Chapter 3.64


3.64.010    Contract authorization.

3.64.010 Contract authorization.

A.    The city finance director is authorized to negotiate and enter into contracts for the sale of short-term obligations as authorized by Chapter 39.50 RCW up to the maximum of the then estimated costs and expense of each local improvement district. Such obligations may bear a fixed rate or rates or a variable rate or rates of interest which may be based on a bank prime rate or the most recent prime rate of interest published in the Wall Street Journal but in any event shall not exceed a net effective interest rate of fifteen percent per annum. Such short-term obligations shall be dated as of the date of their issuance and shall not be outstanding for longer than three years. Such short-term obligations shall be registered if so required in order to exempt the interest thereon from federal income taxation, and the city finance director may designate the registrar depending on the volume of certificates required.

B.    The short-term obligations may be paid from the proceeds of local improvement district bonds or consolidated local improvement district bonds, from assessment payments, from the proceeds of the issuance of other short term obligations or from other city funds legally made available for that purpose. The short-term obligations shall be drawn on the local improvement fund created for the applicable local improvement district and, unless otherwise permitted by law, shall be payable solely out of that fund or the local improvement guaranty fund of the city.

C.    The short-term obligations may be subject to prior redemption, may be sold at a discount, at par, or at a premium and shall be in such denominations and bear such other covenants respecting payment as the city finance director may determine. Both principal of and interest on the short-term obligations shall be payable in lawful money of the United States of America at the office or offices of the registrar.

D.    The finance director may designate the short-term obligations as qualified tax-exempt obligations for the purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended.

E.    The city council finds and determines that the maximum rate of interest and the standards for the index for the variable interest rates established in this chapter are in the best interest of the city. (Ord. 1496 § 1, 1990).