HomeMy WebLinkAboutOrdinances - O-55-16.1 - 03/19/1955 - ISSUE $179 000 WATER SEWER BONDSORDINANCE No. 0155-16.1
AN ORDINANCE creating an issue of
$179,000 Waterworks and Sewerage
Revenue Bonds, Series of 1956, of
the City of McHenry, McHenry County,
Illinois, and providing for the pay-
ment and delivery thereof.
WHEREAS, the City of McHenry, McHenry County, Illinois,
has for many years long past owned and operated in its governmental
capacity a waterworks system and a sanitary sewerage system serving
the needs of said City and has combined said systems into a combined
waterworks and sewerage system (said combined waterworks and sewerage
system hereinafter, together with improvements, extensions and re-
pairs authorized by this ordinance, and all further improvements and
extensions thereof, or replacements thereto, herein called the "system")
and
WHEREAS, the governing body of said City has heretofore
approved all plans, maps, files and specifications for the construction
of needed improvements, extensions and repairs to said system to ef-
ficiently collect and dispose of the domestic and industrial wastes
and their products within said City in the best interests of the public
health and sanitation of said City, and has determined that said City
will need to borrow $179,000 to pay, with other funds to be made avail-
able therefor, said improvements, extensions and repairs, and the in-
come and revenue to be derived from the operation of said system is
determined adequate to provide for the payment of said bonds so pro-
posed to be issued in the principal amount of $179,000, as aforesaid.
NOW, THEREFORE, Be It Ordained by the City Council of the
City of McHenry, McHenry County, Illinois, as follows:
Section 1. That the existing combined waterworks and
sewerage system of this City shall be improved, extended and repaired
in accordance with the engineering report heretofore submitted to and
approved by this Council by W. A. Rakow & Associates, Consulting
Municipal Engineers, Elgin, Illinois, and Robert H. Anderson, Consult-
ing Engineer, St. Charles, Illinois, and also in accordance with the
construction contract let therefor with the Tonyan Construction Co.,
Inc., under date of February 6, 1956, by the acquisition, construction
and installation of the following described properties, improvements
and equipment, together with all necessary appurtenances and connections
used or useful in connection with the public convenience thereof, viz:
(a) Construction of a new pump station to be pro-
vided with three (3) pumping units,
(b) Construction of primary settling tanks with
inlets and outlets arranged for separate use,
(c) Construction of two (2) aeration tanks with
inlets and outlets so arranged for separate use,
(d) Construction of two (2) new final settling
tanks adjacent to the new aeration tanks with inlets and
outlets so arranged for separate use,
(e) Construction of a new sludge dewatering unit
operating on a vacuum filter basis,
(f) The conversion of the existing primary tank
to sludge well, the conversion of existing aeration tank to
primary settling tanks, and the conversion of existing final
tank to blower house,
(g) All easements, properties, work equipment and
appurtenances needful to the construction and conversion of
these improvements and to the integration thereof with the
existing waterworks and sewerage system of said City for the
proper and efficient operation thereof to meet the require-
ments of the Sanitary Water Board of the State of Illinois,
all as more fully set forth in itemized detail in said plans, files,
maps and specifications, and construction contract hereinabove referred
to and now on file for public inspection in the office of the City
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Clerk, and the period of usefulness of said combined waterworks and
sewerage system, including said described improvements, extensions and
repairs, is hereby determined by this City Council to be forty (40)
years from the date of the bonds herein authorized to be issued.
Section 2. That for the purpose of accomplishing the
needful improvements, extensions and repairs to said system as herein -
above described, there be issued and sold the bonds of said City to be
designated Waterworks and Sewerage Revenue Bonds, Series of 1956, in
the principal sum of $179,000, the proceeds from the sale thereof
aggregating $171,000, together with the sum of $160,000 to be made
available by said City from the proceeds of an issue of $160,000 Sewer
Improvement Bonds voted at a special election held on June 21, 1955,
being hereby determined adequate to pay the cost estimate of construct-
ing said improvements, extensions and repairs as hereinabove described
(including one (1) year's interest on said bonds during the period of
said construction) in the aggregate sum of $331,000. The said bonds
shall bear date of May 1, 1956, be of $1,000 denomination each, numbered
from 1 through, 179, and shall mature serially in numerical order on
May 1 in each of the years and in amounts as follows:
$2,000 -
1958
through
1960
3,000 -
1961
through
1963
4,000 -
1964
through
1966
5,000 -
1967
through
1970
6,000 -
1971
through
1974
7,000 -
1975
through
1978
$,000 -
19?9
through
1982
9,000 -
19 3
and 1984
10,000 -
1985
through
1987
provided that the City of McHenry reserves the right to call for
redemption prior to maturity, on May 1, 1971, or on any interest pay-
ment date thereafter, at par and unpaid accruedjnterest to the date
of redemption, the bonds maturing on May 1 in each of the years 1972
through 1987, in the inverse numerical order of said bonds, in ac-
cordance with the terms and conditions as set forth in Section 3 of
this ordinance.
