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Ordinance No. 00464

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City Council meeting minutes of Jan 7 2008

CITY OF LAKEWOOD, WASHINGTON

ORDINANCE NO.464

AN ORDINANCE relating to Local Improvement District No.E1108; fixing the amount, form, date, interest rates, maturity and denominations of the Local Improvement District No.E1108 Bonds; providing for the sale and delivery thereof to Cashmere Valley Bank in Cashmere, Washington; and fixing the interest rate on Local Improvement District No.E1108 assessment installments.

PASSED JANUARY 7, 2008

This document prepared by:

Foster Pepper PLLC
1111 Third Avenue, Suite 3400
Seattle, Washington 98101
(206) 447-4400


CITY OF LAKEWOOD, WASHINGTON

ORDINANCE NO.464

TABLE OF CONTENTS*

NOTE: After generating TOC, select TOC and do a Find/Replace: ?space period tab?, replace with ?period tab? (to get rid of the extra space following the Section#).

Page

Section1...... Authorization and Description of Bonds.................................................... 1

Section2...... Registration and Transfer of Bonds; Bond Registrar.................................... 2

Section3...... Bond Registrar.................................................................................... 3

Section4...... Payment of Bonds............................................................................... 3

Section5...... Prepayment and Redemption Provisions................................................... 3

Section6...... Failure to Redeem Bonds....................................................................... 4

Section7...... Pledge of Assessment Payments............................................................ 4

Section8...... Form and Execution of Bonds................................................................. 4

Section9...... Preservation of Tax Exemption for Interest on Bonds.................................. 5

Section10.... Small Governmental Issuer Arbitrage Rebate Exception and Designation of Bonds as ?Qualified Tax Exempt Obligations.?......................................................... 5

Section11.... Use of Bond Proceeds.......................................................................... 6

Section12.... Approval of Bond Purchase Offer............................................................ 6

Section13.... Fixing Interest Rate on Assessments....................................................... 7

Section14.... Effective Date of Ordinance.................................................................. 7


CITY OF LAKEWOOD, WASHINGTON

ORDINANCE NO. 464

AN ORDINANCE relating to Local Improvement District No.E1108; fixing the amount, form, date, interest rates, maturity and denominations of the Local Improvement District No.E1108 Bonds; providing for the sale and delivery thereof to Cashmere Valley Bank in Cashmere, Washington; and fixing the interest rate on Local Improvement District No.E1108 assessment installments.

THE CITY COUNCIL OF THE CITY OF LAKEWOOD, WASHINGTON, DO ORDAIN as follows:

Section1. Authorization and Description of Bonds. The total amount of the assessment roll in Local Improvement District No.E1108 (the ?District?) in the City of Lakewood, Washington (the ?City?), created under Ordinance No.391, passed August15, 2005, was $880,000. The 30-day period for making cash payments of assessments without interest in the District expired on November5, 2007, and no assessments were paid in cash, leaving a balance of assessments unpaid on the assessment roll in the sum of $880,000. Local Improvement District No.E1108 Bonds (the ?Bonds?) shall, therefore, be issued in the total principal sum of $880,000.

Cashmere Valley Bank of Cashmere, Washington (the ?Bank?) has offered to purchase the Bonds under the terms of its purchase offer dated January 7, 2008 (the ?Offer?), and this Ordinance. The Bonds shall be dated their date of issuance, shall mature on December1, 2027, and shall be numbered separately as set forth below in the manner and with any additional designation as the Bond Registrar (the Finance Director of the City, who is hereby appointed as Bond Registrar, located in Lakewood, Washington) deems necessary for the purpose of identification; and shall bear interest from their date to the maturity or earlier redemption of the Bonds, payable annually on each December1, beginning December1, 2008 (the ?Interest Payment Date?), at the rates per annum shown on the following Estimated Redemption Schedule:

ESTIMATED REDEMPTION SCHEDULE

Estimated December1 Redemption Dates

Bond Number

Amounts

Interest Rates

2008

R-1

$48,000

4.22%

2009

R-2

$48,000

4.31%

2010

R-3

$48,000

4.38%

2011

R-4

$48,000

4.44%

2012

R-5

$48,000

4.51%

2013

R-6

$48,000

4.59%

2014

R-7

$48,000

4.67%

2015

R-8

$48,000

4.73%

2016

R-9

$48,000

4.82%

2017

R-10

$48,000

4.91%

2018

R-11

$50,000

4.98%

2019

R-12

$50,000

5.05%

2020

R-13

$50,000

5.09%

2021

R-14

$50,000

5.16%

2022

R-15

$50,000

5.21%

2023

R-16

$50,000

5.25%

2024

R-17

$50,000

5.27%

2025

R-18

$50,000

5.30%

Principal is payable at maturity or early prepayment.

