HomeMy WebLinkAboutResolutions - 2014.04.30 - 21305Miscellaneous Resolution #14093 April 30, 2014
BY: FINANCE COMMITTEE, THOMAS MIDDLETON, CHAIRPERSON
IN RE: TREASURER'S OFFICE - RESOLUTION TO BORROW AGAINST
DELINQUENT 2013 REAL PROPERTY TAXES
TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS
Mr. Chairperson, Ladies and Gentlemen:
WHEREAS, the Board of Commissioners of the County of Oakland (the "County") has
heretofore adopted a resolution establishing the Oakland County Delinquent Tax Revolving Fund (the
"Fund") pursuant to Section 87b of Act No. 206, Public Acts of Michigan, 1893, as amended ("Act
206"); and
WHEREAS, the purpose of the Fund is to allow the Oakland County Treasurer (the "County
Treasurer") to pay from the Fund any or all delinquent real property taxes that are due and payable to the
County, the State of Michigan and any school district, intermediate school district, community college
district, city, township, special assessment district or other political unit for which delinquent tax
payments are due; and
WHEREAS, it is hereby determined to be necessary for the County to borrow money and issue
its notes for the purposes authorized by Act 206, particularly Sections 87c, 87d and 87g thereof; and
"WHEREAS, the County has agreed in a Continuing Covenant Agreement dated as of
September 27, 2013, between the County and Bank of America, N.A. to provide to Bank of America,
NA. certain information pursuant to Article VI, Section 6.05 (f) of the Continuing Covenant Agreement
which relates to a final official statement or other offering or disclosure document prepared in
connection with an offering of securities by the County; and
FINANCE COMMITTEE VOTE:
Motion carried unanimously on a roll call vote with Taub and Crawford absent.
WHEREAS, it is estimated that the total amount of unpaid 2013 delinquent real property taxes
(the "delinquent taxes") outstanding on March 1, 2014, will be approximately $78,500,000, exclusive of
interest, fees and penalties.
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the County of
Oakland, State of Michigan, as follows:
Authorization of Borrowing
1. Pursuant to and in accordance with the provisions of Act 206, Public Acts of
Michigan, 1893, as amended, and especially Sections 87c, 87d and 87g thereof, the County shall borrow
the sum of not to exceed Twenty Five Million Dollars ($25,000,000) and issue its notes (the "notes")
therefor for the purpose of continuing the Fund for the 2013 tax year. The exact amount to be borrowed
shall not exceed the amount of delinquent taxes outstanding on March 1, 2014, exclusive of interest, fees
and penalties. The County Treasurer shall designate the exact amount to be borrowed after the amount
of the 2013 delinquent taxes outstanding on March 1, 2014, or the portion of the 2013 delinquent taxes
against which the County shall borrow, has been determined.
Note Details
2. Pursuant to provisions of applicable law and an order of the County Treasurer,
which order is hereby authorized, the notes may be issued in one or more series; shall be known as
"General Obligation Limited Tax Notes, Series 2014" with a letter designation added thereto if the notes
are issued in more than one series; shall be in fully registered form in denominations not exceeding the
aggregate principal amounts for each maturity of the notes; shall be sold for not less than 98% of the
face amount of the notes; shall bear interest at fixed or variable rates not to exceed the maximum interest
rate permitted by applicable law; shall be dated, payable as to interest and in principal amounts, be
subject to redemption in whole or in part prior to maturity, including any redemption premiums, and be
subject to renewal, at such times and in such amounts, all as shall be designated in the order of the
County Treasurer. Notes or portions of notes called for redemption shall not bear interest after the
redemption date, provided funds are on hand with the note registrar and paying agent to redeem the
same. Notice of redemption shall be given in the manner prescribed by the County Treasurer, including
the number of days' notice of redemption and whether such notice shall be written or published, or both.
If any notes of any series are to bear interest at a variable rate or rates, the County Treasurer is hereby
- further authorized to establish by order, and in accordance with law, a means by which interest on such
notes may be set, reset or calculated prior to maturity, provided that such rate or rates shall at no time be
in excess of the maximum interest rate permitted by applicable law. Such rates may be established by
reference to the minimum rate that would be necessary to sell the notes at par; by a formula that is
determined with respect to an index or indices of municipal obligations, reported prices or yields on
obligations of the United States or the prime rate or rates of a bank or banks selected by the County
Treasurer; or by any other method selected by the County Treasurer.
