Salinas Municipal Code § 10-83 Bonds not debt of city

The city may, from time to time, upon resolution of the city council approved following a public hearing held in conformity with Section 103(k) of the Internal Revenue Code of 1954, as amended, where applicable, issue bonds to provide funds for the financing of any project or to refund bonds of the city previously issued under the terms of this division or other power of the city.

(Ord. No. 1883 (NCS), § 1.)

Bonds hereby authorized to be issued shall be limited obligations of the city payable from all or any specified part of the revenues authorized in this division to be pledged or assigned to secure payment of bonds. Such revenues, moneys or assets shall be the sole source of repayment of such issue of bonds. Such bonds shall not be deemed to constitute a debt or liability of the city or a pledge of the faith and credit of the city. The issuance of bonds shall not directly, indirectly or contingently obligate the city to levy or pledge any form of taxation or to make any appropriation for their payment.

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 Salinas or the State of California is pledged to the payment of the principal of or premium, if any, or interest on this Bond.

(Ord. No. 1883 (NCS), § 1.)

Bonds may be issued as serial bonds, term bonds, installment bonds, passthrough certificates, or any combination thereof, 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, either coupon (to the extent permitted by law) or registered or both, carry such registration privileges, be payable at such place or places, be subject to such redemption terms and have such other terms and conditions as the city council may provide. Bonds shall be executed on behalf of the city by the mayor and the city clerk or a duly authorized deputy thereof and any coupons appertaining to such bonds shall be executed by the city clerk or a duly authorized deputy thereof. Any or all of such signatures may be by facsimile. Bonds may be sold at either a public or private sale and for such prices as the city shall determine. Pending preparation of definitive bonds, the city may issue temporary bonds, which shall be exchanged for such definitive bonds when prepared.

(Ord. No. 1883 (NCS), § 1.)

In the discretion of the city, any bonds issued under this division may be secured by a trust indenture between the city and a corporate trustee or trustees, which may be any trust company or bank having the powers of a trust company in the state or in another state. Such trust indenture or the resolution providing for the issuance of such bonds may pledge or assign the revenues to be received or the proceeds of any contract or contracts and may convey or mortgage the project or any portion thereof. Such trust indenture or resolution providing for the issuance of such bonds may contain such provisions for protecting and enforcing the rights and remedies of the bondholders as may be reasonable, proper and not in violation of law. Any such trust indenture may set forth the rights and remedies of the bondholders and of the trustee or trustees and may restrict the individual right of action by bondholders. In addition, any such trust indenture may contain such other provisions as the city may deem reasonable and proper for the security of the bondholders. All expenses incurred in carrying out such trust indenture may be treated as a part of the cost of the operation of a project.

(Ord. No. 1883 (NCS), § 1.)

Any resolution authorizing any bonds or any issue of bonds, or any trust indenture authorized by such resolution to be entered into by the city, may contain provisions respecting any of the following terms and conditions:

(a) The terms, conditions and form of such bonds and the interest and principal to be paid thereon;

(b) Limitations on the uses and purposes to which the proceeds of sale of such bonds may be applied, and the pledge or assignment of such proceeds to secure the payment of such bonds;

(c) Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured, and the refunding of outstanding bonds;

(d) The setting aside of reserves and sinking funds and the regulation and disposition thereof;

(e) The pledge or assignment of all or any part of the revenues and the use and disposition thereof, subject to such agreements with the holders of bonds as may then be outstanding;

(f) Limitation on the use of revenues for expenditures for operating, administration or other expenses of the city;

(g) Specification of the acts or omissions to act which shall constitute a default in the duties of the city to holders of such bonds, and providing the rights and remedies of such holders in the event of default, including any limitations on the right of action by individual bondholders;

(h) The procedure, if any, by which the terms may be amended or abrogated, the amount of such bonds the holders of which must consent thereto, and the manner in which such consent may be given; and

(i) Any other provisions which the city council may deem reasonable and proper for the purposes of this division and the security of the bondholders.

(Ord. No. 1883 (NCS), § 1.)

The principal of and interest on bonds may be secured by a pledge of, or security interest in, the revenues or from other moneys available therefor and not otherwise pledged or used as security and may be secured by a trust indenture.

(Ord. No. 1883 (NCS), § 1.)

The city may obtain, or aid in obtaining, from any department or agency of the United States or of the state or any private company or banking institution, any insurance, guarantee, letter of credit or contractual agreement as to, or of or for the payment or repayment of, interest or principal, or both, or any part thereof, on any bond issued under the terms of this division or on any loan, lease or sale obligation or any instrument evidencing or securing the same, made or entered into pursuant to the provisions of this division, and may accept payment in such manner and form as provided therein, and may assign any such insurance or guarantee as security for bonds.

(Ord. No. 1883 (NCS), § 1.)

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

(Ord. No. 1883 (NCS), § 1.)

The city may issue bonds for the purpose of refunding any bonds then outstanding, including the payment of any redemption premiums thereof and any interest accrued or to accrue to any date or dates of redemption, purchase or maturity of such bonds.

The proceeds of bonds issued for the purpose of refunding any outstanding bonds may, in the discretion of the city, be applied to the purchase or retirement at maturity or redemption of such outstanding bonds, either at their earliest or any subsequent redemption date or dates or upon the purchase or retirement at the maturity thereof and may, pending such application, be placed in escrow, to be applied together with the earnings thereon to such purchase or retirement at maturity or redemption on such date or dates as may be determined by the city.

(Ord. No. 1883 (NCS), § 1.)

Any pledge of revenues or other moneys or assets as authorized by this division shall be valid and binding from the time such pledge is made. Revenues, moneys and assets so pledged and thereafter received by the city shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of any such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract, or otherwise against the city, irrespective of whether such parties have notice thereof. Neither the resolution nor any indenture by which a pledge is created need be filed or recorded except in the records of the city.

(Ord. No. 1883 (NCS), § 1.)

The city shall have the power out of any funds available therefor to purchase bonds. The city may hold, pledge, cancel, or resell bonds, subject to and in accordance with agreements with the bondholders.

(Ord. No. 1883 (NCS), § 1.)

In anticipation of the sale of bonds, 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. Such notes shall be payable from revenues or other moneys or assets authorized by this division to be pledged to secure payment of bonds, and which are not otherwise pledged, or from the proceeds of sale of the particular bonds in anticipation of which they are issued. Such notes shall be issued in the same manner as bonds.

(Ord. No. 1883 (NCS), § 1.)