HomeMy WebLinkAboutOrdinances Book 15, Page 347, No Ordinance Number34�
AN ORDINANCE OF THE CITY OF PADUCAH, KENTUCKY, REAFFIRMING
DETERMINATIONS PREVIOUSLY MADE THAT A PUBLIC PROJECT SHOULD BE UNDERTAKEN
IN THE INTERESTS OF THE PUBLIC HEALTH, SAFETY AND GENERAL WELFARE,
CONSISTING OF THE CONSTRUCTION AND INSTALLATION, WITH NECESSARY APPUR-
TENANCES, OF FACILITIES FOR THE PURPOSE OF RELIEVING THE PRESENTLY
OVERLOADED -COMBINED SANITARY AND STORM WATER SEWERS IN ORDER THAT THE
SAME MAY FUNCTION PROPERLY IN THE DRAINAGE OF POLLUTED SEWAGE WASTES
DURING PERIODS OF HEAVY RAINFALL, TOGETHER WITH EXTENSIONS, IMPROVEMENTS
AND ADDITIONS TO THE MUNICIPAL SANITARY SEWER SYSTEM FACILITIES IN AND
FOR SAID CITY AND ITS ENVIRONS; AUTHORIZING THE FINANCING THEREOF (TO
THE EXTENT FUNDS ARE NOT PROVIDED FROM OTHER SOURCES) THROUGH THE ISSUANCE
BY SAID CITY OF ITS $3,000,000 "SEWER SYSTEM REVENUE BONDS OF 1960
PAYABLE AS TO PRINCIPAL AND INTEREST SOLELY FROM THE REVENUES OF SUCH
SYSTEM; PROVIDING FOR THE CODLECTION AND SEGREGATION OF THE INCOME AND
REVENUES OF SUCH SYSTEM, AND THE ALLOCATION AND DISTRIBUTION THEREOF TO
VARIOUS SPECIAL FUNDS HEREIN CREATED, IN ORDER TO PROVIDE FOR THE ORDERLY
PAYMENT OF SUCH PRINCIPAL AND INTEREST, THE COSTS OF OPERATION AND
MAINTENANCE, AND THE ACCUMULATION AND MAINTENANCE OF PROPER RESERVES;
PRESCRIBING CONDITIONS AND RESTRICTIONS PURSUANT TO WHICH ADDITIONAL
BONDS PAYABLE FROM SUCH REVENUES MAY BE ISSUED IN THE FUTURE FOR
EXTENSIONS, IMPROVEMENTS AND ADDITIONS TO SUCH SYSTEM; AND PROVIDING
FOR AN ADVERTISED, PUBLIC COMPETITIVE SALE OF THE BONDS HEREIN AUTHORIZED
WHEREAS, the City of Paducah, situated in McCracken County,
Kentucky, has for many years owned and operated, and from time to time
added to, extended and improved, a system of sewer facilities, a
substantial portion of which was designed and installed for the
combined purposes of draining away not only sanitary sewage (polluted
wasres) but also�-storm or surface waters; and by reason of the natural
growth and development of said City, such combined sanitary and storm
sewers are now completely inadequate, so that upon the occasions of
heavy rains the same are constantly overloaded with storm waters in
such manner as to cause at numerous times and places substantial
overflows into streets and basements, sometimes standing for hours
at a time, containing polluted sewage wastes in proportions wholly
unacceptable according to public health standards and presenting a
constant menace and ever-present potential of epidemics of those
infectious diseases which are related to the presence df polluted and
contaminated sewage wastes, not only to the persons residing in the
immediate vicinity of such ponding areas but also to all other citizens
and inhabitants of said City and its environs; and
WHEREAS, said City has heretofore employed Messrs. Burns &
McDonnell, Consulting Engineers of Kansas City, Missouri, and has caused
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said Consulting Engineers to make extensive studies and surveys, and
to prepare and submit plans, recommendations, and cost estimates
relative to the ways in which said City may cope with and diminish
such menace to the public health, safety and general welfare, and
relative to such sanitary sewer extensions, additions and improvements
as are necessary to be undertaken at this time for the provision of
adequate and effective sanitary sewer service in additional areas
where such service has not heretofore been provided; and the findings,
reports and recommendations of said Consulting Engineers have been
submitted to and thoughtfully considered by the Mayor and Board of
Commissioners of said City, the City -County Health Officer, and
representatives of the State Board of Health and the Kentucky Water.
Pollution Commission; and
WHEREAS, said City has heretofore employed as its Fiscal
Agents Stein Bros. & Boyce and The Kentucky Company, Municipal Bond
Dealers, having offices in Paducah, Kentucky, and having wide experience
over a period of years in the financing of public projects and under-
takings throughout the Commonwealth; and the recommendations of said.
Fiscal Agents relative to the financing of the proposed and recommended
sewer facilities have been thoughtfully considered and discussed by
the Mayor and Board of Commissioners; and
WHEREAS, at regular meetings held on March 9, 1964, and May 26,
1964, the Board of Commissioners of said City adopted certain Resolutions
which were thereafter duly published in The Paducah Sun -Democrat, the
newspaper published in Paducah, Kentucky, and having the largest cir-
culation therein, and otherwise widely publicized in news articles,
editorials, and radio and television broadcasts, in substance deter-
mining that the recommended installations and facilities are urgently
needed and should be undertaken and carried forward with all reasonable
dispatch; and at a meeting of said Board of Commissioners held on July 21,
1964, final determinations were made (a) with regard to the scope of the
Project, (b) that the same be undertaken, (c) that financing thereof (to
the extent not otherwise provided) should be undertaken through the City's
issuance of its "Sewer System Revenue Bonds of -1964" in the principal
amount of .$3,000,000, the same to be payable as to principal and interest
solely from sanitary.sewer rates and charges imposed and collected for
use of the services and facilities of the municipal sewer system, as so
added to, extended and improved; (d) that the Consulting Engineers be
directed to proceed immediately in the extensive work of preparing working
drawings and specifications in.order that competitive construction pro-
posals may be eolicited by public advertising from time to time as quickly
as may be feasible; (e) that the Fiscal Agents, in conjunction with Bond
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Counsel_ retained by them on behalf of the City, cause to be prepared and
submitted for early consideration such ordinances and other proceedings
as may be necessary in the authorization and issuance of such revenue bonds
and in the establishment of increased rates and charges for sanitary sewer
service calculated to produce from theoperation of the municipal sewer
system and facilities income and revenues sufficient to provide -for the
payment of such revenue bonds and the interest thereon, as the bonds
and interest.coupons become due from time to time, and -also to provide
for the costs of operating said system, continuously maintaining the
same in a good state of repair, and making provision for adequate and
proper reserves for future extensions, additions and improvements and
for unforseen contingencies; and (f) announcing the purpose and intention
of the Mayor, and Board of Commissioners to proceed with diligence in
such.public.undertakings and the financing thereof (reference to said
previous proceedings being hereby made for details); and
WHEREAS, the City's Fiscal Agents have caused such ordinances
and other proceedings to be prepared and submitted, and the same have
been duly and thoughtfully examined and considered by the Mayor and
Board of Commissioners; and said Consulting_ Engineers have reported
that the preparation of working drawings and.specifications is in pro-
gress; and it is the opinion and -judgment of the Mayor and Board of
Commissioners that action should be taken at this time,
NOW, THEREFORE, THE BOARD OF COMMISSIONERS OF THE.CITY OF
PADUCAH, KENTUCKY,.DOES HEREBY ORDAIN, AS FOLLOWS:
SECTION 1_ The determinations heretofore made that the con-
struction and installation of.ess.ential public works and facilities con-
sisting of facilities for relief of overloaded and frequently overflowing
combined sanitary and storm water sewers, and extensions, additions and
improvements.to sanitary sewers in and for the City of Paducah and its
environs, substantially in accordance with the surveys, field reports,
specifications, feasibility reports and recommendations of the Consulting
Engineers, for.the purpose of providing adequate sanitary sewer service
in the.interests of the public health, safety and general welfare are
hereby ratified and confirmed, and it is declared that the same shall be
undertaken and financed according to authority of KRS.94.160, and of KRS
96.350 to 96.510, inclusive, which are incorporated herein by reference.
