
8 disbursement, in any legal investment for County funds .
9 (b) Refunding Plan. The proceeds of sale of the Refunding Bonds shall be delivered
10 to the County. Money from the Refunding Bond proceeds and other money provided by the
11 County shall be used to pay and redeem the Refunded Bonds as authorized by Ordinance Nos .
12 97-009 and 98-084 and pay costs of issuance of the Refunding Bonds. The County shall provide
13 for the payment of:
14 ( 1 ) Interest on the Refunded Bonds which will become due on November 24,
15 2010 ; and
16 (2) The redemption price ( 100% of the principal amount thereof) on
17 November 24, 2010, of the Refunded Bonds.
18 (c) Redemption of the Refunded Bonds. The County hereby irrevocably calls for
19 redemption on November 24, 2010, the Refunded Bonds in accordance with Ordinance
20 Nos . 97-009 and 98-084. Such call for redemption shall be irrevocable upon the delivery of the
21 2010A Bonds to the initial purchasers thereof.
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1 The Treasurer, is hereby authorized and directed to provide for the giving of notice of the
2 redemption of such Refunded Bonds in accordance with the provisions of Ordinance Nos . 97-009
3 and 98 -084 .
4 Section 8 . Pledge of Taxes and Credit. The Treasurer is hereby authorized to
5 establish a special fund of the County to be designated as the 2010 General Obligation and
6 Refunding Bond Redemption Fund (the "Bond Fund") . On or before each date on which a
7 payment of principal of and interest on the Bonds is due and payable, the Treasurer shall deposit
8 the amount necessary to make such principal and/or interest payment into the Bond Fund and
9 shall remit the same to the Bond Registrar for the purpose of making such payment. The County
10 hereby irrevocably covenants that, unless the principal of and interest on the Bonds are paid from
11 other sources, it will make annual levies of taxes within and as a part of the tax levy permitted to
12 the County without a vote of its electors upon all of the property in the County subject to taxation
13 in amounts sufficient to pay such principal and interest as the same shall become due. The full
14 faith, credit and resources of the County are hereby irrevocably pledged for the annual levy and
15 collection of such taxes and for the prompt payment of such principal and interest.
16 Section 9 . Defeasance. In the event that money and/or Government Obligations
17 maturing at such time or times and bearing interest to be earned thereon. in amounts (together
18 with such money, if necessary) sufficient to redeem and retire part or all of the Bonds in
19 accordance with their terms, are set aside in a special account of the County to effect such
20 redemption and retirement, and such moneys and the principal of and interest on such obligations
21 are irrevocably set aside and pledged for such purpose, then no further payments need be made
22 into the Bond Fund for the payment of the principal of and interest on the Bonds so provided for,
23 and such Bonds shall cease to be entitled to any lien, benefit or security of this ordinance except
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1 the right to receive the moneys so set aside and pledged, and such Bonds shall be deemed not to
2 be outstanding hereunder.
3 Within 60 days of any defeasance of Bonds the Bond Registrar shall provide notice of
4 defeasance of Bonds to Registered Owners and to each party entitled to receive notice in
5 accordance with Section 11 of this ordinance .
6 Section 10 . Tax Covenants and Designation.
7 (a) Arbitrage Covenant. The County hereby covenants that it will not make any use
8 of the proceeds of sale of the Bonds or any other funds of the County which may be deemed to be
9 proceeds of such Bonds pursuant to Section 148 of the Code which will cause the Bonds to be
10 "arbitrage bonds" within the meaning of said section and said Regulations. The County will
11 comply with the requirements of Section 148 of the Code (or any successor provision thereof
12 applicable to the Bonds) and the applicable Regulations thereunder throughout the term of the
13 Bonds .
14 (b) Private Person Use Limitation for Bonds. The County covenants that for as long
15 as the Bonds are outstanding, it will not permit:
16 ( 1 ) More than 10% of the Net Proceeds of the Bonds to be used for any
17 Private Person Use; and
18 (2) More than 10% of the principal or interest payments on the Bonds in a
19 Bond Year to be directly or indirectly: (A) secured by any interest in property used or to be used
20 for any Private Person Use or secured by payments in respect of property used or to be used for
21 any Private Person Use, or (B) derived from payments (whether or not made to the County) in
22 respect of property, or borrowed money, used or to be used for any Private Person Use.
