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HomeMy WebLinkAbout2022 Ordinance No. 0284885-8893-9034.2 BY AUTHORITY ORDINANCE NO. 28 COUNCIL BILL NO. 29 SERIES OF 2022 INTRODUCED BY COUNCIL MEMBER WOODWARD AN ORDINANCE OF THE CITY OF ENGLEWOOD, ACTING BY AND THROUGH ITS STORM WATER ENTERPRISE, AUTHORIZING A LOAN FROM THE COLORADO WATER RESOURCES AND POWER DEVELOPMENT AUTHORITY FOR THE PURPOSE OF FINANCING CAPITAL IMPROVEMENTS FOR USE IN ITS STORM WATER SYSTEM; AUTHORIZING THE EXECUTION OF A LOAN AGREEMENT AND BOND TO DOCUMENT THE LOAN; AND PROVIDING FOR THE PAYMENT OF THE BOND FROM THE OPERATION AND USE OF THE STORM WATER SYSTEM. WHEREAS, the City of Englewood, Colorado, is a home rule municipality and political subdivision of the State of Colorado, duly organized and operating under the constitution and laws of the State of Colorado and the City Charter (unless otherwise indicated, capitalized terms used in this preamble shall have the meanings set forth in Section 1 of this Ordinance); and WHEREAS, as established by City Ordinance No. 20, Series of 1993 and codified in Title 12, Chapter 5 of the City of Englewood Municipal Code 2000, the City has established its Storm Water Enterprise; and WHEREAS, the financial activities of the Storm Water Enterprise are accounted for in the Storm Water Drainage Fund; and WHEREAS, as provided in Section 12-5-3(A) of the City of Englewood Municipal Code 2000 there is imposed on every lot or parcel of land within the City a storm drainage service charge which is reviewed annually and set from time to time by ordinance of the City; and WHEREAS, the Storm Water Enterprise constitutes a “water activity enterprise” within the meaning of the Title 37, Article 45.1, C.R.S., and a government owned business which is authorized to issue its own revenue bonds and which receives under 10% of annual revenue in grants from all Colorado state and local governments combined; and WHEREAS, to finance the estimated costs of new storm sewer pipelines, rehabilitation of existing storm sewer pipelines, construction of a vegetated swale, and construction, including land acquisition, of a new water quality detention pond, the City Council has determined to enter into Loan Agreement with the Colorado Water Resources and Power Development Authority, a body corporate and political subdivision of the State, pursuant to which CWRPDA is to make a loan to the City in an aggregate principal amount not to exceed $26,000,000; and DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 2 4885-8893-9034.2 WHEREAS, the City’s repayment obligation under the Loan Agreement will be evidenced by governmental agency bond to be issued by the City to the CWRPDA, which Bond shall constitute special revenue obligation of the City which is to be paid from the income and revenues derived from the operation and use of the Storm Water System less reasonable and necessary current expenses of the City of operating, maintaining and repairing the Storm Water System and, after consideration, the City Council has determined that the execution of the Loan Agreement and the issuance of the Bond to the CWRPDA is to the best advantage of the City; and WHEREAS, as an obligation of the Storm Water Enterprise voter approval is not required under Article X, Section 20 of the Colorado Constitution for the execution of the Loan Agreement or the issuance of the Bond; and WHEREAS, as of the date of adoption of this Ordinance, the City has Storm Water Enterprise Revenue Bonds, Series 2021 which are payable from and secured by the Net Revenue of the Storm Water System; and WHEREAS, there has been made available to the City Council the form of the Loan Agreement and the Bond. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ENGLEWOOD, COLORADO, AS FOLLOWS: Section 1. Definitions. The following terms shall have the following meanings as used in this Ordinance: “Bond” means the governmental agency bond to be issued by the City to the CWRPDA pursuant to the Loan Agreement, the form of which is set forth in Exhibit D to the Loan Agreement. “Capital Improvements” means the acquisition of land, easements, facilities and equipment (other than ordinary repairs and replacements), and the construction or reconstruction of improvements, betterments and extensions, for use by or in connection with the Storm Water System which, under Generally Accepted Accounting Principles for governmental units as prescribed by the Governmental Account Standards Board, are properly chargeable as capital items. “City” means the City of Englewood, Colorado, acting by and through its Storm Water Enterprise. “City Charter” means the home rule Charter of the City. “Council” means the City Council of the City, acting as the governing body of the Storm Water Enterprise. “C.R.S.” means the Colorado Revised Statutes, as amended and supplemented. “CWRPDA” means the Colorado Water Resources and Power Development Authority, a body corporate and political subdivision of the State. DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 