HomeMy WebLinkAboutO-1962-641
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AN ORDINANCE AUTHORIZING THE ISSUANCE OF $328,000
viA TER\10RKS AND SE\1ER SYSTEM REVENUE REFUNDING
BONDS; PRESCRIBING THE TERMS AND PROVISIONS THERE-
OF; MAKING PROVISION FOR THE PAYMENT OF THE PRIN-
CIPAL THEREOF AND INTEREST THEREON; PROVIDING FOR
THE EXCHANGE THEREOF FOR THE UNDERLYING BONDS BEING
REFUNDED THEREBY; CONTAINING OTHER PROVISIONS RE-
LATING TO THE SUBJECT j AND PROVIDING THAT THIS
ORDINANCE SHALL BE EFFECTIVE UPON AND AFTER ITS
ADOPTION
THE STATE OF TEXAS ~
COUNTY OF HARRIS ~
,.............-____..,.'. The City Commission of the City of La Porte, Texas, con-
. vened in regular session at the City Hall within said City on the
6th day of April, 1962, with the following members present, to-wit:
H. P. Pfeiffer
Mayor
vI. A. S ta b ~ , Jr.
Commissioner and
Mayor Pro Tern
Tom W. Osburn
Commissioner
Odell L. Brown
Commissioner
Dennis Dunham.
Conunissioner
Frank G. Baker
City Clerk
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~ when, among other business had, the following was transacted:
The Mayor introduced an ordinance which was read in full.
Commissioner fPs b Vf?...tt,/ made a motion that the ordinance be
adopted as read. Commissioner !3ffott/v seconded the motion
for adoption of the ordinance. The motion, carrying with it the
adoption of the ordinance, prevailed by the following vote:
AYES: Commissi.oners Stabs, Osburn, Brown,
Dunham, and Mayor Pfeiffer.
NOES: None.
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The Mayor thereupon announced that the motion had duly
and lawfully carried, and that the ordinance had been duly and
lawfully adopted. The ordlnance thus adopted follows:
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AN ORDINANCE AUTHORIZING THE ISSUANCE OF $328,000
WATERWORKS AND SEWER SYSTEM REVENUE REFUNDING
BONDS; PRESCRIBING THE TERMS AND PROVISIONS THERE~
OF; MAKING PROVISION FOR THE PAYMENT OF THE PRIN-
CIPAL THEREOF AND INTEREST THEREON j PROVIDING FOR
THE EXCHANGE THEREOF FOR THE UNDERLYING BONDS BEING
REFUNDED THEREBY; CONTAINING OTHER PROVISIONS RE-
LATING TO THE SUBJECT; AND PROVIDING THAT THIS
ORDINANCE SHALL BE EFFECTIVE UPON AND AFTER ITS
ADOPTION
WHEREAS, the following revenue bonds of the City of
La Porte, Texas, payable from the net revenue.s of the waterworks
and sanitary sewer system, are outstanding and unpaid, and consti-
tute valid and binding spe~ial obligations of said City (said
bonds constituting all the outstanding indebtedness payable from
said net revenues)~
(1) WATERWORKS AND SEWER SYSTEM REVENUE BONDS"
SERIES 1948, dated March 15, 1948, Bonds
Nos. 89 to 157, both inclusive. 163 to
168, both inclusive, and 174 to 250, both
1.nc1usive, j.!1 'the denomination of $1.000
each, aggregating $152,000, (Bonds Nos.
158/162 and 169/173 having oeen paid prior to
maturity and having been canceled), bearing
interest per annum at the following rates:
3-3/4% (Nos. 89/151) and 3-1/2% (Nos. 152/1.57,
163/168, and 1.74/250), and maturing serially
on March 15th in each of the years 1963 to
1.977, said bonds having been registered by
the Comptroller of Public Accounts of the
State of Texas under Reg. No. 24828;
(2) WATERWORKS AND SEWER SYSTEM REVENUE BONDS"
SERIES 1949, dated March 15, 1.949, Bonds
Nos. 28 to 100, both inclusive, in the de-
nomination of $1,000 each, aggregating $73,000,
bearing interest at the rate of 4% per annum,
and maturing serially on March 15th in each
of the years 1963 to 1978, both inclusive,
said bonds having been registered by. the Comp-
t~oller of Public Accounts of the State of
Texas under Reg. Nos. 25979 and 2634~;
(3) WA TERWORKS AND SEWER SYSTEM REVENUE BONDS,
SERIES 1950, dated March 15, 1950, Bonds Nos.
34 to 100, both inclusive, in 'the denomination
of $1,000 each, a.ggr'egF.i.ting $67,000, bearing
interest per a.nnum at the following rates:
2~1/2% (Nos. 34/40) and 2-3/4% (Nos. 41/100),
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and maturing serially on March 15th in each
of the years '1963 to 1978, both inclusive,
said bonds hav1,ng been registered by the
Comptroller of Public Accounts of the state
of Texas under Reg. No. 26972; and
(4)
viA TERWORKS AND SEWER SYSTEM REVENUE BONDS,
SERIES 1951, d9. ted March .15, 1951, Bonds Nos.
15 to 50, both inclusive, in the denomination
of $1,000 each, aggregating $36,000, bearing
interest at the r9.te of 3-1/2% per annum.,
and maturing serially on March 15th in each
of the years 1963 to 1978, both inclusive,
said bonds having been registered by the Comp-
troller of Public Accounts of the state of
Texas under Reg. No. 27581;
and
WHEREAS, the owners and holders of sa.id outstanding reve-
nue bonds have consented to the refunding thereof into revenue re-
funding bonds, as hereafter provided in this ordinancej and
WHEREAS, the City Commission of said City has determined,
and hereby affirmatively determines and declares, that it would be
to the best interests of the City for such outstanding bonds to be
so refundedj and
WHEREAS, the City Commission wishes to proceed with the
issuance of said revenue refunding bonds; Therefore
BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF
LA PORTE:
Section l~
AMOUNT 3 NAME.I> PURPOSE 3 AND A UTHORIZA TION OF REVENUE BONDS: Tha t
the coupon revenue bonds of the C1.t,y of I.a Porte, Texas, be issued
in the principal amount of $328,000, to be Known and designated as
"CITY OF LA PORTE, TEXAS, WATERWORKS AND SEWER SYSTEM REVENUE
REFUNDING BONDS,? SERIES 19621~, for the purpose of refunding, can-
~--, celing, and in lieu of a like principa.l amount of waterworks and
~ sanitary sewer system revenue bonds of said City (being the
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$328,000 outstanding .revenu.e bonds deftcribed in the preamble to
this ordinance), under and oy virtue of and iT.:'. strict conformity
wi th the Consti tutlon a.nd .la.Ws of the Sta te of Texs.s, particularly
Articles 1111 to 1118, CO'Vl in.clusive, and Article 236850, Ver-non;s
Texas Civil Sta.tutes, aft amended, and the Home RU..le Cha.rter of
said City.
Section 2~
DATE, NUMBERS, DENOMlmi:.TIONSs AND MATURITIES ~ T,h.03.t said revenue
refunding bonds shall. be da.ted Ma'l"Ch 15, 1962, Sh:;"l..l b~ numbered
consecutively from 1 to 68, both inclu.sive, sh.~.~.J be in. t.l1.e fol1ow-
ing denominations, re spe('" i ve.ly ~
Bonds Nos. 1, 2, A.nd 3 snal J be in t.rle denomina-.
tion of $1,000 ea(;h r.aggregating $3,000:1, and
Bonds Nos. 4 T..,':'l 68, bot.h inc.lustve, snall be in
the denomirat:ion of $.5,000 ea h (,aggregating
$325,000) ,
aggregating $328,000., a.nd s.r~all becom.e du,e a.nd payable serially in
their numerical order, w.i thou! opt ion of prlOl~ redemption, on
March 15th in each of the yea.:rs 196.3 to .l9?9, both inclusive, in
the respective amounts Sh0W!1 J.11 the following scneduJ.e:
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Bond Numbers Year of Amount
(bot.h incl. ':"... ~~~E!!:X Maturing
1. - 4 1963 $ 8,000
.5 -' 7 1964 15., 000
8 - 10 1965 15>000
11 " 1.3 ~966 :5,000
'14 J.6 1.967 15,000
17 - 1.9 iQE8 ..15.000
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20 - 2;:> ]969 .1.-5. 000
23 - 26 L9?'O 20.000
27 - 3C 1 9'! .l. 20,OOC
31 ... 3.5 ~.9? '2 25,~OO
36 - 4c ]973 25,000
41 - 45 1974 '2.5,000
46 5C 19?5 25.000
51 55 .1976 25>000
:>6 - 60 19,!7 25,OCO
61 - 61; ,1.9?8 25,000
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66 68 -:"979 15, 000
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Section 3:
3.01 - INTEREST RATES AND INTEREST PAYMENT DATES: That said bonds
shall bear interest per annum, represented by interest coupons
attached to such bonds, at the following rates, respectively, to-
wit:
Bonds Nos. 1 to 4, both inclusive, 2-1/2%,
Bonds Nos. 5 to 16, both inclusive, 2-3/4%,
Bonds Nos. 17 to 26, both inclusive, 3-1/2%,
~ Bonds Nos. 27 to 40, both inclus1.ve, 4%,
. Bonds Nos. 41 to 55, both inclusive, 3-1/2%, and
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Bonds Nos. 56 to 68, both inclusive, 3-3/4%,
interest payable September 15, 1962, and semi-annually thereafter
on March 15th and September 15th of each year until the principal
sum is paid.
3.02 - MODE OF PAYMENT AND BANK OF PAYMENT: That both principal of
and interest on said bonds shall be payable in any coin or currency
which, on the respective dates of payment of such principal and in-
."'---- terest, 1s legal tender for payment of debts due the United States
~ of America, at The First City National Bank of Houston, Houston,
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Texas, without exchange or collection charges to the owners of the
bonds and/or interest coupons. The principal of said bonds shall
be payable only upon presentation and surrender of said bonds as
they respectively become due, and interest falling due on and
prior to the respective maturity dates of the bonds shall be payable
only upon presentation and surrender of the interest coupons at-
tached to said bonds as such coupons severally become due.
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Section 4:
. EXECUTION OF BONDS AND INTEREST COUPONS ~ That each of the bonds
shall be signed by the Mayor and countersigned by the City Clerk
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of the City of La Porte, Texas, by their lithographed or printed
facsimile signaturesJ and the facsimile of the corporate seal of
said City shall be lithographed or printed on each of said bonds.
The interest coupons attached to said bonds shall also be executed
by said facsimile signatures of the Mayor and City Clerk. Said
facsimile signatures on the bonds and interest coupons and said
facsimile seal on the bonds shall have the same effect as if said
bonds and coupons had been signed in person and manually by each
of such officers and the corporate seal of the City had been manu-
ally impressed upon each of said bonds. The registration certifi-
cate of the Comptroller of Public Accounts, which certificate is
to be printed on the back of each of said bonds as provided here-
after in Section 7 of this ordinanceJ shall be manually executed.
Section 5:
FORM OF BONDS: That said bonds shall be in substantially the fol-
lowing form:
No.
$
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF HARRIS
CITY OF LA PORTE, TEXAS, WATERWORKS
AND SEWER SYSTEM REVENUE REFUNDING BOND
SERIES 1962
THE CITY OF LA PORTE, in the County of HarrisJ in the
State of TexasJ FOR VALUE RECEIVEDJ hereby acknowledges itself in-
debted to and PROMISES TO PAY TO BEARER ON THE 15TH DAY OF MARCH,
19___J solely from the special fund hereinafter specified, the sum
of
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THOUSAND DOLLARS
($
)J and to pay interest thereon from the date hereof at the
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% (NOTE TO PRINTER: For in.terest rates, see Section
rate of
3.01 of bond ordinance) per annum, interest payable September 15,
1962, and semi-annually thereafter on March 15th and September 15th
of each year until the principal sum hereof shall have been paid.
Both principal of and interest on this bond are payable in any
coin or currency which on the respective dates of payment of such
principal and interest is le~al tender for the payment of debts
due the United States of America, at The First City National Bank
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of Houston, Houston, Texas, without exchange or coll~ction charges
. to the owner or holder. The principal hereof shall be payable only
upon presentation and surrender of this bond, and interest hereon
falling due on and prior to the maturity of this bond shall be pay-
able only upon presentation and surrender of the interest coupons
hereto attached as such coupons severa.lly become due.
THE DATE OF THIS BOND, in conformity with the ordinance
hereinafter mentioned, IS MARCH 15, 1962.
THIS BOND IS ONE OF A SERIES OF 68 SERIAL BONDS of like
,~. date and tenor, except as to serial number, denomination, interest
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4It rate, and maturity, being numbered consecutively from 1 to 68, both
inclusive, in the following denominations, respectively: $1,000
(Bonds Nos. 1/3) and $5,000 (Bonds Nos. 4/68), AGGREGATING $328,000,
and, together with the other bonds of said series, is issued for
the purpose of refunding, canceling, and in lieu of a like princi-
pal amount of outstanding waterworks and sanitary sewer system reve-
nue bonds of said City, under and by virtue of and in strict con-
formity with the Constitution and laws of the State of Texas,
particularly Articles 1111 to 1118, both inclusive, and Article
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2368a, Vernon's Texas Civil Statutes, as amended, and the Home Rule
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~ Charter of said City, and pursuant to an ordinance lawfully passed
and adopted by the City Commission 0f said City and duly recorded
in the official minutes of sai,d City Commission, to all the pro-
visions of which ordinance the owner or holder of this bond and of
the interest coupons appurtenant hereto, by the acceptance thereof,
expressly assents.
EACH SUCCESSIVE HOLDER OF THIS BOND and each successive
holder of each of the interest coupons hereto attached is conclu-
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sively presumed to forego and renounce his equities in favor of sub-
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sequent holders for value and withou.t notice, and to agree that this
bond and each of the coupons hereto attached may be negotiated by
delivery by any person having possession thereof, howsoever such
possession may have been acquired, and that any holder who shall
have taken this bond OI' any of the coupons from any person for
value and without notice thereby has acquired absolute title there-
to, free from a.ny defenses enforceable against any prior holder
and free from all equities and claims of ownership of any such
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prior hOlder. The City of La Porte and its officials and fiscal
.~ agents Shall not be affected by any notice to the contrary.
THIS BOND SHALL NOT BE DEEMED TO CONSTITUTE A DEBT of.
the City of La Porte or. a pledge of its faith and credit, but shall
be payable, as to principal and interest, solely from the revenues
derived from tbe opera.tion of the waterworks a.nd sanitary sewer
system of said City, including all additions, extensions, replace-
ments, and improvements t!'.eret'J It,Thi.ch may hereafter be made, after
deduction of the reasona,ble expe~ses of maintenance and operation
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of said system. The holder hereof sr.~ll never have the right to
. demand payment of thi S ob l.iga '!.1on '-;u."t of' 3.ny funds raised or to be
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~ raised by taxation.
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THE CITY EXPRESSLY RESERVES THE RIGHT TO ISSUE ADDITIONAL
BONDS payable from the net revenues of said wa ter.works and sanitary
sewer system, and such additional bonds may be on a parity in all
respects with the bonds of this issue, but such additional parity
bonds may be issued only pursuant to and subject to the restrictions,
covenants, and limitations contained in the ordinance authorizing
this issue of bonds, to which reference is hereby made for all
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~ Except as may be provided by the aforesaid ordina,nce, THE
HOLDER OF THIS BOND AND THE HOLDERS OF THE OTHER BONDS OF THE
SERIES OF WHICH THIS BOND IS A PART ARE AND SHALL BE SUBROGATED to
all the rights and privileges belonging to the holder or holders
of the bonds which have been refunded by the issuance of this series
of bonds.
IT IS HEREBY CERTIFIED" RECITED" AND REPRESENTED that the
issuance of this bond and the other bonds of the series of which
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this bond is a part is duly authorized by law; that all acts, con-
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ditions, and things required to exist and to be done precedent to
and in the issuance of this series of bonds to render the same law-
ful and valid have been properly done and performed and have hap-
pened in regular and due time, form, and manner, as required by law;
that due prOVision has been made for the payment of the principal
of and interest on this bond and the other bonds of the series
of which it is a part by irrevocably pledging the net revenues of
said waterworks and sanitary sewer system; and that the issuance
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of this series of bonds does not exceed any Constitutional or statu-
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tory limitation.
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IN TESTIMONY WHEREOF, the City Commission of the City of
fa Porte, Texas, has caused the facsimile of the corporate seal of
said City to be lithographed or printed hereon, this bond to be
signed by the Mayor of said City and countersigned by the City
Clerk 'by their lithographed or printed facsimile signatures, and
the interest coupons hereto attuchcd also ~G be ex~cut~d ~y said
facsimile signatures of the Ma.yor and City Clerk, all as of the
15th day of March, 1962.
~ COUNTERSIGNED:
Mayor, City of fa Porte, Texas
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City Clerk
Section 6:
FORM OF INTEREST COUPONS: That the interest coupons to be attached
to said bonds shall be in substantially the following form:
No.
$
ON THE 15TH DAY OF
, 19___, THE CITY OF
LA PORTE, in the County of Harris, State of Texas, PROMISES TO PAY
TO BEARER, without exchange or collection charges, at The First
City National Bank of Houston, Houston, Texas, THE SUM OF $
in lawful money of the United States of America, solely from the
special fund specified in the bond to which this coupon appertains,
said sum 'being interest due that date on City of fa Porte, Texas,
Waterworks and Sewer System Revenue Refunding Bond, Series 1962,
bearing the number hereinafter specified, dated March 15, 1962.
The holder hereof shall never have the right to demand payment of
this obligation out of any funds raised or to be raised by taxation.
Bond No.
Mayor, -City of fa Porte, Texas
City Clerk
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Section 7:
REGISTRATION OF BONDS BY STATE COMPTROLLER AND FORM OF REGISTRATION
CERTIFICATE: That each of said bonds shall be registered in the
office of the Comptroller of Public Accounts of the State of Texas,
as provided by law, and the registration certificate of said
Comptroller of Public Accounts, which certificate is to be printed
on the back of each of said bonds and is to be manually executed,
shall be in substantially ~he following form:
OFFICE OF THE COMPTROLLER
REGISTER NO.
THE STATE OF TEXAS
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 re-
quired by law, and that he finds that it has been issued in con-
formity with the Constitution and laws of the State of Texas, and
is a valid and binding special obligation of the City of La Porte,
Texas, payable from the revenues pledged to its payment by and in
the ordinance authorizing the samej and said bond has this day
been registered by me.
WITNESS MY HAND AND SEAL OF OFFICE at Austin, Texas,
Comptroller of Public Accounts
of the State of Texas
Section 8:
DEFINITIONS: That, as used in this ordinance, the following words
and terms shall mean and include, and are defined, as follows, to-
wit:
(a) City - the City of La Porte, Texas, and, where
.~ appropriate, the City Commission thereof.
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(b) System -. the waterworks and sanitary sewer system
of the City, including all present and future additions, extensions,
replacements, and improvements to said waterworks and sanitary
sewer system.
(c) Net revenues - the gross revenues derived from the
operation of the System less the reasonable expense of operation
and maintenance of said System, including all salaries, labor,
materials, interest, and such repairs and extensions as in the judg-
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ment of the governing body of the City are necessary to keep the
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City and the inhabitants thereof, or such as might be necessary to
meet some physical accident or condition which would otherwise im-
pair the original security.
(d) Bonds - the $'~28,ooo City of La. Porte, Texas, Water-
works and Sewer System Revenue Refunding Bonds, Series 1962, dated
March 15, 1962, authorized by this ordinance.
(e) Underlying Bonds - the $328,000 outstanding revenue
..".------ "'0. bonds which are being refunded by the issuance of the Bonds, said
4It outstanding bonds being more particularly described in the pre-
amble to this ordinance.
(f) Additional Bonds - the additional parity revenue
bonds that the City expressly reserves the right to issue in Section
10.06 of this ordinance.
Section 9:
SECURITY FOR BONDS AND ADDITIONAL BONDS: That the Bonds (and, when
issued, the A~ditional Bond~) are payable from and secured by a
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first lien on and pledge of the revenues of the System after deduc-
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tion therefrom of the reasonable expense of operation and maintenance
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~ of said System. The Bonds and the Additional Bonds, when issued,
will be in all respects on a parity and of equal dignity with one
another.
Section 10:
PLEDGE OF NET REVENUES: That all of the net revenues from the op~~a-
tion of the System, with the exception of those in excess of the
amounts required to establish and maintain the funds as hereinafter
provided, are hereby irrevocably pledged to the payment of the Bonds,
//---... and, when issued, tne Additional Bonds, SUbject to the terms and
. 'provisions of this ordinance. For the benefit "of the original holder
or holders of the Bonds and for the benefit of any and all subsequent
holders of said Bonds, interest coupoqs, or any part thereof, and
in addition to all other provisions and covenants and the laws of
the State of Texas and in this ordinance, it is expressly ~tipulated:
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10.01 - RATES: The City shall fix and maintain rates and collect
cl.arges for the facil:i.t1.es and services. afforded by the System which
will provi.de revenues sufficient at all times:
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(a) To pay for all operation, mainte~nce, .depreciation,
~ replacement, and betterment charges of the Systemj
(b) To produce net :r~venues each year in an amount not
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less than one and one-half (l~l/~) times the average annual princi-
pal and interest requirements of all bonds then outstanding payable
from the revenues of the Systemj
(c) To establish and maintain the Bond Fund, the Reserve
Fund, and the Contingency Fund, as provided in this ordinance and
any ordinances authorizing the issuance of Additional Bonds.
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(d) To pay all outstanding indebtedness against the System,
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other than the Bonds and Additional Bonds, as and when the same
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~ become due. Provided, also, that no free service or services of the
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System shall be allowed, and should the City or any of its agencies
or instrumentalities make use of the services, and facilities of the
System, payment of a reasonable value thereof shall be made by the
City out of funds derived from sources other than revenues and .in-
come of the System.
10.02 - USE OF REVENUES: The City will deposit, as collected, all
revenues derived from the operation of the System into a separate
account (herein called the "System Fund"), which shall be kept
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separate andapaI1t from all other funds of the City. The System Fund
shall be administered as follows:
(a) Maintenance and Operation: From the moneys in the
System Fund, the City shall pay the expenses of operation and rnain-
tenance, including all salaries, labor, materials, interest, and
such repairs and extensions, as in the judgment of the governing
body of the City, are necessary to keep the plant or utility in
operation and render adequate service to such City and the in-
habitants thereof, or such as might be necessary to meet some
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physical accident or condition which would otherwise impair the
original security.
(b) Bond Fund: There is hereby created and established
a special ~und ~or the payment o~ the principal o~ and interest on
the Bonds, to be known as CITY OF LA PORTE WATERWORKS AND SEWER
SYSTEM REVENUE BOND INTEREST AND SINKING FUND, hereinafter referred
to as the "Bond Fund." After the payment of all expenses provided
for in the next preceding paragraph, the City, on or before the
lOth day of each month, beginning with the month of April, 1962, and
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continuing until all the Bonds have been finally paid, both as to
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4It principal and interest, shall, from moneys in the System Fund, pay
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into the Bond Fund the following amounts:
(1) On or before April 10, 1962, and on or before
the lOth day of each month thereafter to and
including the month of June, 1970, an amount
which is. not less than $2,050 per month;
(2)- On or before July 10, 1970, and on or before
the lOth day of each month thereafter to and
including the month of June, 1973, an amount
which is not less than $2,500 per month; and
(3) On or before July 10, 1973, and on or before
the lOth day of each month thereafter until
all the Bonds have been finally paid, both as
to principal and interest, an amount which is
not less than $2,300 per month.
If in any month the City shall, for any reason, fail to pay into
said Bond Fund the full amounts above stipulated, amounts equivalent
to such deficiency or deficiencies shall be set apart and paid into
said Bond Fund from the first available and unallocated revenues
as of the following month or months and shall be in addition to the
amounts hereinabove provided to be otherwise paid into said Bond Fund
each month. The moneys paid into the Bond Fund shall be deposited
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in the official depository of the City, and shall be continuously
secured by a valid pledge to the City of direct obligations of the
United States of America, haVing an aggregate market value, exclusive
of accrued interest, at all times equal to such Bond Fund. The
amount received from the purchasers of the Bonds as accrued inter-
est thereon to the date of delivery shall also be placed in the Bond
Fund, which shall reduce by such amount the sums which would other-
wise be required to be placed into the Bond Fund from the revenues
of the System.
(c) Reserve Fund: There is hereby created and estab-
'" lished a special. fund as a reserve for the Bonds, to be known as
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CITY OF LA PORTE WATERWORKS AND SEWER SYSTEM REVENUE BOND RESERVE
FUND" hereinafter referred to as the "Reserve Fund." After the pay-
ments required by the two next preceding paragraphs have been made"
the City" on or before the 10th day of each month" beginning with
the month of April" 1962" shall, from moneys in the System Fund,
pay into the Reserve Fund an amount which is not less than $250 per
month" and such monthly payments shall be continued until such time
as there is in the Reserve Fund an amount not less than $24,750.
If in any month the City shall" for any reason" fail to pay into
the Reserve Fund the full amount above stipulated, amounts equivalent
to such deficiency or deficiencies shall be set apart and paid into
the Reserve Fund from the first available and unallocated revenues
of the following month or months and shall be in addition to the
monthly deposit hereinabove provided to be otherwise paid into said
Reserve Fund. The moneys paid into the Reserve Fund shall be deposited
in the official depository of the City ar~ shall be continuously
secured by a valid pledge to the City of direct obligations of the
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United States of America" having an aggregate market value" exclusive
of accrued interest, at all times at least equal to such Reserve
Fund. The moneys in the Reserve Fund" at the option of the City"
may be invested in direct obligations of the United States of America,
maturing within 10 years from the date of purchase or maturing before
the final maturity of the Bonds, whichever shall first occur" which
shall be deposited in escrow with the local depository under an
escrow agreement. If such moneys are so invested and deposited
in escrow, then City shall have the right to have sold through the
escrow agent on the open market" a sufficient amount of such securi-.
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ties to meet its obligations of principal and interest in the event
it does not have sufficient uninvested funds on hand for such purpose.
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~ Under such circumstances, the Mayor is hereby authorized, ordered,
and directed to give fifteen (15) days' written notice to such
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escrow agent of the necessity to sell such securities on the open
market. After said sale, the moneys resulting therefrom shall
belong to the Reserve Fund and shall be available to pay such obliga-
tions of principal and interest as above provided. So long as the
Reserve Fund contains a balance of not less than $24,750, no further
payments need be made into said Reserve Fundj however, in the event
that .said balance is ever reduced to an amount less than $24,750,
the monthly payments, as provided above, shall be continued and re-
surned until said balance of not less than $24,750 is again leached
and maintained.
(d) Contingency Fund: There is hereby created and estab-
lished a special fund for contingencies, .to be known as CITY OF
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LA PORTE WATERWORKS AND SEWER SYSTEM REVENUE BOND CONTINGENCY FUND,
hereinafter referred to as the "Contingency Fund." After the payments
required by the next three preceding paragraphs have been made, the
City, on or before the lOth day of each month, beginning with the
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month of April, 1962, shall, from moneys in the System Fund, pay
into the Contingency Fund an amount which is not less than $200 per
month, and such monthly payments shall be continued until such time
as there is in the Contingency Fund an amount not less than $25,000.
Moneys in the Contingency Fund may be used only (1) to pay unusual
maintenance and operation expenses of the System for the payment of
which no other funds are av~ilB:-ble, and (2) to prevent a default in
the payment of the principal of and/or interest on the Bonds in the
event there are insufficient moneys in the Bond Fund and Reserve
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Fund to make such payments.
If in any month the City shall, for any
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~ reason, fail to pay into the Contingency Fund the full amount. above
stipulated, amounts equivalent to such deficiency or deficiencies
shall be set apart and paid into said Contingency Fund from the
-first available and unallocated revenues of the following month
or months and shall be in addition to the monthly deposit herein-
above provided to be paid otherwise into said Contingency Fund.
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The moneys pa~d into the Contingency Fund shal.l be deposited in
the official depository of the City, and shall be continuously
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secured by a valid pledge to the City of direct obligations of the
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United states of America, having an aggregate market value, exclu-
sive of accrued interest, at all times at least equal to such
Contingency Fund. ,Money's in the Contingency Fund may be invested
as is provided in the next preceding paragraph with respect to
moneys in the Reserve Fund, and if such moneys are so invested in
securities (as provided in said next preceding paragraph) moneys
resulting from the sale thereof' shall belong to the Contingency
Fund and shall be available for the two purposes specified above.
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When a balance of not less than $25,000 is reached in the Contin-
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gency fund, no further payments need to be made into said Fundj
however, in the event that said balance is ever reduced to an amount
less than $25,000, the monthly payments, as provided above, shall
be resume~ and continued until said balance of $25,000 is again
reached and maintained.
(e) Trust Funds: Moneys in the Bond Fund, in the Reserve
Fund, and in the Contingency Fund shall constitute trust funds, and
shall be used solely fpr the aforesaid purposes until all of the
Bonds have been retired, both as to principal and interest. The
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appropriate officials of the City shall assure that moneys are
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4It transferred from the Bond Fund (and, if necessary, from the Reserve
Fund and the Contingency Fund) to the bank of payment at the proper
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times so that funds will be available for the payment of the inter-
est on and principal of the Bonds as such interest and principal
respectively become due and payable. When there are moneys in the
Bond Fund and Reserve Fund sufficient to make all interest pay-
ments and all principal payments due and to become due to the
final maturity of all bonds then outstanding payable from the reve-
nues of the System, no further payments need to be made int,o said
Bond Fund, Reserve Fund, and Contingency Fund.
(f) Surplus: Any funds remaining in the System Fund
after provision has been made for the payment of the reasopable
cost of operating and maintaining the System, and for the payments
into Bond Fund, Reserve Fund, and Contingency Fund, as above pro-
vided, and after provision has been made for all payments that may
be required by ordinances or proceedings pertaining to Additional
Bonds, may be used by the City for the retirement of Bonds or
Additional Bonds, or may be used for any other purpose or purposes
permitted by law.
10.03 - MAINTENANCE AND OPERATION: The City shall maintain the
System in good condition and operate the same in an effioient man-
ner and at a reasonable cost~ So long as any of the Bonds are out-
standing, the City agrees to maintain ins~rance, for the benefit
of the holder or holders of said Bonds, on the System of a kind
and in an amount which would usually be carri~d by private companies
engaged in a similar type of business. Nothing in this ordinance
shall be construed as requiring the City to expend any funds for
this purpose which are derived from sources other than the operation
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.~ of the System, but nothing herein shall be construed as preventing
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the City from doing so.
10.04 - ACCOUNTS~. FISCAL YEAR, AND ACCOUNTING REPORTS: The City
shall keep proper records and accounts (separate from all other
records and accounts of the City) in which complete and correct
entries shall be made of all transactions relating to the System.
The City will operate the System on the basis of a fiscal year
ending June 30thj provided, however, that if the Home Rule Charter
of said City is hereafter changed or amended to provide a differ-
ent fiscal year, said fiscal year ending June 30th shall be
changed to the fiscal year as provided or specified in said
Charter as so changed or amended. Not later than 90 days after
the close of each fiscal year, the City will furnis~, without cost,
to:
Moroney, Beissner & Co., Inc.
Houston, Texasj
Municipal Advisory Council of Texas
Austin, Texasj
Moody's Investors Service
New York, New Yorkj
Standard & PoorBs Corporation
New York, New Yorkj and
Any holder of any Bond or Bonds
who may so request in writing
a signed or certified copy of a report of an independent certified
public accountant or firm of certif~ed public accountants, covering
the next preceding fiscal year, showing the following information
relating to the System:
(a) Income and expense statementj
(b) Balance sheetj
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(c) Accountan't i, s comment regarding the manner in which
the City has comp~ied with the requirements of this ordinance, and
his recommendation for any change or improvements in the operation
of the Systemj
(d) List of insUrance pOlicies in force a~ the end of
the fiscal year, showing as'to each policy, the risk covered, the
name of the insu~er, and the expiratio~ date.
(e) ~he number of pr9perties connected with the System
and the total income f~om the Rystem for the yearj
(f) ~he number of unmetered customers of the System at
the end of said fi~.cal year, .if any j
(g) The. number of gallo~s of water pumped into or taken
by the System and the number of gallons of water sold by tpe
System during said fiscal year.
10.05 - INSPECTIONS: Any original holder of 25% or more in princi-
pal amount of the Bonds, and any holder of 25% or more in principal
amount of the Bonds then outstanding shall have the right at any
reasonable time to inspect the System and all records, accounts,
and data of ~he City relating thereto.
10.06 - ADDITIONAL PARITY REVENUE BONDS: In addition to inferior
lien bonds authorized by Chapters 249 and 250, Acts of the 51st
Legislature of Texas, 1949, as amended, the City reserves the right
to issue additional parity bonds in one or more installments, and
such Additional Bonds, when issued, may be secured by and payable
from a first lien on and pledge of the net revenues of the System
in the same manner and to the extent as are the Bonds and the re-
ma1n1ng voted bonds, and such Additional Bonds may in all respects
../---... be of equal dignity with the Bonds and remaining voted bonds. No
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Additional Bonds, however, shall be issued unless:
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(a) Each of the funds created by this ordinance or by
any ordinance or ordinances authorizing previously :i,ssued Additional
Bonds, contains the amount of money then required to be on deposit
therein under the provisions of said ordinance or ordinances;
(b) The net revenues of the System for the then last
preced:ing fisca.l year, as certified by an independent certified
public accountant or firm of certified public accountants, were
equal to at least one and one-half (1-1/2) times the requirements
for the payment of principal of and interest on all bonds that will
be outstanding and payable from the revenues of the System after
the Additional Bonds then proposed to be issued are issued and sold
and delivered, for the calendar year in which said requirements are
greatestj
(c) Provision is made in the ordinance or ordinances
authorizing said Additional Bonds for payments or deposits into the
Reserve Fund until a balance is reached (in addition to deposits
into said Fund required by other ordinances or proceedings relating
thereto and in addition to any balance or balances required by said
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other ordinances or proceedings) of not less than the average annual
principal and interest requirements of the Additional Bonds then pro-
posed to be issued and which balance shall be reached within five
years rrom the date of said Additional Bondsj
(d) Said Additional Bonds are made to mature on March
15th in each of the years in which they are scheduled to mature.
The term "net revenues" as used herein shall mean all of
the net revenues of the System (excluding income received specific-
ally for capital items) after deduction of the reasonable expenses
of operation and maintenance of the System (excluding expenditures
for capital items).
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4It Section ll~
SYSTEM OF RECORDS AND ACCOUNTS ~ Tba t the Mayor, City Clerk, and
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City TreasureI' are hereby instructed and directed to do any and
all things necessary in reference to the installing and maintaining
of a complete system of records and accounts pertaining to said
System and to make the moneys available for the payment of the Bonds
in the manner provided by law.
Section 12:
SPECIAL COVENANTS~
That the City covenants, by and through this
ordinance, as follows:
12.01 - POWER TO PLEDGE REVENUES: That it has lawful power to pledge
the revenues supporting this issue of Bonds and has lawfully exer-
cised its power under the Constitution and laws of the State of
Texas, including said power e~iBting under A~ticles 1111 to 1118,
both inclusive, Vernonos Texas Civil Statutes, as amendedj and that
the Bonds issued hereunder. shall be ratably secured under said
pledge of net revenues and in such manner that one Bond shall have
no preference over any other Bond of said issue.
12 .02 - ~VENUES NOT ENCUMBERED ~ Tha t, other than the Underlying
Bonds which are being refunded by the issuance of the Bonds, the
rents, revenues, properties, and income of said System are not in
any manner pledged to the payment or any debt or obligation of the
City, nor of said System.
12.03 ~ SALE OR ENCUMBRANCE OF SYSTEM AND ISSUANCE OF ADDITIONAL
PARITY BONDS~ That, so 10I'l..g as any of the Bonds authorized herein
remain outstanding, the City will not sell or encumber the System,
or any substa~tial part the~e9~J and that, with the exception of
the Additiop~l Bonds mentioned in Section 10.06 hereof, when issued
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in accordance with all the terms and conditions of this ordinance, it
will not encumber the revenues of the System unless such encumbrance
is made junior and subordinate to the Bonds and to all the provisions
of this ordinance. Provided, however, that the Bonds and the Addi-
tional Bonds may be refunded with the consent of the holders thereof
(except that as to Bonds which have matured by normal maturity and
Additio~~l Bonds which have matured either by normal maturity or
through the exercise of prior redemption provisions, if any, con-
tained in such Additional Bonds, such consent shall not be necessary),
and the refunding bonds so issued shall enjoy complete equality of
lien with the portion of the outstanding bonds which is not refunded,
if any there be, and the refunding bonds shall continue to enjoy the
priority of lien that may have been enjoyed by the bonds refunded;
provided, if only a portion of the bonds then outstanding is so re-
funded and if the refunding bonds are issued in such manner that the
interest rate is increased or that any refunding bond matures earlier
than any of the outstanding bonds which are not refunded, then such
refunding bonds may be issued only if the terms and conditions set
forth in Section 10.06 with respect to Additional Bonds are met, and
such terms and conditions shall apply with equal force to such re-
funding bonds. Any refunding bonds may be either delivered to the
holders of a like amount of the underlying bonds upon simultaneous
surrender and cancellation of sue:h'underly'ing bonds, or, if author-
ized by law, m~y be sold and delivered to purchasers pu.rsuant to
payment therefor for not less than par and accrued interest, in
which event the proceeds of sale and delivery shall be deposited in
the bank of payment and applied to the payment of the underlying
bonds authorized to be refunded.
12.04 - NO COMPETING SYSTEM: That the City further covenants and
agrees that, to the extent it legally may, so long as any of the
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granted for the installa'ti.on or operation of any compet1~~.g system,
tha t the City will proh1.bi t the operation of any system other than
those owned by the City, and the operation of any such system by
anyone other than the City is hereby prohibited.
Section 13:
ORDINANCE IS CONTRACT: That the provisions of this ordinance shall
constitute a contract between the City and the holder or holders
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from time to time of the Bonds, and after the issuance of any of
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said Bonds, no change, variation, or alteration of any kind in. the
provisions of this ordinance may be made until all of said Bonds
have been paid in full as to both principal and interest.
Section 14:
SUBROGATION: That, except as provided herein, the holder or holders
of the Bonds authorized by this ordinance are, and shall be, subro-
gated to all the rights and privileges had and possessed by the
holder or holders of the Underlying Bonds which are being refunded
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by the issuance of this series of Bonds.
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Section 15:
APPROVAL AND REGISTRATION OF BONDS BY STATE OFFICERS, AND EXCHANGE,
OF BONDS FOR UNDERLYING BONDS: That it shall be the duty of the
Mayor to submit the record or aald Bonds, and the Bonds, to the
Attorney General of the State of Texas for examination and approval,
and after such Bonds have been so approved, t~ have them registered
by the Comptroller of Public Accounts of the State of Texas. Said
Bonds shall not be registered until and as a like principal amount
of the Underlying Bonds have 'been surrendered for exchange and can-
'~""""" cella tion.
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When said Underlying Bonds are surrendered to said
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of Public Accounts, he is authorized and directed to
deliver the Bonds authorized by this ordinance in like principal
amount to the holder or holders of the Underlying Bonds so sur-
rendered.
Section 16:
DUTIES OF CITY OFFICERS: That the Mayor, the City Clerk, and other
appropriate officials of the City are hereby authorized and directed
to do any and all things necessary or convenient to carry out the
provisions of this ordinance.
Section 17:
EFFECTIVE DATE OF ORDINANCE: That this ordinance shall be effective
upon and after its adoption.
PASSED AND APPROVED this 6th day of April, 1962.
ATTEST:
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( SEAL)
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RESOLUTION
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WHEREAS, the City of La Porte has certain funds on deposit
with Southwestern Savings & Loan Association of Houston, Texas, and also
with Heights Savings & Loan of Houston, Texas; and,
WHEREAS, it has been determined by the City Commission of
the City of La Porte that it is necessary to withdraw certain funds from
each of said institutions with which to meet the requirements of certain
bonded indebtednesses.
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THEREFORE, BE IT RESOLVED BY THE CITY CO:M:MISSION
OF THE CITY OF LA PORTE:
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The City of La Porte shall withdraw from deposit the sum of
$10,000.00 from each of the present depositories, namely Southwestern
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Savings & Loan Association of Houston, Texas, and Heights Savings &
Loan of Houston, Texas.
PASSED AND APPROVED this the 6th day of April, 1962.
ATTEST:
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". _' Frank G., Baker, City Secretar,y
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