The following ordinance, having been previously introduced at a duly convened regular meeting on February 8, 2021, and laid over with a public hearing held in connection therewith on this date, was offered for final adoption by Terry and seconded by Watson.
WATER BOND ORDINANCE 20210308
An ordinance authorizing the issuance of Two Hundred Thousand Dollars ($200,000) of Water Revenue Bonds, Series 2021, of the Village of Harrisonburg, State of Louisiana; prescribing the form, fixing the details and providing for the payment thereof; providing for the sale thereof and entering into certain other covenants and agreements in connection with the security and payment of said Bonds; and providing for other matters in connection therewith.
WHEREAS, the Village of Harrisonburg, State of Louisiana (the “Issuer”), presently owns and operates a waterworks system (the “System”); and
WHEREAS, this Mayor and Board of Aldermen of the Village of Harrisonburg, State of Louisiana (the “Governing Authority”), wishes to pay a portion of the costs of constructing and acquiring improvements, extensions, renovations and replacements to the System, including equipment, fixtures and accessories therefor, both personal and real, a work of public improvement for the Issuer, through the issuance of Two Hundred Thousand Dollars ($200,000) of Water Revenue Bonds, Series 2021, of the Issuer (the “Bonds”), said Bonds to be payable from the income and revenues derived or to be derived from the operation of the System, in accordance with the provisions of R.S. 39:524 and the other applicable provisions of Part II of Chapter 4 of Subtitle II of Title 39 of the Louisiana Revised Statutes of 1950, as amended, and other constitutional and statutory authority; and
WHEREAS, the Issuer presently has no outstanding indebtedness payable from a pledge of the income and revenues of the System; and
WHEREAS, this Governing Authority now proposes to fix the details necessary with respect to the issuance of the Bonds and to provide for the sale, authorization and issuance thereof;
NOW, THEREFORE, BE IT ORDAINED by the Mayor and Board of Aldermen of the Village of Harrisonburg, State of Louisiana, acting as the governing authority of the Issuer, that:
SECTION 1. The following terms as used in this Ordinance shall have the following respective meanings, unless the context otherwise requires:
“Act” means, collectively, R.S. 39:524 and the other applicable provisions of Part II of Chapter 4 of Subtitle II of Title 39 of the Louisiana Revised Statutes of 1950, as amended, and other constitutional and statutory authority.
“Agreement” means the agreement to be entered into between the Issuer and the Paying Agent pursuant to this Ordinance, if required.
“Bond” or “Bonds” means the Water Revenue Bonds, Series 2021, of the Village of Harrisonburg, State of Louisiana, authorized to be issued by this Ordinance in the aggregate principal amount of $200,000, whether initially delivered or issued in exchange for, upon transfer of, or in lieu of any previously issued Bond.
“Bond Register” means the records kept by the Paying Agent at its designated office in which registration of the Bonds and transfers of the Bonds shall be made as provided herein.
“Code” means the Internal Revenue Code of 1986, as amended.
“Executive Officers” means, collectively, the Mayor and the Clerk of the Issuer.
“Fiscal Year” means the accounting period beginning July 1 of each year or such accounting period as may be designated by the Governing Authority as the fiscal year of the Issuer.
“Governing Authority” means the Mayor and Board of Aldermen of the Village of Harrisonburg, State of Louisiana, or any legal successor thereto.
“Government Securities” means direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America, which are non-callable prior to their maturity and which may be United States Treasury Obligations such as the State and Local Government Series and may be in book-entry form.
“Interest Payment Date” means April 1 and October 1 of each year, commencing October 1, 2021, until the Bonds are paid.
“Issuer” means the Village of Harrisonburg, State of Louisiana.
“Ordinance” means this ordinance authorizing the issuance of the Bonds, as it may hereafter be amended or supplemented.
“Outstanding” when used with respect to the Bonds means, as of the date of determination, all Bonds theretofore issued and delivered under this Ordinance, except:
(a) Bonds theretofore cancelled by the Paying Agent or delivered to the Paying Agent for cancellation;
(b) Bonds for the payment or redemption of which sufficient funds have been theretofore deposited with the Paying Agent in trust for the Owners of such Bonds as provided herein;
(c) Bonds in exchange for or in lieu of which other Bonds have been registered and delivered pursuant to this Ordinance; and
(d) Bonds alleged to have been mutilated, destroyed, lost, or stolen which have been paid as provided in this Ordinance or by law.
“Owner” or “Owners” when used with respect to any Bond means the Person in whose name such Bond is registered in the Bond Register.