Payment of Principal and Interest
3. The principal of and interest on the notes shall be payable in lawful money of the
United States from such funds and accounts as provided herein. Principal shall be payable upon
presentation and surrender of the notes to the note registrar and paying agent when and as the same shall
become due, whether at maturity or earlier redemption. Interest shall be paid to the owner shown as the
registered owner on the registration books at the close of business on such date prior to the date such
interest payment is due, as is provided in the order of the County Treasurer. Interest on the notes shall
be paid when due by check or draft drawn upon and mailed by the note registrar and paying agent to the
registered owner at the registered address, or by such other method as determined by the County
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Treasurer.
Note Registrar and Paying Agent
4. The County Treasurer shall designate, and may enter into an agreement with, a
note registrar and paying agent for each series of notes that shall be the County Treasurer or a bank or
trust company that is qualified to act in such capacity under the laws of the United States of America or
the State of Michigan. The County Treasurer may from time to time designate a similarly qualified
successor note registrar and paying agent. Alternatively, the County Treasurer may serve as note
registrar and paying agent if so designated by written order of the County Treasurer.
Disposition of Note Proceeds
5. The proceeds of the sale of the notes shall be deposited into a separate account in
the Fund and shall be used to continue the Fund. The County Treasurer shall pay therefrom and from
unpledged funds in the Fund, uncommitted funds in the County General Fund and/or any other legally
available funds, the full amount of the delinquent tax roll against which the County has borrowed,
delivered as uncollected by any tax collector in the County and that is outstanding and unpaid on or after
March 1, 2014, in accordance with the provisions of Act 206. If the notes are sold at a premium, the
County Treasurer shall determine what portion of the premium, if any, shall be deposited in the 2014
Collection Account established in Section 6 hereof.
2014 Collection Account
6. There is hereby established as part of the Fund an account (hereby designated the
"2014 Collection Account") into which account the County Treasurer shall place delinquent taxes
against which the County has borrowed, and interest thereon, collected on and after March 1, 2014, or
such later date as determined by the County Treasurer, all County property tax administration fees on
such delinquent taxes, after expenses of issuance of the notes have been paid, any premium as
determined pursuant to Section 5 hereof, and any amounts received by the County Treasurer from the
County, the State of Michigan and any taxing unit within the County, because of the uncollectibility of
such delinquent taxes. The foregoing are hereby established as funds pledged to note repayment. The
County Treasurer shall designate the delinquent taxes against which the County shall borrow for each
series of notes.
Note Reserve Fund
7. There is hereby authorized to be established by the County Treasurer a note
reserve fund for the notes (the "2014 Note Reserve Fund") if the County Treasurer deems it to be
reasonably required as a reserve and advisable in selling the notes at public or private sale, The County
Treasurer is authorized to deposit in the 2014 Note Reserve Fund from proceeds of the sale of the notes,
unpledged moneys in the Fund, uncommitted funds in the County General Fund and/or any other legally
available funds, an amount not exceeding ten percent (1.0%) of the face amount of the notes.
Security for Payment of Notes
8. All of the moneys in the 2014 Collection Account and the 2014 Note Reserve
Fund, if established, and all interest earned thereon, relating to a series of notes are hereby pledged
equally and ratably as to such series to the payment of the principal of and interest on the notes and shall
be used solely for that purpose until such principal and interest have been paid in full. When moneys in
the 2014 Note Reserve Fund, if established, are sufficient to pay the outstanding principal of the notes
and the interest accrued thereon such moneys may be used to retire the notes. If more than one series of
notes is issued, the County Treasurer by order shall establish the priority of the funds pledged for
payment of each such series. in such case the County Treasurer may establish sub-accounts in the
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various funds and accounts established pursuant to the terms of this resolution as may be necessary or
appropriate.
Additional Security
9. Each series of notes, in addition, shall be a general obligation of the County,
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 shall provide
that if the pledged delinquent taxes and any other pledged amounts are not collected in sufficient
amounts to meet the payments of principal and interest due on each series of 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 shall not have the power to impose taxes for payment of the
notes in excess of constitutional or statutory limitations, if moneys in the 2014 Collection Account and
the 2014 Note Reserve Fund, if established, are not sufficient to pay the principal of and interest on the
notes, when due, the County shall pay the same in accordance with this Section, and may thereafter
reimburse itself from the delinquent taxes collected.
