To: Martin L. Cousineau, Finance Committee Chairperson
From: Jeff Wright, Drain Commissioner, Genesee County Water & Waste Services
title
RE: Bond Ordinance
recommendation
BOARD ACTION REQUESTED:
Pass Bond Ordinance
BACKGROUND:
Refinance $80 million bonds currently sold
DISCUSSION:
Genesee County Drain Commissioner’s Office - Division of Water & Waste Services currently as $80 million in 2015 and 2015 water revenue bonds. At this time, we are requesting authorization to refinance revenue bonds with LTGOB for the current bonds. Based on the current market, the project savings will be $30 million over the remaining 20 years.
IMPACT ON HUMAN RESOURCES:
None
IMPACT ON BUDGET:
General Funds - None.
IMPACT ON FACILITIES:
None.
IMPACT ON TECHNOLOGY:
None
CONFORMITY TO COUNTY PRIORITIES:
Conformance with GCDC-WWS Master Plan.
resolution
ORDINANCE NO. 2025-____
AN ORDINANCE TO PROVIDE FOR THE ISSUANCE AND SALE OF WATER SUPPLY SYSTEM REVENUE REFUNDING BONDS FOR THE PURPOSE OF REFUNDING CERTAIN OUTSTANDING REVENUE BONDS OF THE WATER SUPPLY SYSTEM OF THE COUNTY OF GENESEE, MICHIGAN; TO PRESCRIBE THE FORM OF THE REVENUE REFUNDING BONDS; TO PROVIDE FOR THE RETIREMENT AND SECURITY OF THE REVENUE REFUNDING BONDS HEREIN AUTHORIZED; AND TO PROVIDE FOR OTHER MATTERS RELATIVE TO THE SYSTEM AND THE REVENUE REFUNDING BONDS.
WHEREAS, the County of Genesee, State of Michigan (the “County”) has previously issued the Outstanding Bonds (as hereinafter defined) to defray the cost of certain improvements and extensions to the Genesee County Water Supply System; and
WHEREAS, the County has been advised that it may be able to achieve interest cost savings by refunding all or portions of the callable maturities of the outstanding Series 2015 Bonds and the Series 2016B Bonds (each as hereinafter defined) (the portions of the Series 2015 Bonds and the Series 2016B Bonds to be refunded, as hereinafter provided, is referred to as the “Refunded Bonds”); and
WHEREAS, the cost of refunding the Refunded Bonds, including incidental financing and legal expenses, is estimated to be approximately Eighty Million Dollars ($80,000,000); and
WHEREAS, the Outstanding Ordinances (as hereinafter defined) authorize the issuance of additional Bonds for the purpose of, among other things, refunding all or part of the Outstanding Bonds and paying the costs of issuing such additional Bonds; and
WHEREAS, to pay the cost of refunding the Refunded Bonds, including incidental financing and legal expenses, the County has determined that it is necessary to issue additional Bonds therefor, in one or more series, in the aggregate principal amount of not to exceed Eighty Million Dollars ($80,000,000); and
WHEREAS, all things necessary to the authorization and issuance of additional Bonds under the Constitution and laws of the State of Michigan and the Master Ordinance (as hereinafter defined) have been done or will be completed prior to the issuance of the additional Bonds, and the Board of Commissioners of the County is now empowered and desires to authorize the issuance of said additional Bonds.
THE COUNTY OF GENESEE ORDAINS:
Section 1. Definitions. Capitalized terms used in this Ordinance and not otherwise defined herein shall have the meanings assigned to such terms in the Master Ordinance. In addition to the terms defined in the Master Ordinance, the following terms as used in this Ordinance shall have the following meanings:
“Act 34” means Act 34, Public Acts of Michigan, 2001, as amended.
“Act 94” means Act 94, Public Acts of Michigan, 1933, as amended.
“Act 342” means Act 342, Public Acts of Michigan, 1939, as amended.
“Code” means the Internal Revenue Code of 1986, as amended, and the rulings and regulations (including temporary and proposed) promulgated thereunder.
“County” means the County of Genesee, State of Michigan.
“County Agency” means the Genesee County Drain Commissioner, as the designated “county agency” pursuant to Act 342.
“Master Ordinance” means Ordinance No. 03-03 of the County adopted on March 25, 2003.
“Outstanding Bonds” means, collectively, the Series 2015 Bonds, the Series 2016A Bond, the Series 2016B Bonds, the Series 2017A Bonds, the Series 2023 Bonds and the Series 2024 Bonds.
“Outstanding Ordinances” means, collectively, the Master Ordinance and Ordinance Nos. 03-05, 06-06, 12-02, 12-03, 13-01, 13-02, 16-03, 16-04, 2023-238, and 2024-524 of the County.
