Chapter 3.29
ECONOMIC DEVELOPMENT BONDS AND MATTERS RELATED THERETO

Sections:

3.29.010    Intent.

3.29.020    Definitions.

3.29.030    Legislative declaration of purpose.

3.29.040    Additional powers.

3.29.050    Exercise of powers.

3.29.060    Bonds.

3.29.070    Sale of bonds.

3.29.080    Interim receipts or certificates.

3.29.090    Bonds, etc., to be negotiable instruments.

3.29.100    Covenants in bonds.

3.29.110    Signatures of officers on bonds – Validity of bonds.

3.29.120    Pledge and lien of bonds.

3.29.130    Limited liability for bonds.

3.29.140    Exemption from construction and other requirements for public buildings.

3.29.150    Procedures established as additional and supplemental – Limitations imposed – Effect.

3.29.160    Impact aid payment or administrative fee.

3.29.170    Contract with bondholders.

3.29.180    Severability clause.

3.29.010 Intent.

The intent for establishing procedures for issuing economic development bonds and matters related thereto is:

A. The city of Palmer, Alaska, is a home rule city and under Section 11 of Article X of the Alaska Constitution may exercise all legislative powers not prohibited by law or by the Charter of the city, and it has been determined that the matters set forth in this chapter are not prohibited by law or the Charter.

B. It is necessary and for the best interests of the city to provide employment opportunities and to encourage the economic development of the city, thereby reducing the evils attendant upon unemployment and furthering the welfare and prosperity of the residents of the city.

C. The issuance of revenue bonds to finance in whole or in part the costs of the acquisition, purchase, construction, reconstruction, improvements, equipping, betterment, extension, addition, repair, alteration, rehabilitation, renovation or enlargement of economic development facilities as aforesaid is a public purpose and is a proper exercise of governmental function of the city.

D. The establishment of procedures for the issuance of such revenue bonds is authorized by the Charter including, but not limited to, Chapter XI, and is necessary and desirable to provide clarity in law and direction for subsequent actions. (Ord. 337 § 3, 1986)

3.29.020 Definitions.

Whenever used in this chapter unless a different meaning clearly appears from the context:

A. “Bonds” means revenue bonds issued as herein provided.

B. “Charter” means the Charter of the city as from time to time amended and supplemented.

C. “City” means the city of Palmer, Alaska.

D. “Construction” of or with respect to a project means and includes the acquisition, purchase, construction, reconstruction, improvement, equipping, betterment, extension, addition, repair, alteration, rehabilitation, renovation or enlargement of the project.

E. “Impact aid payment” or “administrative fee” means the impact aid payment or administrative fee pursuant to PMC 3.29.160.

F. “Person” means any individual, partnership, copartnership, firm, company, corporation (including a public utility), association, joint stock company, trust estate, political subdivision, state agency, or any other legal entity, or its legal representative, agent or assigns.

G. “Project” means any land, building, structure, facility, system, fixture, improvement, addition, appurtenance, machinery and equipment, and any real and personal property deemed necessary in connection therewith, including, but not limited to, machinery and equipment whether or not now in existence or under construction which shall be suitable for any of the following:

1. Any enterprise for the manufacturing, processing or assembling of any agricultural, manufactured or natural resource product;

2. Any commercial enterprise for the storage, warehousing, distributing, selling or providing of products or services and including research and development therefor;

3. Any health care institution;

4. Sport facilities;

5. Convention or trade show facilities;

6. Airports, parking facilities, or storage or training facilities directly related thereto;

7. Sewage or solid waste disposal facilities or facilities for the furnishing of electric energy, gas or water;

8. Industrial park facilities;

9. Air or water pollution control facilities.

H. “Project costs” means and includes the sum total of all reasonable or necessary costs incidental to the construction of a project and the issuance of bonds to finance the project in whole or in part, including, without limiting the generality of the foregoing, the following, which may be payable by or to the city or any other person:

1. Obligations incurred or assumed by the city or any other person for labor, materials, and equipment in connection with the construction for the project;

2. The cost of performance, labor and material bonds and insurance of all kinds that may be required or necessary during the course of construction of the project;

3. All costs of architectural and engineering services, including the costs incurred or assumed by the city or any other person for preliminary design and development work, test borings, surveys, estimates and plans and specifications, and for supervising construction, as well as for the performance of all other duties required by or consequent upon the proper construction of the project;