“Parity Obligations” means any pari passu obligations which may hereafter be issued pursuant to Section 13 hereof on a parity with the Bonds.
“Paying Agent” means CLB The Community Bank in the City of Jonesville, Louisiana, until a successor Paying Agent shall have become such pursuant to the applicable provisions of this Ordinance, and thereafter “Paying Agent” shall mean such successor Paying Agent.
“Person” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, or government or any agency or political subdivision thereof.
“Purchaser” means said CLB The Community Bank.
“Record Date” for the interest payable on any interest payment date means the 15th calendar day of the month next preceding such interest payment date.
“System” means the revenue producing waterworks plant and system owned and operated by the Issuer, as the System now exists and as it may be hereafter improved, extended or supplemented from any source whatsoever while any of the Bonds remain Outstanding, including, specifically, all properties and facilities of every nature owned and/or operated by the Issuer and used or useful in the operation of the System, including real estate, personal and intangible properties, contracts, franchises, leases and choses in action.
SECTION 2. Authorization of Bonds, Maturities. In compliance with and under the authority of the Act, this Governing Authority hereby authorizes the incurring of an indebtedness of Two Hundred Thousand Dollars ($200,000) for, on behalf of and in the name of the Issuer, to pay a portion of the costs of constructing and acquiring improvements, extensions, renovations and replacements to the waterworks system of the Issuer, including appurtenant equipment, fixtures and accessories, both personal and real, a work of public improvement for the Issuer, and paying the costs of issuance of the Bonds through the issuance of Two Hundred Thousand Dollars ($200,000) of Water Revenue Bonds, Series 2021, of the Issuer. The Bonds shall be issued in the form of a single, fully-registered Bond, numbered R-1, dated the date of delivery, shall bear interest at a rate of three and one-half percent (3.50%) per annum calculated on the basis of a 360-day year consisting of twelve 30-day months, on the outstanding principal thereof and be payable in annual principal installments as follows:
| Year (April 1) | Principal Maturing |
| 2022 | $17,000 |
| 2023 | 17,000 |
| 2024 | 18,000 |
| 2025 | 19,000 |
| 2026 | 19,000 |
| 2027 | 20,000 |
| 2028 | 21,000 |
| 2029 | 22,000 |
| 2030 | 23,000 |
| 2031* | 24,000 |
*Final Maturity
Interest on the outstanding principal is payable on each Interest Payment Date.
The principal installments of the Bond and the interest thereon shall be payable by check mailed by the Paying Agent to the Owner (determined as of the close of business on the Record Date) at the address shown on the Bond Register, except the final payment of principal shall be payable at the corporate office of the Paying Agent upon presentation and surrender of the Bond. Each Bond delivered under this Ordinance upon transfer of, in exchange for or in lieu of any other Bond shall carry all the rights to interest accrued and unpaid, and to accrue, which were carried by such other Bond, and each such Bond shall bear interest (as herein set forth) so that neither gain nor loss in interest shall result from such transfer, exchange or substitution.
No Bond shall be entitled to any right or benefit under this Ordinance, or be valid or obligatory for any purpose, unless there appears on such Bond a certificate of registration, substantially in the form provided in this Ordinance, executed by the Paying Agent by manual signature.
SECTION 3. Prepayment of Bond. The principal installments of the Bond are callable for prepayment by the Issuer in full or in part at any time and if in part, in the inverse order of the principal installments, at a price equal to the principal installments of the Bond to be prepaid, together with accrued interest to the date fixed for prepayment.
Official notice of such call of any principal installments of the Bond for prepayment shall be given by means of first-class mail, postage prepaid, by notice deposited in the United States mails, or via acceptable means of electronic communication, not less than fifteen (15) days prior to the prepayment date addressed to the Owner at his address as shown on the Bond Register.
SECTION 4. Registration and Transfer. The Issuer shall cause the Bond Register to be kept by the Paying Agent. The Bonds may be transferred, registered and assigned only on the Bond Register, which such registration shall be at the expense of the Issuer, and only by the execution of an assignment form on the Bonds being transferred. A new Bond or Bonds, may, upon request, be delivered by the Paying Agent to the last assignee (the new Owner) in exchange for such transferred and assigned Bond or Bonds after receipt of the Bond(s) to be transferred in proper form. Such new Bond or Bonds shall be in an authorized denomination of the same maturity and like principal. The Paying Agent shall not be required to issue, register the transfer of, or exchange any Bond during a period beginning at the opening of business on a Record Date and ending at the close of business on the Interest Payment Date.