“Refunded Bonds” means (i) the outstanding callable maturities of the 2015 Bonds, or such portions thereof as may be determined by the County Agency at the time of sale of the Series 2025 Bonds, and (ii) the outstanding callable maturities of the Series 2016B Bonds, or such portions thereof as may be determined by the County Agency at the time of sale of the Series 2025 Bonds.
“Sale Order” means, with respect to each series of the Series 2025 Bonds issued pursuant to this Ordinance, an order of the County Agency awarding the sale of such series of the Series 2025 Bonds and approving the final terms of such series of the Series 2025 Bonds as provided in this Ordinance.
“Series 2015 Bonds” means the County’s Water Supply System Revenue Bonds (Limited Tax General Obligation), Series 2015, in the original principal amount of $60,000,000.
“Series 2016A Bond” means the County’s Water Supply System Revenue Bond (Limited Tax General Obligation), Series 2016A, in the original principal amount of $6,430,000.
“Series 2016B Bonds” means the County’s Water Supply System Revenue and Revenue Refunding Bonds (Limited Tax General Obligation), Series 2016B, in the original principal amount of $56,895,000.
“Series 2017A Bonds” means the County’s Water Supply System Revenue Bonds (Limited Tax General Obligation), Series 2017A, in the original principal amount of $10,500,000.
“Series 2023 Bonds” means the County’s Water Supply System Revenue Refunding Bonds (Limited Tax General Obligation), Series 2023, in the original principal amount of $23,695,000.
“Series 2024 Bonds” means the County’s Water Supply System Revenue Refunding Bonds (Limited Tax General Obligation), Series 2024, in the original principal amount of $43,985,000.
“Series 2025 Bonds” means the Water Supply System Revenue Refunding Bonds (Limited Tax General Obligation), Series 2025, to be issued in one or more series pursuant to Section 4 of this Ordinance.
“Transfer Agent” means, with respect to the Series 2025 Bonds, the bank or trust company appointed from time to time to act as paying agent, registrar and transfer agent for the Series 2025 Bonds as provided in Section 5 of this Ordinance.
Section 2. Necessity; Public Purpose; Estimated Cost. It is hereby determined and declared to be a necessary public purpose of the County to refund the Refunded Bonds. The estimated cost of refunding the Refunded Bonds, including incidental financing and legal expenses, in the amount of not to exceed Eighty Million Dollars ($80,000,000), is hereby approved and confirmed.
Section 3. Payment of Cost; Series 2025 Bonds Authorized. To pay the costs of refunding the Refunded Bonds, including financial, legal and other expenses incident thereto and incident to the issuance and sale of the Series 2025 Bonds, the County shall borrow the aggregate principal sum of not to exceed Eighty Million Dollars ($80,000,000) and issue the Series 2025 Bonds therefor, in one or more series, pursuant to the provisions of Act 94. The remaining costs of refunding the Refunded Bonds, if any, shall be defrayed from funds of the System on hand and legally available for such use.
Except as amended by or expressly provided to the contrary in this Ordinance, all of the provisions of the Outstanding Ordinances shall apply to the Series 2025 Bonds issued pursuant to this Ordinance, the same as though each of said provisions were repeated in this Ordinance in detail; the purpose of this Ordinance being to authorize the issuance of additional Bonds of equal standing and priority of lien as to the Net Revenues with the Outstanding Bonds for the purpose of refunding the Refunded Bonds and paying the costs of issuing the Series 2025 Bonds as herein provided. The issuance of additional Bonds for such purpose is authorized by the provisions of Section 20 of the Master Ordinance, upon the conditions therein stated, which conditions have been fully met.
Section 4. Issuance of Series 2025 Bonds; Details. Bonds of the County, to be designated “WATER SUPPLY SYSTEM REVENUE REFUNDING BONDS (LIMITED TAX GENERAL OBLIGATION), SERIES 2025” (or with such alternate series designations and with any appropriate subseries designations as may be deemed appropriate by the County Agency) (the “Series 2025 Bonds”), are authorized to be issued in one or more series in the aggregate principal amount of not to exceed Eighty Million Dollars ($80,000,000), as finally determined by the County Agency in the Sale Order, for the purpose of refunding all or a portion of the Refunded Bonds, as finally determined by the County Agency in the Sale Order, and paying costs incidental to the issuance of the Series 2025 Bonds. The Series 2025 Bonds may be issued in one or more series, as finally determined by the County Agency. The Series 2025 Bonds shall be payable out of the Net Revenues, as set forth more fully in Section 6 hereof.
