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HomeMy WebLinkAboutRES 1989-07 - Board RESOLUTION NO. 8907 OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT AUTHORIZING PURCHASE OF FARMERS HOME ADMINISTRATION LOANS BY MEANS OF AN INTERNAL LOAN WHEREAS, the Truckee Donner Public Utility District has two outstanding loans from the Farmers Home Administration, the 1977 Promissory Note which has a present balance of $227,760.89 and the 1980-1 Water Revenue Bond, which has an outstanding balance of $290, 000; and WHEREAS, the Farmers Home Administration is offering a discount purchase program which will allow the District to purchase the . loans at a substantial discount; and WHEREAS, the District has determined that purchasing these loans would be economically beneficial to the District; and WHEREAS, if funds on hand accumulated through operations are used �^ to purchase these loans, the District will realize a larger discount than if the loans are purchased through tax-exempt borrowing; and WHEREAS, an economical source of tax-exempt funds has not been found; and WHEREAS, the 1977 Promissory Note Reserve Fund, in the approximate amount of $10,360, and the 1980-1 Water Revenue Bond Reserve Fund, in the approximate amount of $11,580, are available for use toward the purchase of these loans; and WHEREAS, the District has funds on hand, known as the "Dart Funds, " which were accumulated for the purpose of funding capital improvements to the water distribution system serving the Tahoe Donner Subdivision of Truckee; and WHEREAS, the District has determined that an adequate water source currently exists for the Tahoe Donner Subdivision, and that the capital improvement that will need to be undertaken with the "Dart Funds, " a pump station upgrade, will not be required for approximately thirteen years, and as a result, the "Dart Funds" are available for an internal loan for that period of time; and WHEREAS, the "Dart Funds" are currently invested by the District �,., in the Local Agency Investment Fund; and WHEREAS, the District has, pursuant to the Board's approval, made a good faith deposit of $25,888. 04 with the Farmers Home Administration, to be applied to the purchase price of the loans; NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Truckee Donner Public Utility District as follows: (1) The "Dart Funds, " in the approximate amount of $318,000 and all interest earned on such funds, shall hereafter be termed the "Tahoe Donner water system fund, " and (2) The District shall purchase the loans referred to above, using an approximate discount rate of 11%, with a closing date as agreed upon by the District and the Farmers Home Administration, but in any event, no later than May 9, 1989; (3) The District shall fund the purchase by use of the 1977 Promissory Note and 1980-1 Water Revenue Bond reserve funds and through an internal loan against the Tahoe Donner Upgrade Fund, shall pay interest into such fund at the average effective yield paid by the Local Agency Investment Fund during the previous six months, and will repay �- principal from such fund in semi-annual installments of $17, 000 on March 1 and September 1 of each year, with all principal and interest due and payable thirteen years from the date of the closing of such loan purchase. PASSED AND ADOPTED at a regular meeting of the Board of Directors of the Truckee Donner Public Utility District duly called and held in said District on the 20th day of March, 1989 by the following roll call vote: AYES: Aguera, Corbett, Sutton, White and Maass. NOES: None. ABSENT: None. TRUCKEE DONNpE_R PUBLIC UTILITY DISTRICT J s A. Maass, President ATTEST, C_ Susan X. Craig, DeputVbisitrict Clerk smc RESOLUTION NO. 8907 OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT AUTHORIZING PURCHASE OF FARMERS HOME ADMINISTRATION LOANS BY MEANS OF AN INTERNAL LOAN WHEREAS, the Truckee Donner Public Utility District has two outstanding loans from the Farmers Home Administration, the 1977 Promissory Note which has a present balance of $227,760. 89 and the 1980-1 Water Revenue Bond, which has an outstanding balance of $290, 000; and WHEREAS, the Farmers Home Administration is offering a discount purchase program which will allow the District to purchase the . loans at a substantial discount; and WHEREAS, the District has determined that purchasing these loans would be economically beneficial to the District; and WHEREAS, if funds on hand accumulated through operations are used to purchase these loans, the District will realize a larger discount than if the loans are purchased through tax-exempt borrowing; and WHEREAS, an economical source of tax-exempt funds has not been found; and WHEREAS, the 1977 Promissory Note Reserve Fund, in the approximate amount of $10, 360, and the 1980-1 Water Revenue Bond Reserve Fund, in the approximate amount of $11, 580, are available for use toward the purchase of these loans; and WHEREAS, the District has funds on hand, known as the "Dart Funds, " which were accumulated for the purpose of funding capital improvements to the water distribution system serving the Tahoe Donner Subdivision of Truckee; and WHEREAS, the District has determined that an adequate water source currently exists for the Tahoe Donner Subdivision, and that the capital improvement that will need to be undertaken with the "Dart Funds, " a pump station upgrade, will not be required for approximately thirteen years, and as a result, the "Dart Funds" are available for an internal loan for that period of time; and WHEREAS, the "Dart Funds" are currently invested by the District in the Local Agency Investment Fund; and 4�. WHEREAS, the District has, pursuant to the Board's approval, made a good faith deposit of $25, 888. 04 with the Farmers Home Administration, to be applied to the purchase price of the loans; NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Truckee Donner Public Utility District as follows: (1) The "Dart Funds, " in the approximate amount of $318, 000 and all interest earned on such funds, shall hereafter be termed the "Tahoe Donner water system fund, " and (2) The District shall purchase the loans referred to above, using an approximate discount rate of 11t, with a closing date as agreed upon by the District and the Farmers Home Administration, but in any event, no later than May 9, 1989; (3) The District shall fund the purchase by use of the 1977 Promissory Note and 1980-1 Water Revenue Bond reserve funds and through an internal loan against the Tahoe Donner Upgrade Fund, shall pay interest into such fund at the average effective yield paid by the Local Agency Investment Fund during the previous six months, and will repay principal from such fund in semi-annual installments of $17, 000 on March 1 and September 1 of each year, with all principal and interest due and payable thirteen years from the date of the closing of such loan purchase. PASSED AND ADOPTED at a regular meeting of the Board of Directors of the Truckee Donner Public Utility District duly called and held in said District on the 20th day of March, 1989 by the following roll call vote: AYES: Aguera, Corbett, Sutton, White and Maass. NOES: None. ABSENT: None. TRUCKEE DONNER PUBLIC UTILITY DISTRICT By Japs A. Maass, President ATTEBT. c- Susan M. Craig, Deputy/�istrict Clerk smc