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HomeMy WebLinkAbout79-80 - Sale of Bonds, Proposed Assessment District 79-01, S. Coast DriveRESOLUTION NO. 79-80 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COSTA MESA, CALIFORNIA, AUTHORIZING THE SALE OF SPECIAL ASSESSMENT BONDS TO FINANCE IMPROVEMENTS IN PROPOSED ASSESSMENT DISTRICT NO. 79-01 (SOUTH COAST DRIVE). WHEREAS, in accordance with the terms and provisions of the "Municipal Improvement Act of 1913," being Division 12 of the Streets and Highways Code of the State of California, this City Council has initiated proceedings for the construction of certain public works of improvement, together with appurtenances and acquisition, where neces- sary, in a special assessment district; said special assessment district known and designated as ASSESSMENT DISTRICT NO. 79-01 (SOUTH COAST DRIVE) (hereinafter referred to as the "Assessment District"); and WHEREAS, this City Council has further determined that serial bonds shall be issued to finance the costs and expenses of said improve- ments and proceedings, and said bonds shall be issued pursuant to the terms and provisions of the "Improvement Act of 1911," being Division 7 of the Streets and Highways Code of the State of California; and WHEREAS, at this time, this City Council is desirous of authorizing the sale of bonds to finance the works of improvement as proposed for this Assessment District. NOW, THEREFORE, IT IS HEREBY RESOLVED BY THE CITY COUNCIL OF THE CITY OF COSTA MESA CALIFORNIA, AS FOLLOWS: SECTION 1. That the above recitals are all true and correct. SECTION 2. That F. MACKENZIE BROWN is hereby authorized to solicit proposals for the sale of bonds for the Assessment District, and said bonds shall not exceed the maximum legal interest rate of Eight Percent (8q) per annum, and said bonds shall be issued upon the terms and pro- visions of the "Improvement Act of 1911," being Division 7 of the Streets and Highways Code of the State of California, and pursuant to the terms and conditions as set forth in the Resolution of Intention as previously adopted for these proceedings. SECTION 3. That this Resolution is adopted pursuant to the provi- sions of Section 10602 of the Streets and Highways Code of the State of California, and it is further directed that all recommendations relating to the sale of bonds be presented to this City Council no later than the time set for the Public Hearing on the "Report" and related matters for this Assessment District. SECTION 4. The City will provide, at no expense to the bidder, the unqualified opinion of F. MACKENZIE BROWN, Attorney at Law, attesting to the vailidity of the proceedings and the enforceability of the bonds. SECTION 5. That pursant to Section 10600.5, said bonds shall be dated the 15th day of September, 1979, or the 31st day after the recordation of the assessment in the Office of the Street Superintendent, whichever date is later. SECTION 6. That the BID SPECIFICATIONS relating to the sale of the assessment bonds for the Assessment District are hereby approved and a copy for further particulars is referenced and attached hereto. APPROVED and ADOPTED this 28th day of June, 1979. Ma or of t o City of Costa e a ATTEST: Ci y Clerk of the City of Cr a Mesa STATE OF CALIFORNIA } COUNTY OF ORANGE } SS CITY OF COSTA MESA } I, EILEEN P. PHINNEY, City Clerk and ex -officio Clerk of the City Council of the City of Costa Mesa, hereby certify that the above and foregoing Resolution No. 79-80 was duly and regularly passed and adopted by the said City Council at a regular meeting thereof, held on the 28th day of June, 1979. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Seal of the City of Costa Mesa this 29th day of June, 1979. -Cit-y Clerk and ex -officio Cle of the City Council of the City of sta Mesa BOND SALE INFORMATION NOTICE OF SALE PROJECT: ASSESSMENT DISTRICT NO. 79-01 (SOUTH COAST DRIVE) AGENCY: CITY OF COSTA MESA, CALIFORNIA IMPROVEMENTS: The construction of certain street and utility improve- ments, together with appurtenances and appurtenant work. PROCEEDINGS: The "Municipal Improvement Act of 1913," being Division 12 of the Streets and Highways Code of the State of California. BONDS: The "Improvement Act of 1911," being Division 7 of the Streets and Highways Code of the State of California. AMOUNT: The estimated amount of assessments shall not exceed 3T,7777,154.49. This amount will be adjusted and is subject to the con- struction bids received and any possible modifications to be made at the assessment