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Home My WebLink About2006 02_OPWA_Drinking Water SRF Loan OWRB_2006.03.06MEMORANDUM TO: HONORABLE CHAIR AND TRUSTEES OWASSO PUBLIC WORKS AUTHORITY FROM: SHERRY BISHOP FINANCE DIRECTOR SUBJECT: RESOLUTION N0.2006-02 OWRB LOAN DATE: March 3, 2006 BACKGROUND: Over the last few years, three water system improvement projects (an elevated water storage tank, main pump station and transmission line) have been identified as priorities. Vision 2025 funds have been expended to construct the water storage tank and other related water system improvements. A contract for construction of the Phase II transmission main, booster pump station and pressure plane appurtenances has been awarded to McGuire Bros. Construction Company and will be funded by a loan from the Oklahoma Water Resources Board (OWRB). OPWA Resolution No. 2006-02 authorizes a drinking water SRF loan from the OWRB for $4,853,250.00 at a fixed interest rate of 3.55%. The resolution affirms the existing security agreement, covenants, lease and sales tax pledge. The Chairman and Secretary are also authorized to execute documents and take further action as required to complete the transaction including the payment of fees and expenses. RECOMMENDATION: Staff recommends OPWA Trustee approval of Resolution No. 2006-02 approving an SFR loan from the Oklahoma Water Resources Board in the amount of $4,853,250.00 and containing other provisions relating thereto. ATTACHMENT: OPWA Resolution No. 2006-02 THE OWASSO PUBLIC WORKS AUTHORITY RESOLUTION NO. 2006-02 A RESOLUTION APPROVING AND AUTHORIZING A DRINKING WATER SRF LOAN FROM THE OKLAHOMA WATER RESOURCES BOARD IN THE TOTAL AGGREGATE PRINCIPAL AMOUNT OF $4,853,250.00; APPROVING THE ISSUANCE OF A PROMISSORY NOTE IN THE TOTAL AGGREGATE PRINCIPAL AMOUNT OF $4,853,250.00, SECURED BY A PLEDGE OF REVENUES AND AUTHORIZING ITS EXECUTION; APPROVING AND AUTHORIZING THE EXECUTION OF A LOAN AGREEMENT FOR DRINKING WATER SRF LOAN; APPROVING AND AUTHORIZING THE EXECUTION OF A SECURITY AGREEMENT; RATIFYING A LEASE, AS AMENDED BY AN AMENllMENT TO LEASE; AUTHORIZING DOCUMENTS PERTAINING TO A YEAR-TO-YEAR PLEDGE OF CERTAIN SALES TAX REVENUE; APPROVING VARIOUS COVENANTS; APPROVING AND AUTHORIZING PAYMENT OF FEES AND EXPENSES; AND CONTAINING OTHER PROVISIONS RELATING THERETO. WHEREAS, The Owasso Public Works Authority, Tulsa County, Oklahoma (the "Borrower"), was organized under Title 60, Oklahoma Statutes 2001, Sections 176-180.4, as amended, for the purpose of furthering the public functions of the City of Owasso, Oklahoma (the "City"); and WHEREAS, the Borrower is authorized and has determined to construct improvements to the Borrower's drinking water system (the "Project") in order to better serve the customers of said Borrower and in payment of part of the cost thereof, to seek money in the form of a Drinking Water SRF Loan from the Oklahoma Water Resources Board (the "Board") in the amount of $4,853,250.00; and WHEREAS, the Board has approved a loan application of the Borrower and the Borrower has determined to borrow money from the Board to accomplish the Project and to evidence such loan by the issuance of the Borrower's Series 2006 Drinking Water SRF Promissory Note to Oklahoma Water Resources Board in the original principal amount of $4,853,250.00 (the "2006 Note"), said Note being secured by a pledge of revenue derived from Borrower's water, sanitary sewer, garbage and trash collection systems and the Bailey Ranch Golf Club (hereinafter collectively the "System") and the revenue generated pursuant to a two percent (2%) sales tax received by the Borrower from the City, which sales tax is levied pursuant to Ordinance No. 103 of the City, as amended by Ordinance No. 153 of said City (the "Limited Sales Tax Revenue"); and WHEREAS, it is the desire of the Borrower to authorize the execution and delivery of any and all documents necessary or attendant to the issuance of the 2006 Note. 2 NOW, THEREFORE, BE IT RESOLVED BY THE TRUSTEES OF THE OWASSO PUBLIC WORKS AUTHORITY, TULSA COUNTY, OKLAHOMA: Section 1. Issuance of Note. The Borrower is hereby authorized to accept said loan and issue