More specifically, said public project as referred to herein and to be
undertaken at this time, shall be substantially as summarized in "Table
No, 1," comprising Groups A,B,C and D set forth in the most recently up-
dated and submitted report of the Consulting Engineers, transmitted in a
letter to the Mayor under date of July 27, 1964, copies of which letter, and
of previous reports therein referred to, are on file in the office of
the City Manager and the City Clerk, subject to public inspection;
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reference being further made to Table No. 3, "Financing Project - Total
Bond Issue - $3,000,000" appearing on pages 2 and 3 of the Engineers'
aforesaid letter dated July 27, 1961, (exclusive of the storm or surface
water sewers referred to in Table 4 and "General Obligation Bonds, Phase B"
of Table 5, as recommended in earlier reports of the Engineers). Said
sewer installations and facilities, with all necessary appurtenances, are
determined to be urgently required in the public interests, shall con-
stitute a public and municipal undertaking of said City, and for conven-
ience are sometimes hereinafter referred to collectively as the "Project."
Said sewer system and facilities as presently to be added to, improved,
and extended, together with all future additions, improvements and exten-
sions thereof, are sometimes hereinafter referred to as the "System."
SECTION 2. For the purpose of providing funds (to the extent
not otherwise provided) to defray the costs of the said Project, to-
gether with all necessary and proper appurtenances, and expenses inci-
dent thereto, and expenses incident to the issuance of the Bonds herein-
after referred to, there are hereby authorized to be issued the
said City's "Sewer System Revenue Bonds of 1964" in the principal
amount of Three Million Dollars ($3,000,000), (hereinafter some-
times referred to as the ?Bonds"), consisting of 600 negotiable
coupon revenue Bonds, registrable as to principal only, each in
the denomination of Five Thousand Dollars ($5,000); with reservation
of right on the part of said City to issue additional bonds in the
future, payable from the income and revenues of said System, subject to
the conditions and restrictions hereinafter prescribed and set forth.
SECTION 3. That said Bonds, hereby authorized, shall be
numbered consecutively 1 to 600, inclusive; shall be dated September 1,
1964; shall mature as to principal in various amounts on September 1, in
each of the years 1965 to 2001, inclusive, as set forth in the schedule
appearing below; shall bear interest from their date until payment of
principal, such interest to the respective maturity dates to be
represented by semiannual interest coupons attached to the Bonds maturing
on March 1 and September 1 of each year, beginning March 1, 1965; such
interest to be at such rate or rates (not in excess of 6% per annum), as
may be established by a supplemental Ordinance or Resolution upon the
basis of competition among bidders upon the occasion of the advertised,
public competitive sale of the Bonds as hereinafter provided; the numbers
and principal maturities of said Bonds to be as set forth in the following
schedule:
BONDS NUMBERES
nclusi,e
1-6
7-13
14-20
21-27
28-34
35-42
-43-50 .
51-58
59-67
68-76
77-85
86-95
96-105
106-116
117-127
128-138
139-150.
151-162
163-175
176-188
189-202
203-216
217-231
232-247
248-263 .
264-280
281-298
299-316
317-335
336-355
356-375
376-396
397-418
419-441
442-465
466-490
491=516
517-543
544-571
572-600
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PRINCIPAL AMOUNT
DATE OF MATURITY
$30,000
35,000
September 1, 196,
35,000
September 1
35,000
September 13 196,
353000
September 1, 196E
40,000
September 1, 1965
40,000
September 1, 1970
40,000
September 1, 1971
45,000
September 1, 1972
45,000
September 1, 1973
45,000
September 1, 1974
50,000
September 1, 1975
55,000
55,000
September 1'976
1
September 1, 19 8
55,000
60 000
September
September 1, 1979
September 1, 1980
60,000
1, 1981
65,000
September 1, 1982
65,000
September 1, 1983
70,000
September 1, 1984
70,000
September 1, 1985
75,000
September 1, 1986
80, 000
September l; 1987
80000
September 1, 1988
85,000
September 1, 1989
90,000
September 1, 1990
9 000
September 1, 1991
1, 992
ptember
100'000
Se000 1tember
, 1993
100,000
_September 1 1994
105,000
September 1, 1995
110,000
..September 1, 1996
115,000
September 1, 1997
120 000
September. 1,.1998
125 000
September 1, 1999
130,000
September1, 2000
135,000
September 1, 2001
140,000
September 1, 2002
145,000
September 1, 2003
September 1, 2004
provided, however, that said Bonds numbered
77 to 600, inclusive,
(all Bonds maturing on and after September 1, 1975), shall be subject
to redemption at the option of said City prior to maturity in whole,
or from time to time in part in the inverse order of their maturities
(less than all of a single maturity to be selected by lot), on any
interest payment date on or after Se 1, 1974, and .in the event
any of said Bonds are called for redemption as aforesaid, notice
thereof identifying the Bonds to. be redeemed shall be given by publica-
tion at least once not less than thirty (30) days prior to the redemp-
tion date in a daily newspaper of general circulation throughout
Kentucky, and in a financial newspaper or ,journal of general circulation
among bond buyers.published in New_Yokk, New York (and by registered
istered Bonds to be redeemed), and
mail to the holders of any then reg .
it is further agreed that should any of said Bonds be called for
redemption prior to maturity as aforesaid, the City will pay.to the
respective holders, upon surrender of the Bonds, interest in addition
to that evidenced by interest coupons maturing on and prior to the
redemption date expressed in percentages of the principal amount as
set forth in the following schedule:
352
If Redeemed _Redemption Price
On and after September 1, 1974 and on or prior to March 1, 1979.. 103%
On and after September 1, 1979 and on or prior to March 1, 1984.. 102-1/2%
On and after September 1, 1984 and on or prior to March 1, 1989.. 102%
On and after September 1, 1989 and on or prior to March 1, 1994.. 101-1/2%
On and after September 1, 1994 and on or prior to March 1, 1999.. 101%
On and after September 1, 1999 but prior to final maturity....... 100-1/2%
Both principal of and interest on the Bonds shall be payable in lawful
money of the United States of America at the principal office of Citizens
Bank and Trust Company in the City of Paducah, McCracken County, Kentucky,
or, at the option of the holders, at the principal office of
in the City of State of Said Bonds
shall be executed by a reproduced facsimile of the signature of the
Mayor of said City, sealed with a reproduced facsimile of its corporate
seal, and.attested by the manual signature of the City Clerk, and the
interest couponsattached to said Bonds shall be executed with the
facsimile signatures of said Mayor and said City Clerk. If any officer
whose signature or a facsimile of whose signature appears on any bond
or coupon shall cease to be such officer prior to delivery, every such
signature, or facsimile signature, shall nevertheless be valid and
binding for all purposes, the same as if such officer had continued
in office until the time of delivery of such Bond or coupon. Signatures,
or facsimile reproductions of signatures, of any officer or officers
holding office at the time when such signatures or facsimile repro-
ductions are caused to appear on any Bond or coupon shall be valid and
effective for all purposes, whether or not such officers, or any of
them, were in office at the date of the Bonds. All of said Bonds,
together with the interest theeron, and any Bonds which may hereafter
be issued on a basis of parity therewith subject to the conditions and
restrictions hereinafter set forth, shall be payable only out of the
"Paducah Sewer System Bond and Interest Redemption Fund," hereinafter
created and established, and shall be a valid claim of the holders
thereof only against said fund and the fixed portion or amount of the
revenues of the said System of said City pledged to said fund.
