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HomeMy WebLinkAboutBIL 074 Draft 01 2024-2026AN ORDINANCE AUTHORIZING THE ISSUANCE OF A GENERAL OBLIGATION BOND OF THE COUNTY OF HAWAI‘I IN A PRINCIPAL AMOUNT NOT TO EXCEED TWO HUNDRED SEVENTY-FIVE THOUSAND DOLLARS FOR THE PURPOSE OF FINANCING A PORTION OF THE COSTS OF CONSTRUCTING A PUBLIC WATER SYSTEM SERVING IKI PLACE, KOHANAIKI HOMESTEADS, NORTH KONA, HAWAI‘I; FIXING THE FORM, DENOMINATION, AND CERTAIN DETAILS OF SUCH BOND; PROVIDING FOR THE ISSUANCE AND SALE OF SUCH BOND AND FOR OTHER MATTERS OR ACTIONS PERTAINING THERETO. BE IT ORDAINED BY THE COUNCIL OF THE COUNTY OF HAWAI‘I: SECTION 1. Findings and Determinations. It is hereby found and determined that: A. Pursuant to Chapter 12, Hawai‘i County Code 1983 (2016 Edition, as amended) (the “Code”), and Resolution Nos. 634-16, 164-23, and 542-24, the Council of the County of Hawai‘i (the “County”) has authorized the creation, definition and establishment of a Water System Improvement District (the “Improvement District”) for the purpose of undertaking and financing the costs of a project consisting of the construction, acquisition, and installation of a public water system to serve Iki Place, Kohanaiki Homesteads, North Kona, Hawai‘i (the “Project”). B. In order to assist in the financing of the Project, the United States of America, acting by and through the Department of Agriculture Rural Development on behalf of the Rural Utilities Service (“USDA”) has offered to make a loan to the County (the “USDA Loan”) in a principal amount not to exceed Two Hundred Seventy-Five Thousand and No/100 Dollars ($275,000.00) and bearing interest at a rate not to exceed Two Percent (2.0%) per annum. USDA has also offered to make a grant to the County (the “USDA Grant”) to provide further assistance for the Project in an amount not to exceed Eight Hundred Twenty-Five Thousand and No/100 Dollars ($825,000.00). C. It is advisable and desirable for the County to obtain the USDA Loan. In order to secure the payment of the USDA Loan, it is necessary, advisable and desirable that the County authorize, issue and sell to USDA general obligation bonds of the County in a principal amount equal to the principal amount of the USDA Loan. D. Costs of the Project, net of the USDA Grant and other available funds (other than temporary advances of funds), will be assessed against the “assessment units” within the Improvement District, pursuant to Chapter 12 of the Code. Collections of such assessments will be used to reimburse the County for payments of the principal of and interest on the bond authorized hereunder and for administrative expenses of the County with respect to the Improvement District and the bond. SECTION 2. Authorization of Bond. There is hereby authorized for issuance and sale a general obligation bond of the County (including any replacement thereof, the “Bond”) in a principal amount not to exceed Two Hundred Seventy-Five Thousand and No/100 Dollars ($275,000.00), the proceeds derived from the sale of which shall be used to pay a portion of the costs of the Project and costs incurred by the County in connection with the issuance of the Bond. SECTION 3. Details of the Bond. The Bond authorized for issuance and sale in Section 2 hereof shall be issued and sold to USDA to evidence and secure the USDA Loan. Such Bond shall: (1) Be issued and sold to USDA, as lender with respect to the USDA Loan evidenced and secured thereby; (2) Be in a principal amount equal to the principal amount of such USDA Loan; (3) Bear interest and mature upon the applicable terms of such USDA Loan; (4) Be issued in fully registered form without coupons; and (5) Be numbered in such manner as the Director of Finance shall determine. The Bond shall mature annually on such day in each year in substantially equal installments of principal or in substantially equal installments of principal and interest, the first of such maturities to be no later than five (5) years from the date of the Bond and the last of such maturities to be not later than thirty-five (35) years from the date of the Bond, may be redeemable prior to the stated maturity thereof at any time at prices not exceeding One Hundred and Three Percent (103%) of the principal amount thereof, and shall bear interest at such rate or rates per annum, not to exceed Two Percent (2.0%) per annum, as may be determined by the Director of Finance and agreed to by USDA. In accordance with and subject to the provisions of this ordinance, the Director of Finance is hereby authorized to determine with respect to the Bond: (1) The series designation; (2) The date of the Bond; (3) The interest rate and payment dates of the Bond; (4) The maturity dates of the Bond and the principal amount of such Bond maturing on each maturity date; (5) The registration privileges and place or places at which the Bond may be paid or registered which may include the office of the Director of Finance; (6) Whether or not the Bond shall be subject to redemption prior to the stated maturities and, if subject to such prior redemption, the times, prices, methods and other provisions for such prior redemption; and (7) All other details of the Bond. SECTION 4. Redemption of Bond. In the event the Bond shall be subject to prior redemption and if such Bond, or portion thereof, is to be redeemed, notice of redemption shall be given in such manner as