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HomeMy WebLinkAboutCrowe ChizekFrom-Crowe Chizak T=033 p.oog/O03 F,!38 Crowe November 10~ 2003 Ms. Pegsy Wilder Clerk Treasurer City of le 501 Eask In re: Cit) WorkS' ~low of F'~ttcl~ and Fund Balances Dear Peggy: Following Wo:~s (Utility) City Bonds) Sec ' ~e flow of f~d~ for tl~e City of jeffezsonville !v~unic~pal Sewage : out ~ Or--ce No. 9~R-4I (1995 ~,[~ce) w~ a~o~ed ~e Ke~di~ Bon~, Se:ies 1995 (1995 , ~a Sewase WO~ K~ue · qo. 98-OK-27, ~ am~ded (1998 Ozd~ce) w~ au%ho~ed ~e Cz~ ge Woz~ g~ue Bonds, S~¢~ 1998 (1~8 BondS), ~d ~ ~ Works R~ue Bonds, Se~e:~ 1999 (1999 BondS). 14 of ~e 1995 ~ce ~d S~om 13 ol ~e 1998 Ore,ce ~tab~ ~e the Reserve calendar monk, ' Revenue Fund Operation and Maintenance Fund Find, which is cOmprised of ~I~ Bond and IntereSt Account and Fund Operation and Maintenance Fund , the Ui~ty is to be placed ~n the Revenue Fund. On fire last day of eack to tke Operation and s a:e to be transferred from the Revenue Ftmd. ' d for the paymen~ of ~e reasormble and p~oper OlVera[i°~, repa~ . ~d Ma~ca F~ ~ sk~ld be ma~{a~ed a~ a ~s o~ ~era~on~ ~epa~ ~d ~ce for ~e bal~ce s~c{en~ ~ ~ay ~e expe · ' ..... ,~- ~ast ~al ~es~, we es~te bal~e shoed be: ~ppro~a~ely ~00,000 ~or [ke ~erafi~ ~d Marten~ce Sinking l:und The 1998 Bonds, and Sinking Pund is used to make debt sarvi~ e paym. eaxts on the 1995 Bc~ds, ~ Bonds. ~acl~ r~omt-,% 1 / 6m of the s~'ose~Iuent tnteres~ p~ymem~ ~nd 1 / ].2m Nov- 0-03 l~2:O~,pm From-Crowe Chizek November 10, 2003 p~ 2 of :2 T-035 p 003/003 F.738 o~ t fo?he 1995 Bond~, the t9')8 Ben&% artd ~e 1999 Bon~ ~ tq ~e Bond ~d ~e R~e Accost of ~e S~g l:~ is to be held as a ~ of ~e b~c . ' ~e am~t of p~dp;~l md ~terest on ~e 1995 ~nds, d~a~t m _P -- . ...... ~ ~ a,llv ~d~ ~d no money s~e~ ~n~. ~e K~e~e ~c~v~ ~e ~998 Bomds, ~d Improvement Fund Any Improvement Fund the Utility. Moneys AccOUnt to l~revent Money~ can ~o ~ Txan~fer/rom the ] The OF~atic~a and trander all the ~on Once the Operatior ~em~ane making Ifyouhave any qu Respectfully subn~ ]e~ui[er Z. Wilson a~ter the paylnent of operation and m~t~ce e~e~es, ~ ~d~g M~ce ~d b~ce, ~ ~e ~i~ ~ ~e Bond ~d ~te~st ~h~d be ~med to ~e ~p~t ~d. ~e ..... ~ aa~o~ md ~ten~o~ be ~ed fo~ ~pr~, xeplac~,,~, . F~d cmbe ~sfe=cd to ~e Bond ~d deia~t ~ ~ pa~ent o[ p~P~ md h~texest on ~e ~ bon~- ~ ~e Kes~e Acc~t to ~e up my defd~ or ~y be : the Utility, o ~he Operation and Maintenance Fund . $1,345,740.06 and ~ Ftmd currently has a negaixvc balance of that the Utility b.~l~rtce of $1,556,761.17. ~/e Tecommemd ~ ,-..-~ ~ +he C~eration a~d Maintenance l=und- ,,,a i~ the Im~ovemen~ c~'~ ..... r. . ~ ~ ram the Utility ca~n axial Maintenance l-trna ~,~, r mi~rs to the Improvement Fcmd. sti~ns concerrdllg the above~ please give me a call at ($17) 269-6696. ted, of the proceeds derived from the sale of the bonds authorized hereby shall be and are hereby set as/de for application on the cost of the Refunding. ~/~~,~2~. Th~ proceeds of the such bonds to be applied to the Sec. 9. payment of principal of and interest and premium on the Refunded Bonds shall be deposited in escrow pursuant to the Escrow Agreement. The balance of the proceeds of the bonds shall be used to pay costs of issuance of the bonds and other inddental expenses. The ,Escrow Agreement shall b.e in customary form, as approved by ~e Mayor or the · .. ' s~ ature thereon. The moneys depo.s~ted pur.sua.? to Cl-rk- urer as exndeneed by his. ~ ..... ,, ~._ ~,~a o, cash or invested m direct - ~-~ Treas----~,ment *to ~ out tlae liellnlolng sllatt v~ ~-,, ,~ the tascrow ~g~ ........ · ......... which are unconditionally · · ' rinci at aha interest ~ - . ' ' attous of, or obligations the p__~p.~a ~ irrevocabl~ set astde and pledged oblig ........ ~ ~mtes of Ame,,,~, and shall__ - guaranteea vy, ~e umr=u o the Clerk-Treas~xer are each here.by authorized to enter such ose. The Mayor .and .... --. ~-~,~, thonzed to ay the charges for purp .... ~ .~, ',erlc:~ reasure~ ~ ,~-,-~: au P into the Escrow Agreemen~ ~m,, ,~* ~-· The entry by the City into the Escrow Agreement and for the services of the Escrow Agent. City, and the taking of such other the execution of the F, scr6w Agreement on behalf of the effect the Refunding action and the execution of such other instruments as are neCessary t~rdlnance, hereby ~tt~o~ized, approved and rattuea. . enue~ The interest on and the principal of the Bonds : . 10 Pledge of Ne~ Rev _ .. · . ~^ hereafter issued on a Sec_ · .- · · ~ .~.~ ~rdmanee, and any ~,,nds issued pursuant to the prowSwnS vx ~o '~ Section 20 hereof, on all the net parity therewith, shall constitute a first charge, subject to revenues, and such net revenues are hereby irrevocably pledged to the payment of the interest on and principal of such Bonds, to the extent necessary for that purpose. Sec. 11. ~qewage Wor~s Revenue Fun~ All revenues derived from the operation of the sewage works and from the collection of sewer rates a~ chuges shall be deposited in the Revenue Fund, created by Ordinance No. 90-OR-53. and herein continued, and segregated and deposited as set forth in that ordinance. Of these revenues the proper and reasonable expenses of operation, repair and maintenance of th,e works shall be paid, the - ' ~ or ,-avlno agents fiscal.agoncychargesoxreg~sum~ e ~ ~ principal of and interest on all bonds and tranderred to shall be paid, and the costs of replacements, extensions, additions and improvements shall lqo moneys derived Dom the revenues of the sewage works shall be be paid. City or be used for any purposes not connected with the sewage works any other fund of the so long as any bonds payable from the revenues of the sewage works are outstanding. On the last day of each Sec. 12. ~ewag¢ W0rl~s Overatlon and Maintenance Fund. from the calendar month, revenues of the sewage works shall thereafte, be transferred Revenue Fund to the Operation and Maintenance Fund, created by Ordinanc. e No. 90-OR- expenses of operation, repmr ann mature months. The moneys credited to this Fund shall be used for the payment of the reasonable and proper operation, repair and maintenance expemes of the sewage works on a day-to-day · ,,,, mt~nles in said Fund may be transferred to the Sewage Works Sinking Fun.d. if bonds of the sewage works. Sec. 13. Sewage'Works Sinking Fund.' (a) There is hereby continued a s/nki~g fund, created by Ordi~c~ Bio. 90-OR-53, for the payment of the priudpal of and interest on revenue bonds which by their terms are payable from the net revenues of the sewage works and the payment of any fiscal agency charges in connection with the payment of bonds, which fund shall be designated the ~Sewage Works Sinking Fund" (herein, "Sewage Works Sinking Fund" or "Sinking Fund"). There shall be set aside and deposited in the Sinking Fund, as available, and as hereinafter provided, a ~_~fficiant amount of the net revenues of the sewage works to meet the requirements of the Bond and Interest Account and Reserve Account hereby created in the Sinking Fund. Such payments shall continue until the balance in the Bond and Interest Account and the Reserve Account, equal the principal of and interest on all of the then outstanding bonds of the sewage works to the final maturity _and provide for payment~of all fiscal agency