SECTION 5. Form of Bonds. The Bond and the endorsements to appear thereon shall be in the form acceptable to the Executive Officers, upon advice of bond counsel, and the Purchaser.
SECTION 6. Execution of Bonds. The Bonds shall be signed by the Executive Officers for, on behalf of, in the name of and under the corporate seal of the Issuer, which signatures and corporate seal may be either manual or facsimile.
SECTION 7. Pledge of Revenues. Subject to the prior payment of the reasonable and necessary expenses of operating and maintaining the System, the Bonds shall be secured and payable in principal and interest exclusively by a pledge of the income and revenues derived or to be derived from the operation of the System. Said income and revenues shall be set aside in a separately identifiable fund or account as hereinafter provided and shall remain so pledged for the security and payment of the Bonds in principal and interest, and for all other payments provided in this Ordinance, until the Bonds shall be fully paid and discharged.
SECTION 8. Rate Covenant; Funds and Accounts. The Issuer, through its Governing Authority by proper ordinances and/or resolutions, hereby covenants to fix, establish, maintain and collect such rates, fees, rents or other charges for the services and facilities of the System, and all parts thereof, and to revise the same from time to time whenever necessary, as will always provide revenues in each year sufficient to pay the reasonable and necessary expenses of operating and maintaining the System in each year, the principal and interest falling due on the Bonds in each year, all sinking funds, contingency or other payments required for such year by this Ordinance, and all obligations or indebtedness payable out of the revenues during such year and which will provide such revenues in each year, after paying all reasonable and necessary expenses of operating and maintaining the System in such year, at least equal to the largest amount of principal and interest falling due on the Bonds and any Parity Obligations in any future Fiscal Year.
All of the income and revenues derived or to be derived by the Issuer from the operation of the System shall continue to be deposited as the same may be collected in a separate and special bank account heretofore established with the regularly designated fiscal agent bank of the Issuer designated as the “Water System Revenue Fund” (the “Revenue Fund”), the Revenue Fund having heretofore been created and to be maintained and administered in the following order of priority and for the following express purposes:
(a) The payment of all reasonable and necessary expenses of operating and maintaining the System.
(b) The establishment and maintenance of the “2021 Water Revenue Bond Sinking Fund” (the “Sinking Fund”) sufficient in amount to pay promptly and fully the principal of and the interest on the Bonds and any Parity Obligations issued hereafter in the manner provided by this Ordinance by transferring from the Revenue Fund to the regularly designated fiscal agent bank of the Issuer monthly in advance on or before the 20th day of each month of each year, a sum equal to the principal and interest accruing on the bonds payable from the Sinking Fund for such calendar month, together with such additional proportionate sum as may be required to pay said principal and interest as the same respectively become due. If Parity Obligations are hereafter issued, moneys in the Sinking Fund shall be equally available to pay principal and interest on such Parity Obligations, and payments into the Sinking Fund shall be increased as provided in the ordinance authorizing the issuance of such Parity Obligations. Said fiscal agent bank shall transfer from the Sinking Fund to any paying agent or pay directly to the registered owner, for all bonds payable from the Sinking Fund, at least one (1) day in advance of the date on which each payment of principal or interest falls due, funds fully sufficient to pay promptly the principal and/or interest so falling due on such date.
Subject to the foregoing, which are cumulative, the balance of the excess funds on deposit in the Revenue Fund may be used by the Issuer for the purpose of calling and/or paying bonds payable from the income and revenues of the System or for such other lawful corporate purposes as this Governing Authority may determine, whether or not such purposes are or are not related to the System.
All or any part of the moneys in the Revenue Fund shall, at the written request of the Issuer, be invested in direct obligations of the United States of America or other obligations permitted by Louisiana law, maturing in five (5) years or less, in which event all income derived from investments in the Sinking Fund shall be deposited in the Revenue Fund as income and revenues of the System. Such investments shall, to the extent at any time necessary, be liquidated and the proceeds thereof applied to the purposes for which said respective funds and accounts are herein maintained.
SECTION 9. Rates and Charges. The Issuer may alter, amend or repeal from time to time any resolutions or ordinances establishing a schedule of rates and charges for the services and facilities to be rendered by the System, said alterations, amendments or repeals to be conditioned upon the preservation of the rights of the owners of the Bonds with respect to the income and revenues of the System, not alone for the payment of the principal of and the interest on the Bonds, but to insure that the income and revenues of the System shall be sufficient at all times to fulfill the other provisions specified in Section 8 hereof. The Issuer shall fix and maintain rates and collect charges for all services and facilities to be rendered by the System, irrespective of the user thereof, and no free services or facilities shall be furnished to any person, association of persons, or corporations, public or private, or even to the Issuer itself, and no discrimination shall be made as to rates and charges for the services and facilities of the System as between users of the same type or class.
