HomeMy WebLinkAboutOrd 3114 05/19/1981 ORDINANCE NO. 3114
AN ORDINANCE AUTHORIZING THE VILLAGE OF MOUNT
PROSPECT TO ENTER INTO AN INTERIM CONTRACT FOR WATER SUPPLY
WITH THE NORT~$EST SUBURBAN MUNICIPAL JOINT ACTION WATER
AGENCY.
Whereas the municipalities of Elk Grove Village,
Hanover Park, Hoffman Estates, Mt. Prospect, Rolling Meadows,
Schaumburg and Streamwood (the "Members") have established
the Northwest Suburban Municipal Joint Action Water Agency,
(the "Agency") for the purpose of planning, constructing and
financing a joint water supply system necessary to obtain an
adequate water supply from Lake Michigan for the water
systems of the respective municipalities; and
Whereas, the Agency intends to enter into a contract
to obtain detailed design and engineering plans preparatory
to construction of a joint water supply system for the
benefit of the Agency and its Members; and
Whereas, the Agency intends to borrow $5,300,000
and to issue its bond anticipation notes in the amount of
$5,300,000 to finance the contract for the design and
engineering plans together with the expenses of the Agency
and its staff, professional fees and expenses, expenses
of the Note issuance, Note discount, appropriate reserves and
contingencies; and
Whereas, the bond anticipation notes, both as
to principal and interest, will be payable solely from the
2-
following sources a) proceeds of refunding bonds or notes of
the Agency which may be used for that purpose; b) receipts
of the Agency from any Member under any Interim Contract for
Water Supply between the Agency and any Members and
from Citizens Utilities Company under an Interim Contract
for Water Supply between the Agency and Citizens, if any;
c) any amounts on hand at any time in the Agency's Project
Account and the Note Principal and Interest Accounts to be
established in the Resolution of the Agency authorizing
issuance of the Notes; d) any and all revenues of the Agency
from the sale of water or the operation of a water system;
and e) interest or other investment earnings of the Agency
on such accounts; and
Whereas, it is necessary and in the best interests
of this Member to enter into this Contract with the Agency
which will contract to obtain design and engineering of the
joint water supply system in order to obtain a supply of
Lake Michigan water for the Members; and
Whereas, it is necessary and in the best interests
of this Member to agree to pay an amount equal to 13.40%
of the principal and interest on the bond anticipation notes
of the Agency and to make an appropriation therefor; and
Whereas, the Village of Mount Prospect is a home
rule municipality under the terms of Article VII, Section 6
of the Illinois Constitution and may exercise any power
and perform any function pertaining to its government and
affairs;
NOW, THEREFORE, BE IT ORDAINED BY THE PRESIDENT
AND BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT,
COOK COUNTY, ILLINOIS, AS FOLLOWS:
Section 1. The President and Village Clerk
are authorized to execute an Interim Contract for Water
Supply by and between the Village and the Northwest Suburban
Municipal Joint Action Water Agency, dated as of May, 19 ,
1981, a copy of which Contract is attached to and made a
part of this Ordinance as Exhibit 1.
Section 2. This Ordinance shall constitute an
appropriation of the funds necessary to meet the Village's
obligations to make payments of its proportionate share of
principal and interest under the Interim Contract for Water
Supply.
Section 3. Upon passage and approval, this
ordinance shall be in full force and effect ten days after
publication as required by law.
Passed and Approved by The Village of Mount
Prospect, this 19th. day of May , 1981.
Ayes:
Nays: None
Absent: Miller, Murauskis
Arthur, Farley, Floros, Wattenberg
~ Presidei~t
~Atte st:
Clerk
"r. ___ .
c:'
'1
O(2.t>~ 31'Lf.
S-''l-~ ,
~-~~,
, ,~(!
"ro ~~
INTERIM CONTRACT FOR
WATER SUPPLY
This Interim Contract for Water Supply, dated as
of ?~~> f /7
Suburban Municipal
, 1981, by and between the Northwest
Joint Action Water Agency (the "Agency")
and the Village of Mount Prospect, a municipal corporation
-
of the State of Illinois (the "Member"):
ARTICLE I
RECITALS
Section 1.1.
Pursuant to the 1970 Constitution
of the State of Illinois and Section 3.1 of the Intergovern-
mental Cooperation Act, as amended, the ~unicipalities of Elk
Grove Village, Hanover Park, Hoffman Estates, Mt. Prospect,
Rolling 1<1eadows, Schaumburg and Streamwood (the "Members")
have established a Municipal Joint Action Water Agency as of
March 16, 1981 for the purpose of planning, constructing and
financing a joint water supply system necessary to obtain an
adequate Lake Michigan water supply for the water systems of
member municipalities.