charges. (b) Bond and Interest Account. Any moneys he.r?.tofore accumulated to pay princlp~l'of and interest on the Refunded Bonds, after provadmg for the next payment of principal and interest on the nnrefunded maturities, shall be credited to and become a part of the lEscrow 3~ccount under the Escrow Agreement and shall be applied on the first payment made from the Escrow Account. Beginning as of the date of issuance of the Bonds, there shall be credited on the Iast day of each calendar month from the Revenue and IntereSt Account an mount of the net revenues equal to (i) one-s.'.~th Fund to the Bond . . . . J. _ ~.2..n; .~g~,gi ': e thin next succeeding (1/6) of the interest on all men outstanding uu,~,,o k,,~j,~,--e ou th interest payment date and (ii) one-twelfth (1/12) of the principal of all then outstanding bonds payable on the then next succeeding principal payment date until the amount of interest and principal payable on the then next succeeding respective interest and principal payment dates shall have been so credited. There shall similarly be credited to the account any amount necessary to pay the bank fiscal agency charges for paying interest on outstanding bonds as the same become payable. The City sh~ll~ from the sums deposited in the Sinking Fund and .credit. ed to the Bond and Intere~t.~ognt,.remit o.ne business day prior to any interest and/or prindpal payment date immediately avadable funds to the bank fiscal agency charges in amounts sufficient to pay the interest and principal on the due dates thereof together with the amount of bank fiscal agency charges. e? deli e, of the onds, deposit (C) ~ ~ and funds from the reserve provided available and unrestricted Iunas et me sewag~ for in the Sinking Fund of the Refunded Bonds, into the Reserve Account in.an mount equal to the least of (i) maximum annual debt service on the Unrefunded Bonds and the Bonds (the ,Outstanding'Bonds") (ii) 125% of average annual debt' service on the Outstanding Bonds or (iii) 10% of the proceeds of the Outstanding Bonds ("Reserve Requiremenff). The balance in the Reserve Account shall never exceed the Reserve -15- Requirement. The Reserve Account shall constitute the mar/jrt for safety and protection · t default m the payment of principal of and inte. res, t on the .Bonds, and thc moneys ag ~a~ ~ __~..., ~on t~e used to oay current pnnapal and interest on the Bonds to in.the Reserve ~ccou~t o,~,~" ~' the ext~nt the moneys in the Bond and Interest Account are insufficient for that purpose. ...... -'-,~-, ance maintained in thc .g~.rv~.A;ccg..~ Any oe~aency m ~,- bal. . _~. .... dits into me ~ono v. uu the'next available net revenues remamm~ m~- ,~,-,~ Requirement may, in the · . .... ~-,-. ~ ~-ans/erred to the Improvement Any moneys in the Reserve Account in excess of the ReserVe. 4. .'-- -* the Board of Public Wor~s .a~..a om~y., ~'-.'~ .~7,~_,. of..rind~al of Bonds atsereuo.a m .......... ,.:~ of °uts*~ndinu bonds or msmum~a~, Fund or be usea zor me Pm~'~ at a price not exceeding par and accrued interest. Sea 14. ~ewa~e Works Improvement Fund. Any excess revenues may be tranderred or credited from th~ Revenue Fund to a fund, created by Ordinance No. 90-OR-53 and hereby continued, designated the "Sewage Works Improvement Fund, ~ and said Fund shall · . nts, additions and extensions of the sew. age works...As ~,~ ~1 fo mavrovements, replaceme . _ --~-~ · ,~*he date of the oeltve~J o~ m~ uu.~.~,, ~ . .- a.~ *~rms of this oramance sewage works not othervns* ,~o.~. ~--- - - -'- ~--ital imcrovements or ment Fund and used tot.sewage wotr~ ~,v ~ ~ shall be tr~nffcrred to the Improve , .--- ~ ~ *~,~ So.