The Issuer further agrees that the failure of any individual, partnership or corporation to pay said charges for any service rendered by the System within thirty (30) days of the date on which it is due shall cause such charge to become delinquent; that if such delinquent charge, with interest and penalties accrued thereon, is not paid within thirty (30) days from the date on which it became delinquent, the Issuer will cause to be shut off service to the affected premises; and that the Issuer and this Governing Authority and its officials, agents and employees will do all things necessary and will take advantage of all remedies afforded by law to collect and enforce the prompt payment of all charges made for services rendered by the System. All delinquent charges for service shall on the date of delinquency have added thereto a penalty of ten percent (10%) of the amount of the charge, and the amount so due, including the penalty charge, shall, after thirty (30) days from the date of delinquency, bear interest at a reasonable rate to be established by this Governing Authority, which rate shall not be less than six per centum (6%) per annum. If services are discontinued as above provided, the customer shall, in addition to paying the delinquent charges, penalties and interest, pay as a condition precedent to the resumption of service a reasonable reconnection charge.
The schedule of water rates presently in effect shall remain in effect, and neither said schedule nor any subsequent schedule shall be reduced at any time unless all payments required for all funds by this Ordinance, including any deficiencies for prior payments, have been fully made, and unless such schedules as so reduced will in each year thereafter produce sufficient revenues to meet and fulfill the other provisions stated and specified in Section 8 of this Ordinance.
SECTION 10. Rights of Owners; Appointment of Receiver in Event of Default. The Owners shall be entitled to exercise all rights for which provision is made in the laws of the State of Louisiana. Any Owner or any trustee acting for such Owner in the manner hereinafter provided, may, either at law or in equity, by suit, action, mandamus or other proceeding in any court of competent jurisdiction, protect and enforce any and all rights under the laws of the State of Louisiana, or granted in this Ordinance, and may compel the performance of all duties required by this Ordinance or by any applicable statutes to be performed by the Issuer or by any agency, board or officer thereof, including the fixing, charging and collecting of rentals, fees or other charges for use of the System, and in general to take any action necessary to protect the rights of the Owner. In the event that default shall be made in the payment of the interest on or principal of any of the Bonds issued pursuant to this Ordinance as the same shall become due, or in the making of the payments into any fund established by Section 8 hereof or in the event that the Issuer or any agency, board, officer, agent or employee thereof shall fail or refuse to comply with the provisions of this Ordinance, or shall default in any covenant for a period of thirty (30) days after written notice thereof, any Owner or any trustee appointed to represent Owners as hereinafter provided, shall be entitled as of right to the appointment of a receiver of the System, in an appropriate judicial proceeding in a court of competent jurisdiction.
The receiver so appointed shall forthwith enter into and take possession of the System and shall hold, operate and maintain, manage and control the System, and in the name of the Issuer shall exercise all rights and powers of the Issuer with respect to the System. Such receiver shall collect and receive all fees, rentals and other revenues, maintain and operate the System in the manner provided in this Ordinance, and comply under the jurisdiction of the court appointing such receiver with all of the provisions of this Ordinance.
Whenever all that is due upon the Bonds and interest thereon, and under any covenants of this Ordinance for sinking or other funds, and upon any other obligations and interest thereon, having a charge, lien or encumbrance upon the fees, rentals or other revenues of the System, shall have been paid and made good, and all defaults under the provisions of this Ordinance shall have been cured and made good, possession of the System shall be surrendered to the Issuer upon the entry of an order of the court to that effect. Upon any subsequent default, any Owner, or any trustee appointed for Owners as hereinafter provided, shall have the same right to secure the further appointment of a receiver upon any such subsequent default. Such receiver shall in the performance of the powers hereinabove conferred upon him be under the direction and supervision of the court making such appointment, shall at all times be subject to the orders of such court and may be removed thereby and a successor appointed in the discretion of such court. Nothing herein contained shall limit the jurisdiction of such court to enter such other and further orders as such court may deem necessary for the exercise by the receiver of any function not specifically set forth herein.
