This chapter may be cited as the "Sunnyvale Municipal Utilities
Revenue Bond Law."
(2917-10 § 1)
The city council hereby finds and declares that it is necessary,
essential, a public purpose and a municipal affair for the city to
provide financing for municipal utilities serving residents and businesses
of the city in the interests of the public health, safety and welfare.
(2917-10 § 1)
Unless the context otherwise requires, the following definitions
shall govern the construction of this chapter:
"Acquisition and construction"
mean, with respect to any utility or portion thereof, the
acquisition, construction, improvement, furnishing, equipping, remodeling,
repair, reconstruction or rehabilitation thereof.
"Bonds"
mean any bonds, notes, installment sale agreements, leases
or other obligations issued or entered into by the city pursuant to
this chapter for the purpose of financing the costs of a utility,
which are payable exclusively from revenues relating to such utility
and other funds permitted by this chapter.
"This chapter"
means Chapter
3.70 of the Sunnyvale Municipal Code, as amended from time to time in accordance herewith.
"Charter"
means the charter of the city of Sunnyvale, as amended from
time to time.
"City"
means the city of Sunnyvale, California, a charter city in
the state of California existing under and exercising powers pursuant
to the Charter and the Constitution of the state of California.
"Costs"
mean, with reference to a utility or any portion thereof,
any or all of the following costs incurred for the acquisition and
construction thereof:
(a)
Obligations of the city incurred for labor and materials in
connection with the acquisition and construction of such utility or
portion thereof;
(b)
The cost of acquisition and construction of any property, whether
real or personal and improved or unimproved, including franchise rights
and other intangible property, and any interests therein, required
for the acquisition and construction of such utility or portion thereof;
(c)
The cost of demolishing, removing or relocating any building
or structure, and the cost of making relocation assistance payments
required by law;
(d)
The cost of contract bonds and of insurance of all kinds that
may be required or necessary during the course of the acquisition
and construction of such utility or portion thereof;
(e)
All costs of engineering, legal and consultant services, including
the costs of the city for surveys, estimates, plans and specifications
and preliminary investigation therefor, and for supervising construction,
as well as for the performance of all other duties required by or
consequent upon the proper acquisition and construction of such utility
or portion thereof;
(f)
All costs incurred in connection with proceedings by the city
necessary to comply with the California Environmental Quality Act
of 1970, as amended;
(g)
All amounts required to fund any reserve funds for bonds and
any interest on bonds becoming due and payable during a period not
exceeding the period of acquisition and construction of such utility
or portion thereof, and for twelve months thereafter;
(h)
All costs of issuance of the bonds;
(i)
All costs which the city shall be required to pay, under the
terms of any contract or contracts, for the acquisition and construction
of such utility, or portion thereof;
(j)
The refinancing of any existing indebtedness relating to such
utility or portion thereof; and
(k)
Any sums required to reimburse the city for advances made for
any of the above items, or for any other costs incurred and for work
done which are properly chargeable to such utility or portion thereof.
"Revenues"
mean, with respect to a utility, all gross income and revenue
received by the city from the ownership and operation of such utility,
including all fees and charges received by the city for the services
of such utility, and all other income and revenue howsoever derived
by the city from the ownership and operation of such utility or arising
from such utility, and including all receipts derived from the investment
of such income or revenues, including moneys deposited in a sinking,
redemption or reserve fund or other fund to secure the bonds or to
provide for the payment of the principal of or interest on the bonds
and such other moneys as the city council may in its discretion make
available therefor. With respect to any grant anticipation notes issued
under this chapter, the term "revenues" shall also include the revenues
derived from the proceeds of any federal or state grant with respect
to such utility. The precise description of the revenues with respect
to any utility for which financing is provided under this chapter
shall be set forth in the proceedings of the city council authorizing
such financing.
"State"
means the state of California.
"Utility"
means any revenue-producing improvement, building, system,
plant, works, facility, or undertaking of any nature whatsoever, which
are used in any municipal utility enterprise of the city. Such municipal
utility enterprises may include, but shall not be limited to, any
one or more of the following:
(a)
The system of the city for the acquisition, storage, treatment
and distribution of water for domestic, commercial and industrial
use, irrigation, sanitation, fire protection, recreation or any other
public or private use;
(b)
The system of the city for the collection, treatment and disposal
of sewage, waste or storm water, including drainage;
(c)
The solid waste refuse collection, recycling and disposal system
of the city;
(d)
Public parking lots, garages or other automotive or vehicular
parking facilities, including any and all public off-street vehicular
parking facilities;
(e)
Facilities and other property required for the generation, production,
transmission and distribution of electric energy for lighting, heating,
and power for public or private uses;
(f)
Facilities and other property required for the production, transmission
and distribution of gas for public or private uses; and
(g)
Any other utility enterprise which the city is authorized to
create, acquire, construct, operate and maintain. The precise description
of any utility for which financing is provided under this chapter
shall be set forth in the proceedings of the city council authorizing
such financing.