its 2006 Note payable to the Board and secured by a lien on the revenues of the System and a year-to-year pledge of the Limited Sales Tax Revenue. The officers of the Borrower are hereby authorized and directed to execute said 2006 Note and to do any and all lawful things to effect said loan and secure said loan from the Board, provided that the principal amount of the 2006 Note shall be $4,853,250.00, and the rate of interest on the 2006 Note shall be a fixed rate of interest of three and fifty-five hundredths percent (3.55%) per annum inclusive of administrative fees of one half of one percent (1 /2%). Section 2. Execution of Loan Agreement for Drinking Water SRF Loan. The Loan Agreement for Drinking Water SRF Loan by and between the Borrower and the Board (the "Loan Agreement") is hereby approved and the Chairman or Vice Chairman and Secretary or Assistant Secretary of the Borrower are hereby authorized to execute same for and on behalf of the Borrower, and to do all other lawful things to carry out the terms and conditions of said Loan Agreement. Section 3. Execution of Securit~greement. The Security Agreement by the Borrower in favor of the Board (the "Security Agreement"), whereby the Borrower gives a lien on the revenues of the System and a lien on the Limited Sales Tax Revenue to the Board to secure payment of the 2006 Note is hereby approved and the Chairman or Vice Chairman and Secretary or Assistant Secretary are hereby authorized to execute same for and on behalf of the Borrower, and do all other lawful things to carry out the terms and conditions of said Security Agreement. Section 4. Covenants of Borrower. Until payment in full of the 2006 Note and performance of all obligations owing to the Board under the Loan Agreement and the instruments executed pursuant hereto, unless the Board shall otherwise consent in writing, the Borrower hereby represents its intent to abide by and carry out the covenants contained in the Security Agreement and the Loan Agreement, which covenants are incorporated herein in their entirety. Section 5. Lease. The Lease dated July 31, 1973, as amended by an Amendment to Lease dated as of July 1, 1996, between the City of Owasso, Oklahoma, and the Borrower, whereby the City leased its water, sanitary sewer, garbage and trash collection systems and the Bailey Ranch Golf Club to the Borrower, is hereby ratified and confirmed and the term of said Lease, as amended, shall extend until the 2006 Note is paid. Section 6. Sales Tax Pledge. That the Chairperson or Vice Chairperson and Secretary or Assistant Secretary of the Borrower be and are hereby authorized to execute and deliver any and all documentation on behalf of the Borrower pertaining to the year-to-year pledge of the Limited Sales Tax Revenue for purposes of securing the 2006 Note. Section 7. Fees and Expenses. Upon closing of the referenced loan, the officers of the Borrower are hereby authorized to disburse (from loan proceeds or other available funds of the Borrower) those fees and expenses set forth on Exhibit "A" hereto, together with such other fees 3 and expenses as will be set forth on the Borrower's Closing Order to be executed in connection with the closing of the financing referenced herein. Section 8. Necessary Action. The Chairman or Vice Chairman and Secretary or Assistant Secretary of the Borrower are hereby further authorized on behalf of the Borrower to accept, receive, execute, attest, seal and deliver the above mentioned documents and all additional documentation, certifications and instruments and to take such further actions as may be required in connection with the transactions contemplated hereby, and are further authorized to approve and make any changes to the documents approved by this Resolution, for and on behalf of the Borrower, the execution and delivery of such documents being conclusive as to the approval of any terms contained therein. [Remainder of Page Left Blank Intentionally] n 4 ADOPTED AND APPROVED THIS 6TH DAY OF MARCH, 2006. ATTEST: Secretary (SEAL) `,```J~~,C ~WO~ ~~'~i .. , •0 9~ y S~ ~ Q = . ~ O ~ • ~~ i ~ ti ~~ ~~ ! ~~ ~~~i~~A 'OMP ~~`~ THE OWASSO PUBLIC WORKS AUTHORITY an