hearing as well as contingent upon any payments made during the 30 day cash collection period. It is estimated that the actual amount of the bond issue will be known approximately 35 days after the conclusion of the public hearing. The public hearing is scheduled for the 6th day of August, 1979. BOND TERM: The bonds shall be payable in FIFTEEN (15) annual install- ments extending over a period ending FOURTEEN (14) years from the 2nd day of January next succeeding the next September 1st following their date. Principal payments will be made in seven annual amounts. BID: Bonds will be sold for cash to the bidder whose bid, in the opinion of the City Council, best serves the interest of the owners in the land and bids will be accepted on a flat basis with no requirement of accrued interest. Each bid shall be for the entire amount of the bonds with a single rate of interest. No bid will be considered for less than NINETY-SIX (96) pecent of par. SECURITY DEPOSIT: A certified or cashiers check will be required to accompany the bid in the amount of $75,000.00. TAX EXEMPT STATUS: The successful bidder may withdraw his proposal if at any time prior to bond delivery the interest on said bonds shall be declared to be taxable under Federal Income Tax Laws either by a ruling of the Internal Revenue Service or a decision of a court of competent jurisdiction. AWARD RESCISSION: If the bonds are not available for delivery within Forty -Five (45T -days after their date, the City or the successful binder may upon written notice rescind any previous award. INTEREST RATE: Bonds shall bear interest from their date at a rate not to exceed Eight Percent (8%). The actual interest rate will be deter- mined based upon the bids received. COLLECTION OF ASSESSMENTS: The unpaid assessments will be collected at the Office of the City Treasurer. INVESTMENT SUITABILITY: These assessments bonds are secured by indi- vidual properties within the boundaries of the Assessment District, and neither the City nor any officer thereof is liable for the payment of the bonds. The bonds are not an obligation of the State of California or any political subdivision thereof, and there is no pledge of the full faith or credit of said City. The limited nature of the obligation for payment could result in delays in said payment. EXHIBIT "A" for Resolution No. 79-80 Page 1 of 2 PROPERTY TAXES: The city has no direct responsibility for the collec- tion of taxes, and thus any information relating to tax delinquencies should be obtained from the appropriate County officials. DATE OF BONDS: Said bonds shall be dated the 15th day of September, 1979, or the 31st day after the recordation of the assessment in the Office of the Street Superintendent, whichever date is later. RATING: The City has not made and does not contemplate making any appli- cation to any Rating Agency for a rating on these bonds. DELIVERY: The delivery of bonds shall be made at the Office of the City Treasurer. A staggered delivery of bonds, mutually acceptable to the City and purchaser, will be allowed if desired. ASSESSMENT DESCRIPTIONS AND AMOUNTS: For a description of the respec- tive parcels of land upon which the assessment and bonds are to be issued, and for related information, reference is made to the assessment presently on file in the Office of the City Clerk, and upon confirmation to be recorded in the Office of the Superintendent of Streets. AWARD: The Council reserves the right to reject any bid and to accept mid which, in its opinion, best serves the interests of the owners of land within the boundaries of the Assessment District. All bids shall be for the entire amount of the bonds to issue. A premium will only be considered for breaking a tie between two bids. EXHIBIT "A" for Resolution No. 79-80 Page 2 of 2 BONDS AND SECURITY FOR BONDS AUTHORITY: The proceedings for the works of improvement and the levy of the special assessment are pursuant to the terms and provisions of the "Municipal Improvement Act of 1913", being Division 12 of the Streets and Highways Code of the State of California. There has been substantial compliance with the proceedings of Division 4 of the Streets and Highways Code, the "Special Assessment Investigation, Limitation and Majority Protest Act of 1931." The bonds to issue to finance the works of improvements are issued pursuant to the terms and provisions of the "Improvement Act of 1911", being Division 7 of the Streets and Highways Code, and speci- fically pursuant to Chapter 4 of Part 5 of said Division 7. SECURITY: An