HomeMy WebLinkAboutCOUNCIL MINUTES 1986-12-04 22988
MINUTES OF THE ONE HUNDRED AND NINETY-NINETH SPECIAL MEETING
OF THE COUNCIL OF THE CITY OF LIVONIA
Pursuant to the provisions of Section 8, Chapter 14 of the City Charter,
the above meeting was held December 4, 1986 at the City Hall , 33000 Civic Center
Drive, Livonia, Michigan and was called to order by the President of the Council
at approximately 7:06 P.M. Roll was called with the following result: Present:
Robert R. Bishop, Fernon P. Feenstra, Robert E. McCann, Gerald Taylor, Robert D.
Bennett and Ron Ochala. Absent: Joan McCotter*.
Elected and appointed officials present: Robert F. Nash, City Clerk;
Harry Tatigian, City Attorney and Jack Dodge, Director of Finance.
*Councilwoman McCotter entered the meeting at 7.10 P.M.
On a motion by Councilman Ochala seconded by Council man Feenstra,
Lit was
#1132-86 WHEREAS, general ad valorem real and personal property
taxes are imposed and levied on property located in the City
of Livonia (the "City" ) by various units of government for
which the City is the collecting unit, pursuant to Act 206 of
the Public Acts of Michigan of 1893, A D. , as amended, MCL
211 1 et seq ( "Act 206" ) , including the County of Wayne,
Livonia Public Schools School District, Clarenceville School
District, Schoolcraft Community College District, and Wayne
County Intermediate School District (collectively, the
"Units" ) on December 1 of each year, and
229SS
imWHEREAS, the City acts as the local property tax
collecting unit for the Units, and
WHEREAS, in order to significantly improve the cash flow
of the Units and to allow the Units to exercise better fiscal
control , it is necessary and desirable fcr the City to issue
consolidated tax anticipation notes in anticipation of part
of the real and personal property taxes of the Units levied
on December 1, 1986 on real and personal property located
within the boundaries of the City (the "Notes" ) in accordance
with the provisions of Section 3b of Chapter IV of Act
No 202, Public Acts of Michigan, 1943, as amended, (the
"Act" ) , and
WHEREAS, each of the Units has consented to and has
requested the City to issue the Notes by separate resolutions
and each has authorized a separate Tax Zevy Agreement with
the City with respect to the issuance of the Notes on behalf
of the Units and the collection and dsposition of taxes
levied on December 1, 1986 (the "Agreements" ) ; and
WHEREAS, the Act authorizes the Cit-, to issue the Notes
after consenting to and being requeste:: to do so by the
Units, and
22390
im
WHEREAS, under the authority of the Act, the City
proposes to issue the Notes and to distribute proceeds
therefrom to each of the Units consenter.; to and requesting
the issue all in amounts equal to a portion of the
December 1, 1986 tax levy set forth in Exhibit A hereto, and
WHEREAS, it has been estimated that the amount necessary
for distribution to the Units will require the issuance, sale
and delivery of the Notes in the aggrec:_e principal amount
of $37, 600, 000, as hereinafter provided, and
WHEREAS, no other notes have been issued in anticipation
of the taxes in anticipation of which the Notes are being
issued;
NOW, THEREFORE, BE IT RESOLVED BY SHE CITY COUNCIL OF
THE CITY OF LIVONIA
1 AUTHORIZATION OF NOTES The Nc=es aggregating the
principal sum of Thirty-Seven Million Six Hundred Thousand
Dollars ($37, 600, 000) , shall be issued and sold pursuant to
the provisions of the Act and other applicable statutory
provisions The principal sum is ca:=ulated to produce
proceeds of the Notes equal to a percentage of the total of
the tax levies anticipated in each case by each of the Units
as set forth on Exhibit A hereto.
