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HomeMy WebLinkAboutResolutions - 1979.02.01 - 12288-c0 February 1, 1979 RESOLUTION NO. RE: AUTHORIZATION TO BORROW AGAINST ANTICIPATED DELINQUENT 1978 TAXES BY: FINANCE COMMITTEE TO: THE OAKLAND COUNTY BOARD OF COMMISSIONERS MR. CHAIRMAN, LADIES AND GENTLEMEN: WHEREAS, on March 1, 1973, this Board of Commissioners adopted a resolution establishing the Oakland County Delinquent Tax Revolving Fund, pursuant to Section 87b of Act No.. 206 of the Public Acts of 1893, as amended; and WHEREAS, this Fund has been designated as the "100% Tax Payment Fund" by the Oakland County Treasurer, and it appears desirable to borrow to fund part of said Fund for the 1978 delinquent real property taxes; and WHEREAS, the purpose of this Fund is to allow the Oakland County Treasurer (hereinafter sometimes referred to as the "County Treasurer" or the "Treasurer") to pay from the Fund any or all delinquent real property taxes which are due the County; any school district; intermediate school district; community college district; city, township, special assessment or drain district; or any other political unit or county agency for which delinquent tax payments are due on settlement day with the county, city or township treasurer and has been heretofore directed to do so by - this Board of Commissioners; and t 8774 WHEREAS, it is hereby determined that it is necessary that Oakland County (hereinafter sometimes referred to as the "County") borrow a sum not to exceed (a) the amount of the 1978 delinquent real property taxes (hereinafter sometimes referred to as the "delinquent taxes") which become delinquent on or before March 1, 1979, and (b) a reserve to assure prompt payment of the notes, and deposit the proceeds thereof in the aforesaid Fund and the Note Reserve Fund respectively; and WHEREAS, such borrowing is authorized by Sections 87e and 87d of Act No. 206 of the Public Acts of 1893, as amended (hereinafter referred to as "Act 2061; and WHEREAS, the total amount of unpaid delinquent taxes which will be outstanding on March 1, 1979 is estimated to be in excess of $29,000,000, exclusive of interest, fees and penalties. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE COUNTY OF OAKLAND as follows: 1. The County shall borrow Thirty-two Minion Dollars ($32,000,000) or such part thereof as will repr2sent not to exceed (a) the exact amount of the dePnquent taxes outstanding on March 1, 1979, exclusive of interest, fees and penalties, and (b) an amount not to exceed fifteen percent (15%) of the amount of the delinquent taxes, in order to constitute a reserve (hereinafter referred to as the "Note Reserve Fund"), and, as the Municipal Finance Commission may authorize, issue its "General Obligation Limited Tax Notes, Series 1979", payable from the delinquent taxes outstanding on March 1, 1979 and the other sources specified below, the proceeds of which notes shall be placed in and used as the whole or part of the County's 100% Tax Payment Fund Account No. 46196 and the Note Reserve Fund, to be used as provided in Act 206. The exact borrowing amount will be designated by the County Treasurer after the amount of the 1978 delinquent taxes are determined, which designation will specify the amount to be allocated to the Note Reserve Fund. 2. The said notes shall bear interest payable November 1, 1979, May 1, 1980 and each November 1 and May 1 thereafter until maturity, which interest is not to exceed eight and three-quarters percent (8 3,/4%) per annum. Said notes shall be coupon notes issued in denominations of $5,000 each and shall be numbered from 1 upwards, beginning with their earliest maturities in the direct order of their maturities. The notes shall be dated April 1, 1979 and shall be due and payable as follows: $9,000,000 on May 1, 1980; $9,000,000 on May 1, 1981, and not to exceed $14,000,000 on May 1, 1982. 3. There is hereby established the County's 100% Tax Payment Fund Collection Account No. 46196 (hereinafter referred to as the "Collection Account"), effective as of March 1, 1979, into which Account the County Treasurer is hereby directed to place on the books and records all of the following payments received on account of the delinquent taxes: a. All of the delinquent taxes collected on and after March 1, 1979 and all interest thereon. b. All of the collection fees on the delinquent taxes once the expenses of this borrowing have been paid. c. Any amounts which are received by the Treasurer from the taxing units within the County because of the uncollectability of the delinquent taxes. The amounts specified in this paragraph are hereby designated as the "Funds Pledged to Note Repayment". 