SECTION '4. Said Bonds and appurtenant interest coupons shall
be fully negotiable, but upon presentation of any of said Bonds at the
office of the Citv Treasurer of the City of Paducah, McCracken County,
Kentucky, said Bonds may be registered as to principal in the name of
the owner on the books in said Treasurer's office, such registration to
be noted on the reverse side of the Bonds by the City Treasurer, and
thereafter the principal of such Bonds shall be payable only to the
registered holder, his legal representatives or assigns. Such regis-
353
tered Bonds shall be transferable to another registered holder, or
back to bearer, only upon presentation to the City Treasurer with a
legal assignment duly acknowledged or proved. Registration of any of
such Bonds shall not affect the negotiability of the interest coupons
thereto attached, but such coupons shall always be transferable by
delivery merely.
SECTION 5 Said Bonds and appurtenant interest coupons, and
provision for registration of the Bonds, shall be in substantially the
following forms, to -wit:
(FORM OF BOND)
UNITED STATES OF AMERICA
COMMONWEALTH OF KENTUCKY
COUNTY OF Mccracken
CITY OF PADUCAH
SEWER SYSTEM REVENUE BOND OF 1964
No.
$5,000.00
KNOW ALL MEN BY THESE PRESENTS:
That the City of Paducah, in the County of McCracken, and
Comm6nwealth of Kentucky,'for value received, hereby promises to pay to
bearer, or if this Bond be registered to the registered holder hereof,
as hereinafter provided, solely from the special fund hereinafter
identified, the sum of Five Thousand Dollars ($5,000.00) on the first
day of September, __, and likewise from said special fund to pay
interest on said sum from the date hereof until payment of principal
at the rate of per cent ( %) per amnum, payable semi-
annually on the first days of March and September in each year, be-
ginning on the first day of March, 1965, except as the provisions here-
inafter set forth with respect to redemption may be and become appli-
cable hereto, such interest as may accrue on and prior to the maturity
of this Bond to be paid only upon presentation and surrender of the
annexed interest coupons as the same severally mature, both principal
and interest being payable in lawful money of the United States
of America at the principal office of
in the City of Paducah, McCracken County, Kentucky, or, at the option
of the holder, at the principal office of
, in the City of
State of
This Bond is one of a duly authorized issue of Bonds, aggre-
gating $3;000,000, authorized by an Ordinance duly adopted and published
according to.law, issued for the purpose of defraving the costs of
constructing and installing extensions, additions and improvements to
the municipal sewer system of said City, and necessary appurtenant
facilities, and incidental expenses,"and this Bond has been issued
under and in full compliance with the Constitution and Statutes of
the Commonwealth of Kentucky, including among others, Section 94.160
354
and Sections 96.350 to 96.510, inclusive, of the Kentucky Revised St
A statutory mortgage lien which said City has recognized as
being effective upon issuance and delivery of any of the Bonds of tt
issue of which this Bond is a part, is created and granted by Sectic
96.400 of the Kentucky Revised Statutes for the benefit and protecti
of the holders of said Bonds, and the same shall continue as a first
upon the aforesaid municipal sewer system, and appurtenant facilities,
together with all future additions and improvements thereto, and exten-
sions thereof, and the revenues derived from the operation thereof,
until payment in full of all Bonds authorized and permitted to be
issued under the provisions of said Ordinance, including parity Bonds
if any be issued subject to the conditions and restrictions prescribed
in that connection in and by said Ordinance.
The Bonds numbered 77 to 600, inclusive (all Bonds maturing
on and after September 1, 1975), of the series of which this Bond is one
and as may be outstanding from time to time, are subject to redemption
at the option of said City prior to maturity, in whole or from time to
time in part in the inverse order of their maturities (less than all
of a single maturity to be selected by lot), on any interest payment
date on or after September 1, 1974, and in the event any of said Bonds
are called for redemption as aforesaid, notice thereof identifying the
Bonds to be redeemed will be given by publication at least once not
less than thirty (30) days prior to the redemption date in a newspaper
of general circulation throughout Kentucky, and in a financial newspaper
or journal of general circulation among bond buyers published in New
York, New York, (and by registered mail to the holders of any then
registered Bonds to be redeemed), and it is further agreed that should
any or all of sais Bonds be called for redemption as aforesaid, said
City will pay to the holders of the respective Bonds so called for
redemption, upon surrender thereof, interest in addition to that
evidenced by interest coupons maturing on and prior to the redemption
date expressed in percentages of the principal amount as set forth in
the following schedule:
If redeemed Redemption Price
On and after September 1, 1974 and on or prior to March 1, 1979... 103%
On and after September 1, 1979 and on or prior to "arch 1, 1984... 102-1/2%
On and after September 1, 1984 and on or prior to March 1, 1989... 102%
On and after September 1, 1989 and on or prior to March 1, 1994... 101-1/2%
On and after September 1, 1994 and on or prior to March 1, 1999... 101%
On and after September 1, 1999 but prior to final maturity ....... 100-1/2%
All of said Bonds as to which said City reserves and exercises the
right of redemption and as to which notice as aforesaid shall have
been given and for the redemption of which, upon the terms, aforesaid,
funds are duly provided, will cease to bear interest on the redemption
355
date.
This'Bond and the issue of which it forms a part, together
with such additional Bonds ranking on a parity therewith as may be
issued and outstanding from time to time under the conditions and
restrictions set forth in the Ordinance authorizing the issuance of
this Bond, are payable only from and secured by a pledge of and first
lien upon a fixed portion of the gross income and revenues to be
derived from the operation of said municipal sewer system, which fixed
portion shall be sufficient to pay the principal of and interest on
this Bond and the issue of which it forms a part as and when the same
become due and payable, and which shall be set aside as a special fund
for that purpose and identified as the "Paducah Sewer System Bond and
Interest Redemption Fund."
This Bond and the issue of which it forms a part do not
constitute an indebtedness of the said City of Paducah within the meaning
of any constitutional or statutory provisions or limitations. Said City
covenants that it will fix, and if necessary adjust from time to time,
such rates for use of the services and facilities of said municipal
sewer system, and will collect and account for income and revenues
therefrom, sufficient to pay promptly the interest on and principal of
this issue of Bonds, and all other Bonds ranking on a parity therewith
as may be issued and outstanding from time to time in accordance with
the conditions and restrictions prescribed in that connection, and also
to pay the costs of operation and maintenance of said system.
This Bond is fully negotiable but may be registered as to
principal only in the name of the holder on the books of said City in
the office of the City Treasurer of the City of Paducah, Kentucky, such
registration being noted hereon by said City Treasurer, after which no
transfer shall be valid unless such registered Bond be presented to
said City Treasurer with a legal assignment duly acknowledged or proved,
and such transfer is made on said books and similarly noted on the Bond,
but it may be discharged from such registration by being similarly
transferred and registered to 11 bearer, after which it shall be trans-
ferable by delivery, but it may be again registered as before. The
registration of this Bond as to principal shall not restrain the
negotiability of the coupons by delivery merely.
This Bond is exempt from taxation in the Commonwealth of Kentucky.