22991
2 . NOTE DETAILS The Notes Ball be designated
"Consolidated Tax Anticipation Notes, Series 1986-B" ; shall
be dated as of December 8, 1986, shall be numbered
consecutively in order of authenticatior , shall be payable to
bearer, shall be in the denomination of $25,000 each or any
integral multiple thereof at the opt:on of the purchaser
thereof; shall mature December 8, 19E7 and shall bear
interest at a rate of interest of 4 45,, per annum payable at
maturity Interest shall be computed on the basis of a 365
day year.
3 PAYMENT OF PRINCIPAL AND INTEREST The principal
Imo of and interest on the notes shall be parable in lawful money
of the United States, in immediately a"ailable funds, upon
presentation and surrender of the Notes to the paying agent
at maturity
4 NOTE PAYING AGENT. State Street Bank and Trust
Company, N.A , New York, New York is hereby designated as the
paying agent for the Notes (the "Paying Agent" ) . The Finance
Director may from time to time as required designate a
successor Paying Agent In addition to the other
responsibilities assigned to it pursuant to this resolution,
the Paying Agent shall take all steps necessary to pay the
principal of and interest on the Notes when due.
22992
5 E'. ECUTION, r.UTHENT:C-TIO% OF Nc.=s
The Notes shall be executed in the nar=_ of the City by the
facsimile signatures of the Mayor, ::ty Clerk and City
Treasurer and authenticated by the man_al signature of an
authorized representative of the Paying =gent and a facsimile
of the seal of the City shall be imp:_nted on the Notes
After the Notes have been executed and authenticated for
delivery to the original purchaser thereof, they shall be
delivered by the Finance Director tc the purchaser upon
receipt of the purchase price
6 OWNERSHIP OF NOTES The City and the Paying Agent
may deem and treat the bearer of eacY `.ote as the absolute
owner of such Note, whether such Note shall be overdue or
tonot, for the purpose of receiving paymer: of the principal of
and interest on such Note and for all :cher purposes All
payments made to any such bearer, or upon his order, in
accordance with the provisions of Section 3 of this
resolution shall be valid and effec=:_al to satisfy and
discharge the liability upon such Note :o the extent of the
sum or sums so paid and neither the Cit nor the Paying Agent
shall be affected by any notice to the contrary The City,
to the extent permitted by law, will indemnify and save the
Paying Agent harmless from and against any and all loss,
cost, charge, expense, judgment or liat:lity incurred by it,
acting in good faith and without negligence hereunder, in so
treating such bearer
22993
7 FORM OF NOTES The Notes shales be in substantially
imsthe following form
22994
UNITED STATES OF A!,EFI:A
L STATE OF MICHIGAN
COUNTY OF WAYNE
CIT OF LIVONIA
CONSOLIDATED TAX ANTICIPATION NOTE SERIES 1986 B
INTEREST RATE MATURITY DATE OF OFIGINAL ISSUE CUSIP
December 8, 1987 December 8, 1986
Principal Amount
The City of Livonia, County of Wayne, State of Michigan
( the "City" ) , acknowledges itself indebted to, and for value
received, hereby promises to pay to t:e bearer hereof the
Principal Amount set forth above and interest thereon at the
Interest Rate specified above on the macurity date specified
above, upon presentation and surrender cf this note at the
principal office of State Street Bank and Trust Company,
N A , New York, New York, paying agent, or at such successor
L successor note paying agent as may be designated pursuant to
the Resolution Principal and interest are payable in lawful
money of the United States of Amer_ca in immediately
available funds Interest on the notes shall be computed on
the basis of a 365 day year and the a:cual number of days
elapsed
This note is one of a series of nztes aggregating the
principal sum of Thirty-Seven Million Six Hundred Thousand
Dollars ( $37, 600, 000) issued by the Cit.! under and pursuant
to and in full conformity with the Consc:tution and Statutes
of Michigan (especially Section 3b of Chapter IV of Act
No 202, Public Acts of 1943 , as cc:ended) and a note
authorizing resolution adopted by the City Council of the
City (the "Resolution" ) The proceeds of the notes are to be
used to make payments to various tax:ng units levying ad
valorem taxes on taxable property located within the
boundaries of the City in amounts equa: to their respective