4. There is hereby established the "Note Reserve Fund", into which Fund the Treasurer shall deposit all of the proceeds of the sale which are borrowed for the purpose of establishing the Note Reserve Fund. 5. All money in the Note Reserve Fund, except as hereafter provided, shall be added to the Funds Pledged to Note Repayment and shall be used solely for payment of principal and interest on the notes for which the fund was established, or the purchase of notes for which the fund was established. Money in the Note Reserve Fund shall first be withdrawn for payment of principal and interest on notes before other county general funds are used to make the payments. All income or interest earned by, or increment to, the Note Reserve Fund due to its investment or reinvestment shall be deposited in the Delinquent Tax Revolving Fund, when the notes for which the fund was established are retired. When the Note Reserve Fund is sufficient to retire the notes and accrued interest thereon, it may be used to purchase the notes on the market or, if notes are not available, to retire the notes when due. 6. The following are hereby pledged to the repayment of the notes and shall be used solely for repayment of the notes until the notes and all interest thereon are paid in full: a. All of the Funds Pledged to Note Repayment; b. All of the Note Reserve Fund; and c. Any interest earned on any money from either the Funds Pledged to Note Repayment or the Note Reserve Fund. 7. This note issue, in addition, shall be a general obligation of the County of Oakland, secured by its full faith and credit, which shall include this County's limited tax obligation, within applicable constitutional and statutory limits, and its general funds. The county budget shall provide that if the pledged delinquent taxes and any other pledged amounts are not collected in sufficient amounts to meet the payments of the principal and interest due on these notes, the County, before paying any other budgeted amounts, will promptly advance from its general funds sufficient money to pay that principal and interest. If the proceeds of the delinquent taxes, pledged interest and collection fees or Note Reserve Fund are not sufficient to pay the principal and interest when due, the County shall pay the same, as provided in this paragraph, and may thereafter reimburse itself from the delinquent taxes collected. 8. The County shall not have the power to levy any tax for the payment of the notes in excess of its statutory limits. 9. The County Treasurer, pursuant to Section 87c, subsection 3 of Act 206, is hereby designated as Agent for the County, and the County Treasurer and the Treasurer's office shall respectively receive such sums as are therein provided for the services as Agent for the County and to cover administrative expenses. 10. The County Treasurer shall use the proceeds of the borrowing (except that part to be used for the Note Reserve Fund) to continue the County's 100% Tax Payment Fund and shall pay therefrom the full amount of the delinquent taxes delivered by any tax collector in the County which is outstanding and unpaid on or after March 1, 1979, as required by Act 206, together with the expenses of this borrowing, unless the same are paid out of the collection fees. 11. The expenses of borrowing in connection with this issuance of notes shall be repaid from the collection fees collected on the delinquent taxes. 12. After a sufficient sum has been set aside for the purpose of paying the aforesaid notes and the interest thereon: (a) any further collection of the aforesaid delinquent taxes may be used to pay any or all delinquent taxes which are due and payable to the County; any school district; intermediate school district; community college district; city, township, special assessment or drain district; or any other political unit for which delinquent tax payments other than for the year 1978 are due on settlement day with the county, city or township treasurers and (b) all income or -5- Interest earned by, or increment to, the Note Reserve Fund due to its investment or reinvestment shall be deposited in the Delinquent Tax Revolving Fund. 13. The notes of each maturity shall be payable to bearer in lawful money of the United States of America at such bank or trust company in the State of Michigan as shall be designated by the original purchaser or purchasers and the notes and coupons shall be substantially in the form attached hereto and hereby approved and adopted. A co-paying agency located either in Michigan or elsewhere in the United States of America may also be designated by such purchaser. The Treasurer shall have the right to approve or name such paying agent or agents as set forth in the Notice of Sale attached hereto. 