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HomeMy WebLinkAbout12-04-1961 Adjourned Regular Meeting1 R MINUTES OF A MEETING OF THE MAYOR AND CITY COUNCIL OF THE CITY OF FAIRHOPE, ALABAMA, HELD ON DECEI4BER 4. 1961 The Mayor and City Council of the City of Fairhope, Alabama, met in adjourned regular s ession at the City Hall in said city on December 4, 1961, at 7:30 otclock, P.M., pursuant to adjournment of the adjourned regular meeting of the Mayor and City Council held on November 2.8, 1961, which had been in turn adjourned from the regular meeting of November 27, 1961. On roll call the following were found to be present: Mayor Joe Schneider and the following members of the City Council: Lester I. Boone, James E. Gaston, Jr., William J. Nelson, and Walter 0. Poser and Alton E. Schermer. The following were found to be absent : None . The mayor presided as chairman of the meeting, and Marie Moore, the city clerk, who7iwas also present, acted as clerk of the meeting. The mayor declared that a quorum was present and the meeting open for the transaction of business. The minutes of the preceding meeting were read and approved. The following ordinance was introduced in writing by Councilman Gaston and read to the meeting: W ORDINANCE NO. AN ORDINANCE TO PROVIDE FOR THE ISSUANCE OF AND SALE OF $l,000,000 PRINCIPAL AMOUNT OF WATER, GAS AND SEWER REVENUE BONDS, SERIES 1961, OF THE CITY OF FAIRHOPE, ALA- BAMA, FOR THE PURPOSE OF REFUNDING CERTAIN REVENUE BONDS OF THE CITY AND DEFRAYING THE COST OF CONSTRUCTING IMPROVEMENTS TO THE CITY'S WATER WORKS AND SANITARY SEWER SYS- TEM AND ITS NATURAL GAS DISTRIBUTION SYSTEM AND TO PROVIDE FOR A TRUST INDENTURE AS SECURITY THEREFOR BE IT ORDAINED by the Mayor and City Council (here- in together called "the governing body") of the City of Fairhope (herein called "the city") in the State of Alabama as follows: Section 1. Findings. The governing body of the city has ascertained and fou—n-T and does hereby declare and recite as follows: (a) It is necessary and desirable in the best interests of the city and its inhabitants that the city construct certain capital improvements to its water works and sanitary sewer system (herein called "the water and sewer system") and its natural gas distribution system (herein called "the gas system"), said capital improvements to the water and sewer system being briefly described as follows: A new ?;:0000-00 gallon steel elevated tank, with water p ppelines connecting it to the existing water distribution system, and the said capital improvements to the gas system being briefly described as follows: A new gas supply line extending from the point of delivery from United Gas Com- pany's main to the gas distribution sys- tem of the city, and additional gas line extensions and service connections to approximately 200 new customers; (b) The city has employed qualified engineers for the purpose of ascertaining the costs of construction of said capital im- provements, and the said engineers have estimated that the total costs of constructing all of the said extensions and im- provements and of paying the incidental expenses estimated to be incurred in connection with said construction with the issuance of the bonds hereinafter authorized will be not less than $652,54 .00 , and the governing body hereby adopts the aforesaiesimate of costs; (c) In order to effectuate the financing of the said capital improvements it will be - 2 - necessary and it is in the best interests of the city that its outstanding First Mortgage Gas Revenue Bonds dated February 1, 1950, numbered 159 to 494, inclusive, aggregating $336,000 in principal amount (herein called "the 1950 gas bonds") be refunded by retirement thereof on February 1, 1962, such retirement to be effected by payment at maturity of those having a stated maturity on February 1, 1962, and by redemption of those having a stated maturityefter that date; (d) The amount required to be applied, from the proceeds of the bonds herein- after authorized, for retirement of the 1950 gas bonds on February 1, 1962, is $ 347�455.00 , including the princi- pal of the 1950 gas bonds and the redemption premium with re- spect to those having a stated maturity after February 1, 1962; and (e) In order to raise funds to refund the 1950 gas bonds and, to_pay the costs of constructing the said capital improve- ments, it will be necessary that the city issue and sell its bonds hereinafter authorized in anticipation of the revenues that will be derived from the operation of the water and sewer system and the gas system (herein together called "the systems"); (f) The period of usefulness of the said capital improvements is hereby estimated to be in excess of thirty years from Decem- ber 1, 1961; (g) The useful life of each of the systems is hereby estimated -to be in excess of thirty years from December 1, 1961; and (h) The reserves provided for in Sections 9.6 and 9.7, respectively, of the trust indenture authorized in Section 8 hereof (said trust indenture being herein called "the inden- ture'") constitute reasonable reserves respectively for payment of the principal of and the interest on all bonds that may be issued under the indenture and for capital improvements, betterments and extensions to the systems, and the periods of time provided for in said sections respectively constitute reasonable periods within which such reserves shall be built up. Section 2. Authorization of Series 1961 Bonds. Pur- suant to the provisions of Subdivision 3 of Ar is e of Chapter 6 of Title 37 (Sections 308 