Chapter 4.38

• 4.38.240 Construction.

AIRPORT REVENUE BOND LAW*

• 4.38.250 Costs.

Parts:

• 1 General Provisions

• 2 Definitions

• 3 Bond Issuance

• 4 Construction

Part 1

GENERAL PROVISIONS

Sections:

• 4.38.010 Title.

• 4.38.020 Purpose.

This chapter may be cited as the "City of San José Airport Revenue Bond Law." (Ord. 26340.)

The council hereby finds and declares that it is necessary, essential, a public purpose and a municipal affair for the city to be authorized to provide financing for airport purposes pursuant to the provisions of Section 1220 of the Charter of the City of San José.

(Ord. 26340.)

Part 2

DEFINITIONS

Sections:

*Charter references— For Charter provisions on revenue bonds for airport facilities, see Charter § 1220; for the Revenue Bond Law of 1941, see Gov. Code § 54300 et seq.

• 4.38.260 Financing agreement.

The definitions set forth in this part shall govern the application and interpretation of this chapter.

(Ord. 26340.)

"Acquisition" and its variants means the acquisition of any land or improvement constituting a component of the airport. (Ord. 26340.)

"Airport" means, to the extent permitted by the Charter, improvements, buildings, systems, plants, works, facilities or other undertakings used or useful for the purpose of providing public airports and facilities appurtenant or otherwise related thereto.

(Ord. 26340.)

"Bonds" means any bonds, notes, interim certificates, debentures or other obligations or other evidences of indebtedness issued by the city pursuant to this chapter, which are payable exclusively from revenues and other funds permitted by this chapter.

(Ord. 26340.)

"Construction" and its variants means the construction, improvement, furnishing, equipping, remodeling, repairing, reconstruction or rehabilitation of any component of the airport. (Ord. 26340.)

"Costs" means, with reference to the airport or any component thereof, any or all of the costs

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§ 4.38.270

incurred for the acquisition or construction of the airport, including without limitation the following:

• A. Obligations incurred for labor and materials in connection with the acquisition or construction of any component of the airport;

• B. The cost of acquisition 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 of any component of the airport;

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

• D. The cost of contract bonds and of insurance of all kinds that may be required or necessary during the course of the acquisition or construction of any component of the airport;

• E. All costs of engineering, legal and consultant services, including the costs 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 or construction of any component of the airport;

• F. All costs incurred in connection with proceedings by the city necessary to comply with an act commonly referred to as the California Environmental Quality Act or the National Environmental Policy Act or similar laws or regulations, as such act has been amended and supplemented from time to time;

• G. All amounts required to fund any reserve funds for bonds and any interest on bonds becoming due and payable during a period established by the council;

• H. All costs of issuance of the bonds, including but not limited to, legal and consulting fees and disbursements, trustee fees,

advertising and printing costs, costs of preparation and reproduction of documents, recording fees, the fees incurred with respect to obtaining any credit enhancement, liquidity facility, interest rate exchange agreement and any letter of credit;

• I. All costs which the city shall be required to pay, under the terms of any contract or contracts, for the acquisition or construction of any component of the airport;

• J. The refinancing of any existing indebtedness issued to finance or refinance the airport; and

• K. Any sums required to reimburse the city for advances made for any of the above items or for any other costs incurred for a lawful aviation-related purpose.

• (Ord. 26340.)

"Financing agreement" means a trust agreement or an indenture by and between the city and a corporate trustee or trustees, which may be any trust company or bank having the powers of a trust company within or without the state. (Ord. 26340.)

"Revenues" means all gross income and revenue received by the city from the ownership and operation of the airport, including all fees and charges received by the city for the services of the airport and all other income and revenue howsoever derived by the city from the ownership and operation of the airport or arising from the airport, and including all receipts derived from the investment of such income or revenues, including moneys deposited in a sinking, redemption or reserve fund or other fund pledged to secure the bonds or to provide for the payment of the principal of or interest on the bonds and such other moneys as the council may in its discretion make available therefor.

(Ord. 26340.)

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§ 4.38.300

Part 3

BOND ISSUANCE

Sections:

• 4.38.310 Issuance of bonds.

• 4.38.320 Financing agreement.

• 4.38.330 Terms of bonds.

• 4.38.340 Repayment of bonds. 4.38.350 Trust funds. 4.38.360 Purchase of bonds by city.

times, be in such denominations, be in such form, carry such registration privileges, be executed in such manner, be payable in such currency, at such place or places, and be subject to such terms of redemption as the resolution or financing agreement approved by the council may provide.

• B. The bonds may be issued as serial bonds or as term bonds, or both, or in any manner or form that the council, in its discretion, may determine.

• C. The bonds may be sold at either a public or private sale and for such prices as the council shall determine.

• (Ord. 26340.)

The city is authorized and empowered:

• A. To issue bonds for the purpose of financing the costs or otherwise assisting the acquisition or construction of any component of the airport authorized by this chapter.

• B. To establish the terms and conditions for financing the acquisition or construction of any component of the airport undertaken 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 airport or any portion thereof, as may be necessary in the judgment of the council for the successful financing of the airport and the issuance and sale of bonds.

• 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. 26340.)

• A. The bonds shall be authorized by resolution of the 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 or subject to compounding at such time or

In the discretion of the council, any bonds issued under the provisions of this chapter may be issued under and secured by a financing agreement, which may contain such terms as the council may determine.

(Ord. 26340.)

Any resolution or financing agreement authorizing any bonds or any issue of 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 revenues, subject to such agreements with bond owners as may then exist.

• 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 use and disposition of the revenues.

• 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,

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§ 4.38.400

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 procedure, 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 with respect to the bonds, and providing the rights and remedies of such owners in the event of default.

• H. Provision for the defeasance of the bonds and the discharge of the city's obligations with respect thereto.

• I. Such other terms and conditions pertaining to the issuance of the bonds as are deemed advisable by the council, including, but not limited to, the issuance of taxable obligations under Section 5900 et seq. of the Government Code of the State; and the execution and delivery of any interest rate exchange agreements pursuant to Section 5920 of the Government Code of the State.

(Ord. 26340.)

• A. Revenues, or any portion thereof, as designated in the resolution or financing agreement authorizing the issuance of the bonds, shall be the sole source of funds pledged by the city for repayment of bonds issued hereunder.

• B. Bonds issued hereunder shall not be deemed to constitute a debt or liability of the city or a pledge of the faith and credit of the city but shall be payable solely from revenues.

• C. The issuance of bonds shall not directly, indirectly or contingently obligate the council to levy or pledge any form of taxation, or to make any appropriation for their payment except from the revenues pledged to the payment of the bonds.

(Ord. 26340.)

• A. All moneys received pursuant to the provisions of this chapter, whether proceeds from the sale of bonds or revenues 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 financing 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.

• B. 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 or financing agreement authorizing the bonds.

• (Ord. 26340.)

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

(Ord. 26340.)

Part 4

CONSTRUCTION

Sections:

• A. This chapter, being necessary for the health, welfare and safety of the city and its residents, shall be liberally construed to effect its purposes.

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§ 4.38.400

• B. This chapter shall be deemed to provide a complete, additional and alternative method for doing the things authorized hereby, 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.

• (Ord. 26340.)

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. (Ord. 26340.)