City of Industry Municipal Code Ch. 3.60 City of Industry Sales and Use Tax Financing Law

This chapter may be cited as the city of Industry sales and use tax financing law.

(Ord. 654 § 1, 2000)

The council finds and declares that it is necessary, essential, a public purpose and a municipal affair for the city to provide financing for municipal facilities serving residents and businesses of the city, and to provide financing for working capital purposes of the city, in the interests of the public health, safety and welfare.

(Ord. 654 § 1, 2000)

Unless the context otherwise requires, the following definitions shall govern the construction of this chapter:

"Acquisition and construction"

means, with respect to any public capital improvement, the acquisition, construction, improvement, furnishing, equipping, remodeling, repair, reconstruction or rehabilitation there-of.

"Bonds"

mean any bonds, notes, installment sale agreements, leases or other obligations issued or entered into by the city pursuant to this chapter for the purpose of financing the costs of a public capital improvement, which are payable in whole or in part from sales and use taxes.

"Bradley-Burns Uniform Local Sales and Use Tax Law"

means the provisions of Part 1.5 of Division 2 of the Revenue and Taxation Code of the state, commencing with Section 7200 of such code.

"Chapter"

means this Chapter 3.60 of Title 3 of the Industry Municipal Code, as amended from time to time, in accordance herewith.

"Charter"

means the charter of the city, as amended from time to time.

"City"

means the City of Industry, California, a Charter city in the state existing under and exercising powers pursuant to the charter and the Constitution of the state.

"City council"

means the city council of the city.

"Costs"

means, with reference to a public capital improvement, any or all of the following costs incurred for the acquisition and construction thereof:

Obligations of the city incurred for labor and materials in connection with the acquisition and construction of the public capital improvement;

The cost of acquisition and construction of any property, whether real or personal and improved or unimproved, including franchise rights and other intangible property, and any interests therein, required- for the acquisition and construction of the public capital improvement;

The cost of demolishing, removing or relocating any building or structure, and the cost of making relocation assistance payments required by law;

The cost of contract bonds and of insurance of all kinds that may be required or necessary during the course of the acquisition and construction of the public capital improvement;

All costs of engineering, legal and consultant services, including the costs of the city for surveys, estimates, plans and specifications and preliminary investigation therefor, and for supervising construction, as well as for the performance of all other duties required by or consequent upon the proper acquisition and construction of the public capital improvement;

All costs incurred in connection with proceedings by the city necessary to comply with the California Environmental Quality Act of 1970, as amended;

All amounts required to fund any reserve funds for bonds and any interest on bonds becoming due and payable during a period not exceeding the period of acquisition and construction of the public capital improvement, and for twelve months thereafter;

All costs of issuing the bonds;

All costs which the city shall be required to pay, under the terms of any contract or contracts, for the acquisition and construction of the public capital improvement;

The refinancing of any existing indebtedness relating to the public capital improvement; and

Any sums required to reimburse the city for advances made for any of the above items, or for any other costs incurred and for work done which are properly chargeable to the public capital improvement.

"Public capital improvement"

any land, improvements, facilities, equipment and other property of any nature whatsoever, which constitutes property for which the city is authorized to expend sales and use taxes. The precise description of any public capital improvement for which financing is provided under this chapter shall be set forth in the proceedings of the city council authorizing such financing.

"Sales and use tax ordinance"

means the ordinance adopted by the city council of the city authorizing the levy of sales and use taxes by the city pursuant to the Bradley-Burns Uniform Local Sales and Use Tax Law.

"Sales and use taxes"

means all of the sales and use taxes levied by the city on taxable sales transactions within the city under and pursuant to the sales and use tax ordinance, which are collected by the State Board of Equalization and transmitted to the city periodically pursuant to Section 7204 of the Bradley-Burns Uniform Local Sales and Use Tax Law.

"State"

means the state of California.

"Working capital expenditures"

means any expenditures made by the city to pay current expenses of the city, to establish reserves, to make payments in respect of insurance or to establish insurance reserves, to make investments, and to discharge of any obligation or indebtedness of the city, including expenditures for any purpose for which the city may borrow money pursuant to Section 53852 of the Government Code of the state; provided that such expenditures would otherwise be authorized to be paid from sales and use taxes.

(Ord. 654 §1, 2000)

In connection with the acquisition and construction of a public capital improvement by the city, or in connection with the payment of working capital expenditures, the city is authorized and empowered:

A. To issue bonds for the purpose of financing or otherwise assisting the payment of the costs of the public capital improvement, for the purpose of paying any working capital expenditures, and for the purpose of funding or refunding any issue of bonds;

B. To establish the terms and conditions for the financing of the public capital improvement or working capital expenditure pursuant to this chapter;

C. To employ or contract for such legal, consultant, underwriting, economic feasibility, or other services in connection with the financing of the public capital improvement or working capital expenditure, or to contract for bond insurance or other forms of collateral security, as may be necessary in the judgment of the city council for the successful financing of the public capital improvement or working capital expenditure and the issuance and sale of bonds therefor;

D. In addition to all other powers specifically granted in this chapter, to do all things necessary or convenient to carry out the purposes of this chapter.