14. The notes shall not be subject to redemption prior to maturity. 15. The County Treasurer is hereby authorized and directed to execute the notes for the County. The Treasurer is thereafter authorized and directed to deliver the notes to the purchaser upon receipt of the purchase price, which delivery may be made in the discretion of the Treasurer at one time or in parts at various times, provided that the notes with the earliest maturities shall be all delivered prior to any notes with later maturities, and provided furthet that all deliveries shall be completed by August 15, 1979. The coupons affixed to the notes shall be executed with the facsimile signature of the County Treasurer, the notes shall be sealed with the county seal, and the coupons shall contain the following notation: "This coupon is payable only from the following sources: certain delinquent real property taxes, the interest thereon, a part of the collection fees thereon, moneys on deposit in a certain Note Reserve Fund and other amounts, all as described in the note to which this coupon pertains." 16. The County Treasurer is hereby authorized to make application to the Municipal Finance Commission on behalf of the County for an Order permitting this -6-- County to make this borrowing and issue its General Obligation Limited Tax Notes, Series 1979. 17. The County Treasurer shall conduct a public sale of the notes (after insertion of the Notice attached to this resolution and as provided in paragraph 18 hereof), provided such notes shall not be sold at a discount, after which sale the Treasurer shall award the notes to the lowest bidder. The conditions of sale shall be as specified in said Notice. 18. Sealed proposals for the purchase of the notes shall be received up to such time as shall later be determined by the Treasurer and notice thereof' shall be published in accordance with law once in the Bond Buyer, which is hereby designated as being a publication printed in the English language and circulated in this State, which carries as a part of its regular service notices of sale of municipal bonds. The Notice shall be in substantially the form in the attachment to this resolution. 19. The notes shall be delivered with the unqualified opinion of Dickinson, Wright, McKean, Cudlip & Moon, Attorneys of Detroit, Michigan, approving the legality of the notes, and the cost of said legal opinion and the printing of the notes - will be at the expense of the County. The notes will be delivered at the expense of the County in such city or cities designated by the Treasurer in the Notice of Sale. 20. Notwithstanding any other provision of this resolution or other resolutions adopted heretofore, the County hereby covenants with the purchaser (within the meaning of Sections 1.103-13, L103-14 and 1.103-15 of the Proposed Income Tax Regulations prescribed by the Commissioner of Internal Revenue) of the General Obligation Limited Tax Notes, Series 1979, that the County will make no use of the proceeds of the notes which, if such use had been reasonably expected on the date of issue of the notes, would have caused the notes to be "arbitrage bonds", as defined in Section 103(c) of the Internal Revenue Code of 1954, as amended, and all rules and regulations thereto. -7- 21. The County further covenants that it will not permit at any time any of the proceeds of the General Obligation Limited Tax Notes, Series 1979, or any other funds of the county to be used directly or indirectly in a manner which would result in the exclusion of of said notes from the treatment afforded by Section 103(a) of the Internal Revenue Code of 1954, as amended, by reason of the classification of the notes as "Industrial Development Bonds" within the meaning of Section 103(b) of the Internal Revenue Code of 1954, as amended, and all rules and regulations relating thereto. 22. The County Treasurer shall keep full and complete records of all deposits to and withdrawals from each of the following funds and accounts: (a) all of the accounts into which are deposited any Funds Pledged to Note Repayment; (b) the Note Reserve Fund; and (c) the 100% Tax Payment Fund, and of all other transactions relating to such funds and of all investments of moneys in such accounts and the interest and gain derived therefrom. (FORM OF NOTE) UNITED STATES OF AMERICA STATE OF MICHIGAN COUNTY OF OAKLAND Number $5,000 GENERAL OBLIGATION LIMITED TAX NOTE, SERIES 1979 KNOW ALL MEN BY THESE PRESENTS, that the County of Oakland, Michigan, hereby acknowledges itself indebted and for value received, promises to pay to the bearer hereof the sum of FIVE THOUSAND DOLLARS on the first day of .2 A.D. 19 , together with interest thereon from the date