to 340, inclusive) of the Code of Alabama of 1940, as amended, and for the purpose of refunding the 1950 gas bonds and defraying the costs of con- structing the aforesaid capital improvements to the systems and of paying the incidental expenses to be incurred in connec- tion therewith and in connection with the issuance of the bonds herein authorized, there are hereby authorized to be issued $1,000,000 principal amount of dater, Gas and Sewer Revenue Bonds, Series 1961, of the city, to be dated December 1, 1961 (herein called "the bonds"). The bonds shall contain such provisions and shall be payable at such times and places as are specified in the indenture. Section 3. Source of Payment; Pledge. The principal of and the interest on the bonds, and any additional bonds that may be issued under the provisions of the indenture, shall be payable solely from the revenues derived from the operation of the systems, including all additions thereto and extensions thereof that may hereafter be made, which said revenues are, to the extent provided in the indenture, hereby specially and irrevocably pledged for payment of the principal of and the interest on the bonds and said additional bonds, pro rata and without preference or priority of one over another by reason of prior issuance or otherwise. The general faith and credit of the city are not pledged to the payment of the bonds and the coupons, and they shall not be general obligations of the city. Neither this ordinance nor the indenture nor any of the bonds or the coupons shall be deemed to impose upon the city any obligation to pay the principal of or the interest on the bonds and the coupons except with the moneys directed to be paid into the Water, Gas and Sewer Bond and Interest Redemption Fund created in Article IX of the indenture, and the bonds and the coupons shall.not constitute indebtedness of the city within the meaning of any state constitutional provisions.or statutory limitation. None of the agreements, representations or warranties made or implied in this ordinance, or in the issuance of the bonds and the coupons, shall ever impose any personal, pecuniary or general liability or charge upon the city, whether before or after any breach by the city of any such _agreement, representation or warranty of the city, except with the moneys herein provided. Nothing contained in this section shall, however, relieve the city or its officers from the performance of the several agreements and represen- tations on the part of the city.contained in this ordinance o long as such performance does not impose a personal, pecuniary or general liability or charge upon the city.,.No bonds, other than the bonds authorized to be issued by this ordinance and the additional bonds authorized to,be issued from time to time by the city under the provisions of the , indenture, shall be deemed of the same issue as the bonds or said additional bonds or shall be entitled to„payment from the same fund out of which the bonds and said additional bonds are payable, even though such bonds are issued for the purpose of providing funds for the amount of any deficit in the moneys available to defray the costs of acquiring and constructing the capital improvements described in Section 1 of this ordinance. Section 4. Gross- Revenue Accounts. The gross revenues der.ive.d from opera ion .of the water and sewer sys- tem and the gas system shall be deposited,by the city, daily as collected by it, into the several gross revenue accounts (herein'called "the underlying revenue accounts") created in that certain mortgage and deed of trust by The Water Works and Sewer Board of the City of Fairhope (herein called "the board") to The Merchants National Bank of Mobile dated ,as Of July 1, 1950, that certain mortgage and deed of trust by the board to the said bank dated as of July 1, 1953, and that certain mortgage and deed of trust by the city to the said bank dated as of December 1,'1958.(the said three mort- gages and deeds. of trust being herein together called "the underlying indentures") . Following satisfaction .and ,,dis- charge of all of the underlying indentures, the revenues derived from operation of the water and sewer system and, following satisfaction and discharge of that one of the underlying indentures dated as of December 1, 1958, the gross revenues derived from operation of the gas system shall be deposited by the city, daily as collected by it, into the Water, Sewer and Gas Revenue Account (herein called "the revenue account") created in Article IX of the indenture. The city will make transfers of moneys from the underlying revenue accounts and from the revenueaccount pursuant to the provisions of the said Article IX of the indenture, at the times and to the respective extents therein provided and to the extent that the moneys on deposit in the underlying revenue accounts or the revenue account, as the case may be, shall be available therefor. Section 5. Maintenance of Rates. The. governing body of.the city covenants and agrees to maintain such rates and charges for water and sanitary sewer service furnished by the water and sewer system and gas,furnished by the gas system as shall be sufficient to provide for payment of the principal of and the interest on the bonds as and when the same become due and payable, to create a bond and interest redemption fund therefor,'to`provide for payment of the ex- penses of administering and operating the systems and. of maintaining them in good repair and working order, to build up, a.reserve for depreciation of'the