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The said bonds shall bear interest at the rate of Four
Per Cent (4%) per annum, to be payable on November 1, 1956, and semi-
annually thereafter on May 1 and November 1 in each year until paid,
and both the principal and interest on the said bonds shall be pay-
able in lawful money of the United States of America at the American
National Bank and Trust Company of Chicago, Chicago, Illinois.
Said bonds shall be signed by the Mayor, sealed with the
corporate seal of said City, and attested by the City Clerk, and the
interest coupons attached to said bonds shall be executed by the
facsimile signatures of said Mayor and said City Clerk, and said of-
ficials, by th.e,execution of said bonds, shall adopt as and for their
own proper signatures their respective facsimile signatures appearing
on said coupons.
Said bonds, together with interest thereon, shall be
payable solely from the revenues derived from the waterworks and
sewerage system of said City, and such bonds shall not in any event
constitute an indebtedness of said City within the meaning of any
constitutional provision or any constitutional or statutory limitation.
Any of said bonds may be registered at the option of the
holder as to principal only, at any time prior to maturity, in the
name of the holder, on the books of said City in the office of the
City Treasurer, such registration to be noted on the reverse side of
the bonds by the City Treasurer, and thereafter the principal of such
registered bonds shall be payable only to the registered holder, his
legal representatives or assigns. Such registered bonds may be
transferred to another registered holder or back to bearer only upon
presentation to the City Treasurer, with a legal assignment duly ac-
kowledged or approved. Registration of any of such bonds shall not
affect the negotiability of the coupons thereto attached, and such
coupons shall be transferable by delivery merely.
Section 3. That said bonds and coupons attached thereto
shall be in substantially the following form:
(Form of Bond)
UNITED STATES OF AMERICA
STATE OF ILLINOIS COUNTY OF MC HENRY
CITY OF MC HENRY
WATERWORKS AND SEWERAGE REVENUE BOND, SERIES OF 1956
Number $1,000
KNOW ALL MEN BY THESE PRESENTS,that the City of McHenry,
in the County of McHenry and State of Illinois, for value received
hereby promises to pay to bearer, or if this bond be registered as
hereinafter provided, then to the registered holder hereof, solely
from the Waterworks and Sewerage Fund of the City of McHenry, as
hereinafter mentioned and not otherwise, the sum of One Thousand
Dollars ($1,000) on May 1, 19 , (unless this bond is then subject
to prior redemption and has been called for payment and funds provided
for the payment thereof as hereinafter stated) and to pay interest on
such principal sum from the date hereof until paid, at the rate of
Four Per Cent (4%) per annum, payable November 1, 1956, and semi-
annually thereafter on the first days of May and November in each
year, and until maturity hereof upon presentation and surrender of
the interest coupons hereto appertaining as they severally mature.
Both principal of and interest on this bond are hereby
made payable in lawful money of the United States of America at the
American National Bank and Trust Company of Chicago, Chicago, Illinois.
This bond is payable solely from revenues derived from
the waterworks and sewerage system of said City and not otherwise, and
is issued under authority of the Revised Cities and Villages Act, and
all laws amendatory thereof and supplementary thereto, for the purpose
of paying part of the cost, with other funds to be made available
therefor, of necessary improvements, extensions and repairs to the
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waterworks and sewerage system of said City, and this bond does not
constitute an indebtedness of said City within the meaning of any
constitutional provision or any constitutional or statutory limita-
tion.