shares of the proceeds of the notes as set forth in the
Resolution
For the payment of the principal of and interest on this
note, and the series of notes of which this is one, the City
has pledged all amounts in its 1986-B N:te Payment Fund ( as
defined in the Resolution) In additlon, the City has
pledged its limited tax full faith and credit therefor
Should the funds pledged for payment of the principal of and
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interest on the notes of this ser-es be insufficient
im therefor, the City shall pay such princ:pal and interest as a
first budget obligation from its general funds, including the
proceeds of the levy of ad valorem taxes on all taxable
property in the City, subject to applicable charter,
statutory and constitutional limitations The City does not
have the authority to levy taxes for parent of the principal
of and interest on the notes in excess of applicable charter,
statutory or constitutional limitations
This note is not subject to redemption prior to
maturity
It is hereby certified, recited ant declared that all
acts, conditions and things required to exist, happen and be
performed precedent to and in the issuance of the notes of
this series, existed, have happened and have been performed
in due time, form and manner as required by the Constitution
and laws of the State of Michigan
This note shall not be valid unless the Certificate of
Authentication has been manually executed by an authorized
representative of the paying agent
IN WITNESS WHEREOF, the City of Livonia, County of
im Wayne, State of Michigan, has caused this note to be executed
in its name by the facsimile signatures of its Mayor, City
Clerk and City Treasurer and a facsim:le of its corporate
seal to be imprinted hereon
ir
22996
CITY OF LIVONIA
1110 (SEAL)
By By
City Clerk jor
By
City Treas_:er
CERTIFICATE OF AUTHENTIC;7ION
This note is one of the notes des::ibed in the within
mentioned Resolution
State Street Bank and Trust Company,
Boston, Massachusetts
By:
Authorized Representative
AUTHENTICATION DATE
imo
22997
8 NOTE PAYMENT FUND There is hereby established
imwith a bank or savings institution to be selected by the City
Treasurer an account designated the 198E-3 Note Payment Fund
into which the City Treasurer shall de;:sit as received all
December 1 , 1986 taxes collected on behalf of the Units on
and after December 1 , 1986 (except am:-nts, not to exceed
$2 , 814, 800, collected on or prior to December 15, 1986, which
will be distributed to the Units pursuant to the Agreements)
up to the amount of each Unit' s share cf the Note proceeds
plus all interest and penalties applicable thereto and any
interest earnings thereon in accordance with the Agreements
The City Treasurer also shall deposit in the 1986-B Note
Payment Fund all other amounts received ty the City pursuant
to the Agreements and by the Act, the deposit required by
Section 10 of this Resolution and all in -estment earnings on
all moneys deposited in the 1986-B Nc:e Payment Fund The
City hereby pledges all moneys and funds deposited in the
1986-B Note Payment Fund for the payment of the principal of
and interest on the Notes as the same shall become due and
payable. The principal of and interest cm the Notes shall be
paid at maturity using any moneys in the 1986-B Note Payment
Fund Until the principal of and interest on the Notes have
been paid in full, the 1986-B Note Payment Fund shall be used
for no other purpose. All amounts rena:ning in the 1986-B
Note Payment Fund after the principal of and interest on the
Notes and all expenses incurred in connection with the
22998
issuance of the Notes have been paid in full , shall be
iw transferred to the general fund of the City
9 FULL FAITH AND CREDIT OF CITY The Notes shall be
limited tax general obligations of the City and the full
faith and credit of the City is hereby pledged for the
payment of the principal of and interest on the Notes . The
City covenants that if the amounts on deposit in the 1986-B
Note Payment Fund are not sufficient to pay the principal of
and interest on the Notes when due at maturity, the City will
promptly pay from its general fund moneys as a first budget
obligation, including the proceeds of a tax levied therefor
on all taxable property within the boLndaries of the City
within applicable constitutional, statutory and charter
limitations, an amount which, when added to the amount on
