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HomeMy WebLinkAboutReso 2008-144 - MSR Energy Authority . . ~~ RESOLUTION NO. 2008 - 144 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDDING APPROVING THE ISSUANCE BY THE NEWLY FORMED M-S-RENERGY AUTHORITY OF NOT TO EXCEED $1,800,000,000 AGGREGATE PRINCIPAL AMOUNT OFM-S-R ENERGY AUTHORITY GAS REVENUE BONDS SERIES 2008 IN ONE OR MORE SERIES; APPROVING THE FORM OF AND AUTHORIZING EXECUTION AND DELIVERY OF A SUPPLY AGREEMENT WITH M-S-R ENERGY AUTHORITY AND CERTAIN PORTIONS OF AN OFFICIAL STATEMENT; AND AUTHORIZING RELATED ACTIONS AND MATTERS WHEREAS, Article 1 of Chapter 5 of Division 7 of Title 1 ofthe Government Code of the State of California authorizes and empowers local agencies to form a joint powers authority, and Article 4 of Chapter 5 of Division 7 of Title I of the Government Code of the State of California authorizes and empowers such an authority to issue bonds for the purpose of financing public capital improvements, working capital, liability and other insurance needs, or projects whenever there are significant public benefits, as determined by the local agency; WHEREAS, the City of Redding (the "City") the City of Santa Clara and the Modesto Irrigation District (the "District" and, together with the City and the City of Santa Clara, the "Participants") have created and established, pursuant to the laws ofthe State of California, the M-S- R Energy Authority (the "Authority") for the purpose of, among other things, entering into contracts and issuing bonds to assist the Participants in financing the acquisition of supplies of natural gas for use by the Participants in connection with each PartIcipant's respective electric utility in accordance with the form of a Joint Exercise of Powers Agreement (the "JPA Agreement") among the Participants as hereinafter described; WHEREAS, the Authority is planning to purchase certain quantities of natural gas from Citigroup Energy Inc. on a prepaid basis and to sell such natural gas to the City, as contemplated herein and in the Supply Agreement described herein (the "Gas Project"); ~ 0\1 ~ '" --c: . . WHEREAS, the Authority is planning to finance a portion of the costs of the Gas Project with the proceeds of a portion of one or more series of M-S-R Energy Authority Gas Revenue Bonds, Series 2008 (the "Bonds"); WHEREAS, the City has determined that the creation of the Authority and the issuance of the Bonds by the Authority is desirable and furthers the public purposes of the City and that there are significant public benefits to be derived from securing the assistance ofthe Authority in financing the Gas Project, in that the City will benefit from demonstrable savings in the cost of financing the Gas Project; WHEREAS, in order to achieve such public purpose, and in accordance with the JP A Agreement, the City desires to approve the Authority's issuance of not to exceed $1,800,000,000 aggregate principal amount of the Bonds (with Redding's share not-to-exceed $600,000,000); WHEREAS, there has been presented to this meeting a proposed form of a natural gas supply agreement (the "Supply Agreement") between the Authority and the City, pursuant to which the City will purchase natural gas from the Authority, as more completely described therein; WHEREAS, there has been presented to this meeting a proposed form of Preliminary Official Statement describing the Bonds, the financing of the Gas Project and other information, including a description of the City's electric system (the "Preliminary Official Statement"); and WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the authorization of the execution and delivery of the Supply Agreement, the approval of the Bonds and that portion of the Preliminary Official Statement describing the City's electric system do exist, have happened and have been performed in regular and due time, form and manner as required by law, and upon the adoption of this resolution the City will be duly authorized to execute and deliver the Supply Agreement, to approve the Bonds and to approve that portion of the Preliminary Official Statement and the final Official Statement describing the City's electric system; . . NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Redding as follows: Based upon the terms and conditions of the various documents authorized herein and consultation with its financial advisors, attorneys, underwriter and staff of the City, and the recitals in this resolution (the "Resolution"), the City hereby finds and determines that all of the preambles in this Resolution are true and correct. Capitalized terms not otherwise defined in this Resolution shall have the meanings set forth in the Supply Agreement. a. The City hereby approves the issuance of the Bonds by the Authority in an aggregate principal amount not to exceed $1 ,800,000,000 and in one or more series as may be determined by the Authority. Section 3. The Supply Agreement, in substantially the form on file with the City Clerk and incorporated by reference as if fully set forth herein, is hereby approved. Any Authorized City Representative is hereby authorized to execute, and the City Clerk is hereby authorized to attest, seal and deliver, the Supply Agreement in substantially said form with such changes therein as shall be approved by the City Attorney and such Authorized City Representative executing the same, with such execution to constitute conclusive evidence of such Authorized City Representative's approval and the City's approval of any changes or revisions therein from the form of the Supply Agreement now on file with the City Clerk. Section 4. The approval of the Bonds and the authorization ofthe execution and delivery ofthe Supply Agreement is subject to the following conditions precedent: 1. The Scheduled Termination Date under the Supply Agreement shall not be later than December 31, 2039; ii. The total volume of Contract Gas to be delivered in each year under the Supply Agreement shall not be greater than 7,000 MMBtu per day through December 31, 20 I 0, and shall not be greater than 8,500 MMBtu per day thereafter; and . . . iii. The Contract Price with respect to a Delivery Month shall not exceed an amount per MMBtu of Gas equal to the Index Price for such Delivery Month less $0.75 per MMBtu. Section 5. The portion of the Preliminary Official Statement relating to the Bonds describing the City of Redding Electric Utility, in substantially the form distributed to the City Council and on file with the City Clerk and incorporated by reference as if fully set forth herein, is I hereby approved with such changes therein as an Authorized City Representative may require or approve. Any Authorized City Representative is hereby authorized to certif'ythat such portion of the Preliminary Official Statement is "deemed final" by the City for purposes of Rule l5c2-l2 of the Securities Exchange Commission. Following sale of the Bonds, an Authorized City Representative is authorized and directed to prepare or cause to be prepared a form of final Official Statement that shall include information concerning the sale of the Bonds and such other information as may be necessary, customary or appropriate, and the portion of such final Official Statement describing the City of Redding Electric Utility, with such changes therein (if any) as an Authorized City Representative may require or approve, shall be approved by such Authorized City Representative. Section 6. The officers, employees and agents of the City are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents, certificates and other instruments which they may deem necessary or advisable (including, without limitation, a continuing disclosure agreement, a tax certificate and agreements relating to municipal bond insurance) in order to consummate the execution and delivery of the financing and refinancing of the Gas Project, the execution and delivery of the Supply Agreement and the issuance of the Bonds by the Authority, all as authorized herein, and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution and the documents herein approved and authorized to be executed. Section 7. This Resolution shall take effect immediately upon its adoption. . . . . I HEREBY CERTIFY that the foregoing Resolution was introduced and read an<II;adopted at a regular meeting of the City Council of the City of Redding on the 5th day of August, 2008, by the following vote: AYES: NOES: ABSENT: ABSTAIN: COUNCIL MEMBERS: COUNCIL MEMBERS: COUNCIL MEMBERS: COUNCIL MEMBERS: Bosetti, Dickerson, Jones, Murray, and Stegall None None None ~lhn~ MAR LEA STEGALL, Ma r Attest: c' i :- Approved as to Form: -:-;, I , . r- . .,,' . .~ . Iil/~\. ( ->. " 'l....P ,,~~ <;\ k~, CONNIE S:ROHM~.Y~~.Mty Clerk ~ . ~ (' -" \.. ~ " p" '\ ,. '1>-V\ .'