(2917-10 § 1)
In connection with the acquisition and construction of a utility
by the city, the city is authorized and empowered:
(1) To
issue bonds for the purpose of financing or otherwise assisting the
payment of the costs of such utility and for the purpose of funding
or refunding any issue of bonds;
(2) To
establish the terms and conditions for the financing of any component
of such utility undertaken pursuant to this chapter;
(3) To
employ or contract for such legal, consultant, underwriting, economic
feasibility, or other services in connection with the financing of
such utility, or to contract for bond insurance or other forms of
collateral security, as may be necessary in the judgment of the city
council for the successful financing of such utility and the issuance
and sale of bonds therefor; and
(4) In
addition to all other powers specifically granted in this chapter,
to do all things necessary or convenient, in the judgment of the city
council, to carry out the purposes of this chapter.
(2917-10 § 1)
The city may issue its bonds for the purpose of financing or
otherwise assisting the acquisition and construction of all or any
portion of a utility as authorized by this chapter. Every issue of
bonds shall be a special obligation of the city, payable solely from
all or any part of the revenues with respect to such utility. It shall
not be necessary that the issuance of any bonds be subject to authorization
by the voters of the city.
(2917-10 § 1)
Bonds may be issued as serial bonds or as term bonds, as current
interest bonds or capital appreciation bonds, or in such other or
additional forms as the city council may deem advisable. The bonds
shall be authorized by resolution of the city council and shall bear
such date or dates, mature at such time or times, bear interest at
such fixed or variable rate or rates, be payable at such time or times,
be in such denominations, be in such form, carry such registration
privileges, be executed in such manner, be payable in lawful money
of the United States of America at such place or places, and be subject
to such terms of redemption as the city council may provide. The bonds
may be sold at either a public or private sale and for such prices
as the city council shall determine.
(2917-10 § 1)
Any proceedings of the city authorizing bonds for a utility
may contain provisions respecting any of the following terms and conditions,
which shall be a part of the contract with the owners of the bonds:
(1) The
pledge of all or any part of the related revenues, subject to such
agreements with bond owners as may then exist;
(2) The
creation of any mortgage, lien or other security interest on any part
of a utility, or on any other funds, rights or assets of the city
of any nature whatsoever relating to such utility;
(3) The
interest and principal to be received and other charges to be charged
and the amounts to be raised each year thereby, and the use and disposition
of such revenues;
(4) The
setting aside of reserves or sinking funds and the regulation and
disposition thereof;
(5) Limitations
on the purposes to which the proceeds of a sale of any issue of bonds,
then or thereafter issued, may be applied, and pledging such proceeds
to secure the payment of the bonds or any issue of bonds;
(6) Limitations
on the issuance of additional bonds, the terms upon which additional
bonds may be issued and secured, and the refunding of outstanding
bonds;
(7) The
procedure, if any, by which the terms of any contract with bond owners
may be amended or abrogated, the amount of bonds the owners of which
must consent thereto, and the manner in which such consent may be
given;
(8) Specification
of the acts or omissions to act which shall constitute a default in
the duties of the city to the owners of the bonds, and providing the
rights and remedies of such owners in the event of default; and
(9) Such
other terms and conditions pertaining to the issuance of the bonds
as are deemed advisable by the city council.
(2917-10 § 1)
In the discretion of the city council, any bonds issued under
the provisions of this chapter may be secured by a trust agreement
or indenture by and between the city and a corporate trustee or trustees,
which may be any trust company or bank having the powers of a trust
company within or without the state. Such trust agreement or the indenture
may pledge or assign the revenues to be received or proceeds of any
contract or contracts pledged, and may convey or mortgage any property.
Such trust agreement or indenture may contain such provisions for
protecting and enforcing the rights and remedies of the bond owners
as may be reasonable and proper and not in violation of law, including
such provisions as is permitted to be included in any resolution or
resolutions of the city council authorizing the issuance of bonds
hereunder. Any bank or trust company doing business under the laws
of the state which may act as depository of the proceeds of bonds
or of revenues or other moneys may furnish such indemnity bonds or
pledge such securities as may be required by the city. Any such trust
agreement or indenture may set forth the rights and remedies of the
bond owners and of the trustee or trustees, and may restrict the individual
right of action by bond owners. In addition to the foregoing, any
such trust agreement or indenture may contain such other provisions
as the city council may deem reasonable and proper for the security
of the bond owners.
(2917-10 § 1)
Neither the members of the city council nor any person executing
the bonds shall be liable personally on the bonds or be subject to
any personal liability or accountability by reason of the issuance
thereof.
(2917-10 § 1)
The city council may provide for the issuance of bonds any portion
of which is to be used for the purpose of refunding outstanding bonds,
including the payment of the principal thereof and interest and redemption
premiums, if any, thereon. The proceeds of bonds issued to refund
any outstanding bonds may, in the discretion of the city council,
be applied to the retirement of such outstanding bonds at maturity,
or the redemption (on any redemption date) or purchase of such outstanding
bonds prior to maturity, upon such terms and subject to such conditions
as the city council shall deem advisable.