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts,
conditions, and things required to exist, happen and be performed pre-
cedent to and in the issuance of this Bond and the issue of Bonds of
which it is one, have existed, have happened, and have been performed
in due time, form, and manner as required by law; that the amount of
this Bond, together with all other obligations of said City, does not
356
exceed any limit prescribed by the Constitution or Statutes of the Common-
wealth of Kentucky; and that a sufficient portion of the income and
revenues of.said municipal sewer system has been pledged to.and will be
set aside into said special fund by said City for the prompt payment of
the principal of and interest on all Bonds which by their terms and by
the provisions of said Ordinance are payable therefrom, in addition to
proper provision for the costs.of operation and maintenance thereof.
IN WITNESS WHEREOF, said City of Paducah, Kentucky, has caused
this Bond to.be executed by a reproduced facsimile of the signature of
the Mayor of said City, and a reproduced facsimile of its corporate seal
to be hereunto affixed, attested by the manual signature of the City
Clerk, and the coupons hereto attached to be executed with the facsimile
signatures of said Mayor and said City Clerk,.and this Bond to be dated
the first day of September, 1964.
CITY OF PADUCAH, KENTUCKY
By (Facsimile Signature)
(FACSIMILE OF ,SEAL)
ATTEST:
No.
(Manual Signature)
City Clerk
(FORM OF COUPON)
*Unless the Bond to which this coupon is attached shall
have been called for prior redemption
$
On the first day of , the City of Paducah,
Kentucky, will pay to bearer Dollars ($ ) out of
its "Paducah Sewer System Bond and Interest Redemption Fund," at the
principal office of , in the
City of Paducah, McCracken County, Kentucky, or, at the option of the
holder, at the principal office of ,
in the City of , State of as provided in
and being interest then due on its Sewer System Revenue Bond of 1964,
dated September 1, 1964, Number
CITY OF PADUCAH, KENTUCKY
By (Facsimile Signature)
ATTEST:
(Facsimile Signature)
City Clerk
*(This redemption legend to appear only on coupons
maturing on and after March 1, 1975).
357
(FORM OF REGISTRATION TO BE PRINTED ON THE BACK OF EACH BOND
U
ate or ;
Registration
ame
d Cil
SECTION 6. The Bonds authorized by this Ordinance, (or any
amount thereof less than the amount herein authorized, as determined by
the Mayor in advice with the Fiscal Agents and Consultint-Engineers),
shall be publicly offered for sale according to a "Notice of Sale of Bonds"
conforming to the requirements of KRS Chapter 424 (and particularly KRS
6.24.140(3) and KRS 424.360), which shall be published one time,'not less
than seven (7) days nor more than twenty-one (21) days prior to the
date therein specified for the opening and consideration of purchase
bids, in each of the following: (a) The Paducah Sun -Democrat, a legal
newspaper published in Paducah, Kentucky, and having the largest circula-
tion therein, (b) The Courier -Journal, Louisville, Kentucky, a legal news-
paper having statewide circulation, and (c) The Daily Bona Buyer, New
York, New York, a financial newspaper or journal of general circulation
among bond buyers. In said published notice, bidders shall be notified
that bids must be for the entire amount of Bonds offered for sale, and
shall be for cash at not less than the face amount thereof, with
accrued interest to date of delivery; that they may specify an interest
rate or rates in multiples of 1/$ or 1/10 of 1%, provided none may
exceed 6% per annum, only one rate may be specified for Bonds of a
single maturity, and the City will not entertain any proposal that
interest becoming due on any Bond on any interest payment date be repre-
sented by more than one coupon. Each bidder shall be required to tender
a certified or bank cashier's check payable to the City of Paducah,
Kentucky, in a sum equal to 2% of the face amount of the Bonds offered for
sale, the same to be returned immediately after the opening of bids
to all unsuccessful bidders, and to be retained uncashed in the case of
the purchase bidder until the Bonds are delivered and paid for, at
which time, at the election of the purchaser, the City shall either cash
the good faith check and apply the proceeds thereof (but without interest
thereon) as a credit upon the purchase price, or shall return the good
faith check to the purchaser upon payment of the purchase price in full.
The right to reject bids shall expressly be reserved. The successful
bidder shall have the privilege of nominating, either in his bid, or
upon notice given in writing to the Mayor and the Fiscal Agents not
later than seven (7) days after the acceptance of the bid, an incorporated
state or national bank or trust company as an alternate place of payment
358
of principal and interest, providing the same must be a member of FDIC;
and if a bid is accepted and such nomination is made, the Board of
Commissioners will take appropriate action to designate such Alternate
Paying Agent; and if the successful bidder shall fail to submit a
nomination within such period of time, the Board of Commissioners will
itself designate an Alternate Paying Agent.
The Fiscal Agents are instructed to prepare a "Statement of
Terms and Conditions of Bond Sale," and to mimeograph, print or otherwise
reproduce the same in multiple copies, to be furnished to any interested
bidder upon request, and the same shall set forth the maturity schedule,
place or places of payment, redemption provisions, and other detailed
information with reference to the Bonds, and shall prescribe the manner
of bidding, and the manner of determining the bid which will be accepted,
in order to give assurance of uniformity in the submission of purchase
bids. An Official Bid Form shall also be provided.
SECTION 7, Upon issuance and delivery of any bonds authorized
by this Ordinance to be issued, all sums representing accrued interest
received from the purchaser or purchasers shall forthwith be deposited in
the "Paducah Sewer System Bond and Interest Redemption Fund," hereinafter
created and established, together with such additional sum from Bond pro-
ceeds as will cause the aggregate amount so deposited in said fund to be
equal to interest which will accrue on all outstanding Bonds to March 1,
1965, and the same shall be used and applied to the payment of interest
coupons becoming due on said date. There shall next be set aside and
paid from the proceeds of the Bonds all expenses incident to the autho-
rization, sale and delivery thereof, and the fees and expenses which
the City may have agreed to pay to the Fiscal Agents in connection
therewith.
The entire remaining balance of the proceeds of Bonds issued
hereunder shall constitute the "Sewer Construction Fund," hereby created,
and shall be deposited in a bank or banks which are members of Federal
Deposit Insurance Corporation (hereinafter sometimes referred to collec-
tively as the -!'Depository Bank"), and shall be applied to the extent
necessary and not otherwise provided, in payinp the costs of the Project.
Balances in excess of the amount insured by FDIC shall be secured at
all times as hereinafter provided.
There shall be deposited in said Sewer Construction Fund (for
convenience sometimes hereinafter referred to simply as the "Construction
Fund"), by the City Treasurer from time to time all moneys received from
any and all sources which are obtained for the purposes of the aforesaid
Project (except amounts received from the purchaser or purchasers of said
Bonds as representing accrued interest to delivery, and interest to be
set aside from Bond Proceeds, as above provided). A true and accurate
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separate accounting shall be made of all deposits in and disbursements
from said Construction Fund, and at no time shall there be any commingling
with other moneys of the City of Paducah, Kentucky.
