HomeMy WebLinkAboutOrdinance - 8195-1981 - Auth $9,000 For Electric Light And Power System Rev. Bonds, Series 1981 - 05/14/1981II
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ORDINANCE NO. 8195
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AN ORDINANCE by the City Council of the City of Lubbock,
· Texas, authorizing the issuance of $9,000.000 "CITY
OF LUBBOCK, TEXAS, ELECTRIC LIGHT AND POWER SYSTEM
R~~NUE BONDS, SERIES 198l", for the. purpose•. of pro-
viding funds for making improvements and extensions
~o the City's Electric Light andPower System, i.e .
improvements and extensions to the transmission and
distribution facilities, as authorized by the General
Laws of the State of Texas, particularly Article 1111,
et seq., and Article 2368a, V.A.T.C,S.; prescribing
the form of the bonds and the form of the interest
coupons; pledging the net revenues of the City's
Electric Light and Power System to the payment of the
principal of and interest on said bonds; and enacting
provisions incident and relating to the subject and ·
purpose of this ordinance; and providing an effective
date.
WHEREAS, the City of Lubbock, Texas, has heretofore author-
ized the issuance of six series of revenue bonds (hereafter
defined as "previously issued bonds") which are payable from and
secured by the net revenues of the City's Electric Light and
Power System; and
WHEREAS, the City Council of the City of Lubbock, rexa.s,
has determined that additional revenue bonds should be issued
for the purpose of providing funds for making improvements and
extensions to the City's Electric Light and Power System, i.e.
improvements and extensions to the transmission .and distribution
facilities. which revenue bonds shall be "additional bonds" as
such term is defined in the ordinances authorizing the previously
issued bonds, payable from and secured by the net. revenues of the ·
City's Electric Light and Power System in all things on a parity
with the previously issued bonds; and
WHEREAS, notice.of the City's intention to issue the series
of bonds herein authorized has been given in d!,!e time. fo.rm and
manner required by applicable law in that such notice has been
published in a new.,;paper, published in and of general circul.ation
in the City of Lubbock, Texas, once a week for two consecutive
weeks, the date of the first publication having been not less
than 14 days prior to the date set in the notice for the passage
of this ordinance; and
WHEREAS, no petition, signed by 10% of the qualified electors
or 10% of the qualified property taxpaying voters has been pre~
sented to the City Secretary, the City Manager or any member of
the Council requesting that a referendum election be called on
the questipn of whether the revenue bonds, as described in the
foresaid notice should be issued and therefore this Council is
authorized to proceed with the authorization, issuance, and de.-'-
li very of such bonds; and
WHEREAS, this City Council finds and determines: (1) that the Mayor and City Treasurer have certified that the City is not
in default as to any covenant, condition or obligation prescribed
by the ordinances authorizing the issuance of the outstanding
bonds, including showings that all interest, sinking and reserve
funds provided for have been fully maintained in accordanc,.e with
the provisions of said ordinances; (2) that the Ciqr has secured from an independent Certified Public Accountant his written report
demonstrating. that the net revenues of the Syster.1 were, during
the last completed fiscal year, or during any consecutive twelve
(12) month period of the last fifteen (15) consecutive months
prior to the month of adoption of the ordinance authorizing the
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additional parity· bonds, equal to at least one and one-half ..
(1-1/2) times the average annual principal and interest require-
ments of all the bonds which will be secured by a first lien on
and pledge of the net revenues of the System and which will be
outstanding upon t~e issuance of the additional parity bonds; and
further demonstrating that for the same period as is employed in
:j . arriving at the aforementioned test said· net revenues were equal !1 to at least one and one-fifth (1-1/5) times the maximum annual ii principal and interest requirements of all such bonds as will be
I! outstanding upon the issuance of the additional parity bonds;
!j now, therefore, ·
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BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK, I
SECTION 1: Authorization -Princi al Amount -Desi ation. ~ That in order to orrow t e sa1. sum o c i.: .... ,. ........ v., RS
($9,000,000) for the purpose of providing funds for making improve
men ts and extensions to the City's Electri.c Light and :Power System,
L.e. improvements and extensions to the transmission and distri-
bution facilities, pursuant to the General Laws of the State of
Texas, particularly Article 1111 et seq .• and Article 2368a,
V.A.T.C.S.; this Council has determined that there shall be issued
at'ld there is hereby ordered to be issued a series of coupon bonds,
to be designated ''CITY OF LUBBOCK, TEXAS, ELECTRIC LIGKT AND POWER
SYSTEM REVENUE BONDS, SERIES 1981," aggregating in principal
amount the sum of NINE MILLION DOLLARS ($9,000,000), which said
series of bonds, together with the outstanding and unpaid
previously issued bonds {as herein defined) shall be payable as
to both principal and interest solely from and equally secured
by a first lien on and pledge of the net revenues of the City's
Electric Light and Pow-er System.
SECTION 2: Date -Numbers -Maturity -Interest Rate.
Said bonds shall be dated August 15, 1981. shall be numbered
consecutively from One (1) through Eighteen Hundred (1,800);
shall each be in the denomination of Five Thousand Dollars
($5,000), aggregating the principal sum of NINE MILL!ON DOLLARS .
($9,000,000); and shall bear interest and become due and ~ayable
serially on April 15 in each of the years. in accordance with
the following schedule:
BOND NUf,IBERS INTEREST
(All Inclusive) YEAR PRINCIPAL RATE
1 to 90 1983 450,000 %
91 to 180 1984 450,000 %
181 to 270 1985 450,000 %
271 to 360 1986 450,000 . %
361 to 450 1987 450,000. o/o
451 to 540 1988 450,000 %
541 to 630 1989 . 450,000 %
631 to 720 1990 450,000 %
721 to 810 1991 450,000 %
811 to 900 1992 450,000 %
901 to 990 1993 450,000 %
991 to 1080 1994 450,000 7.