4. All costs required to be paid by the city or any other person under the terms of any contract or contracts for the construction or financing of the project;

5. Payment of the initial or acceptance fees of any trustees; the costs of any title search, insurance or opinions; any fees and expenses for recording and filing all documents and instruments in connection with the project and the construction and the financing thereof, and overhead and administrative expenses properly chargeable to capital or similar accounts in connection with the project;

6. Payment of the legal, underwriting, financial advisory, rating service and accounting fees and expenses and printing and engraving costs incurred in connection with the authorization, sale and issuance of bonds issued to finance the project in whole or in part and the preparation of all documents in connection with the project and the construction thereof and the issuance of the bonds;

7. An initial bond and interest reserve;

8. Interest to accrue on all bonds issued to finance the project in whole or in part to a date six months subsequent to the estimated date of completion of the project; and

9. The impact aid payment or administrative fee.

I. “Revenues and receipts” of a project or derived from a project includes payments under a lease, sublease, agreement of sale or loan agreement and under notes, debentures, bonds and other secured or unsecured debt obligations of any person executed and delivered to the city or its designee or assignee (including a trustee) pursuant to such lease, sublease, agreement of sale or loan agreement, but excluding the impact aid payment or administrative fee. (Ord. 337 § 3, 1986)

3.29.030 Legislative declaration of purpose.

It is determined and declared that the purpose of this chapter is to provide a method for financing the cost of economic development facilities in the city in order to provide employment opportunities and relieve conditions of unemployment and encourage the economic development of the city, thereby reducing the evils attendant upon unemployment and furthering the welfare and prosperity of the residents of the city, and any and all of the same are hereby declared and determined to be public purposes and a proper exercise of governmental function of the city. It is further determined and declared that each and every matter and thing as to which provision is made in this chapter is desirable in order to carry out and effectuate the purposes of the city in accordance with the terms of this chapter. (Ord. 337 § 3, 1986)

3.29.040 Additional powers.

In addition to other powers which it may have, the city shall have the power under this chapter:

A. To acquire by gift, purchase, lease or sublease, to construct and to finance one or more projects, whether or not now or hereafter in existence, within the city;

B. To issue its revenue bonds to defray in whole or in part the project costs of any project and to designate an appropriate name for, and all other details of, such bonds;

C. To rent, lease, sublease, sell or finance any project to any person in such manner that payments to be received with respect to the project shall produce revenues and receipts sufficient to provide for the prompt payment at maturity of principal, interest and redemption premiums, if any, upon all bonds issued to finance in whole or in part project cost of such project, and without limiting the generality of the foregoing to enter into a lease-leaseback, leveraged leasing, purchase-saleback, loan or other arrangement whereby project costs may be financed;

D. To pledge the revenues and receipts to be received from a project and its rights to bring actions and proceedings under any lease, sublease, agreement of sale, loan or other instrument for the enforcement of remedies thereunder to the punctual payment of bonds issued to finance in whole or in part project costs of such project, and the interest and redemption premiums, if any, thereon;

E. To sell and convey and project for such price and at such time whether prior or subsequent to or concurrently with the payment in full of bonds authorized under this chapter as the council may determine;

F. To issue its bonds to refund in whole or in part bonds theretofore issued under this chapter, and to extend the term of the refunding bonds beyond the term of the refunded bonds. (Ord. 337 § 3, 1986)

3.29.050 Exercise of powers.

The exercise of all powers pursuant to this chapter may be authorized by resolution of the council which may in each instance be adopted at the same meeting, either regular or special or an adjournment of either, at which it is introduced and shall take effect immediately upon adoption. (Ord. 337 § 3, 1986)

3.29.060 Bonds.

Bonds issued pursuant to this chapter may:

A. Bear interest at such rate or rates payable at such time or times;

B. Be in one or more series;

C. Bear such date or dates;

D. Mature at such time or times not exceeding 40 years from their respective dates;

E. Be payable in such medium of payment at such place or places;

F. Carry such registration privileges;

G. Be subject to such terms of redemption at such premiums or otherwise;

H. Be executed in such manner;

I. Contain such terms, covenants and conditions; and

J. Be in such form, either coupon or registered, or both, with conversion and reconversion privileges, all as may be prescribed by the resolution of the council authorizing their issuance; provided, that such resolution:

1. Need not prescribe a definitive interest rate or rates for the bonds but may instead prescribe a maximum interest rate or rates within which the bonds may be sold;