deposit in the 1986-B Note Payment F-nd, will enable the
payment of such principal and interest on the Notes The
City shall not have the power to levy taxes for the payment
of the principal of and interest on the Notes in excess of
applicable constitutional, statutory or charter limitations
Nothing in this resolution shall be construed as prohibiting
the City from issuing or incurring additional limited or
unlimited tax obligations for any purposes permitted by law
10 NOTE PROCEEDS FUND There is hereby established
with a bank or savings institution to be selected by the City
Treasurer an account designated the 1986-B Note Proceeds Fund
tre into which the City Treasurer shall deposit the proceeds of
22999
the Notes The City Treasurer shall pai to the Units their
Lrespective shares of the proceeds of the Notes in accordance
with the Agreements Any amounts remaining in the 1986-B
Note Proceeds Fund after the Units have been paid their
respective shares of the proceeds of the Notes and after
payment of all costs of issuance of the Notes shall be
transferred to the 1986-B Note Payment Fund The City
Finance Director shall determine each Unit' s share of the
proceeds of the Notes in accordance with the Agreements
11 . INVESTMENT OF MONEYS. The City Treasurer is hereby
authorized and directed to invest all moneys in the 1986-B
Note Payment Fund and the 1986-B Note Proceeds Fund in
investments which are authorized as lawful investments for
cities in accordance with applicable state law subject to the
provisions of any agreements applicable to the investment of
such moneys The Treasurer is hereby al..- orized to negotiate
investment agreements with financial institutions and/or
securities dealers to provide for the investment of moneys in
said funds. The Mayor, City Clerk and City Treasurer (or
Deputy City Treasurer) are hereby authorized to execute and
deliver each of said agreements on behalf of the City with
such changes as they deem appropriate and not adverse to the
City.
12 APPROVAL OF AGREEMENTS There have been presented
to this Council the forms of Agreements between the City and
Imp the Units The Mayor, Finance Director and/or City Clerk are
23000
each hereby authorized to execute and de .:ver such Agreements
on behalf of the City and are further a.thorized to approve
any changes, corrections, additions, deletions or other
revisions to said Agreements as in the:r judgment shall be
appropriate or necessary to effect the issuance of the Notes
and which do not adversely affect the City Execution of any
Agreement shall be deemed to constitute the approval of any
such change, correction, addition, deletion or other
revision Copies of the Agreements which have been presented
to this Council shall be identified as such and placed on
file with the City Clerk The City herebi pledges all of its
right, title and interest in, to and under the Agreements to
the payment of the Notes
irm13 PAYMENT OF EXPENSES. The Finance Director is
hereby authorized and directed to pay a._ of the expenses of
the issuance of the Notes, including bu: not limited to the
fees and charges of the underwriter, from investment earnings
on the proceeds of the Notes after the payments to the Units
but before the transfer thereof to the 1986-B Note Payment
Fund or from the general funds of the City. The amount of
the expenses paid from the general funds of the City, if any,
shall be reimbursed from the 1986-B Note Payment Fund after
the principal of and interest on the Notes has been paid in
full
14 APPROVAL OF DEPARTMENT OF TREASURY. The issuance
and sale of the Notes shall be subject to permission (or an
23001
exception therefrom) being granted therefor by the Department
im of Treasury of the State of Michigan 7he applications made
by the Finance Director to the Departme:t of Treasury for a
waiver of the requirement for the public sale thereof, a good
faith deposit and credit enhancement are hereby approved and
ratified
15 OFFICIAL STATEMENT The f:rms of official
statement and preliminary official statezent for the Notes on
file with the City Clerk are hereby approved The Finance
Director is hereby authorized to execl.:e on behalf of the
City the off. cial statement with respect to the Notes and the
use by Morgan Stanley & Co Incorporated (the "Underwriter" )
of the official statement and a preliminary official
statement in connection with the market:ng, offering and sale