3 4885-8893-9034.2 “Enabling Law” means the City Charter; Title 12, Chapter 5 of the City of Englewood Municipal Code 2000; Title 37, Article 45.1, C.R.S.; Title 31, Article 35, Part 4, C.R.S.; Title 11, Article 57, Part 2, C.R.S.; and all other laws of the State establishing the power of the City to complete the financing contemplated by this Ordinance. “Financing Documents” means the Loan Agreement and the Bond. “Future Parity Obligations” means one or more series of additional bonds, notes, interim securities or other obligations issued by the City having a lien on the Net Revenue which is on a parity with the lien of the Bond and the Series 2021 Bonds. “Gross Revenue” means all income and revenues directly or indirectly derived by the City from the operation and use of the Storm Water Enterprise, including without limitation, any rates, fees and charges for the services furnished by, or the use of, the Storm Water Enterprise, and all income attributable to any past or future dispositions of property or rights or related contracts, settlements or judgments held or obtained in connection with the Storm Water Enterprise or its operations, and including investment income accruing from moneys held to the credit of the Storm Water Drainage Fund; provided however, that there shall be excluded from Gross Revenue any moneys borrowed and used for providing Capital Improvements; any money and securities, and investment income therefrom, in any refunding fund, escrow account or similar account pledged to the payment of any bonds or other obligations; and any moneys received as grants or appropriations from the United States, the State of Colorado or other sources, the use of which is limited or restricted by the grantor or donor to the provision of Capital Improvements or for other purposes resulting in the general unavailability thereof, except to the extent any such moneys shall be received as payments for the use of the Storm Water System, services rendered thereby, the availability of any such service or the disposal of any commodities therefrom. “Loan Agreement” means the Loan Agreement between the City and the CWRPDA pursuant to which the CWRPDA is to make a loan from its Water Pollution Control Revolving Fund to the City. “Net Revenue” means the Gross Revenue after deducting Operation and Maintenance Expenses. “Operation and Maintenance Expenses” means all reasonable and necessary current expenses of the City, paid or accrued, for operating, maintaining and repairing the Storm Water System, including without limitation legal and overhead expenses of the City directly related to the administration of the Storm Water Enterprise, insurance premiums, audits, charges of depository banks and paying agents, professional services, salaries and administrative expenses, labor and the cost of materials and supplies for current operation; provided however, that there shall be excluded from Operation and Maintenance Expenses any allowance for depreciation, payments in lieu of taxes or franchise fees, legal liabilities not based on contract, expenses incurred in connection with Capital Improvements, payments due in connection with any bonds or other obligations, and charges for the accumulation of reserves. "Prime Rate" means the prevailing commercial interest rate established pursuant to the terms of the Loan Agreement. DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 4 4885-8893-9034.2 “Project” means new storm sewer pipelines, rehabilitation of existing storm sewer pipelines, construction of a vegetated swale, and construction, including land acquisition, of a new water quality detention pond as set forth in the Loan Agreement and as the Project may be later modified by determination of the City Council. “Project Costs” means the City’s costs properly attributable to the Project, or any parts thereof, and permitted by the provisions of the Financing Documents and the Enabling Law. “Pro Rata Portion” means, when used with respect to a required credit to the accounts or subaccounts established for the payment of the principal of and interest on the Bond, the Series 2021 Bonds and any Future Parity Obligations, the dollar amount derived by dividing the amount of principal or interest to come due on the next principal or interest payment date by the number of monthly credits required to be made prior to such payment dates. “Series 2021 Bonds” means the Storm Water Enterprise Revenue Bonds, Series 2021, issued by the City, acting by and through its Storm Water Enterprise, pursuant to City Ordinance No. 12, Series of 2021. “State” means the State of Colorado. “Storm Water Drainage Fund” means the Storm Drainage Fund of the City which accounts for the financial activity of the Storm Water Enterprise. “Storm Water Enterprise” means the Storm Water Enterprise as established by City Ordinance No. 20, Series of 1993, as said ordinance may be amended from time to time. “Storm Water System” means all storm water facilities of the