Section2. Registration and Transfer of Bonds; Bond Registrar. The Bonds shall be issued to the Bank only in registered form as to both principal and interest and shall be recorded on books or records maintained by the Bond Registrar (the ?Bond Register?). The Bond Register shall contain the name and mailing address of the owner of the Bonds and the principal amount and number of the Bonds.

The Bonds may be assigned or transferred only in whole by the registered owner to a single investor that is a financial institution or a person who is reasonably believed to be a qualified institutional buyer or accredited investor within the meaning of the applicable federal securities laws. Any transfer shall be without cost to the owner or transferee, except for governmental charges imposed on any such transfer or exchange. The Bond Registrar shall not be obligated to exchange or transfer any Bond during the 15 days preceding any interest payment or prepayment date. When the Bonds have been paid in full, both principal and interest, the Bonds shall be surrendered to the Bond Registrar, who shall cancel the Bonds.

Section3. Bond Registrar. The Bond Registrar shall keep, or cause to be kept, sufficient books for the registration and transfer of the Bonds. The Bond Registrar shall serve as the City?s authenticating agent, transfer agent, Registrar and paying agent for the Bonds and shall comply fully without applicable federal and state laws and regulations respecting the carrying out of those duties. The Bond Registrar is authorized, on behalf of the City, to authenticate and deliver Bonds in accordance with the provisions of the Bonds and this ordinance, to serve as the City?s paying agent for the Bonds and to carry out all of the Bond Registrar?s powers and duties under this ordinance and City Ordinance No.430 establishing a system of registration for the City?s bonds and obligations.

The Bonds shall state on their face that the principal of and interest on the Bonds shall be paid only to the owner thereof registered as such on the Bond Register as of the record date set forth therein and to no other person or entity, and that the Bonds may not be assigned except on the books of the Bond Registrar.

Section4. Payment of Bonds. Both principal of and interest on the Bonds shall be payable solely out of the Local Improvement Fund, District No.E1108 (the ?Bond Fund?), and from the Local Improvement Guaranty Fund of the City pursuant to Chapter 35.54 RCW, and shall be payable in lawful money of the United States of America. Interest on the Bonds shall be paid by checks or drafts mailed, or by electronic transfer, to the Bank on the Interest Payment Date at the address appearing on the Bond Register. Principal of the Bonds at maturity or prior repayment is payable at the office of the Bond Registrar in Lakewood, Washington, upon presentation and surrender of the Bonds.

Section5. Prepayment and Redemption Provisions. On each Interest Payment Date, the City shall apply all amounts remaining in the Bond Fund after payment of accrued interest to the prepayment at par of outstanding principal of the Bonds, in whole or in part, in numerical order. Interest on the Bonds or the portion thereof so prepaid shall cease to accrue on the date of such prepayment.

Bonds redeemed under this section shall be cancelled.

Section6. Failure to Redeem Bonds. If the Bonds are not redeemed when properly presented at their maturity or prepayment date, the City shall be obligated to pay interest on the Bonds at the same rate provided in the Bonds from and after their maturity or prepayment date until the Bonds, both principal and interest, are paid in full or until sufficient money for their payment in full is on deposit in the Bond Fund and the Bonds have been called for payment.

Section7. Pledge of Assessment Payments. Assessments collected in the District, together with interest and penalties, if any, are pledged to the payment of the Bonds which are payable solely out of the Bond Fund and the Local Improvement Guaranty Fund of the City in the manner provided by law. The Bonds are not general obligations of the City.

Section8. Form and Execution of Bonds. The Bonds shall be printed, lithographed or typed on good bond paper in a form consistent with the provisions of this ordinance and state law, shall be signed by the Mayor and the City Clerk, either or both of whose signatures may be manual or in facsimile, and the seal of the City or a facsimile reproduction thereof shall be impressed or printed thereon.

The Bonds shall thereon bear a Certificate of Authentication in the following form, manually signed by the Bond Registrar, and only if so executed, shall be valid or obligatory for any purpose or entitled to the benefits of this ordinance:

CERTIFICATE OF AUTHENTICATION

This Bond is one of the fully registered City of Lakewood, Washington, Local Improvement District No.E1108 Bonds described in the Bond Ordinance.

By

Finance Director of the City of Lakewood, Washington, Bond Registrar

The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered and is entitled to the benefits of this ordinance.

If any officer whose facsimile signature appears on the Bonds ceases to be an officer of the City authorized to sign bonds before the Bonds bearing his or her facsimile signature are authenticated or delivered by the Bond Registrar or issued by the City, those Bonds nevertheless may be authenticated, issued and delivered and, when authenticated, issued and delivered, shall be as binding on the City as though that person had continued to be an officer of the City authorized to sign bonds. The Bonds also may be signed on behalf of the City by any person who, on the actual date of signing of the Bond, is an officer of the City authorized to sign bonds, although he or she did not hold the required office on the date of issuance of the Bond.