2. Need not prescribe the definitive terms upon which the bonds may be redeemed by the city but may instead prescribe minimum and maximum terms of years within which the bonds may be redeemed by the city and the minimum and maximum premiums, if any, payable in the case of such redemptions;

3. Need not prescribe the principal amount of the bonds but may instead prescribe minimum and maximum terms of years within which the bonds shall mature or be subject to sinking fund payments and minimum and maximum amounts of such principal securities or sinking fund payments; and

4. Need not designate a trustee and additional paying agents but may instead indicate whether or not a trustee and additional paying agents are to be designated and prescribe qualifications for such trustee and paying agents; provided further, that such resolution may appoint the mayor, city manager or such other official as the council deems advisable, to sell the bonds upon terms and conditions which comply with the provisions of such resolution, and all definitive terms and conditions with respect to the bonds, including the designation of a trustee and additional paying agents, if any, which are not prescribed by the resolution authorizing their issuance shall be established by the terms and conditions upon which the bonds are sold. (Ord. 337 § 3, 1986)

3.29.070 Sale of bonds.

Bonds may be sold at public or private sale at such price (which may be at par, at a premium above par or at a discount below par), in such manner and upon such terms and conditions as comply with the provisions of the resolution authorizing the issuance of the bonds, all as may be approved by the official appointed to sell the bonds or by the council if no such official be appointed. (Ord. 337 § 3, 1986)

3.29.080 Interim receipts or certificates.

Pending the preparation of the definitive bonds, interim receipts and certificates in such form and with such provisions as the council may determine may be issued to the purchaser or purchasers of bonds sold pursuant to this chapter. (Ord. 337 § 3, 1986)

3.29.090 Bonds, etc., to be negotiable instruments.

The bonds and interim receipts or certificates shall be deemed to be securities and negotiable instruments within the meaning and for all purposes of the “Uniform Commercial Code.” (Ord. 337 § 3, 1986)

3.29.100 Covenants in bonds.

Any resolution authorizing the issuance of bonds under this chapter may provide that the principal of and the interest and premium, if any, on the bonds shall be secured by an indenture of trust covering the revenues and receipts derived from the leasing, subleasing, sale or financing of the project for which the bonds are issued and such other funds and rights, if any, as are assigned and pledged under such indenture of trust. Any such resolution or indenture of trust, or any such lease, sublease, agreement of sale or loan agreement may contain such covenants and provisions as the council may determine to be advisable, including, but not limited to, covenants and provisions with respect to the project and the bonds, and the security therefor, such as to:

A. The application, use and disposition of the proceeds of the bonds and of the revenues and receipts from the project for which the bonds are to be issued, including the creation and maintenance of reserves, if any;

B. The issuance of other or additional bonds relating to the project or any construction of the project;

C. The maintenance and repair of such project;

D. The insurance to be carried thereon and the use and disposition of insurance moneys;

E. The appointment of, or the prescription of qualifications for, any bank or trust company within or outside the state of Alaska, having the necessary trust powers, as trustee for the benefit of the bondholders, paying agent, and bond registrar and the vesting in the trustee of rights, powers, duties, funds and properties for the benefit of bondholders;

F. The appointment of, or the prescriptions of qualifications for, any bank or banks or trust company or companies within or outside the state of Alaska, having the necessary trust powers, as additional paying agent or agents for the bonds and the interest thereon;

G. The investment of any funds held under such resolution or indenture of trust;

H. The terms and conditions upon which the holders of the bonds or any portion thereof, or any trustees therefor, are entitled to the appointment of a receiver; and

I. Any other matters of like or different character which in any way affect the security or protection of the bonds. Any such resolution and indenture of trust shall be enforceable by any bondholder by appropriate suit, action or proceeding in any court of competent jurisdiction, provided the resolution or indenture of trust under which the bonds are issued may provide that all such remedies and rights to enforcement may be vested in a trustee for the benefit of all the bondholders. (Ord. 337 § 3, 1986)