individual assessment bond will be issued to represent each indivi- dual unpaid assessment within the boundaries of the assessment district and said assessment and bond constitute a direct lien and obligation against the particular parcel of benefited property described therein. Should default be made in any payment upon principal or interest thereon, the owner of said bond is entitled to initiate foreclosure proceedings in the manner and form as authorized by law. Neither the public agency issuing the bonds or any officer thereof is in any way liable for the payment of the principal or interest on the bonds and the payment of said bonds is solely payable from the redemption fund created under the proceedings. PRIORITIES: The assessment bonds will have priority over any private debt such as a judgment, deed of trust or mortgage, regardless of the time imposed. The assessment lien and obligation is on a parity with general property taxes and also will have priority over any subsequently issued special assessment fixed lien obligations but will be subordinate and inferior to any previously imposed special assessment debt levied on the particu- lar parcel of property. AMOUNT: The bonds can issue in any amount in excess of $150.00 and will issue in the exact amount of the assessment remaining unpaid on the particular parcel of property. An assessment bond will issue for each parcel of property and the bond represents the direct amount of the lien obliga- tion on said particular parcel of property. INTEREST RATE: The maximum interest rate allowable by law for this type of security is eight percent (8%) per annum. Assessment bonds may also be sold at a discount or at a premium. DELINQUENCIES: In the event that there is a default or a delinquency in the payment of any principal or interest coupon by the property owner on said bonds, the bond holder is entitled, as of January 2 or July 2, as the case may �. be, to immediately declare the entire amount of the unpaid assessment to be due and payable or to direct or have the lot or parcel advertised in the manner and form as provided by the "Improvement Act of 1911". The foreclosure proceedings can be either pursuant to a sale procedure through the Office of the agency's Treasurer or through a judicial foreclosure through the Superior Court. The bonds and the assessments are payable to the Treasurer on each October 15, and April 15, as the case may be and, on the next June 1 or December 1, if the assessment EXHIBIT "B" for Resolution No. 79-80 Page 1 of 2 ._ i j coupon remains unpaid, a penalty is immediately added in the amount of one percent (1%) of the delinquent amount. A similar penalty of one percent (1%) is then added for each succeeding month as long as the assessments remain unpaid. FORECLOSURE: The holder of the bond has a sole remedy in case of default or delin- quency, which is through a foreclosure action initiated either by the Treasurer of the local agency or by a Court action through the local Superior Court. Under both foreclosure proceedings, the property owner upon the issuance of the Certificate of Sale, has a one year period of redemption. The property owner also, up to the time of the sale of said property, has the right of either reinstatement of the delinquent bond or, of course, redemption. Upon the end of the one year period of redemption, the Certificate of Sale holder has right to make application to the Treasurer for a deed to the property. The Certificate of Sale will bear interest at the rate of one percent (1%) per month on the amounts included in the Certificate of Sale up to the time that the deed is to be issued. DISCHARGE OF OBLIGATION: The property owner, at any time during the life of the bond, has the right to pay off the unpaid assessment by generally paying the unpaid principal amount, together with interest to the next coupon period (January 2 or July 2, as the case may be). The City Council also has the discretion as to whether or not to include in the Resolution of Intention the provision for a five percent (5%) redemption premium and if the Resolution of Intention did so provide, then the property owner must also pay five percent (5%) redemption on the unpaid principal at the time of the discharge of the obligation. If the payments are not made in the time as allowed by law, then penalties are applicable to said proceedings at the rate of one percent (1%) per month on the unpaid amount. These bonds do provide the Five Percent (5%) redemption premium. EXHIBIT "B" for Resolution No. 79-80 Page 2 of 2