systems and to build up a reserve for'improvements, betterments and extensions to the systems other than those necessary to maintain'the same in good repair and working order as hereinabove"provided. The governing body of the city hereby orders and determines that the systems shall be operated on the basis of a fiscal year commencing on October 1 of each calendar year and ending on September 30 of the following calendar year. Section 6. Bonds Payable at Par". All remittances of principal of and interest on The onds and the coupons applicable thereto shall be made to the holders thereof at par without deduction for exchange or other costs, fees or expenses. The bank or banks at"which the bonds or the said coupons shall at any time be payable shall be considered, by acceptance of their duties hereunder, to have agreed that they will make or cause to'be made, out of the moneys sup- plied, to them for that purpose, remittances of the, principal and the interest on the bonds and*the said coupons to the holders thereof in bankable funds at par without any deduc- tion for exchange or other costs, fees or expenses. "The city will pay to such bank or banks all reasonable charges made and expenses incurred by them in making such remittances in bankable funds at par. Section 7. This Ordinance a Contract. The provi- sions of this ordinance shall constitute a con ract between the city and"each holder of -the bonds and the coupons. Section 8. Trust Indenture Authorized. As addi- tional security for payment of the principa of and the interest on the bonds and any additional bonds that -may be issued under the indenture, pro"rata and without preference or priority of one bond over another; the mayor of -the city is hereby authorized'and directed to execute and deliver, for and in the name and°behalf of the city, to The Merchants National Bank of Mobile, a trust indenture in substantially the form presented to the governing.body at*the meeting thereof at which this ordinance is adopted, which form, marked Exhibit'"A", shall`be attached to the minutes of the meetingr;at which,, this ordinance is adopted and which is hereby adopted and made a part of this ordinanceRin all respects as if -herein set out in full herein; and the city clerk.of the city is hereby authorized and directed to affix the corporate seal of the city to the indenture and to attest the same. Section 9. Sale of the Bonds. The bid of Hugo Marx & Co. and Associates for the bonds at a net interest cost to the city of 3.9790 , said bid resulting in a pur- chase price equal to 100.04642% of the face value of the bonds, vix., the sum of $1,900,464.20, plus accrued inter- est on the bonds from December 1, 1.961, to the date of - 5 - e the it delivery, is hereby declared to be the highest and best bid received by the city for the bonds. The said bid is hereby accepted and the bonds are hereby sold to the said bidders at and for said purchase price. The mayor of the city is hereby author- ized and directed to execute each of the bonds in the name of the city by subscribing his manual signature on each of the bonds, and the city clerk is hereby authorized and directed to affix to each of the bonds the seal of the city and to execute each of the bonds with her facsimile signature, the said facsimile signa- ture of the city clerk on each of the bonds to constitute attest- ation of such bond and of the seal so affixed. The mayor is hereby authorized and directed to deliver the bonds, when so executed, sealed and attested, to the said purchasers upon payment to the city of the said purchase price. Adopted and approved this day of December, 1961. (. 2ZZ'_: 2 1 Z / Mayor Authenticated: City Clerk Councilman Boone moved that the rules be suspended and that unanimous consent be given for immediate consideration of and action on said Ordinance, which motion was seconded by Councilman Nelson, and upon the motion being put to vote the following vote was recorded: Yeas: Mayor Schneider and Councilmen Boone, Gaston, Nelson and Poser. Nays: Councilman Schermer. The mayor thereupon declared that the motion for unanimous consent for the immediate consideration of and action on said ordinance had been defeated and ordinance was carried over to the next regular meeting of the council for passage, The following resolution was then introduced in writing by Councilman Poser I and read to the meeting: A RESOLUTION PROVIDING FOR NOTICE OF PASSAGE OF THE CITY'S ORDINANCE NO BE IT RESOLVED by the -Mayor and City Council of the City of Fairhope, Alabama, that in=order to comply with the requirements of Section 340 of Title 37 of the Code of Alabama of 1940, as amended, the city clerk of the said city is hereby authorized and directed to cause a copy of the following notice to be published in The Fairhope Courier, a newspaper published and having general circulation wit in the corporate limits of said city, once a week for two con- secutive weeks: NOTICE OF PASSAGE•OF ORDINANCE OF TEE CITY OF FAIRHOPE, ALABAMA An ordinance authorizing the issuance of $1,000,000 principal amount of Water, Gas and Sewer Revenue Bonds, Series 1961, of the City of Fairhope, Alabama, under the provisions of Title 37, Chapter 6, Article 2, Subdivision 3, of the Code of Alabama of 1940, as amended, was duly passed by the Mayor and City Council of the City of Fairhope, Alabama, on the 4th day of December, 1961, for the purpose of pro- viding funds necessary to refund the city's outstanding First Mortgage Gas Revenue Bonds dated February 1, 1950, and to construct capital improvements