Release of Pledge of 2014 Collection Account
10. Upon the investment of moneys in the 2014 Collection Account in direct non-
callable obligations of the United States of America in amounts and with maturities that are sufficient to
pay in full the principal of and interest on the notes when due, any moneys in the 2014 Collection
Account thereafter remaining may be released from such pledge created pursuant to Section 8 hereof
and may be used to pay any or all delinquent real property taxes that are due the County, the State of
Michigan and any school district, intermediate school district, community college district, city,
township, special assessment district or other political unit to which delinquent tax payments are due for
any year or for any other purpose permitted by law.
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Sale of Notes
11. The County Treasurer is hereby authorized to offer the notes at public or private
sale as determined by order of the County Treasurer and to do all things necessary to effectuate the sale,
delivery, transfer and exchange of the notes in accordance with the provisions of this resolution. Notes
of one series may be offered for sale and sold separately from notes of another series. If the notes are to
be sold publicly, sealed proposals for the purchase of the notes shall be received by the County
Treasurer for such public sale to be held at such time as shall be determined by the County Treasurer
and notice thereof shall be published in accordance with law, once in The Bond Buyer or the Detroit
Legal News, both of which are hereby designated as being a publication printed in the English language
and circulated in this State that carries as a part of its regular service, notices of sale of municipal bonds.
Such notice shall be in the form prescribed by the County Treasurer.
The County Treasurer is hereby authorized to cause the preparation of an official statement for
the notes for the purpose of enabling compliance with SEC Rule 15c2-12 (the "Rule") and to do all other
things necessary to enable compliance with the Rule. After the award of the notes, the County will
provide copies of a final official statement (as defined in paragraph (e)(3) of the Rule) on a timely basis
and in reasonable quantity as requested by the successful bidder or bidders to enable such successful
bidder or bidders to comply with paragraphs (b)(3) and (b)(4) of the Rule and the rules of the Municipal
Securities Rulemaking Board. The County Treasurer is authorized to enter into such agreements as may
be required to enable the successful bidder or bidders to comply with the Rule.
Continuing Disclosure
12. The County Treasurer is hereby authorized to execute and deliver in the name and
on behalf of the County (i) a certificate of the County to comply with the requirements for a continuing
disclosure undertaking of the County pursuant to paragraph (b)(5) or (d)(2) of the Rule, as applicable,
and (ii) amendments to such certificate from time to time in accordance with the terms of such
certificate (the certificate and any amendments thereto are collectively referred to herein as the
"Continuing Disclosure Certificate"). The County hereby covenants and agrees that it will comply with
and carry out all of the provisions of the Continuing Disclosure Certificate.
Execution and Delivery of Notes
13. The County Treasurer is hereby authorized and directed to execute the notes for
the County by manual or facsimile signature and the County Treasurer shall cause the County seal or a
facsimile thereof to be impressed or imprinted on the notes. Unless the County Treasurer shall specify
otherwise in writing, fully registered notes shall be authenticated by the manual signature of the note
registrar and paying agent. After the notes have been executed and authenticated, if applicable, for
delivery to the original purchaser thereof, the County Treasurer shall deliver the notes to the purchaser
or purchasers thereof upon receipt of the purchase price. Additional notes bearing the manual or
facsimile signature of the County Treasurer and upon which the seal of the County or a facsimile thereof
is impressed or imprinted may be delivered to the note registrar and paying agent for authentication, if
applicable, and delivery in connection with the exchange or transfer of fully registered notes. The note
registrar and paying agent shall indicate on each note that it authenticates the date of its authentication.
The notes shall be delivered with the approving legal opinion of Dickinson Wright PLLC. Municipal
Financial Consultants Incorporated, Grosse Pointe Farms, Michigan, is hereby retained to act as
financial consultant and advisor to the County in connection with the sale and delivery of the Notes.
Exchange and Transfer of Fully Registered Notes
14. Any fully registered note, upon surrender thereof to the note registrar and paying
agent with a written instrument of transfer satisfactory to the note registrar and paying agent duly
executed by the registered owner or his or her duly authorized attorney, at the option of the registered
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owner thereof, may be exchanged for notes of any other authorized denominations of the same aggregate
principal amount and maturity date and bearing the same rate of interest as the surrendered note.
Each note shall be transferable only upon the books of the County, which shall be kept
for that purpose by the note registrar and paying agent, upon surrender of such note together with a
written instrument of transfer satisfactory to the note registrar and paying agent duly executed by the
registered owner or his or her duly authorized attorney.