Under said Act and the ordinance adopted pursuant there-
., -,,,to, the entire revenue derived and to be derived from the operation
of the waterworks and sewerage system of this City shall be deposited
in a separate fund designated as the "Waterworks and Sewerage Fund
of the City of McHenry," which shall be used only for the purpose of
paying the cost of operating and maintaining such system, providing
an adequate depreciation fund, and paying the principal of and inter-
est on the bonds of said City that are issued under authority of said
Act and are payable by their terms only from the revenue of such
system, and creating and maintaining the several accounts established
by the ordinance authorizing the issue of bonds of which this bond is
one.
Said City reserves the right to redeem prior to maturity,
on May 1, 1971, or on any interest payment date thereafter, at par
and unpaid accrued interest to the date of redemption, the bonds
maturing on May 1 in each of the years 1972 through 1987, in the
inverse numerical order of said bonds.
Notice of such redemption shall be given by registered
mail to the registered holder, if known, at the address shown on the
books of the Registrar, and as to unknown holders, such notice shall
be published once a week for at least two (2) consecutive weeks in a
newspaper published in the City of Chicago, Illinois, and devoted in
part to the publication of financial news, and shall be filed at the
place of payment of said bonds. The mailing, the filing, and the
date of the first publication of said redemption notice shall be at
least thirty (30) days prior to the date specified for redemption, and
said redemption notice shall describe the bonds to be redeemed, the
date of redemption, and the place of redemption, which shall be the
paying agent as stated in said bonds. After notice of redemption
has been given in accordance herewith and funds are on deposit with
the paying agent to pay the said bonds so to be redeemed, interest
thereon shall cease from and after the date of redemption.
It is hereby certified and recited that all acts, condi-
tions and things required by the Constitution and statutes of the
State of Illinois to be done precedent to and in the issuance of this
bond and in raising funds to promptly assure payment thereof, have
been done and have happened and have been performed in regular and
due form of law; that provision has been made for depositing in said
Waterworks and Sewerage Fund the entire revenues received from the
operation of said system, to be applied in the manner as hereinabove
set forth; and it is hereby covenanted and agreed that rates will be
charged for the use and service of such system sufficient at all times
to create and maintain the several Accounts established by the ordi-
nance authorizing the issue of bonds of which this bond is one.
This bond may be registered as to principal in the name
of the holder,, on the books of said City in the office of the City
Treasurer, such registration to be evidenced by notation of said
Treasurer on the back hereof, and after which no transfer hereof
shall be valid unless made on said books and similarly noted hereon,
but it may be discharged from such registration by being transferred
to bearer, after which it shall be transferable by delivery, but it
may be again registered as before. The registration of this bond
shall not restrict the negotiability of the coupons by delivery merely.
IN WITNESS WHEREOF, said City of McHenry, McHenry County,
Illinois, by its City Council, has caused this bond to be signed by
its Mayor, its corporate seal to be hereto affixed and attested by
the City Clerk, and the coupons hereto attached to be signed by the
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facsimile signatures of said Mayor and said City Clerk, which of-
ficials, by the execution of this bond, do adopt as and for their
own proper signatures their respective facsimile signatures appearing
on said coupons, and this bond to be dated as of the first day of
May 1, 1956.
Attest:
City Clerk
Number
Mayor
(Form of Coupon)
On the first day of
, 19 , the City of
McHenry, McHenry County, Illinois, will pay to bearer out of the
Waterworks and Sewerage Fund of said City (unless the bond to which
this coupon is attached has been called for redemption as therein
provided) Dollars ($ ) in lawful
money of the United States of America, at the American National Bank
and Trust Company of Chicago, Chicago, Illinois, being interest then
due on its Waterworks and Sewerage Revenue Bond, Series of 1956,
dated May 1, 1956, numbered
(facsimile signature)
Mayor
facsimile signature)
City Clerk
(Form of Registration Certificate)
Date of Signature of
Registration In Whose Name Registered City Treasurer
In
Section 4. That upon the issuance of any of the
Waterworks and. Sewerage Revenue Bonds herein provided for, the entire
waterworks and. sewerage system of said City, for the purpose of this
ordinance, shall be operated on a fiscal year basis, commencing the
first day of May and ending the last day of April of each succeeding
year, beginning as of May 1, 1956, and during each year ending April
30, so long as any of the bonds herein authorized to be issued are
outstanding, the entire revenues derived from the operation of said
system of said. City shall be collected and shall be set aside as col-
lected, and shall be deposited in accordance with thelaws of the State
of Illinois governing the deposit of public moneys, in a separate
fund, which is hereby created, to be designated as the "Waterworks and
Sewerage Fund of the City of McHenry," which shall be kept apart and
segregated from all other moneys of said City and shall be used only
to create and maintain the several accounts hereinafter specified
for the purpose of paying the cost of the operation and maintenance
of said system, providing an adequate depreciation reserve, and paying
the principal of and interest upon the Waterworks and Sewerage Revenue
Bonds issued under the terms of this ordinance, and such Waterworks
and Sewerage Fund shall be used only for such purposes and is hereby
pledged therefor.