The Series 2025 Bonds shall consist of fully-registered bonds of the denomination of $5,000 each, or integral multiples of $5,000 not exceeding for each maturity the aggregate principal amount of that maturity, shall be dated as of a date determined by the County Agency in the Sale Order, and shall be numbered in order of registration. The Series 2025 Bonds may be issued as serial bonds or term bonds, or both, and shall mature or be subject to mandatory redemption on the dates and in the principal amounts as determined by the County Agency in the Sale Order; provided, however, that the final maturity date of each series of the Series 2025 Bonds shall be not later than February 1, 2048.
The Series 2025 Bonds of each series shall bear interest at the rate or rates to be determined at the time of sale thereof, but in any event not exceeding six percent (6%) per annum, payable semi-annually on such dates as determined by the County Agency in the Sale Order, commencing on the date determined by the County Agency in the Sale Order, by check or draft mailed by the Transfer Agent to the person or entity who or which is, as of the 15th day of the month preceding each interest payment date, the registered owner at the registered address as shown on the registration books of the County maintained by the Transfer Agent. The date of determination of registered owner for purposes of payment of interest as provided in this paragraph may be changed by the County to conform to market practice in the future. The principal of the Series 2025 Bonds shall be payable at the designated office of the Transfer Agent.
The Series 2025 Bonds shall initially be issued in book-entry-only form through The Depository Trust Company in New York, New York (“DTC”). So long as the Series 2025 Bonds are in book-entry-only form, the Transfer Agent shall comply with the terms of the Letter of Representations to be entered into among the County, the Transfer Agent and DTC, which provisions shall govern registration, notices and payment, among other things, and which provisions are incorporated herein with the same effect as if fully set forth herein. The Chief Financial Officer of the County and the County Agency are each hereby authorized and directed to enter into the Letter of Representations with DTC for and on behalf of the County. In the event the County determines that the continuation of the system of book-entry-only transfer through DTC (or successor securities depository) is not in the best interest of the DTC participants, beneficial owners of the Series 2025 Bonds, or the County, the County will notify the Transfer Agent, whereupon the Transfer Agent will notify DTC of the availability through DTC of bond certificates. In such event, the County shall issue and the Transfer Agent shall transfer and exchange bonds as requested by DTC of like principal amount, series and maturity, in authorized denominations, to the identifiable beneficial owners in replacement of the beneficial interest of such beneficial owners in the bonds.
The Series 2025 Bonds shall be subject to redemption prior to maturity at the times and prices and in the manner determined by the County Agency in the Sale Order and as permitted by law, provided that the redemption premium on the Series 2025 Bonds may not exceed three percent (3%). Unless waived by any registered owner of the Series 2025 Bonds to be redeemed, notice of redemption shall be given in the manner specified in the form of the Series 2025 Bonds set forth in Section 11 of this Ordinance.
The Series 2025 Bonds shall be executed in the name of the County with the manual or facsimile signatures of the Chairman of the Board of Commissioners and the County Clerk and shall have the seal of the County or a facsimile thereof impressed or printed thereon. No Series 2025 Bond shall be valid until authenticated by an authorized representative of the Transfer Agent. The Series 2025 Bonds shall be delivered to the Transfer Agent for authentication and be delivered by the Transfer Agent to the purchaser thereof in accordance with instructions from the County Agency upon payment to the County of the purchase price for the Series 2025 Bonds. Executed blank bonds for registration and issuance to transferees shall simultaneously, and from time to time thereafter as necessary, be delivered to the Transfer Agent for safekeeping.
Section 5. Transfer Agent; Registration and Transfer. The County Agency shall appoint a bank or trust company qualified under Michigan law to act as Transfer Agent with respect to the Series 2025 Bonds. Any Series 2025 Bond may be transferred upon the books required to be kept pursuant to this Section by the person in whose name it is registered, in person or by the registered owner’s duly authorized attorney, upon surrender of the Series 2025 Bond for cancellation, accompanied by delivery of a duly executed written instrument of transfer in a form approved by the Transfer Agent. Whenever any Series 2025 Bond or Bonds shall be surrendered for transfer, the County shall execute and the Transfer Agent shall authenticate and deliver a new Series 2025 Bond or Bonds, for like aggregate principal amount. The Transfer Agent shall require payment by the bondholder requesting the transfer of any tax or other governmental charge required to be paid with respect to the transfer. The Transfer Agent shall not be required (i) to issue, register the transfer of or exchange any Series 2025 Bond during a period beginning at the opening of business 15 days before the day of the giving of a notice of redemption of Series 2025 Bonds selected for redemption and ending at the close of business on the day of that giving of notice, or (ii) to register the transfer of or exchange any Series 2025 Bond so selected for redemption in whole or in part, except the unredeemed portion of Series 2025 Bonds being redeemed in part. Unless waived by the Transfer Agent, the County shall give the Transfer Agent notice of call for redemption at least 20 days prior to the date notice of redemption is to be given.