Upon the exchange or transfer of any note, the note registrar and paying agent on behalf
of the County shall cancel the surrendered note and shall authenticate, if applicable, and deliver to the
transferee a new note or notes of any authorized denomination of the same aggregate principal amount
and maturity date and bearing the same rate of interest as the surrendered note. If, at the time the note
registrar and paying agent authenticates, if applicable, and delivers a new note pursuant to this Section,
payment of interest on the notes is in default, the note registrar and paying agent shall endorse upon the
new note the following: "Payment of interest on this note is in default. The last date to which interest
has been paid is [place date]."
The County and the note registrar and paying agent may deem and treat the person in
whose name any note shall be registered upon the books of the County as the absolute owner of such
note, whether such note shall be overdue or not, for the purpose of receiving payment of the principal of
and interest on such note and for all other purposes, and all payments made to any such registered
owner, or upon his or her order, in accordance with the provisions of Section 3 hereof shall be valid and
effectual to satisfy and discharge the liability upon such note to the extent of the sum or sums so paid,
and neither the County nor the note registrar and paying agent shall be affected by any notice to the
contrary. The County agrees to indemnify and save the note registrar and paying agent harmless from
and against any and all loss, cost, charge, expense, judgment or liability incurred by it, acting in good
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faith and without negligence hereunder, in so treating such registered owner.
For every exchange or transfer of notes, the County or the note registrar and paying agent
may make a charge sufficient to reimburse it for any tax„ fee or other governmental charge required to
be paid with respect to such exchange or transfer, which sum or sums shall be paid by the person
requesting such exchange or transfer as a condition precedent to the exercise of the privilege of making
such exchange or transfer.
The note registrar and paying agent shall not be required to transfer or exchange notes or
portions of notes that have been selected for redemption,
Book Entry System
15, At the option of the County Treasurer and notwithstanding any provisions of this
resolution to the contrary, the County Treasurer is hereby authorized to enter into an agreement with a
custodian or trustee for the purpose of establishing a "book entry" system for registration of notes to be
fully registered. Pursuant to the provisions of such agreement, the notes may be registered in the name
of the custodian or trustee for the benefit of other persons or entities, Such agreement shall provide for
the keeping of accurate records and prompt transfer of funds by the custodian or trustee on behalf of
such persons or entities. The agreement may provide for the issuance by the custodian or trustee of
certificates evidencing beneficial ownership of the notes by such persons or entities. For the purpose of
payment of the principal of and interest on the notes, the County may deem payment of such principal
and interest, whether overdue or not, to the custodian or trustee as payment to the absolute owner of
such note. Pursuant to provisions of such agreement, the book entry system for the notes may be used
for registration of all or a portion of the notes and such system may be discontinued at any time by the
County. The note registrar and paying agent for the notes may act as custodian or trustee for such
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purposes.
Issuance Expenses
16. Expenses incurred in connection with the issuance of the notes, including without
limitation any premiums for any insurance obtained for the notes, note rating agency fees, travel and
printing expenses, fees for agreements for lines of credit, letters of credit, commitments to purchase the
notes, remarketing agreements, reimbursement agreements, purchase or sales agreements or
commitments, or agreements to provide security to assure timely payment of the notes, fees for the
setting of interest rates on the notes and bond counsel, financial advisor, paying agent and registrar fees,
all of which are hereby authorized, shall be paid by the County Treasurer from County property tax
administration fees on the delinquent taxes, from any other moneys in the Fund not pledged to the
repayment of notes and general funds of the County that are hereby authorized to be expended for that
purpose.
Replacement of Notes
17. Upon receipt by the County Treasurer of satisfactory evidence that any
outstanding note has been mutilated, destroyed, lost or stolen, and of security or indemnity complying
with applicable law and satisfactory to the County Treasurer, the County Treasurer may execute or
authorize the imprinting of the County Treasurer's facsimile signature thereon and thereupon, and if
applicable, a note registrar or paying agent shall authenticate and the County shall deliver a new note of
like tenor as the note mutilated, destroyed, lost or stolen, Such new note shall be issued and delivered in
exchange and substitution for, and upon surrender and cancellation of, the mutilated note or in lieu of
and in substitution for the note so destroyed, lost or stolen in compliance with applicable law. For the
replacement of authenticated notes, the note registrar and paying agent shall, for each new note
authenticated and delivered as provided above, require the payment of expenses, including counsel fees,
which may be incurred by the note registrar and paying agent and the County in the premises. Any note
issued under the provisions of this Section in lieu of any note alleged to be destroyed, lost or stolen shall
be on an equal basis with the note in substitution for which such note was issued.