(Ord. 654 § 1, 2000)

The city may issue its bonds for the purpose of financing or otherwise assisting the acquisition and construction of all or any portion of a public capital improvement, or for the purpose of financing any working capital expenditures, as authorized by this chapter. Every issue of bonds shall be a limited obligation of the city, payable solely from the sales and use taxes which are pledged therefor. Bonds may be issued by the city only following approval thereof by two-thirds of the voters of the city at an election duly called and conducted in accordance with the provisions of this chapter.

(Ord. 654 § 1, 2000)

The city council may submit to the qualified electors in the city a proposition to authorize the issuance of any bonds pursuant to this chapter. The proposition authorizing the issuance of bonds under this chapter shall become effective if approved by at least two-thirds of the qualified electors voting on the proposition. Any such election shall be conducted as set forth in this chapter.

(Ord. 654 § 1, 2000)

By resolution adopted by majority of the members of the city council, the city council shall submit any proposition authorizing the issuance of bonds under this chapter to the qualified electors of the city in the next general election or in a special election to be held, notwithstanding any other requirement contained in the California Elections Code, including any requirement that elections be held on specified dates. Such election shall be held not less than sixty days, but not more than one hundred eighty days, following, the adoption of such resolution. If the election is to be held less than ninety days following the adoption of such resolution and the election official is other than the city clerk, the concurrence of the election official conducting the election shall be required. In the resolution providing for the election, the city council shall designate a person to be the election official who may be the city clerk.

Except as otherwise provided in this chapter, the provisions of law regulating elections of the city, insofar as they may be applicable, shall govern all elections conducted pursuant to this code. There shall be prepared and included in the ballot material provided to each voter an impartial analysis, and arguments and rebuttals, if any.

(Ord. 654 § 1, 2000)

At the option of the city council, ballots for any election authorized by this chapter may be distributed to qualified electors by mail with return postage prepaid or by personal service by the election official. The election official may provide a certificate of the proper mailing or delivery of ballots, which certificate shall constitute conclusive proof of mailing or delivery in the absence of fraud. The voted ballots shall be returned to the election officer conducting the election not later than the time specified in the resolution calling the election.

If the election is to be conducted by mail or hand delivered ballot, the election official conducting the election shall provide ballots and election materials together with all supplies and instructions necessary for the use and return of the ballot.

(Ord. 654 § 1, 2000)

The purpose for which an election shall be held pursuant to this chapter shall be to comply with the requirements of Article XVI, Section 18 of the Constitution of the state, which states in pertinent part that "No county, city, town, township, board of education, or school district, shall incur any indebtedness or liability in any manner or for any purpose exceeding in any year the income and revenue provided for such year, without the assent of two-thirds of the qualified electors thereof, voting at an election to be held for that purpose." It shall not be necessary for the ballot proposition to authorize a specific principal amount of bonds to be issued, so long as the ballot proposition shall authorize the incurrence of debt by the city which is payable from all or any portion of the sales and use taxes. The ballot proposition shall contain a general description of the purposes for which the bonds are to be issued under this chapter.

(Ord. 654 § 1, 2000)

Bonds may be issued as serial bonds or as term bonds, as current interest bonds or capital appreciation bonds, or in such other or additional forms as the city council may deem advisable. The bonds shall be authorized by resolution of the city council and shall bear such date or dates, mature at such time or times, bear interest at such fixed or variable rate or rates, be payable at such time or times, be in such denominations, be in such form, carry such registration privileges, be executed in such manner, be payable in lawful money of the United States of America at such place or places, and be subject to such terms of redemption as the city council may provide. The bonds may be sold at either a public or private sale and for such prices as the city council shall determine.

(Ord. 654 § 1, 2000)

Any proceedings of the city authorizing bonds may contain provisions respecting any of the following terms and conditions, which shall be a part of the contract with the owners of the bonds:

A. The pledge of all or any part of the sales and use taxes, including provisions by which the city assigns the sales and uses taxes to a trustee or fiscal agent for the bonds;

B. The interest and principal to be received and other charges to be charged and the amounts to be raised each year thereby, and the procedures to be followed in the collection and application of sales and use taxes;

C. The setting aside of reserves or sinking funds and the regulation and disposition thereof;

D. Limitations on the purposes to which the proceeds of a sale of any issue of bonds, then or thereafter issued, may be applied, and pledging such proceeds to secure the payment of the bonds or any issue of bonds;

E. Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured, and the refunding of outstanding bonds;

F. The procedures, if any, by which the terms of any contract with bond owners may be amended or abrogated, the amount of bonds the owners of which must consent thereto, and the manner in which such consent may be given;

G. Specification of the acts or omissions to act which shall constitute a default in the duties of the city to the owners of the bonds, and providing the rights and remedies of such owners in the event of default;

H. Covenants for the protection of the security of the bonds and the owners of the bonds, including covenants restricting the authority of the city to issue additional obligations on a parity with the bonds;

I. Such other terms and conditions pertaining to the issuance of the bonds as are deemed advisable by the city council.

(Ord. 654 § 1, 2000)

Neither the members of the city council nor any person executing the bonds shall be liable personally on the bonds or be subject to any personal liability or accountability by reason of the issuance thereof.