1081 to 1170 1995 450,000 %
1171 to 1260 1996 450,000 %
1261 to 1350 1997 450,000 %
1351 to 1440 1998 450,000 %
1441 to 1530 1999 450,000 %
1531 to 1620 2000 450,000 %
1621 to 1710 2001 450,000 %
1711 to 1800 2002 450,000 %
PROVIDED, HOWEVER, that the City of Lubbock, Texas, reserves the
right to redeem bonds maturing in the year 1992 and therea!ter,
in whole or any part thereof, on April 15, 1991 or on any.interest·
payment date thereafter, at t~e price of par and accrued interest
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Ito the date fixed for redemption plus a premium of 2-1/2% of the
principal amount of all bonds called for redempti.on on April 15
1991, such premium reducing 1/2 of 1% on each April 15 thereaft~r
until April 15, 1996, on and after which date said bonds shall
be optional at the price of par and accrued interest; and PROVIDED,!
FURTHER, that at least thirty (30) days prior to any interest
payment date upon which any of said bonds are to be red_eemed,
notice of redemption signed by the City Secretary-Treasurer of _ ·
said City (specifying the serial numbers and amount of bonds to
be redeemed) shall have been filed with the. CITIBA..l'tK, NATIONAL
AS1;,0CIATION, New York, New York, and vtith the TEXAS COMMERCE BANK,.
NATIONAL ASSOCIATION, Lubbock, Texas {the paying agents named in
each of said bonds). Should any bond or bonds not be presented
for redemption pursuant to such notice, and if by the date so fixe
for redemption the City shall have made available funds in amounts
sufficient to pay the bonds and accrued interest thereon to the
date of redemption, pursuant to such notice, the same shall cease
to bear interest from and after the date so fixed for redemption.
SECTION 3: Interest. That said bonds shall bear interest
from date to maturity at the rate or rates showri in the above _
schedule, such interest to be evidenced by proper coupons attached
to each of said bonds; and said interest shall be payable-on
April 15,. 1982, and semiannually thereafter on October 15 and
April 15 in each year.
SECTION 4: Places of Payment. Both principal of and int:P.res
on th1.s 1.ssue of bonds shall be payable in lawful money of the
United States of America, without exchange or collection charges
to the owner or holder, at the CITIBANK, NATIONAL ASSOCIATION,
New York, New York, or, at the option of the holder, at the TEXAS
COMr·ffiRCE BANK, NATIONAL ASSOCIATION, Lubbock, Texas, upon pres en"'.'
tation and surrender of bonds . or proper coupons.
SECTIONS: ..----..-------.------...---.----.-The seal of said City may be impresse on eac o sa1. on s or, in the alter-
native, a facsimile of such seal may be printed on the said bonds. I
The bonds and interest coupons appurtenant thereto may be executed!
by the imprinted facsimile signatures of the Mayor and City Secre•q::
tary of the City and execution in such manner shall have the same ·
effect as if such bonds and coupons had been signed by the Mayor
and City Secretary in person by their manual signatures. Inasmuch
as such bonds are required to be registered by the Comptroller of
Public Accounts for the State of Texas, only his signature (or
that of a deputy designated in writing to act for the Comptroller)
shall be required to be manually subscribed to such bonds in con-
nection with his registration certificate to appear ~hereon, as
hereinafter provided; all.in accordance with the provisions of
Article 717j-l, V.A.T.C.S.
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SECTION 6: Form of Bonds.
be substant1.ally as follows:
That the form of said bonds shall i
NO. UNITED STATE OF AMERICA
STATE OF TEXAS
COUNTY OF LUBBOCK
$s.ooo l
CITY OF LUBBOCK, TEXAS, ELECTRIC LI.GHT AND POWER
SYSTEM REVENUE BOND, SERIES 1981
FOR VALUE RECEIVED, the City of Lubbock, a municipal corpora-
tion of the. Stat.e of Texas, hereby acknowledges itself indebted to
and promises to pay to bearer, as hereinafter stated, on the 15th
day of April, 19_, the sum of
FIVE THOUSAND DOLLARS
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($5,000), in lawful money of the United States of America, with
interest thereon from the date hereof to maturity at the rate of
PER CENTUM ( · ·. · %) per annum, payable
on April 15, 1982, and semiannually thereafter on October 15 and
April 15 in each year, and interest falling due on or prior to
maturity hereof is payable only upon presenation and surrender
of the interest coupons hereto attached as they severally become due. · · .
BOTH PRINCIPAL OF and interest on this bond are hereby made
payable at the CITIBANK, NATIONAL ASSOCIATION, New York, New York,
or at the option of the holder, at the TEXAS COMI-!ERCE BANK, NATION!
ASSOCIATION, Lu.· bbock, Texas, w.ithout excha.·nge or collection charge to the owner or holder, and the said City of Lubbock, Texas, is
hereby held and firmly bound to apply the pledged appropriated
net revenues of its Electric Light and Power System to the prompt
payment of principal of and interest on this bond at maturity, and
to pay said principal and interest as they mature~
THIS Botm is one of a series of bonds aggregating in amount
NINE MILLION DOLLARS ($9,000,000) , numbered consecutively from ·
One (1) through Eighteen Hundred (1,800), each in denomination
of Five Thousand Dollars ($5,000), issued for the purpose of
.providing funds for making improvements and extensions to the
City's Electric Light and Power System.· i.e. improvements and
extensions to the transmission and distribution facilities, in
accordance with the Constitution and laws of the State of Texas,
particularly Article 1111 et seq. ,and Article 2368a, V.A.T.C.S .•
and pursuant to the Charter of said City and an ordinance passed
by the City Council of the City of Lubbock, Texas, and duly
recorded in the Minutes of said City Council.
I AS SPECIFIED in the ordinance hereinabove mentioned, the · !