Section 1.2.
On behalf of its Members, the
Agency intends to construct a pipeline transmission system,
including pumps and a reservoir, to pump and provide
storage for Lake Michigan water sufficient to supply
the anticipated needs of the water systems of Members.
~~
,.
~
-2-
Section 1.3. The Agency intends to contract for
the preparation of detailed design and engineering plans for
the water supply system.
(Such plans are collectively
referred to as the "Project".) Costs of the Project,
including, without limitation, engineering fees and expenses,
expenses of the Agency and its staff, professional fees and
expenses in connection with the Project, financial, legal,
administrative and other expenses of the authorization,
issuance, sale and delivery of the Notes and appropriate
contingencies, are estimated at $5,300,000. The Project
will be useful for the entire period of construction and
operation of the joint water supply system, which is estimated
to be forty years.
Section 1.4.
The Agency now proposes to issue
$5,300,000 of its Contract Revenue and Bond Anticipation
Notes (the "Notes") at an interest rate not to exceed the
maximum rate established in "An Act to authorize public
corporations to issue bonds, other evidences of indebtedness
and tax anticipation warrants, subject to interest rate
limitations set forth therein", approved May 26, 1970, as
amended, in order to pay the costs of the Project. Notes in
the aggregate princlpal amount of $2,500,000 are to mature
November 1, 1983; and Notes in the aggregate principal
amount of $2,800,000 are to mature November 1, 1984. Interest
on the Notes is to be paid semi-annually on November 1 and
t1ay 1 of each year, with the first interest payment date
being November 1, 1981. Interest shall accrue on the outstanding
.41 $
-3-
principal amount of the Notes from their date until paid.
The Notes both as to principal and interest are to be payable
solely from the following sources: (a) proceeds of refunding
bonds or notes of the Agency which may be used for that
purpose; (b) receipts of the Agency from the Members under
any Interim Contracts for Water Supply between the Agency
and any Members; (c) any amounts on hand at any time in the
Agency Project Account and the Note Principal and Interest
Accounts to be established by the Resolution of the Agency
authorizing the issuance of the Notes (the "Note Resolution")
a copy which is attached in draft form, to be adopted by
the Agency with such modifications as the Agency, with advise
of counsel, deems advisable; (d) any and all revenues of the
Agency from the sale of water or the operation of a water
supply system; and (e) interest or other investment earnlngs
of the Agency on the amounts in such accounts.
Section 1.5. The Member, by adopting this Contract,
and the other Members, by adopting similar Contracts, agree
that they will be severally liable for the interest and
principal on the Notes not paid from other funds of the Agency.
The allocation of liability, based upon the Members' estimated
usage of water, potential growth in usage, and the distance
required to supply water to a Member is as follows:
Elk Grove 18.97%
Hanover Park 9.57%
Hoffman Estates 16.37%
Mt. Prospect 13.40%
Rolling Meadows 8.46%
. .' . r
-4-
Schaumburg
Streamwood
Section 1.6.
23.48%
9.75%
It is necessary and in the best
interest of the Member and the Agency for them to enter into
this Contract in order for the Member to obtain a supply of
water. It is necessary and in the best interest of the
Member to pay interest on its share of the Notes and, if
Notes are not paid from other funds of the Agency, to pay
its share of the principal coming due from time to time on
the Notes.
Section 1.7. Each Member intends to enter into
similar contracts and to pay its respective proportionate
share of the costs of the Project, but the obligation of the
Member is separate from the obligation of any other Member
and shall not in any respect be diminished or increased in the
event that any other Member or Members default in their
obligations under their Interim Contract for Water Supply.
ARTICLE II
THE PROJECT
Section 2.1. The Agency agrees to use its best
efforts to contract to obtain detailed design and engineering
plans for a joint water supply system for the benefit of the
~1embers. The cost of the plans, including without limitation
. i I t.
-5-
engineering fees, expenses of the Agency and its staff and
professional fees and expenses in connection with the Project,
financial, legal, administrative and other expenses of the
authorization, issuance, sale and delivery of the Notes, and
appropriate contingencies, are estimated to be $5,300,000.
Section 2.2.
The Agency shall use its best
efforts to finance the Project and to provide a water supply
system producing Lake Michigan water for the Members.
Section 2.3.