3.29.110 Signatures of officers on bonds – Validity of bonds.

The bonds shall bear the manual or facsimile signatures of such officers of the city as may be designated in the resolution authorizing such bonds and such manual or facsimile signatures shall be valid and binding signatures of the officers of the city, notwithstanding that before the delivery thereof and payment therefor any or all of the persons whose signatures appear thereon have ceased to be officers of the city. The validity of the bonds is neither dependent on nor affected by the validity or regularity of any proceedings relating to the construction of the project for which the bonds are issued. The resolution authorizing the bonds may provide that the bonds shall contain a recital that they are issued pursuant to this chapter, which recital shall be conclusive evidence of their validity and of the regularity of their issuance. (Ord. 337 § 3, 1986)

3.29.120 Pledge and lien of bonds.

All bonds issued under this chapter shall have a lien upon the revenues and receipts derived from the leasing, subleasing, sale or financing of the project for which the bonds have been issued to the extent such revenues and receipts are pledged pursuant to this chapter, and the council may provide in the resolution authorizing such bonds for the issuance of additional bonds to be equally and rateably secured by a lien upon such revenues and receipts or by a subordinate lien upon such revenues and receipts. (Ord. 337 § 3, 1986)

3.29.130 Limited liability for bonds.

All bonds issued under and pursuant to this chapter shall be limited obligations of the city payable solely out of the revenues and receipts derived from the leasing, subleasing, sale or financing of the project with respect to which such bonds are issued. Bonds issued under this chapter are not payable from taxes levied upon the taxable real and personal property in the city and are not a charge against the general credit or taxing power of the city. No holder of any bonds issued under this chapter shall have the right to compel any exercise of the taxing power of the city to pay the bonds or the interest or premiums, if any, thereon, and the bonds do not constitute an indebtedness of the city or a loan of credit thereof within the meaning of any constitutional or statutory provision. It shall be plainly stated on the face of each bond that it has been issued under the provisions of this chapter and that it is not payable from taxes levied upon the taxable real and personal property in the city and is not a charge against the general credit or taxing power of the city and does not constitute an indebtedness of the city or a loan of credit thereof within the meaning of any constitutional or statutory provision. (Ord. 337 § 3, 1986)

3.29.140 Exemption from construction and other requirements for public buildings.

The construction of a project shall not be subject to any requirements relating to the ownership or use by the city of buildings, structures, grounds, works or improvements, imposed by any ordinance or resolution of the city, or to any other similar requirements, and any requirement of competitive bidding or other restriction imposed on the procedure for award of contracts for such purpose or the lease, sublease, sale or other disposition of property of the city is not applicable to any action taken pursuant to this chapter. (Ord. 337 § 3, 1986)

3.29.150 Procedures established as additional and supplemental – Limitations imposed – Effect.

The procedures established by this chapter are in addition and supplemental to, and the limitations imposed by this chapter shall not affect, the exercise of powers conferred by the Charter, any law or any other ordinance. Construction of projects may be financed, and bonds may be issued under this chapter for such purposes, notwithstanding that any law or any other ordinance may provide for the financing of a like project, or the issuance of bonds for like purposes, and without regard to the requirements, restrictions, limitations or other provisions contained in any law or any other ordinance. (Ord. 337 § 3, 1986)

3.29.160 Impact aid payment or administrative fee.

The city shall require an impact aid payment or administrative fee each time that bonds are issued under the provisions of this chapter in order to enable the city to defray, in whole or in part, costs associated with the development, administration and expansion occasioned by the project. The impact aid payment or administrative fee shall not exceed one percent of the principal amount of the bonds then issued and shall be fixed by resolution adopted prior to the issuance of the bonds. The impact aid payment or administrative fee shall not constitute a part of the revenues and receipts of a project or derived from a project. (Ord. 337 § 3, 1986)

3.29.170 Contract with bondholders.

The provisions of this chapter; the resolution of the council authorizing the issuance of the bonds; the contract of sale of the bonds; any indenture of trust executed in connection therewith; and the bonds, shall collectively constitute a contract with the holder or holders of the bonds, and no subsequent change in this chapter or in any law may in any way limit the rights of the holder or holders of the bonds or alter the obligations of the city under the terms of such contract until the entire principal of and interest and redemption premiums, if any, on such bonds have been fully paid or provision for the payment thereof made in accordance with the terms of such contract. (Ord. 337 § 3, 1986)

3.29.180 Severability clause.

The provisions of this chapter, except PMC 3.29.130, are severable and if any such provisions or any sentence, clause or paragraph thereof shall be held unconstitutional or ineffective by any court of competent jurisdiction, the decision of such court shall not affect or impair any of such remaining provisions. (Ord. 337 § 3, 1986)