~e Works Improvement ~una . for any other lawful purpose, xvma~ ~ ...... ~ prevent a default in the transferred to thc Sewage Works Sinking Fund ff necessary to ~avment of prmapal of .... ,-: .... ~alance in tl~c ~eserve Accoun ~. ., x , . · ' or ~"'"' uo~*.--.. ' eliminate any deficiencies in credits.to ,. ~__~ .~ +~.~ t-~eration and Mmntenance ~un - Fund or may t~ . · · ce of the sewage Sewage Works Sinking ....... emtto" renatr and mamtenan tO llleet unforeseen cortllngenctes m tae up*~a~ ~, r works. --~ - o'----~taneonslv with the issuance of the ..bonds, co~ aq. Rever,ion of Flow or l~unug..~m~-_. ~_ :~;~l~i[~& vm-suant to Ordinance - --- and investments m thc funds an?..ae~o_~ '; . . ... ~,~__~ shall be used, after the raon~y~ ~m ~ .. ..._ ,,n r~l~.~o ttlle "F_,xistlllg blo. 90-OF.-~o auu - forth in the Escrow Agreement, and providing for the Reserve Requirement, as set transferred and deposited into the Funds and Accounts established by this ordinance as txansfcrred moneys and provided in Sections 11, 12, 13 and 14 hereof- Thereafter, all such investments, together with revenues of the sewage works, shall be applied by the City in accordance with the terms of this ordinance so long as the cash and Government · ' w A eement are available and sufficient to pay r~.u~*lan~ on deposit under the Escro . gr~e ~ ~-n ~.as In the event that the cash '".~'o~'F,'~-- -~'n~ival of and interest on the ~etuna~ ~,,,,,~ interest earned and Government Obligations, together with any increment thereto and ereo will not be s~ffi~e,nt P Y.. 'ties the City covenants .ann th ~, . . ct~ve final matun , · of the onds to and including me~r respe - - ' d in accordance vath the terms . ~i~the revenues of the sewage works shall be applie claim of the owners of the Bonds ordinance authorizing the Refunded Bonds, and (ii) the is in all respects junior and subordinate to the rights of the holders of the Refunded Bonds under said ordinance. -16- Section 1:3. l~tmds,,,and. Accounts (a) ~hp~.ge Works g~ue Fund. ~ ~ d~v~ ~om ~e ~ of,~' ~e wor~ md ~om ~e ~ion of~w~ mt~ ~d c~ ~ be d~t~ ~d ~n~ h~n. ~e r~u~ ~ ~e R~ue F~d, the proper ~d r~mble ~p~ ~n& ~d fi~ ~ ~g~ of~m or pa~ agents ~ ~ p~ ~d &o roms of rep~mm, em~ions,.~fio~ ~d ~provem~ts sh~l be p~d. No mone~ de~ed bom.~e ~ of&e ~ge w~ ~ ~ m~ m ~y o~er ~d of~e C~ or be pu~ ~t ~M ~th ~ ~e wo~ so long ~ ~ bonds ~y~le bom ~ r~u~ of~e s~ge w0~ ~ ou~ding. ~) Sewage Works Operation ~d Maintenance Fund. ~ ~ t~t day of mon~ r~enues ofthe s~ge works shall be tr~ed bom the R~mue FuM m ~e Ope~on ~d ~ce F~ mnt~ued ~ 1995 Ordh~co ~d ~r(m (~e "O~on ~d M~mce FindS). ~e b~an~ main~ed in t~s Op~fion and M~t~ce Fred ~d~t to pay ~e ~s ofopemio~ rep~ ~d ~te~e for the ~en ne~ ~ (2) ~d~ m~. ~ mn~ ~t~ to ~s Operation ~d ~te~ce Fred ~ for tho pa~ of~e r~mble ~d pmp~ ope~tio~ gpak ~d ~i~ce ~ens~ of &e ~ge wor~ on a d~-to~y b~, but none of ~e moneys ~ ~e Opinion ~d M~t~ce F~d s~ ~ us~ for depreciatiog ~tacmentg improvem~s, ~ensions or ~difions. ~y m~es ~ ~e Op~ation and M~tenm~e F~d my be ~f~ to Works Sinking Fund ifn~sa~ to preverit a default in the payment of principal of or interest on the ouistandlng bonds of the sew~e works. , (o) ~fl]~lL.E~- There is hereby confinuedasinldngfund, cuntinuedby'the 1995 Ordinance and herein, for the payment of the principal of and interest on revenue bonds which by their terms are payable from the net r~veanes of the sewage works and the payment of any a~en~y charges in connection with the paylnent of bonds, which fund shall be designated the "Sewage Works Sinking Fond" (hereto, "Sewage Works S~nking Fund or Sinking There shall be set aside and deposited