to the water works and sanitary sewer system and the natural gas distribution system of said city, and payment of incidental costs in connection therewith. The said bonds authorized to be issued, as aforesaid, will be secured by a pledge of revenues derived from the operation of the said water works and sanitary sewer system and the said natural gas distribution system of the city. Any action or proceeding question- ing the validity of the said ordinance must be commenced within thirty days after the first publication of this notice. /s/ Marie Moore City Clerk Adopted and approved this 4th day of December, 1961. Mayor Authenticated: vi ty er - 7 - )19 Councilman Gaston moved that the rules be suspended and that unanimous consent be given for immediate consideration of and action on said resolution, which motion was seconded by Council- man Poser, and upon the motion being put to vote the following vote w as recorded: Yeas: Mayor Schneider and Councilmen Boone, Gaston, Nelson and Poser; Nays: Councilman Schermer. The mayor thereupon declared that the motion for unanimous consent for the immediate consideration of and action on said Resolution had been defeated and resolution was carried over to the next regular meeting of the council for passage, Councilman Nelson introduced the following resolution in writing, which was read to the meeting: BE IT RESOLVED by the Mayor and City Council of the City of Fairhope, Alabama, that the proceeds from the sale of the city's Water, Gas and Sewer Revenue Bonds, Series 1961, aggregating $1,000,000 in principal amount, which were authorized to be issued by Ordinance No. of the city adopted December , 1961, shall be deposited to the credit of the city in a separate Clearance Account in The Merhhaftts National Bank of Mobile, in Mobile, Alabama; that the funds so deposited May be withdrawn by checks, vouchers, or drafts signed in the name of the city by its treasurer and countersigned by its mayor; and that said bank is hereby authorized, until further notice to it by a certified copy of a resolution adopted by the govern- ing body of the city and delivered to the said bank, to honor any such checks, vouchers, or drafts when so signed and counter- signed regardless of the person or persons to whom the same may be payable. Councilman Poser moved that the foregoing resolution be adopted, w hich motion was seconded by Councilman Gaston, and upon the same being put to vote the following vote was recorded: Yeas: Mayor Schneider and Councilmen Boone, Gaston, Nelson and Poser. Nays: None. Councilman Schermer not voting. The mayor thereupon declared the resolution had been duly adopted. -8- )0 Councilman Boone then introduced the following resolution which was read to the meeting: A RESOLUTION APPOINTING DEPOSITORIES FOR A SPECIAL ACCOUNT AND A SPECIAL FUND CREATED IN TRUST INDENTURE OF THE CITY OF FAIRHOPE, ALABAMA, TO BE DATED AS OF DECEMRml ,_1961 BE IT RESOLVED by the City Council of the City of Fairhope (herein called "the city") in the State of Alabama as follows: (1) The Bank of Fairhope a banking institution in Fairhope Alabama, is hereby appointed as depository for the Water, Sewer and Gas Revenue Account created in Section 9.2 of the trust indenture between the city and The Merchants National Bank of Mobile, the trustee thereunder, to be dated as of December 1, 1961, which was authorized in Ordinance No. of the city adopted December , 1961; (2) The Bank of a banking institution in Alabama, is hereby appointed as d and Gas Operation and Maintenance of the said trust indenture; airnope Fairhope epository for the Water, Sewer Fund created in Section 9.5 (3) Any and all funds of the city at any time on deposit in said acccunt or in said fund may be withdrawn by checks, vouchers, or drafts signed in the name of the city by its treasurer and countersigned by its mayor,or signed by either the mayor or the city treasurer and countersigned by a member of the city council of the city;and each bank named herein is hereby author.. ized, until receipt by it of further notice in the form of a certified copy of a resolution adopted by the governing body of the city, to honor any such checks, vouchers, or drafts when so signed regardless of the person or persons to whom the same may be Payable. Adopted and approved this 4th day of December, 1961. c Mayor Authenticated: City Clerk Councilman Gaston moved that the rules be suspended and that unanimous consent be given for immediate consideration_ of and action on said resolution, which motion was seconded by Council- man Poser and upon the motion being put to vote the following vote was recorded: Yeas: Mayor Schneider and Councilmen Boone, ./ Gaston, Nelson,,Poser and Schermer. Nays; None. The mayor thereupon declared that the motion for unanimous consent for the immediate consideration of and action on said resolution had been unanimously carried. Councilman Boone thereupon moved that the " said resolution be finally adopted, which motion was seconded by Councilman Nelson, and upon the motion being put to vote the following vote was recorded: Yeas: Mayor Schneider and Council.. men Boone, Gaston, Nelson, Poser and Schermer. Nays: None. The Mayor thereupon announced that the motion for adoption of said resolution had been unanimously carried and he then signed the same. Councilman Schermer left the meeting at 8:55 P.M. due to illness. There being no further business to come before the meeting, the same was on motion duly made, seconded, and unanimously adopted, adjourned, Mayor City Clerk ..10N 5J �l