(2917-10 § 1)
Revenues, or any portion thereof, as designated in the resolution,
trust agreement or indenture authorizing the issuance of the bonds,
shall be the sole source of funds pledged by the city for repayment
of bonds issued hereunder. Bonds issued hereunder shall not be deemed
to constitute a debt or liability of the city or a pledge of the faith
and credit of the city but shall be payable solely from revenues.
All bonds shall contain on the face thereof a statement to the following
effect:
Neither the faith and credit nor the taxing power of the city
of Sunnyvale is pledged to the payment of the principal of or interest
on this bond.
The issuance of bonds shall not directly, indirectly or contingently
obligate the city council to levy or pledge any form of taxation or
to make any appropriation for their payment.
(2917-10 § 1)
All moneys received pursuant to the provisions of this chapter,
whether proceeds from the sale of bonds or revenues or other moneys
or assets authorized by this chapter to be pledged to secure payment
of bonds, shall, to the extent set forth in the resolution or trust
agreement authorizing the issuance of the bonds, be deemed to be trust
funds to be held and applied solely for the purposes of this chapter.
Any bank or trust company in which such moneys are deposited shall
act as trustee of such moneys and shall hold and apply the same for
the purposes specified in this chapter, subject to the terms of the
resolution, agreement or indenture authorizing the bonds.
(2917-10 § 1)
The city shall have the power, out of any funds available therefor,
to purchase its bonds. The city may hold, pledge, cancel or resell
such bonds, subject to and in accordance with its agreement with bond
owners.
(2917-10 § 1)
In anticipation of the sale of bonds authorized by this chapter,
the city is hereby authorized to issue bond anticipation notes, and
to renew the same from time to time, in such series and amounts as
are determined by the city council to be necessary or appropriate
for the costs of a utility approved by the city council. Such notes
shall be payable from revenues or other moneys or assets authorized
by this chapter to be pledged to secure payment of bonds, and which
are not otherwise pledged, or from the proceeds or sale of the particular
bonds in anticipation of which they are issued. Such notes shall be
issued in the same manner as other bonds which are authorized to be
issued hereunder.
(2917-10 § 1)
In anticipation of the receipt of funds derived from any federal
or state grants with respect to a utility or any portion thereof,
the city is hereby authorized to issue grant anticipation notes, and
to renew the same from time to time, in such series and amounts as
are determined by the city council to be necessary or appropriate
for the costs of a utility approved by the city council and reimbursable
from such grants. Such notes shall be payable from the revenues derived
from the proceeds of such grants or other moneys or assets authorized
by this chapter to be pledged to secure payment of bonds, and which
are not otherwise pledged, or from the proceeds or sale of the particular
bonds in anticipation of which they are issued. Such notes shall be
issued in the same manner as other bonds which are authorized to be
issued hereunder.
(2917-10 § 1)
This chapter, being necessary for the health, welfare and safety
of the city, its residents and businesses, shall be liberally construed
to effect its purposes. Furthermore, the city council hereby declares
that this chapter is an exercise of the power granted to the city
by the city charter and the Constitution of the state of California,
and is an exercise by the city of its powers as to municipal affairs
and its police powers, and this chapter shall be liberally construed
to uphold its validity under the laws of the state.
(2917-10 § 1)
This chapter shall be deemed to provide a complete, additional
and alternative method for doing the things authorized hereby, and
shall be regarded as supplemental and additional to the powers conferred
by other laws. The issuance of bonds under the provisions of this
chapter need not comply with the requirements of any other law applicable
to the issuance of bonds for a utility. The purposes authorized hereby
may be effectuated and bonds are authorized to be issued for any such
purposes under this chapter notwithstanding that any other law may
provide for such purposes or for the issuance of bonds for like purposes
and without regard to the requirements, restrictions, limitations
or other provisions contained in any other law.
(2917-10 § 1)
An action may be brought pursuant to Chapter 9 (commencing with Section 860 of Title
10 of Part 2 of the
Code of Civil Procedure) to determine the validity of bonds and the legality and validity of all proceedings previously taken and proposed to be taken for the authorization, issuance, sale, and delivery of the bonds and for the payment of the principal thereof and interest thereon.
(2917-10 § 1)
This chapter shall not be amended so as to have a material,
adverse affect upon the rights of the owners of any outstanding bonds
theretofore issued hereunder, without the written consent of such
bond owners; provided, however, that this chapter may be amended at
any time:
(1) To
make such provisions for the purpose of curing any ambiguity, or of
curing, correcting or supplementing any defective provision herein
contained, as the city may deem necessary or desirable; or
(2) If
such amendment does not materially impair or adversely affect the
interests of any such bond owner in the opinion of the city council;
or
(3) If
such amendments apply solely to bonds not theretofore issued.
(2917-10 § 1)
To the extent that the provisions of this chapter are inconsistent
with the provisions of any general statute or special act or parts
thereof, the provisions of this chapter shall be deemed controlling.
(2917-10 § 1)