23 The County further covenants that, if:
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1 (3 ) More than five percent of the Net Proceeds of the Bonds are to be used for
2 any Private Person Use; and
3 (4) More than five percent of the principal or interest payments on the Bonds
4 in a Bond Year are (under the terms of this ordinance or any underlying arrangement) directly or
5 indirectly: (A) secured by any interest in property used or to be used for any Private Person Use
6 or secured by payments in respect of property used or to be used for any Private Person Use, or
7 (B) derived from payments (whether or not made to the County) in respect of property, or
8 borrowed money, used or to be used for any Private Person Use, then, (i) any Private Person Use
9 of the projects described in subsection (3) hereof or Private Person Use payments described in
10 subsection (4) hereof that is in excess of the five percent limitations described in such
11 subsections (3 ) or (4) will be for a Private Person Use that is related to the state or local
12 governmental use of the project financed or refinanced with Bond proceeds, and (ii) any Private
13 Person Use will not exceed the amount of Net Proceeds of the Bonds used for the state or local
14 • governmental use portion of the projects to which the Private Person Use of such portion of such
15 project relates. The County further covenants that it will comply with any limitations on the use
16 of the projects by other than state and local governmental users that are necessary, in the opinion
17 of its bond counsel, to comply with the requirements of the Code. The covenants of this section
18 are specified solely to assure compliance with the Code.
19 (c) Recovery Zone Economic Development Bonds Status. The County further
20 covenants not to take any action, or knowingly to omit to take any action within its control, that if
21 taken or omitted would cause the 2010B Bonds to lose their status as Recovery Zone Economic
22 Development Bonds .
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1 (3 ) 2010A Bonds Designated "Qualified Tax-Exempt Obligations. " The County
2 hereby designates the 2010A Bonds as "qualified tax-exempt obligations" for purchase by
3 financial institutions pursuant to Section 265 of the Code. The County does not anticipate
4 issuing more than $30,000,000 in qualified tax-exempt obligations during 2010 (excluding
5 obligations permitted by the Code to be excluded for purposes of the County' s qualification as a
6 qualified small issuer) .
7 Section 11 . Undertaking to Provide Ongoing Disclosure.
8 (a) Contract/Undertaking. This section constitutes the County' s written undertaking
9 for the benefit of the owners of the Bonds as required by Section (b)(5) of the Rule.
10 (b) Financial Statements/Operating Data. The County agrees to provide or cause to
11 be provided to the Municipal Securities Rulemaking Board ("MSRB"), the following annual
12 financial information and operating data for the prior fiscal year (commencing in 2011 for the
13 fiscal year ended December 31 , 2010) :
14 1 . Annual financial statements, which statements may or may not be audited,
15 showing ending fund balances for the County' s general fund prepared in accordance with the
16 Budgeting Accounting and Reporting System prescribed by the Washington State Auditor
17 pursuant to RCW 43 . 09 . 200 (or any successor statute) and generally of the type included in the
18 official statement for the Bonds under the heading "Comparative General Fund Statement of
19 Revenues, Expenditures and Changes in Fund Balance";
20 2 . The assessed valuation of taxable property in the County;
21 3 . Ad valorem taxes due and percentage of taxes collected;
22 4 . Property tax levy rate per $ 1 ,000 of assessed valuation; and
23 5 . Outstanding general obligation debt of the County.
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1 Items 2-5 shall be required only to the extent that such information is not included in the annual
2 financial statements .
3 The information and data described above shall be provided on or before nine months
4 after the end of the County' s fiscal year. The County' s current fiscal year ends December 31 .