Upon construction of the joint
water supply system, the Agency shall sell water from Lake
Michigan to the Members upon such terms and conditions and
at such rates as the Agency and the Members shall determine
In accordance with the terms of the Agreement establishing
the Agency and such further agreements as may be appropriate.
ARTICLE III
THE NOTES
Section 3.1.
The Agency shall borrow the sum of
$5,300,000 for the Project and shall issue its Contract
Revenue and Bond Anticipation Notes in the principal amount
of $5,300,000, all as provided in the Note Resolution.
The Notes shall bear interest at a rate not to exceed the
maximum prescribed by "An Act to authorize public corpora-
tions to issue bonds, other evidences of indebtedness and
tax anticipation warrants subject to interest rate limita-
tions set forth therein", payable semi-annually on November
" .
-6-
1 and May 1 of each year with the first interest payment
date being November 1, 1981. Interest shall accrue on the
outstanding principal amount of the Notes from their date
until paid. Notes in the aggregate principal amount of
$2,500,000 shall mature on November 1, 1983; Notes in the
aggregate principal amount of $2,800,000 shall mature on
November 1, 1984.
Section 3.2. The Notes, both as to principal and
interest, shall be payable solely from (a) proceeds of
refunding bonds or notes of the Agency which may be used for
that purpose, (b) receipts of the Agency from the Members
under any Interim Contracts for Water Supply between the
Agency and any Members; (c) any amounts on hand at any time
in the Agency Project Account, the Note Principal and Interest
Accounts to be established by the Note Resolution; (d) any
and all revenues of the Agency from the sale of water or the
operation of water supply system; and (e) interest or other
investment earnings of the Agency on the amount in such
accounts.
Section 3.3.
The Notes shall not constitute an
indebtedness of the Agency or the Member within the meaning
of any constitutional or statutory limitation.
Section 3.4. The Notes shall be secured by a
pledge and assignment to a Trustee for the holders of such
, .
.
. .,
-7-
Notes and a grant to a Trustee for the holders of such Notes
of a security interest in and lien on all the Agency's
right, title and interest in and to its receipts under each
Interim Contract for Water Supply between the Agency and
each Member.
Section 3.5.
The Agency shall not issue the
Notes unless and until each Member has entered into an
Interim Contract for Water Supply and agreed to pay its
proportionate share of the principal and interest on the
Notes.
ARTICLE IV
AGREEMENT OF MEMBER
Section 4.1.
The Member shall pay to the Trustee
an amount equal to interest due on $335,000.00 of the Notes
that mature on November 1, 1983 and on $375,200.00 of the
Notes that mature on November 1, 1984 (or such lesser amount
as the Trustee notifies the Member as to its obligation)
not later than five days before each interest payment on
the Notes. The Trustee shall calculate the interest payment
due from each Member, after taking into account any other
funds available for payment of interest, and send notice of
the amount required not less than 10 days before the payment
is due to the Noteholder, provided that receipt of such
notice shall not be a precondition to the obligation of
Member under this Section 4.1.
, ~. . ~
-8-
Section 4.2. If the Notes are not refunded by
the Agency or if other funds are not available for payment
of the principal of the Notes by November 1, 1982, the
Trustee shall notify each Member. The Member shall notify
the Trustee and the Agency in writing by December 15, 1982
of its plan to provide for payment of its share of the
principal amount of the Notes. On or before January 1, 1983
the Member shall establish a separate account for the sole
purpose of payment of its share of principal of the Notes;
monies in such account shall be used for no other purpose
until and unless the Notes are refunded. On or before
January 1, 1983 and on or before the first day of each
succeeding nlne months, until and unless the Notes are
refunded, the Member shall deposit into such account an
amount equal to 1/10 of its share of the principal amount of
Notes due on November 1, 1983. On or before November 1,
1983 and on or before the first day of the next succeeding
eleven months, until and unless the Notes are refunded, the
Member shall deposit into such account an amount equal to
1/12 of its share of the principal amount of Notes due on
November 1, 1984. The Trustee and the Agency shall have
reasonable access to the Member's records of account for the
purpose of confirming that required deposits in such account
are made and preserved. If the Notes are refunded subsequent
to November 1, 1982, the Member's obligation to make deposits
in such account shall cease, and the Member may withdraw any
funds in such account.
.' . .f
-9-
The Trustee shall notify the Member ten days
before maturity of the Notes of its share, if any, of the
principal amount of such Notes after taking into account any
other funds available for payment of principal. The Member
shall pay to the Trustee an amount equal to $335,000.00 on
the Notes maturing on November 1, 1983 and $375,200.00 on the
Notes maturing on November 1, 1984 (or such lesser amount as
the Trustee notifies the Member as to its obligation) not
later than five days before maturity, provided that the
receipt of such notice shall not be a precondition to the
obligation of the Member under this Section 4.2.
