In accordance with Chapter 35.54 RCW, the city establishes and creates a fund for the purpose of guaranteeing, to the extent of such fund, the payment of its bonds and warrants issued to pay for any local improvement ordered in local improvement districts in the city. This fund shall be known and designated as the "local improvement guaranty fund."
(Ord. 47 § 1, 1956; Ord. 717 § 1, 1995)
The city shall maintain and operate its guaranty fund in accordance with the laws contained in Chapter 35.54 RCW and such other laws that specifically or generally apply to the guaranty fund or obligations secured thereby, as the same may be amended from time to time. Obligations guaranteed by the guaranty fund shall include, in addition to those obligations referred to in Chapter 35.54 RCW, obligations issued under Chapter 39.50 RCW in anticipation of the issuance of local improvement district bonds.
(Ord. 865 § 7, 2005)
The city treasurer is authorized and directed to pay into such local improvement guaranty fund all interest and earnings received from bank deposits of the fund, as well as any surplus remaining in any local improvement fund guaranteed by a local improvement guaranty fund after the payment of all outstanding bonds or warrants payable therefrom.
(Ord. 47 § 5, 1956; Ord. 717 § 2, 1995)
The city shall maintain a balance in the guaranty fund during each calendar year that is at least equal to the interest scheduled to come due on all outstanding obligations guaranteed by the guaranty fund during the following calendar year. Notwithstanding the foregoing, the city council may, with respect to the obligations issued on account of any local improvement district, require by ordinance that the minimum balance in the guaranty fund on account of such obligations be greater than is otherwise required by the preceding sentence.
(Ord. 865 § 8, 2005)
Defaulted bonds, interest coupons and warrants against the local improvement fund shall be purchased out of the local improvement guaranty fund, pursuant to RCW 35.54.070.
(Ord. 717 § 4, 1995)
Warrants shall draw interest at a rate to be established by the city council at the time of issuance. Such warrant shall be issued by the city, against the local improvement guaranty fund to meet any liability accruing against it; provided, that such warrants shall at no time exceed five percent of the outstanding obligations guaranteed by the fund.
(Ord. 47 § 3, 1956; Ord. 717 § 5, 1995)
Whenever warrants drawing interest are issued by the city against the guaranty fund to meet any proper liability of such fund, at the time of making its next annual budget and tax levy, the city shall provide for the levying of a sum sufficient, with other resources of that fund, to pay warrants so issued during the preceding fiscal year and to establish an appropriate balance therein. This section is intended to implement Chapter 35.54 RCW and assure that a balance considered appropriate by the city council is maintained in the guaranty fund.
(Ord. 717 § 6, 1995; Ord. 865 § 10, 2005)
Whenever the city shall have paid out of the local improvement guaranty fund any sum on account of principal or interest on a local improvement bond or warrant guaranteed under this chapter, the city, as trustee for such fund, shall be subrogated to all of the rights of the holder of the bond, interest coupon or warrant so paid, and the proceeds thereof, or of the underlying assessment, shall become a part of the fund.
(Ord. 47 § 4, 1956; Ord. 717 § 7, 1995)
Neither the owner nor the holder of any bond, interest coupon, or warrant issued against a local improvement fund after the passage of the ordinance codified in this chapter shall have any claim therefor against the city except for payment from the special assessments made for the improvement for which the bond or warrant was issued, and except as against the local improvement guaranty fund created by this chapter. The city shall not be liable to any holder or owner of such bond, interest coupon, or warrant for any loss to the guaranty fund occurring in the lawful operation thereof by the city. The remedy of the holder or owner of a bond or warrant in case of no payment shall be confined to the enforcement of the assessment and to the guaranty fund.
(Ord. 47 § 6, 1956)
For the purpose of protecting the local improvement guaranty fund, so much of the local improvement guaranty fund as is necessary may be used to purchase certificates of delinquency for general taxes on property subject to local improvement assessments which underlie the bonds, coupons, or warrants guaranteed by the fund, or to purchase such property at county tax foreclosures, or from the county after foreclosure, pursuant to RCW 35.54.080.
(Ord. 717 § 9, 1995)
To the extent that the city is required by Section 148 of the Internal Revenue Code of 1986, as amended, or any successor federal law, to make arbitrage rebate payments to the U.S. Treasury on account of the investment of the guaranty fund, such payments may be made from amounts on deposit in the guaranty fund. The city may establish subaccounts within the guaranty fund from time to time, if necessary or desirable for purposes of accounting for the investment of money therein.
(Ord. 865 § 11, 2005)