Chapter 3.24
LOCAL IMPROVEMENTS –
GUARANTY FUND*

Sections:

3.24.010    Maintenance and operation of the guaranty fund – General.

3.24.020    Minimum balance prescribed for the guaranty fund.

3.24.030    Use of guaranty fund to pay local improvement district obligations.

3.24.040    Use of guaranty fund to pay arbitrage rebate.

3.24.050    Ordinance supersedes Ordinance No. 85.

3.24.010 Maintenance and operation of the guaranty fund – General.

The city shall maintain and operate its guaranty fund in accordance with the laws contained in Chapter 35.54 RCW and such other laws that specifically or generally apply to the guaranty fund, as the same may be amended from time-to-time. Obligations guaranteed by the guaranty fund shall include, in addition to those obligations referred to in Chapter 35.54 RCW, obligations issued under Chapter 39.50 RCW in anticipation of the issuance of local improvement district bonds. (Ord. 2263 § 1, 1999 – Superseding Ord. 85 § 1, 1961)

3.24.020 Minimum balance prescribed for the guaranty fund.

The city shall maintain a balance in the guaranty fund during each calendar year that is at least equal to five percent of the principal amount of outstanding local improvement district bonds, warrants, notes and other obligations guaranteed by the guaranty fund. Should that balance fall below the required five percent, the city covenants to restore the balance on the guaranty fund to the required amount during the next fiscal year of the city, subject only to the limitations of RCW 35.54.060. Notwithstanding the foregoing, the city council may, with respect to the obligations issued on account of any local improvement district, require by ordinance that the minimum balance in the guaranty fund on account of such obligations be greater than is required by the first sentence of this section. (Ord. 2263 § 2, 1999 – Superseding Ord. 85 § 2, 1961)

3.24.030 Use of guaranty fund to pay local improvement district obligations.

Supplementing Chapter 35.54 RCW and to prevent an anticipated default, if, prior to an interest payment date of obligations secured by the guaranty fund, the city finance director (or other city official then responsible for overseeing the city’s funds and accounts) determines that there is insufficient money in the local improvement fund or other fund or account established to pay debt service on those obligations to pay the interest or principal and interest scheduled to come due on that interest payment date, then the city finance director (or other city official then responsible for overseeing the city’s funds and accounts) shall withdraw from the guaranty fund and apply an amount sufficient to pay that deficiency on that interest payment date. To the extent the amount available in the guaranty fund on such interest payment date is not sufficient to cure the deficiency, the city finance director (or other city official then responsible for overseeing the city’s funds and accounts) shall issue interest-bearing warrants drawn on the guaranty fund as prescribed by statute. (Ord. 2263 § 3, 1999 – Superseding Ord. 85 § 3, 1961)

3.24.040 Use of guaranty fund to pay arbitrage rebate.

To the extent that the city is required by Section 148 of the Internal Revenue Code of 1986, as amended, or any successor federal law, to make arbitrage rebate payments to the U.S. Treasury on account of the investment of the guaranty fund, such payments may be made from amounts on deposit in the guaranty fund. The city may establish subaccounts within the guaranty fund from time-to-time, if necessary or desirable for purposes of accounting for the investment of money therein. (Ord. 2263 § 4, 1999 – Superseding Ord. 85 § 4, 1961)

3.24.050 Ordinance supersedes Ordinance No. 85.

The ordinance codified in this chapter shall supersede Ordinance No. 85, but shall not deprive any owner of a local improvement district obligation heretofore issued of any rights vested under Ordinance No. 85. (Ord. 2263 § 4, 1999 – Superseding Ord. 85 § 4, 1961)