Any receiver appointed as provided herein shall hold and operate the System in the name of the Issuer and for the joint protection and benefit of the Issuer and the Owners. Such receiver shall have no power to sell, assign, mortgage or otherwise dispose of any assets belonging or pertaining to the System but the authority of such receiver shall be limited to the possession, operation and maintenance of the System for the sole purpose of the protection of both the Issuer and the Owners, and the curing and making good of any default under the provisions of this Ordinance, and the title to the System shall remain in the Issuer, and no court shall have any jurisdiction to enter any order permitting or requiring such receiver to sell, mortgage or otherwise dispose of any assets of the System except with the consent of the Issuer and in such manner as the court shall direct. The Owners in an aggregate principal amount of not less than twenty-five percent (25%) of the principal amount of the Bonds then outstanding may by duly executed certificate in writing appoint a trustee for Owners with authority to represent such Owners in any legal proceedings for the enforcement of the rights of such owners. Such certificate shall be executed by such Owners, or by their duly authorized attorneys or representative, and shall be filed in the office of the Clerk of the Issuer.
Until an event of default shall have occurred, the Issuer shall retain full possession and control of the System with full right to manage, operate and use the same and every part thereof with the rights appertaining thereto, and to collect and receive and, subject to the provisions of this Ordinance, to take, use and enjoy and distribute the earnings, income, rent, issue and profits accruing on or derivable from the System.
SECTION 11. Covenants of Issuer. The Issuer does hereby covenant and warrant so long as any of the Bonds are outstanding and unpaid in principal and/or interest:
(a) That it is or will be lawfully seized and possessed of the System, that it has a legal right to pledge the income and revenues of the System as herein provided, and that the Bonds will have a lien and privilege on said income and revenues, subject only to the prior payment of all reasonable and necessary expenses of operating and maintaining the System.
(b) That it will at all times maintain the System in first class repair and working order and condition.
(c) That it will carry full insurance coverage on the System against those risks and in the amounts normally carried by privately owned public water companies. Said insurance policies shall be issued by a responsible insurance company or companies licensed to do business under the laws of Louisiana.
In case of loss, insurance money received by the Issuer shall be used to promptly repair or replace the property damaged.
(d) That it will maintain separate records and accounts and make full and correct entries of all transactions relating to the System. All books and accounts of the Issuer, including those pertaining to the System, shall be audited annually no later than six (6) months after the close of each fiscal year by a recognized independent firm of certified or registered public accountants, which audit shall reflect all receipts and disbursements of the Issuer, including those made for the account of the System. Such audit shall be furnished upon request to any Owner and to the fiscal agent bank of the Issuer.
(e) That it will not sell, lease or in any manner dispose of the System or any substantial part thereof, provided the Issuer may dispose of property which in its judgment is worn-out, unserviceable, unsuitable, or unnecessary in the operation of the System, when other property of equal value is substituted therefor, or the proceeds derived from the disposal of such property are used for constructing and acquiring extensions and improvements to the System or repairing the System.
(f) That except as provided in Section 12 hereof, it will not voluntarily create or cause to be created any debt, lien, pledge, mortgage, assignment, encumbrance, or any other charges having priority over or parity with the lien of the Bonds upon the income and revenues of the System pledged as security therefor.
(g) That, to the extent permitted by law, it will not grant a franchise to any utility for operations within the boundaries of the Issuer which would render services or facilities in competition with the System, and will oppose the granting of such franchise by any other public body having jurisdiction over such matters.
(h) That in operating the System it shall require all officers and employees in a position of authority or in possession of money derived from operation of the System to be covered by a blanket fidelity or faithful performance bond, or independent fidelity bonds, written by a responsible indemnity company in amounts adequate to protect the Issuer from loss.
SECTION 12. Deposit of Funds and Security Therefor. All of the income and revenues earned from the operation of the System shall be deposited promptly as provided in Section 8 hereof in the Revenue Fund, which shall be maintained with the regularly designated fiscal agent bank of the Issuer as provided herein, separate and apart from all other funds of the Issuer. The funds shall be and constitute trust funds for the purposes provided in this Ordinance, and the Owners are hereby granted a lien on all such funds and accounts until applied in the manner provided in this Ordinance. The moneys in all of such funds shall at all times be secured to the full extent thereof by the bank or trust company holding such funds by direct obligations of, or obligations the principal of and the interest on which are guaranteed by, the United States of America, or direct obligations of the State of Louisiana, having a market value of not less than the amount of moneys then on deposit in said funds and accounts, or other security authorized by Louisiana law.