5 The County may adjust such fiscal year by providing written notice of the change of fiscal year to
6 the MSRB . In lieu of providing such annual financial information and operating data, the County
7 may cross-refer to other documents available to the public on the MSRB ' s interne website.
8 If not provided as part of the annual financial information discussed above, the County
9 shall provide the County' s audited annual financial statement prepared in accordance with the
10 Budgeting Accounting and Reporting System prescribed by the Washington State Auditor
11 pursuant to RCW 43 . 09 .200 (or any successor statute) when and if available to the MSRB .
12 (c) Material Events. The County agrees to provide or cause to be provided, in a
13 timely manner, to the MSRB notice of the occurrence of any of the following events with respect
14 . to the Bonds, if material : .
15 • Principal and interest payment delinquencies;
16 • Non-payment related defaults;
17 • . Unscheduled draws on debt service reserves reflecting financial difficulties;
18 • Unscheduled draws on credit enhancements reflecting financial difficulties ;
19 • Substitution of credit or liquidity providers, or their failure to perform;
20 • Adverse tax opinions or events affecting the tax-exempt status of the Bonds ;
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1 • Modifications to the rights of Bond owners;
2 • Bond calls (optional, contingent or unscheduled Bond calls other than scheduled
3 sinking fund redemptions for which notice is given pursuant to Exchange Act
4 Release 34-23856) ;
5 • Defeasances;
6 • Release, substitution or sale of property securing repayment of the Bonds; and
7 • Rating changes .
8 Solely for purposes of disclosure, and not intending to modify this undertaking, the
9 County advises that no debt service reserves, credit enhancement or property secures payment of
10 the Bonds.
11 (d) Notification Upon Failure to Provide Financial Data. The County agrees to
12 provide or cause to be provided, in a timely manner to the MSRB notice of its failure to provide
13 the annual financial information described in Subsection (b) above on or prior to the date set
14 forth in Subsection (b) above.
15 (e) • Emma; Format for Filings with the MSRB. Until otherwise designated by the
16 MSRB or the Commission, any information or notices submitted to the MSRB in compliance
17 with the Rule are to be submitted through the MSRB ' s Electronic Municipal Market Access
18 system ("EMMA"), currently located at www. emma.msrb. org. All notices, financial information
19 and operating data required by this undertaking to be provided to the MSRB must be in an
20 electronic format as prescribed by the MSRB . All documents provided to the MSRB pursuant to
21 this undertaking must be accompanied by identifying information as prescribed by the MSRB .
22 (f) Termination/Modification. The County' s obligations to provide annual financial
23 information and notices of material events shall terminate upon the legal defeasance, prior
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1 redemption or payment in full of all of the Bonds. Any provision of this section shall be null and
2 void if the County ( 1 ) obtains an opinion of nationally recognized bond counsel to the effect that
3 the portion of the Rule that requires that provision is invalid, has been repealed retroactively or
4 otherwise does not apply to the Bonds and (2) notifies the MSRB of such opinion and the
5 cancellation of this section.
6 , The County may amend this section with an opinion of nationally recognized bond
7 counsel in accordance with the Rule. In the event of any amendment of this section, the County
8 shall describe such amendment in the next annual report, and shall include, a narrative
9 explanation of the reason for the amendment and its impact on the type (or in the case of a
10 change of accounting principles, on the presentation) of financial information or operating data
11 being presented by the County. In addition, if the amendment relates to the accounting principles
12 to be followed in preparing financial statements, (i) notice of such change shall be given in the
13 same manner as for a material event under Subsection (c), and (ii) the annual report for the year
14 in which the change is made shall present a comparison (in narrative form and also, if feasible, in
15 quantitative form) between the financial statements as prepared on the basis of the new
16 accounting principles and those prepared on the basis of the former accounting principles.