Section 4.3. The obligation of the Member under
this Contract shall be a general obligation of the Member.
Section 4.4. The Member acknowledges that this
Contract shall be assigned by the Agency and the Agency will
grant a lien upon and security interest in this Contract to a
Trustee for the benefit of the holder of the Notes to be
issued by the Agency.
Section 4.5. After November 1, 1982, a Member
may prepay its obligation under this Contract in full by
depositing with the Trustee, In accordance with the Note
Resolution, an amount which, together with interest or other
investment earnings thereon is sufficient to pay, when
due, the Member's share of principal of and interest on
the Notes.
',t ".f
-10-
Section 4.6. The provisions of this Contract
shall constitute a contract between the Member and the
Agency for the benefit of the Trustee and Agency noteholders
and the Trustee, and holder of an Agency note may proceed by
civil action to enforce or compel performance by the officials
of the Member of all duties required by law and by this
Contract.
Section 4.7 The Member covenants with the Trustee
and the holders of the Notes that so long as any of the Notes
are outstanding, monies on deposit in any fund or account
to be used in connection with payment of the Member's
obligation under this Contract shall not be used in a manner
which would cause the Notes to become arbitrage Notes within
the meaning of Section 103(c) of the Internal Revenue Code of
1954, as amended, and any lawful regulations promulgated there-
under.
ARTICLE V
DEFEASANCE
If the Trustee has received amounts which, with
interest and investment earnings thereon, are sufficient to
pay principal of and interest on the Notes when due or if
payment of the Member's obligation hereunder shall be provided
for in a manner satisfactory to the Trustee, all of the
right, title and interest of the Agency, the Trustee and the
Note Holders in and to this Contract shall be terminated.
'.
.
. 1
-11-
Upon request of the Member, the Agency shall deliver and
shall cause the Trustee to deliver a proper instrument
acknowledging the satisfaction and termination of the ~1ember's
obligations under this Contract.
After the Notes have been paid in full at maturity
or the Trustee has received sufficient funds to defease the
Notes in full, the Trustee shall return to the Agency
any funds remaining in the Note Principal and Interest Account
that are not required to defease the Notes, as provided in
the Note Resolution. The Agency shall disburse such funds
to the then Members in proportion to the actual amounts paid
by the respective Members under the Contracts.
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
Section 6.1.
The occurrence and continuation of
anyone of the following shall constitute an Event of Default:
a) failure by the Member to pay any amounts
required to be paid under this Contract at the times speci-
fied herein; or
b) failure by the Member to observe or perform
any covenant, condition or agreement on its part to be
observed or performed in this Contract other than as referred
<
.
. . f
-12-
to in (a) above, for a period of 30 days after written
notice specifying such failure and requesting that it be
remedied, given to the Member by the Agency or the Trustee,
unless the Agency and the Trustee shall agree in writing to
an extension of such time prior to its expiration; provided,
however, if the failure stated in the notice cannot be
corrected within the applicable period, the Agency and the
Trustee may consent to an extension of such time if corrective
action is instituted within the applicable period and diligently
pursued until the default is corrected.
Section 6.2. Whenever any Event of Default shall
have happened and is continuing, the Agency, Trustee or any
Noteholder may take anyone or more of the following remedial
steps:
b) It may take whatever action at law or in
equity which is necessary or desirable to collect the payments
and other amounts then due or thereafter to become due or to
enforce the performance and observance of any obligation,
agreement or covenant of the Member under this Contract,
including the right to bring an action in mandamus.
If the Agency, Trustee or Noteholder has proceeded
to enforce its rights under this Contract and such proceedings
have been discontinued or abandoned for any reason or have
been determined adversely to the Agency, Trustee or Noteholder,
then the Agency, Trustee or Noteholder and Member shall be
restored respectively to their position and rights hereunder,
r
.
-13-
and all rights, remedies and powers of the Member and the
Agency, Trustee and Noteholder shall continue as though no
such proceeding had been taken.
Section 6.3. No remedy herein conferred upon or
reserved to the Agency, Trustee or Noteholder is intended to
be exclusive of any other available remedy or remedies, but
each remedy shall be cumulative and shall be in addition to any
remedy given under this Contract or now or hereafter existing
at law, in equity or by statute. No delay or omission to
exercise any right or power accruing upon any default shall
impair that right or power or shall be construed to be a
walver thereof, but that right or power may be exercised
from time to time and as often as may be deemed expedient.