of the Notes is hereby approved
16 NOTE PURCHASE AGREEMENT note purchase
agreement (the "Note Purchase Agreement" ) with the
Underwriter, providing for sale of the Notes to the
Underwriters at rate of interest of 1C: 143% at a price of
$37, 653, 768 on file with the City Cler? is hereby approved
and the Mayor, Finance Director and/or City Clerk are each
authorized and directed to execute and deliver the same on
behalf of the City and sale of the Notes to the Underwriter
as provided in the Note Purchase Agreement, is hereby
approved
23002
17 SALE, ISSUANCE AND DELIVERY OF !.:TES The Finance
Director and all other officers and ager:s of the City are
authorized to do all things necessary or c:nvenient to effect
the sale, issuance and delivery of the L:tes in accordance
with the provisions of this resolution an to implement the
provisions of any agreements with respect to the issuance of
the Notes or the security for the payment cf the principal of
and interest on the Notes to which the City is a party
including the execution and delivery cf all documents,
instruments and agreements necessary therefor and are hereby
authorized to consent to such additions or changes in any of
the agreements approved by this resolL:ion as they deem
appropriate and not to the detriment of the City
ir18 MUTILATED, LOST, STOLEN OR DESTF:YED NOTES In the
event any Note is mutilated, lost, stole: or destroyed, the
Finance Director may, on behalf of the Cit.. , order the Paying
Agent to authenticate and deliver a new h:te having a number
not then outstanding, of like date, matLrlty, interest rate
and denomination as that mutilated, lost, stolen or
destroyed.
In the case of a mutilated Note, a replacement Note
shall not be delivered unless and until such mutilated Note
is surrendered to the Paying Agent. In the case of a lost,
stolen or destroyed Note, a replacement Note shall not be
delivered unless and until the Finance Director and the
1ft Paying Agent shall have received such prc:f of ownership and
'4
23003
loss and indemnity as they determine to be sufficient, which
shall consist at least of ( i ) a lost instrument bond for
principal and interest remaining unpaid on the lost, stolen
or destroyed Note, ( ii ) an affidavit of the owner (or his or
her attorney) setting forth ownership of the Note lost,
stolen or destroyed and the circumstances under which it was
lost, stolen or destroyed, (iii ) the agreement of the owner
of the Note (or his or her attorney) to fully indemnify the
City and the Paying Agent against loss due to the lost,
stolen or destroyed note and the issuance of any replacement
Note in connection with it, and (iv) the agreement of the
owner of the Note (or his or her attorney) to pay all
expenses of the City and Paying Agent in connection with the
imreplacement.
19 RESOLUTION IRREVOCABLE Except as provided in
Sections 20 and 21 hereof, upon delivery of the Notes, this
resolution shall be irrevocable until such date as all
principal of and interest on the Notes shall have been paid
in full
20. AMENDMENTS NOT REQUIRING CONSENT OF OWNERS OF
NOTES The City may, without the consent of or notice to any
of the owners of the Notes, but with notice to Moody' s
Investors Service, Inc . , if the Notes are rated by it, adopt
one or more supplements to or amendments of this resolution
for one or more of the following purposes, to (i ) cure any
low formal defect, omission, inconsistency or ambiguity in this
23004
resolution, ( ii ) add to the covenants and agreements of the
110 City in this resolution or other covenarts or agreements, or
to surrender any right or power reserved or conferred upon
the City, and which shall not adversely affect the interests
of the owners of the Notes, or (iii ) confirm, as further
assurance, any pledge of or lien on any moneys, securities or
funds securing the Notes
Before any supplemental or amendatory resolution is
entered into, there shall have been delivered to the the City
an opinion of nationally-recognized bond counsel stating that
such supplemental or amendatory resolution is authorized or
permitted by the resolution and the laws of the State of
Michigan, complies with their respective terms, will, upon
I= upon its execution and delivery, be valid and binding on the
City in accordance with its terms and will not adversely
affect the exemption from federal income taxation of interest
on the Notes.