hereof until paid, at the rate of per centum ( %) per annum, payable on 1, 1979, and thereafter semi-annually on the first days of and in each year. Both principal and interest are payable in lawful money of the United States of America , upon presentation and surrender of this note and the coupons attached hereto as they severally mature. This note is one of a series of notes of like date and tenor, except as to maturity , numbered consecutively in the direct order of their maturities from 1 to , both inclusive, aggregating the principal sum of Dollars ($ ), issued under and pursuant to and in full conformity with the Constitution and Statutes of the State of Michigan and especially Act No. 206 of the Michigan Public Acts of 1893, as amended. The proceeds of this series of notes will be used to make payments to all taxing units in the County for the 1978 real property taxes returned to the County Treasurer as delinquent on March 1, 1979 and for the purpose of establishing a Note Reserve Fund, in an amount of $ For the payment of the principal and interest on these notes, the following amounts are hereby pledged: (1) all of the collections of the real property taxes due and payable to taxing units in Oakland County, including the County of Oakland, which were outstanding and uncollected on March 1, 1979, together with all interest thereon; (2) all (if the (")flecUon fees on such delinquent taxes, once the expenses of borrowing have been paid; and (3) any amounts which are received by the County from the taxing units within the County because of the uncollectability of such delinquent taxes. In the event the foregoing amounts are insufficient for any reason to meet the prompt payment of the principal and interest on these notes when due, the moneys in the Note Reserve Fund shall be used to make such payment. This note, in addition, is a general obligation of the County of Oakland, secured by its full faith and credit, which shall include the County's limited tax obligation, within applicable constitutional and statutory limits, and its general funds. The county budget provides that if the pledged delinquent taxes and any other pledged amounts are not collected in sufficient amounts to meet the payments of the principal and interest due on these notes, the County, before paying any other budgeted amounts, will promptly advance from its general funds sufficient money to pay principal and interest on these notes. The County does not, however, have the power to levy any tax for the payment of these notes in excess of its statutory limits. Notes of this series are not subject to redemption prior to maturity. It is hereby certified, recited and declared that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of the notes of this series, existed, have happened and have been performed in due time, form and manner as required by the Constitution and Statutes of the State of Michigan. IN WITNESS WHEREOF, the County of Oakland, Michigan, has caused this note to be signed in its name by its Treasurer and its corporate seal to be affixed hereto, and has caused the annexed interest coupons to be executed with the facsimile signature of its Treasurer, all as of the first day of April, 1979. COUNTY OF OAKLAND By 'Treasurer (SEAL) Number $5,000 (COUPON) On the first day of , A.D., 19 , The County of Oakland, Michigan, will pay to the bearer hereof the sum shown hereon in lawful money of the United States of America at the , same being the interest due on that day on its General Obligation Limited Tax Note, Series 1979, bearing the number shown hereon. The coupon is payable only from the following sources: certain delinquent real property taxes, the interest thereon, a part of the collection fees thereon, moneys on deposit in a certain Note Reserve Fund and other amounts all as described in the Note to which this coupon pertains. (Facsimile) Oakland County Treasurer OFFICIAL NOTICE OF SALE COUNTY OF OAKLAND STATE OF MICHIGAN GENERAL OBLIGATION LIMITED TAX NOTES, SERIES 1979 SEALED BIDS for the purchase of General Obligation Limited Tax Notes, Series 1979, of the County of Oakland, Michigan, of the par value of $ will be received by the undersigned at the office of the County Treasurer, Oakland County Building, Pontiac, Michigan 48053, until Michigan Time, on , 1979, at which time they will be publicly opened and read. Sealed bids will also be received, in the alternative, on the same date and until the same time, by an agent of the undersigned at the office of the Municipal Advisory Council of Michigan, 2135 First National Building, Detroit, Michigan 48226, where they will simultaneously be publicly opened. Bids opened at Detroit, Michigan, will be read first, followed