In order to entitle the Agency, Trustee or Noteholder to
exercise any remedy reserved to it in this Article, it shall
not be necessary to give any notice, other than notice
herein expressly required. The rights and remedies given
the Agency hereunder shall also extend to the Trustee on
behalf of the Noteholders and the Noteholders who shall be
deemed third party beneficiaries of all covenants and agree-
ments herein contained.
ARTICLE VII
REPRESENTATIONS OF PARTIES
Section 7.1. The Member covenants and represents
to the Agency as follows:
. r
. d
-14-
a) The Member is legally and validly existing
Village under the Constitution and laws of the State of
Illinois exercising home rule powers, and the officers of
the Member have been duly elected and continue to hold title
to their respective offices.
b) The Member is empowered to enter into this
Contract.
c) The execution of this Contract has been duly
authorized by ordinance of the Member which remains in full
force and effect and this Contract is a valid and binding
obligation of the Member for which an appropriation has been
duly enacted and remains in full force and effect.
d) All conditions, acts and things required by
the Constitution and laws of this State to exist or to be
done precedent to the execution of this Contract exist or
have been done.
e) The obligation of the member represented by
this Contract does not exceed any constitutional or stat-
utory limitation on debt.
f) The adoption of the ordinance authorizing
the execution of this Contract and making an appropriation
therefor and the execution of this Contract will not
conflict with, result in a breach of, constitute a default
under the Constitution of the State of Illinois, or any
law, rule, regulation, ordinance, resolution or agreement to
which the Member is a party or by which it is bound.
J
-15-
Section 7.2. The Agency covenants and represents
to the Member as follows:
a) The Agency is a legally and validly existing
body politic and corporate and municipal corporation under
the Constitution and laws of the State and the officers of
the Agency have been duly appointed and continue to hold
title to their respective offices.
b) The Agency is empowered to enter into this
Contract.
c) The execution of this Contract has been duly
authorized by Resolution of the Agency which remains in
full force and effect and this Contract is a valid and binding
obligation of the Agency.
d) All conditions, acts and things required by
the Constitution and laws of this State to exist or to be
done precedent to the execution of this Contract exist or
have been done.
e) The adoption of the Resolution authorizing
the execution of this Contract and the execution of this
Contract will not conflict with, result in a breach of,
or constitute a default under the Constitution of the State
of Illinois or any law, rule, regulation, ordinance, resolu-
tion or agreement to which the Agency is a party or by which
it is bound.
.r
. ~
-lG-
shall be deemed given on the third day following the day on
which mailed certified mail, postage prepaid, addressed as
follows:
Agency:
Mr. Charles Willis
Chairman of The Executive Committee
Northwest Suburban Municipal Joint
Action Water Agency
901 Wellington Avenue
Elk Grove Village, IL 60007
Member:
Village Manager
Village of Mount Prospect
100 South Emerson Street
Mount Prospect, Illinois 60056
The parties may, by notice given hereunder, designate any
further or different addresses to which subsequent notices,
certificates or other communications shall be sent.
Section 8.2. . This agreement may not be assigned
by either party without the prior written consent of the
other and of the Trustee except that the Agency shall assign
to the Trustee its rights under this Contract.
Section 8.3.
If any provision of this Contract
shall be held or deemed to be or shall, in fact, be illegal,
inoperative or unenforceable, that provision shall not
affect any other provisions herein contained or render those
other provisions invalid, inoperative or unenforceable to
any extent.
. r' , "'
"
-1''"1-
j
Section 8.4. Except as otherwise provided in this
Contract, subsequent to the initial issuance of the Notes
and prior to their payment in full, this Contract may not be
effectively amended, changed, modified, altered or terminated
without the prior written consent of the Trustee.
IN WITNESS WHEREOF, the Agency and the Member have
caused this Agreement to be executed in their respective
corporate names and attested by their duly authorized offi-
cers, all as of the date first above written.
NORTHWEST SUBURBAN MUNICIPAL
J/}OINT,iACTION \\TATE~
I / // (\ /
(/ )/. ' . I .I
" X:,/ /( b>: //:Y
Chairman 1/ / /
v f..-,./
Attest:
"
. J
/,/ /./" ~ -
Secretary
, >
---'-- ~
VILLAGE OF MOUNT PROSPECT
{;Lu4~ /I ~~~~
President.
2~ybd<v
Clerk