The Transfer Agent shall keep or cause to be kept, at its principal office, sufficient books for the registration and transfer of the Series 2025 Bonds, which shall at all times be open to inspection by the County; and, upon presentation for such purpose, the Transfer Agent shall, under such reasonable regulations as it may prescribe, transfer or cause to be transferred, on said books, Series 2025 Bonds as hereinbefore provided.
If any Series 2025 Bond shall become mutilated, the County, at the expense of the holder of the Series 2025 Bond, shall execute, and the Transfer Agent shall authenticate and deliver, a new Series 2025 Bond of like tenor in exchange and substitution for the mutilated Series 2025 Bond, upon surrender to the Transfer Agent of the mutilated Series 2025 Bond. If any Series 2025 Bond issued under this Ordinance shall be lost, destroyed or stolen, evidence of the loss, destruction or theft may be submitted to the Transfer Agent and, if this evidence is satisfactory to both and indemnity satisfactory to the Transfer Agent shall be given, and if all requirements of any applicable law, including Act 354, Public Acts of Michigan, 1972, as amended (“Act 354”), have been met, the County, at the expense of the owner, shall execute, and the Transfer Agent shall thereupon authenticate and deliver, a new Series 2025 Bond of like tenor and bearing the statement required by Act 354, or any applicable law hereafter enacted, in lieu of and in substitution for the Series 2025 Bond so lost, destroyed or stolen. If any such Series 2025 Bond shall have matured or shall be about to mature, instead of issuing a substitute Series 2025 Bond, the Transfer Agent may pay the same without surrender thereof.
Section 6. Payment of Series 2025 Bonds; Priority of Lien; Pledge of Full Faith and Credit. Principal of and interest on the Series 2025 Bonds shall be payable from the Net Revenues of the System, and to secure such payment, there is hereby recognized the statutory lien upon the whole of the Net Revenues created by the Master Ordinance, which shall be a first lien to continue with respect to the Series 2025 Bonds until payment in full of the principal of and interest on the Series 2025 Bonds, or until sufficient cash or Sufficient Government Obligations have been deposited in trust for payment in full of all principal and interest on the Series 2025 Bonds then outstanding to maturity, or, if called for redemption, to the date fixed for redemption. The statutory first lien referred to herein shall be of equal standing and priority of lien as to the Net Revenues with the Outstanding Bonds. Upon deposit of sufficient cash or Sufficient Government Obligations for payment in full of all principal and interest on a series of the Series 2025 Bonds then outstanding, as provided in the previous sentence, the statutory lien shall be terminated with respect to that series of the Series 2025 Bonds, the holders of that series of the Series 2025 Bonds shall have no further rights under this Ordinance or the Outstanding Ordinances, except for payment from the deposited funds and for rights of replacement, registration and transfer, and such series of the Series 2025 Bonds shall no longer be considered to be outstanding under this Ordinance or the Outstanding Ordinances.
In addition, as additional security for the payment of the principal of and interest on the Series 2025 Bonds, the County, pursuant to the provisions of Act 342, hereby irrevocably pledges its full faith and credit for the prompt payment of the principal of and interest on the Series 2025 Bonds. Should the Net Revenues of the System at any time be insufficient to pay the principal of and interest on the Series 2025 Bonds when due, then the County shall advance from any funds available therefor, or, if necessary, levy taxes upon all taxable property in the County, subject to applicable constitutional and statutory limitations, such sums as may be necessary to pay said principal and interest. If the County shall be required to pay principal of and interest on the Series 2025 Bonds from its general funds, it shall be reimbursed the amount paid as soon as possible from the Net Revenues of the System.
Section 7. Bondholders’ Rights; Receiver. The holder or holders of a series of the Series 2025 Bonds representing in the aggregate not less than twenty percent (20%) of the entire principal amount thereof then outstanding, may, by suit, action, mandamus or other proceedings, protect and enforce the statutory lien upon the Net Revenues of the System and may, by suit, action, mandamus or other proceedings, enforce and compel performance of all duties of the officers of the County, including the fixing of sufficient rates, the collection of Revenues, the proper segregation of the Revenues of the System and the proper application thereof. The statutory lien upon the Net Revenues, however, shall not be construed as to compel the sale of the System or any part thereof.
If there is a default in the payment of the principal of or interest on the Series 2025 Bonds, any court having jurisdiction in any proper action may appoint a receiver to administer and operate the System on behalf of the County and under the direction of the court, and by and with the approval of the court to perform all of the duties of the officers of the County more particularly set forth herein and in Act 94.
The holder or holders of the Series 2025 Bonds shall have all other rights and remedies given by Act 94 and law, for the payment and enforcement of the Series 2025 Bonds and the security therefor.