Section 5. For the accounting of all moneys and assets
of said Waterworks and Sewerage Fund at any time and from time to time
while any Waterworks and Sewerage Revenue Bonds herein authorized are
outstanding and unpaid, there is hereby created and established five
separate Account to be designated (a) the Operation and Maintenance
Account, (b) the Depreciation Account, (c) the Bond Account, (d) the
Bond Reserve Account, (e) the Surplus Account, and all deposits made
to and all funds held in each of said Accounts, respectively, shall
be continuously secured as provided by the laws of the State of Illinois
governing the deposit of public moneys and into which there shall be
paid on the first business day of each month all moneys held in said
Waterworks and Sewerage Fund in accordance with the following provi-
sions and in the priority of said Accounts so created and established
as follows:
(a) Operation and Maintenance Account: There first
shall be set apart and paid out of said Waterworks and Sewerage Fund
into an Operation and Maintenance Account an amount considered neces-
sary and sufficient to pay the reasonable current expenses of operat-
ing, repairing; and maintaining said system for the current month.
(b) Depreciation Account: There next shall be de-
posited in the Depreciation Account a sum sufficient to aggregate
$2,400 each year until a maximum sum of $4,800 is on deposit in said
Account, which is hereby found and determined to be a reasonable
amount necessary to accomplish the purpose for which said Depreciation
Account is established, and at which figure said Account, notwith-
standing any transfer therefrom as herein permitted, shall thereafter
be continuously maintained. The moneys in said Account shall be used
to pay the cost of necessary replacements to the system, and shall
not be used for extensions to said system, except that the funds held
in said Depreciation Account to the extent necessary to prevent or
remedy a default in the payment of the interest on or principal of
the bonds herein authorized shall be used and held for use for that
purpose, and shall be transferred to the Bond Account, and whenever
such a transfer is made, the amount so transferred shall be added to
the next deposit to be made, and thereafter until full reimbursement
to said Depreciation Account has been made.
The moneys in said Depreciation Account may be invested
and reinvested in bonds or other obligations of the United States
Government maturing within five (5) years from the date of purchase
as may be authorized from time to time by resolution of the Mayor and
City Council of said City.
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(c) Bond Account: There next shall be deposited in
the Bond Account, whibh shall be maintained at the American National
Bank and Trust Company of Chicago, Chicago, Illinois, for the purpose
of paying the maturing principal of and the interest accruing on the
Waterworks and Sewerage Revenue Bonds issued under the terms of this
ordinance, an amount at least equal to one -sixth (1/6th) of the inter-
est becoming due on all outstanding Waterworks and Sewerage Revenue
Bonds on the next succeeding interest payment date, and beginning
with the fiscal year commencing May 1, 1957, and for each fiscal year
thereafter, an amount equal -co one -twelfth (1/12ch) of the principal
becoming due on the next succeeding principal payment date, such equal
monthly installments to produce not less than the following minimum
amounts in each fiscal year:
Fiscal Year Ending
April 30
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
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Principal
and Interest
$7,16o.00
9,16o,00
90080.00
9,000.00
9,920.00
9,800.00
9, 68o . oo'
10,560.00
10, 00.00
10,24o.00
11,080.00
10,880.00
lo, 68o . od
10,480.o0
11,280.00
11,040.00
10,80o,oa
10,56o.00
11, 320.00
11,04o.0o
10,76o.o0
1o,480.00
11,200.00
10,880.00,
10,560.00
10,240.00
10,920.00
10,56o.00.