17 (g) Bond Owner 's Remedies Under This Section . The right of any bondowner or
18 beneficial owner of Bonds to enforce the provisions of this section shall be limited to a right to
19 obtain specific enforcement of the County' s obligations under this section, and any failure by the
20 County to comply with the provisions of this undertaking shall not be an event of default with
21 respect to the Bonds . For purposes of this section, "beneficial owner" means any person who has
22 the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of,
23 any Bonds, including persons holding Bonds through nominees or depositories .
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1 (h) No Default. The County is not and has not been in default in the performance of
2 its obligations of any prior undertaking for ongoing disclosure with respect to its obligations .
3 Section 12 . Lost or Destroyed Bonds . If any Bonds are lost, stolen or destroyed, the
4 Bond Registrar may authenticate and deliver a new Bond or Bonds of like amount, maturity and
5 tenor to the Registered Owner upon the owner paying the expenses and charges of the Bond
6 Registrar and the County in connection with preparation and authentication of the replacement
7 Bond or Bonds and upon his or her filing with the Bond Registrar and the County evidence
8 satisfactory to both that such Bond or Bonds were actually lost, stolen or destroyed and of his or
9 her ownership, and upon furnishing the County and the Bond Registrar with indemnity
10 satisfactory to both.
11 Section 13 . Sale of Bonds. The Bonds shall be sold by negotiated sale to the
12 Underwriter, under the terms and conditions thereof as provided in its purchase contract
13 presented to the Council on this date and in this ordinance. Said purchase contract is hereby in
14 all respects accepted and approved, and either the County Executive or the Chair of the Council
15 is authorized to execute the purchase contract on behalf of the County.
16 The County Executive is hereby authorized to review and approve on behalf of the
17 County the preliminary and final Official Statements relative to the Bonds with such additions
18 and changes as may be deemed necessary or advisable to him. The Preliminary Official
19 Statement for the Bonds, is hereby deemed final for purposes of the Rule. The proper County
20 officials are hereby authorized and directed to do everything necessary for the prompt execution
21 and delivery of the Bonds to the Underwriter and for the proper application and use of the
22 proceeds of sale thereof
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1 Section 14 . Severability. If any one or more of the covenants or agreements provided
2 in this ordinance to be performed on the part of the County shall be declared by any court of
3 competent jurisdiction to be contrary to law, then such covenant or covenants, agreement or
4 agreements, shall be null and void and shall be deemed separable from the remaining covenants
5 and agreements of this ordinance and shall in no way affect the validity of the other provisions of
6 this ordinance or of the Bonds .
-37- P:120287_CMM20287 900 10/12/10
•
1 Section 15 . Effective Date. This ordinance shall become effective immediately upon
2 its adoption. `
3 ADOPTED this 12th day of October, 2010.
COUNTY COUNCIL OF
WHATCOM COUNTY, WASHINGTON
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Councilmember
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Councilmember
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ATT,.. J F w Nigro' % APPROVED DENIED _
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O of t e unity C iuncil / County Executive
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Dated as of: /0 —gt �O , 2010
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-38- P:120287 CM1M20287_900 10/12/10
CERTIFICATE
I, the undersigned, Clerk of the County Council of Whatcom County, Washington, (the
"County") and keeper of the records of the County Council ("Council"), DO HEREBY
CERTIFY :
1 . That the attached ordinance is a true and correct copy of Ordinance No . 2010-040
of the Council (herein called the "Ordinance"), duly adopted at a regular meeting thereof held on
the 12th day of October, 2010 .
2 . That said meeting was duly convened and held in all respects in accordance with
law, and to the extent required by law, due and proper notice of such regular meeting was given;
that a legal quorum was present throughout the meeting and a legally sufficient number of
members of the Council voted in the proper manner for the adoption of the Ordinance ; that all
other requirements and proceedings incident to the proper adoption of the Ordinance have been
duly fulfilled, carried out and otherwise observed; and that I am authorized to execute this
certificate. ```��� � ► ���
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IN WITNESS WHEREOF, I have hereunto set my hag .b1tabyt2b4bber, 2010 .
COVN-ne
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P:120287 CMW120287 900 10/12/10