Section9. Preservation of Tax Exemption for Interest on Bonds. The City covenants that it will take all actions necessary to prevent interest on the Bonds from being included in gross income for federal income tax purposes, and it will neither take any action nor make or permit any use of proceeds of the Bonds or other funds of the City treated as proceeds of the Bonds at any time during the term of the Bonds which will cause interest on the Bonds to be included in gross income for federal income tax purposes.

Section10. Small Governmental Issuer Arbitrage Rebate Exception and Designation of Bonds as ?Qualified Tax Exempt Obligations.? The City finds and declares that (a)it is a duly organized and existing governmental unit of the State of Washington and has general taxing power; (b)no Bond which is part of this issue of Bonds is a ?private activity bond? within the meaning of Section141 of the United States Internal Revenue Code of 1986, as amended (the ?Code?); (c)at least 95% of the net proceeds of the Bonds will be used for local governmental activities of the City (or of a governmental unit the jurisdiction of which is entirely within the jurisdiction of the City); (d)the aggregate face amount of all tax exempt obligations (other than private activity bonds and other obligations not required to be included in such calculation) issued by the City and all entities subordinate to the City (including any entity which the City controls, which derives its authority to issue tax exempt obligations from the City or which issues tax exempt obligations on behalf of the City) during the calendar year in which the Bonds are issued is not reasonably expected to exceed $5,000,000; and (e)the amount of tax exempt obligations, including the Bonds, designated by the City as ?qualified tax exempt obligations? for the purposes of Section265(b)(3) of the Code during the calendar year in which the Bonds are issued does not exceed $10,000,000. The City therefore certifies that the Bonds are eligible for the arbitrage rebate exception under Section148(f)(4)(D) of the Code and designates the Bonds as ?qualified tax exempt obligations? for the purposes of Section265(b)(3) of the Code.

Section11. Use of Bond Proceeds. The principal proceeds of the Bonds shall be used to repay certain City interfund loans issued as interim financing for District improvements, fund a portion of the City?s Local Improvement Guaranty Fund by the deposit therein at closing of the sum of $88,000.00, to pay any remaining unpaid and proper costs of the District, and to pay the costs of issuance of the Bonds. Until needed to pay those costs, the City may invest principal proceeds temporarily in any legal investment, and the investment earnings may be retained in the Bond Fund and be spent for the purposes of that fund.

Section12. Approval of Bond Purchase Offer. Cashmere Valley Bank of Cashmere, Washington, has presented the Offer to the City offering to purchase the Bonds under the terms and conditions provided in the Offer, which written Offer is on file with the City Finance Director and is incorporated herein by this reference. The City Council finds that entering into the Offer is in the City?s best interest and therefore accepts the Offer contained therein and authorizes its execution by a proper City official.

A loan fee of $8,800 shall be paid to the Bank at closing and may be paid from bond proceeds or other money of the City.

The Bonds will be printed at City expense and will be delivered to the purchaser in accordance with the Offer, together with the approving legal opinion of Foster Pepper PLLC, municipal bond counsel, regarding the Bonds.

The proper City officials are authorized and directed to do everything necessary for the prompt delivery of the Bonds to the purchaser, and for the proper application and use of the proceeds of the sale thereof.

Section13. Fixing Interest Rate on Assessments. The interest rate on the installments and delinquent payments of the special assessments in the District is revised and fixed at the rate of 5.67% per annum.

Section14. Effective Date of Ordinance. This ordinance shall take effect and be in force from and after its passage and five days following its publication as required by law.

PASSED by the City Council of the City of Lakewood, Washington, at a regular open public meeting thereof, on the 7th day of January, 2008.

,Mayor

ATTEST:

Alice Bush, MMC, City Clerk

APPROVED AS TO FORM:

Michael McKenzie, Acting City Attorney


CERTIFICATION

I, the undersigned, City Clerk of the City of Lakewood, Washington (the ?City?), hereby certify as follows:

1. The attached copy of Ordinance No.464 (the ?Ordinance?) is a full, true and correct copy of an ordinance duly passed at a regular meeting of the City Council of the City held at the regular meeting place thereof on January 7, 2008, as that ordinance appears on the minute book of the City; and the Ordinance will be in full force and effect five days after publication in the City?s official newspaper; and

2. A quorum of the members of the City Council was present throughout the meeting and a majority of those members present voted in the proper manner for the passage of the Ordinance.

IN WITNESS WHEREOF, I have hereunto set my hand this 7th day of January, 2008.

CITY OF LAKEWOOD, WASHINGTON

Alice Bush, MMC, City Clerk



* The cover page, table of contents and section captions of this ordinance are for convenience of reference only, and shall not be used to resolve any question of interpretation of this ordinance..