Moneys from time to time'on deposit in said Construction Fund
shall be secured by a valid pledge to the City of Paducah, Kentucky, of
direct obligations of, or obligations the principal of and interest on
which are guaranteed by, the United States of America, having at all times
a market value (exclusive of accrued interest), at least equal to the
balance maintained on deposit therein. If at any time there shall be:on
deposit in said Construction Fund moneys in excess of the estimated dis-
bursements on account of the Project for the next ninety (90) days, the
Citv reserves the right to direct that the Depository Bank invest such
excess funds in direct obligations of, or obligations the principal of and
interest on which are guaranteed by, the United States Government, which
shall mature not later than eighteen (18) months after the date of such
investment and which shall be subject to redemption at any time by the
holder thereof. Earnings received from any such investments shall be
deposited by the City in the Construction Fund. Any moneys remaining in
the Construction Fund after all costs of the project have been paid, as
certified by the Consulting Engineers, shall be'transferred from the
Construction Fund and deposited in the "Sewer Depreciation Fund," herein-
after created; provided, however, that if the amount so available shall
exceed $360,000, the excess over $360,000 shall be deposited in the
"Bond and Interest Redemption Fund," hereinafter created, and shall be
credited to the "Debt Service Reserve" therein, for which provision is
hereinafter made, but if the amount so available for deposit in said Debt
Service Reserve shall be more than sufficient to fill such Debt Service
Reserve to the amount prescribed to be accumulated and maintained there-
in, any excess of Bond proceeds still remaining shall be deposited in
the aforesaid."Sewer Depreciation Fund" as in the case of the first
$360,000 of excess Bond proceeds.
. Disbursements from said Construction Fund shall be made by checks
signed.by the City Treasurer and -countersigned by the Mayor, but only if
accompanied and supported by one or'more vouchers signed by or on behalf
of the Engineer or firm of Engineers having supervision of construction of
said Project affirming that the payee"of the check is entitled to payment
of the amount thereof for labor, material or services earned and due
under the terms of an authorized contract relating to said Project.
.Pending disbursements for the authorized purposes, the proceeds
of all Bonds at any time issued pursuant to this Ordinance shall be sub-
ject to a first and paramount lien and charge in favor of the holders of
Bonds issued and outstanding hereunder, and for their further security.
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In the event that the amount hereinabove provided to be set
aside from Bond proceeds for payment of interest, together with revenues
of the System available for such purpose, shall prove to be insufficient
for payment of interest on the Bonds during the period anticipated to be
required for the construction and development of the System, additional
moneys may be transferred from the said Construction Fund to the "Paducah
Sewer System Bond and Interest Redemption Fund," hereinafter created, and
so applied, inasmuch as interest during such period"is a proper part of
the cost of the Project; provided, however, the aggregate amount of Bond
proceeds set aside for such purpose from Bond proceeds shall not exceed
interest accruing on the Bonds for the first three (3) years from the date
of the Bonds, as provided in KRS 96.400.
SECTION 8. From and after issuance and delivery of any Bonds
herein authorized or permitted to be issued and so long as any thereof
remain outstanding and unpaid, the said System shall be operated on a
fiscal year basis beginning each September 1, and ending on the next
August*31, and on that basis the income and revenues shall be collected,
segregated, accounted for and distributed, as follows:
(A) A separate and special fund or account of said City, dis-
tinct and apart from all other funds and accounts, is hereby created, and
is designated and identified as the "Paducah Sewer System Revenue Fund"
(hereinafter sometimes referred to as the "Revenue Fund"), which shall be
maintained with a bank in Paducah, Kentucky, which is a member of Federal
Deposit Insurance Corporation (hereinafter sometimes referred to as
"FDIC"), and said City covenants and agrees that it will deposit therein,
promptly as received from time to time, all cash revenues of the System
as defined in Section $(D) of this Ordinance. The moneys in the Revenue
Fund from time to time shall be used and disbursed and applied by said City
only for the.purposes, and in the manner and order of priorities, specified
in the succeeding subsections of this Section .$, all as permitted by
applicable statutes, as follows:
(B) A separate and special fund or account of said City is here-
by created, distinct and apart from all other funds and accounts, and the
same is hereby designated and identified as the "Paducah Sewer System Bond
and Interest Redemption Fund," (hereinafter for convenience sometimes re-
ferred to as the "Bond Fund"), which shall continuously be maintained so
long as any of the Bonds herein authorized or permitted to be issued are
outstanding, in a bank which is a member of FDIC; and all moneys deposited
therein from time to time shall be used and disbursed and applied, and are
hereby irrevocably pledged, solely for the purpose of paying the principal
I
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of and interest on such Bonds as may be issued and outstanding from time
to time pursuant to the provisions of this Ordinance, including parity
Bonds, if any are issued.
The City shall deposit in.said Bond Fund all.sums received from
any purchaser or purchasers of Bonds issued hereunder as representing
accrued interest.on such Bonds to date of delivery, together with such
additional sum from Bond proceeds, as hereinabove provided, as will cause
the aggregateamount so deposited in,the Bond Fund to be equal to interest
which will accrue and be payable on the outstanding Bonds on March 1,
1965; and the amount so deposited shall.be applied to payment of interest
coupons maturing on said date. Thereafter, the City shall transfer from
the Revenue Fund to the Bond Fund on or before the 15th day of each
month, sums not less than:
(i), beginning on the 15th day of the first month after issuance
of the Bonds, and continuing until August 15, 1965, such
proportionate monthly sums as will be sufficient to accumulate
in the Bond Fund not later than August 15, 1965, a sum equal
to the principal amount of all outstanding Bonds which will
become due and payable on September 1, 1965;
(ii) beginning March 15, 1965, a sum equal to one-sixth (1/6) of
the next succeeding_ interest installment to become due on
all Bonds then outstanding;
(iii) beginning September 15, 1965, a sum equal to one -twelfth (1/12)
of the principal of all Bonds maturing on the next succeeding
September 1; and
(iv) beginning March 15, 1965, an additional sum equal to one
one -hundred -twentieth (1/120).of the aggregate amount..of the
principal of and interest on all outstanding Bonds maturing
on the ensuing September 1 and March 1, computed as of
March 1 in each year;
PROVIDED, HOWEVER, That all sums deposited in the Bond Fund in
excess of semiannual interest payments and annual principal payments of
the Bonds, shall constitute and accumulate within the Bond Fund as a
Debt Service Reserve, hereby created, until such time as there shall be
accumulated in such Reserve a sum equal to not less than the average of
the amounts necessary to provide for payment, when due, of both principal
of and interest on all outstanding Bonds during all subsequent fiscal
years to final maturity; and thereafter the aforesaid monthly deposits
referred to in (iv) above may be suspended, but shall be resumed when-
ever authorized disbursements from the Debt Service Reserve shall reduce
the balance therein below the amount hereinabove prescribed, and shall
be continued for such period of time as mau be required to restore and
maintain the balance therein at such prescribed level.
In the event parity Bonds are issued pursuant to the conditions
and restrictions hereinafter prescribed in that connection, the monthly
deposits shall be adjusted as provided in Section 10 of this Ordinance.
Moneys from time to time in the Debt Service Reserve may be
held in cash, in which event the same shall be secured by a valid pledge
362
of direct obligations of, or obligations the principal of and interest on
which are guaranteed by, the United States Government, having at all
times an equal market value; or the same, or any part thereof, may, upon
order of the Board of Commissioners be invested and reinvested in
interest-bearing obligations of, or obligations the principal of and
interest on which are guaranteed by, the United States Government, matur-
ing or subject to redemption at the option of the holder not later than
five (5) years from date of investment or the final maturity date of Bonds
outstanding pursuant to this Ordinance, whichever date is the earlier.
Income from any such investments shall be accumulated in said Debt Service
Reserve, and may be invested in the same manner. Withdrawals shall be
made from the said Debt Service Reserve, and transferred to the Bond Fund,
if and to any extent required at any time to prevent default in the pay-
ment of principal of or interest on any Bonds which by their terms are
payable from said Bond Fund; and if necessary, securities held as invest-
ments in said Debt Service Reserve shall be converted into cash for such
purpose; but no.withdrawals therefrom shall be made for any other purposes,
and the City hereby irrevocably pledges all moneys and securities in the
Debt Service Reserve for such purposes only. In the event any such per-
mitted withdrawals are made, the deficiency in said fund shall be
restored as soon as revenues are available, and as above set forth.