SECTION 13. Issuance of Parity Obligations; Parity Requirements.The Bonds shall enjoy complete parity of lien on the net revenues of the System despite the fact that any of the Bonds may be delivered at an earlier date than any other of the Bonds. The Issuer shall issue no other bonds or obligations of any nature payable from or enjoying a lien on the revenues of the System having priority over or parity with the Bonds except that Parity Obligations may hereafter be issued on a parity with the Bonds under the following conditions, viz:
1. The Bonds or any part thereof, including interest thereon, may be prepaid, and the refunding bonds so issued shall enjoy complete equality of lien with the portion of the Bonds which is not prepaid, if there be any, and the refunding bonds shall continue to enjoy whatever priority of lien over subsequent issues may have been enjoyed by the Bonds prepaid; provided, however, that if only a portion of the Bonds outstanding is so refunded and the refunding bonds require total principal and interest payments during any year in excess of the principal and interest which would have been required in such year to pay the Bonds prepaid thereby, then such Bonds may not be prepaid without the consent of the Owners of the prepaid portion of the Bonds, unless the Issuer complies with the provisions as set forth in paragraph 2 hereof.
2. Parity Obligations may also be issued on a parity with the Bonds if all of the following conditions are met:
(a) The net revenues of the System for the fiscal year immediately preceding the year in which such Parity Obligations are to be issued, as such net revenues may be adjusted to reflect any increase in user rates which have been adopted and which will take effect prior to a date not later than twelve (12) months after the date of issuance of such Parity Obligations, are equal to at least 120% of the average annual debt service requirements on all bonds then outstanding, including any bonds or obligations whatsoever then outstanding which are payable from the revenues of the System, and Parity Obligations theretofore issued and then outstanding (but not including bonds which have been refunded or provision otherwise made for their full and complete payment and prepayment and the bonds so proposed to be issued.
(b) There must be no delinquencies in the payments required to be made into the various funds provided in Section 8 hereof.
(c) The existence of the facts required by paragraphs (a) and (b) above must be determined and certified to by the Clerk.
(d) The proceeds of the Parity Obligations must be used solely for the making of improvements, extensions, renewals, replacements or repairs to the System, or refunding prior bonds issued for such purposes.
3. Junior and subordinate bonds may be issued without restriction.
SECTION 14. Issuance of Bonds; Application of Proceeds. The Executive Officers are hereby empowered, authorized and directed to do any and all things necessary and incidental to carry out all of the provisions of this Ordinance, to cause the necessary Bonds to be printed, to issue, execute and seal the Bonds and to effect delivery thereof as hereinafter provided.
SECTION 15. Ordinance a Contract; Amendment. The provisions of this Ordinance shall constitute a contract between the Issuer and the Owners and the provisions of such contract shall be enforceable by appropriate proceedings to be taken by such Owners, either at law or in equity.
No material modification or amendment of this Ordinance, or of any ordinance amendatory hereof or supplemental hereto, may be made without the consent in writing of the Owners of two-thirds (2/3) of the aggregate principal amount of Bonds then outstanding; provided, however, that no such modification or amendment shall permit a change in the maturity of the Bonds or the redemption provisions thereof, or a reduction in the rate of interest thereon, or in the amount of the principal obligation thereof, or affecting the unconditional promise of the Issuer to pay the principal of and interest on the Bonds as the same shall become due from the income and revenues of the System, or reduce the percentage of Owners required to consent to any material modification or amendment of this Ordinance, without the consent of the Owner or Owners affected thereby.
SECTION 16. Retention and Duties of Consulting Engineer in Event of Failure to Make Required Payments. The Issuer covenants and agrees that in the event it should fail to derive sufficient income from the operation of the System to make the required monthly payments into the funds established by Section 8 hereof, it will retain a Consulting Engineer (the “Engineer”) on a continuous basis until all defaults are cured, for the purpose of providing for the Issuer continuous engineering counsel in the operation of its System. Such Engineer shall be retained under contract at such reasonable compensation as may be fixed by this Governing Authority, and the payment of such compensation shall be considered to be one of the costs of maintaining and operating the System. Any Engineer appointed under the provisions of this Section may be replaced at any time by another Engineer appointed or retained by the Issuer, with the consent and approval of the Purchaser.
SECTION 17. Award of Bonds. The Issuer hereby accepts the offer of the Purchaser for the Bonds, which offer is attached as Exhibit “A” hereto, and an Executive Officer is hereby authorized to execute said offer on behalf of the Issuer. As a condition to the delivery of the Bonds to the Purchaser, the Purchaser will execute a standard letter, acceptable to it and the Issuer, indicating it has conducted its own analysis with respect to the Bonds and is extending credit in the form of the Bonds as a vehicle for making a commercial loan to the Issuer.
