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HomeMy WebLinkAboutORD 2025-065 2024-2026COUNTY OF HAWAI`I STATE OF HAWAI`I BILL NO. 74 ORDINANCE NO. 25 65 AN 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 Hawaii (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, Hawaii (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. 0) 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. Pavment 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 Hawaii 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 Hawaii 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: C- -113 /,tZ_ COUNCIL M BE , COUNTY OF HAWAI`I Kona , Hawai`i Date of Introduction: August 6, 2025 Date of 1 st Reading: August 6, 2025 Date of 2nd Reading: August 20, 2025 Effective Date: September 5, 2025 REFERENCE Comm. 411 EXHIBIT A [FORM OF BOND] UNITED STATES OF AMERICA COUNTY OF HAWAI`I STATE OF HAWAI`I PUBLIC IMPROVEMENT BOND, [SERIES DESIGNATION] Dated: , 2025 Interest Rate: % Final Maturity: , 20 The COUNTY OF HAWAII, State of Hawaii (hereinafter called the "County"), for value received, hereby promises to pay to the United States of America, acting through the United States Department of Agriculture Rural Development on behalf of the Rural Utilities Service ("USDA"), or registered assigns, as Registered Holder (a) annually on of each year, commencing on 2026, interest on each Loan Advance (as hereinafter defined) from the date such Loan Advance is funded and received by the County until the payment of all Principal Installment Amounts shall be made or provided for in full, at the rate specified above; and (b) on in each of the years set forth in the following Maturity Schedule, the principal installment amount (each, a "Principal Installment Amount") set forth in such Maturity Schedule opposite such year, provided that if the total amount of Loan Advances actually made is less than $275,000.00, the Principal Installment due on each date shown on the Maturity Schedule shall be in an amount obtained by multiplying (i) the amount shown for such date on the Maturity Schedule, by (ii) the Aggregate Funding Percentage (as hereinafter defined). MATURITY SCHEDULE Maturity Maturity Maturity Date Date Date Amount Amount Amount All Principal Installment Amounts and interest thereon, except the last Principal Installment Amount and interest thereon, shall be paid by check or draft mailed or by wire sent to the Registered Holder at the Registered Holder's address or account as it appears on the Bond Register kept pursuant to the proceedings authorizing this bond or otherwise as agreed upon by the County and .the Registered Holder. The last Principal Installment Amount and interest thereon shall be payable upon presentation and surrender of this bond at the office of the Director of Finance of the County, as Registrar and Paying Agent, in Hilo, Hawaii, or at the office of any successor Registrar and Paying Agent appointed from time to time by the County. All amounts A-1 due hereunder 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. As used in this Bond: (a) "Aggregate Funding Percentage" shall mean the percentage that is obtained by dividing (i) the total amount of all Loan Advances actually funded by USDA and received by the County, by (ii) the amount of $275,000.00 representing the maximum amount of the Loan Advances USDA has agreed to make to the County hereunder; (b) "Loan" shall mean the loan, in an amount not to exceed $275,000.00, that USDA has agreed to make to the County hereunder to pay a portion of the costs of a public water system project to serve Iki Place, Kohanaiki Homesteads; -and (c) "Loan Advance" shall mean each portion of the Loan funded by USDA and received by the County, as set forth in the Record of Advances contained herein. This Bond is authorized by the County to be issued to evidence the County's payment obligations with respect to the Loan from USDA to finance the aforesaid public water system project. This Bond is issued under and pursuant to and in full compliance with the Constitution and laws of the State of Hawaii, including Part I of Chapter 47, Hawaii Revised Statutes, as amended, the Charter of the County, proceedings of the aforesaid Council duly taken thereunder and a Certificate of the Director of Finance of the County providing for the issuance and sale and fixing the form and details of this Bond (the "Authorizing Certificate"). Reference is hereby made to the Authorizing Certificate for additional provisions applicable to this Bond, to all of which provisions the registered owner hereof by acceptance of this Bond hereby assents. This Bond is subject to redemption in whole or in part at the option of the County, prior to maturity, at any time at the principal amount thereof and the interest accrued thereon to the date fixed for redemption. In the event this Bond is redeemable, as aforesaid, and shall be called for redemption, notice of the redemption hereof stating the designation, date, number and maturity of this Bond, the portion of the principal sum hereof to be redeemed, the date fixed for such redemption and the premium payable upon such redemption, shall be mailed, at least once not less than thirty (30) days prior to the date fixed for the redemption hereof, to the holder hereof in whose name this Bond is registered upon the. Bond Register as of the close of business on the forty-fifth (45th) day (whether or not a business day) next preceding the date fixed for the redemption hereof. The failure of the Registered Holder hereof to receive such notice by mail or any defect in such notice