9603-05 Authorizing the Issuance of Revenue Bonds - Concerning the Construction of Improvements to the Municipal Waterworks - not to exceed $4,710,000

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The Council now finds that pursuant to the 2002 Supplemental Ordinance, the City entered into an Insurance Agreement with Financial Security Assurance Inc. ("FSA"), dated June 27, 2002 (the "Insurance Agreement"), and pursuant to the Insurance Agreement, FSA issued its Municipal Bond Debt Service Reserve Insurance Policy No. 29146-R, effective June 27, 2002 (the "2002 Reserve Insurance Policy"). The 2002 Reserve Insurance Policy covers principal and interest payments on the 1993 Bonds, 1997 Bonds, 2000 Bonds and 2002 Bonds, up to the Policy Limit stated in the 2002 Reserve Insurance Policy. The initial Policy Limit of 2002 Reserve Insurance Policy was set at $2,332,703, and under the terms of such policy, the Policy Limit is automatically reduced, from time to time, by the amount of the reduction in the debt service reserve requirement pertaining to the 1993 Bonds, 1997 Bonds, 2000 Bonds and 2002 Bonds. The Prior Bonds constitute a first charge upon the Net Revenues (as hereinafter defined). The Prior Ordinances provide that the City may authorize and issue additional bonds payable out of the Net Revenues ranking on a parity with the Parity Bonds for the purpose of financing the cost of future additions, extensions and improvements to the works subject to the provisions of Section 19 of the 1993 Ordinance and Section 20 of the 1997 Ordinance and Section 20 of the 2000 Ordinance and Section 20 of the 2002 Ordinance. The conditions precedent to the issuance of additional parity bonds set forth in the Prior Ordinances, as described above, have been satisfied, subject to approval by the State of Indiana. The City desires to authorize the issuance of a bond anticipation note or notes hereunder, if necessary, payable from the proceeds of the revenue bonds authorized herein (the "BANS"), and to authorize the refunding of said BANS, if issued. The Council now finds that all conditions precedent to the adoption of an ordinance authorizing the issuance of revenue bonds and BANS have been complied with in accordance with the applicable provisions of the Act. NOW THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AS FOLLOWS: SECTION 1. Project. The City shall proceed with the Project in accordance with the cost estimates, and the plans and specifications heretofore prepared and filed by the consulting engineers employed by the City, which cost estimates, plans and specifications are hereby approved and are hereby incorporated by reference as if set forth in full at this place, two copies of which are on file and available for public inspection in the office of the City Clerk pursuant to I.C. §36-1-5-4. The actions of the Board of Directors of the Department of Waterworks (the "Board") of the City taken in connection with the Project are hereby approved, ratified, and confirmed. The Project shall be constructed and the bonds herein authorized shall be issued pursuant to and in accordance with the Act. The terms "works" and "utility" and other like terms where used in this Ordinance shall be construed to mean and include all structures and property of the City's waterworks utility. -3-