(Ord. 654 § 1, 2000)

The city council may provide for the issuance of bonds any portion of which is to be used for the purpose of refunding outstanding bonds, including the payment of the principal thereof and interest and redemption premiums, if any, thereon. The proceeds of bonds issued to refund any outstanding bonds may, in the discretion of the city council, be applied to-the retirement of such outstanding bonds at maturity, or the redemption (on any redemption date) or purchase of such outstanding bonds prior to maturity, upon such terms and subject to such conditions as the city council shall deem advisable.

(Ord. 654 § 1, 2000)

Sales and use taxes, or any portion thereof, as designated in the resolution, trust agreement or indenture authorizing the issuance of the bonds, shall be the sole source of funds pledged by the city for repayment of bonds issued hereunder. Bonds issued hereunder shall not be deemed to constitute a pledge of the faith and credit of the city but shall be limited obligations of the city payable solely from sales and use taxes. All bonds shall contain on the face thereof a statement to the following effect:

Neither the faith and credit nor the taxing power of the City of industry is pledged to the payment of the principal of or interest on this Bond.

The issuance of bonds shall not directly, indirectly or contingently obligate the city council to levy or pledge any form of taxation, other than the sales and use taxes which are specifically pledged therefor, or to make any appropriation for their payment.

(Ord. 654 § 1, 2000)

All moneys received pursuant to the provisions of this chapter, whether proceeds from the sale of bonds or sales and use taxes or other moneys or assets authorized by this chapter to be pledged to secure payment of bonds, shall, to the extent set forth in the resolution or trust agreement authorizing the issuance of the bonds, be deemed to be trust funds to be held and applied solely for the purposes of this chapter. Any bank or trust company in which such moneys are deposited shall act as trustee of such moneys and shall hold and apply the same for the purposes specified in this chapter, subject to the terms of the resolution, agreement or indenture authorizing the bonds.

(Ord. 654 § 1, 2000)

In anticipation of the sale of bonds authorized by this chapter, the city is authorized to issue bond anticipation notes, and to renew the same from time to time, in such series and amounts as are determined by the city council to be necessary or appropriate for the costs of a public capital improvement or for the payment of working capital expenditures, as approved by the city council. Such notes shall be payable from sales and use taxes or other moneys or assets authorized by this chapter to be pledged to secure payment of bonds, and which are not otherwise pledged, or from the proceeds or sale of the particular bonds in anticipation of which they are issued. Such notes shall be issued in the same manner as other bonds which are authorized to be issued hereunder.

(Ord. 654 § 1, 2000)

This chapter, being necessary for the health, welfare and safety of the city, its residents and businesses, shall be liberally construed to effect its purposes. Furthermore, the city council declares that this chapter is an exercise of the power granted to the city by the city charter and the Constitution of the state and is an exercise by the city of its powers as to municipal affairs and its police powers, and this chapter shall be liberally construed to uphold its validity under the laws of the state.

(Ord. 654 § 1, 2000)

This chapter shall be deemed to provide a complete, additional and alternative method for doing the things authorized, and shall be regarded as supplemental and additional to the powers conferred by other laws. The issuance of bonds under the provisions of this chapter need not comply with the requirements of any other law applicable to the issuance of bonds for a public capital improvement or a working capital expenditure. The purposes authorized may be effectuated and bonds are authorized to be issued for any such purposes under this chapter notwithstanding that any other law may provide for such purposes or for the issuance of bonds for like purposes and without regard to the requirements, restrictions, limitations or other provisions contained in any other law.

(Ord. 654 § 1, 2000)

An action may be brought pursuant to Chapter 9 (commencing with Section 860 of Title 10 of Part 2) of the Code of Civil Procedure, to determine the validity of bonds and the legality and validity of all proceedings previously taken and proposed to be taken for the authorization, issuance, sale, and delivery of the bonds and for the payment of the principal thereof and interest thereon.

(Ord. 654 § 1, 2000)

This chapter shall not be amended so as to have a material, adverse effect upon the rights of the owners of any outstanding bonds theretofore issued hereunder, without the written consent of such bond owners; provided, however, that this chapter may be amended at any time (A) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision herein contained, as the city may deem necessary or desirable; or (B) if such amendment does not materially impair or adversely affect the interests of any such bond owner in the opinion of the city council; or (C) if such amendments apply solely to bonds not theretofore issued.

(Ord. 654 § 1, 2000)

To the extent that the provisions of this chapter are inconsistent with the provisions of any general statute or special act or parts thereof, the provisions of this chapter shall be deemed controlling to the full extent to which the city is competent to make such provisions by virtue of its municipal affairs powers as a Charter city of the state.

(Ord. 654 § 1, 2000)