When such amount of the Bonds at any time issued and out-
standing pursuant to this Ordinance shall have been retired, as that the
amount then held in said Debt Service Reserve is sufficient to provide
for payment in full of all such Bonds remaining outstanding and unpaid,
no further deposits shall be required to be made into or for the account
of sbdd Debt Service Reserve; and in such event the Debt Service Reserve
may be applied to the payment and retirement of all such outstanding
Bonds, whether by redemption or purchase, notwithstanding any other
provision hereinabove made concerning the use and application of said
Debt Service Reserve.
(C) A separate and special fund or account of said City is
hereby created, and the same is hereby designated and identified as the
"Sewer Operation and Maintenance Fund," which shall be maintained in
a bank which is a member of FDIC.
After observing the priority of deposits set forth in (b) above
there shall be deposited in this fund monthly from the Revenue Fund,
a sum equal to the anticipated costs of operating and maintaining the
System for the next ensuing month, according to the Budget for which
provision is hereinafter made, together with an amount sufficient to
meet any unforseen deficit in payment of the costs of operating and
maintaining the System during the previous month; and moneys deposited
from time to time in the said "Sewer Operation and Maintenance Fund"
shall be used and applied for such purposes.
363
(D) A separate and special fund or account of said City is
hereby created, and is hereby designated and identified as the "Sewer
Depreciation Fund" (hereinafter sometimes referred to simply as the
"Depreciation Fund"), which shall be maintained in a bank which is a
member of FDIC.
After observing the priority of deposits set forth in (B) and
(C) above, there shall be transferred from the Revenue Fund each month
and deposited in the Depreciation Fund the sum of $1,600 (or so much
thereof as may be available), and any excess Bond proceeds remaining
after payment in full•of all costs of the Project, to the extent
particularly set forth in Section 7 of this Ordinance.
In addition to the above deposits from the Revenue Fund (and
from surplus Bond Proceeds, if any), there shall also be deposited in
the Depreciation Fund, as received, such connection fees or charges as
may be exacted from -users of the System, the proceeds of all property
damage insurance (except public liability) maintained in connection with
the System, and the cash proceeds of any surplus, worn out or obsolescent
properties of the System, if the same be sold upon order of the Board
of Commissioners according to the conditions hereinafter prescribed in
that connection. The term "cash revenues" of the System, as used in
Section 8 hereof, means all proceeds of service charges, and does not
include the cash items enumerated inthis paragraph.
The Depreciation Fund shall be available and may be withdrawn
and used by the City, upon appropriate certification of need, for the
purpose of paying the cost of unusual or extraordinary repairs, renewals
or replacements, not included in the Annual Budget of Operating Expenses,
and the cost of constructing extensions, additions and improvements to
the System which will either enhance its revenue-producing capacity or
provide a higher degree of existing or prospective service.
If and when the balance in the Depreciation Fund, including
the market value of investments held for the account thereof, shall
equal the sum of $360,000, and so long as such balance shall remain at
said sum, constituting a reserve for application to any of the enumerated
purposes of the Depreciation Fund, any excess may be used and applied
upon order of the Board of Commissioners (a) to provision of a reserve
in the Sewer Operation and Maintenance Fund equal to the anticipated
costs of operating and maintaining the System for a period of three (3)
months, and thereafter (b) to the redemption of Bonds outstanding pursuant
to this Ordinance in accordance with their terms, or for the purchase and
retirement thereof upon terms no less advantageous to the City than the
then current.terms of redemption.
364
At any time when the accumulations in the Depreciation Fund
shall exceed anticipated and foreseeable needs for authorized purposes,
all or any portion of such excess may be invested and reinvested upon
order of the Board of Commissioners in interest-bearing obligations of,
or obligations the principal of and interest on which are guaranteed by,
the United States Government, maturing or subject to redemption at the
option of the holder not later than three (3) years after the date of
investment; but as and when funds may be required for authorized purposes
a sufficient portion thereof shall be converted into cash and so applied.
All investments for the account of the Depreciation Fund shall be carried
to the credit of said Fund; all income from investments and any profit
from the sale thereof shall be credited thereto; and any expenses
incident to investment or reinvestment, together with any loss from
forced conversion of investments into cash, shall be charged thereto.
All payments into the above special funds shall be made on or
before the fifteenth (15th) day of each month, except that when the
fifteenth day of any month shall be a Sunday or a legal holiday then
such payment shall be made on the next succeeding business day.
All moneys held in any of the above special funds shall be
kept apart from all other municipal funds and shall be deposited in a
bank or banks which are members of FDIC, and all such deposits which
cause the aggregate of all deposits of the City in any bank to be in
excess of the amount secured by FDIC, shall (unless invested as herein
authorized) be secured by a surety bond or bonds or by pledge of direct
obligations or by guaranteed bonds or securities of the United States
Government having a market value equivalent to such deposit.
SECTION 9. The said City hereby irrevocably covenants and
agrees with the holder or holders of any and all Bonds at any time
issued and outstanding pursuant to authority of this Ordinance, that
so long as the same or any part thereof or interest thereon remain
outstanding and unpaid:
(A) It will faithfully and punctually perform all
duties with reference to said System and Project required by
the Constitution and laws of the Commonwealth of Kentucky,
and by the terms and provisions of this Ordinance.
(B) It will at all times operate said System on a
revenue-producing basis, and will permit no free services
to be rendered or afforded thereby.
(C) It will maintain the said System in good condition
through application of revenues accumulated and set aside for
operation and maintenance, as herein provided; and will make
unusual or extraordinary repairs, renewals and replacements,
as the same may be required, through application of moneys
accumulated and set aside into the Depreciation Fund.
(D) The City covenants and agrees that, so long as any
of the Bonds are outstanding, it will not sell or otherwise
dispose of any of the System facilities or any part thereof,
and, except as provided for in this Ordinance, it will not
365
create or permit to be created any charge or lien on the
revenues thereof ranking equal or prior to the charge or
lien of these Bonds. Norwithstanding the foregoing, the City
may at any time permanently abandon the use of, or sell at
fair market value, any of its System facilities, provided that:
(i) It is in compliance with all covenants and
undertakings in connection with all of its Bonds or
other obligations then outstanding and payable from
the revenues of the System, and the Debt Service
Reserve for the Bonds has been fully established, or
is being accumulated by monthly deposits as in this
Ordinance provided;
(ii) It will, in the event of sale, apply the
proceeds to either (1) redemption of outstanding Bonds
in accordance with the provisions governing redemption
of.Bonds in advance of maturity, or (2) replacement of
the facility so disposed of by another facility which
shall be incorporated into the System as hereinbefore
provided;
(iii) It certifies, prior to any abandonment of
use, that the facility to be abandoned is no longer
economically feasible of producing net revenues; and
(iv), It certified that the estimated net revenues
of.the remaining System facilities for the then next
succeeding fiscal year, plus the estimated net revenues
of the facility, if any, to be added to the System,
satisfy the earnings test hereinafter provided in
governing_ issuance of additional Bonds.
(E) It will establish, enforce, and collect rates and
charges for services rendered and facilities afforded by said
System;•and the same shall be reasonable and just, taking into
account and consideration the cost and 'value of the System,
the costs of operating the same and maintaining it in a good
state of repair, proper and necessary allowances for depreciation
and for additions and extensions, the amounts necessary. for the
orderly retirement of all outstanding Bonds and the accruing
interest rhereon, and theaccumulation of reserves as herein
prer
provided; and such rates and charges shall be adequate er meet
all'such requirements -as provided in this Ordinance, and shall,
if necessary, be adjusted from time to .time in order to comply
herewith.