City reserves. the right to re.deem the bon.ds of this series matur-.1· ing in the years 1992 and thereafter, in whole or and part thereof
on April 15, 1991, or on any interest payment date thereafter,.at
the price of par and accrued interest to th.e date fixed for redemp
tion plus a premium of 2~ 1/2% of the principal amount of all bonds I
called for redemption on April 15, 1991, such premium reducing . I
1/ 2 of 1% on each April 15 thereafter until April 15. 1996, on and1·
after which date said bonds shall be optional at the price of par
and accrued interest; and PROVIDED, HOWEVER, that at least thirty I
(30) days prior to any interest payment date upon which any of I
said bonds are to be redeemed, notice of redemption signed by the'
City Secretary-Treasurer of said City (specifying the seriaL
ntnnbers and amount of bonds to be redeemed) shall have been filed
with the CITIBANK, NATIONAL ASSOCIATION, New York, New York, and
with the TEXAS COMMERCE BANK, NATIONAL ASSOCIATION. Lubbock,
Texas. Should any bond or bonds not be presented for redemption
the City shall have made availal;il:e funds in amounts sufficient
to pay the bonds and accrued interest thereon to the date of
redemption, pursuant to such notice, the same shall cease to bear
interest from and after the date so fixed for redemption.
THE DATE of this bond in conformity with the ordinance above
mentioned is April 15, 1981.
THIS BOND and the series of which it is a part constitute
special obligations of the City of Lubbock, Texas, and, together I
with the outstanding and unpaid previously issued bonds (as defin1d in the ordinance authori.zing the series of bends of which this is 1
one), are payable solely from and equally secured by a first lien I
on and pledge of the net revenues of the City's Electric Light i
and Power System.
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THE ere. however, expressly reserves the right to issue
further and additional revenue bond obligations, in all things
on a parity with the outstanding previously issued bonds and the
bonds of this series and payable solely from and equally secured
by a first lien on and pledge of the net revenues of the Ciy's
Electric Light and Power System; PROVIDED, HOWEVER, that any and
a:11 such additional parity bonds may be so issued only in accord-
anc·e with and subject to the convenants. conditions, limitations
and restrictions relating thereto which are set out and contained
in the ordinance authorizing. this series and to which ·said ordi-: ·
nance reference is hereby made for more complete and full partic-.· ..
ulars. · j
THE HOLDER hereof shall never have the right to demand pay-. I
ment of this obligation out of any funds raised or to be raised
by taxation.
AND IT IS HEREBY CERTIFIED AND RECITED .that the issuance
of this bond, and the series of which it is a part, is duly
authorized by law; that all acts, conditions and things required
to exist and to be done precedent to and in the issuance of this
bond to render the same lawful and valid have been properly done.·
have happened and have been performed i.n regular and due time,
fqrm arid manner as required by the Constitution and laws of the
State of Texas and the ordinance· hereinabove mentioned; that this
series of revenue bonds does not exceed any constitutional or
statutory limitation; and that provision has been made for the
payment of the principal of and interest on this bond and the
series of which it is a part by irrevocably pledging the net
revenues of the Electric Light and Power System of the City of
Lubbock, Texas.
IN TESTIMONY WHEREOF, the City Council of the Ci.ty of
Lubbock, Texas. in accordance with the provisions o:f Article
717j-l, V.A.T.C.S., has caused the seal of said City to be
impressed or a facsimile thereof to be printed hereon, and
this bond and its appurtenant coupons to be executed with the
imprinted facsimile signatures of the Mayor and City Secretary
of said City, as of the lSth day of April, 1981.
Mayor, City of Liihbock. Texas
COUNTERSIGNED:
City Secretary, Ci.ty of Lubbock,
Texas
. SECTION 7: Couton Form. The form of said interest coupons
shall be substantial y as follows:
ON THE 15TH DAY OF ______ _
19_,
NO. $ __ _
*(unless the bond to which this coupon pertains h~s been
properly called for redemption in accordance with its terms,)
the CITY OF LUBBOCK, a municipal corporation of the State of
Texas, hereby promises to pay to bearer. out of funds specified
in the bond to which this coupon is attached (without right to
demand payment out of any funds raised or to be raised by taxa-
tion), and in lawful money of the United States of America, with-
out exchange or collection charges to the o~mer or holder, at the
CITIBANK, NATIONAL ASSOCIATION, New York, New York, or, at the
option of the holder, at the TEXAS COMMERCE BANK, NATIONAL ASSO-
CIATION, Lubbock, Texas, the sum of
DOLLARS ----------
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($ __ ~=), , said sum being • ...,....___,,.,...,=months• interest due that
day on "CITY OF LUBBOCK, TEXAS, ELECTRIC LIGHT AND POWER SYSTEH
REVENUE BOND, SERIES 1981," dated April 15, 1981. Bond No.
City Secretary Mayor
SECTION 8: Form of Comptroller's Certificate-. Substantially-
the following shall be printed on the back or each bond:
OFFICE OF COMPTROLLER
STATE OF TEXAS
§
§
§
REGISTER NO.
I HEREBY CERTIFY that there is on file and of record in my
office a certificate of the Attorney General of the State of Texas
to the effect that this bond has been examined by him as required
by law, and that he finds that it has been issued in conformity
with the Constitution and laws of the State of Texas; and that it
is a valid and binding special obligation of the City of Lubbock,
Texas, payable from the revenues pledged to its payment by and !
in the ordinance authorizing same, and said bond has this day 'I
been registered by me. _
WITNESS MY HAND AND SEAL OF OFFICE at Austin, Texas,
Comptroller of Public Accornts
of the State of Texas
SECTION 9: Definitions. For all purposes of this ordinance
and in particular for clarity with respect to the issuance of the
bonds herein authorized and the pled~e and appropriation of reve-
nues therefor, the following definitions are provided:
"<NOTE TO PRINTER: The expression in parentheses to he included
only in coupons maturing October 15, 1991 and subsequent pertainin
to optional bonds maturing in the years 1992 and subsequent.