by the alternate location. Bidders may choose either location to present bids and good faith checks, but not at both locations. The notes will be awarded to the successful bidder at a proceeding conducted by the County Treasurer approximately thirty minutes after all bids have been opened on that date. NOTE DETAILS: The notes will be coupon notes of the denomination of $5,000 each, will bear interest from their date payable on November 1, 1979, and semi-annually thereafter, will be dated April 1, 1979, will be numbered in direct order of maturity from 1 to , inclusive, and will mature serially on May 1 in years and amounts as follows: Year Amount 1980 1981 1982 PRIOR REDEMPTION: The notes shall not be subject to redemption prior to maturity. INTEREST RATE AND BIDDING DETAILS: The notes will bear interest from their date at a rate or rates specified by the successful bidder, not exceeding eight and three- quarters percent (8 3/4%) per annum, expressed in multiples of 1/8 or 1/20 of 1%, or any combination thereof. Interest on the notes of any maturity shall be at one rate only, and the difference between the highest and lowest rate of interest bid shall not exceed one percent (1%). PAYING AGENT: Both principal and interest will be payable at a bank or trust company located in the State of Michigan, qualified to act as paying agent under the statutes of the State of Michigan or of the United States of America, to be designated by the original purchaser of the notes, who may also designate a co-paying agent or agents, which may be either a bank located in the State of Michigan or a bank located outside of Michigan, or both, qualified to act as a paying agent under the law of the State in which located or of the United States of America, all of which shall be subject to the approval of the County Treasurer. Either the paying agent or a co-paying agent must be a Michigan bank located in a Federal Reserve City. The designation of paying agent or paying agents shall be made by letter or telegram to the undersigned within 24 hours after the time of sale. In the event no paying agent is designated within the time herein provided, or in the event that the paying agent designated is not qualified under the statutes of this State or of the United States of America, or is not approved by the Treasurer, the Treasurer shall appoint the paying agent or paying agents after discussion with the original purchaser. PURPOSE: The notes are issued for the purpose of establishing the County's 100% Tax Payment Fund for the 1978 tax year and for the purpose of establishing a $ Note Reserve Fund. PRIMARY SECURITY: The notes are primarily secured by: (1) all of the collections of the real property taxes due and payable to taxing units in Oakland County, including the County of Oakland, which were outstanding and uncollected on March 1, 1979, together with all interest thereon; (2) all of the collection fees on such delinquent taxes, once the expenses of borrowing have been paid; and (3) any amounts which are received by the County from the taxing units within the County because of the uncollectability of such delinquent taxes. NOTE RESERVE FUND: In the event the foregoing amounts are insufficient, for any reason, to meet the prompt payment of the principal and interest on these notes when due, the moneys in the Note Reserve Fund shall be used to make such payment. All moneys in the Note Reserve Fund shall be used solely for payment of principal and interest on the notes or for the purchase of notes for which the fund was established. Moneys in the Note Reserve Fund shall first be withdrawn for payment of principal and interest on notes before other county general funds are used to make the payments. When the Note Reserve Fund is sufficient to retire the notes and accrued interest thereon, it may be used for purchase of such notes on the market or, if notes are not available, to retire notes when due. LIMITED GENERAL OBLIGATION: This note issue, in addition, is a general obligation of the County of Oakland, secured by its full faith and credit, which shall include the County's limited tax obligation, within applicable constitutional and statutory limits and its general funds. The county budget provides that if the pledged delinquent taxes and any other pledged amounts are not collected in sufficient amounts to meet the payments of the principal and interest due on these notes, the County, before paying any other budgeted amounts, will promptly advance from its general funds sufficient moneys to pay that principal and interest. The County of Oakland does not have the power to levy any additional taxes for the payment of the notes in excess of its constitutional and statutory