SECTION 18. Recital of Regularity. This Governing Authority, having investigated the regularity of the proceedings had in connection with this issue of Bonds, and having determined the same to be regular, the Bonds shall contain the following recital, to-wit:
“It is certified that this Bond is authorized by and is issued in conformity with the requirements of the Constitution and statutes of the State of Louisiana.”
SECTION 19. Severability; Application of Subsequently Enacted Laws. In case any one or more of the provisions of this Ordinance or of the Bonds shall for any reason be held to be illegal or invalid, such illegality and invalidity shall not affect any other provisions of this Ordinance or of the Bonds, but this Ordinance and the Bonds shall be construed and enforced as if such illegal or invalid provisions had not been contained therein. Any constitutional or statutory provision hereafter enacted which validates or makes legal any provision of this Ordinance or the Bonds which would not otherwise be valid or legal, shall be deemed to apply to this Ordinance, to the Bonds.
SECTION 20. Arbitrage, Designation of Qualified Tax-Exempt Obligation. The Issuer covenants and agrees that, to the extent permitted by the laws of the State of Louisiana, it will comply with the requirements of the Internal Revenue Code of 1986 and any amendment thereto (the “Code”) in order to establish, maintain and preserve the exclusion from “gross income” of interest on the Bonds under the Code. The Issuer further covenants and agrees that it will not take any action, fail to take any action, or permit any action within its control to be taken, or permit at any time or times any of the proceeds of the Bonds or any other funds of the Issuer to be used directly or indirectly in any manner, the effect of which would be to cause the Bonds to be “arbitrage bonds” or would result in the inclusion of the interest on the Bonds in gross income under the Code, including, without limitation, (i) the failure to comply with the limitation on investment of Bond proceeds or (ii) the failure to pay any required rebate or arbitrage earnings to the United States of America or (iii) the use of the proceeds of the Bonds in a manner which would cause the Bonds to be “private activity bonds”.
The Bonds are designated as “qualified tax-exempt obligations” within the meaning of Section 265(b)(3) of the Code. In making this designation, the Issuer finds and determines that:
(a) the Bonds are not “private activity bonds” within the meaning of the Code; and
(b) the reasonably anticipated amount of qualified tax-exempt obligations which will be issued by the Issuer and all subordinate entities in calendar year 2021 will not exceed $10,000,000.
The Executive Officers are hereby empowered, authorized and directed to take any and all action to execute and deliver any instrument, document or certificate necessary to effectuate the purposes of this Section.
SECTION 21. Disclosure Under SEC Rule 15c2-12. The Issuer will not be required to comply with the continuing disclosure requirements described in Rule 15c2-12 of the Securities and Exchange Commission [17 CFR 240.15c2-12].
SECTION 22. Paying Agent; Appointment and Acceptance of Duties. The Issuer will at all times maintain a Paying Agent having the necessary qualifications for the performance of the duties described in this Ordinance. The designation of CLB The Community Bank as the initial Paying Agent is hereby confirmed and approved. The Governing Authority reserves the right to appoint a successor Paying Agent by (a) filing with the Person then performing such function a certified copy of an Ordinance giving notice of the termination of the agreement and appointing a successor and (b) causing notice to be given to each Owner. Furthermore, the Paying Agent may be removed by the Issuer at any time for any breach of its duties set forth herein, affective upon appointment of a successor Paying Agent as set forth above. Every Paying Agent appointed hereunder shall at all ties be a trust company or bank organized and doing business under the laws of the United States of America or of any State, authorized under such laws to exercise trust powers, and subject to supervision or examination by Federal or State authority.
SECTION 23. Publication; Peremption. This Ordinance shall be published one time in the official journal of the Issuer, or if there is none, in a newspaper having general circulation in the Issuer. It shall not be necessary to publish the exhibits to this Ordinance but such exhibits shall be made available for public inspection at the offices of the Governing Authority at reasonable times and such fact must be stated in the publication within the official journal.
SECTION 24. Effective Date. This Ordinance shall become effective immediately.
This ordinance having been submitted to a vote, the vote thereon was as follows:
YEAS: 2
NAYS: 0
ABSENT: 1
And the ordinance was declared adopted on this 8th day of March, 2021.