11,200.00
10,800.00.
10,400.00.
(d) Bond Reserve Account: There shall next be de-
posited in the Bond Reserve Account a sum sufficient to aggregate
$1,000 each year until a maximum of $12,000 is on deposit in said
Account, and at which figure said Account, notwithstanding any trans-
fer therefromas herein permitted, shall thereafter be continuously
maintained, and all moneys therein shall be only used by the Treasurer
hereof as may be needed from time to time in the payment of the inter-
est on or principal of the bonds herein authorized whenever there
exists a deficiency in the Bond Account hereinabove established, and
all withdrawals therefrom for'that purpose shall be reimbursed from
the next revenues available therefor as provided therein.
The moneys in said Bond Reserve Account shall be de-
posited with 'the American National Bank and Trust Company of Chicago,
Chicago, Illinois, and may be invested and reinvested in bonds or
other obligations of the United States Government maturing within five
(5) years from date of purchase as may be authorized from time to
time by resolution of the Mayor and City Council of said City.
(e) Surplus Account: Any surplus funds remaining at
the end of any fiscal year after providing for all of the deposits
hereinabove listed in subparagraphs (a) through (d), and after the
reimbursement of any account that is depleted by withdrawals, shall
be deposited in the Surplus Account. The moneys in said Surplus
Account shall be used or held for use exclusively (a) for the purpose
of making improvements and extensions to the system, or (b) for the
prior redemption of the bonds herein authorized prior to their maturity
in accordance with all the terms, provisions and conditions to ac-
complish such prior redemption, and any bonds so redeemed shall be
cancelled, or (c) for any lawful purpose.
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:Section 6. That the City of McHenry hereby agrees to
carry insurance on said system of the kinds and in the amounts which
are usualy carried by private parties operating similar properties,
including without limiting the'generdlity of the foregoing, fire,
windstorm insurance, public liability, and any additional insurance
covering such ;risks as shall be recommended by a competent independent
engineer employed for the purpose of making such recommendations, and
all moneys received for losses under suchjnsurance policies as insure
against physical damage to or loss of the system shall be deposited in
the Depreciation Account and shall be used in making good the loss or
damage in respect of which they were paid, either by repairing the
property damaged or replacing the property destroyed, and provision
for making good such loss or damage shall be made within ninety (90)
days from the date of the loss. The proceeds of any and all policies
for public liability shall be paid into the Operation and Maintenance
Account and used in paying the claims on account of which they were
received.
'The payment of premiums for all insurance policies re-
quired under the provisions of this section shall be considered an
operation and maintenance expense.
Section 7. That while any of the Waterworks and Sewer-
age Revenue Bonds issued pursuant to this ordinance remain outstanding
or unpaid, rates charged for water and sewerage services shall be suf-
ficient at all times to pay all costs of operation and maintenance of
the system, to make the payments and maintain the balance as required
in the Depreciation Account, to pay the principal of and interest on
all bonds authorized hereunder, and to make the payments and maintain
the balance as required in the Bond Reserve Account, as is hereinabove
provided for. There shall be charged against all users of the system,
including the City of NIeHenry, such rates and amounts for water and
sewerage services as shall be adequate to meet the requirements of this
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section. Charges for services rendered the City shall be made against
the said City., and payment for the same from the corporate funds shall
be made monthly into the Waterworks and Sewerage Fund created by this
ordinance as other revenues derived from the operation of the system
and in the same manner as other revenues are so required to be
deposited.
In addition to the foregoing said City covenants not to
provide any free service of said system and to pay promptly for the
use of all facilities connected, and to be connected, with said system.
It is expressly herein covenanted that said City will
not grant a franchise for the operation of any competing waterworks
system or sewer system within the City of McHenry, and that the bonds
herein authorized to be executed shall constitute legally enforceable
liens upon the earnings of the combined waterworks and sewerage system
of said City, including all further extensions, additions, and improve-
ments thereto, whether acquired through purchase, contract, or other-
wise.
Section 8. In the event said City defaults in complying
with any covenant contained in this ordinance, any holder of any bond
issued hereunder, or of any coupon representing interest accrued there-
on, may apply for the appointment of a receiver, or may, either in law
or in equity, by proper suit, compel the officials of said City to
perform all duties required by law and by this ordinance, including
the making and collecting of sufficient rates for water and sewerage
services for that purpose and the application and segregation of all
income and revenue therefrom in accordance with the requirements of
this ordinance.