City, including without limitation interests in real and personal property now owned or hereafter acquired, whether situated within or without the City boundaries and all present or future improvements, extensions, enlargements, betterments, replacements and additions thereto. Section 2. Approval of Loan Agreement and Authorization of Bond. Pursuant to and in accordance with the State Constitution and the Enabling Law, the Bond shall be issued by the City acting by and through its Storm Water Enterprise. The form of the Loan Agreement setting forth the terms, conditions and details of the Bond and the procedures relating thereto, is incorporated herein by reference and is hereby approved; all City officials and employees are hereby directed to take such actions as are necessary and appropriate to fulfill the obligations of the City under the Financing Documents. The City shall enter into the Loan Agreement and deliver the Bond in substantially the form presented to the City at or prior to this meeting of the City Council with only such changes as are not inconsistent herewith; provided that such documents may be completed, corrected, or revised as deemed necessary by the parties thereto in order to carry out the purposes of this Ordinance. The accomplishment of the Project and the payment of Project Costs are hereby authorized, approved, and ordered. It is hereby determined that the date of final maturity of the Bond does not exceed the estimated life of the Project. Section 3. Details for Bond. The Bond shall be in substantially the form set forth in Exhibit D to the Loan Agreement with such changes thereto, not inconsistent herewith, as may be necessary or desirable and approved by the officials of the City executing the same (whose manual or facsimile DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 5 4885-8893-9034.2 signatures thereon shall constitute conclusive evidence of such approval). The Bond shall be in an aggregate principal amount not to exceed $26,000,000, shall bear interest at a net effective rate of two and one-quarter percent (2.25%) per annum, and shall be payable semi-annually and mature not more than twenty-one years from the date of its issuance as more particularly set forth in the Loan Agreement. The Bond may provide for a late charge (penalty interest rate) in an amount equal to the greater of twelve percent (12%) per annum or the Prime Rate plus one half of one percent per annum on late payments; provided however, such late charge rate shall not exceed the maximum rate permitted by law. Section 4. Pledge for Payment of the Bond. (a) Pledge of Net Revenue. Net Revenue is hereby pledged to the payment of the Bond and the amounts due under the Loan Agreement. The Bond shall constitute a first lien upon the Net Revenue, but not necessarily an exclusive first lien. Pursuant to and in accordance with Section 11-57-208, C.R.S., Net Revenue, as received by or otherwise credited to the City, shall immediately be subject to the lien of the pledge stated above without any physical delivery, filing, or further act. The lien of each such pledge, and the obligation to perform the contractual provisions made in this Ordinance and the Financing Documents, shall have priority over any or all other obligations and liabilities of the City except as may be otherwise provided in this Ordinance or in the Financing Documents. The lien of the above pledge shall be valid, binding, and enforceable as against all persons having claims of any kind in tort, contract, or otherwise against the City irrespective of whether such persons have notice of such liens. (b) Establishment of Accounts. There is hereby reaffirmed the Storm Water Drainage Fund which shall continue to be maintained by the City to carry out the terms and provisions of this Ordinance and the Loan Agreement. (c) Flow of Funds. The City shall credit to the Storm Water Drainage Fund all Gross Revenue immediately upon receipt. The City shall pay from the Storm Water Drainage Fund all Operation and Maintenance Expenses as they become due and payable. After such payment or the allocation of Gross Revenue to such payment, the City shall apply the Net Revenue in the following order of priority: FIRST, to the credit of or deposit in the accounts or subaccounts established for the payment of interest on the Bond, the Series 2021 Bonds and any Future Parity Obligations, the Pro Rata Portion equal to the interest coming due on the next succeeding interest payment date for the respective obligations; SECOND, to the credit of or deposit in the accounts or subaccounts established for the payment of principal of the Bond, the Series 2021 Bonds and any Future Parity Obligations, the Pro Rata Portion equal to the principal coming due on the next succeeding principal payment date for the respective obligations; THIRD, to the credit of any reserve accounts established for the payment of the Bond, the Series 2021 Bonds and any Future Parity Obligations, the amounts required in the ordinances or related