(a) The te:rm ":System" shall mean all properties
real, personal, mixed or otherwise, now ot,med or here-
after acquired by the City of Lubbock through purchase,
construction or otherwise, and used in connection with
the City's Electric Light and Power System and in anywise
appertaining thereto, whether situated within or without
the limits of the City.
(b) The term "net revenues'' shall mean the gross
revenues of the City's Electric Light and Power System
less the expense of operation and ma:i,nte.nance. Such
expense of operation and maintenance shall not include
depreciation charges or funds pledged for the bonds,
previously issued bonds and for additional parity bonds
hereafter authorized, hut shall include all salaries,
labor, materials, repairs, extensions necessary to render
services; provided, however, that in determining "net reve-
nues," only such repairs and extensions as in the judgment
of the City Council, reasonably and fairly exercised are
necessary to keep the System in operation and render ade-
quate service to the City and inhabitants thereof, or
such as might be necessary to remedy some physical
defect which otherwise would impair the security of
the bonds, previously issued bonds. or additional
parity bonds permitted to be issued under Section 19
hereof, shall be deducted.
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(c) The term "bonds" whenever same appears in
this ordinance without any qualifying language, shall
mean the revenue bonds authorized by this ordinance.
(d) The term "previously issued bonds" shall mean
the outstanding and unpaid bonds designated "CITY OF
LUBBOCK, TEXAS, ELECTRIC LIGHT AND POWER SYSTEM REVENUE
BONDS," further identified by Series and dates as follows:
(1) Series 1964, dated March 15, 1964, in the original
principal amount -of $4,500,000;
(2)
(3)
(4)
(5)
(6)
Series 1965, dated March 15, 1965, in the original.
principal amount of $3,000,000;
Series 1973, dated July 15, 1973, in the original
principal amount of $6,000,000;
Series 1975, dated March 15~ 1975, in the o.riginal
principal amount of $6,400,000~ and ·
Series 1975-A, dated September 15, 1975, in the
original-principal amount of $2,000,000;
Series 1976, dated AJ?ril 15, 1976; in the original
principal amount of ~4,400,000.
(e) The term "additional bonds" or "additional
parity bonds" shall mean those bonds which the City
reserves the right to issue under the provisions of
Section 19 hereof.
(f) The term "bonds similarly secured" shall mean ·
the previously issue bonds, the bonds and the additional
bonds at the time outstanding.
SECTION 10: Pledge. The City of Lubbock covenants, reaf-
firms and agrees that all of the net revenues of the System are
hereby irrevocably pledged equally for the payment of principal
of and interest on the bonds, previously issued bonds and addi-
tional parity bonds, if issued under the conditions and in the
manner specified in this ordinance, all of which shall consti-
tute a first lien on and pledge of the net revenues of the System.
SECTION 11~ Rates and Charges. The City of Lubbock cove-
nants, reaffirms and agrees that so long as any of the revenue
bonds and coupons authorized herein, and any of. the previously
issued bonds and coupons remain outstanding and .unpaid, it shall
fix and maintain rates and collect charges for the facilities and
services afforded by its Electric Light and Power System, which
will produce income and revenues sufficient .at all tirnes,·to: ·
(1) Pay all necessary operation,. maintenance
and_ betterment charges and expenses of the System;
(2) Establish and fully maintain the "Bond Fund"
including the reserve portion thereof for the bonds
herein authorized, the previously issued bonds and for
any additional parity bonds hereafter issued in accord-
ance with the provisions hereof:
(3) Pay the requirements of all other lawful obli-
gations and indebtedness of the System chargeable against
the System, as and when the same shall accrue and become
due.
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SECTION 12: System Fund. All receipts, revenues and in-
come of every nature in any manner derived from ownership and
operation of the System shall constitute a separate and sacred
fund which in no event shall be diverted or drawn upon except
under the provisions and for the purposes herein prescribed.
All .such receipts, revenues and income shall be paid over and
deposited with City's depository within twenty-four (24) hours
after collection. The account to which said Fund shall be de-
posited shall be known as the ELECTRIC LIGHT AND POWER SYSTEM
FUND (hereinafter referred to as the "System Fund") to be kept
separate and part from all other City funds or accounts. Spe•
cifically as related to the bonds herein authorized and the
previously issued bonds, the System Fund shalL be and is hereby
pledged and shall be devoted and applied to the purposes enumer-
ated in Section 13 following and in the order of precedence shown
therein.
SECTION 13: Flow of S~stem Fund. All moneys paid over and deposited in the System Fun as provided in Section 12 above shaii
be pledged, appropriated and employed as follows:
(1) For the payment of those necessary and reasonable
expenses of operating and maintaining the System ;,_; are set
forth in Section 9(6) hereof relating to the defirtition .of "net revenues", and ·
(2) To the 11Special Electric Light and Power System
Revenue Bond Retirement and Reserve Fund" (hereinafter re-,
£erred to as the "Bond Fund") heretofore created and hereby
reaffirmed for the bonds, previously i.ssued bonds and such
additional parity bonds as may hereafter be issued under
the provisions of Section 19 hereof. Said Bond Fund shall
be used for no purpose other than for the payment, redemp-,
tion and retirement of such bonds and the interest thereon
in accordance with the terms and provisions of the ordinances
authorizing their issuance. All funds received from the
purchasers of such bonds as accrued interest thereon shall
be placed in the Bond Fund. The City covenants. reaffirms
and agrees to provide the Bond Fund.with all amounts required
to pay as due, each of the principal and interest install-
ments pertaining to all bonds, previously issued bonds and
additional parity Bonds, and that in addition thereto said
Bond Fund shall contain a Reserve Portion. Said Reserve
Portion of the Bond Fund presently contains not less than
$1,625,000 (which amount is the sum required to be on deposit
therein by the provisions of the ordinances authorizing the l
previously issued bonds). I
. I . I On or before the 1st day of September, 1981, and on or b -
fore the first day of each month thereafter, the.City shall
deposit into the reserve fund portion of the Bond Fund the
additional amount of $4,583.34 aud·_such monthly deposit shall
continue to be made until the Reserve Portion of the Bond
Fund contains the sum of $1,900,000 (which includes the
amounts required to be deposited in said reserve by the
provisions of the ordinances authorizing the previously issue
bonds) in .cash and book value of investment securitiies, such
total amount being not less than the average annua~ principal.