21 AMENDMENTS REQUIRING CONSENT OF OWNERS OF NOTES.
Supplements to or amendments of this resolution other than
those described above may be made only by a supplemental or
amendatory resolution consented to in writing by the owners
of not less than 51% of the aggregate prinzipal amount of the
Notes outstanding; provided, however, that no supplemental or
amendatory resolution will be permitted which would
(a) extend the stated maturity of or time for paying interest
ir on any Note or reduce the principal am:unt of or rate of
23005
interest payable on any Note without the consent of the owner
Im of such Note; (b) prefer or give a priory to any Note over
and other Note, (c) create a claim or 1:en upon or a pledge
of the security for the Notes ranking prior to or on a parity
with the claim, lien or pledge in favor of the owners of the
the Notes except as permitted by this Resolution; (d) reduce
the percentage of the aggregate principal amount of Notes
then outstanding the consent of the owners of which is
required to authorize such supplement or amendment without in
each case the written consent of the owners of all notes then
outstanding
22 AMENDMENT OF AGREEMENTS. The Agreements between
the City and the Units may, following delivery of the Notes,
only be amended or supplemented for the p-_:rposes set forth in
Sections 20 and 21 above in accordance with the same
standards and procedures and with the approvals of the same
parties set forth in such Sections .
23 . TAX COVENANT. The City hereby covenants, to the
extent permitted by law, to take all actions within its
control necessary to maintain the exemption of the interest
on the Notes from general federal income taxation (as opposed
to alternative minimum income or other indirect taxation)
under federal tax law existing as of the date of delivery of
the Notes
24. NON-ARBITRAGE COVENANT. Notwithstanding any other
provision of this resolution or other resolutions previously
23006
adopted, the City covenants with the p_-chaser of the Notes,
that the City will make no use of the proceeds of the Notes
(within the meaning of Sections 1 . ::3-13 , 1 . 103-14 and
1 103-15 of the Income Tax Regulatio:s prescribed by the
Commissioner of Internal Revenue) whi:a, would cause the
Notes to be "arbitrage bonds. "
25 . NOTICES. For purposes of not::es to be given under
this resolution, the following addresses shall be in effect,
unless and until changed by notice from the appropriate party
to all others listed below
The City
City of Livonia
33000 Civic Center Drive
Livonia, Michigan 48154
Attention City Finance Director
The Underwriter
Morgan Stanley & Co. Incorporated
1251 Avenue of the Americas
New York, New York 10020
Attention: Dennis Santos
The Paying Agent
State Street Bank and Trust Cc pany, N.A.
61 Broadway
New York, New York 10004
26 PRIOR RESOLUTIONS All resolti.::ons and parts of
resolutions insofar as they conflict with the provisions of
this Resolution are hereby rescinded
23C07
EY.EIBIT A
ALLOCAT::% OF DECEIBER 1 LE ':
Amount of
Mount of Anticipated
Anticipated Levy Paid
Amount Amount Levy Paid from
of of Levy (%) of from Note Collections
lnit Levy Anticipated Total Levy Proceeds December 1-15
Livonia 529, 186,404 $26,729,485 (91 58%) 52.6,972 , 196 $1 ,757,293
Public
Schools
School
District
Schoolcraft 1 ,997,540 1 ,829,387 (91 58%) 1 ,709 , 116 120,271
Community
College
District
Wayne County 1,845,397 1 ,690,05: (91 58%) 1 ,578,941 111,110
Inter-
mediate
School
District
Clarenceville 1 ,952,060 1 ,787 ,733 (91 58%) 1 ,670,203 117 ,532
School
District
Charter 11,768,841 8,378,13E (71 19 .)* 7,669,544 708,594
County of
Wayne
$46,750,242 $40,414,80: 537,600,000 $2,814,800
*Reduced to reflect issuance of tax anticipation notes authorized by the County
and expected to be delivered in early December, 1986
A roll call vote was taken on the foregoing resolution with t^e following result:
AYES. McCotter, Feenstra, McCann, Taylor, 5ennett, Ochala, Bishop.
NAYS None.
23008
On a motion by Councilman Bennett, seconded by Councilwoman McCotter, and
unanimously adopted, this 199th Special Meeting of the Council of the City of Livonia
was duly adjourned at 7:25 P.M. , December 4, 1986
xstd-t
Robert F Nash, City Clerk