limits. AWARD OF THE NOTES: For the purpose of awarding the notes, the interest cost of each bid will be computed by determining, at the rate or rates specified therein, the total dollar amount of all interest on the notes from , 1979 to their maturity and deducting therefrom any premium. The notes will be awarded to the bidder whose bid on the above computation produces the lowest interest to the County. No proposal for less than par, nor less than all the notes, will be considered. Each bidder, for the convenience of the County, shall state in his bid the net interest cost to the County, computed in the manner above specified. GOOD FAITH: A certified check, cashier's check or bank money order in the amount of $ , drawn upon an incorporated bank or trust company and payable to the order of the County Treasurer must accompany each bid as a guarantee of good faith on the part of the bidder, to be forfeited as liquidated damages if such bid is accepted and the bidder fails to take up and pay for the notes. No interest will be allowed on good faith deposits. The good faith check of the winning bidder will be promptly cashed, and the amount received therefor will be credited against the purchase price as of the date of delivery. Checks of unsuccessful bidders will be promptly returned to each bidder's representative or by registered mail. In the event the notes cannot be issed or delivered for any reason, the County will pay back to the successful bidder the principal amount of the good faith check without interest. LEGAL OPINION: Bids shall be conditioned upon the unqualified approving opinion of Dickinson, Wright, McKean, Cudlip & Moon, attorneys of Detroit, Michigan, approving the legality of the notes, copies of which will be printed on the reverse side of each note, and the original of the opinion will be delivered without expense to the purchaser of the notes at the delivery thereof. DELIVERY OF NOTES: The County will furnish notes ready for execution at its expense at Detroit, Michigan . The usual documents, including a certificate that no litigation is pending affecting the issuance of the notes, will be delivered at the time of delivery of the notes. If the notes are not tendered for delivery by twelve o'clock noon, Michigan Time, on the 45th day following the date of sale, or the first business day thereafter if said 45th day is not a business day, the successful bidder may on that day, or any time thereafter until delivery of the notes, withdraw his proposal by serving notice of cancellation on the undersigned, in writing, in which event the County shall promptly return the good faith deposit. Payment for the notes shall be made in Federal Reserve Funds. Accrued interest to the date of delivery of the notes shall be paid by the purchaser at the time of delivery. CUSIP NUMBERS: Cusip numbers have been applied for and will be printed on the notes at the County's expense. The printing of incorrect Cusip numbers or the failure to print the Cusip numbers on the notes shall not constitute cause for the purchaser to refuse delivery of the notes. ADDITIONAL INFORMATION: Further information may be obtained from the Oakland County Treasurer at the address specified above. THE RIGHT IS RESERVED TO REJECT ANY OR ALL BIDS. ENVELOPES: Envelopes containing the bids should be plainly marked "Proposal for General Obligation Limited Tax Notes." Oakland County Treasurer APPROVED: STATE OF MICHIGAN MUNICIPAL FINANCE COMMISSION • • • AYES: NAYS: ABSENT: A sufficient majority having voted therefor, the resolution was adopted. The Finance Committee, by Mr. Dennis Murphy, Chairman, moves the adoption of the foregoing resolution. FINANCE COMMITTEE /(3) Dennis Murp y, rman #8774 February 1, 1979 Moved by Murphy supported by Dunaskiss the resolution be adopted. AYES: DiGiovanni, Doyon, Dunaskiss, Fortino, Ibbler, Gorsline, Hobart, Hoot, Kasper, Kelly, Lewand, McConnell, McDonald, Montante, Moore, Moxley, Murphy, Page, Patterson, Perinoff, Pernick, Peterson, Price, Roth, Wilcox, Aaron. (26) NAYS: None. (0) A sufficient majority having voted therefor, the resolution was adopted. STATE OF MICHIGAN) ) COUNTY OF OAKLAND) I, Lynn D. Allen, Clerk of the County of Oakland and having a seal, do hereby certify that 1 have compared the annexed copy of Miscellaneous Resolution #8774 adopted by the Oakland County Board of Commissioners at their meeting held on February 1, 1979 with the original record thereof now remaining in my office, and that it is a true and correct transcript therefrom, and of the whole thereof. In Testimony Whereof, I have hereunto set my hand and affixed the seal of said County at Pontiac, Michigan this 1st day of February 19.79 . Lynn D. Allen Clerk By Deputy Clerk