and interest requirements of all series of bonds which are
secured by a first lien on and pledge of the net revenues of
the System and which are to be outstanding after the issu-
ance of the bonds herein authorized. In the event the City
elects to increase the monthly deposits to the reserve fund
portion of the Bond Fund, the amount in excess of the require
monthly deposit shall serve as a credit to the amount require
to be deposited in the next month or months.
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Scd.d Reserve Portion shall be made available for
and reasonably employed in meeting the requirements of
the Bond Fund if need be, and if any amount thereof is
so employed, said Reserve Portion shall be supplemented
out to the first System Funds available therefor to such
extent as will, as rapidly as possible, fully restore
same to the sum of $1,900,000 .
The ordinances of the City Council authorizing any
series of additional parity bonds shall make due provision
for supplementing, if necessary, the Reserve Portion of the
Bond Fund so that same shall be accumulated and maintained
in an amount equal to not less than the average annual
principal and interest requirements of all series of bonds
then to be secured by a first lien on and pledge of the net
revenues of the System and which will be outstanding upon
the issuance of any series of additional parity bonds.
SECTION 14: Method of Providing Amounts for Princiaal
and Semiannual Interest Requirements of the Bonds. Ime 1.ately
following the delivery of the bonds herein authorized and on
or. before each May 1 and November 1 following such delivery the
City Treasurer shall calculate the amount of money which is re-
quired to pay the interest on the bonds on the next succeeding
interest payment date herein authorized and cause such amount
to be deposited in the Bond Fund in equal monthly installments.
Immediately following the delivery of the bonds herein author-
ized and on or before the first day of each May following such
delivery the City Treasurer shall calculate the amount of money
which is required to pay any principal of the bonds herein au-
thorized which is scheduled to mature within 12 months and cause
such amount to be deposited in the Bond Fund in equal monthly
installments. Such amounts, as determined to be required, shall
be withdrawn from the System Fund on or before the first day of
each month, except that the initial deposit following the de-..
livery of bonds shall be made as soon as possible following such
delivery of bonds. The deposits required to be made (by the
provisions of this Section) are in addition to the am::nmts re-
quired to be paid into said Bond Fund for the purpose of paying·
the principal of and interest on the previously issued bonds as
prescribed by the ordinance authorizing their issuance.
In the event the income and revenues of the System are
insufficient in any month to permit the required deposits into
the Bond Fund in accordance with the provisions hereof or if
for any other reason the City shall fail to make the required
deposits into the Bond Fund ("including the Reserve Portion if
same has become depleted), the amount of such deficiencies shall
be made up as promptly as available System Funds will permit.
· SECTION 15: S'U¥-Elus Revenues. After all requirements of
Section 13(1) and ("2 hereof have been satisfied and. all similar
requirements of any additional parity bonds hereafter issued and
after all deficiencies existing in such requirements have been
remedied, surplus revenues of the System may be used for any other
proper City purposes now or hereafter permitted by General Law,
including the use thereof:.0for. :r:et.i:ti~g~inc:.advanee-oL.maturity any
such bonds or additional parity bonds by purchase on the open
market at not exceeding the market value thereof. Nothing herein
shall fie construed, however, as impai.ring the right of the City
to pay, in accordance with the provisions thereof, any junior
lien bonds legally issued by it.
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SECTION 16: Security for Electric Light and Power System
Bond Fund. AII funds herein provioed for the Bond Fund hereto-
fore established and herein reaffirmed shall be kept. separate and
apart from all other City funds and shall be continuously secured
bf~ valid pledge of direct obl~gations of, or obligations uncon-
ditionally guaranteed by the United States of America, having a
par value, or market value when less than pa~, exclusive of accrue
interest, at all times at least equal to the amount of money to be
deposited -in said Fund. All sums deposited in said Bond Fund shaLl
be held as a trust fund for the benefit of the holders of the bonds
herein authorized and the previously issued bonds, the beneficial
interest in which shall be regarded as existing in such holders.
To the extent that money in the Reserve Portion of the Bond Fund
is invested under the provisions of Section 18 hereof, such securi is not.required.
SECTION 17: Custodian of Bond Fund. The custodian of the
Bond Fund shaII be the City's ofhciaI depository hank, and all
deposits prescribed shall oe placed in said Fund with said
custodian bank .. Prior to each interest and principal maturity
date, it shall be the duty of the City Treasurer to withdraw from
said Fund and place with the paying agent banks money in such
amounts as will be fully sufficient to pay and at such times as
will permit prompt payment of each interest and principal install-
ment ..
SECTION 18: Investment of Reserve Portion of Bona Fund.
The custodian bank shall, when authorized by the City Council,
invest the Reserve Portion of the Bond Fund in direct obligations
of, or obligations guaranteed by the United States of America, or
invested in direct obligations of the Federal Intermediate Credit
Banks, Federal Land Banks, Federal National Mortgage Association.