Section �. That it is hereby covenanted and agreed
with the holders of the bonds herein authorized that said City will
not issue any other or additional bonds or other evidences of obliga-
tions of said. City payable from or in any way creating a charge upon
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the income and revenue to be derived from the operation of said
system, except as herein provided:
(A) Said City reserves the right to issue additional
bonds to assure the completion of the construction of improvements,
extensions and repairs to said system as hereinabove described and
in accordance with the aforementioned plans and specifications adopted
therefor in an amount found and determined necessary as determined by
ordinance adopted by the governing body of said City, provided that
before any such ordinance shall be adopted there shall be filed with
the governing body of said City a requisition of the engineer in
responsible charge of constructing said improvements, extensions and
repairs,
(i) certifying to the amount of additional money needed
and in detail the respective purposes for which such additional
money is to be disbursed and the amount to be disbursed for
each purpose;
(ii) if the pertinent requisition of such engineer
shalldescribe any lands or rights therein certifying that the
lands or rights therein so described are necessary to complete
the construction of such improvements, extensions and repairs
and specifying the particular purposes for which the same are
to be used;
(iii) if any of the additional money requested is to be
disbursed in payment for property furnished or constructed other
than real estate and rights therein certifying that such pro-
perty has been furnished or constructed in compliance with the
plans and specifications as aforesaid; and
(iv) certifying that the amount of such additional
money will be sufficient to complete the construction of such
improvements, extensions and repairs in accordance with the
said plans and specifications therefor and all lawful permits
required by law.
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(B) Said City reserves the right to issue additional
bonds for constructing further necessary improvements, extensions,
repairs and rehabilitations to the properties comprising said system
as shall be determined necessary for the continued and efficient
operation of said system by a certificate filed of an independent
engineer in responsible charge of such further improvements, extensions,
repairs and rehabilitations,
(i) giving a reasonably detailed description of such
work, an estimate of the cost thereof, and an estimate of the
time of completion thereof; and
(ii) showing the feasibility of such revenue financing
with reference to then existing rates and anticipated earnings
based thereon, which certificate shall be approved by and shall
be made of public record in the proceedings of the governing
body of said City before any such additional bonds are authorized
provided, however, that no such additional bonds for such purpose or
purposes shall. be issued unless and until the gross cash operating
revenues of said system earned for the last fiscal year ending April
30 immediately preceding the authorization of any such additional
bonds, as shown by an audit of an independent certified public ac-
countant, were: sufficient to pay all costs of the operation and main-
tenance of said system, to make the annual payments to the Deprecia-
tion Account and to the Bond Reserve Account, respectively, as herein -
above required, and to make up any and all deficiencies then existing
as hereinabove specified in Section 5 of this ordinance, and leave a
balance equal to one and one -tenth 11 1/10) times the maximum amount
of interest and principal that will become due in any fiscal year sub-
sequent to the issuance of such additional bonds on the bonds of this
issue then outstanding (including said additional parity bonds to com-
plete the improvements, extensions and repairs as specified in para-
graph A of this Section) and on the additional bonds then proposed to
be issued.
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Said City further covenants that if any additional
bonds are so issued as permitted by this paragraph, the maximum amounts
to be deposited in the Bond Reserve Account and the Depreciation Ac-
count shall be increased in the proportion to the principal amount of
any additional bonds so issued.
(C) Said City reserves the right to issue bonds to
refund the $179,000 principal amount of Waterworks and Sewerage Revenue
Bonds, Series of 1956, herein authorized, or any portion thereof, with
the consent of the holders thereof, from time to time as may be deter-
mined necessary or expedient and for the best interests of this City,
and all such refunding bonds so authorized and issued shall be payable
from the income and revenue derived and to be derived from the opera-
tion of said system on a parity with any of the said $179,000 principal
amount Waterworks and Sewerage Revenue Bonds, Series of 1956, herein
authorized to be issued as may not be refunded and as may be outstand-
ing at the time of the issue and delivery of any of said refunding
bonds, as aforesaid.