On or beford the inception of initial operation of
the Project additions to the System, the City will adopta
budget of Operating Expenses for the System for the remainder
of the then current fiscal year of the System, and thereafter,
on or before the first day of each fiscal. year so long as any
Bonds are outstanding, it will adopt an Annual Budget of
Operating Expenses for the ensuing fiscal year, and will file
a copy of each such Budget, and of any amendments thereto, in
the -office of the City Clerk, and furnish copies thereof to
the holder -of any Bond .upon request. The term "Operating
Expenses, as herein used, includes all reasonable and necessary
costs of operating, repairing, maintaining, and insuring the
System, but shall exclude any allowance for depreciation, pay-
ments into the Depreciation Fund for extensions, improvements,
and extraordinary repairs and maintenance, and payments into
the Bond Fund and the Debt Service Reserve. TheCity covenants
that the Operating Expenses incurred in any year will not exceed
the reasonable and necessary amounts therefor, and -that it will
not expend any.amount-or incur any obligations -for operation,
maintenance and repairs in -excess of the amounts provided for
Operating Expenses -in the Annual Budget, except upon resolution
or ordinance duly adopted by -the Board of Commissioners deter-
mining that such expenses are necessary in order to operate
and maintain the System. At the same time, and in like manner,
the City agrees that it will prepare an estimate of gross
revenues to be derived from operation of the System for each
fiscal year, and to the extent that said gross revenues are
insufficient to provide for all payments required to be made
into the Bond Fund during such ensuing fiscal -year, and to
build up and maintain the reserves specified and enumerated
in -Section 8 of this Ordinance, and to pay Operating Expenses,
the City covenants and agrees that it will revise its rates
and charges for services rendered by the System, so that the
same will be adequate to meet all of such requirements.
366
(F) It will not at any time make any reduction in any
Prevailing schedule of rates and charges for use of the
services and facilities of the System, without first obtaining
the written determination of a Consulting Engineer of national
reputation that the proposed reduction will not adversely
affect the ability of the City to meet all the requirements
set forth in this Ordinance.
(G) It will at all times segregate the revenues of
the System from all other revenues, moneys, and funds of
the City, and will rpomptly and regularly make application
and distribution thereof into the special funds provided
in this Ordinance in the manner and with due regard for the
priorities herein attributed thereto.
(H) It will keep proper books of record and account,
separate and clearly distinguishable from all other municipal
records and accounts, showing complete and correct entries
of all transactions relating to said System, and the same
shall be available and open to inspection by any Bondholder,
and any agent or representative of a Bondholder.
(I) It will, within ninety (90) days after the end of
each fiscal year, cause an audit to be made of the books of
record and account pertinent to the. System, by an independent
state -licensed accountant not in the employ of the City on
a monthly salary basis, showing all receipts and disbursements,
with comments of the auditor concerning whether the books and
records are being kept in compliance with this Ordinance and
in accordance with recognized accounting practices, and will
promptly mail a copy thereof to the original purchaser or
purchasers of Bonds issued hereunder.. If requested to do so,
the City will furnish to any Bondholder a condensed form of
the Balance Sheet, and.a condensed form of the Operating
Report, in reasonable detail. All expenses incurred in
causing such audits to be made, and copies distributed,
shall constitute proper expenses of operating and maintaining
the System, and may be paid from.revenues allocated for such
purposes, as herein provided.
(J) Any holder of saidBonds, or of any of the coupons,
may either at law or in equity,.by suit, action, mandamus,
or other proceedings, enforce and compel performance by said
City and its officers and agents of all duties imposed or
required by law or this Ordinance in connection with the
operation of said System,.including the making and collecting
of sufficient rates and segregation of the revenues and
application thereof.
(K) If there be any default in the payment of the
principal of or.interest on any of said Bonds, then upon
the filing of suit by any holder of said Bonds or any of
the coupons, any court having ,jurisdiction of the action
may appoint a receiver to administer.said.System on behalf
of the City with power to charge and collect rates sufficient
to provide for the payment of any.Bonds or obligations out-
standing against said.System, and for the payment of Operating
Expenses, and to apply the revenues in conformity with this
Ordinance and the.provisions of said statute laws of Kentucky
aforesaid.
(L), The City will cause each municipal officer or other
person (other than depository banks) having custody of any
moneys administered under the provisions of this Ordinance to
be bonded at all times in an amount at least equal to the
maximum amount of such moneys.in his custody at any time;
each such bond to have surety given by a surety corporation
qualified to do business in Kentucky and approved by the Board
Of Commissioners, and the premiums for such surety shall
constitute a proper expense of operating the System, and may
be paid from moneys available in the "Operation and Main-
tenance Fund."
(M) It will procure, and at all times maintain in force,
insurance of all insurable properties constituting parts of,
or being appurtenant to, the System,.to the full insurable
value thereof, against damage or destruction by fire, wind-
storm, and the hazards covered by the standard "extended
coverage" policy endorsement or provisions, the premiums
therefor to be paid from the Operation and Maintenance Fund;
and will deposit all sums collected under the terms of such
Policies in the Depreciation Fund.
367
(N) The City covenants and agrees that according to
authority of KRS 96.930, et seq., it will provide that water
service to any premises (whether such water service be furnished
by a privately -owned utility company or by a municipally -owned
water system) shall be discontinued upon delinquency of payment
to the City for sanitary sewer service charges to the same
premises, according to such reasonable contracts or regulations
in that connection as may be effective from time to time.
(0) It will regularly employ from time to time a
Consulting Engineer or firm of -Consulting Engineers of national
recognition in the field, of sanitation engineering to make a
physical inspection of the System not less often than once
every five (5) years (and more often, if circumstances so require,
in the judgment of the Board of Commissioners), and to file in
the office.of the -City Clerk a written report of the physical
condition thereof, sufficiency,of maintenance practices, needed
repairs, replacements, renewals, additions, extensions, enlarge-
ments, acquisitions or new installations, if any, together with
a preliminary estimate of .the costs thereof and availability
of funds therefor,and such other comments as -may in the
opinion of the Engineer or Engineers be deemed necessary or
appropriate. Such written reports shall be kept on file in
the office of the CityClerk subject to inspection at all
reasonable times by any holder of bonds or other obligations of
the Cuty relating to the System, and a complete copy of each
such reoort shall be furnished without demand to the original
purchasers of Bonds at each public sale thereof.