Section 8. Rates and Charges. The rates and charges for service furnished by and the use of the System and the methods of collection and enforcement of the collection of the rates shall be those established by the County Agency and in effect on the date of adoption of this Ordinance, as the same may be modified by the Count Agency from time to time. The rates presently in effect in the County as established by the County Agency are estimated to be sufficient to provide for the payment of the expenses of administration and operation and such expenses for maintenance of the System as are necessary to preserve the System in good repair and working order, to provide for the payment of the principal of and interest on the Outstanding Bonds and the Series 2025 Bonds as the same become due and payable and to provide for all other obligations, expenditures and funds for the System required by law, this Ordinance and the Outstanding Ordinances. In addition, it is hereby covenanted and agreed that the rates shall be reviewed and shall be fixed and revised from time to time as may be necessary to produce these amounts, and it is hereby covenanted and agreed to fix and maintain rates for services furnished by the System at all times sufficient to provide for the foregoing.
Section 9. No Free Service or Use. No free service or use of the System, or service or use of the System at less than the reasonable cost and value thereof, shall be furnished by the System to any person, firm or corporation, public or private, or to any public agency or instrumentality, including the County.
Section 10. Bond Proceeds; Escrow Fund. The proceeds of the Series 2025 Bonds shall be used to secure payment of the Refunded Bonds and to pay the costs of issuance of the Series 2025 Bonds as provided in this Section. Upon receipt of the proceeds of a series of the Series 2025 Bonds, the accrued interest, if any, shall be deposited into the Bond and Interest Redemption Account established by the Master Ordinance. From the proceeds of such series of the Series 2025 Bonds there shall next be set aside a sum sufficient to pay the costs of issuance of such series of the Series 2025 Bonds. Such funds may be deposited in an account established by the County or by the Escrow Agent (as hereinafter defined). Such funds shall be used solely to pay the costs of issuance of such series of the Series 2025 Bonds, and if any such funds shall not be required to pay the costs of issuance of such series of the Series 2025 Bonds, the surplus shall be transferred to the Bond and Interest Redemption Account or used for any other purpose permitted by applicable law.
The balance of the proceeds of a series of the Series 2025 Bonds, together with other available funds of the County, if any, shall be deposited into one or more escrow funds (the “Escrow Fund”) and shall be held in cash or invested in direct obligations of the United States of America or obligations the principal of and interest on which are fully guaranteed by the United States of America, not redeemable at the option of the issuer thereof (the “Government Obligations”), and used to pay the principal of and interest on all or a portion of the Refunded Bonds as shall be finally identified in the Sale Order. The Escrow Fund shall be held by an escrow agent (the “Escrow Agent”), in trust, pursuant to one or more escrow agreements (the “Escrow Agreement”) which shall irrevocably direct the Escrow Agent to take all necessary steps to call for redemption the Refunded Bonds specified in the Sale Order, including publication and mailing of redemption notices. The Government Obligations held in the Escrow Fund shall be such that the principal and interest payments received thereon will be sufficient, without reinvestment, to pay the principal of and interest on the Refunded Bonds when due and upon call of the Refunded Bonds for redemption as provided in this paragraph. The County Agency is authorized to select and retain a bank or trust company to serve as Escrow Agent pursuant to the Escrow Agreement and to execute and deliver the Escrow Agreement for and on behalf of the County. The Chief Financial Officer of the County and the County Agency are each hereby individually authorized to designate and empower the Escrow Agent to subscribe for United States Treasury Securities, State and Local Government Series, on behalf of the County, as may be necessary in connection with the refunding of the Refunded Bonds. In the alternative, the Chief Financial Officer of the County and the County Agency are each hereby individually authorized, on behalf of the County, to solicit bids for and to purchase Government Obligations on the open market as may be necessary to accomplish the refunding of the Refunded Bonds as provided in this paragraph.