(D) When the conditions specified in paragraphs A,
B and C of this section for the issue of additional bonds to complete
the construction of the improvements, extensions and repairs herein
authorized, or for the issue of additional bonds for the construction
of further necessary improvements, extensions, repairs and rehabilita-
tions, or for the refunding of the bonds herein authorized, have been
met, then upon the issue thereof any such additional bonds when issued
shall be entitled to the equal and proportionate benefit and security
of the pledge of the revenue and income derived and to be derived from
the operation of said system with the bonds herein authorized without
preference, priority or distinction as to participation of such pledge
of revenue, or in the preference of one bond or coupon of each of said
issues over or from any other issue, by reason of priority in execution
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issue, delivery or negotiation thereof, or by reason of the date or
dates of said bonds, or the date or dates of maturity thereof, or for
any other reason whatsoever, the intent hereof being that each and
all of said bonds, as aforesaid, and of coupons evidencing interest
thereon, shall have the same right and pledge as to payment and
security with the same,legal effect as if each and all of said bonds
and coupons had been executed, issued, delivered and negotiated
simultaneously as one proceeding.
Section 10. That the City of McHenry hereby covenants
and agrees with the holder or holders of said bonds that it will
punctually perform all duties with reference to said system, includ-
ing the making and collecting of sufficient rates for the use and
service of said system, all as required by the Constitution and laws
of the State of Illinois, and segregating the revenues of said system
and maintaining the Waterworks and Sewerage Fund and the application
of the respective Accounts created by this ordinance, and it hereby
covenants and. agrees not to sell, lease, loan, mortgage, or in any
manner dispose of or encumber said system, including any and all
extensions and improvements that may be made thereto, or the income
and revenue derived therefrom, except as permitted in Section 9
hereof, until all of the bonds herein authorized to be issued shall
have been paid in full, both principal and interest, or unless and
until provision shall have been made for the payment thereof.
And said City further covenants and agrees with the
holders of said Waterworks and Sewerage Revenue Bonds authorized
hereunder to maintain in good condition and continuously operate said
system, and to make, enact and enforce all needful rules and regula-
tions and ordinances for the efficient management and proper mainte-
nance and protection of such system, and for the use and service
thereof.
ME
Section 11. Said Waterworks and Sewerage Fund and
the Accounts created under Section 5 hereof, shall be audited within
sixty (60) days after the close of each fiscal year by an independent
firm of certified public accountants, and such audit and Accounts
shall be open for inspection at all proper times to any holder of
bonds issued under the provisions of this ordinance, or any one acting
for or on behalf of such bondholder. Such audit report shall include
the following items: (a) Balance Sheet, (b) Operating statement, (a)
Comments of the auditor relative to'the fulfillment of ordinance
provisions and the manner in which the system has been operated and
any recommendation for improving the operation of the system, (d)
Insurance data, (e) Number of metered customers; number of unmetered
customers; number of properties connected to the system; number of
hydrants, and (f) Gallons of water passing through master meter and
gallons of water billed, and copies of such audit report shall be
furnished the! original purchasers of the bonds herein authorized, and
shall also be! furnished to any bondholder upon request.
Section 12. That the provisions of this ordinance
shall constitute a contract between the City of McHenry and the holders
of the bonds herein authorized to be issued, and after the issuance
of said bonds no changes, additions or alterations of any kind shall
be made hereto, except as hereinbefore provided, until all of said
bonds and the interest thereon shall have been paid in full, or un-
less and until provision shall have been made for the payment thereof.