SECTION 10. The Bonds authorized to be issued hereunder and
from time to time outstanding shall not be entitled to priority one
over the other in the application of the revenues herein pledged for
the payment thereof, regardless of the time or times of.their issuance,
it being the intention that there shall be no priority among the Bonds
authorized to be issued under the provisions of this Ordinance, regard-
less of the fact that they may actually be issued and delivered at
different times. No other bonds or other obligations shall be issued
by the City and made payable from the revenues of the System unless
the pledge of revenues for the same is expressly made subordinate and
inferior to the lien and pledge herein created; provided, however, said
City hereby reserves the right and privilege of issuing additional
bonds, from time to time, payable from the revenues of said System,
equally secured by the statutory mortgage lien upon the System,
provision for which is made in KRS 96.400 (said lien being hereby
acknowledged to be effective upon issuance of any Bonds under authority
of this Ordinance), and secured by a parity lien upon and ratably payable
from such revenues, for the purpose of adding to, extending, or
improving the System, provided in each instance that:
(i) the facility or facilities to be built from
the proceeds of the additional parity Bonds is or are made
a part of the System and its or their revenues are pledged
as additional security for the additional parity Bonds and
the outstanding Bonds;
(ii) the City is in compliance with all covenants
and undertakings in connection with all of its Bonds then
outstanding and payable from the revenues of the System or
any part thereof;
(iii) the annual net revenues, defined as gross sewer
service revenues less Operating Expenses (as defined in
Section 9 (e) hereof), of the System for a period of twelve (12)
368
consecutive months in the period of eighteen (18) months
immediately preceding the issuance of additional parity Bonds,
are certified by an independent state -licensed accountant not
employed by the City on a monthly salary basis, to have been
equal to at least one and twenty-five hundredths (1.25) times
the everage annual requirements for principal and interest on
all Bonds then outstanding and payable from the revenues of
the System, and the parity Bonds then proposed to be issued;
provided, however, that for the purposes of showing compliance
with the requirements of this paragraph, such showings of the
accountant may be adjusted by an Engineer or firm of Consulting
Engineers of national reputation in the.field.of sanitation
engineering (a) to reflect any increased sewer service rates
made effective prior to the issuance of such parity Bonds, and
(b) to reflect any additional net sewer service revenues which
will be produced through the operation of extensions, addi-
tions and improvements to be financed in whole or in part
through application of the proceeds of the proposed parity
Bonds, taking into account any increase or decrease of the
costs of operating and maintaining the System incident thereto,
but with respect to the adjustments permitted by this sub-
paragraph (b) only in the event that prior to the issuance of
such parity Bonds the City shall have entered into firm con-
tracts establishing that the costs of the proposed extensions,
additions.and improvements will not exceed the cost figures
used by the Engineers in making such computations.
The City hereby covenants and agrees that in the event addi-
tional series of parity Bonds are issued, it shall:
(i) .adjust the monthly deposits into the Bond Fund
on the same basis as that prescribed in Section $(B) hereof to
provide for the annual debt service on the additional Bonds;
(ii) adjust the amount of the Debt Service Reserve
to a sum equal to not less than the average annual debt service
on the Bonds then outstanding and such additional parity Bonds,
the additional Debt Service Reserve to be accumulated monthly
in the manner hereinbefore provided, over a period of not more
than ten (10) years from the issuance of such parity Bonds;
(iii) adjust the amount to be accumulated as a reserve
in tle Depreciation Fund on a basis proportionate to that pre-
scribed in Section $(D) hereof, taking into account the future
replacement cost of the facilities and equipment to be con-
structed or acquired with the proceeds of such additional
Bonds; and
(iv) make such additional Bonds payable as to principal
on September 1 of each year in which principal falls due, and
payable as to interest on March 1 and September 1 of each year;
and schedule the principal maturities of the parity Bonds in
such manner as to cause the aggregate annual principal and
interest requirements of the outstanding Bonds and the parity
Bonds to be as nearly equal as may be feasible, except in the case
of advance refunding according to the provisions hereinafter set
forth in that connection.
The additional parity Bonds (sometimes herein referred to as
"permitted" to be issued, the issuance of which is restricted and
conditioned by this Section, shall be understood to mean Bonds payable
from the revenues of said System on a basis of equality and parity with
the Bonds herein specifically authorized, and shall not be deemed to
include other bonds or obligations,.the security and source of payment
of which are subordinate and subject to the priority of the Bonds and
parity Bonds herein authorized to be issued. The City expressly re-
serves the right to issue its bonds or other obligations payable from
the revenues herein pledged, and not ranking of a basis of equality and
parity with the Bonds and parity Bonds herein otherwise referred to,
without any proof of previous earnings or net revenues, but only if such
bonds or other obligations are issued to provide for additions or exten-
sions or improvements of the System, and only if the same are issued in
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express recognition of the priorities, liens and rights created and
existing for the security, source of payment, and protection of the
said Bonds and parity Bonds herein authorized and permitted to be issued.
Nothing in this Section is intended or shall be construed to
prevent or restrict:
(A) the ordinary refunding of the initially authorized Bonds,
and/or of any parity Bonds which may have been issued and are outstand-
ing under the provisions of this Ordinance, if such refunding does not
operate toincrease; in any year until the final maturity of the out-
standing Bonds which are not refunded, the aggregate of the principal
and interest requirements of the Bonds to remain outstanding and the
Bonds which are refunded; or
(B) any refunding of the initially authorized Bonds, and/or
of any parity Bonds which may have been issued and are outstanding under
the provisions of this Ordinance, more than six (6) months in advance
of the earliest permissible redemption date of the outstanding Bonds
or parity Bonds which are to be refunded (hereinafter referred to as
"advance refunding"), if
(i) prior to the issuance of the refunding bonds
the City shall have elected to call the Bonds to be refunded,
for redemption on the earliest permissible redemption date in
accordance with the terms thereof, and shall have given notice
of such action as in this Ordinance provided; and
(ii) moneys sufficient for payment, when due, of the
principal of and interest on the Bonds to be refunded and any
premium or additional interest due upon the redemption date
are simultaneously with the issuance of the refunding bonds
deposited in a Special Escrow Account" in the Bond Fund, are
irrevocably pledged exclusively for the payment, redemption
and retirement of the Bonds to be refunded, and are invested
for the account of such Special Escrow Account either in
United States Governemtn securities or in Certificates of
Time Deposit issued by an incorporated state or national bank
or trust company and fully and continuously secured to maturity
by a valid pledge of United States Government securities having
an aggregate market value not less than the face amount of
such Certificates; and
(iii) the assured interest income from such invest-
ments is irrevocably pledged to be paid as received from time
to time into the Bond Fund as in the case of revenues from
sanitary sewer service charges otherwise pledged to be set
aside and deposited therein;
in which event the ag#regate of the principal and interest requirements
of the Bonds to remain outstanding and the refunding bonds so issued may,
in any year or years until such redemption date, exceed the aggregate of
the annual principal and interest requirements prevailing in the absence
of such advance refunding, by the amount of the pledged interest income
from such investments to be received and paid into the Bond Fund during
such year or years.
SECTION 11. The provisions of this Ordinance shall constitute
a contract between the said City of Paducah and the holders of the Bonds
herein authorized and permitted to be issued, and after the issuance of
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any of the Bonds no change, variation, or alteration of any kind of the
Provisions of this Ordinance shall be made in any manner except as herein
provided until such time as all of the said Bonds issued hereunder, and
the interest thereon, have been paid in full.
SECTION 12. If any section, paragraph, clause or provision of
this Ordinance shall be held invalid, the invalidity of such section,
paragraph, clause or provision shall not affect any of the remaining
provisions of this Ordinance.
SECTION 13. All ordinances, resolutions and orders, or parts
thereof, in conflict with the provisions of this Ordinance, are, to the
extent of such conflict, hereby repealed.
SECTION U. This Ordinance shall be in full force and effect
from and after its adoption, signature, attestation, and publication as
provided by law.
INTRODUCED AND GIVEN FIRST READING APPROVAL by the Board of
Commissioners of the City of Paducah, Kentucky, at a meeting held on the
11th day of August, 1964, and ordered held over in the office of the
City Clerk, subject to public inspection, pending further consideration
by the said Board of Commissioners.
-FINALLY ADOPTED ON SECOND READING BY THE BOARD OF COMMISSIONERS
OF THE CITY OF PADUCAH KENTUCKY at a meeting held on the 18th day of
August, 1964, on the same occasion signed in open session by the
Mayor, attested under seal by the City Clerk, and ordered to be published
in The Paducah Sun -Democrat, Paducah, Kentucky, on the earliest possible
date.
SEAL
2c)�� G(Jy�Ja��eli
ayor
City o£ Paducah, Kentucky
AT T:
City Clerk