Chargebacks
18. For any principal payment date of the notes on or after January 1, 2017, the
delinquent taxes on property foreclosed and sold pursuant to the provisions of Act 206 and against
which the County has borrowed shall, if necessary to ensure full mid timely payment of principal of and
interest on the notes when due, be charged back to the taxing jtuisdictions in such manner as determined
by the County Treasurer. The proceeds of such ehargebacks shall be deposited in the 2014 Collection
Account as security for payment of the notes as described in Section 8 hereof The provisions of this
Section shall not limit the authority of the County Treasurer under the laws of the State of Michigan to
charge back delinquent taxes under other circumstances or at other times.
Purchase of Notes by County
19. All or any portion of the notes may be purchased or otherwise acquired by the
County if the County Treasurer by order deems such purchase or acquisition to be in the best interest of
the County. In such case, the County Treasurer is authorized to take such actions to effectuate the
purchase or acquisition, including without limitation entering into an agreement to purchase or
repurchase the notes. The purchase or other acquisition of notes by or on behalf of the County does not
cancel, extinguish or otherwise affect the notes and the notes shall be treated as outstanding notes for all
purposes of this resolution until paid in full.
Issuance of Refunding Notes
20. The County shall refund all or part of the notes authorized hereunder and/or notes
previously issued by the County to continue the Fund for prior tax years if and as authorized by order of
the County Treasurer through the issuance of refunding notes (the "Refunding Notes") in an amount to
be determined by order of the County Treasurer. Proceeds of the Refunding Notes may be used to
redeem such notes and to pay issuance expenses of the Refunding Notes as authorized and described in
Section 16 hereof. The County Treasurer shall have all the authority with respect to the Refunding
Notes as is granted to the County Treasurer with respect to the notes by the other Sections hereof,
including the authority to select a note registrar and paying agent, to apply to the Michigan Department
of Treasury for approval to issue the Refunding Notes, if necessary, to cause the preparation of an
official statement and to do all other things necessary to sell, execute and deliver the Refunding Notes.
The Refunding Notes shall contain the provisions, shall be payable as to principal and interest and shall
be secured as set forth herein and as further ordered by the County Treasurer. The Refunding Notes
may be sold as a separate issue or may be combined in a single issue with other obligations of the
County issued pursuant to the provisions of Act 206 as shall be determined by the County Treasurer.
The County Treasurer is authorized to prescribe the form of Refunding Note and the form of notice of
sale, if any, for the sale of Refunding Notes.
Notice of Issuance of Notes
21. Within thirty (30) days after the issuance of the notes, either (1) a copy of the
final official statement or other offering or disclosure document prepared by the County in connection
with the issuance of the notes or (2) notice that such information has been filed with the Electronic
Municipal Market Access system of the Municipal Securities Rulemaking Board and is publicly
available shall be furnished to Bank of America, N.A. at the following locations:
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Bank of America, N.A.
Mail Code: 1L4-13 5-07-28
135 South LaSalle Street
Chicago, IL 60603
Attention: Thomas R. Denes
Bank of America, N.A.
Public Sector Banking Group
Mail Code: M18-900-02-70
2600 W. Big Beaver Road
Troy, MI 48084
Attention: Susan Pendygraft,
Senior Credit Support Association
In accordance with the Continuing Covenant Agreement, the notices provided for above
shall be in writing and shall be transmitted by e-mail to the following addresses: ryan.denes@baml.com
and susan.pendygraft@baml.com .
Form of Notes
22. The notes shall be in the form approved by the County Treasurer, which approval
shall be evidenced by the County Treasurer's execution thereof.
Mr. Chairperson, on behalf of the Finance Committee, I move adoption of the foregoing
resolution.
Resolution #14093 April 30, 2014
Moved by Taub supported by Quarles the resolutions (with fiscal notes attached) on the Consent Agenda
be adopted (with accompanying reports being accepted).
AYES: Gershenson, Gosselin, Hatchett, Hoffman, Jackson, Long, Matis, McGillivray, Middleton,
Quarles, Runestad, Scott, Spisz, Taub, Weipert, Woodward, Zack, Bosnic, Dwyer. (19)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolutions (with fiscal notes attached) on the Consent
Agenda were adopted (with accompanying reports being accepted).
101406Yoomove THIS RESOLUTION
CHIEF DEPUTY COUNTY EXECUTIVE
ACTING PURSUANT TO MCL 45.559A (7)
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on April 30, 2014,
with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at
Pontiac, Michigan this 30111 day of April 2014.
"'5-te_ec 46,krbt,„,
Lisa Brown, Oakland County