/s/ Patricia Hefner /s/ Michael Tubre___
Clerk Mayor
Exhibit A
Commitment Letter
February 26, 2021
Honorable Mayor and Board of Aldermen
Village of Harrisonburg, State of Louisiana
Re: $200,000 Water Revenue Bonds, Series 2021 of the Village of Harrisonburg, State of Louisiana
Please accept this letter as the commitment of the undersigned to purchase the captioned Bonds upon the terms and conditions outlined below:
(1) Issuer and Amount: $200,000 principal amount of Water Revenue Bonds, Series 2021 of the Village of Harrisonburg, State of Louisiana (the “Issuer”).
(2) Authority for Issue: La. R.S. 39:524 and the other applicable provisions of Part II of Chapter 4 of Subtitle II of Title 39 of the Louisiana Revised Statutes of 1950, as amended, and other constitutional and statutory authority
(3) Dated Date of Bonds: Date of delivery, which is anticipated to be April 8, 2021 (the “Closing Date”).
(4) Form of Bonds: The Bonds will be issued in the form of a single, fully-registered Bond numbered R-1 subject to annual principal installments, and shall be dated the date of delivery thereof.
(5) Interest Payment Dates: Each April 1 and October 1, commencing October 1, 2021, based on a 30/360 day year.
(6) Prepayment Provisions: The principal installments of the Bonds will be callable for prepayment at the option of the Issuer in full or in part at any time.
(7) Principal Payments and Interest Rate: The Bonds will bear interest at 3.5% (not to exceed 5%), and principal will be payable on April 1 of each year in the principal amounts as follows:
| Year (April 1) | Principal Maturing* |
| 2022 | $17,000 |
| 2023 | 17,000 |
| 2024 | 18,000 |
| 2025 | 19,000 |
| 2026 | 19,000 |
| 2027 | 20,000 |
| 2028 | 21,000 |
| 2029 | 22,000 |
| 2030 | 23,000 |
| 2031 | 24,000 |
*Subject to adjustment
(8) Security: The Bonds are secured by and payable in principal and interest solely from the income and revenues derived or to be derived by the Issuer from the operation of its waterworks system (the “System”), after paying the reasonable and necessary expenses of operating and maintaining the System.
(9) Parity Debt: Additional bonds may be issued pursuant to the provisions outlined in the bond ordinance expected to be adopted by the Issuer on March 8, 2021.
(10) Legal Opinion: The legal opinion of Foley & Judell, L.L.P., as to the due authorization, validity and federal and state tax-exemption of interest on the Bonds will be required.
(11) Bank Eligibility: The Bonds will be designated as “qualified tax-exempt obligations” under Section 265(b) of the Internal Revenue Code of 1986, as amended.
(12) Closing: All documents shall be delivered to the undersigned on or before the Closing Date.
(13) Investment Letter: The undersigned will execute an investment letter indicating that it has made a full investigation of the security for the issue and has not relied upon or requested that any disclosure document be prepared by or on behalf of the Issuer, and that it is purchasing the Bonds without any intention to sell any portion thereof to any person other than another financial institution.
(14) Paying Agent: CLB The Community Bank, of Jonesville, Louisiana. Fees will not be due to the Paying Agent for serving in this capacity. (If fees are to be due Paying Agent, schedule of fees is to be attached hereto and form a part of the proposal).
(15) Continuing Disclosure: It is understood that, with respect to the Bonds, the Issuer will not be required to comply with the continuing disclosure requirements of SEC Rule 15c2-12(b).
ACCEPTED BY THE
VILLAGE OF HARRISONBURG,
STATE OF LOUISIANA
ON MARCH 8, 2021.
By: Michael Tubre
Mayor
cc: Brennan K. Black, Foley & Judell, L.L.P., Bond Counsel
STATE OF LOUISIANA
PARISH OF CATAHOULA
I, the undersigned Clerk of the Village of Harrisonburg, State of Louisiana (the “Village”), do hereby certify that the foregoing pages constitute a true and correct copy of an Ordinance adopted by the Mayor and Board of Aldermen of the Village of Harrisonburg, State of Louisiana, acting as the governing authority of the Village on March 8, 2021, authorizing the issuance of Two Hundred Thousand Dollars ($200,000) of Water Revenue Bonds, Series 2021, of the Village of Harrisonburg, State of Louisiana; prescribing the form, fixing the details and providing for the payment thereof; providing for the sale thereof and entering into certain other covenants and agreements in connection with the security and payment of said Bonds; and providing for other matters in connection therewith.
IN FAITH WHEREOF, witness my official signature on this, the 8th day of March, 2021.
Patricia Hefner
Patricia Hefner, Town Clerk