in the Sewage Works Sinking Fund, as available, and as hereinafter provided, a su~cient amount of the Net Revenues of the sewage works to meet the requireme~ts of the Bond and Interest Account (hereafter defined) and Debt Service Reserve Account (hereinafter defined) in the Sinking Fund. Such pa~ents shall continue until the balances in the Bond and Interest Account and the Debt Service Reserve Account equal the principal of and interest on a~ of the then outstat~dlng bonds of the sewage works to the'~r malty. ('ii) Bond and Interest Account.. There shall be credited on the last day of each calendar month from the Revenue Fund to the Bond and Interest Account of the Sinking Fund here'm established (the 'Bond and Interest Account") an amount of the Net Revenues extual to ~ne-slxth (1/6) of the interest of all then outstanding bonds payable on the then next succeeding interest payment date and (ii) at least one-twel~ (1t12) of the principal on all then outstanding bonds payable on the then next succeeding respective interest and principal payment dates unt~ the amoun~ of the intere~ and principal payable on ~he next succeeding interest and principal .payment da~ shall have been so credited. There ~ similarly be credit~l w the ac~un~ any -27- · n 6utstanding b ads bank fiscal agency chargei'for paying interest o o payth araou~ ~cessary to e . -.' -" '%m the stuns deposited in the Sinl~g FTd and as the same become payable. The City snau, a ' credited to the Bond and Interest Account, remit promptly to the registered owner or tb the bank fiscal agen~ sufficient moneys to pay the interest and principal on the due dates thereof together with the amount ofba~k l~al agan~T charges. Cm-') ~ebt Service Ri~erve Aero,mt. Funds representing the ~ of safety ~or the Bonds established and maintained pur~ar~ to tl~s Ordinance shall be deposited into the Debt Servlc~ Reserve Account of the Sinking Fund {the "Debt Service P. ese~e Account'). The initial deposit or the balan~ accumulated in the Debt Service R~serve A~count shall not exc~l the least of (i) the maximum armunI debt service on the Bonds, ('ii) 125% o£ average annual debt ...... · '~ -~*~e stated .rinclpal amount of the bonds CReserv~ service o11 the Bones or Un) into uz ~,, r tt. equirement'). The balancu in the Debt Service Reserve Account, allocable to the bonds, shall never exceed the Reserve Requirement. 16the initial baia~ce in the Debt Service Reserve is less than the Reserve ICequirament, an amount ofl%t R~venues sI~l! he ~redited to the Debt S~-rvic¢ l~serve Account on the last day of each calendar month until the balance ther~ equals the Reserve Requirement. The monthly deposits shall be equnl in amount and sm~cient to accmrmlate the Reserve Requirement within five (5) years of the date of delivery of the Bonds. ~he Debt Service Reserve Account 'shall constitute the margin for safety and proteaiou against default in the payment of principal of and interest on the bonds, and the moneys in the Debt Service Reserve Account shall be used to pay current principal and interest on the bonds to the extent that moneys in the Bond and Interest A~tnt are ins~ffi~ for that purpose. Any deficie~:Y in ~ balance maintained in the Debt Serv~c~ Reserve Ac~otmt ~ b~ made up the next available Ne~ P. even~es ren~i.lr~ after ~r~tlfs into the Bond and Interest Account. Any ' ' quirement shall eitber be moneys in th~ D~'cbt Serwce Reserw Account in excess of'the Reserve Re : trar~erred to the Sewa~e~ Works Improvement Fund or be used for tho purchase of outer, anding bonds or in~--~ltmeitts of principal of fully re~stered bonds. (d) ~_el~age Work4 Imnrov~raent