shall not affect the sufficiency of the proceedings for the redemption of this Bond. If less than all of the principal sum hereof is to be redeemed, in such case upon the surrender of this Bond to the Registrar there shall be issued to the Registered Holder hereof, without charge therefor, a new Bond for the then unredeemed balance of the principal sum hereof. If this Bond (or any portion of the principal sum hereof) be redeemable and shall have been duly called for redemption_ and notice of such redemption duly given as aforesaid, and if on or before the date fixed for such redemption payment of the principal sum hereof to be redeemed, the premium payable upon such redemption and the interest accrued on the principal sum to be redeemed to the date fixed for such redemption shall have been duly made or provided for, then this Bond (or the portion of the principal sum hereof to be redeemed) shall become due and payable upon such date fixed for redemption and interest shall cease to accrue and become payable from and after the date fixed for such redemption on the principal sum hereof to be redeemed. A-2 This Bond is transferable only upon the Bond Register at the office of the Director of Finance of the County, as Registrar and Paying Agent, in Hilo, Hawaii or at the office of its successors from time to time appointed by the County, by the Registered Holder hereof, or by the Registered Holder's duly authorized attorney, upon surrender of this Bond (together with a written instrument of transfer satisfactory in form to the Registrar and Paying Agent duly executed by the Registered Holder or the Registered Holder's duly authorized attorney, which may be the form endorsed hereon) and subject to the limitations and upon payment of the charges, if any, provided from time to time by the County and the Registrar and Paying Agent, and thereupon a new Bond in the same principal amount as the Bond surrendered, shall be delivered to the transferee in exchange thereof. The County and the Registrar and the Paying Agent may deem and treat the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of the principal hereof, premium, if any, and interest due hereon and for all other purposes, and they shall not be affected by any notice to the contrary. This Bond is authorized by the Council of the County to be issued to provide funds for payment of a portion of the costs of a public water system for a Water System Improvement District established by the County pursuant to Chapter 12, Hawai`i County Code. This Bond is issued under and pursuant to and in full compliance with the Constitution and laws of the State of Hawaii, including Part I of Chapter 47, Hawai`i Revised Statutes, as amended, the Charter of the County, and proceedings of the aforesaid Council duly taken thereunder. This Bond is a general obligation of the County, and the payment of the principal and interest hereof is a first charge on the general fund of the County. The full faith and credit of the County is irrevocably pledged to the punctual payment of the principal of and interest on this Bond according to its terms. It is hereby certified and recited that all the conditions, acts, and things essential to the validity of this Bond and the issue of which it forms a part exist, have happened, and have been done; that every requirement of law affecting the issue thereof has been duly complied with; and that the amount of this Bond, together with all other indebtedness of the County, is not in excess of any constitutional or statutory limitation on indebtedness. A-3 IN WITNESS WHEREOF, the COUNTY OF HAWAI`I, State of Hawaii has caused this Bond to be signed by the manual or facsimile of its Mayor and the manual signature of its Director of Financer, and to be sealed with the facsimile of the seal of the County of Hawaii, and this Bond to be dated as of the day of , 20 [SEAL] [MANUAL OR FACSIMILE SIGNATURE] Mayor [MANUAL SIGNATURE] Director of Finance /:vil [FORM OF INSTRUMENT OF ASSIGNMENT] ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (please insert social security or other tax identifying number of assignee): (name and address of assignee) the within -mentioned Bond and hereby irrevocably constitutes and appoints attorney -in -fact, to transfer the same on the Bond Register in the office of the within -mentioned Registrar and Paying Agent with full power of substitution in the premises. Date: Signature Guaranteed: (name of assignor) (address of assignor) NOTE: The signature to this assignment must correspond with the name as written on the face of the within Bond in every particular, without alteration or enlargement or any change whatsoever. A-5 OFFICE OF THE COUNTY CLERK County of Hawaii Kona, Hawaii Introduced By: matt Kaneali'i-Kleinfelder (B/R) Date Introduced: August 6, 2025 First Reading: August 6, 2025 Published: August 15, 2025 REMARKS. - Second Reading: August 20, 2025 To Mayor: September 3, 2025 Returned: September 8, 2025 Effective: September 5, 2025 Published: September 19, 2025 REMARKS: C;;11N I Y CL,J%K ROLL CALL VOTE AYES NOES ABS EX Galimba X Hustace X Inaba X Kagiwada X Kaneali`i-Kleinfelder X Kierkiewicz X Kimball X Onishi X Villegas X 8 0 1 0 ROLL CALL VOTE AYES NOES ABS EX Galimba X Hustace X Inaba X Kagiwada X Kaneali`i-Kleinfelder X Kierkiewicz X Kimball X Onishi X Villegas X 9 0 0 0 I DO HEREBY CERTIFY that the foregoing BILL was adopted by the County Council published as indicated above. Approve Disapproved this J�~ day of S�-Y-�W1b2V 20 MAYOR, COUNTYOFHAWAI`I COUNCIL CHAIRPERSON COUNTY CLERK 74 Reference: C-411/Waived FC Ord No.: 25 G