documents authorizing and controlling the establishment of such reserve accounts; DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 6 4885-8893-9034.2 FOURTH, to the credit of or deposit in the accounts or subaccounts established for the payment of principal of and interest on other obligations the payment of which is subordinate to the payment of the Bond, the Pro Rata Portion equal to the principal of or interest on such obligations coming due on the next succeeding payment date for the respective obligations; and FIFTH, to the credit of any other fund or account as may be designated by the City, to be used for any lawful purpose, any moneys remaining in the Storm Water Drainage Fund after the payments and accumulations set forth in FIRST through FOURTH hereof. (d) The Bond Does Not Constitute a Debt. The CWRPDA may not look to any general or other fund of the City for the payment of the principal of or interest on the Bond, except the funds and accounts pledged thereto pursuant to authority of this Ordinance, and the Bond shall not constitute a debt or an indebtedness of the City within the meaning of any constitutional or statutory provision or limitation; nor shall they be considered or held to be a general obligation of the City. Section 5. Various Findings, Determinations, Declarations and Covenants. The City Council, having been fully informed of and having considered all the pertinent facts and circumstances, hereby affirms the covenants set forth in Section 2.02 of the Loan Agreement and further finds, determines, declares and covenants that: (a) Additional Obligations. No bonds, notes, interim securities or other obligations shall be issued payable from the Net Revenue and having a lien thereon which is superior to, on a parity with, or subordinate to the lien of the Bond unless the requirements set forth in EXHIBIT F of the Loan Agreement, under caption titled “Additional Bonds”, have been met. (b) Maintenance of Rates and Coverage. The City hereby covenants that it will establish, maintain, enforce and collect rates, fees and charges for services furnished by or the use of the Storm Water System as required in provision set forth in EXHIBIT F of the Loan Agreement under the caption titled “Rate Covenant”. In the event that the Gross Revenue at any time is not sufficient to make the payments required by said provision, the City covenants to promptly increase such rates, fees and charges to an extent which will ensure compliance with said covenant. (c) Enterprise Status. The City Council hereby determines that the Storm Water Enterprise is an “enterprise” within the meaning of Article X, Section 20 of the Colorado Constitution. The City has and will continue to maintain the Storm Water System as part of its “enterprise” within the meaning Article X, Section 20 of the Colorado Constitution and the Enabling Law; provided, however, after the current calendar year the City may disqualify the “enterprise” in any year in which said disqualification does not materially, adversely affect the enforceability of the covenants made in the Financing Documents. In the event that the “enterprise” is disqualified and the enforceability of the covenants made by the City in the Financing Documents are materially, adversely affected, the City covenants to (i) immediately take all actions necessary to requalify the Storm Water Enterprise within the meaning of Article X, Section 20 of the Colorado Constitution and (ii) permit the enforcement of the covenants made in the Financing Documents. DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 7 4885-8893-9034.2 (d) Obligations Currently Secured by Net Revenue. Other than the Series 2021 Bonds, the City has no other outstanding debt, bonds, notes, loans or other multiple fiscal year obligation which is secured by Net Revenue. (e) Findings of the City Council. The City Council having been fully informed of and having considered all the pertinent facts and circumstances, hereby finds, determines, declares and covenants with the CWRPDA that: (i) the Storm Water Enterprise has been duly established and is operating during the current calendar year as an “enterprise” within the meaning of Article X, Section 20 of the Colorado Constitution and as a “water activity enterprise” within the meaning of Title 37, Article 45.1, C.R.S.; (ii) the City Council elects to apply all of the provisions of Title 11, Article 57, Part 2, C.R.S. to the execution of the Loan Agreement and to the issuance of the Bond; (iii) the execution of the Loan Agreement and the issuance and delivery of the Bond, and all procedures undertaken incident thereto, are in full compliance and conformity with all applicable requirements, provisions and limitations prescribed by the Constitution and the Enabling Law, and all conditions and limitations of the Enabling Law and other applicable law relating to the execution of the Loan Agreement and the issuance and delivery of the Bond have been satisfied; and (iv) it is in the best interests of the City and its residents that the Bond be authorized, issued and delivered at the time, in the manner and for the purposes provided in this Ordinance. Section 6. Amendment of Ordinance. This Ordinance may be amended only with the prior written consent of the CWRPDA. Section 7. Limitation of Actions. Pursuant to Section 11-57-212, C.R.S., no action or proceeding concerning the issuance of the Bond shall be maintained against the City unless commenced within thirty days after the date of passage of this Ordinance. Section 8. Ratification of Prior Actions. All actions heretofore taken (not inconsistent with the provisions of this Ordinance) by the City Council or by the officers and employees of the City directed toward the issuance of the Bond for the purposes herein set forth are hereby ratified, approved and confirmed. Section 9. Headings. The headings to the various sections and paragraphs to this Ordinance have been inserted solely for the convenience of the reader, are not a part of this Ordinance, and shall not be used in any manner to interpret this Ordinance. Section 10. Ordinance Irrepealable. After the Bond has been issued, this Ordinance shall constitute a contract between the CWRPDA and the City, and shall be and remain irrepealable until the Bond and the interest accruing thereon shall have been fully paid, satisfied, and discharged, as herein provided. DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 8 4885-8893-9034.2 Section 11. General Provisions Applicable to this Ordinance. The following general provisions and findings are applicable to the interpretation and application of this Ordinance: (a) Severability. If any clause, sentence, paragraph, or part of this Ordinance or the application thereof to any person or circumstances shall for any reason be adjudged by a court of competent jurisdiction invalid, such judgment shall not affect, impair or invalidate the remainder of this Ordinance or its application to other persons or circumstances. (b) Inconsistent Ordinances. All other Ordinances or portions thereof inconsistent or conflicting with this Ordinance or any portion hereof are hereby repealed to the extent of such inconsistency or conflict. (c) Safety Clauses. The City Council hereby finds, determines, and declares that this Ordinance is promulgated under the general police power of the City of Englewood, that it is promulgated for the health, safety, and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The City Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. (d) Publication. Publication of this Ordinance may be in the City’s official newspaper, the City’s official website, or both. Publication shall be effective upon the first publication by either authorized method. (e) Actions Authorized to Effectuate this Ordinance. The Mayor is hereby authorized and directed to execute all documents necessary to effectuate the approval authorized by this Ordinance, and the City Clerk is hereby authorized and directed to attest to such execution by the Mayor where necessary. In the absence of the Mayor, the Mayor Pro Tem is hereby authorized to execute the above-referenced documents. The execution of any documents by said officials shall be conclusive evidence of the approval by the City of such documents in accordance with the terms thereof and this Ordinance. City staff is further authorized to take additional actions as may be necessary to implement the provisions of this Ordinance. Additionally, authorized officers and representatives as identified in Exhibit B to the Loan Agreement shall be Tim Hoos, Deputy Director – Engineering and Asset Management, Brittany Payton, Business Support Specialist, Kevin Engels, Finance Manager and Christine Hart, Accounting Supervisor. Section 12. Effective Date. This Ordinance shall take effect thirty days after publication following final passage. Introduced, read in full, and passed on first reading on the 16th day of May, 2022. Published by Title as a Bill for an Ordinance in the City’s official newspaper on the 19th day of May, 2022. Published as a Bill for an Ordinance on the City’s official website beginning on the 18th day of May, 2022 for thirty (30) days. Read by Title and passed on final reading on the 6th day of June, 2022. DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33 9 4885-8893-9034.2 Published by Title in the City’s official newspaper as Ordinance No. 28, Series of 2022, on the 9th day of June, 2022. Published by title on the City’s official website beginning on the 8th day of June, 2022 for thirty (30) days. This Ordinance shall take effect thirty (30) days after publication following final passage. Othoniel Sierra, Mayor ATTEST: Stephanie Carlile, City Clerk I, Stephanie Carlile, City Clerk of the City of Englewood, Colorado, hereby certify that the above and foregoing is a true copy of the Ordinance passed on final reading and published by Title as Ordinance No. 28, Series of 2022. Stephanie Carlile DocuSign Envelope ID: 2CA177CA-9C27-4E9F-AF87-35D7D40DCA33