Section 11. Form of Series 2025 Bonds. The Series 2025 Bonds of each series shall be in substantially the following form, with such changes or completions as are necessary or appropriate to give effect to the intent of this Ordinance:
R-__
UNITED STATES OF AMERICA
STATE OF MICHIGAN
COUNTY OF GENESEE
WATER SUPPLY SYSTEM REVENUE REFUNDING BOND
(LIMITED TAX GENERAL OBLIGATION), SERIES 2025[__]
|
Interest Rate |
Maturity Date |
Date of Original Issue |
CUSIP |
|
|
|
|
|
REGISTERED OWNER:
PRINCIPAL AMOUNT:
The County of Genesee, State of Michigan (the “Issuer”), acknowledges itself to owe and for value received hereby promises to pay, out of the hereinafter described Net Revenues of the Issuer’s System (hereinafter defined), the Principal Amount specified above, in lawful money of the United States of America, to the Registered Owner specified above, or registered assigns, on the Maturity Date specified above, unless prepaid prior thereto as hereinafter provided, with interest thereon (computed on the basis of a 360 day year consisting of twelve 30-day months) from the Date of Original Issue specified above or such later date to which interest has been paid, until paid, at the Interest Rate per annum specified above, first payable on ______________, 202_, and semiannually thereafter. Principal of this bond is payable at the designated corporate trust office of ________________________, __________, Michigan or such other transfer agent as the Issuer may hereafter designate by notice mailed to the registered owner not less than sixty (60) days prior to any interest payment date (the “Transfer Agent”). Interest on this bond is payable by check or draft mailed by the Transfer Agent to the person or entity who or which is, as of the fifteenth (15th) day of the month preceding the interest payment date, the registered owner of record, at the registered address as shown on the registration books of the Issuer kept by the Transfer Agent. For prompt payment of principal of and interest on this bond, the Issuer has irrevocably pledged the revenues of the Genesee County Water Supply System, including all appurtenances, extensions and improvements thereto (the “System”), after provision has been made for reasonable and necessary expenses of operation, maintenance and administration thereof (the “Net Revenues”), and a statutory first lien thereon is hereby recognized and created.
This bond is one of a series of bonds of even Date of Original Issue aggregating the principal sum of $__________, issued pursuant to Ordinance Nos. 03-03 and _____, duly adopted by the Board of Commissioners of the Issuer (the “Ordinances”), and under and in full compliance with the Constitution and statutes of the State of Michigan, including specifically Act 94, Public Acts of Michigan, 1933, as amended, and Act 342, Public Acts of Michigan, 1939, as amended (“Act 342”), for the purpose of refunding [portions of the Issuer’s outstanding Water Supply System Revenue Bonds (Limited Tax General Obligation), Series 2015 and Water Supply System Revenue and Revenue Refunding Bonds (Limited Tax General Obligation), Series 2016B].
For a complete statement of the revenues from which and the conditions under which this bond is payable, a statement of the conditions under which additional bonds of equal standing as to the Net Revenues may hereafter be issued and the general covenants and provisions pursuant to which this bond is issued, reference is made to the Ordinances. The bonds of this issue are of equal standing and priority of lien as to the Net Revenues with the outstanding bonds of the Issuer’s (i) Water Supply System Revenue Bonds (Limited Tax General Obligation), Series 2015, (ii) Water Supply System Revenue Bond (Limited Tax General Obligation), Series 2016A, (iii) Water Supply System Revenue and Revenue Refunding Bonds (Limited Tax General Obligation), Series 2016B, (iv) Water Supply System Revenue Bonds (Limited Tax General Obligation), Series 2017A, (v) Water Supply System Revenue Refunding Bonds (Limited Tax General Obligation), Series 2023, and (vi) Water Supply System Revenue Refunding Bonds (Limited Tax General Obligation), Series 2024 (collectively, the “Outstanding Bonds”). The Issuer has reserved the right to issue additional bonds of equal standing with the bonds of this issue and the Outstanding Bonds on conditions stated in the Ordinances.
Bonds of this issue maturing in the years 20__ to 20__, inclusive, are not subject to redemption prior to maturity. Bonds or portions of bonds of this issue in multiples of $5,000 maturing in the year 20__ and thereafter are subject to redemption prior to maturity at the option of the Issuer, in such order as the Issuer shall determine and within any maturity by lot, on any date on or after __________, 20__, at par plus accrued interest to the date fixed for redemption.
[Insert term bond provisions, if applicable]
In case less than the full amount of an outstanding bond is called for redemption, the Transfer Agent, upon presentation of the bond called in part for redemption, shall register, authenticate and deliver to the registered owner a new bond in the principal amount of the portion of the original bond not called for redemption.
Notice of redemption of any bond or portion thereof shall be given by the Transfer Agent at least thirty (30) days prior to the date fixed for redemption by mail to the registered owner at the registered address shown on the registration books kept by the Transfer Agent. Bonds shall be called for redemption in multiples of $5,000 and any bond of a denomination of more than $5,000 shall be treated as representing the number of bonds obtained by dividing the denomination of the bond by $5,000 and such bond may be redeemed in part. Notice of redemption for a bond redeemed in part shall state that upon surrender of the bond to be redeemed a new bond or bonds in aggregate principal amount equal to the unredeemed portion of the bonds surrendered shall be issued to the registered owner thereof. No further interest on a bond or portion thereof called for redemption shall accrue after the date fixed for redemption, whether presented for redemption or not, provided funds are on hand with the Transfer Agent to redeem the bond or portion thereof.