Federal Home Loan Banks or Banks for Cooperatives, and which such
investment obligations must mature or be subject to redemption at
the option of the holder, within not to exceed ten years from the
date of making the investment. Such obligations shall be held by
the depository impressed with the same trust for the benefit of th
bondholders as the Bond Fund itself, and if at any time uninvested.
funds shall be insufficient: to permit payment of principal and
interest maturities herein authorized as herein directed, the said
depository shall sell on the open market such amount of the securi
ties as is required to pay said oonds and interest when due and
shall give notice thereof to the City Treasurer .. All moneys re-
sulting from maturity of principal and interest of the securities
in which the reserve funds are invested shall be reinvested or
accumulated in said Reserve Portion of said Bond Fund and con-
sidered apart thereof and used for and only for the purposes
hereinabove provided with respect to said reserve, provided that
when the full amount required to be accumulated in the Reserve
Portion of the Bond Fund (being the amounts required to be accumu-
lated by the ordinances authorizing.the bonds sjmilarly secured),
any interest increment may be used in the Bond Fund to reduce the
.payments that would otherwise be required to pay the debt service
requirements on oonds similarly secured.
SECTION 19: Issuance of Additional Paritz Bonds. J:n_addi-
tion to the right to issue bonds of inferior lien as authorized
by the laws of the State of Texas, the City of Lubbock reserves
the right to issue additional revenue bonds payable from the net
income and revenues of the System, and when issued in compliance
with law and the terms and conditions hereinafter appearing, such
additional bonds shall occupy a position of parity with and shall
be equally and rat ably secured by a first lien on and pledge of.
the net revenues of the System to the same extent as the series
of bonds authorized by this ordinance and the previously issued
bonds. The City hereby covenants, reaffirms and agrees that no
additional bonds or other obligations payable from the net reve-
nues of its Electric Light and Power System shall be issued on a·
parity with the series of bonds herein authorized and with the previously issued bonds, unless and until the following conditions
have been met:
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(a) That the Mayor and City Treasurer have certi-
fied that the City is not then in default as to any cove-
nant, condition or obligation prescribed by this ordinance,
the ordinances authorizing the issuance of the previously
issued bonds, or any ordinance authorizing the issuance of
additional parity bonds then outstanding,·including showings
that all interest, sinking and reserve funds then provided
for have been fully maintained in accordance with the pro-
visions of said ordinances;
(b) That the applicable laws of the State of Te:X.as in
force at the time provide permission and authoirty for the
issuance of such bonds and have been fully complied with;
(c) That the City has secured from an independent
Certified Public Accountant his written report demostrating
that.the net revenues of the System were, during the last
completed fiscal year, or during any consecutive twelve
(12) months period of the last fifteen (15) consecutive
months prior to the month of adoption of the ordinance
authorizing the additional parity bonds. equal to at
least one and one-half (1-1/2) times the average annual
principal and interest requirements of all the bonds which
will oe secured oy a first lien on and pledge of the net
revenues of the System and which will be outstanding upon
the issuance of the additional parity bonds; and further
demonstrating that for the same period as is employed in
arriving at the aforementioned test said net revenues were
equal to at least one and one-fifth (1-1/5) times the maxi-
mum annual principal and interest requirements of all such
bonds as will be outstanding upon the issuance of the addi-
tional parity bonds; .
(d) That the additional parity bonds are made to
mature on April 15 or October 15, or both. in each of the
years in which they are provided to mature;.
(e) As hereinabove provided the Reserve Portion of
the Bond Fund shall be accumulated and supplemented as
necessary to maintain it in a sum which shall be not less
than the average annual principal and inte-rest requirements
of all bonds secured by a first lien on and pledge of the
net revenues of the System which wil.l be ou.tstanding upon
the issuance of any.series of additional parity bonds.
Accordingly, each ordinance authorizing the issuance of
any series of additional parity bonds shall provide.for
any required increase in sa.id'Reserve Portion, and;if
supplementation is necessary to meet all conditions of
said Reserve Portion, said ordinances shall make. provision
that same be supplemented by the required amounts in
equal monthly installments over a period of not to exceed
sixty (60) calendar months from the dating of such addi-
tional parity bonds.
When thus issued, such additional parity bonds may be
secured by a pledge of the revenues of the City's System on a
. parity in all things with the pledge s.ecuring the issuance of
the bonds herein authorized and the previously issued bonds.
SECTION 20: Maintenance and Operation. The. City of Lubbock
hereby covenants, reaffirms and agrees that it will maintain the
System facilities in good condition and operate the same in an
effecient manner and at reasonable costs so long as the bonds,
previously issued bonds or the additional parity bonds are out-
standing and unpaid. The City further agrees to maintain insur-
ance for the benefit of the holder or holders of the bonds of the
kinds and in the amounts which are usually carried by private com-
panies operating similar properties, and that during such time all
policies of insurance shall be maintained in. force and kept curren~ .
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as to premitnn payments. All moneys received from losses under
such insurance policies other than public liabilitv policies are
hereby pledged as se?urity ~or th7 bonds until and'unless the pro-
ceeds thereof are paid out in making good the loss or damage in
respect of which such proceeds are received, either by replacing
the property destroyed or repairing the property damages, and
adequate provisions made within ninety (90) days after the date
of the loss for making ~ood such loss or damage. The,premiums
for all insurance policies required under the provisions of this
section shall be considered as maintenance and operation expenses.