Section 13. That the proposal of Ballman & Main, of
Chicago, Illinois, to purchase the said bonds herein authorized in
accordance with their contract for the purchase thereof be and the
same is hereby in all respects ratified, approved and confirmed, and
said bonds when duly executed as provided herein shall be delivered
to the Treasurer who shall receipt for the payment of said bonds
against delivery thereof to said purchasers at a price of $171,000
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plus accrued interest from the date of said bonds to the date of
the delivery and payment thereof, the said purchase price being such
that the interest cost to this City does not exceed Six Per Cent
(W annually computed to maturity according to the standard table of
bond values, as provided and permitted by the statutes of the State
of Illinois thereunto enabling. All proceeds derived at the sale
and delivery of the said bonds shall be accounted for by said
Treasurer as follows:
(i) From the proceeds received as principal the sum
of $7,000, together with all accrued interest from the date of
the bonds to the date of the delivery and payment thereof
shall be deposited in the Bond Account at the American National
Bank and Trust Company of Chicago, Chicago, Illinois, to be
used and held for use solely to pay the interest on said bonds
during; the period of construction;
(ii) From the remaining proceeds received as principal,
together with the sum of $160,000 to be received from the pro-
ceeds of other bonds of said City authorized for that purpose
as hereinabove described in this ordinance, the Treasurer
shall deposit the sum of $324,000 in a separate and special
account of said City to be known and designated as the "Water-
works and Sewerage System Bond Construction Fund Account," and
such deposits shall be made in the American National Bank and
Trust Company of Chicago, Chicago, Illinois, as depositary,
to be secured in the manner, form and time as by law required,
and all proceeds held in said Construction Fund Account shall
be used and held for use solely to construct the improvements,
extensions and repairs to the combined waterworks and sewerage
system of said City, as hereinabove described in this ordinance,
and the beneficial interest to all moneys held in said Construc-
tion Fund Account at the time of the original deposit therein
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and from time to time thereafter shall be in the holder or
holders of the bonds herein authorized, and all disbursements
therefrom shall be made by the Treasurer from time to time but
only upon submission to him and to said depositary of:
(a) a certificate by the engineer in responsible charge
of the construction of said improvements and extensions
stating the nature of the work completed and the amount due
and payable thereon, and that sufficient funds remain to
complete the construction thereof, bearing the endorsement
and approval of the Mayor of said City and accompanied by;
(b) an order for payment upon said Treasurer signed by
the Mayor of said City and the City Clerk, which order shall
state specifically the purpose for which said order is issued;
and the Mayor of said City, the City Clerk, and the City
Treasurer are each hereby authorized and directed to execute
and deliver to the American National Bank and Trust Company
of Chicago, Chicago, Illinois, as depositary, such certifi-
cates, proceedings, and agreements as may be necessary or
convenient to establish said Construction Fund Account herein
created and to properly secure all proceeds thereof, and to
evidence compliance herewith in the making of any with-
drawals therefrom.
Within the sixty (60) days after completion of the
construction of the improvements and extensions herein authorized,
the City of McHenry agrees to deliver to said depositary an original
counterpart of a certificate (herein called the "Certificate of Comple-
tion") signed by the Mayor and by the City Treasurer, and having en-
dorsed thereon the approval of the engineer in charge of such construc-
tion, stating that said improvements, extensions and repairs have been
fully constructed and completed in accordance with the plans, maps,
files and specifications therefor as recited in this ordinance, and
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that the same have been fully paid for, or that funds sufficient
so to pay for the same remain in said Construction Fund Account,
giving the date of final completion and the total cost of construc-
tion, and the amount,, if any,,of ,such construction cost then remain-
ing unpaid, together with an original counterpart of the opinion of
counsel for said City to the effect that all property, real, personal
and mired, connected with or forming a part of, or necessary to the
operation of said system as completed, is owned by said City and
covered by the lien of this ordinance, and upon receipt of such
Certificate o:f Completion and opinion of counsel as mentioned, said
depositary, after retaining in said Construction Fund Account a sum
sufficient to pay the balance of the construction cost remaining
unpaid as shown by said Certificate of Completion, including any
items then in controversy, shall deposit all moneys then remaining
with the American National Bank and Trust Company of Chicago, Chicago,
Illinois, the paying agent for said bonds, in the Bond Account herein
created.
Section 14. 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 other provisions of this ordinance.
Section 15. All ordinances, resolutions, or orders,
or parts thereof, in conflict with the provisions of this ordinance
are, to the extent of such conflict, hereby repealed.
Section 16. This ordinance, after its passage and
approval by the Mayor shall be published once in - !McHenry Plaindealer -
McHenry# Illinoia.
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A w _
a newspaper published and having a general circulation in the City
of McHenry, and shall be in full force and effect after such publica-
tion in the manner, form and time as provided by the laws of the
State of Illinois thereunto enabling.
Passed - March 19th. 1956.
Ayes:
Antonson - Hroym - Dixon - Gausden - Kauss -
Nays: None -
Approved March 19th. - 1956.
Mayor
At t ) i
City Mer
Published - March 29th. - 1956.
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