This bond is a self-liquidating bond, payable, both as to principal and interest, from the Net Revenues of the System. The principal of and interest on this bond are secured by the statutory lien hereinbefore mentioned. As additional security for the payment of the principal of and interest on this bond and the series of bonds of which this is one, the Issuer, pursuant to the provisions of Act 342, and the Ordinances, has pledged its full faith and credit for the prompt payment of the principal of and interest hereon. Pursuant to such pledge, if the Net Revenues of the System are at any time insufficient to pay the principal of and interest on this bond when due, then the Issuer shall advance from its general funds available therefor, or, if necessary, levy taxes upon all taxable property in the Issuer, subject to applicable constitutional and statutory tax rate limitations, such sums as may be necessary to pay said principal and interest.
The Issuer has covenanted and agreed, and does hereby covenant and agree, to fix and maintain at all times while any bonds payable from the Net Revenues of the System shall be outstanding, such rates for service furnished by the System as shall be sufficient to provide for payment of the interest on and the principal of the bonds of this issue, the Outstanding Bonds and any additional bonds of equal standing as and when the same shall become due and payable, and to create and maintain a Bond and Interest Redemption Account therefor, to provide for the payment of expenses of administration and operation and such expenses for maintenance of the System as are necessary to preserve the same in good repair and working order, and to provide for such other expenditures and funds for the bonds of this issue, the Outstanding Bonds and the System as are required by the Ordinances.
This bond is transferable only upon the books of the Issuer kept for that purpose at the office of the Transfer Agent by the registered owner hereof in person, or by the registered owner’s attorney duly authorized in writing, upon the surrender of this bond together with a written instrument of transfer satisfactory to the Transfer Agent duly executed by the registered owner or the registered owner’s attorney duly authorized in writing, and thereupon a new registered bond or bonds in the same aggregate principal amount and of the same maturity shall be issued to the transferee in exchange therefor as provided in the Ordinances, and upon the payment of the charges, if any, therein prescribed.
Capitalized terms used in this bond and not defined herein have the meanings set forth in the Ordinances.
It is hereby certified and recited that all acts, conditions and things required by law to be done precedent to and in the issuance of this bond and the series of bonds of which this is one have been done and performed in regular and due time and form as required by law.
This bond is not valid or obligatory for any purpose until the Transfer Agent’s Certificate of Authentication on this bond has been executed by the Transfer Agent.
IN WITNESS WHEREOF, the Issuer, by its Board of Commissioners, has caused this bond to be executed with the facsimile signatures of its Chairman and the County Clerk and a facsimile of its corporate seal to be printed on this bond, all as of the Date of Original Issue.
COUNTY OF GENESEE
By: __________________________________________
Chairman, Board of Commissioners
(Seal)
Countersigned:
By:
County Clerk
[Bond printer to insert Certificate of Authentication and form of assignment]
Section 12. Covenants Regarding Tax-Exempt Status of the Series 2025 Bonds. The County shall, to the extent permitted by law, take all actions within its control necessary to maintain the exclusion of the interest on the Series 2025 Bonds from gross income for federal income tax purposes under the Code, including, but not limited to, actions relating to any required rebate of arbitrage earnings and the expenditure and investment of proceeds of the Series 2025 Bonds and moneys deemed to be proceeds of the Series 2025 Bonds, and to prevent the Series 2025 Bonds from being or becoming “private activity bonds” as that term is used in Section 141 of the Code.
Section 13. Negotiated Sale of Series 2025 Bonds. The County has considered the option of selling the Series 2025 Bonds through a competitive sale and a negotiated sale and, pursuant to the requirements of Act 94, and based on the recommendation of the County’s financial advisor for the Series 2025 Bonds, determines that a negotiated sale of the Series 2025 Bonds is in the best interests of the County and will provide the County with greater flexibility in structuring the terms of the Series 2025 Bonds and in accessing the municipal bond market at the time that is expected to achieve the most advantageous interest rates for the County.
Section 14. Award of Sale of Series 2025 Bonds. J.P. Morgan Securities LLC is hereby appointed as senior managing underwriter for the Series 2025 Bonds (the “Underwriter”). The County Agency is authorized to negotiate the sale of each series of the Series 2025 Bonds to the Underwriter, award the sale of each series of the Series 2025 Bonds to the Underwriter pursuant to a bond purchase agreement, execute and deliver the bond purchase agreement with the Underwriter for and on behalf of the County, and execute a Sale Order specifying the final terms of each series of the Series 2025 Bonds and making such other determinations as provided for in this Ordinance, without further approval of this Board of Commissioners, subject to the following terms:
(a) The final terms of the Series 2025 Bonds shall be within the parameters established by this Ordinance;
(b) The underwriter’s discount shall not exceed 0.60% of the principal amount of the Series 2025 Bonds;
(c) The net present value savings to be realized upon the refunding of the Refunded Bonds shall not be less than three percent (3.00%) of the principal amount of the Refunded Bonds; and
(d) The true interest cost of each series of the Series 2025 Bonds shall not exceed 5.00%.