SECTION 21: Records and Accounts. The City of Lubbock here-
by covenants, reaffirms and agrees that so long as any of the
bonds herein authorized or the previously issued bonds, or any
interest thereon, remain outstanding and unpaid, it will keep and
maintain a proper and complete system of books, records and ac-
counts pertaining to the operation of the System. separate and
apart from all other records and accounts in which complete and .
correct entri·es shall be made of all transactions relating to the
System as provided by applicable law, and that the holder or holder
of any of the bonds or any duly authorized agent or agents of such
holders shall have the right at all reasonable times to inspect
all such books, records, accounts and data relating thereto and
to inspect the System and all properties comprising same. The
appropriate City officials are hereby instructed and directed to
do any and all things necessary or covenient in reference to keep-
·itrn and maintaining of such books, records and accounts and to
make the moneys available for payment of the bonds in the manner
provided by the aforementioned statute. The City further agrees
that within sixty (60) days following the close of each fiscal
year it will cause an audit of its books and accounts to be matle
by an independent firm of Certified Public Accountants showing
the receipts and disbursements for the account of the System for
the fiscal year. Each such audit shall, in addition to whatever
other matters may be thought proper by the Accountant. particularl
include the following:
(a) A detailed statement of the income and expen-
ditures for account of the System for such fiscal year;
(b) A balance sheet as of the end of such fiscal
year;
(c) The Accountant's comments regarding the manner
in which the City has carried out the requirements of this
ordinance, and his recommendations for any change or im-
provements in the operation, records and accounts of the
System;
(d) A list of the insurance policies in force
at the end of the fiscal year on system properties,
setting out as to each policy the amount thereof, the
risk covered, the name of the insurer and the policy's
expiration date;
(e) A statement verifying that the securities
herein specified therefor have been on deposit as security
for the money in the Electric Light and Power System.bond
Fund throughout the fiscal year, and a list of the securi-
ties, if any, in which the reserve portion of such Special
Fund have been invested;
(f) The number of metered and unmetered customers,
if any, connected with any department of the System,
showing totals at the end of the fiscal year.
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Expenses incurred in making the audits above required are to
be regarded as maintenance and operation expenses and paid as such.
Copies of the aforesaid annual audit shall be promptly furnished
the original purchasers, of the bonds and any subsequent holder at
his request. At the close of the first six months' period of the
fiscal year, the City Manager is directed to . furnis_h a copy. of· an
operating and income statement in reasonable detail covering such
period to any bondholder upon his request therefor, received not
more than thirty days after the close of said six months' period.
Any bondholder shall have the right to discuss with Accountants
making the annual audit the contents thereof and to ask the City
Manager for such additional information as he may reasonably reques
SECTION 22: Remed~ in Event of Default. In addition to
all tfie rights and reme~ies provided by ls:w by the State of Texas,
the City covenants and agrees particularly that in the event the
City (a) defaults in payment of principal or interest on any.of
the bonds when due, (b) fails to make the payments into the Bond
Fund as required by this ordinance, or (c) defaults in the obser-
vance or performance of any other of the covenants, conditions or
obligations set forth in this ordinance, the holder or holders of
any of the bonds shall be entitled to a writ of mandamus issued by
a court of p~oper jurisdiction compelling and requiring the City
Council and other officers of the City to observe and perform any
covenants, obligations or conditions prescribed in the bond ordin-
ance. No delay or omission to exercise any right or power accruin
upon any default shall impair any such power or right or shall be
construed to be a waiver of any such default: or acquiescence there
in, and every such right and power may be exercised from tine to
time and as often as may be deemed expedient.
The specific remedy herein provided shall be cumulative of
all other existing remedies and the specification of such shall
not be deemed to be exclusive.
SECTION 23: Sale, Lease or
The City of Lubboc urt er covenants, rea inns, ins an o li-
gates itself not to sell, lease or in any manner dispose of the
System, its properties, or any part thereof, including any and all
extensions and additions that may be made thereto, and it acknowl-
edges and accepts res.traint from doing so until the bonds. and
previously issued bonds shall have been paid in full as to both
principal and interest at maturity, or under the provisions hereof
relating to their redemption prior to maturity, or unti other
arrangements have been made for continuance of payment of prin-
cipal and interest then outstanding for the full retirement
thereof; provided, however, that this covenant shall not be ·
construed to prevent· the disposal by the City of property which
in its .judgement has become inexpedient to use in connection with
the System when other property of equal value has been substituted
therefor.
SECTION 24: Further Covenants. The City further covenants,
reaffirms and agrees by and through this ordinance as follows:
(a) That it has the lawful power to pledge the
revenues supporting this issue of bonds and has law-
fully exercised said power under the Constitution and
laws of the State of Texas, including the powers
existing under Articles 1111 through 1118, and Article
2368a, V.A.T.C.S., and that the bonds, the previously
issued bonds and any additional parity bonds issued pur-
suant to the provisions hereof shall be. ratably secured
in such manner that no one bond of any such issues shall
have preference over any other bond of such issues.
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(b) That the net revenues and income of the System
are pledged exclusively to the payment of the bonds, the
previously issued bonds and such additional parity bonds
as may hereafter be issued pursuant to the provisions
hereof; that said net revenues and income have not
been pledged in any manner to the payment of any other
debt or obligation of the City or the System and other-'
wise said System is free and clear of all encumbrances
whatsoever.
(c) That nothing in this ordinance shall require
the City to make any expenditure except from money in the
System Fund, but nothing herein shall prohibit the City
from doing so. at its election.
(d) That e:i.,ccept under the conditions of this ordi-
nance relating to parity bonds. the City will not suffer
any indebtedness on a parity or superior to the bonds of
this issue and the previously issued bonds to accrue to
or against the City or said System, and that if the System
shall become liable for any other indebtedness, the City
Council will fix and maintain rates and collect charges
for the services afforded by the System entirely suffi-
cient to discharge any such indebtedness or obligation •.
(e) The City will cause to be rendered monthly to
each customer receiving electric services a statement
therefor and will not accept payment of le.ss than all of
any statement so rendered, using its powers under existing
ordinances and under all such ordinances to become effective
in the future to enforce payment, to withhold service
from such delinquent customers and to enforce and author-
ize reconnection charges.
( £) That the City will faithfully and punctually
perform all duties with respect to the System required by
the Constitution and laws of the State of Texas, including
the making and collecting of reasonable and sufficient
rates for services supplied by the System, and the segre-
gation and application of the revenues of the System as
required by the provisions of this ordinance.
(g) No free service shall be provided by the System
and to the extent the City of Lubbock or its departments
or agencies utilize the service provided by the System,
payment shall be made therefor at rates charged to others
for similar service.