Fund.: Any excess revenues over anti above the requirements of the Operation and Maintenance Fund and Sinking Fund may be transferred or credited from the Revenue Fund to the Sewage Works Improvement Fund continued by the 1995 d Ordinance and herein (the ~Improvernent Fund ), an the Improvement Fund shall be used for improvemertts, raplacemcn'ts, additions and extension ofthe sewage works. Moneys in the' - ~ -' to the Sinking Fund if necessarY to prevent Sewage Works Improvement Fund shall t~ transterrea a default in the payment of principal and interest on the then outstanding bonds or, if necessa~, to ' ~ to or minimum balance in the Debt Service Reserv~ Account e 'hnfinae any deticiencies in credits ~ Sinking Fund or may be ffansferred to the Operation and Maintenance Fund of'the Sewage Works to meet unforeseen contingencies in the operation, repair and malnte~ance of the sewage work~ Section 14. [nve-;,uent Of Fvnd! The Sinking Fund shall be deposited in and maint~..Jned as a separate account or accounts f~om all other accounts of the City. The Revenue Fund and the. Improvement Fund may be maintained in a single account, or accounts, but such account, or ~counts, shall likewise be maintained separate and apart from all other accounts of tho City and apart from the Sinking Fund account or accounts. All moneys deposited in the accounts shall be deposited, beld and secured as public funds in accordance with the publicdepository laws o£the li afions in acco~dsnce with State of Indiana; provided that moneys therein may be invested in ob f~ the applicable laws, including pgticutarly lC $-13, as amended or supplemented, and in the eve~ of such investmmt the intom~ there~om shall become'a pait of the funds invested aid shall be used only as provided in this ordinance. , Section i5. l~~l~l~~i. If; when theBonds or a portion thereof shall have become due and payabl~ in accordance ~ith their terms or shall have been duly called for redemption or irrevocable instructions to call the Bonds or a portion thereof for redemption shall have been given, and thc whole amount of'the principal and the interest and the premium, if any, so due and payable upon all ofthe Bonds or a portion thereof then outstanding shall be paid; or (~ sufficient moneys, or (ii) direct obligations o/~ or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America, the principal of and the interest on which when due will provide sufficient moneys for such purpose, shall be l/eld in trust for such purpose, and provision shall also be made for paying all fees and expenses for the redemption, tben and in that case the Bonds or any designated portion thercofissued hereunder shall no longer be deemed ;~tstanding or entitled to the pledge'of the lqet Revenues of the City's sewage works. Section 16. ~. The City covenants and agrees that, by o. rdinance of the Common Council, it vaTll establish just and equitable rates or charges for the use of and thc service rendered by the works, to be paid by the owner of each and every lot, parcel of real estate or building that is connected with and uses said seWage works by or through any part of the sewage. system of the City, or that in any way rises or is served by such works; that such rates or charges shall be sufficient in each year to provide for proper Operation and Maintenance (as defined in the Financial Assistance Agreement) of the works, to comply with and satisfy all covenants contained in this Ordinance and the Financiai Assistance At/reement and to pay all obh'gations of the sewage works and ofthe City with respect to the sewage works. The City covenants and agrees that it