Section 15. Approval of Details of Series 2025 Bonds. The County Agency is hereby authorized to adjust the final bond details set forth herein to the extent necessary or convenient to complete the transactions authorized herein, and in pursuance of the foregoing is authorized to exercise the authority and make the determinations authorized pursuant to Section 7a(1)(c) of Act 94 and Section 315(1)(d) of Act 34, including, but not limited to, determinations regarding interest rates, prices, discounts, serial and term maturities, principal amounts, denominations, dates of issuance, interest payment dates, redemption rights, the place of delivery and payment, designation of series, and other matters necessary to effectuate the sale and issuance of the Series 2025 Bonds authorized herein, within the parameters established by this Ordinance.
Section 16. Official Statement; Bond Insurance; Ratings. The County Agency and the Chief Financial Officer of the County are authorized and directed to: (a) cause the preparation and circulation of a Preliminary Official Statement with respect each series of the Series 2025 Bonds and to deem the Preliminary Official Statement “final” for purposes of Rule 15c2-12 of the U.S. Securities and Exchange Commission, and to approve circulation of a final Official Statement with respect to each series of the Series 2025 Bonds; (b) solicit bids for and approve the purchase of a municipal bond insurance policy for any series of the Series 2025 Bonds if deemed economically advantageous to the County based on the advice of the County’s financial advisor for the Series 2025 Bonds; and (c) obtain ratings on the Series 2025 Bonds.
Section 17. Authorization of Other Actions. The County Agency, Chairman of the Board of Commissioners, Chief Financial Officer and County Clerk are each hereby individually authorized to complete, execute and file any and all applications or requests for waivers with the Michigan Department of Treasury necessary to effectuate the sale and delivery of the Series 2025 Bonds as contemplated by this Ordinance, including, if necessary, an Application for State Treasurer’s Approval to Issue Long-Term Securities, in such form as shall be approved by any of such officers. The County Agency and County Treasurer are further authorized to pay any necessary fees in connection with any such applications or waivers. The County Agency, County Treasurer, Chief Financial Officer and County Clerk are each hereby individually authorized and directed to execute and deliver all other documents and certificates and to take all other actions and to make such other filings with any parties necessary or advisable to enable the sale and delivery of the Series 2025 Bonds as contemplated herein.
Section 17. Continuing Disclosure. The County hereby agrees to enter into a continuing disclosure undertaking for the benefit of the holders and beneficial owners of each series of the Series 2025 Bonds pursuant to Rule 15c2-12 of the U.S. Securities and Exchange Commission, and the County Agency and the Chief Financial Officer are each hereby individually authorized to negotiate and execute such undertaking prior to delivery of each series of the Series 2025 Bonds.
Section 18. Severability; Paragraph Headings; and Conflict. 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. The paragraph headings in this Ordinance are furnished for convenience of reference only and shall not be considered to be part of this Ordinance.
Section 19. Publication and Recordation. This Ordinance shall be published in full in The Flint Journal, a newspaper of general circulation in the County qualified under Michigan law to publish legal notices, promptly after its adoption, and shall be recorded in the Ordinance Book of the County and such recording authenticated by the signatures of the Chairman of the Board of Commissioners and the County Clerk.
Section 20. Effective Date. This Ordinance shall be effective immediately upon its adoption.
Adopted and signed this 24th day of September, 2025.
Signed:
Chairman, Board of Commissioners
Signed:
County Clerk
I hereby certify that the foregoing constitutes a true and complete copy of an Ordinance duly adopted by the Board of Commissioners of the County of Genesee, Michigan, at a regular meeting held on the 24th day of September, 2025, and that said meeting was conducted and public notice of said meeting was given pursuant to and in full compliance with the Open Meetings Act, being Act 267, Public Acts of Michigan, 1976, and that the minutes of said meeting were kept and will be or have been made available as required by said Act.
I further certify that the following Commissioners were present at said meeting to vote on the Ordinance: ____________________________________________________________, and that the following Commissioners were absent: ____________________________.
I further certify that Commissioner _____________ moved adoption of said Ordinance, and that said motion was supported by Commissioner _____________.
I further certify that the following Commissioners voted for adoption of said Ordinance: __________________________________________________________________, and that the following Commissioners voted against adoption of said Ordinance: _______________________.
I further certify that said Ordinance has been recorded in the Ordinance Book and that such recording has been authenticated by the signatures of the Chairperson of the Board of Commissioners and County Clerk.
County Clerk