the Director of Finance shall determine. If the Bond shall have been duly called for redemption and notice of such redemption duly given in the manner determined by the Director of Finance, and if moneys for the payment of such Bond at the then applicable redemption price and the interest accrued on the principal amount thereof to the date of redemption are made or duly provided for by the County, interest on such Bond shall cease to accrue and become payable from and after the date fixed for redemption. SECTION 5. Payment of Bond. The principal of and interest and premium, if any, on the Bond shall be payable in any coin or currency of the United States of America which at the time of payment is legal tender for public and private debts. SECTION 6. Execution and Form of Fully Registered Bond. The Bond shall: (1) Be lithographed or steel engraved, typewritten, printed or otherwise reproduced as the Director of Finance shall determine; (2) Bear the manual signature of the Director of Finance; (3) Bear the manual or facsimile signature of the Mayor of the County; and (4) Be impressed with or bear a facsimile of the seal of the County. The Bond shall be in the form of the Bond and the assignment shall be substantially in the form of EXHIBIT A, attached hereto, with such appropriate insertions, variations, and omissions as are required or deemed advisable by the Director of Finance. SECTION 7. Sale of Bond. To secure the payment of the USDA Loan from USDA without any further authorization from or action by this Council, but subject to the provisions hereof and of applicable law, the Director of Finance is hereby authorized to issue and sell the Bond at a negotiated sale to USDA in accordance with the provisions of section 47-8 of the Hawai‘i Revised Statutes, at such price or prices and upon such terms and conditions as such official shall approve and determine to be in the best interest of the County. Without limiting the generality of the foregoing, with respect to the issuance and sale of the Bond to secure the payment of the USDA Loan, the Director of Finance is hereby authorized to retain bond counsel, paying agents, registrars and financial and accounting consultants, upon such terms and conditions as such official shall deem advisable and in the best interest of the County, to select the date for such sale, to enter into one or more loan agreements with USDA pursuant to which the USDA Loan shall be made and the Bond shall be issued to secure such USDA Loan, in each case in such form and containing such terms and conditions as such official shall approve and deem advisable, and to take such other actions as such official may deem advisable. Subject to the provisions of Section 3 hereof, without further action of this Council, the Bond shall bear interest at the rates per annum as specified in the loan agreement or agreements so approved. The Mayor, Director of Finance, and all officials of the County are hereby authorized to take such action and execute such orders, receipts and other documents as may be necessary in order to effectuate the sale of the Bond, and, if any loan agreement therefor be approved or any bid therefor be accepted, the preparation execution, and delivery thereof, in accordance with the provisions hereof and applicable law. SECTION 8. Security for the Bond. As the Bond is a general obligation of the County, the full faith and credit of the County is hereby irrevocably pledged to the punctual payment of the principal of and interest on the Bond according to the terms thereof, and the principal and interest payments on the Bond shall be a first charge on and shall be paid from the General Fund of the County. SECTION 9. CUSIP Identification Numbers. The Director of Finance may authorize the imprinting of a CUSIP identification number upon the Bond. Such number and the imprinting thereof shall be subject in all respects to the provisions of section 47-10 of the Hawai‘i Revised Statutes. SECTION 10. Application of Assessments. Assessments against the “assessment units” in the Improvement District made in accordance with Chapter 12 of the Code shall be applied to pay or reimburse the County for: (i) Payments of the principal of and interest on the Bond and other costs relating to the Bond, and; (ii) Administrative expenses of the County with respect to the Bond and the Improvement District. Amounts so collected which are not applied or reasonably required to be reserved for such purposes shall be applied in accordance with the provisions of Chapter 12 of the Code. SECTION 11. Repeal of Conflicts. All ordinances and resolutions, and any portions of ordinances and resolutions, heretofore enacted or adopted by the Council which are in conflict or inconsistent with any provision of this ordinance shall be and are hereby repealed to the extent of such conflict or inconsistency. SECTION 12. Severability. If any provision of this ordinance, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of this ordinance that can be given effect without the invalid provision or application, and to this end the provisions of this ordinance are severable. SECTION 13. Effective Date. This ordinance shall take effect upon its approval. INTRODUCED BY: _______________________________________ COUNCIL MEMBER, COUNTY OF HAWAI‘I _______________, Hawai‘i Date of Introduction: Date of 1st Reading: Date of 2nd Reading: Effective Date: