ORD 238 08/09/1977 Oil Iik
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ORDINANCE NO. 238
AN ORDINANCE by the City Council of the City of Cibolo,
Texas , authorizing the issuance of $40 ,000 "CITY OF
CIBOLO, TEXAS , WATERWORKS AND SEWER SYSTEM JUNIOR
LIEN REVENUE BONDS, SERIES 1977," dated July 10 , 1977,
to provide funds for improvements and extensions to the
City' s Waterworks System; prescribing the form of
the bonds and the form of the interest coupons ; pledging
the net revenues of the City's Waterworks and Sanitary
Sewer System to the payment and security of the bonds ;
reserving the right to issue additional revenue bonds ;
making certain covenants and agreements pertaining to
the operation of the City's Waterworks and Sanitary Sewer
System and the revenues derived therefrom; enacting other
provisions incident and related to the subject and purpose
of this ordinance; and declaring an emergency.
WHEREAS , pursuant to an election held on the 10th day of
August, 1974, the City Council of the City of Cibolo, Texas
became authorized and empowered to issue revenue bonds as
follows :
$250 ,000 for constructing improvements and extensions
to the City's Waterworks System; and
$125 ,000 for constructing improvements and extensions
to the City's Sanitary Sewer System,
such bonds to be secured by a pledge of the net revenues from
the operation of the City's combined Waterworks and Sanitary
Sewer System; and
WHEREAS, a portion of the revenue bonds authorized at said
election have been heretofore issued in one installment, a
schedule of the amount of bonds issued and remaining unissued
being as follows :
Total Amount Amount heretofore Unissued
Purpose Authorized Issued Amount
Water $250,000 -0- $250, 000
Sewer $ 125,000 $60 ,000 $ 65,000
AND WHEREAS , this Council hereby finds and determines that
additional revenue bonds authorized at said election inthe
principal amount of $40,000 to provide funds for constructing
improvements and extensions to the City's Waterworks System
should now be issued, and such bonds shall. be secured by and
payable from a lien on and pledge of the net revenues of the
. City 's Waterworks and Sanitary Sewer System, which lien and
pledge are junior and subordinate to the lien and pledge made
for the payment and security of the "superior lien bonds"
(hereinafter defined and identified in Section 9) ; and
WHEREAS, this Council further reserves the right and authority
to issue the remainder of revenue bonds authorized at the election
held on August 10 , 1974 in one or more installments when, in
the judgment of the City Council such bonds should be issued
to provide funds for the authorized purposes ; now therefore;
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CIBOLO, 1
TEXAS :
SECTION 1 : Authorization - Principal Amount - Designation.
That in order to borrow the sum of FORTY THOUSAND DOLLARS
($40,000) for the purpose of constructing improvements and ex-
tensions to the City's Waterworks System, the City Council
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of the City of Cibolo, Texas , by virtue of authority expressly
conferred at the aforesaid election and pursuant to the General
Laws of the State of Texas , particularly Article 1111 et seq. ,
V.A.T.C .S . , has determined that there shall be issued and there
is hereby ordered to be issued a series of coupon bonds to be
designated "CITY OF CIBOLO, TEXAS , WATERWORKS AND SEWER SYSTEM
JUNIOR LIEN REVENUE BONDS , SERIES 1977 ," in the principal sum
of FORTY THOUSAND DOLLARS ($40 ,000)
SECTION 2 : Date - Numbers - Maturity - Option, That said
bonds shall be dated July 10 , 1977 , shall be numbered consecutively
from One (1) through Eight (8) ; shall each be in the denomination
of Five Thousand Dollars ($5 ,000) ; and shall become due and
payable serially, do January 10 in each of the years in accordance
with the following schedule:
BOND NUMBERS
(All Inclusive) MATURITY AMOUNT
1 and 2 1994 $10 ,000
3 and 4 1995 10 ,000
5 and 6 1996 10 ,000
7 and 8 1997 10 ,000
PROVIDED, HOWEVER, that the City of Cibolo, Texas , reserves the
right to redeem all bonds of this series , in whole or any part
thereof, on January 10 , 1985, or on any interest payment date
thereafter at the price of par and accrued interest to the date
fixed for redemption; PROVIDED, FURTHER, that at least thirty
(30) days prior to a date any of said bonds are to be redeemed,
a notice of redemption, signed by the City Secretary (specifying
the serial numbers and amount of bonds td be redeemed) , shall
have been filed with the Cibolo State Bank, Cibolo, Texas , (the
paying agent named in each of said bonds) ; and if by the date
so fixed for redemption the City shall have made available
funds in amounts sufficient to pay the bonds to be redeemed and
accrued interest thereon, any bond or bonds not presented for
redemption pursuant to such notice 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 of Six percentum (6 .00%) per
annum, such interest to be evidenced by proper coupons attached
to each of said bonds ; and said interest shall be payable on
July 10, 1978, and semiannually thereafter on January 10 and
July 10 in each year.
SECTION 4: Place of Payment . That both principal of and
interest on this issue 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 Cibolo State
Bank, Cibolo, Texas, upon presentation and surrender of bonds
or proper coupons .
SECTION 5 : Execution of Bonds and Coupons . That the seal
of said City may be impressed on each of said bonds or, in the
alternative, a facsimile of such seal may be printed on the said
bonds . The bonds and interest coupons appurtenant thereto may
be executed by the imprinted facsimile signatures of the Mayor
and City Secretary 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 of the State of Texas , only his
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signature (or that of a deputy designated in writing to act fpr
the Comptroller) shall be required to be manually subscribed to
such bonds in connection with his registration certificate to
appear thereon, as hereinafter provided; all in accordance with
the provisions of Article 717j -1, V.A.T. C .S.
SECTION 6 : Form of Bonds. That the form of said bonds
shall be substantially as follows :
NO. UNITED STATES OF AMERICA $5,000
STATE OF TEXAS
COUNTY OF GUADALUPE
CITY OF CIBOLO, TEXAS, WATERWORKS AND SEWER SYSTEM
JUNIOR LIEN REVENUE BOND, SERIES 1977
THE CITY OF CIBOLO, a municipal corporation of the State of
Texas , acknowledges itself indebted to and, FOR VALUE RECEIVED,
hereby promises to pay to bearer, as hereinafter stated, the sum
of
FIVE THOUSAND DOLLARS
($5,000) , in lawful money of the United States of America, on the
TENTH DAY OF JANUARY, 19 , with interest thereon from the date
hereof to maturity at the rate of SIX PER CENTUM (6. 00%) per
annum, payable on July 10 , 1978, and semiannually thereafter on
January 10 and July 10 in each year, and interest falling 'due on
or prior to maturity hereof is payable only upon presentation
and surrender of the interest coupons hereto attached as they
severally become due.
BOTH PRINCIPAL of and interest on this bond shall be payable
at the Cibolo State Bank, Cibolo, Texas , without exchange or
collection charges to the owner or holder, and the said City of
Cibolo, Texas , is hereby held and firmly bound to apply the
pledged appropriated net revenues of its combined Waterworks and
Sanitary Sewer System to the prompt payment of principal of and
interest of this bond at maturity and to pay said principal and
interest as they mature.
THIS BOND is one of a series of bonds aggregating in amount
FORTY THOUSAND DOLLARS ($40 ,000) , numbered consecutively from
One (1) through Eight (8) , each in denomination 'of Five Thousand
Dollars ($5, 000) , issued for the purpose of constructing improve-
ments and extensions to the City 'Waterworks System, in
accordance with the Constitution and laws of the State of Texas ,
particularly Article 1111 et seq. , V.AOT.C.S . ,. and by authority
of an election held for that purpose within said City and pursuant
to an ordinance passed by the City Council of the City of Cibolo,
Texas , and duly recorded in the Minutes of said City Council.
AS SPECIFIED in the ordinance hereinabove mentioned, the
City reserves the right to redeem all bonds of said series , in
whole or any part thereof, on January 10 , 1985, or on any interest
payment date thereafter, at the price of par and accrued interest
to the date fixed for redemption; PROVIDED, HOWEVER, that at least
thirty (30) days prior to a date any of said bonds are to be
redeemed, a notice of redemption, signed by the City Secretary
(specifying the serial numbers and amount of bonds to be redeemed)
shall have been filed with the Cibolo State Bank, Cibolo, Texas;
and if by the date so fixed for redemption the City shall have made
available funds in amounts sufficient to pay the bonds to be re-
deemed and accrued interest thereon, any bond or bonds not presented
for redemption pursuant to such notice shall cease to bear interest
from and after the date so fixed for redemption.
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SECTION 7: Coupon Forma That the form of interest coupons
attached to each of said bonds shall be substantially as follows :
NO. ON THE TENTH DAY OF $
19
*(unless the bond to which this coupons pertains has been properly
called for redemption in accordance with its terms) the CITY OF
CIBOLO, 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 taxation) , and in
lawful money of the United States of America, without exchange
or collection charges to the owner or holder, at the Cibolo State
Bank, Cibolo, Texas , the sum of
DOLLARS
($ ) , said sum being months ' interest due
that day on "CITY OF CIBOLO, TEXAS , WATERWORKS AND SEWER SYSTEM
JUNIOR LIEN REVENUE BOND, SERIES 1977, " dated July 10., 1977.
Bond No .
IP
City Sec Lary Mayor
SECTION 8 : Form of Com•trolie ' s Certificate. Subst ntia ly
the following shall •e printes on the back of each bond:
OFFICE OF COMPTROLLER §
§ REGISTER NO, '
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 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
Cibolo, Texas , payable from the revenues pledged to its payment
by and in the ordinance authorizing same, 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
* NOTE TO PRINTER: The expression in parentheses to be included
only in coupons maturing July 10 , 1985, and subsequent , pertaining
to all bonds of this series .
0lor
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 pledge and appropriation of
revenues therefor, the following definitions are provided:
(a) The term "System" shall mean the City' s combined
Waterworks and Sanitary Sewer System, including all present
and future extensions , additions, replacements and improve-
ments in any wise appertaining thereto, whether situated
within or without the limits of said City;
(b) The term "net revenues" shall mean the gross
revenues of the System less the expense of operation and
maintenance, including all salaries , labor, materials ,
interest, repairs and extensions necessary to render eff-
cient service; provided, however, that 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 adequate service to the
City and the inhabitants thereof, or such as might be
necessary to meet some physical accident or condition which
would otherwise impair the security of any bonds payable
from and secured by a lien on the net revenues of the
System shall be deducted in determining "net revenues";
(c) The term "bonds" shall mean the $40 ,000 revenue
bonds authorized by this ordinance;
(d) The term "additional junior lien bonds" shall
mean the additional parity revenue bonds which the City
reserves the right to issue in accordance with the terms
and conditions prescribed in Section 20 of this ordinance;
(e) The term "fiscal year" shall mean the twelve month
period ending September 30 of each year;
(f) The term "superior lien bonds" shall mean the
outstanding and unpaid "CITY OF CIBOLO, TEXAS, WATERWORKS
AND SEWER SYSTEM REVENUE BONDS , SERIES 1975 ," dated
January 10, 1975 , originally issued in the total principal
amount of $60,000 and additional bonds and refunding bonds
issued on a parity therewith in accordance with the terms
and conditions contained in the ordinance(s) authorizing
the issuance of such bonds ; all of which bonds are payable
from and secured by a first lien on and pledge of the net
revenues of the City' s combined Waterworks and Sanitary Sewer
System; and
(g) The term "junior lien bonds" shall mean the bonds ,
additional junior lien bonds and refunding bonds issued on
a parity therewith, all of said bonds being payable from and
secured by a lien on and pledge of the net revenues of the
City's combined Waterworks and Sanitary Sewer System, which
lien and pledge are junior and subordinate to the lien and
pledge securing the superior lien bonds .
SECTION 10 : Pledge. The City covenants and agrees that
subject only to the prior pledge of the net revenues of the System
to the payment of principal, interest and reserve fund requirements
of the superior lien bonds , and the means and methods of accumu-
lating and maintaining all funds required therefor under the pro-
visions of the ordinance(s) and proceedings pertaining to the
authorization of such superior lien bonds , the entire net revenues
of the System (with the exception of those in excess of the amounts
required to establish and maintain the Funds as hereinafter pro-
vided) are hereby irrevocably pledged for the payment of principal
and interest, including the establishment and maintenance of the
Reserve Fund designated for the junior lien bonds .
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SECTION 11: Fund Designations . All revenues derived from
the operation of the System shall be kept separate from other
funds of the City. To that end the following special Funds shall
be created and/or maintained:
(a) City of Cibolo Waterworks and Sewer System Fund,
hereinafter called "System Fund" , heretofore created and
hereby reaffirmed. This Fund shall be kept in the City's
depository bank.
(b) City of Cibolo Waterworks and Sewer System Junior
Lien Revenue Interest and Sinking Fund, hereinafter called
"Bond Fund". This Fund shall be deposited with the Cibolo
State Bank, Cibolo, Texas , as Trustee of the pledged revenues ,
and shall be used to pay principal of and interest on the
junior lien bonds when and as the same shall become due and
payable.
(c) City of Cibolo Waterworks and Sewer System Junior
Lien Revenue Bond Reserve Fund, hereinafter called "Reserve
Fund" . This Fund shall be deposited with the Cibolo State
Bank, Cibolo, Texas , as Trustee, and shall be used to pay
principal of and/or interest on the junior lien bonds falling
due at any time when there is not sufficient money available
in the Bond Fund.
SECTION 12 : System Fund. All revenues of every nature ,
derived from the operation of the System shall be deposited from
day to day as collection into the System Fund, heretofore es-
tablished in connection with the issuance of the superior lien
bonds , to be kept separate and apart from all other City funds
and accounts . All revenues deposited in the System Fund ahall
be appropriated and used for the following purposes in the order
of precedence shown, to wit :
(a) To the payment of all reasonable and proper
expenses of operating and maintaining the System as set
forth in Section 9 (b) hereof.
(b) To the payment of all amounts required to be
deposited in the special Funds created for the payment
and security of the superior lien bonds in accordance.
with the terms and provisions of the ordinances authorizing
their issuance .
(c) To the payment of all amounts required to be
deposited in the Bond Fund and Reserve Fund herein created
for the payment and security of the junior lien bonds .
(d) To any other proper City purpose now or hereafter
permitted by law.
SECTION 13: Bond Fund. That the City hereby covenants and
agrees to deposit in the Bond Fund from the net revenues of the
System in the System Fund the following amounts to pay the princi-
pal of and interest on the bonds as the same becomes due, to wit :
(a) Deposits for payment of interest. Beginning on or
before the 1st day of September , 1977, and on or before the
1st day of each following month to and including July 1, 1978 ,
an amount equal to one-eleventh (1/11) of the installment
of interest to become due on the bonds on July '.10 , 1978; and,
thereafter, on or before August 1 , 1978, and on or before the
1st day of each following month, an amount equal to not less
than one-sixth (1/6) of the next semiannual installment of
interest to become due on the bonds ; and
(b) Deposits for payment of principal. Beginning on or
before the 1st day of February, 1993, and on or before the
1st day of each month thereafter an amount equal to not less
than one-twelfth (1/12) of the next annual principal payment
to become due on the bonds .
The monthly deposits to the Bond Fund for the payment of
principal and interest on the bonds shall continue to be made
as hereinabove provided until such time as (i) the total amount
on deposit in the Bond Fund and Reserve Fund is equal to the
amount required to pay all outstanding indebtedness (principal
and interest) for which said Funds were created and established
(Section ll[b] and Section 11 [c]) or (ii) the bonds are no longer
outstanding, i.e. fully paid as to principal and interest or
refunded.
Accrued interest and premium, if any, received from the
purchaser of the bonds , as well as any proceeds of the bonds not
required to complete the improvements and extensions to be made
to the System for which the bonds are being issued, shall be
deposited to the Bond Fund, and may be taken into consideration
and reduce the amount of the monthly deposits hereinabove pro-
vided which would otherwise be required to be deposited in the
Bond Fund from the net revenues of the System.
SECTION 14: Reserve Fund, That the City hereby agrees
with the holders of the bonds that it will provide for the
accumulation of, and when accumulated, will thereafter continously
maintain in the Reserve Fund an amount equal to not less than
the average annual principal and interest requirements of the
junior lien bonds (calculated as of the date of issuance of the
last series of junior lien bonds) .
By reason of the issuance of the bonds , the amount to be
accumulated and maintained in the Reserve Fund is hereby
determined to be $ .e1/49o°9 (which amount equals to not
less than the average annual principal and interest requirements
of the bonds) , and the City hereby covenants and agrees that,
beginning September 1 , 1977, and on or before the 1st day of
each month thereafter, there shall be deposited in the Reserve
Fund an amount equal to not less than $ 70°P until the
amount of cash and investments in said Fund totals not less than
$ -2oD'' . When the total amount required to be deposited
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in e Reserve Fund has been fully accumulated, said monthly
payments to said Fund may be terminated; provided, however ,
should the amount on deposit in said Fund be reduced below
$ 'f oo ° , after the same has been accumulated, such monthly
deposits shall be resumed as herein specified and continued to
be made on or before the 1st day of each month until the amount
required to be deposited therein has been fully restored.
Money in the Reserve Fund may be , at the option of the City,
invested or reinvested from time to time in direct obligations of
or obligations the principal and interest of which are guaranteed
by the United States of America, such obligations to mature in not
more than ten years from the date of such investment or not later
than the final maturity of the outstanding junior lien bonds ,
whichever period is shorter . Any obligations in which money is
so invested shall be kept in escrow in the Cibolo State Bank,
Cibolo, Texas , and shall be promptly sold and the proceeds of
sale applied to the making of payments required to be made from
the Reserve Fund whenever such payments are necessary to be made
under the provisions of Section 11(c) . The deposits to the
Reserve Fund shall be subordinate to those required to be made into
the Bond Fund.
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SECTION 15 : Rates and Charges _ The City covenants and
agrees with the holders of the bonds that so long as any
superior lien bonds or junior lien bonds , or any interest
thereon, remain outstanding and unpaid, it will charge and
collect for services rendered by the System revenues sufficient
at all times to :
(a) Pay all operating, maintenance, depreciation,
replacement and betterment expenses , and other costs
deductible in determining net revenues ;
(b) Establish and fully maintain all special Funds
provided for the benefit of the superior lien bonds in
accordance wtih the ordinance(s) authorizing the issuance
thereof;
(c) Establish and maintain the Bond Fund and Reserve
Fund herein created for the junior lien bonds ; and
(d) Pay the requirements of all other outstanding
lawful, indebtedness of the System as and when the same
becomes due.
SECTION 16 : Deficiencies in Funds . If in any month the
City shall, for any reason, fail to pay into the Bond Fund and
Reserve Fund the full amounts above stipulated, amounts equiva-
lent to such deficiencies shall be set apart and paid into said
Funds from the first available and unallocated revenues of the
System for the following month or months and such payments shall
be in addition to the amounts hereinabove provided to be other-
wise paid into said Funds during such month or months .
SECTION 17 : Excess Revenues . Any revenues in excess of
those required to establish and maintain the Funds as above
required may be used for the redemption of superior lien bonds ,
junior lien bonds , or for any lawful purpose.
SECTION 18 : Security of Funds . All moneys on deposit in
the special Funds for which this ordinance makes provision (ex-
cept any portions thereof as may be at any time properly invested)
shall be secured in the manner and to the fullest extent required
by the laws of Texas for the security of public funds , and such
moneys deposited in such Funds shall be used only for the purposes
permitted by this ordinance.
SECTION 19 : Issuance of Additional Superior, Lien Bonds , The
City of Cibolo hereay reserves and retains the right to issue
additional revenue bonds (including refunding bonds issued to
refund outstanding obligations payable from a first lien on and
pledge of the net revenues of the System) on a parity with, and
equally secured in the same manner as , the outstanding and unpaid
superior lien bonds in accordance with the terms and conditions
contained in the ordinance(s) authorizing the issuance of such
superior lien bonds .
SECTION 20 : Issuance of Additional Junior Lien Bonds
Authorized, In addition to the right to issue bonds of inferior
lien as authorized by the laws of this State , the City reserves
the right to issue additional junior lien revenue bonds which,
when duly authorized and issued in compliance with law and the
terms and conditions hereinafter appearing, shall be on a parity
with the bonds herein authorized, payable from and equally and
ratably secured by a lien on and pledge of the revenues of the
System, and the bonds and additional bonds shall in all respects
be of equal dignity. The additional bonds may be issued in one
or more installments , provided, however, that none shall be issued
unless and until the following conditions have been met :
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(a) The City is not then in default as to any
covenant, condition or obligation prescribed by this
ordinance,
(b) Each of the Funds created and established for
the payment and security of the junior lien bonds contains
the amount of money then required to be on deposit therein.
(c) The ordinance authorizing issuance of the
additional bonds provides for the accumulation in the
Bond Fund of amounts sufficient to pay the principal
of and interest on such additional junior lien bonds
as same mature.-
(d) The ordinance authorizing issuance of the
additional junior lien bonds provides that the amount
to be accumulated and maintained in the Reserve Fund
shall be not less than the average annual requirement
for the payment of principal of and interest on all out-
standing junior lien bonds after giving effect to the
issuance of the proposed additional junior lien bonds ,
and provides that any additional Reserve Fund amount
which may thus be required shall be accumulated not more
than ten calendar years from the date of the passage
of the ordinance authorizing the issuance of the proposed
additional bonds .
Junior lien bonds may be refunded (pursuant to any law
then available) upon such terms and conditions as the governing
body of the City may deem to be in the best interests of the
City and its inhabitants .
. SECTION 21: Maintenance and Operation - Insurance. The
City shall maintain the System in good condition and operate the
same in an efficient manner and at reasonable cost . So long as
any of the bonds are outstanding , the City agrees to maintain
insurance on the System for the benefit of the holder or holders
of the bonds of a kind and in an amount which usually would be
carried by private companies engaged in a similar type of business .
Nothing in this section shall be construed as requiring the City
to expend any, funds which are derived from sources other than
the operation of the System but nothing herein shall be construed
as preventing the City from doing so .
SECTIION 22 : Records - Accounts Accounting Reports . The
City of Cibolo here y covenants and agrees that so fang as any of
the bonds or any interest thereon remain outstanding and unpaid,
it will keep and maintain a proper and complete system of records
and accounts pertaining to the operation of the System (separate
and apart from all other records and accounts) in which complete
and correct entries shall be made of all transactions relating to
said System, as provided by Article 1113, V.A.T.C . S . , and that
the holder or holders 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 records , accounts and data
relating thereto, and to inspect the System and all properties
comprising same. The City further agrees that within sixty (60)
days following the close of each fiscal year , it will cause an
audit of such booksand accounts to be made by an independent
firm of Certified Public Accountants or Licensed Public Accountants .
Each such audit, in addition to whatever other matters may be
thought proper by the Accountant, shall particularly include the
following :
(a) A detailed statement of the income and ex-
penditures of the System for such fiscal year;
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(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 changes or improve-
ments 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 the 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 list of the securities which have been on
deposit as security for the money in the Bond Fund
throughout the fiscal year, a list of the securities ,
if any, in which the Reserve Fund has been invested, and
a statement of the manner in which money in the System
Fund has been secured in such fiscal year;
(f) The number of properties connected with the
System.
Expenses incurred in making the audits above referred to are
to be regarded as maintenance and operating expenses and paid as
such. Copies of the aforesaid annual audit shall be immediately
furnished to the Executive Director of the Municipal Advisory
Council of Texas at his office in Austin, Texas , and to the
original purchasers of the bonds and any subsequent holder at his
request . At the close of the first six monthsperiod of each
fiscal year, the City Secretary is hereby directed to furnish 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 (30) days after the close of said
six month 's period. Any bondholder shall have the right to discuss
with the Accountant making the annual audit the contents thereof
and to ask for such additional information as he may reasonably
require.
SECTION 23 : Remedies in Event of Default. In addition to
all the rights and remedies provided"by the laws of the State of
Texas , the City covenants and agrees particularly that in the
event the City (a) defaults in payments to be made to the Bond
Fund and Reserve Fund, or (b) defaults in the observance 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 proper jurisdiction compelling and requiring the City Council
and other officers of the City to observe and perform any covenant,
condition or obligation prescribed in this bond ordinance.
No delay or omission to exercise any right or power accruing
upon any default shall impair any such right or power, or shall be
construed to be a waiver of any such default or acquiescence
therein, and every such right and power may be exercised from
time to time and as often as may be deemed expedient . The specific
remedies herein provided shall be cumulative of all other existing
remedies and the specification of such remedies shall not be deemed
to be exclusive .
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SECTION 24: Special "Covenants ,. The City hereby further
covenants as follows :
(a) That it has the lawful power to pledge the
revenues supporting this issue of bonds and has lawfully
exercised said power under the Constitution and laws of
the State of Texas , including said power existing under
Articles 1111 through 1118, V0A,T,C0S , ; that the bonds
shall be ratably secured under said pledge of income in
such manner that one bond shall have no preference over
any other bond of this issue;
(b) That other than for the payment of the out-
standing and unpaid superior lien bonds and the bonds , the rent,
revenues and income of the System have not in any manner
been pledged to the payment of any debt or obligation
of the City or of the System;
(c) That, so long as any junior lien bonds or any
interest thereon remain outstanding, the City will not
sell, lease or encumber the System or any substantial
part thereof, provided that this shall not be construed
to prohibit the sale of such machinery, or other pro-
perties or equipment which has become obsolete or other-
wise unsuited to the efficient operation of the system;
also; with the exception of the additional bonds expressly
permitted by this ordinance to be issued in Sections 19
and 20 , it will not encumber the net revenues thereof unless
such encumbrance is made junior and subordinate to all of
the provisions of this ordinance;
(d) That no free service of the System shall be
allowed, and should the City of any of its agencies or
instrumentalities make use of the services and facilities
of the System, payment of the reasonable value thereof
shall be made by the City out of funds from sources other
than the revenues and income of the System;
(e) To the extent that it legally can, the City
further covenants and agrees that, so long as any of
the junior lien bonds or any interest thereon are out-
standing, no franchise shall be granted for the installation
or operation of any competing waterworks or sewer system,
that the City will prohibit the operation of any water
system or sewer system other than those owned by the City
and the operation of any such system by anyone other that
the City is hereby prohibited.
SECTION 25 : Bonds are Special Obli•ations , The bonds are
special obligations o t` e City payas e rom t e pledged net
revenues , and the holders thereof shall never have the right to
demand payment thereof out of funds raised or to be raised by
taxation.
SECTION 26 : Bonds as Negotiable Instruments . Each of the
bonds herein authorized shall be deemed and construed to be a
"Security" , and as such a negotiable instrument, within the
eaning of Article 8 of the Uniform Commercial Code.
410
•
. •
SECTION 27 : Mayor to Have Charge of Records and Bonds . The
Mayor of the City of Cibolo shall be and he is hereby authorized
to take and have charge of all necessary orders and records
pending 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,
registration by the Comptroller of Public Accounts , and delivery
to the purchasers thereof
SECTION 28: No Arbitrage. That the City hereby covenants
that the proceeds from the sale of the bonds will be used as
soon as practicable for the purpose for which said bonds are
issued; that such proceeds will not be invested in any securities
or obligations except for the temporary period pending such use;
and that such proceeds will not be used directly or indirectly
so as to cause all or any part of said bonds to be or become
"arbitrage bonds" within the meaning of Section 103(c) of the
Internal Revenue Code of 1954, as amended, or any regulations
or rulings prescribed or made pursuant thereto.
SECTION 29 : Confirmation" of Sale. That the sale of the bonds
hereinauthorizedto the CIBOLO STATE BANK, Cibolo, Texas , at the
price of par and accrued interest to date of delivery is hereby
confirmed. Delivery of said bonds shall be made to such purchaser
as soon as may be after the adoption of this ordinance, upon: pay-
ment therefor in accordance wtih the terms of sale .
SECTION 30 : Emergency. That the public importance of this
measure and the fact that it is to the best interest of the City
to provide funds to improve and extend the City's Waterworks
System at the earliest possible date, for the immediate
preservation of the public peace, health, safety and public welfare
of its inhabitants , constitutes an emergency measure, and that
any rule requiring ordinances to be read more than one or
at more than one meeting be suspended, and any such rule is
hereby suspended and this ordinance is accordingly passed as an
emergency measure and shall take effect and be in force immediately
from and after its passage .
PASSED AND APPROVED, this the day of , 1977.
,.
0a ., , , ,
Mayo. , -ity :0 i. . G , , e- T"—
ATTEST: a- !*rATTEST:
A
C ty ecretary, C;ty o i.o7•-, Texas
1 '(City Seal)
i410
0
i
THE DATE of this bond in conformity with the ordinance
above mentioned is July 10 , 1977 .
THIS BOND and the series of which it is a part constitute
special obligations of the City of Cibolo, Texas , payable from
and equally secured by a lien on and pledge of the net revenues
of the City 's combined Waterworks and Sanitary Sewer System, such
lien and pledge, however, being junior and subordinate to the
lien and pledge made for the payment and security of "superior
lien bonds" (defined and identified in the ordinance authorizing
the series of bonds of which this bond is one) ; and for a more
complete statement of the convenants and provisions securing the
payment of this bond and the series of which it is one, reference
is hereby made to the ordinance authorizing this series of bonds .
THE CITY expressly reserves the right to issue further and
additional revenue bond obligations in all things on a parity
with the outstanding and unpaid "superior lien bonds" as well as
additional revenue bond obligations on a parity with the bonds of
this series; PROVIDED, HOWEVER, that any and all such additional
bonds may be so issued only in accordance with and subject to
the covenants , conditions , limitations and restrictions relating
thereto which are set out and contained in the ordinances
authorizing the "superior lien bonds" and thebonds of this
series and to which ordinances reference is hereby made for
more complete and full particulars .
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.
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 in regular and due time, form
and 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 City's combined Waterworks and Sanitary Sewer
System, subject only to the pledge hereinabove recited with
respect to the superior lien bonds which are payable from the
same source.
IN TESTIMONY WHEREOF, the City Council of the City of
Cibolo, Texas, in accordance with the provisions of Article
717j-1 , 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 10th day of July, 1977.
Alt•
ftp `1
Mayor, ity o Gibo o, / exas
COUNTERSIGNED: / J
Cit ecretar
Y y, ity o�� o, Texas
v • • • • •
Re: $40 ,000 "City of Cibolo, Texas , Waterworks and Sewer System
Junior Lien Revenue Bonds , Series 1977, " dated July 10 , 1977
Gentlemen:
You will receive the registered bonds of the above
series from the Comptroller of Public Accounts and one copy
of the approving opinion of the Attorney General. At such
time as you have received the bonds , we ask that Bond Number
One and the copy of the approving opinion of the Attorney
General be sent to Messrs . Dumas , Huguenin, Boothman and
Morrow, Attorneys , 1212 United National Bank Building , Dallas ,
Texas , 75201 for their examination and return. When the bond
has been returned to you, this will be your authority to
deliver said bonds to the purchasers thereof,
CIBOLO STATE BANK, Cibolo, Texas
or their order, upon payment therefor in accordance with the
terms of the Treasurer' s Receipt forwarded to you, said pay-
ment to be made in immediately available funds transmitted by
fastest means to the depository bank.
Enclosed herewith you will find three Signature and No-
Litigation Certificates , executed and completed except as to
date. When the bonds have been taken up and paid for, kindly
date and release all copies of this certificate to Messrs .
Dumas , Huguenin, Boothman and Morrow, Attorneys , Dallas , Texas .
Should any litigation having any effect upon the subject
bonds develop prior to the time you have received payment for
the bonds , we, the undersigned, will notify you at once by
telephone and by telegraph. You may thus be assured that there
is no such litigation at the time the bonds are delivered to
you unless you have been advised otherwise in the manner afore-
mentioned.
Thanking you for your assistance in this matter, we are,
Very truly yours ,
i /1:3
Mayo , City of Cibolo, 'hex s �%
', T
City ,.secretary, City o "Ci.oy, Texas
t • • •
•
Re: $40,000 "City of Cibolo, Texas, Waterworks and Sewer System
Junior Lien Revenue Bonds, Series 1977 ," dated July 10 , 1977
Gentlemen:
When the above bonds have been paid for, kindly transmit
the proceeds thereof to
which is the depository bank for the City above named, said
payment to be made in immediately available funds transmitted
by the fastest means to said Bank.
Enclosed herewith you will find three executed but undated
copies of Treasurer' s Receipt pertaining to this issue; and
when the bonds have been taken up and paid for, kindly date
and release all copies of this receipt to Messrs . Dumas,
Huguenin, Boothman and Morrow, Attorneys , 1212 United National
Bank Building, Dallas , Texas 75201.
Thanking you for your assistance in this matter, we are,
Very truly yours ,
c.0Treasur�r , City o
ity ibolo
Texas -
• • • • •
Honorable Bob Bullock
Comptroller of Public Accounts
Capitol Station
Austin, Texas 78711
Attention: Bond Division
Re : $40 ,000 "City of Cibolo , Texas , Waterworks and Sewer
System Junior Lien Revenue Bonds , Series 1977," dated
July 10 , 1977
Dear Sir:
The bonds described above will be delivered to you
by the Attorney General when approved by him, and we
request that you kindly register these bonds on behalf of
the City, and when so registered, deliver them to
for further handling under our instructions to them.
We further request that one copy of the approving
opinion of the Attorney General be enclosed with the bonds
when they are delivered to the aforementioned bank, and two
additional copies of said approving opinion be mailed direct
to Messrs . Dumas , Huguenin, Boothman and Morrow, Attorneys ,
1212 United National Bank Building, Dallas , Texas 75201..
Thanking you for your assistance in this matter, we are,.
Very truly yours ,
1
„AK -.4) 0•11(1.47
. . , City c1( i i o, Te as
Office of the
Attorney General of Texas
P.O. Box 12548
Capitol Station
Austin, Texas 78711
ATTENTION: Bond Division
Re: $40 ,000 "City of Cibolo, Texas , Waterworks and Sewer System
Junior Lien Revenue Bonds , Series 1977, " dated July 10 , 1977
Gentlemen:
The printed and executed bonds of the above series
have been or soon will be delivered to you for approval.
In this connection, we are sending herewith signature and
no-litigation certificate executed and completed except
as to date.
When the bonds have receivedyour approval and are
ready for delivery to the Comptroller of Public Accounts
for registration, this will be your authority to insert .
that date in the certificate and deliver such bonds to the
Comptroller.
Should litigation in any way affecting such bonds
develop , or should any type petition or request be sub-
mitted for a referendum prior to that date , we, the under-
signed, will notify you at once by telephone and by tele-
graph. You may thus be assured that there is no such liti-
gation at the time the bonds are finally approved by you
unless you have been .advised otherwise in the manner afore-
mentioned.
Thanking you for your assistance in this matter, we are,
Very truly yours ,
Qi-3/1„4/ )71-
T v
May ``City o Cibolo, exly
`s
City Secretary, City o/Cibolo ,
Texas
111 40 •
. ,
• li
Messrs . Dumas , Huguenin, Boothman and Morrow
Attorneys at Law
1212 United National Bank Building
Re : $40 ,000 "City of Cibolo, Texas, Waterworks and Sewer System
Junior Lien Revenue Bonds, Series 1977 , " dated July 10 , 1977
Gentlemen:
Enclosed you will find four No-Arbitrage Certificates,
executed but undated.