SECTION 25: Ordinanc:;.e toCortstitu.te Contract. That the
provisions of tnis ordinance shall constitute a contract between
the City of Luboock and the holder or holders from time to time .
of the bonds herein authorized to be issued, and after the issuanc
of any of said bonds, no change, variation or alteration of
any kind of the provisions of this ordinance may be made, unless
as herein otherwise provided, until all of the bonds issued here-
under shall have been paid as to both principal and interest.
SECTION 26: Mayor to Have Charge of Records and Bonas.
That the Mayor of said City shall be, .and he 1.s hereby authorized
to take and have charge of all necessary records and orders pend-
ing investigation by the Attorney General of the State of Texas.
and shall take and have charge and control of the bonds herein
authorized pending their approval by the Attorney General and
their registration by the Comptroller of Public Accounts. It
shall be the duty of the Mayor (or attorneys acting for the City)
to submit the record of said bonds and the bonds to the Attorney
General of the State of Texas for approval and thereafter to have
the bonds registered by the Comptroller of Public Accounts.
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SECTION 27: Bonds are Special Obli~ations. The bonds are
special obligations of the City payablerom the pledged revenues,
and the holders thereof shall never have the right to demand pay-
ment thereof out of funds raised or to be raised by taxation.·
SECTION 28: Bonds as Negotiable Instruments. Each of the
bonds hereLn authorized shall be deemed and construed to be
a "Security," and as such a negotiable instrument, within the
meaning of Article 8 of the Uniform Commercial Code.
SECTION 29: Printed Legal Opinion on Bonds. The purchasers•
obligation toaccept delivery of the bonds herein authorized is
subject to their being furnished a final opinion of Messrs. Dumas.
Huguenin, Boothman and Morrow, Attorneys, Dallas, 'rexas. approving
such bonds as to their validity, said opinion to be dated and
delivered as or the date of delivery and payment for such bonds.
Printing of a true and correct copy of said opinion on the re-
verse side of each of such bonds with appropriate certificate
pertaining thereto exe.cuted by facsimile signature of the City
Secretary is hereBy approved and authorized.
SECTION 30: . "CUSIP Numbers. CUSIP numbers may be printed
on the bonds herein authorized. It is expressly provided, however
that the presence or absence of CUSIP numbers on the bonds shall
be of no significance or effect as regards the legality thereof
and neither the City nor attorneys approving said bonds as to
legality are to be held responsible for CUSIP numbers incorrectly
printed on the bonds.
SECTION 31: No.Arbitrage. That the City hereby covenants
that the proceeds of the bonas are needed at this time to finance
the costs odr capital improvements planned by theCity; based on
current facts, estimates and circumstances, it is reasonably ..
expected final disbursement of the bond proceeds will occur with-
in three years from the date of the receipt thereof by the City;
it is not reasonably expected that the proceeds of the bonds or
moneys deposited in the special Funds referred to .herein for
the payment and security of the bonds will be used or invested
in a manner that would cause the bonds to be "arbitrage bonds"
within the meaning of Section 103(c) of the Internal Revenue Code
of 1954, as amended, or any regulations or published rulings per-
taining thereto; and save and except for the special Funds referre
to herein, no other funds or accounts have been established or •. ·
pledged for tne payment of the bonds. Proper officers of the City
charged with the responsibility in the issuance of the. bonds are
hereby authorized and directed to make, execute and deliver
certifications as· to facts, estimates and circumstances in exis ten e
as of the date of issue of the bonds and stating whether there
are any facts, estimates or circumstances which would materially
change the City's current expectations, and the covenants herein
made and certifications herein authorized are for the benefit of
the holders of the bonds and coupons appertaining thereto and
may be relied upon by the bondholders and bond counsel for the
City.
SECTION 32: The Series 1981 Bonds are being authorized
for the purpose of providing funds for making improvements and
extensions to the City's Electric Light and Power System, i.e.
improvements and extensions to the transmission and distribution
facilities and it is currently anticipated that the proceeds .
thereof will be expended for certain improvements and extensions
to the transmission system and distribution system as follows:
Transmission System
1. Upgrade Cooperative, Vicksburg, and Chalker substations and
extend the 69 KV transmission along 82nd Street to serve Chalker
substation.
2. Extend the second circuit of Lubbock Fower and Lighe s existing
115 KV transmission line from its present termination at 50th Street
and East Loop 289 to Plant #2. Construct a future substation in
Northeast Lubbock along the proposed line route to assume part of
the load when Plant #2 is retired.
3. Upgrade Lubbock Power and Light's present computer capabilities
and install remotes in all major substations to fully coordinate
relaying and line switching and to greatly improve Lubbock Power
and Light's emergency response capabilities.
Distribution System
Extensions of and improvements to the existing distribution system
including additional distribution c.ircuits for substations, exten-
sions from existing line terminals to new areas of service, trans-
formers, meter pedestals, poles, and crossarms, r~gulators,
capacitors, meters, service lines and other appurtenances.
It is currently anticipated that all of the foregoing improve.,-
ments may be constructed with the rroceeds to be available from
the sale of the Bonds, the City, however, reserves the right to
utilize the proceeds of the Bonds to construct all or any part
of the proposed improvements or to construct othe~ or additional
improvements for improvements and extensions to the transmission
and distribution systems in the event .there are s~fficient proceeds
or in the event a delay in the delivery of the Bo*ds requires the
utilization of current funds for such system impr9vements.
SECTION 33: Effective Date. This ordinance shall take
effect and be in force immediately from and after'its passage.
on second and final reading and IT IS SO ORDAINED,
PASSED AND APPROVED ON FIRST READING, this ·14th day of
May, 1981.
PASSED AND APPR.OVED ON SECOND READING, this .. 15th day of May,'1981 . --
~~ Ma~Tub ock, Texas
(City Seal)