At such time as the above described bonds are delivered
to the purchaser , you are authorized to insert the delivery
date in each of these certificates .
Very truly yours ,
---1()I /- AS 'A- 7t,
Ma ,.t ', City of •'bolo , /Texa
� a_,
•
City Secretar City of Cibolo,
Texas
•
�I • S
LAW OFFICES
DUMAS, HUGUENIN, BOOTHMAN AND MORROW
1509 MAIN STREET
W P DUMAS I B90-1947) TELEPHONE
A.BRYCE HUGUENIN UNITED NATIONAL BANK BUILDING 741-3458
CLAUD 0.BOOTHMAN AREA CODE 214
ELBERT M.MORROW DALLAS, TEXAS 75201
ED H ESOUIVEL
August 11, 1977
Linda N. Ling
City Secretary
City of Cibolo
P.O. Box 156
Cibolo, Texas 78108
Re: $40, 000 "City of Cibolo, Texas, Waterworks and Sewer
System Junior Lien Revenue Bonds, Series 1977, " dated
July 10, 1977
Dear Ms . Ling:
Enclosed herewith is a copy of the No-Arbitrage Certificate
relating to the above described bonds for the files of the City.
With kind persona regards and best wishes, we are,
Cordially,
44w-.4)
/6/4/0'
COB:bs
cc: Mr. Thomas M. Anderlitch
Rauscher Pierce Securities Corporation
400 San Antonio Bank & Trust Building
San Antonio, Texas 78205
• •. 410
Lt^ •
NO ARBITRAGE CERTIFICATE
THE STATE OF TEXAS
COUNTY OF GUADALUPE §
CITY OF CIBOLO §
The undersigned, being the Mayor and City Secretary, respect-
ively,
of the City of Cibolo, Texas , HEREBY CERTIFY with respect
to that issue of "City of Cibolo, Texas , Waterworks and Sewer
System Junior Lien Revenue Bonds , Series 1977 ," dated July 10 ,
1977 , in the principal amount of $40 ,000 , as follows :
1 . That we , along with other officers , are charged
with the responsibility of issuing the bonds .
2 . That this certificate and covenant are made pursuant
to Section 1 . 103-13 of the Income Tax Regulations (the
"Regulations") of the Internal Revenue Service with: respect
to arbitrage bonds as described in .Section 103 (c) of' the
Internal Revenue Code of 1954, as amended (the "Code") , and
the words and phrases used herein have the same meanings as
defined and used in the Regulations .
3 . That this certificate is based on facts , estimates ,
and circumstances in existence on the date of issue of the
bonds , and on such basis it is reasonably expected that the
following will occur with respect to the bonds :
(a) That the City has incurred, at the date of
issue of the bonds , or will incur, within 'six -months
after the date of issue of the bonds , binding obliga-
tions to commence each of the projects , respectively,
to be financed by the bonds , either by entering into
contracts for. the construction• of such projectsto be
financed by the bonds , or by entering into contracts
for architectural or engineering services for such
projects , with the amount to be paid under each such
contract with respect to each such project to be in
excess of two and one-half percent of the part of the
proceeds of did bonds allocated to each such project,
respectively;
(b) That after entering into said contracts , work.
on all of the projects will proceed with due diligence
to completion;
(c) That all of the spendable proceeds of the
bonds will be expended for project costs by the end of
the three-year period beginning on the date of issue of
` 1 the bonds ; -
! (d) That none of the proceeds of the bonds will ,
be placed in a reserve or replacement fund, and none of- -
the proceeds of the bonds will be used to acquire any
obligations except during the temporary period of three
years beginning on the date of issue;
(e) That none of the projects will be sold or
otherwise disposed of, in whole or in part , prior to
the last maturity of the bonds ;
(f) That the original proceeds of the bonds will
not exceed by more than five percent the amount neces-
sary for the purpose or purposes of the bonds .
4 . That on the basis of the foregoing it is not expected
that the proceeds of the bonds will be used in any manner
that would cause such obligations to be arbitrage bonds
under Section 103(c) of the Code and the Regulations pre-
scribed under that Section, and it is further specifically
covenanted that the proceeds of the bonds will not be used
directly or indirectly so as to cause all or anypartof
the bonds to be or become arbitrage bonds within the meaning
of that Section or the Regulations prescribed by that Section.
r
• 410- •
�t. 0 0
5 . That to our best knowledge and belief there are no
other facts , estimates , or circumstances that would materially
change the foregoing conclusions or statements .
6 . That the City has never been listed in a Notice
published in the Internal Revenue Bulletin as described in
Paragraph (a) (2) (iii) of Section 1 . 103-13 of the Regulations ,
and has never been advised that such a listing is contemplated.
EXECUTED this the 9th day of August, , 1977 .
1 / de Al ' 7, /
leMayo **C ty of bolt , "exas
•
O. • / - or r
C ty ,ecretary , Ci of C i+,olo,
Texas
(City Seal)